Exhibit 4.13
THE AES CORPORATION
GUARANTEE AGREEMENT
Dated as of __________, 199_
TABLE OF CONTENTS
Page
ARTICLE I
SECTION 1.1 Definitions....................................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.................. 5
SECTION 2.2 Lists of Holders of Preferred Securities.......... 5
SECTION 2.3 Reports by the Guarantee Trustee.................. 6
SECTION 2.4 Periodic Reports to Guarantee Trustee............. 6
SECTION 2.5 Evidence of Compliance with
Conditions Precedent.............................. 6
SECTION 2.6 Events of Default; Waiver......................... 6
SECTION 2.7 Disclosure of Information......................... 7
SECTION 2.8 Conflicting Interest.............................. 7
ARTICLE III
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee Trustee........ 7
SECTION 3.2 Certain Rights and Duties of the
Guarantee Trustee................................. 8
SECTION 3.3 Not Responsible for Recitals or Issuance
of Guarantee...................................... 11
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Qualifications.................................... 11
SECTION 4.2 Appointment, Removal and Resignation
of Guarantee Trustee.............................. 12
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee......................................... 13
SECTION 5.2 Waiver of Notice.................................. 13
SECTION 5.3 Obligations Not Affected.......................... 14
SECTION 5.4 Enforcement of Guarantee.......................... 15
SECTION 5.5 Guarantee of Payment.............................. 15
SECTION 5.6 Subrogation....................................... 15
SECTION 5.7 Independent Obligations........................... 16
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions........................ 16
SECTION 6.2 Subordination..................................... 17
ARTICLE VII
TERMINATION
SECTION 7.1 Termination....................................... 17
ARTICLE VIII
LIMITATION OF LIABILITY; INDEMNIFICATION
SECTION 8.1 Exculpation....................................... 17
SECTION 8.2 Indemnification................................... 18
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns............................ 19
SECTION 9.2 Amendments........................................ 19
SECTION 9.3 Notices........................................... 19
SECTION 9.4 Genders........................................... 20
SECTION 9.5 Benefit........................................... 20
SECTION 9.6 Governing Law..................................... 20
SECTION 9.7 Counterparts...................................... 20
SECTION 9.8 Exercise of Overallotment Option.................. 20
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of __________, 199_, is
executed and delivered by The AES Corporation, a Delaware corporation (the
"Guarantor"), and The First National Bank of Chicago, a national banking
association, as the initial Guarantee Trustee (as defined herein) for the
benefit of the Holders (as defined herein) from time to time of the Preferred
Securities (as defined herein) of AES Trust ___, a Delaware statutory business
trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of ______________, 199_ among the trustees
of the Issuer named therein, The AES Corporation, as Sponsor, and the Holders
from time to time of undivided beneficial interests in the assets of the
Issuer, the Issuer may issue up to _______________ aggregate liquidation
amount of its _____% Preferred Trust Securities (the "Preferred Securities")
representing undivided beneficial interests in the assets of the Issuer and
having the terms set forth in Exhibit B to the Declaration, of which
$_____________ liquidation amount of Preferred Securities are being issued as
of the date hereof. Up to the remaining $______________ liquidation amount of
Preferred Securities may be issued by the Issuer if and to the extent that the
over-allotment option granted by the Guarantor and the Issuer pursuant to the
Underwriting Agreement (as defined in the Declaration) is exercised by the
Underwriters named in the Underwriting Agreement.
WHEREAS, as incentive for the Holders to purchase Preferred
Securities, the Guarantor desires to irrevocably and unconditionally agree, to
the extent set forth herein, to pay to the Holders of the Preferred Securities
the Guarantee Payments (as defined herein) and to make certain other payments
on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by the initial
purchasers thereof of Preferred Securities, which purchase the Guarantor
hereby agrees shall benefit the Guarantor, the Guarantor executes and delivers
this Guarantee Agreement for the benefit of the Holders from time to time of
the Preferred Securities.
ARTICLE I
SECTION 1.1 Definitions.
(a) Capitalized terms used in this Guarantee Agreement but not
defined in the preamble above have the respective meanings assigned to them in
this Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as modified, supplemented
or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless otherwise defined in this
Guarantee Agreement or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule
thereunder.
"Commission" means the Securities and Exchange Commission.
"Common Securities" means the securities representing undivided
beneficial interests in the assets of the Issuer, having the terms set forth
in Exhibit C to the Declaration.
"Covered Person" means any Holder of Preferred Securities.
"Debentures" means the series of Junior Subordinated Debentures
issued by the Guarantor under the Indenture to the Property Trustee and
entitled the "_____% Junior Subordinated Debentures due ____".
"Distributions" means the periodic distributions and other
payments payable to Holders of Preferred Securities in accordance with the
terms of the Preferred Securities set forth in Exhibit B to the Declaration.
"Event of Default" means a default by the Guarantor on any of
its payment or other obligations under this Guarantee Agreement.
"Guarantee Payments" shall mean the following payments or
distributions, without duplication, with respect to the Preferred Securities,
to the extent not paid or made by the Issuer: (i) any accrued and unpaid
Distributions and the redemption price, including all accrued and unpaid
Distributions to the date of redemption (the "Redemption Price"), with respect
to the Preferred Securities called for redemption by the Issuer but only if
and to the extent that in each case the Guarantor has made a payment to the
Property Trustee of interest or principal on the Debentures and (ii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Debentures to Holders or
the redemption of all the Preferred Securities upon the maturity or redemption
of the Debentures as provided in the Declaration), the lesser of (a) the
aggregate of the liquidation amount and all accrued and unpaid Distributions
on the Preferred Securities to the date of payment, to the extent the Issuer
has funds available therefor, or (b) the amount of assets of the Issuer
remaining available for distribution to Holders in liquidation of the Issuer
(in either case, the "Liquidation Distribution").
"Guarantee Trustee" means [NAME OF GUARANTEE TRUSTEE] until a
Successor Guarantee Trustee has been appointed and accepted such appointment
pursuant to the terms of this Guarantee Agreement and thereafter means each
such Successor Guarantee Trustee.
"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any Preferred Securities; provided, however, that in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any entity directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Guarantor.
"Indemnified Person" means the Guarantee Trustee, any Affiliate
of the Guarantee Trustee, and any officers, directors, shareholders, members,
partners, employees, representatives or agents of the Guarantee Trustee.
"Indenture" means the Junior Subordinated Indenture dated as of
_____ __, 1996 between the Guarantor and [NAME OF TRUSTEE] as trustee, as
supplemented by the [ ] Supplemental Indenture thereto dated as of
___________ 199___, pursuant to which the Debentures are to be issued.
"Majority in liquidation amount of the Preferred Securities"
means, except as otherwise required by the Trust Indenture Act, Holder(s) of
outstanding Preferred Securities voting together as a single class, who are
the record owners of Preferred Securities whose liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) represents more than 50% of the liquidation amount
of all outstanding Preferred Securities.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Securities" has the meaning set forth in the first
WHEREAS clause above.
"Property Trustee" means the Person acting as Property Trustee
under the Declaration.
"Redemption Price" means the amount payable on redemption of
the Preferred Securities in accordance with the terms of the Preferred
Securities.
"Responsible Officer" means, with respect to the Guarantee
Trustee, the chairman of the board of directors, the president, any
vice-president, any assistant vice-president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or
assistant trust officer or any other officer of the Guarantee Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"66-2/3% in liquidation amount of the Preferred Securities"
means, except as otherwise required by the Trust Indenture Act, Holder(s) of
outstanding Preferred Securities voting together as a single class who are the
record owners of Preferred Securities whose liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accrued and unpaid Distributions to the date upon which the voting percentages
are determined) represents 66-2/3% or more of the liquidation amount of all
Preferred Securities.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as a Guarantee Trustee under
Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of
the Trust Indenture Act that are required to be part of this Guarantee
Agreement and shall, to the extent applicable, be governed by such provisions;
(b) if and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Section
Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed
duties shall control; and
(c) the application of the Trust Indenture Act to this
Guarantee Agreement shall not affect the nature of the Preferred Securities as
equity securities representing undivided beneficial interests in the assets of
the Issuer.
SECTION 2.2 Lists of Holders of Preferred Securities.
(a) The Guarantor shall provide the Guarantee Trustee with
such information as is required under Section 312(a) of the Trust Indenture
Act at the times and in the manner provided in Section 312(a); and
(b) the Guarantee Trustee shall comply with its obligations
under Section Section 310(b), 311 and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Guarantee Trustee.
Within 60 days after May 15 of each year, the Guarantee Trustee
shall provide to the Holders of the Preferred Securities such reports as are
required by Section 313 of the Trust Indenture Act, if any, in the form, in
the manner and at the times provided by Section 313 of the Trust Indenture
Act. The Guarantee Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, the
Commission and the Holders of the Preferred Securities, as applicable, such
documents, reports and information as required by Section 314(a)(1)-(3) (if
any) of the Trust Indenture Act and the compliance certificates required by
Section 314(a)(4) and (c) of the Trust Indenture Act, any such certificates
to be provided in the form, in the manner and at the times required by Section
314(a)(4) and (c) of the Trust Indenture Act (provided that any certificate to
be provided pursuant to Section 314(a)(4) of the Trust Indenture Act shall be
provided within 120 days of the end of each fiscal year of the Issuer).
SECTION 2.5 Evidence of Compliance with
Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Guarantee Agreement which relate to any of the matters set forth in
Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given pursuant to Section 314(c) shall comply with Section
314(e) of the Trust Indenture Act.
SECTION 2.6 Events of Default; Waiver.
(a) Subject to Section 2.6(b), Holders of Preferred Securities
may by vote of at least a Majority in liquidation amount of the Preferred
Securities, (A) direct the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee, or exercising any trust or
power conferred upon by the Guarantee Trustee or (B) on behalf of the Holders
of all Preferred Securities waive any past Event of Default and its
consequences. Upon such waiver, any such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Guarantee Agreement, but no such waiver shall extend to
any subsequent or other default or Event of Default or impair any right
consequent thereon.
(b) The right of any Holder of Preferred Securities to receive
payment of the Guarantee Payments in accordance with this Guarantee Agreement,
or to institute suit for the enforcement of any such payment, shall not be
impaired without the consent of each such Holder.
SECTION 2.7 Disclosure of Information.
The disclosure of information as to the names and addresses of
the Holders of the Preferred Securities in accordance with Section 312 of the
Trust Indenture Act, regardless of the source from which such information was
derived, shall not be deemed to be a violation of any existing law, or any law
hereafter enacted which does not specifically refer to Section 312 of the
Trust Indenture Act, nor shall the Guarantee Trustee be held accountable by
reason of mailing any material pursuant to a request made under Section
312(b) of the Trust Indenture Act.
SECTION 2.8 Conflicting Interest.
The Declaration shall be deemed to be specifically described in
this Guarantee Agreement for the purposes of clause (i) of the first proviso
contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee
Trustee in trust for the benefit of the Holders of the Preferred Securities.
The Guarantee Trustee shall not transfer its right, title and interest in the
Guarantee Agreement to any Person except a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Guarantee Trustee or to a Holder of Preferred Securities exercising his or her
rights pursuant to Section 5.4. The right, title and interest of the
Guarantee Trustee to the Guarantee Agreement shall vest automatically in each
Person who may hereafter be appointed as Guarantee Trustee in accordance with
Article IV. Such vesting and cessation of title shall be effective whether or
not conveyancing documents have been executed and delivered.
(b) If an Event of Default occurs and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of
the Holders of the Preferred Securities.
(c) This Guarantee Agreement and all moneys received by the
Property Trustee hereunder in respect of the Guarantee Payments will not be
subject to any right, charge, security interest, lien or claim of any kind in
favor of, or for the benefit of that Guarantee Trustee or its agents or their
creditors.
(d) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the holders of the Preferred Securities, as their names and
addresses appear upon the register, notice of all Events of Default known to
the Guarantee Trustee, unless such defaults shall have been cured before the
giving of such notice; provided, that, the Guarantee Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee, or a trust committee of directors and/or Responsible
Officers, of the Guarantee Trustee in good faith determine that the
withholding of such notice is in the interests of the Holders of the Preferred
Securities. The Guarantee Trustee shall not be deemed to have knowledge of
any default except any default as to which the Guarantee Trustee shall have
received written notice or a Responsible Officer charged with the
administration of this Guarantee Agreement shall have obtained written notice.
(e) The Guarantee Trustee shall not resign as a Trustee unless
a Successor Guarantee Trustee has been appointed and accepted that appointment
in accordance with Article IV.
SECTION 3.2 Certain Rights and Duties of the
Guarantee Trustee.
(a) The Guarantee Trustee, before the occurrence of an Event
of Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants shall be read into
this Guarantee Agreement against the Guarantee Trustee. In case an Event of
Default has occurred (that has not been cured or waived pursuant to Section
2.6(a)), the Guarantee Trustee shall exercise such of the rights and powers
vested in it by this Guarantee Agreement, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) No provision of this Guarantee Agreement shall be
construed to relieve the Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Guarantee Trustee shall
be determined solely by the express provisions of this
Guarantee Agreement, and the Guarantee Trustee shall not
be liable except for the performance of such duties and
obligations as are specifically set forth in this
Guarantee Agreement, and no implied covenants or
obligations shall be read into this Guarantee Agreement
against the Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Guarantee
Trustee, the Guarantee Trustee may conclusively rely, as
to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or
opinions furnished to the Guarantee Trustee and
conforming to the requirements of this Guarantee
Agreement; but in the case of any such certificates or
opinions that by any provision hereof are specifically
required to be furnished to the Guarantee Trustee, the
Guarantee Trustee shall be under a duty to examine the
same to determine whether or not they conform to the
requirements of this Guarantee Agreement;
(ii) the Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Guarantee
Trustee, unless it shall be proved that the Guarantee Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Guarantee Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of Preferred Securities
as provided herein relating to the time, method and place of
conducting any proceeding for any remedy available to the Guarantee
Trustee, or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties
or in the exercise of any of its rights or powers, if it shall have
reasonable ground for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this
Guarantee Agreement or adequate indemnity against such risk or
liability is not reasonably assured to it.
(c) Subject to the provisions of Section 3.2(a) and (b):
(i) whenever in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a
matter be proved or established prior to taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon a certificate, which
shall comply with the provisions of Section 314(e) of the Trust
Indenture Act, signed by any authorized officer of the Guarantor;
(ii) the Guarantee Trustee (A) may consult with counsel (which
may be counsel to the Guarantor or any of its Affiliates and may
include any of its employees) selected by it in good faith and with
due care and the written advice or opinion of such counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon and in accordance with
such advice and opinion and (B) shall have the right at any time to
seek instructions concerning the administration of this Guarantee
Agreement from any court of competent jurisdiction;
(iii) the Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or
by or through agents or attorneys and the Guarantee Trustee shall not
be responsible for any misconduct or negligence on the part of any
agent or attorney appointed by it in good faith and with due care;
(iv) the Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee
Agreement at the request or direction of any Holders of Preferred
Securities, unless such Holders shall have offered to the Guarantee
Trustee reasonable security and indemnity against the costs, expenses
(including its attorneys' fees and expenses) and liabilities that
might be incurred by it in complying with such request or direction;
provided that nothing contained in this clause (iv) shall relieve the
Guarantee Trustee of the obligation, upon the occurrence of an Event
of Default (which has not been cured or waived) to exercise such of
the rights and powers vested in it by this Guarantee Agreement, and
to use the same degree of care and skill in this exercise, as a
prudent person would exercise or use under the circumstances in the
conduct of his or her own affairs; and
(v) any action taken by the Guarantee Trustee or its agents
hereunder shall bind the Holders of the Preferred Securities and the
signature of the Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action; and no third
party shall be required to inquire as to the authority of the
Guarantee Trustee to so act, or as to its compliance with any of the
terms and provisions of this Guarantee Agreement, both of which shall
be conclusively evidenced by the Guarantee Trustee's or its agent's
taking such action.
SECTION 3.3 Not Responsible for Recitals or Issuance
of Guarantee.
The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor and the Guarantee Trustee does not assume any
responsibility for their correctness. The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee Agreement.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Qualifications.
(a) There shall at all times be a Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at
least $50,000,000, and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If
such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the supervising or
examining authority referred to above, then for the purposes of this
Section 4.1(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
If at any time the Guarantee Trustee shall cease to satisfy the
requirements of clauses (i)-(ii) above, the Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2.
If the Guarantee Trustee has or shall acquire any "conflicting interest"
within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and the Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation
of Guarantee Trustee.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed or
removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed in accordance with Section
4.2(a) until a Successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.1(a) has
been appointed and has accepted such appointment by written
instrument executed by such Successor Guarantee Trustee and delivered
to the Guarantor and the Guarantee Trustee being removed.
(c) The Guarantee Trustee appointed to office shall hold office until his
successor shall have been appointed or until its removal or
resignation.
(d) The Guarantee Trustee may resign from office (without need for prior
or subsequent accounting) by an instrument (a "Resignation Request")
in writing signed by the Guarantee Trustee and delivered to the
Guarantor, which resignation shall take effect upon such delivery or
upon such later date as is specified therein; provided, however, that
no such resignation of the Guarantee Trustee shall be effective until
a Successor Guarantee Trustee possessing the qualifications to act as
Guarantee Trustee under Section 4.1(a) has been appointed and has
accepted such appointment by instrument executed by such Successor
Guarantee Trustee and delivered to Guarantor and the resigning
Guarantee Trustee.
(e) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 60 days
after delivery to the Guarantor of a Resignation Request, the
resigning Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor Guarantee Trustee. Such
court may thereupon after such notice, if any, as it may deem proper
and prescribe, appoint a Successor Guarantee Trustee.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer) regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert. The Guarantor's obligation
to make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders.
SECTION 5.2 Waiver of Notice.
The Guarantor hereby waives notice of acceptance of this
Guarantee Agreement and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and
all other notices and demands.
SECTION 5.3 Obligations Not Affected.
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any express or
implied agreement, covenant, term or condition relating to the
Preferred Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions (other than an extension of time
for payment of Distributions that results from the extension of any
interest payment period on the Debentures), Redemption Price,
Liquidation Distribution (as defined in the Declaration) or any other
sums payable under the terms of the Preferred Securities or the
extension of time for the performance of any other obligation under,
arising out of, or in connection with, the Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the
terms of the Preferred Securities, or any action on the part of the
Issuer granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Issuer or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the
Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor,
it being the intent of this Section 5.3 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of
the foregoing.
SECTION 5.4 Enforcement of Guarantee.
The Guarantor and the Guarantee Trustee expressly acknowledge
that (i) this Guarantee Agreement will be deposited with the Guarantee Trustee
to be held for the benefit of the Holders; (ii) the Guarantee Trustee has the
right to enforce this Guarantee Agreement on behalf of the Holders; (iii)
Holders representing not less than a Majority in liquidation amount of the
Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available in respect of this
Guarantee Agreement including the giving of directions to the Guarantee
Trustee, or exercising any trust or other power conferred upon the Guarantee
Trustee under this Guarantee Agreement, and (iv) if the Guarantee Trustee fails
to enforce this Guarantee Agreement, any Holder of Preferred Securities may
institute a legal proceeding directly against the Guarantor to enforce its
rights under this Guarantee Agreement, without first instituting a legal
proceeding against the Issuer, the Guarantee Trustee, or any other Person.
SECTION 5.5 Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not
merely of collection. This Guarantee Agreement will not be discharged except
by payment of the Guarantee Payments in full (without duplication of amounts
theretofore paid by the Issuer).
SECTION 5.6 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the
Holders against the Issuer in respect of any amounts paid to the Holders by
the Guarantor under this Guarantee Agreement; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any rights which it may acquire by way
of subrogation or any indemnity, reimbursement or other agreement, in all
cases as a result of payment under this Guarantee Agreement, if, at the time
of any such payment, any amounts are due and unpaid under this Guarantee
Agreement. If any amount shall be paid to the Guarantor in violation of the
preceding sentence, the Guarantor agrees to hold such amount in trust for the
Holders and to pay over such amount to the Holders.
SECTION 5.7 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Guarantee
Agreement notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.
So long as any Preferred Securities remain outstanding, the
Guarantor will not declare or pay dividends on, or redeem, purchase, acquire
or make a distribution or liquidation payment with respect to, any of its
common stock or preferred stock or make any guarantee payment with respect
thereto if at such time (i) the Guarantor shall be in default with respect to
its Guarantee Payments or other payment obligations hereunder, (ii) there
shall have occurred any event of default under the Declaration or (iii) the
Guarantor shall have given notice of its selection of an Extension Period (as
defined in the Indenture) and such period, or any extension thereof, is
continuing; provided that (a) the Guarantor will be permitted to pay accrued
dividends (and cash in lieu of fractional shares) upon the conversion of any
preferred stock of the Guarantor as may be outstanding from time to time, in
each case in accordance with the terms of such stock and (b) the foregoing
will not apply to any stock dividends paid by the Guarantor. In addition, so
long as any Preferred Securities remain outstanding, the Guarantor (i) will
remain the sole direct or indirect owner of all of the outstanding Common
Securities and shall not cause or permit the Common Securities to be
transferred except to the extent such transfer is permitted under Section
9.1(c) of the Declaration; provided that any permitted successor of the
Guarantor under the Indenture may succeed to the Guarantor's ownership of the
Common Securities and (ii) will use reasonable efforts to cause the Issuer to
continue to be treated as a grantor trust for United States federal income tax
purposes except in connection with a distribution of Debentures as provided in
the Declaration.
SECTION 6.2 Subordination.
This Guarantee Agreement will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right
of payment to all other liabilities of the Guarantor, including the Debentures,
except those made pari passu or subordinate by their terms, and (ii) senior to
all capital stock now or hereafter issued by the Guarantor and to any
guarantee now or hereafter entered into by the Guarantor in respect of any of
its capital stock. The Guarantor's obligations under this Guarantee Agreement
will rank pari passu with respect to obligations under other guarantee
agreements which it may enter into from time to time to the extent that such
agreements shall be entered into in substantially the form hereof and provide
for comparable guarantees by the Guarantor of payment on preferred securities
issued by other DLJ Capital Trusts.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.
This Guarantee Agreement shall terminate and be of no further
force and effect upon full payment of the Redemption Price of all Preferred
Securities, or upon the distribution of Debentures to Holders of Preferred
Securities and Common Securities in exchange for all of the Preferred
Securities and Common Securities, or upon full payment of the amounts payable
in accordance with the Declaration upon liquidation of the Issuer.
Notwithstanding the foregoing, this Guarantee Agreement will continue to be
effective or will be reinstated, as the case may be, if at any time any Holder
must restore payment of any sums paid with respect to the Preferred Securities
or this Guarantee Agreement.
ARTICLE VIII
LIMITATION OF LIABILITY; INDEMNIFICATION
SECTION 8.1 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed
or omitted by such Indemnified Person in good faith and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Guarantee Agreement or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses, or any other facts pertinent to the existence
and amount of assets from which Distributions to Holders of Preferred
Securities might properly be paid.
SECTION 8.2 Indemnification.
(a) To the fullest extent permitted by applicable law, the
Guarantor shall indemnify and hold harmless each Indemnified Person from and
against any loss, damage or claim incurred by such Indemnified Person by
reason of any act or omission performed or omitted by such Indemnified Person
in good faith and in a manner such Indemnified Person reasonably believed to
be within the scope of authority conferred on such Indemnified Person by this
Guarantee Agreement, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such
Indemnified Person by reason of negligence or willful misconduct with respect
to such acts or omissions.
(b) To the fullest extent permitted by applicable law,
expenses (including legal fees) incurred by an Indemnified Person in defending
any claim, demand, action, suit or proceeding shall, from time to time, be
advanced by the Guarantor prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by the Guarantor of an
undertaking by or on behalf of the Indemnified Person to repay such amount if
it shall be determined that the Indemnified Person is not entitled to be
indemnified as authorized in Section 8.2(a).
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Guarantee
Agreement shall bind the successors, assignees, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding. Except in connection with a
consolidation, merger or sale involving the Guarantor that is permitted under
Article Ten of the Indenture, the Guarantor shall not assign its obligations
hereunder.
SECTION 9.2 Amendments.
Except with respect to any changes which do not adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Guarantee Agreement may only be amended with the prior
approval of the Holders of not less than 66-2/3% in liquidation amount of the
Preferred Securities. The provisions of Section 12.2 of the Declaration
concerning meetings of Holders shall apply to the giving of such approval.
SECTION 9.3 Notices.
Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below
or such other address as the Guarantor may give notice of to the Holders:
The AES Corporation
0000 Xxxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Facsimile No.:
Attention: General Counsel and Secretary
(b) if given to the Guarantee Trustee, to the address set
forth below or such other address as the Guarantee Trustee may give notice to
the Holders:
[to come]
(c) if given to any Holder of Preferred Securities, at the
address set forth on the books and records of the Issuer.
All notices hereunder shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first
class mail, postage prepaid except that if a notice or other document is
refused delivery or cannot be delivered because of a changed address of which
no notice was given, such notice or other document shall be deemed to have
been delivered on the date of such refusal or inability to deliver.
SECTION 9.4 Genders.
The masculine, feminine and neuter genders used herein shall
include the masculine, feminine and neuter genders.
SECTION 9.5 Benefit.
This Guarantee Agreement is solely for the benefit of the
Holders and subject to Section 3.1(a) is not separately transferable from the
Preferred Securities.
SECTION 9.6 Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAWS).
SECTION 9.7 Counterparts.
This Guarantee Agreement may be executed in counterparts, each
of which shall be an original; but such counterparts shall together constitute
one and the same instrument.
SECTION 9.8 Exercise of Overallotment Option.
If and to the extent that Preferred Securities are issued by
the Issuer upon exercise of the overallotment option referred to the second
WHEREAS clause, the Guarantor agrees to give prompt notice thereof to the
Guarantee Trustee but the failure to give such notice shall not relieve the
Guarantor of any of its obligations hereunder.
THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
The AES Corporation
By:____________________________
Name:
Title:
The First National Bank of Chicago
As Guarantee Trustee
By:________________________
Name:
Title:
STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
BEFORE ME, the undersigned authority, on this day of ________,
199_, personally appeared _______________ of The AES Corporation known to me
(or proved to me by introduction upon the oath of a person known to me) to be
the person and officer whose name is subscribed to the foregoing instrument,
and acknowledged to me that he/she executed the same as the act of such trust
for the purposes and consideration herein expressed and in the capacity
therein stated.
GIVEN UNDER MY HAND AND SEAL THIS ____ DAY OF __________, 199_.
[SEAL]
________________________________
NOTARY PUBLIC, STATE OF NEW YORK
Print Name:_____________________
Commission Expires:_____________
STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
BEFORE ME, the undersigned authority, on this day of ________,
199_, personally appeared _______________ of The First National Bank of
Chicago, known to me (or proved to me by introduction upon the oath of a
person known to me) to be the person and officer whose name is subscribed to
the foregoing instrument, and acknowledged to me that he/she executed the same
as the act of such trust for the purposes and consideration herein expressed
and int he capacity therein stated.
GIVEN UNDER MY HAND AND SEAL THIS ____ DAY OF __________, 199_.
[SEAL]
________________________________
NOTARY PUBLIC, STATE OF NEW YORK
Print Name:_____________________
Commission Expires:_____________
