Exhibit 10

$1,500,000,000

THREE-YEAR CREDIT AGREEMENT

among

CONSOLIDATED NATURAL GAS COMPANY

,

The Several Lenders from Time to Time Parties Hereto,

BARCLAYS BANK PLC,

as Administrative Agent,

BARCLAYS BANK PLC AND
KEYBANK NATIONAL ASSOCIATION,

as Syndication Agents

and

ABN AMRO BANK N.V.,
THE BANK OF NOVA SCOTIA AND
SUNTRUST BANK,

as Co-Documentation Agents,

______________________________

BARCLAYS CAPITAL AND
KEYBANK NATIONAL ASSOCIATION,

as Joint Lead Arrangers and Joint Bookrunners

Dated as of August 10, 2004

 

 

Table of Contents

 

 

Page

SECTION 1.

DEFINITIONS AND ACCOUNTING TERMS

1

1.1.

Definitions.

1

1.2.

Computation of Time Periods; Other Definitional Provisions.

15

1.3.

Accounting Terms.

15

1.4.

Time.

16

SECTION 2.

LOANS

16

2.1.

Loan Commitment.

16

2.2.

Method of Borrowing for Loans.

16

2.3.

Funding of Loans.

17

2.4.

Minimum Amounts of Loans.

18

2.5.

Reductions of Loan Commitment.

18

2.6.

Loan Notes.

18

SECTION 3.

PAYMENTS

18

3.1.

Interest.

18

3.2.

Prepayments.

19

3.3.

Payment in Full at Maturity.

19

3.4.

Fees.

19

3.5.

Place and Manner of Payments.

20

3.6.

Pro Rata Treatment.

20

3.7.

Computations of Interest and Fees.

20

3.8.

Sharing of Payments.

21

3.9.

Evidence of Debt.

22

SECTION 4.

ADDITIONAL PROVISIONS REGARDING LOANS

22

4.1.

Eurodollar Loan Provisions.

22

4.2.

Capital Adequacy.

24

4.3.

Compensation.

24

4.4.

Taxes.

25

4.5.

Mitigation; Mandatory Assignment.

26

SECTION 5.

LETTERS OF CREDIT

27

5.1.

L/C Commitment.

27

5.2.

Procedure for Issuance of Letter of Credit.

28

5.3.

Fees and Other Charges.

28

5.4.

L/C Participations.

28

5.5.

Reimbursement Obligation of the Borrower.

29

5.6.

Obligations Absolute.

30

5.7.

Letter of Credit Payments.

30

5.8.

Applications.

30

SECTION 6.

CONDITIONS PRECEDENT

31

6.1.

Closing Conditions.

31

6.2.

Conditions to Loans.

32

SECTION 7.

REPRESENTATIONS AND WARRANTIES

33

7.1.

Organization and Good Standing.

33

7.2.

Due Authorization.

33

7.3.

No Conflicts.

34

7.4.

Consents.

34

7.5.

Enforceable Obligations.

34

7.6.

Financial Condition.

34

7.7.

No Default.

34

7.8.

Indebtedness.

35

7.9.

Litigation.

35

7.10.

Taxes.

35

7.11.

Compliance with Law.

35

7.12.

ERISA.

35

7.13.

Use of Proceeds.

36

7.14.

Government Regulation.

36

7.15.

Solvency.

36

SECTION 8.

AFFIRMATIVE COVENANTS

36

8.1.

Information Covenants.

36

8.2.

Preservation of Existence and Franchises.

38

8.3.

Books and Records.

38

8.4.

Compliance with Law.

38

8.5.

Payment of Taxes.

38

8.6.

Insurance.

38

8.7.

Performance of Obligations.

39

8.8.

ERISA.

39

8.9.

Audits/Inspections.

39

8.10.

Total Funded Debt to Capitalization.

39

SECTION 9.

NEGATIVE COVENANTS

40

9.1.

Nature of Business.

40

9.2.

Consolidation and Merger.

40

9.3.

Sale or Lease of Assets.

40

9.4.

Limitation on Liens.

40

9.5.

Fiscal Year.

41

SECTION 10.

EVENTS OF DEFAULT

41

10.1.

Events of Default.

41

10.2.

Acceleration; Remedies.

43

10.3.

Allocation of Payments After Event of Default.

44

SECTION 11.

AGENCY PROVISIONS

45

11.1.

Appointment.

45

11.2.

Delegation of Duties.

45

11.3.

Exculpatory Provisions.

45

11.4.

Reliance on Communications.

46

11.5.

Notice of Default.

46

11.6.

Non-Reliance on Administrative Agent and Other Lenders.

47

11.7.

Indemnification.

47

11.8.

Administrative Agent in Its Individual Capacity.

48

11.9.

Successor Administrative Agent.

48

SECTION 12.

MISCELLANEOUS

48

12.1.

Notices.

48

12.2.

Right of Set-Off; Adjustments.

49

12.3.

Benefit of Agreement.

50

12.4.

No Waiver; Remedies Cumulative.

52

12.5.

Payment of Expenses, etc.

53

12.6.

Amendments, Waivers and Consents.

53

12.7.

Counterparts; Telecopy.

54

12.8.

Headings.

54

12.9.

Defaulting Lender.

55

12.10.

Survival of Indemnification and Representations and Warranties.

55

12.11.

GOVERNING LAW.

55

12.12.

WAIVER OF JURY TRIAL

.

55

12.13.

Severability.

55

12.14.

Entirety.

55

12.15.

Binding Effect.

56

12.16.

Submission to Jurisdiction.

56

12.17.

Confidentiality.

56

12.18.

Designation of SPVs.

57

12.19.

USA Patriot Act.

58

 

--------------------------------------------------------------------------------

SCHEDULES

Schedule 1.1 Commitment Percentages

Schedule 1.1A Eligible Dealers

Schedule 5.1 Existing Letters of Credit

Schedule 7.8 Indebtedness

Schedule 12.1 Notices

EXHIBITS

Exhibit 2.2(a) Form of Notice of Borrowing

Exhibit 2.2(c) Form of Notice of Conversion/Continuation

Exhibit 2.6(a) Form of Loan Note

Exhibit 6.1(c) Form of Closing Certificate

Exhibit 6.1(f) Form of Legal Opinion

Exhibit 8.1(c) Form of Officer's Certificate

Exhibit 12.3 Form of Assignment Agreement

 

THREE-YEAR

CREDIT AGREEMENT

THREE-YEAR CREDIT AGREEMENT (this "Credit Agreement"), dated as of August 10,
2004 among:

CONSOLIDATED NATURAL GAS COMPANY, a Delaware corporation (the "Borrower");

the several banks and other financial institutions from time to time parties to
this Credit Agreement (each, a "Lender" and, collectively, the "Lenders");

BARCLAYS BANK PLC ("Barclays") (main office: New York, New York), KEYBANK
NATIONAL ASSOCIATION ("KeyBank"), and SUNTRUST BANK ( "SunTrust"), as the
Issuing Lenders hereunder (and as defined herein);

BARCLAYS, the investment banking division of Barclays, and KEYBANK, as
Syndication Agents;

ABN AMRO BANK N.V., THE BANK OF NOVA SCOTIA and SUNTRUST, as Co-Documentation
Agents;

and

BARCLAYS, as administrative agent for the Lenders hereunder (in such capacity,
the "Administrative Agent"),

The parties hereto hereby agree as follows:

SECTION 1 DEFINITIONS AND ACCOUNTING TERMS

1.1       Definitions.

As used herein, the following terms shall have the meanings herein specified
unless the context otherwise requires. Defined terms herein shall include in the
singular number the plural and in the plural the singular:

 

Page 2

"Adjusted Base Rate" means the Base Rate plus the Base Rate Applicable
Percentage.

"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the Eurodollar Rate
Applicable Percentage.

"Administrative Agent" means Barclays and its successors and assigns in such
capacity.

"Affiliate" means, with respect to any Person, any other Person directly or
indirectly controlling (including but not limited to all directors and officers
of such Person), controlled by or under direct or indirect common control with
such Person. A Person shall be deemed to control a corporation if such Person
possesses, directly or indirectly, the power (i) to vote 20% or more of the
securities having ordinary voting power for the election of directors of such
corporation or (ii) to direct or cause direction of the management and policies
of such corporation, whether through the ownership of voting securities, by
contract or otherwise.

"Applicable L/C Floor Fee" means a fixed percentage based on the Borrower's
Ratings, as set forth under the heading "Applicable L/C Floor Fee" in the table
included in the definition of Applicable Percentage.

"Applicable Percentage" means, at any time for Loans made to, and Commitment
Fees or Letter of Credit Fees payable by, the Borrower, as the case may be, the
percentage therefor set forth below corresponding to the long term, senior
unsecured, non-credit enhanced debt ratings of the Borrower in effect at such
time; provided, that the Eurodollar Rate Applicable Percentage applicable to a
Eurodollar Loan, once determined, shall remain set for the duration of the
selected Interest Period.

Category

Senior Unsecured Debt Rating by S&P/Moody's

Applicable Commitment Fee

Applicable L/C Floor Fee

Floor

Ceiling

I

>

A / A2

0.100%

0.550%

0.350%

1.350%

II

A- / A3

0.125%

0.675%

0.500%

1.500%

III

BBB+ / Baa1

0.150%

0.875%

0.625%

2.625%

IV

BBB / Baa2

0.175%

1.000%

0.750%

2.750%

V

BBB- / Baa3

0.200%

1.250%

0.875%

2.875%

VI

BB+ / Ba1 or below

0.30%

1.875%

1.500%

6.500%

 

Page 3

Notwithstanding the above, if at any time there is a split in Ratings of one
level, related to Categories I through V, between S&P and Moody's, the Floor and
Ceiling in effect at any time will be determined based upon the higher rating,
and if at any time there is a split in Ratings of two or more levels, related to
Categories I through V, between S&P and Moody's, the Floor and Ceiling in effect
at any time shall be determined based upon the Ratings level that is one level
below the higher of the S&P or Moody's rating. If at any time either S&P or
Moody's rates the Borrower at a Category VI level, the Floor and Ceiling in
effect at any time will be based on Category VI levels.

The Borrower shall deliver to the Administrative Agent (and the Administrative
Agent shall notify each Lender), at the address set forth on Schedule 12.1,
information regarding any change in its Ratings within five Business Days of
receipt of such information. The Administrative Agent may assume that Ratings
remain in effect unless the Borrower notifies the Administrative Agent in
writing that a Rating of the Borrower has changed.

"Application" means an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to issue a Letter of
Credit.

"Asset Swap Spread" for the Borrower on any day means the amount in basis points
resulting from the conversion by the Administrative Agent of the Price of the
Benchmark Bond (if four or more price quotes are received) into an asset swap
spread using the Bloomberg "YAS" screen as follows: The Price will be entered in
the "PRICE" field, the appropriate settlement date (which will be the third
Business Day after the date such Price is determined) will be entered into the
"SETTLE" field, and "I52" will be entered in the "CRV#" field. The resulting
amount in the "ASSET SWAP" field, rounded to the nearest basis point, is the
Asset Swap Spread. If fewer than four quotes are obtained, the Asset Swap Spread
for such day will be equal to the applicable Ceiling for the Borrower. If the
Bloomberg YAS function shall not be available, the Administrative Agent will
solicit spot mid swap rates of a maturity that matches the maturity of the
Benchmark Bond ("Spot Mid Swap Rates") from Barclays Capital and two other
Eligible Dealers. The Asset Swap Spread for such day will be equal to the
implied yield derived from the Price minus the average of the three Spot Mid
Swap Rates, rounded to the nearest basis point.

"Average Asset Swap Spread" for any Interest Period for any Eurodollar Loan
means the arithmetic average of the two daily Asset Swap Spreads resulting from
the Pricing Polls for the applicable Notice Date.

"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United States
Code, as amended, modified, succeeded or replaced from time to time.

"Barclays" has the meaning set forth in the preamble hereof.

"Barclays Capital" has the meaning set forth in the preamble hereof.

 

Page 4

"Base Rate" means, for any day, a simple rate per annum equal to the greater of
(a) the Prime Rate for such day or (b) the sum of one-half of one percent (.50%)
plus the Federal Funds Rate for such day.

"Base Rate Applicable Percentage" means for any day a percentage equal to the
Ceiling minus 100 basis points per annum.

"Base Rate Loan" means a Loan that bears interest at an Adjusted Base Rate.

"Benchmark Bond" means the Borrower's 5.00% Senior Notes due March 1, 2014
(CUSIP No. 209615BZ5).

If (a) the Benchmark Bond shall no longer be outstanding for any reason,
including maturity, redemption or repurchase, (b) the Borrower shall issue a new
senior, unsecured, non-credit enhanced obligation having liquidity and tenor
deemed more acceptable to the Administrative Agent, (c) the Administrative Agent
shall receive a written request from the Borrower requesting that the
Administrative Agent replace the Borrower's Benchmark Bond with another
Acceptable Obligation of the Borrower, and the Administrative Agent so agrees in
its sole discretion, or (d) the Administrative Agent shall determine that, as a
result of changes in the liquidity of the Benchmark Bond, price quotes for the
Benchmark Bond are not consistently available, and if in any such case one or
more other (i.e. other than the Benchmark Bond) acceptable debt securities of
the Borrower ("Acceptable Obligations") shall be outstanding for which price
quotes are likely, in the judgment of the Administrative Agent, to be
consistently available, then the Administrative Agent, in consultation with the
Borrower, will replace the Benchmark Bond with another Acceptable Obligation of
the Borrower. If the Administrative Agent shall determine that no Acceptable
Obligation is outstanding for the Borrower, the Eurodollar Rate Applicable
Percentage for the Borrower will equal the Ceiling.

"Benefitted Lender" has the meaning set forth in Section 12.2 hereof.

"Borrower" has the meaning set forth in the preamble hereof.

"Business Day" means any day other than a Saturday, a Sunday, a legal holiday or
a day on which banking institutions are authorized or required by law or other
governmental action to close in New York, New York or, solely for purposes of
the issuance of any Letter of Credit by KeyBank, Cleveland, Ohio; provided that
in the case of Eurodollar Loans, such day is also a day on which dealings
between banks are carried on in Dollar deposits in the London interbank market.

"Capital Stock" means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.

"Capitalization" means the sum of (a) Total Funded Debt plus (b) Net Worth.

"Ceiling" for any day for any Borrower means the percentage as set forth under
the heading "Ceiling" in the table included in the definition of Applicable
Percentage.

 

Page 5

"Change of Control" means either: (i) the Borrower shall cease to be a
Subsidiary of Dominion Resources or (ii) any person (as such term is defined in
Section 13(d) of the Securities and Exchange Act of 1934, as amended) shall
acquire, directly or indirectly, beneficial ownership of more than 50% of the
outstanding shares of the capital stock of Dominion Resources entitled to vote
generally for the election of directors of Dominion Resources.

"Closing Date" means the date hereof.

"Code" means the Internal Revenue Code of 1986, as amended from time to time.

"Commitment" means, with respect to each Lender, such Lender's share of the Loan
Commitment based upon such Lender's Commitment Percentage.

"Commitment Fees" has the meaning set forth in Section 3.4(a).

"Commitment Percentage" means, for each Lender, the percentage identified as its
Commitment Percentage opposite such Lender's name on Schedule 1.1 attached
hereto, as such percentage may be modified by assignment in accordance with the
terms of this Credit Agreement.

"Consolidated Subsidiary" means, as to any Person, each Subsidiary of such
Person (whether now existing or hereafter created or acquired), the financial
statements of which are or are required to be consolidated with the financial
statements of such Person in accordance with GAAP, including principles of
consolidation.

"Controlled Group" means (i) the controlled group of corporations as defined in
Section 414(b) of the Code and the applicable regulations thereunder or (ii) the
group of trades or businesses under common control as defined in Section 414(c)
of the Code and the applicable regulations thereunder, of which the Borrower is
a part or may become a part.

"Credit Documents" means this Credit Agreement, the Loan Notes, and all other
related agreements and documents issued or delivered hereunder or thereunder or
pursuant hereto or thereto.

"Credit Exposure" has the meaning set forth in the definition of "Required
Lenders" below.

"Default" means any event, act or condition which with notice or lapse of time,
or both, would constitute an Event of Default.

"Defaulting Lender" means, at any time, any Lender that, at such time (a) has
failed to make a Loan required pursuant to the terms of this Credit Agreement,
(b) has failed to pay to the Administrative Agent or any Lender an amount owed
by such Lender pursuant to the terms of this Credit Agreement or (c) has been
deemed insolvent or has become subject to a bankruptcy or insolvency proceeding
or to a receiver, trustee or similar official.

"Dollar", "dollar" and "$" means lawful currency of the United States.

 

Page 6

"Dominion Resources or DRI" means Dominion Resources, Inc., a Virginia
corporation, and its successors and permitted assigns.

"Effective Date" has the meaning set forth in Section 12.15 hereof.

"Eligible Assignee" means:

any Lender or Affiliate or Subsidiary of a Lender; and

any other commercial bank, financial institution or "accredited investor" (as
defined in Regulation D promulgated by the Securities and Exchange Commission)
that is either a bank organized or licensed under the laws of the United States
of America or any State thereof or that has agreed to provide the information
listed in Section 4.4(d) to the extent that it may lawfully do so and that is
approved by the Administrative Agent and the Borrower (each such approval not to
be unreasonably withheld or delayed);

provided

that, for purposes of:

clause (b), the Borrower's consent is not required during the existence and
continuation of a Default or an Event of Default;

clause (a) and clause (b), no person or entity shall be an Eligible Assignee
without the consent of the Issuing Lenders, which consent may be given or
withheld in the sole discretion of the Issuing Lenders; and

clause (a) and clause (b), neither the Borrower nor any Affiliate or Subsidiary
of the Borrower shall qualify as an Eligible Assignee.

"Eligible Dealers" means the dealers listed on Schedule 1.1A, attached hereto,
as such dealers may be replaced or added to with the consent of the
Administrative Agent and the Borrower.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and the rulings issued
thereunder.

"ERISA Affiliate" means each person (as defined in Section 3(9) of ERISA) which
together with the Borrower or any Subsidiary of the Borrower would be deemed to
be a member of the same "controlled group" within the meaning of Section 414(b),
(c), (m) and (o) of the Code.

"Eurodollar Loan" means a Loan bearing interest at a rate of interest determined
by reference to the Eurodollar Rate.

"Eurodollar Rate" means with respect to any Eurodollar Loan, for the Interest
Period applicable thereto, a rate per annum determined pursuant to the following
formula:

"Eurodollar Rate" = Interbank Offered Rate         
                 1 - Eurodollar Reserve Percentage

 

Page 7

"Eurodollar Rate Applicable Percentage" for any Interest Period for a Eurodollar
Loan means a percentage equal to the greater of (a) the applicable Floor or (b)
the applicable Average Asset Swap Spread, provided that such percentage shall in
no event be greater than the Ceiling.

"Eurodollar Reserve Percentage" means, for any day, that percentage (expressed
as a decimal) which is in effect from time to time under Regulation D, as such
regulation may be amended from time to time or any successor regulation, as the
maximum reserve requirement (including, without limitation, any basic,
supplemental, emergency, special, or marginal reserves) applicable with respect
to Eurocurrency liabilities as that term is defined in Regulation D (or against
any other category of liabilities that includes deposits by reference to which
the interest rate of Eurodollar Loans is determined), whether or not any Lender
has any Eurocurrency liabilities subject to such reserve requirement at that
time. Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities
and as such shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may be available from time to
time to a Lender. The Eurodollar Rate shall be adjusted automatically on and as
of the effective date of any change in the Eurodollar Reserve Percentage.

"Eurodollar Loan" means a Loan bearing interest at a rate of interest determined
by reference to the Eurodollar Rate.

"Event of Default" has the meaning specified in Section 10.1.

"Exchange Act" means the Securities and Exchange Act of 1934, as amended.

"Existing Credit Agreement" means the Borrower's $1,000,000,000 364-Day Credit
Facility, dated as of August 20, 2003, among the several lenders from time to
time parties thereto, Barclays, as Administrative Agent, and Barclays and Bank
One, NA, as Syndication Agents.

"Federal Funds Rate" means for any day the rate per annum (rounded upward to the
nearest 1/100th of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers on such day, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided that (a) if
such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the immediately preceding Business Day and (b)
if no such rate is so published on such next succeeding Business Day, the
Federal Funds Rate for such day shall be the average rate quoted to the
Administrative Agent on such day on such transactions as determined by the
Administrative Agent.

"Floor" for any day means the minimum Eurodollar Rate Applicable Percentage,
based on the Borrower's Ratings, as set forth under the heading "Floor" in the
table included in the definition of Applicable Percentage.

"Funded Debt" means, as to any Person, without duplication: (a) all Indebtedness
of such Person for borrowed money or which has been incurred in connection with
the acquisition of assets (excluding letters of credit, bankers' acceptances,
Non-Recourse Debt, Mandatorily Convertible Securities and Trust Preferred
Securities), (b) all capital lease obligations (including Synthetic Lease
Obligations) of such Person and (c) all Guaranty Obligations of Funded Debt of
other Persons.

 

Page 8

"GAAP" means generally accepted accounting principles in the United States
applied on a consistent basis and subject to Section 1.3.

"Governmental Authority" means any Federal, state, local or foreign court or
governmental agency, authority, instrumentality or regulatory body.

"Granting Lender" has the meaning set forth in Section 12.18 hereof.

"Group Facility" means the Three-Year Credit Agreement, dated as of May 27,
2004, among DRI, Virginia Electric and Power Company, the Borrower, the lenders
from time to time parties thereto, JPMorgan Chase Bank, as Administrative Agent
and Barclays, as Syndication Agent.

"Guaranty Obligations" means, in respect of any Person, any obligation,
contingent or otherwise, of such Person directly or indirectly guaranteeing any
Indebtedness of another Person, including, without limitation, any obligation
(a) to purchase or pay, or advance or supply funds for the purchase or payment
of, such Indebtedness or (b) entered into primarily for the purpose of assuring
the owner of such Indebtedness of the payment thereof (such as, for example, but
without limitation, an agreement to advance or provide funds or other support
for the payment or purchase of such Indebtedness or to maintain working capital,
solvency or other balance sheet conditions of such other Person, including,
without limitation, maintenance agreements, comfort letters or similar
agreements or arrangements, or to lease or purchase property, securities or
services) if such obligation would constitute an indirect guarantee of
indebtedness of others, the disclosure of which would be required in such
Person's financial statements under GAAP; provided, however, that the term
Guaranty Obligations shall not include (i) endorsements for deposit or
collection in the ordinary course of business, (ii) obligations under purchased
power contracts or (iii) obligations of the Borrower otherwise constituting
Guaranty Obligations under this definition to provide contingent equity support,
to keep well, to purchase assets, goods, securities or services, to take or pay
or to maintain financial statement conditions or otherwise in respect of any
Subsidiary or Affiliate of the Borrower in connection with the non-utility
nonrecourse financing activities of such Subsidiary or Affiliate.

"Indebtedness" means, as to any Person, without duplication: (a) all obligations
of such Person for borrowed money or evidenced by bonds, debentures, notes or
similar instruments; (b) all obligations of such Person for the deferred
purchase price of property or services (except trade accounts payable arising in
the ordinary course of business, customer deposits, provisions for rate refunds,
deferred fuel expenses and obligations in respect of pensions and other
post-retirement benefits); (c) all capital lease obligations of such Person; (d)
all Indebtedness of others secured by a Lien on any properties, assets or
revenues of such Person (other than stock, partnership interests or other equity
interests of the Borrower or any of its Subsidiaries in other entities) to the
extent of the lesser of the value of the property subject to such Lien or the
amount of such Indebtedness; (e) all Guaranty Obligations; and (f) all
non-contingent obligations of such Person under any letters of credit or
bankers' acceptances.

 

Page 9

"Indenture" means the Indenture dated as of April 1, 1995 between the Borrower
and United States Trust Company of New York, as Trustee, as in effect on the
date hereof and without giving effect to any modifications or supplements
thereto, or terminations thereof, after the date hereof.

"Interbank Offered Rate" means, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period; provided, however, if more
than one rate is specified on Telerate Page 3750, the applicable rate shall be
the arithmetic mean of all such rates. If, for any reason, such rate is not
available, the term "Interbank Offered Rate" shall mean, for any Eurodollar Loan
for any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period; provided, however, if more
than one rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates (rounded upwards, if necessary,
to the nearest 1/100 of 1%).

"Interest Payment Date" means (a) as to Base Rate Loans, the last day of each
fiscal quarter of the Borrower and the Maturity Date, and (b) as to Eurodollar
Loans, the last day of each applicable Interest Period, and the Maturity Date.
If an Interest Payment Date falls on a date which is not a Business Day, such
Interest Payment Date shall be deemed to be the next succeeding Business Day,
except that in the case of Eurodollar Loans where such next succeeding Business
Day falls in the next succeeding calendar month, then such Interest Payment Date
shall be deemed to be the immediately preceding Business Day.

"Interest Period" means, as to Eurodollar Loans, a period of 14 days (in the
case of new money borrowings) or one, two or three months' duration, as the
Borrower may elect, commencing, in each case, on the date of the borrowing
(including continuations and conversions of Eurodollar Loans); provided,
however, (i) if any Interest Period would end on a day which is not a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next succeeding
calendar month, then such Interest Period shall end on the next preceding
Business Day), (ii) no Interest Period shall extend beyond the Maturity Date and
(iii) with respect to Eurodollar Loans, where an Interest Period begins on a day
for which there is no numerically corresponding day in the calendar month in
which the Interest Period is to end, such Interest Period shall end on the last
Business Day of such calendar month.

"Issuing Lender" means, with respect to any Letter of Credit, the issuer
thereof, which shall be Barclays, KeyBank, SunTrust and/or any other Lender that
agrees to act as an issuing Lender hereunder with the consent of the Borrower,
the other Issuing Lenders and the Administrative Agent.

"Joint Lead Arrangers" means Barclays Capital and KeyBank.

 

Page 10

"KeyBank" has the meaning set forth in the preamble hereof.

"L/C Applicable Percentage" for any Letter of Credit means the percentage equal
at all times to the higher of:

the Applicable L/C Floor Fee; and

whichever of the following shall apply:

if Eurodollar Loans are outstanding under this Credit Agreement, the Eurodollar
Rate Applicable Percentage (and, if more than one Eurodollar Rate Applicable
Percentage is then in effect, the most recently determined of such Eurodollar
Rate Applicable Percentage); or

if the only Loans outstanding under this Credit Agreement are Base Rate Loans,
the Base Rate Applicable Percentage; or

if no Loans are outstanding under this Credit Agreement, but revolving loans are
outstanding to the Borrower under the Group Facility, a variable percentage
equal to the Average Asset Swap Spread (but in any event no greater than the
Ceiling), determined on the date such revolving loans are made and on the first
day of each subsequent interest period applicable thereto;

provided

, however, that if at any time there shall be no Loans outstanding under this
Credit Agreement and no revolving loans outstanding to the Borrower under the
Group Facility, the L/C Applicable Percentage shall be determined pursuant to
clause (a), above. The L/C Applicable Percentage shall change on any day on
which the calculation thereof would change by reason of the making, prepayment
or repayment of Eurodollar Loans, Base Rate Loans or revolving loans under the
Group Facility as set forth above.

"L/C Commitment" means $1,500,000,000.

"L/C Fee Payment Date" means each of the first Business Day of each January,
April, July and October (as well as on the Maturity Date).

"L/C Obligations" means, at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit that
have not then been reimbursed pursuant to Section 5.5.

"L/C Participants" means, with respect to any Letter of Credit, the collective
reference to all the Lenders other than the Issuing Lender.

 

Page 11

"Lenders" means those banks and other financial institutions identified as such
on the signature pages hereto and such other institutions that may become
Lenders pursuant to Section 12.3.

"Letter of Credit" has the meaning set forth in Section 5.1(a) hereof.

"Letter of Credit Fees" has the meaning set forth in Section 5.3(a) hereof.

"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the Uniform Commercial Code
as adopted and in effect in the relevant jurisdiction or other similar recording
or notice statute, and any lease in the nature thereof).

"Loan" means any loan made by any Lender to the Borrower pursuant to Section 2.1
hereof.

"Loan Commitment" means One Billion Five Hundred Million Dollars
($1,500,000,000), which amount includes the L/C Commitment, as such amount may
be otherwise reduced in accordance with Section 2.5.

"Loan Notes" means the promissory notes of the Borrower in favor of each Lender
evidencing the Loans made to the Borrower and substantially in the form of
Exhibit 2.6(a), as such promissory notes may be amended, modified, supplemented
or replaced from time to time.

"Mandatorily Convertible Securities" means any mandatorily convertible
equity-linked securities issued by the Borrower, so long as the terms of such
securities require no repayments or prepayments and no mandatory redemptions or
repurchases, in each case prior to at least 91 days after the later of the
termination of the Commitments and the repayment in full of the Loans and all
other amounts due under this Credit Agreement.

"Material Adverse Effect" means a material adverse effect, after taking into
account applicable insurance, if any, on (a) the operations, financial condition
or business of the Borrower, (b) the ability of the Borrower to perform its
obligations under this Credit Agreement or (c) the validity or enforceability of
this Credit Agreement or any of the other Credit Documents against the Borrower,
or the rights and remedies of the Lenders against the Borrower hereunder or
thereunder.

"Material Plan" has the meaning set forth in Section 10.1(h) hereof.

"Material Subsidiary" shall mean a Subsidiary of the Borrower whose total assets
(as determined in accordance with GAAP) represent at least 20% of the total
assets of the Borrower, on a consolidated basis.

"Maturity Date" means August 10, 2007.

 

Page 12

 "Moody's" means Moody's Investors Service, Inc., or any successor or assignee
of the business of such company in the business of rating securities.

"Multiemployer Plan" means at any time an employee pension benefit plan within
the meaning of Section 4001(a)(3) of ERISA to which any member of the Controlled
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the Controlled Group during
such five year period but only with respect to the period during which such
Person was a member of the Controlled Group.

"Net Worth" means, as of any date, the shareholders' equity or net worth of the
Borrower and its Consolidated Subsidiaries, on a consolidated basis, as
determined in accordance with GAAP (including Mandatorily Convertible Securities
and Trust Preferred Securities).

"1935 Act" means the Public Utility Holding Company Act of 1935, as amended.

"Non-Recourse Debt" means Indebtedness (a) as to which the Borrower (i) does not
provide credit support of any kind (including any undertaking, agreement or
instrument that would constitute Indebtedness), (ii) is not directly or
indirectly liable as a guarantor or otherwise, and (iii) is not the lender; (b)
in respect of which default would not permit (whether upon notice, lapse of time
or both) any holder of any other Indebtedness (other than the Loans or the Loan
Notes) of the Borrower to declare a default on such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its stated maturity;
and (c) as to which the lenders have been notified in writing that they will not
have any recourse to the stock or assets of the Borrower.

"Notice Date" has the meaning set forth in Section 2.2(b) hereof.

"Notice of Borrowing" means a request by the Borrower for a Loan in the form of
Exhibit 2.2(a).

"Notice of Continuation/Conversion" means a request by the Borrower for the
continuation or conversion of a Loan in the form of Exhibit 2.2(c).

"Other Taxes" has the meaning set forth in Section 4.4(b) hereof.

"PBGC" means the Pension Benefit Guaranty Corporation established under ERISA
and any successor thereto.

"Pension Plans" has the meaning set forth in Section 8.8 hereof.

"Person" means any individual, partnership, joint venture, firm, corporation,
limited liability company, association, trust or other enterprise (whether or
not incorporated), or any government or political subdivision or any agency,
department or instrumentality thereof.

"Plan" means any single-employer plan as defined in Section 4001 of ERISA, which
is maintained, or at any time during the five calendar years preceding the date
of this Credit Agreement was maintained, for employees of the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate of the Borrower.

 

Page 13

"Price" means, for the Benchmark Bond on any Business Day on which a Pricing
Poll occurs, the Dollar price resulting from bid quotes solicited beginning at
2:00 p.m. (or such other time as may be set by the Administrative Agent) on such
Business Day. If (a) five quotes are received, the Price for the Benchmark Bond
for such day shall be the arithmetic average, as computed by the Administrative
Agent, of the three quotes remaining after the highest and lowest quotes are
excluded, or (b) four quotes are obtained, the Price for the Benchmark Bond for
such day shall be the arithmetic average, as computed by the Administrative
Agent, of the three quotes remaining after the lowest quote is excluded. The
Administrative Agent agrees to solicit such quotes on each of the two Business
Days immediately following a Notice Date; provided, that upon receipt by the
Administrative Agent of written consent from the Borrower, the Eurodollar Rate
Applicable Percentage for the Borrower will equal the Ceiling and no Pricing
Poll shall be required.

"Pricing Poll" means the solicitation by the Administrative Agent on each of the
two Business Days immediately following the Notice Date of Prices for the
Benchmark Bond from five Eligible Dealers as selected by the Borrower.

"Prime Rate" means the per annum rate of interest established from time to time
by Barclays at its principal office in New York, New York as its Prime Rate. Any
change in the interest rate resulting from a change in the Prime Rate shall
become effective as of 12:01 a.m. of the Business Day on which each change in
the Prime Rate is announced by the Administrative Agent. The Prime Rate is a
reference rate used by the Administrative Agent in determining interest rates on
certain loans and is not intended to be the lowest rate of interest charged on
any extension of credit to any debtor.

"Ratings" means the rating assigned by S&P or Moody's to the Borrower based on
the Borrower's senior, unsecured, non-credit enhanced obligations.

"Refund" has the meaning set forth in Section 4.4(c) hereof.

"Register" has the meaning set forth in Section 12.3(c).

"Regulation A, D, T, U or X" means Regulation A, D, T, U or X, respectively, of
the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.

"Reimbursement Obligation" means the obligation of the Borrower to reimburse the
Issuing Lenders pursuant to Section 5.5 for amounts drawn under Letters of
Credit.

"Reportable Event" means a "reportable event" as defined in Section 4043 of
ERISA with respect to which the notice requirements to the PBGC have not been
waived.

"Required Lenders" means Lenders whose aggregate Credit Exposure (as hereinafter
defined) constitutes more than 50% of the aggregate Credit Exposure of all
Lenders at such time; provided, however, that if any Lender shall be a
Defaulting Lender at such time then there shall be excluded from the
determination of Required Lenders the aggregate Credit Exposure of such Lender
at such time. For purposes of the preceding sentence, the term "Credit Exposure"
as applied to each Lender shall mean (a) at any time prior to the termination of
the Commitments, the Commitment Percentage of such Lender multiplied by the Loan
Commitment and (b) at any time after the termination of the Commitments, the
outstanding principal amount of Loans and L/C Obligations owed to such Lender.

 

Page 14

"S&P" means Standard & Poor's Ratings Services, a division of The McGraw Hill
Companies, Inc., or any successor or assignee of the business of such division
in the business of rating securities.

"Solvent" means, with respect to any Person as of a particular date, that on
such date (a) the fair saleable value (on a going concern basis) of such
Person's assets exceeds its liabilities, contingent or otherwise, fairly valued,
(b) such Person will be able to pay its debts as they become due, (c) such
Person does not have unreasonably small capital with which to satisfy all of its
current and reasonably anticipated obligations and (d) such Person does not
intend to incur nor does it reasonably anticipate that it will incur debts
beyond its ability to pay as such debts become due.

"Spot Mid Swap Rates" has the meaning set forth in the definition of "Asset Swap
Spread".

"SPV" has the meaning set forth in Section 12.18 hereof.

"Stated Amount" of each Letter of Credit means, at any time, the maximum amount
available to be drawn thereunder (in each case determined without regard to
whether any conditions to drawing could be met).

"Subsidiary" means, as to any Person, (a) any corporation more than 50% of whose
stock of any class or classes having by the terms thereof ordinary voting power
to elect a majority of the directors of such corporation (irrespective of
whether or not at the time, any class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time owned by such Person directly or indirectly through Subsidiaries and
(b) any partnership, association, joint venture or other entity in which such
person directly or indirectly through Subsidiaries has more than 50% equity
interest at any time.

"SunTrust" has the meaning set forth in the preamble hereof.

"Synthetic Lease" means each arrangement, however described, under which the
obligor accounts for its interest in the property covered thereby under GAAP as
lessee of a lease which is not a capital lease under GAAP and accounts for its
interest in the property covered thereby for federal income tax purposes as the
owner.

"Synthetic Lease Obligation" means, as to any Person with respect to any
Synthetic Lease at any time of determination, the amount of the liability of
such Person in respect of such Synthetic Lease that would (if such lease was
required to be classified and accounted for as a capital lease on a balance
sheet of such Person in accordance with GAAP) be required to be capitalized on
the balance sheet of such Person at such time.

 

Page 15

"Taxes" has the meaning set forth in Section 4.4(a).

"Total Funded Debt" means all Funded Debt of the Borrower and its Consolidated
Subsidiaries, on a consolidated basis, as determined in accordance with GAAP.

"Trust Preferred Securities" means the trust preferred securities issued by one
of the five subsidiary capital trusts established by the Borrower outstanding on
the date hereof and reflected as such in the financial statements of Dominion
Resources for the fiscal year ended December 31, 2003, and any additional trust
preferred securities that are substantially similar thereto, along with the
junior subordinated debt obligations of the Borrower, so long as (a) the terms
thereof require no repayments or prepayments and no mandatory redemptions or
repurchases, in each case prior to at least 91 days after the later of the
termination of the Commitments and the repayment in full of the Loans,
Reimbursement Obligations and all other amounts due under the Credit Agreement,
(b) such securities are subordinated and junior in right of payment to all
obligations of the Borrower for or in respect of borrowed money and (c) the
obligors in respect of such preferred securities and subordinated debt have the
right to defer interest and dividend payments, in each case to substantially the
same extent as such currently outstanding preferred securities or on similar
terms customary for trust preferred securities and not materially less favorable
to the interests of the Borrower or the Lenders.

"Utilized Commitment" means, for any day from the Closing Date to the Maturity
Date, an amount equal to the sum of (a) the aggregate principal amount of all
Loans outstanding on such day to the Borrower and (b) the aggregate L/C
Obligations then outstanding.

"Wholly Owned Subsidiary" means, as to any Person, any other Person all of the
Capital Stock of which (other than de minimis directors' qualifying shares or
local ownership shares required by law) is owned by such Person directly and/or
through other Wholly Owned Subsidiaries.

1.2 Computation of Time Periods; Other Definitional Provisions.

For purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding." References in this Credit Agreement to "Sections", "Schedules" and
"Exhibits" shall be to Sections, Schedules or Exhibits of or to this Credit
Agreement unless otherwise specified.

1.3 Accounting Terms.

Except as otherwise expressly provided herein, all accounting terms used herein
shall be interpreted, and all financial statements and certificates and reports
as to financial matters required to be delivered to the Lenders hereunder shall
be prepared, in accordance with GAAP applied on a consistent basis. All
calculations made for the purposes of determining compliance with this Credit
Agreement shall (except as otherwise expressly provided herein) be made by
application of GAAP applied on a basis consistent with the most recent annual or
quarterly financial statements delivered pursuant to Section 8.1 (or, prior to
the delivery of the first financial statements pursuant to Section 8.1,
consistent with the financial statements described in Section 6.1(g)); provided,
however, if (a) the Borrower shall object to determining such compliance on such
basis at the time of delivery of such financial statements due to any change in
GAAP or the rules promulgated with respect thereto or (b) the Administrative
Agent or the Required Lenders shall so object in writing within 30 days after
delivery of such financial statements, then such calculations shall be made on a
basis consistent with the most recent financial statements delivered by the
Borrower to the Lenders as to which no such objection shall have been made.

Page 16

1.4  Time.

All references to time herein shall be references to Eastern Standard Time or
Eastern Daylight time, as the case may be, unless specified otherwise.

SECTION 2 LOANS

2.1      Loan Commitment.

Subject to the terms and conditions set forth herein, each Lender severally
agrees to make Loans to the Borrower in Dollars, at any time and from time to
time, during the period from the Closing Date to the Maturity Date (each, a
"Loan" and collectively, the "Loans"); provided that (i) the sum of the
aggregate amount of Loans outstanding to the Borrower plus the L/C Obligations
then outstanding on any day shall not exceed the Loan Commitment and (ii) with
respect to each individual Lender, the Lender's pro rata share of the sum of
outstanding Loans plus the L/C Obligations then outstanding on any day shall not
exceed such Lender's Commitment Percentage of the Loan Commitment. Subject to
the terms and conditions of this Credit Agreement, the Borrower may borrow,
repay and reborrow the amount of the Loan Commitment made to it.

2.2      Method of Borrowing for Loans.

Base Rate Loans. By no later than 10:00 a.m. on the date of a request for
borrowing (or for the conversion of Eurodollar Loans to Base Rate Loans), the
Borrower shall submit a Notice of Borrowing to the Administrative Agent setting
forth (i) the amount requested, (ii) the desire to have such Loans accrue
interest at the Base Rate and (iii) except in the case of conversions of
Eurodollar Loans to Base Rate Loans, complying in all respects with Section 6.2
hereof.

Eurodollar Loans

. By no later than 11:00 a.m. three Business Days prior to the date of a
borrowing (or for the conversion of Base Rate Loans to Eurodollar Loans or the
continuation of existing Eurodollar Loans) (the "
Notice Date
"), the Borrower shall submit a Notice of Borrowing to the Administrative Agent
(x) setting forth (i) the amount requested, (ii) the desire to have such Loans
accrue interest at the Adjusted Eurodollar Rate, and (iii) the Interest Period
applicable thereto, and (y) except in the case of conversions of Base Rate Loans
to Eurodollar Loans or the continuation of existing Eurodollar Loans, complying
in all respects with Section 6.2 hereof.

Continuation and Conversion

. The Borrower shall have the option, on any Business Day, to continue existing
Eurodollar Loans made to it for a subsequent Interest Period, to convert Base
Rate Loans made to it into Eurodollar Loans or to convert Eurodollar Loans made
to it into Base Rate Loans. By no later than 11:00 a.m. (a) on the date of the
requested conversion of a Eurodollar Loan to a Base Rate Loan or (b) three
Business Days prior to the date for a requested continuation of a Eurodollar
Loan or conversion of a Base Rate Loan to a Eurodollar Loan, the Borrower shall
provide telephonic notice to the Administrative Agent, followed promptly by a
written Notice of Continuation/Conversion, setting forth (i) whether the
Borrower wishes to continue or convert such Loans and (ii) if the request is to
continue a Eurodollar Loan or convert a Base Rate Loan to a Eurodollar Loan, the
Interest Period applicable thereto. Notwithstanding anything herein to the
contrary, (i) except as provided in Section 4.1 hereof, Eurodollar Loans may be
converted to Base Rate Loans only on the last day of an Interest Period
applicable thereto; (ii) Eurodollar Loans may be continued and Base Rate Loans
may be converted to Eurodollar Loans only if no Default or Event of Default is
in existence on the date of such extension or conversion; (iii) any continuation
or conversion must comply with Sections 2.2(a) or 2.2(b) hereof, as applicable;
and (iv) failure by the Borrower to properly continue Eurodollar Loans at the
end of an Interest Period shall be deemed a conversion to Base Rate Loans.

Page 17

2.3     Funding of Loans.

Upon receipt of a Notice of Borrowing, the Administrative Agent shall promptly
inform the Lenders as to the terms thereof. Each Lender will make its pro rata
share of the Loans available to the Administrative Agent by 2:00 p.m. on the
date specified in the Notice of Borrowing by deposit (in Dollars) of immediately
available funds at the offices of the Administrative Agent at its principal
office in New York, New York, or at such other address as the Administrative
Agent may designate in writing. All Loans shall be made by the Lenders pro rata
on the basis of each Lender's Commitment Percentage.

No Lender shall be responsible for the failure or delay by any other Lender in
its obligation to make Loans hereunder; provided, however, that the failure of
any Lender to fulfill its obligations hereunder shall not relieve any other
Lender of its obligations hereunder. Unless the Administrative Agent shall have
been notified by any Lender prior to the date of any such Loan that such Lender
does not intend to make available to the Administrative Agent its portion of the
Loans to be made on such date, the Administrative Agent may assume that such
Lender has made such amount available to the Administrative Agent on the date of
such Loans, and the Administrative Agent in reliance upon such assumption, may
(in its sole discretion without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent, the Administrative Agent shall be
able to recover such corresponding amount from such Lender. If such Lender does
not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the Borrower and
the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from the Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent at a per
annum rate equal to (a) from the Borrower at the applicable rate for such Loan
pursuant to the Notice of Borrowing and (b) from a Lender at the Federal Funds
Rate.

Page 18

2.4     Minimum Amounts of Loans.

Each request for Loans shall be in the case of Eurodollar Loans, in an aggregate
principal amount that is not less than the lesser of $10,000,000 or the
remaining amount available to be borrowed and in the case of Base Rate Loans, in
an aggregate principal amount that is not less than the lesser of $5,000,000 or
the remaining amount available to be borrowed. Any Loan requested shall be in an
integral multiple of $1,000,000 unless the request is for all of the remaining
amount available to be borrowed.

2.5     Reductions of Loan Commitment.

Upon at least three Business Days' notice, the Borrower shall have the right to
permanently terminate or reduce the aggregate unused amount of the Loan
Commitment available to it at any time or from time to time; provided that (a)
each partial reduction shall be in an aggregate amount at least equal to
$10,000,000 and in integral multiples of $1,000,000 above such amount and (b) no
reduction shall be made which would reduce the Loan Commitment to an amount less
than the sum of the then outstanding Loans. Any reduction in (or termination of)
the Loan Commitment shall be permanent and may not be reinstated.

2.6     Loan Notes.

The Loans made by any Lender shall be evidenced, upon request by such Lender, by
a promissory note of the Borrower payable to such Lender in substantially the
form of Exhibit 2.6(a) hereto (a "Loan Note") and in a principal amount equal to
the amount of such Lender's Commitment Percentage of the Loan Commitment as
originally in effect.

The date, amount, type, interest rate and duration of Interest Period (if
applicable) of each Loan made by each Lender to the Borrower, and each payment
made on account of the principal thereof, shall be recorded by such Lender on
its books; provided that the failure of such Lender to make any such recordation
or endorsement shall not affect the obligations of the Borrower to make a
payment when due of any amount owing hereunder or under any Loan Note, and each
such recordation or endorsement shall be conclusive and binding absent manifest
error.

SECTION 3 PAYMENTS

3.1       Interest.

Interest Rate.

All Base Rate Loans shall accrue interest at the Adjusted Base Rate.

All Eurodollar Loans shall accrue interest at the Adjusted Eurodollar Rate.

b. Default Rate of Interest. Upon the occurrence, and during the continuance, of
an Event of Default, the principal of and, to the extent permitted by law,
interest on the Loans, Reimbursement Obligations and any other amounts owing by
the Borrower hereunder or under the other Credit Documents shall bear interest,
payable on demand, at a per annum rate equal to 2% plus the rate which would
otherwise be applicable (or if no rate is applicable, then the Adjusted Base
Rate plus 2% per annum).

c. Interest Payments. Interest on Loans shall be due and payable in arrears on
each Interest Payment Date.3.2

Page 19

3.2     Prepayments.

Voluntary Prepayments. The Borrower shall have the right to prepay Loans made to
it in whole or in part from time to time without premium or penalty; provided,
however, that (i) Eurodollar Loans may only be prepaid on three Business Days'
prior written notice to the Administrative Agent and any prepayment of
Eurodollar Loans will be subject to Section 4.3 hereof , (ii) each such partial
prepayment of Loans shall be in the minimum principal amount of $10,000,000 and
(iii) all prepayments shall be accompanied by all accrued and unpaid interest on
the principal prepaid. Amounts prepaid hereunder shall be applied as the
Borrower may elect; provided that if the Borrower fails to specify the
application of a voluntary prepayment then such prepayment shall be applied in
each case first to Base Rate Loans and then to Eurodollar Loans in direct order
of Interest Period maturities.

Mandatory Prepayments

. If at any time the amount of Loans outstanding plus the L/C Obligations then
outstanding exceeds the Loan Commitment, the Borrower shall immediately make a
principal payment to the Administrative Agent in the manner and in an amount
necessary to be in compliance with Section 2.1 hereof. Any payments made under
this Section 3.2(b) shall be subject to Section 4.3 hereof and shall be applied
first, to Base Rate Loans, and second, to Eurodollar Loans in direct order of
Interest Period maturities;
provided
, that if the aggregate principal amount of Loans then outstanding is less than
the amount of such excess (because L/C Obligations constitute a portion
thereof), the Borrower shall, to the extent of the balance of such excess,
replace outstanding Letters of Credit and/or deposit an amount in cash in a cash
collateral account established with the Administrative Agent for the benefit of
the Lenders on terms and conditions satisfactory to the Administrative Agent.
All prepayments shall be accompanied by all accrued and unpaid interest on the
principal prepaid.

3.3      Payment in Full at Maturity.

On the Maturity Date, the entire outstanding principal balance of all Loans,
together with accrued but unpaid interest and all other sums owing under this
Credit Agreement, shall be due and payable in full, unless accelerated sooner
pursuant to Section 10 hereof.

3.4      Fees.

Commitment Fees.

In consideration of the Loan Commitment being made available by the Lenders
hereunder, the Borrower agrees to pay to the Administrative Agent, for the pro
rata benefit of each Lender, a commitment fee for each day that will accrue on
the unutilized Loan Commitment (i.e., the amount of the Loan Commitment less the
outstanding aggregate principal amount of Loans and L/C Obligations) on such day
according to the per annum percentages set forth under the heading "Applicable
Commitment Fee" in the table included in the definition of "Applicable
Percentage" (the "Commitment Fee").

The accrued Commitment Fees shall be due and payable in arrears on the first
Business Day of each January, April, July and October (as well as on the
Maturity Date and on any date that the Loan Commitment is reduced) for the
immediately preceding fiscal quarter (or portion thereof), beginning with the
first of such dates to occur after the Closing Date.

 

Page 20

b. Administrative Fees. The Borrower agrees to pay to the Administrative Agent
an annual fee as agreed to between the Borrower and the Administrative Agent.

3.5   Place and Manner of Payments.

All payments of principal, interest, fees, expenses and other amounts to be made
by the Borrower under this Credit Agreement shall be received not later than
2:00 p.m. on the date when due in Dollars and in immediately available funds,
without setoff, deduction, counterclaim or withholding of any kind, by the
Administrative Agent at its offices in New York, New York. The Borrower shall,
at the time it makes any payment under this Credit Agreement, specify to the
Administrative Agent, the Loans, fees or other amounts payable by the Borrower
hereunder to which such payment is to be applied (and in the event that it fails
to specify, or if such application would be inconsistent with the terms hereof,
the Administrative Agent, shall distribute such payment to the Lenders in such
manner as it reasonably determines in its sole discretion).

3.6   Pro Rata Treatment.

Except to the extent otherwise provided herein, all Loans, each payment or
prepayment of principal of any Loan, each payment of interest on the Loans, each
payment of Commitment Fees and Letter of Credit Fees, each reduction of the Loan
Commitment, and each conversion or continuation of any Loans, shall be allocated
pro rata among the Lenders in accordance with the respective Commitment
Percentages.

3.7   Computations of Interest and Fees.

Except for Base Rate Loans, on which interest shall be computed on the basis of
a 365 or 366 day year as the case may be, all computations of interest and fees
hereunder shall be made on the basis of the actual number of days elapsed over a
year of 360 days.

It is the intent of the Lenders and the Borrower to conform to and contract in
strict compliance with applicable usury law from time to time in effect. All
agreements between the Lenders and the Borrower are hereby limited by the
provisions of this paragraph which shall override and control all such
agreements, whether now existing or hereafter arising and whether written or
oral. In no way, nor in any event or contingency (including but not limited to
prepayment or acceleration of the maturity of any obligation), shall the
interest taken, reserved, contracted for, charged, or received under this Credit
Agreement, under the Loan Notes or otherwise, exceed the maximum non-usurious
amount permissible under applicable law. If, from any possible construction of
any of the Credit Documents or any other document, interest would otherwise be
payable in excess of the maximum non-usurious amount, any such construction
shall be subject to the provisions of this paragraph and such documents shall be
automatically reduced to the maximum non-usurious amount permitted under
applicable law, without the necessity of execution of any amendment or new
document. If any Lender shall ever receive anything of value which is
characterized as interest on the Loans under applicable law and which would,
apart from this provision, be in excess of the maximum lawful amount, an amount
equal to the amount which would have been excessive interest shall, without
penalty, be applied to the reduction of the principal amount owing on the Loans
and not to the payment of interest, or refunded to the Borrower or the other
payor thereof if and to the extent such amount which would have been excessive
exceeds such unpaid principal amount of the Loans. The right to demand payment
of the Loans or any other indebtedness evidenced by any of the Credit Documents
does not include the right to receive any interest which has not otherwise
accrued on the date of such demand, and the Lenders do not intend to charge or
receive any unearned interest in the event of such demand. All interest paid or
agreed to be paid to the Lenders with respect to the Loans shall, to the extent
permitted by applicable law, be amortized, prorated, allocated, and spread
throughout the full stated term (including any renewal or extension) of the
Loans so that the amount of interest on account of such indebtedness does not
exceed the maximum non-usurious amount permitted by applicable law.

 

Page 21

The Administrative Agent will deliver promptly, and in no event later than the
end of the day one Business Day prior to the borrowing date specified in the
Notice of Borrowing, a notice to the Borrower and each Lender setting forth the
Average Asset Swap Spread, the Prices from each Eligible Dealer that were used
in determining the Asset Swap Spreads, the two daily Asset Swap Spreads, the
Spot Mid Swap Rates (if applicable), the Base Rate Applicable Percentage or
Eurodollar Rate Applicable Percentage applicable to the Loan, the Adjusted Base
Rate or Adjusted Eurodollar Rate applicable to the Loan, and the Letter of
Credit Fees (if applicable).

3.8   Sharing of Payments.

Each Lender agrees that, in the event that any Lender shall obtain payment in
respect of any Loan owing to such Lender under this Credit Agreement through the
exercise of a right of set-off, banker's lien, counterclaim or otherwise
(including, but not limited to, pursuant to the Bankruptcy Code) in excess of
its pro rata share as provided for in this Credit Agreement, such Lender shall
promptly purchase from the other Lenders a participation in such Loans, in such
amounts and with such other adjustments from time to time, as shall be equitable
in order that all Lenders share such payment in accordance with their respective
ratable shares as provided for in this Credit Agreement. Each Lender further
agrees that if a payment to a Lender (which is obtained by such Lender through
the exercise of a right of set-off, banker's lien, counterclaim or otherwise)
shall be rescinded or must otherwise be restored, each Lender which shall have
shared the benefit of such payment shall, by repurchase of a participation
theretofore sold, return its share of that benefit to each Lender whose payment
shall have been rescinded or otherwise restored. The Borrower agrees that any
Lender so purchasing such a participation in Loans made to the Borrower may, to
the fullest extent permitted by law, exercise all rights of payment, including
set-off, banker's lien or counterclaim, with respect to such participation as
fully as if such Lender were a holder of such Loan or other obligation in the
amount of such participation. Except as otherwise expressly provided in this
Credit Agreement, if any Lender shall fail to remit to the Administrative Agent
or any other Lender an amount payable by such Lender to the Administrative Agent
or such other Lender pursuant to this Credit Agreement on the date when such
amount is due, such payments shall accrue interest thereon, for each day from
the date such amount is due until the day such amount is paid to the
Administrative Agent or such other Lender, at a rate per annum equal to the
Federal Funds Rate.

 

Page 22

3.9   Evidence of Debt.

Each Lender shall maintain an account or accounts evidencing each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender by or for the account of the Borrower from time
to time under this Credit Agreement. Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update its
account or accounts from time to time, as necessary.

The Administrative Agent shall maintain the Register pursuant to Section
12.3(c), and a subaccount for each Lender, in which Register and subaccounts
(taken together) shall be recorded (i) the amount, type and Interest Period of
each such Loan hereunder, (ii) the amount of any principal or interest due and
payable or to become due and payable to each Lender hereunder and (iii) the
amount of any sum received by the Administrative Agent hereunder from or for the
account of the Borrower and each Lender's share thereof. The Administrative
Agent will make reasonable efforts to maintain the accuracy of the subaccounts
referred to in the preceding sentence and to promptly update such subaccounts
from time to time, as necessary.

The entries made in the accounts, Register and subaccounts maintained pursuant
to subsection (b) of this Section 3.9 (and, if consistent with the entries of
the Administrative Agent, subsection (a)) shall be prima facie evidence of the
existence and amounts of the obligations of the Borrower therein recorded;
provided, however, that the failure of any Lender or the Administrative Agent to
maintain any such account, the Register or such subaccounts, as applicable, or
any error therein, shall not in any manner affect the obligation of the Borrower
to repay the Loans made by such Lender to the Borrower in accordance with the
terms hereof.

SECTION 4 ADDITIONAL PROVISIONS REGARDING LOANS

4.1 Eurodollar Loan Provisions.

Unavailability. In the event that the Administrative Agent shall have determined
in good faith (i) that Dollar deposits in the principal amounts requested with
respect to a Eurodollar Loan are not generally available in the London interbank
Eurodollar market or (ii) that reasonable means do not exist for ascertaining
the Eurodollar Rate, the Administrative Agent shall, as soon as practicable
thereafter, give notice of such determination to the Borrower and the Lenders.
In the event of any such determination under clauses (i) or (ii) above, until
the Administrative Agent shall have advised the Borrower and the Lenders that
the circumstances giving rise to such notice no longer exist, (A) any request by
the Borrower for Eurodollar Loans shall be deemed to be a request for Base Rate
Loans, and (B) any request by the Borrower for conversion into or continuation
of Eurodollar Loans shall be deemed to be a request for conversion into or
continuation of Base Rate Loans.

 

 

Page 23

Change in Legality

.

Notwithstanding any other provision herein, if any change in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then, by
written notice to the Borrower and to the Administrative Agent, such Lender may:

declare that Eurodollar Loans, and conversions to or continuations of Eurodollar
Loans, will not thereafter be made by such Lender to the Borrower hereunder,
whereupon any request by the Borrower for, or for conversion into or
continuation of, Eurodollar Loans shall, as to such Lender only, be deemed a
request for, or for conversion into or continuation of, Base Rate Loans, unless
such declaration shall be subsequently withdrawn; and

require that all outstanding Eurodollar Loans made by it to the Borrower be
converted to Base Rate Loans in which event all such Eurodollar Loans shall be
automatically converted to Base Rate Loans.

In the event any Lender shall exercise its rights under clause (A) or (B) above,
all payments and prepayments of principal which would otherwise have been
applied to repay the Eurodollar Loans that would have been made by such Lender
to the Borrower or the converted Eurodollar Loans of such Lender to the Borrower
shall instead be applied to repay the Base Rate Loans made by such Lender to the
Borrower in lieu of, or resulting from the conversion of, such Eurodollar Loans.

c. Increased Costs. If at any time a Lender shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to the
making, the commitment to make or the maintaining of any Eurodollar Loan because
of (i) any change since the date of this Credit Agreement in any applicable law,
governmental rule, regulation, guideline or order (or in the interpretation or
administration thereof and including the introduction of any new law or
governmental rule, regulation, guideline or such order) including, without
limitation, the imposition, modification or deemed applicability of any
reserves, deposits or similar requirements (such as, for example, but not
limited to, a change in official reserve requirements, but, in all events,
excluding reserves required under Regulation D to the extent included in the
computation of the Adjusted Eurodollar Rate) or (ii) other circumstances
affecting the London interbank Eurodollar market; then the Borrower shall pay to
such Lender promptly upon written demand therefor, such additional amounts (in
the form of an increased rate of, or a different method of calculating, interest
or otherwise as such Lender may determine in its sole discretion) as may be
required to compensate such Lender for such increased costs or reductions in
amounts receivable hereunder.

Page 24

Each determination and calculation made by a Lender under this Section 4.1
shall, absent manifest error, be binding and conclusive on the parties hereto.

4.2    Capital Adequacy.

If, after the date hereof, any Lender has determined that the adoption or
effectiveness of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by such Lender (or its parent corporation) with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's (or parent corporation's) capital
or assets as a consequence of its commitments or obligations hereunder to the
Borrower to a level below that which such Lender (or its parent corporation)
could have achieved but for such adoption, effectiveness, change or compliance
(taking into consideration such Lender's (or parent corporation's) policies with
respect to capital adequacy), then, upon notice from such Lender, the Borrower
shall pay to such Lender such additional amount or amounts as will compensate
such Lender (or its parent corporation) for such reduction. Each determination
by any such Lender of amounts owing under this Section 4.2 shall, absent
manifest error, be conclusive and binding on the parties hereto.

4.3    Compensation.

The Borrower shall compensate each Lender, upon its written request, for all
reasonable losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by the Lender to fund its Eurodollar Loans
to the Borrower) which such Lender may sustain:

if for any reason (other than a default by such Lender or the Administrative
Agent) a borrowing of Eurodollar Loans does not occur on a date specified
therefor in a Notice of Borrowing;

if any repayment, continuation or conversion of any Eurodollar Loan by the
Borrower occurs on a date which is not the last day of an Interest Period
applicable thereto, including, without limitation, in connection with any
demand, acceleration, mandatory prepayment or otherwise (including any demand
under this Section 4); or

if the Borrower fails to repay its Eurodollar Loans when required by the terms
of this Credit Agreement.

Calculation of all amounts payable to a Lender under this Section 4.3 shall be
made as though the Lender has actually funded its Eurodollar Loan through the
purchase of a Eurodollar deposit bearing interest at the Eurodollar Rate in an
amount equal to the amount of that Loan, having a maturity comparable to the
relevant Interest Period and through the transfer of such Eurodollar deposit
from an offshore office of that Lender to a domestic office of that Lender in
the United States of America; provided, however, that each Lender may fund each
of its Eurodollar Loans in any manner it sees fit and the foregoing assumption
shall be utilized only for the calculation of amounts payable under this Section
4.3.

Page 25

4.4    Taxes.

a. Tax Liabilities Imposed on a Lender. Any and all payments by the Borrower
hereunder or under any of the Credit Documents shall be made, in accordance with
the terms hereof and thereof, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding taxes measured
by net income and franchise taxes imposed on any Lender by the jurisdiction
under the laws of which such Lender is organized or transacting business or any
political subdivision thereof (all such non-excluded taxes, 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 to any Lender, (i) 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 4.4) such Lender receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower shall make such
deductions, (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law, and (iv) the
Borrower shall deliver to such Lender evidence of such payment to the relevant
Governmental Authority.

b. Other Taxes. In addition, the Borrower agrees to pay, upon notice from a
Lender and prior to the date when penalties attach thereto, all present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies of the United States or any state or political subdivision
thereof or any applicable foreign jurisdiction that arise from any payment made
hereunder by the Borrower or from the execution, delivery or registration of, or
otherwise from the Borrower's participation with respect to, this Credit
Agreement (collectively, the "Other Taxes").

c. Refunds. If a Lender or the Administrative Agent (as the case may be) shall
become aware that it is entitled to claim a refund (or a refund in the form of a
credit) (each, a "Refund") from a Governmental Authority (as a result of any
error in the amount of Taxes or Other Taxes paid to such Governmental Authority
or otherwise) of Taxes or Other Taxes which the Borrower has paid, or with
respect to which the Borrower has paid additional amounts, pursuant to this
Section 4.4, it shall promptly notify the Borrower of the availability of such
Refund and shall, within 30 days after receipt of written notice by the
Borrower, make a claim to such Governmental Authority for such Refund at the
Borrower's expense if, in the judgment of such Lender or the Administrative
Agent (as the case may be), the making of such claim will not be otherwise
disadvantageous to it; provided that nothing in this subsection (c) shall be
construed to require any Lender or the Administrative Agent to institute any
administrative proceeding (other than the filing of a claim for any such Refund)
or judicial proceeding to obtain such Refund.

 

 

Page 26

If a Lender or the Administrative Agent (as the case may be) receives a Refund
from a Governmental Authority (as a result of any error in the amount of Taxes
or Other Taxes paid to such Governmental Authority or otherwise) of any Taxes or
Other Taxes which have been paid by the Borrower, or with respect to which the
Borrower has paid additional amounts pursuant to this Section 4.4, it shall
promptly pay to the Borrower the amount so received (but only to the extent of
payments made, or additional amounts paid, by the Borrower under this Section
4.4 with respect to Taxes or Other Taxes giving rise to such Refund), net of all
reasonable out-of-pocket expenses (including the net amount of taxes, if any,
imposed on such Lender or the Administrative Agent with respect to such Refund)
of such Lender or Administrative Agent, and without interest (other than
interest paid by the relevant Governmental Authority with respect to such
Refund); provided, however, that the Borrower, upon the request of Lender or the
Administrative Agent, agrees to repay the amount paid over to the Borrower (plus
penalties, interest or other charges) to such Lender or the Administrative Agent
in the event such Lender or the Administrative Agent is required to repay such
Refund to such Governmental Authority. Nothing contained in this Section 4.4(c)
shall require any Lender or the Administrative Agent to make available any of
its tax returns (or any other information that it deems to be confidential or
proprietary).

 

d. Foreign Lender. Each Lender (which, for purposes of this Section 4.4, shall
include any Affiliate of a Lender that makes any Eurodollar Loan pursuant to the
terms of this Credit Agreement) that is not a "United States person" (as such
term is defined in Section 7701(a)(30) of the Code) shall submit to the Borrower
and the Administrative Agent on or before the Closing Date (or, in the case of a
Person that becomes a Lender after the Closing Date by assignment, promptly upon
such assignment), two duly completed and signed copies of (A) either (1) Form
W-8BEN, or any applicable successor form, of the United States Internal Revenue
Service entitling such Lender to a complete exemption from withholding on all
amounts to be received by such Lender pursuant to this Credit Agreement and/or
the Loan Notes or (2) Form W-8ECI, or any applicable successor form, of the
United States Internal Revenue Service relating to all amounts to be received by
such Lender pursuant to this Credit Agreement and/or the Loan Notes and, if
applicable, (B) an Internal Revenue Service Form W-8BEN or W-9 entitling such
Lender to receive a complete exemption from United States backup withholding
tax. Each such Lender shall, from time to time after submitting either such
form, submit to the Borrower and the Administrative Agent such additional duly
completed and signed copies of such forms (or such successor forms or other
documents as shall be adopted from time to time by the relevant United States
taxing authorities) as may be (1) reasonably requested in writing by the
Borrower or the Administrative Agent and (2) appropriate under then current
United States laws or regulations. Upon the reasonable request of the Borrower
or the Administrative Agent, each Lender that has not provided the forms or
other documents, as provided above, on the basis of being a United States person
shall submit to the Borrower and the Administrative Agent a certificate to the
effect that it is such a "United States person."

4.5    Mitigation; Mandatory Assignment.

The Administrative Agent and each Lender shall use reasonable efforts to avoid
or mitigate any increased cost or suspension of the availability of an interest
rate under Sections 4.1 through 4.4 above to the greatest extent practicable
(including transferring the Loans to another lending office or Affiliate of a
Lender) unless, in the opinion of the Administrative Agent or such Lender, such
efforts would be likely to have an adverse effect upon it. In the event a Lender
makes a request to the Borrower for additional payments in accordance with
Section 4.1, 4.2 or 4.4, then, provided that no Default or Event of Default has
occurred and is continuing at such time, the Borrower may, at its own expense
(such expense to include any transfer fee payable to the Administrative Agent
under Section 12.3(b) and any expense pursuant to Section 4 hereof) and in its
sole discretion, require such Lender to transfer and assign in whole (but not in
part), without recourse (in accordance with and subject to the terms and
conditions of Section 12.3(b)), all of its interests, rights and obligations
under this Credit Agreement to an Eligible Assignee which shall assume such
assigned obligations (which Eligible Assignee may be another Lender, if a Lender
accepts such assignment); provided that (a) such assignment shall not conflict
with any law, rule or regulation or order of any court or other Governmental
Authority and (b) the Borrower or such Eligible Assignee shall have paid to the
assigning Lender in immediately available funds the principal of and interest
accrued to the date of such payment on the portion of the Loans hereunder held
by such assigning Lender and all other amounts owed to such assigning Lender
hereunder, including amounts owed pursuant to Sections 4.1 through 4.4 hereof.

Page 27

SECTION 5 LETTERS OF CREDIT

5.1       L/C Commitment.

a. Subject to the terms and conditions hereof, each Issuing Lender, in reliance
on the agreements of the other Lenders set forth in Section 5.4, agrees to issue
letters of credit (each a "Letter of Credit") for the account of the Borrower on
any Business Day from the Closing Date until the date that is ten Business Days
prior to the Maturity Date in such form as may be approved from time to time by
such Issuing Lender; provided that no Issuing Lender shall have any obligation
to issue any Letter of Credit if, after giving effect to such issuance, (i) the
L/C Obligations would exceed the L/C Commitment, (ii) the aggregate amount of
the Utilized Commitments would be greater than the Loan Commitments or (iii)
unless the applicable Issuing Lender shall otherwise consent thereto, the
aggregate amount of all outstanding Letters of Credit issued by such Issuing
Lender would exceed 33⅓% of the L/C Commitment. Each Letter of Credit shall (x)
be denominated in Dollars, (y) have a face amount of at least $1,000,000 (unless
otherwise agreed by the Issuing Lender) and (z) expire no later than the first
anniversary of its date of issuance; provided, that, if one or more Letters of
Credit shall at any time have an expiry date that is later than the Maturity
Date, the Borrower shall, not later than (i) five days preceding the Maturity
Date, deposit in a cash collateral account opened by the Administrative Agent an
amount equal to the aggregate then undrawn and unexpired amount of such Letters
of Credit, if the Borrower's senior unsecured long-term, non-credit enhanced
debt rating in effect is at least BBB- as published by S&P and is at least Baa3
as published by Moody's or (ii) fifteen days preceding the Maturity Date,
deposit in a cash collateral account opened by the Administrative Agent an
amount equal to the aggregate then undrawn and unexpired amount of such Letters
of Credit if the Borrower's senior unsecured long-term, non-credit enhanced debt
rating in effect is lower than BBB- as published by S&P or is lower than Baa3 as
published by Moody's. Amounts held in such cash collateral account shall be held
and applied by the Administrative Agent in the manner and for the purposes set
forth in Section 10.2(c).

 

 

Page 28

b. No Issuing Lender shall at any time be obligated to issue any Letter of
Credit if such issuance would conflict with, or cause such Issuing Lender or any
L/C Participant to exceed any limits imposed by, any applicable requirement of
law.

c. Schedule 5.1 contains a description of all letters of credit issued by the
Issuing Lenders pursuant to the Existing Credit Agreement and which are to
remain outstanding on the Effective Date. Each such letter of credit, including
any extension thereof, shall constitute a "Letter of Credit" for all purposes of
this Credit Agreement.

5.2      Procedure for Issuance of Letter of Credit.

The Borrower may from time to time request that an Issuing Lender issue a Letter
of Credit by delivering an Application therefor to such Issuing Lender, with a
copy to the Administrative Agent, at their respective addresses for notices
specified herein, completed to the satisfaction of such Issuing Lender, and such
other certificates, documents and other papers and information as such Issuing
Lender may request. Upon receipt of any Application, the Issuing Lender will
process such Application and the certificates, documents and other papers and
information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Lender shall promptly furnish to the Administrative Agent notice of the
issuance of such Letter of Credit (including the amount thereof), together with
a copy of such Letter of Credit, whereupon the Administrative Agent shall in
turn promptly furnish such notice to the Lenders and a copy of such Letter of
Credit to any Lender requesting the same.

5.3    Fees and Other Charges.

The Borrower will pay a fee ("Letter of Credit Fees") on all outstanding Letters
of Credit at a per annum rate equal to the L/C Applicable Percentage multiplied
by the Stated Amount of each Letter of Credit, shared ratably among the Lenders
and payable quarterly in arrears on each L/C Fee Payment Date after the issuance
date. In addition, the Borrower shall pay to each Issuing Lender for its own
account a fronting fee on the undrawn and unexpired amount of each Letter of
Credit issued by it as agreed between the Borrower and such Issuing Lender.

In addition to the foregoing fees, the Borrower shall pay or reimburse the
Issuing Lender for such normal and customary costs and expenses as are incurred
or charged by such Issuing Lender in issuing, negotiating, effecting payment
under, amending or otherwise administering any Letter of Credit issued by it.

5.4    L/C Participations.

Each Issuing Lender irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce the Issuing Lenders to issue their respective
Letters of Credit, each L/C Participant irrevocably agrees to accept and
purchase and hereby accepts and purchases from each Issuing Lender, on the terms
and conditions set forth below, for such L/C Participant's own account and risk
an undivided interest equal to such L/C Participant's Commitment Percentage in
such Issuing Lender's obligations and rights under and in respect of each Letter
of Credit issued by it and the amount of each draft paid by such Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees that, if
a draft is paid under any Letter of Credit for which the Issuing Lender is not
indefeasible reimbursed in cash in full by the Borrower in accordance with the
terms of this Agreement (notwithstanding delivery of cash collateral pursuant to
Sections 5.1(a) and 10.2(c)), such L/C Participant shall pay to the
Administrative Agent for the account of the Issuing Lender, upon demand, an
amount equal to such L/C Participant's Commitment Percentage of the amount of
such draft, or any part thereof, that is not so reimbursed.

 

Page 29

If any amount required to be paid by any L/C Participant to or for the account
of an Issuing Lender pursuant to Section 5.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
paid within three Business Days after the date such payment is due, such L/C
Participant shall pay to the Administrative Agent for the account of the Issuing
Lender on demand an amount equal to the product of (i) such amount, times (ii)
the daily average Federal Funds Rate during the period from and including the
date such payment is required to the date on which such payment is immediately
available to the Issuing Lender, times (iii) a fraction the numerator of which
is the number of days that elapse during such period and the denominator of
which is 360. If any such amount required to be paid by any L/C Participant
pursuant to Section 5.4(a) is not made available by such L/C Participant within
three Business Days after the date such payment is due, the Issuing Lender shall
be entitled to recover from such L/C Participant, on demand, such amount with
interest thereon calculated from such due date at the Adjusted Base Rate. A
certificate of an Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this Section shall be conclusive in the absence of
manifest error.

Whenever, at any time after an Issuing Lender has made payment under any Letter
of Credit and has received from any L/C Participant its pro rata share of such
payment in accordance with Section 5.4(a), the Issuing Lender receives any
payment related to such Letter of Credit (whether directly from the Borrower or
otherwise, including proceeds of collateral applied thereto by the Issuing
Lender), or any payment of interest on account thereof, the Issuing Lender will
cause the Administrative Agent to distribute to such L/C Participant its pro
rata share thereof; provided, however, that in the event that any such payment
received by the Issuing Lender shall be required to be returned by the Issuing
Lender, such L/C Participant shall return to the Issuing Lender the portion
thereof previously distributed by the Issuing Lender to it.

5.5    Reimbursement Obligation of the Borrower.

The Borrower agrees to reimburse each Issuing Lender on the Business Day on
which such Issuing Lender notifies the Borrower of the date and amount of a
draft presented under any Letter of Credit and paid by such Issuing Lender for
the amount of (a) such draft so paid and (b) any taxes, fees, charges or other
costs or expenses incurred by such Issuing Lender in connection with such
payment. Each such payment shall be made to the Issuing Lender at its address
for notices referred to herein in Dollars and in immediately available funds.
Interest shall be payable on any such amounts from the date on which the
relevant draft is paid until payment in full at the rate set forth in (i) until
the Business Day next succeeding the date of the relevant notice, Section
3.1(a)(i) and (ii) thereafter, Section 3.1(b).

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5.6    Obligations Absolute.

The Borrower's obligations under this Section 5 shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment that the Borrower may have or have had
against any Issuing Lender, any beneficiary of a Letter of Credit or any other
Person. The Borrower also agrees with each Issuing Lender that such Issuing
Lender shall not be responsible for, and the Borrower's Reimbursement
Obligations under Section 5.5 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though
such documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among the Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower against any beneficiary of such Letter of
Credit or any such transferee. No Issuing Lender shall be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit,
except for errors or omissions found by a final and nonappealable decision of a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of such Issuing Lender. The Borrower agrees that any action
taken or omitted by an Issuing Lender under or in connection with any Letter of
Credit or the related drafts or documents, if done in the absence of gross
negligence or willful misconduct and in accordance with the standards of care
specified in the Uniform Commercial Code of the State of New York, shall be
binding on the Borrower and shall not result in any liability of such Issuing
Lender to the Borrower.

5.7    Letter of Credit Payments.

If any draft shall be presented for payment under any Letter of Credit, the
Issuing Lender shall promptly notify the Administrative Agent and the Borrower
of the date and amount thereof. The responsibility of the Issuing Lender to the
Borrower in connection with any draft presented for payment under any Letter of
Credit shall, in addition to any payment obligation expressly provided for in
such Letter of Credit, be limited to determining that the documents (including
each draft) delivered under such Letter of Credit in connection with such
presentment are substantially in conformity with such Letter of Credit, subject
to Section 5.6.

5.8    Applications.

To the extent that any provision of any Application related to any Letter of
Credit is inconsistent with the provisions of this Section 5, the provisions of
this Section 5 shall apply.

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SECTION 6 CONDITIONS PRECEDENT

6.1       Closing Conditions.

The obligation of the Lenders to enter into the Credit Documents is subject to
satisfaction of the following conditions (in form and substance acceptable to
the Lenders) on or prior to August 10, 2004.

Credit Documents

. Receipt by the Administrative Agent of duly executed copies of: (i) this
Credit Agreement and (ii) the other Credit Documents.

Corporate Documents

. Receipt by the Administrative Agent of the following:

i. Charter Documents. Copies of the articles of incorporation or other charter
documents of the Borrower certified to be true and complete as of a recent date
by the appropriate Governmental Authority of the state or other jurisdiction of
its incorporation and certified by a secretary or assistant secretary of the
Borrower to be true and correct as of the Closing Date.

ii. Bylaws. A copy of the bylaws of the Borrower certified by a secretary or
assistant secretary of the Borrower to be true and correct as of the Closing
Date.

iii. Resolutions. Copies of resolutions of the Board of Directors of the
Borrower approving and adopting the Credit Documents, the transactions
contemplated herein and therein and authorizing execution and delivery thereof,
certified by a secretary or assistant secretary of the Borrower to be true and
correct and in force and effect as of the Closing Date.

iv. Good Standing. Copies of (a) certificates of good standing, existence or its
equivalent, certified as of a recent date by the appropriate Governmental
Authorities of its jurisdiction of incorporation and each other jurisdiction in
which the failure to so qualify and be in good standing would have a Material
Adverse Effect and (b) to the extent available, a certificate indicating payment
of all corporate franchise taxes certified as of a recent date by the
appropriate Governmental Authorities of the Borrower's jurisdiction of
incorporation and each other jurisdiction from which the failure to pay such
franchise taxes would have a Material Adverse Effect.

Closing Certificate

. Receipt by the Administrative Agent of a certificate of the Borrower, dated
the Closing Date, substantially in the form of Exhibit 6.1(c), executed by any
Assistant Treasurer and the Secretary or any Assistant Secretary of the
Borrower, and attaching the documents referred to in subsections 6.1(b).

Outstanding Facility

. Receipt by the Administrative Agent of evidence satisfactory to it that all
indebtedness outstanding under the Existing Credit Agreement, all interest
thereon and all other amounts due and owing or to become due and owing
thereunder have been paid in full and all commitments thereunder terminated;
provided that all "Letters of Credit" outstanding thereunder, all of which are
listed on Schedule 5.1, shall be deemed to be Letters of Credit hereunder.

  

 

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Fees

. The Lenders and the Administrative Agent shall have received all fees required
to be paid, and all expenses for which invoices have been presented.

Opinion of Counsel

. Receipt by the Administrative Agent of an opinion or opinions, satisfactory in
form and content to the Administrative Agent and the Lenders, addressed to the
Administrative Agent and each of the Lenders and dated as of the Closing Date,
substantially in the form of Exhibit 6.1(f), from McGuireWoods LLP, outside
legal counsel to the Borrower.

Financial Statements

. Receipt and approval by the Administrative Agent and the Lenders of the
audited consolidated financial statements of the Borrower dated as of December
31, 2002 and December 31, 2003 and the unaudited interim consolidated financial
statements of the Borrower for the periods ended March 31, 2004 and June 30,
2004.

Consents

. Receipt by the Administrative Agent of a written representation from the
Borrower that (i) all governmental, shareholder and third party consents
(including Securities and Exchange Commission clearance) and approvals necessary
or, in the reasonable opinion of the Administrative Agent, advisable in
connection with the transactions contemplated hereby have been received and are
in full force and effect and (ii) no condition or requirement of law exists
which could reasonably be likely to restrain, prevent or impose any material
adverse condition on the transactions contemplated hereby, and receipt by the
Administrative Agent of copies of any required orders of any regulatory
authority approving the Borrower's execution, delivery and performance of this
Credit Agreement and the borrowings hereunder.

No Default; Representations and Warranties

. As of the Closing Date (i) there shall exist no Default or Event of Default
and (ii) all representations and warranties contained herein and in the other
Credit Documents shall be true and correct in all material respects.

Material Adverse Effect

. No event or condition shall have occurred since the dates of the financial
statements delivered pursuant to Section 6.1(g) above that has or would be
likely to have a Material Adverse Effect.

Other

. Receipt by the Lenders of such other documents, instruments, agreements or
information as reasonably requested by any Lender.

The Administrative Agent shall provide written notice to the Borrower and the
Lenders upon the occurrence of the Effective Date (as defined in Section 12.15).

6.2    Conditions to Loans.

In addition to the conditions precedent stated elsewhere herein, the Lenders
shall not be obligated to make new Loans to the Borrower (including the initial
Loans to be made hereunder) or issue, renew or participate in any Letter of
Credit unless:

Page 33

Request

. The Borrower shall have timely delivered a duly executed and completed Notice
of Borrowing or Application in conformance with all the terms and conditions of
this Credit Agreement.

Representations and Warranties

. The representations and warranties made by the Borrower in or pursuant to the
Credit Documents are true and correct in all material respects at and as if made
as of the date of the funding of the Loans or issuance of any Letter of Credit;
provided
,
however
, that the representation and warranty set forth in clause (ii) of the second
paragraph of Section 7.6 hereof need not be true and correct as a condition to
any borrowing utilized by the Borrower in connection with the repayment of its
commercial paper program.

No Default

. On the date of the funding of the Loans or issuance of the Letter of Credit,
no Default or Event of Default has occurred and is continuing or would be caused
by making the Loans or issuance of a Letter of Credit.

Availability

. Immediately after giving effect to the making of a Loan (and the application
of the proceeds thereof) or issuance of the Letter of Credit, the sum of Loans
outstanding and the L/C Obligations shall not exceed the Loan Commitment.

The delivery of each Notice of Borrowing and Application shall constitute a
representation and warranty by the Borrower of the correctness of the matters
specified in subsections (b), (c), and (d) above.

SECTION 7 REPRESENTATIONS AND WARRANTIES

The Borrower hereby represents and warrants to each Lender that:

7.1    Organization and Good Standing.

The Borrower and each Material Subsidiary of the Borrower (other than any
Material Subsidiary that is not a corporation) (a) is a corporation duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, (b) is duly qualified and in good standing as
a foreign corporation authorized to do business in every jurisdiction where the
failure to so qualify would have a Material Adverse Effect and (c) has the
requisite corporate power and authority to own its properties and to carry on
its business as now conducted and as proposed to be conducted. Each Material
Subsidiary of the Borrower that is not a corporation (a) is a legal entity duly
organized, existing and in good standing under the laws of its jurisdiction of
organization, (b) is registered or qualified as an entity authorized to do
business in every jurisdiction where the failure to be so registered or
qualified would have a Material Adverse Effect and (c) has the requisite power
and authority to own its properties and to carry on its business as now
conducted and as proposed to be conducted.

7.2    Due Authorization.

The Borrower (a) has the requisite corporate power and authority to execute,
deliver and perform this Credit Agreement and the other Credit Documents and to
incur the obligations herein and therein provided for and (b) is duly authorized
to, and has been authorized by all necessary corporate action, to execute,
deliver and perform this Credit Agreement and the other Credit Documents.

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7.3    No Conflicts.

Neither the execution and delivery of the Credit Documents nor the consummation
of the transactions contemplated therein, nor performance of and compliance with
the terms and provisions thereof by the Borrower will (a) violate or conflict
with any provision of its articles of incorporation or bylaws, (b) violate,
contravene or materially conflict with any law (including without limitation,
the 1935 Act), regulation (including, without limitation, Regulation U or
Regulation X), order, writ, judgment, injunction, decree or permit applicable to
it, (c) violate, contravene or materially conflict with contractual provisions
of, or cause an event of default under, any indenture, loan agreement, mortgage,
deed of trust, contract or other agreement or instrument to which it is a party
or by which it may be bound, the violation of which could have a Material
Adverse Effect or (d) result in or require the creation of any Lien upon or with
respect to its properties.

7.4    Consents.

No consent, approval, authorization or order of, or filing, registration or
qualification with, any court or Governmental Authority or third party is
required to be obtained or made by the Borrower in connection with the
Borrower's execution, delivery or performance of this Credit Agreement or any of
the other Credit Documents that has not been obtained or made.

7.5    Enforceable Obligations.

This Credit Agreement and the other Credit Documents have been duly executed and
delivered and constitute legal, valid and binding obligations of the Borrower
enforceable against the Borrower in accordance with their respective terms,
except as may be limited by bankruptcy or insolvency laws or similar laws
affecting creditors' rights generally or by general equitable principles.

7.6    Financial Condition.

The financial statements provided to the Lenders pursuant to Section 6.1(g) and
pursuant to Section 8.1(a) and (b) present fairly the financial condition,
results of operations and cash flows of the Borrower and its Consolidated
Subsidiaries as of the date stated therein.

In addition, (i) such financial statements were prepared in accordance with GAAP
and, (ii) since June 30, 2004, there have occurred no changes or circumstances
which have had or would be reasonably expected to have a Material Adverse
Effect.

7.7    No Default.

Neither the Borrower nor any of its Material Subsidiaries is in default in any
respect under any contract, lease, loan agreement, indenture, mortgage, security
agreement or other agreement or obligation to which it is a party or by which
any of its properties is bound which default would have or would be reasonably
expected to have a Material Adverse Effect.

Page 35

7.8    Indebtedness.

As of the Closing Date, the Borrower has no Indebtedness except as disclosed in
the financial statements referenced in Section 6.1(g) and on Schedule 7.8.

7.9    Litigation.

Except as disclosed in the Borrower's Annual Report on Form 10-K for the year
ended December 31, 2003 and the Borrower's Quarterly Report on Form 10-Q for the
quarter ended June 30, 2004, there are no actions, suits or legal, equitable,
arbitration or administrative proceedings, pending or, to the knowledge of the
Borrower, threatened against the Borrower or a Material Subsidiary of the
Borrower in which there is a reasonable possibility of an adverse decision which
would have or would reasonably be expected to have a Material Adverse Effect.

7.10  Taxes.

The Borrower and each Material Subsidiary of the Borrower has filed, or caused
to be filed, all material tax returns (federal, state, local and foreign)
required to be filed by it and paid all amounts of taxes shown thereon to be due
(including interest and penalties) and has paid all other taxes, fees,
assessments and other governmental charges (including mortgage recording taxes,
documentary stamp taxes and intangibles taxes) owing by it, except for such
taxes which are not yet delinquent or that are being contested in good faith and
by proper proceedings, and against which adequate reserves are being maintained
in accordance with GAAP. The Borrower is not aware of any proposed tax
assessments against it or any of its Material Subsidiaries.

7.11  Compliance with Law.

Except as disclosed in the Borrower's Annual Report on Form 10-K for the year
ended December 31, 2003 and the Borrower's Quarterly Report for the quarter
ended June 30, 2004, the Borrower and each Material Subsidiary of the Borrower
is in compliance with all laws, rules, regulations, orders and decrees
applicable to it, or to its properties, unless such failure to comply would not
have a Material Adverse Effect.

7.12  ERISA.

(a) No Reportable Event has occurred and is continuing with respect to any Plan;
(b) no Plan has an accumulated funding deficiency determined under Section 412
of the Code; (c) no proceedings have been instituted, or, to the knowledge of
the Borrower, planned to terminate any Plan; (d) neither the Borrower, nor any
member of a Controlled Group including the Borrower, nor any duly-appointed
administrator of a Plan has instituted or intends to institute proceedings to
withdraw from any Multiemployer Pension Plan (as defined in Section 3(37) of
ERISA); and (e) each Plan has been maintained and funded in all material
respects in accordance with its terms and with the provisions of ERISA
applicable thereto.

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7.13  Use of Proceeds.

The Borrower intends that the facilities afforded by this Agreement will be used
primarily in the form of Letters of Credit and, secondarily, in the form of
Loans. The proceeds of the Loans made to the Borrower will be used solely (a) to
provide credit support for the Borrower's commercial paper, (b) for working
capital of the Borrower and its Subsidiaries and (c) for other general corporate
purposes.

7.14  Government Regulation.

None of the proceeds of the Loans made to the Borrower hereunder will be used
for the purpose of purchasing or carrying any "margin stock" which violates
Regulation U or Regulation X or for the purpose of reducing or retiring in
violation of Regulation U or Regulation X any Indebtedness which was originally
incurred to purchase or carry "margin stock" or for any other purpose which
might constitute this transaction a "purpose credit" in violation of Regulation
U or Regulation X.

As of the Closing Date, each of the Borrower and Dominion Resources is a
registered "holding company" within the meaning of that term under the 1935 Act.
The issuance by the Borrower of the Loan Notes, its incurrence of the
Indebtedness contemplated by this Credit Agreement and the borrowing, repayment
and reborrowing of Loans and issuance and reimbursement of Letters of Credit
hereunder are permitted by the 1935 Act and require no authorization or approval
of any Governmental Authority other than such authorizations and approvals as
have already been duly obtained and are in full force and effect.

The Borrower is not an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, and is not
controlled by such a company, nor is otherwise subject to regulation under said
Act.

7.15  Solvency.

The Borrower is and, after the consummation of the transactions contemplated by
this Credit Agreement and the other Credit Documents, will be Solvent.

SECTION 8 AFFIRMATIVE COVENANTS

The Borrower hereby covenants and agrees that so long as this Credit Agreement
is in effect and until the Loans made to it, together with interest, fees and
all other obligations hereunder, have been paid in full and the Commitments and
all Letters of Credit hereunder shall have terminated:

8.1  Information Covenants.

The Borrower will furnish, or cause to be furnished, to the Administrative Agent
and each Lender:

Annual Financial Statements

. As soon as available, and in any event within 120 days after the close of each
fiscal year of the Borrower, a Form 10-K, as required to be filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
and the Exchange Act, which includes financial information required by such Form
10-K, such financial information to be in reasonable form and detail and audited
by Deloitte & Touche LLP or another independent certified public accountants of
recognized national standing reasonably acceptable to the Administrative Agent
and whose opinion shall be to the effect that such financial statements have
been prepared in accordance with GAAP (except for changes with which such
accountants concur) and shall not be limited as to the scope of the audit or
qualified in any respect.

 

Page 37

Quarterly Financial Statements

. As soon as available, and in any event within 60 days after the close of each
of the first three fiscal quarters of the Borrower, a Form 10-Q, as required to
be filed with the Securities and Exchange Commission under the Securities Act of
1933, as amended, and the Exchange Act, which includes the financial information
required by such Form 10-Q, such financial information to be in reasonable form
and detail and reasonably acceptable to the Administrative Agent, and
accompanied by a certificate of the chief financial officer or treasurer of the
Borrower to the effect that such quarterly financial statements fairly present
in all material respects the financial condition of the Borrower and have been
prepared in accordance with GAAP, subject to changes resulting from audit and
normal year-end audit adjustments.

Officer's Certificate

. At the time of delivery of the financial statements provided for in Sections
8.1(a) and 8.1(b) above, a certificate of the chief financial officer or
treasurer of the Borrower, substantially in the form of Exhibit 8.1(c), (i)
demonstrating compliance with the financial covenant contained in Section 8.10
by calculation thereof as of the end of each such fiscal period and (ii) stating
that no Default or Event of Default exists, or if any such Default or Event of
Default does exist, specifying the nature and extent thereof and what action the
Borrower proposes to take with respect thereto.

Reports

. Promptly upon transmission or receipt thereof, notice of any filings and
registrations of the Borrower with, and reports to or from, the Securities and
Exchange Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as Dominion Resources shall
send to its shareholders.

Notices

. Upon the Borrower obtaining knowledge thereof, the Borrower will give written
notice to the Administrative Agent immediately of (i) the occurrence of an event
or condition consisting of a Default or Event of Default, specifying the nature
and existence thereof and what action the Borrower proposes to take with respect
thereto, and (ii) the occurrence of any of the following: (A) the pendency or
commencement of any litigation, arbitral or governmental proceeding against the
Borrower or a Material Subsidiary of the Borrower which, if adversely
determined, is likely to have a Material Adverse Effect, (B) the institution of
any proceedings against the Borrower or a Material Subsidiary of the Borrower
with respect to, or the receipt of notice by such Person of potential liability
or responsibility for violation, or alleged violation of any federal, state or
local law, rule or regulation, the violation of which would likely have a
Material Adverse Effect or (C) any notice or determination concerning the
imposition of any withdrawal liability by a Multiemployer Plan against the
Borrower or any of its ERISA Affiliates, the determination that a Multiemployer
Plan is, or is expected to be, in reorganization within the meaning of Title IV
of ERISA or the termination of any Plan.

 

Page 38

Other Information

. With reasonable promptness upon any such request, such other information
regarding the business, properties or financial condition of the Borrower as the
Administrative Agent or the Required Lenders may reasonably request.

8.2  Preservation of Existence and Franchises.

The Borrower will do (and will cause each of its Material Subsidiaries to do)
all things necessary to preserve and keep in full force and effect its
existence, rights, franchises and authority; provided that nothing in this
Section 8.2 shall prevent any transaction otherwise permitted under Section 9.2
or Section 9.3 or any change in the form of organization (by merger or
otherwise) of any Material Subsidiary of the Borrower so long as such change
shall not have an adverse effect on the Borrower's ability to perform its
obligations hereunder.

8.3  Books and Records.

The Borrower will keep (and will cause each of its Material Subsidiaries to
keep) complete and accurate books and records of its transactions in accordance
with good accounting practices on the basis of GAAP (including the establishment
and maintenance of appropriate reserves).

8.4  Compliance with Law.

The Borrower will comply (and will cause each of its Material Subsidiaries to
comply) with all laws, rules, regulations and orders, and all applicable
restrictions imposed by all Governmental Authorities, applicable to it and its
property if noncompliance with any such law, rule, regulation, order or
restriction would be reasonably expected to have a Material Adverse Effect.

8.5  Payment of Taxes.

The Borrower will pay and discharge all taxes, assessments and governmental
charges or levies imposed upon it, or upon its income or profits, or upon any of
its properties, before they shall become delinquent; provided, however, that the
Borrower shall not be required to pay any such tax, assessment, charge, levy, or
claim which is being contested in good faith by appropriate proceedings and as
to which adequate reserves therefor have been established in accordance with
GAAP.

8.6  Insurance.

The Borrower will at all times maintain in full force and effect insurance
(including worker's compensation insurance, liability insurance, casualty
insurance and business interruption insurance) in such amounts, covering such
risks and liabilities and with such deductibles or self-insurance retentions as
are in accordance with normal industry practice.

Page 39

8.7  Performance of Obligations.

The Borrower will perform (and will cause each of its Material Subsidiaries to
perform) in all material respects all of its obligations under the terms of all
material agreements, indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.

8.8  ERISA.

The Borrower and each of its ERISA Affiliates will (a) at all times make prompt
payment of all contributions (i) required under all employee pension benefit
plans (as defined in Section 3(2) of ERISA) ("Pension Plans") and (ii) required
to meet the minimum funding standard set forth in ERISA with respect to each of
its Plans; (b) promptly upon request, furnish the Administrative Agent and the
Lenders copies of each annual report/return (Form 5500 Series), as well as all
schedules and attachments required to be filed with the Department of Labor
and/or the Internal Revenue Service pursuant to ERISA, and the regulations
promulgated thereunder, in connection with each of its Pension Plans for each
Plan Year (as defined in ERISA); (c) notify the Administrative Agent immediately
of any fact, including, but not limited to, any Reportable Event arising in
connection with any of its Plans, which might constitute grounds for termination
thereof by the PBGC or for the appointment by the appropriate United States
District Court of a trustee to administer such Plan, together with a statement,
if requested by the Administrative Agent, as to the reason therefor and the
action, if any, proposed to be taken in respect thereof; and (d) furnish to the
Administrative Agent, upon its request, such additional information concerning
any of its Plans as may be reasonably requested. The Borrower will not nor will
it permit any of its ERISA Affiliates to (A) terminate a Plan if any such
termination would have a Material Adverse Effect or (B) cause or permit to exist
any Reportable Event under ERISA or other event or condition which presents a
material risk of termination at the request of the PBGC if such termination
would have a Material Adverse Effect.

8.9  Audits/Inspections.

Upon reasonable notice, during normal business hours and in compliance with the
reasonable security procedures of the Borrower, the Borrower will permit
representatives appointed by the Administrative Agent or any Lender, including,
without limitation, independent accountants, agents, attorneys, and appraisers
to visit and inspect the Borrower's property, including its books and records,
its accounts receivable and inventory, the Borrower's facilities and its other
business assets, and to make photocopies or photographs thereof and to write
down and record any information such representative obtains and shall permit any
Lender or the Administrative Agent or its representatives to investigate and
verify the accuracy of information provided to the Lenders and to discuss all
such matters with the officers, employees and representatives of the Borrower.

8.10  Total Funded Debt to Capitalization.

The ratio of (a) Total Funded Debt to (b) Capitalization for the Borrower shall
at all times be less than or equal to .60 to 1.00.

Page 40

SECTION 9 NEGATIVE COVENANTS

The Borrower hereby covenants and agrees that so long as this Credit Agreement
is in effect and until the Loans, together with interest, fees and all other
obligations hereunder, have been paid in full and the Commitments and all
Letters of Credit hereunder shall have terminated:

9.1    Nature of Business.

The Borrower will not alter the character of its business from that conducted as
of the Closing Date and activities reasonably related thereto and similar and
related businesses.

9.2    Consolidation and Merger.

The Borrower will not enter into any transaction of merger or consolidation or
liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution); provided that notwithstanding the foregoing provisions of this
Section 9.2, the following actions may be taken if, both immediately prior
thereto and after giving effect thereto, no Default or Event of Default exists:

a Subsidiary of the Borrower may be merged or consolidated with or into the
Borrower; provided that the Borrower shall be the continuing or surviving
entity; and

the Borrower may merge or consolidate with any other Person if either (i) the
Borrower shall be the continuing or surviving entity or (ii) the Borrower shall
not be the continuing or surviving entity and the entity so continuing or
surviving (A) is an entity organized and duly existing under the law of any
state of the United States and (B) executes and delivers to the Administrative
Agent and the Lenders an instrument in form satisfactory to the Required Lenders
pursuant to which it expressly assumes the Loans and all of the other
obligations of the Borrower under the Credit Documents and procures for the
Administrative Agent and each Lender an opinion in form satisfactory to the
Required Lenders and from counsel satisfactory to the Required Lenders in
respect of the due authorization, execution, delivery and enforceability of such
instrument and covering such other matters as the Required Lenders may
reasonably request.

9.3    Sale or Lease of Assets.

The Borrower will not convey, sell, lease, transfer or otherwise dispose of, in
one transaction or a series of transactions, all or substantially all of its
business or assets whether now owned or hereafter acquired.

9.4    Limitation on Liens.

If the Borrower shall pledge, mortgage or hypothecate, or permit any Lien upon,
any property or assets at any time owned by the Borrower and by reason thereof
the Borrower would under the Indenture be obligated to cause the securities
outstanding under the Indenture as from time to time in effect to be secured by
such pledge, mortgage, hypothecation or other Lien, the Borrower shall
concurrently make effective provision whereby the Loans and Reimbursement
Obligations outstanding hereunder will be equally and ratably secured with any
and all other indebtedness thereby secured.

Page 41

9.5    Fiscal Year.

The Borrower will not change its fiscal year without prior notification to the
Lenders.

SECTION 10 EVENTS OF DEFAULT

10.1      Events of Default.

An Event of Default shall exist upon the occurrence and continuation of any of
the following specified events (each an "Event of Default"):

Payment

. The Borrower shall:

i. default in the payment when due of any principal of any of the Loans or
Reimbursement Obligations, or shall fail to deliver to the Administrative Agent,
when due, any cash collateral required to be provided in accordance with Section
5.1(a); or

ii. default, and such default shall continue for three or more days, in the
payment when due of any interest on the Loans, Reimbursement Obligations or of
any fees or other amounts owing hereunder, under any of the other Credit
Documents or in connection herewith.

Representations

. Any representation, warranty or statement made or deemed to be made by the
Borrower herein, in any of the other Credit Documents, or in any statement or
certificate delivered or required to be delivered pursuant hereto or thereto
shall prove untrue in any material respect on the date as of which it was deemed
to have been made.

Covenants

. The Borrower shall:

i. default in the due performance or observance of any term, covenant or
agreement contained in Sections 8.2, 8.10 or 9.1 through 9.5, inclusive; or

ii. default in the due performance or observance by it of any term, covenant or
agreement contained in Section 8.1(a), (b), (c) or (e) and such default shall
continue unremedied for a period of five Business Days after the earlier of an
officer of the Borrower becoming aware of such default or notice thereof given
by the Administrative Agent; or

iii. default in the due performance or observance by it of any term, covenant or
agreement (other than those referred to in subsections (a), (b), (c)(i), or
(c)(ii) of this Section 10.1) contained in this Credit Agreement or any other
Credit Document and such default shall continue unremedied for a period of at
least 30 days after the earlier of an officer of the Borrower becoming aware of
such default or notice thereof given by the Administrative Agent.

 

Page 42

Credit Documents

. Any Credit Document shall fail to be in full force and effect or shall fail to
give the Administrative Agent and/or the Lenders the security interests, liens,
rights, powers and privileges purported to be created thereby.

Bankruptcy, etc

. The occurrence of any of the following: (i) a court or governmental agency
having jurisdiction in the premises shall enter a decree or order for relief in
respect of the Borrower or a Material Subsidiary of the Borrower in an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or appoint a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Borrower or a
Material Subsidiary of the Borrower or for any substantial part of its property
or ordering the winding up or liquidation of its affairs; or (ii) an involuntary
case under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect is commenced against the Borrower or a Material Subsidiary
of the Borrower and such petition remains unstayed and in effect for a period of
60 consecutive days; or (iii) the Borrower or a Material Subsidiary of the
Borrower shall commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or consent to the
entry of an order for relief in an involuntary case under any such law, or
consent to the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of such Person or
any substantial part of its property or make any general assignment for the
benefit of creditors; or (iv) the Borrower or a Material Subsidiary of the
Borrower shall admit in writing its inability to pay its debts generally as they
become due or any action shall be taken by such Person in furtherance of any of
the aforesaid purposes.

Defaults under Other Agreements

. With respect to any Indebtedness (other than Indebtedness outstanding under
this Credit Agreement) of the Borrower or a Material Subsidiary of the Borrower
in a principal amount in excess of $25,000,000, (i) the Borrower or a Material
Subsidiary of the Borrower shall (A) default in any payment (beyond the
applicable grace period with respect thereto, if any) with respect to any such
Indebtedness, or (B) default (after giving effect to any applicable grace
period) in the observance or performance of any covenant or agreement relating
to such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event or condition shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or permit, the holder or holders of such Indebtedness (or trustee or
agent on behalf of such holders) to cause any such Indebtedness to become due
prior to its stated maturity; or (ii) any such Indebtedness shall be declared
due and payable, or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof; or (iii) any such
Indebtedness matures and is not paid at maturity.

Judgments

. One or more judgments, orders, or decrees shall be entered against the
Borrower or a Material Subsidiary of the Borrower involving a liability of
$25,000,000 or more, in the aggregate, (to the extent not paid or covered by
insurance provided by a carrier who has acknowledged coverage) and such
judgments, orders or decrees shall continue unsatisfied, undischarged and
unstayed for a period ending on the first to occur of (i) the last day on which
such judgment, order or decree becomes final and unappealable and, where
applicable, with the status of a judicial lien and (ii) 30 days.

 

Page 43

ERISA

. (i) The Borrower, a Material Subsidiary of the Borrower or any member of the
Controlled Group including the Borrower shall fail to pay when due an amount or
amounts aggregating in excess of $25,000,000 which it shall have become liable
to pay under Title IV of ERISA; or (ii) notice of intent to terminate a Plan or
Plans of the Borrower which in the aggregate have unfunded liabilities in excess
of $25,000,000 (individually and collectively, a "
Material Plan
") shall be filed under Title IV of ERISA by the Borrower or any member of the
Controlled Group including the Borrower, any plan administrator or any
combination of the foregoing; or (iii) the PBGC shall institute proceedings
under Title IV of ERISA to terminate, to impose liability (other than for
premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be
appointed to administer any Material Plan of the Borrower; or (iv) a condition
shall exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan of the Borrower must be terminated; or (v)
there shall occur a complete or partial withdrawal from, or a default, within
the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more
Multiemployer Plans which could cause one or more members of the Controlled
Group including the Borrower to incur a current payment obligation in excess of
$25,000,000.

Change of Control

. The occurrence of any Change of Control.

10.2    Acceleration; Remedies.

Upon the occurrence of an Event of Default, and at any time thereafter unless
and until such Event of Default has been waived by the Required Lenders or cured
to the satisfaction of the Required Lenders, the Administrative Agent may with
the consent of the Required Lenders, and shall, upon the request and direction
of the Required Lenders, by written notice to the Borrower take any of the
following actions without prejudice to the rights of the Administrative Agent or
any Lender to enforce its claims against the Borrower, except as otherwise
specifically provided for herein:

i. Termination of Commitments. Declare the Commitments terminated whereupon the
Commitments shall be immediately terminated.

ii. Acceleration of Loans. Declare the unpaid principal of and any accrued
interest on the Loans, and any and all other indebtedness or obligations of any
and every kind (including all amounts of L/C Obligations, whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented the
documents required thereunder) owing by the Borrower to any of the Lenders or
the Administrative Agent hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower.

iii. Enforcement of Rights. Enforce any and all rights and interests created and
existing under the Credit Documents, including, without limitation, all rights
of set-off, as against the Borrower.

Page 44

Notwithstanding the foregoing, if an Event of Default specified in Section
10.1(e) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid fees and
other indebtedness or obligations (including all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented the documents required thereunder) owing by the Borrower to the
Lenders and the Administrative Agent hereunder shall immediately become due and
payable without the giving of any notice or other action by the Administrative
Agent or the Lenders.

With respect to all Letters of Credit with respect to which presentment for
honor shall not have occurred at the time of an acceleration pursuant to this
Section 10.2, the Borrower shall at such time deposit in a cash collateral
account opened by the Administrative Agent an amount equal to the aggregate then
undrawn and unexpired amount of such Letters of Credit. Amounts held in such
cash collateral account shall be applied by the Administrative Agent to the
payment of drafts drawn under such Letters of Credit, and the unused portion
thereof after all such Letters of Credit shall have expired or been fully drawn
upon, if any, shall be applied to repay other obligations of the Borrower
hereunder and under the other Loan Documents. After all such Letters of Credit
shall have expired or been fully drawn upon, all Reimbursement Obligations shall
have been satisfied and all other obligations of the Borrower hereunder and
under the other Loan Documents shall have been paid in full, the balance, if
any, in such cash collateral account shall be returned to the Borrower (or such
other Person as may be lawfully entitled thereto).

10.3    Allocation of Payments After Event of Default.

Notwithstanding any other provisions of this Credit Agreement, after the
occurrence and during the continuance of an Event of Default, all amounts
collected or received by the Administrative Agent or any Lender on account of
amounts outstanding under any of the Credit Documents shall be paid over or
delivered as follows:

FIRST, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation reasonable outside attorneys' fees) of the
Administrative Agent or any of the Lenders in connection with enforcing the
rights of the Lenders under the Credit Documents and any protective advances
made by the Administrative Agent or any of the Lenders, pro rata as set forth
below;

SECOND, to payment of any fees owed to the Administrative Agent or any Lender,
pro rata as set forth below;

THIRD, to the payment of all accrued interest payable to the Lenders, pro rata
as set forth below;

FOURTH, to the payment of the outstanding principal amount of the Loans, pro
rata as set forth below;

FIFTH, to all other obligations which shall have become due and payable under
the Credit Documents and not repaid pursuant to clauses "FIRST" through "FOURTH"
above; and

Page 45

SIXTH, the payment of the surplus, if any, to whoever may be lawfully entitled
to receive such surplus.

In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category and (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on each Lender's Commitment Percentages) of amounts
available to be applied.

SECTION 11 AGENCY PROVISIONS

11.1     Appointment.

Each Lender hereby designates and appoints Barclays as administrative agent of
such Lender to act as specified herein and the other Credit Documents, and each
such Lender hereby authorizes the Administrative Agent, as the agent for such
Lender, to take such action on its behalf under the provisions of this Credit
Agreement and the other Credit Documents and to exercise such powers and perform
such duties as are expressly delegated by the terms hereof and of the other
Credit Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere herein and in
the other Credit Documents, the Administrative Agent shall not have any duties
or responsibilities, except those expressly set forth herein and therein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Credit Documents, or shall otherwise exist
against the Administrative Agent. The provisions of this Section are solely for
the benefit of the Administrative Agent and the Lenders and the Borrower shall
not have any rights as a third party beneficiary of the provisions hereof. In
performing its functions and duties under this Credit Agreement and the other
Credit Documents, the Administrative Agent shall act solely as agent of the
Lenders and does not assume and shall not be deemed to have assumed any
obligation or relationship of agency or trust with or for the Borrower.

11.2   Delegation of Duties.

The Administrative Agent may execute any of its duties hereunder or under the
other Credit Documents by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.

11.3   Exculpatory Provisions.

Neither the Administrative Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates shall be liable for any action lawfully
taken or omitted to be taken by it or such Person under or in connection
herewith or in connection with any of the other Credit Documents (except for its
or such Person's own gross negligence or willful misconduct), or responsible in
any manner to any of the Lenders for any recitals, statements, representations
or warranties made by the Borrower contained herein or in any of the other
Credit Documents or in any certificate, report, statement or other document
referred to or provided for in, or received by the Administrative Agent under or
in connection herewith or in connection with the other Credit Documents, or
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be responsible to any Lender for
the effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower in any written or oral statement or in any
financial or other statements, instruments, reports, certificates or any other
documents in connection herewith or therewith furnished or made by the
Administrative Agent to the Lenders or by or on behalf of the Borrower to the
Administrative Agent or any Lender or be required to ascertain or inquire as to
the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or of the existence or possible existence of any Default
or Event of Default or to inspect the properties, books or records of the
Borrower. The Administrative Agent is not a trustee for the Lenders and owes no
fiduciary duty to the Lenders. None of the Lenders identified on the facing page
or signature pages of this Agreement as "Syndication Agent" or "Co-Documentation
Agent" shall have any right, power, obligation, liability, responsibility or
duty under this Agreement other than those applicable to all Lenders as such,
nor shall they have or be deemed to have any fiduciary relationship with any
Lender.

Page 46

11.4    Reliance on Communications.

The Administrative Agent shall be entitled to rely, and shall be fully protected
in relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document or conversation reasonably believed by it to
be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Borrower, independent accountants and other
experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat the Lenders as the owner of its
interests hereunder for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent in accordance with Section 12.3(b). The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Credit
Agreement or under any of the other Credit Documents unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate or 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. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or under any of the other Credit Documents in accordance with a
request of the Required Lenders (or to the extent specifically provided in
Section 12.6, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).

11.5    Notice of Default.

The Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to the Credit Document, describing such Default or Event of Default and stating
that such notice is a "notice of default." In the event that the Administrative
Agent receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be directed by the Required
Lenders (or, to the extent specifically provided in Section 12.6, all the
Lenders).

Page 47

11.6    Non-Reliance on Administrative Agent and Other Lenders.

Each Lender expressly acknowledges that neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or affiliates
has made any representations or warranties to it and that no act by the
Administrative Agent or any affiliate thereof hereinafter taken, including any
review of the affairs of the Borrower, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon the Administrative Agent or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the Borrower
and made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Administrative Agent 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 analysis, appraisals and decisions in taking or not taking
action under this Credit Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the Borrower.
Except for (i) delivery of the Credit Documents and (ii) notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, assets, property, financial or other
conditions, prospects or creditworthiness of the Borrower which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.

11.7    Indemnification.

Each Lender agrees to indemnify the Administrative Agent in its capacity as such
(to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to its Loan Commitment
(as in effect at the time indemnification is sought hereunder), from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever which
may at any time (including without limitation at any time following the payment
of the Loans) be imposed on, incurred by or asserted against the Administrative
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Credit Documents or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Administrative Agent under or in
connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the gross negligence or willful misconduct of the Administrative
Agent. If any indemnity furnished to the Administrative Agent for any purpose
shall, in the opinion of the Administrative Agent, be insufficient or become
impaired, the Administrative Agent may call for additional indemnity and cease,
or not commence, to do the acts indemnified against until such additional
indemnity is furnished. The agreements in this Section shall survive the payment
of the Loans and all other amounts payable hereunder and under the other Credit
Documents.

Page 48

11.8    Administrative Agent in Its Individual Capacity.

The Administrative Agent and its Affiliates may make loans to, issue to or
participate in Letters of Credit by, accept deposits from and generally engage
in any kind of business with the Borrower as though the Administrative Agent
were not Administrative Agent hereunder. With respect to the Loans made by it,
the Administrative Agent shall have the same rights and powers under this Credit
Agreement as any Lender and may exercise the same as though they were not
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.

11.9    Successor Administrative Agent.

The Administrative Agent may, at any time, resign upon 30 days written notice to
the Lenders. Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment, within 30 days after the notice of
resignation, then the retiring Administrative Agent shall select a successor
Administrative Agent provided such successor is an Eligible Assignee (or if no
Eligible Assignee shall have been so appointed by the retiring Administrative
Agent and shall have accepted such appointment, then the Lenders shall perform
all obligations of the retiring Administrative Agent until such time, if any, as
a successor Administrative Agent shall have been so appointed and shall have
accepted such appointment as provided for above). Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations as Administrative Agent, as appropriate, under this Credit Agreement
and the other Credit Documents and the provisions of this Section 11.9 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Credit Agreement.

SECTION 12 MISCELLANEOUS

12.1     Notices.

Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device), (c)
the Business Day following the day on which the same has been delivered prepaid
(or pursuant to an invoice arrangement) to a reputable national overnight air
courier service, or (d) the third Business Day following the day on which the
same is sent by certified or registered mail, postage prepaid, in each case to
the respective parties at the address or telecopy numbers set forth on Schedule
12.1, or at such other address as such party may specify by written notice to
the other parties hereto.

Notices and other communications to any Lender hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Section 2 unless otherwise agreed by the Administrative Agent and
the applicable Lender. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

Page 49

12.2   Right of Set-Off; Adjustments.

In addition to any rights now or hereafter granted under applicable law or
otherwise, and not by way of limitation of any such rights, upon the occurrence
of an Event of Default by the Borrower and the commencement of remedies
described in Section 10.2, each Lender is authorized at any time and from time
to time, without presentment, demand, protest or other notice of any kind (all
of which rights being hereby expressly waived), to set-off and to appropriate
and apply any and all deposits (general or special) and any other indebtedness
at any time held or owing by such Lender (including, without limitation
branches, agencies or Affiliates of such Lender wherever located) to or for the
credit or the account of the Borrower against obligations and liabilities of the
Borrower to the Lenders hereunder, under the Loan Notes, the other Credit
Documents or otherwise, irrespective of whether the Administrative Agent or the
Lenders shall have made any demand hereunder and although such obligations,
liabilities or claims, or any of them, may be contingent or unmatured, and any
such set-off shall be deemed to have been made immediately upon the occurrence
of an Event of Default even though such charge is made or entered on the books
of such Lender subsequent thereto. The Borrower hereby agrees that any Person
purchasing a participation in the Loans and Commitments to it hereunder pursuant
to Section 12.3(c) may exercise all rights of set-off with respect to its
participation interest as fully as if such Person were a Lender hereunder.

Except to the extent that this Credit Agreement expressly provides for payments
to be allocated to a particular Lender, if any Lender (a "Benefitted Lender")
shall receive any payment of all or part of the obligations owing to it by the
Borrower under this Credit Agreement, receive any collateral in respect thereof
(whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 10.1(e), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of the obligations owing to such other Lender by the
Borrower under this Credit Agreement, such Benefitted Lender shall purchase for
cash from the other Lenders a participating interest in such portion of the
obligations owing to each such other Lender, or shall provide such other Lenders
with the benefits of any such collateral, as shall be necessary to cause such
Benefitted Lender to share the excess payment or benefits of such collateral
ratably with each of the Lenders; provided, however, that if all or any portion
of such excess payment or benefits is thereafter recovered from such Benefitted
Lender, such purchase shall be rescinded, and the purchase price and benefits
returned, to the extent of such recovery, but without interest.

Page 50

12.3    Benefit of Agreement.

Generally. This Credit Agreement shall be binding upon and inure to the benefit
of and be enforceable by the respective successors and assigns of the parties
hereto; provided that the Borrower may not assign and transfer any of its
interests (except as permitted by Section 9.2) without prior written consent of
the Lenders; and provided further that the rights of each Lender to transfer,
assign or grant participations in its rights and/or obligations hereunder shall
be limited as set forth in this Section 12.3.

Assignments

. Each Lender may assign all or a portion of its rights and obligations under
this Credit Agreement (including, without limitation, all or a portion of its
Loans, its Loan Notes, and its Commitment);
provided
,
however
, that:

i. each such assignment shall be to an Eligible Assignee;

ii. except (A) in the case of an assignment to another Lender or to an Affiliate
of a Lender, (B) in the case of an assignment of all of a Lender's rights and
obligations under this Credit Agreement, or (C) with the consent of the
Administrative Agent and the Borrower (such consent (i) of the Administrative
Agent and the Borrower not to be unreasonably withheld or delayed and (ii) of
the Borrower not being required during the existence of a Default or Event of
Default), any such partial assignment shall be in an amount at least equal to
$10,000,000 (or, if less, the remaining amount of the Commitment being assigned
by such Lender) or an integral multiple of $5,000,000 in excess thereof;

iii. each such assignment by a Lender shall be of a constant, and not varying,
percentage of all of its rights and obligations under this Credit Agreement and
the Loan Notes; and

iv. the parties to such assignment shall execute and deliver to the
Administrative Agent for its acceptance an Assignment Agreement in substantially
the form of Exhibit 12.3, together with a processing fee from the assignor of
$4,000.

Upon execution, delivery, and acceptance of such Assignment Agreement, the
assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Lender hereunder and
the assigning Lender shall, to the extent of such assignment, relinquish its
rights and be released from its obligations under this Credit Agreement. Upon
the consummation of any assignment pursuant to this Section 12.3(b), the
assignor, the Administrative Agent and the Borrower shall make appropriate
arrangements so that, if required, new Loan Notes are issued to the assignee. If
the assignee is not incorporated under the laws of the United States of America
or a State thereof, it shall deliver to the Borrower and the Administrative
Agent certification as to exemption from deduction or withholding of taxes in
accordance with Section 4.4.

Page 51

By executing and delivering an assignment agreement in accordance with this
Section 12.3(b), the assigning Lender thereunder and the assignee thereunder
shall be deemed to confirm to and agree with each other and the other parties
hereto as follows: (A) such assigning Lender warrants that it is the legal and
beneficial owner of the interest being assigned thereby free and clear of any
adverse claim and the assignee warrants that it is an Eligible Assignee; (B)
except as set forth in clause (A) above, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Credit Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto or the financial condition of the Borrower
or the performance or observance by the Borrower of any of its obligations under
this Credit Agreement, any of the other Credit Documents or any other instrument
or document furnished pursuant hereto or thereto; (C) such assignee represents
and warrants that it is legally authorized to enter into such assignment
agreement; (D) such assignee confirms that it has received a copy of this Credit
Agreement, the other Credit Documents and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such assignment agreement; (E) such assignee will independently and
without reliance upon the Administrative Agent, such assigning Lender 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 this Credit Agreement and the other Credit Documents;
(F) such assignee appoints and authorizes the Administrative Agent to take such
action on its behalf and to exercise such powers under this Credit Agreement or
any other Credit Document as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto; and (G) such assignee agrees that it will perform in accordance with
their terms all the obligations which by the terms of this Credit Agreement and
the other Credit Documents are required to be performed by it as a Lender.

For avoidance of doubt, the parties to this Credit Agreement acknowledge that
the provisions of this Section 12.3 concerning assignments relate only to
absolute assignments and that such provisions do not prohibit assignments
creating security interests, including any pledge or assignment by a Lender to
any Federal Reserve Bank in accordance with applicable law.

Register

. The Administrative Agent shall maintain a copy of each Assignment Agreement
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Commitment of, and principal amount of the
Loans owing to, each Lender from time to time by the Borrower (collectively, the
"Register"). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Administrative Agent and
the Lenders may treat each Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Credit Agreement. The Register shall
be available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.

Acceptance

. Upon its receipt of an assignment agreement executed by the parties thereto,
together with any Loan Note subject to such assignment and payment of the
processing fee, the Administrative Agent shall, if such Assignment Agreement has
been completed and is in substantially the form of Exhibit 12.3, (i) accept such
assignment agreement, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the parties thereto.

Page 52

Participations

. Each Lender may sell, transfer, grant or assign participations in all or any
part of such Lender's interests and obligations hereunder;
provided
that (i) such selling Lender shall remain a "Lender" for all purposes under this
Credit Agreement (such selling Lender's obligations under the Credit Documents
remaining unchanged) and the participant shall not constitute a Lender
hereunder, (ii) no such participant shall have, or be granted, rights to approve
any amendment or waiver relating to this Credit Agreement or the other Credit
Documents except to the extent any such amendment or waiver would (A) reduce the
principal of or rate of interest on or fees in respect of any Loans in which the
participant is participating, or (B) postpone the date fixed for any payment of
principal (including extension of the Maturity Date or the date of any mandatory
prepayment), interest or fees in respect of any Loans in which the participant
is participating, (iii) sub-participations by the participant (except to an
Affiliate, parent company or Affiliate of a parent company of the participant)
shall be permitted with the consent of the Borrower (which, in each case, shall
not be unreasonably withheld or delayed and shall not be required during the
existence of a Default or Event of Default), and (iv) any such participations
shall be in a minimum aggregate amount of $10,000,000 of the Loan Commitment and
in integral multiples of $5,000,000 in excess thereof. In the case of any such
participation, the participant shall not have any rights under this Credit
Agreement or the other Credit Documents (the participant's rights against the
selling Lender in respect of such participation to be those set forth in the
participation agreement with such Lender creating such participation) and all
amounts payable by the Borrower hereunder shall be determined as if such Lender
had not sold such participation;
provided
,
however
, that such participant shall be entitled to receive additional amounts under
Section 4 to the same extent that the Lender from which such participant
acquired its participation would be entitled to the benefit of such cost
protection provisions.

Payments

. No Eligible Assignee, participant or other transferee of any Lender's rights
shall be entitled to receive any greater payment under Section 4 than such
Lender would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's written consent.

Nonrestricted Assignments

. Notwithstanding any other provision set forth in this Credit Agreement, any
Lender may at any time assign and pledge all or any portion of its Loans and its
Loan Notes to any Federal Reserve Bank as collateral security pursuant to
Regulation A and any operating circular issued by such Federal Reserve Bank. No
such assignment shall release the assigning Lender from its obligations
hereunder.

Information

. Any Lender may furnish any information concerning the Borrower or any of its
Subsidiaries in the possession of such Lender from time to time to assignees and
participants (including prospective assignees and participants) who is notified
of the confidential nature of the information and agrees to use its reasonable
best efforts to keep confidential all non-public information from time to time
supplied to it.

12.4    No Waiver; Remedies Cumulative.

No failure or delay on the part of the Administrative Agent or any Lender in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower and the Administrative
Agent or any Lender shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or under any other
Credit Document preclude any other or further exercise thereof or the exercise
of any other right, power or privilege hereunder or thereunder. The rights and
remedies provided herein are cumulative and not exclusive of any rights or
remedies which the Administrative Agent or any Lender would otherwise have. No
notice to or demand on the Borrower in any case shall entitle the Borrower to
any other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Administrative Agent or the Lenders to
any other or further action in any circumstances without notice or demand.

Page 53

12.5    Payment of Expenses, etc.

The Borrower agrees to: (a) pay all reasonable out-of-pocket costs and expenses
of (i) the Administrative Agent and the Lead Arrangers in connection with the
negotiation, preparation, execution and delivery and administration of this
Credit Agreement and the other Credit Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and expenses of outside legal counsel to the Administrative Agent) and any
amendment, waiver or consent relating hereto and thereto including, but not
limited to, any such amendments, waivers or consents resulting from or related
to any work-out, renegotiation or restructure relating to the performance by the
Borrower under this Credit Agreement and (ii) of the Administrative Agent, the
Lead Arrangers and the Lenders in connection with enforcement of the Credit
Documents and the documents and instruments referred to therein (including,
without limitation, in connection with any such enforcement, the reasonable fees
and disbursements of outside counsel for the Administrative Agent and each of
the Lenders) against the Borrower; and (b) indemnify the Administrative Agent,
the Lead Arrangers and each Lender and its Affiliates, their respective
officers, directors, employees, representatives, and agents from and hold each
of them harmless against any and all losses, liabilities, claims, damages or
expenses incurred by any of them as a result of, or arising out of, or in any
way related to, or by reason of, any investigation, litigation or other
proceeding (whether or not the Administrative Agent, the Lead Arrangers or any
Lender and its Affiliates is a party thereto) related to the entering into
and/or performance of any Credit Document or the use of proceeds of any Loans
(including other extensions of credit) hereunder or the consummation of any
other transactions contemplated in any Credit Document by the Borrower,
including, without limitation, the reasonable fees and disbursements of outside
counsel incurred in connection with any such investigation, litigation or other
proceeding (but excluding any such losses, liabilities, claims, damages or
expenses to the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified).

12.6    Amendments, Waivers and Consents.

Neither this Credit Agreement nor any other Credit Document nor any of the terms
hereof or thereof may be amended, changed, waived, discharged or terminated
unless such amendment, change, waiver, discharge or termination is in writing
and signed by the Required Lenders and the Borrower; provided that no such
amendment, change, waiver, discharge or termination shall without the consent of
each Lender affected thereby:

extend the Maturity Date;

 

Page 54

reduce the rate or extend the time of payment of interest (other than as a
result of waiving the applicability of any post-default increase in interest
rates) thereon or fees hereunder;

reduce or forgive the principal amount of any Loan;

increase or extend the Commitment of a Lender over the amount thereof in effect
(it being understood and agreed that a waiver of any Default or Event of Default
or a waiver of any mandatory reduction in the Commitments shall not constitute a
change in the terms of any Commitment of any Lender);

release the Borrower from its obligations under the Credit Documents or consent
to the transfer or assignment of such obligations;

amend, modify or waive any provision of this Section or Section 3.6, 3.8,
10.1(a), 11.7, 12.2, 12.3 or 12.5;

reduce any percentage specified in, or otherwise modify, the definition of
Required Lenders; or

release all or substantially all of any cash collateral while any Letters of
Credit or Reimbursement Obligations remain outstanding.

Notwithstanding the above, no provisions of (a) Section 11 may be amended or
modified without the consent of the Administrative Agent and (b) Section 5 may
be amended or modified without the consent of each Issuing Lender.

Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans and each
Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy
Code supersede the unanimous consent provisions set forth herein.

12.7    Counterparts; Telecopy.

This Credit Agreement may be executed in any number of counterparts, each of
which where so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart. Delivery of executed counterparts by facsimile shall be
effective as an original and shall constitute a representation that an original
will be delivered.

12.8    Headings.

The headings of the sections and subsections hereof are provided for convenience
only and shall not in any way affect the meaning or construction of any
provision of this Credit Agreement.

Page 55

12.9    Defaulting Lender.

Each Lender understands and agrees that if such Lender is a Defaulting Lender
then it shall not be entitled to vote on any matter requiring the consent of the
Required Lenders or to object to any matter requiring the consent of all the
Lenders; provided, however, that all other benefits and obligations under the
Credit Documents shall apply to such Defaulting Lender.

12.10    Survival of Indemnification and Representations and Warranties.

All indemnities set forth herein and all representations and warranties made
herein shall survive the execution and delivery of this Credit Agreement, the
making of the Loans, and the repayment of the Loans and other obligations and
the termination of the Commitments hereunder.

12.11    GOVERNING LAW.

THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

The Borrower irrevocably consents to the service of process out of any competent
court in any action or proceeding brought in connection with this Credit
Agreement by the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at its address for notices pursuant to Section 12.1, such
service to become effective 30 days after such mailing. Nothing herein shall
affect the right of a Lender to serve process in any other manner permitted by
law.

12.12    WAIVER OF JURY TRIAL

.

EACH OF THE PARTIES TO THIS CREDIT AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.

12.13    Severability.

If any provision of any of the Credit Documents is determined to be illegal,
invalid or unenforceable, such provision shall be fully severable and the
remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.

12.14    Entirety.

This Credit Agreement together with the other Credit Documents represent the
entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the transactions
contemplated herein and therein.

Page 56

12.15    Binding Effect.

This Credit Agreement shall become effective at such time (the "Effective Date")
when all of the conditions set forth in Section 6.1 have been satisfied or
waived by the Lenders and this Credit Agreement shall have been executed by the
Borrower and the Administrative Agent, and the Administrative Agent shall have
received copies (telefaxed or otherwise) which, when taken together, bear the
signatures of each Lender, and thereafter this Credit Agreement shall be binding
upon and inure to the benefit of the Borrower, the Administrative Agent and each
Lender and their respective successors and permitted assigns.

12.16    Submission to Jurisdiction.

The Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of the Supreme Court of the State of
New York sitting in New York County and of the United States District Court of
the Southern District of New York, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Credit Agreement, or
for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Credit Agreement shall
affect any right that the Administrative Agent or any Lender may otherwise have
to bring any action or proceeding relating to this Credit Agreement against the
Borrower or its properties in the courts of any jurisdiction. The Borrower
hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have
to the laying of venue of any suit, action or proceeding arising out of or
relating to this Credit Agreement in any court referred to above. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court. The Borrower also hereby irrevocably and
unconditionally waives any right it may have to claim or recover in any legal
action or proceeding referred to in this Section any special, exemplary,
punitive or consequential damages.

12.17    Confidentiality.

Each of the Administrative Agent and each Lender agrees to keep confidential all
non-public information provided to it by the Borrower pursuant to this Agreement
that is designated by the Borrower as confidential; provided that nothing herein
shall prevent the Administrative Agent or any Lender from disclosing any such
information (a) to the Administrative Agent, any other Lender or any of its
Affiliates, (b) subject to an agreement to comply with the provisions of this
Section, to any actual or prospective Assignee or participant, (c) to its
employees, directors, agents, attorneys and accountants or those of any of its
affiliates, (d) upon the request or demand of any Governmental Authority, (e) in
response to any order of any court or other Governmental Authority or as may
otherwise be required pursuant to any requirement of law, (f) if required to do
so in connection with any litigation or similar proceeding, (g) that has been
publicly disclosed, (h) to the National Association of Insurance Commissioners
or any similar organization or any nationally recognized rating agency that
requires access to information about a Lender's investment portfolio in
connection with ratings issued with respect to such Lender, or (i) in connection
with the exercise of any remedy hereunder or under any other Credit Document.

Page 57

12.18    Designation of SPVs.

Notwithstanding anything to the contrary contained herein, any Lender, (a
"Granting Lender") may grant to a special purpose funding vehicle (an "SPV"),
identified as such in writing from time to time by such Granting Lender to the
Administrative Agent and the Borrower, the option to fund all or any part of any
Loan that such Granting Lender would otherwise be obligated to fund pursuant to
this Credit Agreement; provided that (i) nothing herein shall constitute a
commitment by any SPV to fund any Loan, (ii) if an SPV elects not to exercise
such option or otherwise fails to fund all or any part of such Loan, the
Granting Lender shall be obligated to fund such Loan pursuant to the terms
hereof, (iii) no SPV shall have any voting rights pursuant to Section 12.6 and
(iv) with respect to notices, payments and other matters hereunder, the
Borrower, the Administrative Agent and the Lenders shall not be obligated to
deal with an SPV, but may limit their communications and other dealings relevant
to such SPV to the applicable Granting Lender. The funding of a Loan by an SPV
hereunder shall utilize the Loan Commitment of the Granting Lender to the same
extent that, and as if, such Loan were funded by such Granting Lender.

As to any Loans or portion thereof made by it, each SPV shall have all the
rights that its applicable Granting Lender making such Loans or portion thereof
would have had under this Credit Agreement; provided, however, that each SPV
shall have granted to its Granting Lender an irrevocable power of attorney, to
deliver and receive all communications and notices under this Agreement (and any
related documents) and to exercise on such SPV's behalf, all of such SPV's
voting rights under this Credit Agreement. No additional Loan Note shall be
required to evidence the Loans or portion thereof made by an SPV; and the
related Granting Lender shall be deemed to hold its Loan Note as agent for such
SPV to the extent of the Loans or portion thereof funded by such SPV. In
addition, any payments for the account of any SPV shall be paid to its Granting
Lender as agent for such SPV.

Each party hereto hereby agrees that no SPV shall be liable for any indemnity or
payment under this Agreement for which a Lender would otherwise be liable for so
long as, and to the extent, the Granting Lender provides such indemnity or makes
such payment. In furtherance of the foregoing, each party hereto hereby agrees
(which agreements shall survive the termination of this Credit Agreement) that,
prior to the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPV, it will
not institute against, or join any other person in instituting against, such SPV
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof.

In addition, notwithstanding anything to the contrary contained in this Credit
Agreement, any SPV may (i) at any time and without paying any processing fee
therefor, assign or participate all or a portion of its interest in any Loans to
the Granting Lender or to any financial institutions providing liquidity and/or
credit support to or for the account of such SPV to support the funding or
maintenance of Loans and (ii) disclose on a confidential basis any non-public
information relating to its Loans to any rating agency, commercial paper dealer
or provider of any surety, guarantee or credit or liquidity enhancements to such
SPV. This Section 12.18 may not be amended without the written consent of any
Granting Lender affected thereby.

Page 58

12.19    USA Patriot Act.

Each Lender hereby notifies the Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001) (the "Act")), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender to identify the
Borrower in accordance with the Act.

[Remainder of Page Intentionally Blank]

 

 

 

 

 

 

Each of the parties hereto has caused a counterpart of this Credit Agreement to
be duly executed and delivered as of the date first above written.

CONSOLIDATED NATURAL GAS COMPANY
as the Borrower

By:  /s/ James P. Carney                     
Name: James P. Carney
Title: Assistant Treasurer

BARCLAYS BANK PLC
(Main Office: New York, New York)
as Administrative Agent, a Syndication Agent, a
Issuing Lender and a Lender

By:  /s/ Sydney G. Dennis                     
Name: Sydney G. Dennis
Title: Director

KEYBANK NATIONAL ASSOCIATION, as a
Syndication Agent, a Issuing Lender and as a
Lender

By:  /s/ Sherrie I. Manson                        
Name: Sherrie I. Manson
Title: Vice President

ABN AMRO BANK NV, as Co-Documentation
Agent and as a Lender

By:  /s/ Stephanie B. Casas                       
Name: Stephanie B. Casas
Title: Vice President

By:  /s/ John D. Reed                                
Name: John D. Reed
Title: Vice President

THE BANK OF NOVA SCOTIA, as Co-
Documentation Agent and as a Lender

By:   /s/ Thane Rattew                                
Name: Thane Rattew
Title: Director

SUNTRUST BANK, as Co-Documentation Agent,
a Issuing Lender and as a Lender

By:   /s/ Mark A. Flatin                               
Name: Mark A. Flatin
Title: Director

THE BANK OF TOKYO-MITSUBISHI, LTD.,
NEW YORK BRANCH, as a Lender

By:   /s/ Linda Tam                                       
Name: Linda Tam
Title: Authorized Signatory

BNP PARIBAS, as a Lender

By:   /s/ Francis J. DeLaney                           
Name: Francis J. DeLaney
Title: Managing Director

By:   /s/ Timothy F. Vincent                            
Name: Timothy F. Vincent
Title: Director

BAYERISCHE HYPO-UND VEREINSBANK AG
NEW YORK BRANCH, as a Lender

By:  /s/ William Hunter                                      
Name: William Hunter
Title: Director

By:   /s/ Shannon Batchman                                
Name: Shannon Batchman
Title: Director

NATIONAL AUSTRALIA BANK, as a Lender

By:    /s/ Michael Lorusso                                    
Name: Michael Lorusso
Title: SVP

MIZUHO CORPORATE BANK (USA), as a
Lender

By:   /s/ Raymond Ventura                                     
Name: Raymond Ventura
Title: Senior Vice President

SUMITOMO MITSUI BANKING
CORPORATION, as a Lender

By:   /s/ David A. Buck                                        
Name: David A. Buck
Title: Senior Vice President

HARRIS NESBITT FINANCING, INC., as a
Lender

By:  /s/ Cahal B. Carmody                                       
Name: Cahal B. Carmody
Title: Vice President

BAYERISCHE LANDESBANK, as a Lender

By:  /s/ Wolfgang Kottmann                                      
Name: Wolfgang Kottmann
Title: First Vice President

By:  /s/ James H. Boyle                                             
Name: James H. Boyle
Title: Vice President

THE ROYAL BANK OF SCOTLAND plc, as a
Lender

By:  /s/ Michael Keating                                            
Name: Michael Keating
Title: Managing Director

DRESDNER BANK, NEW YORK AND
GRAND CAYMAN BRANCHES, as a Lender

By:  /s/ Brian M. Smith                                               
Name: Brian M. Smith
Title: Managing Director

By:  /s/ Thomas R. Bradyn                                         
Name: Thomas R. Brady    
Title: Director

PNC BANK, NATIONAL ASSOCIATION, as a
Lender

By:   /s/ Thomas A. Majeski                                        
Name: Thomas A. Majeski
Title: Vice President

DEUTSCHE BANK AG NEW YORK BRANCH,
as the Lender

By:  /s/ Michael Starmer-Smith                                     
Name: Michael Starmer-Smith
Title: Managing Director

By:  /s/ Joel Makowsky                                                
Name: Joel Makowsky
Title: Director

KBC BANK N.V., as a Lender

By:   /s/ Jean-Pierre Diels                                              
Name: Jean-Pierre Diels
Title: First Vice President

By:  /s/ Robert Snauffer                                                  
Name: Robert Snauffer
Title: First Vice President

COMMERZBANK AG, NEW YORK AND
GRAND CAYMAN BRANCHES, as a Lender

By:   /s/ Steven Pottle                                                    
Name: Steven Pottle
Title: Vice President

By:  /s/ Barbara Stacks                                                  
Name: Barbara Stacks
Title: Assistant Treasurer

MELLON BANK, N.A., as a Lender

By:   /s/ Mark W. Rogers                                              
Name: Mark W. Rogers
Title: Vice President

JPMORGAN CHASE BANK, as a Lender

By:  /s/ Peter M. Ling                                                     
Name: Peter M. Ling
Title: Managing Director

LANDERSBANK BADEN-WUERTTEMBERG
NEW YORK BRANCH AND/OR CAYMAN
ISLAND BRANCH, as a Lender

By:  /s/ Karen Richard                                                 
Name: Karen Richard
Title: Vice President

By:  /s/ Carolyn Gutbrod                                              
Name: Carolyn Gutbrod
Title: Vice President

ALLIED IRISH BANK, as a Lender

By:   /s/ Aidan Lanigan                                                
Name: Aidan Lanigan
Title: Assistant Vice President

By:  /s/ Mark Connelly                                                 
Name: Mark Connelly
Title: Vice President

BANK HAPOALIM B.M.., as a Lender

By:  /s/ Marc Bosc                                                      
Name: Marc Bosc
Title: Vice President

By:  /s/ Leroy Hackett                                                  
Name: Leroy Hackett
Title:

THE NORINCHUKIN BANK, NEW YORK
BRANCH, as a Lender

By:   /s/ Tsukitani Toshifumi                                          
Name: Tsukitani Toshifumi
Title: General Manager

BRANCH BANKING & TRUST COMPANY OF
VIRGINIA, as a Lender

By:   /s/ J. Charles Link                                                
Name: J. Charles Link
Title: Senior Vice President

THE BANK OF NEW YORK, as a Lender

By:   /s/ Daniel S. Csillag                                             
Name: Daniel S. Csillag 
Title: AVP

CITINANK N.A., as a Lender

By:   /s/ Dhaya Ranganathan                                         
Name: Dhaya Ranganathan
Title: Director

UFJ Bank Limited, as a Lender

By:    /s/ John T. Feeney                                               
Name: John T. Feeney
Title: Vice President

NORDDEUTSCHE LANDESBANK
GIROZENTRALE NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH, as a
Lender

By:  /s/ Stephanie Finnen                                               
Name: Stephanie Finnen
Title: Vice President

By:  /s/ Aleksander S. Wolski                                        
Name: Aleksander S. Wolski
Title: Assistant Treasurer

ARAB BANK PLC, as a Lender

By:  /s/ John Korthuis                                               
Name: John Korthuis 
Title: Vice President

By:  /s/ William Ghazar                                               
Name: William Ghazar
Title: Vice President

FIRST COMMERCIAL BANK, as a Lender

By:  /s/ Josephine Chong                                            
Name: Josephine Chong
Title: Syndicated Loans Manager

SAN PAOLO IMI S.P.A., as a Lender

By:  /s/ Renato Carducci                                             
Name: Renato Carducci
Title: General Manager

By:  /s/ Glen Binder                                                    
Name: Glen Binder
Title: Vice President

ABU DHABI INTERNATIONAL BANK, as a
Lender

By:  /s/ David J. Young                                              
Name: David J. Young
Title: Vice President

By:  /s/ Nagy S. Kolta                                               
Name: Nagy S. Kolta
Title: Executive Vice President

THE INTERNATIONAL COMMERCIAL BANK
OF CHINA, as a Lender

By:  /s/ Nae-Yee Lung                                               
Name: Nae-Yee Lung
Title: SVP & General Manager