EXHIBIT 10.124
PEC CASH COLLATERAL AGREEMENT
CASH COLLATERAL AGREEMENT dated as of April 22, 1997,
between PANDA ENERGY CORPORATION, a Texas corporation (the
"Pledgor") and BANKERS TRUST COMPANY, as Trustee (in such
capacity, the "Trustee") for the holders ("Holders") of
securities ("Securities") issued pursuant to the terms and
subject to the conditions of the Trust Indenture, dated as of
April 22, 1997 (as amended, supplemented or otherwise modified
from time to time, the "Company Indenture"), between Panda Global
Holdings, Inc., a Delaware corporation (the "Company") and the
Trustee and any Series Supplemental Indentures (as described in
the Company Indenture).
W I T N E S S E T H:
WHEREAS, the Company has issued Securities pursuant to the
Company Indenture in the form of a guarantee (the "Senior Secured
Notes Guarantee") of certain notes (the "Senior Secured Notes")
issued by Panda Global Energy Company, a subsidiary of the
Company (the "Issuer") in order to receive more favorable
financing terms for the sale of the Senior Secured Notes, and the
Pledgor has agreed to assign its rights to certain assets to the
Trustee;
WHEREAS, the Pledgor is an affiliate of the Company and of
the Issuer, and it is to the advantage of Pledgor to facilitate
the sale of Senior Secured Notes;
NOW, THEREFORE, in consideration of the premises and to
induce the Trustee to enter into the Company Indenture and to
induce the Initial Purchaser to purchase the Securities under the
Purchase Agreement dated April 11, 1997 (as it may be amended,
supplemented or otherwise modified from time to time, the
"Purchase Agreement") with the Issuer, the Company and Panda
Energy International, Inc., the Pledgor hereby agrees with the
Trustee, for the ratable benefit of the Holders, as follows:
1. Defined Terms. (a) Unless otherwise defined herein,
terms defined in the Company Indenture and used herein shall have
the meanings given to them in the Company Indenture.
(b) The following terms shall have the following meanings:
"Agreement": this PEC Cash Collateral Agreement, as the
same may be amended, modified or otherwise supplemented from time
to time.
"Cash Collateral": the collective reference to:
(a) all cash, instruments, securities and funds deposited
from time to time in the Cash Collateral Account, including,
without limitation, all Domestic Project Event Proceeds deposited
in the Cash Collateral Account and all cash or other money
proceeds of any property of the Pledgor that constitutes
collateral subject to a security interest for the benefit of the
Trustee under any Transaction Document;
(b) all investments of funds in the Cash Collateral Account
and all instruments and securities evidencing such investments;
and
(c) all interest, dividends, cash, instruments, securities
and other property received in respect of, or as proceeds of, or
in substitution or exchange for, any of the foregoing.
"Cash Collateral Account": the PEC Revenue Account.
"Code": the Uniform Commercial Code from time to time in
effect in the State of New York.
"Collateral": the collective reference to the Cash
Collateral and the Cash Collateral Account.
"Obligations": (i) the collective reference to the unpaid
principal, interest and premium, if any (including Liquidated
Damages and Additional Amounts, if any), on the Securities and
all other obligations and liabilities of the Company or the
Pledgor to the Trustee and the Holders of the Securities
(including, without limitation, interest accruing after the
filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the
Company or the Pledgor whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether
direct or indirect, absolute or contingent, due or to become due,
or now existing or hereafter incurred, which may arise under, out
of, or in connection with, the Company Indenture, any Series
Supplemental Indenture, any Senior Secured Notes Guarantee, any
other Securities, this Agreement, the other Transaction Documents
to which the Company is a party or any other document made,
delivered or given in connection therewith; and
(ii) all obligations and liabilities of the Pledgor which
may arise under or in connection with this Agreement or any other
Transaction Document to which the Pledgor is a party;
in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and
disbursements of counsel to the Trustee or the Holders that are
required to be paid by the Company or the Pledgor pursuant to the
terms of the Company Indenture or this Agreement or any other
Transaction Document.
(c) The words "hereof," "herein" and "hereunder" and words
of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement, and section and paragraph references are to this
Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such
terms.
2. Grant of Security Interest. As collateral security for
the prompt and complete payment and performance when due (whether
at the stated maturity, by acceleration or otherwise) of the
Obligations, the Pledgor hereby grants to the Trustee, for the
ratable benefit of the Holders, a security interest in the
Collateral.
3. Maintenance of Cash Collateral Account. (a) The Cash
Collateral Account shall be maintained until the Obligations have
been paid and performed in full.
(b) The Collateral shall be subject to the exclusive
dominion and control of the Trustee, which shall hold the Cash
Collateral and administer the Cash Collateral Account subject to
the terms and conditions of this Agreement and the Company
Indenture. The Pledgor shall have no right of withdrawal from
the Cash Collateral Account nor any other right or power with
respect to the Collateral, except as expressly provided herein.
4. Representations and Warranties. The Pledgor represents
and warrants to the Trustee that:
(a) The Pledgor has the corporate power and authority and
the legal right to execute and deliver, to perform its
obligations under, and to grant the security interest in the
Collateral pursuant to, this Agreement and has taken all
necessary corporate action to authorize its execution, delivery
and performance of, and grant of the security interest in the
Collateral pursuant to, this Agreement.
(b) This Agreement constitutes a legal, valid and binding
obligation of the Pledgor enforceable in accordance with its
terms and creates in favor of the Trustee a perfected, first
priority security interest in the Collateral, enforceable in
accordance with its terms, except in each case as affected by
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(c) The execution, delivery and performance of this
Agreement will not violate any provision of any Requirement of
Law or Contractual Obligation of the Pledgor and will not result
in 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 of the Pledgor, except as
contemplated hereby.
(d) No consent or authorization of, filing with, or other
act by or in respect of, any arbitrator or Governmental Authority
and no consent of any other Person (including, without
limitation, any stockholder or creditor of the Pledgor), is
required in connection with the execution, delivery, performance,
validity or enforceability of this Agreement.
(e) No litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority is pending or, to the
knowledge of the Pledgor, threatened by or against the Pledgor or
against any of its properties or revenues with respect to this
Agreement or any of the transactions contemplated hereby.
5. Covenants. The Pledgor covenants and agrees with the
Trustee that, except as the Trustee may otherwise consent in
accordance with the terms of the Company Indenture:
(a) The Pledgor will not, (1) sell, assign, transfer,
exchange, or otherwise dispose of, or grant any option with
respect to, the Collateral, or (2) create, incur or permit to
exist any Lien or option in favor of, or any claim of any Person
with respect to, any of the Collateral, or any interest therein,
except for the security interest created by this Agreement.
(b) The Pledgor will maintain the security interest created
by this Agreement as a first, perfected security interest and
will defend the right, title and interest of the Trustee and the
Holders of Securities in and to the Collateral against the claims
and demands of all Persons whomsoever. At any time and from time
to time, upon the written request of the Trustee, and at the sole
expense of the Pledgor, the Pledgor will promptly and duly
execute and deliver such further instruments and documents and
take such further actions as the Trustee reasonably may request
for the purposes of obtaining or preserving the full benefits of
this Agreement and of the rights and powers herein granted,
including, without limitation, financing statements under the
Code.
6. Investment of Cash Collateral. Collected funds on
deposit in the Cash Collateral Account shall be invested by the
Trustee pursuant to the terms of the Company Indenture.
7. Release of Cash Collateral. The Trustee shall release
the Cash Collateral in accordance with the terms of the Company
Indenture.
8. Remedies. (a) Upon the occurrence of an Event of
Default, the Trustee may, without notice of any kind, except for
notices required by law which may not be waived, apply the
Collateral, after deducting all reasonable costs and expenses of
every kind incurred in respect thereof or incidental to the care
or safekeeping of any of the Collateral or in any way relating to
the Collateral or the rights of the Trustee hereunder, including,
without limitation, reasonable attorneys' fees and disbursements
of counsel to the Trustee, to the payment in whole or in part of
the Obligations, in such order as the Trustee in its sole
discretion may elect, and only after such application and after
the payment by the Trustee of any other amount required by any
provision of law, including, without limitation, Section
9-504(1)(c) of the Code, need the Trustee account for the
surplus, if any, to the Pledgor. In addition to the rights,
powers and remedies granted to it under this Agreement and in any
other agreement securing, evidencing or relating to the
Obligations, the Trustee shall have all the rights, powers and
remedies available at law, including, without limitation, the
rights and remedies of a secured party under the Code. To the
extent permitted by law, the Pledgor waives presentment, demand,
protest and all notices (except notices specifically provided for
in any agreement securing, evidencing or relating to the
Obligations) of any kind and all claims, damages and demands it
may acquire against the Trustee or any Holder arising out of the
exercise by them of any rights hereunder.
(b) The Pledgor waives and agrees not to assert any rights
or privileges which it may acquire under Section 9-112 of the
Code. The Pledgor shall remain liable for any deficiency if the
proceeds of any sale or other disposition of the Collateral are
insufficient to pay the Obligations and the fees and
disbursements of any attorneys employed by the Trustee to collect
such deficiency.
9. No Subrogation. Notwithstanding any payment or payments
made by the Pledgor hereunder, or any setoff or application of
funds of the Pledgor by any Holder, or the receipt of any amounts
by the Trustee or any Holder with respect to any of the
Collateral, the Pledgor shall not be entitled to be subrogated to
any of the rights of the Trustee or any Holder against the
Company or against any other collateral security held by the
Trustee or any Holder for the payment of the Obligations, nor
shall the Pledgor seek any reimbursement from the Company in
respect of payments made by the Pledgor in connection with this
Agreement, or amounts realized by the Trustee or any Holder in
connection with the Collateral, until all amounts owing to the
Trustee and the Holders on account of the Obligations are paid in
full. If any amount shall be paid to the Pledgor on account of
such subrogation rights at any time when all of the Obligations
shall not have been paid in full, such amount shall be held by
the Pledgor in trust for the Trustee, segregated from other funds
of the Pledgor, and shall, forthwith upon receipt by the Pledgor,
be turned over to the Trustee in the exact form received by the
Pledgor (duly indorsed by the Pledgor to the Trustee, if
required) to be applied against the Obligations, whether matured
or unmatured, in such order as the Trustee may determine.
10. Amendments, etc. with respect to the Obligations;
Waiver of Rights. The Pledgor shall remain obligated hereunder,
and the Collateral shall remain subject to the security interest
created hereby, notwithstanding that, without any reservation of
rights against the Pledgor, and without notice to or further
assent by the Pledgor, any demand for payment of any of the
Obligations made by the Trustee or any Holder may be rescinded by
the Trustee or such Holder, and any of the Obligations continued,
and the Obligations, or the liability of the Company or any other
Person upon or for any part thereof, or any collateral security
or guarantee therefor or right of offset with respect thereto,
may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived,
surrendered, or released by the Trustee or any Holder, and the
Company Indenture, the Securities and the other Transaction
Documents executed and delivered in connection therewith may be
amended, modified, supplemented or terminated, in whole or part,
in accordance with their terms, and any guarantee, right of
offset or other collateral security at any time held by the
Trustee or any Holder for the payment of the Obligations may be
sold, exchanged, waived, surrendered or released. Neither the
Trustee nor any Holder shall have any obligation to protect,
secure, perfect or insure any other Lien at any time held by it
as security for the Obligations or any property subject thereto.
The Pledgor waives any and all notice of the creation, renewal,
extension or accrual of any of the Obligations and notice of or
proof of reliance by the Trustee or any Holder upon this
Agreement; the Obligations, and any of them, shall conclusively
be deemed to have been created, contracted or incurred in
reliance upon this Agreement; and all dealings between the
Company and the Pledgor, on the one hand, and the Trustee and the
Holders, on the other, shall likewise be conclusively presumed to
have been had or consummated in reliance upon this Agreement.
The Pledgor waives diligence, presentment, protest, demand for
payment and notice of default or nonpayment to or upon the Issuer
or the Pledgor with respect to the Obligations. When pursuing
its rights and remedies hereunder against the Pledgor, the
Trustee may, but shall be under no obligation to, pursue such
rights and remedies as it may have against the Company or any
other Person or against any collateral security or guarantee for
the Obligations or any right of offset with respect thereto, and
any failure by the Trustee to pursue such other rights or
remedies or to collect any payments from the Company or any such
other Person or to realize upon any such collateral security or
guarantee or to exercise any such right of offset, or any release
of the Company or any such other Person or of any such collateral
security, guarantee or right of offset, shall not relieve the
Pledgor of any liability hereunder, and shall not impair or
affect the rights and remedies, whether express, implied or
available as a matter of law, of the Trustee or any Holder
against the Pledgor or the Collateral.
11. Trustee's Appointment as Attorney-in-Fact. (a) The
Pledgor hereby irrevocably constitutes and appoints the Trustee
and any officer or agent of the Trustee, with full power of
substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of the
Pledgor and in the name of the Pledgor or in the Trustee's own
name, from time to time in the Trustee's discretion, for the
purpose of carrying out the terms of this Agreement, to take any
and all appropriate action and to execute any and all documents
and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, including, without limitation,
any financing statements, endorsements, assignments or other
instruments of transfer.
(b) The Pledgor hereby ratifies all that said attorneys
shall lawfully do or cause to be done pursuant to the power of
attorney granted in paragraph 0. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest
and are irrevocable until this Agreement is terminated and the
security interests created hereby are released.
12. Duty of Trustee. The Trustee's sole duty with respect
to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the Code or
otherwise, shall be to comply with the specific duties and
responsibilities set forth herein and in the Company Indenture.
The powers conferred on the Trustee in this Agreement are solely
for the protection of the Trustee's and the Holders' interests in
the Collateral and shall not impose any duty upon the Trustee or
any Holder to exercise any such powers. Neither the Trustee nor
any Holder nor its or their directors, officers, employees or
agents shall be liable for any action lawfully taken or omitted
to be taken by any of them under or in connection with the
Collateral or this Agreement, except for its or their gross
negligence or willful misconduct.
13. Execution of Financing Statements. Pursuant to Section
9-402 of the Code, the Pledgor authorizes the Trustee to file
financing statements with respect to the Collateral without the
signature of the Pledgor in such form and in such filing offices
as the Trustee reasonably determines appropriate to perfect the
security interests of the Trustee under this Agreement. A
carbon, photographic or other reproduction of this Agreement
shall be sufficient as a financing statement for filing in any
jurisdiction.
14. Authority of Trustee. The Pledgor acknowledges that
the rights and responsibilities of the Trustee under this
Agreement with respect to any action taken by the Trustee or the
exercise or non-exercise by the Trustee of any option, right,
request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the
Trustee and the Holders, be governed by the Company Indenture and
by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Trustee and the
Pledgor, the Trustee shall be conclusively presumed to be acting
as agent for the Holders with full and valid authority so to act
or refrain from acting, and the Pledgor shall not be under any
obligation, or entitlement, to make any inquiry respecting such
authority.
15. Indemnity of Trustee. The Pledgor shall indemnify the
Trustee, its officers, agents, employees and directors for, and
to hold each such person harmless against any and all losses,
liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties
under this Agreement, including the costs and expenses of
enforcing this Agreement against the Pledgor or any other Person
and investigating or defending itself against any claim (whether
asserted by the Pledgor or any Holder of Senior Secured Notes or
any other Person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be
attributable to its negligence or bad faith. The Trustee shall
notify the Pledgor promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Pledgor shall
not relieve the Pledgor of its obligations hereunder. The
Pledgor shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel and, if
Pledgor's counsel is not diligently prosecuting or defending the
matter, or in the event that there may be a conflict between the
positions of the Pledgor and Trustee in conducting the defense,
the Pledgor shall pay the reasonable fees and expenses of such
counsel. The Pledgor need not pay for any settlement made
without its consent, which consent shall not be unreasonably
withheld.
16. Notices. All notices, requests and demands to or upon
the Trustee or the Pledgor to be effective shall be in writing
(or by telex, fax or similar electronic transfer confirmed in
writing) and shall be deemed to have been duly given or made
(a) when delivered by hand or (b) if given by mail, when
deposited in the mails by certified mail, return receipt
requested, or (c) if by telex, fax or similar electronic
transfer, when sent and receipt has been confirmed, as follows:
(1) if to the Trustee, at its address or transmission
number for notices provided in the recitals of the Company
Indenture; and
(2) if to the Pledgor, at its address or transmission
number for notices set forth under its signature below.
The Trustee and the Pledgor may change their addresses and
transmission numbers for notices by notice in the manner provided
in this paragraph.
17. 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 without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
18. Integration. This Agreement represents the agreement
of the Pledgor with respect to the subject matter hereof and
there are no promises or representations by the Trustee or any
Holder relative to the subject matter hereof not reflected
herein.
19. Amendments in Writing; No Waiver; Cumulative Remedies.
(a) None of the terms or provisions of this Agreement may be
waived, amended, supplemented or otherwise modified except by a
written instrument executed by the Pledgor and the Trustee,
provided that any provision of this Agreement may be waived by
the Trustee in a letter or agreement executed by the Trustee or
by telex or facsimile transmission from the Trustee.
(b) Neither the Trustee nor any Holder shall by any act
(except by a written instrument pursuant to paragraph 0 hereof),
delay, indulgence, omission or otherwise be deemed to have waived
any right or remedy hereunder or to have acquiesced in any
Default or Event of Default or in any breach of any of the terms
and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Trustee, any right, power or
privilege hereunder shall operate as a waiver thereof. No single
or partial exercise of any right, power or privilege hereunder
shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. A waiver by the
Trustee of any right or remedy hereunder on any one occasion
shall not be construed as a bar to any right or remedy which the
Trustee would otherwise have on any future occasion.
(c) The rights and remedies herein provided are cumulative,
may be exercised singly or concurrently and are not exclusive of
any other rights or remedies provided by law.
20. Section Headings. The section headings used in this
Agreement are for convenience of reference only and are not to
affect the construction hereof or be taken into consideration in
the interpretation hereof.
21. Successors and Assigns. This Agreement shall be
binding upon the successors and assigns of the Pledgor and shall
inure to the benefit of the Trustee and the Holders and their
successors and assigns.
22. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
23. Submission To Jurisdiction; Waivers. The Pledgor
hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal
action or proceeding relating to this Agreement, or for
recognition and enforcement of any judgment in respect thereof,
to the non-exclusive general jurisdiction of the Courts of the
State of New York sitting in the Borough of Manhattan, the courts
of the United States of America for the Southern District of New
York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now
or hereafter have to the venue of any such action or proceeding
in any such court or that such action or proceeding was brought
in an inconvenient court and agrees not to plead or claim the
same;
(c) agrees that service of process in any such action
or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form
of mail), postage prepaid, to its address set forth below or at
such other address of which the Trustee shall have been notified
pursuant hereto;
(d) agrees that nothing herein shall affect the right
to effect service of process in any other manner permitted by law
or shall limit the right to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by
law, any right it may have to claim or recover in any legal
action or proceeding referred to in this paragraph any special,
exemplary, punitive or consequential damages.
24. WAIVERS OF JURY TRIAL. THE PLEDGOR AND, BY ITS
ACCEPTANCE HEREOF, THE TRUSTEE HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.
IN WITNESS WHEREOF, the Pledgor and the Trustee have caused
this Cash Collateral Agreement to be duly executed and delivered
as of the date first above written.
PANDA ENERGY CORPORATION
By:
Title:
Address:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
BANKERS TRUST COMPANY, as Trustee
By:
Title: