EXHIBIT 4.2
EXECUTION COPY
COLLATERAL TRUST AGREEMENT
dated as of December 12, 2002
among
The Grantors referred to herein
as Grantors
and
WILMINGTON TRUST COMPANY
as Corporate Trustee
and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
as Individual Trustee
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms............................................3
SECTION 1.02. Certain References...............................................9
ARTICLE II
CONFIRMATION AND CREATION OF SECURITY INTERESTS
SECTION 2.01. Collateral Trust Estate..........................................9
SECTION 2.02. Security for Secured Obligations................................10
ARTICLE III
COLLATERAL ACCOUNT
SECTION 3.01. Collateral Account..............................................10
ARTICLE IV
COLLATERAL TRUST AGREEMENT DEFAULTS; REMEDIES
SECTION 4.01. Collateral Trust Agreement Default Notice.......................11
SECTION 4.02. Direction by Required Representative(s).........................13
SECTION 4.03. Right to Initiate Judicial Proceedings, Etc.....................13
SECTION 4.04. Remedies Not Exclusive..........................................13
SECTION 4.05. Waiver of Certain Rights........................................14
SECTION 4.06. Limitation on Collateral Trustees' Duties in Respect
of Collateral...................................................14
SECTION 4.07. Limitation by Law...............................................14
SECTION 4.08. Absolute Rights of Secured Holders and Representatives..........15
ARTICLE V
APPLICATION OF PROCEEDS
SECTION 5.01. Application of Proceeds.........................................15
SECTION 5.02. Application of Withheld Amounts.................................18
SECTION 5.03. Release of Amounts in Collateral Account........................18
SECTION 5.04. Distribution Date...............................................18
ARTICLE VI
AGREEMENTS WITH THE COLLATERAL TRUSTEE
SECTION 6.01. Delivery of Agreements..........................................19
SECTION 6.02. Information as to Representatives...............................19
SECTION 6.03. Compensation and Expenses.......................................20
SECTION 6.04. Stamp and Other Similar Taxes...................................20
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SECTION 6.05. Filing Fees, Excise Taxes, Etc..................................20
SECTION 6.06. Indemnification.................................................20
SECTION 6.07. Further Assurances..............................................21
ARTICLE VII
THE COLLATERAL TRUSTEE
SECTION 7.01. Declaration of Trust............................................22
SECTION 7.02. Exculpatory Provisions..........................................22
SECTION 7.03. Delegation of Duties............................................23
SECTION 7.04. Reliance by Collateral Trustees.................................23
SECTION 7.05. Limitations on Duties of the Trustees...........................24
SECTION 7.06. Moneys to Be Held in Trust......................................25
SECTION 7.07. Resignation and Removal of Collateral Trustees..................25
SECTION 7.08. Status of Successors to Trustee.................................26
SECTION 7.09. Merger of the Corporate Trustee.................................26
SECTION 7.10. Powers of Individual Trustee....................................26
SECTION 7.11. Additional Co-Trustees; Separate Trustees.......................27
SECTION 7.12. Trustees Appointed Attorneys-in-Fact............................28
SECTION 7.13. Ordinary Care...................................................29
ARTICLE VIII
RELEASE OF COLLATERAL
SECTION 8.01. Partial Release of Collateral...................................29
SECTION 8.02. Full Release of Collateral Upon Satisfaction of Certain
Secured Obligations.............................................30
SECTION 8.03. Effect of Release of Collateral.................................31
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Supplements and Waivers.............................31
SECTION 9.02. Additional Actions of Representatives...........................32
SECTION 9.03. Notices.........................................................33
SECTION 9.04. Headings........................................................34
SECTION 9.05. Severability....................................................34
SECTION 9.06. Treatment of Payee or Indorsee by Trustees......................34
SECTION 9.07. Dealings with the Grantors......................................34
SECTION 9.08. Claims..........................................................34
SECTION 9.09. Binding Effect..................................................34
SECTION 9.10. Governing Law...................................................34
SECTION 9.11. Effectiveness...................................................35
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SECTION 9.12. Reexecution of Agreement........................................35
SECTION 9.13. Effect on Credit Agreements.....................................35
SECTION 9.14. Counterparts....................................................35
Schedule I - Fee Schedule
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COLLATERAL TRUST AGREEMENT
COLLATERAL TRUST AGREEMENT, dated December 12, 2002 (as amended, amended
and restated, supplemented or otherwise modified from time to time, this
"Agreement") by and among The AES Corporation, a Delaware corporation (the
"Borrower"), the other Persons listed on the signature pages hereof and the
Additional Grantors (the Borrower, the Persons so listed and the Additional
Grantors being, collectively, the "Grantors"), Wilmington Trust Company, a
Delaware banking corporation, not in its individual capacity but solely as
corporate trustee (together with any successor corporate trustee appointed
pursuant to Article VII, the "Corporate Trustee"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, an
individual residing in the State of Delaware, not in his individual capacity
but solely as individual trustee (together with any successor individual
trustee appointed pursuant to Article VII, the "Individual Trustee"; and,
together with the Corporate Trustee, the "Collateral Trustees"), the foregoing
trustees being trustees for the Secured Holders. Certain capitalized terms used
herein are defined in Article I of this Agreement. Terms defined in the Credit
Agreement and the Security Agreement and not otherwise defined in Article I of
this Agreement are used in this Agreement as defined in the Credit Agreement
and the Security Agreement.
PRELIMINARY STATEMENTS:
(1) The Borrower has entered into an Amended and Restated Credit,
Reimbursement and Exchange Agreement dated as of December 12, 2002 (said
Agreement, as it may hereafter be amended, amended and restated, supplemented
or otherwise modified from time to time, being the "Credit Agreement") with the
Subsidiary Guarantors party thereto, the Banks party thereto (the "Banks"), the
Revolving Fronting Banks and the Drax LOC Fronting Bank party thereto, and
Citicorp USA, Inc., as Administrative Agent for the Bank Parties (in such
capacity, the "Agent") and as Collateral Agent for the Bank Parties (in such
capacity, the "Credit Agreement Collateral Agent"; and together with the Agent,
the "Agents").
(2) In order to induce the Banks, the Revolving Fronting Banks, the Drax
LOC Fronting Banks and the Agents to enter into the Credit Agreement, the
Grantors have agreed to grant a continuing security interest in and to the
Collateral (as hereinafter defined) to the Collateral Trustees for the ratable
benefit of the Lender Parties to secure the Obligations of the Borrower under
the Credit Agreement and the Notes issued pursuant thereto.
(3) The Borrower will enter into an Indenture to be dated as of December
13, 2002 (as amended, supplemented or otherwise modified and in effect on the
date hereof and as the same may hereafter be further amended, modified,
extended, renewed, replaced, restated or supplemented from time to time
pursuant to the terms thereof, the "Exchange Note Indenture") with ▇▇▇▇▇ Fargo
Bank Minnesota, National Association (the "Exchange Note Trustee") to exchange
the Borrower's (i) 8.75% Senior Notes due 2002 and (ii) the 7.375% Remarketable
or Redeemable Securities due 2013 for the 10% Senior Secured Exchange Notes due
2005 to be issued on December 13, 2002 (the "Exchange Notes", and together with
the Exchange Note Indenture (only to the extent relating to the Exchange
Notes), the "Exchange Note Agreements").
(4) In order to induce the Exchange Note Trustee to enter into the
Exchange Note Indenture, the Grantors have agreed to grant a continuing
security interest in and to the
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Collateral to the Collateral Trustees for the ratable benefit of the Exchange
Note Holders to secure the Obligations of the Borrower under the Exchange Note
Agreements.
(5) The Borrower has entered into a Sponsor Agreement dated as of March 7,
2000 (as amended, supplemented or otherwise modified and in effect on the date
hereof and as the same may hereafter be further amended, modified, extended,
renewed, replaced, restated or supplemented from time to time pursuant to the
terms thereof, the "Sponsor Agreement") with BankBoston, N.A., Nassau Branch,
as agent (the "Sul Agent"), pursuant to which the Borrower has agreed to
guarantee the obligations of AES Cayman Guaiba, Ltd. under a Credit Agreement
dated as of March 6, 2001 (as amended, supplemented or otherwise modified and
in effect on the date hereof and as the same may hereafter be further amended,
modified, extended, renewed, replaced, restated or supplemented from time to
time pursuant to the terms thereof, the "Sul Credit Agreement") with
BankBoston, N.A., Nassau Branch, Banc of America Securities, LLC,
Unibanco-Uniao de Bancos Brasilieros S.A. and WestLB AG, New York Branch and
the lenders named therein (collectively, the "Sul Guaranteed Parties"), in an
amount of up to a maximum aggregate amount of $50,000,000 (together with any
other agreement or instrument delivered in connection with such guaranty, the
"Sul Guarantee").
(6) In order to satisfy certain conditions under the Sul Guarantee, the
Grantors have agreed to grant a continuing security interest in and to the
Collateral to the Collateral Trustees for the ratable benefit of the Sul
Guaranteed Parties to secure the Obligations of the Borrower under the Sul
Guarantee in an amount of up to a maximum aggregate amount of $50,000,000.
(7) The Borrower has entered into a Gas Transportation Agreement dated as
of July 21, 2000 with Florida Public Utilities Company pursuant to which Fleet
National Bank (the "Lake Worth LOC Bank") issued in favor of Florida Public
Utilities Company irrevocable standby letter of credit number 1S1280134
(together with the application and agreement therefor dated on or about July 6,
2001, the "Lake Worth Letter of Credit") in an aggregate amount not to exceed
$5,490,449.
(8) In order to satisfy certain conditions under the Lake Worth Letter of
Credit, the Grantors have agreed to grant a continuing security interest in and
to the Collateral to the Collateral Trustees for the ratable benefit of the
Lake Worth LOC Bank to secure the obligation of Lake Worth Generation LLC
("Lake Worth"), a Subsidiary of the Borrower, to reimburse the Lake Worth LOC
Bank for any drawings under the Lake Worth Letter of Credit in an amount of up
to a maximum aggregate amount of $5,490,449.
(9) This Agreement and the other Shared Collateral Documents are intended
to secure the other Secured Agreements and the Collateral Trustees have agreed
to undertake the rights, powers, duties and responsibilities set forth in this
Agreement and the other Shared Collateral Documents in order to effect such
purpose.
NOW, THEREFORE, in consideration of the premises and in order to (1)
induce (a) the Banks to continue the Loans and the Revolving Credit Loan Banks
to make Revolving Credit Loans, (b) the Revolving Fronting Banks to issue (or
be deemed to have issued) Revolving Letters of Credit, (c) the Drax LOC
Fronting Bank to be deemed to have issued the
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Drax Letter of Credit and to make Drax Loans in respect of Drax L/C Drawings,
(d) the Hedge Banks to enter into Secured Hedge Agreements from time to time,
(e) the entry into the Secured Treasury Management Service Agreements by a Bank
Party or an Affiliate thereof and (f) the Exchange Note Trustee to enter into
the Exchange Note Indenture and (2) satisfy certain conditions under the Sul
Guarantee and the Lake Worth Letter of Credit, each Grantor hereby agrees with
the Collateral Trustees for their benefit and in trust for the ratable benefit
of the Representatives and the Secured Holders (as each term is hereinafter
defined) as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. The following terms shall have the
following meanings as used herein (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"Additional Collateral Trust Agreement Collateral" has the meaning
specified in Section 2.01.
"Applicable Agreement" means the Credit Agreement Documents, the Shared
Collateral Documents, the Exchange Note Agreements, the Sul Guarantee, the Lake
Worth Letter of Credit and the Other Debt Agreements.
"Authorized Officer" means the Chairman, the President, the Chief
Executive Officer, the Chief Financial Officer, the Comptroller, any Vice
President, the Secretary, Assistant Secretary, Treasurer or the Assistant
Treasurer of a Person or any other officer designated as an "Authorized
Officer" by the Board of Directors (or equivalent governing body) of such
Person.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time.
"Banks" has the meaning specified in the Preliminary Statements to this
Agreement.
"Borrower" has the meaning specified in the recital of parties to this
Agreement.
"Business Day" means a day of the year on which banks are not required or
authorized by law to close in New York City or the city in which the Corporate
Trustee maintains its corporate trust office.
"BVI Cayman Pledge Agreement" means the Charge and Assignment of Shares
(as such agreement may hereafter be amended, amended and restated, supplemented
or otherwise modified from time to time) dated December 12, 2002 between AES
International Holdings II, Ltd. and the Collateral Trustees.
"Cash Equivalents" means any of the following, to the extent owned by the
Borrower or any of its Subsidiaries free and clear of all Liens other than
Liens created under the
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Shared Collateral Documents and having a maturity of not greater than 360 days
from the date of issuance thereof: (a) readily marketable direct obligations of
the Government of the United States or any agency or instrumentality thereof or
obligations unconditionally guaranteed by the full faith and credit of the
Government of the United States, (b) insured certificates of deposit of or time
deposits with any commercial bank that is a Lender Party or a member of the
Federal Reserve System, issues (or the parent of which issues) commercial paper
rated as described in clause (c) below, is organized under the laws of the
United States or any State thereof and has combined capital and surplus of at
least $1 billion or (c) commercial paper in an aggregate amount of no more than
$5,000,000 per issuer outstanding at any time, issued by any corporation
organized under the laws of any State of the United States and rated at least
"Prime-1" (or the then equivalent grade) by ▇▇▇▇▇'▇ Investors Service, Inc. or
"A-1" (or the then equivalent grade) by Standard & Poor's, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. The term "Cash Equivalents" shall include any
mutual fund sponsored or managed by an Affiliate of the Corporate Trustee which
mutual fund's assets consist of "Cash Equivalents" as defined herein.
"Collateral" means the Creditor Group Collateral, as such term is defined
in the Credit Agreement.
"Collateral Account" has the meaning specified in Section 3.01.
"Collateral Trustees" has the meaning specified in the recital of parties
to this Agreement.
"Collateral Trustees' Fees" means the fees and other amounts payable to
the Collateral Trustees pursuant to Sections 6.03, 6.04 and 6.05 and amounts
claimed and unpaid pursuant to Section 6.06.
"Collateral Trust Agreement Default" means (i) so long as any Secured
Obligation remains outstanding with respect to any Lender Party under the
Credit Agreement or any Revolving Credit Loan Bank has a Revolving Credit Loan
Commitment or any Revolving Letter of Credit or Drax Letter of Credit remains
outstanding, (A) in respect of the exercise of remedies with respect to the
Account Collateral, the Additional Collateral Trust Agreement Collateral and
the Securities Accounts (and all Collateral from time to time credited to the
Deposit Accounts and the Securities Accounts) or the exercise of remedies under
Section 15 of the Security Agreement or Section 11 of the BVI Cayman Pledge
Agreement, an Event of Default described in clauses (a), (e), (f), (g) and (h)
of Section 6.01 of the Credit Agreement and (B) in respect of any other
exercise of rights and remedies under the Shared Collateral Documents, any
Event of Default, in each case, shall have occurred and be continuing under the
Credit Agreement, and as a result thereof, the Credit Agreement Defaulted Party
has the right to declare all of the Secured Obligations of the Loan Parties
under the Credit Agreement to be due and payable prior to the stated maturity
thereof and (ii) at any time that no Secured Obligations remain outstanding
with respect to any Lender Party under the Credit Agreement and no Revolving
Credit Loan Bank has a Revolving Credit Loan Commitment and no Revolving Letter
of Credit or Drax Letter of Credit remains outstanding, (A) in respect of the
exercise of remedies with respect to the Account Collateral, the Additional
Collateral Trust Agreement Collateral and the Securities Accounts (and all
Collateral from time to time credited to the Deposit Accounts and the
Securities Accounts) or the exercise of remedies under Section 15 of the
Security
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Agreement or Section 11 of the BVI Cayman Pledge Agreement, events of default
under the Exchange Note Agreements, the Sul Credit Agreement, the Lake Worth
Letter of Credit or any of the Other Debt Agreements of the type described in
clauses (a), (e), (f), (g) and (h) of Section 6.01 of the Credit Agreement and
(B) in respect of any other exercise of rights and remedies under the Shared
Collateral Documents, any event of default, in each case, shall have occurred
and be continuing under the Exchange Note Agreements, the Sul Credit Agreement,
the Lake Worth Letter of Credit or any of the Other Debt Agreements, and as a
result thereof, the Other Debt Defaulted Party has the right to declare all of
the Secured Obligations of the Borrower under the Exchange Note Agreements, the
Sul Credit Agreement, the Lake Worth Letter of Credit or the Other Debt
Agreements to be due and payable prior to the stated maturity thereof.
"Collateral Trust Agreement Default Notice" means a written notice
delivered in connection with a Collateral Trust Agreement Default.
"Collateral Trust Estate" means all of the right, title and interest of
the Collateral Trustees, whether now owned or hereafter acquired, in and to the
Collateral.
"Corporate Trustee" has the meaning specified in the recital of parties to
this Agreement.
"Credit Agreement" has the meaning specified in the Preliminary
Statements.
"Credit Agreement Collateral Agent" has the meaning specified in the
Preliminary Statements to this Agreement.
"Credit Agreement Defaulted Party" means the Agent or the percentage of
the Banks specified in the Credit Agreement that have the right thereunder upon
the occurrence and continuance of an Event of Default under the Credit
Agreement (without the requirement that any further time elapse) to declare all
of the Secured Obligations of the Loan Parties under the Credit Agreement to be
due and payable prior to the stated maturity thereof.
"Credit Agreement Documents" means (i) the Credit Agreement, (ii) the
Notes, (iii) the Secured Hedge Agreements and (iv) the Secured Treasury
Management Service Agreements, in each case as amended from time to time.
"Defaulted Agreement Party" means the Credit Agreement Defaulted Party or
the Other Debt Defaulted Party, as applicable.
"Distribution Date" means any date on which the Collateral Trustees shall
distribute moneys from the Collateral Account pursuant to Section 5.01.
"Exchange Note Agreements" has the meaning specified in the Preliminary
Statements to this Agreement.
"Exchange Note Holders" means at any time the registered holders of the
Exchange Notes issued under the Exchange Note Indenture.
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"Exchange Note Indenture" has the meaning specified in the Preliminary
Statements to this Agreement.
"Exchange Notes" has the meaning specified in the Preliminary Statements
to this Agreement.
"Exchange Note Trustee" has the meaning specified in the Preliminary
Statements to this Agreement.
"Grantors" has the meaning specified in the recitals of parties to this
Agreement.
"Indemnified Event" has the meaning specified in the Section 7.05(e) of
this Agreement.
"Individual Trustee" has the meaning specified in the recital of parties
to this Agreement.
"Lake Worth" has the meaning specified in the Preliminary Statements to
this Agreement.
"Lake Worth Letter of Credit" has the meaning specified in the Preliminary
Statements to this Agreement.
"Lake Worth LOC Bank" has the meaning specified in the Preliminary
Statements to this Agreement.
"Lender Parties" means the Agent, the Banks, the Revolving Fronting Banks,
the Drax LOC Fronting Banks, the Hedge Banks and the Credit Agreement
Collateral Agent.
"Moody's" means Moody's Investor's Service, Inc.
"Payment Information" has the meaning specified in Section 6.02(a) of this
Agreement.
"Other Debt" means Debt issued pursuant to any Other Debt Agreement.
"Other Debt Agreement" means any other agreement or instrument pursuant to
which the Borrower has incurred Debt permitted by Sections 5.07(a)(iii);
5.07(a)(x) and 5.07(a)(xi) of the Credit Agreement.
"Other Debt Defaulted Party" means the Other Debt Representatives, acting
collectively on behalf of the Required Other Debt Holders.
"Other Debt Holders" means at any time the registered holders of Other
Debt issued under any Other Debt Agreement.
"Other Debt Representatives" means the representatives of the Required
Other Debt Holders, and may include, as the case may be, the Exchange Note
Trustee, the Sul Agent,
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the Lake Worth LOC Bank or the representative of the Other Debt Holders under
any Other Debt Agreement.
"Remedies Limitations" has the meaning set forth in Section 7(i) of the
Security Agreement.
"Representatives" means at any time, collectively, (a) the Agent, as the
representative hereunder for the Lender Parties at such time, (b) the Exchange
Note Trustee, as the representative hereunder for the Exchange Note Holders,
(c) the Sul Agent, as the representative hereunder for the Sul Guaranteed
Parties, (d) the Lake Worth LOC Bank on behalf of itself and (e) the
representatives hereunder for the Other Debt Holders at such time.
"Required Exchange Note Holder Approval" means the Collateral Trustees
shall have received a certificate from the Exchange Note Trustee that it has
received the consent of those Exchange Note Holders holding a majority of the
principal outstanding amount of the Exchange Notes for such amendment, waiver
or consent.
"Required Other Debt Holders" means Secured Holders that own or hold
(either by themselves or through their respective Secured Holders) more than
50% of the aggregate amount of the outstanding Debt under the Exchange Note
Agreements, the Sul Guarantee, the Lake Worth Letter of Credit and the Other
Debt Agreements at any given time.
"Required Representative(s)" means (a) at any time that no Collateral
Trust Agreement Default has occurred or is continuing and any Secured
Obligations remain outstanding with respect to any Lender Party under the
Credit Agreement or any Revolving Credit Loan Bank has a Revolving Credit Loan
Commitment or any Revolving Letter of Credit or Drax Letter of Credit remains
outstanding, the Agent acting in its own discretion or at the direction of the
Required Banks at such time, (b) at any time that no Collateral Trust Agreement
Default has occurred or is continuing, and no Secured Obligations remain
outstanding with respect to any Lender Party under the Credit Agreement and no
Revolving Credit Loan Bank has a Revolving Credit Loan Commitment and no
Revolving Letter of Credit or Drax Letter of Credit remains outstanding, the
Other Debt Representatives acting at the direction of the Required Other Debt
Holders, (c) at any time that a Collateral Trust Agreement Default has occurred
and is continuing and any Secured Obligations remain outstanding with respect
to any Lender Party under any Credit Agreement or any Revolving Credit Loan
Bank has a Revolving Credit Loan Commitment or any Revolving Letter of Credit
or Drax Letter of Credit remains outstanding, the Agent, on behalf of itself
and the Required Banks or (d) at any time that a Collateral Trust Agreement
Default has occurred and is continuing and no Secured Obligations remain
outstanding with respect to any Lender Party under the Credit Agreement and no
Revolving Credit Loan Bank has a Revolving Credit Loan Commitment and no
Revolving Letter of Credit or Drax Letter of Credit remains outstanding, the
Other Debt Representatives, on behalf of the Required Other Debt Holders;
provided, however, that amounts held at such time by the Collateral Trustees on
behalf of a Representative and such Representative's Secured Holders in an
account of the Corporate Trustee established at the request of such
Representative pursuant to Section 5.02 hereof shall be deemed to have been
applied to repay the Secured Obligations of such Secured Holders whether or not
such amount has been so applied. Unless and until the Collateral Trustees shall
have received a notice from the Agent to the effect that at no Secured
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Obligations remain outstanding with respect to any Lender Party under the
Credit Agreement and no Revolving Credit Loan Bank has a Revolving Credit Loan
Commitment and no Revolving Letter of Credit or Drax Letter of Credit remains
outstanding, the Collateral Trustees may assume that the Agent is the Required
Representative. After receipt of such notice, the Collateral Trustees may
assume that the Other Debt Representatives are the Required Representative(s).
"Secured Agreements" means, collectively, the Credit Agreement Documents,
the Exchange Note Agreements, the Sul Guarantee, the Lake Worth Letter of
Credit, the Other Debt Agreements and each agreement or instrument delivered by
the Grantors pursuant thereto (including, without limitation, the Shared
Collateral Documents).
"Secured Holders" means, at any time, the Lender Parties, the Exchange
Note Holders, the Sul Guaranteed Parties, the Lake Worth LOC Bank and Other
Debt Holders.
"Secured Obligations" means at any time any obligations, whether matured
or unmatured, contingent or liquidated, of each Grantor arising out of or
evidenced by the Secured Agreements, whether for principal, interest, expenses,
premiums, indemnities, fees or other amounts, whether or not such obligations
are due and payable at such time; provided, however, that (i) Obligations under
the Secured Hedge Agreements, excluding the Banc of America Secured Option,
shall only be secured up to an amount not to exceed $50,000,000 in the
aggregate, (ii) Obligations under the Sul Guarantee shall only be secured up to
an amount not to exceed $50,000,000 and (iii) Obligations under the Lake Worth
Letter of Credit shall only be secured up to an amount not to exceed
$5,490,449.
"Shared Collateral Documents" means this Agreement, the Security
Agreement, the BVI Cayman Pledge Agreement and each Successor Collateral
Agreement.
"S&P" means Standard & Poors, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.
"Successor Collateral" means, with respect to each Grantor, any property
and assets of such Grantor (or any of its successors and assigns) as such
Grantor (or any such successor or any such assign) may, from time to time, upon
notice to the Collateral Trustees, pursuant to the Credit Agreement Documents,
the Exchange Note Agreements, the Sul Guarantee, the Lake Worth Letter of
Credit and the Other Debt Agreements or otherwise, grant to the Collateral
Trustees as additional collateral for their benefit and in trust for the equal
and ratable benefit of the Representatives, on their behalf and on behalf of
the Secured Holders.
"Successor Collateral Agreements" means all documents creating, evidencing
or relating to any of the Successor Collateral.
"Sul Agent" has the meaning specified in the Preliminary Statements to
this Agreement.
"Sul Credit Agreement" has the meaning specified in the Preliminary
Statements to this Agreement.
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"Sul Guarantee" has the meaning specified in the Preliminary Statements to
this Agreement.
"Sul Guaranteed Parties" has the meaning specified in the Preliminary
Statements to this Agreement.
SECTION 1.02. Certain References. In this Agreement, the words "hereof,"
"herein" and "hereunder", and words of similar import, shall refer to this
Agreement as a whole and not to any particular provision of this Agreement. All
section, schedule and exhibit references set forth in this Agreement are,
unless otherwise specified, references to such section in, or schedule or
exhibit to, this Agreement.
ARTICLE II
CONFIRMATION AND CREATION OF SECURITY INTERESTS
SECTION 2.01. Collateral Trust Estate. Each Grantor hereby confirms that,
pursuant to the terms of the Security Agreement and the BVI Cayman Pledge
Agreement, such Grantor has pledged and assigned to the Collateral Trustees for
their benefit and in trust for the equal and ratable benefit of the
Representatives and the Secured Holders, and has granted the Collateral
Trustees for their benefit and in trust for the equal and ratable benefit of
the Representatives and the Secured Holders, a lien on, and security interest
in, the Collateral described therein of such Grantor in order to secure the
Secured Obligations. The Borrower, in order to secure the Secured Obligations,
hereby further pledges and assigns to the Collateral Trustees for their benefit
and in trust for the equal and ratable benefit of the Representatives, on their
behalf and on behalf of the Secured Holders, and hereby grants to the
Collateral Trustees for their benefit and in trust for the equal and ratable
benefit of the Representatives, on their behalf and on behalf of the Secured
Holders, a lien on, and security interest in, the following (collectively,
together with any Successor Collateral, the "Additional Collateral Trust
Agreement Collateral"):
(i) the Collateral Account established pursuant to Section 3.01(a)
with the Corporate Trustee at its offices at its corporate trust
department in the State of Delaware and is, and shall at all times remain,
under the sole dominion and control of the Corporate Trustee, all funds
held therein and all certificates and instruments, if any, from time to
time representing each Collateral Account;
(ii) all Cash Equivalents held in the Collateral Account from time to
time and all certificates and instruments, if any, from time to time
representing or evidencing such Cash Equivalents;
(iii) all notes, certificates of deposit, deposit accounts, checks
and other instruments from time to time delivered to or otherwise
possessed by the Collateral Trustees for or on behalf of the Borrower in
substitution for or in addition to any or all of the then existing
Additional Collateral Trust Agreement Collateral;
(iv) all interest, income, dividends, instruments and other property
and assets from time to time received, receivable or otherwise distributed
in respect of or in
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exchange for any or all of the then existing Additional Collateral Trust
Agreement Collateral referred to in clauses (i) through (iii) of this
Section 2.01(a); and
(v) all proceeds of any and all of the foregoing Additional
Collateral Trust Agreement Collateral (including, without limitation,
proceeds that constitute property and assets of the types described in
clauses (i) through (iv) of this Section 2.01(a)) and, to the extent not
otherwise included, all (A) payments under any indemnity, warranty or
guaranty payable with respect to any of the foregoing Additional
Collateral Trust Agreement Collateral and (B) cash.
SECTION 2.02. Security for Secured Obligations. All of the right, title
and interest of the Collateral Trustees in and to the Collateral Trust Estate
secures the payment of all of the Secured Obligations now or hereafter existing
under or in respect of the Secured Agreements and the performance of, and the
compliance with, all of the covenants and conditions of this Agreement, the
other Shared Collateral Documents and the other Secured Agreements. Without
limiting the generality of the foregoing, the Collateral Trust Estate secures
the payment of all amounts that constitute part of the Secured Obligations and
would be owed by each Grantor to the Collateral Trustees, any Representative or
any Secured Holder under the Shared Collateral Documents or the other Secured
Agreements but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
such Grantor.
ARTICLE III
COLLATERAL ACCOUNT
SECTION 3.01. Collateral Account. (a) Until the date that the Collateral
Trustees release all of the Collateral pursuant to Section 8.02(a), a
non-interest bearing cash collateral account (the "Collateral Account") for the
Representatives and the Secured Holders shall be maintained by the Corporate
Trustee at its offices at its corporate trust department in the State of
Delaware in accordance with the terms of this Agreement. All moneys that are
received by the Collateral Trustees, upon the occurrence and during the
continuance of a Collateral Trust Agreement Default, or upon liquidation or
otherwise in respect of the Collateral shall be deposited in the Collateral
Account and, thereafter, shall be held and applied by the Corporate Trustee all
in accordance with the terms of this Agreement.
(b) The Corporate Trustee shall, subject to the provisions of Article IV
and Article VIII, from time to time (i) invest amounts on deposit in the
Collateral Account in Cash Equivalents and (ii) invest interest paid on such
Cash Equivalents, and reinvest other proceeds of any such Cash Equivalents that
may mature or be sold, in additional Cash Equivalents, in each case at the
direction of the Grantors so long as no Collateral Trust Agreement Default
shall have occurred and be continuing and at the direction of the Required
Representative(s) if a Collateral Trust Agreement Default shall have occurred
and be continuing. Interest and proceeds that are not invested or reinvested in
Cash Equivalents as provided in the immediately preceding sentence shall be
deposited and held in the Collateral Account. Notwithstanding the foregoing,
the Corporate Trustee shall, to the extent possible, invest any funds to be
distributed on a Distribution Date in Cash Equivalents that shall mature or
become liquid on or prior to such
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Distribution Date. All Cash Equivalents made in respect of the Collateral
Account and all interest and income received thereon and therefrom and the net
proceeds realized on the maturity or sale thereof shall be held in the
Collateral Account as part of the Collateral Trust Estate pursuant to the terms
hereof.
(c) The Collateral Account shall be subject to such applicable laws, and
such applicable regulations of the Board of Governors of the Federal Reserve
System and of any other appropriate banking or regulatory authority, as are in
effect from time to time.
(d) All dividends, interest and other distributions deposited into the
Collateral Account pursuant to Section 10(b) of this Agreement or Section 6.2
of the BVI Cayman Pledge Agreement shall be released and returned to the
applicable Grantor upon notice to the Collateral Trustees from the Required
Representative(s) that the Collateral Trust Agreement Default giving rise to
such deposit has been cured or waived; provided, that no Collateral Trust
Agreement Default shall have occurred and be continuing at such time.
ARTICLE IV
COLLATERAL TRUST AGREEMENT DEFAULTS; REMEDIES
SECTION 4.01. Collateral Trust Agreement Default Notice. (a) (x) So long
as any Secured Obligations remain outstanding with respect to any Lender Party
under the Credit Agreement or any Revolving Credit Loan Bank has a Revolving
Credit Loan Commitment or any Revolving Letter of Credit or Drax Letter of
Credit remains outstanding, the Credit Agreement Defaulted Party shall have the
exclusive right if a Collateral Trust Agreement Default under the Credit
Agreement shall have occurred and be continuing to give the Collateral Trustees
a Collateral Trust Agreement Default Notice and (y) at any time that no Secured
Obligations remain outstanding with respect to any Lender Party under the
Credit Agreement and no Revolving Credit Loan Bank has a Revolving Credit Loan
Commitment and no Revolving Letter of Credit or Drax Letter of Credit remains
outstanding, the Other Debt Defaulted Party shall have the exclusive right if a
Collateral Trust Agreement Default shall have occurred and be continuing under
the Other Debt Agreements, to give the Collateral Trustees a Collateral Trust
Agreement Default Notice, and if a Credit Agreement Defaulted Party or an Other
Debt Defaulted Party, as the case may be, gives the Collateral Trustees, with a
copy to the Grantors, a Collateral Trust Agreement Default Notice, stating:
(i) the nature of the Collateral Trust Agreement Default; and
(ii) the action requested to be taken by the Collateral Trustees with
respect to the Collateral and the Shared Collateral Documents (which
action may include, without limitation, the institution of any remedies
provided by law or this Agreement or any other Shared Collateral
Document),
then the Collateral Trustees shall forthwith send a copy of the Collateral
Trust Agreement Default Notice to each Representative. The Required
Representative(s) shall provide the Collateral Trustees with a certificate that
shall state whether or not they favor the Collateral Trustees taking such
action. If the Required Representative(s) shall not have provided the
Collateral Trustees with such certificate within 30 Business Days of receipt of
the copy of the
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Collateral Trust Agreement Default Notice, the Required Representative(s) shall
be deemed to have not favored the taking of such action. If the Required
Representative(s) shall have directed the Collateral Trustees to commence the
action set forth in the Collateral Trust Agreement Default Notice then, subject
to Section 4.01(b) and the right of the Collateral Trustees to commence such
action under the Shared Collateral Documents, the Collateral Trustees shall
forthwith undertake such action. The Collateral Trustees shall, subject to
Sections 4.01(b), 4.08 and 6.06, follow the directions of the Required
Representative(s) with respect to the time, method and place of taking any
action requested in a Collateral Trust Agreement Default Notice. Each
Collateral Trustee shall be entitled to assume conclusively that no Collateral
Trust Agreement Default has occurred and is continuing until it receives a
Collateral Trust Agreement Default Notice. For the avoidance of doubt, unless
and until the Collateral Trustees shall have received a notice from the Agent
to the effect that no Secured Obligations remain outstanding with respect to
any Lender Party under the Credit Agreement and no Revolving Credit Loan Bank
has a Revolving Credit Loan Commitment and no Revolving Letter of Credit or
Drax Letter of Credit remains outstanding, the Collateral Trustees may presume
that the Credit Agreement Defaulted Party has the exclusive right to deliver a
Collateral Trust Agreement Default Notice. After receipt of such notice, the
Collateral Trustees may presume that the Other Debt Defaulted Party has the
exclusive right to deliver a Collateral Trust Agreement Default Notice.
(b) If the Collateral Trust Agreement Default, which was the basis for the
giving of a Collateral Trust Agreement Default Notice, shall be cured or waived
in accordance with the terms of the applicable Secured Agreement, the Defaulted
Agreement Party which gave such Collateral Trust Agreement Default Notice shall
promptly notify the Collateral Trustees in writing of such cure or waiver, upon
receipt of such written notice of a cure or waiver (i) such Collateral Trust
Agreement Default Notice shall be deemed withdrawn and (ii) any direction to
the Collateral Trustees to take any action in connection with such Collateral
Trust Agreement Default Notice shall be deemed immediately rescinded. If in
connection solely with such withdrawn Collateral Trust Agreement Default Notice
the Collateral Trustees shall have been directed to take, and shall have
commenced taking but shall not have completed, any action, the Collateral
Trustees shall promptly terminate any such action which they shall not also
have been directed to take in connection with a Collateral Trust Agreement
Default Notice other than that withdrawn.
(c) Anything contained herein or under any Shared Collateral Agreement to
the contrary notwithstanding, upon the occurrence and continuance of a
Collateral Trust Agreement Default under the Credit Agreement, the Collateral
Trustees shall forebear from exercising any of their rights and remedies
hereunder or under any Shared Collateral Document with respect to the Equity
Interests of AES EDC Funding II L.L.C. pledged as Collateral under the Security
Agreement until the date that occurs 45 days following the date of delivery of
a Collateral Trust Agreement Default Notice by a Credit Agreement Defaulted
Party; provided that such date shall be extended so long as the collateral
agent under the Tranche C Pledge Agreement is actively pursuing its rights and
remedies with respect to the Tranche C Collateral under the Tranche C Pledge
Agreement and the Collateral Trustees have received evidence satisfactory to
them of such pursuit; provided, however, that nothing in this Section 4.01(c)
shall prevent the Collateral Trustees from immediately exercising their rights
and remedies with
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respect to all other Collateral as provided for in this Agreement and the other
Shared Collateral Documents.
SECTION 4.02. Direction by Required Representative(s). As to any matters
not expressly provided for under this Agreement or the other Shared Collateral
Documents (including, without limitation, matters relating to enforcement and
collection of the Secured Obligations), the Collateral Trustees shall not be
required to exercise any discretion or to take any action under this Agreement
or the other Shared Collateral Documents, or in respect of the Collateral, but
shall be required to act or to refrain from acting (and shall be fully
protected in acting or refraining from acting) in accordance with the written
instructions of the Required Representative(s) which instructions shall
reference Section 6.06 hereof.
SECTION 4.03. Right to Initiate Judicial Proceedings, Etc. (a)
Notwithstanding any other provision of this Agreement, upon the occurrence of
and during the continuance of any Collateral Trust Agreement Default and the
receipt by the Collateral Trustees of a Collateral Trust Agreement Default
Notice that has not been withdrawn pursuant to Section 4.01(b) above, the
Corporate Trustee, and if the Corporate Trustee deems necessary or desirable,
the Individual Trustee, jointly or individually as the Corporate Trustee may
determine, (i) shall have the right and power to institute and maintain such
suits and proceedings as it or they, as the case may be, or the Required
Representative(s) may deem appropriate to protect and enforce the rights vested
in it by this Agreement and the other Shared Collateral Documents and (ii) may
either, after entry or without entry, proceed by suit or suits at law or in
equity to enforce such rights and to foreclose upon the Collateral and to
dispose of, collect or otherwise realize upon, all or any portion of the
Collateral Trust Estate under the judgment or decree of a court of competent
jurisdiction.
(b) If a receiver of the Collateral Trust Estate shall be appointed in
judicial proceedings, the Collateral Trustees may be appointed, at its
discretion, as such receiver. Notwithstanding the appointment of a receiver,
the Collateral Trustees shall be entitled to retain possession and control of
all cash held by or deposited with them or their agents or co-trustees pursuant
to any provision of this Agreement or any other Shared Collateral Document.
SECTION 4.04. Remedies Not Exclusive. (a) No remedy conferred upon or
reserved to the Collateral Trustees herein or in the other Shared Collateral
Documents is intended to be a limitation exclusive of any other remedy or
remedies, but every such remedy shall be cumulative and shall be in addition to
every other remedy conferred herein or in the other Shared Collateral Documents
or now or hereafter existing at law or in equity or by statute.
(b) No delay or omission of either of the Collateral Trustees to exercise
any right, remedy or power accruing upon any Collateral Trust Agreement Default
shall impair any such right, remedy or power or shall be construed to be a
waiver of any such Collateral Trust Agreement Default or any acquiescence
therein; and every right, power and remedy given by this Agreement or any other
Shared Collateral Document to the Collateral Trustees may be exercised from
time to time and as often as may be deemed expedient by the Collateral
Trustees.
(c) In case either of the Collateral Trustees shall have proceeded to
enforce any right, remedy or power under this Agreement or any other Shared
Collateral Document and
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the proceeding for the enforcement thereof shall have been discontinued or
abandoned for any reason or shall have been determined adversely to such
Collateral Trustee, then and in every such case the Grantors, the Collateral
Trustees, the Representatives and Secured Holders shall, subject to any
determination in such proceeding, severally be restored to their former
positions and rights hereunder and under such other Shared Collateral Document
with respect to the Collateral Trust Estate, the Collateral Account and in all
other respects, and thereafter all rights, remedies and powers of such
Collateral Trustee shall continue as though no such proceeding had been taken.
(d) Each Grantor expressly agrees that all rights of action and rights to
assert claims upon or under this Agreement and the other Shared Collateral
Documents may be enforced by the Collateral Trustees without the possession of
any debt instrument or the production thereof in any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Collateral
Trustees shall be brought in either of their names as Collateral Trustee and
any recovery of judgment shall be held as part of the Collateral Trust Estate;
provided that nothing in this Section 4.04(d) shall constitute a waiver of any
right that the Grantors may have or may hereafter acquire to challenge the
amounts outstanding under the Secured Agreements.
SECTION 4.05. Waiver of Certain Rights. Subject to the Remedies
Limitations, each Grantor, on behalf of itself and all who may claim through or
under it, including, without limitation, any and all subsequent Affiliates,
creditors, vendees, assignees and lienors, expressly waives and releases, to
the fullest extent permitted by law, any, every and all rights to demand or to
have any marshalling of the Collateral Trust Estate upon any enforcement of any
Shared Collateral Document, including, without limitation, upon any sale,
whether made under any power of sale herein granted or pursuant to judicial
proceedings or upon any foreclosure or any enforcement of any Shared Collateral
Document and consents and agrees that all the Collateral Trust Estate and any
such sale may be offered and sold as an entirety.
SECTION 4.06. Limitation on Collateral Trustees' Duties in Respect of
Collateral. Beyond the duties set forth in this Agreement, the Collateral
Trustees shall not have any duty to the Grantors or the Representatives as to
any Collateral in the Collateral Trustees' possession or control or in the
possession or control of any agent or nominee of the Collateral Trustees or any
income thereon or as to the preservation of rights against prior parties or any
other rights pertaining thereto, except that each Collateral Trustee shall be
liable for its failure to exercise ordinary care in the handling of moneys and
securities and other property actually received by it.
SECTION 4.07. Limitation by Law. All rights, remedies and powers provided
by this Article IV may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law, and all the
provisions of this Article IV are intended to be subject to all applicable
mandatory provisions of law which may be controlling and to be limited to the
extent necessary so that they will not render this Agreement invalid,
unenforceable in whole or in part or, if the Representatives elect that this
Agreement should be recorded, registered or filed, not entitled to be recorded,
registered, or filed under the provisions of any applicable law.
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SECTION 4.08. Absolute Rights of Secured Holders and Representatives.
Notwithstanding any other provision of this Agreement or any of the other
Shared Collateral Documents, each of the Representatives and each of the
Secured Holders has an absolute and unconditional right to receive payment of
all of the Secured Obligations owing to such Representative or such Secured
Holder, as the case may be, when the same becomes due and payable and at the
time and place and otherwise in the manner set forth in the applicable Secured
Agreement, and the right of each such Representative and each such Secured
Holder to institute proceedings for the enforcement of such payment on or after
the date such payment becomes due and to assert its position as a secured
creditor in a proceeding under the Bankruptcy Code in which any Grantor is a
debtor, and the obligation of such Grantor to pay all of the Secured
Obligations owing to each of the Representatives and each of the Secured
Holders at the time and place expressed therein, shall not be impaired or
affected without the consent of such Representative or such Secured Holder. In
addition, the right of any Secured Holder or any Representative, on behalf of
itself or on behalf of any such Secured Holder, to receive payment or security
from sources other than the Collateral shall not be, and is not hereby,
impaired or affected in any manner. Without limiting the generality of the
foregoing provisions of this Section 4.08, no Representative and no Secured
Holder, on behalf of itself or on behalf of any Secured Holder, shall be
obligated to share with any other Representative or any other Secured Holder
any proceeds of any collateral, guaranty or right of setoff other than pursuant
to, and to the extent expressly required under, this Agreement and the other
Secured Agreements; nor shall any Representative's or any Secured Holder's
right to receive its ratable share of any amounts maintained in the Collateral
Account, if any, or any proceeds of any of the Collateral, or any part thereof,
under the terms of this Agreement and the other Shared Collateral Documents be
diminished or affected in any way by its right to receive proceeds of any other
collateral or right of setoff, or payment upon a guaranty or from any other
source.
ARTICLE V
APPLICATION OF PROCEEDS
SECTION 5.01. Application of Proceeds. (a) If, pursuant to the exercise by
the Defaulted Agreement Party of any rights and remedies set forth in any
Shared Collateral Document, any Collateral is sold or otherwise realized upon
by the Collateral Trustees, the proceeds received by the Collateral Trustees in
respect of such Collateral shall be deposited in the Collateral Account, and
all moneys held by the Corporate Trustee in the Collateral Account, including
the Excess Revolving Letter of Credit Collateral and the Excess Drax LOC
Collateral, shall, to the extent available for distribution, be distributed by
the Corporate Trustee on each date upon which a distribution is made (each, a
"Distribution Date") as follows:
FIRST, to the payment (in such priority as the Corporate Trustee
shall elect, but without duplication) of all reasonable legal fees and
expenses and other reasonable costs or expenses or other liabilities of
any kind incurred by the Collateral Trustees as secured parties under any
Shared Collateral Document or otherwise in connection with any Shared
Collateral Document or this Agreement (including, without limitation, any
reasonable costs or expenses or liabilities incurred in connection with
the sale of any assets covered by any Shared Collateral Document, or in
the operation or maintenance of any of the assets covered by any Shared
Collateral Document), including the
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reimbursement to any Representative of any amounts theretofore advanced by
such Representative for the payment of such fees, costs and expenses,
except only for any such fees, expenses, costs or liabilities incurred by
any Collateral Trustee as a result of its gross negligence or willful
misconduct in performing or failing to perform any of its duties to the
parties hereto expressly set forth herein; provided, however, that nothing
herein is intended to relieve the Grantors of their duties to pay such
costs, fees, expenses and liabilities otherwise payable to the Collateral
Trustees from funds outside of the Collateral Account, as required by this
Agreement;
SECOND, to the Collateral Trustees (without duplication) in an amount
equal to the Collateral Trustees' Fees which are unpaid as of the
Distribution Date and to any Representative which has theretofore advanced
or paid any such Collateral Trustees' Fees in an amount equal to the
amount thereof so advanced or paid by such Representative prior to such
Distribution Date; provided, however, that nothing herein is intended to
relieve the Grantors of their duties to pay such fees and claims from
funds outside of the Collateral Account, as required by this Agreement;
THIRD, in accordance with paragraph (b) below, with respect to any
proceeds, ratably to the Representatives on behalf of the respective
Secured Holders for application to the Secured Obligations of such Secured
Holders, or, to be held by such Representative (or by the Corporate
Trustee on behalf of such Representative pursuant to Section 5.02 or
otherwise) pending such application, until all such Secured Obligations
have been paid in full; and
FOURTH, any surplus remaining after the payment in full in cash of
the Secured Obligations shall, pursuant to the provisions of Section 8.02,
be paid to the applicable Grantor, its successors or assigns, or to
whomsoever may be lawfully entitled to receive the same, or as a court of
competent jurisdiction may direct.
(b) In order to determine the ratable amount to be distributed to each of
the Representatives pursuant to clause THIRD above on each Distribution Date,
unless otherwise directed in writing by the Required Representative(s), the
Corporate Trustee may rely on a certificate of an Authorized Officer of the
Borrower setting forth the Secured Obligations (identified by type and amount)
outstanding under each Secured Agreement (or with respect to the Sul Guarantee
and the Lake Worth Letter of Credit, whether contingent or outstanding Secured
Obligations under such Secured Agreements) on such Distribution Date. The
ratable portion of the aggregate amount available for distribution hereunder on
any Distribution Date which shall be distributed to each Representative on such
Distribution Date shall be a fraction, (x) the numerator of which shall be the
aggregate amount of Secured Obligations of the Secured Holders represented by
such Representative on such Distribution Date and (y) the denominator of which
shall be the aggregate amount of Secured Obligations of all the Secured Holders
represented by the Representatives on such Distribution Date; provided,
however, that, for such purposes, amounts distributable to a Representative on
a prior Distribution Date and held on behalf of such Representative and the
Secured Holders of such Representative pursuant to Section 5.02 of this
Agreement shall be deemed to have been applied to the Secured Obligations of
the Secured Holders represented by such Representative, regardless of whether
such application has occurred.
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(c) Any amounts to be paid to the Representative of the Lender Parties
pursuant to clause THIRD above shall be applied by the Collateral Trustees for
the ratable benefit of the Lender Parties against the Secured Obligations of
the Secured Holders represented by the Agent under the Credit Agreement as
follows:
FIRST, paid to the Agents for any amounts then owing to the Agents
pursuant to Section 10.03 of the Credit Agreement or otherwise under the
Financing Documents, ratably in accordance with the respective amounts
then owing to the Agents; and
SECOND, ratably (A) paid to the Bank Parties (or any of their
Affiliates) and the Hedge Banks, respectively, for any amounts then owing
to them, in their capacities as such, under the Credit Agreement, the
Secured Treasury Management Service Agreements, and the Secured Hedge
Agreements, respectively, ratably in accordance with such respective
amounts then owing to such Bank Parties and the Hedge Banks, provided
that, for purposes of this Section 5.01(c), (x) the amount owing to any
such Hedge Bank pursuant to any Secured Hedge Agreement to which it is a
party (other than any amount therefore accrued and unpaid) shall be deemed
to be equal to the "▇▇▇▇ to market" value of such Secured Hedge Agreement
at such time and (y) the amounts ratably paid to the Hedge Banks,
collectively, for any amounts owing to them under any Secured Hedge
Agreement (other than the Banc of America Secured Option) shall not exceed
$50,000,000 in the aggregate and (B) deposited as Revolving L/C Collateral
in the Revolving L/C Cash Collateral Account up to an amount equal to 100%
of the aggregate Available Amount of all outstanding Revolving Letters of
Credit and as Drax LOC Collateral in the Drax LOC Cash Collateral Account
up to an amount equal to 100% of the Drax LOC Available Amount.
(d) Any amounts to be paid to the Representatives of the Exchange Note
Holders, the Sul Guaranteed Parties, the Lake Worth LOC Bank and the Other Debt
Holders pursuant to clause THIRD above shall be applied by the Collateral
Trustees for the ratable benefit of the Exchange Note Holders, the Sul
Guaranteed Parties, the Lake Worth LOC Bank and the Other Debt Holders as
follows:
FIRST, paid to the Representatives of the Exchange Note Holders, the
Sul Guaranteed Parties, the Lake Worth LOC Bank and the Other Debt Holders
for any amounts then owing to them under the Exchange Note Agreements, the
Sul Guarantee, the Lake Worth Letter of Credit and the Other Debt
Agreements ratably in accordance with the respective amounts then owing to
such Representatives; and
SECOND, ratably (A) paid to the Exchange Note Holders and the Other
Debt Holders for any amounts then owing to them under the Exchange Note
Indenture and the Other Debt Agreements, (B) upon the instruction of the
Sul Agent, either (x) paid to the Sul Guaranteed Parties for any amounts
then owing to them under the Sul Guarantee or (y) deposited as cash
collateral in an account designated by the Sul Agent in an amount up to
$50,000,000 to secure the Obligations of the Borrower under the Sul
Guarantee and (C) upon the instruction of the Lake Worth LOC Bank, either
(x) paid to the Lake Worth LOC Bank for any amounts then owing to them
under the Lake Worth Letter of Credit or (y) deposited as cash collateral
in an account designated by the Lake Worth LOC Bank in
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an amount up to $5,490,449 to secure the Obligations of Lake Worth under
the Lake Worth Letter of Credit.
SECTION 5.02. Application of Withheld Amounts. If on any Distribution Date
any amounts on deposit to the Collateral Account are distributable pursuant to
Section 5.01 to any Representative, and if such Representative shall have given
notice to the Collateral Trustees on or prior to such Distribution Date that
all or a portion of such proceeds which are otherwise distributable to such
Representative pursuant to Section 5.01 shall be held by the Collateral
Trustees on behalf of such Representative for the benefit of the Secured
Holders of such Representative, then the Collateral Trustees shall hold such
amount in a separate non-interest bearing cash collateral account of the
Corporate Trustee for the benefit of such Representative and such Secured
Holders, until such time as such Representative shall deliver a written request
for the delivery thereof from such account to such Representative in accordance
with Section 5.01(c) or 5.01(d), as applicable. If thereafter the Secured
Obligations of the Secured Holders represented by any such Representative shall
have been repaid in full in cash on any date, then (a) upon the written request
of the Borrower certifying as to such payment in full, and (b) after delivery
of such notice by the Collateral Trustees to such Representative, the
Collateral Trustees shall not have received a written notice of objection from
such Representative within 30 days of such Representative's receipt of such
notice, promptly following such 30th day (or the earlier receipt by the
Collateral Trustees of the written consent of such Representative), any amounts
held on account for such Representative pursuant to this Section 5.02 shall be
again deposited by the Collateral Trustee to the Collateral Account and
thereafter distributed as provided in Section 5.01. If the Borrower shall have
failed to deliver to the Collateral Trustees the certificate provided for in
clause (a) of the immediately preceding sentence, the Collateral Trustees may
request payment instructions from the Required Representative(s) and the
Collateral Trustees shall not be required to make any distributions until such
instructions are received. The Corporate Trustee shall invest amounts on
deposit to any such account in such Cash Equivalents as the applicable
Representative may direct from time to time.
SECTION 5.03. Release of Amounts in Collateral Account. Amounts
distributable to a Representative on any Distribution Date pursuant to Section
5.01 shall be paid to such Representative for the benefit of such
Representative and its Secured Holders by the Corporate Trustee (or deposited
to an account for the benefit of such Representative and its Secured Holders
pursuant to Section 5.02) upon receipt by the Corporate Trustee of a written
certificate of such Representative setting forth appropriate payments
instructions for such Representative. If no such notice is delivered by a
Representative within 10 Business Days thereafter, the Corporate Trustee shall
deposit amounts otherwise distributable to such Representative to an account
for the benefit of such Representative and its Secured Holders pursuant to
Section 5.02 hereof.
SECTION 5.04. Distribution Date. Upon the occurrence and during the
continuance of a Collateral Trust Agreement Default, any amounts on deposit in
the Collateral Account shall, at the written request of the Required
Representative(s) (with a copy to the Grantors) be distributed as provided in
this Article V.
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ARTICLE VI
AGREEMENTS WITH THE COLLATERAL TRUSTEE
SECTION 6.01. Delivery of Agreements. On the Effective Date, the Borrower
shall deliver to the Collateral Trustees a true and complete copy of each
Secured Agreement, including each Shared Collateral Document, as in effect on
the Effective Date. The Borrower agrees that, promptly upon the execution
thereof, the Borrower will deliver to the Collateral Trustees a true and
complete copy of any and all Shared Collateral Documents and other Secured
Agreements entered into subsequent to the date hereof and a true and complete
copy of any and all amendments, modifications or supplements to any of the
foregoing.
SECTION 6.02. Information as to Representatives. (a) The Borrower agrees
that it shall deliver to the Collateral Trustees from time to time upon the
request of the Collateral Trustees a list setting forth, for each Secured
Agreement, (i) the aggregate principal amount outstanding thereunder, (ii) the
accrued and unpaid interest thereunder, (iii) the accrued and unpaid fees (if
any) thereunder, (iv) the names of the Representatives and of the Secured
Holders (to the extent known to the Borrower) thereunder, and all other unpaid
amounts thereunder known to the Borrower, owing to each such Representative,
for its own account and on behalf of such Secured Holders and (v) such other
information regarding the Representatives, such Secured Holders and the Secured
Agreements as the Collateral Trustees may reasonably request. In addition, the
Borrower shall deliver to the Collateral Trustees, each time a distribution
from the Collateral Trust Estate or, the Collateral Account is to be made
pursuant to the terms hereof, not later than two Business Days after receipt of
a copy of the applicable distribution request delivered by the Required
Representative(s) pursuant to Section 5.04 hereof, a certificate of an
Authorized Officer of the Borrower, setting forth the amounts to be distributed
and the Persons to whom such distributions are to be made, including
appropriate payment instructions therefor (the "Payment Information"), provided
that if any distribution is directed to be made to any Representative, if such
Representative shall have notified the Collateral Trustees in writing that such
Representative is unable to accept such distribution, such distribution shall
be made instead to an account established pursuant to Section 5.02 hereof for
the benefit of such Representative and its Secured Holders. The Borrower will
furnish to the Collateral Trustees, with a copy to each Representative, on the
Effective Date a list setting forth the name and address of each Representative
and each Person to whom notices must be sent under the Secured Agreements and
the Borrower agrees to furnish promptly to the Collateral Trustees any changes
or additions to such list of which the Borrower is made aware. Unless otherwise
specified herein, the Collateral Trustees may for all purposes hereunder, rely
on such information given by the Borrower unless (i) the Collateral Trustees
shall have actual knowledge of an inaccuracy or (ii) any Representative shall
provide contrary information in writing with respect to such Representative in
which case, unless such Representative and the Borrower can reach an agreement
on such issue within a period of 10 days, the Collateral Trustees shall appoint
an independent arbitrator (who shall be reasonably acceptable to the Borrower
and such Representative) to resolve the dispute (at the expense of the
Borrower). Upon the request of the Collateral Trustees, the Agent and the other
Representatives shall deliver the information provided for in this Section
6.02.
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(b) If the Borrower shall not have delivered the Payment Information to
the Collateral Trustees at least two Business days prior to the applicable
Distribution Date, the Collateral Trustees shall request the Payment
Information from the Agent and the other Representatives, and if after such
request the Collateral Trustees shall not have received the Payment Information
from any of the Borrower, the Agent or the other Representatives, the
Collateral Trustees shall not be required to take any action under clause THIRD
of Section 5.01(a) until it receives such Payment Information.
SECTION 6.03. Compensation and Expenses. Each Grantor agrees to pay to the
Collateral Trustees and any co-trustees or successor trustees appointed
hereunder, from time to time upon demand, (a) such compensation for their
services hereunder and under the other Shared Collateral Documents and for
administering the other Collateral Trust Estate, the Collateral Account and any
account or accounts established pursuant to Section 5.02 hereof as set forth on
the fee schedule attached hereto as Schedule 1, as such Schedule 1 may be
amended, supplemented or otherwise modified by the written agreement of the
Grantors and the Collateral Trustees from time to time and (b) all the
reasonable fees, costs and expenses incurred by any of them (including, without
limitation, the reasonable fees and disbursements of counsel) (i) arising in
connection with the preparation, execution, delivery, modification and
termination of this Agreement and each other Shared Collateral Document or the
enforcement of any of the provisions hereof or thereof or (ii) incurred or
required to be advanced in connection with the administration of the Collateral
Trust Estate, the Collateral Account, any account or accounts established
pursuant to Section 5.02 hereof, the sale or other disposition of Collateral
pursuant to any Shared Collateral Document and the preservation, protection or
defense of their rights under this Agreement and in and to the Collateral, the
Collateral Account, any account or accounts established pursuant to Section
5.02 hereof and the Collateral Trust Estate. As security for such payment, the
Collateral Trustees shall have a prior lien upon all Collateral and other
property and funds held or collected by the Collateral Trustees as part of the
Collateral Trust Estate. Each Grantor's obligation under this Section 6.03
shall survive the termination of this Agreement.
SECTION 6.04. Stamp and Other Similar Taxes. Each Grantor agrees to
indemnify and hold harmless the Collateral Trustees, each Representative and
each Secured Holder from any present or future claim for liability for any
stamp or other similar tax and any penalties or interest with respect thereto,
which may be assessed, levied or collected by any jurisdiction in connection
with this Agreement, any Shared Collateral Document, the Collateral Trust
Estate, the Collateral Account, any account or accounts established pursuant to
Section 5.02 hereof or any Collateral. The obligations of each Grantor under
this Section 6.04 shall survive the termination of this Agreement.
SECTION 6.05. Filing Fees, Excise Taxes, Etc. Each Grantor agrees to pay
or to reimburse the Collateral Trustees for any and all amounts in respect of
all reasonable search, filing, recording and registration fees, taxes, excise
taxes and other similar imposts which may be payable or determined to be
payable in respect of the execution, delivery, performance and enforcement of
this Agreement and each other Shared Collateral Document. The obligations of
each Grantor under this Section 6.05 shall survive the termination of this
Agreement.
SECTION 6.06. Indemnification. (a) Each Grantor agrees to pay, indemnify,
and hold harmless the Collateral Trustees and each of the agents of either
thereof from and against
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any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever (including, without limitation, the costs and expenses of defending
any claim against any of them) with respect to the execution, delivery,
enforcement, performance and administration of this Agreement and the other
Shared Collateral Documents unless and to the extent arising from the gross
negligence or willful misconduct of such of the Collateral Trustees or such of
the agents thereof as are seeking indemnification or any failure of any
Collateral Trustee or any such agent to exercise ordinary care in the handling
of moneys and securities and other property actually received by any such
Collateral Trustee or any such agent. As security for such payment, any such
Collateral Trustee shall have a prior lien upon all Collateral and other
property and funds held or collected by the Collateral Trustees as part of the
Collateral Trust Estate.
(b) In any suit, proceeding or action brought by the Collateral Trustees
under or with respect to any Shared Collateral Document or the Collateral for
any amount owing thereunder, or to enforce any provisions thereof, each Grantor
will save, indemnify and hold harmless the Collateral Trustees, the
Representatives and the Secured Holders from and against all expense, loss or
damage suffered by reason of any defense, set-off, counterclaim, recoupment or
reduction of liability whatsoever of the obligee thereunder (unless and to the
extent that such expense, loss or damage is caused by the gross negligence or
willful misconduct of the such Collateral Trustee or the failure of any
Collateral Trustee to exercise ordinary care in the handling of moneys and
securities and other property actually received by such Collateral Trustee),
arising out of a breach by such Grantor of any obligation thereunder or arising
out of any other agreement, indebtedness or liability at any time owing to or
in favor of such obligee or its successors from such Grantor and all such
obligations of such Grantor shall be and remain enforceable against and only
against such Grantor and shall not be enforceable against the Collateral
Trustees, any Representative or any Secured Holder. The agreements in this
Section 6.06 shall survive the termination of this Agreement.
SECTION 6.07. Further Assurances. (a) Each Grantor agrees, from time to
time, at its own expense to execute, acknowledge, deliver, record, re-record,
file, re-file, register and re-register, and cause its Subsidiaries, if any, to
promptly execute, acknowledge, deliver, record, re-record, file, re-file,
register and re-register any and all such further acts, financing statements
and continuations thereof, notices of assignment, transfers, certificates,
assurances and other instruments as may be reasonably necessary or desirable,
or as any Collateral Trustee, any Representative, any Secured Holder through
its Representative, may reasonably request from time to time in order (i) to
carry out more effectively the purposes of this Agreement, (ii) to subject to
the liens and security interests created by any of the Shared Collateral
Documents any of the properties, rights or interests of such Grantor covered or
now or hereafter intended to be covered by any of the Shared Collateral
Documents, (iii) to perfect and maintain the validity, effectiveness and
priority of any of the Shared Collateral Documents and the liens and security
interests intended to be created thereby, (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm unto the Collateral Trustees,
the Representatives and the Secured Holders the rights granted or now or
hereafter intended to be granted to the Collateral Trustees, the
Representatives and the Secured Holders under any Shared Collateral Document or
under any other instrument executed in connection with any Shared Collateral
Document to which it is or may become a party, and (v) to enable the Collateral
Trustees to exercise and enforce their rights and remedies hereunder and under
each other Shared Collateral Document with respect to
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any Collateral; provided, however, that this Section 6.07 shall not be
construed to require any Grantor to grant any interest in Collateral other than
pursuant to this Agreement, the Credit Agreement or any other Shared Collateral
Document. Without limiting the generality of the foregoing, each Grantor will
take any such action required to be taken by it pursuant to any Shared
Collateral Document.
(b) Each Grantor hereby authorizes the Collateral Trustees to file one or
more financing or continuation statements relative to all or any part of the
Collateral, and amendments thereto to correct the name and address of such
Grantor or the Collateral Trustees or to correct the description of the
"Collateral" contained in any of the Shared Collateral Documents to be
consistent with the description of the Collateral contained in such Shared
Collateral Document, in each case without the signature of such Grantor where
permitted by law and which shall be filed by the Collateral Trustees upon the
receipt of an instruction letter from the Required Representatives requesting
the taking of such action and attaching the form of financing statement. A
photocopy or other reproduction of this Agreement, any other Shared Collateral
Document or any financing statement covering the Collateral or any part thereof
shall be sufficient as a financing statement where permitted by law.
(c) The Grantors will furnish such information about the Collateral as the
Collateral Trustees may reasonably request from time to time.
ARTICLE VII
THE COLLATERAL TRUSTEE
SECTION 7.01. Declaration of Trust. Each of the Corporate Trustee and the
Individual Trustee, for itself and its successors, hereby accepts the trusts
created by this Agreement upon the terms and conditions hereof, including those
contained in this Article VII. Further, each of the Corporate Trustee and the
Individual Trustee, for itself and its successors, does hereby declare that it
will hold all of the estate, right, title and interest in (a) the Collateral
Trust Estate and the Collateral Account for the equal and ratable benefit of
the Representatives and the Secured Holders as provided herein, and (b) each
account as may be established pursuant to Section 5.02 at the request of a
Representative upon the trust herein set forth and for the benefit of such
Representative on behalf of its applicable Secured Holders as provided herein.
SECTION 7.02. Exculpatory Provisions. (a) The Collateral Trustees shall
not be responsible in any manner whatsoever for the correctness of any
recitals, statements, representations or warranties contained herein or in the
other Shared Collateral Documents, all of which are made solely by the Grantors
party thereto. The Collateral Trustees make no representations as to the value
or condition of the Collateral Trust Estate, the Collateral Account or any part
thereof, or as to the title of the Grantors thereto or as to the security
afforded by this Agreement or the other Shared Collateral Documents or as to
the validity, execution (except its own execution), enforceability, legality or
sufficiency of this Agreement, any other Shared Collateral Document or any
Secured Agreement, and the Collateral Trustees shall incur no liability or
responsibility in respect of any such matters. The Collateral Trustees shall
not be responsible for insuring the Collateral Trust Estate or for the payment
of taxes, charges, assessments or liens upon the Collateral Trust Estate or
otherwise as to the maintenance of the
▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ or the Collateral Account, except that in any event
that any Collateral Trustee enters into possession of a part or all of the
Collateral Trust Estate or the Collateral Account, such Collateral Trustee,
shall preserve the part in its possession.
(b) The Collateral Trustees shall not be required to ascertain or inquire
as to the performance by the Grantors of any of the covenants or agreements
contained herein, in any other Shared Collateral Document or in any Secured
Agreement.
SECTION 7.03. Delegation of Duties. The Collateral Trustees may execute
any of the trusts or powers hereof and perform any duty hereunder either
directly or by or through agents or attorneys-in-fact (which shall not include
officers and employees of any Grantor or any Affiliate of any Grantor). The
Collateral Trustees shall be entitled to rely upon advice of reasonably
selected counsel and other professionals concerning all matters pertaining to
such trusts, powers and duties. The Collateral Trustees shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
reasonably selected by them in good faith.
SECTION 7.04. Reliance by Collateral Trustees. (a) Whenever in the
administration of the trusts of this Agreement or, pursuant to any other Shared
Collateral Document, the Collateral Trustees shall deem it necessary or
desirable that a matter be proved or established in connection with the taking,
suffering or omitting any action hereunder by the Collateral Trustees unless
otherwise provided herein, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be conclusively
proved or established by a certificate of an Authorized Officer of the Borrower
delivered to the Collateral Trustees and the Representatives, and such
certificate shall constitute a full warranty to the Collateral Trustees for any
action taken, suffered or omitted in reliance thereon unless (i) the Collateral
Trustees shall have actual knowledge of an inaccuracy therein or (ii) the
Required Representative(s) shall provide contrary information in writing with
respect to such matter within 10 days of receipt thereof by such Required
Representative(s), in which case unless such Required Representative(s) and the
Grantors can reach agreement on such issue within a period of 10 days, the
Collateral Trustees shall appoint, at the expense of the Grantors, an
independent arbitrator (who shall be reasonably acceptable to the Grantors and
such Required Representative(s)) to resolve the dispute.
(b) The Collateral Trustees may consult with independent counsel,
independent public accountants and other experts selected by it (excluding,
counsel to or any employee of any Grantor or any Affiliate of any Grantor) and
any opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken or suffered by them hereunder in
accordance therewith unless such Collateral Trustee has actual knowledge of a
reason to question the validity or accuracy of such opinion or of any
assumptions expressed therein as the basis for such opinion. The Collateral
Trustees shall have the right at any time to seek instructions concerning the
administration of the Collateral Trust Estate or the Collateral Account or any
account established pursuant to Section 5.02 hereof from any court of competent
jurisdiction.
(c) The Collateral Trustees may rely, and shall be fully protected in
acting, upon any resolution, statement, certificate, instrument, opinion,
report, notice, request, consent, order, bond or other paper or document which
they reasonably believe to be genuine and to have
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been signed or presented by the proper party or parties or, in the case of
telecopies and telexes, to have been sent by the proper party or parties. In
the absence of its gross negligence or willful misconduct, each Collateral
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any notices, certificates
or opinions furnished to such Collateral Trustee that conform to the
requirements of this Agreement or any other Shared Collateral Document.
SECTION 7.05. Limitations on Duties of the Trustees. (a) The Collateral
Trustees undertake to perform only the duties expressly set forth herein and no
implied covenant or obligation shall be read into this Agreement against the
Collateral Trustees.
(b) The Collateral Trustees may exercise the rights and powers granted to
them by this Agreement and the other Shared Collateral Documents, but only
pursuant to the terms of this Agreement, and the Collateral Trustees shall not
be liable with respect to any action taken or omitted by them in accordance
with the direction of the Required Representative(s).
(c) Except as herein otherwise expressly provided, the Collateral Trustees
shall not be under any obligation to take any action which is discretionary
with the Collateral Trustees under the provisions hereof or under any other
Shared Collateral Document except upon the written request of the Required
Representative(s). The Collateral Trustees shall make available for inspection
and copying by each Representative each certificate or other paper furnished to
the Collateral Trustees by the Grantors, by any Representative, or by any other
Person, under or in respect of this Agreement, any other Shared Collateral
Document or any of the Collateral Trust Estate.
(d) The Collateral Trustees shall be under no obligation to exercise any
of the rights or powers vested in them by this Agreement or any other Shared
Collateral Document at the request or direction of any Representatives pursuant
to this Agreement, unless such Representatives shall have offered to the
Collateral Trustees security or indemnity satisfactory to the Collateral
Trustees against the costs, expenses and liabilities which might be incurred by
them in compliance with such request or direction.
(e) Each Secured Holder (other than the Agents and any other
Representative, in its capacity as a "representative") shall, ratably
(determined as provided below) indemnify the Collateral Trustees, each of their
respective Affiliates and the respective directors, officers, agents and
employees of any of them (to the extent not reimbursed by the Borrower) against
any cost, expense (including counsel fees and disbursements), claim, demand,
action, loss or liability (except such as result from such indemnitees' gross
negligence or willful misconduct) (an "Indemnified Event") that such
indemnitees may suffer or incur in connection with its exercise of rights and
remedies with respect to the Account Collateral and the Securities Accounts.
For purposes of this Section 7.05(e), each Secured Holder's ratable share shall
be based on the amounts owing to each such Secured Holder under its respective
Secured Agreement at the time the Indemnified Event arose.
(f) The Obligations of the Collateral Trustees hereunder are several and
not joint.
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SECTION 7.06. Moneys to Be Held in Trust. All moneys received by the
Corporate Trustee under or pursuant to any provision of this Agreement or any
other Shared Collateral Document shall be segregated and held in trust for the
purposes for which they were paid or are held and the Corporate Trustee shall
exercise ordinary care in the handling of any such moneys actually received by
it. The Individual Trustee shall promptly turn over to the Corporate Trustee
any Collateral, or any part thereof, delivered to or received by the Individual
Trustee.
SECTION 7.07. Resignation and Removal of Collateral Trustees. (a) Each or
both of the Collateral Trustees may at any time, by giving 30 days' prior
written notice to the Grantors and the Representatives, resign and be
discharged of their responsibilities hereby created, such resignation to become
effective upon the appointment of a successor trustee or trustees by the
Required Representative(s), the acceptance of such appointment by such
successor trustee or trustees and, unless a Collateral Trust Agreement Default
has occurred and is continuing, the consent to the appointment of such
successor trustee or trustees by the Grantors. If a Collateral Trust Agreement
Default has occurred, the Grantors' consent to any such resignation shall not
be required. The Collateral Trustees shall be entitled to their fees and
expenses accrued to the date of the resignation becoming effective. Either or
both of the Collateral Trustees may be removed at any time (with or without
cause) and a successor trustee or trustees appointed by the affirmative vote of
the Required Representative(s), subject to, unless a Collateral Trust Agreement
Default has occurred and is continuing, the consent of the Grantors, provided
that the Collateral Trustees or either of them shall be entitled to their fees
and expenses accrued to the date of removal. If either or both of the
Collateral Trustees resigns or is removed as provided in this Section 7.07 the
consent to the appointment of a successor trustee or trustees shall not be
unreasonably withheld and shall be deemed to have been given if the Grantors
shall not have reasonably objected to any proposed successor trustee or
trustees within five Business Days of receipt of notice of the identity thereof
from the Representatives. If no successor trustee or trustees shall be
appointed and approved within 30 days from the date of the giving of the
aforesaid notice of resignation or within 30 days from the date of such vote
for removal, the Collateral Trustees, shall, or the Required Representative(s)
may, apply to any court of competent jurisdiction to appoint a successor
trustee or trustees to act until such time, if any, as a successor trustee or
trustees shall have been appointed as above provided. Any successor trustee or
trustees so appointed by such court shall immediately and without further act
be superseded by any successor trustee or trustees approved by the Required
Representative(s) as above provided.
(b) If at any time either or both of the Collateral Trustees shall become
incapable of acting, or if at any time a vacancy shall occur in the office of
the Collateral Trustees for any other cause, a successor trustee or trustees
shall be promptly appointed by the Required Representative(s), subject to,
unless a Collateral Trust Agreement Default has occurred and is continuing, the
consent of the Grantors, which consent shall not be unreasonably withheld, and
the powers, duties, authority and title of the predecessor trustee or trustees
terminated and cancelled without procuring the resignation of such predecessor
trustee or trustees, and without any formality (except as may be required by
applicable law) other than appointment and designation of a successor trustee
or trustees in writing, duly acknowledged, delivered to the predecessor trustee
or trustees and the Grantors and filed for record in each public office, if
any, in which this Agreement is required to be filed.
26
(c) The appointment and designation referred to in Section 7.07(b) shall,
after any required filing, be full evidence of the right and authority to make
the same and of all the facts therein recited, and this Agreement shall vest in
such successor trustee or trustees, without any further act, deed or
conveyance, all of the estate and title of its predecessor, and upon such
filing for record the successor trustee or trustees shall become fully vested
with all the estates, properties, rights, powers, trusts, duties, authority and
title of its predecessor; but such predecessor shall, nevertheless, on the
written request of the Required Representative(s), the Grantors or its
successor trustee or trustees, execute and deliver an instrument transferring
to such successor all the estates, properties, rights, powers, trusts, duties,
authority and title of such predecessor hereunder and shall deliver all
securities and moneys held by it or them to such successor trustee or trustees.
Should any deed, conveyance or other instrument in writing from the Grantors be
required by any successor trustee or trustees for more fully and certainly
vesting in such successor trustee or trustees the estates, properties, rights,
powers, trusts, duties, authority and title vested or intended to be vested in
the predecessor trustee or trustees, any and all such deeds, conveyances and
other instruments in writing shall, on request of such successor trustee or
trustees, be executed, acknowledged and delivered by the Grantors.
(d) Any required filing for record of the instrument appointing a
successor trustee or trustees as hereinabove provided shall be at the expense
of the Grantors. The resignation of any trustee or trustees and the instrument
removing any trustee or trustees, together with all other instruments, deeds
and conveyances provided for in this Article VII shall, if permitted by law, be
forthwith recorded, registered and filed by and at the expense of the Grantors,
wherever this Agreement is recorded, registered and filed.
SECTION 7.08. Status of Successors to Trustee. Every successor to the
Corporate Trustee appointed pursuant to Section 7.07 shall be a bank or trust
company in good standing and having power so to act, incorporated under the
laws of the United States or any State thereof or the District of Columbia and
having its principal corporate trust office within the State of Delaware, or
another state acceptable to the Required Representative(s), and shall also have
capital, surplus and undivided profits of not less than $100,000,000, if there
be such an institution with such capital, surplus and undivided profits
willing, qualified and able to accept the trust upon reasonable or customary
terms. Any successor to the Individual Trustee appointed pursuant to Section
7.07 shall be an individual residing in the State of Delaware, the State of New
York or another state of the United States acceptable to the Required
Representative(s).
SECTION 7.09. Merger of the Corporate Trustee. Any corporation into which
the Corporate Trustee may be merged, or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the
Corporate Trustee shall be a party, shall be the Corporate Trustee under this
Agreement without the execution or filing of any paper or any further act on
the part of the parties hereto.
SECTION 7.10. Powers of Individual Trustee. The Individual Trustee has
been joined as a party hereunder so that if, by any present or future
applicable law in any jurisdiction in which it may be necessary to perform any
act in the execution or enforcement of the trusts hereby created, the Corporate
Trustee may be incompetent, unqualified or unable to act as a Collateral
Trustee, then all of the acts required to be performed in such jurisdiction, in
the execution or enforcement of the trusts hereby created, shall and will be
performed by the
27
Individual Trustee, acting alone. Notwithstanding any other term or provision
of this Agreement to the contrary, the Corporate Trustee alone shall have and
exercise the rights and powers granted herein and shall be solely charged with
the performance of the duties herein declared on the part of the Collateral
Trustees to be had and exercised or to be performed without any action taken by
the Individual Trustee; provided, however, that if the Corporate Trustee or the
Required Representative(s) deem it necessary or desirable for the Individual
Trustee to act in a particular jurisdiction, the Individual Trustee shall have
and exercise the rights and powers granted herein (but no greater powers) and
shall be charged with the performance of the duties herein declared on the part
of the Collateral Trustees to be had and exercised or to be performed, but only
in such particular jurisdiction.
SECTION 7.11. Additional Co-Trustees; Separate Trustees. (a) If at any
time or times it shall be necessary or prudent in order to conform to any law
of any jurisdiction in which any of the Collateral shall be located, or the
Collateral Trustees shall be advised by counsel satisfactory to them that it is
so necessary or prudent in the interest of the Representatives on behalf of the
Secured Holders, or the Required Representative shall in writing so request by
notice to the Collateral Trustees and the Grantors, or the Collateral Trustees
shall deem it desirable for their own protection in the performance of their
duties hereunder, or the Grantors shall in writing so request by notice to the
Collateral Trustees with the consent of the Required Representative, the
Collateral Trustees and the Grantors shall execute and deliver all instruments
and agreements necessary or proper to constitute another bank or trust company,
or one or more persons approved by the Collateral Trustees, the Grantors and
the Required Representative, either to act as co-trustee or co-trustees of all
or any of the Collateral, jointly with the Collateral Trustees originally named
herein or any successor, or to act as separate trustee of any such property. In
the event the Grantors shall not have joined in the execution of such
instruments and agreements within 10 days after the receipt of a written
request from the Collateral Trustees so to do, or in case a Collateral Trust
Agreement Default shall have occurred and be continuing, the Collateral
Trustees may act under the foregoing provisions of this Section 7.11 without
the concurrence of the Grantors (but with the concurrence of the Required
Representative), and the Grantors hereby appoint the Collateral Trustees as
their agents and attorneys to act for them under the foregoing provisions of
this Section 7.11 in either of such contingencies.
(b) Any separate trustee and any co-trustee (other than any trustee which
may be appointed as successor to the Corporate Trustee or the Individual
Trustee pursuant to Section 7.07) shall, to the extent permitted by law, be
appointed and act and be such, subject to the following provisions and
conditions, namely:
(i) all rights, powers, duties and obligations conferred upon the
trustees in respect of the custody, control and management of moneys,
papers or securities shall be exercised solely by the Collateral Trustees
originally named herein or their successors appointed pursuant to Section
7.07;
(ii) all rights, powers, duties and obligations conferred or imposed
upon the Collateral Trustees hereunder shall be conferred or imposed and
exercised or performed by the Collateral Trustees and such separate
trustee or co-trustee, jointly, as shall be provided in the instrument
appointing such separate trustee or co-trustee, except to the extent that
under any law of any jurisdiction in which any particular act or acts are
to be
28
performed the Collateral Trustees shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations shall be exercised and performed by such separate trustee or
co-trustee;
(iii) no power given hereby to, or which it is provided hereby may be
exercised by, any such co-trustee or separate trustee, shall be exercised
hereunder by such co-trustee or separate trustee, except jointly with, or
with the consent in writing of, the Collateral Trustees, anything herein
contained to the contrary notwithstanding;
(iv) no trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder; and
(v) the Grantors and the Collateral Trustees, at any time, by an
instrument in writing, executed by them jointly, may accept the
resignation of or remove any such separate trustee, and in that case, by
an instrument in writing executed by the Grantors and the Collateral
Trustees jointly, may appoint a successor (who shall be acceptable to the
Required Representative(s)) to such a separate trustee or co-trustee, as
the case may be, anything herein contained to the contrary
notwithstanding. In the event that the Grantors shall not have joined in
the execution of any such instrument within 10 days after the receipt of a
written request from the Collateral Trustees so to do, or in case a
Collateral Trust Agreement Default shall have occurred and be continuing,
the Collateral Trustees shall have the power to accept the resignation of
or remove any such separate trustee or co-trustee and to appoint (with the
consent of the Required Representative(s)) a successor without the
concurrence of the Grantors and the Grantors hereby appoint the Collateral
Trustees their agents and attorneys to act for them in such connection in
either of such contingencies. In the event that the Collateral Trustees
shall have appointed a separate trustee or co-trustee or as above
provided, they may at any time, by an instrument in writing, accept the
resignation of or remove any such separate trustee, the successor to any
such separate trustee to be appointed by the Grantors and the Collateral
Trustees, or by the Collateral Trustees alone, as hereinbefore provided in
this Section 7.11.
SECTION 7.12. Trustees Appointed Attorneys-in-Fact. Each Grantor hereby
irrevocably constitutes and appoints the Collateral Trustees and any officer or
agent thereof, with full power of substitution, as its true and lawful
attorneys-in-fact with full power and authority in the name of such Grantor or
their own name and in the place and stead of such Grantor and in the name of
such Grantor, from time to time at the direction of the Required
Representative(s), to take any action and to execute any instrument which the
same may deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation, to receive, endorse and collect all
instruments made payable to such Grantor representing any dividend, interest
payment or other distribution in respect of the Collateral or any part thereof
and to give full discharge for the same in accordance with the terms of the
Shared Collateral Documents. Each Grantor acknowledges and agrees that the
foregoing power of attorney is coupled with an interest and may not be revoked
or modified except with the consent of the Collateral Trustees or as otherwise
provided herein.
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SECTION 7.13. Ordinary Care. The Collateral Trustees shall be deemed to
have exercised ordinary care in the custody and preservation of the Collateral
in their possession if the Collateral is accorded treatment substantially equal
to that which the Collateral Trustees accord their own property, it being
understood that the Collateral Trustees shall not have any responsibility for
(i) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Collateral,
whether or not the Collateral Trustees have or are deemed to have knowledge of
such matters, or (ii) taking any necessary steps to preserve rights against any
parties with respect to any Collateral.
ARTICLE VIII
RELEASE OF COLLATERAL
SECTION 8.01. Partial Release of Collateral. (a) Any Grantor may, from
time to time so long as no Collateral Trust Agreement Default shall have
occurred and be continuing, request the release of the lien and security
interest of the Shared Collateral Documents in any portion of the Collateral of
such Grantor proposed to be sold or otherwise disposed of by such Grantor to
any other Person, upon notice to the Collateral Trustees from an Authorized
Officer of the Borrower (a "Notice of Partial Release"), which Notice of
Partial Release shall be delivered to the other Grantors, the Collateral
Trustees and the Representatives at least twenty Business Days prior to the
date of the proposed sale or other disposition of such Collateral (unless a
shorter period of time is acceptable to the Collateral Trustees and the
Required Representative(s)) and shall
(i) specify the Collateral to be so sold or otherwise disposed of and
the proposed date of such sale or other disposition, and
(ii) certify that the sale or other disposition of such Collateral is
in compliance with the terms of the Applicable Agreements, and the
Grantors are not, and after giving effect to such release, would not be,
in default under the Applicable Agreements.
If a Notice of Partial Release is delivered to the Collateral Trustees in
accordance with the immediately preceding sentence and the Required
Representative(s), shall not have objected in writing thereto prior to the date
of the proposed release, the security interest in such Collateral shall
automatically, without further action, be released and the Collateral Trustees
shall execute and deliver to the Grantors, on the date of the proposed release
(or as promptly thereafter as possible), a release or releases (including,
without limitation, Uniform Commercial Code release statements and instruments
of satisfaction, discharge and/or reconveyance) in recordable form as to the
Collateral specified in such Notice of Partial Release from the liens, security
interests, conveyances and assignments evidenced by the Shared Collateral
Documents, which release shall state that it is effective as of the date of
such disposition; provided, however, that, if prior to the time that the
Collateral Trustees deliver a release pursuant to this Section 8.01(a), the
Collateral Trustees shall have received either (A) a Collateral Trust Agreement
Default Notice that shall not have been withdrawn prior to such time and the
Required Representative(s) shall have directed the Collateral Trustees either
not to deliver such a release or not to deliver releases generally or (B) a
written objection from the Required Representative(s) stating that such sale or
other disposition is not permitted under the Applicable Agreement, then, in
either case, the
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Collateral Trustees shall so notify the Grantors and shall not sign any release
or releases in connection with such disposition.
(b) If, at any time, the Collateral Trustees shall receive a written
notice from an Authorized Officer of the Borrower, (i) stating that any
promissory note or other similar or related instrument evidencing obligations
payable to such Grantor and included in the Collateral has been paid in full in
accordance with its terms (or will be so paid concurrently with the surrender
thereof), and (ii) identifying such note or other instrument in reasonable
detail (including, without limitation, by its date of issuance, the name of its
payee and the principal amount thereof), then the Collateral Trustees shall
promptly deliver a copy of each such notice to the other Grantors, each
Representative and, unless the Required Representative(s) shall have disputed
the accuracy of such notice within ten Business Days of the delivery of such
notice, the Collateral Trustees shall promptly deliver such note or other
instrument to the Borrower, and promptly execute and deliver a release or
releases (including, without limitation, Uniform Commercial Code release
statements) in recordable form as to any such note or other instrument from the
liens, security interests, conveyances and assignments evidenced by the Shared
Collateral Documents, which release shall state that it is effective as of the
date of its delivery.
SECTION 8.02. Full Release of Collateral Upon Satisfaction of Certain
Secured Obligations. (a) The Collateral Trustees shall promptly release, in
accordance with Section 8.03, all the Collateral upon the latest of the (i)
cash payment in full of all Secured Obligations arising under the Credit
Agreement, the Notes, the Banc of America Secured Option, the Exchange Note
Agreements, the Sul Guarantee, the Lake Worth Letter of Credit, the Other Debt
Agreements and each other agreement or instrument delivered by the Grantors
pursuant thereto, (ii) termination of the Exchange Note Indenture, (iii) the
termination of the Revolving Credit Loan Commitments and (iv) the termination
or expiration of all Revolving Letters of Credit and the Drax Letter of Credit.
(b) In furtherance of the undertaking set forth above in Section 8.02(a),
the Collateral Trustees shall, upon the request of the Grantors accompanied by
a certificate of an Authorized Officer of each Grantor, upon which the
Collateral Trustees may conclusively rely without independent verification, to
the effect that all Secured Obligations under the Secured Agreements referred
to in clause (i) of the preceding subsection (a) have been, or will,
concurrently with the release of the Collateral be, paid in full in cash and
all Revolving Credit Loan Commitments, all Revolving Letters of Credit and the
Drax Letter of Credit have been terminated (and if such Secured Obligations
have not previously been so paid, describing the source(s) of funds for such
repayment), deliver a notice by registered mail to each of the Representatives
containing the following:
(i) a statement as to the total amount of moneys in the Collateral
Account and any account which has been established at the request of any
Representative pursuant to Section 5.02; and
(ii) a statement that the Collateral Trustees will release such
Collateral only upon receipt from the Representatives of instructions to
do so.
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If the Collateral Trustees receive a direction from the Representatives to so
release such Collateral (and the Collateral Trustees shall not have received
any notice that a Collateral Trust Agreement Default has occurred or is
continuing), then the Collateral Trustees shall release all the Collateral from
the security interest in their favor and deliver to the Grantors all Collateral
in the possession of the Collateral Trustees as specified in such instruction;
provided, however, that the Grantors shall have made adequate provision for the
expenses of the Collateral Trustees associated with such release of Collateral
and all other expenses of, or payable to, the Collateral Trustees hereunder. If
the Collateral Trustees shall not have received an instruction so to release
such Collateral (or shall have received a Collateral Trust Agreement Default
Notice which has not been withdrawn), the Collateral Trustees shall not release
the Collateral unless and until the Representatives or a court of competent
jurisdiction so directs the Collateral Trustees pursuant to a final,
non-appealable judgment (including a judgment that becomes non-appealable by
reason of expiration of any period of time limiting the right to appeal
therefrom).
SECTION 8.03. Effect of Release of Collateral. Upon the effectiveness of
the release of the Collateral pursuant to Section 8.02, all right, title and
interest of the Collateral Trustees and the Representatives on behalf of the
Secured Holders in, to and under the Collateral Trust Estate, the Collateral
and the Shared Collateral Documents shall terminate and shall revert to the
Grantors and their successors and assigns, and the estate, right, title and
interest of the Collateral Trustees therein shall thereupon cease; and in such
case, upon the written request of the Grantors, their successors or assigns,
and at the cost and expense of the Grantors, their successors or assigns, the
Collateral Trustees shall promptly execute and deliver a satisfaction of the
Shared Collateral Documents and such instruments as are necessary or desirable
to terminate and remove of record any documents constituting public notice of
the Shared Collateral Documents and the security interests granted thereunder
and shall transfer, or cause to be transferred, and shall deliver or cause to
be delivered to the Grantors, all property, including all moneys, instruments
and securities of the Grantors then held by the Collateral Trustees. The
cancellation and satisfaction of the Shared Collateral Documents shall be
without prejudice to the rights of the Collateral Trustees or any successor
trustee or trustees to charge and be reimbursed for any expenditures which they
may thereafter incur in connection therewith.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Supplements and Waivers. (a) With the written
consent of the Required Representative(s) and the Corporate Trustee, the
Grantors may, from time to time, enter into written agreements supplemental
hereto for the purpose of adding to or waiving any provision of this Agreement
or any other Shared Collateral Document or changing in any manner the rights of
the Collateral Trustees, the Representatives, the Secured Holders and the
Grantors hereunder or thereunder; provided that
(i) no such amendment, waiver or consent shall, unless the approval of all
the Representatives existing at such time shall have been obtained, amend,
waive or otherwise modify any provision of Sections 5.01, 8.01, 8.02 and 9.01
or amend or otherwise modify the definitions of "Required Representative(s)",
"Secured Agreements", "Secured Holders", "Secured Obligations" or "Collateral
Trust Agreement Default" set forth in Section 1.01,
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(ii) no such amendment, waiver or consent shall amend, waive or otherwise
modify this Agreement or any other Shared Collateral Document unless such
amendment, waiver or consent complies with the amendment provisions (or other
similar provisions) of the then outstanding Applicable Agreements,
(iii) no such amendment, waiver or consent shall, unless in writing and
signed by the Individual Trustee, amend, waive or otherwise modify any
provision of Section 7.10,
(iv) any such supplemental agreement shall be binding upon the Grantors,
the Representatives, the Secured Holders and the Collateral Trustees and their
respective successors,
(v) the Collateral Trustees shall not enter into any such supplemental
agreement unless they shall have received a certificate of an Authorized
Officer of each Grantor to the effect that such supplemental agreement will not
result in a breach of any provision or covenant contained in the Applicable
Agreement, and
(vi) the Collateral Trustees shall not enter into any such supplemental
agreement unless they shall have received a certificate of the Required
Representative(s) and, in the case that the Required Representative(s) are not
then the Other Debt Representatives, the Other Debt Representatives, in the
case of clause (ii) above, to the effect that, upon receipt of the Corporate
Trustee's written consent, this Section 9.01(a) has been complied with and an
instruction letter requesting the Corporate Trustee and Individual Trustee to
execute such supplemental agreement.
(b) Notwithstanding the provisions of paragraph (a), (x) so long as the
Obligations of the Borrower with respect to the Banc of America Secured Option
shall remain outstanding, the approval of Banc of America Securities LLC shall
be required for any amendment, waiver or consent of the type set forth in
paragraph (a) that adversely affects the rights of Banc of America Securities
LLC in a way different from the other Secured Holders and (y) the Collateral
Trustees and the Grantors may, at any time and from time to time, without the
consent of the Agent and any other Representative or any Secured Holders, enter
into additional Shared Collateral Documents or one or more agreements
supplemental hereto or to any Shared Collateral Document, in form satisfactory
to the Collateral Trustees,
(i) to add to the covenants of the Grantors for the benefit of the
Representatives or any Secured Holder, or to surrender any right or power
herein conferred upon the Grantors; or
(ii) to mortgage, pledge or grant a security interest in favor of the
Collateral Trustees as additional security for the Secured Obligations any
property or assets which are required to be mortgaged or pledged, or in
which a security interest is required to be granted, to the Collateral
Trustees pursuant to any Shared Collateral Document or otherwise.
SECTION 9.02. Additional Actions of Representatives. Whether or not there
shall be a Collateral Trust Agreement Default, the Collateral Trustees shall
comply and shall be fully protected in complying with any reasonable request of
(a) the Required Representative(s), to take or refrain from taking certain
actions with respect to the Collateral or the Representatives,
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and (b) more than 50% of the Secured Holders represented by any Representative
which has requested that an account be opened pursuant to Section 5.02, to take
or refrain from taking certain actions with respect to such account, provided,
in each case, that the Collateral Trustees shall not take or refrain from
taking such actions if to do so would violate applicable law or the terms of
this Agreement, the other Shared Collateral Documents or the Applicable
Agreements or if the Collateral Trustees shall not be indemnified as provided
in Section 6.06(b).
SECTION 9.03. Notices. All notices, requests, demands and other
communications provided for or permitted hereunder shall, unless otherwise
stated herein, be in writing (including telex and telecopy communications) and
shall be sent by mail (by registered or certified mail, return receipt
requested), overnight prepaid courier, telex, telecopier or hand delivery:
(a) If to the Grantors, to their addresses specified in the Credit
Agreement or in any Shared Collateral Document;
(b) If to the Corporate Trustee, at ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Corporate Trust Division, or
at such other address as shall be designated by it in a written notice to
the Grantors and each Representative, with a copy to the Individual
Trustee, at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: Corporate Trust Division, or at such other address as
shall be designated by him in a written notice to the Grantors and each
Representative; provided that failure to send a copy of any notice to the
Individual Trustee shall not render any notice to the Collateral Trustees
ineffective; and
(c) If to any Representative, to it at the address specified from
time to time in the list provided by the Grantors to the Collateral
Trustees pursuant to Section 6.02 with copies to whomever (other than the
Grantors) is specified by the Grantors pursuant to Section 6.02 as a
Person to whom notice must be sent under the Secured Agreements, provided
that in the case that no address is known for a Representative, notice
shall be given to it in the manner specified by the related Secured
Agreement, and, in the absence of any such specified means of giving
notice, by such notice in the national edition of The Wall Street Journal
or as the Collateral Trustees shall determine to be reasonable. For
purposes of notice by publication, one notice is sufficient and shall be
deemed made on the date of its publication.
All such notices, requests, demands and communications shall be deemed to have
been duly given or made, (i) when delivered by hand, (ii) five Business Days
after being deposited in the mail, postage prepaid, (iii) the next Business Day
if delivered by an overnight prepaid courier, (iv) when telexed with answerback
received, (v) when telecopied or (vi) when published in The Wall Street Journal
or such other publication; provided, however, that any notice, request, demand
or other communication to (1) the Collateral Trustees or (2) any Representative
under Article V or Article VIII shall not be effective until received by the
Corporate Trustee or such Representative, as the case may be, and, provided,
further, that any notice to the Collateral Trustees from any Grantor shall be
signed by an Authorized Officer, unless otherwise specifically set forth
herein.
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SECTION 9.04. Headings. Section, subsection and other headings used in
this Agreement are for convenience only and shall not affect the construction
of this Agreement.
SECTION 9.05. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall not invalidate 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.
SECTION 9.06. Treatment of Payee or Indorsee by Trustees. (a) The
Collateral Trustees may treat the registered Secured Holder of any registered
note, and the payee or indorsee of any note or debenture which is not
registered, as the absolute owner thereof for all purposes hereunder and shall
not be affected by any notice to the contrary, whether such promissory note or
debenture shall be past due or not.
(b) Any person, firm, corporation or other entity which shall be
designated as the duly authorized representative of one or more Representatives
to act as such in connection with any matters pertaining to this Agreement or
any other Shared Collateral Document or the Collateral shall present to the
Collateral Trustees such documents, including, without limitation, opinions of
counsel, as the Collateral Trustees may reasonably require, in order to
demonstrate to the Collateral Trustees the authority of such person, firm,
corporation or other entity to act as the representative of such
Representatives.
SECTION 9.07. Dealings with the Grantors. Upon any application or demand
by the Grantors to the Collateral Trustees to take or permit any action under
any of the provisions of this Agreement, each Grantor shall (unless otherwise
waived by the Collateral Trustees in writing) furnish to the Collateral
Trustees a certificate signed by an Authorized Officer stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with, except that in the case of any such
application or demand as to which the furnishing of such documents is
specifically required by any provision of this Agreement relating to such
particular application or demand, no additional certificate need be furnished.
SECTION 9.08. Claims. This Agreement is made for the benefit of the
Representatives on behalf of the Secured Holders, and the Representatives may
from time to time enforce their rights as explicit beneficiaries hereunder
pursuant to the terms and conditions of this Agreement and the other Shared
Collateral Documents.
SECTION 9.09. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of each of the parties hereto and shall inure to the
benefit of the Representatives on behalf of the Secured Holders and their
respective successors and assigns and nothing herein or in any other Shared
Collateral Document is intended or shall be construed to give any other Person
any right, remedy or claim under, to or in respect of this Agreement, any other
Shared Collateral Document, the Collateral, the Collateral Account or the
Collateral Trust Estate or any part thereof.
SECTION 9.10. Governing Law. The provisions of this Agreement creating a
trust for the benefit of the Representatives on behalf of the Secured Holders
and setting forth the
35
rights, duties, obligations and responsibilities of the Collateral Trustees
hereunder shall be governed by and construed in accordance with the laws of the
State of Delaware, so long as Wilmington Trust Company shall serve as Corporate
Trustee hereunder. In all other respects, including, without limitation, all
matters governed by the Uniform Commercial Code, and if Wilmington Trust
Company shall cease to serve as Corporate Trustee hereunder, this Agreement
shall be governed by and construed in accordance with the laws of the State of
New York, except as otherwise required by mandatory provisions of law.
SECTION 9.11. Effectiveness. This Agreement shall become effective on the
execution and delivery hereof and shall remain in effect so long as the
Collateral Trustees shall have any obligations hereunder.
SECTION 9.12. Reexecution of Agreement. This Agreement shall be reexecuted
at any time and from time to time, at the request of the Required
Representative(s), with such changes in the form hereof (including, without
limitation, changes on the cover page and adding supplemental signatures and
notary statements) as may be necessary to comply with the filing or recording
requirements of any jurisdiction where this Agreement is to be filed.
SECTION 9.13. Effect on Credit Agreements. Nothing in this Agreement shall
operate or be deemed to prevent any amendment, modification or waiver of the
Credit Agreement or other Credit Agreement Document by the parties thereto in
accordance with the terms thereof.
SECTION 9.14. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be duly executed by their respective officers
thereunto duly authorized as of the day and year first above written.
Corporate Trustee: WILMINGTON TRUST COMPANY, not in its
individual capacity, but solely as
Corporate Trustee
By:
----------------------------------
Title:
Individual Trustee:
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, not in his individual
capacity, but solely as Individual
Trustee
Grantors: THE AES CORPORATION,
a Delaware corporation
By:
----------------------------------
Title:
AES INTERNATIONAL HOLDINGS II, LTD.,
a British Virgin Islands company
By:
----------------------------------
Title:
ACKNOWLEDGED AND AGREED ON
THE DATE HEREOF BY:
CITICORP USA, INC.,
as Administrative Agent
By:
----------------------------------
Title:
▇▇▇▇▇ FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, as Exchange Note Trustee
By:
----------------------------------
Title:
BANKBOSTON, N.A., NASSAU BRANCH,
as Sul Agent
By:
----------------------------------
Title:
FLEET NATIONAL BANK,
as Lake Worth LOC Bank
By:
----------------------------------
Title:
