Exhibit 10.1.7
ORMAT FUNDING CORP.,
AS THE Issuer
XXXXX POWER PARTNERS
STEAMBOAT DEVELOPMENT CORP.
STEAMBOAT GEOTHERMAL LLC
ORMAMMOTH INC.
ORNI 1 LLC
ORNI 2 LLC
ORNI 7 LLC,
AS GUARANTORS
ORMESA LLC
$190,000,000
8 1/4% SENIOR SECURED NOTES DUE DECEMBER 30, 2020
INDENTURE
DATED AS OF FEBRUARY 13, 0000
XXXXX XXXX XX XXXXXXXXXX, N.A.,
AS TRUSTEE
TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE.............................................................1
Section 1.01 Definitions..........................................................................1
Section 1.02 Other Definitions...................................................................34
Section 1.03 Trust Indenture Act Provisions......................................................35
Section 1.04 Rules of Construction...............................................................35
ARTICLE II THE SENIOR SECURED NOTES.............................................................................36
Section 2.01 Form Generally......................................................................36
Section 2.02 Legends on Restricted Notes.........................................................38
Section 2.03 Amount of Senior Secured Notes......................................................38
Section 2.04 Denominations.......................................................................39
Section 2.05 Execution, Authentication, Delivery and Dating......................................39
Section 2.06 Temporary Senior Secured Notes......................................................41
Section 2.07 Registration, Registration of Transfer and Exchange.................................41
Section 2.08 Mutilated, Destroyed, Lost and Stolen Senior Secured Notes..........................48
Section 2.09 Payments; Interest Rights Preserved.................................................49
Section 2.10 Persons Deemed Owners...............................................................50
Section 2.11 Cancellation........................................................................51
Section 2.12 Computation of Interest.............................................................51
Section 2.13 Certification Forms.................................................................51
Section 2.14 CUSIP Numbers.......................................................................51
Section 2.15 Issuance of Additional Notes........................................................52
ARTICLE III REDEMPTION AND PREPAYMENT...........................................................................52
Section 3.01 Notices to Trustee..................................................................52
Section 3.02 Selection of Senior Secured Notes to Be Redeemed....................................52
Section 3.03 Notice of Redemption................................................................53
Section 3.04 Effect of Notice of Redemption......................................................54
Section 3.05 Deposit of Redemption Price.........................................................54
Section 3.06 Senior Secured Notes Redeemed in Part...............................................54
Section 3.07 Optional Redemption.................................................................55
Section 3.08 Mandatory Redemption................................................................55
ARTICLE IV COVENANTS............................................................................................57
Section 4.01 Payment of Senior Secured Notes.....................................................57
Section 4.02 Maintenance of Office or Agency.....................................................57
Section 4.03 Reporting Requirements..............................................................58
Section 4.04 Delivery of Notices to Trustee......................................................59
Section 4.05 Stay, Extension and Usury Laws......................................................59
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Section 4.06 Restrictions on Sale of Assets......................................................59
Section 4.07 Insurance...........................................................................60
Section 4.08 Governmental Approvals; Title.......................................................61
Section 4.09 Limitation on Nature of Business....................................................61
Section 4.10 Prohibition on Merger or Other Fundamental Changes..................................61
Section 4.11 Restricted Payments.................................................................61
Section 4.12 Revenue Account.....................................................................61
Section 4.13 Transactions with Affiliates........................................................62
Section 4.14 Exercise of Rights..................................................................63
Section 4.15 Termination or Amendment to Material Project Documents..............................63
Section 4.16 Additional Project Documents........................................................63
Section 4.17 Performance of Project Documents....................................................64
Section 4.18 Limitations on Indebtedness.........................................................64
Section 4.19 Limitation on Indebtedness of Subsidiaries..........................................66
Section 4.20 Limitations on Guarantees...........................................................66
Section 4.21 Prohibitions on Other Obligations or Assignments....................................66
Section 4.22 Books and Records, Inspection.......................................................67
Section 4.23 Maintenance of Existence............................................................67
Section 4.24 Additional Documents; Filings and Recordings........................................67
Section 4.25 Dividend and Other Payment Restrictions Affecting Subsidiaries......................67
Section 4.26 Budget And Expenditures.............................................................68
Section 4.27 Limitation on Liens.................................................................68
Section 4.28 Compliance With Laws................................................................68
Section 4.29 Operation and Maintenance...........................................................69
Section 4.30 Additional Subsidiaries; Bank Accounts..............................................69
Section 4.31 Maintenance of Water Supply; Access Rights..........................................69
Section 4.32 No Abandonment......................................................................69
Section 4.33 Consents to Assignment of Unassigned Leases Additional Project Documents............69
Section 4.34 Loans...............................................................................69
Section 4.35 Amendments to Organizational Documents..............................................69
Section 4.36 Removal of Independent Consultant...................................................70
Section 4.37 Payments for Consent................................................................70
Section 4.38 Limitations on Ormesa...............................................................70
Section 4.39 Limitation on Issuance and Sale of Capital Stock of Subsidiaries....................70
Section 4.40 Maintenance of Qualifying Facility Status...........................................71
Section 4.41 Payment of taxes and claims.........................................................71
Section 4.42 Repayment of Ormesa Credit Agreement................................................71
Section 4.43 Provision of Additional Liens.......................................................71
Section 4.44 Galena Re-powering..................................................................71
Section 4.45 Title Policies......................................................................71
Section 4.46 Preservation of Liens...............................................................71
Section 4.47 Title Reports.......................................................................72
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ARTICLE V DEFAULTS AND REMEDIES.................................................................................72
Section 5.01 Events of Default...................................................................72
Section 5.02 Enforcement of Remedies.............................................................74
Section 5.03 Other Remedies......................................................................76
Section 5.04 Waiver of Past Defaults.............................................................77
Section 5.05 Control by Majority.................................................................77
Section 5.06 Limitation on Suits.................................................................77
Section 5.07 Rights of Holders of Senior Secured Notes to Receive Payment........................78
Section 5.08 Collection Suit by Trustee..........................................................78
Section 5.09 Trustee May File Proofs of Claim....................................................78
Section 5.10 Priorities..........................................................................78
Section 5.11 Undertaking for Costs...............................................................79
ARTICLE VI TRUSTEE..............................................................................................79
Section 6.01 Duties of Trustee...................................................................79
Section 6.02 Rights of Trustee...................................................................80
Section 6.03 Individual Rights of Trustee........................................................81
Section 6.04 Trustee's Disclaimer................................................................82
Section 6.05 Notice of Defaults..................................................................82
Section 6.06 Reports by Trustee to Holders of the Senior Secured Notes...........................82
Section 6.07 Compensation and Indemnity..........................................................83
Section 6.08 Replacement of Trustee..............................................................84
Section 6.09 Successor Trustee by Merger, etc....................................................85
Section 6.10 Eligibility; Disqualification.......................................................85
Section 6.11 Preferential Collection of Claims Against the Issuer................................85
Section 6.12 Receipt of Documents................................................................86
ARTICLE VII LEGAL DEFEASANCE AND COVENANT DEFEASANCE............................................................86
Section 7.01 Option to Effect Legal Defeasance or Covenant Defeasance............................86
Section 7.02 Legal Defeasance and Discharge......................................................86
Section 7.03 Covenant Defeasance.................................................................87
Section 7.04 Conditions to Legal or Covenant Defeasance..........................................87
Section 7.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions......................................................88
Section 7.06 Repayment to Issuer.................................................................89
Section 7.07 Reinstatement.......................................................................89
ARTICLE VIII AMENDMENT, SUPPLEMENT AND WAIVER...................................................................90
Section 8.01 Without Consent of Holders of Senior Secured Notes..................................90
Section 8.02 With Consent of Holders of Senior Secured Notes.....................................90
Section 8.03 Revocation and Effect of Consents...................................................92
Section 8.04 Notation on or Exchange of Senior Secured Notes.....................................93
Section 8.05 Trustee to Sign Amendments, etc.....................................................93
Section 8.06 Execution of Supplemental Indentures................................................93
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Section 8.07 Effect of Supplemental Indentures...................................................93
Section 8.08 Conformity with Trust Indenture Act.................................................93
Section 8.09 Reference in Senior Secured Notes to Supplemental Indentures........................93
ARTICLE IX GUARANTEE............................................................................................94
Section 9.01 Agreement to Guarantee..............................................................94
Section 9.02 Execution and Delivery of Guarantee.................................................95
Section 9.03 Guarantors May Consolidate, etc. on Certain Terms...................................96
Section 9.04 Covenants of the Guarantors and Ormesa..............................................96
ARTICLE X MISCELLANEOUS.........................................................................................96
Section 10.01 Trust Indenture Act Controls........................................................96
Section 10.02 Notices ............................................................................97
Section 10.03 Communication by Holders of Senior Secured Notes with Other
Holders of Senior Secured Notes.....................................................98
Section 10.04 Certificate and Opinion as to Conditions Precedent..................................98
Section 10.05 Statements Required in Certificate or Opinion.......................................98
Section 10.06 Rules by Trustee and Agents.........................................................99
Section 10.07 No Personal Liability of Directors, Officers, Employees and Stockholders............99
Section 10.08 Governing Law.......................................................................99
Section 10.09 Submission to Jurisdiction..........................................................99
Section 10.10 Waiver of Jury Trial................................................................99
Section 10.11 No Adverse Interpretation of Other Agreements......................................100
Section 10.12 Successors.........................................................................100
Section 10.13 Severability.......................................................................100
Section 10.14 Counterpart Originals..............................................................100
Section 10.15 Table of Contents, Headings, etc...................................................100
EXHIBITS
Exhibit A-1: FORM OF SENIOR SECURED NOTE
Exhibit A-2: FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B: FORM OF CERTIFICATE OF TRANSFER
Exhibit C: FORM OF CERTIFICATE OF EXCHANGE
Exhibit D: SUBORDINATION PROVISIONS
Exhibit E: FORM OF DEED OF TRUST
Exhibit F: FORM OF GUARANTEE
Exhibit G: FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of February 13, 2004 among Ormat Funding
Corp., a Delaware corporation (including its successors and permitted assigns,
the "Issuer"), Xxxxx Power Partners, a Nevada general partnership ("Xxxxx"),
Steamboat Development Corp., a Utah corporation ("Steamboat Development"),
Steamboat Geothermal LLC, a Delaware limited liability company ("Steamboat
Geothermal"), OrMammoth Inc., a Delaware corporation ("OrMammoth"), ORNI 1 LLC,
a Delaware limited liability company ("ORNI 1"), ORNI 2 LLC, a Delaware limited
liability company ("ORNI 2"), ORNI 7 LLC, a Delaware limited liability company
("ORNI 7"), Ormesa LLC and Union Bank of California, N.A., a national banking
association, as trustee (the "Trustee").
The Issuer, the Guarantors (as defined) and the Trustee agree
as follows for the benefit of each other and for the equal and ratable benefit
of the Holders of the 8 1/4% Senior Secured Notes due December 30, 2020, any
Additional Notes (as defined below) and the Exchange Notes (as defined below)
issued pursuant to the Registration Rights Agreement:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
"Acceptable Letter of Credit" means one or more irrevocable
standby letters of credit available for the purpose of drawing in accordance
with the Depositary Agreement, and any extensions thereof or any substitute
letter of credit therefor in the stated amount contained in such extension or
substitute, subject to the limitations set forth in, and permitting draws
thereon as contemplated by the Depositary Agreement, (i) issued to the
Depositary Agent (for the benefit of the Secured Parties entitled to the
benefits of the applicable Account) by a commercial bank having a long-term
unsecured senior debt rating of at least Investment Grade, (ii) payable in
immediately available U.S. Dollar funds on any Business Day, (iii) with a
minimum term of at least one year, (iv) providing for the amount thereof to be
available to the Depositary Agent in multiple drawings conditioned only upon
presentation of sight drafts accompanied by the applicable certificate in the
form attached to such letter of credit or if the issuing bank ceases to be an
Eligible Letter of Credit Provider, (v) transferable to any successor Depositary
Agent, the Collateral Agent or a successor Collateral Agent (or if not
transferable provides for the amount thereof to be drawn upon by the Depositary
Agent upon appointment of a successor Depositary Agent or Collateral Agent),
(vi) governed by the laws of the State of New York or California, (vii) does not
constitute Indebtedness (directly or indirectly) of the Issuer or any of its
Subsidiaries, and is not secured by a Lien on any of the properties of the
Issuer or any of its Subsidiaries, and the Issuer certifies to such in an
Officer's Certificate and (viii) which provides that it may be drawn not more
than thirty days prior to its expiration in the entire amount to be then drawn
if the issuing bank does not provide a written extension of the same to the
Depositary Agent at least 30 days prior to its then scheduled expiration date.
"Accounts" means the accounts established under the Depositary
Agreement.
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"Additional Notes" means any Senior Secured Notes (other than
Initial Notes), if any, issued under this Indenture in accordance with Sections
2.05 and 2.15 hereof.
"Additional Project Document" means any contract or agreement
entered into after the Closing Date in respect of the ownership, construction,
operation, maintenance, modification or administration of a Project that is
material to the Issuer or one or more Projects (including a Qualified Project),
other than a Financing Document. The replacement of a Project Document that is
not a Material Project Document shall be deemed not to be an Additional Project
Document.
"Administrative Costs" means all of the Issuer's obligations,
now or hereafter existing, to pay administrative fees, costs and expenses to any
trustee or agent of the Holders of the Senior Secured Notes or any Permitted
Additional Senior Lender, including the Collateral Agent, the Depositary, and
the Trustee (including, without limitation, the reasonable fees and expenses of
counsel, agents and experts).
"Affiliate" means, with respect to a Person, any other Person
that, directly or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with such first Person. The term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Agent Member" has the meaning set forth in Section
2.07(c)(v)(B) of this Indenture.
"Annual Period" means the twelve month period commencing on
January 1st of each year and ending on December 31st of each year.
"Applicable Law" means any constitution, statute, law, rule,
regulation, ordinance, judgment, order, decree or Governmental Approval, or any
published directive or requirement which has the force of law, or other
governmental restriction which has the force of law, or any determination by, or
interpretation of any of the foregoing by, any judicial authority, applicable to
and/or binding on a given Person or any Plant, as the context may require,
whether in effect as of the Closing Date or thereafter and in each case as
amended.
"Authentication Order" means a written order or request signed
in the name of the Issuer by the President, a Vice President, the Treasurer or
the Assistant Treasurer, and delivered to the Trustee.
"Authorized Officer" or "Authorized Representative" of any
Person means the individual or individuals authorized to act on behalf of such
Person by the board of directors, managing member, management committee, board
of control or any other governing body of
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such Person as designated from time to time in a certificate of such Person with
specimen signatures.
"Board of Directors" means:
(1) with respect to a corporation, the board of directors of
the corporation or any committee thereof duly authorized to act on
behalf of such board;
(2) with respect to a partnership, the board of directors of
the general partner of the partnership or any committee duly authorized
and empowered to take action on behalf of such partnership by the
partnership agreement of such partnership;
(3) with respect to a limited liability company, the managing
member or members or any controlling committee of managing members
thereof; and
(4) with respect to any other Person, the board or committee
of such Person serving a similar function.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors.
"Xxxxx" means Xxxxx Power Partners, a Nevada general
partnership.
"Xxxxx-BLM Geothermal Resources Lease N-10922" means that
certain Lease for Geothermal Resources N-10922, dated October 1, 0000, xxxxxxx
Xxxxx xxx xxx Xxxxxx Xxxxxx of America through the Bureau of Land Management of
the Department of the Interior.
"Xxxxx-BLM Geothermal Resources Lease N-40353" means that
certain Lease for Geothermal Resources N-40353, dated April 1, 0000, xxxxxxx
Xxxxx xxx xxx Xxxxxx Xxxxxx of America through the Bureau of Land Management of
the Department of the Interior.
"Xxxxx-BLM Geothermal Resources Lease N-40355" means that
certain Lease for Geothermal Resources N-40355, dated July 1, 0000, xxxxxxx
Xxxxx xxx xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of
the Department of the Interior
"Xxxxx-BLM Geothermal Resources Lease N-46566" means that
certain Lease for Geothermal Resources N-46566 between Xxxxx and the United
States of America through the Bureau of Land Management of the Department of the
Interior, dated October 1, 1975.
"Xxxxx/Desert Peak 1 Interconnection Agreement" means that
certain Service Connections, Meters and Customer's Facility Exhibit to the Xxxxx
Project Power Purchase Agreement, between Xxxxx (as successor to Nevada
Geothermal Power Partners) and Sierra Pacific Power Company.
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"Xxxxx Operation and Maintenance Agreement" means that certain
Operation and Maintenance Agreement, dated January 1, 0000, xxxxxxx Xxxxx,
Xxxxxxx Xxxxxx and Ormat Nevada as Western States' agent.
"Xxxxx Plant" means two geothermal power generating plants
located in Xxxxxxxxx County, Nevada (including the Desert Peak 1 Plant) and
having a gross generating capacity of 32 MW.
"Xxxxx Project Power Purchase Agreement" means that certain
Long Term Agreement for the Purchase and Sale of Electricity, dated October 5,
1990, between Xxxxx (as successors to Nevada Geothermal Power Partners) and
Sierra Pacific Power Company, as amended by that certain Amendment to Long Term
Agreement for the Purchase and Sale of Electricity, dated July 12, 1991, as
modified by that certain Settlement Agreement, dated February 16, 2001, between
Sierra Pacific Power Company and Xxxxx, and as further amended by that certain
Amendment No. 2 to Long Term Agreement for the Purchase and Sale of Electricity,
dated June 24, 2002.
"Xxxxx Settlement Agreement" means that certain Settlement
Agreement, dated May 1, 2002, among Xxxxx, ORNI 1 LLC, ORNI 2 LLC, Ormat Nevada,
Ormat Technologies, and ConAgra Foods, Inc.
"Business Day" means any day other than a Saturday or Sunday
or other day on which banks in New York, New York or Nevada are authorized or
required by law or executive order to remain closed.
"Capital Expenditures" means any expenses that are capitalized
on the Issuer's balance sheet in accordance with GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership interests (whether general or limited) or membership
interests; and
(4) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person including all warrants,
options or other rights to acquire any of the foregoing, but excluding
from all of the foregoing any debt securities convertible into or
exchangeable for Capital Stock, whether or not such debt securities
include any right of participation with Capital Stock.
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"Cash Flow Available for Debt Service" means, for any period,
(a) all revenues (including interest, Delay Liquidated Damages, and the proceeds
of any business interruption insurance but excluding any other insurance
proceeds and any other similar non-recurring receipts) received in such period
and deposited in the Revenue Account, less (b) the sum of (x) Operating and
Maintenance Expenses for such period plus (y) Administrative Costs payable to
the Trustee, the Collateral Agent, the Depositary and any other trustee or agent
of the Secured Parties for such period, all as computed on a cash basis.
"Certificated Note" shall mean a certificated Senior Secured
Note registered in the name of the Holder thereof and issued in accordance with
Section 2.07 hereof, substantially in the form of Xxxxxxx X-0/X-0 hereto except
that such Senior Secured Note shall not bear the Global Note Legend and shall
not have the "Schedule of Exchanges of Interests in the Global Note" attached
thereto.
"Change of Control" means the occurrence of any of the
following: (i) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the Issuer's and the Issuer's
Subsidiaries' assets, taken as a whole; (ii) the adoption of a plan relating to
the Issuer's liquidation or dissolution; (iii) the consummation of any
transaction or series of related transactions (including, without limitation,
any merger or consolidation) the result of which is that any Person other than
Ormat Nevada or a Related Party, becomes the "beneficial owner" (as such term is
defined Rule 13d-3 and Rule 13d-5 under the Exchange Act) directly or
indirectly, of 50% or more of the Issuer's voting power; or (iv) the
consummation of any transactions or series of related transactions the result of
which is that Ormat Nevada and the Related Parties cease to collectively own,
directly or indirectly, more than 50% of the Issuer's economic or voting
interest; provided, however, that notwithstanding the foregoing, a Change of
Control will not be deemed to have occurred if (x) prior to giving effect to the
reduction in Ormat Nevada's and/or the Related Parties' collective voting or
economic interests in the Issuer, such reduction has been approved by holders of
at least 66% of the Senior Secured Notes or (y) prior to giving effect to any
other Person becoming the beneficial owner of 50% or more of the Issuer's voting
power pursuant to clause (iii) hereof, the transaction resulting in such change
in beneficial ownership is approved by holders of at least 66% of the Senior
Secured Notes.
"Clearstream" means Citibank, N.A., as operator of Clearstream
Banking, S.A.
"Closing Date" means February 13, 2004.
"Code" means the U.S. Internal Revenue Code of 1986, as
amended.
"Collateral" means all collateral pledged, or in respect of
which a lien is granted, pursuant to this Indenture or the Security Documents.
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"Collateral Agency Agreement" means that certain Collateral
Agency Agreement among the Issuer, each of the Issuer's Subsidiaries, the
Collateral Agent, the Trustee and the Depositary.
"Collateral Agent" means Union Bank of California, N.A., as
collateral agent for the benefit of the Secured Parties, together with its
successors and assigns.
"Collection Expenses" means all reasonable out-of-pocket costs
or expenses (if any) and, if applicable, reasonable transaction costs, incurred
by the Issuer in connection with the collection, enforcement, negotiation,
consummation, settlement, proceedings, administration or other activity related
to the receipt and/or collection of the relevant proceeds, as applicable.
"Commercial Operation" means, in connection with the Galena
Re-powering, the achievement of certain operational and capability criteria
specified for "commercial operation" in the Galena Power Purchase Agreement.
"Commercial Operation Date" means, in connection with the
Galena Re-powering, the date upon which Commercial Operation is achieved.
"ConAgra Lease" means that certain Lease, dated May 1, 2002,
between Xxxxx and ConAgra Foods, Inc.
"Consolidated OG I Plant Connection Agreements" means the OG I
Plant Connection Agreement, the OG IH Plant Connection Agreement, and the OG IE
Plant Connection Agreement.
"Contractor" means Ormat Nevada in its capacity as contractor
if and when the Galena Re-powering Contract is executed.
"Contractor Guarantor" means Ormat Technologies.
"Control Agreements" means (i) each Control Agreement executed
and delivered by the Collateral Agent, the Issuer, certain of the Issuer's
Subsidiaries and the bank or institution where the Issuer's checking accounts
permitted to be established under this Indenture are held and (ii) each Control
Agreement executed and delivered by the Collateral Agent, the Issuer and certain
of the Issuer's Subsidiaries in connection with the Security Documents.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 4.02 hereof or such other address as
to which the Trustee may give notice to the Issuer.
"Custodian" means, initially, the Trustee, and its successors
and assigns or any other custodian performing similar functions.
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"Debt Service Coverage Ratio" means, for any period, the ratio
of (i) the sum of all Cash Flow Available for Debt Service for such period to
(ii) the aggregate payments of scheduled or accelerated (in accordance with the
terms of the Financing Documents) principal, interest, premium, and Liquidated
Damages, if any, required to be made under this Indenture and other Financing
Documents and in connection with all other Permitted Indebtedness (other than
Subordinated Debt) for such period.
"Debt Service Reserve Account" means the account of such name
created under the Depositary Agreement.
"Debt Service Reserve Letter of Credit" means an Acceptable
Letter of Credit that may be drawn in accordance with Section 3.4 of the
Depositary Agreement.
"Debt Service Reserve Requirement" means, as of any date of
calculation, an amount equal to the projected principal, interest and, to the
extent that a Registration Default has occurred and is continuing, Liquidated
Damages due on the Senior Secured Notes during the succeeding six-month period.
"Deeds of Trust" means, collectively, (i) that certain Deed of
Trust, Assignment of Rents, Security Agreement, and Fixture Filing, dated as of
the Closing Date, executed by Steamboat Geothermal, as grantor, for the benefit
of the Collateral Agent, as beneficiary, (ii) on or after the Ormesa Support
Date, that certain Deed of Trust, Assignment of Rents, Security Agreement, and
Fixture Filing, to be executed by Ormesa, as Trustor, for the benefit of the
Collateral Agent, as beneficiary, (iii) that certain Deed of Trust, Assignment
of Rents, Security Agreement, and Fixture Filing, to be executed by Steamboat
Development, as grantor, for the benefit of the Collateral Agent, as
beneficiary, in the event the respective Resource Lease Consent is obtained,
(iv) that certain Deed of Trust, Assignment of Rents, Security Agreement, and
Fixture Filing, to be executed by Xxxxx Power Partners as grantor, for the
benefit of the Collateral Agent, as beneficiary, to the extent any necessary
Resource Lease Consents are obtained, (v) a Deed of Trust, Assignment of Rents,
Security Agreement and Fixture Filing to be executed by Mammoth-Pacific, if the
Issuer or any Guarantor acquires that portion of the Capital Stock of
Mammoth-Pacific that the Issuer and the Guarantors do not own on the Closing
Date or the Issuer and the Guarantors otherwise acquire control of 100% of the
ownership interest of the Mammoth Plant, and (vi) a Deed of Trust, Assignment of
Rents, Security Agreement and Fixture Filing, or the equivalents thereof, to be
executed by the Issuer or a Subsidiary of the Issuer that acquires a Qualified
Project.
"Default" means an event or condition that, with the giving of
notice or lapse of time, or any combination thereof, would become an Event of
Default.
"Delay Liquidated Damages" means amounts to be paid by the
Contractor pursuant to Section 11.1 of the Galena Re-powering Contract.
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"Depositary Agent" means Union Bank of California, N.A., as
Depositary under the Depositary Agreement, together with its successors and
assigns.
"Depositary Agreement" means the Deposit and Disbursement
Agreement, dated as of the Closing Date, among the Issuer, each of the Issuer's
Subsidiaries (other than Ormesa prior to the Ormesa Support Date), the
Collateral Agent, the Depositary and the Securities Intermediary.
"Depository" means, with respect to the Senior Secured Notes
issuable or issued in whole or in part in global form, DTC, and any and all
successors thereto appointed as depository hereunder and having become such
pursuant to the applicable provision of this Indenture.
"Desert Peak 1 Plant" means the geothermal generating plant
located in Xxxxxxxxx County, Nevada, owned by Xxxxx and providing, as of the
Closing Date, net generating capacity of 6.1 MW.
"Desert Peak Sublease" means that certain sublease, dated as
of or before the Closing Date, between Xxxxx and Western States Geothermal
Company.
"Distribution Account" means the account of such name created
under the Depositary Agreement.
"Distribution Conditions" has the meaning set forth in Section
3.8(b) of the Depositary Agreement.
"Distribution Date" means any Business Day on or within 60
days after a Scheduled Payment Date, on which the Issuer may make a Restricted
Payment in accordance with the terms of this Indenture.
"Distribution Suspense Account" means the account of such name
created under the Depositary Agreement.
"Dollars" and "$" means lawful money of the United States.
"DTC" means The Depository Trust Company.
"Eligible Letter of Credit Provider" means a U.S. commercial
bank(s) or financial institution(s) or a U.S. branch of a foreign commercial
bank(s) or financial institution(s) with an investment grade rating (provided
that any such rating shall not be based solely on such bank's or financial
institution's foreign currency rating at such time).
"Eminent Domain Proceeds" means all amounts and proceeds
(including instruments) received by the Issuer or any Guarantor in respect of
any Event of Eminent Domain.
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"Energy Services Agreement" means that certain Energy Services
Agreement, dated February 11, 2003, between Imperial Irrigation District and
Ormesa.
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.
"ERISA" means the U.S. Employee Retirement Income Security Act
of 1974, as amended.
"Event of Abandonment" means, with respect to a Plant, the
suspension or cessation for a period of at least 120 consecutive days of all or
substantially all of the operational and maintenance activities at such Plant;
provided, however, that any such suspension or cessation that arises from an
Event of Loss, a requirement of law, an event of force majeure, curtailment or
failure to be dispatched, or other bona fide business reasons shall not
constitute an Event of Abandonment, in each case, so long as the Issuer or the
Issuer's applicable Subsidiaries are taking commercially reasonable actions to
overcome or mitigate the effects of the cause of suspension or cessation so that
maintenance and/or operations, as the case may be, can be resumed. Any period of
cessation or suspension shall end on the date that operation and maintenance
activities of a substantial nature are resumed.
"Event of Default" means the occurrence of any of the events
set forth under Section 5.01 hereof.
"Event of Eminent Domain" means any compulsory transfer or
taking or transfer under threat of compulsory transfer or taking of any material
part of the Collateral or a Project by any Governmental Authority.
"Event of Loss" means an event which causes all or a portion
of the Project to be damaged, destroyed or rendered unfit for normal use for any
reason whatsoever, other than an Event of Eminent Domain or a Title Event.
"Exchange Act" means the U.S. Securities Exchange Act of 1934,
as amended.
"Exchange Notes" means (i) the 8 1/4% Senior Secured Notes due
2020, registered under the Securities Act, issued pursuant to this Indenture in
connection with an Exchange Offer pursuant to the Registration Rights Agreement
and (ii) Additional Notes, if any, issued pursuant to a registration statement
filed with the SEC under the Securities Act.
"Exchange Offer" means the exchange and issuance by the
Issuer, pursuant to the Registration Rights Agreement, of a principal amount of
Exchange Notes (which will be registered pursuant to the Exchange Offer
Registration Statement) equal to the outstanding principal amount of Initial
Notes or Additional Notes, as the case may be, tendered by Holders thereof in
connection with such exchange and issuance.
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"Exchange Offer Registration Statement" has the meaning set
forth in the Registration Rights Agreement.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal fund transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York or, if such rate is not so published for
any day that is a Business Day, the average of the quotations for such day on
such transactions received by the issuing bank from three federal funds brokers
of recognized standing selected by it.
"FERC" means the Federal Energy Regulatory Commission and any
successor agency thereto.
"Final Acceptance" means, in connection with the Galena
Re-powering, that the Contractor has (i) satisfied or is deemed to have
satisfied all of the requirements for Final Acceptance set forth in Section 7.1
of the Galena Re-powering Contract, and (ii) delivered to ORNI 7 the final
waivers and releases of Liens.
"Final Acceptance Date" means, in connection with the Galena
Re-powering Contract, the date upon which the Contractor has achieved Final
Acceptance.
"Final Completion" means, with respect to the Galena
Re-powering, that both (a) Final Acceptance has occurred, as certified by the
Issuer and concurred with by the Independent Engineer and (b) that Commercial
Operation has occurred, as certified by the Issuer and confirmed by the Galena
Power Purchaser.
"Final Completion Date" means, with respect to the Galena
Re-powering, the date upon which both (a) Final Acceptance has occurred, as
certified by the Issuer and concurred with by the Independent Engineer and (b)
Commercial Operation has occurred, as certified by the Issuer and confirmed by
the Galena Power Purchaser.
"Final Maturity Date" means the latest stated maturity date of
any of the Senior Secured Notes.
"Financing Documents" means the Senior Secured Notes, the
Guarantees (including those issued pursuant to the Exchange Offer, if and when
issued), this Indenture, the Security Documents, the Note Purchase Agreement,
the Registration Rights Agreement, the Exchange Notes, the Letters of Credit and
any other credit or security agreement executed by a Financing Entity in respect
of a Project.
"Financing Entity" means the Issuer, the Guarantors and Ormat
Nevada.
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"Fleetwood Geothermal Resources Sublease" means that certain
Geothermal Resources Sublease, dated May 31, 1991, between Steamboat
Development, as subtenant, and Fleetwood Corporation, as sublandlord, as amended
by the amendment dated June 11, 1991.
"Fluid Supply Agreement" means that certain Fluid Supply
Agreement, dated December 15, 2003, between Xxxxx and Western States Geothermal
Company.
"FPA" means the Federal Power Act, as amended.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect as of the relevant date of
determination.
"Galena Power Purchaser" means the party purchasing power from
Steamboat Geothermal under the Galena Power Purchase Agreement.
"Galena Power Purchase Agreement" means a power purchase
agreement between ORNI 7 and either Sierra Pacific Power Company or Nevada Power
Company, providing for a price of not less than $.052 kWh (escalating by one
percent (1%) on an annual basis) and containing terms no less favorable than
those set forth under "Description of Our Principal Contracts -- Steamboat
Complex -- Galena Re-powering Documents -- Galena Power Purchase Agreement," in
the Offering Memorandum, including without limitation, the obligation of ORNI 7
to deliver electrical energy in the amounts consistent with an expected
generation based on a nominal net capacity of 18 MW.
"Galena Re-powering" means the upgrading of the Steamboat
Geothermal Plant with the intent to achieve a minimum net electrical output of
18 MW through the replacement of certain equipment at the Steamboat Geothermal
Plant and the possible addition of geothermal resources from the Steamboat
Development Plant.
"Galena Re-powering Account" means the account of such name
created under the Depositary Agreement.
"Galena Re-powering Contract" means the Engineering,
Procurement and Galena Re-powering Contract dated as of the Closing Date between
the Contractor and ORNI 7.
"Galena Re-powering Letter of Credit" means an Acceptable
Letter of Credit having, at all times while such letter of credit is in effect,
an amount available to be drawn that, when added to that amount then on deposit
in the Galena Re-powering Account, is not less than the Galena Re-powering
Requirement at such time.
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"Galena Re-powering Performance Redemption" has the meaning
set forth in Section 3.08(d) of this Indenture.
"Galena Re-powering Requirement" means $19,400,000, or if
amounts have been previously withdrawn from the Galena Re-powering Account
pursuant to the Depositary Agreement the greater of an amount equal to (i)
$19,400,000 less the sum of the amounts that have been previously withdrawn from
the Galena Re-powering Account and (ii) the remaining amount the Independent
Engineer certifies is necessary to achieve the Final Completion Date with
respect to the Galena Re-powering; provided, however, that if additional amounts
are required to be deposited within the Galena Re-powering Account as a result
of this clause (ii), the Issuer shall be permitted to transfer amounts from the
Distribution Suspense Account into the Galena Re-powering Account in order to
satisfy such requirement.
"Geothermal Consultant" means Geothermex, Inc. or another
widely recognized independent geothermal engineering firm retained by the Issuer
as Geothermal Consultant.
"Geothermal Resources Leases" means the Sierra Pacific
Geothermal Resources Lease, the Xxxxxx Geothermal Resources Lease, the Fleetwood
Geothermal Resources Sublease, the Magma Geothermal Resources Lease, the
Mammoth-BLM Geothermal Resources Xxxxx XX 00000, the Mammoth-BLM Geothermal
Resources Xxxxx XX 00000, the Ormesa-BLM Geothermal Resources Lease CA 964, the
Ormesa-BLM Geothermal Resources Lease CA 966, the Ormesa-BLM Geothermal
Resources Lease CA 1903, the Ormesa-BLM Geothermal Resources Lease CA 6217, the
Ormesa-BLM Geothermal Resources Lease CA 6218, the Ormesa-BLM Geothermal
Resources Lease CA 6219, the Ormesa-BLM Geothermal Resources Xxxxx XX 00000, the
Railway Geothermal Resources Lease, the ConAgra Lease, the Xxxxx-BLM Geothermal
Resources Lease N-10922, the Xxxxx-BLM Geothermal Resources Lease N-46566, the
Xxxxx-BLM Geothermal Resources Lease N-40353, and the Xxxxx-BLM Geothermal
Resources Lease N-40355.
"G1 Power Purchase Agreement" means that certain Amended and
Restated Power Purchase and Sales Agreement, dated December 2, 1986, between
Mammoth-Pacific and Southern California Edison, as amended by that certain
Amendment No. 1 to the Amended and Restated Power Purchase and Sales Agreement,
dated May 18, 1990.
"G2 Interconnection Facilities Agreement" means that certain
Interconnection Facilities Agreement, attached to that certain Amendment No. 1 -
Power Purchase Contract as Appendix A, dated October 27, 1989, between
Mammoth-Pacific and Southern California Edison.
"G2 Power Purchase Agreement" means that certain Power
Purchase Contract, dated April 15, 1985, between Mammoth-Pacific and Southern
California Edison, as amended by that certain Amendment No. 1 - Power Purchase
Contract, dated October 27, 1989, and as amended further by that certain
Amendment No. 2 - Power Purchase Contract, dated December 20, 1989.
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"G3 Interconnection Facilities Agreement" means that certain
Interconnection Facilities Agreement, dated October 27, 1989, between
Mammoth-Pacific and Southern California Edison.
"G3 Power Purchase Agreement" means that certain Power
Purchase Contract, dated April 16, 1985, between Mammoth-Pacific (as successor
to Santa Fe Geothermal, Inc.), and Southern California Edison, as amended by
that certain Amendment No. 1 to the Power Purchase Contract, dated October 27,
1989, between Mammoth-Pacific and Southern California Edison and as amended
further by that certain Amendment No. 2 - Power Purchase Contract, dated
December 20, 1989.
"Global Note Legend" means the legend set forth in Exhibit
A-1/A-2 hereto.
"Global Notes" shall mean a Senior Secured Note that evidences
all or part of the Senior Secured Notes and bears the appropriate legend set
forth in Exhibit A-1/A-2 (or such legend as may be contemplated by Section 2.02
for such Senior Secured Notes).
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment for
which the United States pledges its full faith and credit.
"Governmental Approvals" means all governmental approvals,
authorizations, consents, decrees, permits, waivers, privileges and filings with
or from all Governmental Authorities required to be obtained or made for the
ownership, construction, operation and maintenance of a Project.
"Governmental Authority" means the government of any federal,
state, municipal or other political subdivision in which the Projects are
located, and any other government or political subdivision thereof exercising
jurisdiction over the Projects or any of their assets or any party to any of the
Project Documents, including all agencies and instrumentalities of such
governments and political subdivisions.
"Guarantee" means each guarantee by a Guarantor of the
Issuer's obligations under the Financing Documents pursuant to Article IX or
another writing pursuant to which a Guarantor agrees to be bound by the terms
applicable to Guarantors set forth in Article IX.
"Guarantor" means (i) each of Xxxxx, Steamboat Development,
Steamboat Geothermal, OrMammoth, the ORNI Entities and their respective
successors and assigns and (ii) from and after the date of such execution, any
of the Issuer's other direct or indirect Subsidiaries that execute a Guarantee
(including without limitation, in connection with the acquisition of a Qualified
Project) in accordance with the provisions of Sections 4.30 and 4.38 of this
Indenture and their respective successors and assigns.
"Xxxxxx Geothermal Resources Lease" means that certain
Geothermal Resources Lease, dated June 27, 1988 among Steamboat Development,
Xxxxxxx Xxxxxx, Xxxxxx Xxxxxx and
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Xxxxx Xxxxxxxx, as Trustees and Beneficiaries of the Xxxxxx Trust, as amended by
that certain Amendment to Geothermal Resources Lease dated January 1992, and
that certain Second Amendment to Geothermal Resources Lease dated June 25, 1993.
"Hazardous Substance" means any substance, pollutant or
contaminant now or hereafter included in such (or any similar) term under any
state, federal or local ordinance, statute, law or regulation now in effect or
hereafter enacted or amended.
"Holder" means a Person in whose name a Senior Secured Note is
registered in the register maintained pursuant to Section 2.07(a).
"IID Water Supply Agreement" means that certain Amended and
Restated Water Supply Agreement, dated March 6, 1990, between Ormesa (as
successor to Trigor Geothermal Corporation) and the Imperial Irrigation
District.
"Indebtedness" of any Person means, at any date, without
duplication:
(i) all obligations of such Person for borrowed money;
(ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments (excluding "deposit
only" endorsements on checks payable to the order of such Person);
(iii) all obligations of such Person to pay the deferred
purchase price of property or services (except accounts payable and
similar obligations arising in the ordinary course of business shall
not be included herein);
(iv) all obligations of such Person as lessee under capital
leases to the extent required to be capitalized on the books of such
Person in accordance with GAAP;
(v) all obligations of such Person under conditional sale or
other title retention agreements relating to property or assets
purchased by such Person;
(vi) all Indebtedness of others secured by (or for which the
holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property owned or acquired by
such Person, whether or not the obligations secured thereby have been
assumed;
(vii) all obligations of such Person in respect of interest
rate swaps, collars or caps and other interest rate protection
arrangements, foreign currency exchange agreements, commodity exchange,
commodity future, commodity forward or commodity option agreements, or
other interest or exchange rate or commodity hedging arrangements;
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(viii) all obligations of such Person as an account party in
respect of letters of credit and bankers' acceptances; and
(ix) all obligations of others of the type referred to in
clauses (i) through (viii) above guaranteed by such Person, whether or
not secured by a Lien or other security interest on any asset of such
Person.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Independent Consultant" means the Independent Engineer, the
Insurance Consultant and the Geothermal Consultant.
"Independent Engineer" means Stone & Xxxxxxx Management
Consultants, Inc., or another widely recognized independent engineering firm
retained as Independent Engineer by the Issuer.
"Initial Galena Re-powering Withdrawal Conditions" has the
meaning set forth in Section 3.5(d) of the Depositary Agreement.
"Initial Notes" means $190,000,000 in aggregate principal
amount of 8 1/4% Senior Secured Notes due 2020 issued under this Indenture on
the Closing Date.
"Initial Purchaser" means Xxxxxx Brothers Inc.
"Insurance Consultant" means Xxxxx USA, Inc., or its
successors; provided that such successor is another nationally recognized
independent insurance consultant.
"Interconnection Agreements" means the Steamboat 1/1A
Interconnection Agreement, Steamboat 2/3 Interconnection Agreement, the Mammoth
Interconnection Facilities Agreements, the Ormesa Interconnection Agreements,
and the Xxxxx/Desert Peak 1 Interconnection Agreement.
"Interest Payment Date" means each June 30 and December 30
commencing June 30, 2004 and concluding on the Final Maturity Date.
"Investment Grade" means a rating of Baa3 or better by Xxxxx'x
and BBB- or better by S&P (or an equivalent rating by another nationally
recognized credit rating agency if one or more of such corporations are not in
the business of rating long-term obligations of commercial banks at the time of
issuance); provided, that such rating is not on review for possible downgrade or
on negative watch by any such agency.
"Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course
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of business), purchases or other acquisitions for consideration of Indebtedness,
Capital Stock or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
"Kilowatt" or "KW" means one thousand xxxxx.
"Kilowatt-hours" or "kWh" means a unit of electrical energy
equal to one kilowatt of energy supplied or taken from an electric circuit
steadily for one hour.
"Letter of Credit" means the Debt Service Reserve Letter of
Credit, the Galena Re-powering Letter of Credit or the Ormesa Repayment Letter
of Credit, as the case may be.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Issuer and sent to all Holders of the Initial Notes and
Additional Notes for use by such Holders in connection with the Exchange Offer.
"Lien" means any mortgage, pledge, hypothecation, assignment,
mandatory deposit arrangement, encumbrance, security interest, charge, lien
(statutory or other), preference, priority or other collateral agency agreement
of any kind or nature whatsoever which has the substantial effect of
constituting a security interest, including, without limitation, any conditional
sale or other title retention agreement, any financing lease having
substantially the same effect as any of the foregoing and the filing of any
financing statement or similar instrument under the Uniform Commercial Code or
comparable law of any jurisdiction, domestic or foreign.
"Liquidated Damages" means all liquidated damages then owing
pursuant to Section 5 of the Registration Rights Agreement.
"Loss Proceeds" means all proceeds from an Event of Loss
received by the Issuer or any Guarantor, including, without limitation,
insurance proceeds or other amounts actually received, except proceeds of
business interruption insurance.
"Magma Geothermal Resources Lease" means that certain
Geothermal Lease, dated August 31, 1983, between Mammoth-Pacific and Magma Power
Company, as amended by amendments dated April 30, 1987, January 1, 1990, and
April 12, 1991.
"Make-Whole Premium" means a premium equal to the excess, if
any, of (a) the present value of all scheduled principal and interest payments
on all Senior Secured Notes to be redeemed (discounted at a rate equal to the
yield to maturity of U.S. Treasury securities having an average life equal to
the Remaining Average Life of the Senior Secured Notes, plus 50 basis points)
over (b) the principal amount of the Senior Secured Notes to be redeemed.
"Mammoth-BLM Geothermal Resources Xxxxx XX 00000" means that
certain Geothermal Resources Xxxxx XX 00000, dated March 1, 0000, xxxxxxx
Xxxxxxx-Xxxxxxx xxx xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land
Management of the Department of the Interior.
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"Mammoth-BLM Geothermal Resources Xxxxx XX 00000" means that
certain lease for Geothermal Resources XX 00000, dated February 1, 0000, xxxxxxx
Xxxxxxx-Xxxxxxx xxx xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land
Management of the Department of the Interior.
"Mammoth-BLM Site License" means that certain License for
Electric Power Xxxxx Xxxx XX 00000, dated July 26, 0000, xxxxxxx Xxxxxxx-Xxxxxxx
xxx xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the
Department of the Interior.
"Mammoth Enhancement" means the investment in additional
equipment and other enhancements at the Mammoth Project that are designed to
increase output at the Mammoth Plant by 3.6 MW.
"Mammoth Enhancement Redemption" has the meaning set forth in
Section 3.08(e) of this Indenture.
"Mammoth Interconnection Facilities Agreements" means the G2
Interconnection Facilities Agreement and the G3 Interconnection Facilities
Agreement.
"Mammoth Operation and Maintenance Agreement" means that
certain Plant Operating Services Agreement, dated January 1, 1995, between Ormat
Nevada (as successor to Pacific Power Plant Operations) and Mammoth-Pacific.
"Mammoth-Pacific" means Mammoth-Pacific, L.P. (California), a
California limited partnership.
"Mammoth-Pacific LP Agreement" means that certain Amended and
Restated Agreement of Limited Partnership of Mammoth-Pacific dated January 26,
1990, among CD Mammoth Lakes I, Inc., CD Mammoth Lakes II, Inc. and OrMammoth,
as amended by the amendment dated June 13, 1995.
"Mammoth Plant" means the three geothermal power generating
plants, denominated the G1, G2 and G3 plants located in Mammoth Lakes,
California that are owned by Mammoth-Pacific (and in which OrMammoth has a 50%
partnership interest) and having a gross generating capacity of 35 MW.
"Mammoth Power Purchase Agreements" means the G1 Power
Purchase Agreement, the G2 Power Purchase Agreement and the G3 Power Purchase
Agreement.
"Material Adverse Effect" means a material adverse effect on
(i) the Issuer's or any of the Issuer's Subsidiaries' results of operations or
financial condition (taken as a whole), (ii) the validity or priority of the
Liens on the Collateral or Guarantees, (iii) the Issuer's or any of the Issuer's
Subsidiaries' ability (taken as a whole) to observe and perform any of the
Issuer's or any of the Issuer's Subsidiaries' material obligations under the
Transaction Documents to which the Issuer or any of the Issuer's Subsidiaries is
a party or (iv) the ability of the
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Trustee or the Collateral Agent to enforce any of the payment or other material
obligations of the Issuer, any Guarantor or Ormat Nevada under the Financing
Documents to which the Issuer, the Guarantors or Ormat Nevada are parties, as
the case may be.
"Material Project Documents" means the Power Purchase
Agreements, the Operation and Maintenance Agreements, the Interconnection
Agreements, the Geothermal Resources Leases, the Site Licenses, the
Mammoth-Pacific LP Agreement, the IID Water Supply Agreement, the Fluid Supply
Agreement, the Desert Peak Sublease, the Xxxxx Settlement Agreement, the Galena
Re-powering Contract and any Additional Project Document.
"Megawatt" or "MW" means one million xxxxx.
"Megawatt-hours" or "MWh" means one thousand KWh.
"Meyburg Geothermal Resources Lease" means that certain
Geothermal Resources Lease, between ORNI 7, as lessee, and ORNI 6, as lessor.
"Moody's" means Xxxxx'x Investors Service, Inc., a corporation
organized and existing under the laws of the State of Delaware, its successors
and assigns.
"Net Available Amount" means, with respect to any proceeds,
such proceeds net of the related Collection Expenses.
"Note Purchase Agreement" means the Note Purchase Agreement
among the Issuer, the Guarantors and the Initial Purchaser for the sale and
purchase of the Senior Secured Notes.
"Offering" means the offering of the Senior Secured Notes
described herein.
"Offering Memorandum" means that certain offering memorandum
dated February 6, 2004, relating to the offer of the Senior Secured Notes for
sale.
"Officer's Certificate" means a certificate signed by the
Issuer's Authorized Representative.
"OG I Plant Connection Agreement" means that certain Plant
Connection Agreement for the Ormesa Geothermal Plant, dated October 1, 1985,
between Ormesa (as successor to Ormesa Geothermal) and the Imperial Irrigation
District.
"OG I Power Purchase Agreement" means that certain Power
Purchase Contract, dated July 18, 1984, between Ormesa (as successor to Republic
Geothermal, Inc.) and Southern California Edison, as amended by that certain
Amendment No. 1 to the Power Purchase Contract, dated December 23, 1988, between
Ormesa (as successor to Ormesa Geothermal) and Southern California Edison.
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"OG I Transmission Service Agreement" means that certain
Transmission Service Agreement for the Ormesa I, Ormesa IE and Ormesa IH
Geothermal Power Plants, dated October 3, 1989, between Ormesa (as successor to
Ormesa Geothermal) and the Imperial Irrigation District.
"OG IE Plant Connection Agreement" means that certain Plant
Connection Agreement for the Ormesa IE Geothermal Power Plant, dated October 21,
1988, between Ormesa (as successor to Ormesa IE) and the Imperial Irrigation
District.
"OG IH Plant Connection Agreement" means that certain Plant
Connection Agreement for the Ormesa IH Geothermal Power Plant, dated October 3,
1989, between Ormesa (as successor to Ormesa IH) and the Imperial Irrigation
District.
"OG II Plant Connection Agreement" means that certain Plant
Connection Agreement for the Ormesa Geothermal Plant No. 2, dated May 26, 1987,
between Ormesa (as successor to Ormesa Geothermal II) and the Imperial
Irrigation District.
"OG II Power Purchase Agreement" means that certain Power
Purchase Contract, dated June 13, 1984, between Ormesa (as successor to Ormat
Systems Inc.) and Southern California Edison.
"OG II Transmission Service Agreement" means that certain
Transmission Service Agreement for the Ormesa II Geothermal Power Plant, dated
August 25, 1987, between Ormesa (as successor to Ormesa Geothermal II) and the
Imperial Irrigation District.
"Operating and Maintenance Expenses" means, for any period,
all amounts disbursed by or on behalf of the Issuer or any Subsidiary of the
Issuer in such period for operation, maintenance, administration, repair (other
than repair done in response to a casualty event), or improvement of a Project,
including, without limitation, premiums on insurance policies, property and
other taxes, litigation expenses and costs, payments under leases, royalty and
other land use agreements, and fees, expenses, and any other payments required
under the Project Documents; provided, "Operating and Maintenance Expenses"
shall not include (i) any payment made in respect of the Financing Documents or
with respect to any Indebtedness, (ii) any payment or dividends or other
distributions to Ormat Nevada or any of the Issuer's other Affiliates other than
payments under Project Documents, (iii) any tax paid or payable by any of the
Issuer's direct or indirect equity owners with respect to the Issuer's income or
receipts or (iv) any amounts for construction related to the Galena Re-powering.
"Operating Budget" means the annual budget of Operating and
Maintenance Expenses for the Projects, as prepared in good faith by the Issuer
for each fiscal year, or part thereof, of the Issuer, showing such costs by
category and, where applicable, by Project.
"Operating Subsidiaries" means all of the Issuer's
Subsidiaries other than OrMammoth unless OrMammoth purchases the partnership
interests of Mammoth-Pacific it does not currently own.
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"Operation and Maintenance Agreements" means the Steamboat
Complex Operation and Maintenance Agreement, the Mammoth Operation and
Maintenance Agreement, the Ormesa Operation and Maintenance Agreement, and the
Xxxxx Operation and Maintenance Agreement.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
10.05 hereof. The counsel may be an employee of or counsel to the Issuer, any
Affiliate of the Issuer or the Trustee.
"Organizational Documents" means as to any Person, the
articles of incorporation, by laws, partnership agreement, limited liability
company agreement, operating agreement or other organizational or governing
documents of such Person.
"OrMammoth" means OrMammoth Inc., a Delaware corporation.
"Ormat Nevada" means Ormat Nevada Inc., a Delaware
corporation.
"Ormat Nevada Subordinated Loan" means a subordinated Credit
Agreement between the Issuer and Ormat Nevada that constitutes Subordinated
Debt.
"Ormat Technologies" means Ormat Technologies, Inc., a
Delaware corporation.
"Ormesa" means Ormesa LLC, a Delaware limited liability
company.
"Ormesa-BLM Geothermal Resources Lease CA 964" means the
Geothermal Resources Lease CA 964, dated September 1, 1974, between Ormesa and
the United States of America through the Bureau of Land Management of the
Department of the Interior.
"Ormesa-BLM Geothermal Resources Lease CA 966" means the
Geothermal Resources Lease CA 966, dated August 1, 1974, between Ormesa and the
United States of America through the Bureau of Land Management of the Department
of the Interior.
"Ormesa-BLM Geothermal Resources Lease CA 1903" means the
Geothermal Resources Lease CA 1903, dated September 1, 1974, between Ormesa and
the United States of America through the Bureau of Land Management of the
Department of the Interior.
"Ormesa-BLM Geothermal Resources Lease CA 6217" means the
Geothermal Resources Lease CA 6217, dated July 1, 1979, between Ormesa and the
United States of America through the Bureau of Land Management of the Department
of the Interior.
"Ormesa-BLM Geothermal Resources Lease CA 6218" means the
Geothermal Resources Lease CA 6218, dated July 1, 1979, between Ormesa and the
United States of America through the Bureau of Land Management of the Department
of the Interior.
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"Ormesa-BLM Geothermal Resources Lease CA 6219" means the
Geothermal Resources Lease CA 6219, dated July 1, 1979, between Ormesa and the
United States of America through the Bureau of Land Management of the Department
of the Interior.
"Ormesa-BLM Geothermal Resources Xxxxx XX 00000" means the
Geothermal Resources Xxxxx XX 00000, dated July 1, 0000, xxxxxxx Xxxxxx xxx xxx
Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the Department
of the Interior.
"Ormesa-BLM Xxxx Xxxxxxx XX 00000" means that certain License
for Electric Power Xxxxx Xxxx XX 00000, dated August 21, 0000, xxxxxxx Xxxxxx
xxx xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the
Department of the Interior.
"Ormesa-BLM Xxxx Xxxxxxx XX 00000" means that certain License
for Electric Power Xxxxx Xxxx XX 00000, dated July 21, 0000, xxxxxxx Xxxxxx xxx
xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the
Department of the Interior.
"Ormesa-BLM Xxxx Xxxxxxx XX 00000" means that certain License
for Electric Power Xxxxx Xxxx XX 00000, dated July 24, 0000, xxxxxxx Xxxxxx xxx
xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the
Department of the Interior.
"Ormesa-BLM Xxxx Xxxxxxx XX 00000" means that certain License
for Electric Power Xxxxx Xxxx XX 00000, dated June 7, 0000, xxxxxxx Xxxxxx xxx
xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the
Department of the Interior.
"Ormesa-BLM Xxxx Xxxxxxx XX 00000" means that certain License
for Electric Power Xxxxx Xxxx XX 00000, dated September 18, 0000, xxxxxxx Xxxxxx
xxx xxx Xxxxxx Xxxxxx xx Xxxxxxx through the Bureau of Land Management of the
Department of the Interior.
"Ormesa Credit Agreement" means the Credit Agreement dated
December 31, 2002 among Ormesa, United Capital as Administrative Agent and
Collateral Agent, and the lenders party thereto from time to time.
"Ormesa Interconnection Agreements" means the Consolidated OG
I Plant Connection Agreements, the OG I Transmission Service Agreement, the OG
II Plant Connection Agreement and the OG II Transmission Service Agreement.
"Ormesa Loan Repayment Account" means the account of such name
created under the Depositary Agreement.
"Ormesa Operation and Maintenance Agreement" means that
certain Operation and Maintenance Agreement, dated April 15, 2002, between
Ormesa and Ormat Nevada.
"Ormesa Plant" means the six geothermal power generating
plants located in East Mesa, Imperial Valley, California, owned by Ormesa and
having a gross generating capacity of 94 MW.
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"Ormesa Power Purchase Agreements" means the OG I Power
Purchase Agreement and the OG II Power Purchase Agreement.
"Ormesa Repayment Letter of Credit" means an Acceptable Letter
of Credit having, at all times such letter of credit is in effect, an amount
available to be drawn that, when added to the amount of cash then on deposit in
the Ormesa Loan Repayment Account, is in an amount not less than the Ormesa
Repayment Requirement.
"Ormesa Repayment Requirement" means an amount equal to
$15,500,000, which is equal to the aggregate principal amount outstanding under
the Ormesa Credit Agreement on the Closing Date less cash on deposit in the
"debt service reserve account" under the Ormesa Credit Agreement and amounts
actually repaid under the Ormesa Credit Agreement in 2004; provided, however,
that with respect to the aggregate principal amount paid on September 30, 2004,
such amount shall not be reduced to an amount less than 102% of the remaining
aggregate principal amount outstanding under the Ormesa Credit Agreement less
cash on deposit in the "debt service reserve account" under the Ormesa Credit
Agreement on such date.
"Ormesa Support Date" means the earliest to occur of (i)
January 31, 2005; (ii) any other date as of which the amount payable in respect
of the Ormesa Credit Agreement has been paid in full; and (iii) any other date
as of which Ormesa is no longer prohibited from granting liens pursuant to the
Ormesa Credit Agreement.
"ORNI 6" means ORNI 6 LLC, a Delaware limited liability
company.
"ORNI 7" means ORNI 7 LLC, a Delaware limited liability
company.
"ORNI Entities" means ORNI 1 LLC, a Delaware limited liability
company, ORNI 2 LLC, a Delaware limited liability company and ORNI 7.
"Outstanding" in connection with the Senior Secured Notes,
means, as of the time in question, all Senior Secured Notes authenticated and
delivered under this Indenture, except (i) Senior Secured Notes theretofore
canceled or required to be canceled under this Indenture; (ii) Senior Secured
Notes for which provision for payment shall have been made in accordance with
this Indenture; and (iii) Senior Secured Notes in substitution for which other
Senior Secured Notes have been authenticated and delivered pursuant to this
Indenture.
"Overdue Principal" shall mean, as of any Payment Date, all
principal of any Senior Secured Note which has become due and payable and not
been punctually paid or duly provided for when and as due and payable, whether
as a result of insufficient available funds or otherwise.
"Paying Agent" has the meaning set forth in Section 2.07(a) of
this Indenture.
"Payment Date" means any Interest Payment Date or Principal
Payment Date.
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"Performance Guarantee Tests" means the performance tests
conducted in accordance with the Galena Re-powering Contract to demonstrate and
verify that the Steamboat Geothermal Facility has satisfied the Performance
Guarantees and certain other performance criteria.
"Performance Guarantees" has the meaning given in the Galena
Re-powering Contract.
"Performance Liquidated Damages" means the liquidated damages
payable by the Contractor to Steamboat Geothermal pursuant to the Galena
Re-powering Contract as a consequence of the failure of the Steamboat Geothermal
Facility to meet certain of the Performance Guarantees.
"Permitted Additional Senior Lender" means a holder of any
Senior Secured Obligations other than the Senior Secured Notes.
"Permitted Indebtedness" has the meaning set forth in Section
4.18 of this Indenture.
"Permitted Investments" means an investment in any of the
following: (i) direct obligations of the Department of the Treasury of the
United States of America; (ii) obligations of any federal agencies which
obligations are backed by the full faith and credit of the United States of
America; (iii) commercial paper rated in any one of the two highest rating
categories by Moody's or S&P; (iv) investment agreements with banks (foreign and
domestic), broker/dealers, and other financial institutions rated at the time of
bid in any one of the three highest rating categories by Moody's and S&P; (v)
repurchase agreements with banks (foreign and domestic), broker/dealers, and
other financial institutions rated at the time of bid in any one of the three
highest rating categories by Moody's and S&P, provided, that (1) collateral is
limited to the securities specified in clauses (i) and (ii) above, (2) the
margin levels for collateral must be maintained at a minimum of 102% including
principal and interest, (3) the Collateral Agent shall have a first priority
perfected security interest in the collateral, (4) the collateral will be
delivered to a third party custodian, designated by the Issuer, acting for the
benefit of the Collateral Agent and all fees and expenses related to collateral
custody will be the responsibility of the Issuer, (5) the collateral must have
been or will be acquired at the market price and marked to market weekly and
collateral level shortfalls cured within 24 hours and (6) unlimited right of
substitution of collateral is allowed provided that substitution collateral must
be permitted collateral substituted at a current market price and substitution
fees of the custodian shall be paid by the Issuer; (vi) forward purchase
agreements delivering securities specified in clauses (i) and (iii) above with
banks (foreign and domestic), broker/dealers, and other financial institutions
maintaining a long-term rating on the day of bid no lower than investment grade
by both S&P and Moody's (such rating may be at either the parent or subsidiary
level); and (vii) money market funds rated "AAAm" or "AAAm-G" or better by S&P.
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"Permitted Liens" means (a) the rights and interests of the
Collateral Agent and any other Secured Party as provided in the Financing
Documents; (b) Liens for any tax, either secured by a bond or other reasonable
security or not yet due or being contested in good faith and by appropriate
proceedings, so long as (i) such proceedings shall not involve any substantial
danger of the sale, forfeiture or loss of the Projects, the sites of the Project
or any easements, as the case may be, title thereto or any interest therein and
shall not interfere in any material respect with the use of any Project, any
Project sites or any easements, (ii) a bond or other reasonable security has
been posted or provided in such manner and amount as to assure that any taxes
determined to be due will be promptly paid in full when such contest is
determined or (iii) adequate reserves have been provided therefor to the extent
required by and in accordance with GAAP; (c) materialmen's, mechanics',
workers', repairmen's, employees' or other like Liens, arising in the ordinary
course of business or in connection with the development, construction,
operation and/or maintenance of any Project, either for amounts not yet due or
for amounts being contested in good faith and by appropriate proceedings so long
as (i) the Issuer reasonably determines that such proceedings shall not involve
any substantial danger of the sale, forfeiture or loss of any Project, any
Project sites or any easements, as the case may be, title thereto or any
interest therein and shall not interfere in any material respect with the use or
disposition of any Project, any Project sites or any easements, or (ii) a bond
or adequate cash reserves have been provided therefor to the extent required by
and in accordance with GAAP; (d) Liens arising out of judgments or awards so
long as enforcement of such Lien has been stayed and an appeal or proceeding for
review is being prosecuted in good faith and for the payment of which adequate
reserves, bonds or other reasonable security have been provided or are fully
covered by insurance; (e) title exceptions as reflected in the Title Policies
other than delinquent taxes and monetary liens which are to be paid on the
Closing Date; (f) Liens, deposits or pledges to secure statutory obligations;
(g) Liens, deposits or pledges to secure performance of bids, tenders, contracts
(other than for the repayment of borrowed money) or leases, or for purposes of
like general nature in the ordinary course of its business, not to exceed $5
million in the aggregate at any time, and with any such Lien to be released as
promptly as practicable; (h) other Liens incident to the ordinary course of
business that are not incurred in connection with the obtaining of any loan,
advance or credit and that do not in the aggregate materially impair the use of
the Issuer's or the Issuer's Subsidiaries' property or assets or the value of
such property or assets for the purposes of such business; (i) involuntary Liens
as contemplated by the Financing Documents and the Project Documents (including
a lien of an attachment or execution) securing a charge or obligation on any of
the Issuer's property, either real or personal, whether now or hereafter owned,
in the aggregate sum of less than $3 million; (j) until the Ormesa Support Date,
the Liens in favor of the lenders under the Ormesa Credit Agreement; and (k)
servitudes, easements, rights-of-way, restrictions, minor defects or
irregularities in title and such other encumbrances or charges against real
property or interests therein as of a nature generally existing with respect to
properties of similar character and which do not in a material way interfere
with the value or use thereof or the Issuer's business.
"Person" means any individual, sole proprietorship,
corporation, partnership, joint venture, limited liability partnership, limited
liability company, trust, unincorporated association, institution, Governmental
Authority or any other entity.
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"Place of Payment" when used with respect to the Senior
Secured Notes, shall mean the office or agency maintained pursuant to Section
4.02.
"Plants" means the Xxxxx Plant, the Ormesa Plant, the
Steamboat Geothermal Plant, the Steamboat Development Plant, the Mammoth Plant
and geothermal power generating facilities acquired after the Closing Date that
constitute Qualified Projects.
"Pledge and Security Agreements" means each of the Pledge and
Security Agreements, to be executed by the Issuer, each of the Guarantors and
the Collateral Agent.
"Power Purchase Agreements" means the Steamboat 1 Plant Power
Purchase Agreement, the Steamboat 1A Plant Power Purchase Agreement, the
Steamboat 2/3 Project Power Purchase Agreements, the Galena Power Purchase
Agreement, the Mammoth Power Purchase Agreements, the Ormesa Power Purchase
Agreements, the Xxxxx Project Power Purchase Agreement and any power purchase
agreements relating to a Qualified Project at the time such Qualified Project is
acquired by the Issuer or a Guarantor.
"Predecessor Notes" with respect to any particular Senior
Secured Note, shall mean any previous Senior Secured Note evidencing all or a
portion of the same debt as that evidenced by such particular Senior Secured
Note; for the purposes of this definition, any Senior Secured Note authenticated
and delivered pursuant to Section 2.08 in lieu of a lost, destroyed or stolen
Senior Secured Note shall be deemed to evidence the same debt as the lost,
destroyed or stolen Senior Secured Note.
"Principal Payment Date" when used with respect to any Senior
Secured Obligations means the date on which all or a portion of the principal of
such Senior Secured Obligations become due and payable as provided in this
Indenture or any other agreement governing such Senior Secured Obligations,
whether on a scheduled date for payment of principal, on a Redemption Date, the
Final Maturity Date, a date of declaration of acceleration, or otherwise.
"Private Placement Legend" means the legend referenced in
Section 2.02 to be placed on all Senior Secured Notes issued under this
Indenture except where otherwise permitted by the provisions of this Indenture.
"Project" means each Plant together with the related Project
Documents, governmental approvals relating to the Plant or Project Documents,
and any other item relating to the Plant, including any improvements to, and the
operation of the Plant and all activities related thereto.
"Project Costs" means, with respect to the Galena Re-powering,
without duplication, all costs and expenses paid, incurred or to be incurred by
Steamboat Geothermal to complete the development, design, engineering,
acquisition, construction, assembly, inspection, testing, completion and
start-up of the Galena Re-powering in the manner contemplated under the Galena
Re-powering Contract, including, without limitation, (i) Operating and
Maintenance
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Expenses of the Galena Re-powering prior to Final Acceptance, (ii) amounts
payable in respect of options for, or the granting of, necessary easements,
(iii) amounts payable in respect of obtaining or maintaining Governmental
Approvals, and (iv) amounts payable in respect of acquiring initial spare parts.
"Project Documents" means the Material Project Documents and
any additional agreements relating to the Projects.
"Projections" means certain projections at the Closing Date of
the Projects' revenues and the costs associated therewith including certain
assumptions by the Issuer.
"Prudent Industry Practices" shall mean, at a particular time,
(i) any of the practices, methods and acts engaged in or approved by a
significant portion of the electricity generating industry operating in the
United States at such time, or (ii) with respect to any matter to which clause
(i) does not apply, any of the practices, methods and acts which, in the
exercise of reasonable judgment at the time the decision was made, could have
been expected to accomplish the desired result at a reasonable cost consistent
with good business practices, reliability, safety and expedition. "Prudent
Industry Practice" is not intended to be limited to the optimum practice, method
or act to the exclusion of all others, but rather to be a spectrum of possible
practices, methods or acts having due regard for, among other things,
manufacturers' warranties and the requirements of any Governmental Authority of
competent jurisdiction.
"PUHCA" means the Public Utility Holding Company Act of 1935,
as amended.
"Punch List Items" means those items which must be completed
by the Contractor under the Galena Re-powering Contract after achieving the
Final Acceptance Date, performance of which will not interrupt, disrupt or
interfere to any significant extent with the operation of the Steamboat
Geothermal Facility.
"QIB means a "qualified institutional buyer" as defined in
Rule 144A.
"Qualified Project" means a (a) a fully constructed and
operational geothermal power plant located within the United States of America
(other than the Mammoth Project), (b) as to which electricity will be sold under
long-term power purchase agreements that have been approved by the applicable
public utility commission or similar governmental body with a counterparty that
has a long-term issuer rating of not less than BBB- by S&P and Baa3 by Moody's
and (c) is acquired by the Issuer or a Guarantor and the Collateral Agent is
granted a first priority pledge of all of the Capital Stock of any Guarantor
that acquires such Qualified Project or the Guarantor acquiring such Qualified
Project provides a first priority lien with respect to collateral with respect
to such Qualified Project that is consistent with that set forth under the
second paragraph of "Description of the Notes--Security" in the Offering
Memorandum.
"Qualifying Facility" means a facility which is a qualifying
facility within the meaning of the Public Utility Regulatory Policies Act of
1978 (and all rules and regulations
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adopted thereunder) and which meets the criteria defined in Title 18, Code of
Federal Regulations, Sections 292.201 through 292.207.
"Quarterly Period" means each calendar quarter; provided,
however, that the first Quarterly Period shall commence on the Closing Date and
shall end on March 31, 2004.
"Railway Geothermal Resources Lease" means that certain
Geothermal Resource Lease (SPL-6292), dated October 10, 1984, between Xxxxx, as
tenant, and The Burlington Northern and Santa Fe Railway Company, as landlord,
as amended by the amendment dated December 5, 1991.
"Redemption Account" means the account of such name created
under the Depositary Agreement.
"Redemption Date" means the date on which the Issuer redeems
or shall redeem any Senior Secured Notes in accordance with this Indenture.
"Registrar" has the meaning specified in Section 2.07(a).
"Registration Default" has the meaning set forth in Section 5
of the Registration Rights Agreement.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Closing Date, by and among the Issuer and the
Guarantors and the other parties named on the signature pages thereof, as such
agreement may be amended, modified or supplemented from time to time and, with
respect to any Additional Notes, one or more registration rights agreements
among the Issuer and the Guarantors and the other parties thereto, as such
agreements may be amended, modified or supplemented from time to time, relating
to rights given by the Issuer to the purchasers of Additional Notes to register
such Additional Notes under the Securities Act.
"Regular Record Date" for the interest or principal payable on
any Payment Date on the Senior Secured Notes means the date specified for that
purpose as contemplated by Section 2.09 (whether or not a Business Day).
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Note" means the Temporary Regulation S
Global Note or the Regulation S Unrestricted Global Note, as applicable.
"Regulation S Unrestricted Global Note" has the meaning
specified in Section 2.01.
"Related Party" means (a) Ormat Industries, Ltd. and Ormat
Technologies, Inc., (b) any direct or indirect controlling stockholder or
controlling member or a more than 50%
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owned subsidiary of Ormat Nevada or (c) any trust, corporation, partnership,
limited liability company or other entity, of which the beneficiaries,
stockholders, partners, members or Persons holding more than a 50% controlling
interest are Ormat Nevada and/or such other Persons referred to in the
immediately preceding clause (a) or (b).
"Remaining Average Life" means, with respect to any Senior
Secured Note, the principal of which is to be redeemed (the "Called Principal"),
the number of years (calculated to the nearest one-twelfth year) obtained by
dividing (i) such Called Principal into (ii) the sum of the products obtained by
multiplying (a) the principal component of each Remaining Scheduled Payment (as
defined below) with respect to such Called Principal by (b) the number of years
(calculated to the nearest one-twelfth year) that will elapse between the date
on which such Called Principal is to be redeemed (the "Settlement Date") and the
scheduled due date of such Remaining Scheduled Payment. For purposes of this
definition, the term "Remaining Scheduled Payments" means, with respect to the
Called Principal of any Senior Secured Note, all payments of such Called
Principal and interest thereon that would be due after the Settlement Date with
respect to such Called Principal if no payment of such Called Principal were
made prior to its scheduled due date.
"Renewable Energy Credits" means all renewable energy credits,
offsets or other benefits allocated, assigned or otherwise awarded or certified
to the Issuer or any of the Issuer's Subsidiaries by any Governmental Authority
in connection with any of the Projects; provided, that the foregoing shall not
include any federal, state, and/or local production tax credits and/or
investment tax credits specific to investments in renewable energy production
and delivery facilities (if any) or any environmental credits, offsets, or other
similar benefits allocated, assigned or otherwise awarded to the Issuer or any
of the Issuer's Subsidiaries by any Governmental Authority or received in any
other manner based in whole or in part on the fact that any of the Projects
constitutes a "renewable energy system" (as defined under any Applicable Law) or
the like, including emissions credits or allowances, such as credits available
because such Project does not produce carbon dioxide or other emissions when
generating electric energy.
"Required Holders" means, at any time, Persons that at such
time hold not less than 51% in aggregate principal amount of the Outstanding
Senior Secured Notes.
"Resource Lease Consents" means (i) with respect to ORNI 1,
LLC, ORNI 2, LLC, and Xxxxx the consents of each of Xxxxx X. Xxxxx, Xxxxxxx
Xxxxx and Xxxxxx Xxxxx, and Xxxxx X. Xxxxxxx, Trustee of the Xxxxx X. Xxxxxxx
Revocable Trust dated August 24, 1996 under the Grant of Easement Agreement,
dated March 27, 1998; and of The Burlington Northern and Santa Fe Railway
Company under the Railway Geothermal Resources Lease, and (ii) with respect to
ORNI 7, LLC and Steamboat Development the consents of each of Fleetwood
Corporation under the Fleetwood Geothermal Resources Lease; Xxxxxxx X. Xxxxx and
the Trust of Xxxxxxx X. Xxxxx under a geothermal resources lease dated May 31,
1991; and Xxxxxxx Xxxxxx, Xxxxxx Xxxxxx, and Xxxxx Xxxxxxxx, Trustees and
Beneficiaries of the Xxxxxx Trust under the Xxxxxx Geothermal Resources Lease.
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"Responsible Officer" means, with respect to knowledge of any
default under this Indenture, the chief executive officer, president, chief
financial officer, general counsel, principal accounting officer, treasurer,
assistant treasurer, or any vice president of the Issuer, or other officer of
the Issuer who in the normal performance of his or her operational duties would
have knowledge of the subject matter relating to such default.
"Responsible Trust Officer" means, when used with respect to
the Trustee, the Depositary or the Collateral Agent, any officer within the
Corporate Trust Office of the Trustee, the Depositary or the Collateral Agent
(or any successor group of the Trustee, Depositary or Collateral Agent, as
applicable) including any Managing Director, Principal, Vice President,
Assistant Vice President, Secretary, Assistant Secretary, Treasurer, Assistant
Treasurer, Controller, General Counsel, Associate Corporate Counsel or any other
officer of the Trustee, the Depositary or the Collateral Agent customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
"Restoration Sub-Account" means one or more accounts of such
name created under the Depositary Agreement in connection with an Event of Loss
or Event of Eminent Domain.
"Restricted Global Note" has the meaning set forth in Section
2.01 hereto.
"Restricted Note" has the meaning specified in Section 2.02.
"Restricted Payment" means, with respect to any Person, (i)
the declaration and payment of distributions, dividends or any other payment
made in cash, property, obligations or other notes, (ii) any payment of the
principal of, or interest or premium, if any, on, any Subordinated Debt, (iii)
the making of any loans or advances to any Affiliate (other than Permitted
Indebtedness), (iv) any purchase, redemption, acquisition or retirement for
value (including, without limitation in connection with any merger or
consolidation of the Issuer) of any of the Issuer's Capital Stock or (v) any
Investment in any Person other than a Guarantor; provided, however, that the
term "Restricted Payments" shall not include (v) proceeds of this offering in
the amount of $78,500,000 utilized for the acquisition of Steamboat Development,
$33,500,000 utilized for the acquisition of a 50% interest in Mammoth-Pacific
and the repayment of $14,500,000 due to Ormat Nevada, (w) cash released from any
Account as a result of the provision of an Acceptable Letter of Credit as
provided for in the Financing Documents, (x) cash released from the Ormesa Loan
Repayment Account as permitted under Section 3.7(b) of the Depositary Agreement,
(y) payments made to any Affiliate of such Person for goods and services
purchased or procured in accordance with the terms of this Indenture or (z) the
use of proceeds from Indebtedness incurred in accordance with (I) clause (b)(y)
under Section 4.18 hereof to purchase that portion of the of the Capital Stock
of Mammoth-Pacific that the Issuer does not own as of the Closing Date or (II)
clause (h) under Section 4.18 hereof to purchase a Qualified Project.
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"Restricted Period" has the meaning set forth in Section 2.01.
"Revenue Account" means the account of such name created under
the Depositary Agreement.
"Rule 144" means Rule 144 promulgated under the Securities
Act.
"Rule 144A" means Rule 144A promulgated under the Securities
Act.
"Rule 144A Global Note" means restricted, permanent global
notes in fully registered form issued to qualified institutional buyers under
Rule 144A.
"Rule 903" means Rule 903 promulgated under the Securities
Act.
"Rule 904" means Rule 904 promulgated under the Securities
Act.
"Scheduled Payment Date" means each June 30 and December 30,
commencing on June 30, 2004 and ending on December 30,
2020.
"SEC" means the United States Securities and Exchange
Commission.
"Secured Parties" means the Trustee, the Holders, the
Collateral Agent, the holders of additional Permitted Indebtedness (other than
Permitted Indebtedness of the type described in clause (vi) in the definition
thereof), in each case to the extent such party (or an agent on such party's
behalf) is or becomes a party to the Collateral Agency Agreement.
"Securities Act" means the United States Securities Act of
1933, as amended.
"Securities Intermediary" means Union Bank of California,
N.A., until a successor replaces it in accordance with the applicable provisions
of the Depositary Agreement and thereafter means the successor serving
thereunder in such capacity.
"Security Documents" means, collectively, the Depositary
Agreement, the Deeds of Trust, the Collateral Agency Agreement, the Pledge and
Security Agreements, the Control Agreements, the Third Party Consents and any
other document providing for any lien of the Secured Parties, pledge,
encumbrance, mortgage or security interest on any or all of the Issuer's assets
or the ownership interests thereof or the Issuer's Subsidiaries' assets and the
ownership interests thereof.
"Senior Secured Notes" means the Initial Notes and, unless the
context otherwise requires, the Additional Notes including any Exchange Notes.
"Senior Secured Obligations" means, collectively, without
duplication: (i) all of the Issuer's Indebtedness, financial liabilities and
obligations, of whatsoever nature and however evidenced (including, but not
limited to, principal, interest, premium, fees, reimbursement
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obligations, penalties, indemnities and legal and other expenses, whether due
after acceleration or otherwise) to the Secured Parties in their capacity as
such under the applicable Financing Document or any other agreement, document or
instrument evidencing, securing or relating to such Indebtedness, financial
liabilities or obligations, in each case, direct or indirect, primary or
secondary, fixed or contingent, now or hereafter arising out of or relating to
any such agreements; (ii) any and all sums advanced by the Collateral Agent in
order to preserve the Collateral or preserve its security interest in the
Collateral; and (iii) in the event of any proceeding for the collection or
enforcement of the obligations described in clauses (i) and (ii) above, after an
Event of Default has occurred and is continuing and unwaived, the expenses of
retaking, holding, preparing for sale or lease, selling or otherwise disposing
of or realizing on the Collateral, or of any exercise by the Collateral Agent of
its rights under the Security Documents, together with reasonable attorneys'
fees and court costs.
"Series Supplemental Indenture" means an indenture
supplemental to this Indenture entered into by the Issuer, the Trustee and the
Guarantors, if applicable, for the purpose of establishing, in accordance with
this Indenture, the title, form and terms of Senior Secured Notes of any series.
"Shelf Registration Statement" means the shelf registration
statement issued by the Issuer in connection with the offer and sale of Senior
Secured Notes pursuant to a Registration Rights Agreement.
"Sierra Pacific Geothermal Resources Lease" means that certain
Geothermal Resources Lease, dated November 18, 1983, between Steamboat
Geothermal and Sierra Pacific Power Company, as amended by the amendments dated
January 7, 1985, October 29, 1988, and October 2, 1989.
"Site Licenses" means the Mammoth-BLM Site License, the
Ormesa-BLM Xxxx Xxxxxxx XX 00000, the Ormesa-BLM Xxxx Xxxxxxx XX 00000, the
Ormesa-BLM Xxxx Xxxxxxx XX 00000, the Ormesa-BLM Xxxx Xxxxxxx XX 00000, and the
Ormesa-BLM Xxxx Xxxxxxx XX 00000.
"Special Record Date" for the payment of any Overdue Interest
or Overdue Principal shall mean a date fixed by the Trustee pursuant to Section
2.09.
"Steamboat Complex Operation and Maintenance Agreement" means
that certain Amended and Restated Operation and Maintenance Agreement, dated
December 8, 2003, among ORNI 7, LLC, Steamboat Geothermal LLC, Steamboat
Development (as of the Closing Date) and Ormat Nevada, Inc.
"Steamboat Development" means Steamboat Development, a Utah
corporation.
"Steamboat Development Plant" means the two geothermal power
generating plants located in Steamboat Hills, Nevada, having a gross generating
capacity of 32 MW and owned by Steamboat Development
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"Steamboat Geothermal" means Steamboat Geothermal LLC, a
Delaware limited liability company.
"Steamboat Geothermal Plant" means the two geothermal power
generating plants located in Steamboat Hills, Nevada, having a gross generating
capacity of 10 MW and owned by Steamboat Geothermal.
"Steamboat 1 Plant Power Purchase Agreement" means that
certain Agreement for the Purchase and Sale of Electricity, dated November 18,
1983, between Steamboat Geothermal LLC (as successor to Geothermal Development
Associates) and Sierra Pacific Power Company, as amended by that certain
Amendment to Agreement for the Purchase and Sale of Electricity, dated March 6,
1987.
"Steamboat 1A Plant Power Purchase Agreement" means that
certain Long-Term Agreement for the Purchase and Sale of Electricity, dated
October 29, 1988, between Steamboat Geothermal LLC (as successor to Far West
Capital, Inc.) and Sierra Pacific Power Company.
"Steamboat 2 Plant Power Purchase Agreement" means that
certain Long-Term Agreement, dated January 24, 1991, between Steamboat
Development (as successor to Far West Capital, Inc.) and Sierra Pacific Power
Company, as amended by that certain Amendment to Long-Term Agreement, dated
October 29, 1991, and as further amended by that certain Amendment to Long-Term
Agreement, dated October 29, 1992.
"Steamboat 1/1A Interconnection Agreement" means that certain
Special Facilities Agreement, dated October 29, 1988, between Sierra Pacific
Power Company and Steamboat Geothermal (as successor to Far West Capital, Inc.).
"Steamboat 2/3 Interconnection Agreement" means that certain
Special Facilities Agreement, dated April 24, 1992, between Sierra Pacific Power
Company and Steamboat Development (as successor to Far West Capital, Inc.).
"Steamboat 2/3 Project Power Purchase Agreements" means the
Steamboat 2 Plant Power Purchase Agreement and the Steamboat 3 Plant Power
Purchase Agreement.
"Steamboat 3 Plant Power Purchase Agreement" means that
certain Long-Term Agreement for the Purchase and Sale of Electricity, dated
January 18, 1991, between Steamboat Geothermal Development (as successor to Far
West Capital, Inc.) and Sierra Pacific Power Company.
"Subordinated Debt" means Indebtedness incurred pursuant to a
Subordinated Loan Agreement.
"Subordinated Debt Provider" means a Person providing loans
pursuant to a Subordinated Loan Agreement.
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"Subordinated Loan Agreement" means a binding agreement
providing nonrecourse, unsecured debt financing to the Issuer on the terms and
conditions set forth in Exhibit D to this Indenture.
"Subsidiary" means, with respect to any specified Person:
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency and
after giving effect to any voting agreement or stockholders' agreement
that effectively transfers voting power) to vote in the election of
directors, managers or trustees of the corporation, association or
other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of
that Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of
such Person or (b) the only general partners of which are that Person
or one or more Subsidiaries of that Person (or any combination
thereof).
"Third Party Consents" means each consent to assignment, among
certain counterparties to a Material Project Document, the Issuer and/or the
Issuer's applicable Subsidiary and the Collateral Agent.
"TIA" means the Trust Indenture Act of 1939 (15
U.S.C. (sections) 77aaa-77bbbb) as in effect on the date on which this Indenture
is qualified under the TIA.
"Title Event" means the existence of any defect of title or
Lien or encumbrance on a Project (other than Permitted Liens) in effect on the
Closing Date that entitles the Collateral Agent to make a claim under the policy
or policies of title insurance required pursuant to the Financing Documents.
"Title Event Proceeds" means all amounts and proceeds
(including instruments) in respect of any Title Event.
"Title Policies" means (i) each of the mortgagee title
insurance policies delivered by a title company of national standing or its
Affiliates insuring to the Lien of the Deeds of Trust or (ii) for those Projects
which do not have Deeds of Trust, the preliminary title report delivered by a
title company of national standing or its Affiliates.
"Transaction Documents" means the Project Documents and the
Financing Documents.
"Trustee" means Union Bank of California, N.A., until a
successor replaces it in accordance with the applicable provisions of this
Indenture, and thereafter means the successor serving thereunder in such
capacity.
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"Unassigned Leases" means (i) that certain Grant of Easement
between Xxxxx X. Xxxxx, Xxxxxxx Xxxxx and Xxxxxx Xxxxx, and Xxxxx X. Xxxxxxx,
Trustee of the Xxxxx X. Xxxxxxx Revocable Trust, dated August 24, 1996, as
grantor, and Xxxxx Power, as grantee, dated March 27, 1998; (ii) the Railway
Geothermal Resources Lease; (iii) the Fleetwood Geothermal Resources Sublease;
(iv) that certain Geothermal Resources Lease dated May 31, 1991 between Xxxxxxx
X. Xxxxx and the Trust of Xxxxxxx X. Xxxxx, as landlord, and Fleetwood
Corporation, as tenant; and (v) that certain Geothermal Resources Lease dated
June 27, 1988, as amended by that certain Amendment to Geothermal Resources
Lease dated January 1992, and that certain Second Amendment to Geothermal
Resources Lease dated June 25, 1993 between Xxxxxxx Xxxxxx, Xxxxxx Xxxxxx, and
Xxxxx Xxxxxxxx, Trustees and Beneficiaries of the Xxxxxx Trust, as landlord, and
Steamboat Development Corp., as tenant.
"Unrestricted Global Note" means a permanent global Senior
Secured Note in the form of Exhibit A-1 attached hereto that bears the Global
Note Legend and that has the "Schedule of Exchanges of Interests in the Global
Note" attached thereto, and that is deposited with or on behalf of and
registered in the name of the Depositary, representing Senior Secured Notes that
do not bear the Private Placement Legend.
"U.S. Person" means a U.S. person as defined in Rule 902(o)
under the Securities Act.
"Work" means all obligations, duties and responsibilities
undertaken by the Contractor and its subcontractors in accordance with the
Galena Re-powering Contract, including the design, engineering, manufacturing,
procurement, construction, start-up and performance testing of the Galena Plant
in connection with the Galena Re-powering.
"Wholly Owned Subsidiary" of any specified Person means a
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) will at
the time be owned by such Person or by one or more Wholly Owned Subsidiaries of
such Person.
Section 1.02 Other Definitions.
Term Defined in Section
"Affiliate Transaction" ................... 4.13
"Applicable Procedures" ................... 2.07(c)(v)(B)
"Beneficial Owner" ........................ 4.03
"Checking Account"......................... 4.30
"Combined Xxxxx Output" ................... 4.06(c)
"Covenant Defeasance"...................... 7.03
"Debtor Relief Law"........................ 5.01
"Issuer"................................... Preamble
"Legal Defeasance"......................... 7.02
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"Overdue Interest"......................... 2.09
"Temporary Regulation S Global Note"....... 2.01
"Transfer" ................................ 2.07(b)
"Trustee".................................. Preamble
"Withdrawal Certificate" .................. 4.42
Section 1.03 Trust Indenture Act Provisions. Whenever this
Indenture refers to a provision of the TIA, the provision is incorporated by
reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Senior Secured Notes;
"indenture security holder" means a Holder of a Senior Secured
Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Senior Secured Notes means the Issuer and any
successor obligor upon the Senior Secured Notes.
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
Section 1.04 Rules of Construction. Unless the context
otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the
plural include the singular;
(e) references to a Person shall include such Person's
permitted successors and assigns;
(f) provisions apply to successive events and transactions;
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(g) unless otherwise expressly specified, any agreement,
contract or document defined or referred to herein shall mean such
agreement, contract or document as in effect as of the date hereof, as
the same may thereafter be amended, supplemented and/or otherwise
modified from time to time in accordance with the terms of this
Indenture and the other Transaction Documents and shall include any
agreement, contract or document in substitution or replacement of any
of the foregoing entered into in accordance with the terms of this
Indenture and the other Transaction Documents; and
(h) references to sections of or rules under the Securities
Act shall be deemed to include substitute, replacement or successor
sections or rules adopted by the SEC from time to time.
ARTICLE II
THE SENIOR SECURED NOTES
Section 2.01 Form Generally. The Senior Secured Notes of each
series shall be in substantially the form set forth in Xxxxxxx X-0/X-0 or in
such other form as shall, subject to Section 2.05, be established by or pursuant
to an Officer's Certificate of the Issuer or in one or more Series Supplemental
Indentures relating to the Senior Secured Notes of such series, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as
may be required to comply with the rules of any securities exchange or
Depository therefor or as may, consistently herewith, be determined by the
officers executing such Senior Secured Notes as evidenced by their execution
thereof.
The Certificated Notes shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the Authorized Officers executing such Certificated Notes, as
evidenced by their execution of such Certificated Notes.
Restricted Notes shall bear the applicable legends as set
forth in Xxxxxxx X-0/X-0 and as provided in Section 2.02.
Senior Secured Notes offered and sold in their initial
distribution in reliance on Rule 144A shall be issued in the form of one or more
Global Notes (each a "Restricted Global Note") in definitive, fully registered
form without interest coupons, substantially in the form set forth in Exhibit
A-1, or in such other form as shall, subject to Section 2.05, be established by
or pursuant to an Officer's Certificate of the Issuer or in one or more
indentures supplemental hereto, with such applicable legends as are provided for
in Exhibit A-1. Such Global Notes shall be registered in the name of the
Depository for such Global Notes or its nominee and deposited with the Trustee,
at the Corporate Trust Office of the Trustee, as custodian for such Depository,
duly executed on behalf of the Issuer and authenticated by the Trustee as herein
provided. The aggregate principal amount of any Restricted Global Note may from
time to time be increased or
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decreased by adjustments made on the records of the Trustee, as custodian for
the Depository for such Global Note, as provided in Section 2.07, which
adjustments shall be conclusive as to the aggregate principal amount of any such
Global Notes. Except as agreed by the Issuer, no Restricted Global Note shall be
issued except as provided in this paragraph to evidence Senior Secured Notes
offered and sold in their initial distribution in reliance on Rule 144A.
Senior Secured Notes offered and sold in their initial
distribution in reliance on Regulation S shall be issued initially in the form
of one or more temporary Global Notes (a "Temporary Regulation S Global Note")
in definitive, fully registered form without interest coupons, substantially in
the form set forth in Exhibit A-2, or in such other form as shall, subject to
Section 2.05, be established by or pursuant to an Officer's Certificate of the
Issuer or in one or more indentures supplemental hereto, with such applicable
legends as are provided for in Exhibit A-2. Such Temporary Regulation S Global
Notes shall be registered in the name of the Depository for such Global Notes or
its nominee and deposited with the Trustee, at the Corporate Trust Office of the
Trustee, as custodian for such Depository, duly executed by the Issuer and
authenticated by the Trustee as herein provided, for credit to the respective
accounts of beneficial owners of such Global Notes (or to such other accounts as
they may direct) at Euroclear or Clearstream. Beneficial interests in any
Temporary Regulation S Global Note may be held only through Euroclear or
Clearstream. Within a reasonable period of time after the expiration of the
Restricted Period (as defined below), any Temporary Regulation S Global Note
will be exchanged for a permanent Regulation S Global Note (the "Regulation S
Unrestricted Global Note," and together with the Temporary Regulation S Global
Note, the "Regulation S Global Note") substantially in the form set forth in
Exhibit A-1 with such applicable legends as are provided for in Exhibit A-1, but
without the Restricted Notes legend set forth in Exhibit A-1, upon delivery to
the Depository of certification of non-United States ownership and compliance
with Regulation S. The Regulation S Unrestricted Global Note will be deposited
with the Trustee at the Corporate Trust Office of the Trustee, as custodian for
the Depository and registered in the name of the nominee of the Depository.
Clearstream and Euroclear will hold beneficial interests in the Regulation S
Unrestricted Global Note on behalf of their participants through their
respective depositories, which in turn will hold such beneficial interests in
the Regulation S Unrestricted Global Note in participants' securities accounts
in the depositories' names on the books of the Depository. The aggregate
principal amount of any Temporary Regulation S Global Note and any Regulation S
Unrestricted Global Note may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depository
for such Global Note, as provided in Section 2.07, which adjustments shall be
conclusive as to the aggregate principal amount of any such Global Note. As used
herein, the term "Restricted Period", with respect to Global Notes offered and
sold in reliance on Regulation S, means the period of 40 consecutive days
beginning on and including the later of (i) the day on which the Senior Secured
Notes are first offered to persons other than distributors (as defined in
Regulation S) in reliance on Regulation S (according to a written notice to the
Issuer and the Trustee by the underwriter(s), if any, of the offering of such
Senior Secured Notes) and (ii) the date of the closing of the offering of such
Senior Secured Notes. Except as agreed by the Issuer, no Temporary Regulation S
Global Note or Regulation S Unrestricted Global Note shall
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be issued except as provided in this paragraph to evidence such Senior Secured
Notes offered and sold in their initial distribution in reliance on Regulation
S.
Section 2.02 Legends on Restricted Notes. All Senior Secured
Notes issued pursuant to this Indenture (including Senior Secured Notes issued
upon registration of transfer, in exchange for or in lieu of such Senior Secured
Notes) shall be "Restricted Notes" and shall bear the applicable legend(s)
setting forth restrictions on transfer provided in Exhibit A-1/A-2 (the "Private
Placement Legend"); provided, however, that the term "Restricted Notes" shall
not include (i) Temporary Regulation S Global Notes or Regulation S Unrestricted
Global Notes, (ii) Senior Secured Notes as to which such restrictive legend(s)
shall have been removed pursuant to Section 2.07 and (iii) Senior Secured Notes
issued upon registration of transfer of, in exchange for, or in lieu of, Senior
Secured Notes that are not Restricted Notes.
Section 2.03 Amount of Senior Secured Notes. The aggregate
principal amount of Senior Secured Notes which may be outstanding at any time is
unlimited, subject to compliance with Section 4.18 hereof.
The Senior Secured Notes may be issued in one or more series.
There shall be established in one or more Series Supplemental Indentures, prior
to the issuance of Senior Secured Notes of any series:
(a) the title of the Senior Secured Notes of such series
(which shall distinguish the Senior Secured Notes of such series from
all other Senior Secured Notes) and the form or forms of Senior Secured
Notes of such series;
(b) any limit upon the aggregate principal amount of the
Senior Secured Notes of such series that may be authenticated and
delivered under this Indenture (except for Senior Secured Notes
authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Senior Secured Notes of such series
pursuant to Sections 2.06, 2.07, 2.08, 3.06 or 8.09 and except for
Senior Secured Notes that, pursuant to the last paragraph of Section
2.05, are deemed never to have been authenticated and delivered
hereunder);
(c) the date or dates on which the principal of the Senior
Secured Notes of such series is payable, the amounts of principal
payable on such date or dates and the Regular Record Date for the
determination of Holders to whom principal is payable; and the date or
dates on or as of which the Senior Secured Notes of such series shall
be dated, if other than as provided in Section 2.05;
(d) the rate or rates at which the Senior Secured Notes of
such series shall bear interest, or the method by which such rate or
rates shall be determined, the date or dates from which such interest
shall accrue, the interest payment dates on which such interest shall
be payable and the Regular Record Date for the determination of Holders
to
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whom interest is payable; and the basis of computation of interest, if
other than as provided in Section 2.12;
(e) if other than as provided in Section 4.02, the place or
places where (i) the principal of, interest and Liquidated Damages, if
any, on Senior Secured Notes of such series shall be payable, (ii)
Senior Secured Notes of such series may be surrendered for registration
of transfer or exchange and (iii) notices and demands to or upon the
Issuer in respect of the Senior Secured Notes of such series and this
Indenture may be served;
(f) the price or prices at which, the period or periods within
which and the terms and conditions upon which Senior Secured Notes of
such series may be redeemed, in whole or in part, at the option of the
Issuer;
(g) the obligation, if any, of the Issuer to redeem, purchase
or repay Senior Secured Notes of such series pursuant to any sinking
fund or analogous provision or at the option of a Holder thereof and
the price or prices at which and the periods or periods within which
and the terms and conditions upon which Senior Secured Notes of such
series shall be redeemed, purchased or repaid, in whole or in part,
pursuant to such obligations;
(h) if other than minimum denominations of $1,000 and any
integral multiple of $1,000 in excess thereof, the denominations in
which Senior Secured Notes of such series shall be issuable;
(i) the restrictions or limitations, if any, on the transfer
or exchange of the Senior Secured Notes of such series;
(j) the obligation, if any, of the Issuer to file a
registration statement with respect to the Senior Secured Notes of such
series or to exchange the Senior Secured Notes of such series for
Senior Secured Notes registered pursuant to the Securities Act;
(k) any other terms of such series (which terms shall not be
inconsistent with the provisions of this Indenture); and
(l) any trustees, authenticating or paying agents, warrant
agents, transfer agents or registrars with respect to the Senior
Secured Notes of such series.
Section 2.04 Denominations. The Senior Secured Notes shall be
issuable only in registered form without coupons and in denominations of $1,000
and any integral multiple of $1,000 in excess thereof. Any repayments (either
scheduled or pursuant to any redemption) of any Senior Secured Note shall be
made only in the denomination or integral multiple thereof set forth above.
Section 2.05 Execution, Authentication, Delivery and Dating.
The Senior Secured Notes shall be executed on behalf of the Issuer by an
Authorized Representative of the
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Issuer. The signature of any of these officers on the Senior Secured Notes may
be manual or facsimile.
Senior Secured Notes bearing the manual or facsimile signature
of individuals who were at the time of execution the Authorized Representative
of the Issuer shall bind the Issuer, notwithstanding that such individuals or
any of them have ceased to hold such offices prior to the authentication and
delivery of such Senior Secured Notes or did not hold such offices at the date
of such Senior Secured Notes.
At any time and from time to time after the execution and
delivery of this Indenture, the Issuer may deliver Senior Secured Notes (with
Guarantees endorsed thereon), if applicable, of any series executed by the
Issuer to the Trustee for authentication, together with a Authentication Order
for the authentication and delivery of such Senior Secured Notes, and the
Trustee in accordance with the Authentication Order shall authenticate and
deliver such Senior Secured Notes. The Trustee shall authenticate and deliver:
(i) on the Closing Date, an aggregate principal amount of $190,000,000 8 1/4%
Senior Secured Notes Due 2020, (ii) Additional Notes for an original issue in an
aggregate principal amount specified in an Authentication Order pursuant to this
Section 2.05 and (iii) Exchange Notes for issue only in an Exchange Offer
pursuant to a Registration Rights Agreement, for a like principal amount of
Initial Notes or Additional Notes, in each case upon an Authentication Order of
the Issuer signed by an Authorized Officer of the Issuer. Such order will
specify the amount of the Senior Secured Notes to be authenticated and the date
on which the original issue of the Senior Secured Notes is to be authenticated.
If the form or terms of the Senior Secured Notes have been established by or
pursuant to an Officer's Certificate of the Issuer or a Supplemental Indenture
as permitted by Section 2.01 in authenticating such Senior Secured Notes, and
accepting any additional responsibilities under this Indenture in relation to
such Senior Secured Notes, the Trustee shall be entitled to receive, and shall
be fully protected in relying upon, an Opinion of Counsel stating,
(a) that such form has been established in conformity with the
provisions of this Indenture;
(b) that such terms have been established in conformity with
the provisions of this Indenture; and
(c) that such Senior Secured Notes, when authenticated and
delivered by the Trustee and issued by the Issuer in the manner and subject to
any conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Issuer, enforceable against the Issuer in
accordance with their terms (subject to customary qualifications or exceptions).
The Trustee shall not be required to authenticate such Senior
Secured Notes if the issue of such Senior Secured Notes pursuant to this
Indenture will affect the Trustee's own rights, duties or immunities under the
Senior Secured Notes and this Indenture or otherwise in a manner which is not
reasonably acceptable to the Trustee.
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Except as otherwise provided in the Series Supplemental
Indenture relating to the Senior Secured Notes of a series, each Senior Secured
Note of such series shall be dated the date of its authentication.
No Senior Secured Note shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there appears on
such Senior Secured Note a certificate of authentication substantially in the
form provided for herein executed by the Trustee by manual signature of an
Authorized Officer, and such certificate upon any Senior Secured Note shall be
conclusive evidence, and the only evidence, that such Senior Secured Note has
been duly authenticated and delivered hereunder. Notwithstanding the foregoing,
if any Senior Secured Note shall have been authenticated and delivered hereunder
but never issued and sold by the Issuer, and the Issuer shall deliver such
Senior Secured Note to the Trustee for cancellation as provided in Section 2.11,
for all purposes of this Indenture such Senior Secured Note shall be deemed
never to have been authenticated and delivered hereunder and shall never be
entitled to the benefits of this Indenture.
Section 2.06 Temporary Senior Secured Notes. Pending the
preparation of definitive Senior Secured Notes, the Issuer may execute, and upon
Authentication Order the Trustee shall authenticate and deliver, temporary
Senior Secured Notes which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Senior Secured Notes in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers of the Issuer executing the same may determine, as
evidenced by their execution of such Senior Secured Notes.
If temporary Senior Secured Notes are issued, the Issuer will
cause definitive Senior Secured Notes to be prepared without unreasonable delay.
After the preparation of definitive Senior Secured Notes, the temporary Senior
Secured Notes shall be exchangeable for definitive Senior Secured Notes upon
surrender of the temporary Senior Secured Notes at the office or agency of the
Issuer in a Place of Payment, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Senior Secured Notes, the Issuer shall
execute and the Trustee shall authenticate and deliver in exchange therefor one
or more definitive Senior Secured Notes of any authorized denominations and of
like tenor and aggregate principal amount. Until so exchanged, the temporary
Senior Secured Notes shall in all respects be entitled to the same benefits
under this Indenture as definitive Senior Secured Notes.
Section 2.07 Registration, Registration of Transfer and
Exchange.
(a) General. The Issuer shall cause to be kept at the
Corporate Trust Office of the Trustee a register in which, subject to such
reasonable regulations as it may prescribe, the Issuer shall provide for the
registration of Senior Secured Notes and for transfers of Senior Secured Notes.
The Trustee is hereby appointed "Registrar" for the purpose of registering
Senior Secured Notes and transfers of Senior Secured Notes as herein provided.
The Issuer also shall cause to be kept an office or agency where Senior Secured
Notes may be presented for payment
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("Paying Agent") and where notices and demands to or upon the Issuer in respect
of the Senior Secured Notes may be served.
Notwithstanding anything to the contrary set forth herein, the
Trustee shall not be required and shall have no obligation to monitor compliance
with any federal or state securities laws.
Upon surrender for registration of transfer of any Senior
Secured Note at the office or agency of the Issuer in a Place of Payment, the
Issuer shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Senior Secured
Notes, of any authorized denominations and of like tenor and aggregate principal
amount.
At the option of the Holder, Senior Secured Notes may be
exchanged for other Senior Secured Notes, of any authorized denominations and of
like tenor and aggregate principal amount, upon surrender of the Senior Secured
Notes to be exchanged at such office or agency. Whenever any Senior Secured
Notes are so surrendered for exchange, the Issuer shall execute, and the Trustee
shall authenticate and deliver, the Senior Secured Notes which the Holder making
the exchange is entitled to receive.
All Senior Secured Notes issued upon any registration of
transfer or exchange of Senior Secured Notes shall be the valid obligations of
the Issuer, evidencing the same debt, and entitled to the same benefits under
this Indenture as the Senior Secured Notes surrendered upon such registration of
transfer or exchange.
Every Senior Secured Note presented or surrendered for
registration of transfer or for exchange shall be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the Registrar duly executed by the Holder thereof or his attorney
duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Senior Secured Notes, but the Issuer may require payment
of a sum sufficient to cover any tax or other governmental charge that maybe
imposed in connection with any registration of transfer or exchange of Senior
Secured Notes, other than exchanges pursuant to Section 2.06 or Section 3.06 not
involving any transfer.
If the Senior Secured Notes are to be redeemed in part, the
Issuer shall not be required (A) to issue, register the transfer of, or
exchange, any Senior Secured Notes during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Senior Secured Notes selected for redemption under Section 3.03 and ending
at the close of business on the day of such mailing or (B) to register the
transfer of or exchange any Senior Secured Note so selected for redemption in
whole or in part, except the unredeemed portion of any Senior Secured Note being
redeemed in part.
(b) Restricted Notes.
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Every Restricted Note shall be subject to the restrictions on
offers, Transfers and exchanges provided in the applicable legend(s) required to
be set forth on the face of each Restricted Note pursuant to Exhibit A-1/A-2 and
Section 2.02, unless such restrictions on Transfer shall be waived by the
written consent of the Issuer, and the Holder of each Restricted Note, by such
Holder's acceptance thereof, agrees to be bound by such restrictions on
Transfer. Whenever any Restricted Note is presented or surrendered for
registration of Transfer or for exchange for a Senior Secured Note registered in
a name other than that of the Holder, such Restricted Note must be accompanied
by an appropriately completed certificate in substantially the form set forth in
Exhibit B, in the case of Transfer, or, in the case of any exchange, Exhibit C
or as contemplated by Section 2.13(c) (which may be attached to or set forth in
the Restricted Note), appropriately completed, dated the date of such surrender
and signed by the Holder of such Restricted Note, as to compliance with such
restrictions on Transfer, unless the Issuer shall have notified the Trustee in
writing pursuant to this Section 2.07 that there is an effective registration
statement under the Securities Act with respect to such Restricted Note. The
Registrar shall not be required to accept for such registration of Transfer or
exchange any Restricted Note not so accompanied by a properly completed
certificate.
Except as otherwise provided in the preceding paragraph, if
Senior Secured Notes are issued upon the Transfer, exchange or replacement of
Senior Secured Notes bearing a legend or legends setting forth restrictions on
Transfer, or if a request is made to remove such legend(s) on a Senior Secured
Note, the Senior Secured Notes so issued shall bear such legend(s) or such
legend(s) shall not be removed, as the case may be, unless the transferor
delivers to the Issuer such satisfactory evidence (which may include an opinion
of independent counsel experienced in matters of United States securities law as
may be reasonably satisfactory to the Issuer), as may be reasonably required by
the Issuer, that neither such legend(s) nor the restrictions on Transfer set
forth therein are required to ensure that Transfers thereof comply with the
provisions of Rule 144A or Rule 144 or Regulation S or that such Senior Secured
Notes are not restricted securities within the meaning of Rule 144. Upon
provision of such satisfactory evidence to the Issuer, the Trustee, at the
written direction of the Issuer set forth in an Officer's Certificate of the
Issuer, shall authenticate and deliver a Senior Secured Note that does not bear
such legend(s). In the absence of bad faith on its part, the Trustee may
conclusively rely upon such direction of the Issuer in authenticating and
delivering a Senior Secured Note that does not bear such legend(s).
After a Transfer of any Initial Notes pursuant to and during
the period of the effectiveness of a Shelf Registration Statement with respect
to such Initial Notes, all requirements pertaining to legends relating to the
restrictions on Transfer relating to the Securities Act on such Initial Note
will cease to apply, the requirements requiring that any such Initial Note
issued to certain Holders be issued in global form will cease to apply, and a
certificated Initial Note or an Initial Note in global form, in each case
without restrictive Transfer legends, will be available to the transferee of the
Holder of such Initial Notes upon exchange of such transferring Holder's
certificated Initial Note or appropriate directions to Transfer such Holder's
interest in the Global Note, as applicable.
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Upon the consummation of an Exchange Offer with respect to the
Initial Notes, all requirements pertaining to such Initial Notes that Initial
Notes issued to certain Holders be issued in global form will still apply with
respect to Holders of such Initial Notes that do not exchange their Initial
Notes, and Exchange Notes in certificated or global form, in each case without
the restrictive securities legend relating to the restrictions on Transfer
relating to the Securities Act set forth in Xxxxxxx X-0/X-0 hereto will be
available to Holders that exchange such Initial Notes in such Exchange Offer.
Upon registration of Transfer of or exchange of Senior Secured
Notes that are no longer Restricted Notes, the Issuer shall execute, and the
Trustee shall authenticate and deliver, a Senior Secured Note that does not bear
restrictive legends.
As used in this Section 2.07(b), the term "Transfer"
encompasses any sale, pledge or other transfer of any Senior Secured Notes
referred to herein.
(c) Global Notes. This Section 2.07(c) shall apply to Global
Notes.
(i) Each Global Note authenticated under this Indenture shall
be registered in the name of the Depository designated for such Global
Note or a nominee thereof and delivered to such Depository or a nominee
thereof or custodian therefor, and each such Global Note shall
constitute a single Global Note for all purposes of this Indenture. The
Senior Secured Notes may be represented by one or more Global Notes,
and such Global Notes may be Restricted Global Notes, Temporary
Regulation S Global Notes or Regulation S Unrestricted Global Notes, or
any combination thereof.
(ii) Notwithstanding any other provision in this Indenture, no
Global Note may be exchanged in whole or in part for Senior Secured
Notes registered, and no transfer of a Global Note in whole or in part
may be made, in the name of any Person other than the Depository for
such Global Note or a nominee thereof unless (A) such Depository (1)
has notified the Issuer that it is unwilling or unable to continue as
Depository for such Global Note or (2) has ceased to be a clearing
agency registered under the Exchange Act, and, in either case, a
successor Depository is not appointed within 90 days thereof, (B) the
Issuer executes and delivers to the Trustee a Authentication Order
providing that such Global Note shall be so transferable, registrable
and exchangeable, or (C) there shall have occurred and be continuing an
Event of Default with respect to the Global Notes. Any Global Note
exchanged pursuant to subclause (A) above shall be so exchanged in
whole and not in part and any Global Note exchanged pursuant to
subclause (B) or (C) above may be exchanged in whole or from time to
time in part as directed by the Depository for such Global Note.
Notwithstanding any other provision in this Indenture, a Global Note to
which the restriction set forth in the second preceding sentence shall
have ceased to apply may be transferred only to, and may be registered
and exchanged for Senior Secured Notes registered only in the name or
names of, such Person or Persons as the Depository for such Global Note
shall have directed and no transfer thereof other than such a transfer
may be registered.
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(iii) Subject to clause (ii) above, any exchange of a Global
Note for other Senior Secured Notes may be made in whole or in part,
and all Senior Secured Notes issued in exchange for a Global Note or
any portion thereof shall be registered in such name or names as the
Depository for such Global Note shall direct.
(iv) Every Senior Secured Note authenticated and delivered
upon registration of transfer of, or in exchange for or in lieu of, a
Global Note or any portion thereof, whether pursuant to this Section
2.07, Section 2.06, 2.09 or 3.06 or otherwise shall be authenticated
and delivered in the form of, and shall be, a Global Note, unless such
Senior Secured Note is registered in the name of a Person other than
the Depository for such Global Note or a nominee thereof.
(v) Notwithstanding any other provision of this Indenture or
of the Senior Secured Notes, transfers of interests in a Global Note of
the kind described in Section 2.01 and in subclauses (B), (C), (D) and
(E) of this clause (v) below shall be made only in accordance with this
clause (v), and all transfers of an interest in a Temporary Regulation
S Global Note shall comply with subclause (F) of this clause (v). The
provisions of this clause (v) providing for transfers of Senior Secured
Notes or beneficial interests in Global Notes to Persons who wish to
take delivery in the form of beneficial interests in a Restricted
Global Note, Temporary Regulation S Global Note or Regulation S
Unrestricted Global Note shall only apply if there is a Restricted
Global Note, Temporary Regulation S Global Note or Regulation S
Unrestricted Global Note, as the case may be.
(A) Transfer of Global Note. A Global Note may not be
transferred, in whole or in part to any Person other than the
Depository or a nominee thereof, and no such transfer to any
such other Person may be registered; provided that this
subclause (A) shall not prohibit any transfer of a Senior
Secured Note that is issued in exchange for a Global Note but
is not itself a Global Note. No transfer of a Senior Secured
Note to any Person shall be effective under this Indenture or
the Senior Secured Notes unless and until such Senior Secured
Note has been registered in the name of such Person. Nothing
in this Section 2.07 shall prohibit or render ineffective any
transfer of a beneficial interest in a Global Note effected in
accordance with the other provisions of this Section
2.07(c)(v).
(B) Restricted Global Note to Regulation S Global
Note. If the holder of a beneficial interest in a Restricted
Global Note wishes at any time to transfer such interest to a
person who wishes to take delivery thereof in the form of a
beneficial interest in a Regulation S Global Note, such
transfer may be effected, subject to the rules and procedures
of the Depository for such Global Note, Euroclear and
Clearstream, in each case to the extent applicable (the
"Applicable Procedures"), only in accordance with the
provisions of this Section 2.07(c)(v)(B). Upon receipt by the
Trustee, as Registrar, at the Corporate Trust Office of (1)
written instructions given in accordance with the Applicable
Procedures from a member of, or participant in, the Depository
for such Restricted Global Note (each, an "Agent Member")
directing the Trustee to credit or cause to be credited to a
specified Agent Member's account a beneficial interest in a
Regulation S Global Note in a principal amount equal to that
of the beneficial interest in the Restricted Global Note to be
so transferred, (2) a written order given in accordance with
the Applicable
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Procedures containing information regarding the account of
the Agent Member (and the Euroclear or Clearstream account,
as the case may be) to be credited with, and the account of
the Agent Member to be debited for, such beneficial interest
and (3) an appropriately completed certificate in
substantially the form set forth in or contemplated by
Section 2.13(a) given by the holder of such beneficial
interest, the Trustee, as Registrar, shall instruct the
Depository for such Notes to reduce the principal amount of
the Restricted Global Note, and to increase the principal
amount of the Regulation S Global Note, by the principal
amount of the beneficial interest in the Restricted Global
Note to be so transferred, and to credit or cause to be
credited to the account of the Person specified in such
instructions (which shall be the Agent Member for Euroclear
or Clearstream or both, as the case may be) a beneficial
interest in the Regulation S Global Note having a principal
amount equal to the amount by which the principal amount of
the Restricted Global Note was reduced upon such transfer.
(C) Regulation S Global Note to Restricted Global
Note. If the holder of a beneficial interest in a Regulation S
Global Note wishes at any time to transfer such interest to a
Person who wishes to take delivery thereof in the form of a
beneficial interest in a Restricted Global Note, such transfer
may be effected, subject to the Applicable Procedures, only in
accordance with this Section 2.07(c)(v)(C). Upon receipt by
the Trustee, as Registrar, at the Corporate Trust Office of
(1) written instructions given in accordance with the
Applicable Procedures from an Agent Member directing the
Trustee, as Registrar, to credit or cause to be credited to a
specified Agent Member's account a beneficial interest in the
Restricted Global Note equal to that of the beneficial
interest in the Regulation S Global Note to be so transferred,
(2) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the
Agent Member to be credited with, and the account of the Agent
Member (or, if such account is held for Euroclear or
Clearstream, the Euroclear or Clearstream account, as the case
may be) to be debited for, such beneficial interest and (3)
with respect to a transfer of a beneficial interest in the
Regulation S Global Note, an appropriately completed
certificate in substantially the form set forth in or
contemplated by Section 2.13(b) given by the holder of such
beneficial interest, the Trustee, as Registrar, shall instruct
the Depository for such Regulation S Global Note to reduce the
principal amount of the Regulation S Global Note and to
increase the principal amount of the Restricted Global Note,
by the principal amount of the beneficial interest in the
Regulation S Global Note to be so transferred, and to credit
or cause to be credited to the account of the
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Person specified in such instructions a beneficial interest
in the Restricted Global Note having a principal amount
equal to the amount by which the principal amount of the
Regulation S Global Note was reduced upon such transfer.
(D) Restricted Note (other than a Restricted Global
Note) to Global Note. If the Holder of a Restricted Note
(other than a Restricted Global Note) wishes at any time to
transfer such Restricted Note to a Person who wishes to take
delivery thereof in the form of a beneficial interest in a
Restricted Global Note or an Unrestricted Global Note, such
transfer may be effected, subject to the Applicable
Procedures, only in accordance with this Section
2.07(c)(v)(D). Upon receipt by the Trustee, as Registrar, at
the Corporate Trust Office of (1) the Restricted Note to be
transferred, (2) written instructions given in accordance with
the Applicable Procedures from an Agent Member directing the
Trustee to credit or cause to be credited to a specified Agent
Member's account a beneficial interest in the Restricted
Global Note or the Unrestricted Global Note, as the case may
be, in a principal amount equal to the principal amount of the
Restricted Note to be so transferred, (3) a written order
given in accordance with the Applicable Procedures containing
information regarding the account of the Agent Member (and, in
the case of any transfer pursuant to Regulation S, the
Euroclear or Clearstream account for which such Agent Member's
account is held or, if such account is held for Euroclear or
Clearstream, the Euroclear or Clearstream account, as the case
may be) to be credited with such beneficial interest and (4)
an appropriately completed certificate in substantially the
form set forth in or contemplated by Section 2.13(c) (which
may be attached to or set forth in the Restricted Note), the
Trustee, as Registrar, shall cancel the Restricted Note, the
Issuer shall execute, and the Trustee shall authenticate and
deliver, a new Definitive Note for the principal amount, if
any, of the Restricted Note not so transferred, registered in
the name of the Holder transferring such Restricted Note, and
the Trustee shall instruct the Depository for such Notes to
increase the principal amount of the Restricted Global Note or
the Unrestricted Global Note, as the case may be, by the
principal amount of the Restricted Note so transferred, and to
credit or cause to be credited to the account of the Person
specified in such instructions (which, in the case of any
increase of the principal amount of an Unrestricted Global
Note as the result of a transfer pursuant to Regulation S,
shall be the Agent Member for Euroclear or Clearstream or
both, as the case may be) a corresponding principal amount of
the Restricted Global Note or the Unrestricted Global Note.
The transfer of a Restricted Note to a Person who wishes to
take delivery thereof in the form of a beneficial interest in
an Unrestricted Global Note may be effected only in accordance
with Regulation S or Rule 144A (as evidenced by the
certificate delivered pursuant to Section 2.13(c)).
(E) Other Exchanges. In the event that a Global Note
or any portion thereof is exchanged for Senior Secured Notes
other than Global Notes, the Trustee, as Registrar, shall
instruct the Depository for the Global Note to reduce
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the principal amount of the Global Note by the principal
amount of the Notes other than Global Notes issued upon such
exchange. Such other Notes may in turn be exchanged (on
transfer or otherwise) for beneficial interests in a Global
Note (if any are then outstanding) only in accordance with
such procedures, which shall be substantially consistent
with the provisions of subclauses (A) through (D) above
(including the certification requirements intended to insure
that transfers of beneficial interests in a Global Note
comply with Rule 144A, Rule 144 or Regulation S, as the case
may be) and any other procedures as may be from time to time
adopted by the Issuer and the Trustee.
(F) Interests in Temporary Regulation S Global Note
to be Held Through Euroclear or Clearstream. Until the
termination of the Restricted Period with respect to Senior
Secured Notes represented by a Temporary Regulation S Global
Note, interests in any Temporary Regulation S Global Note may
be held only through Agent Members acting for and on behalf of
Euroclear and Clearstream, provided that this subclause (F)
shall not prohibit any transfer in accordance with subclause
(D) of this Section 2.07(c)(v).
Section 2.08 Mutilated, Destroyed, Lost and Stolen Senior
Secured Notes. If any mutilated Senior Secured Note is surrendered to the
Trustee, the Issuer shall execute and, upon the Issuer's written request, the
Trustee shall authenticate and deliver a new definitive Senior Secured Note, of
like tenor and aggregate principal amount and equal face amount of principal,
registered in the same manner, dated the date of its authentication and bearing
interest from the date to which interest has been paid on such Senior Secured
Note, in exchange and substitution for such Senior Secured Note (upon surrender
and cancellation thereof); provided, that the applicant for such new Senior
Secured Note shall furnish to the Issuer and to the Trustee such reasonable bond
or indemnity as may be required by them to save each of them harmless.
If there shall be delivered to the Issuer and the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any Senior
Secured Note and (b) such bond or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Issuer or the Trustee that such Senior Secured Note has been
acquired by a bona fide purchaser, the Issuer shall execute and, upon the
Issuer's request, the Trustee shall authenticate and deliver a new definitive
Senior Secured Note, of like tenor and aggregate principal amount and equal face
amount of principal registered in the same manner, dated the date of its
authentication and bearing interest from the date to which interest has been
paid on such Senior Secured Note, in lieu of and substitution for such Senior
Secured Note.
In case any such mutilated, destroyed, lost or stolen Senior
Secured Note has become or is about to become due and payable, the Issuer in its
discretion may, instead of issuing a new Senior Secured Note, pay such Senior
Secured Note (without surrender thereof, except in the case of a mutilated
Senior Secured Note) if the applicant for such payment shall furnish to the
Issuer and the Trustee such reasonable bond or indemnity as they may require to
save each of
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them harmless, and in case of destruction, loss or theft, evidence to the
satisfaction of the Issuer and the Trustee of the destruction, loss or theft of
such Senior Secured Note.
Upon the issuance of any new Senior Secured Note under this
Section 2.08, the Issuer may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Senior Secured Note issued pursuant to this Section
2.08 in lieu of any destroyed, lost or stolen Senior Secured Note shall
constitute an original additional contractual obligation of the Issuer, whether
or not the destroyed, lost or stolen Senior Secured Note shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Senior Secured
Notes duly issued hereunder.
The provisions of this Section 2.08 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Senior
Secured Notes.
Section 2.09 Payments; Interest Rights Preserved. Interest on
any Senior Secured Note which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Senior Secured Note (or one or more Predecessor Senior Secured Notes)
is registered at the close of business on the Regular Record Date for such
interest.
Any interest or Liquidated Damages on any Senior Secured Note
which is payable; but is not punctually paid or duly provided for, on any
Interest Payment Date (herein called "Overdue Interest") shall forthwith cease
to be payable to the Holder on the relevant Regular Record Date by virtue of
having been such Holder, and such Overdue Interest may be paid by the Issuer, at
its election in each case, as provided in clause (a) or (b) below:
(a) The Issuer may elect to make payment of any Overdue
Interest to the Persons in whose names the Senior Secured Notes (or their
respective Predecessor Notes) are registered at the close of business on a
Special Record Date for the payment of such Overdue Interest, which shall be set
in the following manner. The Issuer shall notify the Trustee in writing of the
amount of Overdue Interest proposed to be paid on each Senior Secured Note and
the date of the proposed payment, and at the same time the Issuer shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Overdue Interest or shall make arrangements satisfactory
to the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons entitled
to such Overdue Interest as in this clause (a) provided. Thereupon, the Issuer
shall fix a Special Record Date for the payment of such Overdue Interest which
shall be not more than 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly, in the name
and at the expense of the Issuer, mail a written notice of the proposed
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payment of such Overdue Interest and the Special Record Date therefor to be
given to each Holder of Senior Secured Notes, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such Overdue
Interest and the Special Record Date therefor having been so mailed, such
Overdue Interest shall be paid to the Persons in whose names the Senior Secured
Notes (or their respective Predecessor Notes) are registered at the close of
business on such Special Record Date and shall no longer be payable pursuant to
the following clause (b).
(b) The Issuer may make payment of any Overdue Interest on the
Senior Secured Notes in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Senior Secured Notes may
be listed, and upon such notice as may be required by such exchange, if, after
notice given by the Issuer to the Trustee of the proposed payment pursuant to
this clause (b), such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section 2.09, each
Senior Secured Note delivered under this Indenture upon registration of transfer
of, or in exchange for, or in lieu of, any other Senior Secured Note shall carry
the rights to interest accrued and unpaid, and to accrue, which were carried by
such other Senior Secured Note.
All payments of principal, premium, or Liquidated Damages, if
any, and interest on Senior Secured Notes will be made by check or, with respect
to Senior Secured Notes the Holders of which have provided the Issuer with wire
transfer instructions, will be made by wire transfer of immediately available
funds to the accounts specified by the Holders thereof. Unless such designation
is revoked in writing, any designation made by such Holder with respect to such
Senior Secured Notes will remain in effect with respect to any future payments
with respect to such Senior Secured Notes payable to such Holder. The Issuer
will indemnify and hold the Trustee and the Paying Agent harmless against any
loss, liability or expense (including attorneys' fees) resulting from any act or
omission to act on the part of the Trustee, the Paying Agent or any such Holder
in connection with any such designation or which the Paying Agent or Trustee may
incur as a result of making any payment in accordance with any such designation.
All payments of principal, premium or Liquidated Damages, if
any, on the Senior Secured Notes shall be made upon presentation and surrender
thereof at the office or agency of the Issuer maintained for such purpose in the
Borough of Manhattan, The City of New York.
Section 2.10 Persons Deemed Owners. Prior to due presentment
of a Senior Secured Note for registration of transfer, the Issuer, the Trustee
and any agent of the Issuer or the Trustee shall treat the Person in whose name
such Senior Secured Note is registered as the owner of such Senior Secured Note
for the purpose of receiving payment of principal of and any premium or
Liquidated Damages and (subject to Section 2.09) any interest on such Senior
Secured Note and for all other purposes whatsoever, whether or not such Senior
Secured Note be overdue, and neither the Issuer, the Trustee nor any agent of
the Issuer or the Trustee shall be affected by notice to the contrary.
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Section 2.11 Cancellation. All Senior Secured Notes
surrendered for payment, redemption, registration of transfer or exchange shall,
if surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly canceled by it. The Issuer may at any time deliver to the
Trustee for cancellation any Senior Secured Notes previously authenticated and
delivered hereunder which the Issuer may have acquired in any manner whatsoever,
and may deliver to the Trustee (or to any other Person for delivery to the
Trustee for cancellation) any Senior Secured Notes previously authenticated
hereunder which the Issuer has not issued and sold, and all Senior Secured Notes
so delivered shall be promptly canceled by the Trustee. No Senior Secured Notes
shall be authenticated in lieu of or in exchange for any Senior Secured Notes
canceled as provided in this Section 2.11, except as expressly permitted by this
Indenture. All canceled Senior Secured Notes held by the Trustee shall be
disposed of as directed by an Authentication Order.
Section 2.12 Computation of Interest. Except as otherwise
provided in the Series Supplemental Indenture relating to the Senior Secured
Notes of a series, interest on the Senior Secured Notes of such series shall be
computed on the basis of a 360-day year comprised of twelve 30-day months.
Section 2.13 Certification Forms. (a) Whenever any
certification is to be given by a beneficial owner of a portion of a Restricted
Global Note pursuant to Section 2.07(c)(v)(D) in connection with the initial
transfer of a beneficial interest in a Restricted Global Note to a Person who
wishes to take delivery thereof in the form of a beneficial interest in a
Regulation S Global Note, such certification shall be provided substantially in
the form set forth in Exhibit C hereto.
(b) Whenever any certification is to be given by a beneficial
owner of a portion of a Regulation S Global Note pursuant to Section
2.07(c)(v)(D) in connection with the initial transfer of a beneficial interest
in the Regulation S Global Note to a Person who wishes to take delivery thereof
in the form of a beneficial interest in the Restricted Global Note, such
certification shall be provided substantially in the form set forth in Exhibit C
hereto.
(c) Whenever any certification is to be given by a beneficial
owner of a Restricted Note or Holder of a Restricted Note (other than a
Restricted Global Note) pursuant to Section 2.07(b) in connection with the
transfer or exchange of a Restricted Note, such certification shall be provided
substantially in the form set forth in Exhibit B (which may be attached to or
set forth on the Restricted Note).
Section 2.14 CUSIP Numbers. The Issuer in issuing the Senior
Secured Notes may use "CUSIP" or "ISIN" numbers (if then generally in use), and,
if so, the Trustee shall use "CUSIP" or "ISIN" numbers in notices of redemption
as a convenience to Holders; provided that the Trustee shall assume no
responsibility for the accuracy of such numbers and any such redemption shall
not be affected by any defect in or omission of such numbers.
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Section 2.15 Issuance of Additional Notes. The Issuer shall be
entitled, subject to its compliance with Section 4.18 hereof, to issue
Additional Notes under this Indenture with identical terms as the Initial Notes
issued on the Closing Date, other than with respect to the date of issuance and
issue price. The Initial Notes issued on the Closing Date, any Additional Notes
and all Exchange Notes issued in exchange therefor will be treated as a single
class for all purposes under this Indenture.
With respect to any Additional Notes, the Issuer will set
forth in a resolution of the Board of Directors of the Issuer and an Officers'
Certificate, copies of which will be delivered to the Trustee, the following
information:
(i) the aggregate principal amount of such Additional Notes to
be authenticated and delivered pursuant to this Indenture;
(ii) the issue price, the issue date and the CUSIP number of
such Additional Notes; provided, however, that no Additional Notes may
be issued at a price that would cause such Additional Notes to have
"original issue discount" within the meaning of Section 1273 of the
Internal Revenue Code of 1986, as amended; and
(iii) whether such Additional Notes will be Transfer
Restricted Securities or will be issued in the form of Exchange Notes.
ARTICLE III
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee. If the Issuer elects to
redeem Senior Secured Notes pursuant to the optional redemption provisions of
Section 3.07 hereof, it shall furnish to the Trustee and Paying Agent, at least
30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the clause of this Indenture pursuant to which the
redemption shall occur, (ii) the Redemption Date, (iii) the principal amount of
Senior Secured Notes to be redeemed and (iv) the redemption price.
Section 3.02 Selection of Senior Secured Notes to Be Redeemed.
If less than all of the Senior Secured Notes are to be redeemed at any time,
selection of Senior Secured Notes for redemption will be made by the Trustee on
a pro rata basis; provided that no Senior Secured Notes of $1,000 or less will
be redeemed in part. Notices of redemption will be mailed by first class mail at
least 30 but not more than 60 days before the Redemption Date to each Holder of
Senior Secured Notes to be redeemed at its registered address. Notices of
redemption may not be conditional. If any Senior Secured Note is to be redeemed
in part only, the notice of redemption that relates to such Senior Secured Note
will state the portion of the principal amount thereof to be redeemed. A new
Senior Secured Note in principal amount equal to the unredeemed portion thereof
will be issued in the name of the Holder thereof upon cancellation of the
original Senior Secured Note. Senior Secured Notes called for redemption become
due on
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the date fixed for redemption. Unless the Issuer defaults in payment of the
redemption price, interest and Liquidated Damages, if any, will cease to accrue
on Senior Secured Notes or portions of them called for redemption on and after
the Redemption Date.
The Trustee shall promptly notify the Issuer in writing of the
Senior Secured Notes selected for redemption and, in the case of any Senior
Secured Note selected for partial redemption, the principal amount thereof to be
redeemed. Senior Secured Notes and portions of Senior Secured Notes selected
shall be in denominations of $1,000 and integral multiples of $1,000; except
that if all of the Senior Secured Notes of a Holder are to be redeemed, the
entire outstanding amount of Senior Secured Notes held by such Holder, even if
not a multiple of $1,000, shall be redeemed. Except as provided in the preceding
sentence, provisions of this Indenture that apply to Senior Secured Notes called
for redemption also apply to portions of Senior Secured Notes called for
redemption.
Section 3.03 Notice of Redemption. At least 30 days but not
more than 60 days before a Redemption Date, the Issuer shall mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose Senior
Secured Notes are to be redeemed at its registered address.
The notice shall identify the Senior Secured Notes to be
redeemed and shall state:
(a) the Redemption Date;
(b) the redemption price;
(c) if any Senior Secured Note is being redeemed in part, the
portion of the principal amount of such Senior Secured Note to be redeemed and
that, after the redemption date upon surrender of such Senior Secured Note, a
new Senior Secured Note or Senior Secured Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Senior
Secured Note;
(d) the name, address and telephone number of the Paying
Agent;
(e) that Senior Secured Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(f) that, unless the Issuer defaults in making such redemption
payment, interest and Liquidated Damages, if any, on Senior Secured Notes called
for redemption ceases to accrue on and after the Redemption Date;
(g) the paragraph of the Senior Secured Notes and/or Section
of this Indenture pursuant to which the Senior Secured Notes called for
redemption are being redeemed; and
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(h) the CUSIP number (provided that the Issuer may state that
no representation is made as to the correctness or accuracy of the CUSIP number,
if any, listed in such notice or printed on the Senior Secured Notes).
At the Issuer's request, the Trustee or the Paying Agent shall
give the notice of redemption in the Issuer's name and at its expense; provided,
however, that the Issuer shall have delivered to the Trustee, at least 45 days
prior to the redemption date, an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the preceding paragraph.
Section 3.04 Effect of Notice of Redemption. Once notice of
redemption is mailed in accordance with Section 3.03 hereof, Senior Secured
Notes called for redemption become irrevocably due and payable on the Redemption
Date at the redemption price. A notice of redemption may not be conditional.
Section 3.05 Deposit of Redemption Price. One Business Day
prior to the Redemption Date, the Issuer shall deposit with the Trustee or with
the Paying Agent (other than the Issuer or an Affiliate of the Issuer) money
sufficient to pay the redemption price of and accrued interest and Liquidated
Damages, if any, on, all Senior Secured Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Issuer any money
deposited with the Trustee or the Paying Agent by the Issuer in excess of the
amounts necessary to pay the redemption price of, and accrued interest and
Liquidated Damages, if any, on, all Senior Secured Notes to be redeemed.
If the Issuer complies with the provisions of the preceding
paragraph and the other provisions of this Article III, on and after the
Redemption Date, interest and Liquidated Damages, if any, shall cease to accrue
on the Senior Secured Notes or the portions of Senior Secured Notes called for
redemption. If a Senior Secured Note is redeemed on or after an interest record
date but on or prior to the related Interest Payment Date, then any accrued and
unpaid interest and Liquidated Damages, if any, shall be paid to the Person in
whose name such Senior Secured Note was registered at the close of business on
such record date. If any Senior Secured Note called for redemption shall not be
so paid upon surrender for redemption because of the failure of the Issuer to
comply with the preceding paragraph, interest and Liquidated Damages, if any,
shall be paid on the unpaid principal, from the Redemption Date until such
principal is paid, and to the extent lawful on any interest, and Liquidated
Damages, if any, not paid on such unpaid principal, in each case at the rate and
in the manner provided in the Senior Secured Notes and in Section 4.01 hereof.
Section 3.06 Senior Secured Notes Redeemed in Part. Upon
surrender of a Senior Secured Note that is redeemed in part, the Issuer shall
issue and, upon the Issuer's written request, the Trustee shall authenticate for
the Holder at the expense of the Issuer a new Senior Secured Note equal in
principal amount to the unredeemed portion of the Senior Secured Note
surrendered.
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Section 3.07 Optional Redemption.
(a) The Senior Secured Notes shall be redeemable at the
Issuer's option at any time and from time to time, in whole or in part, upon not
less than 30 nor more than 60 days' notice to the Trustee and each Holder of
Senior Secured Notes, at a redemption price equal to the outstanding principal
amount thereof plus accrued interest and Liquidated Damages, if any, plus the
Make-Whole Premium, such redemption price to be set forth in the notice to the
Trustee. In no event shall the sum of the redemption price plus the Make-Whole
Premium ever be less than 100% of the Senior Secured Notes being redeemed plus
accrued and unpaid interest thereon to the Redemption Date. Unless the Issuer
defaults in payment of the redemption price, on and after the Redemption Date
interest and Liquidated Damages, if any, shall cease to accrue on the Senior
Secured Notes or portions thereof called for redemption.
(b) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof.
Section 3.08 Mandatory Redemption.
(a) The Senior Secured Notes shall be subject to mandatory
redemption, in whole or in part, at a redemption price equal to the principal
amount of the Senior Secured Notes being redeemed plus accrued and unpaid
interest and Liquidated Damages, if any, to the Redemption Date, if the Issuer
or any Subsidiary receives more than $5.0 million of Loss Proceeds or Eminent
Domain Proceeds because of an Event of Loss or an Event of Eminent Domain and:
(i) the Issuer determines that all or such portion of the
applicable Plant cannot be rebuilt, repaired or restored to permit
operations on a commercially reasonable basis, or the Issuer determines
not to rebuild, repair or restore the applicable Plant or such portion,
in which case the Issuer shall have to use the Net Available Amount of
such proceeds for such redemption; or
(ii) only a portion of the applicable Plant is capable of
being rebuilt, repaired or restored on a commercially reasonable basis
and the Issuer determines to so rebuild, repair or restore, in which
case the Issuer will have to use only the amount of such Loss Proceeds
or Eminent Domain Proceeds not used to rebuild, repair or restore such
Plant for such redemption, except as set forth in the immediately
following paragraph.
If the Issuer or any Subsidiary receives less than $5 million
of Loss Proceeds or Eminent Domain Proceeds or has less than $5 million
remaining after rebuilding, repairing or restoring a portion of the applicable
Plant because of an Event of Loss or Event of Eminent Domain the Issuer will
cause such amounts to be deposited into the Revenue Account.
(b) If the Issuer or any Subsidiary (a) receives more than
$5.0 million of Title Event Proceeds in connection with a Title Event and is
unable to remedy the Title Event, or (b) has more than $5.0 million of Title
Event Proceeds remaining after remedying the Title Event, the Issuer will have
to use the Net Available Amount of such proceeds, to the extent not
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used to cure the Title Event, on a pro rata basis to redeem the Senior Secured
Notes at a redemption price equal to the principal amount of the Senior Secured
Notes being redeemed plus accrued and unpaid interest and Liquidated Damages, if
any, to the Redemption Date. If the Issuer or any Subsidiary receives less than
$5 million of Title Event Proceeds in connection with a Title Event or has less
than $5 million remaining after remedying a Title Event the Issuer will cause
such amounts to be deposited into the Revenue Account.
(c) If on or prior to September 30, 2005, the Issuer has not
satisfied the Initial Galena Re-powering Account Withdrawal Conditions, then the
Issuer will have to use the proceeds of the Galena Re-powering Account to redeem
Senior Secured Notes at a price equal to 101% of the principal amount of Senior
Secured Notes being redeemed plus accrued and unpaid interest and Liquidated
Damages, if any, to the Redemption Date.
(d) If Final Completion is not achieved by March 31, 2006 or
the Galena Re-powering does not result in a minimum net electrical output of 18
MW as determined in accordance with performance tests conducted pursuant to the
Galena Re-powering Contract (as certified by the Independent Engineer), then
from and after March 31, 2006, the Issuer will not be able to make any
Restricted Payments until the Issuer has used any amounts the Issuer receives as
Performance Liquidated Damages and amounts in the Distribution Suspense Account
to redeem or has otherwise redeemed (a "Galena Re-powering Performance
Redemption") Senior Secured Notes in an amount equal to the product of (x)
$1,100,000 times (y) the difference between (i) 18 MW minus (i) the actual
number of Megawatts of the Galena Re-powering as demonstrated by the Performance
Guarantee Tests and certified by the Independent Engineer. The Issuer will
redeem the Senior Secured Notes in connection with a Galena Re-powering
Performance Redemption at a price equal to 101% of the principal amount of the
Senior Secured Notes required to be redeemed plus accrued and unpaid interest
and Liquidated Damages, if any, to the Redemption Date.
(e) If, as of January 1, 2006, the Mammoth Enhancement has not
improved the net electrical output of the Mammoth Plant by at least 3.6 MW (as
certified by the Independent Engineer), then from and after January 1, 2006, the
Issuer will not be able to make any Restricted Payments until the Issuer has
used amounts in the Distribution Suspense Account to redeem or has otherwise
redeemed (a "Mammoth Enhancement Redemption") Senior Secured Notes in an amount
equal to the product of (x) $1,100,000 times (y) the difference between (i) 3.6
MW minus (ii) the actual number of Megawatts that the Mammoth Enhancement
increases the net electrical output of the Mammoth Plant. The Issuer shall
redeem the Senior Secured Notes in connection with a Mammoth Enhancement
Redemption at a price equal to 101% of the principal amount of the Senior
Secured Notes required to be redeemed plus accrued and unpaid interest and
Liquidated Damages, if any, to the Redemption Date.
In the event that any Senior Secured Obligations (other than
the Senior Secured Notes) are required to be redeemed before their scheduled
maturity pursuant to documents governing such Senior Secured Obligations for any
reason not otherwise giving rise to a redemption of the Senior Secured Notes,
the Issuer shall offer to repurchase the Senior Secured
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Notes on a pro rata basis with the other Senior Secured Obligations as are
required to be redeemed at a redemption price equal to the principal amount of
the Senior Secured Notes the Issuer offers to repurchase plus accrued and unpaid
interest and Liquidated Damages, if any, to the Redemption Date, but without any
premium.
Other than as specifically provided in this Section 3.08, any
purchase or redemption pursuant to this Section 3.08 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof.
ARTICLE IV
COVENANTS
The Issuer and each of the Issuer's Subsidiaries (other than
Ormesa LLC, which shall only be subject to these covenants prior to the Ormesa
Support Date to the extent compliance therewith would not violate the Ormesa
Credit Agreement) shall be subject to the following covenants.
Section 4.01 Payment of Senior Secured Notes. The Issuer shall
pay or cause to be paid the principal of, premium, if any, interest and
Liquidated Damages, if any, on the Senior Secured Notes on the dates and in the
manner provided on Exhibits A-1 and A-2 attached hereto including the Schedule
of Principal Payments set forth on Schedule I attached thereto. Principal,
premium, if any, interest and Liquidated Damages, if any, shall be considered
paid on the date due if the Paying Agent, if other than the Issuer or a
Subsidiary or an Affiliate thereof, holds as of 10:00 a.m. Eastern Time on the
due date money deposited by the Issuer in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, interest
and Liquidated Damages, if any, then due.
The Issuer shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at the
rate equal to 1% per annum in excess of the then applicable interest rate on the
Senior Secured Notes to the extent lawful; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace period) and
Liquidated Damages, if any, at the same rate to the extent lawful.
Section 4.02 Maintenance of Office or Agency. The Issuer shall
maintain in the Borough of Manhattan, the City of New York, and in such other
places, if any, as shall be specified for the Senior Secured Notes of any series
in the related Series Supplemental Indenture an office or agency (which may be
an office of the Trustee or an affiliate of the Trustee, Registrar or
co-registrar) where Senior Secured Notes may be surrendered for registration of
transfer or for exchange and where notices and demands to or upon the Issuer in
respect of the Senior Secured Notes and this Indenture may be served. The Issuer
shall give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Issuer shall fail
to maintain any such required office or agency or shall fail to
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furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Issuer may also from time to time designate one or more
other offices or agencies where the Senior Secured Notes may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Issuer of its obligation to maintain an office or agency
in the Borough of Manhattan, the City of New York for such purposes. The Issuer
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Issuer hereby designates the Corporate Trust Office of the
Trustee as the initial office or agency of the Issuer where the Senior Secured
Notes may be presented or surrendered in accordance with the foregoing.
Section 4.03 Reporting Requirements. Whether or not required
by the SEC, so long as any Senior Secured Notes are outstanding, the Issuer
shall furnish to the Trustee for mailing to the Holders (directly to any
Beneficial Owner (as such term is defined Rule 13d-3 and Rule 13d-5 under the
Exchange Act) with notice of ownership on file with the Trustee), within the
time periods specified in the SEC's rules and regulations:
(a) all quarterly and annual financial information that would
be required to be contained in a filing with the SEC on Forms 10-Q and
10-K if the Issuer were required to file such Forms, including a
"Management's Discussion and Analysis of Financial Conditions and
Results of Operations" and, with respect to the annual information
only, a report on the annual financial statements by the Issuer's
certified independent accountants; and
(b) all current reports that would be required to be filed
with the SEC on Form 8-K if the Issuer were required to file such
reports.
In addition, following the consummation of the Exchange Offer contemplated by
the Registration Rights Agreement, whether or not required by the SEC, the
Issuer shall file a copy of all of the information and reports referred to in
clauses (1) and (2) above with the SEC for public availability within the time
periods specified in the SEC's rules and regulations (unless the SEC will not
accept such a filing) and make such information available to prospective
investors upon request. In addition, the Issuer and the Guarantors agree that
they shall furnish to the Holders and to prospective investors, upon the request
of such Holders, the information required to be delivered pursuant to Rule
144(d)(4) under the Securities Act so long as the Senior Secured Notes are not
freely transferable under the Securities Act.
Notwithstanding the foregoing, the Issuer shall not be required to present
financial information (i) for itself or any Subsidiary for any period prior to
September 30, 2003 that is not presented in
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the Offering Memorandum or (ii) pursuant to Rule 3-16 of Regulation S-X, in each
case, unless required to do so by the SEC in connection with the Exchange Offer.
The receipt by the Trustee of any such reports and documents
pursuant to this Section 4.03 shall not constitute notice or constructive notice
of any information contained in such documents or determinable from information
contained in such documents, including the Issuer's compliance with any
covenants hereunder (as to which the Trustee is entitled to rely exclusively on
an Officers' Certificate).
Section 4.04 Delivery of Notices to Trustee. The Issuer shall,
and shall cause each of its Subsidiaries to, so long as any of the Senior
Secured Notes are outstanding, deliver to the Trustee and the Collateral Agent,
forthwith upon any officer becoming aware of any Default, Event of Default,
Event of Loss, Event of Eminent Domain or Title Event or, an Officers'
Certificate specifying with particularity any such Default, Event of Default,
Event of Loss, Event of Eminent Domain or Title Event and, if applicable, what
action the Issuer is taking or proposes to take with respect thereto.
Section 4.05 Stay, Extension and Usury Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay, extension or usury law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance of
its obligations under this Indenture and the Senior Secured Notes; and the
Issuer (to the extent it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.
Section 4.06 Restrictions on Sale of Assets. The Issuer shall
not nor shall the Issuer permit any of its Subsidiaries to sell, lease (as
lessor) or transfer (as transferor) any property or assets (other than to a
Guarantor) except:
(a) in the ordinary course of business; or
(b) property which is worn out, obsolete or no longer useful or
necessary in connection with the operation of a Project as certified by the
Issuer, including the 50% undivided interest of Mammoth-Pacific in those certain
BLM geothermal resource leases XX 00000, XX 00000, XX 00000, XX 00000 and CA
11672 or the interest of Steamboat Development in that certain BLM Right of Way
N-77428 or as a result of the lapse of geothermal leases due to the failure to
commence commercial production of geothermal resources under such leases; or
(c) property comprising the Desert Peak 1 Plant and related real
estate rights if the Issuer improves the output of the other facility currently
located at the Xxxxx Plant or adds a facility on the Xxxxx site so that the
overall output of the facilities located at Xxxxx equals or exceeds the
aggregate of (i) the then current output of the Desert Peak 1 Plant plus (ii)
the current
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output of the other facility currently located at the Xxxxx Plant (the aggregate
of (i) and (ii) referred to as the "Combined Xxxxx Output"); provided, that
prior to any such sale, lease or transfer, (i) the Geothermal Consultant shall
have certified that after giving effect to such sale, lease or transfer, the
Xxxxx Plant has the necessary geothermal resources to enable the Xxxxx Plant to
produce the Combined Xxxxx Output through the Final Maturity Date (subject to
normal geothermal resource degradation in an amount no worse than that which is
projected for the Desert Peak 1 Plant) and (ii) the power purchase agreement
pursuant to which the Xxxxx Plant operates at such time continues to be in full
force and effect after giving effect to such sale, lease or transfer and
provides for delivery of output not less than the Combined Xxxxx Output.
The Collateral Agent shall be obligated to release the Lien of
the Security Documents upon the Issuer's transfer of any property or assets in
compliance with this covenant and receipt by the Collateral Agent of an
Officer's Certificate stating that such transfer is in compliance with this
covenant.
Section 4.07 Insurance. The Issuer shall, and shall cause each
of its Subsidiaries to, maintain or cause to be maintained business interruption
insurance, casualty insurance, including flood and earthquake coverage, and
primary and excess liability insurance, as well as customary worker's
compensation (upon hiring of employees) and automobile insurance and such other
insurance, if any, as is generally carried by companies engaged in similar
businesses and owning similar properties in the same general areas and financed
in a similar manner. To the extent any such casualty insurance covers both the
Issuer, its Subsidiaries and/or a Project, on the one hand, and any other owner
and/or plant, on the other hand, the Issuer shall ensure that it has
specifically designated as applicable solely to it, its Subsidiaries and the
Projects "all risk" property insurance coverage in an amount based upon the
estimated full replacement value of the Plants (provided that earthquake and
flood coverages may be subject to an annual aggregate limit with respect to the
Issuer and its Affiliates' facilities of not less than $5 million with respect
to flood and $10 million with respect to earthquake) and business interruption
insurance in an amount of not less than the maximum fixed expenses projected
over any four month period during the succeeding twelve month period (including,
without limitation, debt service expenses). The Issuer shall not, nor shall the
Issuer permit any of its Subsidiaries to, reduce or change such insurance
coverages if the Insurance Consultant determines that such reduction or
cancellation would not be reasonable under the circumstances and the insurance
coverages sought to be reduced or changed are available on commercially
reasonable terms or that another level of coverage greater than that proposed by
the Issuer is available on commercially reasonable terms (in which case such
coverage may be reduced to the higher of such available levels). The Issuer
shall, and the Issuer shall cause each of its Subsidiaries (other than Ormesa
prior to the Ormesa Support Date) to, cause the Collateral Agent to be named as
loss payee and/or as an additional insured, as appropriate; all insurance
policies shall provide for at least 30 days' written notice to the Collateral
Agent of a cancellation (except cancellation due to failure to pay premiums,
which may be on no less than 10 days prior written notice to the Collateral
Agent) or reduction in the amount of coverage or of a material change in
coverage.
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Section 4.08 Governmental Approvals; Title. The Issuer shall,
and shall cause each of its Subsidiaries to, at all times (i) obtain and
maintain in full force and effect the Governmental Approvals and other consents
and approvals required at any time in connection with the Issuer's business and
(ii) preserve and maintain good and valid title to our properties and assets
(subject to no Liens other than Permitted Liens), except in each case where the
failure to do so in clause (i) or (ii) could not reasonably be expected to have
a Material Adverse Effect.
Section 4.09 Limitation on Nature of Business. The Issuer
shall not, and shall not permit or cause any of its Subsidiaries to, engage or
enter into any business other than, directly or indirectly the ownership,
operation and maintenance of the Plants and activities incidental thereto.
Section 4.10 Prohibition on Merger or Other Fundamental
Changes. The Issuer shall not, nor shall it permit any of its Subsidiaries to,
enter into any transaction of merger or consolidation, sell all or substantially
all of its or their respective assets to any other Person (other than a merger,
consolidation or sale to or into the Issuer or any of the Guarantors), change
its or their respective forms of organization or its or their respective
businesses, liquidate or dissolve its or their self (or suffer any liquidation
or dissolution) or discontinue its or their respective businesses. The Issuer
shall not, nor shall it permit any of its Subsidiaries to, purchase or otherwise
acquire all or substantially all of the assets of any other Person (other than
(x) the acquisition of the Capital Stock of Mammoth-Pacific that the Issuer does
not own as of the Closing Date, (y) an acquisition by the Issuer or a Guarantor
of assets of another Guarantor and (z) the acquisition of a Qualified Project in
accordance with the terms of this Indenture).
Section 4.11 Restricted Payments. The Issuer shall not, nor
shall it permit or cause any of its Subsidiaries to, make any Restricted
Payments, except (i) if the Issuer meets the Distribution Conditions set forth
in Section 3.8(b) of the Depositary Agreement and has satisfied Sections 3.08
(d) and (e) hereof, if applicable, and (ii) Restricted Payments made by any of
its Subsidiaries; provided, that such Restricted Payments in the case of clause
(ii) are made to the Issuer or a Guarantor.
Section 4.12 Revenue Account. The Issuer shall, and it shall
cause each of its Subsidiaries (other than Ormesa prior to the Ormesa Support
Date) to, take all actions as may be necessary to cause all revenues actually
received by them from the Projects or otherwise to be deposited in the Revenue
Account to the extent required by the Depositary Agreement. The Issuer shall,
and shall cause its Subsidiaries (other than Ormesa prior to the Ormesa Support
Date) to (x) provide irrevocable written instruction to each power purchaser
related to a Project, to pay all revenues paid under power purchase agreements
with respect to the Projects directly into the Revenue Account (other than with
respect to the Mammoth Plant; provided, however, if at any time the Issuer or
any Guarantor acquires that portion of the Capital Stock of Mammoth-Pacific that
the Issuer does not own as of the Closing Date or the Issuer otherwise acquires
control of 100% of the Mammoth Project, the Issuer shall, or the Issuer shall
cause such Guarantor, as the case may be, to arrange for all revenues paid under
power purchase agreements with respect to the Mammoth Project to be paid
directly into the Revenue Account), (y) use
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commercially reasonable efforts to arrange for all other revenues to be paid
directly into the Revenue Account and (z) cause any other revenues received by
the Issuer or any of its Subsidiaries to be promptly paid into the Revenue
Account.
Section 4.13 Transactions with Affiliates. The Issuer shall
not, and shall not permit any of its Subsidiaries to, make any payment to, or
sell, lease, transfer or otherwise dispose of any of its respective properties
or assets to, or purchase any property or assets from, or enter into or make or
amend any transaction, contract, agreement, understanding, loan, advance or
guarantee with, or for the benefit of, any of its respective Affiliates (each,
an "Affiliate Transaction"), unless:
(a) the Affiliate Transaction is on terms that are no less
favorable to the Issuer or the relevant Subsidiary than those that
would have been obtained in a comparable transaction by the Issuer or
such Subsidiary with an unrelated Person; and
(b) the Issuer delivers to the Trustee:
(i) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate
consideration in excess of $5 million, a resolution of the
Board of Directors set forth in an Officers' Certificate
certifying that such Affiliate Transaction complies with this
covenant and that such Affiliate Transaction has been approved
by a majority of the Board of Directors; and
(ii) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate
consideration in excess of $25 million, a positive opinion as
to the fairness to the Issuer of such Affiliate Transaction
from a financial point of view issued by an accounting,
appraisal or investment banking firm of national standing. The
Trustee shall have no obligation to review the fairness
opinion, but shall hold such opinion for the benefit of the
Holders.
The following items shall not be deemed to be Affiliate
Transactions and, therefore, shall not be subject to the provisions of the prior
paragraph:
(a) any employment agreement, employee benefit plan, officer
and director indemnification agreement or any similar arrangement
entered into by the Issuer or any of its Subsidiaries in the ordinary
course of business;
(b) transactions between or among the Issuer and/or its
Wholly-Owned Subsidiaries;
(c) payment of reasonable directors' fees to Persons who are
not otherwise Affiliates of the Issuer;
(d) Restricted Payments that do not violate the provisions of
Section 4.11 of this Indenture;
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(e) loans or advances to employees in the ordinary course of
business not to exceed $1.0 million in the aggregate at any one time
outstanding;
(f) transactions pursuant to written agreements with the
Issuer's Affiliates in place as of the date of this Indenture;
(g) the transfer of the 50% undivided interest of OrMammoth in
those certain BLM geothermal resource leases XX 00000, XX 00000, XX
00000, XX 00000 and CA 11672 or the interest of Steamboat Development
in that certain BLM Right of Way N-77428 to any Affiliate of the
Issuer;
(h) any amendments, modifications or replacements of, or
waivers under, any written agreement described under clause (f) of this
paragraph that is not a Material Project Document; provided that no
such amendment, modification or waiver alters any such agreement in a
manner than is materially adverse to the interests of Holders; and
(i) any agreement to do anything set forth in items (a)
through (h) of this paragraph.
Section 4.14 Exercise of Rights. The Issuer shall not, and
shall not permit any of its Subsidiaries to, exercise, or fail to exercise, its
or their respective rights under the Project Documents in a manner which could
reasonably be expected to result in a Material Adverse Effect with respect to
the Issuer or the applicable Subsidiary. The Issuer shall, and shall cause each
of its Subsidiaries to, diligently pursue all rights to distributions or
dividends and Loss Event Proceeds, Eminent Domain Proceeds and Title Proceeds
upon the occurrence of a Loss Event, an Event of Eminent Domain or a Title
Event, as the case may be.
Section 4.15 Termination or Amendment to Material Project
Documents. The Issuer shall not, and shall not permit any of its Subsidiaries
to, terminate, amend in any material adverse respect, replace, modify in any
material adverse respect or assign, other than pursuant to the Security
Documents (or consent to any of the foregoing) any of the Material Project
Documents to which the Issuer or they are a party, provided that (x) Material
Project Documents may be terminated so long as the Issuer enters into one or
more replacement agreements, and (y) the Issuer's Subsidiaries may terminate
Material Project Documents with respect to the rights and obligations of the
Desert Peak 1 Plant if the Issuer improves the output of the Xxxxx Plant and
otherwise complies with the provisions set forth in Section 4.06(c) of this
Indenture.
Section 4.16 Additional Project Documents. The Issuer shall
not, and shall not permit any of its Subsidiaries to, enter into any Additional
Project Documents (a) if entering into such document could reasonably be
expected to result in a Material Adverse Effect, provided, however, that nothing
in the foregoing is intended to preclude the Issuer or any of its Subsidiaries
from entering into agreements to sell Renewable Energy Credits in connection
with any Project as contemplated by the terms of the Project Documents or
required by Applicable Law or (b) if entering into any such Additional Project
Document constituting power purchase agreements,
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fuel supply and transportation agreements, transmission agreements and other
agreements, contracts or other arrangements for the purchase of fuel for, or the
sale of electricity from, the Project results in the breach of, or conflict with
the terms of, any then-existing power purchase agreement.
Section 4.17 Performance of Project Documents. The Issuer
shall, and shall cause each of its Subsidiaries to, perform and observe their
respective covenants and obligations under all of the Project Documents, except
where the failure to do so could not reasonably be expected to result in a
Material Adverse Effect. Section 4.18 Limitations on Indebtedness. The Issuer
shall not create, incur or suffer to exist any Indebtedness except the following
Indebtedness (collectively, "Permitted Indebtedness"):
(a) Indebtedness represented by the Senior Secured Notes to be
issued on the Closing Date and the Exchange Notes to be issued pursuant
to the Registration Rights Agreement;
(b) Indebtedness incurred by the Issuer to (x) make capital
improvements to a Project that are required by law or the terms of the
Project Documents, and (y) purchase that portion of the Capital Stock
of Mammoth-Pacific that the Issuer does not own as of the Closing Date;
provided, that:
(i) no Default or Event of Default has occurred and
is continuing at the time such Indebtedness is proposed to be
incurred or would result from the incurrence of such
additional Indebtedness; and
(ii) (1) the Issuer's calculations demonstrate that
after giving effect to the incurrence of such additional
Indebtedness, the minimum projected Debt Service Coverage
Ratio for each Annual Period (each such period taken as a
single accounting period) following the Quarterly Period in
which such additional Indebtedness is incurred through the
Final Maturity Date (provided, however, (x) with respect to
Indebtedness incurred within one year of the Final Maturity
Date, the period tested shall be a period commencing on the
first day of the Quarterly Period immediately following such
incurrence and ending on the Final Maturity Date, and (y) with
respect to the Annual Period in which such Indebtedness is
incurred (unless such Indebtedness is incurred on the first
day of such Annual Period), the first period tested shall be
the period commencing with the first day of the Quarterly
Period immediately following such incurrence and ending on the
last day of the Annual Period in which such Indebtedness is
incurred), shall not be less than 1.40 to 1.0; and (2) the
Issuer shall have delivered a certificate to the Collateral
Agent confirming the foregoing clause (b)(i) and clause
(b)(ii)(1) and stating that the Capital Expenditures proposed
by the Issuer conform to such legal or Project Document
requirements;
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(c) Indebtedness incurred by the Issuer to make discretionary
capital improvements to a Project, provided, that:
(i) no Default or Event of Default has occurred and
is continuing at the time such Indebtedness is proposed to be
incurred or would result from the incurrence of such
additional Indebtedness; and
(ii) (1) the Issuer's calculations demonstrate that
(x) the minimum projected Debt Service Coverage Ratio for each
Annual Period through the Final Maturity Date and (y) the
average projected Debt Service Coverage Ratio for the Annual
Periods through the Final Maturity Date, equals or exceeds the
projected Debt Service Coverage Ratio for the corresponding
Annual Period or Annual Periods, as the case may be,
immediately prior to the incurrence of such additional
Indebtedness and the making of any such capital improvement
(provided, however, (i) with respect to Indebtedness incurred
within one year of the Final Maturity Date, the period tested
shall be a period commencing on the first day of the Quarterly
Period immediately following such incurrence and ending on the
Final Maturity Date, and (ii) with respect to the Annual
Period in which such Indebtedness is incurred (unless such
Indebtedness is incurred on the first day of such Annual
Period), the first period tested shall be the period
commencing with the first day of the Quarterly Period
immediately following such incurrence and ending on the last
day of the Annual Period in which such Indebtedness is
incurred) and (2) the Issuer shall have delivered a
certificate to the Collateral Agent confirming the foregoing
clause (c)(i) and clause (c)(ii)(1);
(d) additional Indebtedness incurred by the Issuer not to
exceed an aggregate principal amount outstanding at any time of $10
million;
(e) Subordinated Debt;
(f) Indebtedness incurred by the Issuer in order to refinance
existing Indebtedness incurred pursuant to clause (b), (c) or (e)
above, provided, (1) such refinancing Indebtedness has an average life
equal to or greater than the average life of the Indebtedness being
refinanced, (2) the aggregate amount of such refinancing Indebtedness
does not exceed the principal amount of the Indebtedness being
refinanced and (3) to the extent that the original incurrence of the
refinanced Indebtedness was subject to certain conditions and
requirements pursuant to this Indenture, such refinancing Indebtedness
shall comply with all of the conditions and requirements applicable to
the refinanced Indebtedness;
(g) Indebtedness outstanding under the Ormesa Credit Agreement
prior to the Ormesa Support Date; and
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(h) additional Senior Secured Notes issued by the Issuer to
purchase not more than one Qualified Project through the Final Maturity
Date of the Senior Secured Notes; provided, that:
(i) no Default or Event of Default has occurred and
is continuing at the time such Indebtedness is proposed to be
incurred or would result from the incurrence of such
additional Indebtedness;
(ii) no Indebtedness (other than the Senior Secured
Notes and Subordinated Debt issued under the Ormat Nevada
Subordinated Loan) is incurred or assumed in connection with
the purchase of the Qualified Project;
(iii) (1) the Issuer's calculations demonstrate that
the minimum projected Debt Service Coverage Ratio for each
Annual Period (each such period taken as a single accounting
period) following the Quarterly Period in which such
additional Indebtedness is incurred through the Final Maturity
Date (provided, however, (i) with respect to Indebtedness
incurred within one year of the Final Maturity Date, the
period tested shall be the period commencing on the first day
of the Quarterly Period immediately following such incurrence
and ending on the Final Maturity Date, and (ii) with respect
to the Annual Period in which such Indebtedness is incurred
(unless such Indebtedness is incurred on the first day of such
Annual Period), the first period tested shall be the period
commencing with the first day of the Quarterly Period
immediately following such incurrence and ending on the last
day of the Annual Period in which such Indebtedness is
incurred), shall not be less than 1.55 to 1.0, and (2) the
Issuer shall have delivered a certificate to the Collateral
Agent confirming the foregoing clauses (h)(i), (h)(ii), and
clause (h)(iii)(1) and stating that the Project acquired is a
Qualified Project.
Section 4.19 Limitation on Indebtedness of Subsidiaries. The
Issuer shall not permit any of its Subsidiaries to create, incur or suffer to
exist any Indebtedness other than (i) Indebtedness owed to the Issuer
represented by an intercompany note and (ii) Indebtedness represented by the
Guarantees.
Section 4.20 Limitations on Guarantees. The Issuer shall not,
and shall not permit any of its Subsidiaries to, contingently or otherwise, be
or become liable in connection with any Guarantee, except for (i) endorsements
and similar obligations in the ordinary course of business and (ii) Guarantees
of the Senior Secured Notes.
Section 4.21 Prohibitions on Other Obligations or Assignments.
The Issuer shall not, and shall not permit any of its Subsidiaries to, assign
any of its or its Subsidiaries' respective rights or obligations under any
Financing Document.
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Section 4.22 Books and Records, Inspection. The Issuer shall,
and shall cause each of its Subsidiaries to, maintain books and records in
accordance with GAAP and provide the Trustee, the Collateral Agent and the
Independent Engineer with reasonable inspection rights with respect to the
Projects and such books and records.
Section 4.23 Maintenance of Existence. The Issuer shall, and
shall cause each of its Subsidiaries to, do or cause to be done all things
necessary to preserve and keep in full force and effect its and their (i)
existence and good standing under the laws of their respective states of
organization, in accordance with their organizational documents (as the same may
be amended from time to time), (ii) qualification to do business in each
jurisdiction in which the character of the properties owned or leased by it or
in which the transaction of its business as conducted or proposed to be
conducted makes such qualification necessary and (iii) powers, rights (charter
and statutory), privileges, licenses and franchises with respect to the Projects
except where the failure to maintain any of the foregoing in clause (iii) could
not reasonably be expected to have a Material Adverse Effect.
Section 4.24 Additional Documents; Filings and Recordings. The
Issuer shall, and shall cause each of its Subsidiaries to, execute and deliver,
as requested by the Trustee or the Collateral Agent, such other documents as
shall reasonably be necessary or advisable in order to effect or protect the
rights and remedies of the Trustee or the Collateral Agent, as the case may be,
granted or provided for by the Security Documents to which the Issuer is a party
and to consummate the transactions contemplated therein. The Issuer shall, at
its own expense, take all reasonable actions (a) that are requested by the
Trustee or the Collateral Agent, or (b) that an Authorized Officer of the Issuer
has actual knowledge are necessary as a legal matter, to establish, maintain and
perfect the first priority security interests of Trustee and the Collateral
Agent in the Collateral, subject to Permitted Liens. Without limiting the
generality of the foregoing, the Issuer shall execute or cause to be executed
and shall file or cause to be filed such financing statements, continuation
statements, and fixture filings and such mortgages, or deeds of trust in all
places necessary or advisable to establish, maintain and perfect the Liens
purported to be provided for in the Security Documents, subject to Permitted
Liens.
Section 4.25 Dividend and Other Payment Restrictions Affecting
Subsidiaries. The Issuer shall not, nor shall it permit any of its Subsidiaries
to, directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any of its Subsidiaries
to:
(a) pay dividends or make any other distributions on its
Capital Stock to the Issuer or any of its Subsidiaries, or with respect
to any other interest or participation in, or measured by, its profits,
or pay any Indebtedness owed to the Issuer or any of its Subsidiaries;
(b) make loans or advances to the Issuer or any of its
Subsidiaries; or
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(c) transfer any of its properties or assets to the Issuer or
any of its Subsidiaries.
However, the preceding restrictions shall not apply to
encumbrances or restrictions existing under or by reason of:
(a) any of the Financing Documents;
(b) Applicable Law;
(c) customary non-assignment provisions in contracts,
agreements, leases, permits or licenses entered into or issued in the
ordinary course of business and consistent with past practices;
(d) purchase money obligations for property acquired in the
ordinary course of business and Capital Lease Obligations that impose
restrictions on the property purchased or leased of the nature
described in clauses (a) and (c) of the preceding paragraph;
(e) Indebtedness incurred pursuant to clause (f) of the
definition of Permitted Indebtedness; provided that the restrictions
contained in the agreements governing such Indebtedness are not
materially more restrictive, taken as a whole, than those contained in
the agreements governing the Indebtedness being refinanced;
(f) Liens securing Indebtedness otherwise permitted to be
incurred under Section 4.27 that limit the right of the debtor to
dispose of the assets subject to such Liens or to use the proceeds of
any such disposition; and
(g) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary
course of business.
Section 4.26 Budget And Expenditures. The Issuer shall, and
shall cause each of its Subsidiaries to, deliver, at its own expense, an annual
Operating Budget to the Trustee, the Collateral Agent and the Independent
Engineer at least 30 days prior to the beginning of each fiscal year of the
Issuer.
Section 4.27 Limitation on Liens. The Issuer shall not, and
shall not permit any of its Subsidiaries to, grant, create, incur or suffer to
exist any Liens upon any of its or their assets, except for the Permitted Liens.
Section 4.28 Compliance With Laws. The Issuer shall, and shall
cause each of its Subsidiaries to, comply with all applicable laws and
Governmental Approvals, except where non-compliance could not reasonably be
expected to have a Material Adverse Effect.
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Section 4.29 Operation and Maintenance. The Issuer shall, and
shall cause each of its Subsidiaries to, at all times maintain and operate each
Project in compliance with Prudent Industry Practices.
Section 4.30 Additional Subsidiaries; Bank Accounts. The
Issuer shall own at all times, directly or indirectly, 100% of the issued and
outstanding Capital Stock of each of its Subsidiaries. The Issuer shall own at
all times directly or indirectly, not less than 50% of the issued and
outstanding Capital Stock of Mammoth-Pacific. The Issuer shall not, and shall
not permit any of its Subsidiaries to, acquire or create any additional
Subsidiaries; provided, however, this shall not limit the Issuer's ability or
the ability of any Guarantor to create a Wholly-Owned Subsidiary that becomes a
Guarantor in accordance with Article IX of the Indenture by execution of a
Supplemental Indenture in the form of Exhibit G hereto on or prior to the date
of acquisition, to (i) acquire the Capital Stock of Mammoth-Pacific that the
Issuer does not own as of the Closing Date or (ii) acquire a Qualified Project
in accordance with the terms of this Indenture. The Issuer shall not, and shall
not permit any of its Subsidiaries to, establish any bank account other than the
Accounts and not more than two checking accounts (each, a "Checking Account"),
provided that the Secured Parties shall have a perfected security interest in
such Checking Accounts pursuant to an agreement which is reasonably satisfactory
to the Collateral Agent.
Section 4.31 Maintenance of Water Supply; Access Rights. The
Issuer shall, and shall cause its Subsidiaries to, at all times maintain in full
force and effect the agreements and other arrangements to ensure that (i) the
Projects have a constant and continuous supply of water to the extent necessary
to permit the operation of the Projects at levels contemplated in the
Projections and (ii) the Projects have such real estate rights as may be
necessary to ensure the ingress to and egress from each of the Projects.
Section 4.32 No Abandonment. The Issuer shall, and shall cause
its Subsidiaries not to permit the occurrence of any Event of Abandonment.
Section 4.33 Consents to Assignment of Unassigned Leases
Additional Project Documents. The Issuer shall, and shall cause its Subsidiaries
to, use its commercially reasonable efforts to obtain executed consents to the
assignment of each Unassigned Lease and each Additional Project Document.
Section 4.34 Loans. The Issuer shall not, and shall not permit
its Subsidiaries to, make any loan or advance other than in the ordinary course
of business (other than a loan or advance to a Guarantor that constitutes
Indebtedness owed to the Issuer and that is represented by an intercompany
note); provided, however, the Issuer may direct the investment of funds on
deposit in the accounts in Permitted Investments in accordance with the terms of
the Financing Documents.
Section 4.35 Amendments to Organizational Documents. The
Issuer shall not, and shall cause its Subsidiaries not to, amend, modify or
supplement its or their Organizational
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Documents except such amendments as (i) could not reasonably be expected to
result in a Material Adverse Effect and (ii) could not reasonably be expected to
adversely affect any provisions of such organizational documents that relate to
the bankruptcy remoteness of the Issuer.
Section 4.36 Removal of Independent Consultant. The Issuer
shall not remove or otherwise replace any of the Independent Consultants;
provided that any Independent Consultant may be replaced or removed by the
Issuer at any time (i) in the event that any such Independent Consultant shall
have become incapable of acting or performing its services, or otherwise fails
to perform its function as the Independent Consultant in the manner contemplated
by this Indenture and the other Financing Documents, or shall have been adjudged
bankrupt or insolvent, or a receiver of such Independent Consultant or of its
property shall have been appointed, or any public office shall have taken
control or charge of such Independent Consultant or its property or affairs for
the purpose of rehabilitation, conservation or liquidation at any time or (ii)
so long as the Issuer shall have certified to the Trustee (which certification
shall have been delivered by an Authorized Representative of the Issuer) that
the replacement Independent Consultant being retained to perform the services of
the removed or replaced Independent Consultant is properly qualified to perform
such services at least to the same degree, extent and quality as the replaced or
removed Independent Consultant and the same could not reasonably be expected to
materially adversely affect the rights of the Holders.
Section 4.37 Payments for Consent. The Issuer shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly, pay or
cause to be paid any consideration to or for the benefit of any holder of Senior
Secured Obligations for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of any Financing Document unless such
consideration is offered to be paid and is paid to all Holders of Senior Secured
Notes that consent, waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or agreement.
Section 4.38 Limitations on Ormesa. On the Ormesa Support
Date, the Issuer shall cause Ormesa to provide a Lien on substantially all of
its property in favor of the Collateral Agent (including, without limitation,
the consent of Southern California Edison) pursuant to the terms of the Security
Agreement and to execute a Guarantee in accordance with Article IX of this
Indenture by execution of a Supplemental Indenture in the form of Exhibit G
hereto. The Issuer shall not grant any Liens on the Capital Stock it holds of
Ormesa except to the Collateral Agent and shall not permit Ormesa to incur any
Indebtedness or become subject to any Lien other than the Liens contemplated in
this Section 4.38 and Liens under the Ormesa Credit Agreement.
Section 4.39 Limitation on Issuance and Sale of Capital Stock
of Subsidiaries. The Issuer shall not permit any of its Subsidiaries to
transfer, convey, sell or otherwise dispose of Capital Stock in any of its
Subsidiaries to any Person, other than the Issuer or one of the Guarantors.
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Section 4.40 Maintenance of Qualifying Facility Status. The
Issuer shall, and shall cause each of its Operating Subsidiaries to, operate and
maintain each Plant as a Qualifying Facility.
Section 4.41 Payment of taxes and claims. The Issuer shall and
shall cause each of its Subsidiaries to pay and discharge (a) all taxes,
assessments and governmental charges or levies imposed upon it, or upon its
income or profits, or upon any of its properties before they shall become
delinquent, (b) all lawful claims (including claims for labor, materials and
supplies) which, if unpaid, could reasonably be expected to give rise to a Lien
upon any of its properties; and (c) except as prohibited under the Financing
Documents, all of its other Indebtedness as it shall become due; provided,
however, neither the Issuer nor its Subsidiaries shall be required to pay any
such tax, assessment, charge, levy, claim or Indebtedness which is being
contested in good faith by appropriate proceedings, as to which adequate
reserves have been established in accordance with GAAP, unless the failure to
make such payment (i) could reasonably be expected to give rise to an immediate
right to foreclose on a Lien securing such amounts or (ii) could reasonably be
expected to have a Material Adverse Effect.
Section 4.42 Repayment of Ormesa Credit Agreement. As
consideration for the Lien and Guarantees to be provided by Ormesa pursuant to
Section 4.38 hereof, a portion of the proceeds of the Initial Notes shall be
deposited in the Ormesa Repayment Account and the Issuer shall use its
commercially reasonable efforts to cause the Ormesa Credit Agreement to be
repaid in full with proceeds from the Ormesa Repayment Account or otherwise in
accordance with the Depositary Agreement and cause all liabilities of Ormesa
under the Ormesa Credit Agreement to be discharged on or prior to January 31,
2005.
Section 4.43 Provision of Additional Liens. The Issuer shall
cause Liens to be provided in favor of the Collateral Agent and the relevant
Guarantor shall become party to the Security Documents with respect to (i) the
Mammoth Plant if, at any time, the Issuer or one of the Guarantors acquires that
portion of the Capital Stock of Mammoth-Pacific that the Issuer or the
Guarantors do not own as of the Closing Date, or the Issuer or one of the
Guarantors otherwise acquires control of 100% of the interests in the Mammoth
Plant and (ii) a Qualified Project upon an acquisition of a Qualified Project.
Section 4.44 Galena Re-powering. The Issuer shall, and shall
cause its Subsidiaries to, use their commercially reasonable efforts to effect
the Galena Re-Powering.
Section 4.45 Title Policies. The Issuer shall use its
commercially reasonable efforts to remove any survey exceptions with respect to
Title Policies.
Section 4.46 Preservation of Liens. The Issuer shall take all
actions and shall cause it Subsidiaries to take all actions necessary to
preserve the validity, perfection and priority of the Liens and security
interests in the Collateral created pursuant to the Security Documents.
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Section 4.47 Title Reports. In connection with all real estate
over which the Collateral Agent holds a Deed of Trust, the Issuer shall provide
to the Collateral Agent a title report and title policy, including endorsements,
or title opinion in form and substance satisfactory to the Collateral Agent, and
evidence that the Deed of Trust has been filed for recording; provided, that,
subject to Section 4.45 hereof, such title policies may contain a survey
exception.
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.01 Events of Default. The following events
constitute an "Event of Default" under this Indenture:
(a) the failure to pay or cause to be paid any principal of,
interest, premium, Liquidated Damages, if any, fees or any other obligations on
the Senior Secured Notes for five or more days after the same becomes due and
payable, whether by scheduled maturity or required prepayment or by acceleration
or otherwise;
(b) any representation or warranty made by the Issuer, any
Subsidiary or Ormat Nevada under any Financing Document shall prove to have been
untrue or misleading as of the time made, confirmed or furnished and the fact,
event or circumstance that gave rise to such inaccuracy has had or could
reasonably be expected to result in a Material Adverse Effect and such fact,
event or circumstance shall continue to be uncured for 30 or more days from the
date a Responsible Officer of the Issuer, such Subsidiary or Ormat Nevada, as
the case may be, obtains knowledge thereof; provided, that if the Issuer, such
Subsidiary or Ormat Nevada, as the case may be, commences efforts to cure such
fact, event or circumstance within such 30-day period, the Issuer, such
Subsidiary or Ormat Nevada, as the case may be, may continue to effect such cure
and such misrepresentation will not be deemed an Event of Default for an
additional 90 days so long as the Issuer, such Subsidiary or Ormat Nevada, as
the case may be, is diligently pursuing such cure;
(c) the failure by the Issuer or any Subsidiary to perform or
observe any covenant contained in Sections 4.06, 4.07, 4.09, 4.10, 4.11, 4.15,
4.16, 4.18, 4.19, 4.20, 4.23, 4.27 and 4.46 and such failure shall continue
uncured for 30 or more days after a Responsible Officer of the Issuer obtains
knowledge thereof;
(d) the failure by the Issuer, any Subsidiary or Ormat Nevada
to perform or observe any of the other covenants in the Financing Documents that
the Issuer, such Subsidiary or Ormat Nevada is a party to (other than such
failures described in clause (a) or (c) above) and such failure shall continue
uncured for 30 or more days after a Responsible Officer of the Issuer, any
Subsidiary or Ormat Nevada, as the case may be, obtains knowledge thereof;
provided that if the Issuer, any Subsidiary or Ormat Nevada, as the case may be,
commence efforts to cure such default within such 30-day period, the Issuer, any
Subsidiary or Ormat Nevada, as the case may
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be, may continue to effect such cure of the default and such default will not be
deemed an Event of Default for an additional 90 days so long as the Issuer, any
Subsidiary or Ormat Nevada, as the case may be, is diligently pursuing such
cure;
(e) the Issuer or any Subsidiary of the Issuer:
(i) admits in writing its inability, or is generally
unable, to pay its debts as the debts become due
or makes a general assignment for the benefit of
creditors; or
(ii) commences any case, proceeding or other action
seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its
debts under any applicable liquidation,
conservatorship, bankruptcy, moratorium, arrangement,
adjustment, insolvency, reorganization or similar
laws affecting the rights or remedies of creditors
generally, as in effect from time to time
(collectively, "Debtor Relief Law"); or
(iii) in any involuntary case, proceeding or other action
commenced against it which seeks to have an order for
relief (injunctive or otherwise) entered against it,
as debtor, or seeks reorganization, arrangement,
adjustment, liquidation, dissolution or composition
of it or its debts under any Debtor Relief Law, (A)
fails to obtain a dismissal of such case, proceeding
or other action within ninety (90) days of its
commencement, or (B) converts the case from one
chapter of the Bankruptcy Reform Act of 1978, as
amended, to another chapter, or (C) is the subject of
an order for relief that remains unstayed and in
effect for a period of ninety (90) days; or
(iv) has a trustee, receiver, custodian or other official
appointed for or to take possession of all or any
part of its property or has any court take
jurisdiction of any of its property, which action
remains undismissed for a period of ninety (90) days;
(f) the entry of one or more final and non-appealable judgment
or judgments for the payment of money in excess of $10.0 million (exclusive of
judgment amounts covered by insurance) against the Issuer or any Subsidiary,
which remain unpaid or unstayed for a period of 60 or more consecutive days;
(g) an event of default under any Permitted Indebtedness
(other than Indebtedness referred to in clause (a) above) that results in
Indebtedness in excess of $10.0 million becoming due and payable prior to its
stated maturity;
(h) any Governmental Approval required for the operation of
any Project or any material portion thereof owned by the Issuer or any
Subsidiary is revoked, terminated,
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withdrawn or ceases to be in full force and effect if such revocation,
termination, withdrawal or cessation has had or could reasonably be expected to
have a Material Adverse Effect and such revocation, termination, withdrawal or
cessation is not cured within 60 days following the occurrence thereof;
(i) any Material Project Document or Third Party Consent or
any material provision thereof (i) ceases to be valid and binding and in full
force and effect prior to its stated maturity date other than as a result of an
amendment or termination permitted under this Indenture or (ii) a party thereto
fails to perform or observe any of its covenants or obligations thereunder or
makes any material misrepresentation thereunder and such event has had or could
reasonably be expected to have a Material Adverse Effect; provided that, in any
such event no such event shall be an Event of Default if within 180 days from
the occurrence of any such event, (a) such Material Project Document or Third
Party Consent or material provision thereof is reinstated as a valid and binding
agreement among the parties thereto, (b) any breaching party resumes performance
and otherwise cures such misrepresentation or failure to perform or observe its
covenants or obligations under the Material Project Documents or Third Party
Consents or (c) in the case of Material Project Documents, the Issuer enters
into an Additional Project Document in replacement thereof, as permitted under
this Indenture;
(j) any of the Security Documents or any other Financing
Document ceases to be in full force and effect or any Lien granted therein
ceases to be a valid and perfected Lien in favor of the Secured Parties on the
Collateral described therein with the priority purported to be created thereby;
provided, however, that the Issuer shall have 10 days after any of the Issuer or
its Subsidiaries' Responsible Officers obtains knowledge thereof to cure any
such cessation or to furnish to the Trustee, the Collateral Agent or the
Depositary all documents or instruments required to cure any such cessation;
(k) the occurrence of a Change of Control; or
(l) the failure of Ormesa to prepay all of the amounts
outstanding under the Ormesa Credit Agreement on or prior to January 31, 2005 or
the failure of the Issuer to cause Ormesa to comply with its obligations under
Sections 4.20 and 4.38 of this Indenture.
Section 5.02 Enforcement of Remedies
(a) If one or more Events of Default have occurred and are
continuing, then:
(i) in the case of an Event of Default described in clause (e)
above with respect to the Issuer, the entire outstanding principal
amount of the Senior Secured Notes, all interest and Liquidated
Damages, if any, accrued and unpaid thereon, and all premium, if any,
and other amounts payable under this Indenture, if any, shall
automatically become due and payable without presentment, demand,
protest or notice of any kind; or
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(ii) in the case of an Event of Default described in:
(A) clause (a) above, upon the written direction
of the Holders of no less than 25% in
aggregate principal amount of the
Outstanding Senior Secured Notes, the
Trustee shall declare the outstanding
principal amount of the Senior Secured Notes
to be accelerated and due and payable and
all interest and Liquidated Damages, if any,
accrued and unpaid thereon, and all premium,
if any, and other amounts payable under this
Indenture, if any, to be due and payable; or
(B) clause (b), (c), (d), (e) (with respect to
our Subsidiaries), (f), (g), (h), (i), (j),
(k) or (l) above, upon the written direction
of the Required Holders, the Trustee shall
declare the outstanding principal amount of
the Senior Secured Notes to be accelerated
and due and payable and all interest and
Liquidated Damages, if any, accrued and
unpaid thereon, and all premium, if any, and
other amounts payable under this Indenture,
if any, to be due and payable.
(b) At any time after the principal of the Senior Secured
Notes has become due and payable upon a declared acceleration, and before any
judgment or decree for the payment of the money so due, or any portion thereof,
has been entered, the Required Holders, by written notice to the Issuer and the
Trustee, shall rescind and annul such declaration and its consequences if:
(i) there has been paid to or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest and Liquidated Damages,
if any, on the Senior Secured Notes,
(B) the principal of and premium, if any, on any
Senior Secured Notes that have become due
(including overdue principal) other than by
such declaration of acceleration and
interest thereon at the respective rates
provided in the Senior Secured Notes for
overdue principal;
(C) to the extent that payment of such interest
is lawful, interest upon overdue interest
and Liquidated Damages, if any, at the
respective rates provided in the Senior
Secured Notes for overdue interest; and
(D) all sums paid or advanced by the Trustee and
the Collateral Agent and the reasonable
compensation, expenses, disbursements, and
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advances of the Trustee, the Depositary, the
Collateral Agent and their respective agents
and counsel; and
(ii) all Events of Default, other than the nonpayment of the
principal of the Senior Secured Notes that has become due solely by
such acceleration, have been cured or waived in accordance with this
Indenture.
(c) If an Event of Default has occurred and is continuing and
an acceleration has occurred, the Trustee may (as the Required Holders request)
direct the Collateral Agent to take possession of any or all of the Collateral
or to exercise any or all other rights of the Secured Parties under the Security
Documents.
If an Event of Default occurs and is continuing and is
actually known to a Responsible Officer of the Trustee, the Trustee will mail to
each Holder notice of the Event of Default within 30 days after the occurrence
thereof. Except in the case of an Event of Default in payment of principal of,
interest, premium or Liquidated Damages, if any, on any Senior Secured Note, the
Trustee may withhold the notice to the Holders if the Trustee in good faith
determines that withholding the notice is in the interest of the Holders.
If an Event of Default relating to failure to pay amounts owed
on the Senior Secured Notes has occurred and is continuing, the Trustee may
declare the principal amount of the Outstanding Senior Secured Notes, all
interest accrued and unpaid thereon, and all premium and Liquidated Damages, if
any, and other amounts payable under the Senior Secured Notes and this
Indenture, if any, to be due and payable notwithstanding the absence of written
direction from Holders of at least 25% in aggregate principal amount of the
Outstanding Senior Secured Notes directing the Trustee in writing to accelerate
the principal maturity of the Senior Secured Notes, unless the Required Holders
direct the Trustee not to accelerate the maturity of such Senior Secured Notes,
if in the good faith exercise of its discretion the Trustee determines that such
action is necessary to protect the interests of the Holders.
In addition, if one or more of the Events of Default referred
to in clause (a)(ii)(B) of this Section 5.02 has occurred and is continuing, the
Trustee may declare the entire principal amount of the Outstanding Senior
Secured Notes, all interest accrued and unpaid thereon, and all premium and
Liquidated Damages, if any, and other amounts payable under the Senior Secured
Notes and this Indenture, if any, to be due and payable notwithstanding the
absence of written direction from the Required Holders directing the Trustee to
accelerate the maturity of the Senior Secured Notes, unless the Required Holders
direct the Trustee not to accelerate the maturity of the Senior Secured Notes,
if in the good faith exercise of its discretion the Trustee determines that such
action is necessary to protect the interests of the Holders.
Section 5.03 Other Remedies. If an Event of Default occurs and
is continuing, the Trustee may pursue any available remedy to collect the
payment of principal, interest, premium, and Liquidated Damages, if any, on the
Senior Secured Notes or to enforce the performance of any provision of the
Senior Secured Notes or this Indenture.
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The Trustee may maintain a proceeding even if it does not
possess any of the Senior Secured Notes or does not produce any of them in the
proceeding. A delay or omission by the Trustee or any Holder of a Senior Secured
Note in exercising any right or remedy accruing upon an Event of Default shall
not impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. All remedies are cumulative to the extent permitted by law.
Section 5.04 Waiver of Past Defaults. Required Holders by
notice to the Trustee may on behalf of the Holders of all of the Senior Secured
Notes waive an existing Default or Event of Default and its consequences
hereunder, except a continuing Default or Event of Default in the payment of the
principal of, premium, Liquidated Damages if any, or interest on, the Senior
Secured Notes; provided, however, that the Required Holders may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration. Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
Section 5.05 Control by Majority. The Required Holders have
the right to direct the time, place and method of conducting any proceeding for
any right or remedy available to the Trustee or exercising any trust or power
conferred on the Trustee in this Indenture.
Section 5.06 Limitation on Suits. A Holder of a Senior Secured
Note may pursue a remedy with respect to this Indenture or the Senior Secured
Notes only if:
(a) the Holder of a Senior Secured Note gives to the Trustee
written notice of a continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal amount
of the then outstanding Senior Secured Notes make a written request to the
Trustee to pursue the remedy;
(c) such Holder of a Senior Secured Note or Holders of Senior
Secured Notes offer and, if requested, provide to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested, the provision
of indemnity; and
(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Senior Secured Notes do not give the
Trustee a direction inconsistent with the request.
A Holder of a Senior Secured Note may not use this Indenture
to prejudice the rights of another Holder of a Senior Secured Note or to obtain
a preference or priority over another Holder of a Senior Secured Note.
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Section 5.07 Rights of Holders of Senior Secured Notes to
Receive Payment. Notwithstanding any other provision of this Indenture, the
right of any Holder of a Senior Secured Note to receive payment of principal,
premium, Liquidated Damages if any, and interest on the Senior Secured Notes, on
or after the respective due dates expressed in the Senior Secured Notes
(including in connection with an offer to purchase), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
Section 5.08 Collection Suit by Trustee. If an Event of
Default specified in Section 5.01(a) occurs and is continuing, the Trustee is
authorized to recover judgment in its own name and as trustee of an express
trust against the Issuer for the whole amount of principal of, premium,
Liquidated Damages if any, and interest remaining unpaid on the Senior Secured
Notes and interest on overdue principal and, to the extent lawful, interest,
Liquidated Damages and such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
Section 5.09 Trustee May File Proofs of Claim. The Trustee is
authorized to file such proofs of claim and other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel) and the Holders of the Senior Secured Notes
allowed in any judicial proceedings relative to the Issuer (or any other obligor
upon the Senior Secured Notes), its creditors or its property and shall be
entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 6.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 6.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Senior Secured Notes or the rights of any Holder, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
Section 5.10 Priorities. If the Trustee collects any money
pursuant to this Article, it shall be applied to amounts owed with respect to
all Senior Secured Notes and will be applied ratably to the Holders of Senior
Secured Notes in the following order from time to time (to the extent such order
does not conflict with Section 5 of the Collateral Agency Agreement),
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on the date or dates fixed by the Trustee: (i) first, to the payment of all
amounts due to the Trustee or any predecessor Trustee under this Indenture; (ii)
second; (A) in case the unpaid principal amount of the Outstanding Senior
Secured Notes has not become due, to the payment of any overdue interest, (B) in
case the unpaid principal amount of a portion of the Outstanding Senior Secured
Notes has become due, first to the payment of accrued interest and Liquidated
Damages, if any, on all Outstanding Senior Secured Notes for overdue principal,
premium, Liquidated Damages if any, and overdue interest, and next to the
payment of the overdue principal on all Senior Secured Notes or (C) in case the
unpaid principal amount of all the Outstanding Senior Secured Notes has become
due, first to the payment of the whole amount then due and unpaid upon the
Outstanding Senior Secured Notes for principal, premium, Liquidated Damages if
any, and interest, together with interest for overdue principal, premium,
Liquidated Damages if any, and overdue interest; and (iii) third, in case the
unpaid principal amount of all the Outstanding Senior Secured Notes has become
due, and all of the outstanding principal, premium, Liquidated Damages if any,
interest and other amounts owed in connection with the Senior Secured Notes have
been fully paid, any surplus then remaining will be paid to the Issuer, or to
whomsoever may be lawfully entitled to receive the same, or as a court of
competent jurisdiction may direct.
The Trustee may fix a record date and payment date for any
payment to Holders of Senior Secured Notes pursuant to this Section 5.10.
Section 5.11 Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as a Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder of a Senior Secured Note pursuant to
Section 5.07 hereof, or a suit by Holders of more than 10% in principal amount
of the then outstanding Senior Secured Notes.
ARTICLE VI
TRUSTEE
Section 6.01 Duties of Trustee.
(a) If an Event of Default actually known to a Responsible
Trust Officer has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture, and use the same degree of
care and skill in its exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
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(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by
the express provisions of this Indenture and the Trustee need perform
only those duties that are specifically set forth in this Indenture and
no others, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements
of this Indenture.
(c) The Trustee may not be relieved from liabilities for its
own grossly negligent action, its own negligent failure to act, or its own
willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Trust Officer, unless it is proved
that the Trustee was grossly negligent in ascertaining the pertinent
facts; and
(iii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have offered
to the Trustee security and indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer. Money
held in trust by the Trustee need not be segregated from other funds except to
the extent required by law.
Section 6.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.
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(b) Before the Trustee acts or refrains from acting, it may
require and shall be entitled to an Officer's Certificate or an Opinion of
Counsel or both. The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on such Officers' Certificate or Opinion
of Counsel. The Trustee may consult with counsel and the advice, promptly
confirmed in writing thereafter, of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys, custodians,
nominees and agents and shall not be responsible for the misconduct or
negligence of any agent, attorney, custodian or nominee appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Issuer shall be sufficient if
signed by an Officer of the Issuer.
(f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee security or indemnity satisfactory to the Trustee against the costs,
expenses and liabilities that might be incurred by it in compliance with such
request or direction.
(g) In no event shall the Trustee be required to take notice
of any default or breach hereof or any Event of Default hereunder, except for
Events of Default specified in Section 5.01(a) hereof, unless and until the
Trustee shall have received from a Holder or from the Issuer express written
notice of the circumstances constituting the breach, default or Event of Default
and stating that said circumstances constitute an Event of Default hereunder.
(h) If the Trustee is acting as Paying Agent, Registrar,
Collateral Agent, Depositary Agent or Securities Intermediary hereunder, the
rights and protections afforded to the Trustee pursuant to this Article VI
(other than the Trustee's right to require, and entitlement to, an Opinion of
Counsel pursuant to Section 6.02(b) hereof) will also be afforded to such Paying
Agent, Registrar, Collateral Agent, Depositary Agent and Securities
Intermediary.
Section 6.03 Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Senior
Secured Notes and may otherwise deal with the Issuer or any Affiliate of the
Issuer with the same rights it would have if it were not Trustee. However, in
the event that the Trustee acquires any conflicting interest it must eliminate
such conflict within 90 days, apply to the SEC for permission to continue as
trustee or resign. Any Agent may do the same with like rights and duties. The
Trustee is also subject to Sections 6.10 and 6.11 hereof.
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Section 6.04 Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Senior Secured Notes, it shall not be accountable for the
Issuer's use of the proceeds from the Senior Secured Notes or any money paid to
the Issuer or upon the Issuer's direction under any provision of this Indenture,
it shall not be responsible for the use or application of any money received by
any Paying Agent other than the Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Security Documents, the
Senior Secured Notes or any other document in connection with the sale of the
Senior Secured Notes or pursuant to this Indenture other than its certificate of
authentication.
The Trustee makes no representations as to and shall not be
responsible for the existence, genuineness, value, sufficiency or condition of
any of the Collateral or as to the security afforded or intended to be afforded
thereby, hereby or by any Security Document, or for the validity, perfection,
priority or enforceability of the Liens or security interests in any of the
Collateral created or intended to be created by any of the Security Documents,
whether impaired by operation of law or by reason of any action or omission to
act on its part hereunder, except to the extent such action or omission
constitutes gross negligence or willful misconduct on the part of the Trustee,
for the validity of the title of the Issuer to the Collateral, for insuring the
Collateral or for the payment of taxes, charges, assessments or Liens upon the
Collateral or otherwise as to the maintenance of the Collateral.
References to the Trustee in this Section 6.04 shall include
the Trustee in its role as a Collateral Agent.
Section 6.05 Notice of Defaults. If a Default or Event of
Default occurs and is continuing and if it is actually known to a Responsible
Trust Officer, or if appropriate notice is provided in writing in accordance
with Section 6.02(g), as applicable, the Trustee shall mail to Holders of Senior
Secured Notes a notice of the Default or Event of Default within 30 days after
it occurs. Except in the case of a Default or Event of Default in payment of
principal of, premium, Liquidated Damages, if any, or interest on any Senior
Secured Note, the Trustee may withhold the notice if and so long as a committee
of its Responsible Trust Officers in good faith determines that withholding the
notice is in the interests of the Holders of the Senior Secured Notes.
Section 6.06 Reports by Trustee to Holders of the Senior
Secured Notes.
(a) Within 60 days after each May 15 beginning with the May 15
following the date hereof, and for so long as any Senior Secured Notes remain
outstanding, the Trustee shall mail to the Holders of the Senior Secured Notes a
brief report dated as of such reporting date that complies with TIA (section)
313(a) (but if no event described in TIA (section) 313(a) has occurred within
the twelve months preceding the reporting date, no report need be transmitted).
The Trustee also shall comply with TIA (section) 313(b)(2). The Trustee shall
also transmit by mail all reports as required by TIA (section) 313(c).
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(b) A copy of each report at the time of its mailing to the
Holders of Senior Secured Notes shall be mailed to the Issuer and filed with the
SEC and each stock exchange on which the Senior Secured Notes are listed in
accordance with TIA (section) 313(d). The Issuer shall promptly notify the
Trustee in writing when the Senior Secured Notes are listed on any stock
exchange.
Section 6.07 Compensation and Indemnity.
(a) The Issuer shall pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder as is now or hereafter agreed to in writing by the Issuer and the
Trustee. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuer shall reimburse the
Trustee promptly upon request for all reasonable and properly documented
disbursements, advances and expenses incurred or made by it in addition to the
compensation for its services. Such expenses shall include the reasonable and
properly documented fees, disbursements and expenses of the Trustee's agents and
counsel.
(b) The Issuer shall indemnify the Trustee against any and all
losses, liabilities, damages or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture and the other Financing Documents, including the costs and expenses of
enforcing this Indenture against the Issuer (including this Section 6.07) and
defending itself against any claim (whether asserted by the Issuer or any Holder
or any other person) or liability in connection with the exercise or performance
of any of its powers or duties hereunder or in connection with the storage, use,
presence, disposal or release of any Hazardous Substance on, under or about any
properties encumbered by the Deeds of Trust, except to the extent any such loss,
liability or expense may be attributable to its gross negligence or bad faith.
The Trustee shall notify the Issuer promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Issuer shall not relieve the
Issuer of its obligations hereunder. The Issuer shall defend the claim and the
Trustee shall cooperate in the defense. The Trustee may have separate counsel
(reasonably acceptable to the Issuer) and the Issuer shall pay the reasonable
fees and expenses of such counsel. The Issuer need not pay for any settlement
made without its consent, which consent shall not be unreasonably withheld.
(c) The obligations of the Issuer under this Section 6.07
shall survive the satisfaction and discharge of this Indenture.
(d) To secure the Issuer's payment obligations in this
Section, the Trustee shall have a Lien prior to the Senior Secured Notes on all
money or property held or collected by the Trustee, except that held in trust to
pay principal, interest, premium and Liquidated Damages, if any, on particular
Senior Secured Notes.
(e) When the Trustee incurs expenses or renders services after
an Event of Default specified in Section 5.01(e) hereof occurs, the expenses and
the compensation for the
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services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy Law.
(f) The Trustee shall comply with the provisions of TIA
(section) 313(b)(2) to the extent applicable.
(g) The provisions of this Section 6.07 shall extend to the
Trustee acting in the capacities of Paying Agent and Registrar, Collateral
Agent, Depositary Agent and Securities Intermediary under this Indenture and the
other Financing Documents.
Section 6.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of
a successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
(b) The Trustee may resign in writing at any time and be
discharged from the trust hereby created by giving thirty (30) days written
notice to the Issuer. The Required Holders may remove the Trustee by so
notifying the Trustee and the Issuer in writing. The Issuer may remove the
Trustee if:
(i) the Trustee fails to meet the eligibility criteria set
forth in this Indenture;
(ii) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
bankruptcy law;
(iii) no Default or Event of Default on our part has occurred
and is continuing and the Trustee has failed to observe or perform any
of its material obligations under the Financing Documents;
(iv) a custodian or public officer takes charge of the Trustee
or its property; or
(v) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Issuer shall promptly
appoint a successor Trustee. Within one year after the successor Trustee takes
office, the Holders of a majority in principal amount of the then outstanding
Senior Secured Notes may appoint a successor Trustee to replace the successor
Trustee appointed by the Issuer.
(d) The Issuer shall give notice of each resignation and
removal of the Trustee and each appointment of a successor to all Holders.
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(e) If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Issuer, or the Holders of Senior Secured Notes of at least 10% in principal
amount of the then outstanding Senior Secured Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(f) If the Trustee, after written request by any Holder of a
Senior Secured Note who has been a Holder of a Senior Secured Note for at least
six months, fails to comply with Section 6.10, such Holder of a Senior Secured
Note may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
(g) A successor Trustee shall deliver a written acceptance of
its appointment to the retiring Trustee and to the Issuer. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Senior Secured Notes. The retiring Trustee shall
promptly transfer all property held by it as Trustee to the successor Trustee,
provided all sums owing to the Trustee hereunder have been paid and subject to
the Lien provided for in Section 6.07 hereof. Notwithstanding replacement of the
Trustee pursuant to this Section 6.08, the Issuer's obligations under Section
6.07 hereof shall continue for the benefit of the retiring Trustee.
(h) If a Trustee is removed with or without cause, all fees
and expenses (including the reasonable fees and expenses of counsel) of the
Trustee incurred in the administration of the trust or in performing of the
duties hereunder shall be paid to the Trustee.
Section 6.09 Successor Trustee by Merger, etc. If the Trustee
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
Section 6.10 Eligibility; Disqualification. There will at all
times be a Trustee under this Indenture, which shall be a corporation having
either (a) a combined capital and surplus of at least $50.0 million, or (b) a
combined capital and surplus of at least $10.0 million and being a Wholly-Owned
Subsidiary of a corporation having a combined capital and surplus of at least
$50.0 million, in each case subject to supervision or examination by a federal
or state or District of Columbia authority and having a corporate trust office
in New York, New York, to the extent there is such an institution eligible and
willing to serve.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA (section) 310(a)(1), (2) and (5). The Trustee is subject to
TIA (section) 310(b).
Section 6.11 Preferential Collection of Claims Against the
Issuer. The Trustee is subject to TIA (section) 311(a), excluding any creditor
relationship listed in TIA (section) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (section) 311(a) to the extent indicated
therein.
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Section 6.12 Receipt of Documents. In no event shall receipt
by the Trustee of financial and other reports from the Issuer as provided in
this Indenture, review of which could lead to the conclusion that an Event of
Default exists hereunder, result, without further action, in the occurrence of
an Event of Default, or impose upon the Trustee the obligation to review and
examine the same, it being understood that all such information shall be
received by the Trustee as repository for said information and documents with no
obligation on the part of the Trustee to review the same.
ARTICLE VII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 7.01 Option to Effect Legal Defeasance or Covenant
Defeasance. The Issuer may, at its option evidenced by a resolution set forth in
an Officers' Certificate, at any time, elect to have either Section 7.02 or 7.03
hereof be applied to all outstanding Senior Secured Notes and all obligations of
the Guarantors with respect to their Guarantees upon compliance with the
conditions set forth below in this Article VII.
Section 7.02 Legal Defeasance and Discharge. Upon the Issuer's
exercise under Section 7.01 hereof of the option applicable to this Section
7.02, the Issuer shall, subject to the satisfaction of the conditions set forth
in Section 7.04 hereof, be deemed to have been discharged from its obligations
with respect to all outstanding Senior Secured Notes and the Guarantors shall be
deemed to be discharged from all of their obligations with respect to their
Guarantees and the Collateral Agent shall release all of its liens on the
Collateral other than pursuant to Section 7.04(a) hereof, on the date the
conditions set forth below are satisfied (hereinafter, "Legal Defeasance"). For
this purpose, Legal Defeasance means that the Issuer shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Senior Secured Notes and the Guarantees, which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 7.05 hereof and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Senior Secured Notes, the
Guarantees and this Indenture (and the Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments acknowledging the same), except
for the following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Senior Secured
Notes to receive payments in respect of the principal of, or interest or premium
and Liquidated Damages, if any, on such Senior Secured Notes when such payments
are due from the trust referred to below, (b) the Issuer's obligations with
respect to the Senior Secured Notes concerning issuing temporary Senior Secured
Notes, registration of Senior Secured Notes, replacing mutilated, destroyed,
lost or stolen Senior Secured Notes and the maintenance of an office or agency
for payment and money for security payments held in trust, (c) the rights,
powers, trusts, duties and immunities of the trustee, and our and the
Guarantors' obligations in connection therewith, and (d) this Article VII.
Subject to compliance with this Article VII, the Issuer may exercise its option
under this Section 7.02 notwithstanding the prior exercise of its option under
Section 7.03 hereof.
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Section 7.03 Covenant Defeasance. Upon the Issuer's exercise
under Section 7.01 hereof of the option applicable to this Section 7.03, the
Issuer shall and the Guarantors shall, subject to the satisfaction of the
conditions set forth in Section 7.04 hereof, be released from their obligations
under any of the covenants contained in this Indenture other than under Sections
4.01, 4.02, 4.03, 4.05 and clauses (i) and (ii) of Section 4.23 hereof with
respect to the outstanding Senior Secured Notes and may terminate the Liens of
the Security Documents on the Collateral to the extent that such Liens run to
the benefit of the Trustee, the Holders or other agents under any of the
Security Documents on and after the date the conditions set forth in Section
7.04 are satisfied (hereinafter, "Covenant Defeasance"), and the Senior Secured
Notes and all obligations of the Guarantors with respect to the Guarantees shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Senior Secured Notes and all obligations of the Guarantors with respect to the
Guarantees shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Senior
Secured Notes, the Issuer and the Guarantors may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth in
any such covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 5.01 hereof, but, except as specified above, the remainder of this
Indenture and such Senior Secured Notes shall be unaffected thereby. In
addition, upon the Issuer's exercise under Section 7.01 hereof of the option
applicable to this Section 7.03 hereof, subject to the satisfaction of the
conditions set forth in Section 7.04 hereof, Sections 5.01(b) through 5.01(d)
and Sections 5.01(g) through 5.01(l) hereof shall not constitute Events of
Default.
Section 7.04 Conditions to Legal or Covenant Defeasance. The
following shall be the conditions to the application of either Section 7.02 or
7.03 hereof to the outstanding Senior Secured Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance:
(a) the Issuer must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in such amounts as
shall be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium and Liquidated
Damages, if any, and interest on the outstanding Senior Secured Notes on the
stated date for payment thereof or on the applicable Redemption Date, as the
case may be, and the Issuer must specify whether the Senior Secured Notes are
being defeased to maturity or to a particular redemption date;
(b) in the case of an election under Section 7.02 hereof, the
Issuer shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that (A) the Issuer has
received from, or there has been published by, the
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Internal Revenue Service a ruling or (B) since the date hereof, there has been a
change in the applicable federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall confirm that, the Holders
of the outstanding Senior Secured Notes will not recognize income, gain or loss
for federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not
occurred;
(c) in the case of an election under Section 7.03 hereof, the
Issuer shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Senior Secured Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Covenant Defeasance had not
occurred;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the incurrence of Indebtedness all or a portion of the proceeds
of which will be used to defease the Senior Secured Notes pursuant to this
Article 7 concurrently with such incurrence);
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which the Issuer is a
party or by which the Issuer is bound;
(f) the Issuer shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Issuer with
the intent of preferring the Holders over any other creditors of the Issuer or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Issuer; and
(g) the Issuer shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
Section 7.05 Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous Provisions. Subject to Section 7.06 hereof,
all money and non-callable Government Securities (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee, collectively
for purposes of this Section 7.05, the "Trustee") pursuant to Section 7.04
hereof in respect of the outstanding Senior Secured Notes shall be held in trust
and applied by the Trustee, in accordance with the provisions of such Senior
Secured Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Issuer acting as Paying Agent) as the Trustee may
determine, to the Holders of such Senior Secured Notes of all sums due and to
become due thereon in respect of principal, premium, Liquidated Damages, if any,
and interest, but such money need not be segregated from other funds except to
the extent required by law.
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The Issuer shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 7.04 hereof or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Senior
Secured Notes.
Anything in this Article VII to the contrary notwithstanding,
the Trustee shall deliver or pay to the Issuer from time to time upon the
request of the Issuer any money or non-callable Government Securities held by it
as provided in Section 7.04 hereof which, in the opinion of a nationally
recognized investment bank or firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee (which may be the
opinion delivered under Section 7.04(a) hereof), are in excess of the amount
thereof that would then be required to be deposited to effect an equivalent
Legal Defeasance or Covenant Defeasance.
Section 7.06 Repayment to Issuer. Any money deposited with the
Trustee or any Paying Agent, or then held by the Issuer, in trust for the
payment of the principal of, premium, Liquidated Damages, if any, or interest on
any Senior Secured Note and remaining unclaimed for two years after such
principal, and premium, Liquidated Damages, if any, or interest has become due
and payable shall be paid to the Issuer on its request or (if then held by the
Issuer) shall be discharged from such trust; and the Holder of such Senior
Secured Note shall thereafter, as a secured creditor, look only to the Issuer
for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Issuer as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Issuer cause to be published once, in the New York Times and The Wall Street
Journal (national edition), notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such notification or publication, any unclaimed balance of such money
then remaining shall be repaid to the Issuer.
Section 7.07 Reinstatement. If the Trustee or Paying Agent is
unable to apply any United States dollars or non-callable Government Securities
in accordance with Section 7.02 or 7.03 hereof, as the case may be, by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the Issuer's
obligations under this Indenture and the Senior Secured Notes shall be revived
and reinstated as though no deposit had occurred pursuant to Section 7.02 or
7.03 hereof until such time as the Trustee or Paying Agent is permitted to apply
all such money in accordance with Section 7.02 or 7.03 hereof, as the case may
be; provided, however, that, if the Issuer makes any payment of principal of,
premium, Liquidated Damages, if any, or interest on any Senior Secured Note
following the reinstatement of its obligations, the Issuer shall be subrogated
to the rights of the Holders of such Senior Secured Notes to receive such
payment from the money held by the Trustee or Paying Agent.
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ARTICLE VIII
AMENDMENT, SUPPLEMENT AND WAIVER
Section 8.01 Without Consent of Holders of Senior Secured
Notes. Notwithstanding Section 8.02 of this Indenture, the Issuer and the
Trustee may amend or supplement this Indenture and any of the other Financing
Documents without the consent of any Holder of a Senior Secured Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to add additional covenants of the Issuer or its
Subsidiaries, to surrender rights conferred upon the Issuer or its Subsidiaries,
or to confer additional benefits upon the Holders;
(c) to increase the assets securing the Issuer's obligations
under this Indenture;
(d) to allow any Subsidiary to execute a Supplemental
Indenture and/or Guarantee with respect to the Senior Secured Notes;
(e) to comply with requirements of the SEC in order to effect
or maintain the qualification of this Indenture under the Trust Indenture Act;
(f) to make any change not inconsistent with the terms of this
Indenture that does not adversely affect the legal rights thereunder of any
Holder of the Senior Secured Notes; or
(g) to establish the form and terms of Senior Secured Notes of
any series permitted by Sections 2.01 and 2.03.
Upon the request of the Issuer accompanied by a resolution of
the Issuer's Board of Directors authorizing the execution of any such amended or
supplemental Indenture or amendments to the other Financing Documents, and upon
receipt by the Trustee of the documents described in Section 6.02 hereof, the
Trustee and the Collateral Agent shall join with the Issuer in the execution of
any amended or supplemental Indenture and any amendment to any of the other
Financing Documents authorized or permitted by the terms of this Indenture and
to make any further appropriate agreements and stipulations that may be therein
contained, but the Trustee and the Collateral Agent shall not be obligated to
enter into such amended or supplemental Indenture or amendments to the Financing
Documents that affects its own rights, duties, immunities, or indemnities under
this Indenture or otherwise.
Section 8.02 With Consent of Holders of Senior Secured Notes.
Except as provided below in this Section 8.02, the Issuer and the Trustee may
amend or supplement this Indenture (including Section 4.23 hereof) and the other
Financing Documents with the consent of the Required Holders voting as a single
class (including consents obtained in connection with a
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tender offer or exchange offer for, or purchase of, the Senior Secured Notes),
and, subject to Sections 5.04 and 5.07 hereof, any existing Default or Event of
Default (other than a Default or Event of Default in the payment of the
principal of, premium, Liquidated Damages, if any, or interest on the Senior
Secured Notes, except a payment default resulting from an acceleration that has
been rescinded) or compliance with any provision of this Indenture or the other
Financing Documents may be waived with the consent of the Required Holders
voting as a single class (including consents obtained in connection with a
tender offer or exchange offer for, or purchase of, the Senior Secured Notes);
provided, however, that if there shall be Senior Secured Notes of more than one
series Outstanding hereunder and if a proposed supplemental indenture shall
directly affect the rights of the Holders of one or more, but less than all, of
such series, then the consent only of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Senior Secured Notes of all series
so directly affected, considered as one class, shall be required. Section 2.08
hereof shall determine which Senior Secured Notes are considered to be
"outstanding" for purposes of this Section 8.02.
Upon the request of the Issuer accompanied by a resolution of
the Issuer's Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Senior Secured
Notes as aforesaid, and upon receipt by the Trustee of the documents described
in Section 6.02 hereof, the Trustee shall join with the Issuer in the execution
of such amended or supplemental Indenture and amendments to the other Financing
Documents unless such amended or supplemental Indenture or amendments to the
Financing Documents directly affects the Trustee's own rights, duties,
immunities or indemnities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter into such
amended or supplemental Indenture or such amendments.
It shall not be necessary for the consent of the Holders of
Senior Secured Notes under this Section 8.02 to approve the particular form of
any proposed amendment or waiver, but it shall be sufficient if such consent
approves the substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Issuer shall mail to the Holders of Senior Secured Notes
affected thereby a notice briefly describing the amendment, supplement or
waiver. Any failure of the Issuer to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such amended
or supplemental Indenture or waiver or amendments to the Financing Documents.
Subject to Sections 5.04 and 5.07 hereof, the Required Holders may waive
compliance in a particular instance by the Issuer with any provision of this
Indenture or the Senior Secured Notes. However, without the consent of all
Holders of Outstanding Senior Secured Notes directly affected thereby, an
amendment or waiver under this Section 8.02 may not (with respect to any such
Senior Secured Notes held by a non-consenting Holder):
(a) modify the principal, interest, premium or Liquidated
Damages, if any, payable upon the Senior Secured Notes;
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(b) modify the dates on which principal, interest, premium and
Liquidated Damages, if any, on any Senior Secured Notes are paid;
(c) release any Guarantor from its obligations under a
Guarantee;
(d) modify the dates of maturity of any Senior Secured Notes;
and
(e) make any change in the preceding procedures for amendment,
supplement or waiver.
This Indenture and the other Security Documents may be amended
or supplemented to provide for the release of Collateral, by the Issuer and the
Trustee, with the consent of Holders of not less than 66% of the Outstanding
Senior Secured Notes.
A supplemental indenture that changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Senior Secured Notes,
or which modifies the rights of the Holders of Senior Secured Notes of such
series with respect to such covenant or other provision, shall be deemed not to
affect the rights under this Indenture of the Holders of Senior Secured Notes of
any other series.
Upon the request of the Issuer accompanied by a resolution of
the issuer's Board of Directors authorizing the execution of any such amended or
supplemental Indenture or amendments to the other Financing Documents, and upon
receipt by the Trustee of the documents described in Section 6.02 hereof, the
Trustee and the Collateral Agent shall join with the Issuer in the execution of
any amended or supplemental Indenture and any amendment to any of the other
Financing Documents authorized or permitted by the terms of this Indenture and
to make any further appropriate agreements and stipulations that may be therein
contained, but the Trustee and the Collateral Agent shall not be obligated to
enter into such amended or supplemental Indenture or amendments to the Financing
Documents that affects its own rights, duties, immunities, or indemnities under
this Indenture or otherwise.
It shall not be necessary for any act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such act shall approve the substance thereof.
Section 8.03 Revocation and Effect of Consents. Until an
amendment, supplement or waiver becomes effective, a consent to it by a Holder
of a Senior Secured Note is a continuing consent by the Holder of a Senior
Secured Note and every subsequent Holder of a Senior Secured Note or portion of
a Senior Secured Note that evidences the same debt as the consenting Holder's
Senior Secured Note, even if notation of the consent is not made on any Senior
Secured Note. However, any such Holder of a Senior Secured Note or subsequent
Holder of a Senior Secured Note may revoke the consent as to its Senior Secured
Note if the Trustee receives written notice of revocation before the date the
waiver, supplement or amendment
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becomes effective. An amendment, supplement or waiver becomes effective in
accordance with its terms and thereafter binds every Holder.
Section 8.04 Notation on or Exchange of Senior Secured Notes.
The Trustee may place an appropriate notation about an amendment, supplement or
waiver on any Senior Secured Note thereafter authenticated. The Issuer in
exchange for all Senior Secured Notes may issue and the Trustee shall, upon
receipt of an Authentication Order, authenticate new Senior Secured Notes that
reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Senior
Secured Note shall not affect the validity and effect of such amendment,
supplement or waiver.
Section 8.05 Trustee to Sign Amendments, etc. The Trustee and
the Collateral Agent shall sign any amended or Supplemental Indenture and
amendments to the other Financing Documents authorized pursuant to this Article
VIII if the amendment or supplement does not adversely affect the rights,
duties, liabilities, immunities or indemnities of the Trustee or the Collateral
Agent. The Issuer may not sign an amendment or Supplemental Indenture until its
shareholders approve it. In executing any amended or Supplemental Indenture or
amendments to the other Financing Documents, the Trustee and the Collateral
Agent shall be entitled to receive and (subject to Section 6.01 hereof) shall be
fully protected in relying upon, in addition to the documents required by
Section 10.04 hereof, an Officer's Certificate and an Opinion of Counsel stating
that the execution of such amended or supplemental indenture or amendment to the
other Financing Documents is authorized or permitted by this Indenture.
Section 8.06 Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by any Series Supplemental
Indenture or other supplemental indenture permitted by this Article VIII or the
modifications thereby of the trusts created by this Indenture, the Trustee shall
be entitled to receive, and (subject to Sections 6.01 and 6.02) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture.
Section 8.07 Effect of Supplemental Indentures. Upon the
execution of any Supplemental Indenture under this Article VIII, this Indenture
shall be modified in accordance therewith, and such Supplemental Indenture shall
form a part of this Indenture for all purposes; and every Holder of Senior
Secured Notes theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 8.08 Conformity with Trust Indenture Act. Every
Supplemental Indenture executed pursuant to this Article VIII shall conform to
the requirements of the Trust Indenture Act as then in effect.
Section 8.09 Reference in Senior Secured Notes to Supplemental
Indentures. Senior Secured Notes authenticated and delivered after the execution
of any Supplemental Indenture pursuant to this Article VIII may, and shall if
required by the Issuer, bear a notation in
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form approved by the Issuer as to any matter provided for in such Supplemental
Indenture; and, in such case, suitable notation may be made upon Outstanding
Senior Secured Notes after proper presentation and demand. If the Issuer shall
so determine, new Senior Secured Notes so modified as to conform, in the opinion
of the Issuer and the Trustee, to any such Supplemental Indenture may be
prepared and executed by the Issuer and authenticated and delivered by the
Trustee in exchange for Outstanding Senior Secured Notes.
ARTICLE IX
GUARANTEE
Section 9.01 Agreement to Guarantee.
(a) Each of the Guarantors, hereby jointly and severally with
all other Guarantors, unconditionally guarantees to each Holder of a Senior
Secured Note authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, regardless of the validity and enforceability of
this Indenture, the Senior Secured Notes or the other Senior Secured Obligations
of the Issuer under this Indenture or the Senior Secured Notes, that:
(i) the principal of, premium, interest and Liquidated
Damages, if any, on the Senior Secured Notes will be promptly paid in
full when due, whether at maturity, by acceleration, redemption or
otherwise, and interest on the overdue principal of, premium and
Liquidated Damages, if any, and interest on the Senior Secured Notes,
to the extent lawful, and all other Senior Secured Obligations of the
Issuer to the Holders or the Trustee under this Indenture or the Senior
Secured Notes will be promptly paid in full, all in accordance with the
terms hereof or thereof; and
(ii) in case of any extension of time for payment or renewal
of any Senior Secured Note or any of such other Senior Secured
Obligations, that the same will be promptly paid in full when due in
accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise.
(b) Notwithstanding the foregoing, in the event that this
Guarantee would constitute or result in a violation of any applicable fraudulent
conveyance or similar law of any relevant jurisdiction, the liability of the
Guarantors under this Indenture will be reduced to the maximum amount
permissible under such fraudulent conveyance or similar law.
(c) Failing payment when due of any amount so guaranteed or
any performance so guaranteed for whatever reason, the Guarantors will be
jointly and severally obligated to pay, perform or cause the performance of the
same immediately. Each Guarantor agrees that this is a guarantee of payment and
not a guarantee of collection.
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Section 9.02 Execution and Delivery of Guarantee.
(a) To evidence its Guarantee set forth in this Indenture,
each Guarantor hereby agrees that a notation of such Guarantee substantially in
the form attached as Exhibit F to this Indenture will be endorsed by an
Authorized Officer of such Guarantor on each Senior Secured Note authenticated
and delivered by the Trustee on or after the date hereof.
(b) Notwithstanding the foregoing, each Guarantor hereby
agrees that its Guarantee set forth herein will remain in full force and effect
notwithstanding any failure to endorse on each Senior Secured Note a notation of
such Guarantee.
(c) If an Authorized Officer whose signature is on this
Indenture or on a Guarantee no longer holds that office at the time the Trustee
authenticates the Senior Secured Note on which a Guarantee is endorsed, the
Guarantee will be valid nevertheless.
(d) The delivery of any Senior Secured Note by the Trustee,
after the authentication thereof under this Indenture, will constitute due
delivery of the Guarantee set forth in this Indenture on behalf of each
Guarantor.
(e) Each Guarantor hereby agrees that its Senior Secured
Obligations hereunder will be unconditional, regardless of the validity,
regularity or enforceability of the Senior Secured Note or this Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
of the Senior Secured Notes with respect to any provisions hereof or thereof,
the recovery of any judgment against the Issuer, any action to enforce the same
or any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a guarantor.
(f) Each Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Issuer, any right to require a proceeding first against the
Issuer, protest, notice and all demands whatsoever and covenants that its
Guarantee made pursuant to this Indenture will not be discharged except by
complete performance of the Senior Secured Obligations contained in the Senior
Secured Notes and this Indenture.
(g) If any Holder or the Trustee is required by any court or
otherwise to return to the Issuer or any Guarantor, or any custodian, Trustee,
liquidator or other similar official acting in relation to either the Issuer or
such Guarantor, any amount paid by either to the Trustee or such Holder, the
Guarantee made pursuant to this Indenture, to the extent theretofore discharged,
will be reinstated in full force and effect.
(h) Each Guarantor agrees that it will not be entitled to any
right of subrogation in relation to the Holders in respect of any Senior Secured
Notes guaranteed hereby until payment in full of all Senior Secured Notes
guaranteed hereby. Each Guarantor further agrees that, as between such
Guarantor, on the one hand, and the Holders and the Trustee, on the other hand:
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(i) the maturity of the Senior Secured Notes guaranteed hereby
may be accelerated as provided in Article V hereof for the purposes of
the Guarantee made pursuant to this Indenture, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in
respect of the Senior Secured Notes guaranteed hereby; and
(ii) in the event of any declaration of acceleration of such
Senior Secured Notes as provided in Article V hereof, such Senior
Secured Notes (whether or not due and payable) will forthwith become
due and payable by such Guarantor for the purpose of the Guarantee made
pursuant to this Indenture.
(i) Each Guarantor will have the right to seek contribution
from any other non-paying Guarantor so long as the exercise of such right does
not impair the rights of the Holders or the Trustee under the Guarantee made
pursuant to this Indenture.
Section 9.03 Guarantors May Consolidate, etc. on Certain
Terms.
(a) Except as set forth in Article IV, and notwithstanding
Section 9.03(b) hereof, nothing contained in this Indenture or in the Senior
Secured Notes will prevent any consolidation or merger of any Guarantor with or
into the Issuer or any other Guarantor or will prevent any transfer, sale or
conveyance of the property of any Guarantor as an entirety or substantially as
an entirety to the Issuer or any other Guarantor.
(b) No Guarantor may sell or otherwise dispose of all or
substantially all of its assets to, or consolidate with or merge with or into
(whether or not such Guarantor is the surviving Person), another Person, other
than the Issuer or another Guarantor.
Section 9.04 Covenants of the Guarantors and Ormesa. Each
Guarantor and Ormesa (to the extent compliance therewith would not violate the
Ormesa Credit Agreement) agrees that to the extent the Issuer has agreed to
cause a Subsidiary to take certain actions, or to prohibit, prevent, or
otherwise limit the ability of a Subsidiary to take certain actions, that such
agreement shall constitute a direct obligation of each Guarantor and Ormesa (to
the extent compliance therewith would not violate the Ormesa Credit Agreement).
Nothing in this Section 9.04 shall be construed to permit any Guarantor to incur
Indebtedness permitted to be incurred by the Issuer pursuant to Section 4.18
hereof.
ARTICLE X
MISCELLANEOUS
Section 10.01 Trust Indenture Act Controls. If any provision
of this Indenture limits, qualifies or conflicts with the duties imposed by TIA
(section) 318(c), the imposed duties shall control.
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Section 10.02 Notices. Any notice or communication by the
Issuer or the Trustee to the others is duly given if in writing and delivered in
Person or mailed by first class mail (registered or certified, return receipt
requested), telex, telecopier or overnight air courier guaranteeing next day
delivery, to the others' address:
If to the Issuer or the Guarantors:
Ormat Funding Corp.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attention: President
with a copy to:
Xxxxxx & Xxxxxxx LLP
000 "X" Xxxxxx
Xxxxx 0000
Xxx Xxxxx, XX 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxxx Xxxxxx, Esq.
If to the Trustee:
Union Bank of California, N.A.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attention: Corporate Trust Department
The Issuer or the Trustee, by notice to the other, may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
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Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA (section) 313(c), to the extent required
by the TIA. Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Issuer mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
Section 10.03 Communication by Holders of Senior Secured Notes
with Other Holders of Senior Secured Notes. Holders may communicate pursuant to
TIA (section) 312(b) with other Holders with respect to their rights under this
Indenture or the Senior Secured Notes. The Issuer, the Trustee, the Registrar
and anyone else shall have the protection of TIA (section) 312(c).
Section 10.04 Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Issuer to the Trustee to take
any action under this Indenture, the Issuer shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 10.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA (section) 314(a)(4)) shall comply with the provisions of TIA
(section) 314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition has
been satisfied; and
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(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
Section 10.06 Rules by Trustee and Agents. The Trustee may
make reasonable rules for action by or at a meeting of Holders. The Registrar or
Paying Agent may make reasonable rules and set reasonable requirements for its
functions.
Section 10.07 No Personal Liability of Directors, Officers,
Employees and Stockholders. No past, present or future director, officer,
employee, organizer, manager or agent of the Issuer or any Affiliate of any such
party (other than the Issuer), as such, shall have any liability for any
obligations of the Issuer under the Senior Secured Notes, this Indenture, any
Financing Document or for any claim based on, in respect of, or by reason of,
such obligations or their creation. Each Holder by accepting a Senior Secured
Note waives and releases all such liability. The waiver and release are part of
the consideration for issuance of the Senior Secured Notes.
Section 10.08 Governing Law. THE INTERNAL LAW OF THE STATE OF
NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE SENIOR SECURED
NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
Section 10.09 Submission to Jurisdiction. The Issuer and the
Guarantors hereby submit to the nonexclusive jurisdiction of the New York State
Courts and the federal courts sitting in the State of New York for the purposes
of all legal proceedings arising out of or relating to this Indenture or the
transactions contemplated hereby. The Issuer and Guarantors hereby irrevocably
waive, to the fullest extent permitted by applicable law, any objection which
they may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such
court has been brought in an inconvenient forum.
Section 10.10 Waiver of Jury Trial. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS INDENTURE OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER THIS INDENTURE BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
-99-
Page 100
Section 10.11 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
Indebtedness agreement of the Issuer or its Subsidiaries or of any other Person.
Any such indenture, loan or Indebtedness agreement may not be used to interpret
this Indenture.
Section 10.12 Successors. All agreements of the Issuer in this
Indenture and the Senior Secured Notes shall bind its successors. All agreements
of the Trustee in this Indenture shall bind its successors.
Section 10.13 Severability. In case any provision in this
Indenture or in the Senior Secured Notes shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 10.14 Counterpart Originals. The parties may sign any
number of copies of this Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement.
Section 10.15 Table of Contents, Headings, etc. The Table of
Contents, and headings of the Articles and Sections of this Indenture have been
inserted for convenience of reference only, are not to be considered a part of
this Indenture and shall in no way modify or restrict any of the terms or
provisions hereof.
[Signatures on following page]
-100-
Page 101
SIGNATURES:
ORMAT FUNDING CORP.
By: /s/ Xxxxxx Xxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
-101-
Page 000
XXXXX XXXX XX XXXXXXXXXX, N.A.
as Trustee
By: /s/ Xxxxx X. Xxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
-102-
Page 103
ORMESA LLC,
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
GUARANTORS:
XXXXX POWER PARTNERS
as a Guarantor
By: ORNI 1 LLC,
a Delaware limited liability company
Its: General Partner
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
STEAMBOAT GEOTHERMAL LLC,
as a Guarantor
By: ORNI 7 LLC,
a Delaware limited liability company
Its: General Partner
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
-103-
Page 104
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
STEAMBOAT DEVELOPMENT CORPORATION
as a Guarantor
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
ORMAMMOTH INC.
as a Guarantor
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
ORNI 1 LLC
as a Guarantor
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
ORNI 2 LLC
as a Guarantor
By: ORMAT FUNDING CORP.,
a Delaware corporation
-104-
Page 105
Its: Sole Member and Manager
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
ORNI 7 LLC
as a Guarantor
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Secretary
-105-
EXHIBIT A-l
(Face of Senior Secured Note)
[GLOBAL NOTE LEGEND)
[INCLUDE IF SENIOR SECURED NOTE IS A GLOBAL NOTE - UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO ORMAT FUNDING CORP. (THE "ISSUER")
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS SENIOR SECURED NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO. THIS GLOBAL NOTE MAY NOT BE EXCHANGED, IN
WHOLE OR IN PART, FOR A SENIOR SECURED NOTE REGISTERED IN THE NAME OF ANY PERSON
OTHER THAN THE DEPOSITORY TRUST COMPANY OR A NOMINEE THEREOF EXCEPT IN THE
CIRCUMSTANCES SET FORTH IN SECTION 2.07 OF THE INDENTURE, AND MAY NOT BE
TRANSFERRED, IN WHOLE OR IN PART, EXCEPT IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN SECTION 2.07 OF THE INDENTURE. BENEFICIAL INTERESTS IN THIS GLOBAL NOTE
MAY NOT BE TRANSFERRED EXCEPT IN ACCORDANCE WITH SECTION 2.07 OF THE INDENTURE.]
[RESTRICTED NOTES LEGEND]
[INCLUDE IF NOTE IS A RESTRICTED NOTE OR A TEMPORARY REGULATION S
GLOBAL NOTE (UNLESS, PURSUANT TO SECTION 2.07, THE ISSUER DETERMINES THAT THE
LEGEND MAY BE REMOVED) - THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)
(1) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(l), (2),
(3) OR (7) UNDER THE
Exhibit X-x
Xxxx 2
SECURITIES ACT, IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, (5) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION OF
COUNSEL IF ORMAT FUNDING CORP. SO REQUESTS) OR (6) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL
APPLICABLE BLUE SKY LAWS OF THE STATES OF THE UNITES STATES.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE TRUSTEE
SUCH CERTIFICATES AND OTHER INFORMATION AS THE ISSUER MAY REASONABLY REQUIRE TO
CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.]
Exhibit X-x
Xxxx 3
================================================================================
CUSIP/CINS: 686685 AA 6
8 1/4% Senior Secured Notes due 2020
No. $
-- ---------
ORMAT FUNDING CORP.
promises to pay to Cede & Co., or registered assigns, the principal sum
of______________ Dollars in installments on the dates and in the amounts as set
forth in Schedule I attached hereto and made part hereof.
Interest Payment Dates: June 30 and December 30
Record Dates: June 15 and December 15
DATED:
ORMAT FUNDING CORP.
By:
-------------------------------------
Name:
Title:
This is one of the [Global Notes] [Certificated Notes] referred to in the
within-mentioned Indenture:
Union Bank of California, N.A.,
as Trustee
By:
---------------------------------
Name:
================================================================================
Exhibit X-x
Xxxx 4
(Back of Note)
8 1/4% Senior Secured Notes due 2020
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. Interest. Ormat Funding Corp., a Delaware corporation (the
"Issuer"), promises to pay interest on the outstanding principal amount of this
Senior Secured Note at 8 1/4% per annum from the date of issuance until the
Final Maturity Date and will pay the Liquidated Damages payable pursuant to
Section 5 of the Registration Rights Agreement referred to below. The Issuer
shall pay interest and Liquidated Damages, if any, pro rata semi-annually in
arrears on June 30 and December 30 of each year (the "Interest Payment Date"),
or if any such day is not a Business Day, on the next succeeding Business Day.
Interest on the Senior Secured Notes will accrue from the most recent Interest
Payment Date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Senior Secured Note is authenticated between a
record date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest Payment
Date; provided, further, that the first Interest Payment Date shall be June 30,
2004. The Issuer shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the rate
then in effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to
time on demand at the same rate to the extent lawful. Interest will be computed
on the basis of a 360-day year comprised of twelve 30-day months.
2. Method of Payment. The Issuer will pay interest and payments of
principal in accordance with Schedule I attached hereto on the Senior Secured
Notes (except defaulted interest) and Liquidated Damages, if any, to the Persons
who are registered Holders of Senior Secured Notes at the close of business on
the June 15 or December 15 next preceding the Interest Payment Date, even if
such Senior Secured Notes are cancelled after such record date and on or before
such Interest Payment Date, except as provided in Section 2.12 of the Indenture
with respect to defaulted interest. The Senior Secured Notes will be payable as
to principal, premium and Liquidated Damages, if any, and interest at the office
or agency of the Issuer maintained for such purpose within or without the City
and State of New York, or, at the option of the Issuer, payment of interest may
be made by check mailed to the Holders at their addresses set forth in the
register of Holders, and provided that payment by wire transfer of immediately
available funds will be required with respect to principal of, interest, premium
and Liquidated Damages on all Global Notes and all other Senior Secured Notes
the Holders of which shall have provided wire transfer instructions to the
Issuer or the Paying Agent. Such payment shall be in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.
Exhibit X-x
Xxxx 5
3. Paying Agent and Registrar. Initially, Union Bank of California,
N.A., the Trustee under the Indenture, will act as Paying Agent and Registrar.
The Issuer may change any Paying Agent or Registrar without notice to any
Holder. The Issuer or any of its Subsidiaries may act in any such capacity.
4. Indenture. The Issuer issued the Senior Secured Notes under an
Indenture dated as of February 13, 2004 among the Issuer, Xxxxx Power Partners,
Steamboat Development Corp., Steamboat Geothermal LLC, OrMammoth Inc., ORNI 1
LLC, ORNI 2 LLC, ORNI 7 LLC, Ormesa LLC and Union Bank of California, N.A., as
Trustee. The terms of the Senior Secured Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Senior Secured Notes are subject to all such terms, and Holders are referred to
the Indenture and such Act for a statement of such terms. To the extent any
provision of this Senior Secured Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be controlling.
5. Optional Redemption. (a) The Senior Secured Notes shall be
redeemable at the option of the Issuer at any time and from time to time, in
whole or in part, upon not less than 30 nor more than 60 days' notice to the
Trustee and each Holder of Senior Secured Notes, at a redemption price equal to
the outstanding principal amount thereof plus accrued interest and Liquidated
Damages, if any, plus the Make-Whole Premium, such redemption price to be set
forth in the notice to the Trustee. In no event shall the sum of the redemption
price plus the Make-Whole Premium ever be less than 100% of the Senior Secured
Notes being redeemed plus accrued and unpaid interest thereon to the Redemption
Date. Unless the Issuer defaults in payment of the redemption price, on and
after the Redemption Date interest and Liquidated Damages, if any, shall cease
to accrue on the Senior Secured Notes or portions thereof called for redemption.
(b) Any redemption pursuant to this subparagraph 5 shall be made
pursuant to the provisions of Section 3.01 through 3.06 of the Indenture.
6. Mandatory Redemption. (a) The Senior Secured Notes shall be subject
to mandatory redemption, in whole or in part, at a redemption price equal to the
principal amount of the Senior Secured Notes being redeemed plus accrued and
unpaid interest and Liquidated Damages, if any, to the Redemption Date, if the
Issuer or any Subsidiary receives more than $5.0 million of Loss Proceeds or
Eminent Domain Proceeds because of an Event of Loss or an Event of Eminent
Domain and:
(i) the Issuer determines that all or such portion of the applicable
Plant cannot be rebuilt, repaired or restored to permit
operations on a commercially reasonable basis, or the Issuer
determines not to rebuild, repair or restore the applicable Plant
or such portion, in which case the Issuer shall have to use the
Net Available Amount of such proceeds for such redemption; or
Exhibit A-1
Page 6
(ii) only a portion of the applicable Plant is capable of being
rebuilt, repaired or restored on a commercially reasonable basis
and the Issuer determines to so rebuild, repair or restore, in
which case the Issuer will have to use only the amount of such
Loss Proceeds or Eminent Domain Proceeds not used to rebuild,
repair or restore such Plant for such redemption, except as set
forth in the immediately following paragraph.
If the Issuer or any Subsidiary receives less than $5 million of Loss
Proceeds or Eminent Domain Proceeds or has less than $5 million remaining after
rebuilding, repairing or restoring a portion of the applicable Plant because of
an Event of Loss or Event of Eminent Domain the Issuer will cause such amounts
to be deposited into the Revenue Account.
(b) If the Issuer or any Subsidiary (a) receives more than $5.0
million of Title Event Proceeds in connection with a Title Event and is unable
to remedy the Title Event, or (b) has more than $5.0 million of Title Event
Proceeds remaining after remedying the Title Event, the Issuer will have to use
the Net Available Amount of such proceeds, to the extent not used to cure the
Title Event, on a pro rata basis to redeem the Senior Secured Notes at a
redemption price equal to the principal amount of the Senior Secured Notes being
redeemed plus accrued and unpaid interest and Liquidated Damages, if any, to the
Redemption Date. If the Issuer or any Subsidiary receives less than $5 million
of Title Event Proceeds in connection with a Title Event or has less than $5
million remaining after remedying a Title Event the Issuer will cause such
amounts to be deposited into the Revenue Account.
(c) If on or prior to September 30, 2005, the Issuer has not satisfied
the Initial Galena Re-powering Account Withdrawal Conditions, then the Issuer
will have to use the proceeds of the Galena Re-powering Account to redeem Senior
Secured Notes at a price equal to 101% of the principal amount of Senior Secured
Notes being redeemed plus accrued and unpaid interest and Liquidated Damages, if
any, to the Redemption Date.
(d) If Final Completion is not achieved by March 31, 2006 or the
Galena Re-powering does not result in a minimum net electrical output of 18 MW
as determined in accordance with performance tests conducted pursuant to the
Galena Re-powering Contract (as certified by the Independent Engineer), then
from and after March 31, 2006, the Issuer will not be able to make any
Restricted Payments until the Issuer has used any amounts the Issuer receives as
Performance Liquidated Damages and amounts in the Distribution Suspense Account
to redeem or has otherwise redeemed (a "Galena Re-powering Performance
Redemption") Senior Secured Notes in an amount equal to the product of (x)
$1,100,000 times (y) the difference between (i) 18 MW minus (ii) the actual
number of Megawatts of the Galena Re-powering as demonstrated by the Performance
Guarantee Tests and certified by the Independent Engineer. The Issuer will
redeem the Senior Secured Notes in connection with a Galena Re-powering
Performance Redemption at a price equal to 101% of the principal amount of the
Senior Secured Notes required to be redeemed plus accrued and unpaid interest
and Liquidated Damages, if any, to the Redemption Date.
Exhibit A-1
Page 7
(e) If, as of January 1, 2006, the Mammoth Enhancement has not
improved the net electrical output of the Mammoth Plant by at least 3.6 MW (as
certified by the Independent Engineer), then from and after January 1, 2006, the
Issuer will not be able to make any Restricted Payments until the Issuer has
used amounts in the Distribution Suspense Account to redeem or has otherwise
redeemed (a "Mammoth Enhancement Redemption") Senior Secured Notes in an amount
equal to the product of (x) $1,100,000 times (y) the difference between (i) 3.6
MW minus (ii) the actual number of Megawatts that the Mammoth Enhancement
increases the net electrical output of the Mammoth Plant. The Issuer shall
redeem the Senior Secured Notes in connection with a Mammoth Enhancement
Redemption at a price equal to 101% of the principal amount of the Senior
Secured Notes required to be redeemed plus accrued and unpaid interest and
Liquidated Damages, if any, to the Redemption Date.
In the event that any Senior Secured Obligations (other than the
Senior Secured Notes) are required to be redeemed before their scheduled
maturity pursuant to documents governing such Senior Secured Obligations for any
reason not otherwise giving rise to a redemption of the Senior Secured Notes,
the Issuer shall offer to repurchase the Senior Secured Notes on a pro rata
basis with the other Senior Secured Obligations as are required to be redeemed
at a redemption price equal to the principal amount of the Senior Secured Notes
the Issuer offers to repurchase plus accrued and unpaid interest and Liquidated
Damages, if any, to the Redemption Date, but without any premium.
Other than as specifically provided in this subparagraph 6, any
purchase or redemption pursuant to this subparagraph 6 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 of the Indenture.
7. Notice of Redemption. At least 30 days but not more than 60 days
before a Redemption Date, the Issuer shall mail or cause to be mailed, by first
class mail, a notice of redemption to each Holder whose Senior Secured Notes are
to be redeemed at its registered address.
The notice shall identify the Senior Secured Notes to be redeemed and
shall state:
(a) the Redemption Date;
(b) the redemption price;
(c) if any Senior Secured Note is being redeemed in part, the portion
of the principal amount of such Senior Secured Note to be redeemed and
that, after the redemption date upon surrender of such Senior Secured Note,
a new Senior Secured Note or Senior Secured Notes in principal amount equal
to the unredeemed portion shall be issued upon cancellation of the original
Senior Secured Note;
(d) the name, address and telephone number of the Paying Agent;
Exhibit X-x
Xxxx 8
(e) that Senior Secured Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(f) that, unless the Issuer defaults in making such redemption
payment, interest and Liquidated Damages, if any, on Senior Secured Notes
called for redemption ceases to accrue on and after the Redemption Date;
(g) the paragraph of the Senior Secured Notes and/or Section of the
Indenture pursuant to which the Senior Secured Notes called for redemption
are being redeemed; and
(h) the CUSIP number (provided that the Issuer may state that no
representation is made as to the correctness or accuracy of the CUSIP
number, if any, listed in such notice or printed on the Senior Secured
Notes).
At the Issuer's request, the Trustee or the Paying Agent shall give
the notice of redemption in the Issuer's name and at its expense; provided,
however, that the Issuer shall have delivered to the Trustee, at least 45 days
prior to the redemption date, an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the preceding paragraph.
8. Denominations, Transfer, Exchange. The Senior Secured Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000 in excess thereof. The transfer of Senior Secured Notes may
be registered and Senior Secured Notes may be exchanged as provided in the
Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Issuer may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Issuer need not exchange or register the
transfer of any Senior Secured Note or portion of a Senior Secured Note selected
for redemption, except for the unredeemed portion of any Senior Secured Note
being redeemed in part. Also, the Issuer need not exchange or register the
transfer of any Senior Secured Notes for a period of 15 days before a selection
of Senior Secured Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Senior Secured
Note may be treated as its owner for all purposes.
10. Amendment, Supplement and Waiver. The Issuer and the Trustee may
amend or supplement the Indenture and any of the other Financing Documents
without the consent of the Holders:
(a) to cure any ambiguity, defect or inconsistency;
Exhibit A-1
Page 9
(b) to add additional covenants of the Issuer or its
Subsidiaries, to surrender rights conferred upon the Issuer or its
Subsidiaries, or to confer additional benefits upon the Holders;
(c) to increase the assets securing the Issuer's obligations
under the Indenture;
(d) to allow any Subsidiary to execute a Supplemental Indenture
and/or Guarantee with respect to the Senior Secured Notes;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the Trust Indenture
Act;
(f) to make any change not inconsistent with the terms of the
Indenture that does not adversely affect the legal rights thereunder
of any Holder of the Senior Secured Notes; or
(g) to establish the form and terms of Senior Secured Notes of
any series permitted by Sections 2.01 and 2.03 of the Indenture.
The Indenture and the other Financing Documents may be otherwise
amended or supplemented by the Issuer and the Trustee, with the consent of the
Required Holders; provided that no such amendment or supplement may, without the
consent of all Holders of Outstanding Senior Secured Notes affected thereby:
(a) modify the principal, interest and premium or Liquidated
Damages, if any, payable upon the Senior Secured Notes;
(b) modify the dates on which principal, interest, premium and
Liquidated Damages, if any, on any Senior Secured Notes are paid;
(c) release any Guarantor from its obligations under a Guarantee;
(d) modify the dates of maturity of any Senior Secured Notes; and
(e) make changes in the procedures for amendment, supplement or
waiver.
The Indenture and the other Security Documents may be amended or
supplemented to provide for the release of Collateral, by the Issuer and the
Trustee, with the consent of Holders of not less than 66% of the Outstanding
Senior Secured Notes.
11. Defaults and Remedies. The following events constitute an Event of
Default under the Indenture:
Exhibit A-1
Page 10
(a) the failure to pay or cause to be paid any principal of, interest,
premium, Liquidated Damages, if any, fees or any other obligations on the
Senior Secured Notes for five or more days after the same becomes due and
payable, whether by scheduled maturity or required prepayment or by
acceleration or otherwise;
(b) any representation or warranty made by the Issuer, any Subsidiary
or Ormat Nevada under any Financing Document shall prove to have been
untrue or misleading as of the time made, confirmed or furnished and the
fact, event or circumstance that gave rise to such inaccuracy has had or
could reasonably be expected to result in a Material Adverse Effect and
such fact, event or circumstance shall continue to be uncured for 30 or
more days from the date a Responsible Officer of the Issuer, such
Subsidiary or Ormat Nevada, as the case may be, obtains knowledge thereof;
provided, that if the Issuer, such Subsidiary or Ormat Nevada, as the case
may be, commences efforts to cure such fact, event or circumstance within
such 30-day period, the Issuer, such Subsidiary or Ormat Nevada, as the
case may be, may continue to effect such cure and such misrepresentation
will not be deemed an Event of Default for an additional 90 days so long as
the Issuer, such Subsidiary or Ormat Nevada, as the case may be, is
diligently pursuing such cure;
(c) the failure by the Issuer or any Subsidiary to perform or observe
any covenant under Sections 4.06, 4.07, 4.09, 4.10, 4.11, 4.15, 4.16, 4.18,
4.19, 4.20, 4.23, 4.27 and 4.46 of the Indenture and such failure shall
continue uncured for 30 or more days after a Responsible Officer of the
Issuer obtains knowledge thereof;
(d) the failure by the Issuer, any Subsidiary or Ormat Nevada to
perform or observe any of the other covenants in the Financing Documents
that the Issuer, such Subsidiary or Ormat Nevada is a party to (other than
such failures described in clause (a) or (c) above) and such failure shall
continue uncured for 30 or more days after a Responsible Officer of the
Issuer, any Subsidiary or Ormat Nevada, as the case may be, obtains
knowledge thereof; provided that if the Issuer, any Subsidiary or Ormat
Nevada, as the case may be, commences efforts to cure such default within
such 30-day period, the Issuer, any Subsidiary or Ormat Nevada, as the case
may be, may continue to effect such cure of the default and such default
will not be deemed an Event of Default for an additional 90 days so long as
the Issuer, any Subsidiary or Ormat Nevada, as the case may be, is
diligently pursuing such cure;
(e) the Issuer or any Subsidiary of the Issuer:
(i) admits in writing its inability, or is generally unable, to
pay its debts as the debts become due or makes a general assignment
for the benefit of creditors; or
(ii) commences any case, proceeding or other action seeking
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any applicable liquidation,
conservatorship, bankruptcy,
Exhibit A-1
Page 11
moratorium, arrangement, adjustment, insolvency, reorganization or
similar laws affecting the rights or remedies of creditors generally,
as in effect from time to time (collectively, "Debtor Relief Law"); or
(iii) in any involuntary case, proceeding or other action
commenced against it which seeks to have an order for relief
(injunctive or otherwise) entered against it, as debtor, or seeks
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any Debtor Relief Law, (A) fails
to obtain a dismissal of such case, proceeding or other action within
ninety (90) days of its commencement, or (B) converts the case from
one chapter of the Bankruptcy Reform Act of 1978, as amended, to
another chapter, or (C) is the subject of an order for relief that
remains unstayed and in effect for a period of ninety (90) days; or
(iv) has a trustee, receiver, custodian or other official
appointed for or to take possession of all or any part of its property
or has any court take jurisdiction of any of its property, which
action remains undismissed for a period of ninety (90) days;
(f) the entry of one or more final and non-appealable judgment or
judgments for the payment of money in excess of $10.0 million (exclusive of
judgment amounts covered by insurance) against the Issuer or any
Subsidiary, which remain unpaid or unstayed for a period of 60 or more
consecutive days;
(g) an event of default under any Permitted Indebtedness (other than
Indebtedness referred to in clause (a) above) that results in Indebtedness
in excess of $10.0 million becoming due and payable prior to its stated
maturity;
(h) any Governmental Approval required for the operation of any
Project or any material portion thereof owned by the Issuer or any
Subsidiary is revoked, terminated, withdrawn or ceases to be in full force
and effect if such revocation, termination, withdrawal or cessation has had
or could reasonably be expected to have a Material Adverse Effect and such
revocation, termination, withdrawal or cessation is not cured within 60
days following the occurrence thereof;
(i) any Material Project Document or Third Party Consent or any
material provision thereof (i) ceases to be valid and binding and in full
force and effect prior to its stated maturity date other than as a result
of an amendment or termination permitted under the Indenture or (ii) a
party thereto fails to perform or observe any of its covenants or
obligations thereunder or makes any material misrepresentation thereunder
and such event has had or could reasonably be expected to have a Material
Adverse Effect; provided that, in any such event no such event shall be an
Event of Default if within 180 days from the occurrence of any such event,
(a) such Material Project Document or Third Party Consent or material
provision thereof is reinstated as a valid and binding agreement
Exhibit A-1
Page 12
among the parties thereto, (b) any breaching party resumes performance and
otherwise cures such misrepresentation or failure to perform or observe its
covenants or obligations under the Material Project Documents or Third
Party Consents or (c) in the case of Material Project Documents, the Issuer
enters into an Additional Project Document in replacement thereof, as
permitted under the Indenture;
(j) any of the Security Documents or any other Financing Document
ceases to be in full force and effect or any Lien granted therein ceases to
be a valid and perfected Lien in favor of the Secured Parties on the
Collateral described therein with the priority purported to be created
thereby; provided, however that the Issuer shall have 10 days after any of
the Issuer's or the Issuer's Subsidiaries' Responsible Officers obtains
knowledge thereof to cure any such cessation or to furnish to the Trustee,
the Collateral Agent or the Depositary all documents or instruments
required to cure any such cessation;
(k) the occurrence of a Change of Control; or
(l) the failure of Ormesa to prepay all of the amounts outstanding
under the Ormesa Credit Agreement on or prior to January 31, 2005 or the
failure of the Issuer to cause Ormesa to comply with its obligations under
Sections 4.20 and 4.38 of the Indenture.
If an Event of Default relating to failure to pay amounts owed on the
Senior Secured Notes has occurred and is continuing, the Trustee may
declare the principal amount of the Outstanding Senior Secured Notes, all
interest accrued and unpaid thereon, and all premium and Liquidated
Damages, if any, and other amounts payable under the Senior Secured Notes
and the Indenture, if any, to be due and payable notwithstanding the
absence of written direction from Holders of at least 25% in aggregate
principal amount of the Outstanding Senior Secured Notes directing the
Trustee in writing to accelerate the principal maturity of the Senior
Secured Notes, unless the Required Holders direct the Trustee not to
accelerate the maturity of such Senior Secured Notes, if in the good faith
exercise of its discretion the Trustee determines that such action is
necessary to protect the interests of the Holders. Notwithstanding the
foregoing, in the case of an Event of Default arising from certain events
of bankruptcy or insolvency, all Outstanding Senior Secured Notes will
become due and payable immediately.
12. Trustee Dealings with Issuer. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Issuer or its Affiliates, and may otherwise deal with the
Issuer or its Affiliates, as if it were not the Trustee.
13. No Recourse Against Others. No past, present or future director,
officer, employee, organizer, member, manager or agent of the Issuer or any
Affiliate of any such party (other than the Issuer), as such, shall have any
liability for any obligations of the Issuer under the Senior Secured Notes, the
Indenture, any Financing Document or for any claim based on, in
Exhibit A-1
Page 13
respect of, or by reason of, such obligations or their creation. Each Holder by
accepting a Senior Secured Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Senior
Secured Notes.
14. Authentication. This Senior Secured Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
15. Abbreviations. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
16. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Issuer has caused
CUSIP numbers to be printed on the Senior Secured Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Senior Secured Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.
The Issuer will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Ormat Funding Corp.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
Tel.: (000)000-0000
Fax:(000)000-0000
Attention: President
Exhibit A-1
Page 14
Assignment Form
To assign this Senior Secured Note, fill in the form below: (I) or (we) assign
and transfer this Senior Secured Note to
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
to transfer this Senior Secured Note on the books of the Issuer. The agent may
substitute another to act for him.
Date: Your Signature:
-----------------------
(Sign exactly as your
name appears on the
Senior Secured Note)
Tax Identification No:
----------------
Signature Guarantee.
Medallion No.:
Notice: Signature must be guaranteed by a member firm of the STAMP, SEMP or MSP
signature guaranty medallion program
Exhibit X-x
Xxxx 15
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Certificated Note, or exchanges of a part of
another Global Note or Certificated Note for an interest in this Global Note,
have been made:
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized
Principal Amount Principal Amount Note following officer of
Date of of this of this such decrease Trustee or Note
Exchange Global Note Global Note (or increase) Custodian
-------- ---------------- ---------------- ---------------- ---------------
Exhibit A-1
Page 16
SCHEDULE I
SCHEDULE OF PRINCIPAL PAYMENTS
The principal of the Senior Secured Notes will be payable in
semi-annual installments, commencing June 30, 2004, as follows:
SCHEDULED PAYMENT DATE PRINCIPAL AMOUNT PAYABLE(1)
---------------------- ---------------------------
June 30, 2004 .................................... $ 215,305
December 30, 2004 ................................ 296,077
June 30, 2005 .................................... 2,982,569
December 30, 2005 ................................ 3,107,308
June 30, 2006 .................................... 4,707,100
December 30, 2006 ................................ 4,903,964
June 30, 2007 .................................... 4,374,290
December 30, 2007 ................................ 4,557,235
June 30, 2008 .................................... 3,837,232
December 30, 2008 ................................ 3,997,716
June 30, 2009 .................................... 4,477,107
December 30, 2009 ................................ 4,664,353
June 30, 2010 .................................... 4,955,198
December 30, 2010 ................................ 5,162,439
June 30, 2011 .................................... 5,588,336
December 30, 2011 ................................ 5,822,056
June 30, 2012 .................................... 5,388,039
December 30, 2012 ................................ 5,613,382
June 30, 2013 .................................... 5,849,423
December 30, 2013 ................................ 6,094,063
June 30, 2014 .................................... 6,796,100
December 30, 2014 ................................ 7,052,203
June 30, 2015 .................................... 7,916,885
December 30, 2015 ................................ 8,247,993
June 30, 2016 .................................... 8,458,680
December 30, 2016 ................................ 8,812,447
June 30, 2017 .................................... 9,084,414
December 30, 2017 ................................ 9,464,350
June 30, 2018 .................................... 6,481,436
December 30, 2018 ................................ 6,752,509
June 30, 2019 .................................... 5,823,102
December 30, 2019 ................................ 6,066,641
June 30, 2020 .................................... 6,111,116
December 30, 2020 ................................ 6,365,934
----------
(1) Represents the principal amount payable with respect to $190,000,000 of
Senior Secured Notes through the Final Maturity Date. The Holder of this
Senior Secured Note shall be entitled to a pro rata portion of the
principal amount set forth in this schedule on each Scheduled Payment Date
based on the principal sum set forth on the face of this Senior Secured
Note as adjusted in the attached Schedule of Exchanges of Interests in the
Global Note.
EXHIBIT A-2
(Face of Regulation S Temporary Global Note)
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON."
"THE SENIOR SECURED NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT BY THE INITIAL
INVESTOR (1) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), IN EACH CASE, IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES."
ExhibitA-2
Page 2
================================================================================
CUSIP/CINS: U68283 AA5
8 1/4% Senior Secured Notes due 2020
No. $
-- --------
ORMAT FUNDING CORP.
promises to pay to Cede & Co., or registered assigns, the principal sum of
___________ Dollars in installments on the dates and in the amounts as set forth
in Schedule I attached hereto and made part hereof.
Interest Payment Dates: June 30 and December 30
Record Dates: June 15 and December 15
DATED:
ORMAT FUNDING CORP.
By:
----------------------------------------
Name:
Title:
This is one of the Global Notes referred to
in the within-mentioned Indenture:
Union Bank of California, N.A.,
as Trustee
By:
----------------------------------
Name:
Exhibit A-2
Page 3
(Back of Regulation S Temporary Global Note)
8 1/4% Senior Secured Notes due December 30, 2020
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. Interest. Ormat Funding Corp., a Delaware corporation (the
"Issuer"), promises to pay interest on the outstanding principal amount of this
Senior Secured Note at 8 1/4% per annum from the date of issuance until the
Final Maturity Date. The Issuer shall pay interest and Liquidated Damages, if
any, pro rata semi-annually in arrears on June 30 and December 30 of each year
(the "Interest Payment Date"), or if any such day is not a Business Day, on the
next succeeding Business Day. Interest on the Senior Secured Notes will accrue
from the most recent Interest Payment Date to which interest has been paid or,
if no interest has been paid, from the date of issuance; provided that if there
is no existing Default in the payment of interest, and if this Senior Secured
Note is authenticated between a record date referred to on the face hereof and
the next succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be June 30, 2004. The Issuer shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate that is 1%
per annum in excess of the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months.
2. Method of Payment. The Issuer will pay interest and payments of
principal in accordance with Schedule I attached hereto on the Senior Secured
Notes (except defaulted interest) and Liquidated Damages, if any, to the Persons
who are registered Holders of Senior Secured Notes at the close of business on
the June 15 or December 15 next preceding the Interest Payment Date, even if
such Senior Secured Notes are cancelled after such record date and on or before
such Interest Payment Date, except as provided in Section 2.12 of the Indenture
with respect to defaulted interest. The Senior Secured Notes will be payable as
to principal, premium and Liquidated Damages, if any, and interest at the office
or agency of the Issuer maintained for such purpose within or without the City
and State of New York, or, at the option of the Issuer, payment of interest may
be made by check mailed to the Holders at their addresses set forth in the
register of Holders, and provided that payment by wire transfer of immediately
available funds will be required with respect to principal of, interest, premium
and Liquidated Damages on all Global Notes and all other Senior Secured Notes
the Holders of which shall have provided wire transfer instructions to the
Issuer or the Paying Agent. Such payment shall be in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.
Exhibit A-2
Page 4
3. Paying Agent and Registrar. Initially, Union Bank of California, N.
A., the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Issuer may change any Paying Agent or Registrar without notice to any Holder.
The Issuer or any of its Subsidiaries may act in any such capacity.
4. Indenture. The Issuer issued the Senior Secured Notes under an
Indenture dated as of February 13, 2004 among the Issuer, Xxxxx Power Partners,
Steamboat Development Corp., Steamboat Geothermal LLC, OrMammoth Inc., ORNI 1
LLC, ORNI 2 LLC, ORNI 7 LLC, Ormesa LLC and Union Bank of California, N.A., as
Trustee. The terms of the Senior Secured Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Senior Secured Notes are subject to all such terms, and Holders are referred to
the Indenture and such Act for a statement of such terms. To the extent any
provision of this Senior Secured Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be controlling.
5. Optional Redemption. (a) The Senior Secured Notes shall be
redeemable at the option of the Issuer at any time and from time to time, in
whole or in part, upon not less than 30 nor more than 60 days' notice to the
Trustee and each Holder of Senior Secured Notes, at a redemption price equal to
the outstanding principal amount thereof plus accrued interest and Liquidated
Damages, if any, plus the Make-Whole Premium, such redemption price to be set
forth in the notice to the Trustee. In no event shall the sum of the redemption
price plus the Make-Whole Premium ever be less than 100% of the Senior Secured
Notes being redeemed plus accrued and unpaid interest thereon to the Redemption
Date. Unless the Issuer defaults in payment of the redemption price, on and
after the Redemption Date interest and Liquidated Damages, if any, shall cease
to accrue on the Senior Secured Notes or portions thereof called for redemption.
(b) Any redemption pursuant to this subparagraph 5 shall be made
pursuant to the provisions of Section 3.01 through 3.06 of the Indenture.
6. Mandatory Redemption. (a) The Senior Secured Notes shall be subject
to mandatory redemption, in whole or in part, at a redemption price equal to the
principal amount of the Senior Secured Notes being redeemed plus accrued and
unpaid interest and Liquidated Damages, if any, to the Redemption Date, if the
Issuer or any Subsidiary receives more than $5.0 million of Loss Proceeds or
Eminent Domain Proceeds because of an Event of Loss or an Event of Eminent
Domain and:
(i) the Issuer determines that all or such portion of the applicable
Plant cannot be rebuilt, repaired or restored to permit
operations on a commercially reasonable basis, or the Issuer
determines not to rebuild, repair or restore the applicable Plant
or such portion, in which case the Issuer shall have to use the
Net Available Amount of such proceeds for such redemption; or
Exhibit A-2
Page 5
(ii) only a portion of the applicable Plant is capable of being
rebuilt, repaired or restored on a commercially reasonable basis
and the Issuer determines to so rebuild, repair or restore, in
which case the Issuer will have to use only the amount of such
Loss Proceeds or Eminent Domain Proceeds not used to rebuild,
repair or restore such Plant for such redemption, except as set
forth in the immediately following paragraph.
If the Issuer or any Subsidiary receives less than $5 million of Loss
Proceeds or Eminent Domain Proceeds or has less than $5 million remaining after
rebuilding, repairing or restoring a portion of the applicable Plant because of
an Event of Loss or Event of Eminent Domain the Issuer will cause such amounts
to be deposited into the Revenue Account.
(b) If the Issuer or any Subsidiary (a) receives more than $5.0
million of Title Event Proceeds in connection with a Title Event and is unable
to remedy the Title Event, or (b) has more than $5.0 million of Title Event
Proceeds remaining after remedying the Title Event, the Issuer will have to use
the Net Available Amount of such proceeds, to the extent not used to cure the
Title Event, on a pro rata basis to redeem the Senior Secured Notes at a
redemption price equal to the principal amount of the Senior Secured Notes being
redeemed plus accrued and unpaid interest and Liquidated Damages, if any, to the
Redemption Date. If the Issuer or any Subsidiary receives less than $5 million
of Title Event Proceeds in connection with a Title Event or has less than $5
million remaining after remedying a Title Event the Issuer will cause such
amounts to be deposited into the Revenue Account.
(c) If on or prior to September 30, 2005, the Issuer has not satisfied
the Initial Galena Re-powering Account Withdrawal Conditions, then the Issuer
will have to use the proceeds of the Galena Re-powering Account to redeem Senior
Secured Notes at a price equal to 101% of the principal amount of Senior Secured
Notes being redeemed plus accrued and unpaid interest and Liquidated Damages, if
any, to the Redemption Date.
(d) If Final Completion is not achieved by March 31, 2006 or the
Galena Repowering does not result in a minimum net electrical output of 18 MW as
determined in accordance with performance tests conducted pursuant to the Galena
Repowering Contract (as certified by the Independent Engineer), then from and
after March 31, 2006, the Issuer will not be able to make any Restricted
Payments until the Issuer has used any amounts the Issuer receives as
Performance Liquidated Damages and amounts in the Distribution Suspense Account
to redeem or has otherwise redeemed (a "Galena Re-powering Performance
Redemption") Senior Secured Notes in an amount equal to the product of (x)
$1,100,000 times (y) the difference between (i) 18 MW minus (ii)the actual
number of Megawatts of the Galena Re-powering as demonstrated by the Performance
Guarantee Tests and certified by the Independent Engineer. The Issuer will
redeem the Senior Secured Notes in connection with a Galena Re- powering
Performance Redemption at a price equal to 101% of the principal amount of the
Senior Secured Notes required to be redeemed plus accrued and unpaid interest
and Liquidated Damages, if any, to the Redemption Date.
Exhibit A-2
Page 6
(e) If, as of January 1, 2006, the Mammoth Enhancement has not
improved the net electrical output of the Mammoth Plant by at least 3.6 MW (as
certified by the Independent Engineer), then from and after January 1, 2006, the
Issuer will not be able to make any Restricted Payments until the Issuer has
used amounts in the Distribution Suspense Account to redeem or has otherwise
redeemed (a "Mammoth Enhancement Redemption") Senior Secured Notes in an amount
equal to the product of (x) $1,100,000 times (y) the difference between (i) 3.6
MW minus (ii) the actual number of Megawatts that the Mammoth Enhancement
increases the net electrical output of the Mammoth Plant. The Issuer shall
redeem the Senior Secured Notes in connection with a Mammoth Enhancement
Redemption at a price equal to 101% of the principal amount of the Senior
Secured Notes required to be redeemed plus accrued and unpaid interest and
Liquidated Damages, if any, to the Redemption Date.
In the event that any Senior Secured Obligations (other than the
Senior Secured Notes) are required to be redeemed before their scheduled
maturity pursuant to documents governing such Senior Secured Obligations for any
reason not otherwise giving rise to a redemption of the Senior Secured Notes,
the Issuer shall offer to repurchase the Senior Secured Notes on a pro rata
basis with the other Senior Secured Obligations as are required to be redeemed
at a redemption price equal to the principal amount of the Senior Secured Notes
the Issuer offers to repurchase plus accrued and unpaid interest and Liquidated
Damages, if any, to the Redemption Date, but without any premium.
Other than as specifically provided in this subparagraph 6, any
purchase or redemption pursuant to this subparagraph 6 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 of the Indenture.
7. Notice of Redemption. At least 30 days but not more than 60 days
before a Redemption Date, the Issuer shall mail or cause to be mailed, by first
class mail, a notice of redemption to each Holder whose Senior Secured Notes are
to be redeemed at its registered address.
The notice shall identify the Senior Secured Notes to be redeemed and
shall state:
(a) the Redemption Date;
(b) the redemption price;
(c) if any Senior Secured Note is being redeemed in part, the portion
of the principal amount of such Senior Secured Note to be redeemed and
that, after the redemption date upon surrender of such Senior Secured Note,
a new Senior Secured Note or Senior Secured Notes in principal amount equal
to the unredeemed portion shall be issued upon cancellation of the original
Senior Secured Note;
(d) the name, address and telephone number of the Paying Agent;
Exhibit A-2
Page 7
(e) that Senior Secured Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(f) that, unless the Issuer defaults in making such redemption
payment, interest and Liquidated Damages, if any, on Senior Secured Notes
called for redemption ceases to accrue on and after the Redemption Date;
(g) the paragraph of the Senior Secured Notes and/or Section of the
Indenture pursuant to which the Senior Secured Notes called for redemption
are being redeemed; and
(h) the CUSIP number (provided that the Issuer may state that no
representation is made as to the correctness or accuracy of the CUSIP
number, if any, listed in such notice or printed on the Senior Secured
Notes).
At the Issuer's request, the Trustee or the Paying Agent shall give
the notice of redemption in the Issuer's name and at its expense; provided,
however, that the Issuer shall have delivered to the Trustee, at least 45 days
prior to the redemption date, an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the preceding paragraph.
8. Denominations, Transfer, Exchange. The Senior Secured Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000 in excess thereof. The transfer of Senior Secured Notes may
be registered and Senior Secured Notes may be exchanged as provided in the
Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Issuer may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Issuer need not exchange or register the
transfer of any Senior Secured Note or portion of a Senior Secured Note selected
for redemption, except for the unredeemed portion of any Senior Secured Note
being redeemed in part. Also, the Issuer need not exchange or register the
transfer of any Senior Secured Notes for a period of 15 days before a selection
of Senior Secured Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Senior Secured
Note may be treated as its owner for all purposes.
10. Amendment, Supplement and Waiver. The Issuer and the Trustee may
amend or supplement the Indenture and any of the other Financing Documents
without the consent of the Holders:
(a) to cure any ambiguity, defect or inconsistency;
(b) to add additional covenants of the Issuer or its Subsidiaries, to
surrender rights conferred upon the Issuer or its Subsidiaries, or to confer
additional benefits upon the Holders;
Exhibit A-2
Page 8
(c) to increase the assets securing the Issuer's obligations under the
Indenture;
(d) to allow any Subsidiary to execute a Supplemental Indenture and/or
Guarantee with respect to the Senior Secured Notes;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the Trust Indenture Act;
(f) to make any change not inconsistent with the terms of the
Indenture that does not adversely affect the legal rights thereunder of any
Holder of the Senior Secured Notes; or
(g) to establish the form and terms of Senior Secured Notes of any
series permitted by Sections 2.01 and 2.03 of the Indenture.
The Indenture and the other Financing Documents may be otherwise
amended or supplemented by the Issuer and the Trustee, with the consent of the
Required Holders; provided that no such amendment or supplement may, without the
consent of all Holders of Outstanding Senior Secured Notes affected thereby:
(a) modify the principal, interest and premium or Liquidated Damages,
if any, payable upon the Senior Secured Notes;
(b) modify the dates on which principal, interest, premium and
Liquidated Damages, if any, on any Senior Secured Notes are paid;
(c) release any Guarantor from its obligations under a Guarantee;
(d) modify the dates of maturity of any Senior Secured Notes; and
(e) make changes in the procedures for amendment, supplement or
waiver.
The Indenture and the other Security Documents may be amended or
supplemented to provide for the release of Collateral, by the Issuer and the
Trustee, with the consent of Holders of not less than 66% of the Outstanding
Senior Secured Notes.
11. Defaults and Remedies. The following events constitute an Event of
Default under the Indenture:
(a) the failure to pay or cause to be paid any principal of, interest,
premium, Liquidated Damages, if any, fees or any other obligations on the
Senior Secured Notes for five or more days after the same becomes due and
payable, whether by scheduled maturity or required prepayment or by
acceleration or otherwise;
Exhibit A-2
Page 9
(b) any representation or warranty made by the Issuer, any Subsidiary
or Ormat Nevada under any Financing Document shall prove to have been
untrue or misleading as of the time made, confirmed or furnished and the
fact, event or circumstance that gave rise to such inaccuracy has had or
could reasonably be expected to result in a Material Adverse Effect and
such fact, event or circumstance shall continue to be uncured for 30 or
more days from the date a Responsible Officer of the Issuer, such
Subsidiary or Ormat Nevada, as the case may be, obtains knowledge thereof;
provided, that if the Issuer, such Subsidiary or Ormat Nevada, as the case
may be, commences efforts to cure such fact, event or circumstance within
such 30-day period, the Issuer, such Subsidiary or Ormat Nevada, as the
case may be, may continue to effect such cure and such misrepresentation
will not be deemed an Event of Default for an additional 90 days so long as
the Issuer, such Subsidiary or Ormat Nevada, as the case may be, is
diligently pursuing such cure;
(c) the failure by the Issuer or any Subsidiary to perform or observe
any covenant under Sections 4.06, 4.07, 4.09, 4.10, 4.11, 4.15, 4.16, 4.18,
4.19, 4.20, 4.23, 4.27 and 4.46 of the Indenture and such failure shall
continue uncured for 30 or more days after a Responsible Officer of the
Issuer obtains knowledge thereof;
(d) the failure by the Issuer, any Subsidiary or Ormat Nevada to
perform or observe any of the other covenants in the Financing Documents
that the Issuer, such Subsidiary or Ormat Nevada is a party to (other than
such failures described in clause (a) or (c) above) and such failure shall
continue uncured for 30 or more days after a Responsible Officer of the
Issuer, any Subsidiary or Ormat Nevada, as the case may be, obtains
knowledge thereof; provided that if the Issuer, any Subsidiary or Ormat
Nevada, as the case may be, commences efforts to cure such default within
such 30-day period, the Issuer, any Subsidiary or Ormat Nevada, as the case
may be, may continue to effect such cure of the default and such default
will not be deemed an Event of Default for an additional 90 days so long as
the Issuer, any Subsidiary or Ormat Nevada, as the case may be, is
diligently pursuing such cure;
(e) the Issuer or any Subsidiary of the Issuer:
(i) admits in writing its inability, or is generally unable, to
pay its debts as the debts become due or makes a general assignment
for the benefit of creditors; or
(ii) commences any case, proceeding or other action seeking
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any applicable liquidation,
conservatorship, bankruptcy, moratorium, arrangement, adjustment,
insolvency, reorganization or similar laws affecting the rights or
remedies of creditors generally, as in effect from time to time
(collectively, "Debtor Relief Law"); or
Exhibit A-2
Page 10
(iii) in any involuntary case, proceeding or other action
commenced against it which seeks to have an order for relief
(injunctive or otherwise) entered against it, as debtor, or seeks
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any Debtor Relief Law, (A) fails
to obtain a dismissal of such case, proceeding or other action within
ninety (90) days of its commencement, or (B) converts the case from
one chapter of the Bankruptcy Reform Act of 1978, as amended, to
another chapter, or (C) is the subject of an order for relief that
remains unstayed and in effect for a period of ninety (90) days; or
(iv) has a trustee, receiver, custodian or other official
appointed for or to take possession of all or any part of its property
or has any court take jurisdiction of any of its property, which
action remains undismissed for a period of ninety (90) days;
(f) the entry of one or more final and non-appealable judgment or
judgments for the payment of money in excess of $10.0 million (exclusive of
judgment amounts covered by insurance) against the Issuer or any
Subsidiary, which remain unpaid or unstayed for a period of 60 or more
consecutive days;
(g) an event of default under any Permitted Indebtedness (other than
Indebtedness referred to in clause (a) above) that results in Indebtedness
in excess of $10.0 million becoming due and payable prior to its stated
maturity;
(h) any Governmental Approval required for the operation of any
Project or any material portion thereof owned by the Issuer or any
Subsidiary is revoked, terminated, withdrawn or ceases to be in full force
and effect if such revocation, termination, withdrawal or cessation has had
or could reasonably be expected to have a Material Adverse Effect and such
revocation, termination, withdrawal or cessation is not cured within 60
days following the occurrence thereof;
(i) any Material Project Document or Third Party Consent or any
material provision thereof (i) ceases to be valid and binding and in full
force and effect prior to its stated maturity date other than as a result
of an amendment or termination permitted under the Indenture or (ii) a
party thereto fails to perform or observe any of its covenants or
obligations thereunder or makes any material misrepresentation thereunder
and such event has had or could reasonably be expected to have a Material
Adverse Effect; provided that, in any such event no such event shall be an
Event of Default if within 180 days from the occurrence of any such event,
(a) such Material Project Document or Third Party Consent or material
provision thereof is reinstated as a valid and binding agreement among the
parties thereto, (b) any breaching party resumes performance and otherwise
cures such misrepresentation or failure to perform or observe its covenants
or obligations under the Material Project Documents or Third Party Consents
or (c) in the case of
Exhibit A-2
Page 11
Material Project Documents, the Issuer enters into an Additional Project
Document in replacement thereof, as permitted under the Indenture;
(j) any of the Security Documents or any other Financing Document
ceases to be in full force and effect or any Lien granted therein ceases to
be a valid and perfected Lien in favor of the Secured Parties on the
Collateral described therein with the priority purported to be created
thereby; provided, however, that the Issuer shall have 10 days after any of
the Issuer's or the Issuer's Subsidiaries' Responsible Officers obtains
knowledge thereof to cure any such cessation or to furnish to the Trustee,
the Collateral Agent or the Depositary all documents or instruments
required to cure any such cessation;
(k) the occurrence of a Change of Control; or
(l) the failure of Ormesa to prepay all of the amounts outstanding
under the Ormesa Credit Agreement on or prior to January 31, 2005 or the
failure of the Issuer to cause Ormesa to comply with its obligations under
Sections 4.20 and 4.38 of the Indenture.
If an Event of Default relating to failure to pay amounts owed on the
Senior Secured Notes has occurred and is continuing, the Trustee may declare the
principal amount of the Outstanding Senior Secured Notes, all interest accrued
and unpaid thereon, and all premium and Liquidated Damages, if any, and other
amounts payable under the Senior Secured Notes and the Indenture, if any, to be
due and payable notwithstanding the absence of written direction from Holders of
at least 25% in aggregate principal amount of the Outstanding Senior Secured
Notes directing the Trustee in writing to accelerate the principal maturity of
the Senior Secured Notes, unless the Required Holders direct the Trustee not to
accelerate the maturity of such Senior Secured Notes, if in the good faith
exercise of its discretion the Trustee determines that such action is necessary
to protect the interests of the Holders. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, all Outstanding Senior Secured Notes will become due and payable
immediately.
12. Trustee Dealings with Issuer. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Issuer or its Affiliates, and may otherwise deal with the
Issuer or its Affiliates, as if it were not the Trustee.
13. No Recourse Against Others. No past, present or future director,
officer, employee, organizer, member, manager or agent of the Issuer or any
Affiliate of any such party (other than the Issuer), as such, shall have any
liability for any obligations of the Issuer under the Senior Secured Notes, the
Indenture, any Financing Document or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder by accepting a
Senior Secured Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Senior Secured Notes.
Exhibit A-2
Page 12
14. Authentication. This Senior Secured Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
15. Abbreviations. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
16. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Issuer has caused
CUSIP numbers to be printed on the Senior Secured Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Senior Secured Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.
The Issuer will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Ormat Funding Corp.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
Tel.: (000)000-0000
Fax: (000)000-0000
Attention: President
Exhibit A-2
Page 13
Assignment Form
To assign this Senior Secured Note, fill in the form below: (I) or (we) assign
and transfer this Senior Secured Note to
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
to transfer this Senior Secured Note on the books of the Issuer. The agent may
substitute another to act for him.
Date: Your Signature:
-----------------------------------------
(Sign exactly as your name appears on the
Senior Secured Note)
Tax Identification No:
----------------------------------
Signature Guarantee.
Medallion No.:
Notice: Signature must be guaranteed by a member firm of the STAMP, SEMP or MSP
signature guaranty medallion program.
Exhibit A-2
Page 14
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note, or of other Restricted
Global Notes for an interest in this Regulation S Temporary Global Note, have
been made:
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized
Principal Amount Principal Amount Note following officer of
Date of of this of this such decrease Trustee or
Exchange Global Note Global Note (or increase) Note Custodian
-------- ---------------- ---------------- ---------------- --------------
Exhibit A-2
Page 15
SCHEDULE I
SCHEDULE OF PRINCIPAL PAYMENTS
The principal of the Senior Secured Notes will be payable in
semi-annual installments, commencing June 30, 2004, as follows:
SCHEDULED PAYMENT DATE PRINCIPAL AMOUNT PAYABLE(2)
---------------------- ---------------------------
June 30,2004 ........................... $ 215,305
December 30, 2004 ...................... 296,077
June 30, 2005 .......................... 2,982,569
December 30, 2005 ...................... 3,107,308
June 30, 2006 .......................... 4,707,100
December 30, 2006 ...................... 4,903,964
June 30, 2007 .......................... 4,374,290
December 30, 2007 ...................... 4,557,235
June 30, 2008 .......................... 3,837,232
December 30, 2008 ...................... 3,997,716
June 30, 2009 .......................... 4,477,107
December 30, 2009 ...................... 4,664,353
June 30, 2010 .......................... 4,955,198
December 30, 2010 ...................... 5,162,439
June 30, 2011 .......................... 5,588,336
December 30, 2011 ...................... 5,822,056
June 30, 2012 .......................... 5,388,039
December 30, 2012 ...................... 5,613,382
June 30, 2013 .......................... 5,849,423
December 30, 2013 ...................... 6,094,063
June 30, 2014 .......................... 6,796,100
December 30, 2014 ...................... 7,052,203
June 30, 2015 .......................... 7,916,885
December 30, 2015 ...................... 8,247,993
June 30, 2016 .......................... 8,458,680
December 30, 2016 ...................... 8,812,447
June 30, 2017 .......................... 9,084,414
December 30, 2017 ...................... 9,464,350
June 30, 2018 .......................... 6,481,436
December 30, 2018 ...................... 6,752,509
June 30, 2019 .......................... 5,823,102
December 30, 2019 ...................... 6,066,641
June 30, 2020 .......................... 6,111,116
December 30, 2020 ...................... 6,365,934
----------
(2) Represents the principal amount payable with respect to $190,000,000 of
Senior Secured Notes through the Final Maturity Date. The Holder of this
Senior Secured Note shall be entitled to a pro rata portion of the
principal amount set forth in this schedule on each Scheduled Payment Date
based on the principal sum set forth on the face of this Senior Secured
Note as adjusted in the attached Schedule of Exchanges of Interests in the
Global Note.
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Ormat Funding Corp.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
Tel.: (000) 000-0000
Fax: (000)000-0000
Attention: President
Union Bank of California, N.A.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Tel.: (000)000-0000
Fax:(000)000-0000
Attention: Corporate Trust Department
Re: 8 1/4% Senior Secured Notes Due December 30, 2020
Reference is hereby made to this Indenture, dated as of February 13,
2004 (the "Indenture"), among Ormat Funding Corp., as issuer, Xxxxx Power
Partners, Steamboat Development Corp., Steamboat Geothermal LLC, OrMammoth Inc.,
ORNI 1 LLC, ORNI 2 LLC, ORNI 7 LLC, as guarantors, Ormesa LLC and Union Bank of
California, N.A., as trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in this Indenture.
__________________, (the "Transferor") owns and proposes to transfer
the Senior Secured Note [s] or interest in such Senior Secured Note [s]
specified in Annex A hereto, in the principal amount of $_________________ in
such Senior Secured Note [s] or interests (the "Transfer"), to ______ (the
"Transferee"), as further specified in Annex A hereto. In connection with the
Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [_] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
GLOBAL NOTE OR A CERTIFICATED NOTE PURSUANT TO RULE 144A. The Transfer is being
effected pursuant to and in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the
Transferor hereby further certifies that the beneficial interest or Certificated
Note is being transferred to a Person that the Transferor reasonably believed
and believes is purchasing the beneficial interest or Certificated Note for its
own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Transfer in accordance with the terms of this
Indenture, the transferred beneficial interest or Certificated Note will be
subject to the
Exhibit B
Page 2
restrictions on transfer enumerated in the Private Placement Legend printed on
the Global Note and/or the Certificated Note and in this Indenture and the
Securities Act.
2. [_] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
TEMPORARY REGULATION S GLOBAL NOTE, THE REGULATION S GLOBAL NOTE OR A
CERTIFICATED NOTE PURSUANT TO REGULATION S. The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act
and, accordingly, the Transferor hereby further certifies that (i) the Transfer
is not being made to a person in the United States and (x) at the time the buy
order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act and (iii)
the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and (iv) if the proposed transfer is being
made prior to the expiration of the Restricted Period, the transfer is not being
made to a U.S. Person or for the account or benefit of a U.S. Person (other than
an Initial Purchaser). Upon consummation of the proposed transfer in accordance
with the terms of this Indenture, the transferred beneficial interest or
Certificated Note will be subject to the restrictions on Transfer enumerated in
the Private Placement Legend printed on the Regulation S Global Note, the
Temporary Regulation S Global Note and/or the Certificated Note and in this
Indenture and the Securities Act.
3. [_] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE CERTIFICATED NOTE OR A CERTIFICATED NOTE PURSUANT TO ANY
PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Certificated Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) such Transfer is being effected to the Issuer or a subsidiary
thereof;
or
(c) such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance
with the prospectus delivery requirements of the Securities Act.
Exhibit B
Page 3
or
(d) such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144
or Rule 904, and the Transferor hereby further certifies that it
has not engaged in any general solicitation within the meaning of
Regulation D under the Securities Act and the Transfer complies
with the transfer restrictions applicable to beneficial interests
in a Restricted Global Note or Restricted Definitive Notes and
the requirements of the exemption claimed, which certification is
supported by (1) a certificate executed by the Transferee
certifying that such Transferee is an Institutional Accredited
Investor and (2) if such Transfer is in respect of a principal
amount of Senior Secured Notes at the time of transfer of less
than $250,000, an Opinion of Counsel provided by the Transferor
or the Transferee (a copy of which the Transferor has attached to
this certification), to the effect that such Transfer is in
compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of this Indenture,
the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Definitive Note and/or the
Definitive Notes and in this Indenture and the Securities Act.
4. [_] Check if Transferee will take delivery of a beneficial interest in an
Unrestricted Global Note or of an Unrestricted Certificated Note.
(a) [_] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in this Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in this Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of this Indenture, the transferred beneficial interest or
Certificated Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Certificated Notes and in this Indenture.
(b) [_] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is
being effected pursuant to and in accordance with Rule 903 or Rule 904 under the
Securities Act and in compliance with the transfer restrictions contained in
this Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in this Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of this Indenture, the transferred beneficial
interest or Certificated Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Certificated Notes and in this Indenture.
Exhibit B
Page 4
(c) [_] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer
is being effected pursuant to and in compliance with an exemption from the
registration requirements of the Securities Act other than Rule 144, Rule 903 or
Rule 904 and in compliance with the transfer restrictions contained in this
Indenture and any applicable blue sky securities laws of any State of the United
States and (ii) the restrictions on transfer contained in this Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of this Indenture, the transferred beneficial interest or
Certificated Note will not be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Global Notes or
Restricted Certificated Notes and in this Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuer.
----------------------------------------
[Insert Name of Transferor]
BY:
------------------------------------
Name:
Title:
Dated: ,
----------- ----
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [_] a beneficial interest in the:
(i) [_] Global Note (CUSIP ____), or
(ii) [_] Regulation S Global Note (CUSIP ____), or
(iii) [_] Certificated Note (Number ____); or
(b) [_] a Restricted Certificated Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [_] a beneficial interest in the:
(i) [_] Global Note (CUSIP ____), or
(ii) [_] Regulation S Global Note (CUSIP ____), or
(iii) [_] Certificated Note (CUSIP ____); or
(iv) [_] Unrestricted Global Note (CUSIP ____); or
(b) [_] a Restricted Certificated Note; or
(c) [_] an Unrestricted Certificated Note, in accordance with the terms of
this Indenture.
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Ormat Funding Corp.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
Tel.: (000) 000-0000
Fax: (000)000-0000
Attention: President
Union Bank of California, N.A.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Tel.: (000)000-0000
Fax: (000)000-0000
Attention: Corporate Trust Department
Re: 8 1/4% Senior Secured Notes Due December 30, 2020
(CUSIP ________________)
Reference is hereby made to this Indenture, dated as of February 13,
2004 (the "Indenture"), among Ormat Funding Corp., as issuer, Xxxxx Power
Partners, Steamboat Development Corp., Steamboat Geothermal LLC, OrMammoth Inc.,
ORNI 1 LLC, ORNI 2 LLC, ORNI 7 LLC, as guarantors, Ormesa LLC and Union Bank of
California, N.A., as trustee. Capitalized terms used but not defined herein
shall have the meanings given to them in this Indenture.
____________, (the "Owner") owns and proposes to exchange the Senior
Secured Note [s] or interest in such Senior Secured Note [s] specified herein,
in the principal amount of $________________ in such Senior Secured Note [s] or
interests (the "Exchange"). In connection with the Exchange, the Owner hereby
certifies that:
1. Exchange of Restricted Certificated Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Certificated Notes or Beneficial
Interests in an Unrestricted Global Note
(a) [_] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant
Exhibit C
Page 2
to and in accordance with the United States Securities Act of 1933, as amended
(the "Securities Act"), (iii) the restrictions on transfer contained in this
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest in an
Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(b) [_] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED CERTIFICATED NOTE. In connection with the Exchange
of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Certificated Note, the Owner hereby certifies (i) the Certificated
Note is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in this
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Certificated Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(c) [_] CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Certificated Note for a beneficial interest in
an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Certificated Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in this
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [_] CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
UNRESTRICTED CERTIFICATED NOTE. In connection with the Owner's Exchange of a
Restricted Certificated Note for an Unrestricted Certificated Note, the Owner
hereby certifies (i) the Unrestricted Certificated Note is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to Restricted
Certificated Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in this Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Certificated Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
2. Exchange of Restricted Certificated Notes or Beneficial Interests in
Restricted Global Notes for Restricted Certificated Notes or Beneficial
Interests in Restricted Global Notes.
(a) [_] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED CERTIFICATED NOTE. In connection with the Exchange of
the Owner's beneficial
Exhibit C
Page 3
interest in a Restricted Global Note for a Restricted Certificated Note with an
equal principal amount, the Owner hereby certifies that the Restricted
Certificated Note is being acquired for the Owner's own account without
transfer. Upon consummation of the proposed Exchange in accordance with the
terms of this Indenture, the Restricted Certificated Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Certificated Note and in this
Indenture and the Securities Act.
(b) [_] CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE OR CERTIFICATED NOTE. In
connection with the Exchange of the Owner's Restricted Certificated Note for a
beneficial interest in the [CHECK ONE] [_] "Global Note", [_] "Regulation S
Global Note", [_] "Certificated Note" with an equal principal amount, the Owner
hereby certifies (i) the beneficial interest is being acquired for the Owner's
own account without transfer and (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Restricted Global
Notes and pursuant to and in accordance with the Securities Act, and in
compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Exchange in accordance with the
terms of this Indenture, the beneficial interest issued will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the relevant Restricted Global Note and in this Indenture and the Securities Act
Exhibit C
Page 4
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuer.
-----------------------------------
[Insert Name of Owner]
By:
--------------------------------
Name:
Title:
Dated: ,
---------- ----
EXHIBIT D
SUBORDINATION PROVISIONS
Section 1. Definitions and Rules of Interpretation. Except as
otherwise specified, capitalized terms used herein without definition shall have
the meanings assigned to such terms in the Indenture. In addition, the following
terms shall have the following meanings:
1.1 "Subordinated Debt" shall mean any Indebtedness of the Issuer permitted to
be incurred pursuant to clause (vi) of the definition of Permitted
Indebtedness under the Indenture.
1.2 "Subordinated Debt Pledge Agreement" means an agreement executed and
delivered by the parties hereto substantially in the form of the Pledge
Agreements with such changes thereto as may be necessary to ensure that a
first priority Lien and security interest is created and maintained in
favor of the Collateral Agent for the benefit of the Secured Parties.
1.3 "Subordinated Lenders" shall mean each and every lender to whom any of the
Subordinated Debt is owed and any holder of any document evidencing such
Subordinated Debt.
Section 2. Ranking of Senior Secured Obligations
2.1 Until the final maturity date of the Senior Secured Obligations, (i) the
Subordinated Lenders and the Issuer hereby agree that all Subordinated Debt
is and shall be subordinated in right of payment and liquidation in
relation to all Senior Secured Obligations to the extent and in the manner
hereinafter set forth, (ii) except as provided in Section 2.2 hereof, no
payments or other distributions whatsoever in respect of any part of the
Subordinated Debt shall be made nor shall any property or assets of the
Issuer be applied to the purchase or other acquisition or retirement of any
part of the Subordinated Debt, and (iii) each of the Subordinated Lenders
agrees that it will not ask, demand, xxx for, take or receive from or for
the account of the Issuer (whether directly or indirectly), by set-off or
in any other manner, the Subordinated Debt, or any security therefor,
except with the prior written consent of each of the Secured Parties.
2.2 Notwithstanding the restrictions set forth in Section 2.1 above, but
without limitation to the rights of the Secured Parties under the terms of
the Financing Documents, until the final maturity date of the Senior
Secured Obligations, the Issuer may make repayments of principal of, other
prepayments of principal of, and payments of interest on, and other amounts
owing in respect of, the Subordinated Debt solely out of and to the extent
of any funds permitted to be paid to the Issuer out of the Distribution
Account in accordance with the provisions of the Depositary Agreement.
2.3 Payments of the Subordinated Debt not payable by reason of Section 2.2
above shall be deferred until the date on which such payment may be made in
accordance with the terms
Exhibit D
Page 2
hereof; provided that, in the event that the payment of the Subordinated
Debt is so deferred or the conditions to payment have not been satisfied in
accordance with the terms hereof, such delay in payment shall not
constitute a default in respect of the Subordinated Debt.
Section 3. No Payment in Certain Circumstances. Until the final
maturity date of the Senior Secured Obligations, and without limitation to the
rights of the Secured Parties under the terms of the Financing Documents:
3.1 upon any distribution or application of the assets of the Issuer in
connection with any liquidation, dissolution or other proceeding for the
winding up of the Issuer (whether partial or complete) or any proceeding
for insolvency or bankruptcy (whether voluntary or involuntary) or any
receivership, reorganization or other similar case or proceeding in
connection therewith, or any assignment for the benefit of creditors or
arrangement with creditors, whether or not pursuant to the insolvency,
bankruptcy or similar laws of any jurisdiction, or the sale of all or
substantially all of the assets of the Issuer or any other marshalling of
assets and liabilities of the Issuer:
3.1.1 the Senior Secured Obligations shall first be irrevocably and
indefeasibly paid in full to the Secured Parties before any of the
Subordinated Lenders shall be entitled to receive any payment on
account of the Subordinated Debt or any other interests in the Issuer
arising from the Subordinated Debt whether in cash, securities or
other assets; and
3.1.2 any payment or distribution of assets of the Issuer of any kind or
character in respect of the Subordinated Debt to which any of the
Subordinated Lenders would be entitled if the Subordinated Debt were
not subordinated pursuant to the terms hereof shall be made by the
trustee, liquidator or agent or other Person making such payment or
distribution, directly to the Secured Parties until the Senior Secured
Obligations are irrevocably and indefeasibly paid in full and each of
the Subordinated Lenders irrevocably authorizes and empowers the
Collateral Agent, acting for and on behalf of the Secured Parties, to
receive and collect on its behalf any and all such payments or
distributions;
3.2 without limitation to the foregoing, in the event any of the Distribution
Conditions (as defined in the Depositary Agreement) are not satisfied, then
no payment of principal, interest or other amounts owing shall be made by
the Issuer on or in respect of the Subordinated Debt, and each Subordinated
Lender agrees that it will not ask, demand, xxx for, take or receive from
or for the account of the Issuer (whether directly or indirectly), by
set-off or in any other manner, or retain payment (in whole or in part) of,
the Subordinated Debt, or any security therefor, until payments are
permitted to be made out of the Distribution Account in accordance with the
provisions of the Depositary Agreement;
3.3 if, for any reason whatsoever and whether pursuant to a bankruptcy,
liquidation or similar proceeding or otherwise, the Issuer shall make or
any of the Subordinated Lenders shall receive any payment or distribution
of any kind or character, whether in
Exhibit D
Page 3
cash, securities or other property, on account or in respect of the
Subordinated Debt in contravention of any of the terms set forth herein,
such Subordinated Lender shall hold any such payment or distribution in
trust for the benefit of the Secured Parties, promptly notify the
Collateral Agent of the receipt of such payment or distribution and
promptly pay over or deliver such distribution or payment to the Collateral
Agent, or to any other Person nominated by the Collateral Agent, to hold
for the account of the Secured Parties. In the event of failure of any
Subordinated Lender to make any such endorsement or assignment, the
Collateral Agent is irrevocably authorized by the Subordinated Lenders to
make the same; provided, however, that nothing in this sentence shall be
deemed to restrict any rights of the Secured Parties to enforce in any
manner provided under applicable law the obligation of a Subordinated
Lender to make any such endorsement or assignment; and
3.4 notwithstanding any provision to the contrary herein or in any other
Financing Document, no payment or delivery shall be made to the
Subordinated Lenders of securities or other Senior Secured Obligations
which are issued upon any merger, consolidation, sale, lease, transfer or
other disposal by any Person succeeding to the Issuer or acquiring the
Issuer's property and assets, unless such securities or Senior Secured
Obligations are pledged in favor of the Secured Parties and subordinate and
junior at least to the extent provided herein to the irrevocable and
indefeasible payment in full in cash of all Senior Secured Obligations and
to the payment of any stock or Senior Secured Obligations which are issued
in exchange or substitution for any such Senior Secured Obligations.
Section 4. Authorizations to Collateral Agent. Until the final
maturity date of the Senior Secured Obligations, and without limitation to the
rights of the Secured Parties under the terms of the Financing Documents, each
Subordinated Lender (i) irrevocably authorizes and empowers (without imposing
any obligation on) the Collateral Agent to claim, enforce, demand, xxx for,
collect and receive all payments and distributions on or in respect of the
Subordinated Debt which are required to be paid or delivered to any Secured
Party, as provided herein, and to file and prove all claims therefor, give
receipts and take all such other action, in the name of such Subordinated Lender
or otherwise, necessary or appropriate for the enforcement of these
subordination provisions, (ii) irrevocably authorizes and empowers (without
imposing any obligation on) the Collateral Agent to vote the Subordinated Debt
in favor of or in opposition to any matter which may come before any meeting of
creditors of the Issuer generally or in connection with, or in anticipation of,
any insolvency or bankruptcy case or proceeding, or any proceeding under any
laws relating to the relief of debtors, readjustment of indebtedness,
arrangements, reorganizations, compositions or extensions relative to the
Issuer, and (iii) agrees to execute and deliver to the Collateral Agent all such
further instruments confirming the above authorization, and all such powers of
attorney, proofs of claim, assignments of claim and other instruments, and to
take all such other action, as may be necessary or as may be requested by any
Secured Party in order to enable the Collateral Agent to accomplish the
foregoing.
Exhibit D
Page 4
Section 5. Non-Impairment. None of the Senior Secured Obligations of
the Issuer shall be impaired by the Secured Parties:
5.1 agreeing with the Issuer, any Subordinated Lender or any other Person as to
any amendment, variation, assignment, novation, extension or departure
(however substantial or material) of, to or from any Transaction Document
(including changing the manner, place or terms of payment of or extending
the time of payment of, or renewing or altering, the Senior Secured
Obligations, or otherwise amending or supplementing in any manner the
Senior Secured Obligations or any instrument evidencing the same or any
agreement under which the Senior Secured Obligations are outstanding, or
any Financing Document) so that any such amendment, variation, assignment,
novation or departure shall, whatever its nature, be binding upon the
Subordinated Lenders in all circumstances;
5.2 releasing, granting any time, any indulgence or any waiver of any kind to,
or composition with, the Issuer, any Subordinated Lender or any other
Person (including, without limitation, the waiver of any preconditions for
drawing under, or of any breach of, the Financing Documents or the exercise
or the failure to exercise any rights against the Issuer and any other
Person), or entering into any transaction or arrangements whatsoever with
or in relation to the Issuer, any Subordinated Lender and/or any other
Person;
5.3 taking, accepting, varying, dealing with, exchanging, renewing, enforcing,
failing to enforce, take up or perfect, abstaining from enforcing,
surrendering or releasing any security, right of recourse, set-off or
combination or other right, remedy or interest held by the Secured Parties
in connection with the Senior Secured Obligations or any part thereof, or
acting in relation to the Transaction Documents in such manner as it thinks
fit;
5.4 failing to present or observe any formality or other requirement in respect
of any instrument or any failure to realize the full value of any security;
5.5 claiming, proving for, accepting or transferring any payment in respect of
the Senior Secured Obligations in any composition by, or winding up of, the
Issuer, any Subordinated Lender and/or any other Person or abstaining from
so claiming, proving for, accepting or transferring; or
5.6 actually or purportedly assigning all or any portion of the Senior Secured
Obligations to any other Person.
To the fullest extent permitted by applicable law, no change of law or
circumstances shall release or diminish any of the Subordinated Lender's
liabilities, agreements or duties hereunder, affect the provisions set forth
herein in any way, or afford the Subordinated Lenders any recourse against any
of the Secured Parties.
Exhibit D
Page 5
Section 6. Benefit of Subordination Provisions. These subordination
provisions are intended solely to define the relative rights of the Secured
Parties, the Subordinated Lenders, and their respective successors and permitted
assigns.
Section 7. Subordination of Liens. Without limitation of any other
provisions of this Exhibit D, the Issuer shall not create or suffer to exist any
Lien on any of its Property benefiting the Subordinated Debt. If in
contravention of this Section 7, any such Liens shall now or hereafter secure or
benefit the Subordinated Debt, whether arising by statute, in law or equity or
by contract, then, without limiting any of the Secured Parties' rights in
respect of such breach, such Lien shall and is hereby expressly subordinated and
made secondary and inferior to the Liens now or hereafter securing or benefiting
the Senior Secured Obligations.
Section 8. Reinstatement. If any payment to any of the Secured Parties
by the Issuer or any other Person in respect of any of the Senior Secured
Obligations is held to constitute a preference or a voidable transfer under
applicable law, or if for any other reason any Secured Party is required to
refund such payment to the Issuer or to such Person or to pay the amount thereof
to any other Person, such payment to such Secured Party shall not constitute a
release of any of the Subordinated Lenders from any of their liability
hereunder, and each Subordinated Lender agrees and acknowledges that the
provisions set forth herein shall continue to be effective or shall be
reinstated, as the case may be, to the extent of any such payment or payments.
Section 9. Restrictions on Transfers. None of the Subordinated Lenders
may transfer (by sale, novation or otherwise) any of its rights or obligations
under the Subordinated Debt and under these subordination provisions unless (i)
such transfer is in connection with a transfer of all or a portion of its
respective interest in the Subordinated Debt as expressly permitted under the
Financing Documents and (ii) the transferee of such interest first agrees in
writing to be bound by the terms of this Exhibit D applicable to the transferor
of such interest and executes an instrument to that effect.
Section 10. Affirmative Covenants of the Subordinated Lenders. Each of
the Subordinated Lenders shall:
10.1 until the Senior Secured Obligations have been paid in full, promptly
deliver to the Collateral Agent copies of each amendment or modification to
any agreement relating to the Subordinated Debt agreed to which such
Subordinated Lender is a party;
10.2 until the Senior Secured Obligations have been paid in full, cause to be
clearly inserted in any instrument which at any time evidences any part of
the Subordinated Debt owing to such Subordinated Lender a statement to the
effect that the payment thereof is subordinated in accordance with the
terms of this Exhibit D; and
10.3 cause its right to receive any payment in respect of the Subordinated Debt
to be (and, upon the creation of the Subordinated Obligation, the
Subordinated Lender acknowledges and agrees that such Subordinated
Obligation is and shall be) subject to the Liens created by the Security
Documents and, if required by applicable law, cause any agreement or
instrument evidencing such right to be registered or filed with the
Exhibit D
Page 6
appropriate Governmental Authorities in order to perfect such Liens created
by the Security Documents and cause any instrument which at any time
evidences any part of the Subordinated Debt owing to such Subordinated
Lender and any proceeds deriving therefrom to be pledged in favor of the
Secured Parties and an original of such instrument shall be delivered to
the order of the Collateral Agent with appropriate endorsements thereto
executed in blank; and
10.4 at its own cost, file all documents or instruments necessary or advisable
and do all things as any Secured Party may reasonably request in order to
carry out more effectively the intent and purpose of these subordination
provisions.
Section 11. Negative Covenants of the Subordinated Lenders. Until the
Senior Secured Obligations have been paid in full, each of the Subordinated
Lenders shall not:
11.1 create, agree to create or permit to exist, any Lien (howsoever ranking in
point of priority) of any nature whatsoever in, over or affecting the
Subordinated Debt owing to such Subordinated Lender, other than pursuant to
the Security Documents and those contemplated hereunder;
11.2 without the prior written consent of the each of the Secured Parties, xxx
for payment of, or accelerate the maturity of, or initiate any proceedings
or take any other actions to enforce any of the Subordinated Debt owing to
such Subordinated Lender;
11.3 whether by set-off, counter-claim or otherwise, reduce any amount owing by
such Subordinated Lender to the Issuer by an amount payable by the Issuer
or any Affiliate or other Person to such Subordinated Lender in respect of
the Subordinated Debt;
11.4 initiate, support, permit or join any creditor in bringing any proceeding
against the Issuer under any bankruptcy, insolvency, reorganization,
receivership or similar law of any jurisdiction (to recover all or any part
of the Subordinated Debt or any other liability owed to such Subordinated
Lender), except at the written request of the Collateral Agent;
11.5 permit to subsist or receive any guarantee or other assurance against loss
in respect of all or any part of the Subordinated Debt owing to such
Subordinated Lender (other than those guarantees and/or assurances against
loss that a Subordinated Lender would normally acquire in the ordinary
course of business, based upon its exercise of prudent business judgment,
including, but not limited to political risk insurance, currency and
interest rate hedging agreements, and other similar instruments; provided
that such guarantees and/or assurances do not give rise to any direct or
indirect recourse against the Issuer by the providers of such guarantees
and/or assurances) or accept, or otherwise take, any collateral security
for such Subordinated Debt or commence enforcement proceedings with respect
to, or against, any collateral security for such Subordinated Debt;
Exhibit D
Page 7
11.6 subordinate all or any part of the Subordinated Debt owing to such
Subordinated Lender or the proceeds thereof to any sums owing by the Issuer
to any Persons other than the Secured Parties; or
11.7 take or omit to take any action whereby the subordination hereunder of all
or any part of the Subordinated Debt may be impaired.
Section 12. Security Interest. (a) Each Subordinated Lender hereby
acknowledges and agrees that, as a condition to the incurrence of any
Subordinated Debt, such Subordinated Lender shall have delivered to the
Collateral Agent a Subordinated Debt Pledge Agreement in respect of such
Subordinated Debt, and each Subordinated Lender hereby acknowledges that it has
assigned and granted to the Collateral Agent, for the benefit of the Secured
Parties, a first priority Lien and security interest on such Subordinated Debt
and any subordinated note evidencing such Subordinated Debt as collateral
security for the payment and performance when due of the Senior Secured
Obligations.
(b) Each Subordinated Lender hereby acknowledges and agrees that upon the
conversion of any Subordinated Debt into equity pursuant to Section 13 below,
such Subordinated Lender will either (i) confirm in writing to the Collateral
Agent that such equity interests are subject to a first priority Lien on and
security interest in favor of the Collateral Agent, for the benefit of the
Secured Parties, pursuant to an existing Pledge Agreement previously executed by
such Subordinated Lender or (ii) provide to the Collateral Agent a pledge
agreement in substantially the same form as the Pledge Agreements pursuant to
which such Subordinated Lender will grant a first priority Lien on and security
interest in such equity interests in favor of the Collateral Agent, for the
benefit of the Secured Parties.
Section 13. Conversion of Subordinated Debt. Upon the occurrence and
during the continuance of an Event of Default, each of the Subordinated Lenders
and the Issuer shall, at the request of the Collateral Agent, immediately cause
all Subordinated Debt then outstanding to be converted into equity of the
Issuer.
Section 14. Waiver of Subrogation.
14.1 Notwithstanding anything to the contrary herein or in any other Financing
Document, until the final maturity date of the Senior Secured Obligations
each of the Subordinated Lenders irrevocably waives any claim or other
rights which it may now have or hereafter acquire against the Issuer that
arise from the existence or performance of its Senior Secured Obligations
hereunder including any and all rights of subrogation, reimbursement,
exoneration, contribution, indemnification, any right to participate in any
claim or remedy of the Secured Parties against the Issuer, or any security
which the Secured Parties may now have or hereafter acquire, by any payment
made hereunder or otherwise, including the right to take or receive from
the Issuer, directly or indirectly, in cash or other property or by set-off
or in any other manner, payment or security on account of such claim or
other rights.
14.2 For the purposes of such waiver of subrogation, any payments or
distributions to the Secured Parties of any cash, property or securities to
which the Subordinated Lenders
Exhibit D
Page 8
would be entitled except for these provisions shall, as between the Issuer
and the Subordinated Lenders and their respective other creditors, be
deemed to be a payment by the Issuer to or on account of the Senior Secured
Obligations.
Section 15. Exercise of Powers.
15.1 The Secured Parties shall be entitled to exercise their rights and powers
under these subordination provisions in such a manner and at such times as
the Secured Parties in their absolute discretion may determine. None of the
Secured Parties shall be liable for any losses arising in connection with
the exercise of or failure to exercise any of its rights, powers and
discretions hereunder.
15.2 The Subordinated Lenders alone shall be responsible for their contracts,
engagements, acts, omissions, defaults and losses and for liabilities
incurred by them.
EXHIBIT E
FORM OF DEED OF TRUST
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
MILBANK, TWEED, XXXXXX & XxXXXX
000 Xxxxx Xxxxxxxx Xxxxxx
Thirtieth Floor
Los Angeles, California 90017
Attn: Xxxxxxx X. Xxxx, Esq.
DEED OF TRUST, ASSIGNMENT OF RENTS, SECURITY
AGREEMENT, AND FIXTURE FILING
THIS DEED OF TRUST, ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE
FILING (this "DEED OF TRUST") is made as of ___________________________, 200_,
made by _______________________, a _____________________("TRUSTOR"), whose
address is ____________________________, to __________________________ Title
Company, a _____________________ corporation ("TRUSTEE"), whose address is
____________________________________, for the benefit of _____________________,
a __________________________, whose address is _________________________, in its
capacity as __________________ [agent] under the ______________________ (as
defined herein), its successors and assigns (collectively, "BENEFICIARY").
ARTICLE I.
GRANTS AND OBLIGATIONS SECURED
X. XXXXX
1.1. TRUSTOR HEREBY GRANTS, TRANSFERS, CONVEYS AND ASSIGNS TO TRUSTEE,
IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, under
and subject to the terms and conditions hereinafter set forth:
(i) all right, title and interest of Trustor, now owned or hereafter
acquired, in and to all of those buildings, structures, fixtures, machinery
and other improvements constituting that certain geothermal electrical
generating facility and steam gathering system (including, without
limitation, foundations, turbine decks, sumps, trenches, paving, control
building, structural steel framing, parking covers, HVAC, electrical,
septic and plumbing installations, pipelines, cooling tower and turbine
generators) located on that certain real property in the County of
_________________________, State of California, all as more particularly
described in Exhibit A attached hereto and by this reference incorporated
herein (all such real property described in Exhibit A is collectively
referred to herein as the "PROPERTY");
(ii) TOGETHER WITH, all right, title and interest of Trustor, now
owned or hereafter acquired, in and to those certain leasehold estates and
leases described in Exhibit B attached hereto and by this reference
incorporated herein (each lease described therein a "LEASE," and
collectively the "LEASES"), covering that certain real property located in
the County of ____________________, State of California and more
particularly described in Exhibit B attached hereto and by this reference
incorporated herein (all such real property described in Exhibit B is
collectively referred to herein as the "LEASED LAND," and with the Property
is collectively referred to herein as the "PREMISES");
(iii) TOGETHER WITH, to the extent not comprising a part of the
Property described above, all of Trustor's right, title and interest in any
and all buildings and improvements now or hereafter erected on the Premises
or on the easements described in subparagraph (vi) of this granting clause,
including but not limited to an __________ (___) megawatt geothermal
electric power plant facility comprised of _____________ (___)
[_____________] turbines (each rated at _____ megawatt) and ____________
(___) [spare rotor and diaphragm], and all appurtenant structures and
equipment, including the related steamfield development improvements and
equipment comprised of drill pads, roads, geothermal resource gathering and
disposal systems, interconnection equipment, all surface steam gathering
systems, brine disposal systems, power transmission facilities and lines,
substations, interconnection facilities and other facilities and equipment
used to generate, sell and deliver power and all other machinery and
equipment and other articles attached to said facilities and improvements
(the "IMPROVEMENTS");
(iv) TOGETHER WITH all rents, earnings issues, profits, royalties,
income, accounts receivable, revenues, deposits, security deposits,
receipts and other benefits (collectively, the "RENTS") derived or
generated from the use and operation of the Premises, Improvements and the
Collateral (as defined herein), including any of the Leases, or to which
Trustor may be entitled, whether now due, past due or to become due or from
any lease, sublease, license, franchise or concession or other agreement
now or hereafter affecting all or any portion of the Premises or the
Improvements or the use, operation or occupancy thereof, subject to the
terms and provisions of Article III hereof;
(v) TOGETHER WITH all interests, estates or other claims, both in law
and in equity, which Trustor now has or may hereafter acquire in the
Premises or the Improvements;
(vi) TOGETHER WITH all right, title and interest now or hereafter
appertaining, belonging to or acquired by Trustor in and to any easements,
rights-of-way, rights, licenses, profits, and privileges used in connection
therewith or as a means of access thereto, including without limitation
those easements covering that certain real property located in the County
of __________________________, State of California, which easements and
real property are more particularly described in Exhibit C attached hereto
and by this reference incorporated herein, and including, without limiting
the generality of the foregoing, all rights pursuant to any trackage
agreement and all rights to the nonexclusive use of common drive entries,
any after acquired title and reversion in or to
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each and every part of all streets, roads, highways and alleys adjacent to
and adjoining the same; and all tenements, hereditaments and appurtenances
thereof and thereto, and all water and water rights (whether riparian,
appropriative or otherwise, and whether or not appurtenant), and shares of
stock evidencing the same;
(vii) TOGETHER WITH all leasehold estates, rights, titles and
interests of Trustor in, to and under all leases, subleases, licenses,
franchises and other agreements covering the Premises, the Improvements or
any portion thereof now or hereafter existing or entered into, and all
rights, titles and interests of Trustor thereunder, including, without
limitation, all cash or security deposits, advance rentals, and deposits or
payments of similar nature;
(viii) TOGETHER WITH all right, title and interest now owned or
hereafter acquired by Trustor in and to any greater estate in the Premises
or the Improvements;
(ix) TOGETHER WITH all the estate, interest, right, title, other claim
or demand, both in law and in equity, including claims or demands with
respect to the proceeds of insurance in effect with respect thereto, which
Trustor now has or may hereafter acquire in the Premises or the
Improvements, and any and all awards made for the taking by eminent domain,
or by any proceeding of purchase in lieu thereof, of any other component of
the whole or any part of the Trust Estate (as hereinafter defined),
including, without limitation, any awards resulting from a change of grade
of streets and awards for severance damages;
(x) TOGETHER WITH all right, title and interest now owned or hereafter
acquired by Trustor in and to all articles of personal property and any
additions to, substitutions for, changes in or replacements of the whole or
any part thereof, including, without limitation, pipes, furnaces, boilers,
generators, conveyors, drums, fire sprinklers and alarm systems, and air
conditioning, heating, refrigerating, electronic monitoring, trash and
garbage removal and maintenance equipment, office equipment, appliances,
and all other and additional personal property which may now or hereafter
be used or obtained in connection with the Premises or the Improvements,
the specific enumerations herein not excluding the general, now or at any
time hereafter affixed to, attached to, placed upon, used or useful in any
way in connection with the use, enjoyment, occupancy or operation of the
Premises or the Improvements or any portion thereof and owned by Trustor or
in which Trustor now has or hereafter acquires an interest, and all
building materials, supplies, tools and equipment now or hereafter
delivered to the Premises and intended to be installed or placed in or
about the Improvements;
(xi) TOGETHER WITH all general intangibles relating to design,
development, operation, management and use of the Premises and construction
of the Improvements, including, but not limited to, (a) all permits,
licenses, authorizations, variances, land use entitlements, approvals and
consents issued or obtained in connection with the construction of the
Improvements, (b) all permits, licenses, approvals, consents,
authorizations, franchises and agreements issued or obtained in connection
with the use,
-3-
occupancy or operation of the Premises or the Improvements, (c) all rights
as a declarant (or its equivalent) under any covenants, conditions and
restrictions or other matters of record affecting the Premises or the
Improvements, (d) all materials prepared for filing or filed with any
governmental agency, (e) all rights under any contract in connection with
the development, design, use, operation, management and construction of the
Premises or the Improvements and (f) all books and records prepared and
kept in connection with the acquisition, construction, operation and
occupancy of the Premises, the Improvements and any other component of the
Trust Estate;
(XII) TOGETHER WITH all construction, service, engineering,
consulting, leasing, architectural and other similar contracts of any
nature (including, without limitation, those of any general contractors,
subcontractors and materialmen), as such may be modified, amended or
supplemented from time to time, concerning the design, construction,
management, operation, occupancy, use, and/or disposition of any other
component of any portion of or all of the Trust Estate;
(XIII) TOGETHER WITH all architectural drawings, plans,
specifications, soil tests and reports, feasibility studies, appraisals,
engineering reports and similar materials relating to any portion or all of
the Premises and the Improvements;
(XIV) TOGETHER WITH all payment and performance bonds or guarantees
and any and all modifications and extensions thereof relating to the
Premises and the Improvements;
(XV) TOGETHER WITH all reserves, deferred payments, deposits, refunds,
cost savings, letters of credit and payments of any kind relating to the
construction, design, development, operation, occupancy, use and
disposition of any other component of all or any portion of the Trust
Estate, including, without limitation, any property tax rebates now owing
or hereafter payable to Trustor;
(XVI) TOGETHER WITH any commitment by any lender to extend permanent
or additional construction financing to Trustor relating to any other
component of the Trust Estate;
(XVII) TOGETHER WITH all proceeds and claims arising on account of any
damage to or taking of any other component of the Trust Estate or any part
thereof, and all causes of action and recoveries for any loss or diminution
in the value of any other component of the Trust Estate;
(XVIII) TOGETHER WITH all policies of, and proceeds resulting from,
insurance relating to any other component of the Trust Estate or any of the
above collateral, and any and all riders, amendments, renewals, supplements
or extensions thereof, and all proceeds thereof;
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(XIX) TOGETHER WITH all deposits made with or other security given to
utility companies by Trustor with respect to the Premises and/or the
Improvements, and all advance payments of insurance premiums made by
Trustor with respect thereto and claims or demands relating to insurance
and all deposit accounts wherever located;
(XX) TOGETHER WITH all shares of stock or other evidence of ownership
of any other component of any part of the Trust Estate that is owned by
Trustor in common with others, including all water stock relating to the
Premises or the Improvements, if any, and all documents or rights of
membership in any owners' or members' association or similar group having
responsibility for managing or operating any part of the Premises or the
Improvements;
(XXI) TOGETHER WITH all proceeds, whether cash, promissory notes,
contract rights or otherwise, of the sale or other disposition of all or
any part of the estate of Trustor upon the Premises or the Improvements now
or hereafter existing thereon;
(XXII) TOGETHER WITH all sales contracts, escrow agreements and
broker's agreements concerning the sale of any other component of any or
all of the Trust Estate;
(XXIII) TOGETHER WITH any and all monies and other property, real or
personal, which may from time to time be subjected to the lien hereof by
Trustor or by anyone on its behalf or with its consent, or which may come
into the possession or be subject to the control of Trustee or Beneficiary
pursuant to this Deed of Trust or any Project Document (as defined in the
Indenture), including, without limitation, any protective advances under
this Deed of Trust;
(XXIV) TOGETHER WITH all Goods, Accounts, Documents, Instruments,
Money, Chattel Paper and General Intangibles, as those terms are defined in
the Commercial Code from time to time in effect in the State of California
("COMMERCIAL CODE") (collectively with the property described in
subsections (x) through (xxiii), the "COLLATERAL").
The security interest granted by Section 1.1 with respect to the
property described in subsection (iv) above is intended by Trustor to be
subordinate to the provisions of Article III hereof and shall not take priority
unless and until the absolute assignment granted to Beneficiary by Trustor in
Article III is for any reason deemed to be ineffective.
1.2. MINERAL RIGHTS. Trustor hereby assigns and transfers to
Beneficiary all damages, royalties and revenue of every kind, nature and
description whatsoever that Trustor may be entitled to receive from any person
or entity owning or having or hereafter acquiring a right to the oil, gas or
mineral rights and reservations of the Premises, with the right in Beneficiary
to receive and receipt therefor, and apply the same to the indebtedness secured
hereby either before or after any default hereunder, and Beneficiary may demand,
xxx for and recover any such payments but shall not be required to do so.
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The entire estate, property and interest hereby conveyed to Trustee in
Sections 1.1 and 1.2 of this Article I(A) may hereafter be collective referred
to as the "TRUST ESTATE".
1.3. FIXTURE FILING. The personal property in which beneficiary has a
security interest includes goods which are or shall become fixtures on the
Premises. This Deed of Trust is intended to serve as a fixture filing pursuant
to the terms of Sections 9334, 9502 and 9604 of the California Commercial Code
__________________ Commercial Code. This filing is to be recorded in the real
estate records of the county in which the Premises is located. This filing
remains in effect as a fixture filing until this Deed of Trust is released or
satisfied of record or its effectiveness otherwise terminates as to the Trust
Estate. In that regard, the following information is provided:
Name of Debtor:
--------------------------
Address of Debtor: See Section 5.7 hereof.
Name of Secured Party:
------------------------
Address of Secured Party: See Section 5.7 hereof.
Trustor is the owner of a record interest in the real estate
concerned. Trustor warrants and agrees that there is no financing statement
covering the foregoing Collateral, the Premises, the Improvements, the Trust
Estate, or any part thereof, on file in any public office, except as disclosed
by Trustor to Beneficiary or as filed in connection with the transactions
contemplated by the Indenture.
B. OBLIGATIONS SECURED
1.4. FOR THE PURPOSE OF SECURING, IN SUCH ORDER OF PRIORITY AS
BENEFICIARY MAY DETERMINE (COLLECTIVELY, THE "OBLIGATIONS"):
(i) payment of the aggregate outstanding principal amount of the Loans
(as defined in the Indenture) plus accrued interest thereon, created by
that certain Indenture dated as of even date herewith between
Trustor, [_________________] as indenture trustee,
[____________] party(ies) thereto and Beneficiary (the "INDENTURE")
and evidenced by that certain Promissory Note (the "NOTE") of even date
herewith executed by Trustor;
(ii) payment of all other amounts from time to time payable under the
Basic Documents (as defined in the Indenture) plus accrued interest
thereon;
(iii) payment of all other amounts from time to time payable by
Trustor, to any Lender in connection with the Interest Rate Protection
Agreements contemplated by Section 8.15 of the Indenture and entered into
with parties that are Lenders (or affiliates of Lenders);
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(iv) performance of every obligation, covenant or agreement of Trustor
contained herein and all supplements, amendments and modifications thereto
and all extensions and renewals thereof; and
(v) performance of every obligation, covenant and agreement of Trustor
contained in any Loan Document or any agreement now or hereafter executed
by Trustor which recites that the obligations thereunder are secured by
this Deed of Trust.
TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR HEREBY
COVENANTS AND AGREES AS FOLLOWS:
ARTICLE II.
COVENANTS AND AGREEMENTS OF TRUSTOR
2.1. ASSIGNMENT OF POLICIES UPON FORECLOSURE. In any event of
foreclosure of this Deed of Trust or other transfer of title or assignment of
the Trust Estate in extinguishment, in whole or in part, of the debt secured
hereby, all right, title and interest of Trustor in and to all policies of
insurance required by the Indenture shall inure to the benefit of and pass to
the successor in interest to Trustor or the purchaser or grantee of the Trust
Estate.
2.2. WAIVER OF OFFSET. All sums payable by Trustor pursuant to this
Deed of Trust shall be paid without notice, demand, counterclaim, setoff,
deduction or defense and without abatement, suspension, deferment, diminution or
reduction, and the obligations and liabilities of Trustor hereunder shall in no
way be released, discharged or otherwise affected (except as expressly provided
herein) by reason of: (a) any damage to or destruction of or any condemnation or
similar taking of the Trust Estate or any part thereof; (b) any restriction or
prevention of or interference by any third party with any use of the Trust
Estate or any part thereof; (c) any title defect or encumbrance or any eviction
from the Premises or the Improvements or any part thereof by title paramount or
otherwise; (d) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating to
Beneficiary or any guarantor of any Obligations, or any action taken with
respect to this Deed of Trust by any trustee or receiver of Beneficiary, or by
any court, in any such proceeding; (e) any claim which Trustor has or might have
against Beneficiary; (f) any default or failure on the part of Beneficiary to
perform or comply with any of the terms hereof or of any other agreement with
Trustor; or (g) any other occurrence whatsoever, whether similar or dissimilar
to the foregoing; whether or not Trustor shall have notice or knowledge of any
of the foregoing. Except as expressly provided herein, Trustor waives all rights
now or hereafter conferred by statute or otherwise to any abatement, suspension,
deferment, diminution or reduction of any sum secured hereby and payable by
Trustor.
2.3. ACTIONS BY TRUSTEE OR BENEFICIARY TO PRESERVE TRUST ESTATE. If
Trustor fails to make any payment or to do any act as and in the manner provided
in any of the Project Documents, Beneficiary and/or Trustee, each in its own
discretion, without obligation so to do, without releasing Trustor from any
obligation, and without notice to or demand upon Trustor,
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may make or do the same in such manner and to such extent as either may deem
necessary to protect the security hereof. In connection therewith (without
limiting their general powers, whether conferred herein, in another Project
Document or by law), Beneficiary and Trustee shall have and are hereby given the
right, but not the obligation, (a) to enter upon and take possession of the
Trust Estate; (b) to make additions, alterations, repairs and improvements to
the Trust Estate which they or either of them may consider necessary or proper
to keep the Trust Estate in good condition and repair; (c) to appear and
participate in any action or proceeding affecting or which may affect the
security hereof or the rights or powers of Beneficiary or Trustee; (d) to pay,
purchase, contest or compromise any encumbrance, claim, charge, lien or debt
which in the judgment of either may affect or appears to affect the security of
this Deed of Trust or be prior or superior hereto; and (e) in exercising such
powers, to pay necessary expenses, including attorneys' fees and costs or other
necessary or desirable consultants. Trustor shall, immediately upon demand
therefor by Beneficiary and Trustee or either of them, pay to Beneficiary and
Trustee an amount equal to all respective costs and expenses incurred by such
party in connection with the exercise of the foregoing rights, including,
without limitation, costs of evidence of title, court costs, appraisals, surveys
and receiver's, trustee's and attorneys' fees, together with interest thereon
from the date of such expenditures at the Post-Default Rate.
2.4. FURTHER ASSURANCES. Trustor agrees to execute such documents and
take such action as Beneficiary shall determine to be necessary or desirable to
further evidence, perfect or continue the perfection and/or the priority of the
lien and security interest granted by Trustor herein.
2.5. EMINENT DOMAIN. In the event that any proceeding or action be
commenced for the taking of the Trust Estate, or any part thereof or interest
therein, for public or quasi-public use under the power of eminent domain,
condemnation or otherwise, or if the same be taken or damaged by reason of any
public improvement or condemnation proceeding, or in any other manner
(collectively, a "CONDEMNATION"), or should Trustor receive any notice or other
information regarding such proceeding, action, taking or damage, Trustor shall
give prompt written notice thereof to Beneficiary. Beneficiary shall be entitled
to consent to any compromise or settlement in connection with such taking or
damage. All compensation, awards, damages, rights of action and proceeds awarded
to Trustor by reason of any such taking or damage (the "Condemnation Proceeds")
are hereby absolutely and unconditionally assigned to Beneficiary and Trustor
agrees to execute such further assignments of the CONDEMNATION PROCEEDS as
Beneficiary or Trustee may require. All such Condemnation Proceeds shall be
applied as provided for in the Indenture [CONFIRM THAT INDENTURE WILL GOVERN
CONDEMNATION].
2.6. ADDITIONAL SECURITY. No other security now existing, or hereafter
taken, to secure the Obligations shall be impaired or affected by the execution
of this Deed of Trust; and all additional security shall be taken, considered
and held as cumulative. The taking of additional security, execution of partial
releases of the security, or any extension of the time of payment of the
indebtedness shall not diminish the force, effect or lien of this Deed of Trust
and shall not affect or impair the liability of any maker, surety or endorser
for the payment of said indebtedness. In the event Beneficiary at any time holds
additional security for any of the
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Obligations, it may enforce the sale thereof or otherwise realize upon the same,
at its option, either before, concurrently, or after a sale is made hereunder.
2.7. ASSIGNMENT OF CONTRACTS. In addition to any other grant, transfer
or assignment effectuated hereby, without in any manner limiting the generality
of the grants given above, Trustor shall assign to Beneficiary, as security for
the indebtedness secured hereby, Trustor's interest in all agreements,
contracts, leases, licenses and permits affecting the Premises and Improvements
in any manner whatsoever, such assignments to be made, if so requested by
Beneficiary, by instruments in form satisfactory to Beneficiary; but no such
assignment shall be construed as a consent by Beneficiary to any agreement,
contract, license or permit so assigned, or to impose upon Beneficiary any
obligations with respect thereto.
2.8. APPOINTMENT OF SUCCESSOR TRUSTEE. Beneficiary may, from time to
time, by a written instrument executed and acknowledged by Beneficiary, mailed
to Trustor and recorded in the County in which the Trust Estate is located and
by otherwise complying with the provisions of applicable law, substitute a
successor or successors to any Trustee named herein or acting hereunder; and
said successor shall, without conveyance from the Trustee predecessor, succeed
to all title, estate, rights, powers and duties of said predecessor.
2.9. TRUSTEE'S POWERS. At any time, or from time to time, without
liability therefor and without notice, upon written request of Beneficiary and
presentation of this Deed of Trust and the Note secured hereby for endorsement,
Trustee may (i) reconvey any part of said Trust Estate, (ii) consent in writing
to the making of any map or plat thereof, (iii) join in granting any easement
thereon, or (iv) join in any extension agreement or any agreement subordinating
the lien or charge hereof.
2.10. BENEFICIARY'S POWERS. Without affecting the liability of any
other person liable for the payment of any obligation herein mentioned, and
without affecting the lien or charge of this Deed of Trust upon any portion of
the Premises not then or theretofore released as security for the full amount of
all unpaid obligations, Beneficiary may, from time to time and without notice
(i) release any person so liable, (ii) extend the maturity or alter any of the
terms of any such obligation, (iii) grant other indulgences, (iv) release or
reconvey, or cause to be released or reconveyed at any time at Beneficiary's
option any parcel, portion or all of the Trust Estate, (v) take or release any
other or additional security for any obligation herein mentioned, or (vi) make
compositions or other arrangements with debtors in relation thereto.
2.11. TRADE NAMES. At the written request of Beneficiary, Trustor
shall execute a certificate in form satisfactory to Beneficiary listing the
trade-names or fictitious business names under which Trustor intends to operate
the Trust Estate or any business located thereon and representing and warranting
that Trustor does business under no other trade names or fictitious business
names. Trustor shall promptly notify Beneficiary in writing of any change in
said trade names or fictitious business names, and will, upon written request of
Beneficiary, execute any additional financing statements and other certificates
necessary to reflect the change in trade names or fictitious business names.
-9-
2.12. EASEMENT AND OTHER AGREEMENTS. Trustor shall faithfully perform
each and every obligation assumed under any reciprocal agreement, easement
agreement, operating agreement, parking agreement and/or other agreement
affecting the Premises or the Improvements or any portion thereof. All such
other agreements shall be satisfactory in form and substance to Beneficiary and,
if Beneficiary so requests, Trustor's rights and interests under any such other
agreement shall be assigned to Beneficiary. Failure by Trustor to perform any
obligation under any such agreement shall constitute a default hereunder if not
cured as and when provided.
2.13. LEASES. With respect to the Leases, Trustor hereby acknowledges
and agrees:
(a) That so long as this Deed of Trust is in effect, there shall be no
merger of any of the Leases (as used in this subsection (a), "LEASES" shall
refer to the Leases described on Exhibit B and any future leases entered
into by Trustor covering any of the Trust Estate) or any interest therein
nor of the estates created thereby with the fee estate in the Premises or
the Improvements or any portion thereof by reason of the fact that any of
the Leases or such interest therein or such estates may be held directly or
indirectly by or for the account of any person who shall hold the leasehold
or fee estate in the Premises or the Improvements or any portion thereof or
any interest of the lessor under any of the Leases. In case Trustor
acquires the fee title or any other estate, title or interest in the
Premises or the Improvements covered by any of the Leases, this Deed of
Trust shall attach to and cover and be a lien upon the fee title or such
other estate so acquired, and such fee title or other estate shall, without
further assignment, mortgage or conveyance, become and be subject to the
lien of and any such acquisition by Trustor and, on written request by
Beneficiary, Trustor shall cause to be executed and recorded all such other
and further assurances or other instruments in writing as may in the
reasonable opinion of Beneficiary be required to carry out the intent and
meaning hereof.
(b) That no surrender by Trustor, as lessee under any of the Leases,
to the lessor under any of the Leases, or any portion thereof or of any
interest therein, and no termination of any of the Leases by Trustor as
lessee thereunder, shall be valid or effective, and the Leases and the
terms of any assignment to Trustor as assignee thereunder may not be
amended, modified, changed, surrendered or cancelled, or subordinated to
any fee mortgage, to any lease, or to any other interest, either orally or
in writing without the prior written consent of Beneficiary so long as this
Deed of Trust is in effect.
(c) That if any of the Leases is terminated, in whole or in part, by
reason of default of Trustor thereunder, or by reason of the failure to
satisfy conditions thereunder, the satisfaction of which would have
resulted, either directly or indirectly, in the extension of the term of
such Lease, and if, pursuant to any provision of any of the Leases, or
otherwise, Beneficiary or its assignee shall acquire from the lessor
thereunder a new lease of the Premises of the Improvements, or of any part
of the Premises or the Improvements, Trustor shall have no right, title or
interest in or to such new lease or the leasehold estate
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created thereby unless and until Trustor cures all defaults hereunder and
under the Project Documents during the cure periods set forth herein or
therein or as allowed by California law applicable to foreclosures of real
property.
(d) Trustor acknowledges that, pursuant to Section 365 of the
Bankruptcy Reform Act of 1978 (hereinafter, as the same may be amended or
recodified from time to time, the "BANKRUPTCY ACT"), it is possible that a
trustee in bankruptcy of any lessor of the Leases (for the purposes of this
Section 2.13, a "LESSOR") or any Lessor as a debtor-in-possession could
reject the Leases, in which case Trustor, as lessee, would have the
election described in Section 365(h) of the Bankruptcy Act (which election,
as the same may be amended, revised or recodified from time to time, and
together with any comparable right under any other state or federal law
relating to bankruptcy, reorganization or other relief for debtors, whether
now or hereafter in effect, is in this Deed of Trust called the "ELECTION")
to treat the Leases as terminated by such rejection, or in the alternative,
to remain in possession for the balance of the term of the Leases, and any
renewal or extension thereof that is enforceable by Trustor as the lessee
under applicable non-bankruptcy law.
(e) Trustor covenants that it will not consent to or permit the
termination of the Leases by exercise of the Election or otherwise without
the prior written consent of Beneficiary, Trustor acknowledges that,
because the Leases are a primary part of Beneficiary's security for the
Obligations, Beneficiary does not anticipate that it would consent to the
termination of the Leases and shall not under any circumstances be obliged
to give such consent.
(f) To secure the covenant made in subsection (e) and as security for
the other Obligations, Trustor assigns the Election to Beneficiary. Trustor
acknowledges and agrees that the foregoing assignment of the Election is
one of the rights that Beneficiary may use at any time to protect and
preserve the other rights and interests of Beneficiary under this Deed of
Trust, because exercise of the Election in favor of terminating the Leases
would constitute waste hereunder.
(g) Trustor acknowledges and agrees that the Election is in the nature
of a remedy and is not a property interest that Trustor can separate from
the Leases. Therefore, Trustor agrees that exercise of the Election in
favor of preserving the right to possession under the Leases shall not be
deemed to constitute a taking or sale of the Collateral by the Beneficiary
and shall not entitle Trustor to any credit against the Obligations.
(h) Trustor acknowledges and agrees that, in the event the Election is
exercised by Beneficiary in favor of Trustor remaining in possession,
Trustor's resulting right to possession and use of (and Rents and profits
from) property under the Leases, as adjusted by the effect of Section 365
of the Bankruptcy Act, shall then be part of the Collateral and shall be
subject to the liens created by this Deed of Trust.
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ARTICLE III.
ASSIGNMENT OF RENTS, ISSUES AND PROFITS
3.1. ASSIGNMENT TO BENEFICIARY; LICENSE. Trustor hereby absolutely and
irrevocably grants, sells, assigns, transfers and sets over to Beneficiary all
of the Rents derived from any lease, now existing or hereafter created and
affecting all or any portion of the Trust Estate or the use or occupancy
thereof; together with all of Trustor's rights, titles and interests in any
leases, including the Leases, including all modifications, amendments,
extensions and renewals of any leases (whether heretofore or hereafter entered
into) and all rights and privileges incident thereto; together with all security
deposits, guaranties and other security now or hereafter held by Trustor as
security for the performance of the obligations of the tenants thereunder. This
assignment of rents is intended by Trustor and Beneficiary to create and shall
be construed to create an absolute assignment to Beneficiary of all of Trustor's
rights, titles and interests in the Rents and in any leases and shall not be
deemed to create a security interest therein for the payment of any indebtedness
or the performance of any obligations of Trustor under the Indenture. Trustor
irrevocably appoints Beneficiary its true and lawful attorney, at the option of
Beneficiary at any time, to demand, receive and enforce payment, to give
receipts, releases and satisfactions, and to xxx, either in the name of Trustor
or in the name of Beneficiary, for all such income, rents, issues, deposits,
profits and proceeds and apply the same to the indebtedness secured hereby.
Trustor and Beneficiary further agree that, during the term of this assignment,
the Rents shall not constitute property of Trustor (or of any estate of Trustor)
within the meaning of 11 U.S.C. Section 541, as amended from time to time. By
its acceptance of this assignment and so long as an Event of Default shall not
have occurred and be continuing under the Project Documents, Beneficiary hereby
grants to Trustor a revocable license to enforce the leases, to collect the
Rents, to apply the Rents to the payment of the costs and expenses incurred in
connection with the development, construction, operation, maintenance, repair
and restoration of the Trust Estate and to any indebtedness secured thereby and
to distribute the balance, if any, to Trustor as may be permitted by the terms
of the Project Documents.
3.2. REVOCATION OF LICENSE. Upon the occurrence of an Event of Default
and at any time thereafter during the continuance thereof, Beneficiary shall
have the right to revoke the license granted to Trustor hereby by giving written
notice of such revocation to Trustor. Upon such revocation, Trustor shall
promptly deliver to Beneficiary the original copies of all leases and all Rents
then held by Trustor and Beneficiary shall thereafter be entitled to enforce any
leases, to collect and receive, without deduction or offset, all Rents payable
thereunder, including but not limited to, all Rents which were accrued and
unpaid as of the date of such revocation and to apply such rents as provided in
the Project Documents. Trustor hereby irrevocably constitutes and appoints
Beneficiary its true and lawful attorney-in-fact to enforce, in Trustor's name
or in Beneficiary's name or otherwise, all rights of Trustor in the instruments,
including without limitation checks and money orders, tendered as payments of
rents and to do any and all things necessary and proper to carry out the
purposes hereof.
3.3. ELECTION OF REMEDIES. Upon the occurrence of an Event of Default
hereunder Beneficiary may, at its option, exercise (or cause the Trustee to
exercise) its rights hereunder. If Beneficiary elects to exercise its rights
hereunder, Beneficiary or Trustee may, at
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any time without notice, either in person, by agent or by a receiver appointed
by a court, enter upon and take possession of all or any portion of the Trust
Estate, enforce all leases, collect all Rents, including those past due and
unpaid, and apply the same to the costs and expenses of operation and
collection, including, without limitation, attorneys' fees, and to any
indebtedness then secured hereby, in such order as Beneficiary may determine. In
connection with the exercise by Beneficiary of its rights hereunder, Trustor
agrees that Beneficiary shall have the right to specifically enforce such rights
and to obtain the appointment of a receiver in accordance with the provisions of
Section 4.2 hereof without regard to the value of the Trust Estate or the
adequacy of any security for the obligations then secured hereby. The collection
of such Rents, or the entering upon and taking possession of the Trust Estate,
or the application thereof as aforesaid, shall not cure or waive any default or
notice of default hereunder or invalidate any act done in response to such
default or pursuant to such notice of default.
ARTICLE IV.
EVENTS OF DEFAULT AND REMEDIES
4.1. EVENTS OF DEFAULT. The occurrence of an Event of Default under
the Indenture shall constitute an "Event of Default" hereunder.
4.2. REMEDIES. Upon the occurrence of any Event of Default, Trustee
and Beneficiary shall have the following rights and remedies, in addition to
those specified in the Indenture and the Company Security Agreement (as defined
in the Indenture):
(I) Beneficiary in person or by agent may, without any obligation so
to do and without notice or demand upon Trustor and without releasing
Trustor from any obligation hereunder: (a) make any payment or do any act
which Trustor has failed to make or do; (b) enter upon, take possession of,
manage and operate the Trust Estate or any part thereof; (c) make or
enforce, or, if the same be subject to modification or cancellation, modify
or cancel any leases of the Trust Estate or any part thereof upon such
terms or conditions as Beneficiary deems proper; (d) obtain and evict
tenants, and fix or modify rents, make repairs and alterations and do any
acts which Beneficiary deems proper to protect the security hereof; and (e)
with or without taking possession, in its own name or in the name of
Trustor, xxx for or otherwise collect and receive rents, royalties, issues,
profits, revenue, income and other benefits, including those past due and
unpaid, and apply the same less costs and expenses of operation and
collection, including reasonable attorneys' fees, upon any indebtedness
secured hereby, and in such order as Beneficiary may determine. Upon
request of Beneficiary, Trustor shall assemble and make available to
Beneficiary at the Premises any of the non-fixed assets comprising the
Trust Estate which have been removed therefrom. The entering upon and
taking possession of the Trust Estate, the collection of any rents,
royalties, issues, profits, revenue, income or other benefits and the
application thereof as aforesaid shall not cure or waive any default
theretofore or thereafter occurring or affect any notice of default
hereunder or invalidate any act done pursuant to any such notice; and,
notwithstanding continuance in possession of the Trust Estate, or any part
thereof, by Beneficiary, Trustee or a receiver, and the
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collection, receipt and application of rents, royalties, issues, profits,
revenue, income or other benefits, Beneficiary shall be entitled to
exercise every right provided for in this Deed of Trust or by law upon or
after the occurrence of an Event of Default, including the right to
exercise the power of sale. Any of the actions referred to in this Section
4.2(i) may be taken by Beneficiary, either in person or by agent, with or
without bringing any action or proceeding, or by a receiver appointed by a
court, and any such action may also be taken irrespective of whether any
notice of default or election to sell has been given hereunder and without
regard to the adequacy of the security for the indebtedness hereby secured.
Further, Beneficiary, at the expense of Trustor, either by purchase, repair
or construction, may from time to time maintain and restore the Trust
Estate or any part thereof and complete construction of the Improvements
uncompleted as of the date thereof and in the course of such completion may
make such changes in the contemplated Improvements as Beneficiary may deem
desirable and may insure the same.
(II) Beneficiary shall be entitled, without notice and to the full
extent provided by law, to the appointment by a court having jurisdiction
of a receiver to take possession of and protect the Trust Estate or any
part thereof, and operate the same and collect the Rents and profits.
(III) Beneficiary may bring an action in any court of competent
jurisdiction to foreclose this Deed of Trust or enforce any of the terms,
covenants and conditions hereof.
(IV) Beneficiary may elect to cause the Trust Estate or any part or
parts thereof to be sold as follows:
(A) Beneficiary may proceed as if all of the Trust Estate were
real property in accordance with subparagraph (d) below, or Beneficiary may
elect to treat any of the Trust Estate which consists of a right in action
or which is property that can be severed from the Premises or the
Improvements without causing structural damage thereto as if the same were
personal property, and dispose of the same in accordance with subparagraph
(c) below, separate and apart from the sale of real property, the remainder
of the Trust Estate being treated as real property.
(B) Beneficiary may cause any such sale or other disposition to
be conducted immediately following the expiration of any grace period
herein or in the Indenture or the Company Security Agreement provided (or
immediately upon the expiration of any redemption or reinstatement period
required by law) or Beneficiary may delay any such sale or other
disposition for such period of time as Beneficiary deems to be in its best
interest. Should Beneficiary desire that more than one (1) such sale or
other disposition be conducted, Beneficiary may, at its option, cause the
same to be conducted simultaneously, or successively, on the same day, or
at such different days or times and in such order as Beneficiary may deem
to be in its best interest.
(C) Should Beneficiary elect to cause any of the Trust Estate to
be disposed of as personal property as permitted by subparagraph (a) above,
it may dispose of any part
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thereof in any manner now or hereafter permitted by the California
Commercial Code or in accordance with any other remedy provided by law. Any
such disposition may be conducted by an employee or agent of Beneficiary or
Trustee. Both Trustor and Beneficiary shall be eligible to purchase any
part or all of such property at any such disposition. Any such disposition
may be either public or private as Beneficiary may elect, subject to the
provisions of the California Commercial Code. Beneficiary shall have all of
the rights and remedies of a Secured Party under the California Commercial
Code. Expenses of retaking, holding, preparing for sale, selling or the
like shall include Beneficiary's reasonable attorneys' fees and legal
expenses, and upon such default, Trustor, upon demand of Beneficiary, shall
assemble such personal property and make it available to Beneficiary at the
Premises, a place which is hereby deemed reasonably convenient to
Beneficiary and Trustor. Beneficiary shall give Trustor at least five (5)
days prior written notice of the time and place of any public sale or other
disposition of such property or of the time at or after which any private
sale or any other intended disposition is to be made, and if such notice is
sent to Trustor, in the manner provided for the mailing of notices herein,
it shall constitute reasonable notice to Trustor.
(D) Should Beneficiary elect to sell the Trust Estate or any part
thereof which is real property or which Beneficiary has elected to treat as
real property, upon such election, Beneficiary or Trustee shall give such
notice of default and election to sell as may then be required by law.
Thereafter, upon the expiration of such time and the giving of such notice
of sale as may then be required by law, and without the necessity of any
demand on Trustor, Trustee, at the time and place specified in the notice
of sale, shall sell the Trust Estate, or any portion thereof specified by
Beneficiary, at public auction to the highest bidder for cash in lawful
money of the United States, subject, however, to the provisions of Section
4.2(vi). Trustee may, and upon request of Beneficiary shall, from time to
time postpone the sale of all or any portion of the Trust Estate by public
announcement at the time and place of such sale, and from time to time
thereafter may postpone such sale by public announcement at the time fixed
by the preceding postponement or subsequently noticed sale, and without
further notice make such sale at the time fixed by the last postponement,
or may, in its discretion, give a new notice of sale. If the Trust Estate
consists of several lots or parcels, Beneficiary may direct that the same
be sold as a unit or be sold separately and, if to be sold separately,
Beneficiary may designate the order in which such lots or parcels shall be
offered for sale or sold. Any person, including Trustor, Trustee or
Beneficiary, may purchase at the sale. Upon any sale, Trustee shall execute
and deliver to the purchaser or purchasers a deed or deeds conveying the
property so sold, but without any covenant or warranty whatsoever, express
or implied, whereupon such purchaser or purchasers shall be let into
immediate possession.
(E) Beneficiary, from time to time before any Trustee's sale as
provided herein, may rescind any notice of default and election to sell or
notice of sale by executing and delivering to Trustee a written notice of
such rescission, which such notice, when recorded, shall constitute a
cancellation of any prior declaration of default and demand for sale. The
exercise by Beneficiary of such right of rescission shall not
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constitute a waiver of any breach or default then existing or
subsequently occurring, or impair the right of Beneficiary to execute
and deliver to Trustee, as above provided, other declarations or
notices of default and demand for sale of the Trust Estate to satisfy
the obligations hereof, nor otherwise affect any provision, covenant
or condition of any Project Document.
(f) In the event of a sale or other disposition of the Trust
Estate, or any part thereof, and the execution of a deed or other
conveyance pursuant thereto, the recitals therein of facts, such as
default, the giving of notice of default and notice of sale, demand
that such sale should be made, postponement of sale, terms of sale,
sale, purchase, payment of purchase money and other facts affecting
the regularity or validity of such sale or disposition, shall be
conclusive proof of the truth of such facts and any such deed or
conveyance shall be conclusive against all persons as to such facts
recited therein.
(g) The acknowledgment of the receipt of the purchase money,
contained in any deed or conveyance executed as aforesaid, shall be
sufficient discharge to the grantee of all obligations to see to the
proper application of the consideration therefor as hereinafter
provided. The purchaser at any trustee's or foreclosure sale hereunder
may disaffirm any easement granted or rental or lease contract made in
violation of any provision of this Trust Estate and may take immediate
possession of the Trust Estate free from, and despite the terms of,
such grant of easement and rental or lease contract.
(h) Upon the completion of any sale or sales made by Trustee
or Beneficiary, as the case may be, under or by virtue of this Article
IV, Trustee or any officer of any court empowered to do so, shall
execute and deliver to the accepted purchaser or purchasers a good and
sufficient instrument, or good and sufficient instruments, conveying,
assigning and transferring all estate, right, title and interest in
and to the property and rights sold. Trustee is hereby irrevocably
appointed the true and lawful attorney-in-fact of Trustor in its name
and stead to make all necessary conveyances, assignments, transfers
and deliveries of the Trust Estate or any part thereof and the rights
so sold and for that purpose Trustee may execute all necessary
instruments of conveyance, assignment and transfer, and may substitute
one or more persons with like power, Trustor hereby ratifying and
confirming all that its said attorney or any substitute or substitutes
shall lawfully do by virtue hereof. Nevertheless, Trustor, if so
requested by Trustee or Beneficiary, shall ratify and confirm any such
sale or sales by executing and delivering to Trustee or to such
purchaser or purchasers all such instruments as may be advisable in
the judgment of Trustee or Beneficiary, for the purpose as may be
designated in such request. The foregoing power of attorney is coupled
with an interest and cannot be revoked. Any such sale or sales made
under or by virtue of this Article IV, whether made under the power of
sale herein granted or under or by virtue of judicial proceedings or
of a judgment or decree of foreclosure and sale, shall operate to
divest all of the estate, right, title, interest, claim and demand
whatsoever, whether at law or in equity, of Trustor in and to the
properties and rights so sold, and shall be a perpetual bar, both at
law and in equity, against Trustor and any and all persons claiming or
who may claim the same, or any part thereof, from, through or under
Trustor.
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(i) Trustor hereby expressly waives any right which it may
have to direct the order in which any of the Trust Estate shall be
sold in the event of any sale or sales pursuant hereto.
(v) The purchase money, proceeds or avails of any sale made under
or by virtue of this Article IV, together with all other sums which
may then be held by Trustee or Beneficiary under this Trust Estate,
whether under the provisions of this Article IV, or otherwise, shall
be applied as follows:
FIRST: To the payment of the costs and expenses of the sale,
including reasonable compensation to Trustee and Beneficiary,
their agents and counsel, and of any judicial proceedings wherein
the same may be made and to the payment of all expenses,
liabilities and advances made or incurred by Trustee under this
Deed of Trust, together with interest at the Post-Default Rate on
all advances made by Trustee and all taxes or assessments, except
for any taxes, assessments or other charges subject to which the
Trust Estate shall have been sold, and further including all
costs of publishing, recording, mailing and posting notice, the
cost of any search and/or other evidence of title procured in
connection therewith and the cost of any documentary transfer tax
on any deed of conveyance.
SECOND: To the payment of any and all sums expended under
the terms hereof, not then repaid, with accrued interest at the
Post-Default Rate and all other sums required to be paid by
Trustor pursuant to any provisions of this Deed of Trust or of
the Note (other than principal and interest as specified in
clause THIRD below) or of any other Loan Document, including all
expenses, liabilities and advances made or incurred by
Beneficiary under this Deed of Trust or in connection with the
enforcement hereof, together with interest at the Post-Default
Rate on all advances.
THIRD: To the payment of the principal and interest then
due, owing and unpaid upon the Note, with interest on the unpaid
principal at the Post-Default Rate from the due date of any such
payment of principal until the same is paid.
FOURTH: The remainder, if any, to the person or persons
legally entitled thereto.
(vi) Upon any sale or sales made under or by virtue of this
Article IV, whether made under the power of sale herein granted or
under or by virtue of judicial proceedings or of a judgment or decree
of foreclosure and sale, Beneficiary may bid for and acquire the Trust
Estate or any part thereof and, in lieu of paying cash therefor, may
make settlement for the purchase price by crediting upon the
indebtedness or other sums secured by this Deed of Trust the net sales
price after deducting therefrom the expenses of sale and the costs of
the judicial proceedings, if any, and any other sums which Trustee
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or Beneficiary is authorized to deduct under the Deed of Trust, and,
in such event, this Deed of Trust, the Note and documents evidencing
expenditures secured hereby shall be presented to the person or
persons conducting the sale in order that the amount so used or
applied may be credited upon said indebtedness as having been paid.
(vii) Upon the commencement of any action, suit or other legal
proceedings by Beneficiary to obtain judgment for the principal of, or
interest on, the Note and other sums required to be paid by Trustor
pursuant to any provision of this Deed of Trust, or of any other
nature in aid of the enforcement of the Note or of this Deed of Trust,
Trustor, to the fullest extent permitted by law, will and does hereby
(a) waive the issuance and service of process and enter its voluntary
appearance in such action, suit or proceedings, and (b) if required by
Beneficiary, consent to the appointment of a receiver or receivers of
the Trust Estate and of all the Rents and profits. After the happening
of any Event of Default, or upon the commencement of any proceedings
to foreclose this Deed of Trust or to enforce the specific performance
hereof or in aid thereof or upon the commencement of any other
judicial proceedings to enforce any right of Trustee or Beneficiary,
Trustee or Beneficiary shall be entitled forthwith, as a matter of
right, if either shall so elect, without the giving of notice to any
other party and without regard to the adequacy of the security of the
Trust Estate, either before or after declaring the unpaid principal of
the Note to be due and payable, to the appointment of such a receiver
or receivers.
(viii) Notwithstanding the appointment of any receiver,
liquidator or trustee of Trustor, or of any of its property, or of the
Trust Estate or any part thereof, Trustee and Beneficiary shall be
entitled to retain possession and control of all property now or
hereafter held under this Trust Estate, including, but not limited to,
the Rents and profits.
(ix) No remedy herein conferred upon or reserved to Trustee or
Beneficiary is intended to be exclusive of any other remedy herein or
by law provided, but each shall be cumulative and shall be in addition
to every other remedy given hereunder or now or hereafter existing at
law or in equity or by statute. No delay or omission of Trustee or
Beneficiary in exercising any right or power accruing upon any Event
of Default shall impair any right or power or shall be construed to be
a waiver of any Event of Default or any acquiescence therein; and
every power and remedy given by this Deed of Trust to Trustee or
Beneficiary may be exercised from time to time as often as may be
deemed expedient by Trustee or Beneficiary. If there exists additional
security for the performance of the obligations secured hereby, the
holder of the Note, at its sole option, and without limiting or
affecting any of the rights or remedies hereunder, may exercise any of
the rights and remedies to which it may be entitled hereunder either
concurrently with whatever rights it may have in connection with such
other security or in such order as it may determine. Nothing in this
Deed of Trust, the Note or any other Project Documents shall affect
the obligation of Trustor to pay the principal of, and interest on,
the Note in the manner and at the time and place therein respectively
expressed.
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(X) To the fullest extent permitted by applicable law, Trustor
will not at any time insist upon, or plead, or in any manner whatever
claim or take any benefit or advantage of any stay or extension or
moratorium law or law pertaining to the marshalling of assets, the
administration of estates of decedents, any exemption from execution
or sale of the Trust Estate or any part thereof, including exemption
of homestead, wherever enacted, now or at any time hereafter in force,
which may affect the covenants and terms of performance of this Deed
of Trust, nor claim, take or insist upon any benefit or advantage of
any law now or hereafter in force providing for the valuation or
appraisal of the Trust Estate, or any part thereof, prior to any sale
or sales thereof which may be made pursuant to any provision herein,
or pursuant to the decree, judgment or order of any court of competent
jurisdiction; nor after any such sale or sales, claim or exercise any
right under any statute heretofore or hereafter enacted to redeem the
property so sold or any part thereof, and Trustor hereby expressly
waives all benefit or advantage of any such law or laws, and covenants
not to hinder, delay or impede the execution of any power herein
granted or delegated to Trustee or Beneficiary, but to suffer and
permit the execution of every power as though no such law or laws had
been made or enacted. Trustor, for itself and all who claim under it,
hereby waives, to the extent that it lawfully may, all right to have
the Trust Estate marshalled upon any sale or foreclosure hereunder.
(XI)Upon the occurrence of any Event of Default and pending the
exercise by Trustee or Beneficiary or their agents or attorneys of
their right to exclude Trustor from all or any part of the Trust
Estate, Trustor agrees to vacate and surrender possession of the Trust
Estate to Trustee or Beneficiary, as the case may be, or to a
receiver, if any, and in default thereof may be evicted by any summary
action or proceeding for the recovery of possession of leased premises
for non-payment of rent, however designated.
(XII) In the event ownership of the Trust Estate or any portion
thereof becomes vested in a person other than the Trustor herein
named, Beneficiary may, without notice to the Trustor herein named,
whether or not Beneficiary has given written consent to such change in
ownership, deal with such successor or successors in interest with
reference to this Trust Estate and the indebtedness secured hereby,
and in the same manner as with the Trustor herein named, without in
any way vitiating or discharging Trustor's liability hereunder or for
the indebtedness or obligations hereby secured.
(XIII) In the event that there be a Trustee's sale hereunder and
if at the time of such sale Trustor, or its heir, executor,
administrator or assign, be occupying the Premises and Improvements or
any part thereof so sold, each and all shall immediately become the
tenant of the purchaser at such sale, which tenancy shall be a tenancy
from day to day, terminable at the will of either tenant or landlord,
at a reasonable rental per day based upon the value of the Premises
and Improvements, such rental to be due daily to the purchaser. An
action of unlawful detainer shall lie if the tenant holds over after a
demand in writing for possession of said Premises and Improvements;
and this agreement and the Trustee's deed shall constitute a lease and
agreement under which any such tenant's possession arose and
continued.
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(XIV) Trustor shall pay immediately, without notice or demand,
all costs and expenses in connection with the enforcement of
Beneficiary's rights hereunder, including without limitation
reasonable attorneys' fees, whether or not any suit is filed in
connection with such enforcement; such costs and expenses shall
include without limitation all costs, attorneys' fees and expenses
incurred by the holder of the Note in connection with any insolvency,
bankruptcy, reorganization, arrangement or other similar proceedings
involving Trustor, any endorser or guarantor of the Note or Trustor's
obligations under any Project Document, which in any way affects the
exercise by Beneficiary of its rights and remedies under the Note,
this Deed of Trust or any other Project Document.
ARTICLE V.
MISCELLANEOUS
5.1. AMENDMENTS. This instrument cannot be waived, changed,
discharged or terminated orally, but only by an instrument in writing signed by
the party against whom enforcement of any waiver, change, discharge or
termination is sought.
5.2. NO WAIVER. By accepting payment of any sum secured
hereby after its due date or in an amount less than the sum due, Beneficiary
does not waive its rights either to require prompt payment when due of all other
sums so secured.
5.3. LIMITATION OF LIABILITY. The sole recourse of
Beneficiary hereunder shall be to the Trust Estate and nothing contained herein
shall create any obligation of, or right to seek payment from, Trustor, its
Affiliates, officers, directors, equity holders, employees, agents or any other
Person or their respective Properties individually for the satisfaction of the
Obligations.
5.4. TRUSTEE'S POWERS. At any time, or from time to time,
without liability therefor and without notice, upon written request of
Beneficiary and presentation of this Deed of Trust and the Note for endorsement,
and without affecting the personal liability of any person for payment of all or
any portion of the indebtedness secured hereby or the effect of this Deed of
Trust upon the remainder of the Premises, Trustee may: reconvey any part of the
Premises; consent in writing to the making of any map or plat thereof; join in
granting any easement thereon; or join in any extension agreement or any
agreement subordinating the lien or charge hereof.
5.5. TRUSTOR WAIVER OF RIGHTS. Trustor waives to the extent
permitted by law, (i) the benefit of all laws now existing or that may hereafter
be enacted providing for any appraisement before sale of any portion of the
Trust Estate and (ii) all rights of redemption, valuation, appraisement, stay of
execution, notice of election to mature or declare due the whole of the secured
indebtedness and marshalling in the event of foreclosure of the liens hereby
created; provided, however, nothing contained herein shall be deemed to be a
waiver of Trustor's rights under Section 2924c of the California Civil Code.
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5.6. STATEMENTS OF TRUSTOR. Trustor shall, within ten (10)
days after written notice thereof from Beneficiary, deliver to Beneficiary a
written statement stating the unpaid principal of and interest on the Note and
any other amounts secured by this Deed of Trust and stating whether any offset
or defense exists against such principal and interest.
5.7. NOTICES. All notices, requests and other communications
provided for herein shall be given or made in writing (including, without
limitation, by telex or telecopy) delivered to the intended recipient at the
address set forth below or at such other address as shall be designated by such
party in a notice to each other party. Except as otherwise provided in this Deed
of Trust, all such communications shall be deemed to have been duly given when
transmitted by telecopier or personally delivered or, in the case of a mailed
notice, upon receipt, in each case given or addressed as aforesaid.
To Beneficiary:
----------------------------------------
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Attention:
-----------------------------
Fax No.:
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With a copy to: Milbank, Tweed, Xxxxxx & XxXxxx
000 Xxxxx Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Fax No.: (000) 000-0000
To Trustor:
----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
Attention:
-----------------------------
Fax No.:
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To Trustee:
----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
Attention:
-----------------------------
Fax No.:
-------------------------------
5.8. ACCEPTANCE BY TRUSTEE. Trustee accepts this Trust when
this Deed of Trust, duly executed and acknowledged, is made a public record as
provided by law.
5.9. CAPTIONS. The captions or headings at the beginning of
each Section hereof are for the convenience of the parties and are not a part of
this Deed of Trust.
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5.10. AFFIDAVIT TO TRUSTEE. Trustee, upon presentation to it of an
affidavit signed by or on behalf of Beneficiary, certifying the existence of an
Event of Default by Trustor under this Deed of Trust, is authorized to accept as
true and conclusive all facts and statements in such affidavit and to act
hereunder in complete reliance thereon.
5.11. INVALIDITY OF CERTAIN PROVISIONS. Every provision of this Deed
of Trust is intended to be severable. In the event any term or provision hereof
is declared to be illegal or invalid for any reason whatsoever by a court of
competent jurisdiction, such illegality or invalidity shall not affect the
balance of the terms and provisions hereof, which terms and provisions shall
remain binding and enforceable. If the lien of this Deed of Trust is invalid or
unenforceable as to any part of the debt, or if the lien is invalid or
unenforceable as to any part of the Trust Estate, the unsecured or partially
unsecured portion of the debt shall be completely paid prior to the payment of
the remaining and secured or partially secured portion of the debt, and all
payments made on the debt, whether voluntary or under foreclosure or other
enforcement action or procedure, shall be considered to have been first paid on
and applied to the full payment of that portion of the debt which is not secured
or fully secured by the lien of this Deed of Trust.
5.12. WAIVER OF STATUTE OF LIMITATIONS. The right to plead any and all
statutes of limitation as a defense to any demand secured by this Deed of Trust
is hereby waived to the full extent permitted by law.
5.13. GOVERNING LAW. This Deed of Trust and the indebtedness and
obligations secured hereby shall be governed by and construed in accordance with
the laws of the State of California, without reference to conflicts of laws
principles.
5.14. INTERPRETATION AND SUCCESSORS IN INTEREST. Subject to the
provisions of the Indenture prohibiting the disposition of any assets of
Trustor, this Deed of Trust applies to, inures to the benefit of, and binds all
parties hereto, their heirs, legatees, devisees, administrators, executors,
successors and assigns. In this Deed of Trust the singular shall include the
plural and the masculine shall include the feminine and neuter and vice versa,
if the context so requires. The word "person" shall include corporation,
partnership or other form of association. Any reference in this Deed of Trust to
any document, instrument or agreement creating or evidencing an obligation
secured hereby shall include such document, instrument or agreement both as
originally executed and as it may from time to time be modified.
5.15. RECONVEYANCE BY TRUSTEE. Upon written request of Beneficiary
stating that all sums secured hereby have been paid, and upon surrender of this
Deed of Trust and the Note to Trustee for cancellation and retention and upon
payment by Trustor of Trustee's fees, Trustee shall reconvey to Trustor, or to
the person or persons legally entitled thereto, without warranty, any portion of
the Trust Estate then held hereunder. The recitals in such reconveyance of any
matters or facts shall be conclusive proof of the truthfulness thereof. The
grantee in any reconveyance may be described as "the person or persons legally
entitled thereto."
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5.16. COUNTERPARTS; RECORDING REFERENCES. This Deed of Trust may be
executed in several original counterparts. To facilitate filing and recording,
there may be omitted from certain counterparts the parts of Exhibit A, B or C,
hereto containing specific descriptions of certain collateral constituting the
Trust Estate which relate to land under the jurisdiction of offices or located
in cities or counties other than the office or city or county in which the
particular counterpart is to be filed or recorded. A complete copy of this Deed
of Trust is being filed for record in the Offices of the County Recorders
of __________________ and _______________ Counties, California. Each counterpart
shall be deemed to be an original for all purposes, and all counterparts shall
together constitute a single document; provided, however, Beneficiary and
Trustee shall also have the option to exercise all rights and remedies available
to Beneficiary and Trustee hereunder and under applicable law as though each
counterpart hereof were a separate deed of trust, or other security instrument
covering only the portions of the collateral constituting the Trust Estate
located in the city or county wherein such counterpart is recorded. Unless
otherwise specified in Exhibit A, B or C hereto, all recording references in
Exhibits A, B and C are to the official real property records of the city or
county as appropriate, in which the affected land is located. The references in
Exhibit A, B or C to liens, encumbrances and other burdens, if any, shall not be
deemed to recognize or create any rights in third parties.
5.17. NONFOREIGN ENTITY. Section 1445 of the Internal Revenue Code of
1986, as amended (the "INTERNAL REVENUE CODE") provides that a transferee of a
U.S. real property interest must withhold tax if the transferor is a foreign
person. To inform Beneficiary that the withholding of tax will not be required
in the event of the disposition of the Premises or Improvements pursuant to the
terms of this Deed of Trust, Trustor hereby certifies, under penalty of perjury,
that:
(I) Trustor is not a foreign corporation, foreign partnership, foreign
trust or foreign estate, as those terms are defined in the Internal Revenue
Code and the regulations promulgated thereunder; and
(II) Trustor's U.S. employer identification number is _______________;
and
(III) Trustor's principal place of business is _________________.
It is understood that Beneficiary may disclose the contents of this
certification to the Internal Revenue Service and that any false statement
contained herein could be punished by fine, imprisonment or both. Trustor
covenants and agrees to execute such further certificates, which shall be signed
under penalty or perjury, as Beneficiary shall reasonably require. The covenant
set forth herein shall survive the foreclosure of the lien of this Deed of Trust
or acceptance of a deed in lieu thereof.
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IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the
day and year first above written.
--------------------------,
a
------------------------
By:
------------------------------------
Name:
------------------------------
Its:
-------------------------------
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[ACKNOWLEDGEMENT]
-25-
EXHIBIT A
Property
A-1
EXHIBIT B
Leases
B-1
EXHIBIT C
Easements
EXHIBIT F
FORM OF GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of February 13, 2004 (the "Indenture")
among Ormat Funding Corp., the Guarantors listed on the signature page thereto,
Ormesa LLC and Union Bank of California, N.A., as trustee (the "Trustee"), (a)
the due and punctual payment of the principal of, premium, Liquidated Damages,
if any, and interest on the Senior Secured Notes (as defined in the Indenture),
whether at maturity, by acceleration, redemption or otherwise, the due and
punctual payment of interest on overdue principal, premium, Liquidated Damages,
and, to the extent permitted by law, interest, and the due and punctual
performance of all other obligations of the Issuer to the Holders or the Trustee
all in accordance with the terms of the Indenture and (b) in case of any
extension of time of payment or renewal of any Senior Secured Notes or any of
such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. The obligations of the Guarantors
to the Holders of Senior Secured Notes and to the Trustee pursuant to the
Guarantee and the Indenture are expressly set forth in Article IX of the
Indenture and reference is hereby made to the Indenture for the precise terms of
the Guarantee. Each Holder of a Senior Secured Note, by accepting the same, (a)
agrees to and shall be bound by such provisions and (b) appoints the Trustee
attorney-in-fact of such Holder for such purpose.
[NAME OF GUARANTOR(S)]
By:
------------------
Name:
Title:
EXHIBIT G
[FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS]
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
____________________, among ____________________ (the "Guarantor"), a subsidiary
of ____________________ (or its permitted successor), a ____________________
corporation (the "Issuer"), the Issuer, the other Guarantors (as defined in the
Indenture referred to herein) and ____________________, as trustee under the
Indenture referred to below (the "Trustee").
WITNESSETH
WHEREAS, the Issuer and the Guarantors have heretofore executed and
delivered to the Trustee an indenture (the "Indenture"), dated as of February
13, 2004 providing for the issuance of 8 1/4% Senior Secured Notes due 2020 (the
"Senior Secured Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guarantor shall execute and deliver to the Trustee a supplemental indenture
pursuant to which the Guarantor shall unconditionally guarantee all of the
Issuer's Obligations under the Senior Secured Notes and the Indenture on the
terms and conditions set forth herein (the "Guarantee"); and
WHEREAS, pursuant to Article VIII of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guarantor and the Trustee mutually covenant and agree for the equal and ratable
benefit of the Holders of the Senior Secured Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meaning assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guarantor hereby agrees as follows:
(a) Along with all Guarantors named in the Indenture, to jointly and
severally, unconditionally Guarantee to each Holder of a Senior Secured
Note authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, the Senior Secured Notes or the obligations of the
Issuer hereunder or thereunder, that:
(i) the principal of, premium, Liquidated Damages, if any, and
interest on the Senior Secured Notes will be promptly paid in full
when due, whether at maturity, by acceleration, redemption or
otherwise, and interest on the overdue principal of, premium,
Liquidated Damages, and, to the extent permitted by law,
Exhibit G
Page 2
interest, and all other obligations of the Issuer to the Holders or
the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and
(ii) in case of any extension of time of payment or renewal of
any Senior Secured Notes or any of such other obligations, that same
will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
(b) The obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Senior Secured Notes or
the Indenture, the absence of any action to enforce the same, any waiver or
consent by any Holder of the Senior Secured Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Issuer, any action to enforce the same or any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of a
Guarantor.
(c) The following is hereby waived: diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Issuer, any right to require a proceeding first against
the Issuer, protest, notice and all demands whatsoever.
(d) This Guarantee shall not be discharged except by complete
performance of the obligations contained in the Senior Secured Notes and
the Indenture, and the Guarantor accepts all obligations of a Guarantor
under the Indenture.
(e) If any Holder or the Trustee is required by any court or otherwise
to return to the Issuer, the Guarantors, or any Custodian, Trustee,
liquidator or other similar official acting in relation to either the
Issuer or the Guarantors, any amount paid by either to the Trustee or such
Holder, this Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect.
(f) The Guarantor shall not be entitled to any right of subrogation in
relation to the Holders in respect of any obligations guaranteed hereby
until payment in full of all obligations guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the Holders and
the Trustee, on the other hand, (x) the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article V of the
Indenture for the purposes of this Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of
the obligations guaranteed hereby, and (y) in the event of any declaration
of acceleration of such obligations as provided in Article V of the
Indenture, such obligations (whether or not due and payable) shall
forthwith become due and payable by the Guarantors for the purpose of this
Guarantee.
Exhibit G
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(h) The Guarantors shall have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair
the rights of the Holders under the Guarantee.
(i) After giving effect to any maximum amount and any other contingent
and fixed liabilities that are relevant under any applicable Bankruptcy or
fraudulent conveyance laws, and after giving effect to any collections
from, rights to receive contribution from or payments made by or on behalf
of any other Guarantor in respect of the obligations of such other
Guarantor under Article IX of the Indenture, this new Guarantee shall be
limited to the maximum amount permissible such that the obligations of such
Guarantor under this Guarantee will not constitute a fraudulent transfer or
conveyance.
3. EXECUTION AND DELIVERY. Each Guarantor agrees that the Guarantees shall
remain in full force and effect notwithstanding any failure to endorse on each
Senior Secured Note a notation of such Guarantee.
4. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator or stockholder of the Issuer or any Guarantor,
as such, shall have any liability for any obligations of the Company or such
Subsidiary Guarantor under the Senior Secured Notes, the Guarantees, this
Indenture or the Collateral Documents or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder by accepting a
Senior Secured Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Senior Secured Notes.
5. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
6. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
7. EFFECT OF HEADINGS. The Section headings herein are for convenience only
and shall not affect the construction hereof.
8. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guarantor and the Issuer.
Exhibit G
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated:
-----------------------
[GUARANTOR]
By:
-------------------------------
Name:
Title:
ORMAT FUNDING CORP.
By:
-------------------------------
Name:
Title:
UNION BANK OF CALIFORNIA, N.A.
By:
-------------------------------
Authorized Signatory
Exhibit G
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SCHEDULE I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture as of
the Closing Date:
Xxxxx Power Partners
Steamboat Development Corp.
Steamboat Geothermal LLC
OrMammoth Inc.
ORNI 1 LLC
ORNI 2 LLC
ORNI 7 LLC
