Exhibit 4.9
EXECUTION COPY
PECO ENERGY COMPANY
CONSENT AND AGREEMENT
This CONSENT AND AGREEMENT (this "CONSENT"), dated as of
November 10, 1999 among PECO Energy Company, a Pennsylvania corporation (the
"CONSENTING PARTY"), Tenaska Georgia Partners, L.P., a Delaware limited
partnership (the "PARTNERSHIP"), and The Chase Manhattan Bank, a national
association organized and existing under the laws of the State of Delaware, as
collateral agent (together with its successors in such capacity, the "COLLATERAL
AGENT") for the benefit of the Senior Parties (as defined below).
RECITALS
WHEREAS, the Partnership proposes to develop, construct, lease
or own, operate and maintain a 936 megawatt ("MW") (nominal rating) natural
gas-fired electric generating plant, together with related facilities at Xxxxxx
Xxxxx Xxxx (xxx xxxx xxxxx xx Xxxxxxx 00) near the town of Franklin in Heard
County, Georgia (the "PROJECT");
WHEREAS, the Consenting Party and the Partnership have entered
into a Power Purchase Agreement, dated as of August 24, 1999 (the "ASSIGNED
AGREEMENT") pursuant to which the Partnership will sell and the Consenting Party
will purchase the capacity and associated energy from the Project;
WHEREAS, the Partnership intends to finance the development,
construction, lease or ownership, operation and maintenance of the Project,
through the issuance of certain bonds (the "BONDS") pursuant to a trust
indenture(the "INDENTURE"), dated as of November 1, 1999 between the Partnership
and The Chase Manhattan Bank, as Trustee (the "Trustee");
WHEREAS, the Partnership intends to obtain ancillary credit
facilities for the Project pursuant to a debt service reserve letter of credit
reimbursement agreement, dated November 10, 1999 between the Partnership, The
Toronto-Dominion Bank, as Agent and as letter of credit issuer, and the banks
party thereto (the "DSR LOC Reimbursement Agreement") and a power purchase
agreement letter of credit reimbursement agreement, dated November 10, 1999
between the Partnership, The Toronto-Dominion Bank, as Agent and as letter of
credit issuer, and the banks party thereto (the "PPA LOC Reimbursement
Agreement") and the Partnership may in the future enter into a working capital
facility (the "Working Capital Facility");
WHEREAS, the Project will initially be owned by the
Development Authority of Heard County, Georgia, a public corporation created and
existing under the laws of the State of Georgia (the "AUTHORITY"), and will be
leased to the Partnership pursuant to a Lease Agreement, dated as of November 1,
1999 between the Authority and the Partnership ("the Lease").
WHEREAS, the Senior Parties and the Partnership have entered
into the Collateral Agency and Intercreditor Agreement (as amended, restated,
modified or otherwise supplemented from time to time in accordance with the
terms thereof, the "COLLATERAL AGENCY AGREEMENT") to set forth their mutual
understanding with respect to (a) the exercise of certain rights, remedies and
options by the respective parties thereto under the above described documents,
(b) the priority of their respective security interests created by the Security
Documents, and (c) the appointment of the Collateral Agent as collateral agent
(the Bonds, the Indenture, the DSR LOC Reimbursement Agreement, PPA LOC
Reimbursement Agreement and the Working Capital Facility, the Lease and the
Collateral Agency Agreement shall collectively be known as the "Financing
Documents");
WHEREAS, as security for the Financing Documents, the
Partnership has assigned as security to the lenders and other credit providers
under the Financing Documents and to the Collateral Agent and the Trustee
(collectively, the Senior Parties") all of its right, title and interest in, to
and under, and granted a security interest in, the Assigned Agreement to the
Collateral Agent (as amended, restated, modified or otherwise supplemented from
time to time, the "Security Agreement); and.
WHEREAS, it is a condition precedent to the obligations of the
Senior Parties to enter into their respective Financing Documents that the
Consenting Party execute and deliver this Consent.
NOW, THEREFORE, in consideration of good and valuable
consideration, the receipt of which is hereby acknowledged, and intending to be
legally bound, the parties hereby agree as follows:
SECTION 1. CONSENT TO ASSIGNMENT, ETC.
1.1 CONSENT TO ASSIGNMENT. The Consenting Party (a) consents
in all respects to the pledge and assignment to the Collateral Agent of all of
the Partnership's right, title and interest in, to and under the Assigned
Agreement pursuant to one or more of the Security Documents and (b) acknowledges
the right, but not the obligation, of the Collateral Agent or a Qualified
Agent's Designee (as defined below), in the exercise of the Collateral Agent's
rights and remedies under the Security Documents, to make all demands, give all
notices, take all actions and exercise all rights of the Partnership in
accordance with the Assigned Agreement, and agrees that, in such event, the
Consenting Party shall continue to perform its obligations under the Assigned
Agreement in accordance with its terms.
For purposes of this Consent, a "QUALIFIED AGENT'S DESIGNEE"
means a corporation, partnership, joint venture, firm, a person or other legal
entity ("PERSON") that is designated by the Collateral Agent and that possesses,
a satisfactory level of experience in electric power plant operations to operate
the Plant (as defined in the Assigned Agreement) for a period of two hundred
seventy (270) days or such longer period of time as may reasonably be necessary
for the Collateral Agent to complete foreclosure proceedings upon, or otherwise
obtain title to, the Plant and to sell the Plant in a commercially reasonably
manner to a third party in order to maximize the sale price.
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1.2 SUBSTITUTE OWNER. The Consenting Party agrees that, if the
Collateral Agent shall notify the Consenting Party that an event of default
under any of the Financing Documents has occurred and is continuing and that the
Collateral Agent has exercised its rights (a) to have itself or a Qualified
Agent's Designee substituted for the Partnership under the Assigned Agreement or
(b) to sell, assign, transfer or otherwise dispose of the Assigned Agreement to
(i) a Person that possesses, a satisfactory level of experience in electric
power plant operations (a "PERMITTED TRANSFEREE") or (ii) any Person which has
acquired a partnership interest in the Partnership without contravening the
terms of the Assigned Agreement or this Consent, and any other Person under
common control with any of such Persons (each, a "SPONSOR"), then the Collateral
Agent, the Qualified Agent's Designee, such Permitted Transferee or such Sponsor
shall be substituted for the Partnership under the Assigned Agreement upon the
assumption by the Collateral Agent, the Qualified Agent's Designee, such
Permitted Transferee or such Sponsor, as the case may be, of all of the rights
and obligations of the Partnership under the Assigned Agreement pursuant to a
written assumption agreement (each, a "SUBSTITUTE OWNER") and that, in such
event, the Consenting Party will continue to perform its obligations under the
Assigned Agreement in accordance with its terms in favor of the Substitute
Owner.
Notwithstanding the foregoing, in no event shall a Substitute
Owner be any of the Persons (each, a "DISQUALIFIED PERSON") that the Consenting
Party so designates in accordance with this sentence in writing to the
Collateral Agent within ten (10) days of delivery of written notice by the
Collateral Agent to the Consenting Party that the Collateral Agent intends to
seek a purchaser for the Plant following an event of default under any of the
Financing Documents, provided that (i) the Consenting Party may only designate
up to three (3) Disqualified Persons (together with any Persons under common
control with any such Disqualified Persons) but only to the extent that the
Consenting Party has determined in good faith (and certified in writing to the
Collateral Agent) that such Disqualified Person is a Competitor (as defined in
the Assigned Agreement) of the Consenting Party in the sale, brokering or
marketing of electrical energy or capacity and that the sale, assignment or
other transfer of the Plant to such Disqualified Person would be detrimental to
the Consenting Party's competitive interests in the sale, brokering or marketing
of electrical energy and capacity and (ii) in no event shall the Consenting
Party designate any of the Sponsors as a Disqualified Person. No Person (other
than the Collateral Agent, the Qualified Agent's Designee or a Sponsor) that
otherwise qualifies as a Substitute Owner pursuant to this Section 1.2 shall be
a Substitute Owner for purposes of this Consent until eleven (11) days after the
Collateral Agent has delivered to the Consenting Party the above written notice.
1.3 RIGHT TO CURE. The Consenting Party agrees that in the
event of a default by the Partnership in the performance of any of its
obligations under the Assigned Agreement, or upon the occurrence or
non-occurrence of any event or condition under the Assigned Agreement which
would immediately or with the passage of any applicable grace period or the
giving of notice, or both, enable the Consenting Party to terminate or suspend
its obligations or exercise any other right or remedy under the Assigned
Agreement or under applicable law (hereinafter a "DEFAULT"), the Consenting
Party will continue to perform its obligations under the Assigned Agreement and
will not exercise any such right or remedy until it gives written notice of such
default to the Collateral Agent (a "DEFAULT NOTICE") and, as set forth in
Section 14.03(b) and (c) of the Assigned Agreement, affords the Collateral
Agent, the Qualified Agent's Designee and the
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Senior Parties a period to cure such default. Such cure period will be no less
than thirty (30) days (in the case of a monetary default) and seventy-five (75)
days (in the case of a non-monetary default) beginning upon the later of (a) the
Collateral Agent's receipt of the Default Notice and (b) the termination of the
Partnership's right to cure such default under the Assigned Agreement, provided
that in the event that a Substitute Owner assumes the rights and obligations of
the Partnership under the Assigned Agreement pursuant to a written assumption
agreement (a copy of which is provided to the Consenting Party by the later of
(i) sixty (60) days after receipt of the Default Notice and (ii) the termination
of the Partnership's right to cure such default under the Assigned Agreement),
such Substitute Owner shall have forty-five (45) days from the effective date of
the assumption of the rights and obligations of the Partnership under the
Assigned Agreement to cure such default or if such default is a non-monetary
default, such longer period as is required so long as such Substitute Owner has
commenced and is diligently pursuing appropriate action to cure such default;
provided, however, that if such Substitute Owner is prohibited from curing any
such default by any process, stay or injunction issued by any governmental
authority or pursuant to any bankruptcy or insolvency proceeding involving the
Partnership, the Collateral Agent, the Qualified Agent's Designee, the Senior
Parties or such Substitute Owner, then the time periods specified in this
Section 1.3 for curing a default shall be extended for the period of such
prohibition. In no event shall the cure rights provided in this Section 1.3
continue beyond (x) twelve (12) calendar months from the date of the Default
Notice in the case of a non-monetary default (unless the Partnership or the
Collateral Agent, the Qualified Agent's Designee or the Senior Parties post
$10,000,000 in Acceptable Credit Support (as defined in the Assigned Agreement),
in which case the cure rights provided in this Section 1.3 shall extend beyond
such twelve (12) calendar months) or (y) four (4) calendar months from the date
of the Default Notice in the case of a monetary default.
1.4 NO AMENDMENTS. The Consenting Party will not, without the
prior written consent of the Collateral Agent, enter into any consensual
cancellation or termination of the Assigned Agreement, or assign or otherwise
transfer any of its right, title and interest thereunder or consent to any such
assignment or transfer by the Partnership, provided that the Consenting Party
may assign the Assigned Agreement without the consent of the Collateral Agent in
the event that (i) the Consenting Party sells or otherwise transfers its power
marketing business to a buyer or transferee whose senior unsecured public debt
is rated by Xxxxx'x Investor Services, Inc. or Standard & Poors (each, a "RATING
AGENCY") at not less than the comparable rating of the Consenting Party's
unsecured senior debt at the time of such transfer and (ii) such Rating Agency
has confirmed in writing delivered to the Collateral Agent that the senior
unsecured public debt rating of such buyer or transferee shall remain in effect
following the assumption of the Assigned Agreement by such buyer or transferee.
The Consenting Party will not enter into any material amendment, supplement or
other modification of the Assigned Agreement (an "AMENDMENT") until after the
Collateral Agent has been given ten (10) days (excluding Saturdays, Sundays and
any days which are a legal holiday in New York or any days on which banking
institutions are authorized or required by law or government action to close)
prior written notice of the proposed Amendment by the Partnership (a copy of
which notice will be provided to the Consenting Party by the Partnership), and
will not then enter into such Amendment if the Consenting Party has, within such
ten (10) day period, received a copy of (i) the Collateral Agent's objection to
such Amendment or (ii) the Collateral Agent's request to the Partnership for
additional information with respect to such Amendment.
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1.5 NO LIABILITY. The Consenting Party acknowledges and agrees
that neither the Collateral Agent, the Qualified Agent's Designee or the Senior
Parties shall have any liability or obligation to the Consenting Party under the
Assigned Agreement as a result of this Consent or the assignment of the Assigned
Agreement to the Collateral Agent as security for the Bonds, nor shall the
Collateral Agent, the Qualified Agent's Designee or the Senior Parties be
obligated or required to (a) perform any of the Partnership's obligations under
the Assigned Agreement, except, in the case of the Collateral Agent or the
Qualified Agent's Designee, during any period in which the Collateral Agent or
the Qualified Agent's Designee is a Substitute Owner pursuant to Section 1.2, in
which case (i) the obligations of such Substitute Owner shall be no more than
that of the Partnership under such Assigned Agreement, and (ii) the sole
recourse of the Consenting Party shall be to such Substituted Owner and its
interest in the Project, or (b) take any action to collect or enforce any claim
for payment assigned as security for the Bonds.
1.6 PERFORMANCE UNDER ASSIGNED AGREEMENT. The Consenting Party
shall perform and comply with all material terms and provisions of the Assigned
Agreement to be performed or complied with by it and shall maintain the Assigned
Agreement in full force and effect in accordance with its terms and with all of
the Consenting Party's rights and remedies thereunder, subject to this Consent.
1.7 DELIVERY OF NOTICES. The Consenting Party shall deliver to
the Collateral Agent, concurrently with the delivery thereof to the Partnership,
a copy of each notice, request or demand given by the Consenting Party pursuant
to the Assigned Agreement.
1.8 ACKNOWLEDGMENTS. The Consenting Party agrees to execute
such acknowledgments or other similar instruments as the Collateral Agent shall
reasonably request in connection with the transactions provided for in this
Consent.
SECTION 2. PAYMENTS UNDER THE ASSIGNED AGREEMENT
2.1 PAYMENTS. The Consenting Party will pay all amounts
payable by it under the Assigned Agreement, if any, in the manner required by
the Assigned Agreement directly into the account specified on Exhibit A hereto,
or to such other person or account as shall be specified from time to time by
the Collateral Agent to the Consenting Party by not less than seven (7) business
days prior written notice. Amounts paid by the Consenting Party pursuant to
Section 9.04 of the Assigned Agreement shall be paid to the Collateral Agent in
trust for deposit into a PPA Disputed Payments Account Depositary Agreement in
the form of Exhibit D hereto, to be entered into with the bank specified
pursuant to Section 9.04(b) as the depositary for payments under the Assigned
Agreement, pending resolution of the dispute or the issuance of a final and
binding arbitral award or a binding court order directing a disposition of such
funds, in each case, in accordance with the terms of the Assigned Agreement.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE CONSENTING PARTY
The Consenting Party makes the following representations and
warranties (as of the date hereof), which shall survive the execution and
delivery of this Consent and the Assigned Agreement and the consummation of the
transactions contemplated hereby and thereby.
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3.1 ORGANIZATION; POWER AND AUTHORITY. The Consenting Party is
a corporation duly organized, validly existing and in good standing under the
laws of the state of its incorporation, and is duly qualified, authorized to do
business and in good standing in every jurisdiction in which it owns or leases
real property or in which the nature of its business requires it to be so
qualified, and has all requisite power and authority, corporate and otherwise,
to enter into and to perform its obligations hereunder and under the Assigned
Agreement, and to carry out the terms hereof and thereof and the transactions
contemplated hereby and thereby.
3.2 AUTHORIZATION. The execution, delivery and performance by
the Consenting Party of this Consent and the Assigned Agreement have been duly
authorized by all necessary corporate action on the part of the Consenting Party
and do not require any approval or consent of any holder (or any trustee for any
holder) of any indebtedness or other obligation of (a) the Consenting Party or
(b) any other person or entity, except approvals or consents which have
previously been obtained.
3.3 EXECUTION AND DELIVERY; BINDING AGREEMENTS. Each of this
Consent and the Assigned Agreement is in full force and effect, has been duly
executed and delivered on behalf of the Consenting Party by the appropriate
officers of the Consenting Party, and constitutes the legal, valid and binding
obligation of the Consenting Party, enforceable against the Consenting Party in
accordance with its terms, except as the enforceability thereof may be limited
by (a) bankruptcy, insolvency, reorganization, or other similar laws affecting
the enforcement of creditors' rights generally and (b) general equitable
principles (whether considered in a proceeding in equity or at law).
3.4 LITIGATION. There is no litigation, action, suit,
proceeding or investigation pending or (to the best of the Consenting Party's
knowledge) threatened against the Consenting Party before or by any court,
administrative agency, arbitrator or governmental authority, body or agency
which, if adversely determined, individually or in the aggregate, (a) is
reasonably likely to have a material adverse effect upon the performance by the
Consenting Party of its obligations hereunder or under the Assigned Agreement,
or which could modify or otherwise adversely affect the Approvals (as defined in
Section 3.6 of this Consent), (b) questions the validity, binding effect or
enforceability hereof or of the Assigned Agreement, any action taken or to be
taken pursuant hereto or thereto or any of the transactions contemplated hereby
or thereby or (c) is reasonably likely to have a material adverse effect upon
(i) the business, operations, properties, assets, or condition (financial or
otherwise) of the Consenting Party, (ii) the ability of the Consenting Party to
perform under the Assigned Agreement or this Consent, (iii) the business,
operations, properties, assets, prospects or condition (financial or otherwise)
of the Project, (iv) the value, validity, perfection and enforceability of the
liens granted to the Collateral Agent under the Security Documents or (v) the
ability of the Collateral Agent or the Senior Parties to enforce any of their
material rights and remedies under the Assigned Agreement or this Consent
(collectively, a "MATERIAL ADVERSE EFFECT").
3.5 COMPLIANCE WITH OTHER INSTRUMENTS, ETC. The Consenting
Party is not in violation of its charter or by-laws, and the execution, delivery
and performance by the Consenting Party of this Consent and the Assigned
Agreement and the consummation of the transactions contemplated hereby and
thereby will not result in any violation of, breach of or default under any term
of its charter or by-laws, or of any contract or agreement to which it is a
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party or by which it or its property is bound, or of any license, permit,
franchise, judgment, writ, injunction, decree, order, charter, law, ordinance,
rule or regulation applicable to it, except for any such violations which,
individually or in the aggregate, would not have a Material Adverse Effect on
the Consenting Party.
3.6 GOVERNMENT CONSENT. No consent, order, authorization,
waiver, approval or any other action, or registration, declaration or filing
with, any person, board or body, public or private (collectively, the
"APPROVALS"), is required to be obtained by the Consenting Party in connection
with the execution, delivery or performance of the Assigned Agreement or the
consummation of the transactions between the Partnership and the Consenting
Party contemplated thereunder, except as listed in Exhibit B hereto. All such
Approvals listed on Exhibit B, except for those set forth in Part II thereof
(the "DEFERRED APPROVALS"), are Final (as defined below). An Approval shall be
"FINAL" if it has been validly issued, is in full force and effect, is not
subject to any condition (other than compliance with the terms thereof), does
not impose restrictions or requirements inconsistent with the terms of the
Assigned Agreement, and is final and not subject to any appeal. The Consenting
Party reasonably believes that each Deferred Approval will be obtained in the
ordinary course of business prior to the time when such Deferred Approval is
required to be Final.
3.7 NO DEFAULT OR AMENDMENT. Neither the Consenting Party nor,
to the best of the Consenting Party's knowledge, any other party to the Assigned
Agreement is in default of any of its obligations thereunder. The Consenting
Party has no existing counterclaims, offsets or defenses against the
Partnership. The Consenting Party and, to the best of the Consenting Party's
knowledge, each other party to the Assigned Agreement have complied with all
conditions precedent to the respective obligations of such party to perform
under the Assigned Agreement. To the best of the Consenting Party's knowledge,
no event or condition exists which would either immediately or with the passage
of any applicable grace period or giving of notice, or both, enable either the
Consenting Party or the Partnership to terminate or suspend its obligations
under the Assigned Agreement. The Assigned Agreement has not been amended,
modified or supplemented in any manner.
3.8 REGULATION. The Consenting Party acknowledges and agrees
that, notwithstanding any adverse treatment or burdensome rate regulation that
may apply under any applicable federal, state or local law with respect to sales
by the Consenting Party of capacity and energy furnished under the Assigned
Agreement, its obligations to make payments required under the Assigned
Agreement and otherwise to perform its other obligations under the Assigned
Agreement shall not be diminished or reduced and shall remain valid and binding,
in accordance with the terms of the Assigned Agreement.
3.9 NO PREVIOUS ASSIGNMENTS. The Consenting Party has no
notice of, and has not consented to, any previous assignment of all or any part
of its rights under the Assigned Agreement.
3.10 REPRESENTATIONS AND WARRANTIES. All representations,
warranties and other statements made by the Consenting Party in the Assigned
Agreement were true and correct as of the date when made and are true and
correct in all material respects as of the date of this Consent.
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SECTION 4. OPINION OF COUNSEL
The Consenting Party shall deliver an opinion of counsel
relating to the Assigned Agreement and this Consent, which opinion shall be
substantially in the form attached hereto as Exhibit C.
SECTION 5. CLARIFICATIONS
5.1 "CREDIT DOCUMENTS" AND "FINANCIAL INSTITUTIONS". The
Consenting Party acknowledges and agrees that each of this Consent, the
Financing Documents and the Security Documents shall be deemed "CREDIT
DOCUMENTS" for all purposes of the Assigned Agreement. The Consenting Party
further acknowledges and agrees that each of the Senior Parties, the Collateral
Agent and their respective successors and assigns shall be deemed "FINANCIAL
INSTITUTIONS" for all purposes of the Assigned Agreement.
5.2 USE OF CASUALTY PROCEEDS. The Consenting Party hereby
agrees that Section 3.7 of the Collateral Agency Agreement dealing with the
treatment of casualty insurance proceeds, a copy of which is attached hereto as
Exhibit E, constitutes arrangements satisfactory to the Consenting Party under
Section 17.03(c) of the Assigned Agreement. The Consenting Party further agrees
that, notwithstanding anything to the contrary in Section 17.03(c) of the
Assigned Agreement, the Partnership shall not be obligated (and shall not be in
default under the Assigned Agreement for failure) to restore the Plant with any
casualty insurance proceeds resulting from an insured casualty loss to the Plant
if and to the extent that such casualty insurance proceeds are not released to
the Partnership for such purpose in accordance with the provisions of the
Collateral Agency Agreement attached hereto as Exhibit E. This Section 5.2 shall
not otherwise alter or amend the Partnership's obligations under Section
17.03(c) of the Assigned Agreement.
5.3 ASSIGNMENTS BY THE PARTNERSHIP. The Consenting Party
confirms that the prohibition on assignments in Section 12.01 of the Assigned
Agreement applies to assignments of the Assigned Agreement by the Consenting
Party and by the Partnership and not to transfers of partnership interests in
the Partnership, provided that PECO does not waive any right it may have to
contend that transfers after the date of this Consent of more than fifty percent
(50%) of the partnership interests of the Partnership to parties that are not in
common control with a Sponsor as of the date of this Consent is prohibited by
Section 12.01 thereof.
5.4 CLARIFICATIONS The following sections of the
Assigned Agreement are corrected as follows:
(a) The definition of Interconnection Agreement in the
Assigned Agreement shall be corrected to refer to "the Interconnection Agreement
dated as of October 19, 1999 between Georgia Power Company and the Partnership,
providing for the construction and operation of Interconnection Facilities
necessary for the delivery of energy to PECO pursuant to this Agreement at the
Primary Point of Delivery".
(b) The cross reference in Section 6.06(c) shall be corrected
to refer to Section 6.06(b);
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(b) Section 8.03(b) shall be corrected to read "The
Replacement Energy Payment shall be calculated in accordance with Section 8.12";
(c) Section 8.03(b)(i) shall be corrected by deleting the
words, "ends at hour 00:00 (midnight) for 600 MWh's, the Excess Run Time would
be 2 hours at 600 MWhs or 1200 MWhs times $2.00/MWh" at the end of the sentence;
(d) Section 8.08(d)(ii) shall be corrected to refer to "the
Annual Availability Percentage" in place of "Annual Availability";
(e) Section 8.09(a) shall be corrected by the deletion of the
word "or" at the end of the sentence; and
(f) Section 8.09(c) shall be corrected to read
"8.09(c) The Parties shall make Availability Adjustment
payments to each other at the end of each Contract Year as follows:
(i) If the amount of the Summer Availability Adjustment
that has been paid exceeds the Annual Availability Adjustment which has
not been rebated or otherwise paid to PECO, PECO shall make payment of
such difference to Tenaska by wire transfer in immediately available
funds within twenty (20) days of the end of a Contract Year provided
that if there is any Accrued Availability Adjustment for the preceding
Contract Years which has not been rebated to PECO, PECO shall offset
its payment obligation under this Section against such Accrued
Availability Adjustment.
(ii) If the Annual Availability Adjustment exceeds the
amount of the Summer Availability Adjustment that has been paid,
Tenaska shall make payment to PECO of such difference by offsetting all
amounts payable by PECO to Tenaska during succeeding months of the next
Contract Year until the amount of such offsets equals the Annual
Availability Adjustment; provided, however, that any Availability
Adjustment payable to PECO at the end of the Operating Term shall be
paid by wire transfer in immediately available funds within twenty (20)
days of the end of such Operating Term."
(g) The Consenting Party acknowledges that Confidential
disclosures have been made and will be made to the Trustee, the Collateral
Agent, credit rating agencies and the prospective and actual bond holders and
hereby waives the requirement of Section 16.02(a) of the Assigned Agreement that
would require the Trustee, the Collateral Agent, credit rating agencies and the
prospective and actual bond holders to enter into confidentiality agreements
with the Partnership, provided that the Partnership shall use reasonable efforts
to the extent consistent with its obligations under applicable securities law to
exclude specific pricing information in the Assigned Agreement from documents
that are available to the general public during the period prior to the filing
of the Assigned Agreement with FERC pursuant to Section 205 of the Federal Power
Act.
(h) The Parties confirm that Section 18.07 which provides that
a failure of a Party to insist, on any occasion, upon strict performance of the
Assigned Agreement shall not be a waiver of the right to insist upon strict
performance of any provision on any other occasion,
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incorporates the concept that any failure to offset amounts that are otherwise
due and owing shall not be a waiver of the right to claim payment of such
amounts.
(i) Except as herein provided, the Assigned Agreement shall
remain unchanged and in full force and effect and is hereby ratified and
affirmed by each of the parties thereto.
SECTION 6. MISCELLANEOUS
6.1 NOTICES. All notices and other communications hereunder
shall be in writing, shall be deemed given upon receipt thereof by the party or
parties to whom such notice is addressed, shall refer on their face to the
Assigned Agreement (although failure to so refer shall not render any such
notice of communication ineffective), shall be sent by first class mail, by
personal delivery or by a nationally recognized courier service, and shall be
directed as follows:
If to the Consenting Party:
PECO Energy Company - Power Team
0000 Xxxxxxxxxxx Xxxx.
Xxxx xx Xxxxxxx, XX 00000
Attention: Xxx X. Xxxxxxx
Fax: 000-000-0000
If to the Partnership:
Tenaska Georgia Partners, L.P.
0000 X. 000xx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Fax: 000-000-0000
If to the Collateral Agent:
The Chase Manhattan Bank, as Collateral Agent
Capital Markets Fiduciary Services
000 X. 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx
International & Project Finance Service
Delivery
The above parties may, by notice given hereunder, designate any further or
different addresses to which subsequent notices or other communications shall be
sent.
6.2 GOVERNING LAW; SUBMISSION TO JURISDICTION. (a) THIS
CONSENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF
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RELATING TO CONFLICTS OF LAW EXCEPT SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).
(b) Any legal action or proceeding with respect to this
Consent and any action for enforcement of any judgment in respect thereof may be
brought in the courts of the State of New York or of the United States of
America for the Southern District of New York, and, by execution and delivery of
this Consent, each of the Consenting Party, the Partnership and the Collateral
Agent hereby accepts for itself and in respect of its property, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
appellate courts from any appeal thereof. Each of the Consenting Party and the
Partnership hereby irrevocably designates, appoints and empowers CT Corporation
System, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, as its designee, appointee and
agent to receive, accept and acknowledge for and on its behalf, and in respect
of its property, service of any and all legal process, summons, notices and
documents which may be served in any action or proceeding. If for any reason
such designee, appointee and agent shall cease to be available to act as such,
the Partnership or the Consenting Party, as applicable, agrees to designate a
new designee, appointee and agent in New York City on the terms and for the
purposes of this provision satisfactory to the Collateral Agent. Each of the
Consenting Party, the Partnership and the Collateral Agent irrevocably consents
to the service of process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to the Consenting Party at its notice address provided
pursuant to Section 6.1 hereof. Each of the Consenting Party, the Partnership
and the Collateral Agent hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Consent brought in the
courts referred to above and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum. Nothing herein shall
affect the right of the Collateral Agent or its designees to serve process in
any other manner permitted by law or to commence legal proceedings or otherwise
proceed against the Consenting Party in any other jurisdiction.
6.3 COUNTERPARTS. This Consent may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.
6.4 HEADINGS DESCRIPTIVE. The headings of the several sections
and subsections of this Consent are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this Consent.
6.5 SEVERABILITY. In case any provision in or obligation under
this Consent shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
6.6 AMENDMENT, WAIVER. Neither this Consent nor any of the
terms hereof may be terminated, amended, supplemented, waived or modified except
by an instrument in writing signed by the Consenting Party and the Collateral
Agent.
11
6.7 TERMINATION; REFINANCING. (a) The Consenting Party's
obligations hereunder are absolute and unconditional, and the Consenting Party
has no right, and shall have no right, to terminate this Consent or to be
released, relieved or discharged from any obligation or liability hereunder
until all obligations under the Financing Documents (the "FINANCE LIABILITIES")
have been indefeasibly satisfied in full, notice of which shall be provided by
the Collateral Agent when all such obligations have been satisfied (the
"TERMINATION NOTICE"). Notwithstanding the foregoing or anything else to the
contrary contained herein, this Consent shall terminate on the earlier of (i)
the termination of the original term of the Bonds or (ii) the termination of the
Assigned Agreement in accordance with this Consent.
(b) In the event that the Collateral Agent delivers the
Termination Notice to the Consenting Party pursuant to Section 6.7(a) of this
Consent, this Consent shall terminate for all purposes as to the Collateral
Agent and the Financing Documents, and the Collateral Agent, the Senior Parties
and the Consenting Party shall have no further rights or obligations under this
Consent, provided, however that the Consenting Party agrees that this Consent
shall continue to apply for the benefit of the Partnership and the providers of
any new credit facilities (the "NEW LENDER") entered into by the Partnership to
refinance or replace the Finance Liabilities, provided that (i) within five days
following delivery by the Collateral Agent to the Consenting Party of the
Termination Notice as provided in Section 6.7(a), the New Lender or an agent,
trustee or other representative of the New Lender, shall have notified the
Consenting Party that it undertakes the prospective obligations of the
"COLLATERAL AGENT" under this Consent, and shall have supplied substitute notice
address information for Section 6.1 and new payment instructions (countersigned
on behalf of the Partnership) for Exhibit A hereto, (ii) the amount of the new
credit facilities do not exceed the original amount of commitments by the Senior
Parties to make loans and extend other credit facilities under the original
Financing Documents, and (iii) thereafter, (a) the term "FINANCE LIABILITIES"
under this Consent will be deemed to refer to the new credit facilities, (b) the
term "COLLATERAL AGENT" or "SENIOR PARTIES" shall be deemed to refer to the New
Lender or any agent or trustee for the New Lender, (c) the term "FINANCE
DOCUMENTS" shall be deemed to refer to the credit agreement, indenture or other
instrument providing for the new credit facilities and (d) the term "SECURITY
DOCUMENTS" shall be deemed to refer to the security agreements under which the
Assigned Agreement is assigned as collateral to secure performance of the
obligations of the Partnership under the new credit facilities.
6.8 SUCCESSORS AND ASSIGNS. This Consent shall be binding upon
the parties hereto and their permitted successors and assigns and shall inure to
the benefit of the parties, their designees and their respective permitted
successors and assigns.
6.9 FURTHER ASSURANCES. The parties hereto hereby agree to
execute and deliver all such instruments and take all such action as may be
necessary to effectuate fully the purposes of this Consent.
6.10 WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, THE CONSENTING PARTY, THE PARTNERSHIP AND THE COLLATERAL AGENT
HEREBY IRREVOCABLY WAIVE ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS CONSENT.
12
6.11 SURVIVAL. All agreements, statements, representations and
warranties made by the Consenting Party herein shall be considered to have been
relied upon by the Collateral Agent and the Senior Parties and shall survive the
execution and delivery of this Consent.
6.12 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of the Collateral Agent in exercising any right, power or privilege
hereunder and no course of dealing between the Consenting Party and the
Collateral Agent shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder preclude any other
exercise, or the further exercise, of any other right, power or privilege
hereunder. The rights and remedies herein expressly provided are cumulative and
not exclusive of any rights or remedies which the Collateral Agent would
otherwise have.
[THE NEXT PAGE IS THE SIGNATURE PAGE]
13
IN WITNESS WHEREOF, the Consenting Party, the Partnership and
the Collateral Agent have caused this Consent to be duly executed and delivered
by their respective officers thereunto duly authorized as of the date first
above written.
PECO ENERGY COMPANY
By: /S/ XXX X. XXXXXX
------------------------
Name: Xxx X. XxXxxx
Title: Senior Vice President, PECO Energy Company
and President, Power Team
TENASKA GEORGIA PARTNERS, L.P.
By: Tenaska Georgia, Inc.
Managing General Partner
By: /S/ XXXXXXX X. XXXXXX
------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President of Finance & Treasurer
THE CHASE MANHATTAN BANK,
as Collateral Agent
By: /S/ XXXXXXX X. XXXXXXX
------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Vice President
Exhibit A to
CONSENT AND AGREEMENT
PAYMENT INSTRUCTIONS
Chase Manhattan Bank ABA# 021 000 021
000 Xxxx 00xx Xxxxxx, 00xx Xx. Account Number: 507 891325
NY, NY 10001 Account Name: The Chase Manhattan Bank, as
Collateral Agent
Tenaska Georgia Partners,
L.P., Concentration Account
Vista Account Number: 294580000
For Further Credit to: Trust Acct. No.
C29458, The Chase Manhattan Bank, as
Collateral Agent, Tenaska Georgia - Revenue
Fund. Attention: X. Xxxxxxx
Exhibit B to
CONSENT AND AGREEMENT
APPROVALS
None
Exhibit C to
CONSENT AND AGREEMENT
FORM OF OPINION OF COUNSEL
November ____, 1999
To Addressees on Schedule B
Re: The 936 MW natural gas-fired electric generating
facility located in Heard County, Georgia (the
"PROJECT").
Dear Ladies and Gentlemen:
I have acted as counsel to PECO Energy Company, a Pennsylvania corporation
("PECO"), in connection with the Project to be constructed by Tenaska Georgia
Partners, L.P., a Delaware limited partnership (the "BORROWER"), from which PECO
will purchase capacity and energy pursuant to a Power Purchase Agreement, dated
as of August 24, 1999, between the Borrower and PECO (the "AGREEMENT"). This
opinion is delivered to you pursuant to the Agreement as to Certain
Undertakings, Common Representations, Warranties, Covenants and Other Terms
dated as of November 1, 1999 ("the Common Agreement") by and among TGP, The
Chase Manhattan Bank, as Trustee, The Toronto-Dominion Bank, as DSR LOC Agent,
The Toronto-Dominion Bank, as PPA LOC Agent and The Chase Manhattan Bank, as
Collateral Agent. Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in the Common Agreement.
In connection with this opinion, I have examined originals or
copies, certified or otherwise identified to my satisfaction, of the following:
(i) the Agreement;
(ii) the Consent and Agreement of PECO, dated as of the
date hereof (the "CONSENT");
(iii) the Certificate of Incorporation and By-laws of
PECO; and
(iv) general resolutions adopted by the Board of
Directors of PECO authorizing the President, and delegations of
authority to other officers, to take such actions as may be necessary
or convenient to execute contracts and other instruments.
The documents referred to in items (iii) and (iv) above are
hereinafter collectively referred to as the "GOVERNING DOCUMENTS" and the
Agreement and the Consent are hereinafter collectively referred to as the
"DOCUMENTS". In addition, I have examined and am familiar with
originals or copies, certified or otherwise identified to my satisfaction, of
such other documents as I have deemed necessary or appropriate as a basis for
the opinions set forth below. As to all factual matters, I have relied, to the
extent appropriate, upon statements and certificates of PECO officers and
appropriate public officials.
In my examination I have assumed the genuineness of all
signatures, the authenticity of all documents submitted to me as originals, the
conformity to original documents of all documents submitted to me as certified
or photostatic copies, and the authenticity of the originals of such copies. In
rendering the opinions expressed below, I have further assumed, without any
independent investigation or verification of any kind, that each Document I have
examined is the valid and binding obligation of each party thereto other than
PECO.
I am admitted to the Bar of the State of Pennsylvania. I
express no opinion as to the law of any jurisdiction other than (i) the laws of
the State of Pennsylvania and (ii) the federal laws of the United States of
America.
Based upon the foregoing and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, I am of the opinion
that:
1. PECO is a corporation duly organized, validly existing and
in good standing under the laws of the State of Pennsylvania. PECO is duly
qualified to transact business in each jurisdiction in which it owns or leases
real property or in which the nature of its business requires it to be so
qualified.
2. PECO has full corporate power and authority to enter into,
deliver and perform its obligations under each of the Documents.
3. PECO has taken all necessary corporate action to authorize
the execution, delivery and performance by it of each Document.
4. PECO has duly executed and delivered each Document.
5. Each Document constitutes the valid and binding obligation
of PECO enforceable against PECO in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting enforcement of creditors' rights
generally and by general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law).
6. The execution, delivery and performance by PECO of the
Documents will not (i) contravene any applicable provision of any currently
effective law, regulation, ruling, order or decree of any governmental authority
having jurisdiction over PECO and to which or by which PECO or any of its
property or assets is subject or bound or (ii) violate any provision of the
Governing Documents of PECO. The execution, delivery or performance by PECO of
the Documents do not and will not, to the best of my knowledge, materially
conflict with, result in any material breach of, or constitute a material
default under, or result in the creation or imposition of (or the obligation to
create or impose) any material lien or encumbrance upon any of the property or
assets of PECO pursuant to any provision of any securities issued by PECO, or
under any indenture, mortgage, deed of trust, contract, undertaking, document,
instrument or
other agreement to which PECO is a party or by which it or any of its property
or assets is bound.
7. No consent, order, authorization, waiver, approval or any
other action, or registration, declaration or filing with, any person, board or
body, public or private (collectively, the "APPROVALS"), is required to be
obtained by PECO in connection with the execution, delivery or performance of
the Documents or the consummation of the transactions contemplated thereby,
except as listed on Schedule A hereto. All such Approvals listed on Schedule A,
except for those set forth in Part II thereof, are Final (as defined below). An
Approval shall be Final if it has been validly issued, is in full force and
effect, is not subject to any condition (other than compliance with terms
thereof), doe s not impose restrictions or requirements inconsistent with the
terms of the Documents, and is final and not subject to any appeal.
8. To the best of my knowledge after due inquiry, there are no
pending or threatened actions or proceedings affecting PECO or any of its
properties or assets that individually or in the aggregate could prohibit or
limit in any way the execution, delivery and performance by PECO of any of the
Documents.
This opinion is being furnished only to the Agent, the
Borrower, the parties identified on Schedule B hereto and their respective
successors and assigns and is solely for the benefit of such parties; provided
that assignees of, or participants in, the interests of the Banks may rely on
this opinion as if it were addressed to them.
Very truly yours,
-----------------------
Xxx Xxxxxxx
For PECO Energy Company
Schedule A
APPROVALS
None
Schedule B
Exhibit D to
CONSENT AND AGREEMENT
PPA DISPUTED PAYMENTS ACCOUNT DEPOSITARY AGREEMENT
Exhibit E to
CONSENT AND AGREEMENT
CASUALTY INSURANCE PROVISIONS
[Section 3.7] LOSS PROCEEDS ACCOUNT. (a) All Loss Proceeds shall be paid
directly into the Loss Proceeds Account; PROVIDED that any insurance proceeds
related to any business interruption insurance policies shall be paid directly
into the Revenue Fund. If any Loss Proceeds are received by or on behalf of the
Partnership, such Loss Proceeds shall be received in trust for the Collateral
Agent, segregated from the other funds of the Partnership and immediately paid
to the Collateral Agent for deposit into the Loss Proceeds Account. Amounts held
in the Loss Proceeds Account shall be applied solely for the payment of the
costs of rebuilding, repair or restoration of the Project or as otherwise set
forth below.
(b) If an Event of Loss shall have occurred with respect to
the Project for which the Partnership receives Loss Proceeds less than or equal
to $10,000,000, the Collateral Agent shall withdraw and transfer to the
Partnership (or as otherwise directed by the Partnership) the amount of such
Loss Proceeds requested by the Partnership in an Officer's Certificate of the
Partnership which shall also describe how such Loss Proceeds shall be used;
PROVIDED that such Officer's Certificate shall certify that (i) no Event of
Default shall have occurred and be continuing, (ii) the Project can be rebuilt,
repaired or restored to permit operation of the Project or a portion thereof on
a commercially feasible basis and (iii) the Loss Proceeds, together with any
other amounts that are available to the Partnership for such rebuilding, repair
or restoration are sufficient to permit such rebuilding, repair or restoration
of the Project or a portion thereof, including the making of all required
payments of interest and principal on the Partnership's Indebtedness during such
rebuilding, repair or restoration.
(c) If an Event of Loss shall have occurred with respect to
the Project for which the Partnership receives Loss Proceeds in excess of
$10,000,000, the Collateral Agent shall withdraw and transfer to the Partnership
(or as otherwise directed by the Partnership) the amount of such Loss Proceeds
requested by the Partnership in an Officer's Certificate of the Partnership;
PROVIDED that (A) the Collateral Agent and the Independent Engineer shall have
received an Officer's Certificate of the Partnership and such Officer's
Certificate shall (i) describe in reasonable detail the nature of the
rebuilding, repair or restoration, (ii) state the cost of such rebuilding,
repair or restoration and the specific amount requested to be paid to the
Partnership (or as otherwise directed by the Partnership), the timing of such
payments and that such amount is requested to pay the cost thereof, (iii)
certify that the Project can be rebuilt, repaired or restored to permit
operation of the Project or a portion thereof on a commercially feasible basis,
(iv) certify that the Loss Proceeds, together with any other amounts that are
available to the Partnership for such rebuilding, repair or restoration are
sufficient to permit such rebuilding, repair or restoration of the Project or a
portion thereof, including the making of all required payments of interest and
principal on the Partnership's Indebtedness during such rebuilding, repair or
restoration, and (v) certify that the Partnership shall use its best efforts to
cause any repairs or restoration to be commenced and completed promptly and
diligently at its own cost
and expense (including the use of funds on deposit in the Loss Proceeds Account
(other than any Energy Contract Buy-Out proceeds or EPC Buy-Down proceeds)) and
(B) the Independent Engineer shall have provided to the Collateral Agent a
written certificate stating that, based on a reasonable investigation, it
believes that the certifications made by the Partnership are reasonable.
(d) If (i) the Partnership determines that the Project or a
portion thereof cannot be rebuilt, repaired or restored in accordance with the
provisions of [SECTION 3.7(C)] above or (ii) Excess Loss Proceeds greater than
$1,000,000 remain in the Loss Proceeds Account, then the Collateral Agent shall
withdraw such unused Loss Proceeds and transfer such amounts to the Revenue Fund
which such proceeds shall be distributed by the Collateral Agent in accordance
with the terms of [SECTION 3.18 (Exercise of Remedies - Loss Proceeds)] hereof.
