Exhibit 99.7
BANKERS TRUST COMPANY
EXCHANGE AGENT AGREEMENT
[ ], 2002
Bankers Trust Company
Corporate Trust and Agency Group
Four Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Reorganization Unit
Ladies and Gentlemen:
Cedar Brakes II, L.L.C., a Delaware limited liability company (the
"Company"), is offering to exchange (the "Exchange Offer") its 9.875% Series A
Senior Secured Bonds due 2013 (the "Series A Bonds") for an equal principal
amount of its registered 9.875% Series B Senior Secured Bonds due 2013 (the
"Series B bonds" and, together with the Series A Bonds, the "bonds"), pursuant
to a prospectus (the "Prospectus") included in the Company's Registration
Statement on Form S-4 (Reg. No. 333-[ ]) as amended (the "Registration
Statement"), filed with the Securities and Exchange Commission (the "SEC") and
attached hereto as Exhibit A. The Term "Expiration Date" shall mean 5:00 p.m.,
New York City time, on [ ], 2002, unless the Exchange Offer is extended as
provided in the Prospectus, in which case the term "Expiration Date" shall mean
the latest date and time to which the Exchange Offer is extended. Upon execution
of this Agreement, Bankers Trust Company will act as the Exchange Agent for the
Exchange Offer (the "Exchange Agent"). Capitalized terms used and not otherwise
defined herein shall have the respective meanings ascribed thereto in the
Prospectus.
A copy of each of the form of letter of transmittal (the "Letter of
Transmittal"), the form of the notice of guaranteed delivery (the "Notice of
Guaranteed Delivery"), the form of letter to holders of Series A bonds (each, a
"Holder" and, collectively, the "Holders") and the form of letter to clients
(collectively, the "Tender Documents") to be used by Holders of Series A bonds
in order to receive Series B bonds pursuant to the Exchange Offer are attached
hereto as Exhibit B.
The Company hereby appoints you to act as Exchange Agent in connection
with the Exchange Offer. In carrying out your duties as Exchange Agent, you are
to act in accordance with the following provisions of this Agreement:
1. You are to mail the Prospectus and the Tender Documents to all of
the Holders and participants on the day that you are notified by the Company
that the Registration Statement has become effective under the Securities Act of
1933, as amended, or as soon as practicable thereafter, and to make subsequent
mailings thereof as soon as practicable after the date of any amendment thereof
and to any persons who become Holders prior to the Expiration Date and to
any persons as may from time to time be requested by the Company. All mailings
pursuant to this Section 1 shall be by first class mail, postage prepaid, unless
otherwise specified by the Company. You shall also accept and comply with
telephone requests for information relating to the Exchange Offer, provided that
such information shall relate only to the procedures for tendering Series A
bonds in (or withdrawing tenders of Series A bonds from) the Exchange Offer and
provided that such information shall relate only to the procedures for tendering
old bonds in (or withdrawing tenders of Series A bonds from) the Exchange Offer.
All other requests for information relating to the Exchange Offer shall be
directed to the Company, Attention: [Xxxxx Xxxxxxx, Esq.], 0000 Xxxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxx 00000.
2. You are to examine Letters of Transmittal and the Series A bonds and
other documents delivered or mailed to you, by or for the Holders, prior to the
Expiration Date, to ascertain whether (i) the Letters of Transmittal are
properly executed and completed in accordance with the instructions set forth
therein, (ii) the Series A bonds are in proper form for transfer and (iii) all
other documents submitted to you are in proper form. In each case where a Letter
of Transmittal or other document has been improperly executed or completed or ,
for any other reason, is not in proper form, or some other irregularity exists,
you are authorized to endeavor to take such action as you consider appropriate
to notify the tendering Holder of such irregularity and as to the appropriate
means of resolving the same. Determination of questions as to the proper
completion or execution of the Letters of Transmittal, or as to the proper form
for transfer of the Series A bonds or as to any other irregularity in connection
with the submission of Letters of Transmittal and/or Series A bonds and other
documents in connection with the Exchange Offer, shall be made by the officers
of, or counsel for, the Company at their written instructions or oral direction
confirmed by facsimile. Any determination made by the Company on such questions
shall be final and binding.
3. At the written request of the Company or its counsel, Xxxxxxxxxx &
Xxxxx LLP, you shall notify tendering Holders of Series A bonds of the
termination of the Exchange Offer and, in the event of any such termination, you
will return all tendered Series A bonds to the persons entitled thereto, at the
request of the Company or its counsel, Xxxxxxxxxx & Xxxxx LLP, at the expense of
the Company.
4. Tender of the Series A bonds may be made only as set forth in the
Letter of Transmittal. Notwithstanding the foregoing, tenders which the Company
shall approve in writing as having been properly delivered shall be considered
to be properly tendered. Letters of Transmittal and Notices of Guaranteed
Delivery shall be recorded by you as to the date and time of receipt and shall
be preserved and retained by you at the Company's expense for one year. Series B
bonds are to be issued in exchange for Series A bonds pursuant to the Exchange
Offer only (i) against deposit with you prior to the Expiration Date or, in the
case of a tender in accordance with the guaranteed delivery procedures outlined
in Instruction 2 of the Letter of Transmittal, within three New York Stock
Exchange trading days after the Expiration Date of the Exchange Offer, together
with executed Letters of Transmittal and other documents required by the
Exchange Offer or (ii) in the event that the Holder is a participant in the
Depository Trust
2
Company ("DTC") system, by the utilization of DTC's Automated Tender Offer
Program ("ATOP") and any evidence required by the Exchange Offer.
You are hereby directed to establish an account with respect to the
bonds at The Depositary Trust Company (the "Book Entry Transfer Facility")
within two days after the date hereof in accordance with SEC Regulation
240.17Ad. Any financial institution that is a participant in the Book Entry
Transfer Facility system may, until the Expiration Date, make book-entry
delivery of the Series A bonds by causing the Book Entry Facility to transfer
such bonds into your account in accordance with the procedure for such transfer
established by the Book Entry Transfer Facility. In every case, however, a
Letter of Transmittal (or a manually executed facsimile thereof), or an Agent's
Message (as defined in the Prospectus), properly completed and duly executed,
with any required signature guarantees and any other required documents must be
transmitted to and received by you prior to the Expiration Date, or the
guaranteed delivery procedures described in the Prospectus must be complied
with.
5. Upon oral or written request of the Company (with written
confirmation of any such oral request thereafter), you will transmit by
telephone, and promptly thereafter confirm in writing to the Company's counsel,
Xxxxxxxxxx & Xxxxx LLP, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: A. Xxxxxx Xxxxx, Esq. (Tel: (000) 000-0000, Fax: (000) 000-0000), or
such other persons as the Company may reasonably request, the aggregate number
and principal amount of Series A bonds tendered to you and the number and
principal amount of Series A bonds properly tendered that day. In addition, you
will also inform the aforementioned persons, upon oral request made from time to
time (with written confirmation of such request thereafter) prior to the
Expiration Date, of such information as they or any of them may reasonable
request.
6. Upon the terms and subject to the conditions of the Exchange Offer,
delivery of Series B bonds will be made by you promptly after acceptance of the
tendered Series A bonds. You will hold all items that are deposited for tender
with you after 5:00 p.m. New York City time, on the Expiration Date, pending
further instructions from an officer of the Company.
7. If any Holder shall report to you that his or her failure to
surrender Series A bonds registered in his or her name is due to the loss or
destruction of a certificate or certificates, you shall request that such Holder
(i) furnish to you an affidavit of loss and, if required by the Company, a bond
of indemnity in an amount, and evidenced by such certificate or certificates of
a surety, as may be satisfactory to you and the Company, and (ii) execute and
deliver an agreement to indemnify the Company and you in such form as is
acceptable to you and the Company. The obligees to be named in each such
indemnity bond shall include the Company and you. You shall report to the
Company the names of all Holders who claim that their Series A bonds have been
lost or destroyed and the principal amount of such Series A bonds.
8. As soon as practicable after the Expiration Date, you shall mail or
deliver via the Book Entry Transfer Facility's applicable procedures, the Series
B bonds that such Holders may
3
be entitled to receive and you shall arrange for cancellation of the Series A
bonds submitted to you or returned by DTC in connection with ATOP. Such Series A
bonds shall be forwarded to you for cancellation and retirement as you are
instructed by the Company (or a representative designated by the Company) in
writing.
9. Letters of Transmittal, book-entry confirmations and Notices of
Guaranteed Delivery received by you shall be preserved by you for a period of
time at least equal to the period of time you preserve other records pertaining
to the transfer of securities, or one year, whichever is longer, and thereafter
shall be delivered by you to the Company. You shall dispose of unused Letters of
Transmittal and other surplus materials as instructed by the Company.
10. For your services as the Exchange Agent hereunder, the Company
shall pay you in accordance with the schedule of fees attached hereto as Exhibit
C. The Company also will reimburse you for your reasonable out-of-pocket
expenses (including, but not limited to, reasonable attorneys' fees not
previously paid to you as set forth in Exhibit C) in connection with your
services promptly after submission to the Company of itemized statements.
11. You are not authorized to pay any concessions, commissions or
solicitation fees to any broker, dealer, bank or other person or to engage or
utilize any person to solicit tenders.
12. As the Exchange Agent hereunder you:
(a) shall have no duties or obligations other than those
specifically set forth herein or in the Exhibits attached hereto or as
may be subsequently requested in writing of you by the Company and
agreed to by you in writing with respect to the Exchange Offer;
(b) will be regarded as making no representations and having
no responsibilities as to the validity, accuracy, sufficiency, value or
genuineness of any Series A bonds deposited with you hereunder, any
Series B bonds, and Tender Documents or other documents prepared by the
Company in connection with the Exchange Offer;
(c) shall not be obligated to take any legal action hereunder
which might in your judgment involve any expense or liability unless
you shall have been furnished with an indemnity reasonably satisfactory
to you;
(d) may rely on, and shall be fully protected and indemnified
as provided in Section 13 hereof in acting upon, the written or oral
instructions with respect to any matter relating to your acting as
Exchange Agent specifically covered by this Agreement or supplementing
or qualifying any such action of any officer or agent of the Company or
of such other person or persons as may be designated or whom you
reasonably believe have been designated by the Company;
4
(e) may consult with counsel satisfactory to you, including
counsel for the Company, and the advice of such counsel shall be full
and complete authorization and protection in respect of any action
taken, suffered or omitted by you in good faith and in accordance with
such advice of such counsel;
(f) shall not at any time advise any person as to the wisdom
of the Exchange Offer or as to the market value or decline or
appreciation in market value of any Series A bonds or Series B bonds;
and
(g) shall not be liable for any action which you may do or
refrain from doing in connection with this Agreement except for your
gross negligence, willful misconduct or bad faith.
13. The Company covenants and agrees to indemnify and hold harmless
Bankers Trust Company and its officers, directors, employees, agents and
affiliates (collectively, the "Indemnified Parties" and each an "Indemnified
Party") against any loss, liability or reasonable expense of any nature
(including reasonable attorneys' and other fees and expenses) incurred in
connection with the administration of the duties of the Indemnified Parties
hereunder in accordance with this Agreement; provided, however, such Indemnified
Party shall use its best efforts to notify the Company by letter, or by cable,
telex or telecopier confirmed by letter, of the written assertion of a claim
against such Indemnified Party, or of any action commenced against such
Indemnified Party, promptly after but, in any event, within 5 business days of
the date such Indemnified Party shall have received any such written assertion
of a claim or shall have been served with a summons or other legal process,
giving information as to the nature and basis of the claim; provided, however,
that failure to so notify the Company shall not relieve the Company of any
liability which it may otherwise have hereunder, except such liability as is a
direct result of such Indemnified Party's failure to so notify the Company. The
Company shall be entitled to participate, at its own expense, in the defense of
any such claim or legal action and, if the Company so elects or if the
Indemnified Party in such notice to the Company so directs, the Company may
assume the defense of any pending or threatened action against such Indemnified
Party in respect of which indemnification may be sought hereunder, in which case
the Company shall not thereafter be responsible for the subsequently-incurred
fees and disbursements of legal counsel for such Indemnified Party under this
paragraph so long as the Company shall retain counsel satisfactory to such
Indemnified Party to defend such suit; provided, that the Company shall not be
entitled to assume the defense of any such action if the named parties to such
action include both an Indemnified Party and the Company and the representation
of both parties by the same legal counsel would, in the written opinion of
counsel for the Indemnified Party, be inappropriate due to actual or potential
conflicting interests between the Indemnified Party and the Company. You
understand and agree that the Company shall not be liable under this paragraph
for the fees and expenses of more than one legal counsel for all Indemnified
Parties; provided, that, (i) the Company does not retain counsel satisfactory to
you to defend such suit or (ii) upon the advise of counsel, there exists a
defense available to you that is not otherwise available to the Company and you
have determined in your reasonable judgment, that a conflict of interest exists
between you and the Company, in the event there is a conflict of interest
between the Indemnified Party and the Company, the Company shall pay the
reasonable legal fees for no more than one separate
5
legal counsel for the Indemnified Party. Except as set forth herein, you shall
be entitled to retain counsel of your choice in any suit and the Company shall
pay the fees, expenses and disbursements of such counsel. You shall not enter
into a settlement or other compromise with respect to any indemnified loss,
liability or expense without the prior written consent of the Company, which
shall not be unreasonably withheld or delayed if not adverse to the Company's
interests.
14. This Agreement and your appointment as the Exchange Agent shall be
construed and enforced in accordance with the laws of the State of New York and
shall inure to the benefit of, and the obligations created hereby shall be
binding upon, the successors and assigns of the parties hereto. No other person
shall acquire or have any rights under or by virtue of this Agreement.
15. The parties hereto hereby irrevocably submit to the venue and
jurisdiction of any New York State or federal court sitting in the Borough of
Manhattan in New York City in any action or proceeding arising out of or
relating to this Agreement, and the parties hereby irrevocably agree that all
claims in respect of such action or proceeding arising out of or relating to
this Agreement, shall be heard and determined in such a New York State or
federal court. The parties hereby consent to and grant to any such court
jurisdiction over the persons of such parties and over the subject matter of any
such dispute and agree that delivery or mailing of any process or other papers
in the manner provided herein, or in such other manner as may be permitted by
law, shall be valid and sufficient service thereof.
16. This Agreement may not be modified, amended or supplemented without
an express written agreement executed by the parties hereto. Any inconsistency
between this Agreement and the Tender Documents, as they may from time to time
be supplemented or amended, shall be resolved in favor of the latter, except
with respect to the duties, liabilities and indemnification of you as Exchange
Agent.
17. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original and all of which, taken together, shall
constitute one and the same agreement.
18. In case any provision of this Agreement shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
19. Unless terminated earlier by the parties hereto, this Agreement
shall terminate 90 days following the Expiration Date. Notwithstanding the
foregoing, Sections 9, 10 and 13 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver to
the Trustee any certificates for Series A bonds or Series B bonds, funds or
property then held by you as Exchange Agent under this Agreement.
6
20. All notices and communications hereunder shall be in writing and
shall be deemed to be duly given if delivered or mailed first class certified or
registered mail, postage prepaid, or telecopied as follows:
If to the Company: Cedar Brakes II, L.L.C.
c/o El Paso Corporation
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Telecopier No: (000) 000-0000
Attn: Xxxxx Xxxxxxx, Esq.
and a copy to: Xxxxxxxxxx & Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopier No.: (000) 000-0000
Attn: A. Xxxxxx Xxxxx
If to you: Bankers Trust Company
Corporate Trust and Agency Group
Four Albany Street - 4th Floor
New York, New York 10006
Attn.: Xxxxxxxxx Xxx Xxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
or such other address or telecopy number as any of the above may have furnished
to the other parties in writing for such purposes.
21. This Letter Agreement and all of the obligations hereunder shall be
assumed by any and all successors and assigns of the Company.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
7
If the foregoing is in accordance with your understanding, would you
please indicate your agreement by signing and returning the enclosed copy of
this Agreement to the Company.
Very truly yours,
CEDAR BRAKES II, L.L.C.
By:_______________________________
Name:
Title:
Agreed to this [ ] day of [ ], 2002
BANKERS TRUST COMPANY, as Exchange Agent
By:_______________________________
Name:
Title:
8
EXHIBIT A
REGISTRATION STATEMENT
[To be inserted]
9
EXHIBIT B
FORM OF LETTER OF TRANSMITTAL, FORM OF NOTICE OF GUARANTEED DELIVERY,
FORM OF LETTER TO HOLDERS, FORM OF LETTER TO CLIENTS
10
EXHIBIT C
BANKERS TRUST COMPANY
CORPORATE TRUST AND AGENCY GROUP
SCHEDULE OF FEES
EXCHANGE AGENT ACCEPTANCE FEES: $5000.00
Covers review of the Exchange Agent Agreement, the Letter of
Transmittal and other related documentation; establishment of accounts and
systems link with depositories; operational and administrative charges and time
spent in connection with the review, receipt and processing of Letters of
Transmittal, and Agent's Messages (as defined in the Prospectus).
NOTE: The fees set forth in this schedule are subject to review of
documentation. The fees are also subject to change should circumstances warrant.
Out-of-pocket expenses and disbursements, including counsel fees, incurred in
the performance of our duties will be added to the billed fees. Fees for any
services not covered in this or related schedules will be based upon our
appraisal of the services rendered.
We may place orders to buy/sell financial instruments with outside
broker-dealers that we select, as well as with BT or its affiliates. These
transactions (for which normal and customary spreads or other compensation may
be earned by such broker-dealers, including BT or its affiliates, in addition to
the charges quoted above) will be executed on a riskless principal basis solely
for your account(s) and without recourse to us or our affiliates. If you choose
to invest in any mutual fund, BT and/or our affiliates may earn investment
management fees and other service fees/expenses associated with these funds as
disclosed in the mutual fund prospectus provided to you, in addition to the
charges quoted above. Likewise, BT has entered into agreements with certain
mutual funds or their agents to provide shareholder services to those funds. For
providing these shareholder services, BT is paid a fee by these mutual funds
that, calculated on an annual basis, does not exceed 25 basis points of the
amount of your investment in these mutual funds. In addition, if you choose to
use other services provided by BT or its affiliates, Corporate Trust or other BT
affiliates may be allocated a portion of the fees earned. We will provide
periodic account statements describing transactions executed for your
account(s). Trade confirms will be available upon your request at no additional
charge. If a transaction should fail to close for reasons beyond our control, we
reserve the right to charge our acceptance fee plus reimbursement for legal fees
incurred.
Shares of mutual funds are not deposits or obligations of, or
guaranteed by, Bankers Trust Company or any of its affiliates and are not
insured by the Federal Deposit Insurance Corporation or any other agency of the
U.S. Government. Investments in the mutual funds involve the possible loss of
principal. Please read the prospectus carefully before investing.
11
