EXHIBIT 99.2
STANDSTILL AGREEMENT
Standstill Agreement dated as of November 7, 2001 by and
between York Research Corporation, a Delaware corporation ("York"); its
undersigned subsidiaries (collectively with York, the "York Parties") and the
undersigned persons who are beneficial owners of, or have investment discretion
with respect to, Portfolio Bonds (defined below) (collectively "Consenting
Holders").
WHEREAS, pursuant to a Trust Indenture dated August 4, 1998
(the "Trust Indenture") under which The Bank of New York, a New York banking
corporation is bond trustee, (in such capacity and as collateral agent and
depositary bank, the "Trustee") 12.0% Senior Secured Bonds due October 30, 2007
(the "Portfolio Bonds") were issued by York Power Funding (Cayman) Limited, a
limited liability company incorporated under the laws of the Cayman Islands (the
"Issuer"). Capitalized terms used herein but not defined herein shall have such
definition as is provided for in the Trust Indenture;
WHEREAS, the Issuer loaned the proceeds of the sale of the
Portfolio Bonds to various direct and indirect subsidiaries and affiliates of
York (the "Subsidiaries") pursuant to the Finance Documents.
WHEREAS, certain of the Consenting Holders have formed an
informal committee (the "Bondholders Committee");
WHEREAS, the York Parties, the Bondholders Committee, Credit
Suisse First Boston and the Trustee have commenced discussions relating to the
Finance Documents (the "Discussions");
NOW, THEREFORE, in consideration of the foregoing and in
connection with the Discussions, the undersigned parties agree as follows:
1. Forbearance. (a) Each of the Consenting Holders agrees
that, so long as this agreement shall remain in effect (the "Forbearance
Period"), it shall forbear and not exercise, and it shall not instruct the
Trustee to exercise, any remedies that might otherwise be available to it or the
Trustee at any time under any of the Finance Documents to collect the
indebtedness thereunder or to realize upon the collateral therefor, including,
without limitation, the commencement of any action, suit or proceeding against
York or any Subsidiary for payment; the acceleration of the maturity of any
indebtedness now or hereafter owed under the Finance Documents; the exercise of
any right of set off or offset; or the realization upon or enforcement of any
rights against collateral, including without limitation any securities pledged
or funds held in deposit accounts; provided, however, that nothing herein shall
prevent the Consenting Holders from enforcing any other rights they may have
under the Finance Documents during the Forbearance Period, including rights as
against the Trustee, or enforcing this agreement.
(b) Following the Forbearance Period, each Consenting Holder
shall be entitled to exercise and enforce, and to instruct the Trustee to
exercise and enforce, any and all rights and remedies available to it or the
Trustee at the time under the Finance Documents as a consequence of the
continuance of any Indenture Defaults or Indenture Events of Default. Such
Consenting Holder by agreeing to forbear is not waiving, and the Trustee shall
not be considered to have waived, any Indenture Default or Indenture Event of
Default or any rights or remedies in respect thereto.
2. Covenants of York Parties. During the Forbearance Period, the York Parties
shall:
(a) use their best efforts to work with the Trustee to establish
blocked accounts, required by the Finance Documents, relating to the Trinidad
Project; provided, that such arrangements shall provide for the disbursement
from such accounts of funds for the Trinidad Project as provided for by the
Finance Documents;
(b) consult regularly with a designee of, and counsel to, the
Bondholders Committee regarding sale of any material assets, including the
proposed sale of the Trinidad Project to NRG, including consultations prior to
significant negotiations with either the potential buyers or the Trinidad
government authorities including T&TEC;
(c) not sell any material assets without the consent of Consenting
Noteholders who hold, in the aggregate, 51% of the outstanding principal amount
of the Portfolio Bonds;
(d) Promptly provide all requested financial information reasonably
requested by counsel to the Bondholder Committee, including current, projected
future and historical cash flows, bank account records and budgets, subject to
reasonable confidentiality provisions to be negotiated in good faith;
(e) not later than December 31, 2001 provide, subject to reasonable
confidentiality provisions to be negotiated in good faith, a written report by
outside independent accountants regarding the diversion of approximately $17
million referenced in York's Form 8-K dated as of October 30, 2001 (the "8K");
such report shall be the same report delivered to the Finance Committee of
York's board of directors;
(f) promptly provide the Consenting Bondholders and counsel to the
Bondholders Committee with notice of any defaults or events of default that the
York Parties believe exist under the Financing Documents, beyond the events
described in York's letter to the Trustee dated November 1, 2001; and
(g) consult with and update the Consenting Noteholders and the
Bondholders Committee regarding all discussions and negotiations with creditors
of York and discussions and negotiations regarding the NAEC bankruptcy.
3. Term. (a) The effective date of this agreement shall be November 8, 2001 (the
"Effective Date").
(b) This agreement shall be effective until terminated under
subsection (c).
(c) Termination. This agreement shall terminate upon the
earliest to occur of:
(i) by written notice to York (a "Termination Notice") signed
by Consenting Holders beneficially owning or controlling at
least 51% of the outstanding principal amount of Portfolio
Bonds, with such termination being effective at 5:00 p.m.
prevailing New York time on the fifth business day next
following the date of receipt by York of the Termination
Notice or at such later time as may be specified in such
Termination Notice;
(ii) the termination of the Agreement(as defined in the
8K);
(iii) the commencement of any insolvency proceeding by or
against any of the York Parties or the Issuer;
(iv) any material breach of York's covenants contained in
this agreement which is not cured within 5 days after written
notice thereof is given to the York Parties; and
(v) 5:00 p.m. prevailing New York time on November 21,
2001.
4. Reservations of Rights.
(a) Continuing Effect of Finance Documents. Except as
expressly provided in this agreement, each Finance Document shall continue
unchanged and in full force and effect, and all rights, powers and remedies
thereunder shall be expressly reserved.
(b) Reservation of Rights. Nothing in this agreement shall be
construed as a waiver of any right of (i) the Consenting Holders, any beneficial
owner or Holder of any Portfolio Bonds, or the Trustee against any of the York
Parties, the Issuer, the Trustee, any affiliate of the foregoing or any other
person, or (ii) any of the York Parties against any Person, or as an estoppel,
admission, waiver or other binding statement by the Consenting Holders, any
beneficial owner or Holder of Portfolio Bonds, the Trustee or any York Party
with respect to the current status of, any rights or remedies available with
respect to, or any causes of action relating in any way to the Portfolio Bonds
and the Financing Documents.
5. Successors and Assigns. This agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, legal
representatives, successors and assigns; and no third party shall have any
right to rely upon or enforce any provision of this agreement. Prior to the
termination hereof, no party hereto may assign any of its rights or claims
under the Finance Documents without first having the assignee agree in
writing to be bound by this agreement.
6. Each Consenting Holder represents and warrants that it is the beneficial
owner of, or has investment discretion with respect to, the principal
amount of Portfolio Bonds set forth next to its signature below and if any
record holder of such Portfolio Bonds proposes to take any action in
violation of this Agreement, agrees to instruct the record holder of such
Portfolio Bonds to comply with the provisions of this Agreement.
7. Governing Law. This agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York applicable to
contracts made and to be performed entirely within such State, without
reference to conflict of laws principles.
8. Notice. If notice is given to any of the York Parties, it shall be addressed
as follows:
c/o York Research Corporation
000 Xxxx Xxxxxx
Xxxxx 0000X
Xxx Xxxx, XX 00000
Attn: President
Fax No. (000) 000-0000
with a copy to:
Moses & Singer LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxx, Esq. and Xxxxxx Xxxxx, Esq.
Fax No. (000) 000-0000
9. Authority to Sign; Several Liability. Each party signing this agreement
represents that such party has full power and authority to do so, that it
consulted with counsel of its choice prior to doing so, and that it had read
and understands the provisions of this agreement. Each Consenting Holder's
duties and obligations under this agreement are its several obligations, and
no Consenting Holder shall have joint or joint and several liability
hereunder.
10. Counterparts. This agreement may be executed in counterparts, each of which
shall constitute an original and all of which taken together shall
constitute one agreement. Delivery by facsimile of a signed counterpart of
this agreement shall be as effective as delivery of a manually signed
original counterpart.
11. Headings. Headings used in this agreement are for convenience of reference
only and shall not affect the construction of this agreement.
12. Integration. This agreement constitutes the entire agreement among the
parties hereto with respect to the subject matter hereof.
Waiver. No provision of this agreement may be waived, canceled, discharged,
amended, modified or terminated (except as set forth in Section 3) nor any
enforcement of this agreement pursuant to its terms be estopped except in
writing signed by the party sought to be charged therewith.
YORK RESEARCH CORPORATION
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: President
BROOKLYN NAVY YARD POWER LLC
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: Authorized Signatory
WARBASSE POWER I LLC
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: Authorized Signatory
WARBASSE POWER II LLC
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: Authorized Signatory
NEW WORLD POWER TEXAS RENEWABLE
ENERGY LIMITED PARTNERSHIP
By: BIG SPRINGS TEXAS ENERGY
MANAGEMENT, INC., its General Partner
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: President
YORK EX INTERNATIONAL SRL
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: President
YORK HOLDINGS (BARBADOS) SRL
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: President
INNCOGEN, LIMITED
By:
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Name: Xxxxxx X. Xxxxxxxx
Title: President
[Consenting Holders] Principal Amount of Portfolio Bonds held
