Document:

Exhibit 4.14

 

EXECUTION VERSION

 

REGISTRATION RIGHTS AGREEMENT

 

 

Dated October 3, 2011

 

 

between

 

 

DOLPHIN SUBSIDIARY II, INC.

 

 

and

 

 

MERRILL LYNCH PIERCE FENNER & SMITH INCORPORATED
 BARCLAYS CAPITAL INC. 
 J.P. MORGAN SECURITIES LLC
 MORGAN STANLEY & CO. LLC

BNP PARIBAS SECURITIES CORP

CREDIT AGRICOLE SECURITIES (USA) INC.

MITSUBISHI UFJ SECURITIES (USA), INC.

SCOTIA CAPITAL (USA) INC.

 

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into as of October 3, 2011, between DOLPHIN SUBSIDIARY II, INC., a company incorporated under the laws of Delaware (the “Issuer”), and Merrill Lynch, Pierce, Fenner & Smith Incorporated and each of the other initial purchasers named in Schedule A hereto (collectively, the “Initial Purchasers”) for whom Merrill Lynch, Pierce, Fenner & Smith Incorporated is acting as the representative (the “Representative”).

 

This Agreement is made pursuant to the Purchase Agreement dated September 26, 2011 among the Issuer, DPL, Inc. (“DPL”), The AES Corporation (“AES”) and the Initial Purchasers (the “Purchase Agreement”), which provides for the sale by the Issuer to the Initial Purchasers of $450,000,000 aggregate principal amount of the Issuer’s 6.50% senior notes due 2016 and $800,000,000 aggregate principal amount of the Issuer’s 7.25% senior notes due 2021 (together, the “Securities”).  In order to induce the Initial Purchasers to enter into the Purchase Agreement, the Issuer has agreed to provide to the Initial Purchasers and their direct and indirect transferees the registration rights set forth in this Agreement.  The execution of this Agreement is a condition to the closing under the Purchase Agreement.

 

In consideration of the foregoing, the parties hereto agree as follows:

 

1.                                       Definitions.

 

As used in this Agreement, the following capitalized defined terms shall have the following meanings:

 

“1933 Act” shall mean the Securities Act of 1933, as amended from time to time.

 

“1934 Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

 

“Closing Date” shall mean the Closing Date as defined in the Purchase Agreement.

 

“Effectiveness Deadline” shall have the meaning set forth in Section 2(d).

 

“Exchange Offer” shall mean the exchange offer by the Issuer of Exchange Securities for Registrable Securities pursuant to Section 2(a) hereof.

 

“Exchange Offer Registration” shall mean a registration under the 1933 Act effected pursuant to Section 2(a) hereof.

 

“Exchange Offer Registration Statement” shall mean an exchange offer registration statement on Form S-4 (or, if applicable, on another appropriate form) and all amendments and supplements to such registration statement, in each case including the

 

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Prospectus contained therein, all exhibits thereto and all material incorporated by reference therein.

 

“Exchange Securities” shall mean securities issued by the Issuer under the Indenture containing terms identical to the Securities (except that the Exchange Securities will not contain restrictions on transfer) and to be offered to Holders of Securities in exchange for Securities pursuant to the Exchange Offer.

 

“Holder” shall mean the Initial Purchasers, for so long as they own any Registrable Securities, and each of their successors, assigns and direct and indirect transferees who become registered owners of Registrable Securities under the Indenture; provided that for purposes of Sections 4 and 5 of this Agreement, the term “Holder” shall include Participating Broker-Dealers (as defined in Section 4(a)).

 

“Indenture” shall mean the Indenture relating to the Securities dated as of October 3, 2011 between the Issuer and Wells Fargo Bank, N.A., as trustee, and as the same may be amended from time to time in accordance with the terms thereof.

 

“Initial Purchasers” shall have the meaning set forth in the preamble.

 

“Issuer” shall have the meaning set forth in the preamble including its successors.

 

“Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of outstanding Registrable Securities; provided that whenever the consent or approval of Holders of a specified percentage of Registrable Securities is required hereunder, Registrable Securities held by the Issuer or any of its affiliates (as such term is defined in Rule 405 under the 1933 Act) (other than the Initial Purchasers or subsequent Holders of Registrable Securities if such subsequent holders are deemed to be such affiliates solely by reason of their holding of such Registrable Securities) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage or amount.

 

“Merger” shall mean the merger of the Issuer with and into DPL, which shall occur subject to and upon the consummation of the merger of Dolphin Sub, Inc. with and into DPL pursuant to the Agreement and Plan of Merger dated as of April 19, 2011, among AES, DPL and Dolphin Sub, Inc.

 

“Person” shall mean an individual, partnership, limited liability company, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

 

“Prospectus” shall mean the prospectus included in a Registration Statement, including any preliminary prospectus, and any such prospectus as amended or supplemented by any prospectus supplement, including a prospectus supplement with respect to the terms of the offering of any portion of the Registrable Securities covered by a Shelf Registration Statement, and by all other amendments and supplements to such prospectus, and in each case including all material incorporated by reference therein.

 

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“Purchase Agreement” shall have the meaning set forth in the preamble.

 

“Registrable Securities” shall mean the Securities; provided, however, that the Securities shall cease to be Registrable Securities (i) when a Registration Statement with respect to such Securities shall have been declared effective under the 1933 Act and such Securities shall have been disposed of pursuant to such Registration Statement, (ii) when such Securities have been sold to the public pursuant to Rule 144 or (iii) when such Securities shall have ceased to be outstanding.

 

“Registration Expenses” shall mean any and all expenses incident to performance of or compliance by the Issuer with this Agreement, including without limitation:  (i) all SEC, stock exchange or Financial Industry Regulatory Authority, Inc. (“FINRA”) registration and filing fees, (ii) all fees and expenses incurred in connection with compliance with state securities or blue sky laws (including reasonable fees and disbursements of counsel for the Initial Purchasers in connection with blue sky qualification of any of the Exchange Securities or Registrable Securities), (iii) all expenses of any Persons in preparing or assisting in preparing, word processing, printing and distributing any Registration Statement, any Prospectus, any amendments or supplements thereto, any underwriting agreements, securities sales agreements and other documents relating to the performance of and compliance with this Agreement, (iv) all rating agency fees, (v) all fees and disbursements relating to the qualification of the Indenture under applicable securities laws, (vi) the fees and disbursements of the Trustee and its counsel, (vii) the fees and disbursements of counsel for the Issuer and, in the case of a Shelf Registration Statement, the fees and disbursements of one counsel for the Holders (which counsel shall be selected by the Majority Holders and which counsel may also be counsel for the Initial Purchasers) and (viii) the fees and disbursements of the independent public accountants of the Issuer, including the expenses of any special audits or “cold comfort” letters required by or incident to such performance and compliance, but excluding fees and expenses of counsel to the underwriters (other than fees and expenses set forth in clause (ii) above) or the Holders and underwriting discounts and commissions and transfer taxes, if any, relating to the sale or disposition of Registrable Securities by a Holder.

 

“Registration Statement” shall mean any registration statement of the Issuer that covers any of the Exchange Securities or Registrable Securities pursuant to the provisions of this Agreement and all amendments and supplements to any such Registration Statement, including post-effective amendments, in each case including the Prospectus contained therein, all exhibits thereto and all material incorporated by reference therein.

 

“SEC” shall mean the Securities and Exchange Commission.

 

“Shelf Registration” shall mean a registration effected pursuant to Section 2(b) hereof.

 

“Shelf Registration Statement” shall mean a “shelf” registration statement of the Issuer pursuant to the provisions of Section 2(b) of this Agreement which covers all of the Registrable Securities (but no other securities unless approved by the Holders whose

 

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Registrable Securities are covered by such Shelf Registration Statement) on an appropriate form under Rule 415 under the 1933 Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective amendments, in each case including the Prospectus contained therein, all exhibits thereto and all material incorporated by reference therein.

 

“Trustee” shall mean the trustee with respect to the Securities under the Indenture.

 

“Underwriter” shall have the meaning set forth in Section 3 hereof.

 

“Underwritten Registration” or “Underwritten Offering” shall mean a registration in which Registrable Securities are sold to an Underwriter for reoffering to the public.

 

2.                                       Registration Under the 1933 Act.

 

(a)  To the extent not prohibited by any applicable law or applicable interpretation of the Staff of the SEC, the Issuer shall use its reasonable best efforts to cause to be filed by the date that is the later of (i) 365 days after the date of issuance of the Securities and (ii) 90 days after the consummation of the Merger, and cause to become effective an Exchange Offer Registration Statement covering the offer by the Issuer to the Holders to exchange all of the Securities for Exchange Securities and to have such Registration Statement remain effective until the closing of the Exchange Offer.  The Issuer shall commence the Exchange Offer promptly after the Exchange Offer Registration Statement has been declared effective by the SEC, and use its reasonable best efforts to have the Exchange Offer consummated on or prior to the date that is the later of (i) 425 days following the issuance of the Securities and (ii) 150 days following the consummation of the Merger (the “Exchange Offer Closing Deadline”).  The Issuer shall commence the Exchange Offer by mailing or electronically transmitting (through the facilities of The Depositary Trust Company) the related exchange offer Prospectus and accompanying documents to each Holder stating, in addition to such other disclosures as are required by applicable law:

 

(i)                                     that the Exchange Offer is being made pursuant to this Registration Rights Agreement and that all Securities validly tendered will be accepted for exchange;

 

(ii)                                  the dates of acceptance for exchange (which shall be a period of at least 20 business days from the date such notice is mailed) (the “Exchange Dates”);

 

(iii)                               that any Registrable Security not tendered will remain outstanding and continue to accrue interest, but will not retain any rights under this Registration Rights Agreement;

 

(iv)                              that Holders electing to have a Security exchanged pursuant to the Exchange Offer will be required to (a) surrender such Security, together with the enclosed letters of transmittal, to the institution and at the address (located in the Borough of Manhattan, The City of New York) specified in the notice prior to the close of business on the last Exchange Date and (b) at the time of consummation of the Exchange Offer, (A) any Exchange Securities received by such Holder will be acquired in the ordinary course of its business, (B) such Holder will have no arrangement or

 

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understanding with any person to participate in the distribution of the Securities within the meaning of the Act, (C) if the Holder is not a Broker-Dealer or is a Broker-Dealer but will not receive Exchange Securities for its own account in exchange for Securities, neither the Holder nor any such other Person is engaged in or intends to participate in a distribution of the Exchange Securities and (D) that such Holder is not an Affiliate (as defined in Rule 501(b) under the 1933 Act) of the Issuer.  If the Holder is a Broker-Dealer that will receive Exchanger Securities for its own account in exchange for Securities, it will represent that the Securities to be exchanged for the Exchange Securities were acquired by it as a result of its market-making activities or other trading activities, and will acknowledge that it will deliver a prospectus meeting the requirements of the Act in connection with any resale of such Exchange Securities.  It is understood that, by acknowledging that it will deliver, and by delivering, a prospectus meeting the requirements of the Act in connection with any resale of such Exchange Securities, the Holder is not admitting that it is an “underwriter” within the meaning of the Act; and

 

(v)                                 that Holders will be entitled to withdraw their election, not later than the close of business on the last Exchange Date, by sending to the institution and at the address (located in the Borough of Manhattan, The City of New York) specified in the notice a telegram, telex, facsimile transmission or letter setting forth the name of such Holder, the principal amount of Securities delivered for exchange and a statement that such Holder is withdrawing his election to have such Securities exchanged.

 

As soon as practicable after the last Exchange Date, the Issuer shall:

 

(i)                                     accept for exchange Securities or portions thereof validly tendered and not validly withdrawn pursuant to the Exchange Offer; and

 

(ii)                                  deliver, or cause to be delivered, to the Trustee for cancellation all Securities or portions thereof so accepted for exchange by the Issuer and issue, and cause the Trustee to promptly authenticate and mail to each Holder, an Exchange Security equal in principal amount to the principal amount of the Securities surrendered by such Holder.

 

The Issuer shall use its reasonable best efforts to complete the Exchange Offer as provided above and shall comply with the applicable requirements of the 1933 Act, the 1934 Act and other applicable laws and regulations in connection with the Exchange Offer.  The Exchange Offer shall not be subject to any conditions, other than that the Exchange Offer does not violate applicable law or any applicable interpretation of the Staff of the SEC.

 

(b)                                 In the event that (i) the Issuer determines that the Exchange Offer Registration provided for in Section 2(a) above is not available or that the Exchange Offer may not be consummated by the Exchange Offer Closing Deadline because it would violate applicable law or the applicable interpretations of the Staff of the SEC, (ii) the Exchange Offer is not consummated on the Exchange Offer Closing Deadline or (iii) with respect to any Holder of Registrable Securities (A) such Holder is prohibited by applicable law or SEC policy from participating in the Exchange Offer, or (B) such Holder may not resell the Exchange Securities acquired by it in the Exchange Offer to the public without delivering a prospectus and that the Prospectus contained in the Exchange Offer Registration Statement is not appropriate or

 

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available for such resales by such Holder, or (C) such Holder is a Broker-Dealer and holds Securities acquired directly from the Issuer or one of its affiliates, then, upon such Holder’s written request, the Issuer shall use its reasonable best efforts to cause to be filed as soon as practicable after such determination, date or notice is given to the Issuer, as the case may be (the “Shelf Filing Obligation”, a Shelf Registration Statement providing for the sale by the Holders of all of the Registrable Securities and to have such Shelf Registration Statement declared effective by the SEC.  In the event the Issuer is required to file a Shelf Registration Statement solely as a result of the matters referred to in clause (iii) of the preceding sentence, the Issuer shall use its reasonable best efforts to file and have declared effective by the SEC both an Exchange Offer Registration Statement pursuant to Section 2(a) with respect to all Registrable Securities and a Shelf Registration Statement (which may be a combined Registration Statement with the Exchange Offer Registration Statement) with respect to offers and sales of Registrable Securities held by the Holders after completion of the Exchange Offer.  The Issuer agrees to use its reasonable best efforts to keep the Shelf Registration Statement continuously effective for a period of one year or such shorter period that will terminate when all of the Registrable Securities covered by the Shelf Registration Statement have been sold pursuant to the Shelf Registration Statement or are no longer outstanding.  The Issuer further agrees to supplement or amend the Shelf Registration Statement if required by the rules, regulations or instructions applicable to the registration form used by the Issuer for such Shelf Registration Statement or by the 1933 Act or by any other rules and regulations thereunder for shelf registration or if reasonably requested by a Holder with respect to information relating to such Holder, and to use its reasonable best efforts to cause any such amendment to become effective and such Shelf Registration Statement to become usable as soon as thereafter practicable.  The Issuer agrees to furnish to the Holders of Registrable Securities copies of any such supplement or amendment promptly after its being used or filed with the SEC.

 

(c)                                  The Issuer shall pay all Registration Expenses in connection with the registration pursuant to Section 2(a) or Section 2(b).  Each Holder shall pay all underwriting discounts and commissions and transfer taxes, if any, relating to the sale or disposition of such Holder’s Registrable Securities pursuant to the Shelf Registration Statement.

 

(d)                                 An Exchange Offer Registration Statement pursuant to Section 2(a) hereof or a Shelf Registration Statement pursuant to Section 2(b) hereof will not be deemed to have become effective unless it has been declared effective by the SEC; provided, however, that, if, after it has been declared effective, the offering of Registrable Securities pursuant to a Shelf Registration Statement is interfered with by any stop order, injunction or other order or requirement of the SEC or any other governmental agency or court, such Registration Statement will be deemed not to have become effective during the period of such interference until the offering of Registrable Securities pursuant to such Registration Statement may legally resume.  In the event that (a) we do not consummate the Exchange Offer on or prior to the Exchange Offer Closing Deadline or (b) a Shelf Registration Statement is not declared effective on or prior to 90 days after the Shelf Filing Obligation arises (which shall in no event be earlier than the Exchange Offer Closing Deadline) (the “Effectiveness Deadline”), the annual interest rate on the Registrable Securities will be increased by 0.50% from the Exchange Offer Closing Deadline or the Effectiveness Deadline, as applicable, until the Exchange Offer is completed, in the case of an Exchange Offer, or the Shelf Registration Statement is declared effective by the SEC.  The annual additional interest rate on the Registrable Securities will not at any time exceed 0.50%

 

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notwithstanding the Issuer’s failure to meet more than one of these requirements.  If the Issuer requests Holders of Registrable Securities to provide the information as described in Section 3(q), the Registrable Securities held by Holders who do not deliver such information to the Issuer when so requested will not be entitled to any such increase in the interest rate.  The additional interest payable on the Registrable Securities described in this clause (d) shall be payable on the regular interest payment dates for the Registrable Securities.

 

(e)                                  Without limiting the remedies available to the Initial Purchasers and the Holders, the Issuer acknowledges that any failure by the Issuer to comply with its obligations under Section 2(a) and Section 2(b) hereof may result in material irreparable injury to the Initial Purchasers or the Holders for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely and that, in the event of any such failure, the Initial Purchasers or any Holder may obtain such relief as may be required to specifically enforce the Issuer’s obligations under Section 2(a) and Section 2(b) hereof.

 

3.                                       Registration Procedures.

 

In connection with the obligations of the Issuer with respect to the Registration Statements pursuant to Section 2(a) and Section 2(b) hereof, the Issuer shall as expeditiously as possible:

 

(a)                                  prepare and file with the SEC a Registration Statement on the appropriate form under the 1933 Act, which form (x) shall be selected by the Issuer and (y) shall, in the case of a Shelf Registration, be available for the sale of the Registrable Securities by the selling Holders thereof and (z) shall comply as to form in all material respects with the requirements of the applicable form and include all financial statements required by the SEC to be filed therewith, and use its reasonable best efforts to cause such Registration Statement to become effective and remain effective in accordance with Section 2 hereof;

 

(b)                                 prepare and file with the SEC such amendments and post-effective amendments to each Registration Statement as may be necessary to keep such Registration Statement effective for the applicable period and cause each Prospectus to be supplemented by any required prospectus supplement and, as so supplemented, to be filed pursuant to Rule 424 under the 1933 Act; to keep each Prospectus current during the period described under Section 4(3) and Rule 174 under the 1933 Act that is applicable to transactions by brokers or dealers with respect to the Registrable Securities or Exchange Securities;

 

(c)                                  in the case of a Shelf Registration, furnish to each Holder of Registrable Securities, to the Initial Purchasers, to counsel for the Holders and to each Underwriter of an Underwritten Offering of Registrable Securities, if any, without charge, as many copies of each Prospectus, including each preliminary Prospectus, and any amendment or supplement thereto and such other documents as such Holder or Underwriter may reasonably request, in order to facilitate the public sale or other disposition of the Registrable Securities; and the Issuer consents to the use of such Prospectus and any amendment or supplement thereto in accordance with applicable law by each of the

 

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selling Holders of Registrable Securities and any such Underwriters in connection with the offering and sale of the Registrable Securities covered by and in the manner described in such Prospectus or any amendment or supplement thereto in accordance with applicable law;

 

(d)                                 use its reasonable best efforts to register or qualify the Registrable Securities under all applicable state securities or “blue sky” laws of such jurisdictions as any Holder of Registrable Securities covered by a Registration Statement shall reasonably request in writing by the time the applicable Registration Statement is declared effective by the SEC, to cooperate with such Holders in connection with any filings required to be made with FINRA and do any and all other acts and things which may be reasonably necessary or advisable to enable such Holder to consummate the disposition in each such jurisdiction of such Registrable Securities owned by such Holder; provided, however, that the Issuer shall not be required to (i) qualify as a foreign corporation or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(d), (ii) file any general consent to service of process or (iii) subject itself to taxation in any such jurisdiction if it is not so subject;

 

(e)                                  in the case of a Shelf Registration, notify each Holder of Registrable Securities, counsel for the Holders and counsel for the Initial Purchasers promptly and, if requested by any such Holder or counsel, confirm such advice in writing (i) when a Registration Statement has become effective and when any post-effective amendment thereto has been filed and becomes effective, (ii) of any request by the SEC or any state securities authority for amendments and supplements to a Registration Statement and Prospectus or for additional information after the Registration Statement has become effective, (iii) of the issuance by the SEC or any state securities authority of any stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that purpose, (iv) if, between the effective date of a Registration Statement and the closing of any sale of Registrable Securities covered thereby, the representations and warranties of the Issuer contained in any underwriting agreement, securities sales agreement or other similar agreement, if any, relating to the offering cease to be true and correct in all material respects or if the Issuer receives any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation of any proceeding for such purpose, (v) of the happening of any event during the period a Shelf Registration Statement is effective which makes any statement made in such Registration Statement or the related Prospectus, in the case of the Prospectus, in light of the circumstances under which they were made, untrue in any material respect or which requires the making of any changes in such Registration Statement or Prospectus in order to make the statements therein, in the case of the Prospectus, in light of the circumstances under which they were made, not misleading and (vi) of any determination by the Issuer that a post-effective amendment to a Registration Statement would be appropriate;

 

(f)                                    make every reasonable effort to obtain the withdrawal of any order suspending the effectiveness of a Registration Statement at the earliest possible moment and provide immediate notice to each Holder of the withdrawal of any such order;

 

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(g)                                 in the case of a Shelf Registration, furnish to each Holder of Registrable Securities, without charge, at least one conformed copy of each Registration Statement and any post-effective amendment thereto (without documents incorporated therein by reference or exhibits thereto, unless requested);

 

(h)                                 in the case of a Shelf Registration, cooperate with the selling Holders of Registrable Securities to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold and not bearing any restrictive legends and enable such Registrable Securities to be in such denominations (consistent with the provisions of the Indenture) and registered in such names as the selling Holders may reasonably request at least one business day prior to the closing of any sale of Registrable Securities;

 

(i)                                     in the case of a Shelf Registration, upon the occurrence of any event contemplated by Section 3(e)(v) hereof, use its reasonable best efforts to prepare and file with the SEC a supplement or post-effective amendment to a Registration Statement or the related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities, such Prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.  The Issuer agrees to notify the Holders to suspend use of the Prospectus as promptly as practicable after the occurrence of such an event, and the Holders hereby agree to suspend use of the Prospectus until the Issuer has amended or supplemented the Prospectus to correct such misstatement or omission;

 

(j)                                     a reasonable time prior to the filing of any Registration Statement, any Prospectus, any amendment to a Registration Statement or amendment or supplement to a Prospectus or any document which is to be incorporated by reference into a Registration Statement or a Prospectus after initial filing of a Registration Statement, provide copies of such document to the Initial Purchasers and their counsel (and, in the case of a Shelf Registration Statement, the Holders and their counsel) and make such of the representatives of the Issuer as shall be reasonably requested by the Initial Purchasers or their counsel (and, in the case of a Shelf Registration Statement, the Holders or their counsel) available for discussion of such document, and shall not at any time file or make any amendment to the Registration Statement, any Prospectus or any amendment of or supplement to a Registration Statement or a Prospectus or any document which is to be incorporated by reference into a Registration Statement or a Prospectus, of which the Initial Purchasers and their counsel (and, in the case of a Shelf Registration Statement, the Holders and their counsel) shall not have previously been advised and furnished a copy or to which the Initial Purchasers or their counsel (and, in the case of a Shelf Registration Statement, the Holders or their counsel) shall object, except for any amendment or supplement or document (a copy of which has been previously furnished to the Initial Purchasers and its counsel (and, in the case of a Shelf Registration Statement, the Holders and their counsel)) which counsel to the Issuer shall advise the Issuer in writing is required in order to comply with applicable law;

 

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(k)                                 obtain a CUSIP number for all Exchange Securities or Registrable Securities, as the case may be, not later than the effective date of a Registration Statement;

 

(l)                                     cause the Indenture to be qualified under the Trust Indenture Act of 1939, as amended (the “TIA”), in connection with the registration of the Exchange Securities or Registrable Securities, as the case may be, cooperate with the Trustee and the Holders to effect such changes to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the TIA and execute, and use its reasonable best efforts to cause the Trustee to execute, all documents as may be required to effect such changes and all other forms and documents required to be filed with the SEC to enable the Indenture to be so qualified in a timely manner;

 

(m)                             in the case of a Shelf Registration, make available for inspection by a representative of the Holders of the Registrable Securities, any Underwriter participating in any disposition pursuant to such Shelf Registration Statement, and attorneys and accountants designated by the Holders, at reasonable times and in a reasonable manner, all financial and other records, pertinent documents and properties of the Issuer, and cause the respective officers, directors and employees of the Issuer to supply all information reasonably requested by any such representative, Underwriter, attorney or accountant in connection with a Shelf Registration Statement;

 

(n)                                 in the case of a Shelf Registration, use its reasonable best efforts to cause all Registrable Securities to be listed on any securities exchange or any automated quotation system on which similar securities issued by the Issuer are then listed if requested by the Majority Holders, to the extent such Registrable Securities satisfy applicable listing requirements;

 

(o)                                 use its reasonable best efforts to cause the Exchange Securities to continue to be rated by two nationally recognized statistical rating organizations (as such term is defined in Section 3(a)(62) of the 1934 Act), if the Registrable Securities have been rated;

 

(p)                                 if reasonably requested by any Holder of Registrable Securities covered by a Registration Statement, (i) promptly incorporate in a Prospectus supplement or post-effective amendment such information with respect to such Holder as such Holder reasonably requests to be included therein and (ii) make all required filings of such Prospectus supplement or such post-effective amendment as soon as the Issuer has received notification of the matters to be incorporated in such filing; and

 

(q)                                 in the case of a Shelf Registration, enter into such customary agreements and take all such other actions in connection therewith (including those requested by the Holders of a majority of the Registrable Securities being sold) in order to expedite or facilitate the disposition of such Registrable Securities including, but not limited to, an Underwritten Offering and in such connection, (i) to the extent possible, make such representations and warranties to the Holders and any Underwriters of such Registrable Securities with respect to the business of the Issuer and its subsidiaries, the Registration

 

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Statement, Prospectus and documents incorporated by reference or deemed incorporated by reference, if any, in each case, in form, substance and scope as are customarily made by issuers to underwriters in underwritten offerings and confirm the same if and when requested, (ii) obtain opinions of counsel to the Issuer (which counsel and opinions, in form, scope and substance, shall be reasonably satisfactory to the Holders and such Underwriters and their respective counsel) addressed to each selling Holder and Underwriter of Registrable Securities, covering the matters customarily covered in opinions requested in underwritten offerings, (iii) obtain “cold comfort” letters from the independent certified public accountants of the Issuer (and, if necessary, any other certified public accountant of any subsidiary of the Issuer, or of any business acquired by the Issuer for which financial statements and financial data are or are required to be included in the Registration Statement) addressed to each selling Holder and Underwriter of Registrable Securities, such letters to be in customary form and covering matters of the type customarily covered in “cold comfort” letters in connection with underwritten offerings, and (iv) deliver such documents and certificates as may be reasonably requested by the Holders of a majority in principal amount of the Registrable Securities being sold or the Underwriters, and which are customarily delivered in underwritten offerings, to evidence the continued validity of the representations and warranties of the Issuer made pursuant to clause (i) above and to evidence compliance with any customary conditions contained in an underwriting agreement.

 

In the case of a Shelf Registration Statement, the Issuer may require each Holder of Registrable Securities to furnish to the Issuer such information regarding the Holder and the proposed distribution by such Holder of such Registrable Securities as the Issuer may from time to time reasonably request in writing.  The Issuer will not have any obligation to include in the Shelf Registration Statement any Holder that does not deliver such information to the Issuer.

 

In the case of a Shelf Registration Statement, each Holder agrees that, upon receipt of any notice from the Issuer of the happening of any event of the kind described in Section 3(e)(v) hereof, such Holder will forthwith discontinue disposition of Registrable Securities pursuant to a Registration Statement until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 3(i) hereof, and, if so directed by the Issuer, such Holder will deliver to the Issuer (at its expense) all copies in its possession, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Registrable Securities current at the time of receipt of such notice.  If the Issuer shall give any such notice to suspend the disposition of Registrable Securities pursuant to a Registration Statement, the Issuer shall extend the period during which the Registration Statement shall be maintained effective pursuant to this Agreement by the number of days during the period from and including the date of the giving of such notice to and including the date when the Holders shall have received copies of the supplemented or amended Prospectus necessary to resume such dispositions.  The Issuer may give any such notice only twice during any 365 day period and any such suspensions may not exceed 30 days for each suspension and there may not be more than two suspensions in effect during any 365 day period.

 

The Holders of Registrable Securities covered by a Shelf Registration Statement who desire to do so may sell such Registrable Securities in an Underwritten Offering.  In any such Underwritten Offering, the investment banker or investment bankers and manager or

 

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managers (the “Underwriters”) that will administer the offering will be selected by the Majority Holders of the Registrable Securities included in such offering.

 

4.                                      Participation of Broker-Dealers in Exchange Offer.

 

(a)                                 The Staff of the SEC has taken the position that any broker-dealer that receives Exchange Securities for its own account in the Exchange Offer in exchange for Securities that were acquired by such broker-dealer as a result of market-making or other trading activities (a “Participating Broker-Dealer”), may be deemed to be an “underwriter” within the meaning of the 1933 Act and must deliver a prospectus meeting the requirements of the 1933 Act in connection with any resale of such Exchange Securities.

 

The Issuer understands that it is the Staff’s position that if the Prospectus contained in the Exchange Offer Registration Statement includes a plan of distribution containing a statement to the above effect and the means by which Participating Broker-Dealers may resell the Exchange Securities, without naming the Participating Broker-Dealers or specifying the amount of Exchange Securities owned by them, such Prospectus may be delivered by Participating Broker-Dealers to satisfy their prospectus delivery obligation under the 1933 Act in connection with resales of Exchange Securities for their own accounts, so long as the Prospectus otherwise meets the requirements of the 1933 Act.

 

(b)                                 In light of the above, notwithstanding the other provisions of this Agreement, the Issuer agrees that the provisions of this Agreement as they relate to a Shelf Registration shall also apply to an Exchange Offer Registration to the extent, and with such reasonable modifications thereto as may be, reasonably requested by the Initial Purchasers or by one or more Participating Broker-Dealers, in each case as provided in clause (ii) below, in order to expedite or facilitate the disposition of any Exchange Securities by Participating Broker-Dealers consistent with the positions of the Staff recited in Section 4(a) above; provided that:

 

(i)                                     the Issuer shall not be required to amend or supplement the Prospectus contained in the Exchange Offer Registration Statement, as would otherwise be contemplated by Section 3(i), for a period exceeding 180 days after the last Exchange Date (as such period may be extended pursuant to the penultimate paragraph of Section 3 of this Agreement) and Participating Broker-Dealers shall not be authorized by the Issuer to deliver and shall not deliver such Prospectus after such period in connection with the resales contemplated by this Section 4; and

 

(ii)                                  the application of the Shelf Registration procedures set forth in Section 3 of this Agreement to an Exchange Offer Registration, to the extent not required by the positions of the Staff of the SEC or the 1933 Act and the rules and regulations thereunder, will be in conformity with the reasonable request to the Issuer by the Initial Purchasers or with the reasonable request in writing to the Issuer by one or more broker-dealers who certify to the Initial Purchasers and the Issuer in writing that they anticipate that they will be Participating Broker-Dealers; and provided  further that, in connection with such application of the Shelf Registration procedures set forth in Section 3 to an Exchange Offer Registration, the Issuer shall be obligated (x) to deal only with one entity representing the Participating Broker-Dealers, which shall be Merrill Lynch, Pierce,

 

12

 

Fenner & Smith Incorporated unless it elects not to act as such representative, (y) to pay the fees and expenses of only one counsel representing the Participating Broker-Dealers, which shall be counsel to the Initial Purchasers unless such counsel elects not to so act and (z) to cause to be delivered only one, if any, “cold comfort” letter with respect to the Prospectus in the form existing on the last Exchange Date and with respect to each subsequent amendment or supplement, if any, effected during the period specified in clause (i) above.

 

(c)                                  The Initial Purchasers shall have no liability to the Issuer or any Holder with respect to any request that it may make pursuant to Section 4(b) above.

 

5.                                      Indemnification and Contribution.

 

(a)                                 The Issuer agrees to indemnify and hold harmless (i) the Initial Purchasers, each Holder, (ii) each Person, if any, who controls any Initial Purchaser or any Holder within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, or is under common control with, or is controlled by, any Initial Purchaser or any Holder (any such persons being hereinafter referred to as a “controlling person”) and (iii) the affiliates (as such term is defined in Rule 501(b) under the 1933 Act, each an “Affiliate”) and agents of any Initial Purchaser, Holder or any controlling person (any person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”), from and against all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred by an Indemnified Holder in connection with defending or investigating any such action or claim) incurred, arising out of or caused by any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement (or any amendment thereto) pursuant to which Exchange Securities or Registrable Securities were registered under the 1933 Act, including all documents incorporated therein by reference, or incurred, arising out of or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or incurred, arising out of or caused by any untrue statement or alleged untrue statement of a material fact contained in any Prospectus (as amended or supplemented if the Issuer shall have furnished any amendments or supplements thereto), or incurred, arising out of or caused by any omission or alleged omission to state therein a material fact necessary to make the statements therein in light of the circumstances under which they were made not misleading, except insofar as such losses, claims, damages or liabilities are incurred, arising out of or caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to the Initial Purchasers or any Holder furnished to the Issuer in writing through Merrill Lynch, Pierce, Fenner & Smith Incorporated or any selling Holder expressly for use therein.  In connection with any Underwritten Offering permitted by Section 3, the Issuer will also indemnify the Underwriters, if any, selling brokers, dealers and similar securities industry professionals participating in the distribution, their officers and directors and each Person who controls such Persons (within the meaning of the 1933 Act and the 1934 Act) to the same extent as provided above with respect to the indemnification of the Holders, if requested in connection with any Registration Statement.

 

(b)                                 Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Issuer, the Initial Purchasers and the other selling Holders, and each of their respective directors, officers who sign the Registration Statement and each Person, if any, who

 

13

 

controls the Issuer, any Initial Purchasers and any other selling Holder within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act to the same extent as the foregoing indemnity from the Issuer to the Initial Purchasers and the Holders, but only with reference to information relating to such Holder furnished to the Issuer in writing by such Holder expressly for use in any Registration Statement (or any amendment thereto) or any Prospectus (or any amendment or supplement thereto).

 

(c)                                  In case any proceeding (including any governmental investigation) shall be instituted involving any Person in respect of which indemnity may be sought pursuant to either paragraph (a) or paragraph (b) above, such Person (the “indemnified party”) shall promptly notify the Person against whom such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding.  In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them.  It is understood that the indemnifying party shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for (a) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Initial Purchasers, all controlling persons of any Initial Purchaser and all Affiliates of any Initial Purchaser (b) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Issuer, its directors, its officers who sign the Registration Statement and each Person, if any, who controls the Issuer within the meaning of either such Section and (c) the fees and expenses of more than one separate firm (in addition to any local counsel) for all Holders, all controlling persons of any Holders and all Affiliates of any Holder and that all such fees and expenses shall be reimbursed as they are incurred.  In such case involving the Initial Purchasers, controlling persons of any Initial Purchaser and all Affiliates of any Initial Purchaser, such firm shall be designated in writing by Merrill Lynch, Pierce, Fenner & Smith Incorporated.  In such case involving the Holders and such controlling persons of Holders and Affiliates of any Holder, such firm shall be designated in writing by the Majority Holders.  In all other cases, such firm shall be designated by the Issuer.  The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent but, if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment.  Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party for such fees and expenses of counsel in accordance with such request prior to the date of such settlement.  No indemnifying party shall, without the prior written consent of the indemnified party, effect any

 

14

 

settlement of any pending or threatened proceeding in respect of which such indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

 

(d)                                 If the indemnification provided for in paragraph (a) or paragraph (b) of this Section 5 is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities in such proportion as is appropriate to reflect the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or parties on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations.  The relative fault of the Issuer and the Indemnified Holders shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Issuer or by the Indemnified Holders and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The Holders’ respective obligations to contribute pursuant to this Section 5(d) are several in proportion to the respective principal amount of Registrable Securities of such Holder that were registered pursuant to a Registration Statement.

 

(e)                                  The Issuer and each Holder agree that it would not be just or equitable if contribution pursuant to this Section 5 were determined by pro  rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above.  The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 5, no Holder (and its related Indemnified Holders) shall be required to indemnify or contribute any amount in excess of the amount by which the total price at which Registrable Securities were sold by such Holder exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.  No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.  The Holders’ respective obligations to contribute pursuant to this Section 5(e) are several in proportion to the respective principal amount of Registrable Securities of such Holder that were registered pursuant to a Registration Statement.  The remedies provided for in this Section 5 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

 

The indemnity and contribution provisions contained in this Section 5 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Indemnified Holder, or by or on behalf of the

 

15

 

Issuer, its officers or directors or any Person controlling the Issuer, (iii) acceptance of any of the Exchange Securities and (iv) any sale of Registrable Securities pursuant to a Shelf Registration Statement.

 

6.                                      Miscellaneous.

 

(a)                                 No Inconsistent Agreements.  The Issuer has not entered into, and on or after the date of this Agreement will not enter into, any agreement which is inconsistent with the rights granted to the Holders of Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof.  The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Issuer’s other issued and outstanding securities under any such agreements.

 

(b)                                 Amendments and Waivers.  The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given unless the Issuer has obtained the written consent of Holders of at least a majority in aggregate principal amount of the outstanding Registrable Securities affected by such amendment, modification, supplement, waiver or consent; provided, however, that no amendment, modification, supplement, waiver or consent to any departure from the provisions of Section 5 hereof shall be effective as against any Holder of Registrable Securities unless consented to in writing by such Holder.

 

(c)                                  Notices.  All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, registered first-class mail, telex, telecopier, or any courier guaranteeing overnight delivery (i) if to a Holder, at the most current address given by such Holder to the Issuer by means of a notice given in accordance with the provisions of this Section 6(c), which address initially is, with respect to the Initial Purchasers, the address set forth in the Purchase Agreement; and (ii) if to the Issuer, initially at the Issuer’s address set forth in the Purchase Agreement and thereafter at such other address, notice of which is given in accordance with the provisions of this Section 6(c).

 

All such notices and communications shall be deemed to have been duly given:  at the time delivered by hand, if personally delivered; five business days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt is acknowledged, if telecopied; and on the next business day if timely delivered to an air courier guaranteeing overnight delivery.

 

Copies of all such notices, demands, or other communications shall be concurrently delivered by the Person giving the same to the Trustee, at the address specified in the Indenture.

 

(d)                                 Successors and Assigns.  This Agreement shall inure to the benefit of and be binding upon the successors, assigns and transferees of each of the parties, including, without limitation and without the need for an express assignment, subsequent Holders; provided that nothing herein shall be deemed to permit any assignment, transfer or other disposition of Registrable Securities in violation of the terms of the Purchase Agreement.  If any transferee of any Holder shall acquire Registrable Securities, in any manner, whether by operation of law or

 

16

 

otherwise, such Registrable Securities shall be held subject to all of the terms of this Agreement, and by taking and holding such Registrable Securities such Person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement and such Person shall be entitled to receive the benefits hereof.  The Initial Purchasers (in their capacity as Initial Purchasers) shall have no liability or obligation to the Issuer with respect to any failure by a Holder to comply with, or any breach by any Holder of, any of the obligations of such Holder under this Agreement.

 

(e)                                  Purchases and Sales of Securities.  The Issuer shall not, and shall use its reasonable best efforts to cause its affiliates (as defined in Rule 405 under the 1933 Act) not to, purchase and then resell or otherwise transfer any Securities.

 

(f)                                   Third Party Beneficiary.  The Holders shall be third party beneficiaries to the agreements made hereunder between the Issuer, on the one hand, and the Initial Purchasers, on the other hand, and shall have the right to enforce such agreements directly to the extent it deems such enforcement necessary or advisable to protect its rights or the rights of Holders hereunder.

 

(g)                                  Counterparts.  This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

 

(h)                                 Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

(i)                                     Governing Law.  This Agreement shall be governed by the laws of the State of New York.

 

(j)                                    Severability.  In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.

 

17

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

 

	
 
    	
DOLPHIN   SUBSIDIARY II, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

18

 

Confirmed and accepted as of the date first above written:

 

MERRILL LYNCH, PIERCE, FENNER & SMITH 

                                                                                                INCORPORATED

BARCLAYS CAPITAL INC.

J.P. MORGAN SECURITIES LLC
 MORGAN STANLEY & CO. LLC

BNP PARIBAS SECURITIES CORP

CREDIT AGRICOLE SECURITIES (USA) INC.

MITSUBISHI UFJ SECURITIES (USA), INC.

SCOTIA CAPITAL (USA) INC.

 

 

	
By:    MERRILL LYNCH, PIERCE, FENNER &   SMITH
    	
 
    
	
INCORPORATED
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

19

 

SCHEDULE A

 

Name of Initial Purchaser

 

Merrill Lynch, Pierce, Fenner & Smith By

                      Incorporated

Barclays Capital Inc. 
 J.P. Morgan Securities LLC
 Morgan Stanley & Co. LLC

BNP Paribas Securities Corp.

Credit Agricole Securities (USA) Inc.

Mitsubishi UFJ Securities (USA), Inc.

Scotia Capital (USA) Inc.

 

1Exhibit
10.1

 

 

 

Published CUSIP Number: 24001QAD3

 

CREDIT
AGREEMENT

 

Dated as of April 20,
2010

 

among

 

THE DAYTON POWER AND LIGHT COMPANY,

as the Borrower,

 

BANK OF
AMERICA, N.A.,

as Administrative Agent and an L/C Issuer,

 

PNC
CAPITAL MARKETS, LLC

and

U.S. BANK
NATIONAL ASSOCIATION,

as Co-Syndication
Agents

 

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

  
	
   

  	
   

  	
   

  	
   

  
	
  1.01

  	
   

  	
  Defined Terms

  	
  1

  
	
  1.02

  	
   

  	
  Other Interpretive
  Provisions

  	
  20

  
	
  1.03

  	
   

  	
  Accounting Terms

  	
  21

  
	
  1.04

  	
   

  	
  Rounding

  	
  21

  
	
  1.05

  	
   

  	
  Times of Day

  	
  21

  
	
  1.06

  	
   

  	
  Letter of Credit
  Amounts

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
   

  	
  THE
  COMMITMENTS AND CREDIT EXTENSIONS

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  2.01

  	
   

  	
  Loans

  	
  22

  
	
  2.02

  	
   

  	
  Borrowings, Conversions
  and Continuations of Loans

  	
  22

  
	
  2.03

  	
   

  	
  Letters of Credit

  	
  23

  
	
  2.04

  	
   

  	
  Prepayments

  	
  32

  
	
  2.05

  	
   

  	
  Termination or
  Reduction of Commitments

  	
  32

  
	
  2.06

  	
   

  	
  Repayment of Loans

  	
  33

  
	
  2.07

  	
   

  	
  Interest

  	
  33

  
	
  2.08

  	
   

  	
  Fees

  	
  33

  
	
  2.09

  	
   

  	
  Computation of Interest
  and Fees

  	
  34

  
	
  2.10

  	
   

  	
  Evidence of Debt

  	
  34

  
	
  2.11

  	
   

  	
  Payments Generally;
  Administrative Agent’s Clawback

  	
  35

  
	
  2.12

  	
   

  	
  Sharing of Payments by
  Lenders

  	
  36

  
	
  2.13

  	
   

  	
  Increase in Commitments

  	
  37

  
	
  2.14

  	
   

  	
  Cash Collateral

  	
  38

  
	
  2.15

  	
   

  	
  Defaulting Lenders

  	
  40

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
   

  	
  TAXES,
  YIELD PROTECTION AND ILLEGALITY

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  3.01

  	
   

  	
  Taxes

  	
  41

  
	
  3.02

  	
   

  	
  Illegality

  	
  45

  
	
  3.03

  	
   

  	
  Inability to Determine
  Rates

  	
  46

  
	
  3.04

  	
   

  	
  Increased Costs;
  Reserves on Eurodollar Rate Loans

  	
  46

  
	
  3.05

  	
   

  	
  Compensation for Losses

  	
  48

  
	
  3.06

  	
   

  	
  Mitigation Obligations;
  Replacement of Lenders

  	
  49

  
	
  3.07

  	
   

  	
  Survival

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
   

  	
  CONDITIONS
  PRECEDENT TO CREDIT EXTENSIONS

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  4.01

  	
   

  	
  Conditions of Initial
  Credit Extension

  	
  49

  
	
  4.02

  	
   

  	
  Conditions to all
  Credit Extensions

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
   

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
  5.01

  	
   

  	
  Existence,
  Qualification and Power

  	
  51

  
	
  5.02

  	
   

  	
  Authorization; No
  Contravention

  	
  51

  
	
  5.03

  	
   

  	
  Governmental
  Authorization; Other Consents

  	
  52

  
	
  5.04

  	
   

  	
  Binding Effect

  	
  52

  

 

i

 

	
  5.05

  	
   

  	
  Financial Statements;
  No Material Adverse Effect

  	
  52

  
	
  5.06

  	
   

  	
  Litigation

  	
  53

  
	
  5.07

  	
   

  	
  No Default

  	
  53

  
	
  5.08

  	
   

  	
  Ownership of Property

  	
  53

  
	
  5.09

  	
   

  	
  Environmental
  Compliance

  	
  53

  
	
  5.10

  	
   

  	
  Insurance

  	
  54

  
	
  5.11

  	
   

  	
  Taxes

  	
  54

  
	
  5.12

  	
   

  	
  ERISA Compliance

  	
  54

  
	
  5.13

  	
   

  	
  Subsidiaries

  	
  55

  
	
  5.14

  	
   

  	
  Margin Regulations;
  Investment Company Act; Federal Power Act

  	
  55

  
	
  5.15

  	
   

  	
  Disclosure

  	
  55

  
	
  5.16

  	
   

  	
  Compliance with Laws

  	
  56

  
	
  5.17

  	
   

  	
  Intellectual Property;
  Licenses, Etc

  	
  56

  
	
  5.18

  	
   

  	
  Solvency

  	
  56

  
	
  5.19

  	
   

  	
  Employment Matters

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
   

  	
  AFFIRMATIVE
  COVENANTS

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
  6.01

  	
   

  	
  Financial Statements

  	
  56

  
	
  6.02

  	
   

  	
  Certificates; Other
  Information

  	
  57

  
	
  6.03

  	
   

  	
  Notices

  	
  58

  
	
  6.04

  	
   

  	
  Payment of Taxes and
  Claims

  	
  59

  
	
  6.05

  	
   

  	
  Preservation of
  Existence, Etc

  	
  59

  
	
  6.06

  	
   

  	
  Maintenance of
  Properties

  	
  59

  
	
  6.07

  	
   

  	
  Maintenance of
  Insurance

  	
  60

  
	
  6.08

  	
   

  	
  Compliance with Laws

  	
  60

  
	
  6.09

  	
   

  	
  Books and Records

  	
  60

  
	
  6.10

  	
   

  	
  Inspection Rights

  	
  60

  
	
  6.11

  	
   

  	
  Use of Proceeds

  	
  60

  
	
  6.12

  	
   

  	
  Senior Debt

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII.

  	
   

  	
  NEGATIVE
  COVENANTS

  	
  61

  
	
   

  	
   

  	
   

  	
   

  
	
  7.01

  	
   

  	
  Liens

  	
  61

  
	
  7.02

  	
   

  	
  Investments

  	
  63

  
	
  7.03

  	
   

  	
  Fundamental Changes

  	
  64

  
	
  7.04

  	
   

  	
  Dispositions

  	
  64

  
	
  7.05

  	
   

  	
  Change in Nature of
  Business

  	
  65

  
	
  7.06

  	
   

  	
  Transactions with
  Affiliates

  	
  65

  
	
  7.07

  	
   

  	
  Burdensome Agreements

  	
  65

  
	
  7.08

  	
   

  	
  Swap Agreements

  	
  65

  
	
  7.09

  	
   

  	
  Use of Proceeds

  	
  65

  
	
  7.10

  	
   

  	
  Accounting Changes

  	
  65

  
	
  7.11

  	
   

  	
  Financial Covenant

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII.

  	
   

  	
  EVENTS
  OF DEFAULT AND REMEDIES

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
  8.01

  	
   

  	
  Events of Default

  	
  66

  
	
  8.02

  	
   

  	
  Remedies Upon Event of
  Default

  	
  68

  
	
  8.03

  	
   

  	
  Application of Funds

  	
  68

  

 

ii

 

	
  ARTICLE IX.

  	
   

  	
  ADMINISTRATIVE
  AGENT

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
  9.01

  	
   

  	
  Appointment and
  Authority

  	
  69

  
	
  9.02

  	
   

  	
  Rights as a Lender

  	
  69

  
	
  9.03

  	
   

  	
  Exculpatory Provisions

  	
  70

  
	
  9.04

  	
   

  	
  Reliance by
  Administrative Agent

  	
  70

  
	
  9.05

  	
   

  	
  Delegation of Duties

  	
  71

  
	
  9.06

  	
   

  	
  Resignation of
  Administrative Agent

  	
  71

  
	
  9.07

  	
   

  	
  Non-Reliance on
  Administrative Agent and Other Lenders

  	
  72

  
	
  9.08

  	
   

  	
  No Other Duties, Etc

  	
  72

  
	
  9.09

  	
   

  	
  Administrative Agent
  May File Proofs of Claim

  	
  72

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X.

  	
   

  	
  MISCELLANEOUS

  	
  73

  
	
   

  	
   

  	
   

  	
   

  
	
  10.01

  	
   

  	
  Amendments, Etc

  	
  73

  
	
  10.02

  	
   

  	
  Notices; Effectiveness;
  Electronic Communication

  	
  74

  
	
  10.03

  	
   

  	
  No Waiver; Cumulative
  Remedies; Enforcement

  	
  76

  
	
  10.04

  	
   

  	
  Expenses; Indemnity;
  Damage Waiver

  	
  77

  
	
  10.05

  	
   

  	
  Payments Set Aside

  	
  79

  
	
  10.06

  	
   

  	
  Successors and Assigns

  	
  79

  
	
  10.07

  	
   

  	
  Treatment of Certain
  Information; Confidentiality

  	
  83

  
	
  10.08

  	
   

  	
  Right of Setoff

  	
  84

  
	
  10.09

  	
   

  	
  Interest Rate
  Limitation

  	
  85

  
	
  10.10

  	
   

  	
  Counterparts;
  Integration; Effectiveness

  	
  85

  
	
  10.11

  	
   

  	
  Survival of
  Representations and Warranties

  	
  85

  
	
  10.12

  	
   

  	
  Severability

  	
  86

  
	
  10.13

  	
   

  	
  Replacement of Lenders

  	
  86

  
	
  10.14

  	
   

  	
  Governing Law;
  Jurisdiction; Etc

  	
  87

  
	
  10.15

  	
   

  	
  Waiver of Jury Trial

  	
  88

  
	
  10.16

  	
   

  	
  No Advisory or
  Fiduciary Responsibility

  	
  88

  
	
  10.17

  	
   

  	
  Electronic Execution of
  Assignments and Certain Other Documents

  	
  89

  
	
  10.18

  	
   

  	
  USA PATRIOT Act

  	
  89

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNATURES

  	
  S-1

  

 

iii

 

	
  SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  2.01

  	
   

  	
  Commitments and
  Applicable Percentages

  
	
  7.01

  	
   

  	
  Existing Liens

  
	
  7.02

  	
   

  	
  Existing Investments

  
	
  10.02

  	
   

  	
  Administrative Agent’s
  Office; Certain Addresses for Notices

  

 

	
  EXHIBITS

  	
   

  	
   

  
	
   

  	
   

  	
  Form of

  
	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Loan Notice

  
	
  B

  	
   

  	
  Note

  
	
  C

  	
   

  	
  Compliance Certificate

  
	
  D-1

  	
   

  	
  Assignment and
  Assumption

  
	
  D-2

  	
   

  	
  Administrative Questionnaire

  
	
  E

  	
   

  	
  Opinions

  
	
  F

  	
   

  	
  Report of Letter of
  Credit Information

  

 

iv

 

CREDIT AGREEMENT

 

This CREDIT
AGREEMENT (as may by hereafter amended, supplemented or otherwise modified from
time to time, the “Agreement”) is entered into as of April 20,
2010, among THE DAYTON POWER AND LIGHT COMPANY,  an
Ohio 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 and an L/C Issuer.

 

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:

 

“Acquisition” means any acquisition (a) on a going concern
basis (whether by purchase, lease or otherwise) of assets constituting a
business or a division or line of business of a Person that is not a Subsidiary
of the Borrower or (b) of a majority of the outstanding Equity Interests
in any such Person (whether by merger, stock purchase or otherwise).

 

“Act” has the meaning specified in Section 10.18.

 

“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 the
Borrower and the Lenders.

 

“Administrative
Questionnaire” means an Administrative Questionnaire in substantially the
form of Exhibit D-2 or any other form approved 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.

 

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

 

“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, subject to adjustment as
provided in Section 2.15.  If
the

 

1

 

commitment of each Lender
to make Loans and the obligation of each L/C Issuer to make L/C Credit
Extensions have 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 Ratings as set forth below:

 

Applicable
Rate

 

	
  Pricing

  Level

  	
   

  	
  Ratings

  S&P/Moody’s/Fitch

  	
   

  	
  Commitment

  Fee

  	
   

  	
  Eurodollar

  Rate + /

  Letters of

  Credit

  	
   

  	
  Base Rate +

  	
   

  
	
  1

  	
   

  	
  AA-/Aa3/AA- or better

  	
   

  	
  0.125

  	
  %

  	
  1.000

  	
  %

  	
  0.000

  	
  %

  
	
  2

  	
   

  	
  A+/A1/A+

  	
   

  	
  0.150

  	
  %

  	
  1.250

  	
  %

  	
  0.250

  	
  %

  
	
  3

  	
   

  	
  A/A2/A

  	
   

  	
  0.175

  	
  %

  	
  1.500

  	
  %

  	
  0.500

  	
  %

  
	
  4

  	
   

  	
  A-/A3/A-

  	
   

  	
  0.250

  	
  %

  	
  1.750

  	
  %

  	
  0.750

  	
  %

  
	
  5

  	
   

  	
  BBB+/Baa1/BBB+ or worse

  	
   

  	
  0.350

  	
  %

  	
  2.250

  	
  %

  	
  1.250

  	
  %

  

 

If each of the
respective Ratings issued by the Rating Agencies differs by at least one level,
then the Pricing Level for the intermediate of such Ratings shall apply.  If two of the Rating Agencies issue a Rating
at the same level and one of the Rating Agencies issues a Rating at a different
level, then the Pricing Level for the Ratings at the same level shall
apply.  If only two of the Rating
Agencies issue a Rating and there is a split in Ratings of more than one level,
then the intermediate Pricing Level that is the midpoint between the two
Ratings shall apply (or if there is no midpoint, then the highest intermediate
Pricing Level shall apply (with the Rating for Pricing Level 1 being the
highest and the Rating for Pricing Level 5 being the lowest)).  If only two of the Rating Agencies issue a
Rating and such Ratings differ by one level, then the Pricing Level for the
higher of such Ratings shall apply.  If
the Borrower has only one Rating, the Pricing Level for such Rating shall
apply.  If the Borrower does not have any
Rating, Pricing Level 5 shall apply.

 

Initially, the Applicable
Rate shall be determined based upon the Ratings 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 any 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.  Notwithstanding the
foregoing, at any time that an Event of Default exists, Pricing Level 5 shall
apply.

 

“Approved Fund”
means any Fund that is administered or managed by (a) a Lender (other than
any Defaulting Lender), (b) an Affiliate of a Lender (other than any
Defaulting

 

2

 

Lender) or (c) an
entity or an Affiliate of an entity that administers or manages a Lender (other
than any Defaulting Lender).

 

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

 

“Assignment and
Assumption” means an assignment and assumption entered into by a Lender and
an 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-1
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, 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 condensed consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal year ended December 31,
2009, and the related consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal year of the Borrower and
its Subsidiaries, 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 2.05, and (c) the
date of termination of the commitment of each Lender to make Loans and of the
obligation of each L/C Issuer to make L/C Credit Extensions 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 on such date plus 1/2 of 1%, (b) the rate of interest in effect for
such day as publicly announced from time to time by Bank of America as its “prime
rate,” and (c) the Eurodollar Rate plus 1%.  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
prime 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.

 

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

 

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

 

3

 

“Borrowing” means a borrowing consisting of simultaneous Loans
of the same Type and, in the case of Eurodollar Rate Loans, having the same
Interest Period 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 or required to close under
the Laws of, or are in fact closed in, the state where the Administrative Agent’s
Office is located and, if such day relates to any Eurodollar Rate Loan, means any
such day that is also a London Banking Day.

 

“Capital Lease” means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by such Person, as lessee, that,
in conformity with GAAP, is accounted for as a capital lease on the balance
sheet of that Person.

 

“Capitalized Lease Obligations” means
all obligations under Capital Leases of the Borrower or any of its Subsidiaries
in each case taken at the amount thereof accounted for as liabilities and
identified as “capital lease obligations” (or any similar words) on a
consolidated balance sheet of the Borrower and its Subsidiaries prepared in
accordance with GAAP.

 

“Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the Administrative Agent, the L/C
Issuers and the Lenders, (a) as collateral for L/C Obligations or obligations of
Lenders to fund participations in respect of either thereof (as the context may
require), cash or deposit account balances or (b) as credit support for
L/C Obligations or obligations of Lenders to fund participations in respect of
either thereof (as the context may require), if the applicable L/C Issuer
benefitting from such credit support shall agree in its sole discretion, a
letter of credit, cash deposit or other credit support, in the case of each of
clause (a) and (b), pursuant to documentation in form and substance
reasonably satisfactory to the Administrative Agent and the applicable L/C
Issuer.  “Cash Collateral” shall have a
meaning correlative to the foregoing and shall include the proceeds of such
cash collateral and other credit support.

 

“Change in Law” means, as to any Person, 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 directive by any Governmental Authority, which in each case is
binding upon such Person or to which such Person is subject.

 

“Change of Control” means:

 

(a)           any “person” or “group”
(as such terms are used in Sections 13(d) and 14(d) of the Exchange
Act, 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 Exchange Act, 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 20% or more of the 

 

4

 

equity securities
of the Parent entitled to vote for members of the board of directors or
equivalent governing body of the Parent 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);

 

(b)           during any period of 12
consecutive months, a majority of the members (excluding vacancies) of the
board of directors or other equivalent governing body of the Parent 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 ; or

 

(c)           the Parent shall cease
to own, free and clear of all Liens and other encumbrances and on a fully
diluted basis, 100% of the outstanding shares of all classes of stock of the
Borrower ordinarily having the right to vote at an election of directors, or
any contingency shall occur that causes any class of stock of the Borrower, the
shares of which are not owned by the Parent, to have the right to vote at an
election of directors.

 

“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, as amended.

 

“Commitment” means, as to each Lender, its obligation to (a) make
Loans to the Borrower pursuant to Section 2.01 and (b) purchase
participations in L/C Obligations, 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 Net Income” means, for any period, for the
Borrower and its Subsidiaries on a consolidated basis, the net income (or
loss), without deduction for minority interests, of the Borrower and its
Subsidiaries for that period determined in conformity with GAAP.

 

“Consolidated Net Worth” means, as of any date of determination,
for the Borrower and its Subsidiaries on a consolidated basis, all amounts
that, in conformity with GAAP, would be included under the caption “total
stockholders’ equity” (or any like caption) on a consolidated balance sheet of
the Borrower and its Subsidiaries as of such date; provided that in no event shall Consolidated Net Worth
include any amounts in respect of Redeemable Stock.

 

“Consolidated Tangible Assets” means , as of any date of
determination, for the Borrower and its Subsidiaries on a consolidated basis,
the consolidated total assets of the 

 

5

 

Borrower and its Subsidiaries calculated on a
consolidated basis as of such date, but excluding therefrom goodwill, patents,
patent applications, permits, trademarks, trade names, copyrights, licenses,
franchises, experimental expense, organizational expense, unamortized debt
discount and expense, the excess of cost of shares acquired over book value of
related assets and such other assets that are properly classified as “intangible
assets” in accordance with GAAP.

 

“Consolidated Total Capitalization” means, as of any date of
determination, the sum of Consolidated Total Debt and Consolidated Net Worth
and, to the extent not otherwise included, preferred stock of the Borrower.

 

“Consolidated Total Debt” means, as of any date of
determination, for the Borrower and its Subsidiaries on a consolidated basis,
the sum (without duplication) of all Indebtedness of the Borrower and of each
of its Subsidiaries.

 

“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.

 

“Credit Extension” means each of the following: (a) a
Borrowing and (b) an L/C Credit Extension.

 

“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 (a) when used with respect to
Obligations other than Letter of Credit Fees, an interest rate equal to (i) the
Base Rate plus (ii) the Applicable Rate, if any, applicable to Base
Rate Loans plus (iii) 2% per annum; provided, however,
that with respect to a Eurodollar Rate Loan, the Default Rate shall be an
interest rate equal to the interest rate (including any Applicable Rate)
otherwise applicable to such Loan plus 2% per annum, and (b) when used
with respect to Letter of Credit Fees, a rate equal to the Applicable Rate plus
2% per annum.

 

“Defaulting Lender” means, subject to Section 2.15(b),
any Lender that, as may be determined by the Administrative Agent, (a) has
failed to perform any of its funding or other payment obligations hereunder,
including in respect of its Loans or participations in respect of Letters of
Credit, within two Business Days of the date required to be funded by it
hereunder, (b) has notified the Borrower, the Administrative Agent or any
Lender that it does not intend to 

 

6

 

comply with its funding
obligations or has made a public statement to that effect with respect to its
funding obligations hereunder or under other agreements in which it commits to
extend credit, (c) has failed, within three Business Days after request by
the Administrative Agent, to confirm in a manner satisfactory to the
Administrative Agent that it will comply with its funding obligations, or (d) has,
or has a direct or indirect parent company that has, (i) become the
subject of a proceeding under any Debtor Relief Law, (ii) had a receiver,
conservator, trustee, administrator, assignee for the benefit of creditors or
similar Person charged with reorganization or liquidation of its business or a
custodian appointed for it, or (iii) taken any action in furtherance of,
or indicated its consent to, approval of or acquiescence in any such proceeding
or appointment; provided that a Lender shall not be a Defaulting Lender
solely by virtue of the ownership or acquisition of any equity interest in that
Lender or any direct or indirect parent company thereof by a Governmental
Authority; it being understood that if a Lender or any direct or indirect
parent company thereof has been turned over to the FDIC (or a similar
Governmental Authority) for the purposes of sale or liquidation it shall be a
Defaulting Lender.

 

“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; provided that
the term “Disposition” or “Dispose” shall not include any loss or damage to, or
any condemnation or taking of, any property.

 

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

 

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

 

“Energy-Related Business” means any
business engaged in or directly related to:  (a) the production,
sale, brokerage, management, transportation, delivery or other provision of
energy products, including but not limited to, electricity, natural gas, oil,
coal, propane and renewable energy producing materials; (b) the provision
of energy conservation services, including, but not limited to, energy audits,
installation of energy conservation devices, energy efficient equipment and
related systems; (c) the provision of services and equipment in connection
with the procurement of such energy products or conservation of energy; (d) engineering,
consulting, construction, operational or maintenance services in connection
with such energy products, the conservation of energy or with equipment
utilizing such energy products; or (e) the manufacturing of equipment used
in connection with energy production or conservation.

 

“Environmental Laws” means any and all applicable Federal, state, local,
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
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 Materials, 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

 

7

 

Borrower or any of its
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 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 such Person, all of the warrants, options or other
rights for the purchase or acquisition from such Person of such shares of
capital stock of such Person, and all of the other ownership 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, as amended.

 

“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) the withdrawal of the Borrower or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan year in
which such entity 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) the assessment of withdrawal liability under Title IV of ERISA
upon the Borrower or any ERISA Affiliate in connection with the Borrower’s or
any ERISA Affiliate’s complete or partial withdrawal from a Multiemployer Plan
or the Borrower’s or any ERISA Affiliate’s notification that a Multiemployer
Plan is in reorganization; (d) the filing of a notice of intent to
terminate or the treatment of a Pension Plan amendment as a termination under Section 4041
or 4041A of ERISA; (e) the institution by the PBGC of proceedings to
terminate a Pension Plan; (f) any 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; (g) the
determination that any Pension Plan is considered an at-risk plan or a plan in
endangered or critical status within the meaning of Sections 430, 431 and 432
of the Code or Sections 303, 304 and 305 of ERISA; or (h) the imposition
of any liability under Title IV of ERISA upon the Borrower or any ERISA
Affiliate, other than for PBGC premiums due but not delinquent under Section 4007
of ERISA.

 

“Eurodollar Rate” means:

 

(a)           for any Interest Period with respect to a Eurodollar
Rate Loan, the rate per annum equal to (i) the British Bankers Association
LIBOR Rate (“BBA LIBOR”), as published by Reuters (or such other
commercially available source providing quotations of BBA LIBOR as may be
designated by the Administrative Agent from time to time) at approximately
11:00 a.m., London time, two London Banking Days prior to the commencement
of such Interest Period, for Dollar deposits (for delivery on the first day of
such Interest Period) with a term equivalent to 

 

8

 

such Interest Period or, (ii) if
such rate is not available at such time for any reason, the rate per annum
determined by the Administrative Agent to be the rate at which deposits in
Dollars for delivery on the first day of such Interest Period in same day funds
in the approximate amount of the Eurodollar Rate Loan being made, continued or
converted and with a term equivalent to such Interest Period would be offered
by Bank of America’s London Branch to major banks in the London interbank
eurodollar market at their request at approximately 11:00 a.m. (London
time) two London Banking Days prior to the commencement of such Interest
Period; and

 

(b)           for any interest calculation with respect to a Base
Rate Loan on any date, the rate per annum equal to (i) BBA LIBOR, at
approximately 11:00 a.m., London time determined two London Banking Days
prior to such date for Dollar deposits being delivered in the London interbank
market for a term of one month commencing that day or (ii) if such
published rate is not available at such time for any reason, the rate per annum
determined by the Administrative Agent to be the rate at which deposits in
Dollars for delivery on the date of determination in same day funds in the
approximate amount of the Base Rate Loan being made or maintained and with a
term equal to one month would be offered by Bank of America’s London Branch to
major banks in the London interbank Eurodollar market at their request at the
date and time of determination.

 

“Eurodollar Rate Loan” means a Loan that bears interest at a
rate based on clause (a) of the definition of “Eurodollar Rate.

 

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

 

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

 

“Excluded
Taxes” means, with respect to the Administrative Agent, any
Lender, any L/C Issuer or any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder, (a) Taxes
imposed on or measured by all or part of its income, profit, or gains, and any
excise, net worth, capital-based, value-added, doing business or franchise
taxes imposed on it (however denominated), by the United States or 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, (c) any
backup withholding Tax that is required by the Code to be withheld
from amounts payable to a Lender or L/C Issuer (i) that has failed to
comply with Section 3.01(e)(ii) or (ii) has complied with
Section 3.01(e)(ii) but is nonetheless subject to backup
withholding Tax, (d) in the case of the Administrative Agent, any Lender
or any L/C Issuer (other than an assignee pursuant to a request by the Borrower
under Section 10.13), any withholding tax that (i) is required
to be imposed on amounts payable to such Person pursuant to the Laws in force
at the time such Person becomes a party hereto (or designates a new Lending
Office) or (ii) is attributable to such Person’s failure or inability
(other than as a result of a Change in Law) to comply with clause (B) of Section 3.01(e)(ii),
except to the extent that such Person (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)(ii) or (c); and (e) any
Tax that is attributable to the Administrative Agent’s, a Lender’s or a L/C
Issuer’s failure to satisfy the 

 

9

 

applicable requirements as set forth in Section 1471,
1472, 1473 or 1474 of the Code (or any successor provisions) or any regulation
or administrative guidance promulgated thereunder.

 

“Existing Credit Agreement” means that certain Credit Agreement
dated as of April 21, 2009 among the Borrower, PNC Bank, National
Association, as administrative agent, and a syndicate of lenders.

 

“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 March 12,
2010, among the Borrower, the Administrative Agent and the
Arranger.

 

“Fitch” means Fitch Investors Service
Inc. and any successor thereto.

 

“Fitch Rating” means, on any date of
determination, the rating accorded the Borrower’s senior unsecured long-term
debt by Fitch (or if the Obligations are secured, the rating accorded to the
Borrower’s senior secured long-term debt by Fitch), or if such rating is
unavailable, the Borrower’s long-term issuer default rating accorded to it by
Fitch.

 

“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 (including such a Lender when acting in the capacity of an L/C
Issuer).  For purposes of this
definition, the United States, each State thereof and the District of Columbia
shall be deemed to constitute a single jurisdiction.

 

“FPA” means the Federal Power Act, as amended, and all rules and
regulations promulgated thereunder.

 

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

 

“Fronting Exposure” means, at any time there is a Defaulting
Lender, with respect to the L/C Issuers, such Defaulting Lender’s Applicable
Percentage of the outstanding L/C Obligations other than L/C Obligations as to
which such Defaulting Lender’s participation obligation has been reallocated to
other Lenders or Cash Collateralized in accordance with the terms hereof.

 

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

 

10

 

“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 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).  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.

 

“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:

 

11

 

(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) and bankers’ acceptances;

 

(c)           all obligations of such
Person to pay the deferred purchase price of capital assets or services that in
accordance with GAAP would be shown on the liability side of the balance sheet
of such Person;

 

(d)           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;

 

(e)           capital leases and
Synthetic Lease Obligations;

 

(f)            all obligations of
such Person to purchase, redeem, retire, defease or otherwise make any payment
in respect of any Redeemable Stock in such 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;

 

(g)           the full outstanding
balance of trade receivables, notes or other instruments sold with full
recourse (and the portion thereof subject to potential recourse, if sold with
limited recourse), other than in any such case any thereof sold solely for
purposes of collection of delinquent accounts; 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, unless such Indebtedness is expressly
made non-recourse to such Person and shall exclude trade payables and other
similar accrued expenses arising in the ordinary course of business,
obligations in respect of insurance policies or performance or surety bonds
that themselves are not guarantees of Indebtedness (or drafts, acceptances or
similar instruments evidencing the same or obligations in respect of letters of
credit supporting the payment of the same). 
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.

 

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

 

“Information” has the meaning specified in Section 10.07.

 

12

 

“Interest Payment Date” means, (a) as to any Eurodollar
Rate Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; provided, however, that if any Interest Period for
a Eurodollar Rate Loan exceeds three months, the respective dates that fall
every three months after the beginning of such Interest Period shall also be
Interest Payment Dates; and (b) as to any Base Rate Loan, the last
Business Day of each March, June, September and December and the
Maturity Date.

 

“Interest Period” means, as to each Eurodollar Rate Loan, the
period commencing on the date such Eurodollar Rate Loan is disbursed or
converted to or continued as a Eurodollar Rate Loan and ending on the date one,
two, three or six months thereafter, as selected by the Borrower in its Loan
Notice; provided that:

 

(i)            any Interest Period that would otherwise end on a day
that is not a Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day;

 

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

 

(iii)          no Interest Period shall extend beyond the Maturity
Date.

 

“Internal Revenue Service” means the United States Internal
Revenue Service, or any Governmental Authority succeeding to any of its
principal functions.

 

“Investment” means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the
purchase or other acquisition of Equity Interests of another Person (including
any partnership or joint venture interest in such other Person), (b) a
loan, advance or capital contribution to, or a Guarantee, assumption, purchase
or other acquisition of any debt (other than accounts receivable and lease,
utility or other deposits arising in the ordinary course of business on terms
customary in the trade) of, another Person, including any partnership or joint
venture interest in such other Person and any arrangement pursuant to which the
investor Guarantees Indebtedness of such other Person, or (c) the purchase
or other acquisition (in one transaction or a series of transactions) of assets
of another Person that constitute a business unit.  For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment.

 

“IP Rights” has the meaning specified in Section 5.17.

 

“ISP” means, with respect to any Letter of Credit, the “International
Standby Practices 1998” published by the Institute of International Banking Law &
Practice, Inc. (or such later version thereof as may be in effect at the
time of issuance).

 

“Issuer Documents” means with respect to any Letter of Credit,
the Letter of Credit Application, and any other document, agreement and
instrument entered into by any L/C Issuer 

 

13

 

and the Borrower or entered into by the Borrower in
favor of any L/C Issuer and relating to such Letter of Credit.

 

“Laws” means, as to any Person, collectively, all international,
foreign, Federal, state and local statutes, treaties, rules, 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 of, and agreements with, any
Governmental Authority, binding upon such Person or to which such Person is
subject.

 

“L/C Advance” means, with respect to each Lender, such Lender’s
funding of its participation in any L/C Borrowing in accordance with its
Applicable Percentage.

 

“L/C Borrowing” means an extension of credit resulting from a
drawing under any Letter of Credit which has not been reimbursed on the date
when made or refinanced as a Borrowing.

 

“L/C Credit Extension” means, with respect to any Letter of
Credit, the issuance thereof or extension of the expiry date thereof, or the
increase of the amount thereof.

 

“L/C Issuer” means, individually or collectively as the context
may indicate, (a) Bank of America in its capacity as an issuer of Letters
of Credit hereunder, (b) any other Lender which consents to its
appointment by the Borrower as an issuer of Letters of Credit hereunder in its
capacity as an issuer of Letters of Credit hereunder and (c) any successor
issuer of Letters of Credit hereunder.

 

“L/C Obligations” means, as at any date of determination, the
aggregate amount available to be drawn under all outstanding Letters of Credit plus
the aggregate of all Unreimbursed Amounts, including all L/C Borrowings.  For purposes of computing the amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.06.  For all purposes of this Agreement, if on any
date of determination a Letter of Credit has expired by its terms but any
amount may still be drawn thereunder by reason of the operation of Rule 3.14
of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the
amount so remaining available to be drawn.

 

“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.

 

“Letter of Credit” means any standby letter of credit issued hereunder.

 

“Letter of Credit Application” means an application and
agreement for the issuance or amendment of a Letter of Credit in the form from
time to time in use by the applicable L/C Issuer.

 

“Letter of Credit Expiration Date” means the day that is seven
days prior to the Maturity Date then in effect (or, if such day is not a
Business Day, the next preceding Business Day).

 

14

 

“Letter of Credit Fee” has the meaning specified in Section 2.03(h).

 

“Letter of Credit Sublimit” means an amount equal to
$50,000,000.  The Letter of Credit
Sublimit is part of, and not in addition to, the Aggregate Commitments.

 

“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, each Issuer
Document, any agreement creating or perfecting rights in Cash Collateral
pursuant to the provisions of Section 2.14 of this Agreement and
the Fee Letter.

 

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

 

“London Banking Day” means any day on which dealings in Dollar
deposits are conducted by and between banks in the London interbank eurodollar
market.

 

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

 

“Maturity Date” means April 20, 2013; provided, however, that if such date is not a Business
Day, the Maturity Date shall be the next preceding Business Day.

 

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

 

“Moody’s Rating” means, on any date of
determination, the rating accorded the Borrower’s senior unsecured long-term
debt by Moody’s (or if the Obligations are secured, the rating accorded to the
Borrower’s senior secured long-term debt by Moody’s), or if such rating is
unavailable, the Borrower’s long-term issuer credit rating accorded to it by
Moody’s.

 

“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.

 

15

 

“Multiple Employer Plan” means a Plan which has two or more
contributing sponsors (including the Borrower or any ERISA Affiliate) at least
two of whom are not under common control, as such a plan is described in Section 4064
of ERISA.

 

“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, the Borrower arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, in each
case 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 the Borrower 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); (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 (i) 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; and (ii) with respect to any L/C Obligations on
any date, the amount of such L/C Obligations on such date after giving effect
to any L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result
of any reimbursements by the Borrower of Unreimbursed Amounts.

 

“Parent” means DPL Inc., an Ohio
corporation.

 

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

 

“PBGC” means the Pension Benefit Guaranty Corporation or any
successor.

 

“Pension Act” means the Pension Protection Act of 2006, as
amended.

 

“Pension Funding Rules” means the rules of
the Code and ERISA regarding minimum required contributions (including any
installment payment thereof) to Pension Plans and set forth

 

16

 

in, with respect to plan years ending prior to the
effective date of the Pension Act, Section 412 of the Code and Section 302
of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412,
430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

 

“Pension Plan” means any employee pension benefit plan
(including a Multiple Employer Plan) that is maintained or is contributed to by
the Borrower and any ERISA Affiliate and is either covered by Title IV of ERISA
or is subject to the minimum funding standards under Section 412 of
the Code.

 

“Permitted Acquisition” means and
includes any Acquisition as to which all of the following conditions are
satisfied:  (a) such Acquisition (i) involves a line or lines of
an Energy-Related Business, and (ii) involves a Person or a line or lines
of business that are located and operated in the United States; (b) no
Default or Event of Default shall exist prior to or immediately after giving
effect to such Acquisition; (c) such Acquisition is not being consummated
on a hostile basis and has been approved by the Board of Directors of the
target Person and no material challenge to such Acquisition shall be pending or
threatened by any shareholder or director of the seller or Person to be
acquired, and (d) as of the date of the consummation of such Acquisition,
all approvals required in connection therewith shall have been obtained.

 

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

 

“Plan” means any employee benefit plan within the meaning of Section 3(3) of
ERISA (including a Pension Plan), maintained for employees of the Borrower or
any ERISA Affiliate or any such Plan to which the Borrower or any ERISA
Affiliate is required to contribute on behalf of any of its employees, other
than a Multiemployer Plan.

 

“Platform” has the meaning specified in Section 6.02.

 

“Public Lender” has the meaning
specified in Section 6.02.

 

“Rating” means any of the Fitch
Ratings, Moody’s Ratings or S&P Ratings.

 

“Rating Agency” means any of Fitch,
Moody’s or S&P.

 

“Redeemable Stock” means, with respect
to any Person, any Equity Interests of such Person that (a) is by its
terms subject to mandatory redemption, in whole or in part, pursuant to a
sinking fund, scheduled redemption or similar provisions, at any time prior to
the Maturity Date; or (b) otherwise is required to be repurchased or
retired on a scheduled date or dates, upon the occurrence of any event or
circumstance, at the option of the holder or holders thereof, or otherwise, at
any time prior to the Maturity Date, other than any such repurchase or
retirement occasioned by a “change of control” or similar event.

 

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

 

17

 

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

 

“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
under ERISA or applicable regulations.

 

“Request for Credit Extension” means (a) with respect to a
Borrowing, conversion or continuation of Loans, a Loan Notice, and (b) with
respect to an L/C Credit Extension, a Letter of Credit Application.

 

“Required Lenders” means, as of any date of determination,
Lenders having more than 50% (or if there are fewer than three Lenders, Lenders
having 100%) of the Aggregate Commitments or, if the commitment of each Lender
to make Loans and the obligation of the L/C Issuers to make L/C Credit
Extensions have been terminated pursuant to Section 8.02, Lenders
holding in the aggregate more than 50% (or if there are fewer than three
Lenders, 100%) of the Total Outstandings (with the aggregate amount of each
Lender’s risk participation and funded participation in L/C Obligations being
deemed “held” by such Lender for purposes of this definition); 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 chief executive officer,
president, chief financial officer, treasurer, assistant treasurer or
controller of the Borrower and,  solely for
purposes of the delivery of incumbency certificates pursuant to Section 4.01,
the secretary or any assistant secretary of the Borrower or, in each case, any
officer of the Borrower with a similar title. 
Any document delivered hereunder that is signed by a Responsible Officer
of the Borrower shall be conclusively presumed to have been authorized by all
necessary corporate, partnership and/or other action on the part of the Borrower
and such Responsible Officer shall be conclusively presumed to have acted on
behalf of the Borrower.

 

“Restricted Payment” means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity
Interest of the Borrower or any Subsidiary, 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 the Borrower’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.

 

“S&P Rating” means, on any date of
determination, the rating accorded to the Borrower’s senior unsecured long-term
debt by S&P (or if the Obligations are secured, the rating accorded to the
Borrower’s senior secured long-term debt by S&P), or if such rating is
unavailable, the Borrower’s long-term issuer credit rating accorded to it by
S&P.

 

18

 

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

 

“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.

 

“Substantial Portion” means, with
respect to the property of the Borrower and its Subsidiaries, property that (a) represents
more than 20% of the Consolidated Tangible Assets of the Borrower and its
Subsidiaries as would be shown in the consolidated financial statements of the
Borrower and its Subsidiaries as at the beginning of the twelve-month period
ending with the month in which such determination is made or (b) is
responsible for more than 20% of the consolidated net sales or of the
Consolidated Net Income of the Borrower and its Subsidiaries as reflected in
the financial statements referred to in clause (a) above.

 

“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 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).

 

19

 

“Synthetic Lease Obligation” means the monetary obligation of a
Person under any lease (a) that is accounted for by the lessee as an
operating lease and (b) under which the lessee is intended to be the “owner”
of the leased property for Federal income tax purposes.

 

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

 

“Total Outstandings” means the aggregate Outstanding Amount of
all Loans and all L/C Obligations.

 

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

 

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

 

“Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).

 

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 “hereto,”
“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.”

 

20

 

(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
as otherwise specifically prescribed herein. Notwithstanding the foregoing, for
purposes of determining compliance with any covenant (including the computation
of any financial covenant) contained herein, Indebtedness of the Borrower and
its Subsidiaries shall be deemed to be carried at 100% of the outstanding
principal amount thereof, and the effects of FASB ASC 825 on financial
liabilities shall be disregarded.

 

(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, and either the Borrower or the Required Lenders
shall so request, the Administrative Agent and the Borrower shall negotiate in
good faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the
Required Lenders not to be unreasonably withheld or delayed); provided  that,
until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in
GAAP.

 

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).

 

1.06        Letter of Credit Amounts.  Unless
otherwise specified herein, the amount of a Letter of Credit at any time shall
be deemed to be the stated amount of such Letter of Credit in effect at such
time; provided, however, that with respect to any Letter of Credit that, by its
terms or the terms of any Issuer Document related thereto, provides for one or
more automatic increases in the stated amount thereof, the amount of such
Letter of Credit shall be deemed to be the maximum stated amount of such Letter
of Credit after giving effect to all such increases, whether or not such
maximum stated amount is in effect at such time.

 

21

 

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, plus such Lender’s Applicable Percentage of the
Outstanding Amount of all L/C Obligations 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 2.04,
and reborrow under this Section 2.01.  Loans may be Base Rate Loans or Eurodollar
Rate Loans, as further provided herein.

 

2.02        Borrowings,
Conversions and Continuations of Loans.

 

(a)           Each
Borrowing, each conversion of Loans from one Type to the other, and each
continuation of Eurodollar Rate Loans 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) three
Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate
Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing
of Base 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, conversion
to or continuation of Eurodollar Rate Loans shall be in a principal amount of
$1,000,000 or a whole multiple of $500,000 in excess thereof.  Except as provided in Sections 2.03(c),
each Borrowing of or conversion to 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, a
conversion of Loans from one Type to the other, or a continuation of Eurodollar
Rate Loans, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Loans to be borrowed, converted or continued, (iv) the
Type of Loans to be borrowed or to which existing Loans are to be converted,
and (v) if applicable, the duration of the Interest Period with respect
thereto.  If the Borrower fails to
specify a Type of Loan in a Loan Notice or if the Borrower fails to give a
timely notice requesting a conversion or continuation, then the applicable
Loans shall be made as, or converted to, Base Rate Loans.  Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans.  If the Borrower requests a Borrowing of,
conversion to, or continuation of Eurodollar Rate Loans in any such Loan
Notice, but fails to specify an Interest Period, it will be deemed to have
specified an Interest Period of one month.

 

(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, and
if no timely notice of a conversion or continuation is provided by the
Borrower, the Administrative Agent shall notify each Lender of the details of
any automatic conversion to Base Rate Loans 

 

22

 

described in the preceding subsection. 
In the case of a Borrowing, each Lender shall make the amount of its
Loan available in Dollars 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 immediately available
to the Borrower in Dollars 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)           Except
as otherwise provided herein, a Eurodollar Rate Loan may be continued or
converted only on the last day of an Interest Period for such Eurodollar Rate
Loan.  During the existence of a Default,
no Loans may be requested as, converted to or continued as Eurodollar Rate
Loans without the consent of the Required Lenders.

 

(d)           The
Administrative Agent shall promptly notify the Borrower and the Lenders of the
interest rate applicable to any Interest Period for Eurodollar Rate Loans upon
determination of such interest rate.  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.

 

(e)           After
giving effect to all Borrowings, all conversions of Loans from one Type to the
other, and all continuations of Loans as the same Type, there shall not be more
than ten Interest Periods in effect with respect to Loans.

 

2.03        Letters
of Credit.

 

(a)           The
Letter of Credit Commitment.

 

(i)            Subject to the terms and conditions
set forth herein, (A) each L/C Issuer agrees, in reliance upon the
agreements of the Lenders set forth in this Section 2.03, (1) from
time to time on any Business Day during the period from the Closing Date until
the Letter of Credit Expiration Date, to issue Letters of Credit for the
account of the Borrower, and to amend or extend Letters of Credit previously
issued by it, in accordance with subsection (b) below, and (2) to
honor drawings under the Letters of Credit; and (B) the Lenders severally
agree to participate in Letters of Credit issued for the account of the
Borrower and any drawings thereunder; provided that after giving effect
to any L/C Credit Extension with respect to any Letter of Credit, (x) the
Total Outstandings shall not exceed the Aggregate Commitments, (y) the
aggregate Outstanding Amount of the Loans of any Lender, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations
shall not exceed such Lender’s Commitment, and (z) the Outstanding Amount
of the L/C Obligations shall not exceed the Letter of Credit Sublimit.  Each request by the Borrower for the issuance
or amendment of a Letter of Credit shall be deemed to be a representation by
the Borrower that the L/C Credit Extension so requested complies with the
conditions set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to
the terms and conditions hereof, the Borrower’s 

 

23

 

ability to obtain Letters of Credit shall be fully revolving,
and accordingly the Borrower may, during the foregoing period, obtain Letters
of Credit to replace Letters of Credit that have expired or that have been
drawn upon and reimbursed.  The Borrower
agrees to promptly notify the Administrative Agent of the designation of any
Lender as an L/C Issuer.

 

(ii)           No L/C Issuer shall issue any Letter
of Credit, if:

 

(A)          subject to Section 2.03(b)(iii),
the expiry date of the requested Letter of Credit would occur more than twelve
months after the date of issuance or last extension, unless the Required
Lenders have approved such expiry date; or

 

(B)           the expiry date of the requested
Letter of Credit would occur after the Letter of Credit Expiration Date, unless
all the Lenders (other than any Defaulting Lenders) have approved such expiry
date.

 

(iii)          No L/C Issuer shall be under any
obligation to issue any Letter of Credit if:

 

(A)          any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport to enjoin or
restrain such L/C Issuer from issuing the Letter of Credit, or any Law
applicable to such L/C Issuer or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction over
such L/C Issuer shall prohibit, or request that such L/C Issuer refrain from,
the issuance of letters of credit generally or the Letter of Credit in
particular or shall impose upon such L/C Issuer with respect to the Letter of
Credit any restriction, reserve or capital requirement (for which such L/C
Issuer is not otherwise compensated hereunder) not in effect on the Closing
Date, or shall impose upon such L/C Issuer any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which such L/C Issuer
in good faith deems material to it;

 

(B)           the issuance of the Letter of Credit
would violate one or more customary and reasonable policies of such L/C Issuer
applicable to letters of credit generally;

 

(C)           except as otherwise agreed by the
Administrative Agent and such L/C Issuer, the Letter of Credit is in an initial
stated amount less than $500,000;

 

(D)          the Letter of Credit is to be
denominated in a currency other than Dollars;

 

(E)           any Lender is at that time a Defaulting Lender, unless
the L/C Issuers have entered into arrangements, including the delivery of Cash
Collateral, satisfactory to the L/C Issuers (in their sole discretion) with the
Borrower or such Lender to eliminate the L/C Issuers’ actual or potential
Fronting Exposure (after giving effect to Section 2.15(a)(iv)) with
respect to the Defaulting Lender arising from that Letter of Credit and all
other L/C Obligations as to which the L/C 

 

24

 

Issuers have actual or potential Fronting Exposure, as
they may elect in their sole discretion.

 

(iv)          No L/C Issuer shall amend any Letter
of Credit if such L/C Issuer would not be permitted at such time to issue the
Letter of Credit in its amended form under the terms hereof.

 

(v)           No L/C Issuer shall be under any
obligation to amend any Letter of Credit if (A) such L/C Issuer would have
no obligation at such time to issue the Letter of Credit in its amended form
under the terms hereof, or (B) the beneficiary of the Letter of Credit
does not accept the proposed amendment to the Letter of Credit.

 

(vi)          Each L/C Issuer shall act on behalf of
the Lenders with respect to any Letters of Credit issued by it and the
documents associated therewith, and each L/C Issuer shall have all of the
benefits and immunities (A) provided to the Administrative Agent in Article IX
with respect to any acts taken or omissions suffered by such L/C Issuer in
connection with Letters of Credit issued by it or proposed to be issued by it
and Issuer Documents pertaining to such Letters of Credit as fully as if the
term “Administrative Agent” as used in Article IX included each L/C
Issuer with respect to such acts or omissions, and (B) as additionally
provided herein with respect to each L/C Issuer.

 

(b)           Procedures
for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of
Credit.

 

(i)            Each Letter of Credit shall be
issued or amended, as the case may be, upon the request of the Borrower
delivered to the applicable L/C Issuer (with a copy to the Administrative
Agent) in the form of a Letter of Credit Application, appropriately completed
and signed by a Responsible Officer of the Borrower.  Such Letter of Credit Application must be
received by the applicable L/C Issuer and the Administrative Agent not later
than 11:00 a.m. at least two Business Days (or such later date and time as
the Administrative Agent and such L/C Issuer may agree in a particular instance
in their sole discretion) prior to the proposed issuance date or date of
amendment, as the case may be.  In the
case of a request for an initial issuance of a Letter of Credit, such Letter of
Credit Application shall specify in form and detail reasonably satisfactory to
the applicable L/C Issuer: (A) the proposed issuance date of the requested
Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the
expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the
documents to be presented by such beneficiary in case of any drawing
thereunder; (F) the full text of any certificate to be presented by such
beneficiary in case of any drawing thereunder; (G) the purpose and nature
of the requested Letter of Credit; and (H) such other matters as the
applicable L/C Issuer may reasonably require. 
In the case of a request for an amendment of any outstanding Letter of
Credit, such Letter of Credit Application shall specify in form and detail
satisfactory to the applicable L/C Issuer (A) the Letter of Credit to be
amended; (B) the proposed date of amendment thereof (which shall be a
Business Day); (C) the nature of the proposed amendment; and (D) such
other matters as the applicable L/C Issuer may reasonably require.  Additionally, the Borrower shall furnish to
the applicable L/C Issuer and the 

 

25

 

Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as such L/C Issuer or the
Administrative Agent may reasonably require.

 

(ii)           Promptly after receipt of any Letter
of Credit Application, the applicable L/C Issuer will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent
has received a copy of such Letter of Credit Application from the Borrower and,
if not, such L/C Issuer will provide the Administrative Agent with a copy
thereof.  Unless the applicable L/C
Issuer has received written notice from any Lender, the Administrative Agent or
the Borrower, at least one Business Day prior to the requested date of issuance
or amendment of the applicable Letter of Credit, that one or more applicable
conditions contained in Article IV shall not then be satisfied,
then, subject to the terms and conditions hereof, such L/C Issuer shall, on the
requested date, issue a Letter of Credit for the account of the Borrower or
enter into the applicable amendment, as the case may be, in each case in
accordance with such L/C Issuer’s usual and customary business practices.  Immediately upon the issuance of each Letter
of Credit, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the applicable L/C Issuer a risk
participation in such Letter of Credit in an amount equal to the product of
such Lender’s Applicable Percentage times the amount of such Letter of
Credit.

 

(iii)          If the Borrower so requests in any
applicable Letter of Credit Application, the applicable L/C Issuer may, in its
sole discretion, agree to issue a Letter of Credit that has automatic extension
provisions (each, an “Auto-Extension Letter of Credit”); provided
that any such Auto-Extension Letter of Credit must permit such L/C Issuer to
prevent any such extension at least once in each twelve-month period
(commencing with the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary thereof not later than a day (the “Non-Extension
Notice Date”) in each such twelve-month period to be agreed upon at the
time such Letter of Credit is issued. 
Unless otherwise directed by the applicable L/C Issuer, the Borrower
shall not be required to make a specific request to such L/C Issuer for any
such extension.  Once an Auto-Extension
Letter of Credit has been issued, the Lenders shall be deemed to have
authorized (but may not require) the applicable L/C Issuer to permit the
extension of such Letter of Credit at any time to an expiry date not later than
the Letter of Credit Expiration Date; provided, however, that
such L/C Issuer shall not permit any such extension if (A) such L/C Issuer
has determined that it would not be permitted, or would have no obligation, at
such time to issue such Letter of Credit in its revised form (as extended)
under the terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) it has received
notice (which may be by telephone or in writing) on or before the day that is
twenty Business Days before the Non-Extension Notice Date from the
Administrative Agent, any Lender or the Borrower that one or more of the
applicable conditions specified in Section 4.02 is not then
satisfied, and in each such case directing such L/C Issuer not to permit such
extension.

 

(iv)          Promptly after its delivery of any
Letter of Credit or any amendment to a Letter of Credit to an advising bank
with respect thereto or to the beneficiary thereof, the 

 

26

 

applicable L/C Issuer will also deliver to the
Borrower and the Administrative Agent a true and complete copy of such Letter
of Credit or amendment.

 

(c)           Drawings
and Reimbursements; Funding of Participations.

 

(i)            In each case upon receipt from the
beneficiary of any Letter of Credit of any notice of a drawing under such
Letter of Credit and upon payment to a beneficiary under such Letter of Credit,
the applicable L/C Issuer shall notify the Borrower and the Administrative
Agent thereof.  Not later than 4:00 p.m.
on the date of any payment by the applicable L/C Issuer under a Letter of
Credit, if the Borrower has been so notified at or before 11:00 a.m. on
such date, otherwise not later than 11:00 a.m. on the next Business Day
(each such date, an “Honor Date”), the Borrower shall reimburse such L/C
Issuer through the Administrative Agent in an amount equal to the amount of
such drawing.  If the Borrower fails to
so reimburse the applicable L/C Issuer by such time, the Administrative Agent
shall promptly notify each Lender of the Honor Date, the amount of the
unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such
Lender’s Applicable Percentage thereof. 
In such event, the Borrower shall be deemed to have requested a
Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and multiples
specified in Section 2.02 for the principal amount of Base Rate
Loans, but subject to the amount of the unutilized portion of the Aggregate
Commitments and the conditions set forth in Section 4.02 (other
than the delivery of a Loan Notice).  Any
notice given by the applicable L/C Issuer or the Administrative Agent pursuant
to this Section 2.03(c)(i) may be given by telephone if
immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of
such notice.

 

(ii)           Each Lender shall upon any notice
pursuant to Section 2.03(c)(i) make funds available (and the
Administrative Agent may apply Cash Collateral provided for this purpose) for
the account of the applicable L/C Issuer at the Administrative Agent’s Office
in an amount equal to its Applicable Percentage of the Unreimbursed Amount not
later than 1:00 p.m. on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of Section 2.03(c)(iii),
each Lender that so makes funds available shall be deemed to have made a Base
Rate Loan to the Borrower in such amount. 
The Administrative Agent shall remit the funds so received to the
applicable L/C Issuer.

 

(iii)          With respect to any Unreimbursed
Amount that is not fully refinanced by a Borrowing of Base Rate Loans because
the conditions set forth in Section 4.02 (other than delivery of a
Loan Notice) cannot be satisfied or for any other reason, the Borrower shall be
deemed to have incurred from the applicable L/C Issuer an L/C Borrowing in the
amount of the Unreimbursed Amount that is not so refinanced, which L/C
Borrowing shall be due and payable on demand (together with interest) and upon
such demand shall bear interest at the Default Rate.  In such event, each Lender’s payment to the
Administrative Agent for the account of the applicable L/C Issuer pursuant to Section 2.03(c)(ii) shall
be deemed payment in respect of its participation in such L/C Borrowing 

 

27

 

and shall constitute an L/C Advance from such Lender
in satisfaction of its participation obligation under this Section 2.03.

 

(iv)          Until each Lender funds its Loan or
L/C Advance pursuant to this Section 2.03(c) to reimburse the
applicable L/C Issuer for any amount drawn under any Letter of Credit, interest
in respect of such Lender’s Applicable Percentage of such amount shall be
solely for the account of such L/C Issuer.

 

(v)           Each Lender’s obligation to make
Loans or L/C Advances to reimburse the applicable L/C Issuer for amounts drawn
under Letters of Credit, as contemplated by this Section 2.03(c),
shall be absolute and unconditional and shall not be affected by any
circumstance, including (A) any setoff, counterclaim, recoupment, defense
or other right which such Lender may have against such L/C Issuer, the Borrower
or any other Person for any reason whatsoever; (B) the occurrence or
continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however,
that each Lender’s obligation to make Loans pursuant to this Section 2.03(c) is
subject to the conditions set forth in Section 4.02 (other than
delivery by the Borrower of a Loan Notice). 
No such making of an L/C Advance shall relieve or otherwise impair the
obligation of the Borrower to reimburse the applicable L/C Issuer for the
amount of any payment made by such L/C Issuer under any Letter of Credit,
together with interest as provided herein.

 

(vi)          If any Lender fails to make available
to the Administrative Agent for the account of the applicable L/C Issuer any
amount required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(ii),
then, without limiting the other provisions of this Agreement, such L/C Issuer
shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to such L/C Issuer at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by such L/C Issuer in
accordance with banking industry rules on interbank compensation, plus any
administrative, processing or similar fees customarily charged by such L/C
Issuer in connection with the foregoing. 
If such Lender pays such amount (with interest and fees as aforesaid),
the amount so paid shall constitute such Lender’s Loan included in the relevant
Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case
may be.  A certificate of the applicable
L/C Issuer submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (vi) shall be conclusive
absent manifest error.

 

(d)           Repayment
of Participations.

 

(i)            At any time after the applicable L/C
Issuer has made a payment under any Letter of Credit and has received from any
Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.03(c),
if the Administrative Agent receives for the account of such L/C Issuer any
payment in respect of the related Unreimbursed Amount or interest thereon
(whether directly from the Borrower or otherwise, including proceeds of Cash
Collateral applied thereto by the Administrative Agent), the 

 

28

 

Administrative Agent will distribute to such Lender
its Applicable Percentage thereof in the same funds as those received by the
Administrative Agent.

 

(ii)           If any payment received by the
Administrative Agent for the account of the applicable L/C Issuer pursuant to Section 2.03(c)(i) is
required to be returned under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by such L/C Issuer in its
discretion), each Lender shall pay to the Administrative Agent for the account
of such L/C Issuer its Applicable Percentage thereof on demand of the
Administrative Agent, plus interest thereon from the date of such demand to the
date such amount is returned by such Lender, at a rate per annum equal to the
Federal Funds Rate from time to time in effect. 
The obligations of the Lenders under this clause shall survive the
payment in full of the Obligations and the termination of this Agreement.

 

(e)           Obligations
Absolute.  The
obligation of the Borrower to reimburse the applicable L/C Issuer for each
drawing under each Letter of Credit and to repay each L/C Borrowing shall be
absolute, unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement under all circumstances, including
the following:

 

(i)            any lack of validity or
enforceability of such Letter of Credit, this Agreement, or any other Loan
Document;

 

(ii)           the existence of any claim,
counterclaim, setoff, defense or other right that the Borrower or any
Subsidiary may have at any time against any beneficiary or any transferee of
such Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the applicable L/C Issuer or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by such Letter of Credit or any agreement or instrument relating thereto, or
any unrelated transaction;

 

(iii)          any draft, demand, certificate or
other document presented under such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under such Letter of Credit;

 

(iv)          any payment by the applicable L/C
Issuer under such Letter of Credit against presentation of a draft or
certificate that does not strictly comply with the terms of such Letter of
Credit; or any payment made by such L/C Issuer under such Letter of Credit to
any Person purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of such
Letter of Credit, including any arising in connection with any proceeding under
any Debtor Relief Law; or

 

(v)           any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Borrower or any Subsidiary.

 

29

 

The Borrower shall promptly examine a copy of each
Letter of Credit and each amendment thereto that is delivered to it and, in the
event of any claim of noncompliance with the Borrower’s instructions or other
irregularity, the Borrower will immediately notify the applicable L/C
Issuer.  The Borrower shall be
conclusively deemed to have waived any such claim against the applicable L/C
Issuer and its correspondents unless such notice is given as aforesaid.

 

(f)            Role
of L/C Issuer.  Each Lender and the Borrower agree
that, in paying any drawing under a Letter of Credit, the applicable L/C Issuer
shall not have any responsibility to obtain any document (other than any sight
draft, certificates and documents expressly required by the Letter of Credit)
or to ascertain or inquire as to the validity or accuracy of any such document
or the authority of the Person executing or delivering any such document.  None of the applicable L/C Issuer, the
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the applicable L/C Issuer shall be
liable to any Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of the Lenders or the Required
Lenders, as applicable; (ii) any action taken or omitted in the absence of
gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Issuer Document. 
The Borrower hereby assumes all risks of the acts or omissions of any
beneficiary or transferee with respect to its use of any Letter of Credit; provided,
however, that this assumption is not intended to, and shall not,
preclude the Borrower’s pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.  None of the applicable L/C Issuer, the
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the applicable L/C Issuer shall be
liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.03(e); provided, however, that
anything in such clauses to the contrary notwithstanding, the Borrower may have
a claim against any such Person, and such Person may be liable to the Borrower,
to the extent, but only to the extent, of any direct, as opposed to
consequential or exemplary, damages suffered by the Borrower which the Borrower
proves were caused by such Person’s willful misconduct or gross negligence or
such Person’s willful failure to pay under any Letter of Credit after the presentation
to it by the beneficiary of a sight draft and certificate(s) strictly
complying with the terms and conditions of a Letter of Credit.   In furtherance and
not in limitation of the foregoing, the applicable L/C Issuer may accept
documents that appear on their face to be in order, without responsibility for
further investigation, and such L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument by a beneficiary transferring or
assigning or purporting to transfer or assign a Letter of Credit or the
beneficiary’s rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.

 

(g)           Applicability
of ISP.  Unless
otherwise expressly agreed by the applicable L/C Issuer and the Borrower when a
Letter of Credit is issued, the rules of the ISP shall apply to each
Letter of Credit.

 

(h)           Letter
of Credit Fees.  The Borrower shall
pay to the Administrative Agent for the account of each Lender in accordance
with its Applicable Percentage a Letter of Credit fee (the “Letter of Credit
Fee”)  for each Letter of Credit equal to the
Applicable Rate times the daily amount available to be drawn under such
Letter of Credit; provided, however, any Letter of 

 

30

 

Credit Fees otherwise payable for the account of a Defaulting Lender
with respect to any Letter of Credit as to which such Defaulting Lender has not
provided Cash Collateral satisfactory to the applicable L/C Issuer pursuant to
this Section 2.03 shall be payable, to the maximum extent permitted
by applicable Law, to the other Lenders in accordance with the upward
adjustments in their respective Applicable Percentages allocable to such Letter
of Credit pursuant to Section 2.15(a)(iv), with the balance of such
fee, if any, payable to such L/C Issuer for its own account.  For purposes of computing the daily amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.06.  Letter of Credit Fees shall be (i) due
and payable on the first Business Day after the end of each March, June, September and
December, commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter
on demand and (ii) computed on a quarterly basis in arrears.  If there is any change in the Applicable Rate
during any quarter, the daily amount available to be drawn under each Letter of
Credit shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect.  Notwithstanding anything to the contrary
contained herein, upon the request of the Required Lenders, while any Event of
Default exists, all Letter of Credit Fees shall accrue at the Default Rate.

 

(i)            Fronting
Fee and Documentary and Processing Charges Payable to L/C Issuer.  The Borrower shall
pay directly to (i) Bank of America, in its capacity as an L/C Issuer, for
its own account a fronting fee with respect to each Letter of Credit issued by
it, at the rate per annum specified in the Fee Letter, computed on the daily
amount available to be drawn under such Letter of Credit on a quarterly basis
in arrears and (ii) each other L/C Issuer for its own account a fronting
fee with respect to each Letter of Credit issued by it, at the rate per annum
agreed to by the Borrower and such L/C Issuer, computed on the daily amount
available to be drawn under such Letter of Credit on a quarterly basis in
arrears.  Such fronting fee shall be due
and payable on the tenth Business Day after the end of each March, June, September and
December in respect of the most
recently-ended quarterly period (or portion thereof, in the case of the first
payment), commencing with the first such date to occur after the
issuance of such Letter of Credit, on the Letter of Credit Expiration Date and
thereafter on demand.  For purposes of
computing the daily amount available to be drawn under any Letter of Credit,
the amount of such Letter of Credit shall be determined in accordance with Section 1.06.  In addition, the Borrower shall pay directly
to each L/C Issuer for its own account the customary issuance, presentation,
amendment and other processing fees, and other standard costs and charges, of
such L/C Issuer relating to letters of credit as from time to time in
effect.  Such customary fees and standard
costs and charges are due and payable on demand and are nonrefundable.

 

(j)            Conflict
with Issuer Documents.  In the event
of any conflict between the terms hereof and the terms of any Issuer Document,
the terms hereof shall control.

 

(k)           Letters
of Credit Reports.  For so long as any Letter of
Credit issued by an L/C Issuer is outstanding, such L/C Issuer shall deliver to
the Administrative Agent on the last Business Day of each calendar month, and
on each date that an L/C Credit Extension occurs with respect to any such
Letter of Credit, a report in the form of Exhibit F, appropriately
completed with the information for every outstanding Letter of Credit issued by
such L/C Issuer.

 

31

 

2.04        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 1:00 p.m. (A) three Business Days
prior to any date of prepayment of Eurodollar Rate Loans and (B) on the
date of prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar
Rate Loans shall be in a principal amount of $1,000,000 or a whole multiple of
$500,000 in excess thereof; and (iii) any prepayment of Base Rate Loans
shall be in a principal amount of $500,000 or a whole multiple of $100,000 in
excess thereof or, in each case, 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 and, if Eurodollar Rate Loans are to be prepaid, the Interest Period(s) of
such Loans.  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.  Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest on the amount prepaid, together
with any additional amounts required pursuant to Section 3.05.  Subject to Section 2.15, 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 and/or
Cash Collateralize the L/C Obligations in an aggregate amount equal to such
excess; provided, however, that the Borrower shall not be
required to Cash Collateralize the L/C Obligations pursuant to this Section 2.04(b) unless
after the prepayment in full of the Loans the Total Outstandings exceed the
Aggregate Commitments then in effect.

 

(c)           If
the Borrower fails to obtain any approval, consent or authorization from any
Governmental Authority which is necessary or required in order to permit the
Borrower to incur Obligations hereunder on or before December 31 of each
calendar year, then the Borrower shall immediately prepay all outstanding Loans
and Cash Collateralize all L/C Obligations to the extent, and only to the extent,
such outstanding Loans and L/C Obligations are not authorized by the then
effective necessary or required approvals, consents and authorizations from
such Governmental Authorities.

 

2.05        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 1:00 p.m.
five Business Days prior to the 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, (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, and (iv) if, after giving effect
to any reduction of the Aggregate Commitments, the Letter of Credit Sublimit
exceeds the amount of the Aggregate Commitments, the Letter of Credit Sublimit
shall be automatically reduced by the amount of such excess.  The 

 

32

 

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.

 

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

 

2.07        Interest.

 

(a)           Subject
to the provisions of subsection (b) below, (i) each Eurodollar Rate
Loan shall bear interest on the outstanding principal amount thereof for each
Interest Period at a rate per annum equal to the Eurodollar Rate for such
Interest Period 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 (without regard 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 any applicable notices have been given and grace periods have
expired), 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)          Upon the request of the Required Lenders, while any Event of
Default exists, the Borrower shall pay interest on the principal amount of all
outstanding Loans hereunder at a fluctuating interest rate per annum at all
times equal to the Default Rate to the fullest extent permitted by applicable
Laws.

 

(iv)          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.

 

2.08        Fees. 
In addition to certain fees described in subsections (h) and (i) of
Section 2.03, the Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Applicable Percentage, a
commitment fee equal to the Applicable Rate times the actual daily
amount by which the Aggregate Commitments exceed the sum of (i) the
Outstanding Amount of Loans and (ii) the Outstanding Amount of L/C Obligations,
subject to 

 

33

 

adjustment as provided in Section 2.15.  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 quarterly in arrears on the last Business Day of each March, June, September and
December, 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 quarterly in arrears, and if
there is any change in the Applicable Rate during any quarter, the actual daily
amount shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect.

 

2.09        Computation of Interest and Fees.   All
computations of interest for Base Rate Loans (including Base Rate Loans
determined by reference to the Eurodollar 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 2.11(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.

 

2.10        Evidence
of Debt.

 

(a)           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.

 

(b)           In
addition to the accounts and records referred to in subsection (a), each Lender
and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit. 
In the event of any conflict between the accounts and records maintained
by the Administrative Agent and the accounts and records of any Lender in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error.

 

34

 

2.11        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 the proposed date of any Borrowing of
Eurodollar Rate Loans (or, in the case of any Borrowing of Base Rate Loans,
prior to 12:00 noon on the date of such 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 Section 2.02 (or,
in the case of a Borrowing of Base Rate Loans, that such Lender has made such
share available 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,
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 or the L/C Issuers hereunder that the Borrower will not make such
payment, the 

 

35

 

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 or the L/C Issuers, as the case may
be, the amount due.  In such event, if
the Borrower has not in fact made such payment, then each of the Lenders or the
L/C Issuers, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or such L/C Issuer, 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, to fund participations in Letters of
Credit and to make payments pursuant to Section 10.04(c) are
several and not joint.  The failure of
any Lender to make any Loan, to fund any such participation 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, to purchase its participation 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.

 

2.12        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, or the
participations in L/C Obligations held by it resulting in such Lender’s
receiving payment of a proportion of the aggregate amount of such Loans or
participations 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 and subparticipations in
L/C Obligations 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:

 

36

 

(i)            if any such participations or
subparticipations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations or subparticipations 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 or on behalf of the
Borrower pursuant to and in accordance with the express terms of this Agreement
(including the application of funds arising from the existence of a Defaulting
Lender), (y) the application of Cash Collateral provided for in Section 2.14,
or (z) any payment obtained by a Lender as consideration for the assignment of
or sale of a participation in any of its Loans or subparticipations in L/C
Obligations to any assignee or participant, other than an assignment to the
Borrower or any Affiliate thereof (as to which the provisions of this Section shall
apply).

 

(b)           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.

 

2.13        Increase
in Commitments.

 

(a)           Request
for Increase.  Provided that no
Default exists, upon notice to the Administrative Agent (which shall promptly
notify the Lenders), the Borrower may from time to time, request an increase in
the Aggregate Commitments by an amount (for all such requests) not exceeding
$50,000,000; provided that (i) any such request for an increase
shall be in a minimum amount of $10,000,000, and (ii) the Borrower may
make a maximum of three such requests.  At the time of sending such notice,
the Borrower (in consultation with the Administrative Agent) shall specify the
time period within which each Lender is requested to respond (which shall in no
event be less than ten Business Days from the date of delivery of such notice
to the Lenders).

 

(b)           Lender
Elections to Increase.  Each Lender
shall notify the Administrative Agent within such time period whether or not it
agrees to increase its Commitment and, if so, whether by an amount equal to,
greater than, or less than its Applicable Percentage of such requested
increase.  Any Lender not responding
within such time period shall be deemed to have declined to increase its
Commitment.

 

(c)           Notification
by Administrative Agent; Additional Lenders.  The Administrative Agent shall notify the
Borrower and each Lender of the Lenders’ responses to each request made
hereunder.  To achieve the full amount of
a requested increase and subject to the approval of the Administrative Agent
and each L/C Issuer (which approvals shall not be unreasonably withheld or
delayed), the Borrower may also invite additional Eligible Assignees to become
Lenders pursuant to a joinder agreement in form and substance reasonably
satisfactory to the Administrative Agent and its counsel.

 

(d)           Effective
Date and Allocations.  If the
Aggregate Commitments are increased in accordance with this Section, the
Administrative Agent and the Borrower shall determine the 

 

37

 

effective date (the “Increase Effective Date”) and the final
allocation of such increase.  The
Administrative Agent shall promptly notify the Borrower and the Lenders of the
final allocation of such increase and the Increase Effective Date.

 

(e)           Conditions
to Effectiveness of Increase.  As a
condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate of the Borrower dated as of the Increase
Effective Date (in sufficient copies for each Lender) signed by a Responsible
Officer of the Borrower (x) certifying and attaching the resolutions
adopted by the Borrower approving or consenting to such increase, and (y) certifying
that, before and after giving effect to such increase, (A) the
representations and warranties contained in Article V are true and
correct in all material respects on and as of the Increase Effective Date,
except that (i) if a qualifier relating to materiality, Material Adverse
Effect or a similar concept applies, such representation or warranty is true
and correct in all respects, (ii) to the extent that such representations
and warranties specifically refer to an earlier date, in which case they are
true and correct in all material respects as of such earlier date (except that
if a qualifier relating to materiality, Material Adverse Effect or a similar
concept applies, such representation or warranty is true and correct in all
respects) and (iii) for purposes of this Section 2.13, 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,
and (B) no Default exists.  The Borrower shall prepay any Loans outstanding on the
Increase Effective Date (and pay any additional amounts required pursuant to Section 3.05)
to the extent necessary to keep the outstanding Loans ratable with any revised
Applicable Percentages arising from any nonratable increase in the Commitments
under this Section.

 

(f)            Conflicting
Provisions.  This Section shall
supersede any provisions in Section 2.12 or 10.01 to the
contrary.

 

2.14        Cash
Collateral.

 

(a)           Certain Credit
Support Events.  Upon the request of the Administrative
Agent or any L/C Issuer (i) if an L/C Issuer has honored any full or
partial drawing request under any Letter of Credit and such drawing has
resulted in an L/C Borrowing that has not been refinanced as a Base Rate Loan
hereunder, or (ii) if, as of the Letter of Credit Expiration Date, any L/C
Obligation for any reason remains outstanding, the Borrower shall, in each
case, immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations.  At any time that there
shall exist a Defaulting Lender, immediately upon the request of the Administrative
Agent or any L/C Issuer, the Borrower shall deliver to the Administrative Agent
Cash Collateral in an amount sufficient to cover all Fronting Exposure (after
giving effect to Section 2.15(a)(iv) and any Cash Collateral
provided by the Defaulting Lender); provided that, the Administrative Agent
and each of the L/C Issuers agree not to, and shall not, request, demand or
otherwise require, and the Borrower shall have no obligation to deliver, pay or
otherwise provide, any such Cash Collateral pursuant to this sentence or the
last sentence of Section 2.14(b) so long as the Borrower is
not permitted to deliver, pay or provide such Cash Collateral under the terms
of any agreement (without giving effect to any provision thereof permitting a
general basket of liens) to which the Borrower is a party or is bound (other
than any agreement entered into with an Affiliate in which the Borrower has
agreed to any such restriction for the benefit of such Affiliate).

 

38

 

(b)           Grant of
Security Interest; Borrower Exceptions.  All Cash Collateral (other than credit support and other
collateral not constituting funds subject to deposit) shall be maintained in
blocked, non-interest bearing deposit accounts at Bank of America; provided
that Cash Collateral delivered, paid or otherwise provided by the Borrower
pursuant to the last sentence of Section 2.14(a) or the last
sentence of this subsection (b) shall not be maintained in such accounts
to the extent not permitted by the terms of any agreement (without giving effect to
any provision thereof permitting a general basket of liens) to
which the Borrower is a party or is bound (other than any agreement entered into with an
Affiliate in which the Borrower has agreed to any such restriction for the
benefit of such Affiliate).  The Borrower, and to the extent provided by
any Lender, such Lender, hereby grants to (and subjects to the control of) the
Administrative Agent, for the benefit of the Administrative Agent, the L/C
Issuers and the Lenders, and agrees to maintain, a first priority security
interest in all such cash, deposit accounts and all balances therein, and all
other property so provided as Cash Collateral, and in all proceeds of the
foregoing, all as security for the obligations to which such Cash Collateral
may be applied pursuant to Section 2.14(c); provided that
the Borrower does not, and shall have no obligation to, grant or maintain any
security interest in, or subject to the control of the Administrative Agent,
any Cash Collateral delivered, paid or otherwise provided by the Borrower
pursuant to the last sentence of Section 2.14(a) or the last
sentence of this subsection (b) to the extent not permitted by the terms
of any agreement (without giving effect to any provision thereof permitting a general
basket of liens) to which the Borrower is a party or
is bound (other than any agreement entered into with an Affiliate in which the
Borrower has agreed to any such restriction for the benefit of such Affiliate).  Subject to the proviso under Section 2.14(a),
if at any time the Administrative Agent determines that Cash Collateral is
subject to any right or claim of any Person other than the Administrative Agent
as herein provided, or that the total amount of such Cash Collateral is less
than the applicable Fronting Exposure and other obligations secured or
supported, as applicable, thereby, the Borrower or the relevant Defaulting
Lender will, promptly upon demand by the Administrative Agent, pay or provide
to the Administrative Agent additional Cash Collateral in an amount sufficient
to eliminate such deficiency.

 

(c)           Application.  Notwithstanding anything to the contrary
contained in this Agreement, Cash Collateral provided under any of this Section 2.14
or Sections 2.03, 2.04, 2.15 or 8.02 in respect of
Letters of Credit shall be held and applied to the satisfaction of the specific
L/C Obligations, obligations to fund participations therein (including, as to
Cash Collateral provided by a Defaulting Lender, any interest accrued on such
obligation) and other obligations for which the Cash Collateral was so
provided, prior to any other application of such property as may be provided
for herein.

 

(d)           Release.  Cash Collateral (or the appropriate portion
thereof) provided to reduce Fronting Exposure or other obligations shall be
released promptly following (i) the elimination of the applicable Fronting
Exposure or other obligations giving rise thereto (including by the termination
of Defaulting Lender status of the applicable Lender (or, as appropriate, its
assignee following compliance with Section 10.06(b)(vi))) or (ii) the
Administrative Agent’s good faith determination that there exists excess Cash
Collateral; provided, however, (x) that Cash Collateral
furnished by or on behalf of the Borrower shall not be released during the
continuance of a Default or Event of Default (and following application as
provided in this Section 2.15 may be otherwise applied in
accordance with Section 8.03), and (y) the Person providing
Cash 

 

39

 

Collateral and the applicable L/C Issuer, may agree that Cash
Collateral shall not be released but instead held to support future anticipated
Fronting Exposure or other obligations.

 

2.15        Defaulting Lenders.  (a)     Adjustments.  Notwithstanding anything to the contrary
contained in this Agreement, if any Lender becomes a Defaulting Lender, then,
until such time as that Lender is no longer a Defaulting Lender, to the extent
permitted by applicable Law:

 

(i)            Waivers and Amendments.  That Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement
shall be restricted as set forth in Section 10.01, Section 10.06
or otherwise hereunder.

 

(ii)           Reallocation of Payments.  Any payment of principal, interest, fees or
other amounts received by the Administrative Agent for the account of that
Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII
or otherwise, and including any amounts made available to the Administrative
Agent by that Defaulting Lender pursuant to Section 10.08), shall
be applied at such time or times as may be determined by the Administrative
Agent as follows: first, to the payment of any
amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts
owing by that Defaulting Lender to the L/C Issuers hereunder; third, if so determined by the Administrative Agent or
requested by any L/C Issuer or the Borrower, to be held as Cash Collateral for
future funding obligations of that Defaulting Lender of any participation in
any Letter of Credit, except to the extent not permitted under the terms of any agreement
(without giving effect to any provision thereof permitting a general basket of
liens) to which the Borrower is a party or is bound (other than any agreement
entered into with an Affiliate in which the Borrower has agreed to any such
restriction for the benefit of such Affiliate); fourth, as the Borrower may request (so long as no Default
or Event of Default exists), to the funding of any Loan in respect of which
that Defaulting Lender has failed to fund its portion thereof as required by
this Agreement, as determined by the Administrative Agent; fifth,
if so determined by the Administrative Agent and the Borrower, to be held in
a non-interest bearing deposit account and released in order to satisfy obligations of that Defaulting Lender to
fund Loans under this Agreement; sixth, to the
payment of any amounts owing to the Lenders or the L/C Issuers as a result of
any judgment of a court of competent jurisdiction obtained by any Lender or any
L/C Issuer against that Defaulting Lender as a result of that Defaulting Lender’s
breach of its obligations under this Agreement; seventh,
so long as no Default or Event of Default exists, to the payment of any amounts
owing to the Borrower as a result of any judgment of a court of competent
jurisdiction obtained by the Borrower against that Defaulting Lender as a result
of that Defaulting Lender’s breach of its obligations under this Agreement; and
eighth, to that Defaulting Lender or as
otherwise directed by a court of competent jurisdiction; provided that
if (x) such payment is a payment of the principal amount of any Loans or
L/C Borrowings in respect of which that Defaulting Lender has not fully funded
its appropriate share and (y) such Loans or L/C Borrowings were made at a
time when the conditions set forth in Section 4.02 were satisfied
or waived, such payment shall be applied solely to pay the Loans of, and L/C
Borrowings owed to, all non-Defaulting Lenders on a pro rata basis prior to
being applied to the payment of any Loans of, or L/C Borrowings owed to, that
Defaulting Lender.  Any payments,
prepayments or other 

 

40

 

amounts paid or payable to a Defaulting Lender that
are applied (or held) to pay amounts owed by a Defaulting Lender or to post
Cash Collateral pursuant to this Section 2.15(a)(ii) shall be
deemed paid to and redirected by that Defaulting Lender, and each Lender
irrevocably consents hereto.

 

(iii)          Certain Fees.  That Defaulting Lender (x) shall not be
entitled to receive any commitment fee pursuant to Section 2.08(a) for
any period during which that Lender is a Defaulting Lender (and the Borrower
shall not be required to pay any such fee that otherwise would have been
required to have been paid to that Defaulting Lender)  and (y) shall
be limited in its right to receive Letter of Credit Fees as provided in Section 2.03(h).

 

(iv)          Reallocation of Applicable
Percentages to Reduce Fronting Exposure. 
During any period in which there is a Defaulting Lender, for purposes of
computing the amount of the obligation of each non-Defaulting Lender to
acquire, refinance or fund participations in Letters of Credit pursuant to Section 2.03,
the “Applicable Percentage” of each non-Defaulting Lender shall be computed
without giving effect to the Commitment of that Defaulting Lender; provided
that, (i) each such reallocation shall be given effect only if, at the
date the applicable Lender becomes a Defaulting Lender, no Default or Event of
Default exists; and (ii) the aggregate obligation of each non-Defaulting
Lender to acquire, refinance or fund participations in Letters of Credit shall
not exceed the positive difference, if any, of (1) the Commitment of that
non-Defaulting Lender minus (2) the aggregate Outstanding Amount of
the Loans of that Lender.

 

(b)           Defaulting
Lender Cure.  If the Borrower, the Administrative Agent
and the L/C Issuers agree in writing in their sole discretion that a Defaulting
Lender should no longer be deemed to be a Defaulting Lender, the Administrative
Agent will so notify the parties hereto, whereupon as of the effective date
specified in such notice and subject to any conditions set forth therein (which
may include arrangements with respect to any Cash Collateral), that Lender
will, to the extent applicable, purchase that portion of outstanding Loans of
the other Lenders or take such other actions as the Administrative Agent may
determine to be necessary to cause the Loans and funded and unfunded
participations in Letters of Credit to be held on a pro rata basis by the
Lenders in accordance with their Applicable Percentages (without giving effect to
Section 2.15(a)(iv)), whereupon that Lender will cease to be a
Defaulting Lender; provided that no adjustments will be made
retroactively with respect to fees accrued or payments made by or on behalf of
the Borrower while that Lender was a Defaulting Lender; and provided, further,
that except to the extent otherwise expressly agreed by the affected parties,
no change hereunder from Defaulting Lender to Lender will constitute a waiver
or release of any claim of any party hereunder arising from that Lender’s
having been a Defaulting Lender.

 

ARTICLE III.        TAXES, YIELD
PROTECTION AND ILLEGALITY

 

3.01        Taxes.

 

(a)           Payments
Free of Taxes; Obligation to Withhold; Payments on Account of Taxes.  (i) Any and all payments by or on
account of any obligation of the Borrower hereunder or under any other Loan
Document shall to the extent permitted by applicable Laws be made free and
clear of and without reduction or withholding for any Taxes.  If, however, applicable Laws 

 

41

 

require the Borrower or the Administrative Agent to withhold or deduct
any Tax, such Tax shall be withheld or deducted in accordance with such Laws as
determined by the Borrower or the Administrative Agent, as the case may be,
upon the basis of the information and documentation to be delivered pursuant to
subsection (e) below.

 

(ii)           If the Borrower or the Administrative
Agent shall be required by law to withhold or  deduct
any Taxes, including both United States Federal backup withholding and
withholding Taxes, from any payment, then (A) the Administrative Agent
shall withhold or make such deductions as are determined by the Administrative
Agent to be required based upon the information and documentation it has
received pursuant to subsection (e) below, (B) the Administrative
Agent shall timely pay the full amount withheld or deducted to the relevant
Governmental Authority in accordance with the requirements of law, and (C) to
the extent that the withholding or deduction is made on account of Indemnified
Taxes or Other Taxes, the sum payable by the Borrower shall be increased as
necessary so that after any required withholding or the making of all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent, the applicable Lender or the applicable
L/C Issuer, as the case may be, receives an amount equal to the sum it would
have received had no such withholding or deduction been made.

 

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

 

(c)           Tax
Indemnifications.  (i) Without
limiting or duplicating the provisions of subsection (a) or (b) above,
the Borrower shall, and does hereby, indemnify the Administrative Agent, each
Lender and each L/C Issuer, and shall make payment in respect thereof within 30
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, such Lender or such L/C Issuer, 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; provided that the Administrative Agent, such Lender and such
L/C Issuer, as the case may be, shall have provided to the Borrower a
certificate, reasonably satisfactory to the Borrower, evidencing the payment of
such amounts and setting forth in reasonable detail the calculations of such
amounts.  The Administrative Agent and
each Lender and L/C Issuer shall notify the Borrower of any events that would
entitle such Person to any amounts under this subsection (c) as soon as
reasonably practicable.  A certificate as
to the amount of any such payment or liability delivered to the Borrower by a
Lender or an L/C Issuer (with a copy to the Administrative Agent), or by the
Administrative Agent on its own behalf or on behalf of a Lender or an L/C
Issuer, shall be conclusive absent manifest error.

 

(ii)           Without limiting the provisions of
subsection (a) or (b) above, each Lender and each L/C Issuer shall,
and does hereby, indemnify the Borrower and the Administrative Agent, and shall
make payment in respect thereof within 10 days after demand therefor, against
any and all Taxes and any and all related losses, claims, 

 

42

 

liabilities, penalties, interest and expenses
(including the fees, charges and disbursements of any counsel for the Borrower
or  the Administrative Agent) incurred by
or asserted against the Borrower or the Administrative Agent by any
Governmental Authority as a result of the failure by such Lender or such L/C
Issuer, as the case may be, to deliver, or as a result of the inaccuracy,
inadequacy or deficiency of, any documentation required to be delivered by such
Lender or such L/C Issuer, as the case may be, to the Borrower or the
Administrative Agent pursuant to subsection (e).  Each Lender and each L/C Issuer hereby
authorizes the Administrative Agent to set off and apply any and all amounts at
any time owing to such Lender or such L/C Issuer, as the case may be, under
this Agreement or any other Loan Document against any amount due to the
Administrative Agent under this clause (ii). 
The agreements in this clause (ii) shall survive the resignation
and/or replacement of the Administrative Agent, any assignment of rights by, or
the replacement of, a Lender or an L/C Issuer, the termination of the Aggregate
Commitments and the repayment, satisfaction or discharge of all other
Obligations.

 

(d)           Evidence
of Payments.  Upon
request by the Borrower or the Administrative Agent, as the case may be, after
any payment of Taxes by the Borrower or by the Administrative Agent to a
Governmental Authority as provided in this Section 3.01, the
Borrower shall deliver to the Administrative Agent or the Administrative Agent
shall deliver to the Borrower, as the case may be, the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of any return required by Laws to report such payment or other evidence
of such payment reasonably satisfactory to the Borrower or the Administrative
Agent, as the case may be.

 

(e)           Status
of Lenders; Tax Documentation.  (i) 
The Administrative Agent and each Lender and L/C Issuer shall deliver to the
Borrower and to the Administrative Agent, on the date it becomes a party to
this Agreement, at the time or times prescribed by applicable Laws and when
reasonably requested by the Borrower or the Administrative Agent, such properly
completed and executed documentation prescribed by applicable Laws or by the
taxing authorities of any jurisdiction and such other reasonably requested
information as will permit the Borrower or the Administrative Agent, as the
case may be, to determine (A) whether or not payments made hereunder or
under any other Loan Document are subject to Taxes, (B) if applicable, the
required rate of withholding or deduction, and (C) such Lender’s
entitlement to any available exemption from, or reduction of, applicable Taxes
in respect of all payments to be made to the Administrative Agent or such
Lender or L/C Issuer by the Borrower pursuant to this Agreement or otherwise to
establish the Administrative Agent’s or such Lender’s or L/C Issuer’s status
for withholding tax purposes in the applicable jurisdiction.

 

(ii)           Without limiting the generality of
the foregoing,

 

(A)          the Administrative Agent and any
Lender or L/C Issuer that is a “United States person” within the meaning of Section 7701(a)(30)
of the Code shall deliver to the Borrower and the Administrative Agent duly
completed and executed originals of Internal Revenue Service Form W-9 or
such other documentation or information prescribed by applicable Laws or
reasonably requested by the Borrower or the Administrative Agent as will enable
the Borrower or the Administrative Agent, as the case may be, to determine
whether 

 

43

 

or not such Lender is subject to backup withholding or
information reporting requirements; and

 

(B)           each Foreign Lender that is entitled
under the Code or any applicable treaty to an exemption from or reduction of
withholding tax with respect to payments hereunder or under any other Loan
Document 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 and executed
originals 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 and executed originals
of Internal Revenue Service Form W-8ECI,

 

(III)         duly completed and executed originals
of Internal Revenue Service Form W-8IMY and all required supporting
documentation,

 

(IV)         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) executed originals of  Internal Revenue Service Form W-8BEN, or

 

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

 

(iii)          The Administrative Agent and each
Lender and L/C Issuer shall promptly (A) notify the Borrower and the
Administrative Agent of any change in circumstances which would modify or
render invalid any claimed exemption or reduction, and (B) take such steps
as shall not be materially disadvantageous to it, in the reasonable judgment of
the Administrative Agent, such Lender or such L/C Issuer, as applicable, and as
may be reasonably necessary (including the re-designation of its Lending
Office) to avoid any requirement of applicable Laws of any jurisdiction that
the Borrower or the Administrative Agent make any withholding or deduction for
taxes from amounts payable to such Lender.

 

44

 

(f)            Treatment
of Certain Refunds.  Unless required
by applicable Laws, at no time shall the Administrative Agent have any
obligation to file for or otherwise pursue on behalf of a Lender or an L/C
Issuer, or have any obligation to pay to any Lender or any L/C Issuer, any
refund of Taxes withheld or deducted from funds paid for the account of such
Lender or such L/C Issuer, as the case may be. 
If the Administrative Agent, any Lender or any L/C Issuer determines, in
its sole discretion, that it has received a refund, credit or other benefit in
respect 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, credit or other benefit (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, credit or other
benefit), net of all reasonable out-of-pocket expenses incurred by the
Administrative Agent, such Lender or such L/C Issuer, 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, such Lender or such L/C Issuer, agrees
to repay the amount paid over to the Borrower to the Administrative Agent, such
Lender or such L/C Issuer in the event the Administrative Agent, such Lender or
such L/C Issuer is required to repay such refund, credit or other benefit to
such Governmental Authority.  This
subsection shall not be construed to require the Administrative Agent, any
Lender or any L/C Issuer 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 make, maintain or fund Loans whose interest is
determined by reference to the Eurodollar Rate, or to determine or charge
interest rates based upon the Eurodollar 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, (i) any obligation of such Lender to make or continue Eurodollar
Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans shall be
suspended, and (ii) if such notice asserts the illegality of such Lender
making or maintaining Base Rate Loans the interest rate on which is determined
by reference to the Eurodollar Rate component of the Base Rate, the interest
rate on which Base Rate Loans of such Lender shall, if necessary to avoid such
illegality, be determined by the Administrative Agent in accordance with this
Agreement without reference to the Eurodollar Rate component of the Base Rate,
in each case 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, (x) the
Borrower shall, upon demand from such Lender (with a copy to the Administrative
Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such
Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such
Lender shall, if necessary to avoid such illegality, be determined by the
Administrative Agent in accordance with this Agreement without reference to the
Eurodollar Rate component of the Base Rate), either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurodollar Rate Loans and (y) if such
notice asserts the illegality of such Lender determining or charging interest
rates based upon the Eurodollar Rate, the Administrative Agent shall during the
period of such suspension compute the Base Rate 

 

45

 

applicable to such Lender in accordance with this Agreement without
reference to the Eurodollar Rate component thereof until the Administrative is
advised in writing by such Lender that it is no longer illegal  for such Lender to determine or charge
interest rates based upon the Eurodollar Rate. 
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 Eurodollar Rate Loan or a
conversion to or continuation thereof that (a) Dollar deposits are not
being offered to banks in the London interbank eurodollar market for the
applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate
and reasonable means do not exist for determining the Eurodollar Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan or in
connection with an existing or proposed Base Rate Loan, or (c) the
Eurodollar Rate for any requested Interest Period with respect to a proposed
Eurodollar 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, (x) the obligation of the Lenders to make or maintain
Eurodollar Rate Loans shall be suspended, and (y) in the event of a
determination described in the preceding sentence with respect to the
Eurodollar Rate component of the Base Rate, the utilization of the Eurodollar
Rate component in determining the Base Rate shall be suspended, in each case
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,
conversion to or continuation of Eurodollar 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; Reserves on Eurodollar Rate Loans.

 

(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 contemplated by Section 3.04(e))
or any L/C Issuer;

 

(ii)           subject any Lender or any L/C Issuer
to any tax of any kind whatsoever with respect to this Agreement, any Letter of
Credit, any participation in a Letter of Credit or any Eurodollar Rate Loan
made by it, or change the basis of taxation of payments to such Lender or such
L/C Issuer 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 such L/C Issuer); or

 

(iii)          impose on any Lender or any L/C Issuer
or the London interbank market any other condition, cost or expense affecting
this Agreement or Eurodollar Rate Loans made by such Lender or any Letter of
Credit or participation therein (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 such L/C Issuer);

 

46

 

and the result of any of
the foregoing shall be to increase the cost to such Lender, by an amount which
such Lender deems to be material in its sole discretion, of making or
maintaining any Loan the interest on which is determined by reference to the
Eurodollar Rate (or of maintaining its obligation to make any such Loan), or to
increase the cost to such Lender or such L/C Issuer of participating in,
issuing or maintaining any Letter of Credit (or of maintaining its obligation
to participate in or to issue any Letter of Credit), or to reduce the amount of
any sum received or receivable by such Lender or such L/C Issuer hereunder
(whether of principal, interest or any other amount) then, upon request of such
Lender or such L/C Issuer, the Borrower will pay to such Lender or such L/C
Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or such L/C Issuer, as the case may be, for such
additional costs incurred or reduction suffered; provided that such
additional costs incurred and reductions suffered shall be determined by such
Lender’s or L/C Issuer’s, as the case may be, reasonable allocation of the
aggregate additional cost incurred or reduction suffered due to such events
that are allocable to this Agreement.  If
the Borrower so notifies the Administrative Agent within five Business Days
after any Lender notifies the Borrower of any additional cost incurred or
reduction suffered pursuant to the foregoing provisions of this Section, the
Borrower may convert all Eurodollar Rate Loans of such Lender then outstanding into
Base Rate Loans in accordance with the terms hereof.

 

(b)           Capital
Requirements.  If any Lender or any
L/C Issuer determines that any Change in Law affecting such Lender or such L/C
Issuer or any Lending Office of such Lender or such Lender’s or such L/C Issuer’s
holding company, if any, regarding capital requirements has or would have the
effect of reducing the rate of return on such Lender’s or such L/C Issuer’s
capital or on the capital of such Lender’s or such L/C Issuer’s holding
company, if any, as a consequence of this Agreement, the Commitment of such
Lender or the Loans made by, or participations in Letters of Credit held by,
such Lender, or the Letters of Credit issued by such L/C Issuer, to a level
below that which such Lender or such L/C Issuer or such Lender’s or such L/C
Issuer’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s or such L/C Issuer’s policies and the policies
of such Lender’s or such L/C Issuer’s holding company with respect to capital
adequacy), by an amount deemed by such Lender or such L/C Issuer to be material
in its sole discretion, then from time to time, upon the request of such Lender
or L/C Issuer, the Borrower will pay to such Lender or such L/C Issuer, as the
case may be, such additional amount or amounts as will compensate such Lender
or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company for
any such reduction suffered that such Lender or such L/C Issuer reasonably
determines is allocable to this Agreement.

 

(c)           Certificates
for Reimbursement.  Each Lender and
L/C Issuer shall notify the Borrower of any Change in Law that would entitle
such Person to any amount under subsection (a) or (b) of this Section as
soon as reasonably practicable and promptly thereafter deliver to the Borrower
a written certificate setting forth the amounts due under such subsections and
setting forth in reasonable detail the calculations upon which such amounts
were determined.  A certificate of a
Lender or an L/C Issuer setting forth the amount or amounts necessary to
compensate such Lender or such L/C Issuer 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 or such
L/C Issuer, as the 

 

47

 

case may be, the amount shown as due on any such certificate within 20
days after receipt thereof.

 

(d)           Delay
in Requests.  Failure or delay on the
part of any Lender or any L/C Issuer to demand compensation pursuant to the
foregoing provisions of this Section shall not constitute a waiver of such
Lender’s or such L/C Issuer’s right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender or an L/C Issuer
pursuant to the foregoing provisions of this Section for any increased
costs incurred or reductions suffered more than four months prior to the date
that such Lender or such L/C Issuer, as the case may be, notifies the Borrower
of the Change in Law giving rise to such increased costs or reductions and of
such Lender’s or such L/C Issuer’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 four-month period referred to above shall
be extended to include the period of retroactive effect thereof).

 

(e)           Reserves
on Eurodollar Rate Loans.  The
Borrower shall pay to each Lender, as long as such Lender shall be required to
maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), additional interest on the unpaid principal amount of each
Eurodollar Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive absent manifest error), which shall be due
and payable on each date on which interest is payable on such Loan; provided
that the Borrower shall have received at least 10 days’ prior notice (with a
copy to the Administrative Agent) of such additional interest from such
Lender.  If a Lender fails to give notice
10 days prior to the relevant Interest Payment Date, such additional interest
shall be due and payable 10 days from receipt of such notice.

 

3.05        Compensation
for Losses.  Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:

 

(a)           any
continuation, conversion, payment or prepayment of any Eurodollar Rate Loan on
a day other than the last day of the Interest Period for such Loan (whether
voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

 

(b)           any
failure by the Borrower (for a reason other than the failure of such Lender to
make a Loan) to prepay, borrow, continue or convert any Eurodollar Rate Loan on
the date or in the amount notified by the Borrower; or

 

(c)           any
assignment of a Eurodollar Rate Loan on a day other than the last day of the
Interest Period therefor as a result of a request by the Borrower pursuant to Section 10.13;

 

including any loss of anticipated profits and any loss or expense
arising from the liquidation or reemployment of funds obtained by it to
maintain such Loan or from fees payable to terminate the deposits from which
such funds were obtained.  The Borrower
shall also pay any customary administrative fees charged by such Lender in
connection with the foregoing.

 

48

 

For purposes of
calculating amounts payable by the Borrower to the Lenders under this Section 3.05,
each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it
at the Eurodollar Rate for such Loan by a matching deposit or other borrowing
in the London interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.

 

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, any L/C Issuer, or any Governmental
Authority for the account of any Lender or
any L/C Issuer pursuant to Section 3.01, or if any Lender
gives a notice pursuant to Section 3.02, then such Lender or such
L/C Issuer shall, as applicable, 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 reasonable judgment of such Lender or such L/C Issuer, 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 or such L/C Issuer, as the case may be, to any unreimbursed cost
or expense and would not otherwise be disadvantageous to such Lender or such
L/C Issuer, as the case may be.  The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
Lender or any L/C Issuer in
connection with any such designation or assignment.

 

(b)                                 Replacement
of Lenders.  If any Lender requests
compensation under Section 3.04 or gives a notice under Section 3.02,
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, repayment of all other
Obligations hereunder, and resignation of the Administrative Agent.

 

ARTICLE IV.                       CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

4.01                        Conditions
of Initial Credit Extension.  The
obligation of each L/C Issuer and 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 or electronic copies (followed promptly by originals)
unless otherwise specified, each properly executed by a Responsible Officer of
the Borrower, as applicable, 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;

 

49

 

(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 the Borrower 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;

 

(iv)                              such
documents and certifications as the Administrative Agent may reasonably require
to evidence that the Borrower is duly organized or formed, and that the
Borrower is validly existing, in good standing and qualified to engage in
business in the jurisdiction where it is organized;

 

(v)                                 written
opinion(s) of counsel to the Borrower, addressed to the Administrative
Agent and each Lender, in the forms set forth as Exhibit E;

 

(vi)                              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 and (B) the current Ratings; and

 

(vii)                           evidence
that the Existing Credit Agreement has been or concurrently with the Closing
Date is being terminated and all Liens securing obligations under the Existing
Credit Agreement have been or concurrently with the Closing Date are being
released.

 

(b)                                 Any
fees required to be paid on or before the Closing Date shall have been paid to
the extent invoiced at least one Business Day prior to the Closing Date.

 

(c)                                  Unless
waived by the Administrative Agent and subject to the provisions of the Fee
Letter, the Borrower shall have paid all reasonable fees, charges and
disbursements of counsel due to the Administrative Agent (directly to such
counsel if requested by the Administrative Agent) to the extent invoiced at
least one Business Day prior to the Closing Date.

 

Without limiting
the generality of the provisions of the last paragraph of Section 9.03,
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 and each L/C Issuer to honor any Request for Credit
Extension (other than a Loan Notice requesting only a conversion of Loans to
the other Type, or a continuation of Eurodollar Rate Loans) is subject to the
following conditions precedent:

 

(a)                                  The
representations and warranties of the Borrower contained in Article V
shall be true and correct in all material respects on and as of the date of
such Credit Extension, except 

 

50

 

that (i) if a qualifier relating to materiality, Material Adverse
Effect or a similar concept applies, such representation or warranty shall be
required to be true and correct in all respects, (ii) to the extent that
such representations and warranties specifically refer to an earlier date, in
which case they shall be true and correct in all material respects as of such
earlier date (except that if a qualifier relating to materiality, Material
Adverse Effect or a similar concept applies, such representation or warranty
shall be required to be true and correct in all respects), (iii) 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. and (iv) the
representation and warranty contained in Section 5.05(c) does
not need to be true and correct for any Borrowing the proceeds of which are
used to repay outstanding commercial paper.

 

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

 

(c)                                  The
Borrower has all approvals, consents and authorizations from The Public
Utilities Commission of Ohio which are necessary or required in order to permit
the Borrower to incur Obligations hereunder.

 

(d)                                 The
Administrative Agent and, if applicable, the applicable L/C Issuer 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 or a continuation of Eurodollar Rate Loans) submitted
by the Borrower shall be deemed to be a representation and warranty that the
conditions specified in Sections 4.02(a), (b) and (c) 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.  The
Borrower (a) is duly organized, validly existing and, as applicable, in
good standing under the Laws of the jurisdiction of its incorporation, (b) has
all requisite 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, 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 clause (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 the Borrower of each Loan Document, have been duly
authorized by all necessary corporate action, and do not and will not (a) contravene
the terms of any of the Borrower’s Organization Documents; (b) conflict
with or result in any contravention of, or the creation of any Lien under, or
require any payment to be made under (i) any Contractual Obligation to
which the Borrower is a party or the Borrower or the properties of the Borrower
or any of its Subsidiaries is bound or 

 

51

 

(ii) any order, injunction, writ or decree of any Governmental
Authority or any arbitral award to which the Borrower or its property is
subject; or (c) violate any Law, except in any case referred to in clause (b) or
(c), to the extent the failure to do so 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, the Borrower of this Agreement or any other Loan Document,
except for such approvals, consents, exemptions, authorizations, actions,
notices and filings (a) that have been obtained or made on or before the
Closing Date and are in full force and effect and (b) from The Public
Utilities Commission of Ohio which are necessary or required in order to permit
the Borrower to incur Obligations hereunder after December 31, 2010.

 

5.04                        Binding
Effect.  This Agreement has been, and
each other Loan Document, when delivered hereunder, will have been, duly
executed and delivered by the Borrower. 
This Agreement constitutes, and each other Loan Document when so delivered
will constitute, a legal, valid and binding obligation of the Borrower,
enforceable against the Borrower in accordance with its terms, subject to
Debtor Relief Laws and general equity and public policy principles.

 

5.05                        Financial
Statements; No Material Adverse Effect.

 

(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 (other than any liability incident to any
litigation, arbitration or proceeding that could not reasonably be expected to
have a Material Adverse Effect).

 

(b)                                 The
unaudited consolidated balance sheets
of the Borrower and its Subsidiaries dated September 30, 2009, and the
related consolidated statements of income or operations, shareholders’ equity
and cash flows for the fiscal quarter 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.

 

52

 

5.06                        Litigation.

 

(a)                                  There are no actions, suits,
proceedings, claims or disputes pending or, to the knowledge of the Borrower,
threatened, at law, in equity, in arbitration or before any Governmental
Authority, by or against the Borrower or any of its Subsidiaries that (a) question
the validity or the enforceability of the Loan Documents, or any of any action
to be taken by the Borrower pursuant to any of the Loan Documents, or (b) either
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

 

(b)                                 No action, suit, proceeding or investigation
has been instituted, or to the knowledge of the Borrower or any of its
Subsidiaries, threatened, and no rule, regulation, order, judgment or decree
has been issued or proposed to be issued by any Governmental Authority that,
solely as a result of the incurrence of Obligations or the entering into this
Agreement or any other Loan Document or any transaction contemplated hereby or
thereby, would cause or deem the Administrative Agent, any Lenders or any of
their respective Affiliates to be subject to, or not exempted from, regulation
under the FPA.

 

5.07                        No
Default.  The Borrower and each
Subsidiary are in full compliance with all material terms, covenants and
conditions of each of its Contractual Obligations, except for any noncompliance
that could not, either individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.  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.  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 or interest as could
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

5.09                        Environmental
Compliance.  The Borrower and each of
its Subsidiaries is in compliance with all Environmental Laws governing its
business, except to the extent that any such failure to comply (together with
any resulting penalties, fines or forfeitures) would not reasonably be expected
to have a Material Adverse Effect.  All
licenses, permits, registrations or approvals required for the conduct of the
business of the Borrower and each of its Subsidiaries under any Environmental
Law have been secured and the Borrower and each of its Subsidiaries is in
substantial compliance therewith, except for such licenses, permits,
registrations or approvals the failure to secure or to comply therewith is not
reasonably likely to have a Material Adverse Effect.  Neither the Borrower nor any of its
Subsidiaries has received written notice, or otherwise knows, that it is in any
respect in noncompliance with, breach of or default under any applicable writ,
order, judgment, injunction, or decree to which the Borrower or such Subsidiary
is a party or that would affect the ability of the Borrower or such Subsidiary
to operate any real property and no event has occurred and is continuing that,
with the passage of time or the giving of notice or both, would constitute
noncompliance, breach of or default thereunder, except in each such case, such
noncompliance, breaches or defaults as would not reasonably be expected to, in
the aggregate, have a Material Adverse Effect. 
There are no environmental claims pending or, to the best knowledge of
the Borrower, threatened wherein an unfavorable decision, ruling or finding
would reasonably be expected to have a Material Adverse Effect.  There are no facts, 

 

53

 

circumstances, conditions or occurrences on any real property now or at
any time owned, leased or operated by the Borrower or any of its Subsidiaries
or on any Property adjacent to any such real property, that are known by the
Borrower or as to which the Borrower or any such Subsidiary has received
written notice, that could reasonably be expected:  (i) to form the basis of an
environmental claim against the Borrower or any of its Subsidiaries or any real
property of the Borrower or any of its Subsidiaries; or (ii) to cause such
real property to be subject to any restrictions on the ownership, occupancy,
use or transferability of such real property under any Environmental Law,
except in each such case, such environmental claims or restrictions that
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect.

 

5.10                        Insurance.  The properties of the Borrower and its
Subsidiaries are insured pursuant to policies and other bonds which are valid
and in full force and effect and which provide adequate coverage from reputable
and financially sound insurers in amounts sufficient to insure the assets and
risks of the Borrower and each such Subsidiary in accordance with prudent
business practice in the  industry of such
Borrower and Subsidiaries, except where the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.

 

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 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 or the non-payment
of which, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.  To
the Borrower’s knowledge, 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.  Neither the Borrower nor any ERISA Affiliate
has, or has at any time during the preceding six years had, an obligation to
contribute to a Multiemployer Plan.  Each
Pension Plan that is intended to be a qualified plan under Section 401(a) of
the Code has received a favorable determination letter from the Internal
Revenue Service to the effect that the form of such Plan is qualified under Section 401(a) of
the Code and the trust related thereto has been determined by the Internal
Revenue Service to be exempt from federal income tax under Section 501(a) of
the Code, or an application for such a letter is currently being processed by
the Internal Revenue Service.  To the
best knowledge of the Borrower, nothing has occurred that would prevent or
cause the loss of such tax-qualified status.

 

(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 nonexempt 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.

 

54

 

(c)                                  (i) No
ERISA Event has occurred, and neither the Borrower nor any ERISA Affiliate is
aware of any fact, event or circumstance that could reasonably be expected to
constitute or result in an ERISA Event with respect to any Pension Plan; (ii) the
Borrower and each ERISA Affiliate has met in all material respects all
applicable requirements under the Pension Funding Rules in respect of each
Pension Plan, and no waiver of the minimum funding standards under the Pension
Funding Rules has been applied for or obtained; (iii) as of the most
recent valuation date for any Pension Plan, the funding target attainment
percentage (as defined in Section 430(d)(2) of the Code) is 60% or
higher and neither the Borrower nor any ERISA Affiliate knows of any facts or
circumstances that could reasonably be expected to cause the funding target
attainment percentage for any such plan to drop below 60% as of the most recent
valuation date; (iv) neither the Borrower nor any ERISA Affiliate has
incurred any liability to the PBGC other than for the payment of premiums, and
there are no premium payments which have become due that are unpaid; (v) neither
the Borrower nor any ERISA Affiliate has engaged in a transaction that could be
subject to Section 4069 or Section 4212(c) of ERISA; and (vi) no
Pension Plan has been terminated by the plan administrator thereof nor by the
PBGC, and no event or circumstance has occurred or exists that could reasonably
be expected to cause the PBGC to institute proceedings under Title IV of ERISA
to terminate any Pension Plan.

 

5.13                        Subsidiaries.  As of the Closing Date, the Borrower has no
Subsidiaries.

 

5.14                        Margin
Regulations; Investment Company Act; Federal Power 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.

 

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

 

(c)                                  None
of the Borrower or any of its Subsidiaries, or any Affiliate of any of them, is
subject to regulation under the FPA or under applicable state or other Laws
respecting the rates or the financial or organizational regulation of electric
utilities, as a result of the creation or incurrence of the Obligations or
entering into this Agreement or any other Loan Document or the consummation of
any transaction contemplated hereby or thereby.

 

5.15                        Disclosure.  No report, financial statement, certificate
or other information (other than information of a general economic nature or
industry nature) furnished by or on behalf of the Borrower to the
Administrative Agent or any Lender in writing in connection with the
transactions contemplated hereby or delivered hereunder 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 (taken as a whole), 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 to be reasonable at the time; it being recognized by the
Administrative Agent and the 

 

55

 

Lenders that such projections as to future events are
not to be viewed as facts and that actual results during the period or periods
covered by any such projections may differ materially from the projected
results.

 

5.16                        Compliance
with Laws.  The Borrower and each
Subsidiary 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                        Intellectual
Property; Licenses, Etc.  The
Borrower and its Subsidiaries own, or possess the right to use, all of the
material trademarks, service marks, trade names, copyrights, patents, patent
rights, franchises, licenses and other intellectual property rights
(collectively, “IP Rights”) that are necessary for the operation of
their respective businesses, without any known conflict with the rights of any
other Person, except for any IP Rights or any conflicts that, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.

 

5.18                        Solvency.  The Borrower is not insolvent as defined in
any applicable state or federal statute, nor will the Borrower be rendered
insolvent by the execution and delivery of this Agreement or any other Loan
Document to the Administrative Agent and the Lenders or the performance of its
obligations hereunder or thereunder.

 

5.19                        Employment
Matters.  The Borrower is in
compliance with all employment agreements, employment contracts, collective
bargaining agreements and other agreements between the Borrower and its
employees (collectively, “Labor Contracts”) and all applicable Federal,
state and local labor and employment Laws including those related to equal
employment opportunity and affirmative action, labor relations, minimum wage,
overtime, child labor, medical insurance continuation, worker adjustment and
retraining notices, immigration controls and worker and unemployment
compensation, where the failure to comply would constitute a Material Adverse
Effect.  There are no outstanding
grievances, arbitration awards or appeals therefrom arising out of the Labor
Contracts or current or threatened strikes, picketing, handbilling or other
work stoppages or slowdowns at facilities of the Borrower which in any
case would constitute a Material Adverse Effect.

 

ARTICLE VI.                       AFFIRMATIVE COVENANTS

 

So long as any
Lender shall have any Commitment hereunder, any Loan or other Obligation
relating solely to the payment of principal or interest on any Loan or fees
payable hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, 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 Subsidiary to:

 

6.01                        Financial
Statements.  Deliver to the
Administrative Agent and each Lender:

 

56

 

(a)                                  as
soon as available, but in any event within 90 days after the end of each fiscal
year of the Borrower, a condensed consolidated balance sheet of the Borrower
and its Subsidiaries as at the end of such fiscal year, and the related condensed
consolidated statements of income or operations, changes in 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 condensed consolidated statements to be audited and
accompanied by a report and opinion of KPMG LLP or another independent
certified public accountant of nationally recognized standing selected by the
Borrower in its sole discretion, which report and opinion shall be prepared in
accordance with generally accepted auditing standards and shall not be subject
to any “going concern” or like material qualification or exception or any
material qualification or exception as to the scope of such audit; and

 

(b)                                 as
soon as available, but in any event within 45 days after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower, a condensed
consolidated balance sheet of the Borrower and its Subsidiaries as at the end
of such fiscal quarter, the related condensed consolidated statements of income
or operations for such fiscal quarter and for the portion of the Borrower’s
fiscal year then ended, and the related condensed consolidated statements of
cash flows for the portion of the Borrower’s fiscal year then ended, in each
case setting forth in comparative form, as applicable, 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 condensed consolidated statements to be
certified by a Responsible Officer 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, but the foregoing shall not be in derogation
of the obligation of the Borrower to furnish the information and materials
described in clauses (a) and (b) above at the times specified
therein.

 

6.02                        Certificates;
Other Information.  Deliver to the
Administrative Agent and each Lender:

 

(a)                                  concurrently
with the delivery of the financial statements referred to in Sections 6.01(a) and
(b), a duly completed Compliance Certificate signed by a Responsible
Officer of the Borrower (which delivery may, unless the Administrative Agent,
or a Lender requests executed originals, be by electronic communication
including fax or email and shall be deemed to be an original authentic
counterpart thereof for all purposes);

 

(b)                                 promptly
after the same are filed with the SEC, copies of all proxies which the Borrower
may file with the SEC under Section 14(a) of the Exchange Act and
copies of all annual, regular, periodic and special reports and registration
statements which the Borrower may file with the SEC under Section 13 or 15(d) of
the Exchange Act, and not otherwise required to be delivered to the
Administrative Agent pursuant hereto; and

 

57

 

(c)                                  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(b) or (c) (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 one or
more of the website addresses listed on Schedule 10.02; (ii) on
which such documents are posted to the SEC’s website at www.sec.gov or (iii) 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).

 

The Borrower
hereby acknowledges that (a) the Administrative Agent and/or the Arranger
will make available to the Lenders and the L/C Issuers 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 (each, a “Public Lender”) may have personnel who do not wish to
receive material non-public information with respect to the Borrower or its
Affiliates, or the respective securities of any of the foregoing, and who may
be engaged in investment and other market-related activities with respect to
such Persons’ securities.  The Borrower
hereby agrees that (w) all Borrower Materials provided by the Borrower to
the Administrative Agent and/or the Arranger, which 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, the L/C Issuers and the Lenders to treat such Borrower Materials as
not containing any material non-public information with respect to the Borrower
or its securities for purposes of United States Federal and state securities
laws (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 Side
Information;” 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
Side Information.”

 

6.03                        Notices.  Promptly, after an officer of the Borrower
has knowledge thereof, notify the Administrative Agent and each Lender:

 

(a)                                  of
the occurrence of any Default;

 

(b)                                 of
any (i) breach or non-performance of, or any default under, a Contractual
Obligation of the Borrower or any Subsidiary; (ii) any dispute,
litigation, investigation, proceeding or suspension between the Borrower or any
Subsidiary and any Governmental Authority; or (iii) the commencement of,
or any material development in, any litigation or 

 

58

 

proceeding affecting the Borrower or any Subsidiary, including pursuant
to any applicable Environmental Laws, in each case under any of the foregoing
clauses (i), (ii) and (iii) where such event could reasonably be
expected to have a Material Adverse Effect;

 

(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; and

 

(e)                                  of
any amendment to the Organization Documents of the Borrower filed by the
Borrower in the applicable office in the jurisdiction where it is organized.

 

Each notice
pursuant to this Section 6.03 (other than Sections 6.03(e) and (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 known by such Responsible Officer to have been breached.

 

6.04                        Payment
of Taxes and Claims.  Pay and
discharge prior to the date on which penalties attach thereto, (a) all
material tax liabilities, assessments and governmental charges or levies upon
it or its properties or assets, and (b) all lawful claims which, if
unpaid, would by law become a Lien upon its property not permitted hereunder,
in each case 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 or, in the case of
clause (b), the failure to pay or discharge could not reasonably be expected to
result in a Material Adverse Effect.

 

6.05                        Preservation
of Existence, Etc.  (a) Preserve,
renew and maintain in full force and effect its legal existence and good
standing under the Laws of the jurisdiction of its organization except in a
transaction permitted by Section 7.03 or 7.04; (b) 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 (c) 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.  (a) Maintain,
preserve and protect all of its 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 clauses (a) and (b) where
the failure to do so could not reasonably be expected to have a Material
Adverse Effect (it being understood that this covenant relates to only to the
good working order and repair of such property and equipment and shall not be
construed as a covenant not dispose of any such property or equipment by sale,
lease, transfer or otherwise or to discontinue operation thereof to the extent
not prohibited under this Agreement).

 

59

 

6.07                        Maintenance
of Insurance.  Maintain insurance
coverage by such insurers and in such forms and amounts and against such risks
as are generally consistent with the insurance coverage maintained by the
Borrower and its Subsidiaries at the date hereof, except where the failure to
do so could not reasonably be expected to result in a Material Adverse Effect.

 

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 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 material properties, and to discuss its affairs, finances
and accounts with its officers and independent public accountants (provided
that the Borrower shall be permitted to attend any such discussions with such
accountants) and, if a Default exists, to examine its books of records and
account and make copies thereof or abstracts therefrom, all at such reasonable
times during normal business hours and as often as may be reasonably desired,
upon reasonable advance notice to the Borrower; provided, however,
that unless an Event of Default has occurred and is continuing, the Borrower
shall not be required to permit more than one such visit, inspection or
examination during any calendar year. 
All costs and expenses incurred by the Administrative Agent or any
Lender in connection with any of the foregoing shall be paid by the
Administrative Agent or such Lender, as the case may be, unless an Event of
Default shall have occurred and be continuing at the time such costs and/or
expenses are incurred, in which case all such costs and expenses shall be paid
by the Borrower.  Subject to the proviso
above, in the event any Lender desires to visit and inspect the Borrower or any
of its Subsidiaries, such Lender shall make a reasonable effort to conduct such
visit and inspection contemporaneously with any visit and inspection to be
performed by the Administrative Agent or another Lender.  Notwithstanding anything to the contrary in
this Section 6.10, neither the Borrower nor any of its Subsidiaries
will be required to disclose, permit the inspection, examination or making
copies or abstracts of, or discussion of, any document, information or other
matter that (a) constitutes non-financial trade secrets or non-financial
proprietary information, (b) in respect of which disclosure to the
Administrative Agent (or its representatives) or any Lender (or its
representatives) is prohibited by Law or (c) is subject to attorney-client
or similar privilege or constitutes attorney work product.

 

6.11                        Use
of Proceeds.  Use the proceeds of the
Credit Extensions for general corporate purposes not in contravention of any
Law or of any Loan Document, including to provide liquidity to support the
issuance of commercial paper.

 

6.12                        Senior
Debt.  Ensure that (a) the
claims of the Administrative Agent and the Lenders in respect of the
Obligations of the Borrower will not be subordinate to, and will in all
respects rank at least pari passu with
or senior to, the claims of every unsecured creditor of the 

 

60

 

Borrower, and (b) any Indebtedness of the Borrower that is
subordinated in any manner to the claims of any other creditor of the Borrower
will be subordinated in like manner to such claims of the Administrative Agent
and the Lenders.

 

ARTICLE VII.                   NEGATIVE COVENANTS

 

So long as any
Lender shall have any Commitment hereunder, any Loan or other Obligation
relating solely to the payment of principal or interest on any Loan or fees
payable hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:

 

7.01                        Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, other than the following:

 

(a)                                  Liens
pursuant to any Loan Document;

 

(b)                                 Liens
existing on the date hereof and listed on Schedule 7.01 and any renewals
or extensions thereof, provided that the amount secured or benefited
thereby is not increased;

 

(c)                                  Liens
for Taxes, assessments or charges not yet delinquent or which are being
contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves with respect thereto are maintained in accordance with GAAP;

 

(d)                                 Liens
imposed by law, such as carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s or other like Liens arising in the ordinary course of business
which do not secure obligations overdue for a period of more than 60 days or which
are being contested in good faith and by appropriate proceedings diligently
conducted, if adequate reserves with respect thereto are maintained;

 

(e)                                  Liens,
pledges or deposits in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other social security
legislation, other than any Lien imposed by ERISA;

 

(f)                                    deposits
to secure the performance of bids, trade contracts and leases (other than
Indebtedness), statutory obligations, surety and appeal bonds, indemnity or
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

 

(g)                                 easements,
rights-of-way, zoning, restrictions or other similar encumbrances or
imperfections in title and obligations contained in similar instruments and
prior rights of other Persons which, do not materially interfere with the
ordinary conduct of the business of the Borrower and its Subsidiaries or could
not reasonably be expected to have a Material Adverse Effect;

 

(h)                                 Liens
securing judgments, decrees or attachments not constituting an Event of Default
under Section 8.01(h);

 

(i)                                     Liens
on property of the Borrower securing the Borrower’s First Mortgage Bonds issued
pursuant to the Indenture, dated as of October 1, 1935, as amended, supplemented
or 

 

61

 

otherwise modified from time to time, between the Borrower and The Bank
of New York Mellon (or its predecessors or successors);

 

(j)                                     Liens
on property of the Borrower in connection with collateralized pollution
control bonds;

 

(k)                                  Liens
on property of the Borrower in connection with any construction project or
generating plant as security for any Indebtedness incurred for the purpose of
financing all or part of such construction project or generating plant, and in
each case, Liens and charges incidental thereto; provided that the aggregate
amount of Indebtedness secured by Liens permitted pursuant to this
clause (k) shall not exceed $500,000,000;

 

(l)                                     banker’s
liens and rights of setoff arising by operation of law and contractual rights
of setoff;

 

(m)                               leases
or subleases granted in the ordinary course of business to others not
interfering in any material respect with the business of the Borrower and any
interest or title of a lessee under any lease not in violation of this
Agreement;

 

(n)                                 purported
Liens evidenced by the filing of precautionary Uniform Commercial Code
financing statements relating solely to operating leases of personal property
entered into in the ordinary course of business;

 

(o)                                 the
right reserved to, or vested in, any municipality or public authority by the
terms of any right, power, franchise, grant, license or permit, or any
provision of law, to purchase or capture or designate a purchaser of any
property;

 

(p)                                 Liens
with respect to cash collateral deposited by the Borrower with counterparties
in the ordinary course of Borrower’s purchase and sale of energy, power, coal
and other commodities;

 

(q)                                 Liens
arising from the rights of lessors under leases (including financing statements
regarding property subject to such lease) permitted under this Agreement; provided
that such Liens are only in respect of property subject to, and secure only,
the respective lease (and any other lease with the same or affiliated lessor);

 

(r)                                    any
(i) Lien existing on any property at the time such property is acquired by
the Borrower or any of its Subsidiaries or on any property of any Person at the
time such Person becomes, or is merged into, a Subsidiary of the Borrower; provided that (A) such Lien is
not created in contemplation of or in connection with such acquisition or such
Person becoming, or being merged into, such Subsidiary, as the case may be, (B) such
Lien shall not attach or apply to any other property or assets of the Borrower
or any of its Subsidiaries, and (C) such Lien shall secure only those
obligations that it secures on the date of such acquisition or the date such
Person becomes, or is merged into, such Subsidiary, as the case may be, and any
extension, renewal, refunding or refinancing thereof, so long as the aggregate
principal amount so extended, renewed, refunded or refinanced is not increased,
and (ii) Lien securing Indebtedness in respect of purchase money
obligations for the acquisition, lease, construction or improvement of fixed
assets or Capital Lease Obligations, provided  that (A) such Lien only attaches to
such fixed 

 

62

 

assets being acquired, leased, constructed or improved and (B) the
Indebtedness secured by such Lien does not exceed the cost or fair market
value, whichever is lower, of the fixed assets being acquired, leased,
constructed or improved on the date of acquisition, lease, construction or
improvement; provided that the aggregate principal amount
of Indebtedness at any time outstanding secured by a Lien described in this
subsection (r) shall not exceed an amount equal to 5% of the Consolidated
Tangible Assets at such time; and

 

(s)                                  Liens,
in addition to those listed above, securing Indebtedness and other obligations
in an aggregate amount at any time not exceeding the greater of (i) $50,000,000
and (ii) 2.5% of Consolidated Tangible Assets.

 

7.02                        Investments.  Make any Investments, except:

 

(a)                                  Investments
held by the Borrower or such Subsidiary in the form of cash or cash
equivalents;

 

(b)                                 loans
and advances to officers, directors and employees of the Borrower or any of its
Subsidiaries in an aggregate amount not to exceed $10,000,000 at any time
outstanding, for travel, entertainment, relocation, payroll, office equipment,
tuition and analogous ordinary business purposes;

 

(c)                                  Investments
of the Borrower in any Subsidiary and Investments of any Subsidiary in the
Borrower or in another Subsidiary;

 

(d)                                 Permitted
Acquisitions;

 

(e)                                  Investments
consisting of extensions of credit in the nature of accounts receivable or
notes receivable arising from the grant of trade credit in the ordinary course
of business, and Investments received in satisfaction or partial satisfaction
thereof from financially troubled account debtors and Investments in account
debtors received in connection with a proceeding under any Debtor Relief Laws
in settlement of the obligations of account debtors;

 

(f)                                    Promissory
notes, earn-outs, other contingent payment obligations and other non-cash consideration
received by the Borrower or any of its Subsidiaries as partial payment of the
total consideration of any Disposition made in accordance with Section 7.04(f);

 

(g)                                 Guarantees
of the Borrower or any Subsidiary in respect of Indebtedness of the Borrower or
any Subsidiary;

 

(h)                                 Investments
comprised of the purchase of receivables from other energy marketers as
required from time to time by one or more applicable Governmental Authorities;

 

(i)                                     Investments
existing on the date hereof and set forth on Schedule 7.02;

 

(j)                                     Investments
in investment-grade issuers that are held by the Borrower or any Subsidiary not
longer than eighteen months; and

 

63

 

(k)                                  other
Investments not otherwise permitted hereunder and not exceeding the greater of (i) $50,000,000
and (ii) 2.5% of Consolidated Tangible Assets, in the aggregate at any
time.

 

7.03                        Fundamental
Changes.  Merge, dissolve, liquidate,
consolidate with or into another Person, or Dispose of (whether in one transaction
or in a series of transactions) all or substantially all of its assets (whether
now owned or hereafter acquired) to or in favor of any Person, except that:

 

(a)                                  any
Subsidiary may merge, dissolve, liquidate or consolidate with or into (i) the
Borrower, provided that the Borrower shall be the continuing or
surviving Person, or (ii) any one or more other Subsidiaries;

 

(b)                                 any
Subsidiary may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or to another Subsidiary; provided
that if the transferor in such a transaction is a wholly-owned Subsidiary, then
the transferee must either be the Borrower or a wholly-owned Subsidiary;

 

(c)                                  the
Borrower may merge with any Person (other than a Subsidiary) in a transaction
permitted by Section 7.02(d); provided that (i) the
Borrower shall be the continuing or surviving Person and (ii) immediately
before and after such merger there shall not exist any Default or Event of
Default; and

 

(d)                                 any
Subsidiary may merge with any Person (other than the Borrower or a Subsidiary
in a transaction permitted by Section 7.02(d); provided that
(i) the Subsidiary shall be the continuing or surviving Person and (ii) immediately
before and after such merger there shall not exist any Default or Event of
Default.

 

7.04                        Dispositions.  Make any Disposition or enter into any
agreement to make any Disposition, except:

 

(a)                                  Dispositions
of obsolete or worn out property, whether now owned or hereafter acquired, in
the ordinary course of business;

 

(b)                                 Dispositions
of inventory in the ordinary course of business;

 

(c)                                  Dispositions
of equipment or real property to the extent that (i) such property is
exchanged for credit against the purchase price of similar replacement property
or (ii) the proceeds of such Disposition are reasonably promptly applied
to the purchase price of such replacement property;

 

(d)                                 Dispositions
of property by any Subsidiary to the Borrower or to a wholly-owned Subsidiary;

 

(e)                                  Dispositions
permitted by Sections 7.01, 7.02 and 7.03; and

 

(f)                                    Dispositions
by the Borrower and its Subsidiaries not otherwise permitted under this Section 7.04 so long as (A) the aggregate
amount (based upon the fair market value of the 

 

64

 

assets) of all property sold or otherwise
disposed pursuant to all such Dispositions on and after the Closing Date at the
time of and after giving effect to any such Disposition does not constitute a
Substantial Portion of the property of the Borrower and its Subsidiaries and (B) at
least 80% of the total consideration received by the Borrower or any of its
Subsidiaries, as applicable, for such Disposition or series of Dispositions
consists of cash or cash equivalents;

 

provided,
however, that any Disposition pursuant to clauses (a) through (f) shall
be for fair market value.

 

7.05                        Change
in Nature of Business.  Engage in any
business if, as a result, the general nature of the business, taken on a
consolidated basis, that would then be engaged in by the Borrower and its
Subsidiaries would be substantially changed from the general nature of the
business engaged in by the Borrower and its Subsidiaries on the Closing Date.

 

7.06                        Transactions
with Affiliates.  Enter into any
transaction of any kind 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 Subsidiary as would be
obtainable by the Borrower or such Subsidiary 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 (a) transactions between or
among the Borrower and any of its Subsidiaries or between and among any
Subsidiaries, (b) sales of goods by the Borrower or any of its
Subsidiaries to an Affiliate for use or distribution outside the United States
that in the good faith judgment of the Borrower complies with any applicable
legal requirements of the Code, or (c) agreements and transactions with
and payments to officers, directors and shareholders that are either (i) entered
into in the ordinary course of business and not prohibited by any of the
provisions of this Agreement or (ii) entered into outside the ordinary
course of business, approved by the directors or shareholders of the Borrower,
and not prohibited by any of the provisions of this Agreement.

 

7.07                        Burdensome
Agreements.  Enter into any
Contractual Obligation that limits the ability of any Subsidiary to make
Restricted Payments to the Borrower or to otherwise transfer property to the
Borrower, which could reasonably be expected to result in a Material Adverse
Effect.

 

7.08                        Swap
Agreements.  Enter into any Swap
Contract other than any Swap Contract entered into by such Person pursuant to
which such Person has hedged its reasonably estimated interest rate, foreign
currency or power and other commodity exposure, and not for speculative
purposes.

 

7.09                        Use
of Proceeds.  Use the proceeds of any
Credit Extension, whether directly or indirectly, and whether immediately,
incidentally or ultimately, to purchase or carry margin stock (within the
meaning of Regulation U of the FRB) or to extend credit to others for the
purpose of purchasing or carrying margin stock or to refund indebtedness originally
incurred for such purpose.

 

7.10                        Accounting
Changes.  Make any change in its
fiscal year.

 

7.11                        Financial
Covenant.  Permit the ratio of
Consolidated Total Debt to Consolidated Total Capitalization at any time to be
greater than 0.65 to 1.00.

 

65

 

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 fails to pay (i) when and
as required to be paid herein, any amount of principal of any Loan or any L/C
Obligation or (ii) within five days after the same becomes due, any
interest on any Loan or on any L/C Obligation, any fee due hereunder or under
any other Loan Document or 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, 6.03, 6.05, 6.10, 6.11 or 6.12
or Article VII; or

 

(c)                                  Other
Defaults.  The Borrower 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 notice
thereof from the Administrative Agent to the Borrower; or

 

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

 

(e)                                  Cross-Default.  (i) The Borrower or any Subsidiary (A) defaults
in any payment (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise and after applicable notices have been given
and grace periods have expired) in respect of any 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 $50,000,000, or (B) defaults
in the performance of any other agreement or condition relating to any such
Indebtedness or Guarantee or contained in any instrument or agreement
evidencing, securing or relating thereto (after all applicable notices have
been given and grace periods have expired), 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
and after all applicable grace periods have expired, 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;  provided that, notwithstanding
the foregoing, no default or other event described in either clause (A) or
(B) shall constitute an Event of Default so long as (1) the aggregate
principal amount outstanding (excluding undrawn committed or available amounts)
of all such Indebtedness and Guarantees is less than $25,000,000 and (2) no
holder of such Indebtedness or beneficiary of such Guarantee (or a trustee or
agent on behalf of a holder or beneficiary) has caused such Indebtedness to be
demanded or to become due or to be repurchased, prepaid, defeased or 

 

66

 

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, in the event any such holder or beneficiary has
caused any of the events described in this clause (2) to occur, such event
has not been resolved by such holder or beneficiary and the Borrower within 20
days of such event being caused; 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 the Borrower or any
Subsidiary 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 $50,000,000; or

 

(f)                                    Insolvency
Proceedings, Etc.  The Borrower or
any of its Subsidiaries 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 consecutive 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 consecutive
calendar days, or an order for relief is entered in any such proceeding; or

 

(g)                                 Inability
to Pay Debts.  The Borrower or any
Subsidiary becomes unable or admits in writing its inability to pay its debts
as they become due; or

 

(h)                                 Judgments.  There is entered against the Borrower or any
Subsidiary (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
$50,000,000 (to the extent not covered by third-party insurance as to which the
insurer does not dispute coverage), and (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a
period of 30 consecutive days during which a stay of enforcement of such
judgment, by reason of a pending appeal or otherwise, is not in effect; or

 

(i)                                     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, a Multiemployer Plan or the PBGC in an aggregate amount in
excess of $50,000,000, 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
$50,000,000; or

 

(j)                                     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 the

 

67

 

Borrower or any of its Affiliates contests in any
manner the validity or enforceability of any Loan Document; or the Borrower
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

 

(k)           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 and any obligation of any L/C Issuer to make L/C Credit
Extensions 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;

 

(c)           require that the Borrower Cash
Collateralize the L/C Obligations (in an amount equal to the then Outstanding
Amount thereof); and

 

(d)           exercise on behalf of itself, the
Lenders and the L/C Issuers all rights and remedies available to it, the
Lenders and the L/C Issuers 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 and any obligation of any L/C Issuer to make L/C
Credit Extensions shall automatically terminate, the unpaid principal amount of
all outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable, and the obligation of the Borrower to
Cash Collateralize the L/C Obligations as aforesaid shall automatically become
effective, 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 and the L/C
Obligations have automatically been required to be Cash Collateralized as set
forth in the proviso to Section 8.02), any amounts received on
account of the Obligations shall, subject to the provisions of Sections 2.14
and 2.15, 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 to the extent required to be reimbursed hereunder and amounts payable
under Article III) payable to the Administrative Agent in its
capacity as such;

 

Second, to payment of that portion of the
Obligations constituting fees, indemnities and other amounts (other than
principal, interest and Letter of Credit Fees) payable to the Lenders 

 

68

 

and the L/C
Issuers (including fees, charges and disbursements of counsel to the respective
Lenders and the L/C Issuers to the extent required to be reimbursed hereunder
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 Letter of Credit Fees and interest on
the Loans, L/C Borrowings and other Obligations, ratably among the Lenders and
the L/C Issuers 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 and L/C Borrowings,
ratably among the Lenders and the L/C Issuers in proportion to the respective
amounts described in this clause Fourth held by them;

 

Fifth, to the Administrative Agent for the
account of the L/C Issuers, to Cash Collateralize that portion of L/C
Obligations comprised of the aggregate undrawn amount of Letters of Credit to
the extent not otherwise Cash Collateralized by the Borrower pursuant to Sections
2.03 and 2.15; 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.

 

Subject to Sections
2.03(c) and 2.14, amounts used to Cash Collateralize the
aggregate undrawn amount of Letters of Credit pursuant to clause Fifth
above shall be applied to satisfy drawings under such Letters of Credit as they
occur.  If any amount remains on deposit
as Cash Collateral after all Letters of Credit have either been fully drawn or
expired, such remaining amount shall be applied to the other Obligations, if
any, in the order set forth above.

 

ARTICLE IX.        ADMINISTRATIVE AGENT

 

9.01        Appointment and Authority.  Each of the
Lenders and the L/C Issuers 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, the Lenders and the L/C Issuers, and the Borrower shall not have rights as
a third party beneficiary of any of such provisions, except as provided in Section 9.06.

 

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 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.

 

69

 

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) and (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, a Lender or an
L/C Issuer.

 

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, except as it relates
to enforceability against the Administrative Agent 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 been signed, sent or otherwise authenticated by
the proper Person.  The Administrative
Agent 

 

70

 

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, or the issuance of a Letter of Credit, that
by its terms must be fulfilled to the satisfaction of a Lender or an L/C
Issuer, the Administrative Agent may presume that such condition is
satisfactory to such Lender or such L/C Issuer unless the Administrative Agent
shall have received notice to the contrary from such Lender or such L/C Issuer
prior to the making of such Loan or the issuance of such Letter of Credit.  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.

 

(a)           The Administrative Agent may at any
time give notice of its resignation to the Lenders, the L/C Issuers and the
Borrower.  Upon receipt of any such
notice of resignation, the Required Lenders shall have the right, with the
prior written consent of the Borrower (so long as no Event of Default has
occurred and is continuing), to appoint a successor, which shall be a
commercial bank organized and licensed under the laws of 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 and the L/C Issuers, with the prior written consent of the Borrower (so
long as no Event of Default has occurred and is continuing), 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 or the L/C
Issuers 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 and each L/C
Issuer 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 

 

71

 

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), except for its obligations under Section 10.07.  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 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.

 

(b)          Any
resignation by Bank of America as Administrative Agent pursuant to this Section shall
also constitute its resignation as an L/C Issuer.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, (a) such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring L/C Issuer, (b) the retiring L/C Issuer shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents, and (c) the successor L/C Issuer shall issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or make other arrangements satisfactory to the retiring
L/C Issuer to effectively assume the obligations of the retiring L/C Issuer
with respect to such Letters of Credit.

 

9.07        Non-Reliance on Administrative Agent and Other Lenders. 
Each Lender and each L/C Issuer 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 and each L/C
Issuer 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 Co-Syndication Agents, the
Sole Lead Arranger or Sole Book Manager 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, a Lender or an L/C Issuer 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 the Borrower, the Administrative Agent (irrespective of whether the
principal of any Loan or L/C Obligation 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, L/C Obligations and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable 

 

72

 

in order to have the claims of the Lenders, the L/C
Issuers and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders, the L/C
Issuers and the Administrative Agent and their respective agents and counsel
and all other amounts due the Lenders, the L/C Issuers and the Administrative
Agent under Sections 2.03(h) and (i), 2.08 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 and each
L/C Issuer 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 and the L/C Issuers, 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 2.08 and 10.04.

 

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 or any L/C Issuer any plan of
reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or any L/C Issuer to authorize the
Administrative Agent to vote in respect of the claim of any Lender or any L/C
Issuer in any such proceeding.

 

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 therefrom, shall be effective unless
in writing signed by the Required Lenders and the Borrower, 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)           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;

 

(b)           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;

 

(c)           reduce the principal of, or the rate
of interest specified herein on, any Loan or L/C Borrowing, or (subject to
clause (iii) 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 or Letter of Credit Fees at the
Default Rate or (ii) to amend or waive compliance with any covenant
hereunder (or any defined term used therein) 

 

73

 

even if the effect of such amendment or waiver would
be to reduce the rate of interest on any Loan or L/C Borrowing or to reduce any
fee payable hereunder;

 

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

 

(e)           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;

 

and, provided
further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the applicable L/C Issuer in addition to the Lenders
required above, affect the rights or duties of any L/C Issuer under this
Agreement or any Issuer Document relating to any Letter of Credit issued or to
be issued by it; (ii) 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; (iii) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto; and (iv) the Administrative Agent may, with the
written consent of the Borrower, amend, modify or supplement this Agreement to
cure any obvious error or omission. 
Notwithstanding anything to the contrary herein, no Defaulting Lender
shall have any right to approve or disapprove any amendment, waiver or consent
hereunder (and any amendment, waiver or consent which by its terms requires the
consent of all Lenders or each affected Lender may be effected with the consent
of the applicable Lenders other than Defaulting Lenders), except that (x) the
Commitment of any Defaulting Lender may not be increased or extended without
the consent of such Lender and (y) any waiver, amendment or modification
requiring the consent of all Lenders or each affected Lender that by its terms
affects any Defaulting Lender more adversely than other affected Lenders shall
require the consent of such Defaulting 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, the
Administrative Agent or Bank of America, in its capacity as a Lender or an L/C
Issuer, 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 or L/C Issuer,
to the address, telecopier number, electronic mail address or telephone number
specified in its Administrative Questionnaire (including, as appropriate,
notices delivered solely to the Person designated by a Lender 

 

74

 

or L/C Issuer on its
Administrative Questionnaire then in effect for the delivery of notices that
may contain material non-public information relating to the Borrower).

 

Notices and other
communications sent by hand or overnight courier service, or mailed by
certified or registered mail, shall be deemed to have been given when received;
notices and other communications 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 and other communications 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 and the L/C Issuers 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 or any L/C Issuer
pursuant to Article II if such Lender or such L/C Issuer, as
applicable, has notified the Administrative Agent (which in turn has promptly
notified the Borrower) that it is incapable of receiving notices 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, any L/C
Issuer 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 

 

75

 

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, any L/C Issuer 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, the Administrative
Agent and the L/C Issuers may change its address, electronic mail 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, electronic mail address,
telecopier or telephone number for notices and other communications hereunder
by notice to the Borrower, the Administrative Agent and the L/C Issuers.  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.  Furthermore, each Public Lender
agrees to cause at least one individual at or on behalf of such Public Lender
to at all times have selected the “Private Side Information” or similar
designation on the content declaration screen of the Platform in order to
enable such Public Lender or its delegate, in accordance with such Public
Lender’s compliance procedures and applicable Law, including United States
Federal and state securities Laws, to make reference to Borrower Materials that
are not made available through the “Public Side Information” portion of the
Platform and that may contain material non-public information with respect to
the Borrower or its securities for purposes of United States Federal or state
securities laws.

 

(e)           Reliance by Administrative Agent,
L/C Issuers and Lenders.  The Administrative Agent, the L/C
Issuers and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Loan Notices) purportedly given by a Responsible Officer
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.  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; Enforcement. 
No failure by any Lender, any L/C Issuer, the Borrower 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.

 

Notwithstanding anything
to the contrary contained herein or in any other Loan Document, the authority
to enforce rights and remedies hereunder and under the other Loan Documents
against the Borrower shall be vested exclusively in, and all actions and
proceedings at law in connection with such enforcement shall be instituted and
maintained exclusively by, the Administrative Agent in accordance with Section 8.02
for the benefit of all the Lenders and the 

 

76

 

L/C Issuers; provided,
however, that the foregoing shall not prohibit (a) the
Administrative Agent from exercising on its own behalf the rights and remedies
that inure to its benefit (solely in its capacity as Administrative Agent)
hereunder and under the other Loan Documents, (b) any L/C Issuer from
exercising the rights and remedies that inure to its benefit (solely in its
capacity as an L/C Issuer) hereunder and under the other Loan Documents, (c) any
Lender from exercising setoff rights in accordance with Section 10.08
(subject to the terms of Section 2.12), or (d) any Lender from
filing proofs of claim or appearing and filing pleadings on its own behalf
during the pendency of a proceeding relative to the Borrower under any Debtor
Relief Law; and provided, further, that if at any time there is
no Person acting as Administrative Agent hereunder and under the other Loan
Documents, then (i) the Required Lenders shall have the rights otherwise
ascribed to the Administrative Agent pursuant to Section 8.02 and (ii) in
addition to the matters set forth in clauses (b), (c) and (d) of the
preceding proviso and subject to Section 2.12, any Lender may, with
the consent of the Required Lenders, enforce any rights and remedies available
to it and as authorized by the Required Lenders.

 

10.04      Expenses; Indemnity; Damage Waiver.

 

(a)           Costs and Expenses.  Subject to the provisions of the Fee Letter,
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 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), (ii) all reasonable
out-of-pocket expenses incurred by any L/C Issuer in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder and (iii) all out-of-pocket expenses incurred by
the Administrative Agent, any Lender or any L/C Issuer (including the fees,
charges and disbursements of any counsel for the Administrative Agent, any
Lender or any L/C Issuer), 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 or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.

 

(b)           Indemnification by the Borrower.  The Borrower shall indemnify the
Administrative Agent (and any sub-agent thereof), each Lender and each L/C
Issuer, 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), incurred by any Indemnitee or asserted against any Indemnitee by
any third party or by the Borrower 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 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 (including in respect of any 

 

77

 

matters addressed in Section 3.01), (ii) any
Loan or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the any L/C Issuer to honor a demand for payment
under a Letter of Credit if the documents presented in connection with such
demand do not strictly comply with the terms of such Letter of Credit), (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, 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 against an
Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder
or under any other Loan Document, if the Borrower 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), each L/C Issuer or any Related Party of any of the
foregoing, each Lender severally agrees to pay to the Administrative Agent (or
any such sub-agent), such L/C Issuer 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) or such
L/C Issuer 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) or such
L/C Issuer in connection with such capacity. 
The obligations of the Lenders under this subsection (c) are
subject to the provisions of Section 2.11(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 Letter of Credit 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 to such unintended recipients 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 or willful misconduct of such
Indemnitee as determined by a final and nonappealable judgment of a court of
competent jurisdiction.

 

78

 

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

 

(f)                                    Survival.  The
agreements in this Section shall survive the resignation of the
Administrative Agent and Bank of
America as an L/C Issuer, 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, any L/C Issuer or any Lender, or the
Administrative Agent, any L/C Issuer 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, such L/C Issuer 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 and each L/C Issuer 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 and the L/C Issuers
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 (other than any Defaulting 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, the L/C Issuers and the Lenders)
any legal or equitable right, remedy or claim under or by reason of this
Agreement. The Administrative Agent in its capacity as such may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of the Borrower, except in compliance with Section 9.06.

 

79

 

(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 (including for purposes of this
subsection (b), participations in L/C Obligations) 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 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 outstanding principal 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 and, after giving effect to any assignment of Commitments, the
assignor shall not have a Commitment of less than $10,000,000 and the assignee
shall have a Commitment of 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).

 

(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) 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 (other than any Defaulting Lender), an Affiliate of a
Lender (other than any Defaulting Lender) or an Approved Fund; provided that the
Borrower shall be deemed to have consented to any such assignment unless it
shall object thereto by written notice to the Administrative Agent within five (5) Business
Days after having received notice thereof;

 

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

 

80

 

(C)                                the consent of the L/C Issuers (such
consent not to be unreasonably withheld or delayed) shall be required for any
assignment that increases the obligation of the assignee to participate in
exposure under one or more Letters of Credit (whether or not then outstanding).

 

(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 of $3,500; 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.

 

(v)                                 No Assignment to Certain Persons. 
No such assignment shall be made to (A) the Borrower or any of the
Borrower’s Affiliates or
Subsidiaries, (B) any Defaulting Lender or any of its Subsidiaries, or any
Person who, upon becoming a Lender hereunder, would constitute any of the
foregoing Persons described in this clause (B), or (C) a natural person.

 

(vi)                              Certain Additional Payments. 
In connection with any assignment of rights and obligations of any
Defaulting Lender hereunder, no such assignment shall be effective unless and
until, in addition to the other conditions thereto set forth herein, the
parties to the assignment shall make such additional payments to the
Administrative Agent in an aggregate amount sufficient, upon distribution
thereof as appropriate (which may be outright payment, purchases by the
assignee of participations or subparticipations, or other compensating actions,
including funding, with the prior written consent of the Borrower and the
Administrative Agent, the applicable pro rata share of Loans previously
requested but not funded by the Defaulting Lender, to each of which the
applicable assignee and assignor hereby irrevocably consent), to (x) pay
and satisfy in full all payment liabilities then owed by such Defaulting Lender
to the Administrative Agent or any Lender hereunder (and interest accrued
thereon) and (y) acquire (and fund as appropriate) its full pro rata share
of all Loans and participations in Letters of Credit in accordance with its
Applicable Percentage.  Notwithstanding
the foregoing, in the event that any assignment of rights and obligations of
any Defaulting Lender hereunder shall become effective under applicable Law
without compliance with the provisions of this paragraph, then the assignee of
such interest shall be deemed to be a Defaulting Lender for all purposes of
this Agreement until such compliance occurs.

 

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, 3.05, and 10.04 and be bound by all of the
provisions of this Agreement with respect to facts and circumstances 

 

81

 

occurring prior to the effective date of such
assignment and shall continue to remain obligated under Sections 10.03, 10.07,
10.10, 10.12, 10.14, and 10.15 on and after the
effective 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 (and such agency being solely for tax purposes), 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 and interest amounts of
the Loans and L/C Obligations 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. In addition, the
Administrative Agent shall maintain on the Register information regarding the
designation, and revocation of designation, of any Lender as a Defaulting
Lender.  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, a Defaulting Lender 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 (including such
Lender’s participations in L/C Obligations) 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, the Lenders and the L/C Issuers shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Each
Lender, acting solely for this purpose as an agent of the Borrower (and such
agency being solely for tax purposes), shall maintain at such Lender’s Lending
Office a register for the recordation of the names and addresses of each of its
Participants, and the amount of the participation sold to such Participant by
such Lender and the related interest amounts owing to such Participant.

 

Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in subsections
(a), (b) or (c) of 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, 3.04
and 3.05  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, 

 

82

 

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 2.12
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, unless the sale of the participation to
such Participant is made with the Borrower’s prior written consent.  A Participant 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)                                 Resignation as an L/C Issuer after
Assignment.  Notwithstanding anything to the contrary
contained herein, if at any time Bank of America assigns all of its Commitment
and Loans pursuant to subsection (b) above (including an assignment
initiated pursuant to Section 10.13), Bank of America may, upon 30
days’ notice to the Borrower and the Lenders, resign as an L/C Issuer.  In the event of any such resignation as L/C
Issuer, the Borrower shall be entitled to appoint from among the Lenders a
successor L/C Issuer hereunder; provided, however, that no
failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as L/C Issuer. 
If Bank of America resigns as an L/C Issuer, it shall retain all the
rights, powers, privileges and duties of an L/C Issuer hereunder with respect
to all Letters of Credit outstanding as of the effective date of its
resignation as L/C Issuer and all L/C Obligations with respect thereto
(including the right to require the Lenders to make Base Rate Loans or fund
risk participations in Unreimbursed Amounts pursuant to Section 2.03(c)).  Upon the appointment of a successor L/C
Issuer, such successor (a) shall succeed to and become vested with all of
the rights, powers, privileges and duties of the retiring L/C Issuer and (b) shall
issue letters of credit in substitution for the Letters of Credit, if any,
outstanding at the time of such succession or make other arrangements
satisfactory to Bank of America to effectively assume the obligations of Bank
of America with respect to such Letters of Credit.

 

10.07                 Treatment of Certain Information;
Confidentiality.  Each of the Administrative Agent, the Lenders
and the L/C Issuers agrees to maintain the confidentiality of the Information
(as defined below), and use the Information only in connection with the
transactions contemplated hereby, except that Information may be disclosed (a) to
its Affiliates and to its and its Affiliates’ respective partners, directors,
officers, employees, agents, trustees, advisors and representatives (provided
that the Person to whom such disclosure is made needs to know such Information
in connection with the transactions contemplated hereby and 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 and shall have agreed to be bound by the confidentiality and use
provisions of this Section to the same extent as if they were parties
hereto  and that the disclosing Person shall
be responsible for 

 

83

 

any breach of this
provision), (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 on a confidential
basis, (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, but no less restrictive, as those of this Section and
to which the Borrower is a beneficiary thereof, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 2.13(c) 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 prior written 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 other known confidentiality agreement or
obligation; provided that with respect to subsections (b), (c), (e) and
(f), the Administrative Agent, such Lender or such L/C Issuer, as the case may
be, provides notification to the Borrower within a reasonable time prior to any
disclosure or, if such prior notification is not reasonably practicable, then
as soon as reasonably practicable, in either case to the extent such notification
is not prohibited by the regulatory authority to which such disclosure is made,
the legal process in which such disclosure is made and applicable law, as
applicable or (y) becomes available to the Administrative Agent, any
Lender or any L/C Issuer on a nonconfidential basis from a source other than
the Borrower that was not known to be bound by a confidentiality agreement or
obligation.  For purposes of this
Section, “Information” means all information received from or on behalf of the
Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of
their respective businesses or Affiliates, other than any such information that
is available to the Administrative Agent, any Lender or any L/C Issuer on a
nonconfidential basis prior to disclosure by the Borrower or any
Subsidiary.  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, the Lenders and the L/C Issuers
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 reasonable and customary 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 United
States Federal and state securities Laws. 
The obligations contained in this Section 10.07 shall
survive the expiration or termination of this Agreement.

 

10.08                 Right of Setoff. 
If an Event of Default shall have occurred and be continuing, each
Lender, each L/C Issuer and each of their 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, such L/C Issuer 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 

 

84

 

this Agreement or any
other Loan Document to such Lender or such L/C Issuer, irrespective of whether
or not such Lender or such L/C Issuer shall have made any demand under this
Agreement or any other Loan Document and although such obligations of the
Borrower are owed to a branch or
office of such Lender or such L/C Issuer different from the branch or office
holding such deposit or obligated on such indebtedness; provided, that in the
event that any Defaulting Lender shall exercise any right of setoff, (x) all
amounts so set off shall be paid over immediately to the Administrative Agent
for further application in accordance with the provisions of Section 2.15
and, pending such payment, shall be segregated by such Defaulting Lender from
its other funds and deemed held in trust for the benefit of the Administrative
Agent and the Lenders, and (y) the Defaulting Lender shall provide
promptly to the Administrative Agent a statement describing in reasonable
detail the Obligations owing to such Defaulting Lender as to which it exercised
such right of setoff.  The rights of each Lender, each L/C Issuer
and their respective Affiliates under this Section are in addition to
other rights and remedies (including other rights of setoff) that such Lender,
such L/C Issuer or their respective Affiliates may have.  Each Lender and each L/C Issuer 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 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 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 shall become effective when it 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 by telecopy or
other electronic imaging means shall be effective as delivery of a manually
executed counterpart of this Agreement.

 

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 

 

85

 

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
or any Letter of Credit shall remain outstanding.

 

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. 
Without limiting the foregoing provisions of this Section 10.12,
if and to the extent that the enforceability of any provisions in this
Agreement relating to Defaulting Lenders shall be limited by Debtor Relief
Laws, as determined in good faith by the Administrative Agent or the L/C
Issuers, as applicable, then such provisions shall be deemed to be in effect
only to the extent not so limited.

 

10.13                 Replacement of Lenders.  (a) If any Lender requests
compensation under Section 3.04, (b) 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 or
3.04, (c) if any Lender gives a notice under Section 3.02,
(d) if any Lender is a Defaulting Lender, (e) if any Lender is a
Restricted Lender (as defined below) or (f) if the long term local issuer
credit rating, or the equivalent rating, by S&P of any Lender is dropped below A-, then, in the case of clauses (a) through (e), the
Borrower, and in the case of clause (f), the Administrative Agent, may, at the
sole expense and effort of the Borrower or, in the case of clause (f), the sole
expense of the Borrower and the joint effort of the Borrower and the
Administrative Agent, upon notice to such Lender and the Administrative Agent
or the Borrower, as applicable, 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 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 100% of the outstanding principal of its Loans and L/C
Advances, accrued interest thereon, accrued fees and all other amounts payable
to it hereunder and under the other Loan Documents (including any amounts under
Section 3.05) 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);

 

86

 

(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, a reasonable time prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower or the
Administrative Agent 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 Borrower 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 NEW YORK.

 

(b)                                 SUBMISSION TO JURISDICTION. 
EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF
AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT
OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF,
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS 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 NEW YORK 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 BORROWER, THE
ADMINISTRATIVE AGENT, ANY LENDER OR ANY L/C ISSUER 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.

 

87

 

(c)                                  WAIVER OF VENUE. 
EACH PARTY 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 (including in connection
with any amendment, waiver or other modification hereof or of any other Loan
Document), the Borrower acknowledges and agrees that: (i) (A) the
arranging and other services regarding this Agreement provided by the
Administrative Agent and the
Arranger, are arm’s-length commercial transactions between the Borrower, on the
one hand, and the Administrative Agent and
the Arranger, on the other hand, (B) the Borrower has consulted its own
legal, accounting, regulatory and tax advisors to the extent it has deemed
appropriate, and (C) the Borrower is capable of evaluating, and
understands and accepts, the terms, risks and conditions of the transactions
contemplated hereby and by the other Loan Documents; (ii) (A) the
Administrative Agent and the
Arranger each is and has been acting solely as a principal and, except as
expressly agreed in writing by the relevant parties, has not been, is not, and
will not be acting as an advisor, agent or fiduciary for the Borrower or any of
its Affiliates, or any other
Person and (B) neither the Administrative Agent nor the 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; and (iii) the Administrative Agent
and the Arranger and their
respective Affiliates 

 

88

 

may be engaged in a broad
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 to the Borrower
or its Affiliates.  To the fullest extent
permitted by law, the Borrower
hereby waives and releases 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 in connection with any aspect of any transaction contemplated hereby.

 

10.17                 Electronic Execution of
Assignments and Certain Other Documents.  The words “execution,” “signed,” “signature,”
and words of like import in any Assignment and Assumption or in any amendment
or other modification hereof (including waivers and consents) 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.

 

10.18                 USA PATRIOT Act.  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.  The
Borrower shall, promptly following a request by the Administrative Agent or any
Lender, provide all documentation and other information that the Administrative
Agent or such Lender requests in order to comply with its ongoing obligations
under applicable “know your customer” and anti-money laundering rules and
regulations, including the Act.

 

[Signature pages follow.]

 

89

 

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

 

	
   

  	
  THE DAYTON POWER AND LIGHT COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Frederick J. Boyle

  
	
   

  	
  Title:

  	
  Senior Vice President, Chief Financial Officer and
  Treasurer

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

	
   

  	
  BANK OF AMERICA, N.A., as

  
	
   

  	
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Bozena Janociak

  
	
   

  	
  Title:

  	
  Assistant Vice President

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

	
   

  	
  BANK OF AMERICA, N.A., as a Lender and an L/C Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

	
   

  	
  PNC BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

	
   

  	
  U.S. BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

	
   

  	
  FIFTH THIRD BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

	
   

  	
  JPMORGAN CHASE BANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

The Dayton Power and Light Company

Credit Agreement

Signature Page

 

 

SCHEDULE 2.01

 

COMMITMENTS

AND APPLICABLE PERCENTAGES

 

	
  Lender

  	
   

  	
  Commitment

  	
   

  	
  Applicable

  Percentage

  	
   

  
	
  Bank
  of America, N.A.

  	
   

  	
  $

  	
  70,000,000.00

  	
   

  	
  35.000000000

  	
  %

  
	
  PNC
  Bank, National Association

  	
   

  	
  $

  	
  45,000,000.00

  	
   

  	
  22.500000000

  	
  %

  
	
  U.S.
  Bank National Association

  	
   

  	
  $

  	
  45,000,000.00

  	
   

  	
  22.500000000

  	
  %

  
	
  Fifth
  Third Bank

  	
   

  	
  $

  	
  20,000,000.00

  	
   

  	
  10.000000000

  	
  %

  
	
  JPMorgan
  Chase Bank, N.A.

  	
   

  	
  $

  	
  20,000,000.00

  	
   

  	
  10.000000000

  	
  %

  
	
  Total

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  	
  100.000000000

  	
  %

  

 

S-1

 

SCHEDULE
7.01

 

EXISTING
LIENS

 

None.

 

S-2

 

SCHEDULE
7.02

 

EXISTING
INVESTMENTS

 

The
Borrower owns a 4.9% equity ownership interest in Ohio Valley Electric
Corporation (OVEC), an electric generation company, and guarantees 4.9% of OVEC’s
debt obligations.  Without limiting the foregoing and for informational
purposes, as of December 31, 2009, the
Borrower could be responsible for the repayment of 4.9%, or $54.4
million, of a $1,110 million debt obligation that matures in 2026.

 

S-3

 

SCHEDULE 10.02

 

ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES

 

BORROWER:

 

The Dayton Power and
Light Company

1065 Woodman Drive

Dayton, OH 45432

	
  Attention:

  	
  Frederick J. Boyle, Senior
  Vice President, Chief Financial Officer and Treasurer

  
	
  Telephone:

  	
  937-259-7195

  
	
  Telecopier:

  	
  937-259-7386

  

Electronic Mail: fred.boyle@dplinc.com

Website Addresses:                         www.dpandl.com; www.dplinc.com

U.S.
Taxpayer Identification Number: 31-0258470

 

With a mandatory copy to:

 

The Dayton Power and
Light Company

1065 Woodman Drive

Dayton, OH 45432

	
  Attention:

  	
  Charles J.
  Hofmann, Jr., Director of Treasury

  
	
  Telephone:

  	
  937-259-7142

  
	
  Telecopier:

  	
  937-259-7147

  

Electronic
Mail: chuck.hofmann@dplinc.com

 

ADMINISTRATIVE
AGENT:

 

Administrative Agent’s Office  

(for payments and Requests for
Credit Extensions):

Bank of America, N.A.

901 Main St.

Mail Code: TX-492-14-14

Dallas, TX 75202-3714

	
  Attention:

  	
  Keli Torres

  
	
  Telephone:

  	
  214-209-1864

  
	
  Telecopier:

  	
  214-290-8375

  

Electronic Mail: keli.torres@baml.com

Account No.:  1292-000-883

Ref:   Dayton Power and Light

ABA# 026-009-593

 

S-4

 

Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management

231 S. LaSalle St.

Mail Code: IL1-231-10-41

Chicago, IL 60604

	
  Attention:

  	
  Bozena Janociak

  
	
  Telephone:

  	
  312-828-3597

  
	
  Telecopier:

  	
  877-207-0732

  

Electronic Mail: 
bozena.janociak@baml.com

 

L/C ISSUER:

 

Bank of America, N.A.

Trade
Operations

1 Fleet Way

Mail Code: PA6-580-02-30

Scranton, PA 18507

	
  Attention:

  	
  Alfonso
  (Al) Malave

  
	
  Telephone:

  	
  570-330-4212

  
	
  Telecopier:

  	
  570-330-4186

  

Electronic
Mail:  alfonzo.malave@baml.com

 

S-5

 

EXHIBIT A

 

FORM OF LOAN NOTICE

 

Date: 
                      ,
20  

 

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

 

Ladies and
Gentlemen:

 

Reference
is made to that certain Credit Agreement, dated as of April 20, 2010 (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 Dayton Power and Light Company, an Ohio
corporation (the “Borrower”), the Lenders from time to time party
thereto, Bank of America, N.A., as Administrative Agent and an L/C Issuer, and
PNC Capital Markets, LLC and U.S. Bank National Association, as Co-Syndication
Agents.

 

	
  The
  undersigned, on behalf of the Borrower, hereby requests (select one):

  
	
   

  	
   

  
	
  o A Borrowing of Loans

  	
  o A conversion or continuation 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 clause (i) of the
proviso to the first sentence of Section 2.01 of the Agreement.

 

	
   

  	
  THE DAYTON POWER AND LIGHT COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

A-1

 

EXHIBIT
B

 

FORM OF NOTE

 

April 20,
2010

 

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 April 20, 2010 (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, Bank of America, N.A.,
as Administrative Agent and an L/C Issuer, and PNC Capital Markets, LLC and
U.S. Bank National Association, as Co-Syndication Agents.

 

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.

 

Except
as permitted by Section 10.06 of the Credit Agreement, this Note
may not be assigned by the Lender to any Person.

 

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.  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.

 

B-1

 

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

 

	
   

  	
  THE DAYTON POWER AND LIGHT COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

B-2

 

LOANS AND PAYMENTS WITH RESPECT
THERETO

 

	
  Date

  	
   

  	
  Type of

  Loan Made

  	
   

  	
  Amount of

  Loan Made

  	
   

  	
  End  of

  Interest

  Period

  	
   

  	
  Amount  of

  Principal  or

  Interest

  Paid This

  Date

  	
   

  	
  Outstanding

  Principal

  Balance

  This Date

  	
   

  	
  Notation

  Made By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B-3

 

EXHIBIT
C

 

FORM OF COMPLIANCE
CERTIFICATE

 

Financial Statement
Date:              ,
20  

 

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

 

Ladies and
Gentlemen:

 

Reference
is made to that certain Credit Agreement, dated as of April 20, 2010 (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 Dayton Power and Light Company, an Ohio
corporation (the “Borrower”), the Lenders from time to time party
thereto, Bank of America, N.A., as Administrative Agent and an L/C Issuer, and
PNC Capital Markets, LLC and U.S. Bank National Association, as Co-Syndication
Agents.

 

The undersigned Responsible Officer, solely in his/her
capacity as a Responsible Officer of the Borrower and not in his/her individual
capacity and without personal liability to the Administrative Agent or the
Lenders with respect hereto, on behalf of the Borrower, 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]

 

1.                                       The Borrower has delivered 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]

 

1.                                       The Borrower has delivered 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 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 reasonably detailed review of the transactions and
condition (financial or otherwise) of the Borrower during the accounting period
covered by such financial statements, and

 

[select one:]

 

C-1

 

[to the knowledge of the undersigned, as of the
date hereof no Default has occurred and is continuing.]

 

—or—

 

[to the
knowledge of the undersigned, the following is a list of each such Default and
its nature and status:]

 

3.                                       The representations and warranties of the
Borrower contained in Article V of the Agreement are true and
correct in all material respects on and as of the date hereof, except that (i) if
a qualifier relating to materiality, Material Adverse Effect or a similar
concept applies, such representation or warranty is true and correct in all respects,
(ii) to the extent that such representations and warranties specifically
refer to an earlier date, in which case they are true and correct in all
material respects as of such earlier date (except that if a qualifier relating
to materiality, Material Adverse Effect or a similar concept applies, such
representation or warranty is true and correct in all respects) and (iii) for
purposes of this Compliance Certificate, the representations and warranties
contained in subsections (a) and (b) of Section 5.05 of
the Credit 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 Credit Agreement, including the statements in connection with which this
Compliance Certificate is delivered.

 

4.                                       The financial covenant analyses and
information set forth on Schedule 1 attached hereto are true and
accurate in all material respects on and as of the date of this Compliance
Certificate.

 

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

 

 

	
   

  	
  THE DAYTON POWER AND LIGHT COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

C-2

 

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

 

SCHEDULE 1

to the Compliance
Certificate

($ in 000’s)

 

Section 7.11 — Consolidated
Total Debt to Consolidated Total Capitalization.

 

	
  I.

  	
   

  	
  Consolidated
  Total Debt at Statement Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  II.

  	
   

  	
  Consolidated
  Total Capitalization at Statement Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A.

  	
  Consolidated
  Total Debt (Line I above):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B.

  	
  +
  Consolidated Net Worth:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C.

  	
  +
  Preferred stock of the Borrower:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  D.

  	
  =
  Consolidated Total Capitalization:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  III.

  	
   

  	
  Ratio
  (Line I  ̧ Line II.D):

  	
   

  	
  to 1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Maximum
  permitted:

  	
   

  	
  0.65 to 1.00

  	
   

  

 

C-3

 

EXHIBIT
D-1

 

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](1) Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each](2) 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](3) hereunder
are several and not joint.](4)  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 (including, without limitation, the Letters of Credit included
in such facilities) 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 pursuant to clause (i) above
(the rights and obligations sold and assigned by [the][any] Assignor
to [the][any] Assignee pursuant to clauses
(i) and (ii) above being referred to herein collectively as 

 

(1) For bracketed
language here and elsewhere in this form relating to the Assignor(s), if the
assignment is from a single Assignor, choose the first bracketed language.  If the assignment is from multiple Assignors,
choose the second bracketed language.

 

(2) For bracketed
language here and elsewhere in this form relating to the Assignee(s), if the assignment
is to a single Assignee, choose the first bracketed language.  If the assignment is to multiple Assignees,
choose the second bracketed language.

 

(3) Select as
appropriate.

 

(4) Include
bracketed language if there are either multiple Assignors or multiple
Assignees.

 

D-1-1

 

[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:                                            The
Dayton Power and Light Company

 

4.                                       Administrative
Agent: Bank of America, N.A., as the administrative agent under the Credit
Agreement

 

5.                                       Credit
Agreement:                                               Credit
Agreement, dated as of April 20, 2010, among The Dayton Power and Light
Company, the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent and an L/C
Issuer

 

6.                                       Assigned
Interest[s]:

 

	
  Assignor[s](5)

  	
   

  	
  Assignee[s](6)

  	
   

  	
  Aggregate

  Amount of

  Commitment

  for all Lenders(7)

  	
   

  	
  Amount
  of

  Commitment

  Assigned

  	
   

  	
  Percentage

  Assigned of

  Commitment(8)

  	
   

  	
  CUSIP

  Number

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  

 

[7.                                  Trade
Date:                    ](9)

 

(5) List each
Assignor, as appropriate.

 

(6) List each
Assignee, as appropriate.

 

(7) 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.

 

(8) Set forth, to at
least 9 decimals, as a percentage of the Commitment of all Lenders thereunder.

 

D-1-2

 

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:

  
	
   

  	
   

  
	
   

  	
  ASSIGNEE

  
	
   

  	
  [NAME OF ASSIGNEE]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  

 

[Consented to and](10) Accepted:

 

	
  BANK OF AMERICA, N.A., as

  
	
    Administrative
  Agent

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

[Consented to:](11)

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

(9) To be completed
if the Assignor and the Assignee intend that the minimum assignment amount is
to be determined as of the Trade Date.

 

(10) To be added
only if the consent of the Administrative Agent is required by the terms of the
Credit Agreement.

 

(11) To be added only if
the consent of the Borrower and/or other parties (e.g. an L/C Issuer) is
required by the terms of the Credit Agreement.

 

D-1-3

 

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

 

STANDARD TERMS AND CONDITIONS FOR

 

ASSIGNMENT AND ASSUMPTION

 

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) and (v) of
the Credit Agreement (subject to such consents, if any, as may be required
under Section 10.06(b)(iii) of 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 represented 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 taking action under the Loan Documents, and (ii) it will 

 

D-1-4

 

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][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 New York.

 

D-1-5

 

EXHIBIT
D-2

 

FORM OF
ADMINISTRATIVE QUESTIONNAIRE

 

See attached.

 

D-2-1

 

ADMINISTRATIVE
DETAILS REPLY FORM — US DOLLAR ONLY

 

CONFIDENTIAL

 

(i)                      FAX ALONG WITH COMMITMENT LETTER
TO:

 

FAX #                                                                                                                       

 

	
  I.

  	
  Borrower
  Name:

  	
  The
  Dayton Power and Light Company

  

 

	
  $

  	
  Type of Credit Facility

  

 

II. Legal
Name of Lender of Record for Signature Page:

 

 

	
  ·

  	
  Signing
  Credit Agreement

  	
  o YES

  	
  o NO

  
	
  ·

  	
  Coming in via Assignment

  	
  o YES

  	
  o NO

  

 

III. Type of Lender:                                                                                                                                                                              
(Bank, Asset Manager, Broker/Dealer, CLO/CDO, Finance Company, Hedge Fund,
Insurance, Mutual Fund, Pension Fund, Other Regulated Investment Fund, Special
Purpose Vehicle, Other — please specify)

 

	
  IV. Domestic Address:

  	
   

  	
  V.
  Eurodollar Address:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

(ii)

(iii)                             VI.  Contact Information:

Syndicate level information (which may
contain material non-public information about the Borrower and its related
parties or their respective securities will be made available to the Credit
Contact(s).  The Credit Contacts identified must be able to receive such
information in accordance with his/her institution’s compliance procedures and
applicable laws, including Federal and State securities laws.

 

	
   

  	
   

  	
  Primary

  	
   

  	
  Secondary

  
	
  Credit Contact

  	
   

  	
  Operations Contact

  	
   

  	
  Operations Contact

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Telephone:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Facsimile:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E Mail Address:

  	
   

  	
   

  	
   

  	
   

  

 

Does Secondary
Operations Contact need copy of notices?  
o YES   o NO

 

D-2-2

 

	
  Letter of Credit

  	
   

  	
  Draft Documentation

  	
   

  	
   

  
	
  Contact

  	
   

  	
  Contact

  	
   

  	
  Legal Counsel

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Telephone:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Facsimile:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E Mail Address:

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

VII.
Lender’s Standby Letter of Credit, Commercial Letter of Credit, and Bankers’
Acceptance Fed Wire Payment Instructions (if applicable):

 

Pay to:

 

	
   

  	
   

  
	
  (Bank
  Name)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (ABA
  #)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Account
  #)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Attention)

  	
   

  

 

VIII.
Lender’s Fed Wire Payment Instructions:

 

Pay to:

 

	
   

  	
   

  
	
  (Bank
  Name)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (ABA#)

  	
                  (City/State)

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Account
  #)

  	
   

  
	
   

  	
  (Account Name)

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Attention)

  	
   

  

 

D-2-3

 

IX.
Organizational Structure and Tax Status

 

Please
refer to the enclosed withholding tax instructions below and then complete this
section accordingly:

 

Lender Taxpayer
Identification Number (TIN):                        -                                       

 

Tax Withholding Form Delivered
to Bank of America*:

 

	
                     W-9

  
	
   

  
	
                     W-8BEN

  
	
   

  
	
                     W-8ECI

  
	
   

  
	
                     W-8EXP

  
	
   

  
	
                     W-8IMY

  

 

NON—U.S. LENDER
INSTITUTIONS

 

1. Corporations:

 

If your
institution is incorporated outside of the United States for U.S. federal
income tax purposes, and is the beneficial owner of the interest and other
income it receives, you must complete one of the following three tax forms, as
applicable to your institution: a.) Form W-8BEN (Certificate of Foreign
Status of Beneficial Owner), b.) Form W-8ECI (Income Effectively Connected
to a U.S. Trade or Business), or c.) Form W-8EXP (Certificate of Foreign
Government or Governmental Agency).

 

A U.S. taxpayer
identification number is required for any institution submitting a Form W-8
ECI.  It is also required on Form W-8BEN
for certain institutions claiming the benefits of a tax treaty with the
U.S.  Please refer to the instructions
when completing the form applicable to your institution.  In addition, please be advised that U.S. tax
regulations do not permit the acceptance of faxed forms.  An original tax form must
be submitted.

 

2. Flow-Through
Entities

 

If your
institution is organized outside the U.S., and is classified for U.S. federal
income tax purposes as either a Partnership, Trust, Qualified or Non-Qualified
Intermediary, or other non-U.S. flow-through entity, an original Form W-8IMY
(Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain
U.S. branches for United States Tax Withholding) must be completed by the
intermediary together with a withholding statement.  Flow-through entities other than Qualified
Intermediaries are required to include tax forms for each of the underlying beneficial
owners.

 

Please refer to
the instructions when completing this form. 
In addition, please be advised that U.S. tax regulations do not permit
the acceptance of faxed forms.  Original tax form(s) must be submitted.

 

D-2-4

 

U.S. LENDER
INSTITUTIONS:

 

If your
institution is incorporated or organized within the United States, you must
complete and return Form W-9 (Request for Taxpayer Identification Number
and Certification).  Please be
advised that we require an original form W-9.

 

Pursuant
to the language contained in the tax section of the Credit Agreement, the
applicable tax form for your institution must be completed and returned on or
prior to the date on which your institution becomes a lender under this Credit
Agreement.  Failure to provide the proper
tax form when requested will subject your institution to U.S. tax withholding.

 

*Additional
guidance and instructions as to where to submit this documentation can be found
at this link:

 

 

X. Bank
of America Payment Instructions:

 

	
  Pay to:

  	
  Bank of America, N.A.

  
	
   

  	
  ABA # 026009593

  
	
   

  	
  New York, NY

  
	
   

  	
  Acct. # 

  
	
   

  	
  Attn: Corporate Credit
  Services

  
	
   

  	
  Ref: The Dayton Power and Light Company

  

 

D-2-5

 

EXHIBIT
E

 

OPINIONS OF COUNSEL

 

See
attached.

 

E-1

 

April 20, 2010

 

Bank of America, N.A.,

as Administrative Agent
under the

Credit Agreement referred
to below

 

-and-

 

Each of the Lenders a
party to

the Credit Agreement
referred

to below

 

Ladies and Gentlemen:

 

I am the Senior Vice
President, General Counsel and Corporate Development of The Dayton Power and
Light Company, an Ohio corporation (the “Company”).  In such capacity, I have reviewed the Credit
Agreement dated as of April 20, 2010 (the “Credit Agreement”) among the
Company, the lending institutions party thereto (the “Lenders”), Bank of
America, N.A., as Administrative Agent and an L/C Issuer, and PNC Capital
Markets, LLC and U.S. Bank, National Association, as Co-Syndication Agents.

 

I am rendering this
opinion to you, at the request of the Company, pursuant to Section 4.01(a)(v) of
the Credit Agreement.  Unless otherwise
defined herein, terms defined in the Credit Agreement are used herein as therein
defined.

 

In connection with this
opinion, I have examined the following:

 

(i)            the Credit Agreement;

 

(ii)           the Notes (and, together with the
Credit Agreement, the “Loan Documents”) payable to the order of certain of the
Lenders executed and delivered by the Company; and

 

(iii)          such corporate records of the Company,
such certificates of officers of the Company and of governmental authorities,
and such matters of law as I have considered necessary under the circumstances.

 

1

 

In rendering this
opinion, I have assumed the genuineness of all signatures (other than the
signatures of the officers of the Company executing the Loan Documents on
behalf of the Company), the authenticity of all documents submitted to me as
originals and the conformity to the original of all documents submitted to me
as copies or specimens and the authenticity of the originals of such documents
submitted to me as copies or specimens. 
Moreover, I have assumed the following:

 

A.            each certificate issued by any
governmental authority is accurate, correct, complete and authentic;

 

B.            all natural persons are legally
competent and have sufficient legal capacity;

 

C.            each of the parties to the Loan
Documents (other than the Company) has the requisite power and authority to
execute, deliver and perform each of the Loan Documents to which it is a party,
each of the Loan Documents has been duly authorized, executed and delivered by
each of the parties thereto (other than the Company) and the Loan Documents are
legal, valid and binding obligations of the parties thereto, enforceable
against such parties in accordance with their respective terms;

 

D.            any required consent, approval or
authorization of, notice or declaration to, license or exemption from, filing
or registration with, or other action taken by any governmental authority which
any party to the Loan Documents (other than the Company) is required to obtain,
give or make has been duly obtained, given or made, as appropriate, and any
applicable notice or appeal period has passed;

 

E.             except as set forth in the Loan
Documents and the other written agreements, documents and instruments executed
and delivered in connection therewith, there is no agreement or understanding
(written or oral) between or among any of the parties to the Loan Documents,
and there is no usage of trade or course of prior dealing between or among such
parties, which would, in either case, define, supplement, modify or qualify the
terms of any of the Loan Documents;

 

F.             the conduct of the parties to the
Loan Documents has complied with any requirement of good faith, fair dealing
and conscionability; such parties will perform their obligations thereunder
reasonably, in good faith and with fair dealing; and such parties will act
reasonably, in good faith and with fair dealing in taking action, exercising
discretion or making determinations thereunder; and

 

2

 

G.            there has not been any mutual
mistake of fact, fraud, duress or undue influence in connection with the
execution and delivery of the Loan Documents.

 

In addition, I have
assumed the accuracy and correctness of: (i) all statements of fact
contained in certificates of officers of the Company; (ii) all statements
of fact contained in certificates of governmental authorities; and (iii) all
statements of fact and factual representations and warranties contained in the
Loan Documents.  I have not reviewed the
dockets or records of any court or other governmental authority.  Nothing contrary to the facts contained in
such certificates, statements or representations and warranties, however, has
come to my attention.  Whenever this
opinion with respect to the existence or absence of facts is stated to be based
upon my knowledge or awareness, it is intended to signify that no information
has come to my attention that would give me actual knowledge of the existence
or absence of such facts.  However, I
have not undertaken any independent investigation to determine the existence or
absence of such facts, and no inference as to my knowledge of the existence or
absence of such facts should be drawn from my participation in the transactions
contemplated by the Loan Documents.

 

My opinion is limited
solely to matters governed by the laws of the State of Ohio and the federal
laws of the United States.

 

Based upon, and subject
to, the foregoing, it is my opinion that:

 

(a)           The Company is duly organized,
validly existing and in good standing under the Laws of Ohio and has all
requisite power and authority to execute, deliver and perform its obligations
under the Loan Documents and to carry on its business in which it is now
engaged.

 

(b)           The execution, delivery and
performance by the Company of the Loan Documents has been duly authorized by
all necessary corporate action on its part and does not: (i) contravene
the Articles of Incorporation or Regulations of the Company; (ii) conflict
with or result in the contravention of, or the creation of any Lien under, or
require any payment to be made under any Contractual Obligation to which the
Company is a party or the Company or any of its properties is bound or under
any order, injunction, writ or decree of any Governmental Authority or any
arbitral award to which the Company or its property is subject; or (iii) violate
any Law, except in any case referred to in clause (ii) or (iii) of
this paragraph (b), to the extent the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

(c)           Each of the Loan Documents has been
duly executed and delivered by the Company.

 

(d)           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, the Company of any Loan Document, except for such approvals, consents,
exemptions, authorizations, actions,

 

3

 

notices and filings (i) that
have been obtained or made on or before the Closing Date and are in full force
and effect and (ii) from The Public Utilities Commission of Ohio which are
necessary or required in order to permit the Company to incur Obligations under
the Loan Documents after December 31, 2010.

 

(e)                                  I am not aware of any actions, suits,
proceedings, claims or disputes, pending or threatened, at law, in equity, in
arbitration or before any Governmental Authority, by or against the Company
that (i) question the validity or the enforceability of the Loan
Documents, or any of any action to be taken by the Company pursuant to any of
the Loan Documents, or (ii) either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.  For purposes of the opinion set forth in this
paragraph, I have not regarded any actions, suits, proceedings, claims or
disputes to be “threatened” unless the potential litigant, governmental
authority or other party has communicated in writing to the Company a present
intention to initiate such any such action, suit, proceeding, claim or dispute
against the Company.

 

(f)                                    None of the Company or the Parent is or
is required to be registered as an “investment company” under the Investment
Company Act of 1940, as amended.

 

(g)                                 The borrowings
by the Company under the Credit Agreement and the application of the proceeds
thereof as provided in the Credit Agreement will not violate Regulation T, U or
X of the Board of Governors of the Federal Reserve System.

 

(h)                                 The Company is
regulated as a public utility by the Federal Energy Regulatory Commission and
by the Public Utilities Commission of Ohio.

 

This opinion is subject
to the following qualifications and limitations:

 

(1)                                  No opinion is expressed with respect to
the title (or the quality or character thereof) to any property or the
existence or absence of any lien or encumbrance thereon.

 

(2)                                  No opinion is expressed with respect to:

 

(i)            compliance
with any registration, filing, notification, anti-fraud or other provision of
any federal or state securities law, rule or regulation;

 

(ii)           matters
relating to employee benefit laws and regulations (including the Employee
Retirement Income Security Act of 1974, as amended) or federal, state or local
tax laws and regulations; or

 

(iii)          federal
or state antitrust, unfair competition or similar laws and regulations.

 

4

 

No opinion may
be inferred or implied beyond the matters expressly stated herein.  The opinions that are expressed herein are
solely for your benefit in connection with the transactions contemplated by the
Loan Documents and may not be relied upon in any manner for any other purpose
or by any other person (other than your permitted assigns or participants under
the Loan Documents) (each such person, a “Reliance Party”).  Without our prior written consent, this
letter is not to be relied upon, used, circulated, quoted or otherwise referred
to by, or assigned to, any person other than a Reliance Party (including any
person that seeks to assert your rights in respect of this letter (other than
your successor in interest by means of merger, consolidation, transfer of a
business or other similar transaction)) or for any other purpose, except that (a) a
copy of this letter may be delivered by the Administrative Agent to those
Persons who are assignees, participants, potential assignees or potential
participants of any Lender and (b) a copy of this letter may be delivered
to your or any Lender’s regulators, accountants, attorneys and other
professional advisors.  This opinion is
as of its date, and I disclaim any undertaking or obligation to advise you of
changes that hereafter may be brought to my attention or otherwise.

 

	
   

  	
  Very truly yours,

  

 

5

 

April 20, 2010

 

Addressees Listed on
Schedule A

 

Re:          Credit
Agreement

 

Ladies and
Gentlemen:

 

We
have acted as special counsel to The Dayton Power and Light Company (the “Company”)
in connection with the Credit Agreement dated as of April 20, 2010 among
the Company, the Lenders party thereto, Bank of America, N.A., as
Administrative Agent and L/C Issuer and PNC Capital Markets, LLC and U.S. Bank,
National Association, as Co-Syndication Agents (the “Credit Agreement”
and, together with the Notes, the “Loan Documents”).  Capitalized terms used herein but not defined
herein have the respective meanings given them in the Credit Agreement.  We are rendering this opinion letter to you
at the request of the Company pursuant to Section 4.01(a)(v) of the
Credit Agreement.

 

In
rendering the opinions set forth below, we have examined and relied upon the
originals, copies or specimens, certified or otherwise identified to our
satisfaction, of the Loan Documents and such certificates, corporate and public
records, agreements and instruments and other documents, including, among other
things, the documents delivered on the date hereof, as we have deemed
appropriate as a basis for the opinions expressed below.  In such examination we have assumed the genuineness
of all signatures, the authenticity of all documents, agreements and
instruments submitted to us as originals, the conformity to original documents,
agreements and instruments of all documents, agreements and instruments
submitted to us as copies or specimens, the authenticity of the originals of
such documents, agreements and instruments submitted to us as copies or
specimens, and the accuracy of the matters set forth in the documents,
agreements and instruments we reviewed. 
As to matters of fact relevant to the opinions expressed herein, we have
relied upon, and assumed the accuracy of, the representations and warranties
contained in the Credit Agreement and we have relied upon certificates and oral
or written statements and other information obtained from the Company, the
other parties to the transaction referenced herein, and public officials.  We have not undertaken any independent
investigation (including, without limitation, conducting any review, search or
investigation of any public files, records or dockets) to determine the existence
or absence of facts that are material to our opinions, and no inference as to
our knowledge concerning such facts should be drawn from our reliance on the
representations of the Company and others in connection with the preparation
and delivery of this letter.

 

We
have also assumed (x) the legal capacity of all natural persons and (y) that
all documents, agreements and instruments have been duly authorized, executed
and delivered by all parties thereto, that all such parties are validly
existing and in good standing under the laws of their

 

1

 

respective
jurisdictions of organization, that all such parties had the power and legal
right to execute and deliver all such documents, agreements and instruments,
and that, other than as set forth below, such documents, agreements and
instruments are legal, valid and binding obligations of such parties,
enforceable against such parties in accordance with their respective
terms.  As used herein, “to our knowledge”
or words of similar import mean the actual knowledge, without independent
investigation, of any lawyer in our firm actively involved in the transactions
contemplated by the Loan Documents.

 

With
respect to certain matters regarding the Company, we understand that you are
relying on the opinion of Douglas C. Taylor, Senior Vice President, General
Counsel and Corporate Development to the Company, and we express no opinion
regarding the matters set forth in such opinion, including, without limitation,
regulatory matters.

 

We
express no opinion concerning the laws of any jurisdiction other than the laws
of the State of New York.

 

Based upon and subject to the foregoing, we are of the
opinion that each of the Loan Documents constitutes a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, receivership or other laws relating to or affecting
creditors’ rights generally, and to general principles of equity (regardless of
whether enforcement is sought in a proceeding at law or in equity), and except
that the enforcement of rights with respect to indemnification and contribution
obligations may be limited by applicable law or considerations of public
policy.

 

Our
opinions expressed above regarding the legality, validity, binding effect and
enforceability of the Loan Documents mean that, subject to the other
qualifications herein set forth, one or more remedies for which provision is
made in a Loan Document will be available in the event of a material default by
the Company, which will permit the practical realization of the benefits
intended to be provided by such Loan Document. 
However, these opinions do not mean that any particular remedy for which
provision is made in a Loan Document will be available upon a default, or that
every provision of a Loan Document will be upheld or enforced in any particular
circumstance by a court.

 

We
express no opinion regarding: (a) interest on interest provisions; (b) judgment
in foreign currency provisions; (c) any provision purporting to waive or
limit rights to trial by jury; (d) any provisions waiving rights or
protective legal requirements; (e) any provisions that may be construed as
penalties or forfeitures; (f) any provision granting or purporting to
establish special or unusual remedies; (g) any waiver of statute of
limitations; (h) any provision purporting to waive or limit any right of
setoff; (i) limitations of liability; (j) indemnification or
exculpation for a party’s own wrongful or grossly negligent acts; (k) severability
clauses; (l) time is of the essences clauses; (m) any power of
attorney granted under the Credit Agreement; (n) any provision insofar as
it provides for the payment or reimbursement of costs and expenses or for
claims, losses or liabilities in excess of a reasonable amount determined by
any court or other tribunal; (o) any provision purporting to waive or
limit oral amendments of written agreements; (p) provisions relating to
jurisdiction, venue or service of process; or (q) interest rates which may
be usurious.

 

2

 

We are
furnishing this letter to you solely for your benefit in connection with the
transactions referred to herein; provided, that this letter may be
relied upon by any Lender party to the Loan Documents as of the date of this
letter.  Without our prior written
consent, this letter is not to be relied upon, used, circulated, quoted or otherwise
referred to by, or assigned to, any other person (including any person that
seeks to assert your rights in respect of this letter (other than your
successor in interest by means of merger, consolidation, transfer of a business
or other similar transaction)) or for any other purpose, except that (a) a
copy of this letter may be delivered by the Administrative Agent to those
Persons who are assignees, participants, potential assignees or potential
participants of any Lender and (b) a copy of this letter may be delivered
to your or any Lender’s regulators, accountants, attorneys and other
professional advisors; provided, that any Person who becomes a party to
the Loan Documents as a Lender may rely on this opinion as though it had been
addressed to such Person and delivered to such Person on the date hereof.  In addition, we disclaim any obligation to
update this letter for changes in fact or law, or otherwise.

 

Very
truly yours,

 

3

 

Schedule A

 

Bank of America, N.A.

as Administrative Agent
for the Lenders party to the Credit Agreement

 

and

 

Each of the Lenders party
to the Credit Agreement

 

4

 

EXHIBIT
F

 

REPORT OF LETTER OF CREDIT INFORMATION

 

Date:                    ,
20   

 

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

 

Ladies
and Gentlemen:

 

Reference is made to that
certain Credit Agreement, dated as of April 20, 2010 (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 Dayton Power and Light Company, an Ohio corporation
(the “Borrower”), the Lenders from time to time party thereto, Bank of
America, N.A., as Administrative Agent and an L/C Issuer, and PNC Capital
Markets, LLC and U.S. Bank National Association, as Co-Syndication Agents.

 

This report is
being delivered pursuant to Section 2.03(k) of the Credit
Agreement. Set forth in the table below is a description of each Letter of
Credit issued by the undersigned and outstanding on the date hereof.

 

	
  L/C No.

  	
   

  	
  Maximum

  Face Amount

  	
   

  	
  Current Face

  Amount

  	
   

  	
  Beneficiary

  Name

  	
   

  	
  Issuance

  Date

  	
   

  	
  Expiry

  Date

  	
   

  	
  Auto

  Renewal

  	
   

  	
  Date of

  Amendment

  	
   

  	
  Amount of

  Amendment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
  [APPLICABLE L/C ISSUER]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

F-1

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