Exhibit 10.03
Xx. Xxxxxxx Xxxx
Antrim Mining, Inc.
P.O. Box 38
Blossburg, PA 16912
Dear Rich,
This letter will confirm the agreement reached in recent telephone conversations
in which you represented your own interest, as well as that of Antrim Mining,
Xxxx Xxxxxxx and Xxxxxx Xxxx.
In the event of a "buy out" of our power purchase contract or our project
development rights, regardless of the form of such transaction, (referred to as
the "Settlement") we have agreed as follows:
1) Milesburg Energy, Inc. or Environmental Power Corporation will pay the
following sums in full and final payment of all outstanding
obligations under the Purchase and Sale Agreement dated April 30, 1987
between Xxxx X. Xxxxxxx, Xxxxxxx Xxxx and Xxxxxx X. Xxxx and
Environmental Power Corporation, the Pledge Agreement dated April 30,
1987 between Environmental Power Corporation and Xxxx X. Xxxxxxx, Xxxxxxx
Xxxx and Xxxxxx X. Xxxx and the Notes listed below:
Description of Note Obligation Final Settlement Price
a) Non-Recourse Secured Note II dated April 30,
1987 in the amount of $4,900,000 from $ 1,620,000.00
Environmental Power Corporation to Xxxx X.
Xxxxxxx, Xxxxxxx Xxxx and Xxxxxx X. Xxxx
b) Demand Note dated April 30, 1987 in the amount
of $139,000.00 from Milesburg Energy, Inc. to $ 139,000.00
Xxxxxxx Xxxx and Xxxxxx X. Xxxx
c) Demand Note dated April 30, 1987 in the amount
of $41,000 from Milesburg Energy, Inc. to Antrim $ 41,000.00
Mining, Inc.
2) All payments will be made directly from West Penn Power Company or its
parent, unless otherwise agreed to by Xxxxxxx Xxxx. Payment for #1 a.
shall be made $162,000 to Xxxx X. Xxxxxxx and $1,458,000 to Xxxxxxx Xxxx
and Xxxxxx X. Xxxx.
3) Payments for #1 above will be made on the same schedule and proportionate
to the receipt of payments pursuant to the Settlement arrangement. As
such, you would be paid your pro rata portion of any interest which is
paid to Milesburg Energy, Inc. or Environmental Power Corporation on
payments which are extended into the future.
4) If the amount paid as part of the Settlement is in excess of $15.5
million, Xxxxxxx, Xxxx and Antrim Mining, Inc., collectively, will
receive an additional amount equal to 12% of the excess over $15.5
million, such amount to be paid in accordance with paragraph 3.
Xx. Xxxxxxx Xxxx
August 26, 1997
Page 2 of 2
5) The Milesburg site will be returned to West Penn Power Company, or its
affiliate.
6) Subject to full receipt of the payment for #1 and #4 (if applicable)
above, all parties agree to release each other from the Purchase and Sale
Agreement dated April 30, 1987 between Xxxx X. Xxxxxxx, Xxxxxxx Xxxx and
Xxxxxx X. Xxxx and Environmental Power Corporation, the Pledge Agreement
dated April 30, 1987 between Environmental Power Corporation and Xxxx X.
Xxxxxxx, Xxxxxxx Xxxx and Xxxxxx X. Xxxx, the Notes described under #1
above, and the Non-Recourse Secured Note I dated April 30, 1987 in the
amount of $220,000 from Environmental Power Corporation to Xxxx X.
Xxxxxxx, Xxxxxxx Xxxx and Xxxxxx X. Xxxx.
7) All parties agree to execute any legal documents which may be required to
consummate the transactions contemplated by this letter agreement.
8) If the Settlement is not entered by December 31, 1997, then this
Agreement may be terminated at any time by Xxxxxxx, Xxxx and Antrim
Mining. Inc. If any party to the Settlement exercises any right to
terminate the Settlement after it has been entered, then this Agreement
may be terminated at any time by Xxxxxxx, Xxxx and Antrim Mining. Inc.
I believe the terms and conditions described above are in accordance with the
those reached in our recent telephone conversations. Please confirm the terms
of our Agreement by signing below and do not hesitate to contact me if you have
any questions.
Cordially,
Environmental Power Corporation and
Milesburg Energy, Inc.
By:
------------------------------------
Xxxxxx X. Xxxxxxxxxx
Vice President
Agreed on__________________________________, 1997 collectively by the following
parties provided a final and binding settlement with West Penn Power Company is
reached not later than December 31, 1997:
ANTRIM MINING, INC.
----------------------------
Xxxxxxx Xxxx
---------------------------- By:
Xxxxxx X. Xxxx ----------------------------
Title:
----------------------------
Xxxx X. Xxxxxxx
