EXHIBIT NO. 10.164
SHARE PLEDGE AGREEMENT
among
PANDA OF NEPAL
as Pledgor,
WILMINGTON TRUST COMPANY, not in its individual
capacity but solely as Trustee under the
Trust and Retention Agreement,
as Pledgee,
and
BHOTE KOSHI POWER COMPANY PRIVATE LIMITED
Dated as of the Closing Date
TABLE OF CONTENTS
PRELIMINARY STATEMENTS 1
DEFINITIONS 1
ARTICLE 1
UNDERTAKINGS
Section 1.1. Guarantee 2
Section 1.2. Security for Obligations 3
Section 1.3. Delivery of Pledged Collateral 3
Section 1.4. Waiver 4
Section 1.5. Further Assurances 4
Section 1.6. Voting Rights; Dividends, etc 4
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
Section 2.1. Power and Authorization; Enforceable
Obligations 5
Section 2.3. Government Approval 6
Section 2.4. Ownership 6
Section 2.5. First Lien 6
ARTICLE 3
COVENANTS
Section 3.1. Existence 6
Section 3.2. Restriction on Sale and Transfer of
Pledged Interest 6
Section 3.3. Defense of Pledged Collateral 7
Section 3.4. No Modification 7
ARTICLE 4
POWER OF ATTORNEY
Section 4.1. Pledgee as Attorney-in-Fact 7
Section 4.2. Pledgee May Perform 7
Section 4.3. Reasonable Care 7
ARTICLE 5
REMEDIES
Section 5.1. Substitution for Pledgor 8
Section 5.2. Sale of Pledged Collateral 8
Section 5.3. Conveyances 9
Section 5.4. Payments Received 9
Section 5.5. Application of Proceeds 9
Section 5.6. Discharge of Purchaser 9
Section 5.7. No Liability 9
Section 5.8. Remedies Cumulative 10
ARTICLE 6
ADDITIONAL RIGHTS OF THE PLEDGEE
Section 6.1. Further Assurances 10
Section 6.2. Pledgee 10
ARTICLE 7
INDEMNIFICATION; LIMITATION OF LIABILITY
Section 7.1. Indemnification 10
ARTICLE 8
WAIVER
Section 8.1. Waivers 11
ARTICLE 9
TERMINATION
Section 9.1. Termination 12
ARTICLE 10
MISCELLANEOUS
Section 10.1. Notices 12
Section 10.2. Governing Law; Submission to
Jurisdiction; Venue 13
Section 10.3. Benefit of Agreement 14
Section 10.4. No Waiver; Remedies Cumulative 14
Section 10.5. Severability 14
Section 10.6. Language 14
Section 10.7. Headings Descriptive 15
Section 10.8. Amendment or Waiver 15
Section 10.9. Counterparts 15
SCHEDULE A
SHAREHOLDINGS 17
SCHEDULE B
Form No. (4)
Application for Recording Mortgage of Shares 18
SCHEDULE C
Form No. (5)
Application for Transfer of Shares 19
SHARE PLEDGE AGREEMENT
SHARE PLEDGE AGREEMENT (this "Agreement"), dated as of
the Closing Date, among PANDA OF NEPAL, an exempted company with
limited liability organized and existing under the laws of the
Cayman Islands (the "Pledgor"), WILMINGTON TRUST COMPANY, not in
its individual capacity but solely as Trustee under the Trust and
Retention Agreement (the "Pledgee"), and BHOTE KOSHI POWER
COMPANY PRIVATE LIMITED, a private limited liability company
registered under the Nepalese Company Act, 2021 (the "Company").
PRELIMINARY STATEMENTS
As of the date hereof, the Pledgor is the legal and
beneficial owner of five hundred seventy-four thousand nine
hundred ninety-two (574,992) Shares of the Company, which Shares
are set forth opposite the Pledgor's name in Schedule A attached
hereto (such Shares, collectively, the "Pledged Shares").
The Company has been granted the right to build, own
and operate a 36MW (nominal net) hydroelectric power plant in the
Sindhupalchok District of Nepal.
IFC is willing to provide financing for the power
plant, pursuant to that certain IFC Investment Agreement dated as
of the Closing Date between the Company and IFC (the "IFC
Investment Agreement"), but only if the Pledgor shall pledge its
Shares pursuant to this Agreement.
DEG is willing to provide financing for the power
plant, pursuant to that certain DEG Investment Agreement dated as
of the Closing Date between the Company and DEG (the "DEG
Investment Agreement," and together with the IFC Investment
Agreement, the "Investment Agreement"), but only if the Pledgor
shall pledge its shares pursuant to this Agreement. (IFC and DEG
are hereinafter collectively referred to as the "Lenders" and
individually as a "Lender").
The Company, IFC and DEG have entered into that certain
Investment Agreement General Conditions dated as of the Closing
Date (the "General Conditions").
It is a condition precedent to the obligations of each
of IFC and DEG under the Investment Agreement that this Agreement
shall have been entered into by the parties hereto.
NOW, THEREFORE, in consideration of each of the Lenders
entering into the Investment Agreement, and to induce each of the
Lenders to make disbursements thereunder, the Pledgor agrees as
follows:
DEFINITIONS
For all purposes of this Agreement (i) capitalized
terms not otherwise defined herein shall have the meanings set
forth in Schedule A to the General Conditions and (ii) the
principles of construction set forth in Schedule A to the General
Conditions shall apply.
ARTICLE 1
UNDERTAKINGS
Section 1.1. Guarantee.
(a) Subject to Section 7.1(c) hereof, the Pledgor
hereby irrevocably and unconditionally guarantees to the Pledgee,
for the benefit of the Lenders, the timely performance by the
Company of all of its obligations under the Loan Documents and
the other Principal Documents as and when required thereunder and
the payment by the Company when due of any and all sums owed
under the Loan Documents and the other Principal Documents (the
"Guaranteed Obligations").
(b) No compromise, alteration, amendment,
modification, extension, renewal, release or other change of, or
waiver, consent or other action in respect of any liability or
obligation under or in respect of, or of any of the terms,
covenants or conditions of the Investment Agreement or any other
Principal Document, or any Security, shall in any way alter or
affect the obligations of the Pledgor hereunder (other than a
written waiver of any obligation hereunder executed by the
Pledgee at the direction of the Lenders).
(c) The obligations of the Pledgor under this Section
1.1 are absolute and unconditional, subject to the limitations
set forth in Section 7.1(c) hereof.
(d) The Pledgor hereby irrevocably waives, to the
extent it may do so under applicable law, any defense based on
the adequacy of a remedy at law which may be asserted as a bar to
the remedy of specific performance in any action brought against
it.
(e) The Pledgor irrevocably waives, to the extent it
may do so under applicable law, any protection to which it may be
entitled under bankruptcy, liquidation, winding up, insolvency or
similar laws of any jurisdiction in the event of a Company
Bankruptcy. In the event a trustee in bankruptcy or debtor-in-
possession takes any action (including without limitation the
institution of any action, suit or other proceeding) in a Company
Bankruptcy for the purpose of enforcing the obligations of the
Pledgor under this Agreement, the Pledgor hereby agrees, to the
extent it may do so under applicable law, that it will not assert
any defense, claim or counterclaim denying liability hereunder on
the basis that this Agreement is an executory contract that
cannot be assumed, assigned or enforced. If a Company Bankruptcy
shall occur, the Pledgor, to the extent it may do so under
applicable law, shall reconfirm its prepetition waiver of any
protection to which it may be entitled under such laws and, to
give effect to such waiver, the Pledgor consents to the
assumption and enforcement of each provision of this Agreement by
the debtor-in-possession or the Company's trustee in bankruptcy,
as the case may be.
(f) The Pledgor hereby irrevocably waives all rights
of subrogation which may have arisen or may hereafter arise in
connection with this Section 1.1 to the claims of the Trustee or
the Lenders against the Company and all contractual, statutory or
common law rights of reimbursement, contribution or indemnity or
other similar such right from the Company which may otherwise
have arisen in connection with this Section 1.1.
(g) The Pledgor hereby assigns, transfers,
hypothecates and pledges to the Pledgee, for the benefit of the
Lenders, as security for its timely and punctual payment and
performance of the Guaranteed Obligations and payment and
performance when due of any and all sums owed by and all
obligations of the Pledgor hereunder (collectively, the
"Obligations") and grants a first lien on, and prior perfected
security interest in, all of the Pledgor's right, title and
interest in, to and under the following, whether now owned or
hereafter acquired (collectively, the "Pledged Collateral"):
(i) the Pledged Shares and the
certificates representing such Pledged
Shares, and all dividends, cash, instruments
and other property from time to time
received, receivable or otherwise distributed
in respect of or in exchange for any or all
of such Pledged Shares;
(ii) all additional Shares of and
other securities of the Company from time to
time acquired by the Pledgor in any manner,
and the certificates representing such
additional Shares and other securities, and
all dividends, cash, instruments, and other
property from time to time received,
receivable or otherwise distributed in
respect of or in exchange for any or all of
such Shares; and
(iii) all the Pledgor's right,
title and interest to, in and under the
Project Agreement, including without
limitation (A) all rights of the Pledgor to
receive moneys due from time to time
thereunder or pursuant thereto and (B) all
claims of the Pledgor for damages for breach
thereof or default thereunder.
(h) This Agreement and the grant of the security
interest made hereby are for collateral purposes only, and
neither the Pledgee nor the Lenders shall by virtue of this
Agreement or by their exercise of any rights hereunder be deemed
to have any liability for any contractual obligations of the
Pledgor or of the Company.
Section 1.2. Security for Obligations. This Agreement
secures the payment and performance of all Obligations, as
defined in Section 1.1(g) hereof.
Section 1.3. Delivery of Pledged Collateral.
(a) All certificates or instruments representing or
evidencing the Pledged Collateral shall be delivered to and held
by the Pledgee on behalf of the Lenders pursuant hereto and shall
be in suitable form for transfer by delivery, or shall be
accompanied by duly executed instruments of transfer or
assignment in blank, together with an executed Form 4 (the form
of which is attached hereto as Schedule B), all in form and
substance satisfactory to the Pledgee and the Lenders. The
Pledgor hereby instructs the Company, and the Company hereby
agrees, to promptly deliver directly to the Pledgee all stock
certificates, instruments or other documents evidencing or
constituting Pledged Collateral issued by the Company after the
date of this Agreement, marked to show recordation by the Company
of the pledge thereof to the Trustee. If any such certificates,
instruments or documents are delivered to the Pledgor, the
Pledgor shall hold in trust for the Pledgee upon receipt, and
immediately thereafter transfer to the Pledgee, any such
certificates, instruments or documents (except, until the Pledgee
has requested a transfer of the Pledged Collateral pursuant to
Section 1.6(b) hereof, cash dividends and interest paid in
respect of the Pledged Collateral). The Pledgor shall also
promptly deliver to the Company executed Form(s) 4 with respect
to all Pledged Collateral and to the Pledgee duly executed
instruments of transfer or assignment in blank relating to all
Pledged Collateral delivered to the Pledgee.
(b) The Pledgee shall have the right, at any time, in
its discretion and upon notice to the Pledgor, following the
occurrence and continuance of an Event of Default, to file a Form
5 (the form of which is attached hereto as Schedule C) with
respect to the Pledged Collateral with the Company and to
transfer to or to register in the names of the Lenders or any of
their nominees any or all of the Pledged Collateral. In
addition, the Pledgee shall have the right, if an Event of
Default shall have occurred and be continuing, to exchange
certificates or instruments representing or evidencing Pledged
Collateral for certificates or instruments of smaller or larger
denominations.
Section 1.4. Waiver. The Pledgor hereby waives
diligence, presentment, demand of any kind, filing of claims with
a court in the event of receivership or bankruptcy, protests of
any kind, and all setoffs and counterclaims, to the extent
permitted by applicable law. Upon the occurrence and continuance
of an Event of Default, the Pledgee may proceed directly and at
once, upon reasonable prior notice to the Pledgor if practicable
under the circumstances, against the Pledged Collateral to
collect and recover the full amount or any portion of the
Obligations so due and payable, without first proceeding against
the Pledgor or the Company or against any other security or
collateral provided by the Pledgor or the Company with respect to
the Obligations.
Section 1.5. Further Assurances. The Pledgor agrees
that at any time and from time to time, at its expense, the
Pledgor shall promptly execute and deliver all further
instruments and documents (including, without limitation, any
additional pledge agreement or security agreement), and take all
further action that, in the opinion of the Pledgee or the
Lenders, is necessary in order to perfect and protect any
security interest in the Pledged Collateral granted or purported
to be granted hereby or to enable the Pledgee to exercise and
enforce its rights and remedies hereunder with respect to the
Pledged Collateral or any part thereof.
Section 1.6. Voting Rights; Dividends, etc.
(a) So long as no Event of Default shall have occurred
and be continuing, the Pledgee shall not request the transfer of
the Pledged Shares into its name in the Company's share register
and, until the Pledgee has requested such a transfer in
accordance with Section 1.6(b) hereof:
(i) the Pledgor shall be entitled
to exercise any and all voting and other
consensual rights pertaining to the Pledged
Collateral or any part thereof for any
purpose not inconsistent with the terms of
this Agreement, the Investment Agreement or
the other Loan Documents; and
(ii) the Pledgor shall be entitled
to receive and retain any and all cash
dividends and interest paid in respect of the
Pledged Collateral.
(b) Upon the occurrence and during the continuation of
an Event of Default, the Pledgee may require the Pledged Shares
to be transferred into its name in the Company's share register
and thereupon:
(i) all rights of the Pledgor to
exercise the voting and other consensual
rights which the Pledgor would otherwise be
entitled to exercise pursuant to Section
1.6(a)(i) hereof and to receive the dividends
and interest payments which the Pledgor would
otherwise be authorized to receive and retain
pursuant to Section 1.6(a)(ii) hereof shall
cease, and all such rights shall thereupon
become vested in the Pledgee, which shall
thereupon have the sole right to exercise
such voting and other consensual rights and
to receive and hold as Pledged Collateral
such dividends and interest payments; and
(ii) all dividends and interest
payments which are received by the Pledgor
contrary to the provisions of
Section 1.6(b)(i) hereof shall be received in
trust for the benefit of the Pledgee, shall
be segregated from other funds of the Pledgor
and shall be forthwith paid over to the
Pledgee as Pledged Collateral in the same
form as so received (with any necessary
endorsement).
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
The Pledgor hereby represents and warrants as of the
date hereof:
Section 2.1. Power and Authorization; Enforceable
Obligations.
(a) The Pledgor has full power and authority and the
legal right to conduct its business as now conducted and as
proposed to be conducted by it, to execute, deliver and perform
this Agreement and any other Principal Documents to which it is a
party and to take all actions necessary to complete the
transactions contemplated by this Agreement and any such other
Principal Document. The Pledgor has taken all necessary action
to authorize the transactions contemplated hereby on the terms
and conditions of this Agreement and any other Principal Document
to which it is a party, and to authorize the execution, delivery
and performance of this Agreement and any other Principal
Document to which it is a party.
(b) Each of this Agreement and any other Principal
Documents to which the Pledgor is a party has been duly executed
and delivered by the Pledgor and constitutes the legal, valid and
binding obligation of the Pledgor.
Section 2.2. No Legal Bar. The execution, delivery
and performance of this Agreement and any other Principal
Documents to which the Pledgor is a party will not violate any
requirement of law applicable to, or any contractual obligation
of, the Pledgor. The execution, delivery and performance of this
Agreement or any other Principal Document to which the Pledgor is
a party will not result in, or require the creation or imposition
of any Lien on any of the properties or revenues of the Pledgor
pursuant to any requirement of law or contractual obligation,
except for the Liens created or permitted by this Agreement. No
approvals or consents of any trustee or any holder of any
Indebtedness of the Pledgor are required in connection with the
execution, delivery and performance by the Pledgor of this
Agreement or any other Principal Document to which it is a party,
except such approvals or consents as have been duly obtained and
are in full force and effect.
Section 2.3. Government Approval. No Governmental
Approvals or other consents or approvals (except those which have
been obtained or made and are in full force and effect or which
are listed in Schedule 4.1(d) of the General Conditions and are
not now required to be obtained) are required to be obtained by
the Pledgor in connection with the execution, delivery and
performance of this Agreement.
Section 2.4. Ownership. The Pledgor is the legal and
beneficial owner of the Pledged Shares free and clear of any Lien
created by the Pledgor except for the security interest created
by this Agreement. The Pledgor has no knowledge of any Lien,
other than the Lien created by this Agreement, on the Pledged
Collateral.
Section 2.5. First Lien. The pledge of the Pledged
Shares pursuant to this Agreement and delivery thereof to the
Pledgee in Wilmington, Delaware creates a valid and perfected
first priority security interest therein, securing the payment of
the Obligations.
ARTICLE 3
COVENANTS
So long as the Obligations remain outstanding or the
Lenders have any obligation under any Loan Document, the Pledgor
covenants and agrees with the Pledgee and the Lenders as follows:
Section 3.1. Existence. The Pledgor shall preserve
and maintain (a) its legal existence and form and (b) all of its
rights, privileges and franchises necessary for the maintenance
of its existence and the performance of its obligations
hereunder.
Section 3.2. Restriction on Sale and Transfer of
Pledged Interest. The Pledgor shall not without the prior
written consent of the Lenders (i) sell, transfer, convey or
otherwise dispose of, or grant any option with respect to or
pledge any interest in, any ownership interest in the Company,
except if such sale, transfer, conveyance or other disposition is
not prohibited by, and would not result in a breach of, any
Principal Document and the recipient agrees in writing to be
bound by the terms of, and become a party to, this Agreement (or
a separate Share Pledge Agreement in respect of the Pledged
Collateral of such recipient), (ii) consent to or approve (A) the
cancellation of any of the Pledged Shares or other Pledged
Collateral or (B) the creation or authorization of any ownership
interest in the Company other than the interests in existence on
the date hereof, except in accordance with or as contemplated by
the Subscription Agreements, the Share Retention and Project
Funds Agreement, the Shareholders' Agreement and the Investment
Agreement, or (iii) create any Lien upon or with respect to any
of the Pledged Collateral owned by the Pledgor, other than the
Lien created pursuant to this Agreement.
Section 3.3. Defense of Pledged Collateral. The
Pledgor warrants and will defend the Pledgee's right, title and
security interest in and to the Pledged Collateral against the
claims of any Person that purports to have rights created by,
through or under the Pledgor.
Section 3.4. No Modification. The Pledgor shall not
amend or modify, or participate in the amendment or modification
of, any provision of the Company's Memorandum of Association or
Articles of Association (other than amendments to increase the
Company's share capital or as required by law, in either of which
cases prompt written notice of the amendment shall be given to
each of the Lenders) without the express written consent of the
Lenders. The Pledgor shall not amend or modify the Shareholders'
Agreement without the express written consent of the Lenders.
ARTICLE 4
POWER OF ATTORNEY
Section 4.1. Pledgee as Attorney-in-Fact. The Pledgor
does hereby make, constitute and appoint the Pledgee, with full
power of substitution, as the Pledgor's attorney-in-fact, with
full power and authority, in its own name or in the name, place
and stead of the Pledgor, or otherwise, (i) if an Event of
Default shall have occurred and be continuing, to exercise all
voting, consent, managerial and other rights related to the
Pledged Collateral, and (ii) if an Event of Default shall have
occurred and be continuing, from time to time, generally to do,
at the Pledgee's request and the Pledgor's expense, all acts and
things which the Pledgee or the Lenders may deem necessary to
accomplish the purposes of this Agreement, including, without
limitation, to receive, endorse and collect all instruments made
payable to the Pledgor representing any payment or other dividend
in respect of the Pledged Collateral or any part thereof and to
give full discharge for the same, all as fully and effectually as
the Pledgor might or could do; and the Pledgor hereby ratifies
all that said attorney shall lawfully do or cause to be done by
virtue hereof. This power of attorney is coupled with an
interest and shall be irrevocable for the term of this Agreement.
Any attempted revocation of the powers of attorney granted herein
shall be null and void. There are no conditions or requirements
imposed on the Pledgee's exercise of the powers of attorney other
than as set forth herein.
Section 4.2. Pledgee May Perform. If an Event of
Default shall have occurred and be continuing, the Pledgee may
itself perform, or cause performance of, any agreement contained
herein, and the expenses of the Pledgee or such other performing
party incurred in connection therewith shall be payable by the
Pledgor; provided, however, that the Pledgee shall have no
obligation to perform or cause performance of any of the
Pledgor's obligations hereunder or under any other Principal
Document to which it is a party.
Section 4.3. Reasonable Care. The Pledgee shall be
deemed to have exercised reasonable care in the custody and
preservation of the Pledged Collateral in its possession if the
Pledged Collateral is accorded treatment substantially equal to
that which the Pledgee accords its own property.
ARTICLE 5
REMEDIES
Section 5.1. Substitution for Pledgor. If an Event of
Default shall have occurred and be continuing, then, in addition
to any other rights and remedies provided for herein or otherwise
available to it under any Loan Document or by law, the Pledgee
may, and upon the request of the Lenders shall, exercise the
powers of attorney set forth in Section 4.1 of this Agreement,
and shall be entitled, without limitation, to exercise the
following rights, which the Pledgor hereby agrees to be
commercially reasonable:
Section 5.2. Sale of Pledged Collateral. If an Event
of Default shall have occurred and be continuing, then, in
addition to any other rights and remedies provided for herein or
otherwise available to it, the Pledgee may without any further
demand, advertisement or notice (except as expressly provided in
this Section 5.2), exercise all the rights and remedies of a
secured party under the Code as in effect in any relevant
jurisdiction (whether or not the Code applies to the Pledged
Collateral), and in addition may sell, give an option or options
to purchase, contract to sell or otherwise dispose of the Pledged
Collateral, or any part thereof, as hereinafter provided and may
sell, lease, finance, refinance, mortgage or convey the Pledged
Collateral. The Pledged Collateral may so be sold or otherwise
disposed of in one or more sales, at public or private sale,
conducted by any officer or agent of, or auctioneer or attorney
for, the Pledgee, at any exchange or broker's board or at the
Pledgee's place of business or elsewhere, for cash, upon credit
or for other property, for immediate or future delivery, and at
such price or prices and on such terms (including, without
limitation, a requirement that any purchase of all or any part of
the Pledged Collateral for investment be without any intention to
make a distribution thereof) as the Pledgee shall, in its sole
discretion, deem appropriate. Either of the Lenders may be the
purchasers of any or all of the Pledged Collateral so sold at any
such sale and thereafter hold the same, absolutely free from any
right or claim of whatsoever kind. The Pledgee may in its sole
discretion, at any such sale, restrict the prospective bidders or
purchasers as to their number, nature of business and investment
intention. Upon any such sale, the Pledgee shall have the right
to deliver, assign and transfer to the purchaser thereof
(including either of the Lenders) the Pledged Collateral so sold.
Except if and to the extent otherwise prohibited by law, each
purchaser (including either of the Lenders) at any such sale
shall hold the Pledged Collateral so sold absolutely free from
any claim or right of whatsoever kind, including any equity or
right of redemption of the Pledgor. The Pledgee shall give the
Pledgor at least ten (10) days' notice (which the Pledgor agrees
is reasonable notification) of any such public or private sale.
Such notice shall state the time and place fixed for any public
sale and the time after which any private sale is to be made.
Any such public sale shall be held at such time or times within
ordinary business hours as the Pledgee shall fix in the notice of
such sale. At any such sale the Pledged Collateral may be sold
in one lot as an entirety or in separate parcels. The Pledgee
shall not be obligated to make any sale pursuant to any such
notice. The Pledgee may, without notice or publication, adjourn
any public or private sale or cause the same to be adjourned from
time to time by announcement at the time and place fixed for such
sale, and any such sale may be made at any time or place to which
the same may be so adjourned without further notice or
publication. In case of any sale of all or any part of the
Pledged Collateral on credit or for future delivery, the Pledged
Collateral so sold may be retained by the Pledgee until the full
selling price is paid by the purchaser thereof, but the Pledgee
shall not incur any liability in case of the failure of such
purchaser to take up and pay for the Pledged Collateral so sold,
and, in case of any such failure, such Pledged Collateral may
again be sold pursuant to the provisions hereof.
Section 5.3. Conveyances. The Pledgee may as attorney-
in-fact pursuant and subject to Section 4.1 hereof, in the name
and stead of the Pledgor, make and execute all conveyances,
assignments and transfers of the Pledged Collateral sold pursuant
to Section 5.2 hereof, and the Pledgor hereby ratifies and
confirms all that the Pledgee, as said attorney-in-fact, shall do
by virtue hereof. Nevertheless, the Pledgor shall, if so
requested by the Pledgee, ratify and confirm any sale or sales by
executing and delivering to the Pledgee, or to such purchaser or
purchasers, all such instruments as may, in the judgment of the
Pledgee, be advisable for the purpose.
Section 5.4. Payments Received. Until the Pledgee has
requested a transfer in accordance with Section 1.6(b) hereof,
the Pledgor, subject to the terms of the Loan Documents, shall be
entitled to exercise any and all rights, remedies and powers of
the Pledgor under, and receive and retain any amounts paid or
payable to the Pledgor under or pursuant to, the Project
Agreement; thereafter, the Pledgee shall be entitled to exercise
the Pledgor's rights, remedies or powers, and receive and retain
amounts, under the Project Agreement, and all payments received
by the Pledgor under or in connection with the Project Agreement
shall be held in trust for the Pledgee, shall be segregated from
the other funds of the Pledgor and shall, forthwith upon receipt
by the Pledgor, be turned over to the Pledgee or the Designee in
the same form as received by the Pledgor (duly endorsed by the
Pledgor to the Pledgee or the Designee, as appropriate).
Section 5.5. Application of Proceeds. All cash
proceeds received by the Pledgee in respect of any sale or lease
of, collection from, or other realization upon all or any part of
the Pledged Collateral may be held by the Pledgee as Collateral
for the Obligations and/or applied to the payment of the
Obligations. Any surplus of such cash proceeds held by the
Pledgee in excess of or remaining after payment in full of the
Obligations shall be paid over to the Pledgor or whomsoever the
Pledgee shall determine to be lawfully entitled thereto.
Section 5.6. Discharge of Purchaser. The receipt by
the Pledgee of the purchase money paid at any sale made by it
shall be a sufficient discharge therefor, sold as aforesaid; and
no purchaser (or representative or assign of any purchaser),
after paying such purchase money, shall be bound to see to the
application of such purchase money or any part thereof or in any
manner whatsoever be answerable for any loss, misapplication or
non-application of any such purchase money, or any part thereof,
or be bound to inquire as to the authorization, necessity,
expediency or regularity of any such sale.
Section 5.7. No Liability. Neither the Pledgee nor
the Lenders shall incur any liability as a result of the sale of
the Pledged Collateral, or any part thereof, at any private sale
conducted in a commercially reasonable manner. The Pledgor
hereby waives, to the full extent permitted by applicable law,
all claims, damages and demands against the Pledgee and the
Lenders arising out of the repossession, retention or sale of the
Pledged Collateral, including, without limitation, any claims
against the Pledgee and the Lenders, arising by reason of the
fact that the price at which the Pledged Collateral, or any part
thereof, was sold was less than may have been obtained at a
public sale or was less than the aggregate amount of the
Obligations so long as such sale shall have been conducted in
accordance with this Agreement. The foregoing is not intended to
release any party from liability for any claim, damage or demand
resulting from its gross negligence or willful misconduct.
Section 5.8. Remedies Cumulative. Each and every
right and remedy of the Pledgee shall, to the extent permitted by
law, be cumulative and shall be in addition to any other remedy
given hereunder or under any other Loan Document or any other
document now or hereafter existing at law or in equity or by
statute.
ARTICLE 6
ADDITIONAL RIGHTS OF THE PLEDGEE
Section 6.1. Further Assurances. If the Pledgee shall
determine to exercise its right to sell all or any of the Pledged
Collateral pursuant to Section 5.2 hereof, the Pledgor shall,
upon request of the Pledgee, at the Pledgor's own expense do or
cause to be done all such other acts and things as may be
necessary to make such sale of the Pledged Collateral or any part
thereof valid and binding and in compliance with any requirement
of law.
Section 6.2. Pledgee. Wilmington Trust Company in
acting hereunder shall be entitled to the rights, protections and
immunities of the Trustee under the Trust and Retention
Agreement.
ARTICLE 7
INDEMNIFICATION; LIMITATION OF LIABILITY
Section 7.1. Indemnification.
(a) Subject to the limitations set forth in Section
7.1(c) hereof, the Pledgor shall indemnify each of the Pledgee
and each of the Lenders from and against any and all claims,
losses and liabilities growing out of or resulting from the
failure by the Pledgor to perform or observe any of the
provisions hereof, including, without limitation, (i) the sale
of, collection from, or other realization upon, the Pledged
Collateral, or any part thereof, in connection with such failure,
or (ii) the exercise or enforcement of any of the rights of the
Pledgee or the Lenders, except for claims, losses or liabilities
resulting from such party's gross negligence or willful
misconduct. Subject as aforesaid, the Pledgor will upon demand
pay to the Pledgee or the Lenders the amount of any and all
expenses, including the fees and expenses of its and their
respective counsel and of any experts and agents, which such
party may incur in connection with the failure by the Pledgor to
perform or observe any of the provisions hereof, including,
without limitation, (i) the sale of, collection from, or other
realization upon, the Pledged Collateral, or any part thereof, or
(ii) the exercise or enforcement of any of the rights of the
Pledgee or the Lenders.
(b) If any obligation of the Pledgor arising under
this Article 7, as limited by the provisions of Section 7.1(c)
hereof, shall be prohibited or unenforceable in any jurisdiction
then, as to such jurisdiction and subject to such limitations,
the Pledgor hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible
under applicable law.
(c) The Pledgor is willing to enter into this
Agreement and to guarantee the Guaranteed Obligations, and to
secure such guarantee by granting to the Pledgee a Lien on the
Pledged Collateral, only if the Pledgee agrees, on behalf of
itself and the Lenders, to limit the personal liability of the
Pledgor under this Agreement as provided in this Section 7.1(c).
Accordingly, and notwithstanding anything in this Agreement to
the contrary, all payments to be made by the Pledgor under this
Agreement in respect of the Guaranteed Obligations and other
Obligations shall be made or payable only from and to the extent
of the Pledged Collateral and all proceeds, of whatever nature,
of the realization thereof, and the Pledgee, on behalf of itself
and the Lenders, agrees that it and the Lenders will look solely
to the Pledged Collateral and such proceeds for payments to be
made by the Pledgor under this Agreement and that the Pledgor
shall not, save as expressly hereinafter provided in this
Section 7.1(c), be otherwise personally liable under this
Agreement for any Guaranteed Obligations or other Obligations;
provided, however, that (i) the provisions of this Section 7.1(c)
shall not prevent the Pledgee from exercising any and all of its
remedies provided in this Agreement with respect to the Pledged
Collateral or provided in any other agreement or document, and
(ii) the Pledgor shall remain personally liable for, and shall
indemnify the Pledgee and the Lenders against, any and all
claims, losses and liabilities growing out of or resulting from,
(y) the failure by the Pledgor to perform its obligations under
Section 1.3, Article 3 or Section 10.2 hereof or (z) any material
inaccuracy of any representation and warranty set forth in
Article 2 hereof, except to the extent arising out of the gross
negligence or willful misconduct of the Pledgee.
ARTICLE 8
WAIVER
Section 8.1. Waivers. To the fullest extent it may
lawfully so agree, the Pledgor agrees that it will not at any
time insist upon, claim, plead, or take any benefit or advantage
of any appraisement, valuation, stay, extension, moratorium,
redemption or similar law now or hereafter in force in order to
prevent, delay or hinder the enforcement hereof or the absolute
sale of any part of the Pledged Collateral; the Pledgor for
itself and all who claim through it, so far as it or they now or
hereafter lawfully may do so, hereby waives the benefit of all
such laws, and all right to have the Pledged Collateral
marshalled upon any foreclosure hereof, and agrees that any court
having jurisdiction to foreclose this Agreement may order the
sale of the Pledged Collateral as an entirety. Without limiting
the generality of the foregoing, the Pledgor hereby (i)
authorizes the Pledgee, for the benefit of the Lenders, in its
sole discretion and without notice to or demand upon the Pledgor
and without otherwise affecting the obligations of the Pledgor
hereunder, from time to time to take and hold other collateral
for payment of any Obligations, or any part thereof, and to
exchange, enforce or release such other collateral or any part
thereof, and to accept and hold any endorsement or guarantee of
payment of the Obligations or any part thereof, and to release or
substitute any endorser or guarantor or any other person granting
security for or in any other way obligated upon any Obligations
or any part thereof and (ii) waives and releases any and all
right to require the Pledgee or the Lenders to collect any of the
Obligations from any specific item or items of the Pledged
Collateral or from any other party liable as guarantor or in any
other manner in respect of any of the Obligations or from any
collateral for any of the Obligations.
ARTICLE 9
TERMINATION
Section 9.1. Termination. If (i) at any time all
Obligations owing to the Lenders have been paid in full and (ii)
a period of one hundred twenty (120) days (or such other period
as may be applicable with respect to preference or similar
periods under applicable bankruptcy, insolvency or similar laws)
has elapsed since the condition set out in clause (i) is
satisfied without any court determining that the Company is
insolvent or, if such determination is made within that time, the
Lenders are reasonably satisfied that no payment made to the
Lenders or the Trustee by the Company will be set aside as a
consequence thereof under any law relating to bankruptcy,
insolvency or similar matters, then this Agreement shall
terminate; provided that the provisions of Article 7 shall
survive such termination. At the time of such termination, the
Pledgee at the request and expense of the Pledgor, will promptly
execute and deliver to the Pledgor a proper instrument or
instruments acknowledging the satisfaction and termination of
this Agreement, and will duly assign, transfer and deliver to the
Pledgor such of the Pledged Collateral as has not theretofore
been sold or otherwise applied or released pursuant to this
Agreement, together with any moneys at the time held by the
Pledgee hereunder on account of the Pledged Collateral and not
otherwise applied to the payment of the Obligations.
ARTICLE 10
MISCELLANEOUS
Section 10.1. Notices. All notices, demands, requests
and other communications provided for hereunder shall be in
writing and shall be deemed to have been given (a) when presented
personally, (b) when sent by overnight courier service, on the
Business Day following the date of delivery to such courier
service, or such later day as demonstrated by a bona fide receipt
therefor, or (c) when transmitted by facsimile, upon
acknowledgment of receipt by the recipient. Either party may
designate from time to time by written notice to the other party
another address to which notices are to be sent.
For Pledgor:
Address: Panda of Nepal
▇/▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ Church Street
Grand Cayman
Cayman Islands, R.W.I.
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Address: Panda Energy International, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
For Pledgee:
Address: Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Section 10.2. Governing Law; Submission to
Jurisdiction; Venue.
(a) This Agreement and the rights and obligations of
the parties hereunder shall be construed in accordance with and
be governed by the laws of the State of New York without regard
to the conflicts of laws provisions thereof (other than Sections
5-1401 and 5-1402 of the General Obligations Law of the state of
New York). Any legal action or proceeding against the Pledgor
with respect to this Agreement or any other Principal Document to
which the Pledgor is a party may be brought in the courts of the
State of New York in the Borough of Manhattan or of the United
States for the Southern District of New York and, by execution
and delivery of this Agreement, the Pledgor hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The
Pledgor agrees that a judgment in any such action or proceeding
shall be conclusive and binding upon it, and may be enforced in
any other jurisdiction, including without limitation in Nepal, by
a suit upon such judgment, a certified copy of which shall be
conclusive evidence of the judgment. The Pledgor hereby
irrevocably designates, appoints and empowers CT Corporation
System, with offices on the date hereof at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its designee, appointee and agent to
receive, accept and acknowledge for and on its behalf, and in
respect of its property, service of any and all legal process,
summons, notices and documents which may be served in any such
action or proceeding. If for any reason such designee, appointee
and agent shall cease to be available to act as such, the Pledgor
agrees to designate a new designee, appointee and agent in New
York City on the terms and for the purposes of this provision
satisfactory to the Pledgee. The Pledgor further irrevocably
consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail,
postage prepaid, to it, at its address set forth opposite its
signature below, such service to become effective ten (10) days
after such mailing. Nothing herein shall affect the right of the
Pledgee to serve process in any other manner permitted by law or
to commence legal proceedings or otherwise proceed against the
Pledgor in Nepal or in any other jurisdiction.
(b) The Pledgor hereby irrevocably waives any
objection which it may now or hereafter have to the laying of
venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement or any other Principal
Document to which it is a party brought in the courts referred to
in clause (a) above and hereby further irrevocably waives and
agrees not to plead or claim in any such court that any action or
proceeding brought by the Pledgee in any such court has been
brought in an inconvenient forum.
(c) The Pledgor acknowledges and agrees that the
activities contemplated by this Agreement are commercial in
nature rather than governmental or public, and therefore
acknowledges and agrees that the right of immunity does not and
will not arise with respect to such activities or in any legal
action or proceeding arising out of or relating to this Agreement
in respect of itself and its properties.
Section 10.3. Benefit of Agreement. This Agreement
shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the
Pledgor, the Pledgee, and all future holders of the Pledged
Shares or other Pledged Collateral; provided, however, that the
Pledgor may not assign or transfer any of its rights or
obligations under this Agreement without the prior written
consent of the Pledgee. Each of the Lenders may transfer, assign
or grant its rights hereunder in connection with an assignment or
transfer of all or any part of its interest in its Commitment or
the IFC Loans or the DEG Loan, as the case may be, in accordance
with the Investment Agreement.
Section 10.4. No Waiver; Remedies Cumulative. No
failure or delay on the part of the Pledgee in exercising any
right, power or privilege hereunder or under any other Loan
Document, and no course of dealing between the Pledgor and the
Pledgee, shall impair any such right, power or privilege or
operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder or under any
other Loan Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights, powers and remedies
provided under this Agreement or in any other Loan Document are
cumulative and not exclusive of any rights, powers or remedies
which the Pledgee may otherwise have. No notice to or demand on
the Pledgor in any case shall entitle the Pledgor to any other or
further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Pledgor to any other or
further action in any circumstances without notice or demand.
Section 10.5. Severability. Any provision of this
Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability but that shall
not invalidate the remaining provisions of this Agreement or
affect such provision in any other jurisdiction.
Section 10.6. Language. All documents to be furnished
or communications to be given or made under this Agreement shall
be in the English language, or, if in another language, shall be
accompanied by a translation into English certified by a
representative of the Pledgor or the Pledgee, as the case may be,
which translation shall be the governing version between the
Pledgor and the Pledgee.
Section 10.7. Headings Descriptive. The headings of
the several Articles and sections of this Agreement are inserted
for convenience only and shall not in any way affect the meaning
or construction of any provision of this Agreement.
Section 10.8. Amendment or Waiver. Neither this
Agreement nor any of the terms hereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or
termination is in writing signed by all of the parties hereto.
Section 10.9. Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so
executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be duly executed and acknowledged by their
respective officers or representatives hereunto duly authorized
as of the date first above written.
PANDA OF NEPAL
By:
Name:
Title:
WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as
Trustee under the Trust and Retention Agreement
By:
Name:
Title:
BHOTE KOSHI POWER COMPANY PRIVATE LIMITED
By:
Name:
Title:
SCHEDULE A
SHAREHOLDINGS*
Holder Class of Shares Par Value No. of Shares
Panda of Nepal Ordinary Shares 100 Rs. 574,992
SCHEDULE B
Form No. (4)
Application for Recording Mortgage of Shares
To: Bhote Koshi Power Company Private Limited
KHA ▇-▇▇▇
▇▇▇▇▇▇▇▇, Tahachal
Kathmandu, Nepal
Sir:
We have mortgaged shares of R.S. 100 each of Bhote Koshi Power
Company Private Limited, registered in the name of
_________________ from Share No. ___________ to _______________
totalling ________ shares of the value of Rs. ____________ to
Wilmington Trust Company, not in its individual capacity but
solely as Trustee for International Finance Corporation and DEG-
Deutsche Investitions-und Entwicklungsgesellschaft mbH. We
herewith submit this application, along with a copy of the
related document and the share certificate(s). Please record the
matter of the mortgage of said shares in the Register of the
Company.
Dated:
Yours,
(Signature of the applicant)
Name: Panda of Nepal
Address: ▇/▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ Church Street
Grand Cayman
Cayman Islands, R.W.I.
SCHEDULE C
Form No. (5)
Application for Transfer of Shares
To: Bhote Koshi Power Company Private Limited
KHA ▇-▇▇▇
▇▇▇▇▇▇▇▇, Tahachal
Kathmandu, Nepal
Sir:
As _____________________________ has duly executed the deed
transferring its right over the shares of R.S. 100 each of Bhote
Koshi Power Company Private Limited registered in its name from
Share no. ________ to ___________, having received R.S.
______________ as consideration for the said shares, in our
favor. We, having agreed to be responsible for the profit and
loss relating to those shares, have submitted this application
along with one copy of the said deed and the share
certificate(s). Kindly transfer the ownership of said shares in
our name.
Yours,
(Signature of the purchaser)
Name:
Address:
Date:
_______________________________
* Prior to issuance and pledge of shares at the Financial
Closing Date.