exv4w1



 





Exhibit 4.1




EXECUTION VERSION





 





$300,000,000


SECOND AMENDED AND RESTATED CREDIT AGREEMENT


Dated as of June 29, 2007


 




Among


CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC,


as Borrower,


THE BANKS PARTIES HERETO,


BARCLAYS BANK PLC and

WACHOVIA BANK, NATIONAL ASSOCIATION,


as Co-Syndication Agents,


UBS SECURITIES LLC and

DEUTSCHE BANK SECURITIES INC.,

as Co-Documentation Agents

and


JPMORGAN CHASE BANK, N.A.,

as Administrative Agent


 




BARCLAYS CAPITAL and

WACHOVIA BANK, NATIONAL ASSOCIATION,


as Joint Lead Arrangers and Bookrunners



 





 









 





Table of Contents




	 	 	 	 	 
	 	 	Page
	ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
	 	 	1	 
	SECTION 1.1. Certain Defined Terms
	 	 	1	 
	SECTION 1.2. Other Definitional Provisions
	 	 	22	 
	 
	 	 	 	 
	ARTICLE II AMOUNTS AND TERMS OF THE LOANS AND LETTERS OF CREDIT
	 	 	22	 
	SECTION 2.1. The Commitments
	 	 	22	 
	SECTION 2.2. Procedure for Revolving Loan Borrowing
	 	 	23	 
	SECTION 2.3. Minimum Tranches
	 	 	24	 
	SECTION 2.4. Swingline Loans
	 	 	24	 
	SECTION 2.5. Letters of Credit
	 	 	26	 
	SECTION 2.6. Increase in the Aggregate Commitments
	 	 	30	 
	SECTION 2.7. Extension Option
	 	 	32	 
	 
	 	 	 	 
	ARTICLE III PROVISIONS RELATING TO ALL LOANS
	 	 	32	 
	SECTION 3.1. Evidence of Loans
	 	 	32	 
	SECTION 3.2. Fees
	 	 	33	 
	SECTION 3.3. Interest
	 	 	33	 
	SECTION 3.4. Reserve Requirements
	 	 	34	 
	SECTION 3.5. Interest Rate Determination and Protection
	 	 	35	 
	SECTION 3.6. Voluntary Interest Conversion or Continuation of Loans
	 	 	35	 
	SECTION 3.7. Funding Losses Relating to LIBOR Rate Loans
	 	 	36	 
	SECTION 3.8. Change in Legality
	 	 	37	 
	 
	 	 	 	 
	ARTICLE IV INCREASED COSTS, TAXES, PAYMENTS AND PREPAYMENTS
	 	 	38	 
	SECTION 4.1. Increased Costs; Capital Adequacy
	 	 	38	 
	SECTION 4.2. Pro Rata Treatment and Payments and Computations
	 	 	39	 
	SECTION 4.3. Taxes
	 	 	40	 
	SECTION 4.4. Sharing of Payments, Etc
	 	 	42	 
	SECTION 4.5. Optional Termination or Reduction of the Commitments
	 	 	42	 
	SECTION 4.6. Voluntary Prepayments
	 	 	43	 
	SECTION 4.7. Mitigation of Losses and Costs
	 	 	43	 
	SECTION 4.8. Determination and Notice of Additional Costs and Other Amounts
	 	 	43	 
	 
	 	 	 	 
	ARTICLE V CONDITIONS OF LENDING
	 	 	44	 
	SECTION 5.1. Conditions Precedent to Loans and Letters of Credit
	 	 	44	 
	SECTION 5.2. Conditions Precedent to Each Borrowing
	 	 	45	 
	 
	 	 	 	 
	ARTICLE VI REPRESENTATIONS AND WARRANTIES
	 	 	46	 
	SECTION 6.1. Representations and Warranties of the Borrower
	 	 	46	 
	 
	 	 	 	 
	ARTICLE VII AFFIRMATIVE AND NEGATIVE COVENANTS
	 	 	49	 
	SECTION 7.1. Affirmative Covenants
	 	 	49	 
	SECTION 7.2. Negative Covenants
	 	 	53	 






i









 






	 	 	 	 	 
	 	 	Page
	ARTICLE VIII EVENTS OF DEFAULT
	 	 	56	 
	SECTION 8.1. Events of Default
	 	 	56	 
	SECTION 8.2. Cancellation/Acceleration
	 	 	58	 
	 
	 	 	 	 
	ARTICLE IX THE ADMINISTRATIVE AGENT
	 	 	60	 
	SECTION 9.1. Appointment
	 	 	60	 
	SECTION 9.2. Delegation of Duties
	 	 	60	 
	SECTION 9.3. Exculpatory Provisions
	 	 	60	 
	SECTION 9.4. Reliance by Administrative Agent
	 	 	60	 
	SECTION 9.5. Notice of Default
	 	 	61	 
	SECTION 9.6. Non-Reliance on Administrative Agent and Other Banks
	 	 	61	 
	SECTION 9.7. Indemnification
	 	 	62	 
	SECTION 9.8. Agent in Its Individual Capacity
	 	 	62	 
	SECTION 9.9. Successor Administrative Agent
	 	 	62	 
	 
	 	 	 	 
	ARTICLE X MISCELLANEOUS
	 	 	63	 
	SECTION 10.1. Amendments and Waivers
	 	 	63	 
	SECTION 10.2. Notices
	 	 	64	 
	SECTION 10.3. No Waiver; Cumulative Remedies
	 	 	66	 
	SECTION 10.4. Survival of Representations and Warranties
	 	 	66	 
	SECTION 10.5. Payment of Expenses and Taxes; Indemnity
	 	 	66	 
	SECTION 10.6. Effectiveness, Successors and Assigns, Participations; Assignments
	 	 	67	 
	SECTION 10.7. Setoff
	 	 	70	 
	SECTION 10.8. Counterparts
	 	 	70	 
	SECTION 10.9. Severability
	 	 	70	 
	SECTION 10.10. Integration
	 	 	71	 
	SECTION 10.11. GOVERNING LAW
	 	 	71	 
	SECTION 10.12. Submission to Jurisdiction; Waivers
	 	 	71	 
	SECTION 10.13. Acknowledgments
	 	 	72	 
	SECTION 10.14. Limitation on Agreements
	 	 	72	 
	SECTION 10.15. Removal of Bank
	 	 	73	 
	SECTION 10.16. Officer’s Certificates
	 	 	73	 
	SECTION 10.17. USA Patriot Act
	 	 	73	 






ii









 





	 	 	 	 	 
	Schedules	 	 	 	 
	 
	 	 	 	 
	Schedule 1.1(A)

	 	-
	 	Schedule of Commitments and Addresses
	Schedule 1.1(B)

	 	-
	 	Existing Letters of Credit
	Schedule 6.1(p)

	 	-
	 	Ownership of Capital Stock of Subsidiaries; Significant Subsidiaries






	 	 	 	 	 
	Exhibits	 	 	 	 
	 
	 	 	 	 
	Exhibit A

	 	-
	 	Notice of Borrowing
	Exhibit B

	 	-
	 	Notice of Interest Conversion/Continuation
	Exhibit C

	 	-
	 	Assignment and Acceptance
	Exhibit D-1

	 	-
	 	Note
	Exhibit D-2

	 	-
	 	Swingline Note
	Exhibit E

	 	-
	 	Assumption Agreement






iii









 





          This Second Amended and Restated Credit Agreement (this “Agreement”), dated as of June
29, 2007, among CenterPoint Energy Houston Electric, LLC, a Texas limited liability company (the
“Borrower”), the banks and other financial institutions from time to time parties hereto
(individually, a “Bank” and, collectively, the “Banks”), Barclays Bank PLC and
Wachovia Bank, National Association, as co-syndication agents (in such capacities, the
“Syndication Agents”), UBS Securities LLC and Deutsche Bank Securities Inc., as
co-documentation agents (in such capacity, the “Documentation Agents”) and JPMorgan Chase
Bank, N.A., as administrative agent (in such capacity, together with any successors thereto in such
capacity, the “Administrative Agent”).




W I T N E S S E T H




          WHEREAS, the Borrower entered into that certain Existing Credit Agreement (as defined below);
and




          WHEREAS, the Borrower has requested that the Existing Credit Agreement be amended and restated
in its entirety as provided herein;




          NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the
parties hereto agree that on the Closing Date, the Existing Credit Agreement shall be, and hereby
is, amended and restated in its entirety as follows:




ARTICLE I




DEFINITIONS AND ACCOUNTING TERMS




     SECTION
1.1. Certain Defined Terms. As used in this Agreement, the following terms shall have the
following meanings:




     “ABR” means for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/64 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and
(b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes
hereof, “Prime Rate” means the rate of per annum publicly announced from time to
time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its principal office in New
York City (the Prime Rate not being intended to be the lowest rate of interest charged by
JPMorgan Chase Bank, N.A. in connection with extensions of credit to debtors). Any change
in the ABR due to a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective as of the opening of business on the effective day of such change in the Prime
Rate or the Federal Funds Effective Rate, respectively.




     “ABR Loan” means a Loan that bears interest at the ABR as provided in Section
3.3.




     “Administrative Agent” has the meaning specified in the introduction to this
Agreement.



 









 






     “Affiliate” means any Person that, directly or indirectly, Controls or is
Controlled by or is under common Control with another Person.




     “Agents” means the collective reference to the Syndication Agent, the
Documentation Agents and the Administrative Agent.




     “Agreement” has the meaning specified in the introduction to this Agreement.




     “Applicable Margin” means the rate per annum set forth below opposite the
Designated Rating from time to time in effect during the period for which payment is due:



	 	 	 	 	 
	Designated
	 	LIBOR Rate	 	 
	Rating
	 	Margin
	 	ABR Margin
	 
	 	 
	 	 
	Higher than BBB+/Baa1/BBB+
	 	0.25%
	 	0.00%
	BBB+/Baa1/BBB+
	 	0.35%
	 	0.00%
	BBB/Baa2/BBB
	 	0.45%
	 	0.00%
	BBB-/Baa3/BBB-
	 	0.55%
	 	0.00%
	BB+/Ba1/BB+
	 	0.70%
	 	0.00%
	Lower than BB+/Ba1/BB+
	 	1.00%
	 	0.00%







The Designated Ratings referred to above are issued by S&P, Moody’s and Fitch,
respectively.




     “Application” means an application, in such form as an Issuing Bank may specify
from time to time, requesting such Issuing Bank to issue a Letter of Credit.




     “Assignment and Acceptance” has the meaning specified in Section 10.6(c).




     “Assuming Bank” has the meaning specified in Section 2.6(d).




     “Assumption Agreement” has the meaning specified in Section 2.6(d).




     “Available Commitment” means, as to any Bank at any time, an amount equal to
the excess, if any, of (a) such Bank’s Commitment then in effect over (b) such
Bank’s Outstanding Extensions of Credit then outstanding; provided, that in
calculating any Bank’s Outstanding Extensions of Credit for the purpose of determining such
Bank’s Available Commitment pursuant to Section 3.2, the aggregate principal amount of
Swingline Loans then outstanding shall be deemed to be zero.




     “Bank” and “Banks” have the meanings specified in the introduction to
this Agreement. Unless the context otherwise requires, the term “Banks” includes the
Swingline Lender.




     “Bank Affiliate” means, (a) with respect to any Bank, (i) an Affiliate of such
Bank that is a bank or (ii) any entity (whether a corporation, partnership, trust or



2









 






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 Bank or an Affiliate of such Bank and (b) with respect to any
Bank 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 such
Bank, an Affiliate of such Bank or the same investment advisor as such Bank or by an
Affiliate of such investment advisor.




     “Board” means the Board of Governors of the Federal Reserve System of the
United States (or any successor thereto).




     “Borrowed Money” of any Person means any Indebtedness of such Person for or in
respect of money borrowed or raised by whatever means (including acceptances, deposits,
lease obligations under Capital Leases, Mandatory Payment Preferred Stock and synthetic
leases); provided, however, that Borrowed Money shall not include (a) any
guarantees that may be incurred by endorsement of negotiable instruments for deposit or
collection in the ordinary course of business or similar transactions, (b) any obligations
or guarantees of performance of obligations under a franchise, performance bonds, franchise
bonds, obligations to reimburse drawings under letters of credit issued in accordance with
the terms of any safe harbor lease or franchise or in lieu of performance or franchise bonds
or other obligations that do not represent money borrowed or raised, in each case to the
extent that such reimbursement obligations are payable in full within ten (10) Business Days
after the date upon which such obligation arises, (c) trade payables, (d) any obligations of
such Person under Swap Agreements, (e) customer advance payments and deposits arising in the
ordinary course of business or (f) operating leases.




     “Borrower” has the meaning specified in the introduction to this Agreement.




     “Borrowing” means a borrowing consisting of Loans under Section 2.1 (or
Swingline Loans made pursuant to Section 2.4) of the same Type, and having, in the case of
LIBOR Rate Loans, the same Interest Period, made on the same day by the Banks.




     “Borrowing Date” means any Business Day specified by the Borrower as a date on
which the Borrower requests the Banks to make Loans hereunder.




     “Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close;
provided that when used in connection with a LIBOR Rate Loan, the term “Business
Day” shall also exclude any day on which commercial banks are not open for dealings in
Dollar deposits in the London interbank market.




     “Capital Lease” means a lease that, in accordance with GAAP, would be recorded
as a capital lease on the balance sheet of the lessee.




     “Capital Stock” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, and any and all
equivalent ownership interests in a Person (other than a corporation), including
without limitation, partnership interests in partnerships and member interests in limited
liability



3









 






companies, and any and all warrants or options to purchase any of the foregoing or
securities convertible into any of the foregoing.




     “CenterPoint” means CenterPoint Energy, Inc., a Texas corporation and utility
holding company, and the indirect parent of the Borrower.




     “CenterPoint Facility” means the $1,200,000,000 Second Amended and Restated
Credit Agreement, dated as of the date hereof, among CenterPoint, JPMorgan Chase Bank, N.A.,
as administrative agent, and the other financial institutions and agents parties thereto, as
amended, modified or supplemented from time to time.




     “Change in Control” means (i) with respect to CenterPoint, the acquisition by
any Person or “group” (within the meaning of Rule 13d-5 of the Exchange Act) of beneficial
ownership (determined in accordance with Rule 13d-3 of the Exchange Act) of Capital Stock of
CenterPoint, the result of which is that such Person or group beneficially owns 50% or more
of the aggregate voting power of all then issued and outstanding Capital Stock of
CenterPoint or (ii) CenterPoint shall cease to own and control beneficially, directly or
indirectly, 100% of the outstanding common Capital Stock of the Borrower free and clear of
all Liens. For purposes of the foregoing, the phrase “voting power” means, with respect to
an issuer, the power under ordinary circumstances to vote for the election of members of the
board of directors or other governing body of such issuer.




     “Closing Date” means the date, on or before July 31, 2007, all the conditions
set forth in Section 6.1 are satisfied (or waived) in accordance with the terms hereof.




     “Code” means the Internal Revenue Code of 1986, as amended from time to time,
and any successor statute.




     “Commitment” means, as to any Bank, the obligation of such Bank, if any, to
make Loans and participate in L/C Obligations and Swingline Loans in an aggregate principal
and/or face amount not to exceed the amount set forth under the heading “Commitment”
opposite such Bank’s name on Schedule 1.1(A) and/or in the Assignment and Acceptance
pursuant to which such Bank became a party hereto, as the same may be changed from time to
time pursuant to the terms hereof, including, without limitation, the terms of Section 2.6
and Section 4.5; and “Commitments” shall be the collective reference to the Commitments of
all of the Banks. The original amount of the Total Commitments is $300,000,000.




     “Commitment Date” has the meaning specified in Section 2.6(b).




     “Commitment Fee” means, as to any Bank, the fee equal to the rate per annum set
forth below opposite the Designated Rating from time to time in effect during the period for
which payment is due on the Available Commitment of such Bank:



	 	 	 
	Designated	 	 
	Rating 	 	Commitment Fee
	Higher than BBB+/Baa1/BBB+
	 	0.06%
	BBB+/Baa1/BBB+
	 	0.07%
	BBB/Baa2/BBB
	 	0.09%
	BBB-/Baa3/BBB-
	 	0.125%
	BB+/Ba1/BB+
	 	0.175%
	Lower than BB+/Ba1/BB+
	 	0.20%






4









 






The Designated Ratings referred to above are issued by S&P, Moody’s and Fitch,
respectively.




     “Commitment Increase” has the meaning specified in Section 2.6(a).




     “Commonly Controlled Entity” means an entity, whether or not incorporated, that
is under common control with the Borrower within the meaning of Section 4001 of ERISA or is
part of a group that includes the Borrower and that is treated as a single employer under
Section 414 of the Code.




     “Communications” has the meaning specified in Section 10.2(b).




     “Confidential Information Memorandum” means the Confidential Information
Memorandum, dated May 2007.




     “Consolidated Capitalization” means, as of any date of determination, the sum
of (a) Consolidated Shareholders’ Equity, (b) Consolidated Indebtedness for Borrowed Money
and, without duplication, (c) Mandatory Payment Preferred Stock; provided that for
the purpose of calculating compliance with Section 7.2(a), Consolidated Capitalization shall
be determined excluding any adjustment, non-cash charge to net income or other non-cash
charges or writeoffs resulting thereto from application of SFAS No. 142.




     “Consolidated Indebtedness” means, as of any date of determination, the sum of




     (i) the total Indebtedness for Borrowed Money of the Borrower and its
Consolidated Subsidiaries as shown on the consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries, determined without duplication of any Guarantee
of Indebtedness of the Borrower by any of its Consolidated Subsidiaries or of any
Guarantee of Indebtedness of any such Consolidated Subsidiary by the Borrower or any
other Consolidated Subsidiary of the Borrower, plus




     (ii) any Mandatory Payment Preferred Stock, less




     (iii) the amount of Indebtedness described in clause (i) attributable to
amounts then outstanding under receivables facilities or arrangements to the



5









 






extent that such amounts would not have been shown as Indebtedness on a balance
sheet prepared in accordance with GAAP prior to January 1, 1997, less



                    (iv) Non-Recourse Debt.




     “Consolidated Shareholders’ Equity” means, as of any date of determination, the
total assets of the Borrower and its Consolidated Subsidiaries, less all liabilities of the
Borrower and its Consolidated Subsidiaries. As used in this definition, “liabilities” means
all obligations that, in accordance with GAAP consistently applied, would be classified on a
balance sheet as liabilities (including without limitation (to the extent so classified),
(a) Indebtedness; (b) deferred liabilities; and (c) Indebtedness of the Borrower or any of
its Consolidated Subsidiaries that is expressly subordinated in right and priority of
payment to other liabilities of the Borrower or such Consolidated Subsidiary, but in any
case excluding as at such date of determination any Junior Subordinated Debt owned by any
issuer of Hybrid Equity Securities.




     “Consolidated Subsidiary” means, with respect to a specified Person at any
date, any Subsidiary or any other Person (other than with respect to the Borrower, any
Securitization Subsidiary or any Unrestricted Subsidiary), the accounts of which under GAAP
would be consolidated with those of such specified Person in its consolidated financial
statements as of such date.




     “Contractual Obligation” means, as to any Person, any provision of any security
issued by such Person or of any written agreement, instrument or other written undertaking
to which such Person is a party or by which it or any of its property is bound.




     “Controlled” means, with respect to any Person, the ability of another Person
(whether directly or indirectly and whether by the ownership of voting securities, contract
or otherwise) to appoint and/or remove the majority of the members of the board of directors
or other governing body of that Person (and “Control” shall be similarly construed).




     “CTC Recoveries” means the principal balance remaining to be collected from
retail electric providers in respect of stranded costs and certain power market price and
fuel cost recovery true-ups.




     “Declining Lender” has the meaning specified in Section 2.7.




     “Default” means any event that, with the lapse of time or giving of notice, or
both, or any other condition, would constitute an Event of Default.




     “Default Rate” means with respect to any overdue amount owed hereunder, a rate
per annum equal to (a) in the case of overdue principal with respect to any Loan, the sum of
the interest rate in effect at such time with respect to such Loan under Section 3.3, plus
2%; provided that in the case of overdue principal with respect to any LIBOR Rate
Loan, after the end of the Interest Period with respect to such Loan, the Default Rate shall
equal the rate set forth in clause (c) below, (b) in the case of overdue principal with
respect to any Reimbursement Obligations, the sum of the interest rate per annum in effect
at such



6









 






time with respect to ABR Loans under Section 3.3, plus 2%, and (c) in the case of
overdue interest with respect to any Loan, Commitment Fees, Utilization Fees or other
amounts payable hereunder, the sum of the interest rate per annum in effect at such time
with respect to ABR Loans, plus 2%.




     “Designated Rating” means (a) if the Ratings are split and all three Ratings
fall in different levels, the level indicated by the middle Rating; (b) if the Ratings are
split and two of the Ratings fall in the same level (the “Majority Level”) and the
third Rating is in a different level, the Majority Level; (c) if only two of the Rating
Agencies issue a Rating, the higher of such Ratings, provided that if the higher
Rating is two or more levels above the lower Rating, the rating next above the lower of the
two Ratings shall be the Designated Rating; and (d) if only one Rating Agency issues a
Rating, such Rating. Any change in the calculation of the Applicable Margin with respect to
the Borrower that is caused by a change in the Designated Rating will become effective on
the date of the change in the Designated Rating. If the rating system of any Rating Agency
shall change, or if any of S&P, Moody’s or Fitch shall cease to be in the business of rating
corporate debt obligations, the Borrower and the Administrative Agent shall negotiate in
good faith if necessary to amend this definition and the definitions of “Rating” and “Rating
Agencies” to reflect such changed rating system or the unavailability of Ratings from such
Rating Agencies and, pending the effectiveness of any such amendment, the Designated Rating
shall be determined by reference to the Rating most recently in effect prior to such change
or cessation.




     “Disposition” means with respect to any Property (excluding cash and cash
equivalents), any sale, lease, sale and leaseback, assignment, conveyance, transfer or other
disposition thereof outside the ordinary course of business. The terms “Dispose”
and “Disposed of” shall have correlative meanings.




     “Documentation Agents” has the meaning specified in the introduction to this
Agreement.




     “Dollars” and the symbol “$” mean the lawful currency of the United
States.




     “Early Funding ABR Loan” has the meaning specified in Section 2.2(a).




     “Eligible Assignee” means (i) a Bank; (ii) an Affiliate of a Bank; and (iii)
any other financial institution that is a “qualified purchaser” as defined under the
Investment Company Act of 1940 and is approved by the Administrative Agent, each Issuing
Bank and, unless an Event of Default has occurred and is continuing at the time any
assignment is effected in accordance with Section 10.6, the Borrower, such approval not to
be unreasonably withheld or delayed.




     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.




     “Event of Default” has the meaning specified in Section 8.1.




     “Exchange Act” means the Securities Exchange Act of 1934, as amended.



7









 






     “Existing Credit Agreement” means the $300,000,000 Amended and Restated Credit
Agreement, dated as of March 31, 2006, among the Borrower, as borrower, JPMorgan Chase Bank,
N.A., as administrative agent, and the other financial institutions and agents parties
thereto, as heretofore amended, modified or supplemented from time to time.




     “Existing Credit Facility” means the credit facility provided under the
Existing Credit Agreement.




     “Existing Issuing Banks” means each of JPMorgan Chase Bank, N.A. and Citibank,
N.A., in their respective capacities as issuers of the Existing Letters of Credit.



          “Existing Letters of Credit” means the letters of credit issued under the Existing
Credit Facility described on Schedule 1.1(B).





     “Extended Termination Date” has the meaning specified in Section 2.7.




     “Extending Lender” has the meaning specified in Section 2.7.




     “Facility” means the Commitments and the extensions of credit made thereunder.




     “Federal Funds Effective Rate” means, for any day, a fluctuating rate per annum
equal to the weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, 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 that is a Business Day, the average of the quotations for such
day for such transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by the Borrower.




     “Fitch” means Fitch Ratings and any successor rating agency.




     “Funding Office” means the office of the Administrative Agent specified in
Section 10.2(a) or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and the Banks.




     “GAAP” means generally accepted accounting principles in effect from time to
time in the United States of America.




     “General Mortgage Indenture” means the General Mortgage Indenture, dated as of
October 10, 2002, between the Borrower and The Bank of New York Trust Company, N.A. (as
successor to JPMorgan Chase Bank), as trustee, as amended, modified or supplemented from
time to time.




     “Global Coordinators” means J.P. Morgan Securities Inc. and Citigroup Global
Markets Inc., in their capacities as global coordinators.



8









 






     “Governmental Authority” means any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.




     “Guarantee” means, as to any Person (the “guaranteeing person”), any
obligation of (a) the guaranteeing Person or (b) another Person (including, without
limitation, any bank under any letter of credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counterindemnity or similar obligation, in
either case guaranteeing or in effect guaranteeing any principal of any Indebtedness for
Borrowed Money (the “primary obligation”) of any other third Person in any manner,
whether directly or indirectly, including, without limitation, any obligation of the
guaranteeing Person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to advance or supply
funds for the purchase or payment of any such primary obligation or (iii) otherwise to
assure or hold harmless the owner of any such primary obligation against loss in respect
thereof. The amount of any Guarantee of any guaranteeing person shall be deemed to be the
lower of (a) an amount equal to the stated or determinable amount of the primary obligation
in respect of which such Guarantee is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument embodying such
Guarantee, unless such primary obligation and the maximum amount for which such guaranteeing
person may be liable are not stated or determinable, in which case the amount of such
Guarantee shall be such guaranteeing person’s maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith (and “guaranteed” and
“guarantor” shall be construed accordingly).




     “Highest Lawful Rate” means, with respect to each Bank, the maximum nonusurious
interest rate, if any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received with respect to any Loan or on other amounts, if any, due to
such Bank pursuant to this Agreement or any other Loan Document under applicable law.
“Applicable law” as used in this definition means, with respect to each Bank, that law in
effect from time to time that permits the charging and collection by such Bank of the
highest permissible lawful, nonusurious rate of interest on the transactions herein
contemplated including, without limitation, the laws of each State that may be held to be
applicable, and of the United States, if applicable.




     “Hybrid Equity Securities” means, on any date (the “determination date”), any
securities issued by the Borrower or a Restricted Subsidiary, other than common stock, that
meet the following criteria: (a) the Borrower demonstrates that such securities are
classified, at the time they are issued, as possessing a minimum of “intermediate equity
content” by S&P and “Basket C equity credit” by Moody’s (or the equivalent classifications
then in effect by such agencies) and (b) such securities require no repayments or
prepayments and no mandatory redemptions or repurchases, in each case, prior to at least 91
days after the later of the termination of the Commitments and the repayment in full of the
Obligations. As used in this definition, “mandatory redemption” shall not include
conversion of a security into common stock.




     “Increase Date” has the meaning specified in Section 2.6(a).



9









 






     “Increasing Bank” has the meaning specified in Section 2.6(b).




     “Indebtedness” of any Person means the sum of (a) all items (other than Capital
Stock, capital surplus, retained earnings, other comprehensive income, treasury stock and
any other items that would properly be included in shareholder equity) that, in accordance
with GAAP consistently applied, would be included in determining total liabilities as shown
on the liability side of a balance sheet of such Person as at the date on which the
Indebtedness is to be determined, (b) all obligations of such Person, contingent or
otherwise, as account party or applicant (or equivalent status) in respect of any standby
letters of credit or equivalent instruments, and (c) without duplication, the amount of
Guarantees by such Person of items described in clauses (a) and (b); provided,
however, that Indebtedness of a Person shall not include (i) any Junior Subordinated
Debt owned by any issuer of Hybrid Equity Securities, (ii) any Guarantee by the Borrower or
its Subsidiaries of payments with respect to any Hybrid Equity Securities, (iii) any
Securitization Securities or (iv) any Hybrid Equity Securities.




     “Insolvency” means, with respect to any Multiemployer Plan, the condition that
such Plan is insolvent within the meaning of Section 4245 of ERISA (and “Insolvent” shall be
construed accordingly for such purposes).




     “Interest Period” means, for each LIBOR Rate Loan comprising part of the same
Borrowing, the period commencing on the date of such LIBOR Rate Loan or the date of the
conversion of any Loan into such LIBOR Rate Loan, as the case may be, and ending on the last
day of the period selected by the Borrower pursuant to Section 2.2 or 3.6, as the case may
be, and, thereafter, each subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of the period selected by the Borrower
pursuant to Section 3.6. The duration of each such Interest Period shall be two weeks or
one, two, three or six months (or such other period as may be approved by the Administrative
Agent), as Borrower may select by notice pursuant to Section 2.2 or 3.6 hereof,
provided, however, that:




     (i) any Interest Period in respect of a Loan that would otherwise extend beyond
the Termination Date shall end on the Termination Date;




     (ii) whenever the last day of any Interest Period would otherwise occur on a
day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day; provided that if such
extension would cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period shall occur on the
next preceding Business Day, and




     (iii) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last Business
Day of a calendar month.




     “Investment” has the meaning specified in Section 7.2(f).



10









 






     “Issuing Bank” means (i) the Existing Issuing Banks, (ii) JPMorgan Chase Bank,
N.A., and Wachovia Bank, National Association, each in its capacity as issuer of any Letter
of Credit; provided, however, that neither JPMorgan Chase Bank, N.A. nor Wachovia Bank,
National Association shall be required, without the consent of such Issuing Bank, to issue
Letters of Credit in excess of $37,500,000 at any time outstanding for each such Issuing
Bank, and (iii) any other Bank, in such capacity, selected to be an Issuing Bank by the
Borrower with the consent of the Administrative Agent, which shall not be unreasonably
withheld, and such Bank. Any reference to an Issuing Bank herein means the applicable
institution issuing the applicable Letter of Credit.




     “Junior Subordinated Debt” means subordinated debt of the Borrower or any
Subsidiary of the Borrower (i) that is issued to an issuer of Hybrid Equity Securities in
connection with the issuance of such Hybrid Equity Securities, (ii) the payment of the
principal of which and interest on which is subordinated (with certain exceptions) to the
prior payment in full in cash or its equivalent of all senior indebtedness of the obligor
thereunder and (iii) that has an original tenor no earlier than 30 years from the issuance
thereof.




     “L/C Commitment” means the amount of $75,000,000.




     “L/C Fee Payment Date” means the last day of each March, June, September and
December, commencing on June 30, 2007 while the L/C Commitment remains in effect and the
Termination Date.




     “L/C Obligations” means, at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired face amount of the then outstanding Letters of Credit
and (b) the aggregate amount of drawings under Letters of Credit that have not then been
reimbursed pursuant to Section 2.5.




     “L/C Participants” means the collective reference to all the Banks other than
the Issuing Bank in their respective capacities as participants in L/C Obligations.




     “Lead Arrangers” means Barclays Capital and Wachovia Bank, National
Association, in their capacities as joint lead arrangers and bookrunners.




     “Letters of Credit” has the meaning assigned to such term in Section
2.5(a)(ii).




     “LIBOR Rate” means, with respect to each day during each Interest Period
pertaining to a LIBOR Rate Loan, the rate per annum determined on the basis of the rate for
deposits in Dollars for a period equal to such Interest Period commencing on the first days
of such Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M.,
London time, two Business Days prior to the beginning of such Interest Period. In the event
that such rate does not appear on Page 3750 of the Telerate screen (or otherwise on such
screen), the “LIBOR Rate” shall be determined by reference to such other comparable
publicly available service for displaying eurodollar rates as may be selected by the
Administrative Agent or, in the absence of such availability, by reference to the rate at
which the Administrative Agent is offered Dollar deposits at or about 11:00 A.M., New York
City time, two Business Days prior to the beginning of such Interest Period in



11









 






the interbank eurodollar market where its eurodollar and foreign currency and exchange
operations are then being conducted for delivery on the first day of such Interest Period
for the number of days comprised therein.




     “LIBOR Rate Loan” means a Loan that bears interest at the LIBOR Rate as
provided in Section 3.3(b).




     “Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment,
deposit arrangement, charge, security interest, encumbrance or lien of any kind whatsoever
(including any Capital Lease).




     “Loans” means the loans made by the Banks to the Borrower pursuant to this
Agreement.




     “Loan Documents” means this Agreement, any Notes and any document or instrument
executed in connection with the foregoing.




     “Majority Banks” means, at any time, Banks having in excess of 50% of the Total
Commitments then in effect or, if the Commitments shall have terminated, the Total
Outstanding Extensions of Credit then outstanding.




     “Mandatory Payment Preferred Stock” means any preference or preferred stock of
the Borrower or of any Consolidated Subsidiary (other than (x) any preference or preferred
stock issued to the Borrower or its Subsidiaries, (y) Hybrid Equity Securities, and (z)
Junior Subordinated Debt) that is subject to mandatory redemption, sinking fund or
retirement provisions (regardless of whether any portion thereof is due and payable within
one year).




     “Margin Stock” has the meaning assigned to such term in Regulation U.




     “Material Adverse Effect” means any material adverse effect on the ability of
the Borrower to perform its obligations under the Loan Documents on a timely basis (it being
understood that Material Adverse Effect shall not include the effect of any True-Up
Litigation).




     “Maturity Date” means June 29, 2012.




     “Money Market Rate” means (a) the “ASK” rate for Federal Funds appearing on
Page 5 of the Dow Jones Market Service (or on any successor or substitute page of such
Service, or any successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as determined by the
Swingline Lender from time to time for purposes of providing quotations of the offer rates
applicable to Federal Funds for a term of one Business Day) at the time reviewed by the
Swingline Lender plus (b) the Applicable Margin for LIBOR Rate Loans. In the event
that part (a) of such rate is not available at such time for any reason, then part (a) of
such rate will be the rate agreed to between the Swingline Lender and the Borrower. The
Borrower understands and agrees that the rate quoted from Page 5 of the Dow Jones Market
Service is a real-time rate that changes from time to time. The rate quoted by the



12









 






Swingline Lender and used for the purpose of setting the interest rate for a Swingline
Loan will be the rate on the screen of the Swingline Lender at the time of setting the rate
and will not be an average or composite of rates for that day.




     “Money Market Rate Loan” means a Swingline Loan the rate of interest applicable
to which is based upon the Money Market Rate.




     “Moody’s” means Moody’s Investors Service, Inc. and any successor rating
agency.




     “Multiemployer Plan” means a Plan that is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.




     “Net Tangible Assets” means the total assets of the Borrower, its Consolidated
Subsidiaries and the Unrestricted Subsidiaries, minus goodwill and other intangible
assets as shown on the balance sheet of the Borrower, its Consolidated Subsidiaries and the
Unrestricted Subsidiaries delivered pursuant to Section 7.1(a) in respect of the most
recently ended fiscal quarter of the Borrower.




     “Non-Recourse Debt” means (i) any Indebtedness for Borrowed Money incurred by
any Project Financing Subsidiary to finance the acquisition, improvement, installation,
design, engineering, construction, development, completion, maintenance or operation of, or
otherwise to pay costs and expenses relating to or providing financing for any project,
which Indebtedness for Borrowed Money does not provide for recourse against the Borrower or
any Subsidiary of the Borrower (other than a Project Financing Subsidiary and such recourse
as exists under a Performance Guaranty) or any property or asset of the Borrower or any
Subsidiary of the Borrower (other than Capital Stock of, or the property or assets of, a
Project Financing Subsidiary and such recourse as exists under a Performance Guaranty) and
(ii) any refinancing of such Indebtedness for Borrowed Money that does not increase the
outstanding principal amount thereof (other than to pay costs incurred in connection
therewith and the capitalization of any interest, fees, premium or penalties) at the time of
the refinancing or increase the property subject to any Lien securing such Indebtedness for
Borrowed Money or otherwise add additional security or support for such Indebtedness for
Borrowed Money.




     “Notes” means the collective reference to any promissory note evidencing Loans.




     “Notice Date” has the meaning specified in Section 2.7.




     “Notice of Borrowing” has the meaning specified in Section 2.2.




     “Notice of Interest Conversion/Continuation” has the meaning specified in
Section 3.6(a).




     “Original Mortgage” means the Mortgage and Deed of Trust, dated as of November
1, 1944, by the Borrower to South Texas Commercial National Bank of Houston, as Trustee (The
Bank of New York Trust Company, N.A., as successor Trustee), as amended, modified or
supplemented from time to time.



13









 






     “Other Taxes” has the meaning specified in Section 4.3(b).




     “Outstanding Extensions of Credit” means, as to any Bank at any time, an amount
equal to the sum of (a) the aggregate principal amount of all Loans made by such Bank then
outstanding, (b) such Bank’s Revolving Percentage of the L/C Obligations then outstanding
and (c) such Bank’s Swingline Exposure at such time.




     “Participant” has the meaning specified in Section 10.6(b).




     “PBGC” means the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any successor.




     “Performance Guaranty” means any guaranty issued in connection with any
Non-Recourse Debt that (i) if secured, is secured only by assets of or Capital Stock of a
Project Financing Subsidiary, and (ii) guarantees to the provider of such Non-Recourse Debt
or any other Person (a) performance of the improvement, installment, design, engineering,
construction, acquisition, development, completion, maintenance or operation of, or
otherwise affects any such act in respect of, all or any portion of the project that is
financed by such Non-Recourse Debt, (b) completion of the minimum agreed equity or other
contributions or support to the relevant Project Financing Subsidiary, or (c) performance by
a Project Financing Subsidiary of obligations to Persons other than the provider of such
Non-Recourse Debt.




     “Permitted Liens” means with respect to any Person:




     (a) Liens for current taxes, assessments or other governmental charges that are
not delinquent or remain payable without any penalty, or the validity or amount of
which is contested in good faith by appropriate proceedings, provided,
however, that adequate reserves with respect thereto are maintained on the
books of such Person in accordance with GAAP, and provided, further,
that any right to seizure, levy, attachment, sequestration, foreclosure or
garnishment with respect to Property of such Person or any Subsidiary of such Person
by reason of such Lien has not matured, or has been, and continues to be,
effectively enjoined or stayed;




     (b) landlord Liens for rent not yet due and payable and Liens for materialmen,
mechanics, warehousemen, carriers, employees, workmen, repairmen and other similar
nonconsensual Liens imposed by operation of law, for current wages or accounts
payable or other sums not yet delinquent, in each case arising in the ordinary
course of business or if overdue, that are being contested in good faith by
appropriate proceedings, provided, however, that any right to
seizure, levy, attachment, sequestration, foreclosure or garnishment with respect to
Property of such Person or any Subsidiary of such Person by reason of such Lien has
not matured, or has been, and continues to be, effectively enjoined or stayed;




     (c) Liens (other than any Lien imposed pursuant to Section 401(a)(29) or 412(n)
of the Code, ERISA or any environmental law, order, rule or regulation)



14









 






incurred or deposits made, in each case, in the ordinary course of business,
(i) in connection with workers’ compensation, unemployment insurance and other types
of social security or (ii) to secure (or to obtain letters of credit that secure)
the performance of tenders, statutory obligations, surety and appeal bonds, bids,
leases, performance or payment bonds, purchase, construction, sales contracts and
other similar obligations, in each case not incurred or made in connection with the
borrowing of money, the obtaining of advances or the payment of the deferred
purchase price of property;




     (d) Liens arising out of or in connection with any litigation or other legal
proceeding that is being contested in good faith by appropriate proceedings;
provided, however, that adequate reserves with respect thereto are
maintained on the books of such Person in accordance with GAAP; and
provided, further, that, subject to Section 8.1(i) (so long as such
Lien is discharged or released within 60 days of attachment thereof), any right to
seizure, levy, attachment, sequestration, foreclosure or garnishment with respect to
Property of such Person or any Subsidiary of such Person by reason of such Lien has
not matured, or has been, and continues to be, effectively enjoined or stayed;




     (e) precautionary filings under the applicable Uniform Commercial Code made by
a lessor with respect to personal property leased to such Person or any Subsidiary
of such Person;




     (f) other non-material Liens or encumbrances none of which secures Indebtedness
for Borrowed Money of the Borrower or any of its Subsidiaries or interferes
materially with the use of the Property affected in the ordinary conduct of
Borrower’s or its Subsidiaries’ business and which individually or in the aggregate
do not have a Material Adverse Effect;




     (g) easements, rights-of-way, restrictions and other similar encumbrances and
exceptions to title existing or incurred in the ordinary course of business that, in
the aggregate, do not in any case materially detract from the value of the property
subject thereto or materially interfere with the ordinary conduct of the business of
the Borrower and its Subsidiaries, taken as a whole;




     (h) (i) Liens created by Capital Leases, provided that the Liens
created by any such Capital Lease attach only to the Property leased to the Borrower
or one of its Subsidiaries pursuant thereto, (ii) purchase money Liens securing
Indebtedness of the Borrower or any of its Subsidiaries (including such Liens
securing such Indebtedness incurred within twelve months of the date on which such
Property was acquired), provided that all such Liens attach only to the
Property purchased with the proceeds of the Indebtedness secured thereby and only
secure the Indebtedness incurred to finance such purchase, (iii) Liens on
receivables, customer charges, notes, ownership interests, contracts or contract
rights created in connection with a sale, securitization or monetization of such
receivables, customer charges, notes, ownership interests, contracts or contract
rights, and Liens on rights of the Borrower or any Subsidiary related to such



15









 






receivables, customer charges, notes, ownership interests, contracts or
contract rights which are transferred to the purchaser of such receivables, customer
charges, notes, ownership interests, contracts or contract rights in connection with
such sale, securitization or monetization, provided that such Liens secure
only the obligations of the Borrower or any of its Subsidiaries in connection with
such sale, securitization or monetization and (iv) Liens created by leases that do
not constitute Capital Leases at the time such leases are entered into,
provided that the Liens created thereby attach only to the Property leased
to the Borrower or one of its Subsidiaries pursuant thereto;




     (i) Liens on cash and short-term investments (i) deposited by the Borrower or
any of its Subsidiaries in accounts with or on behalf of futures contract brokers or
other counterparties or (ii) pledged by the Borrower or any of its Subsidiaries, in
the case of clause (i) or (ii) to secure its obligations with respect to contracts
(including without limitation, physical delivery, option (whether cash or
financial), exchange, swap and futures contracts) for the purchase or sale of any
energy-related commodity or interest rate or currency rate management contracts;




     (j) Liens on (i) Property owned by a Project Financing Subsidiary or (ii)
equity interests in a Project Financing Subsidiary (including in each case a pledge
of a partnership interest, common stock or a membership interest in a limited
liability company) securing Indebtedness of the Borrower or any of its Subsidiaries
incurred in connection with a Project Financing; and




     (k) Liens on equity interests in an Unrestricted Subsidiary (including in each
case a pledge of a partnership interest, common stock or a membership interest in a
limited liability company) securing, subject to Section 7.2(f), Indebtedness of such
Unrestricted Subsidiary.



     “Person” means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint venture, government
(or any political subdivision or agency thereof) or any other entity of whatever nature.



     “Plan” means, at a particular time with respect to the Borrower, any employee
benefit plan that is covered by ERISA and in respect of which Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.



     “Platform” has the meaning specified in Section 10.2(b).



     “Project Financing” means any Indebtedness or lease obligations that do not
constitute Capital Leases at the time such leases are entered into, in each case that are
incurred to finance a project or group of projects (including any construction financing) to
the extent that such Indebtedness (or other obligations) expressly are not recourse to the
Borrower or any of its Restricted Subsidiaries (other than a Project Financing Subsidiary)
or any of their respective Property other than the Property of a Project



16









 




Financing Subsidiary and equity interests in a Project Financing Subsidiary (including
in each case a pledge of a partnership interest, common stock or a membership interest in a
limited liability company).




     “Project Financing Subsidiary” means any Restricted Subsidiary of the Borrower
(or any other Person in which Borrower directly or indirectly owns a 50% or less interest)
whose principal purpose is to incur Project Financing or to become an owner of interests in
a Person so created to conduct the business activities for which such Project Financing was
incurred, and substantially all the fixed assets of which Subsidiary or Person are those
fixed assets being financed (or to be financed) in whole or in part by one or more Project
Financings.



     “Property” means any interest or right in any kind of property or asset,
whether real, personal or mixed, owned or leased, tangible or intangible and whether now
held or hereafter acquired.



     “Public Lender” has the meaning specified in Section 10.2(b).



     “Purchasing Banks” has the meaning specified in Section 10.6(c).



     “PUC” means the Public Utility Commission of Texas.



     “Rating” means the Borrower’s corporate credit rating or its equivalent (or if
such rating is discontinued or unavailable, the senior unsecured long-term debt rating or
its equivalent) issued by the Rating Agencies (it being understood that a change in outlook
status (e.g., watch status, negative outlook status) is not a change in Rating as
contemplated hereby).



     “Rating Agencies” means (a) S&P, (b) Moody’s and (c) Fitch.



     “Register” has the meaning specified in Section 10.6(d) hereof.



     “Regulation U” means Regulation U of the Board or any other regulation
hereafter promulgated by the Board to replace the prior Regulation U and having
substantially the same function.



     “Reimbursement Obligation” means the obligation of the Borrower to reimburse
the Issuing Bank pursuant to Section 2.5(e) for amounts drawn under Letters of Credit.



     “Reorganization” means, with respect to any Multiemployer Plan, the condition
that such Plan is in reorganization within the meaning of Section 4241 of ERISA.



     “Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA and PBGC Reg. § 4043, other than those events as to which the thirty-day notice period
is waived under PBGC Reg. § 4043 or other regulations, notices or rulings issued by the
PBGC.



17









 





     “Requirement of Law” means, as to any Person, any law, statute, ordinance,
decree, requirement, order, judgment, rule or regulation of any Governmental Authority.



     “Resources” means CenterPoint Energy Resources Corp., a Delaware corporation,
and a Wholly-Owned Subsidiary of CenterPoint.



     “Resources Facility” means the $950,000,000 Second Amended and Restated Credit
Agreement, dated as of the date hereof, among Resources, as borrower, Citibank, N.A., as
administrative agent, the other financial institutions, and agents parties thereto, as
amended, modified or supplemented from time to time.



     “Responsible Officer” means, with respect to any Person, its chief financial
officer, chief accounting officer, assistant treasurer, treasurer or controller of such
Person or any other officer of such Person whose primary duties are similar to the duties of
any of the previously listed officers of such Person.



     “Restricted Subsidiaries” means all Subsidiaries of the Borrower other than
Securitization Subsidiaries and Unrestricted Subsidiaries.



     “Revolving Percentage” means, as to any Bank at any time, a fraction (expressed
as a percentage) the numerator of which is the amount of such Bank’s Commitment or, if the
Commitments shall have terminated, the Outstanding Extensions of Credit of such Bank then
outstanding, and the denominator of which is the Total Commitments then in effect or, if the
Commitments shall have terminated, the Total Outstanding Extensions of Credit then
outstanding.



     “S&P” means Standard & Poor’s Ratings Group and any successor rating agency.



     “SEC” means the Securities and Exchange Commission and any successor thereto.



     “Second Extended Termination Date” has the meaning specified in Section 2.7.



     “Secured Indebtedness” means, with respect to any Person, all Indebtedness
secured (or for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured) by any Lien on any Property (including, without limitation,
accounts and contract rights) owned by such Person or any of its Subsidiaries, even though
such Person has not assumed or become liable for the payment of such Indebtedness.



     “Securitization Securities” means transition bonds issued pursuant to the Texas
Electric Choice Plan if (and only if) no recourse may be had to the Borrower or any of its
Subsidiaries (or to their respective assets) for the payment of such obligations, other than
the issuer of the bonds and its assets, provided that payment of transition charges
by any retail electric provider (“REP”) in accordance with such legislation, whether
or not such REP has collected such charges from the retail electric customers, shall not be
deemed “recourse” hereunder, including any REP that is a Subsidiary of the Borrower or a
division of an Affiliate of the Borrower or any Affiliate of the Borrower.



18









 





     “Securitization Subsidiary” means a special purpose subsidiary created to issue
Securitization Securities.



     “Significant Subsidiary” means (i) for the purposes of determining what
constitutes an “Event of Default” under Sections 8.1(f), (g), (h), (i) and (j), a Subsidiary
of the Borrower (other than a Project Financing Subsidiary) whose total assets, as
determined in accordance with GAAP, represent at least 10% of the total assets of the
Borrower, on a consolidated basis, as determined in accordance with GAAP and (ii) for all
other purposes the “Significant Subsidiaries” shall be those Subsidiaries of the Borrower
whose total assets, as determined in accordance with GAAP, represent at least 10% of the
total assets of the Borrower on a consolidated basis, as determined in accordance with GAAP
for the Borrower’s most recently completed fiscal year and identified in the certificate
most recently delivered pursuant to Section 7.1(a)(iv)(C); provided that no
Securitization Subsidiary or Unrestricted Subsidiary shall be deemed to be a Significant
Subsidiary or subject to the restrictions, covenants or Events of Default under this
Agreement.



     “Single Employer Plan” means any Plan that is covered by Title IV of ERISA, but
that is not a Multiemployer Plan.



     “Subsidiary” means, as to any Person, a corporation, partnership, limited
liability company or other entity of which more than 50% of the outstanding shares of
Capital Stock or other ownership interests having ordinary voting power (other than Capital
Stock or such other ownership interests having such power only by reason of the happening of
a contingency) to elect directors or other managers of such corporation, partnership or
other entity are at the time owned, directly or indirectly, through one or more Subsidiaries
of such Person, by such Person; provided, however, that no Securitization
Subsidiary shall be deemed to be a Subsidiary for purposes of this Agreement.



     “Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled by reference
to, one or more rates, currencies, commodities, equity or debt instruments or securities, or
economic, financial or pricing indices or measures of economic, financial or pricing risk or
value or any similar transaction or any combination of these transactions; provided
that no phantom stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of the Borrower
or any of its Subsidiaries shall be a “Swap Agreement”.



     “Swingline Commitment” has the meaning specified in Section 2.4(a).



     “Swingline Exposure” means, at any time, the aggregate principal amount of all
Swingline Loans outstanding at such time.



     “Swingline Lender” means JPMorgan Chase Bank, in its capacity as lender of
Swingline Loans hereunder.



     “Swingline Loan” means a Loan made pursuant to Section 2.4.



19









 





     “Syndication Agent” has the meaning specified in the introduction to this
Agreement.



     “Taxes” has the meaning specified in Section 4.3(a).



     “Termination Date” means the Maturity Date as the same may be extended pursuant
to Section 2.7, or any earlier date on which (a) the Commitments have been terminated in
accordance with this Agreement or (b) all unpaid principal amounts of the Loans hereunder
have been declared due and payable in accordance with this Agreement.



     “Total Commitments” means, at any time, the aggregate amount of the Commitments
of all Banks then in effect.



     “Total Outstanding Extensions of Credit” means, at any time, the aggregate
amount of the Outstanding Extensions of Credit of all Banks outstanding at such time.



     “Tranche” means the collective reference to LIBOR Rate Loans, the Interest
Periods with respect to all of which begin on the same date and end on the same later date
(whether or not such Loans shall originally have been made on the same day).



     “Transferee” has the meaning specified in Section 10.6(f).



     “Transfer Effective Date” has the meaning specified in Section 10.6(c).



     “Transition Charges Principal and Interest” means the non-bypassable transition
charges billed to customers for payment of debt service on Securitization Securities.



     “Triggering Event” has the meaning specified in Section 4.8(b).



     “True-Up Litigation” means any litigation or other proceeding in connection
with the determination by the PUC of the recovery by CenterPoint and its Subsidiaries of
stranded costs and other amounts to be recovered in the true-up process.



     “Type” refers to the determination of whether a Loan is an ABR Loan or a LIBOR
Rate Loan (or a Borrowing comprised of such Loans).



     “Uniform Customs” means the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No. 500, as the same
may be amended from time to time.



     “United States” means the United States of America.



     “Unrestricted Subsidiary” means any Subsidiary of the Borrower and its direct
or indirect Subsidiaries that is designated by a Responsible Officer of the Borrower as an
Unrestricted Subsidiary, but only if (x) the aggregate amount of net tangible assets of all
Unrestricted Subsidiaries at the time of designation does not exceed, or would not exceed as
a result of such designation, 10% of the Net Tangible Assets, (y) such designation and the
Investment of the Borrower in such Subsidiary complies with the limitations in



20









 




Section 7.2(f) and (z) such Subsidiary: (i) has no Indebtedness with recourse to the
Borrower and the Restricted Subsidiaries except that permitted under Section 7.2(f); (ii) is
not party to any agreement, contract, arrangement or understanding with the Borrower or any
Significant Subsidiary of the Borrower unless the terms of any such agreement, contract,
arrangement or understanding and related transactions are substantially no less favorable to
the Borrower or such Significant Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Borrower; (iii) is a Person with respect to which
neither the Borrower nor any of its Significant Subsidiaries has any direct or indirect
obligation that violates Section 7.2(f) (a) to subscribe for additional Capital Stock of
such Person or (b) to maintain or preserve such Person’s financial condition or to cause
such Person to achieve any specified levels of operating results; and (iv) does not, either
alone or in the aggregate, operate, directly or indirectly, all or substantially all of the
business of the Borrower and its Subsidiaries.




     Any designation of a Subsidiary of the Borrower as an Unrestricted Subsidiary shall be
evidenced by a certificate of a Responsible Officer of the Borrower giving effect to such
designation and a certificate executed by a Responsible Officer certifying that such
designation complied with the preceding conditions and was permitted by Section 7.2(f)
delivered to the Administrative Agent. If, at any time, any Unrestricted Subsidiary would
fail to meet the preceding requirements as an Unrestricted Subsidiary, it shall thereafter
cease to be an Unrestricted Subsidiary for purposes of this Agreement and any Indebtedness
of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Borrower
as of such date and, if such Indebtedness is not permitted to be incurred as of such date
under Section 7.2(f), the Borrower shall be in default of such covenant. A Responsible
Officer of the Borrower may at any time designate any Unrestricted Subsidiary to be a
Subsidiary of the Borrower that is not an Unrestricted Subsidiary; provided that
such designation shall be deemed to be an incurrence of Indebtedness by such Subsidiary of
any outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only
be permitted if (1) such Indebtedness is permitted under this Agreement calculated on a pro
forma basis as if such designation had occurred at the beginning of the four-quarter
reference period; and (2) no Default or Event of Default would be in existence following
such designation.



     “Utilization Fee” means, as to any Bank, the fee equal to the rate per annum
set forth below opposite the Designated Rating from time to time in effect during the period
for which payment is due on the Outstanding Extensions of Credit of such Bank:



	 	 	 
	Designated	 	 
	Rating	 	Utilization Fee
	Higher than BBB+/Baa1/BBB+
	 	0.05%
	BBB+/Baa1/BBB+
	 	0.05%
	BBB/Baa2/BBB
	 	0.05%
	BBB-/Baa3/BBB-
	 	0.05%
	BB+/Ba1/BB+
	 	0.10%
	Lower than BB+/Ba1/BB+
	 	0.10%






21









 






     The Designated Ratings referred to above are issued by S&P, Moody’s and Fitch,
respectively.




     “Wholly-Owned” means, with respect to any Subsidiary of any Person, all the
outstanding Capital Stock (other than directors’ qualifying shares required by law) or other
ownership interest of such Subsidiary which are at the time owned by such Person or by one
or more Wholly-Owned Subsidiaries of such Person, or both.



     SECTION
1.2. Other Definitional Provisions. (a) Unless otherwise specified therein, all terms
defined in this Agreement shall have such defined meanings when used in the other Loan Documents or
any certificate or other document made or delivered pursuant hereto or thereto.



     (b) As used herein and in the other Loan Documents, and any certificate or other document made
or delivered pursuant hereto or thereto, (i) accounting terms relating to the Borrower or any of
its Subsidiaries not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to
the extent not defined, shall have the respective meanings given to them under GAAP, (ii) the words
“include”, “includes” and “including” shall be deemed to be followed by the phrase “without
limitation”, (iii) the word “incur” shall be construed to mean incur, create, issue, assume, become
liable in respect of or suffer to exist (and the words “incurred” and “incurrence” shall have
correlative meanings), (iv) the words “asset” and “property” shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible assets and properties,
including cash, Capital Stock, securities, revenues, accounts, leasehold interests and contract
rights, and (v) references to agreements or other Contractual Obligations shall, unless otherwise
specified, be deemed to refer to such agreements or Contractual Obligations as amended,
supplemented, restated or otherwise modified from time to time.



     (c) The words “hereof”, “herein” and “hereunder” and words of similar import, when used in
this Agreement, shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise
specified.



     (d) The meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.



ARTICLE II




AMOUNTS AND TERMS OF THE LOANS AND LETTERS OF CREDIT




     SECTION
2.1. The Commitments. (a) Each Bank severally agrees, on the terms and subject to the
conditions hereinafter set forth, to make revolving credit Loans to the Borrower from time to time
on any Business Day during the period from the Closing Date until the Termination Date in an
aggregate principal amount outstanding, which, when added to such Bank’s Revolving Percentage of
the sum of (i) then outstanding L/C Obligations and (ii) the then outstanding principal amount of
the Swingline
Loans, does not exceed at any time such Bank’s



22









 




Commitment; provided that no Loan shall
be made as a LIBOR Rate Loan with an Interest Period ending after the Termination Date; and
provided, further, that in no event shall the Total Outstanding Extensions of
Credit at any time exceed the Total Commitments at such time.




     (b) Each Borrowing by the Borrower shall be in an aggregate principal amount not less than
$10,000,000 (in the case of LIBOR Rate Loans) or $5,000,000 (in the case of ABR Loans), or an
integral multiple of $1,000,000 in excess thereof and shall consist of Loans of the same Type made
on the same day by the Banks ratably according to their respective Revolving Percentages. Each
Swingline Loan shall be in an amount that is equal to $500,000 or a whole multiple of $100,000 in
excess thereof. Within the limits of the applicable Commitments, the Borrower may borrow, prepay
pursuant to Section 4.6 and reborrow under this Section 2.1. The principal amount outstanding on
the Loans shall be due and payable on the Termination Date, together with accrued and unpaid
interest thereon.



     SECTION
2.2. Procedure for Revolving Loan Borrowing. (a) The Borrower may borrow under the
Commitments on any Business Day during the period from and including the Closing Date to and
excluding the Termination Date, provided that the Borrower shall give the Administrative
Agent irrevocable oral notice or written notice pursuant to a notice of borrowing, in substantially
the form of Exhibit A hereto (“Notice of Borrowing”) which shall be signed by the
Borrower and shall specify therein the requested (i) date of such Borrowing, (ii) Type of Loans
comprising such Borrowing, (iii) aggregate amount of such Borrowing and (iv) the Interest Period
for each such Loan, in the case of any LIBOR Rate Loan:




     (i) not later than 11:00 A.M. (New York City time) on the third Business Day prior to
the date of the proposed Borrowing in the case of a LIBOR Rate Loan;




     (ii) not later than 11:00 A.M. (New York City time) on the Business Day immediately
preceding the date of the proposed Borrowing in the case of an Early Funding ABR Loan; and




     (iii) not later than 11:00 A.M. (New York City time) on the same Business Day of the
proposed Borrowing in the case of any other ABR Loan.


With respect to any oral notice of borrowing given by the Borrower, the Borrower shall promptly
thereafter confirm such notice in writing pursuant to a Notice of Borrowing. Upon receipt of any
such notice, the Administrative Agent shall promptly notify each Bank thereof. Each Bank shall,
before 1:00 P.M. (New York City time) on the date of such Borrowing, make available to the
Administrative Agent at the Funding Office, in immediately available funds, such Bank’s applicable
Revolving Percentage of such Borrowing; provided, however, that, in the event of a
requested ABR Loan with respect to which the Borrower has delivered its Notice of Borrowing on the
Business Day immediately preceding the requested Borrowing Date (an “Early Funding ABR
Loan”), each Bank shall make its applicable Revolving Percentage of such Borrowing available
before 10:00 A.M. (New York City time) on the requested Borrowing Date. The Administrative Agent
shall, no later than 2:00 P.M. (New York City time) on such date (or no
later than 11:00 A.M. (New York City time), in the case of an Early Funding ABR Loan), make
available to the Borrower the proceeds of the Loans received by the Administrative Agent hereunder
by crediting such account of the Borrower which the Administrative Agent and the





23









 







Borrower shall
from time to time designate. Each Notice of Borrowing shall be irrevocable and binding on the
Borrower.




     (b) Unless the Administrative Agent shall have received notice from a Bank at least two hours
prior to the applicable time described in clause (a) above by which such Bank is required to
deliver its funds to the Administrative Agent with respect to any Borrowing that such Bank will not
make available to the Administrative Agent such Bank’s applicable Revolving Percentage of such
Borrowing, the Administrative Agent may assume that such Bank has made such portion available to
the Administrative Agent on the date of such Borrowing in accordance with Section 2.2(a) and the
Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If such amount is made available to the Administrative Agent on a
date after such date of Borrowing, such Bank shall pay to the Administrative Agent on demand an
amount equal to the product of (i) the daily average Federal Funds Effective Rate during such
period, times (ii) the amount of such Bank’s applicable Revolving Percentage of such Borrowing,
times (iii) a fraction, the numerator of which is the number of days that elapse from and including
such date of Borrowing to the date on which such Bank’s applicable Revolving Percentage of such
Borrowing shall have become immediately available to the Administrative Agent and the denominator
of which is 360. A certificate of the Administrative Agent submitted to any Bank with respect to
any amounts owing under this Section 2.2(b) shall be conclusive in the absence of manifest error.
If such Bank shall repay to the Administrative Agent such corresponding amount, such amount so
repaid shall constitute such Bank’s Loan as part of such Borrowing for purposes of this Agreement.
If such Bank’s applicable Revolving Percentage of such Borrowing is not in fact made available to
the Administrative Agent by such Bank within one (1) Business Day of such date of Borrowing, the
Administrative Agent shall be entitled to recover such amount with interest thereon at the rate per
annum, equal to (i) the ABR (in the case of ABR Loans) or (ii) the Federal Funds Effective Rate (in
the case of LIBOR Rate Loans), on demand, from the Borrower.



     (c) The failure of any Bank to make the Loan to be made by it as part of any Borrowing shall
not relieve any other Bank of its obligation, if any, hereunder to make its Loan on the date of
such Borrowing, but no Bank shall be responsible for the failure of any other Bank to make the Loan
to be made by such other Bank on the date of any Borrowing.



     SECTION
2.3. Minimum Tranches. All Borrowings, prepayments, conversions and continuations of Loans
hereunder and all selections of Interest Periods hereunder shall be in such amounts and be made
pursuant to such elections so that, after giving effect thereto, the aggregate principal amount of
the Loans comprising each Tranche of LIBOR Rate Loans shall be equal to $10,000,000 or an integral
multiple of $1,000,000 in excess thereof.



     SECTION
2.4. Swingline Loans. (a) Subject to the terms and conditions set forth herein, the Swingline
Lender agrees to make
Swingline Loans to the Borrower from time to time during the period from the Closing Date until the
Termination Date, in an aggregate principal amount at any time outstanding that will not result in
(i) the aggregate principal amount of outstanding Swingline Loans exceeding $50,000,000 (the
“Swingline Commitment”) or (ii) the Total Outstanding Extensions of Credit exceeding the
Total Commitments; provided that the Swingline Lender shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. The Swingline Loans may from time to
time be (i) ABR Loans, (ii) Money



24









 




Market Rate Loans or (iii) a combination thereof, as determined
by the Borrower and notified to the Administrative Agent and the Swingline Lender in accordance
herewith (and shall not be entitled to be converted into LIBOR Rate Loans). Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay
and reborrow Swingline Loans. The Borrower hereby unconditionally promises to pay to the Swingline
Lender the then unpaid principal amount of each Swingline Loan on the earlier of the Maturity Date
and the first date after such Swingline Loan is made that is the 15th or last day of a calendar
month and is at least two Business Days after such Swingline Loan is made; provided that on
each date that a Revolving Loan is made, the Borrower shall repay all Swingline Loans.




          (b) To request a Swingline Loan, the Borrower shall notify the Administrative Agent and the
Swingline Lender of such request by telephone (confirmed pursuant to a Notice of Borrowing by
telecopy or email), not later than (i) 12:00 noon, New York City time, in the case of ABR Loans, or
(ii) 2:00 p.m., New York City time, in the case of Money Market Rate Loans, on the day of a
proposed Swingline Loan. Each such notice shall be irrevocable and shall specify the requested
date (which shall be a Business Day), amount of the requested Swingline Loan, and whether the
requested Swingline Loan shall be an ABR Loan, a Money Market Rate Loan or a combination thereof.
Each Borrowing under the Swingline Commitment shall be in an amount equal to $1,000,000 or a whole
multiple in excess thereof. The Swingline Lender shall make each Swingline Loan available to the
Borrower by means of a credit to the general deposit account of the Borrower with the Swingline
Lender (or, in the case of a Swingline Loan made to finance the reimbursement of any payment that
an Issuing Bank makes under a Letter of Credit as provided in Section 2.5(e), by remittance to the
Issuing Bank) by 3:00 p.m., New York City time, on the requested date of such Swingline Loan.



(c) The Swingline Lender may by written notice given to the Administrative Agent not later than
10:00 a.m., New York City time, on any Business Day require the Banks to acquire participations on
such Business Day in all or a portion of the Swingline Loans outstanding. Such notice shall
specify the aggregate amount of Swingline Loans in which Banks will participate. Promptly upon
receipt of such notice, the Administrative Agent will give notice thereof to each Bank, specifying
in such notice such Bank’s Revolving Percentage of such Swingline Loan or Loans. Each Bank hereby
absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the
Administrative Agent, for the account of the Swingline Lender, such Bank’s Revolving Percentage of
such Swingline Loan or Loans. Each Bank acknowledges and agrees that its obligation to acquire
participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a
Default or reduction or termination of the Commitments, and that each such payment shall be made
without any offset, abatement, withholding or reduction whatsoever. Each Bank shall comply with
its obligation under this
paragraph by wire transfer of immediately available funds, in the same manner as provided in
Section 2.2 with respect to Loans made by such Bank (and Section 2.2 shall apply, mutatis
mutandis, to the payment obligations of the Bank), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the Bank. The
Administrative Agent shall notify the Borrower of any participations in any Swingline Loan acquired
pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be made
to the Administrative Agent and not to the Swingline Lender. Any amounts received by the Swingline




25









 







Lender from the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan
after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Banks that shall have made
their payments pursuant to this paragraph and to the Swingline Lender, as their interests may
appear; provided that any such payment so remitted shall be repaid to the Swingline Lender or to
the Administrative Agent, as applicable, if and to the extent such payment is required to be
refunded to the Borrower for any reason. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof.




     SECTION
2.5. Letters of Credit. (a) L/C Commitment.




     (i) Prior to the Closing Date, the Existing Issuing Banks have issued the Existing
Letters of Credit which from and after the Closing Date shall constitute Letters of Credit
hereunder.




     (ii) Subject to the terms and conditions hereof, each Issuing Bank (other than the
Existing Issuing Banks), in reliance on the agreements of the other Banks set forth in
Section 2.5(d), agrees to issue standby letters of credit (together with the Existing
Letters of Credit, the “Letters of Credit”) for the account of the Borrower in
support of obligations (including, without limitation, performance, bid and similar bonding
obligations and credit enhancement) of the Borrower and its Affiliates on any Business Day
on or after the Closing Date and prior to the Termination Date in such form as may be
approved from time to time by such Issuing Bank; provided that no Issuing Bank shall
issue any Letter of Credit if, after giving effect to such issuance, (A) the L/C Obligations
would exceed the L/C Commitment or (B) the Total Outstanding Extensions of Credit then
outstanding would exceed the Total Commitments then in effect and provided,
further, that neither JPMorgan Chase Bank, N.A. nor Wachovia Bank, National
Association shall be required, without the consent of such Issuing Bank, to issue Letters of
Credit in excess of $37,500,000 at any time outstanding for each such Issuing Bank.




     (iii) Each Letter of Credit shall be denominated in Dollars and shall be a standby
letter of credit issued to support obligations of the Borrower or any of its Affiliates,
contingent or otherwise, and expire no later than the Maturity Date.




     (iv) Each Letter of Credit shall be subject to the Uniform Customs and, to the extent
not inconsistent therewith, the laws of the State of New York.




     (v) No Issuing Bank shall at any time be obligated to issue any Letter of Credit
hereunder if such issuance would conflict with, or cause such Issuing Bank or any L/C
Participant to exceed any limits imposed on such Issuing Bank by any applicable Requirement
of Law.



     (b) Procedure for Issuance of Letters of Credit. The Borrower may from time to time
request that an Issuing Bank issue a Letter of Credit by delivering to such Issuing Bank at its
address for notices specified herein an Application therefor, completed to the satisfaction of such




26









 




Issuing
Bank, and such other certificates, documents and other papers and information as such Issuing Bank may reasonably request. Upon receipt of any Application, the Issuing Bank will
process such Application and the certificates, documents and other papers and information delivered
to it in connection therewith in accordance with its customary procedures and shall promptly issue
the Letter of Credit requested thereby (but in no event shall any Issuing Bank be required to issue
any Letter of Credit earlier than two Business Days after its receipt of the Application therefor
and all such other certificates, documents and other papers and information relating thereto) by
issuing the original of such Letter of Credit in a form satisfactory to the Borrower to the
beneficiary thereof or as otherwise may be agreed by such Issuing Bank and Borrower. The relevant
Issuing Bank shall furnish a copy of such Letter of Credit to the Borrower promptly following the
issuance thereof and notify the Banks of the amount thereof.




     (c) Fees, Commissions and Other Charges.




     (i) The Borrower shall pay to the Administrative Agent, for the account of the relevant
Issuing Bank and the L/C Participants, a letter of credit commission fee with respect to
each Letter of Credit, computed for the period from the last L/C Fee Payment Date (or, if
later, the date of issuance thereof) to the date upon which such payment is due hereunder at
the rate per annum equal to the Applicable Margin for LIBOR Rate Loans then in effect,
calculated on the basis of a 365- (or 366-, as the case may be) day year, of the aggregate
amount available to be drawn under such Letter of Credit on the date on which such fee is
calculated. The Borrower shall pay to the Administrative Agent, for the account of the
relevant Issuing Bank, a fronting fee with respect to each Letter of Credit, computed for
the period from the last L/C Fee Payment Date to the date upon which such payment is due
hereunder at the rate per annum equal to 0.125%, calculated on the basis of a 365- (or 366-,
as the case may be) day year, of the aggregate amount available to be drawn under such
Letter of Credit on the date on which such fee is calculated. Such commissions and fronting
fees shall be payable in arrears on each L/C Fee Payment Date and shall be nonrefundable.




     (ii) In addition to the foregoing fees and commissions, the Borrower shall pay or
reimburse each Issuing Bank for such normal and customary costs and reasonable expenses as
are incurred or charged by such Issuing Bank in issuing, effecting payment under, amending
or otherwise administering any Letter of Credit.




     (iii) The Administrative Agent shall, promptly following its receipt thereof,
distribute to the relevant Issuing Bank and the L/C Participants all fees and commissions
received by the Administrative Agent for their respective accounts pursuant to this Section
2.5(c).



     (d) L/C Participations.




     (i) Each Issuing Bank irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce each Issuing Bank to issue Letters of Credit hereunder, each L/C
Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from
such Issuing Bank, on the terms and conditions hereinafter stated, for such L/C
Participant’s own account and risk an undivided interest equal to such L/C



27









 






Participant’s
Revolving Percentage in each Issuing Bank’s obligations and rights under each Letter of
Credit issued hereunder and the aggregate amount of drawings under Letters of Credit that
have not then been reimbursed pursuant to Section 2.5(e). Each L/C Participant
unconditionally and irrevocably agrees with each Issuing Bank that, if a draft is paid under
any Letter of Credit for which such Issuing Bank is not reimbursed in full by the Borrower
in accordance with the terms of this Agreement, such L/C Participant shall pay to such
Issuing Bank upon demand at such Issuing Bank’s address for notices specified herein an
amount equal to such L/C Participant’s Revolving Percentage of the amount of such draft, or
any part thereof, which is not so reimbursed. Each Bank acknowledges and agrees that its
obligation to acquire participations pursuant to this Section 2.5(d)(i) in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or termination of the
Commitments, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.




     (ii) If any amount required to be paid by any L/C Participant to an Issuing Bank
pursuant to Section 2.5(d)(i) in respect of any unreimbursed portion of any payment made by
such Issuing Bank under any Letter of Credit is not paid to such Issuing Bank within one
Business Day after the date such payment is due, such L/C Participant shall pay to such
Issuing Bank on demand an amount equal to the product of (A) such amount, times (B) the
daily average Federal Funds Effective Rate as quoted by the relevant Issuing Bank, during
the period from and including the date such payment is required to the date on which such
payment is immediately available to such Issuing Bank, times (C) a fraction the numerator of
which is the number of days that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C Participant pursuant to Section
2.5(d)(i) is not in fact made available to the relevant Issuing Bank by such L/C Participant
within three (3) Business Days after the date such payment is due, such Issuing Bank shall
be entitled to recover from such L/C Participant, on demand, such amount with interest
thereon calculated from such due date at the ABR. A certificate of the relevant Issuing
Bank submitted to any L/C Participant with respect to any amounts owing under this
subsection shall be conclusive in the absence of manifest error.




     (iii) Whenever, at any time after any Issuing Bank has made payment under any Letter of
Credit and has received from any L/C Participant its pro rata share of such payment in
accordance with Section 2.5(d)(i), such Issuing Bank receives any payment related to such
Letter of Credit (whether directly from the Borrower or otherwise, including proceeds of
collateral applied thereto by the Issuing Bank), or any payment of interest on account
thereof, such Issuing Bank will distribute to such L/C Participant its
pro rata share thereof; provided, however, that in the event that any
such payment received by such Issuing Bank shall be required to be returned by such Issuing
Bank, such L/C Participant shall return to such Issuing Bank the portion thereof previously
distributed by such Issuing Bank to it.



     (e) Reimbursement Obligation of the Borrower. (i) The Borrower shall reimburse each
Issuing Bank for any payment that such Issuing Bank makes under a Letter of Credit on or



28









 




before the
date of such payment if the Borrower receives notice of such payment on or before 10:00 a.m. (New
York City time) on the date such payment is made by such Issuing Bank; provided,
however, that, if the Borrower does not receive timely notice or reimburse such Issuing
Bank under this Section 2.5(e)(i), then Section 2.5(e)(ii) shall apply. Each such payment shall be
made to the relevant Issuing Bank at its address for notices specified herein in Dollars and in
immediately available funds.





     (ii) Notwithstanding Section 5.2, each drawing under any Letter of Credit shall be
deemed to constitute a Borrowing of ABR Loans in the amount of such drawing unless the
Borrower has reimbursed the relevant Issuing Bank under Section 2.5(e)(i). The Borrowing
Date with respect to each such borrowing shall be deemed to be the date of such drawing.



     (f) Obligations Absolute.




     (i) The Borrower’s payment obligations under Section 2.5(e) shall be absolute and
unconditional under any and all circumstances and irrespective of any set-off, counterclaim
or defense to payment that the Borrower may have or have had against the relevant Issuing
Bank or any beneficiary of a Letter of Credit other than a defense based upon the gross
negligence or willful misconduct of such Issuing Bank or violation of the standards of care
specified in the Uniform Commercial Code of the State of New York.




     (ii) The Borrower also agrees with each Issuing Bank that no Issuing Bank shall be
responsible for, and the Borrower’s Reimbursement Obligations under Section 2.5(e) shall not
be affected by, among other things, (i) the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, (ii) any dispute between or among the Borrower and any beneficiary of
any Letter of Credit or any other party to which such Letter of Credit may be transferred or
(iii) any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit
or any such transferee.




     (iii) No Issuing Bank shall be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit, except for errors or omissions caused by such Issuing
Bank’s gross negligence or willful misconduct or in violation of the standards of care
specified in the Uniform Commercial Code of the State of New York.




     (iv) The Borrower agrees that any action taken or omitted by any Issuing Bank under or
in connection with any Letter of Credit or the related drafts or documents, if done in the
absence of gross negligence or willful misconduct and in accordance with the standards of
care specified in the Uniform Commercial Code of the State of New York, shall be binding on
the Borrower and shall not result in any liability of such Issuing Bank to the Borrower.



29









 





     (g) Letter of Credit Payments. If any draft shall be presented for payment under any
Letter of Credit, the relevant Issuing Bank shall promptly notify the Borrower by telephone
(confirmed in writing) of the date and amount thereof and whether such Issuing Bank has made or
will make a payment thereunder. The responsibility of such Issuing Bank to the Borrower in
connection with any draft presented for payment under any Letter of Credit shall, in addition to
any payment obligation expressly provided for in such Letter of Credit, be limited to determining
that the documents (including each draft) delivered under such Letter of Credit in connection with
such presentment are in conformity with such Letter of Credit.



     (h) Application. To the extent that any provision of any Application related to any
Letter of Credit is inconsistent with the provisions of this Section 2.5, the provisions of this
Section 2.5 shall control.



     (i) Replacement of the Issuing Bank. Any Issuing Bank may be replaced at any time by
written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the
successor Issuing Bank. The Administrative Agent shall notify the Banks of any such replacement of
such Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay
all unpaid fees accrued for the account of such replaced Issuing Bank pursuant to Section 2.5(c).
From and after the effective date of any such replacement, (i) the applicable successor Issuing
Bank shall have all the rights and obligations of such Issuing Bank under this Agreement with
respect to Letters of Credit to be issued thereafter and (ii) references herein to the term
“Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to
such successor and all previous Issuing Banks, as the context shall require. After the replacement
of an Issuing Bank hereunder, the applicable replaced Issuing Bank shall remain a party hereto and
shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with
respect to Letters of Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.



     SECTION
2.6. Increase in the Aggregate Commitments. (a) The Borrower may, at any time, whether or not
the Commitments have been reduced pursuant to Section 4.5, by notice to the Administrative Agent,
request that the aggregate amount of the Commitments be increased by an amount of $10,000,000 or an
integral multiple of $5,000,000 in excess thereof (a “Commitment Increase”) to be effective
as of a date that is at least 90 days prior to the scheduled Termination Date then in effect (the
“Increase Date”) as specified in the related notice to the Administrative Agent; provided,
however, that (i) in no event shall the aggregate amount of the Commitments at any time exceed
$450,000,000 and (ii) on the date of any request by the Borrower for a Commitment Increase and on
the related Increase Date, the applicable conditions set forth in Section 5.2 shall be satisfied.



     (b) The Administrative Agent shall promptly notify the Banks of a request by the Borrower for
a Commitment Increase, which notice shall include (i) the proposed amount of such requested
Commitment Increase, (ii) the proposed Increase Date and (iii) the date by which the Banks wishing
to participate in the Commitment Increase must commit to an increase in the amount of their
respective Commitments (the “Commitment Date”). Each Bank that is willing, in its sole
discretion, to participate in such requested Commitment Increase (each an “Increasing
Bank”) shall give written notice to the Administrative Agent and the Borrower on or prior to
the Commitment Date of the amount by which it is willing to increase its Commitment. If the Banks



30









 




notify the Administrative Agent and the Borrower that they are willing to increase the amount of
their respective Commitments by an aggregate amount that exceeds the amount of the requested
Commitment Increase, the requested Commitment Increase shall be allocated among the Banks willing
to participate therein in such amounts as are agreed between the Borrower and the Administrative
Agent.




     (c) Promptly following each Commitment Date, the Administrative Agent shall notify the
Borrower as to the amount, if any, by which the Banks are willing to participate in the requested
Commitment Increase. If the aggregate amount by which the Banks are willing to participate in any
requested Commitment Increase on any such Commitment Date is less than the requested Commitment
Increase, then the Borrower may request Banks to increase their participation and extend offers to
one or more Eligible Assignees to participate in any portion of the requested Commitment Increase
that has not been committed to by the Lenders as of the applicable Commitment Date;
provided, however, that the Revolving Commitment of each such Eligible Assignee
shall be in an amount not less than $10,000,000.



     (d) On each Increase Date, each Eligible Assignee that accepts an offer to participate in a
requested Commitment Increase in accordance with Section 2.6(b) (each such Eligible Assignee, an
“Assuming Bank”) shall become a Bank party to this Agreement as of such Increase Date and
the Commitment of each Increasing Bank for such requested Commitment Increase shall be so increased
by such amount (or by the amount allocated to such Bank pursuant to the last sentence of Section
2.6(b)) as of such Increase Date; provided, however, that the Administrative Agent
shall have received on or before such Increase Date the following, each dated such date:




     (i) (A) certified copies of resolutions of the Board of Directors (or other
governing body) of the Borrower or the Executive Committee of such Board (or other
governing body) approving the Commitment Increase and the corresponding
modifications to this Agreement and (B) opinions of counsel for the Borrower (which
may be in-house counsel), in form and substance reasonably acceptable to the
Administrative Agent, covering the matters covered by the opinions of counsel
delivered pursuant to Section 5.1(c);




     (ii) an assumption agreement from each Assuming Bank, if any, substantially in
the form of Exhibit E hereto (each an “Assumption Agreement”), duly
executed by such Eligible Assignee, the Administrative Agent and the Borrower; and




     (iii) confirmation from each Increasing Bank of the increase in the amount of
its Commitment in a writing satisfactory to the Borrower and the Administrative
Agent.


On each Increase Date, upon fulfillment of the conditions set forth in the immediately preceding
sentence of this Section 2.6(d), the Administrative Agent shall notify the Banks (including,
without limitation, each Assuming Bank) and the Borrower, on or before 1:00 P.M. (New York City
time), by telecopier, of the occurrence of the Commitment Increase to be effected on such Increase
Date and shall record in the Register the relevant information with respect to each Increasing Bank
and each Assuming Bank on such date.




31









 








     (e) The Administrative Agent shall promptly notify the Borrower and the Banks of any increase
in the amount of the aggregate Commitments pursuant to this Section and of the respective adjusted
Commitment and Revolving Percentage of each Bank after giving effect thereto. The Borrower
acknowledges that, in order to maintain the Revolving Percentage of each Bank, a non-pro-rata
increase in the aggregate Commitments may require prepayment or funding of all or portions of
certain Loans on the date of such increase (and any such prepayment or funding shall be subject to
the other provisions of this Agreement). Effective upon such increase, the amount of the
participations held by each Bank in each Letter of Credit then outstanding shall be adjusted such
that, after giving effect to such adjustments, each Bank shall hold participations in each such
Letter of Credit in accordance with the Revolving Percentage of such Bank after giving effect to
such increase.



     SECTION
2.7. Extension Option. The Borrower may request that the Commitments be extended for additional
one year periods by providing not less than 30 days’ written notice (the date of such notice, a
“Notice Date”) to the Administrative Agent prior to any anniversary of the Closing Date.
If a Lender agrees, in its individual and sole discretion, to extend its Commitment (such Lender,
an “Extending Lender”), it will notify the Administrative Agent, in writing, of its
decision to do so no later than 20 days after the applicable Notice Date. The Administrative Agent
will notify the Borrower, in writing, of the Lenders’ decisions no later than 25 days after such
Notice Date. The Extending Lenders’ Commitments will be extended for an additional year from the
Termination Date (the “Extended Termination Date”) or the Extended Termination Date (the
“Second Extended Termination Date”); provided that (i) more than 50% of the Commitments is
extended or otherwise committed to by Extending Lenders and any new Lenders and (ii) on the date of
any request by the Borrower to extend the Commitments, the applicable conditions set forth in
Section 5.2 shall be satisfied. No Lender shall be required to consent to any such extension
request and any Lender that declines or does not respond to the Borrower’s request for commitment
renewal (a “Declining Lender”) will have its Commitment terminated on the then existing
Termination Date (without regard to any renewals by other Lenders). The Borrower will have the
right to accept commitments from Eligible Assignees in an amount equal to the amount of the
Commitments of any Declining Lenders; provided that the Extending Lenders will have the right to
increase their Commitments up to the amount of the Declining Lenders’ Commitments before the
Borrower will be permitted to substitute any Eligible Assignees for the Declining Lenders. The
Borrower may only extend the Termination Date twice during the term of this Agreement pursuant to
this Section 2.7.



ARTICLE III




PROVISIONS RELATING TO ALL LOANS




     SECTION
3.1. Evidence of Loans. (a) Each Bank shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of the Borrower to such Bank resulting from
each Loan made by such Bank from time to time, including, without limitation, the amounts of
principal and interest payable and paid to such Bank from time to time under this Agreement.



     (b) The Administrative Agent shall maintain the Register pursuant to Section 10.6(d) and a
subaccount therein for each Bank, in which shall be recorded (i) the amount of each Loan made



32









 




by
each Bank through the Administrative Agent hereunder, the type thereof and each Interest Period
applicable thereto, (ii) the amount of any principal or interest due and payable or to become due
and payable from the Borrower to each Bank hereunder and (iii) both the amount of any sum received
by the Administrative Agent hereunder from the Borrower and each Bank’s share thereof.




     (c) The entries made in the Register and the accounts of each Bank maintained pursuant to
Section 3.1(a) shall, to the extent permitted by applicable law, be prima facie
evidence of the existence and amount of the obligations of the Borrower therein recorded;
provided, however, that the failure of any Bank or the Administrative Agent to
maintain the Register or any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans actually made to the
Borrower by such Bank in accordance with the terms of this Agreement.



     SECTION
3.2. Fees. (a) The Borrower agrees to pay to the Administrative Agent for the account of
each Bank the Commitment Fee, from the date hereof until such date that the Loans and other
obligations under this Agreement have been paid in full, payable quarterly in arrears on the last
day of each March, June, September and December until such date that the Loans and other
obligations under this Agreement have been paid in full and on such date of payment in full.



     (b) The Borrower agrees to pay to the Administrative Agent for the account of each Bank the
applicable Utilization Fee on the Outstanding Extensions of Credit of such Bank at any time that
the Total Outstanding Extensions of Credit outstanding shall exceed 50% of the Total Commitments
then in effect, payable quarterly in arrears on the last day of each March, June, September and
December.



     (c) The fees payable under Sections 3.2(a) and 3.2(b) shall be calculated by the
Administrative Agent on the basis of a 365- or 366-day year, as the case may be, for the actual
days (including the first day but excluding the last day) occurring in the period for which such
fee is payable.



     (d) The Borrower shall pay to the Administrative Agent, for its own account, the fees in the
amounts and on the dates previously agreed to in writing by the Borrower and the Administrative
Agent.



     SECTION
3.3. Interest. The Borrower shall pay interest on the unpaid principal amount of each Loan
made by each Bank from the date of such Loan until such principal amount shall be paid in full, at
the times and at the rates per annum set forth below:



     (a) ABR Loans. Each ABR Loan (excluding each Swingline Loan) shall bear interest at a
rate per annum equal at all times to the lesser of (i) the ABR plus the Applicable Margin
and (ii) the Highest Lawful Rate, payable quarterly in arrears on the last day of each March, June,
September and December and on the Termination Date.



     (b) LIBOR Rate Loans. Each LIBOR Rate Loan shall bear interest at a rate per annum
equal at all times to, in the case of each LIBOR Rate Loan, the lesser of (A) the sum of the LIBOR
Rate for the applicable Interest Period for such Loan plus the Applicable Margin and



33









 




(B) the Highest Lawful Rate, payable on the last day of such Interest Period and, with respect
to Interest Periods of six months or longer, on the ninetieth (90th) day after the commencement of
the Interest Period and on each succeeding ninetieth (90th) day during such Interest Period, and on
the Termination Date.




     (c) Swingline Loans. Each Swingline Loan shall bear interest at a rate per annum
equal to the lesser of (i)(A) the ABR plus the Applicable Margin or (B) the Money Market
Rate, at the election of the Borrower pursuant to Section 2.4, and (ii) the Highest Lawful Rate,
payable quarterly in arrears on the last day of each March, June, September and December and on the
date of payment of such Swingline Loan.



     (d) Calculations. Interest that is determined by reference to the ABR shall be
calculated by the Administrative Agent on the basis of a 365- or 366-day year, as the case may be,
for the actual days (including the first day but excluding the last day) occurring in the period in
which such interest is payable and otherwise shall be calculated by the Administrative Agent on the
basis of a 360-day year for the actual days (including the first day and excluding the last day)
occurring in the period for which such interest is payable.



     (e) Default Rate. Notwithstanding the foregoing, if all or a portion of (i) the
principal amount of any Loan or Reimbursement Obligation, (ii) any interest payable thereon, or
(iii) any Commitment Fee, Utilization Fee or other amount payable hereunder shall not be paid when
due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear
interest, payable from time to time on demand, at a rate per annum equal to the lesser of (A) the
Highest Lawful Rate and (B) the Default Rate, in each case from the date of such non-payment until
such amount is paid in full (as well after as before judgment).



     (f) Determination Conclusive. Each determination of an interest rate by the
Administrative Agent pursuant to any provisions of this Agreement shall be conclusive and binding
on the Borrower and the Banks in the absence of manifest error. The Administrative Agent shall, at
the request of the Borrower, deliver to the Borrower a statement showing in
reasonable detail the quotations used by the Administrative Agent in determining the LIBOR
Rate.



     SECTION
3.4. Reserve Requirements. (a) The Borrower agrees to pay to each Bank that requests
compensation under this Section 3.4 in accordance with the provisions set forth in Section 4.8(b),
so long as such Bank shall be required to maintain reserves against “Eurocurrency liabilities”
under Regulation D of the Board (or, so long as such Bank shall be required by the Board or by any
other Governmental Authority to maintain reserves against any other category of liabilities that
includes deposits by reference to which the interest rate on LIBOR Rate Loans is determined as
provided in this Agreement or against any category of extensions of credit or other assets of such
Bank that includes any LIBOR Rate Loans), an additional amount (determined by such Bank and
notified to the Borrower pursuant to the provisions set forth in Section 4.8(b)) representing such
Bank’s calculation or, if an accurate calculation is impracticable, reasonable estimate (using such
method of allocation to such Loans of the Borrower as such Bank shall determine in accordance with
Section 4.8(a)) of the actual costs, if any, incurred by such Bank during the relevant Interest
Period as a result of the



34









 




applicability of the foregoing reserves to such LIBOR Rate Loans, which
amount in any event shall not exceed the product of the following for each day of such Interest
Period:





     (i) the principal amount of the relevant LIBOR Rate Loans made by such Bank outstanding
on such day;




     (ii) the difference between (A) a fraction, the numerator of which is the LIBOR Rate
(expressed as a decimal) applicable to such LIBOR Rate Loan (expressed as a decimal), and
the denominator of which is one minus the maximum rate (expressed as a decimal) at which
such reserve requirements are imposed by the Board or other Governmental Authority on such
date, minus (B) such numerator; and




     (iii) a fraction, the numerator of which is one and the denominator of which is 360.



     (b) The agreements in this Section 3.4 shall survive the termination of this Agreement and the
payment of all amounts payable hereunder; provided, however, that in no event shall
the Borrower be obligated to reimburse or compensate any Bank for amounts contemplated by this
Section 3.4 for any period prior to the date that is 90 days before the date upon which such Bank
requests in writing such reimbursement or compensation from the Borrower.



     SECTION
3.5. Interest Rate Determination and Protection. (a) The rate of interest for each LIBOR
Rate Loan shall be determined by the Administrative Agent two Business Days before the first day of
each Interest Period applicable to such Loan. The Administrative Agent shall give prompt notice to
the Borrower and the Banks of the applicable interest rate determined by the Administrative Agent
for purposes of Sections 3.3(a) and (b) hereof.



     (b) If, with respect to any LIBOR Rate Loans, prior to the first day of an Interest Period (i)
the Administrative Agent shall have determined (which determination shall be conclusive and binding
upon the Borrower) that, by reason of circumstances affecting the London interbank market, adequate
and reasonable means do not exist for ascertaining the LIBOR Rate for such Interest Period or (ii)
the Administrative Agent shall have received notice from the Majority Banks that the LIBOR Rate
determined or to be determined for such Interest Period will not adequately and fairly reflect the
cost to such Banks (as determined in good faith and certified by such Banks) of making or
maintaining their affected LIBOR Rate Loans during such Interest Period, the Administrative Agent
shall give facsimile or telephonic notice thereof (with written notice to follow promptly) to the
Borrower and the Banks as soon as practicable thereafter. If such notice is given, (A) any LIBOR
Rate Loans requested to be made on the first day of such Interest Period shall be made as ABR
Loans, (B) any Loans that were to have been converted on the first day of such Interest Period to
LIBOR Rate Loans shall be continued as ABR Loans and (C) any outstanding LIBOR Rate Loans shall be
converted, on the first day of such Interest Period, to ABR Loans. Until such notice has been
withdrawn by the Administrative Agent, no further LIBOR Rate Loans shall be made or continued as
such, nor shall the Borrower have the right to convert Loans to LIBOR Rate Loans.



     SECTION
3.6. Voluntary Interest Conversion or Continuation of Loans. (a) The Borrower may on any
Business Day, upon the Borrower’s irrevocable oral or written notice



35









 




of interest
conversion/continuation given by the Borrower to the Administrative Agent not later than 11:00 A.M.
(New York City time) on the third Business Day prior to the date of the proposed interest
conversion or continuation in the case of a LIBOR Rate Loan, (i) convert Loans of one Type into
Loans of another Type; (ii) convert LIBOR Rate Loans for a specified Interest Period into LIBOR
Rate Loans for a different Interest Period; or (iii) continue LIBOR Rate Loans for a specified
Interest Period as LIBOR Rate Loans for the same Interest Period; provided,
however, that (A) any conversion of any LIBOR Rate Loans into LIBOR Rate Loans for a
different Interest Period, or into ABR Loans, or any continuation of LIBOR Rate Loans for the same
Interest Period shall be made on, and only on, the last day of an Interest Period for such LIBOR
Rate Loans; (B) no Loan may be converted into or continued as a LIBOR Rate Loan by the Borrower so
long as an Event of Default has occurred and is continuing, and (C) no Loan may be converted into
or continued as a LIBOR Rate Loan if after giving effect thereto, Section 2.3 would be contravened.
With respect to any oral notice of interest conversion/continuation given by the Borrower under
this Section 3.6(a), the Borrower shall promptly thereafter confirm such notice in writing. Each
written notice of interest conversion/continuation given by the Borrower under this Section 3.6(a)
and each confirmation of an oral notice of interest conversion/continuation given by the Borrower
under this Section 3.6(a) shall be in substantially the form of Exhibit B hereto
(“Notice of Interest Conversion/Continuation”). Each such Notice of Interest
Conversion/Continuation shall specify therein the requested (x) date of such interest conversion or
continuation; (y) the Loans to be converted or continued; and (z) if such interest conversion or
continuation is into LIBOR Rate Loans, the duration of the Interest Period for each such LIBOR Rate
Loan. Upon receipt of any such Notice of Interest Conversion/Continuation, the Administrative Agent
shall promptly notify each Bank thereof. Each Notice of Interest Conversion/ Continuation shall be
irrevocable and binding on the Borrower. This Section shall not apply to Swingline Borrowings,
which may not be converted or continued.




     (b) If the Borrower shall fail to deliver to the Administrative Agent a Notice of Interest
Conversion/Continuation in accordance with Section 3.6(a) hereof, or to select the duration of any
Interest Period for the principal amount outstanding under any LIBOR Rate Loan by 11:00 A.M. (New
York City time) on the third Business Day prior to the last day of the Interest Period applicable
to such Loan in accordance with Section 3.6(a), the Administrative Agent will forthwith so notify
the Borrower and the Banks (provided that the failure to give such notice shall not affect
the conversion referred to below) and such Loans will automatically, on the last day of the then
existing Interest Period therefor, convert into LIBOR Rate Loans with a one month Interest Period.



     SECTION
3.7. Funding Losses Relating to LIBOR Rate Loans. (a) The Borrower agrees, without
duplication of any other provision under this Agreement, to indemnify each Bank and to hold each
Bank harmless from any loss or expense that such Bank may sustain or incur as a consequence of (i)
default by the Borrower in payment when due of the principal amount of or interest on any LIBOR
Rate Loan, (ii) default by the Borrower in making a borrowing of, conversion into or continuation
of any LIBOR Rate Loan after the Borrower has given a notice requesting the same in accordance with
the provisions of this Agreement, (iii) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this Agreement or (iv) the
making of a prepayment of LIBOR Rate Loans or the conversion of LIBOR Rate Loans into ABR Loans, on
a day that is not the last day of an Interest Period with respect thereto (excluding any prepayment
made pursuant to Section 3.8) on



36









 




a day that is not the scheduled maturity date with respect
thereto, including, without limitation, in each case, any such loss or expense arising from the
reemployment of funds obtained by it or from fees payable to terminate the deposits from which such
funds were obtained. The calculation of all amounts payable to a Bank under this Section 3.7(a)
shall be made pursuant to the method described in Section 4.8(a), but in no event shall such
amounts payable with respect to any LIBOR Rate Loan exceed the amounts that would have been payable
assuming such Bank had actually funded its relevant LIBOR Rate Loan through the purchase of a
deposit bearing interest at the LIBOR Rate in an amount equal to the amount of such LIBOR Rate Loan
and having a maturity comparable to, with respect to any LIBOR Rate Loan, the relevant Interest
Period, provided, that each Bank may fund each of its LIBOR Rate Loans in any manner it
sees fit, and the foregoing assumption shall be utilized only for the calculation of amounts
payable under this Section 3.7(a).




     (b) The agreements in this Section 3.7 shall survive the termination of this Agreement and the
payment of all amounts payable hereunder; provided, however, that in no event shall
the Borrower be obligated to reimburse or compensate any Bank for amounts contemplated by this
Section 3.7 for amounts accruing prior to the date that is 90 days prior to the date upon which
such Bank requests in writing such reimbursement or compensation from the Borrower.



     SECTION
3.8. Change in Legality. (a) Notwithstanding any other provision of this Agreement, if
any Bank shall notify the Administrative Agent that it has determined in good faith that the
introduction of or any change in or in the interpretation or application of any law or regulation
by any Governmental Authority (in each case occurring after the date of this Agreement) makes it
unlawful, or any central bank or other Governmental Authority asserts after the date of this
Agreement that it is unlawful, for any Bank or its applicable lending office to perform its
obligations hereunder to make LIBOR Rate Loans or to fund or maintain LIBOR Rate Loans hereunder,
(i) the obligation of such Bank to make, or to convert Loans into, or to continue LIBOR Rate Loans
as, LIBOR Rate Loans shall be suspended until the Administrative Agent shall notify the Borrower
that the circumstances causing such suspension no longer exist; (ii) the Borrower shall, at its
option, either prepay in full all LIBOR Rate Loans of such Bank then outstanding, or convert all
such Loans to ABR Loans, on the respective last days of the then current Interest Periods with
respect to such Loans (or within such earlier period as required by law), accompanied, in the case
of any prepayments, by interest accrued thereon and any amounts payable under Section 3.7(a). Each
Bank agrees that it will use reasonable efforts to designate a different lending office for the
LIBOR Rate Loans due to it affected by this Section 3.8, if such designation will avoid the
illegality described in this Section 3.8 so long as such designation will not be disadvantageous to
such Bank as determined by such Bank in its sole discretion acting in good faith.



     (b) For purposes of this Section 3.8, a notice to the Borrower (with a copy to the
Administrative Agent) by any Bank pursuant to paragraph (a) above shall be effective on the date of
receipt thereof by the Borrower.




37










 





ARTICLE IV




INCREASED COSTS, TAXES, PAYMENTS




AND PREPAYMENTS




     SECTION
4.1. Increased Costs; Capital Adequacy. (a) If after the date of this Agreement the
adoption of or any change in any law or regulation or in the interpretation or application thereof
by any Governmental Authority or application thereof or compliance by any Bank with any request or
directive (whether or not having the force of law) from any central bank or other Governmental
Authority made subsequent to the date of this Agreement:




     (i) shall impose, modify or hold applicable any reserve, special deposit, compulsory
loan or similar requirement against assets held by, deposits or other liabilities in or for
the account of, advances, loans or other extensions of credit by, or any other acquisition
of funds by, any office of such Bank that is not otherwise included in the determination of
the LIBOR Rate hereunder (except for amounts covered by Section 3.4 or any other Section
hereof); or




     (ii) shall impose on such Bank any other condition;


and the result of any of the foregoing is to increase the actual cost to such Bank, by an amount
that such Bank deems to be material, of making, converting into, continuing or maintaining LIBOR
Rate Loans or issuing or participating in Letters of Credit or to reduce any amount receivable
hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay such Bank,
upon its demand in the manner set forth in Section 4.8(b), any additional amounts, computed by such
Bank in accordance with Section 4.8(a), necessary to compensate such Bank for such actual increased
cost or reduced amount receivable that is attributable to Loans or Commitments (to the extent that
such Bank has not already been compensated or reimbursed for such amounts pursuant to any other
provision of this Agreement). If any Bank becomes entitled to claim any additional amounts pursuant
to this Section 4.1(a) from the Borrower, it shall promptly notify the Borrower, through the
Administrative Agent, of the event by reason of which it has become so entitled in the manner set
forth in Section 4.8(b).




     (b) If any Bank determines in good faith that the introduction of or any change in or in the
interpretation or application by any Governmental Authority of any law or regulation regarding
capital adequacy after the date of this Agreement or compliance by such Bank or any corporation
controlling such Bank with any law or regulation or any guideline or request from any central bank
or other Governmental Authority (whether or not having the force of law) made or issued after the
date of this Agreement does or shall have the effect, as a result of such Bank’s obligations under
this Agreement or under any Letter of Credit, of reducing the rate of return on such Bank’s or such
corporation’s capital to a level below that which such Bank or such corporation could have achieved
but for such change or compliance (taking into consideration
such Bank’s or such corporation’s policies with respect to capital adequacy) by an amount
deemed by such Bank to be material, the Borrower shall pay to the Administrative Agent for the
account of such Bank, from time to time as specified by such Bank in the manner set forth in
Section 4.8(b), additional amounts, computed by such Bank in accordance with Section 4.8(a),



38









 




sufficient to compensate such Bank or such corporation in the light of such circumstances, to the
extent that such Bank reasonably determines such reduction in rate of return is allocable to the
existence of such Bank’s obligations hereunder.




     (c) The agreements contained in this Section 4.1 shall survive the termination of this
Agreement and the payment of all amounts payable hereunder; provided, however, that
in no event shall the Borrower be obligated to reimburse or compensate any Bank for amounts
contemplated by this Section 4.1 for any period prior to the date that is 90 days prior to the date
upon which such Bank requests in writing such reimbursement or compensation from the Borrower.



     SECTION
4.2. Pro Rata Treatment and Payments and Computations. (a) Each Borrowing of Loans by the
Borrower from the Banks hereunder, each payment by the Borrower on account of any commitment or
other fee, any reduction of the Commitments of the Banks and any prepayment on account of principal
and interest on the Loans shall be made pro rata according to the respective
Revolving Percentages of the Banks.



     (b) The Borrower shall make each payment (including each prepayment) hereunder, whether on
account of principal, interest, fees or otherwise, without setoff or counterclaim, not later than
12:00 Noon (New York City time) on the day when due in Dollars to the Administrative Agent at the
Funding Office in immediately available funds, except payments to be made directly to the Swingline
Lender as expressly provided herein. The Administrative Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal, interest, Letter of Credit fees or
commitment or other fees (to the extent received by the Administrative Agent) ratably to the Banks
according to the amounts of their respective Loans, L/C Obligations and Commitments in respect of
which such payment is made, and like funds relating to the payment of any other amount payable to
any Bank (to the extent received by the Administrative Agent) to such Bank, in each case to be
applied in accordance with the terms of this Agreement.



     (c) Whenever any payment hereunder or under the Notes shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of payment of interest or fees,
as the case may be; provided, however, if such extension would cause payment of
interest on or principal of LIBOR Rate Loans to be made in the next following calendar month, such
payment shall be made on the next preceding Business Day.



     (d) Unless the Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Banks hereunder that the Borrower will not make such
payment in full, the Administrative Agent may assume that the Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon
such assumption, cause to be distributed to each Bank on such due date an amount
equal to the amount then due such Bank. If and to the extent the Borrower shall not have so
made such payment in full to the Administrative Agent, each Bank shall pay to the Administrative
Agent on demand an amount equal to the product of (i) the daily average Federal Funds Effective
Rate during such period, times (ii) the amount of such Bank’s Revolving Percentage of such payment,
times (iii) a fraction, the numerator of which is the number of days that elapse from



39









 




and including the date such amount is distributed to such Bank to the date on which such Bank’s Revolving
Percentage of such payment shall have become immediately available to the Administrative Agent and
the denominator of which is 360.




     SECTION
4.3. Taxes. (a) Any and all payments by the Borrower hereunder or under the Loan
Documents shall be made free and clear of and without deduction or withholding for or on account of
any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Bank and the Administrative Agent,
net income taxes, branch profits taxes and franchise taxes imposed on it as a result of a present
or former connection between the jurisdiction (or political subdivision thereof) of the government
or taxing authority imposing such tax and the Administrative Agent or such Bank other than a
connection arising solely from the Administrative Agent or such Bank having executed, delivered or
performed its obligations or received a payment under, or enforced, this Agreement or any Note (all
such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as “Taxes”). If the Borrower shall be required by law to deduct
any Taxes from or in respect of any sum payable hereunder or under any Note to any Bank or the
Administrative Agent, (i) the sum payable shall be increased as may be necessary so that after
making all required deductions (including deductions applicable to additional sums payable under
this Section 4.3) such Bank or the Administrative Agent (as the case may be) receives an amount
equal to the sum it would have received had no such deductions been made; (ii) the Borrower shall
make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law; provided,
however, that the Borrower shall not be required to increase any such sums payable to any
Bank with respect to any Taxes (i) that are attributable to such Bank’s failure to comply with the
requirements of Section 4.3(d) or (ii) that are United States withholding taxes imposed on sums
payable to such Bank at the time such Bank becomes a party to this Agreement (or maintains a
lending office), except to the extent that any such Bank’s assignor (if any) was entitled, at the
time of assignment, to receive additional amounts from the Borrower with respect to such Taxes
pursuant to this Section 4.3. Whenever any Taxes or Other Taxes (as defined in Section 4.3(b)) are
payable by the Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for the account of the relevant Bank or Administrative Agent, as the case may
be, either (A) official tax receipts or notarized copies of such receipts to such Bank within
thirty (30) days after payment of any applicable tax or (B) a certificate executed by a Responsible
Officer of the Borrower confirming that such Taxes or Other Taxes have been paid, together with
evidence of such payment.



     (b) In addition, the Borrower agrees to pay any present or future stamp or documentary taxes
or any other excise or property taxes, charges or similar levies that arise from any payment made
hereunder or under any Note or from the execution, delivery or registration of or otherwise with
respect to, this Agreement, any other Loan Document, or the Loans and for which such
Bank or the Administrative Agent (as the case may be) has not been otherwise reimbursed by the
Borrower under this Agreement (hereinafter referred to as “Other Taxes”).



     (c) The Borrower will indemnify each Bank and the Administrative Agent for the full amount of
Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 4.3) paid by such Bank or the Administrative
Agent (as the case may be) and any liability (including penalties, interest and



40









 




expenses) arising
therefrom or with respect thereto, including, without limitation or duplication, any incremental
taxes, interest or penalties that may become payable by the Administrative Agent or any Bank as a
result of any failure by the Borrower to pay any Taxes or Other Taxes when due to the appropriate
taxing authority or to remit to any Bank the receipts or other evidence of payment of Taxes or
Other Taxes.




     (d) Each Bank registered in the Register that is not a U.S. Person as defined in Section
7701(a)(30) of the Code agrees that it will deliver to the Borrower and the Administrative Agent on
the date hereof, or on the date which it becomes a party to this Agreement, two duly completed
copies of United States Internal Revenue Service Form W-8BEN, W-8ECI W-8EXP or W-8IMY (or other
appropriate corresponding form) or any successor applicable form, as the case may be. Each such
Bank also agrees to deliver to the Borrower and the Administrative Agent two further copies of the
said Form W-8BEN, W-8ECI, W-8EXP, or W-8IMY or successor applicable forms or other manner of
certification, as the case may be, on or before the date that any such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most recent form or
certification previously delivered by it to the Borrower, and such extensions or renewals thereof
as may reasonably be requested by the Borrower or the Administrative Agent, unless in any such case
an event (including, without limitation, any change in treaty, law or regulation) has occurred
prior to the date on which any such delivery would otherwise be required that renders all such
forms inapplicable or that would prevent such Bank from duly completing and delivering any such
form with respect to it and such Bank so advises the Borrower and the Administrative Agent. Each
such Bank shall certify in the case of a Form W-8BEN, W-8ECI, W-8EXP, or W-8IMY that it is entitled
to receive payments under this Agreement without deduction or withholding of any United States
federal income taxes, subject to notification to the Borrower otherwise pursuant to this Section
4.3(d). In the event that any such Bank fails to deliver any forms required under this Section
4.3(d), the Borrower’s obligation to pay additional amounts shall be reduced to the amount that it
would have been obligated to pay had such forms been provided.



     (e) If any Taxes or Other Taxes are not correctly or legally asserted and the Administrative
Agent or any Bank determines, in its reasonable discretion, that it has received a refund of those
Taxes or Other Taxes as to which it has been indemnified by the Borrower, the Administrative Agent
or such Bank shall within 20 days after such refund pay to the Borrower the amount of such refund
to the extent that the Borrower indemnified the Administrative Agent or such Bank for such Taxes or
Other Taxes pursuant to this Section 4.3, net of any out-of-pocket costs of the Administrative
Agent or such Bank and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); provided, that the Borrower, upon the request of
the Administrative Agent or such Bank, agrees to repay the amount paid over to the Borrower (plus
any penalties, interest or other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Bank in the event the
Administrative Agent or such Bank is required to repay such refund to such Governmental
Authority. This paragraph shall not be construed to require the Administrative Agent or any Bank to
make available its tax returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.



     (f) The agreements in this Section 4.3 shall survive the termination of this Agreement and the
payment of all amounts payable hereunder; provided, however, that (i) in no event
shall

41









 







the Borrower be obligated to reimburse or compensate any Bank for amounts contemplated by
this Section 4.3 for any period before the date that is 120 days before the date upon which such
Bank requests in writing such reimbursement or compensation from the Borrower (other than any
amounts as to which the ultimate amount of the reimbursement due could not then be determined) and
(ii) nothing contained in this Section 4.3 shall require the Borrower to pay any amount to any Bank
or the Administrative Agent in addition to that for which it has already reimbursed any Bank or the
Administrative Agent under any other provision of this Agreement.




     SECTION
4.4. Sharing of Payments, Etc. If any Bank (a “Benefitted Bank”) shall at any time
receive any payment (other than pursuant to Section 2.7, 3.4, 3.7, 4.1 or 4.3) of all or part of
its Loans, Reimbursement Obligations or participations in Swingline Loans owing to it or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by
setoff, pursuant to events or proceedings of the nature referred to in Section 8.1(g) or 8.1(h), or
otherwise), in a greater proportion than any such payment to or collateral received by any other
Bank, if any, in respect of such other Bank’s Loans, Reimbursement Obligations owing to it,
respectively, or interest thereon, such benefitted Bank shall purchase for cash from the other
Banks a participating interest in such portion of each such other Bank’s Loans or Reimbursement
Obligations owing to it, respectively, or shall provide such other Banks with the benefits of any
such collateral, or the proceeds thereof, as shall be necessary to cause such benefitted Bank to
share the excess payment or benefits of such collateral or proceeds ratably with each of the Banks;
provided, however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefitted Bank, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without interest. The Borrower
agrees that any Bank so purchasing a participation from another Bank pursuant to this Section 4.4
may, to the fullest extent permitted by law, exercise all its rights of payment (including the
right of setoff) with respect to such participation as fully as if such Bank were the direct
creditor of the Borrower in the amount of such participation.



     SECTION
4.5. Optional Termination or Reduction of the Commitments. (a) Unless previously
terminated, the Commitments of the Banks to make Loans shall terminate on the Termination Date.



     (b) The Borrower shall have the right, without penalty or premium, upon at least three (3)
Business Days’ irrevocable written notice to the Administrative Agent (which shall give prompt
notice to each Bank), to terminate in whole the Commitments or permanently, from time to time, to
reduce ratably in part the unused portion of the Commitments, provided that (i) each
partial reduction shall be in the aggregate principal amount of $5,000,000 or an integral multiple
of $1,000,000 in excess thereof and (ii) no such termination or reduction shall be permitted if,
after giving effect thereto and to any prepayments made under Section 4.6 by the Borrower on the
effective date thereof, the Total Outstanding Extensions of Credit then outstanding would exceed
the Total Commitments then in effect.



          Each reduction of Commitments pursuant to this Section 4.5 shall be applied pro rata to the
Commitments of each Bank. If at any time, including after giving effect to any reduction of
Commitments pursuant to this Section 4.5, the Total Outstanding Extensions of Credit exceed the
Total Commitments, the Borrower shall be obligated, first, to prepay the Loans in the
amount of such excess, second, to cash collateralize Letters of Credit to the extent that
the



42









 




aggregate amount of the L/C Obligations exceeds such Total Commitments after prepayment of all
Loans.




     SECTION
4.6. Voluntary Prepayments. The Borrower may, upon written notice delivered to the
Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) not
later than 11:00 A.M. (New York City time) on the same Business Day (or in the case of LIBOR Rate
Loans, two (2) Business Days (or such shorter or no notice as may be satisfactory to the
Administrative Agent), and in the case of prepayment of a Swingline Loan, not later than 12:00
noon, New York City time, on the date of prepayment) before the date of prepayment stating the
aggregate principal amount of the prepayment and the Loans to be prepaid, prepay the outstanding
principal amounts of such Loans comprising part of the same Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the principal amount prepaid;
provided, however, that losses incurred by any Bank under Section 3.7 shall be
payable with respect to each such prepayment in the manner set forth in Section 3.7. Any such
notice provided pursuant to this Section 4.6 shall be irrevocable, and the payment amount specified
in such notice shall be due and payable on the prepayment date described in such notice, together
with accrued and unpaid interest on the amount prepaid. Partial prepayments pursuant to this
Section 4.6 with respect to any Tranche of LIBOR Rate Loans shall be in an aggregate principal
amount equal to the lesser of (a) $5,000,000 or an integral multiple of $1,000,000 in excess
thereof and (b) the aggregate principal amount of such Tranche of LIBOR Rate Loans then
outstanding, as the case may be; provided that no partial prepayment of any Tranche of
LIBOR Rate Loans may be made if, after giving effect thereto, Section 2.3 would be contravened.
Partial prepayments with respect to the ABR Loans shall be made in an aggregate principal amount
equal to the lesser of (i) $5,000,000 or an integral multiple of $1,000,000 in excess thereof or
(ii) the aggregate principal amount of ABR Loans then outstanding, as the case may be.



     SECTION
4.7. Mitigation of Losses and Costs. Any Bank claiming reimbursement from the Borrower
under any of Sections 3.4, 3.7, 4.1 and 4.3 hereof shall use reasonable efforts (including, without
limitation, if requested by the Borrower, reasonable efforts to designate a different lending
office of such Bank) to mitigate the amount of such losses, costs, expenses and liabilities, if
such efforts can be made and such mitigation can be accomplished without such Bank suffering (i)
any economic disadvantage for which such Bank does not receive full indemnity from the Borrower
under this Agreement or (ii) any legal or regulatory disadvantage.



     SECTION
4.8. Determination and Notice of Additional Costs and Other Amounts. (a) In determining the
amount of any claim for reimbursement or compensation under Sections 3.4, 3.7 and 4.1, each Bank
may use any reasonable averaging, attribution and allocation methods consistent with such methods
customarily employed by such Bank in similar situations.



     (b) Each Bank or, with respect to compensation claimed by it pursuant to Section 4.3, the
Administrative Agent, as the case may be, will (i) use its best efforts to notify the Borrower
through the Administrative Agent (in the case of each Bank) of any event occurring after the date
of this Agreement promptly after the occurrence thereof and (ii) notify the Borrower through the
Administrative Agent (in the case of each Bank) promptly after such Bank or the Administrative
Agent, as the case may be, becomes aware of any event occurring after the date of this Agreement,
in either case if such event (for purposes of this Section 4.8(b), a “Triggering



43









 




Event”)
will entitle such Bank or the Administrative Agent, as the case may be, to compensation pursuant to
Section 3.4, 3.7, 4.1 or 4.3, as the case may be. Each such notification of a Triggering Event
shall be accompanied by a certificate of such Bank or the Administrative Agent, as the case may be,
setting forth the calculations and justification in reasonable detail such amount or amounts as
shall be necessary to compensate such Bank or the Administrative Agent, as the case may be, as
specified in Section 3.4, 3.7, 4.1 or 4.3, as the case may be, and certifying that such costs are
generally being charged by such Bank to other similarly situated borrowers under similar credit
facilities, which certificate shall be conclusive absent manifest error. The Borrower shall pay to
the Administrative Agent for the account of such Bank or to the Administrative Agent for its own
account, as the case may be, the amount shown as due on any such certificate within ten Business
Days after its receipt of the same.




ARTICLE V




CONDITIONS OF LENDING




     SECTION
5.1. Conditions Precedent to Loans and Letters of Credit. The agreement of each Bank to
make the initial extension of credit requested to be made by it is subject to the satisfaction,
prior to or concurrently with the making of such extension of credit on the Closing Date, of the
following conditions precedent:



     (a) The Administrative Agent (or its counsel) shall have received this Agreement duly executed
by the Borrower and each other party hereto.



     (b) The Administrative Agent (or its counsel) shall have received a certificate dated as of
the Closing Date of the Secretary or an Assistant Secretary of the Borrower certifying (i) the
names and true signatures of the Responsible Officers of the Borrower authorized to sign each Loan
Document to which the Borrower is a party and the notices and other documents to be delivered by
the Borrower pursuant to any such Loan Document; (ii) the operating agreement and certificate of
formation of the Borrower as in effect on the date of such certification; (iii) the resolutions of
the Board of Directors or equivalent thereof of the Borrower approving and authorizing the
execution, delivery and performance by the Borrower of each Loan Document to
which it is a party and any Notes from time to time issued hereunder and authorizing the
borrowings and other transactions contemplated hereunder and (iv) that all material authorizations,
approvals and consents by any Governmental Authority or other Person necessary in connection with
the execution, delivery and performance of the Loan Documents and any other regulatory approvals in
respect thereof required to be obtained prior to the Closing Date, have been obtained and are in
full force and effect.



     (c) The Administrative Agent shall have received an executed legal opinion, dated the Closing
Date, of (i) Baker Botts LLP, special counsel to the Borrower and (ii) Rufus Scott, Esq., deputy
general counsel of the Borrower. Each such legal opinion shall cover such matters incident to the
transactions contemplated by the Loan Documents as the Administrative Agent may reasonably require
and shall otherwise be in form and substance reasonably satisfactory to the Administrative Agent.



44









 





     (d) The Administrative Agent (or its counsel) shall have received a certificate dated on or
about the Closing Date of the Secretary of State of the State of Texas as to the existence and good
standing of the Borrower.



     (e) The Administrative Agent shall have received, for the benefit of the lenders under the
Existing Credit Agreement, all accrued interest and fees, including any commitment fees,
utilization fees and letter of credit fees, due and payable under the Existing Credit Agreement as
of the Closing Date.



     (f) The effectiveness, substantially concurrent with the effectiveness of this Agreement, of
(i) the CenterPoint Facility and (ii) the Resources Facility.



     (g) All governmental and third-party approvals necessary in connection with the execution,
delivery and performance by the Borrower of the Loan Documents shall have been obtained and be in
full force and effect.



     (h) The Administrative Agent shall have received all financial statements and other
information as the Administrative Agent shall reasonably request, including projections and pro
forma balance sheets adjusted to give effect to the financing contemplated hereby and the other
financings described in clause (f) above, and such financial statements shall not, in the
reasonable judgment of the Banks, reflect any material adverse change in the consolidated financial
condition of the Borrower and its Subsidiaries, as reflected in the financial statements or
projections contained in the Confidential Information Memorandum.



     (i) Detailed consolidated projections through the 2011 fiscal year of the Borrower (including
a projected consolidated balance sheet of the Borrower and its Subsidiaries as of the end of each
such fiscal year, the related consolidated statements of projected cash flow, and projected income
and a description of the underlying assumptions applicable thereto) in each case to the extent
provided in the Confidential Information Memorandum.



     (j) The Administrative Agent shall have received all fees required to be paid on or before the
Closing Date.



     (k) All corporate and other proceedings, and all documents, instruments and other legal
matters in connection with the Facility shall be in form and substance reasonably satisfactory to
the Administrative Agent.



     The Administrative Agent shall notify the Borrower and the Banks of the Closing Date, and such
notice shall be conclusive and binding.



     SECTION
5.2. Conditions Precedent to Each Borrowing. The obligation of each Bank to make each
extension of credit (including, to the extent relevant, the initial extensions of credit hereunder)
and each extension of the Commitments pursuant to Section 2.7 hereof is subject to the satisfaction
of the following conditions precedent:



     (a) On or prior to the date of the making of such extension of credit, the Administrative
Agent shall have received from the Borrower a Notice of Borrowing or an Application, as the case
may be, in accordance with the terms of this Agreement, or, in the case of the issuance,



45









 




extension or increase of any Letter of Credit, the instruments required under Section 2.5 in respect thereof.




     (b) The representations and warranties of the Borrower contained in Section 6.1 of this
Agreement and in the other Loan Documents shall be true and correct in all material respects on and
as of the date of such extension of credit (except for (i) those representations or warranties or
parts thereof that, by their terms, expressly relate solely to a specific date, in which case such
representations and warranties shall be true and correct in all material respects as of such
specific date and (ii) at any time after the Closing Date, the representations and warranties
contained in Sections 6.1(j) and (k)), before and after giving effect to such extension of credit,
and to the application of the proceeds therefrom, as though made on and as of such date.



     (c) No Default or Event of Default shall have occurred and be continuing or would result from
such extension of credit.



     (d) Each of the giving of any applicable Notice of Borrowing or Application, as the case may
be, the acceptance by the Borrower of the proceeds of each Borrowing, and each Letter of Credit
issued on behalf of the Borrower, shall constitute a representation and warranty by the Borrower
that on the date of such extension of credit that the conditions contained in this Section 5.2 have
been satisfied.



ARTICLE VI




REPRESENTATIONS AND WARRANTIES




     SECTION
6.1. Representations and Warranties of the Borrower. The Borrower represents and warrants
as follows:



     (a) Organizational Status of the Borrower. The Borrower (i) is validly organized and
existing and in good standing under the laws of its jurisdiction of formation; (ii) is duly
authorized or qualified to do business in and is in good standing in each other jurisdiction
in which the conduct of its business or the ownership or leasing of its Property requires it to be
so authorized or qualified to do business, except where the failure to be so duly authorized or
qualified or in good standing, individually or in the aggregate, would not have a Material Adverse
Effect, and (iii) has the corporate or other requisite power and authority to conduct its business,
as presently conducted.



     (b) Organizational Status of Significant Subsidiaries of the Borrower. Each
Significant Subsidiary of the Borrower (i) is validly organized and existing and in good standing
under the laws of the jurisdiction of its organization and is duly authorized or qualified to do
business in and is in good standing in each other jurisdiction in which the conduct of its business
or the ownership or leasing of its Property requires it to be so authorized or qualified to do
business, except where the failure to be so validly organized and existing or duly authorized or
qualified or in good standing, individually or in the aggregate, would not have a Material Adverse
Effect and (ii) has the corporate, partnership or other requisite power and authority to conduct
its business, as presently conducted, except where the failure to have such power and authority,
individually or in the aggregate, would not have a Material Adverse Effect.



46









 





     (c) Organizational Powers. The Borrower has the corporate or other requisite power to
execute, deliver and perform and comply with its obligations under this Agreement, any Notes and
the other Loan Documents to which it is a party. This Agreement has been, and each other Loan
Document to which the Borrower is a party will be, duly executed and delivered on behalf of the
Borrower.



     (d) Authorization, No Conflict, Etc. The borrowings by the Borrower contemplated by
this Agreement, the execution and delivery by the Borrower of this Agreement and the other Loan
Documents to which it is a party and the performance by the Borrower of its obligations hereunder
and thereunder have been duly authorized by all requisite corporate or other requisite action on
the part of the Borrower and do not and will not (i) violate any law, any order to which the
Borrower or any Significant Subsidiary of the Borrower is subject of any court or other
Governmental Authority, or the articles of incorporation or bylaws or other organizational
documents (each as amended from time to time) of the Borrower or any Significant Subsidiary of the
Borrower; (ii) violate, conflict with, result in a breach of or constitute (with due notice or
lapse of time or both, or any other condition) a default under, any indenture, loan agreement or
other agreement to which the Borrower or any Restricted Subsidiary of the Borrower is a party or by
which the Borrower or any Restricted Subsidiary of the Borrower, or any of their respective
Property, is bound (except for such violations, conflicts, breaches or defaults that, individually
or in the aggregate, do not have or would not have a Material Adverse Effect); or (iii) result in,
or require, the creation or imposition of any material Lien upon any of the Properties of the
Borrower or any Significant Subsidiary not permitted under this Agreement.



     (e) Governmental Approvals and Consents. No authorization or approval or action by,
and no notice to or filing with, any Governmental Authority is required for the due execution,
delivery and performance by the Borrower of, or for the Borrowings under, this Agreement and the
other Loan Documents to which it is a party, except those that have been obtained.



     (f) Obligations Binding. This Agreement and the other Loan Documents to which the
Borrower is a party are the legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their respective terms (assuming due and valid
authorization, execution and delivery of this Agreement by any party other than the Borrower),
except as such enforceability may be (i) limited by the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or affecting the
enforcement of creditors’ rights generally and (ii) subject to the effect of general principles of
equity (regardless of whether such enforceability is considered in a proceeding in equity or at
law).



     (g) Use of Proceeds, Margin Stock. The proceeds of the Loans will be used by the
Borrower (i) to support commercial paper issued by the Borrower and (ii) for other general
corporate purposes. Neither the Borrower nor any Restricted Subsidiary of the Borrower is
principally engaged in, or has as one of its important activities, the business of extending credit
for the purpose of purchasing or carrying any Margin Stock, and no part of the proceeds of any Loan
made to the Borrower will be used for any purpose that would violate the provisions of the margin
regulations of the Board.



47









 





     (h) Title to Properties. The issued and outstanding Capital Stock owned by the
Borrower of each of its Significant Subsidiaries whether such stock is owned directly or indirectly
through one or more of its Subsidiaries, is owned free and clear of any Lien. In addition, each of
the Borrower and each Significant Subsidiary has good title to the Properties reflected in the
financial statements referred to in Section 6.1(m) and in any financial statements delivered
pursuant to Section 7.1(a), except for such Properties that have been disposed of subsequent to the
dates of the balance sheets included in such financial statements and that are no longer used or
useful in the conduct of the business of the Borrower or any Significant Subsidiary or that have
been disposed of pursuant to Section 7.2(c) or (d) or that have been disposed of in the ordinary
course of their respective business, and all such Properties are free and clear of any Lien except
Liens permitted under this Agreement.



     (i) Investment Company Act. Neither the Borrower nor any Restricted Subsidiary of the
Borrower is an “investment company” as defined in, or otherwise subject to regulation under, the
Investment Company Act of 1940, as amended.



     (j) Material Adverse Change. Since December 31, 2006, there has been no event,
development or circumstance that, as of the Closing Date, has or would reasonably be expected to
have a Material Adverse Effect.



     (k) Litigation. As of the Closing Date, there is no litigation, action, suit,
investigation or other legal or governmental proceeding pending or, to the best knowledge of the
Borrower, threatened, at law or in equity, or before or by any arbitrator or Governmental Authority
(i) relating to the transactions under this Agreement or under any other Loan Document or (ii) in
which there is a reasonable possibility of an adverse decision that would have a Material Adverse
Effect.



     (l) ERISA. There is no event or events, individually or in the aggregate, that could
reasonably be expected to have a Material Adverse Effect, arising out of or in connection with (i)
any Reportable Event or “accumulated funding deficiency” (within the meaning of Section 412 of
the Code or Section 302 of ERISA) with respect to any Plan that has occurred during the five-year
period immediately preceding the date on which this representation is made or deemed made, (ii) any
failure of a Plan to comply with the applicable provisions of ERISA and the Code, (iii) any
termination of a Single Employer Plan, (iv) any complete or partial withdrawal by the Borrower or
any Commonly Controlled Entity from any Multiemployer Plan, (v) any Lien in favor of the PBGC or
any Plan that has arisen during the five-year period referred to in clause (i) above or (vi) a
Multiemployer Plan being in Reorganization or being Insolvent.



     (m) Financial Statements. The consolidated financial statements of the Borrower as of
and for the twelve months ended December 31, 2006 filed with the SEC with the Borrower’s 10-K for
the period then ended, copies of which have been delivered to the Banks, present fairly in all
material respects the consolidated financial condition and results of operations of the Borrower,
its Consolidated Subsidiaries, Securitization Subsidiaries and the Unrestricted Subsidiaries as of
such date and for the period then ended, in conformity with, as applicable, GAAP and, except as
otherwise stated therein, consistently applied (in the case of such unaudited statements, subject
to year-end adjustments and the exclusion of detailed footnotes).



48









 





     (n) Accuracy of Information. None of the documents or written information (excluding
estimates, financial projections and forecasts) provided by the Borrower to the Banks in connection
with or pursuant to this Agreement or the other Loan Documents contains as of the date thereof or
will contain as of the date thereof any untrue statement of a material fact or omits or will omit
to state as of the date thereof a material fact (other than industry-wide risks normally associated
with the types of businesses conducted by the Borrower and its Subsidiaries) necessary to make the
statements therein, in the light of the circumstances under which they were made, not materially
misleading, as a whole. The estimates, financial projections and forecasts furnished to the Banks
by the Borrower with respect to the transactions contemplated under this Agreement were prepared in
good faith and on the basis of information and assumptions that the Borrower believed to be
reasonable as of the date of such information; it being recognized by the Banks that such
estimates, financial projections and forecasts as they relate to future events are not to be viewed
as fact and that actual results during the period or periods covered by such estimates, financial
projections and forecasts may differ from the projected results set forth therein by a material
amount.



     (o) No Violation. The Borrower is not in violation of any order, writ, injunction or
decree of any court or any order, regulation or demand of any Governmental Authority that,
individually or in the aggregate, reasonably could be expected to have a Material Adverse Effect.



     (p) Subsidiaries. Schedule 6.1(p) attached hereto sets forth each Significant
Subsidiary as of the date hereof. Except as disclosed on Schedule 6.1(p), as of the date
hereof the Borrower owns, directly or indirectly through one or more of its Subsidiaries, all of
the outstanding Capital Stock of each Significant Subsidiary, in each case free and clear of any
Liens not permitted under this Agreement.



     (q) Taxes. The Borrower and each of its Subsidiaries has filed or caused to be filed
all Federal, state and other material tax returns that are required to be filed and has paid all
taxes shown to be due and payable on said returns or on any assessments made against it or any of
its Property and all other taxes, fees or other charges imposed on it or any of its Property by
any Governmental Authority (other than any the amount or validity of which are currently being
contested in good faith by appropriate proceedings and with respect to which reserves in conformity
with GAAP have been provided on the books of the Borrower or its Subsidiaries), except where the
failure to do so could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; no tax Lien has been filed, and, to the knowledge of the Borrower, no
claim is being asserted, with respect to any such tax, fee or other charges (other than any Liens
or claims that could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect).



ARTICLE VII




AFFIRMATIVE AND NEGATIVE COVENANTS




     SECTION
7.1. Affirmative Covenants. The Borrower covenants that, as long as any amount is owing
hereunder or under any other Loan Documents, any Letter of Credit is outstanding or any Bank shall
have any Commitment outstanding under this Agreement:



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     (a) Delivery of Financial Statements, Notices and Certificates. The Borrower shall
deliver to the Administrative Agent for distribution to the Banks sufficient copies for each of the
Banks of the following:




     (i) as soon as practicable and in any event within 90 days after the end of each fiscal
year of the Borrower (beginning with fiscal 2007), a consolidated balance sheet of the
Borrower, its Consolidated Subsidiaries, Securitization Subsidiaries and the Unrestricted
Subsidiaries as of the end of such fiscal year and the related statements of consolidated
income, retained earnings and cash flows prepared in conformity with GAAP consistently
applied, setting forth in comparative form the figures for the previous fiscal year,
together with a report thereon by independent certified public accountants of nationally
recognized standing selected by the Borrower (which requirement may be satisfied by
delivering the Borrower’s Annual Report on Form 10-K with respect to such fiscal year as
filed with the SEC);




     (ii) as soon as practicable and in any event within 55 days after the end of each of
the first three quarters of each fiscal year of the Borrower (beginning with the quarter
ending June 30, 2007), unaudited consolidated financial statements of the Borrower, its
Consolidated Subsidiaries, Securitization Subsidiaries and the Unrestricted Subsidiaries
consisting of at least consolidated balance sheets as at the close of such quarter and
statements of consolidated income, retained earnings and cash flows for such quarter and for
the period from the beginning of such fiscal year to the close of such quarter (which
requirement may be satisfied by delivering the Borrower’s Quarterly Report on Form 10-Q with
respect to such fiscal quarter as filed with the SEC); such financial statements shall be
accompanied by a certificate of a Responsible Officer of the Borrower to the effect that
such unaudited financial statements present fairly in all material respects the consolidated
financial condition and results of operations of the
Borrower, its Consolidated Subsidiaries, Securitization Subsidiaries and the
Unrestricted Subsidiaries as of such date for the period then ending, and have been prepared
in conformity with GAAP in a manner consistent with the financial statements referred to in
paragraph (a)(i) above (subject to year-end adjustments and exclusion of detailed
footnotes);




     (iii) with each set of statements to be delivered pursuant to Sections 7.1(a)(i) and
(ii) above, a certificate in a form reasonably satisfactory to the Administrative Agent,
signed by a Responsible Officer of the Borrower confirming compliance with Section 7.2(a)
and setting out in reasonable detail the calculations necessary to demonstrate such
compliance as at the date of the most recent balance sheet included in such financial
statements and stating that no Default or Event of Default has occurred and is continuing
or, if there is any Default or Event of Default, describing it and the steps, if any, being
taken to cure it; and




     (iv) (A) within ten days of the filing thereof, copies of all periodic reports (other
than (x) reports on Form 11-K or any successor form, (y) Current Reports on Form 8-K that
contain no information other than exhibits filed therewith and (z) reports on Form 10-Q or
10-K or any successor forms) under the Exchange Act (in each case other than exhibits
thereto and documents incorporated by reference therein)) filed by the



50









 






Borrower with the
SEC; (B) promptly, and in any event within seven (7) Business Days after a Responsible
Officer of the Borrower becomes aware of the occurrence thereof, written notice of (x) any
Event of Default or any Default, (y) the institution of (I) any litigation, action, suit or
other legal or governmental proceeding involving the Borrower or any Restricted Subsidiary
of the Borrower as to which there is a reasonable possibility of an adverse decision that
would have a Material Adverse Effect on the Borrower or (II) any other final adverse
determination in any litigation, action, suit or other legal or governmental proceeding
involving the Borrower or any Significant Subsidiary of the Borrower (1) in the True-Up
Litigation or (2) that would have a Material Adverse Effect or (z) the existence of an event
or events, individually or in the aggregate, that could reasonably be expected to have a
Material Adverse Effect, arising out of or in connection with (1) any Reportable Event with
respect to any Plan, (2) the failure to make any required contribution to a Plan, (3) the
creation of any Lien in favor of the PBGC or a Plan, (4) any withdrawal from, or the
termination, Reorganization or Insolvency of, any Multiemployer Plan or (5) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or any Commonly
Controlled Entity or any Multiemployer Plan with respect to the withdrawal from, or the
termination, Reorganization or Insolvency of, any Plan; (C) with each set of statements
delivered pursuant to Section 7.1(a)(i), a certificate signed by a Responsible Officer of
the Borrower identifying those Subsidiaries which, determined as of the date of such
financial statements, are Significant Subsidiaries and Unrestricted Subsidiaries; and (D)
such other information relating to the Borrower or its business, properties, condition and
operations as the Administrative Agent (or any Bank through the Administrative Agent) may
reasonably request.


Information required to be delivered pursuant to the foregoing Sections 7.1(a)(i), (ii), and
(iv)(A) shall be deemed to have been delivered on the date on which the Borrower provides notice
(including notice by e-mail) to the Administrative Agent (which notice the Administrative Agent
will convey promptly to the Banks) that such information has been posted on the SEC website on the
Internet at sec.gov/edgar/searches.htm or at another website identified in such notice and
accessible by the Banks without charge; provided that (i) such notice may be included in a
certificate delivered pursuant to Section 7.1(a)(iii) and (ii) the Borrower shall deliver paper
copies of such information to the Administrative Agent, and the Administrative Agent shall deliver
paper copies of such information to any Bank that requests such delivery.




     (b) Use of Proceeds. The Borrower will use the proceeds of any Loan or Letter of
Credit made or issued by the Banks or any Issuing Bank to it for the purposes set forth in Section
6.1(g), and it will not use the proceeds of any Loan or Letter of Credit made or issued by the
Banks or any Issuing Bank for any purpose that would violate the provisions of the margin
regulations of the Board. The Borrower will not, and will not permit any of its Subsidiaries to
engage principally, or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying, within the meaning of Regulation U, any Margin Stock.



     (c) Existence; Laws. The Borrower will and will cause each of its Significant
Subsidiaries to, do or cause to be done all things necessary (i) to preserve, renew and keep in
full force and effect its legal existence and all rights, licenses, permits and franchises (except
to the extent otherwise permitted by Sections 7.2(c) or 7.2(d)) and (ii) to comply with all laws
and



51









 




regulations applicable to it, except in each case, where the failure to do so, individually or
in the aggregate, would not reasonably be expected to have a Material Adverse Effect.




     (d) Maintenance of Properties. The Borrower will, and will cause each Significant
Subsidiary to, preserve and maintain all of its Property that is material to the conduct of its
business, provided, however, that nothing in this Section 7.1(d) shall prevent (a)
the Borrower or any of its Significant Subsidiaries from selling, abandoning or otherwise disposing
of any Properties (including the Capital Stock of any Subsidiary of the Borrower that is not a
Significant Subsidiary), the retention of which in the good faith judgment of the Borrower or such
Significant Subsidiary is inadvisable or unnecessary to the business of the Borrower and its
Subsidiaries, taken as a whole, or the failure to maintain would not reasonably be expected to have
a Material Adverse Effect or (b) any other transaction that is expressly permitted by the terms of
any other provision of this Agreement.



     (e) Maintenance of Business Line. The Borrower will maintain its fundamental business
of providing services and products in the energy market.



     (f) Books and Records; Access. The Borrower will, and will cause each Significant
Subsidiary to, keep proper books of record and account in which full, true and correct entries are
made of all dealings and transactions in relation to its business and activities as required by
GAAP. The Borrower will, and will cause each of its Significant Subsidiaries to, at any reasonable
time and from time to time, permit up to six representatives of the Banks designated by the
Majority Banks, or representatives of the Administrative Agent, on not less than five Business
Days’ notice, to examine and make copies of and abstracts from the records and books of account of,
and visit the properties of, the Borrower and each Significant Subsidiary and to discuss the
general business affairs of the Borrower and each of its Significant Subsidiaries with their
respective officers and independent certified public accountants; subject, however, in all cases to
the imposition of such conditions as the Borrower and each of its Significant
Subsidiaries shall deem necessary based on reasonable considerations of safety and security;
provided, however, that neither the Borrower nor any of its Significant
Subsidiaries shall be required to disclose to any Agent, any Bank or any agents or representatives
thereof any information which is the subject of attorney-client privilege or attorney work-product
privilege properly asserted by the applicable Person to prevent the loss of such privilege in
connection with such information or which is prevented from disclosure pursuant to a
confidentiality agreement with third parties. Notwithstanding the foregoing, none of the
conditions precedent to the exercise of the right of access described in the preceding sentence
that relate to notice requirements or limitations on the Persons permitted to exercise such right
shall apply at any time when a Default or an Event of Default shall have occurred and be
continuing.



     (g) Insurance. The Borrower will and will cause each of its Significant Subsidiaries
to, maintain insurance with responsible and reputable insurance companies or associations, or to
the extent that the Borrower or such Significant Subsidiary deems it prudent to do so, through its
own program of self-insurance, in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses, of comparable size and financial strength and with
comparable risks.



52









 





     (h) Corporate Rating. The Borrower will deliver to the Administrative Agent notice of
any change by a Rating Agency in its credit or corporate rating promptly upon the effectiveness of
such change.



     SECTION
7.2. Negative Covenants. The Borrower covenants that, so long as any amount is owing to
the Banks hereunder or under any other Loan Documents to which it is a party or any Letter of
Credit is outstanding under this Agreement, the Borrower will not:



     (a) Financial Ratios. Permit at any time the ratio of Consolidated Indebtedness at
such time to Consolidated Capitalization for the most recently ended fiscal quarter to exceed 65%.



     (b) Certain Liens. And will not permit any of its Restricted Subsidiaries to, pledge,
mortgage, hypothecate or grant a Lien upon, or permit any mortgage, pledge, security interest or
other Lien upon, any Property of the Borrower or any Restricted Subsidiary of the Borrower now or
hereafter owned directly or indirectly by the Borrower; provided, however, that
this restriction shall neither apply to nor prevent the creation or existence of:




     (i) Permitted Liens;




     (ii) (A) any Lien in existence on the date hereof; provided that no such Lien
described in this clause (ii) encumbers any additional Property after the date hereof and
that the principal amount of Indebtedness of the Borrower and its Subsidiaries secured
thereby is not increased;




     (iii) Liens securing bonds issued after the Closing Date pursuant to the Original
Mortgage (to the extent the proceeds thereof are used to replace, refund or refinance first
mortgage bonds outstanding on the date hereof) or the General Mortgage Indenture (or second
or subordinated, as the case may be, Liens in lieu thereof);




     (iv) Liens required to be granted pursuant to “equal and ratable” clauses existing on
the date hereof under Contractual Obligations of the Borrower and its Restricted
Subsidiaries (and extensions and renewals thereof);




     (v) Liens on fixed or capital assets and related inventory and intangible assets
acquired, constructed, improved, altered or repaired by the Borrower or any Restricted
Subsidiary; provided that (i) such Liens secure Indebtedness otherwise permitted by
this Agreement, (ii) such Liens and the Indebtedness secured thereby are incurred prior to
or within 365 days after such acquisition or the later of the completion of such
construction, improvement, alteration or repair or the date of commercial operation of the
assets constructed, improved, altered or repaired, (iii) the Indebtedness secured thereby
does not exceed the cost of acquiring, constructing, improving, altering or repairing such
fixed or capital assets, as the case may be, and (iv) such Lien shall not apply to any other
property or assets of the Borrower or of its Restricted Subsidiaries (other than repairs,
renewals, replacements, additions, accessions, improvements and betterments thereto);




     (vi) Liens on Property and repairs, renewals, replacements, additions, accessions,
improvements and betterments thereto existing at the time such Property is acquired by the
Borrower or any Restricted Subsidiary and not created in contemplation



53









 






of such acquisition
(or on repairs, renewals, replacements, additions, accessions and betterments thereto), and
Liens on the Property of any Person at the time such Person becomes a Restricted Subsidiary
of the Borrower and not created in contemplation of such Person becoming a Restricted
Subsidiary of the Borrower (or on repairs, renewals, replacements, additions, accessions and

betterments thereto);




     (vii) rights reserved to or vested in any Governmental Authority by the terms of any
right, power, franchise, grant, license or permit, or by any Requirements of Law, to
terminate such right, power, franchise, grant, license or permit or to purchase, condemn,
expropriate or recapture or to designate a purchaser of any of the Property of the Borrower
or any of its Restricted Subsidiaries;




     (viii) rights reserved to or vested in (or exercised by) any Governmental Authority to
control, regulate or use any Property of a Person or its activities, including zoning,
planning and environmental laws and ordinances and municipal regulations;




     (ix) Liens on Property of the Borrower or any of its Restricted Subsidiaries securing
non-recourse Indebtedness of the Borrower or any such Restricted Subsidiary;




     (x) Liens on the stock or assets of Securitization Subsidiaries;




     (xi) any extension, renewal or refunding of any Lien permitted by clauses (i) through
(x) above on the same Property previously subject thereto; provided that no
extension, renewal or refunding of any such Lien shall increase the principal amount of any
Indebtedness secured thereby immediately prior to such extension, renewal or refunding,
unless such Indebtedness is permitted under Section 7.2(a);




     (xii) Liens on cash collateral to secure obligations of the Borrower and its Restricted
Subsidiaries in respect of cash management arrangements with any Bank or Affiliate thereof;
and




     (xiii) Liens not otherwise permitted by this Section 7.2(b) securing Indebtedness of
the Borrower and its Restricted Subsidiaries so long as the aggregate outstanding principal
amount of the obligations secured thereby does not at any time exceed at the time of
incurrence of such obligations (including any such incurrence resulting from any extension,
renewal or refunding of such obligations), as to the Borrower and all of its Restricted
Subsidiaries, 10% of Net Tangible Assets.



     (c) Consolidation, Merger or Disposal of Assets. And will not permit any Significant
Subsidiary to, (i) consolidate with, or merge into or amalgamate with or into, any other Person;
(ii) liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution); or (iii)
convey, sell, transfer, lease or otherwise dispose of all or substantially all of its Properties to
any Person; provided, however, that nothing contained in this Section 7.2(c) shall
prohibit (A) a merger involving a Subsidiary of the Borrower (including mergers to reincorporate or
change the domicile of such Subsidiary) if any Wholly-Owned Significant Subsidiary of the Borrower
is the surviving entity thereof; (B) the liquidation, winding up or dissolution of a Significant
Subsidiary of the Borrower if all of the Properties of such Significant Subsidiary are conveyed,
transferred or distributed to the Borrower or a Person that after giving effect to such transaction
is a Wholly-



54









 




Owned Significant Subsidiary of the Borrower; (C) the conveyance, sale, transfer or
other disposal of all or substantially all (or any lesser portion) of the Properties of any
Significant Subsidiary of the Borrower to the Borrower or a Person that after giving effect to such
transaction is a Wholly-Owned Significant Subsidiary of the Borrower; or (D) the transfer of assets
in connection with the issuance of Securitization Securities; provided that, in each case,
immediately before and after giving effect to any such merger, dissolution or liquidation, or
conveyance, sale, transfer, lease or other disposition, no Default or Event of Default shall have
occurred and be continuing.




     (d) Sale of Significant Subsidiary Stock. And will not permit the sale, assignment,
transfer or other disposal of any of the Capital Stock of any Significant Subsidiary.
Notwithstanding the foregoing provisions of Section 7.2(c) or this Section 7.2(d), (x) the Borrower
or any Significant Subsidiary may sell, assign, transfer or otherwise dispose of (i) any of the
Capital Stock of any Significant Subsidiary to the Borrower or to a Wholly-Owned Subsidiary of the
Borrower that constitutes a Significant Subsidiary after giving effect to such transaction and (ii)
any of the Capital Stock of any Subsidiary that is not a Significant Subsidiary and (y) any
Significant Subsidiary shall have the right to issue, sell, assign, transfer or otherwise dispose
of for value its preference or preferred stock in one or more bona fide transactions to any Person;
provided that immediately before and after giving effect to any such Disposition described
in the foregoing clauses (x) and (y), no Event of Default or Default shall have occurred and be
continuing.



     (e) Agreements Restricting Dividends. And will not permit any Significant Subsidiary
to enter into, incur or permit to exist any agreement or other consensual arrangement that
explicitly prohibits or restricts the payment by any Significant Subsidiary of dividends or other
distributions with respect to any shares of its Capital Stock; provided that the foregoing
shall not
prohibit financial incurrence, maintenance and similar covenants that indirectly have the
practical effect of prohibiting or restricting the ability of a Significant Subsidiary to make such
payments or provisions that require that a certain amount of capital be maintained, or prohibit the
return of capital to shareholders above certain dollar limits; provided further,
that the foregoing shall not apply to (i) restrictions and conditions imposed by law or by this
Agreement, (ii) restrictions and conditions existing on the date hereof, any amendment or
modification thereof (other than an amendment or modification expanding the scope of any such
restriction or condition and any restrictions or conditions) that (x) replace restrictions or
conditions existing on the date hereof and (y) are substantially similar to such existing
restriction or condition, (iii) restrictions (including any extension of such restrictions that
does not expand the scope of any such restrictions) existing at the time at which any such
Subsidiary first becomes a Significant Subsidiary, so long as such restriction was in existence
prior to such time in accordance with the other provisions of this Agreement and was not agreed to
or incurred in contemplation of such change of status, (iv) any restrictions with respect to a
Significant Subsidiary imposed pursuant to an agreement that has been entered into in connection
with a disposition of all or substantially all of the Capital Stock or assets of such Subsidiary,
(v) any restrictions in respect of preferred or preference stock permitted to be incurred by
Significant Subsidiaries under Section 7.2(d) and (vi) restrictions in respect of Project
Financings permitted hereunder.



55









 





     (f) Certain Investments, Loans, Advances, Guarantees and Acquisitions. And will not
permit any of its Significant Subsidiaries to (i) purchase or acquire (including pursuant to any
merger) any Capital Stock, evidence of indebtedness or other securities of or other interest in
(including any option, warrant or other right to acquire any of the foregoing), make any loans or
advances to, Guarantee any obligations of, or make any investment or other interest in or capital
contribution to any Unrestricted Subsidiary or purchase or otherwise acquire (in one transaction or
a series of transactions) any assets of any Unrestricted Subsidiary constituting a business unit,
(any of the foregoing, an “Investment”) at any time if the aggregate amount of net tangible
assets of all Unrestricted Subsidiaries at such time exceeds, or would exceed as a result of any
such Investment, 10% of the Net Tangible Assets and (ii) make Investments in Project Finance
Subsidiaries at any time if the aggregate amount of Investments at such time exceeds, or would
exceed as a result of any such Investments, $400,000,000.



ARTICLE VIII




EVENTS OF DEFAULT




     SECTION
8.1. Events of Default. The occurrence of any of the following events shall constitute an
“Event of Default”:



     (a) Non-Payment of Principal, Interest and Commitment Fee. The Borrower fails to pay,
in the manner provided in this Agreement, (i) any principal or Reimbursement Obligations payable by
it hereunder when due or (ii) any interest payment, any Commitment Fee, any Utilization Fee or any
Letter of Credit fee payable by it hereunder within five (5) Business Days after its due date; or



     (b) Non-Payment of Other Amounts. The Borrower fails to pay, in the manner provided
in this Agreement, any other amount (other than the amounts set forth in Section 8.1(a) above)
payable by it hereunder within ten (10) Business Days after notice of such payment is received by
the Borrower from the Administrative Agent; or



     (c) Breach of Representation or Warranty. Any representation or warranty by the
Borrower in Section 6.1, in any other Loan Document or in any certificate, document or instrument
delivered by the Borrower under this Agreement shall have been incorrect in any material respect
when made or when deemed hereunder to have been made; or



     (d) Breach of Certain Covenants. Borrower fails to perform or comply with any one or
more of its obligations under Section 7.1(a)(iv)(B)(x) or 7.2; or



     (e) Breach of Other Obligations. Borrower does not perform or comply with any one or
more of its other obligations under this Agreement (other than those set forth in Section 8.1(a),
(b) or (d) above) or under any other Loan Document and such failure to perform or comply shall not
have been remedied within 30 days after the earlier of notice thereof to it by the Administrative
Agent or the Majority Banks or discovery thereof by a Responsible Officer of the Borrower; or



56









 





     (f) Other Indebtedness. (i) The Borrower or any Significant Subsidiary fails to pay
when due (either at stated maturity or by acceleration or otherwise but subject to applicable grace
periods) any principal or interest in respect of any Indebtedness for Borrowed Money, Secured
Indebtedness, or Junior Subordinated Debt (other than Indebtedness of the Borrower under this
Agreement) if the aggregate principal amount of all such Indebtedness for which such failure to pay
shall have occurred and be continuing exceeds $50,000,000 or (ii) any default, event or condition
shall have occurred and be continuing with respect to any Indebtedness for Borrowed Money, Secured
Indebtedness, or Junior Subordinated Debt of the Borrower or any Significant Subsidiary (other than
Indebtedness of the Borrower under this Agreement), the effect of which default, event or condition
is to cause, or to permit the holder thereof to cause, (A) such Indebtedness to become due prior to
its stated maturity (other than in respect of mandatory prepayments required thereby) or (B) in the
case of any Guarantee by the Borrower or any Significant Subsidiary of Indebtedness for Borrowed
Money of any Person or Junior Subordinated Debt of the Borrower or any of its Significant
Subsidiaries the primary obligation (as such term is defined in the definition of “Guarantee” in
Section 1.1) to which such Guarantee relates to become due prior to its stated maturity, if the
aggregate amount of all such Indebtedness or primary obligations (as the case may be) that is or
could be caused to be due prior to its stated maturity exceeds $50,000,000; or



     (g) Involuntary Bankruptcy, Etc. (i) There shall be commenced against the Borrower or
any Significant Subsidiary any case, proceeding or other action (A) seeking a decree or order for
relief in respect of the Borrower or any Significant Subsidiary under any applicable domestic or
foreign bankruptcy, insolvency, reorganization or other similar law, (B) seeking a decree or order
adjudging the Borrower or any Significant Subsidiary a bankrupt or insolvent, (C) except as
permitted by Section 7.2(c)(ii), seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other similar relief of or in respect of the Borrower or
any Significant Subsidiary or their respective debts under any applicable domestic or foreign law
or (D) seeking the appointment of a custodian, receiver, conservator, liquidator, assignee,
trustee, sequestrator or other similar official of the Borrower or any Significant Subsidiary or of
any substantial part of their respective Properties, or the liquidation of their respective
affairs, and such petition is not dismissed within 90 days or (ii) a decree, order or other
judgment is entered in respect of any of the remedies, reliefs or other matters for which any
petition referred to in (i) above is presented or (iii) there shall be commenced against the
Borrower or any Significant Subsidiary any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar process against all or any substantial part
of its assets that results in the entry of an order for any such relief that shall not have been
vacated, discharged or stayed or bonded pending appeal within 90 days from the entry thereof; or



     (h)  Voluntary Bankruptcy, Etc. (i) The commencement by the Borrower or any Significant
Subsidiary of a voluntary case, proceeding or other action under any applicable domestic or foreign
bankruptcy, insolvency, reorganization or other similar law (A) seeking to have an order of relief
entered with respect to it, (B) seeking to be adjudicated a bankrupt or insolvent, (C) seeking
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other
similar relief with respect to it or its debts under any applicable domestic or foreign law or (D)
seeking the appointment of or the taking possession by a custodian, receiver, conservator,
liquidator, assignee, trustee, sequestrator or similar official of the Borrower or any Significant
Subsidiary of any substantial part of its Properties; or (ii) the




57










 




making by the Borrower or any Significant Subsidiary of a general assignment for the benefit
of creditors; or (iii) the Borrower or any Significant Subsidiary shall take any action in
furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts
described in clause (i) or (ii) above or in Section 8.1(g); or (iv) the admission by the Borrower
or any Significant Subsidiary in writing of its inability to pay its debts generally as they become
due or the failure by the Borrower or any Significant Subsidiary generally to pay its debts as such
debts become due; or




     (i) Enforcement Proceedings. A final judgment or decree for the payment of money (not
paid or fully covered by insurance as to which the relevant insurance company has acknowledged
coverage) which, together with all other such judgments or decrees against the Borrower or any
Significant Subsidiary then outstanding and unsatisfied, exceeds $50,000,000 in aggregate amount
not covered by insurance shall be rendered against the Borrower or any Significant Subsidiary and
the same shall remain undischarged for a period of 60 days, during which the execution thereon
shall not effectively be stayed, released, bonded or vacated; or



     (j) ERISA Events. The existence of an event or events, individually or, in the
aggregate, that could reasonably be expected to have a Material Adverse Effect arising out of or in
connection with (A) any “prohibited transaction” (as defined in Section 406 of ERISA or Section
4975 of the Code) involving any Plan, (B) the occurrence of any “accumulated funding deficiency”
(within the meaning of Section 412 of the Code or Section 302 of ERISA) by a Plan, whether or not
waived, or any Lien in favor of the PBGC or a Plan on the assets of the Borrower or any Commonly
Controlled Entity, (C) the occurrence of a Reportable Event with respect to, or the commencement of
proceedings under Section 4042 of ERISA to have a trustee appointed, or the appointment of a
trustee under Section 4042 of ERISA, to administer or to terminate any Single Employer Plan, which
Reportable Event, commencement of proceedings or appointment of a trustee which would reasonably be
expected to result in the termination of such Plan for purposes of Title IV of ERISA, (D) the
termination of any Single Employer Plan for purposes of Title IV of ERISA, (E) withdrawal from, or
the Insolvency or Reorganization of, a Multiemployer Plan or (F) the occurrence of any other event
or condition with respect to a Plan; or



     (k) Change in Control. A Change in Control shall have occurred.



     SECTION 8.2. Cancellation/Acceleration. If at any time and for any reason (whether
within or beyond the control of any party to this Agreement):



     (a) either of the Events of Default specified in Section 8.1(g) or 8.1(h) occurs with respect
to the Borrower, then automatically:




     (i) the Commitments shall immediately be cancelled; and




     (ii) all Loans made hereunder, all amounts of L/C Obligations (whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented the documents
required for draws thereunder), all unpaid accrued interest or fees and any other sum
payable under this Agreement or any other Loan Document shall become immediately due and
payable; or



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     (b) any other Event of Default specified in Section 8.1 occurs and, while such Event of
Default is continuing, the Administrative Agent, having been so instructed by the Majority Banks,
by notice to the Borrower shall so declare that:




     (i) the Commitments shall immediately be cancelled; and/or




     (ii) either (A) all Loans made hereunder, all amounts of L/C Obligations (whether or
not the beneficiaries of the then outstanding Letters of Credit shall have presented the
documents required for draws thereunder), all unpaid accrued interest or fees and any other
sum payable under this Agreement or any other Loan Document shall become immediately due and
payable or (B) all Loans made hereunder, all amounts of L/C Obligations (whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented the documents
required for draws thereunder), all unpaid accrued interest or fees and any other sum
payable under this Agreement or any other Loan Document shall become due and payable at any
time thereafter immediately on demand by the Administrative Agent (acting on the
instructions of the Majority Banks).



     With respect to all Letters of Credit with respect to which presentment for honor shall not
have occurred at the time of an acceleration pursuant to the preceding paragraph or on the
Termination Date, the Borrower shall at such time deposit in a cash collateral account opened by
the Administrative Agent cash or cash equivalents in an amount equal to the aggregate then undrawn
and unexpired face amount of such Letters of Credit. The Borrower hereby grants to the
Administrative Agent, for the benefit of the Issuing Bank and the L/C Participants, a security
interest in such cash collateral to secure all obligations of the Borrower under this Agreement and
the other Loan Documents. Interest shall accrue on such account for the benefit of the Borrower at
a rate equal to the Federal Funds Effective Rate. Amounts held in such cash collateral account
shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall have expired or been
fully drawn upon, if any, shall be applied to repay other obligations of the Borrower hereunder and
under the Notes. After all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of the Borrower
hereunder and under the Notes shall have been paid in full, the balance, if any, in such cash
collateral account shall be returned to the Borrower. The Borrower shall execute and deliver to
the Administrative Agent, for the account of each Issuing Bank and the L/C Participants, such
further documents and instruments as the Administrative Agent may reasonably request to evidence
the creation and perfection of the within security interest in such cash collateral account.


Except as expressly provided above in this Section 8.2, presentment, demand, protest, notice of
intent to accelerate, notice of acceleration and all other notices of any kind whatsoever are
hereby expressly waived by the Borrower.




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ARTICLE IX




THE ADMINISTRATIVE AGENT




     SECTION 9.1. Appointment. Each Bank hereby irrevocably designates and appoints
JPMorgan Chase Bank, N.A. as the Administrative Agent of such Bank under this Agreement and the
other Loan Documents, and each such Bank irrevocably authorizes JPMorgan Chase Bank, N.A., as the
Administrative Agent for such Bank, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary elsewhere in this Agreement, (a) the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Bank, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent and (b) the other Agents and the Lead Arrangers
shall not have any duties or responsibilities hereunder, or any fiduciary relationship with any
Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or any other Loan Document or otherwise exist against the other
Agents or the Lead Arrangers.



     SECTION 9.2. Delegation of Duties. The Administrative Agent may execute any of its
duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.



     SECTION 9.3. Exculpatory Provisions. Neither any Agent nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (a) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in connection with this
Agreement or any other Loan Document (except for its or such Person’s own gross negligence or
willful misconduct) or (b) responsible in any manner to any of the Banks for any recitals,
statements, representations or warranties made by the Borrower or any officer thereof contained in
this Agreement or any other Loan Document or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative Agent or any other Agent
under or in connection with, this Agreement or any other Loan Document or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or any Note or any
other Loan Document or for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Agents shall not be under any obligation to any Bank to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or records of the
Borrower.



     SECTION 9.4. Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution,
notice, consent, certificate, affidavit, letter, facsimile, telex or teletype message, statement,
order or other document or conversation believed by it to be genuine and correct and to have been
signed,



60









 







sent or made by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower), independent accountants and other experts
selected by the Administrative Agent. The Administrative Agent may deem and treat the payee of any
Note or any loan account in the Register as the owner thereof for all purposes unless a written
notice of assignment, negotiation or transfer thereof shall have been filed with the Administrative
Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action
under this Agreement or any other Loan Document unless it shall first receive such advice or
concurrence of the Majority Banks (or, if so specified by this Agreement, all Banks) as it deems
appropriate or it shall first be indemnified to its satisfaction by the Banks against any and all
liability and expense that may be incurred by it by reason of taking or continuing to take any such
action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement and the other Loan Documents in accordance with a request of the
Majority Banks (or, if so specified by this Agreement, all Banks), and such request and any action
taken or failure to act pursuant thereto shall be binding upon all the Banks and all future holders
of the amounts owing hereunder.



     SECTION 9.5. Notice of Default. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Bank or the Borrower referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a “notice of default”.
In the event that the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Banks. The Administrative Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the Majority Banks;
provided that unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Banks.



     SECTION 9.6. Non-Reliance on Administrative Agent and Other Banks. Each Bank
expressly acknowledges that neither the Agents nor any of their respective officers, directors,
employees, agents, attorneys-in-fact or Affiliates have made any representations or warranties to
it and that no act by any Agent hereinafter taken, including any review of the affairs of the
Borrower, shall be deemed to constitute any representation or warranty by any Agent to any Bank.
Each Bank represents to the Agents that it has, independently and without reliance upon any Agent
or any other Bank, and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to make its Loans
hereunder and enter into this Agreement. Each Bank also represents that it will, independently and
without reliance upon any Agent or any other Bank, and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and
decisions in taking or not taking action under this Agreement and the other Loan Documents, and to
make such investigation as it deems necessary to inform itself as to the business, operations,
property, financial and other condition and creditworthiness of the Borrower. Except for notices,
reports and other documents expressly required to be furnished to the Banks by the Administrative
Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any
Bank with any credit or other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness



61









 







of the Borrower that may come into the possession of the Administrative Agent or any of its
officers, directors, employees, attorneys-in-fact or Affiliates.



     SECTION 9.7. Indemnification. The Banks agree to indemnify the Agents and the Lead
Arrangers in their respective capacities as such (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably according to their respective
applicable Revolving Percentages in effect on the date on which indemnification is sought under
this Section 9.7, from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that
may at any time (including, without limitation, at any time following the payment of all amounts
owing hereunder and the termination of the Commitments) be imposed on, incurred by or asserted
against the Agents or the Lead Arrangers, as the case may be, in any way relating to or arising out
of this Agreement, any of the other Loan Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted
by the Agents or the Lead Arrangers, as the case may be, under or in connection with any of the
foregoing; provided that no Bank shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Agents’ or the Lead Arrangers’, as the case may be, gross
negligence or willful misconduct. The agreements in this Section 9.7 shall survive the payment of
all amounts payable hereunder.



     SECTION 9.8. Agent in Its Individual Capacity. Each Agent and its Affiliates may make
loans to, accept deposits from and generally engage in any kind of business with the Borrower as
though such Agent were not an Agent hereunder and under the other Loan Documents. With respect to
its Loans made or renewed by it, any Letter of Credit issued or participated in by it and its
Commitment hereunder, each Agent shall have the same rights and powers under this Agreement and the
other Loan Documents as any Bank and may exercise the same as though it were not an Agent, and the
terms “Bank” and “Banks” shall include the each Agent in its individual capacity.



     SECTION 9.9. Successor Administrative Agent. The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Banks and the Borrower. If the Administrative
Agent shall resign as Administrative Agent under this Agreement and the other Loan Documents, then
the Majority Banks shall appoint from among the Banks a successor agent for the Banks, which
successor agent shall be approved by the Borrower, whereupon such successor agent shall succeed to
the rights, powers and duties of the Administrative Agent, and the term “Administrative Agent”
shall mean such successor agent effective upon such appointment and approval, and the former
Administrative Agent’s rights, powers and duties as Administrative Agent shall be terminated,
without any other or further act or deed on the part of such former Agent or any of the parties to
this Agreement or any holders of any amounts payable hereunder; provided that if an Event
of Default has occurred and is continuing, no consent of the Borrower shall be required. If a
successor Administrative Agent shall not have been so appointed within said 30-day period, the
Administrative Agent may then appoint a successor Administrative Agent who shall be a financial
institution engaged or licensed to conduct banking business under the laws of the United States
with an office in New York City and that has total assets in excess of $500,000,000 and who shall
serve as Administrative Agent until such time, if any, as an Administrative Agent shall have been
appointed as provided above. After any retiring



62









 







Administrative Agent’s resignation or removal as Administrative Agent, the provisions of this
Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it
was Administrative Agent under this Agreement and the other Loan Documents.



     Notwithstanding anything to the contrary contained herein, no Bank identified as an “Agent”,
“Arranger” or “Global Coordinator” other than the Administrative Agent, shall have the right,
power, obligation, liability, responsibility or duty under this Agreement or any Loan Document
other than those applicable to all Banks as such. Without limiting the foregoing, none of the
Banks so identified shall have or be deemed to have any fiduciary relationship with any Bank. Each
Bank acknowledges that it has not relied, and will not rely, on any of the Banks so identified in
deciding to enter into this Agreement or not taking action hereunder.



ARTICLE X




MISCELLANEOUS




     SECTION 10.1. Amendments and Waivers. Neither this Agreement, any Note, any other
Loan Document, nor any terms hereof or thereof may be amended, supplemented or modified except
pursuant to an instrument or instruments in writing executed in accordance with the provisions of
this Section 10.1. The Majority Banks may, or, with the written consent of the Majority Banks, the
Administrative Agent may, from time to time, (a) enter into with the Borrower written amendments,
supplements or modifications hereto and to any Notes and the other Loan Documents for the purpose
of adding any provisions to this Agreement or any Notes or the other Loan Documents or changing in
any manner the rights of the Banks or of the Borrower hereunder or thereunder or (b) waive, on such
terms and conditions as the Majority Banks or the Administrative Agent, as the case may be, may
specify in such instrument, any of the requirements of this Agreement or any Notes or the other
Loan Documents or any Default or Event of Default and its consequences; provided,
however, that no such waiver and no such amendment, supplement or modification shall:




     (i) reduce the amount or extend the scheduled date of maturity of any Note or Loan, or
reduce the stated rate of any interest or fee (including the prepayment premium provided for
in Section 4.6) payable hereunder or extend the scheduled date of any payment thereof, or
increase the amount or extend the expiration date of any Bank’s Commitments, in each case
without the consent of each Bank directly affected thereby;




     (ii) amend, modify or waive any provision of this Section or of Section 4.2 in a manner
that would alter the pro rata sharing of payments required thereby, or reduce the percentage
specified in the definition of Majority Banks, or consent to the assignment or transfer by
the Borrower of any of its respective rights and obligations under this Agreement and the
other Loan Documents, in each case without the written consent of all the Banks;




     (iii) amend, modify or waive any provision of Article IX without the written consent of
the then Administrative Agent; or



63









 






     (iv) amend, modify or waive any provision of Section 2.5 in a manner that adversely
affects any Issuing Bank without the written consent of the then Issuing Bank or Issuing
Banks; or




     (v) amend, modify or waive any provision of Section 2.4 in a manner that adversely
affects any Swingline Lender without the written consent of the then Swingline Lender or
Swingline Lenders.



          Any such waiver and any such amendment, supplement or modification shall apply equally to each
of the Banks and shall be binding upon the Borrower, the Banks, the Issuing Bank or Issuing Banks,
the Administrative Agent and all future holders of the amounts payable hereunder. In the case of
any waiver (to the extent specified therein), the Borrower, the Banks, the Issuing Bank or Issuing
Banks, and the Administrative Agent shall be restored to their former position and rights hereunder
and under any outstanding Notes and any other Loan Documents, and any Default or Event of Default
waived shall be deemed to be cured and not continuing, but no such waiver shall extend to any
subsequent or other Default or Event of Default, or impair any right consequent thereon.




     SECTION 10.2. Notices. (a) Unless otherwise expressly provided herein, all notices,
requests and demands to or upon the respective parties hereto to be effective shall be in writing
(including by facsimile followed by any original sent by mail or delivery), and, shall be deemed to
have been duly given or made when delivered by hand, or three days after being deposited in the
mail, postage prepaid, or, in the case of telecopy notice, when received, addressed as follows in
the case of the Borrower and the Administrative Agent, and as set forth in Schedule 1.1(A)
in the case of the other parties hereto, or to such other address as may be hereafter notified by
the respective parties hereto and any future holders of the amounts payable hereunder:



	 	 	 	 	 
	 

	 	Borrower:
	 	1111 Louisiana
	 

	 	 	 	Houston, Texas 77002
	 

	 	Attention:
	 	Linda Geiger
	 

	 	 	 	Assistant Treasurer
	 

	 	Telecopy:
	 	(713) 207-3301
	 
	 	 	 	 
	 

	 	With a copy to:
	 	Marc Kilbride
	 

	 	 	 	Treasurer
	 

	 	Telecopy:
	 	(713) 207-3301
	 
	 	 	 	 
	 

	 	Administrative
	 	JPMorgan Chase Bank, N.A. Loan and Agency Services
	 

	 	Agent:
	 	Group
	 

	 	 	 	1111 Fannin Street
	 

	 	 	 	Houston, Texas 77002
	 

	 	Attention:
	 	Regina Harmon
	 

	 	Telecopy:
	 	(713) 427-6307
	 
	 	 	 	 
	 

	 	With a copy to:
	 	JP Morgan Chase Bank, N.A.
	 

	 	 	 	600 Travis, 20th Floor
	 

	 	 	 	Houston, Texas 77002






64









 






	 	 	 	 	 
	 

	 	Attention:
	 	Robert Traband
	 

	 	Telecopy:
	 	(713) 216-8870
	 
	 	 	 	 
	 

	 	Swingline
	 	JPMorgan Chase Bank, N.A. Loan and Agency Services
	 

	 	Lender:
	 	Group
	 

	 	 	 	1111 Fannin Street
	 

	 	 	 	Houston, Texas 77002
	 

	 	Attention:
	 	Regina Harmon
	 

	 	Telecopy:
	 	(713) 427-6307
	 
	 	 	 	 
	 

	 	With a copy to:
	 	JP Morgan Chase Bank, N.A.
	 

	 	 	 	600 Travis, 20th Floor
	 

	 	 	 	Houston, Texas 77002
	 

	 	Attention:
	 	Robert Traband
	 

	 	Telecopy:
	 	(713) 216-8870





provided that any notice, request or demand to or upon the Administrative Agent or the
Banks shall not be effective until received.




     (b) The Borrower hereby acknowledges that (i) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to
the Borrower or its securities) (each, a “Public Lender”) and (ii) the Administrative Agent
will make available to the Lenders certain notices, requests, financial statements, financial and
other reports, certificates and other information materials, but excluding any such communication
that initiates or responds to the legal process (all such non-excluded information being referred
to herein collectively as the “Communications”) on IntraLinks or another relevant website
(whether a commercial, third-party website or whether sponsored by the Administrative Agent) (the
“Platform”). The Borrower hereby agrees that all Communications that are to be made
available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum,
shall mean that the word “PUBLIC” shall appear prominently on the first page thereof, (ii) by
marking Communications “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative
Agent, the Issuing Banks and the Lenders to treat such Communications as not containing any
material non-public information with respect to the Borrower or its securities for purposes of
United States Federal and state securities laws, it being understood that certain of such
Communications may be subject to the confidentiality requirements hereof, (iii) all Communications
marked “PUBLIC” are permitted to be made available through a portion of the Platform designated
“Public Investor,” and (iv) the Administrative Agent shall be entitled to treat any Communications
that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not
designated “Public Investor.” Notwithstanding the foregoing, (A) the Borrower shall be under no
obligation to mark any Communications “PUBLIC,” and each Public Lender hereby waives its right to
receive any Communications that are not marked “PUBLIC”; and (B) the Administrative Agent shall
treat Communications that are deemed to have been delivered based on notice pursuant to the last
sentence of Section 7.1(a) as “PUBLIC.”



65









 





     SECTION 10.3. No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Bank, any right, remedy, power or
privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.



     SECTION 10.4. Survival of Representations and Warranties. All representations and
warranties made hereunder and in any document, certificate or statement delivered pursuant hereto
or in connection herewith shall survive the execution and delivery of this Agreement.



     SECTION 10.5. Payment of Expenses and Taxes; Indemnity. The Borrower agrees (a) to
pay all reasonable out-of-pocket expenses of the Global Coordinators associated with the
syndication of the Facility, (b) to pay or reimburse the Administrative Agent and its Affiliates
for all its reasonable out-of-pocket costs and expenses incurred in connection with the
development, preparation, negotiation and execution and delivery of, and any amendment, supplement
or modification to, this Agreement and any Notes and the other Loan Documents and any other
documents prepared in connection herewith or therewith, and the consummation and administration of
the transactions contemplated hereby and thereby, including, without limitation, the reasonable
fees and disbursements of Simpson Thacher & Bartlett LLP, special counsel to the Administrative
Agent (but excluding the fees or expenses of any other counsel), (c) to pay or reimburse the
Administrative Agent for all its costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, any Notes, the other Loan Documents and any such
other documents, including, without limitation, the reasonable fees and disbursements of the
special counsel to the Administrative Agent, (d) to pay or reimburse each Bank for all its costs
and expenses incurred in connection with the enforcement, or at any time after the occurrence and
during the continuance of a Default or an Event of Default the preservation, of any rights under
this Agreement, any Notes, the other Loan Documents and any such other documents, including,
without limitation, the reasonable fees and disbursements of counsel to such Bank, (e) without
duplication of any other provision contained in this Agreement or any Notes, to pay, indemnify, and
hold each Bank and the Administrative Agent harmless from, any and all recording and filing fees,
if any, and any and all liabilities (for which each Bank has not been otherwise reimbursed under
this Agreement) with respect to, or resulting from any delay in paying, stamp, excise and other
taxes, if any, that may be payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions contemplated by, or any
amendment, supplement or modification of, or any waiver or consent under or in respect of, this
Agreement, any Notes, the other Loan Documents and any such other documents, and (f) without
duplication of any other provision contained in this Agreement or any Notes, to pay, indemnify, and
hold each Global Coordinator, each Lead Arranger, each Bank, each Swingline Lender and each Agent
together with their respective directors, officers, employees, agents, trustees, advisors and
affiliates (collectively, “Indemnified Persons”) harmless from and against, any and all
other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (including without limitation, all fees
and expenses of counsel to any indemnified person) with respect to the execution, delivery,
enforcement, performance and administration of this Agreement, any Notes or the other Loan



66









 







Documents, the transactions contemplated by this Agreement, any Notes or the other Loan
Documents, or the use, or proposed use, of proceeds of the Loans (all the foregoing in this clause
(f), collectively, the “Indemnified Liabilities”); provided that the Borrower shall
have no obligation hereunder to an Indemnified Person with respect to Indemnified Liabilities
arising from the gross negligence or willful misconduct of such
Indemnified Person, AND PROVIDED
FURTHER THAT IT IS THE INTENTION OF THE BORROWER TO INDEMNIFY THE INDEMNIFIED PERSONS AGAINST THE
CONSEQUENCES OF THEIR OWN NEGLIGENCE. The agreements in this Section 10.5 shall survive repayment
of the Loans and all other amounts payable hereunder.



     SECTION 10.6. Effectiveness, Successors and Assigns, Participations; Assignments. (a)
This Agreement shall become effective on the date hereof and thereafter shall be binding upon and
inure to the benefit of the Borrower, the Banks, each Issuing Bank, the Administrative Agent, all
future holders of the Loans and their respective successors and assigns, except that the Borrower
may not assign or transfer any of its rights or obligations under this Agreement without the prior
written consent of each Bank.



     (b) Any Bank may, in the ordinary course of its business and in accordance with applicable
law, at any time sell to one or more banks or other financial institutions or Bank Affiliates (a
“Participant”) participating interests in any Loan owing to such Bank, any Note held by
such Bank, any Commitment of such Bank or any other interest of such Bank hereunder and under the
other Loan Documents. In the event of any such sale by a Bank of a participating interest to a
Participant, such Bank’s obligations under this Agreement to the other parties to this Agreement
shall remain unchanged, such Bank shall remain solely responsible for the performance thereof, such
Bank shall remain the holder of any such Loan and Commitment or other interest for all purposes
under this Agreement and the other Loan Documents, the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Bank in connection with such Bank’s rights and
obligations under this Agreement and the other Loan Documents and except with respect to the
matters set forth in Section 10.1, the amendment of which requires the consent of all of the Banks,
the participation agreement between the selling Bank and the Participant may not restrict such
Bank’s voting rights hereunder. The Borrower agrees that each Participant, to the extent provided
in its participation, shall be entitled to the benefits of Sections 3.4, 3.7, 4.1 and 4.3 with
respect to its participation in the Commitments and the Loans outstanding from time to time;
provided that (i) no Participant shall be entitled to receive any greater amount pursuant
to such Sections than the selling Bank would have been entitled to receive in respect of the amount
of the participation sold by such selling Bank to such Participant had no such sale occurred and
(ii) each such sale of participating interests shall be to a “qualified purchaser”, as such term is
defined under the Investment Company Act of 1940. Except as expressly provided in this Section
10.6(b), no Participant shall be a third-party beneficiary of or have any rights under this
Agreement or under any of the other Loan Documents.



     (c) Except as set forth below, the Banks shall be permitted to assign all or a portion of
their Loans and Commitments to one or more financial institutions (“Purchasing Banks”) with
the consent, not to be unreasonably withheld, of (a) the Borrower, unless (i) the Purchasing Bank
is a Bank or a Bank Affiliate or (ii) an Event of Default has occurred and is continuing, (b) the
Administrative Agent, unless the assignment is from a Bank to its Bank Affiliate, and (c) each



67









 







Issuing Bank, unless the assignment is from a Bank to its Bank Affiliate pursuant to an
Assignment and Acceptance, substantially in the form of Exhibit C (an “Assignment and
Acceptance”), executed by such Purchasing Bank and such transferor Bank (and by the Borrower,
the Administrative Agent and each Issuing Bank, as applicable) and delivered to the Administrative
Agent for its acceptance and recording in the Register; provided that (i) such Purchasing
Bank is a “qualified purchaser” as defined under the Investment Company Act of 1940, (ii) each such
sale shall be of a uniform, and not a varying, percentage of all rights and obligations under and
in respect of the Commitment of such Bank, (iii) each such sale shall be in an aggregate amount of
not less than $5,000,000 (or such lesser amount representing the entire Commitment of such
transferor Bank) if such sale is not to an existing Bank and (iv) after giving effect to such sale,
the transferor Bank shall (to the extent that it continues to have any Commitment hereunder) have a
Commitment of not less than $5,000,000, provided that such amounts shall be aggregated in
respect of each Bank and its Bank Affiliates, if any. Upon such execution, delivery, acceptance
and recording, from and after the effective date determined pursuant to such Assignment and
Acceptance (the “Transfer Effective Date”), (i) the Purchasing Bank thereunder shall be a
party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and
obligations of a Bank hereunder with the Commitments as set forth therein and (ii) the transferor
Bank thereunder shall, to the extent provided in such Assignment and Acceptance, be released from
its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all
or the remaining portion of a transferor Bank’s rights and obligations under this Agreement, such
transferor Bank shall cease to be a party hereto). Such Assignment and Acceptance shall be deemed
to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of
such Purchasing Bank and the resulting adjustment of Revolving Percentages arising from the
purchase by such Purchasing Bank of all or a portion of the rights and obligations of such
transferor Bank under this Agreement. On or prior to the Transfer Effective Date determined
pursuant to such Assignment and Acceptance, (i) appropriate entries shall be made in the accounts
of the transferor Bank and the Register evidencing such assignment and releasing the Borrower from
any and all obligations to the transferor Bank in respect of the assigned Loan or Loans and (ii)
appropriate entries evidencing the assigned Loan or Loans shall be made in the accounts of the
Purchasing Bank and the Register as required by Section 3.1 hereof. In the event that any Notes
have been issued in respect of the assigned Loan or Loans, such Notes shall be marked “cancelled”
and surrendered by the transferor Bank to the Administrative Agent for return to the Borrower.



     (d) The Administrative Agent shall maintain at its address referred to in Section 10.2(a) a
copy of each Assignment and Acceptance delivered to it and a register (the “Register”) for
the recordation of the names and addresses of the Banks and the Commitments of, and principal
amount of the Loans owing to, each Bank from time to time. To the extent permitted by applicable
law, the entries in the Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Banks may (and, in the case of any Loan or other
obligations hereunder not evidenced by a Note, shall) treat, each Person whose name is recorded in
the Register as the owner of a Loan or other obligation hereunder as the owner thereof for all
purposes of this Agreement and the other Loan Documents, notwithstanding any notice to the
contrary. Any assignment of any Loan or other obligation hereunder not evidenced by a Note shall be
effective only upon appropriate entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower or any Bank at any reasonable time and
from time to time upon reasonable prior notice.



68









 





     (e) Upon its receipt of an Assignment and Acceptance executed by a transferor Bank and
Purchasing Bank (and, in the case of a Purchasing Bank that is not then a Bank Affiliate, by the
Borrower and the Administrative Agent) together with payment to the Administrative Agent of a
registration and processing fee of $3,500, the Administrative Agent shall promptly accept such
Assignment and Acceptance on the Transfer Effective Date determined pursuant thereto, record the
information contained therein in the Register and give notice of such acceptance and recordation to
the Banks and the Borrower.



     (f) Each of the Banks and the Administrative Agent agrees to exercise its best efforts to
keep, and to cause any third party recipient of the information described in this Section 10.6(f)
to keep, any information delivered or made available by the Borrower to it (including any
information obtained pursuant to Section 7.1), confidential from anyone other than Persons employed
or retained by such party who are or are expected to become engaged in evaluating, approving,
structuring or administering the transactions contemplated hereunder; provided that nothing
shall prevent any Bank or the Administrative Agent from disclosing such information (i) to any
other Bank or any Affiliate of any Bank, (ii) pursuant to subpoena or upon the order of any court
or administrative agency, (iii) upon the request or demand of any Governmental Authority having
jurisdiction over such Bank, (iv) if such information has been publicly disclosed, (v) to the
extent reasonably required in connection with any litigation to which either the Administrative
Agent, any Bank, the Borrower or their respective Affiliates may be a party, (vi) to the extent
reasonably required in connection with the exercise of any remedy hereunder, (vii) to the
Administrative Agent’s or such Bank’s, as the case may be, legal counsel, independent auditors and
other professional advisors, or (viii) to any actual or proposed Participant, Purchasing Bank or
pledgee (each, a “Transferee”) that has agreed in writing to be bound by the provisions of
this Section 10.6(f). To the extent permitted by applicable law, in the event that any Bank or the
Administrative Agent is legally requested or required to disclose any confidential information
pursuant to clause (ii), (iii), or (v) of this Section 10.6(f), such party shall promptly notify
the Borrower of such request or requirement prior to disclosure so that Borrower may seek an
appropriate protective order and/or waive compliance with the terms of this Agreement. If,
however, in the opinion of counsel for such party, such party is nonetheless, in the absence of
such order or waiver, compelled to disclose such confidential information or otherwise stand liable
for contempt or suffer possible censure or other penalty or liability, then such party may disclose
such confidential information without liability to the Borrower; provided, however, that
such party will use its best efforts to minimize the disclosure of such information. Subject to
the exceptions above to disclosure of information, each of the Banks and the Administrative Agent
agrees that it shall not publish, publicize, or otherwise make public any information regarding
this Agreement or the transactions contemplated hereby without the written consent of the Borrower,
in its sole discretion.



     (g) If, pursuant to this Section 10.6, any interest in this Agreement or any Loan or L/C
Obligation is transferred to any Transferee that is organized under the laws of any jurisdiction
other than the United States or any state thereof, the transferor Bank shall cause such Transferee,
concurrently with the effectiveness of such transfer, (i) to deliver to the transferor Bank (and,
in the case of any Purchasing Bank registered in the Register, the Administrative Agent and the
Borrower) either U.S. Internal Revenue Service Form W-8BEN or U.S. Internal Revenue Service Form
W-8ECI, or successor applicable forms (wherein such Transferee claims entitlement to complete
exemption from U.S. federal withholding tax on all interest payments hereunder) and



69









 




(ii) to agree (for the benefit of the transferor Bank, the Administrative Agent and the
Borrower) to deliver to the transferor Bank (and, in the case of any Purchasing Bank registered in
the Register, the Administrative Agent and Borrower) a new Form duly executed and completed W-8BEN
or W-8ECI, or successor applicable forms or other manner of certification, as the case may be, upon
the expiration or obsolescence of any previously delivered form in accordance with applicable U.S.
laws and regulations and amendments, unless in any such case any change in treaty, law or
regulation has occurred prior to the date on which any such delivery would otherwise be required
that renders all such forms inapplicable or that would prevent such Transferee from duly completing
and delivering any such form with respect to it and such Transferee so advises the transferor Bank
(and, in the case of any Purchasing Bank registered in the Register, the Administrative Agent and
the Borrower).




     (h) Any Bank 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 Bank, including any pledge or assignment
to secure obligations to a Federal Reserve Bank, and this Section 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 Bank from any of its obligations hereunder or substitute any
such pledgee or Purchasing Bank for such Bank as a party hereto. The Borrower hereby agrees that,
upon request of any Bank at any time and from time to time after the Borrower has made its initial
Borrowing hereunder, the Borrower shall provide to such Bank, at the Borrower’s own expense, a
promissory note, substantially in the form of Exhibit D-1 or Exhibit D-2 evidencing
the Loans or L/C Obligations, as the case may be, owing to such Bank.



     SECTION 10.7. Setoff. In addition to any rights and remedies of the Banks provided by
law, each Bank shall have the right, without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by applicable law, upon any amount
becoming due and payable by the Borrower hereunder or under the Loans to which it is a party
(whether at the stated maturity, by acceleration or otherwise) to setoff and appropriate and apply
against such amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any currency, in each
case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Bank or any branch or agency thereof to or for the credit or the account of the
Borrower. Each Bank agrees promptly to notify the Borrower and the Administrative Agent after any
such setoff and application made by such Bank, provided that the failure to give such notice shall
not affect the validity of such setoff and application.



     SECTION 10.8. Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument. A set of the copies of
this Agreement signed by all the parties shall be maintained with Borrower and the Administrative
Agent.



     SECTION 10.9. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.



70









 





     SECTION 10.10. Integration. This Agreement and the other Loan Documents represent the
agreement of the Borrower, the Administrative Agent and the Banks with respect to the subject
matter hereof, and there are no promises, undertakings, representations or warranties by the
Administrative Agent or any Bank relative to the subject matter hereof not expressly set forth or
referred to herein or in the other Loan Documents.



     SECTION 10.11. GOVERNING LAW. (a) THIS AGREEMENT AND ANY NOTES OR OTHER LOAN
DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND ANY NOTES AND ANY
OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK.



     (b) Notwithstanding anything in Section 10.11(a) to the contrary, nothing in this Agreement or
in any Note or any other Loan Documents shall be deemed to constitute a waiver of any rights which
any Bank may have under applicable federal law relating to the amount of interest which any Bank
may contract for, take, receive or charge in respect of any Loans, including any right to take,
receive, reserve and charge interest at the rate allowed by the laws of the state where such Bank
is located. To the extent that Texas law is applicable to the determination of the Highest Lawful
Rate, the Banks and the Borrower agree that (i) if Chapter 303 of the Texas Finance Code, as
amended, is applicable to such determination, the weekly rate ceiling (formerly known as the
indicated (weekly) rate ceiling in Article 1.04, Subtitle 1, Title 79, of the Revised Civil
Statutes of Texas, as amended) as computed from time to time shall apply, provided that, to
the extent permitted by such Article, the Administrative Agent may from time to time by notice to
the Borrower revise the election of such interest rate ceiling as such ceiling affects the then
current or future balances of the Loans; and (ii) the provisions of Chapter 346 of the Texas
Finance Code, as amended (formerly found in Chapter 15 of Subtitle 3, Title 79, of the Revised
Civil Statutes of Texas, 1925, as amended) shall not apply to this Agreement or any Note issued
hereunder.



     SECTION 10.12. Submission to Jurisdiction; Waivers. The Borrower hereby irrevocably
and unconditionally:



     (a) submits for itself and its property in any legal action or proceeding relating to this
Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement
of any judgment in respect thereof, to the non-exclusive general jurisdiction of the Courts of the
State of New York, the courts of the United States of America for the Southern District of New
York, and appellate courts from any thereof;



     (b) consents that any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;



     (c) agrees that service of process in any such action or proceeding may be effected by mailing
a copy thereof by registered or certified mail (or any substantially similar form of mail), postage
prepaid to the Borrower at its address set forth in Section 10.2 or at such other address of which
the Administrative Agent shall have been notified pursuant thereto;



71









 





     (d) agrees that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other jurisdiction; and



     (e) waives, to the maximum extent permitted by applicable law, any right it may have to claim
or recover in any legal action or proceeding any special, exemplary, punitive or consequential
damages.



     SECTION 10.13. Acknowledgments. The Borrower hereby acknowledges that:



     (a) it has been advised by counsel in the negotiation, execution and delivery of this
Agreement, any Notes and the other Loan Documents;



     (b) neither the Administrative Agent nor any Bank has any fiduciary relationship with or duty
to the Borrower arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between the Administrative Agent and the Banks, on one hand, and
the Borrower, on the other hand, in connection herewith or therewith is solely that of debtor and
creditor; and



     (c) no joint venture exists among the Banks or among the Borrower and the Banks.



     SECTION 10.14. Limitation on Agreements. All agreements between the Borrower, the
Administrative Agent or any Bank, whether now existing or hereafter arising and whether written or
oral, are hereby expressly limited so that in no contingency or event whatsoever, whether by reason
of demand being made in respect of an amount due under any Loan Document or otherwise, shall the
amount paid, or agreed to be paid, to the Administrative Agent or any Bank for the use,
forbearance, or detention of the money to be loaned under this Agreement, any Notes or any other
Loan Document or otherwise or for the payment or performance of any covenant or obligation
contained herein or in any other Loan Document exceed the Highest Lawful Rate. If, as a result of
any circumstances whatsoever, fulfillment of any provision hereof or of any of such documents, at
the time performance of such provision shall be due, shall involve transcending the limit of
validity prescribed by applicable usury law, then, ipso facto, the obligation to be fulfilled shall
be reduced to the limit of such validity, and if, from any such circumstance, the Administrative
Agent or any Bank shall ever receive interest or anything that might be deemed interest under
applicable law that would exceed the Highest Lawful Rate, such amount that would be excessive
interest shall be applied to the reduction of the principal amount owing on account of such Bank’s
Loans or the amounts owing on other obligations of the Borrower to the Administrative Agent or any
Bank under any Loan Document and not to the payment of interest, or if such excessive interest
exceeds the unpaid principal balance of such Bank’s Loans and the amounts owing on other
obligations of the Borrower to the Administrative Agent or any Bank under any Loan Document, as the
case may be, such excess shall be refunded to the Borrower. All sums paid or agreed to be paid to
the Administrative Agent or any Bank for the use, forbearance or detention of the indebtedness of
the Borrower to the Administrative Agent or any Bank shall, to the fullest extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the full term of such
indebtedness until payment in full of the principal (including the period of any renewal or
extension thereof) so that the interest on account of such indebtedness shall not exceed the
Highest Lawful Rate. Notwithstanding anything to the contrary contained in any Loan Document, it is
understood and agreed that if at



72









 







any time the rate of interest that accrues on the outstanding principal balance of any Loan
shall exceed the Highest Lawful Rate, the rate of interest that accrues on the outstanding
principal balance of any Loan shall be limited to the Highest Lawful Rate, but any subsequent
reductions in the rate of interest that accrues on the outstanding principal balance of any Loan
shall not reduce the rate of interest that accrues on the outstanding principal balance of any Loan
below the Highest Lawful Rate until the total amount of interest accrued on the outstanding
principal balance of any Loan equals the amount of interest that would have accrued if such
interest rate had at all times been in effect. The terms and provisions of this Section 10.14 shall
control and supersede every other provision of all Loan Documents.



     SECTION 10.15. Removal of Bank. Notwithstanding anything herein to the contrary, the
Borrower may, at any time in its sole discretion, remove any Bank upon 15 Business Days’ written
notice to such Bank and the Administrative Agent (the contents of which notice shall be promptly
communicated by the Administrative Agent to each other Bank), such removal to be effective at the
expiration of such 15-day notice period; provided, however, that no Bank may be
removed hereunder at a time when an Event of Default shall have occurred and be continuing. Each
notice by the Borrower under this Section 10.15 shall constitute a representation by the Borrower
that the removal described in such notice is permitted under this Section 10.15. Concurrently with
such removal, the Borrower shall pay to such removed Bank all amounts owing to such Bank hereunder
and under any other Loan Document in immediately available funds. Upon full and final payment
hereunder of all amounts owing to such removed Bank, such Bank shall make appropriate entries in
its accounts evidencing payment of all Loans hereunder and releasing the Borrower from all
obligations owing to the removed Bank in respect of the Loans hereunder and surrender to the
Administrative Agent for return to the Borrower any Notes of the Borrower then held by it.
Effective immediately upon such full and final payment, such removed Bank will not be considered to
be a “Bank” for purposes of this Agreement except for the purposes of any provision hereof that by
its terms survives the termination of this Agreement and the payment of the amounts payable
hereunder. Effective immediately upon such removal, the Commitments of such removed Bank shall
immediately terminate and such Bank’s participation share in any outstanding Letters of Credit
shall immediately terminate and such participation share shall be divided among the remaining Banks
according to their Revolving Percentages. Such removal will not, however, affect the Commitments
of any other Bank hereunder.



     SECTION 10.16. Officer’s Certificates. It is not intended that any certificate of any
officer of the Borrower delivered to the Administrative Agent or any Bank pursuant to this
Agreement shall give rise to any personal liability on the part of such officer.



     SECTION 10.17. USA Patriot Act. Each Bank and the Administrative Agent (for itself
and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
“Patriot Act”), it is required to obtain, verify and record information that identifies the
Borrower, which information includes the name and address of the Borrower and other information
that will allow such Bank or the Administrative Agent, as applicable, to identify the Borrower in
accordance with the Patriot Act. The Borrower shall, and shall cause each of its Subsidiaries to,
provide, to the extent commercially reasonable, such information and take such actions as are



73









 







reasonably requested by each Bank and the Administrative Agent to maintain compliance with the
Patriot Act.



74









 





          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective officers thereunto duly authorized, as of the date first above written.




	 	 	 	 	 
	 	CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC

 	 
	 	By:  	/s/
Marc Kilbride	 
	 	 	Name:  	Marc Kilbride	 
	 	 	Title:  	Vice President and Treasurer	 
	 



CEHC Credit Agreement — Signature Page




 









 








	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A.,

as Administrative Agent and as a Bank

 	 
	 	By:  	/s/
Robert Traband	 
	 	 	Name:  	Robert Traband	 
	 	 	Title:  	Executive Director	 
	 



CEHC Credit Agreement — Signature Page





 









 








	 	 	 	 	 
	 	BARCLAYS BANK PLC,

as Co-Syndication Agent and as a Bank

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



CEHC Credit Agreement — Signature Page





 









 








	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as

Co-Syndication Agent and as a Bank

 	 
	 	By:  	/s/
Henry R. Biedrzycki	 
	 	 	Name:  Henry R. Biedrzycki	 
	 	 	Title: Director	 	 
	 



CEHC Credit Agreement — Signature Page





 









 








	 	 	 	 	 
	 	DEUTSCHE BANK SECURITIES INC., as

Co-Documentation Agent and as a Bank

 	 
	 	By:  	/s/
Ming K. Chu	 
	 	 	Name:  Ming K. Chu	 
	 	 	Title:  Vice President	 
	 
	 	By: 	/s/
Rainer Meier	 
	 	 	Name:  Rainer Meier	 
	 	 	Title:  Vice President	 



CEHC Credit Agreement — Signature Page





 









 








	 	 	 	 	 
	 	UBS SECURITIES LLC, as Co-Documentation Agent

 	 
	 	By:  	/s/
Irja R. Otsa	 
	 	 	Name:  Irja R. Otsa	 
	 	 	Title:  Associate Director
Banking Products Services, US
	 



CEHC Credit Agreement — Signature Page








 









 





	 	 	 	 	 
	 	Citibank, N.A., as a Lender 

 	 
	 	By:  	/s/ Nietzsche Rodricks
 	 
	 	 	Name:  	Nietzsche Rodricks 	 
	 	 	Title:  	Vice President 	 
	 



CEHE Credit Agreement—Signature Page




 









 








	 	 	 	 	 
	 	Bank of America, N.A. 

 	 
	 	By:  	/s/ John P. Wofford
 	 
	 	 	Name:  	John P. Wofford 	 
	 	 	Title:  	Vice President 	 
	 



CEHE Credit Agreement—Signature Page





 









 










	 	 	 	 	 
	 	DEUTCHE BANK AG NEW YORK BRANCH 

 	 
	 	/s/
Marcus Tarlington
 	 
	 	Name:  	Marcus Tarlington      	 
	 	Title:  	Director 	 
	 
	 	 	 
	 	
/s/   Rainer Meier
 	 
	 	Name:  	Rainer Meier 	 
	 	Title:  	Vice President 	 


CEHE Credit Agreement—Signature Page




 









 








	 	 	 	 	 
	 	ABN AMRO Bank N.V. 

 	 
	 	By:  	/s/ Jim Moyes
 	 
	 	 	Name:  	Jim Moyes 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                             /s/ Scott Donaldson
 	 
	 	 	Name:  	Scott Donaldson  	 
	 	 	Title:  	Director 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	[The Bank of Nova Scotia] 

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



CEHE Credit Agreement—Signature Page





 









 





	 	 	 	 	 
	 	Credit Suisse, Cayman Islands Branch

 	 
	 	By:  	/s/ Brain Caldwell
 	 
	 	 	Name:  	Brain Caldwell 	 
	 	 	Title:  	Director 	 
	 
	 	 	 
	 	By:  	                        /s/ Nupur Kumar
 	 
	 	 	Name:  	Nupur Kumar 	 
	 	 	Title:  	Associate 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	THE ROYAL BANK OF SCOTLAND PLC 

 	 
	 	By:  	/s/ Emily Freedman
 	 
	 	 	Name:  	Emily Freedman  	 
	 	 	Title:  	Vice  President 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	UBS LOAN FINANCE LLC 

 	 
	 	By:  	/s/  Irja R. Otsa
 	 
	 	 	Name:  	Irja R. Otsa        	 
	 	 	Title:  	Associate Director 	 
	 
	 	UBS LOAN FINANCE LLC

 	 
	 	By:  	/s/ Mary E.  Eyans
 	 
	 	 	Name:  	Mary E.  Eyans 	 
	 	 	Title:  	Associate Director 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	The Bank of Tokyo-Mitsubishi UFJ

Limited, New York Branch

 	 
	 	By:  	/s/ Alan Reiter
 	 
	 	 	Name:  	A. Reiter 	 
	 	 	Title:  	Authorized Signatory 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	MORGAN STANLEY BANK 

 	 
	 	By:  	
/s/ Daniel Twenge
 	 
	 	 	Name:  	DanielTwenge 	 
	 	 	Title:  	Authorized Signatory

Morgan stanley Bank 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	LEHMAN BROTHERS BANK, FSB 

 	 
	 	By:  	/s/ Errington Hibbert
 	 
	 	 	Name:  	Errington Hibbert 	 
	 	 	Title:  	Managing Director 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	SunTrust Bank 

 	 
	 	By:  	/s/ Yann Pirio
 	 
	 	 	Name: Yann Pirio	 
	 	 	Title: Vice President   	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	HSBC Bank USA, N.A. 

 	 
	 	By:  	/s/  Jennifer Diedzic
 	 
	 	 	Name:  	Jennifer Diedzic 	 
	 	 	Title:  	Assistant Vice President 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	ROYAL BANK OF CANADA

 	 
	 	By:  	/s/  David A. McCluskey
 	 
	 	 	Name:  	David A. McCluskey  	 
	 	 	Title:  	Authorized Signatory 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	Comerica Bank 

 	 
	 	By:  	/s/ Chuck Johnson
 	 
	 	 	Name:  	Chuck Johnson 	 
	 	 	Title:  	Vice President 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	The Northern Trust Company

 	 
	 	By:  	/s/  Peter Hallan
 	 
	 	 	Peter Hallan  	 
	 	 	Vice President 	 
	 



CEHE Credit Agreement—Signature Page





 









 








	 	 	 	 	 
	 	Wells Fargo Bank, N.A. 

 	 
	 	By:  	/s/ Jo Ann Vasquez
 	 
	 	 	Name:  	Jo Ann Vasquez 	 
	 	 	Title:  	Vice President 	 
	 



CEHE Credit Agreement—Signature Page





 










 





Schedule l.1(A) 




SCHEDULE OF COMMITMENTS AND ADDRESSES




	 	 	 	 	 
	Names and Address of Banks	 	Commitment
	JPMorgan Chase Bank, N.A,
	 	$	22,040,816.33	 
	600 Travis, 20th Floor

Houston, TX 77002

Attn: Robert Traband

Tel: 713-216-1081

Telecopy: 713-216-8870

Robert.trabank@jpmorgan.com
	 	 	 	 
	 
	 	 	 	 
	Citibank, N.A.
	 	$	22,040,816.33	 
	388 Greenwich Street, 21st Floor

New York, NY 10013

Attn: Sandip Sen

Tel: 212-816-8609

Telecopy: 212-816-8098

sandip1.sen@citigroup.com
	 	 	 	 
	 
	 	 	 	 
	Bank of America, N.A.
	 	$	21,428,571.43	 
	100 North Tryon Street

Charlotte, NC 28255

Attn: Kevin Bertelsen

Tel: 704-386-4668

Telecopy: 704-386-1319

kevin.p.bertelsen@bankofamerica.com
	 	 	 	 
	 
	 	 	 	 
	Barclays Bank plc
	 	$	21,428,571.43	 
	200 Park Avenue

New York, NY 10166

Attn: Sydney Dennis

Tel: 212-412-2470

Telecopy: 212-412-2441

sydney.dennis@barcap.com
	 	 	 	 
	 
	 	 	 	 
	Deutsche Bank AG New York Branch
	 	$	21,428,571.43	 
	60 Wall Street, 11th Floor

New York, NY 10005

Attn: Joel Makowsky

Tel: 212-250-7896

Telecopy: 212-797-4346

joel.makowsky@db.com
	 	 	 	 







Schedule 1.1 (A) to the CenterPoint Energy Houston Electric, LLC Second Amended and Restated Credit

Agreement




 









 





	 	 	 	 	 
	Names and Address of Banks	 	Commitment
	Wachovia Bank, N.A.
	 	$	21,428,571.43	 
	191 Peachtree Street NE Suite 2800

Mailcode: GA8050

Atlanta, GA 28244

Attn: Rotcher Watkins

Tel: 404-332-6211.

Telecopy: 404-332-4058

rotcher.watkins@wachovia.com
	 	 	 	 
	 
	 	 	 	 
	ABN AMRO Bank, N. V.
	 	$	18,367,346.94	 
	540 West Madison Street, Suite 2621

Chicago, IL 60661

Attn: Melanie Dziobas

Tel: 312-992-5110

Telecopy: 312-992-5111

melanie.dziobas@abnamro.com
	 	 	 	 
	 
	 	 	 	 
	The Bank of Nova Scotia
	 	$	18,367,346.94	 
	1 Liberty Plaza, 26th Floor

New York, NY 10006

Attn: Denis O’Meara

Tel: 212-225-5493

Telecopy: 212-225-5480

denis_omeara@scotiacapital.com
	 	 	 	 
	 
	 	 	 	 
	Credit Suisse, Cayman Islands Branch
	 	$	18,367,346.94	 
	11 Madison Avenue

New York NY 10010

Attn: Bill Fox

Tel: 212-325-9923

Telecopy: 212-743-2155

bill.fox@csfb.com
	 	 	 	 
	 
	 	 	 	 
	The Royal Bank of Scotland plc
	 	$	18,367,346.94	 
	101 Park Avenue

New York, NY 10006

Attn: Iris Chen

Tel: 212-401-3526

Telecopy: 212-401-3456

iris.chen@rbos.com
	 	 	 	 
	 
	 	 	 	 
	UBS Loan Finance LLC
	 	$	18,367,346.94	 
	677 Washington Blvd. 6th Floor So.

Stamford, CT 06901

Attn: David Vitti

Tel: 203-719-5968

Telecopy: 203-719-3888

david.vitti@ubs.com
	 	 	 	 
	 
	 	 	 	 






Schedule 1.1 (A) to the CenterPoint Energy Houston Electric, LLC Second Amended and Restated Credit

Agreement




 









 





	 	 	 	 	 
	Names and Address of Banks	 	Commitment
	The Bank of Tokyo-Mitsubishi UFJ, Ltd,
	 	$	11,020,408.16	 
	New York Branch

1251 Avenue of the Americas, 12th Floor

New York, NY 10020-1104

Attn: Alan Reiter

Tel: 212-782-5649

Telecopy: 212-782-6440

areiter@us.mufg.jp
	 	 	 	 
	 
	 	 	 	 
	Morgan Stanley Bank
	 	$	11,020,408.16	 
	750 Seventh Avenue

New York, NY 10008

Attn: Erma Dell’Aquila

Tel: 718-754-7286

Telecopy: 718-754-7249

erma.dell’aquila@morganstanley.com
	 	 	 	 
	 
	 	 	 	 
	Lehman Brothers Bank, FSB
	 	$	11,020,408.16	 
	745 Seventh Avenue

New York, NY 10019

Attn: Janine Shugan

Tel: 212-526-8625

Telecopy: 201-508-4654

jshugan@lehman.com
	 	 	 	 
	 
	 	 	 	 
	SunTrust Bank
	 	$	11,020,408.16	 
	303 Peachtree Street N.E., 10th Floor

Atlanta, GA 30308

Attn: Linda Stanley

Tel: 404-532-0989

Telecopy: 404-827-6270

linda.stanley@suntrust.com
	 	 	 	 
	 
	 	 	 	 
	HSBC Bank USA, N.A.
	 	$	9,183,673.47	 
	1105 North Market St., Suite 1

Wilmington, DE 19801

Attn: Richard Ward

Tel: 212-525-6476

Telecopy: 212-525-6581

richard.ward@us.hsbc.com
	 	 	 	 
	 
	 	 	 	 
	Royal Bank of Canada
	 	$	9,183,673.47	 
	5700 Williams Tower

2800 Post Oak Blvd

Houston, TX 77056

Attn: Linda Stephens

Tel: 713-403-5669

Telecopy: 713-403-5624

linda.stephens@rbc.com
	 	 	 	 
	 
	 	 	 	 






Schedule 1.1(A) to the CenterPoint Energy Houston Electric, LLC Second Amended and Restated Credit

Agreement




 









 





	 	 	 	 	 
	Names and Address of Banks	 	Commitment
	Comerica Bank
	 	$	6,122,448.98	 
	910 Louisiana-St. Ste 400

Houston, TX 77002

Attn: Charles T. Johnson

Tel: 713-220-5662

Telecopy: 713-220-5631

ctjohnson@comedca.com
	 	 	 	 
	 
	 	 	 	 
	The Northern Trust Company
	 	$	4,897,959.18	 
	50 South LaSalle Street

Chicago, IL 60690

Attn: Preeti Sullivan

Tel: 312-444-2376

Telecopy: 312-444-4906

pj22@ntrs.com
	 	 	 	 
	 
	 	 	 	 
	Wells Fargo Bank, N.A.
	 	$	4,897,959.18	 
	201 3rd Street, 8th Floor

San Francisco, CA 94103

Attn:C.E. Gerndt Jr.

Tel: 415-477-5294

Telecopy: 415-979-0675

CEGerndt@wellsfargo.com
	 	 	 	 
	 
	 	 	 	 
	Total:
	 	$	300,000,000.00	 
	 
	 	 	 	 






Schedule 1.1(A) to the CenterPoint Energy Houston Electric, LLC Second Amended and Restated Credit

Agreement