EXHIBIT 4.17
EXECUTION COPY
AES SAYREVILLE, L.L.C.
CONSENT TO ASSIGNMENT
THIS CONSENT TO ASSIGNMENT (this "CONSENT TO ASSIGNMENT") is entered
into as of March 1, 2000 by AES SAYREVILLE, L.L.C., a Delaware limited liability
company (the "CONSENTING PARTY"), and THE BANK OF NEW YORK, as collateral agent
(the "COLLATERAL AGENT", together with any successors thereto in such capacity,
referred to as the "ASSIGNEE"), for the benefit of and on behalf of the Senior
Parties defined below.
(A) AES Red Oak, L.L.C. (the "COMPANY"), a Delaware limited liability
company, is providing for the development, construction, ownership, leasing and
operation of a 764.3 (+/-10%) MW gas-fired combined cycle electric generating
facility (the "FACILITY") and the financing, development and construction
thereof (the Facility, equipment and facilities associated with the Facility and
such financing, development and construction, the "PROJECT") to be located in
the Borough of Sayreville, Middlesex County, New Jersey.
(B) The Company intends to finance the development and construction of
the Project, in part, through the issuance, from time to time, of certain
securities (the "SECURITIES") pursuant to a Trust Indenture, dated as of March
1, 2000 between the Company and The Bank of New York, as trustee (the
"TRUSTEE"), as it may be amended or supplemented from time to time (the
"INDENTURE").
(C) All obligations of the Company under the Securities, the Collateral
Agency Agreement (defined below) and any other agreements evidencing senior debt
of the Company (collectively, the "FINANCING DOCUMENTS") to the Trustee, the
Collateral Agent, each successor to any such person and each other person
providing senior debt to the Company who is or becomes a party to the Collateral
Agency Agreement pursuant to its terms (collectively, the "SENIOR PARTIES") will
be secured by a certain Mortgage, Security Agreement, Indenture, Pledge
Agreement and Assignment of Leases and Income, each between the Company and The
Bank of New York (collectively, the "SECURITY DOCUMENTS").
(D) The Senior Parties and the Company have entered into the Collateral
Agency and Intercreditor Agreement, dated as of March 1, 2000 (as amended,
supplemented or modified and in effect from time to time, the "COLLATERAL AGENCY
AGREEMENT") to set forth their mutual understanding with respect to (a) the
exercise of certain rights, remedies and options by the respective parties
thereto under the above described documents, (b) the priority of their
respective security interests created by the Security Documents, (c) the
application of project revenues and certain other monies and items and (d) the
appointment of the Collateral Agent as collateral agent.
(E) The Company and the Consenting Party have entered into that certain
Development and Operations Services Agreement (the "ASSIGNED AGREEMENT") dated
as of March 1, 2000 pursuant to which, among other things, the Consenting Party
will manage the development and
construction of the Project and, following the Commercial Operation Date,
operate and maintain the Project.
(F) The Company has notified the Consenting Party that all of the
Company's right, title and interest in the Assigned Agreement is to be assigned
to the Assignee as security pursuant to one or more of the Security Documents.
(G) It is a condition precedent to the extension of credit by the
Senior Parties that the Consenting Party execute and deliver this Consent to
Assignment for the benefit of the Senior Parties.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which hereby are acknowledged, the parties hereto agree as
follows:
1 DEFINITIONS. Capitalized terms used herein shall have the
respective meanings specified herein or, if not defined herein, as defined in
the Assigned Agreement.
2. CONSENT TO ASSIGNMENT. The Consenting Party hereby irrevocably
consents to the assignment of the Assigned Agreement by the Company to the
Assignee for the benefit of the Senior Parties as security. The Consenting Party
shall continue performance under the Assigned Agreement in accordance with its
terms and the terms of this Consent to Assignment and shall maintain the
Assigned Agreement in full force and effect. Until all obligations under the
Financing Documents have been performed and paid in full, all obligations of the
Consenting Party under the Assigned Agreement shall inure to the benefit of the
Assignee for the benefit of the Senior Parties to the same extent as if the
Assignee was an original party to the Assigned Agreement instead of the Company.
3. NO DEFAULTS. The Consenting Party acknowledges and agrees that (a)
the Assigned Agreement is in full force and effect and there are no amendments,
modifications or supplements thereto, either oral or written, (b) the Consenting
Party has not assigned, transferred or hypothecated the Assigned Agreement or
any interest therein, (c) the Consenting Party has no knowledge of any default
by the Company in any respect of the performance of any provision of the
Assigned Agreement and no knowledge of any event or condition which would either
immediately or with the passage of any applicable grace period or giving of
notice or both, enable the Consenting Party to terminate or suspend its
obligations under the Assigned Agreement, (d) none of the Company's rights under
the Assigned Agreement has been waived, (e) the assignment by the Company of the
Assigned Agreement to the Assignee, as security, and the acknowledgment of and
consent to such assignment by the Consenting Party, will not cause or constitute
a default under the Assigned Agreement or an event or condition which would,
with the giving of notice or lapse of time or both, constitute a default under
the Assigned Agreement, and (f) a foreclosure or other exercise of remedies
under any of the Security Documents or any sale thereunder by the Assignee, any
of the Senior Parties or any of their respective designees or assignees, whether
by judicial proceedings or under any power of sale contained therein, or any
conveyance from the Company to the Assignee, any of the Senior Parties or any of
their respective designees or assignees, in lieu thereof, shall not require the
consent of the Consenting Party or cause or
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constitute a default under the Assigned Agreement or an event or condition which
would, with the giving of notice or lapse of time or both, constitute a default
under the Assigned Agreement.
4. NOTICE OF COMPANY'S DEFAULTS AND TERMINATION. Anything in the
Assigned Agreement notwithstanding, for so long as any Financing Liabilities (as
defined in the Collateral Agency Agreement) are outstanding under the Financing
Documents and until the same have been satisfied in full, the Consenting Party
shall not claim prevention of or interference with performance of its
obligations under the Assigned Agreement, nor shall the Consenting Party
exercise any right it may have under the Assigned Agreement, at law or in
equity, to cancel, suspend or terminate the Assigned Agreement, or any of its
obligations thereunder, as the result of any default or other action or omission
(each, herein, a "default") of the Company unless the Consenting Party,
following expiry of all periods given the Company to cure such default, action
or omission, shall have given a copy of a notice of default to the Assignee,
such notice to be coupled with an opportunity to cure any such default within a
reasonable period, but in no event less than ninety (90) days from notice to the
Assignee (or, with respect to nonmonetary defaults or defaults the curing of
which requires the Assignee's possession of the Facility through foreclosure,
such longer period of time as may be necessary under the circumstances to
complete such foreclosure or cure such default, provided the Assignee, any of
the Senior Parties, or any of their respective designees or assignees is
diligently pursuing such cure or foreclosure), such cure period to commence upon
delivery of such notice to the Assignee, or, with respect to any defaults which
are not susceptible of being so corrected, to rectify to the Consenting Party's
reasonable satisfaction the effect upon the Consenting Party of such default by
the Company within such period provided, however, that if any such party is
prohibited from curing any such default by any process, stay or injunction
issued by any governmental authority or pursuant to any bankruptcy or insolvency
proceeding, then the time periods specified in this Section 4 for curing a
default shall be extended for the period of such prohibition. Such notice shall
be in writing and shall be deemed to have been given (a) when presented
personally, (b) one business day after being deposited for overnight delivery
with a nationally recognized overnight courier, such as FedEx, (c) when
received, if deposited in a regularly maintained receptacle for the United
States Postal Service, postage prepaid, registered or certified, return receipt
requested, addressed to the Assignee at the address indicated below or such
other address as the Assignee may have specified by written notice delivered in
accordance herewith, or (d) when transmitted by telecopy to the number specified
below and the receipt confirmed telephonically by recipient, PROVIDED that such
telecopy is then followed by a copy of such notice delivered by a method
specified in clause (a), (b) or (c) above.
The Bank of New York, as Collateral Agent
000 Xxxxxxx Xxxxxx
Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Facsimile: 000-000-0000
No cancellation, suspension or termination of the Assigned Agreement by
the Consenting Party, or of any of the Consenting Party's obligations thereunder
by the Consenting Party, shall be binding upon the Assignee or any of the Senior
Parties without such notice and the lapse of the
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applicable cure period. Any dispute that may arise under the Assigned Agreement
notwithstanding, the Consenting Party shall continue performance under the
Assigned Agreement and resolve any dispute without discontinuing such
performance until the lapse of the notice and applicable cure periods or
extension periods. The Assignee, any of the Senior Parties or any of their
respective designees or assignees may, but shall be under no obligation to, make
any payment or perform any act required thereunder to be made or performed by
the Company, with the same effect as if made or performed by the Company. If the
Assignee, any of the Senior Parties or any of their respective designees or
assignees fails to cure or rectify the effect of a default under the Assigned
Agreement or within ninety (90) days from notice to the Assignee (or, with
respect to nonmonetary defaults or defaults the curing of which requires the
curing party's possession of the Facility through foreclosure, such longer
period of time as may be necessary under the circumstances to complete such
foreclosure or cure such default, provided the Assignee, any of the Senior
Parties or any of their respective designees or assignees is diligently pursuing
such cure or such foreclosure), whichever is longer, such cure period to
commence upon such notice to the Assignee, the Consenting Party shall have all
its rights and remedies with respect to such default as set forth in the
Assigned Agreement.
5. NO PREVIOUS ASSIGNMENT. The Consenting Party represents and
warrants to the Assignee that it has not assigned, transferred or hypothecated,
nor previously consented to any assignment, transfer or hypothecation of, the
Assigned Agreement or any interest therein.
6. NO AMENDMENTS WITHOUT CONSENT. The Consenting Party shall not
amend, modify or consent to the amendment or modification of the Assigned
Agreement without the prior written consent of the Assignee, unless the Company
has certified to the Consenting Party in writing that such amendment,
modification or consent to amendment or modification is permitted under the
terms of the Financing Documents.
7. PAYMENTS TO REVENUE ACCOUNT. The Consenting Party hereby agrees
that, so long as any notes, bonds, loans, letters of credit, commitments or
other obligations, or any other Financing Liabilities, are outstanding under the
Financing Documents and until the same have been satisfied in full, all payments
to be made by the Consenting Party with respect to the Assigned Agreement shall
be in lawful money of the United States of America, in immediately available
funds. The Company hereby directs the Consenting Party to, and the Consenting
Party hereby agrees to, make all such payments with respect to the Assigned
Agreement directly to the Assignee at ABA No. 000000000, for credit to AES Red
Oak, L.L.C., for further credit to Account No. 002008 (Revenue Account)
Attention: Corporate Trust Administration, or to such other person and/or at
such other address as the Assignee may from time to time specify in writing to
the Consenting Party. All payments required to be made by the Consenting Party
under the Assigned Agreement shall be made without any offset, recoupment,
abatement, withholding, reduction or defense whatsoever, except as specifically
permitted under the Assigned Agreement.
8. PROTECTION OF ASSIGNEE. In the event that either (a) the Company's
interest in the Project shall be sold, assigned or otherwise transferred
pursuant to the exercise of any right, power or remedy by the Assignee or
pursuant to judicial proceedings, or (b) the Company rejects all or a portion of
the Assigned Agreement under Xxxxx 00, Xxxxxx Xxxxxx Code, or other similar
Federal or
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state statute and such rejection is approved by the appropriate bankruptcy court
or is otherwise effective pursuant to such statute, the Consenting Party shall,
promptly, and in no event longer than ten (10) days after receipt of written
request therefor, execute and deliver an agreement to the Assignee, any Senior
Parties or any of their respective nominees, purchasers, assignees or
transferees, as the case may be, for the remainder of the term of the Assigned
Agreement and with the same terms as are contained therein. References in this
Consent to Assignment to "Assigned Agreement" shall be deemed also to include
such new agreement.
9. ACKNOWLEDGEMENT OF ASSIGNEE'S OBLIGATIONS AND RIGHTS. Neither the
Assignee nor any of the Senior Parties has any obligation hereunder to extend
credit to the Consenting Party or any contractor of the Consenting Party at any
time for any purpose. The Assignee shall have no obligation to the Consenting
Party under the Assigned Agreement until such time as the Assignee notifies the
Consenting Party in writing of the Assignee's election to exercise its rights
hereunder. Upon the occurrence and during the continuance of an event of default
under any of the Security Documents, the Assignee or any of the Senior Parties
shall have the right to the extent authorized under the Security Documents, to
(a) take possession of the Project and operate the same, (b) sell or otherwise
transfer their interest in the Project and any purchaser at such sale which may
include the Assignee or its designees or assignees, shall have the right to
succeed to the Assignee's or the Senior Parties' rights hereunder ("Substitute
Owner"), as the case may be, and (c) exercise all rights of the Company under
the Assigned Agreement in accordance with the terms thereof. Subject to
compliance with the provisions of the Assigned Agreement (if applicable) and the
terms of this Consent to Assignment, the Consenting Party shall cooperate with
the Assignee and comply in all respects in the Assignee's exercise of such
rights. Without limiting the generality of the foregoing, upon the occurrence
and during the continuance of an event of default under any of the Financing
Documents, the Assignee, any of the Senior Parties or any of their respective
designees or assignees shall have the full right and power to enforce directly
against the Consenting Party all obligations of the Consenting Party under the
Assigned Agreement and otherwise to exercise all remedies thereunder, and to
make all demands and give all notices and make all requests required or
permitted to be made by the Company under the Assigned Agreement. The Assignee,
any of the Senior Parties or any of their respective designees or assignees
shall have the right, but not the obligation, to perform any act, duty or
obligation required of the Company thereunder at any time; provided that nothing
herein shall require the Assignee, any of the Senior Parties or any of their
respective designees or assignees to cure any default of the Company under the
Assigned Agreement or to perform any act, duty or obligation of the Company
under the Assigned Agreement except during any such period that it shall have
been a Substitute Owner and assumed such duties and obligations. The obligations
of any Substitute Owner shall be no more than that of the Company under such
Assigned Agreement, any Substitute Owner shall have no personal liability to the
Consenting Party for the performance of such obligations and the sole recourse
of the Consenting Party, if there is a Substitute Owner, shall be to Substitute
Owner's interest in the Facility. The Collateral Agent is not required to take
any discretionary action under this Agreement unless it receives written
direction from the Required Senior Parties. The Collateral Agent is entitled to
receive indemnification to its satisfaction before taking any action as directed
by the Required Senior Parties.
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10. REFINANCING. The Consenting Party hereby acknowledges that the
Company may from time to time obtain refinancing for the Project (including
privately or publicly placed bonds or notes), and the Consenting Party agrees
that it will promptly upon request execute in favor of the lenders providing
such refinancing a consent to assignment containing terms and conditions that
are no less favorable to the Consenting Party than those terms and conditions
contained in this Consent to Assignment.
11. REPRESENTATIONS. The Consenting Party represents and warrants to
the Assignee as follows:
(a) The Consenting Party is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is in good standing in all jurisdictions where necessary in light
of the business it conducts (including, without limitation, performance of its
obligations under the Assigned Agreement) and the properties it owns.
(b) The Consenting Party has the necessary power, authority and
legal right as a limited liability company to execute, deliver and perform its
obligations under the Assigned Agreement and this Consent to Assignment, and the
execution and delivery by the Consenting Party of the Assigned Agreement and
this Consent to Assignment and the performance of its obligations thereunder and
hereunder have been duly authorized by all necessary limited liability company
action and do not and will not (i) require any consent or approval of the
Consenting Party's board of directors or any shareholder or members of the
Consenting Party, (ii) violate any provision of the certificate of formation or
the limited liability company operating agreement of the Consenting Party or any
provision of any material law, rule or regulation, or any material order, writ,
judgment, injunction, decree, determination or award having applicability to the
Consenting Party, (iii) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other agreement, lease or
instrument to which the Consenting Party is a party or by which it or its
properties may be bound or affected or (iv) result in, or require, the creation
or imposition of any mortgage, deed of trust, pledge, lien, security interest,
charge or encumbrance of any nature upon or with respect to any of the
properties now owned or hereafter acquired by the Consenting Party; and the
Consenting Party is not in violation, breach or default of any provision of the
certificate of formation or the limited liability company operating agreement of
the Consenting Party or any provision of any material law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award having
applicability to the Consenting Party or any agreement referred to above in
clause (iii) of this subsection (b), which violation could have a material
adverse effect on the ability of the Consenting Party to perform its obligations
under this Consent to Assignment or the Assigned Agreement.
(c) The Assigned Agreement and this Consent to Assignment have
been duly executed and delivered and each constitutes a valid and binding
obligation of the Consenting Party, enforceable in accordance with their terms,
except to the extent that enforceability may be limited by applicable
bankruptcy, insolvency, moratorium, reorganization or other similar laws
affecting the enforcement of creditors' rights and general equitable principles.
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(d) No consent or approval of, or other action by, or any notice
or filing with, any court or administrative or governmental body (except those
previously obtained and in full force and effect) is required in connection with
the execution and delivery of the Assigned Agreement or this Consent to
Assignment or the performance by the Consenting Party of its obligations
thereunder or hereunder. The Consenting Party has obtained all permits,
licenses, approvals, consents, authorizations and exemptions, if any, with
respect to the performance of its obligations under the Assigned Agreement and
this Consent to Assignment required by applicable laws, statutes, rules and
regulations in effect as of the date hereof.
(e) The Consenting Party is not in default with respect to the
Assigned Agreement and has no knowledge, as of the date hereof, of any claims or
rights of set off by the Consenting Party or by any of its affiliates against
the Company. To the best of the Consenting Party's knowledge after due inquiry,
each other party to the Assigned Agreement have complied with all conditions
precedent to the respective obligations of such party to perform under the
Assigned Agreement.
(f) There are no proceedings pending or, to the best of the
Consenting Party's knowledge after due inquiry, threatened against or affecting
the Consenting Party in any court or before any governmental authority or
arbitration board or tribunal (whether or not purportedly on behalf of the
Consenting Party) which may result in a material or adverse effect upon the
property, business, prospects, profits or condition (financial or otherwise) of
the Consenting Party, or the ability of the Consenting Party to perform its
obligations under, or which purports to affect the legality, validity or
enforceability of, the Assigned Agreement or this Consent to Assignment; and the
Consenting Party is not in default with respect to any order of any court,
governmental authority or arbitration board or tribunal.
(g) All representations, warranties and other statements made by
the Consenting Party in the Assigned Agreement were true and correct as of the
date when made and are true and correct as of the date of this Consent to
Assignment.
12. BINDING UPON SUCCESSORS. All agreements, covenants, conditions and
provisions of this Consent to Assignment shall be binding upon and inure to the
benefit of the successors and assigns of each of the parties hereto.
13. CAPTIONS. The captions or headings at the beginning of each
Section hereof are for the convenience of the parties hereto only and are not a
part of this Consent to Assignment.
14. GOVERNING LAW. (a) THIS CONSENT TO ASSIGNMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE
PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW EXCEPT SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW).
(b) Any legal action or proceeding with respect to this Consent
to Assignment and any action for enforcement of any judgment in respect thereof
may be brought in the courts of
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the State of New York or of the United States of America for the Southern
District of New York, and, by execution and delivery of this Consent to
Assignment, each of the Consenting Party and the Assignee hereby accepts for
itself and in respect of its property, generally and unconditionally, the
non-exclusive jurisdiction of the aforesaid courts and appellate courts from any
appeal thereof. Each of the Consenting Party and the Assignee hereby irrevocably
designates, appoints and empowers CT Corporation System, 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx, 00000, as its designee, appointee and agent to receive, accept
and acknowledge for and on its behalf, and in respect of its property, service
of any and all legal process, summons, notices and documents which may be served
in any action or proceeding. If for any reason such designee, appointee and
agent shall cease to be available to act as such, the Assignee or the Consenting
Party, as applicable, agrees to designate a new designee, appointee and agent in
New York City on the terms and for the purposes of this provision satisfactory
to the Assignee. Each of the Consenting Party and the Assignee irrevocably
consents to the service of process out of any of the aforementioned courts in
any such action or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to the Consenting Party at its notice address
being 0000 Xxxxx 00xx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxxxx
Xxxxxx, Vice President and to the Assignee at the address set forth in Section
4. Each of the Consenting Party and the Assignee hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue of any of
the aforesaid actions or proceedings arising out of or in connection with this
Consent to Assignment brought in the courts referred to above and hereby further
irrevocably waives and agrees not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought in an
inconvenient forum. Nothing herein shall affect the right of the Assignee or any
of their respective designees or assignees to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
the Consenting Party in any other jurisdiction.
15. AMENDMENT. This Consent to Assignment may be modified,
amended or rescinded only by a writing expressly referring to this Consent to
Assignment and signed by both the Consenting Party and the Assignee. The
Assignee may request the direction of the Senior Parties prior to signing any
amendments described herein.
16. SEVERABILITY. Every provision of this Consent to Assignment
is intended to be severable. If any term or provision hereof is declared by a
court of competent jurisdiction to be illegal, invalid or unenforceable for any
reason whatsoever, such illegality, invalidity or unenforceability shall not
affect the other terms and provisions hereof, which terms and provisions shall
remain binding and enforceable, and to the extent possible all of such other
provisions shall remain in full force and effect.
17. COUNTERPARTS. This Consent to Assignment may be executed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
18. AUTHORITY TO TAKE SPECIFIC ACTIONS. Notwithstanding any
provision of this Consent to Assignment to the contrary, if an action by the
Assignee is authorized by the Assigned Agreement or by this Consent to
Assignment, the Consenting Party shall be obligated to recognize
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or follow instructions given by a Senior Party or any of its respective
designees or assignees, or any successor or assign of the Assignee or any Senior
Party, only if such person has provided to the Consenting Party reasonable
written documentation of its authority by or on behalf of the Assignee to
undertake the action which it is requesting or directing, and a written
certification to the Consenting Party that it is so authorized to act.
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IN WITNESS WHEREOF, each of the Consenting Party and the Assignee has
duly executed this Consent to Assignment as of the date first above written.
AES SAYREVILLE, L.L.C.
By: /s/ Xxxxxxx Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
THE BANK OF NEW YORK,
as COLLATERAL AGENT
By: /s/ XxxxXxxx Xxxxxxx
--------------------------------
Name: XxxxXxxx Xxxxxxx
Title: Vice President
REVIEWED AND CONSENTED TO:
AES RED OAK, L.L.C.
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Vice President
