Exhibit 10.53
TRINIDAD GUARANTEE
This TRINIDAD GUARANTEE (this "Guarantee") is entered into as of
August 4, 1998 by YORK HOLDINGS (BARBADOS) SRL, a society with restricted
liability organized in Barbados (the "Guarantor"), in favor of THE BANK OF
NEW YORK, a New York banking corporation, under that certain Indenture described
in the recitals below, and as Collateral Agent under the Intercreditor Agreement
for the benefit of the Secured Parties (in such capacities, the "Collateral
Agent"). All capitalized terms used herein but not specifically defined shall
have the respective meanings given to such terms in Appendix A to the
Indenture, which Appendix A is hereby incorporated herein by reference as if
set forth in full herein.
W I T N E S S E T H:
WHEREAS, York Power Funding (Cayman) Limited (the "Funding Company") is a
limited liability company organized under the laws of the Cayman Islands for
the sole purpose of issuing the Securities pursuant to the Indenture and
making loans to the Project Borrowers from the proceeds of such issuance;
WHEREAS, the Funding Company has on the date hereof issued and sold
Securities in the principal amount of $150 million;
WHEREAS, the principal and interest payments on the Securities will be
partially serviced by repayment of a loan made by the Funding Company to the
Trinidad Project Borrower and guaranteed by the Trinidad Guarantor subject to
the conditions set forth in the Indenture;
WHEREAS, the Funding Company will loan $100 million of the proceeds of
issuance of the Securities to the Trinidad Project Borrower, which will be
contributed by the Trinidad Project Borrower to the Trinidad Guarantor and
will be loaned by the Trinidad Guarantor to the Trinidad Obligor pursuant to
the Trinidad Loan Agreement; and
WHEREAS, the Guarantor is a subsidiary of the Trinidad Project Borrower
and anticipates benefiting directly and indirectly from the Trinidad Project
Loan and, therefore, is willing to guarantee certain of the obligations of
the Trinidad Project Borrower thereunder in accordance with the terms hereof.
NOW, THEREFORE, in consideration of the above premises and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. (a) As set forth in this Guarantee, the Guarantor guarantees the
full payment of the Guaranteed Obligations (as hereafter defined) when due,
upon maturity, acceleration or otherwise; PROVIDED, HOWEVER, that no demand
under this Guarantee may be made, and no obligation to pay all or any portion
of the Guaranteed Obligations shall exist, unless at the time such demand
shall have been made there also shall have occurred and be continuing an
Event of Default under Section 5.1(a) of the Trinidad Project Loan Agreement
between the Trinidad Project Borrower and the Funding Company.
(b) The Guarantor hereby and unconditionally agrees that upon
any failure by the Trinidad Project Borrower to pay, when due, of any of the
Guaranteed Obligations, the Guarantor will promptly pay the same. Each and
every failure in the payment of any of the Guaranteed Obligations shall give
rise to a separate cause of action under this Guarantee, and separate suits
may be brought against the Guarantor hereunder as each cause of action arises.
(c) The Guarantor further agrees that this Guarantee
constitutes an absolute, present and continuing guarantee of payment and not
of collection and shall apply to all Guaranteed Obligations whenever arising
and waives any right to require that any resort be had by the Funding Company
after the failure (after giving effect to any applicable grace period) by the
Trinidad Project Borrower in making such payment to the Funding Company
rights against any other Person, or any other right or remedy available to
the Funding Company by contract, Applicable Law or otherwise.
2. Guaranteed Obligations as used herein shall mean all principal,
interest, fees, charges, penalties, expenses, payments and all other amounts
due on or with respect to the Trinidad Project Note or otherwise pursuant to
the Trinidad Project Loan Agreement (the "Guaranteed Obligations").
3. The liability of the Guarantor under this Guarantee in respect of
the Guaranteed Obligations shall be absolute and unconditional and shall not
be affected or released in any way, irrespective of:
(a) any lack of validity or enforceability of the Trinidad
Project Loan Agreement, the Trinidad Project Note or any of the other
Transaction Documents;
(b) any change in the time, manner or place of payment of, or
in any other term of any of the Guaranteed Obligations or amendment or waiver
of, or any consent to any departure from, any Transaction Document,
including, without limitation, any increase in the Guaranteed Obligations or
other obligations of the Trinidad Project Borrower under the Trinidad Project
Loan Agreement.
(c) any enforcement of any Transaction Document, including the
taking, holding or sale of any collateral, or any termination or release of
any collateral from the liens created by any Transaction Document or the
non-perfection of any liens created by any Transaction Document;
(d) any change, restructuring or termination of the structure
or existence of the Funding Company or the Trinidad Project Borrower;
(e) any Event of Default of the Funding Company under
Section 5.1 of the Indenture; or
(f) any Event of Default of the Trinidad Project Borrower under
Section 5.1 of the Trinidad Project Loan Agreement.
This Guarantee shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Guaranteed Obligations
is rescinded or must otherwise be returned by the Collateral Agent or any
other Person upon the insolvency, bankruptcy or reorganization of, the
Trinidad Project Borrower or the Guarantor, or otherwise, all as though such
payment had not been made.
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4. The obligations hereunder are independent of the obligations of
the Trinidad Project Borrower, and a separate action or actions may be
brought and prosecuted against the Guarantor whether action is brought
against either the Trinidad Project Borrower, or whether the Trinidad Project
Borrower be joined in any such action or actions, and to the extent permitted
by Applicable Law, the Guarantor waives the benefit of any statute of
limitations affecting its liability hereunder.
5. The Guarantor authorizes the Funding Company or the Bond Trustee,
as applicable, acting pursuant to the Trinidad Project Loan Agreement,
without notice or demand and without affecting its liability hereunder, from
time to time, whether before or after termination of this Guarantee, to (a)
renew, compromise, extend, accelerate or otherwise change the time for
payment of the obligations of the Trinidad Project Borrower under the
Trinidad Project Loan Agreement or any part thereof, (b) take and hold
security for the payment of this Guarantee or the Guaranteed Obligations, and
exchange, enforce, waive, release, fail to perfect, sell, or otherwise
dispose of any such security, (c) apply such security and direct the order or
manner of sale thereof and (d) release or substitute any one or more of the
endorsers or guarantors.
6. The Guarantor makes the following representations and warranties
to the Collateral Agent, which representations and warranties shall survive
the execution and delivery of this Guarantee:
(a) ORGANIZATION, POWER AND STATUS OF THE GUARANTOR. The
Guarantor (i) is a society with restricted liability duly organized and
validly existing under the laws of Barbados and (ii) has all requisite power
and authority to own the property and assets owned by it and to lease the
properties leased by it and to carry on its business as now being conducted
and as proposed to be conducted.
(b) AUTHORIZATION; ENFORCEABILITY; EXECUTION AND DELIVERY.
(i) The Guarantor has all necessary power and authority to
execute, deliver and perform its obligations under this Guarantee and any
other Transaction Document to which the Guarantor is a party.
(ii) The Guarantor has taken all necessary and proper
action to authorize the execution, delivery and performance by it of this
Guarantee and any other Transaction Document to which the Guarantor is a
party. The execution, delivery and performance of this Guarantee and any
other Transaction Document to which the Guarantor is a party does not require
the approval or consent of any holder or trustee of any Indebtedness or other
obligations of the Guarantor which has not been obtained.
(iii) This Guarantee and any other Transaction Document to
which the Guarantor is a party have been duly executed and delivered by the
Guarantor and constitute legal, valid and binding obligations of the
Guarantor, enforceable against the Guarantor in accordance with the terms
hereof and thereof, except as the enforceability hereof or thereof may be
limited by (A) applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting the enforcement of creditors' rights
generally and (B) general equitable principles, regardless of whether the
issue of enforceability is considered in a proceeding in equity or at law.
(c) NO CONFLICT. Neither the execution, delivery and
performance of this Guarantee or any other Transaction Document to which the
Guarantor is a party nor the consummation of any of the transactions
contemplated hereby or thereby (i) contravenes or violates any
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provision of any Applicable Law to which the Guarantor or any of its assets is
subject, (ii) conflicts with or violates any provision of any formation document
of the Guarantor or (iii) conflicts with or violates, will result in a breach of
any of the terms, covenants, conditions or provisions of, constitutes a default
under, or results in the acceleration of Indebtedness evidenced by, any
agreement or instrument to which the Guarantor is a party or by which it or any
of its properties or assets is bound or to which it may be subject, except, in
the case of clause (i) or (iii) immediately above, any such conflict, violation,
breach, default or acceleration which could not reasonably be expected to result
in a Material Adverse Effect, or (iv) results in the creation or imposition of
(or the obligation to create or impose) any Lien (other than Trinidad Permitted
Project Liens) upon any of the properties or assets of the Guarantor.
(d) COMPLIANCE WITH APPLICABLE LAW. The Guarantor has been and
is currently in compliance with all Applicable Laws to which it or any of its
assets is subject, except where failure to comply could not reasonably be
expected to result in a Material Adverse Effect.
(e) LITIGATION. There are no claims, actions, suits,
investigations or proceedings at law or in equity (including any
Environmental Claims) or by or before any arbitrator or Governmental
Authority now pending against the Guarantor or, to the best knowledge of the
Guarantor, threatened against the Guarantor or any properties, assets or
rights of the Guarantor that could reasonably be expected to result in a
Material Adverse Effect.
(f) ENVIRONMENTAL MATTERS. The Guarantor has been and is
currently in compliance with all applicable Environmental Laws except where
the failure to comply could not reasonably be expected to have a Material
Adverse Effect. To the best knowledge of the Guarantor, the Trinidad Project
is in compliance with all applicable Environmental Laws and there are no
existing facts, circumstances or conditions which could under any existing
applicable Environmental Law, individually or in the aggregate with all other
circumstances and conditions, reasonably be expected to result in a Material
Adverse Effect.
(g) BUSINESS OF THE GUARANTOR. Except as otherwise permitted
in this Guarantee and the other Finance Documents, the Guarantor is not
engaged in any business other than the financing of the Trinidad Project and
transactions related thereto.
(h) VALID TITLE. The Guarantor is the legal and beneficial
owner of, with good, legal and valid title to, all its properties and assets
free and clear of all other Liens than Trinidad Permitted Project Liens.
(i) SECURITY INTERESTS.
(i) The Security Documents to which the Guarantor is a
party, upon execution and delivery by the parties thereto, create valid, and,
when financing statements (or the equivalent) in appropriate form are filed
in the recording offices specified therein, perfected, first priority Liens
subject to Trinidad Permitted Project Liens in all of the Trinidad Collateral
owned by the Guarantor in favor of the Collateral Agent for the benefit of
the Secured Parties.
(ii) No mortgage or financing statement or other
instrument or recordation executed or authorized to be filed by the
Guarantor, or, to the Guarantor's best knowledge, by any other Person
covering all or any part of the property or assets of the Guarantor
(including the Trinidad Collateral) is on file in any recording office,
except such as relate to Trinidad Permitted Project Liens.
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(j) UTILITY REGULATION. The Guarantor is not subject to
regulation by the United States Securities and Exchange Commission under
PUHCA as a "holding company," a "public utility company" or an "affiliate" or
a "subsidiary company" of a "holding company."
(k) NO DEFAULTS.
(i) No Trinidad Default or Trinidad Event of Default has
occurred and is continuing.
(ii) The Guarantor is not in default under any Trinidad
Project Document or any other Transaction Document to which the Guarantor is
a party except for defaults which could not reasonably be expected to result
in a Material Adverse Effect.
(iii) To the best knowledge of the Guarantor, no default
exists by any other party to any Trinidad Project Document or any other
contract related to the Trinidad Project and no event of force majeure exists
under any Trinidad Project Document except for defaults which, in either
case, could not reasonably be expected to result in a Material Adverse Effect.
(l) GOVERNMENTAL APPROVALS. All Governmental Approvals which
are required to be obtained by, in the name of or on behalf of the Guarantor
or, to the knowledge of the Guarantor, any other party to any Transaction
Document in connection with the execution, delivery and performance by the
Guarantor or any other party to any Transaction Document of the Transaction
Documents have been duly obtained and are in full force and effect, other
than, in each case, those Governmental Approvals which the failure to so
obtain could not reasonably be expected to result in a Material Adverse
Effect.
(m) MARGIN STOCK. The Guarantor is not engaged, directly or
indirectly, principally, or as one of its important activities, in the
business of extending, or arranging for the extension of, credit for the
purposes of purchasing or carrying any "margin stock" (as defined in
Regulation, T, U or X of the Board of Governors of the Federal Reserve
System).
(n) TAXES. The Guarantor has filed or caused to be filed all
Tax Returns required by Applicable Law to be filed by it, and has paid all
Taxes shown to be due and payable by it on such Tax Returns or any
assessments made against it or any of its properties and all other Taxes,
fees or other charges imposed on it by any Governmental Authority other than
Taxes, fees, assessments or other charges which are not delinquent and remain
payable without penalty or which the Guarantor is contesting in good faith
and for which the Guarantor is maintaining adequate reserves (in accordance
with GAAP) in connection therewith.
(o) OWNERSHIP OF THE GUARANTOR. As of the date of this
Guarantee, the Trinidad Project Borrower and Xxxxxx Xxxxxxxx are the sole
members of the Guarantor.
(p) DISCLOSURE. Each of the Preliminary Offering Circular and
the Final Offering Circular as of its date did not, and the Final Offering
Circular (as the same may have been amended or supplemented) as of the
Closing Date will not, contain any untrue statement of a material fact with
respect to the Guarantor or omit to state a material fact necessary to make
the statements made therein with respect to the Guarantor, in light of the
circumstances under which they were made, not misleading.
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(q) REPRESENTATIONS AND WARRANTIES. All representations and
warranties made by the Guarantor and each of its Affiliates, and to its
knowledge, each other party in any Transaction Document are true and correct,
except to the extent such misrepresentation could not reasonably be expected
to have a Material Adverse Effect.
(r) TRINIDAD PROJECT DOCUMENTS. The Collateral Agent has
received a complete copy of each Trinidad Project Document then in effect
(including all exhibits, schedules and disclosure letters referred to therein
or delivered pursuant thereto, if any).
(s) TRINIDAD PROJECT. To the best of the Guarantor's
knowledge, the services to be performed, the materials to be supplied and the
easements, licenses and other rights granted or to be granted to the Trinidad
Obligor pursuant to the terms of the Trinidad Project Documents provide or
will provide the Trinidad Obligor with all rights and property interest
required to enable the Trinidad Obligor to obtain all services, materials or
rights (including access) required for the design, construction, start-up,
operation and maintenance of the Trinidad Project, including the Trinidad
Obligor's full and prompt performance of its obligations, and full and timely
satisfaction of all conditions precedent to the performance by others of
their obligations, under the Trinidad Project Documents, other than those
services, materials or rights that reasonably can be expected to be
obtainable in the ordinary course of business.
7. The Guarantor hereby covenants and agrees that from the date of this
Guarantee, it shall faithfully observe and fulfill, and shall cause to be
faithfully observed and fulfilled, each and all of the following covenants until
all amounts due under this Guarantee, the Trinidad Project Note and the Trinidad
Project Loan Agreement shall have been indefeasibly paid in full:
(a) REPORTING REQUIREMENTS. The Guarantor shall furnish or
cause to be furnished to the Funding Company and, in the case of item (ix)
set forth below, each of the Rating Agencies:
(i) as soon as available and in any event within sixty
(60) days after the end of the first three (3) quarterly accounting periods
in each fiscal year of the Guarantor (commencing with the quarter ending
August 31, 1998), and, with respect to item (C) herein, the final quarter of
each fiscal year, Unaudited Financial Statements of the Guarantor,
accompanied by an Officer's Certificate of the Guarantor confirming (A) that
such Unaudited Financial Statements fairly present of the financial condition
and results of operations of the Guarantor on the dates and for the periods
indicated in accordance with GAAP (other than with respect to the notes and
other normally recurring year-end adjustments), (B) that no Trinidad Default
has occurred and no Trinidad Event of Default has occurred and is continuing,
or, if such event has occurred, describing the nature thereof and (C) the
Debt Service Coverage Ratios for the historical three (3) quarters and the
final quarter of such fiscal year, together with a reconciliation of each
quarterly Debt Service Coverage Ratio to the annual Debt Service Coverage
Ratio;
(ii) as soon as available and in any event within one
hundred twenty (120) days after the end of each fiscal year of the Trinidad
Finance Parties (commencing with the fiscal year ending February 28, 1999),
Annual Audited Consolidated Financial Statements, accompanied by an audit
opinion thereon by the Auditors, which opinion shall state that (A) said
financial statements of the Trinidad Finance Parties present fairly, in all
material respects, the financial position, results of operations and cash
flows of the Trinidad Finance Parties at the end of, and for, such fiscal
year in accordance with GAAP, (B) nothing has come to their attention that
any Trinidad Default has occurred and no Trinidad Event of Default, as they
relate to
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accounting matters, has occurred and is continuing, or, if such event has
occurred, describing the nature thereof and (C) the Debt Service Coverage
Ratios for such fiscal year;
(iii) promptly and in any event within five (5) days after
an Authorized Officer of the Guarantor obtains actual knowledge of any
Trinidad Default or Trinidad Event of Default, a written notice describing
such Trinidad Default or Trinidad Event of Default and any action being or
proposed to be taken with respect thereto;
(iv) all other information reasonably requested by Funding
Company to enable Funding Company to satisfy its obligations under the
Indenture;
(v) written notice of any event or condition that could
reasonably be expected to result in a Material Adverse Effect;
(vi) notice of any litigation, pending or threatened,
against the Guarantor of which it has actual knowledge, which could
reasonably be expected to result in a Material Adverse Effect;
(vii) all reports related to environmental matters in
respect of the Trinidad Project;
(viii) copies of all material notices delivered to it in
connection with any Trinidad Project Document or otherwise in connection with
the Trinidad Project;
(ix) copies of all construction schedules, construction
budgets and Operating Budgets which are approved by the Independent Engineer
(together, periodically, with evidence of compliance therewith), copies of
all bi-monthly reports issued by the Independent Engineer prior to Completion
of the Trinidad Project and each annual report thereafter and monthly
operating reports from the Trinidad Obligor;
(x) copies of all change orders and any document or
written notice from the construction contractor requesting or recommending
the initiation of a change order and any other notice, including, without
limitation, notices with respect to the occurrence of a force majeure event
(or event of similar effect) under any Trinidad Project Document which may
result in a material increase in Trinidad Project Costs;
(xi) promptly upon request, a list of the current balances
of each of the Trinidad Depositary Accounts; and
(xii) any notice it receives from the Trinidad Obligor
pursuant to the Trinidad Loan Agreement.
(b) MAINTENANCE OF EXISTENCE. The Guarantor shall at all times
preserve and maintain in full force and effect (i) its existence as a society
with restricted liability and (ii) all of its powers, rights, privileges and
licenses necessary for the transaction of its business as conducted or
proposed to be conducted except, in the case of this clause (b) where failure
to do so could not reasonably be expected to result in a Material Adverse
Effect.
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(c) COMPLIANCE WITH LAWS. The Guarantor shall comply with all
Applicable Laws (including Environmental Laws), except where non-compliance
could not reasonably be expected to result in a Material Adverse Effect.
(d) GOVERNMENTAL APPROVALS; TITLE.
(i) The Guarantor shall cause the Trinidad Obligor to
obtain in a timely manner, maintain in full force and effect (or where
appropriate, renew) and comply with all Governmental Approvals (including,
without limitation, those required under Environmental Laws) required at any
time or advisable (A) in connection with the construction, maintenance,
ownership and good and orderly operation of the Trinidad Project, as
currently conducted and as proposed to be conducted, (B) for the Trinidad
Project to produce, sell and deliver electricity in accordance with and as
contemplated by the Trinidad Project Documents and (C) to execute and deliver
the Transaction Documents to which it is a party and to perform its
obligations thereunder, unless in each case the failure to so obtain,
maintain or comply with such Governmental Approvals could not reasonably be
expected to result in a Material Adverse Effect.
(ii) The Guarantor shall preserve and maintain good, valid
and, where applicable, marketable title to all of its properties and assets
subject to no Liens other than Trinidad Permitted Project Liens except where
the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
(e) EXERCISE OF RIGHTS AND PERFORMANCE UNDER TRANSACTION
DOCUMENTS.
(i) The Guarantor shall exercise all of its rights under
any Transaction Document to which it is party unless failure to do so could
not reasonably be expected to result in a Material Adverse Effect.
(ii) The Guarantor shall take all reasonable action within
its control required to ensure that each Transaction Document to which it is
a party is in proper legal form under the respective governing laws selected
for such Transaction Document for the enforcement thereof in such
jurisdictions without further action on the part of Funding Company or the
Collateral Agent.
(iii) The Guarantor shall perform all of its covenants and
obligations under each Transaction Document to which it is party and shall
take all necessary action to prevent the termination or cancellation of any
Transaction Document to which it is a party except where such nonperformance
or nonobservance, or the result of such termination or cancellation, could
not reasonably be expected to result in a Material Adverse Effect.
(f) ADDITIONAL DOCUMENTS; FILINGS AND RECORDINGS.
(i) The Guarantor shall execute and deliver, from time to
time as reasonably requested by Funding Company or the Collateral Agent, at
the Guarantor's expense, such documents in connection with the rights and
remedies of the Secured Parties granted or provided for by this Guarantee or
the other Transaction Documents to which the Guarantor is a party and to
consummate the transactions contemplated therein.
(ii) The Guarantor shall, at its own expense, take all
reasonable actions necessary to establish, maintain, protect, perfect and
continue the perfection and priority
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of the Liens created by the Trinidad Security Documents and to protect and
enforce its rights and title and the rights and title of the Secured Parties
to the Trinidad Collateral in such manner and in such places as in the
opinion of counsel to the Guarantor or the Collateral Agent is required by
Applicable Law in order to fully preserve and protect the rights of Funding
Company or the Collateral Agent, except where the failure to do so could not
reasonably be expected to have as Material Adverse Effect.
(g) PAYMENT OF TAXES AND CLAIMS. The Guarantor shall, prior to
the time penalties shall attach thereto, pay and discharge or cause to be
discharged all Taxes, assessments and governmental charges or levies imposed
upon it, its income or its properties; PROVIDED that the Guarantor shall not
be required to pay any such obligation if (i) such charges are being
diligently contested in good faith by appropriate proceedings, (ii) during
the period of such contest the enforcement of any contested item is
effectively stayed and (iii) adequate reserves are established with respect
to the contested items (in accordance with GAAP).
(h) BOOKS AND RECORDS. The Guarantor shall keep proper books
of record and account truly and fairly reflecting the financial condition and
results of operations of the Guarantor in which full, true and correct
entries in conformity with GAAP and all Applicable Laws shall be made of all
dealings and transactions in relation to its business and activities. Upon
five (5) days written notice, the Guarantor shall permit officers and
designated representatives of Funding Company, the Collateral Agent, the
Depositary Bank and any duly authorized agent or representative thereof
(including without limitation, the Independent Engineer) to visit and
inspect, from time to time during normal business hours, any of the
properties of the Guarantor and to examine and make copies of the books of
record and account of the Guarantor and discuss the affairs, finances and
accounts of the Guarantor with, and be advised as to the same by, its
officers, all at such reasonable times and intervals and to such reasonable
extent as Funding Company, the Collateral Agent, the Depositary Bank and duly
authorized agent or representative thereof (including, without limitation,
the Independent Engineer) may reasonably request.
(i) AUDITORS. The Guarantor shall retain a nationally
recognized independent accounting firm in the United States to act as its
auditors and authorize such firm to communicate directly with Funding Company
and the Collateral Agent. The Guarantor shall also appoint an auditor who is
a member of, and holds a practicing certificate from, the Institute of
Chartered Accountants of Barbados.
(j) TRINIDAD REVENUE ACCOUNT. The Guarantor shall take all
actions as may be necessary to cause all revenues of the Guarantor to be
deposited in the Trinidad Revenue Account in accordance with the Trinidad
Depositary Agreement and to be disbursed in accordance with the provisions
set forth in ARTICLE 3 (The Trinidad Depositary Accounts) of the Trinidad
Depositary Agreement.
(k) PROJECT IMPLEMENTATION. The Guarantor shall, to the extent
such action is within its control, operate the Trinidad Project and all other
property and rights in accordance with good operating procedure and maintain
the Trinidad Project and other property in good repair and condition
(ordinary wear and tear excepted in respect thereof).
(l) PERMITTED INDEBTEDNESS. The Guarantor shall not create or
incur or suffer to exist any Indebtedness except the following:
(i) Indebtedness incurred pursuant to this Guarantee;
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(ii) Indebtedness incurred to finance in whole or in part
the making of capital improvements to the Trinidad Project required to
maintain compliance with Applicable Law; PROVIDED that the Independent
Engineer shall have certified to the Bond Trustee that:
(A) an Officer's Certificate of an Authorized Officer
of the Trinidad Obligor certifying that such Indebtedness is required to make
a capital improvement to the Trinidad Project that is required in order to
maintain compliance with Applicable Law is reasonable and that such
Indebtedness is the most effective means of making such capital expenditure
and, if applicable, completing the Trinidad Project; and
(B) after giving effect to the incurrence of such
Indebtedness, the minimum Projected Debt Service Coverage Ratio for (1) the
next four consecutive fiscal quarters, commencing with the quarter in which
such Indebtedness is to be incurred, taken as one annual period and (2) each
subsequent fiscal year through the Final Maturity Date for the Securities,
will not be less than 1.2 to 1;
(iii) Indebtedness incurred to finance in whole or in part
the making of capital improvements to the Trinidad Project other than those
capital improvements referenced in clause (ii) above PROVIDED that:
(A) an Authorized Officer of the Trinidad Obligor
certifies to the Bond Trustee that no Trinidad Default or Trinidad Event of
Default has occurred and is continuing or will occur as a result of the
incurrence of such Indebtedness;
(B) the Independent Engineer shall have certified to
the Bond Trustee that after giving effect to the incurrence of such
Indebtedness, (1) the minimum Projected Debt Service Coverage Ratio for (x)
the next four consecutive fiscal quarters commencing with the quarter in
which such Indebtedness is to be incurred, taken as one annual period and (y)
each subsequent fiscal year through the Final Maturity Date for the
Securities, will not be less than 1.5 to 1 and (2) the average Projected Debt
Service Coverage Ratio for all succeeding fiscal years until the Final
Maturity Date for the Securities will not be less than 1.55 to 1; and
(C) written confirmation from each Rating Agency then
rating the Securities that the incurrence of such Indebtedness will not
result in a Ratings Downgrade;
(iv) Indebtedness in the form of a working capital
facility for the benefit of the Trinidad Project in an aggregate principal
amount not to exceed $3,000,000; PROVIDED that the terms of such facility
provide that the aggregate amount of all loans outstanding thereunder shall
be reduced to zero for ten (10) days in each fiscal year;
(v) To the extent such obligations would constitute
Indebtedness, obligations of the Trinidad Finance Parties under the Trinidad
Project Documents;
(vi) Indebtedness related to Trinidad Permitted Project
Liens; and
(vii) Subordinated Indebtedness from any other Trinidad
Finance Party.
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(m) PERMITTED LIENS. The Guarantor shall not create or suffer
to exist or permit any Lien upon or with respect to any of its properties
except the following:
(i) Liens specifically permitted or required by, or
created by, any Security Document or any Transaction Document including,
without limitation, the Trinidad PPA;
(ii) Liens for taxes, assessments or governmental charges
which are either not yet due or which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves are
established in accordance with GAAP; and
(iii) Other Liens incidental to the conduct of the
Guarantor's business or the ownership of properties and assets which were not
incurred in connection with the borrowing of money or the obtaining of
advances or credit (other than Liens arising by operation of law or statute
in the ordinary course of business), and which do not in the aggregate
materially impair the use thereof in the operation of the Guarantor's
business.
(n) CONTINGENT LIABILITIES. The Guarantor shall not
contingently or otherwise be or become liable, directly or indirectly, in
connection with any Guaranteed Obligation except for endorsements and similar
obligations in the ordinary course of business.
(o) NATURE OF BUSINESS. The Guarantor shall not engage in any
business other than its existing business and as otherwise contemplated by
the Transaction Documents.
(p) PROHIBITION ON FUNDAMENTAL CHANGES. The Guarantor shall
not enter into any transaction of merger or consolidation, change its form of
organization or its business, liquidate, wind-up or dissolve itself (or
suffer any liquidation or dissolution), discontinue its business or purchase
or otherwise acquire all or substantially all of the assets of any other
Person, except, in any such case, as contemplated by the Finance Documents.
(q) SALE OF ASSETS. The Guarantor shall not sell or transfer
any assets or assign any rights other than (so long as no Trinidad Default or
Trinidad Event of Default has occurred and is continuing) those in the
ordinary course of its business for cash equal to the fair market value of
such assets at the time of sale, except, in any such case, as contemplated by
the Finance Documents.
(r) SUBSIDIARIES; ADVANCES, INVESTMENTS AND LOANS. The
Guarantor shall not form or have any Subsidiaries (other than the Trinidad
Obligor), make investments, loans or advances or acquire the stock,
obligations or securities of any Person; PROVIDED that the Guarantor may
invest amounts on deposit in the Trinidad Depositary Accounts, subject to
limitations as to term and duration, in Cash Equivalents; PROVIDED FURTHER
that the Guarantor may make loans to the other Trinidad Finance Parties
provided that such loans shall be Subordinated Indebtedness of such other
Trinidad Finance Party; PROVIDED FURTHER that the Guarantor shall be entitled
to receive equity contributions from, and make equity contributions to, the
Trinidad U.S. Parent, the Trinidad Cayman Parent, or any other Trinidad
Finance Party.
(s) TRANSACTIONS WITH AFFILIATES. The Guarantor shall not
enter into any transaction or series of related transactions, whether or not
in the ordinary course of business, with any Affiliate of the Guarantor which
is not on terms and conditions no less favorable as would be obtained in a
comparable arm's-length transaction with a Person other than an Affiliate of
the Guarantor, except that the Guarantor may perform its obligations under
and engage in the transactions contemplated by the Transaction Documents.
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(t) RESTRICTED PAYMENTS. The Guarantor shall not make any
Restricted Payments except as permitted under the Finance Documents.
(u) AMENDMENTS TO TRINIDAD PROJECT DOCUMENTS. Other than with
respect to Permitted Contract Buy-Outs, the Guarantor (nor any Affiliate
thereof) shall not, directly or indirectly, (x) permit the assignment of the
rights and obligations of any party to any Trinidad Project Document or (y)
terminate, amend, modify, replace, supplement or waive, or permit or consent
to the termination, modification, replacement, supplement or waiver of, any
of the provisions of, or give any consent under, any of the Trinidad Project
Documents unless (i) the Guarantor certifies that such assignment,
termination, amendment, modification, replacement, supplement, waiver or
consent could not reasonably be expected to result in a Material Adverse
Effect, in addition to the condition set forth in clause (i) above and (ii)
in the case of any assignment, termination, amendment, modification,
replacement, supplement, waiver or consent with respect to the Trinidad PPA
or any other Trinidad Project Document which affects the revenues to be
received by the Guarantor, (x) the Independent Engineer certifies that such
assignment, termination, amendment, modification, replacement, supplement,
waiver or consent could not reasonably be expected to result in a Material
Adverse Effect and (y) the Guarantor provides to the Bond Trustee written
confirmation from each Rating Agency then rating the Securities that such
assignment, termination, amendment, modification, replacement, supplement,
waiver or consent will not result in a Ratings Downgrade.
(v) ASSIGNMENT OF OBLIGATIONS; ADDITIONAL AGREEMENTS. The
Guarantor shall not assign any of its rights or obligations under any
Transaction Document and shall not enter into any additional contract,
agreement or undertaking if the transactions contemplated by such assignment
or additional contract, agreement or undertaking could reasonably be expected
to have a Material Adverse Effect; PROVIDED that the Guarantor shall be
permitted to assign any of its rights or obligations hereunder if such
assignment is necessary to avoid any adverse tax consequences resulting from
a change in Applicable Law (or the interpretation thereof) and (i) no
Trinidad Default or Trinidad Event of Default shall exist and be continuing
at such time, (ii) the Bond Trustee shall receive written confirmation from
each Rating Agency that such assignment shall not result in a Ratings
Downgrade and (iii) the Bond Trustee receives satisfactory Opinions of
Counsel of the Guarantor stating that (A) such assignment is enforceable and
creates a legal, valid and binding obligation of the Guarantor, (B) such
assignment has no adverse consequences upon the rights and remedies of the
Secured Parties with respect to the Collateral and (C) such assignment shall
have no adverse effects on the tax structure of the transaction prior to the
assignment or upon payments to or from any Project Obligor or otherwise
related to the Securities and each of the Project Notes.
(w) MODIFICATIONS OF FORMATION DOCUMENTS. The Guarantor shall
not amend or modify its articles of organization, certificate of
organization, by-laws or other formation documents or change its fiscal year,
except if such amendment, modification or change which could not reasonably
be expected to result in a Material Adverse Effect.
(x) ABANDONMENT. The Guarantor shall not voluntarily cease or
abandon the development, construction or operation of the Trinidad Project.
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(y) TAXATION.
(i) All payments made by the Guarantor in respect of the
Trinidad Project Loan shall be made free and clear of, and without
withholding or deduction for or on account of, any and all Taxes. The
Guarantor shall pay such additional amounts as may be necessary to ensure
that the amounts received by the Funding Company after such withholding or
deduction, if any, shall equal the respective amounts of principal and
interest that would have been receivable in the absence of such withholding
or deduction.
(ii) The Guarantor shall promptly pay when due any present
or future stamp, court or documentary Taxes or any other excise or property
Taxes, charges or similar levies that arise in any jurisdiction from the
execution or delivery of the Trinidad Project Note or any other document
referred to herein or therein, excluding (A) Taxes imposed on or measured by
the net income or capital of the Funding Company and (B) any such Taxes,
charges or similar levies imposed by any jurisdiction other than Barbados or
Trinidad.
(z) REMEDIES UPON A TRINIDAD EVENT OF DEFAULT. The Guarantor
shall not exercise its rights pursuant to SECTION 5.2 (Remedies Upon a
Trinidad Event of Default) of the Trinidad Loan Agreement unless:
(i) in the case of an exercise of its rights pursuant to
SECTION 5.2(I), the Guarantor has received the written and unrescinded
direction of (A) the One-Third Holders or (B) the Bond Trustee,
notwithstanding the absence of direction from the One-Third Holders, if in
the good faith exercise of its discretion the Bond Trustee determines that
such action is necessary to protect the interests of the Holders, to do so;
and
(ii) in the case of an exercise of its rights pursuant to
SECTION 5.2(II), the Guarantor has received the written and unrescinded
direction of (A) the Majority Holders or (B) the Bond Trustee,
notwithstanding the absence of direction from the Majority Holders if in the
good faith exercise of its discretion the Bond Trustee determines that such
action is necessary to protect the interests of the Holders to do so.
8. The Guarantor hereby waives, to the extent permitted by
Applicable Law: (a) promptness, diligence, notice of acceptance and any other
notice with respect to any of the indebtedness or any other obligations under
the Transaction Documents or this Guarantee, (b) any requirement that the
Collateral Agent or any other person protect, secure or insure any lien or
any collateral or other property subject thereto or exhaust any right or take
any action against either the Trinidad Project Borrower or any other Person
or any collateral, (c) any defense arising by reason of any claim or defense
based upon an election of remedies by the Funding Company or the Bond Trustee
which in any manner impairs, reduces, releases or otherwise adversely affects
its subrogation, contribution or reimbursement rights or other rights to
proceed against either the Trinidad Project Borrower or any other Person or
any collateral, (d) any duty on the part of the Funding Company or the Bond
Trustee to disclose to the Guarantor any matter, fact or thing relating to
the business, operation or condition of either the Trinidad Project Borrower
or any other party to any of the Transaction Documents and the Trinidad
Project Borrower's assets now known or hereafter known by the Funding Company
or the Bond Trustee and (e) all presentments, demands for performance,
notices of non-performance, protests, notices of protest, notices of
dishonor, and notices of acceptance of this Guarantee and of the existence,
creation, or incurrence of new or additional Guaranteed Obligations.
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9. The Guarantor hereby irrevocably waives, to the extent permitted
by Applicable Law, any claim or other rights which it may now or hereafter
acquire against the Trinidad Project Borrower, whether due or to become due,
voluntary or involuntary, absolute or contingent, liquidated or unliquidated,
determined or undetermined, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution, indemnification, any
right to participate in any claim or remedy of the Funding Company against
the Trinidad Project Borrower or any collateral which the Funding Company now
has or hereafter acquires, whether or not such claim, remedy or right arises
in equity, or under contract, statute or common law, including without
limitation, the right to take or receive from the Trinidad Project Borrower,
directly or indirectly, in cash or other property or by setoff or in any
other manner, payment or security on account of such claim or other rights.
If any amount shall be paid to the Guarantor in violation of the preceding
sentence and the Guaranteed Obligations shall not have been paid in full,
such amount shall be deemed to have been paid by the Guarantor for the
benefit of, and held in trust for the benefit of, the Collateral Agent and
shall forthwith be paid to the Funding Company to be credited and applied to
the Guaranteed Obligations, whether matured or unmatured, in accordance with
the terms of the Trinidad Project Loan Agreement. The Guarantor acknowledges
that it will receive direct and indirect benefits from the incurrence of the
Trinidad Project Loan contemplated by the Trinidad Project Loan Agreement and
that the waiver set forth in this Section 9 is knowingly made in
contemplation of such benefits.
10. The Guarantor agrees that, to the extent that either the
Trinidad Project Borrower or the Guarantor makes a payment or payments to the
Funding Company, or the Collateral Agent receives any proceeds of Collateral,
which payment or payments or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential set aside or otherwise required to
be repaid to either the Trinidad Project Borrower, its estate, trustee,
receiver or any other party, including, without limitation, under any
bankruptcy law, state or federal law, common law or equitable cause, then to
the extent of such payment or repayment, the obligation or part thereof which
has been paid, reduced or satisfied by such amount shall be reinstated and
continued in full force and effect as of the date such initial payment,
reduction or satisfaction occurred. The Guarantor shall defend or indemnify
the Funding Company from and against any claim or loss under this Section 8
(including reasonable attorneys' fees and expenses) in the defense of any
such action or suit.
11. The Guarantor acknowledges and agrees that it shall have the
sole responsibility for obtaining from the Trinidad Project Borrower such
information concerning the Trinidad Project Borrower's financial conditions
or business operations as the Guarantor may require, and that the Collateral
Agent has no duty at any time to disclose to the Guarantor any information
relating to the business operations or financial condition of the Trinidad
Project Borrower.
12. To the extent that the waiver set forth in SECTION 7 is or is
deemed to be ineffective or inapplicable, any obligations of the Trinidad
Project Borrower to the Guarantor, now or hereafter existing, are hereby
subordinated to the Guaranteed Obligations. If the Collateral Agent so
requests, after the occurrence of an Event of Default under the Trinidad
Project Loan Agreement, such obligations of the Trinidad Project Borrower to
the Guarantor shall be enforced and performance received by the Guarantor as
trustee for the Collateral Agent and the proceeds thereof shall be paid over
to the Collateral Agent on account of the Guaranteed Obligations, but without
reducing or affecting in any manner the maximum liability of the Guarantor
under the other provisions of this Guarantee.
13. The Collateral Agent may, without notice to the Guarantor and
without affecting the Guarantor's obligations hereunder, assign this
Guarantee, in whole or in part in accordance with the provisions of the
Trinidad Project Loan Agreement and the Intercreditor Agreement. The
Guarantor agrees that the Collateral Agent may, subject to the provisions of
the Trinidad Project Loan Agreement, disclose to any prospective purchaser
and any purchaser of all or part of the Guaranteed Obligations any
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and all information in the Collateral Agent's possession concerning the
Guarantor, this Guarantee and any security for this Guarantee.
14. The Guarantor agrees to pay all reasonable attorneys' expenses
and fees and all other fees and expenses which may be incurred by the
Collateral Agent in the enforcement of this Guarantee.
15. The Collateral Agent agrees that no partners, directors,
officers, shareholders or employees or agents of the Guarantor shall in any
way be liable for the payment of the Trinidad Project Note or any sums now or
hereafter owing under the terms of, or for the performance of any obligation
contained in, this Guarantee.
16. No modification or waiver of any of the provisions of this
Guarantee shall be binding on the Collateral Agent, except as expressly set
forth in a writing duly signed and delivered by the Collateral Agent acting
pursuant to the terms of the Intercreditor Agreement.
17. This Guarantee shall be binding upon and inure to the benefit of
the Guarantor and the Collateral Agent for the benefit of the Secured Parties
and their respective successors and assigns; PROVIDED that the Guarantor
shall not assign its rights or the Guaranteed Obligations created under this
Guarantee without the prior written consent of the Collateral Agent.
18. In case any provision of this Guarantee, the Trinidad Project
Loan Agreement or the Trinidad Project Note shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability
of the remaining provisions or the Guaranteed Obligations, or of such
provision or the Guaranteed Obligations in any jurisdiction, shall not in any
way be affected or impaired thereby.
19. This Guarantee shall be governed by and construed according to
the laws of the State of New York.
20. This Guarantee embodies the entire agreement and understanding
between the parties hereto and supersedes all prior agreements and
understandings relating to the subject matter hereof.
21. WITH REGARD TO THIS GUARANTEE, EACH OF THE GUARANTOR AND THE
COLLATERAL AGENT HEREBY WAIVES THE RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING AND FOR ANY COUNTERCLAIM THEREIN.
22. All notices, demands, requests and other communications required
or permitted hereunder shall be in writing, and shall be given and deemed to
have been given in accordance with Section 6.1 of the Trinidad Project Loan
Agreement and the information set forth immediately below shall apply to:
If to the Guarantor:
York Holdings (Barbados) SRL
The Ernst & Young Building
Xxxx Xxxx, Bay Street
St. Xxxxxxx, Barbados
Attention:
----------------------
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If to the Bond Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration--
International Finance Unit
23. This Guarantee may be executed in any number of counterparts,
all of which together shall constitute one agreement.
24. The obligations of the Guarantor hereunder are subject to the
limitations set forth in Section 6.10 of the Trinidad Project Loan Agreement,
the provisions of which are hereby incorporated by reference.
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IN WITNESS WHEREOF, the parties hereto have caused this Guarantee to be
duly executed as of the day and year first written above.
YORK HOLDINGS (BARBADOS) SRL,
a society with restricted liability
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
THE BANK OF NEW YORK,
as Collateral Agent
By: /s/ Xxxxxx Xxxxx
---------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
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