Document/Exhibit Description Pages Size
1: 10-K Annual Report HTML 3.19M
2: EX-4.14.3 Instrument Defining the Rights of Security Holders 6 27K
3: EX-4.14.4 Instrument Defining the Rights of Security Holders 7 36K
4: EX-4.16 Instrument Defining the Rights of Security Holders 104 507K
5: EX-4.17.1 Instrument Defining the Rights of Security Holders 98 474K
6: EX-4.17.2 Instrument Defining the Rights of Security Holders 17 91K
7: EX-4.19 Instrument Defining the Rights of Security Holders 160 719K
8: EX-4.20 Instrument Defining the Rights of Security Holders 164 722K
9: EX-4.21 Instrument Defining the Rights of Security Holders 181 789K
10: EX-10.1.1.2 Material Contract 188 707K
17: EX-10.1.10.2 Material Contract 4 24K
11: EX-10.1.2.6 Material Contract 20 37K
12: EX-10.1.2.7 Material Contract 17 40K
13: EX-10.1.2.8 Material Contract 2 16K
14: EX-10.1.2.9 Material Contract 23 33K
18: EX-10.1.25 Material Contract 28 115K
15: EX-10.1.7.2 Material Contract 6 25K
16: EX-10.1.8.2 Material Contract 4 22K
19: EX-10.2.2.3 Material Contract 28 38K
20: EX-10.2.2.4 Material Contract 45 71K
21: EX-10.2.3 Material Contract 170 635K
22: EX-10.2.4 Material Contract 171 639K
23: EX-10.3.1 Material Contract 54 147K
24: EX-10.3.7 Material Contract 6 28K
25: EX-12.1 Statement re: Computation of Ratios 1 14K
26: EX-21.1 Subsidiaries of the Registrant 8 42K
27: EX-23.1 Consent of Experts or Counsel 1 13K
28: EX-23.2 Consent of Experts or Counsel 1 12K
29: EX-23.3 Consent of Experts or Counsel 1 12K
30: EX-23.4 Consent of Experts or Counsel 1 11K
31: EX-31.1 Certification per Sarbanes-Oxley Act (Section 302) 2± 15K
32: EX-31.2 Certification per Sarbanes-Oxley Act (Section 302) 2± 15K
33: EX-32.1 Certification per Sarbanes-Oxley Act (Section 906) 1 12K
34: EX-99.1 Miscellaneous Exhibit 15 78K
35: EX-99.2 Miscellaneous Exhibit 1 12K
EXHIBIT 10.1.25
EXECUTION COPY
================================================================================
CALPINE CORPORATION
DESIGNATED ASSET SALE PROCEEDS ACCOUNT CONTROL AGREEMENT
Dated as of July 16, 2003
================================================================================
TABLE OF CONTENTS
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PAGE
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ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions............................................................................... 2
SECTION 1.02. Rules of Interpretation................................................................... 3
ARTICLE II
DESIGNATED ASSET SALE PROCEEDS ACCOUNT
SECTION 2.01. Designated Asset Sale Proceeds Account.................................................... 3
SECTION 2.02. Permitted Investments..................................................................... 6
SECTION 2.03. Monies Received by the Company............................................................ 7
SECTION 2.04. Books of Designated Asset Sale Proceeds Account; Statements............................... 7
ARTICLE III
SECURITY AND RELATED PROVISIONS; SECURITIES INTERMEDIARY
SECTION 3.01. Securities Designated Asset Sale Proceeds Account......................................... 8
SECTION 3.02. Certain Rights and Powers in Respect of Designated Asset Sale Proceeds Account and Funds.. 9
SECTION 3.03. Security Interest......................................................................... 10
SECTION 3.04. Duties and Certain Rights of Depositary Agent............................................. 12
SECTION 3.05. Remedies.................................................................................. 17
ARTICLE IV
TERMINATION OF AGREEMENT
SECTION 4.01. Rights and Obligations of Collateral Trustee and Depositary Agent......................... 18
SECTION 4.02. Secured Obligations....................................................................... 18
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Notices................................................................................... 19
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SECTION 5.02. Benefit of Agreement...................................................................... 19
SECTION 5.03. No Waiver; Remedies Cumulative............................................................ 20
SECTION 5.04. Severability.............................................................................. 20
SECTION 5.05. Amendments................................................................................ 20
SECTION 5.06. Headings.................................................................................. 20
SECTION 5.07. Governing Law............................................................................. 20
SECTION 5.08. CONSENT TO JURISDICTION................................................................... 20
SECTION 5.09. WAIVER OF JURY TRIAL...................................................................... 21
SECTION 5.10. Successors and Assigns.................................................................... 22
SECTION 5.11. Entire Agreement.......................................................................... 22
SECTION 5.12. Survival of Agreements.................................................................... 22
SECTION 5.13. Further Information....................................................................... 22
SECTION 5.14. Additional Depositary Agent Provisions.................................................... 22
SECTION 5.15. Counterparts.............................................................................. 23
SECTION 5.16. Effectiveness............................................................................. 23
SECTION 5.17. Collateral Trustee's Obligations.......................................................... 23
EXHIBIT A: Remittance Instruction Form
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This DESIGNATED ASSET SALE PROCEEDS ACCOUNT CONTROL AGREEMENT, dated as
of July 16, 2003 (this "Agreement"), is entered into by and among CALPINE
CORPORATION, a Delaware corporation (the "Company"), Union Bank of California,
N.A., as the bank and the securities intermediary (together with its permitted
successors in such capacity, the "Depositary Agent"), and THE BANK OF NEW YORK,
as Collateral Trustee (together with its successors in such capacity, the
"Collateral Trustee").
RECITALS:
WHEREAS, Calpine Corporation (the "Company") intends to enter
into an Amended and Restated Credit Agreement dated as of July 16, 2003 (as
amended, modified, renewed, restated or replaced from time to time, the "Credit
Agreement") among, inter alia, the Company, the Lenders referred to therein and
The Bank of Nova Scotia, as Administrative Agent (the "Credit Agreement Agent"),
relating to a $500,000,000 senior secured credit facility to be made available
in the form of revolving loans and term loans, including letters of credit to be
issued thereunder;
WHEREAS, the Company intends to (a) issue $500,000,000 in
aggregate principal amount of Second Priority Senior Secured Floating Rate Notes
due 2007 (the "2007 Notes") pursuant to the Indenture dated as of July 16, 2003
(the "2007 Indenture") between the Company and Wilmington Trust Company, as
Trustee (together with its successors in such capacity, the "2007 Trustee"), (b)
issue $1,150,000,000 in aggregate principal amount of 8.50% Second Priority
Senior Secured Notes due 2010 (the "2010 Notes") pursuant to the Indenture dated
as of July 16, 2003 (the "2010 Indenture") between the Company and Wilmington
Trust Company, as Trustee (together with its successors in such capacity, the
"2010 Trustee"), (c) issue $900,000,000 in aggregate principal amount of 8.75%
Second Priority Senior Secured Notes due 2013 (the "2013 Notes") pursuant to the
Indenture dated as of July 16, 2003 (the "2013 Indenture") between the Company
and Wilmington Trust Company, as Trustee (together with its successors in such
capacity, the "2013 Trustee"), and (d) borrow $750,000,000 in Term Loans (the
"Term Loans") pursuant to a Term Loan Agreement dated as of July 16, 2003 (the
"Term Loan Agreement") between the Company and Goldman Sachs Credit Partners
L.P., as Administrative Agent (together with its successors in such capacity,
the "Term Loan Administrative Agent");
WHEREAS, the Company and certain of its Subsidiaries have
entered into a Collateral Trust Agreement dated as of July 16, 2003 (the
"Collateral Trust Agreement") among, inter alia, the Company, certain
Subsidiaries and the Collateral Trustee which sets forth the terms on which the
Company and such Subsidiaries have appointed the Collateral Trustee as trustee
for the present and future holders of the Secured Obligations to receive, hold,
maintain, administer, enforce and distribute the Security Documents, including
this Agreement, at any time delivered to the Collateral Trustee and all
interests, rights, powers and remedies of the Collateral Trustee thereunder and
the proceeds thereof;
WHEREAS, it is a condition precedent to the obligation of the
lenders to make their respective extensions of credit to the Company under each
of the Credit Agreement and the Term Loan Agreement, and condition precedent to
the obligation of the purchasers to purchase
each of the 2007 Notes, the 2010 Notes and the 2013 Notes, that the Company
shall have executed and delivered this Agreement; and
WHEREAS, The Depositary Agent has agreed to act as depositary
agent and, with respect to any securities entitlements held by it pursuant to
this Agreement, as securities intermediary pursuant to the terms of this
Agreement.
NOW THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions. Capitalized terms used in this Agreement that are
defined in the Collateral Trust Agreement and not otherwise defined herein shall
have the meanings set forth in the Collateral Trust Agreement. All capitalized
terms used in this Agreement that are defined in Article 9 of the UCC, as in
effect on the date of this Agreement in the State of New York, and not otherwise
defined herein shall have the meanings therein set forth. In addition, the
following term when used in this Agreement shall have the following meaning:
"Cash Equivalents" means:
(1) the lawful currency of any country where the Company owns or
operates a Facility;
(2) securities issued or directly and fully guaranteed or insured by the
United States government or any state thereof (or any agency or
instrumentality thereof), by the Canadian government (or any agency or
instrumentality thereof), or by the government of a member state of the
European Union (or any agency or instrumentality thereof), in each case the
payment of which is backed by the full faith and credit of the United
States, Canada or the relevant member state of the European Union, as the
case may be, and having maturities of not more than six months from the date
of acquisition;
(3) certificates of deposit and eurodollar time deposits with maturities
of six months or less from the date of acquisition, bankers' acceptances
with maturities not exceeding six months and overnight bank deposits, in
each case, with any lender party to the Credit Agreement or with any
domestic commercial bank having capital and surplus in excess of $500.0
million and a Thomson Bank Watch or successor rating agency rating of "B" or
better;
(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications
specified in clause (3) above;
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(5) commercial paper having one of the two highest ratings obtainable
from Moody's or S&P and maturing within six months after the date of
acquisition; and
(6) money market funds at least 95% of the assets of which constitute
Cash Equivalents of the kinds described in clauses (1) through (5) of this
definition.
"Designated Collateral" means Designated Assets other than Canadian Gas
Assets.
"Secured Parity Lien Parties" means any Person who is holding a Parity
Lien Obligation (including any Parity Debt Representative), at any time.
"Secured Parties" means any Person who is holding a Secured Obligation
(including any Secured Debt Representative), at any time.
"Secured Priority Lien Parties" means any Person who is holding a
Priority Lien Obligation (including any Priority Lien Agent), at any time.
SECTION 1.02 Rules of Interpretation. The rules of interpretation or
construction set forth in Section 1.2 of the Collateral Trust Agreement shall
apply with like effect to this Agreement.
ARTICLE II
DESIGNATED ASSET SALE PROCEEDS ACCOUNT
SECTION 2.01 Designated Asset Sale Proceeds Account.
(a) Establishment of Designated Asset Sale Proceeds Account. The
Company hereby directs the Depositary Agent to establish and maintain an account
in the name of the Company (as the entitlement holder) entitled "Designated
Asset Sale Proceeds Blocked Account Subject to the Security Interest of The Bank
of New York, as Collateral Trustee" and numbered 6711713800 (the "Designated
Asset Sale Proceeds Account"). The Designated Asset Sales Proceeds Account shall
at all times be under the sole and exclusive dominion and control of the
Collateral Trustee, subject to the terms and provisions of this Agreement.
(b) Deposits of Net Sale Consideration. The Collateral Trustee and
the Company shall promptly deposit or cause to be deposited into the Designated
Asset Sale Proceeds Account all Net Proceeds (including all amounts and proceeds
(including instruments) received by the Company or the Collateral Trustee (as
loss payee or additional insured) under any insurance policy maintained by the
Company or any other Person in respect of the Designated Collateral (the
"Insurance Proceeds") or any amounts and proceeds (including instruments)
received by the Company by reason of any compulsory transfer or taking by
condemnation, eminent domain or exercise of a similar power, or transfer under
threat of such compulsory transfer or taking, of any part of the Designated
Collateral, other than an immaterial portion thereof, by any agency, department,
authority, commission, board, instrumentality or
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political subdivision of the state in which such Designated Collateral is
located, the United States or another governmental authority having jurisdiction
which is not rescinded or revoked within 60 days after the date of such transfer
or taking (the "Eminent Domain Proceeds" and, together with the Insurance
Proceeds, the "Loss Proceeds")).
(c) Withdrawals.
(i) General Provisions Regarding Release of Net Proceeds.
Subject to the terms and provisions of this Agreement, deposits of Net
Proceeds in the Designated Asset Sales Proceeds Account, and income
therefrom, may be withdrawn only upon order of the Collateral Trustee. Upon
the Collateral Trustee's receipt of an Officer's Certificate from the
Company stating:
(A) that a specified amount of the funds on
deposit in the Designated Asset Sale Proceeds Account (x) will be used,
promptly upon withdrawal from the Designated Asset Sale Proceeds
Account, to (1) purchase other assets that would constitute Designated
Assets or (2) repay Priority Lien Debt and/or cash collateralize
letters of credit constituting Priority Lien Debt and, if such Priority
Lien Debt is revolving credit Indebtedness, to correspondingly reduce
commitments with respect thereto, in each case in accordance with the
applicable provisions of each Secured Debt Document or (y) to the
extent that any such funds are not applied as provided in clause (x),
have been offered to the holders of Parity Lien Obligations in
compliance with the applicable provisions of each Parity Lien Debt
Document in Asset Sale Offers that were not accepted and have been
released from the Collateral Trustee's Liens and are required to be
released to the Company pursuant to such applicable provisions; and
(B) no Secured Debt Default has occurred and is
continuing;
then, if the conditions set forth in Section 4.1(a) and (b) of the Collateral
Trust Agreement are satisfied, the Collateral Trustee promptly shall instruct
the Depositary Agent in writing using the form attached hereto as Exhibit A, to
remit such amount to the Company as directed in any remittance instruction
delivered to the Collateral Trustee by the Company. The Depositary Agent shall
comply with such instructions.
(ii) General Provisions Regarding a Major Loss. Provided
that the conditions set forth in clauses (A) or (B) below have been
satisfied or have been waived by the Collateral Trustee, if there shall
occur any damage, destruction, condemnation or other similar taking of
Designated Collateral or other event with respect to which Loss Proceeds
for any single loss in excess of $25,000,000 are payable (a "Major Loss")
such Loss Proceeds shall be released by the Collateral Trustee to the
Company in accordance with clauses (A) and (B) below.
(A) Release with no Provision for Repair,
Replacement or Restoration. If there shall occur any Major Loss and
upon the Collateral Trustee's
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receipt of an Officer's Certificate from the Company (in addition to
such other statements and certifications required pursuant to Section
2.01(c)(i)):
(1) certifying that the Company has
determined in its good faith judgment not to repair, restore
or replace the property subject to a Major Loss; and
(2) stating that no Secured Debt
Default has occurred and is continuing,
then, such Loss Proceeds shall be released by the Collateral Trustee to
the Company in accordance with Section 2.01(c)(i).
(B) Repair and Restoration Procedures. In regard
to a Major Loss, the Collateral Trustee shall instruct the Depositary
Agent, in writing using the form attached hereto as Exhibit A, to remit
to the Company, from the Designated Asset Sales Proceeds Account, such
amounts as directed in any remittance instruction delivered to the
Collateral Trustee by the Company, and, upon such remittance, the
Collateral Trustee's Liens thereon shall be released, for application
to such Major Loss, only in accordance with the following requirements,
and the Depository Agent shall comply with such instructions:
(1) the Company will cause any
restoration or replacement to be commenced and
completed promptly and diligently;
(2) disbursements of Loss Proceeds for
application toward repair, restoration or replacement
shall be instructed by the Collateral Trustee upon
the Company's written request and the presentation to
the Collateral Trustee of an Officer's Certificate:
(I) describing in reasonable detail
the nature of the proposed repair, restoration or
replacement to be effected with such release;
(II) if the entity or entities that
are required to pay Loss Proceeds to the Company are
not collectively required to pay for all costs and
expenses associated with completing any repair,
restoration or replacement, without limitation, then
providing a project budget for the proposed repair,
restoration or replacement (which shall include a 10%
contingency allowance) prepared in good faith and
upon reasonable assumptions by the Company; and
(III) stating (A) the reasonably
estimated overall cost of the proposed project, (B)
the specific amount requested to be released from the
Designated Asset Sales Proceeds Account and
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(C) that such amount promptly will be applied to pay
the costs associated with such proposed project and,
if clause (II) above is applicable, in accordance
with the budget referred to in clause (II) above;
(IV) stating that no Secured Debt
Default has occurred and is continuing.
(iii) General Provisions Regarding a Minor Loss. If there
shall occur any damage, destruction, condemnation or other similar taking
of Collateral or other event with respect to which Loss Proceeds for any
single loss less than $25,000,000 are payable (a "Minor Loss"), such Loss
Proceeds, and related income, shall be released by the Collateral Trustee
to the Company in accordance with Section 2.01(c)(i).
(iv) Collateral Trustee Releases. The Collateral Trustee
agrees that it shall execute (with such acknowledgements and/or
notarizations as are required) and deliver such releases required under
this Section 2.01(c) to the Company on or before the fifth business day
after receiving all documents required by this Section 2.01(c) for such a
release.
SECTION 2.02. Permitted Investments.
(a) [Reserved]
(b) Application of Permitted Investments. So long as no Actionable
Default has occurred and is continuing, the Depositary Agent shall, if and to
the extent that the Company directs, make such investments in Cash Equivalents
at the direction of the Company; provided that in the absence of any such
direction by the Company all amounts in the Designated Asset Sale Proceeds
Account shall be invested in those Cash Equivalents set forth in clause (6) of
the definition thereof. Cash Equivalents, if any, purchased upon the direction
of the Company under the provisions of this Agreement shall be deemed at all
times to be a part of the Designated Asset Sale Proceeds Account from which
funds were withdrawn in order to acquire such Cash Equivalents and shall be
deemed to constitute funds on deposit in and credited to the Designated Asset
Sale Proceeds Account, and all such Cash Equivalents and the income or interest
earned and gains realized in excess of losses suffered by the Designated Asset
Sale Proceeds Account due to the investment of funds deposited therein shall be
credited and retained in the Designated Asset Sale Proceeds Account, except as
otherwise expressly provided by the terms hereof.
(c) Earnings. All earnings, if any, on funds in the Designated
Asset Sale Proceeds Account maintained hereunder shall be credited to the
Company for tax reporting purposes. The Depositary Agent shall provide to the
Company a statement with respect to all interest earned on the Designated Asset
Sale Proceeds Account as of the close of each calendar year for which income is
earned on the Designated Asset Sale Proceeds Account. The Company shall provide
the Depositary Agent with its taxpayer identification number, documented, to the
extent necessary, by an appropriate executed Form W-9, upon execution of this
Agreement. This form shall, to the extent necessary, be renewed as required by
the Internal Revenue Service and
6
provided to the Depositary Agent. The Depositary Agent shall be entitled to rely
on an opinion of legal counsel (which may be counsel to the Company) in
connection with the reporting of any earnings with respect hereto.
(d) Liquidation of Investments for Distributions. The Collateral
Trustee is hereby authorized (so long as no Actionable Default has occurred and
is continuing, upon the written direction of the Company) to direct the
Depositary Agent, in writing using the form attached hereto as Exhibit A, to
liquidate or direct the liquidation of any Cash Equivalents (without regard to
maturity) in order to make or cause to be made any application required by any
Section of this Article 2. In furtherance, and not in limitation, of any other
indemnity or limitation of liability with respect to the Collateral Trustee
contained herein or in any other Secured Debt Document, the Collateral Trustee
and the Depositary Agent shall in no way be liable for any losses suffered by
the Company, including losses due to early liquidation or market risk, which are
a result of the Collateral Trustee's exercise of its authority under this
provision.
(e) Value of Permitted Investments. Cash Equivalents, if any,
credited to the Designated Asset Sale Proceeds Account shall be valued at their
current market value.
SECTION 2.03. Monies Received by the Company. In the event that the Company
receives any cash or Cash Equivalents constituting Net Proceeds (including any
Loss Proceeds) or other amounts required by the terms hereof to be deposited
into the Designated Asset Sale Proceeds Account, the Company shall hold the same
in precisely the form received in trust for and on behalf of the Secured
Parties, segregated from other funds of the Company, and without any notice or
demand whatsoever, shall promptly deliver the same to the Depositary Agent for
application in accordance with the terms of this Agreement. No balance in, or
financial asset or other asset credited to, the Designated Asset Sale Proceeds
Account pursuant to the terms hereof and maintained hereunder shall be disbursed
or transferred by the Depositary Agent, except in accordance with the provisions
hereof.
SECTION 2.04. Books of Designated Asset Sale Proceeds Account; Statements.
The Depositary Agent shall maintain books of account on a cash basis and record
therein all deposits into and transfers to and from the Designated Asset Sale
Proceeds Account and all investment transactions effected by the Depositary
Agent pursuant to the terms hereof, and any such recordation shall constitute
prima facie evidence of the information recorded. Not later than the tenth
Business Day of each month or as soon as practicable thereof, but in no event
later than the twentieth calendar day of each month, commencing with the first
month to occur after the earliest of the receipt of Net Proceeds into the
Designated Asset Sale Proceeds Account in accordance with the terms hereof, the
Depositary Agent shall deliver to the Company a statement setting forth the
transactions in the Designated Asset Sale Proceeds Account during the preceding
month (including deposits, withdrawals and transfers from and to the Designated
Asset Sale Proceeds Account) and specifying the Net Proceeds, Cash Equivalents
and other amounts held in or credited to the Designated Asset Sale Proceeds
Account at the close of business on the last Business Day of the preceding
month. In addition, the Depositary Agent shall promptly respond (during normal
business hours) to requests by the Company for
7
information regarding deposits, investments and transfers into, in respect of
the Designated Asset Sale Proceeds Account.
ARTICLE III
SECURITY AND RELATED PROVISIONS; SECURITIES INTERMEDIARY
SECTION 3.01. Securities Designated Asset Sale Proceeds Account.
(a) Acknowledgement. The Depositary Agent hereby agrees and
confirms that the Depositary Agent has established the Designated Asset Sale
Proceeds Account as set forth and defined in this Agreement.
(b) Agreement. Each of the parties hereto agrees that:
(i) the Designated Asset Sale Proceeds Account will be
maintained, to the extent that "financial assets" (within the meaning of
Section 8-102(a)(9) of the UCC, and as so defined the term financial asset
is so used throughout this Agreement) are deposited therein or credited
thereto, as a "securities account" (within the meaning of Section 8-501 of
the UCC), and, to the extent that credit balances not constituting
financial assets are credited thereto, as a "deposit account" (within the
meaning of Section 9-102(a)(29) of the UCC);
(ii) the Company is an "entitlement holder" (within the
meaning of Section 8-102(a)(7) of the UCC) in respect of any "financial
assets" credited to the Designated Asset Sale Proceeds Account and the
"customer" (within the meaning of Section 9-104 of the UCC) to the extent
that credit balances not constituting financial assets are credited
thereto;
(iii) all Cash Equivalents and all other property (including a
security, security entitlement, investment property, instrument or
obligation, share, participation, interest, cash or other property
whatsoever) delivered to the Depositary Agent will be promptly credited by
the Depositary Agent to the Designated Asset Sale Proceeds Account by an
appropriate entry in its records in accordance with this Agreement;
(iv) all financial assets and other assets in registered form
or payable to or to order and credited to the Designated Asset Sale
Proceeds Account shall be registered in the name of, payable to or to the
order of, or specially endorsed to, the Depositary Agent or in blank, or
credited to another securities account maintained in the name of the
Depositary Agent, and in no case will any such financial asset or other
asset be credited to the Designated Asset Sale Proceeds Account at any
time, if, at such time, such asset is registered in the name of, payable to
or to the order of, or endorsed to, the Collateral Trustee (in such
capacity) or the Company, except to the extent the foregoing have been
subsequently endorsed by the Collateral Trustee (in such capacity) or the
Company to the Depositary Agent or in blank;
8
(v) the Depositary Agent is acting as "securities
intermediary" (within the meaning of Section 8-102(a)(14) of the UCC) with
respect to the Designated Asset Sale Proceeds Account and financial assets
deposited therein or credited thereto and as a "bank" (within the meaning
of Section 9-304 of the UCC) with respect to the Designated Asset Sale
Proceeds Account and credit balances not constituting financial assets
credited thereto; and
(vi) the Depositary Agent shall not change the name or account
number of the Designated Asset Sale Proceeds Account without the prior
written consent of the Company and the Collateral Trustee, which consents
shall not be unreasonably withheld.
SECTION 3.02. Certain Rights and Powers in Respect of Designated Asset Sale
Proceeds Account and Funds.
(a) Rights to Designated Asset Sale Proceeds Account. The Company
shall not make, attempt to make or consent to the making of any withdrawal or
transfer from the Designated Asset Sale Proceeds Account except in strict
adherence to the terms and conditions of this Agreement. The Company shall not
have any rights or powers with respect to the remittance of amounts credited to,
the disbursement of credited amounts out of, or the investment of credited
amounts in, the Designated Asset Sale Proceeds Account, except to have amounts
credited thereto remitted, applied, disbursed or invested in accordance with
this Agreement; provided, however, that the parties hereto acknowledge and agree
that the foregoing provisions of this Section 3.02(a) shall not be deemed to
divest the Company of its interest as an "entitlement holder" under the UCC, as
provided in this Agreement.
(b) Certain Powers of the Collateral Trustee and the Depositary
Agent. The Collateral Trustee and, where appropriate, the Depositary Agent will
have the right, but not the obligation, to (i) refuse any item for credit to the
Designated Asset Sale Proceeds Account except as required by the terms of this
Agreement and (ii) refuse to honor any request for transfer on the Designated
Asset Sale Proceeds Account which is not consistent with this Agreement. If the
Company fails to perform any agreement contained herein and such failure to
perform is continuing for a period of 30 days, the Collateral Trustee may (but
shall not be obligated to) itself perform, or cause the performance of, such
agreement, and the expenses of the Collateral Trustee incurred in connection
therewith shall be payable by the Company upon written demand. The Company
hereby irrevocably appoints the Collateral Trustee as the Company's
attorney-in-fact, with full authority in the place and stead of the Company, and
in the name of the Company or otherwise from time to time, if an Actionable
Default shall have occurred and be continuing, to take any action and to execute
any instrument which is necessary or advisable to accomplish the purposes of
this Agreement, including:
(i) to ask, demand, collect, sue for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become due
under or in respect of any of the Designated Asset Sale Proceeds Account or
the proceeds of financial assets or other assets held therein or credited
thereto;
9
(ii) to receive, endorse, and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (i)
above;
(iii) to file any claims or take any action or institute any
proceedings which is necessary or desirable for the collection of any of
the Designated Asset Sale Proceeds Account or the proceeds of financial
assets or other assets held therein or credited thereto or otherwise to
enforce the rights of the Collateral Trustee with respect to the Designated
Asset Sale Proceeds Account or the proceeds of financial assets or other
assets held therein or credited thereto, provided that, with respect to
this clause (iii), such rights shall be exercised in accordance with
Section 3.05; and
(iv) to perform the affirmative obligations of the Company
hereunder if, and to the extent that, the Company fails to perform such
obligations and such failure to perform is continuing for a period of 30
days.
The Company hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section 3.02(b) is irrevocable and coupled with an
interest. The powers conferred on the Collateral Trustee hereunder are solely to
protect its interest (on behalf of the applicable Secured Parties) in the
Designated Asset Sale Proceeds Account and the proceeds of financial assets and
other assets held therein or credited thereto and shall not impose any duty on
the Collateral Trustee to exercise any such powers. Except for the reasonable
care of the Designated Asset Sale Proceeds Account in its possession or under
its control (as the case may be) and the accounting for moneys actually received
by it hereunder, neither the Depositary Agent nor the Collateral Trustee shall
have any duty as to the Designated Asset Sale Proceeds Account or the proceeds
of financial assets or other assets held therein or credited thereto, or as to
the taking of any necessary steps to preserve rights against prior parties or
any other rights pertaining to the Designated Asset Sale Proceeds Account or
proceeds. Each of the Depositary Agent and the Collateral Trustee is required to
exercise reasonable care in the custody and preservation of the Designated Asset
Sale Proceeds Account and the financial assets and other assets held therein or
credited thereto in its possession or under its control (as the case may be);
provided, however, that the Collateral Trustee in any event shall be deemed to
have exercised reasonable care in the custody and preservation of the Designated
Asset Sale Proceeds Account if it takes such action for that purpose as the
Company reasonably requests in writing at times other than upon the occurrence
and during the continuance of any Actionable Default.
SECTION 3.03. Security Interest.
(a) Grant. To secure (i) the timely payment in full in cash and
performance in full of the Secured Priority Lien Obligations of the Company, the
Company does hereby assign, grant, hypothecate and pledge to, and grant a first
priority security interest in favor of the Collateral Trustee, on behalf of and
for the sole and exclusive benefit of the Secured Priority Lien Parties and (ii)
the timely payment in full in cash and performance in full of the Secured Parity
Lien Obligations of the Company, the Company does hereby assign, grant,
hypothecate and pledge to, and grant a second priority security interest in
favor of the Collateral Trustee, on behalf of and for the sole and exclusive
benefit of the Secured Parity Lien Parties, in the case of
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each of clauses (i) and (ii) on all the estate, right, title, interest and
security entitlements of the Company, whether now owned or hereafter acquired,
in the Designated Asset Sale Proceeds Account and in all cash, cash equivalents,
instruments, investments, other securities, financial assets and other assets
held therein or credited thereto and all proceeds thereof, including all rights
of the Company to receive moneys due in respect of such Designated Asset Sale
Proceeds Account, all claims with respect to such Designated Asset Sale Proceeds
Account, all income or gain earned in respect of the financial assets and other
assets held in or credited to such Designated Asset Sale Proceeds Account, and
all proceeds receivable or received when any financial asset or other asset held
in or credited to an Designated Asset Sale Proceeds Account is collected,
exchanged or otherwise disposed of, whether voluntarily or involuntarily.
This Agreement and the security interests and Liens granted and created
herein secures the payment and performance of all Secured Obligations of the
Company now or hereafter, whether direct or indirect, absolute or contingent,
and whether for principal, reimbursement obligations, interest, fees, premiums,
penalties, indemnifications, expenses or otherwise, and including all amounts
that constitute part of the Secured Obligations and would be owed by the Company
but for the fact that they are unenforceable or not allowed due to a pending
Bankruptcy Case or Insolvency Proceeding. Without limiting the generality of the
foregoing, it is the intent of the parties that (i) the Priority Lien
Obligations are superior in right of payment to all the Parity Lien Obligations,
in the manner and to the extent as set forth in Section 3.4 of the Collateral
Trust Agreement and (ii) this Agreement creates two separate and distinct Liens:
the first Lien securing the payment and performance of the Priority Lien
Obligations and the second Lien securing the payment and performance of the
Parity Lien Obligations.
(b) Acknowledgment. The Depositary Agent hereby acknowledges the
first priority security interest in, and the pledge by the Company to the
Collateral Trustee for the benefit of, the Secured Parties of all of the
Company's assets held in or credited to the Designated Asset Sale Proceeds
Account and all proceeds thereof, and will so indicate on the records maintained
by the Depositary Agent with respect to the Designated Asset Sale Proceeds
Account. The Depositary Agent agrees to hold all such assets for the purposes
of, and on the terms set forth in, this Agreement.
(c) Other Liens; Adverse Claim.
(i) The Company represents and warrants that:
(A) it has not assigned any of its rights under
the Designated Asset Sale Proceeds Account;
(B) it has not executed and is not aware of any
effective financing statement, security agreement, control agreement or
other instrument similar in effect covering all or any part of the
Designated Asset Sale Proceeds Account except in favor of the
Collateral Trustee; and
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(C) it has full power and authority to grant a
security interest in and assign its right, title and interest in the
Designated Asset Sale Proceeds Account and all financial assets and
other assets held therein or credited thereto and all proceeds thereof
hereunder.
(ii) The Company represents, warrants and covenants that
it has not granted, and shall not grant, to any Person other than the
Collateral Trustee any interest in Designated Asset Sale Proceeds Account
and that it has kept, and shall keep, the Designated Asset Sale Proceeds
Account free from all Liens other than Permitted Prior Liens.
(iii) The Depositary Agent represents and warrants that it
has no knowledge (without having conducted an independent investigation) of
any Lien on the Designated Asset Sale Proceeds Account other than the
claims and interest of the parties hereto as provided herein. In the event
that the Depositary Agent has or subsequently obtains by agreement,
operation of law or otherwise a security interest in the Designated Asset
Sale Proceeds Account or any financial asset or other asset credited
thereto, the Depositary Agent hereby agrees that such security interest
shall be subordinate to the security interest of the Collateral Trustee for
the benefit of the Secured Parties.
(iv) The Depositary Agent represents and warrants that it
has no notice (without having conducted an independent investigation) of
any adverse claim to the financial assets or other assets deposited in or
credited to the Designated Asset Sale Proceeds Account or to security
entitlements with respect thereto.
(v) The financial assets and other assets credited to the
Designated Asset Sale Proceeds Account shall not be subject to deduction,
set-off, banker's lien, or any other right in favor of any Person other
than the Collateral Trustee, except as set forth in clause (vi) below.
(vi) All usual and customary fees, costs or expenses of
the Depositary Agent in connection with this Agreement and any transactions
carried out hereunder shall be paid by the Company. In the event that any
such fees, costs or expenses shall remain unpaid in excess of 30 days from
their applicable due date, and after sufficient notice has been given to
the Company, the Depositary Agent may deduct such unpaid amounts from the
Designated Asset Sale Proceeds Account; provided that in such event the
Company shall be obligated to promptly pay an amount of cash equal to such
deducted amounts back into the Designated Asset Sale Proceeds Account.
SECTION 3.04. Duties and Certain Rights of Depositary Agent.
(a) General. The duties of the Depositary Agent shall be
determined solely by the express provisions of this Agreement and by applicable
law and no duties, implied covenants or obligations shall be read into this
Agreement against the Depositary Agent as depositary agent, securities
intermediary and bank.
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(b) Acceptance of Appointment. The Depositary Agent hereby agrees
to act as depositary agent and securities intermediary with respect to the
Designated Asset Sale Proceeds Account and pursuant to this Agreement. The other
parties hereto hereby acknowledge that the Depositary Agent shall act as
depositary agent, securities intermediary and bank with respect to the
Designated Asset Sale Proceeds Account and pursuant to this Agreement.
(c) Financial Assets Election. The Depositary Agent hereby agrees
that each item of property (including a security, security entitlement,
investment property, instrument or obligation, share or participation) credited
to the Designated Asset Sale Proceeds Account shall be treated as a financial
asset under Article 8 of the UCC other than cash from time to time and at any
time deposited in the Designated Asset Sale Proceeds Account, and interest
accrued or paid thereon.
(d) Negative Pledge. Subject to the terms of this Agreement, the
Depositary Agent hereby agrees that it shall not grant any Lien in the financial
assets and other assets that it is obligated to maintain under this Agreement.
(e) Entitlement Orders, Instructions. If at any time that an
Actionable Default shall have occurred and be continuing the Depositary Agent
shall receive any entitlement order, instruction or any other order from the
Collateral Trustee directing the transfer or redemption of any financial asset
or other asset relating to the Designated Asset Sale Proceeds Account, or
directing the disposition of any funds in the Designated Asset Sale Proceeds
Account, the Depositary Agent shall comply with such entitlement order,
instruction or other order without further consent by the Company or any other
Person. The parties hereto agree that until the Depositary Agent's obligations
under this Agreement shall terminate in accordance with the terms hereof, the
Collateral Trustee shall have control of each of the Company's security
entitlements with respect to the financial assets and other assets credited to
the Designated Asset Sale Proceeds Account; provided, however, that the Company,
as the entitlement holder with respect to the financial assets credited to the
Designated Asset Sale Proceeds Account and the Person for whom the Designated
Asset Sale Proceeds Account are maintained, is entitled, subject to Section 2.02
and the other provisions of this Agreement, to make substitutions for the
security entitlements with respect to the financial assets credited to the
Designated Asset Sale Proceeds Account; provided, further, that until an
Actionable Default shall have occurred and be continuing, the Collateral Trustee
shall so act upon the written direction of the Company. The Depositary Agent
hereby represents that it has not entered into, and agrees that, until the
termination of this Agreement and the other Secured Debt Documents in accordance
their terms, it will not enter into, any agreement with any other Person in
respect such Designated Asset Sale Proceeds Account pursuant to which it would
agree to comply with entitlement orders made by such Person.
(f) Degree of Care. The Depositary Agent shall exercise due care
in accordance with reasonable commercial standards in administering the
Designated Asset Sale Proceeds Account, accounting for assets credited to the
Designated Asset Sale Proceeds Account and performing its duties as a bank with
respect to the Designated Asset Sale Proceeds Account, and to the extent that
any "investment property" is on deposit, accounting for financial assets and
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other assets credited to the Designated Asset Sale Proceeds Account and
performing its duties as securities intermediary with respect to the Designated
Asset Sale Proceeds Account and, in each case, such assets deposited therein or
credited thereto and the credit balances credited thereto under this Agreement.
(g) Action Upon Notices; Exercise of Judgment. The Depositary
Agent shall be permitted to conclusively rely and act upon any notice,
entitlement order, instruction, request, waiver, consent, receipt or other paper
or document whether in its original or facsimile form reasonably believed by the
Depositary Agent to be signed by the Collateral Trustee, the Company or any
other authorized Person. The Depositary Agent shall not be liable for any error
of judgment or for any act done or step taken or omitted by it in good faith or
for any mistake of fact or law or for anything which the Depositary Agent may do
or refrain from doing in connection herewith, except its own gross negligence or
willful misconduct. The Depositary Agent shall have duties only to the
Collateral Trustee (on behalf of the Secured Parties).
(h) Indemnification and Liability. In consideration of the
appointment of Depositary Agent, the Company agrees:
(i) to fully indemnify and hold the Depositary Agent and
each Affiliate, officer, director, shareholder, employee and agent of the
Depositary Agent (each, an "Indemnified Person") harmless from and against
any and all claim, loss, liability, damage, cost or expense (including
reasonable legal fees and expenses) incurred by the Indemnified Person by
reason of or resulting from this Agreement (including its having accepted
such appointment or by reason of its carrying out of any of the terms of
this Agreement); and
(ii) to reimburse each Indemnified Person for all its
expenses, including reasonable fees and expenses of counsel and court costs
incurred by reason of any position or action taken by the Indemnified
Person pursuant to this Agreement or in connection with any action brought
to interpret or enforce the provisions of this Agreement or any part
thereof;
except, with respect to each of clauses (i) and (ii), to the extent that any
such claim, loss, liability, damage, cost or expense is determined by a court of
competent jurisdiction in a final non-appealable judgment to have been caused by
the Indemnified Person's gross negligence or willful misconduct. The parties
hereto hereby agree that no Indemnified Person shall be liable to such parties
for any actions taken by any Indemnified Person pursuant to and in compliance
with the terms hereof except in respect of any liability or expenses incurred by
the Indemnified Person arising from its gross negligence or willful misconduct.
Any Indemnified Person may consult with legal counsel of its selection in the
event of any dispute or question as to the construction of this Agreement or the
Indemnified Person's duties hereunder, and the Indemnified Person shall incur no
liability and shall be fully protected in acting in accordance with the opinion
and instructions of such counsel.
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(i) Court Orders. The Depositary Agent is hereby authorized, in
its exclusive discretion, to obey and comply with all writs, orders, judgments
or decrees issued by any court or administrative agency affecting the Designated
Asset Sale Proceeds Account or any financial asset credited to the Designated
Asset Sale Proceeds Account. The Depositary Agent shall not be liable to any of
the parties hereto, their successors or assigns by reason of the Depositary
Agent's compliance with such writs, orders, judgments or decrees,
notwithstanding that such writ, order, judgment or decree may later be reversed,
modified, set aside or vacated.
(j) Resignation and Termination.
(i) The Depositary Agent may at any time resign by giving
notice to each other party to this Agreement, such resignation to be
effective upon the appointment of a successor Depositary Agent as provided
below. The Company may remove the Depositary Agent at any time by giving
notice to each other party to this Agreement, such removal to be effective
upon the appointment of a successor Depositary Agent as provided below.
(ii) In the event of any removal of the Depositary Agent,
a successor Depositary Agent, which shall be a bank or trust company
organized under the laws of the United States of America or any state
thereof capable of acting as a "securities intermediary" (within the
meaning of Section 8-102(a)(14) of the UCC) and a "bank" (within the
meaning of Section 9-102(a)(8) of the UCC), having a capital and surplus of
not less than $50,000,000, shall be appointed by the Company. If a
successor Depositary Agent shall not have been appointed and accepted its
appointment as Depositary Agent within 45 days after such notice of removal
of the Depositary Agent, the Depositary Agent, the Collateral Trustee or
the Company may apply to any court of competent jurisdiction at the expense
of the Company to appoint a successor Depositary Agent to act until such
time, if any, as a successor Depositary Agent shall have accepted its
appointment as provided above. Any such successor Depositary Agent shall
deliver to each party to this Agreement a written instrument accepting such
appointment and thereupon:
(A) the Company or the Collateral Trustee (as
directed by an Act of Secured Debtholders) shall deliver an entitlement
order, instruction or any other order to the predecessor Depositary
Agent directing it to transfer to the successor Depositary Agent all
balances deposited in and all financial assets and other assets
credited to, the Designated Asset Sale Proceeds Account;
(B) the successor Depositary Agent shall
establish and maintain the Designated Asset Sale Proceeds Account and
deposit in and credit to the Designated Asset Sale Proceeds Account all
financial assets and other assets from the Designated Asset Sale
Proceeds Account maintained by the predecessor Depositary Agent
transferred by the predecessor Depositary Agent to the successor
Depositary Agent; and
15
(C) the successor Depositary Agent shall succeed
to all the rights and duties of the Depositary Agent under this
Agreement and under applicable law.
(iii) In the event of any resignation of the
Depositary Agent, a successor Depositary Agent, which shall be a bank or
trust company organized under the laws of the United States of America or
of any state thereof capable of acting as a "securities intermediary"
(within the meaning of Section 8-102(a)(14) of the UCC) and a "bank"
(within the meaning of Section 9-102(a)(8) of the UCC) and having a capital
and surplus of not less than $50,000,000, shall be appointed by the
Company. Any such successor Depositary Agent shall deliver to each party to
this Agreement a written instrument accepting such appointment and
thereupon:
(A) the Company or the Collateral Trustee (as
directed by an Act of Secured Debtholders) shall deliver an entitlement
order, instruction or any other order to the predecessor Depositary
Agent directing it to transfer to the Collateral Trustee all balances
deposited in and all financial assets credited to, the Designated Asset
Sale Proceeds Account;
(B) the successor Depositary Agent shall
establish and maintain at its New York office the Designated Asset Sale
Proceeds Account and deposit in and credit to the Designated Asset Sale
Proceeds Account all financial assets and other assets from the
Designated Asset Sale Proceeds Account maintained by the predecessor
Depositary Agent transferred by the predecessor Depositary Agent to the
successor Depositary Agent; and
(C) the successor Depositary Agent shall succeed
to all the rights and duties of the Depositary Agent under this
Agreement and under applicable law.
(iv) In the event that a successor Depositary Agent is not
appointed after such notice of resignation of the Depositary Agent, the
then current Depositary Agent shall fulfill its obligations hereunder until
a successor Depositary Agent meeting the requirements of this Section 3.04
has accepted its appointment as Depositary Agent and the provisions of this
Section 3.04 have been satisfied.
In the event of the resignation or termination of the Depositary Agent, the
Depositary Agent shall be entitled to its fees and expenses in accordance with
the terms hereof up to the time such resignation becomes effective in accordance
with this Section 3.04(j).
(k) General.
(i) No provision of this Agreement shall require the
Depositary Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or
in the exercise of any of its rights or powers (except to the extent
resulting from the gross negligence or willful misconduct of
16
the Depositary Agent) and unless it has been furnished with an indemnity
reasonably satisfactory to it.
(ii) All written directions and instructions (which may be
provided by facsimile transmission) by the Company or the Collateral
Trustee to the Depository Agent pursuant to this Agreement shall be
executed by an authorized signatory of the Company or the Collateral
Trustee, as applicable.
(iii) The Depository Agent shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, or any other evidence of
indebtedness or other paper or document, but the Depositary Agent, in its
discretion, may make further inquiry or investigation into such facts or
matters as it may see fit.
(iv) The Depository Agent shall not be liable for any
action taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement.
(v) The Depositary Agent shall not be deemed to have
notice of any Actionable Default unless a Responsible Officer of the
Depositary Agent has actual knowledge thereof or unless written notice
thereof is received by the Depositary Agent.
(vi) The Depositary Agent shall be under no obligation to
notify the Collateral Trustee of any Actionable Default or any other event
except for those events for which this Agreement specifically provides that
such notice is required.
(vii) If any checks, drafts or other items deposited in the
Designated Asset Sale Proceeds Account are returned or unpaid or otherwise
dishonored, the Depositary Agent shall have the right to charge any and all
such returned or dishonored items against the Designated Asset Sale
Proceeds Account or to demand reimbursement therefor directly from the
Company.
(viii) In no event shall the Depositary Agent be liable for
losses or delays resulting from computer malfunction, interruption of
communication facilities, labor difficulties, in each case, that are beyond
the Depositary Agent's reasonable control or other causes beyond the
Depositary Agent's reasonable control or for indirect, special or
consequential damages.
SECTION 3.05. Remedies. If an Actionable Default shall have occurred and be
continuing:
(i) the Collateral Trustee may exercise in respect of the
Designated Asset Sale Proceeds Account, in addition to other rights and
remedies provided for herein or otherwise available to it, all the rights
and remedies of a secured party on default under
17
the UCC at that time and consistent with the provisions of the other
Secured Debt Documents, including the right to proceed to protect and
enforce the rights vested in it by this Agreement, to sell, liquidate or
otherwise dispose of the Designated Asset Sale Proceeds Account, and to
cause the Designated Asset Sale Proceeds Account to be sold, liquidated or
otherwise disposed of, in each case in such manner as the Collateral
Trustee may elect; and
(ii) the proceeds of any financial assets and other assets
credited to or held in the Designated Asset Sale Proceeds Account and all
cash proceeds received by the Collateral Trustee in respect of any sale of,
collection from or other realization upon all or any part of the Designated
Asset Sale Proceeds Account shall be applied in accordance with the
provisions of Section 3.4 of the Collateral Trust Agreement.
No right, power or remedy herein conferred upon or reserved to the Collateral
Trustee is intended to be exclusive of any other right, power or remedy and
every such right, power and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right, power and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder or otherwise shall not
prevent the concurrent assertion or employment of any other appropriate right or
remedy. Resort to any or all security now or hereafter held by the Collateral
Trustee may be taken concurrently or successively and in one or several
consolidated or independent judicial actions or lawfully taken nonjudicial
proceedings, or both.
ARTICLE IV
TERMINATION OF AGREEMENT
SECTION 4.01. Rights and Obligations of Collateral Trustee and Depositary
Agent. The rights and powers granted herein to the Collateral Trustee have been
granted in order, among other things, to perfect its security interests in the
Designated Asset Sale Proceeds Account, are powers coupled with an interest, and
will neither be affected by the bankruptcy of the Company nor by the lapse of
time. Except as otherwise provided herein, the obligations of the Depositary
Agent hereunder shall continue in effect until the security interests of the
Collateral Trustee in the Designated Asset Sale Proceeds Account have been
terminated pursuant to the terms of this Agreement and the other Secured Debt
Documents, and the Collateral Trustee has notified the Depositary Agent of such
termination in writing.
SECTION 4.02. Secured Obligations. When each of the Secured Debt Documents
has expired or has otherwise terminated, all Secured Obligations of the Company
to the Secured Parties under each of the Secured Debt Documents have been paid
in full and all commitments to extend credit under all Credit Facilities the
Indebtedness under which constitutes Priority Lien Debt have been terminated,
all right, title and interest of the Collateral Trustee in the Designated Asset
Sale Proceeds Account shall be released in accordance with the Collateral Trust
Agreement. At such time, the Collateral Trustee shall notify the Depositary
Agent in writing using the form attached hereto as Exhibit A to, and upon such
notification the Depositary Agent
18
shall, pay any amounts (including Cash Equivalents) then remaining in the
applicable Designated Asset Sale Proceeds Account to the Company. No termination
of any interest of a Secured Party hereunder shall affect the rights of any
other Secured Party hereunder.
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Notices. Any communications, including notices and
instructions, between the parties hereto or notices provided herein to be given
may be given to the following addresses:
If to the Collateral Trustee: The Bank of New York
101 Barclay Street, Floor 8 West
New York, NY 10286
Attention: Corporate Trust
Administration
Fax: 212-815-5704
If to the Company: Calpine Corporation
50 West San Fernando Street
San Jose, CA 95113
Attention: Corporate Treasurer
Fax: 408-995-0505
If to the Depositary Agent: Union Bank of California, N.A.
120 South San Pedro Street, Suite 400
Los Angeles, CA
Attention: Corporate Trust
Administration
Fax: 213-972-5694
Each notice hereunder shall be in writing and may be personally served or sent
by facsimile or United States mail or courier service and shall be deemed to
have been given when delivered in person or by courier service and signed for
against receipt thereof, upon receipt of facsimile, or three Business Days after
depositing it in the United States mail with postage prepaid and properly
addressed. Any party shall have the right to change its address for notice
hereunder to any other location within the continental United States by giving
of 30 days' notice to the other parties in the manner set forth hereinabove.
SECTION 5.02. Benefit of Agreement. Nothing in this Agreement, expressed or
implied, shall give or be construed to give to any Person other than the parties
hereto, the Secured Parties, any legal or equitable right, remedy or claim under
this Agreement, or under any covenants and provisions of this Agreement, each
such covenant and provision being for the sole benefit of the parties hereto and
the Secured Parties.
19
SECTION 5.03. No Waiver; Remedies Cumulative. No failure or delay on the
part of the Collateral Trustee or the Depositary Agent in the exercise of any
power, right or privilege hereunder or under any other Secured Debt Document
shall impair such power, right or privilege or be construed to be a waiver of
any default or acquiescence therein, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further exercise thereof or
of any other power, right or privilege. The rights, powers and remedies given to
the Collateral Trustee and the Depositary Agent hereby are cumulative and shall
be in addition to and independent of all rights, powers and remedies existing by
virtue of any statute or rule of law or in any of the other Secured Debt
Documents. Any forbearance or failure to exercise, and any delay in exercising,
any right, power or remedy hereunder shall not impair any such right, power or
remedy or be construed to be a waiver thereof, nor shall it preclude the further
exercise of any such right, power or remedy.
SECTION 5.04. Severability. In case any provision in or obligation hereunder
shall be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
SECTION 5.05. Amendments. This Agreement may not be amended, modified or
supplemented, except in a writing signed by each of the parties hereto and in
accordance with Section 7.1 of the Collateral Trust Agreement.
SECTION 5.06. Headings. Section headings herein are included herein for
convenience of reference only and shall not constitute a part hereof for any
other purpose or be given any substantive effect.
SECTION 5.07. Governing Law. This Agreement, including all matters of
construction, validity, performance and the creation, validity, enforcement or
priority of the lien of, and security interests created by, this Agreement in or
upon the Designated Asset Sale Proceeds Account shall be governed by the laws of
the State of New York, without reference to conflicts of law (other than Section
5-1401 of the New York General Obligations Law), except as required by mandatory
provisions of law and except to the extent that the validity or perfection of
the lien and security interest hereunder, or remedies hereunder, in respect of
the Designated Asset Sale Proceeds Account are governed by the laws of a
jurisdiction other than the State of New York. Regardless of any provision in
any other agreement, for purposes of the UCC, the jurisdiction of the Depositary
Agent as securities intermediary (under Section 8-110(e) of the UCC) and as bank
(under Section 9-304(b) of the UCC) with respect to the Designated Asset Sale
Proceeds Account is the State of New York.
SECTION 5.08. CONSENT TO JURISDICTION. ALL JUDICIAL PROCEEDINGS BROUGHT
AGAINST ANY PARTY HERETO ARISING OUT OF OR RELATING HERETO OR ANY OTHER SECURED
DEBT DOCUMENT, OR ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL
COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY
EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY
20
HERETO, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (A)
ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF
SUCH COURTS; (B) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (C) AGREES THAT
SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY
REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE
OBLIGOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 5.01; (D) AGREES THAT
SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO CONFER PERSONAL
JURISDICTION OVER THE APPLICABLE OBLIGOR IN ANY SUCH PROCEEDING IN ANY SUCH
COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;
AND (E) AGREES AGENTS AND SECURED PARTIES RETAIN THE RIGHT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY OBLIGOR IN
THE COURTS OF ANY OTHER JURISDICTION.
SECTION 5.09. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES
TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER TERM LOAN DOCUMENTS OR
NOTE DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF
THIS CONTROL AGREEMENT OR THE LENDER/COMPANY RELATIONSHIP THAT IS BEING
ESTABLISHED. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY
AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT
MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF
DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO
ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS
AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED
FUTURE DEALINGS. EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS
REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND
VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY
REFERRING TO THIS SECTION AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS HERETO OR ANY OF THE OTHER SECURED DEBT DOCUMENTS OR TO ANY OTHER
DOCUMENTS OR AGREEMENTS RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT. IN THE
EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL
BY THE COURT.
21
SECTION 5.10. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns, provided that (a) the Company may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of the Collateral Trustee (which consent may be withheld in its sole
discretion) and (b) the Depositary Agent may only assign or otherwise transfer
any of its rights or obligations hereunder in accordance with the terms of this
Agreement.
SECTION 5.11. Entire Agreement. This Agreement and any agreement, document
or instrument attached hereto or referred to herein among the parties hereto
integrate all the terms and conditions mentioned herein or incidental hereto and
supersede all oral negotiations and prior writings in respect of the subject
matter hereof. In the event of any conflict between the terms, conditions and
provisions of this Agreement and any such agreement, document or instrument, the
terms, conditions and provisions of this Agreement shall prevail. In the event
of any conflict between this Agreement (or any portion hereof) and any other
agreement now existing or hereafter entered into with respect to the Designated
Asset Sale Proceeds Account, the terms of this Agreement shall prevail.
SECTION 5.12. Survival of Agreements. The provisions regarding the payment
of expenses and indemnification obligations, including Section 3.04(h) and the
provisions set forth in Sections 3.04(j) and 5.14, and in the event that the
Depositary Agent resigns in accordance with Section 3.04(j)(iii) or 3.04(j)(iv),
Article 2 shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the expiration or
termination of each of the Secured Debt Documents, the payment in full of all
Secured Obligations of the Company to the Secured Parties under each of the
Secured Debt Documents and the termination or expiration of all commitments to
extend credit under all Credit Facilities the Indebtedness under which
constitutes Priority Lien Debt.
SECTION 5.13. Further Information. The Depositary Agent shall promptly provide
the Collateral Trustee and the Company with any information reasonably requested
by the Collateral Trustee or the Company concerning balances in the Designated
Asset Sale Proceeds Account and payments from the Designated Asset Sale Proceeds
Account.
SECTION 5.14. Additional Depositary Agent Provisions. The Depositary Agent may
engage or be interested in any financial or other transactions with any party to
this Agreement and may act on, or as depositary, trustee or agent for, any
committee or body of holders of obligations of such Persons as freely as if it
were not the Depositary Agent hereunder. The Depositary Agent shall act as an
agent only and shall not be responsible or liable in any manner for soliciting
any funds or for the sufficiency, correctness, genuineness or validity of any
funds or securities deposited with or held by it, except in the case of its
gross negligence or willful misconduct. The Depositary Agent shall not be liable
for any error of judgment or for any act done or step taken or omitted except in
the case of its gross negligence or willful misconduct. In the event of any
dispute as to the construction or interpretation of any provision of this
Agreement, the Depository Agent may consult with counsel of its own selection
and the opinion
22
of such counsel shall be full and complete authorization and protection in
respect of any action taken suffered or omitted by it hereunder in good faith
and reliance thereon.
SECTION 5.15. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. The delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof.
SECTION 5.16. Effectiveness. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto and receipt by
the Company, the Depositary Agent and the Collateral Trustee of written
notification of such execution and authorization of delivery thereof.
SECTION 5.17. Collateral Trustee's Obligations. Notwithstanding anything to
the contrary contained in this Agreement, in acting under and by virtue of this
Agreement, the Collateral Trustee shall be entitled to all of the rights,
privileges and immunities provided to it under the Collateral Trust Agreement,
and the performance by the Collateral Trustee of its obligations under this
Agreement and the exercise of its rights hereunder is subject in all respects to
the provisions of the Collateral Trust Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
23
IN WITNESS WHEREOF, the parties hereto, by their officers duly
authorized, intending to be legally bound, have caused this Depositary Agreement
to be duly executed and delivered as of the date first above written.
CALPINE CORPORATION
By: /s/ ANN B. CURTIS
--------------------------------------------
Name: Ann B. Curtis
Title: Executive Vice President, Secretary
and Co-Chairman of the Board
THE BANK OF NEW YORK, not in its individual
capacity, but solely as the Collateral Trustee
By: /s/ MICHAEL PITFICK
--------------------------------------------
Name: Michael Pitfick
Title: Assistant Vice President
UNION BANK OF CALIFORNIA, N.A.,
as Depositary Agent
By: /s/ LORRAINE MCINTIRE
--------------------------------------------
Name: Lorraine McIntire
Title: Vice President
[Depositary Agreement Signature Page]
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EXHIBIT A
DATE: _____________________
UNION BANK OF CALIFORNIA, N.A.
ADDRESS: 120 SOUTH SAN PEDRO STREET,
SUITE 400
LOS ANGELES, CALIFORNIA
ATTENTION: CORPORATE TRUST DEPARTMENT
PHONE: 213-972-5675
FAX: 213-972-5694
RE: DESIGNATED ASSET SALE PROCEEDS ACCOUNT
CONTROL AGREEMENT DATED JULY 16, 2003;
DESIGNATED ASSET SALE PROCEEDS ACCOUNT
LADIES AND GENTLEMEN:
REFERENCE IS MADE TO THE DESIGNATED ASSET SALE PROCEEDS ACCOUNT CONTROL
AGREEMENT DATED JULY 16, 2003 (THE "AGREEMENT"; CAPITALIZED TERMS USED HEREIN
SHALL HAVE THE MEANINGS ASSIGNED THERETO IN THE AGREEMENT) AMONG THE BANK OF NEW
YORK (THE "COLLATERAL TRUSTEE"), UNION BANK OF CALIFORNIA, N.A. (THE "DEPOSITARY
AGENT") AND CALPINE CORPORATION (THE "COMPANY"). THIS LETTER CONSTITUTES AN
INSTRUCTION UNDER THE AGREEMENT.
You are hereby instructed and authorized to remit: Written $ Amount US _________
Numeric $ Amount $________
VIA WIRE TRANSFER TO: ACCOUNT #: __________ ABA # _________________
ACCOUNT NAME: ____________________________________
ATTENTION: ____________________________________
FROM THE DESIGNATED ASSET SALES PROCEEDS MAINTAINED AT UNION
ACCOUNT # 6711713800 __________ BANK OF CALIFORNIA, N.A.
THE UNDERSIGNED REPRESENTS AND WARRANTS TO THE DEPOSITARY AGENT THAT
THE UNDERSIGNED IS AN AUTHORIZED SIGNATORY OF COLLATERAL TRUSTEE.
COLLATERAL TRUSTEE
BY: __________________________________
NAME: __________________________________
TITLE: __________________________________
Dates Referenced Herein and Documents Incorporated by Reference
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