TRUST
AND RETENTION AGREEMENT [CD1]
THIS AGREEMENT is made on the……………day
of………….2000 between:
(1) ABC
Power Generation company Limited, a company registered under Companies
Act,
1956 (1) of 1956, having its registered office at .............................
Mumbai, State of Maharashtra (hereinafter referred to as the
"Borrower" which expression shall. unless it be repugnant to the
subject or context thereof, include its successors and assigns);
(2) XYZ
Finance Company Limited (XYZF), a company registered under the Companies
Act,
1956 and having its registered office at "
....................................... Mumbai as security trustee for the
Lenders/Lead Institution (hereinafter referred to as the "Security
Trustee/Lead Institution which expression shall, unless it be repugnant to the
subject or context thereof, include its successors and assigns); and
(3) ABC
Bank (ABCB), a banking company within the meaning of the Banking Regulation
Act, 1949 (the "Account Bank") and GHI Bank Limited (GHIB), a banking
company within the meaning of the Banking Regulation Act, 1949 (the
"Account Bank") ABC and GHI collectively referred to as Account Banks
which expression shall, unless it be repugnant to the subject or context
thereof, include their successors and assigns
NOW IT IS AGREED BETWEEN THE
PARTIES as follows:
1. Definitions and
construction
1. 1
Definitions
"Acceptance Date" means
the date on which the Lenders' Engineer certifies to the Borrower that the
performance and guarantee tests In relation to the Plant have been successfully
completed in accordance with the EPC Contract and the Performance Acceptance
Tests as specified in Schedule F to the PPA have been successfully completed;
"Account" means
each of the Trust and Retention Account, the PPA Collection Account, the Dollar
Construction Account, the Current Debt Service Accounts, the Commitment Charges
Guarantee Account, the Overhaul Reserve Account, the Tax Escrow Account and the
Contingency Account with the ABC Bank and the Debt Service Reserve Accounts and
the Establishment Expenses Account with GHI Bank and "Accounts" means
all of them collectively;
"Account Bank" means,
for the purposes of the Trust and Retention Account, the Dollar Construction
Account, the Current Debt . Service Accounts, the Commitment Charges Guarantee
Account, the Contingency Account, the Tax Escrow Account and the Overhaul
Reserve Account, the ABC Bank, Mumbal Main Branch at Mumbal, for the purposes
of the PPA Collection Account, the ABC Bank …………….Calcutta Main Branch, at
Calcutta and for the purposes of the Debt Service Reserve Accounts the GHI
Bank, Mumbai Branch and for purposes of the Establishment Expenses Account, the
GHI Bank, Calcutta Branch;
"MSEB"
means the Maharashtra State Electricity Board;
"Authorised
Investment" shall have the meaning given
in the Loan Agreements and
Guarantee
Agreements, provided that no Authorised Investment in respect of amounts in:
(a)
the Debt Service Reserve
Account shall, have a maturity in excess of 6 months;
(b)
the Current Rupee Debt
Service Account shall have a maturity in excess of the earlier of 3 months or
the next Payment Date;
(c)
the Current Dollar Debt
Service Account shall have a maturtty in exoess, of the
earlier
of 6 months or the next Payment Date;
(d)
the Commitment Charges
Guarantee Account shall have a maturity in excess of 3 months;
(e)
the Overhaul Reserve Account
shall have a maturity in excess of 12 months; the Dollar Construction Account shall have a maturity in excess of 1 month;
(g)
the Establishment Expenses
Account and the Contingency Account shall have a
maturity
in excess of 1 week; and
(h)
the Tax Escrow, Account
shall have a maturity in excess of 5 days;
"Average Debt Service
Coverage Ratio" shall have the meaning given
in the Loan
Agreements
and Guarantee Agreements;
"Budgeted Operating
Costs" means in relation to the relevant
calendar, month:
(i)
the costs included in the
Operating Budget for such month;
(ii)
plus and/or minus such
unbudgeted additional amounts as may be notified by the Borrower to the Account
Bank, after approval by the Security Trustee/Lead Institution and/or;
(iii)
plus such further amounts as
may be notified by the Borrower to the Account Bank, provided that the
aggregate amount notified by the Borrower under this paragraph (iii)during each
Year included in the Operating Budget, for costs other than fuel costs,
emergency operations, overhaul and maintenance, costs and costs resulting
from changes in, law. and tax rates,
shall not exceed 10% of 'the total budgeted amount for such year without the approval of the
Security Trustee/Lead Institution.
"Business Day" means
any day on which banks are generally open for business in Mumbai , in relation
to any notice or communication to be made under this Agreement, a day on,
which. banks are open for business in the place of receipt of such notice or
communication;
"Commitment
Charge" shall have the meaning ascribed thereto
in the Fuel Supply Agreement;
"Commitment Charges
Financing Documents" shall mean collectively the
agreements, instruments and other documents entered into by the Company and the
Commitment Charge Lenders or any part thereof, under which funding or guarantee
assistance is extended to the Company;
"Commitment Charges
Guarantee Account" means the account so named
which is established and maintained by the Borrower pursuant to this Agreement;
"Commitment Charge
Lenders" shall mean the Lenders providing fund
based or non fund based financial assistance for securing Commitment Charges under
the Fuel Supply Agreement;
"Construction
Costs" means the liabilities, costs and
expenses Incurred. by the Borrower in connection with the engineering,
procurement, manufacturing, construction and commissioning of the Project and
as mentioned in the Financing Plan, provided any deviation from the Financing
Plan shall be approved by the Security Trustee/Lead Institution and provided to
the Account Bank(s);
"Construction Costs
Budget" means each cash budget (the
"Budget") prepared by the Borrower and approved by the Security
Trustee/Lead Institution in writing for the construction of the Project. The
Budget shall be substantially in a form attached hereto as Annexure 1 or as
amended by the Borrower (with the prior r approval of the Security Trustee/Lead
Institution);
"Contingency
Proceeds" means proceeds of any insurance
effected by or on behalf of the Borrower, proceeds of any third party claims or
employers claims, performance shortfall damages under the EPC Contracts, delay
damages under the EPC Contracts and liquidated damages under the Fuel Supply
Agreement;
"Counter
Guarantors" shall mean DEF Bank, GHI
Bank and JKL Bank Limited.
"Current Debt Service
Accounts" means the Current Rupee Debt Service
Account and Current Dollar Debt Service Account;
"Current Dollar Debt
Service Account" means the account so named,
which is established and maintained by the Borrower pursuant to this Agreement;
"Current Rupee Debt
Service Account" means the account so named
which is established and maintained by the Borrower pursuant to this Agreement;
"Debt Service Reserve
Accounts" means the Dollar Debt Service Reserve
Account and the Rupee Debt Service Reserve Account;
"Distribution
Date" means the day of each calendar month or
if such day is not a Business Day, the immediately preceding Business Day, on
which payments have to be made under the Financing Documents or this Agreement,
as the case may be;
"Dollar" or "$"
means the lawful currency of the United
States of America;
"Dollar Budgeted
Operating Costs" means the Budgeted Operating
Costs denominated in Dollars;
"Dollar Construction
Account" means the account so named which is
established and maintained by the Borrower pursuant to this Agreement;
"Dollar Debt Service
Reserve Account" means the account so named
which is established and maintained by the Borrower pursuant to this Agreement;
"Dollar Lenders"
mean the ABC Bank, XYZ Finance Company Ltd, STR Development
Bank,
Power Finance Corporation Limited and Asian Development Bank;
"Enforcement
Notice" means a notice from the Security
Trustee/Lead Institution to the Account Banks of the acceleration of amounts
due and owing under the Financing Plan and/or any enforcement procedure
commenced by the Security Trustee/Lead Institution under any of the Security
Documents;
"Event of Default"
means an event of default as defined under the Financing Documents;
"Establishment Expenses
Account" means the account established pursuant
to clause
2.1
(xi)
"Financing
Documents" means the Guarantee Agreements and the
~ Loan Agreements;
"Financing Plan"
means the financing plan annexed to the Loan Agreements and the
Guarantee
Agreements, as amended;
"Foreign Currency Loan
Agreements" mean each of the following:
(i)
the Foreign Currency., Loan
Agreement between the Borrower and ABC Bank,
dated December 5, 2000;
(ii)
the Foreign Currency Loan
Agreement between the Borrower and the STR Development Bank, dated December 5, 2000;
(iii)
the Foreign Currency Loan
Agreement between the Borrower -and the XYZ Finance Company Ltd., dated November 26, 2000;
(iv)
the Foreign Currency Loan
Agreement between the Borrower and Power Finance Corporation Limited,
dated November 18, 2000; and
(v)
the Foreign Currency Loan
Agreement between the Borrower and The Asian
Development Bank, dated November
26, 2000.
"Guarantee
Agreements" means each of the following:
(i)
the Guarantee Agreement,
dated November 26, 1998 between the Borrower and the Industrial Finance Corporation of India;
(ii)
the Guarantee Agreement,
dated December 5, 2000 between the Borrower and ABC Bank;
(iii)
the Guarantee Agreement,
dated December 5, 2000 between the Borrower and the STR Development Bank;
(iv)
the Guarantee Agreement,
dated November 30, 2000 between the Borrower and GHI Bank;
(v)
the Guarantee Agreement,
dated December 2, 2000 between the Borrower and DEF Bank;
(vi)
the Guarantee Agreement,
dated December 2, 2000 between the Borrower and The JKL Bank Limited;
"Guarantee
Commission" means the guarantee commission payable
to the Guarantors under the Guarantee Agreements;
"Guarantors" means
the ABC Bank, the GHI Development Bank and the XYZ Finance Company Ltd.;
"Independent
Engineer" means a person appointed by the
Lenders, as the independent engineer;
"ABCP"
means ABC Power Generation Company Limited;
"Lenders" has
the meaning ascribed thereto in the Rupee Loan Agreements, Foreign
Currency
Loan Agreements, Guarantee Agreements and Subscription Agreement;
"Loans "
has the meaning ascribed thereto in the Rupee Loan Agreements, Foreign
Currency
Loan Agreements and Subscription Agreement;
"Loan Agreements"
means the Rupee Loan Agreements and the Foreign Currency Loan Agreements
"Operating Budget"
means each cash budget (the 'Budget") prepared by the Borrower, approved
by the Independent Engineer and the Security Trustee/Lead Institution in
writing for the operation and maintenance and any other costs of the Project,
including fuel (by tonnage), major overhaul costs (by event), establishment and
insurance costs, taxes, capital expenditures and debt service but excluding
Construction Costs. The Budget shall be substantially In a form attached hereto
as Annexure 2 or as amended by the Borrower (with the prior approval of the
Security Trustee/Lead Institution) and shall be prepared on an annual basis and
shall include projected monthly costs over a two year period except that the
first Budget shall be prepared for the period commencing on execution of this
agreement and ending on March 31, 2000. The second and subsequent Budgets, for
the two-year period commencing April 1, 1999, shall be provided to the Security
Trustee/Lead Institution one-month prior to the end of the financial year. Each
Budget will be reviewed by the Borrower no less frequently than once every
three months with any amendment thereto being submitted first to the
Independent Engineer and then to the Security Trustee/Lead Institution for
approval in writing and for delivery thereafter to the Account Banks;
"Overdraft
Facility" has the meaning ascribed in section
3.2.3.
"Overhaul Costs" means
those costs projected to be incurred during scheduled major overhaul outages
and excluding costs to be incurred for routine annual overhaul and more
frequent maintenance outages as specified in Annexure 2;
"Overhaul Reserve
Account" means the account so named which is
established and maintained by the Borrower pursuant to this Agreement;
"Payment Date"
means:
(i)
in relation to the Loan
Agreements, the dates specified for scheduled payments of fee, expenses,
principal and interest;
(ii)
in relation to the Guarantee
Agreements, the dates specified for scheduled payments of fees and guarantee
commissions;
"Permitted
Payment" means the payments to and/from the
Accounts contemplated by this Agreement;
"Power Purchase
Agreement" means the Power Purchase Agreement,
dated 31st
March,
1999 between ABCP and MSEB;
"PPA Collection
Account" means the account so named, established
- and maintained by the Borrower pursuant to this Agreement for the purposes of
deposit of payments under the Power Purchase Agreement;
'Project"
has the meaning given to it in the Loan Agreements;
"Project
Contracts" has the meaning ascribed thereto in the
Loan Agreements;
"Project Proceeds"
means all cash proceeds payable to the Borrower, in, connection with the
Project from any source including refund of taxes, other than- (i) Commitment
Charge Refunds under the Fuel Supply Agreement and any interest income or
return earned thereon, (ii) amounts deposited into the Dollar Construction
Account to be disbursed as dollars in accordance with the Financing Plan, and
(iii) Contingency Proceeds;
"Quarter" means
each three month period ending on March 31, June 30, September 30 and December
31;
"Required Balance"
means, on any Distribution Date:
(i)in
relation to the Current Dollar Debt Service Account, an amount in Dollars equal
to the product of (a) and (b) where,
(a)
Is a fraction, the denominator of which is 6 and the numerator of which is 6,
minus the number of months remaining
until the next following Payment Date, under the Foreign Currency Loan
Agreements pursuant to which half yearly
payments have to be made, and a fraction, the denominator of which is 3 and the
numerator of which is 3, minus the number of months remaining until the next
following Payment Date, under the Foreign Currency Loan Agreements pursuant to
which quarterly payments have to be made (for the avoidance of doubt, the numerator shall not
be less than zero); and (b) is the aggregate amount of interest (including
interest tax) and principal payable under the Foreign Currency Loan Agreements, on such Payment Date (for
the avoidance of doubt, any amounts due
more than six months and three months,
respectively after such Distribution Date shall not be taken into account),
less Interest income accrued;
(ii) in relation to the. Current Rupee Debt Service
Account, an amount in Rupees equal to the product of (a) and (b) where:
(a)
is a fraction, the
denominator of which is 3 and the numerator of which is 3 minus the number of
months remaining until the next following Payment Date under the Rupee Loan
Agreements with Rupee Lenders and the Guarantee Agreements with the Guarantors
(for the avoidance of doubt, the numerator shall not be less than zero); and
(b)
is the aggregate amount of
Interest (including interest tax) and principal payable under the Loan
Agreements with Rupee - Lenders and the Guarantee Commission payable to the
Guarantors under the Guarantee Agreements on such Payment Date (for the
avoidance of doubt, any amounts due more than three months after such
Distribution Date shall not be taken into account), less interest income
accrued;
(iii)
in relation to the Dollar
Debt Service Reserve Account, an amount in Dollars equal to the principal and
interest (including interest tax) scheduled to be paid under the Foreign
Currency Loan Agreements on the next two quarterly and one semi-annual Payment
Date; and
(iv)
in relation to the
Commitment Charges Guarantee Account, an amount in Rupees equal to the
Commitment Charges Guarantee Commission scheduled to be paid under the
Commitment Charges Financing Documents on the next two Payment Dates; and
(v)
in relation to the Rupee
Debt Service Reserve Account, an amount in Rupees equal to the principal and
interest (including interest tax) and Guarantee Commission scheduled to be paid
under the Rupee Loan Agreements and the Guarantee Agreements on the next two
Payment Dates; and
(vi)
(vi) in relation to the Overhaul
Reserve Account, an amount in Rupees (and in Dollars if necessary -and approved
by the Reserve Bank of India) for Overhaul Costs;
"Rupee" or
"Rs." means the lawful currency of India;
"Rupee Budgeted
Operating Costs" means the Budgeted
Operating Costs denominated in Rupees;
"Rupee Debt Service
Reserve Account" means the account so named
which is established and maintained by the Borrower pursuant to this Agreement;
"Rupee Lenders"
mean Power Finance Corporation Limited, the XYZ Finance Company Ltd., AAA
Finance and Insurance Company Ltd, BBB Finance Company Ltd, The JKL Bank
Limited and DEF Bank;
"Rupee Loan
Agreements" mean each of the following:
(i)
the Rupee Loan Agreement between
the Borrower and Power Finance Corporation dated December 4, 2000;
(ii)
the Subscription Agreement
between the Borrower and the XYZ Finance Company Ltd., dated November 26, 2000;
(iii)
the Rupee Loan Agreement
between the Borrower and the AAA Finance and Insurance Company Ltd., dated
December 1, 2000;
(iv)
the Rupee Loan Agreement
between the Borrower and the BB13 Finance Company Ltd., dated December 1, 2000;
(v)
the Rupee Loan Agreement
between the Borrower and The JKL Bank Limited, dated December 2, 2000; and
(vi)
the Rupee Loan Agreement
between the Borrower and r DEF Bank,'dated December 2, 2000;
"Security" means
the security created in favour of the Security Trustee/Lenders under the
Financing Documents;
"Security
Documents" has the meaning ascribed thereto in the
Financing Documents;
"Security Trustee"
means the XYZ Finance Company Ltd., appointed as Security Trustee by the
Lenders.
'"TRA Default"
shall have the meaning ascribed, thereto in this Agreement;
"Working Capital
Facility" shall mean the overdraft or other
credit facilities availed by the Borrower from the Working Capital Lenders;
"Working Capital
Lenders" has the meaning ascribed thereto in the
Financing Documents; and
"year" means
each twelve month period or each lesser period ending on March 31.
1.2
Construction
In
this Agreement:
(A)
reference to an Account.
includes a reference to any sub-account of that Account;
,
(B)
unless otherwise expressly
defined in this Agreement, capitalised terms which are defined in the Loan Agreement have the same meaning in this
Agreement;
(C)
unless the context otherwise
requires, the singular includes the plural and vice versa;
(D)
headings and the use of bold
typeface shall be ignored in Its construction;
(E)
a reference to a Clause or
Schedule Is, unless indicated to the contrary, a reference to a clause or
schedule to this Agreement;
(F)
references to this Agreement
shall be construed as references to any separate or independent stipulation or greement
contained in it;
(G)
the words "other",
'or otherwise" and "whatsoever" shall not be Constructed ejusdem
generis or be construed as any
limitation upon the generality of any preceding words or matters specifically
referred to;
(H)
references to the word
"includes' or "including" are to be construed without
limitation;
(I)
references to a person shall
include such person's successors and permitted assignees or transferees;
(J)
all references to
agreements, documents or other instruments include (subject to all elevant
approvals) a reference to that agreement, document or instrument as amended,
supplemented, substituted,, novated. or assigned from time to time;
(K)
words importing a particular
gender Include all genders;
(L)
"person" includes
any individual, partnership, firm, trust, body corporate, government,
governmental body, authority, agency,
unincorporated body of persons or association;
(M)
any reference to a public
organisation shall be deemed to Include a reference to any successor to such
public organisation or any organisation
or entity which has taken over the functions or responsibilities of such
public organisation;
(N)
references to
"Party" means a party to this Agreement and references to
"Parties" shall be construed
accordingly; and
(O)
references to any law shall
include references to such law as it may, after the date of this Agreement,
from time to time be amended,
supplemented or reenacted.
2.
The accounts
2.1
Establishment of the accounts
The
Borrower and the Account Banks confirm that the Borrower has-established in the
name of the Borrower with the ABC Bank Mumbai Main Branch.at Mumbai an.
Account………… No ……………...entitled ABC Power Generation Company Limited - Trust
and Retention Account, an account No ……………...
with ABC Bank ……………...
Branch
entitled the PPA Collection Account, and with the GHI Bank
……………...Branch,
accounts entitled Rupee Debt Service Reserve Account and Dollar Debt Service
Reserve Account and with GHI Bank Calcutta……………...Branch an account entitled
the "Establishment Expenses Account" and reference to the Trust and
Retention Account in this Agreement shall include reference to Rupee Debt
Service Reserve Account, the Dollar Debt Service Reserve Account and the
Establishment Expenses Account, unless the context otherwise requires. The
Trust and Retention Account shall have the following sub-accounts for the
purposes of this Agreement, namely:
(i)
a sub-account No
……………...denominated in Rupees entitled the OPPA
Collection Account" for the purpose of
receipt and same day credit to the Trust and
Retention Account of all
amounts payable by MSEB under the Power Purchase Agreement;
(ii)
a sub-account
No……………...denominated In Dollars entitled the 'Dollar Construction Account' it
being understood that, this account is
for the purpose of receipt of principal
received from the Dollar Lenders and for receipt of foreign equity for
application towards Construction Costs;
(iii)
(iii) a sub-account
No……………...denominated in Rupees entitled the "Current Rupee Debt Service
Account it being understood that, this account is for the purpose of accumulation on a monthly basis of one third
or more of the aggregate principal and
interest due to the Rupee Lenders and payable on the next quarterly
Payment Date;
(iv)
a sub-account No
……………....denominated in Dollars entitled the 'Current Dollar Debt Service
Account" it being understood that,
this account is for the purpose of accumulation on a monthly basis of one third or more of the
aggregate principal and interest due to the Dollar Lenders and payable on the
next quarterly Payment Date and of one
sixth or more of the aggregate principal and interest due to the Dollar Lenders
on
the next semi-annual Payment Date, as the case may be;
(v)
a sub-account No
…………….……denominated in Rupees entitled Commitment Charges Guarantee Account
it being understood that, this account
is for the purpose of accumulation on a
monthly basis of one third or more of
the aggregate Commitment Charges
Guarantee Commission due under the Commitment Charge Financing Documents and payable on the next quarterly
Payment Date;
(vi)
a sub-account No
…………….……denominated in Rupees entitled the "Rupee Debt Service
Reserve Account" it being
understood that, this account is for the purpose of retention of principal and interest due
to Rupee Lenders for the instalments of
6
months
principal and interest following the current instalment;
(vii)
a sub-account No
……………...denominated in Dollars entitled the Dollar Debt Service Reserve
Account" it being understood that,
this account Is for the purpose of retention of principal and interest on,
dollar Loans Lowed to Dollar Lenders by..the Borrower for the instalments of 6
months principal and interest Following
current instalment;
(viii) a
sub-account No ……………... denominated in Rupees entitled the "Tax Escrow Account"
it being understood that, this account
is for the purpose of retention of
amount and payment of taxes on income reimbursed by MPEB the Borrower;
(ix)
a sub-account No
……………...entitled the "Overhaul Reserve Account" it being understood
that, this account is for the purpose of
retention of amounts towards Overhaul
Costs projected to be Incurred during the next 12 months as per the Operating Budget;
(x)
a sub-account
No..........entitled "Contingency Account" it being understood that, this account is for
retention and use of Contingency Proceeds in accordance with this Agreement;
(m) a sub-account
No………………entitled the "Establishment Expenses Account" it being
understood that, this account is for the
purpose of retention of amounts payable towards expenses, in accordance with
the Operating Budget but excluding
those amounts paid from the Trust and
Retention Account under the Fuel Supply
Agreement and Operations and Maintenance Agreement and for Overhaul
Costs, etc. in accordance With Annexure 2; and
(xii) Such other accounts as may be agreed -between the
Borrower and the Security Trustee/Lead Institution.
2.2
Declaration of trust
The
Borrower hereby settles on trust with each of the Account Banks the sum of
Rs.100. The Borrower also hereby declares that all rights, title and interest
in and to the trust, Trust and- Retention Account and the Authorised
Investments made from the Trust and Retention Account shall be vested in the
Account Banks, the Lenders and the Borrower in accordance with the terms of
this Agreement and their respective interests are provided for herein. The
Account Banks hereby accept the above amount of Rs, 100 in the trust hereby
declared and upon the terms and conditions set -forth in this Agreement.
Amounts deposited in the Trust and Retention Account from time to time shall be
held in trust, received and applied as provided In this Agreement. No person
other than the Guarantors, the Lenders and the Borrower shall have any rights
hereunder as the beneficiaries of or as third party beneficiaries under, this
Agreement.
2.3
Maintenance of the accounts
The
Account Banks shall, save as otherwise provided herein, maintain the Trust and
Retention Account in accordance with the terms of this Agreement and its usual
practices and applicable regulations and, if permitted by applicable
regulations, pay the maximum rate of interest payable to Its customers on the
balance from time to time of the Trust and Retention Account as agreed between
the Borrower and each of the Account Banks individually from time to time.
2.4
Operating procedures
The
Account Banks and the Borrower have prior to execution of this Agreement agreed
(after consultation with the Security Trustee/Lead -Institution) on the
detailed mandates, terms and conditions and Operating Procedures for the Trust
and Retention Account, (as set out in Annexure 3 to this Agreement), provided
however, in the event of any inconsistency between this Agreement and such
mandates, terms and conditions or procedures, this Agreement shall prevail.
2.5
Sub-accounts
The
Borrower shall be permitted to instruct the Account Banks to make transfers to
and from a sub-account provided that the Required Balances are maintained.
2.6
General right of withdrawal with Security Trustee/Lead Institution Consent
Notwithstanding
any other provision of this Agreement, the Borrower may, at any time, with the
prior written consent of the Security Trustee/Lead Institution, instruct the
Account Banks to withdraw amounts from any Trust and Retention Account and pay
the same to an Account designated by the Borrower (irrespective of whether such
withdrawal and payment falls on a Distribution Date), provided that such
consent shall not be required If the Required Balance is maintained in relation
to the Trust and Retention Account and there is no TRA Default or an Event of
Default which has occurred and is then subsisting. The consent of the Security
Trustee/Lead Institution should indicate the details of any beneficiary of
payments.
2.7
Withdrawals to make payments prior to distribution date
Notwithstanding
any of the provisions of this Agreement:
(A)
the Borrower may instruct
the Account Banks to make withdrawals from the Current Rupee Debt Service Account ,or the Current Dollar Debt Service
Account in order to make any payments under the Financing Plan or Operating Budgets which fall due prior to a Distribution Date; and
(B)
if a Distribution Date is
not a date on which banks are generally open for business in the place, where
any account is held (being a place other
than Mumbai), the Borrower shall be entitled to instruct the Account Banks to make payment to or withdrawal from such account (and the corresponding
withdrawal from or payment to any
other account) on the immediately preceding
day on which banks are generally open for business In such place, provided that-any such payments and
withdrawals would have been permitted on such Distribution Date.
2.8
The restrictions in this
Agreement on withdrawal of funds from the Trust and Retention Account shall not
affect the obligations of the Borrower under the Financing Documents.
2.9
Any payment instructions of
the Borrower to the Account Bank under this Agreement shall be, as regards
Operating Costs, in accordance , with the Operating Budget and as regards other
payments, in, accordance with the Financing Documents.
3.
The Trust and Retention Account
3.1 Account
The
Trust and Retention Account shall ,be established in the name of the Borrower.
3.2
Deposits
3.2.1
The Borrower:
(A)
shall procure that all
Project Proceeds (other than interest income accumulated in the Current Debt
Service Accounts,
and in the Debt Service Reserve Accounts and the Overhaul
Reserve Account until the Required Balances
are attained) shall be credited to or deposited in the Trust and Retention
Account upon payment thereof;
(B)
shall procure that all
amounts deposited by APSEB in the PPA Collection Account shall be
credited/deposited Into the Trust and
Retention Account upon the same day as deposit Into the PPA Collection Account;
(C)
shall procure that. all
amounts credited/deposited in the Dollar Construction Account in excess of
Dollar disbursements under the Financing
Documents, shall be credited/deposited
into the Trust and Retention Account on
the same day as they are debited/withdrawn from the Dollar Construction Account
unless ,credited/deposited into the
Current Dollar Debt Service Account;
(D)
shall procure that all
amounts drawn by the Borrower pursuant to the Overdraft Facility
extended by each of the Working Capital
Lenders. shall be credited or deposited in the Trust and Retention Account;
(E)
shall procure the deposit of
Contingency Proceeds into the Contingency Account;
(F)
shall procure that any
surplus in any of the accounts shall be deposited into the Trust and Retention
Account unless retained in, or
transferred from the Dollar Debt Service Reserve Account to the Current Dollar
Debt Service Account to meet future obligations; and
(G)
may make other voluntary
deposits of the Borrower's funds into the Trust and Retention Account at any time.
3.2.2
The Account Banks shall procure that all interest, if any, on balances in the
Trust and Retention Account and interest on Authorised Investments made from
the Trust and Retention Account, not otherwise used for the purposes for which
the Debt Service Reserve Accounts, the Current Debt Service Accounts the
Overhaul Reserve Account and the Establishment Expenses Account are
established, shall be credited to or deposited In the Trust and Retention
Account.
3.2.3
While the Borrower is using a Working Capital Facility (the "Overdraft
Facility") with an Account Bank so long as there is no TRA Default or an
Event of Default which has occurred and Is then subsisting, any credit balance
remaining uninvested in the Trust and Retention Account and/or the
Establishment Expenses Account at the end of each day shall be automatically
credited against the Overdraft Facility provided by such Account Bank until the
Overdraft Facility balance is reduced to zero.
Any
deficiency in the Trust and Retention Account and/or the Establishment Expenses
Account at the end of each day shall big automatically funded from the
Overdraft Facility to bring such deficiency to zero (provided that borrowing
capacity remains under the Overdraft Facility).
3.3
Withdrawals
The
Account Banks shall withdraw amounts from the Trust and Retention Account on
each Distribution Date in accordance with the Borrower's instructions only for
the following purposes And in the following order of priority.
(A) to
pay
(i)
Rupee Budgeted Operating
Costs In accordance with the Operating Budget towards, inter afia fuel charges,
costs payable under the Operations and Maintenance Agreements, costs payable
towards insurance charges, establishment charges, taxes, capital, etc.; and
(ii)
Dollar Budgeted Operating
Costs in accordance with the Operating Budget; in each case, for the calendar
month in which such Distribution Date occurs in accordance with Annexure 11;
(B) to
pay
(i)
an amount to the Current
Rupee Debt Service Account equal to the Required Balance in relation to the
Current Rupee Debt Service Account; and
(ii)
an amount to the Current
Dollar Debt Service Account equal to the Required Balance in relation to the
Current Dollar Debt Service Account;
(B1)
to pay
(i) an amount to
the Commitment Charges Guarantee Account equal to the Required Balance in relation to the Commitment Charges
Guarantee Account;
(C) to
pay
an
amount to the Overhaul Reserve Account, unt 11 the amount projected to be
required to fund Overhaul Costs during the ensuing twelve months has been
accumulated;
(D) to
pay
(i)
an amount to the Rupee Debt
Service Reserve Account equal to:
(a)
the Required Balance in
relation to the Rupee Debt Service Reserve Account; minus
(b)
the amount standing to the
credit of the Rupee Debt Service Reserve
Account;
and
(ii)
an amount to the Dollar Debt
Service Reserve Account equal to:
(a)
the Required Balance in
relation to the Dollar Debt Service Reserve Account; minus
(b)
the amount standing to the
credit of the Dollar Debt Service Reserve Account;
(E)
to pay
dividends
to the shareholders of the Borrower as provided in section 15 of this
Agreement.
3.4
Application of Insufficient Funds
3.4.1 As provided In section 3.3, the application of
funds in the Trust and Retention Account shall be applied in the order of
priority set forth therein. If the funds available for payment to an Account
are sufficient to pay a portion, but not all, of the amount required to be paid
to any Account, the Borrower shall instruct the Account Bank to pay the
available funds, to the . relevant Account, with the prior consent of the
Security Trustee/Lead Institution
3.4.2
If, on any Distribution Date,
(A)
the, balance in the Trust
and Retention Account for payment towards Operating Cost is less than the amounts referred
to in section 3 1 ,3(A), the Account
Bank
shall pay that portion of available
Required Balances., first from
(D).,hereof, second
from (C) and third from (B) to make up such shortfall; or
(B)
the funds available for
payment to the Current Debt Service Accounts are less than the amounts referred
to in section 3.3 (B), the Borrower
shall instruct the Account Bank to pay
the portion of available Required Balances
first from (D) hereof and then from (C) to make such shortfall;
(C)
the funds available for
payment to the Overhaul Reserve Account are less than the amounts referred to
in section 3.3(C), the Borrower shall
instruct the Account Bank to pay the
portion of available Required Balances from (D) hereof to the Overhaul Reserve
Account as directed by the Borrower in accordance with the Operating Budget; or
(D)
the funds available for
payment to the Debt Service Reserve Accounts are less than the amounts-
referred to in section 3.3(D), the Borrower shall instruct the Account Bank to
pay the earliest available funds to the Rupee Debt Service Reserve, Account and.
the Dollar Debt Service Reserve Account pro rata in order to attain the
respective Required Balances applicable to such Accounts on such date.
3.4.3
For the purpose of calculating the amount of pro rata payments In accordance
with clause 3.4.2, the Borrower shall calculate the Required Balances in Rupees
based on the exchange rate in effect at
such time but the payments , shall be made in the currency in which relevant
Account Is denominated. For this purpose the Account Bank can rely on the
calculations provided to It by the Borrower in writing.
4.
PPA Collection Account
4.1 Account
The
PPA Collection Account shall, be established in the name of the Borrower.
4.2
Deposits
The
Borrower shall procure payments of amounts due and payable by MSEB under the
Power, Purchase Agreement into this Account.
4.3
Withdrawals
Any
amount deposited in the PPA Collection Account shall be credited on the same
day as the deposit to the Trust and Retention Account.
5. Dollar Construction
Account
5. 1
Account
The
Dollar Construction Account shall be established, subject to the approval of
the Reserve Bank of India, in the name of the Borrower.
5.2
Deposits
The
Borrower shall procure that all amounts (i) drawn down under the Foreign
Currency Loan Agreements, other than that with The Asian Development Bank, for
application towards Construction Costs and (ii) of equity received from the
foreign shareholders of the Borrower are deposited into this Account.
5.3
Withdrawals
The
Account Bank shall withdraw amounts in the Dollar Construction Account and make
payments towards Dollar amounts due and payable under the EPC contracts and
also for payment of Dollar amounts due and payable towards. non-EPC costs in
accordance with the Financing Plan and on the instructions of the Borrower. Any
amounts remaining in the Dollar Construction Account at any time which are not
required to make Dollar payments.in accordance with the Financing Plan will, on
the instructions of the Borrower, with the consent of the Security Trustee/Lead
Institution, be converted into Rupees for deposit into the Trust and Retention
Account. Provided that any surplus amount in the Dollar Construction Account
after Project Completion (as defined in the EPC Contract) shall be used to
prepay the Loans on a pro rata basis.
6.
Establishment Expenses Account
6.1 Account
The
Establishment Expenses Account shall be established in the name of the
Borrower.
6.2
Deposits
Deposits
to the Establishment Expenses Account shall be made in accordance with the
Operating Budget under section 3.3 (A) above.
6.3
Withdrawals
The
Account Bank shall withdraw amounts from the Establishment Expenses Account in
accordance with the Operating Budget.
7.
Current Debt Service Accounts
7.1
Account
The
Current Debt Service Accounts shall be established in the name of the Borrower.
The Current Dollar Debt Service Account shall be denominated in Dollars and the
Current Rupee Debt Service Account shall be denominated In Rupees.
7.2
Deposits
(A)
Deposits to the Current
Rupee Debt Service Account
Deposits
to the Current Rupee Debt Service Account shall be made by the Account Bank in
accordance with sections 3.3(13)(J) and 9.3(B).
(B)
Deposits to the Current
Dollar Debt Service Account
Deposits
to the Current Dollar Debt 'Service Account shall be made by the Account Bank
in accordance with Sections 3.3(B) (h) and 9.4(B).
7.3
Withdrawals from the Current Rupee Debt Service Account
The
Account Bank shall withdraw amounts from the Current Debt Service Account on a
Distribution Date:
(A)
on the instructions of the
Borrower to pay amounts due under the Financing Plan on such date; or
(B)
on the instructions of the
Borrower with the prior written consent of the Security Trustee/Lead
Institution.
7.4
Withdrawals from the Current Dollar Debt Service Account
The
Account Bank shall withdraw amounts from the Current Dollar Debt Service
Account on a Distribution Date:
(A)
on the instructions of the
Borrower to pay amounts due under the Financing Plan on such date; or
(B)
on the instructions of the
Borrower with the prior written consent of the Security Trustee/Lead Institution.
7.5
Application of Insufficient Funds
If
the amounts available in a Current Debt Service Account are insufficient to pay
amounts due under Loan Agreements and the Guarantee Agreements In the order of
priority listed in the Loan Agreements and the Guarantee Agreements, the
Borrower shall instruct the Account Bank to pay the available amounts pro rata
to the aggregate-, of each of the amounts due there under and in accordance
with the priority in the Loan Agreements and the Guarantee Agreements. For this
purpose the Account Bank can rely on the calculations provided to it by the
Borrower in writing with the approval of the Security Trustee/Lead Institution.
7A. Commitment Charges
Guarantee Account
7A.
1 Account
The
Commitment Charges Guarantee Account shall be established in the name of the
Borrower. The Account shall be denominated in Rupees.
7A.2
Deposits
Deposits
to the Commitment Charges Guarantee Account shall be made by the Account Bank
in accordance with section 3.3(131)(1).
7A.3
Withdrawals
The
Account Bank shall withdraw amounts from the Commitment Charges Guarantee
Account on a Distribution Date:
(A)
on the instructions of the
Borrower to pay amounts due under the Commitment Charge Financing Documents on such date; or
(B)
on the instructions of the
Borrower with the prior written consent of the Security Trustee/Lead Institution.
8.
Overhaul Reserve Account
8.1
Account
The
Overhaul Reserve Account shall be established in the name of the Borrower. The
Account shall be denominated in Rupees until such time as an additional
Overhaul Reserve Account, denominated in Dollars, is required and approval of
the Reserve Bank of India to open such an account is obtained.
8.2
Deposits
Deposits
to the Overhaul Reserve Account shall be made by the Account Bank in accordance
with section 3.3(C), provided the amount to be maintained in the Account for
any projected twelve months Overhaul Costs will be reduced by any cash and
Authorised Investments retained by the Borrower in excess of cash and/or
Authorised Investments required for the Current Debt Service Accounts and Debt
Service Reserve Accounts.
8.3
Withdrawals
(A)
The Account Bank shall
withdraw amounts from this Account on the instructions of the Borrower for
payment of Overhaul Costs in accordance with the Operating Budget.
(B)
In the event there are
amounts in excess of the projected requirements, the Borrower may, at its
option, direct the Account Bank to transfer any such excess to be transferred
to the Trust and Retention Account.
9.
Debt Service Reserve Accounts
9.1
Account
The
Debt Service Reserve Accounts shall be established in the name of the Borrower.
The Dollar Debt Service Reserve Account shall be denominated in Dollars and the
Rupee Debt Service Reserve Account shall be denominated in Rupees.
9.2
Deposits to the Debt Service Reserve Account
(A) Deposits
to the Rupee Debt Service Reserve Account
Deposits
to the Rupee Debt Service Reserve Account shall be made by the Account Bank in
accordance with sections 3.3(13)(t).
(B) Deposits
to the Dollar Debt Service Reserve Account
Deposits
to the Dollar Debt Service Reserve Account shall be made by the Account Bank in
accordance with sections 3.3(13)(fi).
9.3.
Withdrawals from the Rupee Debt Service Reserve Account
The
Account Bank shall withdraw amounts from the Rupee Debt Service Reserve Account
on a Distribution Date:
(A)
on the instructions of the
Borrower to make payments to the Current Rupee Debt Service Account to the
extent that the amount standing to the credit of such account is less than the
Required Balance; or
(B)
on the instructions of the
Borrower to make payments to the Overhaul Reserve Account to the extent that
the amount standing to the credit of such account is less than the Required
Balance; or
(C)
to the extent that the
balance of the Rupee Debt Service Reserve Account exceeds its Required Balance,
on the instructions of the Borrower to pay the excess in the Rupee Debt Service
Reserve Account (or such lesser amount as the Borrower may specify) solely to
the Trust and Retention Account; or
(D)
on the instructions of the
Borrower with the prior written consent of the Security Trustee/Lead
Institution.
9.4
Withdrawals from the Dollar Debt Service Reserve Account
The
Account Bank shall withdraw amounts from the Dollar Debt Service Reserve
Account on a Distribution Date:
(A)
on the instructions of the
Borrower, to make payments to the Current Dollar Debt Service Account to the
extent that the amount standing to the credit of such Account is less than the
Required Balance; or
(B)
to the extent that the
balance of the Dollar Debt Service Reserve Account exceeds its Required
Balance, on the instructions of the Borrower, to pay the excess in the Dollar
Debt Service Reserve Account (or such lesser amount as the Borrower may
specify) solely to the Trust and Retention Account; or
(C)
on the instructions of the
Borrower with the prior written consent of the Security Trustee/Lead
Institution.
9A. Tax Escrow Account 9A. 1
Account
The
Tax Escrow Account shall be established in the name of the Borrower.
9A.2
Deposits
The
Borrower shall procure deposit amounts paid by APSEB towards reimbursement ,of
taxes on Income of the Borrower under the Power Purchase Agreement into this
Account.
9A.3
Withdrawals
The
Account Bank shall, on the instructions of the Security Trustee/Lead
Institution, utilise such amounts towards payment of taxes on income of the
Borrower as provided in the Rupee Operating Budget.
9B. Contingency Account
9B.1 Account
The Contingency Account shall be established
in the name of the Borrower.
9B.2 Deposits
The
Borrower shall procure deposit of all Contingency Proceeds into this Account.
9B.3
Withdrawals
The
Account Bank shall withdraw amounts from the Contingency Account:
(i)
being insurance proceeds at
the instructions of the Borrower to make good any
repair
or loss;
(ii)
being proceeds of third
party and employers' liability claims at the instructions of the Borrower for
payment to the person to whom liability is due unless the claim has been
previously settled by the Borrower, in which case the proceeds shall be
deposited in the Trust and Retention Account;
(iii)
being proceeds of liquidated
'damages under the EPC Contract at the instructions of the Borrower to pay
damages payable under the Power Purchase Agreement or other Project Contracts
as a result of events which gave rise to liquidated damages;
(vi) being proceeds of liquidated damages under the Fuel
Supply Agreement to pay damages payable under the Power Purchase Agreement or
other Project Contracts as a result of events which gave rise to liquidated
damages; and
(v) to the extent of any surplus remaining after the
application of funds as provided in (i) to (iv) above, to the extent Required
Balances have not been I attained, at ,the option of the Lenders to prepay the
Loans or retain the surplus In the Trust and Retention, Account, provided that
if the Required Balances have already been attained, the surplus shall be
transferred to the Trust and Retention Account.
10.
Currency Conversion
For
the purposes of ensuring that the proceeds of any withdrawal made hereunder
from the Trust and Retention Account are denominated in the currency in which
the same are to be applied hereunder, the Borrower shall instruct the Account
Banks to convert the amount of any such withdrawal from the currency in which
the same is denominated into the currency in which the proceeds thereof are to
be applied at the then appricable exchange rate offered by the Account Bank in
the normal course of its business or to transfer such withdrawal to any other
banking institution selected by the Borrower for the sale or purchase of
currency, in accordance with applicable approvals from the Reserve Bank of
India from time to time. If the conversion is made prior to the relevant
withdrawal date, the Account Banks shall retain the funds so converted in a
Rupee or Dollar subaccount maintained in connection with such Account or, if no
such sub-account is required to be so maintained, a sub-account in the relevant
currency established for such purpose:
Provided
that any amounts payable by MSEB required to be converted into Dollars to meet
Dollar obligations shall be converted into Dollars promptly after deposit into
the Trust and Retention Account in accordance with this Agreement.
Any
currency conversion by the Borrower shall be in accordance with the approval of
the Reserve Bank of India.
11. Authorised Investments
11.
1 Power to invest
The
Account Banks shall invest in Authorised Investments on the instructions of the
Borrower, subject as provided in this Agreement, from such part of the amounts
standing to the credit of any of the Trust and Retention Account. Section 20 of
the Indian Trusts
Act,
1882 shall not apply to investments of amounts in the Trust and Retention
Accounts.
11.2
Procedure for investments
11.2.1
All Authorised Investments shall be made and/or realised by the Account Banks
in accordance with the Borrower's instructions.
11.2.2
All documents of title or other documentary evidence of ownership with respect
to Authorised Investments made out of any Account will be held in the custody
of the Account Bank under the name and for the account of the Borrower.
11.
3 Realisations
Upon
the realisation of any investment made under this Section, the proceeds of
realisation shall immediately be credited to the relevant Account by the
Account Banks or immediately invested in another Authorised Investment in
accordance with the Borrower's instructions.
11.4
Mandatory realisations
In
the event, that the Borrower becomes aware that any Authorised Investment has
ceased to be an Authorised Investment, the Borrower shall immediately instruct
the Account Banks on a best efforts basis to realise such Authorised Investment
on its maturity date or earlier if so instructed by the Borrower.
11.5
Accounts Include Investments
Any
reference in this Agreement to the balance standing to the credit of an Account
shall
be deemed to include a reference to the principal and interest accrued thereon
of Authorised Investments in which all or part of such balance is invested.
11.6
Interest on Investments
Except
as otherwise described herein, any interest or other income paid in respect of
Authorised Investments shall be paid to the Trust and Retention Account.
11.
7 Enforcement notice
On
receipt of an Enforcement Notice from the Security Trustee/Lead Institution,
the Account Banks shall realise the Authorised Investments, whether such
investments have matured or not, on a best efforts basis and apply the proceeds
as directed by the Security Trustee/Lead Institution (who shall act in
accordance with the Security Documents).
12.
Withdrawals following event of default
12.1
Events of default
If
the Security Trustee/Lead Institution notifies the Account Banks that an Event
of Default has occurred, and is continuing, then, until such time as the
Security Trustee/ Lead Institution has notified the Account Banks that the.
Event of Default has been cured or waived under the relevant Loan Agreements
and/or the Guarantee Agreements only upon receipt of Instructions from the
Security Trustee/Lead Institution the Account Banks shall act and make
withdrawals from the Accounts In accordance with the instructions of the
Security Trustee/Lead Institution.
12.2
Enforcement notices
The
Account Banks, at any time after the notification to them by the Security
Trustee/ Lead Institution of the occurrence of an Enforcement Notice and until
such time as it is notified by the Security Trustee/Lead Institution that such
Enforcement Notice has been revoked by the Security Trustee/Lead Institution,
shall:
(A)
not be obliged to act on the
instructions of the Borrower pursuant to this Agreement in relation to any sums
at such time standing to the credit of the Accounts except with the prior
written consent of the Security Trustee/Lead Institution;
(B)
be entitled to pay to the
Security Trustee/Lead Institution any sums standing to the credit of the
Accounts for application by the Security Trustee/Lead Institution in or towards
the payment and discharge of any amounts owing to the.Lenders under the
Financing Documents in accordance with the Security Documents;
(C)
not honour any cheques or
other payment instructions of the Borrower without the consent of the Security
Trustee/Lead Institution.
Upon
an Enforcement Notice, the Borrower undertakes not to issue any cheque or
payment instructions, to the, Account Banks without the consent of the Security
Trustee/ Lead Institution.
13.
Account banks provisions
13.1
The Account Banks and the Lenders
The
Borrower hereby appoints the Account Banks to act as trustee for the Security
Trustee/Lead Institution and the Borrower in connection herewith, and
authorises the Account Banks to exercise such rights, powers, authorities and
discretions as are specifically delegated to the Account Banks by the terms
hereof, together with all such rights, powers, authorities and discretions as
are reasonably incidental hereto, and the Account Banks accept such appointment
pursuant to the terms hereof.
13.2
Particular Duties of the Account Bank
The
Account Bank:
(A)
may, in the absence of bad
faith or gross negligence on its part, rely as to any matters of fact which
might reasonably be expected to be within the knowledge of the Borrower upon a
certificate signed by or on behalf of the Borrower;
(B)
may, in the absence of bad
faith or gross negligence on its part, rely upon the authenticity of any
communication or documents believed by it to be authentic;
(C)
shall, within 5 business
days after receipt, deliver a copy to
the Security Trustee/ Lead Institution of any notice or document
received by the Account Banks in their capacity as Account Banks from the
Borrower -or any other person hereunder or in connection herewith; and
(D)
shall, within 5 business
days after receipt, deliver a copy tothe Borrower of any notice or document
received by the Account Banks from the Security Trustee/ Lead Institution or
any of the Lenders in connection herewith..
13.3
Segregation of Funds
Monies
and other property received by the Account Banks under this Agreement shall,
until used or applied in, accordance with this, Agreement, be hold in trust
for, the purposes for which they were received and shall be segregated from
other funds and property of the Account Banks.
13.4
Termination
13.4.1
This Agreement shall remain in full force and effect so long as, amounts remain
outstanding from the Borrower under the Financing Plan, unless terminated
earlier by the mutual consent of the parties or otherwise in accordance with
the provisions of this Section by written notice from the Security Trustee/Lead
Institution to the Account Banks.
13.4.2
The Borrower may, by not less than 45 days prior notice to the Account Bank(s)
and the Security Trustee/Lead Institution, terminate this Agreement and appoint
one or more Account Banks, provided that the new Account Bank(s) War&
acceptable to the Security Trustee/Lead Institution and arrangements are made
satisfactory to the Security Trustee/Lead Institution for transfer of amounts
deposited in the Accounts to new Accounts established with the successor
Account Bank(a).
13.4.3
The Account Banks shall be entitled to terminate this Agreement if the Borrower
fails to comply with any of its material obligations to the Account Banks under
this Agreement and fails to remedy the failure within 45 days after receipt of
notice thereof from the Account Banks to the Borrower and the Security
Trustee/Lead Institution, provided the Borrower appoints new Account Banks
acceptable to the Security Trustee/ Lead Institution and arrangements are made
satisfactory to the Security Trustee/Lead Institution for transfer of amounts
deposited in the Accounts to now Accounts established with successor Account
Banks.
13.5
Fees
The
Borrower shall pay the Account Banks fees in an amount and at such times as may
be agreed between the Account Banks and the Borrower.
13.6
Books and Records
The
Borrower authorises the Account Banks to give the Security Trustee/Lead
Institution unrestricted access to review the books and records of the Account
Banks, subject to restrictions in law and right of confidentiality of the
Account Banks. The Borrower irrevocably grants the Security Trustee/Lead
Institution access to review the books and records of the Trust and Retention
Account and irrevocably waives any right of confidentiality, which may exist in
respect of such books and records to the Security Trustee/Lead Institution.
13.7
Statement of Investments
Upon
the request of the Security Trustee/Lead -Institution, not later than 5
business days after the end of any calendar month, the Borrower will deliver to
the Lenders a schedule of investments acquired or disposed off during that
month in respect of the Trust and Retention Agreement, in such detail as the
Lenders may reasonably require. Xcp.df
13.8
Notice of Breach
The
Account Banks undertake to the Security Trustee/Lead Institution that It shall
notify the Security Trustee/Lead Institution of any breach by the Borrower (to
the best of its knowledge) of the provisions of this Agreement.
14.
TRA defaults
If
the Borrower is in breach of. any of its obligations under this Agreement and,
following notice of default from the Security Trustee/Lead Institution, falls
to remedy the same:
(A)
in the case of a failure to
deposit funds received by the Borrower in the appropriate Account in accordance
with this Agreement, by depositing the same in such appropriate Account within
five business days of receipt of such notice;
(B)
in the case of a breach
consisting of causing the Account Banks to transfer funds to any Account in
breach of the terms of this Agreement, by depositing the relevant funds in the
Account in which such transfer should have been made (or, in the case of a
transfer to the Trust and Retention Account, by requesting the Security
Trustee/Lead Institution to authorise the transfer of amounts incorrectly
deposited in such Account to the Account to which the transfer should have been
made) within five business days of receipt of such notice;
(C)
in the case of a breach of
the Borrower's obligations under section 12, by instructing the Account Banks
to realise any investment made in, breach of section
12
within five business days of receipt of such notice;
(D)
in case the Average Debt
Service Coverage Ratio is less than 1.2; or
(E)
(E) in the case of any other breach,
within 30 days of suc
(F)
(F) h notice; such default shall be
deemed to be a “TRA Default “, and the Security Trustee/Lead Institution shall
promptly authorlse the Account Banks to make transfers required pursuant to
paragraph (B) above.
15.
Dividends
If
there has not occurred an (i) Event of Default, or (ii) a TRA Default and if
the Required Balance in the Debt Service Reserve Accounts, the Overhaul Reserve
Account and the Current Debt Service Accounts is in compliance with the amount
specified in this Agreement, or (iii) there is no claim pending against the
Borrower which has not been contested by the Borrower or provided for by means
of a reserve in the Trust and Retention Account, and (iv) the Security
Trustee/Lead Institution is satisfied that amounts in the Trust and Retention Account
are adequate to meet the Operating Costs in accordance with the Annual
Operating Budget for the month in which dividend is proposed to be declared,
then the Security Trustee/Lead Institution shall allow the Borrower to pay the
maximum dividend permitted under law, provided the Average Debt Service
Coverage Ratio for the four calendar quarters Immediately prior to, the
proposed dividend payment date and the four calendar quarters subsequent
thereto, Including the quarter in which the dividend is proposed to be paid, Is
1.4 or greater provided that the calculation of the Average Debt Service
Coverage Ratio shall be subject to the prior written approval of the Security
Trustee/Lead Institution.
16.
Representation and warranties of the account bank and the Borrower
Each
of the Account Banks and the Borrower represent and warrant. that, it is duly
organised and validly existing under the laws of India, with power to enter
into this Agreement and tax exercise its rights and perform its obligations hereunder
and has taken all corporate and other actions required for the execution of
this Agreement and the performance of its obligations hereunder.
17.
Miscellaneous
17.1
Closure of Accounts
The
Account Banks shall, at the request of the Borrower made on or after the
payment by the Borrower of all outstanding amounts under the Loan Agreements
and Guarantee Agreements (for this purpose, excluding the ADB Loan Agreement)
and the Guarantee Agreements as confirmed by the Security Trustee/Lead
Institution, close the Accounts and pay any amount standing to the credit
thereof to the Borrower.
17.2
Restriction on Assignment
Save
as provided in section 13.4, neither the Borrower, the Security Trustee/Lead
Institution nor the Account Banks shall assign or transfer any part of their
respective rights or obligations under this Agreement without the prior consent
of the other, provided that the Security Trustee/Lead Institution may assign or
transfer its rights and obligations to a successor Security Trustee/Lead
Institution, with the consent of the Borrower (which shall not be unreasonably
withheld) and this section 17.2 shall not prevent any Lender from assigning or
transferring its rights under the Loan Agreements and the Guarantee Agreements,
in accordance with the terms thereof.
17.3
Successors and assignors
This
Agreement shall be binding on and shall Inure to the benefit of the Parties and
their respective successors and permitted assigns.
17.4
No set off
The
Account Banks agree not to claim or exercise any right of set off, banker's
lien or other right or remedy with respect to amounts standing to the credit of
the Trust and Retention Accounts. For the avoidance of doubt, it is declared by
the Account Banks that the monies and properties held by the Account Banks
shall not be considered as part of the assets of the Account Banks and, being
trust property, shall in the case of a bankruptcy or liquidation of the Account
Banks be wholly excluded from the assets of the Account Banks in such
bankruptcy or liquidation.
17.5
Notices
17.5.1
All notices or other communications to be given or made under this Agreement
shall be in writing and shall either be delivered personally or sent by
courier, registered or certified mail or facsimile. The address for service of
each Party and its facsimile number is set out under its name on the signature
pages hereof. All notices shall be effective upon actual receipt, save that
where a notice is transmitted by facsimile and is received after 5.30 p.m. on a
business day or on a day that is not a business day, such notice shall be
deemed to be received on the first business day following the date of actual
receipt. Without prejudice to the foregoing, a Party giving or making a notice
or communication by facsimile, shall promptly deliver a copy of such notice or
communication personally, by courier or mail to the addressee of such notice or
communication.
17.5.2
Any Party may by notice change the addresses and/or addresses to which such
notices and communications to it are to be delivered or mailed. Such change
shall be effective when all the Parties have written notice of it.
17.6
Waiver
Failure
by any Party at any time to enforce any provision of this Agreement or to
require performance by the other Parties of any provision of this Agreement,
shall not be construed as a waiver of such provision and shall not affect the
validity of this Agreement or any part of it or the right of the relevant
Party, to enforce any provision in accordance with its terms.
17.7
Severability
If
any condition, Section or provision of this Agreement not being of a
fundamental nature is held to be illegal or unenforceable, the validity or
enforceability of the remainder of this Agreement shall not be affected
thereby.
17.8
Amendments
No
amendment to this Agreement shall be binding unless in writing and signed by
the duly authorised representatives of the Parties.
17.9 Governing law
This
Agreement shall be governed by and construed in accordance with Indian law.
17.
10 Regulatory approvals
Each
of the Account Banks shall use its best efforts to procure and shall
thereafter, maintain and comply with all regulatory approvals required for it,
to establish and operate the Accounts. Each of the Account, Banks represent and
warrant to the Borrower that, it is not aware of any reason why such regulatory
approvals will not be ordinarily granted to the Account Bank.
17.11
Notification of balances
Within
7 days following the end of each calendar monthly reporting date, the Account
Banks shall notify the Security Trustee/Lead Institution of the respective
balances in the Accounts a statement of the deposits into and payment out of
the Accounts, as at the close of business of such calendar month.
IN
WITNESS whereof the Borrower has caused its Common Seal to be affixed hereto
and to a duplicate hereof on the date first above written and the Account Banks
and the Security Trustee/Lead Institution have caused the same and the said
duplicate to be executed by the hand of an authorised official.
SIGNED AND DELIVERED
by the within named ABC BANK by the hand of……………. an authorized official of the
Account Bank
Address
for notice
ABC
Bank
Branch Fax No.
SIGNED AND DELIVERED
by the within named THE GHI BANK LIMITED by the hand of……………….an authorised
official of the Account Bank
Address
for notice
GHI
Bank
SIGNED AND DELIVERED by THE XYZ FINANCE
COMPANY LIMITED within named Security Trustee by the hand of……………….an
authorised. Official of the Security Trustee/Lead Institution acting as trustee
for the Lenders.
Address
for notice
The XYZ Finance Company Ltd.
………………………………….
…………………………………..
Mumbai
Fax No.
THE
COMMON SEAL of ABC
POWER
GENERATION COMPANY LIMITED pursuant to the Resolution
of its Board of
Directors passed in
that………………behalf on the day of…………..2001
hereunto been affixed in the presence of ........................ Director and
…………..Secretary who have signed these presents in token thereof Address for notice
………………….
…………………..
…………………..
ANNEXURE1
FORM
OF CONSTRUCTION, COSTS BUDGET
The
Construction Costs Budget may be amended by mutual agreement of the Borrower
and the Security Trustee/Lead Institution.
ANNEXURE2
FORM
OF OPERATING BUDGET
The
Operating Budget may be amended by mutual agreement of the Borrower and the
Security Trustee/Lead Institution.
ANNEXURE3
OPERATING
PROCEDURES
The
Operating Procedures may be amended by agreement of the Borrower, the Security
Trustee/Lead Institution and the Account Banks.
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