Common use of Conduct of Business Relating to the Auctioned Assets Clause in Contracts

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Seller will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility Practices, and continue to pay accounts payable which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent of Buyer (such consent not to be unreasonably withheld), Seller will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Person; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller with respect to the Auctioned Assets, other than consistent with past practice; (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practice; (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendments; (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,000, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viii) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viii), (B) those capital expenditures which do not exceed in the aggregate $2,000,000 (in addition to those other capital expenditures permitted under this subsection (viii)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller will not make any such mandated capital expenditures (unless the failure by Seller to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital Expenditures"); (ix) enter into any Contract with Affiliates of Seller the term of which are not indicative of arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned Assets; or (xii) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in the foregoing clauses (i) through (xi). (c) Without limiting the generality of Sections 7.1(a) and (b), to the extent Section 7.1(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 to the contrary, Seller may take any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or ), as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this AgreementAgreement or as otherwise required by law (including Environmental Laws), during the period from the date of this Agreement to the Closing Date, Seller will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility PracticesPractice, and continue to pay accounts payable payable, salaries, wages, benefits, and other amounts incurred in the operation of the Auctioned Assets which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent of Buyer (such consent not to be unreasonably withheldwithheld or delayed), Seller will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Personperson; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller with respect to the Auctioned Assets, other than consistent with past practice; (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practice; (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendments, and (D) modifications, alterations and amendments contemplated by Section 7.3(b); (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,0002 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis DE MINIMIS administrative costs); (vii) except as set forth on SCHEDULE 7.1(b)(vii), (A) establish, adopt, enter into or amend any collective bargaining agreement or Benefit Plan, except (1) if such action would not create a Material Adverse Effect or (2) as required under applicable law or under the terms of any collective bargaining agreement, or (B) grant to any employee of the Auctioned Assets any increase in compensation, except (1) in the ordinary course of business consistent with past practice or (2) to the extent required by the terms of any collective bargaining agreement, employment agreement in effect as of the date of this Agreement or applicable law; (viii) except in the case of capital expenditures covered by clause (ix) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vii) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of one million dollars ($1,000,000), not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than DE MINIMIS administrative costs); providedPROVIDED, howeverHOWEVER, that notwithstanding any other provision of this Agreement to the contrary, Seller may enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viiiix) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viiiSCHEDULE 7.1(b)(ix), (B) those capital expenditures which do not exceed in the aggregate one million dollars ($2,000,000 1,000,000) (in addition to those other capital expenditures permitted under this subsection (viiiix)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller will not make any such mandated capital expenditures (unless the failure by Seller to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital ExpendituresPERMITTED CAPITAL EXPENDITURES"); (ixx) enter into any Contract with Affiliates of Seller which would become an Assumed Obligation unless the term terms of which are not indicative of an arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned Assetsarrangement; or (xiixi) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in prohibited by the foregoing clauses (i) through (xix). (c) Without limiting the generality of Sections 7.1(a) and (b), to the extent Section 7.1(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 to the contrary, Seller may take any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Seller will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility Practicesgood industry practice and applicable legal requirements, and continue to pay accounts payable which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent of Buyer (such consent not to be unreasonably withheld), Seller will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Personperson; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller with respect to the Auctioned Assets, other than consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets (except coal handling equipment) that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may sell the VISY Option Parcel to VISY pursuant to the exercise by VISY of the option under the VISY Option Agreement; (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendmentsamendments and (D) modifications, alterations and amendments contemplated by Section 7.03(b); (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,0002 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that Seller may enter into Contracts for the storage of fuel with respect to the Auctioned Assets with a term ending not later than December 31, 2000 and otherwise on terms consistent with Seller's past practice; (vii) (A) establish, adopt, enter into or amend any Collective Bargaining Agreement or Benefits Plans, except (1) if such action would not create a Material Adverse Effect or (2) as required under applicable law or under the terms of any Collective Bargaining Agreement or (B) grant to any Affected Employee any increase in compensation, except (1) in the ordinary course of business consistent with past practice or (2) to the extent required by the terms of any Collective Bargaining Agreement, employment agreement in effect as of the date of this Agreement or applicable law; (viii) enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vii) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $2 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may (A) enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viii) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viii), Agreements and (B) those capital expenditures which do not exceed in the aggregate $2,000,000 (in addition to those other capital expenditures permitted under this subsection (viii)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller will not make any such mandated capital expenditures (unless the failure by Seller to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital Expenditures"); (ix) enter into any Contract with Affiliates and record the Declarations of Seller the term of which are not indicative of arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned AssetsSubdivision Easements; or (xiiix) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in the foregoing clauses (i) through (xiviii). (c) Without limiting the generality of Sections 7.1(a7.01(a) and (b), to the extent Section 7.1(a7.01(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 7.01 to the contrary, Seller may take any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, Obligations or (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or ), as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this AgreementAgreement or as otherwise required by law (including Environmental Laws), during the period from the date of this Agreement to the Closing Date, Seller Sellers will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility PracticesPractice, and continue to pay accounts payable payable, salaries, wages, benefits, and other amounts incurred in the operation of the Auctioned Assets which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent of Buyer (such consent not to be unreasonably withheldwithheld or delayed), Seller Sellers will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Personperson; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller Sellers with respect to the Auctioned Assets, other than consistent with past practice; (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practice; (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendments, and (D) modifications, alterations and amendments contemplated by Section 7.3(b); (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,0002 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis DE MINIMIS administrative costs); (vii) except as set forth on SCHEDULE 7.1(B)(VII), (A) establish, adopt, enter into or amend any collective bargaining agreement or Benefit Plan, except (1) if such action would not create a Material Adverse Effect or (2) as required under applicable law or under the terms of any collective bargaining agreement, or (B) grant to any employee of the Auctioned Assets any increase in compensation, except (1) in the ordinary course of business consistent with past practice or (2) to the extent required by the terms of any collective bargaining agreement, employment agreement in effect as of the date of this Agreement or applicable law; (viii) except in the case of capital expenditures covered by clause (ix) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vii) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of one million dollars ($1,000,000), not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than DE MINIMIS administrative costs); providedPROVIDED, howeverHOWEVER, that notwithstanding any other provision of this Agreement to the contrary, Seller Sellers may enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viiiix) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viiiSCHEDULE 7.1(B)(IX), (B) those capital expenditures which do not exceed in the aggregate one million dollars ($2,000,000 1,000,000) (in addition to those other capital expenditures permitted under this subsection (viiiix)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller Sellers will not make any such mandated capital expenditures (unless the failure by Seller Sellers to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller Sellers prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital ExpendituresPERMITTED CAPITAL EXPENDITURES"); (ixx) enter into any Contract with Affiliates of such Seller which would become an Assumed Obligation unless the term terms of which are not indicative of an arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned Assetsarrangement; or (xiixi) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in prohibited by the foregoing clauses (i) through (xix). (c) Without limiting the generality of Sections 7.1(a) and (b), to the extent Section 7.1(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 to the contrary, Seller may take any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Seller will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility Practicesgood industry practice and applicable legal requirements, and continue to pay accounts payable which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent of Buyer (such consent not to be unreasonably withheld), Seller will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Personperson; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller with respect to the Auctioned Assets, other than consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendmentsamendments and (D) modifications, alterations and amendments contemplated by Section 7.03(b); (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,0002 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that Seller may enter into Contracts for the storage of fuel with respect to the Auctioned Assets with a term ending not later than December 31, 2000 and otherwise on terms consistent with Seller's past practice; (vii) (A) establish, adopt, enter into or amend any Collective Bargaining Agreement or Benefits Plans, except (1) if such action would not create a Material Adverse Effect or (2) as required under applicable law or under the terms of any Collective Bargaining Agreement or (B) grant to any Affected Employee any increase in compensation, except (1) in the ordinary course of business consistent with past practice or (2) to the extent required by the terms of any Collective Bargaining Agreement, employment agreement in effect as of the date of this Agreement or applicable law; (viii) enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vii) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $2 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may (A) enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viii) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viii), Agreements and (B) those capital expenditures which do not exceed in the aggregate $2,000,000 (in addition to those other capital expenditures permitted under this subsection (viii)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller will not make any such mandated capital expenditures (unless the failure by Seller to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital Expenditures"); (ix) enter into any Contract with Affiliates and record the Declarations of Seller the term of which are not indicative of arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned AssetsSubdivision Easements; or (xiiix) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in the foregoing clauses (i) through (xiviii). (c) Without limiting the generality of Sections 7.1(a7.01(a) and (b), to the extent Section 7.1(a7.01(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 7.01 to the contrary, Seller may take any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, Obligations or (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Seller will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility Practicesgood industry practice and applicable legal requirements, and continue to pay accounts payable which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent of Buyer (such consent not to be unreasonably withheld), Seller will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Personperson; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller with respect to the Auctioned Assets, other than consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the offering Memorandum other than the Generating Plants or Gas Turbines); (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets (except coal handling equipment) that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may sell the VISY Option Parcel to VTSY pursuant to the exercise by VISY of the option under the VISY option Agreement; (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendmentsamendments and (D) modifications, alterations and amendments contemplated by Section 7.03(b); (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,0002 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that Seller may enter into Contracts for the storage of fuel with respect to the Auctioned Assets with a term ending not later than December 31, 2000 and otherwise on terms consistent with Seller's past practice; (vii) (A) establish, adopt, enter into or amend any Collective Bargaining Agreement or Benefits Plans, except (1) if such action would not create a Material Adverse Effect or (2) as required under applicable law or under the terms of any Collective Bargaining Agreement or (B) grant to any Affected Employee any increase in compensation, except (1) in the ordinary course of business consistent with past practice or (2) to the extent required by the terms of any Collective Bargaining Agreement, employment agreement in effect as of the date of this Agreement or applicable law; (viii) enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vii) with a term in excess of 12 months, it the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $2 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may (A) enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viii) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viii), Agreements and (B) those capital expenditures which do not exceed in the aggregate $2,000,000 (in addition to those other capital expenditures permitted under this subsection (viii)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller will not make any such mandated capital expenditures (unless the failure by Seller to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital Expenditures"); (ix) enter into any Contract with Affiliates and record the Declarations of Seller the term of which are not indicative of arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned AssetsSubdivision Easements; or (xiiix) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in the foregoing clauses (i) through (xiviii). (c) Without limiting the generality of Sections 7.1(a7.01(a) and (b), to the extent Section 7.1(a7.01(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise otherwise, reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 7.01 to the contrary, Seller may take cake any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, Obligations or (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.

Conduct of Business Relating to the Auctioned Assets. (a) Except with the prior written consent of Buyer (such consent not to be unreasonably withheld) or as required to effect the purchase and sale of the Auctioned Assets and related transactions contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Seller will operate the Auctioned Assets in the usual, regular and ordinary course and in accordance with Good Utility Practicesgood industry practice and applicable legal requirements, and continue to pay accounts payable which relate to the Auctioned Assets in a timely manner, consistent with past practice. (b) Notwithstanding the foregoing, except as contemplated in this Agreement or the Ancillary Agreements, prior to the Closing Date, without the prior written consent 48 41 of Buyer (such consent not to be unreasonably withheld), Seller will not: (i) except for Permitted Exceptions, grant any Encumbrance on the Auctioned Assets securing any indebtedness for borrowed money or guarantee or other liability for the obligations of any Personperson; (ii) make any material change in the levels of fuel inventory and supplies, materials and spare parts inventory customarily maintained by Seller with respect to the Auctioned Assets, other than consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); (iii) sell, lease (as lessor), transfer or otherwise dispose of, any of the Auctioned Assets, other than assets that become obsolete or assets used, consumed or replaced in the ordinary course of business consistent with past practicepractice (including the use of spare parts in connection with certain power generation assets of Seller described in the Offering Memorandum other than the Generating Plants or Gas Turbines); (iv) except as contemplated by Sections 7.9 and 7.17 with respect to the Unassigned PPAs, terminate, materially extend or otherwise materially amend any of the Material Contracts (other than in accordance with their respective terms) or waive any default by, or release, settle or compromise any material claim against, any other party thereto; (v) amend any of the Transferable Permits, other than (A) Transferable Permits not material to the operations of the Auctioned Assets as currently conducted, (B) as reasonably necessary to complete the transfer of Transferable Permits as contemplated hereby, and (C) routine renewals or non-material modifications or amendmentsamendments and (D) modifications, alterations and amendments contemplated by Section 7.03(b); (vi) enter into any Contract for the purchase, sale or storage of fuel (other than in the ordinary course of business) with respect to the Auctioned Assets (whether commodity or transportation) with a term in excess of 12 months and not terminable on or before the Closing Date either (A) automatically, or (B) by option of Seller (or, after the Closing, by Buyer) in its sole discretion, if the aggregate payments under such commitment for fuel and all other outstanding commitments for fuel (not previously approved by Buyer) would exceed $5,000,000; (vii) except in the case of capital expenditures covered by clause (viii) below, enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vi) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $1,000,0002 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that Seller 49 42 may enter into Contracts for the storage of fuel with respect to the Auctioned Assets with a term ending not later than December 31, 2000 and otherwise on terms consistent with Seller's past practice; (vii) (A) establish, adopt, enter into or amend any Collective Bargaining Agreement or Benefits Plans, except (1) if such action would not create a Material Adverse Effect or (2) as required under applicable law or under the terms of any Collective Bargaining Agreement or (B) grant to any Affected Employee any increase in compensation, except (1) in the ordinary course of business consistent with past practice or (2) to the extent required by the terms of any Collective Bargaining Agreement, employment agreement in effect as of the date of this Agreement or applicable law; (viii) enter into any Contract with respect to the Auctioned Assets for goods or services not addressed in clauses (i) through (vii) with a term in excess of 12 months, if the aggregate future liability or receivable outstanding on the date for measurement for the purpose of this covenant for all such Contracts would be in excess of $2 million, not including any such Contract terminable by notice of not more than 30 days without penalty or cost (other than de minimis administrative costs); provided, however, that notwithstanding any other provision of this Agreement to the contrary, Seller may (A) enter into any Contract reasonably necessary to effect the physical, legal or operational separation of the sites on which the Auctioned Assets are located or to otherwise implement the change of ownership contemplated hereby, or subdivision, of such sites or implement the provisions of the Ancillary Agreements; (viii) make, or commit to make, any capital expenditures except (A) those capital expenditures described on Schedule 7.1(b)(viii), Agreements and (B) those capital expenditures which do not exceed in the aggregate $2,000,000 (in addition to those other capital expenditures permitted under this subsection (viii)), (C) those capital expenditures which are approved by Buyer, or (D) those capital expenditures which are mandated by a law or regulation of a Governmental Authority; provided, however, that, in the case of clause (D), Seller will not make any such mandated capital expenditures (unless the failure by Seller to make such capital expenditures would have an adverse impact upon the Auctioned Assets) if (y) such mandated capital expenditures are not required to be made by Seller prior to the Closing Date, and (z) the Buyer assumes responsibility, at its sole cost, to make such mandated capital expenditures after the Closing (any capital expenditures described above are the "Permitted Capital Expenditures"); (ix) enter into any Contract with Affiliates and record the Declarations of Seller the term of which are not indicative of arms-length negotiations; (A) amend any Benefit Plans, or (B) grant any Employee an increase in compensation, except in the ordinary course of business consistent with past practice; (xi) make any tax election with respect to the Auctioned AssetsSubdivision Easements; or (xiiix) enter into any Contract with respect to the Auctioned Assets relating to any of the transactions set forth in the foregoing clauses (i) through (xiviii). (c) Without limiting the generality of Sections 7.1(a) and (b), to the extent Section 7.1(a) or (b) prohibits Seller from entering into any Contract for goods and services in connection with maintenance or capital expenditures, Buyer agrees that Seller may request Buyer's consent to enter into such Contract, such consent not to be unreasonably withheld, and to the extent Buyer so consents, all liabilities and obligations under such Contract shall constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for all its expenditures thereunder. (d) Notwithstanding anything in this Section 7.1 to the contrary, Seller may take any action, incur any expense or enter into any obligation with respect to the Auctioned Assets to the extent that (i) all obligations and liabilities arising with respect thereto do not constitute Assumed Obligations, (ii) such actions are at Seller's expense and are deemed by Seller to be necessary, or (iii) Seller otherwise provides that such obligations and liabilities shall not be assumed or retained by Buyer.