Exhibit 4.35
GUARANTEE AGREEMENT
between
TECO ENERGY, INC.
(as Guarantor)
and
THE BANK OF NEW YORK
(as Guarantee Trustee)
dated as of
January 15, 2002
TABLE OF CONTENTS
Article I DEFINITIONS.................................................. 1
Section 1.1 Definitions............................................... 1
Article II TRUST INDENTURE ACT.......................................... 4
Section 2.1 Trust Indenture Act; Application.......................... 4
Section 2.2 List of Holders........................................... 4
Section 2.3 Reports by the Guarantee Trustee.......................... 5
Section 2.4 Periodic Reports to the Guarantee Trustee................. 5
Section 2.5 Evidence of Compliance with Conditions Precedent.......... 5
Section 2.6 Events of Default; Waiver................................. 5
Section 2.7 Event of Default; Notice.................................. 6
Section 2.8 Conflicting Interests..................................... 6
Article III POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE........... 6
Section 3.1 Powers and Duties of the Guarantee Trustee................ 6
Section 3.2 Certain Rights of Guarantee Trustee....................... 8
Section 3.3 Indemnity................................................. 10
Article IV GUARANTEE TRUSTEE............................................ 10
Section 4.1 Guarantee Trustee: Eligibility............................ 10
Section 4.2 Appointment, Removal and Resignation of the Guarantee
Trustee................................................... 10
Article V GUARANTEE.................................................... 11
Section 5.1 Guarantee................................................. 11
Section 5.2 Waiver of Notice and Demand............................... 11
Section 5.3 Obligations Not Affected.................................. 11
Section 5.4 Rights of Holders......................................... 12
Section 5.5 Guarantee of Payment...................................... 13
Section 5.6 Subrogation............................................... 13
Section 5.7 Independent Obligations................................... 13
Article VI COVENANTS AND SUBORDINATION.................................. 13
Section 6.1 Subordination............................................. 13
Section 6.2 Pari Passu Guarantees..................................... 13
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TABLE OF CONTENTS
(continued)
Page
Article VII TERMINATION.................................................. 14
Section 7.1 Termination............................................... 14
Article VIII MISCELLANEOUS................................................ 14
Section 8.1 Successors and Assigns.................................... 14
Section 8.2 Amendments................................................ 14
Section 8.3 Notices................................................... 14
Section 8.4 Benefit................................................... 15
Section 8.5 Interpretation............................................ 15
Section 8.6 Governing Law............................................. 16
Section 8.7 Counterparts.............................................. 16
-ii-
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of January 15, 2002, is executed and
delivered by TECO ENERGY, INC. (the "Guarantor"), a Florida corporation having
its principal office at TECO Plaza, 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx, Xxxxxxx,
00000, and THE BANK OF NEW YORK, a New York banking corporation, as trustee (the
"Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Company Preferred Securities (as defined herein) of TECO
Funding Company II, LLC, a Delaware limited liability company (the "LLC").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the "Trust
Agreement"), dated as of January 15, 2002 among the trustees named therein (the
"Trustees"), the LLC, as Depositor, and the Holders from time to time of
undivided beneficial ownership interests in the assets of TECO Capital Trust II
(the "Issuer"), a Delaware statutory business trust, the Issuer is issuing up to
$400,000,000 ($460,000,000 if the option granted to the underwriters is
exercised) aggregate liquidation preference of its 5.11% Trust Preferred
Securities (liquidation preference $25 per preferred security) (the "Trust
Preferred Securities") representing undivided beneficial ownership interests in
the assets of the Issuer and having the terms set forth in the Trust Agreement;
WHEREAS, the Issuer will use the proceeds of the Trust Preferred
Securities to purchase the preferred securities of the LLC (the "Company
Preferred Securities"), and the proceeds of the Company Preferred Securities and
the common securities of the LLC will be used to purchase $412,400,000 (up to
$474,260,000 if the option granted to the underwriters is exercised) of the
5.11% Junior Subordinated Notes due 2007 (the "Notes") of the Guarantor which
will constitute the principal assets of the LLC; and
WHEREAS, as incentive for the Issuer to purchase the Company Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth herein, to pay to the Holders of the Company Preferred
Securities the Guarantee Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the purchase by the Issuer and each
Holder of Company Preferred Securities, which purchase the Guarantor hereby
agrees shall benefit the Guarantor, the Guarantor executes and delivers this
Guarantee Agreement for the benefit of the Holders from time to time of the
Company Preferred Securities.
ARTICLE I
DEFINITIONS
SECTION 1.1.DEFINITIONS.
As used in this Guarantee Agreement, the terms set forth below shall,
unless the context otherwise requires, have the following meanings. Capitalized
or otherwise defined terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Trust Agreement as in effect on the date
hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person; provided, however, that an Affiliate of the
Guarantor shall not be deemed to include the Issuer. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Guarantee Agreement; provided, however, that,
except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default and shall not have cured such
default within 90 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Company Preferred Securities, to the
extent not paid or made by or on behalf of the LLC: (i) any accumulated and
unpaid Dividends (as defined in the LLC Agreement) required to be paid on such
Company Preferred Securities, (ii) the redemption price, including all
accumulated and unpaid Dividends to the date of redemption (the "Redemption
Price"), with respect to the Company Preferred Securities called for redemption
by the LLC, and (iii) upon a voluntary or involuntary termination, winding up or
liquidation of the LLC, unless Notes are distributed to the Holders, the greater
of (a) the aggregate of the liquidation preference of $25 per Company Preferred
Security plus accumulated and unpaid Dividends on the Company Preferred
Securities to the date of payment and (b) the amount of assets of the LLC
remaining available for distribution to Holders in liquidation of the LLC (in
either case, the "Liquidation Distribution"), provided, that, in no event shall
the payment of any amount under this Guarantee Agreement be reduced or avoided
by reason of any claim that the LLC does not have sufficient cash on hand or
funds legally available therefor.
"Guarantee Trustee" means The Bank of New York, until a Successor
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Guarantee Agreement and thereafter means each such
Successor Guarantee Trustee.
"Holder" means any holder, as registered on the books and records of the
Issuer, of any Trust Preferred Securities or, as registered on the books of the
LLC, of any Company Preferred Securities, as the context may require; provided,
however, that in determining whether the holders of the requisite percentage of
Trust Preferred Securities or Company Preferred Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor or the
Guarantee Trustee.
"Indebtedness" means, with respect to a Person, (i) the principal of and
premium, if any, and interest, if any, on, (A) indebtedness of such Person for
money borrowed and (B) indebtedness evidenced by securities, notes, debentures,
bonds or other similar instruments issued by such Person; (ii) all capital lease
obligations of such Person; (iii) all obligations of such Person issued or
assumed as the deferred purchase price of property, all conditional sale
obligations of such Person and all obligations of such Person under any
conditional sale or title retention agreement (but excluding trade accounts
payable and accrued liabilities in the ordinary course of business); (iv) all
obligations, contingent or otherwise, of such Person in respect of any
letters of credit, banker's acceptance, security purchase facilities or similar
credit transactions; (v) all obligations in respect of interest rate swap, cap,
floor, collar or other agreements, interest rate future or option contracts,
currency swap agreements, currency future or option contracts and other similar
agreements; and (vi) all obligations of the type referred to in clauses (i)
through (v) of others for the payment of which such Person is responsible or
liable as obligor, guarantor or otherwise.
"Indenture" means the Indenture, dated as of August 17, 1998, between the
Guarantor and The Bank of New York, as Trustee, together with the Sixth
Supplemental Indenture dated as of January 15, 2002 relating to the Notes, each
as amended or supplemented from time to time.
"Junior Subordinated Indebtedness" means all Indebtedness of the Guarantor
subordinate and junior to Subordinated Indebtedness and Senior Indebtedness.
"List of Holders" has the meaning specified in Section 2.2(a).
"LLC Agreement" means the Amended and Restated Limited Liability Company
Agreement of the LLC dated as of January 15, 2002, as the same may be amended
from time to time.
"Majority in liquidation preference of the Company Preferred Securities"
means, except as provided by the Trust Indenture Act, a vote by the Holder(s),
voting separately as a class, of more than 50% of the liquidation preference of
all then outstanding Company Preferred Securities issued by the LLC.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by the Chairman or a Vice Chairman of the Board, the President or a Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of such Person, and delivered to the Guarantee Trustee. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(c) a statement that each officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" means, with respect to the Guarantee Trustee, any
Senior Vice President, any Vice President, any Assistant Vice President, any
Assistant Secretary, any Assistant Treasurer, any trust officer or assistant
trust officer or any other officer or agent of the Corporate Trust Department 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 that officer's knowledge of and familiarity with the particular
subject.
"Senior Indebtedness" means all Indebtedness of the Guarantor, unless, in
the instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such obligations are not superior in right of
payment to Subordinated Indebtedness or Junior Subordinated Indebtedness or to
other Indebtedness of the Guarantor which is pari passu with, or subordinated
to, Subordinated Indebtedness or Junior Subordinated Indebtedness.
"Subordinated Indebtedness" means all Indebtedness of the Guarantor which
is subordinated and Junior in right of payment to Senior Indebtedness, but does
not include Junior Subordinated Indebtedness.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 0.0.XXXXX INDENTURE ACT; APPLICATION.
(a) This Guarantee Agreement is subject to the provisions of
the Trust Indenture Act that are required to be part of this Guarantee
Agreement and shall, to the extent applicable, be governed by such
provisions.
(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
SECTION 2.2.LIST OF HOLDERS.
(a) The Guarantor shall furnish or cause to be furnished to
the Guarantee Trustee (a) quarterly, on or before January 15, April 15,
July 15 and October 15 of each year, a list, in such form as the
Guarantee Trustee may reasonably require, of the names and addresses of
the Holders of the Company Preferred Securities ("List of Holders") as
of a date not more than 15 days prior to the delivery thereof, and (b)
at such other times as the Guarantee Trustee may request in writing,
within 30 days after the receipt by the Guarantor of any such request,
a List of Holders as of a date not more than 15 days prior to the time
such list is furnished, in each case to the extent such information is
in the possession or control of the Guarantor and is not identical to a
previously supplied list of Holders or has not otherwise been received
by the Guarantee Trustee in its capacity as
such. The Guarantee Trustee may destroy any List of Holders previously
given to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations
under Section 311(a), Section 311(b) and Section 312(b) of the Trust
Indenture Act.
SECTION 2.3.REPORTS BY THE GUARANTEE TRUSTEE.
Not later than 60 days following May 15 of each year, commencing May
15, 2002 the Guarantee Trustee shall provide to the Holders of the Company
Preferred Securities such reports as are required by Section 313 of the Trust
Indenture Act, if any, in the form and in the manner provided by Section 313 of
the Trust Indenture Act. The Guarantee Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Guarantee Trustee with each national stock exchange,
the Nasdaq National Market or such other interdealer quotation system or
self-regulatory organization upon which the Company Preferred Securities are
listed or traded, with the Commission and with the Guarantor. The Guarantor will
promptly notify the Guarantee Trustee when any Company Preferred Securities are
listed on any stock exchange and of any delisting thereof.
SECTION 2.4.PERIODIC REPORTS TO THE GUARANTEE TRUSTEE.
The Guarantor shall provide to the Guarantee Trustee, the Securities
and Exchange Commission and the Holders such documents, reports and information,
if any, as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act, in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
SECTION 2.5.EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such conditions precedent, if any, provided for in this
Guarantee Agreement that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
SECTION 0.0.XXXXXX OF DEFAULT; WAIVER.
The Holders of a Majority in liquidation preference of the Company
Preferred Securities may, by vote, on behalf of the Holders, waive any past
Event of Default and its consequences. Upon such waiver, any such Event of
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Guarantee Agreement, but
no such waiver shall extend to any subsequent or other default or Event of
Default or impair any right consequent therefrom.
SECTION 2.7.EVENT OF DEFAULT; NOTICE.
(a) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default known to the Guarantee Trustee,
transmit by mail, first class postage prepaid, to the Holders of the
Company Preferred Securities, notices of all such Events of Default
unless such defaults have been cured or waived before the giving of
such notice; provided, that, except in the case of a default in the
payment of a Guarantee Payment, the Guarantee Trustee shall be
protected in withholding such notice if and so long as the Board of
Directors, the executive committee or a trust committee of directors
and/or Responsible Officers of the Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of
the Holders.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Guarantee Trustee shall
have received written notice, or a Responsible Officer charged with the
administration of the Trust Agreement shall have obtained written
notice, of such Event of Default.
SECTION 2.8.CONFLICTING INTERESTS.
(a) The Trust Agreement shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture
Act.
(b) The Guarantee Trustee shall comply with its obligations
under Sections 310(b) and 311 of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
SECTION 3.1 POWERS AND DUTIES OF THE GUARANTEE TRUSTEE.
(a) This Guarantee Agreement shall be held by the Guarantee
Trustee for the benefit of the Holders of the Company Preferred
Securities, and the Guarantee Trustee shall not transfer this Guarantee
Agreement to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to
act as Successor Guarantee Trustee. The right, title and interest of
the Guarantee Trustee shall automatically vest in any Successor
Guarantee Trustee, upon acceptance by such Successor Guarantee Trustee
of its appointment hereunder, and such vesting and cessation of title
shall be effective whether or not conveyancing documents have been
executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the
benefit of the Holders of the Company Preferred Securities.
(c) This Guarantee Agreement and all moneys received by the
Guarantee Trustee in respect of the Guarantee Payments will not be
subject to any right, charge, security interest, lien or claim of any
kind in favor of, or for the benefit of, the Guarantee Trustee or its
agents or their creditors.
(d) The Guarantee Trustee, before the occurrence of any Event
of Default and after the curing or waiver of all Events of Default that
may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Guarantee Agreement, and no implied
covenants shall be read into this Guarantee Agreement against the
Guarantee Trustee. In case an Event of Default has occurred (that has
not been cured or waived pursuant to Section 2.6), the Guarantee
Trustee shall exercise such of the rights and powers vested in it by
this Guarantee Agreement, and use the same degree of care and skill in
its exercise thereof, as a prudent person would exercise or use under
the circumstances in the conduct of his or her own affairs.
(e) No provision of this Guarantee Agreement shall be
construed to relieve the Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default
and after the curing or waiving of all such Events of Default
that may have occurred:
(A) the duties and obligations of the
Guarantee Trustee shall be determined solely by the
express provisions of this Guarantee Agreement, and
the Guarantee Trustee shall not be liable except for
the performance of such duties and obligations as are
specifically set forth in this Guarantee Agreement;
and
(B) in the absence of bad faith on the part
of the Guarantee Trustee, the Guarantee Trustee may
conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished
to the Guarantee Trustee and conforming to the
requirements of this Guarantee Agreement; but in the
case of any such certificates or opinions that by any
provision hereof or of the Trust Indenture Act are
specifically required to be furnished to the
Guarantee Trustee, the Guarantee Trustee shall be
under a duty to examine the same to determine whether
or not they conform to the requirements of this
Guarantee Agreement;
(ii) the Guarantee Trustee shall not be liable for
any error of judgment made in good faith by a Responsible
Officer of the Guarantee Trustee, unless it shall be proved
that the Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of the Holders of
not less than a Majority in liquidation preference of the
Company
Preferred Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if the Guarantee Trustee shall have
reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the
terms of this Guarantee Agreement or adequate indemnity
against such risk or liability is not reasonably assured to
it.
SECTION 3.2 CERTAIN RIGHTS OF GUARANTEE TRUSTEE.
(a) Subject to the provisions of Section 3.1:
(i) The Guarantee Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document reasonably
believed by it to be genuine and to have been signed, sent or presented
by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this Guarantee Agreement shall be sufficiently evidenced by an
Officer's Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a matter
be proved or established before taking, suffering or omitting to take
any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its
part, request and rely upon an Officers' Certificate which, upon
receipt of such request from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel of
its selection, and the written advice or opinion of such legal counsel
with respect to legal matters shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to
be taken by it hereunder in good faith and in accordance with such
advice or opinion. Such legal counsel may be legal counsel to the
Guarantor or any of its Affiliates and may be one of its employees. The
Guarantee Trustee shall have the right at any time to seek instructions
concerning the administration of this Guarantee Agreement from any
court of competent jurisdiction.
(v) The Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee
Agreement at the request or
direction of any Holder, unless such Holder shall have provided to the
Guarantee Trustee such adequate security and indemnity as would satisfy
a reasonable person in the position of the Guarantee Trustee, against
the costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such request
or direction, including such reasonable advances as may be requested by
the Guarantee Trustee; provided that, nothing contained in this Section
3.2(a)(v) shall be taken to relieve the Guarantee Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Guarantee Agreement.
(vi) The Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Guarantee Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and if the Guarantee Trustee
shall determine to make such further inquiry or investigation, it shall
be entitled to examine the books, records and premises of the
Guarantor, personally or by agent or attorney.
(vii) The Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through its agents or attorneys, and the Guarantee Trustee shall not
be responsible for any misconduct or negligence on the part of any such
agent or attorney appointed with due care by it hereunder.
(viii) Any action taken by the Guarantee Trustee or its agents
hereunder shall bind the Holders, and the signature of the Guarantee
Trustee or its agents alone shall be sufficient and effective to
perform such action. No third party shall be required to inquire as to
the authority of the Guarantee Trustee to so act or as to its
compliance with any of the terms and provisions of this Guarantee
Agreement, both of which shall be conclusively evidenced by the
Guarantee's or its agent's taking such action.
(ix) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking
any other action hereunder, the Guarantee Trustee (A) may request
instructions from the Holders of a Majority in Liquidation Amount of
the Company Preferred Securities, (B) may refrain from enforcing such
remedy or right or taking such other action until such instructions are
received, and (C) shall be protected in acting in accordance with such
instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose
any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts or to
exercise any such right, power, duty or obligation. No permissive power
or authority available to the Guarantee Trustee shall be construed to
be a duty to act in accordance with such power and authority.
SECTION 3.3 INDEMNITY.
The Guarantor agrees to indemnify the Guarantee Trustee for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Guarantee Trustee, arising out of or
in connection with the acceptance or administration of this Guarantee Agreement,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder. The Guarantee Trustee will not claim or exact any lien or
charge on any Guarantee Payments as a result of any amount due to it under this
Guarantee Agreement.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 GUARANTEE TRUSTEE: ELIGIBILITY.
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the
Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000, and shall be a
corporation meeting the requirements of Section 310(c) of the
Trust Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority, then,
for the purposes of this Section and to the extent permitted
by the Trust Indenture Act, the combined capital and surplus
of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section
4.2(c).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE
TRUSTEE.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a
Successor Guarantee Trustee has been appointed and has accepted such
appointment by written instrument executed by such Successor Guarantee
Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold
office until a Successor Guarantee Trustee shall have been appointed or
until its removal or resignation. The Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Guarantee Trustee and delivered
to the Guarantor, which resignation shall not take effect until a
Successor Guarantee Trustee has been appointed and has accepted such
appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning
Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2
within 60 days after delivery to the Guarantor of an instrument of
resignation, the resigning Guarantee Trustee may petition, at the
expense of the Guarantor, any court of competent jurisdiction for
appointment of a Successor Guarantee Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper, appoint a
Successor Guarantee Trustee.
ARTICLE V
GUARANTEE
SECTION 5.1 GUARANTEE.
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders of the Company Preferred Securities the Guarantee Payments (without
duplication of amounts theretofore paid by or on behalf of the LLC), as and when
due, regardless of any defense, right of setoff or counterclaim which the LLC
may have or assert, including any claim that the LLC does not have sufficient
cash on hand or funds legally available to make such payments. The Guarantor's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Guarantor to the Holders of the Company Preferred
Securities or by causing the LLC to pay such amounts to the Holders.
SECTION 5.2 WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of the Guarantee
Agreement and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the
Guarantee Trustee, LLC or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.3 OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the Guarantor
under this Guarantee Agreement shall in no way be affected or impaired by reason
of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the LLC of any express or implied
agreement, covenant, term or condition relating to the Company
Preferred Securities to be performed or observed by the LLC;
(b) the extension of time for the payment by the LLC of all or
any portion of the Dividends (other than an extension of time for
payment of Dividends that results from the extension of any interest
payment period on the Notes as so provided in the Indenture),
Redemption Price, Liquidation Distribution or any other sums payable
under the terms of the Company Preferred Securities or the extension of
time for the performance of any other obligation under, arising out of,
or in connection with, the Company Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the
terms of the Company Preferred Securities, or any action on the part of
the LLC granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the LLC or any of the assets of the LLC;
(e) any invalidity of, or defect or deficiency in, the Company
Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it
being the intent of this Section 5.3 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
the consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 RIGHTS OF HOLDERS.
The Guarantor expressly acknowledges that: (i) this Guarantee Agreement
will be deposited with the Guarantee Trustee to be held for the benefit of the
Holders of the Company Preferred Securities; (ii) the Guarantee Trustee has the
right to enforce this Guarantee Agreement on behalf of the Holders of the
Company Preferred Securities; (iii) the Holders of a Majority in liquidation
preference of the Company Preferred Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Guarantee Trustee in respect of this Guarantee Agreement or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee
Agreement; and (iv) to the fullest extent permitted by law, without the need for
any other action of any person, including the Guarantee Trustee or
any other Holder of Trust Preferred Securities or Company Preferred Securities,
each Holder of Trust Preferred Securities or Company Preferred Securities will
be entitled to enforce the rights of the Holders of the Company Preferred
Securities under this Guarantee Agreement. The Guarantor waives, any right or
remedy to require that any action on this Guarantee Agreement be brought first
against the LLC or any other Person or entity before proceeding directly against
the Guarantor.
SECTION 5.5 GUARANTEE OF PAYMENT.
This Guarantee Agreement creates a guarantee of payment and not of
collection. This Guarantee Agreement will not be discharged except by payment of
the Guarantee Payments in full (without duplication of amounts theretofore paid
by the LLC) or upon distribution of the Notes to Holders as provided in the LLC
Agreement and the Trust Agreement.
SECTION 5.6 SUBROGATION.
The Guarantor shall be subrogated to all (if any) rights of the Holders
against the LLC in respect of any amounts paid to the Holders by the Guarantor
under this Guarantee Agreement and shall have the right to waive payment by the
LLC pursuant to Section 5.1; provided, however, that the Guarantor shall not
(except to the extent required by mandatory provisions of law) be entitled to
enforce or exercise any rights which it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a result of payment
under this Guarantee Agreement, if at the time of any such payment, any amounts
are due and unpaid under this Guarantee Agreement. If any amount shall be paid
to the Guarantor in violation of the preceding sentence, the Guarantor agrees to
hold such amount in trust for the Holders of the Company Preferred Securities
and to pay over such amount to the Holders.
SECTION 5.7 INDEPENDENT OBLIGATIONS.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the LLC with respect to the Company Preferred
Securities and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Guarantee
Agreement notwithstanding the occurrence of any event referred to in subsections
(a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
COVENANTS AND SUBORDINATION
SECTION 6.1 SUBORDINATION.
This Guarantee Agreement will constitute an unsecured obligation of the
Guarantor and will rank subordinate and junior in right of payment to all Senior
Indebtedness and Subordinated Indebtedness of the Guarantor.
SECTION 6.2 PARI PASSU GUARANTEES
This Guarantee Agreement shall rank pari passu with any similar
Guarantee Agreements issued by the Guarantor on behalf of the Holders of Company
Preferred Securities issued by the LLC.
ARTICLE VII
TERMINATION
SECTION 7.1 TERMINATION.
This Guarantee Agreement shall terminate and be of no further force and
effect upon (i) full payment of the Redemption Price of all Company Preferred
Securities, (ii) the distribution of Notes to the Holders in exchange for all of
the Company Preferred Securities or (iii) full payment of the amounts payable in
accordance with the Trust Agreement upon liquidation of the LLC, provided,
however, that the provisions of Section 3.3 hereof shall survive the termination
of this Guarantee Agreement. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid with respect
to Company Preferred Securities or this Guarantee Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 SUCCESSORS AND ASSIGNS.
All guarantees and agreements contained in this Guarantee Agreement
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders of the Company
Preferred Securities then outstanding. Except in connection with a
consolidation, merger or sale involving the Guarantor that is permitted under
Article Eight of the Indenture and pursuant to which the assignee agrees in
writing to perform the Guarantor's obligations hereunder, the Guarantor shall
not assign its obligations hereunder. If the LLC is liquidated and the Notes are
distributed to the Property Trustee (as defined in the Trust Agreement) to be
held as Trust Property (as defined in the Trust Agreement), then the Guarantor's
obligations under this Guarantee Agreement with respect to the Company Preferred
Securities shall be deemed to be obligations with respect to the Trust Preferred
Securities, and obligations of the Trust rather than the LLC.
SECTION 8.2 AMENDMENTS.
Except with respect to any changes which do not adversely affect the
rights of the Holders of the Company Preferred Securities in any material
respect (in which case no consent of the Holders will be required), this
Guarantee Agreement may be amended only with the prior approval of the Holders
of not less than a Majority in liquidation preference of all the outstanding
Company Preferred Securities. The provisions of Article VIII of the LLC
Agreement concerning meetings of the Holders shall apply to the giving of such
approval.
SECTION 8.3 NOTICES.
Any notice, request or other communication required or permitted to be
given hereunder shall be in writing, duly signed by the party giving such
notice, and delivered, telecopied or mailed by first class mail as follows:
(a) if given to the Guarantee Trustee, at the Guarantee
Trustee's mailing address set forth below (or such other address as the
Guarantee Trustee may give notice of to the Guarantor and the Holders):
The Bank of New York
000 Xxxxxxx Xxxxxx
00xx Xxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
(b) if given to the Guarantor, to the address set forth below
or such other address, facsimile number or to the attention of such
other Person as the Guarantor may give notice to the Holders of the
Company Preferred Securities:
TECO Energy, Inc.
TECO Plaza
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Secretary
(c) if given to any Holder, at the address set forth on the
books and records of the LLC.
All notices hereunder shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
SECTION 8.4 BENEFIT.
This Guarantee Agreement is for the benefit of the Holders of the
Company Preferred Securities and is not separately transferable from the Company
Preferred Securities. In addition, this Guarantee Agreement is for the benefit
of the Holders of the Trust Preferred Securities and is not separately
transferable from the Trust Preferred Securities.
SECTION 8.5 INTERPRETATION.
In this Guarantee Agreement, unless the context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to
them in Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as modified,
supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement
unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless otherwise defined
in this Guarantee Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
SECTION 8.6 GOVERNING LAW.
This Guarantee Agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of New York without regard
to the conflict of law principles thereof.
SECTION 8.7 COUNTERPARTS.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
THIS GUARANTEE AGREEMENT is executed as of the date first above written.
TECO ENERGY, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President - Treasurer
THE BANK OF NEW YORK
as Guarantee Trustee
By: /s/ Xxxx XxXxxxxx
---------------------------------------
Name: Xxxx XxXxxxxx
Title: Vice President
