INSTALLMENT SALE AGREEMENT
THIS INSTALLMENT SALE AGREEMENT made and entered into as of December 29,
1992, by and between County of Clinton Industrial Development Agency (the
"Issuer"), a public benefit corporation duly organized and existing under the
Constitution and laws of the State of New York (the "State"), and Saranac Power
Partners, L.P., a limited partnership formed under and pursuant to the laws of
the State of Delaware (the "Company").
WITNESSETH:
WHEREAS, the New York State Industrial Development Agency Act, being Title
1 of Article 18-A of the General Municipal Law, Chapter 24 of the Consolidated
Laws of the State of New York, as amended (hereinafter referred to as the
"Enabling Act") authorizes the creation of industrial development agencies for
the benefit of the several counties, cities, villages and towns in the state of
New York and empowers such agencies, among other thing, to acquire, construct,
reconstruct, lease, improve, maintain, equip and furnish real and personal
property, whether or not now in existence or under construction, which shall be
suitable for, among others, manufacturing, warehousing, research, commercial or
industrial purposes, in order to advance the job opportunities, health, general
prosperity and economic welfare of the people of the State of New York and to
improve their recreation opportunities, prosperity and standard of living; and
WHEREAS, the Enabling Act further authorizes each such agency to lease or
sell its projects, to charge and collect rent, or the purchase price therefor,
to issue its bonds for the purpose of carrying out any of its corporate
purposes and, as security for the payment of the principal and redemption price
of, and interest on, any such bonds, to mortgage any or all of its facilities
and to pledge the revenues and receipts therefrom to the payment of such bonds;
and
WHEREAS, pursuant to and in accordance with the provisions of the Enabling
Act, Chapter 225 of the 1971 Laws of the State of New York, as amended (said
chapter and the Enabling Act being hereinafter collectively referred to as the
"Act") created the Agency for the benefit of Clinton County, New York and the
inhabitants thereof; and
WHEREAS, (i) the Company has acquired and will acquire fee title to,
leasehold interests in and certain easements to various parcels of real
property located in Clinton County, New York (such rights, title and interests
collectively referred to as the Land, as more specifically defined hereinbelow)
and has undertaken (a) to construct on the Land a 240MW natural gas-fired
cogeneration facility and related transmission lines and electric energy
interconnection facilities (the "Facility"), and (b) to acquire and install
certain Equipment (as hereinafter defined) (the Land, the Facility and the
Equipment being hereinafter collectively referred to as the "Project
Facility"); and (ii) the Issuer will sell or lease the Project Facility to the
Company under this installment sale agreement (hereinafter referred to as the
"Agreement") between the Issuer and the Company; and
WHEREAS, the Company submitted and application to the Issuer, and the
Issuer by a resolution has accepted such application, for the Issuer to issue
notes (the "Bonds") for the purposes of financing a portion of the costs of a
project (the "Project") consisting of (i) the acquisition, construction,
installation and equipping of the Project Facility, and (ii) the sale and/or
lease of the Project Facility to the Company; and
WHEREAS, the Issuer by resolution adopted on September 16, 1992 (the
"Inducement Resolution") determined to issue up to $400,000,000 aggregate
principal amount of its Bonds for the purposes of financing a portion of the
cost of the Project and by resolution adopted on December 29, 1992 (the "Bond
Resolution") determined to issue its Bonds for such purpose; and
WHEREAS, the Company, the Issuer, North Country Gas Pipeline Corporation,
a New York corporation ("North Country"), certain lending institutions (the
"Lenders") and General Electric Capital Corporation, as Agent to the Lenders,
have entered into a loan agreement dated as of December 29, 1992 (the "Loan
Agreement") pursuant to which the Lenders have agreed to make certain
extensions of credit, including, but not limited to, the loans to be evidenced
by the Bonds; and
WHEREAS, the Issuer proposes to undertake the Project, appoint the Company
as agent of the Issuer to undertake the acquisition, construction, and
installation of the Project Facility and sell the Project Facility to the
Company, and the Company desires to act as agent of the Issuer to undertake the
acquisition, construction and installation of the Project Facility and purchase
the Project Facility from the Issuer, all pursuant to the terms and conditions
hereinafter set forth; and
WHEREAS, the providing of the Project Facility and the sale of the Project
Facility to the Company pursuant to this Agreement is for a proper purpose to
wit, to advance the job opportunities, health, general prosperity and economic
welfare of the inhabitants of the State pursuant to the provisions of the
Enabling Act;
WHEREAS, this Agreement sets forth the terms and conditions pursuant to
which the Issuer agrees to sell and the Company agrees to purchase the Project
Facility; and
WHEREAS, all things necessary to constitute this Agreement a valid and
binding agreement by and between the parties hereto in accordance with the
terms hereof, have been done and performed, and the creation, execution and
delivery of this Agreement have in all respects been duly authorized;
NOW, THEREFORE, in consideration of the promises and the mutual covenants
hereinafter contained, the parties hereto agree as follows:
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ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
Section 1.1. DEFINITIONS. In addition to the words and terms elsewhere
defined in this Agreement, the following words and terms as used herein shall
have the following meanings unless the context or use clearly indicates another
or different meaning or intent, and any other words and terms not otherwise
defined in this Agreement shall have the same meanings when used herein as
assigned in Appendix A of the Loan Agreement, a copy of which is attached
hereto, unless the context or use clearly indicates another or different
meaning or intent:
"Acquisition", when used with reference to the Project Facility, means
acquisition, construction, installation and equipping.
"Agent" means General Electric Capital Corporation, as Agent as more
particularly described in the Loan Agreement, and any successor agent.
"Agreement" means this Installment Sale Agreement between the Issuer and
the Company and any modifications, alterations and supplements hereto made in
accordance with the provisions hereof.
"Assignment to Company" means an assignment agreement in form and
substance reasonably satisfactory to the Issuer and the Company pursuant to
which the Issuer shall assign to the Company (i) the Easements and (ii) the
Leases.
"Assignment to Issuer" means the assignment and assumption of agreements
dated the Closing Date, given by the Company to the Issuer conveying all of the
Company's right, title and interest in and to the G-P Leases and the Easements,
and improvements thereon, to the Issuer.
"Assignment to NYSEG" means an assignment agreement in form and substance
reasonably satisfactory to the Issuer and the Company pursuant to which the
Issuer shall assign to NYSEG the NYSEG Easements.
"Authorized Representative" means the Person or Persons at the time
designated to act on behalf of the Issuer or the Company, as the case may be,
by written certificate containing the specimen signature of each such Person
and signed on behalf of (A) the issuer by its Chairman or Vice Chairman, or
such other person as may be authorized by resolution of the Issuer, and (B) the
Company by the President or any Vice President of its General Partner, or such
other persons as may be authorized by the Company.
"Xxxx of Sale to Company" means the xxxx of sale in form and substance
reasonably satisfactory to the Issuer and the Company pursuant to which the
Issuer shall convey the Issuer's interest in the Equipment to the Company.
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"Xxxx of Sale to G-P" means a xxxx of sale in form and substance
reasonably satisfactory to the Issuer and the Company pursuant to which the
Issuer shall convey its interest in the G-P Equipment to Georgia Pacific.
"Xxxx of Sale to Issuer" means the xxxx of sale dated the Closing Date
from the Company to the Issuer conveying the Company's right, title and
interest in the Equipment.
"Xxxx of Sale to NYSEG" means a xxxx of sale in form and substance
reasonably satisfactory to the Issuer and the Company pursuant to which the
Issuer shall convey its right, title and interest in the NYSEG Equipment to
NYSEG.
"Bond Documents" means, collectively, the Bonds, this Agreement, the Loan
Agreement, the Saranac PILOT Mortgage, the XXX Building Loan Mortgage, the XXX
Development Loan Mortgage, the Partnership/North Country Development Loan
Mortgage, the NYSEG Subordinated Mortgage, the Georgia-Pacific Mortgage and
Security Agreement, the Partnership Security Agreement, the XXX North Country
Security Agreement, the Partnership Development Loan Note, the Saranac PILOT
Agreement, the Assignments to Issuer, the Bills of Sale to Issuer, the Deed to
Issuer, the [Site Transmission Line] Short-Form Construction Loan Agreement,
the [Pipeline] Short-Form Construction Loan Agreement, the Security Deposit
Agreement, the XXX (North Country) Building Loan Mortgage, the XXX (North
Country) Building Loan Note, the XXX (North Country) Development Loan Mortgage,
the XXX (North Country) Development Loan Note, the XXX (North Country)
Installment Sale Agreement, the North Country PILOT Agreement, the North
Country PILOT Mortgage and the Construction Contract.
"Bonds" means the XXX Building Loan Note and the XXX Development Loan
Note.
"Budgets" means, collectively, the XXX Development Loan Budget and the XXX
Building Loan Budget.
"Closing Date" means the Conformed Agreement Date as defined in the Loan
Agreement.
"Completion Date" means the date the Acquisition of the Project Facility
is certified as being complete in accordance with this Agreement.
"Cost(s) of the Project", "Cost" or "Costs" means all fees, costs and
allowances which the Issuer or the Company may properly pay or accrue for the
Project Facility, and which, under generally accepted accounting principles,
are chargeable to the capital account of the Project Facility or could be so
charged either with a proper election to capitalize such costs or, but for a
proper election, to expense such costs, including (without limitation) the
following costs:
(a) Fees and expenses incurred in preparing the plans and specifications
for the Project Facility (including any
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preliminary study or planning or any aspect thereof); any labor, services,
materials and supplies used or furnished in Land acquisition, improvement and
construction; any Equipment for the Project Facility; and any acquisition
necessary to provide utility services or other services, including, trackage to
provide the Project Facility with public transportation facilities, roadways,
parking lots, water supply, sewage and waste disposal facilities; all interests
in real and tangible personal property deemed necessary by the Company and
acquired in connection with the Project Facility; insurance as required under
the Loan Agreement or herein; payment of fees and commissions payable to GECC
pursuant to the Loan Agreement; and payments of miscellaneous expenses
incidental to any of the foregoing items.
(b) The fees for architectural, engineering, legal counsel and supervisory
and consulting services in connection with the Project Facility;
(c) Any fees and expenses incurred in connection with perfecting and
protecting title to the Project Facility and any fees and expenses incurred in
connection with preparing, recording or filing such documents, instruments or
financing statements as either the Company or the Issuer may deem desirable to
perfect or protect the rights of the Issuer or the Lenders under the Bond
Documents or the Loan Documents;
(d) The legal, accounting or financing advisory fees and expenses, any
fees and expenses of the Issuer, Agent, Lenders, filing fees, and printing and
engraving costs, including, without limitation, fees and expenses of bond
counsel and the counsel to the Issuer and special counsel to the Issuer,
incurred in connection with the authorization and issuance of the Bonds, and
the preparation of the Bond Documents and all other documents in connection
with the authorization and issuance of the Bonds;
(e) Interest to accrue on the Bonds during construction of the Project
Facility;
(f) Any administrative or other fees charged by the Issuer or
reimbursement thereto of expenses in connection with the Project until the
Completion Date;
(g) Payment of taxes including property taxes, assessments and other
charges, if any, or payments in lieu of taxes with respect thereof, or
reimbursement thereof if paid by the Company, and
(h) Any other costs and expenses relating to the Project which could
constitute costs or expenses for which the Issuer may expend Bond proceeds
under the Act.
"Deed to the Company" means a deed in form and substance reasonably
satisfactory to the Issuer and the Company pursuant to which the Issuer shall
convey its right, title and interest in the Fee Premises to the Company.
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"Deed to G-P" means a deed in form and substance reasonably satisfactory
to the Issuer, the Company and Georgia Pacific pursuant to which the Issuer
shall convey all of its right, title and interest in the G-P Premises to
Georgia Pacific.
"Deed to Issuer" means the deed dated the Closing Date given by the
Company to the Issuer conveying all of the Company's interest in the Fee
Premises to the Issuer.
"Deed to NYSEG" means a deed in form and substance reasonably satisfactory
to the Issuer, the Company and NYSEG pursuant to which the Issuer shall convey
all of its right, title and interest in the NYSEG Fee Premises to NYSEG.
"Easement Premises" means the portions of the Land covered by the
Easements.
"Easements" means the agreements described on Exhibit A-1 attached hereto
and the easements and licenses to be obtained upon the completion of the
condemnation proceeding described on Exhibit A-2 hereto; provided, however,
that from and after the execution and delivery of the Assignment to NYSEG, the
term Easements shall not include the NYSEG Easements.
"Equipment" means all machinery and equipment to be installed in or
utilized in connection with the construction of the Project Facility; provided,
however, that (i) from and after the execution and delivery of the Xxxx of Sale
to G-P, the term Equipment shall not include the G-P Equipment and (ii) from
and after the execution and delivery of the Xxxx of Sale to NYSEG, the term
Equipment shall not include the NYSEG Equipment.
"Eminent Domain" means the taking of title to, or the temporary use of,
the Project Facility or any part thereof pursuant to eminent domain or
condemnation proceedings or by any settlement or compromise of such
proceedings, or any voluntary conveyance of the Project Facility or any part
thereof during the pendency of, or as a result of a threat of, such
proceedings.
"Event of Default" shall have the meaning set forth in Section 10.1
hereof.
"Fee Premises" means the portions of the Land described on Exhibit B
attached hereto; provided, however, that (i) from and after the execution and
delivery of the Deed to G-P, the term Land shall not include the G-P Premises,
and (ii) from and after the execution and delivery of the Deed to NYSEG, the
term Land shall not include the NYSEG Fee Premises.
"GECC" shall have the same meaning as "GE Capital" as set forth in the
Loan Agreement.
"Georgia Pacific" means the Georgia-Pacific Corporation, a Georgia
corporation.
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"G-P Equipment" means the portion of the Equipment located on the G-P
Premises.
"G-P Leases" means the leases between the Company and Georgia Pacific
described in Exhibit C attached hereto.
"G-P Premises" means the portions of the Land described in Exhibit D
attached hereto.
"Governmental Authorities" means the United States of America, the State
and any political subdivision thereof, and any agency, department, commission,
court, board, bureau or instrumentality of any of them.
"XXX Building Loan Note" shall have the same meaning as set forth in the
Loan Agreement.
"XXX Development Loan Note" shall have the same meaning as set forth in
the Loan Agreement.
"Installment Purchase Payments" means the payments made by the Company to
the Issuer in accordance with Section 5.2 hereof.
"Issuer Representative" means any one of the persons at the time
designated to act on behalf of the Issuer by written certificate furnished to
the Company containing the specimen signatures of such persons and signed on
behalf of the Issuer by its Chairman or Vice chairman.
"Land" shall mean, collectively, the Fee Premises, the Leasehold Premises
and the Easement Premises.
"Leasehold Premises" means the portions of the Land described in Exhibit E
attached hereto.
"Lenders" means the financial institutions parties to the Loan Agreement
from time to time.
"Lien" shall have the meaning as set forth in the Loan Agreement.
"Loan Agreement" means the Loan Agreement dated as of the Closing Date by
and among the Borrowers, the Lenders and the Agent.
"Loan Agreement Permitted Lien" shall have the meaning as set forth in the
Loan Agreement.
"Mortgage" shall mean collectively the XXX Building Loan Mortgage, the XXX
Development Loan Mortgage and the Partnership Development Loan Mortgage.
"Net Proceeds", when used with respect to any proceeds of insurance or
proceeds resulting from Eminent Domain, means the gross proceeds therefrom less
all expenses (including attorneys' fees) incurred in realization thereof.
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"North Country" means the North Country Gas Pipeline Corporation, a New
York corporation.
"North Country PILOT Agreement" shall have the meaning as set forth in the
Loan Agreement.
"NYSEG" means New York State Electric & Gas Corporation, a New York
corporation.
"NYSEG Easements" means the portion of the Easements described on Exhibit
F attached hereto.
"NYSEG Equipment" means the portion of the Equipment located on the land
covered by the NYSEG Easements and the NYSEG Fee Premises.
"NYSEG Fee Premises" means the portion of the Fee Premises described on
Exhibit G attached hereto.
"Permitted Encumbrances" shall have the same meaning as Loan Agreement
Permitted Liens as set forth in the Loan Agreement.
"PILOT Agreements" shall mean collectively the Saranac PILOT Agreement and
the North Country PILOT Agreement.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Saranac PILOT Agreement" shall have the meaning as set forth in the Loan
Agreement.
"Saranac PILOT Mortgage" shall have the meaning as set forth in the Loan
Agreement.
"State" means the State of New York.
"Unassigned Rights" means (i) the indemnification rights of the Issuer
granted pursuant to Sections 8.6, 8.7 and 12.14 of this Agreement, (ii) the
monies due and to become due the Issuer for its own account or to the members,
officers, agents and employees of the Issuer for their own account pursuant to
Sections 5.2, 6.8, 8.6, 10.3 and 10.5 of this Agreement, (iii) the rights of
the Issuer to receive notices, reports and other statements hereunder, (iv) the
right of the Issuer to provide consents or receive notices hereunder, (v) the
rights of access and inspection provided to the Issuer hereunder, (vi) the
rights of the Issuer under Sections 12.4 and 12.5 hereof, (vii) the right of
the Issuer to receive the covenants of the Company under Section 2.2(h) and (i)
hereof, (viii) the rights of the Issuer under Sections 3.1(f), 3.1(g), 6.2,
6.4, 8.8, 8.13, 8.17, 8.18, 9.3 and 10.3 of this Agreement, and (ix) the right
to enforce the foregoing pursuant to Article X of this Agreement.
Section 1.2. RULES OF CONSTRUCTION. Unless the context clearly indicates
to the contrary, the following rules shall apply to the construction of this
Agreement.
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(a) Capitalized terms used but not defined in this Agreement shall have
the meaning ascribed to them in the Loan Agreement.
(b) Words importing the singular number shall include the plural number
and vice versa.
(c) The table of contents, captions and headings herein are solely for
convenience of reference only and shall not constitute a part of this Agreement
nor shall they affect its meaning, construction or effect.
(d) Words of the masculine gender shall be deemed and construed to include
correlative words of the feminine and neuter genders, and words of the neuter
gender shall be deemed and construed to include correlative words of the
masculine and feminine genders.
(e) All references in this Agreement to particular Articles or Sections
are references to Articles and Sections of this Agreement, unless otherwise
indicated.
ARTICLE II
REPRESENTATIONS
Section 2.1. REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE ISSUER. The
Issuer represents and warrants as follows:
(a) The issuer is an industrial development agency within the meaning of
the Act, is duly established under the provisions of the Act and is authorized
by the Act to acquire the Project Facility and to enter into this Agreement and
the transactions contemplated herein and to carry out its obligations
hereunder, has been duly authorized by its governing body to execute, deliver
and perform this Agreement and to carry out its obligations hereunder, and will
do or cause to be done all things necessary to preserve and keep this Agreement
in full force and effect. The Project Facility will constitute a "project" as
that term is defined in the Act.
(b) The Issuer has all requisite power, authority and legal right to
execute and deliver the Bond Documents to which it is a party and all other
instruments and documents to be executed and delivered by the Issuer pursuant
thereto, to perform the provisions thereof and to carry out the transactions
contemplated by the Bond Documents, including the issuance of the Bonds. All
corporate action on the part of the Issuer which is required for the execution,
delivery and performance by the Issuer of the Bond Documents has been duly
authorized and effectively taken, and such execution, delivery and performance
by the Issuer do not contravene applicable law or any contractual restriction
binding on or affecting the Issuer, nor will the same constitute a default by
the Issuer under any of the foregoing.
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(c) The Issuer has duly approved the issuance of the Bonds and the
Acquisition of the Project Facility; no other authorization or approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body is required as a condition to the performance by the Issuer or
its obligations under any Bond Documents.
(d) The bonds shall be issued under and pursuant to the provisions of the
Loan Agreement and shall finance the Costs of the Project.
(e) This Agreement is, and each other Bond Document to which the Issuer is
a party when delivered will be, legal valid and binding special obligations of
the Issuer enforceable against the Issuer in accordance with its terms.
(f) There is no default of the Issuer in the payment of the principal of
or interest on any of its indebtedness for borrowed money or under any
instrument or instruments or agreements under and subject to which any
indebtedness for borrowed money has been incurred which does or could affect
the validity and enforceability of the Bond Documents or the ability of the
Issuer to perform its obligations thereunder, and, to the knowledge of the
Issuer, no event has occurred and is continuing under the provisions of any
such instrument or agreement which constitutes or, with the lapse of time or
the giving of notice, or both, would constitute such a default.
(g) There is not pending or, to the knowledge of the Issuer, threatened
any action or proceeding before any court, governmental agency or arbitrator
(i) to restrain or enjoin the issuance or delivery of the Bonds, (ii) in any
way contesting or affecting the authority for the issuance of the Bonds, or the
validity of any of the Bond Documents, or (iii) in any way contesting the
existence or powers of the Issuer.
(h) In connection with the authorization and issuance of the Bonds, the
Issuer has complied with all provisions of the Constitution and laws of the
State, including the Act.
(i) The Issuer has not assigned, encumbered or pledged and will not
assign, encumber or pledge its interest in this Agreement or the Project
Facility (or any part thereof) for any purpose other than as contemplated under
the Loan Agreement or the Bond Documents.
(j) The Issuer is not in default under any of the provisions of the laws
of the State, where any such default would affect the issuance, validity or
enforceability of the Bonds or the transactions contemplated by this Agreement
or the Loan Agreement.
(k) So long as any Bonds shall remain unpaid, the Issuer will, upon
request of the Agent and provided it shall be furnished with indemnification as
set forth in Section 12.5 below and with sufficient funds to pay all costs and
expenses (including
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attorneys' fees) reasonably incurred by it as such costs and expenses accrue:
(i) take all action and do all things which it is authorized by law to
take and do in order to perform and observe all covenants and agreements on
its part to be performed and observed under the Bond Documents; and
(ii) execute, acknowledge where appropriate, and deliver from time to
time all such instruments and documents as are necessary or desirable to
carry out the intent and purpose of the Bond Documents.
(l) The Issuer has been induced to enter into this Agreement by the
undertaking of the Company to develop the Project Facility in the County of
Clinton, New York.
(m) The Issuer shall cooperate with the Company in the filing by the
Company, as agent of the Issuer, of such applications, returns and other
information with any Governmental Authority as is required by any applicable
law or regulation; provided, however, that the Company shall bear all costs of
preparing, gathering and filing such documents.
(n) The Issuer agrees to promptly record all deeds, and/or assignments, as
appropriate, at its own expense (subject to reimbursement as contemplated by
Sections 2.2(j) and 5.2(c)) and upon the direction of the Company, upon the
transfer of title to the Company, NYSEG or Georgia Pacific of portions of the
Project Facility in accordance with Section 5.1(b) hereof.
Section 2.2. REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE COMPANY. The
Company represents, warrants and covenants as follows:
(a) (i) The Company is a limited partnership duly organized and validly
existing and in good standing under the laws of the state of Delaware, is duly
qualified to do business in the State, and has full partnership and other legal
power and authority to execute, deliver and perform the covenants on its part
contained in the Bond Documents and the Basic Documents to which it is a party,
and has duly authorized the execution, delivery and performance of the Bond
Documents and the Basic Documents to which it is a party and has duly approved
such Bond Documents and Basic Documents.
(ii) Saranac Energy Company, Inc. is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
is duly qualified to do business in the State, and is the only general partner
of the Partnership.
(b) The execution and delivery of the Bond Documents and Basic Documents
to which it is a party, consummation of the transactions contemplated hereby
and thereby, and the fulfillment of or compliance with the terms and conditions
hereof and thereof will not conflict with or constitute a breach of or a
default under
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the Company's agreement of limited partnership or the articles of incorporation
or bylaws of the general partner of the Company or any agreement or instrument
to which the Company or the general partner of the Company is a party, or any
existing law, administrative regulation, court order or consent decree to which
the Company is subject, or by which it or any of its property is bound, or
result in the creation or imposition of any prohibited lien, charge or
encumbrance upon any of the property or assets of the Company or the general
partner of the Company under the terms of any instrument or agreement to which
the Company or such general partner is a party or by which it is bound.
(c) There is no action, suit, proceeding, inquiry or investigation, at law
or in equity, before or by any court, public board or body, pending or, to the
best of the Company's knowledge, threatened against or affecting the Company or
any of its partners, wherein an unfavorable decision, ruling or finding would
materially adversely affect the transactions contemplated by this Agreement or
that would adversely affect, in any way, the validity or enforceability of any
of the Bond Documents or the Basic Documents or any other agreement or
instrument to which the Company is a party and that is to be used or
contemplated for use in the consummation of the transactions contemplated
hereby.
(d) No consent, authorization, approval or action is required to be made,
obtained or complied with prior to the execution, delivery and performance by
the Company of its obligations hereunder or under the other Bond Documents and
Project Documents that has not been made, obtained or complied with, other than
the Governmental Approvals and other consents and approvals listed in Schedules
4 and 3 of the Loan Agreement. Each of this Agreement, the other Bond Documents
and the other Basic Documents to which the Company is a party has been duly
executed and delivered by the Company and constitutes a legal, valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the rights of creditors generally and by general principal of equity.
(e) The Company will fully and faithfully perform all the material duties
and obligations that it is required to perform pursuant to the Bond Documents
to which it is a party and the other Basic Documents and will perform or cause
to be performed, for and on behalf of the Issuer, each and every affirmative
obligation of the Issuer under and pursuant to the Mortgage and each Basic
Document to which the Issuer is a party to the extent any such duties and
obligations are reasonably capable of performance by the Company. The Company
shall defend, indemnify and hold the Issuer and its officers, directors,
members, agents, and employees harmless from any liability or expense resulting
from any failure by the Company to comply with this paragraph.
(f) No further authorizations, consents or approvals of governmental
bodies or agencies are required in connection with the execution and delivery
by the Company of this Agreement or the
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other Bond Documents or Basic Documents to which the Company is a party or in
connection with the carrying out by the Company of its obligations under this
Agreement or the other Bond Documents or Basic Documents to which the Company
is a party.
(g) The financing of the Project Facility as provided under the Loan
Agreement, and the participation of the Issuer therein have induced the Company
to locate its Project Facility in the jurisdiction of the Issuer. The providing
of the Project Facility by the Issuer and the sale thereof by the Issuer to the
Company (and, as provided herein, the conveyance of (i) the NYSEG Easements,
the NYSEG Fee Premises and the NYSEG Equipment to NYSEG and (ii) the G-P
Premises and the G-P Equipment to Georgia-Pacific) hereby will not result in
the removal of an industrial or manufacturing plant or commercial activity of
the Company or its general partner from one area of the State to another area
of the State or in the abandonment of one or more plants or facilities of the
Company or its general partner located within the State.
(h) After the Company completes the Acquisition of the Project, the
Company shall utilize the Project as a "project" within the meaning of the Act
until the conveyance of the Project Facility to the Company in accordance
herewith.
(i) The Project Facility will be acquired, constructed installed and
operated in such manner as to conform in all material respects with all
applicable zoning, planning, building, environmental and other regulations of
any governmental authorities having jurisdiction of the Project Facility. The
Company shall defend, indemnify and hold the Issuer and its officers,
directors, members, agents, and employees harmless from any liability or
expense resulting from any failure by the Company to comply with this
paragraph.
(j) The Company shall promptly reimburse the Issuer for any expenses,
including, but not limited to, legal, accounting or filing fees, incurred in
connection with the fulfillment of the covenant contained herein above in
Section 2.1(n).
(k) The Company shall comply in all material respects with all mitigating
measures, requirements and conditions, if any, identified in (i) the Findings
Statement adopted by the Issuer and (ii) the documents accepted by the State
Department of Environmental Conservation as the final environmental impact
statement with respect to the Project Facility.
(l) All proceeds of the Bonds shall be used to pay Costs of the Project.
13
ARTICLE III
ACQUISITION OF THE PROJECT
Section 3.1. ACQUISITION OF THE LAND; CONSTRUCTION OF THE FACILITY;
ACQUISITION AND INSTALLATION OF THE EQUIPMENT.
(a) The Company shall, on behalf of the Issuer, and with due diligence,
(1) acquire the Land or cause the Land to be acquired, (2) construct the
Facility or cause the Facility to be constructed, and (3) acquire and install
the Equipment or cause the acquisition and installation of the Equipment, all
in accordance with the Plans and Specifications. The approval of the Issuer
shall not be required for changes in the Plans and Specifications which do not
substantially alter the purpose and description of the Project Facility as set
forth in the Exhibits hereto.
(b) In the event that the Company desires to amend or supplement the
Project Facility and such amendment or supplement substantially alters the
purpose and description of the Project Facility as described in the Exhibits
hereto, the Issuer will enter into such amendment or supplement upon receipt
of:
(i) a certificate of an Authorized Representative of the Company
describing in detail the proposed changes and stating that they will not
have the effect of disqualifying the Project Facility as a cogeneration
project that may be financed pursuant to the Act and that they will not
violate any permits in existence relating to the Project Facility or that
such permits will be amended to permit such changes;
(ii) a copy of the proposed form of amended or supplemented Exhibits
hereto; and
(iii) the written consent of the Agent.
(c) Title to all materials, equipment, machinery and other items of
Property intended to be incorporated or installed in and to become part of the
Project Facility shall vest in the Issuer immediately upon deposit on the Land
or incorporation or installation in the Facility, whichever shall first occur.
The Company shall execute, deliver and record or file all instruments necessary
or appropriate to so vest title in the Issuer and shall take all action
necessary or appropriate to protect such title against claims of any third
Persons.
(d) The Issuer shall enter into, and accept the assignment of such
contracts as the Company may request in order to effectuate the purposes of
this Section 3.1, provided, however, that the liability of the Issuer
thereunder shall be subject to Sections 12.4 and 12.5 hereof.
(e) The Issuer hereby appoints the Company its true and lawful agent and
the Company hereby accepts such agency, (1) to acquire the Land, construct the
Facility, and acquire and install
14
the Equipment in accordance with the Plans and Specifications, (2) to make,
execute, acknowledge and deliver any contracts; orders, receipts, writings and
instructions with any other Persons, and in general to do all things which may
be requisite or proper, all for the acquisition, construction and equipping of
the Project Facility with the same powers and with the same validity as the
Issuer could do if acting in its own behalf, (3) to pay all fees, costs and
expenses incurred in the acquisition, construction and equipping of the Project
Facility from funds made available therefor in accordance with the Loan
Agreement, (4) to apply for all permits and licenses, (5) to request on behalf
of the Issuer, and receive for the purpose of paying the Costs of the Project,
advances of funds pursuant to the Loan Agreement, (6) to ask, demand, xxx for,
xxxx, recover and receive all such sums of money, debts, dues and other demands
whatsoever which may be due, owing and payable to the Issuer under the terms of
any contract, order, receipt or writing in connection with the acquisition,
construction, equipping and installation of the Project Facility, and to
enforce the provisions of any contract, agreement, obligation, bond or other
performance security, (7) to take all actions necessary or in the opinion of
the Company desirable for the construction and, to the extent permitted by law,
the operation, use, repair and maintenance of the Project Facility for its
intended purposes, including, to the extent permitted by law, the institution
and prosecution of a condemnation proceeding to obtain all necessary or
riparian rights necessary for the Project Facility, (8) to the extent permitted
by law, to obtain, negotiate, execute and deliver agreements, contracts and/or
leases for the management, maintenance and operation of the Project Facility
and the sale of electric power generated at the Project Facility to third
persons, and (9) to appoint sub-agents of the Issuer to do any or all of the
foregoing. The agency designation granted hereby shall be irrevocable and shall
vest the Company with complete authority and discretion with respect to the
matters referred to above and, prior to the occurrence of an Event of Default,
the Issuer shall not have the right to interfere with, direct or control the
Company in the performance of the foregoing duties. In order to facilitate the
securing of an exemption from State sales and use taxes as such exemption may
be in existence during the period in which this Agreement is in effect and the
Project is being constructed and the Equipment installed, the Issuer hereby
agrees to provide to the Company any letter or certificate reasonably requested
by the Company for such purpose, to the extent permitted under New York law,
and the Company agrees to pay or reimburse the Issuer for any costs, including
reasonable legal fees, incurred in connection therewith. Notwithstanding the
first sentence of this paragraph (e) and anything in this Agreement to the
contrary, the Issuer shall not provide any letter or certificate to the Company
securing any State sales and use tax exemption for the Project Facility for the
period beginning on the Construction Loan Maturity Date and ending on the date
of termination of this Agreement.
(f) The Company shall give, or cause to be given, all notices and comply
or cause compliance with all laws, ordinances, municipal rules and regulations
and requirements of all
15
Governmental Authorities applying to or affecting the conduct of work on the
Project Facility, and the Company will defend, indemnify and save the Issuer
and its officers, members, agents, servants and employees harmless from all
fines and penalties due to failure to comply therewith. All permits and
licenses necessary for the prosecution of work on the Project Facility shall be
procured or caused to be procured promptly by the Company.
(g) The Company, as agent for the Issuer, in compliance with Section 13 of
the Lien Law of the State (but without conceding the applicability of such
Section 13), covenants that it (i) will hold the right to receive the proceeds
of the XXX Building Loan Note as a trust fund to be applied first for the
purpose of paying the "cost of improvements" (as such item is defined in
subdivision 5 of Section 2 of the Lien Law) and (ii) will apply the same first
to the payment of the "cost of improvement" before using any part of the total
of same for any other purposes.
Section 3.2. AGREEMENT TO PROCURE FINANCING. To facilitate the provision
of funds to finance the Project Facility, the Issuer agrees to execute and
deliver the Bond Documents and other Basic Documents to which it is a party and
any certificates or letters reasonably required thereby, subject to the payment
or reimbursement of any reasonable costs incurred by the Issuer in accordance
with the terms of this Agreement.
Section 3.3. DISBURSEMENTS OF LOAN PROCEEDS. The Company, on behalf of
itself and as agent of the Issuer, shall qualify for, obtain and apply advances
of funds under the Loan Agreement sufficient to permit the Acquisition of the
Project Facility in accordance with the terms of the Loan Agreement. The
Company shall not agree to, or accept any modification or waiver of, the
provisions of the Loan Agreement if such modification or waiver would result in
proceeds of the Bonds being used to pay costs that are not Costs of the
Project.
Section 3.4. ESTABLISHMENT OF COMPLETION DATE. The Company will proceed
with due diligence to complete the Acquisition of the Project Facility.
Completion of the Acquisition of the Project Facility shall be evidenced as set
forth in the Loan Agreement.
Section 3.5. COMPLETION BY THE COMPANY.
(a) In the event that the proceeds of the XXX Building Loan Note and the
XXX Development Loan Note are not sufficient to pay in full all costs of
acquiring the Land, constructing the Facility and acquiring and installing the
Equipment in accordance with the Loan Agreement, the Company agrees, for the
benefit of the Issuer and the Agent, subject to Section 12.1 hereof, to
complete such acquisition, construction, installation and equipping and to pay
all such sums as may be in excess of the proceeds of the XXX Building Loan Note
and the XXX Development Loan Note. Title to all portions of the Facility
constructed or of the Equipment installed or acquired pursuant to the previous
sentence at Company's expense shall immediately upon such construction,
installation or acquisition vest in the Issuer. The Company shall execute,
deliver
16
and record or file such instruments as the Issuer may reasonably request in
order to perfect or protect the Issuer's title to such portions of the Facility
and Equipment.
(b) No payment by the Company pursuant to this Section 3.5 shall entitle
the Company to any reimbursement for any such expenditure from the Issuer or
the Agent or to any diminution or abatement of any amounts payable by the
Company under this Agreement.
Section 3.6. REMEDIES TO BE PURSUED AGAINST CONTRACTORS, SUBCONTRACTORS,
MATERIALMEN AND THEIR SURETIES. In the event of a default by any contractor,
subcontractor or materialman under any contract made by it in connection with
the construction of the Facility or the acquisition and installation of the
Equipment or in the event of a breach of warranty or other liability with
respect to any materials, workmanship, or performance guaranty, the Company may
proceed, either separately or in conjunction with others, to exhaust the
remedies of the Company and the Issuer against the contractor, subcontractor or
materialman so in default and against each surety for the performance of such
contract. The Company may, in its own name or in the name of the Issuer,
prosecute or defend any action or proceeding or take any other action involving
any such contractor, subcontractor, materialman or surety which the Company
deems reasonably necessary, and in such event the Issuer hereby agrees, at the
Company's sole expense, to cooperate fully with the Company and to take all
action necessary to effect the substitution of the Company for the Issuer in
any such action or proceeding. The Company shall advise the Issuer of any
actions or proceedings taken hereunder. The proceeds of any recovery secured by
the Company as a result of any action pursued against a contractor,
subcontractor, materialman or their sureties pursuant to this Section 3.6 shall
be used to complete the Project Facility and shall thereafter be payable to the
Company.
ARTICLE IV
[RESERVED]
ARTICLE V
AGREEMENT TO CONVEY PROJECT; PAYMENT PROVISIONS
Section 5.1. INSTALLMENT SALE.
(a) The Company has conveyed or will convey to the Issuer (i) by deed
pursuant to the Deed to Issuer, dated the Closing Date, its right, title and
interest in and to the Fee Premises and all improvements thereon, including,
without limitation, the Facility, and (ii) by assignment pursuant to the
Assignment to Issuer, dated the Closing Date, its right, title and interest in
and to the Leasehold Premises and the Easement Premises, and all improvements
thereon. The Company agrees that
17
such title shall be free and clear of all liens except for Loan Agreement
Permitted Liens. All right, title and interest of the Company in and to any
Equipment has been or will be conveyed to the Issuer by the Xxxx of Sale to
Issuer, dated the Closing Date.
(b) In consideration of the Company's covenant herein to make Installment
Purchase Payments, and in consideration of the other covenants of the Company
contained herein, including the covenant to make additional and other payments
required hereby, the Issuer hereby agrees to (i) convey to NYSEG all of the
Issuer's right, title and interest to the NYSEG Fee Premises, the NYSEG
Easements and the NYSEG Equipment, pursuant to the Deed to NYSEG, Assignment to
NYSEG and the Xxxx of Sale to NYSEG, upon the request of the Company made in
accordance with the provisions of the Loan Agreement, and (ii) convey to
Georgia-Pacific the G-P Premises and the G-P Equipment, pursuant to the Deed to
G-P and the Xxxx of Sale to G-P upon the request of the Company made in
accordance with the provisions of the Loan Agreement, and (iii) on the earlier
of (x) termination of this Agreement pursuant to Section 10.2 hereof, or (y) on
the date of the termination of the Saranac PILOT Agreement, sell and convey to
the Company, and the Company hereby agrees to purchase and acquire from the
Issuer, all of the Issuer's right, title and interest in the Project Facility,
pursuant to the Deed to the Company, the Assignment to the Company, the Xxxx of
Sale to the Company, and such other sale, transfer or conveyancing documents as
may be reasonably requested by the Company, with title to pass to the Company
on the date on such date; provided, however, that if the Loan Agreement shall
be in effect, the Agent shall have consented thereto. To obligation of the
Issuer under this Section 5.1(b) to convey the Project Facility to the Company
shall be subject to there being no Event of Default existing hereunder, or any
other event which would, but for the giving of notice, the passage of time, or
both, be any such Event of Default. The Company covenants to promptly record or
cause to be recorded the sale, transfers or conveyancing documents for the
conveyances set forth above in clauses (i), (ii) and (iii) above.
(c) Until title to the Project Facility shall be conveyed to the Company
in accordance with the provisions of Section 5.1(b) above, the Company shall
have, and the Issuer does hereby grant unto the Company, a present possessory
right to enter upon, use, maintain, operate, construct, rehabilitate, lease and
otherwise deal with the Project Facility, subject, however, to the terms, and
provisions of this Agreement and the Loan Agreement. So long as no Event of
Default shall exist hereunder, the foregoing present possessory right shall be
irrevocable and is hereby deemed to be coupled with an interest.
(d) Subsequent to the Closing Date, the Company shall be entitled to use
the Project Facility in any manner not otherwise prohibited by the Bond
Documents or other Project Documents, provided that such use causes the Project
Facility to qualify or continue to qualify as a "project" under the Act.
Section 5.2. AMOUNTS PAYABLE. The Company here by agrees to pay the sum of
the following amounts as hereinafter set forth:
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(a) The Company, on its behalf and on behalf of the Issuer, agrees to pay
all amounts due under the Bonds and the Loan Agreement in accordance with the
terms thereof; provided, however, that if no amounts remain outstanding under
the Loan Agreement, the Company shall pay to the Issuer one dollar ($1.00) per
annum on January 1 of each calendar year until the termination of this
Agreement.
(b) The Company shall pay the amounts referenced in Section 6.2 herein.
(c) The Company will also pay when due and payable the fees and reasonable
expenses of the Issuer and the officers, members, agents (except for the
Company) and employees thereof, including any filing or recordation fees and
related reasonable legal fees incurred by the Issuer, related to the issuance
of the Bonds and the ownership, sale or financing of the Project Facility (or
portions thereof) or in connection with the carrying out of the Issuer's duties
and obligations as contemplated under any Bond Document or other Basic
Document, or any other such fee or expense of the Issuer or its officers,
members, agents (except for the Company) and employees, the payment of which is
not otherwise provided for under this Agreement, including without limitation,
reasonable attorneys' fees and expenses.
(d) The Company shall pay all rents and other amounts from time to time
payable under the G-P Leases.
(e) In the event the Company shall fail to make any of the payments
required in this Section 5.2, the item or installment so in default shall
continue as an obligation of the Company until the amount in default shall have
been fully paid; provided, however, that all amounts due under subsections (b)
and (c) above shall accrue interest at the lesser of (i) 24 percent (24%) per
annum and (ii) the maximum rate permitted by law and all amounts due under
subsection (a) above shall accrue interest at the rates set forth in the Loan
Agreement.
Section 5.3. UNCONDITIONAL OBLIGATIONS. Subject to Section 12.1, the
obligation of the Company to make the payments required by Section 5.2 above
shall be absolute and unconditional. The Company shall pay all such amounts
without abatement, diminution or deduction (whether for taxes or otherwise)
regardless of any cause or circumstance whatsoever including, without
limitation, any defense, set-off, recoupment or counterclaim that the Company
may have or assert against the Issuer or any other Person, or the conveyance of
title to the Project Facility pursuant to this Agreement. The Company agrees it
will not:
(a) suspend, discontinue or xxxxx any payment required by this
Agreement; or
(b) fail to observe any of its other covenants or agreements in this
Agreement; or
19
(c) terminate this Agreement for any cause whatsoever including, without
limiting the generality of the foregoing, failure to acquire the Land
or complete construction of the Facility or acquisition and
installation of the Equipment, any defect in the title, design,
operations, merchantability, fitness or condition of the Project
Facility or any part thereof or in the suitability of the Project
Facility or any part thereof for the Company's purposes or needs,
failure of consideration, destruction of or damage to, condemnation
of title to or the use of all or any part of the Project Facility,
commercial frustration of purpose, any change in the tax or other
laws of the United States of America or of the State or any political
subdivision of either, or any failure of the Issuer to perform and
observe any agreement, whether expressed or implied, or any duty,
liability or obligation arising out of or in connection with this
Agreement.
Nothing contained in this Agreement shall be construed to release the
Issuer from the performance of any of the covenants or agreements on its part
contained in this Agreement and, in the event the Issuer shall fail to perform
or observe any such covenant or agreement, the Company may institute such
action against the Issuer as the Company may deem necessary to compel
performance (subject to Sections 12.4 and 12.5 hereof) of such covenant or
agreement.
Section 5.4. PREPAYMENTS. The Company may prepay all or any part of the
amounts required to be paid by it under Section 5.2 herein at any time, subject
to the provisions contained in the Loan Agreement.
Section 5.5. [Reserved].
Section 5.6. [Reserved].
Section 5.7. INTEREST RATES. The Company is hereby granted the right to
designate from time to time changes in the Interest Rate on the Bonds in the
manner and to the extent set forth in the Loan Agreement.
Section 5.8. RIGHTS AND OBLIGATIONS OF COMPANY UPON DISCHARGE OF LIEN OF
MORTGAGE. Subject to the provisions of the Mortgage, in the event that the
Bonds and all sums outstanding under this Agreement, the Loan Agreement and the
other Bond Documents shall have been paid in full, the Issuer shall request the
Company to do all acts and execute all documents as may be reasonably necessary
to discharge the lien of the Mortgage on the Project Facility, and the Company
shall perform such acts and execute such documents, and, at the request of the
Company, the Issuer shall also do all acts and execute all documents as may be
reasonably necessary to discharge the lien of the Mortgage on the Project
Facility.
20
ARTICLE VI
MAINTENANCE, TAXES AND INSURANCE
Section 6.1. COMPANY'S OBLIGATIONS TO MAINTAIN AND REPAIR.
(a) Except in an Event of Loss, and except to the extent impractical for
any period during construction of the Facility or during which the Company is
pursuing with due diligence the restoration of the Project Facility in
accordance with the Loan Agreement, the Company agrees that during the term of
this Agreement it will keep and maintain the Project Facility in good
condition, repair and working order in accordance with sound electric
generation practice, ordinary wear and tear excepted, at its own cost, and will
make or cause to be made from time to time all repairs thereto (including
external and structural repairs) and renewals and replacements thereto which
are necessary to maintain the Project Facility or any part thereof in good
working order.
(b) So long as title to the Project Facility shall be held by the Issuer,
the Company may, after providing the Issuer with prior written notice, make, at
its expense, such alterations of or additions to the Project Facility or any
part thereof from time to time as the Company in its discretion may determine
to be desirable for its uses and purposes, as permitted by the Loan Agreement;
provided, however, that (1) such alterations or additions are effected with due
diligence, in a good and workmanlike manner and in compliance with all
applicable legal requirements, (2) such alterations or additions are promptly
and fully paid for by the Company in accordance with the terms of the
applicable contract(s) therefor, and in a manner such that the Project Facility
shall at all times be free of any mortgage, Lien, encumbrance, security
interest or claim except for Loan Agreement Permitted Liens, (3) such
alterations or additions do not change the nature of the Project Facility so
that it does not constitute a "project" under the Act, (4) such alterations or
additions are performed in full compliance with the Loan Agreement, (5) the
provisions of Article 8 of the Environmental Conservation Law, Chapter 43-B of
the Consolidated Laws of New York, as amended, are satisfied with respect to
such alteration or addition, and (6) the Issuer is furnished with an agreement
by the Company reasonably satisfactory to the Issuer requiring the Company to
make payments in lieu of taxes with respect to such alteration or addition. Any
evidences of indebtedness of the Issuer issued in connection with any such
alterations or additions shall be in accordance with all policies and
requirements of the Issuer in effect at such time. All alterations of and
additions to the Project Facility shall constitute a part of the Project
Facility subject to this Agreement and the Mortgage, and the Company shall
deliver to the Issuer appropriate documents as may be necessary to convey title
to such property to the Issuer, free and clear of all liens and encumbrances
other than Loan Agreement Permitted Liens.
(c) Neither the Issuer nor the Company shall be under any obligation to
renew, repair or replace any inadequate,
21
obsolete, worn out, unsuitable, undesirable or unnecessary portions of the
Project Facility.
(d) The Issuer shall be under no obligation to replace, maintain or effect
repairs of the Project Facility or to furnish any utilities or services for the
Project Facility, and the Company hereby agrees to assume full responsibility
therefor.
Section 6.2. TAXES AND OTHER CHARGES.
(a) The Company will pay and discharge or cause to be paid and discharged
all taxes, payments in lieu of taxes, including the PILOT Payments (as defined
in the Saranac PILOT Agreement) assessments, governmental charges or levies and
all utility and other charges incurred in the operation, maintenance, use,
occupancy and upkeep of the Project Facility imposed upon it or in respect of
the Project Facility not later than the date payment of same is required
pursuant to the Loan Agreement and the Saranac PILOT Agreement as well as all
lawful claims which, if unpaid, might become a lien or charge upon such
property and assets or any part thereof, except such that are contested in good
faith by the Company in accordance with the requirements of the Loan Agreement
and the Saranac PILOT Agreement.
(b) It is recognized that under the provisions of the Act the Issuer is
required to pay no taxes or assessments upon any of the Property acquired by it
or under its jurisdiction, control or supervision or upon its activities. It is
not the intention, however, of the parties hereto that the Project Facility be
treated as exempt from real property taxation, and accordingly, the parties
have entered into the Saranac PILOT Agreement. Until the expiration of the
Saranac PILOT Agreement, the Company and the Issuer agree that the Company
shall make all payments due under the Saranac PILOT Agreement. In the event
that (i) the Project Facility would be subject to real property taxation if
owned by the Company but shall be deemed exempt from real property taxation due
to the involvement of the Issuer therewith, and (ii) the Saranac PILOT
Agreement is not entered into, or if entered into shall for any reason no
longer be in effect, the Issuer and the Company hereby agree that the Company,
or any subsequent user of the Project Facility under this Agreement, shall in
such event be required to make or cause to be made payments in lieu of taxes to
or for the benefit of the school district or school districts, city, town,
county, village and other political units wherein the Project Facility is
located having taxing powers (such political units are hereinafter collectively
referred to as the "Taxing Entities") in such amounts as would result from
taxes being levied on the Project Facility by the Taxing Entities if the
Project Facility were privately owned by the Company and not deemed owned by or
under the jurisdiction, control or supervision of the Issuer, but with
appropriate reductions similar to the tax exemptions and credits, if any, which
would be afforded to the Company if it were the owner of the Project Facility.
It is agreed that the Issuer, in cooperation with the Company, (w) shall
endeavor to cause the Project Facility to be valued for purposes of determining
the amounts due hereunder as if owned by the Company as aforesaid by
22
the appropriate officer or officers of any of the Taxing Entities as may from
time to time be charged with responsibility for making such valuations, (x)
shall endeavor to cause to be appropriately applied to the valuation or
valuations so determined the respective tax rate or rates of the Taxing
Entities that would be applicable to the Project Facility if so privately
owned, (y) shall endeavor to cause the appropriate officer or officers of the
Taxing Entities charged with the duty of levying and collecting such taxes to
submit to the Company, when the respective levies are made for purposes of such
taxes upon property privately owned as aforesaid, statements specifying the
amounts and due dates of such taxes which the Taxing Entities would receive if
such property were so privately owned by the Company and not deemed owned by or
under the jurisdiction, control or supervision of the Issuer, and (z) shall
file with the appropriate officer or officers any accounts or tax returns
furnished to the Issuer by the Company for the purpose of such filing. In the
event the Company shall fail to make or cause to be made any such payment in
lieu of taxes or taxes, the amount or amounts so in default shall continue as
an obligation of the Company until fully paid, and the Company hereby agrees to
pay or cause to be paid the same, together with interest thereon, at the same
rate per annum as provided for in the Saranac PILOT Agreement, or, if taxes, as
if such amounts were delinquent taxes.
Section 6.3. LIENS. The Company may create or permit to remain a Lien
against its interest in the Project Facility, provided the same constitutes a
Loan Agreement Permitted Lien; and provided further, however, that the Company
shall provide the Issuer with written notice of any such Lien within thirty
(30) days after the Company learns of such Lien.
Section 6.4. INSURANCE. (a) The Company will during the term of this
Agreement continuously insure, or cause to be insured, and pay, or cause to be
paid, all premiums relating thereto, the Project Facility in accordance with
requirements of the Loan Agreement, and, if no Loan Agreement is in effect, in
accordance with the customary standards of businesses of like size and type
(taking into account the policies and amounts required under the Loan
Agreement, which shall be considered customary as of the Closing Date),
including, but not limited to, title, required workers' compensation, adequate
public liability, personal injury or death, workmen's compensation as legally
required, builder's risk all risk, during the construction of the Project
Facility, and full cash replacement value casualty insurance, all policies with
adequate cancellation and alteration notice provisions in the reasonable
opinion of the Issuer. All insurance policies required under this Agreement
shall be carried with insurance companies qualified under the laws of the State
in financially sound companies selected by the Company and satisfactory to the
Issuer, and such policies shall provide at least thirty (30) days written
notice to the Company and the Issuer prior to cancellation, lapse, reduction in
policy limit or material change in coverage (except that, to the extent
customary, only ten (10) days written notice shall be required in the
circumstance of non-payment of premium). All claims on such insurance
regardless of amount may be adjusted by the Company with the insurers. The
proceeds of all insurance
23
policies for loss or damage to the Project Facility shall be payable to the
Issuer and the Company as their interests may appear (subject to the rights, if
any, of the Agent), provided that any such policy may be written or endorsed as
to make payments on all claims for losses payable directly to the Company. The
Issuer shall be a named insured under any public liability insurance policies.
The Net Proceeds of such liability insurance shall be applied toward
extinguishment or satisfaction of the liability with respect to which such
insurance proceeds may be paid. Notwithstanding the above in this Section 6.4,
so long as the Loan Agreement is in effect, the Company shall comply with the
terms of the Loan Agreement and the Security Deposit Agreement relating to
insurance coverage and the use of insurance proceeds.
(b) The Company shall require the Contractor, any replacement therefor,
and all Subcontractors to maintain all forms of insurance with respect to their
employees at the Project Facility required by law.
(c) THE ISSUER DOES NOT IN ANY WAY REPRESENT THAT THE INSURANCE SPECIFIED
HEREIN, WHETHER IN SCOPE OR IN LIMITS OF COVERAGE, IS ADEQUATE OR SUFFICIENT TO
PROTECT THE COMPANY'S BUSINESS OR INTERESTS.
(d) Certificates of insurance reasonably satisfactory in form and
substance to the Issuer to evidence all insurance required hereby shall be
delivered to the Issuer on or before the Closing Date. Prior to the expiration
of any such policy, the Company shall furnish to the Issuer evidence that the
policy has been renewed or replaced or is no longer required by this Agreement.
Section 6.5. REMODELING AND IMPROVEMENTS. The Company may remodel the
Project Facility or make substitutions, additions, modifications or
improvements thereto from time to time as it, in its discretion, deems
desirable, provided that any such remodeling, substitutions, additions,
modifications or improvements do not materially alter the character of the
Project Facility as an enterprise permitted by the Act or violate any
governmental permits of the Project Facility. The cost of such remodeling,
substitutions, additions, modifications or improvements shall be paid by the
Company.
Section 6.6. EQUIPMENT. The Company may from time to time substitute
machinery and equipment for any Equipment in accordance with the provisions of
the Loan Agreement, the Mortgage and the covenants contained in this Agreement
and the Loan Agreement. Any such substituted machinery and equipment shall
become a part of the Project Facility and be included under the terms of this
Agreement.
The Company may also sell, scrap, trade-in or otherwise dispose of, any
Equipment, without substitution therefor so long as the removal of the
Equipment to be purchased or otherwise disposed of will not materially alter
the character of the Project Facility as an enterprise permitted by the Act and
under the governmental permits required to construct or operate the Project
Facility.
24
Section 6.7. INSTALLATION OF COMPANY'S OWN MACHINERY AND EQUIPMENT. The
Company may, from time to time in its sole discretion and at its own expense,
install additional machinery, equipment and other tangible personal property in
the Facility and title thereto shall remain in the Company.
Section 6.8. ADVANCES BY ISSUER. In the event the Company shall fail:
(a) to keep the Project Facility in the condition as required by Section
6.1;
(b) to pay all taxes or their equivalent, assessments or other
governmental or utility charges as required by Section 6.2;
(c) to pay or cause to be satisfied and discharged any Liens filed or
established against the Project Facility as required by Section 6.3; or
(d) to maintain the insurance required by Section 6.4, and the Agent does
not make such payments on behalf of the Company, the Issuer may (but unless
satisfactorily indemnified shall be under no obligation to) take such action as
may be necessary to cure such failure after first giving 60 days notice in
writing to the Company and the Agent, including the advancement of amounts of
money, and all amounts so advanced therefor by the Issuer shall become an
additional obligation of the Company to the one making the advance, which
amounts the Company agrees to pay on demand.
ARTICLE VII
EMINENT DOMAIN AND DAMAGE AND DESTRUCTION
Section 7.1. PROVISIONS RESPECTING EMINENT DOMAIN. In case of any damage
to or destruction of all or any part of the Project Facility exceeding
$500,000, the Company shall give prompt written notice thereof to the Issuer.
In case of a taking or proposed taking of all or any part of the Project
Facility or any right therein by Eminent Domain, the party upon which notice of
such taking is served shall give prompt written notice to the other. Each such
notice shall describe generally the nature and extent of such damage,
destruction, taking, loss, proceedings or negotiations.
Section 7.2. DAMAGE AND DESTRUCTION. If the Project Facility, or any
material portion thereof, shall be damaged or destroyed by fire, flood,
windstorm or other casualty, or title to, or the temporary use of, the Project
Facility, or any portion thereof, shall have been taken by the power of Eminent
Domain, the Company shall cause, subject to the provisions of Section 7.3
herein and the provisions of the Loan Agreement, the Net Proceeds from
insurance or condemnation or an amount equal thereto to be used for the repair,
reconstruction, restoration or improvement of the Project Facility.
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Section 7.3. REPAIR OF THE PROJECT.
(a) Notwithstanding Sections 7.1 and 7.2 herein,
(i) the Issuer shall have no obligation to replace, repair, rebuild,
restore or relocate the Facility or the Equipment;
(ii) there shall be no abatement or reduction in the amounts payable by
the Company under this Agreement (whether or not the Facility or the
Equipment are replaced, repaired, rebuilt, restored or relocated); or
(iii) subject to the provisions in the Loan Agreement and except as
otherwise provided in subsections (f) or (g) of this Section 7.3, the
Company shall promptly replace, repair, rebuild, restore, or relocate
(within the County of Clinton) the Facility to substantially the same
condition and value as an operating entity with such changes,
alterations and modifications as may be desired by the Company and
approved by the Issuer (which approval shall not be unreasonably
withheld or delayed), provided that such changes, alterations or
modifications do not so change the nature of the Project Facility so
that it does not constitute a "project", as such term is defined in
the Act, or conform with its operating permits.
(b) Except in an Event of Loss (and as hereinafter otherwise provided),
the Company shall cause all Net Proceeds of insurance and of any award in any
condemnation or Eminent Domain proceeding to be paid to and held in accordance
with the Loan Agreement; provided, however, that following the termination of
the Loan Agreement, such Net Proceeds shall be held by a mutually agreeable
escrow agent to be used (subject to subparagraph (e) below) solely for the
repair, reconstruction, restoration or improvement of the Project Facility.
(c) Except in an Event of Loss, in the event such Net Proceeds are not
sufficient to pay in full the costs of such replacement, repair, rebuilding,
restoration or relocation, the Company shall nonetheless complete so much of
the work, and pay from its own moneys that portion of the costs thereof in
excess of such Net Proceeds, as shall be required in the judgment of an
independent architect to restore the Project Facility to an operating economic
unit capable of serving as a natural gas-fired cogeneration facility similar in
size to the original Project Facility.
(d) All such replacements, repairs, rebuilding, restoration and
relocations made pursuant to this Section 7.3,
26
whether or not requiring the expenditure of the Company's own money, shall
automatically become a part of the Project Facility as if the same were
specifically described herein.
(e) Any balance of such Net Proceeds remaining after payment of all the
costs of such replacement, repair, relocation, rebuilding or restoration shall
be used only as set forth in the Basic Documents, or, if the Basic Documents
shall no longer be in effect, such balance shall be paid over to the Company
for its purposes.
(f) In the event any condemnation or Eminent Domain award, or damage to
the Project Facility, exceeds $30,000,000 in value or amount, the Company shall
not be obligated to replace, repair, relocate, rebuild, or restore the Project
Facility, and the Net Proceeds of the insurance shall not be applied as
provided in subsections (a) through (e) of this Section 7.3, if the Company
shall notify the Issuer (in writing, promptly upon making its conclusion and
before notifying any other Person except for the Agent) that, in its sole
judgment, it does not deem it practical to so replace, repair, relocate,
rebuild or restore the Project Facility. If the Net Proceeds is less than the
amount necessary to prepay the Bonds in full, including accrued interest and
prepayment penalty, if any, there shall be no abatement or reduction in the
amount payable by the Company under this Agreement.
(g) If the entire amount of the Bonds, accrued interest thereon and
prepayment penalty, if any, and all other sums outstanding in connection with
the Bond Documents, have been fully paid, together with all other amounts due
hereunder, all such Net Proceeds, or the surplus thereof, shall be paid to the
Company for its purposes.
(h) The Company and the Issuer acknowledge that a mortgage and security
interest in the Net Proceeds of insurance carried pursuant to this Agreement
and the Net Proceeds of any condemnation or similar awards will be granted by
the Issuer and the Company to the Agent pursuant to the Collateral Security
Documents, and the Company consents thereto. Notwithstanding anything in this
Article VII to the contrary, while the Loan Agreement remains in effect, the
provisions of the Loan Agreement and the other Bond Documents, and not this
Article VII, shall govern all matters with respect to insurance and Eminent
Domain, including the applications of proceeds thereof.
(i) The Issuer hereby appoints the Company as its true and lawful agent,
and the Company hereby accepts such agency, to replace, repair, rebuild and
restore the Project Facility as provided in the Loan Agreement and in
accordance with all Applicable Laws, and in consideration of such acceptance
the Issuer hereby assigns to the Company all its right to receive payments from
the Net Proceeds of any insurance settlement or condemnation or similar award
for the payment or reimbursement of the cost of such replacement, repair,
rebuilding and restoration.
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ARTICLE VIII
SPECIAL COVENANTS
Section 8.1. ACCESS TO THE PROPERTY AND INSPECTION. The Issuer, the Agent,
and their respective agents and employees, shall have the right, at all
reasonable times during normal business hours upon the furnishing of reasonable
notice to the Company under the circumstances and upon compliance with the
Company's reasonable safety and confidentiality policies, to enter upon and
examine and inspect the Project Facility and to examine and copy the books and
records of the Company insofar as such books and records relate to the Project
Facility or the Bond Documents.
Section 8.2. AGREEMENT TO PROVIDE INFORMATION. The Company and the General
Partner of the Company agree to provide and certify or cause to be certified
such financial and other information concerning the Company, the Project
Facility and the General Partner of the Company, as the Issuer from time to
time reasonably considers necessary or appropriate, including, but not limited
to, (i) such information as to enable Issuer to make any reports required by
any law, statute, rule or governmental regulation, (ii) all information
relating to the compliance of the Company with all environmental laws,
statutes, rules and regulations of all applicable Governmental Authorities, and
(iii) all pleading and other material information relating to any material
litigation concerning the Company, its general partner or the Project Facility.
Section 8.3. FURTHER ASSURANCES AND CORRECTIVE INSTRUMENTS.
(a) Subject to the provisions of the Loan Agreement, the Issuer and the
Company agree that they will, from time to time, execute, acknowledge and
deliver, or cause to be executed, acknowledged and delivered, such supplements
and amendments hereto and such further instruments as may reasonably be
required for carrying out the intention or facilitating the performance of this
Agreement.
(b) The Issuer (at the Company's direction and expense) shall cause this
Agreement to be kept recorded and filed in such manner and in such places as
may be required by law to fully preserve and protect the security of the
Lenders and to perfect the security interest created by the Loan Agreement.
Section 8.4. RECORDING AND FILING; OTHER INSTRUMENTS.
(a) The Company covenants that it will cause continuation statements to be
filed as required by law in order fully to preserve and to protect the rights
of the Issuer in the assignment of certain rights of the Issuer under this
Agreement and otherwise under the Mortgage. The Company covenants that it will
cause a certificate, with filings attached, to be delivered to the Issuer not
earlier than 60 nor later than 30 days prior to each anniversary date occurring
at five-year intervals after the
28
issuance of the Bonds to the effect that all Financing Statements, notices and
other instruments required by applicable law, including this Agreement, have
been recorded or filed or re-recorded or re-filed in such manner and in such
places required by law in order fully to preserve and to protect the rights of
the Issuer under this Agreement and otherwise under the Mortgage.
(b) The Issuer shall, at the request of the Company, file and re-file and
record and re-record or shall cause to be filed and re-filed and recorded and
re-recorded all instruments, including, without limitation, the Mortgage,
required to be filed and re-filed and recorded or re-recorded and shall
continue or cause to be continued the liens of such instruments for so long as
this Agreement shall remain in effect.
Section 8.5. [Reserved]
Section 8.6. INDEMNITY AGAINST CLAIMS. The Company will pay and discharge
and will indemnify and hold harmless the Issuer from any taxes, assessments,
impositions, claims, reasonable fees and expenses of attorneys and consultants
incurred by the Issuer, and other charges in respect of the Project Facility or
the issuance of the Bonds. If any claim of any thereof is asserted, or any such
lien or charge upon payments, or any such taxes, assessments, impositions or
other charges, are sought to be imposed, the Issuer will give prompt written
notice to the Company; provided, however, that the failure to provide such
notice will not relieve the Company of the Company's obligations and liability
under this Section 8.6 and will not give rise to any claim against or liability
of the Issuer. The Company shall have the right to assume the defense thereof,
with counsel reasonably acceptable to the person on behalf of which the Company
undertakes a defense, with full power to litigate, compromise or settle the
same in its sole discretion. The Company covenants and agrees to pay or to
reimburse the Issuer, its members, attorneys or consultants for all reasonable
costs incurred in connection with any investigation or defense relating to the
Project Facility.
Section 8.7. RELEASE AND INDEMNIFICATION. The Company shall at all times
protect, indemnify and hold the Issuer, the members of the Issuer, and the
attorneys, agents and employees of the Issuer harmless against any and all
liability, losses, damages, costs, expenses, taxes, causes of action, suits,
claims, demands and judgments of any nature arising or in connection with the
development, Acquisition or operation of the Project Facility or the financing
of the Project Facility, including, without limitation, all claims or liability
resulting from entering into or performing in accordance with or in connection
with the Bond Documents or Basic Documents or any loss or damage to property or
any injury to or death of any person that may be occasioned by any cause
whatsoever pertaining to the Project Facility or the use thereof, including
without limitation any lease thereof or assignment of its interest in this
Agreement, such indemnification to include reasonable expenses and attorneys'
fees incurred by the Issuer, its directors, members, officers, attorneys,
agents and employees in connection therewith; provided, that such indemnity
29
shall be effective only to the extent of any loss that may be sustained by the
Issuer, its directors, members, officers, attorneys, agents and employees in
excess of the Net Proceeds received by it or them from any insurance carried
with respect to such loss, if applicable, and provided, further that the
benefits of this Section 8.7 shall not inure to any person other than the
Issuer, its directors, members, officers, attorneys, agents and employees; and
provided, further that such loss, damage, death, injury, claims, demands or
causes shall not have resulted from the gross negligence or intentional or
willful misconduct of, the Issuer or such directors, members, officers,
attorneys, agents (other than the Company or any of its subagents) or
employees.
Section 8.8. COMPLIANCE WITH LAWS. The Company agrees to comply in all
material respects with all applicable zoning, planning, building, environmental
and other statutes, laws, ordinances, orders, rules, requirements and
regulations of all Governmental Authorities having jurisdiction of the Project
Facility and to operate the Project Facility as a "project" under the Enabling
Act.
Section 8.9. [Reserved]
Section 8.10. Reserved]
Section 8.11. [Reserved]
Section 8.12. [Reserved]
Section 8.13. MAINTENANCE OF EXISTENCE.
(a) So long as the Loan Agreement is in effect the Company agrees that it
will maintain its existence as a limited partnership, will not dissolve or
otherwise dispose of all or substantially all of its assets (except in a
foreclosure action on the Mortgage), will not consolidate with or merge into
another entity or permit one or more other entities to consolidate with or
merge into it, sell any interests in the Limited Partnership other than to the
Tomen Limited Partners or the GE Capital Limited Partner, or admit any
additional General Partner, except with the consent of the Agent in accordance
with the provisions of the Loan Agreement and reasonable advance notice to the
Issuer;
(b) If the Loan Agreement is not in effect, any general partner of the
Company as of the termination of the Loan Agreement shall remain a general
partner of the Company (and shall not sell its interests as general partner
except in accordance with the agreement of limited partnership) and the Company
agrees that it will continue to be a limited partnership either organized under
the laws of or duly qualified to do business as a foreign limited partnership
in the State, will maintain its existence, will not dissolve or otherwise
dispose of all or substantially all of its assets and will not consolidate with
or merge into another entity or permit one or more entities to consolidate with
or merge into it except as permitted under its agreement of limited
partnership; provided, that the Company and its general partner may, without
30
violating the foregoing, consolidate with or merge into another entity, or
permit one or more entities to consolidate with or merge into it, or transfer
all or substantially all of its assets to another such entity (and thereafter
dissolve or not dissolve, as the Company may elect) if the entity surviving
such merger or resulting from such consolidation, or the entity to which all or
substantially all of the assets of the Company are transferred, as the case may
be:
(i) is a limited partnership, general partnership or corporation
organized under the laws of the United States of America, or any state,
district or territory thereof, and qualified to do business in the State;
(ii) shall expressly in writing assume all of the obligations of the
Company contained in this Agreement;
(iii) has a consolidated tangible net worth (after giving effect to such
consolidation, merger or transfer) of not less than the consolidated
tangible net worth of the Company and its consolidated subsidiaries
immediately prior to such consolidation, merger or transfer; and
(iv) provided that no Event of Default has occurred and is continuing
hereunder.
(d) The foregoing limitations on transfer of assets shall not apply from
and after any foreclosure of the Project Facility by the Agent or its nominee
or subsidiary.
The term "consolidated tangible net worth," as used in this Section 8.13,
shall mean the difference obtained by subtracting total consolidated
liabilities (not including as a liability any capital or surplus item) from
total consolidated tangible assets of the Company and all of its consolidated
subsidiaries, computed in accordance with generally accepted accounting
principles. Prior to any such consolidation, merger or transfer the Issuer
shall be furnished a certificate from the chief financial officer of the
Company or his deputy stating that in the opinion of such officer none of the
covenants in this Agreement will be violated as a result of said consolidation,
merger or transfer.
Section 8.14. GRANT OF EASEMENTS; LIENS.
(a) If no Event of Default shall have occurred and be continuing, the
Company may:
(i) at any time or times grant easements, licenses, rights-of-way
(including the dedication of public highways) and other rights or
privileges in the nature of easements with respect to any part of the
Project Facility with or without consideration, (if with consideration, the
proceeds shall be retained by the Company); or
(ii) secure the release of existing easements, licenses, rights-of-way
and other rights and privileges.
31
(b) The Company shall not permit or create or suffer to be permitted or
created any Lien, except for Loan Agreement Permitted Liens, upon the Project
Facility or any part thereof.
Section 8.15. NO WARRANTY OF CONDITION OR SUITABILITY BY ISSUER. The
Company recognizes that the Issuer does not deal in goods of the kind
comprising components of the Project Facility or otherwise hold itself out as
having knowledge or skill peculiar to the practices or goods involved in the
Project Facility, and that the Issuer is not one to whom such knowledge or
skill may be attributed by its employment of an agent or broker or other
intermediary who by his occupation holds himself out as having such knowledge
or skill. The Company further recognizes that since the components of the
Project Facility have been and are to be designated and selected by the
Company, THE ISSUER HAS NOT MADE AN INSPECTION OF THE PROJECT FACILITY OR OF
ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION THEREOF, AND, EXCEPT AS
OTHERWISE PROVIDED HEREIN, THE ISSUER MAKES NO WARRANTY OR REPRESENTATION,
EXPRESS OR IMPLIED OR OTHERWISE, WITH RESPECT TO THE SAME OR TO THE LOCATION,
USE, DESCRIPTION, DESIGN, MERCHANTABILITY, FITNESS FOR USE FOR ANY PARTICULAR
PURPOSE, CONDITION OR DURABILITY THEREOF, TO THE QUALITY OF THE MATERIAL OR
WORKMANSHIP THEREIN, IT BEING AGREED THAT ALL RISKS INCIDENT THERETO ARE TO BE
BORNE BY THE COMPANY. IN THE EVENT OF ANY DEFECT OR DEFICIENCY OF ANY NATURE IN
THE PROJECT FACILITY OR ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION
THEREOF, WHETHER PATENT OR LATENT, THE ISSUER SHALL HAVE NO RESPONSIBILITY OR
LIABILITY WITH RESPECT THERETO. THE PROVISIONS OF THIS SECTION HAVE BEEN
NEGOTIATED AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY
WARRANTIES OR REPRESENTATIONS BY THE ISSUER, EXPRESS OR IMPLIED (TO THE EXTENT
PERMITTED BY APPLICABLE LAW), WITH RESPECT TO THE PROJECT FACILITY OR ANY
FIXTURE OR OTHER ITEM CONSTITUTING A PORTION THEREOF, WHETHER ARISING PURSUANT
TO THE U.C.C. OR ANOTHER LAW NOW OR HEREAFTER IN EFFECT OR OTHERWISE.
Section 8.16. PERMITTED CONTESTS. The Company may, at its expense and in
its name and behalf or in the name and behalf of the Issuer, in good faith
contest any:
(a) taxes, assessments and other charges referred to in Section 6.2;
(b) lien, encumbrance or charge referred to in Section 6.3; or
(c) regulation or other requirement referred to in Section 8.8. In the
event of such contest, the Company may permit said taxes, assessments or other
charges so contested to remain unpaid or such lien, encumbrance or charge to
remain unsatisfied and undischarged during the period of such contest and any
appeal therefrom. The Issuer shall cooperate fully with the Company in any such
contest, except where the Issuer is an adverse party to the Company.
Each such contest shall be promptly prosecuted to a final conclusion. No
such contest shall subject the Issuer to the risk
32
of any material civil liability (other than the charge being contested) or any
criminal liability, and the Company shall give such reasonable security to the
Issuer as may be demanded by the Issuer to insure compliance with the foregoing
provisions of this Section. The foregoing shall not constitute a waiver by the
Issuer of any civil or criminal remedies otherwise available to the Issuer
against the Company.
Section 8.17. PROMOTION OF EMPLOYMENT. The Company, recognizing the intent
of the Act to provide employment, agrees during the term of this Agreement to
exercise good faith to maintain and operate or cause to be maintained and
operated an enterprise permitted by the Act and thereby to provide employment
in such operations not inconsistent with the best interest of the Company and
the Issuer in achieving the purpose set forth in the Act; provided, however,
that the Company shall not be deemed guilty or chargeable with any breach of
any agreement contained in this Section 8.17 unless and until the Company has
failed for a continuous period of one year (strikes, war, acts of God, fire,
acts of government and other casualties not under Company's control excepted)
to comply with the provisions of this Section.
Section 8.18. NOTICE AND CERTIFICATES TO ISSUER. The Company hereby agrees
to provide the Issuer with the following:
(a) On or before January 1 and July 1 of each year during which any of the
Bonds are outstanding, a certificate of an Authorized Representative that: (i)
all payments required under this Agreement have been made, and (ii) any
applicable third party credit support will continue in full force during the
succeeding twelve months, or explaining why not;
(b) Within one hundred twenty (120) days of the end of the fiscal year of
the Company, (i) a certificate of the Company to the effect that all payments
have been made under this Agreement and that, to the best of its knowledge,
there exists no Event of Default or unmatured default, and (ii) the audited
annual financial report of the Company;
(c) Upon knowledge of an Event of Default under this Agreement, notice of
such Event of Default, such notice to include a description of the nature of
such event and what steps are being taken to remedy such Event of Default;
(d) At the time of filing the certificate referred to in subparagraph (a)
above, a certificate, either stating all the steps, actions and proceedings to
be taken which are reasonably necessary to maintain in force in connection with
the Project Facility, or that no such steps, actions or proceedings are
necessary to maintain such security. Such certificate shall also describe the
recording, filing, re-recording and re-filing of the Collateral Security
Documents and the execution and filing of any financing statements and
continuation statements that will be required to maintain the lien and priority
of any security interest in personal property granted in connection with the
Project Facility for the next year.
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ARTICLE IX
ASSIGNMENT, LEASE AND SALE
Section 9.1. RESTRICTIONS ON TRANSFER OF ISSUER'S RIGHTS. The Issuer
agrees that, except for the assignment of its rights as contemplated under this
Agreement, it will not during the term of this Agreement sell, assign, transfer
or convey its interests in this Agreement except (i) as provided in Section
5.1, Section 9.2 and Article X below, (ii) with the consent of the Company, and
(iii) if the Loan Agreement is in effect, with the consent of the Agent.
Section 9.2. MORTGAGING BY THE COMPANY AND THE ISSUER.
(a) The Company and the Issuer shall mortgage to the Agent their
respective rights, titles and interests in and to the Project Facility to
secure the Bonds as more particularly set forth in the Loan Agreement and the
Mortgage.
(b) If the Agent commences an action to foreclose the Mortgage (or any
mortgage included in the definition thereof), the Agent may, at its option,
name as defendants in such foreclosure action either (i) the Company or (ii)
both the Company and the Issuer. If both the Company and the Issuer are named
as defendants in such foreclosure action, (x) this Agreement shall terminate on
the date that title to the Project Facility ceases to be held by the Issuer
pursuant to such foreclosure action and (y) Issuer shall join in any referee's
deed or similar conveyance necessary or advisable in order to convey Issuer's
right, title and interest in and to the Project Facility to the purchaser at
the foreclosure sale in such foreclosure action; provided, however, that prior
to naming the Issuer as a defendant, the Agent shall offer to enter into an
agreement with the Taxing Entities (as defined in the Saranac PILOT Agreement)
preserving the substance of the Saranac PILOT Agreement. If the Issuer is not
named in such foreclosure action, this Agreement shall remain in effect and,
upon divestiture of the Company's vendee's interest hereunder pursuant to such
foreclosure action, the Issuer shall recognize and attorn to the entity
succeeding to the Company's vendee's interest at the conclusion of such
foreclosure action; provided, however, that all amounts owned to the Issuer
under this Agreement shall have been paid as provided in Section 10.8.
(c) Except as provided in subsection (a) above, Section 9.3 below, or as
permitted by the Loan Agreement, neither the Company nor the Issuer shall
mortgage, pledge or assign their respective rights, titles or interests in and
to the Project Facility or any portion thereof.
Section 9.3. SALE OR LEASE OF THE PROJECT FACILITY. The Company may sell
or lease the Project Facility or any part thereof in accordance with the
provisions of the Loan Agreement, provided that such sale or lease shall not
release the Company of any of its obligations under this Agreement, and the
Company shall remain as
34
fully bound as though no sale or lease had been made. Performance by any buyer
or lessee shall be considered as performance by the Company; provided, however,
that the Company may assign this Agreement by a written assignment agreement,
and be thereby relieved of further obligation hereunder in connection with a
transaction involving merger, consolidation or transfer as permitted under
Section 8.13, provided
(a) the requirements thereof are met; and
(b) the party to which such assignment is made is the entity surviving
such merger or resulting from such consolidation or is the entity to which all
or substantially all of the assets of the Company is transferred, and such
party shall execute an assumption agreement having the effect of not altering
the material terms of this Agreement and the obligations of such assignee to
fulfill them.
The Company shall, within ten days after the delivery of the requisite
agreements and approvals, furnish or cause to be furnished to the Issuer a true
and complete copy of each such agreement of sale or lease or assignment and
assumption of assignment.
ARTICLE X
EVENTS OF DEFAULT AND REMEDIES
Section 10.1. EVENTS OF DEFAULT DEFINED.
(a) The term "Event of Default" as used herein shall mean any one or more
of the following events;
(i) (x) Failure by the Company to make any payments required to be paid
pursuant to Section 5.2(b) and (c) hereof; provided, any such failure
remains uncured for a period of twenty (20) days following written notice
of same to the Company, and (y) Failure by the Company to make any payments
under Section 5.2(a) hereof, which failure has led the Agent or its nominee
or subsidiary to enforce material remedies against the Company;
(ii) The occurrence and continuance of an Event of Default (as defined in
the Saranac PILOT Agreement or North Country PILOT Agreement, as the case
may be) beyond the expiration of any applicable notice and cure period
shall have occurred and be continuing under the Saranac PILOT Agreement or
the North Country PILOT Agreement;
(iii) From and after the date that the Loan Agreement shall no longer be
in effect, any representation by or on behalf of the Company contained in
this Agreement or in any instrument furnished in compliance with or in
reference to this Agreement proves
35
false or misleading in any material respect as of the date of the making or
furnishing thereof and has a material adverse effect upon the Project
Facility in the reasonable opinion of the Company;
(iv) Failure by the Company to observe or perform any of its other
covenants, conditions, payments or agreements under this Agreement for a
period of 30 days after written notice, specifying such failure and
requesting that it be remedied, is given to the Company by the Issuer
(unless such notice is not required due to actual knowledge of such failure
by the Company); provided, that such period shall be extended for such
period as the Company is diligently proceeding to cure such default and
such default is susceptible of cure;
(v) From and after the date that the Loan Agreement shall no longer be in
effect, the Company shall (i) apply for or consent to the appointment of,
or the taking of possession by, a receiver, custodian, assignee,
sequestrator, trustee, liquidator or similar official of the Company or of
all or a substantial part of its property, (ii) admit in writing its
inability, or be generally unable, to pay its debts as such debts become
due, (iii) make a general assignment for the benefit of its creditors, (iv)
commence a voluntary case under the Federal Bankruptcy Code (as now or
hereafter in effect), (v) file a petition seeking to take advantage of any
other federal or state law relating to bankruptcy, insolvency,
reorganization, arrangement, winding-up or composition or adjustment of
debts, (vi) fail to controvert in a timely or appropriate manner, or
acquiesce in writing to, any petition filed against the Company in an
involuntary case under said Federal Bankruptcy Code, or (vii) take any
corporate action for the purpose of effecting any of the foregoing; unless
in any event any such petition or case is dismissed or stayed within 90
days of filing;
(vi) From and after the date that the Loan Agreement shall no longer be
in effect, a proceeding or case shall be commenced, without the application
or consent of the Company, in any court of competent jurisdiction, seeking
(i) the liquidation, reorganization, arrangement, dissolution, winding-up
or composition or adjustment of debts of the Company, (ii) the appointment
of a trustee, receiver, custodian, assignee, sequestrator, liquidator or
similar official of the Company or of all or any substantial part of its
assets, or (iii) similar relief in respect of the Company under any law
relating to bankruptcy, insolvency, reorganization, arrangement, winding-up
or composition or adjustment of debts and such proceeding or case shall
continue undismissed, or an order, judgment or decree approving or ordering
any of the foregoing shall be entered and continue unstayed and in effect,
for a period
36
of 90 days from the commencement of such proceeding or case or the date
of such order, judgment or decree, or an order for relief against the
Company shall be entered in an involuntary case under said Federal
Bankruptcy Code;
(vii) If any insurance policy required to be maintained pursuant to the
Loan Agreement or this Agreement shall be canceled or terminated or shall
lapse and shall not have been replaced prior to the effective date of such
cancellation, termination or lapse by a policy covering the same matters
and that complies with the requisite criteria herein;
(viii) The occurrence and continuance of an Event of Default (as defined
in the Loan Agreement) under the Loan Agreement; provided, any such Event
of Default has led the Agent or its nominee or subsidiary to enforce
material remedies against the Company;
(ix) the Company shall fail to operate the Project Facility as a
"project" under the Enabling Act or shall fail to comply with any other
covenant contained herein (except for the covenants listed in subparagraph
(x) below), within thirty (30) days of written notice by the Issuer to the
Company; provided that such period shall be extended for such additional
period as the Company is diligently proceeding to cure such default and
such default is susceptible to cure; or
(x) The Company shall violate Sections 8.13 or 9.3 hereinabove.
(b) Notwithstanding the provisions of subparagraph (a) above, and subject
to the provisions of the Loan Agreement, in the event that the performance by
either party hereto of its obligations under this Agreement is delayed due to
the following events of force majeure: (i) an act of God, or (ii) an act of
nature, or (iii) the imposition of any restrictions by any governmental
authority, or (iv) war, military operations or national emergencies, or (v)
weather, or (vi) any other cause beyond the control of the parties, then and in
that event all time limitations and performance dates herein shall be
appropriately extended by the parties, upon notice to the other party hereto by
the party whose performances is delayed of such condition causing the delay,
for a period equal to the number of days that the performance of said
obligations is delayed; provided, that in no event shall such delay be deemed
to extend the time for performance by said party for more than ninety (90) days
in the aggregate. The extension of such time limitations and performance dates
for such period pursuant to this subsection (b) shall not be deemed an Event of
Default under this Section 10.1. Notwithstanding anything to the contrary in
this subsection (b), any event of force majeure shall not excuse, delay or in
any way diminish the obligations of the Company to make the payments required
by Sections 5.2, 5.4 and 6.2 herein and observe the covenants, obtain the
insurance policies and provide the indemnity as required by this Agreement.
37
Section 10.2. REMEDIES ON DEFAULT. Upon the occurrence and during the
continuance of an Event of Default under this Agreement, the Issuer may take
any one or more of the following remedial steps:
(a) By written notice declare all payments pursuant to Section 5.2(a)
hereof and all other amounts payable hereunder immediately due and payable,
whereupon the same shall become immediately due and payable without
presentment, demand, protest or any other notice whatsoever, all of which are
hereby expressly waived by the Company; provided, however, that if the Loan
Agreement is still in effect, the Issuer shall receive the Agent's prior
written consent;
(b) In the event any of the Bonds shall at the time be unpaid, have access
to and inspect, examine and make copies of books and records and any and all
accounts, data and income tax and other tax returns of the Company only,
however, insofar as they relate to the Project Facility;
(c) Take whatever other action at law or in equity may appear necessary or
desirable to collect the amounts payable pursuant hereto then due and
thereafter to become due or to enforce the performance and observance of any
obligation, agreement or covenant of the Company under this Agreement or to
secure possession of the Project Facility; provided, however, that the Agent
provides its prior written consent, except that no such consent is necessary or
required with respect to enforcement of Sections 5.2(b) and (c), 5.4 or 6.2
hereinabove;
(d) Take possession of and operate the Project Facility upon thirty (30)
days notice to the Company, with the prior written consent of the Agent; or
(e) Terminate this Agreement and convey the Project Facility to the
Company; provided, the Issuer shall give ninety (90) days notice to the Agent
prior to such conveyance.
In the enforcement of the remedies provided in this Section 10.2, the
Issuer may treat all reasonable expenses of enforcement, including, without
limitation, legal, accounting and advertising fees and expenses, as additional
amounts payable by the Company then due and owing.
No action taken pursuant to this Section 10.2 (including repossession of
the Project Facility) shall relieve the Company from its obligation to make all
payments required by Section 5 of this Agreement.
Section 10.3. APPLICATION OF AMOUNTS REALIZED IN ENFORCEMENT OF REMEDIES.
Except as otherwise paid to the Agent in accordance with the terms of the Loan
Agreement, any amounts collected pursuant to action taken under Section 10.2
shall be paid to the Issuer.
38
Section 10.4. NO REMEDY EXCLUSIVE. No remedy herein conferred upon or reserved
to the Issuer is intended to be exclusive of any other available remedy or
remedies, but each and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Agreement or now or hereafter
existing at law or in equity or by statute. No delay or omission to exercise
any right or power upon and during the continuance of an Event of Default under
this Agreement shall impair any such right or power or shall be construed to be
a waiver thereof, but any such right and power may be exercised from time to
time and as often as may be deemed expedient provided such Event of Default is
then continuing.
Section 10.5. AGREEMENT TO PAY ATTORNEYS' FEES AND EXPENSES. Upon the
occurrence and during the continuance of an Event of Default under this
Agreement, if the Issuer employs attorneys or incurs other expenses for the
collection of amounts payable hereunder or for the enforcement of the
performance or observance of any covenants or agreements on the part of the
Company herein contained, whether or not suit is commenced, the Company agrees
that it will on demand therefor pay to the Issuer the reasonable fees of such
attorneys and such other reasonable expenses so incurred by the Issuer.
Section 10.6. ISSUER AND COMPANY TO GIVE NOTICE OF DEFAULT. The Issuer and
the Company severally covenant that they will, at the expense of the Company,
promptly give to the Agent, and to each other, written notice of any Event of
Default under this Agreement of which they shall have actual knowledge or
written notice, but the Issuer shall not be liable for failing to give such
notice.
Section 10.7. NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In the event
that any agreement contained herein should be breached by either party and
thereafter be waived by the other party, such waiver shall be limited to the
particular breach so waived and shall not be deemed to waive any other breach
hereunder.
Section 10.8. NOTICE TO AGENT. Before exercising any of its remedies
pursuant to Section 10.2 hereof, the Issuer shall give to the Agent a notice
that a specified Event of Default hereunder remains unremedied and that the
Issuer is entitled to exercise such remedies, and the Agent shall have the
right to remedy any Event of Default within a period of ninety (90) days after
the service of such notice and the Issuer will postpone the exercise of any of
its remedies provided for in Section 10.2 hereof for such period or periods of
time as may be necessary for the Agent, with the exercise of due diligence, to
extinguish the Company's interest under this Agreement and to perform or cause
to be performed all of the covenants and agreements to be performed by the
Company as aforesaid. Upon such extinguishment of the Company's interest under
this Agreement and such performance by the Agent, the Issuer's right to
exercise any remedies provided for in Section 10.2 hereof, based upon the
occurrence, existence and continuance of any Event of Default hereunder which
cannot with the exercise of due diligence be remedied by the Agent, shall be,
and be deemed to be, waived. Nothing herein contained shall be deemed to
require
39
the Agent to continue with any foreclosure or other proceedings or, in the
event that the Agent shall acquire possession of the Project Facility, to
continue such possession, if the Event of Default in respect of which the
Issuer shall have given such notice shall have been remedied to the
satisfaction of the Agent and possession of the Project Facility shall have
been restored to the Company.
Nothing herein contained shall affect the right of the Issuer, upon the
occurrence (and during the continuance) of any Event of Default by Agent
hereunder arising after the Agent obtains possession of the Project Facility,
to exercise any right or remedy herein reserved to the Issuer.
ARTICLE XI
[RESERVED]
ARTICLE XII
MISCELLANEOUS
Section 12.1. LIMITATIONS WITH RESPECT TO OBLIGATIONS OF THE COMPANY.
Anything contained herein to the contrary notwithstanding, the Issuer hereby
agrees that there shall be no recourse against the Company or any partner or
affiliate of the Company nor any shareholder, partner, officer, director, agent
or representative of any thereof for any liability to the Issuer arising in
connection with any breach or default under this Agreement by the Company
except to the extent the same is enforced against the rights, title and
interest of the Company in the Project Facility, and the Issuer shall look
solely to the rights, title and interest of the Company relating to the Project
Facility in enforcing its rights against the Company under and in connection
with this Agreement; provided, that (a) the foregoing provisions of this
Section shall not constitute a waiver, release or discharge of any of the
obligations arising under, or of any of the terms, covenants, conditions, or
provisions of, this Agreement, but the same shall continue until fully paid,
discharged, observed, or performed, (b) the foregoing provisions of this
Section shall not limit or restrict the right of the Issuer to name the Company
or any other Person as a defendant in any action or suit for a judicial
foreclosure or for the exercise of any other remedy under or with respect to
this Agreement, or for injunction or specific performance, and (c) the Issuer
is not waiving any right it may have against any such partner, shareholder,
officer, director, agent or representative of the Company or any partner or
affiliate thereof arising from any misrepresentation by, or tort by, such
Person. In addition, nothing contained in this Section shall limit in any way
the ability of the Issuer from enforcing its rights or the rights of the
Company against any Person other than the Company under this Agreement.
Section 12.2. SUBORDINATION TO MORTGAGES. This Agreement and all rights of
the Issuer and the Company hereunder are and shall be
40
subject and subordinate to the lien of the Mortgage and the Saranac PILOT
Mortgage. The subordination of the lien of this Agreement to the lien of the
Mortgage and the Saranac PILOT Mortgage shall be automatic, without the
execution of any further subordination agreements by the Company. Nonetheless,
if the Agent requires any further written subordination agreements, the Company
and the Issuer agree to execute, acknowledge and deliver the same.
Section 12.3. NOTICES. Except as otherwise provided herein, it shall be
sufficient service or giving of any notice, request, complaint, demand or other
paper if the same shall be duly mailed by registered or certified mail, postage
prepaid, addressed as set forth below, or by telecopy or courier with written
evidence of receipt by the addressor, to the Issuer, the Company, the Agent or
to any other Person set forth therein. The Issuer, the Company and the Agent by
notice given hereunder may designate any different addresses to which
subsequent notices, certificates or other communications shall be sent. A
duplicate copy of each notice, certificate or other communication given
hereunder by one party to another shall also be given to each of the other
parties listed herein.
To the Issuer: County of Clinton Industrial Development Agency
0 Xxxxxxxxxx Xxxxxxxxx Xxxx
Xxxxxxxxxxx, Xxx Xxxx 00000
Attention: Chairman
With a copy to: Xxxxx & Xxxxx
00 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
To the Company: Saranac Power Partners, L.P.
Five Post Oak Park, Suite 1400
Xxxxxxx, XX 00000
Attention: President
To the Agent: General Electric Capital Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Attention: Vice President,
Energy Project Operations
Section 12.4. ISSUER, DIRECTORS, MEMBERS, ATTORNEYS, OFFICERS, EMPLOYEES
AND AGENTS OF ISSUER NOT LIABLE. No recourse shall be had for the enforcement
of any obligation, promise or agreement of the Issuer contained herein or
contemplated hereby or in or contemplated by the other Bond Documents or Basic
Documents or for any claim based hereon or thereon or otherwise in respect
hereof or thereof against any director, officer, agent (other than the
Company), attorney or employee, as such, in his individual capacity, past,
present or future, of the Issuer or of any successor entity, either directly or
through the Issuer or any successor entity whether by virtue of any
constitutional provision,
41
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise. No personal liability whatsoever shall attach to, or be incurred by,
any director, officer, agent (other than the Company), attorney or employee as
such, past, present or future, of the Issuer or any successor entity, either
directly or through the Issuer or any successor entity, under or by reason of
any of the obligations, promises or agreements entered into between the Issuer
and the Company, whether herein contained or to be implied herefrom as being
supplemental hereto; and all personal liability of that character against every
such director, officer, agent (other than the Company), attorney and employee
is, by the execution of this Agreement and as a condition of, and as part of
the consideration for, the execution of this Agreement, expressly waived and
released.
Section 12.5. SPECIAL OBLIGATION. Notwithstanding any representation or
statement to the contrary contained herein or in any of the other Bond
Documents or Basic Documents, the obligations and agreements of the Issuer
contained herein or contemplated hereby and in or contemplated by any other
Bond Document or Basic Document, and in any other therewith, and any other
instrument or document supplemental thereto shall be deemed the obligations and
agreements of the Issuer, and not of any member, officer, agent (other than the
Company) or employee of the Issuer in his individual capacity, and the members,
officers, agents (other than the Company) and employees shall not be liable
personally hereof or thereon or be subject to any personal liability or
accountability based upon or in respect hereof or thereof or of any transaction
contemplated hereby or thereby. The obligations and agreements of the Issuer
contained herein shall not constitute or give rise to an obligation of the
State or County of Clinton, New York and neither the State nor County of
Clinton New York shall be liable thereon, and further, such obligations and
agreements shall not constitute or give rise to a general obligation of the
Issuer, but rather shall constitute limited obligations of the Issuer payable
solely from the revenues of the Issuer derived and to be derived from the sale
or other disposition of the Project Facility (except for revenues derived by
the Issuer with respect to the Unassigned Rights). The Issuer shall not be
obligated to take any action pursuant to any provision hereof and no order or
decree of specific performance with respect to any of the obligations of the
Issuer hereunder shall be sought or enforced against the Issuer unless (1) the
party seeking such order or decree shall first have requested the Issuer in
writing to take the action sought in such order or decree of specific
performance, and 10 days shall have elapsed from the date of receipt of such
request, and the Issuer shall have refused to comply with such request (or if
compliance therewith would reasonably be expected to take longer than 10 days,
if the Issuer shall have failed to institute and diligently pursue action to
cause compliance with such request) or failed to respond within such notice
period, and (2) if the Issuer refused to comply with such request and the
Issuer's refusal to comply is based on its reasonable expectation that it will
incur fees and expenses, the party seeking such order or decree shall have
placed in an account with the Issuer an amount or undertaking sufficient to
cover such reasonable fees and expenses, and (3) if the Issuer refuses to
42
comply with such request and the Issuer's refusal to comply is based on its
reasonable expectation that it or any of its members, officers, agents (other
than the Company) or employees shall be subject to potential liability, the
party seeking such order or decree shall (a) agree to indemnify and hold
harmless the Issuer and its members, officers, agents (other than the Company)
and employees against any liability incurred as a result of its compliance with
such demand and (b) if requested by the Issuer shall furnish to the Issuer
satisfactory security to protect the Issuer and its members, officers, agents
(other than the Company) and employees against all liability, expected to be
incurred as a result of compliance with such request.
The principal of, prepayment penalty, if any, and interest on the Bonds
shall be payable solely from the funds pledged for their payment in accordance
with the Loan Agreement.
Section 12.6. IF PERFORMANCE DATE NOT A BUSINESS DAY. If the last date for
performance of any act or the exercising of any right, as provided in this
Agreement, shall not be a Business Day, such payment may be made or act
performed or right exercised on the next succeeding Business Day.
Section 12.7. BINDING EFFECT. This Agreement shall inure to the benefit of
and shall be binding upon the Issuer, the Company, and their respective
successors and assigns. No assignment of this Agreement by the Company shall
relieve the Company of its obligations hereunder.
Section 12.8. SEVERABILITY. In the event any provision of this Agreement
shall be held invalid or unenforceable by any court of competent jurisdiction,
such holding shall not invalidate or render unenforceable any other provision
hereof.
Section 12.9. AMENDMENTS, CHANGES AND MODIFICATIONS. Subsequent to the
issuance of the Bonds and prior to payment of the Bonds, this Agreement may not
be effectively amended, changed, modified, altered or terminated except by an
instrument in writing signed by the parties hereto, with the written consent of
the Agent.
Section 12.10. EXECUTION IN COUNTERPARTS. This Agreement may be executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.
Section 12.11. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State.
Section 12.12. NO THIRD-PARTY BENEFICIARY. It is specifically agreed
between the parties executing this Agreement that it is not intended by any of
the provisions of any part of this Agreement to establish in favor of the
public or any member thereof, other than as expressly provided herein, the
rights of a third-party beneficiary hereunder, or to authorize anyone not a
party to this Agreement to maintain a suit for personal injuries or property
43
damage pursuant to the terms or provisions of this Agreement. The duties,
obligations and responsibilities of the parties to this Agreement with respect
to third parties shall remain as imposed by law.
Section 12.13. TERM OF THIS AGREEMENT. This Agreement shall be in full
force and effect from the date hereof and shall continue in effect, unless
earlier terminated as set forth hereinabove, until the date title to the
Project Facility is conveyed to the Company in accordance with Section
5.1(b)(iii) hereof.
Section 12.14. SURVIVAL OF OBLIGATIONS. The obligations of the Company to
make the payments required by this Agreement and to provide the indemnity
required by this Agreement shall survive the termination of this Agreement and
the full payment of the Bonds, and all such other payments due hereunder after
such termination shall be made upon demand of the party to whom such payment is
due. The obligations of the Company with respect to the Unassigned Rights shall
survive the termination of this Agreement until the expiration of the period
stated in the applicable statute of limitations.
44
IN WITNESS WHEREOF, the Issuer and the Company have caused this Agreement
to be executed in their respective legal names and the signatures of duly
authorized persons to be attested, all as of the date first above written.
COUNTY OF CLINTON INDUSTRIAL
DEVELOPMENT AGENCY
By: /s/ illegible
---------------------------------------
(Vice) Chairman
Saranac Power Partners, L.P.
By: SARANAC ENERGY COMPANY, INC.,
its General Partner
By: /s/ illegible
---------------------------------------
Name:
Title: President
