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Exhibit 4.15
GUARANTEE AGREEMENT
KeySpan Trust __
Dated as of _________ ___, ______
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CROSS REFERENCE TABLE*
Section of Trust Section of
Indenture Act of Guarantee
1939, as amended Agreement
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310(a).......................................................................................................4.1(a)
310(b)..................................................................................................2.8; 4.1(c)
310(c).................................................................................................Inapplicable
311(a).......................................................................................................2.2(b)
311(b).......................................................................................................2.2(b)
311(c).................................................................................................Inapplicable
312(a)..................................................................................................2.2(a); 2.9
312(b)..................................................................................................2.2(b); 2.9
312(c)..........................................................................................................2.9
313(a)..........................................................................................................2.3
313(b)..........................................................................................................2.3
313(c)..........................................................................................................2.3
313(d)..........................................................................................................2.3
314(a)..........................................................................................................2.4
314(b).................................................................................................Inapplicable
314(c)..........................................................................................................2.5
314(d).................................................................................................Inapplicable
314(e)..........................................................................................................2.5
314(f).................................................................................................Inapplicable
315(a)...............................................................................................3.1(d); 3.2(a)
315(b).......................................................................................................2.7(a)
315(c).......................................................................................................3.1(c)
315(d).......................................................................................................3.1(d)
316(a)..................................................................................................2.6; 5.4(a)
316(b)......................................................................................................... 5.3
316(c)................................................................................................ Inapplicable
317(a).........................................................................................................2.10
317(b).................................................................................................Inapplicable
318(a).......................................................................................................2.1(b)
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*This Cross-Reference Table does not
constitute part of the Agreement and shall
not have any bearing upon the interpretation
of any of its terms or provisions.
Table of Contents
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS........................................1
SECTION 1.1 Interpretation and Definitions..............................................................1
ARTICLE II
TRUST INDENTURE ACT.............................................4
SECTION 2.1 Trust Indenture Act; Application............................................................4
SECTION 2.2 Lists of Holders of Securities..............................................................4
SECTION 2.3 Reports by Guarantee Trustee................................................................5
SECTION 2.4 Periodic Reports to Guarantee Trustee.......................................................5
SECTION 2.5 Evidence of Compliance with Conditions Precedent............................................5
SECTION 2.6 Guarantee Event of Default; Waiver..........................................................5
SECTION 2.7 Guarantee Event of Default; Notice..........................................................5
SECTION 2.8 Conflicting Interests.......................................................................6
SECTION 2.9 Disclosure of Information...................................................................6
SECTION 2.10 Guarantee Trustee May File Proofs of Claim..................................................6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE................................6
SECTION 3.1 Powers and Duties of Guarantee Trustee......................................................6
SECTION 3.2 Certain Rights of Guarantee Trustee.........................................................8
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee.......................................9
ARTICLE IV
GUARANTEE TRUSTEE..............................................9
SECTION 4.1 Guarantee Trustee; Eligibility..............................................................9
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee..................................10
ARTICLE V
GUARANTEE.................................................11
SECTION 5.1 Guarantee..................................................................................11
SECTION 5.2 Waiver of Notice and Demand................................................................11
SECTION 5.3 Obligations Not Affected...................................................................11
SECTION 5.4 Rights of Holders..........................................................................12
SECTION 5.5 Guarantee of Payment.......................................................................12
SECTION 5.6 Subrogation................................................................................13
SECTION 5.7 Independent Obligations....................................................................13
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION.................................13
SECTION 6.1 Limitation of Transactions.................................................................13
SECTION 6.2 Ranking....................................................................................13
SECTION 6.3 Subordination of Common Securities.........................................................14
ARTICLE VII
TERMINATION................................................14
SECTION 7.1 Termination................................................................................14
ARTICLE VIII
INDEMNIFICATION..............................................14
SECTION 8.1 Exculpation................................................................................14
SECTION 8.2 Indemnification............................................................................14
ARTICLE IX
MISCELLANEOUS...............................................15
SECTION 9.1 Successors and Assigns.....................................................................15
SECTION 9.2 Amendments.................................................................................15
SECTION 9.3 Notices....................................................................................15
SECTION 9.4 Benefit....................................................................................16
SECTION 9.5 Governing Law..............................................................................16
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Guarantee"), dated as of
________ ___, _____, is executed and delivered by KeySpan Corporation, a New
York corporation (the "Guarantor"), and JPMorgan Chase Bank, as trustee (the
"Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Securities (as defined herein) of KeySpan Trust __, a
Delaware statutory business trust (the "Trust").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, pursuant to the Declaration (as defined herein), the
Trust is issuing on the date hereof $_____________ aggregate liquidation amount
of preferred securities, having a liquidation amount of $____ per security and
designated the ____% Preferred Securities of the Trust (the "Preferred
Securities") and $_____________ aggregate liquidation amount of common
securities, having a liquidation amount of $___ per security and designated the
____% Common Securities of the Trust (the "Common Securities" and, together with
the Preferred Securities, the "Securities");
WHEREAS, as incentive for the Holders to purchase the
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Guarantee, to pay to the Holders of the Securities
the Guarantee Payments (as defined herein) and to make certain other payments on
the terms and conditions set forth herein; and that if a Trust Enforcement Event
(as defined herein) has occurred and is continuing, the rights of holders of the
Common Securities to receive Guarantee Payments under this Guarantee are
subordinated to the rights of Holders of Preferred Securities to receive
Guarantee Payments under this Guarantee.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee for the
benefit of the Holders.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions. In this Guarantee, unless the
context otherwise requires:
(a) capitalized terms used in this Guarantee but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Guarantee has the same meaning
throughout;
(c) all references to "the Guarantee" or "this Guarantee" are to this
Guarantee as modified, supplemented or amended from time to time;
(d) all references in this Guarantee to Articles, Sections and Recitals are
to Articles, Sections and Recitals of this Guarantee, unless otherwise
specified;
(e) unless otherwise defined in this Guarantee, a term defined in the Trust
Indenture Act has the same meaning when used in this Guarantee;
(f) a reference to the singular includes the plural and vice versa and a
reference to any masculine form of a term shall include the feminine form of a
term, as applicable; and
(g) the following terms have the following meanings:
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" has the meaning specified in the Declaration.
"Common Securities" has the meaning specified in the Recitals
hereto.
"Corporate Trust Office" means the principal office of the
Guarantee Trustee at which at any particular time its corporate trust business
shall be administered, which office at the date of execution of this Guarantee
is located at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Covered Person" means a Holder or beneficial owner of
Securities.
"Debentures" means the series of subordinated deferrable
interest debentures to be issued by the Guarantor designated the ____%
Subordinated Deferrable Interest Debentures due 20__ held by the Property
Trustee (as defined in the Declaration) of the Trust.
"Declaration" means the Amended and Restated Declaration of
Trust, dated as of ____________ ___, _____, as amended, modified or supplemented
from time to time, among the trustees of the Trust named therein, the Guarantor,
as sponsor, and the Holders, from time to time, of undivided beneficial
ownership interests in the assets of the Trust.
"Global Security" means a fully registered, global Preferred
Security.
"Guarantee Event of Default" means a default by the Guarantor
on any of its payment or other obligations under this Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Securities, to the
extent not paid by or on behalf of the Trust: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) that are required to be paid on
such Securities to the extent the Trust has sufficient funds available therefor
at the time, (ii) the redemption price, including all accumulated and unpaid
Distributions to the date of redemption, with respect to any Securities called
for redemption by the Trust, to the extent the Trust shall have sufficient funds
available therefor at the time or (iii) upon a voluntary or involuntary
dissolution, winding-up or termination of the Trust (other than in connection
with the distribution of Debentures to the Holders in exchange for Securities as
provided in the Declaration), the lesser of (a) the aggregate of the liquidation
amount and all accumulated and unpaid Distributions on the Securities to the
date of payment, to the extent the Trust has sufficient funds available therefor
and (b) the amount of assets of the Trust remaining available for distribution
to Holders in liquidation of the Trust (in either case, the "Liquidation
Distribution").
"Guarantee Trustee" means JPMorgan Chase Bank, until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee and thereafter means each such Successor
Guarantee Trustee.
"Holder" means any holder of Securities, as registered on the
books and records of the Trust; provided, however, that, in determining whether
the Holders of the requisite liquidation amount of Preferred Securities have
voted on any matter provided for in this Guarantee, then for the purpose of such
determination only (and not for any other purpose hereunder), if the Preferred
Securities remain in the form of one or more Global Certificates (as defined in
the Declaration), the term "Holders" shall mean the holder of the Global
Certificate acting at the direction of the Beneficial Owners (as defined in the
Declaration).
"Indemnified Person" means the Guarantee Trustee, any
Affiliate of the Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodians or agents of
the Guarantee Trustee.
"Indenture" means the Indenture, dated as of [November 1,
2000][_________, 2002], between the Guarantor (the "Company") and JPMorgan Chase
Bank [(as successor to The Chase Manhattan Bank)], as trustee, as amended and
supplemented by any other indenture thereto pursuant to which the Debentures are
to be issued to the Property Trustee (as defined in the Declaration) of the
Trust.
"Majority in Liquidation Amount" means, except as provided in
the terms of the Preferred Securities or by the Trust Indenture Act, Holder(s)
of outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities, voting separately as a class, who are the record
owners of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant class.
In determining whether the Holders of the requisite amount of Securities have
voted, Securities which are owned by the Guarantor or any Affiliate of the
Guarantor or any other obligor on the Securities shall be disregarded for the
purpose of any such determination.
"Officers' Certificate" means, with respect to any Person, a
certificate signed on behalf of such Person by two Authorized Officers (as
defined in the Declaration) of such Person. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Guarantee shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer on behalf of such Person in rendering
the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
on behalf of such Person to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer acting
on behalf of such Person, such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Securities" has the meaning specified in the
Recitals hereto.
"Redemption Price" has the meaning specified in the
Declaration.
"Responsible Officer" means, with respect to the Guarantee
Trustee, any officer with direct responsibility for the administration of this
Guarantee and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Securities" has the meaning specified in the Recitals hereto.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Enforcement Event" in respect of the Securities means
an Indenture Event of Default (as defined in the Indenture) has occurred and is
continuing in respect of the Debentures.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application. (a) This Guarantee is subject
to the provisions of the Trust Indenture Act that are required to be part of
this Guarantee and shall, to the extent applicable, be governed by such
provisions.
(b) If and to the extent that any provision of this Guarantee limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities. (a) The Guarantor shall provide
the Guarantee Trustee (i) except while the Preferred Securities are represented
by one or more Global Securities at least one Business Day prior to the date for
payment of Distributions, a list, in such form as the Guarantee Trustee may
reasonably require, of the names and addresses of the Holders of the Securities
("List of Holders") as of the record date relating to the payment of such
Distributions, and (ii) at any other time, within 30 days of receipt by the
Guarantor of a written request from the Guarantee Trustee for a List of Holders
as of a date no more than 15 days before such List of Holders is given to the
Guarantee Trustee; provided that the Guarantor shall not be obligated to provide
such List of Holders at any time the List of Holders does not differ from the
most recent List of Holders given to the Guarantee Trustee by the Guarantor. The
Guarantee Trustee shall preserve, in as current a form as is reasonably
practicable, all information contained in Lists of Holders given to it, provided
that the Guarantee Trustee may destroy any List of Holders previously given to
it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under Sections
311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by Guarantee Trustee. Within 60 days after May 15 of
each year (commencing with the year of the first anniversary of the issuance of
the Securities), the Guarantee Trustee shall provide to the Holders of the
Securities such reports as are required by Section 313 of the Trust Indenture
Act (if any) in the form and in the manner provided by Section 313 of the Trust
Indenture Act. The Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee. The Guarantor shall
provide to the Guarantee Trustee such documents, reports and information as
required by Section 314(a) (if any) of the Trust Indenture Act and the
compliance certificate required by Section 314(a) of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314(a) of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent. The Guarantor
shall provide to the Guarantee Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Guarantee that relate to any
of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Guarantee Event of Default; Waiver. The Holders of a Majority
in Liquidation Amount of the Securities may, by vote or written consent, on
behalf of the Holders of all of the Securities, waive any past Guarantee Event
of Default and its consequences. Upon such waiver, any such Guarantee Event of
Default shall cease to exist, and any Guarantee Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee, but no such waiver shall extend to any subsequent or other default or
Guarantee Event of Default or impair any right consequent thereon.
SECTION 2.7 Guarantee Event of Default; Notice. (a) The Guarantee Trustee
shall, within 90 days after the occurrence of a Guarantee Event of Default,
transmit by mail, first class postage prepaid, to the Holders of the Securities,
notices of all Guarantee Events of Default actually known to a Responsible
Officer of the Guarantee Trustee, unless such defaults have been cured before
the giving of such notice; provided, that the Guarantee Trustee shall be
protected in withholding such notice if and so long as a Responsible Officer of
the Guarantee Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of the Securities.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any
Guarantee Event of Default unless the Guarantee Trustee shall have received
written notice thereof or a Responsible Officer of the Guarantee Trustee charged
with the administration of the Declaration shall have obtained actual knowledge
thereof.
SECTION 2.8 Conflicting Interests. The Declaration shall be deemed to be
specifically described in this Guarantee for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act. In
determining whether the Guarantee Trustee has a conflicting interest as defined
in Section 310(b) of the Trust Indenture Act with respect to the Securities of
any series, there shall be excluded [(i)] all series of securities issuable
under the Indenture, dated as of [November 1, 2000][__________, 2002], among
KeySpan Corporation, as issuer, and JPMorgan Chase Bank [(as successor to The
Chase Manhattan Bank)], as trustee[, including the 7.25% Notes due 2005, the
7.625% Notes due 2010, the 8.00% Notes due 2030 and the 6.15% Notes due 2006 and
(ii) all series of securities issuable under the Indenture, dated as of December
1, 1999, among the KeySpan Gas East Corporation, as issuer, the Company, as
guarantor, and JPMorgan Chase Bank (as successor to The Chase Manhattan Bank),
as trustee, including the 7.875% Notes due 2010 issued thereunder].
SECTION 2.9 Disclosure of Information. The disclosure of information as to
the names and addresses of the Holders of the Securities in accordance with
Section 312 of the Trust Indenture Act, regardless of the source from which such
information was derived, shall not be deemed to be a violation of any existing
law, or any law hereafter enacted which does not specifically refer to Section
312 of the Trust Indenture Act, nor shall the Guarantee Trustee be held
accountable by reason of mailing any material pursuant to a request made under
Section 312(b) of the Trust Indenture Act.
SECTION 2.10 Guarantee Trustee May File Proofs of Claim. Upon the
occurrence of a Guarantee Event of Default, the Guarantee Trustee is hereby
authorized to (a) recover judgment, in its own name and as trustee of an express
trust, against the Guarantor for the whole amount of any Guarantee Payments
remaining unpaid and (b) file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have its claims and those of the
Holders of the Securities allowed in any judicial proceedings relative to the
Guarantor, its creditors or its property.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of Guarantee Trustee. (a) This Guarantee
shall be held by the Guarantee Trustee on behalf of the Trust for the benefit of
the Holders of the Securities, and the Guarantee Trustee shall not transfer this
Guarantee to any Person except a Holder of Securities exercising his or her
rights pursuant to Section 5.4(b) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee. The right, title and interest of the Guarantee
Trustee in and to this Guarantee shall automatically vest in any Successor
Guarantee Trustee, and such vesting and succession of title shall be effective
whether or not conveyance documents have been executed and delivered pursuant to
the appointment of such Successor Guarantee Trustee.
(b) If a Guarantee Event of Default actually known to a Responsible Officer
of the Guarantee Trustee has occurred and is continuing, the Guarantee Trustee
shall enforce this Guarantee for the benefit of the Holders of the Securities.
(c) The Guarantee Trustee, before the occurrence of any Guarantee Event of
Default and after the curing of all Guarantee Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee, and no implied covenants shall be read into this
Guarantee against the Guarantee Trustee. In case a Guarantee Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Guarantee Trustee, the Guarantee
Trustee shall exercise such of the rights and powers vested in it by this
Guarantee, and use the same degree of care and skill in its exercise thereof, as
a prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(d) No provision of this Guarantee shall be construed to relieve the
Guarantee Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Guarantee Event of Default and after the
curing or waiving of all such Guarantee Events of Default that may have
occurred:
(A) the duties and obligations of the Guarantee Trustee shall be
determined solely by the express provisions of this Guarantee, and the
Guarantee Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this Guarantee, and
no implied covenants or obligations shall be read into this Guarantee
against the Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Guarantee Trustee,
the Guarantee Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Guarantee Trustee and conforming
to the requirements of this Guarantee; but in the case of any such
certificates or opinions that by any provision hereof are specifically
required to be furnished to the Guarantee Trustee, the Guarantee Trustee
shall be under a duty to examine the same to determine whether or not they
conform to the requirements of this Guarantee;
(ii) the Guarantee Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Guarantee Trustee, unless it
shall be proved that the Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a Majority in Liquidation Amount of
the Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee, or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee; and
(iv) no provision of this Guarantee shall require the Guarantee Trustee to
expend or risk its own funds or otherwise incur personal financial liability in
the performance of any of its duties or in the exercise of any of its rights or
powers, if the Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds or liability is not reasonably assured to it
under the terms of this Guarantee or if the Guarantee Trustee shall have
reasonable grounds for believing that an indemnity, reasonably satisfactory to
the Guarantee Trustee, against such risk or liability is not reasonably assured
to it under the terms of this Guarantee.
SECTION 3.2 Certain Rights of Guarantee Trustee. (a) Subject to the
provisions of Section 3.1:
(i) The Guarantee Trustee may conclusively rely, and shall be fully
protected in acting or refraining from acting upon, any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed, sent or presented
by the proper party or parties;
(ii) Any direction or act of the Guarantor contemplated by this Guarantee
shall be sufficiently evidenced by an Officers' Certificate;
(iii) Whenever, in the administration of this Guarantee, the Guarantee
Trustee shall deem it desirable that a matter be proved or established before
taking, suffering or omitting any action hereunder, the Guarantee Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be promptly delivered by
the Guarantor;
(iv) The Guarantee Trustee shall have no duty to see to any recording,
filing or registration or any instrument (or any rerecording, refiling or
re-registration thereof);
(v) The Guarantee Trustee may consult with counsel, and the advice or
opinion of such counsel with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with such advice or opinion.
Such counsel may be counsel to the Guarantor or any of its Affiliates and may
include any of its employees. The Guarantee Trustee shall have the right at any
time to seek instructions concerning the administration of this Guarantee from
any court of competent jurisdiction;
(vi) The Guarantee Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Guarantee at the request or direction
of any Holder, unless such Holder shall have provided to the Guarantee Trustee
such security and indemnity, reasonably satisfactory to the Guarantee Trustee,
against the costs, expenses (including attorneys' fees and expenses and the
expenses of the Guarantee Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Guarantee Trustee; provided, that nothing contained in this Section 3.2(a)(vi)
shall be taken to relieve the Guarantee Trustee, upon the occurrence of a
Guarantee Event of Default, of its obligation to exercise the rights and powers
vested in it by this Guarantee;
(vii) The Guarantee Trustee 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, other evidence of indebtedness or other paper or document, but
the Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit;
(viii) The Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, nominees, custodians or attorneys, and the Guarantee Trustee shall not
be responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder;
(ix) Any action taken by the Guarantee Trustee or its agents hereunder
shall bind the Holders, and the signature of the Guarantee Trustee or its agents
alone shall be sufficient and effective to perform any such action. No third
party shall be required to inquire as to the authority of the Guarantee Trustee
to so act or as to its compliance with any of the terms and provisions of this
Guarantee, both of which shall be conclusively evidenced by the Guarantee
Trustee's or its agent's taking such action; and
(x) Whenever in the administration of this Guarantee the Guarantee Trustee
shall deem it desirable to receive instructions with respect to enforcing any
remedy or right or taking any other action hereunder, the Guarantee Trustee (i)
may request written instructions from the Holders of a Majority in Liquidation
Amount of the Securities, (ii) may refrain from enforcing such remedy or right
or taking such other action until such written instructions are received and
(iii) shall be protected in conclusively relying on or acting in accordance with
such written instructions.
(b) No provision of this Guarantee shall be deemed to impose any duty or
obligation on the Guarantee Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it in any jurisdiction
in which it shall be illegal, or in which the Guarantee Trustee shall be
unqualified or incompetent to act in accordance with applicable law, to perform
any such act or acts or to exercise any such right, power, duty or obligation.
No permissive power or authority available to the Guarantee Trustee shall be
construed to be a duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee. The
recitals contained in this Guarantee shall be taken as the statements of the
Guarantor, and the Guarantee Trustee does not assume any responsibility for
their correctness. The Guarantee Trustee makes no representations as to the
validity or sufficiency of this Guarantee.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility. (a) There shall be at all times
a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of the
United States of America or any state or territory thereof or of the District of
Columbia, or a corporation or other Person permitted by the Securities and
Exchange Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least 50 million U.S. dollars ($50,000,000),
and subject to supervision or examination by federal, state, territorial or
District of Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then, for the purposes of
this Section 4.1(a)(ii), the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published.
(b) If at any time the Guarantee Trustee shall cease to be eligible to so
act under Section 4.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee. (a)
Subject to Section 4.2(b), unless a Guarantee Event of Default shall have
occurred and be continuing, the Guarantee Trustee may be appointed or removed
with or without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed in accordance with Section
4.2(a) until a Successor Guarantee Trustee has been appointed and has accepted
such appointment by written instrument executed by such Successor Guarantee
Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed to office shall hold such office until
a Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 30 days after
delivery to the Guarantor of an instrument of removal or resignation, the
removed or resigning Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor Guarantee Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper, appoint
a Successor Guarantee Trustee.
(e) No Guarantee Trustee shall be liable for the acts or omissions to act
of any Successor Guarantee Trustee.
(f) Upon termination of this Guarantee or removal or resignation of the
Guarantee Trustee pursuant to this Section 4.2, the Guarantor shall pay to the
Guarantee Trustee all amounts owing for fees and reimbursement of expenses which
have accrued to the date of such termination, removal or resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee. The Guarantor irrevocably and unconditionally agrees
to pay in full to the Holders the Guarantee Payments (without duplication of
amounts theretofore paid by the Trust), as and when due, regardless of any
defense, right of set-off or counterclaim that the Trust may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Trust to pay such amounts to the Holders. Notwithstanding anything to the
contrary herein, the Guarantor retains all of its rights under the Indenture to
(i) extend the interest payment period on the Debentures and the Guarantor shall
not be obligated hereunder to make any Guarantee Payments during any Extension
Period (as defined in the certificate evidencing the Debentures) with respect to
the Distributions (as defined in the Declaration) on the Securities and (ii)
change the maturity date of the Debentures to the extent permitted by the
Indenture.
SECTION 5.2 Waiver of Notice and Demand. The Guarantor hereby waives notice
of acceptance of this Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Trust or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
SECTION 5.3 Obligations Not Affected. The obligations, covenants,
agreements and duties of the Guarantor under this Guarantee shall be absolute
and unconditional and shall remain in full force and effect until the entire
liquidation amount of all outstanding Securities shall have been paid and such
obligation shall in no way be affected or impaired by reason of the happening
from time to time of any event, including without limitation, the following,
whether or not with notice to, or the consent of, the Guarantor:
(a) The release or waiver, by operation of law or otherwise, of the
performance or observance by the Trust of any express or implied agreement,
covenant, term or condition relating to the Securities to be performed or
observed by the Trust;
(b) The extension of time for the payment by the Trust of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Securities or the extension of time
for the performance of any other obligation under, arising out of, or in
connection with the Securities (other than an extension of time for payment of
Distributions, Redemption Price, Liquidation Distribution or other sum payable
that results from the extension of any interest payment period on the Debentures
or any change to the maturity date of the Debentures permitted by the
Indenture);
(c) Any failure, omission, delay or lack of diligence on the part of the
Property Trustee or the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Property Trustee or the Holders
pursuant to the terms of the Securities, or any action on the part of the Trust
granting indulgence or extension of any kind;
(d) The voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Trust or any of the assets of the
Trust;
(e) Any invalidity of, or defect or deficiency in, the Securities;
(f) The settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) Any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Guarantee Trustee or the
Holders to give notice to, or obtain consent of the Guarantor or any other
Person with respect to the happening of any of the foregoing.
No setoff, counterclaim, reduction or diminution of any
obligation, or any defense of any kind or nature that the Guarantor has or may
have against any Holder shall be available hereunder to the Guarantor against
such Holder to reduce the payments to it under this Guarantee.
SECTION 5.4 Rights of Holders. (a) The Holders of at least a Majority in
Liquidation Amount of the Securities have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Guarantee
Trustee in respect of this Guarantee or to direct the exercise of any trust or
power conferred upon the Guarantee Trustee under this Guarantee.
(b) If the Guarantee Trustee fails to enforce this Guarantee, then any
Holder of Securities may, subject to the subordination provisions of Section
6.2, institute a legal proceeding directly against the Guarantor to enforce the
Guarantee Trustee's rights under this Guarantee without first instituting a
legal proceeding against the Trust, the Guarantee Trustee or any other person or
entity. In addition, if the Guarantor has failed to make a Guarantee Payment, a
Holder of Securities may, subject to the subordination provisions of Section
6.2, directly institute a proceeding against the Guarantor for enforcement of
the Guarantee for such payment to the Holder of the Securities of the principal
of or interest on the Debentures on or after the respective due dates specified
in the Debentures, and the amount of the payment will be based on the Holder's
pro rata share of the amount due and owing on all of the Securities. The
Guarantor hereby waives any right or remedy to require that any action on this
Guarantee be brought first against the Trust or any other person or entity
before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment. This Guarantee creates a guarantee of
payment and not of collection.
SECTION 5.6 Subrogation. The Guarantor shall be subrogated to all (if any)
rights of the Holders of Securities against the Trust in respect of any amounts
paid to such Holders by the Guarantor under this Guarantee; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any right that it may
acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Guarantee, if at the
time of any such payment, any amounts are due and unpaid under this Guarantee.
If any amount shall be paid to the Guarantor in violation of the preceding
sentence, the Guarantor agrees to hold such amount in trust for the Holders and
to pay over such amount to the Guarantee Trustee for the benefit of the Holders.
SECTION 5.7 Independent Obligations. The Guarantor acknowledges that its
obligations hereunder are independent of the obligations of the Trust with
respect to the Securities, and that the Guarantor shall be liable as principal
and as debtor hereunder to make Guarantee Payments pursuant to the terms of this
Guarantee notwithstanding the occurrence of any event referred to in subsections
5.3(a) through 5.3(g), inclusive, hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions. So long as any Securities remain
outstanding, if (i) there shall have occurred an event of default under the
Indenture with respect to the Debentures, (ii) there shall be a Guarantee Event
of Default or (iii) the Guarantor shall have given notice of its election of an
Extension Period as provided in the certificate evidencing the Debentures and
shall not have rescinded such notice, or such Extension Period or any extension
thereof shall be continuing, then the Guarantor shall not, and shall not permit
any subsidiary of the Guarantor, to (x) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Guarantor's capital stock or (y) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Guarantor that rank on a parity with or junior in
interest to the Debentures or make any guarantee payments with respect to any
guarantee by the Guarantor of the debt securities of any subsidiary of the
Guarantor if such guarantee ranks on a parity with or junior in interest to the
Debentures (other than (a) dividends or distributions in common stock of the
Guarantor, (b) payments under this Guarantee, (c) any declaration of a dividend
in connection with the implementation of a shareholders' rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, and (d) purchases of common
stock related to the issuance of common stock or rights under any of the
Guarantor's benefit plans).
SECTION 6.2 Ranking. This Guarantee will constitute an unsecured obligation
of the Guarantor and will rank (i) subordinate and junior in right of payment to
all other liabilities of the Guarantor, (ii) on a parity with the most senior
preferred or preference stock now or hereafter issued by the Guarantor and with
any guarantee now or hereafter entered into by the Guarantor in respect of any
preferred securities of any Affiliate of the Guarantor and (iii) senior to the
Guarantor's common stock. In addition, at all times such obligations will be
structurally subordinated to the liabilities and obligations of the Guarantor's
subsidiaries.
SECTION 6.3 Subordination of Common Securities. If a Trust Enforcement
Event has occurred and is continuing under the Declaration, the rights of the
holders of the Common Securities to receive Guarantee Payments hereunder shall
be subordinated to the rights of the Holders of the Preferred Securities to
receive Guarantee Payments under this Guarantee.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination. This Guarantee shall terminate upon (i) full
payment of the Redemption Price of all Securities, (ii) distribution of the
Debentures to the Holders of all the Securities or (iii) full payment of the
amounts payable in accordance with the Declaration upon liquidation of the
Trust. Notwithstanding the foregoing, this Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any Holder
of Securities must restore payment of any sums paid under the Securities or
under this Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation. (a) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Guarantor or any
Covered Person for any loss, damage, liability, expense or claim incurred by
reason of any act or omission performed or omitted by such Indemnified Person in
good faith in accordance with this Guarantee and in a manner that such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Guarantee or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good faith
upon the records of the Guarantor and upon such information, opinions, reports
or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Securities might properly be paid. SECTION 8.2
Indemnification. The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating, any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 8.2 shall
survive the termination of this Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns. All guarantees and agreements contained
in this Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Securities then outstanding.
SECTION 9.2 Amendments. Except with respect to any changes that do not
materially adversely affect the rights of the Holders (in which case no consent
of the Holders will be required), this Guarantee may not be amended without the
prior approval of the Holders of not less than 66-2/3% of the aggregate
liquidation amount of the Securities. The provisions of Section 11.2 of the
Declaration with respect to meetings of, and action by written consent of, the
Holders of the Securities apply to the giving of such approval.
SECTION 9.3 Notices. All notices provided for in this Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered by
hand, telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Guarantee Trustee, at the Guarantee Trustee's mailing
address set forth below (or such other address as the Guarantee Trustee may give
notice of to the Guarantor and the Holders of the Securities):
JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:________________
Telecopy no.: (000) 000-0000
(b) If given to the Guarantor, at the Guarantor's mailing addresses set
forth below (or such other address as the Guarantor may give notice of to the
Guarantee Trustee and the Holders of the Securities):
KeySpan Corporation
Xxx Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Corporate Counsel
Telecopy no.: _____________
(c) If given to any Holder of Securities, at the address set forth on the
books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 9.4 Benefit. This Guarantee is solely for the benefit of the
Holders of the Securities and, subject to Section 3.1(a), is not separately
transferable from the Securities.
SECTION 9.5 Governing Law. THIS GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, this Guarantee is executed as of the day
and year first above written.
KEYSPAN CORPORATION,
as Guarantor
By:
--------------------------------------
Name:
Title:
JPMORGAN CHASE BANK,
as Guarantee Trustee
By:
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Name:
Title:
