EXHIBIT 10.20
EXECUTION COPY
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URC SECURITY AGREEMENT
by and between
AES Red Oak Urban Renewal Corporation
and
AES Red Oak, L.L.C.
Dated as of March 1, 2000
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS......................................................................2
Section 1.1 Definitions....................................................2
Section 1.2 References to Assignment.......................................7
ARTICLE II
ASSIGNMENT, SECURITY INTEREST; POWER OF ATTORNEY.................................8
Section 2.1 Pledge and Security Interest...................................8
Section 2.2 Power of Attorney..............................................8
ARTICLE III
REPRESENTATIONS AND WARRANTIES...................................................9
Section 3.1 Representations and Warranties of AES URC......................9
ARTICLE IV
COVENANTS AND SPECIAL PROVISIONS................................................10
Section 4.1 Maintenance of Records........................................10
Section 4.2 Payment under Contracts and Receivables.......................10
Section 4.3 Documents and Instruments.....................................10
Section 4.4 Consents......................................................10
ARTICLE V
COLLATERAL......................................................................11
Section 5.1 Protection of AES Red Oak's Interests.........................11
Section 5.2 Further Action................................................11
Section 5.3 Financing Statements..........................................11
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ARTICLE VI
REMEDIES UPON OCCURRENCE OF TRIGGER EVENT.......................................11
Section 6.1 Remedies......................................................11
Section 6.2 Disposition of the Collateral.................................12
Section 6.3 Waiver of Claims..............................................13
Section 6.4 Application of Proceeds.......................................14
Section 6.5 Remedies Cumulative...........................................14
Section 6.6 Discontinuance of Proceedings.................................14
ARTICLE VII
INDEMNITY.......................................................................15
Section 7.1 Indemnity.....................................................15
Section 7.2 Indemnity Obligations Secured by Collateral...................16
ARTICLE VIII
MISCELLANEOUS...................................................................16
Section 8.1 Notices.......................................................16
Section 8.2 Amendment.....................................................17
Section 8.3 No Waiver.....................................................17
Section 8.4 Obligations of AES URC........................................17
Section 8.5 Successors and Assigns........................................18
Section 8.6 Governing Law.................................................18
Section 8.7 Continuing Liability of AES URC...............................19
Section 8.8 [No] Third-Party Beneficiaries................................19
Section 8.9 Continuing Assignment and Security Interest...................19
Section 8.10 Headings......................................................19
Section 8.11 Severability..................................................19
Section 8.12 Counterparts..................................................19
Section 8.13 Limited-Recourse..............................................19
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URC SECURITY AGREEMENT
URC SECURITY AGREEMENT, dated as of March 1, 2000, by and between AES
RED OAK URBAN RENEWAL CORPORATION, a non-profit corporation organized and
validly existing under the laws of the State of New Jersey ("AES URC") and AES
RED OAK, L.L.C., a limited liability company organized and validly existing
under the laws of the State of Delaware ("AES RED OAK").
A. AES Red Oak is providing for the development, construction,
ownership, leasing and operation of a portion of a nominal 820 MW (net)
gas-fired combined cycle electric generating facility and related equipment and
facilities (the "PROJECT") to be located in the Borough of Sayreville, Middlesex
County, New Jersey.
B. AES Red Oak 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 AES Red Oak and The Bank of New York, a bank duly organized
and existing under the laws of the State of New York ("BNY"), as trustee (the
"TRUSTEE") and depositary bank, as it may be amended, supplemented or modified
and in effect from time to time (the "INDENTURE").
C. AES URC intends to finance the construction of a portion of the
Project through the borrowing from AES Red Oak of certain proceeds of the
Securities (the "LOAN") pursuant to a Loan Agreement, dated as of March 1, 2000
between AES URC and AES Red Oak, as it may be amended or supplemented from time
to time (the "URC LOAN AGREEMENT").
D. In connection with the commencement of commercial operation of the
Project, AES Red Oak is required to deliver the Debt Service Reserve Letter of
Credit (the "DSR LETTER OF CREDIT"). Dresdner Bank AG, acting through its New
York Branch ("DRESDNER"), as issuing bank, has agreed to issue the DSR Letter of
Credit subject to the terms and conditions contained in the DSR LOC
Reimbursement Agreement, dated as of March 1, 2000 (as amended, supplemented and
in effect from time to time, THE "DSR LOC REIMBURSEMENT Agreement"), among each
of the banks (including the issuing bank) and financial institutions parties
thereto (the "DSR LOC BANKS") and Dresdner, as issuing bank and as agent for
such banks (including the issuing bank) and financial institutions (in such
capacity as agent, and together with its successors and assigns, in such
capacity, the "DSR LOC PROVIDER").
E. In connection with AES Red Oak's obligations under Section 18.2 of
the Power Purchase Agreement, AES Red Oak intends to deliver the Power Purchase
Agreement Letter of Credit (the "PPA LOC"). Dresdner, as issuing bank, has
agreed to issue the PPA LOC subject to the terms and conditions contained in the
PPA LOC Reimbursement Agreement, dated as of March 1, 2000 (as amended,
supplemented or modified and in effect from time to time, the "PPA LOC
REIMBURSEMENT AGREEMENT"), among each of the banks (including the issuing bank)
and financial institutions parties thereto (the "PPA LOC BANKS") and Dresdner,
as issuing bank and as agent for such banks and financial institutions (in such
capacity as agent, and together with its successors and assigns, in such
capacity, the "PPA LOC PROVIDER").
F. AES Red Oak intends to finance certain working capital requirements
of the Project by entering into a Working Capital Agreement (as amended,
supplemented or modified and in effect from time to time, the "WORKING CAPITAL
AGREEMENT") among AES Red Oak, each of the banks and financial institutions
parties thereto (the "WORKING CAPITAL BANKS") and Dresdner, as agent bank
thereunder (together with its successors and assigns, in such capacity, the
"WORKING CAPITAL PROVIDER").
G. All obligations of AES Red Oak under the Securities, the DSR LOC
Reimbursement Agreement and related evidences of indebtedness, the PPA LOC
Reimbursement Agreement and related evidences of indebtedness, the Collateral
Agency Agreement (defined below), and the Working Capital Agreement and related
evidences of indebtedness (collectively, the "FINANCING DOCUMENTS") to the
Trustee, the DSR LOC Provider, the PPA LOC Provider, the Collateral Agent, the
Working Capital Provider, each successor to any such person and any person
providing Senior Debt to AES Red Oak who becomes a party to the Collateral
Agency Agreement in accordance with its terms (collectively, the "SENIOR
PARTIES") will be secured by a certain Mortgage, Security Agreement, the
Indenture and the Assignment of Leases and Income, each between AES Red Oak and
BNY as Collateral Agent.
H. The Collateral Agent, AES URC, AES Red Oak, the DSR LOC Provider,
the PPA LOC Provider, the Working Capital Provider and the Trustee entered into
the Collateral Agency and Intercreditor Agreement (as amended, supplemented 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.
I. It is a condition precedent to the obligations of the Senior Parties
under the Financing Documents that AES URC duly execute and deliver this
Agreement to further secure its obligations to AES Red Oak and AES Red Oak's
obligations under the Financing Documents and the other Obligations (as
hereinafter defined).
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, AES URC hereby agrees with AES Red Oak as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Except as otherwise provided herein, for the
purposes of this Agreement, capitalized terms used and not otherwise defined
herein shall have the meanings ascribed to such terms in the Indenture. Unless
otherwise stated, any reference herein to any document shall mean such document
and all schedules, exhibits, and attachments thereto as amended, supplemented or
modified in accordance with the terms of this Agreement or the Collateral Agency
Agreement and in effect from time to time and any reference herein to any Person
shall include its successors and permitted assigns. References to any law or
regulations
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shall be deemed references to such law or regulation or any successor law or
regulation as the same may have been or may be amended, modified or supplemented
from time to time. In addition, wherever used in this Agreement and unless the
context requires otherwise, the following terms shall have the following
meanings:
"ACCOUNT" and "ACCOUNTS" shall mean, individually and collectively, the
Construction Account, Revenue Account, Operating and Maintenance Account,
Restoration Account, Major Maintenance Reserve Account, Fuel Conversion Payment
Volume Rebate Account, Subordinated Debt Account, Distribution Account, DSR LOC
Reimbursement Fund, PPA LOC Reimbursement Fund, Bond Payment Account, Bond
Proceeds Account, Construction Interest Account and Debt Service Reserve
Account, as each such account (and each such subaccount thereof) is defined
under the Collateral Agency Agreement, and each other account established,
created or modified from time to time pursuant to the provisions of the
Indenture and the Collateral Agency Agreement.
"AGREEMENT" means this URC Security Agreement as originally executed
and as the same may from time to time be amended, modified or supplemented.
"ASSIGNED AGREEMENTS" means the following contracts:
(a) i. the Ground Lease Agreement;
ii. the Sublease Agreement;
iii. the Construction Agency Agreement;
iv. the Financial Agreement between the Borough of
Sayreville, Middlesex County, New Jersey and AES URC, dated
December 3, 1999;
(b) any contract with a third party assigned to AES URC;
and
(c) all Contracts (and Contract Rights), other than the
Contracts (and Contract Rights) specifically itemized in the foregoing
list of Assigned Agreements,
as each such Assigned Agreement identified in (a)-(c) above may be
amended, supplemented or otherwise modified from time to time in
accordance with the terms of this Agreement or the Collateral Agency
Agreement, including, without limitation, to the extent of AES URC's
rights in such Assigned Agreement, (i) all rights of AES URC to receive
moneys due and to become due under or pursuant to the Assigned
Agreements, (ii) all rights of AES URC to receive proceeds of any
insurance, indemnity, warranty or guaranty with respect to any Assigned
Agreement, (iii) all claims of AES URC for damages arising out of
default under any Assigned Agreement, (iv) the right of AES URC to
terminate, amend, supplement or modify any Assigned Agreement, to give
any waiver, consent or notice thereunder, to make any election
thereunder, to exercise and perform any option or purchase right
thereunder, to perform thereunder, and to compel performance and
otherwise exercise all remedies thereunder and (v) to the extent not
included in the foregoing, all proceeds of any and all of the
foregoing.
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"BANK ACCOUNT" means (i) a deposit, custody, or other account (whether,
in any case, time or demand or interest or non-interest bearing and whether
maintained at a branch or office located within or without the United States) of
AES URC or in which AES URC has any interest, (ii) all amounts from time to time
credited to such account, (iii) all cash, securities, instruments, documents,
Chattel Paper, general intangibles, accounts and other property from time to
time credited to such account or representing investments and reinvestments of
amounts from time to time credited to such account and (iv) all interest,
principal payments, dividends and other distributions payable on or with respect
to, and all proceeds of, (A) all property so credited or representing such
investments and reinvestments and (B) such account.
"CHATTEL PAPER" shall have the meaning assigned to that term under the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.
"COLLATERAL" means, in each case whether now or hereafter existing or
now owned or hereafter acquired by AES URC whether or not the same is now
contemplated, anticipated or foreseeable, xxxxxx or inchoate, tangible or
intangible, all of the rights, titles and interests of AES URC in and to the
following wherever the same may be located except to the extent that the
assignment of any of the following is prohibited under Applicable Law or that
under such law the assignment of such Collateral would create a significant risk
of termination or loss of such Collateral or AES URC's rights thereto or
therein:
(i) the Assigned Agreements;
(ii) to the extent permitted by Applicable Law, all
Governmental Approvals;
(iii) all Receivables;
(iv) proceeds of all insurance contracts;
(v) all (i) Accounts, except to the extent a valid and
perfected security interest in such assets is created by the Collateral
Agency Agreement and subject to the qualifications below, (ii) other
accounts (including all Bank Accounts), (iii) any funds held in any
escrow account established or created by the Contracts and (iv)
Casualty Proceeds and Eminent Domain Proceeds;
(vi) proceeds of any Permitted Investments;
(vii) all Information;
(viii) any guarantees, and, to the extent evidencing or
pertaining to other items of Collateral, all documents of title,
policies and certificates of insurance, surety bonds, securities,
Chattel Paper, other Documents or Instruments, including but not
limited to all insurance with respect to the Project, business
interruption, workers compensation and comprehensive automobile, bodily
injury, and property damage;
(ix) all General Intangibles including but not limited to
the name and goodwill of AES URC;
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(x) all claims (including the right to xxx or otherwise
recover on such claims) with respect to (i) the items referred to in
the definition of Collateral, (ii) warranties relating to any
Collateral, (iii) any breach of any Contract constituting Collateral
or any Assigned Agreement and (iv) rights against third parties for
(A) loss, destruction, requisition, confiscation, condemnation,
seizure, forfeiture or infringement of, or damage to, any
Collateral, (B) payments due or to become due under leases, rentals
and hires of any Collateral and (C) proceeds payable under or
unearned premiums with respect to policies of insurance relating to
any Collateral;
(xi) all Inventory;
(xii) all Machinery and Equipment;
(xiii) all books, manuals, records, charts, ledgercards,
files, correspondence, drawings, schematics, computer programs, tapes,
disks and related data processing software that at any time evidence or
contain information relating to any Collateral or are otherwise
necessary or helpful in the collection thereof, realization thereupon
or operation or maintenance of the Facility;
(xiv) all goods and other property, whether or not
delivered (i) the sale, lease or furnishing of which gives or purports
to give rise to any Receivables or (ii) securing any Receivables,
including all of AES URC's rights as an unpaid vendor or lienor,
including stoppage in transit, replevin and reclamation with respect to
such goods and other properties;
(xv) all documents of title, policies and certificate of
insurance, securities, Chattel Paper and other Documents or Instruments
evidencing or pertaining to any Collateral;
(xvi) any fixture and improvement to the Site including,
without limitation, the structures, buildings and chattels constituting
the Facility, and otherwise contemplated by the Contracts, except to
the extent a valid and perfected first priority security interest in
such assets has been created by the URC Mortgage;
(xvii) any other assets of AES URC except to the extent a
valid and perfected first priority security interest in such assets has
been created by the URC Mortgage;
(xviii) all products and proceeds (including cash) of all of
the foregoing Collateral;
provided, however, that, notwithstanding anything to the contrary herein or
hereto, (i) the Bond Payment Account, the Bond Proceeds Account, the
Construction Interest Account and the Debt Service Reserve Account (and each
Subaccount thereof) shall constitute Collateral absolutely and exclusively for
the benefit of the holders of Securities (and the Trustee on their behalf), (ii)
the DSR LOC Reimbursement Fund shall constitute Collateral absolutely and
exclusively for the benefit of the DSR LOC Provider and (iii) the PPA LOC
Reimbursement Fund shall constitute Collateral absolutely and exclusively for
the benefit of the PPA LOC Provider.
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"CONTRACT RIGHTS" means all rights of AES URC (including, without
limitation, all rights to payment) under each Contract, except to the extent
that a valid and perfected first priority security interest over such rights is
created by and contained within the URC Mortgage.
"CONTRACTS" means all contracts or agreements to which AES URC is or
becomes a party or under which AES URC is a beneficiary or has rights thereto.
"DOCUMENTS" shall have the meaning assigned to that term under the
Uniform Commercial Code as in effect on the date hereof in the State of New
York, and shall include, but not be limited to, any bills of lading, dock
warrants, dock receipts or warehouse receipts.
"GENERAL INTANGIBLES" means general intangibles as defined in the
Uniform Commercial Code in effect on the date hereof in the State of New York,
and shall include, but not be limited to, all trademarks, trademark
applications, trademark and service xxxx registrations (including, without
limitation, all renewals of trademark and servicemark registrations, and all
rights corresponding thereto throughout the world, but excluding any such
registration that would be rendered invalid, abandoned, void or unenforceable by
reason of its being included as part of the Collateral), tradenames, business
names, fictitious business names, company names, business identifiers, prints,
labels, trade styles and service marks (whether or not registered), trade dress,
including logos or designs, copyrights, patents, patent applications (including,
without limitation, the inventions and improvements described and claimed
therein together with the reissues, division, continuations, renewals,
extensions and continuations in-part thereof), goodwill of AES URC's business
symbolized by any of the foregoing, all inventions, processes, production
methods, proprietary information, know-how, trade secrets, license rights,
license agreements, permits, franchises and any rights to tax refunds.
"INDEMNITEE" means the Trustee, any co-Trustee or Successor Trustee,
the DSR LOC Provider, the DSR LOC Issuing Bank, the DSR LOC Banks, the PPA LOC
Provider, the PPA LOC Issuing Bank, the PPA LOC Banks, the Working Capital
Provider, the Working Capital Banks, the holders of Securities, the Collateral
Agent, AES Red Oak and their respective officers, directors, employees,
representatives and agents.
"INFORMATION" means all information, data, plans, blueprints, designs,
recorded knowledge, surveys, architectural, structural, mechanical and
engineering plans and specifications, studies, data, reports and drawings, test
reports, manuals, material standards, processing standards, performance
standards, catalogs, computer and automatic machinery software and programs, all
accounting information and all media in which or on which any information or
knowledge or data or records may be recorded or stored and all computer programs
used for the compilation or printout of such information, knowledge, records or
data, prepared by or on behalf of, or acquired by and on behalf of, AES URC
specifically for the acquisition, occupancy, use, operation, maintenance, repair
or restoration of the Facility or any part thereof.
"INSTRUMENT" shall have the meaning assigned that term under the
Uniform Commercial Code in effect on the date hereof in the State of New York,
and shall include, but not be limited to, any drafts, checks, certificates of
deposit, notes, shares, participation or transferable warrants.
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"INVENTORY" means (i) all inventory, including (A) all goods held for
sale or lease or to be furnished under the Assigned Agreements, (B) all work in
process and (C) all raw materials, other by-products and other materials, and
supplies of every nature and description used or that might be used or consumed
in AES URC's business and (ii) all documents evidencing and general intangibles
relating to any of the foregoing.
"MACHINERY AND EQUIPMENT" means (i) all machinery, equipment, spare
parts, tools, furniture, furnishings and instruments of conveyance, including
vessels and automotive vehicles, (ii) all other goods except goods that
constitute General Intangibles and (iii) all replacements and substitutions for,
and all accessions to, the foregoing, in each case wherever located and whether
or not the same constitutes a "fixture".
"OBLIGATIONS" means, collectively, all indebtedness, obligations and
Financing Liabilities for which AES Red Oak is liable to the Senior Parties
under or pursuant to any and all Financing Documents and for which AES URC is
liable to AES Red Oak under or pursuant to AES URC Loan Agreement, in each case
whether direct or indirect, primary or secondary, fixed or contingent, now or
hereafter arising out of or in relation to any such agreements.
"RECEIVABLES" means any and all rights to the payment of money or other
forms of consideration of any kind at any time now or hereafter owing or to be
owing to AES URC, including, without limitation, all of AES URC's rights to
payment for any goods or products sold or services performed, whether now in
existence or arising from time to time hereafter, including, without limitation,
accounts receivable, letters of credit and the right of AES URC to receive
payment thereunder, insurance proceeds, notes, drafts, Instruments, Documents,
acceptances, and all other debts, obligations, and liabilities in whatever form,
now or hereafter owing to AES URC from any other Person, and whether evidenced
by an account, note, contract, security agreement, Chattel Paper or other
evidence of indebtedness or security, together with (i) all security pledged,
assigned, hypothecated or granted to or held by AES URC to secure the foregoing,
(ii) all of AES URC's right, title and interest in and to any goods of AES URC,
the sale of which gave rise thereto, (iii) all guarantees (if any), endorsements
and indemnifications on, or of, any of the foregoing, (iv) all powers of
attorney for the execution of any evidence of indebtedness or security or other
writing in connection therewith, (v) all evidences of the filing of financing
statements and other statements and the registration of other instruments in
connection therewith and amendments thereto, notices to other creditors or
secured parties, and certificates from filing or other registration officers and
(vi) all other writings related in any way to the foregoing.
"UNIFORM COMMERCIAL CODE" means the Uniform Commercial Code in effect
in the State of New York.
Section 1.2 REFERENCES TO ASSIGNMENT. Any reference in this Agreement
to an assignment shall include, as the case may require, a sale, conveyance,
setting over or transfer whether conditional or unconditional and whether direct
or indirect.
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ARTICLE II
ASSIGNMENT, SECURITY INTEREST; POWER OF ATTORNEY
Section 2.1 PLEDGE AND SECURITY INTEREST. As security for the prompt
and complete payment and performance and observance when due of the Obligations,
AES URC hereby grants, pledges, assigns and transfers to AES Red Oak a
continuing lien on and a continuing security interest in, to and under the
Collateral, which shall at all times be (i) a valid and, upon the making of all
necessary filings or the taking of possession of all requisite items of
Collateral, to the extent perfectible in accordance with Applicable Law,
perfected lien and security interest, (subject only to Permitted Liens) and (ii)
enforceable against AES URC, and (upon the making of all necessary filings or
the taking of possession of all requisite items of Collateral to the extent
perfectible under Applicable Law) all third parties in accordance with the terms
hereof as security for the Obligations, and the Collateral shall not at any time
be subject to any lien (other than Permitted Liens) that is prior to, on a
parity with or junior to the lien and security interest created hereunder.
Section 2.2 POWER OF ATTORNEY. To the fullest extent permitted by
Applicable Law and until the Obligations are paid in full, AES URC hereby
irrevocably appoints AES Red Oak as its attorney-in-fact with right of
substitution, to act, upon the occurrence and during the continuance of a
Trigger Event, as AES URC's attorney-in-fact, with full authority in the place
and stead of AES URC and in the name of AES URC or otherwise, from time to time
in AES Red Oak's discretion, to take any action and to execute any and all
documents and instruments that AES Red Oak may deem necessary or advisable to
accomplish the purpose of this Agreement.
To the fullest extent permitted by Applicable Law, AES URC hereby
confirms and ratifies any and all actions and things performed or done by AES
Red Oak, or any of its representatives hereunder, as attorney-in-fact for AES
URC in each case pursuant to the powers granted hereunder and exercised in
accordance with this Agreement and in a manner not inconsistent with the
Collateral Agency Agreement. The powers conferred on AES Red Oak hereunder, and
the exercise by AES Red Oak of such powers, shall not impose any duty on AES Red
Oak to exercise any such powers.
This special power of attorney shall be deemed to be coupled with an
interest and cannot be revoked by AES URC until the Obligations have been fully
paid, performed and indefeasibly discharged. Upon the occurrence and during the
continuance of a Trigger Event, AES URC shall abstain from exercising any rights
under any of the Contracts or the Security Documents which shall be inconsistent
with the exercise of the rights and functions herein granted to AES Red Oak as
the attorney-in-fact, including abstaining from collecting, claiming and
receiving any moneys under the Assigned Agreements; PROVIDED, that nothing
herein shall prevent AES URC from undertaking AES URC's operations in the
ordinary course of business in accordance with the Security Documents and the
Contracts.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1 REPRESENTATIONS AND WARRANTIES OF AES URC. AES URC
represents and warrants, which representations and warranties shall survive
execution and delivery of this Agreement as follows:
(a) All filings, registrations and recordings necessary to
create, preserve, protect and (in the case of the security interest in the
Collateral, to the extent perfectible in accordance with Applicable Law) perfect
the security interest granted by AES URC to AES Red Oak hereby in respect of the
Collateral have been accomplished and such security interest constitutes a valid
and enforceable and (to the extent perfectible in accordance with Applicable
Law) perfected security interest in the Collateral superior and prior to the
rights of all other Persons and subject to no other Liens or assignments, in
each case other than Permitted Liens. AES URC hereby represents that it has not,
prior to the date of this Agreement, assigned or granted any other security
interest in the Collateral, respectively, to any other Person.
(b) AES URC is the owner of all Receivables and all of its
rights, title and interest in and to all Assigned Agreements, free from any Lien
or other right, title or interest of any Person, other than the Liens created
under this Agreement and other than Permitted Liens. AES URC is not in default
under or in breach of, and no Authorized Officer of AES URC knows of any default
by any other party under or breach by any other party of, any of the Contracts
that in either case could reasonably be expected to result in a Material Adverse
Effect.
(c) As to Collateral (other than Assigned Agreements and
Receivables), AES URC is or will become the sole owner of all such Collateral,
free from any Lien or other right, title or interest of any Person (other than
the Liens created under this Agreement and other than Permitted Liens).
(d) Except for approvals to transfer Governmental Approvals,
no other consent of any other Person and no Governmental Approval is required as
at the date of the execution and delivery of this Agreement (i) for the grant by
AES URC of its respective pledge, assignment, and security interest with respect
to the Collateral or for the execution, delivery or performance of this
Agreement by AES URC, (ii) for the pledge, assignment and security interest
granted by AES URC with respect to the Collateral or (iii) for the exercise by
AES Red Oak of the rights, remedies and powers provided for in this Agreement or
the remedies with respect to the Collateral pursuant to this Agreement, assuming
in the case of this clause (iii) that AES Red Oak has all requisite power and
authority to conduct its business generally.
(e) Except for financing statements filed or to be filed in
respect of the security interests granted by AES URC under or as permitted by
this Agreement to the best knowledge of AES URC after due inquiry, there is no
financing statement (or similar instrument) filed under the law of any
jurisdiction covering or purporting to cover any interest of any kind in the
Collateral.
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ARTICLE IV
COVENANTS AND SPECIAL PROVISIONS
Section 4.1 MAINTENANCE OF RECORDS. AES URC will keep and maintain, at
its own cost and expense, complete (in all material respects) records of the
Collateral (including the Information, any records to be prepared and maintained
under the Assigned Agreements, the Receivables and the Contracts), including,
but not limited to, the originals of all documentation, records of all payments
received, all credits granted thereon and all other dealings therewith, and AES
URC will make the same available to AES Red Oak, at AES URC's own cost and
expense, at all reasonable times upon demand. AES URC shall, at AES URC's own
cost and expense, deliver copies (or, if a Trigger Event has occurred and is
continuing, originals) of all Collateral (including the Assigned Agreements, the
Information, any writings evidencing the Receivables and the Contracts),
including documentation and relevant books and records, to AES Red Oak or to its
representatives at any time upon its demand.
Section 4.2 PAYMENT UNDER CONTRACTS AND RECEIVABLES. If AES URC
receives any payment or moneys directly from any party to the Assigned
Agreements, or from any account debtor or other obligor under any Receivable
constituting a part of the Collateral, AES URC shall receive such payments in a
constructive trust for the benefit of AES Red Oak and shall immediately transmit
and deliver such payment or moneys to AES Red Oak in the same form as received,
together with any necessary endorsement.
Section 4.3 DOCUMENTS AND INSTRUMENTS. If AES URC owns or acquires any
Document or Instrument, AES URC shall forthwith, but in any event no later than
10 days after such acquisition, as the case may be, deliver such Document or
Instrument to AES Red Oak, appropriately endorsed to the order of AES Red Oak as
further security under this Agreement.
Section 4.4 CONSENTS. AES URC shall use its commercially reasonable
efforts to obtain, at the expense of AES URC, after the date of the execution
and delivery of this Agreement, such other consents and Governmental Approvals
as may be necessary after the date of this Agreement, (i) for the grant by AES
URC of its pledge, assignment, and security interest granted hereby or for the
execution, delivery or performance of this Agreement by AES URC, (ii) for the
perfection (to the extent perfectible in accordance with Applicable Law) or
maintenance of the pledge, assignment, and security interest created hereby with
respect to the Collateral (including the first priority nature of such pledge,
assignment and security interest with respect to the Collateral) or (iii) for
the exercise by AES Red Oak of the rights, remedies and powers provided for in
this Agreement or the remedies with respect to the Collateral pursuant to this
Agreement.
ARTICLE V
COLLATERAL
Section 5.1 PROTECTION OF AES RED OAK'S INTERESTS. AES URC will not do
anything to impair the rights of AES Red Oak in the Collateral, PROVIDED THAT,
nothing herein shall prevent AES URC, prior to the exercise by AES Red Oak of
any such rights, from undertaking its
10
operations in the ordinary course of business as contemplated by the Project
Contracts, Security Documents and the Financing Documents. AES URC retains all
liability and responsibility in connection with the Collateral, and agrees that
its liability with respect to the Obligations shall in no way be affected or
diminished by reason of the fact that such Collateral may be lost, destroyed,
stolen, damaged or for any reason whatsoever unavailable to AES URC.
Section 5.2 FURTHER ACTION. AES URC will, at AES URC's own expense,
make, execute, endorse, acknowledge, file and deliver to AES Red Oak such lists,
descriptions and designations of the Collateral, warehouse receipts, receipts in
the nature of warehouse receipts, bills of lading, documents of title, vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, certificates, reports and other assurances or
instruments and take such further steps relating to the Collateral and other
property or rights covered by the interests hereby granted, which AES Red Oak
reasonably requests to perfect, preserve or protect its ownership and security
interests in the Collateral.
Section 5.3 FINANCING STATEMENTS. AES URC agrees to sign and file in
the appropriate jurisdictions such financing statements and continuation
statements (or similar statements or instruments of registration under the law
of any applicable jurisdiction) as are necessary to establish and maintain the
security interests contemplated hereunder as, to the extent stated herein,
valid, enforceable, first priority security interests and the other rights and
security contemplated herein, all in accordance with the Uniform Commercial
Code, or its equivalent, as enacted in any relevant jurisdictions or any other
relevant law. AES URC will pay any applicable filing fees and related expenses
in connection therewith. AES URC authorizes AES Red Oak to file any such
financing statements and any continuation statement or amendments thereto naming
AES URC as debtor with respect to its interest in the Collateral without the
signature of AES URC.
ARTICLE VI
REMEDIES UPON OCCURRENCE OF TRIGGER EVENT
Section 6.1 REMEDIES. If a Trigger Event under the Collateral Agency
Agreement shall have occurred and be continuing and, subject to any mandatory
requirements of Applicable Law then in effect, AES Red Oak, in addition to any
rights under Applicable Law, may exercise, without any further demand,
advertisement or notice (except as provided herein or otherwise required under
Applicable Law) all rights as a secured party under the Uniform Commercial Code,
or its equivalent, in any relevant jurisdiction and may, to the fullest extent
permitted and by law (and AES URC hereby waives all restrictions on exercise
that lawfully may be waived):
(a) personally, or by agents or attorneys, immediately retake
possession, physical or otherwise, of the Collateral or any part
thereof, from AES URC or any other Person who then has possession of
any part thereof with or without notice or process of law and, for that
purpose, may enter upon AES URC's premises where any of the Collateral
is located and remove the same, and use any and all services, supplies
and other facilities and materials of in connection with such removal;
11
(b) instruct the obligor under any agreement or instrument
evidencing or constituting Collateral to make any payment required by
the terms of such agreement or instrument directly to AES Red Oak;
(c) apply all amounts, securities, investments and other
property credited to the Accounts;
(d) sell, assign or otherwise liquidate, or direct AES URC to
sell, assign or otherwise liquidate, any or all of the Collateral, and
take possession of the proceeds of any such sale or liquidation to the
fullest extent permitted by Applicable Law;
(e) take possession of the Collateral or any part thereof, by
directing AES URC in writing to deliver the same to AES Red Oak at any
place designated by AES Red Oak, in which event AES URC shall, at its
own expense, forthwith cause the same to be moved and delivered to the
place so designated by AES Red Oak, it being understood that the
obligation of AES URC to deliver its interest in the Collateral is of
the essence of this Agreement and that AES Red Oak shall be entitled to
a decree requiring specific performance by AES URC, of such obligation;
and
(f) enforce any or all of the rights and remedies of AES URC
under the Assigned Agreements.
Section 6.2 DISPOSITION OF THE COLLATERAL. (a) Any Collateral
repossessed by AES Red Oak pursuant to and in accordance with Section 6.1 of
this Agreement, may be sold, assigned, leased or otherwise disposed of, in
general, in such manner, at such time, at such place and on such terms as AES
Red Oak may fix in the notice of sale described below. Any of the Collateral may
be sold, leased or otherwise disposed of in any commercially reasonable manner.
Any such disposition shall be by public or private sale upon not less than 10
days' written notice (which AES URC agrees is reasonable notification) to AES
URC specifying the time at which such disposition is to be made and the intended
sale or offering price or other consideration therefor, and shall be subject,
for the 10 days after the giving of such notice, to the right of AES URC to
acquire the Collateral at a price or for such other consideration at least equal
to the intended sale or offering price or other consideration so specified. To
the extent permitted by Applicable Law, AES Red Oak may bid for and become the
purchaser of the Collateral or any item thereof, offered for sale in accordance
with this Section 6.2. If, under mandatory requirements of Applicable Law, AES
Red Oak shall be required to make disposition of the Collateral within a period
of time which does not permit the giving of notice to AES URC as specified, then
AES Red Oak shall only be required to give AES URC such notice of disposition as
shall be reasonably practicable in view of such mandatory requirements of
Applicable Law. In lieu of exercising the power of sale hereunder, AES Red Oak
may proceed by a suit at law or in equity to foreclose the pledge and security
interest under this Agreement and sell the Collateral or any portion thereof
under a judgment or decree of a court or courts of competent jurisdiction.
(b) As used herein, the term "proceeds" includes all cash,
securities and other property received in respect of the Collateral, including
any cash, securities or other property received under any reorganization,
liquidation or adjustment of debt of AES URC, and any portion of the Collateral
or the products, profits or proceeds thereof which are distributed in kind.
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(c) AES Red Oak shall incur no liability as a result of the
manner of sale of the Collateral or any part thereof, at any private sale
conducted in a commercially reasonable manner and in good faith. AES URC hereby
waives, to the full extent permitted by Applicable Law, any claims against AES
Red Oak arising by reason of the fact that the price at which the Collateral or
any part thereof may have been sold at a private sale was less than the price
which might have been obtained at a public sale, or was less than the aggregate
amount of the Obligations, even if AES Red Oak accepts the first offer received
which AES Red Oak in good xxxxx xxxxx to be commercially reasonable under the
circumstances and does not offer the Collateral to more than one offeree.
Section 6.3 WAIVER OF CLAIMS. (a) Except as otherwise provided in this
Agreement, AES URC hereby waives, to the extent permitted by Applicable Law,
notice and judicial hearing in connection with AES Red Oak's taking possession
or AES Red Oak's disposition of any of the Collateral, including, without
limitation, any and all prior notice and hearing for any prejudgment remedy or
remedies and any such right which AES URC would otherwise have under the
constitution or any statute of the United States, state, or any political
subdivision of any such jurisdiction, and AES URC hereby further waives, to the
extent permitted by Applicable Law:
(i) all damages occasioned by such taking of possession except
any damages which are the direct result of the gross negligence or
willful misconduct of AES Red Oak or any Person acting on its behalf or
instruction;
(ii) all other requirements as to the time, place and terms of
sale or other requirements with respect to the enforcement of AES Red
Oak's rights hereunder; and
(iii) all rights of redemption, appraisal, valuation, stay,
extension or moratorium in force under any Applicable Law in order to
prevent or delay the enforcement of this Agreement or the absolute sale
of the Collateral or any portion thereof, and AES URC, for itself and
all who may claim under it, insofar as it or they now or hereafter
lawfully may, hereby waives the benefit of all such laws.
(b) Any sale of, or the grant of options to purchase, or any
other realization upon, any Collateral shall operate to divest all right, title,
interest, claim and demand, either at law or in equity, of AES URC therein, and
shall be a perpetual bar both at law and in equity against AES URC and against
any Persons claiming or attempting to claim the Collateral so sold, optioned or
realized upon, or any part thereof, through AES URC.
Section 6.4 APPLICATION OF PROCEEDS. (a) The proceeds in cash of any
Collateral obtained pursuant to Section 6.1 or disposed of pursuant to Section
6.2 shall be applied [in accordance with Section 4.1 of the Collateral Agency
Agreement].
(b) AES URC shall remain liable to the extent of any
deficiency between (i) the amount of the proceeds in cash of the Collateral
received and recovered by AES Red Oak and (ii) the aggregate amount of the
Obligations.
Section 6.5 REMEDIES CUMULATIVE. (a) No failure or delay on the part of
AES Red Oak in exercising any right, power or privilege hereunder and no course
of dealing between AES
13
URC, on the one hand, and AES Red Oak, on the other hand, shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
privilege under this Agreement, the URC Mortgage or the Collateral Agency
Agreement preclude any other exercise thereof or the exercise of any other
right, power or privilege hereunder. To the fullest extent permitted by law, but
subject to Section 8.13, the rights, powers and remedies herein, in the URC
Mortgage or in the Collateral Agency Agreement are cumulative and not exclusive
of any rights, powers or remedies which AES Red Oak would otherwise have. No
notice to or demand on AES URC shall entitle AES URC to any further notice or
demand in similar circumstances or constitute a waiver of the rights of AES Red
Oak to any other action in any circumstances without notice or demand.
(b) AES Red Oak is not required to take any discretionary
action under this Agreement and is entitled to receive indemnification to its
satisfaction before taking any action.
Section 6.6 DISCONTINUANCE OF PROCEEDINGS. In case AES Red Oak shall
have instituted any proceeding to enforce any right, power or remedy under this
Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall
have been discontinued or abandoned for any reason or shall have been determined
adversely to AES Red Oak, then AES URC and AES Red Oak shall be restored to
their former positions and rights under this Agreement with respect to the
Collateral subject to the security interests created under this Agreement, and
all rights, remedies and powers of AES Red Oak shall continue as if no such
proceeding had been instituted.
ARTICLE VII
INDEMNITY
Section 7.1 INDEMNITY. (a) AES URC shall indemnify, reimburse and hold
each Indemnitee harmless from and against any and all liabilities, obligations,
losses, damages, penalties, claims, actions, judgments, suits, costs, expenses
or disbursements of whatsoever kind or nature, including reasonable attorneys'
fees and expenses in connection therewith (herein referred to as "Expenses"),
which may be imposed on, asserted against or incurred by any of the Indemnitees
in any way arising out of their entering into, or the enforcement by AES Red Oak
(by itself or through one of more other Indemnitees) of its rights under, this
Agreement or the documents executed in connection herewith, or in any other way
connected with the performance or the administration of the transactions
contemplated hereby or thereby or the enforcement of any of the terms of or the
preservation of any rights, remedies and powers of AES Red Oak (or such other
Indemnitees) hereunder or thereunder, or in any way relating to or arising out
of the manufacture, ownership, ordering, purchase, delivery, control,
acceptance, lease, financing, possession, operation, condition, sale, return or
other disposition or use of the Collateral (including, without limitation,
latent or other defects, whether or not discoverable), the violation of the laws
of any country, state or other governmental body or unit, any tort (including,
without limitation, claims arising or imposed under the doctrine of strict
liability, or for or on account of injury to or the death of any Person
(including any Indemnitee), or for property damage, or negligence of any form)
or any contract claim arising from the transactions contemplated hereby or by
the Collateral Agency Agreement; PROVIDED, that no Indemnitee shall be
indemnified for Expenses to the extent caused by the gross negligence or willful
misconduct of such Indemnitee.
14
AES URC agrees that upon notice by any Indemnitee of any assertion that could
give rise to an Expense, AES URC shall assume full responsibility for the
defense thereof, and AES URC may assume such responsibility regardless of any
notice by AES Red Oak or an Indemnitee if AES URC shall unconditionally assume
such responsibility pursuant to an assumption agreement reasonably satisfactory
in form and substance to AES Red Oak (unless such Indemnitee shall decline to
permit such assumption); PROVIDED, that AES Red Oak shall retain the right, at
the expense of AES URC, to monitor any such assertion by engaging a single firm
of counsel of its choice, and PROVIDED, FURTHER, that AES URC shall obtain the
consent of AES Red Oak, which consent shall not be unreasonably withheld or
delayed, prior to the settlement of any such assertion. Each Indemnitee agrees
to notify AES URC promptly of any such assertion of which such Indemnitee has
knowledge; PROVIDED, that its failure to do so or delay in doing so shall not
impair its right to indemnification in accordance with this paragraph, except to
the extent such failure or delay shall materially impair the ability of AES URC
to defend such claim.
(b) Without limiting the application of Section 7.l(a), AES
URC agrees, promptly on demand, to pay or reimburse AES Red Oak for any fees,
costs and expenses of whatever kind or nature paid or incurred in connection
with the exercise of any of the rights, remedies or powers granted under this
Agreement, including without limitation the creation, preservation or protection
of AES Red Oak's rights to or AES Red Oak's Liens on, and security interest in,
the Collateral, including, without limitation, all fees and taxes in connection
with the recording or filing of instruments and documents in public offices,
payment or discharge of any taxes or Liens upon or in respect of the Collateral,
premiums for insurance with respect to the Collateral and all other fees, costs,
and expenses in connection with protecting, maintaining or preserving the
Collateral and AES Red Oak's interest therein, whether through judicial
proceedings or otherwise, or in defending or prosecuting any actions, suits or
proceedings arising out of or relating to the Collateral. From the date such
amounts shall have been paid by AES Red Oak or its agents, representatives,
successors and assigns until actually paid by AES URC.
(c) Without limiting the application of Section 7.1(a) or (b),
AES URC agrees to pay, indemnify and hold each Indemnitee harmless from and
against any Expenses which such Indemnitee may suffer, expend or incur in
consequence of or growing out of any misrepresentation by AES URC in this
Agreement or in any statement or writing made or delivered pursuant to or in
connection with this Agreement.
(d) If and to the extent that the obligations of AES URC under
this Section 7.1 are unenforceable for any reason, AES URC hereby agrees to make
the maximum contribution to the payment and satisfaction of such obligations
which is permissible under Applicable Law.
Section 7.2 INDEMNITY OBLIGATIONS SECURED BY COLLATERAL. (a) Any
amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral. The
indemnity obligations of AES URC contained in this Article VII shall continue in
full force and effect notwithstanding the full repayment of the Obligations or
the prior termination of this Agreement, the Collateral Agency Agreement or any
Project Contracts.
(b) AES Red Oak shall, as soon as practicable after any claim
for which it will seek indemnification hereunder is made against it, (i) provide
AES URC with reasonable detail
15
thereof, (ii) apprise AES URC of AES Red Oak's proposals to define or to settle
such claims and any development in relation thereto and (iii) to the extent
reasonably available, provide AES URC with an estimate as to the likely costs
(legal or otherwise) which AES Red Oak may have to incur in relation to such
claim.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 NOTICES. All notices required to be given under this
Agreement shall be in writing and shall be delivered personally (by hand
delivery or by overnight courier) or by facsimile transmission (with receipt of
transmission confirmation) or mailed (certified mail, postage prepaid) to the
Parties at the following addresses or facsimile numbers and shall be effective
upon receipt (when sent by personal delivery or by certified mail) and upon
receipt of transmission conformation (when sent by facsimile):
If to AES Red Oak, to:
AES Red Oak, L.L.C.
000 Xxxxxxxxxx Xxxx
Xxxxxx, XX 00000
Attention: Project Manager
Facsimile: 000-000-0000
If to AES URC, to:
AES Red Oak Urban Renewal Corporation
000 Xxxxxxxxxx Xxxx
Xxxxxx, XX 00000
Attention: Project Manager
Facsimile: 000-000-0000
Either Party from time to time may change its address, facsimile number or other
information for the purposes of notices to such Party by giving notice
specifying such change to the other Party.
Section 8.2 AMENDMENT. This Agreement may be changed, waived,
discharged, or terminated only by an instrument in writing and signed by AES Red
Oak and AES URC and any waiver shall be effective only in the specific instance
and for the specific purpose for which given.
Section 8.3 NO WAIVER. No failure on the part of AES Red Oak or any of
its agents to exercise, and no course of dealing with respect to, and no delay
in exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by AES Red Oak or any of its
agents of any right, power or remedy hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies herein are cumulative and are not exclusive of any remedies provided by
law.
Section 8.4 OBLIGATIONS OF AES URC. Notwithstanding anything to the
contrary contained in this Agreement, the obligations of AES URC specified in
this Agreement shall be
16
absolute and unconditional (except to the extent expressly provided otherwise)
and shall remain in full force and effect without regard to, and shall not be
released, suspended, discharged, terminated or otherwise affected by, any
circumstance or occurrence whatsoever (other than termination as provided in
Section 8.9), including, without limitation: (i) any renewal, extension,
amendment or modification of, or addition or supplement to or deletion from, the
Collateral Agency Agreement, any other Security Document, any Financing
Document, Project Contract or any other instrument or agreement referred to
therein, or any assignment or transfer of any thereof; (ii) any waiver, consent,
extension, indulgence or other action or inaction under or in respect of any
such instrument or agreement or this Agreement or any exercise or non-exercise
of any right, remedy, power or privilege under or in respect of this Agreement,
the Collateral Agency Agreement, any other Security Document, any Financing
Document or any Project Contract; (iii) any furnishing of any additional
security to AES Red Oak or the Collateral Agent or any acceptance thereof or any
sale, exchange, release, surrender or realization of or upon any security by AES
Red Oak or the Collateral Agent; or (iv) any invalidity, irregularity or
unenforceability of all or part of the Obligations or of any security therefor.
In the event of any inconsistency between this Agreement and the Collateral
Agency Agreement, the latter shall govern.
Section 8.5 SUCCESSORS AND ASSIGNS. Any corporation into which AES Red
Oak may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which AES
Red Oak shall be a party, or any corporation succeeding to all or substantially
all of the business of AES Red Oak, shall be the successor of AES Red Oak
hereunder, provided such corporation or bank shall be otherwise qualified and
eligible under this Section 8.5, without the execution or filing of any paper or
any further act on the part of any of the parties hereto. This Agreement shall
be binding upon and inure to the benefit of and be enforceable by the respective
successors and permitted assigns of the parties and shall inure to the benefit
of AES Red Oak; PROVIDED, that AES URC may not assign or transfer any of its
rights or obligations under this Agreement without the prior written consent of
AES Red Oak. AES Red Oak may assign its rights in connection with the exercise
of its rights and remedies under this Agreement. All agreements, statements,
representations and warranties made by AES URC herein or in any certificate or
other instrument delivered by AES URC or on its behalf under this Agreement
shall be considered to have been relied upon by AES Red Oak and shall survive
the execution and delivery of this Agreement, the Collateral Agency Agreement,
any other Financing Document or any Project Contract, regardless of any
investigation made by AES Red Oak or any other Person.
Section 8.6 GOVERNING LAW. (a) THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (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
Agreement and any action for enforcement of any judgment in respect thereof may
be brought in the courts of the State of New York or of the United States of
America for the Southern District of New York, and, by execution and delivery of
this Agreement, AES URC hereby accepts for itself and in respect of
17
its property, generally and unconditionally, the non-exclusive jurisdiction of
the aforesaid courts and appellate courts from any appeal thereof. AES URC
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, AES
URC, agrees to designate a new designee, appointee and agent in The City of New
York on the terms and for the purposes of this provision satisfactory to AES Red
Oak. AES URC 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, in accordance with
Section 8.1. AES URC hereby irrevocably waives any objection which it may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement brought in the
courts referred to above and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum. Nothing herein shall
affect the right of AES Red Oak to serve process in any other manner permitted
by law or to commence legal proceedings or otherwise proceed against AES URC in
any other jurisdiction.
Section 8.7 CONTINUING LIABILITY OF AES URC. Notwithstanding anything
to the contrary contained in this Agreement, AES URC shall remain liable to
perform all of the obligations binding upon it with respect to the Collateral to
the same extent as if this Agreement had not been executed. The exercise by AES
Red Oak of any of the rights hereunder shall not release AES URC from any of its
duties or obligations in respect of any of the Collateral except, to the extent
that such Collateral is foreclosed upon hereunder, in which event AES URC shall
be released only in respect of the obligations under or in respect of such
Collateral that arise after such foreclosure.
Section 8.8 [NO] THIRD-PARTY BENEFICIARIES. The agreements of the
parties hereto are solely for the benefit of AES URC, AES Red Oak, the
Indemnitees [the Collateral Agent and the Senior Parties], and no other Person
shall have any rights hereunder.
Section 8.9 CONTINUING ASSIGNMENT AND SECURITY INTEREST. This Agreement
shall create a continuing security interest in the Collateral and shall remain
in full force and effect until the payment in full of all of the Obligations. At
such time, the security interest granted and Liens and the assignment made
hereby shall terminate and all rights to the Collateral shall revert to AES URC.
Upon any such termination, AES Red Oak shall, at AES URC's expense, execute and
deliver to AES URC such documents as AES URC shall reasonably request to
evidence such termination.
Section 8.10 HEADINGS. Headings used in this Agreement are for
convenience of reference only and do not constitute part of this Agreement for
any purpose.
Section 8.11 SEVERABILITY. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(a) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of AES Red Oak in order
to carry out the intentions of the parties hereto as nearly as may be
18
possible and (b) the invalidity or unenforceability of any provision hereof in
any jurisdiction shall not affect the validity or enforceability of such
provision in any other jurisdiction.
Section 8.12 COUNTERPARTS. This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.
Section 8.13 LIMITED-RECOURSE. In the event of non-performance by AES
URC of the Obligations or its obligations under this Agreement, or any part
thereof, or for any claim based thereon or otherwise in respect thereof or
related thereto, no recourse shall be had to any Affiliate of AES URC or any
incorporators, officers, directors or employees thereof, and no judgment
relating to the obligations of AES URC under this Agreement, the Obligations, or
any part thereof, or for any claim based thereon or otherwise in respect thereof
or related thereto, shall be obtainable by AES Red Oak against any Members or
Affiliate of AES URC or any other incorporator, stockholder, officer, employee
or director past, present or future of AES URC; provided, however, that nothing
contained herein shall prevent the taking of any action permitted by law against
AES URC or any of its Affiliates, or in any way affect or impair the rights of
AES Red Oak to take any action permitted by law, in either case to realize upon
the Collateral and, provided further, that nothing herein shall be deemed to
affect the obligations of any Affiliate of AES URC under any Transaction
Document to which such Affiliate is a party.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
AES RED OAK URBAN RENEWAL
CORPORATION
By /s/ XXXXXXX X. XXXX
---------------------------------
Name: Xxxxxxx X. Xxxx
Title: Secretary
AES RED OAK, L.L.C.
By /s/ XXXXX X. XXXXXXXXX
---------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
20
