Attached files
| file | filename |
|---|---|
| 8-K/A - FORM 8K-A NEW CREDIT FACILITY - NEW JERSEY RESOURCES CORP | form8kanewcreditfac.htm |
Exhibit
4.1
CREDIT
AGREEMENT
by
and among
NEW
JERSEY NATURAL GAS COMPANY
and
THE
LENDERS PARTY HERETO
and
PNC
BANK, NATIONAL ASSOCIATION,
as
Administrative Agent
and
JPMORGAN
CHASE BANK, N.A.,
as
Syndication Agent
and
U.S.
BANK NATIONAL ASSOCIATION and TORONTO DOMINION (NEW YORK) LLC,
as
Documentation Agents
and
PNC
CAPITAL MARKETS LLC,
as
Lead Arranger
Dated
as of December 11, 2009
PRN
376736/8
|
Section
|
TABLE
OF CONTENTS
|
Page
|
|
1.
|
CERTAIN
DEFINITIONS
|
1
|
|
1.1
|
Certain
Definitions.
|
1
|
|
1.2
|
Construction.
|
24
|
|
1.2.1.
|
Number;
Inclusion.
|
24
|
|
1.2.2.
|
Determination.
|
24
|
|
1.2.3.
|
Agent's
Discretion and Consent.
|
24
|
|
1.2.4.
|
Documents
Taken as a Whole.
|
24
|
|
1.2.5.
|
Headings.
|
24
|
|
1.2.6.
|
Implied
References to this Agreement.
|
25
|
|
1.2.7.
|
Persons.
|
25
|
|
1.2.8.
|
Modifications
to Documents.
|
25
|
|
1.2.9.
|
From,
To and Through.
|
25
|
|
1.2.10.
|
Shall;
Will.
|
25
|
|
1.3
|
Accounting
Principles.
|
25
|
|
2.
|
REVOLVING
CREDIT AND SWING LOAN FACILITIES
|
26
|
|
2.1
|
Commitments.
|
26
|
|
2.1.1.
|
Revolving
Credit Loans.
|
26
|
|
2.1.2.
|
Swing
Loan Commitment.
|
26
|
|
2.2
|
Nature
of Lenders' Obligations with Respect to Revolving Credit
Loans.
|
26
|
|
2.3
|
Commitment
Fee.
|
27
|
|
2.4
|
Revolving
Credit Loan Requests.
|
27
|
|
2.5
|
Swing
Loan Requests.
|
28
|
|
2.6
|
Making
Revolving Credit Loans and Swing Loans.
|
28
|
|
2.6.1.
|
Making
Revolving Credit Loans.
|
28
|
|
2.6.2.
|
Making
Swing Loans.
|
29
|
|
2.7
|
Swing
Loan Note.
|
29
|
|
2.8
|
Use
of Proceeds.
|
29
|
|
2.9
|
Letter
of Credit Subfacility.
|
29
|
|
2.9.1.
|
Issuance
of Letters of Credit.
|
29
|
|
2.9.2.
|
Letter
of Credit Fees.
|
30
|
|
2.9.3.
|
Disbursements,
Reimbursement.
|
30
|
|
2.9.4.
|
Repayment
of Participation Advances.
|
32
|
|
2.9.5.
|
Documentation.
|
32
|
|
2.9.6.
|
Determinations
to Honor Drawing Requests.
|
33
|
|
2.9.7.
|
Nature
of Participation and Reimbursement Obligations.
|
33
|
|
2.9.8.
|
Indemnity.
|
35
|
|
2.9.9.
|
Liability
for Acts and Omissions.
|
35
|
|
2.10
|
Borrowings
to Repay Swing Loans.
|
36
|
|
2.11
|
Right
to Increase Commitments.
|
37
|
|
3.
|
INTENTIONALLY
OMITTED
|
38
|
|
4.
|
INTEREST
RATES
|
38
|
|
4.1
|
Interest
Rate Options.
|
38
|
|
4.1.1.
|
Revolving
Credit Interest Rate Options.
|
38
|
|
4.1.2.
|
Rate
Quotations.
|
39
|
|
4.1.3.
|
Change
in Fees or Interest Rates.
|
39
|
|
4.2
|
Interest
Periods.
|
39
|
|
4.2.1.
|
Amount
of Borrowing Tranche.
|
40
|
|
4.2.2.
|
Renewals.
|
40
|
|
4.3
|
Interest
After Default.
|
40
|
|
4.3.1.
|
Letter
of Credit Fees, Interest Rate.
|
40
|
|
4.3.2.
|
Other
Obligations.
|
40
|
|
4.3.3.
|
Acknowledgment.
|
40
|
|
4.4
|
Euro-Rate
Unascertainable; Illegality; Increased Costs; Deposits Not
Available.
|
40
|
|
4.4.1.
|
Unascertainable.
|
40
|
|
4.4.2.
|
Illegality;
Increased Costs; Deposits Not Available.
|
41
|
|
4.4.3.
|
The
Agent's and Lenders' Rights.
|
41
|
|
4.5
|
Selection
of Interest Rate Options.
|
42
|
|
5.
|
PAYMENTS
|
42
|
|
5.1
|
Payments.
|
42
|
|
5.2
|
Pro
Rata Treatment of Lenders; Sharing of Payments; Agent's
Presumptions.
|
43
|
|
5.2.1.
|
Pro
Rata Treatment of Lenders.
|
43
|
|
5.2.2.
|
Sharing
of Payments by Lenders.
|
43
|
|
5.2.3.
|
Presumptions
by the Agent.
|
44
|
|
5.3
|
Interest
Payment Dates.
|
45
|
|
5.4
|
Prepayments.
|
45
|
|
5.4.1.
|
Voluntary
Prepayments.
|
45
|
|
5.4.2.
|
Replacement
of a Lender.
|
46
|
|
5.4.3.
|
Change
of Lending Office.
|
47
|
|
5.5
|
Voluntary
Commitment Reductions.
|
47
|
|
5.6
|
Additional
Compensation in Certain Circumstances.
|
47
|
|
5.6.1.
|
Increased
Costs or Reduced Return Resulting From Taxes, Reserves, Capital Adequacy
Requirements, Expenses, Etc.
|
47
|
|
5.6.2.
|
Indemnity.
|
48
|
|
5.7
|
Interbank
Market Presumption.
|
49
|
|
5.8
|
Taxes.
|
50
|
|
5.8.1.
|
No
Deductions.
|
50
|
|
5.8.2.
|
Stamp
Taxes.
|
50
|
|
5.8.3.
|
Indemnification
for Taxes Paid by a Lender.
|
50
|
|
5.8.4.
|
Certificate.
|
50
|
|
5.8.5.
|
Survival.
|
50
|
|
5.9
|
Notes.
|
51
|
|
5.10
|
Settlement
Date Procedures.
|
51
|
|
6.
|
REPRESENTATIONS
AND WARRANTIES
|
51
|
|
6.1
|
Representations
and Warranties.
|
51
|
|
6.1.1.
|
Organization
and Qualification.
|
51
|
|
6.1.2.
|
Subsidiaries.
|
52
|
|
6.1.3.
|
Power
and Authority.
|
52
|
|
6.1.4.
|
Validity
and Binding Effect.
|
52
|
|
6.1.5.
|
No
Conflict.
|
53
|
|
6.1.6.
|
Litigation.
|
53
|
|
6.1.7.
|
Title
to Properties.
|
53
|
|
6.1.8.
|
Financial
Statements.
|
53
|
|
6.1.9.
|
Use
of Proceeds; Margin Stock; Section 20 Subsidiaries.
|
54
|
|
6.1.10.
|
Full
Disclosure.
|
55
|
|
6.1.11.
|
Taxes.
|
55
|
|
6.1.12.
|
Consents
and Approvals.
|
55
|
|
6.1.13.
|
No
Event of Default; Compliance With Instruments.
|
55
|
|
6.1.14.
|
Patents,
Trademarks, Copyrights, Licenses, Etc.
|
56
|
|
6.1.15.
|
Insurance.
|
56
|
|
6.1.16.
|
Compliance
With Laws.
|
56
|
|
6.1.17.
|
Material
Contracts; Burdensome Restrictions.
|
56
|
|
6.1.18.
|
Investment
Companies; Regulated Entities.
|
57
|
|
6.1.19.
|
Plans
and Benefit Arrangements.
|
57
|
|
6.1.20.
|
Employment
Matters.
|
58
|
|
6.1.21.
|
Environmental
Matters.
|
58
|
|
6.1.22.
|
Senior
Debt Status.
|
58
|
|
6.1.23.
|
Hedging
Contract Policies.
|
58
|
|
6.1.24.
|
Permitted
Related Business Opportunities.
|
59
|
|
6.1.25.
|
Anti-Terrorism
Laws; Executive Order No. 13224.
|
59
|
|
6.2
|
Continuation
of Representations.
|
59
|
|
7.
|
CONDITIONS
OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
|
60
|
|
7.1
|
First
Loans and Letters of Credit.
|
60
|
|
7.1.1.
|
Officer's
Certificate.
|
60
|
|
7.1.2.
|
Secretary's
Certificate.
|
60
|
|
7.1.3.
|
Opinion
of Counsel.
|
61
|
|
7.1.4.
|
Legal
Details.
|
61
|
|
7.1.5.
|
Payment
of Fees.
|
61
|
|
7.1.6.
|
Consents.
|
61
|
|
7.1.7.
|
Officer's
Certificate Regarding MACs.
|
61
|
|
7.1.8.
|
No
Violation of Laws.
|
62
|
|
7.1.9.
|
No
Actions or Proceedings.
|
62
|
|
7.1.10.
|
Hedging
Contract Policies.
|
62
|
|
7.1.11.
|
Termination
of Commitments and Repayment of Outstanding Indebtedness.
|
62
|
|
7.2
|
Each
Additional Loan or Letter of Credit.
|
62
|
|
8.
|
COVENANTS
|
63
|
|
8.1
|
Affirmative
Covenants.
|
63
|
|
8.1.1.
|
Preservation
of Existence, Etc.
|
63
|
|
8.1.2.
|
Payment
of Liabilities, Including Taxes, Etc.
|
63
|
|
8.1.3.
|
Maintenance
of Insurance.
|
63
|
|
8.1.4.
|
Maintenance
of Properties and Leases.
|
64
|
|
8.1.5.
|
Maintenance
of Patents, Trademarks, Etc.
|
64
|
|
8.1.6.
|
Visitation
Rights.
|
64
|
|
8.1.7.
|
Keeping
of Records and Books of Account.
|
64
|
|
8.1.8.
|
Plans
and Benefit Arrangements.
|
65
|
|
8.1.9.
|
Compliance
With Laws.
|
65
|
|
8.1.10.
|
Use
of Proceeds.
|
65
|
|
8.1.11.
|
Hedging
Contract Policies.
|
66
|
|
8.2
|
Negative
Covenants.
|
66
|
|
8.2.1.
|
Indebtedness.
|
66
|
|
8.2.2.
|
Liens.
|
68
|
|
8.2.3.
|
Guaranties.
|
68
|
|
8.2.4.
|
Loans
and Investments.
|
68
|
|
8.2.5.
|
Liquidations,
Mergers, Consolidations, Acquisitions.
|
69
|
|
8.2.6.
|
Dispositions
of Assets or Subsidiaries.
|
70
|
|
8.2.7.
|
Affiliate
Transactions.
|
71
|
|
8.2.8.
|
Subsidiaries,
Partnerships and Joint Ventures.
|
71
|
|
8.2.9.
|
Continuation
of or Change in Business.
|
72
|
|
8.2.10.
|
Plans
and Benefit Arrangements.
|
72
|
|
8.2.11.
|
Fiscal
Year.
|
72
|
|
8.2.12.
|
Maximum
Leverage Ratio.
|
72
|
|
8.2.13.
|
Minimum
Interest Coverage Ratio.
|
72
|
|
8.2.14.
|
No
Limitation on Dividends and Distributions by Borrower or its
Subsidiaries.
|
72
|
|
8.2.15.
|
Payment
of Dividends; Redemptions.
|
73
|
|
8.2.16.
|
No
Modification of Hedging Contract Policies.
|
73
|
|
8.2.17.
|
Off-Balance
Sheet Financing.
|
73
|
|
8.2.18.
|
Amendments
to NJNG Note Agreement.
|
74
|
|
8.2.19.
|
No
Violation of Anti-Terrorism Laws.
|
74
|
|
8.3
|
Reporting
Requirements.
|
74
|
|
8.3.1.
|
Quarterly
Financial Statements.
|
74
|
|
8.3.2.
|
Annual
Financial Statements.
|
75
|
|
8.3.3.
|
Certificate
of the Borrower.
|
75
|
|
8.3.4.
|
Notice
of Default.
|
76
|
|
8.3.5.
|
Notice
of Litigation.
|
76
|
|
8.3.6.
|
Notice
of Change in Debt Rating.
|
76
|
|
8.3.7.
|
Sale
of Assets.
|
76
|
|
8.3.8.
|
Budgets,
Forecasts, Other Reports and Information.
|
76
|
|
8.3.9.
|
Notices
Regarding Plans and Benefit Arrangements.
|
77
|
|
8.3.10.
|
Other
Information.
|
78
|
|
9.
|
DEFAULT
|
79
|
|
9.1
|
Events
of Default.
|
79
|
|
9.1.1.
|
Payments
Under Loan Documents.
|
79
|
|
9.1.2.
|
Breach
of Warranty.
|
79
|
|
9.1.3.
|
Breach
of Negative Covenants or Visitation Rights.
|
79
|
|
9.1.4.
|
Breach
of Other Covenants.
|
79
|
|
9.1.5.
|
Defaults
in Other Agreements or Indebtedness.
|
79
|
|
9.1.6.
|
Final
Judgments or Orders.
|
80
|
|
9.1.7.
|
Loan
Document Unenforceable.
|
80
|
|
9.1.8.
|
Uninsured
Losses; Proceedings Against Assets.
|
80
|
|
9.1.9.
|
Notice
of Lien or Assessment.
|
80
|
|
9.1.10.
|
Insolvency.
|
81
|
|
9.1.11.
|
Events
Relating to Plans and Benefit Arrangements.
|
81
|
|
9.1.12.
|
Cessation
of Business.
|
81
|
|
9.1.13.
|
Change
of Control.
|
81
|
|
9.1.14.
|
Involuntary
Proceedings.
|
82
|
|
9.1.15.
|
Voluntary
Proceedings.
|
82
|
|
9.2
|
Consequences
of Event of Default.
|
82
|
|
9.2.1.
|
Events
of Default Other Than Bankruptcy, Insolvency or Reorganization
Proceedings.
|
82
|
|
9.2.2.
|
Bankruptcy,
Insolvency or Reorganization Proceedings.
|
83
|
|
9.2.3.
|
Set-off.
|
83
|
|
9.2.4.
|
Suits,
Actions, Proceedings.
|
83
|
|
9.2.5.
|
Application
of Proceeds; Collateral Sharing.
|
84
|
|
9.2.6.
|
Other
Rights and Remedies.
|
84
|
|
10.
|
THE
AGENT
|
85
|
|
10.1
|
Appointment.
|
85
|
|
10.2
|
Delegation
of Duties.
|
85
|
|
10.3
|
Nature
of Duties; Independent Credit Investigation.
|
85
|
|
10.4
|
Actions
in Discretion of Agent; Instructions From the Lenders.
|
86
|
|
10.5
|
Reimbursement
and Indemnification of Agent by the Borrower.
|
86
|
|
10.6
|
Exculpatory
Provisions; Limitation of Liability.
|
87
|
|
10.7
|
Reimbursement
and Indemnification of Agent by Lenders.
|
88
|
|
10.8
|
Reliance
by Agent.
|
88
|
|
10.9
|
Notice
of Default.
|
89
|
|
10.10
|
Notices.
|
89
|
|
10.11
|
Lenders
in Their Individual Capacities; Agents in Its Individual
Capacity.
|
89
|
|
10.12
|
Holders
of Notes.
|
89
|
|
10.13
|
Equalization
of the Lenders.
|
90
|
|
10.14
|
Resignation
of the Agent.
|
90
|
|
10.15
|
The
Agent's Fee.
|
91
|
|
10.16
|
Availability
of Funds.
|
91
|
|
10.17
|
Calculations.
|
92
|
|
10.18
|
Beneficiaries.
|
92
|
|
10.19
|
No
Reliance on the Agent's Customer Identification Program.
|
92
|
|
11.
|
MISCELLANEOUS
|
92
|
|
11.1
|
Modifications,
Amendments or Waivers.
|
92
|
|
11.1.1.
|
Increase
of Revolving Credit Commitments; Extension of Expiration
Date.
|
93
|
|
11.1.2.
|
Release
of Collateral or Guarantor.
|
93
|
|
11.1.3.
|
Miscellaneous.
|
93
|
|
11.2
|
No
Implied Waivers; Cumulative Remedies; Writing Required.
|
94
|
|
11.3
|
Reimbursement
and Indemnification of Lenders by the Borrower; Limitation on Damages;
Taxes.
|
94
|
|
11.4
|
Holidays.
|
95
|
|
11.5
|
Funding
by Branch, Subsidiary or Affiliate.
|
96
|
|
11.5.1.
|
Notional
Funding.
|
96
|
|
11.5.2.
|
Actual
Funding.
|
96
|
|
11.6
|
Notices;
Lending Offices.
|
96
|
|
11.7
|
Severability.
|
97
|
|
11.8
|
Governing
Law.
|
98
|
|
11.9
|
Prior
Understanding.
|
98
|
|
11.10
|
Duration;
Survival.
|
98
|
|
11.11
|
Successors
and Assigns; Joinder of a Lender.
|
98
|
|
11.12
|
Confidentiality.
|
100
|
|
11.12.1.
|
General.
|
100
|
|
11.12.2.
|
Sharing
Information With Affiliates of the Lenders.
|
100
|
|
11.13
|
Counterparts.
|
101
|
|
11.14
|
The
Agent's or the Lenders' Consent.
|
101
|
|
11.15
|
Exceptions.
|
101
|
|
11.16
|
WAIVER
OF JURY TRIAL.
|
101
|
|
11.17
|
JURISDICTION
AND VENUE.
|
102
|
|
11.18
|
Certifications
From Lenders and Participants.
|
102
|
|
11.18.1.
|
Tax
Withholding.
|
102
|
|
11.18.2.
|
USA
Patriot Act.
|
103
|
PRN
376736/8 - -
LIST
OF SCHEDULES AND EXHIBITS
SCHEDULES
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SCHEDULE
1.1(A)
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PRICING
GRID
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SCHEDULE
1.1(B)
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COMMITMENTS
OF LENDERS AND ADDRESSES FOR
NOTICES
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SCHEDULE
1.1(P)
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PERMITTED
LIENS
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SCHEDULE
2.9.1
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EXISTING
LETTERS OF CREDIT
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SCHEDULE
6.1.2
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SUBSIDIARIES
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SCHEDULE
6.1.12
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CONSENTS
AND APPROVALS
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SCHEDULE
6.1.23
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HEDGING
CONTRACT POLICIES
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SCHEDULE
6.1.24
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PERMITTED BUSINESS OPPORTUNITIES
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SCHEDULE
8.2.1
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EXISTING
INDEBTEDNESS
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EXHIBITS
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EXHIBIT
1.1(A)
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ASSIGNMENT
AND ASSUMPTION AGREEMENT
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EXHIBIT
1.1(B)
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LENDER
JOINDER
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EXHIBIT
1.1(R)
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REVOLVING
CREDIT NOTE
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EXHIBIT
1.1(S)
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SWING
LOAN NOTE
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EXHIBIT
2.4
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LOAN
REQUEST
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EXHIBIT
2.5
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SWING
LOAN REQUEST
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EXHIBIT
5.5
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COMMITMENT
REDUCTION NOTICE
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EXHIBIT
7.1.3(A)
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OPINION
OF COUNSEL
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EXHIBIT
7.1.3(B)
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OPINION
OF IN-HOUSE COUNSEL
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EXHIBIT
8.2.5
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ACQUISITION
COMPLIANCE CERTIFICATE
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EXHIBIT
8.3.3
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COMPLIANCE
CERTIFICATE
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PRN
376736/8 - -
CREDIT
AGREEMENT
THIS
CREDIT AGREEMENT is dated as of December 11, 2009, and is made by and among
NEW JERSEY NATURAL GAS
COMPANY, a New Jersey corporation, the LENDERS (as hereinafter
defined), JP MORGAN CHASE BANK,
N.A., in its capacity as a syndication agent, U.S. BANK NATIONAL ASSOCIATION and
TORONTO DOMINION (NEW YORK)
LLC, each in its capacity as a documentation agent, PNC BANK, NATIONAL
ASSOCIATION, in its capacity as administrative agent for the Lenders
under this Agreement.
BACKGROUND
WHEREAS, the Borrower, the
Agent, and certain other Persons are parties to a $250,000,000.00 Credit
Agreement, dated December 16, 2004, and thereafter amended ( the "Existing
Agreement") whereby the lenders thereunder have provided the Borrower
with a revolving credit facility on the terms and conditions therein contained;
and
WHEREAS, the Borrower has
requested that the Lenders provide a new revolving credit facility to the
Borrower in an aggregate principal amount not to exceed $200,000,000.00, subject
to increase as provided herein; and
WHEREAS, the new revolving
credit facility shall be used for refinancing all indebtedness under the
Existing Agreement and general corporate purposes of the Borrower;
and
WHEREAS,
the Lenders are willing to provide such new revolving credit facility upon the
terms and conditions hereinafter set forth;
NOW,
THEREFORE, the parties hereto, in consideration of their mutual covenants and
agreements hereinafter set forth and intending to be legally bound hereby,
covenant and agree as follows:
1. CERTAIN
DEFINITIONS
1.1 Certain
Definitions.
In
addition to words and terms defined elsewhere in this Agreement, the following
words and terms shall have the following meanings, respectively, unless the
context hereof clearly requires otherwise:
Acquired
Person means a Person or business acquired by the Borrower or any
Subsidiary of the Borrower in a transaction which is a Permitted
Acquisition.
Acquisition
Compliance Certificate has the meaning assigned to that term in Section
8.2.5 [Liquidations, Mergers, Consolidations, Acquisitions].
Additional
Lender has the meaning assigned to such term in Section
11.11(d).
Affiliate
as to any Person means any other Person (a) which directly or indirectly
controls, is controlled by, or is under common control with such Person,
(b) which beneficially owns or holds 10% or more of any class of the voting
or other equity interests of such Person, or (c) 10% or more of any class
of voting interests or other equity interests of which is beneficially owned or
held, directly or indirectly, by such Person. Control, as used in
this definition, shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ownership of voting securities, by contract or otherwise,
including the power to elect a majority of the directors or trustees of a
corporation or trust, as the case may be.
Agent
means PNC Bank, National Association, and its successors and
assigns.
Agent's
Fee has the meaning assigned to such term in Section 10.15
[Agent's Fee].
Agent's
Letter has the meaning assigned to such term in Section 10.15 [Agent's
Fee].
Agreement
means this Credit Agreement, as the same may be supplemented or amended from
time to time, including all schedules and exhibits.
Anti-Terrorism
Laws means any Laws relating to terrorism or money laundering, including
Executive Order No. 13224, the USA Patriot Act, the Laws comprising or
implementing the Bank Secrecy Act, and the Laws administered by the United
States Treasury Department's Office of Foreign Asset Control (as any of the
foregoing Laws may from time to time be amended, renewed, extended, or
replaced).
Applicable
Commitment Fee Rate means the percentage rate per annum at the indicated
level of Debt Rating in the pricing grid on Schedule
1.1(A)
below the heading "Commitment Fee." The Applicable Commitment Fee
Rate shall be computed in accordance with the parameters set forth on Schedule
1.1(A),
provided however that if the
Borrower's Debt Rating is determined by Fitch, Inc. or any other nationally
recognized statistical agency pursuant to the definition of "Debt Rating"
hereunder, the second column (Debt Rating Standard & Poor's and Moody's) of
the pricing grid set forth on Schedule
1.1(A) shall be modified by the Agent upon written notice to the Borrower
to reflect such replacement of Moody's or Standard & Poor's as the
applicable rating agencies hereunder and to replace the Debt Rating Levels with
the corresponding levels of Fitch or such other nationally recognized
statistical agency.
Applicable
Letter of Credit Fee Rate means the percentage rate per annum at the
indicated level of Debt Rating in the pricing grid on Schedule
1.1(A)
below the heading "Letter of Credit Fee." The Applicable Letter of
Credit Fee Rate shall be computed in accordance with the parameters set forth on
Schedule
1.1(A),
provided however that if the
Borrower's Debt Rating is determined by Fitch, Inc. or any other nationally
recognized statistical agency pursuant to the definition of "Debt Rating"
hereunder, the second column (Debt Rating Standard & Poor's and Moody's) of
the pricing grid set forth on Schedule
1.1(A) shall be modified by the Agent upon written notice to the Borrower
to reflect such replacement of Moody's or Standard & Poor's as the
applicable rating agencies hereunder and to replace the Debt Rating Levels with
the corresponding levels of Fitch or such other nationally recognized
statistical agency.
Applicable
Margin means, as applicable:
(a) the
percentage spread to be added to the Base Rate under the Base Rate Option at the
indicated level of Debt Rating in the pricing grid on Schedule
1.1(A)
below the heading "Base Rate Spread," as the same may be modified in accordance
with the terms hereof, or
(b) the
percentage spread to be added to the Euro-Rate under the Euro-Rate Option at the
indicated level of Debt Rating in the pricing grid on Schedule
1.1(A)
below the heading "Euro-Rate Spread," as the same may be modified in accordance
with the terms hereof,
The
Applicable Margin shall be computed in accordance with the parameters set forth
on Schedule 1.1(A);
provided, however that if the
Borrower's Debt Rating is determined by Fitch, Inc. or any other nationally
recognized statistical agency, pursuant hereto, the second column (Debt Rating
Standard & Poor's and Moody's) of the Applicable Margin pricing grid
contained in Schedule
1.1(A) shall be modified by the Agent upon written notice to the Borrower
to reflect such replacement of Moody's or Standard & Poor's as the
applicable rating agencies hereunder and to replace the Debt Rating Levels with
the corresponding levels of Fitch or such other nationally recognized
statistical agency.
Approved
Fund means any fund that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
of business and that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender, or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.
Assignment
and Assumption Agreement means an Assignment and Assumption Agreement by
and among a Purchasing Lender, a Transferor Lender and the Agent, as Agent and
on behalf of the remaining Lenders, substantially in the form of Exhibit
1.1(A).
Authorized
Officer means those individuals, designated by written notice to the
Agent from the Borrower, authorized to execute notices, reports and other
documents on behalf of the Borrower required hereunder. The Borrower
may amend such list of individuals from time to time by giving written notice of
such amendment to the Agent.
Base
Rate means the greatest of (a) the interest rate per annum announced
from time to time by the Agent at its Principal Office as its then prime rate,
which rate may not be the lowest rate then being charged commercial borrowers by
the Agent, (b) the Federal Funds Open Rate plus 1/2% per annum, and (c) the
Daily Euro-Rate plus 1.00%.
Base Rate
Option means the option of the Borrower to have Revolving Credit Loans
bear interest at the rate and under the terms and conditions set forth in Section
4.1.1(a) [Base Rate Option].
Benefit
Arrangement means an "employee benefit plan," within the meaning of
Section 3(3) of ERISA, which is neither a Plan, a Multiple Employer Plan,
nor a Multiemployer Plan and which is maintained, sponsored or otherwise
contributed to by any member of the ERISA Group.
Blocked
Person has the meaning assigned to such term in Section
6.1.25 [Anti-Terrorism Laws; Executive Order No. 13224].
Borrower
means New Jersey Natural Gas Company, a corporation organized and existing under
the laws of the State of New Jersey.
Borrowing
Date means, with respect to any Loan, the date for the making thereof or
the renewal or conversion thereof at or to the same or a different Interest Rate
Option, which shall be a Business Day.
Borrowing
Tranche means specified portions of Loans outstanding as
follows: (a) any Loans to which a Euro-Rate Option applies which
become subject to the same Interest Rate Option under the same Loan Request by
the Borrower and which have the same Interest Period shall constitute one
Borrowing Tranche, and (b) all Loans to which a Base Rate Option applies
shall constitute one Borrowing Tranche.
Business
Day means any day other than a Saturday or Sunday or a legal holiday on
which commercial banks are authorized or required to be closed for business in
Pittsburgh, Pennsylvania and if the applicable Business Day relates to any Loan
to which the Euro-Rate Option applies, such day must also be a day on which
dealings are carried on in the London interbank market.
CIP
Regulations has the meaning given to such term in Section
10.19 [No Reliance in the Agent's Customer Identification
Program].
Closing
Date means the Business Day on which this Agreement is fully executed and
becomes effective.
Collateral
Agent has the meaning given to such term in Section
9.2.5.2 [Collateral Sharing].
Collateral
Documents has the meaning given to such term in Section
9.2.5.2 [Collateral Sharing].
Commercial
Letter of Credit means any letter of credit which is issued in respect of
the purchase of goods or services by the Borrower in the ordinary course of its
business.
Commitment
means as to any Lender its Revolving Credit Commitment and, in the case of the
Agent, its Swing Loan Commitment, and Commitments shall
mean the aggregate of the Revolving Credit Commitments and Swing Loan Commitment
of all of the Lenders.
Commitment
Fee has the meaning given to such term in Section
2.3 [Commitment Fee].
Commitment
Reduction Notice has the meaning given to such term in Section
5.5 [Voluntary Commitment Reductions].
Compliance
Certificate has the meaning assigned to such term in Section
8.3.3
[Certificate of the Borrower].
Consideration
means with respect to any Permitted Acquisition, the aggregate of (a) the
cash paid by the Borrower, directly or indirectly, to the seller in connection
therewith, (b) the Indebtedness incurred or assumed by the Borrower,
whether in favor of the seller or otherwise and whether fixed or contingent,
(c) any Guaranty given or incurred by the Borrower in connection therewith,
and (d) any other consideration given or obligation incurred by the
Borrower in connection therewith.
Consolidated
Income from Operations for any period of determination means (a) the sum
of net income (provided that there shall be excluded from net
income: (i) any extraordinary items of gain or loss (including,
without limitation, those items created by mandated changes in accounting
treatment), and (ii) any gain or loss of any Person accounted for on the
equity method except to the extent of cash distributions received by the
Borrower or any Subsidiary of the Borrower during the period of determination
with respect to any gain of any Person accounted for on the equity method),
depreciation, amortization, other non-cash charges to net income, interest
expense and income tax expense minus (b) non-cash credits to net income, in
each case of the Borrower and its Subsidiaries for such period determined and
consolidated in accordance with GAAP.
Consolidated
Interest Expense for any period of determination means
interest expense for such period of the Borrower and its Subsidiaries determined
on a consolidated basis in accordance with GAAP.
Consolidated
Shareholders' Equity means as of any date of determination the sum of the
amounts under the headings "Common Shareholders' Equity" and "Preferred
Shareholders' Equity" on the balance sheet, prepared in accordance with GAAP,
for the Borrower and its Subsidiaries on a consolidated basis as of such date of
determination.
Consolidated
Total Capitalization means as of any date of determination the sum of (a)
Consolidated Total Indebtedness, plus (b) Consolidated Shareholders'
Equity.
Consolidated
Total Indebtedness means as of any date of determination total
Indebtedness, without duplication, of the Borrower and its
Subsidiaries.
Contamination
means the presence or release or threat of release of Regulated Substances in,
on, under or emanating to or from the Property, which pursuant to Environmental
Laws requires notification or reporting to an Official Body, or which pursuant
to Environmental Laws requires the performance of a Remedial Action or which
otherwise constitutes a violation of Environmental Laws.
Daily
Euro-Rate means for any day, the rate per annum determined by the Agent
by dividing (a) the Published Rate by (b) a number equal to 1.00 minus the
Euro-Rate Reserve Percentage on such day.
Debt
Rating means the rating of the Borrower's senior secured long-term debt
by each of Standard & Poor's and Moody's; provided, however, at the
option of the Borrower from time to time and with the consent of the Agent which
will not be unreasonably withheld or delayed, either or both Standard &
Poor's and Moody's shall be replaced by Fitch, Inc. or any other nationally
recognized statistical rating agency that is then rating the Borrower's senior
secured Indebtedness.
Defaulting
Lender means any Lender that (a) has failed to fund any portion of the
Loans, participations with respect to Letters of Credit, or participations in
Swing Loans required to be funded by it hereunder within one (1) Business Day of
the date required to be funded by it hereunder unless such failure has been
cured and all interest accruing as a result of such failure has been fully paid
in accordance with the terms hereof, (b) has otherwise failed to pay over to the
Agent or any other Lender any other amount required to be paid by it hereunder
within one (1) Business Day of the day when due, unless the subject of a good
faith dispute or unless such failure has been cured and all interest accruing as
a result of such failure has been fully paid in accordance with the terms
hereof, or (c) has since the date of this Agreement been deemed insolvent by an
Official Body or become the subject of a bankruptcy, receivership,
conservatorship or insolvency proceeding.
Delinquent
Lender has the meaning assigned to such term in Section
5.2 [Pro Rata Treatment of Lenders; Sharing of Payments; Agent's
Presumptions].
Dollar,
Dollars, U.S. Dollars and the symbol $ means lawful money
of the United States of America.
Drawing
Date has the meaning assigned to such term in Section 2.9.3.2.
Environmental
Complaint means any (a) written notice of non-compliance or violation,
citation or order relating in any way to any Environmental Law, Environmental
Permit, Contamination or Regulated Substance; (b) civil, criminal,
administrative or regulatory investigation instituted by an Official Body
relating in any way to any Environmental Law, Environmental Permit,
Contamination or Regulated Substance; (c) administrative, regulatory or judicial
action, suit, claim or proceeding instituted by any Person or Official Body or
any other written notice of liability or potential liability from any Person or
Official Body, in either instance, relating to or setting forth allegations or a
cause of action for personal injury (including but not limited to death),
property damage, natural resource damage, contribution or indemnity for the
costs associated with the performance of Remedial Actions, direct recovery for
the costs associated with the performance of Remedial Actions, liens or
encumbrances attached to or recorded or levied against property for the costs
associated with the performance of Remedial Actions, civil or administrative
penalties, criminal fines or penalties or declaratory or equitable relief
arising under any Environmental Laws; or (d) subpoena, request for information
or other written notice or demand of any type issued by an Official Body
pursuant to any Environmental Laws.
Environmental
Laws means all federal, state, local and foreign Laws (including, but not
limited to, the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. §§ 9601 et seq., the Resource Conservation and Recovery Act,
42 U.S.C. § 6901 et seq., the Hazardous Materials Transportation Act, 49
U.S.C. § 1801 et seq., the Toxic Substances Control Act, 15 U.S.C.
§ 2601 et seq., the Federal Water Pollution Control Act, 33 U.S.C.
§§ 1251 et seq., the Federal Safe Drinking Water Act, 42 U.S.C.
§§ 300f-300j, the Federal Air Pollution Control Act, 42 U.S.C. § 7401
et seq., the Oil Pollution Act, 33 U.S.C. § 2701 et seq., the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §§ 136 to 136y, the
Occupational Safety and Health Act, 29 U.S.C. § 651 et seq., each as
amended, and any regulations promulgated or any equivalent state or local Law,
and any amendments thereto) and any final, non-appealable consent
decrees, consent orders, consent agreements, settlement agreements, judgments or
orders, or binding directives, policies or programs, issued by or entered into
with an Official Body pertaining or relating to: (a) pollution or pollution
control; (b) protection of human health from exposure to Regulated
Substances; (c) protection of the environment and/or natural resources;
(d) protection of employee safety in the workplace and protection of
employees from exposure to Regulated Substances in the workplace (but excluding
workers compensation and wage and hour Laws); (e) the presence, use,
management, generation, manufacture, processing, extraction, treatment,
recycling, refining, reclamation, labeling, sale, transport, storage,
collection, distribution, disposal or release or threat of release of Regulated
Substances; (f) the presence of Contamination; (g) the protection of
endangered or threatened species; and (h) the protection of Environmentally
Sensitive Areas.
Environmental
Permits means all permits, licenses, bonds or other forms of financial
assurances, consents, registrations, identification numbers, approvals or
authorizations required under Environmental Laws (a) to own, occupy or
maintain the Property; (b) for the operations and business activities
of the Borrower and any of its Subsidiaries; or (c) for the performance of
a Remedial Action.
Environmental
Records means all notices, reports, records, plans, applications, forms
or other filings relating or pertaining to the Property, Contamination, the
performance of a Remedial Action and the operations and business activities of
the Borrower and any of its Subsidiaries which pursuant to Environmental Laws,
Environmental Permits or at the request or direction of an Official Body either
must be submitted to an Official Body or which otherwise must be
maintained.
Environmentally
Sensitive Area means (a) any wetland as defined by applicable
Environmental Laws; (b) any area designated as a coastal zone pursuant to
applicable Laws, including Environmental Laws; (c) any area of historic or
archeological significance or scenic area as defined or designated by applicable
Laws, including Environmental Laws; (d) habitats of endangered species or
threatened species as designated by applicable Laws, including Environmental
Laws; or (e) a floodplain or other flood hazard area as defined pursuant to any
applicable Laws.
ERISA
means the Employee Retirement Income Security Act of 1974, as the same may be
amended or supplemented from time to time, and any successor statute of similar
import, and the rules and regulations thereunder, as from time to time in
effect.
ERISA
Group means the Borrower and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control and all other entities which, together with the Borrower, are
treated as a single employer under Section 414 of the Internal Revenue
Code.
Euro-Rate
means, with respect to the Loans comprising any Borrowing Tranche to which the
Euro-Rate Option applies for any Interest Period, the interest rate per annum
determined by the Agent by dividing (the resulting quotient rounded upwards, if
necessary, to the nearest 1/100th of 1% per annum) (a) the rate which appears on
the Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that
displays rates at which US dollar deposits are offered by leading banks in the
London interbank deposit market), or the rate which is quoted by another source
selected by the Agent which has been approved by the British Bankers'
Association as an authorized information vendor for the purpose of displaying
rates at which US Dollar deposits are offered by leading banks in the London
interbank deposit market (an "Alternate
Source"), at approximately 11:00 a.m., London time, two (2) Business Days
prior to the commencement of such Interest Period as the London interbank
offered rate for U.S. Dollars for an amount having a borrowing date and a
maturity comparable to such Interest Period (or if there shall at any time, for
any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or
any Alternate Source, a comparable replacement rate determined by the Agent at
such time (which determination shall be conclusive absent manifest error)), by
(b) a number equal to 1.00 minus the Euro-Rate Reserve
Percentage. Euro-Rate may also be expressed by the following
formula:
London
interbank offered rate quoted by Bloomberg or appropriate successor as shown
on
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Euro-Rate
=
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Bloomberg Page
BBAM1
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1.00
- Euro-Rate Reserve Percentage
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The
Euro-Rate shall be adjusted with respect to any Loan to which the Euro-Rate
Option applies that is outstanding on the effective date of any change in the
Euro-Rate Reserve Percentage as of such effective date. The Agent
shall give prompt notice to the Borrower of the Euro-Rate as determined or
adjusted in accordance herewith, which determination shall be conclusive absent
manifest error.
Euro-Rate
Option means the option of the Borrower to have Revolving Credit Loans
bear interest at the rate and under the terms and conditions set forth in Section
4.1.1(b) [Euro-Rate Option].
Euro-Rate
Reserve Percentage means as of any day the maximum percentage in effect
on such day as prescribed by the Board of Governors of the Federal Reserve
System (or any successor) for determining the reserve requirements (including
supplemental, marginal and emergency reserve requirements) with respect to
eurocurrency funding (currently referred to as "Eurocurrency
Liabilities").
Event of
Default shall mean any of the events described in Section 9.1
[Events of Default] and referred to therein as an "Event of
Default."
Executive
Order No. 13224 means the Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001, as the same has been, or shall
hereafter be, renewed, extended, amended or replaced.
Existing
Agreement has the meaning given to such term in the Background section
hereof.
Existing
Letters of Credit has the meaning assigned to such term in Section
2.9.1 [Issuance of Letters of Credit].
Expiration
Date means, with respect to the Revolving Credit Commitments, December
11, 2012.
Federal
Funds Effective Rate for any day means the rate per annum (based on a
year of 360 days and actual days elapsed and rounded upward to the nearest 1/100
of 1%) announced by the Federal Reserve Bank of New York (or any successor) on
such day as being the weighted average of the rates on overnight federal funds
transactions arranged by federal funds brokers on the previous trading day, as
computed and announced by such Federal Reserve Bank (or any successor) in
substantially the same manner as such Federal Reserve Bank computes and
announces the weighted average it refers to as the "Federal Funds Effective
Rate" as of the date of this Agreement; provided, if such
Federal Reserve Bank (or its successor) does not announce such rate on any day,
the "Federal Funds Effective Rate" for such day shall be the Federal Funds
Effective Rate for the last day on which such rate was announced.
Federal
Funds Open Rate for any day means the rate per annum (based on a year of
360 days and actual days elapsed) determined by the Agent in accordance with its
usual procedures (which determination shall be conclusive absent manifest error)
to be the "Open" rate for federal funds transactions as of the opening of
business for federal funds transactions among members of the Federal Reserve
System arranged by federal funds brokers on such day, as quoted by Garvin
Guybutler, any successor entity thereto, or any other broker selected by the
Agent, as set forth on the applicable Telerate display page; provided, however,
that if such day is not a Business Day, the Federal Funds Open Rate for such day
shall be the "Open" rate on the immediately preceding Business Day, or if no
such rate shall be quoted by a federal funds broker at such time, such other
rate as determined by the Agent in accordance with its usual
procedures.
GAAP
means generally accepted accounting principles as are in effect in the United
States from time to time, subject to the provisions of Section 1.3
[Accounting Principles], and applied on a consistent basis both as to
classification of items and amounts.
Governmental
Acts has the meaning assigned to such term in Section 2.9.8.
Guaranty
of any Person means any obligation of such Person guaranteeing or in effect
guaranteeing any liability or obligation of any other Person in any manner,
whether directly or indirectly, including any agreement to indemnify or hold
harmless any other Person, any performance bond or other suretyship arrangement
and any other form of assurance against loss, except endorsement of negotiable
or other instruments for deposit or collection in the ordinary course of
business.
Hedging
Contract Policies means the written internal policies and procedures of
the Borrower with respect to hedging or trading of gas contracts or other
commodity, hedging contracts of any kind, or any derivatives or other similar
financial instruments, as in effect on the date of this Agreement and as
hereafter amended in accordance with Section 8.2.16
[No Modification of Hedging Contract Policies], a copy of which has been
delivered to the Agent and each Lender.
Hedging
Transaction means any transaction entered into by the Borrower or any of
its Subsidiaries in accordance with the Hedging Contract Policies.
Historical
Statements has the meaning assigned to such term in Section 6.1.8(a)
[Historical Statements].
Hybrid
Security means any of the following: (a) beneficial interests issued by a
trust which constitutes a Subsidiary of the Borrower, substantially all of the
assets of which trust are unsecured Indebtedness of the Borrower or any
Subsidiary of the Borrower or proceeds thereof, and all payments of which
Indebtedness are required to be, and are, distributed to the holders of
beneficial interests in such trust promptly after receipt by such trust, or (b)
any shares of capital stock or other equity interest that, other than solely at
the option of the issuer thereof, by their terms (or by the terms of any
security into which they are convertible or exchangeable) are, or upon the
happening of an event or the passage of time would be, required to be redeemed
or repurchased, in whole or in part, or have, or upon the happening of an event
or the passage of time would have, a redemption or similar payment.
Inactive
Subsidiary means, at any time, any Subsidiary of any Person, which
Subsidiary (a) does not conduct any business or have operations, and
(b) does not have total assets with a net book value, as of any date of
determination, in excess of $100,000.00.
Indebtedness
means, as to any Person at any time, any and all indebtedness, obligations or
liabilities (whether matured or unmatured, liquidated or unliquidated, direct or
indirect, absolute or contingent, or joint or several) of such Person for or in
respect of: (a) borrowed money, (b) amounts raised under or
liabilities in respect of any note purchase or acceptance credit facility,
(c) reimbursement obligations (contingent or otherwise) under any letter of
credit, currency swap agreement, interest rate swap, cap, collar or floor
agreement or other interest rate or currency exchange rate management device,
(d) any other transaction (including forward sale or purchase agreements,
capitalized leases and conditional sales agreements) having the commercial
effect of a borrowing of money entered into by such Person to finance its
operations or capital requirements (but not including trade payables and accrued
expenses incurred in the ordinary course of business which are not represented
by a promissory note or other evidence of indebtedness and which are not more
than thirty (30) days past due), (e) any Hedging Transaction, to the extent that
any indebtedness, obligations or liabilities of such Person in respect thereof
constitutes "indebtedness" as determined in accordance with GAAP, (f) any
Guaranty of any Hedging Transaction described in the immediately preceding
clause (e), (g) any Guaranty of Indebtedness, (h) any Hybrid Security
described in clause (a) of the definition of Hybrid Security, or (i) the
mandatory repayment obligation of the issuer of any Hybrid Security described in
clause (b) of the definition of Hybrid Security.
Ineligible
Security means any security which may not be underwritten or dealt in by
member banks of the Federal Reserve System under Section 16 of the Banking
Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.
Insolvency
Proceeding means, with respect to any Person, (a) a case, action or
proceeding with respect to such Person (i) before any court or any other
Official Body under any bankruptcy, insolvency, reorganization or other similar
Law now or hereafter in effect, or (ii) for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator, conservator (or similar
official) of such Person or otherwise relating to the liquidation, dissolution,
winding-up or relief of such Person, or (b) any general assignment for the
benefit of creditors, composition, marshaling of assets for creditors, or other,
similar arrangement in respect of such Person's creditors generally or any
substantial portion of its creditors; undertaken under any Law.
Interest
Period means the period of time selected by the Borrower in connection
with (and to apply to) any election permitted hereunder by the Borrower to have
Revolving Credit Loans bear interest under the Euro-Rate
Option. Subject to the last sentence of this definition, such period
shall be one, two, three or six Months, and solely with approval of the Agent a
shorter period. Such Interest Period shall commence on the effective
date of such Interest Rate Option, which shall be (a) the Borrowing Date if the
Borrower is requesting new Loans, or (b) the date of renewal of or conversion to
the Euro-Rate Option if the Borrower is renewing or converting to the Euro-Rate
Option applicable to outstanding Loans. Notwithstanding the second
sentence hereof: (i) any Interest Period which would otherwise end on a date
which is not a Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day, and (ii) the
Borrower shall not select, convert to or renew an Interest Period for any
portion of the Loans that would end after the Expiration Date.
Interest
Rate Hedge means an interest rate exchange, collar, cap, swap, adjustable
strike cap, adjustable strike corridor or similar agreements entered into by the
Borrower or its Subsidiaries in order to provide protection to, or minimize the
impact upon, the Borrower and/or its Subsidiaries of increasing floating rates
of interest applicable to Indebtedness.
Interest
Rate Option means any Euro-Rate Option or Base Rate Option.
Internal
Revenue Code means the Internal Revenue Code of 1986, as the same may be
amended or supplemented from time to time, and any successor statute of similar
import, and the rules and regulations thereunder, as from time to time in
effect.
Investment
has the meaning assigned to such term in Section
8.2.4 [Loans and Investments].
ISP
98 has the meaning given to such term in Section
11.8 [Governing Law].
IRH
Provider has the meaning assigned to such term in Section 9.2.5.2
[Collateral Sharing].
Issuing
Lender has the meaning assigned to such term in Section
10.14 [Resignation of the Agent].
Labor
Contracts means all collective bargaining agreements among the Borrower
or any Subsidiary of the Borrower and unions representing employees of the
Borrower or any Subsidiary of the Borrower.
Law
means any law (including common law), constitution, statute, treaty, regulation,
rule, ordinance, binding opinion, release, ruling, order, injunction, writ,
decree, bond, judgment, authorization or approval, lien or award of or
settlement agreement with any Official Body.
Lender
Joinder means a Lender Joinder substantially in the form of Exhibit
1.1(B).
Lender
Provided Interest Rate Hedge means an Interest Rate Hedge which is
provided by any Lender or an Affiliate of a Lender and that meets the following
requirements: such Interest Rate Hedge (a) is documented in a
standard International Swap Dealer Association Agreement, (b) provides for the
method of calculating the reimbursable amount of the provider's credit exposure
in a reasonable and customary manner, and (c) is entered into for hedging
(rather than speculative) purposes. The liabilities of the Borrower
to the provider of any Lender-Provided Interest Rate Hedge shall be
"Obligations" hereunder and otherwise treated as Obligations for the purposes of
each of the other Loan Documents.
Lenders
means the financial institutions named on Schedule
1.1(B),
any Person that becomes a Lender pursuant to Section
2.11 [Right to Increase Commitment], and their respective successors and
assigns as permitted hereunder, each of which is referred to herein as a
Lender.
Letter of
Credit has the meaning assigned to such term in Section 2.9.1
[Issuance of Letters of Credit].
Letter of
Credit Borrowing has the meaning assigned to such term in Section
2.9.3.4.
Letter of
Credit Fee has the meaning assigned to such term in Section 2.9.2 [Letter of Credit
Fees].
Letter of
Credit Sublimit means $20,000,000.00.
Letters
of Credit Outstanding means at any time the sum of (a) the aggregate
undrawn face amount of outstanding Letters of Credit and (b) the aggregate
amount of all unpaid and outstanding Reimbursement Obligations and Letter of
Credit Borrowings.
Lien
means any mortgage, deed of trust, pledge, lien, security interest, charge or
other encumbrance or security arrangement of any nature whatsoever, whether
voluntarily or involuntarily given, including any conditional sale or title
retention arrangement, and any assignment, deposit arrangement or lease intended
as, or having the effect of, security and any filed financing statement or other
notice of any of the foregoing (whether or not a lien or other encumbrance is
created or exists at the time of the filing).
LLC
Interests has the meaning given to such term in Section 6.1.2
[Subsidiaries].
Loan
Documents means this Agreement, the Agent's Letter, the Notes, and any
other instruments, certificates or documents delivered or contemplated to be
delivered hereunder or thereunder or in connection herewith or therewith, as the
same may be supplemented or amended from time to time in accordance herewith or
therewith, and Loan
Document shall mean any of the Loan Documents.
Loan
Request means a request for a Revolving Credit Loan or a request to
select, convert to or renew a Base Rate Option or Euro-Rate Option with respect
to an outstanding Revolving Credit Loan in accordance with Sections
2.4 [Revolving Credit Loan Requests], 2.5
[Swing Loan Requests], 4.1
[Interest Rate Options] and 4.2
[Interest Periods].
Loans
means collectively and Loan
means separately all Revolving Credit Loans and Swing Loans or any Revolving
Credit Loan or Swing Loan.
Material
Adverse Change means any set of circumstances or events which
(a) has or could reasonably be expected to have any material adverse effect
whatsoever upon the validity or enforceability of this Agreement or any other
Loan Document, (b) is or could reasonably be expected to be material and
adverse to the business, properties, assets, financial condition, results of
operations or prospects of the Borrower or the Borrower and its Subsidiaries
taken as a whole, (c) impairs materially or could reasonably be expected to
impair materially the ability of the Borrower or the Borrower and its
Subsidiaries taken as a whole to duly and punctually pay the Indebtedness or
otherwise perform the obligations in accordance with the Loan Documents, or
(d) impairs materially or could reasonably be expected to impair materially
the ability of the Agent or any of the Lenders, to the extent permitted, to
enforce their legal remedies pursuant to this Agreement or any other Loan
Document.
Month,
with respect to an Interest Period under the Euro-Rate Option, means the
interval between the days in consecutive calendar months numerically
corresponding to the first day of such Interest Period. If any
Euro-Rate Interest Period begins on a day of a calendar month for which there is
no numerically corresponding day in the month in which such Interest Period is
to end, the final month of such Interest Period shall be deemed to end on the
last Business Day of such final month.
Moody's
means Moody's Investors Service, Inc. and its successors.
Mortgage
Indenture means that certain Indenture of Mortgage and Deed of Trust
dated April 1, 1952 from the Borrower to BNY Midwest Trust Company, as successor
to Harris Trust and Savings Bank, Trustee, as heretofore and hereafter amended,
modified and supplemented.
Multiemployer
Plan means any "employee benefit plan" within the meaning of Section 3(3)
of ERISA, which is a "multiemployer plan" within the meaning of
Section 4001(a)(3) of ERISA and to which the Borrower or any member of the
ERISA Group is then making or accruing an obligation to make contributions or,
solely for the purposes of Section 6.1.19, within the preceding five Plan years,
has made or had an obligation to make such contributions.
Multiple
Employer Plan means a Plan which has two or more contributing sponsors
(at least one of which is the Borrower or any member of the ERISA Group) at
least two of whom are not under common control, as such a plan is described in
Sections 4063 and 4064 of ERISA.
NJNG
Modification Agreement has the meaning given to such term in Section
8.2.18 [Amendments to NJNG Note Agreement]
NJNG Note
Agreement means the Note Agreement, dated May 15, 2008, between the
Borrower and the purchasers listed therein, as the same may have been
supplemented, amended, or modified prior to the date hereof, and as the same may
hereafter be supplemented, amended, or modified from time to time as permitted
by Section
8.2.18 [Amendments to NJNG Note Agreement].
NJNG
Notes means the unsecured Indebtedness issued by the Borrower pursuant to
the NJNG Note Agreement.
Non-Consenting
Lender has the meaning assigned to such term in Section
11.1 [Modifications, Amendments or Waivers].
Notes
means the Revolving Credit Notes and Swing Loan Note.
Notice
has the meaning assigned to such term in Section 11.6
[Notices, Lending Offices].
Obligations
means any obligation or liability of the Borrower to the Agent or any of the
Lenders, howsoever created, arising or evidenced, whether direct or indirect,
absolute or contingent, now or hereafter existing, or due or to become due,
under or in connection with this Agreement, any Notes, the Letters of Credit,
the Agent’s Letter or any other Loan Document. Obligations shall
include the liabilities to any Lender (or any Affiliate thereof) under any
Lender-Provided Interest Rate Hedge but shall not include the liabilities to
other Persons under any other Interest Rate Hedge.
Official
Body means the government of the United States of America or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central
Bank).
Order
has the meaning given to such term in Section
2.9.9 [Liability for Acts and Omissions].
Other
Taxes has the meaning given to such term in Section
5.8.2 [Stamp Taxes].
Parent
means New Jersey Resources Corporation, a corporation organized and
existing under the laws of the State of New Jersey, of which Borrower is a
wholly owned Subsidiary.
Participation
Advance means, with respect to any Lender, such Lender's payment in
respect of its participation in a Letter of Credit Borrowing according to its
Ratable Share pursuant to Section 2.9.3.4.
Partnership
Interests has the meaning given to such term in Section 6.1.2
[Subsidiaries].
PBGC
means the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any successor.
Permitted
Acquisitions has the meaning assigned to such term in Section 8.2.5
[Liquidations, Mergers, Consolidations, Acquisitions].
Permitted
Investments means:
(a) direct
obligations of the United States of America or any agency or instrumentality
thereof or obligations backed by the full faith and credit of the United States
of America maturing in twelve (12) months or less from the date of
acquisition;
(b) repurchase
agreements having a duration of not more than sixty (60) days that are
collateralized by full faith and credit obligations of the United States
Government or obligations guaranteed by the United States Government and its
agencies;
(c) interests
in investment companies registered under the Investment Company Act of 1940, as
amended (or in a separate portfolio of such an investment company), that invest
primarily in full faith and credit obligations of the United States Government
or obligations guaranteed by the United States Government and its agencies and
repurchase agreements collateralized by such obligations;
(d) time
deposits with any office located in the United States of the Lenders or any
other bank or trust company which is organized under the laws of the United
States and has combined capital, surplus and undivided profits of not less than
$500,000,000.00 or with any bank which is organized other than under the laws of
the United States (i) the commercial paper of which is rated at least A-1 by
Standard & Poor's and P-1 by Moody's (or, if such commercial paper is rated
only by Standard & Poor's, at least A-1 by Standard & Poor's, or if such
commercial paper is rated only by Moody's, at least P-1 by Moody's) or (ii) the
long term senior debt of which is rated at least AA by Standard & Poor's and
Aa2 by Moody's (or, if such debt is rated only by Standard & Poor's, at
least AA by Standard & Poor's, or if such debt is rated only by Moody's, at
least Aa2 by Moody's);
(e) commercial
paper having a maturity of not more than one year from the date of such
investment and rated at least A-1 by Standard & Poor's and P-1 by Moody's
(or, if such commercial paper is rated only by Standard & Poor's, at least
A-1 by Standard & Poor's or, if such commercial paper is rated only by
Moody's, at least P-1 by Moody's);
(f) instruments
held for collection in the ordinary course of business;
(g) any
equity or debt securities or other form of debt instrument obtained in
settlement of debts previously contracted; and
(h) any
Investment arising out of a Permitted Related Business Opportunity.
Permitted
Liens means:
(a) Liens
for taxes, assessments, or similar charges, incurred in the ordinary course of
business and which are not yet due and payable;
(b) Pledges
or deposits made in the ordinary course of business to secure payment of
workmen's compensation, or to participate in any fund in connection with
workmen's compensation, unemployment insurance, old-age pensions or other social
security programs;
(c) Liens
of mechanics, materialmen, warehousemen, carriers, or other like Liens, securing
obligations incurred in the ordinary course of business that are not yet due and
payable and Liens of landlords securing obligations to pay lease payments that
are not yet due and payable or in default;
(d) Any
Lien arising out of judgments or awards but only to the extent that the creation
of any such Lien shall not be an event or condition which, with or without
notice or lapse of time or both, would cause Borrower to be in violation of
Section 9.1.6
[Final Judgments or Orders];
(e) Security
interests in favor of lessors of personal property, which property is the
subject of a true lease;
(f) Good-faith
pledges or deposits made in the ordinary course of business to secure
performance of bids, tenders, contracts (other than for the repayment of
borrowed money) or leases, not in excess of the aggregate amount due thereunder,
or to secure statutory obligations, or surety, appeal, indemnity, performance or
other similar bonds required in the ordinary course of business;
(g) Encumbrances
consisting of zoning restrictions, easements, rights-of-way or other
restrictions on the use of real property and minor defects to title to real
property, none of which materially impairs the use of such property or the value
thereof;
(h) Liens
on property leased by the Borrower or any Subsidiary of the Borrower securing
obligations of the Borrower or such Subsidiary to the lessor under such leases,
so long as to the extent the payments or other amounts due and owing under any
such lease constitute Indebtedness, such Indebtedness is permitted under Section 8.2.1
[Indebtedness];
(i) Any
Lien existing on the date of this Agreement and described on Schedule
1.1(P),
provided, that, to the extent
any such Lien secures Indebtedness permitted by Section 8.2.1(b),
such Lien may continue to secure any renewals or extensions of such Indebtedness
permitted by Section 8.2.1(b)
so long as (i) the principal amount of the Indebtedness secured by any such Lien
is not hereafter increased and (ii) no additional assets become subject to such
Lien;
(j) Liens
on assets of the Borrower existing on the Closing Date (other than on any
"Excepted Property" of the Borrower, as "Excepted Property" is defined in the
Mortgage Indenture on the Closing Date), which Liens secure outstanding
Indebtedness as of the Closing Date under the Mortgage Indenture and thereafter
Liens on assets of the Borrower (other than on any "Excepted Property") which
additional Liens secure outstanding Indebtedness as of the Closing Date under
the Mortgage Indenture and any additional Indebtedness which is issued in
accordance with Article Two of the Mortgage Indenture and is otherwise permitted
by Section
8.2.1(c);
(k) Purchase
Money Security Interests, provided, that the
aggregate amount of loans and deferred payments secured by such Purchase Money
Security Interests shall not exceed $20,000,000.00 (excluding for the purpose of
this computation any loans or deferred payments secured by Liens described on
Schedule
1.1(P));
(l) Liens
on any property or asset of an Acquired Person so long as: (i) such
Liens secure Indebtedness of the Acquired Person and such Indebtedness and such
Liens on property or assets of the Acquired Person existed prior to the
consummation of the Permitted Acquisition and were not created in contemplation
of or in connection with such acquisition, (ii) such Liens apply solely to the
assets of the Acquired Person and do not apply to any asset of the Borrower or
any Subsidiary of the Borrower, and (iii) after giving effect to such Permitted
Acquisition and all other Permitted Acquisitions made by the Borrower and any
Subsidiary of the Borrower from and after the Closing Date, the aggregate
outstanding amount of all Indebtedness secured by Liens permitted by this clause
(l) shall not exceed $75,000,000.00; and
(m) The
following, (i) if the validity or amount thereof is being contested in good
faith by appropriate and lawful proceedings diligently conducted so long as levy
and execution thereon have been stayed and continue to be stayed or (ii) if
a final judgment is entered and such judgment is discharged within thirty (30)
days of entry, and could not be reasonably expected to result in a Material
Adverse Change:
(A) Claims
or Liens for taxes, assessments or charges due and payable and subject to
interest or penalty, provided that the Borrower or
any of its Subsidiaries, as applicable, maintains such reserves or other
appropriate provisions as shall be required by GAAP and pays all such taxes,
assessments or charges forthwith upon the commencement of proceedings to
foreclose any such Lien;
(B) Claims,
Liens or encumbrances upon, and defects of title to, real or personal property,
including any attachment of personal or real property or other legal process
prior to adjudication of a dispute on the merits; or
(C) Claims
or Liens of mechanics, materialmen, warehousemen, carriers, or other statutory
nonconsensual Liens.
Permitted
Related Business Opportunity means any transaction with another Person
(other than any Inactive Subsidiary of Parent) involving business activities or
assets reasonably related or complementary to the business of the Borrower and
its Subsidiaries as conducted on the Closing Date or as may be conducted
pursuant to Section
8.2.9 [Continuation of or Change in Business], including, without
limitation, the management and marketing of storage, capacity and transportation
of gas and other forms of energy, the generation, transmission or storage of gas
and other forms of energy, or the access to gas and energy transmission lines,
and business initiatives for the conservation and efficiency of gas and
energy.
Permitted
Sale and Leaseback Program means the sale and leaseback of gas meters by
the Borrower, consistent with its existing sale and leaseback program, in an
aggregate amount in each fiscal year not to exceed $12,000,000.00.
Permitted
Transferee means, as of any date of determination, any of the following
with respect to any then current officer or director of the
Parent: (a) such Person's spouse, lineal descendants or lineal
descendant's of such Person's spouse, (b) any charitable corporation or trust
established by such officer or director or by any Person described in the
immediately preceding clause (a), (c) any trust (or in the case of a minor, a
custodial account under a Uniform Gifts or Transfers to Minors Act) of which the
beneficiary or beneficiaries are one or more Persons described in the
immediately preceding clauses (a) or (b), or (d) any executor or administrator
upon the death of such officer or director or the death of any Person described
in the immediately preceding clauses (a) or (b).
Person
means any individual, corporation, partnership, limited liability company,
association, joint-stock company, trust, unincorporated organization, joint
venture, government or political subdivision or agency thereof, or any other
entity.
Plan
means an "employee pension benefit plan," within the meaning of Section (3)(2)
of ERISA (not including a Multiple Employer Plan or a Multiemployer Plan), which
is covered by Title IV of ERISA or is subject to the minimum funding standards
under Section 412 of the Internal Revenue Code and either (a) is
maintained by any member of the ERISA Group for employees of any member of the
ERISA Group or (b) solely for purposes of Section 6.1.19, has at any
time within the preceding five years been maintained by any entity which was at
such time a member of the ERISA Group for employees of any entity which was at
such time a member of the ERISA Group.
PNC
Bank means PNC Bank, National Association, its successors and
assigns.
Potential
Default means any event or condition which with notice, passage of time,
or both, would constitute an Event of Default.
Principal
Office means the main banking office of the Agent in Pittsburgh,
Pennsylvania.
Prohibited
Transaction means any prohibited transaction as defined in
Section 4975 of the Internal Revenue Code or Section 406 of ERISA for
which neither an individual nor a class exemption has been issued by the United
States Department of Labor.
Property
means all real property, both owned and leased, of the Borrower or any
Subsidiary of the Borrower.
Published
Rate means the rate of interest published each Business Day in The Wall
Street Journal "Money Rates" listing under the caption "London Interbank Offered
Rates" for a one month period (or, if no such rate is published therein for any
reason, then the Published Rate shall be the eurodollar rate for a one month
period as published in another publication selected by the Agent).
Purchase
Money Security Interest means Liens upon tangible personal property
securing loans to the Borrower or any Subsidiary of the Borrower or deferred
payments by the Borrower or such Subsidiary for the purchase of such tangible
personal property.
Purchasing
Lender means a Lender which becomes a party to this Agreement by
executing an Assignment and Assumption Agreement.
Ratable
Share means with respect to a Lender's obligation to make Loans,
participate in Swing Loans and Letters of Credit and other Reimbursement
Obligations and Letter of Credit Borrowings, and receive payments, interest, and
fees related thereto, the proportion that such Lender's Commitment (excluding
its Swing Loan Commitment) bears to the Commitments of all of the Lenders
(excluding the Swing Loan Commitment), provided however that if the
Commitments have terminated or expired, the Ratable Shares for purposes of this
clause shall be determined based upon the Commitments most recently in effect,
giving effect to any assignments.
Regulated
Entity means any Person which is subject under Law to any of the laws,
rules or regulations respecting the financial, organizational or rate regulation
of electric companies, public utilities, or public utility holding
companies.
Regulated
Substances means, without limitation, any substance, material or waste,
regardless of its form or nature, defined under Environmental Laws as a
"hazardous substance," "pollutant," "pollution," "contaminant," "hazardous or
toxic substance," "extremely hazardous substance," "toxic chemical," "toxic
substance," "toxic waste," "hazardous waste," "special handling waste,"
"industrial waste," "residual waste," "solid waste," "municipal waste," "mixed
waste," "infectious waste," "chemotherapeutic waste," "medical waste," or
"regulated substance", or any other substance, material or waste, regardless of
its form or nature, which is regulated, controlled or governed by Environmental
Laws due to its radioactive, ignitable, corrosive, reactive, explosive, toxic,
carcinogenic or infectious properties or nature or any other material, substance
or waste, regardless of its form or nature, which otherwise is regulated,
controlled or governed by Environmental Laws, including without limitation,
petroleum and petroleum products (including crude oil and any fractions
thereof), natural gas, synthetic gas and any mixtures thereof, asbestos, urea
formaldehyde, polychlorinated biphenlys, mercury, radon and radioactive
materials.
Regulations
has the meaning given to such term in Section
11.18.1 [Tax Withholding].
Regulation
U means Regulations U, T, G, or X as promulgated by the Board of
Governors of the Federal Reserve System, as amended from time to
time.
Reimbursement
Obligation has the meaning assigned to such term in Section 2.9.3.2.
Related
Parties has the meaning given to such term in Section
10.14 [Resignation of the Agent].
Remedial
Action means any investigation, identification, characterization,
delineation, cleanup, removal, remediation, containment, control or abatement of
or other response actions to Regulated Substances and any closure or
post-closure measures associated therewith.
Reportable
Event means a reportable event described in Section 4043 of ERISA
and regulations thereunder with respect to a Plan, Multiple Employer Plan which
is covered under Title IV of ERISA or subject to the minimum funding standards
under Section 412 or 430 of the Internal Revenue Code, or Multiemployer
Plan.
Required
Lenders means, at any time, Lenders whose Ratable Shares equal or exceed
51% as determined pursuant to the definition of "Ratable
Share." Reimbursement Obligations and Letter of Credit Borrowings
shall be deemed, for purposes of this definition, to be in favor of the Agent
and not a participating Lender if such Lender has not made its Participation
Advance in respect thereof and shall be deemed to be in favor of such Lender to
the extent of its Participation Advance if it has made its Participation Advance
in respect thereof.
Required
Share has the meaning assigned to such term in Section 5.10.
Revolving
Credit Commitment means, as to any Lender at any time, the amount
initially set forth opposite its name on Schedule
1.1(B)
in the column labeled "Amount of Commitment for Revolving Credit Loans," and
thereafter as determined by the Agent after giving effect to each applicable
Lender Joinder and Assignment and Assumption Agreement executed by such Lender
and delivered to the Agent, and Revolving
Credit Commitments means the aggregate Revolving Credit Commitments of
all of the Lenders.
Revolving
Credit Loans means collectively and Revolving
Credit Loan means separately all Revolving Credit Loans or any Revolving
Credit Loan made by the Lenders or one of the Lenders to the Borrower pursuant
to Section 2.1.1
[Revolving Credit Loans] or Section
2.9.3
[Disbursements, Reimbursements].
Revolving
Credit Note means any Revolving Credit Note of the Borrower in the
form of Exhibit 1.1(R)
issued by the Borrower at the request of a Lender pursuant to Section 5.9
[Notes] evidencing the Revolving Credit Loans to such Lender, together with all
amendments, extensions, renewals, replacements, refinancings or refundings
thereof in whole or in part.
Revolving
Facility Usage means at any time the sum of the Revolving Credit Loans
outstanding, the Swing Loans outstanding and the Letters of Credit
Outstanding.
SEC
means the Securities and Exchange Commission or any governmental agencies
substituted therefor.
SEC
Filings means the Parent's Form 10-K, filed with the SEC for the
fiscal year ended September 30, 2009.
Section 20
Subsidiary means the Subsidiary of the bank holding company controlling
any Lender, which Subsidiary has been granted authority by the Federal Reserve
Board to underwrite and deal in certain Ineligible Securities.
Settlement
Date has the meaning given to such term in Section
2.5 [Swing Loan Requests].
Solvent
means, with respect to any Person on a particular date, that on such date (a)
such Person is able to realize upon its assets and pay its debts and other
liabilities as they mature in the normal course of business, and (b) such
Person has not incurred debts or liabilities beyond such Person's ability to pay
as such debts and liabilities mature.
Standard
& Poor's means Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc., and its successors.
Standby
Letter of Credit means a Letter of Credit issued to support obligations
of the Borrower, contingent or otherwise, which finances the working capital and
business needs of the Borrower incurred in the ordinary course of its business,
but excluding any Letter of Credit under which the stated amount of such Letter
of Credit increases automatically over time and excluding Commercial Letters of
Credit.
Subsidiary
of any Person at any time means (a) any corporation or trust of which 50%
or more (by number of shares or number of votes) of the outstanding capital
stock or shares of beneficial interest normally entitled to vote for the
election of one or more directors or trustees (regardless of any contingency
which does or may suspend or dilute the voting rights) is at such time owned
directly or indirectly by such Person or one or more of such Person's
Subsidiaries, (b) any partnership of which such Person is a general partner
or of which 50% or more of the partnership interests is at the time directly or
indirectly owned by such Person or one or more of such Person's Subsidiaries,
(c) any limited liability company of which such Person is a member or of
which 50% or more of the limited liability company interests is at the time
directly or indirectly owned by such Person or one or more of such Person's
Subsidiaries or (d) any corporation, trust, partnership, limited liability
company or other entity which is controlled or capable of being controlled by
such Person or one or more of such Person's Subsidiaries.
Subsidiary
Shares has the meaning assigned to such term in Section 6.1.2
[Subsidiaries].
Swing
Loan Commitment means PNC Bank's commitment to make Swing Loans to the
Borrower pursuant to Section 2.1.2
[Swing Loan Commitment] hereof in an aggregate principal amount up to
$20,000,000.00.
Swing
Loan Interest Rate means as to each Swing Loan the rate of interest
quoted by PNC Bank applicable thereto and accepted by the Borrower with respect
to such Swing Loan.
Swing
Loan Note means the Swing Loan Note of the Borrower in the form of Exhibit 1.1(S)
evidencing the Swing Loans, together with all amendments, extensions, renewals,
replacements, refinancings or refundings thereof in whole or in
part.
Swing
Loan Request means a request for Swing Loans made in accordance with
Section 2.5
[Swing Loan Requests] hereof.
Swing
Loans means collectively and Swing
Loan means separately all Swing Loans or any Swing Loan made by PNC Bank
to the Borrower pursuant to Section 2.1.2
[Swing Loan Commitment] hereof.
Taxes
has the meaning given to such term in Section
5.8.1 [No Deductions].
Transferor
Lender means the selling Lender pursuant to an Assignment and Assumption
Agreement.
USA
Patriot Act means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107-56, as the same has been, or shall hereafter be, renewed,
extended, amended or replaced.
Website
Posting has the meaning given to such term in Section
11.6 [Notices; Lending Offices].
1.2 Construction.
Unless
the context of this Agreement otherwise clearly requires, the following rules of
construction shall apply to this Agreement and each of the other Loan
Documents:
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1.2.1.
|
Number;
Inclusion.
|
References
to the plural include the singular, the plural, the part and the whole; "or" has
the inclusive meaning represented by the phrase "and/or" and "including" has the
meaning represented by the phrase "including without limitation".
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1.2.2.
|
Determination.
|
References
to "determination" of or by the Agent or the Lenders shall be deemed to include
good-faith estimates by the Agent or the Lenders (in the case of quantitative
determinations) and good-faith beliefs by the Agent or the Lenders (in the case
of qualitative determinations) and such determination shall be conclusive absent
manifest error.
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1.2.3.
|
Agent's Discretion and
Consent.
|
Whenever
the Agent or the Lenders are granted the right herein to act in its or their
sole discretion or to grant or withhold consent such right shall be exercised in
good faith.
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1.2.4.
|
Documents Taken as a
Whole.
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The words
"hereof," "herein," "hereunder," "hereto" and similar terms in this Agreement or
any other Loan Document refer to this Agreement or such other Loan Document as a
whole and not to any particular provision of this Agreement or such other Loan
Document.
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1.2.5.
|
Headings.
|
The
section and other headings contained in this Agreement or such other Loan
Document and the Table of Contents (if any), preceding this Agreement or such
other Loan Document are for reference purposes only and shall not control or
affect the construction of this Agreement or such other Loan Document or the
interpretation thereof in any respect.
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1.2.6.
|
Implied References to
this Agreement.
|
Article,
section, subsection, clause, schedule and exhibit references are to this
Agreement or other Loan Document, as the case may be, unless otherwise
specified.
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1.2.7.
|
Persons.
|
Reference
to any Person includes such Person's successors and assigns but, if applicable,
only if such successors and assigns are permitted by this Agreement or such
other Loan Document, as the case may be, and reference to a Person in a
particular capacity excludes such Person in any other capacity.
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1.2.8.
|
Modifications to
Documents.
|
Reference
to any agreement (including this Agreement and any other Loan Document together
with the schedules and exhibits hereto or thereto), document or instrument means
such agreement, document or instrument as amended, modified, replaced,
substituted for, superseded or restated.
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1.2.9.
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From, To and
Through.
|
Relative
to the determination of any period of time, "from" means "from and including,"
"to" means "to but excluding," and "through" means "through and
including".
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1.2.10.
|
Shall;
Will.
|
References
to "shall" and "will" are intended to have the same meaning.
1.3 Accounting
Principles.
Except as
otherwise provided in this Agreement, all computations and determinations as to
accounting or financial matters and all financial statements to be delivered
pursuant to this Agreement shall be made and prepared in accordance with GAAP
(including principles of consolidation where appropriate), and all accounting or
financial terms shall have the meanings ascribed to such terms by GAAP; provided, however, that all
accounting terms used in Section 8.2
[Negative Covenants] (and all defined terms used in the definition of any
accounting term used in Section 8.2)
have the meaning given to such terms (and defined terms) under GAAP as in effect
on the date hereof applied on a basis consistent with those used in preparing
the Annual Statements referred to in Section 6.1.8(a)
[Historical Statements]. In the event of any change after the date
hereof in GAAP, and if such change would affect the computation of any of the
financial covenants set forth in Section 8.2
based upon the Borrower's regularly prepared financial statements by reason of
the preceding sentence, then the parties hereto agree to endeavor, in good
faith, to agree upon an amendment to this Agreement that would adjust such
financial covenants in a manner that would not affect the substance thereof, but
would allow compliance therewith to be determined in accordance with the
Borrower's financial statements at that time, provided that, until
so amended, such financial covenants shall continue to be computed in accordance
with GAAP prior to such change therein.
2. REVOLVING CREDIT
AND SWING LOAN
FACILITIES
2.1 Commitments.
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2.1.1.
|
Revolving Credit
Loans.
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Subject
to the terms and conditions hereof and relying upon the representations and
warranties herein set forth, each Lender severally agrees to make Revolving
Credit Loans to the Borrower in Dollars at any time or from time to time on or
after the date hereof to, but not including, the Expiration Date, provided that, after
giving effect to each such Revolving Credit Loan the aggregate amount of
Revolving Credit Loans from such Lender shall not exceed such Lender's Revolving
Credit Commitment minus such Lender's Ratable Share of the amount of (a) Letters
of Credit Outstanding and (b) outstanding Swing Loans; and provided further that
the Revolving Facility Usage at any time shall not exceed the Revolving Credit
Commitments of all the Lenders. Within such limits of time and amount
and subject to the other provisions of this Agreement, the Borrower may borrow,
repay and reborrow pursuant to this Section 2.1.1. The
outstanding principal amount of all Revolving Credit Loans, together with
accrued interest thereon, shall be due and payable on the Expiration
Date.
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2.1.2.
|
Swing Loan
Commitment.
|
Subject
to the terms and conditions hereof and relying upon the representations and
warranties herein set forth, PNC Bank may at its discretion make Swing Loans to
the Borrower in Dollars at the Borrower's request as hereinafter provided, from
time to time after the date hereof to, but not including, the Expiration Date,
in an aggregate principal amount of up to but not in excess of the Swing Loan
Commitment, provided that the
Revolving Facility Usage at any time (after giving effect to any requested Swing
Loan) shall not exceed the Revolving Credit Commitments of all the
Lenders. Within such limits of time and amount and subject to the
other provisions of this Agreement, the Borrower may borrow, repay and reborrow
pursuant to this Section 2.1.2. The
outstanding principal amount of all Swing Loans, together with accrued interest
thereon, shall be due and payable on the earlier of the Settlement Date
applicable thereto or the Expiration Date.
2.2 Nature of Lenders'
Obligations with Respect to Revolving Credit Loans.
Each
Lender shall be obligated to participate in each request for Revolving Credit
Loans pursuant to Section
2.4 [Revolving Credit Loan Requests] in accordance with its Ratable
Share. The aggregate amount of each Lender's Revolving Credit Loans
outstanding hereunder to the Borrower at any time shall never exceed its
Revolving Credit Commitment minus its Ratable Share of the amount of Letters of
Credit Outstanding and outstanding Swing Loans. The obligations of
each Lender hereunder are several. The failure of any Lender to
perform its obligations hereunder shall not affect the Obligations of the
Borrower to any other party nor shall any other party be liable for the failure
of such Lender to perform its obligations hereunder. The Lenders
shall have no obligation to make Revolving Credit Loans hereunder on or after
the Expiration Date.
2.3 Commitment
Fee.
Accruing
from the date hereof until the Expiration Date, the Borrower agrees to pay to
the Agent in Dollars for the account of each Lender, as consideration for such
Lender's Revolving Credit Commitment hereunder, a nonrefundable commitment fee
(the "Commitment
Fee"), calculated on a per annum (365 or 366 days, as appropriate, and
actual days elapsed) basis at the Applicable Commitment Fee Rate from time to
time on the average daily difference between the
amount of (a) such Lender's Revolving Credit Commitment as
the same may be constituted from time to time and (b) the principal amount of
such Lender's Ratable Share of Revolving Facility Usage, in each case, as
determined for the immediately preceding fiscal quarter (or shorter
period commencing with the Closing Date or ending with the Expiration Date);
provided, however, that any
Commitment Fee accrued with respect to the Revolving Credit Commitment of a
Defaulting Lender during the period prior to the time such Lender became a
Defaulting Lender and unpaid at such time shall not be payable by the Borrower
so long as such Lender is a Defaulting Lender except to the extent that such
Commitment Fee shall otherwise have been due and payable by the Borrower prior
to such time; and provided further that no
Commitment Fee shall accrue on the Revolving Credit Commitment of a Defaulting
Lender so long as such Lender is a Defaulting Lender. All Commitment Fees shall
be payable quarterly in arrears on the first day of each January, April, July
and October for the immediately preceding quarter, the date of each reduction of
the Revolving Credit Commitments, and on the Expiration Date or upon
acceleration of the Notes. For purposes of this computation, PNC Bank's
outstanding Swing Loans shall be deemed to be borrowed amounts under its
Revolving Credit Commitment.
2.4 Revolving Credit Loan
Requests.
Except as
otherwise provided herein, the Borrower may from time to time prior to the
Expiration Date request the Lenders to make Revolving Credit Loans or renew or
convert the Interest Rate Option applicable to existing Revolving Credit Loans
pursuant to Section 4.2
[Interest Periods], by delivering to the Agent, not later than 10:00 a.m.,
Pittsburgh time, (a) three (3) Business Days prior to the proposed
Borrowing Date with respect to the making of Revolving Credit Loans to which the
Euro-Rate Option applies or the date of conversion to or the renewal of the
Euro-Rate Option for any such Loans; and (b) on either the proposed
Borrowing Date with respect to the making of a Revolving Credit Loan to which
the Base Rate Option applies or the last day of the preceding Interest Period
with respect to the conversion to the Base Rate Option for any Loan, of a Loan
Request therefor duly completed by an Authorized Officer substantially in the
form of Exhibit 2.4
or a Loan Request by telephone immediately confirmed in writing by letter,
facsimile or telex in the form of such Exhibit, it being understood that the
Agent may rely on the authority of any individual making such a telephonic
request without the necessity of receipt of such written confirmation, provided
that such individual purports to be an Authorized Officer. Each Loan
Request shall be irrevocable and shall specify (i) the proposed Borrowing
Date; (ii) the aggregate amount of the proposed Revolving Credit Loans
comprising each Borrowing Tranche, the amount of which shall be in integral
multiples of $1,000,000.00 and not less than $3,000,000.00 for each Borrowing
Tranche to which the Euro-Rate Option applies and not less than the lesser of
$1,000,000.00 and in integral multiples of $100,000.00 or the maximum amount
available for Borrowing Tranches to which the Base Rate Option applies;
(iii) whether the Euro-Rate Option or Base Rate Option shall apply to the
proposed Loans comprising the applicable Borrowing Tranche; and (iv) in the
case of a Borrowing Tranche to which the Euro-Rate Option applies, an
appropriate Interest Period for the Loans comprising such Borrowing
Tranche.
2.5 Swing Loan
Requests.
Except as
otherwise provided herein, the Borrower may from time to time prior to the
Expiration Date request PNC Bank to make a Swing Loan by delivery to PNC Bank,
not later than 12:00 noon Pittsburgh time, on the proposed Borrowing Date of a
request therefor duly completed by an Authorized Officer substantially in the
form of Exhibit 2.5.
hereto or a request by telephone immediately confirmed in writing by letter,
facsimile or telex, it being understood that PNC Bank may rely on the authority
of any individual making such a telephonic request without the necessity of
receipt of such written confirmation, provided that such individual purports to
be an Authorized Officer. Each Swing Loan Request shall be
irrevocable and shall specify (a) the proposed Borrowing Date, (b) the
date such Swing Loan is to be repaid, if applicable (such date,
together with any earlier date on which PNC Bank makes demand for repayment
thereof, the "Settlement
Date"), and (c) the principal amount of such Swing Loan, which shall
not be less than $250,000.00 and shall be an integral multiple of $100,000.00.
Each Swing Loan shall be payable on demand, and, if no demand is made therefor,
on the applicable Settlement Date.
2.6 Making Revolving Credit
Loans and Swing
Loans.
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2.6.1.
|
Making Revolving
Credit Loans.
|
Promptly
after receipt by the Agent of a Loan Request for or with respect to Revolving
Credit Loans pursuant to Section 2.4
[Revolving Credit Loan Requests], the Agent shall notify the Lenders with
Revolving Credit Commitments of its receipt of such Loan Request specifying:
(a) the proposed Borrowing Date and the time and method of disbursement of
the Revolving Credit Loans requested thereby; (b) the amount and type of
each such Revolving Credit Loan and the applicable Interest Period (if any); and
(c) the apportionment among the Lenders of such Revolving Credit Loans as
determined by the Agent in accordance with Section 2.2
[Nature of Lenders' Obligations]. Each Lender shall remit the
principal amount of each Revolving Credit Loan to the Agent such that the Agent
is able to, and the Agent shall, to the extent the Lenders have made funds
available to it for such purpose and subject to Section 7.2
[Each Additional Loan or Letter of Credit], fund such Revolving Credit Loans to
the Borrower in U.S. Dollars and immediately available funds at the Principal
Office prior to 2:00 p.m., Pittsburgh time, on the applicable Borrowing Date,
provided that if any Lender
fails to remit such funds to the Agent in a timely manner, the Agent may elect
in its sole discretion to fund with its own funds the Revolving Credit Loans of
such Lender on such Borrowing Date, and such Lender shall be subject to the
repayment obligation in Section 10.16
[Availability of Funds].
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2.6.2.
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Making Swing
Loans.
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So long
as PNC Bank elects to make Swing Loans, after receipt by it of a Swing Loan
Request pursuant to Section 2.5
[Swing Loan Requests], PNC Bank shall fund such Swing Loan to the Borrower in
U.S. Dollars and immediately available funds at the Principal Office prior to
2:00 p.m. Pittsburgh time on the Borrowing Date. Each Swing Loan
shall bear interest at the Swing Loan Interest Rate applicable thereto for the
account of PNC Bank only.
2.7 Swing Loan
Note.
The
obligation of the Borrower to repay the unpaid principal amount of the Swing
Loans made to it by PNC Bank together with interest thereon shall be evidenced
by a demand promissory note of the Borrower dated the Closing Date in
substantially the form attached hereto as Exhibit 1.1(S)
payable to the order of PNC Bank in a face amount equal to the Swing Loan
Commitment.
2.8 Use of
Proceeds.
The
proceeds of the Loans shall be used by the Borrower for general corporate
purposes of the Borrower, including without limitation, to support the issuance
by the Borrower of short term notes in the commercial paper market, and in
accordance with Section 8.1.10
[Use of Proceeds].
2.9 Letter of Credit
Subfacility.
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2.9.1.
|
Issuance of Letters of
Credit.
|
The
Borrower may request the issuance of a letter of credit (each a "Letter of
Credit") on behalf of itself by delivering to the Agent an application
and agreement for letters of credit in such form as the Agent may specify, duly
completed by an Authorized Officer from time to time by no later than 10:00
a.m., Pittsburgh time, at least five (5) Business Days, or such shorter period
as may be agreed to by the Agent, in advance of the proposed date of
issuance. Each Letter of Credit shall be a Standby Letter of Credit
(and may not be a Commercial Letter of Credit) and shall be denominated in
Dollars. Subject to the terms and conditions hereof and in reliance
on the agreements of the other Lenders set forth in this Section 2.9,
the Agent or any of the Agent's Affiliates will issue a Letter of Credit provided that each Letter of
Credit shall (a) have a maximum maturity of twelve (12) months from the
date of issuance, and (b) in no event expire later than ten (10) Business
Days prior to the Expiration Date; provided, further, that in no event
shall the Revolving Facility Usage, after giving effect to such Letter of
Credit, exceed, at any one time, the Revolving Credit Commitments; and provided, further, that at no time shall
Letters of Credit Outstanding (after giving effect to all Letters of Credit
being requested) exceed the Letter of Credit Sublimit. Schedule
2.9.1 sets forth letters of credit issued by PNC Bank, National
Association, as administrative agent, under the Existing Agreement, which are
outstanding as of the Closing
Date (the "Existing
Letters of Credit"). It is expressly agreed that the Existing
Letters of Credit are Letters of Credit under this Agreement. Notwithstanding
any other provision hereof, no Issuing Lender hereunder shall be required to
issue any Letter of Credit, if any Lender is at such time a Defaulting Lender
hereunder, unless such Issuing Lender has entered into satisfactory arrangements
with the Borrower or such Defaulting Lender (including without limitation the
provision of cash collateral) to eliminate the Issuing Lender's risk with
respect to such Defaulting Lender. The Borrower shall not be entitled to the
issuance, amendment or extension of any Letter of Credit if at such time the
conditions set forth in Section
7.2 [Each Additional Loan or Letter of Credit] are not
satisfied.
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2.9.2.
|
Letter of Credit
Fees.
|
The
Borrower shall pay (a) to the Agent for the ratable account of the Lenders
a fee (the "Letter of
Credit Fee") equal to the Applicable Letter of Credit Fee Rate then in
effect (computed on the basis of a year of 360 days and actual days elapsed) per
annum, and (b) to the Agent for the account of the Issuing Lender a
fronting fee equal to 0.25% per annum (computed on the basis of a year of 360
days and actual days elapsed), which fees shall be computed on the daily average
amount of Letters of Credit Outstanding and shall be payable quarterly in
arrears commencing with the first Business Day of each January, April, July and
October following issuance of each Letter of Credit and on the Expiration
Date. The Borrower shall also pay to the Agent for the Issuing
Lender's sole account customary fees and administrative expenses then in effect
payable with respect to the Letters of Credit as the Issuing Lender may
generally charge or incur from time to time in connection with the issuance,
maintenance, modification (if any), assignment or transfer (if any), negotiation, and
administration of Letters of Credit.
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2.9.3.
|
Disbursements,
Reimbursement.
|
2.9.3.1 Immediately
upon the issuance of each Letter of Credit, each Lender shall be deemed to, and
hereby irrevocably and unconditionally agrees to, purchase from the Agent a
participation in such Letter of Credit and each drawing thereunder in an amount
equal to such Lender's Ratable Share of the maximum amount available to be drawn
under such Letter of Credit and the amount of such drawing,
respectively.
2.9.3.2 In the
event of any request for a drawing under a Letter of Credit by the beneficiary
or transferee thereof, the Agent will promptly notify the
Borrower. Provided that it shall have received such notice, the
Borrower shall reimburse (such obligation to reimburse the Agent shall sometimes
be referred to as a "Reimbursement Obligation") the
Agent prior to 12:00 noon, Pittsburgh time on each date that an amount is paid
by the Agent under any Letter of Credit, or if paid after 12:00 noon, Pittsburgh
time, on the immediately following Business Day (each such date on which the
Borrower is obligated to make such payment, a "Drawing Date") in an amount
equal to the amount so paid by the Agent plus interest at the Base Rate Option
for each day, if any, from the date a draw is made under a Letter of Credit
through the Drawing Date. In the event the Borrower fails to
reimburse the Agent for the full amount of any drawing under any Letter of
Credit by 12:00 noon, Pittsburgh time, on the Drawing Date, the Agent will
promptly notify each Lender thereof, and the Borrower shall be deemed to have
requested that Revolving Credit Loans be made by the Lenders under the Base Rate
Option to be disbursed on the Drawing Date under such Letter of Credit, subject
to the amount of the unutilized portion of the Revolving Credit Commitment and
subject to the conditions set forth in Section 7.2 [Each Additional Loan]
other than any notice requirements. Any notice given by the Agent
pursuant to this Section 2.9.3.2 may be oral if
immediately confirmed in writing; provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.
2.9.3.3 Each
Lender shall upon any notice pursuant to Section 2.9.3.2 make available to the
Agent an amount in immediately available funds equal to its Ratable Share of the
amount of the drawing, whereupon the participating Lenders shall (subject to
Section 2.9.3.4) each be deemed to
have made a Revolving Credit Loan under the Base Rate Option to the Borrower in
that amount. If any Lender so notified fails to make available to the
Agent for the account of the Agent the amount of such Lender's Ratable Share of
such amount by no later than 2:00 p.m., Pittsburgh time on the Drawing Date,
then interest shall accrue on such Lender's obligation to make such payment,
from the Drawing Date to the date on which such Lender makes such payment (a) at
a rate per annum equal to the Federal Funds Effective Rate during the first
three (3) days following the Drawing Date and (b) at a rate per annum equal to
the rate applicable to Loans under the Base Rate Option on and after the fourth
(4th) day following the Drawing Date. The Agent will promptly give
notice of the occurrence of the Drawing Date, but failure of the Agent to give
any such notice on the Drawing Date or in sufficient time to enable any Lender
to effect such payment on such date shall not relieve such Lender from its
obligation under this Section 2.9.3.3, provided, however,
interest shall not accrue on any Lender's obligation to make a payment under
this Section 2.9.3.3,
until such Lender has received notice of the Drawing Date from the
Agent.
2.9.3.4 With
respect to any unreimbursed drawing that is not converted into Revolving Credit
Loans under the Base Rate Option to the Borrower in whole or in part as
contemplated by Section 2.9.3.2, because of the
Borrower's failure to satisfy the conditions set forth in Section 7.2 [Each Additional Loan]
other than any notice requirements or for any other reason, the Borrower shall
be deemed to have incurred from the Agent a borrowing (each a "Letter of Credit Borrowing")
in the amount of such drawing. Such Letter of Credit Borrowing shall
be due and payable on demand (together with interest) and shall bear interest at
the rate per annum applicable to the Revolving Credit Loans under the Base Rate
Option. Each Lender's payment to the Agent pursuant to Section 2.9.3.3 shall be deemed to be
a payment in respect of its participation in such Letter of Credit Borrowing (to
the extent this Section in applicable) and shall constitute a "Participation Advance" from
such Lender in satisfaction of its participation obligation under this Section 2.9.3.
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2.9.4.
|
Repayment of
Participation Advances.
|
2.9.4.1 Upon (and
only upon) receipt by the Agent for its account of immediately available funds
from the Borrower (a) in reimbursement of any payment made by the Agent
under the Letter of Credit with respect to which any Lender has made a
Participation Advance to the Agent, or (b) in payment of interest on such a
payment made by the Agent under such a Letter of Credit, the Agent will pay to
each Lender, in the same funds as those received by the Agent, the amount of
such Lender's Ratable Share of such funds, except the Agent shall retain the
amount of the Ratable Share of such funds of any Lender that did not make a
Participation Advance in respect of such payment by Agent.
2.9.4.2 If the
Agent is required at any time to return to the Borrower, or to a trustee,
receiver, liquidator, custodian, or any official in any Insolvency Proceeding,
any portion of the payments made by the Borrower to the Agent pursuant to Section 2.9.4.1 in reimbursement of a
payment made under the Letter of Credit or interest or fee thereon, on demand of
the Agent each Lender shall forthwith return to the Agent the amount of its
Ratable Share of any amounts so returned by the Agent plus interest thereon from
the date such demand is made to the date such amounts are returned by such
Lender to the Agent, at a rate per annum equal to the Federal Funds Effective
Rate in effect from time to time.
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2.9.5.
|
Documentation.
|
The
Borrower agrees to be bound by the terms of the Agent's application and
agreement for letters of credit and the Agent's written regulations and
customary practices relating to letters of credit, though such interpretation
may be different from the Borrower's own. In the event of a conflict
between such application or agreement and this Agreement, this Agreement shall
govern. It is understood and agreed that, except in the case of gross
negligence or willful misconduct, the Agent shall not be liable for any error
and/or mistakes, whether of omission or commission, in following the Borrower's
written instructions or those contained in the Letters of Credit or any
modifications, amendments or supplements thereto, provided that the Borrower
agrees that all instructions provided to the Agent by the Borrower with respect
to any Letter of Credit shall be provided in writing.
|
2.9.6.
|
Determinations to
Honor Drawing Requests.
|
In
determining whether to honor any request for drawing under any Letter of Credit
by the beneficiary thereof, the Agent shall be responsible only to determine
that the documents and certificates required to be delivered under such Letter
of Credit have been delivered and that they comply on their face with the
requirements of such Letter of Credit.
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2.9.7.
|
Nature of
Participation and Reimbursement Obligations.
|
Each
Lender's obligation in accordance with this Agreement to make the Revolving
Credit Loans or Participation Advances, as contemplated by Section 2.9.3
[Disbursements, Reimbursements], as a result of a drawing under a Letter of
Credit, and the Obligations of the Borrower to reimburse the Agent upon a draw
under a Letter of Credit, shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the terms of this Section 2.9
under all circumstances, including the following circumstances:
(a) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against the Agent or any of its Affiliates, the Borrower or any other
Person for any reason whatsoever;
(b) the
failure of the Borrower or any other Person to comply, in connection with a
Letter of Credit Borrowing, with the conditions applicable to Revolving Credit
Loans set forth in Sections 2.1.1
[Revolving Credit Loans], 2.4
[Revolving Credit Loan Requests], 2.6
[Making Revolving Credit Loans and Swing Loans] or 7.2
[Each Additional Loan or Letter of Credit] or as otherwise set forth in this
Agreement for the making of a Revolving Credit Loan, it being acknowledged that
such conditions are not required for the making of a Letter of Credit Borrowing
and the obligation of the Lenders to make Participation Advances under Section 2.9.3;
(c) any
lack of validity or enforceability of any Letter of Credit;
(d) any
claim of breach of warranty that might be made by the Borrower or any Lender
against any beneficiary of a Letter of Credit, or the existence of any claim,
set-off, recoupment, counterclaim, crossclaim, defense or other right which the
Borrower or any Lender may have at any time against a beneficiary, successor
beneficiary any transferee or assignee of any Letter of Credit or the proceeds
thereof (or any Persons for whom any such transferee may be acting), the Agent
or its Affiliates or any Lender or any other Person or, whether in connection
with this Agreement, the transactions contemplated herein or any unrelated
transaction (including any underlying transaction between the Borrower or any
Subsidiaries of the Borrower and the beneficiary for which any Letter of Credit
was procured);
(e) the
lack of power or authority of any signer of (or any defect in or forgery of any
signature or endorsement on) or the form of or lack of validity, sufficiency,
accuracy, enforceability or genuineness of any draft, demand, instrument,
certificate or other document presented under or in connection with any Letter
of Credit, or any fraud or alleged fraud in connection with any Letter of
Credit, or the transport of any property or provisions of services relating to a
Letter of Credit, in each case even if the Agent or any of the Agent's
Affiliates has been notified thereof;
(f) payment
by the Agent or any of its Affiliates under any Letter of Credit against
presentation of a demand, draft or certificate or other document which does not
comply with the terms of such Letter of Credit;
(g) the
solvency of, or any acts of omissions by, any beneficiary of any Letter of
Credit, or any other Person having a role in any transaction or obligation
relating to a Letter of Credit, or the existence, nature, quality, quantity,
condition, value or other characteristic of any property or services relating to
a Letter of Credit;
(h) any
failure by the Agent or any of Agent's Affiliates to issue any Letter of Credit
in the form requested by the Borrower, unless the Agent has received written
notice from the Borrower of such failure within three (3) Business Days after
the Agent shall have furnished the Borrower a copy of such Letter of Credit and
such error is material and no drawing has been made thereon prior to receipt of
such notice;
(i) any
adverse change in the business, operations, properties, assets, condition
(financial or otherwise) or prospects of the Borrower or any Subsidiaries of the
Borrower;
(j) any
breach of this Agreement or any other Loan Document by any party
thereto;
(k) the
occurrence or continuance of an Insolvency Proceeding with respect to the
Borrower;
(l) the
fact that an Event of Default or a Potential Default shall have occurred and be
continuing;
(m) the
fact that the Expiration Date shall have passed or this Agreement or the
Commitments hereunder shall have been terminated; and
(n) any
other circumstance or happening whatsoever, whether or not similar to any of the
foregoing.
Notwithstanding
the foregoing, no Lender shall be required to make a Revolving Credit Advance or
a Participation Advance in excess of its Revolving Credit Commitment minus its
Ratable Share of any Letters of Credit Outstanding.
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2.9.8.
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Indemnity.
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In
addition to amounts payable as provided in Section 10.5
[Reimbursement and Indemnification of Agent by the Borrower], the Borrower hereby
agrees to protect, indemnify, pay and save harmless the Agent and any of Agent's
Affiliates that has issued a Letter of Credit from and against any and all
claims, demands, liabilities, damages, taxes (other than income and franchise
taxes), penalties, interest, judgments, losses, costs, charges and expenses
(including reasonable fees, expenses and disbursements of counsel and allocated
costs of internal counsel) which the Agent or any of Agent's Affiliates may
incur or be subject to as a consequence of the issuance of any Letter of Credit,
other than as a result of (a) the gross negligence or willful misconduct of
the Agent as determined by a final judgment of a court of competent jurisdiction
or (b) the wrongful dishonor by the Agent or any of Agent's Affiliates of a
proper demand for payment made under any Letter of Credit, except if such
dishonor resulted from any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or governmental authority (all
such acts or omissions herein called "Governmental Acts").
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2.9.9.
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Liability for Acts and
Omissions.
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As
between the Borrower and the Agent, or the Agent's Affiliates, the Borrower
assumes all risks of the acts and omissions of, or misuse of the Letters of
Credit by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, the Agent shall not be
responsible for any of the following including any losses or damages to the
Borrower or other Person or property relating therefrom: (a) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for an
issuance of any such Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged
(even if the Agent or the Agent's Affiliates shall have been notified thereof);
(b) the validity or sufficiency of any instrument transferring or assigning
or purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (c) the failure of the
beneficiary of any such Letter of Credit, or any other party to which such
Letter of Credit may be transferred, to comply fully with any conditions
required in order to draw upon such Letter of Credit or any other claim of the
Borrower against any beneficiary of such Letter of Credit, or any such
transferee, or any dispute between or among the Borrower and any beneficiary of
any Letter of Credit or any such transferee; (d) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex or otherwise, whether or not they be in cipher;
(e) errors in interpretation of technical terms; (f) any loss or delay
in the transmission or otherwise of any document required in order to make a
drawing under any such Letter of Credit or of the proceeds thereof; (g) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (h) any consequences arising
from causes beyond the control of the Agent or the Agent's Affiliates, as
applicable, including any Governmental Acts, and none of the above shall affect
or impair, or prevent the vesting of, any of the Agent's or the Agent's
Affiliates rights or powers hereunder. Nothing in the preceding
sentence shall relieve the Agent from liability for the Agent's gross negligence
or willful misconduct in connection with actions or omissions described in such
clauses (a) through (h) of such sentence. In no event shall the Agent
or the Agent's Affiliates be liable to the Borrower for any indirect,
consequential, incidental, punitive, exemplary or special damages or expenses
(including without limitation attorneys' fees), or for any damages resulting
from any change in the value of any property relating to a Letter of
Credit.
Without
limiting the generality of the foregoing, the Agent and each of its Affiliates
(i) may rely on any oral or other communication believed in good faith by the
Agent or such Affiliate to have been authorized or given by or on behalf of the
applicant for a Letter of Credit, (ii) may honor any presentation if the
documents presented appear on their face substantially to comply with the terms
and conditions of the relevant Letter of Credit; (iii) may honor a previously
dishonored presentation under a Letter of Credit, whether such dishonor was
pursuant to a court order, to settle or compromise any claim of wrongful
dishonor, or otherwise, and shall be entitled to reimbursement to the same
extent as if such presentation had initially been honored, together with any
interest paid by the Agent or its Affiliate; (iv) may honor any drawing that is
payable upon presentation of a statement advising negotiation or payment, upon
receipt of such statement (even if such statement indicates that a draft or
other document is being delivered separately), and shall not be liable for any
failure of any such draft or other document to arrive, or to conform in any way
with the relevant Letter of Credit; (v) may pay any paying or negotiating bank
claiming that it rightfully honored under the laws or practices of the place
where such bank is located; and (vi) may settle or adjust any claim or demand
made on the Agent or its Affiliate in any way related to any order issued at the
applicant's request to an air carrier, a letter of guarantee or of indemnity
issued to a carrier or any similar document (each an "Order")
and honor any drawing in connection with any Letter of Credit that is the
subject to such Order, notwithstanding that any drafts or other documents
presented in connection with such Letter of Credit fail to conform in any way
with such Letter of Credit.
In
furtherance and extension and not in limitation of the specific provisions set
forth above, any action taken or omitted by the Agent or the Agent's Affiliates
under or in connection with the Letters of Credit issued by it or any documents
and certificates delivered thereunder, if taken or omitted in good faith, shall
not put the Agent or the Agent's Affiliates under any resulting liability to the
Borrower or any Lender.
2.10 Borrowings to Repay Swing
Loans.
PNC Bank
may, at its option, exercisable at any time for any reason whatsoever, demand
repayment of the Swing Loans, and, unless the Borrower makes such repayment from
sources other than a Revolving Credit Loan, each Lender shall make a Revolving
Credit Loan in an amount equal to such Lender's Ratable Share of the aggregate
principal amount of the outstanding Swing Loans, plus, if PNC Bank so requests,
accrued interest thereon, provided that no
Lender shall be obligated in any event to make Revolving Credit Loans in excess
of its Revolving Credit Commitment minus such Lender's Ratable Share of the
amount of the Letters of Credit Outstanding. Revolving Credit Loans
made pursuant to the preceding sentence shall bear interest at the Base Rate
Option and shall be deemed to have been properly requested in accordance with
Section 2.4
[Revolving Credit Loan Requests] without regard to any of the requirements of
that provision. PNC Bank shall provide notice to the Lenders (which
may be telephonic or written notice by letter, facsimile or telex) that such
Revolving Credit Loans are to be made under this Section 2.10
and of the apportionment among the Lenders, and the Lenders shall be
unconditionally obligated to fund such Revolving Credit Loans (whether or not
the conditions specified in Section 2.4
[Revolving Credit Loan Requests] or Section
7.2 [Each Additional Loan or Letter of Credit] are then satisfied) by the
time PNC Bank so requests, which shall not be earlier than 3:00 p.m. Pittsburgh
time on the Business Day next after the date the Lenders receive such notice
from PNC Bank.
2.11 Right to Increase
Commitments.
Provided
that there is no Event of Default or Potential Default, if the Borrower wishes
to increase the Revolving Credit Commitments, the Borrower shall notify the
Agent thereof, provided that any such increase shall be in a minimum of
$10,000,000.00 and the aggregate of all such increases in the Revolving Credit
Commitments shall not exceed $50,000,000.00 from and after the Closing
Date. Each Lender shall have the right at any time within fifteen
(15) days following such notice to increase its respective Revolving Credit
Commitment so as to provide such added commitment pro rata in accordance with
such Lender's Ratable Share, and any portion of such requested increase that is
not provided by any Lender shall: (a) first be available to the other Lenders
pro rata in accordance with their Ratable Share, (b) next be available to the
other Lenders in such a manner as the Borrower, the Agent and those Lenders
shall agree, and (c) thereafter, to the extent not provided by the Lenders, to
any additional bank proposed by the Borrower, which is approved by the Agent
(which approval shall not be unreasonably withheld) and that becomes a party to
this Agreement pursuant to Section
11.11 [Successors and Assigns; Joinder of a Lender]. In the
event of any such increase in the aggregate Revolving Credit Commitments
effected pursuant to the terms of this Section
2.11, which results in a change in the Ratable Share of any Lender, then
on the effective date of any increase (i) the Borrower shall repay all Loans
then outstanding, subject to the Borrower's indemnity obligations set forth in
Section
5.6.2 [Indemnity], provided that the Borrower may
borrow new Loans on such date, with each Lender participating in such new Loans
in accordance with their respective Ratable Shares after giving effect to the
increase in Revolving Credit Commitments contemplated by this Section, and (ii)
each Lender will be deemed to have purchased a participation interest in all
Letters of Credit Outstanding and in all Swing Loans equal to its Ratable Share
after giving effect to the increase in Revolving Credit Commitments contemplated
by this Section. In the event of any such increase in Revolving Credit
Commitments pursuant to this Section, new Notes shall, to the extent necessary,
be executed and delivered by the Borrower in exchange for the surrender of the
existing Notes and the Agent shall amend Schedule
1.1(B) to reflect such increase in Commitments. No Lender shall have any
obligation to increase its Revolving Credit Commitment pursuant to this
Section.
3. INTENTIONALLY
OMITTED
4. INTEREST
RATES
4.1 Interest Rate
Options.
The
Borrower shall pay interest in respect of the outstanding unpaid principal
amount of the Loans as selected by it from the Base Rate Option or Euro-Rate
Option set forth below applicable to the Loans, it being understood that,
subject to the provisions of this Agreement, the Borrower may select different
Interest Rate Options and different Interest Periods to apply simultaneously to
the Loans comprising different Borrowing Tranches and may convert to or renew
one or more Interest Rate Options with respect to all or any portion of the
comprising any Borrowing Tranche, provided that there
shall not be at any one time outstanding more than six (6) Borrowing Tranches in
the aggregate among all of the Loans, and provided further that only the
Swing Loan Interest Rate shall apply to the Swing Loans. If at any
time the designated rate applicable to any Loan made by any Lender exceeds such
Lender's highest lawful rate, the rate of interest on such Lender's Loan shall
be limited to such Lender's highest lawful rate. Notwithstanding
anything to the contrary set forth herein, if an Event of Default or Potential
Default exists and is continuing, the Borrower may not request, convert to, or
renew the Euro-Rate Option for any Loans and the Required Lenders may demand
that all existing Borrowing Tranches bearing interest under the Euro-Rate Option
shall be converted immediately to the Base Rate Option, subject to the
obligation of the Borrower to pay any indemnity under Section
5.6.2 [Indemnity] in connection with such conversion.
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4.1.1.
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Revolving Credit
Interest Rate Options.
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The
Borrower shall have the right to select from the following Interest Rate Options
applicable to the Revolving Credit Loans (subject to the provision above
regarding Swing Loans):
(a) Base Rate
Option: A fluctuating rate per annum (computed on the basis of
a year of 360 days and actual days elapsed) equal to the Base Rate plus the
Applicable Margin, such interest rate to change automatically from time to time
effective as of the effective date of each change in the Base Rate and/or the
Applicable Margin; or
(b) Euro-Rate
Option: A rate per annum (computed on the basis of a year of
360 days and actual days elapsed) equal to the Euro-Rate plus the Applicable
Margin, such interest rate to change automatically from time to time as of the
effective date of each change in the Applicable Margin.
Notwithstanding
the foregoing, if any Event of Default has occurred and is continuing, no Loan
may be made, converted to or renewed under any Euro-Rate Option.
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4.1.2.
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Rate
Quotations.
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The
Borrower may call the Agent on or before the date on which a Loan Request is to
be delivered to receive an indication of the interest rates then in effect, but
it is acknowledged that such projection shall not be binding on the Agent or the
Lenders nor affect the rate of interest which thereafter is actually in effect
when the election is made.
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4.1.3.
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Change in Fees or
Interest Rates.
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If the
Applicable Margin, Applicable Letter of Credit Fee Rate or Applicable Commitment
Fee Rate is increased or reduced with respect to any period for which the
Borrower has already paid interest, the Commitment Fee, or the Letter of Credit
Fee, the Agent shall recalculate the additional interest, Commitment Fee, or
Letter of Credit Fee due from or to the Borrower and shall, within fifteen (15)
Business Days after the Borrower notifies the Agent of such increase or
decrease, give the Borrower and the Lenders notice of such
recalculation.
4.1.3.1 Any
additional interest, Commitment Fee, or Letter of Credit Fee due from the
Borrower shall be paid to the Agent for the account of the Lenders on the next
date on which an interest or fee payment is due; provided, however, that if
there are no Loans outstanding or if the Loans are due and payable, such
additional interest, Commitment Fee, or Letter of Credit Fee shall be paid
promptly after receipt of written request for payment from the
Agent.
4.1.3.2 Any
interest, Commitment Fee, or Letter of Credit Fee refund due to the Borrower
shall be credited against payments otherwise due from the Borrower on the next
interest or fee payment due date or, if the Loans have been repaid and the
Lenders are no longer committed to lend under this Agreement, the Lenders shall
pay the Agent for the account of the Borrower such interest, Commitment Fee, or
Letter of Credit Fee refund not later than five Business Days after written
notice from the Agent to the Lenders.
4.2 Interest
Periods.
At any
time when the Borrower shall select, convert to or renew a Euro-Rate Option, the
Borrower shall notify the Agent thereof by delivering a Loan Request at least
three (3) Business Days prior to the effective date of such Interest Rate
Option. The notice shall specify an Interest Period during
which such Interest Rate Option shall apply. Notwithstanding the
preceding sentence, the following provisions shall apply to any selection of,
renewal of, or conversion to a Euro-Rate Option:
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4.2.1.
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Amount of Borrowing
Tranche.
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the
amount of each Borrowing Tranche of Loans to which a Euro-Rate Option applies
shall be in integral multiples of $1,000,000.00 and not less than
$3,000,000.00;
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4.2.2.
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Renewals.
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in the
case of the renewal of a Euro-Rate Option at the end of an Interest Period, the
first day of the new Interest Period shall be the last day of the preceding
Interest Period, without duplication in payment of interest for such
day.
4.3 Interest After
Default.
To the
extent permitted by Law, upon the occurrence of an Event of Default and until
such time such Event of Default shall have been cured or waived:
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4.3.1.
|
Letter of Credit Fees,
Interest Rate.
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the
Letter of Credit Fee and the rate of interest for each Loan otherwise applicable
pursuant to Section 2.9.2
[Letter of Credit Fees] or Section 4.1
[Interest Rate Options], respectively, shall be increased by 2.0% per annum;
and
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4.3.2.
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Other
Obligations.
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each
other Obligation hereunder if not paid when due shall bear interest at a rate
per annum equal to the sum of the rate of interest applicable under the Base
Rate Option plus an additional 2% per annum from the time such Obligation
becomes due and payable and until it is paid in full.
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4.3.3.
|
Acknowledgment.
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The
Borrower acknowledges that the increase in rates referred to in this Section 4.3
reflects, among other things, the fact that such Loans or other amounts have
become a substantially greater risk given their default status and that the
Lenders are entitled to additional compensation for such risk; and all such
interest shall be payable by the Borrower upon demand by the Agent.
4.4 Euro-Rate
Unascertainable; Illegality; Increased
Costs; Deposits Not Available.
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4.4.1.
|
Unascertainable.
|
If on any
date on which a Euro-Rate would otherwise be determined with respect to Loans,
the Agent shall have determined that:
(a) adequate
and reasonable means do not exist for ascertaining such Euro-Rate,
or
(b) a
contingency has occurred which materially and adversely affects the London
interbank eurodollar market relating to the Euro-Rate, then the Agent shall have
the rights specified in Section 4.4.3 [The Agent's and
Lenders' Rights].
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4.4.2.
|
Illegality; Increased
Costs; Deposits Not
Available.
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If at any
time any Lender shall have determined that:
(a) the
making, maintenance or funding of any Loan to which a Euro-Rate Option applies
has been made unlawful or materially impracticable by compliance by such Lender
in good faith with any Law or any interpretation or application thereof by any
Official Body or with any request or directive of any such Official Body
(whether or not having the force of Law), or
(b) such
Euro-Rate Option will not adequately and fairly reflect the cost to such Lender
of the establishment or maintenance of any such Loan in a material respect,
or
(c) after
making all reasonable efforts, deposits of the relevant amount in Dollars for
the relevant Interest Period for a Loan, or to banks generally, to which a
Euro-Rate Option applies, respectively, are not available to such Lender with
respect to such Loan, or to banks generally, in the interbank eurodollar market,
then the Agent shall have the rights specified in Section 4.4.3
[The Agent's and Lenders' Rights].
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4.4.3.
|
The Agent's and
Lenders' Rights.
|
In the
case of any event specified in Section 4.4.1 [Unascertainable]
above, the Agent shall promptly so notify the Lenders and the Borrower thereof,
and in the case of an event specified in Section 4.4.2
[Illegality; Increased Costs; Deposits Not Available] above, such Lender shall
promptly so notify the Agent and endorse a certificate to such notice as to the
specific circumstances of such notice, and the Agent shall promptly send copies
of such notice and certificate to the other Lenders and the
Borrower. Upon such date as shall be specified in such notice (which
shall not be earlier than the date such notice is given), the obligation of
(a) the Lenders, in the case of such notice given by the Agent, or
(b) such Lender, in the case of such notice given by such Lender, to allow
the Borrower to select, convert to or renew a Euro-Rate Option shall be
suspended until the Agent shall have later notified the Borrower, or such Lender
shall have later notified the Agent, of the Agent's or such Lender's, as the
case may be, determination that the circumstances giving rise to such previous
determination no longer exist. If at any time the Agent makes a
determination under Section 4.4.1
[Unascertainable] and the Borrower has previously notified the Agent of its
selection of, conversion to or renewal of a Euro-Rate Option and such Interest
Rate Option has not yet gone into effect, such notification shall be deemed to
provide for the selection of, conversion to or renewal of the Base Rate Option
otherwise available with respect to such Loans if the Borrower has requested the
Euro-Rate Option. If any Lender notifies the Agent of a determination
under Section 4.4.2
[Illegality; Increased Costs; Deposits Not Available], the Borrower shall,
subject to the Borrower's indemnification Obligations under Section 5.6.2
[Indemnity], as to any Loan of the Lender to which a Euro-Rate Option applies,
on the date specified in such notice either (i) as applicable, convert such Loan
to the Base Rate Option otherwise available with respect to such Loan, or
(ii) prepay such Loan in accordance with Section 5.4.1
[Voluntary Prepayments]. Absent due notice from the Borrower of
conversion or prepayment, such Loan shall automatically be converted to the Base
Rate Option otherwise available with respect to such Loan upon such specified
date.
4.5 Selection of Interest Rate
Options.
If the
Borrower fails to select a new Interest Period to apply to any Borrowing Tranche
of Loans under the Euro-Rate Option at the expiration of an existing Interest
Period applicable to such Borrowing Tranche in accordance with the provisions of
Section 4.2
[Interest Periods], the Borrower shall be deemed to have converted such
Borrowing Tranche to the Base Rate Option, commencing upon the last day of the
existing Interest Period.
5. PAYMENTS
5.1 Payments.
All
payments and prepayments to be made in respect of principal, interest,
Commitment Fee, Letter of Credit Fees, Agent's Fee or other fees or amounts due
from the Borrower hereunder shall be payable prior to 11:00 a.m., Pittsburgh
time, on the date when due without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived by the Borrower, and without
set-off, counterclaim or other deduction of any nature, and an action therefor
shall immediately accrue. Such payments shall be made to the Agent at
the Principal Office for the account of PNC Bank with respect to the Swing
Loans, for the account of the Issuing Lender with respect to Letters of Credit
(except for the Letter of Credit Fee, which shall be payable to the Agent for
the account of the Lenders as provided herein), and for the ratable accounts of
the Lenders with respect to the Revolving Credit Loans and the Letter of Credit
Fee, and in immediately available funds, and the Agent shall promptly distribute
such amounts to the Lenders in immediately available funds, provided that in the
event payments are received by 11:00 a.m., Pittsburgh time, by the Agent with
respect to the Loans and such payments are not distributed to the Lenders on the
same day received by the Agent, the Agent shall pay the Lenders the Federal
Funds Effective Rate, with respect to the amount of such payments for each day
held by the Agent and not distributed to the Lenders. The Agent's and
each Lender's statement of account, ledger or other relevant record shall, in
the absence of manifest error, be conclusive as the statement of the amount of
principal of and interest on the Loans and other amounts owing under this
Agreement and shall be deemed an "account stated."
5.2 Pro Rata Treatment of
Lenders;
Sharing of Payments; Agent's Presumptions.
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5.2.1.
|
Pro Rata Treatment of
Lenders.
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Each
borrowing of Loans shall be allocated to each Lender according to its Ratable
Share and each selection of, conversion to or renewal of any Interest Rate
Option applicable to the Loans and each payment or prepayment by the Borrower
with respect to principal or interest on the Loans or Commitment Fees, Letter of
Credit Fees, or other fees (except for the Agent's Fee and fees and interest
paid solely for the account of the Issuing Lender or PNC Bank as Swing Loan
Lender) or amounts due from the Borrower hereunder to the Lenders with respect
to the Loans shall (except as otherwise may be provided with respect to a
Defaulting Lender or a Delinquent Lender and as provided in Section 4.4.3
[The Agent's and Lenders' Rights] in the case of an event specified in Sections 4.4
[Euro-Rate Unascertainable; Etc.], 5.4.2
[Replacement of a Lender] or 5.6
[Additional Compensation in Certain Circumstances]) be made in proportion to the
applicable Loans outstanding from each Lender and, if no such Loans are then
outstanding, in proportion to the Ratable Share. Notwithstanding any
of the foregoing, each borrowing or payment or prepayment by the Borrower of
principal, interest, fees or other amounts from the Borrower with respect to
Swing Loans shall be made by or to PNC Bank according to Section 2.
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5.2.2.
|
Sharing of Payments by
Lenders.
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If any
Lender shall, by exercising any right of setoff, counterclaim or banker's lien,
by receipt of voluntary payment, by realization upon security, or by any other
non-pro rata source, obtain payment in respect of any principal of or interest
on any of its Loans or other obligations hereunder resulting in such Lender's
receiving payment of a proportion of the aggregate amount of its Loans and
accrued interest thereon or other such obligations greater than its Ratable
Share thereof as provided herein, then the Lender receiving such greater
proportion shall (a) notify the Agent of such fact, and (b) purchase
(for cash at face value) participations in the Loans and such other obligations
of the other Lenders, or make such other adjustments as shall be equitable, so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and other amounts owing them, provided that:
(i) if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, together with interest
or other amounts, if any, required by Law (including court order) to be paid by
the Lender or the holder making such purchase; and
(ii) the
provisions of this Section shall not be construed to apply to (A) any
payment made by the Borrower pursuant to and in accordance with the express
terms of the Loan Documents or (B) any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans or Participation Advances to any assignee or participant, other than to
the Borrower or any Subsidiary thereof (as to which the provisions of this
Section shall apply).
The Borrower consents to the foregoing
and agrees, to the extent it may effectively do so under applicable Law, that
any Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of setoff and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.
Notwithstanding anything to the
contrary contained in this Agreement or any of the other Loan Documents, any
Lender that fails at any time to comply with the provisions of this Section with
respect to purchasing participations from the other Lenders whereby such
Lender’s share of any payment received, whether by setoff or otherwise, is in
excess of its Ratable Share of such payments due and payable to all of the
Lenders, when and to the full extent required by the provisions of this
Agreement, shall be deemed delinquent (a "Delinquent
Lender") and shall be deemed a Delinquent Lender until such time as each
such delinquency and all of its obligations hereunder are
satisfied. A Delinquent Lender shall be deemed to have assigned any
and all payments due to it from the Borrower, whether on account of or relating
to outstanding Loans, Letters of Credit, interest, fees or otherwise, to the
remaining nondelinquent Lenders for application to, and reduction of, their
respective Ratable Share of all outstanding Loans and other unpaid Obligations
of the Borrower. The Delinquent Lender hereby authorizes the Agent to
distribute such payments to the nondelinquent Lenders in proportion to their
respective Ratable Share of all outstanding Loans and other unpaid Obligations
of Borrower. A Delinquent Lender shall be deemed to have satisfied in
full a delinquency when and if, as a result of application of the assigned
payments to all outstanding Loans and other unpaid Obligations of the Borrower
to the nondelinquent Lenders, the Lenders’ respective Ratable Share of all
outstanding Loans and unpaid Obligations have returned to those in effect
immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency.
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5.2.3.
|
Presumptions by the
Agent.
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Unless
the Agent shall have received notice from the Borrower prior to the date on
which any payment is due to the Agent for the account of the Lenders or the
Issuing Lender hereunder that the Borrower will not make such payment, the Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Lender, as the case may be, the amount due. In such
event, if the Borrower has not in fact made such payment, then each of the
Lenders or the Issuing Lender, as the case may be, severally agrees to repay to
the Agent forthwith on demand the amount so distributed to such Lender or the
Issuing Lender, with interest thereon, for each day from and including the date
such amount is distributed to it to but excluding the date of payment to the
Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Agent in accordance with banking industry rules on interbank
compensation.
5.3 Interest Payment
Dates.
Interest
on Swing Loans and on Loans to which the Base Rate Option applies shall be due
and payable quarterly in arrears on the first day of each January, April, July
and October after the date hereof and on the Expiration Date, or upon
acceleration of the Loans. Interest on Loans to which the Euro-Rate
Option applies shall be due and payable on the last day of each Interest Period
for those Loans and, if such Interest Period is longer than three (3) Months,
also on the 90th day of such Interest Period.
5.4 Prepayments.
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5.4.1.
|
Voluntary
Prepayments.
|
The
Borrower shall have the right at its option from time to time to prepay the
Loans in whole or part without premium or penalty (except as provided in Section 5.4.2
[Replacement of a Lender] below or in Section 5.6
[Additional Compensation in Certain Circumstances]):
(a) at
any time with respect to Swing Loans or with respect to any Loan to which the
Base Rate Option applies,
(b) on
the last day of the applicable Interest Period with respect to Loans to which a
Euro-Rate Option applies, or
(c) on
the date specified in a notice by any Lender pursuant to Section 4.4
[Euro-Rate Unascertainable, Etc.] with respect to any Loan to which a Euro-Rate
Option applies.
Whenever
the Borrower desires to prepay any part of the Loans, it shall provide a
prepayment notice to the Agent by 1:00 p.m., Pittsburgh time, at least one (1)
Business Day prior to the date of prepayment of the Revolving Credit Loans or no
later than 2:00 p.m., Pittsburgh time, on the date of prepayment of Swing Loans,
setting forth the following information:
(i) the
date, which shall be a Business Day, on which the proposed prepayment is to be
made;
(ii) a
statement indicating the application of the prepayment among the Revolving
Credit Loans and Swing Loans;
(iii) the
total principal amount of such prepayment, which, with respect to Loans to which
the Base Rate Option applies shall not be less than $500,000.00 for any
Revolving Credit Loan, unless such repayment is of the total amount outstanding
with regard to such Revolving Credit Loan, and which, with respect to Swing
Loans, shall be the total amount thereof, and
(iv) the
total principal amount of such prepayment, which, with respect to Loans to which
the Euro-Rate Option applies, shall not be less than $1,000,000.00 for any
Revolving Credit Loan, unless such repayment is of the total amount outstanding
with regard to such Revolving Credit Loan.
All
prepayment notices shall be irrevocable. The principal amount of the
Loans for which a prepayment notice is given, together with interest on such
principal amount except with respect to Loans to which the Base Rate Option
applies, shall be due and payable on the date specified in such prepayment
notice as the date on which the proposed prepayment is to be
made. Except as provided in Section 4.4.3
[Agent's and Lender's Rights], if the Borrower prepays a Loan but fails to
specify the applicable Borrowing Tranche which the Borrower is prepaying, the
prepayment shall be applied (A) first to Swing Loans and second to
Revolving Credit Loans; and (B) after giving effect to the allocations in
clause (A) above and in the preceding sentence, first to Loans to which the
Swing Loan Interest Rate applies, second to Loans to which the Base Rate Option
applies, and then to Loans to which the Euro-Rate Option applies. Any
prepayment hereunder shall be subject to the Borrower's Obligation to indemnify
the Lenders under Section 5.6.2
[Indemnity].
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5.4.2.
|
Replacement of a
Lender.
|
In the
event any Lender (a) gives notice under Section 4.4
[Euro-Rate Unascertainable, Etc.], (b) requests compensation under Section 5.6.1
[Increased Costs, Etc.] or Section
5.8 [Taxes], (c) is a Defaulting Lender, (d) becomes subject to
the control of an Official Body (other than normal and customary supervision),
(e) is a Non-Consenting Lender referred to in Section
11.1 [Modifications, Amendments or Waivers], or (f) causes the Borrower
to pay, withhold or indemnify any Taxes or Other Taxes pursuant to Section
5.8 [Taxes], then in any such event the Borrower may, at its sole
expense, upon notice to such Lender and the Agent, require such Lender to assign
and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 11.11
[Successors and Assigns]), all of its interests, rights and obligations under
this Agreement and the related Loan Documents to an assignee that shall assume
such obligations (which assignee may be another Lender, if a Lender accepts such
assignment), provided
that:
(i) the
Borrower shall have paid to the Agent the assignment fee specified in Section
11.11 [Successors and Assigns];
(ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and Participation Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section
5.6.2 [Indemnity]) from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or the Borrower (in the case of all
other amounts);
(iii) in the
case of any such assignment resulting from a claim for compensation under Section 5.6.1
[Increased Costs, Etc.] or payments required to be made pursuant to Section 5.8
[Taxes], such assignment will result in a reduction in such compensation or
payments thereafter; and
(iv) such
assignment does not conflict with applicable Law.
A Lender
shall not be required to make any such assignment or delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to
apply. Notwithstanding the foregoing, the Agent may only be replaced
in accordance with Section 10.14
[Resignation of Agent].
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5.4.3.
|
Change of Lending
Office.
|
Each
Lender agrees that prior to giving notice to any claim for increased costs,
indemnification or other special payments under Sections 4.4.2
[Illegality, Etc.], 5.6.1
[Increased Costs, Etc.] or Section 5.8
[Taxes] with respect to such Lender, it will have initiated reasonable efforts
(subject to overall policy considerations of such Lender) to designate another
lending office for any Loans or Letters of Credit affected by such event, provided that such
designation is made on such terms that such Lender and its lending office suffer
no economic, legal or regulatory disadvantage, with the object of avoiding the
consequence of the event giving rise to the operation of such
Section. Nothing in this Section 5.4.3
shall affect or postpone any of the Obligations of the Borrower or the rights of
the Agent or any Lender provided in this Agreement.
5.5 Voluntary Commitment
Reductions.
The
Borrower shall have the right, upon not less than five (5) Business Days'
written irrevocable notice to the Agent, to terminate the Commitments or, from
time to time, to reduce the amount of the Commitments, which notice shall
specify the date and amount of any such reduction and otherwise be substantially
in the form of Exhibit 5.5
(a "Commitment
Reduction Notice"). Any such reduction shall be in a minimum
amount equal to $5,000,000.00 or an integral multiple thereof, unless the
Commitments are reduced to zero and this Agreement terminated; provided, that the
Revolving Credit Commitments may not be reduced below the aggregate principal
amount of the Revolving Facility Usage. Each reduction of Revolving
Credit Commitments shall ratably reduce the Revolving Credit Commitments of the
Lenders.
5.6 Additional Compensation in
Certain Circumstances.
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5.6.1.
|
Increased Costs or
Reduced Return Resulting From Taxes, Reserves, Capital Adequacy
Requirements, Expenses, Etc.
|
If any
Law, guideline or interpretation or any change in any Law, guideline or
interpretation or application thereof by any Official Body charged with the
interpretation or administration thereof or compliance with any request or
directive (whether or not having the force of Law) of any central bank or other
Official Body:
(a) subjects
any Lender to any tax or changes the basis of taxation with respect to this
Agreement, the Loans or payments by the Borrower of principal, interest,
Commitment Fees, Letter of Credit Fees or other amounts due from the Borrower
hereunder (except for taxes on the overall net income of such
Lender),
(b) imposes,
modifies or deems applicable any reserve, special deposit or similar requirement
against credits or commitments to extend credit extended by, or assets (funded
or contingent) of, deposits with or for the account of, or other acquisitions of
funds by, any Lender or any lending office of any Lender, or
(c) imposes,
modifies or deems applicable any capital adequacy or similar requirement
(i) against assets (funded or contingent) of, or letters of credit, other
credits or commitments to extend credit extended by, any Lender (or its holding
company), or (ii) otherwise applicable to the obligations of any Lender or
any lending office of any Lender (or its holding company) under this Agreement,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon any
Lender (or its holding company) or its lending office with respect to this
Agreement or the making, maintenance or funding of any part of the Loans (or, in
the case of any capital adequacy or similar requirement, to have the effect of
reducing the rate of return on any Lender's capital, taking into consideration
such Lender's (or its holding company's) customary policies with respect to
capital adequacy) by an amount which such Lender in its reasonable discretion
deems to be material, such Lender shall from time to time notify the Borrower
and the Agent of the amount determined in good faith (using any averaging and
attribution methods employed in good faith) by such Lender to be necessary to
compensate such Lender for such increase in cost, reduction of income,
additional expense or reduced rate of return. Such notice shall set
forth in reasonable detail the basis for such determination. Such
amount shall be due and payable by the Borrower to such Lender thirty (30) days
after such notice is given.
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5.6.2.
|
Indemnity.
|
In
addition to the compensation required by Section 5.6.1
[Increased Costs, Etc.], the Borrower shall indemnify each Lender against all
direct liabilities, losses or expenses (including loss of margin, any loss or
expense incurred in liquidating or employing deposits from third parties and any
loss or expense incurred in connection with funds acquired by a Lender to fund
or maintain Loans subject to a Euro-Rate Option) which such Lender actually
sustains or incurs as a consequence of any
(a) payment,
prepayment, conversion or renewal of any Loan to which a Euro-Rate Option
applies on a day other than the last day of the corresponding Interest Period
(whether or not such payment or prepayment is mandatory, voluntary or automatic
and whether or not such payment or prepayment is then due),
(b) attempt
by the Borrower to revoke (expressly, by later inconsistent notices or
otherwise) in whole or part any Loan Requests under Section 2.4
[Revolving Credit Loan Requests], Section
2.5 [Swing Loan Requests] or Section 4.2
[Interest Periods] or notice relating to voluntary prepayments under Section 5.4.1
[Voluntary Prepayments] or notice relating to voluntary Commitment reductions
under Section 5.5
[Voluntary Commitment Reductions],
(c) default
by the Borrower in the performance or observance of any covenant or condition
contained in this Agreement or any other Loan Document, including any failure of
the Borrower to pay when due (by acceleration or otherwise) any principal of or
interest on the Loans, Letter of Credit Fees, or Commitment Fees or any other
amount due hereunder; or
(d) the
assignment of any Loan to which a Euro-Rate Option applies, as a result of the
Borrower's exercise of its rights to replace a Lender under Section
5.4.2 [Replacement of a Lender].
If any
Lender sustains or incurs any such loss or expense, it shall from time to time
notify the Borrower of the amount determined in good faith by such Lender (which
determination may include such assumptions, allocations of costs and expenses
and averaging or attribution methods as such Lender shall deem reasonable) to be
necessary to indemnify such Lender for such loss or expense. Such
notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrower
to such Lender thirty (30) days after such notice is given.
5.7 Interbank Market
Presumption.
Except as
otherwise expressly provided herein, for all purposes of this Agreement and each
Note with respect to any aspects of the Euro-Rate or any Loan under the
Euro-Rate Option, each Lender and the Agent shall be presumed to have obtained
rates, funding, currencies, deposits, and the like in the London interbank
market regardless whether it did so or not; and, each Lender's and the Agent's
determination of amounts payable under, and actions required or authorized by,
Sections
4.4
[Euro-Rate Unascertainable; Illegality; Increased Costs; Deposits Not Available]
and 5.6
[Additional Compensation in Certain Circumstances] shall be calculated, at each
Lender's and Agent's option, as though each Lender and Agent funded its pro rata
share of each Borrowing Tranche of Loans under the Euro-Rate Option through the
purchase of deposits of the types and maturities corresponding to the deposits
used as a reference in accordance with the terms hereof in determining the
Euro-Rate applicable to such Loans, whether in fact that is the
case.
5.8 Taxes.
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5.8.1.
|
No
Deductions.
|
All
payments made by the Borrower hereunder and under each Note shall be made free
and clear of and without deduction for any present or future taxes, levies,
imposts, deductions, charges, or withholdings, and all liabilities with respect
thereto, excluding taxes imposed on the net income of any Lender and all income
and franchise taxes applicable to any Lender of the United States (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings, and
liabilities being hereinafter referred to as "Taxes"). If
the Borrower shall be required by Law to deduct any Taxes from or in respect of
any sum payable hereunder or under any Note (a) the sum payable shall be
increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section 5.8.1)
each Lender receives an amount equal to the sum it would have received had no
such deductions been made, (b) the Borrower shall make such deductions and
(c) the Borrower shall timely pay the full amount deducted to the relevant
tax authority or other authority in accordance with applicable Law.
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5.8.2.
|
Stamp
Taxes.
|
In
addition, the Borrower agrees to pay any present or future stamp or documentary
taxes or any other excise or property taxes, charges, or similar levies which
arise from any payment made hereunder or from the execution, delivery, or
registration of, or otherwise with respect to, this Agreement or any Note
(hereinafter referred to as "Other
Taxes").
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5.8.3.
|
Indemnification for
Taxes Paid by a Lender.
|
The
Borrower shall indemnify each Lender for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section
5.8.3)
paid by any Lender and any liability (including penalties, interest, and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted. This
indemnification shall be made within 30 days from the date a Lender makes
written demand therefor.
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5.8.4.
|
Certificate.
|
Within 30
days after the date of any payment of any Taxes by the Borrower, the Borrower
shall furnish to each Lender, at its address referred to herein, the original or
a certified copy of a receipt evidencing payment thereof. If no Taxes
are payable in respect of any payment by the Borrower, the Borrower shall, if so
requested by a Lender, provide a certificate of an officer of the Borrower to
that effect.
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5.8.5.
|
Survival.
|
Without
prejudice to the survival of any other agreement of the Borrower hereunder, the
agreements and obligations of the Borrower contained in Sections
5.8.1
[No Deductions] through and including 5.8.4
[Certificate] shall survive the payment in full of principal and interest
hereunder and under any instrument delivered hereunder.
5.9 Notes.
Upon the
request of any Lender, the Revolving Credit Loans made by such Lender may be
evidenced by a Revolving Credit Note in the form of Exhibit 1.1(R).
5.10 Settlement Date
Procedures.
In order
to minimize the transfer of funds between the Lenders and the Agent, the
Borrower may borrow, repay and reborrow Swing Loans and PNC Bank may make Swing
Loans as provided in Section
2.1.2 [Swing Loan Commitment] hereof during the period between Settlement
Dates. Not later than 11:00 a.m., Pittsburgh time, on each Settlement
Date, the Agent shall notify each Lender of its Ratable Share of the total of
the Revolving Credit Loans and the Swing Loans (each a "Required
Share"). Prior to 2:00 p.m., Pittsburgh time, on such
Settlement Date, each Lender shall pay to the Agent the amount equal to the
difference between its Required Share and its Revolving Credit Loans, and the
Agent shall pay to each Lender its Ratable Share of all payments made by the
Borrower to the Agent with respect to the Revolving Credit Loans. The
Agent shall also effect settlement in accordance with the foregoing sentence on
the proposed Borrowing Dates for Revolving Credit Loans and may at its option
effect settlement on any other Business Day. These settlement
procedures are established solely as a matter of administrative convenience, and
nothing contained in this Section 5.10
shall relieve the Lenders of their obligations to fund Revolving Credit Loans on
dates other than a Settlement Date pursuant to Sections 2.1.1
[Revolving Credit Loans] and 2.2
[Nature of Lenders' Obligations with Respect to Revolving Credit
Loans]. The Agent may at any time at its option for any reason
whatsoever require each Lender to pay immediately to the Agent such Lender's
Ratable Share of the outstanding Revolving Credit Loans and each Lender may at
any time require the Agent to pay immediately to such Lender its Revolving
Credit Ratable Share of all payments made by the Borrower to the
Agent with respect to the Revolving Credit Loans.
6. REPRESENTATIONS AND
WARRANTIES
6.1 Representations and
Warranties.
The
Borrower represents and warrants to the Agent and each of the Lenders as
follows:
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6.1.1.
|
Organization and
Qualification.
|
The
Borrower and each Subsidiary of the Borrower that is not an Inactive Subsidiary
is a corporation, partnership or limited liability company duly organized,
validly existing and in good standing under the laws of the State of
New Jersey in the case of the Borrower, or its respective jurisdiction of
organization in the case of such Subsidiary. The Borrower and each
Subsidiary of the Borrower that is not an Inactive Subsidiary has the lawful
power to own or lease its properties and to engage in the business it presently
conducts or proposes to conduct. The Borrower and each Subsidiary of
the Borrower that is not an Inactive Subsidiary is duly licensed or qualified
and in good standing in each jurisdiction where the failure to be so licensed or
qualified could reasonably be expected to result in a Material Adverse
Change.
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6.1.2.
|
Subsidiaries.
|
Schedule
6.1.2
states the name of each of the Borrower's Subsidiaries, its jurisdiction of
incorporation, its authorized capital stock, the issued and outstanding shares
(referred to herein as the "Subsidiary
Shares") and the owners thereof if it is a corporation, its outstanding
partnership interests (the "Partnership
Interests") if it is a partnership and its outstanding limited liability
company interests, interests assigned to managers thereof and the voting rights
associated therewith (the "LLC
Interests") if it is a limited liability company and also indicates if
such Subsidiary is an Inactive Subsidiary. The Borrower and each
Subsidiary of the Borrower has good and marketable title to all of the
Subsidiary Shares, Partnership Interests and LLC Interests it purports to own,
free and clear in each case of any Lien. All Subsidiary Shares,
Partnership Interests and LLC Interests have been validly issued, and all
Subsidiary Shares are fully paid and nonassessable. All capital
contributions and other consideration required to be made or paid in connection
with the issuance of the Partnership Interests and LLC Interests have been made
or paid, as the case may be. There are no options, warrants or other rights
outstanding to purchase any such Subsidiary Shares, Partnership Interests or LLC
Interests except as indicated on Schedule
6.1.2.
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6.1.3.
|
Power and
Authority.
|
The
Borrower has full power to enter into, execute, deliver and carry out this
Agreement and the other Loan Documents to which it is a party, to incur the
Indebtedness contemplated by the Loan Documents and to perform its Obligations
under the Loan Documents to which it is a party, and all such actions have been
duly authorized by all necessary proceedings on its part.
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6.1.4.
|
Validity and Binding
Effect.
|
This
Agreement has been duly and validly executed and delivered by the Borrower, and
each other Loan Document which the Borrower is required to execute and deliver
on or after the date hereof will have been duly executed and delivered by the
Borrower on the required date of delivery of such Loan Document. This
Agreement and each other Loan Document constitutes, or will constitute, legal,
valid and binding obligations of the Borrower on and after its date of delivery
thereof, enforceable against the Borrower in accordance with its terms, except
to the extent that enforceability of any of such Loan Document may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforceability of creditors' rights generally or limiting the
right of specific performance.
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6.1.5.
|
No
Conflict.
|
Neither
the execution and delivery of this Agreement or the other Loan Documents by the
Borrower nor the consummation of the transactions herein or therein contemplated
or compliance with the terms and provisions hereof or thereof by the Borrower
will conflict with, constitute a default under or result in any breach of
(a) the terms and conditions of the certificate of incorporation, bylaws,
certificate of limited partnership, partnership agreement, certificate of
formation, limited liability company agreement or other organizational documents
of the Borrower or (b) any Law or any material agreement or instrument or
order, writ, judgment, injunction or decree to which the Borrower or any of its
Subsidiaries is a party or by which it or any of its Subsidiaries is bound or to
which it is subject, or result in the creation or enforcement of any Lien,
charge or encumbrance whatsoever upon any property (now or hereafter acquired)
of the Borrower or any of its Subsidiaries (other than Liens granted under the
Loan Documents and other than Permitted Liens).
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6.1.6.
|
Litigation.
|
Except as
set forth in the SEC Filings, there are no actions, suits, proceedings or
investigations (other than Environmental Complaints which are specifically
addressed in Section 6.1.21
[Environmental Matters]) pending or, to the knowledge of the Borrower,
threatened against the Borrower or any Subsidiary of the Borrower at law or
equity before any Official Body which individually or in the aggregate could
reasonably be expected to result in a Material Adverse Change. None
of the Borrower or any Subsidiaries of the Borrower is in violation of any
order, writ, injunction or any decree of any Official Body which could
reasonably be expected to result in any Material Adverse Change.
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6.1.7.
|
Title to
Properties.
|
The
Borrower and each Subsidiary of the Borrower has good and marketable title to or
valid leasehold interest in all properties, assets and other rights which it
purports to own or lease or which are reflected as owned or leased on its books
and records, free and clear of all Liens (other than Environmental Complaints
which are specifically addressed in Section 6.1.21
[Environmental Matters]) except Permitted Liens, and subject to the terms and
conditions of the applicable leases, except where the failure to hold such
assets and other rights subject to such terms and conditions could reasonably be
expected to result in a Material Adverse Change. All leases of
property are in full force and effect without the necessity for any consent
which has not previously been obtained upon consummation of the transactions
contemplated hereby to the extent that the failure of such leases to be in full
force and effect or to have obtained any such consent could reasonably be
expected to result in a Material Adverse Change.
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6.1.8.
|
Financial
Statements.
|
(a) Historical
Statements. The Borrower has delivered to the Agent copies of
its audited consolidated year-end financial statements for and as of the end of
the fiscal year ended September 30, 2008, and its unaudited consolidated
financial statements for and as of the end of the fiscal quarters ended
December 31, 2008, March 31, 2009 and June 30, 2009 (the "Historical
Statements"). The Historical Statements were compiled from the
books and records maintained by the Borrower's management, are correct and
complete and fairly represent the consolidated financial condition of the
Borrower and its Subsidiaries as of their dates and the results of operations
for the fiscal periods then ended and have been prepared in accordance with GAAP
consistently applied (subject, in the case of such quarterly financial
statements, to normal year-end adjustments and the absence of footnote
disclosures).
(b) Accuracy
of Financial Statements. Neither the Borrower nor any
Subsidiary of the Borrower has any material (either individually or in the
aggregate) liabilities, contingent or otherwise, or forward or long-term
commitments that are not disclosed in the Historical Statements or in the notes
thereto, and except as disclosed therein there are no unrealized or anticipated
losses from any commitments of the Borrower or any Subsidiary of the Borrower
that could reasonably be expected to cause a Material Adverse
Change. Since September 30, 2009, no Material Adverse
Change has occurred.
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6.1.9.
|
Use of Proceeds;
Margin Stock; Section 20
Subsidiaries.
|
6.1.9.1 General.
The
Borrower intends to use the proceeds of the Loans in accordance with Sections 2.8
[Use of Proceeds] and 8.1.10
[Use of Proceeds].
6.1.9.2 Margin
Stock.
Neither
the Borrower nor any Subsidiary of the Borrower engages or intends to engage
principally, or as one of its important activities, in the business of extending
credit for the purpose, immediately, incidentally or ultimately, of purchasing
or carrying margin stock (within the meaning of Regulation U). No
part of the proceeds of any Loan has been or will be used, immediately,
incidentally or ultimately, to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock or
to refund Indebtedness originally incurred for such purpose, or for any purpose
which entails a violation of or which is inconsistent with the provisions of the
regulations of the Board of Governors of the Federal Reserve
System. Neither the Borrower nor any Subsidiary of the Borrower holds
or intends to hold margin stock in such amounts that more than 25% of the
reasonable value of the assets of the Borrower or any Subsidiary of the Borrower
is or will be represented by margin stock.
6.1.9.3 Section
20 Subsidiaries.
The
Borrower is unaware of any circumstances where any portion of the proceeds of
the Loans would be used to purchase any Ineligible Securities being underwritten
by a Section 20
Subsidiary.
|
6.1.10.
|
Full
Disclosure.
|
Neither
this Agreement nor any other Loan Document, nor any certificate, statement,
agreement or other documents furnished to the Agent or any Lender in connection
herewith or therewith, contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements contained
herein and therein, in light of the circumstances under which they were made,
not misleading. There is no fact known to the Borrower that could
reasonably be expected to result in a Material Adverse Change which has not been
set forth in this Agreement or in the certificates, statements, agreements or
other documents furnished in writing to the Agent and the Lenders prior to or at
the date hereof in connection with the transactions contemplated hereby or
otherwise disclosed in the SEC Filings.
|
6.1.11.
|
Taxes.
|
All
federal, state, local and other tax returns required to have been filed with
respect to the Borrower and each Subsidiary of the Borrower on or prior to the
Closing Date have been filed, and payment or adequate provision has been made
for the payment of all taxes, fees, assessments and other governmental charges
which have or may become due pursuant to said returns or to assessments
received, except (a) to the extent that such taxes, fees, assessments and other
charges are being contested in good faith by appropriate proceedings diligently
conducted and for which such reserves or other appropriate provisions if any, as
shall be required by GAAP shall have been made or (b) to the extent that with
respect to taxes (other than any U.S. federal or state income taxes, state taxes
on equity or capital or comparable state taxes on income, equity or capital and
which are otherwise related to the conduct of business or local real property
taxes all of which taxes are subject to the requirements of the immediately
preceding clause (a)), fees, assessments or other government charges, the
failure to so pay or so contest could not reasonably be expected to result in a
Material Adverse Change. There are no agreements or waivers extending
the statutory period of limitations applicable to any federal income tax return
of the Borrower or any Subsidiary of the Borrower for any period.
|
6.1.12.
|
Consents and
Approvals.
|
No
consent, approval, exemption, order or authorization of, or a registration or
filing with, any Official Body or any other Person is required by any Law or any
agreement in connection with the execution, delivery and carrying out of this
Agreement and the other Loan Documents by the Borrower, except as listed on
Schedule
6.1.12,
all of which shall have been obtained or made on or prior to the Closing Date
except as otherwise indicated on Schedule
6.1.12.
|
6.1.13.
|
No Event of Default;
Compliance With Instruments.
|
No event
has occurred and is continuing and no condition exists or will exist after
giving effect to the borrowings or other extensions of credit to be made on the
Closing Date under or pursuant to the Loan Documents which constitutes an Event
of Default or Potential Default. None of the Borrower nor any
Subsidiaries of the Borrower is in violation of (a) any term of its
certificate of incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, limited liability company
agreement or other organizational documents or (b) any material agreement
or instrument to which it is a party or by which it or any of its properties may
be subject or bound where such violation could reasonably be expected to result
in a Material Adverse Change.
|
6.1.14.
|
Patents, Trademarks,
Copyrights, Licenses, Etc.
|
The
Borrower and each Subsidiary of the Borrower owns or has the contractual right
to use all the patents, trademarks, service marks, trade names, copyrights,
licenses, registrations, franchises, permits and rights reasonably necessary to
own and operate its properties and to carry on its business as presently
conducted and planned to be conducted by the Borrower or such Subsidiary,
without known possible, alleged or actual conflict with the rights of others,
except where the failure to do so could not reasonably be expected to have a
Material Adverse Change.
|
6.1.15.
|
Insurance.
|
As of the
Closing Date, no notice has been given or claim made and no grounds exist to
cancel or avoid any of the Borrower's insurance policies or bonds or to reduce
the coverage provided thereby, and such policies and bonds provide adequate
coverage from reputable and financially sound insurers in amounts sufficient to
insure the assets and risks of the Borrower and each Subsidiary of the Borrower
in accordance with prudent business practice in the industry of the Borrower and
its Subsidiaries.
|
6.1.16.
|
Compliance With
Laws.
|
The
Borrower and its Subsidiaries are in compliance in all material respects with
all applicable Laws (other than Environmental Laws which are specifically
addressed in Section 6.1.21
[Environmental Matters]) in all jurisdictions in which the Borrower or any
Subsidiary of the Borrower is presently or will be doing business except where
the failure to do so could not reasonably be expected to result in a Material
Adverse Change.
|
6.1.17.
|
Material Contracts;
Burdensome Restrictions.
|
All
material contracts relating to the business operations of the Borrower and each
Subsidiary of the Borrower, including all employee benefit plans and Labor
Contracts are valid, binding and enforceable upon the Borrower or such
Subsidiary and, to the best of the Borrower's knowledge, each of the other
parties thereto in accordance with their respective terms. To the Borrower's
knowledge, there is no default with respect to parties other than the Borrower
or such Subsidiary under any contract which, when combined with all then
existing defaults under all other contracts, could reasonably be expected to
result in a Material Adverse Change. None of the Borrower or its Subsidiaries is
bound by any contractual obligation, or subject to any restriction in any
organization document, or any requirement of Law which could reasonably be
expected to result in a Material Adverse Change.
|
6.1.18.
|
Investment Companies;
Regulated Entities.
|
Neither
the Borrower nor any Subsidiaries of the Borrower is an "investment company"
registered or required to be registered under the Investment Company Act of 1940
or under the "control" of an "investment company" as such terms are defined in
the Investment Company Act of 1940 and shall not become such an "investment
company" or under such "control." Neither the Borrower nor any
Subsidiaries of the Borrower is a "holding company" or an "affiliate" of a
"holding company" or of a "subsidiary company" of a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as
amended. Neither the Borrower nor any Subsidiaries of the Borrower is
subject to any other federal or state statute or regulation limiting its ability
to incur Indebtedness for borrowed money.
|
6.1.19.
|
Plans and Benefit
Arrangements.
|
(a) The
Borrower and each other member of the ERISA Group are in compliance with any
applicable provisions of ERISA with respect to all Benefit Arrangements, Plans,
Multiple Employer Plans and Multiemployer Plans except where any instance of
noncompliance could not reasonably be expected to result in a Material Adverse
Change. There has been no Prohibited Transaction with respect to any
Benefit Arrangement or any Plan or, to the best knowledge of the Borrower, with
respect to any Multiemployer Plan or Multiple Employer Plan, which could
reasonably be expected to result in a Material Adverse Change. The
Borrower and all other members of the ERISA Group have made when due any and all
material payments required to be made under any agreement relating to a
Multiemployer Plan or a Multiple Employer Plan or any Law pertaining
thereto. With respect to each Plan and Multiple Employer Plan, the
Borrower and each other member of the ERISA Group (i) have fulfilled in all
material respects their obligations under the minimum funding standards of
ERISA, (ii) have not incurred any material liability to the PBGC which has
not been paid in the ordinary course, and (iii) have not had asserted
against them any penalty for failure to fulfill the minimum funding requirements
of ERISA. All Plans, Benefit Arrangements and, to the best knowledge
of Borrower, Multiple Employer Plans and Multiemployer Plans have been
administered in all material respects in accordance with their terms and
applicable Law.
(b) No
event requiring notice to the PBGC under Section 303(k)(4)(A) of ERISA has
occurred or is reasonably expected to occur with respect to any
Plan.
(c) Neither
the Borrower nor any other member of the ERISA Group has incurred or reasonably
expects to incur any withdrawal liability under ERISA to any Multiemployer Plan
or Multiple Employer Plan which could reasonably be expected to result in a
Material Adverse Change. Neither the Borrower nor any other member of
the ERISA Group has been notified by any Multiemployer Plan or Multiple Employer
Plan that such Multiemployer Plan or Multiple Employer Plan has been terminated
within the meaning of Title IV of ERISA and, to the best knowledge of the
Borrower, no Multiemployer Plan or Multiple Employer Plan is reasonably expected
to be reorganized or terminated, within the meaning of Title IV of
ERISA.
|
6.1.20.
|
Employment
Matters.
|
The
Borrower and each Subsidiary of the Borrower is in compliance with the Labor
Contracts and all applicable federal, state and local labor and employment Laws
including those related to equal employment opportunity and affirmative action,
labor relations, minimum wage, overtime, child labor, medical insurance
continuation, worker adjustment and relocation notices, immigration controls and
worker and unemployment compensation, where the failure to comply could
reasonably be expected to result in a Material Adverse Change. There
are no outstanding grievances, arbitration awards or appeals therefrom arising
out of the Labor Contracts or current or threatened strikes, picketing,
handbilling or other work stoppages or slowdowns at facilities of the Borrower
or any Subsidiary of the Borrower which in any case could reasonably be expected
to result in a Material Adverse Change. The Borrower has delivered to
the Agent true and correct copies of each of the Labor Contracts.
|
6.1.21.
|
Environmental
Matters.
|
None of
the Borrower or any Subsidiary of the Borrower has received any Environmental
Complaint and the Borrower does not have any reason to believe that such an
Environmental Complaint might be received, which individually or in the
aggregate could reasonably be expected to result in a Material Adverse
Change. There are no pending or, to the Borrower's knowledge,
threatened Environmental Complaints relating to the Borrower or any Subsidiary
of the Borrower, or any of the Properties or, to the Borrower's knowledge, any
prior owner, operator or occupant of any of the Properties pertaining to, or
arising out of, any Contamination or violations of Environmental Laws or
Environmental Permits which, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Change. The Borrower and
its Subsidiaries are in compliance with all applicable Environmental Laws in all
jurisdictions in which the Borrower or any of its Subsidiaries is doing business
except where the failure to do so could not reasonably be expected to result in
a Material Adverse Change. The Borrower holds and its Subsidiaries
hold and are operating in compliance with Environmental Permits, except where
the failure to do so could not reasonably be expected to result in a Material
Adverse Change.
|
6.1.22.
|
Senior Debt
Status.
|
The
Obligations of the Borrower under this Agreement and each of the other Loan
Documents to which it is a party do rank and will rank at least pari passu in priority of
payment with all other Indebtedness of the Borrower, except Indebtedness of the
Borrower to the extent secured by Permitted Liens. There is no Lien
upon or with respect to any of the properties or income of the Borrower or any
Subsidiary of the Borrower which secures indebtedness or other obligations of
any Person except for Permitted Liens.
|
6.1.23.
|
Hedging Contract
Policies.
|
Schedule
6.1.23 is a true and correct copy of Hedging Contract
Policies. The Borrower and each Subsidiary of the Borrower is subject
to and is in compliance with the Hedging Contract Policies and the Borrower
shall, and shall cause each of its Subsidiaries which engages in any Hedging
Transaction to continue to comply with the Hedging Contract Policies, to the
extent that the failure to comply, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Change.
|
6.1.24.
|
Permitted Related
Business Opportunities.
|
The
information set forth on Schedule
6.1.24 is true, complete and correct in all material respects and sets
forth a list of all of the Investments in Permitted Related Business
Opportunities of the Borrower and its Subsidiaries as of the Closing Date and
includes, without limitation, the amount and nature of each such Investment, a
description of the activities engaged in by the Borrower and its Subsidiaries in
connection with such Investment, and a description of the activities engaged in
by the Person in which the Investment has been made.
|
6.1.25.
|
Anti-Terrorism
Laws;
Executive Order No. 13224.
|
Neither
the Borrower nor any Subsidiary of the Borrower is any of the following (each a
"Blocked
Person"):
(a) a
Person that is listed in the annex to, or is otherwise subject to the provisions
of, the Executive Order No. 13224;
(b) a
Person owned or controlled by, or acting for or on behalf of, any Person that is
listed in the annex to, or is otherwise subject to the provisions of, the
Executive Order No. 13224;
(c) a
Person or entity with which any Lender is prohibited from dealing or otherwise
engaging in any transaction by any Anti-Terrorism Law;
(d) a
Person or entity that commits, threatens or conspires to commit or supports
"terrorism" as defined in the Executive Order No. 13224;
(e) a
Person or entity that is named as a "specially designated national" on the most
current list published by the United States Treasury Department Office of
Foreign Asset Control at its official website or any replacement website or
other replacement official publication of such list, or
(f) a
Person or entity who is affiliated or associated with a Person or entity listed
above.
6.2 Continuation of
Representations.
The
Borrower makes the representations and warranties in this Section 6
on the date hereof, on the Closing Date, and each date thereafter on which a
Loan is made or a Letter of Credit is issued as provided in and subject to Sections
7.1
[First Loans and Letters of Credit] and 7.2
[Each Additional Loan or Letter of Credit].
7. CONDITIONS OF
LENDING AND
ISSUANCE OF LETTERS OF CREDIT
The
obligation of each Lender to make Loans and of the Issuing Lender to issue
Letters of Credit hereunder is subject to the performance by the Borrower of its
Obligations to be performed hereunder at or prior to the making of any such
Loans or issuance of such Letters of Credit and to the satisfaction of the
following further conditions:
7.1 First Loans and Letters of
Credit.
On the
Closing Date:
|
7.1.1.
|
Officer's
Certificate.
|
The
representations and warranties of the Borrower contained in Section 6
[Representations and Warranties] and in each of the other Loan Documents shall
be true and accurate on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of such date
(except representations and warranties which relate solely to an earlier date or
time, which representations and warranties shall be true and correct on and as
of the specific dates or times referred to therein), and the Borrower shall have
performed and complied with all covenants and conditions hereof and thereof
required to have been performed and complied with on or prior to the Closing
Date, no Event of Default or Potential Default shall have occurred and be
continuing or shall exist; and there shall be delivered to the Agent for the
benefit of each Lender a certificate of the Borrower, dated the Closing Date and
signed by the Chief Executive Officer, President, Chief Financial Officer or
other Authorized Officer of the Borrower, to each such effect.
|
7.1.2.
|
Secretary's
Certificate.
|
There
shall be delivered to the Agent for the benefit of each Lender a certificate
dated the Closing Date and signed by the Secretary or an Assistant Secretary of
the Borrower, certifying as appropriate as to:
(a) all
action taken by the Borrower in connection with this Agreement and the other
Loan Documents;
(b) the
names of the officer or officers authorized to sign this Agreement and the other
Loan Documents and the true signatures of such officer or officers and
specifying the Authorized Officers permitted to act on behalf of the Borrower
for purposes of this Agreement and the true signatures of such officers, on
which the Agent and each Lender may conclusively rely; and
(c) copies
of its organizational documents, including its certificate of incorporation,
bylaws, certificate of limited partnership, partnership agreement, certificate
of formation, and limited liability company agreement as in effect on the
Closing Date certified by the appropriate state official where such documents
are filed in a state office together with certificates from the appropriate
state officials as to the continued existence and good standing of the Borrower
in each state where organized or qualified to do business and a bring-down
certificate by facsimile dated the Closing Date.
|
7.1.3.
|
Opinion of
Counsel.
|
There
shall be delivered to the Agent for the benefit of each Lender a written opinion
of (a) Troutman Sanders LLP, counsel for the Borrower (who may rely on the
opinions of such other counsel and Certificates of the Borrower's in-house
counsel as may be reasonably acceptable to the Agent), dated the Closing Date
and in substantially the form attached hereto as Exhibit 7.1.3
(A), and (b) Richard Reich, in-house counsel for NJR Service
Corporation, dated the Closing Date and in substantially the form attached
hereto as Exhibit 7.1.3
(B).
|
7.1.4.
|
Legal
Details.
|
All legal
details and proceedings in connection with the transactions contemplated by this
Agreement and the other Loan Documents shall be in form and substance
satisfactory to the Agent and counsel for the Agent, and the Agent shall have
received all such other counterpart originals or certified or other copies of
such documents and proceedings in connection with such transactions, in form and
substance satisfactory to the Agent and said counsel, as the Agent or said
counsel may reasonably request. The Agent shall have received this
Agreement executed by the Borrower and each Lender.
|
7.1.5.
|
Payment of
Fees.
|
The
Borrower shall have paid or caused to be paid to the Agent for itself and for
the account of the Lenders to the extent not previously paid all fees accrued
through the Closing Date and the costs and expenses for which the Agent and the
Lenders are entitled to be reimbursed.
|
7.1.6.
|
Consents.
|
The
material consents, if any, required to effectuate the transactions contemplated
hereby as set forth on Schedule
6.1.12
shall have been obtained.
|
7.1.7.
|
Officer's Certificate
Regarding MACs.
|
Since
September 30, 2009, no Material Adverse Change shall have occurred; prior
to the Closing Date, there shall have been no material change in the management
of the Borrower; and there shall have been delivered to the Agent for the
benefit of each Lender a certificate dated the Closing Date and signed by the
Chief Executive Officer, President, Chief Financial Officer or other Authorized
Officer of the Borrower to each such effect.
|
7.1.8.
|
No Violation of
Laws.
|
The
making of the Loans and the issuance of the Letters of Credit shall not
contravene any Law applicable to the Borrower or any of the
Lenders.
|
7.1.9.
|
No Actions or
Proceedings.
|
No
action, proceeding, investigation, regulation or legislation shall have been
instituted, threatened or proposed before any court, governmental agency or
legislative body to enjoin, restrain or prohibit, or to obtain damages in
respect of, this Agreement, the other Loan Documents or the
consummation of the transactions contemplated hereby or thereby or which, in the
Agent's sole discretion, would make it inadvisable to consummate the
transactions contemplated by this Agreement or any of the other Loan
Documents.
|
7.1.10.
|
Hedging Contract
Policies.
|
The
Borrower shall have delivered to the Agent and each Lender a true and complete
copy of the Hedging Contract Policies, and the Hedging Contract Policies shall
be satisfactory in form and substance to each Lender.
|
7.1.11.
|
Termination of
Commitments and Repayment of Outstanding
Indebtedness.
|
The
Borrower shall have repaid all obligations, indebtedness, interest fees,
expenses and other amounts due and owing under the Existing Agreement, all
commitments to lend thereunder shall have been irrevocably terminated and all
letters of credit issued thereunder shall have been terminated (except for the
Existing Letters of Credit).
7.2 Each Additional Loan or
Letter of Credit.
At the
time of making any Loans or issuing any Letters of Credit other than Loans made
or Letters of Credit issued on the Closing Date and after giving effect to the
proposed extensions of credit: (a) the representations and warranties of
the Borrower contained in
Section
6 [Representations and Warranties] (other than the representations and
warranties contained in the first sentence of Section
6.1.6 [Litigation], the last sentence of Section
6.1.8(b) [Financial Statements], and Section
6.1.21 [Environmental Matters]) and in the other Loan Documents shall be
true on and as of the date of such additional Loan or Letter of Credit with the
same effect as though such representations and warranties had been made on and
as of such date (except representations and warranties which expressly relate
solely to an earlier date or time, which representations and warranties shall be
true and correct on and as of the specific dates or times referred to therein),
and the Borrower shall have performed and complied with all covenants and
conditions hereof; (b) no Event of Default or Potential Default shall have
occurred and be continuing or shall exist; (c) the making of the Loans or
issuance of such Letters of Credit shall not contravene any Law applicable to
the Borrower or any Subsidiary of the Borrower or any of the Lenders; and (d)
the Borrower shall have delivered to the Agent a duly executed and completed
Loan Request, Swing Loan Request, or application for a Letter of Credit as the
case may be.
8. COVENANTS
8.1 Affirmative
Covenants.
The
Borrower covenants and agrees that until payment in full of the Loans,
Reimbursement Obligations and Letter of Credit Borrowings, and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Borrower's other Obligations under the Loan Documents and termination of the
Commitments, the Borrower shall comply at all times with the following
affirmative covenants:
|
8.1.1.
|
Preservation of
Existence, Etc.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, maintain its legal
existence as a corporation, limited partnership or limited liability company and
its license or qualification and good standing in each jurisdiction in which its
ownership or lease of property or the nature of its business makes such license
or qualification necessary, except (a) where the lack of legal existence of
any Subsidiary or the failure to be so licensed or qualified could not
reasonably be expected to have a Material Adverse Change, or (b) as
otherwise expressly permitted in Section 8.2.5
[Liquidations, Mergers, Etc.].
|
8.1.2.
|
Payment of
Liabilities, Including Taxes,
Etc.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, (a) file all
federal, state, local and other tax returns required to be filed in a timely
manner, and (b) duly pay and discharge all liabilities to which it is subject or
which are asserted against it, promptly as and when the same shall become due
and payable, including all taxes, assessments and
governmental charges upon it or any of its properties, assets, income or
profits, prior to the date on which penalties attach thereto, except to the
extent that such liabilities, including taxes, assessments or charges, are being
contested in good faith and by appropriate and lawful proceedings diligently
conducted and for which such reserve or other appropriate provisions, if any, as
shall be required by GAAP shall have been made, but only to the extent that
failure to discharge any such liabilities would not result in any additional
liability which could reasonably be expected to result in a Material Adverse
Change.
|
8.1.3.
|
Maintenance of
Insurance.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, insure its
properties and assets in amounts sufficient to insure the assets and risks of
the Borrower and each of its Subsidiaries in accordance with prudent business
practice in the industry of the Borrower and such Subsidiaries, and in any event
against loss or damage by fire and such other insurable hazards as such assets
are commonly insured (including fire, extended coverage, property damage,
workers' compensation, public liability and business interruption insurance) and
against other risks (including errors and omissions) in such amounts as similar
properties and assets are insured by prudent companies in similar circumstances
carrying on similar businesses, and with reputable and financially sound
insurers, including self-insurance to the extent customary. The Borrower shall
not permit to exist any grounds for any such insurer to cancel or avoid, or
reduce the amount of, any such coverage.
|
8.1.4.
|
Maintenance of
Properties and Leases.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, maintain in good
repair, working order and condition (ordinary wear and tear excepted) in
accordance with the general practice of other businesses of similar character
and size, all of those properties useful or necessary to its business, and from
time to time, the Borrower will make or cause to be made all appropriate
repairs, renewals or replacements thereof.
|
8.1.5.
|
Maintenance of
Patents, Trademarks, Etc.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, maintain in full
force and effect all patents, trademarks, service marks, trade names,
copyrights, licenses, franchises, permits and other authorizations necessary for
the ownership and operation of its properties and business if the failure so to
maintain the same could constitute a Material Adverse Change.
|
8.1.6.
|
Visitation
Rights.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, permit any of the
officers or authorized employees or representatives of the Agent or any of the
Lenders to visit and inspect any of its properties and to examine and make
excerpts from its books and records and discuss its business affairs, finances
and accounts with its officers, all in such detail and at such times and as
often as any of the Lenders may reasonably request, provided that each
Lender shall provide the Borrower and the Agent with reasonable notice prior to
any visit or inspection, and, except after the occurrence and during the
continuance of an Event of Default, any such visit or inspection shall occur
during regular business hours. In the event any Lender desires to
conduct an audit of the Borrower and/or any one or more of its Subsidiaries,
such Lender shall make a reasonable effort to conduct such audit
contemporaneously with any audit to be performed by the Agent, and except after
the occurrence and during the continuance of an Event of Default, any such audit
(whether by the Agent or any Lender) shall be at the sole cost and expense of
the Agent or such Lender, as the case may be.
|
8.1.7.
|
Keeping of Records and
Books of Account.
|
The
Borrower shall, and shall cause each Subsidiary of the Borrower to, maintain and
keep proper books of record and account which enable the Borrower and its
Subsidiaries to issue financial statements in accordance with GAAP and as
otherwise required by applicable Laws of any Official Body having jurisdiction
over the Borrower or any Subsidiary of the Borrower, and in which full, true and
correct entries shall be made in all material respects of all its dealings and
business and financial affairs.
|
8.1.8.
|
Plans and Benefit
Arrangements.
|
The
Borrower shall, and shall cause each of its Subsidiaries and each other member
of the ERISA Group to, comply with ERISA, the Internal Revenue Code and other
applicable Laws applicable to Plans and Benefit Arrangements except where such
failure, alone or in conjunction with any other failure, would not reasonably be
expected to result in a Material Adverse Change. Without limiting the
generality of the foregoing, the Borrower shall cause all of its Plans and all
Plans maintained by any of its Subsidiaries and any member of the ERISA Group to
be funded in accordance with the minimum funding requirements of ERISA and shall
make, and cause each member of the ERISA Group to make, in a timely manner, all
contributions due to Plans, Benefit Arrangements and Multiemployer
Plans.
|
8.1.9.
|
Compliance With
Laws.
|
The
Borrower shall, and shall cause each of its Subsidiaries to, comply with all
applicable Laws, including all Environmental Laws, in all material respects,
provided that it shall not be
deemed to be a violation of this Section 8.1.9
if any failure to comply with any Law would not result in fines, penalties,
costs associated with the performance of any Remedial Actions, other similar
liabilities or injunctive relief which in the aggregate could not reasonably be
expected to result in a Material Adverse Change. Without limiting the
generality of the foregoing, the Borrower shall, and shall cause each of its
Subsidiaries to, obtain, maintain, renew and comply with all Environmental
Permits applicable to their respective operations and activities, provided that
it shall not be deemed to be a violation of this Section 8.1.9
if any failure to do so would not result in cease and desist orders or fines,
penalties or other similar liabilities or injunctive relief which in the
aggregate could not reasonably be expected to result in a Material Adverse
Change.
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8.1.10.
|
Use of
Proceeds.
|
The
Borrower will use the Letters of Credit and the proceeds of the Loans only for
general corporate purposes of the Borrower and for working capital of the
Borrower (including, without limitation (a) the use of Letters of Credit to
support obligations arising in the ordinary course of the business of the
Borrower, as such business is permitted to be conducted pursuant to Section
8.2.9 [Continuation of or Change in Business] (b) to support
the issuance by the Borrower of short term notes in the commercial paper market
and (c) to repay and terminate Indebtedness outstanding under the Existing
Agreement). The Borrower shall not use the Letters of Credit or the
proceeds of the Loans for any purposes which contravenes any applicable Law or
any provision hereof.
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8.1.11.
|
Hedging Contract
Policies.
|
The
Borrower and each Subsidiary of the Borrower shall comply with the Hedging
Contract Policies if the failures to comply, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse
Change.
8.2 Negative
Covenants.
The
Borrower covenants and agrees that until payment in full of the Loans,
Reimbursement Obligations and Letter of Credit Borrowings, and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Borrower's other Obligations hereunder and termination of the Commitments, the
Borrower shall comply with the following negative covenants:
|
8.2.1.
|
Indebtedness.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, at any time
create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness
under the Loan Documents;
(b) Existing
Indebtedness as set forth on Schedule
8.2.1
(including any extensions or renewals thereof, provided there is no
increase in the amount thereof or other significant change in the terms thereof
unless otherwise specified on Schedule
8.2.1);
(c) Additional
Indebtedness issued by the Borrower in accordance with Article Two of the
Mortgage Indenture (as the Mortgage Indenture is in effect on the Closing Date),
provided that such additional
Indebtedness shall not contain (i) covenants, defaults and other terms and
conditions more restrictive than those contained in this Agreement or (ii) any
negative covenants, financial covenants, or defaults that are not also contained
in this Agreement (provided however that if the
Borrower's Debt Rating by Standard & Poor's is A- or better and by Moody's
is A3 or better (or is equal or better than the equivalent rating of Fitch, Inc.
or another nationally recognized statistical rating agency who shall have
replaced either Standard & Poor's or Moody's as contemplated by the
definition of the term "Debt Rating" hereunder), such Indebtedness may contain
provisions described in clauses (i) and/or (ii) if the Borrower at such time in
writing irrevocably offers the Agent and the Lenders to enter at any time into
an amendment of this Agreement to add to this Agreement similar covenants,
provisions or Events of Default, as the case may be), and shall specifically and
expressly not contain any covenant or agreement with respect to the issuance or
payment of dividends more restrictive than the restrictions contained in Section
4.1 of the Twenty-Sixth Supplemental Indenture dated as of October 1, 1995,
supplemental to the Mortgage Indenture;
(d) Additional,
unsecured Indebtedness of the Borrower (including, without limitation, the NJNG
Notes) incurred after the Closing Date, not to exceed at any time outstanding,
after giving effect thereto, 65% of Consolidated Total Capitalization, so long
as, both before and after giving effect to any proposed additional
Indebtedness: (i) no Default or Event of Default shall have occurred
and be continuing and (ii) provided that such additional Indebtedness shall not
contain (A) covenants, defaults and other terms or conditions more restrictive
than those contained in this Agreement or (B) any negative covenants, financial
covenants, or defaults that are not also contained in this Agreement, provided, however that if the
Borrower's Debt Rating by Standard & Poor's is A- or better and by Moody's
is A3 or better (or is equal or better than the equivalent rating of Fitch, Inc.
or another nationally recognized statistical rating agency who shall have
replaced either Standard & Poor's or Moody's as contemplated by the
definition of the term "Debt Rating" hereunder), such Indebtedness may contain
provisions described in clauses (A) and/or (B) if the Borrower at such time in
writing irrevocably offers the Agent and the Lenders to enter at any time into
an amendment of this Agreement to add to this Agreement similar covenants,
provisions or Events of Default, as the case may be, and provided further, that with
respect to the NJNG Notes and any refinancing thereof, in addition, any
Indebtedness refinancing the NJNG Notes shall: (1) be unsecured, (2) have a
maturity date no earlier than 180 days after the Expiration Date, and (3) have
an interest rate not materially in excess of prevailing rates at such time for
like transactions with a borrower of comparable credit rating to the
Borrower;
(e) Additional
Indebtedness, in respect of capitalized leases (including, without limitation,
capitalized leases for metered assets) not to exceed at any time outstanding in
the aggregate for the Borrower and its Subsidiaries,
$60,000,000.00;
(f) Additional
Indebtedness of the Borrower arising under any Hedging Transaction;
(g) Additional
Indebtedness, at any time outstanding not to exceed $10,000,000.00, secured by
Liens permitted by Section
8.2.2(a);
(h) Additional
Indebtedness not to exceed at any time outstanding in the aggregate for the
Borrower and its Subsidiaries $75,000,000.00, so long as: (i) such Indebtedness
is Indebtedness of an Acquired Person which existed prior to the consummation of
the Permitted Acquisition in connection with which such Acquired Person was
acquired by a Loan Party and such Indebtedness was not incurred in contemplation
of or in connection with such Permitted Acquisition; and (ii) such Indebtedness
if secured is secured by Liens permitted by clause (l) of the definition of
Permitted Liens;
(i) Indebtedness,
secured by Purchase Money Security Interests as permitted by clause (k) of the
definition of Permitted Liens, not to exceed at any time outstanding in the
aggregate for the Borrower and its Subsidiaries $20,000,000.00; and
(j) Gas
meter sale and leaseback transactions under the Permitted Sale and Leaseback
Program.
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8.2.2.
|
Liens.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, at any time
create, incur, assume or suffer to exist any Lien on any of its property or
assets, tangible or intangible, now owned or hereafter acquired, or agree or
become liable to do so, except:
(a) Liens
existing on such property at the time of the acquisition of such property;
provided that the fair market value of all assets secured as permitted by this
Section
8.2.2 clause (a) shall not exceed, at any time, $10,000,000.00 and provided further that
the Indebtedness secured by Liens permitted by this Section
8.2.2 clause (a) shall not at any time outstanding exceed
$10,000,000.00;
(b) Permitted
Liens; and
(c) Extensions
or renewals of any Lien described in clause (a) or (b) of this Section
8.2.2, provided
that: (i) any such extension or renewal shall be limited to the property
theretofore subject to such Lien, and (ii) the principal amount of the
Indebtedness secured by such Lien shall not be increased and shall otherwise be
permitted by Section
8.2.1 [Indebtedness].
|
8.2.3.
|
Guaranties.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, at any
time, directly or indirectly, become or be liable in respect of any Guaranty, or
assume, guarantee, become surety for, endorse or otherwise agree, become or
remain directly or contingently liable upon or with respect to any obligation or
liability of any other Person, except for
(a) Guaranties
of any Subsidiary of the Borrower of obligations of the Borrower arising under
any Hedging Transaction;
(b) Guaranties
by the Borrower of various obligations of any of its Subsidiaries in connection
with any transaction arising in connection with its ordinary course of business
as conducted on the Closing Date or as otherwise permitted to be conducted
pursuant to Section
8.2.9 [Continuation of or Change in Business]; and
(c) Guaranties
of the Borrower or any Subsidiary of the Borrower of Indebtedness permitted by
clause (h) of Section
8.2.1 [Indebtedness].
|
8.2.4.
|
Loans and
Investments.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, at any time
make or suffer to remain outstanding any loan or advance to, or purchase,
acquire or own any stock, bonds, notes or securities of, or any partnership
interest (whether general or limited) or limited liability company interest in,
or any other investment or interest in, or make any capital
contribution to, any other Person, or agree, become or remain liable to do any
of the foregoing (any of the foregoing being an "Investment"),
except:
(a) trade
credit extended on usual and customary terms in the ordinary course of
business;
(b) advances
to employees to meet expenses incurred by such employees in the ordinary course
of business;
(c) Investments
in New Jersey Natural Gas Charity, Inc.;
(d) Permitted
Investments; and
(e) any
Investment which constitutes a Permitted Acquisition in accordance with Section
8.2.5 [Liquidations, Mergers, Consolidations, Acquisitions].
|
8.2.5.
|
Liquidations, Mergers,
Consolidations,
Acquisitions.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, dissolve,
liquidate or wind-up its affairs, or become a party to any merger or
consolidation, or acquire by purchase, lease or otherwise all or substantially
all of the assets or capital stock of any other Person, provided that:
(a) any
such Subsidiary may consolidate or merge into another such Subsidiary which is
wholly owned by the Borrower or one or more of such other
Subsidiaries,
(b) any
Inactive Subsidiary of the Borrower may dissolve, liquidate or wind-up its
affairs or any Inactive Subsidiary of the Borrower may consolidate or merge
into: (i) any other Inactive Subsidiary of the Borrower, or (ii) any
other Subsidiary of the Borrower which is not an Inactive Subsidiary so long as
such Inactive Subsidiary has no liabilities, contingent or otherwise, other than
Indebtedness permitted by Section
8.2.1 [Indebtedness], and
(c) the
Borrower may acquire, whether by purchase or by merger, (i) all of the
ownership interests of another Person or (ii) substantially all of assets
of another Person or of a business or division of another Person (each a "Permitted
Acquisition"), provided that each of
the following requirements is met:
(A) the
board of directors or other equivalent governing body of such Person shall have
approved such Permitted Acquisition and, if the Borrower shall use any portion
of the Loans to fund such Permitted Acquisition, the Borrower also shall have
delivered to the Lenders written evidence of the approval of the board of
directors (or equivalent body) of such Person for such Permitted
Acquisition;
(B) the
business acquired, or the business conducted by the Person whose ownership
interests are being acquired, as applicable, shall be substantially the same as
one or more line or lines of business conducted by the Borrower or otherwise be
compliant with Section 8.2.9
[Continuation of or Change in Business];
(C) no
Potential Default or Event of Default shall exist immediately prior to and after
giving effect to such Permitted Acquisition;
(D) the
Borrower shall demonstrate that it shall be in compliance with the covenants
contained in Sections
8.2.12 [Maximum Leverage Ratio] and 8.2.13
[Minimum Interest Coverage Rate] after giving effect to such Permitted
Acquisition (including in such computation Indebtedness or other liabilities
assumed or incurred in connection with such Permitted Acquisition but excluding
income earned or expenses incurred by the Person, business or assets to be
acquired prior to the date of such Permitted Acquisition) by delivering at least
five (5) Business Days prior to such Permitted Acquisition a certificate in the
form of Exhibit 8.2.5
(the "Acquisition
Compliance Certificate") evidencing such compliance; and
(E) the
Borrower shall deliver to the Agent at least five (5) Business Days before such
Permitted Acquisition copies of any agreements entered into or proposed to be
entered into by the Borrower in connection with such Permitted Acquisition and
shall deliver to the Agent such other information about such Person or its
assets as the Agent or any Lender may reasonably require.
|
8.2.6.
|
Dispositions of Assets
or Subsidiaries.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, sell, sell
and leaseback, convey, assign, lease, abandon or otherwise transfer or dispose
of, voluntarily or involuntarily, any of its properties or assets, tangible or
intangible (including sale, assignment, discount or other disposition of
accounts, contract rights, chattel paper, equipment or general intangibles with
or without recourse or of capital stock, shares of beneficial interest,
partnership interests or limited liability company interests of a Subsidiary of
the Borrower), except:
(a) transactions
involving the sale of inventory in the ordinary course of business;
(b) any
sale, transfer or lease of assets in the ordinary course of business which are
no longer necessary or required in the conduct of the Borrower's or such
Subsidiary's business;
(c) any
sale, transfer or lease of assets by any wholly owned Subsidiary of the Borrower
to the Borrower;
(d) any
sale, transfer or lease of assets in the ordinary course of business which are
replaced by substitute assets acquired or leased;
(e) any
sale, transfer or lease of assets, other than those specifically excepted
pursuant to clauses (a) through (d) above, provided that (i) at the time of
any disposition, no Event of Default shall exist or shall result from such
disposition, and (ii) the aggregate net book value of all assets so sold by
the Borrower and its Subsidiaries shall not exceed in any fiscal year five (5%)
of the consolidated total assets of the Borrower and its Subsidiaries as
determined on a consolidated basis in accordance with GAAP;
(f) any
sale, transfer or lease of assets of any Inactive Subsidiary of the Borrower;
and
(g) gas
meter sale and leaseback transactions under the Permitted Sale and Leaseback
Program.
|
8.2.7.
|
Affiliate
Transactions.
|
Except
solely with respect to any Permitted Related Business Opportunities as
previously disclosed to the Agent and each of the Lenders, the Borrower shall
not, and shall not permit any of its Subsidiaries to, enter into or carry out
any transaction (including purchasing property or services from or selling
property or services to any Affiliate of the Borrower or any of its Subsidiaries
or other Person) unless such transaction is not otherwise prohibited by this
Agreement, is entered into in the ordinary course of business upon fair and
reasonable arm's-length terms and conditions and is in accordance with all
applicable Law.
|
8.2.8.
|
Subsidiaries,
Partnerships and Joint
Ventures.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, own,
acquire or create directly or indirectly any Subsidiaries (other than New Jersey
Resources Charity, Inc., a non-profit corporation organized under the laws of
the State of New Jersey) without the prior written consent of the Required
Lenders. The Borrower shall not, and shall not permit any of its
Subsidiaries to, become or agree to (a) become a general or limited partner
in any general or limited partnership, except that the Subsidiaries of the
Borrower may be general or limited partners in other Subsidiaries of the
Borrower and except that Subsidiaries may be a limited partner in a Permitted
Related Business Opportunity, (b) become a member or manager of, or hold a
limited liability company interest in, a limited liability company, except that
Subsidiaries of the Borrower may be members or managers of, or hold limited
liability company interests in, other Subsidiaries of the Borrower and except
that Subsidiaries of the Borrower may be members or managers of, or hold limited
liability company interests in a Permitted Related Business Opportunity, or
(c) become a joint venturer or hold a joint venture interest in any joint
venture except that Subsidiaries of the Borrower may become a joint venturer in
or hold a joint venture interest in any joint venture that is a Permitted
Related Business Opportunity.
|
8.2.9.
|
Continuation of or
Change in Business.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, engage in
any business other than the business of the Borrower or such Subsidiary
substantially as conducted and operated by the Borrower or such Subsidiary
during the present fiscal year, and any line of business
or business activity related or complementary to the business of the Borrower
and its Subsidiaries conducted as of the Closing Date, or constituting a
Permitted Related Business Opportunity.
|
8.2.10.
|
Plans and Benefit
Arrangements.
|
The
Borrower shall not, and shall not permit any of its Subsidiaries to, engage in a
Prohibited Transaction with any Plan, Benefit Arrangement, Multiple Employer
Plan or Multiemployer Plan which, alone or in conjunction with any other
circumstances or set of circumstances, would reasonably be expected to result in
a Material Adverse Change.
|
8.2.11.
|
Fiscal
Year.
|
The
Borrower shall not, and shall not permit any Subsidiary of the Borrower to,
change its fiscal year from the twelve-month period beginning October 1 and
ending September 30.
|
8.2.12.
|
Maximum Leverage
Ratio.
|
The
Borrower shall not at any time permit the ratio of Consolidated Total
Indebtedness of the Borrower and its Subsidiaries to Consolidated Total
Capitalization to exceed 0.65 to 1.00.
|
8.2.13.
|
Minimum Interest
Coverage Ratio.
|
The
Borrower shall not permit the ratio of Consolidated Income from Operations to
Consolidated Interest Expense of the Borrower and its Subsidiaries, calculated
as of the end of each fiscal quarter for the four fiscal quarters then ended, to
be less than 2.50 to 1.00.
|
8.2.14.
|
No Limitation on
Dividends and Distributions by Borrower or its
Subsidiaries.
|
The
Borrower shall not, and shall not permit any Subsidiary of the Borrower to,
enter into or otherwise be bound by any agreement not to pay dividends or make
distributions to the Borrower (in the case of any such Subsidiary) or to the
Parent (in the case of the Borrower), except for the restrictions that are no
more onerous than the restrictions set forth in this Agreement and the
restrictions set forth in the Mortgage Indenture, in each case as such
restrictions exist as of the Closing Date.
|
8.2.15.
|
Payment of Dividends;
Redemptions.
|
The
Borrower shall not, and shall not permit any Subsidiary to, declare or make any
dividend payment or other distribution of assets, properties, cash, rights,
obligations or securities on account of any shares of any class of capital stock
of the Borrower, or purchase, redeem or otherwise acquire for value (or permit
any of its Subsidiaries to do so) any shares of any class of capital stock or
other securities of the Borrower or any warrants, rights or options to acquire
any such shares or other securities, now or hereafter outstanding, except that
the Borrower may (a) declare and make any dividend payment or other
distribution payable in common stock of the Borrower, (b) purchase, redeem
or otherwise acquire shares of its common stock or warrants, rights or options
to acquire any such shares so long as no Event of Default or Potential Default
shall have occurred and is continuing or would result therefrom, and
(c) declare and make its dividends, so long as, after giving effect
thereto, no Event of Default shall have occurred and is continuing.
|
8.2.16.
|
No Modification of
Hedging Contract Policies.
|
The
Borrower and each Subsidiary of the Borrower shall not amend, modify,
supplement, restate or rescind the Hedging Contract Policies in a manner which,
compared with past practice of the Borrower and its Subsidiaries, would render
Hedging Transactions entered into pursuant to the Hedging Contract Policies (as
so modified) materially more speculative, without the prior written consent of
the Required Lenders.
|
8.2.17.
|
Off-Balance Sheet
Financing.
|
The
Borrower and each Subsidiary of the Borrower shall not engage in any off-balance
sheet transaction (i.e., the liabilities in respect of which do not appear on
the liability side of the balance sheet, with such balance sheet prepared in
accordance with GAAP) providing the functional equivalent of borrowed money
(including asset securitizations, sale/leasebacks or Synthetic Leases (other
than any sale/leaseback transaction or Synthetic Lease entered into, in either
case, with respect to meter assets and which transaction is otherwise permitted
by this Agreement)) with liabilities in excess, in the aggregate for the
Borrower and its Subsidiaries as of any date of determination, of five (5%) of
the total assets of the Borrower and its Subsidiaries, determined and
consolidated in accordance with GAAP as of the date of
determination. For purposes of this Section
8.2.17 (a) "Synthetic Lease" means any lease transaction under which the
parties intend that (i) the lease will be treated as an "operating lease" by the
lessee pursuant to Statement of Financial Accounting Standards No. 13, as
amended, or appropriate successor thereto, and (ii) the lessee will be entitled
to various tax benefits ordinarily available to owners (as opposed to lessees)
of like property, and (b) the amount of any lease which is not a capital lease
in accordance with GAAP is the aggregate amount of minimum lease payments due
pursuant to such lease for any non-cancelable portion of its term.
|
8.2.18.
|
Amendments to NJNG
Note Agreement.
|
Neither
the Borrower nor any Subsidiary of the Borrower shall enter into any one or more
amendments, modifications, restatements, or the like of the NJNG Note Agreement
containing covenants or events of default materially more restrictive than the
covenants or Events of Default contained in this Agreement (an "NJNG
Modification Agreement") unless no later than five (5) Business Days
after entering into any such NJNG Modification Agreement, Borrower shall have
irrevocably offered the Agent and the Lenders to enter at any time into an
amendment of this Agreement to add hereto substantially similar covenants or
Events of Default, as the case may be. The foregoing shall not be construed
as: (a) a consent by the Agent or any Lender to any action or
inaction otherwise restricted or prohibited by this Agreement, or (b) a waiver
by the Agent or any Lender of any Potential Default or Event of Default
resulting from any NJNG Modification Agreement.
|
8.2.19.
|
No Violation of
Anti-Terrorism Laws.
|
Neither
the Borrower nor any Subsidiary of the Borrower shall: (a) violate
any of the prohibitions set forth in the Executive Order No. 13224, the USA
Patriot Act or any other Anti-Terrorism Law applicable to any of them or the
business that they conduct, or (b) require the Agent or the Lenders to take any
action that would cause the Agent or the Lenders to be in violation of the
prohibitions set forth in the Executive Order No. 13224, the USA Patriot Act or
any other Anti-Terrorism Law, it being understood that the Agent or any Lender
can refuse to honor any such request or demand otherwise validly made by the
Borrower under this Agreement or any other Loan Document.
8.3 Reporting
Requirements.
The
Borrower covenants and agrees that until payment in full of the Loans,
Reimbursement Obligations and Letter of Credit Borrowings, and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Borrower's other Obligations hereunder and under the other Loan Documents and
termination of the Commitments, the Borrower will furnish or cause to be
furnished to the Agent and each of the Lenders:
|
8.3.1.
|
Quarterly Financial
Statements.
|
As soon
as available and in any event within fifty-five (55) calendar days after the end
of each of the first three fiscal quarters in each fiscal year (or such earlier
or later date, from time to time established by the SEC in accordance with the
Securities Exchange Act of 1934, as amended), financial statements of the
Borrower, consisting of a consolidated and consolidating balance sheet as of the
end of such fiscal quarter and related consolidated and consolidating statements
of income, stockholders' equity and cash flows for the fiscal quarter then ended
and the fiscal year through that date, all in reasonable detail and certified
(subject to normal year-end audit adjustments) by the Chief Executive Officer,
President, Chief Financial Officer or Treasurer of the Borrower as having been
prepared in accordance with GAAP, consistently applied, and setting forth in
comparative form the respective financial statements for the corresponding date
and period in the previous fiscal year. The Borrower will be deemed
to have complied with the delivery requirements of this Section
8.3.1 if within fifty-five (55) days after the end of its fiscal quarter
(or such earlier or later date, from time to time established by the SEC in
accordance with the Securities Exchange Act of 1934, as amended), the Borrower
delivers to the Agent and each of the Lenders a copy of its Form 10-Q as filed
with the SEC and the financial statements contained therein meets the
requirements described in this Section.
|
8.3.2.
|
Annual Financial
Statements.
|
As soon
as available and in any event within 105 days after the end of each fiscal year
of the Borrower (or such earlier or later date, from time to time established by
the SEC in accordance with the Securities Exchange Act of 1934, as amended),
financial statements of the Borrower consisting of a consolidated balance sheet
as of the end of such fiscal year, and related consolidated statements of
income, stockholders' equity and cash flows for the fiscal year then ended, all
in reasonable detail and setting forth in comparative form the financial
statements as of the end of and for the preceding fiscal year, and certified by
independent certified public accountants of nationally recognized standing
satisfactory to the Agent. The certificate or report of accountants
shall be free of qualifications (other than any consistency qualification that
may result from a change in the method used to prepare the financial statements
as to which such accountants concur) and shall not indicate the occurrence or
existence of any event, condition or contingency which would materially impair
the prospect of payment or performance of any covenant, agreement or duty of the
Borrower under any of the Loan Documents. The Borrower will be deemed
to have complied with the delivery requirements of this Section
8.3.2 if within 105 days after the end of its fiscal year (or such
earlier or later date, from time to time established by the SEC in accordance
with the Securities Exchange Act of 1934, as amended), the Borrower delivers to
the Agent and each of the Lenders a copy of its Form 10-K as filed with the SEC
and the financial statements and certification of public accountants contained
therein meets the requirements described in this Section.
It is
expressly agreed that any financial information or financial statements
(including, without limitation the annual financial statements required pursuant
to this Section
8.3.2) submitted to the Agent or the Lenders which has been prepared by
an independent public accountant or other outside accountant shall be
accompanied by a statement in writing signed by such accountant disclosing that
the accountant is aware that the financial information or financial statements
prepared by the accountant would be submitted to and relied upon by the Agent
and/or the Lenders in connection with the Agent's or the Lenders' determination
to grant or continue credit. The Agent acknowledges that Deloitte & Touche,
LLP is an independent certified public accountant reasonably satisfactory to the
Agent as of the date hereof.
|
8.3.3.
|
Certificate of the
Borrower.
|
Concurrently
with the financial statements of the Borrower furnished to the Agent and to the
Lenders pursuant to Sections 8.3.1
[Quarterly Financial Statements] and 8.3.2
[Annual Financial Statements], a certificate (each a "Compliance
Certificate") of the Borrower signed by the Chief Executive Officer,
President, Chief Financial Officer or Treasurer of the Borrower, in the form of
Exhibit 8.3.3.
|
8.3.4.
|
Notice of
Default.
|
Promptly
after any Authorized Officer (or other executive officer) of the Borrower has
learned of the occurrence of an Event of Default or Potential Default, a
certificate signed by the Chief Executive Officer, President or Chief Financial
Officer of the Borrower setting forth the details of such Event of Default or
Potential Default and the action which the Borrower proposes to take with
respect thereto.
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8.3.5.
|
Notice of
Litigation.
|
Promptly
after the commencement thereof, notice of (a) all actions, suits,
proceedings or investigations before or by any Official Body or any other Person
against the Borrower or Subsidiary of the Borrower, involve a claim or series of
claims in excess of $10,000,000.00 or, (b) any Environmental Complaint,
individually or in the aggregate exceed $10,000,000.00, and in either case which
if adversely determined could reasonably be expected to result in a Material
Adverse Change.
|
8.3.6.
|
Notice of Change in
Debt Rating.
|
Within
five (5) Business Days after Standard & Poor's or Moody's, or such other
rating agency as may be applicable pursuant to the terms hereof, announces a
change in the Debt Rating of the Borrower, notice of such
change. The Borrower will deliver, together with such notice, a copy
of any written notification which Borrower received from the applicable rating
agency regarding such change of Debt Rating.
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8.3.7.
|
Sale of
Assets.
|
At least
thirty (30) calendar days prior thereto, notice with respect to any proposed
sale or transfer of assets pursuant to Section
8.2.6(e) [Dispositions of Assets or Subsidiaries] where the consideration
for such sale or transfer of assets is in excess of $10,000,000.00.
|
8.3.8.
|
Budgets, Forecasts,
Other Reports and
Information.
|
Promptly
upon their becoming available to the Borrower:
(a) any
reports, notices or proxy statements generally distributed by the Borrower to
its stockholders on a date no later than the date supplied to such
stockholders,
(b) to
the extent not publicly accessible through the SEC's, the Parent's or the
Borrower's respective websites, regular or periodic reports, including Forms
10-K, 10-Q and 8-K, registration statements and prospectuses, filed by the
Borrower or the Parent with the SEC,
(c) to
the extent not previously reported in regular or periodic reports, including
Forms 10-K, 10-Q and 8-K, registration statements and prospectuses, filed by the
Borrower or the Parent with the SEC, the Borrower shall notify the Lenders
promptly of the enactment or adoption of any Law which may result in a Material
Adverse Change,
(d) to
the extent requested by the Agent or any Lender, the annual budget and any
forecasts or projections of the Borrower, and
(e) with
respect to the Hedging Transaction activities of the Borrower and its
Subsidiaries, to the extent not previously reported in regular or periodic
reports, including Forms 10-K, 10-Q and 8-K, registration statements and
prospectuses, filed by the Borrower or the Parent with the SEC, such other
reports and information as any of the Lenders may from time to time reasonably
request.
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8.3.9.
|
Notices Regarding
Plans and Benefit
Arrangements.
|
8.3.9.1 Certain
Events.
Promptly
upon becoming aware of the occurrence thereof, notice (including the nature of
the event and, when known, any action taken or threatened by the Internal
Revenue Service or the PBGC with respect thereto) of:
(a) any
Reportable Event with respect to the Borrower or any other member of the ERISA
Group (unless the obligation to report said Reportable Event to the PBGC has
been waived),
(b) any
Prohibited Transaction which could subject the Borrower or any other member of
the ERISA Group to a civil penalty assessed pursuant to Section 502(i) of
ERISA or a tax imposed by Section 4975 of the Internal Revenue Code in
connection with any Plan, any Benefit Arrangement or any trust created
thereunder, which penalty or tax could reasonably be expected to result in a
Material Adverse Change,
(c) any
assertion of withdrawal liability with respect to any Multiemployer Plan, which
could reasonably be expected to result in a Material Adverse
Change,
(d) any
partial or complete withdrawal from a Multiemployer Plan by the Borrower or any
other member of the ERISA Group under Title IV of ERISA (or assertion thereof),
which could reasonably be expected to result in a Material Adverse
Change,
(e) any
cessation of operations (by the Borrower or any other member of the ERISA Group)
at a facility in the circumstances described in Section 4062(e) of ERISA,
which could reasonably be expected to result in a Material Adverse
Change,
(f) withdrawal
by the Borrower or any other member of the ERISA Group from a Multiple Employer
Plan, which could reasonably be expected to result in a Material Adverse
Change,
(g) a
failure by the Borrower or any other member of the ERISA Group to make a payment
to a Plan required to avoid imposition of a Lien under Section 303(k) of
ERISA,
(h) the
adoption of an amendment to a Plan requiring the provision of security to such
Plan pursuant to Section 307 of ERISA, or
(i) any
change in the actuarial assumptions or funding methods used for any Plan, where
the effect of such change is to materially increase or materially reduce the
unfunded benefit liability or obligation to make periodic contributions, except
for any such change required under applicable law.
8.3.9.2 Notices of Involuntary
Termination and Annual Reports.
Promptly
after receipt thereof, copies of (a) all notices received by the Borrower
or any other member of the ERISA Group of the PBGC's intent to terminate any
Plan administered or maintained by the Borrower or any member of the ERISA
Group, or to have a trustee appointed to administer any such Plan; and
(b) at the request of the Agent or any Lender each annual report (IRS Form
5500 series) and all accompanying schedules, the most recent actuarial reports,
the most recent financial information concerning the financial status of each
Plan administered or maintained by the Borrower or any other member of the ERISA
Group, and schedules showing the amounts contributed to each such Plan by or on
behalf of the Borrower or any other member of the ERISA Group in which any of
their personnel participate or from which such personnel may derive a benefit,
and each Schedule B (Actuarial Information) to the annual report filed by the
Borrower or any other member of the ERISA Group with the Internal Revenue
Service with respect to each such Plan.
8.3.9.3 Notice of Voluntary
Termination.
Promptly
upon the filing thereof, copies of any Form 5310, or any successor or equivalent
form to Form 5310, filed with the PBGC in connection with the termination of any
Plan.
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8.3.10.
|
Other
Information.
|
Such
additional information as may be reasonably requested in writing by the
Agent.
9. DEFAULT
9.1 Events of
Default.
An Event
of Default means the occurrence or existence of any one or more of the following
events or conditions (whatever the reason therefor and whether voluntary,
involuntary or effected by operation of Law):
|
9.1.1.
|
Payments Under Loan
Documents.
|
The
Borrower shall fail to pay (a) any principal of any Loan (including
scheduled installments, mandatory prepayments or the payment due at maturity),
Reimbursement Obligation or Letter of Credit Borrowing when such principal is
due hereunder or (b) any interest on any Loan, Commitment Fee,
Reimbursement Obligation or Letter of Credit Borrowing or any other amount owing
hereunder or under the other Loan Documents within three (3) Business Days after
such interest, fee, or other amount becomes due in accordance with the terms
hereof or thereof;
|
9.1.2.
|
Breach of
Warranty.
|
Any
representation or warranty made at any time by the Borrower herein or in any
other Loan Document, or in any certificate, other instrument or statement
furnished pursuant to the provisions hereof or thereof, shall prove to have been
false or misleading in any material respect as of the time it was made or
furnished;
|
9.1.3.
|
Breach of Negative
Covenants or Visitation
Rights.
|
The
Borrower shall default in the observance or performance of any covenant
contained in Section 8.1.6
[Visitation Rights] or Section 8.2
[Negative Covenants];
|
9.1.4.
|
Breach of Other
Covenants.
|
The
Borrower shall default in the observance or performance of any other covenant,
condition or provision hereof or of any other Loan Document and such default
shall continue unremedied for a period of thirty (30) calendar days after any
Authorized Officer (or other executive officer) of the Borrower becomes aware of
the occurrence thereof (such grace period to be applicable only in the event
such default can be remedied by corrective action of the Borrower as determined
by the Agent in its reasonable discretion);
|
9.1.5.
|
Defaults in Other
Agreements or Indebtedness.
|
(a) A
default or event of default shall occur at any time under the terms of any other
agreement involving borrowed money or the extension of credit or any other
Indebtedness under which the Borrower may be obligated as a borrower or
guarantor in excess of $10,000,000.00 in the aggregate, and such breach, default
or event of default consists of the failure to pay (beyond any period of grace
permitted with respect thereto, whether waived or not) any indebtedness when due
(whether at stated maturity, by acceleration or otherwise) or if such breach or
default permits or causes the acceleration of any indebtedness (whether or not
such right shall have been waived) or the termination of any commitment to lend;
or
(b) A
default or event of default shall occur at any time under the terms of any
agreement involving any off balance sheet transaction (including any asset
securitization, sale/leaseback transaction, or Synthetic Lease) with obligations
in the aggregate thereunder for which the Borrower may be obligated in excess of
$10,000,000.00, and such breach, default or event of default consists of the
failure to pay (beyond any period of grace permitted with respect thereto,
whether waived or not) any obligation when due (whether at stated maturity, by
acceleration or otherwise) or if such breach or default permits or causes the
acceleration of any obligation (whether or not such right shall have been
waived) or the termination of any such agreement;
|
9.1.6.
|
Final Judgments or
Orders.
|
Any final
judgments or orders for the payment of money in excess of $10,000,000.00 in the
aggregate, to the extent not covered by insurance, shall be entered against the
Borrower by a court having jurisdiction in the premises, which judgment is not
discharged, vacated, bonded or stayed pending appeal within a period of thirty
(30) days from the date of entry;
|
9.1.7.
|
Loan Document
Unenforceable.
|
Any of
the Loan Documents shall cease to be legal, valid and binding agreements
enforceable against the party executing the same or such party's successors and
assigns (as permitted under the Loan Documents) in accordance with the
respective terms thereof or shall in any way be terminated (except in accordance
with its terms) or become or be declared ineffective or inoperative or shall in
any way be challenged or contested or cease to give or provide the respective
rights, titles, interests, remedies, powers or privileges intended to be created
thereby;
|
9.1.8.
|
Uninsured Losses;
Proceedings Against Assets.
|
The
assets of the Borrower or the assets of any Subsidiary of the Borrower are
attached, seized, levied upon or subjected to a writ or distress warrant; or
such come within the possession of any receiver, trustee, custodian or assignee
for the benefit of creditors and the same is not cured within thirty (30) days
thereafter or otherwise fully bonded or covered by insurance (subject to
reasonable and customary deductible amounts);
|
9.1.9.
|
Notice of Lien or
Assessment.
|
A notice
of Lien or assessment in excess of $10,000,000.00 (which is not a Permitted
Lien) or an Environmental Complaint in excess of $10,000,000.00 is filed of
record with respect to all or any part of any of the Borrower's or any of its
Subsidiaries' assets by the United States, or any department, agency or
instrumentality thereof, or by any state, county, municipal or other
governmental agency, including the PBGC, or any taxes or debts owing at any time
or times hereafter to any one of these becomes payable and the same is not paid
within thirty (30) days after the same becomes payable;
|
9.1.10.
|
Insolvency.
|
The
Borrower ceases to be Solvent or admits in writing to a creditor or Official
Body its inability to pay its debts as they mature;
|
9.1.11.
|
Events Relating to
Plans and Benefit
Arrangements.
|
Any of
the following occurs: (a) any Reportable Event;
(b) proceedings shall have been instituted or other action taken to
terminate any Plan in a distress termination; (c) a trustee shall be
appointed by the PBGC to administer or liquidate any Plan; (d) the PBGC
shall give notice of its intent to institute proceedings to terminate any Plan
or Plans or to appoint a trustee to administer or liquidate any Plan; and, in
the case of the occurrence of (a), (b), (c) or (d) above, which could reasonably
be expected to result in a Material Adverse Change; (e) the Borrower or any
member of the ERISA Group shall fail to make any contributions when due to a
Plan or a Multiemployer Plan; (f) the Borrower or any other member of the
ERISA Group shall withdraw completely or partially from a Multiemployer Plan;
(g) the Borrower or any other member of the ERISA Group shall withdraw (or
shall be deemed under Section 4062(e) of ERISA to withdraw) from a Multiple
Employer Plan; or (h) any applicable Law is adopted, changed or interpreted
by any Official Body with respect to or otherwise affecting one or more
Plans, Multiple Employer Plans Multiemployer Plans or Benefit
Arrangements and, with respect to any of the events specified in (e), (f), (g)
or (h) such occurrence could reasonably be expected to result in a Material
Adverse Change;
|
9.1.12.
|
Cessation of
Business.
|
The
Borrower or any Subsidiary of the Borrower ceases to conduct its business as
contemplated, except as expressly permitted under Section 8.2.5
[Liquidations, Mergers, Etc.], Section
8.2.6
[Disposition of Assets or Subsidiaries] or Section
8.2.9 [Continuation of or Change of Business] or the Borrower or any
Subsidiary of the Borrower is enjoined, restrained or in any way prevented by
court order from conducting all or any material part of its business and such
injunction, restraint or other preventive order is not dismissed within thirty
(30) days after the entry thereof;
|
9.1.13.
|
Change of
Control.
|
(a) Any
person or group of persons (within the meaning of Sections 13(d) or 14(a)
of the Securities Exchange Act of 1934, as amended) shall have acquired
beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the SEC
under said Act) 25% or more of the voting capital stock of the Parent (provided
that, for purposes of calculating the acquisition of beneficial ownership, any
transfer of voting stock of the Parent by any Person or group of Persons to a
Permitted Transferee shall be deemed not to constitute a conveyance and
acquisition of such stock), or (b) within a period of twelve (12)
consecutive calendar months, individuals who were directors of the
Parent on the first day of such period shall cease to constitute a
majority of the board of directors of the Parent unless the individuals who were
elected or appointed directors during such twelve (12) month period were elected
or appointed by a majority of the individuals who were directors of the Parent
on the first day of such period or by their duly appointed or elected
successors; or (c) the Parent shall cease to own 100% of the issued and
outstanding equity interests of the Borrower;
|
9.1.14.
|
Involuntary
Proceedings.
|
A
proceeding shall have been instituted in a court having jurisdiction in the
premises seeking a decree or order for relief in respect of the Borrower or any
Subsidiary of the Borrower in an involuntary case under any applicable
bankruptcy, insolvency, reorganization or other similar law now or hereafter in
effect, or for the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator, conservator (or similar official) of the Borrower or any
Subsidiary of the Borrower for any substantial part of its property, or for the
winding-up or liquidation of its affairs, and such proceeding shall remain
undismissed or unstayed and in effect for a period of sixty (60) consecutive
days or such court shall enter a decree or order granting any of the relief
sought in such proceeding; or
|
9.1.15.
|
Voluntary
Proceedings.
|
The
Borrower or any Subsidiary of the Borrower shall commence a voluntary case under
any applicable bankruptcy, insolvency, reorganization or other similar law now
or hereafter in effect, shall consent to the entry of an order for relief in an
involuntary case under any such law, or shall consent to the appointment or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator, conservator (or other similar official) of itself or for any
substantial part of its property or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due, or shall take any action in furtherance of any of the
foregoing.
9.2 Consequences of Event of
Default.
|
9.2.1.
|
Events of Default
Other Than Bankruptcy, Insolvency or Reorganization
Proceedings.
|
If an
Event of Default specified under Sections 9.1.1
through 9.1.13
shall occur and be continuing, the Lenders and the Agent shall be under no
further obligation to make Loans or issue Letters of Credit, as the case may be,
and the Agent may, and upon the request of the Required Lenders shall, by
written notice to the Borrower, take one or both of the following actions:
(a) terminate the Commitments and thereupon the Commitments shall be
terminated and of no further force and effect, or (b) declare the unpaid
principal amount of the Notes and Loans then outstanding and all interest
accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to
the Lenders hereunder and thereunder to be forthwith due and payable, and the
same shall thereupon become and be immediately due and payable to the Agent for
the benefit of each Lender without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived, and
(c) require the Borrower to, and the Borrower shall thereupon, deposit in a
non-interest-bearing account with the Agent, as cash collateral for its
Obligations under the Loan Documents, an amount equal to the maximum amount
currently or at any time thereafter available to be drawn on all outstanding
Letters of Credit, and the Borrower hereby pledges to the Agent and the Lenders,
and grants to the Agent and the Lenders a security interest in, all such cash as
security for such Obligations. Upon the curing of all existing Events
of Default to the satisfaction of the Required Lenders, the Agent shall return
such cash collateral to the Borrower; and
|
9.2.2.
|
Bankruptcy, Insolvency
or Reorganization
Proceedings.
|
If an
Event of Default specified under Sections 9.1.14
[Involuntary Proceedings] or 9.1.15
[Voluntary Proceedings] shall occur, the Commitments shall automatically
terminate and be of no further force and effect, the Agent and the Lenders shall
be under no further obligations to make Loans or issue Letters of Credit, as the
case may be, and the unpaid principal amount of the Loans then outstanding and
all interest accrued thereon, any unpaid fees and all other Indebtedness of the
Borrower to the Lenders hereunder and thereunder shall be immediately due and
payable, without presentment, demand, protest or notice of any kind, all of
which are hereby expressly waived; and
|
9.2.3.
|
Set-off.
|
If an
Event of Default shall occur and be continuing, any Lender to whom any
Obligation is owed by the Borrower hereunder or under any other Loan Document or
any participant of such Lender which has agreed in writing to be bound by the
provisions of Section 10.13
[Equalization of Lenders] and any branch, Subsidiary or Affiliate of such Lender
or participant anywhere in the world shall have the right, in addition to all
other rights and remedies available to it, without notice to the Borrower, to
set-off against and apply to the then unpaid balance of all the Loans and all
other Obligations of the Borrower hereunder or under any other Loan Document any
debt owing to, and any other funds held in any manner for the account of, the
Borrower by such Lender or participant or by such branch, Subsidiary or
Affiliate, including all funds in all deposit accounts (whether time or demand,
general or special, provisionally credited or finally credited, or otherwise)
now or hereafter maintained by the Borrower for its own account (but not
including funds held in custodian or trust accounts) with such Lender or
participant or such branch, Subsidiary or Affiliate. Such right shall
exist whether or not any Lender or the Agent shall have made any demand under
this Agreement or any other Loan Document, whether or not such debt owing to or
funds held for the account of the Borrower is or are matured or unmatured and
regardless of the existence or adequacy of any Guaranty or any other security,
right or remedy available to any Lender or the Agent; and
|
9.2.4.
|
Suits, Actions,
Proceedings.
|
If an
Event of Default shall occur and be continuing, and whether or not the Agent
shall have accelerated the maturity of Loans pursuant to any of the foregoing
provisions of this Section 9.2,
the Agent or any Lender, if owed any amount with respect to the Loans, may
proceed to protect and enforce its rights by suit in equity, action at law
and/or other appropriate proceeding, whether for the specific performance of any
covenant or agreement contained in this Agreement or the other Loan Documents;
and
|
9.2.5.
|
Application of
Proceeds; Collateral
Sharing.
|
9.2.5.1 Application of
Proceeds.
From and
after the date on which the Agent has taken any action pursuant to this Section 9.2
and until all Obligations of the Borrower have been paid in full, any and all
proceeds received by the Agent from the exercise of any remedy by the Agent,
shall be applied as follows:
(a) first,
to reimburse the Agent and the Lenders for out-of-pocket costs, expenses and
disbursements, including reasonable attorneys' and paralegals' fees and legal
expenses, incurred by the Agent or the Lenders in connection with collection of
any Obligations of the Borrower under any of the Loan Documents;
(b) second,
to the repayment of all Indebtedness then unpaid of the Borrower to the Lenders
incurred under this Agreement or any of the other Loan Documents, whether of
principal, interest, fees, expenses or otherwise, in such manner as the Agent
may determine in its discretion; and
(c) the
balance, if any, as required by Law.
9.2.5.2 Collateral
Sharing.
All Liens
granted under each Loan Document (the "Collateral
Documents") shall secure ratably and on a pari passu basis
(a) the Obligations in favor of the Agent and the Lenders hereunder, and
(b) the Obligations incurred by the Borrower in favor of any Lender and
Lender's Affiliates which provides a Lender Provided Interest Rate Hedge (the
"IRH
Provider"). The Agent under the Collateral Documents shall be
deemed to serve as the collateral agent (the "Collateral
Agent") for the IRH Provider and the Lenders hereunder, provided that the
Collateral Agent shall comply with the instructions and directions of the Agent
(or the Lenders under this Agreement to the extent that this Agreement or any
other Loan Documents empowers the Lenders to direct the Agent), as to all
matters relating to the collateral, including the maintenance and disposition
thereof. No IRH Provider (except in its capacity as a Lender
hereunder) shall be entitled or have the power to direct or instruct the
Collateral Agent on any such matters or to control or direct in any manner the
maintenance or disposition of the collateral.
|
9.2.6.
|
Other Rights and
Remedies.
|
In
addition to all of the rights and remedies contained in this Agreement or in any
of the other Loan Documents, the Agent shall have all of the rights and remedies
under applicable Law, all of which rights and remedies shall be cumulative and
non-exclusive, to the extent permitted by Law. The Agent may, and
upon the request of the Required Lenders shall, exercise all post-default rights
granted to the Agent and the Lenders under the Loan Documents or applicable
Law.
10. THE
AGENT
10.1 Appointment.
Each
Lender hereby irrevocably appoints PNC Bank to act on its behalf as the Agent
hereunder and under the other Loan Documents and authorizes the Agent to take
such actions on its behalf and to exercise such powers as are delegated to the
Agent by the terms hereof or thereof, together with such actions and powers as
are reasonably incidental thereto. The provisions of this Section are
solely for the benefit of the Agent, the Lenders and the Issuing Lender
hereunder, and neither the Borrower nor any other party to the Loan Documents
shall have rights as a third party beneficiary of any of such
provisions.
10.2 Delegation of
Duties.
The Agent
may perform any of its duties hereunder by or through agents or employees (provided such
delegation does not constitute a relinquishment of its duties as the Agent) and,
subject to Sections 10.5
[Reimbursement and Indemnification of the Agent by the Borrower] and Section
10.6
[Exculpatory Provisions; Limitation of Liability], shall be entitled to engage
and pay for the advice or services of any attorneys, accountants or other
experts concerning all matters pertaining to its duties hereunder and to rely
upon any advice so obtained. It is acknowledged and agreed that
JPMorgan Chase Bank, N.A. has received the title of syndication agent under this
Agreement, that each of U.S. Bank, National Association and Toronto Dominion
(New York) LLC has received the title of documentation agent under this
Agreement. Such designations are solely to give each of the foregoing Lenders
its respective title, and each such designated Lender: (a) has no
duties, responsibilities, functions, obligations or liabilities implied or
otherwise under the Loan Documents solely as a result of being so designated as
a syndication agent or documentation agent, respectively, and (b) is not
entitled to any fee solely as a result of being so designated as a syndication
agent or documentation agent, respectively.
10.3 Nature of Duties;
Independent Credit Investigation.
The Agent
shall have no duties or responsibilities except those expressly set forth in
this Agreement and no implied covenants, functions, responsibilities, duties,
obligations, or liabilities shall be read into this Agreement or otherwise
exist. The duties of the Agent shall be mechanical and administrative
in nature; the Agent shall not have by reason of this Agreement a fiduciary or
trust relationship in respect of any Lender; and nothing in this Agreement,
expressed or implied, is intended to or shall be so construed as to impose upon
the Agent any obligations in respect of this Agreement except as expressly set
forth herein. Without limiting the generality of the foregoing, the
use of the term "agent" in this Agreement with reference to the Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law. Instead, such
term is used merely as a matter of market custom, and is intended to create or
reflect only an administrative relationship between independent contracting
parties. Each Lender expressly acknowledges (a) that the Agent
has not made any representations or warranties to it and that no act by the
Agent hereafter taken, including any review of the affairs of the Borrower shall
be deemed to constitute any representation or warranty by the Agent to any
Lender; (b) that it has made and will continue to make, without reliance
upon the Agent, its own independent investigation of the financial condition and
affairs and its own appraisal of the creditworthiness of the Borrower in
connection with this Agreement and the making and continuance of the Loans
hereunder; and (c) except as expressly provided herein, that the Agent
shall have no duty or responsibility, either initially or on a continuing basis,
to provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the making of any Loan or at any time
or times thereafter.
10.4 Actions in Discretion of
Agent; Instructions From the Lenders.
The Agent
agrees, upon the written request of the Required Lenders, to take or refrain
from taking any action of the type specified as being within the Agent's rights,
powers or discretion herein, provided that the Agent shall
not be required to take any action which exposes the Agent to personal liability
or which is contrary to this Agreement or any other Loan Document or applicable
Law. In the absence of a request by the Required Lenders, the Agent
shall have authority, in its sole discretion, to take or not to take any such
action, unless this Agreement specifically requires the consent of the Required
Lenders or all of the Lenders. Any action taken or failure to act
pursuant to such instructions or discretion shall be binding on the Lenders,
subject to Section 10.6
[Exculpatory Provisions, Etc.]. Subject to the provisions of Section 10.6,
no Lender shall have any right of action whatsoever against the Agent as a
result of the Agent acting or refraining from acting hereunder in accordance
with the instructions of the Required Lenders, or in the absence of such
instructions, in the absolute discretion of the Agent.
10.5 Reimbursement and
Indemnification of Agent by the Borrower.
The
Borrower agrees to pay or reimburse the Agent and hold the Agent harmless
against (a) liability for the payment of all reasonable out-of-pocket
costs, expenses and disbursements, including fees and expenses of counsel
(excluding, so long as no Event of Default or Potential Default is occurring,
the allocated costs of staff counsel), appraisers and environmental consultants,
incurred by the Agent (i) in connection with the negotiation, preparation,
printing, execution, administration, syndication, interpretation and performance
of this Agreement and the other Loan Documents, (ii) relating to any
amendments, waivers or consents pursuant to the provisions hereof, requested by
the Borrower or required by applicable law, (iii) in connection with the
enforcement of this Agreement or any other Loan Document or collection of
amounts due hereunder or thereunder or the proof and allowability of any claim
arising under this Agreement or any other Loan Document, whether in bankruptcy
or receivership proceedings or otherwise, (iv) in any workout or
restructuring or in connection with the protection, preservation, exercise or
enforcement of any of the terms hereof or of any rights hereunder or under any
other Loan Document or in connection with any foreclosure, collection or
bankruptcy proceedings, and (v) in connection with any Environmental Complaint
threatened or asserted against the Agent or the Lenders in any way relating to
or arising out of this Agreement or any other Loan Documents (including, without
limitation, the protection, preservation, exercise or enforcement of any of the
terms hereof or of any rights hereunder or under any other Loan Document or in
connection with any foreclosure, collection or bankruptcy proceedings or in any
workout or restructuring) and (b) 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 Agent, in its capacity as such, in any way relating to or
arising out of (i) this Agreement or any other Loan Documents or any action
taken or omitted by the Agent hereunder or thereunder, and (ii) any
Environmental Complaint in any way relating to or arising out of this Agreement
or any other Loan Documents or any action taken or omitted by the Agent
hereunder or thereunder, provided that the Borrower
shall not be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
if the same results solely from the Agent's gross negligence or willful
misconduct as determined in a final, unappealable judgment of a court of
competent jurisdiction, or if the Borrower was not given notice of the subject
claim and the opportunity to participate in the defense thereof, at its expense
(except that the Borrower shall remain liable to the extent such failure to give
notice does not result in a loss to the Borrower), or if the same results from a
compromise or settlement agreement entered into without the consent of the
Borrower, which shall not be unreasonably withheld. In addition, the
Borrower agrees to reimburse and pay all reasonable out-of-pocket expenses of
the Agent's regular employees and agents engaged periodically to perform audits
of the Borrower's books, records and business properties, subject in all cases
to the limitation set forth in Section 8.1.6
[Visitation Rights].
10.6 Exculpatory Provisions;
Limitation of Liability.
Neither
the Agent nor any of its directors, officers, employees, agents, attorneys or
Affiliates shall (a) be liable to any Lender for any action taken or
omitted to be taken by it or them hereunder, or in connection herewith including
pursuant to any Loan Document, unless caused by its or their own gross
negligence or willful misconduct as determined in a final, unappealable judgment
of a court of competent jurisdiction, (b) be responsible in any manner to
any of the Lenders for the effectiveness, enforceability, genuineness, validity
or the due execution of this Agreement or any other Loan Documents or for any
recital, representation, warranty, document, certificate, report or statement
herein or made or furnished under or in connection with this Agreement or any
other Loan Documents, or (c) be under any obligation to any of the Lenders
to ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions hereof or thereof on the part of the Borrower, or
the financial condition of the Borrower or the existence or possible existence
of any Event of Default or Potential Default. Each Lender agrees
that, except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Agent hereunder or given to the Agent for the
account of or with copies for the Lenders, the Agent and each of its directors,
officers, employees, agents, attorneys or Affiliates shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Agent or any of its directors, officers, employees,
agents, attorneys or Affiliates.
10.7 Reimbursement and
Indemnification of Agent by Lenders.
Each
Lender agrees to reimburse and indemnify, defend and save the Agent (to the
extent not reimbursed by the Borrower and without limiting the Obligation of the
Borrower to do so) in proportion to its Ratable Share harmless from and against
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements, including attorneys' fees and
disbursements (including the allocated costs of staff counsel), and costs of
appraisers and environmental consultants, of any kind or nature whatsoever which
may be imposed on, incurred by or asserted against the Agent, in its capacity as
such, in any way relating to or arising out of this Agreement or any other Loan
Documents or any action taken or omitted by the Agent hereunder or thereunder,
provided that no Lender shall
be liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
(a) if the same results from the Agent's gross negligence or willful
misconduct as determined in a final, unappealable judgment of a court of
competent jurisdiction, or (b) if such Lender was not given notice of the
subject claim and the opportunity to participate in the defense thereof, at its
expense (subject to reimbursement by the Borrower pursuant to Section
11.3 [Reimbursement and Indemnification of Lenders by the Borrower;
Limitation on Damages ; Taxes] and except that such Lender shall remain liable
to the extent such failure to give notice does not result in a loss to the
Lender), or (c) if the same results from a compromise and settlement
agreement entered into without the consent of such Lender, which shall not be
unreasonably withheld. In addition, each Lender agrees promptly upon
demand to reimburse the Agent (to the extent not reimbursed by the Borrower and
without limiting the Obligation of the Borrower to do so) in proportion to its
Ratable Share for all amounts due and payable by the Borrower to the Agent in
connection with the Agent's periodic audit of the Borrower's books, records and
business properties.
10.8 Reliance by
Agent.
Except as
otherwise expressly provided herein, the Agent shall be entitled to rely upon
any writing, telex or teletype message, resolution, notice, consent,
certificate, letter, statement, order or other document or conversation by
telephone or otherwise believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons, and upon the advice and
opinions of counsel and other professional advisers selected by the
Agent. The Agent shall be fully justified in failing or refusing to
take any action hereunder unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such
action.
10.9 Notice of
Default.
The Agent
shall not be deemed to have knowledge or notice of the occurrence of any
Potential Default or Event of Default unless the Agent has received written
notice from a Lender or the Borrower referring to this Agreement, describing
such Potential Default or Event of Default and stating that such notice is a
"notice of default."
10.10 Notices.
The Agent
shall promptly send to each Lender a copy of all notices received from the
Borrower pursuant to the provisions of this Agreement or the other Loan
Documents promptly upon receipt thereof. The Agent shall promptly
notify the Borrower and the other Lenders of each change in the Base Rate and
the effective date thereof.
10.11 Lenders in Their Individual
Capacities; Agents in Its Individual Capacity.
With
respect to its Commitment and the Loans made by it and any other rights and
powers given to it as a Lender hereunder or under any of the other Loan
Documents, the Agent shall have the same rights and powers hereunder as any
other Lender and may exercise the same as though it were not the Agent, and the
term "Lender" and "Lenders" shall, unless the context otherwise indicates,
include the Agent in its individual capacity. PNC Bank and its
Affiliates and each of the Lenders and their respective Affiliates may, without
liability to account, except as prohibited herein, make loans to, issue letters
of credit for the account of, acquire equity interests in, accept deposits from,
discount drafts for, act as trustee under indentures of, and generally engage in
any kind of banking, trust, financial advisory, underwriting or other business
with, the Borrower and its Affiliates, in the case of the Agent, as though it
were not acting as Agent hereunder and in the case of each Lender, as though
such Lender were not a Lender hereunder, in each case without notice to or
consent of the other Lenders. The Lenders acknowledge that, pursuant
to such activities, the Agent or its Affiliates may (a) receive information
regarding the Borrower or any of its Subsidiaries or Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Borrower or such Subsidiary or Affiliate) and acknowledge that the Agent shall
be under no obligation to provide such information to them, and (b) accept
fees and other consideration from the Borrower for services in connection with
this Agreement and otherwise without having to account for the same to the
Lenders.
10.12 Holders of
Notes.
The Agent
may deem and treat any payee of any Note as the owner thereof for all purposes
hereof unless and until written notice of the assignment or transfer thereof
shall have been filed with the Agent. Any request, authority or
consent of any Person who at the time of making such request or giving such
authority or consent is the holder of any Note shall be conclusive and binding
on any subsequent holder, transferee or assignee of such Note or of any Note or
Notes issued in exchange therefor.
10.13 Equalization of the
Lenders.
The
Lenders and the holders of any participations in any Commitments or Loans or
other rights or obligations of a Lender hereunder agree among themselves
that, with respect
to all amounts received by any Lender or any such holder for application on any
Obligation hereunder or under any such participation, whether received by
voluntary payment, by realization upon security, by the exercise of the right of
set-off or banker's lien, by counterclaim or by any other non-pro rata source,
equitable adjustment will be made in the manner stated in the following sentence
so that, in effect, all such excess amounts will be shared ratably among the
Lenders and such holders in proportion to their interests in payments on the
Loans, except as otherwise provided in Sections 4.4.3
[Agent's and Lender's Rights], 5.4.2
[Replacement of a Lender] or 5.6
[Additional Compensation in Certain Circumstances]. The Lenders or
any such holder receiving any such amount shall purchase for cash from each of
the other Lenders an interest in such Lender's Loans in such amount as shall
result in a ratable participation by the Lenders and each such holder in the
aggregate unpaid amount of the Loans, provided that if all or any
portion of such excess amount is thereafter recovered from the Lender or the
holder making such purchase, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, together with interest or other
amounts, if any, required by law (including court order) to be paid by the
Lender or the holder making such purchase.
10.14 Resignation of the
Agent.
The Agent
may at any time give notice of its resignation as Agent to the Lenders, the
Lender issuing Letters of Credit hereunder (the "Issuing
Lender"), and the Borrower. Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, with approval from the
Borrower (so long as no Event of Default has occurred and is continuing), to
appoint a successor, such approval not to be unreasonably withheld or
delayed. If no such successor shall have been so appointed and by the
Required Lenders and so approved by the Borrower (as applicable) within thirty
(30) days after the retiring Agent gives notice of its resignation, then
the retiring Agent may on behalf of the Lenders and the Issuing Lender, appoint
a successor Agent meeting the qualifications set forth above; provided that if the Agent
shall notify the Borrower and the Lenders that no qualifying Person has accepted
such appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (a) the retiring Agent shall be discharged
from its duties and obligations hereunder and under the other Loan Documents
(except that in the case of any collateral security held by the Agent on behalf
of the Lenders or the Issuing Lender under any of the Loan Documents, the
retiring Agent shall continue to hold such collateral security until such time
as a successor Agent is appointed) and (b) all payments, communications and
determinations provided to be made by, to or through the Agent shall instead be
made by or to each Lender and the Issuing Lender directly, until such time as
the Required Lenders appoint a successor Agent as provided for above in this
Section. Upon the acceptance of a successor's appointment as Agent
hereunder, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring (or retired) Agent, and
the retiring Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents (if not already discharged therefrom
as provided above in this Section). The fees payable by the Borrower
to a successor Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such
successor. After the retiring Agent's resignation hereunder and under
the other Loan Documents, the provisions of this Section
10.14 and Section
11.3 [Reimbursement and Indemnification of Lenders by the Borrower;
Taxes] shall continue in effect for the benefit of such retiring Agent, its
sub-agents and their respective Affiliates, and their and their Affiliates'
respective partners, directors, officers, employees, agents and advisors (for
purposes hereof, "Related
Parties") in respect of any actions taken or omitted to be taken by any
of them while the retiring Agent was acting as Agent.
If PNC
Bank resigns as Agent under this Section, PNC Bank shall also resign as Issuing
Lender. Upon the appointment of a successor Agent hereunder, such
successor shall (i) succeed to all of the rights, powers, privileges and duties
of PNC Bank as the retiring Issuing Lender and the Agent and PNC Bank shall be
discharged from all of its respective duties and obligations as Issuing Lender
and Agent under the Loan Documents, and (ii) issue letters of credit in
substitution for the Letters of Credit issued by PNC Bank, if any, outstanding
at the time of such succession or make other arrangement satisfactory to PNC
Bank to effectively assume the obligations of PNC Bank with respect to such
Letters of Credit.
10.15 The Agent's
Fee.
The
Borrower shall pay to the Agent a nonrefundable fee (the "Agent's
Fee") for the Agent's services hereunder under the terms of a letter (the
"Agent’s
Letter") between the Borrower and the Agent dated August 12,
2009.
10.16 Availability of
Funds.
The Agent
may assume that each Lender has made or will make the proceeds of a Loan
available to the Agent unless the Agent shall have been notified by such Lender
on or before the later of (a) the close of Business on the Business Day
preceding the Borrowing Date with respect to such Loan or (b) two (2) hours
before the time on which the Agent actually funds the proceeds of such Loan to
the Borrower (whether using its own funds pursuant to this Section 10.16
or using proceeds deposited with the Agent by the Lenders and whether such
funding occurs before or after the time on which Lenders are required to deposit
the proceeds of such Loan with the Agent). The Agent may, in reliance
upon such assumption (but shall not be required to), make available to the
Borrower a corresponding amount. If such corresponding amount is not
in fact made available to the Agent by such Lender, the Agent shall be entitled
to recover such amount on demand from such Lender (or, if such Lender fails to
pay such amount forthwith upon such demand from the Borrower) together with
interest thereon, in respect of each day during the period commencing on the
date such amount was made available to the Borrower and ending on the date the
Agent recovers such amount, at a rate per annum equal to (i) the Federal Funds
Effective Rate during the first three (3) days after such interest shall begin
to accrue and (ii) the applicable interest rate in respect of such Loan after
the end of such three-day period.
10.17 Calculations.
In the
absence of gross negligence or willful misconduct as determined in a final,
unappealable judgment of a court of competent jurisdiction, the Agent shall not
be liable for any error in computing the amount payable to any Lender whether in
respect of the Loans, fees or any other amounts due to the Lenders under this
Agreement. In the event an error in computing any amount payable to
any Lender is made, the Agent, the Borrower and each affected Lender shall,
forthwith upon discovery of such error, make such adjustments as shall be
required to correct such error, and any compensation therefor will be calculated
at the Federal Funds Effective Rate.
10.18 Beneficiaries.
Except
for Sections
10.5 [Reimbursement and Indemnification of Agent by the Borrower] and
10.15
[The Agent's Fee] and as otherwise expressly provided herein, the provisions of
this Section 10
are solely for the benefit of the Agent and the Lenders, and the Borrower shall
not have any rights to rely on or enforce any of the provisions of this Section 10. In
performing its functions and duties under this Agreement, the Agent shall act
solely as agent of the Lenders and does not assume and shall not be deemed to
have assumed any obligation toward or relationship of agency or trust with or
for the Borrower.
10.19 No Reliance on the Agent's
Customer Identification Program.
Each
Lender acknowledges and agrees that neither such Lender, nor any of its
Affiliates, participants or assignees, may rely on the Agent to carry out such
Lender's, Affiliate's, participant's or assignee's customer identification
program, or other obligations required or imposed under or pursuant to the USA
Patriot Act or the regulations thereunder, including the regulations contained
in 31 CFR 103.121 (as hereafter amended or replaced, the "CIP
Regulations"), or any other Anti-Terrorism Law, including any programs
involving any of the following items relating to or in connection with the
Borrower, any Subsidiary of the Borrower, the Affiliates or the agents of the
Borrower or any Subsidiary of the Borrower, the Loan Documents or the
transactions hereunder or contemplated hereby: (a) any identity
verification procedures, (b) any record keeping, (c) comparisons with
government lists, (d) customer notices or (e) other procedures
required under the CIP Regulations or such other Laws.
11. MISCELLANEOUS
11.1 Modifications, Amendments or
Waivers.
With the
written consent of the Required Lenders, the Agent, acting on behalf of all the
Lenders, and the Borrower may from time to time enter into written agreements
amending or changing any provision of this Agreement or any other Loan Document
or the rights of the Lenders or the Borrower hereunder or thereunder, or may
grant written waivers or consents to a departure from the due performance of the
Obligations of the Borrower hereunder or thereunder. Any such
agreement, waiver or consent made with such written consent shall be effective
to bind all the Lenders and the Borrower; provided, that, no
such agreement, waiver or consent may be made which will:
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11.1.1.
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Increase of Revolving
Credit Commitments; Extension of Expiration
Date.
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Without
the written consent of all Lenders:
(a) increase
the amount of the Revolving Credit Commitment of any Lender hereunder, (other
than any increase in the amount of the Revolving Credit Commitments in
accordance with Section
2.11 [Right to Increase Commitments], which increase shall not require
the consent of any Lender, other than each Lender increasing its Revolving
Credit Commitment),
(b) extend
the Expiration Date,
(c) whether
or not any Revolving Credit Loans are outstanding extend the time for payment of
principal or interest of any Revolving Credit Loan (excluding the due date of
any mandatory prepayment of a Revolving Credit Loan or any mandatory Revolving
Credit Commitment reduction in connection with such a mandatory prepayment
hereunder except for mandatory reductions of the Revolving Credit Commitments on
the Expiration Date), the Commitment Fee, or any other fee payable to any Lender
which has a Revolving Credit Commitment, or
(d) reduce
the principal amount of or the rate of interest borne by any Revolving Credit
Loan or reduce the Commitment Fee or any other fee payable to any Lender which
has a Revolving Credit Commitment, or otherwise affect the terms of payment of
the principal of or interest of any Revolving Credit Loan, the Commitment Fee,
or any other fee payable to any Lender which has a Revolving Credit
Commitment;
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11.1.2.
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Release of
Collateral or
Guarantor.
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Without
the written consent of all Lenders (other than Defaulting Lenders), release any
guarantor from its obligations under any guaranty agreement providing for a
guaranty of the Obligations or any other security for any of the Borrower's
Obligations; or
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11.1.3.
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Miscellaneous.
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Without
the written consent of all Lenders (other than Defaulting Lenders), amend Sections 5.2
[Pro Rata Treatment of Lenders], 9.2.5
[Application of Proceeds; Collateral Sharing], 10.6
[Exculpatory Provisions, Etc.] or 10.13
[Equalization of Lenders] or this Section 11.1,
alter any provision regarding the pro rata treatment of the Lenders, change the
definition of Required Lenders, or change any requirement providing for the
Lenders or the Required Lenders to authorize the taking of any action hereunder;
provided, that
no agreement, waiver or consent which would modify the interests, rights or
obligations of the Agent in its capacity as Agent or as the Issuing Lender shall
be effective without the written consent of the Agent, and no agreement, waiver
or consent which would modify the interests, rights or obligations of PNC Bank
with respect to its Swing Loan Commitment shall be effective without the written
consent of PNC Bank; and provided, further that, if in
connection with any proposed waiver, amendment or modification referred to in
Sections
11.1.1 [Increase of Revolving Credit Commitments; Extension of Expiration
Date] through 11.1.3
above, the consent of the Required Lenders is obtained but the consent of one or
more of such other Lenders whose consent is required is not obtained (each a
"Non-Consenting
Lender"), then the Borrower shall have the right to replace any such
Non-Consenting Lender with one or more replacement Lenders pursuant to Section
5.4.2 [Replacement of a Lender].
11.2 No Implied Waivers;
Cumulative Remedies; Writing Required.
No course
of dealing and no delay or failure of the Agent or any Lender in exercising any
right, power, remedy or privilege under this Agreement or any other Loan
Document shall affect any other or future exercise thereof or operate as a
waiver thereof, nor shall any single or partial exercise thereof or any
abandonment or discontinuance of steps to enforce such a right, power, remedy or
privilege preclude any further exercise thereof or of any other right, power,
remedy or privilege. The rights and remedies of the Agent and the
Lenders under this Agreement and any other Loan Documents are cumulative and not
exclusive of any rights or remedies which they would otherwise
have. Any waiver, permit, consent or approval of any kind or
character on the part of any Lender of any breach or default under this
Agreement or any such waiver of any provision or condition of this Agreement
must be in writing and shall be effective only to the extent specifically set
forth in such writing.
11.3 Reimbursement and
Indemnification of Lenders by the Borrower; Limitation on Damages;
Taxes.
The
Borrower agrees upon demand to pay or reimburse to each Lender (other than the
Agent, as to which the Borrower's Obligations are set forth in Section 10.5
[Reimbursement and Indemnification of Agent by the Borrower]) and to save such
Lender harmless against (a) liability for the payment of all reasonable
out-of-pocket costs, expenses and disbursements (including fees and expenses of
counsel (including allocated costs of staff counsel) for each Lender except with
respect to (A) and (B) below), incurred by such Lender (i) in connection
with the administration and interpretation of this Agreement, and other
instruments and documents to be delivered hereunder, (ii) relating to any
amendments, waivers or consents pursuant to the provisions hereof requested by
the Borrower or required by applicable law, (iii) in connection with the
enforcement of this Agreement or any other Loan Document, or collection of
amounts due hereunder or thereunder or the proof and allowability of any claim
arising under this Agreement or any other Loan Document, whether in bankruptcy
or receivership proceedings or otherwise, (iv) in any workout or
restructuring or in connection with the protection, preservation, exercise or
enforcement of any of the terms hereof or of any rights hereunder or under any
other Loan Document or in connection with any foreclosure, collection or
bankruptcy proceedings, and (v) in connection with any Environmental Complaint
threatened or asserted against such Lender in any way relating to or arising out
of this Agreement or any other Loan Documents (including, without limitation,
the protection, preservation, exercise or enforcement of any of the terms hereof
or of any rights hereunder or under any other Loan Document or in connection
with any foreclosure, collection or bankruptcy proceedings or in any workout or
restructuring), or (b) 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 such Lender, in its capacity as such, in any way relating to or arising
out of (i) this Agreement or any other Loan Documents or any action taken or
omitted by such Lender hereunder or thereunder, and (ii) any Environmental
Complaint in any way relating to or arising out of this Agreement or any other
Loan Documents or any action taken or omitted by such Lender hereunder or
thereunder, provided that the Borrower
shall not be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
(A) if the same results from such Lender's gross negligence or willful
misconduct as determined in a final, unappealable judgment of a court of
competent jurisdiction, or (B) if the Borrower was not given notice of the
subject claim and the opportunity to participate in the defense thereof, at its
expense (except that the Borrower shall remain liable to the extent such failure
to give notice does not result in a loss to the Borrower), or (C) if the
same results from a compromise or settlement agreement entered into without the
consent of the Borrower, which shall not be unreasonably
withheld. The Lenders will attempt to minimize the fees and expenses
of legal counsel for the Lenders which are subject to reimbursement by the
Borrower hereunder by considering the usage of one law firm to represent the
Lenders and the Agent if appropriate under the circumstances. No claim may be
made by the Borrower, any Lender, the Agent or any of their respective
Subsidiaries against the Agent, any Lender or any of their respective directors,
officers, employees, agents, attorneys or Affiliates, or any of them, for any
special, indirect or consequential damages or, to the fullest extent permitted
by Law, for any punitive damages in respect of any claim or cause of action
(whether based on contract, tort, statutory liability, or any other ground)
based on, arising out of or related to any Loan Document or the transactions
contemplated hereby or any act, omission or event occurring in connection
therewith, including the negotiation, documentation, administration or
collection of the Loans, and the Borrower (for itself and on behalf of each of
its Subsidiaries), the Agent and each Lender hereby waives, releases and agrees
never to sue upon any claim for any such damages, whether such claim now exists
or hereafter arises and whether or not it is now known or suspected to exist in
its favor. The Borrower agrees unconditionally to pay all stamp,
document, transfer, recording or filing taxes or fees and similar impositions
now or hereafter determined by the Agent or any Lender to be payable in
connection with this Agreement or any other Loan Document, and the Borrower
agrees unconditionally to save the Agent and the Lenders harmless from and
against any and all present or future claims, liabilities or losses with respect
to or resulting from any omission to pay or delay in paying any such taxes, fees
or impositions.
11.4 Holidays.
Whenever
payment of a Loan to be made or taken hereunder shall be due on a day which is
not a Business Day such payment shall be due on the next Business Day (except as
provided in Section 4.2
[Interest Periods] with respect to Interest Periods under the Euro-Rate Option)
and such extension of time shall be included in computing interest and fees,
except that the Revolving Credit Loans and Swing Loans shall be due on the
Business Day preceding the Expiration Date if the Expiration Date is not a
Business Day. Whenever any payment or action to be made or taken
hereunder (other than payment of the Loans) shall be stated to be due on a day
which is not a Business Day, such payment or action shall be made or taken on
the next following Business Day, and such extension of time shall not be
included in computing interest or fees, if any, in connection with such payment
or action.
11.5 Funding by Branch,
Subsidiary or Affiliate.
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11.5.1.
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Notional
Funding.
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Each
Lender shall have the right from time to time, without notice to the Borrower,
to deem any branch, Subsidiary or Affiliate (which for the purposes of this
Section 11.5
shall mean any corporation or association which is directly or indirectly
controlled by or is under direct or indirect common control with any corporation
or association which directly or indirectly controls such Lender) of such Lender
to have made, maintained or funded any Loan to which the Euro-Rate Option
applies at any time, provided that
immediately following (on the assumption that a payment were then due from the
Borrower to such other office), and as a result of such change, the Borrower
would not be under any greater financial obligation pursuant to Section 5.6
[Additional Compensation in Certain Circumstances] or Section 5.8
[Taxes] than it would have been in the absence of such
change. Notional funding offices may be selected by each Lender
without regard to such Lender's actual methods of making, maintaining or funding
the Loans or any sources of funding actually used by or available to such
Lender.
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11.5.2.
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Actual
Funding.
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Each
Lender shall have the right from time to time to make or maintain any Loan by
arranging for a branch, Subsidiary or Affiliate of such Lender to make or
maintain such Loan subject to the last sentence of this Section 11.5.2. If
any Lender causes a branch, Subsidiary or Affiliate to make or maintain any part
of the Loans hereunder, all terms and conditions of this Agreement shall, except
where the context clearly requires otherwise, be applicable to such part of the
Loans to the same extent as if such Loans were made or maintained by such
Lender, but in no event shall any Lender's use of such a branch, Subsidiary or
Affiliate to make or maintain any part of the Loans hereunder cause such Lender
or such branch, Subsidiary or Affiliate to incur any cost or expenses payable by
the Borrower hereunder or require the Borrower to pay any other compensation to
any Lender (including any expenses incurred or payable pursuant to Section 5.6
[Additional Compensation in Certain Circumstances]) or Section 5.8
[Taxes] which would otherwise not be incurred.
11.6 Notices; Lending
Offices.
Any
notice, request, demand, direction or other communication (for purposes of this
Section
11.6
only, a “Notice”)
to be given to or made upon any party hereto under any provision of this
Agreement shall be given or made by telephone or in writing (which includes
means of electronic transmission (i.e., “e-mail”) or facsimile transmission or
by setting forth such Notice on a restricted access site on the World Wide Web
(a “Website
Posting”) if Notice of such Website Posting (including the information
necessary to access such site) has previously been delivered to the applicable
parties hereto by another means set forth in this Section
11.6)
in accordance with this Section
11.6. Any
such Notice must be delivered to the applicable parties hereto at the addresses
and numbers set forth under their respective names on Schedule
1.1(B)
hereof or in accordance with any subsequent unrevoked Notice from any such party
that is given in accordance with this Section
11.6. Any
Notice shall be effective:
(a) In
the case of hand-delivery, when delivered;
(b) If
given by mail, four days after such Notice is deposited with the United States
Postal Service, with first-class postage prepaid, return receipt
requested;
(c) In
the case of a telephonic Notice, when a party is contacted by telephone, if
delivery of such telephonic Notice is confirmed no later than the next Business
Day by hand delivery, a facsimile or electronic transmission, a Website Posting
or overnight courier delivery of a confirmatory notice (received at or before
noon on such next Business Day);
(d) In
the case of a facsimile transmission, when sent to the applicable party's
facsimile machine's telephone number if the party sending such Notice receives
confirmation of the delivery thereof from its own facsimile
machine;
(e) In
the case of electronic transmission, when actually received;
(f) In
the case of a Website Posting, upon delivery of a Notice of such posting
(including the information necessary to access such web site) by another means
set forth in this Section
11.6;
and
(g) If
given by any other means (including by overnight courier), when actually
received.
Any
Lender giving a Notice to the Borrower shall concurrently send a copy thereof to
the Agent, and the Agent shall promptly notify the other Lenders of its receipt
of such Notice.
11.7 Severability.
The
provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or
in part in any jurisdiction, such provision shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any
jurisdiction.
11.8 Governing
Law.
Each
Letter of Credit and Section 2.9
[Letter of Credit Subfacility] shall be subject to the International Standby
Practices 1998 ("ISP
98") and any subsequent official revision thereof, and to the extent not
inconsistent therewith, the internal laws of the State of New Jersey without
regard to its conflict of laws principles, and the balance of this Agreement
shall be deemed to be a contract under the Laws of the State of New Jersey and
for all purposes shall be governed by and construed and enforced in accordance
with the internal laws of the State of New Jersey without regard to its conflict
of laws principles.
11.9 Prior
Understanding.
This
Agreement and the other Loan Documents supersede all prior understandings and
agreements, whether written or oral, between the parties hereto and thereto
relating to the transactions provided for herein and therein, including any
prior confidentiality agreements and commitments.
11.10 Duration;
Survival.
All
representations and warranties of the Borrower contained herein or made in
connection herewith shall survive the making of Loans and issuance of Letters of
Credit and shall not be waived by the execution and delivery of this Agreement,
any investigation by the Agent or the Lenders, the making of Loans, issuance of
Letters of Credit, or payment in full of the Loans. All covenants and
agreements of the Borrower contained in Sections 8.1
[Affirmative Covenants], 8.2
[Negative Covenants] and 8.3
[Reporting Requirements] herein shall continue in full force and effect from and
after the date hereof so long as the Borrower may borrow or request Letters of
Credit hereunder and until termination of the Commitments and payment in full of
the Loans and expiration or termination of all Letters of Credit. All
covenants and agreements of the Borrower contained herein relating to the
payment of principal, interest, premiums, additional compensation or expenses
and indemnification, including those set forth in Section 5
[Payments] and Sections 10.5
[Reimbursement and Indemnification of the Agent by the Borrower], 10.7
[Reimbursement and Indemnification of the Agent by Lenders] and 11.3
[Reimbursement and Indemnification of the Lenders by the Borrower], shall
survive payment in full of the Loans, expiration or termination of the Letters
of Credit and termination of the Commitments.
11.11 Successors and
Assigns;
Joinder of a Lender.
(a) This
Agreement shall be binding upon and shall inure to the benefit of the Lenders,
the Agent, the Borrower and their respective successors and assigns, except that
the Borrower may not assign or transfer any of its rights and Obligations
hereunder or any interest herein. Each Lender may, at its own cost,
make assignments of or sell participations in all or any part of its Commitments
and the Loans made by it to one or more banks or other entities, subject to the
consent of the Borrower and the Agent with respect to any assignee, such consent
not to be unreasonably withheld, provided that (i) no
consent of the Borrower shall be required (A) if an Event of Default exists and
is continuing, or (B) in the case of an assignment by a Lender to an Affiliate
of such Lender or an Approved Fund of such Lender, (ii) any assignment by a
Lender to a Person other than an Affiliate of such Lender may not be made in
amounts less than the lesser of $5,000,000.00 or the amount of the assigning
Lender's Commitment and (iii) no such assignment or participation shall be
permitted to the Borrower or to any of the Borrower's Affiliates or
Subsidiaries. In the case of an assignment, upon receipt by the Agent
of the Assignment and Assumption Agreement, the assignee shall have, to the
extent of such assignment (unless otherwise provided therein), the same rights,
benefits and obligations as it would have if it had been a signatory Lender
hereunder, the Commitments shall be adjusted accordingly, and upon surrender of
any Revolving Credit Note or subject to such assignment, the Borrower shall
execute and deliver a new Revolving Credit Note to the assignee, if such
assignee requests such a Note in an amount equal to the amount of the Revolving
Credit Commitment assumed by it and a new Revolving Credit Note to the assigning
Lender, if the assigning Lender requests such a Note, in an amount equal to the
Revolving Credit Commitment retained by it hereunder. Any Lender
which assigns any or all of its Commitment or Loans to a Person other than an
Affiliate of such Lender shall pay to the Agent a service fee in the amount of
$3,500.00 for each assignment. In the case of a participation, the
participant shall only have the rights specified in Section 9.2.3
[Set-off] (the participant's rights against such Lender in respect of such
participation to be those set forth in the agreement executed by such Lender in
favor of the participant relating thereto and not to include any voting rights,
all of such Lender's obligations under this Agreement or any other Loan Document
shall remain unchanged, and all amounts payable by the Borrower hereunder or
thereunder shall be determined as if such Lender had not sold such
participation.
(b) Any
assignee or participant which is not incorporated under the Laws of the United
States of America or a state thereof shall deliver to the Borrower and the Agent
the form of certificate described in Section 11.18.1
[Tax Withholding] relating to federal income tax withholding. Each
Lender may furnish any publicly available information concerning the Borrower or
its Subsidiaries and any other information concerning the Borrower or its
Subsidiaries in the possession of such Lender from time to time to assignees and
participants (including prospective assignees or participants), provided that such assignees
and participants agree to be bound by the provisions of Section 11.12
[Confidentiality].
(c) Notwithstanding
any other provision in this Agreement, any Lender may at any time pledge or
grant a security interest in all or any portion of its rights under this
Agreement, its Note (if any) and the other Loan Documents to any Federal Reserve
Bank in accordance with Regulation A of the FRB or U.S. Treasury Regulation 31
CFR Section 203.14 without notice to or consent of the Borrower or the
Agent. No such pledge or grant of a security interest shall release
the transferor Lender of its obligations hereunder or under any other Loan
Document.
(d) A
bank that is to become a party to this Agreement pursuant to Section
2.11 [Right to Increase Commitments] hereof or otherwise (each an "Additional
Lender") shall execute and deliver to Agent a Lender Joinder to this
Agreement in substantially the form attached hereto as Exhibit 1.1(B). Upon
execution and delivery of a Lender Joinder, such Additional Lender shall be a
party hereto and a Lender under each of the Loan Documents for all purposes,
except that such Additional Lender shall not participate in any Loans to which
the Euro-Rate Option applies that are outstanding on the effective date of such
Lender Joinder. If the Borrower should renew after the effective date
of such Lender Joinder the Euro-Rate Option with respect to Loans existing on
such date, the Borrower shall be deemed to repay the applicable Loans on the
renewal date and then reborrow a similar amount on such date so that the
Additional Lender shall participate in such Loans after such renewal
date. Schedule
1.1(B) shall be amended and restated on the date of such Lender Joinder
to revise the information contained therein as appropriate to reflect the
information on the attachment to such Lender Joinder. Simultaneously
with the execution and delivery of such Lender Joinder, the Borrower shall
execute a Revolving Credit Note, and deliver it to such Additional Lender
together with originals of such other documents described in Section 7.1
[First Loans and Letters of Credit] hereof as such Additional Lender may
reasonably require.
11.12 Confidentiality.
|
11.12.1.
|
General.
|
The Agent
and the Lenders each agree to keep confidential all information obtained from
the Borrower or its Subsidiaries which is nonpublic or otherwise confidential or
proprietary in nature (including any information the Borrower specifically
designates as confidential), except as provided below, and to use such
information only in connection with their respective capacities under this
Agreement and for the purposes contemplated hereby. The Agent and the
Lenders shall be permitted to disclose such information (a) to outside
legal counsel, accountants and other professional advisors who need to know such
information in connection with the administration and enforcement of this
Agreement, subject to agreement of such Persons to maintain the confidentiality,
(b) to assignees and participants as contemplated by Section 11.11
[Successors and Assignors; Joinder of a Lender], and prospective assignees and
participants, provided that prior to such
disclosure, such parties agree in writing to be bound by this undertaking of
confidentiality set forth in this Section
11.12, (c) to the extent requested by any bank regulatory authority
or, with notice to the Borrower, as otherwise required by applicable Law or by
any subpoena or similar legal process, or in connection with any investigation
or proceeding arising out of the transactions contemplated by this Agreement,
(d) if it becomes publicly available other than as a result of a breach of
this Agreement or becomes available and is not reasonably known to be subject to
confidentiality restrictions, or (e) if the Borrower shall have consented
to such disclosure.
|
11.12.2.
|
Sharing Information
With Affiliates of the
Lenders.
|
The
Borrower acknowledges that from time to time financial advisory, investment
banking and other services may be offered or provided to the Borrower or one or
more of its Affiliates (in connection with this Agreement or otherwise) by any
Lender or by one or more Subsidiaries or Affiliates of such Lender and the
Borrower hereby authorizes each Lender to share any information delivered to
such Lender by the Borrower and its Subsidiaries pursuant to this Agreement, or
in connection with the decision of such Lender to enter into this Agreement, to
any such Subsidiary or Affiliate of such Lender, it being understood that any
such Subsidiary or affiliate of any Lender receiving such information shall be
bound by the provisions of Section
11.12.1
[General] as if it were a Lender hereunder. Such authorization shall
survive the repayment of the Loans and other Obligations and the termination of
the Commitments.
11.13 Counterparts.
This
Agreement may be executed by different parties hereto on any number of separate
counterparts, each of which, when so executed and delivered, shall be an
original, and all such counterparts shall together constitute one and the same
instrument.
11.14 The Agent's or the Lenders'
Consent.
Whenever
the Agent's or any Lender's consent is required to be obtained under this
Agreement or any of the other Loan Documents as a condition to any action,
inaction, condition or event, the Agent and each Lender shall be authorized to
give or withhold such consent in its sole and absolute discretion and to
condition its consent upon the giving of additional collateral, the payment of
money or any other matter.
11.15 Exceptions.
The
representations, warranties and covenants contained herein shall be independent
of each other, and no exception to any representation, warranty or covenant
shall be deemed to be an exception to any other representation, warranty or
covenant contained herein unless expressly provided, nor shall any such
exceptions be deemed to permit any action or omission that would be in
contravention of applicable Law.
11.16 WAIVER OF JURY
TRIAL.
THE
BORROWER, THE AGENT AND THE LENDERS HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR
COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER
LOAN DOCUMENT OR ANY COLLATERAL, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING,
WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR
ACTIONS OF THE AGENT OR THE BANKS RELATING TO THE ADMINISTRATION OF THE LOANS OR
ENFORCEMENT OF THIS AGREEMENT OR THE LOAN DOCUMENTS, TO THE FULLEST EXTENT
PERMITTED BY LAW. THE BORROWER WILL NOT SEEK TO CONSOLIDATE ANY SUCH
ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN
WAIVED. THE BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF THE AGENT OR THE LENDERS, HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT AGENT OR THE LENDERS WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT
FOR THE AGENT AND THE LENDERS TO ACCEPT THIS AGREEMENT AND THE LOAN DOCUMENTS
AND MAKE THE LOANS.
11.17 JURISDICTION AND
VENUE.
THE
BORROWER HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF COURTS
IN THE COUNTY OF MIDDLESEX IN THE STATE OF NEW JERSEY AND THE UNITED STATES
DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY, AND WAIVES PERSONAL SERVICE OF
ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE
MADE BY CERTIFIED OR REGISTERED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO THE
BORROWER AT THE ADDRESSES PROVIDED FOR IN SECTION 11.6 [NOTICES;
LENDING OFFICES] AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON ACTUAL
RECEIPT THEREOF. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF
THE AGENT TO SERVE LEGAL PROCESS BY ANY OTHER MANNER PERMITTED BY
LAW. THE BORROWER IRREVOCABLY WAIVES ANY OBJECTION TO JURISDICTION
AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS PROVIDED HEREIN AND AGREES NOT
TO ASSERT ANY DEFENSE BASED ON FORUM NON CONVENIENS
OR ANY LACK OF JURISDICTION OR VENUE THAT IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT.
11.18 Certifications From Lenders
and Participants.
|
11.18.1.
|
Tax
Withholding.
|
Each
Lender or assignee or participant of a Lender that is not incorporated under the
laws of the United States of America or a state thereof (and, upon the written
request of the Agent, each other Lender or assignee or participant or a Lender)
agrees that it will deliver to each of the Borrower and the Agent two (2) duly
completed, appropriate, valid Withholding Certificates (as defined under
§1.1441-1(c)(16) of the Income Tax Regulations (the "Regulations"))
certifying its status (i.e., United States or
foreign person) and, if appropriate, making a claim of reduced, or exemption
from, United States withholding tax on the basis of an income tax treaty or an
exemption provided by the Internal Revenue Code. Such delivery may be
made by electronic transmission as described in §1.1441-1(e)(4)(iv) of the
Regulations if the Agent establishes an electronic delivery
system. The term "Withholding Certificate" means a Form W-9; a Form
W-8BEN; a Form W-8ECI; a Form W-81MY and the related statements and
certifications as required under §1.1441-1(e)(3) of the Regulations; a statement
described in §1.871-14(c)(2)(v) of the Regulations; or any other certificates
under the Internal Revenue Code or Regulations that certify or establish the
status of a payee or beneficial owner as a United States or foreign
person. Each Lender, assignee or participant required to deliver to
the Borrower and the Agent a valid Withholding Certificate pursuant to the
preceding sentence shall deliver such valid Withholding Certificate as
follows: (a) each Lender which is a party hereto on the Closing
Date shall deliver such valid Withholding Certificate at least five (5) Business
Days prior to the first date on which any interest or Fees are payable by the
Borrower hereunder for the account of such Lender; (b) each assignee or
participant shall deliver such valid Withholding Certificate at least five (5)
Business Days before the effective date of such assignment or participation
(unless the Agent in its sole discretion shall permit such assignee or
participant to deliver such Withholding Certificate less than five (5) Business
Days before such date in which case it shall be due on the date specified by the
Agent). Each Lender, assignee or participant which so delivers a
valid Withholding Certificate further undertakes to deliver to each of the
Borrower and the Agent two (2) additional copies of such Withholding Certificate
(or a successor form) on or before the date that such Withholding Certificate
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent Withholding Certificate so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Agent. Notwithstanding the
submission of a Withholding Certificate claiming a reduced rate of, or exemption
from, United States withholding taxes, the Agent shall be entitled to withhold
United States federal income taxes at the full 30% withholding rate if in its
reasonable judgment it is required to do so under the due diligence requirements
imposed upon a withholding agent under §1.1441-7(b) of the
Regulations. Further, the Agent is indemnified under §1.1461-1(e) of
the Regulations against any claims and demands of any Lender or assignee or
participant of a Lender for the amount of any tax it deducts and withholds in
accordance with regulations under §1441 of the Internal Revenue
Code.
|
11.18.2.
|
USA Patriot
Act.
|
Each
Lender or assignee or participant of a Lender that is not incorporated under the
laws of the United States of America or a state thereof (and is not excepted
from the certification requirement contained in Section 313 of the USA Patriot
Act and the applicable regulations because it is both (a) an affiliate of a
depository institution or foreign bank that maintains a physical presence in the
United States or foreign county, and (b) subject to supervision by a
banking authority regulating such affiliated depository institution or foreign
bank) shall deliver to the Agent the certification, or, if applicable,
recertification, certifying that such Lender is not a "shell" and certifying to
other matters as required by Section 313 of the USA Patriot Act and the
applicable regulations: (i) within 10 days after the Closing Date, and
(ii) as such other times as are required under the USA Patriot
Act.
[SIGNATURE
PAGES FOLLOW]
PRN
376736/8
[SIGNATURE
PAGE 1 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
IN
WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed this Agreement as of the day and year first above
written.
|
ATTEST:
|
NEW JERSEY NATURAL GAS
COMPANY
|
By:
Name: Name:
Title: Title:
[SIGNATURE
PAGE 2 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
PNC
BANK, NATIONAL ASSOCIATION,
|
|
|
individually
and as Agent
|
By: /s/Edward M. Tessalone
Name: Edward M. Tessalone
Title: Senior Vice
President
[SIGNATURE
PAGE 3 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
JPMORGAN CHASE BANK,
N.A., as a Lender and as Syndication
Agent
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
[SIGNATURE
PAGE 4 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
TORONTO DOMINION (NEW YORK)
LLC, as a Lender and as a Documentation
Agent
|
By: /s/Debbi L.
Brito
Name: Debbi L. Brito
Title: Authorized
Signatory
[SIGNATURE
PAGE 5 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
U.S. BANK NATIONAL
ASSOCIATION, as a Lender and as a Documentation
Agent
|
|
By:
|
/s/Eric Cosgrove |
|
|
Name:
Eric Cosgrove
|
|
|
Title:
Vice President
|
[SIGNATURE
PAGE 6 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
WACHOVIA BANK, NATIONAL
ASSOCIATION, as a Lender
|
|
By:
|
/s/James T. King |
|
|
Name:
James T. King
|
|
|
Title:
Senior Vice President
|
[SIGNATURE
PAGE 7 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
SOVEREIGN BANK, as a
Lender
|
By: /s/Dennis De
Vito
Name: Dennis De Vito
Title: Vice President
[SIGNATURE
PAGE 8 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
THE NORTHERN TRUST
COMPANY,
|
|
|
as
a Lender
|
By: /s/Andrew
Holtz
Name: Andrew Holtz
Title:
[SIGNATURE
PAGE 9 OF 9 TO THE NEW JERSEY NATURAL
GAS
COMPANY CREDIT AGREEMENT]
|
|
THE BANK OF NEW YORK
MELLON,
|
|
|
as
a Lender
|
By: /s/Richard
K. Fronapfel
Name: Richard K.
Fronapfel
Title: Vice President
SCHEDULE
1.1(A)
Pricing
Grid
|
Level
|
Debt
Rating
Standard
& Poor's and Moody's
|
Commitment
Fee
|
Base
Rate Spread
|
Euro-Rate
Spread
|
Letter
of Credit Fee
|
|
I
|
A
or above
or
A2
or above
|
0.35%
|
1.00%
|
2.00%
|
2.00%
|
|
II
|
A-
or above but less than A
or
A3
or above but less than A2
|
0.40%
|
1.25%
|
2.25%
|
2.25%
|
|
III
|
BBB+
or above but less than A-
or
Baa1
or above but less than A3
|
0.45%
|
1.50%
|
2.50%
|
2.50%
|
|
IV
|
BBB
or less
or
Baa2
or less
or
unrated
|
0.50%
|
2.00%
|
3.00%
|
3.00%
|
For
purposes of determining the Applicable Margin, the Applicable Commitment Fee
Rate and the Applicable Letter of Credit Fee Rate:
(a) With
respect to the Debt Ratings of Moody's and Standard & Poor's or such other
rating agency (or agencies) that may from time to time be determining Borrower's
Debt Rating pursuant to the terms of the Credit Agreement to which this Schedule
is attached (each, an "Applicable
Rating Agency" and, collectively, the "Applicable
Rating Agencies"): (i) if one or both of such Applicable Rating
Agencies shall fail to have a Debt Rating in effect, then such Applicable Rating
Agency which fails to have a Debt Rating in effect shall be deemed to have
established a Debt Rating at Level IV; and (ii) if the Debt Rating
established by one Applicable Rating Agency and the Debt Rating established by
another Applicable Rating Agency differ, the pricing Level above shall be
determined based upon the higher of the Debt Ratings established by the
Applicable Rating Agencies, provided, however, if one of
the Debt Ratings is two or more Levels lower than the other, the applicable
pricing Level shall be determined at the Level next above that of the Level of
the lower of the two Debt Ratings.
(b) Any
change in the Applicable Margin, the Applicable Commitment Fee Rate, or the
Applicable Letter of Credit Fee Rate shall become effective on the date of any
public announcement of the change in the Debt Rating requiring such an increase
or decrease.
SCHEDULE
1.1(B)
COMMITMENTS
OF LENDERS AND ADDRESSES FOR NOTICES
Part
1 - Commitments/Addresses of Lenders
|
LENDER
|
AMOUNT
OF COMMITMENT FOR REVOLVING CREDIT LOANS
|
PERCENTAGE
|
|
PNC
BANK, NATIONAL ASSOCIATION
Address
for Notices:
Two
Tower Center Boulevard
East
Brunswick, NJ 08816
Attention:
Edward M. Tessalone
Telephone
No. (732) 448-2886
Telecopier
No. (732) 220-3503
E-mail:
edward.tessalone@pnc.com
Address
of Lending Office:
PNC
Firstside Center, 3rd Floor
500
First Ave.
Pittsburgh,
PA 15219
Attention:
Rini Davis
Telephone
No. (412) 762-7638
Telecopier
No. (412) 762-8672
E-mail:
rini.davis@pnc.com
|
$40,000,000.00
|
20.000000000%
|
|
JPMORGAN
CHASE BANK, N.A.
Address
for Notices:
10
S. Dearborn St., Floor 9
Mail
code: IL1-0090
Chicago,
Illinois 60603
Attention:
Jennifer Fitzgerald
Telephone
No. (312) 732-1754
Telecopier
No. (312) 732-1762
E-mail:
jennifer.e.fitzgerald@jpmorgan.com
Address
of Lending Office:
10
S. Dearborn St., Floor 9
Mail
code: IL1-0090
Chicago,
Illinois 60603
Attention:
Non-Agent Servicing Team
Telephone
No. (312) 385-7072
Telecopier
No. (312) 256-2608
E-mail:
cls.chicago.non.agented.servicing@chase.com
|
$30,000,000.00
|
15.000000000%
|
|
TORONTO
DOMINION (NEW YORK) LLC
Address
for Notices:
TD
Securities
77
King Street, West RTT, 18th Floor
Toronto,
Ontario M5K 1A2
Attention:
Ruth Bengo
Telephone
No.: (416) 590-4350
Telecopier
No.: (416) 590-4335
E-mail:
ruth.bengo@tdsecurities.com
Address
of Lending Office:
31
West 52nd Street
22nd
Floor
New
York, New York 10019
Attention:
Telephone
No.:
Telecopier
No.:
E-mail:
|
$30,000,000.00
|
15.000000000%
|
|
U.S.
BANK NATIONAL ASSOCIATION
Address
for Notices:
U.S.
Bank Tower
425
Walnut Street, 8th Floor
ML
CN-W-8
Cincinnati,
OH 45202
Attention:
Eric J. Cosgrove, VP,
National
Corporate Banking
Telephone
No. (513) 632-3033
Telecopier
No. (513) 632-2068
E-mail:
Eric.Cosgrove@USBank.com
Address
of Lending Office
425
Walnut Street, 8th Floor
ML
CN-OH-W8
Cincinnati,
OH 45202
Attention:
Eric J. Cosgrove, VP,
National
Corporate Banking
Telephone
No. (513) 632-3033
Telecopier
No. (513) 632-2068
E-mail:
Eric.Cosgrove@USBank.com
|
$30,000,000.00
|
15.000000000%
|
|
WACHOVIA
BANK, NATIONAL
ASSOCIATION
Address
for Notices:
32
E. Front Street, 4th Floor
Trenton,
NJ 08608
Attention:
James T. King
Telephone
No. (609) 826-8538
Telecopier
No.
E-mail:
james.t.king@wachovia.com
Address
of Lending Office:
_____________________________
_____________________________
Attention:
Specialized Loans
Telephone
No. (866) 647-7249
Telecopier
No. (704) 715-0099
E-mail:
james.t.king@wachovia.com
|
$25,000,000.00
|
12.500000000%
|
|
SOVEREIGN
BANK
Address
for Notices:
619
Alexander Road
Princeton,
NJ 08540
Attention:
Dennis DeVito
Telephone
No. (609) 243-6182
Telecopier
No. (609) 243-7513
E-mail:
ddevito@sovereignbank.com
Address
of Lending Office:
____________________________
_____________________________
Attention: Deb
Santiago
Telephone
No.: (610) 378-6693
Telecopier
No.: (610) 378-6715
E-mail:
participations@sovereignbank.com
|
$20,000,000.00
|
10.000000000%
|
|
THE
NORTHERN TRUST COMPANY
Address
for Notices:
50
South LaSalle Street MB-27
Chicago,
IL 60603
Attention:
Andrew Holtz
Telephone
No. (312) 444-4243
Telecopier
No. (312) 444-4906
E-mail:
adh11@ntrs.com
Address
of Lending Office:
50
S. LaSalle Street
MB-27
Chicago,
IL 60603
Attention:
Sharon Jackson
Telephone
No.: (312) 630-1609
Telecopier
No.: (312) 630-1566
E-mail: smj@ntrs.com
|
$15,000,000.00
|
7.500000000%
|
|
THE
BANK OF NEW YORK MELLON
Address
for Notices:
One
Wall Street, 19th Floor
New
York, NY 10286
Attention:
Richard K. Fronapfel
Telephone
No. (212) 635-7615
Telecopier
No. (212) 635-8595
E-mail:
richard.fronapfel@bnymellon.com
Address
of Lending Office:
6023
Airport Rd.
Oriskany,
NY 13424
Attention: Melissa
Morgan
Telephone
No.: (315) 765-4390
Telecopier
No.: (315) 765-4782
E-mail:
melissa.m.morgan@bnymellon.com
|
$10,000,000.00
|
5.000000000%
|
|
Total
|
$200,000,000.00
|
100.000000000%
|
SCHEDULE
1.1(B)
COMMITMENTS
OF LENDERS AND ADDRESSES FOR NOTICES
Part
2 - Addresses for Notices to Administrative Agent, Borrower:
ADMINISTRATIVE
AGENT:
Name: PNC BANK, NATIONAL
ASSOCIATION
|
Address:
|
Two
Tower Center Boulevard
|
|
|
East
Brunswick, NJ 08816
|
|
Attention:
|
Edward
M. Tessalone
|
|
|
Telephone
No. (732) 448-2886
|
Telecopier
No. (732) 220-3503
|
E-mail:
|
edward.tessalone@pnc.com
|
With
a Copy to:
Name PNC BANK, NATIONAL
ASSOCIATION
Address: PNC
Firstside Center, 3rd Floor
500 First Ave.
Pittsburgh, PA 15219
Attention: Rini
Davis
Telephone: (412)
762-7638
Telecopy: (412)
762-8672
E-mail: rini.davis@pnc.com
BORROWER:
Name: NEW JERSEY NATURAL GAS
COMPANY
Address: 1415
Wyckoff Road
Wall, NJ 07719
Attention: William
Foley, Treasurer
Telephone: (732)
938-1224
Telecopy: (732)
938-3154
E-mail: wfoley@njresources.com
|
Schedule 1.1(P): New Jersey Natural Gas
Company
Permitted Liens
|
|
None.
|
|
Schedule 2.9.1: New Jersey Natural Gas
Company
Existing Letters of Credit
|
|
None
|
|
Schedule 6.1.2: New Jersey Natural Gas
Company
Subsidiaries
|
|
None
|
|
Schedule 6.1.12: New Jersey Natural Gas
Company
Consents and Approvals
|
|
Pursuant
to N.J.S.A. 48:3-9, NJNG petitioned the New Jersey Board of Public
Utilities for authorization to enter into the Agreement and NJNG received
such authorization on December 1,
2009.
|
|
Schedule 6.1.23: New Jersey Natural Gas
Company
Hedging Contract
Policies
|
|
Attached.
|
Revised: May
12,
2009 Approved
By: NJNG Risk Management Committee
|
I.
|
Objectives of the Risk
Management Committee’s Guidelines and
Procedures
|
The Board
of Directors of New Jersey Resources Corporation (“NJR”) has delegated
responsibility for risk management with regard to wholesale gas trading, credit
risk, and overall hedging activities of New Jersey Natural Gas (“NJNG” or the
“Company”) to the Audit Committee of NJR’s Board of Directors (“Audit
Committee”). The Audit Committee has established and authorized the
Risk Management Committee (“RMC”) to develop, implement, and enforce risk
management procedures for NJNG, consistent with NJNG’s Risk Management
Policy.
The
following Guidelines and Procedures have been developed in order to fulfill the
responsibilities delegated to the RMC by the Audit Committee. The RMC’s
Guidelines and Procedures are intended to be a working document and will be
updated on an ongoing basis to reflect the changing business environment
encountered by NJNG.
|
II.
|
Operating Guidelines
for the Risk Management
Committee
|
The RMC
is comprised of six senior management representatives as appointed by NJR's
Chairman and Chief Executive Officer. The RMC is comprised
of:
|
·
|
Glenn
Lockwood - Senior Vice President & CFO of NJR (RMC
Chairperson)
|
|
·
|
Joseph
Shields - Senior Vice President, Energy Services
NJNG
|
|
·
|
Mark
Sperduto - Vice President, Regulatory Affairs of
NJNG
|
|
·
|
Mariellen
Dugan – Senior Vice President & General Counsel of
NJR
|
|
·
|
William
Foley - Treasurer of NJR
|
|
·
|
William
Scharfenberg – Senior Counsel
|
Additionally,
NJR's Vice President of Internal Auditing and/or audit staff are invited to
attend all meetings of the RMC as a non-voting but participating
member.
The RMC
will meet at least twice each month. Any member of the RMC may
request that a meeting be held. A quorum (consisting of three members
of the RMC) must be present to conduct an RMC meeting. All official
actions of the RMC will require the affirmative vote of three members of the
RMC. Meeting minutes will be prepared by the Manager, Mid-Office
Controls, for each meeting. All approved RMC meeting minutes will be
forwarded to the Vice President of Internal Auditing, who is responsible for
forwarding the approved RMC minutes and related materials to the Audit Committee
regularly.
The
Manager, Mid-Office Controls will be responsible for reviewing NJNG’s risk
management reports on a daily or weekly basis, depending on the
report. These reports include mark-to-market of open positions, daily
broker statement, pricing data, trader limit exception report, and counterparty
deal compare report. In addition to these reports, the Manager,
Mid-Office Controls is also responsible for compiling the RMC reports listed in
Section VIII, B, 1 - Risk Monitoring & Reporting, of these
Guidelines.
NJNG’s
Energy Services operating management has the first-line delegated authority to
ensure that NJNG’s business risks are properly identified, measured, controlled,
and reported, using approved methodologies as specified herein.
|
III.
|
Affiliate
Transactions
|
NJNG
transacts in the natural gas commodity, transportation and storage capacity
markets (physical assets), and establishes a position within those markets to
provide sufficient commodity and capacity necessary to meet its customers’
demand levels. An affiliated company, NJR Energy Services (“NJRES”),
also acquires physical assets and transacts in natural gas transportation and
storage capacity markets.
On a
daily basis, both companies (NJNG and NJRES) buy and sell physical assets within
the same market place. In light of that, controls have been developed to oversee
activities to ensure that each company’s strategies, techniques and transactions
comply with applicable regulations and policies. On a monthly basis, the RMC is
provided with an internal control addendum that includes reports designed to
monitor potential affiliate transactions. These reports were
developed in accordance with the BPU audit report (dated 11/20/07); section I-5
“Affiliate Procurement Relationships”.
The NJR
“Code of Conduct” (Exhibit III) also addresses affiliate
transactions.
|
IV.
|
Overview of NJNG’s
Business Activities
|
NJNG is a
wholly owned subsidiary of NJR and is engaged in providing regulated natural gas
energy services to customers located in central and northern New Jersey, as well
as, providing other energy-related services throughout various geographic
regions in which NJNG has gas transportation and/or storage capacity
rights. The following summarizes NJNG’s core business
activities.
Basic Gas Supply
Service (BGSS) - NJNG provides natural gas service to a specified core
customer base in New Jersey. To be able to fulfill its obligation to serve this
market, NJNG maintains a portfolio of supply, transportation and storage
contracts. The costs associated with holding this portfolio are currently filed
for recovery in rates through the BGSS factor that must be approved by the New
Jersey Board of Public Utilities (“Board” or the “BPU”). Although the Company’s
price risk within this portfolio is currently mitigated by the rates established
through the BGSS process, NJNG is proactive in its portfolio management approach
and is conscious of hedging its gas costs to attempt to keep prices and
volatility as low as possible.
Prior to
April 1 of each year, the Company will determine the estimated firm purchase
requirements for at least the next two annual BGSS periods. The
volume targets will be updated based upon the annual budget forecast issued in
May or June each year. Along with this, a determination is made of
the average rates necessary to recover the gas costs with a minimal impact on
un-recovered gas costs, when compared to the currently approved BGSS
rate.
The
Company will then devise a strategy to hedge (but not necessarily fix) the gas
purchase requirements. The strategy will provide that at least 75% of
the current winter volumes and 25% of the following year volumes be hedged by
November 1 of the current year. The Company may, at its discretion, hedge
additional volumes. The percentage hedged will consist of storage
gas, all fixed price contracts (future or physical) as well as all long
(purchased) call positions divided by the estimated purchase requirements
including fuel.
Off System Sales
and Capacity Release Program - NJNG’s Off-System Sales and Capacity
Release programs include optimizing the Company’s storage and pipeline capacity
contracts to recover some of the fixed costs within its BGSS
portfolio.
Off
System Sales involves the bundled sales (i.e. the natural gas supply and
transportation capacity) to various end-users and marketers.
The
Capacity Release Program involves the posting of transportation capacity or
storage capacity on the various electronic bulletin boards in compliance with
Federal Energy Regulatory Commission (“FERC”) provider posting requirements for
the sale of capacity to various end-users and marketers when the Company is not
utilizing it (i.e. seasonal demands).
Both
programs have an incentive mechanism, with the reported net revenue generated
shared at eighty five percent (85%) to the customers through a credit to the
BGSS balance and fifteen percent (15%) to the Company.
Storage
Incentive Program
The
Storage Incentive provides benefits to customers through added price stability
and cost reductions. The program establishes a benchmark cost for
storage injections against which actual injection costs are
measured. The program yields cost savings by promoting innovative
purchasing strategies that take advantage of the optionality inherent in storage
operations and marketplace opportunities. The actual costs of storage injections
include commodity costs, actual transportation costs and any gains and losses
associated with trading of financial hedges within the program. The
difference between the Storage Incentive benchmark and actual costs, positive or
negative, are currently shared eighty percent (80%) to customers and twenty
percent (20%) to NJNG. In addition to cost savings, the program
promotes long-term price stability through hedging of storage injection
volumes.
Financial
Risk Management (FRM) Program
The
program is designed to provide price stability and includes an incentive
mechanism designed to encourage the use of financial options to hedge NJNG’s gas
costs. The current sharing percentages on FRM gains are eighty five
percent (85%) to customers and fifteen percent (15%) to NJNG.
V. Business
Risks
NJNG is
subject to a number of ongoing business risks. These risks and the
RMC’s approved strategies to mitigate these risks are identified
below.
|
A.
|
Market Risk
- Market risk represents the potential loss that can be caused by
unfavorable changes in market variables. These variables
include adverse changes in commodity prices and market liquidity and may
occur as a result of positions taken by NJNG in the market or as a result
of market forces outside the control of NJNG. Market risk is
currently mitigated through the BGSS process; in other words, reasonably
incurred gas costs are reflected in the company’s
rates.
|
|
1.
|
General
Trading and Exchange Position Guidelines - The RMC has established
the following guidelines, procedures and trading limits to mitigate NJNG’s
exposure to risks of adverse changes in commodity and capacity market
prices. At its discretion, Management may establish more
restrictive limits than those outlined herein. In addition, the
RMC may, in its discretion, or at the discretion of the Audit Committee,
direct Management to reduce any exposure deemed not in the best interest
of NJNG. The following guidelines apply to all commodity and
capacity transactions for NJNG’s trading
operations.
|
|
a.
|
Market
Exposure - Under the Company’s Off System Sales program, NJNG will
make commitments to purchase or sell commodity, or sell capacity on a
fixed price basis, financial basis or physical
basis.
|
|
b.
|
Use of
Financial Instruments - The use of approved financial instruments
(see Exhibit I) will be used to hedge risks in the physical commodity
market. These derivative instruments can be used to hedge BGSS
or system requirement supply, as well as, for the incentive programs such
as Off-System Sales, Storage Incentive and FRM. The use of
financial instruments for speculative purposes is expressly
prohibited.
|
|
c.
|
Approved
Financial Instruments - Approved financial instruments and
exchanges are listed on Exhibit I. A listing of approved
brokerage houses/financial counterparties with whom NJNG had ISDA
contracts is available for all traders. Approved brokerage
houses/financial counterparties will be required to send confirmations of
all financial trades to the Manager, Mid-Office Control or Accounting
Manager, NJRES. Also, if specifically requested, a copy of the
confirmation must be sent to the Vice President, Internal
Audit.
|
|
d.
|
Managing
Liquidity Risk - Market liquidity may limit NJNG’s ability to
execute transactions rapidly at a reasonable price. The lack of
market liquidity may make it difficult for NJNG to unwind or offset a
particular position at or near a previous market price if there is
inadequate market depth or a disruption in the market. Because
of this risk, the liquidity of certain types of instruments may make them
unsuitable in achieving NJNG’s business objectives. Therefore,
the RMC is to consider this risk when approving the suitability of
specific financial instruments for use by
NJNG
|
|
2.
|
Financial
Risk Management (FRM) Program Guidelines - NJNG was granted
approval by the New Jersey Board of Public Utilities for the FRM program,
which involves utilizing natural gas options to hedge the commodity price
risk within the BGSS supply portfolio. The FRM program also includes an
incentive mechanism on certain transactions, whereby margins are split
eighty five percent (85%) to the customer through a credit to the BGSS
balance and fifteen percent (15%) to the Company. The program is described
in greater detail below.
|
|
a.
|
Benchmark -
The pricing benchmark for the FRM Program is the Global Insight
Natural Gas Monthly Forecast for the Henry Hub. This report is published
by the end of every month and is used to update the FRM benchmark on a
quarterly (Dec, Mar, Jun & Sep) basis. A copy of the Global
Insight Forecast report is provided to the RMC. All executed
trades within the FRM program are measured against the quarterly benchmark
that is in effect at the time of the trade transaction
date.
|
|
b.
|
Portfolio
Volumes - The program has volume limitations relating to the total
monthly BGSS market-based purchases. A report of the volumes is
updated annually on June 1, as part of the annual BGSS
filing. The report lists the volumes that may be hedged
in relation to pricing against the approved
benchmarks.
|
[Missing Graphic Reference]
|
c.
|
Approved
Financial Instruments – Permitted FRM transactions are limited to
options. Naked options, futures contracts and swaps are not
permitted.
|
|
d.
|
Program
Dollar Limitation - The cost associated with the program is capped.
The current cap which may be changed with approval of the BPU is $6.4
million; the current cap was approved by the BPU in the October 3, 2008
Order approving the Stipulation in the base rate case. The $6.4
million includes the premium costs of the options purchased for the
program, NJNG’s 15 percent share, credits from option close, and broker
fees/commissions.
|
Calculations
for the above individual FRM components are as follows:
|
·
|
Option
premium costs – determined based on the premium rate obtained at deal
inception multiplied by the number of option contracts purchased,
multiplied by 10,000 (1 contract = 10,000
dths).
|
|
·
|
NJNG
sharing dollars at 15% – calculated as DRI Benchmark minus Strike Price
minus the premium paid, multiplied by the number of option contracts
purchased times 10,000 dths less fees at purchase, with 15% credited to
NJNG; these sharing dollars are determined at the time the option is
purchased, since both prices are known at deal
inception.
|
|
·
|
Credit
from option close – calculated as Market price (penultimate) minus DRI
Benchmark; these amounts are not determined until option settlement date
when the penultimate price becomes available. Additionally,
only resulting gains (and not losses) are applied as a credit to the
program dollars.
|
|
·
|
Broker
fees/commissions – flat individual rate per
contract.
|
|
e.
|
Authorized
Financial Brokerage Accounts - The RMC has approved two financial
brokerage accounts (see Exhibit I).
|
|
f.
|
Below the
Benchmark Sharing - The profit on trades executed below the program
benchmark is calculated as the benchmark minus the strike price minus the
premium and the transaction costs (e.g., broker commissions). Eighty five
percent (85%) of the calculated profit is allocated to the customers as a
credit to the BGSS balance, while fifteen percent (15%) is allocated to
the Company.
|
|
g.
|
Above the
Benchmark Sharing – RMC approval is required for entering into
options above the benchmark. Sharing on trades above the
established benchmark is subject to the market price of the option minus
the transaction costs. Eighty five percent (85%) of the calculated profit
is allocated to the BGSS balance, while fifteen percent (15%) is allocated
to the Company. If the option expires without value in the market, the
premium paid for that option is shared eighty five percent (85%) of the
cost to the BGSS, fifteen percent (15%) to the
Company.
|
|
h.
|
Reporting
- Internally, an update of the FRM Program activity is presented at every
RMC meeting. External reports are prepared monthly for the BPU on a
confidential basis subject to a protective order between NJNG, the
Department of the Public Advocate, Division of Rate Counsel and the
BPU.
|
|
3.
|
Gas
Purchasing and Off-System Sales Trading Guidelines - In addition to
purchasing the physical commodity and capacity necessary to meet NJNG’s
retail sales commitments, NJNG’s traders purchase and sell natural gas and
capacity as part of OSS and capacity release incentive
programs.. The following guidelines apply to
NJNG’s gas supply
operations:
|
Prior to
making any off system sale or capacity release, the NJNG trader must analyze the
availability of any excess deliverability in the portfolio.
|
a.
|
For
daily and within the month transactions: the trader reviews the daily send
out estimate report that is distributed by Gas Control twice a day and
compares it to the daily deliverability available in the
portfolio. If the transaction is greater than the number of
days on the daily send out but still less than 1 month, the trader
requests a balance of month forecast projection from the Manager, Supply
Planning and compares each days’ estimate to the deliverability of the
portfolio.
|
|
b.
|
For
transactions for the prompt month or greater, but not over a peak winter
month (January or February): the trader requests a projected
gas usage by month from the Manager, Supply Planning which shows by month
the current system requirement estimates based on 10-year averages and
current long term weather forecast and compares that to the estimated
portfolio deliverability, inclusive of projected planned storage
injections and/or withdrawals.
|
|
c.
|
For
transactions that might include a peak winter month, then in addition to
the above analysis, the trader must obtain a peak day analysis that shows
potential peak day requirements and the required 5% reserve
volume.
|
After the
determination of any excess deliverability is made, the trader can transact
within the following approval limits.
Trading Approvals
- Traders are authorized to make capacity and commodity trades using the
following volumetric limits:
|
Deal
Term
|
Dths/day
|
|
Daily
|
50,000
|
|
II. Monthly
|
30,000
|
|
Seasonal
|
20,000
|
Seasonal
deal term is defined as Apr-Oct (Summer) period or Nov-Mar (Winter) period. The
Vice President or Senior Vice President of Energy Services, NJNG, must approve
any trades that exceed a seasonal period.
Capacity Release
The
following table summarizes the approvals required for capacity release
transactions:
|
Approval
|
Dths/day
|
Term
*
|
Demand
$
|
|
Traders
|
50,000
|
</=
Seasonal
|
<
$0.2 MM
|
|
V.P.
NJNG
|
>
Seasonal
|
<
$1.0 MM
|
|
|
SVP
ES
|
<
$5.0 MM
|
||
|
CFO/
Treasurer/ VP NJRSC/ COO
|
>
$5.0 MM
|
||
|
CEO
|
>
$ 15.0 MM
|
||
|
Board
of Directors
|
>
$20.0 MM
|
* refers to upcoming season
only
Exhibit
IV – Contract & Credit Policy for Wholesale Transactions provides additional
information regarding the above approvals.
|
a.
|
General
Trading Guidelines - Authorized NJNG traders are subject to
compliance within the established monthly and daily trading strategies
(i.e., monthly and daily “set-up” sheets) as approved by the Vice
President or Senior Vice President, NJNG Energy Services. Any
seasonal trades executed must be in compliance with the winter seasonal
trading strategy approved by the Vice President or Senior Vice President,
NJNG Energy Services.
|
|
b.
|
Transaction
Documentation - All transactions must be documented by a contract
executed by both parties. Physical transactions are commonly
documented by a GISB (Gas Industries Standards Board) or NAESB (North
American Energy Standards Board) base contract for sale and purchase of
natural gas. Financial transactions are commonly documented by
an ISDA (International Standards and Derivatives Association)
contract. More detail concerning contracts can be found in the
Credit and Contract Procedures manual (see Exhibit
IV).
|
In
addition, traders will document all hedges, with note to file, by explaining why
the hedge is being established and reference the applicable program (e.g.,
Storage Incentive).
|
d.
|
Risk
Management - Documentation for all transactions will be in the GMS
(Gas Management System) or Zai*Net systems. The financial
trader will coordinate with the physical traders to determine the risk
management strategy for each transaction or group of transactions with the
intent that all price exposure is to be hedged with a financial instrument
at the time of the physical transaction or the optional trigger price is
executed.
|
|
4.
|
Storage
Incentive Program
|
The
Company has established a target range of 20 - 23 bcf of gas available through
storage as of October 31 each year. Of that quantity, 20 bcf will be
included in the Storage Incentive Program. The Storage Incentive
Program purchase guideline is as follows:
|
#
of Contracts
|
Contract
Month
|
|
286
|
April
|
|
286
|
May
|
|
285
|
June
|
|
286
|
July
|
|
286
|
August
|
|
285
|
September
|
|
286
|
October
|
|
2,000
|
Totals
|
The 20
Bcf will be evenly distributed within the Apr-Oct month period to equal
approximately 285 – 286 contracts per month. The Storage Incentive
program does not specify a starting date to begin hedging. NJNG has
the ability to increase the volume for any new incremental storage capacity that
is added to the portfolio.
NJNG’s
policy is to not hedge beyond the years that the Storage Incentive program is
approved by the BPU.
Note: the
fuel component/hedge is done at the then-applicable rate.
|
B.
|
Credit Risk
- Credit risk is the risk of loss as a result of nonperformance by
NJNG’s counterparties pursuant to the terms of their contractual
obligations. The loss is the cost of replacing the contract
with a new one with identical or similar terms (replacement value) or the
amount of gas delivered but not paid
for.
|
NJNG’s
exchange-traded purchases and sales of natural gas financial contracts do not
contribute to credit risk since each transaction is supported by the NYMEX
Exchange. Any over-the-counter financial transaction would be subject to the
individual counterparty credit risk.
The
Senior Manager, Energy Services is responsible for the credit risk management
function and will have clear independence and authority separate from the
trading function. The Senior Manager’s responsibilities include first-line
evaluation of new counterparties, monitoring and reporting credit exposure,
reviewing the creditworthiness of counter parties, monitoring the concentrations
of credit risk and reviewing and monitoring risk reduction
arrangements. All credit limit increases require approval from
several RMC members, and at least the Senior Vice President, Energy Services
NJNG, and the Vice President & Controller, or Treasurer of
NJR. These responsibilities are further defined in NJR’s Credit and
Contract Policies and Procedures.
|
C.
|
Operational
Risk - Operational risk is the exposure to loss due to human error
or fraud, or from a system of internal controls that fails to adequately
record, monitor and account for transactions or positions. In
addition to the daily and monthly reporting obligations described in
Section VII, NJNG has implemented the following personnel and system
controls to mitigate operational
risks.
|
|
1.
|
Personnel -
The following procedures have been established to safeguard against
personnel risks:
|
|
a.
|
All
personnel who are authorized to contract on behalf of NJNG must be
approved by the RMC. Approved traders with authorized products
to trade are listed in Exhibit II.
|
All
trades that are conducted via telephone will be made with recording devices to
ensure that conversations are captured for evidentiary purposes, in the event of
deal discrepancies. Only specific transaction related information will be
recorded. Voice data containing this information will be kept
consistent with FERC policy.
Trades
that are performed via instant messaging, or on telephones located outside the
office (including cellular phones), will be confirmed via a recorded telephone
line or the instant message will be retained.
|
b.
|
Personnel
involved in risk measurement, validation, and monitoring will have clear
independence and autonomy from the trading
function.
|
|
c.
|
All
employees will be required to sign NJR’s Code of Conduct policy
annually.
|
|
d.
|
All
traders and Transportation & Exchange (T&E) personnel are required
to sign an annual compliance statement indicating that they have read,
understood, and will comply with the RMC’s Guidelines and
Procedures.
|
|
e.
|
No
person will be able to trade for themselves or others using approved
financial instruments during their affiliation with
NJNG. Financial instruments that are approved for use in NJNG’s
risk management operations are listed in Exhibit
I.
|
|
2.
|
Information
System Controls - To minimize operational risk, information systems
controls will be established and implemented with the following design
feature requirements:
|
|
a.
|
Information
systems will be developed and implemented to adequately document, record
and measure all of NJNG’s business transactions and forward
commitments.
|
|
b.
|
Data
access will be controlled and security procedures will be implemented to
properly control data access and update
capabilities.
|
|
c.
|
Contingency
plans will be established with detailed procedures for backup (timely,
adequate, off-site rotation to secure location, etc.) of mission-critical
applications.
|
|
D.
|
Legal Risk
- Legal risk is the risk of loss when a contract cannot be enforced
or a counterparty fails to fulfill its contractual
obligations. This includes risks arising from insufficient
documentation, insufficient authority of a counterparty, uncertain
legality, and unenforceability due to bankruptcy or
insolvency.
|
To
minimize the risks of failure of NJNG’s counterparties to perform their
contractual obligations, NJR’s legal counsel must approve all contracts as per
the Contract and Credit Guidelines (see Exhibit IV).
|
E.
|
Tax Risk
- Tax risk is the financial risk arising from possible
misinterpretations or changes in the federal or state tax
laws. To minimize this risk, NJR’s tax department monitors
federal and state tax laws affecting NJNG’s business
operations. In addition, Management is required to notify NJR’s
tax department prior to conducting business in a new tax jurisdiction
(i.e., country, federal, state or
city).
|
|
VI.
|
Required
Notifications
|
Changes
in Management’s business strategies, changes in the business environment that
materially impact NJNG’s risk profile and any violation of the RMC’s guidelines
and procedures are required to be immediately reported to the RMC. If
a violation involves the failure of the RMC to comply with its oversight
responsibilities, the violation must also be immediately reported to the Audit
Committee. Required notifications to the RMC and the Audit Committee
include, but are not limited to, the following events:
|
A.
|
Required
Notifications by Management to the RMC - The RMC is to be
immediately notified when any of the following occur or are expected to
occur:
|
|
1.
|
There
is any incident of trader misconduct or a trader has exceeded his or her
trading limit, without consent from an approving
party.
|
|
2.
|
NJNG’s
FRM Program dollar limitation exceeds the approved limit of
$6,400,000.
|
|
3.
|
There
is a material credit failure or nonperformance by counterparty or clearing
broker.
|
|
4.
|
There
is a change in any risk management methodology or a material change in any
measurement process.
|
|
5.
|
Significant
market changes have occurred or are reasonably expected to occur that
would adversely affect NJNG’s risk management
strategy.
|
|
6.
|
There
is a change in Management’s fundamental strategy with respect to any of
NJNG’s business activities.
|
|
7.
|
Trading
occurs on an exchange or of a new product or instrument that is not listed
in Exhibit I;
|
|
8.
|
A
loss has occurred that would materially impact the financial position or
results of NJNG or NJR.
|
|
B.
|
Required
Notification by the RMC to the Audit Committee - The Audit
Committee is to be notified by the RMC when any of the following
occur.
|
|
1.
|
There
is any incident of trader misconduct or a trader has exceeded his or her
trading limit, without consent from an approving
party.
|
|
2.
|
NJNG’s
FRM Program dollar limitation exceeds the approved limit of
$6,400,000.
|
|
3.
|
There
is a material credit failure or nonperformance by counterparty or clearing
broker.
|
|
4.
|
A
loss has occurred that would materially impact the financial position
or results
of NJNG or NJR.
|
|
C.
|
Notification
Procedures - Should any of the above matters arise such that
notification must be made to the Audit Committee, a written statement of
the matter is to be prepared by the employee making the
observation. A copy of the written statement is to be provided
to:
|
|
·
|
Larry
Downes, President & Chief Executive Officer,
NJNG
|
|
·
|
Glenn
Lockwood, Senior Vice President & CFO of NJR (RMC
Chairperson)
|
|
·
|
Joseph
Shields - Senior Vice President, Energy Services
NJNG
|
|
·
|
Kathy
Ellis – Executive Vice President & Chief Operating Officer,
NJNG
|
|
·
|
Mariellen
Dugan – Sr. Vice President & General
Counsel
|
|
·
|
George
Smith - Vice President of Internal
Audit
|
The
Chairperson of the RMC is to notify the RMC and the Audit Committee if required
by the above procedures.
|
VII.
|
Disciplinary Actions
for Violations of the RMC’s Risk Management
Guidelines
|
The
available disciplinary actions for violations are established by NJNG’s RMC from
time-to-time and are documented herein. Violations not specifically
identified below will be handled at the discretion of the RMC on a case-by-case
basis. All disciplinary actions, whether specifically identified
below or handled at the discretion of the RMC, will be applied on a consistent
and non-discriminatory basis. The
following disciplinary actions apply to violations of the RMC’s guidelines and
procedures:
|
A.
|
Trader
Limit Violations and Trader Misconduct - If a trader exceeds his or
her authorized trading limits without notice, either as the direct result
of a particular trade (“active” excess) or from an adverse market move due
to improper hedging (“passive” excess), or if the trader otherwise
violates the guidelines contained herein, the trader will be issued a
written warning by the Senior Vice President, NJNG Energy Services
documenting the violation. Any trader, who subsequently
violates a limit, regardless of notice, within twelve months of any
previous violation, will be subject to immediate disciplinary action, up
to and including dismissal from employment. The RMC must be
notified immediately of any trader limit violation consistent with the
notification procedures contained
herein.
|
Irrespective
of the guidelines described above, the RMC retains the right to take any
disciplinary action it deems appropriate under the circumstances, whether more
or less severe than the disciplinary actions specified in this
Section.
|
VIII.
|
Risk Monitoring and
Reporting Responsibilities
|
The
following guidelines have been established in order to provide the RMC and
Management with timely and meaningful information to assess the risk exposure of
NJNG and to ensure that NJNG’s business activities are in compliance with the
RMC’s guidelines and procedures.
|
A.
|
Independent
Monitoring - Management is to ensure that there is adequate
segregation of duties between the functions of the front, middle, and back
offices. Personnel involved in risk measurement, validation,
monitoring and reporting are to have the appropriate competencies in
understanding the monitored activity and clear independence and autonomy
from the trading function.
|
NJR
Internal Audit shall perform periodic non-scheduled audits at the discretion of
the Vice President of Internal Audit. The results of these audits
will be provided to the RMC and the Audit Committee after Management has had the
opportunity to review the findings and respond appropriately.
|
B.
|
Management’s
Responsibility to Report to the RMC - Management will provide
periodic reports to the RMC. The RMC designates the Manager, Mid-Office
Control with the first-line responsibility for monitoring and reporting on
NJNG’s adherence to the established procedures and trading
limits.
|
|
1.
|
Required
Reporting from Management to the RMC - The following reports will
be produced for each RMC meeting by assigned personnel and are to be
reviewed by the Manager, Mid-Office
Control.
|
|
RMC
Report
|
|
NJNG
BGSS
|
|
NJNG
Hedging Summary
|
|
NJNG
Storage Incentive Summary
|
|
NJNG
Forward Market Equity
|
|
NJNG
FRM Program
|
|
NJNG
FRM Supplemental
|
|
NJNG/NJREC
Coastal Swap
|
|
Credit
Information Change Report
|
|
Available
Credit Report
|
|
Credit
Exposure
|
|
Ratings
changes
|
The
following additional reports addressing internal controls are included as an
addendum to the first RMC meeting of each month:
|
Affiliate-trade
reporting
|
|
Un-used
capacity report (annually)
|
|
Option
premiums
|
|
Trader
limit report
|
|
Top
10 counterparties ($’s and Dth’s)
|
|
Top
10 trades ($’s and Dth’s)
|
|
C.
|
RMC’s
Responsibility to Report to the Audit Committee - The Chairperson
of the RMC will provide a verbal report at each meeting of the Audit
Committee summarizing any of NJNG’s activities that affect its risk
management profile or risk exposure. Additionally, minutes of
all RMC meetings will be provided to the Audit Committee
regularly.
|
|
III.
|
EXHIBIT
I
|
APPROVED
FINANCIAL INSTRUMENTS, BROKERAGE HOUSES, FINANCIAL COUNTERPARTIES AND
EXCHANGES
Approved
Financial Instruments:
Natural gas futures
contracts
Natural gas options
contracts
Natural gas basis swaps
Natural gas commodity
swaps
Approved
Exchanges:
New York Mercantile
Exchange
Intercontinental Exchange
Approved
Futures Commission Merchants:
Citigroup
Global Markets, Inc. (formerly Salomon Smith Barney)
Newedge
Financial (formerly Calyon Financial)
Approved
Counterparties:
Refer to
GMS (Contract Summary)
|
Schedule 6.1.24: New Jersey Natural Gas
Company
Permitted Related Business
Opportunities
|
|
None.
|
|
Schedule 8.2.1: New Jersey Natural Gas
Company
Existing Indebtedness
|
|||||
|
($000)
|
Rate
|
Maturity Date
|
Principal Amount
|
||
|
First Mortgage Bonds
|
|||||
|
Series
AA
|
Var.
|
8/1/30
|
25,000
|
||
|
Series
BB
|
Var.
|
8/1/30
|
16,000
|
||
|
Series
CC
|
6.88%
|
10/1/10
|
20,000
|
||
|
Series
DD
|
Var.
|
9/1/27
|
13,500
|
||
|
Series
EE
|
Var.
|
1/1/28
|
9,545
|
||
|
Series
FF
|
Var.
|
1/1/28
|
15,000
|
||
|
Series
GG
|
Var.
|
4/1/33
|
18,000
|
||
|
Series
HH
|
5.00%
|
12/1/38
|
12,000
|
||
|
Series
II
|
4.50%
|
8/1/23
|
10,300
|
||
|
Series
JJ
|
4.60%
|
8/1/24
|
10,500
|
||
|
Series
KK
|
4.90%
|
10/1/40
|
15,000
|
||
|
Series
LL
|
5.60%
|
5/15/18
|
125,000
|
||
|
Sub-total
First Mortgage Bonds
|
289,845
|
||||
|
Other
|
|||||
|
Capital
Lease Obligation – Bldg
|
24,384
|
||||
|
Capital
Lease Obligation – Meters
|
29,634
|
||||
|
Capital
Lease Obligation – Equipment
|
725
|
||||
|
Commercial
Paper
|
23,000
|
||||
|
Unsecured
Senior Notes (Private
Placement)
|
4.77%
|
3/15/14
|
60,000
|
||
|
TOTAL
|
$427,588
|
||||
EXHIBIT
1.1(A)
FORM
OF
ASSIGNMENT
AND ASSUMPTION
This
Assignment and Assumption Agreement (the "Assignment and
Assumption") is dated as of the Effective Date set forth below and is
entered into by and between [Insert name of Assignor] (the
"Assignor") and
[Insert name of
Assignee] (the "Assignee"). Capitalized
terms used but not defined herein shall have the meanings given to them in the
Credit Agreement identified below (as amended, the "Credit Agreement"),
receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached
hereto are hereby agreed to and incorporated herein by reference and made a part
of this Assignment and Assumption as if set forth herein in full.
For an
agreed consideration, the Assignor hereby irrevocably sells and assigns to the
Assignee, and the Assignee hereby irrevocably purchases and assumes from the
Assignor, subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the Agent as
contemplated below (i) all of the Assignor’s rights and obligations in its
capacity as a Lender under the Credit Agreement and any other documents or
instruments delivered pursuant thereto to the extent related to the amount and
percentage interest identified below of all of such outstanding rights and
Obligations of the Assignor under the respective facilities identified below
(including without limitation any Letters of Credit, guarantees, and Swing Loans
included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any other
right of the Assignor (in its capacity as a Lender) against any Person, whether
known or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause (i)
above (the rights and obligations sold and assigned pursuant to clauses (i) and
(ii) above being referred to herein collectively as, the "Assigned
Interest"). Such sale and assignment is without recourse to
the Assignor and, except as expressly provided in this Assignment and
Assumption, without representation or warranty by the Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________
[and is an Affiliate of [identify Lender1]
3. Borrower(s): New
Jersey Natural Gas Company
4. Agent: PNC
Bank, National Association, as the administrativeagent under the Credit Agreement
5. Credit
Agreement: Credit
Agreement dated as of
December ____, 2009
among New Jersey Natural Gas Company, the Lenders partiesthereto, each syndication agent, each
documentation agent and eachother
titled Lender that may be identified therein, and PNC Bank,National Association, as administrative agent
for the Lenders
6. Assigned
Interest:
|
Facility
Assigned2
|
Aggregate
Amount of Commitment for all Lenders*
|
Amount
of Commitment Assigned*
|
Percentage
Assigned of Commitment3
|
|
$
|
$
|
%
|
|
|
$
|
$
|
%
|
|
|
$
|
$
|
%
|
7. Trade
Date: ______________]4
Effective
Date: _____________ ___, 20___ [TO BE INSERTED BY AGENT AND
WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]5
[SIGNATURE
PAGE FOLLOWS]
2 Fill
in the appropriate terminology for the types of facilities under the Credit
Agreement that are being assigned under this Assignment (e.g. "Revolving Credit
Commitment", etc.)
*
Amount to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Effective
Date.
4 To be
completed if the Assignor and the Assignee intend that the minimum assignment
amount is to be determined as of the Trade Date.
5
Assignor shall pay a fee of $3,500 to the Administrative Agent in connection
with the Assignment and Assumption.
[SIGNATURE
PAGE - ASSIGNMENT AND ASSUMPTION]
The terms
set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
Name:
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:
Name:
Title:
Consented
to and Accepted:
PNC BANK, NATIONAL
ASSOCIATION,
as
Agent
By_____________________________________
Title:
Consented
to:
NEW
JERSEY NATURAL GAS COMPANY,
as
Borrower
By_____________________________________
Title:
ANNEX
1
STANDARD
TERMS AND CONDITIONS
FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and
Warranties.
1.1 Assignor. The
Assignor (a) represents and warrants that (i) it is the legal and beneficial
owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of
any lien, encumbrance or other adverse claim and (iii) it has full power and
authority, and has taken all action necessary, to execute and deliver this
Assignment and Assumption and to consummate the transactions contemplated
hereby; and (b) assumes no responsibility with respect to (i) any statements,
warranties or representations made in or in connection with the Credit Agreement
or any other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Documents or any
collateral thereunder, (iii) the financial condition of the Borrower, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of any Loan
Document or (iv) the performance or observance by the Borrower, any of its
Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.
1.2. Assignee. The
Assignee (a) represents and warrants that (i) it has full power and authority,
and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby and to become
a Lender under the Credit Agreement, (ii) it meets all requirements of an
Assignee under the Credit Agreement (subject to receipt of such consents as may
be required under the Credit Agreement), (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement as a Lender
thereunder and, to the extent of the Assigned Interest, shall have the
obligations of a Lender thereunder, (iv) it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 8.3 thereof, as applicable, 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 Assumption and to
purchase the Assigned Interest on the basis of which it has made such analysis
and decision independently and without reliance on the Agent or any other
Lender, and (v) if Assignee is not incorporated under the Laws of the United
States of America or a state thereof, attached to the Assignment and Assumption
is any documentation required to be delivered by it pursuant to the terms of the
Credit Agreement, duly completed and executed by the Assignee; and (b) agrees
that (i) it will, independently and without reliance on the Agent, the
Assignor or any other Lender, 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 Loan Documents, and (ii) it will
perform in accordance with their terms all of the obligations which by the terms
of the Loan Documents are required to be performed by it as a
Lender.
2. Payments. From
and after the Effective Date, the Agent shall make all payments in respect of
the Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignor for amounts which have accrued to but excluding the
Effective Date and to the Assignee for amounts which have accrued from and after
the Effective Date.
3. General
Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page
of this Assignment and Assumption by telecopy shall be effective as delivery of
a manually executed counterpart of this Assignment and
Assumption. This Assignment and Assumption shall be governed by, and
construed in accordance with, the law of the State of New Jersey.
EXHIBIT
1.1(B)
FORM
OF
LENDER
JOINDER AND ASSUMPTION AGREEMENT
Reference
is made to the Credit Agreement, dated as of December ____, 2009 (as
amended, supplemented, restated or modified from time to time, the "Credit
Agreement"), by and among New Jersey Natural Gas Company, a New Jersey
corporation ("Borrower"), the Lenders now or hereafter party thereto, each
syndication agent, each documentation agent and each other titled Lender that
may be identified therein, and PNC Bank, National Association, in its capacity
as administrative agent for the Lenders (the "Agent").
Agreement
Unless
otherwise defined herein, terms defined in the Credit Agreement (defined above)
are used herein with the same meanings.
______________________________________________________________
(the "New Lender"), intending to be legally bound hereby, joins and becomes a
"Lender" and an "Additional Lender" under the Credit Agreement and each of the
other Loan Documents as of this ______ day of ______________, 20____ (the
"Effective Date") and, pursuant to Section 11.11(d) of the Credit Agreement, the
New Lender hereby agrees as follows:
1. As
of the Effective Date and to the extent of the Revolving Credit Commitment of the New Lender set
forth on Schedule
I hereto: (i) the New Lender hereby agrees that it is and
shall be deemed to be, and it hereby assumes the obligations of, a "Lender" and
an "Additional Lender" under the Credit Agreement and each of the other Loan
Documents; and the New Lender shall be entitled to the benefits, rights,
privileges and remedies of a Lender and an Additional Lender under the Credit
Agreement and each of the other Loan Documents.
2. The
New Lender acknowledges and agrees that the Agent, each other agent under the
Credit Agreement and each Lender makes no representation or warranty and assumes
no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any of the
other Loan Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any of the other
Loan Documents or any other instrument or document furnished pursuant thereto or
(ii) the financial condition of Borrower or the performance or observance
by Borrower of any of its obligations under the Credit Agreement or any of the
other Loan Documents or any other instrument or document furnished pursuant
thereto.
3. The
New Lender (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements (if any) referred to
in Sections 8.3.1 and 8.3.2 of the Credit Agreement, and such other documents
and information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Lender Joinder and Assumption Agreement;
(ii) agrees that it will, independently and without reliance upon the
Agent, any other agent or any Lender 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 Credit Agreement;
(iii) appoints and authorizes the Agent to take such actions on its behalf
and to exercise such powers under the Loan Documents as are delegated to the
Agent by the terms thereof; (iv) agrees that it will become a party to and
be bound by the Credit Agreement on the Effective Date as if it were an original
Lender thereunder and will have the rights and obligations of a Lender
thereunder and will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement are required to be
performed by it as a Lender; and (v) specifies as its address for notices
the office set forth beneath its name on the signature pages
hereof.
4. Following
the execution of this Lender Joinder and Assumption Agreement, it will be
delivered to the Borrower and the Agent for acceptance and for recording by the
Agent.
5. Upon
such acceptance and recording, as of the Effective Date, (i) the New Lender
shall be a party to the Credit Agreement and, to the extent provided in this
Lender Joinder and Assumption Agreement, have the rights and obligations of a
Lender thereunder and under the Loan Documents, and (ii) the Revolving
Credit Commitment of the New Lender shall
be as set forth in Schedule I
hereto.
6. Upon
such acceptance and recording from and after the Effective Date, the Agent shall
make all payments under the Credit Agreement and the Revolving Credit Notes in respect and to the
extent of the interest of the New Lender assumed hereby (including, without
limitation, all payments of principal, interest, Facility Fees and other fees,
costs and expenses with respect thereto) to the New Lender.
7. To
the extent that any Revolving Credit Loans are outstanding as of the Effective
Date, the New Lender shall make Revolving Credit Loans to Borrower on the
Effective Date (and to the extent that any such Loans are subject to the
Euro-Rate Option, only if Borrower shall timely provide a Loan Request after the
Effective Date in accordance with Sections 2.4, 4.1 and 4.2 of the Credit
Agreement to renew such Loan(s) in accordance with Section 11.11(d) of the
Credit Agreement) in an amount such that its share of all Revolving Credit
Loans outstanding
(after giving effect to the Revolving Credit Loans of the New Lender and
assuming that no Lender failed to make Revolving Credit Loans) are in the same
proportion as the Revolving Credit Commitment of the New Lender bears
to the Revolving Credit Commitments of all the Lenders (after giving effect to
the Revolving Credit Commitment of the New
Lender). The Interest Period for each such initial Revolving Credit
Loan made by the New Lender shall equal the remaining Interest Period of each
respective Revolving Credit Loan then outstanding (except
and to the extent such no such Loan Request as aforesaid has been provided by
Borrower with respect to outstanding Loans subject to the Euro-Rate
Option).
8. This
Lender Joinder and Assumption Agreement shall be governed by and construed in
accordance with the laws of the State of New Jersey.
9. This
Lender Joinder and Assumption Agreement may be signed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument; and delivery of executed
signature pages hereof by telecopy transmission from one party to another shall
constitute effective and binding execution and delivery of this Lender Joinder
and Assumption Agreement by such party.
[SIGNATURE
PAGES FOLLOW]
[SIGNATURE PAGE - LENDER JOINDER AND
ASSUMPTION AGREEMENT]
IN
WITNESS WHEREOF, and intending to be legally bound hereby, the New Lender has
duly executed this Lender Joinder and Assumption Agreement and delivered the
same to the Agent and the Borrower as of the Effective Date.
NEW LENDER
__________________________________________
By:
Name:
Title:
Notice
Address:
Telephone
No.:
Telecopier
No.:
Email:
Attention:
CONSENTED TO:
|
|
PNC BANK, NATIONAL
ASSOCIATION, as Agent
|
By:
Name:
Title:
ACKNOWLEDGMENT
AND AGREEMENT OF BORROWER
In
consideration of the foregoing Lender Joinder and Assumption Agreement:
(A) Borrower hereby agrees to execute and deliver to the New Lender a
Revolving Credit Note in respect of the Revolving Credit Commitment of the New Lender, and
(B) Borrower hereby (i) acknowledges and consents to the foregoing
Lender Joinder and Assumption Agreement and agrees that the New Lender shall be
a Lender and an Additional Lender under the Credit Agreement and the other Loan
Documents and shall have the rights, privileges, remedies and obligations of a
Lender and an Additional Lender under the Credit Agreement and under the other
Loan Documents in respect and to the extent of the Revolving Credit
Commitment of the
New Lender set forth on Schedule I hereto,
which information shall be reflected on an amended and restated Schedule 1.1(B)
to the Credit Agreement, and (ii) makes, affirms and ratifies in favor of
the New Lender the Credit Agreement and the other Loan Documents.
BORROWER
|
|
NEW
JERSEY NATURAL GAS COMPANY
|
By: (SEAL)
Name:
Title:
SCHEDULE
I
TO LENDER JOINDER AND
ASSUMPTION AGREEMENT
|
Amount
of Revolving Credit Commitment of New Lender
|
Amount
of Revolving
Credit
Loans of New Lender
|
New
Lender's Revolving Credit Ratable Share of Revolving Credit
Commitments
|
|
$_________
|
$_________
|
__________%
|
EXHIBIT
1.1(R)
FORM
OF
REVOLVING
CREDIT NOTE
$_____________ Princeton,
New Jersey
______________, 2009
FOR VALUE
RECEIVED, the undersigned, NEW
JERSEY NATURAL GAS COMPANY, a New Jersey corporation (herein called the
"Borrower"), hereby promises to pay to the order of ___________________________________
(the "Lender"), the lesser of (i) the principal sum of
__________________________________ Dollars (U.S. $___________), or (ii) the
aggregate unpaid principal balance of all Revolving Credit Loans made by the
Lender to the Borrower pursuant to the Credit Agreement, dated as of the date
hereof, among the Borrower, the Lenders now or hereafter party thereto, each
syndication agent, each documentation agent and each other titled Lender that
may be identified therein, and PNC Bank, National Association, as administrative
agent (hereinafter referred to in such capacity as the “Agent”) (as amended,
restated, modified, or supplemented from time to time, the "Credit Agreement"),
payable on such dates as set forth in the Credit Agreement, with the entire
outstanding balance due and payable by 11:00 a.m. (Pittsburgh time) on the Expiration Date,
together with interest on the unpaid principal balance hereof from time to time
outstanding from the date hereof at the rate or rates per annum specified by the
Borrower pursuant to, or as otherwise provided in, the Credit
Agreement.
Interest
on the unpaid principal balance hereof from time to time outstanding from the
date hereof will be payable on the dates and at the times provided for in the
Credit Agreement. Upon the occurrence and during the continuation of
an Event of Default, the Borrower shall pay interest on the entire principal
amount of the then outstanding Revolving Credit Loans evidenced by this
Revolving Credit Note and all other obligations due and payable to the Lender
pursuant to the Credit Agreement and the other Loan Documents at a rate per
annum as set forth in Section 4.3 of the Credit Agreement. Such
interest rate will accrue before and after any judgment has been
entered.
Subject
to the provisions of the Credit Agreement, payments of both principal and
interest shall be made without setoff, counterclaim, or other deduction of any
nature at the office of the Agent located at One PNC Plaza, 249 Fifth Avenue,
Pittsburgh, Pennsylvania 15222-2707, unless otherwise directed in writing by the
holder hereof, in lawful money of the United States of America in immediately
available funds.
This Note
is one of the Revolving Credit Notes referred to in, and is entitled to the
benefits of, the Credit Agreement and other Loan Documents, including the
representations, warranties, covenants and conditions contained or granted
therein. The Credit Agreement among other things contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for prepayment, in certain circumstances, on account of
principal hereof prior to maturity upon the terms and conditions therein
specified. The Borrower waives presentment, demand, notice, protest
and all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note and the Credit
Agreement.
This Note
shall bind the Borrower and its successors and assigns, and the benefits hereof
shall inure to the benefit of the Lender and its successors and
assigns. All references herein to the "Borrower" and the "Lender"
shall be deemed to apply to the Borrower and the Lender, respectively, and their
respective successors and assigns as permitted under the Credit
Agreement.
This Note
and any other documents delivered in connection herewith and the rights and
obligations of the parties hereto and thereto shall for all purposes be governed
by and construed and enforced in accordance with the internal laws of the State
of New Jersey without giving effect to
its conflicts of law principles.
All
capitalized terms used herein shall, unless otherwise defined herein, have the
same meanings given to such terms in the Credit Agreement.
[SIGNATURE
PAGE FOLLOWS]
[SIGNATURE
PAGE 1 OF 1 TO REVOLVING CREDIT NOTE]
IN
WITNESS WHEREOF, and intending to be legally bound hereby, the undersigned has
executed this Note by its duly authorized officer with the intention that it
constitute a sealed instrument.
|
|
NEW JERSEY NATURAL GAS
COMPANY, a New Jersey
corporation
|
By:
Name:
Title:
(Seal)
EXHIBIT
1.1(S)
FORM
OF
SWING
LOAN NOTE
$20,000,000.00 Princeton,
New Jersey
_________________, 2009
FOR VALUE
RECEIVED, the undersigned, NEW
JERSEY NATURAL GAS COMPANY, a New Jersey corporation (herein called the
"Borrower"), hereby promises to pay to the order of PNC BANK, NATIONAL ASSOCIATION
(the "Lender"), the lesser of (i) the principal sum of Twenty Million
Dollars (U.S. $20,000,000.00), or (ii) the aggregate unpaid principal
balance of all Swing Loans made by the Lender to the Borrower pursuant to the
Credit Agreement, dated as of the date hereof, among the Borrower, the Lenders
now or hereafter party thereto, each syndication agent, each documentation
agent, each other titled Lender that may be identified therein, and PNC Bank,
National Association, as administrative agent (hereinafter referred to in such
capacity as the "Agent") (as amended, restated, modified, or supplemented from
time to time, the "Credit Agreement"), payable on such dates as set forth in the
Credit Agreement, with the entire outstanding balance due and payable by 11:00
a.m. (Pittsburgh time) on the Expiration Date,
together with interest on the unpaid principal balance hereof from time to time
outstanding from the date hereof at the rate or rates per annum specified by the
Borrower pursuant to, or as otherwise provided in, the Credit
Agreement.
Interest
on the unpaid principal balance hereof from time to time outstanding from the
date hereof will be payable on the dates and at the times provided for in the
Credit Agreement. Upon the occurrence and during the continuation of
an Event of Default, the Borrower shall pay interest on the entire principal
amount of the then outstanding Swing Loans evidenced by this Swing Loan Note and
all other obligations due and payable to the Lender pursuant to the Credit
Agreement and the other Loan Documents at a rate per annum as set forth in
Section 4.3 of the Credit Agreement. Such interest rate will accrue
before and after any judgment has been entered.
Subject
to the provisions of the Credit Agreement, payments of both principal and
interest shall be made without setoff, counterclaim, or other deduction of any
nature at the office of the Lender located at One PNC Plaza, 249 Fifth Avenue,
Pittsburgh, Pennsylvania 15222-2707, unless otherwise directed in writing by the
holder hereof, in lawful money of the United States of America in immediately
available funds.
This Note
is the Swing Loan Note referred to in, and is entitled to the benefits of, the
Credit Agreement and other Loan Documents, including the representations,
warranties, covenants and conditions contained or granted
therein. The Credit Agreement among other things contains provisions
for acceleration of the maturity hereof upon the happening of certain stated
events and also for prepayment, in certain circumstances, on account of
principal hereof prior to maturity upon the terms and conditions therein
specified. The Borrower waives presentment, demand, notice, protest
and all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note and the Credit
Agreement.
This Note
shall bind the Borrower and its successors and assigns, and the benefits hereof
shall inure to the benefit of the Lender and its successors and
assigns. All references herein to the "Borrower" and the "Lender"
shall be deemed to apply to the Borrower and the Lender, respectively, and their
respective successors and assigns as permitted under the Credit
Agreement.
This Note
and any other documents delivered in connection herewith and the rights and
obligations of the parties hereto and thereto shall for all purposes be governed
by and construed and enforced in accordance with the internal laws of the State
of New Jersey without giving effect to
its conflicts of law principles.
All
capitalized terms used herein shall, unless otherwise defined herein, have the
same meanings given to such terms in the Credit Agreement.
[SIGNATURE
PAGE FOLLOWS]
[SIGNATURE
PAGE 1 OF 1 TO SWING LOAN NOTE]
IN
WITNESS WHEREOF, and intending to be legally bound hereby, the undersigned has
executed this Note by its duly authorized officer with the intention that it
constitute a sealed instrument.
|
|
NEW JERSEY NATURAL GAS
COMPANY, a New Jersey
corporation
|
By:
Name:
Title:
(Seal)
EXHIBIT
2.4
FORM
OF
LOAN
REQUEST
TO: PNC
Bank, National Association, as Agent
One PNC
Plaza
249 Fifth
Avenue
Pittsburgh,
Pennsylvania 15222
Telephone
No.: (412) 762-7638
Telecopier
No.: (412) 762-8672
Attention: Rini
Davis
FROM: New
Jersey Natural Gas Company (the "Borrower")
|
RE:
|
Credit
Agreement (as it may be amended, restated, modified or supplemented, the
"Agreement") dated as of December ____, 2009 by and among the
Borrower, the Lenders party thereto, each syndication agent, each
documentation agent and each other titled Lender that may be identified
therein, and PNC Bank, National Association, as administrative agent for
the Lenders (the "Agent")
|
Capitalized
terms not otherwise defined herein shall have the respective meanings ascribed
to them by the Agreement.
|
A.
|
Pursuant
to Section 2.4 of the Agreement, the undersigned Borrower irrevocably
requests [check
one
line under 1(a) below and fill in blank space next to the line
as appropriate]:
|
1(a) _____ A
new Revolving Credit Loan
OR
|
|
_____
|
Renewal
of the Euro-Rate Option applicable to an outstanding Revolving Credit Loan
originally made on ____________,
____
|
|
|
OR
|
|
|
_____
|
Conversion
of the Base Rate Option applicable to an outstanding Revolving Credit Loan
originally made on _____________, _____ to a Loan to which the Euro-Rate
Option applies,
|
|
|
OR
|
|
|
_____
|
Conversion
of the Euro-Rate Option applicable to an outstanding Revolving Credit Loan
originally made on ____________, ____ to a Loan to which the Base Rate
Option applies.
|
SUCH NEW,
RENEWED OR CONVERTED LOAN SHALL BEAR INTEREST:
[Check
one line under 1(b) below and fill in blank spaces in line next to
line]:
|
|
1(b)(i)
_____
|
Under
the Base Rate Option. Such Loan shall have a Borrowing Date of
__________, ___ (which date shall be (i) the proposed Borrowing Date,
upon receipt by the Agent by 10:00 a.m. of this Loan Request for
making a new Revolving Credit Loan to which the Base Rate Option applies,
or (ii) the last day of the preceding Interest Period if a Loan to
which the Euro-Rate Option applies is being converted to a Loan to which
the Base Rate Option applies).
|
OR
|
|
(ii)
_____
|
Under
the Euro-Rate Option. Such Loan shall have a Borrowing Date of
_____________ (which date shall be (i) three (3) Business Days after
the Business Day of receipt by the Agent by 10:00 a.m. of this Loan
Request for making a new Revolving Credit Loan to which the Euro-Rate
Option applies, renewing a Loan to which the Euro-Rate Option applies, or
converting a Loan to which the Base Rate Option applies to a Loan to which
the Euro-Rate Option applies.
|
2. Such
Loan is in the principal amount of U.S. $_____________ or the principal amount
to be renewed or converted is U.S. $_____________ [for Revolving Credit Loans under
Section 2.4 not to be less than $3,000,000 and in increments of $1,000,000 for
each Borrowing Tranche to which the Euro-Rate Option applies and not less than
the lesser of $1,000,000 and in integral multiples of $100,000 or the maximum
amount available for each Borrowing Tranche to which the Base Rate Option
applies].
3. [Complete
blank below if the Borrower is selecting the Euro-Rate Option]: Such
Loan shall have an Interest Period of [one, two, three or six] Months.
________________.
|
B.
|
As
of the date hereof and the date of making of the above-requested Loan (and
after giving effect thereto), the Borrower has performed and complied with
all covenants and conditions of the Agreement and the other Loan
Documents; all of the representations and warranties of the Borrower in
the Agreement and in the other Loan Documents are true and correct (except
representations and warranties which expressly relate solely to an earlier
date or time, which representations and warranties were true and correct
on and as of the specific dates or times referred to therein); no Event of
Default or Potential Default has occurred and is continuing or shall
exist; and the making of such Loan shall not contravene any Law applicable
to the Borrower.
|
C. The
undersigned hereby irrevocably requests [check one line under
paragraph 1 below and fill in blank space next to the line as
appropriate]:
1. ______
Funds to be deposited into PNC bank account per our current standing
instructions. Complete amount of deposit if not full loan advance amount: $
_________.
______ Funds to be wired per the
following wire instructions:
$____________________ Amount of Wire
Transfer
Bank
Name:
ABA:
Account
Number:
Account
Name:
Reference:
______ Funds to be wired per the
attached Funds Flow (multiple wire transfers)
|
|
[SIGNATURE
PAGE FOLLOWS]
|
|
|
[SIGNATURE
PAGE 1 OF 1 TO LOAN REQUEST]
|
The
undersigned certifies to the Agent as to the accuracy of the
foregoing.
|
|
NEW JERSEY NATURAL GAS
COMPANY, a New Jersey
corporation
|
Date:
______________,
20__ By: (SEAL)
Name:
Title:
EXHIBIT
2.5
FORM
OF SWING LOAN REQUEST
TO: PNC
Bank, National Association, as Agent
One PNC
Plaza
249 Fifth
Avenue
Pittsburgh,
Pennsylvania 15222
Telephone
No.: (412) 762-7638
Telecopier
No.: (412) 762-8672
Attention: Rini
Davis
FROM: New
Jersey Natural Gas Company (the "Borrower")
|
RE:
|
Credit
Agreement (as it may be amended, restated, modified or supplemented, the
"Agreement") dated as of December ____, 2009 by and among the
Borrower, the Lenders party thereto, each syndication agent, each
documentation agent and each other titled Lender that may be identified
therein, and PNC Bank, National Association, as administrative agent for
the Lenders (the "Agent")
|
Capitalized
terms not otherwise defined herein shall have the respective meanings ascribed
to them by the Agreement.
Pursuant
to Section 2.5 of the Agreement, the undersigned hereby makes the following
Swing Loan Request:
1. Aggregate
Principal Amount of Swing Loans: [amount shall be in integral
multiples of $100,000 and not less than $250,000]U.S. $_________
2. Proposed
Borrowing Date: [this Swing Loan Request must be received by the
Swing Lender by 12:00 noon Pittsburgh time on the proposed Borrowing Date]______________
3. As
of the date hereof and the date of making of the Swing Loan requested hereby:
the representations and warranties of the Borrower contained in Section 6
of the Agreement and in the other Loan Documents are and will be true (except
representations and warranties that expressly relate solely to an earlier date
or time, which representations and warranties were true on and as of the
specific dates or times referred to therein); the Borrower has performed and
complied with all covenants and conditions of the Agreement; no Event of Default
or Potential Default has occurred and is continuing or shall exist; and the
making of the Swing Loan requested hereby shall not contravene any Law
applicable to the Borrower or any of the Lenders.
4. The
undersigned hereby irrevocably requests [check one line under (a)
below and fill in blank space next to the line as appropriate]:
(a) ______
Funds to be deposited into PNC bank account per our current standing
instructions. Complete amount of deposit if not full loan advance amount: $
_________.
______ Funds to be wired per the
following wire instructions:
$____________________ Amount of Wire
Transfer
Bank
Name:
ABA:
Account
Number:
Account
Name:
Reference:
______ Funds to be wired per the
attached Funds Flow (multiple wire transfers)
|
|
[SIGNATURE
PAGE 1 OF 1 TO SWING LOAN REQUEST]
|
The
undersigned hereby certifies the accuracy of the foregoing.
|
|
NEW JERSEY NATURAL GAS
COMPANY, a New Jersey
corporation
|
Date:
______________,
20___ By: (SEAL)
Name:
Title:
--
EXHIBIT
5.5
FORM
OF
COMMITMENT
REDUCTION NOTICE
TO: PNC
Bank, National Association, Agent
One PNC Plaza
249 Fifth Avenue
Pittsburgh, Pennsylvania
15222-2707
Telephone No.: (412)
762-7638
Telecopier No.: (412)
762-8672
Attention: Rini
Davis
FROM: New
Jersey Natural Gas Company (the "Borrower")
|
RE:
|
Credit
Agreement (as amended, restated, supplemented or modified from time to
time, the "Agreement"), dated as of December ____, 2009 by and among
the Borrower, the Lenders party thereto, each syndication agent, each
documentation agent and each other titled Lender that may be identified
therein, and PNC Bank, National Association, as administrative agent for
the Lenders (the "Agent")
|
Capitalized
terms not otherwise defined herein shall have the respective meanings ascribed
to them by the Agreement.
Pursuant
to Section 5.5 of the Agreement, the Borrower irrevocably gives notice
that:
The
Revolving Credit Commitments are reduced as of ____________, 20__ (insert date
at least five (5) Business Days after the Business Day on which the Agent
receives the Commitment Reduction Notice) by $____________ (insert amount equal
to but not less than $5,000,000 or an integral multiple thereof). The
aggregate amount of Revolving Credit Commitments outstanding after giving effect
to the reduction of the Revolving Credit Commitments is
$__________. The aggregate outstanding principal amount of all
Revolving Facility Usage as of ______________ (insert date of commitment
reduction) shall be $__________ (not to exceed the reduced aggregate amount of
the Revolving Credit Commitments).
[SIGNATURE
PAGE FOLLOWS]
--
[SIGNATURE
PAGE 1 OF 1 TO COMMITMENT REDUCTION NOTICE]
|
|
NEW JERSEY NATURAL GAS
COMPANY, a New Jersey
corporation
|
Date:________________ By:
Name:
Title:
[December __, 2009]
PNC Bank,
National Association, as Administrative Agent
One PNC
Plaza
249 Fifth
Avenue
Pittsburgh,
PA 15222
and each
of the financial institutions listed
on Schedule A hereto (the “Lenders”)
Re: New Jersey Natural Gas
Company
Ladies
and Gentlemen:
We are
special counsel to New Jersey Natural Gas Company, a New Jersey corporation (the
“Borrower”). We have
represented the Borrower in connection with its negotiation, execution and
delivery of that certain Credit Agreement, dated as of the date hereof (the
“Credit Agreement”),
among the Borrower, the Lenders party thereto, the Syndication Agents and
Documentation Agents named therein and party thereto, and PNC Bank, National
Association, in its capacity as Administrative Agent under the Credit Agreement
(in such capacity, the “Agent”), and in connection
with the Transactions (as defined below) contemplated thereby.
This
Opinion Letter is provided to the Agent and the Lenders at the request of the
Borrower in satisfaction of the closing condition set forth in Section 7.1.3(a)
of the Credit Agreement. It is intended solely for the information of
the Agent and the Lenders in connection with the Credit Agreement and the
Transactions, and may not be relied upon by any other person (except as provided
in the next sentence) or for any other purpose. No part of this
Opinion Letter may be incorporated, quoted or otherwise referred to in any other
document or communication or filed with or otherwise furnished to any
governmental authority or other person without our prior written consent, except
that the Agent and each Lender may furnish a copy of this Opinion Letter: (a) in
connection with any proceedings relating to the Loan Documents (as defined
below) or the enforcement thereof; (b) to accountants and counsel for the Agent
or such Lender; (c) to bank or other governmental regulatory examiners; (d)
pursuant to judicial process or government order or requirement; and (e) to
permitted prospective and actual assignees of, and participants in the interests
of, the Agent or such Lender under the Loan Documents (who may rely upon this
Opinion Letter as though it had been addressed and delivered to them as of the
date of this Opinion Letter). In all cases, reliance upon this
Opinion Letter is conditioned upon acceptance of the assumptions, qualifications
and other limitations that are set forth herein (the "Qualifications").
In
connection with this Opinion Letter, we have examined originals or copies of the
Credit Agreement and related instruments and agreements identified as “Loan Documents” on Schedule B hereto, in each
case as executed and delivered in connection with the closing of the
Transactions on the date hereof (the “Closing”).
We also
have examined copies of: (a) the certificate of incorporation of the Borrower,
as certified in the certificate of the Secretary of the Borrower delivered to
the Agent in connection with the Closing (the “Secretary’s Certificate”) as
being currently in effect; (b) the by-laws of the Borrower, as certified in the
Secretary’s Certificate as being currently in effect, (c) the certificate
respecting the good standing of the Borrower (the “Good Standing Certificate”),
and (d) resolutions adopted by the board of directors of the Borrower, relating
to the Loan Documents and the Transactions, and, in each case, as certified in
the Secretary’s Certificate as having been duly adopted and being currently in
effect (Items (a) through (d) above are referred to collectively as the “Organizational
Documents”). We also have examined originals or copies of: (x)
each of the instruments and agreements identified as “Specified Other Agreements” on
Schedule C hereto; (y)
any Material Orders (as defined below); and (z) a certificate as to certain
factual matters from Richard Reich, Esq., Senior Corporate Counsel of NJR
Service Corporation, the parent of the Borrower.
In
addition, we have made such other investigations of applicable New Jersey State
and United States statutes and regulations, as we deemed necessary under
customary practice to enable us to render this Opinion Letter.
In
conducting our examination, we have assumed the genuineness of all signatures,
the legal capacity of all individual signatories, the authenticity, completeness
and accuracy of all documents submitted to us as originals, and the
completeness, accuracy and conformity to authentic originals of all documents
submitted to us as copies (whether or not certified). Each of the
governmental certificates, publicly filed or recorded items and searches of
public record (if any) examined by us were obtained by an independent firm not
under our control or supervision, and we have assumed that they are sufficient
and would disclose no additional relevant or conflicting facts if updated
through the date of this Opinion Letter. In addition, we have assumed
and without independent investigation have relied upon the factual accuracy of
the representations, warranties, certifications and other information contained
in the items we examined and upon the assumptions we have made in this Opinion
Letter. Except as expressly set forth in this Opinion Letter, we have
not conducted or commissioned any search, review, investigation, examination or
inquiry of any books, records, files, financial statements or tax returns of any
person, any internal file, court file, public record or any other information
source, or undertaken any other independent search, review, investigation,
examination or inquiry to determine or confirm the existence or absence of any
facts relevant to the opinions expressed herein. The Loan Documents,
Organizational Documents, Specified Other Agreements and Material Orders are the
only items of their respective types reviewed by us in connection with or
covered by us in this Opinion Letter.
Where
reference is made in this Opinion Letter to matters within our knowledge, or to
facts and circumstances known to us or understood by us, such reference means
the actual knowledge of those attorneys within our firm who have given
substantive attention to the Loan Documents. By actual knowledge, we
mean the conscious awareness of information about fact of any such lawyer
without undertaking any investigation to determine the existence or absence of
any facts, either within our firm or otherwise. Please be advised
that the Borrower also may be represented by other attorneys, and that we have
represented them only in connection with the Transactions and certain other
specific matters.
For the
purposes of this Opinion Letter: (a) “Material Adverse Change” means
any “Material Adverse Change” (as defined in the Credit Agreement), taking into
account our understanding of the business, real and personal property, financial
condition, results of operations and prospects of the Borrower taken as a whole;
(b) “Material Order”
means any written court or administrative order, writ, judgment or decree known
to us to name the Borrower and to be in effect on the date hereof, and the
violation of which or noncompliance with which by the Borrower would, in our
judgment, reasonably be expected to result in a Material Adverse Change; and (c)
“Transactions” means the
establishment of the credit facility under the Credit Agreement in favor of the
Borrower in accordance with the Credit Agreement and other Loan Documents, and
the advance of the Loans contemplated thereunder, all to be effected at the
Closing.
We
express no opinion respecting the Credit Agreement or any other Loan Document,
or any right, power, privilege, remedy or interest intended or purported to be
created thereunder, insofar as: (a) any of the rights, powers, privileges,
remedies and interests of a person thereunder may be limited by: (i) applicable
bankruptcy, insolvency, fraudulent conveyance or transfer, reorganization or
other laws affecting any rights, powers, privileges, remedies and interests of
creditors generally (including, without limitation, post-petition interest),
(ii) rules or principles (of equity, public policy or otherwise) affecting the
enforcement of obligations generally, whether considered at law, in equity or
otherwise, including (without limitation) those pertaining to materiality, good
faith, fair dealing, diligence, reasonableness, unconscionability, impossibility
of performance, suretyship rights or defenses (of a co-borrower, guarantor or
otherwise), waiver, laches, estoppel or judicial deference, or (iii) the
exercise of the discretionary powers of any court or other authority before
which may be brought any proceeding seeking equitable or other remedies,
including (without limitation) specific performance, injunctive relief and
indemnification; (b) the rights, powers, privileges, remedies and interests of
any person under any Loan Document or applicable law may be exercised or
otherwise enforced in bad faith, in a commercially unreasonable manner or for
immaterial breaches; and (c) any term or
provision of any Loan Document conflicts or is inconsistent with any other term
or provision of that or any other Loan Document.
We
express no opinion whatsoever respecting any Loan Document, or any right, power,
privilege, remedy or interest intended or purported to be created thereunder,
insofar as any term or provision of any Loan Document purportedly grants, or
otherwise authorizes or permits, a person to exercise or otherwise enforce or
pursue specific rights, powers, privileges and remedies in a manner
impermissible under or otherwise inconsistent with applicable law or public
policy from time to time in effect; provided, however, that without the
provisions referenced above in this paragraph (and assuming that a
court would sever any such terms and provisions from such respective Loan
Documents) the Agent and the Lenders nevertheless have legally adequate rights
and remedies under the Loan Documents and applicable law for pursuit of a claim
for principal and interest owed by the Borrower under the Loan Documents, in
each case subject to clauses (a), (b) and (c) in the preceding paragraph, above,
and the other Qualifications of this Opinion Letter.
We
express no opinion whatsoever as to any of the following in any Loan Document:
(i) any agreement to agree, any penalty, any power of attorney, any severability
or future reformation, or any "savings", "time is of the essence" or similar
provision; (ii) any exculpation or indemnification for bad faith, negligence,
misconduct or breach of contract or applicable law or for any matter to the
extent impermissible under applicable law or public policy; (iii) any waivers or
limits respecting jury trial, required notices, required procedures, legal
rights and remedies, or service of process; (iv) any table of contents or
section or other headings where the substantive effect thereof has not been
effectively waived in the applicable Loan Document; (v) matters of
conspicuousness of any provision; or (vi) any provision of any Loan Document
purporting to deem any notice as effective after a period of time irrespective
of its actual receipt or to include the period between the giving or deemed
receipt of notice and the time of its actual receipt in any calculation
respecting any prior notice, cure or similar period required under any Loan
Document.
We
express no opinion with respect to: title to or use of any property; the
applicable laws of any county, town, municipality or other local or special
political subdivision; or the creation, legality, validity, binding effect,
enforceability, perfection or priority of any security interest or other lien or
encumbrance, or as to the absence of any security interests or other liens or
encumbrances. We also express no opinion regarding any consent to
jurisdiction or venue. Furthermore, we express no opinion as to
matters pertaining to any Anti-Terrorism Laws (as defined in the Credit
Agreement), as to the Federal Power Act or any other federal or state statutory,
regulatory or other legal requirement related to natural gas or other energy
production, transport, storage or commerce, or related to the ownership or
operation of any person directly or indirectly engaged in any of the foregoing;
or as to any applicable law respecting: zoning, land use, wetlands or the like;
hazardous substances or the environment; health or safety; food, alcohol, drugs
or other regulated items; criminal activities; criminal or civil forfeiture;
national or state emergency; employment or labor; pension or benefit plans;
antitrust or unfair competition; racketeering; fiduciary duties; taxes or
levies; or securities, futures, commodities and the like (including, without
limitation, any blue sky or similar law), including as to margin
stock. We express no opinion as to any filings or notices (whether as
assumed by us or otherwise), or as to the effect of textual
bolding. We have also assumed that the Loans and Reimbursement
Obligations, and related obligations, are principal obligations of the
Borrower. In addition, we express no opinion insofar as any Loan
Document may purport to govern or otherwise apply to any affiliate of the
Borrower. We advise you that the Borrower does not have authority to
effect any revolving credit commitment increase permitted under Section 2.11 of
the Credit Agreement absent further appropriate corporate authorization
therefor. In any event, we express no opinion as to any matter
assumed by us, any factual information provided to us or any other matter, in
each case except as expressly set forth in this Opinion Letter.
Our
express assumptions and qualifications are not in limitation of others that
customarily apply (expressly or impliedly) to legal opinion letters, including
that: (a) each party to a Loan Document (other than Borrower) or other document
we examined: (i) is duly organized, validly existing and in good standing in its
jurisdiction of organization and is qualified to do business and licensed in
each other jurisdiction necessary to its performance or enforcement thereunder,
(ii) has full power, authority and capacity and has been duly authorized and
empowered to execute, deliver and perform its obligations under each such
document, (iii) has satisfied all legal, governance and contractual requirements
applicable to it to the extent necessary to make each such document enforceable
by or against it, and (iv) is properly identified with its true, complete and
correct legal name and organizational jurisdiction therein; (b) each Loan
Document has been duly executed and delivered by each party thereto (other than
the Borrower) and, other than as to the Borrower, is the legal, valid and
binding obligation of each such party, enforceable as written against each such
party in accordance with its terms and provisions; (c) each of the Specified
Other Agreements, Material Orders and other documents we examined would be
enforced as written; (d) each certificate, report or other document issued by
any governmental official, office or agency concerning any person, real or
personal property, or status is, and all public records (including their proper
indexing and filing) are, accurate, complete, authentic and current; (e) there
has not been any mutual mistake of fact, misunderstanding, duress, undue
influence or fraud or other criminal activity, and any requirement of good
faith, fair dealing and conscionability has been met; (f) the Loan Documents
contain all of the provisions intended by the parties and the entire agreement
of the parties thereto with respect to the subject matter thereof, and there are
no written or oral agreements or understandings among the parties, and there is
no usage of trade or course of dealing among the parties, that in any case could
define, conflict with, supplement or qualify any term or provision of any Loan
Document; (g) no person will in the future take any action (including a decision
not to act) that: (1) is prohibited under any Loan Document, Organizational
Document, Specified Other Agreement, Material Order or applicable law, or (2)
may be permitted, but not required, under any Loan Document if such action would
result in any violation of applicable law or constitute any violation or default
under any other Loan Document, Organizational Document, Specified Other
Agreement or Material Order; (h) the proceeds of the Loans at the Closing have
been disbursed in accordance with the Loan Documents; (i) all conditions
precedent to the effectiveness of the Loan Documents have been duly satisfied or
waived; and (j) any and all fees, taxes (including, without limitation,
documentary, intangible, stamp and recording taxes) and charges imposed in
connection with the Loan Documents have been paid in full to the authorities or
other parties entitled to payment thereof.
Our
opinions are limited to the date hereof. We do not undertake to
advise you of any facts or circumstances occurring or coming to our attention
subsequent to the Closing. Whenever any opinion in this Opinion
Letter refers to or includes the performance of any obligation or the issuance
of any instrument or certificate after the Closing, it is based on our
assumption that: (i) all relevant facts and circumstances will be the same at
such future time as we believe them to be at the Closing (except as noted in the
next clause); (ii) each party will have taken all future or further actions
necessary or appropriate thereto; (iii) no relevant filings, approvals, permits
or similar items will have expired or otherwise adversely changed; and (iv) no
changes will have occurred in any of the Loan Documents, Organizational
Documents, Specified Other Agreements, Material Orders, other relevant
documents, applicable law, trade usage or course of dealings.
Finally,
for purposes of this Opinion Letter we express no opinion as to the applicable
laws of any jurisdiction other than the laws of the State of New Jersey and the
federal laws of the United States. Please note that we have based our
opinions in numbered paragraph 1 below solely on our review of the Good Standing
Certificate. Also please be aware that, consistent with the opinion
practices of the New Jersey bar, our opinions contained in this Opinion Letter
are expressions of our professional judgment regarding the legal matters
addressed and are not guarantees or warranties that a court or other authority
will reach any particular result.
Based
upon and subject to the foregoing, we are of the opinion that:
1. The
Borrower is validly existing and in good standing under the laws of the State of
New Jersey.
2. The
Borrower: (a) has the corporate power and authority to execute and deliver the
Loan Documents, and to consummate the Transactions and (b) has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Loan Documents to which it is a party, and has duly executed and
delivered each Loan Document to which it is a party.
3. Each
Loan Document constitutes the legal, valid and binding obligation of the
Borrower and is enforceable against the Borrower in accordance with its
terms.
4. The
execution and delivery by the Borrower of the Loan Documents, the performance
(in accordance with the terms thereof) by the Borrower of its obligations
thereunder, and the consummation of the Transactions: (a) do not violate any
provision of the Organizational Documents; (b) do not contravene any applicable
provision of any New Jersey State or United States statute, rule or regulation
that we have, in the exercise of customary professional diligence, recognized as
applicable to the Borrower in connection with the Transactions; (c) do not
violate any Material Order; and (d) do not conflict with or result in any breach
of or constitute a default under, or result in the creation of any security
interest or other lien upon any of the real or personal property of the Borrower
pursuant to the terms of, any Specified Other Agreement.
6. To
our knowledge, except as set forth in the SEC Filings or otherwise disclosed in
the Loan Documents, there are no actions, suits or proceedings pending or
threatened against the Borrower or any of its real or personal property that in
our judgment reasonably would be expected to result in a Material Adverse
Change.
7. The
Borrower is not an “investment company” or is a company “controlled” by an
“investment company”, in each case within the meaning of the Investment Company
Act of 1940, as amended.
Very
truly yours,
TROUTMAN
SANDERS LLP
SCHEDULE
A TO OPINION LETTER
Lenders
SCHEDULE
B TO OPINION LETTER
List of Loan
Documents
The
following instruments and agreements collectively constitute the “Loan Documents” for purposes
of this Opinion Letter:
|
|
1.
|
Credit
Agreement;
|
|
|
2.
|
Swing
Loan Note, dated as of the date hereof, issued by the Borrower to the
order of PNC Bank, National Association in the principal amount of
$[________];
|
|
|
3.
|
Revolving
Credit Notes, each dated as of the date hereof, issued by the Borrower to
the order of each of the following Lenders in the respective principal
amounts set forth opposite each such Bank’s
name:
|
|
|
a.
|
PNC
Bank, National Association-$
|
|
|
b.
|
|
|
c.
|
|
|
d..
|
SCHEDULE
C TO OPINION LETTER
List of Specified Other
Agreements
The
following instruments and agreements collectively constitute the “Specified Other Agreements”
for purposes of this Opinion Letter:
|
|
1.
|
Note
Purchase Agreement, dated as of May 15, 2008, among the Borrower and the
purchasers party thereto, relating to the Borrower’s issuance and sale of
an aggregate principal amount of $125,000,000 of its 5.60% senior notes
due May 15, 2008
|
|
|
2.
|
Indenture
of Mortgage and Deed of Trust, dated April 1, 1952, as supplemented and
amended by the thirty-one supplemental indentures identified therein,
between New Jersey Natural Gas Company to BNY Midwest Trust Company, (As
Successor Trustee to Harris Trust And Savings Bank), as Trustee (the
“Mortgage and Deed of
Trust”)
|
|
|
3.
|
Thirty-Second
Supplemental Indenture dated as of May 1, 2008 between New Jersey Natural
Gas Company and BNY Midwest Trust Company, as Trustee to Mortgage and Deed
of Trust
|
[Richard
Reich Letterhead]
December __, 2009
PNC Bank,
National Association, as Administrative Agent
One PNC
Plaza
249 Fifth
Avenue
Pittsburgh,
PA 15222
and each
of the financial institutions listed
on Schedule A hereto
(the “Lenders”)
Re: Revolving Credit Facility
i/f/o New Jersey Natural Gas Company
Ladies
and Gentlemen:
I am
counsel to New Jersey Natural Gas Company, a New Jersey corporation (the “Borrower”). I
have represented the Borrower in connection with its negotiation, execution and
delivery of that certain Credit Agreement, dated as of the date hereof (the
“Credit
Agreement”), among the Borrower, the Lenders, the Syndication Agents and
Documentation Agents named therein and party thereto, and PNC Bank, National
Association, in its capacity as Administrative Agent under the Credit Agreement
(in such capacity, the “Agent”), and in
connection with the transactions contemplated thereby.
This
opinion letter is provided to the Agent and the Lenders at the request of the
Borrower in satisfaction of the closing condition set forth in Section 7.1.3(b)
of the Credit Agreement. It is intended solely for the information of
the Agent and the Lenders in connection with the Credit Agreement and
transactions contemplated thereby, and may not be relied upon by any other
person (except as provided in the next sentence) or for any other
purpose. No part of this opinion letter may be incorporated, quoted
or otherwise referred to in any other document or communication or filed with or
otherwise furnished to any governmental authority or other person without my
prior written consent, except that my prior written consent is not needed to
furnish a copy of this opinion letter: (a) in connection with any proceedings
relating to the Loan Documents (as defined below) or the enforcement thereof;
(b) to accountants and counsel for the Agent or any Lender; (c) to bank or other
governmental regulatory examiners; (d) pursuant to judicial process or
government order or requirement; and (e) to permitted prospective and actual
assignees of, and participants in the interests of, the Agent or such Lender
under the Loan Documents (who may rely upon this Opinion Letter as though it had
been addressed and delivered to them as of the date of this Opinion
Letter). In all cases, reliance upon this opinion letter is
conditioned upon acceptance of the assumptions, qualifications and other
limitations that are set forth herein.
For
purposes of the opinions expressed herein, I have examined originals or copies
of the Credit Agreement and related instruments and agreements identified as
“Loan
Documents” on Schedule B hereto, in
each case as executed and delivered at the closing of the transactions
contemplated by the Credit Agreement on the date hereof (the “Closing”).
I also
have examined copies of: (a) a certificate respecting the good standing of the
Borrower I recently received from the State of New Jersey; (b) the certificate
of incorporation of the Borrower, as certified in the certificate of the
Secretary of the Borrower delivered to the Agent in connection with the Closing
(the, “Secretary’s
Certificate”) as being currently in effect; (c) the by-laws of the
Borrower, as certified in the Secretary’s Certificate as being currently in
effect; and (d) resolutions adopted by the board of directors of the Borrower,
relating to the Loan Documents and the transactions contemplated thereby, and
relating to the Loan Documents and the transactions contemplated thereby, as
certified in the Secretary’s Certificate as having been duly adopted and being
currently in effect. (Items (a) through (d) above are referred to
collectively as the “Organizational
Documents”). In addition, I have made such other
investigations of applicable New York State and United States statutes and
regulations as I deemed necessary under customary practice to enable me to
render this opinion letter. As noted below, I also have reviewed the
New Jersey Business Corporation Act (“NJBCA”), as posted on a
website maintained by that jurisdiction at . I am not licensed to
practice law in the State of New Jersey. I am, however, licensed to
practice law as an in-house counsel in the State of New Jersey and as such, am
familiar with those laws, rules and regulations of the State of New Jersey as I
deemed relevant to enable me to render this opinion letter.
I express
no opinion with respect to: title to or use of any property; the applicable laws
of any county, town, municipality or other local or special political
subdivision; or the creation, legality, validity, binding effect,
enforceability, perfection or priority of any security interest or other lien or
encumbrance, or as to the absence of any security interests or other liens or
encumbrances. Furthermore, I express no opinion as to matters
pertaining to any Anti-Terrorism Laws (as defined in the Credit Agreement), as
to the Federal Power Act or any other federal or state statutory, regulatory or
other legal requirement related to natural gas or other energy production,
transport, storage or commerce, or related to the ownership or operation of any
person directly or indirectly engaged in any of the foregoing; or as to any
applicable law respecting: zoning, land use, wetlands or the like; hazardous
substances or the environment; health or safety; food, alcohol, drugs or other
regulated items; criminal activities; criminal or civil forfeiture; national or
state emergency; employment or labor; pension or benefit plans; antitrust or
unfair competition; racketeering; fiduciary duties; taxes or levies; or
securities, futures, commodities and the like (including, without limitation,
any blue sky or similar law), including as to margin stock (except as noted in
paragraph no. 6 below). In any event, I express no opinion as to any
matter assumed by me, any factual information provided to me or any other
matter, in each case except as expressly set forth in this opinion
letter.
My
express assumptions and qualifications are not in limitation of others that
customarily apply (expressly or impliedly) to legal opinion letters, including
that each of the Loan Documents and other items I examined would be enforced as
written.
In
conducting my examinations, I have assumed the genuineness of all signatures
(other than that of the Borrower at the Closing), the legal capacity of all
individual signatories, the accuracy of all documents submitted to me as
originals and the conformity to originals of all documents submitted to me as
copies (whether or not certified). In addition, I have assumed and
without independent investigation have relied upon the factual accuracy of the
representations, warranties and other information contained in the items I
examined (except where, based upon facts and circumstances actually known to me,
such reliance would be unwarranted) and upon the assumptions I have made in this
opinion letter. Except as expressly set forth in this opinion letter,
I have not conducted or commissioned any search of the books, records, files,
financial statements or tax returns of any person, searched any internal file,
court file, public record or other information source, reviewed any agreement or
other instrument or undertaken any other independent investigation, examination
or inquiry to determine or confirm the existence or absence of any facts
relevant to the opinions expressed herein.
Where
reference is made in this opinion letter to matters within my knowledge, or to
facts and circumstances known to me or understood by me, such reference means my
actual knowledge. By actual knowledge, I mean my conscious awareness
of information about either fact or law (depending upon usage) without
undertaking any investigation to determine the existence or absence of any
facts.
For the
purposes of this opinion letter, “Material Adverse Change” means
any “Material Adverse Change” (as defined in the Credit Agreement), taking into
account my understanding of the business, real and personal property, financial
condition, results of operations and prospects of the Borrower.
My
opinions are limited to the date hereof. I do not undertake to advise
you of any facts or circumstances occurring or coming to my attention subsequent
to the date hereof.
Finally,
for purposes of this opinion letter I express no opinion as to the applicable
laws of any jurisdiction other than the laws of the State of New York, the
federal laws of the United States, and, as described in the next sentence, the
laws of the State of New Jersey. I am not admitted to practice in the
State of New Jersey and do not hold myself out as expert in New Jersey law; and,
accordingly, I base my opinions in paragraphs 1-2 below on my review of the
NJBCA, and I base my opinions in paragraphs 4 and 5 below solely on my actual
knowledge of applicable New Jersey law.
Based on
the foregoing, and subject to the qualifications stated herein, I am of the
opinion that:
1. The
Borrower is a corporation incorporated, validly existing and in good standing
under the laws of the State of New Jersey.
2. The
Borrower has the corporate power and authority to execute and deliver the Loan
Documents, and to consummate the transactions contemplated
thereby. The Borrower has taken all necessary corporate action to
authorize the execution, delivery and performance of the Loan Documents, and has
duly executed and delivered each Loan Document.
3. The
execution and delivery by the Borrower of the Loan Documents, the performance
(in accordance with the terms thereof) by the Borrower of its obligations
thereunder, and the consummation of the transactions contemplated thereby: (a)
do not conflict with or result in any breach of or constitute a default under
any agreement, judgment, injunction, order, decree or other instrument binding
upon or affecting the Borrower, except insofar as any such conflict, breach or
default would not reasonably be expected to result in a Material Adverse Change;
and (b) do not result in the creation of any security interest or other lien
upon any of the real or personal property of the Borrower pursuant to the terms
of any agreement or other instrument binding upon the Borrower. For
purposes of the preceding sentence, however, I exclude any Organizational
Document, as well as any instrument or agreement that is one of the “Specified
Other Agreements” referred to in the legal opinion letter of even date herewith
addressed to you of Troutman Sanders LLP.
4. No
material registration with, material consent of, material approval of, or other
material action by, any federal or New Jersey state governmental authority or
regulatory body is required by law to be obtained by the Borrower in connection
with the execution and delivery of the Loan Documents, or in connection with the
extension of credit by the Lenders to the Borrower under the Loan Documents,
other than the approval of the New Jersey Board of Public Utilities (the “BPU”) which was
issued by its order dated December 1, 2009 (a copy of which is annexed hereto),
which order is final and non-appealable and remains in full force and effect as
of the date hereof.
5. To
my knowledge, the Borrower: (a) is not in default with respect to any order,
writ, injunction or decree of any court or any federal, state, municipal or
other governmental authority (including, without limitation, the BPU); and (b)
is in compliance with all federal and New Jersey state laws, rules and
regulations applicable to them; in each case except where such default or
noncompliance would not reasonably be expected to result in a Material Adverse
Change.
6. To
my knowledge, the Borrower is not engaged in the business of purchasing or
selling margin stock (within the meaning of Regulation U promulgated by the
Board of Governors of the Federal Reserve System) or extending credit to others
for the purposes of purchasing or carrying any such margin stock. To
my knowledge, no part of the proceeds of the Loans (as defined in the Credit
Agreement) will be used by the Borrower to purchase or carry any such margin
stock or for any other purpose which would violate or be inconsistent with said
Regulation U.
7. In
as much as the Securities and Exchange Commission has not declared the Borrower
to be a “holding company” or an “affiliate” of a “holding company” or a
“subsidiary company” of a “holding company” within the meaning of the Public
Utility Holding Company Act of 1935, as amended, I am of the opinion that the
Borrower is not a “holding company” or an “affiliate” of a “holding company” or
a “subsidiary company” of a “holding company” within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
Very
truly yours,
Richard
Reich, Senior Corporate Counsel
of NJR
Service Corporation
SCHEDULE
A TO OPINION LETTER
List of
Lenders
The
following financial institutions collectively constitute the “Lenders” for purposes of this
opinion letter:
|
|
1.
|
PNC
Bank, National Association
|
|
|
2.
|
JPMorgan
Bank, N.A.
|
|
|
3.
|
Toronto
Dominion (New York) LLC
|
|
|
4.
|
U.S.
Bank, National Association
|
|
|
5.
|
Wachovia
Bank, National Association
|
|
|
6.
|
Sovereign
Bank
|
|
|
7.
|
The
Northern Trust Company
|
|
|
8.
|
The
Bank of New York Mellon
|
SCHEDULE
B TO OPINION LETTER
List of Loan
Documents
The
following instruments and agreements collectively constitute the “Loan Documents” for purposes
of this Opinion Letter:
|
|
1.
|
Credit
Agreement
|
|
|
2.
|
Swing
Loan Note, dated as of the date hereof, issued by the Borrower to the
order of PNC Bank, National Association in the principal amount of
$20,000,000
|
|
|
3.
|
Revolving
Credit Notes, each dated as of the date hereof, issued by the Borrower to
the order of each of the following Lenders in the respective principal
amounts set forth opposite each such Lender’s
name:
|
|
a.
|
PNC
Bank, National
Association $40,000,000
|
|
b.
|
JPMorgan
Bank,
N.A. $30,000,000
|
|
c.
|
Toronto
Dominion (New York)
LLC $30,000,000
|
|
d.
|
U.S.
Bank, National
Association $30,000,000
|
|
e.
|
Wachovia
Bank, National
Association $25,000,000
|
|
f.
|
Sovereign
Bank $20,000,000
|
|
g.
|
The
Northern Trust
Company $15,000,000
|
|
h.
|
The
Bank of New York
Mellon $10,000,000
|
EXHIBIT
8.2.5
FORM
OF
ACQUISITION
COMPLIANCE CERTIFICATE
____________________,
20___
PNC Bank,
National Association, as Agent
One PNC
Plaza
249 Fifth
Avenue
Pittsburgh,
Pennsylvania 15222-2707
and each
Lender party to the Credit Agreement (defined below)
Ladies
and Gentlemen:
I refer
to the Credit Agreement dated as of December ____, 2009 (as amended,
supplemented, restated or modified from time to time, the "Credit Agreement")
among New Jersey Natural Gas Company (the "Borrower"), the Lenders party
thereto, each syndication agent, each documentation agent and each other titled
Lender that may be identified therein, and PNC Bank, National Association in its
capacity as administrative agent for the Lenders (the
"Agent"). Unless otherwise defined herein, terms defined in the
Credit Agreement are used herein with the same meanings. References
herein to Sections of the Credit Agreement are qualified, in their entirety, by
the applicable provision of the Section of the Credit Agreement so referred to
and together with all related provisions and definitions referred to in such
Section or incorporated therein.
I,
______________________, [Chief Executive
Officer/President/Chief Financial Officer] of the Borrower, do hereby
certify on behalf of the Borrower as of the [fiscal quarter/fiscal year
ended _________________, 20__] as follows:
In
connection with Section 8.2.5 of the Credit Agreement and with respect to a
proposed Permitted Acquisition by the Borrower (the "Acquiring Company") of
__________ [assets/stock] [by purchase/by merger and insert description of the
transaction] (the "Acquisition") of ____________________________ [insert name of
entity whose assets are/stock is being acquired] (the "Target").
The
proposed date of the Acquisition is _________________ (the "Acquisition Date")
[at least 5 Business Days after the date of this certificate].
The
"Report Date" herein shall be the date of the most recent fiscal quarter ended
prior to the proposed Acquisition of the Target.
The total
Consideration to be paid including (i) cash paid by the Borrower, directly
or indirectly, to the Target, (ii) the Indebtedness, fixed or contingent,
incurred or assumed the Borrower, whether in favor of Target or otherwise,
(iii) any Guaranty given or incurred by the Borrower in connection with the
Acquisition and (iv) any other consideration given or obligation incurred
by the Borrower in connection with the Acquisition is $__________.
The
Target is engaged in ____________________ [describe business being
acquired].
The
Borrower is, and after giving effect to the proposed Permitted Acquisition shall
be, in compliance with Sections 8.2.12 and 8.2.13 of the Credit Agreement, as
more fully set forth on Appendix A attached
hereto.
The
Borrower, in order to consummate the proposed Permitted Acquisition, has
incurred or will incur $__________ of Indebtedness permitted by Section
8.2.1(__).
Immediately
prior to and after giving effect to the proposed Acquisition: (i) the
representations and warranties of Borrower contained in Section 6 of the Credit
Agreement and in the other Loan Documents are true on and correct with the same
effect as though such representations and warranties had been made on and as of
such date (except representations and warranties which expressly related solely
to an earlier date or time), (ii) the Borrower has performed and complied with
all covenants and conditions of the Credit Agreement and the other Loan
Documents, and (iii) no event has occurred and is continuing which constitutes
an Event of Default or Potential Event of Default.
IN
WITNESS WHEREOF, the undersigned has executed this Certificate this _____ day of
____________, 20___.
By:
Name:
|
|
Title:
|
[Chief Executive
Officer/President/Chief Financial Officer]
|
APPENDIX
A
|
Credit Agreement
|
Consolidated
for Borrower and
its Subsidiaries
|
Target
|
Consolidated
Pro Forma6
|
|
(1)Maximum
Leverage Ratio (Section 8.2.12). The ratio of
(A) Consolidated Total Indebtedness to (B) Consolidated Total
Capitalization as of the Report Date is:
which
is not more than the maximum permitted ratio of 0.65 to
1.0
|
_____
to 1.00
|
_____
to 1.00
|
_____
to 1.00
|
|
(A)Consolidated
Total Indebtedness, as of the Report Date, is computed as
follows:
(i)borrowed
moneys
(ii)other
transactions similar to borrowed money transactions
(iii)note
purchase or acceptance credit facilities
(iv)reimbursement
obligations (contingent or otherwise)
(v)Hedging
Transactions
(vi)Guarantees
of Hedging Transactions and of borrowed money transactions
(vii)Hybrid
Securities described in clause (i) of the definition of "Hybrid Security"
in the Credit Agreement
(viii)mandatory
repayment obligations with respect to Hybrid Securities described in
clause (ii) of the definition of "Hybrid Security" in the Credit
Agreement
(ix)sum
of items (i) through (viii) equals Consolidated Total
Indebtedness
|
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
|
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
|
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
|
|
(B)Consolidated
Total Capitalization, as of the Report Date, is computed as
follows:
(i)Consolidated
Total Indebtedness (see item (1)(A)(ix) above)
(ii)Common
Shareholders' Equity
(iii)Preferred
Shareholders' Equity
(iv)sum
of items (i) through (iii) equals Consolidated Total
Capitalization
|
$__________
$__________
$__________
$__________
|
$__________
$__________
$__________
$__________
|
$__________
$__________
$__________
$__________
|
|
(2)Minimum
Interest Coverage Ratio (Section 8.2.13). The ratio of
(A) Consolidated Income from Operations to (B) Consolidated
Interest Expense calculated as of the end of each fiscal quarter for the
four (4) fiscal quarters then ended as of the Report Date is:
which is not less than the
minimum permitted ratio of 2.50 to 1.00 as of the Report
Date.
|
_____
to 1.00
|
_____
to 1.00
|
_____
to 1.00
|
|
(A)Consolidated
Income from Operations for the applicable period is computed as
follows:
(i)net
income (excluding extraordinary items of gain or loss and excluding any
gain or loss of any Person accounted for on the equity method except to
the extent of cash distributions received during the applicable period
with respect to any gain of any Person accounted for on the equity
method)
|
$__________
|
$__________
|
$__________
|
|
1. See
note 1 on prior page.
|
|
||
|
(ii)depreciation
(iii)amortization
(iv)other
similar noncash charges to net income [explain in detail nature of non
cash charge]
(v)interest
expense
(vi)income
tax expense
(vii)sum
of items (i) through (vi)
(viii)noncash
credits to net income
(ix)item
(vii) reduced by item (viii) equals Consolidated Income from
Operations
|
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
|
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
|
$__________
$__________
$__________
$__________
$__________
$__________
$__________
$__________
|
|
(B)Consolidated
Interest Expense for the applicable period is:
|
$__________
|
$__________
|
$__________
|
1. See
note 1 on prior page.
EXHIBIT
8.3.3
FORM
OF
COMPLIANCE
CERTIFICATE
____________________,
20___
PNC Bank,
National Association, as Agent
One PNC
Plaza
249 Fifth
Avenue
Pittsburgh,
Pennsylvania 15222-2707
and each
Lender party to the Credit Agreement (defined below)
Ladies
and Gentlemen:
I refer
to the Credit Agreement dated as of December ____, 2009 (as amended,
supplemented, restated or modified from time to time, the "Credit Agreement")
among New Jersey Natural Gas Company (the "Borrower"), the Lenders party
thereto, each syndication agent, each documentation agent and each other titled
Lender that may be identified therein, and PNC Bank, National Association in its
capacity as administrative agent for the Lenders (the
"Agent"). Unless otherwise defined herein, terms defined in the
Credit Agreement are used herein with the same meanings. References
herein to Sections of the Credit Agreement are qualified, in their entirety, by
the applicable provision of the Section of the Credit Agreement so referred to
and together with all related provisions and definitions referred to in such
Section or incorporated therein.
I,
______________________, [Chief Executive
Officer/President/Chief Financial Officer] of the Borrower, do hereby
certify on behalf of the Borrower as of the [fiscal quarter/fiscal year
ended _________________, 20__] (the "Report Date"), as
follows:
[Missing Graphic Reference]
6 All calculations are on a pro-forma
basis, based upon the financial statements of the Borrower as of the Report
Date, after giving effect to the proposed Permitted Acquisition (i.e., if a financial covenant is measured
for the immediately preceding four fiscal quarters as of the Report Date, the
financial results of the Target as well as the Borrower and its Subsidiaries
will be included in that four fiscal quarter period
calculation; provided, however, that income earned or expenses
incurred by the Target prior to the date of the proposed Permitted Acquisition
shall be excluded) and include in such calculations Indebtedness or other
liabilities assumed or incurred in connection with such Permitted
Acquisition.