Exhibit 10.c
ESCROW AGREEMENT
This Escrow Agreement (as the same may be amended or modified from time to
time in accordance with the terms hereof, and including any and all written
instructions given to the Escrow Agent (hereinafter defined) pursuant hereto,
this "ESCROW AGREEMENT") is made and entered into as of _______ ___, 2004, by
and among Enron Corp., an Oregon corporation ("SELLER"), CCE Holdings, LLC, a
Delaware limited liability company ("PURCHASER"), the Pension Benefit Guaranty
Corporation (the "PBGC") and [________ (the "BANK")].1
WITNESSETH:
WHEREAS, Seller and Purchaser have requested the Bank to act in the
capacity of escrow agent under this Escrow Agreement, and the Bank, subject to
the terms and conditions hereof, has agreed so to do;
WHEREAS, pursuant to that certain Purchase Agreement, dated June 24,
2004, as amended as of September 1 , 2004 (the "PURCHASE AGREEMENT"), by and
among Seller, certain of its affiliates and Purchaser, Purchaser has agreed to
purchase, and Seller and certain of its affiliates have agreed to sell, 100% of
the membership interests of CrossCountry Energy, LLC, a Delaware limited
liability company, on the terms and conditions set forth in the Purchase
Agreement;
WHEREAS, unless otherwise defined herein, capitalized terms used herein
shall have the meanings assigned to them in the Purchase Agreement;
WHEREAS, pursuant to Section 9.11 of the Purchase Agreement, Seller has
agreed to indemnify and hold the Purchaser Indemnified Parties harmless from and
against all Losses that are imposed upon or assessed against a Transfer Group
Company or the assets thereof arising out of certain claims under Title IV of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"); and
WHEREAS, Seller has agreed to establish an escrow fund by depositing
$321,800,000 in immediately available funds (the "ESCROW AMOUNT") with the
Escrow Agent (hereinafter defined) contemporaneously with the Closing in lieu of
the obligations in respect of claims of the PBGC under Sections 42.2 and 21.3 of
the Fifth Amended Joint Plan of Affiliated Debtors Pursuant to Chapter 11 of the
United States Bankruptcy Code;
NOW THEREFORE, in consideration of the premises and mutual covenants
and agreements contained herein, the parties hereto hereby agree as follows:
1. APPOINTMENT OF ESCROW AGENT. Each of the Seller, Purchaser and PBGC
hereby appoints the Bank as the escrow agent under this Escrow Agreement (the
Bank in such capacity, the "ESCROW AGENT"), and the Escrow Agent hereby accepts
such appointment. Each of the parties hereto acknowledges and agrees that the
Escrow Agent has not reviewed, is not a party to and shall have no liability
under the Purchase Agreement.
2. ESCROWED PROPERTY. Contemporaneously with the Closing, Seller shall
deliver the Escrow Amount in immediately available funds to the Escrow Agent.
Once deposited with the Escrow Agent, the Escrow Amount is referred to herein as
the "ESCROWED PROPERTY." The Escrowed Property shall be held by the Escrow Agent
in one or more segregated escrow accounts (collectively, the "ESCROW ACCOUNT")
for the benefit of Purchaser, Seller and the PBGC, as provided in this Escrow
Agreement. In no event shall the Escrow Agent disburse or invest the Escrowed
Property except in accordance with this Escrow Agreement.
3. INVESTMENT OF THE ESCROWED PROPERTY. (a) Pending disbursement of the
Escrowed Property in accordance with the terms of this Escrow Agreement, the
Escrow Agent shall invest and reinvest the Escrowed Property in Permitted
Investments (as defined below). The Escrow Agent may use a broker-dealer of its
own selection, including a broker-dealer owned by or affiliated with the Escrow
Agent or any of its affiliates. The Escrow Agent or any of its affiliates may
receive reasonable and customary compensation with respect to any investment
directed hereunder (provided that such compensation shall be disclosed in
writing to Seller and Purchaser prior to such investment). The Escrow Agent
shall have the right to liquidate any investment held in order to release the
Escrowed Property as provided by this Escrow Agreement. It is expressly agreed
and understood by the parties hereto that the Escrow Agent shall not in any way
whatsoever be liable for losses on any investments, including, but not limited
to, losses from market risks due to premature liquidation or resulting from
other actions taken pursuant to and consistent with this Escrow Agreement. For
purposes of this Escrow Agreement, "PERMITTED INVESTMENTS" shall mean direct
obligations of the U.S. government, obligations guaranteed by the U.S.
government and money market funds that invest solely in direct obligations of
the U.S. government or in obligations guaranteed by the U.S. government, in each
case having maturities of ninety (90) days or less.
(b) Receipt, investment and reinvestment of the Escrowed Property
shall be confirmed by the Escrow Agent as soon as practicable following
each such transaction by account statement to Seller, Purchaser and PBGC,
and any discrepancies in any such account statement shall be noted by
Seller and Purchaser to the Escrow Agent within thirty (30) calendar days
after receipt thereof. Failure to inform the Escrow Agent in writing of any
discrepancies (except for gross or manifest errors) in any such account
statement within said 30-day period shall presumptively be deemed
confirmation of such account statement in its entirety. For purposes of
this paragraph, each account statement shall be deemed to have been
received by the party to whom directed on the earlier to occur of (i)
actual receipt thereof and (ii) five (5) Business Days after the deposit
thereof in the United States Mail, postage prepaid.
4. DISBURSEMENT OF THE ESCROWED PROPERTY. The Escrow Agent is hereby
authorized to release all or any portion of the Escrowed Property only as
follows:
(a) To the PBGC, with respect to claims of the PBGC related to the
pension plans listed in Section 4(c) hereof (the "SELLER PLANS"), promptly,
but in no event later than two (2) Business Days, after the Escrow Agent's
receipt of written instructions directing such payment executed by Seller,
with a copy thereof to Purchaser and the PBGC;
(b) To the Purchaser, promptly, but in no event later than two (2)
Business Days, after the Escrow Agent's receipt of (i) written instructions
executed by Seller, with copies thereof to Purchaser and the PBGC, stating
that liabilities or claims under Title IV of ERISA have been imposed upon
or assessed against a Transfer Group Company (as defined in the Purchase
Agreement) or the assets thereof, or (ii) copy of a final judgment of a
court of competent jurisdiction that is not appealable as a matter of right
(a "FINAL DETERMINATION"), with copies thereof to Seller and the PBGC,
which establishes that liabilities or claims under Title IV of ERISA have
been imposed upon or assessed against a Transfer Group Company or the
assets thereof, and, in each case, paid by a Transfer Group Company to the
PBGC, and by reason thereof the Purchaser is entitled to indemnification
pursuant to Section 9.11 of the Purchase Agreement, in respect of such
amounts paid to the PBGC;
(c) Promptly, but in no event later than twenty-four (24) hours, after
the Escrow Agent's receipt of written instructions executed by Seller, with
a copy thereof to Purchaser, and the PBGC (with the PBGC notice being
delivered, in writing, at least two (2) Business Days in advance of any
distribution) directing the Escrow Agent to release all or a portion of the
Escrowed Property (i) to one or more of the trusts maintained by Seller
and/or its affiliates in connection with the Enron Corp. Cash Balance Plan
(EIN: ), the Garden State Paper Pension Plan (EIN: ), the EFS Pension Plan
(EIN: ) or the San ▇▇▇▇ Gas Pension Plan (EIN: ) (collectively, the
"PENSION Trusts"), which written instruction will provide that such
disbursement shall be made directly by Escrow Agent to one or more of the
Pension Trusts by wire transfer; or (ii) to Seller, in respect of a payment
made by Seller after the date hereof to a Pension Trust, which written
instruction will be accompanied by (x) a certification of an executive
officer of Seller that an equivalent amount has been deposited by Seller,
following the date hereof, into one or more of the Pension Trusts, (y) a
written confirmation of the receipt of such funds by the trustee of such
Pension Trust(s); provided, however, that in no event will Seller be
entitled to a disbursement on account of any minimum funding contribution
it makes to the Pension Trusts or will any disbursement be used to satisfy
any minimum funding contributions to the Pension Trusts; and further
provided the case of (i) or (ii) above, transferred amounts shall not be
used to purchase annuities by any of the Pension Trusts, or to reimburse
Seller therefor, without the express prior written consent of the PBGC (and
the passage of time alone does not constitute such consent) and transferred
amounts shall not be in an amount which would cause any Seller Plan to be
funded in excess of its benefit liability obligations under the Seller
Plan;
(d) To the PBGC, promptly, but in no event later than two (2) Business
Days, after receipt by the Escrow Agent, Seller and Purchaser of a copy of
a Final Order (as defined in the Purchase Agreement) by the Bankruptcy
Court which establishes that PBGC has allowed claims for unfunded benefit
liabilities under Title IV of ERISA with respect to the Seller Plans, in
the amount set forth in such Final Order;
(e) The Escrow Agent shall promptly deliver after receipt by the
Escrow Agent of express prior written instructions from Seller and the PBGC
(which instructions the PBGC will reasonably give), with a copy thereof to
Purchaser, (i) all then remaining Escrowed Property to Seller (A) in the
case of involuntary termination of the Seller Plans by the PBGC upon
complete satisfaction of the unfunded benefits liabilities as determined
under ERISA as set forth in a Final Determination, or (B) in the case of
standard termination of all of the Seller Plans, upon the earlier of (1)
the first anniversary of the filing by the Seller with the PBGC of the
Post-Distribution Certification (PBGC Form 501) in connection with the last
termination of a Seller Plan, if the post-termination audit of such plan by
the PBGC has not been completed or (2) the completion of the
post-termination audits of all of the Seller Plans and settlement of all
disputed items arising from such audits (the "Audit Claims"), but in no
event earlier than the date upon which there is no liability with respect
to a defined benefit pension plan subject to Title IV of ERISA for which
Purchaser could be entitled to indemnification pursuant to Section 9.11 of
the Purchase Agreement, or (ii) prior thereto, in the event there are
outstanding Audit Claims, prior to the disbursement by (i) above, the
amount by which the Escrowed Property exceeds the amount of such Audit
Claims; or
(f) Otherwise in accordance with the joint instructions of Seller,
Purchaser and the PBGC.
5. AMOUNTS DISTRIBUTED OR EARNED. All amounts earned with respect to the
Escrowed Property (whether interest or otherwise) shall become part of the
Escrowed Property and shall be held under the same terms as the Escrowed
Property initially delivered to the Escrow Agent hereunder.
6. TAX MATTERS. Purchaser and Seller agree that Seller shall include any
amounts earned with respect to the Escrowed Property in their respective gross
incomes for federal, state and local income tax purposes and that Seller shall
be liable for payment (and shall indemnify Purchaser for Losses incurred by
Purchaser from Seller's nonpayment) of all taxes payable with respect to such
earnings and all related tax reporting duties. Each of Purchaser and Seller
shall provide the Escrow Agent with its taxpayer identification number and the
other information set forth on the signatures page hereto. Failure so to provide
such information may prevent or delay disbursements from the Escrowed Property
and may also result in the assessment of a penalty and the Escrow Agent's being
required to withhold tax on any interest or other income earned on the Escrowed
Property. Any payments of income shall be subject to applicable withholding
regulations then in force in the United States or any other jurisdiction, as
applicable.
7. SCOPE OF UNDERTAKING. The Escrow Agent's duties and responsibilities in
connection with this Escrow Agreement shall be purely ministerial and shall be
limited to those expressly set forth in this Escrow Agreement. The Escrow Agent
is not a principal, participant or beneficiary in any transaction underlying
this Escrow Agreement and shall have no duty to inquire beyond the terms and
provisions hereof. Except as set forth in SECTION 16, the Escrow Agent shall
have no responsibility or obligation of any kind in connection with this Escrow
Agreement or the Escrowed Property and shall not be required to deliver the
Escrowed Property or any part thereof or take any action with respect to any
matters that might arise in connection therewith, other than to receive, hold,
invest, reinvest and deliver the Escrowed Property as herein provided. Without
limiting the generality of the foregoing, it is hereby expressly agreed and
stipulated by the parties hereto that the Escrow Agent shall not be required to
exercise any discretion hereunder and shall have no investment or management
responsibility and, accordingly, shall have no duty to, or liability for its
failure to, provide investment recommendations or investment advice to Seller or
Purchaser. The Escrow Agent shall not be liable for any error in judgment, any
act or omission, any mistake of law or fact, or for anything it may do or
refrain from doing in connection herewith, except for, subject to SECTION 8
hereof, its own fraud, willful misconduct, gross negligence or material breach
of this Escrow Agreement. It is expressly agreed and acknowledged that the
Escrowed Property remains property of the Seller following the deposit of such
funds with the Bank in accordance with the terms hereof and does not constitute
the assets of any of the Pension Trusts or the defined benefit plans related
thereto and that no action taken by the Bank in accordance with the terms hereof
shall be construed or interpreted to render the Bank a fiduciary with respect to
the Pension Trusts for any purpose. It is the intention of the parties hereto
that the Escrow Agent shall never be required to use, advance or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties or the exercise of any of its rights and powers hereunder.
8. RELIANCE; LIABILITY. The Escrow Agent may rely on, and shall not be
liable for acting or refraining from acting in accordance with, any written
notice, instruction or request or other paper furnished to it in hereunder or
pursuant hereto and reasonably believed by it in good faith to have been signed
or presented by the proper party or parties. The Escrow Agent shall be
responsible for holding, investing, reinvesting and disbursing the Escrowed
Property pursuant to this Escrow Agreement; provided, however, that in no event
shall the Escrow Agent be liable for any lost profits, lost savings or other
exemplary, consequential or incidental damages in excess of the Escrow Agent's
fee hereunder (not resulting from its own fraud, gross negligence or willful
misconduct), and provided, further, that the Escrow Agent shall have no
liability for any loss arising from any cause beyond its control, including, but
not limited to, the following: (a) acts of God, force majeure, including,
without limitation, war (whether or not declared or existing), revolution,
insurrection, riot, civil commotion, accident, fire, explosion, stoppage of
labor, strikes and other differences with employees; (b) the act, failure or
neglect of Seller or Purchaser, (c) the act, failure or neglect of any agent or
correspondent or any other person selected by the Escrow Agent (unless such
selection involved fraud, gross negligence or willful misconduct); (d) any
delay, error, omission or default of any mail, courier, telegraph, cable or
wireless agency or operator; or (e) the acts or edicts of any government or
governmental agency or other group or entity exercising governmental powers. The
Escrow Agent is not responsible or liable in any manner whatsoever for the
transaction or transactions requiring or underlying the execution of this Escrow
Agreement or for the identity or authority of any person (other than the Escrow
Agent) executing this Escrow Agreement or any part hereof or holding the
Escrowed Property.
9. RIGHT OF INTERPLEADER. Should any controversy arise involving the
parties hereto or any of them or any other person, firm or entity with respect
to this Escrow Agreement or the Escrowed Property, or should a substitute escrow
agent fail to be designated as provided in SECTION 16 hereof, or if the Escrow
Agent should have reasonable doubt as to what action to take with respect to the
continuation of the Escrow Account or any disbursements hereunder, the Escrow
Agent shall have the right, but not the obligation, either to (a) withhold
delivery of the Escrowed Property until the controversy is resolved, the
conflicting demands are withdrawn or its reasonable doubt is resolved or (b)
institute a petition for interpleader in (i) the Bankruptcy Court, if the
Bankruptcy Cases remain open, or (ii) a court of competent jurisdiction, if the
Bankruptcy Cases have been closed, to determine the rights of the parties hereto
and pay into such court all applicable funds held by the Escrow Agent for
holding and disbursement. Should a petition for interpleader be instituted, or
should the Escrow Agent be threatened with litigation or become involved in
litigation or binding arbitration in any manner whatsoever in connection with
this Escrow Agreement or the Escrowed Property, Seller and Purchaser hereby
jointly and severally agree to reimburse the Escrow Agent for its reasonable and
documented attorneys' fees and any and all other reasonable and documented
out-of-pocket expenses, losses, costs and damages incurred by the Escrow Agent
in connection with or resulting from such threatened or actual litigation prior
to any disbursement hereunder (other than any such threatened or actual
litigation that results from a material breach by the Escrow Agent of this
Escrow Agreement or the gross negligence, willful misconduct or fraud of the
Escrow Agent).
10. INDEMNIFICATION. Seller and Purchaser hereby jointly and severally
agree to indemnify the Escrow Agent, its officers, directors, partners,
employees and agents (each hereinafter referred to as an "INDEMNIFIED PARTY")
against, and hold each Indemnified Party harmless from, any and all reasonable
and documented out-of-pocket expenses, including, without limitation, reasonable
attorneys' fees and court costs, losses, costs, damages and claims, including,
but not limited to, costs of investigation, litigation, tax liability (other
than taxes payable with respect to fees paid or other income hereunder) suffered
or incurred by any Indemnified Party in connection with or arising from or out
of this Escrow Agreement, except such acts or omissions as may result from the
fraud, willful misconduct or gross negligence of, or material breach of this
Escrow Agreement by, such Indemnified Party. IT IS THE EXPRESS INTENT OF EACH OF
SELLER AND PURCHASER TO INDEMNIFY EACH OF THE INDEMNIFIED PARTIES FOR, AND HOLD
THEM HARMLESS FROM AND AGAINST, SELLER'S OR PURCHASER'S NEGLIGENT ACTS OR
OMISSIONS. If any action or proceeding is brought against any Indemnified Party
with respect to which indemnity may be sought from Seller and Purchaser pursuant
to this SECTION 10, or an Indemnified Party receives notice from any potential
claimant, such Indemnified Party shall, as promptly as practicable after
receiving notice thereof, give written notice to Seller and Purchaser of the
commencement of such action or proceeding or of the existence of any such claim
(any such action, proceeding or notice hereinafter referred to as a "CLAIM") and
furnish Seller and Purchaser with copies of any summons or other legal process
received by such Indemnified Party and other documents and information in the
possession of such Indemnified Party as to the nature and basis of the claim;
provided that no failure to give or delay in giving such notice or such
documents and information shall relieve Seller or Purchaser from any of their
indemnification obligations hereunder except to the extent such obligations
could have been reduced or avoided in the absence of such failure or delay. In
the event that any Claim shall be brought against any Indemnified Party, Seller
and Purchaser will be entitled to participate in the defense of such Claim, and,
after written notice from Seller and Purchaser to such Indemnified Party, to
jointly assume the defense of such Claim with a single counsel mutually agreed
upon and appointed by Seller and Purchaser and which counsel is reasonably
acceptable to such Indemnified Party at Seller's and Purchaser's joint expense
or, alternatively, if only Seller on the one hand, or Purchaser on the other
hand, elect to assume the defense of such Claim, then such electing parties
will, after written notice to the non-electing parties and such Indemnified
Party, be entitled to defend such Claim separately with the cost of such defense
to be shared equally by Seller on the one hand and Purchaser on the other hand
(in each case, Seller or Purchaser shall not thereafter be responsible for the
fees and disbursements of any separate counsel retained by such Indemnified
Party in connection with such action or proceeding, except as provided below in
this paragraph). For the avoidance of doubt, if Seller and Purchaser shall
jointly assume the defense of any Claim against any Indemnified Party, such
defense shall be jointly controlled by Seller and Purchaser and all decisions
relating thereto shall be mutually agreed upon by Seller and Purchaser. If only
Seller on the one hand, or Purchaser on the other hand, shall elect to assume
the defense of any Claim separately, such electing parties shall obtain the
prior written consent of (a) the non-electing parties before entering into any
settlement of such Claim (other than sharing equally in the cost thereof as set
forth above) if the settlement imposes any cost, expense or obligation on the
non-electing parties or does not expressly and unconditionally release the
non-electing parties from all liabilities and obligations with respect to such
Claim and (b) the Indemnified Party if the settlement imposes any cost, expense
or obligation on the Indemnified Party or does not expressly and unconditionally
release the Indemnified Party from all liabilities and obligations with respect
to such Claim. Notwithstanding any election by Seller or Purchaser to assume the
defense of any such Claim, such Indemnified Party shall have the right to employ
separate counsel and to participate in the defense of such Claim at the
Indemnified Party's expense; provided, however that such Indemnified Party shall
not have the right to settle any such Claim without the prior written consent of
Seller and Purchaser. Seller and Purchaser agree to pay the reasonable and
documented fees and disbursements of such separate counsel only if (x) the use
of counsel jointly chosen by Seller and Purchaser to represent such Indemnified
Party would present an actual conflict of interest which it would be
unreasonable to waive or (y) Seller and Purchaser shall authorize such
Indemnified Party to employ separate counsel at the expense of Seller and
Purchaser. If Seller on the one hand, or Purchaser on the other hand, do not
elect, jointly or separately, to assume the defense of a Claim against any
Indemnified Party, such Indemnified Party shall obtain the prior written consent
of Seller and Purchaser before entering into any settlement of such Claim.
Notwithstanding anything to the contrary contained in this SECTION 10, Seller
and Purchaser agree, as between themselves, to share in the aggregate amount of
any indemnifiable costs or expenses for which any Indemnified Party may be
liable in such proportion as is appropriate to reflect their respective relative
fault in connection with the acts or omissions which resulted in such costs or
expenses. The relative fault of Seller on the one hand, and Purchaser on the
other hand, shall be determined by reference to whether the acts or omissions at
issue were those of Seller on the one hand, or Purchaser on the other hand. If
any amount paid by any of the Seller or Purchaser pursuant to this SECTION 10 is
in excess of the amount allocable to it in accordance with the provisions of
this SECTION 10, it shall be entitled to reimbursement of such excess amount
(plus all reasonable attorneys' fees and documented expenses incurred in
connection with enforcing this provision) from the other parties (other than the
Escrow Agent).
11. COMPENSATION AND REIMBURSEMENT OF EXPENSES. Seller, Purchaser and PBGC
hereby agree that the Escrow Agent may withdraw funds out of the Escrowed
Property to satisfy the Escrow Agent's fees for its services hereunder in
accordance with the Escrow Agent's fee schedule as attached as Schedule I hereto
as in effect from time to time; provided, however, the Escrow Agent shall
provide written notice (the "WITHDRAWAL NOTICE") to the Seller, Purchaser and
PBGC ten (10) business days notice of any pending withdrawal of funds in
accordance with this SECTION 11 and shall not effectuate such withdrawal if
Seller, Purchaser or PBGC shall object to such withdrawal prior to the effective
date set forth in the Withdrawal Notice. In addition, Seller, Purchaser and
PBGC, each agree that the Escrow Agent may withdraw funds out of the Escrowed
Property to reimburse the Escrow Agent for all of its reasonable and documented
out-of-pocket expenses incurred by the Escrow Agent in connection with the
performance of its duties and enforcement of its rights hereunder and otherwise
in connection with the operation, administration and enforcement of this Escrow
Agreement, including, without limitation, attorneys' fees, brokerage costs and
related expenses incurred by the Escrow Agent, in each case to the extent
reasonably necessary (collectively, "OTHER EXPENSES"). Notwithstanding the
foregoing, the Escrow Agent shall have no right to withdraw funds from the
Escrowed Property for any Other Expenses to the extent such expenses arise out
of, relate to or result from the Escrow Agent's material breach of this Escrow
Agreement or the gross negligence, willful misconduct or fraud of the Escrow
Agent.
12. FUNDS TRANSFER.
(a) All disbursements of any or all of the Escrowed Property shall be
made by wire transfer of immediately available U.S. Federal Funds to an
account designated by the payee therefor. In the event funds transfer
instructions are given (other than in writing at the time of execution of
this Escrow Agreement), whether in writing, by facsimile, or otherwise, the
Escrow Agent is authorized to seek confirmation of such instructions by
telephone call-back to the person or persons designated on Schedule II
hereto, and the Escrow Agent may rely upon the confirmations of anyone
purporting to be the person or persons so designated. The persons and
telephone numbers for call-backs may be changed only in writing actually
received and acknowledged by the Escrow Agent. The parties to this Escrow
Agreement acknowledge that such security procedure is commercially
reasonable.
(b) It is understood that the Escrow Agent and the beneficiary's bank
in any funds transfer may rely solely upon any account numbers or similar
identifying number provided by Seller, Purchaser or PBGC hereto to identify
(i) the beneficiary, (ii) the beneficiary's bank, or (iii) an intermediary
bank. The Escrow Agent may apply any of the escrowed funds for any payment
order it executes using any such identifying number, even where its use may
result in a person other than the beneficiary being paid, or the transfer
of funds to a bank other than the beneficiary's bank or an intermediary
bank, designated.
13. NOTICES. All notices or other communications under this Escrow
Agreement by any party hereto shall be considered as properly given if in
writing and (a) delivered against receipt therefor, (b) mailed by registered or
certified mail, return receipt requested and postage prepaid or (c) sent by
facsimile machine, in each case to the address or facsimile number, as the case
may be, set forth below:
If to the Escrow Agent, to:
[------------]
Attention:
Facsimile:
If to Seller, to:
Enron Corp.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Weil, Gotshal & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
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Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser, to:
Southern Union Company
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President and COO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
General Electric Capital Corporation
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Attention: Manager of Operations
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.P.
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Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
And a copy to:
Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
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Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to PBGC, to:
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▇▇▇▇▇▇▇ ▇▇▇▇▇
Pension Benefit Guaranty Corporation
Office of the General Counsel
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇ ▇▇▇▇▇
Supervisory Financial Analyst
Corporate Finance and Negotiations Department
Pension Benefit Guaranty Corporation
Office of the General Counsel
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Delivery of any communication given in accordance herewith shall be effective
only upon actual receipt (and in the case of facsimile transmissions when
received during normal business hours) thereof by the party or parties to whom
such communication is directed. Any party to this Escrow Agreement may change
the address to which communications hereunder are to be directed by giving
written notice to the other party or parties hereto in the manner provided in
this SECTION 13. All signatures of the parties to this Escrow Agreement may be
transmitted by facsimile, and such facsimile will, for all purposes, be deemed
to be the original signature of such party whose signature it reproduces, and
will be binding upon such party.
14. CHOICE OF LAWS; CUMULATIVE RIGHTS. This Escrow Agreement shall be
construed and enforced in accordance with and governed by the laws of the State
of New York. All of the Escrow Agent's rights hereunder are cumulative of any
other rights it may have at law, in equity or otherwise.
15. JURISDICTION; SERVICE OF PROCESS.
(a) EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO
SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE BANKRUPTCY COURT FOR ANY AND
ALL DISPUTES, CONTROVERSIES, CONFLICTS, LITIGATION OR ACTIONS ARISING OUT
OF OR RELATING TO THIS ESCROW AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY AND AGREES NOT TO COMMENCE ANY LITIGATION OR ACTIONS ARISING OUT OF
OR RELATING TO THIS ESCROW AGREEMENT EXCEPT IN THE BANKRUPTCY COURT;
PROVIDED, HOWEVER, THAT IF THE BANKRUPTCY CASES HAVE CLOSED, THE PARTIES
AGREE TO UNCONDITIONALLY AND IRREVOCABLY SUBMIT TO THE EXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK SITTING IN NEW YORK COUNTY OR THE COMMERCIAL DIVISION CIVIL
BRANCH OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK
COUNTY AND ANY APPELLATE COURT FROM ANY THEREOF, FOR THE RESOLUTION OF ANY
SUCH DISPUTE, CONTROVERSY, CONFLICT, LITIGATION OR ACTION; NOTWITHSTANDING
THE FOREGOING, Nothing in this Agreement (a) confers jurisdiction on any
bankruptcy court over causes of action involving, or claims against, any
non-debtor under ERISA, or (b) constitutes a waiver or agreement by any
party hereto on any jurisdictional issue involving or in any way relating
to ERISA.
(b) The parties hereby unconditionally and irrevocably waive, to the
fullest extent permitted by Applicable Law, any objection which they may
now or hereafter have to the laying of venue of any dispute arising out of
or relating to this Escrow Agreement or any of the transactions
contemplated hereby brought in any court specified in paragraph (a) above,
or any defense of inconvenient forum for the maintenance of such dispute.
Each of the parties hereto agrees that a judgment in any such dispute may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(c) Each of the parties hereto hereby consents to process being served
by any party to this Escrow Agreement in any suit, Action or proceeding by
the mailing of a copy thereof in accordance with the provisions of Section
13.
16. RESIGNATION. The Escrow Agent may resign hereunder upon thirty (30)
days' prior notice to Seller, Purchaser and the PBGC. Upon the effective date of
such resignation, the Escrow Agent shall deliver the Escrowed Property to any
substitute escrow agent designated in writing by Seller, Purchaser and the PBGC.
Such substitute escrow agent shall be bound to the terms of this Escrow
Agreement until such time as this Escrow Agreement shall be amended or modified
in accordance with the terms hereof. If Seller, Purchaser and the PBGC fail to
designate a substitute escrow agent within thirty (30) days after the giving of
such notice, the Escrow Agent may institute a petition for interpleader. The
Escrow Agent's sole responsibilities after such 30-day notice period expires
shall be to (i) hold the Escrowed Property, and (ii) deliver the same to a
designated substitute escrow agent, if any, or in accordance with the directions
of a final order or judgment of (A) the Bankruptcy Court, if the Bankruptcy
Cases remain open, or (B) a court of competent jurisdiction, if the Bankruptcy
Cases have been closed, at which time of delivery the Escrow Agent's obligations
hereunder shall cease and terminate, except that such resignation shall not
relieve the Escrow Agent from any liability, losses, costs, damages or claims
that result from a material breach by the Escrow Agent of this Escrow Agreement
or the gross negligence, willful misconduct or fraud of the Escrow Agent. The
Escrow Agent or successor agent shall continue to act as escrow agent hereunder
until a successor is appointed and qualified to act as the escrow agent.
17. TERMINATION BY PURCHASER AND SELLER. By mutual agreement, Purchaser and
Seller shall have the right at any time upon not less than ten (10) days' prior
written notice to the Escrow Agent to terminate their appointment of the Escrow
Agent as the escrow agent, or any successor escrow agent, as escrow agent
hereunder. The Escrow Agent or successor agent shall continue to act as escrow
agent hereunder until a successor is appointed and qualified to act as the
escrow agent.
18. BINDING EFFECT; ASSIGNMENT. This Escrow Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors and
permitted assigns. Except as set forth in SECTION 10 hereof, nothing in this
Escrow Agreement shall create or be deemed to create any third party beneficiary
rights in any Person not party to this Escrow Agreement. No assignment of this
Escrow Agreement or of any rights or obligations hereunder may be made by any of
Seller, Purchaser, or the Escrow Agent (by operation of law or otherwise)
without the prior written consent (not to be unreasonably withheld, conditioned
or delayed) of the other parties hereto and any attempted assignment without the
required consent shall be void; provided, however, that Seller and Purchaser
shall have the right to assign this Escrow Agreement to their respective
Affiliates, provided that notice of such assignment is promptly given the Escrow
Agent and the other parties hereto upon or immediately following such
assignment.
19. SEVERABILITY. If one or more of the provisions hereof shall for any
reason be held to be invalid, illegal or unenforceable in any respect under
applicable law, such invalidity, illegality or unenforceability shall not affect
any other provisions hereof, and this Escrow Agreement shall be construed as if
such invalid, illegal or unenforceable provision had never been contained
herein, and the remaining provisions hereof shall be given full force and
effect.
20. TERMINATION. This Escrow Agreement shall terminate upon the
disbursement, in accordance with the terms hereof, of the Escrowed Property in
full; provided, however, that in the event all fees, expenses, costs and other
amounts required to be paid to the Escrow Agent hereunder are not fully and
finally paid prior to termination, the provisions of SECTIONS 8, 9 and 10 hereof
shall survive the termination hereof; and provided, further, that such
termination shall not relieve the Escrow Agent from any liability, losses,
costs, damages or claims that result from a material breach by the Escrow Agent
of this Escrow Agreement or the gross negligence, willful misconduct or fraud of
the Escrow Agent.
21. NO RIGHT OF SET-OFF. Except as set forth in SECTION 11 hereof, the
Escrow Agent hereby unconditionally and irrevocably waives any and all rights to
set-off, netting, offset, recoupment, or similar rights that it has or may have
against the Escrowed Property including, without limitation, claims arising as a
result of any claims, amounts, liabilities, costs, expenses, damages, or other
losses that Escrow Agent may be otherwise entitled to collect from any party to
this Escrow Agreement.
22. HEADINGS. The section headings contained in this Escrow Agreement are
for reference purposes only and are to be given no effect in the construction or
interpretation of this Escrow Agreement.
23. COUNTERPARTS. This Escrow Agreement and any document required to be
provided hereunder may be executed in any number of counterparts, each of which
will be deemed an original, but all of which together will constitute one and
the same instrument. All signatures of the parties to this Escrow Agreement may
be transmitted by facsimile, and such facsimile will, for all purposes, be
deemed to be the original signature of such party whose signature it reproduces,
and will be binding upon such party.
24. ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS. This Escrow Agreement
represents the entire understanding and agreement between the parties hereto
with respect to the subject matter hereof, and neither Seller and Purchaser, on
one hand, and the Escrow Agent, on the other hand, has relied on any
representations or agreements of the other, except as specifically set forth in
this Escrow Agreement. This Escrow Agreement can be amended, supplemented or
changed, and any provision hereof can be waived, only by written instrument
making specific reference to this Escrow Agreement signed by Seller and
Purchaser and upon written notice to the PBGC. In addition, Sections 2, 3(b), 4,
5, 9, 15, 16, 20 and 24 shall not be amended, nor shall any other amendment of
this Escrow Agreement be effective if it materially adversely affects the
interests of the PBGC, without the written consent of the PBGC. No action taken
pursuant to this Escrow Agreement, including, without limitation, any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any agreement
contained herein. The waiver by any party hereto of a breach of any provision of
this Escrow Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by Law. This Escrow Agreement or
any provision hereof may be amended, modified, waived or terminated only by
written instrument duly signed by the parties hereto.
25. EFFECT ON PBGC CLAIMS. This Escrow Agreement shall not be deemed or
interpreted to limit the rights of the PBGC in respect of its proofs of claim
filed in the chapter 11 cases of Seller and its debtor affiliates and,
notwithstanding any other provision contained herein, nothing contained in this
Escrow Agreement shall be construed as limiting, restricting or otherwise
affecting: (i) the rights, interests, claims and causes of action, if any, of
the PBGC, that may be brought under ERISA, including but not limited to,
perfecting liens and filing or otherwise pursuing any claims and causes of
action, if any, applicable to any entity, or (ii) the rights of Seller or any
other party-in-interest in the chapter 11 cases of the Seller and its debtor
affiliates to assert defenses with respect to any claim filed by the PBGC or any
cause of action referred to in subparagraph (i) of this Section 25.
26. INDEMNITY CLAIMS. Purchaser hereby agrees that, notwithstanding
anything to the contrary in the Purchase Agreement, the satisfaction of all
claims under Section 9.11 of the Purchase Agreement related to amounts imposed
upon or assessed against Purchaser or a Transfer Group Company by the PBGC with
respect to any of the Seller Plans will first be pursued under this Escrow
Agreement and satisfied from the Escrowed Property.
27. GENERAL. If performance by any party to this Escrow Agreement is
delayed or prevented by any act of God, terrorism, fire, flood or other
casualty, strike, national emergency or other cause beyond the reasonable
control of a party, then the period of such party's performance of the
applicable obligation shall be automatically extended for the same amount of
time that such party is so delayed or hindered. The affected party shall use its
best efforts to remove the cause of delay and shall notify the other parties to
this Escrow Agreement in writing of any such delay or failure promptly after the
commencement of the event relied upon for its delay or failure to comply with
its obligations.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF the parties hereto have executed this Escrow
Agreement to be effective as of the date first above written.
[_________________]2
By:
-----------------------------------------
Name:
Title:
--------------------------------------------------------------------------------
TAX CERTIFICATION: Taxpayer ID#: ▇▇-▇▇▇▇▇▇▇
NOTE: THE FOLLOWING CERTIFICATION SHALL BE USED BY AND FOR A U.S. RESIDENT ONLY.
NON-RESIDENTS MUST USE AND PROVIDE FORM W8-BEN
---------------------------
Customer is a (check one):
X Corporation ___ Municipality ___Partnership ___ Non-profit or Charitable Org
----
___ Individual ___ REMIC ___ Trust ___ Other: Limited Liability Company
Under the penalties of perjury, the undersigned certifies that:
(1) the entity is organized under the laws of the United States;
(2) the number shown above is its correct Taxpayer Identification Number (or it
is waiting for a number to be issued to it); and
(3) it is not subject to backup withholding because: (a) it is exempt from
backup withholding or (b) it has not been notified by the Internal Revenue
Service (IRS) that it is subject to backup withholding as a result of
failure to report all interest or dividends, or (c) the IRS has notified it
that it is no longer subject to backup withholding.
(If the entity is subject to backup withholding, cross out the words after the
(3) above.)
Investors who do not supply a tax identification number will be subject to
backup withholding in accordance with IRS regulations.
--------------------------------------------------------------------------------
Note: The IRS does not require your consent to any provision of this
document other than the certifications required to avoid backup withholding.
ENRON CORP.
By:
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ III
Title: Managing Director,
Corporate Development
--------------------------------------------------------------------------------
TAX CERTIFICATION: Taxpayer ID#: ▇▇-▇▇▇▇▇▇▇
--------------------------------------
NOTE: THE FOLLOWING CERTIFICATION SHALL BE USED BY AND FOR A U.S. RESIDENT ONLY.
NON-RESIDENTS MUST USE AND PROVIDE FORM W8-BEN
-----------------------
Customer is a (check one):
___ Corporation ___ Municipality ___Partnership ___ Non-profit or Charitable Org
___ Individual ___ REMIC ___ Trust X Other: LIMITED LIABILITY COMPANY
-----
Under the penalties of perjury, the undersigned certifies that:
(1) the entity is organized under the laws of the United States;
(2) the number shown above is its correct Taxpayer Identification Number (or it
is waiting for a number to be issued to it); and
(3) it is not subject to backup withholding because: (a) it is exempt from
backup withholding or (b) it has not been notified by the Internal Revenue
Service (IRS) that it is subject to backup withholding as a result of
failure to report all interest or dividends, or (c) the IRS has notified it
that it is no longer subject to backup withholding.
(If the entity is subject to backup withholding, cross out the words after the
(3) above.)
Investors who do not supply a tax identification number will be subject to
backup withholding in accordance with IRS regulations.
--------------------------------------------------------------------------------
Note: The IRS does not require your consent to any provision of this
document other than the certifications required to avoid backup withholding.
CCE HOLDINGS, LLC
By:
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
--------------------------------------------------------------------------------
TAX CERTIFICATION: Taxpayer ID#:
NOTE: THE FOLLOWING CERTIFICATION SHALL BE USED BY AND FOR A U.S. RESIDENT ONLY.
NON-RESIDENTS MUST USE AND PROVIDE FORM W8-BEN
-----------------------
Customer is a (check one):
___ Corporation ___Municipality ___ Partnership ___ Non-profit or Charitable Org
___ Individual ___ REMIC ___ Trust Other:
----
Under the penalties of perjury, the undersigned certifies that:
(1) the entity is organized under the laws of the United States;
(2) the number shown above is its correct Taxpayer Identification Number (or it
is waiting for a number to be issued to it); and
(3) it is not subject to backup withholding because: (a) it is exempt from
backup withholding or (b) it has not been notified by the Internal Revenue
Service (IRS) that it is subject to backup withholding as a result of
failure to report all interest or dividends, or (c) the IRS has notified it
that it is no longer subject to backup withholding.
(If the entity is subject to backup withholding, cross out the words after the
(3) above.)
Investors who do not supply a tax identification number will be subject to
backup withholding in accordance with IRS regulations.
--------------------------------------------------------------------------------
Note: The IRS does not require your consent to any provision of this
document other than the certifications required to avoid backup withholding.
PENSION BENEFIT GUARANTY CORPORATION
By:
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: General Counsel
SCHEDULE I
ESCROW AGENT FEE SCHEDULES
================================================================================
SCHEDULE OF FEES FOR THE ESCROW AGENT'S SERVICES
================================================================================
NEW ACCOUNT ACCEPTANCE FEE..........................................$750 WAIVED
Payable upon Account Opening
MINIMUM ADMINISTRATIVE FEE................................................$3,500
Payable Upon Account Opening and in Advance for each year in which we
act as Escrow Agent
ACTIVITY FEES:
DISBURSEMENTS
Per Check....................................................................$35
Per Wire U.S.....................................$35
International..........................$100
RECEIPTS
Per Check....................................................................$10
Per Wire.....................................................................$10
INVESTMENTS
Per directed buy/sell).......................................................$50
LEGAL EXPENSES:..........................................................AT COST
There will be no legal expenses if this Escrow Agreement is employed without
substantial substantive amendments.
A New Account Acceptance Fee will be charged for the Bank's review of this
Escrow Agreement along with any related account documentation. A one (1) year
Minimum Administrative Fee will be assessed for any account which is funded. The
account will be invoiced in the month in which the account is opened and
annually thereafter. Payment of the invoice is due 30 days following receipt.
The Administrative Fee will cover a maximum of fifteen (15) annual
administrative hours for the Bank's standard escrow services including account
setup, safekeeping of assets, investment of funds, collection of income and
other receipts, preparation of statements comprising account activity and asset
listing, and distribution of assets in accordance with the specific terms of
this Escrow Agreement.
EXTRAORDINARY SERVICES AND OUT-OF POCKET EXPENSES:
After this Escrow Agreement is executed and the escrow account is funded with
the Deposit, any additional services beyond our standard services as specified
above, such as annual administrative activities in excess of fifteen (15) hours
and all reasonable and documented out-of-pocket expenses including reasonable
attorney's fees will be considered extraordinary services for which related
costs, transaction charges, and additional fees will be billed at the Bank's
standard rate.
MODIFICATION OF FEES:
Circumstances may arise necessitating a change in the foregoing fee schedule.
The Bank will attempt at all times, however, to maintain the fees at a level
which is fair and reasonable in relation to the responsibilities assumed and the
duties performed.
ASSUMPTIONS:
o The escrow deposit shall be continuously invested in JPMorgan US Govt.
#220 Money Market Fund. The Minimum Administrative Fee would include A
SUPPLEMENTAL CHARGE OF 50 BASIS POINTS on the escrow deposit amount if
another investment option is chosen.
o The account will be invoiced in the month in which the account is
opened and annually thereafter.
o Payment of the invoice is due 30 days following receipt.
SCHEDULE II
TELEPHONE NUMBER(S) FOR CALL-BACKS AND PERSON(S)
DESIGNATED TO CONFIRM FUNDS TRANSFER INSTRUCTIONS
(Need at least three individuals from each party)
IF TO SELLER:
NAME TELEPHONE
---- ---------
1. ▇▇▇▇ ▇▇▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
2. ▇▇▇▇▇ Moehlrnan (▇▇▇) ▇▇▇-▇▇▇▇
3. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
4. ▇▇▇ Round (▇▇▇) ▇▇▇-▇▇▇▇
IF TO PURCHASER:
NAME TELEPHONE
---- ---------
1. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
2. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
IF TO PBGC:
NAME TELEPHONE
---- ---------
1. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
2. ▇▇▇▇ ▇. ▇▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
Telephone call-backs shall be made to Seller or Purchaser if joint instructions
are required pursuant to this Escrow Agreement.
______________________________
1 Bank to be a national or state bank having assets of $100,000,000,000 or more,
as mutually agreed by Seller and Purchaser.
2 To be determined, upon mutual agreement between Seller and Purchaser.
