Exhibit 4.17
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SECOND AMENDED AND RESTATED
PLEDGE AND SECURITY AGREEMENT
(LP Interests)
dated as May 21, 1999
between
LSP BATESVILLE HOLDING, LLC
and
THE BANK OF NEW YORK,
as Collateral Agent
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TABLE OF CONTENTS
Page
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RECITALS.......................................................................1
AGREEMENT......................................................................2
ARTICLE 1: DEFINITIONS; PRINCIPLES OF CONSTRUCTION............................3
Section 1.1 Definitions...................................................3
Section 1.2 Principles of Construction....................................3
ARTICLE 2: PLEDGE.............................................................3
Section 2.1 Pledged Collateral............................................4
Section 2.2 Delivery of Certificates and Instruments......................5
Section 2.3 Pledgor's Rights..............................................5
(a) Distributions.................................................5
(b) Other Rights..................................................6
(c) Turnover ...................................................6
Section 2.4 Secured Parties Not Liable....................................6
Section 2.5 Attorney-in-Fact..............................................7
Section 2.6 Collateral Agent May Perform..................................7
Section 2.7 Reasonable Care...............................................7
Section 2.8 Security Interest Absolute....................................8
Section 2.9 Effective as a Financing Statement............................8
ARTICLE 3: REPRESENTATIONS AND WARRANTIES.....................................8
Section 3.1 Necessary Filings.............................................9
Section 3.2 No Liens......................................................9
Section 3.3 Other Financing Statements....................................9
Section 3.4 Chief Executive Office........................................9
Section 3.5 Consents, etc.................................................9
ARTICLE 4: COVENANTS.........................................................10
Section 4.1 Sale of Pledged Collateral...................................10
Section 4.2 No Other Liens...............................................10
Section 4.3 Chief Executive Office.......................................10
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Page
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Section 4.4 Supplements; Further Assurances, etc.........................10
Section 4.5 Amendment of Partnership Agreement...........................11
Section 4.6 Certificates and Instruments.................................11
Section 4.7 Financing Statements.........................................11
Section 4.8 Records; Statements and Schedules............................11
Section 4.9 Improper Distributions.......................................12
Section 4.10 Bankruptcy..................................................12
ARTICLE 5: EXERCISE OF REMEDIES UPON AN EVENT OF DEFAULT.....................12
Section 5.1 Remedies Generally...........................................12
Section 5.2 Sale of Pledged Collateral...................................13
Section 5.3 Purchase of Pledged Collateral...............................14
Section 5.4 Application of Proceeds......................................14
ARTICLE 6; MISCELLANEOUS PROVISIONS..........................................14
Section 6.1 Notices......................................................14
Section 6.2 Continuing Security Interest.................................15
Section 6.3 Release......................................................15
Section 6.4 Reinstatement................................................15
Section 6.5 Independent Security.........................................15
Section 6.6 Amendments...................................................16
Section 6.7 Successors and Assigns.......................................16
Section 6.8 Third Party Beneficiaries....................................16
Section 6.9 Survival.....................................................16
Section 6.10 No Waiver; Remedies Cumulative..............................17
Section 6.11 Counterparts................................................17
Section 6.12 Headings Descriptive........................................17
Section 6.13 Severability................................................17
Section 6.14 Governing Law. .............................................17
Section 6.15 Consent to Jurisdiction. ...................................17
Section 6.16 Waiver of Jury Trial. ......................................18
Section 6.17 Entire Agreement............................................18
Section 6.18 Independent Obligations.....................................18
Section 6.19 Waiver of Defenses..........................................19
Section 6.20 Subrogation, Etc............................................19
Section 6.21 Limitation of Liability.....................................19
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Section 6.22 Collateral Agency Agreement.................................20
Schedule I - Certificates
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SECOND AMENDED AND RESTATED
PLEDGE AND SECURITY AGREEMENT
(LP Interests)
This SECOND AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT (this
"Agreement"), dated as of May 21, 1999, is made by LSP BATESVILLE HOLDING, LLC,
a Delaware limited liability company (the "Pledgor"), to THE BANK OF NEW YORK,
as collateral agent (together with its successors in such capacity, the
"Collateral Agent") for the benefit of the Senior Secured Parties pursuant to
the Second Amended and Restated Collateral Agency Agreement, dated as of May 21,
1999 (the "Collateral Agency Agreement"), among (as of the date hereof) LSP
Energy Limited Partnership (the "Partnership"), LSP Batesville Funding
Corporation (the "Funding Corporation"), the Trustee, the VEPCO L/C Agent, the
Collateral Agent, the Intercreditor Agent and the Administrative Agent.
RECITALS
WHEREAS, the Partnership was formed for the purpose of developing,
financing, constructing, owning and operating an approximately 837 MW (net)
natural gas-fired combined-cycle electric generation facility located in
Batesville, Mississippi (the "Project");
WHEREAS, the Pledgor owns 99% of the aggregate partnership
interests, and all of the limited partnership interests, in the Partnership;
WHEREAS, pursuant to the Tranche A Facility Credit Agreement, dated
as of August 28, 1998 (the "Initial Credit Agreement"), among the Partnership,
the banks and other financial institutions party thereto (the "Initial Banks")
and Credit Suisse First Boston as agent for the Initial Banks, the Initial Banks
agreed to provide loans (the "Initial Loans") to the Partnership to finance a
portion of the development, construction and start-up of the Project;
WHEREAS, in connection with the execution of the Initial Credit
Agreement, and the related financing documents, the Pledgor executed the Pledge
and Security Agreement dated as of August 28, 1998 (the "Initial LP Interests
Pledge Agreement"), in favor of IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company as collateral
agent;
WHEREAS, pursuant to the Amended and Restated Bank Facility Credit
Agreement, dated as of December 15, 1998 (the "Supplemental Credit Agreement"),
among the Partnership, the banks and other financial institutions party thereto
(the "Supplemental Banks") and Credit Suisse First Boston as agent for the
Supplemental Banks, (1) the Partnership, the Supplemental Banks and Credit
Suisse First Boston amended and restated the Initial Credit Agreement in its
entirety and (2) the Supplemental Banks agreed to provide loans (the
"Supplemental Loans") to the Partnership to finance a portion of the
development, construction and start-up of the Project;
WHEREAS, in connection with the execution of the Supplemental Credit
Agreement and the relating financing documents, and as a condition precedent to
the Supplemental Banks providing the Supplemental Loans to the Partnership, the
Pledgor and Credit Suisse First Boston, as collateral agent, executed the
Amended and Restated Pledge and Security Agreement, dated as of December 15,
1998 (the "Supplemental LP Interests Pledge Agreement") pursuant to which the
Initial LP Interests Pledge Agreement was amended and restated in its entirety;
WHEREAS, the Partnership and the Funding Corporation have determined
to issue (1) $150,000,000 aggregate principal amount of their 7.164% Series A
Senior Secured Bonds due January 15, 2014 (the "Series A Bonds") and (2)
$176,000,000 aggregate principal amount of their 8.160% Series B Senior Secured
Bonds due July 15, 2025 (the "Series B Bonds" and, together with the Series A
Bonds, the "Bonds") pursuant to the Trust Indenture, dated as of the date hereof
(the "Indenture"), among the Partnership, the Funding Corporation and The Bank
of New York, as trustee (the "Trustee").
WHEREAS, the Partnership and the Funding Corporation will use the
proceeds of the Bonds to (i) repay in full the Indebtedness outstanding under
the supplemental Credit Agreement and (ii) pay the remaining Project Cost;
WHEREAS, in connection with the issuance and sale of the Bonds and
the execution of the related Financing Documents, the Pledgor and the Collateral
Agent desire to amend and restate the Supplemental LP Interests Pledge Agreement
in its entirety.
AGREEMENT
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NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Supplemental LP Interests Pledge Agreement is hereby amended
and restated in its entirety as follows:
ARTICLE 1
DEFINITIONS; PRINCIPLES OF CONSTRUCTION
Section 1.1 Definitions. (a) Unless otherwise defined herein, terms
defined in the Indenture shall have such defined meanings when used herein.
(b) The following terms shall have the following respective
meanings:
"Default" shall have the meaning ascribed thereto in the
Intercreditor Agreement.
"Event of Default" shall have the meaning ascribed thereto in the
Intercreditor Agreement.
"Financing Statement" shall mean all financing statements,
recordings, filings or other instruments of registration necessary and
appropriate to perfect a security interest or Lien by filing in any appropriate
filing or recording office in accordance with the UCC as enacted in any and all
relevant jurisdictions or any other relevant applicable law.
"Partnership Agreement" shall mean the Second Amended and Restated
Agreement of Limited Partnership of LSP Energy Limited Partnership, dated as of
May 19, 1999, between the Pledgor and LSP Energy, Inc.
"Partnership Interests" shall have the meaning ascribed thereto in
Section 2.1(a)(i).
"Pledged Collateral" shall have the meaning ascribed thereto in
Section 2.1(a).
"Secured Obligations" shall mean the Senior Secured Obligations.
"Securities Act" shall have the meaning ascribed thereto in Section
5.2(b).
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Section 1.2 Principles of Construction. Except as otherwise expressly
provided herein, principles of construction set forth in the Indenture shall
apply to this Agreement.
ARTICLE 2
PLEDGE
Section 2.1 Pledged Collateral. (a) As collateral security for the prompt
and complete payment and performance when due, whether at stated maturity, by
acceleration or otherwise (including the payment of amounts which would become
due but for the operation of the automatic stay under Section 362(a) of the U.S.
Bankruptcy Code, 11 U.S.C. ss. 362(a)), of all of the Secured Obligations,
whether now existing or hereafter arising and howsoever evidenced, the Pledgor
hereby pledges, grants, assigns, hypothecates, transfers and delivers to the
Collateral Agent, for its benefit and the ratable benefit of the other Senior
Secured Parties, a first priority security interest in the following, whether
now existing or hereafter from time to time acquired (collectively, the "Pledged
Collateral"):
(i) all of the Pledgor's partnership interests in the
Partnership (the "Partnership Interests") and all of the Pledgor's rights
to acquire partner ship interests in the Partnership in addition to or in
exchange or substitution for the Partnership Interests;
(ii) all of the Pledgor's rights, privileges, authority and
powers as a partner in the Partnership under the Partnership Agreement;
(iii) all certificates or other documents (if any)
representing any and all of the foregoing in clauses (i) and (ii),
including, without limitation, the certificates listed on Schedule I
hereto;
(iv) all dividends, distributions, cash, securities,
instruments and other property or proceeds of any kind to which the
Pledgor may be entitled in its capacity as a partner in the Partnership by
way of distribution, return of capital or otherwise;
(v) any other claim which the Pledgor now has or may in the
future acquire in its capacity as a partner in the Partnership against the
Partnership and its property; and
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(vi) all proceeds, products and accessions of and to any of
the property described in the preceding clauses (i) through (v).
(b) As used herein, the term "proceeds" shall be construed in its
broadest sense and shall include whatever is received or receivable when any of
the Partnership Interests, or any proceeds thereof, is sold, collected,
exchanged or otherwise disposed of, whether voluntarily or involuntarily, and
shall include, without limitation, all rights to payment, including interest and
premiums, with respect to any of the Partnership Interests or any proceeds
thereof.
Section 2.2 Delivery of Certificates and Instruments. All certificates or
instruments representing or evidencing the Partnership Interests shall be
delivered to and held by or on behalf of the Collateral Agent pursuant hereto
and shall be in suitable form for transfer by delivery, or shall be accompanied
by duly executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Collateral Agent. The Collateral Agent shall have
the right, at any time following the occurrence and during the continuation of
an Event of Default, without notice to the Pledgor, to transfer to or to
register in its name or in the name of any of its nominees any or all of the
Partnership Interests. In addition, the Collateral Agent shall have the right at
any time to exchange certificates or instruments representing or evidencing any
of the Partnership Interests for certificates or instruments of smaller or
larger denominations.
Section 2.3 Pledgor's Rights.
(a) Distributions. Unless an Event of Default shall have occurred
and be continuing, the Pledgor shall be entitled to receive and retain any and
all distributions paid in respect of the Partnership Interests in compliance
with the terms of the other Transaction Documents; provided, however, that any
and all
(i) distributions paid or payable in respect of the
Partnership Interests (whether paid in cash, securities or other property)
in connection with (A) any partial or total liquidation or dissolution of
the Partnership, (B) any distribution of capital of the Partnership (but
not including distributions made (x) pursuant to Section 6.1 of the
Partnership Agreement and (y) in accordance with the Financing Documents),
(C) any recapitalization or reclassification of the capital of the
Partnership and (D) any reorganization of the Partnership, and
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(ii) property (whether cash, securities or other property)
paid, payable or otherwise distributed in redemption of, or in exchange
for, the property described in clause (i) immediately above,
shall be, and shall be forthwith delivered to the Collateral Agent to hold as,
Pledged Collateral and shall, if received by the Pledgor, be received in trust
for the benefit of the Collateral Agent, be segregated from the other property
or funds of the Pledgor, be forthwith delivered to the Collateral Agent as
Pledged Collateral in the same form as so received (with any necessary
endorsement). Upon the occurrence and during the continuance of an Event of
Default, all rights of the Pledgor to receive the distributions which it would
otherwise be authorized to receive and retain pursuant to the preceding sentence
shall cease, and all such rights shall thereupon become vested in the Collateral
Agent which shall thereupon have the sole right to receive and hold as Pledged
Collateral such distributions.
(b) Other Rights. Unless an Event of Default shall have occurred and
be continuing, the Pledgor shall be entitled to exercise all voting and other
rights with respect to the Partnership Interests; provided, however, that no
vote shall be cast, right exercised or other action taken which would knowingly
have a material adverse effect on the Pledged Collateral or which would
knowingly be inconsistent with or knowingly result in any violation of any
provision of this Agreement or any other Financing Document. Upon the occurrence
and during the continuance of an Event of Default and upon election by the
Collateral Agent, as directed by the Intercreditor Agent, acting pursuant to the
Intercreditor Agreement, all voting and other rights of the Pledgor with respect
to the Partnership Interests which the Pledgor would otherwise be entitled to
exercise pursuant to the terms of this Agreement shall cease, and all such
rights shall be vested in the Collateral Agent which shall thereupon have the
sole right to exercise such rights.
(c) Turnover. All distributions and other amounts which are received
by the Pledgor contrary to the provisions of this Agreement shall be received in
trust for the benefit of the Collateral Agent, shall be segregated from other
funds of the Pledgor and shall be forthwith paid over to the Collateral Agent as
Pledged Collateral in the same form as so received (with any necessary
endorsement).
Section 2.4 Secured Parties Not Liable. Notwithstanding any other
provision contained in this Agreement, the Pledgor shall remain liable under the
Partnership Agreement to observe and perform all of the conditions and
obligations to be observed
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and performed by the Pledgor thereunder. None of the Collateral Agent, any other
Senior Secured Party or any of their respective directors, officers, employees,
affiliates or agents shall have any obligations or liability under or with
respect to any Pledged Collateral by reason of or arising out of this Agreement,
except as set forth in Section 9-207 of the UCC as in effect from time to time
in the State of New York, or the receipt by the Collateral Agent of any payment
relating to any Pledged Collateral, nor shall any of the Collateral Agent, any
other Senior Secured Party or any of their respective directors, officers,
employees, affiliates or agents be obligated in any manner to (a) perform any of
the obligations of the Pledgor under or pursuant to the Partnership Agreements
or any other agreement to which the Pledgor is a party, (b) make any payment or
inquire as to the nature or sufficiency of any payment or performance with
respect to any Pledged Collateral, (c) present or file any claim or collect the
payment of any amounts or take any action to enforce any performance with
respect to the Pledged Collateral or (d) take any other action whatsoever with
respect to the Pledged Collateral.
Section 2.5 Attorney-in-Fact. (a) The Pledgor hereby appoints the
Collateral Agent, on behalf of the Senior Secured Parties, or any Person,
officer or agent whom the Collateral Agent may designate, as its true and lawful
attorney-in-fact and proxy, with full irrevocable power and authority in the
place and stead of the Pledgor and in the name of the Pledgor or in its own
name, at the Pledgor's cost and expense, from time to time to take any action
and to execute any instrument which may be necessary or advisable to enforce
its rights under this Agreement, including, without limitation, authority to
receive, endorse and collect all instruments made payable to the Pledgor
representing any distribution, interest payment or other payment in respect of
the Pledged Collateral or any part thereof to be paid over to the Collateral
Agent pursuant to Section 2.3(c) and to give full discharge for the same.
(b) The Pledgor hereby ratifies all that said attorney shall
lawfully do or cause to be done by virtue hereof, in each case pursuant to the
powers granted hereunder. The Pledgor hereby acknowledges and agrees that the
Collateral Agent shall have no fiduciary duties to the Pledgor and the Pledgor
hereby waives any claims or rights of a beneficiary of a fiduciary relationship
hereunder.
Section 2.6 Collateral Agent May Perform. If the Pledgor fails to perform
any agreement contained herein after receipt of a written request to do so from
the Collateral Agent, the Collateral Agent may (but shall not be obligated to)
itself perform, or cause performance of, such agreement, and the expenses of the
Collateral Agent, including the rea-
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sonable fees and expenses of its counsel, incurred in connection therewith shall
be payable by the Pledgor under Section 5.5 of the Collateral Agency Agreement,
provided that if a Bankruptcy Event shall have occurred with respect to the
Pledgor, the written request described in this Section 2.6 shall not be required
and shall be deemed to have been delivered upon the failure of the Pledgor to
perform such agreement.
Section 2.7 Reasonable Care. The Collateral Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the Pledged
Collateral in its possession if the Pledged Collateral is accorded treatment
substantially equivalent to that which the Collateral Agent accords its own
property of the type of which the Pledged Collateral consists, it being
understood that the Collateral Agent shall have no responsibility for (a)
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Pledged Collateral, whether
or not the Collateral Agent has or is deemed to have knowledge of such matters,
or (b) taking any necessary steps to preserve rights against any parties with
respect to any Pledged Collateral.
Section 2.8 Security Interest Absolute. All rights of the Collateral Agent
and security interests hereunder, and all obligations of the Pledgor hereunder,
shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any of the Financing
Documents or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Financing
Documents or any other agreement or instrument relating thereto;
(c) any exchange, release or non-perfection of any other collateral,
or any release or amendment or waiver of or consent to any departure from
any guaranty, for all or any of the Secured Obligations; or
(d) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Pledgor, except as otherwise
provided herein.
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Section 2.9 Effective as a Financing Statement. This Agreement shall also
be effective as a Financing Statement covering any Pledged Collateral and may be
filed in any appropriate filing or recording office. A carbon, photographic,
facsimile or other reproduction of this Agreement or of any Financing Statement
relating to this Agreement shall be sufficient as a Financing Statement for any
of the purposes referred to in the preceding sentence.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
The Pledgor represents and warrants, as of the date of this Agreement and
the Closing Date, as follows, which representations and warranties shall survive
the execution and delivery of this Agreement and the making and repayment of the
Secured Obligations:
Section 3.1 Necessary Filings. All filings, registrations and recordings
necessary or appropriate to create, preserve, protect and perfect the security
interest granted to the Collateral Agent hereby in respect of the Pledged
Collateral have been accomplished and the security interest granted to the
Collateral Agent pursuant to this Agreement in and to the Pledged Collateral
constitutes a valid and enforceable perfected security interest therein superior
and prior to the rights of all other Persons therein and, in each case, subject
to no other Liens, sales, assignments, conveyances, settings over or transfers
other than the Lien created pursuant to this Agreement.
Section 3.2 No Liens. The Pledgor is the owner of all of its right, title
and interest in the Pledged Collateral pledged by it hereunder free from any
Lien or other right, title or interest of any Person other than the Lien created
pursuant to this Agreement and other Permitted Liens.
Section 3.3 Other Financing Statements. There is no Financing Statement
(or similar statement or instrument of registration under the law of any
jurisdiction) executed by the Pledgor, or, to the knowledge of the Pledgor after
due inquiry, by any other Person covering or purporting to cover any interest of
any kind in the Pledged Collateral, except Financing Statements filed or to be
filed in respect of and covering the security interests granted hereby by the
Pledgor and Financing Statements filed in respect of the Supplemental LP
Interest Pledge Agreement (releases of which have been delivered to the
Collateral Agent).
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Section 3.4 Chief Executive Office. The chief executive office of the
Pledgor and the office where the Pledgor keeps its records concerning the
Pledged Collateral is located at:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇.
Section 3.5 Consents, etc. No consent, authorization, approval or other
action by, and no notice to or filing with, any governmental authority is
required either (i) for the pledge by the Pledgor of the Pledged Collateral
pursuant to this Agreement or for the due execution, delivery or performance of
this Agreement by the Pledgor, or (ii) for the exercise by the Collateral Agent
of the voting or other rights provided for in this Agreement or of the remedies
in respect of the Pledged Collateral pursuant to this Agreement, except as may
be required in connection with the disposition of the Pledged Collateral by laws
affecting the offering and sale of securities generally.
ARTICLE 4
COVENANTS
The Pledgor hereby covenants and agrees from and after the date of this
Agreement until the termination of this Agreement in accordance with the
provisions of Section 6.3:
Section 4.1 Sale of Pledged Collateral. The Pledgor shall not sell or
other wise dispose of, or grant any option or warrant with respect to, any of
the Pledged Collateral, except to the extent any such sale or disposition would
not violate the terms and provisions of the Financing Documents; provided that
any portion of the Pledged Collateral so sold or disposed of shall remain
subject to the pledge of this Agreement to the same extent as though it had not
been so sold or disposed of.
Section 4.2 No Other Liens. The Pledgor shall not create, incur or permit
to exist, shall defend the Pledged Collateral owned by it against and shall take
such other action as is reasonably necessary to remove, any Lien or claim on or
to the Pledged Collateral, other than the Lien created pursuant to this
Agreement, and shall defend the right, title and interest of the Collateral
Agent in and to the Pledged Collateral against the
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claims and demands of all Persons whomsoever, except with respect to any sale or
disposition of any of the Pledged Collateral not in violation of the Financing
Documents.
Section 4.3 Chief Executive Office. The Pledgor shall not establish a new
location for its chief executive office or change its name until (i) it has
given to the Collateral Agent not less than sixty (60) days prior written notice
of its intention so to do, clearly describing such new location or specifying
such new name, as the case may be, and (ii) with respect to such new location or
such new name, as the case may be, it shall have taken all action, necessary to
maintain the security interest of the Collateral Agent in the Pledged Collateral
intended to be granted hereby at all times fully perfected and in full force and
effect.
Section 4.4 Supplements; Further Assurances, etc. The Pledgor shall at any
time and from time to time, at the expense of the Pledgor, promptly execute and
deliver all further instruments and documents, and take all further action, that
may be necessary or desirable, or that the Collateral Agent may reasonably
request, in order to perfect and protect any security interest granted or
purported to be granted hereby or to enable the Collateral Agent to exercise and
enforce its rights and remedies hereunder with respect to any Pledged
Collateral.
Section 4.5 Amendment of Partnership Agreement. Except as permitted by the
express provisions of the Indenture, the Pledgor shall not, without the prior
written consent of the Collateral Agent, acting upon directions from (x) the
Intercreditor Agent acting pursuant to the Intercreditor Agreement or (y) the
Senior Secured Parties acting pursuant to Section 7.15 of the Intercreditor
Agreement, or as otherwise expressly provided herein, agree to or permit (a) the
cancellation or termination of the Partnership Agreement, except upon the
expiration of the stated term thereof, or (b) any amendment, supplement, or
modification of, or waiver with respect to any of the provisions of, the
Partnership Agreement. Nothing contained in this Section 4.5 shall restrict the
Pledgor's right to agree to or permit the amendment, supplement or modification
of the Partnership Agreement the sole purpose of which is to admit a new partner
into the Partnership to the extent not prohibited in the Indenture; provided
that the Pledged Collateral shall at all times remain subject to the Lien of
this Agreement.
Section 4.6 Certificates and Instruments. The Pledgor shall deliver all
certificates or other documents representing the Pledged Collateral to the
Collateral Agent with all necessary instruments of transfer or assignment duly
indorsed in blank. In the event the Pledgor obtains possession of any other
certificates, or other securities or instruments
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forming a part of the Pledged Collateral, the Pledgor shall promptly deliver
same to the Collateral Agent together with all necessary instruments of transfer
or assignment duly indorsed in blank. Prior to any such delivery, any Pledged
Collateral in the Pledgor's possession shall be held by the Pledgor in trust for
the Collateral Agent.
Section 4.7 Financing Statements. The Pledgor shall sign and deliver to
the Collateral Agent and the other Senior Secured Parties such Financing
Statements (or similar statements or instruments of registration under the law
of any jurisdiction), as are necessary or desirable to establish and maintain
the security interests contemplated hereunder as valid, enforceable, first
priority security interests as provided herein and the other rights and security
contemplated herein, all in accordance with the UCC as enacted in any and all
relevant jurisdictions or any other applicable law. The Pledgor shall pay any
applicable filing fees and related expenses. The Pledgor authorizes the
Collateral Agent to file any such Financing Statements (or similar statements or
instruments of registration under the law of any jurisdiction) without the
signature of the Pledgor.
Section 4.8 Records; Statements and Schedules. The Pledgor shall keep and
maintain, at its own cost and expense, records of the Pledged Collateral owned
by it, including, but not limited to, records of all payments received with
respect thereto, and the Pledgor shall make the same available to the Collateral
Agent for inspection at the Pledgor's chief executive office, at the Pledgor's
own cost and expense, at any and all times upon demand. The Pledgor shall
furnish to the Collateral Agent from time to time statements and schedules
further identifying and describing the Pledged Collateral and such other reports
in connection with the Pledged Collateral as the Collateral Agent may reasonably
request, all in reasonable detail.
Section 4.9 Improper Distributions. Notwithstanding any other provision
contained in this Agreement, the Pledgor shall not accept any distributions,
dividends or other payments (or any collateral in lieu thereof) in respect of
the Pledged Collateral, except to the extent the same are expressly permitted by
the terms of this Agreement and the other Financing Documents.
Section 4.10 Bankruptcy. The Pledgor shall not authorize or permit the
Partnership to (a) commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to the Partnership or
the Partnership's debts under any Bankruptcy Law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of the Partnership or any
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substantial part of the Partnership's property, (b) to consent to any such
relief or to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against the Partnership or (c)
make a general assignment for the benefit of the Partnership's creditors. The
Pledgor shall not commence or join with any other Person (other than the
Collateral Agent and the other Senior Secured Parties) in commencing any
proceeding against the Partnership under any Bankruptcy Law now or hereafter in
effect in any jurisdiction.
ARTICLE 5
EXERCISE OF REMEDIES UPON AN EVENT OF DEFAULT
The provisions of this Article 5 shall apply only upon the occurrence and
during the continuance of an Event of Default.
Section 5.1 Remedies Generally. If an Event of Default shall have occurred
and be continuing, the Collateral Agent, upon directions from (x) the
Intercreditor Agent acting pursuant to the Intercreditor Agreement or (y) the
Senior Secured Parties acting pursuant to Section 7.15 of the Intercreditor
Agreement, or as otherwise expressly provided herein, may exercise, in addition
to all other rights and remedies granted in this Agreement and in any other
instrument or agreement securing, evidencing or relating to the Secured
Obligations, all rights and remedies of a secured party under the UCC in effect
from time to time in any relevant jurisdiction and all other rights and remedies
available at law or in equity.
Section 5.2 Sale of Pledged Collateral. (a) Without limiting the
generality of Section 5.1, the Collateral Agent, upon directions from (x) the
Intercreditor Agent acting pursuant to the Intercreditor Agreement or (y) the
Senior Secured Parties acting pursuant to Section 7.15 of the Intercreditor
Agreement, or as otherwise expressly provided herein, may, without notice except
as specified below, sell the Pledged Collateral or any part thereof in one or
more parcels at public or private sale or at any of the Collateral Agent's
corporate trust office or elsewhere, for cash, on credit or for future delivery,
and at such price or prices and upon such other terms as is commercially
reasonable, irrespective of the impact of any such sales on the market price of
the Pledged Collateral at any such sale. Each purchaser at any such sale shall
hold the property sold absolutely, free from any claim or right on the part of
the Pledgor, and the Pledgor hereby waives (to the extent permitted by law) all
rights of redemption, stay and/or appraisal which it now has or may at any time
in the future have under any rule of law or statute now existing or hereafter
enacted. The
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Pledgor agrees that, to the extent notice of sale shall be required by law, at
least ten (10) days' notice to the Pledgor of the time and place of any public
sale or the time after which any private sale is to be made shall constitute
reasonable notification. The Collateral Agent shall not be obligated to make any
sale of Pledged Collateral regardless of notice of sale having been given. The
Collateral Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned. The
Collateral Agent shall incur no liability as a result of the sale of the Pledged
Collateral, or any part thereof, at any public or private sale. The Pledgor
hereby waives any claims against the Collateral Agent arising by reason of the
fact that the price at which any Pledged Collateral may have been sold at such a
private sale, if commercially reasonable, was less than the price which might
have been obtained at a public sale, even if the Collateral Agent accepts the
first offer received and does not offer the Pledged Collateral to more than one
offeree.
(b) The Pledgor recognizes that the Collateral Agent, upon
directions from (x) the Intercreditor Agent acting pursuant to the Intercreditor
Agreement or (y) the Senior Secured Parties acting pursuant to Section 7.15 of
the Intercreditor Agreement, or as otherwise expressly provided herein, may
elect to sell all or any part of the Pledged Collateral to one or more
purchasers in privately negotiated transactions in which the purchasers will be
obligated to agree, among other things, to acquire the Pledged Collateral for
their own account, for investment and not with a view to the distribution or
resale thereof. The Pledgor acknowledges that any such private sales may be at
prices and on terms less favorable than those obtainable through a public sale
(including, without limitation, a public offering made pursuant to a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act")), and the Pledgor and the Collateral Agent agree that such
private sales shall be made in a commercially reasonable manner and that the
Collateral Agent has no obligation to engage in public sales and no obligation
to delay sale of any Pledged Collateral to permit the issuer thereof to register
the Pledged Collateral for a form of public sale requiring registration under
the Securities Act. If the Collateral Agent, upon directions from (x) the
Intercreditor Agent acting pursuant to the Intercreditor Agreement or (y) the
Senior Secured Parties acting pursuant to Section 7.15of the Intercreditor
Agreement, or as otherwise expressly provided herein, determines to exercise its
right to sell any or all of the Pledged Collateral, upon written request, the
Pledgor shall, from time to time, furnish to the Collateral Agent all such
information as is necessary in order to determine the number of shares and other
instruments included in the Pledged Collateral which may be sold by the
Collateral Agent as exempt transactions under the Securities Act
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and rules of the Securities and Exchange Commission thereunder, as the same are
from time to time in effect.
Section 5.3 Purchase of Pledged Collateral. The Collateral Agent may be a
purchaser of the Pledged Collateral or any part thereof or any right or interest
therein at any sale thereof, whether pursuant to foreclosure, power of sale or
otherwise hereunder and the Collateral Agent may apply the purchase price to the
payment of the Secured Obligations. Any purchaser of all or any part of the
Pledged Collateral shall, upon any such purchase, acquire good title to the
Pledged Collateral so purchased, free of the security interests created by this
Agreement.
Section 5.4 Application of Proceeds. The Collateral Agent shall apply any
proceeds from time to time held by it and the net proceeds of any collection,
recovery, receipt, appropriation, realization or sale with respect to the
Pledged Collateral in accordance Article IV of the Collateral Agency Agreement.
For avoidance of doubt, it is understood that the Partnership and the Funding
Corporation shall remain liable to the extent of any deficiency between the
amount of proceeds of the Pledged Collateral and the aggregated amount of the
Secured Obligations in accordance with the Financing Documents.
ARTICLE 6
MISCELLANEOUS PROVISIONS
Section 6.1 Notices. Unless otherwise specifically herein provided, all
notices required or permitted under the terms and provisions hereof shall be in
writing and any such notice shall become effective if given in accordance with
the provisions of Section 1.4 of the Indenture (and, in the case of notice to
the Pledgor, addressed to the Pledgor's chief executive office as determined
herein).
Section 6.2 Continuing Security Interest. This Agreement shall create a
continuing security interest in the Pledged Collateral until the release thereof
pursuant to Section 6.3.
Section 6.3 Release. Upon the indefeasible payment in full of the Secured
Obligations in cash or cash equivalents and the termination of all commitments
of the Senior Secured Parties under the Financing Documents, the Collateral
Agent, upon the request, and at the expense, of the Pledgor, and acting pursuant
to direction from the
15
Pledgor, shall execute and deliver all such documentation as the Pledgor may
request to release the security interest created pursuant to this Agreement.
Section 6.4 Reinstatement. This Agreement shall continue to be effective
or be reinstated, as the case may be, if at any time any amount received by the
Collateral Agent or any other Senior Secured Party hereunder or pursuant hereto
is rescinded or must otherwise be restored or returned by the Collateral Agent
or such Senior Secured Party upon a Bankruptcy Event of the Pledgor, the
Partnership or the Funding Corporation or upon the appointment of any intervenor
or conservator of, or trustee or similar official for, the Pledgor, the
Partnership or the Funding Corporation or any substantial part of the Pledgor's,
the Partnership's or the Funding Corporation's assets, or upon the entry of an
order by any court avoiding the payment of such amount, or otherwise, all as
though such payments had not been made.
Section 6.5 Independent Security. The security provided for in this
Agreement shall be in addition to and shall be independent of every other
security which the Senior Secured Parties may at any time hold for any of the
Secured Obligations hereby secured, whether or not under the Senior Security
Documents. The execution of any other Senior Security Document shall not modify
or supersede the security interest or any rights or obligations contained in
this Agreement and shall not in any way affect, impair or invalidate the
effectiveness and validity of this Agreement or any term or condition hereof.
The Pledgor hereby waives its right to plead or claim in any court that the
execution of any other Senior Security Document is a cause for extinguishing,
invalidating, impairing or modifying the effectiveness and validity of this
Agreement or any term or condition contained herein. The Collateral Agent shall
be at liberty to accept further security from the Pledgor or from any third
party and/or release such security without notifying the Pledgor and without
affecting in any way the obligations of the Pledgor under the Senior Security
Documents or the other Financing Documents. The Collateral Agent, upon
directions from (x) the Intercreditor Agent acting pursuant to the Intercreditor
Agreement or (y) the Senior Secured Parties acting pursuant to Section 7.15 of
the Intercreditor Agreement, or as otherwise expressly provided herein, shall
determine if any security conferred upon the Collateral Agent under the Senior
Security Documents shall be enforced by the Collateral Agent, as well as the
sequence of securities to be so enforced.
Section 6.6 Amendments. No waiver, amendment, modification or termination
of any provision of this Agreement, or consent to any departure by the Pledgor
therefrom, shall in any event be effective without the prior written consent of
the Collateral Agent,
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acting upon directions from (x) the Intercreditor Agent acting pursuant to the
Intercreditor Agreement or (y) the Senior Secured Parties acting pursuant to
Section 7.15 of the Intercreditor Agreement, or as otherwise expressly provided
herein, and none of the Pledged Collateral shall be released without the written
consent of the Collateral Agent, acting upon directions from (x) the
Intercreditor Agent acting pursuant to the Intercreditor Agreement or (y) the
Senior Secured Parties acting pursuant to Section 7.15 of the Intercreditor
Agreement, or as otherwise expressly provided herein. Any such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
Section 6.7 Successors and Assigns. This Agreement shall be binding upon
the Pledgor and its successors and assigns and shall inure to the benefit of the
Collateral Agent and the other Senior Secured Parties and their respective
successors and assigns. The Pledgor may not assign or otherwise transfer any of
its rights or obligations under this Agreement without the written consent of
the Collateral Agent, acting upon directions from (x) the Intercreditor Agent
acting pursuant to the Intercreditor Agreement or (y) the Senior Secured Parties
acting pursuant to Section 7.15 of the Intercreditor Agreement, or as otherwise
expressly provided herein; provided that the obligations of the Pledgor
hereunder shall be equally binding on any transferee of the Pledgor (or its
successors) with respect to the Pledged Collateral.
Section 6.8 Third Party Beneficiaries. The agreements of the parties
hereto are intended to benefit the Senior Secured Parties and their respective
successors and assigns.
Section 6.9 Survival. All agreements, statements, representations and
warranties made by the Pledgor herein or in any certificate or other instrument
delivered by the Pledgor or on its behalf under this Agreement shall be
considered to have been relied upon by the Collateral Agent and the other Senior
Secured Parties and shall survive the execution and delivery of this Agreement
and the other Financing Documents until termination thereof or the indefeasible
payment in full in cash or cash equivalents of all of the Secured Obligations
and the termination of all commitments of the Senior Secured Parties under the
Financing Documents regardless of any investigation made by the Collateral Agent
or the other Senior Secured Parties or made on their behalf.
Section 6.10 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Collateral Agent in exercising any right, power or privilege
hereunder and no course of dealing between the Pledgor and the Collateral Agent
shall operate as a waiver thereof;
17
nor shall any single or partial exercise of any right, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder. The rights and remedies
herein expressly provided are cumulative and not exclusive of any rights or
remedies which the Collateral Agent would otherwise have.
Section 6.11 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
Section 6.12 Headings Descriptive. The headings of the several Sections
and subsections of this Agreement are inserted for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Agreement.
Section 6.13 Severability. In case any provision contained in or
obligation under this Agreement shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
Section 6.14 Governing Law. This Agreement shall be governed by the laws
of the State of New York of the United States of America and shall for all
purposes be governed by and construed in accordance with the laws of such state
without regard to the conflict of law rules thereof other than Section 5-1401 of
the New York General Obligations Law.
Section 6.15 Consent to Jurisdiction. Any legal action or proceeding by or
against the Pledgor with respect to or arising out of this Agreement may be
brought in or removed to the courts of the State of New York, in and for the
County of New York, or of the United States of America for the Southern District
of New York. By execution and delivery of this Agreement, the Pledgor accepts,
for itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts for legal proceedings arising out of or in
connection with this Agreement and irrevocably consents to the appointment of CT
Corporation System, with offices on the date hereof at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its agent to receive service of process in New York, New
York. If for any reason such agent shall cease to be available to act as such,
the Pledgor agrees to appoint a new agent on the terms and for the purposes of
this
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provision. Nothing herein shall affect the right to serve process in any other
manner permitted by law or any right to bring legal action or proceedings in any
other competent jurisdiction, including judicial or non-judicial foreclosure of
real property interests which are part of the Pledged Collateral. The Pledgor
further agrees that the aforesaid courts of the State of New York and of the
United States of America for the Southern District of New York shall have
exclusive jurisdiction with respect to any claim or counterclaim of the Pledgor
based upon the assertion that the rate of interest charged by or under this
Agreement or under the other Financing Documents is usurious. The Pledgor hereby
waives any right to stay or dismiss any action or proceeding under or in
connection with the Project, this Agreement or any other Transaction Document
brought before the foregoing courts on the basis of forum non-conveniens or
improper venue.
Section 6.16 Waiver of Jury Trial. EACH OF THE PLEDGOR AND THE COLLATERAL
AGENT HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OF THE
OTHER PARTIES HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE COLLATERAL
AGENT TO ENTER INTO THIS AGREEMENT.
Section 6.17 Entire Agreement. This Agreement, together with any other
agreement executed in connection herewith, is intended by the parties as a final
expression of their agreement as to the matters covered hereby and is intended
as a complete and exclusive statement of the terms and conditions thereof.
Section 6.18 Independent Obligations. The Pledgor's obligations under this
Agreement are independent of those of the Partnership and the Funding
Corporation. The Collateral Agent may bring a separate action against the
Pledgor without first proceeding against the Partnership, the Funding
Corporation or any other Person or any other security held by the Collateral
Agent and without pursuing any other remedy.
Section 6.19 Waiver of Defenses. The Pledgor hereby waives: (a) any
defense of a statute of limitations; (b) any defense based on the legal
disability of the Partnership or the Funding Corporation or any discharge or
limitation of the liability of the Partnership or the Funding Corporation to the
Collateral Agent or the Senior Secured Parties, whether
19
consensual or arising by operation of law; (c) presentment, demand, protest and
notice of any kind (other than as expressly provided by the Financing
Documents); and (d) any defense based upon or arising out of any defense which
the Partnership or the Funding Corporation may have to the payment or
performance of any part of the Secured Obligations.
Section 6.20 Subrogation, Etc. Notwithstanding any payment or payments
made by the Pledgor or the exercise by the Collateral Agent of any of the
remedies provided under this Agreement or any other Financing Document, until
the Secured Obligations have been indefeasibly paid in full in cash or cash
equivalents and all commitments of the Senior Secured Parties under the
Financing Documents shall have terminated, the Pledgor shall have no claim (as
defined in 11 U.S.C. ss. 101(5)) of subrogation to any of the rights of the
Collateral Agent against the Partnership, the Funding Corporation, the Pledged
Collateral or any guaranty held by the Collateral Agent for the satisfaction of
any of the Secured Obligations, nor shall the Pledgor have any claims (as
defined in 11 U.S.C. ss. 101(5)) for reimbursement, indemnity, exoneration or
contribution from the Partnership or the Funding Corporation in respect of
payments made by the Pledgor hereunder. Notwithstanding the foregoing, if any
amount shall be paid to the Pledgor on account of such subrogation,
reimbursement, indemnity, exoneration or contribution rights at any time, such
amount shall be held by the Pledgor in trust for the Collateral Agent segregated
from other funds of the Pledgor, and shall be turned over to the Collateral
Agent in the exact form received by the Pledgor (duly endorsed by the Pledgor to
the Collateral Agent if required) to be applied against the Secured Obligations
in such amounts and in such order as the Collateral Agent, upon directions from
(x) the Intercreditor Agent acting pursuant to the Intercreditor Agreement or
(y) the Senior Secured Parties acting pursuant to Section 7.15 of the
Intercreditor Agreement, or as otherwise expressly provided herein, may elect.
Section 6.21 Limitation of Liability. The provisions of Section 14.1 of
the Indenture shall apply to this Agreement.
Section 6.22 Collateral Agency Agreement. The rights, benefits, privileges
and immunities given to the Collateral Agent and set forth in the Collateral
Agency Agreement are expressly incorporated herein by reference thereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Pledge and Security Agreement to be duly executed and delivered by
their officers thereunto duly authorized as of the date first above written.
LSP BATESVILLE HOLDING, LLC
By: LS Power Management, LLC,
its manager
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Secretary
THE BANK OF NEW YORK
not in its individual capacity but
solely as Collateral Agent
By: /s/ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Vice President
Signature Page to Second Amended and Restated LP Pledge Agreement
Schedule I
CERTIFICATES
Certificate No. 3 representing a 99% interest in LSP Energy Limited Partnership.
