Exhibit 10(b)

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FIVE-YEAR

 

REVOLVING CREDIT AGREEMENT

 

Dated as of April 23, 2004

 

Among

 

ALCOA INC.,

 

THE LENDERS NAMED HEREIN,

 

CITIBANK, N.A., CREDIT SUISSE FIRST BOSTON and UBS AG, STAMFORD BRANCH,

 

as Syndication Agents,

 

DEUTSCHE BANK SECURITIES INC. and ABN AMRO BANK, N.V.,

 

as Documentation Agents, and

 

JPMORGAN CHASE BANK,

 

as Administrative Agent,

 

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J.P. MORGAN SECURITIES INC.,

 

as Sole Lead Arranger and Sole Bookrunner

 

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TABLE OF CONTENTS

 

     Page

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ARTICLE I DEFINITIONS AND CONSTRUCTION

   1    

SECTION 1.01.

   Defined Terms    1    

SECTION 1.02.

   Terms Generally; Accounting Principles    12

ARTICLE II THE CREDITS

   13    

SECTION 2.01.

   Commitments    13    

SECTION 2.02.

   Loans    13    

SECTION 2.03.

   Notice of Borrowings    14    

SECTION 2.04.

   Interest Elections    15    

SECTION 2.05.

   Evidence of Debt; Repayment of Loans    16    

SECTION 2.06.

   Fees    17    

SECTION 2.07.

   Interest on Loans    17    

SECTION 2.08.

   Default Interest    18    

SECTION 2.09.

   Alternate Rate of Interest    18    

SECTION 2.10.

   Termination and Reduction of Commitments    18    

SECTION 2.11.

   Prepayment    19    

SECTION 2.12.

   Reserve Requirements; Change in Circumstances    19    

SECTION 2.13.

   Change in Legality    21    

SECTION 2.14.

   Indemnity    21    

SECTION 2.15.

   Pro Rata Treatment    22    

SECTION 2.16.

   Sharing of Setoffs    22    

SECTION 2.17.

   Payments    23    

SECTION 2.18.

   Taxes    23    

SECTION 2.19.

   Assignment of Commitments Under Certain Circumstances    26

ARTICLE III REPRESENTATIONS AND WARRANTIES

   26    

SECTION 3.01.

   Organization    26    

SECTION 3.02.

   Authorization    26    

SECTION 3.03.

   Enforceability    27    

SECTION 3.04.

   Governmental Approvals    27    

SECTION 3.05.

   No Conflict    27    

SECTION 3.06.

   Financial Statements    27    

SECTION 3.07.

   No Defaults    27    

SECTION 3.08.

   Litigation    27    

SECTION 3.09.

   No Material Adverse Change    28    

SECTION 3.10.

   Employee Benefit Plans    28    

SECTION 3.11.

   Title to Properties; Possession Under Leases    29    

SECTION 3.12.

   Investment Company Act; Public Utility Holding Company Act    29    

SECTION 3.13.

   Tax Returns    29    

SECTION 3.14.

   Compliance with Laws and Agreements    29    

SECTION 3.15.

   No Material Misstatements    30    

SECTION 3.16.

   Federal Reserve Regulations    30    

SECTION 3.17.

   No Trusts    30

 

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ARTICLE IV CONDITIONS OF EFFECTIVENESS, LENDING AND DESIGNATION OF BORROWING
SUBSIDIARIES

   30    

SECTION 4.01.

   Effective Date    30    

SECTION 4.02.

   All Borrowings    31    

SECTION 4.03.

   Designation of Borrowing Subsidiaries    32

ARTICLE V AFFIRMATIVE COVENANTS

   33    

SECTION 5.01.

   Financial Statements, Reports, etc    33    

SECTION 5.02.

   Pari Passu Ranking    34    

SECTION 5.03.

   Maintenance of Properties    34    

SECTION 5.04.

   Obligations and Taxes    34    

SECTION 5.05.

   Insurance    35    

SECTION 5.06.

   Existence; Businesses and Properties    35    

SECTION 5.07.

   Compliance with Laws    35    

SECTION 5.08.

   Litigation and Other Notices    36    

SECTION 5.09.

   Borrowing Subsidiaries    36

ARTICLE VI NEGATIVE COVENANTS

   36    

SECTION 6.01.

   Liens    36     SECTION 6.02.    Consolidation, Merger, Sale of Assets, etc.
   37     SECTION 6.03.    Financial Undertaking    38     SECTION 6.04.   
Change in Business    38

ARTICLE VII EVENTS OF DEFAULT

   38

ARTICLE VIII GUARANTEE

   42

ARTICLE IX THE ADMINISTRATIVE AGENT

   43

ARTICLE X MISCELLANEOUS

   45    

SECTION 10.01.

   Notices    45    

SECTION 10.02.

   Survival of Agreement    46    

SECTION 10.03.

   Binding Effect    47    

SECTION 10.04.

   Successors and Assigns; Additional Borrowing Subsidiaries    47    

SECTION 10.05.

   Expenses; Indemnity    50    

SECTION 10.06.

   Right of Setoff    51    

SECTION 10.07.

   Applicable Law    51    

SECTION 10.08.

   Waivers; Amendment    51    

SECTION 10.09.

   Interest Rate Limitation    52    

SECTION 10.10.

   Entire Agreement    52    

SECTION 10.11.

   Waiver of Jury Trial    52    

SECTION 10.12.

   Severability    53    

SECTION 10.13.

   Counterparts    53    

SECTION 10.14.

   Headings    53    

SECTION 10.15.

   Jurisdiction, Consent to Service of Process    53    

SECTION 10.16.

   Conversion of Currencies    53    

SECTION 10.17.

   USA Patriot Act    54

 

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References

 

Exhibit A   Assignment and Assumption Exhibit B   Administrative Questionnaire
Exhibit C   Form of Opinion of Counsel Exhibit D   Designation of Borrowing
Subsidiary Schedule 2.01   Lenders and Commitments Schedule 3.04   Governmental
Approvals Schedule 3.08   Litigation Schedule 6.01(a)   Existing Liens

 

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FIVE-YEAR REVOLVING CREDIT AGREEMENT dated as of April 23, 2004 (as the same may
be amended, modified or supplemented from time to time, the “Agreement”), among
ALCOA INC., a Pennsylvania corporation (“Alcoa”), the Lenders (such term and
each other capitalized term used but not defined herein having the meaning
ascribed thereto in Article I), and JPMORGAN CHASE BANK, a New York banking
corporation, as Administrative Agent for the Lenders.

 

Alcoa and the Borrowing Subsidiaries have requested the Lenders to extend credit
in order to enable Alcoa and the Borrowing Subsidiaries, subject to the terms
and conditions of this Agreement, to borrow on a revolving basis, at any time
and from time to time prior to the Maturity Date, an aggregate principal amount
at any time outstanding not in excess of US$1,000,000,000. The proceeds of such
borrowings are to be used to provide working capital and for other general
corporate purposes, including but not limited to the support of Alcoa’s
commercial paper program. The Lenders are willing to extend such credit to Alcoa
and the Borrowing Subsidiaries on the terms and subject to the conditions set
forth herein.

 

Accordingly, the Borrowers, the Lenders and the Administrative Agent agree as
follows:

 

ARTICLE I

 

DEFINITIONS AND CONSTRUCTION

 

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms
shall have the meanings set forth below:

 

“ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.

 

“ABR Loan” shall mean any Loan bearing interest at a rate determined by
reference to the Alternate Base Rate in accordance with the provisions of
Article II.

 

“Administrative Agent” shall mean JPMorgan Chase Bank, a New York banking
corporation, in its capacity as administrative agent for the Lenders hereunder.

 

“Administrative Questionnaire” shall mean an Administrative Questionnaire in the
form of Exhibit B.

 

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“Affiliate” shall mean, when used with respect to a specified person, another
person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the person specified.

 

“Alternate Base Rate” shall mean, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the
Prime Rate in effect on such day, (b) the Base CD Rate in effect on such day
plus 1% and (c) the Federal Funds Effective Rate in effect on such day plus ½ of
1%. For purposes hereof, “Prime Rate” shall mean the rate of interest per annum
publicly announced from time to time by the Administrative Agent as its prime
rate in effect at its principal office in New York City; each change in the
Prime Rate shall be effective on the date such change is publicly announced as
being effective. “Base CD Rate” shall mean the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) Statutory Reserves and (b) the Assessment
Rate. “Three-Month Secondary CD Rate” shall mean, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day shall not be a Business Day, the next preceding
Business Day) by the Board through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical Release H.l5(519)
during the week following such day), or, if such rate shall not be so reported
on such day or such next preceding Business Day, the average of the secondary
market quotations for three month certificates of deposit of major money center
banks in New York City received at approximately 10:00 a.m., New York City time,
on such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it. “Federal
Funds Effective Rate” shall mean, for any day, the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the quotations for
the day of such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it. If for any reason
the Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Base CD
Rate or the Federal Funds Effective Rate or both for any reason, including the
inability of the Administrative Agent to obtain sufficient quotations in
accordance with the terms thereof, the Alternate Base Rate shall be determined
without regard to clause (b) or (c), or both, of the first sentence of this
definition, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the Alternate Base Rate due to a change
in the Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate shall be effective on the effective date of such change in the
Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds Effective
Rate, respectively.

 

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“Applicable Margin” shall mean, with respect to the LIBOR Loans comprising any
Borrowing, the applicable percentage set forth below based upon the ratings by
S&P and Moody’s applicable on such date to the Index Debt:

 

     Percentage

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Category 1

    

AA-/Aa3 or above

   .0750%

Category 2

    

A+/A1

   .1225%

Category 3

    

A/A2

   .1700%

Category 4

    

A-/A3

   .4150%

Category 5

    

BBB/Baa2

   .6350%

Category 6

    

BBB-/Baa3 or below

   .8350%

 

For purposes of the foregoing, (i) if neither Moody’s nor S&P shall have in
effect a rating for any Index Debt (other than by reason of the circumstances
referred to in the last sentence of this definition), then both such rating
agencies shall be deemed to have established ratings for such Index Debt in
Category 6; (ii) if only one of Moody’s and S&P shall have in effect a rating
for any Index Debt, then the Applicable Margin, to the extent determined by
reference to such Index Debt, shall be determined on the basis of such rating;
(iii) if the ratings established or deemed to have been established by Moody’s
or S&P for any Index Debt shall fall within different Categories, the Applicable
Margin shall be based on the Category corresponding to the higher rating unless
the ratings differ by two or more Categories, in which case the Applicable
Margin will be based upon the Category one level above the Category
corresponding to the lower rating; and (iv) if any rating established or deemed
to have been established by Moody’s or S&P shall be changed (other than as a
result of a change in the rating system of Moody’s or S&P), such change shall be
effective as of the date on which it is first announced by the applicable rating
agency. Each change in the Applicable Margin shall apply during the period
commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change. If the rating
system of Moody’s or S&P shall change, or if any such rating agency shall cease
to be in the business of rating corporate debt obligations, Alcoa and the
Lenders shall negotiate in good faith to amend the references to specific
ratings in this definition to reflect such changed rating system or the
non-availability of ratings from such rating agency, and pending the
effectiveness of any such amendment, the ratings of such rating agency most
recently in effect prior to such change or cessation shall be employed in
determining the Applicable Margin.

 

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“Approved Fund” shall have the meaning assigned to such term in Section
10.04(b).

 

“Assessment Rate” shall mean, for any date, the annual rate (rounded upwards, if
necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that will be
employed in determining amounts payable by the Administrative Agent to the
Federal Deposit Insurance Corporation (or any successor) for such date for
insurance by such Corporation (or such successor) of time deposits made in
dollars at the Administrative Agent’s domestic offices.

 

“Assignment and Assumption” shall mean an assignment and assumption entered into
by a Lender and an assignee, and accepted by the Administrative Agent, in
substantially the form of Exhibit A or such other form as shall be approved by
the Administrative Agent.

 

“Board” shall mean the Board of Governors of the Federal Reserve System of the
United States.

 

“Borrowers” shall mean Alcoa and the Borrowing Subsidiaries.

 

“Borrowing” shall mean any group of Loans of a single Type made by the Lenders
on a single date and as to which a single Interest Period is in effect.

 

“Borrowing Subsidiaries” shall mean, at any time, the wholly-owned Subsidiaries
of Alcoa that have undertaken the obligations of Borrowing Subsidiaries pursuant
to Section 10.04(e).

 

“Borrowing Subsidiary Obligations” shall mean, collectively, the due and
punctual payment by any Borrowing Subsidiary of the principal of and interest on
the Loans to it, when and as due, whether at maturity, by acceleration or
otherwise, and the due and punctual payment and performance of all other
obligations of such Borrowing Subsidiary under this Agreement.

 

“Business Day” shall mean any day (other than a day which is a Saturday, Sunday
or day on which banks in New York City are authorized or required by law to
remain closed); provided, however, that, when used in connection with any LIBOR
Loan, the term “Business Day” shall in each case also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.

 

“CLO” shall have the meaning assigned to such term in Section 10.04(b).

 

“Code” shall mean the Internal Revenue Code of 1986, as the same may be amended
from time to time.

 

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“Commercial Paper” of any person shall mean any note, draft, bill of exchange or
other negotiable instrument issued by such person (other than any extendable
commercial notes issued pursuant to Section 4(2) of the Securities Act of 1933)
that has a maturity at the time of issuance not exceeding thirteen months,
exclusive of days of grace, or any renewal thereof the maturity of which is
likewise limited, pursuant to Section 3(a)(3) or Section 4(2) of the Securities
Act of 1933.

 

“Commitment” shall mean, with respect to each Lender, the commitment of such
Lender to make Loans hereunder as set forth in Schedule 2.01 or in any
Assignment and Assumption pursuant to which such Lender first becomes a Lender
hereunder, as the same may be terminated or reduced from time to time pursuant
to Section 2.10.

 

“Consolidated Net Tangible Assets” shall mean at any time, the aggregate amount
of assets (less applicable reserves and other properly deductible items) of
Alcoa and its consolidated Subsidiaries adjusted for inventories on the basis of
cost (before application of the “last-in first-out” method of determining cost)
or current market value, whichever is lower, and deducting therefrom (a) all
current liabilities of such corporation and its consolidated Subsidiaries except
for (i) notes and loans payable, (ii) current maturities of long-term debt and
(iii) current maturities of obligations under capital leases and (b) all
goodwill, trade names, patents, unamortized debt discount and expenses of such
corporation and its consolidated Subsidiaries (to the extent included in said
aggregate amount of assets) and other like intangibles, all as set forth in the
most recent consolidated balance sheet of Alcoa and its consolidated
Subsidiaries, delivered to the Administrative Agent pursuant to Section 5.01,
computed and consolidated in accordance with GAAP.

 

“Consolidated Net Worth” shall mean at any time, the net worth of Alcoa and its
consolidated Subsidiaries at such time (including minority interests), computed
and consolidated in accordance with GAAP.

 

“Control” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a person, whether
through the ownership of Voting Stock, by contract or otherwise, and
“Controlling” and “Controlled” shall have meanings correlative thereto.

 

“Default” shall mean any event or condition which upon notice, lapse of time or
both would constitute an Event of Default.

 

“Designation Date” shall have the meaning assigned to such term in Section
10.04(e).

 

“Designation of Borrowing Subsidiary” shall mean a Designation of Borrowing
Subsidiary executed by Alcoa and a wholly-owned Subsidiary in substantially the
form of Exhibit D.

 

“dollars” or “$” shall mean lawful money of the United States of America.

 

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“Effective Date” shall mean the date of this Agreement.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the
same may be amended from time to time.

 

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated)
that is a member of a group of which any Borrower is a member and which is
treated as a single employer under Section 414 of the Code.

 

“ERISA Event” shall mean (i) any Reportable Event; (ii) the adoption of any
amendment to a Plan that would require the provision of security pursuant to
Section 401(a)(29) of the Code or Section 307 of ERISA; (iii) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (iv)
the filing pursuant to Section 412(d) of the Code or Section 302(d) of ERISA of
an application for a waiver of the minimum funding standard with respect to any
Plan; (v) the incurrence of any liability under Title IV of ERISA with respect
to the termination of any Plan or the withdrawal or partial withdrawal of the
Borrower or any of its ERISA Affiliates from any Plan or Multiemployer Plan;
(vi) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to the intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (vii) the receipt by the
Borrower or any ERISA Affiliate of any notice concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA; (viii) the occurrence of a “prohibited transaction” with respect to
which the Borrower or any of its subsidiaries is a “disqualified person” (within
the meaning of Section 4975 of the Code) or with respect to which the Borrower
or any such subsidiary could otherwise be liable; (ix) any other similar event
or condition with respect to a Plan or Multiemployer Plan that could result in
liability of the Borrowers and (x) any Foreign Benefit Event.

 

“Event of Default” shall have the meaning assigned to such term in Article VII.

 

“Exchange Act Report” shall mean the Annual Report of Alcoa on Form 10-K for the
year ended December 31, 2003, filed by Alcoa with the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934.

 

“Existing 364-Day Credit Agreement” shall mean the 364-Day Revolving Credit
Agreement dated as of April 25, 2003, among Alcoa, the lenders party thereto,
JPMorgan Chase Bank, as Administrative Agent, and J.P. Morgan Securities Inc.,
as lead arranger and bookrunner.

 

“Facility Fee” shall have the meaning assigned to such term in Section 2.06(a).

 

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“Facility Fee Percentage” shall mean on any date the applicable percentage set
forth below based upon the ratings by S&P and Moody’s, respectively, applicable
on such date to the Index Debt:

 

     Percentage

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

Category 1

    

AA-/Aa3 or above

   .0750%

Category 2

    

A+/A1

   .0775%

Category 3

    

A/A2

   .0800%

Category 4

    

A-/A3

   .0850%

Category 5

    

BBB/Baa2

   .1150%

Category 6

    

BBB-/Baa3 or below

   .1650%

 

For purposes of the foregoing, (i) if neither Moody’s nor S&P shall have in
effect a rating for the Index Debt (other than by reason of the circumstances
referred to in the last sentence of this definition), then both such rating
agencies shall be deemed to have established ratings in Category 6; (ii) if only
one of Moody’s and S&P shall have in effect a rating for the Index Debt, then
the Facility Fee Percentage shall be determined on the basis of such rating;
(iii) if the ratings established or deemed to have been established by Moody’s
or S&P for any Index Debt shall fall within different Categories, the Facility
Fee Percentage shall be based on the Category corresponding to the higher rating
unless the ratings differ by two or more Categories, in which case the Facility
Fee Percentage will be based upon the Category one level above the Category
corresponding to the lower rating; and (iv) if any rating established or deemed
to have been established by Moody’s or S&P shall be changed (other than as a
result of a change in the rating system of Moody’s or S&P), such change shall be
effective as of the date on which it is first announced by the applicable rating
agency. Each change in the Facility Fee Percentage shall apply during the period
commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change. If the rating
system of Moody’s or S&P shall change, or if either of such rating agencies
shall cease to be in the business of rating corporate debt obligations, Alcoa
and the Lenders shall negotiate in good faith to amend the references to
specific ratings in this definition to reflect such changed rating system or the
non-availability of ratings from such rating agency, and pending the
effectiveness of any such amendment, the ratings of such rating agency most
recently in effect prior to such change or cessation shall be employed in
determining the Facility Fee Percentage.

 

7

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“Financial Officer” of any corporation shall mean the chief financial officer,
principal accounting officer, Treasurer or Controller of such corporation.

 

“Foreign Benefit Event” shall mean (a) with respect to any Foreign Pension Plan,
(i) the existence of unfunded liabilities in excess of the amount permitted
under any applicable law, or in excess of the amount that would be permitted
absent a waiver from a Governmental Authority, (ii) the failure to make the
required contributions or payments, under any applicable law, on or before the
due date for such contributions or payments, (iii) the receipt of a notice by a
Governmental Authority relating to the intention to terminate any such Foreign
Pension Plan or to appoint a trustee to administer any such Foreign Pension
Plan, or to the insolvency of any such Foreign Pension Plan and (iv) the
incurrence of any liability of the Borrowers under applicable law on account of
the complete or partial termination of such Foreign Pension Plan or the complete
or partial withdrawal of any participating employer therein and (b) with respect
to any Foreign Plan, (i) the occurrence of any transaction that is prohibited
under any applicable law and could result in the incurrence of any liability by
the Borrowers, or the imposition on the Borrowers of any fine, excise tax or
penalty resulting from any noncompliance with any applicable law and (ii) any
other event or condition that could reasonably be expected to result in
liability of any of the Borrowers.

 

“Foreign Plan” shall mean any plan or arrangement established or maintained
outside the United States for the benefit of present or former employees of any
of the Borrowers.

 

“Foreign Pension Plan” shall mean any benefit plan which under applicable law is
required to be funded through a trust or other funding vehicle other than a
trust or funding vehicle maintained exclusively by a Governmental Authority.

 

“GAAP” shall mean generally accepted accounting principles, as used in, and
applied on a basis consistent with, the financial statements of Alcoa referred
to in Section 3.06.

 

“Governmental Authority” shall mean any Federal, state, local or foreign court
or governmental agency, authority, instrumentality or regulatory body.

 

“Guarantee” of or by any person shall mean any obligation, contingent or
otherwise, of such person guaranteeing any Indebtedness of any other person,
whether directly or indirectly, and including any obligation of such person,
direct or indirect, to purchase or pay such Indebtedness or to purchase any
security for the payment of such Indebtedness; provided, however, that the term
“Guarantee” shall not include endorsements for collection or deposit, in either
case in the ordinary course of business.

 

“Indebtedness” of any person at any time shall mean, without duplication, (a)
all obligations for money borrowed or raised, all obligations (other than
accounts payable and other similar items arising in the ordinary course of
business) for the

 

8

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deferred payment of the purchase price of property, and all capital lease
obligations which, in each case, in accordance with GAAP, would be included in
determining total liabilities as shown on the liability side of the balance
sheet of such person and (b) all Guarantees of such person.

 

“Index Debt” shall mean the senior, unsecured, non-credit enhanced, long–term
Indebtedness for borrowed money of Alcoa.

 

“Interest Election Request” means a request by any Borrower to convert a
Borrowing to a different Type or to continue such Borrowing in its existing Type
in accordance with Section 2.04.

 

“Interest Payment Date” shall mean, with respect to any Loan, the last day of
the Interest Period applicable to the Borrowing of which such Loan is a part
and, in the case of a LIBOR Borrowing with an Interest Period of more than three
months’ duration, each day that would have been an Interest Payment Date had
successive Interest Periods of three months’ duration been applicable to such
Borrowing, and, in addition, the effective date of any continuation of such
Borrowing in its existing Type or conversion of such Borrowing to a Borrowing of
a different Type, and the Maturity Date.

 

“Interest Period” shall mean (a) as to any LIBOR Borrowing, the period
commencing on the date of such Borrowing or on the last day of the immediately
preceding Interest Period applicable to such Borrowing, as the case may be, and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter, as the Borrower to which such Loan is made may elect; and (b)
as to any ABR Borrowing, the period commencing on the date of such Borrowing or
on the last day of the immediately preceding Interest Period applicable to such
Borrowing, as the case may be, and ending on the earliest of (i) the next
succeeding March 31, June 30, September 30 or December 31, (ii) the Maturity
Date and (iii) the date such Borrowing is prepaid in accordance with Section
2.11; provided, however, that if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of a LIBOR Borrowing only, such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day.

 

“Lenders” shall mean (a) the financial institutions listed on Schedule 2.01
(other than any such financial institution that has ceased to be a party hereto
pursuant to an Assignment and Assumption) and (b) any financial institution that
has become a party hereto pursuant to an Assignment and Assumption.

 

“LIBO Rate” shall mean, with respect to any LIBOR Borrowing for any Interest
Period, an interest rate (rounded upwards, if necessary, to the next 1/16 of 1%)
equal to the offered rate for dollar deposits for a period equal to the Interest
Period for such LIBOR Borrowing that appears on the LIBO page on the Reuters
Screen (or any page that can reasonably be considered a replacement page) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period. If

 

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such rate is not available on the Reuters Screen, the “LIBO Rate” shall be the
rate (rounded upwards, if necessary, to the next 1/16 of 1%) equal to the
arithmetic average of the respective rates per annum at which dollar deposits
approximately equal in principal amount to such LIBOR Borrowing and for a
maturity comparable to such Interest Period are offered in immediately available
funds to the London branches of the Reference Banks in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period. The Administrative Agent shall determine
the LIBO Rate and such determination shall be conclusive absent manifest error.

 

“LIBOR Borrowing” shall mean a Borrowing comprised of LIBOR Loans.

 

“LIBOR Loan” shall mean any Loan bearing interest at a rate determined by
reference to the LIBO Rate in accordance with the provisions of Article II.

 

“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, encumbrance, charge or security interest in or on such asset, (b)
the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement relating to such asset and (c) in the
case of securities, any purchase option, call or similar right of a third party
with respect to such securities.

 

“Loans” shall have the meaning assigned to it in Section 2.01. Each Loan shall
be a LIBOR Loan or an ABR Loan.

 

“Material Adverse Effect” shall mean a materially adverse effect on the
business, assets, operations or financial condition of Alcoa and its
Subsidiaries taken as a whole, or a material impairment of the ability of Alcoa
to perform any of its obligations under this Agreement.

 

“Maturity Date” shall mean April 23, 2009.

 

“Moody’s” shall mean Moody’s Investors Service, Inc.

 

“Multiemployer Plan” shall mean a multiemployer plan as defined in Section
4001(a)(3) of ERISA to which any Borrower or any ERISA Affiliate (other than one
considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Section
414 of the Code) is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an obligation to
make contributions.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.

 

“person” shall mean any natural person, corporation organization, business
trust, joint venture, association, company, partnership or government, or any
agency or political subdivision thereof.

 

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“Plan” shall mean any pension plan (other than a Multiemployer Plan) subject to
the provisions of Title IV of ERISA or Section 412 of the Code which is
maintained for employees of any Borrower or any ERISA Affiliate.

 

“Pro Rata Percentage” of any Lender at any time shall mean the percentage of the
Total Commitment that is represented by such Lender’s Commitment.

 

“Reference Banks” shall mean JPMorgan Chase Bank, Mellon Bank, N.A. and Bank of
America, N.A.

 

“Register” shall have the meaning given such term in Section 10.04(b).

 

“Related Parties” means, with respect to any specified person, such person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such person and such person’s Affiliates.

 

“Reportable Event” shall mean any reportable event as defined in Section 4043(b)
of ERISA or the regulations issued thereunder with respect to a Plan (other than
a Plan maintained by an ERISA Affiliate which is considered an ERISA Affiliate
only pursuant to subsection (m) or (o) of Section 414 of the Code).

 

“Required Lenders” shall mean Lenders representing at least 51% in principal
amount of the outstanding Loans and unused Commitments.

 

“Responsible Officer” of any corporation shall mean any executive officer or
Financial Officer of such corporation and any other officer or similar official
thereof responsible for the administration of the obligations of such
corporation in respect of this Agreement.

 

“Restricted Subsidiary” shall mean any consolidated Subsidiary of Alcoa which
owns any manufacturing plant or manufacturing facility located in the United
States, except any such plant or facility which, in the opinion of the Board of
Directors of Alcoa, is not of material importance to the business of Alcoa and
its Restricted Subsidiaries, taken as a whole, excluding any such Subsidiary
which (a) is principally engaged in leasing or financing receivables, (b) is
principally engaged in financing Alcoa’s operations outside the United States or
(c) principally serves as a partner in a partnership.

 

“S&P” shall mean Standard & Poor’s Ratings Services, a Division of The
McGraw-Hill Companies, Inc.

 

“Statutory Reserves” shall mean a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board and any other banking authority to which the
Administrative Agent is subject for new negotiable nonpersonal time deposits in
dollars of over $100,000 with maturities approximately equal to three months.
Such reserve percentages shall include those

 

11

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imposed pursuant to such Regulation D of the Board. Statutory Reserves shall be
adjusted automatically on and as of the effective date of any change in any
reserve percentage.

 

“Subsidiary” shall mean, with respect to any person (herein referred to as the
“parent”), any corporation, partnership, association or other business entity of
which securities or other ownership interests representing more than 50% of the
Voting Stock or more than 50% of the general partnership interests are, at the
time any determination is being made, owned, controlled or held by the parent or
one or more Subsidiaries of the parent or by the parent and one or more
Subsidiaries of the parent.

 

“364-Day Credit Agreement” shall mean the 364-Day Revolving Credit Agreement
dated as of April 23, 2004, among Alcoa, the lenders party thereto, JPMorgan
Chase Bank, as Administrative Agent, and J.P. Morgan Securities Inc., as lead
arranger and bookrunner.

 

“Total Commitment” shall mean, at any time, the aggregate amount of the
Commitments, as in effect at such time.

 

“2001 Five-Year Credit Agreement” shall mean the Amended and Restated Five-Year
Revolving Credit Agreement dated as of April 27, 2001, and maturing on April 28,
2005, among Alcoa, the lenders party thereto, JPMorgan Chase Bank, as
Administrative Agent, and J.P. Morgan Securities Inc., as lead arranger and
bookrunner.

 

“2003 Five-Year Credit Agreement” shall mean the Five-Year Revolving Credit
Agreement dated as of April 25, 2003, and maturing on April 25, 2008, among
Alcoa, the lenders party thereto, JPMorgan Chase Bank, as Administrative Agent,
and J.P. Morgan Securities Inc., as lead arranger and bookrunner.

 

“Type”, when used in respect of any Loan or Borrowing, shall refer to the Rate
by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined. For purposes hereof, “Rate” shall mean the LIBO Rate
and the Alternate Base Rate.

 

“Voting Stock” with respect to the stock of any person means stock of any class
or classes (however designated) having ordinary voting power for the election of
the directors of such person, other than stock having such power only by reason
of the occurrence of a contingency.

 

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.

 

SECTION 1.02. Terms Generally; Accounting Principles. The definitions in Section
1.01 shall apply equally to both the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include”,
“includes” and “including”

 

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shall be deemed to be followed by the phrase “without limitation”. All
references herein to Articles, Sections, Exhibits and Schedules shall be deemed
references to Articles and Sections of, and Exhibits and Schedules to, this
Agreement unless the context shall otherwise require. Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided,
however, that, if Alcoa notifies the Administrative Agent that it requests an
amendment to any provision hereof to eliminate the effect of any change in GAAP
on the operation of such provision (or if the Administrative Agent notifies
Alcoa that the Required Lenders request an amendment to any provision hereof for
such purpose), regardless of whether any such notice is given before or after
such change in GAAP (provided such change in GAAP occurs after the date hereof),
then such provision shall be interpreted on the basis of GAAP in effect
immediately before such change became effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.

 

ARTICLE II

 

THE CREDITS

 

SECTION 2.01. Commitments. Subject to the terms and conditions and relying upon
the representations and warranties herein set forth, each Lender agrees,
severally and not jointly, to make revolving credit loans in dollars (the
“Loans”) to Alcoa and the Borrowing Subsidiaries, at any time and from time to
time on or after the Effective Date and until the earlier of the Maturity Date
and the termination of the Commitment of such Lender in accordance with the
terms hereof; provided, however, that (i) after giving effect to any Loan, the
aggregate principal amount of the outstanding Loans shall not exceed the Total
Commitment and (ii) at all times the aggregate principal amount of all
outstanding Loans made by each Lender shall equal its Pro Rata Percentage of the
aggregate principal amount of all outstanding Loans. The Commitment of each
Lender is set forth on Schedule 2.01 to this Agreement or in any applicable
Assignment and Assumption. Such Commitment may be terminated or reduced from
time to time pursuant to Section 2.10 and increased, decreased or terminated
pursuant to Section 10.4. Within the limits set forth in the preceding sentence,
the Borrowers may borrow, pay or prepay and reborrow Loans on or after the
Effective Date and prior to the Maturity Date, subject to the terms, conditions
and limitations set forth herein.

 

SECTION 2.02. Loans. (a) Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
respective applicable Commitments; provided, however, that the failure of any
Lender to make any Loan shall not in itself relieve any other Lender of its
obligation to lend hereunder (it being understood, however, that no Lender shall
be responsible for the failure of any other Lender to make any Loan required to
be made by such other Lender). The Loans comprising each Borrowing shall be in
an aggregate principal amount which is an integral multiple of $1,000,000 and
not less than $10,000,000 (or an aggregate principal amount equal to the
remaining balance of the applicable Commitments, as the case may be).

 

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(b) Each Borrowing shall be comprised entirely of LIBOR Loans or ABR Loans, as
the applicable Borrower may request pursuant to Section 2.03. Each Lender may at
its option fulfill its Commitment with respect to any Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan;
provided, however, that any exercise of such option shall not affect the
obligation of the applicable Borrower to repay such Loan in accordance with the
terms of this Agreement. Borrowings of more than one Type may be outstanding at
the same time; provided, however, that no Borrower shall be entitled to request
any Borrowing which, if made, would result in an aggregate of more than five
separate LIBOR Loans of any Lender being made to the Borrowers and outstanding
under this Agreement at any one time. For purposes of the foregoing, Loans
having different Interest Periods, regardless of whether they commence on the
same date, shall be considered separate Loans.

 

(c) Each Lender shall make each Loan that is (A) an ABR Loan or (B) a LIBOR
Loan, to be made by it hereunder on the proposed date thereof by wire transfer
of immediately available funds to the Administrative Agent in New York, New
York, not later than 2:00 p.m., New York City time, and the Administrative Agent
shall by 4:00 p.m., New York City time, credit the amounts so received to the
general deposit account of the Borrower to which such Loan is to be made with
Mellon Bank, N.A., or such other account as such Borrower may designate in a
written notice to the Administrative Agent, or, if such Loans are not made on
such date because any condition precedent to a Borrowing herein specified shall
not have been met, return the amounts so received to the respective Lenders.
Unless the Administrative Agent shall have received notice from a Lender prior
to the time of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s portion of such Borrowing, the Administrative
Agent may assume that such Lender has made such portion available to the
Administrative Agent on the date of such Borrowing in accordance with this
paragraph (c) and the Administrative Agent may, in reliance upon such
assumption, make available to the applicable Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have made
such portion available to the Administrative Agent, such Lender and the
applicable Borrower severally agree to repay to the Administrative Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to such Borrower until
the date such amount is repaid to the Administrative Agent, at (i) in the case
of such Borrower, the interest rate applicable at the time to the Loans
comprising such Borrowing and (ii) in the case of such Lender, a rate determined
by the Administrative Agent to represent its cost of overnight or short-term
funds (which determination shall be conclusive absent manifest error). If such
Lender shall repay to the Administrative Agent such corresponding amount, such
amount shall constitute such Lender’s Loan as part of such Borrowing for
purposes of this Agreement.

 

(d) Notwithstanding any other provision of this Agreement, no Borrower shall be
entitled to request any Borrowing if the Interest Period requested with respect
thereto would end after the Maturity Date.

 

SECTION 2.03. Notice of Borrowings. In order to request a Borrowing, a Borrower
shall give written or telecopy notice (or telephone notice promptly confirmed

 

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in writing or by telecopy) (a) in the case of an ABR Borrowing, to the
Administrative Agent not later than 12:00 noon, New York City time, on the
Business Day of such proposed Borrowing, (b) in the case of a LIBOR Borrowing,
to the Administrative Agent not later than 10:00 a.m., New York City time, three
Business Days before such proposed Borrowing. Such notice shall be irrevocable
and shall in each case refer to this Agreement, identify the applicable Borrower
and specify (i) whether such Borrowing is to be a LIBOR Borrowing or an ABR
Borrowing; (ii) the date of such Borrowing (which shall be a Business Day) and
the amount thereof; and (iii) if such Borrowing is to be a LIBOR Borrowing, the
Interest Period with respect thereto. If no election as to the Type of Borrowing
is specified in any such notice, then the requested Borrowing shall be an ABR
Borrowing. If no Interest Period with respect to any LIBOR Borrowing is
specified in any such notice, then the Borrower giving the notice of Borrowing
shall be deemed to have selected an Interest Period of one month’s duration. The
Administrative Agent shall promptly advise the Lenders of any notice given
pursuant to this Section 2.03 and of each Lender’s portion of the requested
Borrowing.

 

SECTION 2.04. Interest Elections. (a) Each Borrowing initially shall be of the
Type specified in the applicable Borrowing request and, in the case of a LIBOR
Borrowing, shall have an initial Interest Period as specified in such Borrowing
request. Thereafter, the applicable Borrower may elect to convert such Borrowing
to a different Type or to continue such Borrowing in its existing Type and, in
the case of a LIBOR Borrowing, may elect Interest Periods therefor, all as
provided in this Section. The Borrower may elect different options with respect
to different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing.

 

(b) To make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone by the time that a borrowing
request would be required under Section 2.03 if the Borrower were requesting a
Borrowing of the Type resulting from such election to be made on the effective
date of such election. Each such telephonic Interest Election Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Interest Election Request signed by the
Borrower.

 

(c) Each telephonic and written Interest Election Request shall specify the
following information in compliance with Sections 2.02 and 2.03:

 

(i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
the portions thereof to be allocated to each resulting Borrowing (in which case
the information to be specified pursuant to clauses (iii) and (iv) below shall
be specified for each resulting Borrowing);

 

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

 

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(iii) whether the resulting Borrowing is to be an ABR Borrowing or a LIBOR
Borrowing; and

 

(iv) if the resulting Borrowing is a LIBOR Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a period
contemplated by the definition of the term “Interest Period”.

 

If any such Interest Election Request requests a LIBOR Borrowing but does not
specify an Interest Period, then the Borrower shall be deemed to have selected
an Interest Period of one month’s duration.

 

(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender’s portion of each resulting Borrowing.

 

(e) If the Borrower fails to deliver a timely Interest Election Request with
respect to a LIBOR Borrowing prior to the end of the Interest Period applicable
thereto, then, unless such Borrowing is repaid as provided herein, at the end of
such Interest Period such Borrowing shall be converted to an ABR Borrowing.
Notwithstanding any contrary provision hereof, if an Event of Default has
occurred and is continuing and the Administrative Agent, at the request of the
Required Lenders, so notifies the Borrower, then, so long as an Event of Default
is continuing (i) no outstanding Borrowing may be converted to or continued as a
LIBOR Borrowing and (ii) unless repaid, each LIBOR Borrowing shall be converted
to an ABR Borrowing at the end of the Interest Period applicable thereto.

 

SECTION 2.05. Evidence of Debt; Repayment of Loans. (a) The outstanding
principal balance of each Loan shall be payable on the Maturity Date.

 

(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the indebtedness of each Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid such Lender from time to time
under this Agreement.

 

(c) The Administrative Agent shall maintain accounts in which it will record (i)
the amount of each Loan made to a Borrower hereunder, (ii) the Type of each such
Loan and the Interest Period applicable thereto, (iii) the amount of any
principal or interest due and payable or to become due and payable from the
applicable Borrower to each Lender hereunder and (iv) the amount of any sum
received by the Administrative Agent hereunder from any Borrower and each
Lender’s share thereof.

 

(d) The entries made in the accounts maintained pursuant to paragraphs (b) and
(c) above shall be prima facie evidence of the existence and amounts of the
obligations therein recorded; provided, however, that the failure of any Lender
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligation of any Borrower to repay the Loans in
accordance with their terms.

 

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(e) Notwithstanding any other provision of this Agreement, in the event any
Lender shall request a promissory note evidencing the Loans made by it hereunder
to Alcoa or any Borrowing Subsidiary, the Borrower shall deliver such a note,
satisfactory to the Administrative Agent, payable to such Lender or its order,
and the interests represented by such note shall at all times (including after
any assignment of all or part of such interests pursuant to Section 10.04) be
represented by one or more promissory notes payable to the payee named therein
or its order.

 

SECTION 2.06. Fees. (a) Alcoa will pay to each Lender, through the
Administrative Agent, on the last day of March, June, September and December in
each year, and on the date on which the Commitment of such Lender shall be
terminated as provided herein, a facility fee (the “Facility Fee”) at a rate per
annum equal to the Facility Fee Percentage from time to time in effect on the
aggregate amount of the Commitment of such Lender, whether used or unused, from
time to time in effect during the preceding quarter (or shorter period
commencing with the date hereof or ending with the Maturity Date or the date on
which the Commitment of such Lender shall be terminated). All Facility Fees
shall be computed on the basis of the actual number of days elapsed in a year of
360 days. The Facility Fee due to each Lender shall commence to accrue on the
date hereof and shall cease to accrue on the date on which the Commitment of
such Lender shall be terminated as provided herein.

 

(b) Alcoa will pay to the Administrative Agent, for its own account, the fees
payable in the amounts and at the times separately agreed upon between Alcoa and
the Administrative Agent.

 

(c) All fees shall be paid on the dates due, in immediately available funds, to
the Administrative Agent, for distribution, if and as appropriate, among the
Lenders. Once paid, the fees shall not be refundable except in the case of an
error which results in the payment of fees in excess of those due and payable as
of such date, in which case the Administrative Agent shall cause a refund in the
amount of such excess to be paid to Alcoa.

 

SECTION 2.07. Interest on Loans. (a) Subject to the provisions of Section 2.08,
the unpaid principal amount of the Loans comprising each ABR Borrowing shall
bear interest for each day (computed on the basis of the actual number of days
elapsed over a year of 365 or 366 days, as the case may be, when the Alternate
Base Rate is determined by reference to the Prime Rate and over a year of 360
days at all other times) at a rate per annum equal to the Alternate Base Rate.

 

(b) Subject to the provisions of Section 2.08, the unpaid principal amount of
the Loans comprising each LIBOR Borrowing shall bear interest (computed on the
basis of the actual number of days elapsed over a year of 360 days) at a rate
per annum equal to the LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Margin.

 

(c) Interest on each Loan shall be payable on the Interest Payment Dates
applicable to such Loan except as otherwise provided in this Agreement. Interest
shall

 

17

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accrue from and including the first day of an Interest Period to but excluding
the last day of such Interest Period. The applicable LIBO Rate or Alternate Base
Rate for each Interest Period or day within an Interest Period, as the case may
be, shall be determined by the Administrative Agent, and such determination
shall be conclusive absent manifest error.

 

SECTION 2.08. Default Interest. If any Borrower shall default in the payment of
the principal of or interest on any Loan or any other amount becoming due
hereunder, by acceleration or otherwise, such Borrower shall on demand from time
to time pay interest, to the extent permitted by law, on such defaulted amount
up to (but not including) the date of actual payment (after as well as before
judgment) at a rate per annum equal to (a) in the case of overdue principal of
any Loan, the rate otherwise applicable to such Loan as provided in Section 2.07
plus 2% per annum, or (b) in the case of any other amount, the rate applicable
to ABR Borrowings plus 2% per annum.

 

SECTION 2.09. Alternate Rate of Interest. In the event, and on each occasion,
that on the day two Business Days prior to the commencement of any Interest
Period for a LIBOR Loan, the Administrative Agent shall have determined in good
faith that dollar deposits in the principal amounts of the Loans comprising such
Borrowing are not generally available in the London interbank market or other
market in which Lenders ordinarily raise dollars to fund Loans of the requested
Type, or that the rates at which such dollar deposits are being offered will not
adequately and fairly reflect the cost to any Lender of making or maintaining
its LIBOR Loan during such Interest Period, or that reasonable means do not
exist for ascertaining the LIBO Rate, then the Administrative Agent shall, as
soon as practicable thereafter, give written or telecopy notice of such
determination to the relevant Borrower and Lenders. In the event of any such
determination, any request made by a Borrower after the date of such notice for
a LIBOR Borrowing pursuant to Section 2.03 or 2.04 shall, until the
Administrative Agent shall have advised the Borrowers and the Lenders that the
circumstances giving rise to such notice no longer exist, be deemed to be a
request for an ABR Borrowing. Each determination by the Administrative Agent
hereunder shall be conclusive absent manifest error.

 

SECTION 2.10. Termination and Reduction of Commitments. (a) The Commitments
shall be automatically terminated on the Maturity Date.

 

(b) Upon at least 10 Business Days’ prior irrevocable, written or telecopy
notice to the Administrative Agent, Alcoa may at any time in whole permanently
terminate, or from time to time in part permanently reduce, the Total
Commitment; provided, however, that (i) each partial reduction shall be in an
integral multiple of $1,000,000 and in a minimum principal amount of $10,000,000
and (ii) the Total Commitment shall not be reduced to an amount that is less
than the aggregate principal amount of the outstanding Loans (after giving
effect to any simultaneous prepayment pursuant to Section 2.11).

 

(c) Each reduction in Commitments hereunder shall be made ratably among the
Lenders in accordance with each such Lender’s Pro Rata Percentage of the

 

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Total Commitment. Alcoa shall pay to the Administrative Agent for the account of
the applicable Lenders, on the date of each such termination or reduction, the
Facility Fees on the amount of the Commitments so terminated or reduced accrued
to the date of such termination or reduction.

 

SECTION 2.11. Prepayment. (a) Each Borrower shall have the right at any time and
from time to time to prepay any Borrowing, in whole or in part, upon at least
three Business Days’ prior written or telecopy notice (or telephone notice
promptly confirmed by written or telecopy notice) to the Administrative Agent;
provided, however, that each partial prepayment shall be in an amount which is
an integral multiple of $1,000,000 and not less than $10,000,000.

 

(b) On the date of any termination or reduction of any Commitments pursuant to
Section 2.10, the Borrowers shall pay or prepay so much of the Loans, as shall
be necessary in order that, after giving effect to such reduction or
termination, the aggregate principal amount of the outstanding Loans shall not
exceed the Total Commitment.

 

(c) Each notice of prepayment shall specify the prepayment date and the
principal amount of each Loan (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the applicable Borrower to prepay the Loan to which
such notice relates by the amount stated therein on the date stated therein. All
prepayments under this Section 2.11 shall be subject to Section 2.14 but
otherwise without premium or penalty. All prepayments under this Section 2.11
shall be accompanied by accrued interest on the principal amount being prepaid
to the date of payment.

 

SECTION 2.12. Reserve Requirements; Change in Circumstances. (a) Notwithstanding
any other provision herein other than Section 2.14(c), if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender of the
principal of or interest on any LIBOR Loan made by such Lender or any fees or
other amounts payable hereunder (other than changes in respect of taxes imposed
on the overall net income of such Lender by the jurisdiction in which such
Lender has its principal office or by any political subdivision or taxing
authority therein), or shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of or credit extended by such Lender (except any such reserve
requirement which is reflected in the LIBO Rate or the Base CD Rate) or shall
impose on such Lender or the London interbank market or other market in which
Lenders ordinarily raise dollars to fund Loans of the requested Type any other
condition affecting this Agreement or LIBOR Loans made by such Lender, and the
result of any of the foregoing shall be to increase the cost to such Lender of
funding, making or maintaining any LIBOR Loan or to reduce the amount of any sum
received or receivable by such Lender hereunder (whether of principal, interest
or otherwise) by an amount deemed by such Lender to be material, then Alcoa will
pay or cause the other Borrowers to pay to such Lender upon demand such
additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.

 

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(b) If any Lender shall have determined that the applicability of any law, rule,
regulation, agreement or guideline adopted after the date of this Agreement
pursuant to the July 1988 report of the Basle Committee on Banking Regulations
and Supervisory Practices entitled “International Convergence of Capital
Measurement and Capital Standards”, or the adoption after the date hereof of any
other law, rule, regulation, agreement or guideline regarding capital adequacy,
or any change in any of the foregoing or in the interpretation or administration
of any of the foregoing by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Lender (or any lending office of such Lender) or any Lender’s
holding company with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Lender’s capital or on the capital of such Lender’s holding company, if
any, as a consequence of this Agreement or the Loans made by such Lender
pursuant hereto to a level below that which such Lender or such Lender’s holding
company could have achieved but for such applicability, adoption, change or
compliance (taking into consideration such Lender’s policies and the policies of
such Lender’s holding company with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time Alcoa shall pay or
cause the other Borrowers to pay to such Lender such additional amount or
amounts as will compensate such Lender or such Lender’s holding company for any
such reduction suffered.

 

(c) A certificate of each Lender setting forth such amount or amounts as shall
be necessary to compensate such Lender or its holding company as specified in
paragraph (a) or (b) above, as the case may be, together with a statement of
reasons for such demand and showing the calculation for such amounts shall be
delivered to Alcoa and shall be conclusive absent manifest error. Alcoa shall
pay or cause to be paid to each Lender the amount shown as due on any such
certificate delivered by it within 10 days after its receipt of the same.

 

(d) Except as provided in this paragraph, failure on the part of any Lender to
demand compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital with respect to any period shall
not constitute a waiver of such Lender’s right to demand compensation with
respect to such period or any other period. The protection of this Section 2.12
shall be available to each Lender regardless of any possible contention of the
invalidity or inapplicability of the law, rule, regulation, guideline or other
change or condition which shall have occurred or been imposed. No Lender shall
be entitled to compensation under this Section 2.12 for any costs incurred or
reductions suffered with respect to any date unless it shall have notified Alcoa
that it will demand compensation for such costs or reductions under paragraph
(c) above not more than 60 days after the later of (i) such date and (ii) the
date on which it shall have or reasonably should have become aware of such costs
or reductions. In the event a Borrower shall reimburse any Lender pursuant to
this Section 2.12 for any cost and the Lender shall subsequently receive a
refund in respect thereof, the Lender shall so notify such Borrower and shall
pay to such Borrower the portion of such refund which it shall determine in good
faith to be allocable to the cost so reimbursed.

 

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SECTION 2.13. Change in Legality. (a) Notwithstanding any other provision herein
other than Section 2.14(c), 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 LIBOR Loan or to give effect to its obligations as
contemplated hereby with respect to any LIBOR Loan, then, by written or telecopy
notice to Alcoa and the Administrative Agent, such Lender may:

 

(i) declare that LIBOR Loans will not thereafter be made by such Lender
hereunder, whereupon any request by a Borrower for a LIBOR Borrowing shall, as
to such Lender only, be deemed a request for an ABR Loan unless such declaration
shall be subsequently withdrawn; and

 

(ii) require that all outstanding LIBOR Loans made by it be converted to ABR
Loans, in which event all such LIBOR Loans shall automatically be so converted
as of the effective date of such notice as provided in paragraph (b) below.

 

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

 

(b) For purposes of this Section 2.13, a notice by any Lender shall be effective
as to each LIBOR Loan, if lawful, on the last day of the Interest Period
applicable to such LIBOR Loan; in all other cases such notice shall be effective
on the date of receipt.

 

SECTION 2.14. Indemnity. Alcoa shall indemnify or cause the other Borrowers to
indemnify each Lender against any loss or expense which such Lender may sustain
or incur as a consequence of (a) any failure to fulfill on the date of any
Borrowing hereunder the applicable conditions set forth in Article IV, (b) any
failure by a Borrower to borrow any Loan hereunder after irrevocable notice of
such Borrowing has been given pursuant to Section 2.03, (c) any payment or
prepayment of a LIBOR Loan required by any other provision of this Agreement or
otherwise made or deemed made on a date other than the last day of the Interest
Period applicable thereto, other than any loss of profit resulting from any
event, circumstance or condition set forth in Section 2.12 or 2.13, (d) any
default in payment or prepayment of the principal amount of any Loan or any part
thereof or interest accrued thereon, as and when due and payable (at the due
date thereof, whether by scheduled maturity, acceleration, irrevocable notice of
prepayment or otherwise) or (e) the occurrence of any Event of Default,
including, in each such case, any loss or reasonable expense sustained or
incurred or to be sustained or incurred in liquidating or employing deposits
from third parties acquired to effect or maintain such

 

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Loan or any part thereof as a LIBOR Loan. Such loss or reasonable expense shall
include an amount equal to the excess, if any, as reasonably determined by such
Lender, of (i) its cost of obtaining the funds for the Loan being paid, prepaid
or not borrowed (assumed to be the LIBO Rate applicable thereto) for the period
from the date of such payment, prepayment or failure to borrow to the last day
of the Interest Period for such Loan (or, in the case of a failure to borrow the
Interest Period for such Loan which would have commenced on the date of such
failure) over (ii) the amount of interest (as reasonably determined by such
Lender) that would be realized by such Lender in reemploying the funds so paid,
prepaid or not borrowed for such period or Interest Period, as the case may be.
A certificate of any Lender setting forth any amount or amounts which such
Lender is entitled to receive pursuant to this Section together with a statement
of reasons for such demand and the calculation of such amount or amounts shall
be delivered to Alcoa and shall be conclusive absent manifest error.

 

SECTION 2.15. Pro Rata Treatment. Except as required under Section 2.13, each
Borrowing, each payment or prepayment of principal of any Borrowing, each
payment of interest on the Loans, each payment of the Facility Fees, each
reduction of Commitments and each conversion or continuation of any Borrowing
with a Borrowing of any Type shall be allocated pro rata among the Lenders in
accordance with their respective applicable Commitments (or, if such Commitments
shall have expired or been terminated, in accordance with the respective
principal amounts of their applicable outstanding Loans). Each Lender agrees
that in computing such Lender’s portion of any Borrowing to be made hereunder,
the Administrative Agent may, in its discretion, round each Lender’s percentage
of such Borrowing, computed in accordance with Schedule 2.01, to the next higher
or lower whole dollar amount.

 

SECTION 2.16. Sharing of Setoffs. Each Lender agrees that if it shall, through
the exercise of a right of banker’s lien, setoff or counterclaim against any
Borrower, or pursuant to a secured claim under Section 506 of Title 11 of the
United States Code or other security or interest arising from, or in lieu of,
such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means, obtain
payment (voluntary or involuntary) in respect of any Loan or Loans as a result
of which the unpaid principal portion of its Loans shall be proportionately less
than the unpaid principal portion of the Loans of any other Lender, it shall be
deemed simultaneously to have purchased from such other Lender at face value,
and shall promptly pay to such other Lender the purchase price for, a
participation in the Loans of such other Lender, so that the aggregate unpaid
principal amount of the Loans and participations in Loans held by each Lender
shall be in the same proportion to the aggregate unpaid principal amount of all
Loans then outstanding as the principal amount of its Loans prior to such
exercise of banker’s lien, setoff or counterclaim or other event was to the
principal amount of all Loans outstanding prior to such exercise of banker’s
lien, setoff or counterclaim or other event; provided, however, that, if any
such purchase or purchases or adjustments shall be made pursuant to this Section
and the payment giving rise thereto shall thereafter be recovered, such purchase
or purchases or adjustments shall be rescinded to the extent of such recovery
and the purchase price or prices or adjustment restored without interest. Alcoa
and each other Borrower expressly consent to the foregoing arrangements and
agree that any Lender

 

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holding a participation in a Loan deemed to have been so purchased may exercise
any and all rights of banker’s lien, setoff or counterclaim with respect to any
and all moneys owing by Alcoa or such other Borrower to such Lender by reason
thereof as fully as if such Lender had made a Loan directly to Alcoa or such
Borrower in the amount of such participation.

 

SECTION 2.17. Payments. (a) Each payment or prepayment by any Borrower of the
principal of or interest on any Loans, any fees payable to the Administrative
Agent or the Lenders or any other amounts due hereunder (other than amounts
referred to in clause (b) below) shall be made, without setoff or counterclaim,
not later than 12:00 (noon), New York City time, on the date when due in dollars
to the Administrative Agent at its offices at 270 Park Avenue, New York, New
York, in immediately available funds.

 

(b) Whenever any payment (including principal of or interest on any Borrowing or
any fees or other amounts) hereunder shall become due, or otherwise would occur,
on a day that is not a Business Day, such payment may be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of interest or fees, if applicable.

 

SECTION 2.18. Taxes. (a) Any and all payments by or on behalf of a Borrower
hereunder shall be made 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 imposed on the net
income of the Administrative Agent or any Lender (or any transferee or assignee
thereof, including a participation holder (any such entity a “Transferee”)) and
franchise taxes imposed on the Administrative Agent or any Lender (or
Transferee) in each case by the United States or any jurisdiction under the laws
of which the Administrative Agent or any such Lender (or Transferee) is
organized or any political subdivision thereof (all such nonexcluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities, collectively
or individually, “Taxes”). If any Borrower shall be required by law to deduct
any Taxes from or in respect of any sum payable hereunder to the Lenders (or any
Transferee) or the Administrative Agent, (i) the sum payable shall be increased
by the amount necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 2.18) such
Lender (or Transferee) or the Administrative Agent (as the case may be) shall
receive an amount equal to the sum it would have received had no such deductions
been made, (ii) such Borrower shall make such deductions and (iii) such Borrower
shall pay the full amount deducted to the relevant taxing authority or other
Governmental Authority in accordance with applicable law; provided, however,
that no Transferee of any Lender shall be entitled to receive any greater
payment under this paragraph (a) than such Lender would have been entitled to
receive immediately before assignment, participation or other transfer with
respect to the rights assigned, participated or transferred unless such
assignment, participation or transfer shall have been made (A) prior to the
occurrence of an event (including any change in treaty, law or regulation)
giving rise to such greater payment or (B) at the request of Alcoa.

 

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(b) In addition, each Borrower agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement
(hereinafter referred to as “Other Taxes”).

 

(c) Each Borrower will indemnify each Lender (or Transferee) and the
Administrative Agent for the full amount of Taxes and Other Taxes paid by such
Lender (or Transferee) or the Administrative Agent, as the case may be, and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted by the relevant taxing authority or other Governmental
Authority. Such indemnification shall be made within 30 days after the date any
Lender (or Transferee) or the Administrative Agent, as the case may be, makes
written demand therefor, together with a statement of reasons for such demand
and the calculations of such amount.

 

(d) Within 30 days after the date of any payment of Taxes or Other Taxes
withheld by any Borrower in respect of any payment to any Lender (or Transferee)
or the Administrative Agent, such Borrower will furnish to the Administrative
Agent, at its address referred to in Section 10.01, the original or a certified
copy of a receipt evidencing payment thereof.

 

(e) Without prejudice to the survival of any other agreement contained herein,
the agreements and obligations contained in this Section 2.18 shall survive the
payment in full of the principal of and interest on all Loans made hereunder.

 

(f) Each Lender (or Transferee) represents to Alcoa that, on the date such
Lender (or such Transferee) becomes a party to this Agreement, it is eligible to
receive payments of interest hereunder from Alcoa or any Borrowing Subsidiary
without withholding in respect of United States Federal withholding tax (except,
in the case of a Transferee of any Lender, as a result of the occurrence of an
event (including a change in treaty, law or regulation) after the date of this
Agreement giving rise to withholding to which such Lender would be subject).

 

(g) Each Lender (or Transferee, other than a Transferee described in the
exception in Section 2.18(f)) that is organized under the laws of a jurisdiction
outside the United States shall, on or before the date it becomes a party to
this Agreement (or, in the case of a Transferee that is a participation holder,
on or before the date such Transferee becomes a participation holder hereunder),
deliver to Alcoa and the Administrative Agent such certificates, documents or
other evidence, as required by the Code or Treasury Regulations issued pursuant
thereto, including Internal Revenue Service Form W8-BEN, Form W-8ECI, or any
other certificate or statement of exemption required by Treasury Regulation
Section 1.1441-1, 1.1441-4 or 1.1441-6(c) or any subsequent version thereof or
successors thereto, properly completed and duly executed by such Lender (or
Transferee) establishing that payment is (i) not subject to United States
Federal withholding tax under the Code because such payments are effectively
connected with the conduct by such Lender (or Transferee) of a trade or business
in the United States or

 

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(ii) totally exempt from United States Federal withholding tax under a provision
of an applicable tax treaty. In addition, each such Lender (or such Transferee)
shall, if legally able to do so, thereafter deliver such certificates, documents
or other evidence from time to time establishing that payments received
hereunder are not subject to such withholding upon receipt of a written request
therefor from Alcoa or the Administrative Agent. Unless Alcoa and the
Administrative Agent have received forms or other documents satisfactory to them
indicating that payments hereunder are not subject to United States Federal
withholding tax, Alcoa or the Administrative Agent shall withhold such taxes
from such payments at the applicable statutory rate, subject to Section 2.18(a).

 

(h) None of the Borrowers shall be required to pay any additional amounts to any
Lender (or Transferee) in respect of United States Federal withholding tax
pursuant to paragraph (a) above to the extent that the obligation to pay such
additional amounts would not have arisen but for a failure by such Lender (or
Transferee) to deliver the certificates, documents or other evidence required to
be delivered under the preceding paragraph (g) unless such failure is
attributable to (i) a change in applicable law, regulation or official
interpretation thereof or (ii) an amendment or modification to or a revocation
of any applicable tax treaty or a change in official position regarding the
application or interpretation thereof, in each case on or after the date such
Lender (or Transferee) became a party to this Agreement.

 

(i) Any Lender (or Transferee) claiming any additional amounts payable pursuant
to this Section 2.18 shall use reasonable efforts (consistent with legal and
regulatory restrictions) to file any certificate or document requested in
writing by the relevant Borrower or to change the jurisdiction of its applicable
lending office if the making of such a filing or change would avoid the need for
or reduce the amount of any such additional amounts which may thereafter accrue
and would not, in the sole determination of such Lender (or Transferee), be
otherwise disadvantageous to such Lender (or Transferee).

 

(j) If a Lender (or Transferee) or the Administrative Agent shall become aware
that it may be entitled to receive a refund in respect of Taxes or Other Taxes
as to which it has been indemnified by a Borrower pursuant to this Section 2.18,
it shall promptly notify Alcoa of the availability of such refund and shall,
within 30 days after receipt of a request by Alcoa, apply for such refund at
Alcoa’s expense. If any Lender (or Transferee) or the Administrative Agent
receives a refund in respect of any Taxes or Other Taxes as to which it has been
indemnified by a Borrower pursuant to this Section 2.18, it shall promptly repay
such refund to such Borrower (to the extent of amounts that have been paid by
such Borrower under this Section 2.18 with respect to such refund), net of all
out-of-pocket expenses (including taxes imposed with respect to such refund) of
such Lender (or Transferee) or the Administrative Agent and without interest;
provided, however, that such Borrower, upon the request of such Lender (or
Transferee) or the Administrative Agent, agrees to return such refund (plus
penalties, interest or other charges) to such Lender (or Transferee) or the
Administrative Agent in the event such Lender (or Transferee) or the
Administrative Agent is required to repay such refund.

 

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(k) Nothing contained in this Section 2.18 shall require any Lender (or
Transferee) or the Administrative Agent to make available any of its tax returns
(or any other information relating to its taxes which it deems to be
confidential).

 

(l) No Borrower shall be required to reimburse any Lender (or Transferee) or the
Administrative Agent with respect to any Tax or Other Tax unless such Lender,
Transferee or the Administrative Agent notifies such Borrower of the amount of
such Tax or Other Tax on or before the second anniversary of the date such
Lender, Transferee or the Administrative Agent pays such Tax or Other Tax.

 

SECTION 2.19. Assignment of Commitments Under Certain Circumstances. In the
event that any Lender shall have delivered a notice or certificate pursuant to
Section 2.12 or 2.13, or a Borrower shall be required to make additional
payments to any Lender under Section 2.18, Alcoa shall have the right, at its
own expense, upon notice to such Lender and the Administrative Agent, to require
such Lender to transfer and assign without recourse (in accordance with and
subject to the restrictions contained in Section 10.04) all its interests,
rights and obligations under this Agreement to another financial institution
which shall assume such obligations; provided, however, that (i) no such
assignment shall conflict with any law, rule or regulation or order of any
Governmental Authority and (ii) Alcoa or the assignee, as the case may be, shall
pay (or, in the case of Alcoa, cause another Borrower to pay) to the affected
Lender in immediately available funds on the date of such termination or
assignment the principal of and interest accrued to the date of payment on the
Loans made by it hereunder and all other amounts accrued for its account or owed
to it hereunder.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

 

Each Borrower represents and warrants to each of the Lenders with respect to
itself as follows (except that the Borrowing Subsidiaries make no
representations or warranties under Section 3.06 or 3.09):

 

SECTION 3.01. Organization. Such Borrower is a corporation duly organized,
validly existing and, where applicable, in good standing under the laws of its
jurisdiction of incorporation and is duly qualified to do business as a foreign
corporation and, where applicable, is in good standing in all other
jurisdictions in which the ownership of its properties or the nature of its
activities or both makes such qualification necessary, except to the extent that
failure to be so qualified would not result in a Material Adverse Effect.

 

SECTION 3.02. Authorization. Such Borrower has corporate power and authority to
execute, deliver and carry out the provisions of this Agreement to which it is a
party, to borrow hereunder and to perform its obligations hereunder and all such
action has been duly and validly authorized by all necessary corporate
proceedings on its part.

 

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SECTION 3.03. Enforceability. This Agreement has been duly executed and
delivered by such Borrower and constitutes the legal, valid and binding
obligation of such Borrower enforceable in accordance to its terms, except as
limited by bankruptcy, insolvency or other similar laws of general application
affecting the enforcement of creditors’ rights or by general principles of
equity limiting the availability of equitable remedies.

 

SECTION 3.04. Governmental Approvals. No authorization, consent, approval,
license, exemption or other action by, and no registration, qualification,
designation, declaration or filing with, any Governmental Authority is necessary
in connection with such Borrower’s execution and delivery of this Agreement, the
consummation by any Borrower of the transactions contemplated hereby or such
Borrower’s performance of or compliance with the terms and conditions hereof,
except as set forth on Schedule 3.04.

 

SECTION 3.05. No Conflict. None of the execution and delivery by such Borrower
of this Agreement, the consummation by such Borrower of the transactions
contemplated hereby or performance by such Borrower of or compliance by such
Borrower with the terms and conditions hereof or thereof will (a) violate any
law, constitution, statute, treaty, regulation, rule, ordinance, order,
injunction, writ, decree or award of any Governmental Authority to which it is
subject, (b) conflict with or result in a breach or default under its charter or
Memorandum and Articles of Association or by-laws, as applicable, (c) conflict
with or result in a breach or default which is material in the context of this
Agreement under any agreement or instrument to which such Borrower is a party or
by which it or any of its properties, whether now owned or hereafter acquired,
may be subject or bound or (d) result in the creation or imposition of any Lien
prohibited by Section 6.01 upon any property or assets, whether now owned or
hereafter acquired, of such Borrower.

 

SECTION 3.06. Financial Statements. In the case of Alcoa, it has furnished to
the Lenders copies of its consolidated balance sheet as of December 31, 2002 and
2003, and the related consolidated statements of income and shareholders’ equity
and cash flows for the three years ended December 31, 2003, all audited by
PricewaterhouseCoopers LLP. Such financial statements (including the notes
thereto) present fairly the financial condition of Alcoa and its Subsidiaries as
of such dates and the results of their operations and cash flows for the periods
then ended, all in conformity with GAAP.

 

SECTION 3.07. No Defaults. No event has occurred and is continuing and no
condition exists which constitutes a Default or Event of Default hereunder. Such
Borrower is not in violation of (i) any term of its charter or Constitution or
by-laws, as applicable, or (ii) any material agreement or instrument to which it
is a party or by which it or any of its properties may be subject or bound where
such violation is likely to result in a Material Adverse Effect.

 

SECTION 3.08. Litigation. Except as set forth in the financial statements
referred to in Section 3.06 or the Exchange Act Report or otherwise disclosed on

 

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Schedule 3.08, there is no pending or, to the knowledge of any of its
Responsible Officers, threatened proceeding by or before any Governmental
Authority against it which in the opinion of its counsel is likely to result in
a Material Adverse Effect. Except as set forth in the financial statements
referred to in Section 3.06 or the Exchange Act Report or otherwise disclosed in
Schedule 3.08, there is no pending or, to the knowledge of any of its
Responsible Officers, threatened proceeding by or before any Governmental
Authority against any of its Subsidiaries which in the opinion of its counsel is
likely to result in a Material Adverse Effect.

 

SECTION 3.09. No Material Adverse Change. As of the date of this Agreement,
there has been no material adverse change in the business, assets, operations or
financial condition of itself and its Subsidiaries, taken as a whole except, in
the case of Alcoa and the Borrowing Subsidiaries, as disclosed in the Exchange
Act Report since December 31, 2003.

 

SECTION 3.10. Employee Benefit Plans. (a) U.S. Plans. It and each of its ERISA
Affiliates is in compliance in all material respects with the applicable
provisions of ERISA and the regulations and published interpretations
thereunder. No Reportable Event has occurred as to which such Borrower or any
ERISA Affiliate was required to file a report with the PBGC that alone or
together with any other Reportable Event would reasonably be expected to result
in a liability of such Borrower to the PBGC in an aggregate amount in excess of
$25,000,000. The aggregate present value of all benefit liabilities under the
Plans (based on the assumptions used to fund such Plans) did not, as of the last
annual valuation dates applicable thereto, exceed the aggregate value of the
assets of the Plans by more than 10% of Consolidated Net Worth. Neither such
Borrower nor any ERISA Affiliate has incurred any Withdrawal Liability that
would reasonably be expected to result in a Material Adverse Effect. Neither
such Borrower nor any ERISA Affiliate has received any notification that any
Multiemployer Plan is in reorganization or has been terminated within the
meaning of Title IV of ERISA, and no Responsible Officer of any Borrower has
knowledge of any fact which would reasonably be expected to result in the
reorganization or termination of a Multiemployer Plan where such reorganization
or termination has resulted or would reasonably be expected to result, through
increases in the contributions required to be made to such Plan or otherwise, in
a Material Adverse Effect.

 

(b) Foreign Plans. Each Foreign Plan is in compliance in all material respects
with all requirements of law applicable thereto and the respective requirements
of the governing documents for such plan except to the extent such
non-compliance could not reasonably be expected to result in a Material Adverse
Effect. With respect to each Foreign Pension Plan, none of the Borrowers, their
respective Affiliates or any of their directors, officers, employees or agents
has engaged in a transaction which would subject any of the Borrowers, directly
or indirectly, to a material tax or civil penalty which could reasonably be
expected to result in a Material Adverse Effect. With respect to each Foreign
Pension Plan, none of the Borrowers, their respective Affiliates or any of their
directors, officers, employees or agents has engaged in a transaction which
would subject any of the Borrowers, directly or indirectly, to a material tax or
civil penalty which could reasonably be expected to result in a Material Adverse
Effect. With respect to each

 

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Foreign Plan, adequate reserves have been established in the financial
statements furnished to Lenders in respect of any unfunded liabilities in
accordance with applicable law and prudent business practice or, where required,
in accordance with ordinary accounting practices in the jurisdiction in which
such Foreign Plan is maintained. The aggregate unfunded liabilities, after
giving effect to any such reserves for such liabilities, with respect to such
Foreign Plans could not reasonably be expected to result in a Material Adverse
Effect. There are no material actions, suits or claims (other than routine
claims for benefits) pending or threatened against any of the Borrowers or any
of their Affiliates with respect to any Foreign Plan which could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect.

 

SECTION 3.11. Title to Properties; Possession Under Leases. (a) Such Borrower
and each of its Subsidiaries have good and marketable title to, or valid
leasehold interests in, all its material properties and assets, except for minor
defects in title that do not materially interfere with its ability to conduct
its business as currently conducted or to utilize such properties and assets for
their intended purposes.

 

(b) Such Borrower and each of its Subsidiaries have complied with all material
obligations under all material leases to which it is a party and all such leases
are in full force and effect. Such Borrower and its Subsidiaries enjoy peaceful
and undisturbed possession under all such material leases.

 

SECTION 3.12. Investment Company Act; Public Utility Holding Company Act. None
of Alcoa or any Borrowing Subsidiary is an “investment company” as defined in,
or subject to regulation under, the Investment Company Act of 1940. Alcoa is
exempted as, and no Borrowing Subsidiary is, a “holding company” as defined in,
or subject to regulation under, the Public Utility Holding Company Act of 1935.

 

SECTION 3.13. Tax Returns. Such Borrower and its Subsidiaries have filed or
caused to be filed all Federal, state, local and foreign tax returns required to
have been filed by it and have paid or caused to be paid all taxes shown to be
due and payable on such returns or on any assessments received by it, except
taxes that are being contested in good faith by appropriate proceedings and for
which adequate reserves are maintained in accordance with GAAP.

 

SECTION 3.14. Compliance with Laws and Agreements. (a) Neither such Borrower nor
any of its Subsidiaries is in violation of any law, rule or regulation, or in
default with respect to any judgment, writ, injunction or decree of any
Governmental Authority, where such violation or default would reasonably be
expected to result in a Material Adverse Effect.

 

(b) Neither such Borrower nor any of its Subsidiaries is in default in any
material manner under any provision of any indenture or other agreement or
instrument evidencing Indebtedness, or any other material agreement or
instrument to which it is a party or by which it or any of its properties or
assets are or may be bound, where such default would be reasonably likely to
result in a Material Adverse Effect.

 

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SECTION 3.15. No Material Misstatements. Except for information not prepared by
Alcoa and expressly disclaimed thereby, no report, financial statement, exhibit
or schedule furnished by or on behalf of such Borrower to the Administrative
Agent or any Lender in connection with the negotiation of this Agreement or
included herein or delivered pursuant thereto contained or contains any material
misstatement of fact or omitted or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were or are made, not misleading.

 

SECTION 3.16. Federal Reserve Regulations. The proceeds of any Loan will be used
to provide working capital or for other general corporate purposes, including
but not limited to the support of Alcoa’s Commercial Paper program. No part of
the proceeds of any Loan to such Borrower will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, for any purpose
that entails a violation of any of the Regulations of the Board, including
Regulations U and X.

 

SECTION 3.17. No Trusts. Such Borrower is not entering into this Agreement in
its capacity as trustee of any trust.

 

ARTICLE IV

 

CONDITIONS OF EFFECTIVENESS,

LENDING AND DESIGNATION OF BORROWING SUBSIDIARIES

 

The obligations of the Lenders to make Loans to any Borrower hereunder are
subject to the satisfaction of the conditions set forth in Sections 4.01 and
4.02 below (and, in the case of Loans to any Borrowing Subsidiary, the
satisfaction, as to such Borrowing Subsidiary, of the conditions set forth in
Section 4.03 below):

 

SECTION 4.01. Effective Date. On the Effective Date:

 

(a) The Administrative Agent shall have received a written opinion of Thomas F.
Seligson, Counsel of Alcoa, dated the Effective Date and addressed to the
Lenders, to the effect set forth in Exhibit C hereto.

 

(b) All legal matters incident to this Agreement and the borrowings hereunder
shall be satisfactory to the Lenders and to Cravath, Swaine & Moore LLP, counsel
for the Administrative Agent.

 

(c) The Administrative Agent shall have received (i) a copy, including all
amendments thereto, of the charter of Alcoa, certified as of a recent date by
the Secretary of State or other appropriate official of its jurisdiction of
incorporation and a certificate as to the good standing of Alcoa as of a recent
date, from such Secretary of State or other official; (ii) a certificate of the
Secretary or Assistant Secretary of Alcoa dated the Effective Date and
certifying (A) that attached thereto is a true and complete copy of the by-laws
of such corporation as in effect on the Effective Date showing all amendments
thereto since the date of the resolutions described in clause (B) below, (B)
that attached thereto is a true and complete copy of resolutions duly adopted by
the Board of Directors

 

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of such corporation authorizing the execution, delivery and performance of this
Agreement and the borrowings by such corporation hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full force
and effect, (C) that the charter of Alcoa has not been amended since the date of
the last amendment thereto shown on the certificate of good standing furnished
pursuant to clause (i) above and (D) as to the incumbency and specimen signature
of each officer executing this Agreement or any other document delivered in
connection herewith on behalf of such corporation; (iii) a certificate of
another officer of each such corporation as to the incumbency and specimen
signature of the Secretary or Assistant Secretary executing the certificate
pursuant to (ii) above; and (iv) such other documents as the Lenders or Cravath,
Swaine & Moore LLP, counsel for the Administrative Agent may reasonably request.

 

(d) No loans shall be outstanding under the Existing 364-Day Credit Agreement or
the 2001 Five-Year Credit Agreement and the commitments under both such
Agreements shall have been terminated.

 

(e) The Administrative Agent shall have received certificates dated the
Effective Date and signed by a Financial Officer of Alcoa confirming the
satisfaction of the conditions precedent set forth in paragraph (d) of this
Section 4.01 and paragraph (b) and paragraph (c) of Section 4.02.

 

(f) The Administrative Agent shall have received all fees and other amounts due
and payable on or prior to the Effective Date, including all fees accrued to the
date hereof under both the Existing 364-Day Credit Agreement and the 2001
Five-Year Credit Agreement.

 

(g) The Administrative Agent shall have received certificates of a Responsible
Officer of Alcoa, each dated the Effective Date and stating that (i) except as
disclosed in the Exchange Act Report or otherwise disclosed in such certificate,
Alcoa and each of its Subsidiaries have complied in all respects with all
Federal, state, local and foreign statutes, ordinances, orders, judgments,
rulings and regulations relating to environmental pollution or to environmental
regulation or control except to the extent any such failure so to comply would
not, alone or together with any other such failure, be reasonably likely to
result in a Material Adverse Effect; (ii) neither Alcoa nor any of its
Subsidiaries has received notice of any failure so to comply which alone or
together with any other such failure would be reasonably likely to result in a
Material Adverse Effect; and (iii) the plants of Alcoa and its Subsidiaries do
not manage any hazardous wastes, toxic pollutants or substances similarly
denominated in violation of any applicable law or regulations promulgated
pursuant thereto including, for operations within the United States, the
Resource Conservation and Recovery Act, the Comprehensive Environmental Response
Compensation and Liability Act, the Hazardous Materials Transportation Act, the
Toxic Substance Control Act, the Clean Air Act, the Clean Water Act or any other
applicable law, where such violation would be reasonably likely to result,
individually or together with any such other violations, in a Material Adverse
Effect.

 

SECTION 4.02. All Borrowings. On the date of each Borrowing:

 

(a) Such Borrower shall have provided the notice as required by Section 2.03.

 

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(b) The representations and warranties set forth in Article III hereof shall be
true and correct in all material respects on and as of the date of such
Borrowing with the same effect as though made on and as of such date, except to
the extent such representations and warranties expressly relate to an earlier
date.

 

(c) Each Borrower shall be in compliance in all material respects with all the
terms and provisions set forth herein on its part to be observed or performed,
and at the time of and immediately after such Borrowing no Event of Default or
Default shall have occurred and be continuing.

 

(d) In the case of any Borrowing which would cause the aggregate principal
amount of outstanding loans under this Agreement, the 2003 Five-Year Credit
Agreement, the 364-Day Credit Agreement and any other Facilities (as defined in
the resolutions duly adopted by the Board of Directors of Alcoa on November 9,
2001) to exceed $10,000,000,000, such Borrowing shall have been duly authorized
by Alcoa and the Administrative Agent shall have received a true and complete
copy of resolutions duly adopted by the Board of Directors of Alcoa authorizing
such Borrowing.

 

Each Borrowing by any Borrower shall be deemed to constitute a representation
and warranty by such Borrower and, in the case of a Borrowing Subsidiary, Alcoa
on the date of such Borrowing as to the matters specified in paragraphs (b), (c)
and (d) of this Section 4.02. Notwithstanding any contrary provision hereof, a
conversion of a Borrowing to a different Type or a continuation of a Borrowing
in its existing Type shall not be considered a new Borrowing.

 

SECTION 4.03. Designation of Borrowing Subsidiaries. On each Designation Date:

 

(a) The Administrative Agent shall have received (i) a copy of the charter,
including all amendments thereto, of each applicable Borrowing Subsidiary,
certified as of a recent date by the Secretary of State or the appropriate
foreign governmental official of the state or country of its organization, and a
certificate as to the good standing of such Borrowing Subsidiary as of a recent
date from such Secretary of State or appropriate foreign governmental official,
as applicable; (ii) a certificate of the Secretary or Assistant Secretary of
such Borrowing Subsidiary dated the Designation Date and certifying (A) that
attached thereto is a true and completed copy of the by-laws of such Borrowing
Subsidiary as in effect on the Designation Date showing all amendments thereto
since the date of the resolutions described in clause (B) below, (B) that
attached thereto is a true and complete copy of resolutions duly adopted by the
Board of Directors of such Borrowing Subsidiary authorizing the execution,
delivery and performance of this Agreement and the borrowings hereunder, and
that such resolutions have not been modified, rescinded or amended and are in
full force and effect, (C) that the charter of such Borrowing Subsidiary has not
been amended since the date of the last amendment thereto shown on the
certificate of good standing furnished pursuant to clause (i) above,

 

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and (D) as to the incumbency and specimen signature of each officer executing or
any other document delivered in connection herewith on behalf of such Borrowing
Subsidiary; and (iii) a certificate of another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary executing the
certificate pursuant to (ii) above.

 

(b) The Administrative Agent shall have received a Designation of Borrowing
Subsidiary of each applicable Borrowing Subsidiary as provided in Section
10.04(e).

 

ARTICLE V

 

AFFIRMATIVE COVENANTS

 

So long as this Agreement shall remain in effect or the principal of or interest
on any Loan, any fees or any other expenses or amounts payable in connection
herewith shall be unpaid, unless the Required Lenders shall otherwise consent in
writing:

 

SECTION 5.01. Financial Statements, Reports, etc. Alcoa shall furnish to the
Administrative Agent the following, with sufficient copies for the
Administrative Agent to provide a copy to each Lender:

 

(a) within 120 days after the end of each fiscal year, (i) its consolidated
balance sheet and related statements of income and cash flow audited by
independent public accountants of recognized national standing, accompanied by
an opinion of such accountants (which shall not be qualified as to scope of
audit or in any manner calling into question the status of its business as a
going concern) to the effect that such consolidated financial statements fairly
present its financial condition and results of operations and that of its
consolidated Subsidiaries, taken as a whole, in accordance with GAAP and (ii)
the balance sheet and related statements of income of each of its Subsidiaries
which has been designated pursuant to Section 10.04(e) as, and as long as such
Subsidiary remains, a Borrowing Subsidiary, certified by a Financial Officer of
such Subsidiary;

 

(b) within 60 days after the end of each of the first three fiscal quarters of
each fiscal year, its Form 10-Q as prescribed by the Securities and Exchange
Commission (or any successor agency);

 

(c) no later than the delivery due date of financial statements under (a) above
and promptly at the request of the Administrative Agent (but not more often than
once with respect to any fiscal quarter), a certificate of a Financial Officer
(i) certifying that no Event of Default or Default has occurred and is
continuing or, if such an Event of Default or Default has occurred and is
continuing, specifying the nature and extent thereof and any corrective action
taken or proposed to be taken with respect thereto and (ii) setting forth
computations in reasonable detail satisfactory to the Administrative Agent
demonstrating compliance with the covenant contained in Section 6.03;

 

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(d) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by it (other than
registration statements and prospectuses related to offerings to directors,
officers or employees) with the Securities and Exchange Commission or any
Governmental Authority succeeding to any of or all the functions of such
Commission, or with any national securities exchange, or distributed to its
shareholders, as the case may be; and

 

(e) promptly, from time to time, such other information regarding its
operations, business affairs and financial condition, or compliance with the
terms of this Agreement, as the Administrative Agent or any Lender may
reasonably request.

 

Information required to be delivered pursuant to this Section 5.01 shall be
deemed to have been delivered if such information, or one or more annual or
quarterly reports containing such information, shall have been posted by the
Administrative Agent on an IntraLinks or similar site to which the Lenders have
been granted access (and a confirming electronic correspondence is delivered or
caused to be delivered by the Administrative Agent to such addresses as a Lender
may designate for this purpose providing notice of such posting) or shall be
available on the website of the Securities and Exchange Commission at
http://www.sec.gov (and a confirming electronic correspondence is delivered or
caused to be delivered by Alcoa to the Administrative Agent providing notice of
such availability); provided that Alcoa shall deliver paper copies of such
information to any Lender that requests such delivery. Information required to
be delivered pursuant to this Section 5.01 may also be delivered by electronic
communications pursuant to procedures approved by the Administrative Agent.

 

SECTION 5.02. Pari Passu Ranking. Each Borrower shall ensure that any amounts
payable by it hereunder will at all times rank at least pari passu with all
other unsecured, unsubordinated Indebtedness of such Borrower except to the
extent any such Indebtedness may be preferred by law.

 

SECTION 5.03. Maintenance of Properties. Each Borrower shall, and shall cause
its Subsidiaries to, maintain and keep its properties in such repair, working
order and condition, and make or cause to be made all such needful and proper
repairs, renewals and replacements thereto, as in the judgment of such Borrower
are necessary and in the interests of such Borrower; provided, however, that
nothing in this Section 5.03 shall prevent such Borrower (or any Subsidiary
thereof) from selling, abandoning or otherwise disposing of any of its
respective properties or discontinuing a part of its respective businesses from
time to time if, in the judgment of such Borrower, such sale, abandonment,
disposition or discontinuance is advisable.

 

SECTION 5.04. Obligations and Taxes. Each Borrower shall pay its Indebtedness
and other obligations that, if not paid, would result in a Material Adverse
Effect before the same shall become delinquent or in default, and pay and
discharge all taxes upon or against it, or against its properties, in each case
prior to the date on which penalties attach thereto, unless and to the extent
that any such obligation or tax is being contested in good faith and adequate
reserves with respect thereto are maintained in accordance with GAAP.

 

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SECTION 5.05. Insurance. Each Borrower shall, and shall cause its consolidated
Subsidiaries to, insure and keep insured, in each case with reputable insurance
companies, so much of its respective properties to such an extent and against
such risks, or in lieu thereof, in the case of any Borrower, maintain or cause
to be maintained a system or systems of self-insurance, as is customary in the
case of corporations engaged in the same or similar business or having similar
properties similarly situated.

 

SECTION 5.06. Existence; Businesses and Properties. (a) Each Borrower shall do
or cause to be done all things necessary to preserve, renew and keep in full
force and effect its legal existence in its jurisdiction of incorporation,
except as otherwise expressly permitted under Section 6.02.

 

(b) Each Borrower shall do or cause to be done all things necessary to obtain,
preserve, renew, extend and keep in full force and effect the rights, licenses,
permits, franchises, authorizations, patents, copyrights, trademarks and trade
names material to the conduct of its business as its Board of Directors shall
determine in its judgment.

 

SECTION 5.07. Compliance with Laws. (a) Each Borrower shall comply in all
material respects with all applicable laws, rules, regulations and orders of any
Governmental Authority to which it is subject, whether now in effect or
hereafter enacted, such that no failure so to comply will result in the levy of
any penalty or fine which shall have a Material Adverse Effect.

 

(b) Each Borrower shall comply in all material respects with the applicable
provisions of ERISA and all other related applicable laws and furnish to the
Administrative Agent and each Lender (i) as soon as possible, and in any event
within 30 days after any Responsible Officer of such Borrower or any ERISA
Affiliate either knows or has reason to know that any ERISA Event has occurred
that alone or together with any other ERISA Event would reasonably be expected
to result in liability of such Borrower to the PBGC in an aggregate amount
exceeding $25,000,000, a statement of a Financial Officer setting forth details
as to such ERISA Event and the action proposed to be taken with respect thereto,
together with a copy of the notice, if any, of such ERISA Event given to the
PBGC or other Governmental Authority, (ii) promptly after receipt thereof, a
copy of any notice such Borrower or any ERISA Affiliate may receive from the
PBGC or other Governmental Authority relating to the intention of the PBGC or
other Governmental Authority to terminate any Plan or Plans (other than a Plan
maintained by an ERISA Affiliate which is considered an ERISA Affiliate only
pursuant to subsection (m) or (o) of Section 414 of the Code), or any Foreign
Plan or Foreign Plans, or to appoint a trustee to administer any Plan or Plans,
or any Foreign Plan or Foreign Plans, (iii) within 10 days after the due date
for filing with the PBGC pursuant to Section 412(n) of the Code of a notice of
failure to make a required installment or other payment with respect to a Plan,
a statement of a Financial Officer setting forth details as to such failure and
the action proposed to be taken with respect thereto, together with a copy of
such notice given to the PBGC and (iv) promptly and in any event within 30 days
after receipt thereof by such Borrower or any ERISA Affiliate from the sponsor
of a

 

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Multiemployer Plan, a copy of each notice received by such Borrower or ERISA
Affiliate concerning (A) the imposition of Withdrawal Liability in excess of
$25,000,000 or (B) a determination that a Multiemployer Plan is, or is expected
to be, terminated or in reorganization, in each case within the meaning of Title
IV of ERISA, if such termination or reorganization would reasonably be expected
to result, alone or with any other such termination or reorganization, in
increases in excess of $25,000,000 in the contributions required to be made to
the relevant Plan or Plans.

 

SECTION 5.08. Litigation and Other Notices. Each Borrower shall furnish to the
Administrative Agent prompt written notice upon its becoming aware of any of the
following:

 

(a) any Event of Default or Default, specifying the nature and extent thereof
and the corrective action (if any) proposed to be taken with respect thereto;

 

(b) the filing or commencement of, or any threat or notice of intention of any
person to file or commence, any action, suit or proceeding, whether at law or in
equity or by or before any Governmental Authority, against it or any of its
Subsidiaries which would reasonably be expected to result in a Material Adverse
Effect; and

 

(c) any other development that has resulted in, or would reasonably be expected
to result in, a Material Adverse Effect.

 

SECTION 5.09. Borrowing Subsidiaries. Alcoa shall cause each Borrowing
Subsidiary at all times to be a wholly-owned Subsidiary.

 

ARTICLE VI

 

NEGATIVE COVENANTS

 

Each Borrower covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect or the principal of or interest on any Loan,
any fees or any other expenses or amounts payable in connection herewith shall
be unpaid, unless the Required Lenders shall otherwise consent in writing, such
Borrower will not:

 

SECTION 6.01. Liens. (a) Create or incur, or permit any Restricted Subsidiary to
create or incur, any Lien on its property or assets (including stock or other
securities of any person, including any of its Subsidiaries) now or hereafter
acquired by it or on any income or revenues or rights in respect thereof,
securing Indebtedness for borrowed money, without ratably securing the Loans;
provided, however, that the foregoing shall not apply to the following:

 

(i) Liens on property or assets of any corporation existing at the time such
corporation becomes a Restricted Subsidiary;

 

(ii) Liens existing on any property or asset at or prior to the acquisition
thereof by such Borrower or a Restricted Subsidiary, Liens on any property or
asset securing the payment of all or any part of the purchase price of such

 

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property or asset, Liens on any property or asset securing any Indebtedness
incurred prior to, at the time of or within 180 days after the acquisition of
such property or asset for the purpose of financing all or any part of the
purchase price thereof or Liens on any property or asset securing any
Indebtedness incurred for the purpose of financing all or any part of the cost
to such Borrower or Restricted Subsidiary of improvements thereto;

 

(iii) Liens securing Indebtedness of a Restricted Subsidiary owing to Alcoa or
to another Restricted Subsidiary;

 

(iv) Liens existing on December 31, 2003, and set forth on Schedule 6.01(a);

 

(v) Liens on property of a person existing (or, in the case of Alumax Inc., that
shall have existed) at the time such person is merged into or consolidated with
Alcoa or a Restricted Subsidiary or at the time such person becomes a subsidiary
of Alcoa through the direct or indirect acquisition of capital stock of such
person by Alcoa or at the time of a sale, lease or other disposition of the
properties of a person as an entirety or substantially as an entirety to Alcoa
or a Restricted Subsidiary;

 

(vi) Liens on any property owned by Alcoa or any Restricted Subsidiary, in favor
of the United States of America or any state thereof, or any department, agency
or instrumentality or political subdivision of the United States of America or
any State thereof, or in favor of any other country, or any political
subdivision thereof, to secure partial, progress, advance or other payments
pursuant to any contract or statute or to secure any Indebtedness incurred for
the purpose of financing all or any part of the purchase price or the cost of
construction of the property subject to such Liens; and

 

(vii) any extension, renewal or replacement (or successive extensions, renewals
or replacements) in whole or in part of the Liens referred to in clauses (i)
through (vi) of this Section 6.01(a); provided, however, that each such
extension, renewal or replacement is limited to all or a part of the property
which secured the Lien so extended, renewed or replaced (and any improvements
thereon).

 

(b) Notwithstanding paragraph (a) of this Section 6.01 and in addition to the
Liens permitted thereunder, each Borrower and any Restricted Subsidiary may
create or incur Liens which would otherwise be subject to the foregoing
restrictions to secure Indebtedness for borrowed money in an aggregate amount
which does not at the time exceed 10% of the Consolidated Net Tangible Assets of
Alcoa and its consolidated Subsidiaries at such time.

 

SECTION 6.02. Consolidation, Merger, Sale of Assets, etc. Consolidate or merge
with or into any other person or sell, lease or transfer all or substantially
all of its property and assets, or agree to do any of the foregoing, unless (a)
no Default or Event

 

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of Default has occurred and is continuing or would result immediately after
giving effect thereto, (b) if such Borrower is not the surviving corporation or
if such Borrower sells, leases or transfers all or substantially all of its
property and assets, the surviving corporation or person purchasing or being
leased the assets agrees to be bound by the terms and provisions applicable to
such Borrower hereunder, and (c)(i) in the case of Alcoa, immediately after such
transaction, individuals who were directors of Alcoa during the twelve month
period prior to such merger, sale or lease (together with any replacement or
additional directors whose election was recommended by or who were elected by a
majority of directors then in office) constitute the Board of Directors of the
surviving corporation or the person purchasing or being leased the assets and
(ii) in the case of a Borrowing Subsidiary, (A) the surviving corporation or the
person purchasing or being leased the assets is a wholly-owned Subsidiary of
Alcoa and (B) if the surviving corporation or such person is not Alcoa, Alcoa
agrees to guarantee pursuant to Article VIII the obligations of such person
under this Agreement.

 

SECTION 6.03. Financial Undertaking. In the case of Alcoa, permit the aggregate
principal amount of (a) the Indebtedness of Alcoa and its consolidated
Subsidiaries, after eliminating intercompany items, plus (b) all other
liabilities of Alcoa and its consolidated Subsidiaries, after eliminating
intercompany items, in respect of any guarantee or endorsement (except the
endorsement of negotiable instruments for deposit or collection or similar
transactions in the normal course of business) of the Indebtedness of any person
to exceed 150% of Consolidated Net Worth of Alcoa and its consolidated
Subsidiaries.

 

SECTION 6.04. Change in Business. In the case of Alcoa, make or permit any
substantial change in the general nature of the business carried on by Alcoa and
its consolidated Subsidiaries as at the date hereof, including any such
alteration arising from an acquisition, which would reasonably be expected to
result in a Material Adverse Effect.

 

ARTICLE VII

 

EVENTS OF DEFAULT

 

In case of the happening of any of the following events (“Events of Default”):

 

(a) any Borrower shall default in the payment when due of any principal of any
Loan and, if such default shall result from the failure of any third party
payments system used by such Borrower, such default shall continue for a period
of two Business Days;

 

(b) any Borrower shall fail to pay when due any interest, fee or other amount
payable under this Agreement or Alcoa shall fail to pay any amount due under
Article VIII upon demand therefor, and, in each case, such failure shall
continue for a period of five Business Days;

 

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(c) any representation or warranty made in Section 3.09 shall prove to have been
false or misleading in any material respect as of the time when made (including
by omission of material information necessary to make such representation or
warranty not misleading); or any other representation or warranty made by a
Borrower under this Agreement or any statement made by a Borrower in any
financial statement, certificate, report, exhibit or document furnished by or on
behalf of such Borrower in connection with this Agreement shall prove to have
been false or misleading in any material respect as of the time when made and,
if such representation or warranty is able to be corrected, such representation
or warranty is not corrected within 20 days after such Borrower’s knowledge that
it was false or misleading;

 

(d) any Borrower shall default in the performance or observance of any covenant
contained in Section 5.02, Section 5.06(a), Section 5.08(a) or Article VI;

 

(e) any Borrower shall default in the performance or observance of any covenant
or agreement under this Agreement (other than those specified in paragraphs (a),
(b) and (d) above) and such default shall continue for a period of 10 Business
Days, in the case of a default with respect to Section 5.08(b) or (c), or in any
other case a period of 30 days after notice from the Administrative Agent;

 

(f) any Borrower shall (i) default in the payment of any principal or interest
beyond any period of grace provided with respect thereto, due in respect of any
Indebtedness in a principal amount in excess of $20,000,000; or (ii) fail to
observe or perform any other term, covenant, condition or agreement contained in
any agreement or instrument evidencing or governing any such Indebtedness if the
effect of any such failure referred to in this paragraph (f) is to cause such
Indebtedness to become due prior to its stated maturity;

 

(g) a proceeding shall have been instituted or a petition filed in respect of a
Borrower

 

(i) seeking to have an order for relief entered in respect of such Borrower, or
seeking a declaration or entailing a finding that such Borrower is insolvent or
a similar declaration or finding, or seeking dissolution, winding-up, revocation
or forfeiture of charter or Memorandum and Articles of Association, liquidation,
reorganization, arrangement, adjustment, composition or other relief with
respect to such Borrower, its assets or its debts under any law relating to
bankruptcy, insolvency, relief of debtors or protection of creditors,
termination of legal entities or any other similar law now or hereafter in
effect, or

 

(ii) seeking appointment of a receiver, trustee, custodian, liquidator,
assignee, sequestrator, administrator or other similar official for such
Borrower or for all or any substantial part of its property,

 

and such proceeding or petition shall remain undismissed for a period of 90
consecutive days or an order or decree approving any of the foregoing shall be
entered;

 

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(h) any Borrower shall become insolvent, shall become generally unable to pay
its debts as they become due, shall voluntarily suspend transaction of its
business generally or as a whole, shall make a general assignment for the
benefit of creditors, shall institute a proceeding described in clause (g)(i)
above or shall consent to any order or decree described therein, shall institute
a proceeding described in clause (g)(ii) above or shall consent to any such
appointment or to the taking of possession by any such official of all or any
substantial part of its property whether or not any such proceeding is
instituted, shall dissolve, wind-up or liquidate itself or any substantial part
of its property or shall take any action in furtherance of any of the foregoing;

 

(i) any of the following shall have occurred: (i) any person or group of persons
shall have acquired beneficial ownership of a majority in interest of the
outstanding Voting Stock of Alcoa (within the meaning of Section 13(d) or 14(d)
of the Securities Exchange Act of 1934 and the applicable rules and regulations
thereunder), (ii) during any period of 25 consecutive months, commencing before
or after the date of this Agreement, individuals who at the beginning of such 25
month period were directors of Alcoa (together with any replacement or
additional directors whose election was recommended by or who were elected by a
majority of directors then in office) cease to constitute a majority of the
Board of Directors of Alcoa or (iii) any person or group of related persons
shall acquire all or substantially all of the assets of Alcoa; provided,
however, that a change in control of Alcoa shall not be deemed to have occurred
pursuant to clause (iii) of this paragraph (i) if Alcoa shall have merged or
consolidated with or transferred all or substantially all of its assets to
another person in compliance with the provisions of Section 6.02 and the ratio
represented by the total assets of the surviving person, successor or transferee
divided by such person’s stockholders’ equity, in each case as determined and as
would be shown in a consolidated balance sheet of such person prepared in
accordance with GAAP (the “Leverage Ratio” of such person) is no greater than
the then Leverage Ratio of Alcoa immediately prior to such event;

 

(j) an ERISA Event or ERISA Events shall have occurred with respect to any Plan
or Plans, or any Foreign Plan or Foreign Plans, that reasonably could be
expected to result in liability of any Borrower to the PBGC or other
Governmental Authority or to a Plan or Foreign Plan in an aggregate amount
exceeding $25,000,000 and, within 30 days after the reporting of any such ERISA
Event to the Administrative Agent or after the receipt by the Administrative
Agent of the statement required pursuant to Section 5.07(b), the Administrative
Agent shall have notified the Borrower in writing that (i) the Required Lenders
have made a determination that, on the basis of such ERISA Event or ERISA Events
or the failure to make a required payment, there are reasonable grounds (A) for
the termination of such Plan or Plans, or such Foreign Plan or Foreign Plans, by
the PBGC or other Governmental Authority, (B) for the appointment either by the
appropriate United States District Court of a trustee to administer such Plan or
Plans or by an applicable court of law outside the United States of a trustee to
administer such Foreign Plan or Foreign Plans or (C) for the imposition of a
lien in favor of a Plan or Foreign Plan and (ii) as a result thereof an Event of
Default exists hereunder; or a trustee shall be appointed by a United States
District Court to administer any such Plan or Plans or by an applicable court of
law outside the United States of a trustee to administer such Foreign Plan or
Foreign Plans; or the PBGC or other Governmental Authority shall institute
proceedings to terminate any Plan or Plans or any Foreign Plan or Foreign Plans;

 

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(k) (i) any Borrower or any ERISA Affiliate shall have been notified by the
sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability to
such Multiemployer Plan, (ii) such Borrower or such ERISA Affiliate does not
have reasonable grounds for contesting such Withdrawal Liability or is not in
fact contesting such Withdrawal Liability in a timely and appropriate manner and
does not have adequate reserves set aside against such Withdrawal Liability and
(iii) the amount of the Withdrawal Liability specified in such notice, when
aggregated with all other amounts required to be paid to Multiemployer Plans in
connection with Withdrawal Liabilities (determined as of the date or dates of
such notification), exceeds $25,000,000 or requires payments exceeding
$25,000,000 in any calendar year;

 

(l) any Borrower or any ERISA Affiliate shall have been notified by the sponsor
of a Multiemployer Plan that such Multiemployer Plan is in reorganization or is
being terminated, within the meaning of Title IV of ERISA, if solely as a result
of such reorganization or termination the aggregate annual contributions of such
Borrower and its ERISA Affiliates to all Multiemployer Plans that are then in
reorganization or have been or are being terminated have been or will be
increased over the amounts required to be contributed to such Multiemployer
Plans for their most recently completed plan years by an amount exceeding
$25,000,000;

 

(m) one or more judgments for the payment of money in an aggregate amount in
excess of $50,000,000 shall be rendered against any Borrower or any Subsidiary
of any Borrower or any combination thereof and the same shall remain
undischarged for a period of 45 consecutive days during which execution shall
not be effectively stayed (unless an appeal or writ of certiorari is being
diligently prosecuted), or any action shall be legally taken by a judgment
creditor or creditors holding judgments which in the aggregate exceed
$50,000,000 to levy upon assets or properties of any Borrower or any Subsidiary
of a Borrower to enforce any such judgment; or

 

(n) Any “Event of Default” as defined in the 2003 Five-Year Credit Agreement or
the 364-Day Credit Agreement shall occur and be continuing;

 

then, and in every such event (other than an event described in paragraph (g) or
(h) above), and at any time thereafter during the continuance of such event, the
Administrative Agent, at the request of the Required Lenders, shall, by written
notice to Alcoa, take either or both of the following actions, at the same or
different times: (i) terminate the Commitments, and (ii) declare the Loans then
outstanding to be forthwith due and payable in whole or in part, whereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and any unpaid accrued fees and all other liabilities accrued
hereunder, shall become forthwith due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived by each Borrower, anything contained herein to the contrary
notwithstanding; and in any event described in paragraph (g) or (h) above, the
Commitments of the Lenders shall automatically terminate and the principal of
the Loans

 

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then outstanding, together with accrued interest thereon and any unpaid accrued
fees and all other liabilities accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by each Borrower, anything
contained herein to the contrary notwithstanding.

 

ARTICLE VIII

 

GUARANTEE

 

Alcoa unconditionally and irrevocably guarantees, as a principal obligor and not
merely as a surety, the due and punctual payment and performance of all
Borrowing Subsidiary Obligations. Alcoa further agrees that the Borrowing
Subsidiary Obligations may be extended or renewed, in whole or in part, without
notice or further assent from it, and that it will remain bound upon the
provisions of this Article VIII notwithstanding any extension or renewal of any
Borrowing Subsidiary Obligation.

 

Alcoa waives presentation to, demand of payment from and protest to any
Borrowing Subsidiary of any of the Borrowing Subsidiary Obligations, and also
waives notice of acceptance of the guarantee set forth in this Article VIII and
notice of protest for nonpayment. The obligations of Alcoa hereunder shall not
be affected by (a) the failure of the Administrative Agent or any Lender to
assert any claim or demand or to enforce any right or remedy against any
Borrowing Subsidiary under the provisions of this Agreement or any guarantee;
(b) any extension or renewal of any provision of this Agreement or any
guarantee; or (c) any rescission, waiver, amendment or modification of any of
the terms or provisions of this Agreement or any guarantee or any other
agreement.

 

Alcoa further agrees that the guarantee set forth in this Article VIII
constitutes a guarantee of payment when due and not of collection and waives any
right to require that any resort be had by the Administrative Agent or any
Lender to the balance of any deposit account or credit on the books of the
Administrative Agent or the relevant Lender, as applicable, in favor of any
Borrowing Subsidiary or any other person.

 

The obligations of Alcoa hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim or
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality or unenforceability of the Borrowing
Subsidiary Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of Alcoa hereunder shall not be discharged or
impaired or otherwise affected by the failure of the Administrative Agent or any
Lender to assert any claim or demand or to enforce any remedy under this
Agreement, by any waiver or modification of any thereof, by any default, failure
or delay, wilful or otherwise, in the performance of the Borrowing Subsidiary
Obligations or by any other act or omission which may or might in any manner or
to any extent vary the risk of Alcoa or would otherwise operate as a discharge
of Alcoa as a matter of law or equity.

 

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Alcoa further agrees that this guarantee shall continue to be effective or be
reinstated, as the case may be, if at any time payment by any Borrowing
Subsidiary to the Administrative Agent or any Lender, or any part thereof, of
principal of or interest on such Borrowing Subsidiary Obligation is rescinded or
must otherwise be restored by the Administrative Agent or any Lender or any
holder of any Borrowing Subsidiary Obligation upon the bankruptcy or
reorganization of such Borrowing Subsidiary or otherwise.

 

In furtherance of the foregoing and not in limitation of any other right which
the Administrative Agent or any Lender may have at law or in equity against
Alcoa by virtue hereof, upon the failure of any Borrowing Subsidiary to pay any
Borrowing Subsidiary Obligation when and as the same shall become due, whether
at maturity, by acceleration, after notice of prepayment or otherwise, Alcoa
hereby promises to and will, upon receipt of written demand by the
Administrative Agent, promptly pay, or cause to be paid, to such Agent in cash
the amount of such unpaid Borrowing Subsidiary Obligation, and thereupon such
Agent shall assign, in any reasonable manner, the amount of the Borrowing
Subsidiary Obligation paid by Alcoa pursuant to this guarantee to Alcoa, such
assignment to be pro tanto to the extent to which the Borrowing Subsidiary
Obligation in question was discharged by Alcoa, or make such other disposition
thereof as Alcoa shall direct (all without recourse to the Administrative Agent
or any Lender and without any representation or warranty by the Administrative
Agent or Lender).

 

Upon payment by Alcoa of any sums to the Administrative Agent as provided above,
all rights of Alcoa against the Borrowing Subsidiaries arising as a result
thereof by way of right of subrogation or otherwise shall in all respects be
subordinate and junior in right of payment to the prior indefeasible payment in
full of all the Borrowing Subsidiary Obligations.

 

ARTICLE IX

 

THE ADMINISTRATIVE AGENT

 

In order to expedite the transactions contemplated by this Agreement, JPMorgan
Chase Bank is hereby appointed to act as the Administrative Agent on behalf of
the Lenders. Each of the Lenders hereby irrevocably authorizes the
Administrative Agent to take such actions on behalf of such Lender and to
exercise such powers as are specifically delegated to such Agent by the terms
and provisions hereof, together with such actions and powers as are reasonably
incidental thereto. The Administrative Agent is hereby expressly authorized by
the Lenders, without hereby limiting any implied authority, (a) to receive on
behalf of the Lenders all payments of principal of and interest on the Loans and
all other amounts due to the Lenders hereunder, and promptly to distribute to
each Lender its proper share of each payment so received; (b) to give notice on
behalf of each of the Lenders to the relevant Borrower of any Event of Default
specified in this Agreement of which the Administrative Agent has actual
knowledge acquired in connection with its agency hereunder; and (c) to
distribute to each Lender copies of all notices, financial statements and other
materials delivered by any Borrower pursuant to this Agreement as received by
such Agent.

 

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None of the Administrative Agent or any of its directors, officers, employees or
agents shall be liable as such for any action taken or omitted by any of them
except for its or his own gross negligence or wilful misconduct, or be
responsible for any statement, warranty or representation herein or the contents
of any document delivered in connection herewith, or be required to ascertain or
to make any inquiry concerning the performance or observance by any Borrower of
any of the terms, conditions, covenants or agreements contained herein. The
Administrative Agent shall not be responsible to the Lenders or any assignee
thereof for the due execution, genuineness, validity, enforceability or
effectiveness of this Agreement or other instruments or agreements. The
Administrative Agent shall in all cases be fully protected in acting, or
refraining from acting, in accordance with written instructions signed by the
Required Lenders and, except as otherwise specifically provided herein, such
instructions and any action or inaction pursuant hereto shall be binding on all
the Lenders and each assignee of any such Lender. The Administrative Agent
shall, in the absence of knowledge to the contrary, be entitled to rely on any
instrument or document believed by it in good faith to be genuine and correct
and to have been signed or sent by the proper person or persons. None of the
Administrative Agent or any of its directors, officers, employees or agents
shall have any responsibility to any Borrower on account of the failure of or
delay in performance or breach by any other Lender or any Borrower of any of
their respective obligations hereunder or in connection herewith. The
Administrative Agent may execute any and all duties hereunder by or through
agents or employees and shall be entitled to rely upon the advice of legal
counsel selected by it with respect to all matters arising hereunder and shall
not be liable for any action taken or suffered in good faith by it in accordance
with the advice of such counsel.

 

The Lenders hereby acknowledge that the Administrative Agent shall not be under
any duty to take any discretionary action permitted to be taken by it pursuant
to the provisions of this Agreement unless it shall be requested in writing to
do so by the Required Lenders.

 

Subject to the appointment and acceptance of a successor Administrative Agent as
provided below, the Administrative Agent may resign at any time by notifying the
Lenders and the Borrowers. Upon any such resignation, the Required Lenders shall
have the right to appoint a successor; provided, however, that Alcoa has
approved such successor (such consent not to be unreasonably withheld or delayed
and not to be required if an Event of Default exists). If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Administrative Agent, subject to the prior approval of Alcoa
(such consent not to be unreasonably withheld or delayed and not to be required
if an Event of Default exists), which shall be a bank with an office in New
York, New York, having total assets in excess of $10,000,000,000 or an Affiliate
of any such bank. Upon the acceptance of any appointment as the Administrative
Agent hereunder by a successor bank, such successor shall succeed to and become
vested with all the

 

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rights, powers, privileges and duties of the retiring Agent and the retiring
Agent shall be discharged from its duties and obligations hereunder. After the
Agent’s resignation hereunder the provisions of this Article and Section 10.05
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Administrative Agent.

 

With respect to the Loans made by it hereunder, the Administrative Agent in its
individual capacity and not as Agent shall have the same rights and powers as
any other Lender and may exercise the same as though it were not an
Administrative Agent, and such Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of business with any
Borrower or any Subsidiary or other Affiliate of Alcoa as if it were not an
Agent.

 

Each Lender agrees (i) to reimburse the Administrative Agent, on demand, in the
amount of its pro rata share (based on its Commitment hereunder) of any expenses
incurred for the benefit of the Lenders by such Agent, including counsel fees
and compensation of agents and employees paid for services rendered on behalf of
the Lenders, which shall not have been reimbursed by the Borrowers and (ii) to
indemnify and hold harmless the Administrative Agent and any of its directors,
officers, employees, agents or Affiliates, on demand, in the amount of such pro
rata share, from and against any and all liabilities, taxes, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against it in its capacity as an Administrative Agent or any of
them in any way relating to or arising out of this Agreement or any action taken
or omitted by it or any of them under this Agreement, to the extent the same
shall not have been reimbursed by the Borrowers; provided that no Lender shall
be liable to the Administrative Agent for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the gross negligence or wilful
misconduct of such Agent or any of its directors, officers, employees, agents or
Affiliates.

 

Each Lender acknowledges that it has, independently and without reliance upon
the Administrative Agent or other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Administrative Agent or other
Lender and based on such documents and information as it shall from time to time
deem appropriate, continue to make its own decisions in taking or not taking
action under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.

 

ARTICLE X

 

MISCELLANEOUS

 

SECTION 10.01. Notices. Notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy as follows:

 

(a) if to Alcoa or a Borrowing Subsidiary, to Alcoa Inc. at 390 Park Avenue, New
York, New York 10022-4608, Attention of Vice President & Treasurer (Telecopy No.
212-836-2823);

 

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(b) if to the Administrative Agent, to JPMorgan Chase Bank at 1111 Fannin
Street, Houston, Texas 77002, Attention of Andrew Perkins (Telecopy No.
713-750-2223), with a copy to JPMorgan Chase Bank at 270 Park Avenue, New York,
New York 10017, Attention of James Ramage (Telecopy No. 212-270-5100);

 

(c) if to a Lender, to it at its address (or telecopy number) set forth in
Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender
shall have become a party hereto.

 

Any party may subsequently change its notice address by written notice to the
other parties as herein provided. All notices and other communications given to
any party hereto in accordance with the provisions of this Agreement shall be
deemed to have been given on the date of receipt if delivered by hand or
overnight courier service or sent by telecopy or on the date five Business Days
after dispatch by certified or registered mail if mailed, in each case
delivered, sent or mailed (properly addressed) to such party as provided in this
Section 10.01 or in accordance with the latest unrevoked direction from such
party to the Administrative Agent and each Borrower given in accordance with
this Section 10.01.

 

Notices and other communications to the Lenders 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 Article II unless otherwise agreed by the Administrative Agent and
the applicable Lender and provided further that any Lender may, upon request,
receive a hard copy delivery of any or all such notices. The Administrative
Agent or Alcoa 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.

 

Any notice hereunder shall be effective upon receipt. Any notice or other
communication received on a day which is not a Business Day or after business
hours in the place of receipt shall be deemed to be served on the next following
Business Day in such place. Any notice given to Alcoa shall be deemed to have
been duly given to each other Borrower at the same time and in the same manner.

 

SECTION 10.02. Survival of Agreement. All covenants, agreements, representations
and warranties made by any Borrower herein and in the certificates or other
instruments prepared or delivered in connection with or pursuant to this
Agreement shall be considered to have been relied upon by the Lenders and shall
survive the making by the Lenders of the Loans, regardless of any investigation
made by the Lenders or on their behalf, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under this Agreement is outstanding and unpaid
and so long as the Commitments have not been terminated.

 

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SECTION 10.03. Binding Effect. This Agreement shall become effective when it
shall have been executed by Alcoa and the Administrative Agent and when the
Administrative Agent shall have received copies hereof which, when taken
together, bear the signatures of each Lender, and thereafter shall be binding
upon and inure to the benefit of the Borrowers, the Administrative Agent and
each Lender and their respective successors and assigns, except that none of the
Borrowers shall have the right to assign its rights hereunder or any interest
herein without the prior consent of all the Lenders.

 

SECTION 10.04. Successors and Assigns; Additional Borrowing Subsidiaries. (a)
The provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns permitted
hereby, except that (i) the Borrowers may not assign or otherwise transfer any
of their rights or obligations hereunder (except as provided in Section
10.04(e)) without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrowers without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section. Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any person
(other than the parties hereto, their respective successors and assigns
permitted hereby, Participants (to the extent provided in paragraph (c) of this
Section) and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

 

(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans at the time owing to it); with the prior written consent (such
consent not to be unreasonably withheld) of:

 

(A) Alcoa, provided that no consent of Alcoa shall be required for an assignment
to a Lender, an Affiliate of a Lender, an Approved Fund (as defined below) or,
if an Event of Default under clause (a), (b), (g) or (h) of Article VII has
occurred and is continuing, any other assignee; and

 

(B) the Administrative Agent.

 

(ii) Assignments shall be subject to the following conditions:

 

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s
Commitment, the amount of the Commitment of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and Assumption with
respect to such assignment is delivered to the Administrative Agent) shall not
be less than $5,000,000

 

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unless each of Alcoa and the Administrative Agent otherwise consent, provided
that no such consent of Alcoa shall be required if an Event of Default under
clause (a), (b), (g) or (h) of Article VII has occurred and is continuing);

 

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

 

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500;

 

(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire; and

 

(E) in the case of an assignment to a CLO (as defined below), the assigning
Lender shall retain the sole right to approve any amendment, modification or
waiver of any provision of this Agreement, provided that the Assignment and
Assumption between such Lender and such CLO may provide that such Lender will
not, without the consent of such CLO, agree to any amendment, modification or
waiver described in the proviso to Section 10.08(b) that affects such CLO.

 

For purposes of this Section 10.04(b), the terms “Approved Fund” and “CLO” have
the following meanings:

 

“Approved Fund” means (a) a CLO and (b) with respect to any Lender that is a
fund which invests in bank loans and similar extensions of credit, any other
fund that invests in bank loans and similar extensions of credit and is managed
by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.

 

“CLO” means any entity (whether a corporation, partnership, trust or otherwise)
that is engaged in making, purchasing, holding or otherwise investing in bank
loans and similar extensions of credit in the ordinary course of its business
and is administered or managed by a Lender or an Affiliate of such Lender.

 

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto with respect to
the interests assumed and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned under such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.12, 2.14, 2.18 and 10.05).

 

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(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrowers, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to 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 pursuant to the terms hereof from time to time (the
“Register”). The entries in the Register shall be conclusive in the absence of
manifest error, and the Borrowers, the Administrative Agent and the Lenders may
treat each person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding
notice to the contrary. The Register shall be available for inspection by the
Borrowers and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

 

(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an assignee, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall promptly (i) accept such Assignment and
Assumption, (ii) record the information contained therein in the Register and
(iii) give notice thereof to Alcoa. No assignment shall be effective for
purposes of this Agreement until it has been recorded in the Register as
provided in this paragraph.

 

(c) (i) Any Lender may, without the consent of any Borrower and the
Administrative Agent, sell participations to one or more banks or other entities
(a “Participant”) in all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
owing to it); provided that (A) such Lender’s obligations under this Agreement
shall remain unchanged, (B) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (C) the
Borrowers, the Administrative Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the proviso to Section 10.08(b) that affects such Participant.
Subject to paragraph (c)(ii) of this Section, Alcoa agrees that each Participant
shall be entitled to the benefits of Sections 2.12 and 2.18 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 10.06 as though it were a
Lender, provided such Participant agrees to be subject to Section 2.16 as though
it were a Lender.

 

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(ii) A Participant shall not be entitled to receive any greater payment under
Section 2.12 or 2.18 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with Alcoa’s prior written
consent.

 

(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank, and the other provisions of this Section 10.04 shall not apply to
any such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any of
its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.

 

(e) Unless an Event of Default has occurred and is continuing, Alcoa at any time
and from time to time may designate any wholly-owned Subsidiary to be a
Borrowing Subsidiary upon the completion of the following: (i) each of Alcoa and
such Subsidiary shall have executed and delivered to the Administrative Agent a
Designation of Borrowing Subsidiary and (ii) such Subsidiary shall have complied
with Section 4.03, whereupon (A) such Subsidiary shall become a party hereto and
shall have the rights and obligations of a Borrowing Subsidiary hereunder and
(B) the obligations of such Subsidiary shall become part of the Borrowing
Subsidiary Obligations and the guarantee of Alcoa pursuant to Article VIII
hereof shall apply thereto to the same extent that it applies to the other
Borrowing Subsidiary Obligations, if any (the date on which any such designation
shall occur being called a “Designation Date”).

 

SECTION 10.05. Expenses; Indemnity. (a) Alcoa agrees to pay or cause one or more
other Borrowers to pay all reasonable out-of-pocket expenses incurred by the
Administrative Agent in connection with the preparation of this Agreement or in
connection with any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions hereby contemplated shall be
consummated) or incurred by the Administrative Agent or any Lender in connection
with the enforcement of their rights in connection with this Agreement or in
connection with the Loans made hereunder, including the reasonable fees, charges
and disbursements of Cravath, Swaine & Moore LLP, counsel for the Administrative
Agent, and, in connection with any such enforcement, the reasonable fees,
charges and disbursements of any other counsel for the Administrative Agent or
any Lender. Alcoa further agrees to indemnify or cause one or more other
Borrowers to indemnify the Lenders from and hold them harmless against any
documentary taxes, assessments or charges made by any Governmental Authority by
reason of the execution and delivery of this Agreement.

 

(b) Alcoa agrees to indemnify or cause one or more other Borrowers to indemnify
the Administrative Agent, each Lender and each of their respective Affiliates,
directors, officers, employees and agents (each such person being called an
“Indemnitee”) against, and to hold or cause one or more other Borrowers to hold
each Indemnitee harmless from, any and all losses, claims, damages, liabilities
and related expenses, including reasonable counsel fees, charges and
disbursements, incurred by or asserted against any Indemnitee arising out of, in
any way connected with, or as a result

 

50

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

of (i) the execution or delivery of this Agreement or any agreement or
instrument contemplated hereby, the performance by the parties thereto of their
respective obligations thereunder or the consummation of the transactions
contemplated thereby, (ii) the use of the proceeds of the Loans or (iii) any
claim, litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or wilful misconduct of such Indemnitee. The Administrative
Agent and each Lender agrees to promptly notify Alcoa of any claims relating to
clauses (i), (ii) or (iii) of the next preceding sentence; provided, however,
that any failure to deliver any such notice shall not relieve Alcoa from its
obligations under this paragraph (b).

 

(c) The provisions of this Section 10.05 shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the invalidity or unenforceability of any term or provision of this
Agreement, or any investigation made by or on behalf of the Administrative Agent
or Lender. All amounts due under this Section 10.05 shall be payable on written
demand therefor.

 

SECTION 10.06. Right of Setoff. If an Event of Default shall have occurred and
be continuing, each Lender is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender or its Affiliates
to or for the credit or the account of any Borrower against any of and all the
obligations of such Borrower (or, in the case of Alcoa, any of and all the
obligations of any Borrowing Subsidiary) now or hereafter existing under this
Agreement held by such Lender, irrespective of whether or not such Lender shall
have made any demand under this Agreement or otherwise and although such
obligations may be unmatured. The rights of each Lender under this Section are
in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.

 

SECTION 10.07. Applicable Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

 

SECTION 10.08. Waivers; Amendment. (a) No failure or delay of the Administrative
Agent or any Lender in exercising any power or right hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Administrative Agent and
the Lenders hereunder are cumulative and are not exclusive of any rights or
remedies which they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by any Borrower therefrom shall in any
event be effective unless the same shall be permitted by

 

51

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

paragraph (b) below, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. No notice or demand
on any Borrower in any case shall entitle such Borrower to any further notice or
shall entitle such Borrower or any other Borrower to notice or demand in similar
or other circumstances.

 

(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Borrowers and the Required Lenders; provided, however, that no such
agreement shall (i) decrease the principal amount of, or extend the maturity of
or any scheduled principal payment date or date for the payment of any interest
on any Loan or date fixed for payment of any Facility Fee, or waive or excuse
any such payment or any part thereof, or decrease the rate of interest on any
Loan, without the prior written consent of each Lender affected thereby, (ii)
change or extend the Commitment or decrease the Facility Fees of any Lender
without the prior written consent of such Lender, (iii) amend or modify the
provisions of Section 2.14, 2.15, the provisions of Article VIII, the provisions
of this Section or the definition of “Required Lenders”, without the prior
written consent of each Lender or (iv) amend, modify or otherwise affect the
rights or duties of the Administrative Agent hereunder without the prior written
consent of such Agent. Each Lender and each assignee thereof shall be bound by
any waiver, consent, amendment or modification authorized by this Section.

 

SECTION 10.09. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the applicable interest rate, together with all fees
and charges which are treated as interest under applicable law (collectively the
“Charges”), as provided for herein or in any other document executed in
connection herewith, or otherwise contracted for, charged, received, taken or
reserved by any Lender, shall exceed the maximum lawful rate (the “Maximum
Rate”) which may be contracted for, charged, taken, received or reserved by such
Lender in accordance with applicable law, the rate of interest payable to such
Lender, together with all Charges payable to such Lender, shall be limited to
the Maximum Rate.

 

SECTION 10.10. Entire Agreement. This Agreement and any fee arrangements related
hereto constitute the entire contract between the parties relative to the
subject matter hereof. Any previous agreement among the parties with respect to
the subject matter hereof is superseded by this Agreement and the fee
arrangements related hereto.

 

SECTION 10.11. Waiver of Jury Trial. Each party hereto hereby waives, to the
fullest extent permitted by applicable law, any right it may have to a trial by
jury in respect of any litigation directly or indirectly arising out of, under
or in connection with this Agreement. Each party hereto (a) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (b) acknowledges that it and the other
parties hereto have been induced to enter into this Agreement, as applicable,
by, among other things, the mutual waivers and certifications in this Section
10.11.

 

52

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

SECTION 10.12. Severability. In the event any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby. The parties shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.

 

SECTION 10.13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute but one contract, and shall become effective as
provided in Section 10.03.

 

SECTION 10.14. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

 

SECTION 10.15. Jurisdiction, Consent to Service of Process. (a) Each Borrower
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
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 Agreement shall
affect any right that any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against any Borrower or its properties in
the courts of any jurisdiction.

 

(b) Each 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 Agreement in any New York State or Federal court.
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.

 

(c) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 10.01. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.

 

SECTION 10.16. Conversion of Currencies. (a) If, for the purpose of obtaining
judgment in any court, it is necessary to convert a sum due hereunder in dollars

 

53

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

into another currency, the parties hereto agree, to the fullest extent that they
may legally and effectively do so, that the rate of exchange used shall be that
at which in accordance with normal banking procedures the Administrative Agent
could purchase dollars with such other currency in The City of New York, on the
Business Day immediately preceding the day on which final judgment is given.

 

(b) The obligation of each Borrower in respect of any sum due to any Lender
hereunder in dollars shall, to the extent permitted by applicable law,
notwithstanding any judgment in a currency other than dollars, be discharged
only to the extent that on the Business Day following receipt of any sum
adjudged to be so due in the judgment currency such Lender may in accordance
with normal banking procedures purchase dollars in the amount originally due to
such Lender with the judgment currency. If the amount of dollars so purchased is
less than the sum originally due to such Lender, such Borrower agrees, as a
separate obligation and notwithstanding any such judgment, to indemnify such
Lender against the resulting loss.

 

SECTION 10.17. USA Patriot Act. Each Lender hereby notifies each 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 such Borrower, which information
includes the name and address of such Borrower and other information that will
allow such Lender to identify such Borrower in accordance with the Act.

 

54

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

IN WITNESS WHEREOF, Alcoa, the Administrative Agent and the Lenders have caused
this Agreement to be duly executed by their respective authorized officers as of
the day and year first written above.

 

ALCOA INC.,

by

 

 

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

Name:

   

Title:

   

JPMORGAN CHASE BANK,

individually and as

Administrative Agent,

by

 

 

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

Name:

   

Title:

   

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

SIGNATURE PAGE TO THE

ALCOA INC. FIVE-YEAR

REVOLVING CREDIT

AGREEMENT DATED AS

OF APRIL 23, 2004

LENDER:

 

 

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

by

 

 

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

Name:

   

Title:

   

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

EXHIBIT A

TO CREDIT AGREEMENT

 

[FORM OF]

 

Assignment and Assumption

 

Reference is made to the Five-Year Revolving Credit Agreement dated as of April
23, 2004 (as amended from time to time, the “Credit Agreement”), among Alcoa
Inc. (“Alcoa”), a Pennsylvania corporation, certain subsidiaries of Alcoa, the
Lenders, and JPMorgan Chase Bank, as the Administrative Agent for the Lenders.
Terms defined in the Credit Agreement are used herein with the same meanings.

 

1. The Assignor hereby sells and assigns, without recourse, to the Assignee, and
the Assignee hereby purchases and assumes, without recourse, from the Assignor,
effective as of the Assignment Effective Date set forth below, the interests set
forth below (the “Assigned Interest”) in the Assignor’s rights and obligations
under the Credit Agreement, including, without limitation, the Commitment of the
Assignor on the Assignment Effective Date and the Loans owing to the Assignor
which are outstanding on the Assignment Effective Date, together with unpaid
interest accrued on the assigned Loans to the Assignment Effective Date and the
amount, if any, set forth below hereof of the fees accrued to the Assignment
Effective Date for the account of the Assignor. From and after the Assignment
Effective Date (i) the Assignee shall if not already a Lender, become a party to
and be bound by the provisions of the Credit Agreement and, to the extent of the
interests assigned by this Assignment and Assumption, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent of
the interests assigned by this Assignment and Assumption, relinquish its rights
and be released from its obligations under the Credit Agreement.

 

2. This Assignment and Assumption is being delivered to the Administrative Agent
together with (i) if the Assignee is a Lender and is organized under the laws of
a jurisdiction outside the United States, the forms specified in Section 2.18(g)
of the Credit Agreement, duly completed and executed by such Assignee, (ii) if
the Assignee is not already a Lender under the Credit Agreement, an
Administrative Questionnaire in the form of Exhibit B to the Credit Agreement
and (iii) a processing and recordation fee of $3,500.

 

3. This Assignment and Assumption shall be governed by and construed in
accordance with the laws of the State of New York.

 

Date of Assignment:

Legal Name of Assignor:

Legal Name of Assignee:

Assignee’s Address for Notices:

Assignment Effective Date of Assignment:

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

Facility/Commitment

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

  

Principal

Amount Assigned

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

   Percentage Assigned of Applicable
Facility/Commitment(set forth, to at least
8 decimals, as a percentage of the Facility
and the aggregate  Commitments of all
Lenders thereunder)

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

Commitment

   $      %

Loan:

   $      %

Fees Assigned (if any):

   $      %

 

2

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

The terms set forth above are hereby agreed to:

 

                                         , as Assignor   Accepted*/        
ALCOA INC., by:  

 

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

        Name:             Title:       by:  

 

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

        Name:             Title:                                           
  , as Assignee   JPMORGAN CHASE BANK by:  

 

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

  by:  

 

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

Name:       Name:     Title:       Title:    

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

*/ To be completed to the extent consents are required under Section 10.04(b) of
the Credit Agreement.

 

63

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

EXHIBIT B

TO CREDIT AGREEMENT

 

ADMINISTRATIVE QUESTIONNAIRE

ALCOA INC.

 

Please accurately complete the following information and return via FAX to the
attention of [Bang Tran (713-750-2223)] at JPMorgan Chase Bank as soon as
possible.

 

PHONE NUMBER: FAX NUMBER:

LEGAL NAME OF LENDER (TO APPEAR ON THE SIGNATURE LINE IN DOCUMENTATION):

 

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

GENERAL INFORMATION - DOMESTIC LENDING OFFICE:

Institution Name:                                                 

Street Address:                                                 

City, State, Zip Code:                                                 

GENERAL INFORMATION - LIBOR LENDING OFFICE:

Institution Name:                                                 

Street Address:                                                 

City, State, Zip Code:                                                 

TAX WITHHOLDING:

Non-Resident Alien:            Yes*                 No*

*Form 4224 Enclosed

Tax ID Number:                                                 

CONTACTS/NOTIFICATION METHODS:

CREDIT CONTACTS:

Primary Contact:                                                 

Street Address:                                                 

City, State, Zip Code:                                                 

Phone Number:                                                 

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

FAX Number:                                                 

Backup Contact:                                                 

Street Address:                                                 

City, State, Zip Code:                                                 

Phone Number:                                                 

FAX Number:                                                 

ADMINISTRATIVE CONTACTS - BORROWING, PAYMENTS, INTEREST, ETC

Contact(s):                                                 

Street Address:                                                 

City, State, Zip Code:                                                 

Phone Number:                                                 

FAX Number:                                                 

ACCOUNT INFORMATION - Please provide only one set of instructions for all types
of payments:

Name of Bank where funds are to be transferred:

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

Routing Transit/ABA number of Bank where funds are to be transferred:

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

Name of Account:                                                 

Account Number:                                                 

Additional Information:                                                 

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

 

It is very important that all of the above information is accurately filled in
and promptly returned. If there is someone other than yourself who should
receive this questionnaire, please notify us of their name and FAX number and we
will FAX them a copy of the questionnaire.

 

2

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

EXHIBIT C

TO CREDIT AGREEMENT

 

[Letterhead of]

 

ALCOA

 

April 23, 2004

 

JPMorgan Chase Bank, as Agent

and each of the Lenders party to the

Agreement referred to below

270 Park Avenue

New York, NY 10017

 

Ladies and Gentlemen:

 

I am Counsel of Alcoa Inc. (“Alcoa”) and in such capacity have represented Alcoa
in connection with the Five-Year Revolving Credit Agreement dated as of April
23, 2004 (the “Agreement”), among Alcoa, certain subsidiaries of Alcoa, the
Lenders and JPMorgan Chase Bank, as the Administrative Agent. This opinion is
rendered to you pursuant to Section 4.01(a) of the Agreement. Capitalized terms
used but not defined herein shall have the meanings assigned to them in the
Agreement.

 

In rendering the opinion expressed below, I have examined, either personally or
indirectly through other counsel, the originals or conformed copies of the
Agreement and such corporate records, agreements and instruments of Alcoa and
its Subsidiaries, certificates of public officials and of officers of Alcoa and
its Subsidiaries, and such other documents and records as I have deemed
appropriate as a basis for the opinions hereinafter expressed.

 

Based upon the foregoing and subject to the qualifications stated herein, I am
of the opinion that:

 

1. Alcoa is a corporation duly organized, validly existing and in good standing
under the laws of the Commonwealth of Pennsylvania and is duly qualified to do
business as a foreign corporation and is in good standing in all other
jurisdictions in which the ownership of its properties or the nature of its
activities or both makes such qualification necessary, except to the extent that
failure to be so qualified would not result in a Material Adverse Effect.

 

2. Alcoa has corporate power and authority to execute, deliver and carry out the
provisions of the Agreement, to borrow under the Agreement and to perform its
obligations thereunder and all such action has been duly and validly authorized
by all necessary corporate proceedings on its part.

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

3. The Agreement has been duly executed and delivered by Alcoa and constitutes
the legal, valid and binding obligation of Alcoa enforceable against Alcoa in
accordance with its terms, except as limited by bankruptcy, insolvency or other
similar laws of general application affecting the enforcement of creditors’
rights or by general principles of equity limiting the availability of equitable
remedies.

 

4. No authorization, consent, approval, license, exemption or other action by,
and no registration, qualification, designation, declaration or filing with, any
Governmental Authority is necessary in connection with Alcoa’s execution and
delivery of the Agreement, the consummation by Alcoa of the transactions
contemplated therein or Alcoa’s performance of or compliance with the terms and
conditions thereof, except as set forth on Schedule 3.04 to the Agreement.

 

5. The execution and delivery by Alcoa of the Agreement, the consummation by
Alcoa of the transactions contemplated thereby or performance by Alcoa of or
compliance with the terms and conditions thereof will not (a) violate any law,
constitution, statute, treaty, regulation, rule, ordinance, order, injunction,
writ, decree or award of any Governmental Authority to which it is subject, (b)
conflict with or result in a breach or default under its charter or by-laws, (c)
to the best of my knowledge, conflict with or result in a breach or default
which is material in the context of the Agreement under any agreement or
instrument to which Alcoa is a party or by which it or any of its properties,
whether now owned or hereafter acquired, may be subject or bound or (d) result
in the creation or imposition of any Lien prohibited by Section 6.01 of the
Agreement upon any property or assets of Alcoa, whether now owned or hereafter
acquired.

 

6. Except as set forth in the financial statements referred to in Section 3.06
of the Agreement, the Exchange Act Report or otherwise disclosed on Schedule
3.08 to the Agreement, there is no pending or, to my knowledge, threatened
proceeding by or before any Governmental Authority against Alcoa or any of its
Subsidiaries which in my opinion is likely to result in a Material Adverse
Effect.

 

7. Alcoa is not an “investment company” as defined in, or subject to regulation
under, the Investment Company Act of 1940, and Alcoa is exempted as a “holding
company” as defined in the Public Utility Holding Company Act of 1935.

 

I am a member of the bar of the Commonwealth of Pennsylvania and my opinion is
limited to the laws of the Commonwealth of Pennsylvania and the laws of the
United States of America. I express no opinion herein as to whether a court
would apply New York law to any particular subject matter hereof. To the extent
that the laws of the State of New York or, contrary to the agreement of the
parties, the laws of any other State govern the documents referenced herein, you
may rely on my opinion with respect to such laws to the extent that the laws of
such state or states are substantially the same as the laws of the Commonwealth
of Pennsylvania, as to which sameness I express no opinion.

 

Very truly yours,

 

2

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

EXHIBIT D

TO CREDIT AGREEMENT

 

[FORM OF]

 

DESIGNATION OF BORROWING SUBSIDIARY

 

Reference is made to the Five-Year Revolving Credit Agreement dated as of April
23, 2004 (as amended from time to time, the “Credit Agreement”), among Alcoa
Inc. (“Alcoa”), a Pennsylvania corporation, certain subsidiaries of Alcoa, the
Lenders and JPMorgan Chase Bank, as the Administrative Agent for the Lenders.
Terms defined in the Credit Agreement are used herein with the same meanings.

 

1. Alcoa hereby designates [            ], a [            ] corporation (the
“Subsidiary”), effective as of [                    ], 20[    ] (the
“Designation Date”), as a Borrowing Subsidiary under the Credit Agreement. The
Subsidiary hereby makes and agrees to be bound by all the representations,
warranties and agreements set forth in Article III, V and VI of the Credit
Agreement. From and after the Designation Date, the Subsidiary shall become a
party to the Credit Agreement and shall have the rights and obligations of a
Borrowing Subsidiary thereunder. Alcoa agrees that its guarantee pursuant to
Article VIII of the Credit Agreement shall apply to the Borrowings of the
Subsidiary.

 

2. This Designation of Borrowing Subsidiary is being delivered to the
Administrative Agent together with the documents set forth in Section 4.03(a).

 

3. This Designation of Borrowing Subsidiary shall be governed by and construed
in accordance with the laws of the State of New York.

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

The terms set forth above are hereby agreed to:

 

[                     ], as Subsidiary,

by

   

Name:

   

Title:

   

ALCOA INC.,

by

   

Name:

   

Title:

   

 

Accepted:

 

JPMORGAN CHASE BANK, as the Administrative Agent

by

 

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

Name:

Title:

 

2

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

SCHEDULE 2.01

 

FIVE -YEAR REVOLVING CREDIT AGREEMENT

 

Name and Address of

Lenders

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

  

Title

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

  

Contact Person

And Telephone And

Facsimile Numbers

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

   Commitment (U.S.$)

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

JPMorgan Chase Bank

270 Park Avenue

New York, NY 10017

  

Administrative Agent

  

James Ramage

Tel: 212-270-1373

Fax: 212-270-4724

   $ 50,833,329

ABN AMRO Bank, N.V.

135 South LaSalle Street,

Ste 710

Chicago, Illinois 60603

  

Documentation Agent

  

Stephanie Casas

Tel: 832-681-7186

Fax: 832-681-7141

     100,000,001

Deutsche Bank AG

60 Wall Street – NYC60-1101

New York, NY 10005

  

Documentation Agent

  

Oliver Schwarz

Tel: 212-250-8610

Fax: 212-797-4421

     100,000,001

Credit Suisse First Boston

One First Canada Place

Toronto M5X1C Canada

  

Syndication Agent

  

Alain Daoust

Tel: 416-325-4527

Fax: 416-352-4576

     91,666,667

Citibank, N.A.

388 Greenwich Street, 21st Fl.

New York, NY 10013

  

Syndication Agent

  

Daniel Miller

Tel: 212-816-8283

Fax: 212-816-8051

     83,333,334

UBS AG, Stamford Branch

677 Washington Boulevard

Stamford, Connecticut 06901

  

Syndication Agent

  

Denise Conzo

Tel: 203-719-3853

Fax: 203-719-3888

     83,333,334

Barclays Bank

200 Park Avenue

New York, NY 10166

       

Jonathan Burn

Tel: 212-412-1488

Fax: 212-412-2441

     133,333,333

Mellon Bank, N.A.

One Mellon Bank Center

Pittsburgh, PA 15258-0001

       

Robert Reichenbach

Tel: 412-236-0567

Fax: 412-236-1914

     58,333,333

The Bank of Tokyo-

Mitsubishi, Ltd.,

New York Branch

1251 Avenue of the Americas

New York, NY 10022

       

Mark Marron

Tel: 212-782-4337

Fax: 212-782-6440

     66,666,667

Australian and New Zealand

Banking Group Ltd.

1177 Avenue of the Americas

New York, NY 10036

       

David Giacalone

Tel: 212-801-9894

Fax: 212-536-9294

     52,500,000

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

Lehman Brothers

745 Seventh Avenue, 3rd Fl.

New York, NY 10019

      

Alan Cutler

Tel: 212-526-3399

Fax: 212-646-4933

   66,666,667

Morgan Stanley Bank

1585 Broadway

New York, 10036

      

Mark Tashkovich

Tel: 212-761-2223

Fax: 212-507-4242

   41,666,667

Bank of America, N.A.

901 Main Street, 67th Fl.

Dallas, TX 75202

      

Steve Aronowitz

Tel: 212-503-7950

Fax: 212-503-7066

   16,666,667

BNP Paribas

787 Seventh Avenue

New York, NY 10019

      

Robert Munczinski

Tel: 212-841-2632

Fax: 212-415-9822

   16,666,667

Royal Bank of Canada

One Liberty Plaza

165 Broadway

New York, NY 10006-1404

      

Patrick Shields

Tel: 212-428-2322

Fax: 212-428-6459

   33,333,333

SANPAOLO IMI S.P.A.

245 Park Avenue, 35th Fl.

New York, NY 10167

      

Luca Sacchi

Tel: 212-692-3130

Fax: 212-692-3178

   5,000,000         

Total:

   1,000,000,000              

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

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

SCHEDULE 3.04

 

Governmental Approvals

 

International Capital Form S filed with the Federal Reserve Bank of New York.

 

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

SCHEDULE 3.08

 

Litigation

 

None.

 

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

SCHEDULE 6.01(a)

 

Liens

 

ENTITY

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

   LEASED
EQUIPMENT

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

   MORTGAGES

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

   OTHER LIENS
ON PERSONAL
PROPERTY*

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

   ACCOUNTS
RECEIVABLE
SECURITIZATIONS**

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

   TAX EXEMPT
REVENUE BOND
FINANCINGS***

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

Alcoa Inc. - Consolidated

     1,410,400      125,000                             1,524,611              
                            1,025,430                                          
              38,630,000

Reynolds Metals Company

     1,525,253      89,035                     

Alcoa Architectural Products SAS

            11,337,933                     

Reynolds Systems Ireland Limited

     200,689                            

Reynolds Wheels Virginia International, Ltd.

                   494,000              

Automotive Castings

            11,494                     

Alcoa Manufacturing (GB) Limited

     9,575                                    60,998,365                        
   

Kawneer U.K. Ltd

     80,055      42,630                     

Alcoa Building Products (ABP)

     70,261      410,618                     

Eastalco Aluminum Company

                                 9,880,000

Kawneer Co., Inc.

            12,793                             940,238      826,558            
        

Baco Consumer Products Limited

            22,253                     

Huck S.A.

            189,378                     

Alcoa Inespal, S.A.

     28,467      6,818                                    52,053              
              10,188                            

Alcoa World Alumina LLC

            186,079                     

Alcoa Chemie GMBH

     529,643                            

Alcoa Shanghai Aluminum Products

            6,303,204                     

Alcoa Kofem Kft

            4                     

Alcoa Closure Systems Japan, Ltd.

     1,804,241                    16,307,737       

Alumax Europe N.V.

            480,357                     

Alumax Mill Products, Inc. (Texarkana)

     138,870,450                            

Alcoa Servicios, SA de CV

     51,028                            

Alcoa Wireless Network Services Inc.

            131,063                     

Alcoa Inter-America, Inc.

                          100,000,000            

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     $ 208,053,464    $ 21,252,700    $ 494,000    $ 116,307,737    $ 48,510,000
    

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* Relates to economic development loan entered into by Reynolds Wheels Virginia
International, Inc.

** Fluctuating balance not to exceed the maximum U.S. dollar amount indicated.

*** Excludes bonds redeemed, defeased or paid off after December 31, 2003 and
prior to the Effective Date of the Credit Agreement.