Document:

Share Option Agreement Between Eggborough and Barclays, Dated Sept 30, 2004

 Exhibit 4.31 
  

			
	

	 	LIMITED LIABILITY PARTNERSHIP

  
 CONFORMED COPY

  
 EGGBOROUGH POWER (HOLDINGS) LIMITED 
  
 AS SELLER 
  
 AND 
  
 BARCLAYS BANK PLC 
  
 AS BUYER 
  
 AND 
  
 EGGBOROUGH POWER LIMITED 
  
 AND 
  
 BRITISH ENERGY POWER AND ENERGY TRADING LIMITED 
  

  
 SHARE OPTION AGREEMENT 
  

 CONTENTS 
  

					
	 Clause

	 	 	  	Page

	 1.
	 	Interpretation	  	1
			
	 2.
	 	Condition Precedent	  	15
			
	 3.
	 	Grant of Call Option to Buy Shares	  	15
			
	 4.
	 	Exercise of Break Option	  	15
			
	 5.
	 	Exercise of the Enforcement Option	  	16
			
	 6.
	 	Revocation of Notice	  	16
			
	 7.
	 	Break Option Price	  	16
			
	 8.
	 	Enforcement Option Price	  	17
			
	 9.
	 	Discharge of Finance Party Liabilities	  	17
			
	 10.
	 	Experts	  	17
			
	 11.
	 	Sales	  	18
			
	 12.
	 	Evaluation of Break Option	  	18
			
	 13.
	 	Calculation of Reduction Amount	  	19
			
	 14.
	 	Failure to Transfer	  	20
			
	 15.
	 	Break Option Completion	  	21
			
	 16.
	 	Enforcement Option Completion	  	22
			
	 17.
	 	Post Break Option Completion	  	23
			
	 18.
	 	Approved Fuel Contracts	  	23
			
	 19.
	 	Purchase of Approved Fuel	  	24
			
	 20.
	 	Release of Collateral	  	24
			
	 21.
	 	Escrow Account	  	25
			
	 22.
	 	Pensions	  	26
			
	 23.
	 	Warranties	  	27
			
	 24.
	 	Restrictions	  	27
			
	 25.
	 	Tax and Other Costs and Expenses	  	27
			
	 26.
	 	Payments	  	29
			
	 27.
	 	Conversion to Euros	  	29
			
	 28.
	 	Invalidity or Illegality	  	29
			
	 29.
	 	General	  	30
			
	 30.
	 	Entire Agreement	  	30
			
	 31.
	 	Assignment	  	31

					
	 32.
	 	Seller’s Offer	  	31
			
	 33.
	 	Buyer’s Enquiries	  	32
			
	 34.
	 	Seller’s Acceptance	  	32
			
	 35.
	 	Non-Acceptance of Buyer’s Offer	  	32
			
	 36.
	 	Confidentiality	  	32
			
	 37.
	 	Notices	  	33
			
	 38.
	 	Term	  	35
			
	 39.
	 	Governing Law and Jurisdiction	  	35
			
	 40.
	 	Counterparts	  	35
		
	 SCHEDULE 1 COMPLETION ACCOUNTS
	  	36
		
	 SCHEDULE 2 FORM OF SHARE OPTION NOTICE
	  	38
		
	 SCHEDULE 3 FORM OF ENFORCEMENT OPTION
NOTICE
	  	40
		
	 SCHEDULE 4 WARRANTIES
	  	43
		
	 SCHEDULE 5 INSTRUCTION LETTER TO ESCROW
AGENT
	  	44
		
	 SCHEDULE 6 ENFORCEMENT FEE
	  	46
		
	 SCHEDULE 7 FORM OF DISPOSAL NOTICE
	  	47
		
	 SCHEDULE 8 CONFIDENTIALITY UNDERTAKING
	  	48

 THIS AGREEMENT is made on 30 September 2004 
  
 BETWEEN: 
  

	(1)	EGGBOROUGH POWER (HOLDINGS) LIMITED, a company incorporated in Scotland (registered no. SC201083), whose registered office is at 3 Redwood Crescent, Peel Park, East Kilbride
G74 5PR (the “Seller”); 

  

	(2)	BARCLAYS BANK PLC, a company incorporated in England and Wales (registered no. 01026167), whose registered office is at 54 Lombard Street, London EC3P 3AH acting as agent and
security trustee for the Finance Parties (the “Buyer”); 

  

	(3)	EGGBOROUGH POWER LIMITED, a company incorporated in England and Wales (registered no. 03782700), whose registered office is at Barnett Way, Barnwood, Gloucester,
Gloucestershire GL4 3RS (the “Company”); and 

  

	(4)	BRITISH ENERGY POWER AND ENERGY TRADING LIMITED (registered number SC200887) whose registered office is at 3 Redwood Crescent, Peel Park, East Kilbride, G74 5PR
(“BEPET”). 

  
 THE PARTIES AGREE as follows:

  

	1.	INTERPRETATION 

  

	1.1	In this Agreement: 

  
 “Acceptance Period” means, in respect of any proposed Disposal and subject to Clause 32, the period commencing on the date a Disposal
Notice is properly served on the Seller in respect of such proposed Disposal and ending at close of business in London (5 p.m.) on the date falling 10 Business Days thereafter. 
  
 “Account Bank” has the same meaning as given to it in the Credit Agreement. 
  
 “Accounts” means the Company’s audited accounts (as
that term is used in section 226 of the Act) for the financial year ended on the Last Accounting Date. 
  
 “Act” means the Companies Act 1985 as modified or re-enacted from time to time. 
  
 “Actual Approved Fuel” means the amount of Approved Fuel
stored at the Station on the Option Completion Date as set out in the Fuel Survey. 
  
 “Additional Capital Expenditure” means any capital expenditure incurred by the Seller, or on behalf of the Seller by a Seller’s Group Company, other than pursuant to the Capital Investment Works
Schedule (as defined in the New CTA) but with the prior approval of the Agent. 
  
 “Additional Capital Expenditure Amount” means: 
  

	 	(a)	in respect of the Break Option, the amount or amounts (if any) agreed by the Agent and the Seller as representing the benefit to the Finance Parties as at the Break Option
Completion Date of any Additional Capital Expenditure paid for by a Seller’s Group Company; and 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 1 -	  	 

	 	(b)	in respect of the Enforcement Option, the amount or amounts (if any) determined by the Experts as representing the benefit to the Finance Parties as at the Enforcement Option
Completion Date of any Additional Capital Expenditure paid for by a Seller’s Group Company. 

  
 “Adjusted Break Fee” means the Break Fee, subject to the following adjustments: 
  

	 	(a)	there shall be added such amount (if any) by which the Net Assets as shown in the Statement are greater than zero pounds sterling (£0); 

  

	 	(b)	there shall be deducted such amount (if any) by which the Net Assets as shown in the Statement are less than zero pounds sterling (£0); and 

  

	 	(c)	the Reduction Amount (if any) shall be deducted. 

  
 “Agent” has the same meaning as given to it in the Credit Agreement. 
  
 “Agreement” means this agreement, together with the Schedules hereto. 
  
 “Amendment and Restatement Agreement” has the same meaning
as given to it in the Credit Agreement. 
  
 “Ancillary
Services” has the same meaning as given to it in the New CTA. 
  
 “Approved Fuel” has the same meaning as given to it in the New CTA. 
  
 “Approved Fuel Contracts” means any contract for the sale and purchase of fuel between BEPET and any third party, provided that: 
  

	 	(a)	such contract has been approved by the Agent in accordance with clause 15.17(c) of the Credit Agreement; and 

  

	 	(b)	prior to the Option Completion Date, BEPET has notified the Company in writing that such contract is to be novated in accordance with Clauses 18.1. 

  
 “Approved Fuel Price” means: 
  

	 	(a)	in respect of the Break Option, an amount equal to the book value of the Actual Approved Fuel as recorded in the accounting records of BEPET in accordance with generally accepted
accounting principles in the United Kingdom; and 

  

	 	(b)	in respect of the Enforcement Option, an amount equal to the then applicable market value of the Actual Approved Fuel (taking into account the cost of delivering fuel equivalent to
the Actual Approved Fuel to the Station), as agreed between the Buyer and the Seller or, if they cannot agree, as determined by the Fuel Expert. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 2 -	  	 

 “Asset Option Agreement” means the asset option agreement between the Company, the Buyer
and BEPET dated on or about the date of this Agreement under which the Company grants an option to the Buyer to acquire the Business and the Station Assets. 
  
 “Asset Option Notice” has the same meaning as given to “Option Notice” in the Asset Option Agreement. 
  
 “BEH” means British Energy Holdings plc a company with
registered number SC270186 whose registered office is at 3 Redwood Crescent, Peel Park, East Kilbride, G74 5PR. 
  
 “Break Fee” means the aggregate of: 
  

	 	(a)	one hundred and four million pounds sterling (£104 million); and 

  

	 	(b)	an amount equal to the Scheduled CTA Bond Amount (if any). 

  
 “Break Option” has the same meaning as given to it in Clause 3.1.1. 
  
 “Break Option Completion” means completion of the Break Option in accordance with Clause 15. 
  
 “Break Option Completion Date” means 31 March 2010.

  
 “Break Option Price” means the aggregate
purchase price of the Option Shares, being the sum of: 
  

	 	(a)	the Additional Capital Expenditure Amount; and 

  

	 	(b)	the Adjusted Break Fee. 

  
 “Break Option Time” means the Option Time in respect of the Break Option. 
  
 “British Energy plc” means the company of that name with registered number SC162273 whose registered office
is at 3 Redwood Crescent, Peel Park, East Kilbride, G74 5PR. 
  
 “Business” means the business of generation, transmission and sale of electricity and the provision of Ancillary Services as carried on by the Seller. 
  
 “Business Day” means a day other than a Saturday or Sunday or public holiday in England and Wales or
Scotland. 
  
 “Buyer’s Accountants” means
Ernst & Young LLP or such other recognised firm of auditors licensed to practice in England and Wales and Scotland as the Buyer may, by notice in writing to the Seller, appoint for the purposes of this Agreement. 
  
 “Buyer’s Solicitors” means Allen & Overy LLP, or
such other solicitors as the Buyer may, by notice in writing to the Seller, appoint for the purposes of this Agreement. 
  
 “Cap Amount” means the sum of (i) £267,300,000 plus (ii) the EPL Swap Amount less (iii) the Equity Amount. 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 3 -	  	 

 “CCL” has the same meaning as given to it in Clause 25.3. 
  
 “Close Period” means the period starting on (and including)
the date of this Agreement until the earlier of (but excluding): 
  

	 	(a)	an Option Completion Date; and 

  

	 	(b)	31 March 2010. 

  
 “Collateral Provider” has the same meaning as given to it in Clause 20.1.1. 
  
 “Competitor” means any competitor of a Seller’s Group
Company, as notified by the Seller (acting reasonably) to the Buyer within 5 Business Days of receipt of an Option Notice. 
  
 “Completion” means Break Option Completion or Enforcement Option Completion (as the case may be). 
  
 “Completion Accounts” means the profit and loss account of
the Company for the period starting on the day after the Last Accounting Date and ending on the Option Completion Date and the balance sheet of the Company as at the Option Completion Date and all attached notes, to be prepared in accordance with
Schedule 1. 
  
 “Confidential Information” means
any information relating to a Seller’s Group Company or any third party which is obtained by the Buyer, its directors, officers, employees, legal advisers, accountants, auditors and/or financial advisers, as a result of the negotiation and
entering into of the Restructuring Documents whether such information is obtained before or after the date of this Agreement. 
  
 “Confidentiality Undertaking” means the confidentiality undertaking substantially in the form set out in Schedule 8. 
  
 “Covenant Expert” has the same meaning as given to it in
Clause 13.6. 
  
 “Covenants” has the same
meaning as given to it in Clause 13.1.1. 
  
 “Credit
Agreement” means the credit agreement originally dated 13 July 2000 as amended and restated on 8 September 2000, 24 October 2000, 12 December 2000, 5 February 2001 and on or about the date of this Agreement between, inter alios, the
Buyer and the Company. 
  
 “Creditor Restructuring
Agreement” means the creditor restructuring agreement dated as of 30 September 2003 between, inter alios, British Energy plc and the Company. 
  

“CTA Bonds” means the £150 million seven (7)% fixed rate bonds issued by BEH on the Restructuring Date as represented by the CTA
Global Bond Certificate. 
  
 “CTA Global Bond
Certificate” means the certificate issued in respect of the CTA Bonds by BEH to the Company on or about the Restructuring Date. 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 4 -	  	 

 “Disposal” means an assignment and/or transfer of all (but not part only) of the
Buyer’s rights under this Agreement. 
  
 “Disposal
Agreement” means, in respect of any proposed Disposal, a document: 
  

	 	(a)	complete in all material respects, save the dating thereof; 

  

	 	(b)	on substantially the same terms as the Third Party Disposal Agreement relating to such proposed Disposal; 

  

	 	(c)	stating the Purchase Price; and 

  

	 	(d)	which, subject to the acceptance by the Seller in accordance with Clauses 32 to 35 of this Agreement, will constitute a legally binding agreement for the making by the Buyer and
acceptance by a Seller’s Group Company, of such Disposal. 

  
 “Disposal Notice” means a notice substantially in the form of Schedule 7. 
  
 “Disposal Period” means, in respect of any proposed Disposal, the period commencing on the date the Acceptance Period ends and ending at
close of business in London (5 p.m.) one calendar month thereafter. 
  
 “Dispute” has the same meaning as given to it in Clause 39.2. 
  
 “Due Date” has the same meaning as given in Clause 21.1. 
  
 “Employees” means the employees of the Company as at the Option Completion Date. 
  
 “Encumbrance” means a mortgage, charge, pledge, lien,
option, restriction, right of first refusal, right of pre-emption, third-party right or interest, other encumbrance or security interest of any kind, or another type of preferential arrangement (including a title transfer or retention arrangement)
having similar effect. 
  
 “Enforcement Event”
means the exercise by the Buyer (acting in its capacity as security trustee for the Finance Parties) of any or all of its rights under any Security Document in accordance with clause 18.2(a)(i) of the Credit Agreement. 
  
 “Enforcement Fee” means, in respect of the Enforcement
Option: 
  

	 	(a)	where the Enforcement Option is being exercised as a consequence of a Payment Default or a Station Default, the sum of £1; or 

  

	 	(b)	otherwise, the amount applicable to the month in which the Enforcement Option Notice was delivered, as set out in Schedule 6, 

  
 together with, in each case, an amount equal to the Scheduled CTA Bond
Amount. 
  
 “Enforcement Notice Date” means the
date on which the Buyer notifies the Seller that it wishes to exercise the Enforcement Option in accordance with clause 18(a)(ii) of the Credit Agreement. 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 5 -	  	 

 “Enforcement Option” has the same meaning as given to it in Clause 3.1.2. 
  
 “Enforcement Option Cap Amount” means the sum of:

  

	 	(a)	the Cap Amount; and 

  

	 	(b)	an amount equal to the interest that would have accrued on the Cap Amount up to (and including) the Enforcement Notice Date had the Cap Amount been outstanding from the
Restructuring Date and borne interest at the rate of 4.75 per cent. per annum (calculated on the basis of a year of 365 days). 

  
 “Enforcement Option Claim Amount” means the Proceeds less the Enforcement Fee. 
  
 “Enforcement Option Completion” means completion of the
Enforcement Option in accordance with Clause 16. 
  
 “Enforcement Option Completion Date” means a date falling after the Restructuring Date but no later than 31 August 2009 specified by the Buyer in the Enforcement Option Notice as being the date on which the Enforcement
Option is to be completed. 
  
 “Enforcement Option
Notice” means a written notice in the form set out in Schedule 3 from the Buyer to the Seller exercising the Enforcement Option pursuant to Clause 5.1.2. 
  
 “Enforcement Option Price” means the sum of: 
  

	 	(a)	the Additional Capital Expenditure Amount (if any); 

  

	 	(b)	the Enforcement Fee; and 

  

	 	(c)	the Redemption Fee (if any). 

  
 “Enforcement Option Time” means the Option Time in respect of the Enforcement Option. 
  
 “EPL Swap Amount” means an amount equal to the sum of all
EPL Swap Crystallised Liabilities calculated as being due from EPL (if any) in respect of the termination of all Swap Agreements on the earlier of (i) 20 October 2004 and (ii) the Restatement Date. 
  
 “EPL Swap Crystallised Liability” has the same meaning as
given to it in Schedule 3 of the Creditor Restructuring Agreement. 
  
 “Equity Amount” means: 
  

	 	(a)	an amount equal to the middle market quotation for ordinary shares in the Parent on the Enforcement Notice Date as derived from the Daily Official List of the London Stock Exchange,

  
 multiplied by: 
  

	 	(b)	the number of ordinary shares issued by the Parent to the Finance Parties on the Restructuring Date. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 6 -	  	 

 “Escrow Account” means a separately designated interest-bearing account with the Account
Bank in the name of the Escrow Agent. 
  
 “Escrow
Agent” means the person appointed by the Buyer and the Seller pursuant to the Escrow Letter. 
  
 “Escrow Letter” means the instruction letter substantially in the form set out in Schedule 5 (or any other agreed form) from the Buyer
and the Seller to the Escrow Agent. 
  
 “Euro”
means the lawful currency of the member states of the European Union that adopt the single currency in accordance with the Treaty establishing the European Community, as amended by the Treaty on European Union. 
  
 “Euro Effective Date” has the same meaning as given to it
in Clause 27.1. 
  
 “Evaluation” has the same
meaning as given to it in Clause 12.1. 
  
 “Evaluation
Report” has the same meaning as given to it in Clause 13.1. 
  
 “Event of Default” has the same meaning as given to it in the Credit Agreement. 
  
 “Expert” has the same meaning as given to it in Clause 10. 
  
 “Finance Documents” has the same meaning as given to it in the Credit Agreement. 
  
 “Finance Parties” or “Finance Party” has
the same meaning as given to it in the Credit Agreement. 
  
 “Finance Party Liabilities” means all present and future sums, liabilities and obligations (actual or contingent) payable, owing, due or incurred by the Obligors to any of the Finance Parties under or in connection with the
Finance Documents. 
  
 “Financial Expert” means
a person: 
  

	 	(a)	who is independent and who has confirmed in writing that it will (i) have no conflict in acting as an Expert; and (ii) remain neutral and impartial at all times when acting as an
Expert under this Agreement; 

  

	 	(b)	who is not a Competitor; 

  

	 	(c)	who is not an affiliate of either the Seller or the Buyer; and 

  

	 	(d)	being a reputable bank, financial institution or international accounting firm having appropriate expertise in the production of financial models for, and the assessment and
valuation of cashflows relating to, power stations of a similar type, and operated in a similar manner, as the Station within the United Kingdom. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 7 -	  	 

 “First Amount” has the same meaning as given to it in Schedule 3 of the Creditor
Restructuring Agreement. 
  
 “First Intercompany Loan
Agreement” means the intercompany loan agreement dated on or about the date of this Agreement between BEH as lender and EPHL as borrower. 
  
 “Frustration Event” means: 
  

	 	(a)	an Event of Default pursuant to clause 17.10(a) and (b) of the Credit Agreement; or 

  

	 	(b)	the destruction of all or a material part of the Station Assets (taken as a whole); or  

  

	 	(c)	where, in respect of any Share Option Notice, at any time after 31 August 2009 but prior to the Break Option Completion Date, a breach by the Seller of the Covenants has resulted in
a reduction in the value of the Station Assets taken as a whole (as compared to the aggregate value of the Station Assets as at 31 August 2009) in excess of £104,000,000 and such event has been notified by the Buyer to the Seller no later than
one calendar month prior to the Break Option Completion Date and confirmed by the Experts. 

  
 “Fuel Expert” means a person approved by BEPET and the Buyer in writing who has appropriate expertise in the evaluation of fuel stocks at
power stations similar in type to the Station. 
  
 “Fuel
Survey” means a full volumetric and density survey of the Approved Fuel stored at the Station prepared by the Fuel Expert. 
  
 “Heavy Fuel Oil Agreement” means the agreement to supply heavy fuel oil dated 27 March 2002 between TotalFinaElf UK Limited as supplier
and the Company as buyer. 
  
 “Indemnified
Party” means the Seller and each of its affiliates, employees, directors, officers, agents and representatives. 
  
 “Indemnity Amount” means the Indemnity Proceeds less: 
  

	 	(a)	all amounts accrued but unpaid under the Finance Documents (other than this Agreement) on the Long-Stop Date; and 

  

	 	(b)	     

  

	 	(i)	if the Enforcement Option has been exercised, the sum of the Enforcement Fee and the Redemption Fee that would have been payable had the Enforcement Option been completed in
accordance with this Agreement; or 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 8 -	  	 

	 	(ii)	if the Break Option has been exercised, the Adjusted Break Fee that would have been payable had the Break Option been completed in accordance with this Agreement; and

  

	 	(c)	the Additional Capital Expenditure Amount (if any). 

  
 “Indemnity Proceeds” means on the Sales Proceeds Date, an amount equal to the sum of: 
  

	 	(a)	the aggregate value as at the Sales Proceeds Date of all, or any of, the Option Shares that the Seller continues to own on the Sales Proceeds Date in breach of this Agreement, as
determined by the Experts; and 

  

	 	(b)	any amounts, dividends or other distributions received by the Seller on, and/or in respect of, the Option Shares during the Sales Period. 

  
 “Independent Engineer” has the same meaning as given to it
in Clause 12.1. 
  
 “Industry Documents” has the
same meaning as given to it in the Credit Agreement. 
  
 “Intra-Group Obligation” has the same meaning as given to it in Clause 20.1.1. 
  
 “Last Accounting Date” means the last day of the financial year of the Company immediately preceding the Option Completion Date.

  
 “LIBOR” means in relation to any amount
under this Agreement on which interest for a given period is to accrue, the rate per annum at which Barclays Bank PLC was offering prime banks in the London interbank market deposits in sterling for such period as of 11.00 am on the date falling 2
Business Days prior to the start of such period. 
  
 “Long-Stop Date” has the same meaning as given to it in Clause 14.1. 
  
 “Majority Banks” has the same meaning as given to such term in the Credit Agreement. 
  
 “Net Assets” means the Working Capital Assets less the
Working Capital Liabilities. 
  
 “Net Sales
Proceeds” means: 
  

	 	(a)	the aggregate proceeds received or receivable or deemed receivable (whether for cash or consideration in kind, directly or indirectly) by, or on behalf of, the Buyer (or its
nominee) and/or any Finance Party in respect of the sale of all, or any of, the Option Shares and/or all, or any part of, the Business and/or the Station Assets at any time during the Sales Period (provided that in the event that all, or any of, the
Option Shares or all, or any part of, the Business and/or the Station Assets is sold more than once during the Sales Period, only the first such sale (in each case) shall be taken into account for the purposes of this definition),

  
 less: 
  

	 	(b)	all reasonable expenses (but excluding any Taxes (other than any stamp tax payable by the Buyer (or its nominee) in connection with the exercise of the Enforcement Option)) incurred
by the Buyer (or its nominee) with the prior written consent of the Seller. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 9 -	  	 

 “New CTA” means the capacity and tolling agreement dated on or about the date of this
Agreement between the Company and BEPET. 
  
 “Novated
Debt” means the First Amount less the Second Amount. 
  
 “Obligors” has the same meaning as given to it in the Credit Agreement. 
  
 “Option” means the Break Option or the Enforcement Option (as the case may be). 
  
 “Option Completion Date” means the Break Option
Completion Date or the Enforcement Option Completion Date (as the case may be). 
  
 “Option Notice” means a Share Option Notice or an Enforcement Option Notice (as the case may be). 
  
 “Option Shares” means all the shares in the capital of the Company registered in the Seller’s name on the Option Completion Date.

  
 “Option Time” means the time at which notice
to exercise an Option pursuant to Clause 4.1.2 or 5.1.2 is deemed given to the Seller by virtue of Clause 37.2. 
  
 “Parent” means British Energy Group plc a company with registered number SC270184 whose registered office is at 3 Redwood Crescent, Peel
Park, East Kilbride, G74 5PR. 
  
 “Payment
Default” has the same meaning as given to it in the Credit Agreement. 
  
 “Permitted Encumbrance” means any Encumbrance over the Option Shares: 
  

	 	(a)	arising under, or permitted by, the Restructuring Documents and the Documents (as defined in the Credit Agreement); 

  

	 	(b)	arising as a result of the act or omission of the Buyer or any Finance Party; or 

  

	 	(c)	any liens imposed by law (to the extent not extant as the result of any default or omission of the Seller). 

  
 “Proceedings” has the same meaning as given to it in Clause
39.4. 
  
 “Proceeds” means on the Sales Date, an
amount equal to the sum of: 
  

	 	(a)	the aggregate Net Sales Proceeds on the Sales Date; 

  

	 	(b)	in the event that the Seller continues to own all, or any of, the Option Shares on the Sales Date as a result of a breach of this Agreement by the Seller, the aggregate value as at
the Sales Date of such Option Shares, as determined by the Experts; 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 10 -	  	 

	 	(c)	in the event that the Seller transfers all, or any of, the Option Shares to the Buyer (or its nominee) pursuant to this Agreement, the aggregate value as at the Sales Date of any
such Option Shares that have not been sold during the Sales Period (but disregarding any sale under this Agreement for these purposes), as determined by the Experts; and 

  

	 	(d)	any amounts, dividends or other distributions received on, and/or in respect of, the Option Shares during the Sales Period. 

  
 “Purchase Price” means the Third Party Purchase Price
multiplied by one hundred and five per cent. (105%). 
  
 “Records” means the Seller’s books and records relating exclusively to the Business and the Station Assets. 
  
 “Redemption Fee” means, if the Enforcement Option Claim Amount exceeds the Enforcement Option Cap Amount, the difference between such
amounts. 
  
 “Reduction Amount” has the same
meaning as given to it in Clause 13.1.2. 
  
 “Relevant
Event” has the same meaning as given to it in Clause 28.1. 
  
 “Restatement Date” has the same meaning as given to it in the Amendment and Restatement Agreement. 
  
 “Restructuring Date” has the same meaning as given to it in the Creditor Restructuring Agreement. 
  
 “Restructuring Documents” has the same meaning as given to
it in the Creditor Restructuring Agreement. 
  
 “Sales
Completion Date” means on or after the Option Completion Date, the date on which all the Option Shares are sold (but disregarding any sale under this Agreement). 
  
 “Sales Date” means the earlier of the Sales Completion Date and the Sales Proceeds Date. 
  
 “Sales Period” means the period commencing on the Option
Completion Date and ending on the Sales Date (both inclusive). 
  
 “Sales Proceeds Date” means the date falling (12) calendar months after the Option Completion Date. 
  
 “Scheduled CTA Bond Amount” means the aggregate of: 
  

	 	(a)	all repayments of principal under the Credit Agreement which would have been due on a scheduled basis on or after the Option Completion Date but which have instead been received
prior to the Option Completion Date; and 

  

	 	(b)	any premium received by the Finance Parties in respect of the payments made in paragraph (a) above. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 11 -	  	 

 “Second Amount” has the meaning given to such term in Schedule 3 of the Creditor
Restructuring Agreement. 
  
 “Security” means
the security interests from time to time constituted by or pursuant to the Security Documents. 
  
 “Security Documents” has the same meaning as given to it in the Credit Agreement. 
  
 “Seller’s Accountants” means PricewaterhouseCoopers
LLP or such other recognised firm of auditors licensed to practice in England and Wales and Scotland as may be appointed by the Seller from time to time. 
  
 “Seller’s Group Company” means the Parent or an undertaking which is, on or at any time after the date of this Agreement, a
subsidiary undertaking of the Parent. 
  
 “Share Option
Notice” means a written notice in the form set out in Schedule 2 from the Buyer to the Seller exercising the Option pursuant to Clause 4.1.2. 
  
 “Share Subscription Agreement” means the share subscription deed dated on or about the date of this Agreement between, inter
alios, the Company and the Buyer. 
  
 “Statement” means a statement of the adjustments to made to the Break Fee pursuant to paragraphs (a) and (b) of the definition of Adjusted Break Fee, to be prepared in accordance with Schedule 1. 
  
 “Station” means the coal fired power station located at
Eggborough, Yorkshire with a capacity of approximately 2000MW. 
  
 “Station Assets” means all property and assets owned by the Company at the Option Completion Date (wherever located). 
  
 “Station Default” has the same meaning as given to it in the Credit Agreement. 
  
 “Swap Agreement” has the same meaning as given to in
Schedule 3 of the Creditor Restructuring Agreement. 
  
 “Tax” means all taxes and all levies, duties, imports, charges and withholdings in the nature of taxation whenever and wherever imposed, including taxes on gross or net income, profits or gains and taxes on receipts, sales,
use, occupation, franchise, value added and personal property together with all fines, penalties, charges and interest relating to any of them. 
  
 “Technical Expert” means a person: 
  

	 	(a)	who is independent and who has confirmed in writing that it will (i) have no conflict in acting as an Expert; and (ii) remain neutral and impartial at all times when acting as an
Expert under this Agreement; 

  

	 	(b)	who is not a Competitor; 

  

	 	(c)	who is not an affiliate of either the Seller or the Buyer; and 

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 12 -	  	 

	 	(d)	having appropriate expertise in the technical assessment and valuation of power stations of a type similar to, and operated in a similar manner as, the Station within the United
Kingdom. 

  
 “Third Party” means
any person other than a Seller’s Group Company. 
  
 “Third Party Disposal Agreement” means, in respect of any proposed Disposal, a document: 
  

	 	(a)	complete in all respects, save the dating thereof; 

  

	 	(b)	setting out the terms required by the Buyer for the making of the Disposal to the relevant Third Party; and 

  

	 	(c)	in which the Third Party Purchase Price is stated as a fixed and ascertained amount. 

  
 “Third Party Purchase Price” means, in respect of any proposed Disposal, the price (if any) for such
Disposal agreed between the Buyer and the relevant Third Party. 
  
 “Transferee” means the holder of the Option Shares immediately after the transfer of the Option Shares in accordance with Clause 16.2.1. 
  
 “VAT” has the same meaning as given to it in Clause 25.3. 
  
 “Warranty” means a statement contained in Schedule 4 and
“Warranties” means all those statements. 
  
 “Working Capital Assets” means the sum of the amounts in the Completion Accounts attributed to those items agreed between the Buyer and Seller prior to the Restructuring Date as being “working capital assets”.

  
 “Working Capital Liabilities” means the sum
of the amounts in the Completion Accounts attributed to those items agreed between the Buyer and Seller prior to the Restructuring Date as being “working capital liabilities”. 
  

	1.2	In this Agreement, a reference to: 

  

	 	1.2.1	a “subsidiary undertaking” is to be construed in accordance with section 258 of the Act; 

  

	 	1.2.2	liability under, pursuant to or arising out of (or any analogous expression) any agreement, contract, deed or other instrument includes a reference to contingent liability under,
pursuant to or arising out of (or any analogous expression) that agreement, contract, deed or other instrument; 

  

	 	1.2.3	a party being liable to another party, or to liability, includes any liability in equity, contract or tort (including negligence) or under the Misrepresentation Act 1967;

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 13 -	  	 

	 	1.2.4	a statutory provision includes a reference to such statutory provision as modified or re-enacted or both from time to time before the date of this Agreement and any subordinate
legislation made under the statutory provision (as so modified or re-enacted) before the date of this Agreement; 

  

	 	1.2.5	this Agreement or any other agreement or document shall be construed as a reference to this Agreement or, as the case may be, such other agreement or document as the same may have
been, or may from time to time be, amended, varied, novated or supplemented; 

  

	 	1.2.6	a “person” includes a reference to any individual, firm, company, corporation or other body corporate, government, state or agency of a state or any joint venture,
association or partnership, works council or employee representative body (whether or not having separate legal personality) and includes a reference to that person’s legal personal representatives, successors and permitted assigns;

  

	 	1.2.7	a “party” includes a reference to that party’s successors and permitted assigns; 

  

	 	1.2.8	“£” and “pounds sterling” is to the lawful currency of the United Kingdom; 

  

	 	1.2.9	a “clause”, “paragraph”, “sub-paragraph” or “schedule”, unless the context otherwise requires, is a
reference to a clause or paragraph or sub-paragraph of, or schedule to, this Agreement; 

  

	 	1.2.10	any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official or any legal concept or thing shall, in respect of any
jurisdiction other than England, be deemed to include what most nearly approximates in that jurisdiction to the English legal term and any reference to any English statute shall be construed so as to include equivalent or analogous laws of any other
jurisdiction; 

  

	 	1.2.11	the terms “include”, “includes” and “including” shall be construed without limitation; 

  

	 	1.2.12	a reference to “disposal” is to be construed so as to include a sale, lease or other disposal; 

  

	 	1.2.13	a time of day is a reference to the time in London; and 

  

	 	1.2.14	a document in the “agreed form” is a reference to a document in a form approved and for the purposes of identification signed by or on behalf of each party.

  

	1.3	The headings in this Agreement do not affect its interpretation. 

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 14 -	  	 

	2.	CONDITION PRECEDENT 

  
 The provisions of this Agreement shall only become effective on the occurrence of the Restatement Date. 
  

	3.	GRANT OF CALL OPTION TO BUY SHARES 

  

	3.1	In consideration of £2,500,000 satisfied by the Buyer agreeing to the reduction by that amount of the amount owing by the Seller to the Buyer under the Novated Debt, the
Seller irrevocably grants to the Buyer: 

  

	 	3.1.1	an option to buy, and to require the Seller to sell, all of the Option Shares on the Break Option Completion Date (the “Break Option”); and

  

	 	3.1.2	an option to buy, and to require the Seller to sell, all of the Option Shares at any time after the Enforcement Notice Date but prior to 31 August 2009 (the “Enforcement
Option”), 

  
 in each case, in accordance
with the terms and conditions of this Agreement. 
  

	3.2	The Option Shares shall be sold with full title guarantee free from any Encumbrance other than a Permitted Encumbrance and with all rights attaching to the Option Shares on the
Option Completion Date including the right to receive any dividend, distribution or return of capital declared, paid or made in respect of the Option Shares in respect of periods starting on or after the Option Completion Date.

  

	4.	EXERCISE OF BREAK OPTION 

  

	4.1	The Break Option may be exercised by the Buyer only: 

  

	 	4.1.1	in whole and not in part; and 

  

	 	4.1.2	by the delivery by the Buyer to the Seller of a Share Option Notice at any time after the Restructuring Date but no later than 31 August 2009. 

  

	4.2	The Buyer may not deliver a Share Option Notice to the Seller at the same time as, or at any time after: 

  

	 	4.2.1	the delivery by it of an Enforcement Option Notice or an Asset Option Notice; or 

  

	 	4.2.2	the occurrence of an Enforcement Event. 

  

	4.3	After the Break Option Time, the Buyer may only revoke the Share Option Notice in accordance with Clause 6. 

  

	4.4	It shall be a condition of the exercise of the Break Option that on the Break Option Completion Date, the Buyer (acting in its capacity as security trustee for the Finance Parties)
shall fully and irrevocably discharge, or procure the full and irrevocable discharge of, all the Finance Party Liabilities and fully and irrevocably release, or procure the full and irrevocable release of, the Security. 

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 15 -	  	 

	5.	EXERCISE OF THE ENFORCEMENT OPTION 

  

	5.1	The Enforcement Option may be exercised by the Buyer only: 

  

	 	5.1.1	in whole and not in part; and 

  

	 	5.1.2	by the delivery by the Buyer to the Seller of an Enforcement Option Notice at any time after the Enforcement Notice Date but prior to 31 August 2009. 

  

	5.2	The Buyer may not deliver an Enforcement Option Notice to the Seller at the same time as, or at any time after: 

  

	 	5.2.1	the delivery by it of a Share Option Notice or an Asset Option Notice; or 

  

	 	5.2.2	the occurrence of an Enforcement Event. 

  

	5.3	After the Enforcement Option Time, the Buyer may only revoke the Enforcement Option Notice in the circumstances set out in Clause 6. 

  

	5.4	It shall be a condition of the exercise of the Enforcement Option that on the Enforcement Option Completion Date, the Buyer (acting in its capacity as security trustee for the
Finance Parties) shall fully and irrevocably discharge, or procure the full and irrevocable discharge of, all the Finance Party Liabilities and fully and irrevocably release, or procure the full and irrevocable release of the Security.

  

	5.5	If, at any time after an assignment and/or transfer of all of the Buyer’s rights under this Agreement in accordance with Clause 31, the new owner of such rights is not owed
directly all of the Finance Party Liabilities, then, immediately upon the occurrence of such assignment or transfer, the rights of the Buyer under this Clause 5 and to the Enforcement Option shall be cancelled in full and shall not be capable of
future use or revival. 

  

	6.	REVOCATION OF NOTICE 

  

	6.1	The Buyer may only revoke an Option Notice: 

  

	 	6.1.1	with the prior written consent of the Seller; or 

  

	 	6.1.2	where a Frustration Event has occurred and is continuing and the Buyer (acting on the instructions of the Majority Banks) has voted to enforce the Security Documents in accordance
with clause 18.2(a)(i) of the Credit Agreement. 

  

	7.	BREAK OPTION PRICE 

  

	7.1	In consideration for the purchase of the Option Shares pursuant to the exercise of the Break Option, the Buyer shall: 

  

	 	7.1.1	pay to the Seller the Break Option Price, by paying to the Seller: 

  

	 	(a)	on the Break Option Completion Date, the Additional Capital Expenditure Amount; and 

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 16 -	  	 

	 	(b)	the Adjusted Break Fee in accordance with Clause 17; and 

  

	 	7.1.2	take the steps set out in Clause 9. 

  

	7.2	The provisions of Schedule 1 shall apply in respect of the preparation, and the agreement or determination of the Completion Accounts and the Statement and any subsequent adjustment
to the Break Option Price. 

  

	8.	ENFORCEMENT OPTION PRICE 

  

	8.1	In consideration for the purchase of the Option Shares pursuant to the exercise of the Enforcement Option, the Buyer shall: 

  

	 	8.1.1	pay the Enforcement Option Price, by paying to the Seller: 

  

	 	(a)	on the Enforcement Option Completion Date, the Additional Capital Expenditure Amount (if any) and the Enforcement Fee; and 

  

	 	(b)	within three (3) Business Days of the earlier of (a) the Sales Completion Date and; (b) the Sales Proceeds Date, the Redemption Fee (if any); and 

  

	 	8.1.2	take the steps set out in Clause 9. 

  

	9.	DISCHARGE OF FINANCE PARTY LIABILITIES 

  
 The Buyer shall on and as from the Option Completion Date: 
  

	 	9.1.1	fully and irrevocably discharge, or procure the full and irrevocable discharge of, all the Finance Party Liabilities; and 

  

	 	9.1.2	fully and irrevocably release, or procure the full and irrevocable release of, all the Security. 

  

	10.	EXPERTS 

  

	10.1	Promptly after the Option Time, the Buyer and Seller shall, in accordance with Clause 10.3, appoint: 

  

	 	10.1.1	a Financial Expert; and 

  

	 	10.1.2	a Technical Expert, 

  
 (together, the “Experts” and each, an “Expert”). 
  

	10.2	Each Expert shall act as an expert and not as an arbitrator and the law of arbitration shall not apply. 

  

	10.3	If within 15 Business Days of the Option Time, the Buyer and the Seller cannot agree on the identity of an Expert, then the identity of such Expert shall be chosen by:

  

	 	10.3.1	if such dispute relates to the appointment of the Financial Expert, the President for the time being of the Institute of Chartered Accountants of England and Wales; and

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 17 -	  	 

	 	10.3.2	if such dispute relates to the appointment of the Technical Expert, the President for the time being of the UK Institute of Civil Engineers. 

  

	10.4	Unless otherwise set out in this Agreement, or if the Buyer and Seller otherwise agree, the fees and expenses of the Experts shall be borne equally by the Buyer and the Seller.

  

	10.5	Each Expert shall carry out such determinations as are required under this Agreement. 

  

	11.	SALES 

  

	11.1	If, during the Sales Period, all, or any of, the Option Shares and/or all, or any part of, the Business and/or the Station Assets are sold for cash or other consideration, the Buyer
shall, or if it is not the Transferee at such time, shall procure that the Transferee shall, use its reasonable endeavours and all appropriate diligence to sell such Option Shares and/or all, or any such part of, the Business and/or the Station
Assets at the best obtainable market price and terms and conditions for such sale. 

  

	11.2	The Seller shall at all times have the right to identify potential purchasers to the Transferee. 

  

	12.	EVALUATION OF BREAK OPTION 

  

	12.1	The Seller and the Company will permit: 

  

	 	12.1.1	the Buyer; 

  

	 	12.1.2	any prospective purchaser of the Option Shares who has executed a Confidentiality Undertaking; and/or 

  

	 	12.1.3	an independent engineer complying with the requirements set out in the definition of the Technical Expert and appointed by the Buyer, at the sole cost of the Buyer (an
“Independent Engineer”), 

  
 upon
5 Business Days prior written notice, to have access during business hours on any Business Day falling not more than nineteen months prior to the Break Option Completion Date to: 
  

	 	12.1.4	the Station Assets (other than Records and financial information); and 

  

	 	12.1.5	all historic Records and information of the Company (but excluding information relating to the operating regime of the Station Assets or any Record or information containing
forecasts and/or projections), 

  
 in order to
prepare an evaluation of the Station Assets, the Option Shares, the Company and/or the Break Option (an “Evaluation”), provided that: 
  

	 	12.1.6	the process and scope of such access has been agreed by the Buyer and the Seller acting reasonably following good faith consultation; and 

  

					
	
	  	 	  	 
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	  	- 18 -	  	 

	 	12.1.7	such access does not significantly interfere with the commercial operation of the Station by the Company. 

  

	12.2	If the Buyer wishes to disclose the Evaluation to any third party other than a Finance Party, it shall notify the Seller of the identity of such person. No Finance Party (including
the Buyer) shall disclose the Evaluation to any third party without the due execution by such third party of a Confidentiality Undertaking. 

  

	12.3	Access to the Station Assets and/or the Records by an Independent Engineer shall be conditional upon the entry by such person into all such disclaimers or other undertakings as may
reasonably be required by the Seller from time to time. 

  

	13.	CALCULATION OF REDUCTION AMOUNT 

  

	13.1	Upon appointment of the Experts pursuant to Clause 10, the Buyer shall request the Technical Expert to prepare an evaluation as to the condition of the Station (the
“Evaluation Report”) so as to assess: 

  

	 	13.1.1	the extent to which the Company has failed to comply with any of the covenants set out in clauses 15.8, 15.10, 15.13, 15.16, 15.17, 15.18, 15.20, 15.23, 15.27, 15.30 and 15.31 of
the Credit Agreement (the “Covenants”) as at the Break Option Completion Date; and 

  

	 	13.1.2	together with the Financial Expert, the extent to which this has caused a material reduction in the value of the Station from the value that the Station would have been worth on the
Break Option Completion Date had it been operated at all times in accordance with the Covenants (the “Reduction Amount”). The reference terms to be used by the Technical Expert in preparing the Evaluation Report, the preparation and
the agreement or determination of any breach of any Covenant and any consequent adjustment to be made to the Break Fee calculation shall be agreed between the Buyer and the Seller no later than three (3) months prior to the Break Option Completion
Date. 

  

	13.2	The Buyer shall ensure that the Technical Expert shall submit the Evaluation Report to the Buyer and the Seller no later than the Break Option Completion Date.

  

	13.3	Within thirty (30) Business Days of the date of receipt of the Evaluation Report, the Seller shall notify the Buyer whether or not it agrees with the Evaluation Report.

  

	13.4	If the Seller notifies the Buyer of its agreement with the Evaluation Report within the thirty (30) Business Day period referred to in Clause 13.3 or fails to give any notification
within that period, the Evaluation Report shall be final and binding on the Buyer and the Seller and the Break Fee shall be adjusted downwards by an amount equal to the Reduction Amount (if any). 

  

	13.5	If the Seller notifies the Buyer within the thirty (30) Business Day period referred to in Clause 13.3 that it disagrees with the Evaluation Report, Clause 13.6 applies.

  

					
	
	  	 	  	 
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	  	- 19 -	  	 

	13.6	If, within ten (10) Business Days starting on the Business Day after receipt of a notification referred to in Clause 13.5, the Seller and the Buyer have not agreed the items in
dispute in relation to the Evaluation Report, the Buyer or the Seller may refer the matters in dispute to a partner of at least 10 years qualified experience at an independent firm of engineers agreed by the Buyer and the Seller in writing or,
failing agreement on the identity of the firm of engineers within fifteen (15) Business Days starting on the Business Day after receipt of the notification referred to in Clause 13.5, an independent firm of engineers appointed (on the application of
either the Buyer or the Seller) by the President for the time being of the Institution of Civil Engineers in England and Wales (the “Covenant Expert”). 

  

	13.7	The Covenant Expert shall act on the following basis: 

  

	 	13.7.1	as an expert and not as an arbitrator; 

  

	 	13.7.2	the Covenant Expert’s terms of reference shall be to determine the matters in dispute in respect of the Evaluation Report, within ten (10) Business Days of his appointment;

  

	 	13.7.3	the Covenant Expert may engage a Financial Expert to the extent necessary to assist it with all or any part of a dispute that is financial in nature; 

  

	 	13.7.4	the Buyer, the Seller and the Company shall each provide the Covenant Expert with all information which the Covenant Expert reasonably requires and the Covenant Expert shall be
entitled (to the extent he considers appropriate) to base his determination on such information and on the accounting and other records of the Company; and 

  

	 	13.7.5	if the Covenant Expert determines that a material adjustment of the Break Fee is required, the Seller shall pay the reasonable costs of the Technical Expert and the Covenant Expert,
otherwise the Buyer and the Seller shall each pay one half of the costs. 

  

	13.8	The Evaluation Report adjusted in accordance with (as the case may be): 

  

	 	13.8.1	the agreement, if any, between the Seller and the Buyer pursuant to Clause 13.6; or 

  

	 	13.8.2	the decision of the Covenant Expert in accordance with this Clause 13.7, 

  
 shall be final and binding on the Buyer and the Seller, save in the event of fraud or manifest error and the Break Fee shall be adjusted downwards by an
amount equal to the Reduction Amount (if any). 
  

	13.9	The Covenant Expert’s determination shall not be subject to the law of arbitration. 

  

	14.	FAILURE TO TRANSFER 

  

	14.1	If the Seller is obliged to transfer title to the Option Shares in accordance with Clause 15 or 16 (as the case may be) but has 

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 20 -	  	 

 failed to do so by the date falling 5 Business Days, or if the Seller is actively assisting the Buyer
with such transfer, 30 Business Days after the Option Completion Date (the “Long-Stop Date”) the Buyer shall other than in circumstances where such failure is directly attributable to a Finance Party: 
  

	 	14.1.1	be entitled to exercise its rights under clauses 18.1 and 18.2(a)(i) of the Credit Agreement in respect of all amounts accrued but unpaid under the Finance Documents (other than
this Agreement) on the Long-Stop Date (unless the Buyer has assigned all of its rights under this Agreement and the new owner of such rights is not owed all of the Finance Party Liabilities); and 

  

	 	14.1.2	on the earlier of the Sales Completion Date and the Sales Proceeds Date, have a liquidated damages claim for an amount equal to the Indemnity Amount. 

  

	14.2	Notwithstanding the failure to transfer the Option Shares in accordance with Clause 15 or 16 (as the case may be), the Buyer shall comply with its obligations under the Share
Subscription Agreement. 

  

	14.3	Receipt by the Buyer of all amounts under this Clause 14, shall extinguish fully and irrevocably the Finance Party Liabilities and the Buyer shall deliver to the Seller evidence (in
form and substance satisfactory to the Seller) that: 

  

	 	14.3.1	the Finance Party Liabilities have been fully and irrevocably discharged; and 

  

	 	14.3.2	the Security has been fully and irrevocably released. 

  

	15.	BREAK OPTION COMPLETION 

  

	15.1	Break Option Completion shall take place by 3.00 p.m. on the Break Option Completion Date at the Seller’s registered office, or at another place agreed by the Seller and the
Buyer. 

  

	15.2	At Break Option Completion the Seller and the Buyer shall sign the Escrow Letter in the agreed form and the Buyer shall deliver the Escrow Letter to the Escrow Agent as soon as
practicable at Break Option Completion. 

  

	15.3	At Break Option Completion: 

  

	 	15.3.1	the Seller shall: 

  

	 	(a)	give to the Buyer a duly completed transfer of the Option Shares in favour of the Buyer (or as it directs) and a share certificate in respect of all the Option Shares or, where
appropriate, renounceable documents of title; and 

  

	 	(b)	sign all documents and take all other action necessary to enable the Buyer (or its nominee) to become the registered and beneficial owner of the Option Shares including the use of
its voting and other rights arising by its holding of shares in the capital of the Company to ensure that the Buyer’s (or its nominee’s) name is entered in the register of members of the Company as the holder of the Option Shares; and

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 21 -	  	 

	 	15.3.2	the Buyer shall: 

  

	 	(a)	pay the Additional Capital Expenditure Amount due (if any) in full to the Seller in accordance with Clause 7.1.1(a); 

  

	 	(b)	deliver the Break Fee to the Escrow Agent in full and ensure that this amount is immediately deposited into the Escrow Account; 

  

	 	(c)	deliver to the Seller written evidence (in form and substance satisfactory to the Seller) that: 

  

	 	(i)	the Finance Party Liabilities have been fully and irrevocably discharged; and 

  

	 	(ii)	the Security has been fully and irrevocably released; and 

  

	 	(d)	comply with its, and procure that the Company complies with its, obligations under the Share Subscription Agreement. 

  

	15.4	The Buyer and the Seller agree that money in the Escrow Account shall only be used in accordance with the provisions set out in Clause 21 and in the Escrow Letter. The Buyer and the
Seller shall each ensure that all rights to the Escrow Account remain free from any Encumbrance, set-off or counterclaim except as referred to in Clause 21. 

  

	16.	ENFORCEMENT OPTION COMPLETION 

  

	16.1	Enforcement Option Completion shall take place by 3.00 p.m. on the Enforcement Option Completion Date at the place determined by the Buyer. 

  

	16.2	At Enforcement Option Completion: 

  

	 	16.2.1	the Seller shall: 

  

	 	(a)	give to the Buyer a duly completed transfer of the Option Shares in favour of the Buyer (or as it directs) and a share certificate in respect of all the Option Shares or, where
appropriate, renounceable documents of title; and 

  

	 	(b)	sign all documents and take all other action necessary to enable the Buyer (or its nominee) to become the registered and beneficial owner of the Option Shares including the use of
its voting and other rights arising by its holding of shares in the capital of the Company to ensure that the Buyer’s (or its nominee) name is entered in the register of members of the Company as the holder of the Option Shares; and

  

	 	16.2.2	the Buyer shall: 

  

	 	(a)	pay the Additional Capital Expenditure Amount due (if any) and the Enforcement Fee in full to the Seller in accordance with Clause 8.1.1(a); and 

  

					
	
	  	 	  	 
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	  	- 22 -	  	 

	 	(b)	deliver to the Seller written evidence (in form and substance satisfactory to the Seller) that: 

  

	 	(i)	the Finance Party Liabilities have been fully and irrevocably discharged; and 

  

	 	(ii)	the Security has been fully and irrevocably released; and 

  

	 	(c)	comply with its, and procure that the Company complies with its, obligations under the Share Subscription Agreement. 

  

	17.	POST BREAK OPTION COMPLETION 

  

	17.1	Promptly upon the determination of the Adjusted Break Fee in accordance with this Agreement, all amounts standing to the credit of the Escrow Account shall be disbursed as follows:

  

	 	17.1.1	if the Adjusted Break Fee exceeds the amount standing to the credit of the Escrow Account, the Buyer shall pay to the Seller the amount of the excess, together with an amount
equivalent to interest on the amount of the excess at the rate of LIBOR plus one (1) per cent. per annum for the period from the Break Option Completion Date to the date of payment and all amounts standing to the credit of the Escrow Account shall
be paid to the Seller; or 

  

	 	17.1.2	if the Adjusted Break Fee payable under Clause 7 is less than the amount standing to the credit of the Escrow Account, such amounts shall be disbursed as follows:

  

	 	(a)	the Adjusted Break Fee shall be paid to the Seller, together with the interest that has accrued on the Adjusted Break Fee in the period from the Break Option Completion Date to the
date of payment; and 

  

	 	(b)	the balance (if any) on the Escrow Account shall be paid to the Buyer. 

  

	18.	APPROVED FUEL CONTRACTS 

  

	18.1	Immediately prior to the Option Completion Date, BEPET’s rights and obligations under any Approved Fuel Contracts shall be novated to the Company so that:

  

	 	18.1.1	the Company shall be: 

  

	 	(a)	responsible for performing all the rights and obligations under or arising in respect of such Approved Fuel Contracts; 

  

	 	(b)	responsible for all liabilities, claims and demands howsoever and whenever arising under such Approved Fuel Contracts; and 

  

	 	(c)	be bound by the terms of such Approved Fuel Contracts in every way as if it had at all times been a party to such Approved Fuel Contracts in place of BEPET,

  
 in each case, on and following the novation;
and 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 23 -	  	 

	 	18.1.2	the Company shall release and discharge BEPET from all further performance under such Approved Fuel Contracts and from all liabilities, claims and demands howsoever and whenever
arising under such Approved Fuel Contracts. 

  

	19.	PURCHASE OF APPROVED FUEL 

  

	19.1	On the Option Completion Date, the Fuel Expert shall carry out the Fuel Survey. BEPET shall pay the reasonable costs incurred by the Fuel Expert in carrying out the Fuel Survey.

  

	19.2	No later than thirty (30) days after the Option Completion Date: 

  

	 	19.2.1	BEPET shall sell and the Buyer shall buy all the Actual Approved Fuel (including any Actual Approved Fuel that has subsequently been burnt at the Station post the Option Completion
Date); and 

  

	 	19.2.2	the Buyer shall pay the Approved Fuel Price to BEPET or as BEPET directs in writing by transfer of funds for same day value to such account as shall have been notified to the Buyer
by BEPET at least (3) Business Days before the Option Completion Date. 

  

	19.3	In the absence of manifest error, the determinations of the Fuel Expert made pursuant to this Clause 19 shall be final, conclusive and binding on BEPET and the Buyer.

  

	20.	RELEASE OF COLLATERAL 

  

	20.1	The Company shall, and the Buyer shall take all reasonable steps to procure that the Company shall: 

  

	 	20.1.1	from the Option Completion Date, procure that any cash collateral, financial or other guarantee, indemnity, undertaking or bond (as the case may be) provided by a Seller’s
Group Company (other than the Company) (the “Collateral Provider”) for and on behalf of the Company, including under or in respect of the Industry Documents (each an “Intra-Group Obligation”), shall be
unconditionally and irrevocably released if reasonably possible on, or if not, as soon as reasonably possible thereafter, the Option Completion Date; and 

  

	 	20.1.2	on each date on which any cash collateral is released in accordance with Clause 20.1.1 above and paid to the Company and provided that such collateral is not accounted for in the
Completion Accounts, pay an amount equal to such cash collateral to the relevant Collateral Provider. 

  

	20.2	Pending the release of any Collateral Provider from all liability under or in respect of an Intra-Group Obligation, the Buyer shall indemnify each Collateral Provider on demand in
respect of all costs, fees or other charges incurred on or after the Option Completion Date by each Collateral Provider under or in respect of such Intra-Group Obligation. This indemnity shall survive termination of this Agreement.

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 24 -	  	 

	20.3	The Company shall, and the Buyer shall procure that the Company shall: 

  

	 	20.3.1	on and from the Option Completion Date, procure that any cash collateral, financial or other guarantee, indemnity, undertaking or bond (as the case may be) provided by the Company
prior to the Option Completion Date under or in respect of: 

  

	 	(a)	the Industry Documents; 

  

	 	(b)	the Gale Common Licence (including under the Gale Common Escrow Agreement); and 

  

	 	(c)	the Heavy Fuel Oil Agreement 

  
 the Heavy Fuel Oil Agreement 
 is unconditionally and
irrevocably released if reasonably possible on, or if not, as soon as reasonably possible thereafter, the Option Completion Date; and 
  

	 	20.3.2	on each date on which any cash collateral is released in accordance with Clause 20.3.1 above, pay an amount equal to such cash collateral to the Seller. 

  

	21.	ESCROW ACCOUNT 

  

	21.1	If the Seller or the Buyer is entitled to money from the Escrow Account, the Seller and the Buyer shall promptly (and in any event within seven days of the date on which the
entitlement arises) (the “Due Date”) jointly instruct the Escrow Agent in writing to release the money to the Seller and/or the Buyer (as the case may be) together with an amount (less any tax and other amount the Escrow Agent is
legally required to deduct from that amount) equal to the interest actually accrued on such sum (accrued daily and compounded monthly) calculated for the period from the Option Completion Date to the date of payment (both dates inclusive).

  

	21.2	Interest accruing from time to time on the balance of money standing to the credit of the Escrow Account shall be added to the money standing to the credit of the Escrow Account and
shall form part of it for the purposes of this Clause 21. 

  

	21.3	The Seller and the Buyer shall each pay one half of the Escrow Agent’s costs in respect of any work done pursuant to this Clause 21. 

  

	21.4	The Buyer and the Seller acknowledge that the Escrow Agent may withdraw from the Escrow Account an amount of tax on the interest earned in respect of money held in the Escrow
Account for which it is or may become liable. 

  

	21.5	If either the Buyer or the Seller fails to give an instruction pursuant to Clause 21.1 in accordance with the provisions of this Agreement, the party in default shall pay interest
on the sum concerned from the Due Date until the date on which its obligation to pay the money is discharged at the rate of LIBOR plus one (1) per cent. per annum. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 25 -	  	 

	22.	PENSIONS 

  

	22.1	The Buyer shall enter into all such documents and do all such other things as may be necessary in order to procure (subject to the consent of any third party that may be required
including the Inland Revenue) that, with effect from the Option Completion Date: 

  

	 	22.1.1	the Buyer shall be appointed as the Principal Employer of the British Energy Combined Group (the “BECG”) of the Electricity Supply Pension Scheme (the
“ESPS”), in substitution for the Seller’s Group Company that is the Principal Employer of the BECG immediately before the Option Completion Date (the “Existing Principal Employer”); 

  

	 	22.1.2	those Employees who are in contributing service under the BECG immediately before the Option Completion Date shall continue in contributing service under the BECG on the same terms
from the Option Completion Date (although this shall not be construed so as to prevent the Buyer from subsequently providing benefits applicable under the BECG for the Employees under a different arrangement); and 

  

	 	22.1.3	the Existing Principal Employer (and each other Seller’s Group Company that has participated in the BECG before the Option Completion Date) shall be discharged from all
functions, duties, obligations and liabilities whatsoever in respect of the Employees and those members who, immediately prior to ceasing active membership of the BECG for the last time were employed by the Company, under and in relation to the BECG
and the Buyer shall undertake full responsibility for all such functions, duties, obligations and liabilities, whether arising before or after the Option Completion Date. The Existing Principal Employer shall remain liable for all other functions,
duties, obligations and liabilities arising out of or in connection with any other member of the BECG. 

  

	22.2	The Seller shall lend all reasonable assistance as the Buyer may request in relation to the Buyer’s obligations under Clause 22.1. The Buyer and the Seller shall co-operate
with a view to ensuring an orderly transfer of the BECG to the Buyer as provided for in Clause 22.1, including in relation to: 

  

	 	22.2.1	changing the Group Trustees and the Group Administrator of the BECG; and 

  

	 	22.2.2	making appropriate alternative arrangements for the administration of the BECG, if any Seller’s Group Company is a party to those arrangements immediately before the Option
Completion Date. 

  

	22.3	From the Option Completion Date, the Buyer shall indemnify, and keep indemnified, the Seller on demand against each loss, liability and/or cost which the Seller incurs, or which is
asserted against or demanded from the Seller, under or in relation to the BECG as a result of the Buyer’s failure to comply with its obligations under Clause 22.1 and each loss, liability and/or 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 26 -	  	 

	    	cost incurred as a result of defending or settling a claim alleging such a liability. This indemnity shall survive termination of this Agreement. 

  

	22.4	From the Option Completion Date, the Seller shall indemnify, and keep indemnified, the Buyer on demand against each loss, liability and/or cost which the Buyer incurs, or which is
asserted against or demanded from the Buyer, under or in relation to the BECG in respect of those members of the BECG whose employer immediately prior to their last ceasing active membership of the BECG before the Option Completion Date was not the
Company, and each loss, liability and/or cost incurred as a result of defending or settling a claim alleging such a liability. This indemnity shall survive termination of this Agreement. 

  

	23.	WARRANTIES 

  

	23.1	The Seller warrants to the Buyer that each Warranty is true, accurate and not misleading at the date of this Agreement. 

  

	23.2	The Seller acknowledges that the Buyer is entering into this Agreement in reliance on each Warranty, which has also been given as a representation and with the intention of inducing
the Buyer to enter into this Agreement. 

  

	24.	RESTRICTIONS 

  

	24.1	Until the Option Completion Date the Seller may not (without having first obtained the Buyer’s written consent): 

  

	 	24.1.1	sell, transfer or otherwise dispose of any interest in any of the Option Shares or any right attaching to the Option Shares; or 

  

	 	24.1.2	create or allow to be created any Encumbrance over any of the Option Shares other than a Permitted Encumbrance. 

  

	25.	TAX AND OTHER COSTS AND EXPENSES 

  

	25.1	Upon the receipt of any amount under the Tax Deed of Covenant (as defined in the Credit Agreement), the Seller shall forthwith subscribe that amount for Deferred Shares (as defined
in the Share Subscription Agreement) in the Company and procure that the Company applies the proceeds of the share subscription in settlement of the Tax liability which gave rise to the payment under the Tax Deed of Covenant.

  

	25.2	The Seller hereby agrees that upon being given evidence reasonably satisfactorily to it that the Buyer has, solely as a result of the grant (but not the actual exercise or
completion) of the Option, paid stamp duty in respect of this Agreement or has accounted for stamp duty reserve tax in respect of the grant of the Option, the Seller will within 10 Business Days reimburse to the Buyer the amount of such stamp duty
or (as the case may be) stamp duty reserve tax. If the Seller so requests, the Buyer will use all reasonable endeavours to assist the Seller to minimise the stamp duty or stamp duty reserve tax due on the grant of the Option. For the avoidance of
doubt, all stamp duty or stamp duty reserve tax due in respect of the exercise of the Option or 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 27 -	  	 

	    	Completion shall be paid by the Buyer and will not be reimbursed by the Seller. If the Buyer so requests, the Seller will use all reasonable endeavours to assist the Buyer to
minimise the stamp duty or stamp duty land tax due on exercise of the Option. 

  

	25.3	The Seller and the Buyer shall make all reasonable efforts to ensure the Company ceases from the Option Completion Date, to be treated by HM Customs & Excise as a member of a
group with a Seller’s Group Company for the purposes of section 43 to 43C (inclusive) of the Value Added Tax Act 1994 and/or paragraph 6 of SI 2001/7 (Climate Change Levy). Where the Company is in a group for the purposes of Value Added Tax
(“VAT”) or Climate Change Levy (“CCL”) (or any substantially similar tax group) with a Seller’s Group Company after the Option Completion Date, such payments shall be made by the Company to, or to the Company
by, the representative member of the VAT, CCL or other group to ensure that (ignoring in the case of VAT, supplies between members of that VAT group) the representative member and the Company are put in the position they would have been had the
relevant group not been in existence from the Option Completion Date. The Seller and the Buyer shall take such steps as are reasonably within their powers for so long as may be reasonably necessary to give each other all the assistance and
co-operation as may be required to enable the representative member of any such VAT or CCL or other group to comply with its obligations as representative member of the relevant group. The Seller shall pay to the Buyer an amount equal to any
liability of the Company for VAT and/or CCL debts incurred by the Company in consequence of the joint and several liability of members of VAT or CCL groups where the liability is one the Company would not have incurred had no VAT or CCL group (as
the case may be) been in existence between the Company and a Seller’s Group Company. 

  

	25.4	The Buyer agrees with the Seller that if Completion takes place, the Buyer will procure that the Company does nothing after Break Option Completion or Enforcement Option Completion
(as the case may be) that will give rise to a liability under section 767A or section 767AA Income and Corporation Taxes Act 1988 (or similar legislation enacted after the date hereof but before Completion takes place) for a Seller’s Group
Company (or any person which is then or has been in control of a Seller’s Group Company, or is then or has been under the control of a Seller’s Group Company) in respect of or referable to Tax relating to income, profits or gains of the
Company arising after Completion except to the extent: 

  

	 	25.4.1	such income, profits or gains have in accordance with generally applicable accounting standards been treated in the Company’s accounts as arising prior to Completion; or

  

	 	25.4.2	that the liability only arises because of actions taken by a Seller’s Group Company (including the Company) before, or some actions undertaken before by a Seller’s Group
Company (including the Company) and some undertaken by the Buyer or the Company after, Completion provided that this exception shall not apply to any actions taken by the Buyer or, after Completion, the Company outside the ordinary course of
trading. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 28 -	  	 

	25.5	If any VAT is due in respect of any supply under this Agreement, the Buyer shall (against delivery of a valid VAT invoice), in addition to all other amounts due and payable by it
hereunder, also make payment of such VAT and any amount equal to any penalty or interest incurred by the Seller for the late payment of VAT resulting from any failure or delay by the Buyer in making such payment under this Clause 25.5.

  

	26.	PAYMENTS 

  

	26.1	All payments made by the Buyer or the Seller under this Agreement shall be made gross, free of any right of counterclaim or set-off and without deduction or withholding of any kind
other than any deduction or withholding required by law. 

  

	26.2	If the Buyer or the Seller makes a deduction or withholding required by law from a payment (other than a payment of interest) under this Agreement, the sum due from that party shall
be increased to the extent necessary to ensure that, after the making of any deduction or withholding, the party to whom such amount is payable (including an Indemnified Party or Indemnified Parties) receives a sum equal to the sum it would have
received had no deduction or withholding been made. 

  

	26.3	Nothing in this Clause 26 shall effect any obligation of the Escrow Agent which shall be governed instead by Clause 21. 

  

	27.	CONVERSION TO EUROS 

  

	27.1	With effect from the date (if any) that the United Kingdom adopts the Euro as its lawful currency in substitution for pounds sterling (the “Euro Effective Date”):

  

	 	27.1.1	payments falling due under this Agreement on or after the Euro Effective Date shall be made by the payer to the recipient in Euros; 

  

	 	27.1.2	no payments falling due after the Euro Effective Date which would have been payable in pounds sterling under this Agreement but for the adoption of the Euro by the United Kingdom as
its lawful currency shall be made in pounds sterling or national currency units; and 

  

	 	27.1.3	on the Euro Effective Date, all amounts stated in pounds sterling shall be converted into Euros at the fixed conversion rate provided for by the Laws of England and Wales and, on
and after the Euro Effective Date, all amounts required to be calculated in pounds sterling shall be calculated in Euros. 

  

	28.	INVALIDITY OR ILLEGALITY 

  

	28.1	If at any time any provision of this Agreement is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction (a “Relevant
Event”), that shall not affect or impair: 

  

	 	28.1.1	the legality, validity or enforceability in that jurisdiction of any other provision of this Agreement; or 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 29 -	  	 

	 	28.1.2	the legality, validity or enforceability under the law of any other jurisdiction of that or any other provision of this Agreement. 

  

	28.2	Immediately upon a party becoming aware of the occurrence or potential occurrence of a Relevant Event, each party shall use its reasonable endeavours to negotiate in good faith and
settle within thirty (30) Business Days an agreement or provision which as closely as possible reflects the financial and commercial intent of the parties under this Agreement or under the relevant provision which is the subject of the Relevant
Event. 

  

	29.	GENERAL 

  

	29.1	A variation of this Agreement is valid only if it is in writing and signed by or on behalf of each party. 

  

	29.2	The failure to exercise or delay in exercising a right or remedy provided by this Agreement or by law does not impair or constitute a waiver of the right or remedy or an impairment
of or a waiver of other rights or remedies. No single or partial exercise of a right or remedy provided by this Agreement or by law prevents further exercise of the right or remedy or the exercise of another right or remedy.

  

	29.3	Each date, time or period referred to in this Agreement is of the essence. If the parties agree in writing to vary a date, time or period, the varied date, time or period is of the
essence. 

  

	29.4	Except to the extent that they have been performed and except where this Agreement provides otherwise the obligations contained in this Agreement remain in force after the Option
Completion Date. 

  

	29.5	A person who is not a party to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement but this does not affect any
right or remedy of a third party which exists or is available apart from that Act. 

  

	30.	ENTIRE AGREEMENT 

  

	30.1	This Agreement and each document referred to in it constitute the entire agreement and supersede any previous agreement between the parties relating to the subject matter of this
Agreement. 

  

	30.2	The Buyer acknowledges that it has not relied on or been induced to enter into this agreement by any representation, warranty or undertaking (whether contractual or otherwise) given
by or on behalf of the Seller, its directors, officers or employees other than those expressly given in this Agreement. 

  

	30.3	The Seller is not liable to the Buyer (in equity, contract or tort (including negligence), under the Misrepresentation Act 1967 or in any other way) for a representation, warranty
or undertaking that is not set out in this Agreement. 

  

	30.4	The Seller acknowledges and represents that it has not relied on or been induced to enter into this Agreement by any representation, warranty or undertaking (whether contractual or
otherwise) given by or on behalf of the Buyer or any adviser other than those expressly given in this Agreement. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 30 -	  	 

	30.5	The Buyer is not liable to the Seller (in equity, contract or tort (including negligence), under the Misrepresentation Act 1967 or in any other way) for a representation, warranty
or undertaking that is not set out in this Agreement. 

  

	30.6	The Buyer has not entered into this Agreement in reliance on any representation, statement, assurance, covenant, undertaking, indemnity, guarantee or commitment of any kind
whatsoever and the Buyer will not have any remedy against the Seller in respect of any representation, statement, assurance, covenant, undertaking indemnity, guarantee, or commitment of any kind whatsoever made on or prior to the date of this
Agreement. 

  

	30.7	Nothing in this Clause 30 shall have the effect of limiting or restricting any liability arising as a result of any fraud, wilful misconduct or wilful concealment or for personal
injury or death resulting from negligence. 

  

	31.	ASSIGNMENT 

  

	31.1	No party may (nor purport to) assign or transfer, or declare a trust of the benefit of, or in any other way dispose of any of its rights under this Agreement, in whole or in part,
without first having obtained the other parties prior written consent, save that: 

  

	 	31.1.1	the Buyer shall be entitled to make a Disposal to a Third Party in accordance with Clauses 32 to 35; and 

  

	 	31.1.2	The Seller shall be entitled to assign and/or transfer all (but not part only) of its rights under this Agreement to BEH by way of security for the First Intercompany Loan
Agreement. 

  

	31.2	Subject to Clause 31.1.1, during the Close Period the Buyer may not enter into any agreement or other arrangement: 

  

	 	31.2.1	that relates to the exercise of any of its rights under this Agreement; or 

  

	 	31.2.2	to assign or transfer or declare a trust of the benefit of or in any other way dispose of all or any of the Option Shares after an Option Completion Date. 

 

	32.	SELLER’S OFFER 

  

	32.1	Prior to committing to make a Disposal to a Third Party, the Buyer shall first serve on the Seller: 

  

	 	32.1.1	a Disposal Notice, signed by the Buyer; 

  

	 	32.1.2	a copy of the Third Party Disposal Agreement; and 

  

	 	32.1.3	a Disposal Agreement in duplicate, one copy of which shall be signed by the Buyer. 

  

					
	
	  	 	  	 
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            separately with the Commission
	  	- 31 -	  	 

	32.2	The offer constituted by a Disposal Notice served on the Seller shall be irrevocable during the Acceptance Period. 

  

	33.	BUYER’S ENQUIRIES 

  
 After service of any Disposal Notice on the Seller and until the earlier of acceptance by the Seller of the offer constituted by such Disposal Notice or
the expiration of the Acceptance Period, the Buyer shall reply promptly and in writing to any reasonable enquiry put to them by the Seller or its advisers relating to the proposed Disposal, the Third Party Disposal Agreement and/or the Disposal
Agreement. In the event that the Buyer fails to reply within two (2) Business Days to any such enquiry, the Acceptance Period shall be extended by a period equal to the period commencing on the date such enquiry is made and ending on the date the
Buyer replies in writing to such enquiry. 
  

	34.	SELLER’S ACCEPTANCE 

  
 If the Seller wishes to accept the offer constituted by a Disposal Notice, a Seller’s Group Company shall do so by signing and dating the copy of the
Disposal Agreement served with such Disposal Notice and by returning it to the Buyer within the Acceptance Period. 
  

	35.	NON-ACCEPTANCE OF BUYER’S OFFER 

  

	35.1	If, within the Acceptance Period, a Seller’s Group Company does not accept the offer constituted by the Disposal Notice served on the Seller, the Buyer may, during the Disposal
Period, enter into the Third Party Disposal Agreement but at not less than the Third Party Purchase Price and otherwise on terms, in all material respects, the same as those contained in the Third Party Disposal Agreement served on the Seller with
such Disposal Notice. 

  

	35.2	The Buyer agrees with the Seller: 

  

	 	35.2.1	within 5 Business Days of the Buyer entering into the Third Party Disposal Agreement with a Third Party, to provide to the Seller a copy thereof, certified by the Buyer’s
Solicitors; and 

  

	 	35.2.2	within 5 Business Days of completion of the transaction contemplated by such Third Party Disposal Agreement, to notify the Seller in writing of such completion.

  

	35.3	If, by the date of expiration of the Disposal Period, the Buyer and the Third Party have not entered into the Third Party Disposal Agreement or, if the Buyer and the Third Party
have but the Disposal thereby contemplated has not been completed, the Buyer shall only make such Disposal (and/or any other Disposal) by again first complying with the provisions of Clauses 31 to 35. 

  

	36.	CONFIDENTIALITY 

  

	36.1	Subject to Clause 36.2, the Buyer may not, and the Buyer shall procure that each party to a Third Party Disposal Agreement and/or any Transferee shall not, disclose any Confidential
Information. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 32 -	  	 

	36.2	The Buyer may, and any party to a Third Party Disposal Agreement and/or any Transferee may: 

  

	 	36.2.1	disclose Confidential Information to any Finance Party, provided that such Finance Party has first entered into a confidentiality undertaking in form and substance reasonably
satisfactory to the Seller; 

  

	 	36.2.2	disclose any Confidential Information: 

  

	 	(a)	if and to the extent required by law or for the purpose of any judicial proceedings; 

  

	 	(b)	if and to the extent required by any securities exchange or regulatory or governmental body to which that party is subject or submits, wherever situated, including the Stock
Exchange, the Financial Services Authority or the Panel on Takeovers and Mergers, whether or not the requirement for information has the force of law; 

  

	 	(c)	to any of its directors or employees who needs to know such Confidential Information in order to discharge his duties; 

  

	 	(d)	to its professional advisers, auditors and bankers; 

  

	 	(e)	if and to the extent that the Buyer can demonstrate that the Confidential Information has come into the public domain through no fault of the Buyer; or 

  

	 	(f)	if and to the extent the Seller and the Company has given prior written consent; and 

  

	 	36.2.3	disclose any Confidential Information detailed in any Evaluation in accordance with Clause 12. 

  

	36.3	The restrictions contained in this Clause 36 shall continue to apply after the termination of this Agreement without limit in time. 

  

	37.	NOTICES 

  

	37.1	A notice or other communication under or in connection with this Agreement (a “Notice”) shall be: 

  

	 	37.1.1	in writing; 

  

	 	37.1.2	in the English language; and 

  

	 	37.1.3	delivered personally or sent by first class post pre-paid recorded delivery (and air mail if overseas) or by fax to the party due to receive the Notice to the address or fax number
set out in Clause 37.3 or to another address or fax number specified by that party by not less than five (5) Business Days written notice to the other party received before the Notice was despatched. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 33 -	  	 

	37.2	Unless there is evidence that it was received earlier, a Notice is deemed given if: 

  

	 	37.2.1	delivered personally, when left at the address referred to in Clause 37.3; 

  

	 	37.2.2	sent by mail, except air mail, two (2) Business Days after posting it; 

  

	 	37.2.3	sent by air mail, six (6) Business Days after posting it; and 

  

	 	37.2.4	sent by fax, when confirmation of its transmission has been recorded by the sender’s fax machine. 

  

	37.3	The address referred to in Clause 37.1.3 is: 

  

			
	 Name of party

	  	 Address

	 The Seller
	  	 Eggborough Power (Holdings) Limited
 3 Redwood
Crescent
 Peel Park
 East Kilbride
 G74 5PR
  
 Attention: Corporate Affairs Director and Company Secretary
  
 Telephone: 01355 594 020
  
 Facsimile: 01355 594
022

		
	 The Buyer
	  	 5 The North Colonnade
 Canary Wharf
 London
 E14 4BB
  
 Attention: ********

		
	 The Company
	  	 Eggborough Power Limited
 Barnett Way
 Barnwood
 Gloucester
 Gloucestershire
 GL4 3RS,
  
 Attention: Corporate Affairs Director and Company Secretary
  
 Telephone: 01355 594 020
  
 Facsimile: 01355 594 022

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 34 -	  	 

			
		
	BEPET	  	 British Energy Power and Energy Trading Limited
 3
Redwood Crescent
 Peel Park
 East Kilbride
 G74 5PR
  
 Attention: Corporate Affairs Director and Company Secretary
  
 Telephone: 01355 594 020
 Facsimile: 01355 594 022

  

	38.	TERM 

  

	38.1	Unless an Option has been exercised and not revoked hereunder; or (ii) a Clause is expressed to survive termination of this Agreement, all provisions of this Agreement shall
terminate on the earliest of the following: 

  

	 	38.1.1	the exercise by the Buyer of an Option (as defined in the Asset Option Agreement); 

  

	 	38.1.2	the occurrence of an Enforcement Event; 

  

	 	38.1.3	1 April 2010; and 

  

	 	38.1.4	otherwise with the agreement of all parties hereto. 

  

	39.	GOVERNING LAW AND JURISDICTION 

  

	39.1	This Agreement is governed by English law. 

  

	39.2	The courts of England have exclusive jurisdiction to settle any dispute arising from or connected with this Agreement (a “Dispute”). 

  

	39.3	The parties agree that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that they will not argue to the contrary.

  

	39.4	The parties agree that the documents which start any proceedings relating to a Dispute (“Proceedings”) and any other documents required to be served in relation to
those Proceedings may be served in accordance with Clause 37. These documents may, however, be served in any other manner allowed by law. This clause applies to all Proceedings wherever started. 

  

	40.	COUNTERPARTS 

  
 This Agreement may be executed in any number of counterparts, each of which when executed and delivered is an original and all of which together evidence
the same agreement. 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 35 -	  	 

 SCHEDULE 1 
  
 COMPLETION ACCOUNTS 
  

	1.	PART A 

  

	1.1	After the Option Completion Date the Buyer shall ensure that the Buyer’s Accountants prepare: 

  

	 	1.1.1	draft Completion Accounts; and 

  

	 	1.1.2	a draft Statement. 

  
 The Seller and the Buyer shall each pay one half of the Buyer’s Accountants’ costs incurred under this Paragraph 1.1. 
  

	1.2	Except as agreed between the Buyer and the Seller prior to the Restructuring Date, the draft Completion Accounts shall be prepared on a basis consistent with the balance sheet in
the Accounts, using the same accounting principles, policies and practices and, so far as consistent with the foregoing, applicable standards, principles and practices generally accepted in the United Kingdom as if they were statutory accounts
required to be prepared under the Act. In preparing the draft Completion Accounts, no account is to be taken of an event taking place after the Option Completion Date or of facts or circumstances only known to the Buyer and/or Seller after the
Option Completion Date, otherwise than pursuant to Paragraph 1.3. 

  

	1.3	After the Option Completion Date, the Seller shall provide the Buyer and the Buyer’s Accountants with access to those assets, documents and records within its possession or
control which they may reasonably require for the purpose of preparing and agreeing the draft Completion Accounts and the draft Statement. 

  

	1.4	The Buyer shall ensure that within forty (40) Business Days starting on the Business Day after the Option Completion Date, the Buyer’s Accountants submit to the Seller’s
Accountants: 

  

	 	1.4.1	the draft Completion Accounts, their working papers, and a report by the Buyer’s Accountants addressed to the Buyer and the Seller stating whether in their opinion the draft
Completion Accounts have been prepared in accordance with Paragraph 1.2; and 

  

	 	1.4.2	the draft Statement. 

  

	1.5	Within twenty-five (25) Business Days starting on the Business Day after receipt of the draft Completion Accounts and the draft Statement, the Seller shall notify the Buyer whether
or not it agrees with the draft Completion Accounts and the draft Statement. The Buyer shall ensure that the Seller and the Seller’s Accountants are given access to all additional information they may reasonably require to enable the Seller to
make its decision. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 36 -	  	 

	1.6	If the Seller notifies its agreement with the draft Completion Accounts and the draft Statement within the twenty-five (25) Business Day period referred to in Paragraph 1.5 or fails
to give any notification within that period, the draft Completion Accounts and the draft Statement shall cease to be drafts and be final and binding on the Buyer and the Seller. 

  

	1.7	If the Seller notifies the Buyer within the twenty-five (25) Business Day period referred to in Paragraph 1.5 that it disagrees with the draft Completion Accounts or with the draft
Statement, Paragraph 1.8 applies. 

  

	1.8	If, within ten (10) Business Days starting on the Business Day after receipt of the notification referred to in Paragraph 1.7, the Seller and the Buyer have not agreed the items in
dispute in relation to the draft Completion Accounts or the draft Statement the Buyer or Seller may refer the matters in dispute to a partner of at least 10 years qualified experience at an independent firm of chartered accountants agreed by the
Buyer and Seller in writing or, failing agreement on the identity of the firm of chartered accountants within fifteen (15) Business Days starting on the Business Day after receipt of the notification referred to in Paragraph 1.7, to an independent
firm of chartered accountants appointed on the application of either the Buyer or Seller by the President for the time being of the Institute of Chartered Accountants in England and Wales (the “Determinator”).

  

	1.9	The Determinator shall act on the following basis: 

  

	 	1.9.1	as an expert and not as an arbitrator; 

  

	 	1.9.2	the Determinator’s terms of reference shall be to determine the matters in dispute in respect of the draft Completion Accounts and draft Statement within twenty (20) Business
Days of his appointment; 

  

	 	1.9.3	the Buyer and Seller shall each provide the Determinator with all information relating to the Company which the Determinator reasonably requires and the Determinator shall be
entitled (to the extent he considers appropriate) to base his determination on such information and on the accounting and other records of the Company; 

  

	 	1.9.4	the decision of the Determinator shall, in the absence of fraud or manifest error, be final and binding on the Buyer and the Seller; and 

  

	 	1.9.5	the Seller and the Buyer shall each pay one half of the Determinator’s costs or as the Determinator may determine. 

  

	1.10	The draft Completion Accounts and the draft Statement adjusted in accordance with the agreement, if any, between the Seller and the Buyer pursuant to Paragraph 1.8 or (as the case
may be) the decision of the Determinator in accordance with Paragraph 1.9 shall cease to be drafts and be final and binding on the Buyer and the Seller. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 37 -	  	 

 SCHEDULE 2 
  
 FORM OF SHARE OPTION NOTICE 
  
 [BUYER’S LETTERHEAD] 
  

	To:	Eggborough Power (Holdings) Limited 

 3 Redwood
Crescent 
 Peel Park 
 East
Kilbride 
 G74 5PR 
  

	cc.	British Energy Power and Energy Trading Limited 

 3 Redwood
Crescent 
 Peel Park 
 East
Kilbride 
 G74 5PR 
  
 Eggborough Power Limited 
 Barnett Way

 Barnwood 
 Gloucester

 Gloucestershire 
 GL4
3RS 
  
 Date: [·] 
  
 BY
HAND 
  
 BY REGISTERED/RECORDED DELIVERY POST 
  
 SHARE OPTION NOTICE 
  

	1.	We refer to the Share Option Agreement dated      September 2004 between Eggborough Power (Holdings) Limited, Barclays Bank PLC, Eggborough Power Limited
and British Energy Power and Energy Trading Limited (the “Share Option Agreement”). 

  

	2.	Terms defined in the Share Option Agreement shall have the same meanings in this Share Option Notice unless the context requires otherwise. References to a “Clause”
are to a clause of the Share Option Agreement. 

  

	3.	The Buyer hereby notifies the Seller pursuant to Clause 4.1.2 that it wishes to exercise the Option granted in Clause 3.1.1. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 38 -	  	 

	4.	The Option Completion Date shall be the Break Option Completion Date. 

  
  

 Signed by [·] 
 Director/Secretary 
 for and on behalf of 
 Barclays Bank PLC 
 acting as agent and security trustee 
 for the Finance Parties 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 39 -	  	 

 SCHEDULE 3 
  
 FORM OF ENFORCEMENT OPTION NOTICE

  
 [BUYER’S LETTERHEAD] 
  

	To:	Eggborough Power (Holdings) Limited 

 3 Redwood
Crescent 
 Peel Park 
 East
Kilbride 
 G74 5PR 
  

	cc.	British Energy Power and Energy Trading Limited 

 3 Redwood
Crescent 
 Peel Park 
 East
Kilbride 
 G74 5PR 
  
 Eggborough Power Limited 
 Barnett Way

 Barnwood 
 Gloucester

 Gloucestershire 
 GL4
3RS 
  
 Date: [·] 
  
 BY
HAND 
  
 BY REGISTERED/RECORDED DELIVERY POST 
  
 ENFORCEMENT OPTION NOTICE 
  

	1.	We refer to the Share Option Agreement dated      September 2004 between Eggborough Power Holdings Limited, Barclays Bank PLC, Eggborough Power Limited
and British Energy Power and Energy Trading Limited (the “Share Option Agreement”). 

  

	2.	Terms defined in the Share Option Agreement shall have the same meanings in this Share Option Notice unless the context requires otherwise. References to a “Clause”
are to a clause of the Share Option Agreement. 

  

	3.	The Buyer hereby notifies the Seller pursuant to Clause 5.1.2 that it wishes to exercise the Option granted in Clause 3.1.2. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 40 -	  	 

	4.	The Buyer hereby notifies the Seller that the Enforcement Option Completion Date shall be [•]. 

  
  

 Signed by [·] 
 Director/Secretary 

for and on behalf of 
 Barclays Bank PLC 
 acting as agent and security 
 trustee for the Finance Parties 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 41 -	  	 

 (On duplicate) 
  
 Eggborough Power (Holdings) Limited acknowledges receipt of the notice from Barclays Bank PLC of which this is a duplicate, and confirms acceptance of its terms.

  
 Dated: [·] 
  
  

 Signed by [·]

 Director/Secretary 
  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 42 -	  	 

 SCHEDULE 4 
  
 WARRANTIES 
  
 Incorporation and existence 
  

	1.	The Seller is a limited company incorporated under Scottish law and has been in continuous existence since incorporation. 

  
 Right, power, authority and action 
  

	2.	The Seller has the right, power and authority, and has taken all action necessary, to execute, deliver and exercise its rights, and perform its obligations, under this Agreement.

  

	3.	The Seller has the right, power and authority to conduct its business as conducted at the date of this Agreement. 

  
 Binding agreements 
  

	4.	The Seller’s obligations under this Agreement are enforceable in accordance with their terms. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 43 -	  	 

 SCHEDULE 5 
  
 INSTRUCTION LETTER TO ESCROW AGENT

  

	TO:	[insert name and address of Escrow Agent] 

  
  
  
 Dear Sirs

  
 Escrow Account 
  
 We are writing to confirm the terms on which money deposited with you today by Barclays Bank
PLC (the “Buyer”) (the “Escrow Fund”) is to be held by you on trust for us. These terms are: 
  

	1.	You shall maintain the Escrow Fund in a separately designated interest-bearing account with [Bank] in your name. 

  

	2.	Subject to Paragraph 4 below, you shall pay or hold the Escrow Fund (or any part of it) to or for the person or in the manner directed in our joint written instructions.

  

	3.	If either of us (the “Payee”): 

  

	3.1	notifies you that the other is in breach of its obligation to notify or has not complied with its obligation to instruct you to pay an amount in accordance with the share option
agreement dated      September 2004 between us, Eggborough Power Limited and British Energy Power and Energy Trading Limited; and 

  

	3.2	produces evidence in writing that the other has accepted that the Payee is entitled to be paid the amount notified or a decision of a tax authority or a judgment of a court of
competent jurisdiction against which no appeal has been lodged or is capable of being lodged within the statutory time limit to the effect that the Payee is entitled to be paid the amount notified, you shall pay or hold the amount notified to or for
the Payee or in the manner directed in the Payee’s written instructions. 

  

	4.	You may withdraw from the Escrow Fund an amount of tax on the interest earned in respect of the Escrow Fund for which you are or may become liable. 

  

	5.	We shall each pay one half of your costs in respect of any work done pursuant to the terms of this letter. 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 44 -	  	 

	6.	This letter shall be governed by and construed in accordance with English law. 

  

Yours sincerely 
  
  

	
	

	 Signed by [·]

	 Director/Secretary

	 for and on behalf of

	Eggborough Power (Holdings) Limited
	
	  

	 Signed by [·]

	 Director/Secretary

	 for and on behalf of

	Barclays Bank PLC
	 acting as agent and

	 security trustee for the

	 Finance Parties

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 45 -	  	 

 SCHEDULE 6 
  
 ENFORCEMENT FEE 
  
 £ (millions) 
  

															
	From:	  	April-03	  	April-04	  	April-05	  	April-06	  	April-07	  	April-08	  	April-09
	 To:

	  	March-04

	  	March-05

	  	March-06

	  	March-07

	  	March-08

	  	March-09

	  	August-09

	 April
	  	—  	  	29	  	57	  	76	  	89	  	104	  	104
	 May
	  	—  	  	32	  	58	  	77	  	91	  	104	  	104
	 June
	  	—  	  	34	  	60	  	78	  	92	  	104	  	104
	 July
	  	—  	  	36	  	62	  	79	  	93	  	104	  	104
	 August
	  	—  	  	39	  	63	  	80	  	95	  	104	  	104
	 September
	  	—  	  	41	  	65	  	81	  	96	  	104	  	 
	 October
	  	—  	  	43	  	66	  	83	  	97	  	104	  	 
	 November
	  	5	  	46	  	68	  	84	  	99	  	104	  	 
	 December
	  	10	  	48	  	70	  	85	  	100	  	104	  	 
	 January
	  	16	  	50	  	71	  	86	  	101	  	104	  	 
	 February
	  	21	  	53	  	73	  	87	  	103	  	104	  	 
	 March
	  	27	  	55	  	75	  	88	  	104	  	104	  	 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 46 -	  	 

 SCHEDULE 7 
  
 FORM OF DISPOSAL NOTICE 
  

					
	To:	  	 Eggborough Power (Holdings) Limited
 3 Redwood
Crescent
 Peel Park
 East Kilbride
 G74 5PR
	  	 BY HAND
 or
 BY REGISTERED/RECORDED
 DELIVERY POST

  

	1.	We refer to the Share Option Agreement (the “Option Agreement”) dated      September 2004 between Eggborough Power (Holdings) Limited,
Eggborough Power Limited, British Energy Power and Energy Trading Limited and Barclays Bank PLC. 

  

	2.	Terms defined in the Option Agreement shall have the same meanings in this Disposal Notice unless the context otherwise requires. 

  

	3.	We, Barclays Bank PLC Registration No. 01026167, as Buyer offer to make to you the Disposal referred to in the contract (being a Disposal Agreement (as defined in the Option
Agreement)) which accompanies this notice in duplicate, one copy of which has been signed by us. 

  

	4.	If you wish to accept the offer constituted by this notice, a Seller’s Group Company must do so by signing and dating the copy of the contract which has been signed by us and
then returning such copy to us within the Acceptance Period referred to in the Option Agreement. 

  

	
	 Dated [·]

	
	  

	 Director/Company Secretary for and

	 on behalf of Barclays Bank PLC

	 acting as agent and security

	 trustee for the Finance Parties

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 47 -	  	 

 SCHEDULE 8 
  
 CONFIDENTIALITY UNDERTAKING 
  
 STRICTLY PRIVATE AND CONFIDENTIAL 
  

	To:	[·] 

  
 Date:    [·] 
  
 Dear Sirs, 
  
 Eggborough Power Limited (registered number 03782700) (the
“Company”) 
  
 We understand that you wish to access the coal fired
power station located at Eggborough (the “Plant”) owned by us for the purposes of performing due diligence on the Plant including (but not limited to) engineering due diligence for the purposes of considering a potential direct or
indirect investment (that may include the purchase of an option to buy all the issued shares in the Company) (the “Permitted Purpose”). 
  
 Unless otherwise defined, terms in this letter have the same meaning as given in the Credit Agreement. 
  
 “Act” means the Companies Act 1985. 
  
 “Credit Agreement” means the credit agreement originally dated 13 July 2000 as amended and restated on 8 September 2000, 24
October 2000, 12 December 2000, 5 February 2001 and on or about the Restructuring Date between, inter alios, the Company and Barclays Bank PLC as agent and security trustee. 
  
 “Information” means information of whatever nature relating to the Group supplied to you or your advisers by or on behalf
of the Company or any other member of the Group in writing, orally or otherwise and includes any information obtained by you, in writing or orally, through discussions with the management, employees and advisers of the Company or any other member of
the Group, together with any reports, analyses, compilations, studies or other documents prepared by you or on your behalf which contain or otherwise reflect such information, but “Information” shall not include such information which is
in or which comes into the public domain other than as a result of: 
  

	(a)	a breach by you of the obligations imposed by this letter (or by any person to whom disclosure of information is made as permitted under this letter); or 

 

	(b)	a breach by you (or any other such person) of any other duty of confidentiality relating to that information. 

  

	1.	In consideration of the Company agreeing to supply you Information, you acknowledge that the Information is confidential and is received by you under a duty of confidentiality to
the Company and for the exclusive purpose of the Permitted Purpose, and you undertake with the Company as follows: 

  

	1.1	You will keep confidential and not disclose to any person, other than as permitted under Sub-paragraph 1.4, your interest in, and your discussions and negotiations with, the Banks,
the Company and any other member of the Group in connection with the Permitted Purpose; 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 48 -	  	 

	1.2	You will keep all Information confidential and in a secure place and not disclose any Information to any person, other than as permitted under Sub-paragraph 1.4;

  

	1.3	You will use Information solely for the Permitted Purpose and not for any other purpose; 

  

	1.4	You will not, without the prior written consent of the Company, disclose any Information to any person other than those of your senior executives, the senior executives of your
associated undertakings, employees and those members of your professional advisers who, in each case, need to know the Information for the purpose of evaluating or advising (as appropriate) in relation to the Permitted Purpose or (subject to
Sub-paragraph 1.6) as required by law or other regulation applicable to you save that, where you have acquired all the issued shares in the Company, you shall be entitled to disclose such information as would no longer be proprietary to the Group;

  

	1.5	You will procure that each person to whom disclosure of Information is made as permitted under Sub-paragraph 1.4 is made aware (in advance of disclosure) of the terms of this letter
and you will procure that each such person provides a confidentiality undertaking to you on substantially the same terms as this undertaking and also includes an express acknowledgement and confirmation that such person extends the terms of such
undertaking for the benefit of each member of the Group; and 

  

	1.6	You will promptly notify the Company and EPHL in writing if any Information is required to be disclosed by law or other regulation or any stock exchange whether in the United
Kingdom or elsewhere and cooperate with the Company its ultimate parent regarding the timing and content of such disclosure or any action which the Company or its ultimate parent may reasonably elect to take to challenge the validity of such
requirement. 

  

	2.	You further acknowledge and confirm to the Company that: 

  

	2.1	Your obligations under this letter shall extend to protect each and every member of the Group; and 

  

	2.2	Your obligations under this letter shall be continuing for a period of two years from the date of this letter, in particular they shall survive the termination of any discussions or
negotiations between you, the Company, and each other member of the Group and the Banks regarding the Plant and/or the issued shares in the Company. 

  

	3.	The Company and any other member of the Group are permitted to enforce the terms of this letter against you under the Contracts (Rights of Third Parties) Act 1999.

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 49 -	  	 

	4.	Please note that, by providing to you Information, the Company and each other member of the Group makes no representation or warranty to you or any other recipient of the
Information as to the accuracy or completeness of the Information or to the accuracy or completeness of the copies of the Information. 

  
 Please indicate your acceptance of the above by signing and returning the enclosed copy of this letter under confidential cover as soon as possible. 
  
  

	
	 Yours faithfully,

	
	 Station Director

	 for and on behalf of

	Eggborough Power Limited
	
	  

	[Authorised Signatory]
	 for and on behalf of

	Eggborough Power (Holdings) Limited
	
	 Accepted and agreed:

	
	  

	 for and on behalf of [·]

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 50 -	  	 

					
	EXECUTED by the parties:	  	 	    	 
			
	 Signed by
	  	)	    	 
	 a duly authorised representative of/
	  	)	    	 
	 for and on behalf of
	  	)	    	 
	EGGBOROUGH POWER	  	)	    	ROBERT ARMOUR
	(HOLDINGS) LIMITED	  	)	    	 
			
	 Signed by
	  	)	    	 
	 a duly authorised representative of/
	  	)	    	 
	 for and on behalf of
	  	)	    	SIMON DEAVES
	BARCLAYS BANK PLC	  	)	    	 
			
	 Signed by
	  	)	    	 
	 a duly authorised representative of/
	  	)	    	 
	 for and on behalf of
	  	)	    	ROBERT ARMOUR
	EGGBOROUGH POWER LIMITED	  	)	    	 
			
	 Signed by
	  	)	    	 
	 a duly authorised representative of/
	  	)	    	 
	 for and on behalf of
	  	)	    	 
	BRITISH ENERGY POWER AND	  	)	    	ROBERT ARMOUR
	ENERGY TRADING LIMITED	  	)	    	 

  

					
	
	  	 	  	 
	 ****  indicates material omitted and filed
            separately with the Commission
	  	- 51 -Debenture between Eggborough and Barclays dated September 8,2000

 Exhibit 4.32 
  
 CONFORMED COPY 
  
 DEBENTURE 
  
 DATED 30 SEPTEMBER, 2004 
  
 Between 
  
 EGGBOROUGH
POWER LIMITED 
  
 BRITISH ENERGY POWER AND ENERGY TRADING
LIMITED 
  
 EGGBOROUGH POWER (HOLDINGS) LIMITED

  
 and 
  
 BARCLAYS BANK PLC 
 as Security Trustee 
  
 THIS DEBENTURE IS ENTERED INTO 
 SUBJECT TO AND WITH THE BENEFIT OF 
 THE TERMS OF AN INTERCREDITOR DEED 
 ORIGINALLY DATED 8TH
SEPTEMBER, 2000 
 AS AMENDED BY AN 
 AMENDMENT AND RESTATEMENT DEED DATED 30 SEPTEMBER, 2004 
  
 

 
  
 ALLEN & OVERY LLP

  
 LONDON 

 CONTENTS 
  

					
	Clause

	  	Page

	1.	  	Interpretation	  	3
	2.	  	Fixed Security	  	6
	3.	  	Floating Charge	  	9
	4.	  	Covenants for Title	  	11
	5.	  	Representations and Warranties	  	11
	6.	  	General Undertakings	  	12
	7.	  	Property Undertakings	  	13
	8.	  	Security Accounts	  	15
	9.	  	Relevant Agreements	  	16
	10.	  	CTA Bonds	  	16
	11.	  	When Security becomes Enforceable	  	17
	12.	  	Enforcement of Security	  	17
	13.	  	Receiver	  	18
	14.	  	Powers of Receiver	  	19
	15.	  	Application of Proceeds	  	22
	16.	  	Delegation	  	22
	17.	  	Further Assurances	  	22
	18.	  	Power of Attorney	  	23
	19.	  	Miscellaneous	  	23
	20.	  	Release	  	24
	21.	  	Governing Law	  	25
		
	Schedule

	  	 
	1.	  	Real Property	  	26
	2.	  	Relevant Agreements	  	27
	 	  	 Form of Letters to the Account Bank
	  	28
	 	  	 Form of Notice to the Account Bank
	  	28
	 	  	 Form of Acknowledgement of the Account Bank
	  	30
	 	  	 Form of Letter from the Security Trustee to the Account Bank
	  	32
	3.	  	Forms of Notice of Assignment	  	34
	 	  	 Form of Notice of Assignment to Insurer(s)
	  	34
	 	  	 Form of Acknowledgement from Insurer
	  	36
	 	  	 Form of Notice of Assignment in Respect of Relevant Agreements
	  	37
	 	  	 Form of Acknowledgement of [Relevant Party]
	  	39
	4.	  	Forms of Letters to the Principal Paying Agent	  	40
	 	  	 Form of Notice to Principal Paying Agent
	  	40
	 	  	 Form of Acknowledgement of Principal Paying Agent
	  	41
	 	  	 Signatories
	  	42

 THIS DEBENTURE is dated 30 September, 2004 BETWEEN: 
  

	(1)	EGGBOROUGH POWER LIMITED (Registered number 03782700) (the Chargor); 

  

	(2)	BRITISH ENERGY POWER AND ENERGY TRADING LIMITED (Registered number SC200887) (BET); 

  

	(3)	EGGBOROUGH POWER (HOLDINGS) LIMITED (Registered number SC201083) (EPHL); and 

  

	(4)	BARCLAYS BANK PLC (the Security Trustee) as agent and trustee for the Finance Parties (as defined in the Credit Agreement referred to below), BET and EPHL.

  
 WHEREAS: 
  

	(A)	The Chargor enters into this Deed in connection with the Credit Agreement, the Capacity and Tolling Agreement, the Second Intercompany Loan Agreement (each as defined in the Credit
Agreement as defined below). 

  

	(B)	By deed of partial release dated on or about the date of this Deed, the Security Trustee (acting on the instructions of BE) and BE released and discharged the security created by
the Chargor under the Existing Debenture in each case for the payment, discharge and performance of the Secured Subordinated Liabilities (as defined in the Existing Debenture). 

  

	(C)	It is intended that this Deed takes effect as a deed notwithstanding the fact that a party may only execute this Deed under hand. 

  
 IT IS AGREED as follows: 
  

	1.	INTERPRETATION 

  

	1.1	Definitions 

  
 In this Deed: 
  
 Act means the Law of Property Act 1925. 
  
 Certificate of Title means any certificate of title in relation to the Mortgaged Property provided by Clifford Chance LLP to the Security Trustee.

  
 Credit Agreement means the credit agreement originally
dated 13th July, 2000, as amended and restated on 8th September, 2000, 24th October, 2000, 12th December, 2000, 5th February, 2001 and on or about the date of this Deed, between, among others, the Chargor and the Security Trustee and under which a
loan of £150,000,000 is made available to the Chargor. 
  
 CTA Bond Account has the meaning given to it in the Accounts Agreement. 
  
 CTA Bonds Transfer Form means a transfer form in respect of all the CTA Bonds (executed in blank by or on behalf of the Chargor) in
substantially the same form as the transfer attached to the CTA Global Bond Certificate. 
  

 3 

 CTA Payment Liabilities means all present and future obligations and liabilities (whether actual
or contingent and whether owed jointly or severally or in any other capacity whatsoever) of the Chargor to BET under the Capacity and Tolling Agreement together with all costs charges and expenses incurred in connection with the protection,
preservation or enforcement of its rights under the Capacity and Tolling Agreement except for any obligation which, if it were so included, would result in this Deed constituting unlawful financial assistance under Sections 151 and 152 of the
Companies Act 1985. 
  
 Discharge Date has the meaning
given to it in the Intercreditor Deed. 
  
 Fixtures means
all fixtures and fittings (including trade fixtures and fittings) and fixed plant and machinery on the Mortgaged Property. 
  
 Intellectual Property Rights means all know-how, patents, trade marks, service marks, designs, business names, topographical or similar rights,
copyrights and other intellectual property monopoly rights and any interests (including by way of licence) in any of them (in each case whether registered or not and including all applications for the same). 
  
 Liabilities means the Senior Liabilities, the CTA Payment Liabilities
and the Subordinated Liabilities. 
  
 Mortgaged Property
means all freehold or leasehold property the subject of any security created by this Deed. 
  
 Premises means all buildings and erections included in the definition of Security Assets. 
  
 Principal Paying Agent has the meaning given to it in the Conditions.

  
 Project Account has the meaning given to it in the
Accounts Agreement. 
  
 Receiver means an administrative
receiver, a receiver and manager or a receiver, in each case, appointed under this Deed. 
  
 Related Rights means any dividend or interest paid or payable in relation to any Share and any rights, moneys or property accruing or offered at any time in relation to any Shares by way of redemption,
substitution, exchange, bonus or preference, under option rights or otherwise. 
  
 Relevant Agreements means the agreements listed in Schedule 2. 
  
 Saint Gobain UK Parent Guarantee means the guarantee dated 23rd October, 1998 granted by Saint-Gobain UK Limited in favour of the Chargor in
respect of Saint-Gobain’s obligations under the Saint-Gobain Connection Agreement. 
  
 Second Security Assignment means the security assignment between the Chargor as assignor and EPHL as assignee. 
  
 Secured Parties means the Finance Parties, BET and EPHL. 
  

Security Account has the meaning given to it in Clause 8 (Security Accounts). 
  
 Security Assets means all assets of the Chargor, the subject of any security created by this Deed. It includes the
proceeds of sale of any Security Asset. 
  

 4 

 Security Period means the period beginning on the date of this Deed and ending on the date on
which the Security Trustee is satisfied that all the Liabilities have been unconditionally and irrevocably paid and discharged in full. 
  
 Senior Liabilities means all present and future obligations and liabilities (whether actual or contingent and whether owed jointly or severally or
in any other capacity whatsoever) of either Obligor to any Finance Party under each Finance Document together with all costs, charges and expenses incurred by any Finance Party in connection with the protection, preservation or enforcement of its
respective rights under the Finance Documents or any other document securing any such liability except for any obligation (including, without limitation, any obligation of EPHL under the Share Option Agreement) which, if it were so included, would
result in this Deed constituting unlawful financial assistance under Sections 151 and 152 of the Companies Act 1985. 
  
 Shares means any stocks, shares, debentures, bonds, warrants, coupons or other securities and investments (other than any deferred shares issued by
the Issuer to the Chargor in accordance with the terms of the Share Subscription Agreement) owned (either now or in the future) by the Chargor from time to time. 
  
 Subordinated Liabilities means all present and future obligations and liabilities (whether actual or contingent and
whether owed jointly or severally or in any other capacity whatsoever) of the Chargor to EPHL under the Second Intercompany Loan Agreement together with all costs charges and expenses incurred in connection with the protection, preservation or
enforcement of its rights under the Second Intercompany Loan Agreement or any other document securing any such liability except for any obligation which, if it were so included, would result in this Deed constituting unlawful financial assistance
under Sections 151 and 152 of the Companies Act 1985. 
  

	1.2	Construction 

  

	 	(a)	Capitalised terms defined in the Credit Agreement or the Accounts Agreement have, unless expressly defined in this Deed, the same meaning in this Deed. 

  

	 	(b)	The provisions of Clause 1.2 (Construction) of the Credit Agreement apply to this Deed as though they were set out in full in this Deed except that references to the Credit
Agreement are to be construed as references to this Deed. 

  

	 	(c)	The terms of the other Finance Documents, the Capacity and Tolling Agreement, the Second Intercompany Loan and of any side letters between any Parties in relation to any Finance
Document are incorporated in this Deed to the extent required to ensure that any purported disposition of the Mortgaged Property contained in this Deed is a valid disposition in accordance with Section 2(1) of the Law of Property (Miscellaneous
Provisions) Act 1989. 

  

	 	(d)	If the Security Trustee considers that an amount paid by any Obligor to a Finance Party, BET or EPHL under a Finance Document, the Capacity and Tolling Agreement or the Second
Intercompany Loan (as the case may be) is capable of being avoided or otherwise set aside on the liquidation or administration of that Obligor or otherwise, then that amount shall not be considered to have been irrevocably paid for the purposes of
this Deed. 

  

	 	(e)	For the avoidance of doubt, this Deed (or a provision of it) shall not constitute unlawful financial assistance for the purposes of the proviso to the definition of Senior
Liabilities, CTA Payment Liabilities and Subordinated Liabilities in Clause 1.1 to the extent that it constitutes financial assistance within the meaning of the Sections cited in it but the 

  

 5 

	 	    	provisions of Section 155-158 of the Companies Act 1985 have been complied with in respect of the giving of such financial assistance. 

  

	 	(f)	A person who is not a party to this Deed may not enforce its terms under the Contracts (Rights of Third Parties) Act 1999. 

  

	 	(g)	This Deed is subject to the terms and conditions of the Intercreditor Deed and the security constituted by this Deed is, in each case, subject to the security constituted by the
Existing Debenture. 

  

	 	(h)	This Deed is subject to the terms and conditions of the Share Subscription Agreement and the rights and obligations of EPL, EPHL, the Security Trustee and/or any Receiver under this
Deed are subject to the rights and obligations of EPL, EPHL, the Security Trustee and/or any Receiver under the Share Subscription Agreement. 

  

	 	(i)	Nothing in this Deed will in any way affect or prejudice the provisions of the Existing Debenture, which shall (subject to the release referred to in Recital (B)) continue in full
force and effect. It is intended that the rights of the Security Trustee, the Finance Parties and BET under this Deed shall, so far as it relates to them, be in addition to their rights under the Existing Debenture. 

  

	 	(j)	The provisions of this Deed shall only become effective upon the occurrence of the Restatement Date. 

  

	1.3	Certificates 

  
 A certificate of the Security Trustee setting forth the amount of any Secured Liability due from the Chargor shall be conclusive evidence of such amount
against the Chargor in the absence of manifest error. 
  

	2.	FIXED SECURITY 

  

	2.1	Creation of first fixed security 

  
 The Chargor, as security for the payment of all the Liabilities, charges in favour of the Security Trustee for the benefit of the Secured Parties:

  

	 	(a)	by way of a first legal mortgage: 

  

	 	(i)	all the property specified in Schedule 1; and 

  

	 	(ii)	all estates or interests in any freehold or leasehold property (except any Security Assets specified in subparagraph (i)) now belonging to it; and 

  

	 	(b)	by way of first fixed charge: 

  

	 	(i)	(to the extent that they are not the subject of a mortgage under paragraph (a)) all present and future estates or interests in any freehold or leasehold property belonging to it;

  

	 	(ii)	all plant and machinery now or in the future owned by the Chargor and its interest in any plant or machinery in its possession; 

  

 6 

	 	(iii)	its interest now or in the future in all the Shares and their Related Rights; 

  

	 	(iv)	all moneys standing to the credit of any account (including the Project Accounts but excluding the Revenue Account and the Asset Option Account) and, to the extent the Chargor has
any interest in any credit balance on the Security Accounts with any person and the debts represented by them and all Authorised Investments made from the Project Accounts, Investment Proceeds and Income (all as defined in the Accounts Agreement)
arising in respect of such Authorised Investments and all rights to receive the same; 

  

	 	(v)	to the extent not effectively assigned under Clause 2.3(a), all benefits in respect of the Insurances and all claims and returns of premiums in respect of them;

  

	 	(vi)	all of its rights, title and interest in and to the CTA Bonds; 

  

	 	(vii)	all of the Chargor’s present and future book and other debts, the proceeds of the same and all other moneys due and owing to the Chargor and the benefit of all claims, rights,
securities, receivables and guarantees of any nature enjoyed or held by it in relation to any of them; 

  

	 	(viii)	(to the extent that they do not fall within any other subparagraph of this paragraph (b) and are not effectively assigned under Clause 2.3(a)) all of the Chargor’s rights and
benefits under the Relevant Agreements, any distributorship or similar agreements entered into by it now, or in the future (including, for the avoidance of doubt, any new agreement which the Chargor may enter into pursuant to the Balancing and
Settlement Code) any letters of credit issued in its favour and all bills of exchange and other negotiable instruments held by it; 

  

	 	(ix)	any beneficial interest, claim or entitlement of the Chargor in any pension fund; 

  

	 	(x)	its present and future goodwill; 

  

	 	(xi)	the benefit of all present and future licences, permissions, consents and authorisations (statutory or otherwise) held in connection with its business or the use of any Security
Asset specified in any other subparagraph in this Clause and the right to recover and receive all compensation which may be payable to it in respect of them; 

  

	 	(xii)	its present and future uncalled capital; and 

  

	 	(xiii)	its present and future Intellectual Property Rights. 

  

	2.2	Charge over Revenue Account and Asset Option Account 

  

	 	(a)	Creation of first fixed security – Revenue Account and Asset Option Account 

  

	 	    	The Chargor: 

  

	 	(i)	as security for the payment of all CTA Payment Liabilities, charges, by way of first fixed charge, in favour of the Security Trustee for the benefit of BET, all moneys standing to
the credit of the Revenue Account and the debts 

  

 7 

	 	    	represented by them, together with all Authorised Investments made from the Revenue Account, all Investment Proceeds and Income arising in respect of such Authorised Investments and
all rights to receive the same; and 

  

	 	(ii)	as security for the payment of all Subordinated Liabilities, charges, by way of first fixed charge, in favour of the Security Trustee for the benefit of EPHL, all moneys standing to
the credit of the Asset Option Account and the debts represented by them. 

  

	 	(b)	Creation of second fixed security – Revenue Account 

  

	 	    	The Chargor as security for the payment of the Senior Liabilities, charges, by way of second fixed charge, in favour of the Security Trustee for the benefit of the Finance Parties,
all moneys standing to the credit of the Revenue Account and the debts represented by them, together with all Authorised Investments made from the Revenue Account, all Investment Proceeds and Income arising in respect of such Authorised Investments
and all rights to receive the same. 

  

	2.3	Assignments 

  

	 	(a)	The Chargor as continuing security for the payment, discharge and performance of the Liabilities, assigns and agrees to assign to the Security Trustee (as agent and trustee) (i) all
its right, title and interest (if any) in and to each Relevant Agreement and (ii) all of its present and future rights under and in respect of the Insurances. 

  

	 	(b)	The Chargor, shall promptly give notice of each such assignment of its right, title and interest (if any): 

  

	 	(i)	under and in respect of the Insurances and in the Insurance Proceeds by sending a notice in the form of Part 1 of Schedule 4 (with such amendments as the parties may agree) duly
completed to each insurer of the Insurances; and 

  

	 	(ii)	in and to the Relevant Agreements by sending a notice substantially in the form of Part 3 of Schedule 4 (with such amendments as the parties may agree) to each of the other parties
to it or if any successor or replacement agreement is entered into after the date of this Deed, promptly after such successor or replacement agreement is entered into, 

  

	 	    	and the Chargor shall use its reasonable endeavours to procure that within 14 days of the date hereof (or, in the case of paragraphs (i) and (ii), if later, the date of entry into
such Insurances or Relevant Agreements), each such other party delivers a letter of undertaking to the Security Trustee in the form of Part 2 of Schedule 4 (in the case of Insurances) or in the form of Part 4 of Schedule 4 (in the case of Relevant
Agreements), in each case with such amendments as the Security Trustee may agree. 

  

	 	(c)	To the extent that any such right, title and interest described in paragraphs (a) of this Clause 2.3 is not assignable or capable of assignment, the assignment purported to be
effected shall operate as: 

  

	 	(i)	in the case of the Insurances, an assignment of any and all proceeds of the Insurances received by each Chargor; and 

  

 8 

	 	(ii)	in the case of the Relevant Agreements, an assignment of any and all damages, compensation, remuneration, profit, rent or income which any Chargor may derive from or be awarded or
entitled to in respect of such Relevant Agreements, 

  

	 	    	in each case as continuing security for the payment, discharge and performance of the Liabilities. 

  

	2.4	Miscellaneous 

  

	 	(a)	A reference in this Deed to a charge or mortgage of any freehold or leasehold property includes: 

  

	 	(i)	all buildings and Fixtures on that property; 

  

	 	(ii)	the proceeds of sale of any part of that property; and 

  

	 	(iii)	the benefit of any covenants for title given or entered into by any predecessor in title of the Chargor in respect of that property or any moneys paid or payable in respect of those
covenants. 

  

	 	(b)	The fact that no details of properties or agreements are included in the relevant Schedule does not affect the validity or enforceability of any security created by this Deed.

  

	 	(c)	Without prejudice to Clause 2.1(b)(vii) (Creation of first fixed security), Clause 2.2(a) (Creation of first fixed security – Revenue Account and Asset Option Account) and
Clause 2.2(b) (Creation of second fixed security – Revenue Account) if, pursuant to Clause 8.3 (Withdrawals), or the terms of the Accounts Agreement, the Chargor is entitled to withdraw the proceeds of any book and other debts standing to the
credit of a Security Account and, as a result, those proceeds are in any way released from the fixed charges created pursuant to Clause 2.1(b)(vii) (Creation of first fixed security), Clause 2.2(a) (Creation of first fixed security – Revenue
Account and Asset Option Account) and Clause 2.2(b) (Creation of second fixed security – Revenue Account) and stand subject to the floating charges created pursuant to Clause 3.1 (Creation of first floating charge), Clause 3.2 (Creation of
first floating charge - Revenue Account), Clause 3.3 (Creation of first floating charge – Asset Option Account) and Clause 3.4 (Creation of second floating charge - Revenue Account and Asset Option Account), the release will in no way derogate
from the subsistence and continuance of the fixed charges on all other outstanding book and other debts of the Chargor and the proceeds of those debts. 

  

	3.	FLOATING CHARGE 

  

	3.1	Creation of first floating charge 

  
 The Chargor, as security for the payment of all of the Liabilities, charges in favour of the Security Trustee for the benefit of the Secured Parties by
way of a first floating charge all its assets (excluding the Revenue Account and the Asset Option Account and the debts represented by them, together with all Authorised Investments made from the Revenue Account, all Investment Proceeds and Income
arising in respect of such Authorised Investments and all rights to receive the same) not otherwise effectively mortgaged or charged by way of the first fixed mortgage or charge by Clause 2.1 (Creation of first fixed security). 
  

 9 

	3.2	Creation of first floating charge - Revenue Account 

  
 The Chargor as security for the payment of all CTA Payment Liabilities, charges, by way of first floating charge, in favour of the Security Trustee for
the benefit of BET, all moneys standing to the credit of the Revenue Account and the debts represented by them, together with all Authorised Investments made from the Revenue Account, all Investment Proceeds and Income arising in respect of such
Authorised Investments and all rights to receive the same not otherwise effectively mortgaged or charged by way of the first fixed mortgage or charge by Clause 2.2(a) (Creation of first fixed security – Revenue Account and Asset Option
Account). 
  

	3.3	Creation of first floating charge – Asset Option Account 

  
 The Chargor as security for the payment of all Subordinated Liabilities, charges, by way of first floating charge, in favour of the Security Trustee for
the benefit of EPHL, all moneys standing to the credit of the Asset Option Account and the debts represented by them, and all rights to receive the same not otherwise effectively mortgaged or charged by way of the first fixed mortgage or charge by
Clause 2.2(a) (Creation of first fixed security – Revenue Account and Asset Option Account). 
  

	3.4	Creation of second floating charge - Revenue Account and Asset Option Account 

  
 The Chargor as security for the payment of all of the Senior Liabilities, charges, by way of second floating charge, in
favour of the Security Trustee for the benefit of the Finance Parties, all the moneys standing to the credit of each of the Revenue Account and the Asset Option Account and the debts represented by them, together with all Authorised Investments made
from the Revenue Account, all Investment Proceeds and Income arising in respect of such Authorised Investments and all rights to receive the same not otherwise effectively mortgaged or charged by way of the second fixed mortgage or charge by Clause
2.2(a) (Creation of second fixed security – Revenue Account). 
  

	3.5	Conversion 

  

	 	(a)	The Security Trustee may, by notice to the Chargor, in accordance with the other Finance Documents, convert each floating charge created by this Deed into a fixed charge as regards
all or any of the Chargor’s assets specified in the notice if: 

  

	 	(i)	an Event of Default has occurred and is continuing and provided that no Option has been exercised (unless an Option has been exercised and the relevant Obligor has failed to
transfer the shares in, or assets of, the Chargor in default of its obligations under that Option); or 

  

	 	(ii)	the Security Trustee reasonably considers those assets to be in danger of being seized or sold under any form of distress, attachment, execution or other legal process.

  

	 	(b)	Each floating charge shall, in accordance with the other Finance Documents (in addition to the circumstances in which the same will occur under general law) automatically be
converted into a fixed charge over the assets, rights and property of the Chargor in the convening of any meeting of the members of the Chargor to consider a resolution to wind the Chargor up (or not to wind the Chargor up).

  

 10 

	 	(c)	Each floating charge will automatically convert into a fixed charge over all of the Chargor’s assets if an administrator is appointed or the Security Trustee receives notice of
an intention to appoint an administrator. 

  

	 	(d)	No floating charge may be converted into a fixed charge solely by reason of: 

  

	 	(i)	the obtaining of a moratorium; or 

  

	 	(ii)	anything done with a view to obtaining a moratorium, 

  

	 	    	under the Insolvency Act 2000. 

  

	 	(e)	Each floating charge granted in favour of the Security Trustee for the Finance Parties is a qualifying floating charge for the purpose of paragraph 13 of Schedule B1 to the
Insolvency Act 1986. 

  

	4.	COVENANTS FOR TITLE 

  
 Each mortgage, charge and assignment created under this Deed is made by the Chargor with full title guarantee in accordance with the Law of Property
(Miscellaneous Provisions) Act 1994. 
  

	5.	REPRESENTATIONS AND WARRANTIES 

  

	5.1	Representations and Warranties 

  
 The Chargor makes the representations and warranties set out in this Clause 5 to each Finance Party. 
  

	5.2	Intellectual Property Rights 

  

	 	(a)	The Intellectual Property Rights owned by the Chargor are all of the Intellectual Property Rights required by it in order for it to carry on its business as it is now being
conducted and the Chargor does not, in carrying on its business, infringe any Intellectual Property Rights of any third party. 

  

	 	(b)	The Intellectual Property Rights owned by the Chargor are free of any Security Interests (save for any permitted Security Interests) and any other rights or interests (including any
licences) in favour of third parties. 

  

	 	(c)	To its knowledge, no Intellectual Property Right owned by the Chargor is being infringed, nor is there any threatened infringement of any Intellectual Property Right.

  

	5.3	CTA Bonds 

  
 The Chargor is the legal and beneficial owner of the CTA Bonds free from any Security Interest (save for any Permitted Security Interest created under the
Security Documents or in favour of the Account Bank). 
  

	5.4	Times for making representations and warranties 

  
 The representations and warranties set out in this Clause 5 are made on the date of this Deed. 
  

 11 

	6.	GENERAL UNDERTAKINGS 

  

	6.1	Duration 

  
 The undertakings in this Clause 6 remain in force throughout the Security Period. 
  

	6.2	Book debts and receipts 

  
 The Chargor shall: 
  

	 	(a)	get in and realise the Chargor’s: 

  

	 	(i)	securities to the extent held by way of temporary investment; 

  

	 	(ii)	book and other debts and other moneys; and 

  

	 	(iii)	royalties, fees and income of like nature in relation to any Intellectual Property Right owned by it, 

  
 in the ordinary course of its business and hold the proceeds of the getting in and realisation until payment into a Project
Account, the Revenue Account or the Asset Option Account in accordance with the Accounts Agreement or, while an Event of Default is continuing, into a Security Account in accordance with (b) upon trust for the Security Trustee; and 
  

	 	(b)	save to the extent that the Security Trustee otherwise agrees, or to the extent paid into the Project Accounts, the Revenue Account or the Asset Option Account in accordance with
the Accounts Agreement, while an Event of Default is continuing, pay the proceeds of getting in and realisation into a Security Account. 

  

	6.3	Deposit of Shares 

  
 The Chargor shall: 
  

	 	(a)	deposit with the Security Trustee, or as the Security Trustee may direct, all certificates and other documents of title or evidence of ownership in relation to the Shares and their
Related Rights; and 

  

	 	(b)	execute and deliver to the Security Trustee all share transfers and other documents which may be requested by the Security Trustee in order to enable the Security Trustee or its
nominees to be registered as the owner or otherwise obtain a legal title to the Shares and their Related Rights. 

  

	6.4	Deposit of CTA Bonds 

  
 The Chargor shall deposit with the Security Trustee, or as the Security Trustee may direct, the CTA Global Bond Certificate together with a CTA Bonds
Transfer Form. 
  

	6.5	Intellectual Property Rights 

  
 The Chargor shall: 
  

	 	(a)	make such registrations and pay such fees, registration taxes and similar amounts as are necessary to keep its Intellectual Property Rights in force; 

  

 12 

	 	(b)	if requested to do so by the Security Trustee, make entries in any public register of its Intellectual Property Rights which either record the existence of this Deed or the
restrictions on disposal effected by this Deed; 

  

	 	(c)	take such steps as are necessary (including the institution of legal proceedings) to prevent third parties infringing those Intellectual Property Rights and (without prejudice to
paragraph (a)) take all other steps which are reasonably practicable to maintain and preserve its interests in them; and 

  

	 	(d)	not, without the prior consent of the Security Trustee: 

  

	 	(i)	sell, transfer, license or otherwise dispose of all or any part of those Intellectual Property Rights; or 

  

	 	(ii)	permit any Intellectual Property Right which is registered to be abandoned or cancelled, to lapse or to be liable to any claim of abandonment for non-use or otherwise.

  

	7.	PROPERTY UNDERTAKINGS 

  

	7.1	Duration 

  
 The undertakings in this Clause 7 remain in force throughout the Security Period. 
  

	7.2	Repair 

  
 The Chargor shall keep: 
  

	 	(a)	the Premises in good and substantial repair and condition; and 

  

	 	(b)	the Fixtures and all plant, machinery, implements and other effects owned by it and which are in or upon the Premises or elsewhere in a good state of repair and in good working
order and condition. 

  

	7.3	Insurance 

  
 The Chargor shall insure the Premises and all its other assets of an insurable nature in the Premises to the extent required under the Credit Agreement.

  

	7.4	Compliance with leases 

  
 The Chargor shall: 
  

	 	(a)	perform all material terms on its part contained in any lease or leases comprised within the Mortgaged Property; and 

  

	 	(b)	not do (to the extent reasonably possible) permit to be done any act as a result of which any such lease or leases would be reasonably likely to become liable to forfeiture or
otherwise be determined. 

  

 13 

	7.5	Acquisitions and legal mortgage 

  

	 	(a)	The Chargor shall: 

  

	 	(i)	notify the Security Trustee promptly upon the acquisition by the Chargor of any freehold or leasehold property; and 

  

	 	(ii)	on demand made to the Chargor by the Security Trustee and at the cost of the Chargor, execute and deliver to the Security Trustee a legal mortgage in favour of the Security Trustee
of any freehold or leasehold property which becomes vested in it after the date of this Deed in any form which the Security Trustee may reasonably require. 

  

	 	(b)	In the case of any leasehold property in relation to which the consent of the landlord in whom the reversion of that lease is vested is required in order for the Chargor to perform
any of its obligation under subparagraph (a)(ii), the Chargor shall not be required to perform that obligation unless and until it has obtained the landlord’s consent (which it shall use its reasonable endeavours to obtain).

  

	7.6	Notices 

  
 The Chargor shall, within 14 days after the receipt by the Chargor of any application, requirement, order or notice served or given by any public or local
or any other authority with respect to the Security Assets (or any part of them): 
  

	 	(a)	give notice to the Security Trustee within seven days after receipt of such application, requirement, order or notice; 

  

	 	(b)	deliver a copy to the Security Trustee; and 

  

	 	(c)	inform the Security Trustee of the steps taken or proposed to be taken to comply with the relevant requirement. 

  

	7.7	Leases 

  
 The Chargor shall not, without the prior consent of the Security Trustee, grant or agree to grant (whether in exercise or independently of any statutory
power) any lease or tenancy of the Mortgaged Property or any part of it or accept a surrender of any lease or tenancy or (except where necessary for the operation and maintenance of the Plant) confer upon any person any contractual licence or right
to occupy the Mortgaged Property. 
  

	7.8	H.M. Land Registry 

  
 The Chargor shall in respect of any freehold or leasehold property which is acquired after the date of this Deed by the Chargor, the title to which is
registered at H.M. Land Registry or the title to which is required to be so registered, give H.M. Land Registry written notice of this Deed and procure that notice of this Deed is duly noted in the Register to each such title. 
  

	7.9	Deposit of title deeds 

  
 The Chargor shall deposit with the Security Trustee all deeds and documents of title relating to the Mortgaged Property and all Local Land Charges, Land
Charges and Land Registry Search Certificates and similar documents received by or on behalf of the Chargor. The Security Trustee is entitled to hold the above deeds and documents during the Security Period. 
  

 14 

	7.10	Power to remedy 

  
 In case of default by the Chargor in performing any material term affecting the Mortgaged Property and the Chargor failing to remedy such default upon
request by the Security Trustee so to do within the time period stated by the Security Trustee, the Chargor shall permit the Security Trustee or its agents and contractors: 
  

	 	(a)	to enter on the Mortgaged Property; 

  

	 	(b)	to comply with or object to any notice served on the Chargor in respect of the Mortgaged Property; and 

  

	 	(c)	to take any action as the Security Trustee may reasonably consider necessary or desirable to prevent or remedy any breach of any such term or to comply with or object to any such
notice. 

  

	8.	SECURITY ACCOUNTS 

  

	8.1	Accounts 

  

	 	(a)	The Security Trustee may open a an account (the Security Account) at any time after an Event of Default has occurred and is continuing and the Chargor shall do all such acts
and things as the Security Trustee may request in connection with opening the same. 

  

	 	(b)	All Security Accounts must be maintained at a branch of the Account Bank. 

  

	8.2	Interest 

  
 The Security Accounts shall bear interest at the rate reasonably determined by the Security Trustee. 
  

	8.3	Withdrawals 

  

	 	(a)	Except with the prior consent of the Security Trustee, the Chargor shall not withdraw any moneys standing to the credit of a Security Account. 

  

	 	(b)	The Security Trustee (or a Receiver) may (subject to the payment of any claims having priority to this security) withdraw amounts standing to the credit of a Security Account to
meet an amount due and payable under the Intercreditor Deed when it is due and payable. 

  

	8.4	Notice 

  

	 	(a)	The Chargor shall promptly give notice to the Account Bank (and promptly on any change in the identity of the Account Bank, give notice to the new Account Bank) of this Deed in the
form of Schedule 3Part 1 and use reasonable endeavours to procure, to the extent that such notice is not acknowledged in the Account Agreement or in any agreement replacing such Accounts Agreement, that the Account Bank acknowledges such notice in
accordance with Schedule 3Part 2. 

  

 15 

	 	(b)	As soon as reasonably practicable after receipt by it of such acknowledgement, the Security Trustee will deliver a letter substantially in the form set out in Schedule 3Part 3. The
Security Trustee: 

  

	 	(i)	may only withdraw the consents in such letter (to the extent they apply to the Project Accounts and the Revenue Account) while an Event of Default is continuing; and

  

	 	(ii)	shall not withdraw the consents in such letter to the extent they apply to the Asset Option Account. 

  

	 	(c)	For the avoidance of doubt, the notice under paragraph (a) above will include notice to the Account Bank (or new Account Bank as the case may be) in respect of the security granted
in favour of EPHL over the Asset Option Account and BET over the Revenue Account. 

  

	9.	RELEVANT AGREEMENTS 

  
 Prior to the occurrence of an Event of Default, which is continuing: 
  

	 	(a)	the Security Trustee shall permit the Chargor to exercise the rights of the Chargor under any Relevant Agreement (including the right to receive money); and

  

	 	(b)	the Chargor shall be entitled to instruct the counterparties to the Relevant Agreements to make payments due under any of them directly: 

  

	 	(i)	into a Project Account in accordance with the terms of the Accounts Agreement; or 

  

	 	(ii)	to BET in accordance with the terms of the Capacity and Tolling Agreement. 

  

	 	(c)	any payments received by the Security Trustee under or in respect of such Relevant Agreements by virtue of this Deed shall be paid by the Security Trustee to the Revenue Account in
accordance with the terms of the Accounts Agreement save to the extent required by the terms of the Intercreditor Agreement to be applied against any of the Liabilities or otherwise. 

  

	10.	CTA BONDS 

  

	10.1	CTA Bonds 

  
 From the date of this Deed, the Security Trustee may exercise (in the name of the Chargor or otherwise and without any further consent or authority on the
part of the Chargor) any and all rights and powers of the Chargor under the CTA Bonds, provided that all payments received by the Security Trustee or the Chargor under or in respect of the CTA Bonds shall be paid by the Security Trustee or the
Chargor, as the case may be, into the CTA Bond Account in accordance with the terms of the Accounts Agreement, save to the extent otherwise required by the terms of the Intercreditor Agreement. 
  

	10.2	Notice 

  
 The Chargor shall promptly give notice to the Principal Paying Agent (and promptly on any change in the identity of the Principal Paying Agent, give
notice to the new Principal Paying Agent) of this Deed in the form of Schedule 5 Part 1 and use reasonable endeavours to procure that the Principal Paying Agent acknowledges such notice in accordance with Schedule 5 Part 2. 
  

 16 

	11.	WHEN SECURITY BECOMES ENFORCEABLE 

  
 The security constituted by this Deed shall become immediately enforceable upon the occurrence and continuance of an Event of Default and the power of
sale and other powers conferred by Section 101 of the Act, as varied or amended by this Deed, shall be immediately exercisable upon and at any time after the occurrence and continuance of any Event of Default. After the security constituted by this
Deed has become enforceable, the Security Trustee may in its absolute discretion enforce all or any part of the security in any manner it sees fit or as the Majority Banks direct. 
  

	12.	ENFORCEMENT OF SECURITY 

  

	12.1	General 

  
 For the purposes of all statutory powers of sale under Sections 101 and 103 of the Act (restricting the power of sale), the Liabilities are deemed to have
become due and payable on the date of this Deed and Section 103 of the Act (restricting the power of sale) and Section 93 of the Act (restricting the right of consolidation) do not apply to the security constituted by this Deed. The statutory powers
of leasing conferred on the Security Trustee are extended so as to authorise the Security Trustee to lease, make agreements for leases, accept surrenders of leases and grant options as the Security Trustee may think fit and without the need to
comply with any provision of section 99 or 100 of the Act. 
  

	12.2	Shares 

  
 After the security constituted by this Deed has become enforceable, the Security Trustee may exercise (in the name of the Chargor and without any further
consent or authority on the part of the Chargor) any voting rights and any powers or rights which may be exercised by the person or persons in whose name any Share and its Related Rights are registered or who is the holder of any of them or
otherwise (including all the powers given to trustees by Section 10(3) and (4) of the Trustee Act, 1925 as amended by Section 9 of the Trustee Investment Act, 1961 in respect of securities or property subject to a trust). Until that time, the voting
rights, powers and other rights in respect of the Shares shall (if exercisable by the Security Trustee) be exercised in any manner which the Chargor may direct in writing. 
  

	12.3	Contingencies 

  
 If the Security Trustee enforces the security constituted by this Deed at a time when no amounts are due under the Finance Documents, the Capacity and
Tolling Agreement or the Second Intercompany Loan but at a time when amounts may or will become so due, the Security Trustee (or the Receiver) may pay the proceeds of any recoveries effected by it into a Security Account. 
  

	12.4	No liability as mortgagee in possession 

  
 Neither the Security Trustee nor any Receiver will be liable, by reason of entering into possession of a Security Asset, to account as mortgagee in
possession or for any loss on realisation or for any default or omission for which a mortgagee in possession might be liable. 
  

 17 

	12.5	Agent of the Chargor 

  
 Each Receiver is deemed to be the agent of the Chargor for all purposes and accordingly is deemed to be in the same position as a Receiver duly appointed
by a mortgagee under the Act. The Chargor alone shall be responsible for his contracts, engagements, acts, omissions, defaults and losses and for liabilities incurred by him and the Finance Parties, BET and EPHL shall not incur any liability (either
to the Chargor or to any other person) by reason of the Security Trustee making his appointment as a Receiver or for any other reason. 
  

	12.6	Privileges 

  
 Each Receiver and the Security Trustee is entitled to all the rights, powers, privileges and immunities conferred by the Act on mortgagees and receivers
when such receivers have been duly appointed under the Act, except that Section 103 of the Act does not apply. 
  

	12.7	Protection of third parties 

  
 No person (including a purchaser) dealing with the Security Trustee or a Receiver or its or his agents will be concerned to enquire: 
  

	 	(a)	whether the Liabilities have become payable; 

  

	 	(b)	whether any power which the Security Trustee or the Receiver is purporting to exercise has become exercisable; 

  

	 	(c)	whether any money remains due under the Finance Documents, the Capacity and Tolling Agreement or the Second Intercompany Loan Agreement; or 

  

	 	(d)	how any money paid to the Security Trustee or to the Receiver is to be applied. 

  

	12.8	Redemption of prior Mortgages 

  
 At any time after the security constituted by this Deed has become enforceable, the Security Trustee may do one or more of the following: 
  

	 	(a)	redeem any prior Security Interest against any Security Asset (other than any Security Interest created under the Second Security Assignment); 

  

	 	(b)	procure the transfer of that Security Interest to itself (other than any Security Interest created under the Second Security Assignment); or 

  

	 	(c)	settle and pass the accounts of the prior mortgagee, chargee or encumbrancer (other than the accounts of EPHL); any accounts so settled and passed shall be conclusive and binding on
the Chargor. 

  
 All principal moneys, interest,
costs, charges and expenses of and incidental to any such redemption or transfer shall be paid by the Chargor to the Security Trustee on demand. 
  

	13.	RECEIVER 

  

	13.1	Appointment of Receiver 

  

	 	(a)	Except as provided below, at any time after the security constituted by this Deed becomes enforceable or, if the Chargor so requests the Security Trustee in writing, at any time,
the Security Trustee may without further notice appoint by deed, under seal or in writing under its hand any one or more persons to be a Receiver of all or any part of the Security Assets, 

  

 18 

	 	    	provided that the Security Trustee may not appoint an administrative receiver (as defined in Section 29(2) of the Insolvency Act 1986) over the Security Assets if the Security
Trustee is prohibited from so doing by section 72A of the Insolvency Act 1986 and no exception to the prohibition on appointing an administrative receiver applies. 

  

	 	(b)	Section 109(1) of the Act shall not apply to this Deed and the Security Trustee may fix the remuneration of any Receiver appointed by it. 

  

	 	(c)	The Security Trustee is not entitled to appoint a Receiver solely as a result of the obtaining of a moratorium (or anything done with a view to obtaining a moratorium) under the
Insolvency Act 2000 except with the leave of the court. 

  

	13.2	Removal 

  
 The Security Trustee may by writing under its hand (subject to any requirement for an order of the court in the case of an administrative receiver) remove
any Receiver appointed by it and may, whenever it deems it expedient, appoint a new Receiver in the place of any Receiver whose appointment may for any reason have terminated. 
  

	13.3	Remuneration 

  
 The Security Trustee may fix the remuneration of any Receiver appointed by it and the maximum rate specified in Section 109(b) of the Act shall not apply.

  

	13.4	Relationship with Security Trustee 

  
 To the fullest extent permitted by law, any right, power or discretion conferred by this Deed (either expressly or impliedly) upon a Receiver of the
Security Assets may after the security created by this Deed becomes enforceable be exercised by the Security Trustee in relation to any Security Asset without first appointing a Receiver or notwithstanding the appointment of a Receiver. 

 

	14.	POWERS OF RECEIVER 

  

	14.1	General 

  

	 	(a)	Each Receiver has, and is entitled to exercise, all of the rights, powers and discretions set out below in this Clause 13 in addition to those conferred on it by any law; this
includes: 

  

	 	(i)	in the case of an administrative receiver, all the rights, powers and discretions conferred on an administrative receiver under the Insolvency Act 1986; or 

 

	 	(ii)	otherwise, all the rights, powers and discretions conferred on a receiver (or a receiver and manager) under the Act and the Insolvency Act 1986. 

  

	 	(b)	If there is more than one Receiver holding office at the same time, each Receiver may (unless the document appointing him states otherwise) exercise all of the powers conferred on a
Receiver under this Deed individually and to the exclusion of any other Receivers. 

  

 19 

	14.2	Possession 

  
 A Receiver may take immediate possession of, get in and collect any Security Assets. 
  

	14.3	Carry on business 

  
 A Receiver may carry on the business of the Chargor as he thinks fit. 
  

	14.4	Protection of assets 

  
 A Receiver may: 
  

	 	(a)	make and effect all repairs and insurances and do all other acts which the Chargor might do in the ordinary conduct of its business as well for the protection as for the improvement
of the Security Assets; 

  

	 	(b)	commence or complete any building operations on the Mortgaged Property; and 

  

	 	(c)	apply for and maintain any planning permission, building regulation approval or any other permission, consent or licence, 

  
 in each case as he may think fit. 
  

	14.5	Employees 

  
 A Receiver may appoint and discharge managers, officers, agents, accountants, servants, workmen and others for the purposes of this Deed upon such terms
as to remuneration or otherwise as he may think proper and discharge any such persons appointed by the Chargor. 
  

	14.6	Borrow money 

  
 A Receiver may raise and borrow money either unsecured or on the security of any Security Asset either in priority to the security constituted by this
Deed or otherwise and generally on any terms and for whatever purpose which he thinks fit. No person lending that money is concerned to enquire as to the propriety or purpose of the exercise of that power or to check the application of any money so
raised or borrowed. 
  

	14.7	Sale of assets 

  
 A Receiver may sell, exchange, convert into money and realise any Security Asset by public auction or private contract and generally in any manner and on
any terms which he thinks proper. The consideration for any such transaction may consist of cash, debentures or other obligations, shares, stock or other valuable consideration and any such consideration may be payable in a lump sum or by
instalments spread over such period as he thinks fit. Fixtures, other than landlords fixtures, may be severed and sold separately from the property containing them without the consent of the Chargor. 
  

	14.8	Leases 

  
 A Receiver may let any Security Asset for any term and at any rent (with or without a premium) which he thinks proper and may accept a surrender of any
lease or tenancy of any Security Asset on any terms which he thinks fit (including the payment of money to a lessee or tenant on a surrender). 
  

 20 

	14.9	Compromise 

  
 A Receiver may settle, adjust, refer to arbitration, compromise and arrange any claims, accounts, disputes, questions and demands with or by any person
who is or claims to be a creditor of the Chargor or relating in any way to any Security Asset. 
  

	14.10	Legal Actions 

  
 A Receiver may bring, prosecute, enforce, defend and abandon all actions, suits and proceedings in relation to any Security Asset which may seem to him to
be expedient. 
  

	14.11	Receipts 

  
 A Receiver may give valid receipts for all moneys and execute all assurances and things which may be proper or desirable for realising any Security Asset.

  

	14.12	Subsidiaries 

  
 A Receiver may form a Subsidiary of the Chargor and transfer to that Subsidiary any Security Asset. 
  

	14.13	Delegation 

  
 A Receiver may delegate his powers in accordance with Clause 16 (Delegation). 
  

	14.14	Other powers 

  
 A Receiver may: 
  

	 	(a)	do all other acts and things which he may consider desirable or necessary for realising any Security Asset or incidental or conducive to any of the rights, powers or discretions
conferred on a Receiver under or by virtue of this Deed; and 

  

	 	(b)	exercise in relation to any Security Asset all the powers, authorities and things which he would be capable of exercising if he were the absolute beneficial owner of the it,

  
 and may use the name of the Chargor for any of
the above purposes. 
  

	14.15	Limitation on sale of CTA Bonds 

  

	 	(a)	Notwithstanding: 

  

	 	(i)	any power of sale conferred on the Security Trustee or any Receiver by law or under this Deed; or 

  

	 	(ii)	any other provision of this Deed, 

  
 neither the Security Trustee nor any Receiver shall sell or otherwise dispose, or enforce all or any of its rights hereunder (including under Clause
17.2) against, all or any of the CTA Bonds prior to the Determination Date. 
  

	 	(b)	On and from the Determination Date, the Security Trustee and any Receiver shall not sell or otherwise dispose of the CTA Bonds otherwise than in accordance with the Share
Subscription Agreement. 

  

 21 

	15.	APPLICATION OF PROCEEDS 

  

	15.1	Application of Proceeds 

  
 Any moneys received by the Security Trustee or any Receiver after an Enforcement Event shall be applied in the order of priority set out in the
Intercreditor Deed (but without prejudice to the right of any Finance Party, BET or EPHL to recover any shortfall from the Chargor) 
  

	15.2	Good Discharge 

  
 An acknowledgement of receipt signed by the relevant person to whom payments are to be made under Clause 14 shall be a good discharge of the Security
Trustee. 
  

	16.	DELEGATION 

  
 The Security Trustee and any Receiver may delegate by power of attorney or in any other manner to any person any right, power or discretion exercisable by
them under this Deed. Any such delegation may be made upon the terms (including power to sub-delegate) and subject to any regulations which the Security Trustee or such Receiver (as the case may be) may think fit. Neither the Security Trustee nor
any Receiver will be in any way liable or responsible to the Chargor for any loss or liability arising from any act, default, omission or misconduct on the part of any such delegate or sub-delegate unless caused by the gross negligence or wilful
default of the Security Trustee or, as the case may be, the Receiver. 
  

	17.	FURTHER ASSURANCES 

  

	17.1	General 

  
 Subject always to Clause 14.15, the Chargor shall, at its own expense, take whatever action the Security Trustee or a Receiver may reasonably require for
any of the following: 
  

	 	(a)	perfecting or protecting the security intended to be created by this Deed over any Security Asset; 

  

	 	(b)	facilitating the realisation of any Security Asset or the exercise of any right, power or discretion exercisable, by the Security Trustee or any Receiver or any of its or their
delegates or sub-delegates in respect of any Security Asset, after such time as the Security Interest constituted by this Deed shall have become enforceable; or 

  

	 	(c)	subject to the terms of this Deed, exercising any and all rights, powers or discretions which may be exercised by the Chargor under the CTA Bonds, 

  
 including the execution of any transfer, conveyance, assignment or assurance
of any property whether to the Security Trustee or to its nominees, and the giving of any notice, order or direction and the making of any registration, which in any such case, the Security Trustee may think expedient. 
  

	17.2	Legal Charge 

  
 Subject always to Clause 14.15, without prejudice to the generality of Clause 17.1, the Chargor will promptly at the request of the Security Trustee
(acting reasonably) execute a legal mortgage, charge or assignment over all or any of the Security Assets subject to or intended to be subject to any fixed security created in favour of the Security Trustee (as agent and trustee as) in such form as
the Security Trustee may require. 
  

 22 

	18.	POWER OF ATTORNEY 

  
 The Chargor, by way of security, irrevocably and severally appoints the Security Trustee, each Receiver and any of their delegates or sub-delegates to be
its attorney to, at any time while an Event of Default has occurred and is continuing, take any action which the Chargor is obliged to take under this Deed, including under Clause 17 (Further Assurances). The Chargor ratifies and confirms whatever
any attorney does or purports to do pursuant to its appointment under this Clause. 
  

	19.	MISCELLANEOUS 

  

	19.1	Covenant to pay 

  
 The Chargor shall pay or discharge the Senior Liabilities, the CTA Payment Liabilities and the Subordinated Liabilities in the manner provided for in the
Finance Documents, the Capacity and Tolling Agreement and the Second Intercompany Loan Agreement. 
  

	19.2	Continuing security 

  
 The security constituted by this Deed is continuing and will extend to the ultimate balance of all the Senior Liabilities, the CTA Payment Liabilities and
Subordinated Liabilities, regardless of any intermediate payment or discharge in whole or in part. 
  

	19.3	Additional security 

  

	 	(a)	The security constituted by this Deed is in addition to and is not in any way prejudiced by any other security now or subsequently held by any Finance Party for any Senior
Liabilities, BET for any CTA Payment Liabilities or EPHL for any Subordinated Liabilities. 

  

	 	(b)	No Power and nothing in this Deed or any collateral security merges in, or in any other way prejudicially affects or is prejudicially affected by: 

  

	 	(i)	any other Security Interest; or 

  

	 	(ii)	any judgment, right or remedy against any person, 

  
 which any Finance Party, BET or EPHL or any person claiming on behalf of, or through, any Finance Party, BET or EPHL may have at any time. 
  
 Power means a power, right, authority, discretion or remedy which is
conferred on the Security Trustee or a Receiver or an attorney: 
  

	 	(a)	by this Deed or any collateral security; or 

  

	 	(b)	by law in relation to this Deed or any collateral security. 

  

	19.4	Tacking 

  

	 	(a)	Each Bank shall perform its obligations under the Credit Agreement (including any obligation to make available further advances). 

  

 23 

	 	(b)	BET shall perform its obligations under the Capacity and Tolling Agreement (including any obligation to make available further advances). 

  

	 	(c)	EPHL shall perform its obligations under the Second Intercompany Loan Agreement (including any obligation to make available further advances). 

  

	19.5	New Accounts 

  
 If a Finance Party, BET or EPHL receives, or is deemed to be affected by, notice, whether actual or constructive, of any subsequent charge or other
interest affecting any Security Asset, the Finance Party, BET or EPHL, as the case may be, may open a new account with the Chargor. If the Finance Party BET or EPHL, as the case may be, does not open a new account, it shall nevertheless be treated
as if it had done so at the time when it received or was deemed to have received notice. As from that time all payments made to the Finance Party, BET or EPHL, as the case may be, will be credited or be treated as having been credited to the new
account and will not operate to reduce any amount for which this Deed is security. 
  

	19.6	Time deposits 

  
 Without prejudice to any right of set-off any Finance Party may have under any other Finance Document or otherwise, if any time deposit matures on any
account the Chargor has with any Finance Party at a time within the Security Period when: 
  

	 	(a)	this security has become enforceable; and 

  

	 	(b)	no amount of the Liabilities is due and payable, 

  
 that time deposit shall automatically be renewed for any further maturity which that Finance Party considers appropriate. 
  

	19.7	Notice of assignment 

  
 This Deed constitutes notice in writing to the Chargor of any charge or assignment of a debt owed by the Chargor to any other member of the Group
contained in any other Security Document. 
  

	19.8	H.M. Land Registry 

  
 The Chargor applies to the Chief Land Registrar for a restriction in the following terms to be entered on the Register of Title relating to any Mortgaged
Property registered at H.M. Land Registry and against which this Deed may be noted: 
  
 “Except under an order of the Registrar, no disposition or dealing by the proprietor of the land is to registered without the consent of the proprietor for the time being of the Debenture dated September, 2004
between Eggborough Power Limited, Eggborough Power (Holdings) Limited, British Energy Power and Energy Trading Limited and Barclays Bank PLC”. 
  

	20.	RELEASE 

  

	 	(a)	Upon the expiry of the Security Period (but not otherwise), the Finance Parties, BET or EPHL, as the case may be, shall, at the request and cost of the Chargor, take whatever action
is necessary to release the Security Assets from the security constituted by this Deed. 

  

 24 

	 	(b)	Subject to the terms of the Intercreditor Agreement and to subparagraph (a) above, the Security Trustee shall not release the security constituted by this Deed in favour of EPHL and
BET without the prior written consent of EPHL and BET. 

  

	21.	GOVERNING LAW 

  
 This Deed is governed by English law. 
  
 THIS DEED has been entered into as a deed on the date stated at the beginning of this Deed. 
  

 25 

 SCHEDULE 1 
  

REAL PROPERTY 
  
 The freehold land and buildings known as Eggborough Power Station, Eggborough, Goole, North Yorkshire, comprised in a transfer dated 20th February, 2000 made between (1)
National Power Plc and (2) the Chargor (then known as Boron Limited), the title to which is in course of registration at H M Land Registry with Title Number NYK 233369. 
  
 The freehold land comprising Gale Common, North Yorkshire, comprised in a transfer dated 3rd March, 2000 made between (1) National Power Plc
and (2) the Chargor (then known as Boron Limited), the title to which is in course of registration at H M Land Registry with Title Numbers NYK 234230 and NYK 67029. 
  

 26 

 SCHEDULE 2 
  

RELEVANT AGREEMENTS 

	1.	the Capacity and Tolling Agreement; 

  

	2.	the Bilateral Connection and Use of System Agreement dated 13 March 2003 between the Chargor and the National Grid Company plc; 

  

	3.	the licence dated 10th August, 2000 to use and ash pipeline at Whitby granted to the Obligor by British Waterways Board; 

  

	4.	the private railways sidings agreement novated to the Chargor by Railtrack plc and National Power by a novation contract dated 10th February, 2000; 

  

	5.	the lease dated 27th May, 2002 of an easement to use two water pipes below the railway at Knottingly between Railtrack plc and the Chargor; 

  

	6.	the Station Contracts; 

  

	7.	the agreement dated 15th November, 1999 between National Power Plc and the Chargor for the sale of the business relating to the Eggborough Power Station by National Power Plc to the
Chargor; and 

  

	8.	the Saint Gobain UK Parent Guarantee, 

  
 (in each case including any supplements, amendments or replacements). 
  

 27 

 SCHEDULE 3 
  

FORM OF LETTERS TO THE ACCOUNT BANK 
  
 PART 1 
  
 FORM OF NOTICE TO THE ACCOUNT BANK 
  
 [On the letterhead of the Chargor] 
  

	To:	[Account Bank] 

  
 [DATE] 
  
 Dear Sirs, 
  
 Debenture (Debenture) dated          September,
2004 between Eggborough Power Limited, Eggborough Power (Holdings) Limited British Energy Power and Energy Trading Limited and Barclays Bank PLC 
  
 This letter constitutes notice to you that, by the Debenture (a copy of which is attached), we have charged: 
  

	(a)	to Barclays Bank PLC (the Security Trustee) for the benefit of the Secured Parties, all moneys standing to the credit of any account maintained by us with you (other than the
Revenue Account and the Asset Option Account) and the debts represented by them; 

  

	(b)	to the Security Trustee for the benefit of BET and (by way of second fixed charge) to the Security Trustee for the benefit of the Finance Parties all moneys standing to the credit
of the Revenue Account; and 

  

	(c)	to the Security Trustee for the benefit of EPHL, all moneys standing to the credit of the Asset Option Account, 

  
 (together, the Accounts). 
  
 We irrevocably instruct and authorise you to: 
  

	1.	(a) disclose to the Security Trustee on request to you by the Security Trustee any information relating to any Account maintained with you; and 

  

	 	(b)	comply with the terms of any written notice or instructions relating to the Debenture or moneys standing to the credit of any Accounts maintained with you and the debts represented
by them, received by you from the Security Trustee, 

  
 without any reference to or further authority from us and without any enquiry by you as to the justification for the disclosure or, as the case may be, validity of the notice or instructions; 
  

	2.	hold all sums from time to time standing to the credit of any Account maintained with you to the order of the Security Trustee; and 

  

	3.	pay or release all or any part of the moneys standing to the credit of the Accounts maintained with you in accordance with the written instructions of the Security Trustee.

  

 28 

 We are not permitted to withdraw any amount from any of the Accounts maintained with you without the prior written
consent of the Security Trustee. 
  
 The instructions in this letter may not be
revoked or amended without the prior written consent of the Security Trustee. 
  
 This letter is governed by English law. 
  
 Please confirm your agreement
to the above by sending the attached acknowledgement to the Security Trustee with a copy to ourselves. 
  

	
	Yours faithfully,
	
	

	(Authorised Signatory)
	Eggborough Power Limited

  

 29 

 PART 2 
  
 FORM OF ACKNOWLEDGEMENT OF THE ACCOUNT BANK 
  
 [On the letterhead of the Account Bank] 
  

	To:	Barclays Bank PLC as Security Trustee for the Finance Parties (as defined in the Debenture), Eggborough Power (Holdings) Limited and British Energy Power and Energy Trading Limited

  
 [DATE] 
  
 Dear Sirs, 
  
 Debenture (Debenture) dated [        ] between Eggborough Power Limited, Eggborough Power
(Holdings) Limited, British Energy Power and Energy Trading Limited and Barclays Bank PLC 
  
 We confirm receipt from Eggborough Power Limited (the Company) of a notice dated [            ] of certain charges upon the terms of the Debenture
over all moneys standing to the credit of any of the Company’s accounts with us (including the Revenue Account and the Asset Option Account) (the Accounts) and the debts represented by them. 
  
 We confirm that we: 
  

	1.	accept the instructions contained in the notice and undertake to comply with the notice; 

  

	2.	have not received notice of the interest of any third party in any of the Accounts maintained with us (save for those created by or pursuant to a Debenture dated 8th September, 2000 made by the Chargor in favour of, amongst others, the Security Trustee) and a security assignment dated on or
about the date of the Debenture given by the Chargor in favour of Eggborough Power (Holdings) Limited; 

  

	3.	have neither claimed or exercised nor will claim or exercise any security interest, set-off, counter-claim or other right in respect of any of the Accounts maintained with us, the
moneys in those Accounts or the debts represented by them; and 

  

	4.	shall not permit any amount to be withdrawn from any of the Accounts maintained with us without your prior written consent. 

  
 The Accounts maintained with us are: 
  
 [Specify accounts and account numbers] 
  
 This letter is governed by English law. 
  

	
	Yours faithfully,
	
	

	(Authorised signatory)

  

 30 

 [Account Bank] 
  

 31 

 PART 3 
  
 FORM OF LETTER FROM THE SECURITY TRUSTEE TO THE ACCOUNT BANK 
  
 [On the letterhead of the Security Trustee] 
  

	To:	[Account Bank] 

  
 [DATE] 
  
 Dear Sirs, 
  
 We refer to: 
  

	1.	the Debenture dated [            ] (the Debenture) between Eggborough Power Limited (the Company), Eggborough
Power (Holdings) Limited, British Energy Power and Energy Trading Limited and Barclays Bank PLC; and 

  

	2.	the notice to you dated [            ] from the Company concerning the accounts of the Company with you (the
Accounts); and 

  

	3.	the acknowledgement dated [            ] issued by you to
[                 ] in response to the notice. 

  
 We confirm that we consent to the following transactions in relation to the Accounts: 
  

	 	(a)	you may collect and pay to the credit of any Account, the proceeds of credits for the account of the Chargor; 

  

	 	(b)	you may make payments to third parties or to other Accounts in the name of the Chargor on the instructions of the Chargor and debit the amounts involved to any Account;

  

	 	(c)	you may debit to any Account (other than the Asset Option Account) amounts due to you (in your capacity as Account Bank) by the Chargor; and 

  

	 	(d)	in order to enable you to make available net overdraft facilities on the Accounts only, you may set-off debit balances on any of the Accounts (other than the CTA Bond Account and
the Asset Option Account) against credit balances on any of the Accounts (other than the CTA Bond Account and the Asset Option Account); 

  

	 	(e)	you may make such withdrawals and transfers on behalf of the Chargor as permitted by the Accounts Agreement. 

  
 The consents in this letter will remain in effect until you receive notice from us
withdrawing any or all of them. In this event they shall be withdrawn to the extent stated in the notice. 
  
 This letter is governed by English law. 
  
 Please
acknowledge receipt of this letter by signing and returning to us the enclosed copy of this letter. 
  

 32 

	
	Yours faithfully,
	
	

	(Authorised signatory)
	Barclays Bank PLC
	
	Receipt acknowledged
	
	

	(Authorised signatory)
	[Account Bank]

  

 33 

 SCHEDULE 4 
  

FORMS OF NOTICE OF ASSIGNMENT 
  
 Part 1 
  
 FORM OF NOTICE OF ASSIGNMENT TO INSURER(S) 
  
 [Note: A separate notice of assignment must be sent to, and acknowledged by, each Insurer where there is more than one.] 
  

	To:	[Name and address of Insurer] [Date:                  ,    ]

  
 Dear Sirs, 
  
 Notice of Assignment and Instructions Re: Insurance Policy
[                        ] (the Insurance) 
  
 Eggborough Power Limited (the Assignor) HEREBY GIVES NOTICE (this Notice) that by a debenture (the Debenture)
originally dated [            ], 2004, between Eggborough Power Limited, Eggborough Power (Holdings) Limited, British Energy Power and Energy Trading Limited and Barclays Bank PLC as
security trustee (the Security Trustee), a copy of which is attached hereto, the Assignor has assigned by way of security to the Security Trustee all of the Assignor’s present and future rights under and in respect of the Assigned
Insurances and its present and future rights, title and interest in the Insurance Proceeds (but not, for the avoidance of doubt, in the contracts comprising the Assigned Insurances themselves) (the Assigned Property). The assignments under
the Debenture extend to (but are not limited to) the Assignor’s rights under the above policy issued by you. 
  
 Capitalised terms shall bear the same meaning in this Notice as in the Debenture. 
  

Please note that: 
  

	1.	only the Security Trustee may agree to waive any right vested in the Assignor under the Insurance; 

  

	2.	the terms and conditions of the Insurance may not be amended in any manner without the prior agreement of the Security Trustee; 

  

	3.	you are authorised to disclose to the Security Trustee on request any information relating to the Assigned Property or any claim under it to which the Assignor is entitled as an
insured party; 

  

	4.	the Security Trustee (or any person appointed by the Security Trustee as its agent or delegate) has been irrevocably appointed by the Assignor as its attorney to do all things which
the Assignor could do in relation to the Assigned Insurances upon the occurrence and continuance of an Event of Default, and you are requested to follow any instruction properly given to you by such attorney at such time. In the event of a conflict
in your instructions, those given by the Security Trustee (or any other attorney appointed by us under the Debenture) shall prevail; 

  

 34 

	5.	any notice given by you under or in respect of the Insurance should be sent to the Security Trustee at the address given below (or to such other address as the Security Trustee may
notify to you from time to time) with a copy to the Assignor; 

  

	6.	the Security Trustee has assumed no obligation to you under or in respect of the Insurance and the Assignor continues to be responsible to you for the performance of its obligations
under the Insurance; and 

  

	7.	these instructions may not be varied, except with the written consent of the Security Trustee. 

  
 Please acknowledge receipt of this Notice and the Debenture by (i) countersigning and returning to the Security Trustee a copy of this
Notice and sending a duplicate of your acknowledgement to us at [Address], (ii) endorsing a copy of this notice of assignment on the above referred to policy issued by you, and (iii) confirming that you have not received notice of any other
assignment of any interest in the Insurances (save for those received pursuant to a Debenture dated 8th September,
2000 made by the Chargor in favour of, amongst others, the Security Trustee). 
  
 This Notice is governed by English law. 
  

	
	
	

	Eggborough Power Limited
	
	c.c. Barclays Bank PLC

  

 35 

 PART 2 
  
 FORM OF ACKNOWLEDGEMENT FROM INSURER 
  

	To:	Barclays Bank PLC as Security Trustee for the Finance Parties (as defined in the Debenture dated [ ], 2004 (the Debenture) granted to it by the company named as chargor in
the Debenture), Eggborough Power (Holdings) Limited and British Energy Power and Trading Limited. 

  
 Dear Sirs, 
  
 Re: Insurance Policy No: [            ] (the Policy) and notice of assignment dated
[            ] (the Notice) 
  
 We acknowledge receipt of the attached Notice and, insofar as may be required, we consent to the assignment to which the Notice refers. We agree to follow the instructions to us contained in that notice and confirm
that we have endorsed a copy of the Notice on the Policy. 
  
 We confirm that (i)
the policy to which this notice refers is in full force and effect, (ii) that we are not aware of breach by the Assignor of the Policy or of any duty owed to us in relation to it, (iii) that we have not received any other notice of assignment
relating to the Policy (save for those received pursuant to Debenture dated 8th September, 2000 made by the Chargor
in favour of, amongst others, the Security Trustee) and (iv) we will make payments due under or in respect of the Policy as provided in it. 
  

			
	
	 	 
	 For and on behalf of [the Insurer]
	 	Date:             , [2004]

  

 36 

 PART 3 
  
 FORM OF NOTICE OF ASSIGNMENT IN RESPECT OF RELEVANT AGREEMENTS 
  

	To:	[Relevant party] 

  
 [Date] 
  
 Dear Sirs,

  
 We notify you that, by a [first priority] Debenture dated
[            ], 2004 (the Debenture), made by, Eggborough Power Limited (the Chargor) in favour of Eggborough Power (Holdings) Limited (EPHL), British Energy Power and
Energy Trading Limited (BET) and Barclays Bank PLC as agent and trustee for the Finance Parties referred to in the Debenture, BET and EPHL (the Security Trustee) there has been assigned by the Chargor to the Security Trustee [as
first and subsequent priority mortgagee and assignee] all the Chargor’s rights, title and interest in and to [insert details of Relevant Agreement] (the Agreement), and to the extent (if any) not effectively so assigned, there has
been granted to the Security Trustee (as agent and trustee) charges over all of the Chargor’s rights and benefits under the Agreement. 
  
 On behalf of the Chargor, we irrevocably instruct and authorise you: 
  

	1.	to disclose to the Security Trustee with a copy to the Chargor and without any further authority from the Chargor and without any enquiry by you as to the justification for such
disclosure, such information relating to the Agreement as the Security Trustee may at any time and from time to time reasonably request; and 

  

	2.	to comply with the terms of any written notice or instructions in any way relating to, or purporting to relate to, the Debenture, the sums payable to the Chargor from time to time
under the Agreement or the debts concerning them which you receive at any time from the Security Trustee without any reference to or further authority from the Chargor and without any enquiry by you as to the justification for or validity of such
notice or instruction. 

  
 Notwithstanding the assignment referred
to above or the making of any payment by you to the Security Trustee pursuant to it, the Chargor shall remain liable under the Agreement to perform all the obligations assumed by it under the Agreement and neither the Security Trustee nor any
receiver nor any delegate appointed by it shall be at any time under any obligation or liability to you under or in respect of the Agreement. 
  
 Please also acknowledge receipt of this letter and confirm that you will comply with the other provisions of this letter by signing the acknowledgement attached to this
Notice of Assignment and returning the duplicate copy to [insert name and address of Security Trustee], giving to the Security Trustee for the Finance Parties, BET and EPHL the further undertakings set out in it. 
  
 Please note that these instructions are not to be revoked or amended without the prior
written consent of the Security Trustee. 
  
 This letter shall be governed by and
construed in accordance with English law. 
  

 37 

	
	Yours faithfully,
	
	

	For and on behalf of
	Eggborough Power Limited Enc.
	
	c.c. Barclays Bank PLC

  

 38 

 PART 4 
  
 FORM OF ACKNOWLEDGEMENT OF [RELEVANT PARTY] 
  

	To:	Barclays Bank PLC as Security Trustee for the Finance Parties (as defined in the Debenture dated [        ], 2004 granted to it by the
Chargor (the Debenture)), Eggborough Power Holdings) Limited and and British Energy Power and Trading Limited. 

  
 Dear Sirs, 
  
 We confirm receipt from Eggborough Power Limited (the Chargor) of a notice dated [                ] (the Notice) of a
charge or assignment upon the terms of the Debenture over all of the Chargor’s rights, title and interest in and to [insert details of Relevant Agreement] (the Agreement). 
  
 We confirm that: 
  

	1.	we accept the instructions and authorisations contained in the Notice and we undertake to act in accordance with and comply with the terms of the Notice; 

 

	2.	we have not received notice of the interest of any third party in or to the Agreement (save for those received pursuant to a Debenture dated 8th September, 2000 made by the Chargor in favour of, amongst others, the Security Trustee); and 

  

	3.	we shall not permit any sums to be paid to the Chargor or any other persons under or pursuant to the Agreement without your prior written consent save in accordance with the Notice,
and in particular with paragraph (b) of the Notice. 

  
 This letter
shall be governed by and construed in accordance with English law. 
  

	
	Yours faithfully,
	
	

	On behalf of
	[Relevant party]
	
	c.c. [Eggborough Power Limited]

  

 39 

 SCHEDULE 5 
  

FORMS OF LETTERS TO THE PRINCIPAL PAYING AGENT 
  
 PART 1 
  
 FORM OF NOTICE TO PRINCIPAL PAYING AGENT 
  
 [On the letterhead of the Chargor] 
  
 To:    [Principal Paying Agent] 
  
 [DATE] 
  
 Dear Sirs, 
  
 Debenture (Debenture) dated
[            ] between Eggborough Power Limited, Eggborough Power (Holdings) Limited British Energy Power and Energy Trading Limited and Barclays Bank PLC 
  
 This letter constitutes notice to you that, by the Debenture (a copy of which is attached),
we have charged to Barclays Bank PLC (the Security Trustee) for the benefit of the Secured Parties, by way of first fixed charge, all of our rights, title and interest in and to the CTA Bonds. 
  
 We irrevocably instruct and authorise you to: 
  

	 	(a)	pay all moneys due to us in relation to the CTA Bonds into the following account: 

  
 [Specify details of CTA Bond Account] 
  
 (the CTA Bond Account); 
  

	 	(b)	disclose to the Security Trustee on request to you by the Security Trustee any information relating to the CTA Bonds; and 

  

	 	(c)	comply with the terms of any written notice or instructions relating to the Debenture or the CTA Bonds, received by you from the Security Trustee, 

  
 without any reference to or further authority from us and without any
enquiry by you as to the justification for the disclosure or, as the case may be, validity of the notice or instructions. 
  
 The instructions in this letter may not be revoked or amended without the prior written consent of the Security Trustee. 
  
 This letter is governed by English law. 
  
 Please confirm your agreement to the above by sending the attached acknowledgement to the
Security Trustee with a copy to ourselves. 
  
 Yours faithfully, 
  

 (Authorised Signatory)

 Eggborough Power Limited 
  

 40 

 PART 2 
  
 FORM OF ACKNOWLEDGEMENT OF THE PRINCIPAL PAYING AGENT 
  
 [On the letterhead of the Account Bank] 
  

	To:	Barclays Bank PLC as Security Trustee for the Finance Parties (as defined in the Debenture), Eggborough Power (Holdings) Limited and British Energy Power and Energy Trading Limited

  
 [DATE] 
  
 Dear Sirs, 
  
 Debenture (Debenture) dated [            ] between Eggborough Power Limited,
Eggborough Power (Holdings) Limited, British Energy Power and Energy Trading Limited and Barclays Bank PLC 
  
 We confirm receipt from Eggborough Power Limited (the Company) of a notice dated [            ] of
certain charges upon the terms of the Debenture over the CTA Bonds. 
  
 We confirm
that we accept the instructions contained in the notice and undertake to comply with the notice. 
  
 This letter is governed by English law. 
  
 Yours
faithfully, 
  

 (Authorised signatory) 
 [Principal Paying Agent] 
  

 41 

 SIGNATORIES 
  

			
	 Chargor
	 	 
		
	 EXECUTED as a DEED by
	 	             )

	 EGGBOROUGH POWER LIMITED
	 	             )

	 acting by
	 	             )

	 and
	 	             )

		
	 Director
	 	 Neil O’Hara

		
	 Director/Secretary
	 	 Robert Armour

		
	 BET
	 	 
		
	EXECUTED as a DEED by	 	             )

	 BRITISH ENERGY POWER AND
	 	             )

	 ENERGY TRADING LIMITED
	 	             )

	 acting by
	 	             )

	 and
	 	             )

		
	 Director
	 	 Neil O’Hara

		
	 Director/Secretary
	 	 Robert Armour

		
	 EPHL
	 	 
		
	EXECUTED as a DEED by	 	             )

	 EGGBOROUGH POWER
	 	             )

	 (HOLDINGS) LIMITED
	 	             )

	 acting by
	 	             )

	 and
	 	             )

		
	 Director
	 	 Neil O’Hara

		
	 Director/Secretary
	 	 Robert Armour

		
	 Signed by:
	 	 Simon Deaves

		
	 BARCLAYS BANK PLC
	 	 

  

 42

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00088-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00088-of-00352.parquet"}]]