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EXHIBIT 4.4
Draft
8/7/98
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ENRON INTERNATIONAL CPO, L.P.,
as Issuer,
ENRON INTERNATIONAL CPO, INC.,
as Co-Issuer,
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Trustee
[NAME OF LIQUIDITY FACILITY AGENT],
as Liquidity Facility Agent
BACKUP FACILITY AGENTS
from time to time party hereto
and
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Collateral Agent
COMMON AGREEMENT
Dated as of __________, 1998
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TABLE OF CONTENTS
Page
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RECITALS..........................................................................................................1
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1. Definitions.........................................................................................2
SECTION 1.2. Rules of Interpretation.............................................................................2
SECTION 1.3. Form of Documents Delivered to Collateral Agent or the Representatives..............................2
SECTION 1.4. Notices.............................................................................................2
SECTION 1.5. Execution in Counterparts...........................................................................4
SECTION 1.6. Effect of Heading and Table of Contents.............................................................4
SECTION 1.7. Successors and Assigns..............................................................................4
SECTION 1.8. Further Assurances..................................................................................4
SECTION 1.9. Delay and Waiver....................................................................................4
SECTION 1.10. Waiver of Jury Trial...............................................................................5
SECTION 1.11. Severability Clause................................................................................5
SECTION 1.12. Benefits of Common Agreement.......................................................................5
SECTION 1.13. Subject to Intercreditor Agreement.................................................................5
SECTION 1.14. Amendments.........................................................................................6
SECTION 1.15. Governing Law......................................................................................6
SECTION 1.16. Entire Agreement...................................................................................6
SECTION 1.17. Limitation on Liability............................................................................6
SECTION 1.18. Reinstatement......................................................................................6
SECTION 1.19. No Partnership, Etc................................................................................6
SECTION 1.20. No Petition........................................................................................6
SECTION 1.21. Costs and Expenses.................................................................................7
SECTION 1.22. Indemnities........................................................................................7
SECTION 1.23. Submission to Jurisdiction.........................................................................7
SECTION 1.24. Additional Parties.................................................................................8
ARTICLE 2
PORTFOLIO ACQUISITION
SECTION 2.1. Project Loans and Qualifying Criteria...............................................................8
SECTION 2.2. Temporary Investment Portfolio.....................................................................11
SECTION 2.3. Program Manager....................................................................................11
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the Issuer.......................................................12
SECTION 3.2. Representations and Warranties of the Co-Issuer....................................................13
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ARTICLE 4
COVENANTS
SECTION 4.1. Existence of Issuers...............................................................................14
SECTION 4.2. Compliance with Laws...............................................................................14
SECTION 4.3. Maintenance of Books and Records...................................................................15
SECTION 4.4. Information........................................................................................15
SECTION 4.5. Program Manager Removal............................................................................15
SECTION 4.6. Performance of Obligations.........................................................................15
SECTION 4.7. Preservation of Collateral.........................................................................16
SECTION 4.8. Opinions as to Collateral..........................................................................16
SECTION 4.9. Notices............................................................................................17
SECTION 4.10. Noninterference; Etc..............................................................................17
SECTION 4.11. Negative Covenants................................................................................17
SECTION 4.12. Statement as to Compliance........................................................................20
SECTION 4.13. Issuers May Consolidate, Etc., Only on Certain Terms..............................................20
SECTION 4.14. Successor Substituted.............................................................................23
SECTION 4.15. No Other Business.................................................................................24
SECTION 4.16. Funding of Class I Interests of the Issuer........................................................24
SECTION 4.17. Ratings Review....................................................................................24
SECTION 4.18. Tax Returns.......................................................................................24
SECTION 4.19. Financial Statements..............................................................................24
SECTION 4.20. Pledge of Interests in Intermediate Funding Entities..............................................25
SECTION 4.21. Utilization of Amounts Available under Project Borrower
Debt Service Reserve Account...................................................................25
ARTICLE 5
EVENTS OF DEFAULT AND REMEDIES
SECTION 5.1. Events of Default..................................................................................25
SECTION 5.2. Remedies...........................................................................................27
ARTICLE 6
ACCOUNTINGS; REPORTS
SECTION 6.1. Accountings........................................................................................27
SECTION 6.2. Reports by Independent Accountants.................................................................31
SECTION 6.3. Reports by Issuers.................................................................................31
ARTICLE 7
CALCULATIONS
SECTION 7.1. Assumptions as to Project Loans; Etc...............................................................32
ARTICLE 8
CONDITIONS PRECEDENT
SECTION 8.l. General Provisions.................................................................................33
SECTION 8.2. Additional Conditions..............................................................................35
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ARTICLE 9
HEDGING AGREEMENTS; BACKUP FACILITY LOAN AGREEMENTS; LIQUIDITY
FACILITY LOAN AGREEMENT
SECTION 9.1. Hedging Agreements.................................................................................35
SECTION 9.3. Increase in the Commitments under the Liquidity Facility Loan Agreement............................36
ARTICLE 10
REPAYMENTS AND REDEMPTIONS
SECTION 10.1. General Terms.....................................................................................37
SECTION 10.2. Redemption at the Option of the Issuers; Election to Redeem.......................................37
SECTION 10.3. Mandatory Redemption..............................................................................38
SECTION 10.4. Pro Rata Application..............................................................................40
ARTICLE 11
LIMITED RECOURSE LIABILITY OF THE ISSUERS
SECTION 11.1. Limited Recourse Liability........................................................................40
ARTICLE 12
PROVISIONS REGARDING THE ISSUERS
SECTION 12.1. Limitation on Benefit of Provisions regarding the Issuers.........................................41
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SCHEDULES, EXHIBITS, APPENDICES AND ANNEXES
APPENDIX A Definitions
APPENDIX B Summary of Principal Terms and Conditions of Backup Facility
Loan Agreement
EXHIBIT A Form of Guaranty regarding Waiver of Certain Project Loan
Criteria
EXHIBIT B Form of Opinion of Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
EXHIBIT C Form of Opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇
EXHIBIT D Form of Opinion of General Counsel to Enron
EXHIBIT E Form of Opinion of Counsel pursuant to Section 4.8
EXHIBIT F Form of Designation Letter
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THIS COMMON AGREEMENT (this "Agreement") dated as of
_________, 1998, is by and among ENRON INTERNATIONAL CPO, L.P., a limited
partnership organized under the laws of the State of Delaware (the "Issuer"),
ENRON INTERNATIONAL CPO, INC., a corporation organized under the laws of the
State of Delaware (the "Co-Issuer" and together with the Issuer, the "Issuers"),
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, as trustee (in such capacity, the
"Trustee") for the Noteholders under the Indenture dated as of _________, 1998
among the Issuers and the Trustee, [NAME OF LIQUIDITY FACILITY AGENT], acting on
behalf of itself and as agent for the other Liquidity Lenders (in such capacity,
the "Liquidity Facility Agent"), the Backup Facility Agents from time to time
made party hereto pursuant to Section 1.24 hereof and CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION, as collateral agent for the Secured Parties (in such
capacity, the "Collateral Agent").
W I T N E S S E T H:
WHEREAS, the Issuers may issue, from time to time, their
Class A Senior Notes due 2018, Class B Senior Subordinated Notes due 2018, and
Class C [___]% Subordinated Notes due 2018, in each case pursuant to the
Indenture;
WHEREAS, the Issuer is, simultaneously with the execution
hereof, entering into the Liquidity Facility Loan Agreement with the Liquidity
Lenders;
WHEREAS, the Issuer may, subsequent to the date hereof, enter
into one or more Backup Facilities with the Backup Lenders;
WHEREAS, it is a condition precedent to the issuance of the
Notes under the Indenture and to the effectiveness of the Liquidity Facility and
the Backup Facility that this Agreement be executed and delivered by each of the
parties hereto;
WHEREAS, the Issuers, the Representatives and the Collateral
Agent are simultaneously with the execution hereof entering into the
Intercreditor Agreement which sets forth, among other things, certain
intercreditor provisions, including the method of voting and decision making for
the Secured Parties, the arrangements applicable to joint consultation and
actions in respect of approval rights and waivers and the limitations on rights
of enforcement upon default;
WHEREAS, the Issuers and the Collateral Agent are
simultaneously with the execution hereof entering into the Security Agreement
pursuant to which the Issuer will grant to the Collateral Agent for the benefit
of the Secured Parties, a first priority security interest in and to the
Collateral and which sets forth, among other things, provisions authorizing and
directing the Collateral Agent to establish certain accounts for the purpose of
collecting and distributing Collateral Proceeds;
NOW, THEREFORE, in consideration of the foregoing premises and
the covenants and agreements contained herein and in the other Financing
Documents, the parties hereby agree as follows:
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ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1. Definitions. For all purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise requires,
capitalized terms used in this Agreement, its schedules and its exhibits have
the meanings given in Appendix A.
SECTION 1.2. Rules of Interpretation. Except as otherwise
expressly provided herein, the rules of interpretation set forth in Appendix A
hereto shall apply to this Agreement.
SECTION 1.3. Form of Documents Delivered to Collateral Agent
or the Representatives. In any case where several matters are required to be
certified by or covered by an opinion of any specified Person, it is not
necessary that all such matters be certified by or covered by the opinion of
only one such Person, or that they be so certified by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Officer of the Issuer, the
Co-Issuer or the Program Manager may be based, insofar as it relates to legal
matters, upon a certificate or opinion of, or representations by, counsel,
unless such Officer knows or has reason to believe that the certificate or
opinion or representations with respect to the matters upon which his or her
certificate or opinion is based are erroneous or contain any material omissions.
Any such certificate or opinion of counsel may be based, insofar as it relates
to factual matters, upon a certificate or opinion of, or representations by, an
Officer or Officers of the Issuer, the Co-Issuer or the Program Manager, stating
that the information with respect to such factual matters is in the possession
of the Issuer, the Co-Issuer or the Program Manager (as the case may be), unless
such counsel knows or in the exercise of reasonable care should know that the
certificate or opinion or representations with respect to such matters are
erroneous or contain any material omissions.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Agreement or any other Financing Document, they
may, but need not, be consolidated and form one instrument.
SECTION 1.4. Notices. Any communications between the parties
hereto or notices provided herein to be given shall be given to the following
addresses:
If to the Issuer:
Address:
-------------------------
Attention:
-----------------------
Telephone:
-----------------------
Telecopy:
-----------------------
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with a copy to the Program Manager:
Address:
-------------------------
Attention:
-----------------------
Telephone:
-----------------------
Telecopy:
-----------------------
If to the Co-Issuer:
Address:
-------------------------
Attention:
-----------------------
Telephone:
-----------------------
Telecopy:
-----------------------
with a copy to the Program Manager:
Address:
-------------------------
Attention:
-----------------------
Telephone:
-----------------------
Telecopy:
-----------------------
If to the Trustee:
Address: ▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Global Trust Services
--Enron International CPO, L.P.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
If to the Liquidity Facility Agent:
Address:
-------------------------
Attention:
-----------------------
Telephone:
-----------------------
Telecopy:
-----------------------
If to the Backup Facility Agent:
As specified in the Designation Letter delivered
pursuant to Section 1.24 hereof.
If to the Collateral Agent:
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Address: ▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Global Trust Services
--Enron International CPO, L.P.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
or to such other addresses as to which any such party may specify to each of the
other parties hereto in the manner set forth below. All notices or other
communications required or permitted to be given hereunder shall be in writing
and shall be considered as properly given (a) if delivered in person, (b) if
sent by overnight delivery service, (c) in the event overnight delivery services
are not readily available, if mailed by first class mail, postage prepaid,
registered or certified with return receipt requested or (d) if sent by prepaid
telex, or by telecopy with correct answer back received. Notice so given shall
be effective upon receipt by the addressee, except that any communication or
notice so transmitted by telecopy or other direct written electronic means shall
be deemed to have been validly and effectively given on the day (if a Business
Day and, if not, on the next following Business Day) on which it is validly
transmitted if transmitted before 4:00 p.m., recipient's time, and if
transmitted after that time, on the next following Business Day; provided,
however, that if any notice is tendered to an addressee and the delivery thereof
is refused by such addressee, such notice shall be effective upon such tender.
Any party hereto shall have the right to change its address for notice hereunder
to any other location by giving no less than 20 days' notice to the other
parties in the manner set forth hereinabove.
SECTION 1.5. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one of the same agreement.
SECTION 1.6. Effect of Heading and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.7. Successors and Assigns. All covenants and
agreements in this Agreement by any party hereto shall bind and, to the extent
permitted hereby, shall be enforceable against its successors and assigns,
whether so expressed or not. Unless expressly provided in Section 4.13 or 4.14
hereof, neither the Issuer nor the Co-Issuer may assign or otherwise transfer
any of its rights or obligations under this Agreement.
SECTION 1.8. Further Assurances. The Issuers shall fully
cooperate with the Collateral Agent and the Representatives, and perform all
additional acts reasonably requested by any such Person to effect the purposes
of the Financing Documents, including, without limitation, enabling the
Collateral Agent to exercise and enforce its rights under the Security
Documents.
SECTION 1.9. Delay and Waiver. No delay or omission to
exercise any right, power or remedy accruing upon the occurrence of any Event of
Default or any other breach or default of the Issuers under this Agreement or
any other Financing Document shall impair any
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such right, power or remedy of the Lenders, the Collateral Agent or the
Representatives nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or in any similar breach or default
thereafter occurring, nor shall any single or partial exercise by any such party
of any right, power or remedy under this Agreement or any other Financing
Document preclude any other or future exercise thereof or the exercise of any
other right, power or remedy, nor shall any waiver of any single Event of
Default or other breach or default be deemed a waiver of any other Event of
Default or other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
Lender, the Collateral Agent or any Representative of any Event of Default or
other breach or default under this Agreement or any other Financing Document or
any waiver on the part of any Lender, the Collateral Agent or any
Representative, of any provision or condition of this Agreement or any other
Financing Document, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or any other Financing Document or by law or otherwise afforded to any
Lender, the Collateral Agent or any Representative, shall be cumulative and not
alternative.
SECTION 1.10. Waiver of Jury Trial. TO THE EXTENT PERMITTED
BY APPLICABLE LAW, EACH OF THE PARTIES TO THIS AGREEMENT HEREBY KNOWINGLY,
VOLUNTARILY, INTENTIONALLY AND IRREVOCABLY WAIVES ANY RIGHTS IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION, PROCEEDING OR COUNTERCLAIM BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY
OTHER FINANCING DOCUMENT TO WHICH SUCH PERSON IS A PARTY, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF
THE OTHER PARTIES HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR EACH OF
THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT AND ANY OTHER FINANCING DOCUMENT
TO WHICH IT IS A PARTY.
SECTION 1.11. Severability Clause. If any provision in this
Agreement or in any other Financing Document is invalid, illegal or
unenforceable in any jurisdiction, then, to the fullest extent permitted by
applicable law, (i) the other provisions hereof or of any such other Financing
Document shall remain in full force and effect in such jurisdiction, (ii) the
invalidity, illegality or unenforceability of any provision hereof or of any
other Financing Document in any jurisdiction shall not affect the validity,
legality or enforceability of such provision in any other jurisdiction and (iii)
the parties hereto shall enter into good faith negotiations to replace the
invalid, illegal or unenforceable provision.
SECTION 1.12. Benefits of Common Agreement. Nothing in this
Agreement or any other Financing Document, expressed or implied, shall give to
any Person, other than the parties hereto and thereto and their successors
hereunder and thereunder and the Lenders, any benefit or any legal or equitable
right, remedy or claim under this Agreement.
SECTION 1.13. Subject to Intercreditor Agreement. The rights
of the Lenders under this Agreement and each other Financing Document shall be
subject to the terms and provisions of the Intercreditor Agreement.
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SECTION 1.14. Amendments. Except as otherwise expressly
provided in this Agreement or the Intercreditor Agreement, any provision of this
Agreement may be amended or modified only by an instrument in writing signed by
the Issuers and the Collateral Agent.
SECTION 1.15. Governing Law. THIS AGREEMENT AND THE RIGHTS
AND DUTIES OF THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE
PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW.
SECTION 1.16. Entire Agreement. This Agreement and any
agreement, document or instrument attached hereto or referred to herein,
including (without limitation) all other Financing Documents, integrate all the
terms and conditions mentioned herein or incidental hereto and supersede all
oral negotiations and prior writings with respect to the subject matter hereof.
SECTION 1.17. Limitation on Liability. No claim shall be made
by the Issuers or any of their Affiliates against any of the Representatives,
the Collateral Agent, the Noteholders or any of their Affiliates, directors,
employees, attorneys or agents for any special, indirect, consequential or
punitive damages (whether or not the claim therefor is based on contract, tort
or duty imposed by law), in connection with, arising out of or in any way
related to the transactions contemplated by this Agreement or the other
Financing Documents or any act or omission or event occurring in connection
therewith; and the Issuers hereby waive, release and agree not to ▇▇▇ upon any
such claim for any such damages, whether or not known or suspected to exist in
its favor.
SECTION 1.18. Reinstatement. This Agreement shall continue to
be effective or be reinstated, as the case may be, if at any time payment and
performance of the Issuers' obligations under any Financing Document, or any
part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or
must otherwise be restored or returned by any Representative, the Collateral
Agent or the Noteholders. If any payment or any part thereof is so rescinded,
reduced, restored or returned, such obligations shall be reinstated and deemed
reduced only by such amount paid and not so rescinded, reduced, restored or
returned.
SECTION 1.19. No Partnership, Etc. The Secured Parties and the
Issuers intend that the relationship between them shall be solely that of
creditor and debtor. Nothing contained in this Agreement or in any other
Financing Document shall be deemed or construed to create a partnership,
tenancy-in-common, joint tenancy, joint venture or co-ownership by or between
the Secured Parties and the Issuers or by the Secured Parties and any other
Person.
SECTION 1.20. No Petition. Each party hereto hereby covenants
and agrees that, prior to the date which is one year and one day after the
payment in full of all amounts payable in respect of the Financing Documents, it
will not institute against, or join any other Person in instituting against, the
Issuer or the Co-Issuer, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings, or other proceedings under any federal or state
bankruptcy or similar law. This Section 1.20 shall survive any termination of
this Agreement.
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SECTION 1.21. Costs and Expenses. The Issuers shall pay the
legal and other professional fees and costs of any consultants and advisors to
the Representatives and the Collateral Agent and the travel expenses and other
out-of-pocket costs, all of which shall be reasonably incurred by the
Representatives and the Collateral Agent and such consultants and advisors in
connection with the preparation, negotiation, execution and delivery, and, where
appropriate, registration, of this Agreement and any other Financing Documents
(and all matters incidental thereto), the administration of the transactions
contemplated by this Agreement and any other Financing Documents (including,
without limitation, the monitoring of this Agreement and any other Financing
Documents), and the preservation or enforcement of any of their respective
rights or in connection with any amendments, waivers or consents or other
implementation and administrative actions required under this Agreement and any
other Financing Documents. Provided that no Event of Default has occurred and is
continuing, the Representatives and the Collateral Agent will not hire any
consultants or advisors whose fees and costs shall be borne by the Issuers
without the prior written consent of the Issuers on the terms and conditions of
such fees and expenses, which consent shall not be unreasonably withheld or
delayed.
SECTION 1.22. Indemnities. The Issuer agrees, to the fullest
extent permitted by law, to indemnify and hold harmless each Representative and
the Collateral Agent and each of their respective directors, officers, employees
and agents (each, an "Indemnitee") from and against any and all claims, damages,
liabilities and expenses (including, without limitation, reasonable fees and
disbursements of counsel and claims, damages, liabilities and expenses) for
which any of them may become liable or which may be incurred by or asserted
against such Indemnitee (other than by such Indemnitee or any of their
respective successors or assigns), in each case in connection with or arising
out of or by reason of any investigation, litigation, or proceeding, whether or
not such Indemnitee is a party thereto, arising out of, related to or in
connection with this Agreement or any other Financing Document (EXPRESSLY
INCLUDING ANY SUCH CLAIM, DAMAGES, LIABILITY OR EXPENSE, ATTRIBUTABLE TO THE
ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH INDEMNITEE, BUT EXCLUDING ANY
SUCH CLAIM, DAMAGE, LIABILITY OR EXPENSE ATTRIBUTABLE TO THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF SUCH INDEMNITEE). IT IS THE INTENT OF THE PARTIES HERETO
THAT EACH INDEMNITEE, SHALL, TO THE EXTENT PROVIDED IN THIS SECTION 1.22, BE
INDEMNIFIED FOR THEIR OWN ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE.
SECTION 1.23. Submission to Jurisdiction.
(a) Except as set forth in subsection (b), the Issuers hereby
irrevocably submit to the non-exclusive jurisdiction of any New York State or
federal court sitting in the Borough of Manhattan in The City of New York in any
action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby, and the Issuers hereby irrevocably agree that
all claims in respect of such action or proceeding may be heard and determined
in such New York State or federal court. The Issuers hereby irrevocably waive,
to the fullest extent that they may legally do so, any defense which they now or
hereafter have to the laying of the venue of any such proceeding brought in such
court and any claim that any such proceeding brought in such court has been
brought in an inconvenient forum and to the maintenance of such action or
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proceeding. The Issuers irrevocably consent to the service of any and all
process in any action or proceeding by the mailing or delivery of copies of such
process to it at the address set forth in Section 1.4. The Issuers agree 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. Notwithstanding the foregoing, no document filed, assertion
made, or issue adjudicated in any court or other arbitral proceeding shall have
a collateral, judicial, or other estoppel or res judicata effect on any arbitral
proceeding that is subject to Section 11.11 of the Management Agreement.
(b) The foregoing submission to jurisdiction is not intended
to and shall not apply to any claim, controversy, issue or accounting bearing on
Article 9 of the Enron Support Agreement except insofar as such claim,
controversy, issue or accounting arises in connection with a motion to confirm,
vacate, or modify an arbitration award rendered pursuant to Section 11.11 of the
Management Agreement.
SECTION 1.24. Additional Parties
In the event the Issuer enters into one or more Backup
Facilities after the Closing Date, each Person acting as Backup Facility Agent
for such Backup Facility is required to become a party to this Agreement on
behalf of the Backup Lenders for whom such Person is acting by executing and
delivering to the Issuer and the Collateral Agent a Designation Letter
substantially in the form set forth in Exhibit F hereto. Each Backup Facility
Agent made party to this Agreement pursuant to this section shall be bound by,
and be subject, to the terms and conditions hereof and the covenants,
stipulations and agreements contained herein.
ARTICLE 2
PORTFOLIO ACQUISITION
SECTION 2.1. Project Loans and Qualifying Criteria.
(a) (i) The Issuer may, from time to time during the
Investment Period, make Project Loans to a Project Borrower or acquire Project
Loans of a Project Borrower, in each case in respect of Eligible Projects which
satisfy the Qualifying Criteria as of the Financial Closing Date therefor. The
Issuer shall not initially fund any Project Loan, unless (as evidenced by an
Officer's certificate of the Program Manager delivered to the Collateral Agent
and the Representatives) each of the Qualifying Criteria is satisfied with
respect to such Project Loan on the Financial Closing Date for such Project
Loan, after giving effect to the support provided, if any, by Enron, an Enron
Credit Counterparty or an Acceptable Credit Provider, pursuant to the terms of
the Enron Support Agreement and/or as contemplated by the final proviso to the
definition of Project Loan Criteria in Appendix A hereto.
The Issuer shall not enter into a Commitment unless such
Commitment is subject to cancellation in the event any of the Qualifying
Criteria is not satisfied as of the Financial Closing Date for the related
Project Loan. Initial funding under all Project Loans shall occur no later than
the Scheduled Investment Termination Date.
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(ii) Without limiting the generality of the foregoing clause
(a)(i), the Issuer may make loans in respect of Eligible Projects through one or
more Intermediate Funding Entities so long as:
(A) the initial funding to an Intermediate Funding Entity by
the Issuer, or by an Intermediate Funding Entity to
another Intermediate Funding Entity, occurs on or after
the Financial Closing Date for the related Project Loan;
(B) in the case of an Intermediate Funding Entity that is
wholly-owned, directly or indirectly, by the Issuer, the
ownership interests of such Intermediate Funding Entity
are pledged to the Collateral Agent;
(C) any operating expenses and tax liabilities of an
Intermediate Funding Entity are paid first, from fees,
if any, received by such Intermediate Funding Entity in
connection with the related Intermediate Funding Loan,
and second, from interest payments received by such
Intermediate Funding Entity from the related Project
Borrower or Intermediate Funding Entity, as the case may
be, and third, from principal payments received by such
Intermediate Funding Entity from the related Project
Loan or Intermediate Funding Loan, as the case may be;
(D) each Rating Agency is provided with reasonable details
regarding the structure of the Intermediate Funding
Entities related to a Project Loan; and
(E) the Intermediate Funding Loan made by the Issuer to such
Intermediate Funding Entity and, to the extent
applicable, by one Intermediate Funding Entity to
another Intermediate Funding Entity, each satisfy the
following criteria:
(I) such Intermediate Funding Loan is secured by a
valid first priority perfected lien on the
relevant Intermediate Funding Entity's tangible
and intangible assets relating (directly or
indirectly) to a particular Project Loan (to the
extent such collateral security interest may be
perfected under applicable law) and in the case
of an Intermediate Funding Entity making loans
(directly or indirectly) in respect of more than
one Project Borrower, the obligations of such
Intermediate Funding Entity in respect of loans
advanced to it by the Issuer or by another
Intermediate Funding Entity are limited solely to
the tangible and intangible assets of such
Intermediate Funding Entity directly relating to
the relevant Project Loan;
(II) the notes evidencing the Project Loan, and to the
extent applicable, any Intermediate Funding Loan,
are pledged by the applicable Intermediate
Funding Entity to the Issuer (either directly or
indirectly through one or more Intermediate
Funding Entities) and,
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pursuant to the Security Agreement,
indirectly to the Collateral Agent;
(III) such Intermediate Funding Loan, if made by
the Issuer, is denominated in Dollars;
provided, however, that any other
Intermediate Funding Loan may be denominated
in currency other than Dollars if such loan
complies with the requirements of clause (1)
of the definition of "Project Loan Criteria"
set forth in Appendix A hereto;
(IV) on or prior to the Financial Closing Date of
such Intermediate Funding Loan, the Issuer
will have received satisfactory opinions of
Independent counsel (which counsel may rely,
to the extent customary, on opinions of
in-house counsel and assume the accuracy
thereof);
(V) payment provisions of such Intermediate
Funding Loan provide that such Intermediate
Funding Entity make principal and interest
(and any other) payments to the Issuer or
Intermediate Funding Entity (as applicable)
in amounts and under payment terms
substantially similar to (x) the amounts and
payment terms of the related Project Loan,
in the case of an Intermediate Funding Loan
made to an Intermediate Funding Entity
directly making a Project Loan or (y) the
amounts and payment terms of the related
Intermediate Funding Loan, in the case of an
Intermediate Funding Loan made to another
Intermediate Funding Entity; provided,
however, the amounts owing under the
Intermediate Funding Loan may be reduced
from the amounts payable under the related
Project Loan, in the case of foregoing
clause (x) and the related Intermediate
Funding Loan, in the case of foregoing
clause (y), to the extent, and only to the
extent, necessary to pay the operating
expenses and tax liabilities of such
Intermediate Funding Entity that is the
borrower of such Intermediate Funding Loan;
and
(VI) any event of default under the related
Project Loan will constitute an event of
default under such Intermediate Funding
Loan.
(iii) The provisions hereof or of any other Transaction
Document shall, as the context may reasonably permit or require, be construed to
reflect the intent of the foregoing provisions of this Section 2.1 to allow the
Issuer to make Project Loans indirectly to Project Borrowers through one or more
Intermediate Funding Entities. Without limiting the generality of the foregoing
sentence, references herein or in any other Transaction Document to any rights
or interests that the Issuer may have in or with respect to a Project Loan or a
Project Borrower shall, insofar as such rights or interests are derived through
one or more Intermediate Funding Entities and notwithstanding any provision of
any Transaction Document to the contrary, be deemed to be references to such
derivative and indirect rights or interests.
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(b) (i) Notwithstanding Section 2.1(a)(i) or any provision in
any Financing Document to the contrary, if, on any date after the Closing Date,
there shall be a transfer of the ownership of EI to a Person (the "Transferee")
as set forth in Section 14.8 of the Enron Support Agreement, then the Enron
Ownership Requirement shall be deemed satisfied so long as the requirements
therein are satisfied after (and the definitions of Enron Ownership Percentage
and Enron Ownership Requirement in said Appendix A shall be construed by)
substituting, in lieu of Enron or any Enron Affiliate (as relevant) for all
purposes thereof, the Transferee.
(ii) Upon receipt of prior notification by Enron of a proposed
Equity Disposition, the Issuer shall, as soon as practicable, but in no event
later than ten days following receipt of such notice, seek to confirm that the
Rating Condition would be satisfied based on the following assumptions (the
"Assumptions"): (A) the sale of the Project Loan for an amount equal to the
Disposition Amount therefor, (B) redemption or prepayment pursuant to Section
10.3(a)(iii) and (C) Enron Distributions are calculated pursuant to clause (c)
of the definition of Enron Distributions. If the Issuer obtains a confirmation
of the Rating Condition based on the Assumptions, the Issuer shall notify Enron
of such confirmation and the amount of Enron Distributions calculated pursuant
to clause (c) of the definition of Enron Distributions. Upon payment of the
Disposition Amount by Enron or its designee to the Issuer, (x) the Issuer shall
transfer, or cause to be transferred, such Project Loan to Enron or its
designee, (y) the Lien of the Security Agreement with respect to such Project
Loan shall be released in accordance with Section 2.6 of the Security Agreement
and (z) the Issuer shall effect a redemption pursuant to Section 10.3(a)(iii);
provided, however, the Issuer shall not effect such mandatory redemption (and no
such payment of the Disposition Amount shall be payable to the Issuer) in the
event such Project Loan is retained as Collateral by the Issuer upon the
approval of the Required Lenders.
If the Issuer fails to obtain a confirmation of the Rating
Condition based upon the Assumptions, (A) the Issuer shall notify Enron that the
Rating Condition has not been so confirmed, (B) the Issuer shall be required to
retain the Project Loan as Collateral, (C) Enron Distributions shall be
calculated pursuant to clause (c) of the definition of "Enron Distributions"
without adjustment pursuant to subclause (y) thereof and (D) no mandatory
redemption shall be effected (and no payment of the Disposition Amount shall be
payable to the Issuer) as a result of such Equity Disposition.
SECTION 2.2. Temporary Investment Portfolio. On or prior to
the Closing Date, the Issuer shall enter into a TIP Investment Management
Agreement pursuant to which ___________________ shall act as the initial TIP
Advisor in respect of the Temporary Investments. The TIP Investment Management
Agreement shall contain, among other things, the requirements and investment
guidelines regarding the Temporary Investments, including the Committed TIP
Investment Policies and the Uncommitted TIP Investment Policies.
SECTION 2.3. Program Manager.
(a) The Issuer hereby covenants with each party hereto and
each other Secured Party that until the Final Termination Date:
(i) the Issuer will engage the Program Manager to manage and
administer the Portfolio Assets in accordance with the provisions of
the Management Agreement; and
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(ii) the Issuer will not give any instructions to the Program
Manager in respect of its performance of the Management Agreement or
the sale, acquisition or disposition of Portfolio Assets in
contravention of the terms hereof or any other Financing Document.
(b) Each party hereto agrees that the Program Manager is
empowered and authorized to take any and all actions on behalf of the Issuer and
the Co-Issuer hereunder and under the other Financing Documents, subject to the
provisions of the Management Agreement, and each such party agrees that it will
accept any act or discretion on the part of the Program Manager as the act or
discretion of the Issuer and/or the Co-Issuer, as the case may be. Specifically
and without limiting the foregoing, each party hereto agrees, on its behalf and,
in the case of each Representative, on behalf of each Secured Party for whom
such Representative is acting, that any direct or indirect claim, counterclaim,
issue or accounting of such Person of any nature whatsoever against the Program
Manager arising out of or in connection with the Financing Documents, other than
in connection with a motion to confirm, modify or vacate an arbitration award,
shall be subject to Sections 2.02, 2.07 and 11.11 of the Management Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the Issuer. The
Issuer hereby represents and warrants to the Secured Parties as follows as of
the date hereof:
(a) Status. The Issuer is a limited partnership duly formed,
validly existing and in good standing under the laws of the State of
Delaware, has all requisite power and authority, and has all material
governmental licenses, authorizations, consents and approvals,
necessary to own its assets and carry on its business as now being or
as proposed to be conducted and is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes
such qualification necessary and where failure so to qualify would have
a Material Adverse Effect with respect to the Issuer.
(b) Powers. The Issuer has all necessary power and authority
to execute and deliver this Agreement and each Transaction Document to
which it is a party and to perform its obligations under this Agreement
and each such Transaction Document and has taken all necessary action
to authorize such execution, delivery and performance. This Agreement
and each Transaction Document to which the Issuer is a party has been
duly executed and delivered by the Issuer. This Agreement constitutes,
and each such Transaction Document when executed and delivered by the
Issuer shall constitute, the legal, valid and binding obligation of the
Issuer, enforceable against the Issuer in accordance with its
respective terms (subject to applicable bankruptcy, reorganization,
insolvency, moratorium or similar laws affecting creditors' rights
generally and subject, as to enforceability, to equitable principles of
general application (regardless of whether enforcement is sought in a
proceeding in equity or at law)).
(c) No Violation or Conflict. None of the execution and
delivery of this Agreement by the Issuer, the consummation by it of the
transactions contemplated herein and in the Transaction Documents and
compliance by it with the terms and provisions
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hereof and thereof will contravene or result in a breach of or require
any consent under the Partnership Agreement or the Certificate of
Limited Partnership of the Issuer, or any applicable law or regulation,
or any order, writ, injunction or decree of any court or governmental
authority or agency, or any agreement or instrument to which the Issuer
is a party or by which the Issuer is bound or to which the Issuer is
subject, or result in the creation or imposition of any Lien (except
for any Permitted Liens) upon any property of the Issuer, in any case
which could reasonably be expected to have a Material Adverse Effect.
(d) Consents. All governmental and other consents that are
required to have been obtained by the Issuer with respect to its
execution, delivery and performance of this Agreement and each
Transaction Document have been obtained and are in full force and
effect and all conditions of any such consents have been complied with.
(e) Absence of Litigation. There is not pending or, to its
knowledge, threatened against the Issuer, any action, suit or
proceeding at law or in equity or before any court, governmental body,
agency or official or any arbitrator which could reasonably be expected
to have a Material Adverse Effect.
(f) No Required Registration. The Issuer has not engaged in
any transaction in connection with this Agreement or the Transaction
Documents that would result in the violation of, or require
registration as an investment company under, the Investment Company Act
of 1940, as amended.
SECTION 3.2. Representations and Warranties of the Co-Issuer.
The Co-Issuer hereby represents and warrants to the Secured Parties as follows
as of the date hereof:
(a) Status. The Co-Issuer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware, has all requisite power and authority, and has all material
governmental licenses, authorizations, consents and approvals,
necessary to own its assets and carry on its business as now being or
proposed to be conducted and is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes
such qualification necessary and where failure so to qualify would have
a Material Adverse Effect with respect to the Co-Issuer.
(b) Powers. The Co-Issuer has all necessary corporate power
and authority to execute and deliver this Agreement and each
Transaction Document to which it is a party and to perform its
obligations under this Agreement and each such Transaction Document and
has taken all necessary corporate action to authorize such execution,
delivery and performance. This Agreement and each Transaction Document
to which the Co-Issuer is a party has been duly executed and delivered
by the Co-Issuer. This Agreement constitutes, and each such Transaction
Document when executed and delivered by the Co-Issuer shall constitute,
the legal, valid and binding obligation of the Co-Issuer, enforceable
against the Co-Issuer in accordance with its respective terms (subject
to applicable bankruptcy, reorganization, insolvency, moratorium or
similar laws affecting creditors' rights generally and subject, as to
enforceability, to equitable principles of general application
(regardless of whether enforcement is sought in a proceeding in equity
or at law)).
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(c) No Violation or Conflict. None of the execution and
delivery of this Agreement by the Co-Issuer, the consummation by it of
the transactions contemplated herein and in the Transaction Documents
and compliance by it with the terms and provisions hereof and thereof
will contravene or result in a breach of or require any consent under
the certificate of incorporation or bylaws of the Co-Issuer, or any
applicable law or regulation, or any order, writ, injunction or decree
of any court or governmental authority or agency, or any material
agreement or instrument to which the Co-Issuer is a party or by which
the Co-Issuer is bound or to which the Co-Issuer is subject, or result
in the creation or imposition of any Lien (except for any Permitted
Liens) upon any property of the Co-Issuer, in any case which could
reasonably be expected to have a Material Adverse Effect.
(d) Consents. All governmental and other consents that are
required to have been obtained by the Co-Issuer with respect to its
execution, delivery and performance of this Agreement and each
Transaction Document have been obtained and are in full force and
effect and all conditions of any such consents have been complied with.
(e) Absence of Litigation. There is not pending or, to its
knowledge, threatened against the Co-Issuer, any action, suit or
proceeding at law or in equity or before any court, governmental body,
agency or official or any arbitrator in which could reasonably be
expected to have a Material Adverse Effect.
(f) No Required Registration. The Co-Issuer has not engaged in
any transaction in connection with this Agreement or the Transaction
Documents that would result in the violation of, or require
registration as an investment company under, the Investment Company Act
of 1940, as amended.
ARTICLE 4
COVENANTS
Each of the Issuer and the Co-Issuer hereby covenants and
agrees (as applicable) with and for the benefit of the Collateral Agent, the
Representatives and each other Secured Party, that until the Final Termination
Date, and so long as the Collateral Agent, acting pursuant to the Intercreditor
Agreement, has not waived compliance in writing:
SECTION 4.1. Existence of Issuers. Each of the Issuer and the
Co-Issuer shall maintain in full force and effect its existence and rights as a
limited partnership organized under the laws of the State of Delaware, in the
case of the Issuer, and a corporation organized under the laws of the State of
Delaware, in the case of the Co-Issuer and shall comply with the provisions of
its respective organizational documents and shall obtain and preserve its
qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of the
Transaction Documents or Additional Transaction Documents or any of the
Collateral.
SECTION 4.2. Compliance with Laws. The Issuers will comply in
all material respects with applicable laws, rules, regulations, writs,
judgments, injunctions, decrees, awards
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and orders with respect to them, their businesses and their properties, except
where failure to so comply could not reasonably be expected to have a Material
Adverse Effect.
SECTION 4.3. Maintenance of Books and Records.
(a) The Issuers shall maintain and implement administrative
and operating procedures reasonably necessary in the performance of their
obligations hereunder and the Issuer shall keep and maintain at all times, or
cause to be kept and maintained at all times in its office located at
[___________________], all documents, books, records, accounts and other
information reasonably necessary for the performance of its obligations
hereunder.
(b) The Issuers shall, at any reasonable time and from time to
time after reasonable notice, permit the Collateral Agent or any Representative
or any representative thereof to examine the records and books of the Issuers
and to discuss the affairs, finances and accounts of each of the Issuers with
any of the Issuers' representatives, officers or directors.
SECTION 4.4. Information. The Issuers shall provide any
information regarding the condition or operations, financial or otherwise, of
either of the Issuers as the Collateral Agent or any Representative shall
reasonably request.
SECTION 4.5. Program Manager Removal. If an event specified
under Section 10.02(a) of the Management Agreement shall have occurred and
be continuing, the Issuers shall (i) terminate the Program Manager in accordance
with the provisions thereof upon the direction of the Collateral Agent acting on
behalf of the Required Lenders and (ii) appoint a Replacement Manager as
directed by the Collateral Agent acting on behalf the Required Lenders; provided
that if at any time the Senior Secured Obligations are outstanding, either (x)
the Collateral Agent on behalf of the Required Lenders fails to direct the
Issuers to terminate the rights and obligations of the Program Manager within 60
days following a Subordinate Event of Default or (y) in the case of a
termination following an Event of Default a Subordinate Event of Default, the
Collateral Agent on behalf of the Required Lenders fails to propose a
Replacement Manager within 120 days after directing the Issuers to terminate the
rights and obligations of the Program Manager, then a Majority of the Class B
Notes will be permitted to direct the Issuers to terminate the rights and
obligations of the Program Manager under the Agreement and propose a Replacement
Manager.
SECTION 4.6. Performance of Obligations.
(i) The Issuers shall not take any action, and will use their
reasonable best efforts not to permit any action to be taken by others, that
would release any Person from any of such Person's covenants or obligations
under any instrument included in the Collateral, except as otherwise permitted
hereunder or under any other Financing Document.
(ii) The Issuers may contract with other Persons, including
the Program Manager, for the performance of actions and obligations to be
performed by the Issuers hereunder. Notwithstanding any such arrangement, the
Issuers shall remain primarily liable with respect thereto.
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SECTION 4.7. Preservation of Collateral. Each of the Issuer
and the Co-Issuer shall from time to time execute and deliver all such
supplements and amendments hereto and to the other Financing Documents and all
such Financing Statements, continuation statements, instruments of further
assurance and other instruments, and shall take such other action as may be
necessary or advisable or desirable to secure the rights and remedies of the
Secured Parties hereunder and under the other Financing Documents and to:
(i) Grant more effectively all or any portion of the
Collateral;
(ii) maintain or preserve the Lien (and the priority thereof)
of the Security Agreement or any other Security Document or to carry
out more effectively the purposes thereof;
(iii) perfect, publish notice of or protect the validity of
any Grant made or to be made by the Security Agreement or any other
Security Document (including, without limitation, any and all actions
necessary or desirable as a result of changes in law or regulations);
(iv) preserve and defend title to the Collateral and the
rights therein of the Secured Parties in the Collateral against the
claims of all Persons and parties; or
(v) pay or cause to be paid any and all taxes levied or
assessed upon all or any part of the Collateral;
provided, that in the case of any third party consent relating to any
Additional Transaction Document with cumulative payments and receipts
less than or equal to $5 million, each of the Issuer and the Co-Issuer
shall be deemed to have satisfied this Section 4.7 (including clause
(iii) above) so long as the Issuers shall have used good faith
reasonable efforts to take such actions.
Each of the Issuer and the Co-Issuer hereby designates the
Collateral Agent its agent and attorney-in-fact to execute any Financing
Statement, continuation statement or other instrument required pursuant to this
Section 4.7.
SECTION 4.8. Opinions as to Collateral. On the Closing Date
and within 10 Business Days of each subsequent anniversary thereafter, the
Issuer shall furnish to each Representative, the Collateral Agent, each Hedge
Counterparty and each Rating Agency an Opinion of Counsel stating that, in the
opinion of such counsel, as of the date of such opinion, the Lien and security
interest created by the Security Agreement and the other Security Documents with
respect to the Collateral remains a valid and perfected first priority Lien;
provided, that such opinion need not address the perfection and priority of a
security interest in any Additional Transaction Document with cumulative
payments and receipts of less than or equal to $5 million and that no further
action (other than as specified in such opinion) needs to be taken (under the
law then in effect) to ensure the continued effectiveness and perfection of such
Lien over the next year (substantially in the form, in pertinent part, attached
as Exhibit B hereto, and which may include assumptions and qualifications
substantially similar to those set forth in Exhibit B hereto, as and to the
extent relevant).
The Issuers agree to comply in all material respects with all
requirements applicable to the Issuers set forth in any Opinion of Counsel
furnished pursuant to this Section
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4.8, including satisfaction of any condition identified in such Opinion as a
prerequisite for obtaining or maintaining a first priority perfected security
interest in any Collateral.
SECTION 4.9. Notices. In the event the Issuer acquires
knowledge of the occurrence of any Default, the Issuer shall immediately, and in
any event, within three Business Days, give notice thereof to the Collateral
Agent, each Representative and each Hedge Counterparty, which notice shall set
forth the details of such Default and the actions taken or proposed to be taken
in response thereto.
SECTION 4.10. Noninterference; Etc. The Issuer shall not (i)
waive or alter any of its material rights under the Assigned Documents without
the prior written consent of the Collateral Agent upon the written direction of
the Required Lenders; (ii) fail to pay any tax, assessment, charge or fee levied
or assessed against the Collateral, or to defend any action, if such failure to
pay or defend may adversely affect the priority or enforceability of the
Issuer's right, title or interest in and to the Collateral or the Collateral
Agent's Liens on, and security interests in, the Collateral; or (iii) take any
action, or fail to take any action, if such action or failure to take action
will interfere with the enforcement of any material rights under the Assigned
Documents.
SECTION 4.11. Negative Covenants.
(a) The Issuer shall not and the Co-Issuer, except with
respect to (xiv) below, shall not:
(i) sell, transfer, assign, exchange or otherwise dispose of,
or pledge, mortgage, hypothecate or otherwise encumber (by security
interest, Lien (statutory or otherwise), preference, priority or other
security agreement or preferential arrangement of any kind whatsoever
or otherwise) (or permit such to occur or suffer such to exist), any
part of the Collateral, except as expressly permitted by the terms of
the Financing Documents;
(ii) claim any credit on, make any deduction from, or dispute
the enforceability of, the payment of the principal or interest (or any
other amount) payable in respect of the Secured Obligations (other than
amounts withheld in accordance with the Code or other applicable law)
or assert any claim against any present or future Secured Party, by
reason of the payment of any taxes levied or assessed upon any part of
the Collateral;
(iii) except as expressly contemplated by this Agreement, the
Indenture, the Enron Support Agreement and the other Financing
Documents, (A) incur or assume or guarantee any indebtedness or any
contingent obligations or (B) issue any additional securities;
(iv) (A) permit the validity or effectiveness of the Security
Documents or any Grant thereunder to be impaired, or permit the Lien
created by the Security Documents to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be
released from any covenants or obligations with respect to the
Financing Documents in contravention of any Financing Document, (B)
permit any Lien (other than Permitted Liens) to be created on or extend
to or otherwise arise upon or burden the
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Collateral or any part thereof, any interest therein or the proceeds
thereof, or (C) take any action that would permit the Liens created by
the Security Documents not to constitute valid first priority security
interests in the Collateral (subject only to Permitted Liens);
(v) make or incur any capital expenditures other than
Permitted Capital Expenditures;
(vi) become liable in any way, whether directly or by
assignment or as guarantor or other surety, for the obligations of the
lessee under any lease other than any lease reasonably necessary (as
determined by the Program Manager on behalf of the Issuer) for the
performance of the acts and obligations of the Issuer under the
Financing Documents and the cumulative payments and receipts under
which is less than or equal to $5 million individually and $20 million
in the aggregate;
(vii) enter into any transaction with any Affiliate or any
Holder of a Note other than (A) the transactions contemplated by the
Financing Documents, the Management Agreement and the Underlying
Instruments or (B) transactions on terms no less favorable than those
obtainable in an arm's-length transaction with a wholly unaffiliated
Person
(viii) maintain any bank accounts other than the Collection
Account, the Uncommitted TIP Account, the Committed TIP Account, the
Excess Spread Account, the Expense Reserve Account, the Operating
Account and the Reserve Account, unless (x) such bank account (A) is
necessary for the transactions contemplated by the Transaction
Documents, as reasonably determined by the Issuer and (B) is pledged to
the Collateral Agent as Collateral and (y) each of the Issuer and the
Co-Issuer have taken all actions as may be necessary to Grant to the
Collateral Agent a perfected first priority security interest in such
account;
(ix) change its name without first delivering to the
Collateral Agent and each Representative 30 days' notice thereof
together with an Opinion of Counsel as to the continued first priority
perfection of the Lien of the Security Agreement;
(x) have any subsidiaries other than, with respect to the
Issuer, the Co-Issuer and any Intermediate Funding Entity;
(xi) except as otherwise contemplated in the Financing
Documents or the Partnership Agreement, directly or indirectly, (A)
declare or pay any dividend, or make any distribution, of any kind or
character (whether in cash, property or securities) in respect of any
partnership interest in the Issuer or stock in the Co-Issuer or (B)
purchase, redeem or otherwise acquire or retire for value, directly or
indirectly (1) any partnership interests in the Issuer, (2) any shares
in the Co-Issuer or (3) any options, warrants or rights to purchase or
acquire any such interest or share;
(xii) use any of the proceeds of the Backup Facility, the
Liquidity Facility or the Notes issued under the Indenture for any
purpose other than as contemplated hereunder or under the other
Financing Documents or use any such proceeds (A) to extend "purpose
credit" within the meaning given to such term in Regulation U, (B) to
purchase or otherwise acquire any Margin Security or (C) in any manner
that violates or results in any violation of any law or regulation;
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(xiii) enter into any amendments, modifications, waivers and
supplements to the Underlying Instruments in respect of Project Loans
or Intermediate Funding Loans which amendment, modification, waiver or
supplement will:
(A) in the reasonable judgment of the Issuer, cause a
Project Loan or an Intermediate Funding Loan to be less likely
to be repaid in full than prior to such amendment,
modification, waiver or supplement;
(B) cause an Event of Default to occur;
(C) unless an event of default has occurred and is
continuing in respect of a Project Loan, in which case clause
(D) below shall apply, cause such Project Loan or an
Intermediate Funding Loan to no longer satisfy the Project
Loan Criteria or Intermediate Funding Loan Criteria, as the
case may be (determined as if the Financial Closing Date for
such Project Loan or such Intermediate Funding Loan were on
the date of any such amendment, modification, waiver or
supplement); provided, that for purposes of this clause (C),
clause (3) of the definition of Project Loan Criteria will be
deemed satisfied if, the Initial Equity for a Project Borrower
on the date of such amendment, modification, waiver or
supplement is at least equal to the Initial Equity for such
Project Borrower on the Financial Closing Date of such Project
Loan or if the Initial Equity for such Project Borrower
expressed as a percentage of the total capitalization on the
date of such amendment, modification, waiver or supplement is
at least equal to the Initial Equity expressed as a percentage
of the total capitalization for such Project Borrower on the
Financial Closing Date of such Project Loan; or
(D) if such amendment, modification, waiver or
supplement relates to any material economic or legal term (a
"Material Modification"), cause the Rating Condition not to be
satisfied (as if the Financial Closing Date for such Project
Loan were the date of such amendment, modification, waiver or
supplement), except that if such Material Modification is made
during the continuance of an event of default under such
Project Loan, such Material Modification may be made so long
as (1) in the reasonable judgment of the Issuer after
consultation with the Rating Agencies, such Material
Modification would not be expected to cause a reduction or
withdrawal of the rating of any of the Class A Notes and Class
B Notes that would not otherwise occur in the absence of such
Material Modification and (2) if the result thereof is to
cause such Project Loan or Intermediate Funding Loan to no
longer satisfy the Project Loan Criteria or the Intermediate
Funding Loan Criteria, the Issuer shall have first considered
any practicable alternatives to such Material Modification
that would enable the Issuer to satisfy the Project Loan
Criteria or the Intermediate Funding Loan Criteria and shall
have concluded in good faith that agreeing to such Material
Modification was reasonable;
(xiv) hire any employees if the hiring of such employees
would cause the incurrence by either the Issuer or the Co-Issuer of any
liabilities under ERISA or the Code; or
(xv) dissolve or liquidate in whole or in part, except as
permitted hereunder.
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(b) Neither the Issuer nor the Co-Issuer nor the Collateral
Agent shall sell, transfer, exchange or otherwise dispose of Collateral, or
enter into or engage in any business with respect to any part of the Collateral,
except as expressly permitted by the Financing Documents.
(c) Other than as contemplated under the Transaction Documents
or the Underlying Instruments or the transactions contemplated thereby
(including, without limitation, to effectuate any issuance of Notes, the
Liquidity Notes, Funding Availability Notes or Support Notes after the Closing
Date), the Issuers shall not enter into any Additional Transaction Documents
without the prior written consent of the Required Lenders unless such agreement
(i) is related to or in furtherance of the transactions contemplated by the
Transaction Documents or the Underlying Instruments, (ii) could not reasonably
be expected to have a Material Adverse Effect and (iii) is not in violation of
any provisions of the Transaction Documents. The Issuers shall provide to the
Collateral Agent and each Representative notice of all Additional Transaction
Documents entered into pursuant to this Section 4.11(c) with cumulative payments
and receipts greater than or equal to $5 million, other than any confidentiality
agreements with Project Borrowers or Project Sponsors; provided, that the Issuer
shall provide to the Collateral Agent copies of all legally binding commitment
letters in respect of Project Loans or Intermediate Funding Loans.
(d) Notwithstanding anything herein or in any other Financing
Document to the contrary, the Co-Issuer shall not have, and shall take no action
that would cause it to have, any material assets or material income, and it
shall not succeed to, or have any right or entitlement to, proceeds from the
issuance of any Notes, the Collateral or any income or assets of the Issuer. The
Co-Issuer hereby waives any right or entitlement to proceeds from the issuance
of any Notes, the Collateral and any income or assets of the Issuer or any other
Person.
SECTION 4.12. Statement as to Compliance. Contemporaneously
with the delivery of the annual financial statements in accordance with Section
6.3, or immediately if there has been a Default, the Issuer shall deliver to the
Collateral Agent, each Representative and each Rating Agency, an Officer's
certificate stating, as to each signer thereof, that:
(a) a review of the activities of the Issuer and of the
Issuer's performance under this Agreement, the Indenture and the other Financing
Documents during the twelve-month period ending on December 31 of the year most
recently ended (or from the Closing Date until December 31, 1998, in the case of
the first such Officer's certificate) has been made under such Officer's
supervision; and
(b) to the best of such Officer's knowledge, based on such
review, the Issuer has fulfilled all of its obligations under the Financing
Documents throughout such period, or, if there has been a Default, specifying
each such Default known to such Officer and the nature and status thereof,
including actions undertaken to remedy the same.
SECTION 4.13. Issuers May Consolidate, Etc., Only on Certain
Terms.
(a) The Issuer shall not consolidate or merge with or into any
other Person or transfer or convey all or substantially all of its assets to any
Person, unless:
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(i) the Issuer shall be the surviving entity, or the Person
(if other than the Issuer) formed by such consolidation or into which
the Issuer is merged or to which all or substantially all of the assets
of the Issuer are transferred shall expressly assume the due and
punctual payment of all Secured Obligations and the performance of
every covenant and agreement of the Transaction Documents and any
Additional Transaction Documents on the part of the Issuer to be
performed or observed, all as provided therein;
(ii) each Rating Agency shall have been notified of such
consolidation, merger or transfer and the Trustee shall have received
written confirmation from each Rating Agency that its ratings issued
with respect to the Class A Notes and the Class B Notes are not and
will not be reduced or withdrawn as a result of the consummation of
such transaction;
(iii) if the Issuer is not the surviving entity, the Person
formed by such consolidation or into which the Issuer is merged or to
which all or substantially all of the assets of the Issuer are
transferred shall have agreed with the Collateral Agent (A) to observe
the same legal requirements for the recognition of such formed or
surviving entity as a legal entity separate and apart from any of its
Affiliates as are applicable to the Issuer with respect to its
Affiliates and (B) not to consolidate or merge with or into any other
Person or transfer or convey the Collateral or all or substantially all
of its assets to any other Person except in accordance with the
provisions of this Section 4.13;
(iv) if the Issuer is not the surviving entity, the Person
formed by such consolidation or into which the Issuer is merged or to
which all or substantially all of the assets of the Issuer are
transferred shall have delivered to the Collateral Agent, each
Representative, each Hedge Counterparty and each Rating Agency an
Officer's certificate and an Opinion of Counsel that is Independent
each stating that such Person shall be duly organized, validly existing
and in good standing in the jurisdiction in which such Person is
organized; that such Person has sufficient power and authority to
assume the obligations set forth in subsection (a)(i) above; that such
Person has duly authorized the execution, delivery and performance of
any documents necessary for assuming such obligations and that each
such document is a valid, legal and binding obligation of such Person,
enforceable against it in accordance with its terms, subject only to
bankruptcy, reorganization, insolvency, moratorium and other laws
affecting the enforcement of creditors' rights generally and to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); provided that,
immediately following the event which causes such Person to become the
successor to the Issuer, (A) such Person has good and marketable title,
free and clear of any Lien, security interest or charge, other than the
Lien and security interest of the Security Documents and other
Permitted Liens, to the Collateral; and (B) the Collateral Agent
continues to have a valid perfected first priority security interest in
the Collateral (subject only to Permitted Liens); and such other
matters as the Collateral Agent, any Representative or any Hedge
Counterparty may reasonably require;
(v) immediately after giving effect to such transaction, no
Default shall have occurred and be continuing;
(vi) the Issuer shall have notified each Rating Agency of such
consolidation, merger, transfer or conveyance and shall have delivered
to the Collateral Agent, each
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Representative and each Hedge Counterparty an Officer's certificate and
an Opinion of Counsel that is Independent each stating that such
consolidation, merger, transfer or conveyance and related documentation
comply with this Article 4, that all conditions precedent in this
Article 4 provided for relating to such transaction have been complied
with and that no adverse tax consequences will result therefrom to the
Secured Parties; and
(vii) the Issuer shall have delivered to the Collateral Agent,
each Representative and each Hedge Counterparty an Opinion of Counsel
that is Independent stating that after giving effect to such
transaction, (i) the Issuer will not be required to register as an
investment company under the Investment Company Act, (ii) the Class A
Notes and Class B Notes will be treated as debt for U.S. federal income
tax purposes, (iii) the Issuer (or if the Issuer is not the surviving
entity, the Person formed by such transaction or into which the Issuer
has merged or transferred substantially all its assets) will not be
subject to tax on its net income, (iv) payments made on the Class A
Notes and Class B Notes will not be subject to withholding taxes that
exceed the taxes to which such payments would have been subject had
such transaction not been effected and (vi) payments received on the
Collateral will not be subject to withholding or other tax that exceed
the taxes to which such payments would have been subject had such
transaction not been effected.
(b) The Co-Issuer shall not consolidate or merge with or into
any other Person or transfer or convey all or substantially all of its assets to
any Person, unless:
(i) the Co-Issuer shall be the surviving corporation, or the
Person (if other than the Co-Issuer) formed by such consolidation or
into which the Co-Issuer is merged or to which all or substantially all
of the assets of the Co-Issuer are transferred shall expressly assume
the due and punctual payment of all Secured Obligations and the
performance of every covenant and agreement of the Transaction
Documents and any Additional Transaction Documents on the part of the
Co-Issuer to be performed or observed, all as provided therein;
(ii) each Rating Agency shall have been notified of such
consolidation, merger or transfer and the Trustee shall have received
written confirmation from each Rating Agency that its ratings issued
with respect to the Class A Notes and the Class B Notes are not and
will not be reduced or withdrawn as a result of the consummation of
such transaction;
(iii) if the Co-Issuer is not the surviving corporation, the
Person formed by such consolidation or into which the Co-Issuer is
merged or to which all or substantially all of the assets of the
Co-Issuer are transferred shall have agreed with the Collateral Agent
(A) to observe the same legal requirements for the recognition of such
formed or surviving corporation or other entity as a legal entity
separate and apart from any of its Affiliates as are applicable to the
Co-Issuer with respect to its Affiliates and (B) not to consolidate or
merge with or into any other Person or transfer or convey the
Collateral or all or substantially all of its assets to any other
Person except in accordance with the provisions of this Section 4.13;
(iv) if the Co-Issuer is not the surviving corporation, the
Person formed by such consolidation or into which the Co-Issuer is
merged or to which all or substantially all of the assets of the
Co-Issuer are transferred shall have delivered to the Collateral Agent,
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each Representative, each Hedge Counterparty and each Rating Agency an
Officer's certificate and an Opinion of Counsel that is Independent
each stating that such Person shall be duly organized, validly existing
and in good standing in the jurisdiction in which such Person is
organized; that such Person has sufficient power and authority to
assume the obligations set forth in subsection (a)(i) above and that
such Person has duly authorized the execution, delivery and performance
of any documents necessary for assuming such obligations and that each
such document is a valid, legal and binding obligation of such Person,
enforceable against it in accordance with its terms, subject only to
bankruptcy, reorganization, insolvency, moratorium and other laws
affecting the enforcement of creditors' rights generally and to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and such other matters
as the Collateral Agent, any Representative or any Hedge Counterparty
may reasonably require; provided that, immediately following the event
which causes such Person to become the successor to the Co-Issuer, (A)
such Person has good and marketable title, free and clear of any Lien,
security interest or charge, other than the Lien and security interest
of the Security Documents and other Permitted Liens, to the Collateral;
and (B) the Collateral Agent continues to have a valid perfected first
priority security interest in the Collateral (subject only to Permitted
Liens); and such other matters as the Collateral Agent, any
Representative or any Hedge Counterparty may reasonably require;
(v) immediately after giving effect to such transaction, no
Default shall have occurred and be continuing;
(vi) the Co-Issuer shall have notified each Rating Agency of
such consolidation, merger, transfer or conveyance and shall have
delivered to the Collateral Agent, each Representative and each Hedge
Counterparty an Officer's certificate and an Opinion of Counsel that is
Independent each stating that such consolidation, merger, transfer or
conveyance and related documentation comply with this Article 4, that
all conditions precedent in this Article 4 provided for relating to
such transaction have been complied with and that no adverse tax
consequences will result therefrom to the Secured Parties;
(vii) the Co-Issuer shall have delivered to the Collateral
Agent, each Representative and each Hedge Counterparty an Opinion of
Counsel that is Independent stating that after giving effect to such
transaction, the Co-Issuer will not be required to register as an
investment company under the Investment Company Act; and
(viii) after giving effect to such transaction, the
outstanding stock of the Co-Issuer will not be beneficially owned by
any Person other than the Issuer.
SECTION 4.14. Successor Substituted. Upon any consolidation or
merger, or transfer or conveyance of all or substantially all of the assets of
the Issuer or the Co-Issuer, in accordance with Section 4.13 hereof, the Person
formed by or surviving such consolidation or merger (if other than the Issuer or
the Co-Issuer, as the case may be), or, the Person to which such consolidation,
merger, transfer or conveyance is made, shall succeed to, and be substituted
for, and may exercise every right and power of, and shall be bound by each
obligation or covenant of, the Issuer or the Co-Issuer, as the case may be,
under each Transaction Document or any Additional Transaction Document to which
either is a party with the same effect as if such
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Person had been named as the Issuer or the Co-Issuer therein. In the event of
any such consolidation, merger, transfer or conveyance, the Person named as the
"Issuer" or the "Co-Issuer" in the first paragraph of this Agreement and any of
the Transaction Documents and Additional Transaction Documents or any successor
which shall theretofore have become such in the manner prescribed in this
Article 4 may be dissolved, wound-up and liquidated at any time thereafter, and
such Person thereafter shall be released from its liabilities as obligor and
maker on all the Notes and from its obligations under each Transaction Document
or any Additional Transaction Document to which it is a party.
SECTION 4.15. No Other Business. The Issuer shall not engage
in any business or activity other than (1) the funding, disposition, ownership
and management of Project Loans, (2) making Commitments in respect of Project
Loans, (3) issuing, from time to time, the Notes, the Interests, the GP
Interests and the Support Notes, (4) pledging the Collateral as security for the
Secured Obligations, (5) entering into Hedging Agreements, (6) establishing and
owning, from time to time, the interests in one or more Intermediate Funding
Entities, (7) making Temporary Investments and Eligible Investments, (8) owning
the shares of the Co-Issuer and (9) entering into Backup Facility Loan
Agreements and the Liquidity Facility Loan Agreement; and the Co-Issuer shall
not engage in any business or activity other than issuing and selling the Notes
pursuant to the Indenture, and with respect to the Issuer and the Co-Issuer,
such other activities which are necessary, required or advisable to accomplish
the foregoing or are incidental thereto or connected therewith. The Issuers will
not amend their organizational documents if such amendment could reasonably be
expected to result in the rating of the Class A Notes or the Class B Notes being
reduced or withdrawn; provided that Sections ____ and ____ of the Partnership
Agreement shall not be amended without the prior written consent of the
Required Lenders.
SECTION 4.16. Funding of Class I Interests of the Issuer. The
Issuer shall, at all times on and after the Closing Date, cause at least five
(5) percent of the total funded capitalization of the Issuer to consist of
funded Class I Interests.
SECTION 4.17. Ratings Review. So long as any of the Class A
Notes or the Class B Notes remain Outstanding, on or before December 31 in each
year commencing in 1999, the Issuers shall obtain and pay for an annual review
of the ratings by ▇▇▇▇▇'▇ and S&P of such Class A Notes and Class B Notes unless
the ratings of such Notes were otherwise fully reviewed and reaffirmed during
such year. The Issuers shall promptly notify the Collateral Agent and each
Representative in writing if at any time the ratings of any such Class of Notes
have been, or are known will be, changed or withdrawn.
SECTION 4.18. Tax Returns. The Issuers shall each comply in
all material respects with all foreign, federal, state and local tax obligations
including filing applicable tax returns, paying applicable taxes (including
withholding taxes) and complying with information reporting requirements.
SECTION 4.19. Financial Statements. Each of the Issuer and
Co-Issuer shall furnish, or cause to be furnished, to each Representative and
the Collateral Agent, any financial statements filed with the Commission from
time to time pursuant to Section 6.3, within 15 days after the date the Issuer
or Co-Issuer is required to file the same with the Commission.
SECTION 4.22. Allocations under Backup Facility. Immediately
prior to the end of the revolving period of each Backup Facility, the Issuer
shall request a drawdown hereunder in an aggregate principal amount equal to all
amounts Allocated thereunder and deposit the proceeds thereof in the Committed
TIP Account.
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SECTION 4.20. Pledge of Interests in Intermediate Funding
Entities. The Issuer shall deliver all certificates evidencing all of its
ownership interests in each Intermediate Funding Entity that it may now or
hereafter establish, and cause such Intermediate Funding Entity and any direct
or indirect subsidiary of such Intermediate Funding Entity to deliver all
certificates evidencing all of its ownership interests in any direct or indirect
subsidiary of such entity, to the Collateral Agent for the benefit of the
Secured Parties.
SECTION 4.21. Utilization of Amounts Available under Project
Borrower Debt Service Reserve Accounts. In the event a Project Borrower fails to
make any payment on its Project Loan when such amount becomes due and payable in
accordance with the terms of such Project Loan, the Issuer shall withdraw, to
the extent practicable and subject to any applicable laws and regulations, from
amounts on deposit in the debt service reserve account of such Project Borrower,
an amount equal to such defaulted payment and cause such funds to be credited to
the Collection Account as Collateral Proceeds.
ARTICLE 5
EVENTS OF DEFAULT AND REMEDIES
SECTION 5.1. Events of Default. Subject to the provisions of
Article 12, the term "Event of Default", whenever used in any Financing
Document, shall mean any of the following events (whatever the reason for such
event and whether it shall be voluntary or involuntary or come about or be
effected by operation of law, or be pursuant to or in compliance with any
applicable law), and any such event shall continue to be an Event of Default if
and for so long as it shall not have been remedied or waived:
(a) default in the payment of any interest or fees owing with
respect to the Liquidity Facility, the Backup Facility or the Notes, or
default in any payment due to a Hedge Counterparty under any Hedging
Agreement, in any event when the same becomes due and payable, which
default shall continue for a period of three Business Days;
(b) (i) default at its Stated Maturity in the payment of
principal of any Class of Notes or (ii) default at the applicable
Stated Maturity in the payment of principal of amounts outstanding
under the Liquidity Facility or the Backup Facility;
(c) the failure on any Quarterly Payment Date to disburse
amounts (other than amounts described in clauses (a) or (b) above)
available in the Collection Account in accordance with the Priority of
Payments and continuation of such failure for a period of five Business
Days;
(d) either of the Issuers becomes an investment company
required to be registered under the Investment Company Act;
(e) default in the performance, or breach, of any other
covenant of the Issuer or the Co-Issuer under the Indenture or any
other Financing Document to which it is a party or of the Program
Manager under the Management Agreement, or any representation or
warranty of the Issuer or the Co-Issuer made in the Indenture or any
other Financing Document to which it is a party or of the Program
Manager made in the Management
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Agreement, or in any certificate or writing delivered by the Issuer or
the Co-Issuer pursuant to the Indenture, any other Financing Document
to which it is a party or by the Program Manager pursuant to the
Management Agreement, proves to be incorrect in any material respect
when made, and such default, breach or misrepresentation continues for
a period of 90 days after notice to the Issuer and the Program Manager
by the Collateral Agent or the Required Lenders, provided, however,
that such cure period shall apply only to those defaults, breaches or
misrepresentations capable of being cured;
(f) default in the performance, or breach, of any covenant of
Enron or any of its subsidiaries under the Enron Support Agreement or
any representation or warranty of Enron or any of its subsidiaries
thereunder, or in any certificate or writing delivered pursuant
thereto, proves to be incorrect in any material respect when made, and
such default, breach or misrepresentation continues for a period of 30
days after notice to the Issuer and the Program Manager by the
Collateral Agent or the Required Lenders; provided, however, that such
cure period shall apply only to the defaults, breaches or
misrepresentations capable of being cured;
(g) default in the performance, or breach, of any covenant of
the purchaser of Class I Interests pursuant to its Class I Commitment
Letter or any representation or warranty thereunder proves to be
incorrect in any material respect when made and such default, breach,
or misrepresentation continues for a period of 30 days after notice to
the Issuer and the Program Manager by the Collateral Agent or the
Required Lenders; provided, however, that such cure period shall apply
only to the defaults, breaches or misrepresentations capable of being
cured;
(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of the Issuer or the
Co-Issuer or Enron or its debts, or of a substantial part of its
assets, under any bankruptcy, insolvency, receivership or similar law
now or hereafter in effect or (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for
the Issuer or the Co-Issuer or Enron or for a substantial part of its
assets, and, in any such case, such proceeding or petition shall
continue undismissed for 60 days; or an order or decree approving or
ordering any of the foregoing shall be entered;
(i) the Issuer or the Co-Issuer or Enron shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (ii) consent to
the institution of, or fail to contest in a timely and appropriate
manner, any proceeding or petition involving it and described in
Section 5.1(h), (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for it or for a substantial part of its assets, (iv) file an
answer admitting the material allegations of a petition filed against
it in any such proceeding, (v) make a general assignment for the
benefit of creditors or (vi) take any action for the purpose of
effecting any of the foregoing; or
(j) the failure of the Issuer to cause the Collateral Agent to
have a first priority perfected security interest with respect to the
Collateral (subject only to Permitted Liens), and, in the case of a
failure that is capable of being cured, the continuance of such failure
for a period of 30 days.
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Upon the occurrence of an Event of Default, the Issuer shall
promptly notify the Collateral Agent, each Representative, the Program Manager,
each Hedge Counterparty and each Rating Agency in writing.
SECTION 5.2. Remedies. Subject to Article 3 of the
Intercreditor Agreement, upon the occurrence and during the continuation of an
Event of Default, the Collateral Agent and each Representative on behalf of the
Secured Parties for whom such Representative is acting may, without further
notice of default, presentment or demand for payment, protest or notice of
non-payment or dishonor, or other notices or demands of any kind, all such
notices and demands being waived (to the extent permitted by applicable law),
exercise any or all rights and remedies at law or in equity (in any combination
or order that the Secured Parties may elect), including without limitation or
prejudice to the Secured Parties' other rights and remedies, the following:
(a) declare and make all sums of accrued and outstanding
principal and accrued but unpaid interest remaining under the Notes,
the Indenture, the Liquidity Facility and the Backup Facility together
with all unpaid fees, costs and charges due thereunder or under any
other Financing Document, immediately due and payable (such event, an
"Acceleration"), provided that in the event of an Event of Default
occurring under Section 5.1(h) or Section 5.1(i), all such amounts
shall become immediately due and payable without further act of any
Secured Party; and
(b) exercise any and all other rights and remedies available
to it under any of the Financing Documents.
ARTICLE 6
ACCOUNTINGS; REPORTS
SECTION 6.1. Accountings.
(a) Quarterly Payment Date Account. The Issuer shall render an
accounting (each, a "Valuation Report"), determined as of each Determination
Date, and to deliver such report to each Rating Agency, the Collateral Agent and
each Representative not later than the third Business Day immediately preceding
the Quarterly Payment Date. The Valuation Report shall contain the following
information:
(i) the Aggregate Book Value of the Issuer's Assets;
(ii) the aggregate Principal Balance of all Permitted
Investments;
(iii) the aggregate Principal Balance of all Permitted
Investments purchased since the Determination Date for the last
Valuation Report;
(iv) Permitted Investments any payments in respect of which
are in default since the Determination Date for the last Valuation
Report and the circumstances and amount of each default;
(v) for each Project Loan:
(A) the Project Borrower;
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(B) the Industry of the Eligible Project;
(C) the Designated Enron Ownership Interest in the
Project Borrower;
(D) the actual percentage of Initial Equity owned by
Enron or any Enron Affiliate, or the acquisition of which
Enron or such Enron Affiliate has entered into a legally
binding commitment;
(E) the annual interest rate;
(F) the maturity date;
(G) Standard & Poor's Rating and ▇▇▇▇▇'▇ Rating;
(H) its Principal Balance;
(I) unfunded Commitments;
(J) the Project Loan Balance;
(K) the difference, if any, between the principal
balance and the annual interest rate of each Intermediate
Funding Loan and the principal balance and the annual interest
rate of the related Project Loan and the total operating
expenses and taxes of all Intermediate Funding Entities
relating to each Project Loan for the applicable Due Period;
(vi) a list of the Project Loans that were initially funded
since the Determination Date of the last Valuation Report and the
amortization schedule and Expected Average Life for each;
(vii) a list of the Project Loans that became Defaulted
Project Loans since the Determination Date of the last Valuation Report
and the circumstances and amount of each default;
(viii) the Project Loan Balance for all Defaulted Project
Loans;
(ix) the Principal Balance, the unfunded Commitments and
Project Loan Balance of all Project Loans aggregated by country,
Continent and Region and the Aggregate Project Loan Balance;
(x) the number and identity of any Project Loans that were
released for Sale (indicating whether such Project Loan was sold or
disposed of pursuant to Section 2.5 (a)(iii), Section 2.5 (a)(iv) or
Section 2.5 (a)(v) of the Security Agreement) or Granted to the
Collateral Agent since the Determination Date for the last Valuation
Report;
(xi) the Principal Balance, unfunded Commitments and the
Project Loan Balance of all Project Loans that are obligations of
issuers or obligors located in any one country whose long-term
sovereign debt obligations are rated, on the Financial Closing Date
applicable to each such Project Loan, at or above "AA" by Standard &
Poor's and "Aa2" by Moodys;
(xii) the Principal Balance, the unfunded Commitments and the
Project Loan Balance of all Project Loans that are obligations of
issuers or obligors located in any one country whose long-term
sovereign debt obligations are rated, on the Financial Closing Date
applicable to each such Project Loan, below "AA" by Standard & Poor's
or "Aa2" by ▇▇▇▇▇'▇;
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(xiii) the outstanding commitments and amounts drawn under the
Backup Facility (including amounts drawn under any Funding Availability
Commitments) and Liquidity Facility and amounts Allocated under the
Backup Facility (including the amount of any unused Funding
Availability Commitment) and the outstanding commitments and amounts
drawn under the Credit Support Commitments;
(xiv) a calculation in reasonable detail necessary to
determine compliance with the Portfolio Financial Tests (to the extent
required to have been made since the date of determination of the last
Valuation Report in connection with any Project Loan);
(xv) (A) the Outstanding Amount of the Notes of each Class
and, in the case of Class A Notes and the Class B Notes, each Series
thereof, such Outstanding Amount of each such Series as a percentage of
the aggregate principal amount of such Series on the issuance date
thereof, in each case, on the first day of the Interest Accrual Period
preceding the next Quarterly Payment Date, (B) the amount of principal
payments to be made on the Notes of each Class on the next Quarterly
Payment Date, (C) the amount of any Class B Deferred Interest on the
next Quarterly Payment Date, and (D) the Outstanding Amount of the
Notes of each Class and, in the case of Class A Notes and the Class B
Notes, each Series thereof, such Outstanding Amount of each such Series
as a dollar figure and as a percentage of the aggregate principal
amount of such Series on the issuance date thereof, in each case, after
giving effect to the principal payments, if any, on the next Quarterly
Payment Date;
(xvi) the interest payable to the Holders of the Notes for
such Quarterly Payment Date (in the aggregate and by Class and Series);
(xvii) the amount of Collateral Proceeds received during the
related Due Period;
(xviii) if such Quarterly Payment Date occurs after the
expiration of the Liquidity Facility Availability Period, the estimated
Operating Expenses payable during the Due Period immediately following
such Determination Date;
(xix) for each Account:
(A) the Balance of such Account at the close of
business on such Determination Date; and
(B) the Balance, if any, expected to remain in such
Account after giving effect to all payments and deposits to be
made on the related Quarterly Payment Date;
(xx) the Diversity Score as of the close of business on such
Determination Date;
(xxi) the Senior Overcollateralization Ratio as of the close
of business on such Determination Date;
(xxii) the Total Overcollateralization Ratio as of the close
of business on such Determination Date;
(xxiii) the Target Senior Overcollateralization Ratio as of
the close of business on such Determination Date;
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(xxiv) the Target Total Overcollateralization Ratio as of the
close of business on such Determination Date;
(xxv) a calculation in reasonable detail necessary to
determine whether the Senior Coverage Test and the Reserve Test have
been satisfied;
(xxvi) the amounts to be paid and to be received under each
Hedging Agreement during the immediately succeeding Due Period together
with a copy of the confirmation for each Hedging Agreement;
(xxviii) amounts, if any, transferred to the Operating Account
pursuant to Section 3.2(c) of the Security Agreement and a calculation
in reasonable detail necessary to make the determination required
pursuant to such section; and
(xxix) the Quarterly Project Distributions and Project
Distributions Reserved on such Determination Date.
Each Valuation Report shall be compiled based upon the
information contained in the records maintained by the Program Manager on behalf
of the Issuer as well as information provided by the Collateral Agent and each
Representative with respect to the Collateral.
(b) In addition to the information described under Section 6.1
(a), each Valuation Report shall set forth, in respect of the Quarterly Payment
Date related to such Valuation Report, the following amounts:
(i) the amounts to be applied in respect of each clause under
the Priority of Payments; and
(ii) the amounts to be applied in respect of each clause under
Sections 4.1(b), 4.3(a) and 4.3(b) of the Security Agreement, to the
extent applicable.
Notwithstanding anything in this Section 6.1 to the contrary,
however, in the event there shall be deposited in the Collection Account any
Collateral Proceeds otherwise scheduled to have been received on or prior to a
Determination Date, and such deposit is made no later than the Business Day
immediately preceding the related Quarterly Payment Date, the Issuer shall
render a revised Valuation Report prepared as though such amounts were credited
to the Collection Account on the original Determination Date and cause such
Valuation Report to be delivered to each Rating Agency, the Collateral Agent and
each Representative no later than such Quarterly Payment Date, which report
shall replace and substitute the Valuation Report previously delivered in
respect of such Determination Date. Collateral Proceeds received after a
Determination Date but applied for payment on the Quarterly Payment Date
relating to such Determination Date in accordance with the foregoing sentence
shall be deemed excluded from Collateral Proceeds for the purposes of the Due
Period ending on the subsequent Determination Date.
(c) If the Collateral Agent shall not have received any
accounting provided for in this Section 6.1 by the first Business Day after the
date on which such accounting was due to have been received by the Collateral
Agent, the Collateral Agent shall use reasonable efforts to cause such
accounting to be made by the applicable Quarterly Payment Date. To the extent
the Collateral Agent is required to provide any information or reports pursuant
to this Section 6.1 as a result of the failure of the Program Manager to provide
such information or reports, the Collateral Agent shall be entitled to retain an
Independent certified public accountant in
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connection therewith, and the reasonable costs incurred by the Collateral Agent
for such Independent certified accountant shall be reimbursed as an
Extraordinary Expense pursuant to Section 4.1 of the Security Agreement.
SECTION 6.2. Reports by Independent Accountants.
(a) At the Closing Date the Issuer shall appoint a firm of
Independent certified public accountants of recognized international reputation
for purposes of preparing and delivering the reports or certificates of such
accountants required by any of the Financing Documents. Upon any resignation by
such firm, the Issuer shall promptly appoint, by Issuer Request delivered to the
Collateral Agent, each Representative and each Rating Agency, a successor
thereto that shall also be a firm of Independent certified public accountants of
recognized international reputation and deliver notice thereof to each
Representative. the Collateral Agent and each Rating Agency. If the Issuer shall
fail to appoint a successor to a firm of Independent certified public
accountants which has resigned within 30 days after such resignation, the Issuer
shall promptly notify the Collateral Agent and the Representatives of such
failure in writing. If the Issuer shall not have appointed a successor within
ten days thereafter, the Collateral Agent shall promptly appoint a successor
firm of Independent certified public accountants of recognized international
reputation upon approval of the Issuer. The fees of such Independent certified
public accountants and its successor shall be payable as provided in (and to the
extent set forth in) Section 8(a) of the Management Agreement.
(b) Contemporaneously with the delivery of the annual
financial statements in accordance with Section 6.3, the Issuer shall cause to
be delivered to the Collateral Agent, each Representative and each Rating Agency
a statement from a firm of Independent certified public accountants indicating
(i) that such firm has reviewed the Valuation Reports and Redemption Date
Statements received since the last review and applicable information from the
Collateral Agent and the Representatives, and (ii) that the calculations within
those Valuation Reports and Redemption Date Statements have been performed in
accordance with the applicable provisions of this Agreement and the other
Financing Documents; provided that in the event of a conflict between such firm
of Independent certified public accountants and the Issuer with respect to any
matter in this Section 6.2, the determination by such firm of Independent public
accountants shall be conclusive.
SECTION 6.3. Reports by Issuers. The Issuers shall file with
the Commission, with copies to the Collateral Agent and each Representative to
be provided within 15 days after the Issuer is required to file the same with
the Commission, the annual reports, the financial statements and the
information, documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules and regulations
prescribe) which the Issuers may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the Issuers
are not required to file information, documents or reports pursuant to either of
said Sections, then they shall file with the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations.
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ARTICLE 7
CALCULATIONS
SECTION 7.1. Assumptions as to Project Loans; Etc. In
connection with all calculations required to be made pursuant to this Agreement
or any of the other Financing Documents with respect to Scheduled Payments on
any Project Loan and Permitted Investment, or any payments on any other assets
included in the Collateral, and with respect to the income that can be earned on
Scheduled Payments on such Project Loan and Permitted Investment and on any
other amounts that may be received for deposit in the Collection Account, the
provisions set forth in this Section 7.1 shall be applied.
(a) All calculations with respect to Scheduled Payments on the
Project Loans and Permitted Investments shall be made on the basis of
information as to the terms of each such Project Loan or Permitted Investment
and upon report of payments, if any, received on such Project Loan and Permitted
Investment that are furnished by or on behalf of the issuer of such Project Loan
or Permitted Investment and, to the extent they are not manifestly in error,
such information or report may be conclusively relied upon in making such
calculations.
(b) For each Due Period, the Scheduled Payment on any Project
Loan or Permitted Investment (other than a Defaulted Project Loan or Defaulted
Permitted Investment which shall be assumed to have a Scheduled Payment equal to
the product of the original Scheduled Payment and 100% minus the Assumed Loss
Amount shall be the total amount of payments and collections in respect of such
Project Loan or Permitted Investment received during the Due Period.
(c) Each Scheduled Payment receivable with respect to a
Project Loan or Permitted Investment (other than a Defaulted Project Loan or
Defaulted Permitted Investment which shall be assumed to have a Scheduled
Payment equal to the product of the original Scheduled Payment and 100% minus
the Assumed Loss Amount shall be assumed to be received on the applicable Due
Date, and each such Scheduled Payment shall be assumed to be immediately
deposited in the Collection Account (or any other Account in accordance with the
terms of the Financing Documents) and, except as otherwise specified, to earn
interest at the Assumed Reinvestment Rate. All such funds shall be assumed to
continue to earn interest until the date on which they are required to be
available in the Collection Account (or otherwise) for application, in
accordance with the terms hereof, to payments of principal of or interest on the
Secured Obligations or other amounts payable pursuant to this Agreement and the
other Financing Documents.
(d) With respect to (i) any Project Loan as to which any
interest or other payment thereon is subject to withholding tax of any relevant
jurisdiction or (ii) any Intermediate Funding Loan as to which any payments of
operating expenses of the related Intermediate Funding Entity are deducted from
principal or interest thereon or fees relating thereto, each Scheduled Payment
thereon shall, for purposes of the Portfolio Financial Tests including the
Actual Net Interest Margin, be deemed to be payable net of such withholding tax
or such operating expenses unless the issuer thereof or obligor thereon is
required to make additional payments to fully compensate the Issuer for such
withholding taxes or such operating expenses (including in respect of any such
additional payments). On any date of determination, the amount of any Scheduled
Payment due on any future date shall be assumed to be made net of any such
withholding tax or such
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operating expenses based upon withholding tax rates or such operating expenses
in effect on such date of determination, unless the issuer thereof or obligor
thereon is required to make additional payments to fully compensate the Issuer
for such withholding taxes or such operating expenses (including in respect of
any such additional payments).
(e) Without limiting the generality of the foregoing, in
making determinations in respect of the Liquidity Test, the Program Manager will
create projections (i) assuming both a High Interest Rate Scenario and a Low
Interest Rate Scenario for purposes of calculating (1) the projected interest
income on Temporary Investments, (2) the projected payments or amounts to be
received in respect of the Hedging Agreements and (3) the projected interest
payable on the Backup Facility and the Liquidity Facility, (ii) assuming that
(1) amounts credited to the Uncommitted TIP Account are liquidated at current
market levels and used to reduce amounts Allocated, if any, under the Backup
Facility and then are used to redeem Notes and repay draws, if any, under the
Backup Facility, in order of seniority, on the first Quarterly Payment Date of
the Measurement Period and (2) amounts credited to the Committed TIP Account are
invested at the contracted rates thereof until maturity and are reinvested at
three-month LIBOR pending reinvestment into Project Loans pursuant to the
assumed drawdown schedule, (iii) assuming that with respect to committed
Eligible Projects, if any, that are in their construction phase, each draw
occurs one year later than the date assumed in the drawdown schedule, (iv)
assuming that amounts, if any, drawn or Allocated under the Backup Facility are
refinanced with Class A Senior Notes at the rate currently payable on the Backup
Facility and with respect to amounts Allocated under the Backup Facility, the
proceeds thereof are credited to the Committed TIP Account on the first
Quarterly Payment Date of the Measurement Period, (v) assuming that no further
Project Loans are committed to by the Issuer and (vi) assuming that all Hedging
Agreements currently in place and, if applicable, those expected to be in place
following addition of the Project Loan proposed to be added to the Portfolio
Assets are terminated on the first Quarterly Payment Date of the Measurement
Period.
ARTICLE 8
CONDITIONS PRECEDENT
SECTION 8.l. General Provisions. The Notes to be issued on the
Closing Date may be executed by the Issuers and delivered to the Trustee for
authentication and thereupon the same shall be authenticated and delivered by
the Trustee (or an Authenticating Agent on its behalf) upon Issuer Request, and
the effectiveness of the Notes, the Liquidity Facility Loan Agreement and any
Backup Facility Loan Agreement, are subject to receipt by the Collateral Agent
(with sufficient copies for each Representative) of the following:
(a) an Officer's certificate of the Issuer (i) evidencing the
authorization by Board Resolution of the execution and delivery by the Issuer of
each of the Financing Documents, the Management Agreement and the Hedging
Agreements then in place and the execution, authentication and delivery by the
Issuer of the Notes and specifying the Stated Maturity, the principal amount and
Class (and, as to Class A Notes and Class B Notes, Series designation) of the
Notes to be authenticated and delivered, and (ii) certifying that (A) the
attached copy of such Board Resolution is a true and complete copy thereof, (B)
such Board Resolution has not been rescinded and is in full force and effect on
and as of the Closing Date, (C) the Officers
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authorized to execute and deliver such documents hold the offices and have the
signatures indicated thereon and (D) no other Board Resolution is in effect
related to matters set forth therein;
(b) an Officer's certificate of the Co-Issuer (i) evidencing
the authorization by Board Resolution of the execution and delivery by the
Co-Issuer of each of the Financing Documents to which it is a party and the
Management Agreement, and the execution, authentication and delivery of the
Notes and specifying the Stated Maturity, the principal amount and Class (and as
to Class A Notes and Class B Notes, Series designation) of the Notes to be
authenticated and delivered, and (ii) certifying that (A) the attached copy of
such Board Resolution is a true and complete copy thereof, (B) such Board
Resolution has not been rescinded and is in full force and effect on and as of
the Closing Date, (C) the Officers authorized to execute and deliver such
documents hold the offices and have the signatures indicated thereon and (D) no
other Board Resolution is in effect related to matters set forth therein;
(c) any other instrument or document, fully executed (as
applicable), necessary to consummate and perfect the Grant of a first priority
security interest (subject only to Permitted Liens) in favor of the Collateral
Agent for the benefit of the Secured Parties, in all of the Issuers' right,
title and interest in and to the Collateral;
(d) an opinion of Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, special New
York counsel to the Issuers, dated the Closing Date, substantially in the form
of Exhibit B hereto;
(e) an opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P. counsel to Enron
dated the Closing Date, substantially in the form of Exhibit C hereto;
(f) an opinion of the General Counsel of Enron, dated the
Closing Date, substantially in the form of Exhibit D hereto;
(g) an executed copy of the Common Agreement;
(h) an executed copy of the Security Agreement;
(i) an executed copy of the Intercreditor Agreement;
(j) an executed copy of the Management Agreement;
(k) an executed copy of each Hedging Agreement then in place
(and all acknowledgements thereto);
(l) an executed copy of the Liquidity Facility Loan Agreement;
(m) an executed copy of each Backup Facility Loan Agreement in
effect on such date, if any;
(n) an executed copy of the Enron Support Agreement;
(o) an executed copy of the TIP Investment Management
Agreement;
(p) an executed copy of the Partnership Agreement and
certified copies of the Certificate of Incorporation and the By-laws of the
Co-Issuer;
(q) executed copies of all Class I Stage Funding Commitment
Letters; and
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(r) certified copies of the [organizational documents of
intermediate equityholders].
SECTION 8.2. Additional Conditions. On the Closing Date, the
Issuers shall cause the following conditions to be satisfied:
(a) Funding of Class I Interests of the Issuer. Interests in
an amount at least equal to $250,000,000 shall have been funded or committed to
be funded (pursuant to one or more Class I Stage Funding Commitment Letters in
the case of Class I Interests); provided, that at least five (5) percent of the
total funded capitalization of the Issuer shall consist of funded Class I
Interests on the Closing Date, and provided, further, that each holder of a
Class I Stage Funding Commitment shall be an Acceptable Credit Provider.
(b) Rating Letters. The delivery to the Trustee of an
Officer's certificate of the Issuer to the effect that attached thereto is a
true and correct copy of (i) a letter signed by ▇▇▇▇▇'▇ confirming that the
Class A Notes and the Class B Notes have been rated at least "A2" and "Ba2",
respectively, by ▇▇▇▇▇'▇ and that such ratings are in full force and effect on
the Closing Date; and (ii) a letter signed by Standard & Poor's confirming that
the Class A Notes and the Class B Notes have been rated at least "A" and "BB",
respectively, by Standard & Poor's and that such ratings are in full force and
effect on the Closing Date.
(c) Accounts. The delivery by the Account Bank of evidence of
the establishment of each of the Accounts (other than the Expense Reserve
Account and the Distribution Obligation Escrow Account).
(d) Payment of Issuance Related Expenses. The Issuer shall pay
all Initial Issuance Expenses of the Issuers from the proceeds of such issuance.
ARTICLE 9
HEDGING AGREEMENTS; BACKUP FACILITY LOAN AGREEMENTS; LIQUIDITY
FACILITY LOAN AGREEMENT
SECTION 9.1. Hedging Agreements.
(a) The Issuer will enter into and terminate one or more
Hedging Agreements only to the extent they are consistent with the objectives
described in the Prospectus under the caption "Hedging Agreements" (and shall
deliver to the Collateral Agent original counterpart copies of each such Hedging
Agreement).
(b) Subject to the Intercreditor Agreement, amounts due to the
Hedge Counterparties under the Hedging Agreements shall be paid when such
amounts are due thereunder, in accordance with the Priority of Payments or the
Priority of Acceleration Payments, as applicable, and otherwise as provided
under the Security Agreement (it being understood and agreed that payments owing
by the Issuer to any Hedge Counterparty under a Hedging Agreement may be setoff
against payments owing to the Issuer by such Hedge Counterparty under such
Hedging Agreement (but not against any other obligations owing to or by the
Issuer) without regard to the Priority of Payments or Priority of Acceleration
Payments).
(c) Each Hedging Agreement shall provide:
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(i) that such Hedging Agreement shall be governed by and
construed in accordance with the laws of the State of New York; and
(ii) that such Hedging Agreement shall terminate at the option
of the Issuer upon the failure of the related Hedge Counterparty to
agree to provide Hedge Counterparty Credit Support within two Business
Days after the failure of the senior, unsecured debt or deposit
obligations of the related Hedge Counterparty (or any Person that shall
have absolutely and unconditionally guaranteed the obligations of such
Hedge Counterparty under such Hedging Agreement) to be rated at least
"A2" by ▇▇▇▇▇'▇ and at least "A" by Standard & Poor's.
(d) In the event the Collateral Agent becomes aware that a
Hedge Counterparty has defaulted in the payment when due of its obligations to
the Issuer under the related Hedging Agreement, the Collateral Agent shall
request the Issuer to make a demand on such Hedge Counterparty, or any
guarantor, if applicable, demanding payment by 12:30 p.m., New York time, on
such date (or by such time on the next succeeding Business Day if such knowledge
is obtained after 11:30 a.m., New York time). The Collateral Agent shall give
notice to the Representatives upon the continuing failure by such Hedge
Counterparty to perform its obligations during the two Business Days following a
demand made by the Issuer or such Hedge Counterparty.
(e) If at any time any Hedging Agreement becomes subject to
early termination due to the occurrence of an event of default or a termination
event, the Issuer and the Collateral Agent shall take such actions (following
the expiration of any applicable grace period) to enforce the rights of the
Issuer and the Collateral Agent thereunder and under the Security Agreement as
may be permitted by the terms of such Hedging Agreement and consistent with the
terms hereof and of the other Financing Documents, and shall apply the proceeds
of any such actions (including, without limitation, the proceeds of the
liquidation of any collateral pledged by the related Hedge Counterparty) to
enter into a replacement Hedging Agreement on substantially identical terms or
on such other terms as would satisfy the Rating Condition. Any costs
attributable to entering into a replacement Hedging Agreement which exceed the
sum of the proceeds of the liquidation of the terminated Hedging Agreement shall
be borne solely by the Issuer and shall constitute expenses payable under clause
(v) of Section 4.1(a) of the Security Agreement or clause (iv) of the Priority
of Acceleration Payments. In determining the amount payable under the terminated
Hedging Agreement, the Issuer will seek quotations from reference market-makers
who satisfy the definition of Hedge Counterparty herein. In addition, the Issuer
will use its best efforts to cause the termination of a Hedging Agreement to
become effective simultaneously with the entry into of a replacement Hedging
Agreement described as aforesaid.
SECTION 9.2. Backup Facility Loan Agreements. The Issuer may,
from time to time subsequent to the date hereof, enter into one or more Backup
Facility Loan Agreements conforming to the standards set forth in Appendix B
hereto; provided that, the Issuer shall obtain confirmation, on or prior to
entering into such agreement, that the Rating Condition would be satisfied after
giving effect to such additional Backup Facility Loan Agreement and shall
deliver to the Collateral Agent an executed copy of each such agreement.
SECTION 9.3. Increase in the Commitments under the Liquidity
Facility Loan Agreement. The Issuer may, from time to time subsequent to the
date hereof, increase the Liquidity Facility Commitment by up to $50 million, in
accordance with the terms of the
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Liquidity Facility Loan Agreement or by obtaining Liquidity Facility Commitments
from Enron pursuant to the Enron Support Agreement, provided, that the Issuer
shall (i) obtain confirmation, on or prior to effecting such increase, that the
Rating Condition would be satisfied after giving effect to such increase and
(ii) in the case where the Issuer obtains Liquidity Facility Commitments, notify
the Liquidity Facility Agent of the amount and payment terms under the related
Liquidity Commitment Note.
ARTICLE 10
REPAYMENTS AND REDEMPTIONS
SECTION 10.1. General Terms. Upon the repayment or redemption
of any Secured Obligation (whether such repayment or redemption is mandatory or
optional), the Issuers shall satisfy all applicable provisions under each of the
relevant Financing Documents.
SECTION 10.2. Redemption at the Option of the Issuers;
Election to Redeem.
(a) The Issuers may redeem Notes and/or the Support Notes at
the applicable Redemption Price and/or repay amounts drawn under the Liquidity
Facility and Backup Facility and pay termination amounts under Hedging
Agreements (exclusive of installments of principal or interest due on or prior
to such date, provided payment shall have been made or duly provided therefor)
as follows:
(i) the Class A Notes and Class B Notes, in a minimum
aggregate principal amount of $250,000, the amounts drawn under the
Backup Facility, Liquidity Facility, the Class C Notes and the Support
Notes (in whole or in part), on any Quarterly Payment Date, upon the
determination to do so by the Issuer (acting at the direction of the
General Partner), using amounts provided by Enron or other Persons
specifically for such purpose pursuant to Section 5.3 of the Enron
Support Agreement, in the following order: first, if after the Stated
Maturity of the Liquidity Facility, to reduce the amounts drawn under
the Liquidity Facility, second, ratably, (A) to redeem the Class A
Notes, (B) to reduce the amounts drawn under the Backup Facility, (C)
for termination payments to Hedge Counterparties in connection with any
termination of Hedging Agreements associated with any of the foregoing
clauses (A) or (B), and (D) to repay the amounts drawn under the
Liquidity Facility (without duplication of the preceding clause
"first") and third, to redeem the Class B Notes, the Class C Notes and
the Support Notes, in the order of seniority;
(ii) the Class A Notes and the Class B Notes (in whole or in
part) on any Quarterly Payment Date on or after the fifth anniversary
of the Closing Date but prior to the sixth anniversary of the Closing
Date in a minimum aggregate principal amount equal to $250,000 which
redemption need not be in order of seniority, upon the determination to
do so by the Issuer (acting at the direction of the General Partner)
through (A) the issuance of new Class A Notes, (B) drawings under the
Backup Facility in the case of a redemption of the Class B Notes and/or
(C) from applying amounts credited to the Uncommitted TIP Account, in
an aggregate principal amount equal to the aggregate Redemption Price
of the Class A Notes and Class B Notes being so redeemed; provided
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that (A) the Credit Support Tests and, if such redemption is not
effected in order of seniority, the Rating Condition, are satisfied
(after taking into account such proposed redemption or repayment); (B)
no Default has occurred and is continuing on such date; (C) (1) the
Senior Coverage Test is satisfied, (2) the Senior Overcollateralization
Ratio is at least equal to the Target Senior Overcollateralization
Ratio and (3) the Total Overcollateralization Ratio is at least equal
to the Target Total Overcollateralization Ratio (in each case, after
taking into account such proposed redemption or repayment); and (D) to
the extent the Collateral is comprised of less than 10 Project Loans,
no such Project Loan is a Defaulted Project Loan as of such date;
(iii) subject to the satisfaction of the conditions set forth
in Section 3.3 of the Indenture, on any Quarterly Payment Date on or
after the fifth anniversary of the Closing Date and from time to time
all or any part of the Class B Notes issued and Outstanding as of such
date in a minimum aggregate principal amount equal to $250,000, upon
the determination to do so by the Issuer (acting at the direction of
the General Partner), through (A) the issuance of a new Series of Class
B Notes with the same maturity and other terms, other than interest
rate, as the Class B Notes being redeemed, in a principal amount equal
to the principal of the Class B Notes so redeemed plus the Class B
Premium, if any, and/or (B) amounts provided by Enron or other Persons
specifically for such purpose pursuant to Section 5.3 of the Enron
Support Agreement (such redemption and reissuance, a "Class B
Refinancing") which will accrue interest at a fixed rate per annum set
forth in the related Supplemental Indenture; provided, that (A) the
Credit Support Tests and the Rating Condition are satisfied (after
taking into account such proposed redemption) and (B) no Default has
occurred and is continuing on such date; and
(iv) the Class C Notes (in whole or in part) on any Quarterly
Payment Date through the issuance of new Class A Notes, drawings under
the Backup Facility or from applying amounts credited to the
Uncommitted TIP Account upon the determination to do so by the Issuer
(acting at the direction of the General Partner) provided that (A) the
Credit Support Tests and the Rating Condition are satisfied (after
taking into account such proposed redemption) and (B) no Default has
occurred and is continuing on such date.
(b) No redemptions pursuant to Section 10.2(a) shall be
permitted unless the payment of the entire Redemption Price, including the
applicable Premium, is made on the Redemption Date.
(c) All repayments and redemptions pursuant to this Section
10.2 shall be made in accordance with the applicable provisions of the Financing
Documents.
SECTION 10.3. Mandatory Redemption.
(a) On each Quarterly Payment Date specified below, the
Issuers shall effect a mandatory redemption of the Notes (in whole or in part)
and a mandatory repayment of amounts drawn under the Backup Facility by applying
the amounts set forth below in accordance with the Priority of Payments:
(i) on the Quarterly Payment Date immediately following
an Investment Termination Date (such date, the
"Initial Redemption Date") that is not
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also a Tax Redemption Trigger Date and to the extent the Uncommitted
TIP Account Balance exceeds $250,000, and on each Quarterly Payment
Date thereafter until the Uncommitted TIP Account Balance is reduced to
zero, in an amount equal to the (A) Uncommitted TIP Account Balance on
the Initial Redemption Date less (B) amounts, if any, applied towards
the redemption of Class B Notes and/or Class C Notes in accordance with
Sections 10.2(a)(ii) and 10.2(a)(iv) on such Quarterly Payment Date;
provided, that, so long as any Sale of any Uncommitted TIP Investment
is deferred in accordance with Section 2.5(a) of the Security
Agreement, the amount referred to in the preceding clause (A) shall be
reduced by the aggregate principal amount of the Uncommitted TIP
Investments whose sales are so deferred. Any Premium which may be
payable in connection with this Section 10.3(a)(i) in accordance with
clause (c) below will be calculated based on the amount referred to in
the immediately preceding sentence;
(ii) on the Quarterly Payment Date following the Investment
Termination Date and on each Quarterly Payment Date thereafter if a
Commitment expires, terminates or is cancelled or reduced (in whole or
in part) and any such reduced Commitment exceeds the amount Allocated
under the Backup Facility for such Commitment, in an amount equal to
such excess amount; provided, that, so long as any Sale of a Committed
TIP Investment is deferred in accordance with Section 2.5(a) of the
Security Agreement the amount referred to in the immediately preceding
clause shall be reduced by the aggregate principal amount of the
Committed TIP Investments whose sales are so deferred.
(iii) on any Quarterly Payment Date upon the occurrence of (A)
an Equity Disposition and the Disposition Amount is required to be paid
pursuant to Article 8 of the Enron Support Agreement or (B) a
Refinancing, in an amount equal to the Note Redemption Amount; and
(iv) upon the occurrence of a Tax Event and the failure to
satisfy the Rating Condition, after giving effect to any amounts, if
any, provided under Section 5.1 of the Enron Support Agreement, by the
60th day following the occurrence of such event (such date, the "Tax
Redemption Trigger Date"), on the Quarterly Payment Date following such
Tax Redemption Trigger Date and on each Quarterly Payment Date
thereafter, in an amount equal to the Note Redemption Amount.
(b) The Class A Notes shall be subject to mandatory redemption
on any Quarterly Payment Date if a Subordinate Event of Default shall occur and
be continuing and the Holders of
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a Majority of the Class B Notes direct the Issuers to redeem the Class A Notes,
in whole but not in part, at par, provided that no such redemption shall be
permitted unless all amounts then owing under the Backup Facility and the
Liquidity Facility and all termination amounts paid under the Hedging Agreements
have been paid in full or will be paid in full through the anticipated proceeds
of a sale or liquidation of the Project Loans and the other Collateral and the
Collateral Agent has determined that the anticipated proceeds of a sale or
liquidation of the Project Loans and other Collateral would be sufficient, in
accordance with the Priority of Payments, to so redeem the Class A Notes and
repay all amounts owing under the Backup Facility and the Liquidity Facility and
make all Termination Payments payable under the Hedging Agreements.
(c) The redemption price for Class A Notes will be par
(including accrued and unpaid interest) plus the Class A Premium and for the
Class B Notes will be par (including accrued and unpaid interest) plus the Class
B Premium; provided, however, the redemption price for a redemption pursuant to
(x) Section 10.3(a)(i) resulting from the termination of the Investment Period
for reasons specified in clauses (iii) or (iv) of the definition of Investment
Period and (y) Sections 10.3(a)(ii) (to the extent the expiration, termination,
cancellation or reduction resulted from reasons other than those attributable to
the Issuer), 10.3(a)(iv) or Section 10.3(b), will be par (including accrued and
unpaid interest).
(d) Any mandatory redemption, repayment or Premium due as a
result of such redemption but not paid on such Redemption Date shall be payable
on each succeeding Quarterly Payment Date in accordance with the Priority of
Payments or the Priority of Acceleration Payments, as applicable, to the extent
Collateral Proceeds are available therefor, until all amounts payable have been
paid in full.
SECTION 10.4. Pro Rata Application. Unless otherwise specified
herein, all redemptions of Notes, Support Notes or amounts Outstanding under the
Backup Facility pursuant to this Article 10 shall be allocated on a pro rata
basis according to their respective Outstanding principal amounts among all
Outstanding Notes of a particular Class and amounts Outstanding under the Backup
Facility, without preference or priority of any kind among the Notes of such
Class (or any Series thereof) or among the Class A Notes and the Backup
Facility.
ARTICLE 11
LIMITED RECOURSE LIABILITY OF THE ISSUERS
SECTION 11.1. Limited Recourse Liability. It is expressly
agreed and understood that recourse for the obligations of the Issuers under
this Agreement and each other Financing Document to which either is a party
shall be limited to the Collateral and the Collateral Proceeds and that no
personal liability in respect of or recourse under or upon any obligation,
covenant or agreement contained in any Financing Document to which either is a
party or in this Agreement or under or upon any indebtedness secured by or
arising out of any Financing Document to which either is a party shall attach
to, be incurred by or be had against the Issuer, the Co-Issuer, any holder of an
equity interest in or officer or director as such, past, present or future, of
the Issuers or any shareholder, any holder of partnership interests, or any
affiliates, employees, agents and direct or indirect controlling persons of such
persons, or of any predecessor or successor of any thereof (each an "Exempt
Person"), whether by virtue of any
40
46
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or by any legal or equitable proceeding or otherwise. It is further
expressly agreed and understood that any and all such personal liability of
every name and nature either at common law or in equity or by statute or
constitution, of every such Exempt Person is hereby expressly WAIVED AND
RELEASED as a condition of, and as part of the consideration for, the issuance
of the Notes and the execution of this Agreement and the other Financing
Documents; provided, however, that nothing herein or in this Agreement shall be
taken to prevent the institution of proceedings against any Person to the extent
necessary to realize the benefit of the Collateral granted under the Security
Documents.
The limitations on recourse set forth in this Article 11 shall
survive termination of this Agreement and the payment and performance of all
obligations under the Financing Documents.
ARTICLE 12
PROVISIONS REGARDING THE ISSUERS
SECTION 12.1. Limitation on Benefit of Provisions regarding
the Issuers. The representations, warranties, covenants, agreements and Events
of Default made by or relating to the Issuers hereunder and under the other
Financing Documents shall be for the benefit of the Secured Parties and,
notwithstanding anything contained herein or therein to the contrary, no other
Person shall be entitled to take any action against the Issuers as a result of
the breach of, or failure to comply with, any such representation, warranty,
covenant, agreement or Event of Default.
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47
IN WITNESS WHEREOF, the parties have caused this Common Agreement to be duly
executed by their respective officers duly authorized as of the day and year
first above written.
ENRON INTERNATIONAL CPO, L.P.
By: Enron CPO Holdings, Inc.
its General Partner
By:
----------------------------------
Name:
Title:
ENRON INTERNATIONAL CPO, INC.
By:
----------------------------------
Name:
Title:
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
as Trustee
By:
----------------------------------
Name:
Title:
[NAME OF LIQUIDITY FACILITY AGENT]
as Liquidity Facility Agent
By:
----------------------------------
Name:
Title:
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
as Collateral Agent
By:
----------------------------------
Name:
Title:
42
48
Draft
8/7/98
Appendix A to Common Agreement
RULES OF INTERPRETATION
For all purposes of the Transaction Documents (as defined
below) or any other instrument or agreement that incorporates provisions of any
Transaction Document by reference, except as otherwise expressly provided or
unless the context otherwise requires:
(1) the terms not otherwise defined in any such
Transaction Document have the respective meanings assigned to them in this
Appendix A, and such definitions shall equally apply to the plural and singular
form of such terms;
(2) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with GAAP (as defined below);
(3) unless otherwise expressly specified, any agreement,
contract or document defined or referred to in any Transaction Document shall
mean such agreement, contract or document as in effect as of the Closing Date
(as defined below), as the same may thereafter be amended, supplemented or
otherwise modified from time to time;
(4) unless the context clearly intends to the contrary,
pronouns having a masculine or feminine gender shall be deemed to include the
other;
(5) any reference to any Person (as defined below) shall
include its permitted successors and assigns; and
(6) The terms "initially fund" or "initial funding" when
used in the context of a Project Loan shall include the acquisition by the
Issuer of an existing project loan.
DEFINITIONS
"Acceleration": The meaning specified in Section 5.2(a) of
the Common Agreement.
"Acceptable Credit Provider": A Person whose long-term,
unsecured debt is rated at least "A" by S&P and "A2" by ▇▇▇▇▇'▇ or whose
obligation is secured by a letter of credit by a Person whose long-term,
unsecured debt is rated at least "A" by S&P and "A2" by ▇▇▇▇▇'▇, in each case
at the time of the initial determination thereof under the Financing Documents,
except that, with respect to (i) clauses (8) and (9) and the final proviso of
the definition of Project Loan Criteria in this Appendix A, (ii) clause (ii) of
the definition of "Initial Equity" in this Appendix A and (iii) Section 14.8(i)
of the Enron Support Agreement, "Acceptable Credit Provider" shall mean a
Person whose long-term, unsecured debt is rated at least Investment Grade at
the time of the initial determination thereof.
49
"Account": Any of (i) the Uncommitted TIP Account, (ii) the
Committed TIP Account, (iii) the Collection Account, (iv) the Reserve Account,
(v) the Excess Spread Account, (vi) the Operating Account, (vii) the Expense
Reserve Account, (viii) the Distribution Obligation Escrow Account or (ix) the
Note Payment Account.
"Account Bank": Citibank, N.A., solely in its capacity as
account bank under the Security Agreement.
"Act": The meaning specified in Section 13.2 of the
Indenture.
"Actual Net Interest Margin": On any date is calculated by
dividing:
(a) the excess of (i) the product of (x) the Aggregate Project
Loan Balance and (y) the weighted average rate of interest of all Project Loans
over (ii) the product of (x) the greater of (A) zero and (B) the Outstanding
Amount of Class A Notes and Class B Notes and the Backup Facility Balance less
the Uncommitted TIP Account Balance and (y) the weighted average of the Class A
Note Interest Rate and Class B Note Interest Rate and the current rate of
interest payable (after giving effect to the applicable Hedging Agreements, if
any) on the Backup Facility Balance assuming the amounts Allocated thereunder
were drawn
by
(b) the Aggregate Project Loan Balance.
"Actual Senior Credit Support Percentage": On any date, the
amount, expressed as a percentage, calculated by dividing:
(a) Total Assets
by
(b) Net Senior Debt.
"Additional Transaction Documents": Any contracts or
agreements entered into by the Issuer or the Co-Issuer subsequent to the
Closing Date; provided, that, for purposes of Section 4.11(c) of the Common
Agreement, Additional Transaction Documents shall not include any Hedging
Agreements, Liquidity Facility Loan Agreement, Backup Facility Loan Agreements,
Replacement Management Agreements or Enron Support Documents entered into
subsequent to the Closing Date.
"Administrative Expenses": Any filing fees and taxes then due
and payable by the Issuer and/or the Co-Issuer (as certified by an Authorized
Officer of the Issuer to the Collateral Agent) and ordinary fees and expenses
owing by the Issuer to the Trustee, the Collateral Agent, other Representatives
and the TIP Advisors.
"Administrative Fee": The meaning specified in Section 7.01
of the Management Agreement.
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50
"Affiliate": With respect to a specified Person, (a) any
Person directly or indirectly owning, controlling or holding the power to vote
5% or more of the outstanding voting securities or other voting ownership
interests of the specified Person, (b) any Person directly or indirectly
controlling, controlled by or under common control with the specified Person or
(c) any general partner of the specified Person.
"Aggregate Book Value of the Issuer's Assets": The meaning
specified in Section 1.01 of the Management Agreement.
"Aggregate Project Loan Balance": The aggregate Project Loan
Balance for all Project Loans.
"Aggregate Senior Loan Balance": As of any date of
determination, the sum of (i) the Outstanding Amount of the Class A Notes, (ii)
the Liquidity Facility Balance and (iii) the Backup Facility Balance.
"Allocation": A commitment under the Backup Facility to fund
a particular Project Loan. "Allocated" shall have a correlative meaning.
"Antarctica": The geographic area that is within the
boundaries (as of the date hereof) of Antarctica.
"Assigned Agreements": The meaning specified in Section
2.1(a) of the Security Agreement.
"Assumed Loss Amount": With respect to any Defaulted Project
Loan or a defaulted Temporary Investment, an amount equal to the product of (a)
the Principal Balance of such Project Loan or Temporary Investment, as the case
may be, and (b) 100% minus the assumed recovery rate of (x) ___%, in the case
of Project Loans and (y) ___%, in the case of Temporary Investments.
"Assumed Reinvestment Rate": With respect to any Account or
fund securing the Secured Obligations, 4% per annum.
"Assumption Agreement": The meaning specified in Section 1.2
of the Enron Support Agreement.
"Assumptions": The meaning specified in Section 2.1(b)(ii) of
the Common Agreement.
"Authenticating Agent": With respect to the Notes or any
Class of the Notes, the Person designated by the Trustee, if any, to
authenticate such Notes on behalf of the Trustee pursuant to Section 6.4 of the
Indenture.
"Authorized Newspaper": The Luxemburger Wort or any successor
publication or substitute publication of similar circulation selected by the
Trustee.
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51
"Authorized Officer": With respect to the Issuer or the
Co-Issuer, any partner or Officer who is authorized to act for the General
Partner or any Officer who is authorized to act for the Co-Issuer, as
applicable, in matters relating to, and binding upon, the Issuer or the
Co-Issuer or, in any case, an Authorized Officer of the Program Manager (for so
long as the Program Manager is authorized to act for the Issuers pursuant to
the Management Agreement). With respect to the Program Manager, any Officer,
employee or agent of the Program Manager who is authorized to act for the
Program Manager in matters relating to, and binding upon, the Program Manager
with respect to the subject matter of the request, certificate or order in
question. With respect to the Trustee, a Trust Officer and with respect to any
other bank or trust company acting as trustee of an express trust or as
custodian, any Officer authorized to act for and on behalf of such bank or
trust company who has knowledge of and familiarity with the applicable subject.
With respect to any other Person, the officer authorized to act on behalf of
such Person by its Board of Directors or any other governing body of such
Person. Each party may receive and accept a certification of the authority of
any other party as conclusive evidence of the authority of any Person to act,
and such certification may be considered as in full force and effect until
receipt by such other party of written notice to the contrary.
"Available Committed Funds": The meaning specified under
"Funding Availability Test" in this Appendix A.
"Average Life Test": A test satisfied on any date of
determination if the Average Life Variance is between -1 and 1 years. The
"Average Life Variance" is calculated by dividing:
(a) The product of (x) the Aggregate Project Loan Balance and
(y) the Expected Project Loan Average Life less the Targeted Average
Life
by
(b) the greater of (x) __________ and (y) the Aggregate
Project Loan Balance.
"Targeted Average Life" as of any date of determination means
[________] less the number of years (or portions thereof) that have
elapsed from the Closing Date.
"Expected Project Loan Average Life" as of any date of determination
means the weighted average (by Project Loan Balance) of the Expected
Average Lives of each Project Loan as of the date of determination.
"Expected Average Life" with respect to each Project Loan is
determined on any date of determination by: first, for each principal
payment scheduled to be made subsequent to the date of determination,
multiplying (i) such principal payment by (ii) the number of years
from the date of determination until the date of such principal
payment; second, summing the results obtained from clause first; and
third, dividing such sum by the aggregate amount of the principal
payments referred to in clause first.
"Backup Facility": Collectively, one or more revolving credit
and term loan facilities provided to the Issuer pursuant to the Backup Facility
Loan Agreement(s) and any Funding Availability Commitments.
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52
"Backup Facility Agent": Each Person appointed as agent by
the Backup Lenders pursuant to each Backup Facility Loan Agreement and in the
case of Funding Availability Commitments provided under the Enron Support
Agreement, an agent appointed by Enron.
"Backup Facility Balance": The aggregate principal amount of
(i) Allocations and drawn amounts under the Backup Facility Loan Agreement(s)
and (ii) any drawn and undrawn amounts under the Funding Availability
Commitments.
"Backup Facility Commitment": Committed amounts by the Backup
Lenders under (i) all Backup Facility Loan Agreements and (ii) Funding
Availability Commitments.
"Backup Facility Loan Agreement": A loan agreement providing
for a Backup Facility, other than the Funding Availability Commitments, and
conforming to the standards set forth in Appendix B to the Common Agreement.
"Backup Lenders": The parties to the Backup Facility Loan
Agreements identified therein as "Lenders" and to the extent there are any
outstanding Funding Availability Commitments, Enron or an Enron Affiliate
providing such Commitment; provided, that in determining whether the Backup
Lenders with the requisite Backup Facility Balance have given any request,
demand, authorization, direction, notice, consent or waiver under any Financing
Document, any portion of the Backup Facility Balance attributable to funds
provided by Enron or any Enron Affiliate shall be disregarded and deemed not to
be outstanding.
"Backup Program Manager": Chase Texas or ___________________,
as applicable.
"Balance": At any time, with respect to Cash or Permitted
Investments in any Account at such time, the aggregate (i) current balance of
Cash, demand deposits, time deposits, certificates of deposit and federal
funds; (ii) principal amount of interest-bearing corporate and government
securities, money market accounts, and repurchase obligations; and (iii)
purchase price (but not greater than the face amount) of non-interest-bearing
government and corporate securities and commercial paper.
"Bankruptcy Code": The United States Bankruptcy Code, Title
11 of the United States Code, as amended.
"Base Case Financial Projections": Projections presented to
the Issuer by the sponsors of each individual Project Borrower as to the
revenues, expenses, debt service and cash available for debt service and
distributions of such Project Borrower over a period at least equal to the term
of the Project Loan to be made to such Project Borrower.
"Base Net Interest Margin": The percentage obtained from
Table 4 set forth in Annex A hereto (the "Base Net Interest Margin Table").
"Base Net Interest Margin Table": The meaning specified under
"Base Net Interest Margin" in this Appendix A.
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53
"Base Percentage": The meaning specified under "Required
Senior Project Credit Support Percentage" in this Appendix A.
"Beneficial Owner": Any Person owning an interest in a Global
Note as reflected on the books of the Depositary or on the books of a
Depositary Participant or on the books of an indirect participant for which a
Depositary Participant of the Depositary acts as agent.
"Board of Directors": With respect to any Person, the
directors of such Person duly appointed by the stockholders of such Person.
"Board Resolution": With respect to a limited partnership, a
resolution of the Board of Directors of the general partner of such limited
partnership; and with respect to a corporation, a resolution of the Board of
Directors of such corporation.
"Business Day": A day on which commercial banks and foreign
exchange markets settle payments in each of New York City, Houston, London,
Luxembourg and any other city in which the Corporate Trust Office is located
and, in the case of the final payment of principal of any Note, the place of
presentation of such Note.
"Calculated Asset Balance": (x) Prior to the Investment
Termination Date, the sum of (i) the Aggregate Project Loan Balance and (ii)
the Uncommitted TIP Account Balance and (y) on or after the Investment
Termination Date, the sum of (i)(A) the Aggregate Project Loan Balance on the
Investment Termination Date, (B) the Uncommitted TIP Account Balance and (C)
the Committed TIP Account Balance relating to any terminated, canceled, expired
or reduced Commitment minus the sum of (ii)(A) the aggregate amount of all
Commitments terminated, canceled, expired or reduced and (B) the sum of all
Note Redemption Amounts.
"Calculated Senior Debt Balance": The Calculated Asset Balance
minus (x) the sum of (i) all Hedging Proceeds, (ii) the principal amount of the
Class B Notes issued on the Closing Date, (iii) the principal amount of Class C
Notes issued in connection with the initial funding of a particular Project
Loan, (iv) the Class I Interests issued, (v) the GP Interests issued and (vi)
the Class II Interests issued on the Closing Date plus (y) the sum of (i) the
Deferred Issuance Costs and (ii) the principal amount, if any, of Class B Notes
(including any Class B Premium) and Class C Notes redeemed with Class A Notes,
with drawings under the Backup Facility or with amounts credited to the
Uncommitted TIP Account.
"Calculated Total Debt Balance": The Calculated Asset Balance
minus (x) the sum of (i) all Hedging Proceeds, (ii) the principal amount of
Class C Notes issued in connection with the initial funding of a particular
Project Loan, (iii) the Class I Interests issued, (iv) the GP Interests issued
and (v) the Class II Interests issued on the Closing Date plus (y) the sum of
(i) the Deferred Issuance Costs, (ii) the Class B Premium and (iii) principal
amount, if any, of Class C Notes redeemed with Class A Notes or with drawings
under the Backup Facility or with amounts credited to the Uncommitted TIP
Account.
"Cash": Such coin or currency of the United States of America
as at the time shall be legal tender for payment of all public and private
debts.
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"Cedel": Cedel Bank, societe anonyme, a corporation organized
under the laws of the Grand Duchy of Luxembourg.
"Certificate of Authentication": The meaning specified in
Section 2.1(a) of the Indenture.
"Certificated Note": The meaning specified in Section 2.1(c)
of the Indenture.
"Certificated Security": A Security that is represented by a
certificate.
"Chase Texas": Chase Bank of Texas, National Association.
"Class": All of the Notes having the same designation given
pursuant to Section 2.2 of the Indenture.
"Class A Make-Whole Premium": An amount equal to the excess,
if any, of the present value of the remaining principal and interest scheduled
to have been paid pursuant to the Note Payment Assumptions in respect to any
Class A Notes discounted at the Class A Present Value Rate over the amount of
principal of the Class A Notes to be prepaid.
"Class A Note Issuance Requirements": The conditions set
forth in Sections 2.9 and 3.2 of the Indenture.
"Class A Note Interest Rate": With respect to any Class A
Note of any Series, the rate per annum at which interest accrues on such Note
as set forth in the Indenture or in the Supplemental Indenture relating to such
Series (as applicable).
"Class A Notes": The Class A Senior Notes due 2018 of any
Series, having the Class A Note Interest Rate and the Stated Maturity set forth
in the Indenture or in the Supplemental Indenture relating to such Series (as
applicable).
"Class A Present Value Rate": (i) The as bid yield on United
States treasury securities with a maturity most closely correlating to the then
interpolated remaining average life of the Class A Notes immediately prior to
such prepayment (determined in accordance with the Note Payment Assumptions),
plus (ii) ___%.
"Class B Deferral Interest Rate": 1.5% in excess of the Class
B Note Interest Rate.
"Class B Deferred Interest": The meaning specified in Section
2.6(a) of the Indenture.
"Class B Note Interest Rate": With respect to any Class B
Note of any Series, the rate per annum at which interest accrues on such Note
as set forth in the Indenture or in the Supplemental Indenture relating to any
Class B Refinancing.
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"Class B Notes": The ___% Class B Senior Subordinated Notes
due 2018, or in the case of a Class B Refinancing, the Class B Notes having the
Class B Note Interest Rate set forth in the Supplemental Indenture relating to
such Class B Refinancing.
"Class B Premium":
(a) Prior to the fifth anniversary of the Closing Date, an
amount equal to (i) the excess, if any, of (A) the present value of
the remaining principal, interest and Fixed Rate Premium scheduled to
have been paid pursuant to the Note Payment Assumptions in respect of
the Class B Notes, assuming such Class B Notes were to be redeemed on
the fifth anniversary of the Closing Date at an amount equal to par
plus the product of (I) the amount of principal on the Class B Notes
to be prepaid and (II) ___% of the Class B Note Interest Rate,
discounted at the Class B Present Value Rate, over (B) the amount of
principal on the Class B Notes to be prepaid and the applicable Fixed
Rate Premium plus (ii) the applicable Fixed Rate Premium; and
(b) on or after the fifth anniversary of the Closing Date, an
amount equal to the applicable Fixed Rate Premium.
"Class B Present Value Rate": (i) The as bid yield on United
States treasury securities with a maturity equal to the then interpolated
remaining average life of the Class B Notes, assuming the applicable redemption
would occur on the fifth anniversary of the Closing Date, immediately prior to
the applicable prepayment, plus (ii) ____%.
"Class B Refinancing": The meaning specified in Section
10.2(a)(iii) of the Common Agreement.
"Class C Deferred Interest": The meaning specified in Section
2.6(a) of the Indenture.
"Class C Issuance": The meaning specified in Section 2.9(a)
of the Indenture.
"Class C Issuance Date": The meaning specified in Section
2.9(a) of the Indenture.
"Class C Note Interest Rate": With respect to any Class C
Note, the rate per annum at which interest accrues on such Note equal to ___%.
"Class C Note Purchase Commitment": The meaning specified in
the Enron Support Agreement.
"Class C Notes": The Class C Subordinated Notes due 2018
having the Class C Note Interest Rate and the Stated Maturity set forth in the
Indenture.
"Class C Principal Distributable Amount": With respect to a
Due Period, the amount equal to the principal proceeds received during such Due
Period multiplied by a fraction, the numerator of which equals the principal
amount of the Class C Notes and the denominator of which equals the aggregate
amount of funded capitalization of the Issuer.
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"Class I Interests": The meaning specified in the Partnership
Agreement.
"Class I Stage Funding": Funding of Class I Interests after
the Closing Date.
"Class I Stage Funding Commitment": The commitment of
Acceptable Credit Providers to provide Class I Stage Funding.
"Class I Stage Funding Commitment Letter": A letter evidencing
a Class I Stage Funding Commitment [in the form set forth in Annex [ ] to the
Partnership Agreement.]
"Class I Trigger Event": (i) The removal of the Program
Manager and the General Partner without cause, with the concurrent approval of
the Required Lenders, which would (a) cause the Investment Period to terminate
and (b) terminate Enron's obligation to use commercially reasonable efforts to
notify the Issuer of opportunities to make loans to projects developed or
acquired by Enron or Enron Affiliates and located in the El Regions, or (ii)
removal of the Program Manager and the General Partner without cause (without
the approval of the Required Lenders) if, concurrently, (a) Enron's obligation
to use commercially reasonable efforts to notify the Issuer of opportunities to
make loans to projects developed or acquired by Enron or Enron Affiliates and
located in the El Regions is terminated, (b) the GP Interest and the funded
Class II Interests are, if Enron so elects, purchased from Enron or Enron
Affiliates for cash in the amount equal to Enron's aggregate capital
contributions in respect of such GP Interest and funded Class II Interests, (c)
the unfunded portion of Enron's commitment in respect of Class II Interests is
assumed by an Acceptable Credit Provider, (d) Enron's obligation to provide
credit support and any unfunded commitment in respect thereof (other than
funded Class C Notes and Support Notes) under the Enron Support Agreement to
pay or cause to be paid amounts in respect of Quarterly Project Distributions
and Project Distributions Reserved is replaced by credit support of equivalent
value without further liability to Enron, (e) the agreement of Enron not to
sponsor a Competing Issuer for a specified period time is terminated, and (f)
the then effective ratings of the Class A Senior Notes and Class B Senior
Subordinated Notes are reaffirmed by ▇▇▇▇▇'▇ and S&P.
"Class II Interests": The meaning specified in the
Partnership Agreement.
"Clearing Agency": An organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.
"Clearing Corporation": The meaning specified in Section
8-102(a)(5) of the UCC.
"Closing Date": __________, 1998.
"Code": The United States Internal Revenue Code of 1986, as
amended.
"Co-Issuer": Enron International CPO, Inc., a corporation
organized under the laws of the State of Delaware.
"Collateral": The meaning specified in Section 2.1(a) of the
Security Agreement.
"Collateral Account": Any of the Accounts pledged by the
Issuer to the Collateral Agent as part of the Collateral.
"Collateral Agent": Chase Texas solely in its capacity as
collateral agent for the Secured Parties under the Security Agreement and the
other Financing Documents.
"Collateral Proceeds": With respect to any Quarterly Payment
Date, the sum of (i) all payments of interest received by the Issuer in Cash
during the related Due Period on the Project Loans, (ii) except as otherwise
provided in Section 3.3(b) of the Security Agreement with respect to an event
of default that has occurred and is continuing on a Committed TIP Investment,
all payments of interest received in Cash during the related Due Period on the
Temporary Investments, (iii) all accrued interest on any Project Loan or
Temporary Investment received by the Issuer as a result of the Sale of such
Project Loan or Temporary Investment during such Due Period, (iv) all premiums
(including prepayment premiums) received by the Issuer during such Due Period
on the Project Loans and Temporary Investments, (v) if after the Investment
Termination Date, all payments of principal (including prepayments) received by
the Issuer during such Due Period on Project Loans and Temporary Investments
credited to the Uncommitted TIP Account, (vi) all amendment and waiver fees,
all late payment fees and all other fees and commissions received in Cash
during such Due Period in connection with Project Loans and the Temporary
Investments other than loan origination fees or upfront fees (excluding expense
reimbursements) credited to the Uncommitted TIP Account, (vii) if after the
Investment
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57
Termination Date, any amount received by the Issuer during such Due Period from
the sale or other disposition of Project Loans and Temporary Investments
credited to the Uncommitted TIP Account, (viii) any amount received by the
Issuer pursuant to the Hedging Agreements during such Due Period, other than
Hedging Proceeds received during the Investment Period, (ix) all earnings from
Eligible Investments made with amounts credited to the Accounts (other than any
amounts credited to the Reserve Account, the Excess Spread Account and the
Distribution Obligation Escrow Account) during such Due Period, (x) proceeds
from the Sale of Committed TIP Investments in connection with any mandatory
redemption pursuant to Section 10.3(a)(ii) of the Common Agreement, (xi)
payments received pursuant to the terms of the Enron Support Agreement other
than payments made under Sections 4.1, 4.2, 4.3, 5.4 and 5.5 thereunder and
(xii) amounts which remain credited to the Operating Account at the end of the
immediately preceding Due Period, other than amounts applied towards uses
specified in Section 3.7 of the Security Agreement for the next following Due
Period; provided, that, without duplicating the foregoing, amounts referred to
in clauses (i) through (vii) above shall include amounts received by the Issuer.
"Collection Account": The account designated the "Collection
Account" and established pursuant to Section 3.2 of the Security Agreement
which account shall initially be account number [________] and shall include
any successor or replacement accounts thereof.
"Commission": The U.S. Securities and Exchange Commission.
"Commitment": A legally binding commitment to make a Project
Loan as determined by legal counsel to the Program Manager (subject to the
satisfaction of customary conditions precedent, including any of the Qualifying
Criteria the satisfaction of which may be deferred to any date on or prior to
the initial funding of such Project Loan). "Committed" shall have a
correlative meaning.
"Committed TIP Account": The account designated the
"Committed TIP Account" and established pursuant to Section 3.3(b) of the
Security Agreement which account shall initially be account number
[______________] and shall include any successor or replacement accounts
thereof.
"Committed TIP Account Balance": (i) With respect to
non-defaulted Committed TIP Investments credited to the Committed TIP
Investment, the principal balance of investments credited to the Committed TIP
Account, except that with respect to Committed TIP Investments credited to the
Committed TIP Account which are described in clause (c) of the Committed TIP
Investment Policies, only [__]% of the principal balance of each such
investment shall be deemed credited to the Committed TIP Account and (ii) with
respect to defaulted Committed TIP Investments on deposit in the Committed TIP
Account, only [__]% of the principal balance of each such investment shall be
deemed credited to the Committed TIP Account.
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"Committed TIP Investment": The meaning specified under the
definition of "Committed TIP Investment Policy" in this Appendix A.
"Committed TIP Investment Policies": Amounts credited to or
re-invested in the Committed TIP Account shall be invested in (a) U.S.
Government Securities, (b) TIP Eligible Investments and (c) Dollar-denominated
senior term loans, revolving credits or other senior liabilities of United
States borrowers or corporate issuers located in countries whose long-term
sovereign debt obligations are rated at least "Aa2" by ▇▇▇▇▇'▇ or at least "AA"
by S&P, in each case, with direct or implied ratings of at least "Baa3" by
▇▇▇▇▇'▇ and "BBB-" by S&P (each of the investments described in the foregoing
clauses (a), (b) and (c), a "Committed TIP Investment"). All Committed TIP
Investments shall mature on the earlier of, or prior to, one year from the date
that they were acquired, or as to the relevant portion of such amounts and
after giving effect to amounts Allocated under the Backup Facility the date(s)
on which the Issuer is legally obligated to fund drawdowns under the related
Project Loans in accordance with the agreed upon drawdown schedules. The
investments described in the foregoing clause (c) shall satisfy the following
criteria:
(i) The balance of all such investments shall be zero by
the end of the 12-month period beginning on the Closing Date;
(ii) Such investments shall have a TIP Diversity Score of
at least 20 and an Industry Concentration Factor no greater than 10%
while complying with the restrictions in Section 2.5(a)(i)(A) of the
Security Agreement with respect to the Sale of Collateral; and
(iii) With respect to maturing investments, such amount
will be reinvested in Committed TIP Investments described in clause
(a) or clause (b) of the Committed TIP Investment Policies;
provided, that Committed TIP Investments shall not include any
interest-only security, any security purchased at a price in excess of
100% of the par value thereof, unless such security is non-callable to
maturity (unless callable with a make-whole premium), or any security
whose repayment is subject to substantial non-credit related risk as
determined in the sole judgment of the Program Manager.
"Common Agreement": The Common Agreement dated as of
____________, 1998 among the Issuers, the Collateral Agent and the
Representatives.
"Comparable Countries": The meaning specified in Section 2.02
of the Management Agreement.
"Comparable Debt": The meaning specified in Section 2.02 of
the Management Agreement.
"Competing Issuer": The meaning specified in Section 1.2 of
the Enron Support Agreement.
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"Continent": Each of Antarctica, Africa, Asia, Australasia,
Europe, North America and South and Central America.
"Controlling Class": As of a date of determination, (A) if
Class A Notes are outstanding at such time, the Class A Notes and (B) if Class
B Notes, but no Class A Notes, are outstanding at such time, the Class B Notes,
and (C) if Class C Notes, but no Class A Notes or Class B Notes, are
outstanding at such time, the Class C Notes other than Class C Notes held by
Enron or an Enron Affiliate.
"Corporate Trust Office": The principal corporate trust
office of the Trustee, currently located at ▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: Global Trust Services - Enron International CPO, L.P.,
telephone number ▇▇▇-▇▇▇-▇▇▇▇, or such other address as the Trustee may
designate from time to time by notice to the Noteholders, the Program Manager
and the Issuers or the principal corporate trust office of any successor
Trustee.
"Coverage Ratio Condition": The meaning specified in
paragraph (7) under "Project Loan Criteria" in this Appendix A.
"Credit Support Test Commitment": A commitment made by Enron
pursuant to Section 5.2 of the Enron Support Agreement to satisfy any Credit
Support Test.
"Credit Support Tests": The ▇▇▇▇▇'▇ Credit Support Test and
the S&P Credit Support Test, as applicable.
"Currency Hedging Arrangement": With respect to any Project
Loan or an Intermediate Funding Loan denominated in a currency other than U.S.
Dollars, one or more currency hedging agreements entered into between an
Intermediate Funding Entity and an Acceptable Credit Provider, such that
payments anticipated to be made from such Project Borrower or Intermediate
Funding Entity, as applicable, are converted into U.S. dollars at an agreed
upon exchange rate and any residual exposure relating to any breakage and
termination costs of such hedging agreement are indemnified by an Acceptable
Credit Provider.
"Debt Rate": The meaning specified under "Target Note
Redemption Amount" in this Appendix A.
"Default": Any Event of Default or any occurrence that is, or
with notice or the lapse of time or both would become, an Event of Default.
"Defaulted Interest": Any interest due and payable in respect
of any of the Notes which is not punctually paid or duly provided for on the
applicable Quarterly Payment Date or at the Stated Maturity thereof and which
remains unpaid.
"Defaulted Project Loan": Any Project Loan as to which,
pursuant to the related Underlying Instruments, there has occurred and is
continuing any default or event of default for failure to pay which entitles
the holders of such Project Loan to accelerate the maturity (whether by
mandatory prepayment or otherwise) of all or a portion of the principal amount
of such Project Loan (with respect to which default or event of default the
applicable grace or cure periods has lapsed).
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"Deferral Event": An event which shall occur on the fourth
Quarterly Payment Date (which need not be consecutive) on which payment of
interest on the Class B Notes is deferred.
"Deferred Issuance Costs": With respect to (i) the Closing
Date, Initial Issuance Expenses; (ii) any Quarterly Payment Date on or prior to
the Investment Termination Date, the Initial Issuance Expenses plus the
Transaction Expenses minus any upfront fees received from Project Borrowers;
and (iii) any Quarterly Payment Date after the Investment Termination Date, the
greater of (x) the Deferred Issuance Costs on the prior Quarterly Payment Date
minus one-fourth of the Deferred Issuance Costs on the Investment Termination
Date and (y) zero.
"Depositary": With respect to the Notes issued in the form of
one or more Global Notes, the Person designated as Depositary pursuant to
Section 2.2(e) of the Indenture or any successor thereto pursuant to the
applicable provisions of the Indenture.
"Depositary Participant": A broker, dealer, bank or other
financial institution or other Person for whom from time to time the Depositary
effects book-entry transfers and pledges of notes deposited with the
Depositary.
"Designated Enron Ownership Interest": The meaning specified
in Section 1.2 of the Enron Support Agreement.
"Designation Letter": A letter substantially in the form of
Exhibit F to the Common Agreement.
"Determination Date": The last Business Day of a Due Period.
"Disposition Amount": With respect to a Project Loan that is
the subject of an Equity Disposition or a Refinancing, an amount equal to the
sum of the principal of and accrued interest on such Project Loan plus any
premium (in the case of a fixed rate Project Loan) received by the Issuer with
respect to such Project Loan.
"Distribution Obligation Escrow Account": The account to be
designated the "Distribution Obligation Escrow Account" and to be established
pursuant to Section 3.8 of the Security Agreement and shall include any
replacement or successor account.
"Diversity Score": On any date of determination, a score
calculated by summing each of the Regional Diversity Scores, calculated as
follows:
(i) An "Average Par Amount" is calculated by dividing the
Aggregate Project Loan Balance by the number of Project Borrowers.
(ii) A "Relative Contribution" is calculated for each country
by adding the lesser of (A) (w) ___ if there is one Project Borrower
in such country, (x) ___ if there are two Project Borrowers in such
country, (y) ___ if there are three Project Borrowers in such country
and (z) ___ if there are four or more Project Borrowers in such
country; and (B) the Project Loan Balance for such country divided by
the Average Par Amount.
(iii) An "Aggregate Regional Equivalent Unit Score" is then
calculated for each of the six regions (i.e., Latin America, Central
Asia, Asia Pacific, Africa and the Middle East, Eastern Europe and
the Caribbean) by summing the Relative Contributions for each country
in the region; provided that for purposes of calculating the Diversity
Score, any
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country whose unguaranteed, unsecured and otherwise unsupported
long-term sovereign debt obligations have a ▇▇▇▇▇'▇ Rating of at least
"Baa3" will be treated as a separate region.
(iv) A "Regional Diversity Score" is then established for
each region (other than Latin America if there is more than one Latin
American country represented in the portfolio) by reference to Table 6
hereto for the related Aggregate Regional Equivalent Unit Score. If
the Aggregate Regional Equivalent Unit Score falls between any two
scores shown in such table, then the Regional Diversity Score shall be
interpolated from the two Diversity Scores in such table.
(v) If there are debt obligations of more than one Latin
American country represented in the portfolio, the Regional Diversity
Score for Latin America is calculated under the following formula:
Latin America Regional Diversity Score = ((unadjusted Regional
Diversity Score minus 1) divided by 2) + 1
where the unadjusted Regional Diversity Score is established by
reference to Table 6 for the related Aggregate Regional Equivalent
Unit Score with respect to Latin America.
"Dollar" or "$": A dollar or other equivalent unit in such
coin or currency of the United States of America as at the time shall be legal
tender for all debts, public and private.
"DTC": The Depository Trust Company, a New York corporation.
"Due Date": Each date on which a Payment is due on a Project
Loan or a Permitted Investment.
"Due Period": With respect to any Quarterly Payment Date, the
calendar quarter ending immediately prior to such Quarterly Payment Date or, in
the case of the initial Due Period, the period commencing on (but excluding)
the Closing Date and ending on the last day of the calendar quarter ending
immediately prior to the initial Quarterly Payment Date or, in the case of a
Due Period that is applicable to the Quarterly Payment Date relating to the
Stated Maturity of any Note, the period commencing on (and including) the day
immediately following the last day of the prior Due Period and ending on the
date of such Stated Maturity.
"EI" or "Enron International": The legal persons, business,
operations, assets, management and operating personnel and related functions of
Enron that conduct the development, financing, construction and operation of
projects in Permitted Industries in the EI Regions.
"Election Notices": The meaning specified in Section 2.3 of
the Enron Support Agreement.
"Eligible Investments": Any Dollar-denominated investment
made using amounts credited to any Account (other than the TIP Accounts) that,
at the time it is delivered to the
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Collateral Agent or the Trustee, as the case may be (directly or through a
Securities Intermediary), is one or more of the following obligations or
securities:
(i) direct Registered obligations of, and Registered
obligations the timely payment of principal and interest on which is
fully and expressly guaranteed by, the United States of America or any
agency or instrumentality of the United States of America the
obligations of which are expressly backed by the full faith and credit
of the United States of America;
(ii) demand and time deposits in, certificates of deposit
of, bankers' acceptances payable within 90 days of issuance by, or
Federal funds sold by, any depository institution or trust company
incorporated under the laws of the United States of America or any
state thereof and subject to supervision and examination by Federal
and/or state banking authorities so long as the commercial paper
and/or the debt obligations of such depository institution or trust
company (or, in the case of the principal depository institution in a
holding company system, the commercial paper or debt obligations of
such holding company) at the time of such investment or contractual
commitment providing for such investment have a credit rating of not
less than "A2" by Moody's or "A" by Standard & Poor's, in the case of
long-term debt obligations, or "P-1" by Moody's or "A-1" by Standard &
Poor's in the case of commercial paper and short-term debt
obligations;
(iii) unleveraged repurchase obligations with respect to
(a) any security described in clause (i) above or (b) any other
Registered security issued or guaranteed by an agency or
instrumentality of the United States of America (in each case without
regard to the Stated Maturity of such security), in either case
entered into with a depository institution or trust company (acting as
principal) described in clause (ii) above or entered into with a
corporation (acting as principal) whose long-term rating is not less
than "A2" by Moody's or "A" by Standard & Poor's or whose short-term
credit rating is "P-1" by Moody's or "A-1" by Standard & Poor's at the
time of such investment;
(iv) Registered debt securities bearing interest or sold
at a discount issued by any corporation incorporated under the laws of
the United States of America or any state thereof that have a credit
rating of not less than "A1" by Moody's or "A+" by Standard & Poor's
at the time of such investment or contractual commitment providing for
such investment;
(v) commercial paper or other short-term obligations with
a maturity of not more than 90 days from the date of issuance and
having at the time of such investment a credit rating of not less than
"P-1" by Moody's or "A-1" by Standard & Poor's; and
(vi) a Reinvestment Agreement issued by any bank (if
treated as a deposit by such bank), or a Registered Reinvestment
Agreement issued by any insurance company or other corporation or
entity, in each case that has a credit rating of not less than "P-1"
by Moody's or "A-1" by Standard & Poor's;
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and, in each case, with a Stated Maturity (giving effect to any applicable
grace period) no later than the Quarterly Payment Date next following the Due
Period in which the date of investment occurs; provided that Eligible
Investments shall not include any interest-only security, any security
purchased at a price in excess of 100% of the par value thereof, unless such
security is non-callable to maturity (unless callable with a make-whole
premium) or any security whose repayment is subject to substantial non-credit
related risk as determined in the sole judgment of the Program Manager.
"Eligible Merchant Project": A business enterprise that (A)
is not an Eligible Project under clause (A) of the definition of "Eligible
Project", (B) is reasonably expected to be competitive on a delivered cost
basis with other business enterprises providing similar services in the same
market and (C) notwithstanding the absence of Integrated Contractual
Arrangements, has sufficient access to required feedstocks and offtake markets.
"Eligible Project": A business enterprise that generates
operating revenues from a Permitted Industry and that (A) has cash flow based
primarily upon or is subject to Integrated Contractual Arrangements or (B) is
an Eligible Merchant Project (each of the immediately preceding clauses (A) and
(B) is hereinafter referred to as an "Eligible Project Category" and
collectively referred to as the "Eligible Project Categories"). In the event a
project has (A) some portion of its cash flow based upon Integrated Contractual
Arrangements and (B) some portion of its cash flow that is not attributable to
arrangements or agreements contemplated by Integrated Contractual Arrangements,
(x) if the Coverage Ratio Condition can be satisfied based solely on the
portion of such project's cash flow attributable to Integrated Contractual
Arrangements, (y) if at least 75% of projected cash flow of such project
available for debt service on an annual basis is attributable to Integrated
Contractual Arrangements or (z) if projected cash flow of such project
available for debt service on an annual basis is based on Integrated
Contractual Arrangements for a specified period during which it is anticipated
that at least 75% of such Project Loan (including interest thereon) will be
repaid, then in each such case, such project will be deemed to be an Eligible
Project under the relevant Eligible Project Category and will not be deemed to
be an Eligible Merchant Project (provided that, for purposes of clauses (y) and
(z) of this sentence, projections together with the Independent Engineer's
review of such projections with respect to projected cash flows that are not
attributable to any Integrated Contractual Arrangements contemplated by such
clause will be undertaken as if such project were an Eligible Merchant
Project).
"Eligible Project Category": The meaning specified under
"Eligible Project" in this Appendix A.
"Enron": Enron Corp., a corporation organized under the laws
of the State of Oregon.
"Enron Affiliate": An Affiliate of Enron.
"Enron Class II Purchase Commitment": The meaning specified
in Section 3.1 of the Enron Support Agreement.
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"Enron Competitor": Any Person other than a Financial
Institution that is engaged in the development, operation or ownership of
international energy, electric, water or other infrastructure projects in any
Permitted Industry, or which otherwise has any significant portion of its
operations in the natural gas, crude oil, coal, electricity, water or other
energy related industries (or risk management activities related thereto).
"Financial Institution" shall mean any Person whose principal business is that
of a bank holding company, insurance holding company, savings and loan holding
company, bank, insurance company, savings and loan company, investment company
or private or governmental employee benefit plan, together, in each case, with
their respective subsidiaries, controlled affiliates and affiliates under
common control.
"Enron Credit Counterparty": An Enron Affiliate (i) that has
and maintains a credit rating at least equivalent to Enron's credit rating at
the time such Enron Affiliate makes a commitment, (ii) whose commitment is
guaranteed by Enron or (iii) whose commitment is supported by a letter of
credit issued by an Acceptable Credit Provider.
"Enron Distributions": The meaning specified in Section 1.2
of the Enron Support Agreement.
"Enron International CPO, L.P.": Enron International CPO,
L.P., a limited partnership organized under the laws of the State of Delaware.
"Enron Ownership Percentage": With respect to a Project
Borrower, the portion, expressed as a percentage, owned by Enron or an Enron
Affiliate of the following: (i) shares, if such Project Borrower is a
corporation, (ii) partnership interests, if such Project Borrower is a
partnership or (iii) membership interests, if such Project Borrower is a
limited liability company.
"Enron Ownership Requirement": The requirements set forth in
paragraph (4) of the definition of "Project Loan Criteria" and paragraph (5) of
the definition of "Portfolio Criteria" in this Appendix A.
"Enron Support Agreement": The Support Agreement dated as of
____________, 1998 between the Issuer and Enron.
"Enron Support Documents": The Enron Support Agreement, any
Assumption Agreements, Election Notices, Liquidity Notes, Funding Availability
Notes, certificates evidencing Class I Interests and guaranties or letters of
credit, if any, delivered by Enron, an Enron Credit Counterparty or an
Acceptable Credit Provider thereunder.
"Entitlement Holder": A Person identified in the records of a
Securities Intermediary as the Person having a Securities Entitlement against
the Securities Intermediary.
"Entitlement Order": A notification communicated to a
Securities Intermediary directing transfer or redemption of a Financial Asset
to which the Entitlement Holder has a Security Entitlement.
"Equity Disposition": Has the meaning specified in Section
1.2 of the Enron Support Agreement.
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"ERISA": The United States Employee Retirement Income
Security Act of 1974, as amended.
"ERISA Plan": An "employee benefit plan" (as defined in
Section 3(3) of ERISA) which is subject to the provisions of Part 4 of Title I
of ERISA, and any entity whose underlying assets include the assets of any such
plan.
"Euroclear": ▇▇▇▇▇▇ Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Europe": The geographic areas that are within the boundaries
(as of the date hereof) of Albania, Andorra, Austria, Belarus, Belgium, Bosnia
and Herzegovina, Bulgaria, Croatia, the Czech Republic, Denmark, Estonia,
Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Latvia,
Liechtenstein, Lithuania, Luxembourg, the Former Yugoslav Republic of
Macedonia, Malta, Moldova, Monaco, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ and Montenegro, Slovakia, Slovenia, Spain,
Sweden, Switzerland, Turkmenistan, Ukraine, United Kingdom, Vatican City and
Yugoslavia (former).
"Event of Default": The meaning specified in Section 5.1 of
the Common Agreement.
"Excess Spread Account": The account designated the "Excess
Spread Account" and established pursuant to Section 3.5 of the Security
Agreement which account shall initially be account number ______ and shall
include any successor or replacement accounts thereof.
"Excess Spread Account Balance": Amounts credited to or
deemed to be credited to the Excess Spread Account pursuant to Section 3.5 of
the Security Agreement.
"Exchange Act": The United States Securities Exchange Act of
1934, as amended, and the rules promulgated thereunder.
"Exempt Person": The meaning specified in Section 11.1 of the
Common Agreement.
"Expense Reserve Account": The account designated the
"Expense Reserve Account" and established pursuant to Section 3.6 of the
Security Agreement and shall include any replacement or successor account.
"Extraordinary Expenses": Reasonable expenses of the Issuer
not otherwise paid pursuant to clauses (i) through (xi)(F) of the Priority of
Payments.
"Final Support Notice": The meaning specified in Section 4.4
of the Enron Support Agreement.
"Final Termination Date": The date on which all amounts due
and payable by the Issuers in respect of the Secured Obligations have been paid
in full.
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"Financial Asset": Except as otherwise provided in Section
8-103 of the UCC: (a) a Security; (b) an obligation of a Person or a share,
participation or other interest in a Person or in property or an enterprise of
a Person, which is, or is of a type, dealt in or traded on financial markets,
or which is recognized in any area in which it is issued or dealt in as a
medium for investment; or (c) any property that is held by a Securities
Intermediary for another Person in a Securities Account if the Securities
Intermediary has expressly agreed with the other Person that the property is to
be treated as a financial asset under Article 8 of the UCC.
"Financial Closing Date": With respect to a Project Loan or
one or more related Intermediate Funding Loans, the date on which all
conditions precedent to the initial funding thereto have been satisfied.
"Financial Institution": The meaning specified under "Enron
Competitor" in this Appendix A.
"Financing Documents": The Common Agreement, the Security
Documents, the Intercreditor Agreement, the Liquidity Facility Loan Agreement,
the Backup Facility Loan Agreement(s), the Indenture, the Class A Notes, the
Class B Notes, the Class C Notes, the Support Notes, the Hedging Agreements,
the Class I Stage Funding Commitment Letters and the Enron Support Documents.
"Financing Statements": Financing statements relating to the
Collateral naming the Issuer as debtor and the Collateral Agent as secured
party.
"Fixed Rate Premium": With respect to the Initial Class B Notes
to be redeemed, the product of (A) the amount of principal of such Class B Notes
and (B) the applicable percentage of the Class B Note Interest Rate for the
periods set forth below:
Number of years elapsed from Closing
Date (rounded up to the nearest year) Applicable Percentage
------------------------------------- ----------------------
0 to 6 %
7
8
9
10
thereafter
"Funding Availability Commitment": The meaning specified in
Section 1.2 of the Enron Support Agreement
"Funding Availability Note": Each of the notes representing
amounts drawn under Funding Availability Commitments in substantially the form
set forth in Exhibit __ to the Enron Support Agreement.
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"Funding Availability Shortfall Amount": The meaning specified
in Section 3.3(b) of the Security Agreement.
"Funding Availability Test": A test satisfied on any date of
determination if the aggregate amount of unfunded Commitments (including the
Commitment relating to the Project Loan to be made) is less than or equal to
Available Committed Funds as of such date. "Available Committed Funds" means
the sum of (i) the Committed TIP Account Balance and (ii) the undrawn portion
of the Backup Facility.
"GAAP": With respect to any Person, generally accepted
accounting principles in the U.S., as in effect from time to time.
"General Intangibles": The meaning specified in Section 9-106
of the UCC.
"General Partner": Enron CPO Holdings, Inc., a special
purpose bankruptcy remote corporation organized under the laws of the State of
Delaware, which is an indirect, wholly-owned subsidiary of Enron.
"Global Notes": The meaning specified in Section 2.1(b) of
the Indenture.
"GP Interests": The meaning specified in Section ____ of the
Partnership Agreement.
"Grant": To grant, bargain, sell, warrant, alienate, remise,
demise, release, convey, assign, transfer, mortgage, pledge, create or grant a
security interest in and right of set-off against, deposit, set over and
confirm. A Grant of the Pledged Securities, or of any other instrument, shall
include all rights, powers and options (but none of the obligations) of the
granting party thereunder, including without limitation the immediate
continuing right to claim for, collect, receive and receipt for principal and
interest payments in respect of the Pledged Securities or such other
instruments, and all other Monies payable thereunder, to give and receive
notices and other communications, to make waivers or other agreements, to
exercise all rights and options, to bring Proceedings in the name of the
granting party or otherwise, and generally to do and receive anything that the
granting party is or may be entitled to do or receive thereunder or with
respect thereto.
"Hedge Counterparty": Any counterparty (a) whose Reference
Obligations are rated (or whose counterparty rating is) at least "A2" by
Moody's and at least "A" by Standard & Poor's, (b) whose obligations under the
relevant Hedging Agreement are absolutely and unconditionally guaranteed by an
Affiliate of such counterparty if such Affiliate's Reference Obligations are
rated at least "A2" by Moody's and at least "A" by Standard & Poor's or (c)
that agrees to provide Hedge Counterparty Credit Support.
"Hedge Counterparty Credit Support": The agreement by a Hedge
Counterparty to cause to become effective, so long as the Reference Obligations
of the Hedge Counterparty (or any Person that shall have absolutely and
unconditionally guaranteed the obligations of the Hedge Counterparty under a
Hedging Agreement) shall fail to be rated at least "A2" by Moody's and at least
"A" by Standard & Poor's, the obligation to deliver collateral under an ISDA
Credit Support Annex having, among others, the following terms: (a) no
collateral delivery obligations
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for the Issuer; (b) no collateral delivery obligations for the Hedge
Counterparty except when such delivery obligation is effective by reason of the
agreement of the Hedge Counterparty; and (c) a provision to the effect that, in
calculating the amount of collateral required to be delivered to the Issuer,
the ▇▇▇▇ to market value of any amount owing to the Issuer upon termination of
the Hedging Agreement shall be deemed to be equal to [100%] of such ▇▇▇▇ to
market value calculated in accordance with normal procedures under the ISDA
Credit Support Annex.
"Hedging Agreement": Any interest rate protection agreement
or agreements evidenced by an ISDA Master Agreement and the schedule thereto
and the confirmation thereunder, between the Issuer and a Hedge Counterparty,
and any replacement Hedging Agreement entered into by the Issuer pursuant to
Article 9 of the Common Agreement.
"Hedging Proceeds": With respect to any Quarterly Payment
Date, all net termination payments received by the Issuer under any Hedging
Agreement during the related Due Period.
"High Interest Rate Scenario": The meaning specified under
"Liquidity Test" in this Appendix A.
"Holder" or "Noteholder": With respect to any Note, the
Person in whose name such Note is registered in the Note Register.
"Incentive Fee": The meaning specified in Section 7.01 of the
Management Agreement.
"Indenture": The Indenture dated as of ___________, 1998
between the Issuers and Chase Texas as Trustee, as originally executed and, if
from time to time supplemented or amended by one or more indentures
supplemental thereto entered into pursuant to the applicable provisions
thereof, as so supplemented or amended.
"Independent": As to any Person, any other Person (including,
in the case of an accountant, or lawyer, a firm of accountants or lawyers and
any member thereof) who (i) does not have and is not committed to acquire any
material direct or any material indirect financial interest in such Person or
in any Affiliate of such Person, and (ii) is not connected with such Person as
an Officer, employee, promoter, underwriter, voting trustee, partner, director
or Person performing similar functions. "Independent" when used with respect
to any accountant may include an accountant who audits the books of such Person
if in addition to satisfying the criteria set forth above the accountant is
independent with respect to such Person within the meaning of Rule 101 of the
Code of Ethics of the American Institute of Certified Public Accountants.
Whenever any Independent Person's opinion or certificate is to
be furnished to the Trustee, such opinion or certificate shall state that the
signer has read this definition and, that the signer is Independent within the
meaning hereof.
"Independent Engineer": Any Independent and internationally
recognized firm of engineers with expertise in the relevant Permitted Industry.
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"Indorsement": The meaning specified in Section 8-102(a)(11)
of the UCC. "Indorsed" shall have a correlative meaning.
"Industry Concentration Factor": On any date of
determination, with respect to a Standard & Poor's Industry to which one or
more of the investments credited to the Uncommitted TIP Account described in
clause (a) of Uncommitted TIP Investment Policies pertain, the aggregate
principal amount of such investments divided by the aggregate principal amount
of all Uncommitted TIP Investments credited to the Uncommitted TIP Account
described in clause (a) of Uncommitted TIP Investment Policies and (ii) with
respect to a Standard & Poor's Industry to which one or more of the investments
credited to the Committed TIP Account described in clause (c) of Committed TIP
Investment Polices pertain, the aggregate principal amount of such investments
divided by the aggregate principal amount of all Committed TIP Investments
credited to the Committed TIP Account described in clause (c) of Committed TIP
Investment Policies.
"Initial Class B Notes":
"Initial Class I Interests": The meaning specified in Section
__ of the Partnership Agreement.
"Initial Equity": Any contribution by Project Sponsors to the
initial total capital cost of a Project Borrower in the form of (i) equity or
any financial instrument (including subordinated loans), the expected timing
and amounts of payments under which and the associated rights and remedies of
which are substantially similar to those of an equity interest and/or (ii) an
irrevocable and unconditional commitment to purchase or acquire any of the
foregoing by an Acceptable Credit Provider.
"Initial Interest": Any Interest funded on or prior to the
Closing Date.
"Initial Issuance Expenses": All Transactions Expenses of the
Issuers with respect to the Notes issued on the Closing Date, all expenses
related to the establishment of any Backup Facility existing as of the Closing
Date, all expenses related to the establishment of the Liquidity Facility, the
initial Administrative Fee and the time and expenses of Enron employees
directly involved in the formation of the Issuers.
"Initial Note": Any Note issued by the Issuers on the Closing
Date.
"Instruction": The meaning specified in Section 8-102(a)(12)
of the UCC.
"Instrument": The meaning specified in Section 9-105(1)(i) of
the UCC.
"Integrated Contractual Arrangements": The contractual
arrangements (such as construction, energy sales or other offtake, fuel supply,
tolling, transportation, operation and maintenance and technical advisory
services agreements, including related hedging arrangements) that provide the
basis for projected cash flows and seek to reduce Project Risk or a franchise,
concession or other agreement that provides for a rate-setting mechanism
(contractual, tariff, regulatory or otherwise) for establishing projected cash
flows and, together with other contractual arrangements as may be applicable,
seeks to reduce Project Risk.
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"Intercreditor Agreement": The Collateral Agency and
Intercreditor Agreement dated as of ____________, 1998, among the Issuer, the
Representatives and the Collateral Agent.
"Interest Accrual Period": The period from, and including, a
Quarterly Payment Date to, but excluding, the next Quarterly Payment Date,
except that the initial Interest Accrual Period (i) for any Note issued on the
Closing Date will commence on, and include, the Closing Date and (ii) for any
Note issued after the Closing Date will commence on, and include, the date of
issuance thereof.
"Interest Coverage Adjustment": Adjustment to the Required
Senior Project Credit Support Percentage effected as follows:
if the Actual Net Interest Margin is less than or greater than
the ▇▇▇▇▇'▇ Assumed Net Interest Margin, the Required Senior Project Credit
Support Percentage shall be calculated as follows:
the greater of (i)
(a) Base Percentage
multiplied by
(b) 1+ (▇▇▇▇▇'▇ Net Interest Margin Adjustment Factor x
(▇▇▇▇▇'▇ Assumed Net Interest Margin - Actual Net
Interest Margin))
and (ii) the Base Percentage assuming the Weighted Average ▇▇▇▇▇'▇
Rating of the Project Loans is one level higher than the actual Weighted
Average ▇▇▇▇▇'▇ Rating of Project Loans.
"Interests": The Class I Interests, the Class II Interests
and the GP Interests of the Issuer issued pursuant to the Partnership
Agreement.
"Intermediate Funding Entity": A Person (i) wholly-owned,
directly or indirectly, by the Issuer and established for the limited purpose
of making Project Loans (including Project Loans denominated in a currency
other than Dollars as contemplated in clause (1) of the definition of "Project
Loan Criteria" in this Appendix A) or (ii) wholly-owned by, or wholly-owning, a
particular Project Borrower and established in a jurisdiction other than the
jurisdiction of such Project Borrower for the sole purpose of obtaining a loan
or loans from the Issuer or another Intermediate Funding Entity and making a
Project Loan which satisfies the Qualifying Criteria to such Project Borrower
by using proceeds thereof.
"Intermediate Funding Loan": A loan made by (i) the Issuer to
an Intermediate Funding Entity or (ii) one Intermediate Funding Entity to
another Intermediate Funding Entity.
"Intermediate Funding Loan Criteria": The conditions relating
to Intermediate Funding Entities set forth in Section 2.1(ii) of the Common
Agreement.
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"Investment Company Act": The United States Investment
Company Act of 1940, as amended, and the rules thereunder.
"Investment Grade": Rating of "BBB-" or higher, in the case
of S&P, and "Baa3" or higher, in the case of ▇▇▇▇▇'▇.
"Investment Period": The period commencing on the Closing
Date and ending on the Scheduled Investment Termination Date or earlier, upon
the occurrence of any of the following events: (i) at the election of the
Program Manager (acting at the direction of the General Partner) if the
aggregate principal amount of Class A Notes and Class B Notes issued as of such
date is at least equal to $____; (ii) at the election of the Program Manager
(acting at the direction of the General Partner), with consent of the holders
of a majority in outstanding principal amount of the Class I Interests, upon
notification to the Collateral Agent and the Trustee that, in light of the
composition of the Issuer's portfolio of Project Loans, general market
conditions and other factors, the making of additional Project Loans would
either be impracticable or not beneficial to the Issuer; (iii) the occurrence
of an Acceleration; (iv) a failure to satisfy the Liquidity Test on any two
consecutive Quarterly Payment Dates; (v) the Tax Redemption Trigger Date; or
(vi) the removal of the Program Manager by the Issuer upon being so directed by
the Limited Partners pursuant to Section 10.02(b) of the Management Agreement.
"Investment Termination Date": The date of termination of the
Investment Period.
"Issuer": Enron International CPO, L.P.
"Issuer Determined Loss": With respect to any Defaulted
Project Loan, the amount of non-recoverable accrued and unpaid interest and
non-recoverable unpaid outstanding principal on such Defaulted Project Loan, as
determined by the Program Manager on behalf of the Issuer.
"Issuer Order" and "Issuer Request": A written order or
request dated and signed in the name of the Issuer by an Authorized Officer of
the Issuer and (if appropriate) the Co-Issuer or by an Authorized Officer of
the Program Manager where permitted pursuant to the Indenture, the Management
Agreement or any other Financing Document, as the context may require or
permit.
"Issuers": The Issuer and the Co-Issuer; provided that
reference to the Issuer alone shall be construed as a reference only to the
Issuer.
"Lenders": The Class A Note Holders, the Class B Note
Holders, the Class C Note Holders, the Liquidity Lenders and the Backup
Lenders.
"LIBOR": Generally, the London interbank offered rate.
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"Lien": Any mortgage, charge, pledge, lien (statutory or
other), privilege, security interest, hypothecation, collateral assignment or
preference, priority or other security agreement, preferential arrangement or
other encumbrance upon or with respect to any property of any kind, real or
personal, movable or immovable, now owned or hereafter acquired (including,
without limitation, any conditional sale or other title retention agreement,
any financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC or comparable
law of any jurisdiction).
"Liquidity Expenses": The meaning specified under "Liquidity
Test" in this Appendix A.
"Liquidity Facility": Collectively, a five-year revolving
credit facility (extendable up to an additional five-years) converting into a
2-year term loan facility to be provided to the Issuer by the Liquidity Lenders
pursuant to the Liquidity Facility Loan Agreement and any Liquidity Test
Commitments.
"Liquidity Facility Agent": The Person named as the agent
under the Liquidity Facility.
"Liquidity Facility Availability Period": The period during
which Liquidity Lenders are required to make advances to the Issuer pursuant to
the terms of the Liquidity Facility Loan Agreement.
"Liquidity Facility Balance": The aggregate principal amount
of (i) drawn amounts under the Liquidity Facility Loan Agreement and (ii) any
drawn amounts under the Liquidity Test Commitments.
"Liquidity Facility Commitment": Funded and unfunded
commitments under (i) the Liquidity Facility Loan Agreement and (ii) any
Liquidity Test Commitments.
"Liquidity Facility Loan Agreement": The Liquidity Facility
Loan Agreement among the Issuer, the Liquidity Facility Agent and the Liquidity
Lenders dated as of ___________, 1998.
"Liquidity Lenders": The parties to the Liquidity Facility
Loan Agreement identified therein as "Lenders" and to the extent there are any
outstanding Liquidity Facility Commitments, Enron or an Enron Affiliate
providing such commitment; provided that in determining whether the Liquidity
Lenders with the requisite Liquidity Facility Balance have given any request,
demand, authorization, direction, notice, consent or waiver under any Financing
Document, any portion of the Liquidity Facility Balance attributable to funds
provided by Enron or any Enron Affiliate shall be disregarded and deemed not to
be outstanding.
"Liquidity Note": The meaning specified in Section 1.2 the
Enron Support Agreement.
"Liquidity Shortfall": The meaning specified in Section
4.2(a)(ii) of the Security Agreement.
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"Liquidity Shortfall Amounts": The meaning specified in
Section 4.2(a) of the Security Agreement.
"Liquidity Test": A test satisfied on any date of
determination if Portfolio Liquidity, as determined by the Program Manager, on
each subsequent Quarterly Payment Date during the Measurement Period, is at
least equal to the Liquidity Expenses, as determined by the Program Manager, on
such dates under both a High Interest Rate Scenario and a Low Interest Rate
Scenario.
The "Portfolio Liquidity" as of any Quarterly Payment
Date during the Measurement Period means the sum of the (i)
projected interest and fees receivable, directly or
indirectly, on (x) Project Loans (including any Project Loan
proposed to be made) in the case of Project Loans made
directly to the Project Borrower, and (y) the Intermediate
Funding Loans made by the Issuer (including any Intermediate
Funding Loans proposed to be made) in the case of Project
Loans made indirectly through an Intermediate Funding Entity
for the relevant Due Period other than loan origination fees
or upfront fees (excluding expense reimbursements) credited to
the Uncommitted TIP Account, (ii) projected interest
receivable on Temporary Investments and Eligible Investments
for the relevant Due Period (iii) the projected aggregate
unfunded commitments under the Liquidity Facility Loan
Agreement as of such date, (iv) projected amounts to be
received under the Hedging Agreements for the relevant Due
Period, (v) the projected amount of Quarterly Project
Distributions during the relevant Due Period and (vi) the
projected aggregate unfunded amounts under the Liquidity Test
Commitments as of such date.
The "Liquidity Expenses" as of any Quarterly Payment
Date during the Measurement Period means the sum of (i)
projected operating expenses described under clauses (i) and
(ii) under the Priority of Payments for the relevant Due
Period, (ii) projected interest on amounts drawn and projected
to be drawn under the Liquidity Facility and the Backup
Facility and any projected commitment or agency fees or other
amounts due thereunder for the relevant Due Period, (iii)
projected interest on the Class A Notes for the relevant
Interest Accrual Period, (iv) projected amounts to be paid
under the Hedging Agreements for the relevant Due Period, (v)
projected interest to be paid on the Class B Notes for the
relevant Interest Accrual Period, (vi) projected
Administrative Fees, Management Fees and Incentive Fees to be
paid for the relevant Due Period , (vii) projected interest on
the Class C Notes to be paid for the relevant Interest Accrual
Period, (viii) projected expenses relating to the
establishment of any Backup Facility Loan Agreements during
the relevant Due Period, (ix) projected Extraordinary Expenses
to be paid during the relevant Due Period and (x) any Initial
Issuance Expenses or Transaction Expenses in excess of the
amounts credited to the Operating Account for such purpose on
the Closing Date or the Subsequent Closing Date.
"High Interest Rate Scenario": The scenario in which
three-month LIBOR is assumed to be the then current
three-month LIBOR plus 6%.
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"Low Interest Rate Scenario": The scenario in which
three-month LIBOR is assumed to be the greater of 3% and the
then current three-month LIBOR less 6%.
"Liquidity Test Commitment": A commitment made by Enron
pursuant to Section 5.2 of the Enron Support Agreement to satisfy the Liquidity
Test.
"Low Interest Rate Scenario": The meaning specified under
"Liquidity Test" in this Appendix A.
"Majority": With respect to any Class or Classes of Notes,
the Holders of more than 50% of the Outstanding Amount of the Notes of such
Class or Classes of Notes, other than Notes held by Enron or an Enron
Affiliate, except that in the event 100% of the Class C Notes are held by Enron
or Enron Affiliates, "Majority" of the Class C Notes shall mean Enron or such
Enron Affiliate.
"Majority Affiliate": With respect to a specified Person, any
Person directly or indirectly owning, controlling or holding the power to vote
50% or more of the outstanding voting securities or other voting ownership
interests of the specified Person.
"Management Agreement": The Management Agreement, dated as of
_________, 1998 among the Issuers and the Program Manager.
"Management Fee": The meaning specified in Section 7.01 of
the Management Agreement.
"Margin Security": "Margin stock" within the meaning given to
such term in Regulation U.
"Material Adverse Effect": With respect to the Issuer or the
Co-Issuer, a material adverse effect on the Collateral (taken as a whole),
business, operations, financial condition or capitalization of the Issuer or
the Co- Issuer, as the case may be, or the ability of the Issuer or the
Co-Issuer to perform its obligations under any of the Financing Documents or
the validity or enforceability thereof or the rights and remedies of any other
Person party thereto.
"Material Modification": The meaning specified in Section
4.11(a)(xiii)(D) of the Common Agreement.
"Maturity": With respect to any Note, the date on which all
outstanding unpaid principal of such Note becomes due and payable as therein or
in the Indenture provided, whether at the Stated Maturity or by acceleration,
call for redemption or otherwise.
"Maximum Class A Principal Amount": $[___] billion.
"Maximum Senior Indebtedness": An amount provided by S&P to
the Issuer upon request by the Issuer that S&P will determine by running a cash
flow model utilizing the following inputs:
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(i) The Standard & Poor's Ratings of the Project Loans,
except that if the sum of the Project Loan Balances to Eligible
Projects located in a single country exceeds $___________, then the
Standard & Poor's Ratings of such Project Loans shall be deemed to be
two notches below the actual Standard & Poor's Ratings of such Project
Loans for purposes of running the cash flow model;
(ii) The principal balance, interest rate and amortization
profile of the Project Loans;
(iii) If the sum of the Project Loans Balances to Eligible
Projects located in a single S&P Region exceeds $___ billion, then the
S&P Regions in which such Eligible Projects are located;
(iv) For each Project Loan, the recovery rate assumed by
S&P in the event of default of such Project Loan (as of the Closing
Date such rate is assumed to be 50%);
(v) The interest rate payable on the Notes and the Backup
Facility after taking into account any Hedging Agreements as well as
any other expenses of the Issuer; and
(vi) In the case of the Class A Senior Notes, the
projected amount of the Quarterly Project Distributions in the event
and to the extent that such amount will be supported by a letter of
credit or similar arrangement satisfactory to S&P from a provider
rated "A" or higher by S&P, and in the case of the Class B Senior
Subordinated Notes, the projected Quarterly Project Distributions.
From the characteristics of the Project Loans in (i), (ii) and (ii) above, S&P
will derive two default rates to be applied to the portfolio of Project Loans.
One default rate will be used to assess the credit quality of the Class A
Senior Notes (the "Class A Default Rate") and the other default rate will be
used to assess the credit quality of the Class B Senior Subordinated Notes (the
"Class B Default Rate"). For each Project Loan assumed by S&P to default, S&P
will assume that the assumed recovery rate percentage for the principal balance
of the Defaulted Project Loan is recovered one year after default. A number of
default timing scenarios will be considered. The Maximum Senior Indebtedness
will correspond to the maximum amount of Class A Senior Notes that may be paid
timely interest and ultimate principal assuming the Class A Default Rate while
at the same time permitting the Class B Notes to be paid ultimate interest and
ultimate principal assuming the Class B Default Rate.
"Measurement Period": As of any date of determination, the
period commencing on such date and ending on the later of the second succeeding
Quarterly Payment Date and the date which corresponds to the last scheduled
drawdown date for any Commitments in respect of a Project Loan, assuming that
with respect to Eligible Projects for which Commitments have been made, if any,
that are in their construction phase, each draw occurs one year later than the
date assumed in the drawdown schedule.
"Money": The meaning specified in Section 1-201(24) of the
UCC.
"▇▇▇▇▇'▇": ▇▇▇▇▇'▇ Investors Service, Inc.
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"▇▇▇▇▇'▇ Assumed Net Interest Margin": The percentage
obtained from Table 3 set forth in Annex A hereto (the "▇▇▇▇▇'▇ Assumed Net
Interest Margin Table").
"▇▇▇▇▇'▇ Assumed Net Interest Margin Table": The meaning
specified under "▇▇▇▇▇'▇ Assumed Net Interest Margin" in this Appendix A.
"▇▇▇▇▇'▇ Credit Support Test": A test satisfied on any date
of determination if, after giving effect to the funding in full of a Project
Loan proposed to be funded, amounts to be withdrawn from or credited to the
Uncommitted TIP Account, Allocations or drawings under the Backup Facility, the
proposed issuance of Class A Notes or Class C Notes or the addition to, or
reduction of, the Class C Note Purchase Commitment and amounts credited to the
Excess Spread Account for the purpose of satisfying this test and the Rating
Condition, the (x) Net Senior Debt is less than or equal to zero or (y) the
Actual Senior Credit Support Percentage on such date is at least equal to the
Required Senior Credit Support Percentage on such date.
"▇▇▇▇▇'▇ Industry": Those industries found in Table 5 hereto.
"▇▇▇▇▇'▇ Net Interest Margin Adjustment Factor": The number
obtained from the table set forth below.
--------------------------------------------------------------------------------
B3 B2 B1 Ba3 Ba2 Ba1 Baa3 Baa2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
"▇▇▇▇▇'▇ Rating": With respect to any Project Loan or
Temporary Investment, the rating by ▇▇▇▇▇'▇ of that Project Loan or Temporary
Investment, which rating may be a private letter rating; provided, that if the
Project Loan is being paid in a currency other than U.S. dollars, the rating
shall take into consideration the Currency Hedging Arrangements necessary to
cover currency risk, each such rating as subsequently updated by ▇▇▇▇▇'▇ in
accordance with the Financing Documents.
"▇▇▇▇▇'▇ Region": Each of (a) Africa (other than countries
rated Investment Grade by ▇▇▇▇▇'▇), (b) Asia Pacific (other than countries
rated Investment Grade by ▇▇▇▇▇'▇), (c) Central Asia (other than countries
rated Investment Grade by ▇▇▇▇▇'▇), (d) the Caribbean (other than countries
rated Investment Grade by ▇▇▇▇▇'▇), (e) Europe (other than countries rated
Investment Grade by ▇▇▇▇▇'▇), (f) Latin America (other than countries rated
Investment Grade by ▇▇▇▇▇'▇), (g) the Middle East (other than countries rated
Investment Grade by ▇▇▇▇▇'▇) and (h) individually, all countries rated
Investment Grade by ▇▇▇▇▇'▇ in each case, as of the Closing Date. [DEFINITIONS
TO COME FROM ▇▇▇▇▇'▇]
"Net Proceeds": Proceeds from an issuance of Notes and
Interests net of any Transaction Expenses for such issuance.
"Net Senior Debt": (i) The sum of (A) the Liquidity Facility
Commitment, (B) the Backup Facility Balance and (C) the outstanding principal
amount of the Class A Notes less (ii) (A) the Unused Enron Commitments and (B)
the Excess Spread Account Balance for the purpose of satisfying the Credit
Support Tests and
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the Rating Condition, in each case after giving effect to any proposed issuance
of Class A Notes or Class C Notes.
"New Issuance": The meaning specified in Section 2.9(a) of
the Indenture.
"North America": The geographic areas that are within the
boundaries (as of the date hereof) of Canada, Mexico and the United States.
"Note Interest Rate": With respect to the Notes of any Class
or any Series, the annual rate at which interest accrues on the Notes of such
Class or such Series, as specified in the Indenture or in the related
Supplemental Indenture (as applicable).
"Note Payment Account": The account designated as the "Note
Payment Account" and established pursuant to Section 10.1 of the Indenture
which account shall initially be account number [_____] and shall include any
successor or replacement accounts thereof.
"Note Payment Assumptions": The assumptions used to calculate
interest and principal scheduled to be paid to Noteholders for the purpose of
calculating the Premiums shall consist of the following:
(1) No further redemptions of Class A Notes and Class B
Notes are assumed to occur;
(2) Project Loans are assumed to make Scheduled Payments
on each subsequent Due Date therefor until the
maturity dates of such Project Loans;
(3) Amounts credited to the Uncommitted TIP Account are
immediately invested in a Project Loan the payments
of principal and interest of which are made on a
quarterly basis, has a maturity date equal to the
Stated Maturity of the Notes, bears an interest rate
equal to 9% and beginning on the Scheduled Investment
Termination Date, amortizing on a mortgage-style
basis and no further initial fundings of Project
Loans are made by the Issuer;
(4) Amounts credited to the Committed TIP Account
followed by draws under the Backup Facility in
respect of amounts previously Allocated thereunder
are assumed to be reinvested in previously Committed
but unfunded Project Loans pursuant to the assumed
drawdown schedules;
(5) Amounts credited to the Committed TIP Account are
assumed to earn interest at the contracted rates
thereof until maturity and are assumed to be
reinvested at LIBOR pending reinvestment into Project
Loans;
(6) Amounts invested in other Project Loans or Permitted
Investments not otherwise specified are assumed to
earn interest at the Assumed Reinvestment Rate;
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(7) Hedging Agreements would be terminated and or entered
into in the amounts consistent with managing interest
rate risk given these Note Payment Assumptions;
(8) Quarterly Payment Dates are assumed to fall on the
10th day of the applicable month regardless of when
such Quarterly Payment Date would actually occur;
(9) Distributions on the Notes are made in accordance
with the Priority of Payments;
(10) LIBOR is assumed to be the current LIBOR rate and
does not change; and
(11) LIBOR is the basis for payments under the Backup
Facility and Hedging Agreements.
"Note Redemption Amount": In the case of (i) a Refinancing or
Equity Disposition resulting in a mandatory redemption of Notes, the lesser of
the Disposition Amount and the Target Note Redemption Amount and, (ii) a Tax
Event, the proceeds received by the Issuer from the sale of Project Loans sold
in accordance with Section 2.5 of the Security Agreement.
"Note Register": The meaning specified in Section 2.4(a) of
the Indenture.
"Note Registrar": The Person appointed as registrar under
Section 2.4(a) of the Indenture, in the case of the Class A Notes and Class B
Notes, and the Issuer, in the case of the Class C Notes.
"Noteholder": See "Holder", above.
"Notes": The Class A Notes and the Class B Notes of any
Series and the Class C Notes authorized by, and authenticated and delivered
under, the Indenture and any related Supplemental Indenture .
"OECD": Organization for Economic Cooperation and
Development.
"Offering": The offering of the Class A Notes and Class B
Notes under the Prospectus.
"Officer": With respect to any corporation, the Chairman of
the Board of Directors (or any director, with respect to the Issuer), the
President, any Vice President, the Secretary, an Assistant Secretary, the
Treasurer, the Chief Financial Officer or an Assistant Treasurer of such
entity; with respect to any partnership, any general partner thereof; and with
respect to any bank or trust company acting as trustee of an express trust or
as custodian, any Trust Officer.
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"Offshore Paying Agent": Any Person operating through an
office outside the United States that is authorized by the Issuer to make
payments on behalf of the Issuer as specified in Section 7.2 of the Indenture.
"Operating Account": The account designated the "Operating
Account" and established pursuant to Section 3.7 of the Security Agreement
which account shall initially be account number _______ and shall include any
successor or replacement accounts thereof.
"Operating Expenses": (i) Any expense of the Issuer or the
Co-Issuer described under priorities (i), (ii), (v)(B) and (vi) of the Priority
of Payments and not otherwise paid on a Quarterly Payment Date; (ii) expenses
relating to the establishment of Backup Facility Loan Agreements after the
Closing Date; (iii) any Initial Issuance Expenses or Transaction Expenses in
excess of the amounts credited to the Operating Account for such purpose on the
Closing Date or the Subsequent Closing Date.
"Opinion of Counsel": A written opinion addressed to the
Trustee or the Collateral Agent, as the case may be, and each Rating Agency, in
form and substance reasonably satisfactory to the Collateral Agent and each
Rating Agency, of an attorney at law admitted to practice before the highest
court of any state of the United States or the District of Columbia, which
attorney may, except as otherwise expressly provided in the relevant Financing
Document, be counsel for the Issuer or the Co-Issuer or the Program Manager, as
the case may be, and which attorney shall be reasonably satisfactory to the
Collateral Agent or Trustee, as the case may be. Whenever an Opinion of
Counsel is required under any Financing Document, such Opinion of Counsel may
rely on opinions of other counsel who are so admitted and so satisfactory,
which opinions of other counsel shall accompany such Opinion of Counsel and
shall either be addressed to the Collateral Agent or Trustee, as the case may
be and the Rating Agencies or shall state that the Collateral Agent or Trustee,
as the case may be, and the Rating Agencies shall be entitled to rely thereon.
"Outstanding": With respect to the Notes, as of any date of
determination, all of such Class of Notes or the Notes, as the case may be,
theretofore authenticated and delivered under the Indenture except:
(i) Notes theretofore canceled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof for whose payment or
redemption funds in the necessary amount have been theretofore
irrevocably deposited with the Trustee or any Paying Agent in trust
for the Holders of such Notes; provided that, if such Notes or
portions thereof are to be redeemed, notice of such redemption has
been duly given pursuant to the Indenture or provision therefor
satisfactory to the Trustee has been made;
(iii) Notes in exchange for, or in lieu of, other Notes which
have been authenticated and delivered pursuant to the Indenture,
unless proof satisfactory to the Trustee is presented that any such
Notes are held by a holder in due course; and
(iv) Notes alleged to have been mutilated, destroyed, lost or
stolen for which replacement Notes have been issued as provided in
Section 2.5 of the Indenture;
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provided that in determining whether the Holders of the requisite Outstanding
Amount have given any request, demand, authorization, direction, notice,
consent or waiver under the Indenture or any other Financing Document, Notes
owned by or pledged to the Issuer, the Co-Issuer, Enron, the Program Manager or
any other obligor upon the Notes or any Affiliate of any of them shall be
disregarded and deemed not to be Outstanding (except where only the Holders of
Class C Notes are involved in such act), except that, in determining whether
the Trustee or the Collateral Agent shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Notes that the Trustee or the Collateral Agent knows to be so owned or pledged
shall be so disregarded.
"Outstanding Amount": When used with respect to any of the
Notes at any time, the aggregate principal amount of such Notes Outstanding at
such time. Except as otherwise provided herein, the Outstanding Amount of
Class B Notes and Class C Notes at any time shall include all Class B Deferred
Interest or Class C Deferred Interest, as the case may be, at such time.
"Partnership Agreement: The Amended and Restated Agreement of
Limited Partnership of the Issuer dated [_____], among the General Partner and
[the holders of the Class I Interests and the Class II Interests].
"Paying Agent": Any Person authorized by the Issuer to pay
the principal of or interest on any Notes on behalf of the Issuer as specified
in Section 7.2 of the Indenture.
"Payment": Any payment of principal or interest or any
dividend or premium payment made on, or any other distribution in respect of,
an obligation or Security.
"Permitted Capital Expenditure": A capital expenditure of the
Issuer reasonably necessary (as determined by the Program Manager on behalf of
the Issuer) for the performance of the acts and obligations of the Issuer under
the Financing Documents.
"Permitted Country": The meaning set forth in paragraph (11)
under "Project Loan Criteria" in this Appendix A.
"Permitted Industry": Each of the electricity and energy
infrastructure industries (including, without limitation, electricity
generation, transmission and distribution; gas, oil, liquids and refined
products pipelines; liquefied natural gas; refineries; petrochemicals; gas
liquids; energy-related industries with gas as a major feedstock or component
or industries with gas as a major conversion agent), including, in any case,
directly related and integrated businesses (including mining, oil and gas
development and production, and other businesses reasonably related to the
foregoing, and any facility the investment in which is a condition to the
investment in any of the aforesaid industries), but excluding the nuclear
industry.
"Permitted Investments": The Eligible Investments and
Temporary Investments.
"Permitted Liens": Any Lien on all or a portion of the
Collateral (i) for taxes, assessments or governmental charges either not yet
due or being contested in good faith, where such Lien would not have a Material
Adverse Effect, (ii) arising from any litigation or other legal
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proceeding that is being contested in good faith, where such Lien would not
have a Material Adverse Effect or (iii) Liens granted pursuant to the Security
Documents.
"Person": An individual, corporation (including a business
trust), partnership, limited liability company, joint venture, association,
joint stock company, trust (including any beneficiary thereof), unincorporated
association or government or any agency or political subdivision thereof.
"Plan": An ERISA Plan and any other "plan" (as defined in
Section 4975(e)(1) of the Code) which is subject to the provisions of Section
4975 of the Code.
"Portfolio Assets": All present and future rights of the
Issuer under the Project Loans and the Intermediate Funding Loans, including
the Issuers' interest in any collateral at the project level which secures such
loans, the Permitted Investments, the Hedging Agreements, the Currency Hedging
Arrangements, the Enron Support Documents, the Repayment Agreements, any other
agreement entered into by the Issuer and amounts credited to the Accounts.
"Portfolio Criteria": The following conditions to the
acquisition or initial funding of a Project Loan:
(1) (A) the maximum Project Loan Balance of any single Project
Loan will not exceed $___________, except that the Issuer may
make up to two Project Loans in separate Regions, each of
which has a maximum Project Loan Balance of up to
$___________, (B) the aggregate Project Loan Balance of
outstanding Project Loans to Eligible Merchant Projects shall
not exceed $_____________, (C) the aggregate Project Loan
Balance of outstanding Project Loans to Eligible Merchant
Projects having a Standard & Poor's Rating below "BB-" or a
▇▇▇▇▇'▇ Rating below "Ba3" shall not exceed $___________, (D)
the aggregate Project Loan Balance of outstanding Project
Loans to Eligible Projects principally involving solar, wind
and geothermal energy shall not exceed $___________, and (E)
the aggregate Project Loan Balance of Project Loans to
Eligible Projects principally involving solar and wind energy
shall not exceed $___________;
(2) after giving effect to the initial funding of the
Project Loan,
(a) no more than $_____________ of the Aggregate
Project Loan Balance will be in connection
with Eligible Projects located in any one
Continent;
(b) other than as may be permitted in paragraph
(c) below, no more than $_____________ of the
Aggregate Project Loan Balance shall be in
connection with Eligible Projects located in
any one Region;
(c) no more than $_____________ of the Aggregate
Project Loan Balance shall be in connection
with Eligible Projects located in any one
country whose long-term sovereign debt
obligations are rated, on the Financial
Closing Date for the Project Loan to be
added, at or above "Aa2" and "AA" by ▇▇▇▇▇'▇
and S&P, respectively; and
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(d) except as set forth in (e), no more than
$___________ of the Aggregate Project Loan
Balance shall be in connection with Eligible
Projects located in any one country whose
long-term sovereign debt obligations are
rated, on the Financial Closing Date for the
Project Loan to be added, below "AA" by S&P;
and
(e) in no more than two countries, each of which
is located in a separate S&P Region, no more
than $___________ of the Aggregate Project
Loan Balance shall be in connection with
Eligible Projects located in any such country
the long-term sovereign debt obligations of
which are rated, on the Financial Closing Date
for the Project Loan to be added, below AA by
S&P;
(3) on the Financial Closing Date (and after giving effect to the
initial funding of such Project Loan), the Average Life Test
shall be satisfied;
(4) after giving effect to the initial funding or acquisition of
the Project Loan, all outstanding Project Loans collectively
will have a Weighted Average ▇▇▇▇▇'▇ Rating of at least "B3";
and
(5) at any time on or after the Financial Closing Date of the
third Project Loan initially funded by the Issuer, the
weighted average Enron Ownership Percentage with respect to
all Project Borrowers financed by Project Loans will be at
least [__]%.
"Portfolio Financial Tests": The Funding Availability Test,
the Credit Support Tests and the Liquidity Test.
"Portfolio Liquidity": The meaning specified under "Liquidity
Test" in this Appendix A.
"Premium": Any of the Class A Make-Whole Premium or Class B
Premium.
"Pricing Terms": The meaning specified in Section 2.02(a) of
the Management Agreement.
"Principal Balance" or "par": With respect to any Project
Loan or Permitted Investment, as of any date of determination, the outstanding
principal amount of such Project Loan or Permitted Investment.
"Principal Terms": With respect to any Series:
(1) the name or designation of such Series;
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(2) the Note Interest Rate (or method of determination
thereof) for the Notes of such Series;
(3) the principal amount of the Notes of such Series; and
(4) the extent to which the Notes of such Series will be
issuable in temporary or permanent global form (and,
in such case, the depositary for such Global Note or
Notes), the terms and conditions, if any, upon which
such Global Note may be exchanged, in whole or in
part, for Certificated Notes, and the manner in which
any interest payable on a temporary or Global Note
will be paid.
"Priority of Payments": The payment priorities with respect
to the Collateral Proceeds provided by Section 4.1(a) of the Security
Agreement.
"Pro Rata": In respect of any Senior Secured Party, in
relation to all other Senior Secured Parties, on any date of determination, the
ratio, the numerator of which shall be (i) in the case of the Class A
Noteholders, the sum of the Outstanding Amount of all Class A Notes and
interest (and premium, if any) payable thereon as of such date, (ii) in the
case of the Liquidity Lenders, the Liquidity Facility Balance plus accrued but
unpaid interest and any other amounts owing under the Liquidity Facility, (iii)
in the case of the Backup Lenders, the Backup Facility Balance plus accrued but
unpaid interest and any other amounts owing under the Backup Facility and (iv)
in the case of the Hedge Counterparties, the sum of all payments due under each
Hedging Agreement, and the denominator of which shall be the sum of amounts
referred to in the immediately preceding clauses (i), (ii), (iii) and (iv).
"Proceeding": Any suit in equity, action at law or other
judicial or administrative proceeding.
"Program Manager": Enron CPO Management, L.P., a limited
partnership duly formed and validly existing under the laws of the State of
Delaware, which is a wholly-owned subsidiary of Enron.
"Project Borrower": A corporation, partnership, limited
liability company or other entity which owns an Eligible Project and borrows
funds in the form of loans from the Issuer directly or through an Intermediate
Funding Entity; provided that, in addition to owning and operating an Eligible
Project, Project Borrowers may make investments and conduct business activities
that are not otherwise in a Permitted Industry, provided, however, (i) the cost
of such investment or activity, if financed by a Project Loan or other senior
debt, is limited to 5% of the total capital cost of such Eligible Project as
set forth in the Base Case Financial Projections for such Eligible Project (it
being understood that such limitation shall not apply to any such investments
and activities that are not financed by a Project Loan or other senior debt),
(ii) such investments and activities are not reasonably expected to result in
any material adverse effect on such Eligible Project (as determined by the
Program Manager), (iii) the Base Case Financial Projections for such Eligible
Project do not rely on the success of such investments or activities and (iv)
the projected operating expenses for such activities are not material in the
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context of the Eligible Project and the payments of such operating expenses are
subordinated to any payments of debt service under the Project Loan.
"Project Distributions Reserved": The meaning specified in
Section 1.2 of the Enron Support Agreement.
"Project Loan": With respect to an Eligible Project, a loan
made by the Issuer or an Intermediate Funding Entity to a Project Borrower.
"Project Loan Balance": With respect to each Project Loan,
the outstanding principal balance of such Project Loan plus unfunded
Commitments to make such Project Loan.
"Project Loan Criteria": The following conditions to be
satisfied for the initial funding of, or in respect of, a Project Loan:
(1) the Project Loan is denominated in U.S. dollars and
is not contractually or by way of security
subordinate to any other indebtedness for borrowed
money of the Project Borrower and contains customary
restrictions with respect to the incurrence of other
indebtedness; provided, however, the Project Loan may
be denominated in a currency other than U.S. dollars
if, and only if, it is made through an Intermediate
Funding Entity and the Intermediate Funding Entity
has (A) entered into an Intermediate Funding Loan
with the Issuer in U.S. dollars and (B) hedged its
foreign currency risk related to such Project Loan
pursuant to a Currency Hedging Arrangement;
(2) the Project Loan is secured by a valid first priority
perfected lien on the tangible and intangible assets
of the Project Borrower (to the extent such
collateral security interest may be created or
perfected under applicable law) or if, in the
reasonable judgment of the Program Manager it is
impractical to create or perfect such lien over any
such asset, the Issuer is the beneficiary of a
negative pledge in respect thereof, in each case with
customary exceptions;
(3) the aggregate amount of Initial Equity in the Project
Borrower representing at least the following
percentage of the total capital cost of the Eligible
Project: (x) 10% if the Project Loan is rated
Investment Grade by S&P and ▇▇▇▇▇'▇ and has been made
in connection with any Eligible Project other than an
Eligible Merchant Project; (y) 20% if the Project
Loan has been made in connection with an Eligible
Merchant Project; and (z) 15% otherwise;
(4) the Enron Ownership Percentage with respect to such
Eligible Project is at least: (x) 30% prior to the
commencement of commercial operations by such
Eligible Project and (y) 20% thereafter;
(5) at or prior to the Financial Closing Date of such
Project Loan, the Issuer will have received:
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(x) satisfactory opinions of legal counsel; and
(y) a report of an Independent Engineer
confirming:
(I) the technical and economic
feasibility of such Eligible Project
and concurring that the assumptions
used in developing the Base Case
Financial Projections for the
Eligible Project are commercially
reasonable;
(II) that the Eligible Project is
expected during its operation period
to generate on an annual basis
sufficient operating revenues to
cover its operating costs (including
fuel, where applicable) and debt
service over the term of the Project
Loan in accordance with the
project's Base Case Financial
Projections (taking into account
reserve funds and other forms of
credit enhancement and the currency
of payment of debt service and
operating costs); and
(III) in the case of an Eligible Merchant
Project, that it is expected during
the operating period to generate on
an annual basis sufficient operating
revenues to cover its operating
costs (including fuel, where
applicable) and debt service over
the term of the Project Loan in
accordance with the project's Base
Case Financial Projections (under a
reasonable range of economic and
operating scenarios and taking into
account reserve funds and other
forms of credit enhancement and the
currency of payment of debt service
and operating costs).
In rendering such report such Independent
Engineer shall rely, as to matters outside
the scope of its expertise, on the reports of
other Independent consultants obtained by the
Program Manager;
(6) the Project Borrower has a limited business
purpose and would be protected (subject to
customary qualifications) from any claims of
the creditors of any of its Project Sponsors
arising out of the bankruptcy of such Project
Sponsor;
(7) at or within a reasonable period of time
prior to the Financial Closing Date of such
Project Loan, the Issuer shall have received
Base Case Financial Projections, reflecting
commercially reasonable assumptions, prepared
by the Project Borrower indicating (x) that
sufficient funds are committed through the
Project Loan, other debt financing and equity
financing to permit the completion of the
Eligible Project under the terms of the
construction arrangements and (y) a minimum
annual pre-tax senior debt service coverage
ratio and an average annual pre-tax senior
debt service coverage ratio of at least 1.2
and 1.4, respectively (in each case after
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taking into account the availability of
contingent support committed to be provided
by Project Sponsors) (the requirement set
forth in this paragraph (7) is hereinafter
referred to as the "Coverage Ratio
Condition");
(8) the loan agreement shall include a provision
for the establishment, on or prior to the
commencement of commercial operations of the
Eligible Project, of a debt service reserve in
an amount at least equal, as of such
commencement, to the principal and interest
due during the ensuing six month period. Such
reserves shall be funded from (i) financing
proceeds, (ii) initial operating cash flow
available to the Project Borrower or (iii)
Project Sponsor deposits or commitments, and
maintained in U.S. dollars held in an offshore
account. Subsequent to the establishment of
the debt service reserve, it will be
replenished from, and to the extent of,
available cash flow up to an amount at least
equal, as of any payment date, to the
principal and interest due during the
six-month period following such payment date.
Notwithstanding the above, any debt service
reserve amounts may be released to the extent
the Project Sponsors provide guaranties for
repayment from Enron, an Enron Credit
Counterparty or an Acceptable Credit Provider
to such Project Borrower;
(9) the Project Borrower will be prohibited from
paying dividends (or making distributions) or
making payment on any Initial Equity or any
subsequent equity in the Project Borrower in
any year in which the debt service coverage
ratio is below ____ or there is an event of
default under the Project Loan (provided that
if no event of default under the Project Loan
has occurred, accumulated earnings and
profits may be distributed as dividends and
interest and principal may be paid on any
Initial Equity if the Project Sponsors
provide a guaranty from Enron, an Enron
Credit Counterparty or an Acceptable Credit
Provider to the Project Borrower for the
amount of such payments);
(10) the Project Loan must have a final scheduled
maturity date of, and be expected to be
repaid from the operations of the Eligible
Project, no later than the Stated Maturity of
the Notes;
(11) the Project Loan will finance an Eligible
Project in a country outside of the United
States in which it is not illegal under the
federal laws of the United States for United
States private sector entities to invest as
of the Financial Closing Date of such Project
Loan (a "Permitted Country"); and
(12) the Project Loan shall accrue interest at a
(i) fixed rate throughout the term of the
Project Loan or (ii) floating rate prior to
commencement of commercial operations of the
related Eligible Project and at a fixed rate
thereafter; provided, however, interest on a
Project Loan may accrue at a floating rate
after the commencement of commercial
operations of the related Eligible Project,
if, and only if, an arrangement has been made
pursuant to which any interest rate exposure
relating to such Project Loan is hedged and
any residual exposure relating to any
breakage and termination costs of such
arrangement is indemnified by an Acceptable
Credit Provider;
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provided that, a Project Loan made to Transportadora de Gas del Sur
S.A., Promigas S.A., Gas Transboliviano, Compania Estadual de Gas do
Rio de Janeiro - CEG or Riogas, S.A., or a Majority Affiliate of any
of them, shall be deemed to satisfy clauses (2) and (7) above; and
provided, further, that if a Project Loan fails to satisfy the Project
Loan Criteria for failure to meet the conditions specified in clauses
(2) or (5)(x) above, the Issuer, upon receipt of an unconditional,
irrevocable guarantee (which shall guarantee the payment obligations
of the Project Borrower under the Project Loan until the date on which
such condition or conditions are satisfied) from Enron, an Enron
Credit Counterparty or an Acceptable Credit Provider, shall deem such
conditions to be satisfied for purposes of the Project Loan Criteria.
"Project Loan Table": The meaning specified under "Required
Senior Project Credit Support Percentage" in this Appendix A.
"Project Risk": Construction, commodity price, offtake and
currency risk.
"Project Sponsor": With respect to a Project Borrower, any
Person who owns (i) shares, if such Project Borrower is a corporation, (ii)
membership interests, if such Project Borrower is a limited liability company
and (iii) partnership interests, if such Project Borrower is a partnership.
"Prospectus": The Prospectus dated _____________, 1998
relating to the Class A Notes and the Class B Notes to be issued on the Closing
Date.
"Qualifying Criteria": (1) The Project Loan Criteria, (2) the
Portfolio Criteria, (3) the Ratings Criteria and (4) the Portfolio Financial
Tests.
"Quarterly Payment Dates": January 10, April 10, July 10 and
October 10 of each year, commencing on January 10, 1999 or, if any such date is
not a Business Day, the immediately following Business Day.
"Quarterly Payment Shortfall": The meaning specified in
Section 4.1(b) of the Security Agreement.
"Quarterly Project Distributions": The meaning specified in
Section 1.2 of the Enron Support Agreement.
"Rating Agency": Each of Moody's, for so long as any of the
outstanding Notes are rated by Moody's, and Standard & Poor's, for so long as
any of the outstanding Notes are rated by Standard & Poor's or, with respect to
Pledged Securities generally, if at any time Moody's or Standard & Poor's
ceases to provide rating services with respect to high yield debt securities,
any other nationally recognized investment rating agency selected by the
Issuer. In the event that at any time Moody's ceases to be a Rating Agency,
references to rating categories of Moody's in the Indenture or in any other
Financing Document shall be deemed instead to be references to the equivalent
categories of such other rating agency as of the most recent date on which such
other rating agency and Moody's published ratings for the type of security in
respect of which such alternative rating agency is used. In the event that at
any time Standard & Poor's ceases to be a Rating Agency, references to rating
categories of Standard & Poor's in the
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Indenture or in any other Financing Document shall be deemed instead to be
references to the equivalent categories of such other rating agency as of the
most recent date on which such other rating agency and Standard & Poor's
published ratings for the type of security in respect of which such alternative
rating agency is used.
"Rating Condition": With respect to the initial funding of
any Project Loan or when required in connection with the issuance or redemption
of any Notes or the reduction of the Class C Note Purchase Commitment, or any
other circumstance where the context may otherwise require, the condition that
the Rating Agencies have determined that such initial funding, issuance,
redemption, reduction or circumstance, as the case may be, will not result in
the reduction or withdrawal of the then-current ratings of the Class A Notes or
Class B Notes.
"Ratings Criteria": The criteria to be satisfied as a
condition to the initial funding of a Project Loan that the Issuer shall have a
current rating of such Project Loan from the Rating Agencies and the Rating
Agencies shall have confirmed that the Rating Condition will be or is satisfied
after giving effect to the initial funding of such Project Loan.
"Record Date": The date on which the Holders of Notes are
determined for purposes of (i) receipt of payment in respect of principal or
interest on the succeeding Quarterly Payment Date, (ii) an Acceleration or
(iii) a redemption of Notes pursuant to Article 10 of the Common Agreement,
which date is the 15th day (whether or not a Business Day) prior to the
applicable date.
"Redemption Date": Any date specified for a redemption of
Notes and the repayment of amounts drawn under the Liquidity Facility and
Backup Facility pursuant to Sections 10.2 or 10.3 of the Common Agreement or,
if such date is not a Business Day, the next following Business Day.
"Redemption Date Statement": The meaning specified in Section
10.4(c) of the Indenture.
"Redemption Price": When used with respect to:
(i) a Class A Note of any Series, an amount equal to the
principal amount of such Class A Note to be redeemed plus all unpaid
interest thereon accrued to but excluding the Redemption Date plus the
Class A Make-Whole Premium;
(ii) a Class B Note of any Series, an amount equal to the
principal amount of such Class B Note to be redeemed plus all unpaid
interest thereon accrued to but excluding the Redemption Date plus the
Class B Premium;
(iii) any Class C Note, an amount equal to the principal
amount of such Class C Note to be redeemed plus all unpaid interest
thereon to but excluding the Redemption Date; and
(iv) any Support Note, an amount equal to the principal
amount of such Support Note to be redeemed plus all unpaid interest
thereon to but excluding the Redemption Date.
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"Reference Obligation": With respect to any Hedge
Counterparty or any other Person, the unsecured, unguaranteed and unsupported
senior long-term debt or deposit obligations of such Hedge Counterparty or such
other Person.
"Refinancing": The refinancing or prepayment of a Project
Loan in its entirety.
"Region": The Moody's Region or the S&P Region, as
applicable.
"Registered": With respect to any debt obligation, a debt
obligation (a) in the case of a U.S. issuer, issued after July 18, 1984 and (b)
in registered form for purposes of the Code.
"Registered Form": When used with respect to a Certificated
Security, means a form in which: (a) the Security Certificate specifies a
Person entitled to the Security; and (b) a transfer of the Security may be
registered upon books maintained for that purpose by or on behalf of the issuer
of such Security, or the Security Certificate so states.
"Regulation U": Regulation U of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Section 21, or any successor regulation.
"Reinvestment Agreement": A guaranteed reinvestment agreement
from a bank, insurance company or other corporation or entity incorporated
under the laws of the United States of America or any state thereof under which
no payments are subject to any withholding tax; provided, that such agreement
provides that it is terminable by the purchaser, without premium or penalty, in
the event that the rating assigned to such agreement by either Rating Agency is
at any time lower than the rating required pursuant to the terms of the
relevant Financing Document to be assigned to such agreement in order to permit
the purchase thereof.
"Relevant Jurisdiction": As to any obligor on any Project
Loan, any jurisdiction (a) in which the obligor is incorporated, organized,
managed and controlled or considered to have its seat, (b) where an office
through which the obligor is acting for purposes of the relevant Project Loan
is located, (c) in which the obligor executes Underlying Instruments or (d) in
relation to any payment, from or through which such payment is made.
"Repayment Agreement": The meaning specified in Section 3.5
of the Security Agreement.
"Representatives": Each of the Backup Facility Agents, the
Liquidity Facility Agent and the Trustee.
"Required Lenders": As of a date of determination (A) if any
Senior Secured Obligation is outstanding at such time, Senior Lenders (each
acting through its respective Representative) representing at least 50% of the
Aggregate Senior Loan Balance; (B) if Class B Notes, but no Senior Secured
Obligations, are outstanding at such time, the Class B Notes representing at
least 50% of the Outstanding Amount of Class B Notes; and (C) if Class C Notes,
but no Senior Secured Obligations or Class B Notes, are outstanding at such
time, the Class C Notes representing at least 50% of the Outstanding Amount of
Class B Notes; provided, however, in the case of
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(i) an exercise of remedies in accordance with Section
3.3(a) of the Intercreditor Agreement following an Event of Default
specified in Section 5.1 of the Common Agreement (other than Events of
Default specified in Sections 5.1(a) and 5.1(b)) and Section 5.1(a) of
the Security Agreement, "Required Lenders" shall be determined in
accordance with the foregoing clauses (A), (B) and (C) but
substituting "33%" in each place "50%" is used,
(ii) an exercise of remedies in accordance with Section
3.3(a) of the Intercreditor Agreement following an Event of Default
specified in Sections 5.1(a) and 5.1(b) of the Common Agreement,
"Required Lenders" shall be determined in accordance with the
foregoing clauses (A), (B) and (C) but substituting "25%" in each
place "50%" is used,
(iii) Section 2.1(b)(ii) of the Common Agreement, and
Article VIII of the Enron Support Agreement, "Required Lenders" shall
mean Holders representing at least 50% of the Outstanding Amount of
each of the Class A Notes, the Class B Notes, the aggregate
outstanding principal amount under the Liquidity Facility and the
aggregate principal amount of [Allocations and] drawn amounts under
the Backup Facility, voting as a single class,
(iv) consent of the Required Lenders given pursuant to
Section 3.3(e) of the Intercreditor Agreement for actions to be taken
pursuant to Section 2.5(a)(iv) of the Security Agreement, "Required
Lenders" shall also include, to the extent the Senior Secured
Obligations and Class B Notes are outstanding at such time, the
Holders of the Class B Notes representing at least 50% of the
Outstanding Amount of the Class B Notes, and
(v) consent of the Required Lenders given pursuant to
Section 3.3(e) of the Intercreditor Agreement for actions to be taken
pursuant to Section 4.5 of the Common Agreement and Sections 10.02(b)
and 10.03(a)(iv) of the Management Agreement, "Required Lenders" shall
be determined in accordance with the foregoing clauses (A), (B) and (C)
but substituting "66 2/3%" in each place 50% is used and shall also
include, to the extent the Senior Secured Obligations and Class B Notes
are outstanding at such time, Holders of the Class B Notes representing
at least 66 2/3% of the Outstanding Amount of the Class B Notes.
"Required Reserve Amount": As of any Quarterly Payment Date,
the greater of (i) the Assumed Loss Amount in respect of all Defaulted Project
Loans minus the Issuer Determined Loss in respect of all such Defaulted Project
Loans and (ii) zero.
"Required Senior Credit Support Percentage": On any date, the
weighted average, calculated based upon the Uncommitted TIP Account Balance and
the Aggregate Project Loan Balance, of the Required Senior TIP Credit Support
Percentage and the Required Senior Project Credit Support Percentage.
"Required Senior Project Credit Support Percentage": The
percentage obtained from Table 2 set forth in Annex A hereto (the "Project Loan
Table" and such percentage, the
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"Base Percentage") and adjusted according to the Interest Coverage Adjustment
set forth in this Appendix A.
"Required Senior TIP Credit Support Percentage": The
percentage obtained in Table 1 (the "TIP Table") set forth in Annex B hereto.
"Reserve Account": The account designated as the "Reserve
Account" and established pursuant to Section 3.4 of the Security Agreement
which account shall initially be account number [______] and shall include any
successor or replacement accounts thereof.
"Reserve Amount": With respect to any Quarterly Payment Date,
the lesser of (i) the amount necessary to cause the Reserve Test to be
satisfied and (ii) Collateral Proceeds remaining after application as provided
in clauses (i) through (ix) of the Priority of Payments.
"Reserve Test": A test satisfied on a Quarterly Payment Date
if the sum of (a) the amounts credited to the Reserve Account, (b) the
unutilized portion of the Enron Class II Purchase Commitment and the Class C
Note Purchase Commitment and (c) the Project Distributions Reserved is at least
equal to the Required Reserve Amount.
"Retention Amount": On the Investment Termination Date, the
amount credited to the Excess Spread Account which is used to satisfy the
Credit Support Tests and Rating Condition as of such date and on any date after
the Investment Termination Date,
(a) the greater of (i) zero and (ii) the greater of (x) the
Retention Amount as of the Investment Termination Date minus the
Retention Percentage of the amount of principal which has been
received on the Project Loans since the Investment Termination Date
and (y) the amount, if any, that if added to the amount credited to
the Reserve Account, would satisfy the Reserve Test
plus
(b) amounts, if any, designated to be retained in such account
by the holders of the Class I Interests, at their option, in
accordance with the Partnership Agreement.
"Retention Percentage": A fraction, determined on the
Investment Termination Date, the numerator of which is the sum of the Unused
Enron Commitments and the Retention Amount and the denominator of which is the
Aggregate Project Loan Balance.
"S&P Credit Support Test": A test satisfied on any date of
determination if Net Senior Debt is less than or equal to the Maximum Senior
Indebtedness, after giving effect to the funding in full of a Project Loan
proposed to be funded, amounts to be withdrawn from or credited to the
Uncommitted TIP Account, Allocations or drawings under the Backup Facility, the
proposed issuance of Class A Notes or Class C Notes or the addition to, or
reduction of, the Class C Note Purchase Commitment and amounts credited to the
Excess Spread Account for the purpose of satisfying this test and the Rating
Condition.
"S&P Region": Each of (a) Latin America and the Caribbean
(other than countries rated "AA" or higher by S&P), (b) Chile and Colombia
(other than countries rated
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"AA" or higher by S&P), (c) Southeast Asia and Korea (other than countries
rated "AA" or higher by S&P), (d) India and Pakistan (other than countries
rated "AA" or higher by S&P), (e) Sri Lanka, Bangladesh and Nepal (other than
countries rated "AA" or higher by S&P), (f) China, Hong Kong and Taiwan (other
than countries rated "AA" or higher by S&P), (g) Russia and CIS (other than
countries rated "AA" or higher by S&P), (h) Eastern and Central Europe and
Turkey (other than countries rated "AA" or higher by S&P), (i) North Africa and
the Middle East (other than countries rated "AA" or higher by S&P), (j)
Sub-Saharan Africa (other than countries rated "AA" or higher by S&P), (k)
South Africa (other than countries rated "AA" or higher by S&P), (l) Gulf
States (other than countries rated "AA" or higher by S&P), (m) Pacific Islands
(other than countries rated "AA" or higher by S&P) and (n) each country rated
"AA" or higher by S&P, in each case, as of the Closing Date.
"Sale": The meaning specified in Section 2.5(a) of the
Security Agreement.
"Sale Proceeds": All proceeds received as a result of sales
or other dispositions of Collateral pursuant to Section 2.5 of the Security
Agreement, net of any reasonable amounts expended by the Program Manager or the
Collateral Agent in connection with such sale or other disposition.
"Scheduled Investment Termination Date": ________, 2003 [five
years after the Closing Date].
"Scheduled Payment": With respect to any Project Loan or
Permitted Investment, for each Due Date, the scheduled payment of principal
and/or interest with respect to such Project Loan or Permitted Investment as
calculated pursuant to Article 7 of the Common Agreement.
"Secured Obligations": As of any date, all indebtedness,
liabilities and obligations of the Issuers of whatsoever nature and however
evidenced (including, but not limited to, principal, interest, fees, penalties,
indemnities and legal and other expenses, whether due after acceleration or
otherwise), to the Secured Parties under or pursuant to all Outstanding Class A
Notes, Class B Notes and Class C Notes, the Indenture, the Liquidity Facility,
the Backup Facility, the Security Documents, the Hedging Agreements or any
other Financing Document, whether direct or indirect, primary or secondary,
fixed or contingent, now or hereafter arising.
"Secured Party": Each of the Class A Noteholders, Class B
Noteholders, Class C Noteholders, the Liquidity Lenders, the Backup Lenders,
the Hedge Counterparties, the Collateral Agent and the Representatives.
"Securities Account": An account to which a Financial Asset
is or may be credited in accordance with an agreement under which the Person
maintaining the account undertakes to treat the Person for whom the account is
maintained as entitled to exercise the rights that comprise the Financial
Asset.
"Securities Act": The United States Securities Act of 1933,
as amended and the rules promulgated thereunder.
-45-
93
"Securities Entitlement": Is acquired by a Person if a
Securities Intermediary: (a) indicates by book entry that a Financial Asset
has been credited to the Person's Securities Account; (b) receives a Financial
Asset from the Person or acquires a Financial Asset for the Person and, in
either case, accepts it for credit to the Person's Securities Account; or (c)
becomes obligated under other law, regulation or rule to credit a Financial
Asset to the Person's Securities Account; provided that if a Securities
Intermediary holds a Financial Asset for another Person, and the Financial
Asset is registered in the name of, payable to the order of, or specially
Indorsed to the other Person, and has not been Indorsed to the Securities
Intermediary or in blank, the other Person is treated as holding the Financial
Asset directly rather than as having a Securities Entitlement with respect to
the Financial Asset.
"Securities Intermediary": (a) A Clearing Corporation; or (b)
a Person, including a bank or broker, that in the ordinary course of its
business maintains Securities Accounts for others and is acting in that
capacity.
"Security": Except as otherwise provided in Section 8-103 of
the UCC, means an obligation of an issuer or a share, participation or other
interest in an issuer or in property or an enterprise of an issuer: (a) which
is represented by a Security Certificate in bearer or registered form, or the
transfer of which may be registered upon books maintained for that purpose by
or on behalf of the issuer; (b) which is one of a class or series or by its
terms is divisible into a class or series of shares, participations, interests
or obligations; and (c) which either (i) is, or is of a type, dealt in or
traded on securities exchanges or securities markets; or (ii) is a medium for
investment and by its terms expressly provides that it is a security governed
by Article 8 of the UCC.
"Security Agreement": The Security Agreement dated as of
___________, 1998, among the Issuers, the Collateral Agent and the Account
Bank.
"Security Certificate": A certificate representing a
Security.
"Security Documents": Individually and collectively, the
Security Agreement and any financing statements required by the Security
Agreement and any of the other agreements or documents entered into on or prior
to or after the Closing Date which provides any lien, charge or security
interest to the Secured Parties (or any of them) to secure the Secured
Obligations, including in each case any amendments to the foregoing in
accordance with the terms thereof and of the Common Agreement.
"Security Interest": Each security interest and lien granted
pursuant to Section 2.1 of the Security Agreement.
"Senior Coverage Test": A test satisfied on any date of
determination if the Senior Overcollateralization Ratio on such date is at
least equal to __% of the Target Senior Overcollateralization Ratio.
"Senior Lenders": The Class A Noteholders, the Liquidity
Lenders and the Backup Lenders.
-46-
94
"Senior Overcollateralization Ratio": As of any date of
determination, the ratio calculated by dividing:
(a) the sum of (i) the Project Loan Balance for each
non-Defaulted Project Loan, (ii) for each Defaulted Project Loan, the
excess of (x) the Project Loan Balance therefor over (y) the Issuer
Determined Loss for such Defaulted Project Loan, (iii) the Uncommitted
TIP Account Balance corresponding to all non-defaulted Temporary
Investments in the Uncommitted TIP Account and (iv) for each defaulted
Temporary Investment, the excess of (x) the principal balance of such
Temporary Investment over (y) the Assumed Loss Amount for such
Temporary Investment,
by
(b) the sum of (i) the aggregate outstanding principal amount
of the Class A Notes and (ii) the Backup Facility Balance.
"Senior Secured Obligation": As of any date, all
indebtedness, liabilities and obligations of the Issuer and/or the Co-Issuer of
whatsoever nature and however evidenced (including, but not limited to,
principal, interest (including interest that accrues subsequent to the
commencement of any bankruptcy, insolvency or similar proceedings with respect
to such Person whether or not a claim for post-filing interest is allowed in
such proceeding), fees, penalties, indemnities and legal and other expenses,
whether due after acceleration or otherwise) to the Senior Secured Parties.
"Senior Secured Party": Each of the Class A Noteholders, the
Liquidity Lenders, the Backup Lenders and the Hedge Counterparties.
"Series": With respect to Class A Notes and Class B Notes,
Notes issued by the Issuers on the same date pursuant to the Indenture or a
Supplemental Indenture relating to such series.
"Shortfall": The meaning specified in Section 4.1(b) of the
Security Agreement.
"South and Central America": The meaning specified in Section
1.2 of the Enron Support Agreement.
"Standard & Poor's" or "S&P": Standard & Poor's Ratings
Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Standard & Poor's Industry": Each industry found in
Table [ ] hereto.
"Standard & Poor's Rating": With respect to any Project Loan
or a Temporary Investment, the rating by Standard & Poor's of that Project Loan
or Temporary Investment, which rating may be a private letter rating; provided,
that if the Project Loan is being paid in a currency other than U.S. dollars,
the rating shall take into consideration the Currency Hedging Arrangements
necessary to cover currency risk, each such rating as subsequently updated by
S&P in accordance with the Financing Documents.
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95
"Stated Maturity": With respect to (i) any security, the date
specified in such security, (ii) any Note, the date specified in such Note and
in Section 2.2 of the Indenture, as the fixed date on which the final payment
of principal of such Note is due and payable, or, if such date is not a
Business Day, the next following Business Day, (iii) the Backup Facility, the
date specified as such in the applicable Backup Facility Loan Agreement or
under the applicable Funding Availability Note (in each case as such date may
be extended pursuant to the terms thereof) and (iv) the Liquidity Facility, the
date specified as such in the Liquidity Facility Loan Agreement or under the
applicable Liquidity Commitment Note (in each case as such date may be extended
pursuant to the terms thereof).
"Subordinate Event of Default": The occurrence of a Deferral
Event and the continuation thereof for 45 days.
"Subordinate Interests": The meaning specified in Section 3.1
of the Intercreditor Agreement.
"Subsequent Closing Date": The meaning specified in Section
2.9(a) of the Indenture.
"Support": The meaning specified in the Enron Support
Agreement.
"Support Notes": The meaning specified in the Enron Support
Agreement.
"Supplemental Indenture": An indenture supplemental to the
Indenture executed by the Issuers and the Trustee pursuant to Article 8 of the
Indenture.
"Target Note Redemption Amount": In respect of any Project
Loan subject to an Equity Disposition or a Refinancing, an amount equal to the
sum of the principal of such Project Loan or the related Intermediate Funding
Loan, as applicable, plus the present value, discounted at the weighted average
rate of interest currently payable on the Class A Notes and the Class B Notes
and the Backup Facility (the "Debt Rate"), of the amounts of interest, if any,
that would have been received on such Project Loan in excess of the Debt Rate
assuming such Equity Disposition or Refinancing had not occurred.
"Target Senior Overcollateralization Ratio": On any date is
calculated by dividing (a) the Calculated Asset Balance by (b) the Calculated
Senior Debt Balance, so long as the Calculated Senior Debt Balance is greater
than zero.
"Target Total Overcollateralization Ratio": On any date is
calculated by dividing
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96
(a) the Calculated Asset Balance
by
(b) the Calculated Total Debt Balance, so long as the
Calculated Total Debt Balance is greater than zero.
"Tax Event": A final determination that the Issuer is subject
to U.S. federal income tax on a net income basis.
"Tax Redemption Trigger Date": The meaning specified in
Section 10.3(a)(iv) of the Common Agreement.
"Temporary Investments": The Uncommitted TIP Investments
and/or Committed TIP Investments.
"TIP Accounts": The Committed TIP Account and the Uncommitted
TIP Account.
"TIP Account Balance": The Uncommitted TIP Account Balance or
the Committed TIP Account Balance, as applicable.
"TIP Advisor": The Person designated as manager under a TIP
Investment Management Agreement.
"TIP Diversity Score": On any date of determination, a score
calculated by summing up the Industry Diversity Scores. An Industry Diversity
Score is calculated for underlying assets issued by borrowers or issuers
located in the U.S. and other OECD countries and other countries, whose
sovereign debt is rated at least "Aa2" by Moody's. The Industry Diversity
Score is calculated as follows:
(i) For purposes of calculating the TIP Diversity Score,
any borrowers and issuers affiliated with one another will be
considered one borrower or issuer.
(ii) An "Issuer Par Amount" is calculated for each issuer
represented in the underlying assets by summing the par amounts of all
underlying assets in the Collateral issued by that issuer or an
affiliate of that issuer.
(iii) An "Average Par Amount" is calculated by summing the
Issuer Par Amounts and dividing by the sum of the number of issuers.
(iv) An "Equivalent Unit Score" is calculated for each
issuer by taking the lesser of (A) one and (B) the Issuer Par Amount
for such issuer divided by the Average Par Amount.
(v) An "Aggregate Industry Equivalent Unit Score" is then
calculated for each of the Moody's Industry groups, by summing the
Equivalent Unit Scores for each issuer in the industry.
-49-
97
(vi) An "Industry Diversity Score" is then established by
reference to Table 6 hereto for the related Aggregate Industry
Equivalent Unit Score; provided, that if any Aggregate Industry
Equivalent Unit Score falls between any two scores appearing on such
table, then the applicable Industry Diversity Score will be the lower
of the two Industry Diversity Scores in such Table.
"TIP Eligible Investments": Any Dollar-denominated investment
that, at the time it is delivered to the Collateral Agent (directly or through
a Securities Intermediary), is one or more of the following obligations or
securities:
(i) direct Registered obligations of, and Registered
obligations the timely payment of principal and interest on which is
fully and expressly guaranteed by, the United States of America or any
agency or instrumentality of the United States of America the
obligations of which are expressly backed by the full faith and credit
of the United States of America;
(ii) demand and time deposits in, certificates of deposit
of, bankers' acceptances payable within 365 days of issuance by, or
Federal funds sold by, any depository institution or trust company
incorporated under the laws of the United States of America or any
state thereof and subject to supervision and examination by Federal
and/or state banking authorities so long as the commercial paper
and/or the debt obligations of such depository institution or trust
company (or, in the case of the principal depository institution in a
holding company system, the commercial paper or debt obligations of
such holding company) at the time of such investment or contractual
commitment providing for such investment have a credit rating of not
less than "A2" by Moody's or "A" by Standard & Poor's, in the case of
long-term debt obligations, or "P-1" by Moody's or "A-1" by Standard &
Poor's in the case of commercial paper and short-term debt
obligations;
(iii) unleveraged repurchase obligations with respect to
(a) any security described in clause (i) above or (b) any other
Registered security issued or guaranteed by an agency or
instrumentality of the United States of America (in each case without
regard to the Stated Maturity of such security), in either case
entered into with a depository institution or trust company (acting as
principal) described in clause (ii) above or entered into with a
corporation (acting as principal) whose long-term rating is not less
than "A2" by Moody's or "A" by Standard & Poor's or whose short-term
credit rating is "P-1" by Moody's or "A-1" by Standard & Poor's at the
time of such investment;
(iv) Registered debt securities bearing interest or sold
at a discount issued by any corporation incorporated under the laws of
the United States of America or any state thereof that have a credit
rating of not less than "A1" by Moody's or "A+" by Standard & Poor's
at the time of such investment or contractual commitment providing for
such investment;
(v) commercial paper or other short-term obligations with
a maturity of not more than 365 days from the date of issuance and
having at the time of such investment a credit rating of not less than
"P-1" by Moody's or "A-1" by Standard & Poor's;
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98
(vi) a Reinvestment Agreement issued by any bank (if
treated as a deposit by such bank), or a Registered Reinvestment
Agreement issued by any insurance company or other corporation or
entity, in each case that has a credit rating of not less than "P-1"
by ▇▇▇▇▇'▇ or "A-1" by Standard & Poor's; and
(vii) Dollar-denominated senior term loans, revolving
credits or other senior liabilities of United States borrowers or
corporate issuers located in countries whose long-term sovereign
rating is at least "Aa2" by ▇▇▇▇▇'▇ and "AA" by S&P, in each case,
with direct or implied ratings of at least "A2" by ▇▇▇▇▇'▇ and "A" by
S&P.
"TIP Investment Management Agreement": The [Investment
Management] Agreement between the Issuer and a TIP Advisor which agreement
satisfies the Committed TIP Investment Policies and Uncommitted TIP Investment
Policies.
"Total Assets": The sum of (i) the Aggregate Project Loan
Balance and (ii) the Uncommitted TIP Account Balance.
"Total Overcollateralization Ratio": As of any date of
determination, the ratio calculated by dividing:
(a) the sum of (i) the Project Loan Balance for each
non-Defaulted Project Loan, (ii) for each Defaulted Project Loan, the
excess of (x) the Project Loan Balance therefor over (y) the Issuer
Determined Loss for such Defaulted Project Loan, (iii) the Uncommitted
TIP Account Balance corresponding to all non-defaulted Temporary
Investments in the Uncommitted TIP Account and (iv) for each defaulted
Temporary Investment, the excess of (x) the principal balance of such
Temporary Investment over (y) the Assumed Loss Amount for such
Temporary Investment,
by
(b) the sum of (i) the aggregate outstanding principal amount
of the Class A Notes and the Class B Notes and (ii) the Backup
Facility Balance.
"Transaction Expenses": All expenses of the Issuers related
to the issuance of the Class A Notes and Class B Notes, including, without
limitation, (i) underwriting fees, (ii) filing and listing fees associated with
the registration and sale of the Class A Notes and Class B Notes, (iii) legal,
accounting and other consultant fees associated with the registration and sale
of the Class A Notes and Class B Notes, (iv) expenses associated with the
marketing and sales of the Class A Notes and Class B Notes, (v) printing costs
for registration statements and other similar documents, (vi) Trustee and
Collateral Agent fees related to such issuance and (vii) rating agency fees.
"Transaction Documents": The Financing Documents and the
Management Agreement.
"Transferee": The meaning specified in Section 2.1(b) of the
Common Agreement.
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"Transfer Agent": The Person or Persons, which may be the
Issuer, authorized by the Issuer to exchange or register the transfer of Notes.
"Trust Indenture Act": The Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed, except as otherwise
provided in Section 8.5 of the Indenture; provided, however, that in the event
the Trust Indenture Act of 1939 is amended after such date, "Trust Indenture
Act" means, to the extent required by any such amendment, the Trust Indenture
Act of 1939 as so amended.
"Trust Officer": When used with respect to the Trustee, any
officer within the Corporate Trust Office (or any successor group of the
Trustee) authorized to act for and on behalf of the Trustee, including any vice
president, assistant vice president or other officer of the Trustee customarily
performing functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred at the Corporate Trust Office because of such person's knowledge of
and familiarity with the particular subject.
"Trustee": Chase Texas, solely in its capacity as trustee
under the Indenture and the other Financing Documents.
"Trustee Document": Any Financing Document to which the
Trustee is a party.
"Trustee's Fee": The accrued and unpaid fees and expenses of
the Trustee and any custodian used by the Trustee to hold Project Loans and any
other amount due and owing to the Trustee by the Issuer hereunder or under the
Trustee's Fee Letter, in each case, to the extent the Trustee is entitled to
payment thereof pursuant to Section 6.8(a) of the Indenture.
"Trustee's Fee Letter": The fee letter agreement dated
[_______], 1998 between the Issuer and the Trustee.
"UCC": The Uniform Commercial Code as in effect in the State
of New York.
"Uncertificated Security": A Security that is not represented
by a certificate.
"Uncommitted TIP Account": The account designated the
Uncommitted TIP Account and established pursuant to Section 3.3(a) of the
Security Agreement which account shall initially be account number
[______________] and shall include any successor or replacement accounts
thereof.
"Uncommitted TIP Account Balance": The principal balance of
investments credited to the Uncommitted TIP Account.
"Uncommitted TIP Investment": The meaning specified under the
definition of "Uncommitted TIP Investment Policies" in this Appendix A.
"Uncommitted TIP Investment Policies": Amounts credited to or
re-invested in the Uncommitted TIP Account shall be invested in a portfolio of
(a) U.S. Government Securities, (b) TIP Eligible Investments and (c) Dollar-
denominated senior term loans, revolving credits or
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100
other senior liabilities of United States borrowers or corporate issuers
located in countries whose long-term sovereign debt obligations are rated at
least "Aa2" by ▇▇▇▇▇'▇ or "AA" by S&P, in each case, with direct or implied
ratings of at least "Baa3" by ▇▇▇▇▇'▇ and "BBB-" by S&P. Each of the
investments described in the foregoing clauses (a) through (c) (each, an
"Uncommitted TIP Investment") shall satisfy the following criteria:
(i) all Uncommitted TIP Investments shall mature no later
than, or prior to, one (1) year from the date that they were acquired,
provided that in no event shall any Uncommitted TIP Investment mature
after the Scheduled Investment Termination Date;
(ii) with respect to amounts re-invested in Uncommitted
TIP Investments, such investments shall have the same or higher rating
as the maturing Uncommitted TIP Investments;
(iii) the Uncommitted TIP Account Balance represented by
Uncommitted TIP Investments referred to in clause (a) above shall be
zero after the 12-month period from the Closing Date; and
(iv) Uncommitted TIP Investments referred to in clause (a)
above shall have a TIP Diversity Score of at least 20 and an Industry
Concentration Factor no greater than 10%, while complying with the
restrictions in Section 2.5(a)(i)(A) of the Security Agreement with
respect to the Sale of Collateral;
provided that, Uncommitted TIP Investments shall not include any
interest-only security, any security purchased at a price in excess of
100% of the par value thereof, unless such security is non-callable to
maturity (unless callable with a make-whole premium), or any security
whose repayment is subject to substantial non-credit related risk as
determined in the sole judgment of the Program Manager.
"Underlying Instruments": The credit agreement, loan
agreement or other agreement pursuant to which a Project Loan, Intermediate
Funding Loan or Permitted Investment has been issued or created or may in the
future be made, issued or extended and each other agreement that governs the
terms of or secures the obligations represented by such Project Loan,
Intermediate Funding Loan or Permitted Investment or of which the holders of
such Project Loan, Intermediate Funding Loan or Permitted Investment are the
beneficiaries.
"Underwriters": Chase Securities Inc. and ▇▇▇▇▇▇ Brothers, in
their capacities as Underwriters under the Underwriting Agreement.
"Underwriting Agreement": The agreement dated as of
_________, 1998 between the Issuers and the Underwriters, relating to the offer
and sale of the Class A Notes and the Class B Notes comprising the Initial
Notes.
"United States" or "U.S.": The United States of America,
including the states thereof and the District of Columbia.
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"Unscheduled Principal Payments": With respect to the Project
Loans, principal repayments received as a result of optional redemptions or
prepayments.
"Unused Enron Commitments": The sum of the (i) amount of
unfunded Enron Class II Purchase Commitment, (ii) the aggregate unfunded Class
C Note Purchase Commitment and (iii) for the purpose of the definition of
"▇▇▇▇▇'▇ Credit Support Test" and the "S&P Credit Support Test" in this
Appendix A, the aggregate unfunded Credit Support Test Commitments.
"U.S. Government Obligations": The direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States (including any agency or instrumentality thereof) for the payment
of which the full faith and credit of the United States is pledged and which
are not callable at the issuer's option.
"U.S. Government Securities": Any security issued or
guaranteed as to principal or interest by the United States, or by a person
controlled or supervised by and acting as an instrumentality of the Government
of the United States pursuant to authority granted by the Congress of the
United States; or any certificate of deposit for any of the foregoing.
"Valuation Report": The meaning specified in Section 6.1(a)
of the Common Agreement.
"Weighted Average ▇▇▇▇▇'▇ Rating": On any date of
determination made in respect of Project Loans or Temporary Investments, the
rating associated with the ▇▇▇▇▇'▇ Rating Factor closest to, but not less than,
the number obtained by (i) summing the products obtained by multiplying the
Project Loan Balance of each Project Loan or the Principal Balance of each
Temporary Investment, as applicable, by its ▇▇▇▇▇'▇ Rating Factor, (ii)
dividing such sum by the Aggregate Project Loan Balance or TIP Account Balance,
as applicable, and (iii) rounding the result up to the nearest whole number.
The "▇▇▇▇▇'▇ Rating Factor" relating to any Project Loan or a Temporary
Investment is the number assigned in the table below opposite the Rating of
such Project Loan or Temporary Investment:
▇▇▇▇▇'▇ ▇▇▇▇▇'▇
▇▇▇▇▇'▇ Rating ▇▇▇▇▇'▇ Rating
Rating Factor Rating Factor
------ ------ ------ ------
Aaa 1 Ba1 940
Aa1 10 Ba2 1,350
Aa2 20 Ba3 1,780
Aa3 40 B1 2,220
A1 70 B2 2,720
A2 120 B3 3,490
A3 180 Caa1 4,770
Baa1 260 Caa2 6,500
Baa2 360 Caa3 8,070
Baa3 610 Ca 10,000
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102
ANNEX A
TABLE 1: TIP Table
--------------------------------------------------------------------------------------------------------------------------------
TIP WEIGHTED AVERAGE ▇▇▇▇▇'▇ RATINGS OF UNCOMMITTED TIP INVESTMENTS
DIVERSITY
SCORE
BA2 BA1 ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇
--------------------------------------------------------------------------------------------------------------------------------
7
10
15
20
25
30
35
40
--------------------------------------------------------------------------------------------------------------------------------
-1-
TABLE 2: Project Loan Table
--------------------------------------------------------------------------------------------------------------------------------
DIVERSITY WEIGHTED AVERAGE ▇▇▇▇▇'▇ RATINGS OF PROJECT LOANS
SCORE
B3 B2 B1 BA3 BA2 BA1 BAA3 BAA2
--------------------------------------------------------------------------------------------------------------------------------
2
3
4
5
6
7
8
9
10
--------------------------------------------------------------------------------------------------------------------------------
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103
TABLE 3: ▇▇▇▇▇'▇ Assumed Net Interest Margin Table
--------------------------------------------------------------------------------------------------------------------------------
DIVERSITY WEIGHTED AVERAGE ▇▇▇▇▇'▇ RATINGS OF PROJECT LOANS
SCORE
B3 B2 B1 BA3 BA2 BA1 BAA3 BAA2
--------------------------------------------------------------------------------------------------------------------------------
2
3
4
5
6
7
8
9
10
--------------------------------------------------------------------------------------------------------------------------------
TABLE 4: Base Net Interest Margin Table
--------------------------------------------------------------------------------
WEIGHTED AVERAGE ▇▇▇▇▇'▇ BASE NET INTEREST
RATINGS OF PROJECT LOANS MARGIN
--------------------------------------------------------------------------------
B3 %
B2 %
B1 %
Ba3 %
Ba2
▇▇▇
▇▇▇▇
Baa2
--------------------------------------------------------------------------------
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104
TABLE 5: Industry Classification Table
--------------------------------------------------------------------------------------------------------------
1. Aerospace and defense 21. Food/drug retailers
Aircraft manufacturer/components 22. Food products
Arms and Ammunition 23. Food service
2. Air transport Food service/restaurants
3. Automotive Vending
Manufacturers 24. Forest products
Parts and equipment Building materials
Tire and rubber Paper products and containers
4. Beverage and tobacco 25. Health care
5. Broadcast radio and television Medical equipment/supply
6. Brokerage/securities dealers/investment Hospital management
houses 26. Home furnishings
7. Building and development Appliances
Builders Furniture, fixtures
Land development/real estate Housewares
Mobile homes 27. Hotels/motels/inns and casinos
REITs 28. Industrial equipment
8. Business equipment and services Machinery
Graphic arts Manufacturing/industrial
Office equipment/computers Specialty instruments
Data processing service bureaus 29. Insurance
Computer software 30. Leisure
9. Cable television Leisure goods
10. Chemical/plastics Leisure activities/motion pictures
Coatings/paints/varnishes 31. Nonferrous metals/minerals
11. Clothing/textiles Aluminum producers
12. Conglomerates Other metal/mineral producers
13. Containers and glass products Mining (including coal)
14. Cosmetics/toiletries 32. Oil and gas
15. Drugs Producers/refiners
16. Ecological services and equipment Gas pipelines
Waste disposal services and equipment 33. Publishing
17. Electronics/electric 34. Rail industries
Equipment Railroads
Component Rail equipment
18. Equipment leasing 35. Retailers (other than food/drug)
Auto leasing/rentals 36. Steel
Equipment leasing 37. Surface transport
Data processing equipment Shipping/shipbuilding
Service/leasing Trucking
19. Farming/agriculture 38. Telecommunications/cellular communications
Agricultural products and equipment 39. Utilities
Fertilizers Electric
20. Financial intermediaries Local gas
Banking Water
Finance companies
--------------------------------------------------------------------------------------------------------------
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105
TABLE 6: Diversity Score Table
Aggregate Aggregate Aggregate Aggregate
Industry Industry Industry Industry Industry Industry Industry Industry
Equivalent Diversity Equivalent Diversity Equivalent Diversity Equivalent Diversity
Unit Score Score Unit Score Score Unit Score Score Unit Score Score
------------ ----------- ------------ ----------- ------------ ----------- ------------ -----------
0.0000 0.0000 5.0500 2.7000 10.1500 4.0200 15.2500 4.5300
0.0500 0.1000 5.1500 2.7333 10.2500 4.0300 15.3500 4.5400
0.1500 0.2000 5.2500 2.7667 10.3500 4.0400 15.4500 4.5500
0.2500 0.3000 5.3500 2.8000 10.4500 4.0500 15.5500 4.5600
0.3500 0.4000 5.4500 2.8333 10.5500 4.0600 15.6500 4.5700
0.4500 0.5000 5.5500 2.8667 10.6500 4.0700 15.7500 4.5800
0.5500 0.6000 5.6500 2.9000 10.7500 4.0800 15.8500 4.5900
0.6500 0.7000 5.7500 2.9333 10.8500 4.0900 15.9500 4.6000
0.7500 0.8000 5.8500 2.9667 10.9500 4.1000 16.0500 4.6100
0.8500 0.9000 5.9500 3.0000 11.0500 4.1100 16.1500 4.6200
0.9500 1.0000 6.0500 3.0250 11.1500 4.1200 16.2500 4.6300
1.0500 1.0500 6.1500 3.0500 11.2500 4.1300 16.3500 4.6400
1.1500 1.1000 6.2500 3.0750 11.3500 4.1400 16.4500 4.6500
1.2500 1.1500 6.3500 3.1000 11.4500 4.1500 16.5500 4.6600
1.3500 1.2000 6.4500 3.1250 11.5500 4.1600 16.6500 4.6700
1.4500 1.2500 6.5500 3.1500 11.6500 4.1700 16.7500 4.6800
1.5500 1.3000 6.6500 3.1750 11.7500 4.1800 16.8500 4.6900
1.6500 1.3500 6.7500 3.2000 11.8500 4.1900 16.9500 4.7000
1.7500 1.4000 6.8500 3.2250 11.9500 4.2000 17.0500 4.7100
1.8500 1.4500 6.9500 3.2500 12.0500 4.2100 17.1500 4.7200
1.9500 1.5000 7.0500 3.2750 12.1500 4.2200 17.2500 4.7300
2.0500 1.5500 7.1500 3.3000 12.2500 4.2300 17.3500 4.7400
2.1500 1.6000 7.2500 3.3250 12.3500 4.2400 17.4500 4.7500
2.2500 1.6500 7.3500 3.3500 12.4500 4.2500 17.5500 4.7600
2.3500 1.7000 7.4500 3.3750 12.5500 4.2600 17.6500 4.7700
-4-
106
DIVERSITY SCORE TABLE (CONT'D)
Aggregate Aggregate Aggregate Aggregate
Industry Industry Industry Industry Industry Industry Industry Industry
Equivalent Diversity Equivalent Diversity Equivalent Diversity Equivalent Diversity
Unit Score Score Unit Score Score Unit Score Score Unit Score Score
------------ ----------- ------------ ----------- ------------ ---------- ------------ ------------
2.4500 1.7500 7.5500 3.4000 12.6500 4.2700 17.7500 4.7800
2.5500 1.8000 7.6500 3.4250 12.7500 4.2800 17.8500 4.7900
2.6500 1.8500 7.7500 3.4500 12.8500 4.2900 17.9500 4.8000
2.7500 1.9000 7.8500 3.4750 12.9500 4.3000 18.0500 4.8100
2.8500 1.9500 7.9500 3.5000 13.0500 4.3100 18.1500 4.8200
2.9500 2.0000 8.0500 3.5250 13.1500 4.3200 18.2500 4.8300
3.0500 2.0333 8.1500 3.5500 13.2500 4.3300 18.3500 4.8400
3.1500 2.0667 8.2500 3.5750 13.3500 4.3400 18.4500 4.8500
3.2500 2.1000 8.3500 3.6000 13.4500 4.3500 18.5500 4.8600
3.3500 2.1333 8.4500 3.6250 13.5500 4.3600 18.6500 4.8700
3.4500 2.1667 8.5500 3.6500 13.6500 4.3700 18.7500 4.8800
3.5500 2.2000 8.6500 3.6750 13.7500 4.3800 18.8500 4.8900
3.6500 2.2333 8.7500 3.7000 13.8500 4.3900 18.9500 4.9000
3.7500 2.2667 8.8500 3.7250 13.9500 4.4000 19.0500 4.9100
3.8500 2.3000 8.9500 3.7500 14.0500 4.4100 19.1500 4.9200
3.9500 2.3333 9.0500 3.7750 14.1500 4.4200 19.2500 4.9300
4.0500 2.3667 9.1500 3.8000 14.2500 4.4300 19.3500 4.9400
4.1500 2.4000 9.2500 3.8250 14.3500 4.4000 19.4500 4.9500
4.2500 2.4333 9.3500 3.8500 14.4500 4.4500 19.5500 4.9600
4.3500 2.4667 9.4500 3.8750 14.5500 4.4600 19.6500 4.9700
4.4500 2.5000 9.5500 3.9000 14.6500 4.4700 19.7500 4.9800
4.5500 2.5333 9.6500 3.9250 14.7500 4.4800 19.8500 4.9900
4.6500 2.5667 9.7500 3.9500 14.8500 4.4900 19.9500 5.0000
4.7500 2.6000 9.8500 3.9750 14.9500 4.5000
4.8500 2.6333 9.9500 4.0000 15.0500 4.5100
4.9500 2.6667 10.0500 4.0100 15.1500 4.5200
-5-