DEPOSIT AGREEMENT
BETWEEN
THE BANK OF NEW YORK, as Book-Entry Depositary
and
TXU EASTERN FUNDING COMPANY, Issuer
Dated as of May 13, 1999
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions and Other General Provisions
Section 1.01. Definitions . . . . . . . . . . . . . . . . . 1
Section 1.02. Rules of Construction . . . . . . . . . . . . 4
ARTICLE II
Book-Entry Interests
Section 2.01. Deposit of the Global Senior Notes . . . . . . 4
Section 2.02. Book-Entry System . . . . . . . . . . . . . . 5
Section 2.03. Registration of Transfer of the Book-Entry
Interests . . . . . . . . . . . . . . . . . 7
Section 2.04. Transfer or Exchange of Global Senior Notes . 9
Section 2.05. Issuance of Certificated Registered Senior
Notes in Respect of the Senior Notes . . . . 10
Section 2.06. Redemption of the Senior Notes . . . . . . . . 11
Section 2.07. Cancellation . . . . . . . . . . . . . . . . . 11
Section 2.08. Payments in Respect of the Book-Entry
Interests and the Global Senior Notes . . . 11
Section 2.09. Change in Principal Amount of Global
Senior Notes . . . . . . . . . . . . . . . . 12
Section 2.10. Record Date . . . . . . . . . . . . . . . . . 12
Section 2.11. Action in Respect of the Book-Entry
Interests or the Global Senior Notes . . . . 12
Section 2.12. Reports and Notices . . . . . . . . . . . . . 13
Section 2.13. Additional Amounts . . . . . . . . . . . . . . 13
Section 2.14. Changes Affecting Global Senior Notes . . . . 13
ARTICLE III
The Book-Entry Depositary
Section 3.01. Certain Duties and Responsibilities . . . . . 13
Section 3.02. Events of Default . . . . . . . . . . . . . . 14
Section 3.03. Certain Rights of Book-Entry Depositary . . . 14
Section 3.04. Not Responsible for Recitals or Issuance
of Senior Notes . . . . . . . . . . . . . . 15
Section 3.05. Money Held in Trust . . . . . . . . . . . . . 15
Section 3.06. Compensation and Reimbursement . . . . . . . . 16
Section 3.07. Book-Entry Depositary Required; Eligibility . 16
Section 3.08. Resignation and Removal; Appointment
of Successor . . . . . . . . . . . . . . . . 17
Section 3.09. Acceptance of Appointment by Successor . . . . 18
Section 3.10. Merger, Conversion, Consolidation or
Succession to Business . . . . . . . . . . . 19
Section 3.11. Letters of Representations . . . . . . . . . . 19
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ARTICLE IV
Miscellaneous Provisions
Section 4.01. Notices to Book-Entry Depositary or Issuer . . 19
Section 4.02. Notice to DTC; Waiver . . . . . . . . . . . . 20
Section 4.03. Effect of Headings and Table of Contents . . . 20
Section 4.04. Successors and Assigns . . . . . . . . . . . . 20
Section 4.05. Separability Clause . . . . . . . . . . . . . 20
Section 4.06. Benefits of Agreement . . . . . . . . . . . . 20
Section 4.07. GOVERNING LAW . . . . . . . . . . . . . . . . 20
Section 4.08. Jurisdiction . . . . . . . . . . . . . . . . . 21
Section 4.09. Counterparts . . . . . . . . . . . . . . . . . 21
Section 4.10. Inspection of Agreement . . . . . . . . . . . 21
Section 4.11. Satisfaction and Discharge . . . . . . . . . . 21
Section 4.12. Amendments . . . . . . . . . . . . . . . . . . 22
Section 4.13. Book-Entry Depositary To Sign Amendments . . . 22
ii
DEPOSIT AGREEMENT
This Deposit Agreement (as the same may be amended from time
to time in accordance with the provisions hereof, the "Deposit
Agreement"), dated as of May 13, 1999, is among The Bank of New
York, a New York banking corporation, as book-entry depositary
with respect to the Global Senior Notes hereunder (the
"Book-Entry Depositary"), TXU Eastern Funding Company, a private
unlimited company incorporated under the laws of England and
Wales (the "Issuer"), and the holders and beneficial owners from
time to time of interests in the Book-Entry Interests.
ARTICLE I
DEFINITIONS AND OTHER GENERAL PROVISIONS
Section 1.01. Definitions.
Terms not defined herein have the meanings ascribed to them
in the Indenture. The following terms, as used herein, have the
following meanings:
"Book-Entry Depositary" means the party named as such in
this Agreement or its nominee or the custodian of either until a
successor shall have become such pursuant to Section 3.08 hereof,
and thereafter "Book-Entry Depositary" shall mean such successor
or its nominee or the custodian of either.
"Book-Entry Interests" means the certificateless depositary
interests that shall at all times, prior to any issuance of
Certificated Registered Senior Notes in respect thereof,
represent the right to receive 100% of the principal, premium (if
any) and interest on the underlying Senior Notes from time to
time received by the Book-Entry Depositary.
"Book-Entry Register" has the meaning ascribed thereto in
Section 2.03 hereof.
"Corporate Trust Office" means the office of the Book-Entry
Depositary in The City of New York, at which at any particular
time its corporate trust business shall be principally
administered, which at the date hereof is located at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: Corporate Trust Division,
Corporate Finance Group.
"Certificated Registered Senior Notes" means Senior Notes
issued by the Issuer pursuant to the Indenture substantially in a
form therefor included as an exhibit to the Officer's Certificate
and registered in the names of the beneficial owners thereof.
"DTC" means The Depository Trust Company, New York, New York
or any successor depositary with respect to the Book-Entry
Interests as recorded on the Book-Entry Register.
"Exchange Act" means the United States Securities Exchange
Act of 1934, as amended.
"Exchange Senior Notes" means any 6.15% Exchange Senior
Notes due May 15, 2002, 6.45% Exchange Senior Notes due May 15,
2005, and 6.75% Exchange Senior Notes due May 15, 2009 of the
Issuer issued in exchange for Initial Senior Notes pursuant to
the Registration Rights Agreement.
"Global Senior Notes" means Senior Notes in bearer form
issued by the Issuer to the Book-Entry Depositary pursuant to the
Indenture, substantially in the form included therefor as an
exhibit to the Officer's Certificate.
"Guarantor" means TXU Eastern Holdings Limited, a private
limited company incorporated under the laws of England and Wales.
"IAI Global Senior Notes" means those Global Senior Notes in
which Interests may be purchased by institutional "accredited
investors" as defined under Rule 501(a)(1), (2), (3) or (7) of
Regulation D of the Securities Act.
"IAI Purchaser" means an institutional "accredited investor"
who is not a Qualified Institutional Buyer who purchases an
Interest in an IAI Global Senior Note pursuant to Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities Act for
investment purposes and not for distribution in violation of the
Securities Act.
"Indenture" means the Indenture dated as of May 1, 1999,
among the Issuer, the Guarantor, and The Bank of New York, as
Trustee, relating to the Senior Notes as originally executed or
as it may from time to time be supplemented or amended including
by Officer's Certificate and, for all purposes to the extent
applicable, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern such instrument.
"Indirect Participant" has the meaning specified in Section
2.02 herein.
"Initial Purchasers" means ▇▇▇▇▇▇ Brothers Inc., ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated, ABN AMRO Incorporated, BNY Capital
Markets, Inc., Chase Securities Inc., Credit Suisse First Boston
Corporation, ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated,
NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities LLC, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
and Warburg Dillon Read LLC.
"Initial Senior Notes" means the 6.15% Senior Notes due May
15, 2002, the 6.45% Senior Notes due May 15, 2005, and the 6.75%
Senior Notes due May 15, 2009 of the Issuer.
"Interests" means beneficial interests in the Book-Entry
Interests that will be shown on records maintained by DTC or its
direct or indirect Participants.
"Issuer" means the party named as such in this Agreement
until a successor replaces it pursuant to the applicable
provisions of the Indenture and, thereafter, means such
successor.
"Issuer Order" means a written request or order signed in
the name of the Issuer by any officer of the Issuer or other
person duly authorized by the Board of Directors, and delivered
to the Book-Entry Depositary.
"Jurisdiction of Incorporation" means each jurisdiction in
which the Issuer or the Guarantor, as the case requires, is
incorporated or organized.
"Letters of Representations" means the Letters of
Representations to DTC relating to the Initial Senior Notes, each
dated May 13, 1999, from the Book-Entry Depositary and the
Issuer.
"Officer's Certificate" means the certificates signed in the
name of the Issuer by an officer or director of the Issuer or by
any other person duly authorized by the Board of Directors of the
Issuer and signed in the name of the Guarantor by an officer or
director of the Guarantor or by any other person duly authorized
by the Board of Directors of the Guarantor, each dated as of May
13, 1999 and establishing certain terms of the Senior Notes.
"officer's certificate" means a certificate signed in the
name of the Issuer by an Authorized Officer of the Issuer and
delivered to the Trustee or the Book-Entry Depositary, as the
case requires.
"144A Global Senior Notes" means those Global Senior Notes
in which Interests may be purchased by Qualified Institutional
Buyers under Rule 144A of the Securities Act.
"Opinion of Counsel" means a written opinion from legal
counsel, who may be an employee of or regular counsel for the
Issuer or may be other counsel reasonably acceptable to the
Book-Entry Depositary.
"Participant" has the meaning specified in Section 2.02
herein.
"Qualified Institutional Buyer" means a qualified
institutional buyer as defined in Rule 144A of the Securities Act
who purchases an Interest in a 144A Global Senior Note under Rule
144A.
"Registered Holder" means, with respect to any Book-Entry
Interest, the Person in whose name such Book-Entry Interest is
registered on the Book-Entry Register maintained by the
Book-Entry Depositary.
"Registration Rights Agreement" means the agreement, dated
May 13, 1999, among the Guarantor, the Issuer and the Initial
Purchasers of the Initial Senior Notes whereby, among other
things, the Guarantor and the Issuer have agreed to file a
registration statement with the US Securities and Exchange
Commission relating to an exchange offer pursuant to which
Exchange Senior Notes would be offered in exchange for Initial
Senior Notes.
"Reg S Global Senior Notes" means those Global Senior Notes
in which Interests may be purchased by foreign purchasers under
Regulation S of the Securities Act.
"Regulation S Purchaser" or "foreign purchaser" means a
person or entity residing outside of the United States who
purchases an Interest in a Reg S Global Senior Note pursuant to
Rule 904 of Regulation S of the Securities Act.
"Responsible Officer", when used with respect to the
Book-Entry Depositary, means any authorized officer of the
Book-Entry Depositary including any vice president, assistant
vice president, assistant secretary, treasurer, assistant
treasurer, or any other officer of the Book-Entry Depositary who
customarily performs functions similar to those performed by the
Persons who at the time shall be such officers, respectively, or
to whom any depositary matter is referred because of such
officer's knowledge of and familiarity with the particular
subject.
"Securities Act" means the United States Securities Act of
1933, as amended.
"Senior Notes" means the Initial Senior Notes and, upon
their issuance in accordance with the Registration Rights
Agreement, the Exchange Senior Notes.
"Taxing Jurisdiction" means (i) any supranational federation
to which a Jurisdiction of Incorporation belongs or (ii) any
Jurisdiction of Incorporation (or any political subdivision or
taxing authority thereof or therein) or any jurisdiction in which
the Issuer or the Guarantor is incorporated or in which the
Issuer or the Guarantor is managed and controlled or has a place
of business.
"Trustee" means The Bank of New York and its successors and
assigns, as trustee under the Indenture.
Section 1.02. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) "including" means including without limitation; and
(d) words in the singular include the plural and words in
the plural include the singular.
ARTICLE II
BOOK-ENTRY INTERESTS
Section 2.01. Deposit of the Global Senior Notes.
(a) The Book-Entry Depositary hereby accepts custody of the
Global Senior Notes and shall act as Book-Entry Depositary in
accordance with the terms of this Agreement. The Book-Entry
Depositary shall hold such Global Senior Notes at its Corporate
Trust Office in The City of New York, at the office of the paying
agent in Luxembourg or at such place as it shall determine with
the consent of the Issuer and shall issue the Book-Entry
Interests to DTC or its nominee in accordance with the Letters of
Representations.
(b) The 144A Global Senior Notes are identified by the
following CUSIP numbers:
6.15% Senior Notes due May 15, 2002 - ▇▇▇▇▇▇▇▇▇
6.45% Senior Notes due May 15, 2005 - ▇▇▇▇▇▇▇▇▇
6.75% Senior Notes due May 15, 2009 - ▇▇▇▇▇▇▇▇▇
(c) The Reg S Global Senior Notes are identified by the
following CUSIP numbers:
6.15% Senior Notes due May 15, 2002 - ▇▇▇▇▇▇▇▇▇
6.45% Senior Notes due May 15, 2005 - ▇▇▇▇▇▇▇▇▇
6.75% Senior Notes due May 15, 2009 - ▇▇▇▇▇▇▇▇▇
(d) The IAI Global Senior Notes are identified by the
following CUSIP numbers:
6.15% Senior Notes due May 15, 2002 - ▇▇▇▇▇▇▇▇▇
6.45% Senior Notes due May 15, 2005 - ▇▇▇▇▇▇▇▇▇
6.75% Senior Notes due May 15, 2009 - ▇▇▇▇▇▇▇▇▇
Section 2.02. Book-Entry System.
(a) Upon acceptance by DTC of the Book-Entry Interests for
entry into its book-entry settlement system in accordance with
the terms of the Letters of Representations, Interests in the
Book-Entry Interests will be recorded on and traded through DTC's
book-entry system, and beneficial ownership of such Interests
shall be shown in, and the transfer of such ownership shall be
effected only through, records maintained by (i) DTC or (ii)
institutions that have accounts with DTC ("Participants") or
(iii) institutions that have accounts directly or indirectly with
Participants ("Indirect Participants"). Interests shall be
transferable only as units representing authorized denominations
of the Senior Notes.
(b) The Book-Entry Interests shall be issuable only to DTC
or successors of DTC or their respective nominees. Except as
provided in Section 2.05, no beneficial owner of Interests shall
be entitled to receive a Certificated Registered Senior Note, and
such beneficial owner's Interests shall be reflected only in
accordance with the procedures of DTC as set forth in the Letters
of Representations.
(c) Transfers of the Book-Entry Interests and Interests
with respect to Initial Senior Notes shall be subject to the
restrictions on transfer provided in the legend set forth on the
face of the Global Senior Notes relating thereto. Such
restrictions will not apply to Book-Entry Interests and Interests
with respect to Exchange Senior Notes.
In addition, each purchaser of an Interest in the Initial
Senior Notes, by accepting such Interest, will be deemed to have
represented and agreed as follows:
(1) it is acquiring the Interest in the Initial Senior
Notes for its own account or for an account with respect to
which it exercises sole investment discretion, and that it
or such account, as the case may be, is a Qualified
Institutional Buyer, a foreign purchaser outside the US or
an institutional "accredited investor" acquiring the
beneficial interests in the senior notes for investment
purposes and not for distribution;
(2) it acknowledges that the offer and sale of the
Interests in the Initial Senior Notes have not been
registered under the Securities Act and such Interests may
not be resold except as permitted below;
(3) it understands and agrees that such Interests in
the Initial Senior Notes are being offered only in a
transaction not involving any public offering within the
meaning of the Securities Act, and that (A) if it decides to
resell, pledge or otherwise transfer such Interests in the
Initial Senior Notes to which the legend set forth below
applies, such Interests in the Initial Senior Notes may be
resold, pledged or transferred only (i) to the Issuer or the
Guarantor, (ii) in a transaction entitled to an exemption
from registration provided by Rule 144 under the Securities
Act, (iii) so long as such security is eligible for resale
pursuant to Rule 144A, to a person whom the seller
reasonably believes is a Qualified Institutional Buyer that
purchases for its own account or for the account of a
Qualified Institutional Buyer to whom notice is given that
the resale, pledge or transfer is being made in reliance on
Rule 144A, (iv) in an offshore transaction in accordance
with Rule 904 of Regulation S of the Securities Act, (v) to
an institutional "accredited investor" as defined in Rule
501(a)(1), (2), (3), or (7) of Regulation D under the
Securities Act acquiring the Interest in the Initial Senior
Notes, in a minimum principal amount of $250,000, for
investment purposes and not for distribution, or (vi)
pursuant to an effective registration statement under the
Securities Act, and (B) the purchaser will, and each
subsequent holder is required to, notify any purchaser of
Interests in Initial Senior Notes from it of the resale
restrictions referred to in (A) above, if then applicable.
Before any Interest in an Initial Senior Note may be
offered, sold, pledged or otherwise transferred by a
Qualified Institutional Buyer to a person who is not a
Qualified Institutional Buyer or by a Regulation S Purchaser
to a person who is not a Regulation S Purchaser, the
transferee and/or the transferor must provide the Trustee
with written certification (the form of which certification
is substantially in the form of Exhibit A to this Agreement
and which may be obtained from the Book-Entry Depositary) as
to the compliance with the transfer restrictions referred to
above. If any resale or other transfer of an Interest in
the Initial Senior Notes is proposed to be made pursuant to
clause (v) above, the transferor shall deliver a letter from
the transferee substantially in the form of Exhibit B to
this Agreement to the Issuer, the Guarantor and to the
Trustee, which shall provide, among other things, that the
transferee is an institutional "accredited investor" that is
acquiring such beneficial interest for investment purposes
and not for distribution in violation of the Securities Act.
Each purchaser of an Interest in the Initial Senior Notes
acknowledges that the Issuer, the Guarantor and the Trustee
reserve the right prior to any offer, sale or other transfer
of such Interest in the Initial Senior Notes pursuant to
clauses (ii), (iv) or (v) above to require the delivery of
an Opinion of Counsel, certifications and/or other
information satisfactory to the Issuer, the Guarantor and
the Trustee that the proposed sale complies with the
foregoing restrictions. An IAI Purchaser may not transfer
its Interest in an Initial Senior Note to another IAI
Purchaser.;
(4) it understands that the following legend will be
placed on the Initial Senior Notes unless otherwise agreed
by the Issuer:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR WITH ANY
SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER
JURISDICTION OF THE UNITED STATES AND MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED OTHER THAN (A) (1) TO TXU
EASTERN FUNDING COMPANY OR TXU EASTERN HOLDINGS LIMITED, (2)
IN A TRANSACTION ENTITLED TO AN EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT, (3) SO LONG
AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT
THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (4) IN AN OFFSHORE TRANSACTION IN
ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (5) TO AN INSTITUTION THAT IS AN "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT, IN A MINIMUM PRINCIPAL AMOUNT OF
THE SECURITIES OF $250,000, AND THAT IS ACQUIRING THE
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR
(6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, AND (B) IN EACH CASE IN ACCORDANCE WITH
ALL THE APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES";
(5) it (i) is able to fend for itself in the
transactions contemplated by the offering memorandum dated
May 6, 1999; (ii) has such knowledge and experience in
financial and business matters as to be capable of
evaluating the merits and risks of its prospective
investment in such Interest in the Initial Senior Notes;
(iii) has the ability to bear the economic risks of its
prospective investment and can afford the complete loss of
such investment; and (iv) acknowledges that it may be
required to bear the financial risks of this investment for
an indefinite period of time;
(6) if it is (i) a purchaser in a sale that occurs
outside the US within the meaning of Regulation S of the
Securities Act, or (ii) a "distributor," "dealer" or person
"receiving a selling concession, fee or other remuneration"
in respect of securities sold, prior to the expiration of
the Restricted Period (as defined below), it acknowledges
that until the expiration of the Restricted Period any offer
or sale of such Interest in the Initial Senior Notes shall
not be made by it to a US person or for the account or
benefit of a US person within the meaning of Rule 902(k) of
Regulation S of the Securities Act, except offers or sales
made pursuant to Rule 144A. The "Restricted Period" means,
with respect to Interests in the Initial Senior Notes, the
40-day period following the later of (i) the date on which
such Interests in Initial Senior Notes are first offered to
persons other than distributors (as defined in Regulation S)
and (ii) the original issue date of such Interests in
Initial Senior Notes;
(7) if it is a foreign purchaser, it acknowledges
that, until the expiration of the Restricted Period, it may
not, directly or indirectly, reoffer, resell, pledge or
otherwise transfer an Interest in the Initial Senior Notes
or any interest therein except to a person who certifies in
writing to the Trustee that such transfer satisfies, as
applicable, the requirements of the legend described above
and that none of the Interests in the Initial Senior Notes
will be accepted for registration of any transfer prior to
the end of the Restricted Period unless the transferee has
first complied with the certification requirements described
in this paragraph;
(8) it acknowledges that no part of the funds to be
used to purchase the Interest in the Initial Senior Notes to
be purchased by such purchaser constitutes assets which are
directly or indirectly the assets of any employee benefit
plan such that the use of such assets constitutes a non-
exempt prohibited transaction under the US Employee
Retirement Income Security Act of 1974, as amended (ERISA),
or the US Internal Revenue Code of 1986, as amended. As
used in this paragraph, the term "employee benefit plan"
shall have the meaning assigned to such term in Section 3 of
ERISA;
(9) it understands that the Issuer, the Guarantor, the
Initial Purchasers, the Trustee, the Paying Agents and
others will rely upon the truth and accuracy of the
foregoing acknowledgments, representations and agreements
and agrees that if any of the acknowledgments,
representations and warranties deemed to have been made by
it by its purchase of an Interest in the Initial Senior
Notes are no longer accurate, it shall promptly notify the
Issuer, the Guarantor and the Initial Purchasers. If it is
acquiring an Interest in the Initial Senior Notes as a
fiduciary or agent for one or more investor accounts, it
represents that it has sole investment discretion with
respect to each such account and it has full power to make
the foregoing acknowledgments, representations and
agreements on behalf of such account.
If the Issuer issues certificated Initial Senior Notes in
respect of the Initial Senior Notes in exchange for Interests in
the Initial Senior Notes, then all of the above agreements,
representations and warranties will apply to the certificated
Initial Senior Notes.
Section 2.03. Registration of Transfer of the Book-Entry
Interests.
(a) The Book-Entry Depositary agrees to maintain at the
Book-Entry Depositary's Corporate Trust Office the Book-Entry
Register in which the Book-Entry Depositary shall (i) record Cede
& Co., as nominee of DTC, as the initial registered owner of the
Book-Entry Interests and (ii) record the registration and
transfer of the Book-Entry Interests. The Book-Entry Depositary
shall maintain a place of transfer at its Corporate Trust Office
in The City of New York. The Book-Entry Depositary shall not
recognize any transfer of the Book-Entry Interests unless and
until such transfer is recorded on the Book-Entry Register. The
Book-Entry Depositary shall not constitute the agent of the
Issuer for any other purpose and, in particular, it shall not
constitute the agent of the Issuer in relation to any payments it
may make to DTC in respect of the Book-Entry Interests or be
authorized to undertake any obligations on behalf of the Issuer.
(b) The foregoing paragraph shall not (i) impose an
obligation on the Book-Entry Depositary to record the ownership
interests in or transfers of Interests held by Participants or
their successors or Indirect Participants or (ii) restrict
transfers of such Interests held by Participants or Indirect
Participants. The Book-Entry Depositary shall treat DTC or its
nominee as the absolute owner of the Book-Entry Interests for all
purposes whatsoever and shall not be bound or affected by any
notice to the contrary, other than an order enforceable against
the Book-Entry Depositary.
(c) Unless and until Global Senior Notes are exchanged for
Certificated Registered Senior Notes pursuant to Section 2.05,
the Book-Entry Depositary may not register the transfer of the
Book-Entry Interests except: (i) by DTC to its nominee; (ii) by
a nominee of DTC to DTC or to another nominee of DTC; (iii) by
DTC or any nominee to a successor depositary or a nominee of such
successor depositary; or (iv) from one Book-Entry Interest to
another Book-Entry Interest owned by DTC or its nominee. The
transfers described in clauses (i), (ii) and (iii) of this
paragraph shall only be made as a whole.
(d) The Book-Entry Depositary shall register the transfer
of a Book-Entry Interest in a Reg S Global Senior Note or an IAI
Global Senior Note to a Book-Entry Interest in a corresponding
144A Global Senior Note upon receipt of the following:
(1) instructions from DTC to make the transfer in a
specified principal amount and identifying the transferor of
the corresponding Interest;
(2) a written certification by the transferor of the
Interest to the effect that the transfer of the Interest is
being made to a Person whom the transferor reasonably
believes is a Qualified Institutional Buyer within the
meaning of Rule 144A under the Securities Act purchasing for
its own account or for the account of a Qualified
Institutional Buyer to whom notice is given that the resale,
pledge or other transfer is being made in reliance on Rule
144A (which may be in the form of Exhibit A hereto); and
(3) until the expiration of the Restricted Period, if
the transferor of the Interest is a foreign purchaser, the
written certification described in Section 2.02(c)(7)
hereof.
(e) The Book-Entry Depositary shall register the transfer
of a Book-Entry Interest in a 144A Global Senior Note or a Reg S
Global Senior Note to a Book-Entry Interest in a corresponding
IAI Global Senior Note upon receipt of the following:
(1) instructions from DTC to make the transfer in a
specified principal amount and identifying the transferor
and transferee of the corresponding Interest;
(2) a written certification by the transferor of the
Interest that the transfer of the Interest is being made to
an institution that is an "accredited investor" as defined
in Rule 501(a)(1), (2), (3) or (7) under the Securities Act
and that is acquiring such Interest for investment purposes
and not for distribution (which may be in the form of
Exhibit A hereto);
(3) a letter signed by the transferee of the Interest
substantially in the form of Exhibit B hereto or
confirmation from the Company, the Guarantor and the Trustee
that such a letter has been delivered to them; and
(4) such other opinion of counsel, certifications and
other information as the Company, the Guarantor or the
Trustee may request.
Interests in IAI Global Senior Notes may not be transferred
to another IAI Purchaser.
(f) The Book-Entry Depositary shall register the transfer
of a Book-Entry Interest in a 144A Global Senior Note or an IAI
Global Senior Note to a Book-Entry Interest in a corresponding
Reg S Global Senior Note upon receipt of the following:
(1) instructions from DTC to make the transfer in a
specified principal amount and identifying the transferor of
the corresponding Interest;
(2) a written certification by the transferor of the
Interest that the transfer of the Interest is being made in
an offshore transaction in accordance with Rule 904 of
Regulation S under the Securities Act or (if available) Rule
144 under the Securities Act (which may be in the form of
Exhibit A hereto); and
(3) such other opinion of counsel, certifications and
other information as the Company, the Guarantor or the
Trustee may request.
(g) The authorized denominations for transfers of Book-
Entry Interests and Interests shall be a minimum principal amount
of $10,000 and additional multiples of $1,000 for principal
amounts over $10,000 except that each transfer of a Book-Entry
Interest in an IAI Global Senior Note shall be in a minimum
principal amount of $250,000 and additional multiples of $1,000
for principal amounts over $250,000.
Section 2.04. Transfer or Exchange of Global Senior Notes.
(a) The Book-Entry Depositary shall hold the Global Senior
Notes in custody for the benefit of DTC. Subject to this Section
and Section 3.08, the Book-Entry Depositary shall not transfer or
lend the Global Senior Notes or any interest therein, except that
the Global Senior Notes, as a whole and with the Issuer's
consent, may be transferred (i) by the Book-Entry Depositary to a
nominee of the Book-Entry Depositary; (ii) by a nominee of the
Book-Entry Depositary to another nominee of the Book-Entry
Depositary; or (iii) by the Book-Entry Depositary or any such
nominee to a successor Book-Entry Depositary or a nominee of such
successor Book-Entry Depositary. Notwithstanding the foregoing,
the Book-Entry Depositary may not under any circumstances
surrender or deliver the Global Senior Notes to DTC.
(b) The Book-Entry Depositary shall, upon the request of
the Issuer or the Trustee, exchange Global Senior Notes with
respect to Initial Senior Notes for Global Senior Notes with
respect to the corresponding Exchange Senior Notes, consistent
with the terms of the Indenture upon consummation of the
transactions contemplated by the Registration Rights Agreement.
(c) Upon the registration of a transfer of a specified
principal amount from one Book-Entry Interest to another Book-
Entry Interest as provided in Section 2.03, the Book-Entry
Depositary shall deliver the corresponding Global Senior Notes to
the Trustee for an endorsement on the reverse of the Global
Senior Notes to reflect the adjusted principal amounts or in
exchange for replacement Global Senior Notes in the necessary
adjusted principal amounts to reflect such transfer.
(d) Upon the date specified in a written notice of
redemption of all or part of one or more Global Senior Notes
delivered to the Book-Entry Depositary by or on behalf of the
Issuer, the Book-Entry Depositary shall present such Global
Senior Notes to the Trustee or other Paying Agent for payment of
the amounts specified in such notice and, if such Global Senior
Notes are to be redeemed in part, for one or more replacement
Global Senior Notes in the principal amount not redeemed.
Section 2.05. Issuance of Certificated Registered Senior Notes
in Respect of the Senior Notes.
Except as provided in this Section 2.05, no beneficial owner
of Interests shall be entitled to receive Certificated Registered
Senior Notes.
The Book-Entry Depositary will promptly notify the Trustee
and request in writing that the Issuer issue and the Trustee
authenticate and deliver Certificated Registered Senior Notes in
exchange for Global Senior Notes with respect to the Senior
Notes, as a whole but not in part, in such names and authorized
denominations as the Book-Entry Depositary shall specify, if:
(i) DTC notifies the Issuer and the Book-Entry Depositary that it
is unwilling or unable to continue to hold the Book-Entry
Interests related to such Global Senior Notes or DTC at any time
ceases to be a "clearing agency" registered as such under the
Exchange Act and, in either case, a successor is not appointed by
the Issuer within 120 days; (ii) the Book-Entry Depositary
notifies the Issuer under Section 3.08 hereof that it is
unwilling or unable to continue as Book-Entry Depositary and no
successor Book-Entry Depositary is appointed within 120 days; or
(iii) the Issuer in its sole discretion executes and delivers to
the Trustee an officer's certificate providing that the related
Global Senior Notes shall be so exchangeable for Certificated
Registered Senior Notes. The Book-Entry Depositary agrees that
in such event it will promptly surrender the related Global
Senior Notes held by it to the Trustee in connection with such
exchange and request in writing that the Issuer execute and the
Trustee authenticate and deliver without charge Certificated
Registered Senior Notes, having the same interest rate, if any,
and maturity and having the same terms as the Interests of the
requesting owner, in authorized denominations of $10,000 and
additional multiples of $1,000 for principal amounts over $10,000
thereof (except that Certificated Registered Senior Notes issued
to owners of Interests in an IAI Global Senior Note shall not be
issued in a principal amount of less than $250,000) and of an
aggregate principal amount equal to such owner's Interests and
that such Global Senior Notes will be canceled upon issuance of
such Certificated Registered Senior Notes.
The Global Senior Notes shall also be exchangeable, in whole
or in part, for Certificated Registered Senior Notes if there
shall have occurred and be continuing an Event of Default with
respect to one or more series of the Senior Notes. In such
circumstances, beneficial owners of Interests relating to the
Global Senior Notes may request in writing through DTC's
procedures that their Interests be exchanged for one or more
Certificated Registered Senior Notes (an "Optional Certificated
Security Request"). Upon receipt of any such written request,
the Book-Entry Depositary shall (i) promptly surrender the
relevant Global Senior Note to the Trustee and request in writing
that the Trustee authenticate and deliver without charge
Certificated Registered Senior Notes, having the same interest
rate, if any, and maturity and having the same terms as the
Interests of the requesting owner, in authorized denominations of
$10,000 and additional multiples of $1,000 for principal amounts
in excess of $10,000 thereof (except that Certificated Registered
Senior Notes issued to owners of Interests in an IAI Global
Senior Note shall not be issued in a principal amount of less
than $250,000 and additional multiples of $1,000 for principal
amounts over $250,000) and of an aggregate principal amount equal
to such owner's Interests; and (ii) if the Global Senior Note is
being exchanged (x) as a whole, then the surrendered Global
Senior Note shall be canceled by the Trustee, or (y) in part,
then the principal amount of the surrendered Global Senior Note
shall be reduced by an endorsement on the reverse of the Global
Senior Note or in exchange for a substitute Global Senior Note in
the reduced principal amount. In no event will the owner of an
Interest be entitled to receive Certificated Registered Senior
Notes in bearer form.
All costs (taxes, governmental charges or otherwise) related
to the issuance of Certificated Registered Senior Notes will be
borne by the Issuer subject to any exceptions set forth in the
Indenture.
Section 2.06. Redemption of the Senior Notes.
In the event that the Issuer exercises any right to redeem
the Senior Notes in whole or in part, the Book-Entry Depositary,
as holder of Global Senior Notes, shall, upon notice from the
Issuer or the Trustee, as the case may be, surrender the Global
Senior Notes at a place of payment or such other place as the
Issuer may designate, and deliver such Global Senior Notes to the
Trustee for cancellation or for reduction of principal amount by
an endorsement on the reverse thereof or in exchange for a
substitute Global Senior Note, as the case may be.
Section 2.07. Cancellation.
If the Global Senior Notes are surrendered for payment, for
redemption in whole or for exchange in whole for Certificated
Registered Notes to any Person other than the Trustee, such
Global Senior Notes shall be surrendered to the Security
Registrar for cancellation.
Section 2.08. Payments in Respect of the Book-Entry Interests
and the Global Senior Notes.
(a) Whenever the Book-Entry Depositary, as holder of the
Global Senior Notes, shall receive from the Trustee (or other
paying agent under the Indenture) any payment on the Global
Senior Notes, such payments shall be distributed promptly to DTC
on the payment date for the Global Senior Notes. The Book-Entry
Depositary shall maintain a place of payment at its Corporate
Trust Office in The City of New York. The payment date for the
Book-Entry Interests for payment of any principal or interest
shall be the same date as the payment date for the related Global
Senior Notes. So long as DTC or its nominee is the registered
owner of the Book-Entry Interests, such payments shall be made in
accordance with the Letters of Representations.
(b) The Book-Entry Depositary will forward to the Issuer or
its agents such information from its records as the Issuer may
reasonably request in writing to enable the Issuer or its agents
to file necessary reports with governmental agencies, and the
Book-Entry Depositary, the Issuer or their agents may (but shall
not be required to) file any such reports necessary to obtain
benefits under any applicable tax treaties for DTC or the
beneficial owners of Interests.
(c) Notwithstanding any other provisions of this Agreement,
the Book-Entry Depositary shall be required to pay to DTC only
amounts (including Additional Amounts) received by the Book-Entry
Depositary from the Issuer under the Global Senior Notes or the
Guarantor pursuant to the Guarantee.
(d) Neither the Issuer, the Guarantor nor any agent of the
Issuer or the Guarantor (including but not limited to any paying
agent) will have any responsibility or liability for any aspect
relating to payments (including payments of Additional Amounts,
if any) made or to be made by the Book-Entry Depositary to DTC in
respect of the Global Senior Notes or the Book-Entry Interests.
None of the Issuer, the Guarantor, the Trustee, the Book-Entry
Depositary or any agent of any of the foregoing will have any
responsibility or liability for any aspect relating to payments
(including payments of Additional Amounts, if any) made or to be
made by DTC on account of a Participant's or Indirect
Participant's ownership of an Interest or for maintaining,
supervising or reviewing any records relating to a Participant's
Interests.
Section 2.09. Change in Principal Amount of Global Senior Notes.
Whenever the principal amount at maturity of the Global
Senior Notes held by the Book-Entry Depositary is changed by the
Trustee as a result of partial redemption or otherwise, the
Book-Entry Depositary shall record on the Book-Entry Register a
corresponding change in the principal amount of the related
Book-Entry Interests and notify DTC of such corresponding change
in accordance with the Letters of Representations.
Section 2.10. Record Date.
Whenever the Book-Entry Depositary shall receive notice of
any action to be taken in respect of the Book-Entry Interests or
Global Senior Notes, or whenever the Book-Entry Depositary
otherwise deems it appropriate in respect of any other matter,
the Book-Entry Depositary shall fix a record date to determine
who shall be entitled to take any such action or to act in
respect of any such matter.
Subject to the provisions of this Agreement, only DTC shall
be entitled to receive any such payment, to give instructions as
to such action or to act in respect of any such matter.
Section 2.11. Action in Respect of the Book-Entry Interests or
the Global Senior Notes.
(a) Not later than 10 days from receipt by the Book-Entry
Depositary of notice of any solicitation of consents or request
for a waiver or other action with respect to the Book-Entry
Interests or the Global Senior Notes under this Agreement or the
Indenture, the Book-Entry Depositary shall mail to DTC a notice
containing (i) such information as is contained in such notice,
(ii) a statement of the record date with respect to such consent,
waiver or other action, (iii) a statement that, on or prior to a
specified date (which specified date may be set no later than 180
days after the record date) (the "Expiration Date"), DTC will be
entitled, subject to the provisions of or governing the
Book-Entry Interests or Global Senior Notes, as the case may be,
to instruct the Book-Entry Depositary as to such consent, waiver
or such action, and (iv) a statement specifying the manner in
which such instructions may be given. Upon receipt by the
Book-Entry Depositary of instructions from DTC on or prior to the
Expiration Date and in the specified manner, the Book-Entry
Depositary shall endeavor (insofar as practicable and permitted
under the provisions of or governing the Book-Entry Interests or
Global Senior Notes, as the case may be), to take such measures
regarding the requested consent, waiver or other action in
respect of such Book-Entry Interests or Global Senior Notes, as
the case may be, as shall be in accordance with DTC's
instructions subject to Section 3.03(f). The Book-Entry
Depositary shall not itself exercise any discretion in the
granting of consents or waivers or the taking of any other action
in respect of the Book-Entry Interests or Global Senior Notes, as
the case may be.
(b) DTC may direct the time, method and place of conducting
any proceeding for any remedy available to the Book-Entry
Depositary or of exercising any rights or duties conferred on the
Book-Entry Depositary. However, the Book-Entry Depositary will
not exercise any discretion in the granting of consents or the
taking of any other action in respect of the Book-Entry Interests
or the Global Senior Notes but it may refuse to follow any
direction that conflicts with law or this Agreement or the
Indenture or the Senior Notes, subject to Section 3.01 hereof,
that the Book-Entry Depositary determines would involve it in
personal liability.
Section 2.12. Reports and Notices.
The Book-Entry Depositary shall promptly (and in no event
later than 10 days from receipt) send to DTC a copy of any
notices, reports and other communications received by it relating
to the Issuer, the Senior Notes or the Book-Entry Interests.
Section 2.13. Additional Amounts.
The Book-Entry Depositary shall pay to DTC any Additional
Amounts, as defined in the Officer's Certificate, that have been
paid by the Issuer or the Guarantor to the Book-Entry Depositary.
At least 10 days prior to the first interest payment date,
and at least 10 days prior to each succeeding interest payment
date if there has been any change with respect to the matters set
forth in the below-mentioned officer's certificate, the Issuer
will furnish the Book-Entry Depositary with an officer's
certificate instructing the Book-Entry Depositary whether such
payment of principal, premium, if any, or interest on such
Book-Entry Interests shall be made to DTC without deduction or
withholding for or on account of any Gross-Up Taxes. If any such
deduction or withholding shall be required, prior to such
interest payment date the Issuer will furnish the Book-Entry
Depositary with an officer's certificate that specifies the
amount required to be deducted or withheld on such payment. The
Issuer shall indemnify the Book-Entry Depositary, its officers,
directors and employees for, and hold it and them harmless
against, any loss, liability or expense reasonably incurred
without negligence, willful misconduct or bad faith on its part
arising out of or in connection with actions taken or omitted by
it in reliance on any officer's certificate furnished to it
pursuant to this Section 2.13.
Section 2.14. Changes Affecting Global Senior Notes.
Upon any reclassification of the Global Senior Notes, or
upon any recapitalization, reorganization, merger or
consolidation or sale of assets affecting the Issuer or to which
it is a party, or upon an exchange of the Global Senior Notes
pursuant to the Indenture, any securities that shall be received
by the Book-Entry Depositary in exchange for, in conversion of or
in respect of the Global Senior Notes shall be treated as new
Global Senior Notes under this Agreement and the Book-Entry
Interests shall thenceforth represent beneficial interests in
such new Global Senior Notes so received.
ARTICLE III
THE BOOK-ENTRY DEPOSITARY
Section 3.01. Certain Duties and Responsibilities.
(a) The Book-Entry Depositary undertakes to perform such
duties and only such duties as are specifically set forth in this
Agreement and no implied covenants or obligations shall be read
into this Agreement against the Book-Entry Depositary.
(b) In the absence of bad faith on its part, the Book-Entry
Depositary may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Book-Entry
Depositary and conforming to the requirements of this Agreement,
but in the case of any such certificates or opinions which by any
provision hereof are specifically required to be furnished to the
Book-Entry Depositary, the Book-Entry Depositary shall examine
the same to determine whether or not they conform to the
requirements of this Agreement.
(c) No provision of this Agreement shall be construed to
relieve the Book-Entry Depositary from liability for its own
negligent action, its own negligent failure to act or its own
willful misconduct, except that:
(i) the Book-Entry Depositary shall not be liable for
any error of judgment made in good faith by a Responsible
Officer of the Book-Entry Depositary, unless the Book-Entry
Depositary was negligent in ascertaining the pertinent
facts; and
(ii) the Book-Entry Depositary shall not be liable with
respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of DTC relating
to the time, method and place of conducting any proceeding
for any remedy available to the Book-Entry Depositary, or
exercising any power conferred upon the Book-Entry
Depositary, under this Agreement or the Indenture.
(d) No provision of this Agreement shall require the
Book-Entry Depositary to spend or risk its own funds or otherwise
incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk
or liability satisfactory to the Book-Entry Depositary has not
been reasonably assured to it.
(e) Whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting
the liability of or affording protection to the Book-Entry
Depositary shall be subject to the provisions of this Section
3.01.
Section 3.02. Events of Default.
Upon the occurrence of any Event of Default or in connection
with any other right of the holder of the Global Senior Notes
under the Indenture, and if requested by notice in writing by the
Registered Holder, the Book-Entry Depositary shall take such
action as shall be requested in such notice in respect of the
Global Senior Notes.
Section 3.03. Certain Rights of Book-Entry Depositary.
Subject to the provisions of Section 3.01 hereof:
(a) the Book-Entry Depositary may rely and shall be
protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(b) any request or direction of the Issuer mentioned herein
shall be sufficiently evidenced by an officer's certificate or
Issuer Order or as otherwise expressly provided herein and any
resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) the Book-Entry Depositary may consult with counsel, and
may rely upon the written advice of such counsel or any Opinion
of Counsel and shall be protected in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(d) the Book-Entry Depositary shall not be bound to make
any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document,
but the Book-Entry Depositary, in its discretion, may make such
further inquiry or investigation into such facts or matters as it
may see fit, and, if the Book-Entry Depositary shall determine to
make such further inquiry or investigation, it shall be entitled
upon reasonable prior request and during normal business hours to
examine the books, records and premises of the Issuer, personally
or by agent or attorney;
(e) the Book-Entry Depositary may execute any of the rights
hereunder or perform any duties hereunder either directly or by
or through agents or attorneys, but the Book-Entry Depositary
shall be responsible for any misconduct or negligence on the part
of any such agent or attorney appointed by it hereunder;
(f) the Book-Entry Depositary shall be under no obligation
to expend or risk its own funds or to exercise, at the request or
direction of DTC, any of the rights or powers vested in it by
this Agreement or the Indenture unless DTC shall have offered to
the Book-Entry Depositary security or indemnity satisfactory to
the Book-Entry Depositary against the costs, expenses and
liabilities that might be incurred by it in compliance with such
request or direction;
(g) whenever in the administration of its duties under this
Agreement the Book-Entry Depositary shall deem it desirable that
a matter be proved or established prior to taking or suffering or
omitting any action hereunder, the Book-Entry Depositary (unless
other evidence be herein specifically prescribed) may, in the
absence of negligence or bad faith on its part, rely upon an
officer's certificate.
Section 3.04. Not Responsible for Recitals or Issuance of Senior
Notes.
The recitals contained in the Indenture and in the Senior
Notes, except the Trustee's certificates of authentication, shall
be taken as the statements of the Issuer, and the Guarantor, as
the case may be, and the Book-Entry Depositary assumes no
responsibility for their correctness. The Book-Entry Depositary
makes no representations as to the validity or sufficiency of
this Agreement, the Indenture or of the Senior Notes. The
Book-Entry Depositary shall not be accountable for the use or
application by the Issuer of the proceeds with respect to the
Senior Notes.
Section 3.05. Money Held in Trust.
Money held by the Book-Entry Depositary in trust hereunder
need not be segregated from other funds held by the Book-Entry
Depositary, except to the extent required by law. The Book-Entry
Depositary shall be under no obligation to invest or pay interest
on any money received by it hereunder, except as otherwise agreed
in writing with the Issuer. Any interest accrued on funds
deposited with the Book-Entry Depositary under this Agreement
shall be paid to the Issuer from time to time and DTC shall have
no claim to any such interest.
Section 3.06. Compensation and Reimbursement.
The Issuer agrees:
(a) to pay to the Book-Entry Depositary from time to time
such compensation as is agreed upon in writing for services
rendered by it hereunder;
(b) except as otherwise expressly provided herein, to
reimburse the Book-Entry Depositary upon its request for all
reasonable expenses, disbursements and advances incurred or made
by the Book-Entry Depositary in accordance with any provision of
this Agreement (including the reasonable compensation and the
reasonable expenses and disbursements of its agents and counsel,
which compensation, expenses and disbursements shall be set forth
in sufficient written detail to the satisfaction of the Issuer),
except any such expense, disbursement or advance as may be
attributable to its or their negligence, willful misconduct or
bad faith; and
(c) to indemnify the Book-Entry Depositary for, and to hold
it harmless against, any loss, liability or expense incurred
without negligence, bad faith or willful misconduct on its part
arising out of or in connection with the acceptance or
administration of this Agreement and its duties hereunder,
including the costs and expenses of defending itself against any
claim of liability in connection with the exercise or performance
of any of its powers or duties hereunder. The Indemnity provided
by this Section 3.06(c) shall survive the satisfaction and
discharge of this Agreement pursuant to Section 4.11 hereof and
the termination of this Agreement for any reason.
In case any claim shall be made or action brought against
the Book-Entry Depositary for any reason for which indemnity may
be sought against the Issuer in accordance with paragraph (c)
above, the Book-Entry Depositary shall promptly notify the Issuer
in writing setting forth the particulars of such claim or action
and the Issuer may assume the defense thereof. In the event that
the Issuer elects to assume such defense and select such counsel,
the Book-Entry Depositary shall have the rights to employ its own
counsel, but, in any such case, the fees and expenses of such
counsel shall be at the expense of the Book-Entry Depositary,
unless (i) the Issuer agreed in writing to pay such fees and
expenses or (ii) the named parties to any such action (including
any impleaded parties) include both the Book-Entry Depositary and
the Issuer and the Book-Entry Depositary shall have been advised
by its counsel that a conflict of interest between the Book-Entry
Depositary and the Issuer may arise (and Issuer's counsel shall
have concurred with such advise) and for this reason it is not
desirable for the Issuer's counsel to represent both the
Book-Entry Depositary and the Issuer (it being understood,
however, that the Issuer shall not, in connection with any one
such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for reasonable fees and
expenses of more than one separate firm of attorneys for the
Book-Entry Depositary (plus any local counsel retained by the
Book-Entry Depositary in their reasonable judgement), which firm
shall be designated in writing by the Book-Entry Depositary).
The Book-Entry Depositary agrees to give all assistance
reasonably required in connection with the conduct of any such
claim or action.
Section 3.07. Book-Entry Depositary Required; Eligibility.
At all times when there is a Book-Entry Depositary
hereunder, such Book-Entry Depositary shall be a corporation
organized and doing business under the laws of the United States
of America, any state thereof or the District of Columbia,
having, together with its parents, a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by
Federal, state or District of Columbia authority and willing to
act on reasonable terms. Such corporation shall have its
principal place of business in the Borough of Manhattan, The City
of New York, if there be such a corporation in such location
willing to act upon reasonable and customary terms and
conditions. If such corporation, or its parent, publishes
reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section 3.07, the combined capital
and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent
report of condition so published.
The Book-Entry Depositary hereunder shall at all times be
the Trustee under the Indenture, subject to receipt of an Opinion
of Counsel that the same Person is precluded by law from acting
in such capacities. If at any time the Book-Entry Depositary
shall cease to be eligible in accordance with the provisions of
this Section 3.07, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article.
Section 3.08. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Book-Entry Depositary
and no appointment of a successor Book-Entry Depositary pursuant
to this Article shall become effective until (i) the acceptance
of appointment by the successor Book-Entry Depositary in
accordance with the applicable requirements of Section 3.09
hereof or (ii) the issuance of Certificated Registered Senior
Notes for all Global Senior Notes in accordance with Section 2.05
hereof and the Indenture.
(b) The Book-Entry Depositary may at any time resign as
Book-Entry Depositary with respect to the Global Senior Notes by
giving written notice thereof to the Issuer and DTC, in
accordance with Section 4.01 and Section 4.02 hereof, 60 days
prior to the effective date of such resignation. The Book-Entry
Depositary may be removed at any time upon 90 days' notice by the
filing with it of an instrument in writing signed on behalf of
the Issuer and specifying such removal and the date when it is
intended to become effective. If the instrument of acceptance by
a successor Book-Entry Depositary required by Section 3.09 hereof
shall not have been delivered to the Book-Entry Depositary within
30 days after the giving of such notice of resignation or
removal, the resigning Book-Entry Depositary may petition any
court of competent jurisdiction for the appointment of a
successor Book-Entry Depositary.
(c) If at any time:
(i) the Book-Entry Depositary shall cease to be
eligible under Section 3.07 hereof, or shall cease to be
eligible as Trustee under the Indenture, and shall fail to
resign after written request therefor by the Issuer or by
DTC, or
(ii) the Book-Entry Depositary shall become incapable
of acting with respect to the Book-Entry Interests or shall
be adjudged a bankrupt or insolvent, or a receiver or
liquidator of the Book-Entry Depositary or of its property
shall be appointed or any public officer shall take charge
or control of the Book-Entry Depositary or of its property
or affairs for the purpose of rehabilitation, conservation
or liquidation,
then, in any such case, (i) the Issuer, by Board Resolution, may
remove the Book-Entry Depositary and appoint a successor
Book-Entry Depositary, and (ii) if the Issuer shall fail to
remove such Book-Entry Depositary and appoint a successor
Book-Entry Depositary within 30 days of any such event, then DTC
may, on behalf of itself and all others similarly situated,
petition any court of competent jurisdiction for the removal of
the Book-Entry Depositary or Book-Entry Depositaries and the
appointment of a successor Book-Entry Depositary, unless
Certificated Registered Senior Notes have been issued in
accordance with the Indenture.
(d) If the Book-Entry Depositary shall resign, be removed
or become incapable of acting, or if a vacancy shall occur in the
office of Book-Entry Depositary for any cause, the Issuer, by
Board Resolution, shall promptly appoint a successor Book-Entry
Depositary (other than the Issuer) and shall comply with the
applicable requirements of Section 3.09 hereof. If no successor
Book-Entry Depositary with respect to the Global Senior Notes
shall have been so appointed by the Issuer and accepted
appointment in the manner required by Section 3.09 within 120
days of any such resignation, removal, incapacity or vacancy,
then DTC may request that Certificated Registered Senior Notes in
such names and denominations as DTC shall instruct in writing
with respect to such Global Senior Notes be issued. The
Book-Entry Depositary will thereupon surrender such Global Senior
Notes to the Trustee for cancellation and the Trustee shall
distribute such Certificated Registered Senior Notes in
accordance with the instructions of DTC.
(e) The Issuer shall give, or shall cause such successor
Book-Entry Depositary at the expense of the Issuer to give,
notice of each resignation and each removal of a Book-Entry
Depositary and each appointment of a successor Book-Entry
Depositary to DTC in accordance with Section 4.02 hereof.
Each notice shall include the name of the successor
Book-Entry Depositary and the address of its Corporate Trust
Office.
Section 3.09. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Book-Entry Depositary, every such successor Book-Entry Depositary
so appointed shall execute, acknowledge and deliver to the Issuer
and to the retiring Book-Entry Depositary an instrument accepting
such appointment, and thereupon the resignation or removal of the
retiring Book-Entry Depositary shall become effective and such
successor Book-Entry Depositary, without any further act, deed or
conveyance, shall become vested with all the rights, powers,
agencies and duties of the retiring Book-Entry Depositary, with
like effect as if originally named as Book-Entry Depositary
hereunder; but, on the request of the Issuer or the successor
Book-Entry Depositary, such retiring Book-Entry Depositary shall
(i) execute and deliver an instrument transferring to such
successor Book-Entry Depositary all the rights and powers of the
retiring Book-Entry Depositary and (ii) duly assign, transfer and
deliver to such successor Book-Entry Depositary all property and
money held by such retiring Book-Entry Depositary hereunder. Any
retiring Book-Entry Depositary shall, nonetheless, retain a prior
claim upon all property or funds held or collected by such
Book-Entry Depositary to secure any amounts then due it pursuant
to Section 3.06 hereof except to the extent that such prior claim
and security would breach or constitute a default under the
Indenture or Senior Notes.
(b) Upon request of any such successor Book-Entry
Depositary, the Issuer shall execute any and all instruments for
more fully and certainly vesting in and confirming to such
successor Book-Entry Depositary all such rights, powers and
agencies referred to in paragraph (a) of this Section 3.09.
(c) No successor Book-Entry Depositary shall accept its
appointment unless at the time of such acceptance such successor
Book-Entry Depositary shall be eligible under this Article.
(d) Upon acceptance of appointment by any successor
Book-Entry Depositary as provided in this Section 3.09, the
Issuer shall give notice thereof to DTC in accordance with
Section 4.02 hereof. If the acceptance of appointment is
substantially contemporaneous with the resignation of the
Book-Entry Depositary, then the notice called for by the
preceding sentence may be combined with the notice called for by
Section 3.08(b) hereof. If the Issuer fails to give such notice
within 10 days after acceptance of appointment by the successor
Book-Entry Depositary, the successor Book-Entry Depositary shall
cause such notice to be given at the expense of the Issuer.
Section 3.10. Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Book-Entry Depositary may be
merged or converted or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to
which the Book-Entry Depositary shall be a party, or any
corporation succeeding to all or substantially all the corporate
trust business of the Book-Entry Depositary, shall be the
successor of the Book-Entry Depositary hereunder, without the
execution or filing of any paper or any further act on the part
of any of the parties hereto.
Section 3.11. Letters of Representations.
The Book-Entry Depositary agrees to comply with all of the
provisions set forth in the Letters of Representations so long as
DTC is the holder of the Book-Entry Interests.
In connection with the issuance of Book-Entry Interests to
DTC, the Book-Entry Depositary and the Issuer will sign Letters
of Representations with DTC, which will contain the DTC standard
riders for Rule 144A, Regulation S and ERISA-restricted
securities. Further, the Letters of Representations require the
Book-Entry Depositary to confirm to DTC the amount of the
Security (such term as used in this section shall have the
meaning set forth in the Letters of Representations) registered
in the name of its nominee, Cede & Co., on a daily or other
periodic basis in accordance with the provisions of the FAST
Balance Certificate Agreement currently in effect between The
Bank of New York and DTC. In such Letters of Representations,
the Book-Entry Depositary agrees that each such confirmation by
the Book-Entry Depositary shall be deemed to be a statement that
there are no liens, restrictions or adverse claims of the Issuer
to which the Security is or may be subject. Within the context
of the Letters of Representations, and as such terms are used in
the Letters of Representations, the Issuer confirms that such
statement, at the date hereof, is, and at the time of each such
confirmation will be, true and will promptly notify the Book-
Entry Depositary if such statement should cease to be true.
ARTICLE IV
MISCELLANEOUS PROVISIONS
Section 4.01. Notices to Book-Entry Depositary or Issuer.
Any request, demand, authorization, direction, notice,
consent, or waiver or other document provided or permitted by
this Agreement to be made upon, given or furnished to, or filed
with, the Book-Entry Depositary by DTC, by the Trustee or the
Issuer or the Guarantor shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing and personally delivered or
mailed, first-class postage prepaid, to the Book-Entry Depositary
at its Corporate Trust Office, Attention: Corporate Trust
Division, Corporate Finance Group, or at any other address
previously furnished in writing by the Book-Entry Depositary to
DTC, the Trustee, the Guarantor and the Issuer, or the Issuer, by
the Book-Entry Depositary or by DTC shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally
delivered or mailed, first-class postage prepaid to TXU Eastern
Funding Company, ▇/▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, Attention: Treasurer or at any other address previously
furnished in writing to the Book-Entry Depositary by the Issuer.
Section 4.02. Notice to DTC; Waiver.
Where this Agreement provides for notice to DTC of any
event, such notice shall be sufficiently given (unless otherwise
herein expressly provided or as provided in the Letters of
Representations) if in writing and mailed, first-class postage
prepaid, to DTC at the address notified to the Book-Entry
Depositary, in each case not later than the latest date, and not
earlier than the earliest date, prescribed for the giving of such
notice. Where this Agreement provides for notice in any manner,
such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice
by DTC shall be filed with the Book-Entry Depositary, but such
filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service
or by reason of any other cause it shall be impracticable to give
such notice by mail, then such notification as shall be made with
the approval of the Book-Entry Depositary shall constitute a
sufficient notification for every purpose hereunder.
Section 4.03. Effect of Headings and Table of Contents.
The Article and Section headings herein are for convenience
only and shall not affect the construction hereof.
Section 4.04. Successors and Assigns.
All covenants and agreements in this Agreement and the
Senior Notes by the Issuer shall bind its successors and assigns,
whether so expressed or not.
Section 4.05. Separability Clause.
In case any provision in this Agreement or in the Senior
Notes shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions hereof
and thereof shall not in any way be affected or impaired thereby.
Section 4.06. Benefits of Agreement.
Nothing in this Agreement, the Senior Notes or the
Indenture, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder, any
benefits or any legal or equitable right, remedy or claim under
this Agreement, provided that DTC and the beneficial owners of
Interests shall be intended third-party beneficiaries of this
Agreement. DTC and beneficial owners from time to time of
Interests in the Book-Entry Interests shall be parties to this
Agreement and shall be bound by all of the terms and conditions
hereof and of the Indenture and the Senior Notes, by their
acceptance of delivery of the Interests or beneficial interests
therein.
Section 4.07. GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION
WOULD BE REQUIRED THEREBY.
Section 4.08. Jurisdiction.
(a) The Issuer agrees that any legal suit, action or
proceeding against the Issuer brought by the Book-Entry
Depositary arising out of or based upon this Agreement may be
instituted in any state or Federal court in the Borough of
Manhattan, The City of New York, and waives any objection which
it may now or hereafter have to the laying of venue of any such
proceeding and, until the satisfaction and discharge of this
Agreement pursuant to Section 4.11 hereof, irrevocably submits to
the nonexclusive jurisdiction of such courts in any suit, action
or proceeding.
(b) The Issuer has appointed ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP at ▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its authorized
agent (the "Authorized Agent") upon whom process may be served in
any legal suit, action or proceeding arising out of or based upon
this Agreement which may be instituted in the Supreme Court of
New York, New York County or the United States District Court for
the Southern District of New York by DTC or the Book-Entry
Depositary, and expressly accepts the nonexclusive jurisdiction
of any such court in respect of any such action. Such
appointment shall be irrevocable. Service of process upon the
Authorized Agent shall be deemed, in every respect, effective
service of process upon the Issuer. Notwithstanding the
foregoing, any action based on this Agreement may be instituted
by the Book-Entry Depositary in any competent court in England or
Wales.
(c) To the extent that the Issuer may in any jurisdiction
claim for itself or its assets immunity (to the extent such
immunity may now or hereafter exist, whether on the grounds of
sovereign immunity or otherwise) from suit, execution, attachment
(whether in aid of execution, before judgment or otherwise) or
other legal process (whether through service or notice or
otherwise), and to the extent that in any such jurisdiction there
may be attributed to itself or its assets such immunity (whether
or not claimed), the Issuer irrevocably agrees with respect to
any matter arising under this Deposit Agreement for the benefit
of the Registered Holder from time to time of the Book-Entry
Interests, not to claim, and irrevocably waives, such immunity to
the full extent permitted by the laws of such jurisdiction.
Section 4.09. Counterparts.
This Agreement may be executed in any number of counterparts
by the parties hereto on separate counterparts, each of which,
when so executed and delivered, shall be deemed an original, but
all such counterparts shall together constitute one and the same
instrument.
Section 4.10. Inspection of Agreement.
A copy of this Agreement shall be available at all
reasonable times during normal business hours at the Corporate
Trust Office of the Book-Entry Depositary for inspection by DTC.
Section 4.11. Satisfaction and Discharge.
This Agreement upon Issuer Order shall cease to be of
further effect, and the Book-Entry Depositary, at the expense of
the Issuer shall execute proper instruments acknowledging
satisfaction and discharge of this Agreement, when (i) either (a)
the Indenture has been satisfied and discharged pursuant to the
provisions thereof or (b) Certificated Registered Senior Notes
have been issued and all of the Global Senior Notes have been
canceled in accordance with the provisions of Section 2.07 and
the Indenture, (ii) the Issuer has paid or caused to be paid all
sums payable hereunder by the Issuer and (iii) the Issuer has
delivered to the Book-Entry Depositary an officer's certificate
and an Opinion of Counsel, stating that all conditions precedent
herein provided relating to the satisfaction and discharge of
this Agreement have been complied with.
Section 4.12. Amendments.
The Issuer and the Book-Entry Depositary may amend this
Agreement without the consent of DTC or beneficial owners of
Interests in the Senior Notes:
(a) to cure any formal defect, omission, inconsistency or
ambiguity herein;
(b) to add to the covenants and agreements of the Issuer or
the Book-Entry Depositary;
(c) to effect the assignment of the Book-Entry Depositary's
rights and duties to a qualified successor as provided herein;
(d) to comply with any requirements of the Securities Act,
the Exchange Act, the Investment Company Act of 1940, as amended,
the Trust Indenture Act, or any other applicable securities laws;
(e) to modify this Agreement in connection with an
amendment to the Indenture that does not require the consent of
DTC; or
(f) to modify, alter, amend or supplement this Agreement in
any other respect not inconsistent with this Agreement which, in
the opinion of counsel acceptable to the Issuer, is not
materially adverse to DTC or the beneficial owners of Interests.
The Issuer and the Book-Entry Depositary, with the consent
of DTC, can make such changes as are necessary to effect and
implement a substitution of a successor depositary for DTC.
Except as set forth in this Section 4.12, no amendment which
materially adversely affects DTC or beneficial owners of
Interests may be made to this Agreement without the consent of
DTC or such beneficial owner.
Section 4.13. Book-Entry Depositary To Sign Amendments.
The Book-Entry Depositary shall sign any amendment
authorized pursuant to Section 4.12 hereof if the amendment does
not materially adversely affect the rights, duties, liabilities
or immunities of the Book-Entry Depositary. If it does, the
Book-Entry Depositary may, but need not sign it.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the date first written above.
TXU EASTERN FUNDING COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Attorney
TXU EASTERN FUNDING COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Director
THE BANK OF NEW YORK,
as Book-Entry Depositary
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
EXHIBIT A
[CERTIFICATE OF TRANSFER]
TXU EASTERN FUNDING COMPANY
. % NOTES DUE .
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
[ ]
-----------------------------------
Name and address of assignee
must be printed or typewritten.
$
---------------------------------------------------------------
principal amount of beneficial interest in the referred Security
of the Company and does hereby irrevocably constitute and appoint
-----------------------------------------------------------------
to transfer the said beneficial interest in such Security, with
full power of substitution in the premises.
The undersigned certifies that said beneficial interest in such
Security is being resold, pledged or otherwise transferred as
follows: (check one)
[ ] to the Company or the Guarantor;
[ ] to a Person whom the undersigned reasonably believes is a
Qualified Institutional Buyer within the meaning of Rule
144A under the Securities Act of 1933, as amended (the
"Securities Act") purchasing for its own account or for the
account of a Qualified Institutional Buyer to whom notice is
given that the resale, pledge or other transfer is being
made in reliance on Rule 144A;
[ ] in an offshore transaction in accordance with Rule 904 of
Regulation S under the Securities Act;
[ ] to an institution that is an "accredited investor" as
defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act that is acquiring said beneficial interest in
such Security for investment purposes and not for
distribution (attach a copy of an Accredited Investor Letter
in the form provided by the Company or the Trustee signed by
an authorized officer of the transferee);
[ ] as otherwise permitted by the non-registration legend; or
[ ] as otherwise agreed by the Company or the Guarantor, as the
case may be, confirmed in writing to the Trustee, as
follows: [describe]
-----------------------------------------------------------------
-----------------------------------------------------------------
Dated:
------------------------ ------------------------------
EXHIBIT B
ACCREDITED INVESTOR LETTER
Ladies and Gentlemen:
In connection with our proposed purchase of a beneficial
interest in the % Senior Notes due (the "Senior
Notes") issued by TXU Eastern Funding Company ("Issuer") and
guaranteed by TXU Eastern Holdings Limited ("Guarantor") under an
Indenture dated as of May 1, 1999 among the Issuer, the Guarantor
and the Bank of New York, as trustee ("Trustee"), we confirm and
certify that:
1. We have received a copy of the Offering
Memorandum (the "Offering Memorandum") relating to the
Senior Notes and such other information as we deem necessary
in order to make our investment decision. We acknowledge
that we have read and agree to the matters stated under the
caption NOTICE TO INVESTORS in such Offering Memorandum, and
the restrictions on duplication or circulation of, or
disclosure relating to, such Offering Memorandum.
2. We understand that any subsequent transfer of
beneficial interests in the Senior Notes is subject to
certain restrictions and conditions set forth in the
Indenture relating to Senior Notes (the "Indenture") and
that any subsequent transfer of beneficial interests in the
Senior Notes is subject to certain restrictions and
conditions set forth under NOTICE TO INVESTORS in the
Offering Memorandum, and the undersigned agrees to be bound
by, and not to resell, pledge or otherwise transfer
beneficial interests in the Senior Notes except in
compliance with such restrictions and conditions and the US
Securities Act of 1933, as amended ("Securities Act").
3. We understand that the offer and sale of
beneficial interests in the Senior Notes have not been
registered under the Securities Act, and that beneficial
interests in the Senior Notes may not be offered or sold
except as permitted in the following sentence. We agree, on
our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we sell any
beneficial interests in Senior Notes, we will do so only (A)
to the Issuer or Guarantor, (B) in accordance with Rule 144A
under the Securities Act to a person whom we reasonably
believe is a "qualified institutional buyer" (as defined
therein), (C) outside the United States in accordance with
Rule 904 of Regulation S under the Securities Act, (D)
pursuant to the exemption from registration provided by Rule
144 under the Securities Act (if available), or (E) pursuant
to an effective registration statement under the Securities
Act, and we further agree to provide to any person
purchasing any of the Senior Notes from us a notice advising
such purchaser that resales of beneficial interests in the
Senior Notes are restricted as stated herein.
4. We understand that, on any proposed resale of any
beneficial interests in Senior Notes pursuant to Rule 144 or
Regulation S under the Securities Act, we will be required
to furnish to the Trustee, Guarantor and Issuer such
certifications, opinion of counsel or other information as
the Trustee, Guarantor and Issuer may reasonably require to
confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Senior Notes
in which we purchase a beneficial interest will bear a
legend to the foregoing effect.
5. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act) and have such knowledge and
experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment
in the beneficial interests in Senior Notes, and we and any
accounts for which are acting are each able to bear the
economic risk of our or its investment.
6. We are acquiring the beneficial interests in
Senior Notes purchased by us for our own account or for one
or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole
investment discretion for investment purposes and not for
distribution in violation of the Securities Act.
7. No part of the funds to be used to purchase the
beneficial interests in Senior Notes to be purchased by us
constitutes assets which are directly or indirectly the
assets of any employee benefit plan such that the use of
such assets constitutes a non-exempt prohibited transaction
under the US Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or the US Internal Revenue Code
of 1986, as amended. As used in this paragraph, the term
"employee benefit plan" shall have the meaning assigned to
such terms in Section 3 of ERISA.
You, the Issuer, the Guarantor and the Trustee are entitled
to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with
respect to the matters covered hereby.
Very truly yours,
By:
---------------------------
Name:
Title: