Exhibit 10.26.5
GENERAL SECURITY AGREEMENT
of
O'BRIEN (PHILADELPHIA) COGENERATION INC.
in favor of
MEESPIERSON CAPITAL CORP.
December 17, 1997
GENERAL SECURITY AGREEMENT
THIS GENERAL SECURITY AGREEMENT ("this Agreement") dated as
of December 17, 1997, is entered into by and between O'BRIEN
(PHILADELPHIA) COGENERATION INC., a corporation incorporated under the
laws of the State of Delaware, having offices at 1221 Nicollet Mall,
Suite 610, Minneapolis, Minnesota 55403 (the "Grantor"), and
MEESPIERSON CAPITAL CORP., a corporation incorporated under the laws of
the State of Delaware, with offices at 445 Park Avenue, New York, New
York (the "Security Trustee").
W I T N E S S E T H T H A T :
WHEREAS:
A. By a Credit Agreement dated as of December 17, 1997 (the
"Credit Agreement") made among the Security Trustee, as Agent and
Security Trustee, the banks and financial institutions whose names and
addresses are set out in Schedule 1 thereto (the "Lenders"), and NRG
Generating (U.S.) Inc. (the "Borrower"), the Lenders, subject to the
terms thereof, have agreed to make advances to the Borrower of up to
Thirty Million United States Dollars (US$30,000,000) outstanding at any
time (the "Credit Facility");
B. The Borrower is an affiliate of the Grantor, and the
financial accommodations made to the Borrower under the Credit Facility
will be of benefit to the Grantor; and
C. Pursuant to the Credit Agreement it is a condition
precedent to the availability of the Credit Facility that the Grantor
execute and deliver to the Security Trustee this Agreement and grant
the security interests contemplated hereby in order to create in favor
of the Security Trustee a valid and perfected security interest, as
that term is defined in the Uniform Commercial Code of New York (the
"Code"), in the Collateral (as such term is hereinafter defined), as
security for the payment and performance of all the obligations of the
Borrower under and in connection with the Credit Agreement and the Note
(as such term is defined in the Credit Agreement) now or hereafter
existing whether for principal, interest, fees, expenses or otherwise
and all secured obligations of the Grantor now or hereafter existing
under this Agreement (all such obligations of the Grantor are
hereinafter collectively referred to as the "Secured Obligations").
NOW, THEREFORE, in consideration of the premises, the parties
hereby agree as follows:
1. Definitions. All capitalized terms not otherwise defined
herein shall have the meanings ascribed to them in the Credit
Agreement.
2. Grant of Security. The Grantor, as legal and beneficial
owner, as security for the Secured Obligations, hereby assigns,
pledges, transfers and sets over unto the Security Trustee and its
successors and assigns, and hereby grants to the Security Trustee a
security interest in, all of the Grantor's right, title and interest in
and to the following property (hereinafter referred to as the
"Collateral"):
(a) Any and all equipment (as defined in the Code) of the
Grantor, or in which it has rights, whether now owned or hereafter
acquired, and all machinery, tools, office equipment, furniture,
furnishings, fixtures, rolling stock, dies and tools used or useful in
Grantor's business, structures, leasehold improvements, installations,
equipment and appurtenances hereafter constructed, drilled or placed
and any and all goods, equipment and tangible property held or used by
the Grantor, supplies and materials on hand, and all personal property
of every kind, nature and description, whether affixed to land or
imbedded therein or otherwise, of the Grantor together with all present
and future improvements or products of, accessions, attachments and
other additions to and substitutes and replacements for, all or any
part of the foregoing (all of the foregoing types or items of property
and interests described in this paragraph are hereinafter collectively
referred to in this Agreement as the "Personal Property");
(b) Any and all general intangibles (as defined in the Code) of the
Grantor, whether now existing or hereafter acquired or arising,
including, without limitation, all contracts, Energy Service
Agreements, leases, power purchase agreements, steam sale agreements
and any other contractual rights (including any rights to distributions
under any partnership agreements), partnership interests, copyrights,
royalties, licenses, sublicenses, trademarks, trade names, service
marks, patent and proprietary rights, blueprints, drawings, designs,
trade secrets, plans, diagrams, schematics, assembly and display
materials relating thereto and all customer lists, including, without
limitation, all present and future rights, titles, interests and
estates now owned or hereafter acquired by the Grantor (including,
without limitation, all rights to receive payments) under or by virtue
of all agreements, or under or by virtue of all contracts ; provided,
however, any of the foregoing (including the Permits but excluding the
Energy Services Agreements which shall under all circumstances be
subject to the pledge and assignment hereunder and as to which Grantor
has obtained all necessary consents to permit such pledge and
assignment) which by their terms would become void, voidable,
terminable or revocable or would constitute a breach or default
thereunder if pledged or assigned hereunder or if a security interest
therein were granted hereunder are expressly excepted and excluded from
the lien and terms of this Agreement to the extent necessary to avoid
such voidness,
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violability, terminability or revocability; provided further, however,
the Grantor will use all reasonable efforts to obtain all consents
necessary to permit such pledge, assignment and security interest (all
of the foregoing rights, titles, interests and estates referred to or
described in this paragraph are hereinafter collectively referred to in
this Agreement as the "Intangibles Collateral"). As used herein,
"Permits" shall mean any authorizations, consents, approvals, waivers,
exemptions, variances, registrations, leases, tariffs, certifications,
franchises, permissions, permits and licenses now or hereafter of, and
filings and declarations now or hereafter with, and rulings now or
hereafter by, any Governmental Authority (including, without
limitation, the QF Certificate), including those with respect to the
reconstruction, repair, alteration, addition, improvement, replacement,
use, operation or management of the Philadelphia Cogeneration Project
(including, without limitation, all Governmental Approvals now or
hereafter held in the name or for the benefit of the Grantor);
(c) Any and all present and future accounts (as defined in
the Code) (including, but not limited to, all open accounts, accounts
receivable and rights to payment of money, hire due or to become due
and moneys arising under or pursuant to the Intangibles Collateral or
to any other agreements, documents or instruments relating to any
property whether or not owned or leased by the Grantor), chattel paper,
documents, instruments, cash and noncash proceeds, all returned or
repossessed goods and all books, records, computer tapes, programs and
ledger books arising therefrom or relating thereto and other rights
arising from or by virtue of, or from the voluntary or involuntary sale
or other disposition of, or collections with respect to, or insurance
proceeds payable with respect to, or proceeds payable by virtue of
warranty or other claims and causes of action (i) for money, loss or
damages arising out of or in any way connected with the use, operation
or management of any property of the Grantor or (ii) against
manufacturers of or claims against any other person or entity with
respect to all or any part of the Personal Property and other property
whether or not owned or leased by the Grantor (all of the foregoing
types and items of property and interests described in this paragraph
are hereinafter collectively referred to in this Agreement as the
"Accounts");
(d) Any and all inventory (as defined in the Code) of the
Grantor, or in which it has rights, whether now owned or hereafter
acquired, wherever located, including, without limitation, all goods
(as defined in the Code) of the Grantor held for sale or lease or
furnished or to be furnished under contracts of service, all goods held
for display or demonstration, goods on lease or consignment, recess,
finished goods and supplies used or consumed in the Grantor's business,
together with all documents, documents of title, warehouse receipts,
bills of lading or orders for the delivery of all, or any portion, of
the foregoing (all of the foregoing types and items of property and
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interests described in this paragraph are hereinafter collectively
referred to in this Agreement as the "Inventory Collateral");
(e) Any and all other interests of every kind and character
which the Grantor now has or at any time hereafter acquires in and to
any property whether or not owned or leased by the Grantor, any
interest of the Grantor in the goods or inventory produced therefrom or
stored thereon, the Personal Property, the Intangibles Collateral, the
Accounts and the Inventory Collateral and all property, real, personal
or mixed, tangible or intangible, which is used or useful in connection
with any property whether or not owned or leased by the Grantor, any
interest of the Grantor in the goods or inventory produced therefrom or
stored thereon, the Personal Property, the Intangibles Collateral, the
Accounts and the Inventory Collateral and the proceeds and products of
all of the foregoing and all moneys of any kind whatsoever arising from
or in connection with the Grantor's ownership, sale or lease of the
interest of the Grantor in the goods or inventory produced therefrom or
stored thereon, the Personal Property, the Intangibles Collateral, the
Accounts and the Inventory Collateral, including without limitation,
any and all money and claims for moneys due and to become due to the
Grantor with respect to the actual constructive, agreed, arranged or
compromised total loss, or requisition, purchase, seizure, or taking in
any manner of title or ownership of any property of the Grantor, and
all claims for damage or compensation with respect thereto, and any
indemnity, warranty or guaranty otherwise payable by reason of loss or
damage to, or otherwise with respect to, any interest of the Grantor in
the goods or inventory produced therefrom or stored thereon, the
Personal Property, the Intangibles Collateral, the Accounts and the
Inventory Collateral, whether now owned or hereafter acquired; and
(f) Any and all proceeds of, and all other profits, rentals
or receipts, in whatever form, arising from the collection, sale,
lease, exchange, assignment, licensing or other disposition of, or
realization upon, the Personal Property, the Intangibles Collateral,
the Accounts and the Inventory Collateral, including without limitation
(i) all claims of the Grantor against third parties for loss of, damage
to or destruction of, or of proceeds payable under, or unearned
premiums with respect to policies of insurance in respect of, any of
the Personal Property, the Intangibles Collateral, the Accounts or the
Inventory Collateral; (ii) any condemnation payments with respect to
any of the Personal Property, the Intangibles Collateral, the Accounts
or the Inventory Collateral, in each case whether now existing or
hereafter arising; and (iii) any and all other amounts from time to
time paid or payable under or in connection with any of the Personal
Property, the Intangibles Collateral, the Accounts or the Inventory
Collateral, including, without limitation, all other rights, claims and
benefits of the Grantor against any person arising out of, relating to
or in connection with, any of the Personal Property, the Intangibles
Collateral, the Accounts or the Inventory Collateral.]
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The security interest of the Security Trustee contained
herein shall cover, and shall include a continuing general assignment
in favor of the Security Trustee in, any and all documents, contracts,
liens and security instruments, guarantees, books and records
evidencing, securing or relating to the Collateral and the insurance to
be secured to cover same in accordance with Section 5 hereof.
3. Security for Secured Obligations. This Agreement secures
the payment and performance of all of the Secured Obligations.
4. Representations and Warranties. The Grantor represents
and warrants as follows:
(a) The Grantor owns the Collateral free and clear of any
lien, security interest, charge or encumbrance except for any Permitted
Liens. Except with respect to Permitted Liens, no effective financing
statement or other instrument similar in effect covering all or any
part of the Collateral is on file in any recording office.
(b) Appropriate financing statements and mortgages have been
or are concurrently herewith being filed at all governmental offices in
each jurisdiction where such filing is necessary to perfect the
security interest intended to be covered hereby and such security
interest shall, upon such filing, constitute a perfected security
interest in the Collateral in favor of the Security Trustee (to the
extent that such security interest can be perfected in the Collateral
by filing a financing statement or mortgage under the Code or
applicable state or foreign law) which are enforceable as such against
all creditors of and purchasers from the Grantor (other than purchasers
who take free of such liens, encumbrances or security interests under
the Code) and against any owner or purchaser of the real property where
any of the equipment is located and any present or future creditor
obtaining any lien, encumbrance or security interest on such real
property. All other filings and other actions requested by the
Security Trustee to perfect and protect the security interest granted
herein have been duly made or taken.
(c) No authorization, approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
(other than as contemplated by sub-clause (c) immediately preceding
this sub-clause) is required either (i) for the grant by the Grantor of
the security interest granted hereby or for the execution, delivery or
performance of this Agreement by the Grantor or (ii) for the perfection
of or the exercise by the Security Trustee of its right and remedies
hereunder.
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(d) All material agreements and rights constituting the
Collateral (including, but not limited to the Intangibles Collateral)
are valid and subsisting and are in full force and effect; and all
rentals, royalties and other material amounts due and payable by the
Grantor in respect thereof (and, to Grantor's knowledge, all rentals,
royalties and other material amounts due and payable by third parties
in respect thereof) have been paid or provision for such payment
satisfactory to the Security Trustee has been made; all of Grantor's
obligations in respect thereof have been timely met; and all leases,
agreements and all other material obligations to lessors and others
attendant to the ownership of the Collateral have been timely met and
duly performed. Except to the extent incurred in the ordinary course
of business, the Accounts are free from any claim for credit, deduction
or allowance of any party obligated in respect thereof and free from
any defense, dispute, setoff or counterclaim and there is no extension
or indulgence with respect thereto.
5. Further Assurances. (a) The Grantor agrees that from
time to time, at the expense of the Grantor, the Grantor will promptly
execute and deliver all further instruments and documents, and take all
further action, that may be necessary or advisable, or that the
Security Trustee may reasonably request, in order to perfect and
protect any security interest granted or purported to be granted hereby
or to enable the Security Trustee to exercise and enforce its rights
and remedies hereunder with respect to the Collateral. Without
limiting the generality of the foregoing, the Grantor shall execute and
file such financing or continuation statements, or amendments thereto,
and such other instruments or notices, as may be necessary or
advisable, or as the Security Trustee may reasonably request, whether
in a jurisdiction where the Code has been adopted or any other
jurisdiction, in order to perfect and preserve the security interests
granted or purported to be granted hereby.
(b) The Grantor hereby authorizes the Security Trustee to
file one or more financing or continuation statements, and amendments
thereto, relative to all or any part of the Collateral without the
signature of the Grantor where permitted by law. In the event that the
Security Trustee files any such financing statements or renewals
without the signature of the Grantor, it shall provide the Grantor with
notice thereof as soon as practicable after such filing.
(c) The Grantor will furnish to the Security Trustee from
time to time as the Security Trustee may reasonably request statements
and schedules further identifying and describing the Collateral and
such other reports in connection therewith, all in reasonable detail.
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(d) Upon reasonable notice without materially interfering
with the ordinary course or conduct of the Grantor's business, the
Security Trustee shall at all times have full and free access during
normal business hours to all the books, correspondence and records of
the Grantor, and the Security Trustee or its representatives may
examine the same, take extracts therefrom and make photocopies thereof,
and the Grantor agrees to render to the Security Trustee, at the
Grantor's cost and expense, such clerical and other assistance as may
be reasonably requested with regard thereto. The Security Trustee and
its representatives shall at all times, upon reasonable notice, without
materially interfering with the ordinary course or conduct of the
Grantor's business, also have the right to enter into and upon any
premises where any of the Collateral is located for the purpose of
inspecting the same, observing its use or otherwise protecting its
interests therein.
(e) The Grantor will comply with all requirements of law
applicable to the Collateral or any part thereof other than those
requirements with which the failure to comply would not have a material
adverse effect on the existence, condition or value of the Collateral
or the security interests granted hereunder; provided, however, that
the Grantor may contest any requirement of law in any reasonable manner
which shall not, in the reasonable opinion of the Security Trustee,
materially adversely affect the Security Trustee's rights or the
priority of their security interests in the Collateral.
(f) Without thirty (30) days' prior written notice to the
Security Trustee, the Grantor shall not (i) change its chief executive
office or principal place of business, (ii) change the location at
which it maintains its records relating to the Intangibles Collateral
or Accounts, and (iii) except as permitted under the Credit Agreement,
remove its Personal Property from any of the counties in which such
Personal Property is presently located (other than temporary removals
of Personal Property which are in the ordinary course of Grantor's
business). Grantor shall furnish to the Security Trustee from time to
time, as the Security Trustee may reasonably request, reports
identifying the locations where the Collateral is located.
(g) The Grantor shall not change its corporate name,
identity or corporate structure, nor carry on business under any name
other than its corporate name, unless (i) it has given to the Security
Trustee not less than thirty days prior written notice of its intention
to do so, specifying such new corporate name, identity or corporate
structure, and providing such other information in connection therewith
as the Security Trustee may reasonably request, and (ii) with respect
to such new corporate name, identity or corporate structure, it shall
have taken all action, requested by the Security Trustee in its
reasonable discretion, to maintain the security interest of the
Security
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Trustee in the Collateral intended to be granted hereby at all times
fully perfected and in full force and effect.
(h) The Grantor shall pay promptly, or cause to be paid
promptly, when due all property and other material taxes, assessments
and governmental charges or levies imposed upon, and all claims
(including claims for labor, materials and supplies) against, the
Collateral, except to the extent the validity thereof is being
contested in good faith and adequate reserves have been maintained
therefor.
(i) The Grantor will maintain all Collateral necessary in
the Grantor's business in good operating condition, ordinary wear and
tear and immaterial impairments of value and damage by the elements
excepted, and will provide maintenance, service and repairs necessary
for such purpose.
(j) The Grantor shall, within ten days of acquiring an
ownership interest in any Collateral having a value in excess of Twenty-
Five Thousand Dollars ($25,000) on which a security interest under the
Code can only be perfected by appropriate notations on the certificate
of title relating to such Collateral, deliver to the Security Trustee
any and all certificates of title, applications for title or similar
evidence of ownership of such Collateral and shall cause the Security
Trustee to be named as lienholder on any such certificate of title or
other evidence of ownership.
(k) The Grantor will, promptly upon request, provide to the
Security Trustee all information and evidence it may reasonably request
concerning the Collateral, and in particular the Accounts, to enable
the Security Trustee to enforce the provisions of this Agreement.
6. Security Trustee Appointed Attorney-in-Fact. The Grantor
hereby irrevocably appoints the Security Trustee as the Grantor's
attorney-in-fact, with full authority in the name, place and stead of
the Grantor, from time to time in the Security Trustee's discretion,
should an Event of Default (as such term is defined in the Credit
Agreement) have occurred and be continuing to take any action and to
execute any document which the Security Trustee may deem necessary or
advisable to accomplish the purposes of this Agreement, including,
without limitation:
(i) to ask, demand, collect, sue for, recover,
compound, receive and give acquittance and receipts for
moneys due and to become due under or in respect of any
of the Collateral,
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(ii) to receive, endorse, and collect any drafts or
other instruments, documents and chattel paper in
connection with clause (i) above, and
(iii) to file any claims or take any action or
institute any proceedings which the Security Trustee may
deem necessary or advisable for the recovery of any of
the Collateral or otherwise to enforce the rights of the
Security Trustee with respect thereto created by this
Agreement.
7. Concerning Account Debtors. (a) If the Security Trustee
so directs at any time after the occurrence and during the continuation
of an Event of Default, the Grantor agrees (i) to cause all payments on
account of the Accounts to be made directly to the Security Trustee and
(ii) that the Security Trustee may, at its option, directly notify the
obligors with respect to any of the Accounts to make such payments.
The Grantor agrees to be bound by any commercially reasonable
collection, compromise, forgiveness, extension or other action taken by
the Security Trustee with respect to the Accounts. Without notice to
or assent by the Grantor, the Security Trustee shall apply any or all
amounts then or thereafter deposited with it in the manner provided in
Section 11 of this Agreement. The costs and expenses (including
reasonable attorneys' fees) of collection, whether incurred by the
Grantor or the Security Trustee, shall be borne by the Grantor.
(b) The Grantor shall endeavor to cause to be collected from
the account debtor named in each of its Accounts, as and when due
(including, without limitation, amounts which are delinquent, such
amounts to be collected in accordance with generally accepted
collection procedures in accordance with all applicable laws), any and
all amounts owing under or on account of such Account, and apply
forthwith upon receipt thereof of all such amounts as are so collected
to the outstanding balance of such Account, except that, unless an
Event of Default shall have occurred and be continuing, the Grantor may
allow in the ordinary course of business as adjustments to amounts
owing under its Accounts (i) an extension or renewal of the time or
times of payment or settlement for less than the total unpaid balance
in the ordinary course of business, consistent with the Grantor's
existing policies with respect thereto and which the Grantor finds
appropriate at the time in accordance with sound business judgment, and
(ii) a refund or credit due as a result of returned or damaged
merchandise or improperly performed services. The costs and expenses
(including, without limitation, reasonable attorneys' fees) of
collection, whether incurred by the Grantor or the Security Trustee,
shall be borne by the Grantor.
8. Instruments. If any of the Accounts become evidenced by
an instrument, chattel paper or letter of credit (each defined in the
Code), the Grantor, upon notice from the Security Trustee and provided
an Event of Default has occurred and is continuing,
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shall promptly, and in any event within ten days, notify the Security
Trustee thereof, and upon request by the Security Trustee promptly
deliver such instrument, chattel paper or letter of credit as further
security under this Agreement.
9. Security Trustee May Perform. If the Grantor fails to
perform any agreement contained herein, the Security Trustee may itself
perform, or cause to be performed, such agreement, and the expenses of
the Security Trustee incurred in connection therewith shall be payable
by the Grantor.
10. The Security Trustee's Duties. The powers conferred on
the Security Trustee hereunder are solely to protect its interest in
the Collateral and shall not impose any duty upon the Security Trustee
to exercise any such powers. Except for the safe custody of any of the
Collateral which, from time to time, may come into its possession and
the accounting for moneys actually received by it hereunder, the
Security Trustee shall have no duty as to the Collateral or as to the
taking of any necessary steps to preserve rights against prior parties
or any other rights pertaining to the Collateral.
11. Remedies. The security constituted by this Agreement
shall be enforceable if an Event of Default shall have occurred and be
continuing:
(a) The Security Trustee may exercise, in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party on default under the Code (whether or not the Code shall
be applied by the court in the jurisdiction in which enforcement of the
security interest contained herein is sought) and also may (i) require
the Grantor to, and the Grantor hereby agrees that it will at its
expense and upon request of the Security Trustee forthwith, assemble
all or any part of the Collateral as directed by the Security Trustee
and make it available to the Security Trustee, at a place to be
designated by the Security Trustee which is reasonably convenient to
both parties, and (ii) without notice, except as specified below, sell
the Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Security Trustee's offices or elsewhere,
for cash, and at such price or prices and upon such other terms as the
Security Trustee may deem commercially reasonable. The Security
Trustee shall give the Grantor at least ten days' notice of the time
and place of any public sale. The Grantor agrees that ten days' notice
of any such sale is commercially reasonable notification. The Security
Trustee shall not be obligated to make any sale of the Collateral
regardless of notice of sale having been given. The Security Trustee
may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was
so adjourned.
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(b) All cash proceeds received by the Security Trustee in
respect of any sale of, or other realization upon, all or any part of
the Collateral shall be applied (after payment of any amounts payable
to the Security Trustee pursuant to Section 13 of this Agreement) in
whole or in part by the Security Trustee as set forth in Section 9 of
the Credit Agreement.
12. Non-Interference with Remedies; Specific Performance.
(a) The Grantor agrees that following the occurrence and during the
continuance of an Event of Default it will not at any time pledge,
claim or take the benefit of any appraisal, valuation, stay, extension,
moratorium or redemption law now or hereafter in force in order to
prevent or delay the enforcement of this Agreement, or the absolute
sale of the whole or any part of the Collateral or the possession
thereof by any purchaser at any sale hereunder, and the Grantor waives
the benefit of all such laws to the extent it lawfully may do so. The
Grantor agrees it will not interfere with any right, power or remedy of
the Security Trustee provided for in this Agreement now or hereafter
existing at law or in equity or by statute or otherwise, or with the
exercise or beginning of the exercise by the Security Trustee of any
one or more of such rights, powers or remedies.
(b) The Grantor agrees that a breach of any of the
agreements or covenants contained in this Agreement will cause
irreparable injury to the Security Trustee, that the Security Trustee
has no adequate remedy at law in respect of such breach and, as a
consequence, agrees that each and every agreement and covenant
contained in this Agreement shall be specifically enforceable against
the Grantor, and the Grantor hereby waives and agrees not to assert any
defenses against an action for specific performance of such agreements
or covenants except for a defense that the Secured Obligations are not
then due and payable in accordance with the agreements and instruments
governing and evidencing such Secured Obligations.
13. Indemnity, Expenses and Interest. (a) The Grantor
shall on demand of the Security Trustee pay to the Security Trustee (on
a full indemnity basis) all costs, charges, losses, liabilities and
expenses expended, paid or incurred by the Security Trustee (whether
before or after this Agreement becomes enforceable), including any tax
thereon and reasonable professional fees including attorneys' fees, in
connection with any breach of the covenants or undertakings herein or
the exercise of any rights exercisable under it or the recovery of any
of the Secured Obligations by the Security Trustee, including, without
limitation, any remuneration and other sums at any time payable to the
Security Trustee and all costs, charges, losses, liabilities and
expenses connected with the protection, realization, enforcement or
release of any provision of this Agreement, except to the extent the
same results from the Security Trustee's gross negligence or willful
misconduct.
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(b) The Grantor shall after demand by the Security Trustee
pay to the Security Trustee interest at a rate per annum equal to the
Default Rate on all of the costs, charges, losses, liabilities and
expenses referred to this clause. So long as no Event of Default has
occurred and is continuing, such interest shall accrue and be payable
from the date on which the Grantor receives notice from the Security
Trustee, otherwise, such interest shall accrue and be payable from the
date such cost, charge, loss, liability or expense was incurred by the
Security Trustee.
14. Security Interest Absolute. All rights of the Security
Trustee and the security interest granted hereunder, and all Secured
Obligations, shall be absolute and unconditional, irrespective of:
(i) any lack of validity or enforceability of the
Credit Agreement or the Note, or any other agreement or
instrument relating thereto;
(ii) any change in the time, manner or place of payment
of, or in any other term of, all or any of the
obligations of the Grantor or any other person under or
in connection with the Credit Agreement or any other
amendment or waiver of or any consent to any departure
from the Credit Agreement, the Note or the terms of any
thereto; or
(iii) any other circumstances which might otherwise
constitute a defense available to, or a discharge of,
the Grantor in respect of the Secured Obligations or
this Agreement.
15. Amendments. No amendment or waiver of any provision of
this Agreement, nor consent to any departure therefrom by the Grantor,
shall be effective unless the same shall be in writing and signed by
the parties hereto, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which
given.
16. Successors and Assigns. Whenever in this Agreement
reference is made to any person, such reference shall be deemed to
include the successors and assigns of such person.
17. Notices. Every notice or other communication under this
Agreement shall be in writing and may be given by telex or telecopy as
follows:
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If to the Grantor:
O'Brien (Philadelphia) Cogeneration Inc.
1221 Nicollet Mall
Suite 610
Minneapolis, Minnesota 55403
Attention: Vice President-CFO
Telecopy No.: (612) 373-8833
with a copy to:
Troutman Sanders LLP
600 Peachtree Street, N.W.
Suite 5200
Atlanta, Georgia 30308-2216
Attention: M. Stuart Sutherland, Esq.
Telecopy No.: (404) 885-3900
If to the Security Trustee:
MeesPierson Capital Corporation
445 Park Avenue
New York, New York 10022
Attention: Hendrik Vroege
Telecopy No.: (212) 801-0420
or to such other address as either party shall from time to time
specify in writing to the other. Any notice sent by telex or telecopy
shall be confirmed by letter dispatched as soon as practicable
thereafter.
Every notice or other communication as shall, except so far
as otherwise expressly provided by this Agreement, be deemed to have
been received (provided it is received prior to 2 p.m. New York time;
otherwise it shall be deemed to have been received on the next
following Banking Day (as such term is defined in the Credit
Agreement)) in the case of a telex or telecopy at the time the
transmitting machine
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provides confirmation of dispatch thereof (provided further that if the
date of dispatch is not a Banking Day in the locality of the party to
whom such notice or demand is sent it shall be deemed to have been
received on the next following Banking Day in such locality) and, in
the case of a letter, at the time of receipt thereof.
18. Continuing Security Interest. This Agreement shall
create a continuing security interest in the Collateral and shall
(i) remain in full force and effect until payment in full of the
Secured Obligations, (ii) be binding upon the Grantor, its successors
and assigns, and (iii) inure to the benefit of the Security Trustee and
its respective successors, transferees and assigns. Upon the payment
in full of the Secured Obligations, the security interest granted
hereby shall terminate and all rights in and to the Collateral shall
revert to the Grantor. Upon any such termination, the Security Trustee
will, at the Grantor's expense, execute and deliver to the Grantor such
documents as the Grantor shall reasonably request to evidence such
termination.
19. Headings. In this Agreement, clause headings are
inserted for convenience of reference only and shall not be considered
in the interpretation of this Agreement.
20. Waiver of Jury Trial. IT IS MUTUALLY AGREED BY AND
BETWEEN THE PARTIES HERETO THAT EACH OF THEM HEREBY WAIVES TRAIL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER PARTY
HERETO AGAINST THE OTHER PARTY HERETO ON ANY MATTER WHATSOEVER ARISING
OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT AND ANY SECURITY
DOCUMENT TO WHICH THE GRANTOR OR THE ASSIGNEE MAY BE A PARTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
21. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
ANY REFERENCE TO CONFLICTS OF LAWS PRINCIPLES OF THAT STATE.
22. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be deemed to be duplicate
originals and which shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed by their respective officers thereunto duly authorized
on the day and year first above written.
O'BRIEN (PHILADELPHIA)
COGENERATION INC.
By: /s/ Timothy P. Hunstad
Name: Timothy P. Hunstad
Title: Vice President-CFO
MEESPIERSON CAPITAL CORP.
By: /s/ Hendrik J. Vroege
Name: Hendrik J. Vroege
Title: Vice President
By: /s/ John T. Connors
Name: John T. Connors
Title: Exec. V.P.
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