EXHIBIT 4.23


 


	
  30
  April, 2003

  
	
   

  	
   

  
	
   

  	
   

  
	
  Kentucky
  Utilities  

  	
   

  
	
  (as Borrower)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Fidelia
  Corporation

  	
   

  
	
  (as Lender) 

  	
   

  



 


 












 


LOAN
AGREEMENT


 












 


 

















 


Contents


 


	
  Clause

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  TERM LOAN

  	
   

  
	
   

  	
   

  	
   

  
	
  3.

  	
  AVAILABILITY
  OF REQUESTS

  	
   

  
	
   

  	
   

  	
   

  
	
  4.

  	
  INTEREST

  	
   

  
	
   

  	
   

  	
   

  
	
  5.

  	
  REPAYMENT
  AND PREPAYMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  6.

  	
  PAYMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  7.

  	
  TERMINATION
  EVENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  8.

  	
  OPERATIONAL
  BREAKDOWN

  	
   

  
	
   

  	
   

  	
   

  
	
  9.

  	
  NOTICES

  	
   

  
	
   

  	
   

  	
   

  
	
  10.

  	
  ASSIGNMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  11.

  	
  SEVERABILITY

  	
   

  
	
   

  	
   

  	
   

  
	
  12.

  	
  COUNTERPARTS

  	
   

  
	
   

  	
   

  	
   

  
	
  13.

  	
  LAW

  	
   

  



 

















 


THIS AGREEMENT made on April 30, 2003


 


Between


 


KENTUCKY UTILITIES, a Kentucky corporation,
as borrower (the Borrower);
and


 


FIDELIA CORPORATION, a Delaware
corporation, as lender (the Lender).


 


Whereas


 


(A)          The Lender and the
Borrower hereby enter into an agreement for the provision by the Lender to the
Borrower of a loan in the amount of 
$100,000,000 (the Loan Amount).


 


Now it is hereby agreed as follows:


 


1.             Definitions


 


1.1           In this Agreement


 


Business Day means a day on which
banks in New York are generally open


 


Default Interest Rate means: the rate,
as determined by the Lender, applying to the principal element of an overdue
amount under Clause 6.3, calculated as the sum of the interest rate in effect
immediately before the due date of such amount, plus 1%;


 


Effective Date shall have the meaning
given to it in Clause 2.1;


 


Final Repayment Date means April 30,
2013;


 


Interest Payment Date means April 30
and October 30 of each year during the term of this agreement, provided,
that:


 


any Interest Payment Date
which is not a Business Day shall be extended to the next succeeding Business
Day;


 


Loan Amount  means $100,000,000;


 


Maturity Date means the Final
Repayment Date;


 


1

















 


Request means a request for the Loan
Amount from the Borrower to the Lender under the terms of clause 3.1;


 


Termination Event means an event
specified as such in Clause 7;


 


Value Date means the date upon which
cleared funds are made available to the Borrower by the Lender pursuant to a
Request made in accordance with Clause 3.1. Such date shall be a Business
Day as defined herein.


 


2.             Term Loan


 


2.1           This Agreement shall come into effect on April 30, 2003 (the
“Effective Date”).


 


2.2           The Lender grants to the Borrower upon the terms and
conditions of this Agreement a term loan in an amount of $100,000,000.


 


2.3           The new indebtedness shall be evidenced by a note in
substantially the form of Exhibit “A” attached hereto.


 


3.             Availability of Requests


 


3.1           On the Effective Date, the Borrower will submit a request
(the “Request”) to the Lender for the Loan Amount, such Request specifying the
Value Date, the Maturity Date and the bank account to which payment is to be
made. The Request shall be submitted to the Lender by the Borrower and
delivered in accordance with Clause 9.3.


 


4.             Interest


 


4.1           The rate of interest on the Loan Amount is 4.55%.


 


4.2           Interest shall accrue on the basis of a 360-day year
consisting of twelve 30 day months upon the Loan Amount.


 


4.3           Interest shall be payable in arrears on each Interest
Payment Date.


 


2

















 


5.             Repayment and Prepayment


 


5.1           The Borrower shall repay the Loan Amount together with all
interest accrued thereon and all other amounts due from the Borrower hereunder
on the Final Repayment Date, whereupon this Agreement shall be terminated.


 


5.2           On any Interest Payment Date, and with at least three
business day’s prior written notice, the Borrower shall be entitled to prepay
any amount of the loan outstanding, provided such payment is not less than
$1,000,000 and, provided further, the Borrower shall pay a prepayment charge
equal to the present value of the difference between (i) the interest payable
provided in this loan agreement and (ii) the interest payable at the prevailing
interest rate at the time of prepayment, for the period from the date of
prepayment through the Maturity Date, 
which difference, if negative, shall be deemed to be zero. The present
value will be determined using the prevailing interest rate at the time of the
prepayment as the discount rate.


 


5.3           A certificate from the Lender as to the amount due at any
time from the Borrower to the Lender under this Agreement shall, in the absence
of manifest error, be conclusive.


 


6.             Payments


 


6.1           All payments of principal to be made to the Lender by the
Borrower shall be made on the Final Repayment Date, or on an Interest Payment
Date under Clause (5.2) to such account as the Lender shall have specified.


 


6.2           Interest shall be payable in arrears on each Interest
Payment Date.


 


6.3           If and to the extent that full payment of any amount due
hereunder is not made by the Borrower on the due date then, interest shall be
charged at the Default Interest Rate on such overdue amount from the date of
such default to the date payment is received by the Lender.


 


3

















 


7.             Termination Events


 


7.1           The Borrower shall notify the Lender of any Event of Default
(and the steps, if any, being taken to remedy it) promptly upon becoming aware
of it.


 


7.2           The following shall constitute an Event of Default
hereunder:


 


7.2.1        Default is made by the Borrower in the payment of any sum
due under this Agreement and such default continues for a period of 10 Business
Days;


 


7.2.2        Bankruptcy proceedings are initiated against the Borrower;


 


7.2.3        The Borrower leaves the E.ON Group (i.e. the companies
consolidated in EON AG’s balance sheet);


 


7.2.4        Securities and Exchange Commission or Public Utility Holding
Company Act (PUHCA) requirements prohibit the transactions hereunder.


 


If
a Termination Event occurs under Clause (7.2.2) of this section, the Loan
Amount outstanding together with interest will become due and payable
immediately.


 


If
a Termination Event occurs according to Clauses (7.2.1) or (7.2.3) or (7.2.4)
of this Section, Lender shall at its discretion grant Borrower a reasonable
grace period unless such grace period shall be detrimental to the Lender. If
the Termination Event is uncured at the expiration of such period, the Loan
Amount outstanding together with interest will become due and payable immediately.


 


8.             Operational Breakdown


 


8.1           The
Borrower is not liable for any damages incurred by the Lender and the Lender is
not liable for any damages incurred by the Borrower caused by Acts of God or
other circumstances incurred by one party for which the other party cannot be
held responsible (i.e. power outages, strikes, lock-outs, domestic and foreign
acts of government and the like).


 


4

















 


9.             Notices


 


9.1           Each communication to be made in respect of this Agreement
shall be made in writing but, unless otherwise stated, may be made by facsimile
transmission or letter.


 


9.2           Communications to the Borrower shall be addressed to:
Kentucky Utilities, 220 W. Main St., Louisville, KY 40202, Attn: Treasurer fax#
(502)627-4742 except for confirmations which should be sent to the attention of
Mimi Kelly.


 


9.3           Communications to the Lender shall be addressed to: Fidelia
Corporation, 300 Delaware Avenue, Suite 545, Wilmington, Delaware 19801, fax#
(302) 427-5913, Attn: President


 


10.          Assignment


 


10.1         The Lender may at any time assign, novate or otherwise
transfer all or any part of its rights and obligations under this Agreement to
any affiliate of the Lender.


 


11.          Severability


 


11.1         If any of the provisions
of this Agreement becomes invalid, illegal or unenforceable in any respect
under any law, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired.


 


12.          Counterparts


 


12.1         This Agreement may be
executed in any number of counterparts that shall together constitute one
Agreement. Any party may enter into an Agreement by signing any such
counterpart.


 


5

















 


13.          Law


 


13.1         This Agreement shall be
governed by and construed for all purposes in accordance with the laws of
Delaware.


 


IN WITNESS whereof
the parties have executed this Agreement the day and year first above written.


 


 


	
  SIGNED by

  	
   

  	
   

  	
  )

  
	
  for and on behalf of

  	
  )

  
	
  Kentucky Utilities

  	
  )

  
	
  in the presence of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNED by

  	
   

  	
   

  	
  )

  
	
  Udo Koch, President

  	
  )

  
	
  Fidelia Corporation

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNED by

  	
   

  	
   

  	
  )

  



 


6

















 


EXHIBIT “A”


 


PROMISSORY
NOTE


 


	
  U.S. $100,000,000.00

  	
   

  	
  Louisville,
  Kentucky, April 30, 2003

  



 


Kentucky Utilities, for
value received, hereby promises to pay to the order of FIDELIA Corporation
(“FIDELIA”), in lawful money of the United States of America (in freely
transferable U.S. dollars and in same day funds), in accordance with the method
of payment specified in that certain Kentucky Utilities Loan Agreement dated as
of April 30, 2003, between FIDELIA and Kentucky Utilities (“the Agreement”),
the principal sum of $100,000,000.00, which amount shall be payable at such
times as provided in the Agreement.


 


Kentucky Utilities
promises also to pay interest on the unpaid principal amount hereof in like
money and in like manner at the rates which shall be determined in accordance
with the provisions of the Agreement, said interest to be payable at the time
provided for in the Agreement.  This
Note is referred to in the Agreement and is entitled to the benefits thereof
and the security contemplated thereby. 
This Note evidences a loan made by FIDELIA, during such time as such
loan is being maintained.  This Note is
subject to prepayment as specified in the Agreement.  In case Kentucky Utilities defaults on the loan, the principal
and accrued interest on this Note may be declared to be due and payable in the
manner and with the effect provided in the Agreement.


 


Kentucky Utilities hereby
waives presentment, demand, protest or notice of any kind in connection with
this Note.


 


This Note shall be
governed and construed and interpreted in accordance with the laws of the State
of Delaware.


 


	
   

  	
  Kentucky Utilities

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Daniel K. Arbough

  
	
   

  	
   

  	
  Director of Corporate
  Finance & Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
					



 


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