EXHIBIT 4.4
Execution Copy
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POWER PURCHASE AGREEMENT LETTER OF CREDIT
AND REIMBURSEMENT AGREEMENT
Dated as of March 1, 2000
among
AES RED OAK, L.L.C.,
as Company,
DRESDNER BANK AG,
acting through its New York Branch,
as the Issuing Bank, as a Bank and as Agent
and
THE BANKS PARTY HERETO
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830 MW (Net) Gas-Fired Combined Cycle Electric Generating Facility
Borough of Sayreville, Middlesex County, New Jersey
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.............................................................................................1
SECTION 1.1 DEFINITIONS..................................................................................1
SECTION 1.2 CONSTRUCTION.................................................................................6
ARTICLE II PPA LETTER OF CREDIT...................................................................................6
SECTION 2.1 COMMITMENTS..................................................................................6
SECTION 2.2 AMOUNT AND TERM OF PPA LETTER OF CREDIT......................................................6
SECTION 2.3 PARTICIPATION IN PPA LETTER OF CREDIT........................................................7
SECTION 2.4 DRAWING AND REIMBURSEMENT....................................................................7
SECTION 2.5 FEES.........................................................................................8
SECTION 2.6 INTEREST.....................................................................................8
SECTION 2.7 REPAYMENT...................................................................................11
SECTION 2.8 PREPAYMENTS.................................................................................11
SECTION 2.9 SECURITY....................................................................................11
SECTION 2.10 PAYMENTS....................................................................................11
SECTION 2.11 COMPUTATION OF INTEREST AND FEES............................................................12
SECTION 2.12 PAYMENTS ON NON-BUSINESS DAYS...............................................................12
SECTION 2.13 SHARING OF PAYMENTS, ETC....................................................................12
SECTION 2.14 EVIDENCE OF DEBT............................................................................13
SECTION 2.15 INCREASED COSTS AND REDUCED RETURNS.........................................................13
SECTION 2.16 CAPITAL ADEQUACY............................................................................15
SECTION 2.17 TAXES.......................................................................................15
SECTION 2.18 ILLEGALITY..................................................................................17
SECTION 2.19 ASSIGNMENTS BY BANKS........................................................................18
SECTION 2.20 REDUCTION IN COMMITMENTS/REIMBURSEMENTS.....................................................19
SECTION 2.21 RIGHT OF SET-OFF............................................................................19
ARTICLE III CONDITIONS PRECEDENT.................................................................................19
SECTION 3.1 CONDITIONS PRECEDENT TO THE CLOSING DATE....................................................19
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................20
SECTION 4.1 REPRESENTATIONS AND WARRANTIES OF COMPANY...................................................20
SECTION 4.2 REPRESENTATIONS AND WARRANTIES OF THE ISSUING BANK..........................................20
ARTICLE V COVENANTS..............................................................................................21
SECTION 5.1 COVENANTS...................................................................................21
ARTICLE VI DEFAULTS AND REMEDIES.................................................................................21
SECTION 6.1 EVENTS OF DEFAULT...........................................................................21
SECTION 6.2 REMEDIES....................................................................................21
SECTION 6.3 COLLATERALIZATION UPON ACCELERATION OF THE BONDS............................................22
ARTICLE VII CHARACTER OF OBLIGATIONS.............................................................................22
SECTION 7.1 OBLIGATIONS ABSOLUTE........................................................................22
SECTION 7.2 LIMITED LIABILITY OF AGENT AND BANKS........................................................23
ARTICLE VIII THE AGENT...........................................................................................24
SECTION 8.1 AUTHORIZATION AND ACTION....................................................................24
SECTION 8.2 AGENT'S RELIANCE, ETC.......................................................................24
SECTION 8.3 THE AGENT, THE ISSUING BANK AND AFFILIATES..................................................25
SECTION 8.4 BANK CREDIT DECISION........................................................................25
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SECTION 8.5 INDEMNIFICATION.............................................................................25
SECTION 8.6 SUCCESSOR AGENT.............................................................................26
SECTION 8.7 COLLATERAL..................................................................................26
ARTICLE IX MISCELLANEOUS.........................................................................................26
SECTION 9.1 AMENDMENTS, ETC.............................................................................26
SECTION 9.2 NOTICES, ETC................................................................................27
SECTION 9.3 NO WAIVER, REMEDIES.........................................................................27
SECTION 9.4 COSTS AND EXPENSES..........................................................................27
SECTION 9.5 APPLICATION OF MONEY........................................................................28
SECTION 9.6 SEVERABILITY................................................................................28
SECTION 9.7 NON-RECOURSE LIABILITY......................................................................28
SECTION 9.8 BINDING EFFECT..............................................................................29
SECTION 9.9 ASSIGNMENTS AND PARTICIPATIONS..............................................................29
SECTION 9.10 INDEMNIFICATION.............................................................................30
SECTION 9.11 GOVERNING LAW; SUBMISSION OF JURISDICTION; VENUE; WAIVER OF JURY TRIAL......................31
SECTION 9.12 HEADINGS....................................................................................33
SECTION 9.13 EXECUTION IN COUNTERPARTS...................................................................33
Exhibit A Form of PPA Letter of Credit
Exhibit B Form of PPA LOC Loan Promissory Note
Exhibit C Form of Assignment and Acceptance
Exhibit D Amortization Schedule
Schedule 1 Applicable Margin
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POWER PURCHASE AGREEMENT LETTER OF CREDIT
AND REIMBURSEMENT AGREEMENT
This POWER PURCHASE AGREEMENT Letter of Credit and Reimbursement Agreement,
dated as of March 1, 2000 (this "AGREEMENT"), is entered into by and among (1)
AES RED OAK, L.L.C., a Delaware limited liability company (the "COMPANY"); (2)
DRESDNER BANK AG, a banking corporation under the laws of the Republic of
Germany, acting through its New York Branch, as the Issuing Bank (the "ISSUING
BANK"); (3) DRESDNER BANK AG, a banking corporation under the laws of the
Republic of Germany, acting through its New York Branch, in its individual
capacity, together with each other bank that becomes a party hereto pursuant to
Section 2.19 or Section 9.9 (each, including the Issuing Bank, a "BANK" and
collectively, the "BANKS"); and (4) DRESDNER BANK AG, a banking corporation
under the laws of the Republic of Germany, acting through its New York Branch,
as agent for the Banks (in such capacity, together with its successors in such
capacity, the "AGENT").
WHEREAS, the Company is constructing and will own a gas-fired combined
cycle electric generating facility in the Borough of Sayreville, New Jersey,
with a net design capacity of approximately 830 megawatts and related property
and facilities;
WHEREAS, the Company intends to finance the construction and equipping of
the Facility primarily through the issuance of the Bonds, the net proceeds of
which shall be received by the Company and shall be used to pay project costs
related to the Facility;
WHEREAS, the Company has duly authorized the creation and issuance of the
Bonds pursuant to the Indenture; and
WHEREAS, the Company has requested that the Issuing Bank agree to issue and
the Banks participate in, and the Issuing Bank is willing to agree to issue and
the Banks are willing to participate in, the PPA Letter of Credit upon the terms
and conditions hereinafter set forth.
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS.
(a) Capitalized terms used but not otherwise defined herein shall have the
respective meanings ascribed to them in the Indenture.
(b) The following terms are used in this Agreement with the following
respective meanings:
"ADJUSTED BASE RATE" means the higher of (i) the Federal Funds Rate plus
.50% and (ii) the Reference Rate.
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"APPLICABLE MARGIN" means, in the case of the determination of the interest
rate on Base Rate Loans and Eurodollar Rate Loans, the margin applicable to Base
Rate Loans or Eurodollar Rate Loans, in each case as set forth under the
applicable heading and for the applicable rating category as set forth on
Schedule 1, and in the case of the determination of the letter of credit fee,
the amount set forth for the applicable rating category under "Letter of Credit
Fee" on Schedule 1.
"ASSIGNMENT AND ACCEPTANCE" means an Assignment and Acceptance entered into
by a Bank and another Person, substantially in the form of Exhibit C.
"BANK" has the meaning set forth in the preamble of this Agreement.
"BASE RATE LOAN" means a PPA LOC Loan, or a portion thereof, bearing
interest at a rate determined with reference to the Adjusted Base Rate.
"BUSINESS DAY" means a day (other than a Saturday or Sunday) on which banks
are open for business in New York, New York, and with respect to all notices and
determinations in connection with, advances of, continuations of, conversions
from and to, and payments of principal and interest on, Eurodollar Rate Loans,
any day that is also a day for trading by and between banks in U.S. dollar
deposits in the London interbank Eurodollar market.
"CLOSING DATE" means the date on which the conditions precedent set forth
in Section 3.1 have been fulfilled.
"COMMITMENT" of a Bank means (i) the amount set forth opposite such Bank's
name on the signature pages hereof, as such amount shall be adjusted in
accordance with the Stated Amount on the Commercial Operation Date or, if such
Bank has entered into one or more Assignments and Acceptances, set forth for
such Bank in the register maintained by the Agent for such purpose, as the same
may be reduced from time to time in accordance with the provisions of this
Agreement or (ii) as the context may require, the obligation of such Bank to
make loans in an aggregate amount of principal not exceeding such amount.
"COMMITMENTS" means all of the Commitments.
"COMPANY" has the meaning set forth in the preamble of this Agreement.
"CREDIT DOCUMENTS" means this Agreement, the Security Documents, the
Collateral Agency Agreement, the PPA LOC Loan Note and the PPA Letter of Credit.
"DEEMED PPA LOC LOANS" has the meaning set forth in Section 6.3.
"DEFAULT" means an event that with the giving of any required notice and/or
the lapse of any required time would constitute an Event of Default.
"DOLLARS" and "$" means freely transferable United States dollars.
"DRAWING" means a drawing under the PPA Letter of Credit.
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"EUROCURRENCY LIABILITIES" has the meaning set forth in Regulation D.
"EUROCURRENCY RESERVE PERIOD" has the meaning set forth in Section 2.15(b).
"EURODOLLAR RATE" means, for any Interest Period with respect to a
Eurodollar Rate Loan, the rate PER ANNUM equal to the average (rounded upwards,
if necessary, to the nearest 1/100 of 1%) of the offered rates which appear on
the Telerate page 3750, British Bankers Association Interest Settlement Rates
for deposits in Dollars (or such other system for the purpose of displaying
rates of leading reference banks in the London interbank market, as designated
by the Agent) as of 11:00 a.m. (London time) on the day two Business Days prior
to the first day of such Interest Period in an amount approximately equal to the
principal amount of the Eurodollar Rate Loan to which such Interest Period is to
apply and for a period of time comparable to such Interest Period.
"EURODOLLAR RATE LOAN" means a PPA LOC Loan, or a portion thereof, bearing
interest at a rate determined with reference to the Eurodollar Rate.
"EVENT OF DEFAULT" has the meaning set forth in Section 6.1.
"EXCLUDED TAXES" has the meaning set forth in Section 2.17(a).
"EXPIRATION DATE" means seven (7) years from the Closing Date; PROVIDED,
HOWEVER, (i) that the Expiration Date of the PPA Letter of Credit may be
extended as set forth in Section 2.2(a) whereupon the Expiration Date of the PPA
Letter of Credit shall be such extended Expiration Date and (ii) that if the
Company replaces the PPA Letter of Credit with substitute collateral in
accordance with the requirements of the Power Purchase Agreement, the Expiration
Date of the PPA Letter of Credit shall be the date upon which the PPA LOC
Provider receives notice of such replacement.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest rate PER
ANNUM equal for each day during such period to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three federal funds brokers of
recognized standing selected by it.
"INDEMNIFIED PARTY" has the meaning set forth in Section 9.10.
"INDENTURE" means the Trust Indenture dated as of the date hereof among the
Company, The Bank of New York, as Trustee, and The Bank of New York, as
Depository Bank.
"INTEREST PERIOD" means with respect to each Eurodollar Rate Loan, a period
commencing on the date specified in the applicable Notice of Interest Rate
Election and ending one, three or six calendar months thereafter, as the Company
may elect in the applicable Notice of Interest Rate Election; PROVIDED, that:
3
(a) any Interest Period which would otherwise end on a day which is not a
Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Business Day;
(b) any Interest Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month;
(c) no Interest Period shall be selected to be applicable to a PPA LOC Loan
or portion thereof if such Interest Period ends after the next scheduled
principal payment date pursuant to this Agreement and the PPA LOC Loan Note
unless, at the time of such selection, there are outstanding Base Rate Loans
and/or Eurodollar Rate Loans the Interest Period(s) applicable to which end on
or before such scheduled payment date which the Company reasonably determines
are in an aggregate principal amount at least equal to the amount of such next
scheduled principal payment; and
(d) no Interest Period shall end after the PPA LOC Loan Required Payment
Date.
"ISSUING BANK" has the meaning set forth in the preamble of this Agreement.
"LOAN OBLIGATIONS" means the Drawing and the principal of all PPA LOC Loans
(including but not limited to the Company's obligations in respect of amounts
not yet disbursed).
"NON-RECOURSE PARTY" has the meaning specified in Section 9.7.
"NOTICE DATE" has the meaning set forth in Section 2.2(a)(ii).
"NOTICE OF INTEREST RATE ELECTION" has the meaning set forth in Section
2.6(b).
"OBLIGATIONS" means all of the Loan Obligations and any and all other
obligations of the Company to the Issuing Bank, the Banks or the Agent under or
in connection with the Credit Documents whether for interest, fees, expenses,
indemnification or otherwise.
"PARTICIPANT" has the meaning set forth in Section 9.9(b).
"PERCENTAGE INTEREST" means, for each Bank, the fraction, expressed as a
percentage, where the numerator is the Commitment of such Bank and the
denominator is the aggregate of all the Commitments held by all the Banks, as
set forth on the signature page opposite the name and signature of each
respective Bank or if applicable, in Schedule 1 to any Assignment and
Acceptance.
"POST-DEFAULT RATE" means the rate otherwise applicable under Section
2.6(a) plus 2.0%.
"PPA LETTER OF CREDIT" means a letter of credit in favor of the Power
Purchaser substantially in the form of Exhibit A, issued or to be issued by the
Issuing Bank.
"PPA LOC LOAN" has the meaning set forth in Section 2.4.
"PPA LOC LOAN NOTE" has the meaning set forth in Section 2.14(a).
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"PPA LOC LOAN REQUIRED PAYMENT DATE" means, in respect of each PPA LOC
Loan, the date ten (10) years from the date such PPA LOC Loan is made by the
Banks pursuant to the terms of this Agreement, provided that the PPA LOC Loan
Required Payment Date in respect of any PPA LOC Loan made less than ten (10)
years prior to the Final Maturity Date, shall be the Final Maturity Date.
"PURCHASING BANK" has the meaning set forth in Section 9.9(a).
"QUARTERLY DATE" means each Bond Payment Date during the term of this
Agreement.
"REFERENCE RATE" means the variable rate of interest PER ANNUM officially
announced or published by the Agent from time to time as its "reference rate,"
such rate being set by the Agent as a general reference rate of interest, taking
into account such factors as the Agent may deem appropriate, it being understood
that many of the Agent's commercial or other loans are priced in relation to
such rate, that it is not necessarily the lowest or best rate actually charged
to any customer and that the Agent may make various commercial or other loans at
rates of interest having no relationship to such rate. For purposes of this
Agreement, each change in the Reference Rate shall be effective as of the
opening of business on the date announced as the effective date of the change in
such "reference rate."
"REGULATION D" means Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"REPLACEMENT BANK" has the meaning set forth in Section 2.19.
"REQUIRED BANKS" means, at any time, Banks (one of which shall be the
Agent) owed at least 66-2/3% of the sum of Loan Obligations then outstanding
and/or the Commitments; PROVIDED, HOWEVER, that, if and so long as there are
only two Banks, then "Required Banks" shall mean both of such Banks.
"STATED AMOUNT" means (i) $30,000,000 prior to the Commercial Operation
Date and (ii) on or after the Commercial Operation Date an amount equal to the
lesser of (a) $10,000,000 and (b) $30,000,000 less all amounts drawn under the
PPA Letter of Credit and not reimbursed hereunder prior to the Commercial
Operation Date.
"TAXES" means any and all present or future income, stamp, transfer,
turnover and other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings now or hereafter imposed, levied, collected, withheld or assessed
by any Governmental Authority, and any and all interest, penalties, claims or
other liabilities arising under or relating thereto, including those imposed on
any of the Banks or on payments to be made to or received by any of them from
the Company hereunder.
"TERMINATION NOTICE" has the meaning set forth in Section 2.2(b).
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SECTION 1.2 CONSTRUCTION.
In this Agreement, unless expressly specified to the contrary: the singular
includes the plural and the plural the singular; words importing any gender
include the other genders; references to statutes or regulations are to be
construed as including all statutory or regulatory provisions consolidating,
amending or replacing the statute or regulation referred to; references to
"writing" include printing, typing, lithography and other means of reproducing
words in a tangible, visible form, but shall not include electronic mail; the
words "including," "includes" and "include" shall be deemed to be followed by
the words "without limitation;" references to articles, sections (or
subdivisions of sections), recitals, appendices, exhibits, annexes or schedules
are to those of this Agreement; references to agreements and other instruments
shall be deemed to include all amendments and other modifications to such
agreements and instruments, but only to the extent such amendments and other
modifications are not prohibited by the terms of this Agreement; references to
Persons include their respective permitted successors and assigns and, in the
case of Governmental Authorities, Persons succeeding to their respective
functions and capacities; and all accounting terms used in this Agreement shall
be interpreted, all accounting determinations under this Agreement shall be made
and all financial statements required to be delivered under this Agreement shall
be prepared in accordance with GAAP as in effect from time to time, on a basis
consistent with the most recent audited financial statements, if any, of the
relevant Person delivered to the Agent, or otherwise reasonably acceptable to
the Agent.
ARTICLE II
PPA LETTER OF CREDIT
SECTION 2.1 COMMITMENTS.
Each Bank irrevocably agrees severally, on the terms and conditions
contained in this Agreement, to participate in the PPA Letter of Credit and in
the Drawing thereunder in the Percentage Interest of such Bank and in an
aggregate amount not to exceed at any time such Bank's Commitment.
SECTION 2.2 AMOUNT AND TERM OF PPA LETTER OF CREDIT.
(a) (i) Subject to the terms and conditions contained in this Agreement,
the Issuing Bank irrevocably agrees to issue the PPA Letter of Credit on the
Closing Date for the account of the Company and in a face amount not to exceed
the Stated Amount. The conditions precedent to the Closing Date are set forth in
Section 3.1.
(ii) On or prior to the date that is 120 days prior to the original
Expiration Date of the PPA Letter of Credit or any extension thereof pursuant to
this Section 2.2(a) (the "NOTICE DATE"), the Agent may on behalf of the Banks in
accordance with Section 2.19(a) extend the original or extended Expiration Date,
as the case may be, of such PPA Letter of Credit for an additional one or more
years beyond the original or extended Expiration Date, as the case may be. The
Agent shall notify the Company, the Collateral Agent and the Power Purchaser of
6
the Banks' decision regarding such extension on or prior to the applicable
Notice Date. Failure of the Agent to provide the Company, the Collateral Agent
and the Power Purchaser with written notice of renewal on or prior to the
applicable Notice Date in respect of the original Expiration Date or any
extended Expiration Date, as the case may be, or imposition of additional terms
and conditions adverse to the Company (in the Company's reasonable judgment) in
respect of such renewal, shall be deemed to constitute non-renewal of the PPA
Letter of Credit beyond the original or extended Expiration Date, as the case
may be. If the Agent agrees to extend the then current Expiration Date, the
Expiration Date of the PPA Letter of Credit shall, effective upon the giving of
such notice to the Company, be such extended date.
(b) The Issuing Bank shall have the right, upon the occurrence and during
the continuance of an Event of Default, to deliver to the Collateral Agent and
the Power Purchaser a notice in the form of Annex 2 to the PPA Letter of Credit
(a "TERMINATION NOTICE"), which notice shall be given at least thirty (30) days
prior to the date of termination referred to in such notice.
(c) The Agent shall, solely for informational purposes, deliver to the
Company a copy of any Termination Notice given to the beneficiary under the PPA
Letter of Credit; PROVIDED, HOWEVER, that the Issuing Bank's ability to
terminate the PPA Letter of Credit shall not be contingent upon the Agent's
delivery to the Company of such notice and that neither the Agent nor the Banks
shall incur any liability whatsoever as a result of the Agent's failure to
deliver such notice to the Company.
SECTION 2.3 PARTICIPATION IN PPA LETTER OF CREDIT.
Simultaneously with the issuance of the PPA Letter of Credit, the Issuing
Bank shall be deemed to have sold and transferred to each Bank, and each Bank
shall be deemed to have purchased and received from the Issuing Bank, in each
case irrevocably and without any further action by any party, an undivided
interest and participation in the PPA Letter of Credit, each Drawing and the
other Loan Obligations in respect thereof in an amount equal to such Bank's
Percentage Interest therein. The Agent shall promptly advise each Bank of any
cancellation or other termination of the PPA Letter of Credit and any Drawing;
PROVIDED, HOWEVER, that failure to provide such notice shall not limit or impair
the rights of the Agent hereunder or under the Financing Documents.
SECTION 2.4 DRAWING AND REIMBURSEMENT.
The payment by the Issuing Bank of a Drawing shall constitute the making by
the Issuing Bank of a loan to the Company in the amount of such payment. In the
event that a Drawing is not repaid by the Company by 10:00 a.m. (New York City
time), on the day of such Drawing, the Agent shall promptly notify each other
Bank. Each such Bank (including the Issuing Bank in its capacity as a Bank)
shall, on the day of such notification, make a loan to the Company, which shall
be used to repay the applicable portion of the Issuing Bank's loan with respect
to such Drawing, in an amount equal to the amount of such Bank's Percentage
Interest in the Drawing, for application to repay the Issuing Bank (such loan by
a Bank to be referred to as a "PPA LOC LOAN"), and shall deliver to the Agent
for the Issuing Bank's account, on the day of such notification and in
immediately available funds, the amount of such loan. In the event that any Bank
fails to make available to the Agent for the account of the Issuing Bank the
amount of such
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PPA LOC Loan, the Issuing Bank shall be entitled to recover such amount on
demand from such Bank together with interest thereon at the Federal Funds Rate
and until such reimbursement is made, the unreimbursed amount of the Issuing
Bank's loan shall be deemed to be a PPA LOC Loan for all purposes under this
Agreement.
SECTION 2.5 FEES.
The Company shall pay the following fees to the Agent for the respective
accounts of the Persons specified below:
(a) from and including the Closing Date, for the respective accounts of the
Banks, a letter of credit fee equal to the product of (x) the average daily
Stated Amount and (y) the Applicable Margin for the letter of credit fee,
payable quarterly in arrears on each Quarterly Date occurring after the Closing
Date; and
(b) from and including the Closing Date, for the account of the Issuing
Bank, a fronting fee equal to the product of (x) the average daily Stated Amount
and (y) 0.15% per annum, payable quarterly in arrears on each Quarterly Date
occurring after the Closing Date.
SECTION 2.6 INTEREST.
(a) RATE. The Company shall pay interest on the unpaid principal amount of
each PPA LOC Loan from the date such PPA LOC Loan is made until such principal
amount has been paid in full as follows:
(i) BASE RATE LOANS. As to Base Rate Loans, at a rate per annum equal
to the sum of (x) the Adjusted Base Rate plus (y) the Applicable Margin,
payable monthly in arrears on the first Business Day of each month;
(ii) EURODOLLAR RATE LOANS. As to Eurodollar Rate Loans, at a rate per
annum equal to the sum of (x) the Eurodollar Rate plus (y) the Applicable
Margin, payable on the last day of the applicable Interest Period or, if
such Interest Period exceeds three months, at intervals of three months
from the first day of such Interest Period; and
(iii) POST-DEFAULT RATE. During an Event of Default (and whether
before or after judgment), each PPA LOC Loan (whether or not due) and, to
the maximum extent permitted by Applicable Law, each other amount due and
payable under the Credit Documents shall bear interest at a rate per annum
equal to the applicable Post-Default Rate.
(b) METHOD OF ELECTING INTEREST RATES.
(i) Each PPA LOC Loan shall constitute a Base Rate Loan unless the
Company elects otherwise pursuant to the following provisions of this
Section 2.6(b).
(ii) Each PPA LOC Loan shall constitute a Base Rate Loan or a
Eurodollar Rate Loan as the Company may elect in accordance with this
Section 2.6(b). If no such election is timely made with respect to a PPA
LOC Loan, such PPA LOC Loan shall
8
initially constitute a Base Rate Loan in accordance with Section 2.6(b)(i).
The Company may from time to time elect to change or continue the interest
rate borne by each PPA LOC Loan, subject to the conditions set forth below,
as follows:
(A) with respect to PPA LOC Loans that are Base Rate Loans, the
Company may elect to convert all or any portion of such PPA LOC Loans
to Eurodollar Rate Loans as of any Business Day; and
(B) with respect to PPA LOC Loans that are Eurodollar Rate Loans,
the Company may elect to convert all or any portion of such PPA LOC
Loans to Base Rate Loans or elect to continue all or any portion of
such PPA LOC Loans as Eurodollar Rate Loans for an additional Interest
Period, in each case effective on the last day of the then current
Interest Period applicable to such PPA LOC Loans.
Each such election shall be made by delivering a notice (a "NOTICE OF
INTEREST RATE ELECTION") to the Agent (1) in the case of a conversion to or
continuation of a Eurodollar Rate Loan, not later than 10:00 a.m. (New York
City time) on the third Business Day prior to the day on which such
conversion or continuation is to be effective or (2) in the case of a
conversion to a Base Rate Loan, at any time prior to the day on which such
conversion is to be effective. Each Notice of Interest Rate Election shall
be in writing (including facsimile transmission) or by voice, promptly
confirmed in writing. A Notice of Interest Rate Election may, if it so
specifies, apply to only a portion of the aggregate principal amount of the
relevant PPA LOC Loan.
(iii) Each Notice of Interest Rate Election shall specify:
(A) the PPA LOC Loan (or portion thereof) together with the
amount of each thereof, to which such notice applies;
(B) the date on which the conversion or continuation selected in
such notice is to be effective, which shall comply with the applicable
clause of subsection (ii) above;
(C) if PPA LOC Loans are to be converted, each new type of PPA
LOC Loan together with the amount thereof, and if such new PPA LOC
Loans are Eurodollar Rate Loans, the duration of the initial Interest
Period applicable thereto; and
(D) if such PPA LOC Loans are to be continued as Eurodollar Rate
Loans for additional Interest Periods, the duration of such Interest
Periods.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period. No conversion
into or continuation of a Eurodollar Rate Loan shall be permitted when a Default
or an Event of Default has occurred and is continuing, and if a Default or an
Event of Default has occurred and is continuing, each Eurodollar Rate Loan shall
automatically be converted into a Base Rate Loan on the last day of the then
current Interest Period applicable thereto.
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(iv) A Notice of Interest Rate Election shall not be revocable by the
Company. If the Company fails to deliver a timely Notice of Interest Rate
Election to the Agent for any Eurodollar Rate Loan, such PPA LOC Loans
shall be converted into Base Rate Loans on the last day of the then current
Interest Period applicable thereto.
(v) Anything to the contrary in this Agreement notwithstanding, at no
time shall there be outstanding more than four different Interest Periods
applicable to the PPA LOC Loans, and Eurodollar Rate Loans that bear a
single Interest Period shall not be less than $1 million and shall be in
integral multiples of $100,000.
(c) FUNDING LOSSES. If the Company makes any payment of principal with
respect to any Eurodollar Rate Loan or any Eurodollar Rate Loan is converted
to a Base Rate Loan on any day other than the last day of an Interest Period
applicable thereto, or if the Company fails to borrow, repay or prepay any
Eurodollar Rate Loan after notice has been given to the Agent in accordance
with the terms hereof, the Company shall reimburse the Agent, for the ratable
account of the Banks, within 30 days after demand for any resulting loss or
expense incurred by them, including any loss incurred in obtaining,
liquidating or employing deposits from third parties. Without prejudice to
the foregoing, the Company shall indemnify the Agent and the Banks against
any direct (as opposed to consequential) loss or expense that the Agent or
the Banks may sustain or incur as a consequence of a failure by the Company
in payment of principal of, or interest on, any Eurodollar Rate Loan, or any
part thereof, including any interest, premium or penalty paid by the Agent or
any Bank to lenders of funds borrowed by it or deposited with it for the
purpose of making or maintaining such Eurodollar Rate Loan. A certificate as
to the amount of any such loss or expense in reasonable detail (specifying
the basis of such loss or expense) shall be promptly submitted by the Agent,
or by any Bank through the Agent, to the Company and shall be conclusive and
binding as to the amount thereof, absent manifest error.
(d) BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR UNFAIR. If on or
prior to the first day of any Interest Period for any Eurodollar Rate Loan:
(i) the Agent or any Bank determines, in its reasonable judgment, that
deposits in Dollars (in the applicable amounts) are not being offered to
the Agent or such Bank in the relevant market for such Interest Period, or
(ii) the Agent or such Bank, in its reasonable judgment, shall
determine that the Eurodollar Rate will not adequately and fairly reflect
the cost to the Agent or such Bank of funding its Eurodollar Rate Loans for
such Interest Period,
the Agent, or such Bank through the Agent, shall forthwith give notice thereof
(which notice shall describe in reasonable detail the basis for such
determination) to the Company, whereupon until the Agent, or such Bank through
the Agent, notifies the Company that the circumstances giving rise to such
suspension no longer exist, (A) the obligations of the Agent or such Bank to
make or continue Eurodollar Rate Loans or to convert outstanding PPA LOC Loans
into Eurodollar Rate Loans shall be suspended and (B) each outstanding
Eurodollar Rate Loan or, if only a Bank shall be affected, each Eurodollar Rate
Loan held by such Bank shall be converted into a Base Rate Loan on the last day
of the then current Interest Period applicable thereto.
10
(e) MAXIMUM RATE. This Agreement is hereby expressly limited so that in no
contingency or event, whether by reason of acceleration of the maturity of any
indebtedness hereunder or otherwise, shall the interest contracted for or
charged or received by the Banks exceed the maximum amount permissible under
Applicable Law. If, from any circumstance whatsoever, interest would otherwise
be payable to the Banks in excess of the maximum lawful amount, the interest
payable to the Banks shall be reduced to the maximum amount permitted under
Applicable Law, and the amount of interest for any subsequent period, to the
extent less than that permitted by Applicable Law, shall to that extent be
increased by the amount of such reduction.
SECTION 2.7 REPAYMENT.
On each Quarterly Date, the Company shall repay the principal amount of
each PPA LOC Loan in accordance with Exhibit D to this Agreement. Each PPA LOC
Loan shall mature and be repaid in full on the applicable PPA LOC Loan Required
Payment Date; PROVIDED that, the Company shall repay on or prior to the
Commercial Operation Date the outstanding principal amount of each PPA LOC Loan,
together with accrued interest to the date of such repayment on the principal
amount, in respect of any Drawing made prior to the Commercial Operation Date,
to the extent funds are available to pay such amounts in accordance with Section
3.9 of the Collateral Agency Agreement.
SECTION 2.8 PREPAYMENTS.
The Company may, at any time and from time to time on any Business Day,
upon prior written notice to the Agent not later than 11:00 a.m. (New York City
time), at least one Business Day before the day of any prepayment of the PPA LOC
Loans, such notice stating the proposed date and aggregate principal amount of
the prepayment, and if such notice is given the Company shall, prepay without
premium or penalty, except as provided in Section 2.6(c), the outstanding
principal amounts of the PPA LOC Loans in whole or in part, together with
accrued interest to the date of such prepayment on the principal amount prepaid.
All prepayments made hereunder shall be applied by the Agent and the Banks
against the principal amount of outstanding PPA LOC Loans in inverse order of
maturity; PROVIDED, that such prepayments shall first be applied to the
prepayment of outstanding Base Rate Loans to the extent thereof and then to the
prepayment of outstanding Eurodollar Rate Loans.
SECTION 2.9 SECURITY.
The Obligations shall be secured by the Security Documents, the rights and
remedies in respect of which shall be exercised pursuant to the Collateral
Agency Agreement.
SECTION 2.10 PAYMENTS.
(a) The Company shall make each payment hereunder and under the PPA LOC
Loan Note not later than 10:00 a.m. (New York City time), on the day when due to
the Agent at its address set forth in Section 9.2, in Dollars in immediately
available funds. The Agent will promptly thereafter cause to be distributed like
funds relating to the payment of principal (including reimbursement of the
Drawing), interest or fees ratably (other than amounts payable
11
for the account of the Issuing Bank pursuant to Section 2.5(b), which shall be
payable solely to the Issuing Bank, or payable pursuant to Section 9.4) to the
Banks and like funds relating to the payment of any other amount payable to any
Bank to such Bank, in each case to be applied in accordance with the terms of
this Agreement. The Agent may withhold from any interest payment to any Bank an
amount equal to any applicable withholding tax (including upon the failure of
any Bank to provide the forms or other documentation required under Section
2.17(f)).
(b) Unless the Agent receives notice from the Company before the date on
which any payment is due to the Banks hereunder that the Company will not make
such payment in full, the Agent may assume that the Company has made such
payment in full to the Agent on such date, and the Agent may, in reliance upon
such assumption, cause to be distributed to each Bank on such due date an amount
equal to the amount then due to such Bank. If and to the extent that the Company
has not so made such payment in full to the Agent on the date on which such
payment is due, each Bank agrees, irrevocably and without qualification or
exception, to repay to the Agent forthwith on demand such amount distributed to
such Bank together with interest thereon, for each day from the date such amount
is distributed to such Bank until the date on which such Bank repays such amount
to the Agent, at the Federal Funds Rate.
(c) All payments made by the Company to each of the Banks and the Agent
under this Agreement and the PPA LOC Loan Note will be made without set-off,
counterclaim or other defense.
SECTION 2.11 COMPUTATION OF INTEREST AND FEES.
All computations of interest and fees hereunder shall be made on the basis
of a year of 360 days for the actual number of days (including the first day but
excluding the last day) occurring in the period for which such interest or fees
are payable. Each calculation and each determination by the Agent of an interest
rate hereunder shall be conclusive and binding for all purposes, absent manifest
error.
SECTION 2.12 PAYMENTS ON NON-BUSINESS DAYS.
Whenever any payment hereunder or under the PPA LOC Loan Note is stated to
be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or fees, as the case may be.
If no due date is specified for the payment of any amount payable by the Company
hereunder, such amount shall be due and payable not later than 10 Business Days
after receipt by the Company of written demand from the Agent for payment
thereof.
SECTION 2.13 SHARING OF PAYMENTS, ETC.
(a) Each Bank agrees that if, as a result of the exercise of a right of
set-off, banker's lien or counterclaim or other similar right or the receipt of
a secured claim, it receives any payment in respect of the PPA LOC Loans or
other Obligations hereunder it shall promptly notify the Agent thereof (and the
Agent shall promptly notify the other Banks). If, as a result of such payment,
such Bank receives a greater percentage of the Obligations owed to it under this
Agreement than the percentage received by any other Bank, such Bank shall
purchase a
12
participation (which it shall be deemed to have purchased simultaneously upon
the receipt of such payment) in the Obligations then held by such other Banks so
that all such recoveries of principal and interest with respect to all
Obligations owed to each Bank shall be pro rata on the basis of its respective
amount of such Obligations owed to all Banks; PROVIDED, that if all or part of
such proportionately greater payment received by such purchasing Bank is
thereafter recovered by or on behalf of the Company from such Bank, such
purchase shall be rescinded and the purchase price paid for such participation
shall be returned to such Bank to the extent of such recovery, but without
interest.
(b) Each Bank which receives a secured claim as described in subsection (a)
above shall, to the extent practicable, exercise its rights in respect of such
secured claim in accordance with such subsection (a) and otherwise in a manner
consistent with the rights of the Banks entitled under this Section 2.13 to
share in the benefits of any recovery on such secured claim.
(c) The Company expressly consents to the foregoing arrangements and agrees
that any holder of a participation in any Obligation so purchased or otherwise
acquired of which the Company has received notice may exercise any and all
rights of set-off, banker's lien or counterclaim with respect to any and all
monies owing by the Company to such holder as fully as if such holder were a
holder of such Obligation in the amount of the participation held by such
holder.
SECTION 2.14 EVIDENCE OF DEBT.
(a) The indebtedness of the Company resulting from all PPA LOC Loans shall
be evidenced by this Agreement and the promissory note substantially in the form
of Exhibit B (the "PPA LOC LOAN NOTE"), delivered by the Company to the Agent
for the benefit of the Banks in accordance with the terms hereof.
(b) The books and accounts of the Agent shall be conclusive evidence,
absent manifest error, of the amounts of the Drawing, all PPA LOC Loans, fees,
interest and other amounts advanced, due, outstanding, payable or paid pursuant
to this Agreement or the PPA LOC Loan Note.
SECTION 2.15 INCREASED COSTS AND REDUCED RETURNS.
(a) If, on or after the date hereof, the adoption of any Applicable Law, or
any change therein, or any change in the interpretation or administration
thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by the Agent or
any Bank with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency:
(i) shall subject the Agent or such Bank to any tax, duty or other
charge (other than routine examination fees or Taxes) with respect to the
Eurodollar Rate Loans, the PPA LOC Loan Note or its obligation to make or
continue Eurodollar Rate Loans, or shall change the basis of taxation of
payments to the Agent or any Bank of the principal of or interest on its
Eurodollar Rate Loans or any other amounts due under this Agreement in
respect of its Eurodollar Rate Loans or its obligation to make or continue
Eurodollar Rate Loans (except for changes in the rate of tax on the net
income of the
13
Agent or such Bank imposed by the federal, state or local jurisdiction in
which the Agent's or such Bank's principal executive office is located); or
(ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including any such requirement imposed by
the Board of Governors of the Federal Reserve System, but excluding with
respect to any Eurodollar Rate Loan any such requirement provided in
Section 2.17(b), against assets of, deposits with or for the account of, or
credit extended by, the Agent or any Bank or shall impose on the Agent or
any Bank or on the London interbank market any other condition affecting
the Eurodollar Rate Loans, the PPA LOC Loan Note or its obligation to
advance Eurodollar Rate Loans;
and the result of any of the foregoing is to increase the cost to the Agent or
such Bank of making or continuing any Eurodollar Rate Loan or to reduce the
amount of any sum received or receivable by the Agent or such Bank under this
Agreement or under the PPA LOC Loan Note with respect thereto by an amount
deemed by the Agent or such Bank to be material, then the Agent, or such Bank
through the Agent, shall deliver to the Company as promptly as practicable a
certificate setting forth in reasonable detail the additional amounts that the
Agent or such Bank, as the case may be, determines will fully compensate it for
such reduction, increased cost or payment and the basis for the determination of
such amount; PROVIDED, that the Company shall not be obligated to compensate the
Agent or any Bank for the amount of such increased cost incurred with respect to
a period of time prior to the date which is 90 days before the date on which the
Agent first notifies the Company of a claim for such compensation or that an
event had occurred which will entitle the Agent or a Bank to such compensation.
Any such amount claimed by the Agent or any Bank shall, in the case of clause
(i) above, be net of applicable tax savings, if any, directly attributable
thereto. Within 30 days after demand by the Agent, the Company shall pay to the
Agent, for its account or for the account of the applicable Bank, as the case
may be, such additional amount shown as due on any such certificate, absent
manifest error.
(b) In the event that the Agent or any Bank shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
on all the parties hereto) at any time that the Agent or such Bank is required
to maintain reserves in respect of Eurocurrency Liabilities during any period
during which any PPA LOC Loan owing to it bears interest based on the Eurodollar
Rate (each such period, for the Agent or such Bank, a "EUROCURRENCY RESERVE
PERIOD"), but only in respect of any period during which any reserve shall
actually be maintained by the Agent or such Bank for any Eurodollar Rate Loan as
a result of a reserve requirement applicable to it under Regulation D in
connection with Eurocurrency Liabilities, then the Agent, or such Bank through
the Agent, shall promptly give notice to the Company of such determination, and
the Company shall directly pay to the Agent, for its account or for the account
of the applicable Bank, as the case may be, additional interest on the unpaid
principal amount of such PPA LOC Loan during such Eurocurrency Reserve Period at
a rate PER ANNUM which shall, during each monthly period applicable to such PPA
LOC Loan, be the amount by which (x) the Eurodollar Rate for such monthly period
divided (and rounded upward to the next whole multiple of 1/100 of 1%) by a
percentage equal to 100% minus the then stated maximum rate of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable to the Agent or such Bank in respect of Eurocurrency
Liabilities exceeds (y) the Eurodollar Rate for such monthly period. The Agent,
or such Bank through the Agent, shall
14
furnish along with such notice a certificate setting forth in reasonable detail
the cost actually incurred to maintain such reserves and the basis for the
determination of such amount; PROVIDED, that the Company shall not be obligated
to compensate the Agent or any Bank for the amount of such increased cost
incurred with respect to a period of time prior to the date which is 90 days
before the date on which the Agent first notifies the Company of a claim for
such compensation or that an event has occurred which will entitle the Agent or
a Bank to such compensation. Additional interest payable pursuant to the
immediately preceding sentence shall be paid by the Company at the time that it
is otherwise required to pay interest in respect of such PPA LOC Loan, or, if
later demanded by the Agent or any Bank, promptly on demand. Each of the Agent
and the Banks agrees that, if notice is given to the Company of the existence of
a Eurocurrency Reserve Period, the Agent, or the applicable Bank through the
Agent, shall promptly notify the Company of any termination thereof, at which
time the Company shall cease to be obligated to pay additional interest to the
Agent or such Bank pursuant to the first sentence of this paragraph until such
time, if any, as a subsequent Eurocurrency Reserve Period shall occur.
(c) The Agent, and each Bank through the Agent, will promptly notify the
Company of any event of which it has knowledge, occurring after the date hereof,
which will entitle the Agent or such Bank to compensation pursuant to this
Section and will designate a different lending office if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the sole judgment of the Agent or such Bank, be otherwise disadvantageous to the
Agent or such Bank.
SECTION 2.16 CAPITAL ADEQUACY.
If the Agent or any Bank shall determine that, after the date hereof, the
adoption of any Applicable Law regarding capital adequacy, or any change
therein, or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of the Agent or such Bank or its holding company as a
consequence of the Agent's or such Bank's obligations hereunder to a level below
that which the Agent or such Bank could have achieved but for such adoption,
change, request or directive (taking into consideration its policies with
respect to capital adequacy) by an amount deemed by the Agent or such Bank to be
material, then the Agent, or such Bank through the Agent, shall deliver to the
Company as promptly as practicable (but in no event later than 120 days after
the Agent or such Bank has actual knowledge of such claim for capital adequacy)
a certificate setting forth in reasonable detail the amount being charged by the
Agent or such Bank and the basis for the determination of such amount. Within 30
days after the delivery of such certificates by the Agent, the Company shall pay
to the Agent, for its account or for the account of the applicable Bank, as the
case may be, the amount shown as due on any such certificate.
SECTION 2.17 TAXES.
(a) Payments by the Company to the Agent and the Banks under this Agreement
and the PPA LOC Loan Note will be made free and clear of and without deduction
for Taxes, other than Taxes based on the net income of the Agent or any Bank
(including franchise taxes imposed
15
in lieu of net income taxes) imposed by (i) the United States federal
government, (ii) the jurisdiction where the Agent or such Bank is organized or
has its principal office or (iii) the jurisdiction of the branch of such Bank
maintaining any PPA LOC Loan or the branch of the Agent through which it renders
its services as the Agent ("EXCLUDED TAXES"). If the Company is required by law
to deduct Taxes (other than Excluded Taxes) from such a payment, then the sum
payable under the instrument to which the payment relates will be increased so
that such deduction does not result in a diminution in the amount the Agent or
any Bank actually receives.
(b) To the extent permitted by law, without duplication of amounts paid by
the Company under Section 2.17(a), the Company hereby indemnifies and holds
harmless the Agent and each Bank from and against, and agrees to reimburse the
Agent and each Bank on an after-tax basis (computed taking into account any
deductions or other benefits available for federal income tax purposes for the
Agent or such Bank if it is a United States taxpayer and any deductions and
benefits available for income tax purposes in any jurisdiction in which the
Agent or such Bank is a taxpayer) on demand for, any and all Taxes paid or
incurred by the Agent or such Bank in connection with the transactions
contemplated by this Agreement; PROVIDED, HOWEVER, that the foregoing indemnity
does not cover Excluded Taxes. Reimbursement on an "after-tax basis" means on a
basis such that the Agent or such Bank is made whole after taking into account
income taxes that the Agent or such Bank will owe on the indemnity or
reimbursement payment in any jurisdiction and any related tax benefits, assuming
the Agent or such Bank is subject to income taxes at the highest marginal rates.
Nothing in this paragraph shall interfere with the right of the Agent or any
Bank to arrange its tax affairs in whatever manner it thinks fit and, in
particular, the Agent and the Banks are under no obligation to claim a deduction
or other benefit relating to these transactions ahead of any other claim,
relief, credit, deduction or other benefit to which it is entitled. The Agent,
or applicable Bank through the Agent, shall promptly give written notice to the
Company after (but in no event later than 60 days after) the Agent or such Bank
has actual knowledge of the imposition of any Taxes subject to indemnification
hereunder; PROVIDED, HOWEVER, that failure to give such notice within such 60
day period will not relieve the Company of the obligation to indemnify the Agent
or such Bank in accordance with the terms hereof, except to the extent of
interest that would have been avoided had the notice been given prior to the end
of such 60-day period.
(c) The Company will provide evidence that all Taxes imposed on payments
under this Agreement, any PPA LOC Loan or the PPA LOC Loan Note, have been fully
paid to the appropriate authorities by delivering official receipts or notarized
copies to the Agent within 30 days after payment. The Company will compensate
the Agent or any Bank that has to pay any Taxes because the Company failed to
timely furnish such evidence; PROVIDED, that prior to paying such Taxes, the
Agent, or such Bank through the Agent, shall have notified the Company of its
intent to make such payment.
(d) If the Company so requests promptly in writing after receipt of any
notice under Section 2.17 hereof, the Agent or applicable Bank will contest in
good faith the Taxes at the Company's expense, keep the Company fully informed
about the progress of the contest, consult in good faith with the Company's
counsel regarding conduct of the contest, and not compromise or otherwise settle
the contest without the Company's consent (which shall not be unreasonably
withheld or delayed); PROVIDED, that the Agent or such Bank may in its sole
discretion select the forum for the contest and determine whether the contest
will be by resisting payment of the
16
Taxes or by paying the Taxes and seeking a refund; PROVIDED, FURTHER that the
Agent or such Bank will be under no obligation to contest unless (A) if the
Agent or such Bank requests, the Company has provided the Agent or such Bank an
opinion of independent tax counsel selected by the Company and reasonably
acceptable to the Agent or such Bank to the effect that there is a reasonable
basis for the contest, (B) the amount in controversy is at least $75,000, (C)
the Agent or such Bank has received satisfactory indemnification and security
for any liability, loss, cost or expense arising out of the contest (including,
but not limited to, all reasonable legal and accounting fees and expenses,
penalties, interest and additions to tax), (D) if requested by the Agent or such
Bank, the Company has admitted in writing its duty to indemnify the Agent or
such Bank for the Taxes if the contest is lost (but such admission shall not
preclude the Company from raising a defense to liability if a court of competent
jurisdiction has rendered a decision articulating the cause of such Taxes, and
the cause is not one for which the Company is responsible under this Section
2.17), and (E) if the contest is conducted in a manner that requires paying all
or part of the Taxes, the Company has paid the amount required.
(e) If the Company so requests within 10 days of notice to the Company of
the imposition of any Taxes on payments to any of the Banks of a type not
generally imposed on United States or foreign lenders making advances of the
types contemplated hereunder, such Banks shall (consistent with legal and
regulatory restrictions) comply with Section 2.19 hereof.
(f) At such times as may be required by Applicable Law or as the Agent or
the Company may reasonably request, each Bank agrees that it will deliver to the
Agent and the Company duly completed forms of any applicable jurisdiction or
other documentation reasonably satisfactory to the Agent and the Company that
such Bank is entitled to receive payments under this Agreement without deduction
or withholding of income tax under the Applicable Law of such jurisdiction. Each
Bank further agrees to notify the Agent and the Company of the occurrence of any
event (including any change in treaty, law or regulation) that would render such
Bank unable to receive payments hereunder without such deduction or withholding.
The provisions of this Section 2.17(f) shall apply to any successor holder of a
PPA LOC Loan Note.
SECTION 2.18 ILLEGALITY.
If, on or after the date of this Agreement, the adoption of any Applicable
Law, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Agent or any Bank with any request or directive (whether or not having
the force of law) of any such Governmental Authority, central bank or comparable
agency shall make it unlawful or impossible for the Agent or such Bank to make,
continue or convert its Eurodollar Rate Loans, the Agent, or such Bank through
the Agent, shall so notify the Company, whereupon until the Agent, or such Bank
through the Agent, notifies the Company that the circumstances giving rise to
such suspension no longer exist, the obligation of the Agent or such Bank to
make or continue Eurodollar Rate Loans, or to convert outstanding PPA LOC Loans
into Eurodollar Rate Loans, shall be suspended. Before giving any notice to the
Company pursuant to this Section 2.18, the Agent or applicable Bank shall
designate a different lending office for the Eurodollar Rate Loans if such
designation will avoid the need for giving such notice and will not, in the sole
judgment of the Agent or such Bank, be otherwise
17
disadvantageous to the Agent or such Bank. If such notice is given, each
Eurodollar Rate Loan of the Agent or such Bank then outstanding shall either (i)
be converted to a Base Rate Loan on the last day of the then current Interest
Period applicable to such Eurodollar Rate Loan if the Agent or such Bank may
lawfully continue to make and continue such PPA LOC Loan to such day, or (ii) be
immediately converted to a Base Rate Loan if the Agent or such Bank shall
determine that it may not lawfully continue to make and continue such PPA LOC
Loan to such day; PROVIDED, that the Company shall not be obligated to make any
payment pursuant to Section 2.6(c) as a result of such conversion. If the
Company so requests within 10 days of receipt of the notice referred to above,
the applicable Bank shall (consistent with legal and regulatory restrictions)
comply with Section 2.19 hereof.
SECTION 2.19 ASSIGNMENTS BY BANKS.
(a) If at least 180 days before the Expiration Date, the Agent shall have
requested the consent of each of the other Banks to the extension of the PPA
Letter of Credit, and if the Agent shall not, within twenty-five (25) days of
issuing such request, have received the written consent of any Bank to the
extension proposed by the Agent, the Agent shall have the right to require such
Bank to transfer all of its proportionate share of the PPA LOC Loans in
accordance with Section 2.19(b). Prior to the Notice Date, each Bank shall give
the Agent written notice of such Bank's election to extend or not to extend the
original or extended Expiration Date of the PPA Letter of Credit for an
additional one or more years as specified by the Agent.
(b) In the event that (i) a Bank is required to comply with this Section
2.19 after a request from the Company pursuant to Sections 2.17 or 2.18, (ii)
the Company or the Issuing Bank requests that the provisions of this Section
2.19 apply to a Bank within 10 days after the Company receives a notice from the
Agent that (a) such Bank has failed to make available to the Agent its portion
of any PPA LOC Loan on the date required to be made available to the Agent
pursuant to this Agreement after the Agent has made written demand upon such
Bank for such payment, (b) such Bank has provided the Agent with notice that
such Bank shall not make available to the Agent such portion of any PPA LOC Loan
required to be made available to the Agent pursuant to this Agreement or (c)
such Bank has failed to reimburse the Agent pursuant to the terms of this
Agreement, or (iii) the Issuing Bank requests that the provisions of this
Section 2.19 apply to a Bank in the event the long-term debt rating of such Bank
shall at any time be less than a rating of "A" or the equivalent by S&P or by
Moody's, then such Bank shall assign all or a part of its proportionate share of
the PPA LOC Loans and its Commitment to a replacement bank (which may be, but is
not required to be, a Bank, and shall be subject to the prior written consent of
the Issuing Bank) (a "REPLACEMENT BANK") designated by the Company; PROVIDED,
that any assignment or transfer made by a Bank to a Replacement Bank shall
substantially be in the form of Exhibit C hereto, and any assignment of all or
part of the PPA LOC Loans or other obligations with respect to the PPA Letter of
Credit shall be made without recourse, representation or warranty. The Company
shall promptly pay when due all reasonable fees and expenses which such Bank
incurs in connection with such transfer or assignment and the Company shall
cause the Replacement Bank to pay to the Agent for the account of the assigning
Bank in immediately available funds all amounts outstanding or payable under
this Agreement to each Bank assigning its interest in the PPA LOC Loans or other
obligations with respect to the PPA Letter of Credit.
18
SECTION 2.20 REDUCTION IN COMMITMENTS/REIMBURSEMENTS.
The Company shall have the right to refinance the Commitment and any
outstanding PPA LOC Loans, if any, without premium or penalty, except as
provided in Section 2.6(c), upon at least 10 Business Days' prior written notice
to the Agent.
SECTION 2.21 RIGHT OF SET-OFF.
Subject to the provisions of the Collateral Agency Agreement, the Company
hereby authorizes each Bank (in addition to, and without limitation of, any
right of set-off, banker's lien or counterclaim a Bank may otherwise have), upon
the occurrence and during the continuance of any Event of Default, at any time
and from time to time, without notice to the Company or any Person other than
the Collateral Agent (any such notice being hereby expressly waived by the
Company to the extent it may legally do so) to set off and appropriate and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held, and other indebtedness at any time owing, by such Bank in any
of its offices, wherever located (whether such deposits or indebtedness be in
Dollars or in any other currency), to or for the credit or the account of the
Company against any and all of the Obligations and liabilities of the Company
now or hereafter existing under this Agreement, irrespective of whether or not
such Bank shall have made any demand hereunder or thereunder and although such
Obligations may be contingent or unmatured.
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.1 CONDITIONS PRECEDENT TO THE CLOSING DATE.
The occurrence of the Closing Date is subject to satisfaction or waiver of
the following conditions precedent:
(a) issuance of the Bonds and submission to the Agent of duplicate
originals or certified copies of all documents submitted in connection with the
issuance of the Bonds on the Closing Date, which shall be in form and substance
satisfactory to the Agent;
(b) receipt by the Issuing Bank and the Agent of the following, in each
case in the form approved by the Agent on the Closing Date:
(i) this Agreement and the PPA LOC Loan Note duly executed by the
Company;
(ii) an original of each of the Security Documents, duly executed by
the parties thereto;
(iii) a copy of each other Financing Document, certified by the
Company as to completeness and authenticity;
19
(iv) written opinions of counsel acceptable to the Agent, addressed to
the Agent and the Banks, and in form and substance satisfactory to the
Agent and covering such matters as the Agent may reasonably request;
(v) evidence satisfactory to the Agent that each of the parties to the
Project Contracts, Financing Documents and Security Documents shall have
duly and irrevocably appointed a process agent to act for and on behalf of
such person, to receive summonses and other legal process in connection
with any suit, action or proceeding relating to such documents in the
jurisdictions in which it is required to submit to such jurisdiction and
such appointment shall have been accepted and all fees scheduled to accrue
to each such agent for the service of process shall have been paid in full;
and
(vi) evidence satisfactory to the Agent that all actions necessary or
appropriate in order to effectively establish, create or perfect the
security interest have been duly taken.
(c) payment by the Company of all accrued fees and expenses (as provided in
Sections 2.5 and 9.4) of the Agent and the Banks (including the reasonable
accrued fees and disbursements of counsel to the Agent and the Banks), to the
extent that one or more statements for such fees and expenses have been
presented for payment.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.1 REPRESENTATIONS AND WARRANTIES OF COMPANY.
The Company hereby makes for the benefit of the Agent and the Banks all of
the representations and warranties of the Company contained in Article III of
the Indenture (which representations and warranties are incorporated by
reference herein as if fully set forth herein and which representations and
warranties shall be true and correct as of the date hereof and the Closing
Date).
SECTION 4.2 REPRESENTATIONS AND WARRANTIES OF THE ISSUING BANK.
The Issuing Bank hereby represents and warrants to the Company and the
Agent as follows:
(a) The Issuing Bank is duly formed, validly existing and in good standing
under the laws of its jurisdiction of organization.
(b) The Issuing Bank has all necessary power and authority to execute and
deliver, and to perform its obligations under, this Agreement and the PPA Letter
of Credit.
(c) All action on the part of the Issuing Bank that is required for the
authorization, execution and delivery of, and performance by the Issuing Bank of
its obligations under, this Agreement and the PPA Letter of Credit has been duly
and effectively taken.
20
(d) This Agreement has been, and, upon issuance thereof, the PPA Letter of
Credit will have been, duly executed and delivered by the Issuing Bank.
(e) This Agreement constitutes, and the PPA Letter of Credit upon issuance
thereof will constitute, legal, valid and binding obligations of the Issuing
Bank, enforceable against it in accordance with the respective terms thereof,
except as such enforceability (i) may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting the
enforcement of creditors' rights and remedies generally and (ii) is subject to
general principles of equity (regardless of whether enforceability is considered
in a proceeding in equity or at law).
ARTICLE V
COVENANTS
SECTION 5.1 COVENANTS.
So long as any Commitment is in effect, the PPA Letter of Credit is
outstanding or the Obligations remain unpaid, the Company shall observe and
perform all of the covenants of the Company contained in Article VI of the
Indenture (which covenants are incorporated herein by reference as if fully set
forth herein).
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.1 EVENTS OF DEFAULT.
Each of the following shall constitute an "Event of Default" under this
Agreement so long as the same shall be continuing:
(a) the Company shall fail to pay any amount due under this Agreement
(including under the PPA LOC Loan Note) within 15 days after the due date
thereof; or
(b) an "Event of Default" under the Indenture shall have occurred and be
continuing; or
(c) an "Event of Default" under the DSR LOC Reimbursement Agreement shall
have occurred and be continuing; or
(d) an "Event of Default" under the Working Capital Agreement shall have
occurred and be continuing.
SECTION 6.2 REMEDIES.
Upon the occurrence and during the continuation of an Event of Default, the
Agent shall, at the request of the Required Banks, take one or more of the
following actions: (i) terminate the
21
PPA Letter of Credit in accordance with the terms thereof, (ii) declare the
Obligations, all interest thereon and all other amounts payable under this
Agreement and the PPA LOC Loan Note to be forthwith due and payable, including
but not limited to the amount of any and all PPA LOC Loans which may be made
upon a Drawing under the PPA Letter of Credit which occurs after the date on
which the Agent declares such amounts to be due and payable, but prior to the
effective date of termination of such PPA Letter of Credit in accordance with
Section 2.2(b), whereupon the Obligations, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Company or (iii) terminate the ability of the Company to continue
PPA LOC Loans as, or to convert PPA LOC Loans to, Eurodollar Rate Loans;
PROVIDED, that the Agent and the Banks shall not have the right to exercise any
other remedy hereunder or otherwise available to the Agent or any Bank except in
accordance with the provisions of the Collateral Agency Agreement.
SECTION 6.3 COLLATERALIZATION UPON ACCELERATION OF THE BONDS.
In the event that an Event of Default hereunder results from an "EVENT OF
DEFAULT" under the Indenture and the Trustee accelerates amounts due under the
Indenture, the PPA LOC Provider shall be entitled to require collateralization
of the Stated Amount by having the Collateral Agent deposit (in a separate
account to be held by the Collateral Agent), at the time that any amounts are
paid to the Trustee in respect of accelerated amounts due under the Indenture,
an amount equal to the amount that would have been disbursed to the Agent at
such time (based on pro rata payment requirements) if Drawings had been made to
the full extent of the Stated Amount ("DEEMED PPA LOC LOANS") and the Deemed PPA
LOC Loans had been accelerated at the same time as an acceleration under the
Indenture. Upon a Drawing on the PPA Letter of Credit, a portion of the amount
in the separate account equal to such Drawing's proportionate share of the
Stated Amount shall be transferred by the Collateral Agent to the PPA LOC
Provider. The Agent, the Issuing Bank and each Bank agree that upon termination
or expiration of the PPA Letter of Credit, all amounts in such separate
collateral account that have not been transferred pursuant to the previous
sentence (to the extent of such expiration or termination) shall be transferred
to the Collateral Agent.
ARTICLE VII
CHARACTER OF OBLIGATIONS
SECTION 7.1 OBLIGATIONS ABSOLUTE.
The Obligations shall be absolute, unconditional and irrevocable and shall
not be affected or impaired under any circumstances whatsoever, including the
following circumstances:
(a) any lack of validity or enforceability of any provision of any Project
Contract or Financing Document;
(b) any amendment or waiver of, or any consent to departure from, any
provision of any Project Contract or Financing Document;
22
(c) the existence of any claim, set-off, defense or other right that the
Company may have at any time against the beneficiary of the PPA Letter of Credit
(or any Person for whom such beneficiary may be acting), any Bank, the Agent or
any other Person, whether in connection with any Project Contract or Financing
Document, the transactions contemplated thereby or any unrelated transaction;
(d) any statement or signature in any certificate or other document
presented under the PPA Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect, or any such statement being untrue or
inaccurate in any respect whatsoever;
(e) any exchange, release or nonperfection of any Collateral or other
collateral, or any release, amendment or waiver of or consent to departure from
any Project Contract, Financing Document or any guaranty, for any of the
Obligations;
(f) payment by the Issuing Bank under the PPA Letter of Credit against
presentation of a draft or certificate that does not comply with the terms of
the PPA Letter of Credit; or
(g) any other circumstance or happening whatsoever, whether or not similar
to any of the foregoing.
SECTION 7.2 LIMITED LIABILITY OF AGENT AND BANKS.
As among the Company, the Agent and the Banks (including the Issuing Bank),
the Company assumes all risks of the acts or omissions of the beneficiaries of
the PPA Letter of Credit with respect to the use of the PPA Letter of Credit.
Neither the Agent nor any Bank nor any of their respective officers, directors,
employees or agents shall be liable or responsible for (i) the use that may be
made of the PPA Letter of Credit or any acts or omissions of any beneficiaries
of the PPA Letter of Credit in connection with the PPA Letter of Credit; (ii)
the form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted in connection with the PPA Letter of Credit or of any
endorsement thereon, even if such document or endorsement should prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged;
(iii) payment by the Issuing Bank against presentation of any document that does
not comply with the terms of the PPA Letter of Credit, including failure of any
document to bear any reference or adequate reference to the PPA Letter of
Credit; or (iv) any other circumstance whatsoever in making, delaying to make or
failing to make payment under the PPA Letter of Credit; PROVIDED, HOWEVER, that
the Company shall have a claim against the Issuing Bank, and the Issuing Bank
shall be liable to the Company, to the extent of any direct, as opposed to
consequential, damages suffered by the Company that the Company proves were the
result of the Issuing Bank's willful misconduct or gross negligence in paying
under the PPA Letter of Credit or the Issuing Bank's willful or grossly
negligent failure to pay under the PPA Letter of Credit after the presentation
to it by the beneficiary of a draft and certificate strictly complying with the
terms and conditions of the PPA Letter of Credit (unless the Issuing Bank in
good faith believed itself (based upon an opinion of counsel) to be prohibited
by law or legal authority from making such payment). In furtherance and not in
limitation of the foregoing, the Issuing Bank may accept any document that
appears on its face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary.
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ARTICLE VIII
THE AGENT
SECTION 8.1 AUTHORIZATION AND ACTION.
(a) Each Bank hereby appoints and authorizes the Agent to take such action
as agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for by
the Credit Documents (including enforcement of and collection under any Credit
Document or other Project Contract), the Agent shall not be required to exercise
any discretion or take any action, but shall be required to act or to refrain
from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Banks, and such instructions shall
be binding upon all Banks and the holders of any PPA LOC Loan Note; PROVIDED,
HOWEVER, that the Agent shall not be required to take any action that, in the
Agent's sole judgment, exposes the Agent to personal liability or that is
contrary to any Credit Document or other Project Contract or Applicable Law. In
performing its function and duties hereunder as Agent, the Agent shall act
solely as the agent of the Banks and in its capacity as Issuing Bank it shall
act solely as issuer of the PPA LOC Letter of Credit, and does not assume and
shall not be deemed to have assumed in either such capacity any obligation
towards or relationship of agency or trust or other fiduciary relationship with
or for the Company or any other party to any Project Contract.
(b) Each Bank hereby authorizes the Agent in the name of and on behalf of
such Bank to sign such documents, take all such actions and perform such
obligations that the Agent deems necessary or appropriate to bind each of the
Banks under the Credit Documents and the Transaction Documents, and to create,
perfect or maintain the existence or perfected status of any security interest,
to be the named "Senior Party" under the Collateral Agency Agreement, and the
sole named payee, in respect of all of the Financing Liabilities of the Company
under or pursuant to this Agreement and the PPA LOC Loan Note, and all
Collateral to the extent securing such Financing Liabilities, and to take all
such actions and perform such obligations that the Agent deems necessary or
appropriate in such capacity.
SECTION 8.2 AGENT'S RELIANCE, ETC.
Neither the Agent nor the Issuing Bank nor any of their directors,
officers, agents or employees shall be liable for any action taken or omitted to
be taken by it or them under or in connection with any Credit Document or other
Project Contract, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the Agent and
the Issuing Bank (i) may treat any Bank that has signed an Assignment and
Acceptance as the holder of the applicable portion of the Obligations; (ii) may
consult with legal counsel (including counsel for the Company or any Affiliate),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (iii) makes
no warranty or representation to any Bank and shall not be responsible to any
Bank for any statements, warranties or representations made in or in connection
with any Credit
24
Document or other Project Contract; (iv) shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants or
conditions of any Credit Document or other Project Contract on the part of the
Company or any Affiliate or to inspect the property (including the books and
records) of the Company or any Affiliate thereof; (v) shall not be responsible
to any Bank for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Credit Document or other Project
Contract or any other instrument or document furnished pursuant hereto or
thereto; and (vi) shall incur no liability under or in respect of any Credit
Document or other Project Contract by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telecopier or
otherwise) believed by it to be genuine and signed or sent by the proper party
or parties.
SECTION 8.3 THE AGENT, THE ISSUING BANK AND AFFILIATES.
With respect to its Commitment and participation in the PPA Letter of
Credit, the Agent and the Issuing Bank shall have the same rights and powers
under this Agreement as any other Bank and may exercise the same as though it
were not the Agent or the Issuing Bank, as the case may be; and the term "BANK"
or "BANKS" shall, unless otherwise expressly indicated, include the Agent and
Issuing Bank in their capacity as a Bank (including the Issuing Bank in its
capacity as such). The Agent and the Issuing Bank and their Affiliates may
accept deposits from, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with, the Company, any Affiliate
thereof and any Person that may do business with or own securities of the
Company or any Affiliate thereof, all as if the Agent and the Issuing Bank,
respectively, were not the Agent and the Issuing Bank, and without any duty to
account therefor to the Banks.
SECTION 8.4 BANK CREDIT DECISION.
Each Bank agrees that it has, independently and without reliance on the
Agent, the Issuing Bank or any other Bank and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Bank also agrees that it will,
independently and without reliance on the Agent, the Issuing Bank or any other
Bank and based on such documents and information as it deems appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement.
SECTION 8.5 INDEMNIFICATION.
Each of the Banks agree to indemnify the Agent and the Issuing Bank (to the
extent not promptly reimbursed by the Company and without limiting the
obligation of the Company to do so), on demand, ratably according to such Bank's
Percentage Interest, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever that may at any time (including
at any time following the payment of any Obligations or termination of this
Agreement) be imposed on, incurred by or asserted against the Agent or the
Issuing Bank in any way relating to or arising out of any Credit Document or
other Project Contract or any action taken or omitted by the Agent under any
Credit Document or other Project Contract; PROVIDED, HOWEVER, that no Bank shall
be liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent resulting solely from the Agent's gross negligence or willful misconduct.
Without limitation of the foregoing, each Bank agrees to
25
reimburse the Agent promptly upon demand for its ratable share of any costs and
expenses payable by the Company under Section 9.4, to the extent that the Agent
is not reimbursed for such costs and expenses by the Company.
SECTION 8.6 SUCCESSOR AGENT.
The Agent may resign at any time by giving written notice thereof to the
Banks and the Company and may be removed at any time with or without cause with
the written approval of the Required Banks. Upon any such resignation or
removal, the Required Banks shall have the right to appoint a successor Agent
with the consent of the Company, which shall not be unreasonably withheld or
delayed. If no successor Agent has been so appointed by the Required Banks, and
has accepted such appointment, within 30 days after the retiring Agent's giving
of notice of resignation or the Required Banks' removal of the retiring Agent,
then the retiring Agent may, on behalf of the Banks, appoint a successor Agent
with the consent of the Company (which shall not be unreasonably withheld or
delayed), which successor Agent shall be a commercial bank organized under the
laws of the United States of America or of any state thereof and having a
combined capital and surplus of at least $500,000,000. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under the Credit Documents and the
other Project Contracts. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article 8 shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was agent under
this Agreement.
SECTION 8.7 COLLATERAL.
(a) Except as expressly provided herein, the Agent shall have no duty to
take any affirmative steps with respect to the collection of amounts payable in
respect of the Collateral. The Agent shall incur no liability as a result of any
private sale of the Collateral.
(b) The Banks hereby consent, and agree upon written request by the Agent
to execute and deliver such instruments and other documents as the Agent may
deem desirable to confirm such consent, to the release of the Liens on the
Collateral, including any release in connection with any sale, transfer or other
disposition of the Collateral or any part thereof, in accordance with the
Project Contracts.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 AMENDMENTS, ETC.
No amendment or waiver of any provision of this Agreement or any PPA LOC
Loan Note, or consent to any departure by the Company therefrom, shall be
effective unless in writing and signed or consented to (in writing) by the
Required Banks (and, in the case of amendments, the Company), and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; PROVIDED, HOWEVER, that (A) no amendment,
waiver
26
or consent shall, unless in writing and signed or consented to (in writing) by
all of the Banks do any of the following: (i) waive any of the conditions
specified in Article 3; (ii) increase the Commitments of the Banks or subject
the Banks to any additional obligations; (iii) reduce the principal of, or
interest on, the PPA LOC Loans or any fees or other amounts payable hereunder;
(iv) postpone any date fixed for (a) payment of principal of, or interest on,
any PPA LOC Loans, (b) reimbursement of Drawings or (c) payment of fees or other
amounts payable hereunder; (v) change the percentage of the Commitments, or the
number of Banks, required for the Banks or any of them to take any action
hereunder; or (vi) amend this Section 9.1; (B) no amendment, waiver or consent
shall, unless in writing or consented to (in writing) by the Issuing Bank,
affect the rights and obligations of the Issuing Bank hereunder; (C) no
amendment, waiver or consent shall, unless in writing and signed by the Agent in
addition to the Persons required above to take such action, affect the rights or
duties of the Agent under this Agreement or any other Credit Document and (D)
any provision that is a part of this Agreement as a result of an incorporation
by reference to the Indenture shall be amended or waived as provided in Section
2.5 of the Collateral Agency Agreement.
SECTION 9.2 NOTICES, ETC.
All notices and other communications provided for hereunder shall be in
writing (including by telecopier) and shall be mailed, telecopied or delivered,
if to the Company, to it at AES Red Oak, L.LC., 1001 North 19th Street,
Arlington, Virginia 22209, Attention: Project Manager, telephone no. (703)
522-1315, telecopier no. (703) 528-4510; if to any Bank other than the Issuing
Bank, to it at the address or telecopier number set forth below its name in the
Assignment and Acceptance by which it became a party hereto; if to the Agent or
the Issuing Bank, to it at Dresdner Bank AG, New York Branch, 75 Wall Street,
25th Floor, New York, New York 10005-2889, Attention: Project Finance Group,
Michael Higgins, telecopier no. 212-429-2192, telephone no. 212-429-2224, or, as
to each party, to it at such other address or telecopier number as designated by
such party in a written notice to the other parties. All such notices and
communications shall be deemed received, (i) if personally delivered, upon
delivery, (ii) if sent by first-class mail, on the third Business Day following
deposit into the mails and (iii) if sent by telecopier, upon acknowledgment of
receipt thereof by the intended recipient, except that notices and
communications to the Agent pursuant to Article 2 or 8 shall not be effective
until received by the Agent.
SECTION 9.3 NO WAIVER, REMEDIES.
No failure on the part of any Bank (including the Issuing Bank) or the
Agent to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof, and no single or partial exercise of any such right shall
preclude any other or further exercise thereof or the exercise of any other
right. The remedies provided herein are cumulative and not exclusive of any
remedies provided by law.
SECTION 9.4 COSTS AND EXPENSES.
The Company agrees to pay on demand (i) all reasonable costs and expenses
of the Agent and the Banks (including the Issuing Bank) in connection with the
preparation, execution, delivery, syndication, administration, modification and
amendment of this Agreement, any PPA
27
LOC Loan Note, the other Credit Documents and the other documents to be
delivered hereunder, including (a) the reasonable fees and out-of-pocket
expenses of counsel for the Agent and the Banks with respect thereto and with
respect to advising the Agent and the Banks as to their rights and
responsibilities, or the perfection, protection or reservation of rights or
interests, under this Agreement, the other Credit Documents, the other Project
Contracts and the other documents to be delivered hereunder, (b) the reasonable
fees and expenses of any consultants, auditors or accountants engaged by the
Agent with the written consent (which shall not be unreasonably withheld) of the
Company pursuant hereto, and (ii) all reasonable costs and expenses of the Agent
and the Banks (including the Issuing Bank) (including reasonable counsel fees
and expenses of the Agent and the Banks) in connection with the enforcement
(whether through negotiations, legal proceedings or otherwise) of this
Agreement, the other Credit Documents, the other Project Contracts and the other
documents to be delivered hereunder, whether in any action, suit or litigation,
bankruptcy, insolvency or similar proceeding. In addition, the Company shall pay
any and all stamp and other taxes and fees payable or determined to be payable
in connection with the execution, delivery, filing and recording of the
aforementioned documents, and the Company agrees to indemnify and hold the Agent
and the Banks (including the Issuing Bank) harmless from and against any and all
liabilities with respect to or resulting from any delay in paying or omission to
pay any of the foregoing.
SECTION 9.5 APPLICATION OF MONEY.
If any sum paid or recovered in respect of the Obligations is less than the
amount then due, the Agent may apply that sum to principal, interest, fees or
any other amount due under this Agreement in such proportions and order and
generally in such manner as the Agent shall reasonably determine.
SECTION 9.6 SEVERABILITY.
Any provision of this Agreement that is prohibited, unenforceable or not
authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition, unenforceability or nonauthorization without
invalidating the remaining provisions of this Agreement or affecting the
validity, enforceability or authorization of such provision in any other
jurisdiction.
SECTION 9.7 NON-RECOURSE LIABILITY.
Satisfaction of the Obligations shall be had solely from the Collateral.
Notwithstanding any provision to the contrary in the Transaction Documents,
there shall be no recourse against any Affiliates, stockholders, officers,
directors, representatives or employees of the Company, other than the Company
(each a "NON-RECOURSE PARTY"), for any payment due hereunder or under any other
Financing Document or Security Document from the Company or for the performance
of any obligation of such Non-Recourse Party, or breach of any representation or
warranty made by such Non-Recourse Party hereunder or thereunder. The sole
recourse of the Agent and the Banks hereunder or under any other Transaction
Document or for the performance of any obligation of the Company, or breach of
any representation or warranty made hereunder or thereunder by the Company,
shall be against the Company and its assets, it being expressly understood by
the Senior Parties that such obligations are obligations solely of the Company
and
28
that no such personal liability shall attach to, or be incurred by any
Non-Recourse Party; PROVIDED, that nothing contained in this Section 9.7 shall
(i) impair in respect of the Company the validity of any PPA LOC Loan Note, or
any other Credit Documents, as applicable, prevent the taking of any action
permitted by law against the Company or any of its Affiliates, or in any way
affect or impair the rights of the Agent and the Banks to take any action
permitted by law, in either case to realize upon the Collateral, (ii) be deemed
to release the Company or any of its Affiliates, or any past, present or future
shareholder, partner, officer, employee, director or agent of any thereof, from
liability for its fraudulent actions, fraudulent misrepresentations, gross
negligence or willful misconduct or (iii) limit or affect the obligations and
liabilities of any Non-Recourse Party in accordance with the terms of any other
Transaction Document creating such obligations and liabilities to which such
Non-Recourse Party is a party.
SECTION 9.8 BINDING EFFECT.
This Agreement shall be binding upon and inure to the benefit of the
Company, the Agent and the Banks and their respective successors and assigns,
except that the Company shall not have the right to assign any of its rights and
obligations hereunder without the prior written consent of the Required Banks,
and, except as provided in Section 9.9, no Bank other than the Issuing Bank
shall have the right to assign any of its rights and obligations hereunder.
SECTION 9.9 ASSIGNMENTS AND PARTICIPATIONS.
(a) Any Bank may at any time (with the consent of the Company, such consent
not to be unreasonably withheld or delayed, the consent of the Agent, such
consent not to be unreasonably withheld or delayed, and the consent of the
Issuing Bank) sell to one or more banks or other entities whose long-term
unsecured debt is rated at least "A" or the equivalent by S&P and Moody's (a
"PURCHASING BANK") all or any part of its rights and obligations under this
Agreement and the PPA LOC Loan Note (which, except in the case of an assignment
to a Person that, immediately before such assignment, was a Bank, shall be in an
amount equal to not less than the lesser of (x) $5,000,000 and (y) 25% of the
Stated Amount pursuant to an Assignment and Acceptance, executed by such
Purchasing Bank, such transferor Bank, the Agent and the Issuing Bank (and, in
the case of a Purchasing Bank that is not then a Bank or an Affiliate thereof,
by the Company). Upon (i) such execution of such Assignment and Acceptance and
(ii) delivery of a copy thereof to the Company and payment of the amount of its
participation to the Agent or such transferor Bank, such Purchasing Bank shall
for all purposes be a Bank party to this Agreement and shall have all the rights
and obligations of a Bank under this Agreement, to the same extent as if it were
an original party hereto with the Percentage Interest as set forth in such
Assignment and Acceptance, which shall be deemed to amend this Agreement to the
extent, and only to the extent, necessary to reflect the addition of such
Purchasing Bank and the resulting adjustment of Percentage Interests arising
from the purchase by such Purchasing Bank of all or a portion of the rights and
obligations of such transferor Bank under this Agreement and the PPA LOC Loan
Note.
(b) Any Bank may, from time to time, sell or offer to sell participating
interests in any PPA LOC Loans owing to such Bank, such Bank's interest in any
PPA LOC Loan Note, any Commitment of such Bank or any other interests and
obligations of such Bank hereunder, to one or more banks or other entities
(each, a "PARTICIPANT"), on such terms and conditions as may be
29
determined by the selling Bank, without the consent of or notice to the Company,
and the grant of such participation shall not relieve any Bank of its
obligations, or impair the rights of any Bank, hereunder. In the event of any
such sale by a Bank of a participating interest to a Participant, such Bank
shall remain solely responsible for the performance of such Bank's obligations
under this Agreement, the Company, the Agent and the Issuing Bank will continue
to deal solely and directly with such Bank in connection with such Bank's rights
and obligations under this Agreement and such Bank shall retain the sole right
and responsibility to exercise the rights of such Bank, and enforce the
obligations of the Company, including the right to approve any amendment,
modification, supplement or waiver of any provision of any Credit Document and
the right to take action under Article 6 hereof and such Bank shall not grant
any such Participant any voting rights or veto power over any such action by
such Bank under this Agreement (PROVIDED, that such Bank may agree not to
consent to any modification, amendment or waiver of this Agreement, without the
consent of the Participant, that would alter the principal of or interest on any
PPA LOC Loans, postpone the date fixed for any payment of principal of or
interest thereon or extend the term of any Commitment). No Participant shall
have any rights under this Agreement to receive payment of principal, interest
or any other amount payable hereunder except through a Bank and as provided in
this Section 9.9. The Company agrees that, upon the occurrence and during the
continuance of any Event of Default, each Participant shall have the right of
set-off in respect of its participating interest in amounts owing under this
Agreement and any PPA LOC Loan Note as set forth in Section 2.21 hereof to the
same extent as if the amount of its participating interest was owing directly to
it as a Bank under this Agreement or any PPA LOC Loan Note. The Company also
agrees that each Participant shall be entitled to the benefits of Sections 2.15,
2.16, 2.17 and 2.18 hereof with respect to its participation granted hereunder;
PROVIDED, that no Participant shall be entitled to receive any greater amount
pursuant to such Sections than the Bank transferring such participation would
have been entitled to receive in respect of the amount of the participation
transferred to such Participant had no such transfer occurred.
(c) Any Bank may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 9.9, disclose to
the Purchasing Bank or Participant or proposed Purchasing Bank or Participant
any information relating to the Company furnished to such Bank by or on behalf
of the Company; PROVIDED, HOWEVER, that prior to any such disclosure, the Person
receiving such disclosure shall sign such confidentiality agreements as the
Company may reasonably request.
SECTION 9.10 INDEMNIFICATION.
The Company agrees to indemnify, on demand, and hold harmless the Agent and
each Bank (including the Issuing Bank) and each of their respective officers,
directors, employees, agents and affiliates from and against any and all claims,
damages, losses, liabilities, costs and expenses whatsoever that such
indemnified party may incur (or that may be claimed against such indemnified
party by any Person) by reason of (i) any untrue statement or alleged untrue
statement of any material fact concerning the Company or the Collateral, or the
omission or alleged omission to state any fact concerning the Company or the
Collateral necessary to make any such statement, in light of the circumstances
under which it was made, not misleading; (ii) the issuance, sale or delivery of
the Senior Debt; (iii) the use of the proceeds of the Senior Debt or any
Drawing; (iv) any reasonable action taken by such indemnified party in
protecting
30
and enforcing the rights and remedies of the Agent and the Banks under the
Project Contracts; (v) subject to Section 7.2, the execution, delivery or
transfer of, or payment or failure to pay under, the PPA Letter of Credit; (vi)
any claim of any Person with respect to any finder's fee, brokerage commission
or other similar sum due in connection with any Project Contract; or (vii) any
failure by the Company to comply with any Environmental Requirement; PROVIDED,
HOWEVER, that the Company shall not be required to indemnify the Issuing Bank
for any claims, damages, losses, liabilities, costs or expenses to the extent
caused by the Issuing Bank's willful misconduct or gross negligence in paying
under the PPA Letter of Credit or the Issuing Bank's willful or grossly
negligent failure to pay under the PPA Letter of Credit after the presentation
to it by the beneficiary of a draft and certificate strictly complying with the
terms and conditions of the PPA Letter of Credit (unless the Issuing Bank in
good faith believed itself (based upon an opinion of counsel) to be prohibited
by law or legal authority from making such payment). The Company, upon demand by
any party indemnified or intended to be indemnified pursuant to this Section
9.10 at any time, shall also reimburse such party for any reasonable legal or
other expenses incurred in connection with investigating or defending against
any of the foregoing. If any action, suit or proceeding arising from any of the
foregoing is brought against any party indemnified or intended to be indemnified
pursuant to this Section 9.10 (an "INDEMNIFIED PARTY"), such Indemnified Party
shall promptly notify the Company in writing, enclosing a copy of all papers
served, but the omission so to notify the Company of any such action shall not
relieve it of any liability that it may have to any Indemnified Party otherwise
than under this Section 9.10; PROVIDED, HOWEVER, that the Company shall not be
liable for any settlement of any such action effected without the Company's
prior written consent. In case any such action shall be brought against any
Indemnified Party and it shall notify the Company of the commencement thereof,
the Company shall be entitled to participate in and, to the extent that it shall
wish, to assume the defense thereof with counsel reasonably satisfactory to such
Indemnified Party, and after notice from the Company to such Indemnified Party
of the Company's election so to assume the defense thereof, the Company shall
not be liable to such Indemnified Party for any subsequent legal or other
expenses attributable to such defense, except as provided below, other than
reasonable costs of investigation subsequently incurred by such Indemnified
Party in connection with the defense thereof. The Indemnified Party shall have
the right to employ its own counsel in any such action, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party
unless (i) the employment of counsel by such Indemnified Party has been
authorized by the Company, (ii) the Indemnified Party shall have reasonably
concluded that there may be a conflict of interest between the Company and the
Indemnified Party in the conduct of the defense of such action (in which case
the Company shall not have the right to direct the defense of such action on
behalf of the Indemnified Party) or counsel for the Company shall have declined
to represent the Indemnified Party in light of a potential conflict of interest
or (iii) the Company shall not in fact have employed counsel reasonably
satisfactory to the Indemnified Party to assume the defense of such action.
SECTION 9.11 GOVERNING LAW; SUBMISSION OF JURISDICTION; VENUE; WAIVER OF
JURY TRIAL.
(a) THE RIGHTS AND OBLIGATIONS OF EACH OF THE PARTIES UNDER THIS AGREEMENT
AND ANY PPA LOC LOAN NOTE SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1401, BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
31
ANY LEGAL ACTION OR PROCEEDING AGAINST THE COMPANY WITH RESPECT TO THIS
AGREEMENT, ANY PPA LOC LOAN NOTE OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN
THE COURTS OF THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF NEW YORK AND, BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, THE COMPANY HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT
OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION
OF THE AFORESAID COURTS. THE COMPANY HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND
EMPOWERS CT CORPORATION SYSTEM, WITH OFFICES ON THE DATE HEREOF AT 111 EIGHTH
AVENUE, NEW YORK, NY 10011, AS ITS DESIGNEE, APPOINTEE AND AGENT WITH RESPECT TO
ANY ACTION OR PROCEEDING IN NEW YORK TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND
ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL
PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION
OR PROCEEDING AND AGREES THAT THE FAILURE OF SUCH AGENT TO GIVE ANY ADVICE OF
ANY SUCH SERVICE OF PROCESS TO THE COMPANY SHALL NOT IMPAIR OR AFFECT THE
VALIDITY OF SUCH SERVICE OR OF ANY CLAIM BASED THEREON. IF FOR ANY REASON SUCH
DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, THE
COMPANY AGREES TO DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY
ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO THE AGENT.
THE COMPANY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF
THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF
COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE COMPANY
AT ITS ADDRESS SET FORTH IN SECTION 9.2, SUCH SERVICE TO BECOME EFFECTIVE 30
DAYS AFTER SUCH MAILING.
(b) THE COMPANY HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, ANY PPA LOC
LOAN NOTE OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN
SECTION 9.11(a) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO
PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
ANY OF THIS AGREEMENT, ANY PPA LOC LOAN NOTE OR THE CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
32
SECTION 9.12 HEADINGS.
The section and subsection headings used herein have been inserted for
convenience of reference only and do not constitute matters to be considered in
interpreting this Agreement.
SECTION 9.13 EXECUTION IN COUNTERPARTS.
This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
33
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written.
AES RED OAK, L.L.C.
By: /s/ Louis J. Anatrella
-------------------------
Name: Louis J. Anatrella
Title: Vice President
Initial
COMMITMENT PERCENTAGE INTEREST
$30,000,000.00 100% DRESDNER BANK AG, acting through its New York Branch, as
Agent, as Issuing Bank and as a Bank
By: /s/ Thomas Lake
-------------------------------------------
Name: Thomas Lake
Title: Vice President
By: /s/ Andrew Schroeder
-------------------------------------------
Name: Andrew Schroeder
Title: Vice President
[PPA LETTER OF CREDIT AND REIMBURSEMENT AGREEMENT]
EXHIBIT A
FORM OF PPA LETTER OF CREDIT
----------------------------
ISSUING BANK: Letter of Credit No. [ ]
Dresdner Bank AG, acting through its New Irrevocable Standby Credit
York Branch
75 Wall Street
New York, New York 10005
Date and Place of Issue: Date and Place of Expiry:
New York, New York Dresdner Bank AG,
March 15, 2000 New York Branch
New York, New York
March 15, 2007 as the same may be
extended from time to time in
accordance with the terms hereof
Applicant:
AES Red Oak, L.L.C.
1001 North 19th Street
Arlington, Virginia 22209
Amount: Up to an aggregate of
Thirty Million United States Dollars
(US$30,000,000) prior to the
Commercial Operation Date and up
to Ten Million United States
Dollars (US$10,000,000) thereafter
until the Expiry Date
Beneficiary:
Williams Energy Marketing & Trading Credit Available With:
Company Dresdner Bank AG, acting through its
One Williams Center New York Branch
Tulsa, OK 74101-9567 By: Negotiation, Against
Presentation of the Documents Detailed
Herein, Drawn on
Dresdner Bank AG, acting through its
New York Branch
Ladies and Gentlemen:
We irrevocably authorize you to draw on us for the account of the Applicant up
to an aggregate amount of THIRTY MILLION UNITED STATES DOLLARS (US$30,000,000)
prior to the Commercial Operation Date, as such term is defined in the
Indenture, and on or after the Commercial Operation Date, an amount equal to the
lesser of (a) US$10,000,000 and (b) US$30,000,000 less all amounts drawn under
the Letter of Credit and not reimbursed to the Issuing Bank prior to the
Commercial Operation Date (the "STATED AMOUNT") available against presentation
of a dated drawing request drawn on Dresdner Bank AG, acting through its New
Ex. A-1
York Branch, manually signed by an authorized officer of the Beneficiary (who is
identified as such) appropriately completed in the form of Annex 1-A or Annex
1-B hereto, as applicable.
The above drawing request shall be in writing, addressed to us at Dresdner Bank
AG, New York Branch, 75 Wall Street, New York, NY 10005, Attn: Mei Zheng, Credit
Administration Department, telecopier no. 212-429-2130, and all other
communications with respect to this Letter of Credit shall be in writing
addressed to us at Dresdner Bank AG, New York Branch, 75 Wall Street, New York,
NY 10005, Attn: Mei Zheng, Credit Administration Department, telecopier no.
212-429-2130, with a copy to Dresdner Bank AG, New York Branch, 75 Wall Street,
New York, NY 10005, Attn: Andrew Cullinan, Portfolio Management Group,
telecopier no. 212-429-2192, referencing this Letter of Credit No. [ ] and
presented to us by delivery in person or facsimile transmission at such address,
provided that the original of the above drawing request or such communications,
as the case may be, shall be sent to us at such address by overnight courier for
receipt by us within two (2) Business Days of the date of any such facsimile
transmission.
If the drawing request is presented in compliance with the terms of this Letter
of Credit to us at such address by 12:00 noon New York City time on any Business
Day, payment will be made no later than 3:00 p.m. New York City time on such
Business Day and if such drawing request is so presented to us after 12:00 noon
New York City time on any Business Day, payment will be made no later than 12:00
noon New York City time on the following Business Day. Payment under this Letter
of Credit shall be made in immediately available funds by wire transfer to such
account as may be designated by the Beneficiary in the applicable drawing
request.
As used in this Letter of Credit, "Business Day" means any day on which
commercial banks located in New York, New York are not required or authorized to
remain closed.
This Letter of Credit shall automatically terminate and be delivered to us for
cancellation upon the earliest of (i) the close of business on March 15, 2007;
(ii) the thirtieth (30th) day (or a later day specified in the written notice
described below) after delivery in person or by facsimile transmission (with
written confirmation by overnight courier for receipt within two (2) Business
Days) to the Power Purchaser (as defined under the Reimbursement Agreement
referred to below) (addressed to Williams Energy Marketing & Trading Company,
One Williams Center, Tulsa, OK 74101-9567, Attn: Contract Management, telecopier
no. 918-594-1935) of a notice in the form of Annex 2 hereto stating that this
Letter of Credit will terminate in 30 days (or such later date specified in such
written notice) by reason of an "Event of Default" having occurred under the
Power Purchase Agreement Letter of Credit and Reimbursement Agreement, dated as
of March 1, 2000, among the Applicant, the Issuing Bank and the other Banks
party thereto and Dresdner Bank AG, acting through its New York Branch, as Agent
(the "Agent") (the "Reimbursement Agreement"), PROVIDED that, prior to such
termination the Beneficiary is authorized to draw on us prior to such
termination the Stated Amount of this Letter of Credit by presentation to us, in
the manner and the address specified in the third preceding paragraph, of a
drawing request appropriately completed in the form of Annex 1-A or Annex 1-B
hereto, as applicable, and signed by the Beneficiary's authorized officer; and
(iii) our receipt of a certificate signed by an authorized agent of the
Applicant requesting termination of this Letter of Credit by reason of delivery
of substitute collateral under the Power Purchase Agreement (the earliest of
such dates, the "Expiry Date").
Ex. A-2
Unless terminated earlier in accordance with the provisions hereof, the date of
expiry set forth hereinabove (the "Stated Expiration Date") may be extended for
a period of one or more years at the option of the Agent effective upon the
Stated Expiration Date (each expiration date of any extension being referred to
as the "New Stated Expiration Date") upon notice of such extension given by
Dresdner Bank AG, acting through its New York Branch, to the Power Purchaser (as
defined under the Reimbursement Agreement) by delivery in person or facsimile
transmission (with written confirmation by overnight courier for receipt by the
Power Purchaser within two (2) Business Days addressed to Williams Energy
Marketing & Trading Company, One Williams Center, Tulsa, OK 74101-9567, Attn:
Contract Management), on or before the date that is forty-five (45) days prior
to the Stated Expiration Date or any such New Stated Expiration Date.
This Letter of Credit is effective immediately.
In the event that a drawing request fails to comply with the terms of this
Letter of Credit, we shall provide the Beneficiary prompt notice of same stating
the reasons therefor and shall upon your instructions hold any non-conforming
drawing request and other documents at your disposal or return any
non-conforming drawing request and other documents to the Beneficiary at the
address set forth above by delivery in person or facsimile transmission (with
originals thereof sent by overnight courier for receipt within two (2) Business
Days). Upon being notified that the drawing was not effected in compliance with
this Letter of Credit, the Beneficiary may attempt to correct such non-complying
drawing request prior to the Expiry Date in accordance with the terms of this
Letter of Credit.
This Letter of Credit sets forth in full the terms of our undertaking and this
undertaking shall not in any way be modified, amended, limited or amplified by
reference to any document, instrument or agreement referred to herein, except
only defined terms used herein and the drawing requests and certificates
referred to herein; and any such reference shall not be deemed to incorporate
herein by reference any document, instrument, or agreement except for such
defined terms, drawing requests and certificates.
This Letter of Credit may be assigned upon presentation to us of a signed
transfer certificate in the form of Annex 3 accompanied by this Letter of
Credit, in which the Beneficiary irrevocably transfers to such transferee all of
its rights hereunder, whereupon we agree to either issue a substitute letter of
credit to such successor or endorse such transfer on the reverse of this Letter
of Credit.
We authorize you to make not more than one drawing prior to the Commercial
Operation Date and not more than one drawing on or after the Commercial
Operation Date, in each case upon the terms of this Letter of Credit.
All banking charges, including any advising and negotiating bank charges, are
for the account of the Applicant.
Ex. A-3
All drawing requests under this Letter of Credit must bear the clause:
"Drawn under Dresdner Bank AG, acting through its New York
Branch, Letter of Credit No. [ ] dated March 15, 2000."
This Letter of Credit shall not be amended except with the written concurrence
of Dresdner Bank AG, New York Branch, the Applicant and the Beneficiary.
We hereby engage with you that a drawing request drawn strictly in compliance
with the terms of this Letter of Credit and amendments thereto shall meet with
due honor upon presentation.
This Letter of Credit is subject to the International Standby Practices of the
International Chamber of Commerce ("ISP98"). This Letter of Credit shall be
deemed to be a contract made under the laws of the State of New York and shall,
as to matters not governed by ISP98, be governed by and construed in accordance
with the laws of such State, other than its conflict of laws rules that would
result in the application of the law of any jurisdiction other than the laws of
such State.
We irrevocably agree with you that any legal action or proceeding with respect
to this Letter of Credit shall be brought in the courts of the State of New York
in the County of New York or of the United States of America in the Southern
District of New York. By signing this Letter of Credit, we irrevocably submit to
the jurisdiction of such courts solely for the purposes of this Letter of
Credit. We hereby waive, to the fullest extent permitted by law, any objection
we may now or hereafter have to the laying of venue in any such action or
proceeding in any such court.
DRESDNER BANK AG, acting through its
New York Branch
By:
-------------------------------------------
Authorized Signature
By:
-------------------------------------------
Authorized Signature
Ex. A-4
ANNEX 1-A
DRAWING REQUEST
[Date]
"DRAWN UNDER DRESDNER BANK AG, ACTING THROUGH ITS
NEW YORK BRANCH,
LETTER OF CREDIT NO. [ ] IRREVOCABLE STANDBY LETTER OF CREDIT
DATED MARCH 15, 2000."
Dresdner Bank AG,
New York Branch
75 Wall Street
New York, NY 10005
Attn: Mei Zheng,
Credit Administration Department
cc: Michael Higgins
Ladies and Gentlemen:
The undersigned hereby draws on Dresdner Bank AG, acting through its New York
Branch, Letter of Credit No. [ ] Irrevocable Standby Letter of Credit (the
"LETTER OF CREDIT"), dated March 15, 2000, issued by you in favor of us. Any
capitalized term used herein and not defined herein shall have its respective
meaning as set forth in the Letter of Credit.
In connection with this drawing, we hereby certify that:
A. "This drawing in the amount of US$_________ is being made pursuant to
Dresdner Bank AG, acting through its New York Branch, Letter of Credit No.
[ ] Irrevocable Standby Letter of Credit issued to Williams Energy
Marketing & Trading Company ("WILLIAMS") pursuant to Section 18.2 of the
Fuel Conversion Services, Capacity and Ancillary Services Agreement dated
September 17, 1999, by and between AES Red Oak, L.L.C. and Williams (as the
same may be amended, supplemented or modified from time to time, the "POWER
PURCHASE AGREEMENT")"; and
B. "The Facility has not achieved the Commercial Operation Date by the date
specified in Section 2.2 of the Power Purchase Agreement (each capitalized
term being used as defined in the Power Purchase Agreement)"; and
C. "The amount requested to be drawn does not exceed the Stated Amount"; and
D. "You are directed to make payment of the requested drawing to account no.
____________ at ____________________________ [insert bank name, address and
account number]."
1-A--1
IN WITNESS WHEREOF, the undersigned has executed and delivered this request on
this _____ day of _______________, 200_.
WILLIAMS ENERGY MARKETING & TRADING COMPANY
By:
-------------------------------------------
Name:
Title:
1-A--2
ANNEX 1-B
DRAWING REQUEST
[Date]
"DRAWN UNDER DRESDNER BANK AG, ACTING THROUGH ITS
NEW YORK BRANCH,
LETTER OF CREDIT NO. [ ] IRREVOCABLE STANDBY LETTER OF CREDIT
DATED MARCH 15, 2000."
Dresdner Bank AG,
New York Branch
75 Wall Street
New York, NY 10005
Attn: Mei Zheng,
Credit Administration Department
cc: Michael Higgins
Ladies and Gentlemen:
The undersigned hereby draws on Dresdner Bank AG, acting through its New York
Branch, Letter of Credit No. [ ] Irrevocable Standby Letter of Credit (the
"LETTER OF CREDIT"), dated March 15, 2000, issued by you in favor of us. Any
capitalized term used herein and not defined herein shall have its respective
meaning as set forth in the Letter of Credit.
In connection with this drawing, we hereby certify that:
A. "This drawing in the amount of US$_________ is being made pursuant to
Dresdner Bank AG, acting through its New York Branch, Letter of Credit No.
[ ] Irrevocable Standby Letter of Credit issued to Williams Energy
Marketing & Trading Company ("WILLIAMS") pursuant to Section 18.2 of the
Fuel Conversion Services, Capacity and Ancillary Services Agreement dated
September 17, 1999, by and between AES Red Oak, L.L.C. ("AES") and Williams
(as the same may be amended, supplemented or modified from time to time,
the "POWER PURCHASE AGREEMENT")"; and
B. "The Commercial Operation Date has occurred"; and
C. "An event of default by AES has occurred under the Power Purchase Agreement
permitting Williams to terminate the Power Purchase Agreement"; and
D. "The amount requested to be drawn does not exceed the amount owed by AES
Red Oak, L.L.C. pursuant to the terms of the Power Purchase Agreement and
does not exceed the Stated Amount"; and
E. "The requested drawing does not include any amount in respect of amounts
which Williams has agreed to subordinate to debt service under the terms of
the Power Purchase Agreement at any time AES has debt obligations
outstanding."
1-B--1
F. "You are directed to make payment of the requested drawing to account no.
____________ at ____________________________ [insert bank name, address and
account number]."
IN WITNESS WHEREOF, the undersigned has executed and delivered this request
on this _____ day of _______________, 200_.
WILLIAMS ENERGY MARKETING & TRADING COMPANY
By:
-------------------------------------------
Name:
Title:
1-B--2
ANNEX 2
NOTICE OF TERMINATION OF LETTER OF CREDIT
[Date]
Williams Energy Marketing & Trading Company
One Williams Center
Tulsa, OK 74101-9567
Attn: Contract Management
Ladies and Gentlemen:
Reference is made to Dresdner Bank AG, acting through its New York Branch,
Letter of Credit No. [ ] Irrevocable Standby Letter of Credit (the "LETTER OF
CREDIT"), dated March 15, 2000, issued by us in favor of Williams Energy
Marketing & Trading Company.
This constitutes our notice to you pursuant to the Letter of Credit that the
Letter of Credit shall terminate on ___________, 200_ [insert a date which is 30
or more days after the date of this notice of termination (the "TERMINATION
DATE")].
Pursuant to the terms of the Letter of Credit, you are authorized to draw, in a
single drawing, prior to the Termination Date, on the Letter of Credit in an
amount that does not exceed the Stated Amount (as defined in the Letter of
Credit).
Very truly yours,
DRESDNER BANK AG, acting through its New York
Branch
By:
-------------------------------------------
Name:
Title:
By:
-------------------------------------------
Name:
Title:
2--1
ANNEX 3
TRANSFER OF LETTER OF CREDIT
[Date]
"DELIVERED UNDER DRESDNER BANK AG, ACTING THROUGH ITS NEW YORK BRANCH
LETTER OF CREDIT NO. [ ]
DATED MARCH 15, 2000."
Dresdner Bank AG,
New York Branch
75 Wall Street
New York, New York 10005
Attn: Mei Zheng,
Credit Administration Department
cc: Michael Higgins
Gentlemen:
Reference is made to Dresdner Bank AG, acting through its New York Branch,
Letter of Credit No. [ ] Irrevocable Standby Letter of Credit, dated March 15,
2000, originally issued by you in favor of Williams Energy Marketing & Trading
Company (the "LETTER OF CREDIT"). Any capitalized terms used, but not defined
herein, shall have its respective meaning as set forth in the Letter of Credit.
For value received, the undersigned, as Beneficiary under the Letter of Credit,
hereby irrevocably transfers to _____________ (the "TRANSFEREE") all rights of
the undersigned to draw under the Letter of Credit in their entirety.
The Transferee is the successor to the Beneficiary, as Power Purchaser under the
Fuel Conversion Services, Capacity and Ancillary Services Agreement dated
September 17, 1999, by and between AES Red Oak, L.L.C. and the Beneficiary, (as
the same may be amended, supplemented or modified from time to time, the "POWER
PURCHASE AGREEMENT") and all conditions to appointment of such successor set
forth in the Power Purchase Agreement have been satisfied.
By this transfer, all rights of the undersigned, as Beneficiary under the Letter
of Credit, are transferred to the Transferee, and the Transferee shall have the
sole rights with respect to the Letter of Credit relating to any amendments
thereof and any notices thereunder. All amendments to the Letter of Credit are
to be consented to by the Transferee without necessity of any consent of or
notice to the undersigned.
Simultaneously with the delivery of this notice to you, copies of this notice
are being transmitted to the Transferee.
3--1
The Letter of Credit is returned herewith, and we ask you to either issue a
substitute letter of credit for the benefit of the Transferee or endorse the
transfer on the reverse thereof, and forward it directly to the Transferee with
your customary notice of transfer.
Very truly yours,
WILLIAMS ENERGY MARKETING & TRADING COMPANY
By:
-------------------------------------------
Name:
Title:
3--2
EXHIBIT B
FORM OF
PPA LOC LOAN PROMISSORY NOTE
----------------------------
$30,000,000.00 New York, New York
March 15, 2000
FOR VALUE RECEIVED, the undersigned, AES Red Oak, L.L.C., a Delaware limited
liability company (the "COMPANY"), hereby unconditionally promises to pay to the
order of Dresdner Bank AG, acting through its New York Branch (the "AGENT") for
the benefit of the Banks party from time to time to the Reimbursement Agreement
referred to below the lesser of (i) the principal sum of Thirty Million Dollars
($30,000,000.00) and (ii) the aggregate unpaid principal amount of the PPA LOC
Loans owing to the Banks by the Company under the Reimbursement Agreement, on
the dates and in the amounts specified therein.
The Company further promises to pay interest on the daily unpaid principal
amount hereof from time to time outstanding on the dates and at the rates
specified in the Reimbursement Agreement. This PPA LOC Loan Note is hereby
expressly limited so that in no contingency or event, whether by reason of
acceleration of the maturity of any indebtedness evidenced hereby or otherwise,
shall the interest contracted for or charged or received by the Agent for the
account of the Banks exceed the maximum amount permissible under Applicable Law.
If, from any circumstance whatsoever, interest would otherwise be payable to the
Agent for the account of the Banks in excess of the maximum lawful amount, the
interest payable to the Agent for the account of the Banks shall be reduced to
the maximum amount permitted under Applicable Law, and the amount of interest
for any subsequent period, to the extent less than that permitted by Applicable
Law, shall to that extent be increased by the amount of such reduction.
The holder hereof is irrevocably authorized to endorse on the schedule attached
hereto, or on a continuation thereof, the date each such interest payment is due
and the amount of each such interest payment determined in accordance with the
Reimbursement Agreement. All such notations shall constitute PRIMA FACIE
evidence of the accuracy of the information so recorded and be enforceable
against the Company with the same force and effect as if such amounts were each
set forth in a separate PPA LOC Loan Note executed by the Company.
All payments due hereunder shall be made without set-off, counterclaim or
deduction of any nature to the Agent, for the account of the Banks, in lawful
money of the United States of America and in immediately available funds, at
such place and in such manner as may be specified by the Agent pursuant to the
Reimbursement Agreement.
The holder hereof is irrevocably authorized to endorse on the schedule attached
hereto, or on a continuation thereof, the date and amount of each PPA LOC Loan
incurred by the Company and each payment or prepayment of principal thereof,
provided that the failure of the holder to make, or any error in making, any
such recordation or endorsement shall not affect the obligations of the Company
hereunder or under the Reimbursement Agreement. All such notations shall
constitute PRIMA FACIE evidence of the accuracy of the information so recorded
and be
Ex.B--1
enforceable against the Company with the same force and effect as if such
amounts were each set forth in a separate PPA LOC Loan Note executed by the
Company.
This PPA LOC Loan Note is the "PPA LOC Loan Note" of the Company to the Agent,
for the benefit of the Banks, referred to in, evidences each PPA LOC Loan owing
to the Banks by the Company under, is subject to the provisions of, and entitles
the holder to the benefits of, the Power Purchase Agreement Letter of Credit and
Reimbursement Agreement, dated as of March 1, 2000 (the "REIMBURSEMENT
AGREEMENT"), among the Company, the Banks (including the Issuing Bank) parties
thereto, and the Agent, as the same may be amended, supplemented or otherwise
modified from time to time and to which reference is hereby made for a more
complete statement of the terms and conditions under which each PPA LOC Loan
evidenced hereby is to be incurred and paid. Capitalized terms in this PPA LOC
Loan Note that are not specifically defined herein shall have the meanings
ascribed to them in the Reimbursement Agreement.
The Reimbursement Agreement provides for, among other things, the acceleration
of the maturity of the unpaid principal amount hereof upon the occurrence of
certain stated events and for voluntary prepayments in certain circumstances and
upon certain terms and conditions. The obligations of the Company under the
Reimbursement Agreement and this PPA LOC Loan Note are secured by, and the
holder hereof is entitled to the benefit of, the Security Documents.
In addition to any and all costs, fees and expenses for which the Company is
liable under the Reimbursement Agreement, the Company promises to pay all costs
and expenses, including reasonable attorneys' fees and disbursements, incurred
in the collection and enforcement hereof or any appeal of any judgment rendered
hereon.
The Company hereby expressly waives diligence, presentment, protest, demand,
dishonor, nonpayment and notice of every kind to the fullest extent permitted by
Applicable Law. No failure or delay by the holder of this PPA LOC Loan Note to
exercise any right or remedy under this PPA LOC Loan Note or any other document
or instrument entered into pursuant to the Reimbursement Agreement shall operate
or be construed as a waiver or modification hereof or thereof.
This PPA LOC Loan Note shall be binding upon the successors and assigns of the
Company and shall inure to the Agent and its successors, endorsees and assigns.
If any term or provision of this PPA LOC Loan Note shall be held invalid,
illegal or unenforceable, the validity of all other terms and provisions hereof
shall in no way be affected thereby.
Recourse under this PPA LOC Loan Note is limited in accordance with Section 9.7
of the Reimbursement Agreement, and the provisions of said Section 9.7 are
incorporated herein by reference.
THIS PPA LOC LOAN NOTE SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1401, BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING AGAINST THE COMPANY WITH
RESPECT TO THIS PPA LOC LOAN NOTE MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW
Ex.B--2
YORK IN THE COUNTY OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK AND, BY EXECUTION AND DELIVERY OF THIS PPA LOC LOAN NOTE,
THE COMPANY HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS
OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS PPA LOC LOAN NOTE
BROUGHT IN THE COURTS REFERRED TO ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES
AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
AES RED OAK, L.L.C.
By:
-------------------------------------------
Name:
Title:
Ex.B--3
SCHEDULE
Principal Amount and Date Total Principal
Date Amount of of Principal Unpaid Date Interest Amount of PPA LOC
Loan MADE Reimbursement Paid or Prepaid Principal Payment is Due Amount of Loans Outstanding Notation
Obligation Balance Interest Due Made By
Ex.B--4
EXHIBIT C
FORM OF ASSIGNMENT AND ACCEPTANCE
---------------------------------
Dated __________, 200_
Reference is made to the Power Purchase Agreement Letter of Credit and
Reimbursement Agreement, dated as of March 1, 2000 (the "REIMBURSEMENT
AGREEMENT"), among AES Red Oak, L.L.C., a Delaware limited liability company
(the "COMPANY"), the Issuing Bank (as defined in the Reimbursement Agreement),
the Banks (as defined in the Reimbursement Agreement) and Dresdner Bank AG,
acting through its New York Branch, as Agent for the Banks (the "AGENT"). Terms
defined in the Reimbursement Agreement are used herein with the same meaning.
_________________ (the "ASSIGNOR") and ___________________ (the "ASSIGNEE")
agree as follows:
(1) The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, the percentage
interest specified on Schedule 1 hereto in and to all of the Assignor's
rights and obligations under the Reimbursement Agreement as of the date
hereof (after giving effect to any other assignments thereof made before
the date hereof, whether or not such assignments have become effective, but
without giving effect to any other assignments thereof also made on the
date hereof), including, without limitation, such percentage interest in
the Assignor's Commitment, each of the PPA LOC Loans owing to the Assignor
and the PPA Letter of Credit. The Assignee shall pay to the Assignor, at or
before 12:00 noon, local time of the Assignor, on the Effective Date, the
purchase price therefor in an amount equal to the percentage interest of
the PPA LOC Loans owing to the Assignor, as reflected on Schedule 1 hereto,
in immediately available funds.
(2) The Assignor (a) represents and warrants that as of the date
hereof its Commitment, the PPA LOC Loans owing to it and its participation
in the PPA Letter of Credit (after giving effect to any other assignments
of the foregoing made before the date hereof, whether or not such
assignments have become effective, but without giving effect to any other
such assignments also made on the date hereof) are in the respective dollar
amounts specified therefor on Schedule 1 hereto; (b) represents and
warrants that it is the legal and beneficial owner of the interest being
assigned by it hereunder and that such interest is free and clear of any
adverse claim; (c) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with any of the Credit Documents
or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of any of the Credit Documents or any other instrument
or document furnished pursuant thereto; and (d) makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of the Company or the performance or observance by the
Ex.C--1
Company or any other Person of any of its obligations under any of the
Credit Documents or any other instrument or document furnished pursuant
thereto.
(3) The Assignee (a) confirms that it has received copies of the
Credit Documents and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance, including such documents evidencing satisfaction
of the conditions precedent set forth in the Reimbursement Agreement; (b)
agrees that it will, independently and without reliance upon the Agent, the
Assignor or any other Bank (including the Issuing Bank) and based on such
documents and information as it may deem appropriate at the time, continue
to make its own credit decisions in taking or not taking action under the
Reimbursement Agreement; (c) appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Documents as are delegated to the Agent by the terms thereof, together with
such powers as are reasonably incidental thereto; (d) agrees that it will
perform in accordance with their terms all of the obligations that by the
terms of the Reimbursement Agreement are required to be performed by it as
a Bank; and (e) specifies as its address for notices the address set forth
beneath its name on Schedule 1 hereto.
(4) Following the execution of this Assignment and Acceptance by the
Assignor and the Assignee, it will be delivered to the Agent for acceptance
and recording by the Agent in the register maintained by the Agent for such
purpose. The effective date of this Assignment and Acceptance shall be the
date of acceptance thereof by the Agent, unless otherwise specified on
Schedule 1 hereto (the "EFFECTIVE DATE").
(5) Upon such acceptance and recording by the Agent, as of the
Effective Date (a) the Assignee shall be a party to the Reimbursement
Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Bank thereunder and (b) the Assignor
shall, to the extent provided in this Assignment and Acceptance, relinquish
its rights and be released from its obligations under the Reimbursement
Agreement.
(6) Upon such acceptance and recording by the Agent, from and after
the Effective Date the Agent shall make all payments under the
Reimbursement Agreement in respect of the interest assigned hereby
(including, without limitation, all payments of principal, interest and
fees with respect thereto) to the Assignee. The Assignor and the Assignee
shall make all appropriate adjustments directly between themselves in
respect of payments of principal, interest and/or fees under the
Reimbursement Agreement for periods before the Effective Date.
(7) Each of the Assignor and the Assignee agrees that at any time and
from time to time upon the written request of the other party, it will
execute and deliver such further documents and do such further acts and
things as the other party may reasonably request in order to effect the
purposes of this Assignment and Acceptance.
(8) THE RIGHTS AND OBLIGATIONS OF EACH OF THE PARTIES UNDER THIS
ASSIGNMENT AND ACCEPTANCE SHALL, PURSUANT TO NEW
Ex.C--2
YORK GENERAL OBLIGATIONS LAW SECTION 5-1401, BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(9) This Assignment and Acceptance is executed by the parties on
Schedule 1 hereto and may be executed in one or more counterparts, each of
which shall be deemed an original and all of which together shall
constitute one and the same document. Execution of this Assignment and
Acceptance by the Agent and the Company on Schedule 1 hereto shall
constitute any consent of such Person required pursuant to Section 9.9 of
the Reimbursement Agreement.
[ASSIGNOR]
By:
------------------------------------------
Name:
Title:
By:
------------------------------------------
Name:
Title:
[ASSIGNEE]
By:
------------------------------------------
Name:
Title:
[address for notices]
Consented to on this _____ day of __________, 200__:
[DRESDNER BANK AG, acting through its
New York Branch],
as Agent and as Issuing Bank
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
Ex.C--3
Consented to on this _____ day of __________, 200__:
AES RED OAK, L.L.C.
By:
-------------------------------
Name:
Title:
Ex.C--4
Schedule 1
to Assignment and Acceptance
SECTION 1.
Percentage of Assignor's interest in
Commitments, Drawing and
PPA LOC Loans to be assigned: _______%
SECTION 2.
Immediately prior to Effective Date:
Assignor's Commitment: $_______
PPA LOC Loans then owing to Assignor: $_______
Assignor's participation in
PPA Letter of Credit: $_______
Assignor's Percentage Interest (as defined in
the Reimbursement Agreement) _______%
SECTION 3.
Upon Effective Date:
Assignor's Commitment: $_______
Assignor's Percentage Interest: _______%
Assignee's Commitment: $_______
Assignee's Percentage Interest: _______%
SECTION 4.
Effective Date: ____________________
Ex.C--5
EXHIBIT D
AMORTIZATION SCHEDULE
The principal amount of each PPA LOC Loan shall be due and payable in
quarterly installments on consecutive Quarterly Dates, commencing on the
first such Quarterly Date to occur after such PPA LOC Loan is made, and
maturing in full on the applicable PPA LOC Loan Required Payment Date. The
amount of principal payable on each such Quarterly Date shall be equal to
the amount of the principal component only of an amortization schedule
based on the foregoing payment schedule and a final maturity date ten years
from the date on which such PPA LOC Loan is made, or in the case of any
such loan made after the date which is less than ten (10) years prior to
the Final Maturity Date, the Final Maturity Date, and assuming (i) a fixed
PER ANNUM interest rate equal to the interest rate (whether determined with
reference to the Adjusted Base Rate or the Eurodollar Rate) applicable to
such PPA LOC Loan on such date and (ii) mortgage-style payments of
principal and interest.
D--1
SCHEDULE 1
APPLICABLE MARGIN
------------------------------ ------------------------------------------------------------------------
APPLICABLE MARGIN
(The Applicable Margin at any time shall be
the percentage listed below opposite the
rating of the Bonds as in effect at such
time)
RATING/1 /
------------------------------ ------------------------- ---------------------- -----------------------
EURODOLLAR RATE LOANS BASE RATE LOANS LETTER OF CREDIT FEE
------------------------------ ------------------------- ---------------------- -----------------------
BBB+/Baa1 or higher 1.75% 0.25% 0.875%
------------------------------ ------------------------- ---------------------- -----------------------
BBB/Baa2 1.875% 0.375% 1.00%
------------------------------ ------------------------- ---------------------- -----------------------
BBB-/Baa3 2.00% 0.50% 1.125%
------------------------------ ------------------------- ---------------------- -----------------------
BB+/Ba1 3.00% 1.50% 2.125%
------------------------------ ------------------------- ---------------------- -----------------------
BB/Ba2 3.25% 1.75% 2.375%
------------------------------ ------------------------- ---------------------- -----------------------
BB-/Ba3 or lower 3.50% 2.00% 2.675%
------------------------------ ------------------------- ---------------------- -----------------------
- ---------------------------------
1/ The lower of the rating assigned by S&P or Moody's to the Bonds.
Schedule 1