EXHIBIT 10.31
AMENDED AND RESTATED
SECURITY AGREEMENT
AMENDED AND RESTATED SECURITY AGREEMENT, dated as of
December 18, 1996 (this "Security Agreement" or this
"Agreement"), made by PANDA-BRANDYWINE, L.P., a Delaware limited
partnership (together with its successors and assigns, the
"Partnership"), in favor of FLEET NATIONAL BANK (formerly known
as Shawmut Bank Connecticut, National Association), as Security
Agent (the "Security Agent") under the Security Deposit Agreement
(as defined in the Participation Agreement referred to below).
W I T N E S S E T H :
WHEREAS, the Partnership, Panda Brandywine Corporation,
a Delaware corporation and the sole general partner of the
Partnership (the "General Partner") and General Electric Capital
Corporation, a New York corporation ("GE Capital" or the "Owner
Participant"), entered into the Construction Loan Agreement and
Lease Commitment dated as of March 30, 1995 (the "Construction
Loan Agreement") pursuant to which GE Capital (i) provided
construction financing for the Project and (ii) issued the
Letters of Credit as collateral security for certain obligations
of the Partnership under the Power Purchase Agreement;
WHEREAS, the Partnership and the Security Agent, for
the benefit of GE Capital and the Owner Trustee (as defined
below), entered into the Security Agreement dated as of March 30,
1995 (as amended, supplemented or otherwise modified prior to the
date hereof, the "Existing Security Agreement") to secure the
payment and performance by the Partnership of all of its
obligations to GE Capital and the Owner Trustee;
WHEREAS, the Security Agent and the Partnership
executed a First Amendment to the Existing Security Agreement,
dated as of October 30, 1996, providing for the release of
certain Collateral described therein in order to facilitate the
transfer of transmission facilities from the Partnership to the
Power Purchaser;
WHEREAS, as contemplated by the Construction Loan
Agreement, the Partnership and the Owner Trustee are entering
into the Facility Lease and the other Lease Documents pursuant to
which, among other things, the Owner Trustee will lease the
Facility to the Partnership;
WHEREAS, the Owner Participant has elected to fund the
Facility Lease with non-recourse indebtedness as a leveraged
lease and, pursuant to Section 9.12 of the Existing Security
Agreement, the parties hereto have agreed to amend and restate
the Existing Security Agreement subject to the terms and
conditions provided herein;
WHEREAS, the Partnership and GE Capital are entering
into the Letter of Credit Reimbursement Agreement to provide for
the continued issuance by GE Capital of the Letters of Credit;
WHEREAS, in order to set forth the rights and
obligations of the Owner Participant, the Owner Trustee, the
Partnership, the General Partner, the Security Agent, the Loan
Participants and the Administrative Agent, the Indenture Trustee
(each as defined below) in connection with the foregoing
transactions and to describe and provide for the transactions
contemplated thereby, (i) the parties referenced in this recital
are entering into the Participation Agreement, (ii) the Owner
Trustee and the Indenture Trustee are entering into the
Indenture, (iii) certain of the Lessee Security Documents are
being amended and restated pursuant to the Amended and Restated
Agreements and (iv) the Construction Loan Agreement is being
terminated;
WHEREAS, it is a condition precedent to the performance
of certain obligations on the Lease Closing Date that the
Partnership shall have executed and delivered this Security
Agreement to the Security Agent, for the benefit of the Owner
Trustee and GE Capital;
WHEREAS, the Partnership desires to execute this Secu
rity Agreement to satisfy the condition described in the
preceding recital;
WHEREAS, pursuant to the terms of the Amended and
Restated Security Deposit Agreement, dated as of the date hereof,
among the Security Agent, the Partnership, the Owner Trustee, the
Security Agent and the Indenture Trustee (as defined below), the
Security Agent has agreed to act as security agent on behalf of
GE Capital, the Owner Trustee and the Indenture Trustee and to
hold the Collateral for the benefit of GE Capital and the Owner
Trustee (and, by collateral assignment, the Indenture Trustee);
NOW, THEREFORE, in consideration of the premises and
other benefits to the Partnership, the receipt and sufficiency of
which are hereby acknowledged, the Partnership hereby covenants
and agrees with the Security Agent, for the benefit of GE Capital
and the Owner Trustee, as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. The following terms shall
have the meanings herein specified unless the context otherwise
requires. Such definitions shall be equally applicable to the
singular and plural forms of the terms defined. Capitalized
terms used but not defined herein shall have the meanings
assigned to them in Annex A to the Participation Agreement, dated
as of December 18, 1996 (the "Participation Agreement"), among
the Partnership, the General Partner, GE Capital, Fleet National
Bank (formerly known as Shawmut Bank Connecticut, National
Association), a national banking association, not in its
individual capacity but solely as owner trustee (in such
capacity, the "Owner Trustee", including any successor owner
trustee appointed in accordance with the terms of the Trust
Agreement) under the Trust Agreement, and as Security Agent,
First Security Bank, National Association, a national banking
association, not in its individual capacity but solely as
indenture trustee (in such capacity, the "Indenture Trustee")
under the Indenture, Credit Suisse, a bank organized and existing
under the laws of Switzerland, acting by and through its New York
branch ("Credit Suisse"), as administrative agent (in such
capacity, the "Administrative Agent"), and the other entities
listed on Schedule I to the Participation Agreement the "Loan
Participants"). Commercial terms used herein and not otherwise
defined herein or in Annex A to the Participation Agreement shall
have the meaning specified for such terms in the Uniform
Commercial Code as in effect in the State of New York.
"Chattel Paper" shall have the meaning assigned to that
term under the Uniform Commercial Code as in effect in any
relevant jurisdiction.
"Collateral" shall have the meaning specified in
Section 2.1(a).
"Construction Loan Agreement" shall have the meaning
specified in the Recitals to this Security Agreement.
"Contract Rights" shall have the meaning specified in
Section 6.1(c).
"Contracts" shall mean all contracts to which the
Partnership now is, or hereafter will be, bound, or a party,
beneficiary or assignee, including, without limitation, all of
the Project Documents and the contracts and agreements set forth
on Exhibit A hereto and made a part hereof, all exhibits thereto
and all other instruments, agreements and documents executed and
delivered with respect to such contracts, any guarantees or
letters of credit provided to the Partnership to assure the
performance by any party to any contract and all revenues,
damages, rentals, Proceeds and other sums of money due and to
become due from any of the foregoing, as the same may be
modified, supplemented or amended from time to time in accordance
with their terms.
"Document" shall have the meaning assigned that term
under the Uniform Commercial Code as in effect in any relevant
jurisdiction.
"Equipment" shall mean any "equipment", as such term is
defined in the Uniform Commercial Code as in effect in any
relevant jurisdiction, now or hereafter owned or leased by the
Partnership and, in any event, shall include, but shall not be
limited to, all equipment used in connection with the Project,
all machinery, tools, office equipment, furniture, furnishings,
fixtures, vehicles, motor vehicles, and any manuals,
instructions, blueprints, computer software and similar items
which relate to the above, and any and all additions,
substitutions and replacements of any of the foregoing, wherever
located, together with all improvements thereon and all
attachments, components, parts, equipment and accessories
installed thereon or affixed thereto, but excluding property
owned by the Power Purchaser.
"Existing Security Agreement" shall have the meaning
specified in the Recitals to this Security Agreement.
"Expenses" shall have the meaning specified in Section
8.1.
"Facility Lease" shall mean the Facility Lease, dated
as of the date hereof, between the Owner Trustee and the
Partnership, as amended, supplemented or otherwise modified from
time to time.
"Fixtures" shall have the meaning assigned that term
under the Uniform Commercial Code as in effect in any relevant
jurisdiction and in any event shall include all goods now or
hereafter attached to, placed on, or incorporated in the Site,
but excluding property owned by the Power Purchaser.
"General Intangibles" shall mean "general intangibles"
as such term is defined in the Uniform Commercial Code as in
effect in any relevant jurisdiction, now or hereafter owned by
the Partnership and shall include, but not be limited to, all
trademarks, trademark applications, trademark registrations,
tradenames, fictitious business names, business names, company
names, business identifiers, prints, labels, trade styles and
service marks (whether or not registered), including logos and/or
designs, copyrights, patents, patent applications, goodwill of
the Partnership's business symbolized by any of the foregoing,
trade secrets, license rights, license agreements, permits,
franchises, and any rights to tax refunds to which the
Partnership is now or hereafter may be entitled.
"Governmental Actions" shall mean all permits,
authorizations, registrations, consents, approvals, waivers,
exceptions, variances, claims, orders, judgments and decrees,
licenses, exemptions, publications (to the extent legally binding
upon the Partnership, any other Participant or the Project),
filings (other than filings of a purely ministerial nature),
notices to and declarations of or with any Governmental Authority
and shall include, without limitation, all siting, environmental,
construction and operating permits and licenses that are required
for the construction, use and operation of the Project and all
governmental actions set forth on Exhibit B hereto.
"Indemnitee" shall have the meaning specified in
Section 8.1.
"Indenture" shall mean the Trust Indenture and Security
Agreement, dated as of the date hereof, made by the Owner Trustee
in favor of the Indenture Trustee, as amended, supplemented or
otherwise modified from time to time.
"Instrument" shall have the meaning assigned that term
under the Uniform Commercial Code as in effect in any relevant
jurisdiction.
"Inventory" shall mean all of the inventory of the
Partnership of every type or description, including all inventory
as such term is defined in the Uniform Commercial Code as in
effect in any relevant jurisdiction, now owned or hereafter
acquired and wherever located, whether raw, in process or
finished, all materials usable in processing the same and all
documents of title covering any inventory, including but not
limited to work in process, materials used or consumed in the
Partnership's business, now owned or hereafter acquired or
manufactured by the Partnership and held for sale in the ordinary
course of its business; all present and future substitutions
therefore, parts and accessories thereof and all additions
thereto; and all proceeds thereof and products of such inventory
in any form whatsoever.
"Inventory Records" shall mean all books, records and
other property and General Intangibles at any time relating to
the Inventory.
"Lessee Obligations" shall mean all the unpaid
principal amount of, and accrued interest on (including, without
limitation, interest accruing after the maturity of the Letter of
Credit Obligations and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Partnership,
whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Letter of Credit Obligations,
all Rent and other obligations payable by the Partnership under
the Facility Lease, the Participation Agreement and the
Reimbursement Agreement and all other obligations and liabilities
of the Partnership and the Partners to GE Capital, the Owner
Trustee, the Security Agent, the Indenture Trustee, the
Administrative Agent, any Holder or any other Indemnitee, whether
direct or indirect, absolute or contingent, due or to become due,
or now existing or hereafter incurred, which may arise under, out
of, or in connection with, the Facility Lease, the Reimbursement
Agreement, this Agreement, the Participation Agreement, the other
Collateral Security Documents or any other Financing Document and
any other document made, delivered or given in connection
therewith or herewith, whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses
(including, without limitation, fees and disbursements of
counsel) or otherwise.
"Partnership" shall have the meaning specified in the
preamble to this Security Agreement.
"Proceeds" shall mean "proceeds" as such term is
defined in the Uniform Commercial Code as in effect in any
relevant jurisdiction or under other relevant law and, in any
event, shall include, but shall not be limited to, (i) any and
all proceeds of any insurance, indemnity, warranty or guaranty
payable to the Partnership from time to time, and claims for
insurance, indemnity, warranty or guaranty effected or held for
the benefit of the Partnership with respect to any of the
Collateral, (ii) any and all payments (in any form whatsoever)
made or due and payable to the Partnership from time to time in
connection with any requisition, confiscation, condemnation,
seizure or forfeiture of all or any part of the Collateral by any
Governmental Authority (or any person acting under color of
Governmental Authority) and (iii) any and all other amounts from
time to time paid or payable under or in connection with any of
the Collateral.
"Receivables" shall mean any "Account" as such term is
defined in the Uniform Commercial Code as in effect in any
relevant jurisdiction and in any event shall include, but not be
limited to, all of the Partnership's rights to payment for goods
(including, without limitation, steam and electricity) sold or
leased, or services performed, by the Partnership, whether now in
existence or arising from time to time hereafter, including,
without limitation, rights evidenced by an account, note,
contract, security agreement, chattel paper, or other evidence of
indebtedness or security, together with (i) all security pledged,
assigned, hypothecated or granted to or held by the Partnership
to secure the foregoing, (ii) all of the Partnership's right,
title and interest in and to any goods (including, without
limitation, steam and electricity prior to the sale thereof to
the Steam Host or the Power Purchaser, as the case may be), the
sale of which gave rise thereto, (iii) all guarantees,
endorsements and indemnifications on, or of, any of the
foregoing, (iv) all powers of attorney for the execution of any
evidence of indebtedness or security or other writing in
connection therewith, (v) all books, correspondence, credit
files, records, ledger cards, invoices, and other papers relating
thereto, including without limitation all similar information
stored on a magnetic medium or other similar storage device and
other papers and documents in the possession or under the control
of the Partnership or any computer bureau from time to time
acting for the Partnership, (vi) all evidences of the filing of
financing statements and other statements and the registration of
other instruments in connection therewith and amendments thereto,
notices to other creditors or secured parties, and certificates
from filing or other registration officers, (vii) all credit
information, reports and memoranda relating thereto, and (viii)
all other writings related in any way to the foregoing.
"Security Agreement" shall mean this Security Agree
ment, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.
ARTICLE II
ASSIGNMENT AND GRANT OF SECURITY INTERESTS
Section 2.1 Assignment and Grant of Security
Interest. (a) As collateral security for the prompt and com
plete payment and performance when due of all of the Lessee
Obligations, the Partnership hereby assigns and grants to the
Security Agent, for the benefit of GE Capital and the Owner
Trustee (and by collateral assignment, the Indenture Trustee), a
continuing security interest of first priority, in all of the
Partnership's right, title and interest in, to and under (i) all
Receivables, (ii) all Inventory, (iii) all Equipment, (iv) all
General Intangibles, (v) all Contracts and all Contract Rights,
(vi) all amounts from time to time held in any checking, savings,
deposit or other account of the Partnership and all investments
and securities at any time on deposit in such accounts (including
all of the Accounts) and all income or gain earned thereon, (vii)
all Governmental Actions, provided, that any Governmental Action
which by its terms or by operation of law would become void,
voidable, terminable or revocable if mortgaged, pledged or
assigned hereunder or if a security interest therein were granted
hereunder are expressly excepted and excluded from the Lien and
the terms of this Agreement to the extent necessary so as to
avoid such voidness, voidability, terminability or revocability,
(viii) all Fixtures, (ix) without limiting the generality of the
foregoing, all other personal property, rights, interests, goods,
Instruments, Chattel Paper, Documents, credits, claims, demands
and assets of the Partnership whether now existing or hereafter
acquired from time to time, and (x) any and all additions and
accessions to any of the foregoing, all improvements thereto, all
substitutions and replacements therefor and all products and
Proceeds thereof (all of the above collectively, the
"Collateral").
(b) The security interest granted to the Security
Agent, for the benefit of GE Capital and the Owner Trustee,
pursuant to this Security Agreement extends to all Collateral of
the kind which is the subject of this Security Agreement which
the Partnership may acquire at any time during the continuation
of this Security Agreement, whether such Collateral is in transit
or in the Partnership's, the Security Agent's, the Owner
Trustee's, GE Capital's, or any other Person's constructive,
actual or exclusive occupancy or possession.
Section 2.2 Security Interest Absolute. All rights of
the Security Agent and all security interests hereunder, shall be
absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the
Facility Lease, any other Financing Document or any other agree
ment or instrument relating thereto;
(b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Lessee
Obligations, or any other amendment or waiver of or any consent
to any departure from the Facility Lease, the Reimbursement
Agreement or any other Financing Document;
(c) any exchange, release or non-perfection of
any other collateral, or any release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the
Lessee Obligations; or
(d) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the
Partnership or a third party pledgor.
Section 2.3 Power of Attorney. (a) The Partnership
hereby constitutes and appoints the Security Agent or any Person
or agent whom the Security Agent may designate, as the
Partnership's attorney-in-fact, at the Partnership's reasonable
cost and expense, to exercise at any time following the
occurrence and during the continuance of a Reimbursement Event of
Default or a Lease Event of Default all or any of the following
powers, in accordance with and subject to the terms and
conditions of the Project Documents, which, being coupled with an
interest, shall be irrevocable until all of the Lessee
Obligations have been paid in full:
(i) To receive, take, endorse, sign, as
sign and deliver, all in the Security Agent's name
or the Partnership's name, any and all checks,
notes, drafts, and other documents or instruments
relating to the Collateral;
(ii) To receive, open and dispose of all
mail addressed to the Partnership and to notify
postal authorities to change the address for de
livery thereof to such address as the Security
Agent designates;
(iii) To request from account debt
ors of the Partnership in the Partnership's name,
the Security Agent's name, or in the name of the
Security Agent's designee, information concerning
the Receivables and the amounts owing thereon;
(iv) To transmit to account debtors in
debted on Receivables notice of the Security
Agent's interest therein;
(v) To notify account debtors indebted
on Receivables to make payment directly to the
Security Agent;
(vi) To take or bring, in the
Partnership's name or the Security Agent's name,
all steps, actions, suits or proceedings deemed by
the Security Agent to be necessary or desirable to
enforce or effect collection of the Receivables;
(vii) To prepare, sign and file any
Uniform Commercial Code financing statements in
the name of the Partnership as debtor;
(viii) If the Partnership shall have
failed to do so in a timely manner, to take or
cause to be taken all actions necessary to perform
or comply or cause performance or compliance with
the covenants of the Partnership contained in the
Financing Documents;
(ix) To sign and endorse any invoices,
freight or express bills, bills of lading, storage
or warehouse receipts, drafts against debtors,
assignments, verifications, notices and other
documents in connection with any of the Collateral;
(x) To defend any suit, action or
proceeding brought against the Partnership with
respect to any Collateral;
(xi) To settle, compromise or adjust any
suit, action or proceeding described in the
preceding clause and, in connection therewith, to
give such discharges or releases as the Security
Agent may deem appropriate;
(xii) Generally, to sell or transfer
and make any agreement with respect to or
otherwise deal with any of the Collateral as fully
and completely as though the Security Agent were
the absolute owner thereof for all purposes, and
to do, at the Security Agent's option and the
Partnership's expense, at any time, or from time
to time, all acts and things which the Security
Agent deems necessary to protect, preserve or
realize upon the Collateral and the Liens of the
Security Agent thereon;
(xiii) To execute, in connection with
any foreclosure, any endorsements, assignments or
other instruments of conveyance or transfer with
respect to the Collateral; and
(xiv) To exercise the Partnership's
rights under any Contract in accordance with
Section 6.4.
(b) The Partnership hereby ratifies all that said
attorney shall lawfully do or cause to be done by virtue hereof.
The Partnership hereby acknowledges and agrees that the Security
Agent shall have no fiduciary duties to the Partnership and the
Partnership hereby waives any claims to the rights of a
beneficiary of a fiduciary relationship hereunder.
ARTICLE III
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
The Partnership represents, warrants and covenants,
which representations, warranties and covenants shall survive
execution and delivery of this Security Agreement, as follows:
Section 3.1 Validity of Lien. This Security Agreement
is effective to create, as security for the Lessee Obligations, a
legal, valid and enforceable Lien on and security interest in all
of the Collateral in favor of the Security Agent, for the benefit
of GE Capital and the Owner Trustee, superior to and prior to the
rights of all third Persons and subject to no other Liens (other
than Permitted Liens).
Section 3.2 No Liens. (a) The Partnership is, and as
to Collateral acquired by it from time to time after the date
hereof, the Partnership will be, the owner of all Collateral free
from all Liens or other right, title or interest of any Person
(other than Permitted Liens). The Partnership shall defend the
Collateral against all Liens and demands of all Persons at any
time claiming the same or any interest therein adverse to the
Security Agent, the Owner Trustee, GE Capital or the Indenture
Trustee.
(b) There are no financing statements (or similar
statement or instrument of registration under the law of any
jurisdiction) covering or purporting to cover any interest of any
kind in the Collateral, other than the financing statements filed
in favor of the Security Agent for the benefit of the Owner
Trustee (and by collateral assignment, the Indenture Trustee) and
GE Capital to secure the Lessee Obligations, and the Partnership
will not execute or authorize to be filed in any public office
any financing statement (or similar statement or instrument of
registration under the law of any jurisdiction) or statements
relating to the Collateral, except financing statements filed or
to be filed in respect of and covering the security interests
granted hereby to the Security Agent.
Section 3.3 Chief Executive Office; Name; Records.
The chief executive office of the Partnership is located at 0000
Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000; provided that
certain records concerning the Project and certain contracts
relating thereto are kept at the Partnership's office at the
Site. The Partnership will not (a) move its chief executive of
fice (or change the location(s) where records concerning the
Project are kept), or (b) change its name from, nor carry on busi
ness under any name other than "Panda-Brandywine, L.P.", unless
it has complied with the requirements of the last sentence of
this Section 3.3. The originals of all documents evidencing all
Contracts and Receivables of the Partnership, and the only
original books of accounts and records concerning the Collateral
are, and will continue to be, kept at, and controlled and
directed (including, without limitation, for general accounting
purposes) from, such chief executive office (or such other office
set forth above), or at such new location for such chief
executive office as the Partnership may establish in accordance
with the last sentence of this Section 3.3. The Partnership
shall not establish a new location for its chief executive office
or change its name or the name under which it presently conducts
its business until (i) it has given to the Security Agent, the
Administrative Agent and GE Capital not less than 30 days prior
written notice of its intention so to do, clearly describing such
new location or specifying such new name, as the case may be, and
providing such other information in connection therewith as the
Security Agent, the Administrative Agent or GE Capital may
reasonably request, and (ii) with respect to such new location or
such new name, as the case may be, it shall have taken all
action, reasonably satisfactory to the Security Agent, the
Administrative Agent and GE Capital, to maintain the security
interest of the Security Agent, on behalf of the Owner Trustee
and GE Capital, in the Collateral intended to be granted hereby
at all times fully perfected and in full force and effect.
Section 3.4 Financing Statements. The Partnership
agrees that it shall ensure that all necessary and appropriate
recordings and filings will be effected by the Security Agent in
all necessary and appropriate public offices (as determined by GE
Capital and the Administrative Agent) so that the Lien created by
the Lessee Security Documents will at all times constitute a
perfected Lien on and security interest in the Collateral prior
and superior to all other Liens (other than Permitted Liens), all
in accordance with the Uniform Commercial Code as enacted in any
and all relevant jurisdictions or any other relevant Law. The
Partnership authorizes the Security Agent to file any such
financing statements in connection with the Lien created by the
Lessee Security Documents without the signature of the Partne
rship.
Section 3.5 Further Actions. The Partnership will, at
its own expense, make, execute, endorse, acknowledge, file and/or
deliver to the Security Agent from time to time such lists,
descriptions and designations of its Collateral, bills of lading,
documents of title, vouchers, invoices, schedules, powers of
attorney, certificates, reports and other assurances or
instruments and take such further steps relating to the
Collateral and other property or rights covered by the security
interest hereby granted, which are necessary or desirable to
create, perfect, preserve, protect or validate any security
interest granted pursuant to this Security Agreement or to enable
the Security Agent to exercise and enforce its rights under this
Security Agreement with respect to such security interest.
Section 3.6 Taxes, Claims, etc. So long as this
Security Agreement is in effect, the Partnership shall pay (a)
all taxes, assessments and governmental charges imposed upon it
or upon its property, and (b) all claims (including, without
limitation, claims for labor, materials, supplies or services)
which might, if unpaid, become a Lien upon its property, unless,
in each case, the validity or amount thereof is subject to
Contest.
Section 3.7 Right of Inspection. The Partnership
shall allow any representative of the Security Agent, the
Administrative Agent or the Owner Participant to visit and
inspect any of the Partnership's properties, including, without
limitation, the Inventory and Equipment, to examine its books of
record and account, including, without limitation, the Inventory
Records, and to make extracts therefrom and to receive true
copies of any papers, documents or instruments relating to the
Collateral, and to discuss its affairs, finances and accounts
with its officers, all at such reasonable times during normal
business hours and at such reasonable intervals as the Security
Agent, the Administrative Agent or the Owner Participant may
request.
Section 3.8 Additional Statements and Schedules. The
Partnership shall execute and deliver to the Security Agent and
the Administrative Agent, from time to time, solely for their
convenience in maintaining a record of the Collateral, such
written statements and schedules as they may reasonably require
designating, identifying or describing the Collateral.
Section 3.9 Warehouse Receipts Non-Negotiable. The
Partnership agrees that if any warehouse receipt or receipt in
the nature of a warehouse receipt is issued with respect to any
of its Inventory, such warehouse receipt or receipt in the nature
thereof shall not be drawn in such a manner as to be "negotiable"
(as such term is used in Section 7-104 of the Uniform Commercial
Code as in effect in any relevant jurisdiction or under other
relevant law).
Section 3.10 Recourse; Limitation of Liability. There
shall be full recourse to the Partnership and all of its assets
for the liabilities of the Partnership under this Security
Agreement and the other Transaction Documents, but in no event
shall any Partner, Affiliate of any Partner, or any officer,
director or employee of the Partnership, any Partner or their
Affiliates or any holder of any equity interest in any Partner be
personally liable or obligated for such liabilities of the
Partnership except as may be specifically provided in any other
Transaction Document to which such Partner is a party or in the
event of fraudulent actions, knowing misrepresentations, gross
negligence or willful misconduct by the Partnership, any Partner
or any of their Affiliates in connection with the financing
contemplated under the Transaction Documents. Subject to the
foregoing limitation on liability, the Security Agent may xxx or
commence any suit, action or proceeding against any Partner or
any Affiliate thereof in order to obtain jurisdiction over the
Partnership in order to enforce its rights and remedies
hereunder. Nothing herein contained shall limit or be construed
to limit the liabilities and obligations of any Partner or any
Affiliate thereof in accordance with the terms of any other
Transaction Document creating such liabilities and obligations to
which such Partner or Affiliate is a party.
ARTICLE IV
SPECIAL PROVISIONS CONCERNING INVENTORY AND EQUIPMENT
Section 4.1 Location of Inventory and Equipment. The
Partnership agrees that all Inventory and Equipment now held or
subsequently acquired by it shall be kept at (or shall be in
transport to or shall be held in storage for transport to) the
Site, or such new location as the Partnership may establish in
accordance with the last sentence of this Section 4.1. The
Partnership may establish a new location for Inventory and
Equipment only if (i) it shall have given to the Security Agent,
the Administrative Agent and GE Capital 30 days prior written
notice of its intention so to do, clearly describing such new
location and providing such other information in connection there
with as the Security Agent, the Administrative Agent or GE
Capital may reasonably request, and (ii) with respect to such new
location, it shall have taken all action necessary to maintain
the security interest of the Security Agent in the Collateral in
tended to be granted hereby at all times fully perfected and in
full force and effect.
Section 4.2 Inventory Records. The Partnership shall
maintain such current Inventory Records as the Security Agent may
from time to time reasonably request.
ARTICLE V
SPECIAL PROVISIONS CONCERNING RECEIVABLES,
CONTRACTS AND INSTRUMENTS
Section 5.1 Additional Representations and
Warranties. As of the time when each of its Receivables arises,
the Partnership shall be deemed to have represented and warranted
that such Receivable and all records, papers and documents
relating thereto (if any) are genuine and in all respects what
they purport to be, and that all papers and documents (if any)
relating thereto (i) will (subject to dispute, return,
replacement, settlement or compromise) evidence indebtedness
unpaid and owed by such account debtor arising out of the
performance of labor or services or the sale and delivery of the
merchandise listed therein, or both, (ii) will be the only
original writings evidencing and embodying such obligation of the
account debtor named therein (other than copies created for
purposes other than general accounting purposes), (iii) will
(subject to dispute, return, replacement, settlement or
compromise and any limits due to applicable bankruptcy,
insolvency, moratorium or other similar rights affecting
creditors' rights generally and general principles of equity)
evidence true and valid obligations, enforceable in accordance
with their respective terms, not subject to the fulfillment of
any contract or condition whatsoever unless set forth in the
writing and (iv) will be in compliance and will conform with all
applicable requirements of Law.
Section 5.2 Maintenance of Records; Legending of
Records. The Partnership will keep and maintain at its own cost
and expense satisfactory and complete records of its Receivables,
including, but not limited to, records of all payments received
and all credits granted thereon, and the Partnership will make
the same available to the Security Agent and Administrative Agent
for inspection at the Partnership's chief executive office,
without charge to the Security Agent and Administrative Agent, at
such times as the Security Agent and Administrative Agent may
reasonably request. The Partnership shall, without charge to the
Security Agent and Administrative Agent, deliver all tangible
evidence that the Security Agent and Administrative Agent may
request of its Receivables (including, without limitation, all
documents evidencing the Receivables) and books and records to
the Security Agent or to its representatives (copies of which
evidence and books and records may be retained by the
Partnership) at any time upon the Security Agent's or
Administrative Agent's demand. If a Reimbursement Event of
Default or a Lease Event of Default occurs and continues, and if
the Security Agent so directs, the Partnership shall legend in
form and substance satisfactory to the Security Agent, the
Receivables and Contracts, as well as books, records and
documents evidencing or pertaining to the Receivables with an
appropriate reference to the fact that the Receivables and
Contracts have been assigned to the Security Agent, for the
benefit of GE Capital and the Owner Trustee, and that the
Security Agent has a security interest therein.
Section 5.3 Modification of Terms; No Payment to the
Partnership. The Partnership shall not rescind or cancel any
indebtedness evidenced by any Receivable or make any adjustment
with respect thereto, or extend or renew the same, or compromise
or settle any dispute, claim, suit or legal proceeding relating
thereto, or sell any Receivable or interest therein, without the
prior written consent of the Security Agent, the Administrative
Agent and GE Capital. The Partnership will duly fulfill all
obligations on its part to be fulfilled under or in connection
with the Receivables and will do nothing to impair the rights of
the Security Agent in the Receivables.
Section 5.4 Payments Under Project Documents and Receivables.
(a) Notice to Obligors under Project Documents
and Receivables. The Partnership agrees and confirms that it
will notify each party to the Project Documents and each account
debtor or obligor under the Receivables of the grant of the
security interest therein and assignment thereof to the Security
Agent and instruct each of them that all payments due or to
become due and all amounts payable to the Partnership hereunder
shall, until the Lessee Obligations are paid in full, be made
directly to the Security Agent as provided in the Security
Deposit Agreement. Unless notified to the contrary by the
Security Agent, and subject to Section 5.3 of this Security Agree
ment, the Partnership shall, at its expense, enforce collection
of any amounts payable with respect to each of the Receivables.
(b) Non-Payment to the Security Agent. In the
event the Partnership shall receive directly from any party to
the Project Documents or from any account debtor or other obligor
under any Receivable any payments under the Project Documents and
the Receivables otherwise than to the Security Agent, the Partner
ship shall receive such payments in a constructive trust for the
benefit of the Security Agent, shall segregate such payments from
other funds of the Partnership, and, shall forthwith transmit and
deliver such payments to the Security Agent in accordance with
the terms of the Security Deposit Agreement.
Section 5.5 Direction to Account Borrowers,
Contracting Parties; etc. (a) The Partnership agrees that the
Security Agent may, at its option, directly notify the account
debtors or obligors with respect to any Receivables and/or under
any Project Documents to make payments with respect thereto
directly to the Security Agent.
(b) The Partnership agrees to be bound by any
collection, compromise, forgiveness, extension or other action
taken by the Security Agent with respect to the Receivables
and/or Project Documents. Without notice to or assent by the
Partnership, the Security Agent may apply any or all amounts then
in, or thereafter deposited with any financial institution in any
checking, savings, deposit or other account of the Partnership in
accordance with the provisions of the Security Deposit Agreement.
The reasonable costs and expenses (including reasonable
attorneys' fees) of collection, whether incurred by the
Partnership or the Security Agent, shall be borne by the
Partnership.
Section 5.6 Instruments. At such time that a
Reimbursement Event of Default or a Lease Event of Default shall
have occurred and be continuing, the Partnership promptly shall
deliver all Instruments to the Security Agent, appropriately en
dorsed to the order of the Security Agent as further security
hereunder.
ARTICLE VI
SPECIAL PROVISIONS CONCERNING CONTRACTS
Section 6.1 Security Interest in Contract Rights. The
Partnership's assignment and grant, pursuant to Section 2.1, to
the Security Agent, for the benefit of GE Capital and the Owner
Trustee, of a security interest in all of its right, title and
interest in and to each and all of the Contracts and the contract
rights thereunder, includes, but is not limited to:
(a) all (i) rights to payment under any Contract and
(ii) payments due and to become due under any Contract, in
each case whether as contractual obligations, damages or
otherwise;
(b) all of its claims, rights, powers, or privileges
and remedies under any Contract; and
(c) all of its rights under any Contract to make deter
minations, to exercise any election (including, but not
limited to, election of remedies) or option or to give or
receive any notice, consent, waiver or approval together
with full power and authority with respect to any Contract
to demand, receive, enforce, collect or provide receipt for
any of the foregoing rights or any property the subject of
any of the Contracts, to enforce or execute any checks, or
other instruments or orders, to file any claims and to take
any action which, in the reasonable opinion of the Security
Agent, may be necessary or advisable in connection with any
of the foregoing (the Contracts, together with all of the
foregoing in this Section 6.1, the "Contract Rights");
provided, however, that until the occurrence and continuance of a
Reimbursement Event of Default or a Lease Event of Default,
notwithstanding anything else herein to the contrary, the
Partnership may, subject to the terms and provisions of the
Participation Agreement and the other Financing Documents, exclu
sively exercise all of the Partnership's rights, powers,
privileges and remedies under the Contracts.
Section 6.2 Further Protection. The Partnership
warrants and forever shall defend its title to the Contract
Rights against the claims and demands of any Person and hereby
grants the Security Agent full power and authority, upon the
occurrence or during the continuance of a Reimbursement Event of
Default or a Lease Event of Default to take all actions as the
Security Agent reasonably deems necessary or advisable to
effectuate the provisions set forth in this sentence.
Section 6.3 Partnership Remains Liable under
Receivables and Contracts. Anything herein to the contrary
notwithstanding (including, without limitation, the grant of any
rights to the Security Agent, the Owner Trustee or GE Capital or
any assignment of rights to the Indenture Trustee) the
Partnership shall remain liable under each of the Receivables and
Contracts to observe and perform all the conditions and
obligations to be observed and performed by it thereunder, all in
accordance with the terms of any agreement giving rise to each
such Receivable or Contract. None of the Security Agent, the
Owner Trustee, GE Capital, the Indenture Trustee, the
Administrative Agent or the Loan Participants shall have any
obligation or liability under any Receivable (or any agreement
giving rise thereto) or Contract by reason of or arising out of
this Agreement or the receipt by the Security Agent, the Owner
Trustee, GE Capital, the Indenture Trustee, the Administrative
Agent or any Loan Participant of any payment relating to such
Receivable or Contract pursuant hereto or pursuant to the
Security Deposit Agreement, nor shall the Security Agent, the
Owner Trustee, GE Capital, the Indenture Trustee, the
Administrative Agent or any Loan Participant be obligated in any
manner to perform any of the obligations of the Partnership under
or pursuant to any Receivable (or any agreement giving rise
thereto) or under or pursuant to any Contract, to make any pay
ment, to make any inquiry as to the nature or the sufficiency of
any payment received by it or as to the sufficiency of any
performance by any party under any Receivable (or any agreement
giving rise thereto) or under any Contract, to present or file
any claim, to take any action to enforce any performance or to
collect the payment of any amounts which may have been assigned
to it or to which it may be entitled at any time or times.
Section 6.4 Remedies. Upon the occurrence of any
Reimbursement Event of Default or Lease Event of Default and the
continuance thereof, the Security Agent shall have the rights set
forth in Article VII hereof, and in addition may (a) enforce all
remedies, rights, powers and privileges of the Partnership under
any or all of the Contracts, (b) sell any or all of the Contract
Rights at public or private sale upon at least 10 days' prior
written notice and/or (c) substitute itself or any nominee or
trustee in lieu of the Partnership as party to any of the
Contracts and to notify the obligor of any Contract Right (the
Partnership hereby agreeing to deliver any such notice at the
request of the Security Agent) that all payments and performance
under the relevant Contract shall be made or rendered to the
Security Agent or such other Person as the Security Agent may
designate.
ARTICLE VII
REMEDIES UPON OCCURRENCE OF REIMBURSEMENT
EVENT OF DEFAULT OR LEASE EVENT OF DEFAULT
Section 7.1 Remedies; Obtaining the Collateral upon
Default. Upon the occurrence of any Reimbursement Event of
Default or Lease Event of Default and the continuance thereof,
the Security Agent shall be entitled to exercise all the rights
and remedies of a secured party under the Uniform Commercial Code
as in effect in any relevant jurisdiction to enforce this
Security Agreement and the security interests contained herein,
and, in addition, subject to any mandatory requirements of Law
then in effect, the Security Agent may, in addition to its other
rights and remedies hereunder, including without limitation under
Sections 7.2 and 7.6, and also its (and GE Capital's and the
Owner Trustee's) rights under the other Financing Documents, do
any of the following:
(a) personally, or by trustees or attorneys,
immediately take possession of the Collateral or any part
thereof, from the Partnership or any other Person who then has
possession of any part thereof with or without notice or process
of law, and for that purpose may enter upon the Partnership's or
such other Person's premises where any of the Collateral is
located and remove the same and use in connection with such
removal any and all services, supplies, aids and other facilities
of the Partnership;
(b) instruct the obligor or obligors on any
agreement, instrument or other obligation (including, without
limitation, the Receivables and the Contracts) constituting the
Collateral to make any payment required by the terms of such
instrument or agreement directly to the Security Agent; and
(c) take possession of the Collateral or any part
thereof, by directing the Partnership in writing to turn over the
same to the Security Agent at the Site, in which event the
Partnership shall at its own expense
(i) forthwith turn over the same to the
Security Agent at the Site;
(ii) store and keep any Collateral so
turned over to the Security Agent at the Site pending
further action by the Security Agent as provided in Sec
tion 7.2, and
(iii) while the Collateral shall
be so stored and kept, provide such guards and
maintenance services as shall be necessary to
protect the same and to preserve and maintain them
in good condition.
The Partnership's obligation to turn over the Collateral as set
forth above is of the essence of this Security Agreement and,
accordingly, upon application to a court of equity having
jurisdiction, the Security Agent shall be entitled to obtain a
decree requiring specific performance by the Partnership of said
obligation.
Section 7.2 Remedies; Disposition of the Collateral.
Any Collateral repossessed by the Security Agent under or pursuant
to Section 7.1 and any other Collateral, whether or not so
repossessed by the Security Agent, may, to the extent permitted
by any contract terms governing such Collateral, be sold, leased
or otherwise disposed of under one or more contracts or as an
entirety, and without the necessity of gathering at the place of
sale the property to be sold, and in general in such manner, at
such time or times, at such place or places and on such terms
(whether cash or credit, and in the case of credit, without
assumption of future credit risk) as the Security Agent may, in
compliance with applicable requirements of Law, determine to be
commercially reasonable. Any of the Collateral may be sold,
leased or otherwise disposed of, in the condition in which the
same existed when taken by the Security Agent or after any
overhaul or repair which the Security Agent shall determine to be
commercially reasonable. Any such disposition shall be made upon
not less than 10 days' written notice to the Partnership specify
ing the time such disposition is to be made and, if such
disposition shall be a public sale, specifying the place of such
sale. Any such sale may be adjourned by announcement at the time
and place fixed therefor, and such sale may, without further
notice, be made at the time and place to which it was so
adjourned. To the extent permitted by applicable requirements of
Law, the Security Agent (or the Owner Trustee, GE Capital, the
Indenture Trustee, the Administrative Agent or any Loan
Participant) may bid for and become the buyer of the Collateral
or any item thereof offered for sale at a public auction without
accountability to the Partnership (except to the extent of
surplus money received as provided in Section 7.4).
Section 7.3 Waiver. (a) Except as otherwise
provided in this Security Agreement, THE PARTNERSHIP HEREBY
WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS,
NOTICE OR JUDICIAL HEARING IN CONNECTION WITH THE SECURITY
AGENT'S TAKING POSSESSION OR THE SECURITY AGENT'S DISPOSITION OF
ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL
PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES
AND ANY SUCH RIGHT WHICH THE PARTNERSHIP WOULD OTHERWISE HAVE
UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF
ANY STATE, and the Partnership hereby further waives:
(i) all damages occasioned by such
taking of possession except any damages which are
finally judicially determined to have been the
direct result of the Security Agent's gross
negligence or willful misconduct;
(ii) all other requirements as to
the time, place and terms of sale or other
requirements with respect to the enforcement of
the Security Agent's rights hereunder; and
(iii) all rights of redemption,
appraisement, valuation, stay, extension or
moratorium now or hereafter in force under any
applicable law in order to prevent or delay the en
forcement of this Security Agreement or the abso
lute sale of the Collateral or any portion
thereof, and the Partnership, for itself and all
who may claim under it, insofar as it or they may
now or hereafter lawfully do so, hereby waives the
benefit of such laws.
(b) Without limiting the generality of the
foregoing, the Partnership hereby: (i) authorizes the Security
Agent, in its sole discretion and without notice to or demand
upon the Partnership and without otherwise affecting the obliga
tions of the Partnership hereunder from time to time, to take and
hold other collateral granted to it by any other Person (in
addition to the Collateral) for payment of any Lessee
Obligations, or any part thereof, and to exchange, enforce or
release such other collateral or any part thereof, and to accept
and hold any endorsement or guarantee of payment of the Lessee
Obligations or any part thereof, and to release or substitute any
endorser or guarantor or any other person granting security for
or in any way obligated upon any Lessee Obligations, or any part
thereof; and (ii) waives and releases any and all right to
require the Security Agent to collect any of the Lessee
Obligations from any specific item or items of Collateral or from
any other party liable as guarantor or in any other manner in
respect of any of the Lessee Obligations or from any collateral
(other than the Collateral) for any of the Lessee Obligations.
(c) Any sale of, or the grant of options to
purchase, or any other realization upon, any Collateral shall,
provided that it is done in accordance with applicable law and
this Security Agreement, operate to divest all right, title,
interest, claim and demand, either at law or in equity, of the
Partnership therein and thereto, and shall be a perpetual bar
both at law and in equity against the Partnership and against any
and all Persons claiming or attempting to claim the Collateral so
sold, optioned or realized upon, or any part thereof, from,
through and under the Partnership.
Section 7.4 Application of Proceeds; Partnership
Liable for Deficiency. Except as otherwise specified therein,
the proceeds of any Collateral obtained pursuant to Section 5.4
or 7.1 or disposed of pursuant to Section 7.2 shall be applied,
first, to the payment of any expenses incurred by the Security
Agent in connection with the administration of this Security
Agreement, the custody, preservation or sale of, collection from
or other realization from, any of the Collateral, the exercise or
enforcement of any of its rights hereunder or the failure by the
Partnership to perform or observe any of the provisions hereof,
including all reasonable attorney's fees and second, to the
payment of the Lessee Obligations in accordance with the terms of
the Security Deposit Agreement. Any surplus remaining after
payment in full of all of the Lessee Obligations shall be paid
over to the Partnership or to whomever may be entitled to receive
such surplus. The Partnership shall be liable for any deficiency
remaining after any application of funds pursuant hereto.
Section 7.5 Remedies Cumulative; No Waiver. Each and
every right, power and remedy hereby specifically given to the
Security Agent shall be in addition to every other right, power
and remedy specifically given to the Security Agent (or the Owner
Trustee, GE Capital, the Administrative Agent, the Indenture
Trustee or any Holder) under this Security Agreement and the
other Financing Documents, or now or hereafter existing at law or
in equity, or by statute, and each and every right, power and
remedy whether specifically herein given or otherwise existing
may be exercised from time to time or simultaneously and as often
and in such order as may be deemed expedient by the Security
Agent. All such rights, powers and remedies shall be cumulative,
and the exercise or the partial exercise of one shall not be
deemed a waiver of the right to exercise of any other. No delay
or omission of the Security Agent in the exercise of any of its
rights, remedies, powers and privileges hereunder or partial or
single exercise thereof, and no renewal or extension of any of
the Lessee Obligations, shall impair any such right, remedy,
power or privilege or shall constitute a waiver thereof.
Section 7.6 Discontinuance of Proceedings. In case
the Security Agent shall have instituted any proceeding to en
force any right, power or remedy under this Security Agreement by
foreclosure, sale, entry or otherwise, and such proceeding shall
have been discontinued or abandoned for any reason or shall have
been determined adversely to the Security Agent, then, in every
such case, the Partnership and the Security Agent shall be
restored to their former positions and rights hereunder with
respect to the Collateral, subject to the security interest
created under this Security Agreement, and all rights, remedies
and powers of the Security Agent shall continue as if no such
proceeding had been instituted.
ARTICLE VIII
INDEMNITY
Section 8.1 Indemnity. (a) The Partnership agrees to
indemnify, reimburse and hold the Security Agent, GE Capital, the
Indenture Trustee, the Administrative Agent, the Loan
Participants and the Owner Trustee and their respective
successors, assigns, officers, directors, employees, and agents
(each individually, an "Indemnitee," and collectively,
"Indemnitees") harmless from any and all liabilities,
obligations, damages, injuries, penalties, claims, demands,
actions, suits, judgments and any and all costs and expenses
(including reasonable attorneys' fees and disbursements) (such
expenses, collectively, the "expenses") of whatsoever kind and
nature imposed on, asserted against or incurred by any of the
Indemnitees in any way relating to or arising out of (i) this
Security Agreement, any other Transaction Document, or the
documents executed in connection herewith and therewith or
connected with the administration of the transactions
contemplated hereby and thereby, or the enforcement of any of the
terms hereof or thereof, or the preservation of any rights
hereunder or thereunder, (ii) the ownership, purchase, delivery,
control, acceptance, lease, financing, possession, operation,
condition, sale, return or other disposition, or use of, the
Collateral (including, without limitation, latent or other
defects, whether or not discoverable, and any claim for patent or
trademark infringement), (iii) the violation of any requirements
of Law (including any Environmental Law) of any Governmental
Authority applicable to the Partnership or the Project, (iv) any
tort (including, without limitation, claims arising or imposed
under the doctrine of strict liability, or for or on account of
injury to or the death of any Person (including any Indemnitee),
or property damage), or (v) any contract claim, excluding (x)
those finally judicially determined to have arisen solely from
the gross negligence or willful misconduct of any Indemnitee or
(y) unless specifically provided for elsewhere in this agreement,
those arising out of the actions of any Indemnitee while in
possession or control of the Collateral.
(b) Without limiting the application of Section
8.1(a), the Partnership agrees to pay, or reimburse the Security
Agent, the Owner Trustee, the Indenture Trustee, the
Administrative Agent, any Loan Participant and GE Capital for any
and all reasonable fees, costs and expenses of whatever kind or
nature incurred in connection with the preservation, protection
or validation of the Security Agent's Liens on, and security
interest in, the Collateral, including, without limitation, all
fees and taxes in connection with the recording or filing of
instruments and documents in public offices, payment or discharge
of any taxes or Liens upon or in respect of the Collateral,
premiums for insurance with respect to the Collateral and all
other fees, costs and expenses in connection with protecting,
maintaining or preserving the Collateral and the Security Agent's
interest therein, whether through judicial proceedings or
otherwise, or in defending or prosecuting any actions, suits or
proceedings arising out of or relating to the Collateral.
(c) Without limiting the application of Section
8.1(a) or (b), the Partnership agrees to pay, indemnify and hold
each Indemnitee harmless from and against any losses, costs,
damages and expenses which such Indemnitee may suffer, expend or
incur in consequence of or growing out of any failure of the
Partnership to comply with its obligations under this Security
Agreement or any other Transaction Document, or any misrepresenta
tion by Partnership in this Security Agreement or any other
Transaction Document, or in any statement or writing contemplated
by or made or delivered pursuant to or in connection with this
Security Agreement or any other Transaction Document.
(d) If and to the extent that the obligations of
the Partnership under this Section 8.1 are unenforceable for any
reason, the Partnership hereby agrees to make the maximum con
tribution to the payment and satisfaction of such obligations
which is permissible under applicable requirements of Law.
Section 8.2 Lessee Obligations Secured by Collateral.
Any amounts paid by any Indemnitee as to which such Indemnitee
has the right to reimbursement, and any amounts paid by the
Security Agent in preservation of any of its rights or interest
in the Collateral, together with interest on such amounts from
the date paid until reimbursement in full at a rate per annum
equal at all times to the Overdue Rate, shall constitute Lessee
Obligations secured by the Collateral.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Notices. All notices and other
communications to any party hereunder shall be in writing
(including telecopy or similar teletransmission or writing) and
shall be given to such party at its address or telecopy number
set forth on Annex I hereto or such other address or telecopy
number as such party may hereafter specify by written notice to
the other party. Each such notice or other communication shall
be effective (i) if given by telecopy, when such telecopy is
transmitted by confirmed telecopier to the telecopy number
specified in this Section, (ii) if given by mail, 5 days after
such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (iii) if given by any
other means (including, without limitation, by air courier), when
delivered at the address specified in this Section.
Section 9.2 Amendment. None of the terms and
conditions of this Security Agreement may be amended, changed,
waived, modified or varied in any manner whatsoever except in
accordance with the provisions of subsection 13.1 of the
Participation Agreement and with the prior written consent of
each of the parties hereto and, unless the Lien of the Indenture
shall have been discharged, the Indenture Trustee.
Section 9.3 Successors and Assigns. This Security
Agreement shall be binding upon the Partnership and its
successors and assigns and shall inure to the benefit of the
Security Agent, GE Capital, the Owner Trustee and their
respective successors and assigns (including the Indenture
Trustee); provided, however, that the Partnership may not assign
or transfer its rights or obligations under this Security
Agreement without the prior written consent of the Owner Trustee
(and to the extent required by the Power Purchase Agreement, the
Power Purchaser), and so long as the Lien of the Indenture shall
not have been discharged, the Indenture Trustee.
Section 9.4 Survival. (a) All agreements,
statements, representations and warranties made by the
Partnership herein or in any certificate or other instrument
delivered by the Partnership or on its behalf under this Security
Agreement shall be considered to have been relied upon by the
Security Agent and shall survive the execution and delivery of
this Security Agreement and the other Transaction Documents
regardless of any investigation made by the Security Agent, or on
its behalf, until the Lessee Obligations shall have been paid in
full.
(b) The indemnity obligations of the Partnership
contained in Article VIII shall continue in full force and effect
notwithstanding the full payment of the Lessee Obligations and
notwithstanding the discharge thereof.
Section 9.5 Headings Descriptive. The headings of the
several sections of this Security Agreement are inserted for
convenience only and shall not in any way affect the meaning or
construction of any provision of this Security Agreement.
Section 9.6 Severability. Any provision of this
Security Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
Section 9.7 Partnership's Duties. Anything contained
herein to the contrary notwithstanding, the Partnership shall
remain liable to perform all of its obligations under or with
respect to the Collateral, and neither shall the Security Agent
have any obligations or liabilities under or with respect to any
Collateral by reason of or arising out of this Security
Agreement, nor shall the Security Agent be required or obligated
in any manner to perform or fulfill any of the obligations of the
Partnership under or with respect to any Collateral.
Section 9.8 Termination; Release. When all Lessee
Obligations have been indefeasibly paid in full (as determined by
the Owner Participant and the Indenture Trustee), this Security
Agreement shall terminate (except as provided in Section 9.4),
and the Security Agent, at the request and expense of the
Partnership, will promptly execute and deliver to the Partnership
the proper instruments (including Uniform Commercial Code
termination statements on form UCC-3) acknowledging the
termination of this Security Agreement, and will duly assign,
transfer and deliver to the Partnership (without recourse and
without any representation or warranty of any kind) such of the
Collateral as may be in the possession of the Security Agent and
has not theretofore been sold or otherwise applied or released
pursuant to this Security Agreement.
Section 9.9 Reinstatement. This Security Agreement
shall continue to be effective or be reinstated, as the case may
be, if at any time any amount received by the Security Agent, the
Owner Trustee or GE Capital in respect of the Lessee Obligations
is rescinded or must otherwise be restored or returned by the
Security Agent, the Owner Trustee, the Indenture Trustee, the
Administrative Agent, any Holder or GE Capital upon the
insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Partnership or upon the appointment of any
intervenor or conservator of, or trustee or similar official for,
the Partnership or any substantial part of its assets, or upon
the entry of an order by a bankruptcy court avoiding payment of
such amount, or otherwise, all as though such payments had not
been made.
Section 9.10 Counterparts. This Security Agreement may
be executed in any number of counterparts, each of which, when so
executed and delivered, shall be an original, but all of which
together shall constitute one and the same instrument.
Section 9.11 GOVERNING LAW; SUBMISSION TO JURISDICTION;
WAIVER OF JURY TRIAL.
(a) THIS SECURITY AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND
EXCEPT TO THE EXTENT THE VALIDITY OR PERFECTION OF THE SECURITY
INTERESTS HEREUNDER, OR REMEDIES HEREUNDER, ARE GOVERNED BY THE
LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT
TO THIS SECURITY AGREEMENT AND ANY ACTION FOR ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK AND, BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, THE PARTNERSHIP HEREBY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-
EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND APPELLATE
COURTS FROM ANY THEREOF. THE PARTNERSHIP IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN
ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE PARTNERSHIP
AT ITS ADDRESS REFERRED TO IN SECTION 9.1. THE PARTNERSHIP
HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID
ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT BROUGHT IN THE COURTS REFERRED TO ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN
ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED IN ANY OTHER JURISDICTION.
(c) EACH OF THE PARTNERSHIP AND THE SECURITY
AGENT HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN
CONNECTION WITH THIS SECURITY AGREEMENT OR ANY MATTER ARISING
HEREUNDER.
Section 9.12 Certain Rights of Power Purchaser.
Nothing in this Security Agreement shall be deemed to limit the
provisions of the Consent of the Power Purchaser, which
provisions are solely for the benefit of the Power Purchaser and
not the Partnership. Without limiting the scope of the
foregoing, the Security Agent agrees, for the exclusive benefit
of the Power Purchaser and not the Partnership, that the exercise
of remedies or any similar action under this Security Agreement
is subject to, and shall be conducted in a manner consistent
with, the Power Purchaser's rights under (i) the Consent of the
Power Purchaser and (ii) the Power Purchase Agreement and the
Transfer Agreement (to the extent such rights under the Power
Purchase Agreement and the Transfer Agreement are not explicitly
waived by the Power Purchaser in accordance with the terms of the
Consent of the Power Purchaser).
Section 9.14 Assignment to Indenture Trustee. In
order to secure the indebtedness evidenced by the Loan
Certificates certain other obligations as provided in the
Indenture, the Indenture provides, among other things, for the
assignment by the Owner Trustee to the Indenture Trustee of all
of its right, title and interest in, to and under this Agreement,
to the extent set forth in the Indenture, and for the creation of
a Lien on and security interest in the Lessor's Estate in favor
of the Indenture Trustee, and in furtherance thereof, the
Partnership and the Owner Trustee have entered into the Security
Deposit Agreement with the Security Agent. The Partnership
hereby acknowledges and consents to such assignment and such
security interest and hereby acknowledges that to the extent set
forth in the Indenture, the Indenture Trustee shall have the
right in its own name (in certain cases together with the Owner
Trustee and in other cases to the exclusion of the Owner Trustee,
all as set forth in Section 3.10 of the Indenture) to direct the
Security Agent to take or refrain from taking action under this
Agreement, including the right (i) of the Security Agent to
exercise any election or option, and to make any decision or
determination, and to give any notice, consent, waiver or
approval under this Agreement or in respect thereof, (ii) to
exercise any and all of the rights, powers and remedies of the
Security Agent hereunder and (iii) to receive all moneys payable
to the Security Agent. The Partnership will make all payments
hereunder in accordance with the provisions of Security Deposit
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Security Agreement to be executed and delivered by their duly
authorized officers as of the date first above written.
PANDA-BRANDYWINE, L.P.
By: Panda Brandywine Corporation,
its sole general partner
By: /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President
FLEET NATIONAL BANK, as Security Agent
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
