exv10w5






Exhibit 10.5




 

 






Published Deal CUSIP Number:                     




CREDIT AGREEMENT




Dated as of December 3, 2008




among




PIEDMONT NATURAL GAS COMPANY, INC.

as the Borrower,




BANK OF AMERICA, N.A.,

as Administrative Agent,




and




The Other Lenders Party Hereto




BANC OF AMERICA SECURITIES LLC,

as

Sole Lead Arranger and Sole Book Manager




 

 






 









 





Table of Contents




	 	 	 	 	 	 	 
	 	 	Section	 	Page
	 

	 	ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS	 	 	 	 
	1.01

	 	Defined Terms
	 	 	1	 
	1.02

	 	Other Interpretive Provisions
	 	 	20	 
	1.03

	 	Accounting Terms
	 	 	20	 
	1.04

	 	Rounding
	 	 	21	 
	1.05

	 	Times of Day
	 	 	21	 
	 

	 	ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS	 	 	 	 
	 
	 	 	 	 	 	 
	2.01

	 	Loans
	 	 	21	 
	2.02

	 	Borrowings and Conversions of Loans
	 	 	22	 
	2.03

	 	[Reserved]
	 	 	23	 
	2.04

	 	[Reserved]
	 	 	32	 
	2.05

	 	Prepayments
	 	 	34	 
	2.06

	 	Termination or Reduction of Commitments
	 	 	35	 
	2.07

	 	Repayment of Loans
	 	 	36	 
	2.08

	 	Interest
	 	 	36	 
	2.09

	 	Fees
	 	 	37	 
	2.10

	 	Computation of Interest and Fees
	 	 	37	 
	2.11

	 	Evidence of Debt
	 	 	37	 
	2.12

	 	Payments Generally; Administrative Agent’s Clawback
	 	 	38	 
	2.13

	 	Sharing of Payments by Lenders
	 	 	40	 
	 

	 	ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY	 	 	 	 
	 
	 	 	 	 	 	 
	3.01

	 	Taxes
	 	 	43	 
	3.02

	 	Illegality
	 	 	45	 
	3.03

	 	Inability to Determine Rates
	 	 	45	 
	3.04

	 	Increased Costs
	 	 	46	 
	3.05

	 	[Reserved]
	 	 	47	 
	3.06

	 	Mitigation Obligations; Replacement of Lenders
	 	 	48	 
	3.07

	 	Survival
	 	 	48	 
	 

	 	ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS	 	 	 	 
	 
	 	 	 	 	 	 
	4.01

	 	Conditions of Initial Credit Extension
	 	 	48	 
	4.02

	 	Conditions to all Credit Extensions
	 	 	50	 
	 

	 	ARTICLE V.

REPRESENTATIONS AND WARRANTIES	 	 	 	 






 i 









 






	 	 	 	 	 	 	 
	5.01

	 	Existence, Qualification and Power
	 	 	51	 
	5.02

	 	Authorization; No Contravention
	 	 	51	 
	5.03

	 	Governmental Authorization; Other Consents
	 	 	51	 
	5.04

	 	Binding Effect
	 	 	51	 
	5.05

	 	Financial Statements; No Material Adverse Effect; No Internal Control Event
	 	 	51	 
	5.06

	 	Litigation
	 	 	52	 
	5.07

	 	No Default
	 	 	52	 
	5.08

	 	Ownership of Property; Liens
	 	 	52	 
	5.09

	 	Environmental Compliance
	 	 	52	 
	5.10

	 	Insurance
	 	 	53	 
	5.11

	 	Taxes
	 	 	53	 
	5.12

	 	ERISA Compliance
	 	 	53	 
	5.13

	 	Subsidiaries; Equity Interests
	 	 	54	 
	5.14

	 	Margin Regulations; Investment Company Act
	 	 	54	 
	5.15

	 	Disclosure
	 	 	54	 
	5.16

	 	Compliance with Laws
	 	 	54	 
	5.17

	 	Taxpayer Identification Number
	 	 	55	 
	 

	 	ARTICLE VI.

AFFIRMATIVE COVENANTS	 	 	 	 
	 
	 	 	 	 	 	 
	6.01

	 	Financial Statements
	 	 	55	 
	6.02

	 	Certificates; Other Information
	 	 	56	 
	6.03

	 	Notices
	 	 	57	 
	6.04

	 	Payment of Obligations
	 	 	58	 
	6.05

	 	Preservation of Existence, Etc
	 	 	58	 
	6.06

	 	Maintenance of Properties
	 	 	58	 
	6.07

	 	Maintenance of Insurance
	 	 	58	 
	6.08

	 	Compliance with Laws
	 	 	58	 
	6.09

	 	Books and Records
	 	 	59	 
	6.10

	 	Inspection Rights
	 	 	59	 
	6.11

	 	Use of Proceeds
	 	 	59	 
	6.12

	 	Guarantors
	 	 	59	 
	 

	 	ARTICLE VII.

NEGATIVE COVENANTS	 	 	 	 
	 
	 	 	 	 	 	 
	7.01

	 	[Reserved]
	 	 	60	 
	7.02

	 	Fundamental Changes
	 	 	61	 
	7.03

	 	Change in Nature of Business
	 	 	62	 
	7.04

	 	Transactions with Affiliates
	 	 	62	 
	7.05

	 	Burdensome Agreements
	 	 	62	 
	7.06

	 	Ratio of Consolidated Funded Indebtedness to Total Capitalization
	 	 	63	 
	7.07

	 	Amendments to Note Agreements
	 	 	63	 






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	 	ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES	 	 	 	 
	 
	 	 	 	 	 	 
	8.01

	 	Events of Default
	 	 	63	 
	8.02

	 	Remedies Upon Event of Default
	 	 	65	 
	8.03

	 	Application of Funds
	 	 	65	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE IX.

ADMINISTRATIVE AGENT	 	 	 	 
	 
	 	 	 	 	 	 
	9.01

	 	Appointment and Authority
	 	 	66	 
	9.02

	 	Rights as a Lender
	 	 	67	 
	9.03

	 	Exculpatory Provisions
	 	 	67	 
	9.04

	 	Reliance by Administrative Agent
	 	 	68	 
	9.05

	 	Delegation of Duties
	 	 	68	 
	9.06

	 	Resignation of Administrative Agent
	 	 	68	 
	9.07

	 	Non-Reliance on Administrative Agent and Other Lenders
	 	 	69	 
	9.08

	 	No Other Duties, Etc
	 	 	70	 
	9.09

	 	Administrative Agent May File Proofs of Claim
	 	 	70	 
	9.10

	 	Guaranty Matters
	 	 	70	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE X.

MISCELLANEOUS	 	 	 	 
	10.01

	 	Amendments, Etc
	 	 	71	 
	10.02

	 	Notices; Effectiveness; Electronic Communication
	 	 	72	 
	10.03

	 	No Waiver; Cumulative Remedies
	 	 	74	 
	10.04

	 	Expenses; Indemnity; Damage Waiver
	 	 	74	 
	10.05

	 	Payments Set Aside
	 	 	76	 
	10.06

	 	Successors and Assigns
	 	 	76	 
	10.07

	 	Treatment of Certain Information; Confidentiality
	 	 	80 	 
	10.08

	 	Right of Setoff
	 	 	81	 
	10.09

	 	Interest Rate Limitation
	 	 	81	 
	10.10

	 	Counterparts; Integration; Effectiveness
	 	 	81	 
	10.11

	 	Survival of Representations and Warranties
	 	 	82	 
	10.12

	 	Severability
	 	 	82	 
	10.13

	 	Replacement of Lenders
	 	 	82	 
	10.14

	 	Governing Law; Jurisdiction; Etc
	 	 	83	 
	10.15

	 	Waiver of Jury Trial
	 	 	84	 
	10.16

	 	No Advisory or Fiduciary Responsibility
	 	 	84	 
	10.17

	 	USA PATRIOT Act Notice
	 	 	85	 
	 
	 	 	 	 	 	 






	 	 	 	 	 	 	 
	SIGNATURES

	 	 	 	 	S-1	 






 iii 









 






SCHEDULES




	 	 	 	 	 	 	 
	 

	 	 	2.01	 	 	Commitments and Applicable Percentages
	 

	 	 	5.13	 	 	Subsidiaries; Other Equity Investments
	 

	 	 	10.02	 	 	Administrative Agent’s Office; Certain Addresses for Notices
	 

	 	 	10.06	 	 	Processing and Recordation Fees






EXHIBITS




	 	 	 	 	 
	 	 	 	 	Form of
	 

	 	A
	 	Loan Notice
	 

	 	B
	 	Note
	 

	 	C
	 	Compliance Certificate
	 

	 	D
	 	Assignment and Assumption
	 

	 	E
	 	Guaranty
	 

	 	F
	 	Opinion Matters






 iv 









 






CREDIT AGREEMENT




     This CREDIT AGREEMENT (“Agreement”) is entered into as of December 3, 2008, among
PIEDMONT NATURAL GAS COMPANY, INC., a North Carolina corporation (the “Borrower”), each
lender from time to time party hereto (collectively, the “Lenders” and individually, a
“Lender”), and BANK OF AMERICA, N.A., as Administrative Agent.



     The Borrower has requested that the Lenders provide a revolving credit facility, and the
Lenders are willing to do so on the terms and conditions set forth herein.



     In consideration of the mutual covenants and agreements herein contained, the parties hereto
covenant and agree as follows:



ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS




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



     “Administrative Agent” means Bank of America in its capacity as administrative agent
under any of the Loan Documents, or any successor administrative agent.



     “Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 10.02, or such other address or account as
the Administrative Agent may from time to time notify to the Borrower and the Lenders.



     “Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.



     “Affiliate” means, with respect to any Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.



     “Aggregate Commitments” means the Commitments of all the Lenders, which, as of the
Closing Date, are $150,000,000.



     “Agreement” means this Credit Agreement.



     “Alternative Base Rate” means, for all Loans, on any day any such Loan is outstanding,
the fluctuating rate of interest (rounded upwards, as necessary, to the nearest 1/100 of 1%) equal
to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or
other commercially available source providing quotations of BBA LIBOR as designated by the
Administrative Agent from time to time) at approximately 11:00 a.m., London time, on each day any
such Loan is outstanding, for Dollar deposits with a term of one month, as adjusted from time to
time in the Administrative Agent’s sole discretion for changes in deposit insurance requirements
and other regulatory costs. If such rate is not available at such time for any reason, then the
“Alternative Base Rate” shall be the rate per annum determined by the Administrative



1









 



Agent to be the rate at which deposits in Dollars for delivery in immediately available funds in the
approximate amount of the Dollar denominated Loans outstanding with a term equivalent to one month
would be offered by the Administrative Agent’s London Branch to major banks in the London interbank
eurodollar market at their request at approximately 11:00 a.m. (London time), on each day any such
Loan is outstanding.




     “Applicable Percentage” means with respect to any Lender at any time, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments represented by such Lender’s
Commitment at such time. If the commitment of each Lender to make Loans has been terminated
pursuant to Section 8.02 or if the Aggregate Commitments have expired, then the Applicable
Percentage of each Lender shall be determined based on the Applicable Percentage of such Lender
most recently in effect, giving effect to any subsequent assignments. The initial Applicable
Percentage of each Lender is set forth opposite the name of such Lender on Schedule 2.01 or
in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as
applicable.



     “Applicable Rate” means, from time to time, the following percentages per annum, based
upon the Debt Rating as set forth below:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	Applicable Rate
	 	 	 	 	 	 	 	 	 	 	 	 	 	Applicable Rate for LIBOR
	Pricing	 	 	Debt Ratings	 	 	Applicable Rate for	 	 	Floating Rate Loans and
	Level	 	 	S&P/Moody’s	 	 	Commitment Fee	 	 	Base RateLoans
	 	 	 	 	 	 	 	 	 	 
	1
	 	 	≥ AA-/Aa3	 	 	 	0.20	%	 	 	 	0.75	%
	2
	 	 	 	A+/A1	 	 	 	 	0.20	%	 	 	 	1.00	%
	3
	 	 	 	A/A2	 	 	 	 	0.25	%	 	 	 	1.25	%
	4
	 	 	 	A-/A3	 	 	 	 	0.30	%	 	 	 	1.50	%
	5
	 	 	≤ BBB+/Baa1	 	 	 	0.40	%	 	 	 	1.75	%







     “Debt Rating” means, as of any date of determination, the rating as determined
by either S&P or Moody’s (collectively, the “Debt Ratings”) of the Borrower’s
non-credit-enhanced, senior unsecured long-term debt; provided that (a) if the
respective Debt Ratings issued by the foregoing rating agencies differ by one level, then
the Pricing Level for the higher of such Debt Ratings shall apply (with the Debt Rating for
Pricing Level 1 being the highest and the Debt Rating for Pricing Level 5 being the lowest);
(b) if there is a split in Debt Ratings of more than one level, then the Pricing Level that
is one level lower than the Pricing Level of the higher Debt Rating shall apply; (c) if the
Borrower has only one Debt Rating, the Pricing Level of such Debt Rating shall apply; and
(d) if the Borrower does not have any Debt Rating, Pricing Level 5 shall apply.


Initially, the Applicable Rate shall be determined based upon the Debt Rating specified in the
certificate delivered pursuant to Section 4.01(a)(vii). Thereafter, each change in the
Applicable Rate resulting from a publicly announced change in the Debt Rating shall be effective
during the period commencing on the date of the public announcement thereof and ending on the date
immediately preceding the effective date of the next such change.




2









 








     “Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.



     “Arranger” means Banc of America Securities LLC, in its capacity as sole lead arranger
and sole book manager.



     “Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another or two or more Approved Funds managed by the same investment advisor.



     “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is required by
Section 10.06(b)), and accepted by the Administrative Agent, in substantially the form of
Exhibit D or any other form approved by the Administrative Agent.



     “Attributable Indebtedness” means, on any date, (a) in respect of any capital lease of
any Person, the capitalized amount thereof that would appear on a balance sheet of such Person
prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease
Obligation of any Person, the capitalized amount of the remaining lease payments under the relevant
lease that would appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP if such lease were accounted for as a capital lease.



     “Audited Financial Statements” means the audited consolidated balance sheet of the
Borrower and its Subsidiaries for the fiscal year ended October 31, 2007, and the related
consolidated statements of income from operations, shareholders’ equity and cash flows of the
Borrower and its Subsidiaries for such fiscal year, including the notes thereto.



     “Availability Period” means the period from and including the Closing Date to the
earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate Commitments
pursuant to Section 2.06, and (c) the date of termination of the commitment of each Lender
to make Loans pursuant to Section 8.02.



     “Bank of America” means Bank of America, N.A. and its successors.



     “Base Rate” means for any day a fluctuating rate per annum equal to the highest of
(a) the Federal Funds Rate plus 1/2 of 1%, (b) the Alternative Base Rate plus 1.00%, and (c) the
rate of interest in effect for such day as publicly announced from time to time by Bank of America
as its “prime rate.” The “prime rate” is a rate set by Bank of America based upon various factors
including Bank of America’s costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which may be priced at, above, or
below such announced rate. Any change in such rate announced by Bank of America shall take effect
at the opening of business on the day specified in the public announcement of such change.



     “Base Rate Loan” means a Loan that bears interest based on the Base Rate.



     “BBA LIBOR” means the British Bankers Association LIBOR Rate.



3









 





     “Borrower” has the meaning specified in the introductory paragraph hereto.



     “Borrower Materials” has the meaning specified in Section 6.02.



     “Borrowing” means a borrowing consisting of simultaneous Loans of the same Type made
by each of the Lenders pursuant to Section 2.01.



     “Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact closed in, the state
where the Administrative Agent’s Office is located.



     “Change in Law” means the occurrence, after the date of this Agreement, of any of the
following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change
in any law, rule, regulation or treaty or in the administration, interpretation or application
thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or
directive (whether or not having the force of law) by any Governmental Authority.



     “Change of Control” means an event or series of events by which:




     (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or
its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other
fiduciary or administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a person or
group shall be deemed to have “beneficial ownership” of all securities that such person or
group has the right to acquire whether such right is exercisable immediately or only after
the passage of time (such right, an “option right”)), directly or indirectly, of 35%
or more of the equity securities of the Borrower entitled to vote for members of the board
of directors or equivalent governing body of the Borrower on a fully-diluted basis (and
taking into account all such securities that such person or group has the right to acquire
pursuant to any option right); or




     (b) during any period of 24 consecutive months, a majority of the members of the board
of directors or other equivalent governing body of the Borrower cease to be composed of
individuals (i) who were members of that board or equivalent governing body on the first day
of such period, (ii) whose election or nomination to that board or equivalent governing body
was approved by individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing body or
(iii) whose election or nomination to that board or other equivalent governing body was
approved by individuals referred to in clauses (i) and (ii) above constituting at the time
of such election or nomination at least a majority of that board or equivalent governing
body (excluding, in the case of both clause (ii) and clause (iii), any individual whose
initial nomination for, or assumption of office as, a member of that board or equivalent
governing body occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or group other
than a solicitation for the election of one or more directors by or on behalf of the board
of directors).



4









 





     “Closing Date” means the first date all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 10.01.



     “Code” means the Internal Revenue Code of 1986.



     “Commitment” means, as to each Lender, its obligation to make Loans to the Borrower
pursuant to Section 2.01, in an aggregate principal amount at any one time outstanding not
to exceed the amount set forth opposite such Lender’s name on Schedule 2.01 or in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as
such amount may be adjusted from time to time in accordance with this Agreement.



     “Compliance Certificate” means a certificate substantially in the form of Exhibit
C.



     “Consolidated Funded Indebtedness” means, as of any date of determination, for the
Borrower and its Subsidiaries on a consolidated basis, the sum of (a) the outstanding principal
amount of all obligations, whether current or long-term, for borrowed money (including Obligations
hereunder) and all obligations evidenced by bonds, debentures, notes, loan agreements or other
similar instruments, (b) all purchase money Indebtedness, (c) all direct obligations arising under
standby letters of credit, bankers’ acceptances, bank guaranties, surety bonds and similar
instruments, (d) all obligations in respect of the deferred purchase price of property or services
(other than trade accounts payable in the ordinary course of business), (e) Attributable
Indebtedness in respect of capital leases and Synthetic Lease Obligations, (f) without duplication,
all Guarantees with respect to outstanding Indebtedness of the types specified in clauses (a)
through (e) above of Persons other than the Borrower or any Subsidiary, and (g) all Indebtedness of
the types referred to in clauses (a) through (f) above of any partnership or joint venture (other
than a joint venture that is itself a corporation or limited liability company) in which the
Borrower or a Subsidiary is a general partner or joint venturer, except to the extent such
Indebtedness is expressly made non-recourse to the Borrower or such Subsidiary.



     “Consolidated Total Assets” means, as of any date of determination, for the Borrower
and its Subsidiaries on a consolidated basis, the total assets of the Borrower and its Subsidiaries
as set forth or reflected on the most recent consolidated balance sheet of the Borrower and its
Subsidiaries, prepared in accordance with GAAP.



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



     “Control” means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through the ability to
exercise voting power, by contract or otherwise. “Controlling” and “Controlled”
have meanings correlative thereto.



     “COSO” means the Committee of Sponsoring Organizations of the Treadway Commission.



     “Credit Extension” means each Borrowing.



5









 





     “Debt Rating” has the meaning specified in the definition of “Applicable Rate.”



     “Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other
liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium,
rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the
United States or other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.



     “Default” means any event or condition that constitutes an Event of Default or that,
with the giving of any notice, the passage of time, or both, would be an Event of Default.



     “Default Rate” means an interest rate equal to (i) the Base Rate plus (ii) 2%
per annum.



     “Defaulting Lender” means any Lender that (a) has failed to fund any portion of the
Loans required to be funded by it hereunder within one Business Day of the date required to be
funded by it hereunder unless such failure has been cured, (b) has otherwise failed to pay over to
the Administrative Agent or any other Lender any other amount required to be paid by it hereunder
within one Business Day of the date when due, unless the subject of a good faith dispute or unless
such failure has been cured, or (c) has been deemed insolvent or become the subject of a bankruptcy
or insolvency proceeding.



     “Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by any Person, including
any sale, assignment, transfer or other disposal, with or without recourse, of any notes or
accounts receivable or any rights and claims associated therewith.



     “Dollar” and “$” mean lawful money of the United States.



     “Domestic Subsidiary” means any Subsidiary that is organized under the laws of any
political subdivision of the United States.



     “Eligible Assignee” means any Person that meets the requirements to be an assignee
under Section 10.06(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 10.06(b)(iii)).



     “Environmental Laws” means any and all Federal, state, local, and foreign statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or governmental restrictions relating to pollution and the
protection of the environment or the release of any materials into the environment, including those
related to hazardous substances or wastes, air emissions and discharges to waste or public systems.



     “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the
Borrower, any other Loan Party or any of their respective Subsidiaries directly or indirectly
resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use,
handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure
to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into



6









 




the environment or (e) any contract, agreement or other consensual arrangement pursuant to which
liability is assumed or imposed with respect to any of the foregoing.




     “Equity Interests” means, with respect to any Person, all of the shares of capital
stock of (or other ownership or profit interests in) such Person, all of the warrants, options or
other rights for the purchase or acquisition from such Person of shares of capital stock of (or
other ownership or profit interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person
or warrants, rights or options for the purchase or acquisition from such Person of such shares (or
such other interests), and all of the other ownership or profit interests in such Person (including
partnership, member or trust interests therein), whether voting or nonvoting, and whether or not
such shares, warrants, options, rights or other interests are outstanding on any date of
determination.



     “ERISA” means the Employee Retirement Income Security Act of 1974.



     “ERISA Affiliate” means any trade or business (whether or not incorporated) under
common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and
Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the
Code).



     “ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of
ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2)
of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e)
of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a termination under
Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Title IV of ERISA,
other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.



     “Eurodollar Reserve Percentage” means, for any day, the reserve percentage (expressed
as a decimal, carried out to five decimal places) in effect on such day, whether or not applicable
to any Lender, under regulations issued from time to time by the FRB for determining the maximum
reserve requirement (including any emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”). The
LIBOR Daily Floating Rate for each outstanding LIBOR Floating Rate Loan shall be adjusted
automatically as of the effective date of any change in the Eurodollar Reserve Percentage.



     “Event of Default” has the meaning specified in Section 8.01.



     “Excluded Taxes” means, with respect to the Administrative Agent, any Lender or any
other recipient of any payment to be made by or on account of any obligation of the Borrower



7









 




hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and
franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political
subdivision thereof) under the laws of which such recipient is organized or in which its principal
office is located or, in the case of any Lender, in which its applicable Lending Office is located,
(b) any branch profits taxes imposed by the United States or any similar tax imposed by any other
jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than
an assignee pursuant to a request by the Borrower under Section 10.13), any withholding tax
that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a
party hereto (or designates a new Lending Office) or is attributable to such Foreign Lender’s
failure or inability (other than as a result of a Change in Law) to comply with Section
3.01(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled,
at the time of designation of a new Lending Office (or assignment), to receive additional amounts
from the Borrower with respect to such withholding tax pursuant to Section 3.01(a).




     “Existing Credit Agreement” means that certain Credit Agreement dated as of April 25,
2006, among the Borrower, Bank of America, N.A., as administrative agent, swing line lender and L/C
issuer, and the lenders party thereto.



     “Federal Funds Rate” means, for any day, the 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 on such day, as published by the Federal Reserve Bank of
New York on the Business Day next succeeding such day; provided that (a) if such day is not
a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such
rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day
shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%)
charged to Bank of America on such day on such transactions as determined by the Administrative
Agent.



     “Fee Letter” means the letter agreement, dated October 9, 2008, among the Borrower,
the Administrative Agent and the Arranger.



     “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which the Borrower is resident for tax purposes. For purposes of this
definition, the United States, each State thereof and the District of Columbia shall be deemed to
constitute a single jurisdiction.



     “FRB” means the Board of Governors of the Federal Reserve System of the United States.



     “Fund” means any Person (other than a natural person) that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and similar extensions of
credit in the ordinary course of its business.



     “GAAP” means generally accepted accounting principles in the United States set forth
in the opinions and pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial Accounting



8









 




Standards Board or such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the circumstances as of the date
of determination, consistently applied.




     “Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or the European Central
Bank).



     “Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of
such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other
obligation payable or performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation, (ii) to purchase or lease property, securities or services for the purpose of
assuring the obligee in respect of such Indebtedness or other obligation of the payment or
performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of income or cash flow of
the primary obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in
respect of such Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any
assets of such Person securing any Indebtedness or other obligation of any other Person, whether or
not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or
otherwise, of any holder of such Indebtedness to obtain any such Lien); provided that, the
term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of
business. The amount of any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the related primary obligation, or portion thereof, in respect of which such
Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as
a verb has a corresponding meaning.



     “Guarantors” means, collectively, each Subsidiary of the Borrower that is a Regulated
Entity.



     “Guaranty” means that certain Guaranty Agreement executed by a Guarantor in favor of
the Administrative Agent and the Lenders, substantially in the form of Exhibit E, as
supplemented from time to time by execution and delivery of Guaranty Joinder Agreements pursuant to
Section 6.12 or otherwise.



     “Guaranty Joinder Agreement” means each Guaranty Joinder Agreement, substantially in
the form thereof attached to the Guaranty, executed and delivered by a Regulated Entity to the
Administrative Agent pursuant to Section 6.12.



9









 





     “Hazardous Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to
any Environmental Law.



     “Indebtedness” means, as to any Person at a particular time, without duplication, all
of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:




     (a) all obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;




     (b) all direct or contingent obligations of such Person arising under letters of credit
(including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and
similar instruments;




     (c) net obligations of such Person under any Swap Contract;




     (d) all obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of business);




     (e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property
owned or being purchased by such Person (including indebtedness arising under conditional
sales or other title retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse;




     (f) capital leases and Synthetic Lease Obligations;




     (g) all obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Equity Interest in such Person or any other Person,
valued, in the case of a redeemable preferred interest, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; and




     (h) all Guarantees of such Person in respect of any of the foregoing.



     For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venture (other than a joint venture that is itself a corporation or limited
liability company) in which such Person is a general partner or a joint venturer, except to the
extent such Indebtedness is expressly made non-recourse to such Person. The amount of any net
obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date. The amount of any capital lease or Synthetic Lease Obligation as of any
date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such
date.



     “Indemnified Taxes” means Taxes other than Excluded Taxes.



10









 





     “Indemnitees” has the meaning specified in Section 10.04(b).



     “Information” has the meaning specified in Section 10.07.



     “Interest Payment Date” means, as to any Loan, the first Business Day following the
end of each month and the Maturity Date.



     “Internal Control Event” means a material weakness in, or fraud that involves
management or other employees who have a significant role in, the Borrower’s internal controls over
financial reporting, in each case as described in the Securities Laws.



     “IRS” means the United States Internal Revenue Service.



     “Laws” means, collectively, all international, foreign, Federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or
judicial precedents or authorities, including the interpretation or administration thereof by any
Governmental Authority charged with the enforcement, interpretation or administration thereof, and
all applicable administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authority, in each case having the force of law.



     “Lender” has the meaning specified in the introductory paragraph hereto.



     “Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in such Lender’s Administrative Questionnaire, or such other office or offices as
a Lender may from time to time notify the Borrower and the Administrative Agent.



     “LIBOR Daily Floating Rate” means a rate per annum determined by the Administrative
Agent pursuant to the following formula:



	 	 	 	 	 
	 

	 	 	 	     LIBOR Daily Floating Base Rate
	LIBOR Daily Floating Rate

	 	=
	 	          
          
          
          
                    
	 

	 	 	 	1.00 – Eurodollar Reserve Percentage






     Where,




     “LIBOR Daily Floating Base Rate” means, for all LIBOR Floating Rate Loans, on
each day any such Loan is outstanding, the fluctuating rate of interest (rounded upwards, as
necessary, to the nearest 1/100 of 1%) equal to the BBA LIBOR, as published by Reuters (or
other commercially available source providing quotations of BBA LIBOR as designated by the
Administrative Agent from time to time) at approximately 11:00 a.m., London time, on each
day any such Loan is outstanding, for Dollar deposits with a term equivalent to a one month
interest period. If such rate is not available at such time for any reason, then the “LIBOR
Daily Floating Base Rate” shall be the rate per annum determined by the Administrative Agent
to be the rate at which deposits in Dollars for delivery in same day funds in the
approximate amount of the LIBOR Floating Rate Loan being made or converted and with a term
equivalent to a one-month interest period would be offered by Bank of America’s London
Branch to major



11









 






banks in the London interbank eurodollar market at their request at
approximately 11:00 a.m. (London time), on each day any such Loan is outstanding.



     “LIBOR Floating Rate Loan” means a Loan that bears interest at a rate based on the
LIBOR Daily Floating Rate.



     “Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge, or preference, priority or other security interest
or preferential arrangement in the nature of a security interest of any kind or nature whatsoever
(including any conditional sale or other title retention agreement, any easement, right of way or
other encumbrance on title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing).



     “Loan” has the meaning specified in Section 2.01.



     “Loan Documents” means this Agreement, each Note, the Fee Letter and the Guaranty.



     “Loan Notice” means a notice of (a) a Borrowing or (b) a conversion of Loans from one
Type to the other, pursuant to Section 2.02(a), which, if in writing, shall be
substantially in the form of Exhibit A.



     “Loan Parties” means, collectively, the Borrower and each Guarantor.



     “Margin Stock” means “margin stock” as such term is defined in Regulation T, U or X of
the FRB.



     “Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, condition (financial or otherwise) of
the Borrower and its Subsidiaries taken as a whole; (b) a material impairment of the ability of any
Loan Party to perform its obligations under any Loan Document to which it is a party; or (c) a
material adverse effect upon the legality, validity, binding effect or enforceability against any
Loan Party of any Loan Document to which it is a party.



     “Maturity Date” means March 31, 2009, or such earlier date on which the Commitment may
terminate in accordance with the terms hereof.



     “Medium Term Note Indebtedness” means all indebtedness outstanding under the Medium
Term Notes Indenture.



     “Medium Term Notes Indenture” means that certain Indenture dated as of April 1, 1993
between the Borrower and Citibank, N.A., as Trustee.



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



     “Multiemployer Plan” means any employee benefit plan of the type described in Section
4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make
contributions, or during the preceding five plan years, has made or been obligated to make
contributions.



12









 





     “Note” means a promissory note made by the Borrower in favor of a Lender evidencing
Loans made by such Lender, substantially in the form of Exhibit B.



     “Obligations” means all advances to, and debts, liabilities, obligations, covenants
and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan
or Related Credit Arrangement, whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising and including
interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate
thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.



     “Organization Documents” means, (a) with respect to any corporation, the certificate
or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents
with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the
certificate or articles of formation or organization and operating agreement; and (c) with respect
to any partnership, joint venture, trust or other form of business entity, the partnership, joint
venture or other applicable agreement of formation or organization and any agreement, instrument,
filing or notice with respect thereto filed in connection with its formation or organization with
the applicable Governmental Authority in the jurisdiction of its formation or organization and, if
applicable, any certificate or articles of formation or organization of such entity.



     “Other Taxes” means all present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies arising from any payment made hereunder or
under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with
respect to, this Agreement or any other Loan Document.



     “Outstanding Amount” means with respect to Loans on any date, the aggregate
outstanding principal amount thereof after giving effect to any borrowings and prepayments or
repayments of Loans, as the case may be, occurring on such date.



     “Participant” has the meaning specified in Section 10.06(d).



     “PBGC” means the Pension Benefit Guaranty Corporation.



     “PCAOB” means the Public Company Accounting Oversight Board.



     “Pension Plan” means any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and
is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding five plan years.



     “Person” means any natural person, corporation, limited liability company, trust,
joint venture, association, company, partnership, Governmental Authority or other entity.



13









 





     “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of
ERISA) established by the Borrower or, with respect to any such plan that is subject to Section 412
of the Code or Title IV of ERISA, any ERISA Affiliate.



     “Platform” has the meaning specified in Section 6.02.



     “Register” has the meaning specified in Section 10.06(c).



     “Registered Public Accounting Firm” has the meaning specified in the Securities Laws
and shall be independent of the Borrower as prescribed in the Securities Laws.



     “Regulated Entity” means any direct or indirect, wholly-owned Subsidiary of the
Borrower that is regulated by any state public utility commission.



     “Related Credit Arrangements” means, collectively, Related Swap Contracts and Related
Treasury Management Arrangements.



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



     “Related Swap Contract” means a Swap Contract which is entered into or maintained by
any Loan Party with a Lender or an Affiliate of a Lender.



     “Related Treasury Management Arrangement” means an arrangement for the delivery of
treasury management services to or for the benefit of any Loan Party which is entered into or
maintained with a Lender or Affiliate of a Lender and which is not prohibited by the express terms
of the Loan Documents.



     “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA,
other than events for which the 30 day notice period has been waived.



     “Request for Credit Extension” means with respect to a Borrowing or conversion of
Loans, a Loan Notice.



     “Required Lenders” means, as of any date of determination, Lenders having more than
50% of the Aggregate Commitments or, if the commitment of each Lender to make Loans has been
terminated pursuant to Section 8.02, Lenders holding in the aggregate more than 50% of the
Total Outstandings; provided that the Commitment of, and the portion of the Total
Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making
a determination of Required Lenders.



     “Responsible Officer” means the president, senior vice president, chief financial
officer, treasurer, or vice president-chief risk officer of a Loan Party and, solely for purposes
of notices given pursuant to Article II, any other officer or employee of the applicable
Loan Party so designated by any of the foregoing officers in a notice to the Administrative Agent.
Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate, partnership and/or



14









 




other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed
to have acted on behalf of such Loan Party.




     “Restricted Payment” means, with respect to any Person, any dividend or other
distribution (whether in cash, securities or other property) with respect to any Equity Interest of
such Person, or any payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such Equity Interest, or on account of any return of capital to
such Person’s stockholders, partners or members (or the equivalent Person thereof).



     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc. and any successor thereto.



     “Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002.



     “SEC” means the Securities and Exchange Commission, or any Governmental Authority
succeeding to any of its principal functions.



     “Securities Laws” means the Securities Act of 1933, the Securities Exchange Act of
1934, Sarbanes-Oxley and the applicable accounting and auditing principles, rules, standards and
practices promulgated, approved or incorporated by the SEC or the PCAOB.



     “Senior Note Agreements” means, collectively, (i) the Note Agreement dated as of July
30, 1991, and (ii) the Note Agreement dated as of September 21, 1992, for the issuance of
$35,000,000 8.51% Senior Notes due September 30, 2017.



     “Senior Note Indebtedness” means all indebtedness outstanding under the Senior Note
Agreements.



     “Shareholders’ Equity” means, as of any date of determination, consolidated
shareholders’ equity of the Borrower and its Subsidiaries as of that date determined in accordance
with GAAP.



     “Subsidiary” of a Person means a corporation, partnership, joint venture, limited
liability company or other business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other governing body (other
than securities or interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise controlled, directly,
or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise
specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary
or Subsidiaries of the Borrower.



     “Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond price or bond index
swaps or options or forward bond or forward bond price or forward bond index transactions, interest
rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap



15









 




transactions, currency options,
spot contracts, or any other similar transactions or any combination of any of the foregoing
(including any options to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions of any kind, and
the related confirmations, which are subject to the terms and conditions of, or governed by, any
form of master agreement published by the International Swaps and Derivatives Association, Inc.,
any International Foreign Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including any such
obligations or liabilities under any Master Agreement.




     “Swap Termination Value” means, in respect of any one or more Swap Contracts, after
taking into account the effect of any legally enforceable netting agreement relating to such Swap
Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Swap Contracts (which may include a
Lender or any Affiliate of a Lender).



     “Synthetic Lease Obligation” means, with respect to any Person, the monetary
obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease,
or (b) an agreement for the use or possession of property creating obligations that do not appear
on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person,
would be characterized as the indebtedness of such Person (without regard to accounting treatment).



     “Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental Authority, including
any interest, additions to tax or penalties applicable thereto.



     “Threshold Amount” means $35,000,000.



     “Total Capitalization” means, as of any date of determination, the sum of
(i) Shareholders’ Equity on such date plus (ii) Consolidated Funded Indebtedness on such date.



     “Total Outstandings” means the aggregate Outstanding Amount of all Loans.



     “Type” means, with respect to a Loan, its character as a Base Rate Loan or a LIBOR
Floating Rate Loan.



     “Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities
under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets,
determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section
412 of the Code for the applicable plan year.



     “United States” and “U.S.” mean the United States of America.



16









 





   1.02 Other Interpretive Provisions. With reference to this Agreement and each other Loan
Document, unless otherwise specified herein or in such other Loan Document:



     (a) The definitions of terms herein shall apply equally to the singular and plural forms of
the terms defined. Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words “include,” “includes” and
“including” shall be deemed to be followed by the phrase “without limitation.” The word
“will” shall be construed to have the same meaning and effect as the word “shall.”
Unless the context requires otherwise, (i) any definition of or reference to any agreement,
instrument or other document (including any Organization Document) shall be construed as referring
to such agreement, instrument or other document as from time to time amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements or modifications
set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words “herein,”
“hereof” and “hereunder,” and words of similar import when used in any Loan
Document, shall be construed to refer to such Loan Document in its entirety and not to any
particular provision thereof, (iv) all references in a Loan Document to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, the Loan Document in which such references appear, (v) any reference to any law
shall include all statutory and regulatory provisions consolidating, amending, replacing or
interpreting such law and any reference to any law or regulation shall, unless otherwise
specified, refer to such law or regulation as amended, modified or supplemented from time to time,
and (vi) 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, securities, accounts and contract rights.



     (b) In the computation of periods of time from a specified date to a later specified date,
the word “from” means “from and including;” the words “to” and
“until” each mean “to but excluding;” and the word “through” means “to
and including.”



     (c) Section headings herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any other Loan
Document.



   1.03 Accounting Terms. (a) Generally. All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all financial data (including
financial ratios and other financial calculations) required to be submitted pursuant to this
Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing the Audited Financial
Statements (except for changes concurred in by the Borrower’s independent public accountants or
otherwise required by a change in GAAP).



     (b) Changes in GAAP. If at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in any Loan Document then such computation shall
be made in accordance with GAAP as so changed unless (i) the Borrower shall have objected to
determining compliance on such basis at or prior to the time of delivery of such financial
statements, or (ii) the Required Lenders shall so object in writing within 30



17









 




days after delivery
of such financial statements, in either of which events such calculations shall be made on a basis
consistent with those used in the preparation of the latest financial statements as to which no
such objection shall have been made.




   1.04 Rounding. Any financial ratios required to be maintained by the Borrower pursuant to
this Agreement shall be calculated by dividing the appropriate component by the other component,
carrying the result to one place more than the number of places by which such ratio is expressed
herein and rounding the result up or down to the nearest number (with a rounding-up if there is no
nearest number).



   1.05 Times of Day. Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).



ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS




   2.01 Loans. Subject to the terms and conditions set forth herein, each Lender severally
agrees to make loans (each such loan, a “Loan”) to the Borrower from time to time, on any
Business Day during the Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender’s Commitment; provided, however, that after
giving effect to any Borrowing, (i) the Total Outstandings shall not exceed the Aggregate
Commitments, and (ii) the aggregate Outstanding Amount of the Loans of any Lender shall not exceed
such Lender’s Commitment. Within the limits of each Lender’s Commitment, and subject to the other
terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay under
Section 2.05, and reborrow under this Section 2.01. Loans may be Base Rate Loans
or LIBOR Floating Rate Loans, as further provided herein.



   2.02 Borrowings and Conversions of Loans.



     (a) Each Borrowing and each conversion of Loans from one Type to the other shall be made upon
the Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone.
Each such notice must be received by the Administrative Agent not later than 11:00 a.m., (i) on
the requested date of any Borrowing of LIBOR Floating Rate Loans or Base Rate Loans or (ii) on the
requested date of any conversion of (A) LIBOR Floating Rate Loans to Base Rate Loans or (B) Base
Rate Loans to LIBOR Floating Rate Loans. Each telephonic notice by the Borrower pursuant to this
Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a
written Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower.
Each Borrowing of or conversion to LIBOR Floating Rate Loans or Base Rate Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Loan Notice
(whether telephonic or written) shall specify (i) whether the Borrower is requesting a Borrowing
or a conversion of Loans from one Type to the other, (ii) the requested date of the Borrowing or
conversion, as the case may be (which shall be a Business Day), (iii) the principal amount of
Loans to be borrowed or converted, and (iv) the Type of Loans to be borrowed or to which existing
Loans are to be converted. If the Borrower fails to specify a Type of Loan in a Loan Notice, then
the applicable Loans shall be made as LIBOR Floating Rate Loans; provided that, if the
LIBOR Daily



18









 




Floating Rate is unavailable, then the applicable Loans shall be made as, or converted
to, Base Rate Loans.




     (b) Following receipt of a Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Applicable Percentage of the applicable Loans. In the case of a
Borrowing, each Lender shall make the amount of its Loan available to the Administrative Agent in
immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the
Business Day specified in the applicable Loan Notice. Upon satisfaction of the applicable
conditions set forth in Section 4.02 (and, if such Borrowing is the initial Credit
Extension, Section 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent either by (i)
crediting the account of the Borrower on the books of Bank of America with the amount of such
funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided
to (and reasonably acceptable to) the Administrative Agent by the Borrower.



     (c) At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify
the Borrower and the Lenders of any change in Bank of America’s “prime rate” used in determining
the Base Rate promptly following the public announcement of such change. The Administrative Agent
shall notify the Borrower and the Lenders of any change in the LIBOR Daily Floating Rate on the
date such change occurs.



   2.03 [Reserved].



   2.04 [Reserved].



   2.05 Prepayments.



     (a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to
time voluntarily prepay Loans in whole or in part without premium or penalty; provided
that (i) such notice must be received by the Administrative Agent not later than 11:00 a.m. on the
date of prepayment of any Loan; and (ii) any prepayment of Loans shall be in a principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof or, if less, the entire principal
amount thereof then outstanding. Each such notice shall specify the date and amount of such
prepayment and the Type(s) of Loans to be prepaid. The Administrative Agent will promptly notify
each Lender of its receipt of each such notice, and of the amount of such Lender’s Applicable
Percentage of such prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and payable on the
date specified therein. Each such prepayment shall be applied to the Loans of the Lenders in
accordance with their respective Applicable Percentages.



     (b) If for any reason the Total Outstandings at any time exceed the Aggregate Commitments
then in effect, the Borrower shall immediately prepay Loans in an aggregate amount equal to such
excess.



   2.06 Termination or Reduction of Commitments. The Borrower may, upon notice to the
Administrative Agent, terminate the Aggregate Commitments, or from time to time permanently reduce
the Aggregate Commitments; provided that (i) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. five Business Days prior to the



19









 




date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof, and (iii) the Borrower shall not terminate or
reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments
hereunder, the Total Outstandings would exceed the Aggregate Commitments. The Administrative Agent
will promptly notify the Lenders of any such notice of termination or reduction of the Aggregate
Commitments. Any reduction of the Aggregate Commitments shall be applied to the Commitment of each
Lender according to its Applicable Percentage. All fees accrued until the effective date of any
termination of the Aggregate Commitments shall be paid on the effective date of such termination.




   2.07 Repayment of Loans. The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Loans outstanding on such date.



   2.08 Interest.



     (a) Subject to the provisions of subsection (b) below, (i) each LIBOR Floating Rate Loan
shall bear interest on the outstanding principal amount thereof from the applicable borrowing date
at a rate per annum equal to the LIBOR Daily Floating Rate plus the Applicable Rate; and
(ii) each Base Rate Loan shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable
Rate.




(b) (i) If any amount of principal of any Loan is not paid when due (after giving effect to
any applicable grace periods), whether at stated maturity, by acceleration or otherwise,
such amount shall thereafter bear interest at a fluctuating interest rate per annum at all
times equal to the Default Rate to the fullest extent permitted by applicable Laws.




     (ii) If any amount (other than principal of any Loan) payable by the Borrower under any
Loan Document is not paid when due (after giving effect to any applicable grace periods),
whether at stated maturity, by acceleration or otherwise, then upon the request of the
Required Lenders, such amount shall thereafter bear interest at a fluctuating interest rate
per annum at all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.




     (iii) Accrued and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.



     (c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein. Interest hereunder shall
be due and payable in accordance with the terms hereof before and after judgment, and before and
after the commencement of any proceeding under any Debtor Relief Law.



   2.09 Fees.



     (a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a commitment fee equal



20









 




to the Applicable Rate times the actual daily amount by which the Aggregate Commitments exceed
the sum of the Outstanding Amount of Loans. The commitment fee shall accrue at all times during
the Availability Period, including at any time during which one or more of the conditions in
Article IV is not met, and shall be due and payable on the last Business Day of each
month, commencing with the first such date to occur after the Closing Date, and on the last day of
the Availability Period. The commitment fee shall be calculated monthly in arrears, and if there
is any change in the Applicable Rate during any month, the actual daily amount shall be computed
and multiplied by the Applicable Rate separately for each period during such month that such
Applicable Rate was in effect.





(b) Other Fees. (i) The Borrower shall pay to the Arranger and the Administrative
Agent for their own respective accounts fees in the amounts and at the times specified in
the Fee Letter. Such fees shall be fully earned when paid and shall not be refundable for
any reason whatsoever.




     (ii) The Borrower shall pay to the Lenders such fees as shall have been separately
agreed upon in writing in the amounts and at the times so specified. Such fees shall be
fully earned when paid and shall not be refundable for any reason whatsoever.



   2.10 Computation of Interest and Fees. All computations of interest for Base Rate Loans when
the Base Rate is determined by Bank of America’s “prime rate” shall be made on the basis of a year
of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees
and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year).
Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a
Loan, or any portion thereof, for the day on which the Loan or such portion is paid,
provided that any Loan that is repaid on the same day on which it is made shall, subject to
Section 2.12(a), bear interest for one day. Each determination by the Administrative Agent
of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent
manifest error.



21









 





   2.11 Evidence of Debt. The Credit Extensions made by each Lender shall be evidenced by one or
more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary
course of business. The accounts or records maintained by the Administrative Agent and each Lender
shall be conclusive absent manifest error of the amount of the Credit Extensions made by the
Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any
error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower
hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict
between the accounts and records maintained by any Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error. Upon the request of any Lender made through
the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the
Administrative Agent) a Note, which shall evidence such Lender’s Loans in addition to such accounts
or records. Each Lender may attach schedules to its Note and endorse thereon the date, Type (if
applicable), amount and maturity of its Loans and payments with respect thereto.



   2.12 Payments Generally; Administrative Agent’s Clawback.



     (a) General. All payments to be made by the Borrower shall be made without condition
or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly
provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent,
for the account of the respective Lenders to which such payment is owed, at the Administrative
Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date
specified herein. The Administrative Agent will promptly distribute to each Lender its Applicable
Percentage (or other applicable share as provided herein) of such payment in like funds as
received by wire transfer to such Lender’s Lending Office. All payments received by the
Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day
and any applicable interest or fee shall continue to accrue. If any payment to be made by the
Borrower shall come due on a day other than a Business Day, payment shall be made on the next
following Business Day, and such extension of time shall be reflected in computing interest or
fees, as the case may be.




(b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to 12:00 noon on the
date of any Borrowing that such Lender will not make available to the Administrative Agent
such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender
has made such share available on such date in accordance with and at the time required by
Section 2.02 and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the applicable
Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on
demand such corresponding amount in immediately available funds with interest thereon, for
each day from and including the date such amount is made available to the Borrower to but
excluding the date of payment to the Administrative Agent, at (A) in the case of a payment
to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by
the Administrative Agent in accordance with banking industry rules on interbank
compensation, plus any administrative



22









 




processing or similar fees customarily charged by the
Administrative Agent in connection with the foregoing, and (B) in the case of a payment to
be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower
and such Lender shall pay such interest to the Administrative Agent for the same or an
overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount
of such interest paid by the Borrower for such period. If such Lender pays its share of the
applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute
such Lender’s Loan included in such Borrowing. Any payment by the Borrower shall be without
prejudice to any claim the Borrower may have against a Lender that shall have failed to make
such payment to the Administrative Agent.




     (ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the date on which
any payment is due to the Administrative Agent for the account of the Lenders hereunder that
the Borrower will not make such payment, the Administrative Agent may assume that the
Borrower has made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Lenders the amount due. In such event, if the Borrower
has not in fact made such payment, then each of the Lenders severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such Lender, in
immediately available funds with interest thereon, for each day from and including the date
such amount is distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank compensation.



     A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount
owing under this subsection (b) shall be conclusive, absent manifest error.



     (c) Failure to Satisfy Conditions Precedent. If any Lender makes available to the
Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to the Borrower by
the Administrative Agent because the conditions to the applicable Credit Extension set forth in
Article IV are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall return such funds (in like funds as received from such Lender) to such
Lender, without interest.



     (d) Obligations of Lenders Several. The obligations of the Lenders hereunder to make
Loans and to make payments pursuant to Section 10.04(c) are several and not joint. The
failure of any Lender to make any Loan or to make any payment under Section 10.04(c) on
any date required hereunder shall not relieve any other Lender of its corresponding obligation to
do so on such date, and no Lender shall be responsible for the failure of any other Lender to so
make its Loan or to make its payment under Section 10.04(c).



     (e) Funding Source. Nothing herein shall be deemed to obligate any Lender to obtain
the funds for any Loan in any particular place or manner or to constitute a representation by any
Lender that it has obtained or will obtain the funds for any Loan in any particular place or
manner.



23









 





   2.13 Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff
or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of
the Loans made by it resulting in such Lender’s receiving payment of a proportion of the aggregate
amount of such Loans and accrued interest thereon greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the
Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the
Loans of the other Lenders, or make such other adjustments as shall be equitable, so that the
benefit of all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective Loans and other amounts
owing them, provided that:




     (i) if any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest; and




     (ii) the provisions of this Section shall not be construed to apply to (x) any payment
made by the Borrower pursuant to and in accordance with the express terms of this Agreement
or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans to any assignee or participant, other than to the Borrower
or any Subsidiary thereof (as to which the provisions of this Section shall apply).



     The Borrower consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against the Borrower rights of setoff and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.



ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY




   3.01 Taxes.



     (a) Payments Free of Taxes. Any and all payments by or on account of any obligation
of the Borrower hereunder or under any other Loan Document shall be made free and clear of and
without reduction or withholding for any Indemnified Taxes or Other Taxes, provided that
if the Borrower shall be required by applicable law to deduct any Indemnified Taxes (including any
Other Taxes) from such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to additional sums payable
under this Section) the Administrative Agent or Lender, 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 timely pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.



24









 





     (b) Payment of Other Taxes by the Borrower. Without limiting the provisions of
subsection (a) above, the Borrower shall timely pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.



     (c) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent and each Lender, within 10 days after demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted
on or attributable to amounts payable under this Section) paid by the Administrative Agent or such
Lender, as the case may be, and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the
Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender,
shall be conclusive absent manifest error.



     (d) Evidence of Payments. As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to
the Administrative Agent the original or a certified copy of a receipt issued by such Governmental
Authority evidencing such payment, a copy of the return reporting such payment or other evidence
of such payment reasonably satisfactory to the Administrative Agent.



     (e) Status of Lenders. Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the Borrower is resident
for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments
hereunder or under any other Loan Document shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or reasonably requested
by the Borrower or the Administrative Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without withholding or at a
reduced rate of withholding. In addition, any Lender, if requested by the Borrower or the
Administrative Agent, shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or
the Administrative Agent to determine whether or not such Lender is subject to backup withholding
or information reporting requirements.



     Without limiting the generality of the foregoing, in the event that the Borrower is resident
for tax purposes in the United States, any Foreign Lender shall deliver to the Borrower and the
Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior
to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to
time thereafter upon the request of the Borrower or the Administrative Agent, but only if such
Foreign Lender is legally entitled to do so), whichever of the following is applicable:




     (i) duly completed copies of Internal Revenue Service Form W-8BEN claiming eligibility
for benefits of an income tax treaty to which the United States is a party,




     (ii) duly completed copies of Internal Revenue Service Form W-8ECI,



25









 






     (iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate to the effect that
such Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the
Code, (B) a “10 percent shareholder” of the Borrower within the meaning of section
881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section
881(c)(3)(C) of the Code and (y) duly completed copies of Internal Revenue Service Form
W-8BEN, or



     (iv) any other form prescribed by applicable law as a basis for claiming exemption from
or a reduction in United States Federal withholding tax duly completed together with such
supplementary documentation as may be prescribed by applicable law to permit the Borrower to
determine the withholding or deduction required to be made.



     (f) Treatment of Certain Refunds. If the Administrative Agent or any Lender
determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as
to which it has been indemnified by the Borrower or with respect to which the Borrower has paid
additional amounts pursuant to this Section, it shall pay to the Borrower an amount equal to such
refund (but only to the extent of indemnity payments made, or additional amounts paid, by the
Borrower under this Section with respect to the Taxes or Other Taxes giving rise to such refund),
net of all out-of-pocket expenses of the Administrative Agent or such Lender, as the case may be,
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 Lender, 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 Lender in the event the Administrative Agent or such Lender is
required to repay such refund to such Governmental Authority. This subsection shall not be
construed to require the Administrative Agent or any Lender to make available its tax returns (or
any other information relating to its taxes that it deems confidential) to the Borrower or any
other Person.



   3.02 Illegality. If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending
Office to determine or charge interest rates based upon the LIBOR Daily Floating Rate, or any
Governmental Authority has imposed material restrictions on the authority of such Lender to
purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice
thereof by such Lender to the Borrower through the Administrative Agent, any obligation of such
Lender to make LIBOR Floating Rate Loans or to convert Base Rate Loans to LIBOR Floating Rate Loans
shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the
circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the
Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or,
if applicable, convert all applicable LIBOR Floating Rate Loans of such Lender to Base Rate Loans
immediately, if such Lender may not lawfully continue to maintain such LIBOR Floating Rate Loans.
Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount
so prepaid or converted.



   3.03 Inability to Determine Rates. If the Required Lenders determine that for any reason in
connection with any request for a LIBOR Floating Rate Loans or a conversion thereto



26









 




that (a) Dollar
deposits are not being offered to banks in the London interbank eurodollar market for the
applicable amount, (b) adequate and reasonable means do not exist for determining the LIBOR Daily
Floating Base Rate with respect to a proposed LIBOR Floating Rate Loan, or (c) the LIBOR Daily
Floating Base Rate with respect to a proposed LIBOR Floating Rate Loan does not adequately and
fairly reflect the cost to such Lenders of funding such Loan, the Administrative Agent will
promptly so notify the Borrower and each Lender. Thereafter, the obligation of Lenders to make or
maintain LIBOR Floating Rate Loans shall be suspended until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, the
Borrower may revoke any pending request for a Borrowing of or conversion to LIBOR Floating Rate
Loans or, failing that, will be deemed to have converted such request into a request for a
Borrowing of Base Rate Loans in the amount specified therein.




   3.04 Increased Costs.



     (a) Increased Costs Generally. If any Change in Law shall:




     (i) impose, modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for the account
of, or credit extended or participated in by, any Lender (except any reserve requirement
reflected in the LIBOR Daily Floating Rate);




     (ii) subject any Lender to any tax of any kind whatsoever with respect to this
Agreement or any LIBOR Floating Rate Loan made by it, or change the basis of taxation of
payments to such Lender in respect thereof (except for Indemnified Taxes or Other Taxes
covered by Section 3.01 and the imposition of, or any change in the rate of, any
Excluded Tax payable by such Lender); or




     (iii) impose on any Lender or the London interbank market any other condition, cost or
expense affecting this Agreement or LIBOR Floating Rate Loans made by such Lender;


and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any LIBOR Floating Rate Loan (or of maintaining its obligation to make any such Loan),
or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of
principal, interest or any other amount) then, upon request of such Lender, the Borrower will pay
to such Lender such additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.




     (b) Capital Requirements. If any Lender determines that any Change in Law affecting
such Lender or any Lending Office of such Lender or such Lender’s holding company, if any,
regarding capital requirements has or would have the effect of reducing the rate of return on such
Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of
this Agreement, the Commitments of such Lender or the Loans made by such Lender to a level below
that which such Lender or such Lender’s holding company could have achieved but for such Change in
Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding
company with respect to capital adequacy), then from time to time the Borrower will pay to such
Lender such additional amount or



27









 




amounts as will compensate such Lender or such Lender’s holding
company for any such reduction suffered.




     (c) Certificates for Reimbursement. A certificate of a Lender setting forth the
amount or amounts necessary to compensate such Lender or its holding company, as the case may be,
as specified in subsection (a) or (b) of this Section and delivered to the Borrower shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.



     (d) Delay in Requests. Failure or delay on the part of any Lender to demand
compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of
such Lender’s right to demand such compensation, provided that the Borrower shall not be
required to compensate a Lender pursuant to the foregoing provisions of this Section for any
increased costs incurred or reductions suffered more than nine months prior to the date that such
Lender notifies the Borrower of the Change in Law giving rise to such increased costs or
reductions and of such Lender’s intention to claim compensation therefor (except that, if the
Change in Law giving rise to such increased costs or reductions is retroactive, then the
nine-month period referred to above shall be extended to include the period of retroactive effect
thereof).



     Any Lender requesting compensation under Sections 3.01 and 3.04 hereof shall
do so within 90 days of the event giving rise to such request or otherwise lose the right to
request such compensation.



   3.05 [Reserved].



   3.06 Mitigation Obligations; Replacement of Lenders.



     (a) Designation of a Different Lending Office. If any Lender requests compensation
under Section 3.04, or the Borrower is required to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or
if any Lender gives a notice pursuant to Section 3.02, then such Lender shall use
reasonable efforts to designate a different Lending Office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in
the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable,
and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would
not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such designation or assignment.



     (b) Replacement of Lenders. If any Lender requests compensation under Section
3.04, or if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 3.01, the
Borrower may replace such Lender in accordance with Section 10.13.



   3.07 Survival. All of the Borrower’s obligations under this Article III shall survive
termination of the Aggregate Commitments and repayment of all other Obligations hereunder.



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ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS




   4.01 Conditions of Initial Credit Extension. The obligation of each Lender to make its
initial Credit Extension hereunder is subject to satisfaction of the following conditions
precedent:



     (a) The Administrative Agent’s receipt of the following, each of which shall be originals or
telecopies (followed promptly by originals) unless otherwise specified, each properly executed by
a Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of
certificates of governmental officials, a recent date before the Closing Date) and each in form
and substance satisfactory to the Administrative Agent and each of the Lenders:




     (i) executed counterparts of this Agreement and the Guaranty, sufficient in number for
distribution to the Administrative Agent, each Lender and the Borrower;




     (ii) a Note executed by the Borrower in favor of each Lender requesting a Note;




     (iii) such certificates of resolutions or other action, incumbency certificates and/or
other certificates of Responsible Officers of each Loan Party as the Administrative Agent
may require evidencing the identity, authority and capacity of each Responsible Officer
thereof authorized to act as a Responsible Officer in connection with this Agreement and the
other Loan Documents to which such Loan Party is a party;




     (iv) such documents and certifications as the Administrative Agent may reasonably
require to evidence that each Loan Party is duly organized or formed, and that each of the
Borrower and each Guarantor is validly existing, in good standing and qualified to engage in
business in each jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification, except to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect;




     (v) a favorable opinion of in-house counsel to the Borrower and Moore & Van Allen,
PLLC, counsel to the Loan Parties, addressed to the Administrative Agent and each Lender, as
to the matters set forth in Exhibit F and such other matters concerning the Loan
Parties and the Loan Documents as the Required Lenders may reasonably request;




     (vi) a certificate of a Responsible Officer of each Loan Party either (A) attaching
copies of all consents, licenses and approvals required in connection with the execution,
delivery and performance by such Loan Party and the validity against such Loan Party of the
Loan Documents to which it is a party, and such consents, licenses and approvals shall be in
full force and effect, or (B) stating that no such consents, licenses or approvals are so
required;




     (vii) a certificate signed by a Responsible Officer of the Borrower certifying (A) that
the conditions specified in Sections 4.02(a) and (b) have been satisfied,
(B) that



29









 






there has been no event or circumstance since the date of the Audited Financial
Statements that has had or could be reasonably expected to have, either individually or in
the aggregate, a Material Adverse Effect; and (C) the current Debt Ratings;




     (viii) a duly completed Compliance Certificate as of the last day of the fiscal quarter
of the Borrower ended on July 31, 2008, signed by a Responsible Officer of the Borrower;




     (ix) (A) the $50,000,000 Revolving Credit Facility dated October 27, 2008, between the
Borrower and Bank of America, N.A. and (B) the $25,000,000 Revolving Credit Facility dated
October 29, 2008, between the Borrower and Branch Banking and Trust Company have each been,
or substantially simultaneously herewith will be, terminated; and




     (x) such other assurances, certificates, documents, consents or opinions as the
Administrative Agent or the Required Lenders reasonably may require.



     (b) Any fees required to be paid by the Borrower pursuant to the Loan Documents on or before
the Closing Date shall have been paid.



     (c) Unless waived by the Administrative Agent, the Borrower shall have paid all fees, charges
and disbursements of counsel to the Administrative Agent (directly to such counsel if requested by
the Administrative Agent) to the extent invoiced prior to or on the Closing Date, plus such
additional amounts of such fees, charges and disbursements as shall constitute its reasonable
estimate of such fees, charges and disbursements incurred or to be incurred by it through the
closing proceedings (provided that such estimate shall not thereafter preclude a final settling of
accounts between the Borrower and the Administrative Agent).



     Without limiting the generality of the provisions of Section 9.04, for purposes of
determining compliance with the conditions specified in this Section 4.01, each Lender that
has signed this Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its objection thereto.



   4.02 Conditions to all Credit Extensions. The obligation of each Lender to honor any Request
for Credit Extension (other than a Loan Notice requesting only a conversion of Loans to the other
Type) is subject to the following conditions precedent:



     (a) The representations and warranties of the Borrower and each other Loan Party contained in
Article V (except for Section 5.05(c)) or any other Loan Document, or which are
contained in any document furnished at any time under or in connection herewith or therewith,
shall be true and correct on and as of the date of such Credit Extension, except to the extent
that such representations and warranties specifically refer to an earlier date, in which case they
shall be true and correct as of such earlier date, and except that for purposes of this
Section 4.02, the representations and warranties contained in subsections (a) and (b) of
Section 5.05 shall be deemed to refer to the most recent statements furnished pursuant to
clauses (a) and (b), respectively, of Section 6.01.



30









 





     (b) No Default shall exist, or would result from such proposed Credit Extension or from the
application of the proceeds thereof.



     (c) The Administrative Agent shall have received a Request for Credit Extension in accordance
with the requirements hereof.



     Each Request for Credit Extension (other than a Loan Notice requesting only a conversion of
Loans to the other Type) submitted by the Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.02(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension.



ARTICLE V.

REPRESENTATIONS AND WARRANTIES




     The Borrower represents and warrants to the Administrative Agent and the Lenders that:



     5.01 Existence, Qualification and Power. Each Loan Party (a) is (i) duly organized or formed,
validly existing and (ii), as applicable, in good standing under the Laws of the jurisdiction of
its incorporation or organization, (b) has all requisite corporate power and authority and all
requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its
assets and carry on its business and (ii) execute, deliver and perform its obligations under the
Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as
applicable, in good standing under the Laws of each jurisdiction where its ownership, lease or
operation of properties or the conduct of its business requires such qualification or license;
except in each case referred to in clauses (a)(ii), (b)(i) or (c), to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect.



     5.02 Authorization; No Contravention. The execution, delivery and performance by each Loan
Party of each Loan Document to which such Person is party, have been duly authorized by all
necessary corporate or other organizational action, and do not and will not (a) contravene the
terms of any of such Person’s Organization Documents; (b) conflict with or result in any breach or
contravention of, or the creation of any Lien under, or require any payment to be made under (i)
any Contractual Obligation to which such Person is a party or affecting such Person or the
properties of such Person or any of its Subsidiaries or (ii) any order, injunction, writ or decree
of any Governmental Authority or any arbitral award to which such Person or its property is
subject; or (c) violate any Law, except in each case referred to in clauses (b) or (c) to the
extent that such conflict, breach or violation could not reasonably be expected to have a Material
Adverse Effect.



   5.03 Governmental Authorization; Other Consents. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any Governmental Authority or any
other Person is necessary or required in connection with the execution, delivery or performance by,
or enforcement against, any Loan Party of this Agreement or any other Loan Document.



31









 





   5.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto.
This Agreement constitutes, and each other Loan Document when so delivered will constitute, a
legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is
party thereto in accordance with its terms.



   5.05 Financial Statements; No Material Adverse Effect; No Internal Control Event.



     (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii)
fairly present in all material respects the financial condition of the Borrower and its
Subsidiaries as of the date thereof and their results of operations for the period covered thereby
in accordance with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Indebtedness.



     (b) The unaudited consolidated balance sheets of the Borrower and its Subsidiaries dated July
31, 2008, and the related consolidated statements of income from operations, and cash flows for
the portion of the Borrower’s fiscal year then ended on that date (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein, and (ii) fairly present in all material respects the financial condition
of the Borrower and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of
footnotes and to normal year-end audit adjustments.



     (c) Since the date of the Audited Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could reasonably be
expected to have a Material Adverse Effect.



     (d) To the best knowledge of the Borrower, no Internal Control Event exists or has occurred
since the date of the Audited Financial Statements that has resulted in or could reasonably be
expected to result in a misstatement in any material respect, in any financial information
delivered or to be delivered to the Administrative Agent or the Lenders, of (i) covenant
compliance calculations provided hereunder or (ii) the assets, liabilities, financial condition or
results of operations of the Borrower and its Subsidiaries on a consolidated basis.



   5.06 Litigation. There are no actions, suits, proceedings, claims or disputes pending or, to
the knowledge of the Borrower after due and diligent investigation, threatened or contemplated, at
law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower or
any of its Subsidiaries or against any of their properties or revenues that (a) purport to affect
or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated
hereby, or (b) except as specifically disclosed in the Audited Financial Statements, either
individually or in the aggregate could reasonably be expected to have a Material Adverse Effect.



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   5.07 No Default. No Default has occurred and is continuing or would result from the
consummation of the transactions contemplated by this Agreement or any other Loan Document.



   5.08 Ownership of Property; Liens. Each of the Borrower and each Subsidiary has good record
and marketable title in fee simple to, or valid leasehold interests in, all real property necessary
or used in the ordinary conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The
property of the Borrower and its Subsidiaries is subject to no Liens, other than Liens permitted by
the Existing Credit Agreement.



   5.09 Environmental Compliance. The Borrower and its Subsidiaries conduct in the ordinary
course of business a review of the effect of existing Environmental Laws and claims alleging
potential liability or responsibility for violation of any Environmental Law on their respective
businesses, operations and properties, and as a result thereof the Borrower has reasonably
concluded that except as specifically disclosed in the Audited Financial Statements, such
Environmental Laws and claims could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.



   5.10 Insurance. The properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the Borrower, in such amounts
(after giving effect to any self-insurance), with such deductibles and covering such assets and
risks of the Borrower and its Subsidiaries in accordance with customary business practices in the
industry of the Borrower, as necessary and appropriate in the good faith business judgment of the
Borrower.



   5.11 Taxes. The Borrower and its Subsidiaries have filed all Federal, state and other
material tax returns and reports required to be filed, and have paid all Federal, state and other
material taxes, assessments, fees and other governmental charges levied or imposed upon them or
their properties, income or assets otherwise due and payable, except those which are being
contested in good faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed tax assessment against
the Borrower or any Subsidiary that would, if made, have a Material Adverse Effect.



   5.12 ERISA Compliance.



     (a) Each Plan is in compliance in all material respects with the applicable provisions of
ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under
Section 401(a) of the Code has received a favorable determination letter from the IRS or the
remedial amendment cycle under Revenue Procedure 2007-44 (2007-28 IRB 54) for applying for such a
letter from the IRS has not expired and, to the best knowledge of the Borrower, nothing has
occurred which would prevent, or cause the loss of, such qualification. The Borrower and each
ERISA Affiliate have made all required contributions to each Plan subject to Section 412 of the
Code, and no application for a funding waiver or an extension of any amortization period pursuant
to Section 412 of the Code has been made with respect to any Plan.



33









 





     (b) There are no pending or, to the best knowledge of the Borrower, threatened claims,
actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to any Plan that has
resulted or could reasonably be expected to result in a Material Adverse Effect.



     (c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan
has any Unfunded Pension Liability; (iii) neither the Borrower nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to
any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv)
neither the Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan; and (v) neither the Borrower nor any ERISA Affiliate has engaged in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.



   5.13 Subsidiaries; Equity Interests. As of the Closing Date, the Borrower has no Subsidiaries
other than those specifically disclosed in Part (a) of Schedule 5.13, and all of the
outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid and
nonassessable and are owned by the Borrower or a Subsidiary in the amounts specified on Part (a) of
Schedule 5.13. The Borrower has no equity investments in any other corporation or entity
other than those specifically disclosed in Part(b) of Schedule 5.13. All of the
outstanding Equity Interests in the Borrower have been validly issued and are fully paid and
nonassessable.



   5.14 Margin Regulations; Investment Company Act.



     (a) The Borrower is not engaged and will not engage, principally or as one of its important
activities, in the business of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying
margin stock. Following the application of the proceeds of each Borrowing, not more than 25% of
the value of the assets (either of the Borrower only or of the Borrower and its Subsidiaries on a
consolidated basis) subject to the provisions of Section 7.03 or subject to any
restriction contained in any agreement or instrument between the Borrower and any Lender or any
Affiliate of any Lender relating to Indebtedness and within the scope of Section 8.01(e)
will be Margin Stock.



     (b) None of the Borrower, any Person Controlling (as defined under the ICA, defined below)
the Borrower, or any Subsidiary is or is required to be registered as an “investment company”
under the Investment Company Act of 1940 (the “ICA”).



   5.15 Disclosure. The Borrower has disclosed to the Administrative Agent and the Lenders all
agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries
is subject, and all other matters known to it, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. No report, financial statement,
certificate or other information furnished (whether in writing or orally) by or on behalf of any
Loan Party to the Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder



34









 




or under any other
Loan Document (in each case, as modified or supplemented by other information so furnished)
contains any material misstatement of fact or omits to state any material fact necessary to make
the statements therein, in the light of the circumstances under which they were made, not
misleading; provided that, with respect to projected financial information, the Borrower
represents only that such information was prepared in good faith based upon assumptions believed by
the Borrower to be reasonable at the time.




   5.16 Compliance with Laws. Each Loan Party and each Subsidiary thereof is in compliance in
all material respects with the requirements of all Laws and all orders, writs, injunctions and
decrees applicable to it or to its properties, except in such instances in which (a) such
requirement of Law or order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply therewith, either
individually or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.



   5.17 Taxpayer Identification Number. The Borrower’s true and correct U.S. taxpayer
identification number is set forth on Schedule 10.02.



ARTICLE VI.

AFFIRMATIVE COVENANTS




   So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, the Borrower shall, and shall (except in the case of
the covenants set forth in Sections 6.01, 6.02, and 6.03) cause each
Guarantor to:



   6.01 Financial Statements. Deliver to the Administrative Agent with sufficient copies for
distribution to each Lender, and the Administrative Agent shall deliver such copies promptly to
each Lender after the Administrative Agent’s receipt:



     (a) as soon as available, but in any event by the date on which consolidated financial
statements for such period are required to be delivered to the SEC under the Securities Laws
(without regard to any extensions of such date permitted by the Securities Laws for which any
special application is required) (and if the Borrower does not have to deliver such consolidated
financial statements to the SEC under the Securities Laws, then as soon as available, but in any
event within 90 days after the end of the fiscal year of the Borrower), a consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of each fiscal year, and the related
consolidated statements of income from operations, shareholders’ equity and cash flows for such
fiscal year, setting forth in each case in comparative form the figures for the previous fiscal
year, all in reasonable detail and prepared in accordance with GAAP, such consolidated statements
to be audited and accompanied by (i) a report and opinion of a Registered Public Accounting Firm
of nationally recognized standing reasonably acceptable to the Required Lenders (which shall
include but not be limited to Deloitte & Touche, LLP), which report and opinion shall be prepared
in accordance with generally accepted auditing standards and applicable Securities Laws and shall
not be subject to any “going concern” or like qualification or exception or any qualification or
exception as to the scope of such audit or with respect to the absence of any material
misstatement and (ii) an attestation report of such



35









 




Registered Public Accounting Firm as to the
Borrower’s internal controls over financial reporting pursuant to Section 404 of Sarbanes-Oxley
expressing a conclusion that the Borrower has maintained effective internal controls over
financial reporting based on the COSO criteria; and




     (b) as soon as available, but in any event by the date on which consolidated financial
statements for such period are required to be delivered to the SEC under the Securities Laws
(without regard to any extensions of such date permitted by the Securities Laws for which any
special application is required) (and if the Borrower does not have to deliver such consolidated
financial statements to the SEC under the Securities Laws, then as soon as available, but in any
event within 45 days after the end of the first three fiscal quarters of each fiscal year of the
Borrower), a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of each
fiscal quarter, and the related consolidated statements of income from operations, and cash flows
for such portion of the Borrower’s fiscal year then ended and for the portion of the Borrower’s
fiscal year then ended, setting forth in each case in comparative form the figures for the
corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the
previous fiscal year, all in reasonable detail, such consolidated statements to be certified by
the chief executive officer, chief financial officer, treasurer or controller of the Borrower as
fairly presenting the financial condition, results of operations, shareholders’ equity and cash
flows of the Borrower and its Subsidiaries in accordance with GAAP, subject only to normal
year-end audit adjustments and the absence of footnotes.



   As to any information contained in materials furnished pursuant to Section 6.02(c),
the Borrower shall not be separately required to furnish such information under clause (a) or (b)
above, and to the extent that the Borrower has filed a Form 10K or Form 10Q for the respective
financial period with the SEC, it shall be deemed to have satisfied clauses (a) and (b) above.



   6.02 Certificates; Other Information. Deliver to the Administrative Agent and each Lender, in
form and detail satisfactory to the Administrative Agent and the Required Lenders:



     (a) concurrently with the delivery of the financial statements referred to in Sections
6.01(a) and (b) (commencing with the delivery of the financial statements for the
fiscal quarter ended October 31, 2008), a duly completed Compliance Certificate signed by the
chief executive officer, chief financial officer, treasurer or controller of the Borrower;



     (b) promptly after any request by the Administrative Agent or any Lender, copies of any
detailed audit reports, management letters or recommendations submitted to the board of directors
(or the audit committee of the board of directors) of the Borrower by independent accountants in
connection with the accounts or books of the Borrower or any Subsidiary, or any audit of any of
them;



     (c) promptly after the same are available, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of the Borrower, and copies of
all annual, regular, periodic and special reports and registration statements which the Borrower
may file or be required to file with the SEC under Section 13 or 15(d) of the Securities Exchange
Act of 1934, and not otherwise required to be delivered to the Administrative Agent pursuant
hereto;




36











 






          (d) promptly after the furnishing thereof, copies of any statement or report furnished to any
holder of debt securities of the Borrower or any Subsidiary thereof pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required to be furnished to the
Lenders pursuant to Section 6.01 or any other clause of this Section 6.02;




          (e) promptly, and in any event within five Business Days after receipt thereof by any Loan
Party or any Subsidiary thereof, copies of each notice or other correspondence received from the
SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or
possible investigation or other inquiry by such agency regarding financial or other operational
results of any Loan Party or any Subsidiary thereof; and




          (f) promptly, such additional information regarding the business, financial or corporate
affairs of the Borrower or any Subsidiary, or compliance with the terms of the Loan Documents, as
the Administrative Agent or any Lender may from time to time reasonably request.



          Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(c) or (d) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed
to have been delivered on the date (i) on which the Borrower posts such documents, or provides a
link thereto on the Borrower’s website on the Internet at the website address listed on
Schedule 10.02; or (ii) on which such documents are posted on the Borrower’s behalf on an
Internet or intranet website, if any, to which each Lender and the Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by the Administrative Agent);
provided that: upon the request of the Administrative Agent, (i) the Borrower shall deliver
paper copies of such documents to the Administrative Agent or any Lender that requests the Borrower
to deliver such paper copies until a written request to cease delivering paper copies is given by
the Administrative Agent or such Lender and (ii) the Borrower shall notify the Administrative Agent
and each Lender (by telecopier or electronic mail) of the posting of any such documents and provide
to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of
such documents. Except for such Compliance Certificates, the Administrative Agent shall have no
obligation to request the delivery or to maintain copies of the documents referred to above, and in
any event shall have no responsibility to monitor compliance by the Borrower with any such request
for delivery, and each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.




          The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Arranger will
make available to the Lenders materials and/or information provided by or on behalf of the Borrower
hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on
IntraLinks or another similar electronic system (the “Platform”) and (b) 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”). The Borrower
hereby agrees that (w) all Borrower Materials 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; (x) by marking Borrower Materials “PUBLIC”, the
Borrower shall be deemed to have authorized the Administrative Agent, the Arranger and the Lenders
to treat such Borrower Materials as not




37









 







containing any material non-public information with respect to the Borrower or its securities
for purposes of United States Federal and state securities laws (provided, however,
that to the extent such Borrower Materials constitute Information, they shall be treated as set
forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be
made available through a portion of the Platform designated “Public Investor”; and (z) the
Administrative Agent and the Arranger shall be entitled to treat any Borrower Materials that are
not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated
“Public Investor”. Notwithstanding the foregoing, the Borrower shall be under no obligation to
mark any Borrower Materials “PUBLIC”.




          6.03 Notices. Promptly, but in any event, within five (5) days of the Borrower becoming aware
thereof, notify the Administrative Agent and each Lender:





          (a) of the occurrence of any Default;




          (b) of any matter that has resulted or could reasonably be expected to result in a Material
Adverse Effect, including (i) any dispute, litigation, investigation, proceeding or suspension
between the Borrower or any Subsidiary and any Governmental Authority; or (ii) the commencement
of, or any material development in, any litigation or proceeding affecting the Borrower or any
Subsidiary, including pursuant to any applicable Environmental Laws;




          (c) of the occurrence of any ERISA Event;




          (d) of any material change in accounting policies or financial reporting practices by the
Borrower or any Subsidiary;




          (e) of the determination by the Registered Public Accounting Firm providing the opinion
required under Section 6.01(a)(ii) (in connection with its preparation of such opinion) or
the Borrower’s determination at any time of the occurrence or existence occurrence of any Internal
Control Event; and




          (f) of any announcement by Moody’s or S&P of any change or possible change in a Debt Rating.



          Each notice pursuant to this Section 6.03 (other than Section 6.03(f)) shall
be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein and stating what action the Borrower has taken and proposes to take
with respect thereto. Each notice pursuant to Section 6.03(a) shall describe with
particularity any and all provisions of this Agreement and any other Loan Document that have been
breached.




          6.04 Payment of Obligations. Pay and discharge as the same shall become due and payable, all
its obligations and liabilities, including all federal, state and other material tax liabilities,
assessments and governmental charges or levies upon it or its properties or assets, unless the same
are being contested in good faith by appropriate proceedings diligently conducted and adequate
reserves in accordance with GAAP are being maintained by the Borrower or such Subsidiary.




38









 








          6.05 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and
effect its legal existence under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 7.02 or 7.03; (b) preserve, renew and maintain in
full force and effect its good standing under the Laws of the jurisdiction of its origination,
except where the failure to do so could not reasonably be expected to result in a Material Adverse
Effect; (c) take all reasonable action to maintain all rights, privileges, permits, licenses and
franchises necessary or desirable in the normal conduct of its business, except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse Effect; and (d)
preserve or renew all of its registered patents, trademarks, trade names and service marks, the
non-preservation of which could reasonably be expected to have a Material Adverse Effect.




          6.06 Maintenance of Properties. Maintain, preserve and protect all of its material properties
and equipment necessary in the operation of its business in good working order and condition,
ordinary wear and tear excepted; and (b) make all necessary repairs thereto and renewals and
replacements thereof, except in the case of both (a) and (b) above, where the failure to do so
could not reasonably be expected to have a Material Adverse Effect.




          6.07 Maintenance of Insurance. Maintain insurance (including self-insurance) with respect to
its properties and business as necessary and appropriate in the customary business practice in the
industry of the Borrower.




          6.08 Compliance with Laws. Comply in all material respects with the requirements of all Laws
and all orders, writs, injunctions and decrees applicable to it or to its business or property,
except in such instances in which (a) such requirement of Law or order, writ, injunction or decree
is being contested in good faith by appropriate proceedings diligently conducted; or (b) the
failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.




          6.09 Books and Records. Maintain proper books of record and account, in which full, true and
correct entries in conformity with GAAP consistently applied shall be made of all financial
transactions and matters involving the assets and business of the Borrower or such Subsidiary, as
the case may be.




          6.10 Inspection Rights. Permit representatives and independent contractors of the
Administrative Agent and each Lender to visit and inspect any of its properties, to examine its
corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers, and independent public
accountants, all at the expense of the Administrative Agent or such Lender, as applicable, and at
such reasonable times during normal business hours and upon reasonable advance notice to the
Borrower, but not more frequently than once per every twelve (12) month period; provided,
however, that when an Event of Default exists the Administrative Agent or any Lender (or
any of their respective representatives or independent contractors) may do any of the foregoing at
the expense of the Borrower at any time during normal business hours and without advance notice as
often as may be reasonably requested.




          6.11 Use of Proceeds. Use the proceeds of the Credit Extensions for (a) general working
capital needs, capital expenditures and permitted acquisitions, (b) subject to the proviso




39









 







below, the purchase or other acquisition by the Borrower of shares of its capital stock and
related preferred stock purchase rights, and (c) other lawful corporate purposes, other than,
directly or indirectly, (i) for a purpose in contravention of any Law or of any Loan Document, (ii)
to purchase or carry Margin Stock, (iii) to repay or otherwise refinance indebtedness of the
Borrower or others incurred to purchase or carry Margin Stock, (iv) to extend credit for the
purpose of purchasing or carrying any Margin Stock, or (v) to acquire any security in any
transaction that is subject to Section 13 or 14 of the Exchange Act; provided, however,
that notwithstanding clauses (ii) through (v) above, the Borrower may use proceeds of Loans as
described in clause (b) above so long as either (x) the Margin Stock so acquired is promptly
retired following the purchase or other acquisition thereof or (y) at all times and after giving
effect to each such purchase or acquisition, not more than twenty-five percent (25%) of the total
assets of the Borrower and its Subsidiaries on a consolidated basis are represented by Margin Stock
owned by the Borrower and its Subsidiaries on a consolidated basis.




          6.12 Guarantors. Notify the Administrative Agent at the time that any Person becomes a
Regulated Entity, and promptly thereafter (and in any event within 30 days), cause such Person to





          (a) in the case of the first Regulated Entity becoming a Guarantor, a Guaranty and thereafter
for each additional Regulated Entity, a Guaranty Joinder Agreement duly executed by such Regulated
Entity;




          (b) an opinion of counsel to each Person executing the Guaranty or Guaranty Joinder Agreement
pursuant to this Section 6.12 dated as of the date of delivery of such applicable
agreements and other Loan Documents provided for in this Section 6.12 and addressed to the
Administrative Agent and the Lenders, in form and substance reasonably acceptable to the
Administrative Agent, each of which opinions may be in form and substance, including assumptions
and qualifications contained therein, substantially similar to those opinions of counsel delivered
pursuant to Section 4.01(a); and




          (c) with respect to each Person executing any Guaranty or Guaranty Joinder Agreement pursuant
to this Section 6.12, current copies of the Organization Documents of each such Person,
minutes of duly called and conducted meetings (or duly effected consent actions) of the board of
directors, partners, or appropriate committees thereof (and, if required by such Organization
Documents or applicable law, of the shareholders, members or partners) of such Person authorizing
the actions and the execution and delivery of documents described in this Section 6.12,
all certified by the applicable Governmental Authority or appropriate officer as the
Administrative Agent may elect.



     ARTICLE VII.


NEGATIVE COVENANTS



          So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, the Borrower shall not, nor shall it permit any
Guarantor to, directly or indirectly:




40









 








          7.01 [Reserved].




          7.02 Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into another
Person, or discontinue or eliminate, a line of business; provided, that so long as no
Default exists or would result therefrom:




          (a) the Borrower may merge with another Person if (i) such Person is organized under the laws
of the United States of America or one of its states, and (ii) the Borrower is the surviving
corporation; and




          (b) any Guarantor may merge with (i) the Borrower, provided that the Borrower shall
be the continuing or surviving Person, or (ii) any one or more other Guarantors.




          7.03 Change in Nature of Business. Engage in any material line of business substantially
different from those lines of business conducted by the Borrower and its Subsidiaries on the date
hereof or any business substantially related or incidental thereto.




          7.04 Transactions with Affiliates. Enter into any transaction of any kind (other than this
Agreement and any other Loan Document) with any Affiliate of the Borrower, whether or not in the
ordinary course of business, other than on fair and reasonable terms substantially as favorable to
the Borrower or such Guarantor as would be obtainable by the Borrower or such Guarantor at the time
in a comparable arm’s length transaction with a Person other than an Affiliate, provided that the
foregoing restriction shall not apply to transactions between or among the Borrower and any
Guarantor or between and among any Guarantors.




          7.05 Burdensome Agreements. Enter into any Contractual Obligation (other than this Agreement,
any other Loan Document or the Existing Credit Agreement) that (a) limits the ability (i) of any
Subsidiary to make Restricted Payments to the Borrower or any Guarantor or to otherwise transfer
property to the Borrower or any Guarantor, (ii) of any Regulated Entity to Guarantee the
Indebtedness of the Borrower or (iii) of the Borrower or any Subsidiary to create, incur, assume or
suffer to exist Liens on property of such Person except, with respect to clause (iii) above, for
(1) any document or instrument governing purchase money Indebtedness, provided that any such
restriction contained therein relates only to the asset or assets constructed or acquired in
connection therewith, (2) Medium Term Notes Indenture and the Senior Note Agreements, (3) any Lien
permitted by the Existing Credit Agreement or any document or instrument governing any such Lien,
provided that any such restriction contained therein relates only to the asset or assets
subject to such Lien, and (4) customary restrictions and conditions contained in any agreement
relating to the sale of any property permitted under Section 7.03 pending the consummation
of such sale; or (b) (except for the Medium Term Notes Indenture, the Senior Note Agreements and
any other agreement or indenture providing for the issuance of senior indebtedness on parity with
the Obligations) requires the grant of a Lien to secure an obligation of such Person if a Lien is
granted to secure another obligation of such Person.




          7.06 Ratio of Consolidated Funded Indebtedness to Total Capitalization. Permit the ratio of
Consolidated Funded Indebtedness to Total Capitalization to exceed 0.70 to 1.00 at any time.




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          7.07 Amendments to Note Agreements. Enter into or suffer to exist any amendment or
modification (a) to the amortization schedule or prepayment provisions (excluding the waiver of any
prepayment premium or penalty) of the Indebtedness created under the Medium Term Notes Indenture
and the Senior Note Agreements or (b) to any other terms or conditions contained in the Medium Term
Notes Indenture and the Senior Note Agreements if such modification (i) would conflict with or be
more restrictive than the terms or provisions of this Agreement, (ii) would provide for collateral
security for such Indebtedness in excess of that provided under such agreements as of the Closing
Date, (iii) would expand any negative pledge provision provided for therein, or (iv) would alter
any provision of the events of default under those agreements.




ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES




          8.01 Events of Default. Any of the following shall constitute an Event of Default:





          (a) Non-Payment. The Borrower or any other Loan Party fails to pay (i) when and as
required to be paid herein, any amount of principal of any Loan, or (ii) within three days after
the same becomes due, any interest on any Loan, or any fee due hereunder, or (iii) within five
days after the same becomes due, any other amount payable hereunder or under any other Loan
Document; or




          (b) Specific Covenants. The Borrower fails to perform or observe any term, covenant
or agreement contained in any of Section 6.01, 6.02 (within five days of the date
when due, in the case of Section 6.02(a)) , 6.03, 6.05(a), 6.10,
6.11 or 6.12 or Article VII, or any Guarantor fails to perform or observe
any term, covenant or agreement contained in the Guaranty; or




          (c) Other Defaults. Any Loan Party fails to perform or observe any other covenant or
agreement (not specified in subsection (a) or (b) above) contained in any Loan Document on its
part to be performed or observed and such failure continues for 30 days after the Borrower
becoming aware thereof or having received notice thereof; or




          (d) Representations and Warranties. Any representation, warranty, certification or
statement of fact made or deemed made by or on behalf of the Borrower or any other Loan Party
herein, in any other Loan Document, or in any document delivered in connection herewith or
therewith shall be incorrect or misleading when made or deemed made; or




          (e) Cross-Default. (i) Any Loan Party (A) fails to make any payment when due
(whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in
respect of the Medium Term Note Indebtedness, the Senior Notes Indebtedness or any other
Indebtedness or Guarantee (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated credit arrangement)
of more than the Threshold Amount, or (B) fails to observe or perform any other agreement or
condition relating to the Medium Term Note Indebtedness, the Senior Notes



42









 






Indebtedness or any other such Indebtedness or Guarantee or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which
default or other event is to cause, or to permit the holder or holders of such Indebtedness or the
beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed
(automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee to become payable or cash
collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Contract an
Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of default
under such Swap Contract as to which any Loan Party is the Defaulting Party (as defined in such
Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which
the Borrower or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap
Termination Value owed by the Borrower or such Subsidiary as a result thereof is greater than the
Threshold Amount;




          (f) Existing Credit Agreement. The occurrence of any Event of Default under the
Existing Credit Agreement (as such term is defined therein), regardless of whether the lenders
party to the Existing Credit Agreement waive such Event of Default thereunder; or




          (g) Insolvency Proceedings, Etc. Any Loan Party institutes or consents to the
institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit
of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for all or any material part
of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or
similar officer is appointed without the application or consent of such Person and the appointment
continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief
Law relating to any such Person or to all or any material part of its property is instituted
without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or
an order for relief is entered in any such proceeding; or




          (h) Inability to Pay Debts; Attachment. (i) Any Loan Party becomes unable or admits
in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ
or warrant of attachment or execution or similar process is issued or levied against all or any
material part of the property of any such Person and is not released, vacated or fully bonded
within 30 days after its issue or levy; or




          (i) Judgments. There is entered against any Loan Party (i) one or more final
judgments or orders for the payment of money in an aggregate amount (as to all such judgments or
orders) exceeding the Threshold Amount (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage), or (ii) any one or more non-monetary
final judgments that have, or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period of 10 consecutive
days during which a stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or



43









 






          (j) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer
Plan which has resulted or could reasonably be expected to result in liability of the Borrower
under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount
in excess of the Threshold Amount, or (ii) the Borrower or any ERISA Affiliate fails to pay when
due, after the expiration of any applicable grace period, any installment payment with respect to
its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate
amount in excess of the Threshold Amount; or




          (k) Invalidity of Loan Documents. Any Loan Document, at any time after its execution
and delivery and for any reason other than as expressly permitted hereunder or thereunder or
satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan
Party contests in any manner the validity or enforceability of any Loan Document; or any Loan
Party denies that it has any or further liability or obligation under any Loan Document, or
purports to revoke, terminate or rescind any Loan Document; or




          (l) Change of Control. There occurs any Change of Control.



          8.02 Remedies Upon Event of Default. If any Event of Default occurs and is continuing, the
Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders,
take any or all of the following actions:





          (a) declare the commitment of each Lender to make Loans to be terminated, whereupon such
commitments and obligation shall be terminated;




          (b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document
to be immediately due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Borrower; and




          (c) exercise on behalf of itself and the Lenders all rights and remedies available to it and
the Lenders under the Loan Documents;


provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the
obligation of each Lender to make Loans shall automatically terminate, and the unpaid principal
amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically
become due and payable, in each case without further act of the Administrative Agent or any Lender.




          8.03 Application of Funds. After the exercise of remedies provided for in Section
8.02 (or after the Loans have automatically become immediately due and payable as set forth in
the proviso to Section 8.02), any amounts received on account of the Obligations shall be
applied by the Administrative Agent in the following order:




          First, to payment of that portion of the Obligations constituting fees, indemnities,
expenses and other amounts (including fees, charges and disbursements of counsel to the
Administrative Agent and amounts payable under Article III) payable to the Administrative
Agent in its capacity as such;




44









 








          Second, to payment of that portion of the Obligations constituting fees, indemnities
and other amounts (other than principal and interest) payable to the Lenders (including fees,
charges and disbursements of counsel to the respective Lenders (including fees and time charges for
attorneys who may be employees of any Lender) and amounts payable under Article III),
ratably among them in proportion to the respective amounts described in this clause Second
payable to them;




          Third, to payment of that portion of the Obligations constituting accrued and unpaid
interest on the Loans and other Obligations, ratably among the Lenders in proportion to the
respective amounts described in this clause Third payable to them;




          Fourth, to payment of that portion of the Obligations constituting unpaid principal of
the Loans, ratably among the Lenders in proportion to the respective amounts described in this
clause Fourth held by them;




          Fifth, to payment of Obligations consisting of liabilities under any Related Credit
Arrangement with any Lender or any Affiliate of a Lender party to a Related Credit Arrangement and
as to which the Agent has received notice of the amounts owed thereunder from the applicable Lender
or any Affiliate of a Lender party to a Related Credit Arrangement, such payments under this clause
Fifth to be allocated on a pro rata basis according to such amounts owed as to which the
Agent has received such notice; and




          Last, the balance, if any, after all of the Obligations have been indefeasibly paid in
full, to the Borrower or as otherwise required by Law.




ARTICLE IX.

ADMINISTRATIVE AGENT




          9.01 Appointment and Authority. Each of the Lenders hereby irrevocably appoints Bank of
America to act on its behalf as the Administrative Agent hereunder and under the other Loan
Documents and authorizes the Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof,
together with such actions and powers as are reasonably incidental thereto. The provisions of this
Article are solely for the benefit of the Administrative Agent and the Lenders, and the Borrower
shall not have rights as a third party beneficiary of any of such provisions; provided, the
foregoing provisions are not intended to limit the rights granted to the Borrower under this
Article as a primary party of interest.




          9.02 Rights as a Lender. The Person serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall,
unless otherwise expressly indicated or unless the context otherwise requires, include the Person
serving as the Administrative Agent hereunder in its individual capacity. Such Person and its
Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other
advisory capacity for and generally engage in any kind of business with





45









 







the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the
Administrative Agent hereunder and without any duty to account therefor to the Lenders.




          9.03 Exculpatory Provisions. The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan Documents. Without
limiting the generality of the foregoing, the Administrative Agent:





          (a) shall not be subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing;




          (b) shall not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan
Documents that the Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided
for herein or in the other Loan Documents), provided that the Administrative Agent shall
not be required to take any action that, in its opinion or the opinion of its counsel, may expose
the Administrative Agent to liability or that is contrary to any Loan Document or applicable law;
and




          (c) shall not, except as expressly set forth herein and in the other Loan Documents, have any
duty to disclose, and shall not be liable for the failure to disclose, any information relating to
the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as
the Administrative Agent or any of its Affiliates in any capacity.



          The Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii)
in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall
be deemed not to have knowledge of any Default unless and until notice describing such Default is
given to the Administrative Agent by the Borrower or a Lender.




          The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with this Agreement or
any other Loan Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein or the
occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the Administrative Agent.




          9.04 Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely
upon, and shall not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be genuine and to
have





46









 







been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed by it to have been
made by the proper Person, and shall not incur any liability for relying thereon. In determining
compliance with any condition hereunder to the making of a Loan that by its terms must be fulfilled
to the satisfaction of a Lender, the Administrative Agent may presume that such condition is
satisfactory to such Lender unless the Administrative Agent shall have received notice to the
contrary from such Lender prior to the making of such Loan. The Administrative Agent may consult
with legal counsel (who may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.




          9.05 Delegation of Duties. The Administrative Agent may perform any and all of its duties and
exercise its rights and powers hereunder or under any other Loan Document by or through any one or
more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and powers by or through
their respective Related Parties. The exculpatory provisions of this Article shall apply to any
such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.




          9.06 Resignation of Administrative Agent. The Administrative Agent may at any time give
notice of its resignation to the Lenders and the Borrower. Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment within 30 days after the
retiring Administrative Agent gives notice of its resignation, then the retiring Administrative
Agent may on behalf of the Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative Agent shall notify the
Borrower and the Lenders that no qualifying Person has accepted such appointment, then such
resignation shall nonetheless become effective in accordance with such notice and (1) the retiring
Administrative Agent shall be discharged from its duties and obligations hereunder and under the
other Loan Documents (except that in the case of any collateral security held by the Administrative
Agent on behalf of the Lenders under any of the Loan Documents, the retiring Administrative Agent
shall continue to hold such collateral security until such time as a successor Administrative Agent
is appointed) and (2) all payments, communications and determinations provided to be made by, to or
through the Administrative Agent shall instead be made by or to each Lender directly, until such
time as the Required Lenders appoint a successor Administrative Agent as provided for above in this
Section. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers, privileges and duties
of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other Loan Documents (if
not already discharged therefrom as provided above in this Section). The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrower and such successor. After the retiring Administrative
Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article
and




47









 







Section 10.04 shall continue in effect for the benefit of such retiring Administrative
Agent, its sub-agents and their respective Related Parties in respect of any actions taken or
omitted to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.




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




          9.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of the Book
Manager or the Arranger listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents, except in its capacity,
as applicable, as the Administrative Agent or a Lender hereunder.




          9.09 Administrative Agent May File Proofs of Claim. In case of the pendency of any proceeding
under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, the
Administrative Agent (irrespective of whether the principal of any Loan shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of whether the
Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered,
by intervention in such proceeding or otherwise





          (a) to file and prove a claim for the whole amount of the principal and interest owing and
unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file
such other documents as may be necessary or advisable in order to have the claims of the Lenders
and the Administrative Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Administrative Agent and their respective agents
and counsel and all other amounts due the Lenders and the Administrative Agent under Sections
2.09 and 10.04) allowed in such judicial proceeding; and




          (b) to collect and receive any monies or other property payable or deliverable on any such
claims and to distribute the same;


and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall consent to the making of
such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its
agents and counsel, and any other amounts due the Administrative Agent under Sections 2.09
and 10.04.




48









 








          Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of any Lender to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.




          9.10 Guaranty Matters. The Lenders irrevocably authorize the Administrative Agent, at its
option and in its discretion, to release any Guarantor from its obligations under the Guaranty if
such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder.




          Upon request by the Administrative Agent at any time, the Required Lenders will confirm in
writing the Administrative Agent’s authority to release any Guarantor from its obligations under
the Guaranty pursuant to this Section 9.10.




ARTICLE X.

MISCELLANEOUS




          10.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom,
shall be effective unless in writing signed by the Required Lenders and the Borrower or the
applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each
such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment, waiver or
consent shall:





          (a) waive any condition set forth in Section 4.01(a) without the written consent of
each Lender;




          (b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated
pursuant to Section 8.02) without the written consent of such Lender;




          (c) postpone any date fixed by this Agreement or any other Loan Document for any payment of
principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under
any other Loan Document without the written consent of each Lender directly affected thereby;




          (d) reduce the principal of, or the rate of interest specified herein on, any Loan, or
(subject to clause (iv) of the second proviso to this Section 10.01) any fees or other
amounts payable hereunder or under any other Loan Document without the written consent of each
Lender directly affected thereby; provided, however, that only the consent of the
Required Lenders shall be necessary (i) to amend the definition of “Default Rate” or to waive any
obligation of the Borrower to pay interest at the Default Rate or (ii) to amend any financial
covenant hereunder (or any defined term used therein) even if the effect of such amendment would
be to reduce the rate of interest on any Loan or to reduce any fee payable hereunder;



49









 






          (e) change Section 2.13 or Section 8.03 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each Lender;




          (f) change any provision of this Section or the definition of “Required Lenders” or any other
provision hereof specifying the number or percentage of Lenders required to amend, waive or
otherwise modify any rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender; or




          (g) release all or substantially all of the value of the Guaranty without the written consent
of each Lender;


and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders required above, affect
the rights or duties of the Administrative Agent under this Agreement or any other Loan Document;
and (ii) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing
executed only by the parties thereto. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent
hereunder, except that the Commitment of such Lender may not be increased or extended without the
consent of such Lender.




          10.02 Notices; Effectiveness; Electronic Communication.





          (a) Notices Generally. Except in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in subsection (b) below), all
notices and other communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as
follows, and all notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:




          (i) if to the Borrower or the Administrative Agent, to the address, telecopier number,
electronic mail address or telephone number specified for such Person on Schedule
10.02; and




          (ii) if to any other Lender, to the address, telecopier number, electronic mail address
or telephone number specified in its Administrative Questionnaire.



          Notices sent by hand or overnight courier service, or mailed by certified or registered mail,
shall be deemed to have been given when received; notices sent by telecopier shall be deemed to
have been given when sent (except that, if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the next business day
for the recipient). Notices delivered through electronic communications to the extent provided in
subsection (b) below, shall be effective as provided in such subsection (b).





          (b) Electronic Communications. Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communication (including e-mail and Internet
or intranet websites) pursuant to procedures approved by the Administrative Agent,
provided that the foregoing shall not apply to notices to any Lender pursuant to
Article II if such Lender has notified the Administrative Agent that it is incapable of
receiving notices



50









 




under such Article by electronic communication. The Administrative Agent or the Borrower
may, in its discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it, provided that approval of
such procedures may be limited to particular notices or communications.




          Unless the Administrative Agent otherwise prescribes, (i) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement
from the intended recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement), provided that if such notice or other
communication is not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on the next business day
for the recipient, and (ii) notices or communications posted to an Internet or intranet website
shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as
described in the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.





          (c) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS
OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM
THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY
RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION
WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of
its Related Parties (collectively, the “Agent Parties”) have any liability to the
Borrower, any Lender or any other Person for losses, claims, damages, liabilities or expenses of
any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the
Administrative Agent’s transmission of Borrower Materials through the Internet, except to the
extent that such losses, claims, damages, liabilities or expenses are determined by a court of
competent jurisdiction by a final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Agent Party; provided, however, that in
no event shall any Agent Party have any liability to the Borrower, any Lender or any other Person
for indirect, special, incidental, consequential or punitive damages (as opposed to direct or
actual damages).




          (d) Change of Address, Etc. Each of the Borrower and the Administrative Agent may
change its address, telecopier or telephone number for notices and other communications hereunder
by notice to the other parties hereto. Each other Lender may change its address, telecopier or
telephone number for notices and other communications hereunder by notice to the Borrower and the
Administrative Agent. In addition, each Lender agrees to notify the Administrative Agent from
time to time to ensure that the Administrative Agent has on record (i) an effective address,
contact name, telephone number, telecopier number and electronic mail address to which notices and
other communications may be sent and (ii) accurate wire instructions for such Lender.



51









 






          (e) Reliance by Administrative Agent and Lenders. The Administrative Agent and the
Lenders shall be entitled to rely and act upon any notices (including telephonic Loan Notices)
purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a
manner specified herein, were incomplete or were not preceded or followed by any other form of
notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from
any confirmation thereof. The Borrower shall indemnify the Administrative Agent, each Lender and
the Related Parties of each of them from all losses, costs, expenses and liabilities resulting
from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower.
All telephonic notices to and other telephonic communications with the Administrative Agent may
be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such
recording.



          10.03 No Waiver; Cumulative Remedies. No failure by any Lender or the Administrative Agent to
exercise, and no delay by any such Person in exercising, 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.




          10.04 Expenses; Indemnity; Damage Waiver.





          (a) Costs and Expenses. The Borrower shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates (including the reasonable fees,
charges and disbursements of external counsel for the Administrative Agent), in connection with
the syndication of the credit facilities provided for herein, the preparation, negotiation,
execution, delivery and administration of this Agreement and the other Loan Documents or any
amendments, modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), and (ii) all reasonable
out-of-pocket expenses incurred by the Administrative Agent or any Lender (including the
reasonable fees, charges and disbursements of any external counsel for the Administrative Agent or
any Lender) in connection with the enforcement or protection of its rights (A) in connection with
this Agreement and the other Loan Documents, including its rights under this Section, or (B) in
connection with the Loans made hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans.




          (b) Indemnification by the Borrower. The Borrower shall indemnify the Administrative
Agent (and any sub-agent thereof) and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related expenses (including
the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and
hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who
may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee
by any third party or by the Borrower or any other Loan Party arising out of, in connection with,
or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of
their respective obligations



52









 






hereunder or thereunder, the consummation of the transactions contemplated hereby or thereby
or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties
only, the administration of this Agreement and the other Loan Documents, (ii) any Loan or the use
or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by the Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by the Borrower or any other Loan Party, and regardless of whether any
Indemnitee is a party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related
expenses (x) are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by the Borrower or any other Loan Party against an Indemnitee for
breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document,
if the Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction.




          (c) Reimbursement by Lenders. To the extent that the Borrower for any reason fails
to indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by
it to the Administrative Agent (or any sub-agent thereof) or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent)
or such Related Party, as the case may be, such Lender’s Applicable Percentage (determined as of
the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount, provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) in its capacity as such, or against any Related Party
of any of the foregoing acting for the Administrative Agent (or any such sub-agent) in connection
with such capacity. The obligations of the Lenders under this subsection (c) are subject to the
provisions of Section 2.12(d).




          (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable law, the Borrower shall not assert, and hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or as a result of,
this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. No
Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the
use by unintended recipients of any information or other materials distributed by such Indemnitee
through telecommunications, electronic or other information transmission systems in connection
with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby
other than for direct or actual damages resulting from the gross negligence of willful misconduct
of such Indemnitee as determined by a final and nonappealable judgment of a court of competent
jurisdiction.




          (e) Payments. All amounts due under this Section shall be payable not later than ten
Business Days after demand therefor.



53









 






          (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent, the replacement of any Lender, the termination of the Aggregate Commitments
and the repayment, satisfaction or discharge of all the other Obligations.



          10.05 Payments Set Aside. To the extent that any payment by or on behalf of the Borrower is
made to the Administrative Agent or any Lender, or the Administrative Agent or any Lender exercises
its right of setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent or such Lender in
its discretion) to be repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such setoff had not occurred, and
(b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable
share (without duplication) of any amount so recovered from or repaid by the Administrative Agent,
plus interest thereon from the date of such demand to the date such payment is made at a rate per
annum equal to the Federal Funds Rate from time to time in effect. The obligations of the Lenders
under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and
the termination of this Agreement.




          10.06 Successors and Assigns.





          (a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an assignee in accordance with the provisions of subsection (b) of this
Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this
Section, or (iii) by way of pledge or assignment of a security interest subject to the
restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by
any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall
be construed to confer upon any Person (other than the parties hereto, their respective successors
and assigns permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.




          (b) Assignments by Lenders. Any Lender may at any time assign to one or more
Eligible Assignees all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it); provided that
any such assignment shall be subject to the following conditions:




          (i) Minimum Amounts.




          (A) in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in the



54









 






case of an assignment to a Lender, an affiliate of a Lender or an Approved
Fund, no minimum amount need be assigned; and




     (B) in any case not described in subsection (b)(i)(A) of this Section, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the principal
outstanding balance of the Loans of the assigning Lender subject to each such
assignment, determined as of the date the Assignment and Assumption with respect to
such assignment is delivered to the Administrative Agent or, if “Trade Date” is
specified in the Assignment and Assumption, as of the Trade Date, shall not be less
than $5,000,000 unless each of the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed); provided,
however, that concurrent assignments to members of an Assignee Group and
concurrent assignments from members of an Assignee Group to a single assignee (or to
an assignee and members of its Assignee Group) will be treated as a single
assignment for purposes of determining whether such minimum amount has been met.




          (ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loans or the Commitment assigned.




          (iii) Required Consents. No consent shall be required for any assignment
except to the extent required by subsection (b)(i)(B) of this Section and, in addition:




          (A) the consent of the Borrower (such consent not to be unreasonably withheld
or delayed, it being deemed reasonable on the part of the Borrower to withhold
consent to any assignment that would cause the Borrower to incur additional costs
under Section 3.01(a)) shall be required unless (1) an Event of Default has
occurred and is continuing at the time of such assignment or (2) such assignment is
to a Lender, an Affiliate of a Lender or an Approved Fund; and




          (B) the consent of the Administrative Agent (such consent not to be
unreasonably withheld or delayed) shall be required if such assignment is to be a
Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with
respect to such Lender.




     (iv) Assignment and Assumption. The parties to each assignment shall execute
and deliver to the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee in the amount, if any, required as set forth in Schedule
10.06; provided, however, that the Administrative Agent may, in its sole
discretion, elect to waive such processing and recordation fee in the case of any
assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent
an Administrative Questionnaire.



55









 






          (v) No Assignment to Borrower. No such assignment shall be made to the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.




          (vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.



          Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection
(c) of this Section, from and after the effective date specified in each Assignment and Assumption,
the assignee thereunder shall be a party to this Agreement and, to the extent of the interest
assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be
entitled to the benefits of Sections 3.01, 3.04, and 10.04 with respect to
facts and circumstances occurring prior to the effective date of such assignment. Upon request,
the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any
assignment or transfer by a Lender of rights or obligations under this Agreement that does not
comply with this subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with subsection (d) of this
Section.





          (c) Register. The Administrative Agent, acting solely for this purpose as an agent
of the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and addresses of the
Lenders, and the Commitments of, and principal amounts of the Loans owing to, each Lender pursuant
to the terms hereof from time to time (the “Register”). The entries in the Register shall
be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time and from time to
time upon reasonable prior notice.




          (d) Participations. Any Lender may at any time, without the consent of, or notice
to, the Borrower or the Administrative Agent, sell participations to any Person (other than a
natural person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans owing to it);
provided that (i) such Lender’s obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for the performance
of such obligations and (iii) the Borrower, the Administrative Agent and the Lenders shall
continue to deal solely and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.



          Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such





56









 









agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in the first proviso to
Section 10.01 that affects such Participant. Subject to subsection (e) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of Sections
3.01 and 3.04 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to subsection (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.08 as though it were a
Lender, provided such Participant agrees to be subject to Section 2.13 as though it
were a Lender.




          (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable Lender
would have been entitled to receive with respect to the participation sold to such Participant. A
Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 3.01 unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to comply with
Section 3.01(e) as though it were a Lender.




          (f) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its Note, if any) to
secure obligations of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender
from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.




          (g) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be deemed to include
electronic signatures or the keeping of records in electronic form, each of which shall be of the
same legal effect, validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as provided for in any
applicable law, including the Federal Electronic Signatures in Global and National Commerce Act,
the New York State Electronic Signatures and Records Act, or any other similar state laws based on
the Uniform Electronic Transactions Act.



          10.07 Treatment of Certain Information; Confidentiality. Each of the Administrative Agent and
the Lenders agrees to maintain the confidentiality of the Information (as defined below), except
that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective
partners, directors, officers, employees, agents, advisors and representatives (it being understood
that the Persons to whom such disclosure is made will be informed of the confidential nature of
such Information and instructed to keep such Information confidential), (b) to the extent requested
by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to the extent required
by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other
party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or





57









 







Participant in, any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction relating to the
Borrower and its obligations, (g) with the consent of the Borrower or (h) to the extent such
Information (x) becomes publicly available other than as a result of a breach of this Section or
(y) becomes available to the Administrative Agent and any Lender or any of their respective
Affiliates on a nonconfidential basis from a source other than the Borrower.




          For purposes of this Section, “Information” means all information received from the
Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of their respective
businesses, other than any such information that is available to the Administrative Agent or any
Lender on a nonconfidential basis prior to disclosure by the Borrower or any Subsidiary,
provided that, in the case of information received from the Borrower or any Subsidiary
after the date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.




          Each of the Administrative Agent and the Lenders acknowledges that (a) the Information may
include material non-public information concerning the Borrower or a Subsidiary, as the case may
be, (b) it has developed compliance procedures regarding the use of material non-public information
and (c) it will handle such material non-public information in accordance with applicable Law,
including Federal and state securities Laws.




          10.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each
Lender and each of its respective Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final, in whatever currency) at any time held
and other obligations (in whatever currency) at any time owing by such Lender or any such Affiliate
to or for the credit or the account of the Borrower against any and all of the obligations of the
Borrower now or hereafter existing under this Agreement or any other Loan Document to such Lender,
irrespective of whether or not such Lender shall have made any demand under this Agreement or any
other Loan Document and although such obligations of the Borrower may be contingent or unmatured or
are owed to a branch or office of such Lender different from the branch or office holding such
deposit or obligated on such indebtedness. The rights of each Lender and its respective Affiliates
under this Section are in addition to other rights and remedies (including other rights of setoff)
that such Lender or its respective Affiliates may have. Each Lender agrees to notify the Borrower
and the Administrative Agent promptly after any such setoff and application, provided that
the failure to give such notice shall not affect the validity of such setoff and application.




          10.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any
Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If
the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. In determining whether the





58









 







interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds
the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any
payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude
voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated term of the
Obligations hereunder.




          10.10 Counterparts; Integration; Effectiveness. This Agreement and the other Loan Documents
may be executed in counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together shall constitute a
single contract. This Agreement and the other Loan Documents constitute the entire contract among
the parties relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement and the other Loan Documents shall become effective when they
shall have been executed by the Administrative Agent and when the Administrative Agent shall have
received counterparts hereof that, when taken together, bear the signatures of each of the other
parties hereto. Delivery of an executed counterpart of a signature page of this Agreement and any
other Loan Document by telecopy shall be effective as delivery of a manually executed counterpart
of this Agreement and the other Loan Documents.




          10.11 Survival of Representations and Warranties. All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or
in connection herewith or therewith shall survive the execution and delivery hereof and thereof.
Such representations and warranties have been or will be relied upon by the Administrative Agent
and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or
on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default at the time of any Credit Extension, and shall continue in full force
and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or
unsatisfied.




          10.12 Severability. If any provision of this Agreement or the other Loan Documents is held to
be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the
remaining provisions of this Agreement and the other Loan Documents shall not be affected or
impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the
illegal, invalid or unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable provisions. The
invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction.




          10.13 Replacement of Lenders. If any Lender requests compensation under Section 3.04,
or if the Borrower is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 3.01, if any Lender is a
Defaulting Lender, or if any Lender is a Restricted Lender (as defined below) then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 10.06), all of its interests,
rights and obligations under this Agreement and the related Loan Documents to an





59









 







assignee that shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment), provided that:





          (a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in
Section 10.06(b);




          (b) such Lender shall have received payment of an amount equal to the outstanding principal
of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder
and under the other Loan Documents from the assignee (to the extent of such outstanding principal
and accrued interest and fees) or the Borrower (in the case of all other amounts);




          (c) in the case of any such assignment resulting from a claim for compensation under
Section 3.04 or payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments thereafter;




          (d) in the case of any such assignment by a Restricted Lender, the assignee must have
approved in writing the substance of the amendment, waiver or consent which caused the assignor to
be a Restricted Lender; and




          (e) such assignment does not conflict with applicable Laws.



          A Lender shall not be required to make any such assignment or delegation if, prior thereto, as
a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.




          For the purposes of this Section 10.13, a “Restricted Lender” means a Lender
that fails to approve an amendment, waiver or consent requested by the Loan Parties pursuant to
Section 10.01 that has received the written approval of not less than the Required Lenders
but also requires the approval of such Lender.




          10.14 Governing Law; Jurisdiction; Etc.





          (a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NORTH CAROLINA.




          (b) SUBMISSION TO JURISDICTION. EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NORTH CAROLINA SITTING IN MECKLENBURG COUNTY AND OF THE UNITED STATES
DISTRICT COURT OF THE WESTERN DISTRICT OF NORTH CAROLINA, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING
MAY BE HEARD AND DETERMINED IN SUCH NORTH



60









 






CAROLINA STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL
COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING
SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL
AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR
ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.




          (c) WAIVER OF VENUE. EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS
SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.




          (d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS
IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL
AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE
LAW.



          10.15 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE
OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.




          10.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of each
transaction contemplated hereby, the Borrower acknowledges and agrees that: (i) the credit
facility provided for hereunder and any related arranging or other services in connection therewith
(including in connection with any amendment, waiver or other modification hereof or of any other
Loan Document) are an arm’s-length commercial transaction between the Borrower





61









 







and its Affiliates, on the one hand, and the Administrative Agent and the Arranger, on the
other hand, the Borrower is capable of evaluating and understanding and understands and accepts the
terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents
(including any amendment, waiver or other modification thereof or thereof); (ii) in connection with
the process leading to such transaction, the Administrative Agent and the Arranger each is and has
been acting solely as a principal and is not the financial advisor, agent or fiduciary, for the
Borrower or any of its Affiliates, stockholders, creditors or employees or any other Person; (iii)
neither the Administrative Agent nor the Arranger has assumed or will assume an advisory, agency or
fiduciary responsibility in favor of the Borrower with respect to any of the transactions
contemplated hereby or the process leading thereto, including with respect to any amendment, waiver
or other modification hereof or of any other Loan Document (irrespective of whether the
Administrative Agent or the Arranger has advised or is currently advising the Borrower or any of
its Affiliates on other matters) and neither the Administrative Agent nor Arranger has any
obligation to the Borrower or any of its Affiliates with respect to the transactions contemplated
hereby except those obligations expressly set forth herein and in the other Loan Documents; (iv)
the Administrative Agent and the Arranger and their respective Affiliates may be engaged in a board
range of transactions that involve interests that differ from those of the Borrower and its
Affiliates, and neither the Administrative Agent nor the Arranger has any obligation to disclose
any of such interests by virtue of any advisory, agency or fiduciary relationship; and (v) the
Administrative Agent and the Arranger have not provided and will not provide any legal, accounting,
regulatory or tax advice with respect to any of the transactions contemplated hereby (including any
amendment, waiver or other modification hereof or of any other Loan Document) and the Borrower has
consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed
appropriate. The Borrower hereby waives and releases, to the fullest extent permitted by law, any
claims that it may have against the Administrative Agent and the Arranger with respect to any
breach or alleged breach of agency or fiduciary duty.




          10.17 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as hereinafter defined)
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 “Act”), it is required to obtain, verify and
record information that identifies the Borrower, which information includes the name and address of
the Borrower and other information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Borrower in accordance with the Act.




62









 





          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.




	 	 	 	 	 	 	 
	 	 	PIEDMONT NATURAL GAS COMPANY, INC.	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ ROBERT O. PRITCHARD	 	 
	 

	 	Name:
	 	Robert O. Pritchard	 	 
	 

	 	Title:
	 	Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as
Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ KRISTINE THENNES	 	 
	 

	 	Name:
	 	Kristine Thennes	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as a Lender	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ SCOTT K. MITCHELL	 	 
	 

	 	Name:
	 	Scott K. Mitchell	 	 
	 

	 	Title:
	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	REGIONS BANK	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ ANTHONY LETRENT	 	 
	 

	 	Name:
	 	Anthony LeTrent	 	 
	 

	 	Title:
	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BRANCH BANKING AND TRUST COMPANY	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ H. WRIGHT UZZELL, JR.	 	 
	 

	 	Name:
	 	H. Wright Uzzell, Jr.	 	 
	 

	 	Title:
	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ FELICIA LA FORGIA	 	 
	 

	 	Name:
	 	Felicia La Forgia	 	 
	 

	 	Title:
	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	CAROLINA FIRST BANK	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ C. KEMP SIMMONS	 	 
	 

	 	Name:
	 	C. Kemp Simmons	 	 






Piedmont Natural Gas Company, Inc.

Credit Agreement

Signature Page





 









 








	 	 	 	 	 	 	 
	 

	 	Title:
	 	 Senior Vice President
	 	 
	 
	 	 	 	 	 	 
	 	 	FIFTH THIRD BANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 	 	By: /s/ DAVID C. HOUSTON	 	 
	 

	 	Name:
	 	David C. Houston	 	 
	 

	 	Title:
	 	 Vice President	 	 






Piedmont Natural Gas Company, Inc.

Credit Agreement

Signature Page





 












 





SCHEDULE 2.01




COMMITMENTS AND

APPLICABLE PERCENTAGES




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Applicable	 
	Lender	 	Commitment	 	 	Percentage	 
	Bank of America, N.A.
	 	$	25,000,000.00	 	 	 	16.666666667	%
	Regions Bank
	 	 	25,000,000.00	 	 	 	16.666666667	%
	Branch Banking and Trust Company
	 	 	25,000,000.00	 	 	 	16.666666667	%
	U.S. Bank National Association
	 	 	25,000,000.00	 	 	 	16.666666667	%
	Carolina First Bank
	 	 	25,000,000.00	 	 	 	16.666666666	%
	Fifth Third Bank, N.A.
	 	 	25,000,000.00	 	 	 	16.666666666	%
	 
	 	 	 	 	 	 
	Total
	 	$	150,000,000.00	 	 	 	100.000000000	%
	 
	 	 	 	 	 	 






S-1









 






SCHEDULE 5.13




SUBSIDIARIES AND

OTHER EQUITY INVESTMENTS




Part (a). Subsidiaries.




(i) Direct Subsidiaries



Piedmont Energy Partners, Inc.

Piedmont Hardy Storage Company, LLC

Piedmont ENCNG Company, LLC



(ii) Indirect Subsidiaries



Piedmont Energy Company

Piedmont Interstate Pipeline Company

Piedmont Intrastate Pipeline Company

Piedmont Propane Company



Part (b). Other Equity Investments.



SouthStar Energy Services, LLC

Pine Needle LNG Company, LLC

Cardinal Pipeline Company, LLC

Hardy Storage Company, LLC



S-2









 








SCHEDULE 10.02




ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES




BORROWER:




Primary Contact




PIEDMONT NATURAL GAS COMPANY, INC.

Office of the Treasurer

4720 Piedmont Row Drive

Charlotte, North Carolina 28210

Attention: Robert Pritchard

Telephone: 704.731.4332

Telecopier: 704.731.4097

e-mail: rob.pritchard@piedmontng.com

website address: www.piedmontng.com/

U.S. Taxpayer Identification Number: 56-0556998




Secondary




PIEDMONT NATURAL GAS COMPANY, INC.

Office of General Council

4720 Piedmont Row Drive

Charlotte, North Carolina 28210

Attention: Judy Z. Mayo

Telephone: 704.731.4308

Telecopier: 704.365.8515

e-mail: judy.mayo@piedmontng.com

website address: www.piedmontng.com/

U.S. Taxpayer Identification Number: 56-0556998




ADMINISTRATIVE AGENT:




BANK OF AMERICA, N.A.




Your contacts in Agency Servicing:




	 	 	 	 	 
	Primary	 	Kathy S. Mumpower
	 	 	AVP; Client Service Representative
	 

	 	Telephone: (704) 386-0482

	 

	 	Fax: (704) 409-0070

	 

	 	Address: 101 North Tryon Street

	 

	 	                  Mail Code NC1-001-04-39
	 

	 	                  Charlotte, North Carolina 28255-0001






S-3









 






	 	 	 	 	 

	Secondary

	 	Lynne Cole	 	 
	 	 	AVP; Client Service Representative
	 

	 	Telephone: (704) 387-3614

	 

	 	Fax: (704) 409-0003

	 

	 	Address: 101 North Tryon Street

	 

	 	                  Mail Code NC1-001-04-39
	 

	 	                  Charlotte, North Carolina 28255-0001
	 
	 	 	 	 
	Wire Instructions:	 	Bank of America, N.A.
               ABA #: 026-009-593
	 

	 	New York, NY
	 	               Acct.#: 136-621-225-0600
	 

	 	 	 	               Attn:Credit Services
	 

	 	 	 	               Ref: Piedmont Natural Gas Company, Inc.
	 
	 	 	 	 
	Your contacts in Agency Management:	 	 
	Primary

	 	Laura Call
	 	               (financial reporting requirements, bank group communications)
	 

	 	Agency Officer
	 	               
	 	 	Bank of America, N.A.
	 	 	Mail Code: IL1-231-08-30
	 	 	231 South LaSalle Street
	 	 	Chicago, Illinois 60604
	 

	 	Telephone: (312) 828-3559

	 

	 	Fax: (877) 207-2883

	 	 	Email: laura.call@bankofamerica.com
	 
	 	 	 	 
	Secondary

	 	Felicia Brinson	 	 
	 

	 	Agency Officer	 	 
	 	 	Bank of America, N.A.
	 	 	Mail Code: IL1-231-08-30
	 	 	231 South LaSalle Street
	 	 	Chicago, Illinois 60604
	 

	 	Telephone: (312) 828-7299

	 

	 	Fax: (877) 216-2432

	 	 	Email: felicia.brinson@bankofamerica.com






S-4









 





SCHEDULE 10.06




PROCESSING AND RECORDATION FEES




The Administrative Agent will charge a processing and recordation fee (an “Assignment Fee”)
in the amount of $2,500 for each assignment; provided, however, that in the event
of two or more concurrent assignments to members of the same Assignee Group (which may be effected
by a suballocation of an assigned amount among members of such Assignee Group) or two or more
concurrent assignments by members of the same Assignee Group to a single Eligible Assignee (or to
an Eligible Assignee and members of its Assignee Group), the Assignment Fee will be $2,500 plus the
amount set forth below:




	 	 	 	 	 
	Transaction	 	Assignment Fee
	First four concurrent assignments or suballocations to
members of an Assignee Group (or from members of an
Assignee Group, as applicable)

	 	 	-0-	 
	 
	 	 	 	 
	Each additional concurrent assignment or suballocation to a
member of such Assignee Group (or from a member of such
Assignee Group, as applicable)

	 	$	500	 







S-5











 





EXHIBIT A




FORM OF LOAN NOTICE




Date: ___________, _____




To: Bank of America, N.A., as Administrative Agent




Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement, dated as of December 3, 2008 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms defined therein being used herein as therein defined), among
PIEDMONT NATURAL GAS COMPANY, INC., a North Carolina corporation (the “Borrower”), the
Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.



     The undersigned hereby requests (select one):



     o A Borrowing of Loans                      o A conversion of Loans



	 	 	 	 	 	 	 

	 

	 	 	1.	 	 	On _________________________ (a Business Day).
	 
	 	 	 	 	 	 
	 

	 	 	2.	 	 	In the amount of $______________.
	 
	 	 	 	 	 	 
	 

	 	 	3.	 	 	Comprised of _____________________________.
	 

	 	 	 	 	 	                         [Type of Loan requested]
	 
	 	 	 	 	 	 
	 

	 	 	4.	 	 	For Eurodollar Rate Loans: with an Interest Period of ____________ months.






     The Borrowing, if any, requested herein complies with the provisos to the first sentence of
Section 2.01 of the Agreement.



	 	 	 	 	 
	 	PIEDMONT NATURAL GAS COMPANY, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Form of Loan Notice






A-1









 








EXHIBIT B




FORM OF NOTE




December 3, 2008





     FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to
_____________________ or registered assigns (the “Lender”), in accordance with the
provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time
to time made by the Lender to the Borrower under that certain Credit Agreement, dated as of
December 3, 2008 (as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement;” the terms defined therein being used herein as therein
defined), among the Borrower, the Lenders from time to time party thereto, and Bank of America,
N.A., as Administrative Agent.



     The Borrower promises to pay interest on the unpaid principal amount of each Loan from the
date of such Loan until such principal amount is paid in full, at such interest rates and at such
times as provided in the Agreement. All payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in Dollars in immediately available funds at the
Administrative Agent’s Office. If any amount is not paid in full when due hereunder, such unpaid
amount shall bear interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per annum rate set forth in
the Agreement.



     This Note is one of the Notes referred to in the Agreement, is entitled to the benefits
thereof and may be prepaid in whole or in part subject to the terms and conditions provided
therein. This Note is also entitled to the benefits of the Guaranty. Upon the occurrence and
continuation of one or more of the Events of Default specified in the Agreement, all amounts then
remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable
all as provided in the Agreement. Loans made by the Lender shall be evidenced by one or more loan
accounts or records maintained by the Lender in the ordinary course of business. The Lender may
also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans
and payments with respect thereto.



     The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment,
protest and demand and notice of protest, demand, dishonor and non-payment of this Note.



Form of Note




B-1









 








     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NORTH CAROLINA.



	 	 	 	 	 
	 	PIEDMONT NATURAL GAS COMPANY, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Form of Note









B-2









 








LOANS AND PAYMENTS WITH RESPECT THERETO




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Amount of	 	 	 	 
	 	 	 	 	 	 	 	 	Principal or	 	Outstanding	 	 
	 	 	 	 	 	 	End of	 	Interest	 	Principal	 	 
	 	 	Type of	 	Amount of	 	Interest	 	Paid This	 	Balance	 	Notation
	Date	 	Loan Made	 	Loan Made	 	Period	 	Date	 	This Date	 	Made By
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 





Form of Note







B-3









 








EXHIBIT C




FORM OF COMPLIANCE CERTIFICATE




Financial Statement Date: __________, _____




To: Bank of America, N.A., as Administrative Agent




Ladies and Gentlemen:




     Reference is made to that certain Credit Agreement, dated as of December 3, 2008 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms defined therein being used herein as therein defined), among
PIEDMONT NATURAL GAS COMPANY, INC., a North Carolina corporation (the “Borrower”), the
Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.



     The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the                                         
of the Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to
the Administrative Agent on the behalf of the Borrower, and that:



[Use following paragraph 1 for fiscal year-end financial statements; provided, if the
applicable Form 10K has been filed with the SEC, no such attachment or certification is necessary
and paragraph 1 may be omitted]




     1. Attached hereto as Schedule 1 are the year-end audited financial statements
required by Section 6.01(a) of the Agreement for the fiscal year of the Borrower ended as
of the above date, together with the report and opinion of an independent certified public
accountant required by such section.



[Use following paragraph 1 for fiscal quarter-end financial statements; provided, if the
applicable Form 10Q has been filed with the SEC, (a) no such attachment or certification is
necessary, (b) the first sentence of paragraph 1 may be omitted and (c) the second sentence with
the bracketed language shall be utilized as paragraph 1]




     1. Attached hereto as Schedule 1 are the unaudited financial statements required by
Section 6.01(b) of the Agreement for the fiscal quarter of the Borrower ended as of the
above date. Such financial statements [contained in the Form 10Q most recently filed with the SEC]
fairly present the financial condition, results of operations and cash flows of the Borrower and
its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to
normal year-end audit adjustments and the absence of footnotes.



     2. The undersigned has reviewed and is familiar with the terms of the Agreement and has made,
or has caused to be made under his/her supervision, a detailed review of the transactions and
condition (financial or otherwise) of the Borrower during the accounting period covered by the
attached financial statements.



Form of Compliance Certificate





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     3. A review of the activities of the Borrower during such fiscal period has been made under
the supervision of the undersigned with a view to determining whether during such fiscal period the
Borrower performed and observed all its Obligations under the Loan Documents, and



[select one:]




     [to the best knowledge of the undersigned during such fiscal period, the Borrower performed
and observed each covenant and condition of the Loan Documents applicable to it, and no Default has
occurred and is continuing.]



—or—




     [to the best knowledge of the undersigned during such fiscal period, the following covenants
or conditions have not been performed or observed and the following is a list of each such Default
and its nature and status:]



     4. The representations and warranties of the Borrower contained in Article V (except
Section 5.05(c)) of the Agreement, and any representations and warranties of the Borrower
that are contained in any document furnished at any time under or in connection with the Loan
Documents, are true and correct on and as of the date hereof, except to the extent that such
representations and warranties specifically refer to an earlier date, in which case they are true
and correct as of such earlier date, and except that for purposes of this Compliance Certificate,
the representations and warranties contained in subsections (a) and (b) of Section 5.05 of
the Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses
(a) and (b), respectively, of Section 6.01 of the Agreement, including the statements in
connection with which this Compliance Certificate is delivered.



     5. The financial covenant analyses and information set forth on Schedules 2 and
3 attached hereto are true and accurate on and as of the date of this Certificate.



     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of _______________, ____.



	 	 	 	 	 
	 	PIEDMONT NATURAL GAS COMPANY, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Form of Compliance Certificate







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For the
Quarter/Year ended __________________ (“Statement Date”)




SCHEDULE 2

to the Compliance Certificate

($ in 000’s)




I. Section 7.06 — Ratio of Consolidated Funded Indebtedness to Total Capitalization.




	 	 	 	 	 	 	 	 	 	 	 

	 	A.	 	 	 	 	Consolidated Funded Indebtedness at Statement Date:

	$	 
	 	 	 	 	 	 	 
	 	 	 	 
	 	B.	 	 	 	 	Total Capitalization at Statement Date:
	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 
	 	 	 	 	 	 	1. Shareholders’ Equity:

	$	 
	 	 	 	 	 	 	 
	 	 	 	 
	 	 	 	 	 	 	2. Consolidated Funded Indebtedness:

	$	 
	 	 	 	 	 	 	 
	 	 	 	 
	 	 	 	 	 	 	3. Total Capitalization (Line I.B.1 plus Line I.B.2):

	$	 
	 	 	 	 	 	 	 
	 	 	 	 
	 	C.	 	 	 	 	Ratio of Consolidated Funded Indebtedness to Total Capitalization (Line I.A ÷ Line I.B.3):

	 	                     to 1

	 	 	 	 	 	 	 
	 	 	 	 
	 	 	 	 	 	 	Maximum permitted:

	 	0.70 to 1.00







Form of Compliance Certificate





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EXHIBIT D




ASSIGNMENT AND ASSUMPTION




     This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the
Effective Date set forth below and is entered into by and between [the][each] Assignor identified
in item 1 below ([the][each, an] “Assignor”) and [the][each] Assignee identified in item 2
below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and
obligations of [the Assignors][the Assignees] hereunder are several and not joint.] Capitalized
terms used but not defined herein shall have the meanings given to them in the Credit Agreement
identified below (the “Credit Agreement”), receipt of a copy of which is hereby
acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1
attached hereto are hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.



     For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the
Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and
assumes from [the Assignor][the respective Assignors], subject to and in accordance with the
Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’]
rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under
the Credit Agreement and any other documents or instruments delivered pursuant thereto to the
extent related to the amount and percentage interest identified below of all of such outstanding
rights and obligations of [the Assignor][the respective Assignors] under the respective facilities
identified below and (ii) to the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of [the Assignor (in its capacity as a Lender)][the
respective Assignors (in their respective capacities as Lenders)] against any Person, whether known
or unknown, arising under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby or in any way
based on or related to any of the foregoing, including, but not limited to, contract claims, tort
claims, malpractice claims, statutory claims and all other claims at law or in equity related to
the rights and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant
to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii)
above being referred to herein collectively as [the][an] “Assigned Interest”). Each such
sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in
this Assignment and Assumption, without representation or warranty by [the][any] Assignor.




	1.	 	Assignor[s]: ______________________________
	 
	2.	 	Assignee[s]: ______________________________ [for each Assignee,
indicate [Affiliate][Approved Fund] of [identify Lender]]
	 
	3.	 	Borrower: Piedmont Natural Gas Company, Inc.
	 
	4.	 	Administrative Agent: Bank of America, N.A., as the administrative agent under the
Credit Agreement





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	5.	 	Credit Agreement: Credit Agreement, dated as of December 3, 2008, among Piedmont
Natural Gas Company, Inc., the Lenders from time to time party thereto, and Bank of America,
N.A., as Administrative Agent
	 
	6.	 	Assigned Interest:





	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Aggregate	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Amount of	 	 	Amount of	 	 	Percentage	 	 	 	 
	 	 	 	 	 	 	Commitment/	 	 	Commitment/	 	 	Assigned of	 	 	 	 
	 	 	 	 	 	 	Loans for all	 	 	Loans	 	 	Commitment/	 	 	CUSIP	 
	Assignor[s]1	 	Assignee[s]2	 	 	Lenders3	 	 	Assigned	 	 	Loans 4	 	 	Number	 
	 
	 	 	 	 	 	$	 	 	 	$	 	 	 	 	 	%	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	$	 	 	 	$	 	 	 	 	 	%	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	$	 	 	 	$	 	 	 	 	 	%	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






	[7.	 	 Trade Date: __________________] 5




Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE
THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]




     The terms set forth in this Assignment and Assumption are hereby agreed to:



	 	 	 	 	 
	 	ASSIGNOR



[NAME OF ASSIGNOR]

 	 
	 	By:  	 	 
	 	 	Title: 	 
	 	 	 	 
	 





 




			
	1	 	List each Assignor, as appropriate.
	 
	2	 	List each Assignee, as appropriate.
	 
	3	 	Amounts in this column and in the column
immediately to the right to be adjusted by the counterparties to take into
account any payments or prepayments made between the Trade Date and the
Effective Date.
	 
	4	 	Set forth, to at least 9 decimals, as a
percentage of the Commitment/Loans of all Lenders thereunder.
	 
	5	 	To be completed if the Assignor and the
Assignee intend that the minimum assignment amount is to be determined as of
the Trade Date.





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	 	ASSIGNEE



[NAME OF ASSIGNEE]

 	 
	 	By:  	 	 
	 	 	Title: 	 
	 	 	 	 
	 



	 	 	 	 	 
	Consented to and Accepted:



BANK OF AMERICA, N.A., as

  Administrative Agent

 	 
	By:  	 	 
	 	Title: 	 
	 	 	 
	 
	Consented to:



PIEDMONT NATURAL GAS COMPANY, INC.

 	 
	By:  	 	 
	 	Title: 	 
	 	 	 
	 



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ANNEX 1 TO ASSIGNMENT AND ASSUMPTION




STANDARD TERMS AND CONDITIONS FOR




ASSIGNMENT AND ASSUMPTION



          1. Representations and Warranties.





     1. Representations and Warranties.



          1.1. Assignor. [The][Each] Assignor (a) represents and warrants that (i) it is the
legal and beneficial owner of [the][the relevant] Assigned Interest, (ii) [the][such] Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full
power and authority, and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations made in or in
connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Loan Document or (iv) the performance or observance by
the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.




          1.2. Assignee. [The][Each] Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby and to become a Lender under the
Credit Agreement, (ii) it meets all the requirements to be an assignee under Section
10.06(b)(iii), (v) and (vi) of the Credit Agreement (subject to receipt of such
consents as may be required under the Credit Agreement), (iii) from and after the Effective Date,
it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the
extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender thereunder,
(iv) it is sophisticated with respect to decisions to acquire assets of the type presented by
[the][such] Assigned Interest and either it, or the Person exercising discretion in making its
decision to acquire [the][such] Assigned Interest, is experienced in acquiring assets of such type,
(v) it has received a copy of the Credit Agreement and has received or has been accorded the
opportunity to receive copies of the most recent financial statements delivered pursuant to
Section 6.01 thereof, as applicable, and such other documents and information as it deems
appropriate to make its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase [the][such] Assigned Interest, (vi) it has independently and without
reliance upon the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase [the][such] Assigned Interest, and (vii) if it is a
Foreign Lender, attached hereto is any documentation required to be delivered by it pursuant to the
terms of the Credit Agreement, duly completed and executed by [the][such] Assignee; and (b) agrees
that (i) it will, independently and without reliance upon the Administrative Agent, [the][any]
Assignor or any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or not




Form of Assignment and Assumption




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taking action under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are required to be performed
by it as a Lender.




          2. Payments. From and after the Effective Date, the Administrative Agent shall make
all payments in respect of [the][each] Assigned Interest (including payments of principal,
interest, fees and other amounts) to [the][the relevant] Assignor for amounts which have accrued to
but excluding the Effective Date and to [the][relevant] Assignee for amounts which have accrued
from and after the Effective Date.




          3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and assigns. This
Assignment and Assumption may be executed in any number of counterparts, which together shall
constitute one instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a manually executed
counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of North Carolina.




Form of Assignment and Assumption





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EXHIBIT E




FORM OF GUARANTY AGREEMENT




     THIS GUARANTY AGREEMENT (this “Guaranty Agreement”), dated as of                     , 20     , is
made by EACH OF THE UNDERSIGNED AND EACH OTHER PERSON WHO SHALL BECOME A PARTY HERETO BY EXECUTION
OF A GUARANTY JOINDER AGREEMENT (each a “Guarantor” and collectively the
“Guarantors”) to BANK OF AMERICA, N.A., a national banking association organized and
existing under the laws of the United States, as administrative agent (in such capacity, the
“Administrative Agent”) for each of the lenders (the “Lenders” now or hereafter
party to the Credit Agreement defined below (collectively with the Administrative Agent, and
certain other Persons parties to Related Credit Arrangements as more particularly described in
Section 19 hereof, the “Beneficiaries”). All capitalized terms used but not
otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement.



W I T N E S S E T H:



     WHEREAS, the Beneficiaries have agreed to provide to PIEDMONT NATURAL GAS COMPANY, INC. (the
“Borrower”) certain credit facilities, including a revolving credit facility pursuant to
the terms of that certain Credit Agreement dated as of December 3, 2008, among the Borrower, the
Administrative Agent and the Lenders (as from time to time amended, revised, modified, supplemented
or amended and restated, the “Credit Agreement”); and



     WHEREAS, each Guarantor is, directly or indirectly, a Subsidiary of the Borrower that is a
Regulated Entity and will materially benefit from the Loans made and to be made under the Credit
Agreement; and



     WHEREAS, each Guarantor is required to enter into this Guaranty Agreement pursuant to the
terms of the Credit Agreement; and



     WHEREAS, a material part of the consideration given in connection with and as an inducement to
the execution and delivery of the Credit Agreement by the Lenders and the Administrative Agent was
the obligation of the Borrower to cause each Guarantor to enter into this Guaranty Agreement, and
the Beneficiaries are unwilling to extend and maintain the credit facilities provided under the
Loan Documents unless the Guarantors enter into this Guaranty Agreement;



     NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein, the
parties hereto agree as follows:



     1. Guaranty. Each Guarantor hereby jointly and severally, unconditionally,
absolutely, continually and irrevocably guarantees to the Administrative Agent for the benefit of
the Beneficiaries the payment and performance in full of the Guaranteed Liabilities (as defined
below). For all purposes of this Guaranty Agreement, “Guaranteed Liabilities” means: (a)
the Borrower’s prompt payment in full, when due or declared due and at all such times, of all



Form of Guaranty Agreement



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Obligations and all other amounts pursuant to the terms of the Credit Agreement, the Notes,
and all other Loan Documents heretofore, now or at any time or times hereafter owing, arising, due
or payable from the Borrower to any one or more of the Beneficiaries, including principal,
interest, premiums and fees (including, but not limited to, loan fees and reasonable fees, charges
and disbursements of external counsel (“Attorney Costs”); (b) the Borrower’s prompt, full
and faithful performance, observance and discharge of each and every agreement, undertaking,
covenant and provision to be performed, observed or discharged by the Borrower under the Credit
Agreement, the Notes and all other Loan Documents; and (c) the prompt payment in full by each Loan
Party, when due or declared due and at all such times, of obligations and liabilities now or
hereafter arising under Related Credit Arrangements. The Guarantors’ obligations to the
Beneficiaries under this Guaranty Agreement are hereinafter collectively referred to as the
“Guarantors’ Obligations” and, with respect to each Guarantor individually, the
“Guarantor’s Obligations”. Notwithstanding the foregoing, the liability of each Guarantor
individually with respect to its Guarantor’s Obligations shall be limited to an aggregate amount
equal to the largest amount that would not render its obligations hereunder subject to avoidance
under Section 548 of the United States Bankruptcy Code or any comparable provisions of any
applicable state law.




     Each Guarantor agrees that it is jointly and severally, directly and primarily liable (subject
to the limitation in the immediately preceding sentence) for the Guaranteed Liabilities.



     2. Payment. If the Borrower shall default in payment or performance of any of the
Guaranteed Liabilities, whether principal, interest, premium, fee (including, but not limited to,
loan fees and Attorney Costs), or otherwise, when and as the same shall become due, and after
expiration of any applicable grace period, whether according to the terms of the Credit Agreement,
by acceleration, or otherwise, or upon the occurrence and during the continuance of any Event of
Default under the Credit Agreement, then any or all of the Guarantors will, upon demand thereof by
the Administrative Agent, fully pay to the Administrative Agent, for the benefit of the
Beneficiaries, subject to any restriction on each Guarantor’s Obligations set forth in Section
1 hereof, an amount equal to all the Guaranteed Liabilities then due and owing.



     3. Absolute Rights and Obligations. This is a guaranty of payment and not of
collection. The Guarantors’ Obligations under this Guaranty Agreement shall be joint and several,
absolute and unconditional irrespective of, and each Guarantor hereby expressly waives, to the
extent permitted by law, any defense to its obligations under this Guaranty Agreement to which it
is a party by reason of:




     (a) any lack of legality, validity or enforceability of the Credit Agreement, of any of
the Notes, of any other Loan Document, or of any other agreement or instrument creating,
providing security for, or otherwise relating to any of the Guarantors’ Obligations, any of
the Guaranteed Liabilities, or any other guaranty of any of the Guaranteed Liabilities (the
Loan Documents and all such other agreements and instruments being collectively referred to
as the “Related Agreements”);




     (b) any action taken under any of the Related Agreements, any exercise of any right or
power therein conferred, any failure or omission to enforce any right conferred thereby, or
any waiver of any covenant or condition therein provided;



Form of Guaranty Agreement



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     (c) any acceleration of the maturity of any of the Guaranteed Liabilities, of the
Guarantor’s Obligations of any other Guarantor, or of any other obligations or liabilities
of any Person under any of the Related Agreements;




     (d) any release, exchange, non-perfection, lapse in perfection, disposal, deterioration
in value, or impairment of any security for any of the Guaranteed Liabilities, for any of
the Guarantor’s Obligations of any Guarantor, or for any other obligations or liabilities of
any Person under any of the Related Agreements;




     (e) any dissolution of the Borrower or any Guarantor or any other party to a Related
Agreement, or the combination or consolidation of the Borrower or any Guarantor or any other
party to a Related Agreement into or with another entity or any transfer or disposition of
any assets of the Borrower or any Guarantor or any other party to a Related Agreement;




     (f) any extension (including without limitation extensions of time for payment),
renewal, amendment, restructuring or restatement of, any acceptance of late or partial
payments under, or any change in the amount of any borrowings or any credit facilities
available under, the Credit Agreement, any of the Notes or any other Loan Document or any
other Related Agreement, in whole or in part;




     (g) the existence, addition, modification, termination, reduction or impairment of
value, or release of any other guaranty (or security therefor) of the Guaranteed Liabilities
(including without limitation the Guarantor’s Obligations of any other Guarantor and
obligations arising under any other Guaranty now or hereafter in effect);




     (h) any waiver of, forbearance or indulgence under, or other consent to any change in
or departure from any term or provision contained in the Credit Agreement, any other Loan
Document or any other Related Agreement, including without limitation any term pertaining to
the payment or performance of any of the Guaranteed Liabilities, any of the Guarantor’s
Obligations of any other Guarantor, or any of the obligations or liabilities of any party to
any other Related Agreement;




     (i) any other circumstance whatsoever (with or without notice to or knowledge of any
Guarantor) which may or might in any manner or to any extent vary the risks of such
Guarantor, or might otherwise constitute a legal or equitable defense available to, or
discharge of, a surety or a guarantor, including without limitation any right to require or
claim that resort be had to the Borrower or any other Loan Party or to any collateral in
respect of the Guaranteed Liabilities or Guarantors’ Obligations, whether arising under
North Carolina General Statutes Sections 26-7 and 26-9 or otherwise.


It is the express purpose and intent of the parties hereto that this Guaranty Agreement and the
Guarantors’ Obligations hereunder and under each Guaranty Joinder Agreement shall be absolute and
unconditional under any and all circumstances and shall not be discharged except by payment as
herein provided.




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     4. Currency and Funds of Payment. All Guarantors’ Obligations will be paid in lawful
currency of the United States of America and in immediately available funds, regardless of any law,
regulation or decree now or hereafter in effect that might in any manner affect the Guaranteed
Liabilities, or the rights of any Beneficiary with respect thereto as against the Borrower, or
cause or permit to be invoked any alteration in the time, amount or manner of payment by the
Borrower of any or all of the Guaranteed Liabilities.



     5. Events of Default. Without limiting the provisions of Section 2 hereof, in
the event that there shall occur and be continuing an Event of Default, then notwithstanding any
collateral or other security or credit support for the Guaranteed Liabilities, at the
Administrative Agent’s election and without notice thereof or demand therefor, the Guarantors’
Obligations shall immediately be and become due and payable.



     6. Subordination. Until this Guaranty Agreement is terminated in accordance with
Section 22 hereof, each Guarantor hereby unconditionally subordinates all present and
future debts, liabilities or obligations now or hereafter owing to such Guarantor (i) of the
Borrower, to the payment in full of the Guaranteed Liabilities, (ii) of every other Guarantor (an
“obligated guarantor”), to the payment in full of the Guarantors’ Obligations of such obligated
guarantor, and (iii) of each other Person now or hereafter constituting a Loan Party, to the
payment in full of the obligations of such Loan Party owing to any Beneficiary and arising under
the Loan Documents or the Related Credit Arrangements. All amounts due under such subordinated
debts, liabilities, or obligations shall, upon the occurrence and during the continuance of an
Event of Default (but not until such time that an Event of Default has occurred and is continuing),
be collected and, upon request by the Administrative Agent, paid over forthwith to the
Administrative Agent for the benefit of the Beneficiaries on account of the Guaranteed Liabilities,
the Guarantors’ Obligations, or such other obligations, as applicable, and, after such request and
pending such payment, shall be held by such Guarantor as agent and bailee of the Beneficiaries
separate and apart from all other funds, property and accounts of such Guarantor.



     7. Suits. Each Guarantor from time to time shall pay to the Administrative Agent for
the benefit of the Beneficiaries, on demand, at the Administrative Agent’s Office or such other
address as the Administrative Agent shall give notice of to such Guarantor, the Guarantors’
Obligations as they become or are declared due, and in the event such payment is not made
forthwith, the Administrative Agent may proceed to suit against any one or more or all of the
Guarantors. At the Administrative Agent’s election, one or more and successive or concurrent suits
may be brought hereon by the Administrative Agent against any one or more or all of the Guarantors,
whether or not suit has been commenced against the Borrower, any other Guarantor, or any other
Person and whether or not the Beneficiaries have taken or failed to take any other action to
collect all or any portion of the Guaranteed Liabilities or have taken or failed to take any
actions against any collateral securing payment or performance of all or any portion of the
Guaranteed Liabilities, and irrespective of any event, occurrence, or condition described in
Section 3 hereof.



     8. Set-Off and Waiver. Each Guarantor waives any right to assert against any
Beneficiary as a defense, counterclaim, set-off, recoupment or cross claim in respect of its



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Guarantor’s Obligations, any defense (legal or equitable) or other claim which such Guarantor
may now or at any time hereafter have against the Borrower or any or all of the Beneficiaries
without waiving any additional defenses, set-offs, counterclaims or other claims otherwise
available to such Guarantor.




     9. Waiver of Notice; Subrogation.




     (a) Each Guarantor hereby waives to the extent permitted by law notice of the following
events or occurrences: (i) acceptance of this Guaranty Agreement; (ii) the Lenders’
heretofore, now or from time to time hereafter making Loans and otherwise loaning monies or
giving or extending credit to or for the benefit of the Borrower or any other Loan Party, or
otherwise entering into arrangements with any Loan Party giving rise to Guaranteed
Liabilities, whether pursuant to the Credit Agreement or the Notes or any other Loan
Document or Related Agreement or any amendments, modifications, or supplements thereto, or
replacements or extensions thereof; (iii) presentment, demand, default, non-payment, partial
payment and protest; and (iv) any other event, condition, or occurrence described in
Section 3 hereof. Each Guarantor agrees that each Beneficiary may heretofore, now
or at any time hereafter do any or all of the foregoing in such manner, upon such terms and
at such times as each Beneficiary, in its sole and absolute discretion, deems advisable,
without in any way or respect impairing, affecting, reducing or releasing such Guarantor
from its Guarantor’s Obligations, and each Guarantor hereby consents to each and all of the
foregoing events or occurrences.




     (b) Each Guarantor hereby agrees that payment or performance by such Guarantor of its
Guarantor’s Obligations under this Guaranty Agreement may be enforced by the Administrative
Agent on behalf of the Beneficiaries upon demand by the Administrative Agent to such
Guarantor without the Administrative Agent being required, such Guarantor expressly waiving
to the extent permitted by law any right it may have to require the Administrative Agent, to
(i) prosecute collection or seek to enforce or resort to any remedies against the Borrower
or any other Guarantor or any other guarantor of the Guaranteed Liabilities, or (ii) seek to
enforce or resort to any remedies with respect to any security interests, Liens or
encumbrances granted to the Administrative Agent or any Lender or other party to a Related
Agreement by the Borrower, any other Guarantor or any other Person on account of the
Guaranteed Liabilities or any guaranty thereof, IT BEING EXPRESSLY UNDERSTOOD, ACKNOWLEDGED
AND AGREED TO BY SUCH GUARANTOR THAT DEMAND UNDER THIS GUARANTY AGREEMENT MAY BE MADE BY THE
ADMINISTRATIVE AGENT, AND THE PROVISIONS HEREOF ENFORCED BY THE ADMINISTRATIVE AGENT,
EFFECTIVE AS OF THE FIRST DATE ANY EVENT OF DEFAULT OCCURS AND IS CONTINUING UNDER THE
CREDIT AGREEMENT.




     (c) Each Guarantor further agrees with respect to this Guaranty Agreement that it shall
have no right of subrogation, reimbursement, contribution or indemnity, nor any right of
recourse to security for the Guaranteed Liabilities unless and until 93 days immediately
following the Facility Termination Date (as defined below) shall have



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elapsed without the filing or commencement, by or against any Loan Party, of any state or
federal action, suit, petition or proceeding seeking any reorganization, liquidation or
other relief or arrangement in respect of creditors of, or the appointment of a receiver,
liquidator, trustee or conservator in respect to, such Loan Party or its assets. This
waiver is expressly intended to prevent the existence of any claim in respect to such
subrogation, reimbursement, contribution or indemnity by any Guarantor against the estate of
any other Loan Party within the meaning of Section 101 of the Bankruptcy Code, in the event
of a subsequent case involving any other Loan Party. If an amount shall be paid to any
Guarantor on account of such rights at any time prior to termination of this Guaranty
Agreement in accordance with the provisions of Section 22 hereof, such amount shall
be held in trust for the benefit of the Beneficiaries and shall forthwith be paid to the
Administrative Agent, for the benefit of the Beneficiaries, to be credited and applied upon
the Guarantors’ Obligations, whether matured or unmatured, in accordance with the terms of
the Credit Agreement or otherwise as the Beneficiaries may elect. The agreements in this
subsection shall survive repayment of all of the Guarantors’ Obligations, the termination or
expiration of this Guaranty Agreement in any manner, including but not limited to
termination in accordance with Section 22 hereof, and occurrence of the Facility
Termination Date. For purposes of this Guaranty Agreement, “Facility Termination
Date” means the date as of which all of the following shall have occurred: (a) the
Borrower shall have permanently terminated the credit facilities under the Loan Documents by
final payment in full of all Outstanding Amounts, together with all accrued and unpaid
interest and fees thereon; (b) all Commitments shall have terminated or expired; (c) the
obligations and liabilities of the Borrower and each other Loan Party under all Related
Credit Arrangements shall have been fully, finally and irrevocably paid and satisfied in
full and the Related Credit Arrangements shall have expired or been terminated, or other
arrangements satisfactory to the counterparties shall have been made with respect thereto;
and (d) the Borrower and each other Loan Party shall have fully, finally and irrevocably
paid and satisfied in full all of their respective obligations and liabilities arising under
the Loan Documents, including with respect to the Borrower and the Obligations (except for
future obligations consisting of continuing indemnities and other contingent Obligations of
the Borrower or any Loan Party that may be owing to any of its Related Parties or any Lender
pursuant to the Loan Documents and expressly survive termination of the Credit Agreement or
any other Loan Document).



     10. Effectiveness; Enforceability. This Guaranty Agreement shall be effective as of
the date first above written and shall continue in full force and effect until termination in
accordance with Section 22 hereof. Any claim or claims that the Beneficiaries may at any
time hereafter have against a Guarantor under this Guaranty Agreement may be asserted by the
Administrative Agent on behalf of the Beneficiaries by written notice directed to such Guarantor in
accordance with Section 24 hereof.



     11. Representations and Warranties. Each Guarantor warrants and represents to the
Administrative Agent, for the benefit of the Beneficiaries, that it is duly authorized to execute
and deliver this Guaranty Agreement (or the Guaranty Joinder Agreement to which it is a party, as
applicable), and to perform its obligations under this Guaranty Agreement, that this Guaranty
Agreement (or the Guaranty Joinder Agreement to which it is a party, as applicable) has been



Form of Guaranty Agreement



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duly executed and delivered on behalf of such Guarantor by its duly authorized
representatives; that this Guaranty Agreement (and any Guaranty Joinder Agreement to which such
Guarantor is a party) is legal, valid, binding and enforceable against such Guarantor in accordance
with its terms except as enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general
equitable principles; and that such Guarantor’s execution, delivery and performance of this
Guaranty Agreement (and any Guaranty Joinder Agreement to which such Guarantor is a party) do not
violate or constitute a breach of any of its Organizational Documents, any agreement or instrument
to which such Guarantor is a party, or any law, order, regulation, decree or award of any
governmental authority or arbitral body to which it or its properties or operations is subject.




     12. Expenses. Each Guarantor agrees to be jointly and severally liable for the
payment of all reasonable fees and expenses, including Attorney Costs, incurred by any Beneficiary
in connection with the enforcement of this Guaranty Agreement, whether or not suit be brought.



     13. Reinstatement. Each Guarantor agrees that this Guaranty Agreement shall continue
to be effective or be reinstated, as the case may be, at any time payment received by any
Beneficiary in respect of any Guaranteed Liabilities is rescinded or must be restored for any
reason, or is repaid by any Beneficiary in whole or in part in good faith settlement of any pending
or threatened avoidance claim.



     14. [Intentionally Omitted.]



     15. Reliance. Each Guarantor represents and warrants to the Administrative Agent, for
the benefit of the Beneficiaries, that: (a) such Guarantor has adequate means to obtain on a
continuing basis (i) from the Borrower, information concerning the Loan Parties and the Loan
Parties’ financial condition and affairs and (ii) from other reliable sources, such other
information as it deems material in deciding to provide this Guaranty Agreement and any Guaranty
Joinder Agreement (“Other Information”), and has full and complete access to the Loan
Parties’ books and records and to such Other Information; (b) such Guarantor is not relying on any
Beneficiary or its or their employees, directors, agents or other representatives or Affiliates, to
provide any such information, now or in the future; (c) such Guarantor has been furnished with and
reviewed the terms of the Credit Agreement and such other Loan Documents and Related Agreements as
it has requested, is executing this Guaranty Agreement (or the Guaranty Joinder Agreement to which
it is a party, as applicable) freely and deliberately, and understands the obligations and
financial risk undertaken by providing this Guaranty Agreement (and any Guaranty Joinder
Agreement); (d) such Guarantor has relied solely on the Guarantor’s own independent investigation,
appraisal and analysis of the Borrower, the Borrower’s financial condition and affairs, the “Other
Information”, and such other matters as it deems material in deciding to provide this Guaranty
Agreement (and any Guaranty Joinder Agreement) and is fully aware of the same; and (e) such
Guarantor has not depended or relied on any Beneficiary or its or their employees, directors,
agents or other representatives or Affiliates, for any information whatsoever concerning the
Borrower or the Borrower’s financial condition and affairs or any other matters material to such
Guarantor’s decision to provide this Guaranty Agreement (and any



Form of Guaranty Agreement



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Guaranty Joinder Agreement), or for any counseling, guidance, or special consideration or any
promise therefor with respect to such decision. Each Guarantor agrees that no Beneficiary has any
duty or responsibility whatsoever, now or in the future, to provide to such Guarantor any
information concerning the Borrower or the Borrower’s financial condition and affairs, or any Other
Information, other than as expressly provided herein, and that, if such Guarantor receives any such
information from any Beneficiary or its or their employees, directors, agents or other
representatives or Affiliates, such Guarantor will independently verify the information and will
not rely on any Beneficiary or its or their employees, directors, agents or other representatives
or Affiliates, with respect to such information.




     16. Rules of Interpretation. The rules of interpretation contained in Sections
1.02 and 1.05 of the Credit Agreement shall be applicable to this Guaranty Agreement
and each Guaranty Joinder Agreement and are hereby incorporated by reference. All representations
and warranties contained herein shall survive the delivery of documents and any extension of credit
referred to herein or guaranteed hereby.



     17. [Intentionally Omitted.]



     18. Binding Agreement; Assignment. Subject to the limitations referenced in this
Section 18 and in the Credit Agreement regarding assignment, this Guaranty Agreement, each
Guaranty Joinder Agreement and the terms, covenants and conditions hereof and thereof, shall be
binding upon and inure to the benefit of the parties hereto and thereto, and to their respective
heirs, legal representatives, successors and assigns; provided, however, that no
Guarantor shall be permitted to assign any of its rights, powers, duties or obligations under this
Guaranty Agreement, any Guaranty Joinder Agreement or any other interest herein or therein without
the prior written consent of the Administrative Agent. Without limiting the generality of the
foregoing sentence of this Section 18, any Lender may assign to one or more Persons, or
grant to one or more Persons participations in or to, all or any part of its rights and obligations
under the Credit Agreement (to the extent permitted by the Credit Agreement); and to the extent of
any such assignment or participation such other Person shall, to the fullest extent permitted by
law, thereupon become vested with all the benefits in respect thereof granted to such Lender herein
or otherwise, subject however, to the provisions of the Credit Agreement, including Article
IX thereof (concerning the Administrative Agent) and Section 10.07 thereof concerning
assignments and participations. All references herein to the Administrative Agent shall include
any successor thereof.



     19. Related Credit Arrangements. All obligations of any Loan Party under Related
Credit Arrangements to which any Lender or its Affiliates are a party shall be deemed to be
Guaranteed Liabilities, and each Lender or Affiliate of a Lender party to any such Related Credit
Arrangement shall be deemed to be a Beneficiary hereunder with respect to such Guaranteed
Liabilities; provided, however, that such obligations shall cease to be Guaranteed
Liabilities at such time, prior to the Facility Termination Date, as such Person (or Affiliate of
such Person) shall cease to be a “Lender” under the Credit Agreement.



     No Person who obtains the benefit of this Guaranty Agreement by virtue of the provisions of
this Section shall have, prior to the Facility Termination Date, any right to notice of



Form of Guaranty Agreement



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any action or to consent to, direct or object to any action hereunder or under any other Loan
Document or otherwise in respect of the Guarantors’ Obligations (including the release or
modification of any Guarantors’ Obligations or security therefor) other than in its capacity as a
Lender and only to the extent expressly provided in the Loan Documents. Each Beneficiary not a
party to the Credit Agreement who obtains the benefit of this Guaranty Agreement by virtue of the
provisions of this Section shall be deemed to have acknowledged and accepted the appointment of the
Administrative Agent pursuant to the terms of the Credit Agreement, and that with respect to the
actions and omissions of the Administrative Agent hereunder or otherwise relating hereto that do or
may affect such Beneficiary, the Administrative Agent and each of its Related Parties shall be
entitled to all the rights, benefits and immunities conferred under Article IX of the
Credit Agreement.




     20. Severability. The provisions of this Guaranty Agreement are independent of and
separable from each other. If any provision hereof shall for any reason be held invalid or
unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability
of any other provision hereof, but this Guaranty Agreement shall be construed as if such invalid or
unenforceable provision had never been contained herein.



     21. Counterparts. This Guaranty Agreement may be executed in any number of
counterparts each of which when so executed and delivered shall be deemed an original, and it shall
not be necessary in making proof of this Guaranty Agreement to produce or account for more than one
such counterpart executed by the Guarantors against whom enforcement is sought. Without limiting
the foregoing provisions of this Section 21, the provisions of Section 10.10 of the
Credit Agreement shall be applicable to this Guaranty Agreement.



     22. Termination. Subject to reinstatement pursuant to Section 13 hereof, this
Guaranty Agreement and each Guaranty Joinder Agreement, and all of the Guarantors’ Obligations
hereunder (excluding those Guarantors’ obligations relating to Guaranteed Liabilities that
expressly survive such termination) shall terminate on the Facility Termination Date.



     23. Remedies Cumulative; Late Payments. All remedies hereunder are cumulative and are
not exclusive of any other rights and remedies of the Administrative Agent or any other Beneficiary
provided by law or under the Credit Agreement, the other Loan Documents or other applicable
agreements or instruments. The making of the Loans and other credit extensions pursuant to the
Credit Agreement and other Related Agreements shall be conclusively presumed to have been made or
extended, respectively, in reliance upon each Guarantor’s guaranty of the Guaranteed Liabilities
pursuant to the terms hereof. Any amounts not paid when due under this Guaranty Agreement shall
bear interest at the Default Rate.



     24. Notices. Any notice required or permitted hereunder or under any Guaranty Joinder
Agreement shall be given, (a) with respect to each Guarantor, at the address of the Borrower
indicated in Schedule 10.02 of the Credit Agreement and (b) with respect to the
Administrative Agent or any other Beneficiary, at the Administrative Agent’s address indicated in
Schedule 10.02 of the Credit Agreement. All such addresses may be modified, and all such



Form of Guaranty Agreement



E-9









 




notices shall be given and shall be effective, as provided in Section 10.02 of the Credit
Agreement for the giving and effectiveness of notices and modifications of addresses thereunder.




     25. Joinder. Each Person who shall at any time execute and deliver to the
Administrative Agent a Guaranty Joinder Agreement substantially in the form attached as Exhibit A
hereto shall thereupon irrevocably, absolutely and unconditionally become a party hereto and
obligated hereunder as a Guarantor, and all references herein and in the other Loan Documents to
the Guarantors or to the parties to this Guaranty Agreement shall be deemed to include such Person
as a Guarantor hereunder.



     26. Governing Law; Venue; Waiver of Jury Trial.



     (a) GOVERNING LAW. THIS GUARANTY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NORTH CAROLINA.



     (b) SUBMISSION TO JURISDICTION. EACH GUARANTOR HERETO IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE
OF NORTH CAROLINA SITTING IN MECKLENBURG COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE
WESTERN DISTRICT OF NORTH CAROLINA, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY AGREEMENT OR ANY GUARANTY JOINDER AGREEMENT,
OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH GUARANTOR HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NORTH CAROLINA STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, IN SUCH FEDERAL COURT. EACH GUARANTOR HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION
OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS GUARANTY AGREEMENT OR IN ANY
GUARANTY JOINDER AGREEMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY
OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS GUARANTY AGREEMENT OR ANY
GUARANTY JOINDER AGREEMENT AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.



     (c) WAIVER OF VENUE. EACH GUARANTOR HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY
AGREEMENT OR ANY GUARANTY JOINDER AGREEMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS
SECTION. EACH GUARANTOR HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST



Form of Guaranty Agreement



E-10









 




EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.




     (d) SERVICE OF PROCESS. EACH GUARANTOR HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 24. NOTHING IN THIS GUARANTY
AGREEMENT WILL AFFECT THE RIGHT OF ANY GUARANTOR HERETO TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY APPLICABLE LAW.



     (e) WAIVER OF JURYTRIAL. EACH GUARANTOR HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY AGREEMENT OR ANY
GUARANTY JOINDER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). EACH GUARANTOR HERETO (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER
PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS GUARANTY
AGREEMENT AND THE GUARANTY JOINDER AGREEMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.



[Signature page follows.]



Form of Guaranty Agreement



E-11









 





     IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Guaranty
Agreement as of the day and year first written above.



	 	 	 	 	 
	 	GUARANTORS:

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



	 	 	 	 	 
	 	ADMINISTRATIVE AGENT:





BANK OF AMERICA, N.A., as Administrative Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Form of Guaranty Agreement



E-12









 





EXHIBIT A




Form of Guaranty Joinder Agreement



GUARANTY JOINDER AGREEMENT




     THIS GUARANTY JOINDER AGREEMENT (the “Guaranty Joinder Agreement”), dated as of
            
        , 20      is made by     
                     
                     
              , a              
                           (the “Joining
Guarantor”), delivered to BANK OF AMERICA, N.A., in its capacity as Administrative Agent (the
“Administrative Agent”) under that certain Credit Agreement (as amended, revised, modified,
supplemented or amended and restated from time to time, the “Credit Agreement”), dated as
of December 3, 2008, by and among PIEDMONT NATURAL GAS COMPANY, INC. (the “Borrower”), the
Lenders party thereto and the Administrative Agent. All capitalized terms not otherwise defined
herein shall have the meanings given to such terms in the Credit Agreement.



     WHEREAS, the Joining Guarantor is a Subsidiary that is a Regulated Entity and required by the
terms of the Credit Agreement to become a “Guarantor” under the Credit Agreement and be
joined as a party to the Guaranty; and



     WHEREAS, the Joining Guarantor will materially benefit directly and indirectly from the credit
facilities made available and to be made available to the Borrower by the Lenders under the Credit
Agreement; and



     NOW, THEREFORE, the Joining Guarantor hereby agrees as follows with the Administrative Agent,
for the benefit of the Beneficiaries (as defined in the Guaranty and including any Lender or
Affiliate of any Lender party to any Related Credit Arrangement):



     1. Joinder. The Joining Guarantor hereby irrevocably, absolutely and unconditionally
becomes a party to the Guaranty as a Guarantor and bound by all the terms, conditions, obligations,
liabilities and undertakings of each Guarantor or to which each Guarantor is subject thereunder,
including without limitation the joint and several, unconditional, absolute, continuing and
irrevocable guarantee to the Administrative Agent for the benefit of the Beneficiaries of the
payment and performance in full of the Guaranteed Liabilities (as defined in the Guaranty) whether
now existing or hereafter arising, all with the same force and effect as if the Joining Guarantor
were a signatory to the Guaranty.



     2. Affirmations. The Joining Guarantor hereby acknowledges and reaffirms as of the
date hereof with respect to itself, its properties and its affairs each of the waivers,
representations, warranties, acknowledgements and certifications applicable to any Guarantor
contained in the Guaranty.



     3. Severability. The provisions of this Guaranty Joinder Agreement are independent of
and separable from each other. If any provision hereof shall for any reason be held invalid or
unenforceable, such invalidity or unenforceability shall not affect the validity or



Form of Guaranty Agreement



E-13









 




enforceability of any other provision hereof, but this Guaranty Joinder Agreement shall be
construed as if such invalid or unenforceable provision had never been contained herein.




     4. Counterparts. This Guaranty Joinder Agreement may be executed in any number of
counterparts each of which when so executed and delivered shall be deemed an original, and it shall
not be necessary in making proof of this Guaranty Joinder Agreement to produce or account for more
than one such counterpart executed by the Joining Guarantor. Without limiting the foregoing
provisions of this Section 4, the provisions of Section 10.02(b) of the Credit
Agreement shall be applicable to this Guaranty Joinder Agreement.



     5. Delivery. Joining Guarantor hereby irrevocably waives notice of acceptance of this
Guaranty Joinder Agreement and acknowledges that the Guaranteed Liabilities are and shall be deemed
to be incurred, and credit extensions under the Loan Documents and the Related Credit Arrangements
made and maintained, in reliance on this Guaranty Joinder Agreement and the Guarantor’s joinder as
a party to the Guaranty as herein provided.



     6. Governing Law; Venue; Waiver of Jury Trial. The provisions of Section 26
of the Guaranty are hereby incorporated by reference as if fully set forth herein.



     IN WITNESS WHEREOF, the Joining Guarantor has duly executed and delivered this Guaranty
Joinder Agreement as of the day and year first written above.



	 	 	 	 	 
	 	JOINING GUARANTOR:

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



Form of Guaranty Agreement



F-14









 





EXHIBIT G




OPINION MATTERS




See attached.




Opinion Matters



F-1









 









	 	 	 

	

	 	


	 

	 	Moore & Van Allen PLLC
	December 3, 2008

	 	Attorneys at Law
	 
	 	 
	 

	 	Suite 4700
	 

	 	100 North Tryon Street
	 

	 	Charlotte, NC 28202-4003
	 
	 	 
	 

	 	T 704 331 1000
	 

	 	F 704 331 1159
	 

	 	www.mvalaw.com





To Those on the Attached Distribution List



     Re: Credit Agreement in favor of Piedmont Natural Gas Company, Inc.


Ladies and Gentlemen:




     We have acted as special counsel to Piedmont Natural Gas Company, Inc., a North Carolina
corporation (the “Borrower”), in connection with that certain Credit Agreement dated as of December
3, 2008 (the “Credit Agreement”), by and among the Borrower; Bank of America, N.A., as
Administrative Agent; and each lender from time to time party thereto (the “Lenders”). Capitalized
terms used herein and not otherwise defined herein shall have the meanings assigned to such terms
in the Credit Agreement. For purposes of rendering our opinion set forth herein, we have reviewed
originals or copies, certified or otherwise identified to our satisfaction, of the following
documents, each of which is dated as of the date hereof:




	 	1.	 	the Credit Agreement;
	 
	 	2.	 	Note in favor of Bank of America, N.A.;
	 
	 	3.	 	Note in favor of Branch Banking and Trust Company;
	 
	 	4.	 	Note in favor of U.S. Bank National Association;
	 
	 	5.	 	Note in favor of Regions Bank;
	 
	 	6.	 	Note in favor of Carolina First Bank; and
	 
	 	7.	 	Note in favor of Fifth Third Bank, N.A.





     The Credit Agreement and the Notes are individually referred to herein as a “Loan Document”
and collectively as the “Loan Documents”. As to various questions of fact material to our opinion,
we have relied upon, and assumed without independent investigation the accuracy of, the
representations made by the parties to the Loan Documents (other than those which are expressed as
our opinions).



     In addition, for purposes of giving this opinion, we have examined such corporate records of
the Borrower, certificates of public officials, certificates of appropriate officers and officials
of the Borrower and such other documents, and have made such inquiries, as we have deemed
appropriate.



     In rendering the opinions expressed herein, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals, the conformity to original
documents of all



Research Triangle, NC

Charleston, SC


 









 





December 3, 2008

Page 2



documents submitted to us as conformed or photostatic copies and the authenticity of the originals
of such copies. For the purposes of the opinions hereinafter expressed, we have further assumed:
(i) the legal capacity of all natural persons executing any Loan Document; (ii) that there are no
oral or written statements or agreements, course of performance after the date hereof between any
parties to the Loan Documents, course of dealing between any parties to the Loan Documents or usage
of trade that modify, amend or vary any of the terms of any Loan Document; (iii) that, as to
factual matters, any certificate, representation or other document upon which we have relied and
which was given or dated earlier than the date of this opinion letter, continues to remain
accurate, insofar as relevant to the opinions contained herein, from such earlier date through and
including the date hereof; (iv) that there has been no mutual mistake of fact between any parties
to the Loan Documents, or misrepresentation, fraud or deceit on the part of any party to the Loan
Documents in connection with the execution, delivery, performance under, or transactions
contemplated by, the Loan Documents; (v) all parties to the Loan Documents (other than the
Borrower) are in good standing and validly existing under the laws of their respective
jurisdictions of organization; (vi) due authorization, execution and delivery of the Loan Documents
by all parties thereto (other than the Borrower); (vii) that each of the parties to the Loan
Documents (other than the Borrower) has the power and authority to execute and deliver the Loan
Documents to which it is a party and to perform its respective obligations thereunder; (viii) that
each Loan Document is valid, binding and enforceable against all parties thereto other than the
Borrower; (ix) that the execution and delivery by the Borrower of the Loan Documents and the
performance by the Borrower of its obligations thereunder will not violate or result in a breach of
any of the terms, conditions or provisions of (A) any law or regulation (other than any law or
regulation of the State of North Carolina or federal law or regulation of the United States, in
each case excepting any law or regulation that has been excepted from this opinion letter pursuant
to the next following paragraph and the enumerated items thereafter), (B) any order, writ,
judgment, injunction, or decree of any court, governmental authority or arbitrator, or (C) (except
as expressly provided in paragraph 3 below) any agreement, document or instrument to which any such
party is a party, by which it or its property is bound, or to which it is subject; and (x) that all
parties to the Loan Documents are in material compliance with all applicable laws, rules and
regulations governing the conduct of their business with respect to the transactions contemplated
by the Loan Documents.




     The opinions set forth herein are limited to matters governed by the laws of the State of
North Carolina and the federal laws of the United States, and no opinion is expressed herein as to
the laws of any other jurisdiction. We express no opinion concerning any matter respecting or
affected by any laws other than laws that a lawyer admitted to practice law in the State of North
Carolina exercising customary professional diligence would reasonably recognize as being directly
applicable to the Borrower or the transactions contemplated in the Loan Documents. Without limiting
the generality of the foregoing, we express no opinion concerning the following legal issues or the
application of any such laws or regulations to the matters on which our opinions are referenced:




     (i) federal and state securities laws and regulations;




     (ii) except as set forth in paragraph 6 hereof, Federal Reserve Board margin regulations;




     (iii) pension and employee benefit laws and regulations;




     (iv) federal and state antitrust and unfair competition laws and regulations, including
without limitation the Hart-Scott-Rodino Antitrust Improvements Act of 1976;




     (v) federal and state laws and regulations concerning document filing requirements and
notice other than the North Carolina Business Corporation Act;



 









 




December 3, 2008

Page 3





     (vi) compliance with fiduciary duty requirements;




     (vii) the statutes, administrative decisions, and rules and regulations of county,
municipal and special political subdivisions, whether state-level, regional or otherwise;




     (viii) fraudulent transfer laws;




     (ix) federal and state environmental laws and regulations;




     (x) federal and state tax laws and regulations;




     (xi) federal and state land use and subdivision laws and regulations;




     (xii) federal patent, copyright and trademark, state trademark, and other federal and
state intellectual property laws and regulations;




     (xiii) federal and state laws, regulations and policies concerning national and local
emergency;




     (xiv) state and federal regulatory laws or regulations specifically applicable to any
entity solely because of the business in which it is engaged;




     (xv) federal and state laws and regulations concerning the condition of title to any
property, the priority of any security interest or lien, or the perfection of a lien or
security interest in personal property; or




     (xvi) laws, rules and regulations relating to money laundering and terrorist groups,
including without limitation the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the “USA PATRIOT Act”), Public
Law 107-56, 115 Stat. 380 (October 26, 2001), as amended, Executive Order 13224, the Trading
with the Enemy Act, 50 App. U.S.C. 1, et. seq., any similar or related law and the rules and
regulations (temporary or permanent) promulgated under the foregoing or by the Office of
Foreign Assets Control of the United States Department of Treasury, as each is amended from
time to time.



          Based upon the foregoing, and such legal considerations as we have deemed necessary and
subject to the assumptions and qualifications set forth herein, we are of the opinion that:



          1. Based solely on a certificate from the Secretary of State of North Carolina dated as of
November 18, 2008, the Borrower is a corporation validly existing under the laws of the State of
North Carolina.



          2. The Borrower has all necessary corporate power to execute and deliver the Loan Documents
and to perform its obligations thereunder. The Loan Documents have been duly executed and delivered
by the Borrower.



          3. The execution and delivery by the Borrower of the Loan Documents and the performance by the
Borrower of its obligations thereunder (a) have been duly authorized by all requisite corporate
action on the part of the Borrower, (b) do not violate the articles of incorporation or bylaws of
the



 









 





December 3, 2008

Page 4



Borrower, (c) do not violate any federal law, rule or regulation of the United States of America or
any law, rule or regulation of the State of North Carolina and (d) do not result in a material
breach of or a material default under any document identified in Schedule 1 hereto (except that we
express no opinion with respect to (i) matters which require the performance of a mathematical
calculation or the making of a financial or accounting determination and (ii) the matters described
in the following sentence). Section 6A in each of the Senior Note Agreements purports to limit the
ability of Subsidiaries of the Borrower to make Restricted Payments in certain circumstances, and
such purported limitations technically conflict with the provisions of Section 7.05(a)(i) of the
Credit Agreement.




     4. Each of the Loan Documents constitutes a legal, valid and binding obligation of the
Borrower, enforceable against the Borrower in accordance with its terms.



     5. Based solely upon the factual certifications in the Officer’s Certificate in the form
attached hereto as Exhibit A, the Borrower is not an “investment company” within the meaning of the
Investment Company Act of 1940, as amended.



     6. Assuming the Borrower complies with the provisions of the Credit Agreement relating to the
use of proceeds of the Loans, the making of the Loans under the Credit Agreement does not violate
Regulation U or X of the Board of Governors of the Federal Reserve System.



     7. Under federal laws, rules and regulations of the United States of America and the laws,
rules and regulations of the State of North Carolina, no consent, approval, authorization,
declaration or filing by or with any governmental authority, commission, board or agency is
required for the execution, delivery and performance of the Loan Documents that has not been
obtained or made as of the date hereof.



     Our opinions concerning the enforceability of the Loan Documents are subject to the following
qualifications:



     (a) Enforcement of the Loan Documents may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratoria or similar state or federal debtor relief laws
from time to time in effect and which affect the enforcement of creditors’ rights in general.



     (b) Enforcement of the Loan Documents is subject both to general principles of equity and to
considerations of public policy, including the requirement that the parties thereto act with
commercial reasonableness and in good faith to the extent required by applicable law, the
application of which may deny certain rights and may be applied by a court of proper jurisdiction,
regardless of whether such enforceability is considered in a proceeding in equity or at law. For
purposes of this paragraph, the terms “general principles of equity” and “considerations of public
policy” may include, but are not limited to, issues related to the right to or obligation of the
appointment of a receiver in certain circumstances; the ability of an entity to appoint an
attorney-in-fact; fiduciary obligations of attorneys-in-fact; the enforceability of usury savings
clauses; waiver of procedural, substantive, or constitutional rights, including, without
limitation, the right of statutory or equitable redemption; disclaimers or limitations of
liability; waiver of defenses; waiver of acceleration rights through historical acceptance of late
payments; the exercise of self-help or other remedies without judicial process; accounting for rent
or sale proceeds; requirements of mitigation of damages; and enforcement of default interest
provisions. Any provision waiving a right to jury trial is unenforceable as against public policy
pursuant to North Carolina General Statutes Section 22B-10.



 









 





December 3, 2008

Page 5




     (c) The enforceability and availability of certain remedies, rights and waiver provisions, may
be limited or rendered ineffective by applicable law; provided, that subject to the other
exceptions noted herein, there exist legally adequate remedies for the realization of the principal
benefits intended to be afforded under the Loan Documents.



     (d) We express no opinion on the enforceability of any provision in a Loan Document purporting
to prohibit, restrict or condition the assignment of rights under such Loan Document to the extent
such restriction on assignability is rendered ineffective by Section 9-408 of the Uniform
Commercial Code.



     (e) We express no opinion with respect to any provision of the Loan Documents providing that
the acceptance by the Administrative Agent or any Lender of a past due installment or other
performance by a party shall not be deemed a waiver of its right to accelerate any payment
obligation or other rights under the Loan Documents.



     (f) We express no opinion with respect to any provision of the Loan Documents purporting to
require a party to pay or reimburse attorneys’ fees incurred by another party or to indemnify
another party therefor which may be limited by applicable law and public policy.



     (g) We express no opinion with respect to any waiver of the statute of limitations contained
in the Loan Documents.



     (h) We express no opinion with respect to any provision of the Loan Documents which requires
that any amendments or waivers to the Loan Documents must be in writing.



     (i) We express no opinion as to the enforceability of any provision in the Loan Documents that
purports to excuse a party for liability for its own acts.



     (j) We express no opinion as to the enforceability of any provision in the Loan Documents that
purports to make void any act done in contravention thereof.



     (k) We express no opinion as to the enforceability of any provision in the Loan Documents that
purports to authorize a party to act in its sole discretion, that imposes liquidated damages,
penalties, late payment charges or forfeiture or that relates to evidentiary standards or other
standards by which any of the Loan Documents is to be construed.



     (l) We express no opinion as to the enforceability of provisions of the Loan Documents
providing for the indemnification of or contribution to a party with respect to such party’s own
negligence or willful misconduct, or where such indemnification or contribution is contrary to
public policy.



     (m) Provisions, if any, in the Loan Documents to the effect that waiver by a party of
performance obligations by another party shall not be deemed a waiver of such party’s right
thereafter to cause the applicable document to be in default may not be enforceable in all
circumstances, unless such party shall (i) first provide written notice to the other party that
subsequent defaults will not be accepted and will result in a default under the Loan Documents, and
(ii) thereafter, timely and diligently pursue its default remedies under the Loan Documents. We
express no opinion on the enforceability of any provision of the Loan Documents to the extent that
such provision constitutes a waiver of illegality as a defense to performance of contract
obligations.



 









 





December 3, 2008

Page 6




     (n) We express no opinion with respect to any consent to venue, jurisdiction or service of
process provisions or any waiver of an objection that an action or proceeding has been brought in
an inconvenient forum.



     (o) We express no opinion with respect to any severability provisions.



     (p) We express no opinion with respect to any provision waiving the obligation to marshal
assets.



     (q) We express no opinion with respect to any provision of any Loan Document to the extent it
authorizes or permits any affiliate of a Lender or any purchaser of a participation interest to
set-off or apply any deposit, property or indebtedness.



     (r) North Carolina General Statutes Section 6-21.2 sets forth the procedures and limitations
applicable to the collection of attorneys’ fees and accordingly, any provisions in the Loan
Documents related to the ability of the Lenders or any other party to collect attorneys’ fees upon
default are subject to those limitations.



     Our opinion is rendered solely in connection with the transactions contemplated under the Loan
Documents and may not be relied upon for any other purpose or in any manner by any Person other
than the addressees hereof, except that we hereby consent to reliance hereon by any successor or
any future assignee (collectively, the “Reliance Parties”) of your interest in the loans under the
Credit Agreement pursuant to an assignment that is made and consented to in accordance with the
express provisions of Section 10.06 of the Credit Agreement, on the condition and understanding
that (i) this letter speaks only as of the date hereof, (ii) we have no responsibility or
obligation to update this letter, to consider its applicability or correctness to any person other
than its addressee(s), or to take into account changes in law, facts or any other developments of
which we may later become aware, and (iii) any such reliance by a Reliance Party must be actual and
reasonable under the circumstances existing at the time of assignment, including any changes in
law, facts or any other developments known to or reasonably knowable by the Reliance Party at such
time.



     No copies of this opinion may be delivered or furnished to any other party other than a
Reliance Party, nor may all or portions of this opinion be quoted, circulated or referred to in any
other document without our prior written consent, except that copies of this opinion may be
provided if required by applicable law or to any regulatory agency having supervisory authority
over a Reliance Party and except that this opinion may be used in connection with the assertion of
a defense as to which this opinion is relevant and necessary or in response to a court order or
other legal process. The opinions expressed in this letter are rendered as of the date hereof and
we express no opinion as to circumstances or events or change in applicable law that may occur
subsequent to such date.



	 	 	 	 	 
	 	Very truly yours,



MOORE & VAN ALLEN PLLC



/s/ MOORE & VAN ALLEN PLLC	 
	 	 	 
	 	 	 
	 	 	 



 









 







December 3, 2008

Page 7




Distribution List



Bank of America, N.A.,

     as Administrative Agent and a Lender



Branch Banking and Trust Company,

     as a Lender



U.S. Bank National Association,

     as a Lender



Regions Bank,

     as a Lender



Carolina First Bank,

     as a Lender



Fifth Third Bank, N.A.,

     as a Lender





 









 








Schedule 1




Material Contracts

(in the form as filed by Piedmont Natural Gas Company, Inc.

with the U.S. Securities and Exchange Commission)




	1.	 	Note Agreement, dated as of September 21, 1992, between Piedmont and Provident Life and
Accident Insurance Company (Exhibit 4.30, Form 10-K for the fiscal year ended October 31,
1992).






	2.	 	Indenture, dated as of April 1, 1993, between Piedmont and Citibank, N.A., Trustee (Exhibit
4.1, Form S-3 Registration Statement No. 33-59369),






	3.	 	Amendment to Note Agreement, dated as of September 16, 2005, by and between Piedmont and
Provident Life and Accident Insurance Company.






	4.	 	Medium-Term Note, Series A, dated as of July 23, 1993 (Exhibit 4.7, Form 10-K for the fiscal
year ended October 31, 1993).






	5.	 	Medium-Term Note, Series A, dated as of October 6, 1993 (Exhibit 4.8, Form 10-K for the
fiscal year ended October 31, 1993).






	6.	 	First Supplemental Indenture, dated as of February 25, 1994, between PNG Acquisition Company,
Piedmont Natural Gas Company, Inc., and Citibank, N.A., Trustee (Exhibit 4.2, Form S-3
Registration Statement No. 33-59369).
	 
	7.	 	Medium-Term Note, Series A, dated as of September 19, 1994 (Exhibit 4.9, Form 10-K for the
fiscal year ended October 31, 1994).
	 
	8.	 	Form of Master Global Note (Exhibit 4.4, Form S-3 Registration Statement No. 33-59369).
	 
	9.	 	Pricing Supplement of Medium-Term Notes, Series B, dated October 3, 1995 (Exhibit 4.10, Form
10-K for the fiscal year ended October 31, 1995).
	 
	10.	 	Pricing Supplement of Medium-Term Notes, Series B, dated October 4, 1996 (Exhibit 4.11, Form
10-K for the fiscal year ended October 31, 1996).
	 
	11.	 	Rights Agreement, dated as of February 27, 1998, between Piedmont and Wachovia Bank, N.A., as
Rights Agent, including the Rights Certificate (Exhibit 10.1, Form 8-K dated February 27,
1998).
	 
	12.	 	Agreement of Substitution and Amendment of Common Shares Rights Agreement, dated as of
December 18, 2003, between Piedmont and American Stock Transfer and Trust Company, Inc.
(Exhibit 4.10, Form S-3 Registration Statement No. 333-111806).
	 
	13.	 	Form of Master Global Note, executed September 9, 1999 (Exhibit 4.4, Form S-3 Registration
Statement No. 333-26161).




Schedule 1 - 1









 






	14.	 	Pricing Supplement of Medium Term Notes, Series C, dated September 15, 1999 (Rule 424(b)(3)
Pricing Supplement to Form S-3 Registration Statement Nos. 33-59369 and 333-26161).
	 
	15.	 	Pricing Supplement of Medium Term Notes, Series C, dated September 15, 1999 (Rule 424(b)(3)
Pricing Supplement to Form S-3 Registration Statement Nos. 33-59369 and 333-26161).
	 
	16.	 	Pricing Supplement No. 3 of Medium-Term Notes, Series C, dated September 26, 2000 (Rule
424(b)(3) Pricing Supplement to Form S-3 Registration Statement No. 333-26161).
	 
	17.	 	Form of Master Global Note, executed June 4, 2001 (Exhibit 4.4, Form S-3 Registration
Statement No. 333-62222).
	 
	18.	 	Pricing Supplement No. 1 of Medium Term Notes, Series D, dated September 18, 2001 (Rule
424(b)(3) Pricing Supplement to Form S-3 Registration Statement No. 333-62222).
	 
	19.	 	Second Supplemental Indenture, dated as of June 15, 2003, between Piedmont and Citibank,
N.A., Trustee (Exhibit 4.3, Form S-3 Registration Statement No. 33-106268).
	 
	20.	 	Form of 5% Medium-Term Note, Series E, dated as of December 19, 2003 (Exhibit 99.1, Form 8-K,
dated December 23, 2003).
	 
	21.	 	Form of 6% Medium-Term Note, Series E, dated as of December 19, 2003 (Exhibit 99.2, Form 8-K, dated December 23, 2003).
	 
	22.	 	Third Supplemental Indenture, dated as of June 20, 2006, between Piedmont Natural Gas
Company, Inc. and Citibank, N.A., as trustee (Exhibit 4.1, Form 8-K dated June 20,2006).
	 
	23.	 	Form of 6.25% Insured Quarterly Note Series 2006, Due 2036 (Exhibit 4.2 (as included in
Exhibit 4.1), Form 8-K dated June 20, 2006).
	 
	24.	 	Agreement of Resignation, Appointment and Acceptance dated as of March 29, 2007, by and among
the registrant, Citibank, N.A., and The Bank of New York Trust Company, N.A. (Exhibit 4.1,
Form 10-Q for quarter ended April 30, 2007).
	 
	25.	 	Amended and Restated Limited Liability Company Agreement of SouthStar Energy Services LLC,
effective January 1, 2004 between Piedmont Energy Company and Georgia Natural Gas Company
(Exhibit 10.1, Form 10-Q for the quarter ended April 30, 2004).
	 
	26.	 	First Amendment to Amended and Restated Limited Liability Company Agreement of SouthStar
Energy Services LLC, dated as of July 31, 2006, between Piedmont Energy Company and Georgia
Natural Gas Company (Exhibit 10.28, Form 10-K for the fiscal year ended October 31, 2006).
	 
	27.	 	Certified Extract of Resolutions dated as of November 20, 2006 concerning certain matters
under the Written Consent of the Executive Committee of SouthStar Energy Services LLC dated as
of August 28, 2006.
	 
	28.	 	Certified Extract of Resolutions dated as of November 20, 2006 concerning certain matters
under the Written Consent of the Executive Committee of SouthStar Energy Services LLC dated as
of September 20, 2006.




Schedule 1 - 2









 






	29.	 	Equity Contribution Agreement, dated as of November 12, 2004, between Columbia Gas Transmission
Corporation and Piedmont Natural Gas Company (Exhibit 10.1, Form 8-K dated November 16, 2004).
	 
	30.	 	Construction, Operation and Maintenance Agreement by and Between Columbia Gas Transmission
Corporation and Hardy Storage Company, LLC, dated November 12, 2004 (Exhibit 10.2, Form 8-K
dated November 16, 2004).
	 
	31.	 	Operating Agreement of Hardy Storage Company, LLC, dated as of November 12, 2004 (Exhibit
10.3, Form 8-K dated November 16, 2004).
	 
	32.	 	Guaranty of Principal dated as of June 29, 2006 by Piedmont Energy Partners, Inc. in favor of
US Bank National Association, as agent (Exhibit 10.1, Form 8-K dated July 5, 2006).
	 
	33.	 	Residual Guaranty dated as of June 29, 2006 by Piedmont Energy Partners, Inc. in favor of US
Bank National Association, as agent (Exhibit 10.2, Form 8-K dated July 5,2006).
	 
	34.	 	Credit Agreement dated as of April 25, 2006 among Piedmont Natural Gas Company, Inc. and Bank
of America, N.A.




Schedule 1 - 3









 











OFFICER’S CERTIFICATE

OF

PIEDMONT NATURAL GAS COMPANY, INC.

FOR

OPINION OF MOORE & VAN ALLEN PLLC




     I, Robert O. Pritchard, hereby certify that I am the duly elected, qualified and acting Vice
President, Treasurer and Chief Risk Officer of Piedmont Natural Gas Company, Inc., a North Carolina
corporation (“Borrower”), and do hereby certify:



     1. As Treasurer of the Borrower, I am familiar with the business and affairs of the Borrower
and with the proceedings taken in connection with Credit Agreement dated as of December 3, 2008
(the “Credit Agreement”), by and among the Borrower, Bank of America, N.A., as Administrative Agent
thereunder and each Lender from time to time party thereto. Capitalized terms used herein and not
otherwise defined herein shall have the respective meanings assigned to them in the Credit
Agreement. I have either personal knowledge of the matters and things hereinbelow set forth or have
obtained information with respect thereto from officers and employees of the Borrower in whom I
have confidence and whose duties require them to have personal knowledge thereof.



     2. I am familiar with the terms of the Credit Agreement and each of the other documents
entered into in connection with the transactions contemplated therein (the “Transaction Documents”)
and make this certificate with the intent that it shall be relied upon by Moore & Van Allen PLLC as
a basis for its opinion to be rendered with respect to the transactions contemplated by the
Transaction Documents.



     3. The Borrower is not an entity which (a) is or holds itself out as being engaged primarily,
or proposes to engage primarily, in the business of investing, reinvesting or trading in
securities; (b) is engaged or proposes to engage in the business of issuing face-amount
certificates of the installment type, or has been engaged in such business and has any such
certificate outstanding; or (c) is engaged or proposes to engage in the business of investing,
reinvesting, owning, holding or trading in securities, and owns or proposes to acquire “investment
securities” having a value exceeding forty percent (40%) of the value of the Borrower’s total
assets (exclusive of government securities and cash items) on an unconsolidated basis. As used in
this paragraph, “investment securities” includes all securities except (i) government securities,
(ii) securities issued by employees’ securities companies, and (iii) securities issued by
majority-owned subsidiaries of the owner which are not investment companies. As used in this
paragraph, “government securities” means any security issued or guaranteed as to principal or
interest by the United States, or by a person controlled or supervised by and acting as an
instrumentality of the Government of the United States pursuant to authority granted by the
Congress of the United States; or any certificate of deposit for any of the foregoing.



 









 





     4. None of the proceeds under the Credit Agreement will be used for the purpose of purchasing
or carrying “margin stock” or for the purpose of retiring indebtedness used for the purpose of
purchasing or carrying margin stock. As used herein, “margin stock” means:




     (i) any equity security registered or having unlisted trading privileges on a national
securities exchange;




     (ii) any equity security not traded on a national securities exchange but as to which
the Federal Reserve Board has determined to have the degree of national investor interest,
the depth and breadth of market, the availability of information respecting the security and
its issuer, and the permanence of the issuer to warrant being treated like an equity security
traded on a national securities exchange and which has been further identified by
publications by the Federal Reserve Board as an “OTC margin stock”;




     (iii) any OTC security designated as qualified for trading in the National Market
Systems under a designation plan approved by the Securities and Exchange Commission;




     (iv) any debt security convertible into a margin stock or carrying a warrant or right to
subscribe to or purchase a margin stock;




     (v) any warrant or right to subscribe to or purchase a margin stock; or




     (vi) any security issued by an investment company registered under Section 8 of the
Investment Company Act of 1940.



[Remainder of Page Intentionally Left Blank]






 









 








     IN WITNESS WHEREOF, the undersigned has executed this Officer’s Certificate this 3rd day of
December, 2008.



	 	 	 	 	 
	 	 	 
	 	By:  	/s/ Robert O. Pritchard
 	 
	 	 	Name:  	Robert O. Pritchard 	 
	 	 	Title:  	Vice President, Treasurer and 

Chief Risk Officer