Common use of Assignment; Assumption Clause in Contracts

Assignment; Assumption. Effective as of the Effective Date, Assignor hereby sells, transfers and assigns to Assignee all of Assignor’s right, title and interest in, to and under as Purchaser under the Assigned Contract (except for the right to file a reactive power tariff at FERC and receive any reactive power revenues and/or rights associated with the Assigned Contract) to the extent arising out of the period commencing on the Effective Date through and including November 30, 2008 (the “Assignment Period”). In consideration for the Assignment Payment, Assignee expressly accepts the assignment set forth in the preceding sentence for the relevant Assignment Period and hereby assumes all of Assignor’s liabilities, obligations, taxes and contractual commitments as Purchaser under and/or pertaining to the Assigned Contracts (except for any reactive power revenues and/or rights associated with the Assigned Contract) to the extent arising out of such Assignment Period. Notwithstanding the preceding paragraph: (a) the Parties agree that any payments, Energy or other benefits (howsoever defined) or liabilities in connection with the Assigned Contract to the extent occurring during or arising out of a period of time either before or after the Assignment Period shall be for the account of, and promptly delivered to or satisfied by, as applicable, Assignor, even if such payments, Energy or other benefit are made or delivered for whatever reason during the Assignment Period; and (b) the Parties agree that any payments, Energy or other benefits (howsoever defined) or liabilities in connection with the Assigned Contract to the extent occurring during or arising out of the Assignment Period shall be for the account of, and promptly delivered to or satisfied by, as applicable, Assignee, even if such payments, Energy or other benefit are made or delivered for whatever reason during a period of time either before or after the Assignment Period; and (c) although Assignor will retain the legal right to file a reactive power tariff at FERC and receive any “reactive power revenues and/or rights” which occur during or arise out of the Assignment Period in connection with the Assigned Contract, Assignor shall request that PJM Interconnection, LLC (“PJM”) direct all reactive power revenue payments (“Reactive Power Payments”) which occur during or arise out of the Assignment Period in connection with the Assigned Contract to an account specified by Assignee (or if for any reason PJM does not make such payments directly to Assignee, Assignor shall receive such payments and then promptly transfer them to Assignee). Once the Assignment Period has expired or the Assigned Agreement has been terminated prior to the expiration thereof, following presentation to Assignor of all documentation requested by Assignor to verify the amount of Reactive Power Payments received by Assignee, Assignor shall pay to Assignee the difference between the Reactive Power Amount (as defined below) and the amount of Reactive Power Payments actually received by Assignee during the Assignment Period or during the term of the Power Purchase Agreement, dated as of the date hereof, between Assignor and Assignee (the “Back-to-Back PPA”), such deficiency amount to be termed the “Reactive Power Deficiency”. The Reactive Power Deficiency shall be payable by Assignor within ten (10) Business Days of Assignor’s receipt of Assignee’s invoice therefor. On the Effective Date, Assignor shall provide a guaranty substantially in the form set forth in Exhibit C hereto in the amount of $3,500,000 to guarantee Assignor’s payment obligation under this Section 2(c). The Reactive Power Amount shall be equal the product of (A) Three Million, Five Hundred Thousand Dollars ($3,500,000) and (B) a fraction, the numerator of which is the number of months from and including December, 2004 up to and including the month in which the Assignment Period ends or the month in which the early termination of the Assigned Agreement occurs, as applicable, and the denominator of which is forty-eight (48). Further, the Parties agree that notwithstanding the provisions of this Section, the expiration of the Assignment Period or termination of this Agreement, the Reactive Power Deficiency may be adjusted (upwards or downwards) by the amount of any adjustments made by PJM to the calculation of reactive power revenues and/or rights which occur during or arise out of the Assignment Period within twelve months after the expiry of the Assignment Period. Any amounts payable by a Party as a result of such adjustment shall be paid by the Party who owes it within ten (10) Business Days of such Party’s receipt of the other Party’s invoice therefor.

Assignment; Assumption. Effective Pursuant to authority granted in the Lease and Financing Agreement, the Assignor hereby transfers and assigns as of the Effective Date, Assignor hereby sells, transfers Date unto the Assignee and its successors and assigns to Assignee all of Assignor’s its right, title and interest inin and to, to and under all remedies under, the Assigned Documents, and, other than the Retained Liabilities (as Purchaser hereinafter defined), the Assignee hereby assumes as of the Effective Date all of the Assignor’s obligations under the Assigned Contract (except for Documents, all upon the right terms and subject to file a reactive power tariff at FERC the conditions set forth herein. All of the Assignor’s obligations hereunder and receive any reactive power revenues and/or rights associated with under the Assigned Contract) Documents are subject to the extent arising out of the period commencing on the Effective Date through any limitation, exclusions, conditions and including November 30, 2008 (the “Assignment Period”). In consideration for the Assignment Payment, Assignee expressly accepts the assignment non-recourse limitations set forth in the preceding sentence for the relevant Assignment Period and hereby assumes all of Assignor’s liabilities, obligations, taxes and contractual commitments as Purchaser under and/or pertaining to the such Assigned Contracts (except for any reactive power revenues and/or rights associated with the Assigned Contract) to the extent arising out of such Assignment PeriodDocuments. Notwithstanding the preceding paragraph: foregoing, the Assignor shall remain liable for (a) the Parties agree that any payments, Energy or other benefits (howsoever defined) or liabilities in connection with indemnification obligations under the Assigned Contract to the extent occurring during Documents, other than such indemnification obligations caused by or arising out of a period of time either before or after from the Assignment Period shall be for the account ofoperation, use, occupancy, maintenance and promptly delivered to or satisfied by, as applicable, Assignor, even if such payments, Energy or other benefit are made or delivered for whatever reason during the Assignment Period; and (b) the Parties agree that any payments, Energy or other benefits (howsoever defined) or liabilities in connection with the Assigned Contract to the extent occurring during or arising out ownership of the Assignment Period shall be for the account of, and promptly delivered to or satisfied by, as applicable, Assignee, even if such payments, Energy or other benefit are made or delivered for whatever reason during a period of time either before or after the Assignment Period; and (c) although Assignor will retain the legal right to file a reactive power tariff at FERC and receive any “reactive power revenues and/or rights” which occur during or arise out of the Assignment Period in connection with the Assigned Contract, Assignor shall request that PJM Interconnection, LLC (“PJM”) direct all reactive power revenue payments (“Reactive Power Payments”) which occur during or arise out of the Assignment Period in connection with the Assigned Contract to an account specified by Assignee (or if for any reason PJM does not make such payments directly to Assignee, Assignor shall receive such payments and then promptly transfer them to Assignee). Once the Assignment Period has expired Project or the Assigned Agreement has been terminated prior bodily or personal injury or death of any person or damage to the expiration thereof, following presentation to Assignor of all documentation requested by Assignor to verify the amount of Reactive Power Payments received by Assignee, Assignor shall pay to Assignee the difference between the Reactive Power Amount (as defined below) and the amount of Reactive Power Payments actually received by Assignee during the Assignment Period or during the term of the Power Purchase Agreement, dated as of the date hereof, between Assignor and Assignee (the “Back-to-Back PPA”), such deficiency amount to be termed the “Reactive Power Deficiency”. The Reactive Power Deficiency shall be payable by Assignor within ten (10) Business Days of Assignor’s receipt of Assignee’s invoice therefor. On property occurring after the Effective Date, (b) any obligations with respect to the acquisition, construction and installation of the Project, (c) any representation or warranty made by the Assignor shall provide a guaranty substantially under the Assigned Documents, and (d) the payment of all amounts, the performance of all duties and obligations and the satisfaction of all conditions under the Assigned Documents that accrued prior to the Effective Date or which were to be performed or satisfied prior to the Effective Date or which arise from events, actions or omissions which occurred on or before the Effective Date, including, without limitation, its obligations under any indemnities included in the form set forth in Exhibit C hereto in the amount of $3,500,000 to guarantee Assignor’s payment obligation under this Section 2(c). The Reactive Power Amount shall be equal the product of Assigned Documents (A) Three Million, Five Hundred Thousand Dollars ($3,500,000) and (B) a fractioncollectively, the numerator of which is the number of months from and including December, 2004 up to and including the month in which the Assignment Period ends or the month in which the early termination of the Assigned Agreement occurs, as applicable, and the denominator of which is forty-eight (48“Retained Liabilities”). Further, the Parties agree that notwithstanding the provisions of this Section, the expiration of the Assignment Period or termination of this Agreement, the Reactive Power Deficiency may be adjusted (upwards or downwards) by the amount of any adjustments made by PJM to the calculation of reactive power revenues and/or rights which occur during or arise out of the Assignment Period within twelve months after the expiry of the Assignment Period. Any amounts payable by a Party as a result of such adjustment shall be paid by the Party who owes it within ten (10) Business Days of such Party’s receipt of the other Party’s invoice therefor.