EXHIBIT 4.13
EXECUTION VERSION
COLLATERAL ACCOUNT CONTROL AGREEMENT
This COLLATERAL ACCOUNT CONTROL AGREEMENT (this "Agreement"), dated
as of March 23, 2004, by and among Calpine Generating Company, LLC, a Delaware
limited liability company (the "Grantor"), Wilmington Trust Company, as
collateral agent (the "Collateral Agent") for the Secured Parties under the
Collateral Trust Agreement defined below, and Wilmington Trust Company, in its
capacity as a "securities intermediary" as defined in Section 8-102 of the UCC
and a "bank" as defined in Section 9-102 of the UCC (in such capacities, the
"Financial Institution"). Capitalized terms used but not defined herein shall
have the meanings assigned in the Collateral Trust Agreement (as amended,
amended and restated, supplemented and otherwise modified from time to time, the
"Collateral Trust Agreement"), dated as of the date hereof, by and among Calpine
CalGen Holdings, Inc., a Delaware corporation, the Grantor, the Guarantors party
thereto from time to time, the Collateral Agent, and the other agents and
trustees party thereto from time to time, as of the date hereof or as amended in
accordance with the terms of the Collateral Trust Agreement. All references
herein to the "UCC" shall mean the Uniform Commercial Code as in effect in the
State of New York.
RECITALS
WHEREAS, the parties hereto acknowledge that the Grantor has granted
to the Collateral Agent a security interest in the Pledged Accounts (as
hereinafter defined) pursuant to the Security Agreement (as amended, amended and
restated, supplemented and otherwise modified from time to time, the "Security
Agreement"), dated as of the date hereof, by and among the Grantor, the
Guarantors party thereto from time to time and the Collateral Agent; and
WHEREAS, the parties hereto are entering into this Agreement to
perfect and ensure the priority of such security interest in the Pledged
Accounts.
AGREEMENT
NOW, THEREFORE, in consideration of the premises herein and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree for the benefit of the
Secured Parties as follows:
SECTION 1. ESTABLISHMENT AND MAINTENANCE OF PLEDGED ACCOUNTS.
(a) The Financial Institution hereby represents and warrants
that it has established and currently maintains the accounts listed on Schedule
1 hereto and that the Grantor is its sole customer or entitlement holder with
respect to each such account. Each such account and any successor account and
all other accounts that the Grantor now or hereafter maintains with the
Financial Institution being referred to herein individually as a "Pledged
Account" and collectively as the "Pledged Accounts." The Financial Institution
covenants and agrees that it shall not change the name or account number of any
Pledged Account without the prior written consent of the Collateral Agent;
(b) Each of the parties hereto acknowledges and agrees that
the accounts listed on Part A of Schedule 1 hereto are intended to be deposit
accounts (as defined in Section 9-102(a)(29) of the UCC) and the accounts listed
on Part B of Schedule 1 hereto are intended to be securities accounts (as
defined in Section 8-501 of the UCC). Notwithstanding such intention, as used
herein "Deposit Account" shall mean any Pledged Account (or any part thereof)
that is determined to be a "deposit account" (within the meaning of Section
9-102(a)(29) of the UCC) and "Securities Account" shall mean any Pledged Account
(or any part thereof) that is determined to be a "securities account" (within
the meaning of Section 8-501 of the UCC).
(c) The Financial Institution covenants and agrees that: (i)
all securities or other property underlying any financial assets credited to any
Securities Account shall be registered in the name of the Financial Institution,
indorsed to the Financial Institution or indorsed in blank or credited to
another securities account maintained in the name of the Financial Institution;
(ii) in no case will any financial asset credited to any Securities Account be
registered in the name of the Grantor, payable to the order of the Grantor or
specially indorsed to the Grantor except to the extent the foregoing have been
specially indorsed to the Financial Institution or indorsed in blank; and (iii)
all such property delivered to the Financial Institution pursuant to the
Security Agreement will be promptly credited to one of the Pledged Accounts.
SECTION 2. "FINANCIAL ASSETS" ELECTION. The Financial Institution
hereby agrees that each item of property (including, without limitation, all
Cash Equivalents and any investment property, financial asset, security,
instrument or cash) credited to any Pledged Account that is a Securities Account
shall be treated as a "financial asset" within the meaning of Section
8-102(a)(9) of the UCC.
SECTION 3. COLLATERAL AGENT'S CONTROL OF THE PLEDGED ACCOUNTS. If at
any time after the Collateral Agent has delivered to the Financial Institution a
Notice of Default in substantially the form set forth in Exhibit A hereto, the
Financial Institution shall receive from the Collateral Agent an entitlement
order (i.e., an order directing transfer or redemption of any financial asset
relating to a Pledged Account) or any instruction (within the meaning of Section
9-104 of the UCC, i.e., an instruction directing the disposition of funds in a
Pledged Account) originated by the Collateral Agent, the Financial Institution
shall comply with such entitlement order or instruction without further consent
by the Grantor or any other person. The Collateral Agent agrees not to deliver a
Notice of Default unless (i) an Event of Default (as defined below) has occurred
and (ii) it has received lawful directions pursuant to the Collateral Trust
Agreement; however, it is understood and agreed that the Financial Institution
shall rely exclusively on a Notice of Default as to the existence of an Event of
Default and shall be under no obligation to make any independent investigation
as to the existence of an Event of Default. If the Grantor is otherwise entitled
to give any entitlement orders or instructions with respect to the Pledged
Accounts in accordance with Section 4 hereof and such entitlement orders or
instructions conflict with instructions of the Collateral Agent, the Financial
Institution shall comply with the entitlement orders and instructions issued by
the Collateral Agent. For purposes of this Agreement, "Event of Default" means
an "Event of Default" under and as defined in any of the Indentures, any of the
Term Loan Agreements, the Revolving Loan Agreement or any other Secured Debt
Document.
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In the event that any of the Pledged Accounts is not considered a
"securities account" or "deposit account" under applicable law or a security
interest cannot be granted and perfected in such Pledged Accounts under the UCC,
then such Pledged Accounts and all property deposited therein shall be deemed
under the exclusive dominion and control of the Collateral Agent, and the
Financial Institution as its agent, for the purpose of the creation and
perfection of security interests in favor of the Collateral Agent for the
benefit of the Secured Parties.
SECTION 4. GRANTOR'S ACCESS TO THE PLEDGED ACCOUNTS. If at any time
the Collateral Agent has delivered to the Financial Institution a Notice of
Default in substantially the form set forth in Exhibit A hereto, then the
Financial Institution agrees that thereafter until the Collateral Agent has
informed the Financial Institution in writing that the Event of Default no
longer exists, it will take all directions with respect to the Pledged Accounts
solely from the Collateral Agent and shall not comply with instructions or
entitlement orders of the Grantor or any other person. So long as no Notice of
Default has been delivered to the Financial Institution by the Collateral Agent,
the Grantor shall be entitled to give, and the Collateral Agent may act upon,
any entitlement order or instruction with respect to the Pledged Accounts as it
deems appropriate.
SECTION 5. SUBORDINATION OF LIEN; WAIVER OF SET-OFF. In the event
that the Financial Institution has or subsequently obtains by agreement, by
operation of law or otherwise a security interest in any Pledged Account or any
financial assets, cash or other property credited thereto, the Financial
Institution hereby agrees that such security interest shall be subordinate to
the security interest of the Collateral Agent. The financial assets, money and
other items credited to any Pledged Account will not be subject to deduction,
set-off, banker's lien, or any other right in favor of any person other than the
Collateral Agent (except that the Financial Institution may set off (i) all
amounts due to the Financial Institution in respect of customary fees and
expenses for the routine maintenance and operation of the respective Pledged
Account and (ii) the face amount of any checks which have been credited to such
Pledged Account but are subsequently returned unpaid because of uncollected or
insufficient funds).
SECTION 6. CHOICE OF LAW. This Agreement shall be governed by the
laws of the State of New York. Regardless of any provision in any other
agreement, for purposes of the UCC, with respect to each Pledged Account New
York shall be deemed to be the bank's jurisdiction (within the meaning of
Section 9-304 of the UCC) and the securities intermediary's jurisdiction (within
the meaning of Section 8-110 of the UCC). The Pledged Accounts shall be governed
by the laws of the State of New York.
SECTION 7. CONFLICT WITH OTHER AGREEMENTS. The Financial Institution
hereby represents, warrants, covenants and agrees that:
(a) there are no other agreements entered into between the
Financial Institution and the Grantor with respect to any Pledged Account (other
than those referred to herein and other than agreements necessary for opening
and establishing the Pledged Account);
(b) it has not entered into, and until the termination of
this Agreement will not enter into, any agreement with any other person relating
the Pledged Accounts and/or
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any financial assets credited thereto pursuant to which it agrees or has agreed
to comply with entitlement orders (as defined in Section 8-102(a)(8) of the UCC)
or instructions (within the meaning of Section 9-104 of the UCC) of such other
person;
(c) it has not entered into, and until the termination of
this Agreement will not enter into, any agreement with the Grantor or the
Collateral Agent purporting to limit or condition the obligation of the
Financial Institution to comply with entitlement orders or instructions, except
as may be otherwise provided herein; and
(d) in the event of any conflict between this Agreement (or
any portion thereof) and any other agreement now existing or hereafter entered
into, the terms of this Agreement shall prevail.
Notwithstanding the foregoing, it is hereby agreed that the
Collateral Agent and the Financial Institution shall be afforded all of the
rights, powers, protections, indemnitees and immunities set forth in the
Collateral Trust Agreement, the Security Agreement and any other Secured Debt
Document to which they are a party as if the same were specifically set forth
herein. All the provisions contained in this Agreement are expressly subject to
all of the provisions contained in the Collateral Trust Agreement in all
respects. If any conflict or inconsistency exists between this Agreement and the
Collateral Trust Agreement, the Collateral Trust Agreement shall govern.
SECTION 8. ADVERSE CLAIMS. The Financial Institution represents and
warrants that, except for the claims and interest of the Collateral Agent, the
Financial Institution and of the Grantor in the Pledged Accounts, it does not
know of any security interest in, lien on or claim to, or other interest in, any
Pledged Account or in any "financial asset" (as defined in Section 8-102(a) of
the UCC) credited thereto. If any person asserts any lien, encumbrance or
adverse claim (including any writ, garnishment, judgment, warrant of attachment,
execution or similar process) against the Pledged Accounts or in any financial
asset carried therein, the Financial Institution will promptly notify the
Collateral Agent and the Grantor thereof.
SECTION 9. ADDITIONAL PROVISIONS REGARDING MAINTENANCE OF THE
PLEDGED ACCOUNTS. The Financial Institution covenants and agrees:
(a) Statements and Confirmations. The Financial Institution
will promptly send copies of all statements, confirmations and other
correspondence concerning (i) any Securities Account and/or any financial assets
credited thereto and (ii) any Deposit Account, simultaneously to each of the
Grantor and the Collateral Agent at the address for each set forth in Section 13
of this Agreement.
(b) Tax Reporting. All items of income, gain, expense and
loss recognized in any Securities Account and all interest, if any, relating to
any Deposit Account, shall be reported to the Internal Revenue Service and all
state and local taxing authorities under the name and taxpayer identification
number of the Grantor.
(c) Voting Rights. At any time during which the Grantor is
entitled to give entitlement orders pursuant to Section 4 hereof, the Grantor
shall direct the Financial Institution with respect to the voting of any
financial assets credited to the Pledged Accounts. At
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all other times, the Collateral Agent shall control the right to vote with
respect to such financial assets.
(d) Cash Equivalents. At any time during which the Grantor
is entitled to give entitlement orders pursuant to Section 4 hereof, the Grantor
shall direct the Financial Institution with respect to the selection of
investments to be made for any Securities Account; provided, however, that the
Financial Institution shall not honor any instruction to purchase any
investments other than Cash Equivalents. At all other times, the Collateral
Agent shall control the selection of investments to be made for any Securities
Account.
SECTION 10. INDEMNIFICATION OF FINANCIAL INSTITUTION. The Financial
Institution undertakes to perform only such duties as are expressly set forth
herein and no other duties shall be implied. The Financial Institution may rely
upon and shall not be liable for acting or refraining from acting upon any
written notice, instruction or request furnished to it hereunder and believed by
it to be genuine and to have been signed or presented by the proper party or
parties in compliance with the provisions hereof. The Financial Institution
shall be under no duty to inquire into or investigate the validity, accuracy or
content of any such document. The Grantor and the Collateral Agent hereby agree
that (a) the Financial Institution is released from any and all liabilities to
the Grantor and the Collateral Agent arising from the terms of this Agreement
and the compliance of the Financial Institution with the terms hereof, except to
the extent that such liabilities arise from the Financial Institution's gross
negligence as determined by a court of competent jurisdiction and (b) the
Grantor and its successors and assigns shall at all times indemnify and save
harmless the Financial Institution from and against any and all claims, actions
and suits of others (including, without limitation, the Grantor and the
Collateral Agent) arising out of the terms of this Agreement or the compliance
of the Financial Institution with the terms hereof, except to the extent that
such arises from the Financial Institution's gross negligence as determined by a
court of competent jurisdiction, and from and against any and all liabilities,
losses, damages, costs, charges, counsel fees and other expenses of every nature
and character arising by reason of the same, until the termination of this
Agreement. The indemnities provided herein shall survive the termination of this
Agreement and any resignation or removal of the Financial Institution.
SECTION 11. SUCCESSORS; ASSIGNMENT. The terms of this Agreement
shall be binding upon, and shall inure to the benefit of, the parties hereto and
their respective successors and assigns, except that neither the Grantor nor the
Financial Institution may delegate its obligations hereunder without the prior
written consent of the Collateral Agent. Additionally, in the event that the
Collateral Agent is replaced as the collateral agent under the Collateral Trust
Agreement, any entity that succeeds to such role shall be entitled to the
benefits of this Agreement. The Collateral Agent agrees to send written notice
to the Financial Institution of any such replacement.
SECTION 12. NOTICES. Any notice, request or other communication
required or permitted to be given under this Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party
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at the address set forth in the Collateral Trust Agreement or, if to the
Financial Institution, as set forth below.
Financial Institution: Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Corporate Capital Markets
Facsimile: (000)000-0000
Any party may change his address for notices by giving notice to the
other parties hereto in the manner set forth above.
SECTION 13. AMENDMENT. No amendment or modification of this
Agreement or waiver of any right hereunder shall be binding on any party hereto
unless it is in writing and is signed by all of the parties hereto.
SECTION 14. TERMINATION. The obligations of the Financial
Institution to the Collateral Agent pursuant to this Agreement shall continue in
effect until the security interests of the Collateral Agent in each of the
Pledged Accounts have been terminated pursuant to the terms of the Security
Agreement and the Collateral Agent has notified the Financial Institution of
such termination in writing. The Collateral Agent agrees to provide a Notice of
Termination in substantially the form of Exhibit B hereto to the Financial
Institution upon the request of the Grantor on or after the termination of the
Collateral Agent's security interest in the Pledged Accounts pursuant to the
terms of the Security Agreement. The termination of this Agreement shall not
terminate the Pledged Accounts or alter the obligations of the Financial
Institution to the Grantor pursuant to any other agreement with respect to the
Pledged Accounts.
SECTION 15. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Agreement by signing and
delivering one or more counterparts.
(signature page follows)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be as of the date first written above.
CALPINE GENERATING COMPANY, LLC,
as the Grantor
By: /s/ Xxxxx Xxxx
------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
[Collateral Account Control Agreement - Calpine Generating Company, LLC]
WILMINGTON TRUST COMPANY,
as the Collateral Agent
By: /s/ Xxxxx X. XxXxxxxx
------------------------------------
Name: Xxxxx X. XxXxxxxx
Title: Authorized Signer
WILMINGTON TRUST COMPANY,
as the Financial Institution
By: /s/ Xxxxx X. XxXxxxxx
------------------------------------
Name: Xxxxx X. XxXxxxxx
Title: Authorized Signer
[Collateral Account Control Agreement - Calpine Generating Company, LLC]
SCHEDULE 1
Part A List of Existing Deposit Accounts Subject to this Agreement
Exact Name of Account Account Number
--------------------- --------------
None.
Part B List of Existing Securities Accounts Subject to this Agreement
Exact Name of Account Account Number
--------------------- --------------
"CALGEN REV A/C SUB
SEC INT OF WTC AS CA" 65572-1
Exhibit A
[Letterhead of Collateral Agent]
[Date]
Wilmington Trust Company,
as Financial Institution
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Corporate Capital Markets
Re: Notice of Default
Ladies and Gentlemen:
As referenced in the Collateral Account Control Agreement, dated as
of March 23, 2004, among Calpine Generating Company, LLC, you and the
undersigned, we hereby give you notice that an Event of Default has occurred and
is continuing. You are hereby instructed not to accept any direction,
instructions or entitlement orders with respect to the Pledged Accounts or the
financial assets or funds credited thereto from any person other than the
undersigned, unless otherwise ordered by a court of competent jurisdiction or
otherwise directed by us in writing.
You are instructed to deliver a copy of this notice by facsimile
transmission to Calpine Generating Company, LLC.
Very truly yours,
Wilmington Trust Company,
as Collateral Agent
By:____________________________
Title:
cc: Calpine Generating Company, LLC
Exhibit B
[Letterhead of Collateral Agent]
[Date]
Wilmington Trust Company,
as Financial Institution
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Corporate Capital Markets
Re: Termination of Collateral Account Control Agreement
You are hereby notified that the Collateral Account Control
Agreement, dated as of March 23, 2004, by and among Calpine Generating Company,
LLC, you and the undersigned is terminated and you have no further obligations
to the undersigned pursuant to such Agreement. Notwithstanding any previous
instructions to you, you are hereby instructed to accept all future directions
with respect to account number(s)_________________________________from Calpine
Generating Company, LLC. This notice terminates any obligations you may have to
the undersigned with respect to such account; however nothing contained in this
notice shall alter any obligations which you may otherwise owe to Calpine
Generating Company, LLC pursuant to any other agreement.
You are instructed to deliver a copy of this notice by facsimile
transmission to Calpine Generating Company, LLC.
Very truly yours,
Wilmington Trust Company,
as Collateral Agent
By:_______________________________
Title:
cc: Calpine Generating Company, LLC
