EXHIBIT 4.12.2
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FORM OF
PREFERRED SECURITIES GUARANTEE AGREEMENT
DYNEGY INC.
Dated as of ______, ___
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation.................................. 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application................................ 5
SECTION 2.2 Lists of Holders of Securities.................................. 6
SECTION 2.3 Reports by the Preferred Securities Guarantee Trustee........... 6
SECTION 2.4 Periodic Reports to Preferred Securities Guarantee Trustee...... 6
SECTION 2.5 Evidence of Compliance with Conditions Precedent................ 7
SECTION 2.6 Events of Default; Waiver....................................... 7
SECTION 2.7 Event of Default; Notice........................................ 7
SECTION 2.8 Conflicting Interests........................................... 7
SECTION 2.9 Preferred Securities Guarantee Trustee May File Proofs of Claim. 8
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Securities Guarantee Trustee. 8
SECTION 3.2 Certain Rights of Preferred Securities Guarantee Trustee........ 10
SECTION 3.3 Not Responsible for Recitals or Issuance of Preferred
Securities Guarantee........................................ 12
ARTICLE IV
PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Preferred Securities Guarantee Trustee; Eligibility............. 12
SECTION 4.2 Appointment, Removal and Resignation of Preferred
Securities Guarantee Trustee................................ 13
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee....................................................... 13
SECTION 5.2 Waiver of Notice and Demand..................................... 14
SECTION 5.3 Obligations Not Affected........................................ 14
SECTION 5.4 Rights of Holders............................................... 15
Page
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SECTION 5.5 Guarantee of Payment............................................ 15
SECTION 5.6 Subrogation..................................................... 15
SECTION 5.7 Independent Obligations......................................... 16
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions...................................... 16
SECTION 6.2 Ranking......................................................... 17
ARTICLE VII
TERMINATION
SECTION 7.1 Termination..................................................... 17
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation..................................................... 18
SECTION 8.2 Indemnification................................................. 18
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.......................................... 18
SECTION 9.2 Amendments...................................................... 19
SECTION 9.3 Notices......................................................... 19
SECTION 9.4 Benefit......................................................... 20
SECTION 9.5 GOVERNING LAW................................................... 20
SECTION 9.6 Limited Liability............................................... 20
ii
PREFERRED
SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee"),
dated as of ______, ___, is executed and delivered by Dynegy Inc., a Delaware
corporation (the "Guarantor"), and The First National Bank of Chicago, a
national banking association as trustee (the "Preferred Securities Guarantee
Trustee"), for the benefit of the Holders (as defined herein) from time to time
of the Preferred Securities (as defined herein) of Dynegy Capital Trust II, a
Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to the Declaration (as defined herein) the Issuer is
issuing on the date hereof $______ aggregate liquidation amount of its ____%
Preferred Securities (collectively the "Preferred Securities") liquidation
amount $1,000 per Preferred Security.
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Preferred Securities Guarantee, to pay to the
Holders the Guarantee Payments (as defined below) and to make certain other
payments on the terms and conditions set forth herein.
WHEREAS, the Guarantor is executing and delivering a guarantee
agreement (the "Common Securities Guarantee"), with substantially identical
terms to this Preferred Securities Guarantee, for the benefit of the holders of
the Common Securities (as defined herein), except that if an Event of Default
(as defined in the Declaration) has occurred and is continuing, the rights of
holders of the Common Securities to receive Guarantee Payments under the Common
Securities Guarantee are subordinated, to the extent and in the manner set forth
in the Common Securities Guarantee, to the rights of holders of Preferred
Securities to receive Guarantee Payments under this Preferred Securities
Guarantee.
NOW, THEREFORE, in consideration of the purchase by each Holder, which
purchase the Guarantor hereby acknowledges shall benefit the Guarantor, the
Guarantor executes and delivers this Preferred Securities Guarantee for the
benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
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In this Preferred Securities Guarantee, unless the context otherwise
requires:
(a) capitalized terms used in this Preferred Securities Guarantee but
not defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) terms defined in the Declaration as at the date of execution of
this Preferred Securities Guarantee have the same meaning when
used in this Preferred Securities Guarantee unless otherwise
defined in this Preferred Securities Guarantee;
(c) a term defined anywhere in this Preferred Securities Guarantee
has the same meaning throughout;
(d) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities
Guarantee as modified, supplemented or amended from time to time;
(e) all references in this Preferred Securities Guarantee to Articles
and Sections are to Articles and Sections of this Preferred
Securities Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the same meaning
when used in this Preferred Securities Guarantee, unless otherwise
defined in this Preferred Securities Guarantee or unless the
context otherwise requires; and
(g) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405
under the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" means any day other than a Saturday or a Sunday, or a
day on which banking institutions in Chicago, Illinois or Houston, Texas are
authorized or required by law or executive order to close.
"Preferred Securities Guarantee Trustee" means The First National
Bank of Chicago, a national banking association, until a Successor Preferred
Securities Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Preferred Securities Guarantee and
thereafter means each such Successor Preferred Securities Guarantee Trustee.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Preferred Securities
Guarantee Trustee at which the corporate trust business of the Preferred
Securities Guarantee Trustee shall, at any particular time, be principally
administered, which office at the date of execution of this Agreement is located
at Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
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"Debentures" means the series of subordinated debt securities of the
Guarantor designated the ____ 8.316% Subordinated Deferrable Interest Debentures
due _____, ___, held by the Property Trustee (as defined in the Declaration) of
the Issuer.
"Declaration" means the Amended and Restated Declaration of Trust,
dated as of ______, ___, as amended, modified or supplemented from time to time,
among the trustees of the Issuer named therein, the Guarantor, as sponsor, and
the holders from time to time of undivided beneficial ownership interests in the
assets of the Issuer.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Preferred Securities Guarantee,
provided, however, that with respect to a default other than a default in
payment of any Guarantee Payment, the Guarantor shall have received notice of
such default and shall not have cured such default within 60 days after receipt
of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent
not paid or made by the Issuer: (i) any accumulated and unpaid Distributions (as
defined in the Declaration) that are required to be paid on such Preferred
Securities to the extent the Issuer has funds on hand legally available therefor
at such time, (ii) the redemption price, including all accumulated and unpaid
Distributions to the date of redemption (the "Redemption Price") to the extent
the Issuer has funds on hand legally available therefor at such time, with
respect to any Preferred Securities called for redemption by the Issuer, and
(iii) upon a voluntary or involuntary dissolution, winding-up or liquidation of
the Issuer (other than in connection with the distribution of Debentures to the
Holders in exchange for Preferred Securities as provided in the Declaration),
the lesser of (a) the aggregate of the liquidation amount and all accumulated
and unpaid Distributions on the Preferred Securities to the date of payment, to
the extent the Issuer has funds on hand legally available therefor, and (b) the
amount of assets of the Issuer remaining available for distribution to Holders
in liquidation of the Issuer after satisfaction of liabilities to creditors of
the Issuer as required by applicable law. If an Event of Default has occurred
and is continuing, no Guarantee Payments under the Common Securities Guarantee
with respect to the Common Securities or any guarantee payment under any Other
Common Securities Guarantees shall be made until the Holders shall be paid in
full the Guarantee Payments to which they are entitled under this Preferred
Securities Guarantee.
"Holder" shall mean any holder, as registered on the books and records
of the Issuer, of any Preferred Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Person known to a Responsible Officer of
the Preferred Securities Guarantee Trustee to be an Affiliate of the Guarantor
and provided further, that in determining whether the Holders of the requisite
liquidation amount of Preferred Securities have voted on any matter provided for
in the Guarantee, then for the purpose of such determination only (and not for
any other purposes hereunder), if the Preferred Securities remain in the form
of one or more Global Certificates (as defined in the Declaration), the term
"Holders"
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shall mean the holder of the Global Certificate acting at the direction of the
Preferred Security Beneficial Owners (as defined in the Declaration).
"Indemnified Person" means the Preferred Securities Guarantee
Trustee, any Affiliate of the Preferred Securities Guarantee Trustee, or any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Preferred Securities
Guarantee Trustee.
"Indenture" means the Indenture dated as of _______, ___, among the
Guarantor (the "Debenture Issuer") and The First National Bank of Chicago, as
trustee (the "Indenture Trustee"), and any indenture supplemental thereto,
pursuant to which the Debentures are to be issued to the Property Trustee (as
defined in the Declaration) of the Issuer.
"Indenture Event of Default" shall mean any event specified in Section
5.01 of the Indenture.
"Majority in liquidation amount of the Preferred Securities" means,
except as provided by the Declaration or by the Trust Indenture Act, a vote by
Holder(s) of more than 50% of the aggregate liquidation amount of all
outstanding Preferred Securities voting separately as a class. In determining
whether the Holders of the requisite amount of the Preferred Securities have
voted, Preferred Securities which are owned by the Guarantor or any Affiliate
of the Guarantor shall be disregarded for the purpose of any such determination
period.
"Officers' Certificate" means, with respect to the Guarantor, a
certificate signed by any of the Chairman of the Board, a Vice Chairman of the
Board, the Chief Executive Officer, the President or a Vice President and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Guarantor. Any Officers' Certificate delivered with respect to compliance
with a condition or covenant provided for in this Preferred Securities
Guarantee (other than pursuant to Section 314(d)(4) of the Trust Indenture Act)
shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer on behalf of such Person in
rendering the Officers' Certificates.
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
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"Other Common Securities Guarantees" shall have the same meaning as
"Other Guarantees" as defined in the Common Securities Guarantee.
"Other Debentures" means all junior subordinated debentures issued by
the Guarantor from time to time and sold to trusts to be established by the
Guarantor (if any), in each case similar to the Issuer.
"Other Guarantees" means all guarantees to be issued by the Guarantor
with respect to capital securities (if any) similar to the Preferred Securities
issued by other trusts to be established by the Guarantor (if any), in each case
similar to the Issuer.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" means, with respect to the Preferred Securities
Guarantee Trustee, any officer within the Corporate Trust Office of the
Preferred Securities Guarantee Trustee with direct responsibility for the
administration of this Preferred Securities Guarantee and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Successor Preferred Securities Guarantee Trustee" means a successor
Preferred Securities Guarantee Trustee possessing the qualifications to act as
Preferred Securities Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Trust Securities" means the Common Securities and the Preferred
Securities, collectively.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Preferred Securities Guarantee is subject to the provisions
of the Trust Indenture Act that are required to be part of this Preferred
Securities Guarantee and shall, to the extent applicable, be governed by such
provisions; and
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(b) if and to the extent that any provision of this Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
SECTION 2.2 Lists of Holders of Securities
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(a) The Guarantor shall provide the Preferred Securities Guarantee
Trustee (unless the Preferred Securities Guarantee Trustee is otherwise the
registrar of the Preferred Securities) with a list, in such form as the
Preferred Securities Guarantee Trustee may reasonably require, of the names and
addresses of the Holders ("List of Holders") as of such date, (i) within one
Business Day after May 15 and November 15 of each year, and (ii) at any other
time within 30 days of receipt by the Guarantor of a written request for a List
of Holders as of a date no more than 14 days before such List of Holders is
given to the Preferred Securities Guarantee Trustee, provided, that the
Guarantor shall not be obligated to provide such List of Holders at any time
that the Guarantor certifies in writing to the Preferred Securities Guarantee
Trustee that the List of Holders does not differ from the most recent List of
Holders given to the Preferred Securities Guarantee Trustee by the Guarantor.
The Preferred Securities Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Preferred Securities Guarantee Trustee shall comply with its
obligations under Sections 311(a), 311(b) and Section 312(b) of the Trust
Indenture Act.
SECTION 2.3 Reports by the Preferred Securities Guarantee Trustee
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Within 60 days after May 15 of each year, commencing May 15, 1998, the
Preferred Securities Guarantee Trustee shall provide to the Holders such reports
as are required by Section 313 of the Trust Indenture Act, if any, in the form
and in the manner provided by Section 313 of the Trust Indenture Act. The
Preferred Securities Guarantee Trustee shall also comply with the other
requirements of Section 313 of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Preferred Securities Guarantee Trustee
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The Guarantor shall provide to the Preferred Securities Guarantee
Trustee such documents, reports and information as required by Section 314 (if
any) and the compliance certificate required by Section 314 of the Trust
Indenture Act in the form, in the manner and at the times required by Section
314 of the Trust Indenture Act; provided that such compliance certificate shall
be delivered on or before 120 days after the end of each fiscal year of the
Guarantor. Delivery of such reports, information and documents to the Preferred
Securities Guarantee Trustee is for informational purposes only and the
Preferred Securities Guarantee Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Guarantor's compliance with any of
its covenants hereunder (as to which the Preferred Securities Guarantee Trustee
is entitled to rely exclusively on Officers' Certificates).
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SECTION 2.5 Evidence of Compliance with Conditions Precedent
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The Guarantor shall provide to the Preferred Securities Guarantee
Trustee such evidence of compliance with any conditions precedent, if any,
provided for in this Preferred Securities Guarantee that relate to any of the
matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate
or opinion required to be given by an officer pursuant to Section 314(c)(1) may
be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
-------------------------
The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of all Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Preferred Securities Guarantee, but
no such waiver shall extend to any subsequent or other default or Event of
Default or impair any right consequent thereon.
SECTION 2.7 Event of Default; Notice
------------------------
(a) The Preferred Securities Guarantee Trustee shall, within 90 days
after the occurrence of an Event of Default with respect to this Preferred
Securities Guarantee actually known to a Responsible Officer, mail by first
class postage prepaid, to all Holders, notices of all such Events of Default,
unless such defaults have been cured before the giving of such notice, provided,
that, except in the case of default in the payment of any Guarantee Payment, the
Preferred Securities Guarantee Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee, or a
trust committee of directors and/or a Responsible Officer in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Preferred Securities Guarantee Trustee shall not be deemed to
have knowledge of any Event of Default unless the Preferred Securities
Guarantee Trustee shall have received written notice from the Guarantor, or a
Responsible Officer charged with the administration of this Preferred
Securities Guarantee shall have obtained actual knowledge, of such Event of
Default.
SECTION 2.8 Conflicting Interests
---------------------
The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
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SECTION 2.9 Preferred Securities Guarantee Trustee May File Proofs of Claim
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Upon the occurrence of an Event of Default, the Preferred Securities
Guarantee Trustee is hereby authorized to (a) recover judgment, in its own name
and as trustee of an express trust, against the Guarantor for the whole amount
of any Guarantee, payments remaining unpaid and (b) file such proofs of claim
and other papers or documents as may be necessary or advisable in order to have
its claims and those of the Holders of the Preferred Securities allowed in any
judicial procedures relative to the Guarantor, its creditors or its property.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Securities Guarantee Trustee
---------------------------------------------------------------
(a) This Preferred Securities Guarantee shall be held by the
Preferred Securities Guarantee Trustee for the benefit of the Holders, and the
Preferred Securities Guarantee Trustee shall not transfer this Preferred
Securities Guarantee to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(b) or to a Successor Preferred Securities Guarantee
Trustee on acceptance by such Successor Preferred Securities Guarantee Trustee
of its appointment to act as Successor Preferred Securities Guarantee Trustee.
The right, title and interest of the Preferred Securities Guarantee Trustee
shall automatically vest in any Successor Preferred Securities Guarantee
Trustee, and such vesting and succession of title shall be effective whether or
not conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Preferred Securities Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer has
occurred and is continuing, the Preferred Securities Guarantee Trustee shall
enforce this Preferred Securities Guarantee for the benefit of the Holders.
(c) The Preferred Securities Guarantee Trustee, before the occurrence
of any Event of Default and after the curing of all Events of Default that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Preferred Securities Guarantee, and no implied covenants
shall be read into this Preferred Securities Guarantee against the Preferred
Securities Guarantee Trustee. In case an Event of Default has occurred (that
has not been cured or waived pursuant to Section 2.6) and is actually known to a
Responsible Officer, the Preferred Securities Guarantee Trustee shall exercise
such of the rights and powers vested in it by this Preferred Securities
Guarantee, and use the same degree of care and skill in its exercise thereof, as
a prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
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(d) No provision of this Preferred Securities Guarantee shall be
construed to relieve the Preferred Securities Guarantee Trustee from liability
for its own negligent action, its own negligent failure to act, or its own
willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Preferred Securities
Guarantee Trustee shall be determined solely by the express provisions
of this Preferred Securities Guarantee, and the Preferred Securities
Guarantee Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Preferred Securities Guarantee, and no implied covenants or
obligations shall be read into this Preferred Securities Guarantee
against the Preferred Securities Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Preferred
Securities Guarantee Trustee, the Preferred Securities Guarantee
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Preferred Securities
Guarantee Trustee and conforming to the requirements of this Preferred
Securities Guarantee; but in the case of any such certificates or
opinions that by any provision hereof are specifically required to be
furnished to the Preferred Securities Guarantee Trustee, the
Preferred Securities Guarantee Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Preferred Securities Guarantee;
(ii) the Preferred Securities Guarantee Trustee shall not be liable
for any error of judgment made in good faith by a Responsible Officer,
unless it shall be proved that the Preferred Securities Guarantee Trustee
was negligent in ascertaining the pertinent facts upon which such judgment
was made;
(iii) the Preferred Securities Guarantee Trustee shall not be liable
with respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holders of a Majority in
liquidation amount of the Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy available to
the Preferred Securities Guarantee Trustee, or exercising any trust or
power conferred upon the Preferred Securities Guarantee Trustee under this
Preferred Securities Guarantee; and
(iv) no provision of this Preferred Securities Guarantee shall
require the Preferred Securities Guarantee Trustee to expend or risk its
own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers, if the Preferred Securities Guarantee Trustee shall have
reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under
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the terms of this Preferred Securities Guarantee or indemnity, reasonably
satisfactory to the Preferred Securities Guarantee Trustee, against such
risk or liability is not reasonably assured to it.
SECTION 3.2 Certain Rights of Preferred Securities Guarantee Trustee
--------------------------------------------------------
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Securities Guarantee Trustee may conclusively
rely, and shall be fully protected in acting or refraining from acting,
upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the Guarantor contemplated by this
Preferred Securities Guarantee may be sufficiently evidenced by an
Officers' Certificate.
(iii) Whenever, in the administration of this Preferred Securities
Guarantee, the Preferred Securities Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering
or omitting any action hereunder, the Preferred Securities Guarantee
Trustee (unless other evidence is herein specifically prescribed) may, in
the absence of bad faith on its part, request and conclusively rely upon an
Officers' Certificate which, upon receipt of such request, shall be
promptly delivered by the Guarantor.
(iv) The Preferred Securities Guarantee Trustee shall have no duty to
see to any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof).
(v) The Preferred Securities Guarantee Trustee may consult with
counsel of its selection, and the advice or opinion of such counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with such advice or opinion.
Such counsel may be counsel to the Guarantor or any of its Affiliates and
may include any of its employees. The Preferred Securities Guarantee
Trustee shall have the right at any time to seek instructions concerning
the administration of this Preferred Securities Guarantee from any court
of competent jurisdiction.
(vi) The Preferred Securities Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Preferred Securities Guarantee at the request or direction of any Holder,
unless such Holder shall have provided to the Preferred Securities
Guarantee Trustee such security and indemnity, reasonably satisfactory to
the Preferred Securities Guarantee Trustee, against the costs, expenses
(including attorneys' fees and expenses and the expenses of the Preferred
Securities Guarantee Trustee's agents,
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nominees or custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Preferred Securities Guarantee Trustee;
provided that, nothing contained in this Section 3.2(a)(vi) shall be taken
to relieve the Preferred Securities Guarantee Trustee, upon the occurrence
of an Event of Default, of its obligation to exercise the rights and powers
vested in it by this Preferred Securities Guarantee.
(vii) The Preferred Securities Guarantee Trustee shall not be bound
to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document, but the Preferred Securities
Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit.
(viii) The Preferred Securities Guarantee Trustee may execute any of
the trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents, nominees, custodians or attorneys, and
the Preferred Securities Guarantee Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder.
(ix) Any action taken by the Preferred Securities Guarantee Trustee
or its agents hereunder shall bind the Holders, and the signature of the
Preferred Securities Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action. No third party shall
be required to inquire as to the authority of the Preferred Securities
Guarantee Trustee to so act or as to its compliance with any of the terms
and provisions of this Preferred Securities Guarantee, both of which shall
be conclusively evidenced by the Preferred Securities Guarantee Trustee's
or its agent's taking such action.
(x) Whenever in the administration of this Preferred Securities
Guarantee the Preferred Securities Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Preferred Securities
Guarantee Trustee (i) may request instructions from the Holders of a
Majority in liquidation amount of the Preferred Securities, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in
conclusively relying on or acting in accordance with such instructions.
(xi) The Preferred Securities Guarantee Trustee shall not be liable
for any action taken, suffered, or omitted to be taken by it in good faith,
without negligence, and reasonably believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Preferred Securities Guarantee.
(b) No provision of this Preferred Securities Guarantee shall be
deemed to impose any duty or obligation on the Preferred Securities Guarantee
Trustee to perform any act or
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acts or exercise any right, power, duty or obligation conferred or imposed on it
in any jurisdiction in which it shall be illegal, or in which the Preferred
Securities Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or authority available to
the Preferred Securities Guarantee Trustee shall be construed to be a duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of Preferred Securities
----------------------------------------------------------------
Guarantee
---------
The recitals contained in this Preferred Securities Guarantee shall
be taken as the statements of the Guarantor, and the Preferred Securities
Guarantee Trustee does not assume any responsibility for their correctness. The
Preferred Securities Guarantee Trustee makes no representation as to the
validity or sufficiency of this Preferred Securities Guarantee.
ARTICLE IV
PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Preferred Securities Guarantee Trustee; Eligibility
---------------------------------------------------
(a) There shall at all times be a Preferred Securities Guarantee
Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least 50 million
U.S. dollars ($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then, for the purposes of this Section 4.1(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Preferred Securities Guarantee Trustee shall
cease to be eligible to so act under Section 4.1(a), the Preferred Securities
Guarantee Trustee shall immediately resign in the manner and with the effect set
out in Section 4.2(c).
(c) If the Preferred Securities Guarantee Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Preferred Securities
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Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Preferred Securities
------------------------------------------------------------
Guarantee Trustee
-----------------
(a) Subject to Section 4.2(b), the Preferred Securities Guarantee
Trustee may be appointed or removed without cause at any time by the Guarantor
except during an Event of Default.
(b) The Preferred Securities Guarantee Trustee shall not be removed
in accordance with Section 4.2(a) until a Successor Preferred Securities
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Preferred Securities Guarantee
Trustee and delivered to the Guarantor.
(c) The Preferred Securities Guarantee Trustee shall hold office
until a Successor Preferred Securities Guarantee Trustee shall have been
appointed or until its removal or resignation. The Preferred Securities
Guarantee Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the Preferred Securities
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Preferred Securities Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed by
such Successor Preferred Securities Guarantee Trustee and delivered to the
Guarantor and the resigning Preferred Securities Guarantee Trustee.
(d) If no Successor Preferred Securities Guarantee Trustee shall have
been appointed and accepted appointment as provided in this Section 4.2 within
60 days after delivery of an instrument of removal or resignation, the Preferred
Securities Guarantee Trustee resigning or being removed may petition any court
of competent jurisdiction for appointment of a Successor Preferred Securities
Guarantee Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper, appoint a Successor Preferred Securities Guarantee
Trustee.
(e) No Preferred Securities Guarantee Trustee shall be liable for the
acts or omissions to act of any Successor Preferred Securities Guarantee
Trustee.
(f) Upon termination of this Preferred Securities Guarantee or
removal or resignation of the Preferred Securities Guarantee Trustee pursuant
to this Section 4.2, the Guarantor shall pay to the Preferred Securities
Guarantee Trustee all amounts due to the Preferred Securities Guarantee Trustee
accrued to the date of such termination, removal or resignation.
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ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
---------
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Issuer), as and when due, regardless of any defense, right of set-
off or counterclaim that the Issuer may have or assert. The Guarantor's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Guarantor to the Holders or by causing the Issuer to pay
such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
---------------------------
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Issuer or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands. Notwithstanding anything to the contrary herein, the
Guarantor retains all of its rights under the Indenture to extend the interest
payment period on the Subordinated Debentures and the Guarantor shall not be
obligated hereunder to make any Guarantee Payment during any extended Interest
Payment Period (as defined in the Indenture) with respect to the Distributions
(as defined in the Declaration) on the Preferred Securities.
SECTION 5.3 Obligations Not Affected
------------------------
The obligations, covenants, agreements and duties of the Guarantor
under this Preferred Securities Guarantee shall be absolute and unconditional
and shall remain in full force and effect until the entire liquidation amount of
all outstanding Preferred Securities shall have been paid and such obligation
shall in no way be affected or impaired by reason of the happening from time to
time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be
performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation Distribution or other
sum payable that results from the extension of any interest payment period on
the Debentures permitted by the Indenture);
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(c) any failure, omission, delay or lack of diligence on the part of
the Property Trustee or the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Property Trustee or the Holders
pursuant to the terms of the Preferred Securities, or any action on the part of
the Issuer granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor with respect to the
Guarantee Payments shall be absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 Rights of Holders
-----------------
(a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Preferred Securities Guarantee
Trustee in respect of this Preferred Securities Guarantee or exercising any
trust or power conferred upon the Preferred Securities Guarantee Trustee under
this Preferred Securities Guarantee.
(b) If the Preferred Securities Guarantee Trustee fails to enforce
such Preferred Securities Guarantee, any Holder may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Preferred
Securities Guarantee, without first instituting a legal proceeding against the
Issuer, the Preferred Securities Guarantee Trustee or any other person or
entity. Notwithstanding the foregoing, if the Guarantor has failed to make a
Guarantee Payment, a Holder may directly institute a proceeding in such Holder's
own name against the Guarantor for enforcement of the Preferred Securities
Guarantee for such payment. The Guarantor waives any right or remedy to require
that any action be brought first against the Issuer or any other person or
entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
--------------------
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This Preferred Securities Guarantee creates a guarantee of payment
and not of collection.
SECTION 5.6 Subrogation
-----------
The Guarantor shall be subrogated to all (if any) rights of the
Holders against the Issuer in respect of any amounts paid to such Holders by the
Guarantor under this Preferred Securities Guarantee; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any right that it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Preferred Securities Guarantee, if, at the time
of any such payment, any amounts are due and unpaid under this Preferred
Securities Guarantee. If any amount shall be paid to the Guarantor in violation
of the preceding sentence, the Guarantor agrees to hold such amount in trust for
the Holders and to pay over such amount to the Holders.
SECTION 5.7 Independent Obligations
-----------------------
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (h), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
--------------------------
So long as any Preferred Securities remain outstanding, the Guarantor
shall not, and shall not permit any subsidiary of the Guarantor to, (i) declare
or pay any dividends or distributions on, or redeem, purchase, acquire, or make
a liquidation payment with respect to, any of the Guarantor's capital stock
(which includes common and preferred stock)(other than (a) dividends or
distributions in shares of, or options, warrants, rights to subscribe for or
purchase shares of, common stock of the Guarantor, (b) any declaration of a
dividend in connection with the implementation of a stockholders' rights plan,
or the issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (c) as a result of a
reclassification of the Guarantor's capital stock or the exchange or the
conversion of one class or series of the Guarantor's capital stock for another
class or series of the Guarantor's capital stock, (d) the purchase of fractional
interests in shares of the Guarantor's capital stock pursuant to the conversion
or exchange provisions of such capital stock or the security being converted or
exchanged, and (e) purchases of the Guarantor's common stock related to the
issuance of the Guarantor's common stock or rights under any of the Guarantor's
benefit plans for its directors, officers, employees or any of the Guarantor's
dividend reinvestment plans), (ii) make any payment of principal of, or premium,
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if any, or interest on or repay, repurchase or redeem any debt securities of the
Guarantor (including any Other Debentures) that rank pari passu with or junior
in right of payment to the Debentures or (iii) make any guarantee payments with
respect to any guarantee (other than payments under the Preferred Securities
Guarantee) by the Guarantor of the debt securities of any subsidiary of the
Guarantor (including Other Guarantees) if such guarantee ranks pari passu with
or junior in right of payment to the Debentures if at such time (1) there shall
have occurred any event of which the Guarantor has actual knowledge that (a)
with the giving of notice or the lapse of time, or both, would constitute an
Indenture Event of Default and (b) in respect of which the Guarantor shall not
have taken reasonable steps to cure, (2) an Indenture Event of Default shall
have occurred and be continuing, (3) if such Debentures are held by the Property
Trustee, the Guarantor shall be in default with respect to its payment of any
obligations under this Preferred Securities Guarantee or (4) the Guarantor
shall have given notice of its election of the exercise of its right to extend
the interest payment period pursuant to Section 16.01 of the Indenture or such
extension period, or any such extension shall have commenced and be continuing.
Notwithstanding the foregoing, if an Event of Default has occurred and is
continuing under the Declaration, the rights of the holders of the Common
Securities to receive Guarantee Payments under the Common Securities Guarantee
or any Other Common Securities Guarantee shall be subordinated to the rights of
the holders of the Preferred Securities, to receive payments of all amounts due
and owing to such holders under this Preferred Securities Guarantee or any
Other Guarantee.
SECTION 6.2 Ranking
-------
This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to Senior Indebtedness (as defined in the Indenture), to the same extent
and in the same manner that the Debentures are subordinated to Senior
Indebtedness pursuant to the Indenture, (ii) pari passu with the Debentures, the
Other Debentures, the Common Securities Guarantee and any Other Guarantee and
any Other Common Securities Guarantee, and (iii) senior to the Guarantor's
capital stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
-----------
This Preferred Securities Guarantee shall terminate and be of no
further force and effect (i) upon full payment of the Redemption Price (as
defined in the Declaration) of all Preferred Securities, or (ii) upon
liquidation of the Issuer, the full payment of the amounts payable in accordance
with the Declaration or the distribution of the Debentures to the Holders and
the holders of the Common Securities. Notwithstanding the foregoing, this
Preferred Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder must
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restore payment of any sums paid under the Preferred Securities or under this
Preferred Securities Guarantee.
ARTICLE VII
INDEMNIFICATION
SECTION 8.1 Exculpation
-----------
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith in accordance with this Preferred
Securities Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Preferred Securities Guarantee or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.
SECTION 8.2 Indemnification
---------------
The Guarantor agrees to indemnify each Indemnified Person for, and to
hold each Indemnified Person harmless against, any and all loss, liability,
damage, claim or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The provisions in this
Section 8.2 shall survive the termination of this Preferred Securities
Guarantee or the resignation or removal of the Preferred Securities Guarantee
Trustee.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
----------------------
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
then outstanding.
SECTION 9.2 Amendments
----------
Except with respect to any changes that do not materially adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Preferred Securities Guarantee may only be amended with the
prior approval of the Holders of a Majority in liquidation amount of the
Preferred Securities (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined). The provisions of
the Declaration with respect to consents to amendments thereof (whether at a
meeting or otherwise) shall apply to the giving of such approval.
SECTION 9.3 Notices
-------
All notices provided for in this Preferred Securities Guarantee shall
be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Issuer, in care of the Administrative Trustee at
the mailing address set forth below (or such other address as the Issuer may
give notice of to the Holders and the Preferred Securities Guarantee Trustee):
Dynegy Capital Trust II
c/o Dynegy Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxx
Administrative Trustee
Telecopy: (000) 000-0000
(b) If given to the Preferred Securities Guarantee Trustee, at the
Preferred Securities Guarantee Trustee's mailing address set forth below (or
such other address as the Preferred Securities Guarantee Trustee may give notice
of to the Holders and the Issuer):
The First National Bank of Chicago
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One First Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Services Division
Telecopy: (000) 000-0000
(c) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders and the Preferred Securities Guarantee Trustee):
Dynegy Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
(d) If given to any Holder, at the address set forth on the books and
records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.4 Benefit
-------
This Preferred Securities Guarantee is solely for the benefit of the
Holders and, subject to Section 3.1(a), is not separately transferable from the
Preferred Securities.
SECTION 9.5 GOVERNING LAW
-------------
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 9.6 Limited Liability.
-----------------
The Holders of the Preferred Securities, in their capacities as such,
shall not be personally liable for any liabilities or obligations of the
Guarantor arising out of this Preferred Securities Guarantee, and the parties
hereby agree that the Holders of the Preferred Securities, in their capacities
as such, shall be entitled to the same limitation of personal liability extended
to the stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware.
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THIS PREFERRED SECURITIES GUARANTEE is executed as of the day and year
first above written.
DYNEGY INC., as Guarantor
By:
-------------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Preferred Securities Guarantee Trustee
By:
-------------------------------------
Name:
Title:
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