EXECUTION
VERSION
by and among
RIDGEWOOD ELECTRIC POWER TRUST I,
RIDGEWOOD OLINDA, LLC,
RIDGEWOOD ELECTRIC POWER TRUST IV,
RIDGEWOOD POWER B FUND/PROVIDENCE EXPANSION,
RIDGEWOOD RENEWABLE POWER, LLC, solely in its capacity as
Sellers’ Representative,
BREA PARENT 2007, LLC, solely with respect to
Section 8.8,
RHODE ISLAND LFG GENCO, LLC, solely with respect to
Section 8.8,
RIDGEWOOD RENEWABLE POWER, LLC, solely with respect to
Section 8.8,
RIDGEWOOD POWER MANAGEMENT LLC, solely with respect to
Section 8.8,
and
MIP II BIOPOWER LLC
as of July 26, 2010
TABLE OF
CONTENTS
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Page
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1
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Definitions
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A-1
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1.1 Certain Terms
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A-1
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1.2 Construction
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X-00
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0
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Xxxxxxxx and Sale of Interests
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A-15
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2.1 Purchase and Sale of Interests;
Consideration
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A-15
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2.2 Closing
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A-16
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2.3 Payment to Sellers’
Representative
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A-16
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2.4 Holdbacks
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A-17
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2.5 Sellers’ Calculation of Purchase
Price
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A-17
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2.6 Closing Statements
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A-17
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2.7 True-up
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A-18
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2.8 Repayment of Retention Amount
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A-19
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2.9 Swap Rate Adjustment
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A-19
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3
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Representations and Warranties as to the Sellers
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A-20
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3.1 Organization
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A-20
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3.2 Authorization of Transaction
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A-20
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3.3 Noncontravention
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A-20
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3.4 Brokers’ Fees
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A-20
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3.5 No Other Business Activities of the
Companies
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A-20
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3.6 Consent Statement
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A-21
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3.7 Investment Company Act
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A-21
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4
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Representations and Warranties of Trust I as to the Olinda
Companies
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A-21
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4.1 Organization of the Olinda Companies
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A-21
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4.2 Equity Interests
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A-21
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4.3 Title to Assets; Assets Used in the
Business
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A-22
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4.4 Noncontravention; Consents
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A-22
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4.5 Legal and Other Compliance; Permits
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A-23
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4.6 Olinda Project Contracts
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A-24
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4.7 Insurance
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A-25
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4.8 Litigation
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A-25
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4.9 Employees and Employee Benefits
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A-26
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4.10 Environmental Matters
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A-27
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4.11 Condemnation
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A-28
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4.12 Balance Sheet
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A-28
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4.13 No Undisclosed Liabilities
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A-29
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4.14 Taxes
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A-29
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4.15 Intellectual Property
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A-30
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4.16 Bankruptcy; Solvency
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A-31
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4.17 Treasury Grant
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A-31
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4.18 Absence of Certain Developments
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A-31
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4.19 Bank Accounts
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A-31
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A-i
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Page
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5
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Representations and Warranties of the Providence Sellers as to
the Providence Companies
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A-31
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5.1 Organization of the Providence
Companies
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A-31
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5.2 Equity Interests
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A-31
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5.3 Title to Assets; Assets Used in the
Business
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A-32
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5.4 Noncontravention; Consents
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A-33
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5.5 Legal and Other Compliance; Permits
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A-33
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5.6 Providence Project Contracts
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A-34
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5.7 Insurance
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A-36
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5.8 Litigation
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A-36
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5.9 Employees and Employee Benefits
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A-36
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5.10 Environmental Matters
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A-37
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5.11 Condemnation
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A-38
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5.12 Balance Sheet
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A-38
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5.13 No Undisclosed Liabilities
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A-39
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5.14 Taxes
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A-39
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5.15 Intellectual Property
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A-40
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5.16 Bankruptcy; Solvency
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A-41
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5.17 ITC Treasury Grant
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A-41
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5.18 Absence of Certain Developments
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A-41
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5.19 Bank Accounts
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A-41
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[Reserved]
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A-42
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7
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Representations and Warranties of the Buyer
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A-42
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7.1 Organization of the Buyer
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A-42
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7.2 Authorization of Transaction
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A-42
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7.3 Noncontravention; Consents
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A-42
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7.4 Brokers’ Fees
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A-42
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7.5 Litigation
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A-42
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7.6 [Reserved]
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A-43
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7.7 Availability of Funds
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A-43
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8
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Covenants of the Sellers
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A-43
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8.1 General
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A-43
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8.2 Notices, Consents and Approvals
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A-43
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8.3 Operation of Business
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A-44
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8.4 Access and Information
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A-47
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8.5 Schedule Update
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A-48
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8.6 Further Assurances
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A-48
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8.7 Access after Closing
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A-48
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8.8 Exclusivity
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A-48
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8.9 Affiliate Transactions
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A-49
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8.10 Non-Solicitation
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A-50
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8.11 Cooperation in connection with Financings
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A-51
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8.12 Interim Financial Statements
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A-52
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A-ii
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Page
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9
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Covenants of the Buyer
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A-52
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9.1 General
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A-52
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9.2 Notices, Consents and Approvals
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A-52
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9.3 Further Assurances
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A-53
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9.4 Access after Closing
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A-53
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9.5 Support Services
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A-53
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9.6 Use of Name
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A-53
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9.7 Acknowledgements and Agreements of
the Buyer
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A-54
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9.8 Purchase for Investment
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A-55
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10
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Conditions Precedent
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A-56
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10.1 Conditions to Obligation of the Buyer
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A-56
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10.2 Conditions to Obligation of the
Sellers
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A-57
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11
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Taxes
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A-58
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11.1 Liability for Taxes
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A-58
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12
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Survival; Obligations of Sellers; Indemnification; Remedies
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A-60
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12.1 Survival of Representations and
Warranties; Survival of Covenants and Agreements
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A-60
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12.2 Indemnity
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A-61
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12.3 Limitations on Liability
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A-62
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12.4 Indemnification Procedures
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A-62
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12.5 Remedies Exclusive
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A-63
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12.6 Manner of Payment
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X-00
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00
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Xxxxxxxxxxx
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A-64
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13.1 Termination of Agreement
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A-64
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13.2 Effect of Termination
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A-65
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14
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Miscellaneous
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A-66
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14.1 Press Releases and Public
Announcements
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A-66
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14.2 No Third Party Beneficiaries
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A-66
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14.3 No Joint Venture
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A-66
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14.4 Entire Agreement
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A-66
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14.5 Succession and Assignment
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A-66
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14.6 Counterparts
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A-66
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14.7 Headings; Interpretation
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A-66
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14.8 Notices
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A-67
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14.9 Governing Law
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A-67
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14.10 Consent to Jurisdiction; Venue; Service of
Process
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A-67
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14.11 Waiver of Jury Trial
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A-67
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14.12 Amendments and Waivers
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A-67
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14.13 Severability
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A-68
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14.14 Expenses
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A-68
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14.15 Construction
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A-68
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14.16 Disclosure Schedules
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A-68
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14.17 Specific Performance
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A-68
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14.18 Sellers’ Representative
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A-68
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A-iii
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ANNEXES*
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Annex 1
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Sellers’ Membership Interests in RILG
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Annex 2
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Specific line items to be included in the Current Assets of the
Olinda Companies and the Providence Companies
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Annex 3
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Specific line items to be included in the Current Liabilities of
the Olinda Companies and the Providence Companies
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Annex 4
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A description of the Olinda Expansion
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Annex 5
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A description of the Olinda Project
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Annex 6
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A description of the Providence Expansion
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Annex 7
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A description of the Providence Project
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Annex 8
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Olinda Companies and Providence Companies Interim Period Capital
and Maintenance Expenditures Budget
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Annex 9
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Olinda Expansion Interim Period Budget
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Annex 10
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Providence Expansion Interim Period Budget
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Annex 11
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Notices
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*The Registrant hereby agrees to furnish supplementally a
copy of any omitted Annexes to the Commission upon request.
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EXHIBITS**
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Exhibit A
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Employee Transfer Agreement
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Exhibit B
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Employment Agreement with Xxxxxxx X. Xxxxxx
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Exhibit C
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Employment Agreement with Xxxxxxx X. Xxxxxx
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Exhibit D
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Employment Agreement with Xxxxxxx X. Xxxxxxxx
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Exhibit E
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Transfer and Assignment Agreement
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Exhibit F
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Transition Services Agreement
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Exhibit G
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RIRRC Contract
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**The Registrant hereby agrees to furnish supplementally a copy
of any omitted Exhibits to the Commission upon request.
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DISCLOSURE SCHEDULES***
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Schedule 1.1
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Agreed Accounting Principles
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Schedule 3.3
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Non-contravention — Sellers
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Schedule 3.5(a)
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Other Business of Olinda Companies
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Schedule 3.5(b)
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Other Business of Providence Companies
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Schedule 4.1
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Organization of the Olinda Companies
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Schedule 4.3(a)
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Olinda Real Property
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Schedule 4.3(b)
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Olinda Personal Property
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Schedule 4.3(c)
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Assets Used in Olinda Operating Business
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Schedule 4.3(d)
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Condition of Olinda Real and Personal Property
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Schedule 4.4(a)
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Noncontravention — Olinda Companies
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Schedule 4.4(b)
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Notices — Olinda Companies
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Schedule 4.5(a)
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Olinda Legal Compliance
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Schedule 4.5(b)
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Olinda Operating Business Permits
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Schedule 4.5(c)
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Olinda Expansion Permits
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Schedule 4.5(d)
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Olinda Violations of Laws or Permits
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Schedule 4.6(a)
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Olinda Project Contracts
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Schedule 4.6(b)
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Olinda Project Contracts
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Schedule 4.7
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Olinda Insurance
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Schedule 4.8
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Olinda Litigation
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Schedule 4.9
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Olinda Employees and Employee Benefits
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Schedule 4.10
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Olinda Environmental Matters
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A-iv
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Schedule 4.11
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Olinda Condemnation
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Schedule 4.12
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Olinda Balance Sheet
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Schedule 4.13
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Olinda Liabilities
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Schedule 4.14
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Olinda Taxes
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Schedule 4.15
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Olinda Intellectual Property
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Schedule 4.18
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Olinda Absence of Certain Developments
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Schedule 4.19
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Olinda Bank Accounts
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Schedule 5.1
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Organization of the Providence Companies
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Schedule 5.3(a)
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Providence Real Property
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Schedule 5.3(b)
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Providence Personal Property
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Schedule 5.3(c)
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Assets Used in Providence Operating Business
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Schedule 5.3(d)
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Condition of Providence Real and Personal Property
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Schedule 5.4(a)
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Noncontravention — Providence Companies
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Schedule 5.4(b)
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Notices — Providence Companies
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Schedule 5.5(a)
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Providence Legal Compliance
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Schedule 5.5(b)
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Providence Operating Business Permits
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Schedule 5.5(c)
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Providence Expansion Permits
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Schedule 5.5(d)
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Providence Violations of Laws or Permits
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Schedule 5.6(a)
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Providence Project Contracts
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Schedule 5.6(b)
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Providence Project Contracts
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Schedule 5.7
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Providence Insurance
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Schedule 5.8
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Providence Litigation
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Schedule 5.9
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Providence Employees and Employee Benefits
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Schedule 5.10
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Providence Environmental Matters
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Schedule 5.11
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Providence Condemnation
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Schedule 5.12
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Providence Balance Sheet
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Schedule 5.13
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Providence Liabilities
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Schedule 5.14
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Providence Taxes
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Schedule 5.15
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Providence Intellectual Property
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Schedule 5.18
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Providence Absence of Certain Developments
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Schedule 5.19
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Providence Bank Accounts
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Schedule 7.7(a)
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Commitment Letters
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Schedule 7.7(b)
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Debt Term Sheet
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Schedule 8.3(b)
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Operation of Business
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Schedule 10.1(c)
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FERC Consents
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Schedule 10.1(i)
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Certain Other Conditions of Obligations of Buyer
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Schedule 10.1(i)(f)
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Draft EPC Contracts
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Schedule 10.1(i)(g)
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Maintenance Agreements
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Schedule 10.2(d)
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Sellers’ Consents
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Schedule 12.2(a)
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Trust I matters relating to Employee Transfer Agreement
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Schedule 12.2(b)
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Providence Sellers matters relating to Employee Transfer
Agreement
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***The Registrant hereby agrees to furnish supplementally a copy of any omitted Schedules to the Commission upon request.
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A-v
This
INTEREST PURCHASE AGREEMENT (the
“
Agreement”) is entered into as of
July 26, 2010, by and among Ridgewood Electric Power
Trust I, a Delaware statutory trust
(“
Trust I”), Ridgewood Olinda, LLC a
Delaware limited liability company (“
Ridgewood
Olinda”),
Ridgewood Electric Power Trust III, a
Delaware statutory trust (“
Trust III”),
Ridgewood Electric Power Trust IV, a Delaware statutory
trust (“
Trust IV”), Ridgewood Power B
Fund/Providence Expansion, a Delaware statutory trust
(“
B Fund”) Ridgewood Renewable Power, LLC, a
New Jersey limited liability company (“
RRP”),
solely in its capacity as Sellers’ Representative, Brea
Parent 2007, LLC, a Delaware limited liability company
(“
Brea Parent”), solely with respect to
Section 8.8, Rhode Island LFG Genco, LLC, a Delaware
limited liability company (“
RILG”), solely with
respect to Section 8.8, RRP, solely with respect to
Section 8.8, Ridgewood Power Management LLC, a Delaware
limited liability company (“
RPMC”), solely with
respect to Section 8.8, and MIP II Biopower LLC, a Delaware
limited liability company (the “
Buyer”).
Trust I, Ridgewood Olinda, Trust III, Trust IV,
and B Fund, are referred to collectively herein as the
“
Sellers,” and each, individually, as a
“
Seller.” The Buyer and the Sellers are each
referred to collectively herein as the
“
Parties,” and each, individually, as a
“
Party.”
1.1
Certain Terms. For
purposes of this Agreement, the following terms have the
meanings specified or referred to in this Section 1.1:
“Accountants” is defined in
Section 2.6(c).
“Acquired Operating Employees” is
defined in the Employee Transfer Agreement.
A-1
“Affiliate” means, with respect to any
Person, a Person that directly, or indirectly through one of its
intermediaries, controls or is controlled by, or is under common
control with, such Person. For purposes of this definition,
“control” (including, the terms
“controlling,” “controlled
by,” and “under common control with”)
means the possession, direct or indirect, of the power to direct
or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by
contract or otherwise, and such “control” will be
presumed if any Person owns 10% or more of the voting capital
stock or other ownership interests, directly or indirectly, of
any other Person. For purposes of this Agreement, Sellers shall
not be deemed to be Affiliates of Buyer or any of the Companies
after the Closing.
“Agreed Accounting Principles” means,
for any Company Group, GAAP (on a basis consistent with the
methodologies, practices, and principles used in the preparation
of the 2009 audited financial statements for such Company Group
as of the date and for the periods set forth therein for such
Company Group) with such deviations from GAAP and such other
matters as are set forth on Section 1.1 of the Disclosure
Schedules under the heading “Agreed Accounting
Principles”.
“Agreement” is defined in the
introductory paragraph.
“Allocation Schedule” is defined in
Section 11.1(h).
“Alternative Transaction” is defined in
Section 8.8(c).
“American Recovery and Reinvestment Act”
means the American Recovery and Reinvestment Act of 2009
(Pub. L.
111-5), as
amended.
“Annexes” means the annexes to this
Agreement.
“ARRA Grants” means grants made under
the American Recovery and Reinvestment Act pursuant to
Solicitation DE-FOA-0000044 (i) to BPII in the amount of
Nine Million Nine Hundred Seventy Three Thousand Seventy Four
Dollars ($9,973,074) for development of the Olinda Expansion,
and (ii) to RILG in the amount of Fourteen Million Nine
Hundred Seventy Three Thousand Seventy Three Dollars
($14,973,073) for development of the Providence Expansion.
“Assets” means, with respect to any
Company, all of the properties and assets (real or personal,
tangible or intangible) that are used or held for use by it, or
reflected in the Olinda Balance Sheet or the Providence Balance
Sheet, as applicable, or purchased or acquired by such Company
since the Balance Sheet Date, but excluding properties and
assets disposed of in the ordinary course of business since such
date.
“B Fund” is defined in the introductory
paragraph.
“Balance Sheet” means any of the Olinda
Balance Sheet or the Providence Balance Sheet, and
“Balance Sheets” means, collectively, the
Olinda Balance Sheet and the Providence Balance Sheet.
“Balance Sheet Date” means
April 30, 2010.
“Basis Point” means 1/100th of 1%.
“Brea Parent” is defined in the
introductory paragraph.
“Brea Parent Interests” means the
outstanding Equity Interests of Brea Parent.
“BPII” means Brea Power II, LLC, a
Delaware limited liability company.
“BPP” means Brea Power Partners, L.P., a
Delaware limited partnership.
“Business Day” means any day other than
a Saturday, Sunday or day on which banks are legally closed for
business in
New York,
New York.
“Buyer” is defined in the introductory
paragraph.
“Buyer Expenses” is defined in
Section 13.2(c).
A-2
“Buyer Olinda Closing Statement” is
defined in Section 2.6(a).
“Buyer Providence Closing Statement” is
defined in Section 2.6(a).
“Buyer Parties” means Buyer and its
respective Affiliates (including, after the Closing, the
Companies, but excluding Sellers and their Affiliates) and their
respective stockholders, officers, directors, employees, agents,
partners, members, representatives, successors and assigns.
“CAISO” means the California Independent
System Operator Corporation, or any successor entity.
“CERCLIS” is defined in
Section 4.10(e).
“Closing” is defined in Section 2.2.
“Closing Date” is defined in
Section 2.2.
“Closing Date Specified Assets” means,
with respect to a Company Group, the assets applicable to such
Company Group and described as such under items 1, 2, 3, 4,
and 5 of Part II of the Agreed Accounting Principles.
“Closing Date Specified Liabilities”
means, with respect to a Company Group, the liabilities
applicable to such Company Group and described as such under
items 2, 3, 5 and 6 of Part II of the Agreed
Accounting Principles.
“Closing Date Swap Rate” means the Swap
Rate determined as of the Closing Date, which shall be the Swap
Rate for the actual swaps executed by Buyer (if any) on such
date utilizing (i) the Periods set forth in
Section 2.9 of the Disclosure Schedules (where
“T” shall be the Closing Date) and (ii) the
Notional Amounts set forth in Section 2.9 of the Disclosure
Schedules. If no swap is executed by Buyer on such date or if
the swaps executed by Buyer utilizes Periods or Notional Amounts
that differ from the Periods or Notional Amounts set forth in
Section 2.9 of the Disclosure Schedules, then such Swap
Rate shall be requested from the five (5) Swap Dealers
based on the Periods and Notional Amounts set forth in
Section 2.9 of the Disclosure Schedules and will be the
average of the Swap Rates provided by three of such Swap Dealers
(after excluding the highest and lowest rates submitted by the
five (5) Swap Dealers).
“CMEEC PPA” means that certain Power
Purchase Agreement between RILG and Connecticut Municipal
Electric Energy Cooperative, effective July 19, 2010.
“Code” means the Internal Revenue Code
of 1986, as amended.
“Company” means any of the Olinda
Companies or the Providence Companies, and
“Companies” means, collectively, the Olinda
Companies and the Providence Companies.
“Company Group” means the Olinda
Companies or the Providence Companies, as the case may be.
“Confidentiality Agreement” means the
Confidentiality Agreement between the Buyer and Xxxxx
Xxxxxx & Co., on behalf of RRP, as managing
shareholder of the Trusts, dated December 22, 2009.
“Consent Solicitation” and
“Consent Solicitations” are defined in
Section 8.2(b).
“Consent Statement” and
“Consent Statements” are defined in
Section 8.2(b).
“Current Assets” means, with respect to
any Company Group, as of the date of determination, the sum of
the current assets of such Company Group as set forth on the
applicable Balance Sheet, which current assets in the case of
the Olinda Companies shall be the line items set forth on
Annex 2, and in the case of the Providence Companies
shall be the line items set forth on Annex 2, in
each case as such terms are used and calculated in accordance
with the Agreed Accounting Principles (and in each case
including the Closing Date Specified Assets for the applicable
Company Group).
“Current Liabilities” means, with
respect to any Company Group, as of the date of determination,
the sum of the current liabilities of such Person as set forth
on the applicable Balance Sheet, which current liabilities in
the case of the Olinda Companies shall be the line items set
forth on Annex 3, and in the case of the Providence
Companies shall be the line items set forth on
Annex 3, in each case as such
A-3
terms are used and calculated in accordance with the Agreed
Accounting Principles (and in each case including the Closing
Date Specified Liabilities for the applicable Company Group).
“DCO” means, with respect to the Olinda
EPC Contract, DCO California, Inc., a New Jersey corporation
(d/b/a DCal
Inc.), and with respect to the Providence EPC Contract, DCO
Energy, LLC, a New Jersey limited liability company.
“Debt Term Sheet” is defined in
Section 7.7(b).
“Disclosure Schedules” means the
disclosure schedules to this Agreement.
“Electronic Data Room” means the
electronic data room established by the Sellers in connection
with the transactions contemplated hereby.
“Emergency Situation” means, with
respect to any of the Projects, any unplanned occurrence or
condition that the Sellers conclude in good faith (after
consultation with Buyer, if time permits) requires immediate
action to prevent an immediate threat to health, safety, or
material threat to the operational integrity of such Project,
including, but not limited to, occurrences and conditions that
are materially adverse to such Project’s status with
respect to its Permits and the Environment.
“Employee Transfer Agreement” means the
Employee Transfer Agreement of even date herewith in the form of
Exhibit A, by and between RPMC, RRP, Ridgewood
Energy Corporation, a Delaware corporation, and the Buyer.
“Employment Agreements” means the
following, collectively:
(a) an agreement in the form of Exhibit B, by
and between Xxxxxxx X. Xxxxxx and MIP II Greenpower LLC, a
Delaware limited liability company;
(b) an agreement in the form of Exhibit C, by
and between Xxxxxxx X. Xxxxxx and MIP II Greenpower LLC, a
Delaware limited liability company; and
(c) an agreement in the form of Exhibit D, by
and between Xxxxxxx X. Xxxxxxxx and MIP II Greenpower LLC, a
Delaware limited liability company.
“Environment” means soil, land surface
or subsurface strata, real property, surface waters,
groundwater, wetlands, sediments, drinking water supply, ambient
air and any plant or animal life.
“Environmental Claim” means a claim by
any Person alleging a violation of Environmental Laws or an
Environmental Liability, alleging loss of life, injury to
persons, property or business or damage to natural resources.
“Environmental Laws” means all
applicable Laws and any binding administrative or judicial
interpretations thereof concerning: (i) the protection of
the Environment; (ii) the conservation, management,
development, control
and/or use
of land, natural resources and wildlife; or (iii) the
management, manufacture, possession, presence, use, generation,
transportation, treatment, storage, disposal, Release,
threatened release, abatement, removal, remediation, or handling
of, or exposure to, any Hazardous Substances; and includes,
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended,
42 U.S.C. § 9601 et seq.; the Solid
Waste Disposal Act, as amended, 42 U.S.C. § 6901
et seq.; the Federal Water Pollution Control Act
of 1972, as amended, 33 U.S.C. § 1251 et
seq.; the Clean Air Act of 1966, as amended,
42 U.S.C. § 7401 et seq., and all
analogous state statutes and regulations.
“Environmental Liabilities” means any
Liability arising under Environmental Laws resulting from or in
connection with: (i) any violation or alleged violation
of, or non-compliance or alleged non-compliance with,
Environmental Law with respect to the ownership, operation or
use of the Projects; (ii) any claim by any Person caused
or allegedly caused by the presence, exposure to, or Release of
Hazardous Substances at, on, in, under, adjacent to or migrating
from the Projects; (iii) the investigation
and/or
Remediation of Hazardous Substances that are present or have
been Released at, on, in, under, adjacent to or migrating from
the Projects; (iv) any claim by any Person arising from
the off-site disposal, treatment,
A-4
storage, transportation, discharge or Release of Hazardous
Substances in connection with the ownership, operation or use of
the Projects; and (v) the investigation
and/or
Remediation of Hazardous Substances that are generated,
disposed, treated, stored, transported, discharged or Released
in connection with the ownership, operation or use of the
Projects, at any Offsite Disposal Facilities.
“EPC Contracts” means the Olinda EPC
Contract and the Providence EPC Contract.
“Equity Commitment Letter” is defined in
the Recitals.
“Equity Financing” is defined in
Section 7.7.
“Equity Financing Commitment” is defined
in Section 7.7.
“Equity Interests” means, any and all,
(i) shares, interests, participations or other
equivalents (however designated) of capital stock of a
corporation and any and all ownership interests in a Person
(other than a corporation), including membership interests,
partnership interests, joint venture interests and beneficial
interests, or other equity securities, (ii) any and all
warrants, Options or rights to purchase any of the foregoing set
forth in clause (i) or commitments of any kind or character
relating to, or entitling any Person to purchase or otherwise
acquire, any of the foregoing set forth in clause (i),
(iii) securities convertible into or exercisable or
exchangeable for any securities set forth in clauses (i) or
(ii), and (iv) equity equivalents, interests in the
ownership or earnings of, or equity appreciation, phantom stock
or other similar rights.
“ERISA” means the Employee Retirement
Income Security Act of 1974, as amended.
“Estimated Closing Balance Sheet” means,
with respect to a Company Group, an estimated consolidated
balance sheet of such Company Group as of the Closing Date,
prepared in accordance with the Agreed Accounting Principles,
and identifying the Current Assets (including, the Closing Date
Specified Assets) and the Current Liabilities (including, the
Closing Date Specified Liabilities) of such Company Group.
“Estimated Olinda Closing Statement” is
defined in Section 2.5(a).
“Estimated Olinda Purchase Price” is
defined in Section 2.5(a).
“Estimated Providence Closing Statement”
is defined in Section 2.5(a).
“Estimated Providence Purchase Price” is
defined in Section 2.5(a).
“Exhibits” means the exhibits to this
Agreement.
“Expansion” or
“Expansions” means, individually or
together, the Olinda Expansion and the Providence Expansion.
“Evolution Markets Fees” means fees
payable to Evolution Markets on and after Closing in respect of
the PPA arrangements. The portion of such fees due at Closing is
reflected in item 5 (Other Matters Arising Prior to
Closing) on Part II of Agreed Accounting Principles.
“Federal Power Act” or
“FPA” means the Federal Power Act, as
amended.
“FERC” means the Federal Energy
Regulatory Commission, or its regulatory successor, as
applicable.
“Final Purchase Price” is defined in
Section 2.6(d).
“Financing” is defined in
Section 7.7.
“Financing Commitment” is defined in
Section 7.7.
“Financing Delay Determination” is
defined in Section 8.11(c).
“Financing Entities” is defined in
Section 8.11(a).
“GAAP” means United States generally
accepted accounting principles.
A-5
“Good Engineering Practices” means any
of the practices, methods and acts engaged in or approved by a
significant portion of the landfill gas electric generating
industry during the relevant time period, or any of the
practices, methods or acts that, in the exercise of reasonable
judgment in light of the facts known at the time the decision
was made, would have been expected to accomplish the desired
result at a reasonable cost consistent with good business
practices, reliability, safety, and expedition. Good Engineering
Practices are not intended to be limited to the optimum
practice, method or act to the exclusion of all others, but
rather to be acceptable practices, methods or acts generally
accepted in the applicable region, recommended by a manufacturer
or as required by any Governmental Authority or standards
setting agency including but not limited to FERC, a System
Operator, the North American Electric Reliability Corporation,
and the Electric Reliability Organization.
“Governing Documents” means, with
respect to any Person, the articles or certificate of
incorporation, association, formation or limited partnership,
any bylaws, limited liability company agreement, declaration of
trust, or other similar organizational document of such Person,
including any amendments or restatements thereto or thereof that
are effective on the date of determination.
“Governmental Authority” means any
federal, state, local, or foreign governmental, regulatory,
judicial, or administrative authority, agency or commission
(including FERC, the Federal Trade Commission and the United
States Department of Justice).
“Hazardous Substance” means: (i)
any petrochemical or petroleum products, oil, waste oil,
asbestos, urea formaldehyde foam insulation and polychlorinated
biphenyls; (ii) any products, mixtures, compounds,
materials or wastes, air emissions, toxic substances, wastewater
discharges and any chemical, material or substance listed or
regulated under applicable Environmental Laws; and (iii)
any materials or substances defined in Environmental Laws as
“hazardous,” “toxic,” “pollutant,”
or “contaminant,” or words of similar import
thereunder.
“Indebtedness” means, with respect to
any Person, without duplication (and excluding the ARRA Grants,
the Closing Date Specified Liabilities, and, with respect to a
Company Group, any amounts reflected as a Current Liability on
the Olinda Balance Sheet or the Providence Balance Sheet, as the
case may be and taken into account in determining Working
Capital for the applicable Company Group), all obligations of
such Person: (i) for borrowed money or in respect of
loans or advances, including all notes, advances, and other
inter-company obligations (with respect to any of the Companies
to Sellers or any of their Affiliates (other than the
Companies)), (ii) evidenced by bonds, debentures, notes
or other similar instruments or debt securities,
(iii) in respect of letters of credit and
bankers’ acceptances issued for the account of such Person,
(iv) arising from cash/book overdrafts, (v)
arising from deferred compensation arrangements and all
obligations under severance plans, bonus plans or similar
arrangements payable as a result of (even if paid subsequent to)
the consummation of the transactions contemplated hereby
(including all associated withholding taxes
and/or
employer matching obligations), (vi) secured by a Lien,
(vii) to pay the deferred purchase or acquisition price
of assets of such Person or services, including deferred rent
obligations (other than trade accounts payable (to the extent
included in Working Capital) arising, accrued expenses incurred,
for new materials, inventory, services and supplies incurred, in
each case in the ordinary course of business which are not more
than forty five (45) days past due based on the due date
specified in the invoice thereof, or if no due date is specified
in the invoice or if no invoice exists, then based on past
custom and practice), (viii) under capital lease
obligations, (ix) all accrued interest, prepayment
premiums or penalties related to any of the foregoing, and
(x) to guarantee the obligations described in
clauses (i) through (ix) of any other Person
(including, trade accounts payable).
“Indemnitee” is defined in
Section 12.4(a).
“Indemnitor” is defined in
Section 12.4(a).
“Indemnity Holdback” is defined in
Section 2.4.
“Intellectual Property” means all of the
following in any jurisdiction throughout the world:
(a) patents, patent applications, patent disclosures and
statutory invention registrations, including reissues,
divisions, continuations, continuations in part, extensions and
reexaminations thereof, all rights therein
A-6
provided by international treaties or conventions;
(b) trademarks, service marks, trade dress, trade names,
logos (and all translations, adaptations, derivations and
combinations of the foregoing) and Internet domain names,
together with all goodwill associated with each of the
foregoing, any and all common law rights, and registrations and
applications for registration thereof, all rights therein
provided by international treaties or conventions, and all
reissues, extensions and renewals of any of the foregoing;
(c) copyrightable works (including computer software source
code, executable code, databases and related documentation and
maskworks), copyrights, whether or not registered, and
registrations and applications for registration thereof, and all
rights therein provided by international treaties or
conventions; (d) confidential and proprietary information,
including trade secrets, unpatented inventions, data and
know-how; and (e) all other recognized forms of
intellectual property rights in any jurisdiction in the world.
“Intellectual Property” shall not include any matters
dedicated to the public and free for use by any person or entity.
“Interconnection Agreements” means the
Olinda Expansion Interconnection Agreement and the Providence
Expansion Interconnection Agreement.
“Interest Rate” means 3% per annum.
“Interests” means the Brea Parent
Interests and the RILG Interests.
“Interim Period” means that period of
time commencing on the date hereof and ending at the time of the
Closing.
“Investment Tax Credit” means the energy
tax credit available under Section 48(a) of the Code.
“ISO-NE” means ISO New England Inc., or
any successor entity.
“Knowledge” means: (i) with
respect to any of the Sellers or the Companies, the actual
knowledge of each of Xxxxxxx X. Xxxxxx, Xxxxxxx X. Xxxxxx,
Xxxxxxx X. Xxxxxxxx, Xxxxx Xxxxxxx, Xxxx Xxxxxxxxx or Xxxxx
XxXxxxx as the case may be, after making reasonable inquiry with
respect to the particular matter in question (including inquiry
of Xxx Xxxx, an independent consultant for the Companies
pursuant to that certain letter agreement, dated March 6,
2007, entered into by and between RPMC and West Engineering);
and (ii) with respect to the Buyer, the actual knowledge
of Xxxx Xxxxxxxxx or Xxxxx Xxxx, as the case may be, after
making reasonable inquiry with respect to the particular matter
in question.
“Law” means any federal, state, local or
foreign law (including any common law), statute, ordinance,
code, rule, requirement, regulation, order, judgment, or decree.
“Liability” or
“Liabilities” means any liability or
obligation (known or unknown, absolute, accrued, or contingent),
including any liability for Taxes.
“Lien” means any lien, security
interest, adverse claim, charge, or encumbrance of any kind.
“Losses” is defined in
Section 12.2(d).
“Maintenance Agreements” means those
contracts to which any Company is a party, or by which any
Company is bound, relating to the service or maintenance of a
Project.
“Market Rules and Procedures” means all
criteria, rules, tariff provisions, standards, procedures,
manuals, business practices or other documentation, obligations
or understandings that are imposed by a power pool, System
Operator, regional transmission organization or other similar
entity applicable to the Projects and obligations associated
therewith.
“Material Adverse Effect” means any
fact, event, change, development, circumstance, or effect,
individually or in the aggregate with other facts, events,
changes, developments, circumstances, or effects, that
(i) has had or would reasonably be expected to have,
a material adverse effect on the business, condition (financial
or otherwise), properties, assets, liabilities, results of
operations or prospects of (x) the Olinda Companies taken
as a whole, or the Olinda Expansion, (y) the Providence
Companies taken as a whole, or the Providence Expansion, or
(z) the Companies, taken as a whole, or the Expansions
taken as a whole; or (ii) materially impairs or delays
(or would reasonably be expected to materially impair or
A-7
delay) the ability of the Companies or the Sellers to consummate
the transactions contemplated by this Agreement or any other
Transaction Agreement or otherwise perform their respective
obligations hereunder or thereunder; provided, that, for
purpose of clause (i), any such fact, event, change,
development, circumstance or effect resulting from or arising
out of changes in (A) general economic conditions,
(B) the landfill gas electric generation industry, or
(C) general regulatory or political conditions affecting
the landfill gas electric generation industry (other than in the
cases of clauses (A), (B) and (C) any change in law
that (x) adversely affects the availability of the
Treasury Grant or ARRA Grants or (y) that renders either
the Olinda Expansion PPA, the Providence Expansion PPA or the
CMEEC PPA, terminable, which shall in the case of both
clause (x) and (y) constitute a Material Adverse
Effect), shall not constitute a Material Adverse Effect unless
such fact, event, change, development, circumstance or effect
has, or could reasonably be expected to have, a disproportionate
affect on, as applicable, (1) the Olinda Companies taken
as a whole, or the Olinda Expansion, as compared to other
Persons operating in the landfill gas electric generation
industry, (2) the Providence Companies taken as a whole,
or the Providence Expansion, as compared to other Persons
operating in the landfill gas electric generation industry, or
(3) the Companies taken as a whole, or the Expansions
taken as a whole, as compared to other Persons operating in the
landfill gas electric generation industry.
“Material Project Document” means
(i) the Olinda Expansion PPA, (ii) the Providence
Expansion PPA, (iii) the CMEEC PPA, (iv) when
executed, the Maintenance Agreements, (v) the EPC
Contracts, (vi) the Third Amended & Restated
Landfill Gas Rights & Production Facilities Agreement,
dated as of April 22, 2008, by and among the County of
Orange, BPP and Brea Power, (vii) the Amended and
Restated Site Lease and Landfill Gas Delivery Agreement, dated
as of November 17, 2008, between RIRRC and RILG,
(viii) the Amended and Restated Landfill Gas Services
Agreement, dated as of November 17, 2008, RGS, RIRRC and
RILG, in each case as amended from time to time, and (ix)
when executed, the Water and Sewer Agreements.
“Notice of Disagreement” is defined in
Section 2.6(b).
“Offsite Disposal Facility” means, with
respect to any Company, a location, other than a Project or a
Site that receives or received Hazardous Substances for
treatment, storage,
and/or
disposal by such Company.
“Olinda Balance Sheet” is defined in
Section 4.12.
“Olinda Closing Date Specified Assets
Payment” is defined in Section 2.1(b)(iii).
“Olinda Companies” means, collectively,
Brea Parent and its subsidiaries.
“Olinda Company Interests” is defined in
Section 4.2(a).
“Olinda Deductible” is defined in
Section 12.2(c).
“Olinda EPC Contract” means the contract
with DCO for the engineering, procurement, construction,
commissioning, and site preparation/decommissioning of the
Olinda Expansion.
“Olinda ERISA Affiliate” is defined in
Section 4.9(c).
“Olinda Expansion” means the expansion
of the Olinda Project, as described in Annex 4
hereto. For the avoidance of doubt, the term “Olinda
Expansion” does not include the Olinda Project.
“Olinda Expansion Interconnection Agreement”
means an agreement substantially in the form of SCE’s
standard form interconnection agreement complying with the
requirements of FERC governing the interconnection of the Olinda
Expansion to the transmission system operated by the California
ISO through SCE’s distribution system, or as otherwise
approved by the Buyer in its reasonable discretion.
“Olinda Expansion PPA” means that
certain Consolidated, Amended and Restated Purchase Agreement
entered into by and among BPP, BPII and the City of Anaheim,
California dated as of December 5, 2009, for the sale of
energy and related products generated by the Olinda Project and
Olinda Expansion.
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“Olinda Expansion Water and Sewer
Agreements” means agreements with the City of Brea
for the interconnection with the City of Brea’s water and
sewer systems and for the provision of water and sewer services,
in each case, in connection with the Olinda Expansion.
“Olinda Indemnity Holdback” is defined
in Section 2.4(a).
“Olinda Operating Business” means the
business of operating the Olinda Project as configured on the
date hereof, including the generation and sale of electricity,
capacity, ancillary services, environmental attributes and other
similar products within CAISO and engaging in contract
negotiations
and/or
planning activities, in each case, as undertaken on the date
hereof and relating to the Olinda Project. The term “Olinda
Operating Business” does not mean or include the business
activities involved in developing the Olinda Expansion.
“Olinda Operating Employee Plans” is
defined in Section 4.9.
“Olinda Project” means the
landfill-gas-fired electricity generating facility described in
Annex 5 and located at the Olinda Alpha Landfill in
Orange County, California. For the avoidance of doubt, the term
“Olinda Project” does not include the Olinda Expansion.
“Olinda Project Contracts” is defined in
Section 4.6.
“Olinda Purchase Price” is defined in
Section 2.1(b)(i).
“Olinda Recommendation” is defined in
Section 8.2(b).
“Olinda Specified Representations and
Warranties” is defined in Section 12.2(c).
“Olinda Swap Rate Adjustment” means the
product of (a) Thirty Three Thousand Dollars ($33,000)
multiplied by (b) the Swap Rate Change.
“Olinda Working Capital Surplus” is
defined in Section 2.1(b)(iii).
“Operating Employees” means, with
respect to either the Olinda Project or the Providence Project,
the employees of RPMC who are involved in the
day-to-day
physical or “hands-on” operation and maintenance of
such Project and the supervisors of such employees who are
employed by RPMC and
on-site at
such Project. The Operating Employees of the Olinda Project are
set forth on Section 4.9(a) of the Disclosure Schedules,
and the Operating Employees of the Providence Project are set
forth on Section 5.9(a) of the Disclosure Schedules.
“Option” means, with respect to any
Person, any security, right, subscription, warrant, option,
phantom equity rights or other contract that gives the right to
(i) purchase or otherwise receive or be issued any equity
interest of such Person or any security of any kind convertible
into or exchangeable or exercisable for any equity interest of
such Person, or (ii) receive or exercise any benefits or
rights similar to any rights enjoyed by or accruing to the
holder of the equity interests of such Person, including any
rights to participate in the equity or income of such Person,
the right to receive distributions or the right to participate
in or direct the election of any directors or officers of such
Person or the manner in which any equity interests of such
Person are voted.
“Parent Company” means any of Brea
Parent or RILG, and “Parent Companies” means,
collectively, Brea Parent and RILG.
“Party” and
“Parties” are defined in the
introductory paragraph.
“Permits” means, with respect to any
Project or Expansion (as applicable), all certificates,
licenses, permits, registrations, consents, waivers,
concessions, exemptions, orders, approvals, notices or other
authorizations of any Governmental Authority pertaining to such
Project or Expansion (as applicable) or to the ownership,
operation or use thereof.
“Permitted Encumbrance” means any of the
following: (i) Liens for Taxes or other charges or
assessments by any Governmental Authority which are not yet due
and payable or which are being contested in good faith by
appropriate proceedings (and for which adequate reserves, if any
are required,
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have been established on the applicable financial statements of
such Person in accordance with GAAP consistently applied);
(ii) Liens in the nature of zoning restrictions,
building and land use laws, ordinances, orders, decrees,
restrictions, or any other conditions imposed by any
Governmental Authority; (iii) Liens in favor of carriers,
warehousemen, mechanics, and materialmen and other like liens;
(iv) Liens or title imperfections with respect to any
Project created by or resulting from any act or omission of the
Buyer; (v) all exceptions (A) included in the
title commitments set forth in Section 4.3(a) of the
Disclosure Schedules in the case of the Olinda Companies,
(B) included in the title commitments set forth in
Section 5.3(a) of the Disclosure Schedules in the case of
the Providence Companies, or (C) discoverable based on a
review of the land records of the respective towns in which each
Project is located on or prior to the Balance Sheet Date none of
which materially detract from the operation or use of such
property in the business of the Olinda Companies or the
Providence Companies, as the case may be, as conducted on the
date hereof or as contemplated by the Expansions;
(vi) Liens arising from a purchase money security
interest of a third party; (vii) matters set forth on a
Disclosure Schedule, including but not limited to
Section 4.3(a) and Section 5.3(a) of the Disclosure
Schedules; and (viii) Liens arising temporarily in
connection with work, or the cost of work, undertaken in
connection with an Emergency Situation; and (ix) any
other Liens which do not materially interfere with the current
use of properties affected thereby or the Expansions.
“Person” means an individual, a
partnership, a corporation, an association, a joint stock
company, a trust, a joint venture, a limited liability company,
an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof).
“Plan” means any bonus, deferred
compensation, incentive compensation, employment, change in
control, retention, stock purchase, restricted stock, stock
option, severance, hospitalization or other medical, life or
other insurance, employee welfare, supplemental unemployment
benefit, fringe benefit, profit-sharing, pension or retirement
plan, program, policy, agreement or arrangement or any other
employee benefit plan, program, agreement or arrangement,
including without limitation any “employee pension benefit
plan” and any “employee welfare benefit plan” as
those terms are defined in Section 3 of ERISA, excluding
the Employment Agreements.
“Post-Closing Tax Period Taxes” is
defined in Section 11.1(b).
“Pre-Closing Tax Period” is defined in
Section 11.1(a).
“Production Tax Credit” means the
federal energy tax credit available under Section 45(a) of
the Code.
“Project” or
“Projects” means, individually or
together, the Olinda Project and the Providence Project, in each
case as such facility is configured on the date hereof.
“Providence Balance Sheet” is defined in
Section 5.12.
“Providence Closing Date Specified Assets
Payment” is defined in Section 2.1(b)(iii).
“Providence Companies” means,
collectively, RILG and its subsidiaries.
“Providence Company Interests” is
defined in Section 5.2(a).
“Providence Deductible” is defined in
Section 12.2(c).
“Providence EPC Contract” means the
contract with DCO for the engineering, procurement,
construction, commissioning, and site
preparation/decommissioning of the Providence Expansion.
“Providence ERISA Affiliate” is defined
in Section 5.9(c).
“Providence Expansion” means the
expansion of the Providence Project, as described in
Annex 6 hereto. For the avoidance of doubt, the term
“Providence Expansion” does not include the Providence
Project.
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“Providence Expansion Interconnection
Agreement” means an agreement substantially in the
form of ISO New England’s standard form interconnection
agreement complying with the requirements of FERC governing the
interconnection of the Providence Expansion to the transmission
system operated by ISO New England, or as otherwise approved by
Buyer in its reasonable discretion.
“Providence Expansion PPA” means the
Power Purchase Agreement between The Narragansett Electric
Company, d/b/a National Grid and RILG, dated May 21, 2010.
“Providence Expansion Water and Sewer
Agreements” means an agreement with the Town of
Xxxxxxx for the interconnection with its water and sewer system
and for the provision of water service, and agreements with
RIRRC and Narragensett Bay Commission for the interconnection
with their sewer systems and for the provision of sewer service,
in each case, in connection with the Providence Expansion.
“Providence Indemnity Holdback” is
defined in Section 2.4(b).
“Providence Operating Business” means
the business of operating the Providence Project as configured
on the date hereof, including the generation and sale of
electricity, capacity, ancillary services, environmental
attributes and other similar products within ISO-NE and the
State of Rhode Island, the operation of the related gas
collection system, and engaging in contract negotiations
and/or
planning activities, in each case, as undertaken on the date
hereof and relating to the Providence Project. The term
“Providence Operating Business” does not mean or
include the business activities involved in developing the
Providence Expansion.
“Providence Operating Employee Plans” is
defined in Section 5.9.
“Providence Project” means the
landfill-gas-fired electricity generating facilities described
in Annex 7 and located at the Central Landfill in
Johnston, Rhode Island. For the avoidance of doubt, the term
“Providence Project” does not include the Providence
Expansion.
“Providence Project Contracts” is
defined in Section 5.6.
“Providence Purchase Price” is defined
in Section 2.1(b)(ii).
“Providence Recommendation” is defined
in Section 8.2(b).
“Providence Sellers” is defined in the
Recitals.
“Providence Specified Representations and
Warranties” is defined in Section 12.2(c).
“Providence Swap Rate Adjustment” means
the product of (a) Seventy Seven Thousand Dollars ($77,000)
multiplied by (b) the Swap Rate Change.
“Providence Working Capital Surplus” is
defined in Section 2.1(b)(iii).
“Purchase Price” is defined in
Section 2.1(b)(ii).
“Qualified Plan” means any Olinda
Operating Employee Plan or any Providence Operating Employee
Plan (as applicable) that is intended to be a qualified plan
pursuant to Code Section 401(a).
“Recommendations” is defined in
Section 8.2(b).
“Reference Date Swap Rate” means 3.294%,
which was calculated in the manner set forth on Section 2.9
of the Disclosure Schedules.
“Release” means any actual, threatened,
or alleged spilling, leaking, pumping, pouring, emitting,
dispersing, emptying, discharging, injecting, escaping,
leaching, dumping, or disposing of any Hazardous Substance into
the Environment.
“Remediation” means any response,
removal, excavation, treatment, mitigation, abatement,
containment or similar action or measure required pursuant to
Environmental Laws in connection with a
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Release or threatened Release of Hazardous Substances, including
all testing, sampling, site reconnaissance or similar analysis
undertaken in connection with such action or measure.
“Representative” means, as to any
Person, such Person’s Affiliates and its and their
directors, officers, employees, agents, and advisors (including,
without limitation, financial advisors, counsel, and
accountants).
“Retention Amount” is defined in the
Employee Transfer Agreement.
“RIDEM” means the Rhode Island
Department of Environmental Management.
“RGS” means Ridgewood Gas Services LLC,
a Delaware limited liability company.
“Ridgewood Olinda” is defined in the
introductory paragraph.
“RILG” is defined in the introductory
paragraph.
“RILG Interests” means the outstanding
Equity Interests of RILG.
“RIRRC” means the Rhode Island Resource
Recovery Corporation, a Rhode Island corporation.
“RIRRC Contract” means the Second
Amendment to the Amended and Restated Site Lease and Landfill
Gas Delivery Agreement and to the Schedule of Definitions, to be
entered into by and among RILG, RGS and RIRRC.
“RPMC” is defined in the introductory
paragraph.
“RRP” is defined in the introductory
paragraph.
“SCE” means Southern California Edison
Company, a California corporation, or any successor thereof.
“Schedule Update” is defined in
Section 8.5.
“SEC” means the Securities and Exchange
Commission.
“Securities Act” is defined in
Section 9.9.
“Selling Expenses” means all of the fees
and expenses incurred by any of the Companies in connection with
the process of selling any of the Companies or the Olinda
Project or the Providence Project (plus Expansions thereof) or
otherwise relating to the negotiation, preparation or execution
of this Agreement or any documents or agreements contemplated
hereby or the performance or consummation of the transactions
contemplated hereby, in each case to the extent such fees or
expenses are obligations of the Companies and are not paid as of
the Closing, including (i) all brokers’ or
finders’ fees (but excluding the Evolution Markets Fees in
an amount not to exceed Two Million Two Hundred Thousand Dollars
($2,200,000)), (ii) all fees and expenses of
Representatives of Sellers or the Companies, and (iii)
any fees and expenses (including unpaid management fees) of any
manager or agent of any of the Companies or any of the Sellers
(including any trustee).
“Seller” and
“Sellers” are defined in the
introductory paragraph.
“Seller Indemnified Parties” is defined
in Section 12.2(d).
“Sellers’ Representative” means
RRP, with Xxxxxxx X. Xxxxxxxxx designated as an authorized
representative of RRP, acting on its behalf.
“Shareholder Approval” and
“Shareholder Approvals” are defined in
Section 3.2.
“Site” means, with respect to any
Project, the real property and improvements forming a part of,
or used or usable in connection with, such Project. Any
reference to a Site shall include, by definition, the surface
and subsurface elements, including the soils and groundwater
present at such Site, and any reference to items “at a
Site” shall include all items “at, on, in, upon, over,
across, under, and within” such Site.
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“Specified Energy Property” has the
meaning ascribed to such term in Section 1603(d) of the
American Recovery and Reinvestment Act.
“Sponsors” is defined in the Recitals.
“Straddle Period” is defined in
Section 11.1(b).
“Superior Proposal” means a bona fide,
unsolicited written Alternative Transaction which RRP, as the
managing shareholder of the Trusts, determines in good faith,
after consulting with and receiving advice from outside legal
and financial advisors, (i) is reasonably likely to be
consummated and (ii) that such Alternative Transaction,
if consummated in accordance with its terms, would be more
favorable from a financial point of view to the shareholders of
the Trusts than the transactions provided for in this Agreement
(including any adjustment to the terms and conditions of this
Agreement proposed by Buyer in accordance with
Section 8.8(b) in response to such Alternative
Transaction), in each case with respect to clause (i) and
(ii), taking into account all relevant factors including among
other things, the terms and conditions of the Alternative
Transaction, including any expense reimbursement provisions, and
the likelihood that such Alternative Transaction will be
consummated; provided, however, that to be
considered a Superior Proposal such transaction (A) shall
not be subject to a financial contingency, (B) the
financing for such transaction must be fully committed or
reasonably determined to be available, (C) such
transaction must be capable of completion without undue delay in
excess of the time period provided for Closing hereunder, and
(D) must be the acquisition of 100% of the assets of the
Companies or 100% of the Equity Interests of the Companies
(which, in each case, shall include all of the Olinda Companies
and all of the Providence Companies).
“Swap Dealers” means the five
(5) financial institutions listed on Section 2.9 of
the Disclosure Schedules. Should one or more of the Swap Dealers
be unwilling or unable to provide a Swap Rate quote, the Buyer
and the Sellers’ Representative will agree upon a
replacement for such non-quoting Swap Dealers, such agreement
not to be unreasonably withheld or delayed.
“Swap Rate” means as of a particular
date, the fixed rate that may be obtained by the Swap Dealers
under a zero cost interest rate swap and based on the applicable
floating rate on a floating rate loan having the terms and using
the term sheet forth in Section 2.9 of the Disclosure
Schedules. For any date the Swap Rate shall be determined using
base rate quotes for such rate provided by the five Swap Dealers
without the inclusion of any credit margin.
“Swap Rate Change” means the positive or
negative number of Basis Points obtained by subtracting the
Closing Date Swap Rate from the Reference Date Swap Rate
(Reference Date Swap Rate - Closing Date Swap Rate).
“System Operator” means the operator of
a transmission system for electric power and related products
and services, and the administrator of regional market
settlement systems for electric power and related products and
services as provided for under applicable Market Rules and
Procedures.
“Tax” or “Taxes”
means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, windfall profits, environmental,
customs duties, capital stock, franchise, profits, withholding,
social security (or similar, including FICA), unemployment,
disability, real property, personal property, sales, use,
transfer, registration, value added, alternative or add-on
minimum, estimated, or other tax or similar governmental charge
of any kind whatsoever, including any interest, penalty, or
addition thereto, whether disputed or not, and including any
obligations to indemnify or otherwise assume or succeed to the
tax liability of any other Person.
“Tax Audit” is defined in
Section 11.1(e).
“Tax Returns” means any return,
declaration, report, claim for refund, election, or information
return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
“Third Party Claim” is defined in
Section 12.4(a).
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“Termination Date” means
December 31, 2010.
“Termination Fee” is defined in
Section 13.2(c).
“Transaction Agreements” means this
Agreement, the Employment Agreements, the Employee Transfer
Agreement, the Transfer and Assignment Agreement and the
Transition Services Agreement.
“Transfer and Assignment Agreement”
means a Transfer and Assignment Agreement, substantially in the
form attached as Exhibit E.
“Transfer Taxes” is defined in
Section 11.1(f).
“Transition Services Agreement” means an
agreement between RPMC or its Affiliates, and one or more of the
Companies, substantially in the form attached as
Exhibit F, pursuant to which RPMC or its Affiliates
will provide certain transition services to the Companies after
the Closing.
“Treasury Grant” means, with respect to
Specified Energy Property, a cash grant in lieu of Production
Tax Credits and Investment Tax Credits available under
Section 1603 of the American Recovery and Reinvestment Act.
“Treasury Guidance” means “Payments
for Specified Energy Property in Lieu of Tax Credits under the
American Recovery and Reinvestment Act of 2009,” published
by the U.S. Treasury Department, Office of the Fiscal
Assistant Secretary, July
2009/Revised
March 2010.
“Treasury Regulations” means the federal
income Tax regulations promulgated under the Code.
“Trust I” is defined in the
introductory paragraph.
“Trust III” is defined in the
introductory paragraph.
“Trust IV” is defined in the
introductory paragraph.
“Trusts” means, individually or
collectively, Trust I, Trust III, Trust IV, and B
Fund.
“Water and Sewer Agreements” means the
Olinda Expansion Water and Sewer Agreements and the Providence
Expansion Water and Sewer Agreements.
“Working Capital” means, with respect to
any Company Group, an amount (which may be positive or negative)
equal to the Current Assets of such Company Group (including the
Closing Date Specified Assets) minus the Current Liabilities of
such Company Group (including the Closing Date Specified
Liabilities).
1.2
Construction. The words
“hereof,” “herein,” and
“hereunder” and words of like import used in this
Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement. References to
Sections, Annexes, and Exhibits are to Sections, Annexes, and
Exhibits of this Agreement unless otherwise specified. All
Exhibits, Annexes, and Disclosure Schedules annexed hereto or
referred to herein are hereby incorporated in and made a part of
this Agreement as if set forth in full herein. Any capitalized
term used in any Exhibit, Annex, or Disclosure Schedule but not
otherwise defined therein shall have the meaning given to such
term in this Agreement. Any singular term in this Agreement
shall be deemed to include the plural, and any plural term the
singular. Whenever the words “include,”
“includes,” or “including” are used in this
Agreement, they shall be deemed to be followed by the words
“without limitation,” whether or not they are in fact
following by those words or words of like import.
“Writing,” “written,” and comparable terms
refer to printing, typing, and other means of reproducing words
(including electronic media) in a visible form. References to
any agreement or contract are to that agreement or contract as
amended, modified, or supplemented from time to time in
accordance with the terms hereof and thereof. References to any
Person include the successors and permitted assigns of that
Person. References from or through any date mean, unless
otherwise specified, from and including or through and
including, respectively. Any reference to “days” means
calendar days unless Business Days are expressly specified. If
any action under this Agreement is required to be done or taken
on a day that is not a Business Day, then such action shall be
required to be done or taken not on such day but on the first
succeeding Business Day thereafter.
X-00
(a) Subject to the terms and conditions of this Agreement
(including the satisfaction or waiver by the Sellers of the
conditions precedent set forth in Section 10.2), at the
Closing:
(i) in exchange for the Olinda Purchase Price, Trust I
shall sell, assign, transfer, and convey to the Buyer, and the
Buyer shall purchase from Trust I, all of the Brea Parent
Interests (free and clear of all Liens on such
Interests); and
(ii) in exchange for the Providence Purchase Price, the
Providence Sellers shall sell, assign, transfer, and convey to
the Buyer, and the Buyer shall purchase from the Providence
Sellers, all of the RILG Interests (free and clear of all Liens
on such Interests).
(b) Subject to the terms and conditions of this Agreement
(including the satisfaction or waiver by the Buyer of the
conditions precedent set forth in Section 10.1), at the
Closing:
(i) Subject to Section 2.4, in consideration for the
sale, assignment, transfer, and conveyance of the Brea Parent
Interests, the Buyer shall pay to the Sellers’
Representative (for the benefit of Trust I and its
shareholders), and the Sellers’ Representative (for the
benefit of Trust I and its shareholders) shall accept from
the Buyer, an aggregate amount equal to (A) Seven Million
Five Hundred Thousand Dollars ($7,500,000), plus
(B) subject to Section 2.1(b)(iii), the Working
Capital of the Olinda Companies (as of 12:01 a.m. on the
Closing Date), which may be a negative amount, minus
(C) the Indebtedness of the Olinda Companies as of the
Closing, minus (D) the Selling Expenses of the
Olinda Companies, minus (E) the Retention Amount
that is payable by the Buyer under the Employee Transfer
Agreement to Acquired Operating Employees of the Olinda Project
(which includes any amounts payable to Xxxxx Xxxxxxx pursuant to
that certain letter dated May 15, 2008 entered into by and
among RRP and Xxxxx Xxxxxxx, and any amounts payable to such
Operating Employees pursuant to that certain memo dated
October 26, 2007 and titled “Growth of the Ridgewood
Renewal Power Business,” and any associated deductions,
withholding taxes (to the extent not already included in the
Retention Amount) or projected employer matching obligations
that may be required by applicable law), and plus
(F) the Olinda Swap Rate Adjustment, which may be a
negative amount (the “Olinda Purchase Price”);
(ii) Subject to Section 2.4, in consideration for the
sale, assignment, transfer, and conveyance of the RILG
Interests, the Buyer shall pay to the Sellers’
Representative (for the benefit of the Providence Sellers and
their shareholders), and the Sellers’ Representative (for
the benefit of the Providence Sellers and their shareholders)
shall accept from the Buyer, an aggregate amount equal to
(A) Seventeen Million Five Hundred Thousand Dollars
($17,500,000), plus (B) subject to
Section 2.1(b)(iii), the Working Capital of the Providence
Companies (as of 12:01 a.m. on the Closing Date), which may
be a negative amount, minus (C) the Indebtedness
of the Providence Companies as of the Closing, minus
(D) the Selling Expenses of the Providence Companies,
minus (E) the Retention Amount that is payable by
the Buyer under the Employee Transfer Agreement to Acquired
Operating Employees of the Providence Project (which includes
any amounts payable to such Operating Employees pursuant to that
certain memo dated October 26, 2007 and titled “Growth
of the Ridgewood Renewal Power Business,” and any
associated deductions, withholding taxes (to the extent not
already included in the Retention Amount) or projected employer
matching obligations that may be required by applicable law),
and plus (F) the Providence Swap Rate Adjustment,
which may be a negative amount (the “Providence Purchase
Price” and, together with the Olinda Purchase Price,
the “Purchase Price”); and
(iii) (A) If the Working Capital of the Olinda
Companies (as of 12:01 a.m. on the Closing Date) as
reflected in the Estimated Olinda Closing Statement is positive
(an “Olinda Working Capital Surplus”) and the
value of the Olinda Closing Date Specified Assets exceeds the
value of the Olinda Closing Date Specified Liabilities, then at
the Closing Buyer shall pay to the Sellers’ Representative
(for the benefit of Trust I and its shareholders), and the
Sellers’ Representative (for the benefit of Trust I
and its shareholders) shall accept from the Buyer the amount
representing the difference between (1) the Olinda Closing
Date Specified Assets minus (2) the Olinda Closing
Date Specified Liabilities (the “Olinda
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Closing Date Specified Assets Payment”) (such
payment not to exceed the Olinda Working Capital Surplus). If
the Olinda Working Capital Surplus exceeds the Olinda Closing
Date Specified Assets Payment, then Buyer will pay to the
Sellers’ Representative (for the benefit of Trust I
and its shareholders), and the Sellers’ Representative (for
the benefit of Trust I and its shareholders) shall accept
from the Buyer the amount representing such excess (as finally
determined pursuant to Section 2.6 and at such time as
contemplated by Section 2.7) (and such excess amount shall
not be paid by Buyer at the Closing). (B) If the Working
Capital of the of the Providence Companies (as of
12:01 a.m. on the Closing Date) as reflected in the
Estimated Providence Closing Statement is positive (a
‘‘Providence Working Capital Surplus”) and
the value of the Providence Closing Date Specified Assets
exceeds the value of the Providence Closing Date Specified
Liabilities, then at the Closing Buyer shall pay to the
Sellers’ Representative (for the benefit of the Providence
Sellers and their shareholders), and the Sellers’
Representative (for the benefit of the Providence Sellers and
their shareholders) shall accept from the Buyer the amount
representing the difference between (1) the Providence
Closing Date Specified Assets minus (2) the
Providence Closing Date Specified Liabilities (the
“Providence Closing Date Specified Assets
Payment”) (such payment not to exceed the Providence
Working Capital Surplus). If the Providence Working Capital
Surplus exceeds the Providence Closing Date Specified Assets
Payment, then Buyer will pay to the Sellers’ Representative
(for the benefit of Trust I and its shareholders), and the
Sellers’ Representative (for the benefit of Trust I
and its shareholders) shall accept from the Buyer the amount
representing such excess (as finally determined pursuant to
Section 2.6 and at such time as contemplated by
Section 2.7) (and such excess amount shall not be paid by
Buyer at the Closing).
2.2
Closing. The closing of the
purchase and sale of the Brea Parent Interests and the RILG
Interests (the “
Closing”) shall occur as soon
as practicable following the date on which each of the
conditions set forth in Section 10 has either been
satisfied or waived by the Party for whose benefit such
condition exists (other than conditions that by their terms are
to be satisfied at the Closing, but subject to the satisfaction
or waiver of such conditions);
provided,
however,
that Buyer (in its sole discretion) may elect to delay the
Closing for up to twelve (12) Business Days following the
date on which each of the conditions set forth in
Section 10 has either been satisfied or waived for the
purpose of permitting sufficient time for the Sponsors to call
capital from their limited partners for the purpose of funding
their equity contribution to Buyer pursuant to the terms of the
Equity Commitment Letter, except that no such delay shall extend
the Closing beyond the Termination Date. Notwithstanding any
such election made by Buyer, all conditions to Closing set forth
in Section 10 must remain satisfied during such time period
and no such election made by Buyer shall be deemed a waiver of
any condition set forth in Section 10. The Closing shall
occur at the offices of McGuireWoods LLP, 1345 Avenue of the
Americas, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000
(or such other place as agreed by the Parties). The date of
Closing is hereinafter called the “
Closing
Date.”
(a) No later than three (3) Business Days prior to the
Closing Date, the Sellers’ Representative shall notify the
Buyer of the wire instructions for the account or accounts to
which the Olinda Purchase Price shall be paid by the Buyer to
the Sellers’ Representative (for the benefit of the
shareholders of Trust I). The Sellers’ Representative
shall be responsible for distributing the Olinda Purchase Price
to Trust I, and Trust I hereby agrees that payment of
the Olinda Purchase Price to the account or accounts notified by
the Sellers’ Representative shall satisfy the requirement
for payment thereof under this Agreement.
(b) No later than three (3) Business Days prior to the
Closing Date, the Sellers’ Representative shall notify the
Buyer of the wire instructions for the account or accounts to
which the Providence Purchase Price shall be paid by the Buyer
to the Sellers’ Representative (for the benefit of the
shareholders of the Providence Sellers). The Sellers’
Representative shall be responsible for distributing the
Providence Purchase Price among the Providence Sellers, and each
of the Providence Sellers hereby agrees that payment of the
Providence Purchase Price to the account or accounts notified by
the Sellers’ Representative shall satisfy the requirement
for payment thereof under this Agreement.
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(a) At the Closing, the Buyer shall withhold from the
payment of the Olinda Purchase Price an amount equal to Two
Million Dollars ($2,000,000) (the “Olinda Indemnity
Holdback”).
(b) At the Closing, the Buyer shall withhold from the
payment of the Providence Purchase Price an amount equal to
Three Million Dollars ($3,000,000) (the “Providence
Indemnity Holdback,” and together with the Olinda
Indemnity Holdback, the “Indemnity Holdback”).
(a) The Sellers’ Representative will prepare, or cause
to be prepared, and delivered to the Buyer, at least ten
(10) days prior to the Closing Date, a statement (the
“Estimated Olinda Closing Statement”) setting
forth its good faith estimates of the components of the Olinda
Purchase Price (the amount of the Olinda Purchase Price
calculated using such components is referred to herein as the
“Estimated Olinda Purchase Price”), a statement
(the “Estimated Providence Closing Statement”)
setting forth its good faith estimate of the components of the
Providence Purchase Price (the amount of the Providence Purchase
Price calculated using such components is herein referred to as
the “Estimated Providence Purchase Price”) and
each of the Estimated Closing Balance Sheets from which such
statements were derived. The Estimated Closing Balance Sheets,
the Estimated Olinda Purchase Price and Estimated Providence
Purchase Price will be prepared in accordance with the Agreed
Accounting Principles.
(b) If the Buyer disagrees with any amounts set forth on
the Estimated Olinda Closing Statement or the Estimated
Providence Closing Statement, each delivered pursuant to
Section 2.5(a), the Buyer may, within five (5) days
after delivery of such statement, deliver a notice to the
Sellers’ Representative disagreeing with such calculation
and setting forth the Buyer’s calculation of such amounts
and, in reasonable detail, the Buyer’s grounds for such
disagreement. For the avoidance of doubt, Buyer shall not be
deemed to have agreed with such statement if Buyer fails to
deliver such notice within such time period.
(c) The Sellers’ Representative agrees to consider in
good faith any comments delivered by the Buyer pursuant to
Section 2.5(b). Within three (3) days after delivery
of any notice by the Buyer pursuant to Section 2.5(b), the
Sellers’ Representative will either (i) deliver
written notice to the Buyer indicating that the Sellers’
Representative will not be making any changes to the Estimated
Olinda Closing Statement
and/or the
Estimated Providence Closing Statement, as applicable, or
(ii) deliver to the Buyer a revised Estimated Olinda
Closing Statement
and/or a
revised Estimated Providence Closing Statement, as applicable.
(d) With respect to the Olinda Companies, the components
used to calculate the Olinda Purchase Price on the Closing Date
shall be: (i) as shown on the Estimated Olinda Closing
Statement, if either no comments are delivered by the Buyer
pursuant to Section 2.5(b), or the Sellers’
Representative has delivered a written notice to the Buyer
pursuant to Section 2.5(c)(i); or (ii) as shown on
the revised Estimated Olinda Closing Statement delivered by the
Sellers’ Representative pursuant to
Section 2.5(c)(ii). With respect to the Providence
Companies, the components used to calculate the Providence
Purchase Price on the Closing Date shall be: (i) as shown
on the Estimated Providence Closing Statement, if either no
comments are delivered by the Buyer pursuant to
Section 2.5(b), or the Sellers’ Representative has
delivered a written notice to the Buyer pursuant to
Section 2.5(c)(i); or (ii) as shown on the revised
Estimated Providence Closing Statement delivered by the
Sellers’ Representative pursuant to Section 2.5(c)(ii).
(a) As promptly as practicable, but no later than sixty
(60) days, after the Closing Date, the Buyer will cause to
be prepared and delivered to the Sellers’ Representative
statements setting forth the Buyer’s calculation of the
components of the Olinda Purchase Price and the Providence
Purchase Price, each as of the Closing (the “Buyer
Olinda Closing Statement” and the ‘‘Buyer
Providence Closing Statement,” respectively), and
noting any changes from the Estimated Olinda Closing Statement
or the Estimated Providence Closing Statement. Such statements
will be prepared in accordance with the Agreed Accounting
Principles.
(b) If the Sellers’ Representative disagrees with any
amounts set forth on the Buyer Olinda Closing Statement or the
Buyer Providence Closing Statement, each delivered pursuant to
Section 2.6(a), the Sellers’ Representative may,
within thirty (30) days after delivery of such statement,
deliver a notice (the “Notice of
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Disagreement”) to the Buyer disagreeing with such
calculation and setting forth the Sellers’ Representative
calculation of such amounts and in reasonable detail the
Sellers’ Representative’s grounds for such
disagreement. The Notice of Disagreement shall specify those
items or amounts as to which the Sellers’ Representative
disagrees, and the Sellers’ Representative shall be deemed
to have agreed with (and the Accountants described in
Section 2.6(c), if any, shall be deemed to be bound by) all
other items and amounts contained in the Buyer Olinda Closing
Statement and Buyer Providence Closing Statement, each delivered
pursuant to Section 2.6(a).
(c) If a Notice of Disagreement shall be duly delivered
pursuant to Section 2.6(b), the Buyer and the Sellers’
Representative shall, during the fifteen days following such
delivery, use their reasonable best efforts to reach agreement
on the disputed items or amounts in order to determine the Final
Purchase Price of the applicable Company Group. Any written
agreement by the Buyer and the Sellers’ Representative
resolving any disputed items or amounts during such period or
any mutually agreed extension thereof shall be final and binding
upon the Parties. If, during such period, the Buyer and the
Sellers’ Representative are unable to reach such agreement,
they shall promptly thereafter cause KPMG LLP (the
“Accountants”) to promptly review the
definition of Purchase Price and any such disputed items or
disputed amounts for the purpose of calculating the Final
Purchase Price of the applicable Company Group. In making such
calculation, the Accountants shall consider only those items or
amounts in the Buyer Olinda Closing Statement and the Buyer
Providence Closing Statement as to which the Sellers’
Representative has disagreed and shall resolve such disputes by
applying the Agreed Accounting Principles. The Accountants shall
deliver to the Buyer and the Sellers’ Representative,
within thirty (30) days of their engagement, a report
setting forth such calculation. Such report shall be final and
binding upon the Parties. The cost of such review and report
shall be allocated to and paid by the Buyer, on the one hand,
and the Sellers’ Representative (for the benefit of the
Sellers of the relevant Company Group or Company Groups), on the
other hand, in the same proportion that the aggregate amount of
the money at issue in such disputed items submitted to the
Accountants that are unsuccessfully disputed by them (as finally
determined by the Accountants) bears to the total amount of such
disputed items, which proportionate allocation shall also be
determined by the Accountants and be included in the
Accountants’ report.
(d) With respect to the Olinda Companies and the Providence
Companies, the “Final Purchase Price” of such
Company Group shall be: (i) the Olinda Purchase Price or
the Providence Purchase Price (as applicable) of such Company
Group as calculated using the components identified in the Buyer
Olinda Closing Statement or the Buyer Providence Closing
Statement (as applicable) and delivered pursuant to
Section 2.6(a), if no Notice of Disagreement with respect
thereto is duly delivered pursuant to Section 2.6(b); or
(ii) if such a Notice of Disagreement is delivered, the
Olinda Purchase Price or the Providence Purchase Price (as
applicable) of such Company Group (A) calculated
using the components agreed by the Buyer and the Sellers’
Representative pursuant to Section 2.6(c) or (B) in
the absence of such agreement, calculated using the components
shown in the Accountant’s calculation delivered pursuant to
Section 2.6(c).
(e) The Buyer and the Sellers agree that they will, and
each agrees to cause its (and the Companies) accountants to, and
after the Closing Date, the Buyer agrees to cause the Companies
to, cooperate and assist in the preparation of the statements of
the components of the Olinda Purchase Price and the Providence
Purchase Price (as applicable) contemplated by this
Section 2 and in the conduct of the reviews referred to in
this Section 2.6, including making available to the extent
necessary books, records, work papers, and personnel and
granting the Sellers’ Representative and the Buyer (as
applicable) and their respective Representatives access at
reasonable times and places to all books, records, and employees
of the Companies and RPMC reasonably requested by the
Sellers’ Representative or the Buyer in connection
therewith.
(a) Upon the determination of the Final Purchase Price of
the applicable Company Group:
(i) If the amount of the Final Purchase Price for a Company
Group is greater than the Estimated Olinda Purchase Price or the
Estimated Providence Purchase Price (as applicable), the Buyer
will pay to the Sellers’ Representative (for the benefit of
the shareholders of Trust I or the Providence Sellers (as
applicable)), the amount by which such Final Purchase Price is
greater than the Estimated Olinda
A-18
Purchase Price or the Estimated Providence Purchase Price (as
applicable). In determining any such amounts payable by Buyer
pursuant to this Section 2.7(a)(i), such determination
shall take into consideration the Olinda Specified Assets
Payment and the Providence Specified Assets Payment paid by
Buyer at Closing and the Providence Working Capital Surplus or
Olinda Working Capital Surplus, if any, not paid by Buyer at
Closing and contemplated to be paid at this time as set forth in
Section 2.1(b)(iii). If a payment is required to be made by
the Buyer to the Sellers’ Representative pursuant to this
Section 2.7(a)(i), within twelve (12) Business Days
after such determination, the Buyer shall pay such amount to the
Sellers’ Representative (for the benefit of the
shareholders of Trust I or the Providence Sellers (as
applicable)) by wire transfer of immediately available funds in
such manner as is notified to the Buyer by the Sellers’
Representative in writing no later than two (2) Business
Days prior to the date of payment. Any payment made by the Buyer
pursuant to this Section 2.7(a)(i) shall be made together
with interest on such amount accruing at the Interest Rate from
the Closing Date to, but excluding, the date of such payment.
(ii) If the amount of the Final Purchase Price for a
Company Group is less than the Estimated Olinda Purchase Price
or the Estimated Providence Purchase Price (as applicable), on
the fifth (5th) Business Day after such determination, the Buyer
may retain the amount by which such Final Purchase Price is less
than the Estimated Olinda Purchase Price or the Estimated
Providence Purchase Price (as applicable) for such Company
Group, from the Olinda Indemnity Holdback or the Providence
Indemnity Holdback (as applicable). In no event shall
Trust I be required to make any payment pursuant to this
Section 2.7(a)(ii) other than from the Olinda Indemnity
Holdback. In no event shall the Providence Sellers be required
to make any payment pursuant to this Section 2.7(a)(ii)
other than from the Providence Indemnity Holdback. Any payment
made by a Seller pursuant to this Section 2.7(a)(ii) shall
be made together with interest on such amount accruing at the
Interest Rate from the Closing Date to, but excluding, the date
of such payment. In determining any such amounts payable to
Buyer pursuant to this Section 2.7(a)(ii), such
determination shall take into consideration the Olinda Specified
Assets Payment and the Providence Specified Assets Payment paid
by Buyer at Closing and the Providence Working Capital Surplus
or Olinda Working Capital Surplus, if any, not paid by Buyer at
Closing and contemplated to be paid by Buyer at this time as set
forth in Section 2.1(b)(iii).
(a) If, after the Closing Date, RPMC
and/or RRP,
based on information provided by the Buyer pursuant to
Section 2.6(c) of the Employee Transfer Agreement,
determine that all or some of the Retention Amount does not have
to be paid to the Acquired Operating Employees, RPMC
and/or RRP
shall direct the Buyer to pay, and the Buyer shall pay, in
accordance with such direction, to the Sellers’
Representative (for the benefit of the shareholders of
Trust I or the Providence Sellers (as applicable)), any
portion of the Retention Amount that is not paid by the Buyer
pursuant to Section 2.6(a) of the Employee Transfer
Agreement, including any amounts retained by the Buyer in
connection with the payment of any deductions, withholding taxes
or projected employer matching obligations that would have been
required by applicable law with respect to such Retention Amount.
(b) If, after the Closing Date, RPMC
and/or RRP,
based on information provided by the Buyer pursuant to
Section 2.6(c) of the Employee Transfer Agreement,
determine that there are any excess employer matching
contributions with respect to any payment of the Retention
Amount to an Acquired Operating Employee as a result of such
Acquired Operating Employee having exceeded the applicable
unemployment tax or Social Security wage base at the time of
such payment, RPMC
and/or RRP
shall direct the Buyer to pay, and the Buyer shall pay, in
accordance with such direction, to the Sellers’
Representative (for the benefit of the shareholders of
Trust I or the Providence Sellers (as applicable)), the
amount of such.
(c) Any payment made by the Buyer pursuant to this
Section 2.8 shall be made together with interest on such
amount accruing at the Interest Rate from the Closing Date to,
but excluding, the date of such payment.
2.9
Swap Rate Adjustment. The
Olinda Purchase Price and the Providence Purchase Price to be
paid by the Buyer at the Closing shall be increased or decreased
by a dollar amount equal to the Olinda Swap Rate Adjustment and
the Providence Swap Rate Adjustment, respectively. If the
Closing Date Swap Rate is greater
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than the Reference Date Swap Rate, the Olinda Purchase Price and
the Providence Purchase Price shall each be reduced;
provided, however, that the sum of any such
Providence Purchase Price reduction and Olinda Purchase Price
reduction shall not exceed Five Million Dollars ($5,000,000) in
the aggregate. If the Closing Date Swap Rate is less than the
Reference Date Swap Rate, the Olinda Purchase Price and the
Providence Purchase Price shall each be increased;
provided, however, that the sum of any such
Providence Purchase price increase and Olinda Purchase Price
increase shall not exceed Five Million Dollars ($5,000,000) in
the aggregate. The Buyer shall calculate each of the Closing
Date Swap Rate, the Olinda Swap Rate Adjustment and the
Providence Swap Rate Adjustment in good faith. The Buyer shall
provide to the Sellers’ Representative a statement setting
forth in reasonable detail such calculations, including, without
limitation, the quotes and supporting documentation provided by
each Swap Dealer. Such statement shall be delivered to the
Sellers’ Representative no later than noon Eastern Time on
the Closing Date.
3
Representations and Warranties as to the
Sellers. Each Seller makes the
representations and warranties set forth in Section 3.1
through Section 3.7 below to the Buyer, as of the date
hereof and as of the Closing Date, in each case with respect to
itself and not with respect to any other Seller.
3.1
Organization. Such Seller is
duly organized, validly existing, and in good standing (to the
extent applicable) under the laws of the jurisdiction of its
organization.
3.2
Authorization of
Transaction. Such Seller has the power and
authority to execute and deliver this Agreement and the other
Transaction Agreements to which it is a party and perform its
obligations hereunder and thereunder in accordance with the
terms hereof and thereof. The execution and delivery by such
Seller of this Agreement and the other Transaction Agreements to
which it is a party and the performance of such Seller’s
obligations hereunder and thereunder in accordance with the
terms hereof and thereof have been duly authorized by all
necessary action on the part of such Seller and no other
corporate, trust or other proceedings are necessary to authorize
this Agreement or to consummate the transactions contemplated
hereby other than the affirmative vote of the holders of a
majority of the outstanding Equity Interests of each Seller to
adopt this Agreement (each a “
Shareholder
Approval” and together, the “
Shareholder
Approvals”). Such Seller has duly executed and
delivered this Agreement and, as of the Closing Date, will have
duly executed and delivered the other Transaction Agreements to
which it is a party, and this Agreement constitutes, and each
such Transaction Agreement when so executed and delivered will
constitute, the valid and binding obligation of such Seller,
enforceable against such Seller in accordance with its terms,
except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium, or other similar Laws
relating to or affecting creditors generally, and subject to
general principles of equity (regardless of whether enforcement
thereof is in a proceeding at law or in equity), in each case as
now or hereafter in effect.
3.3
Noncontravention. Subject to
the satisfaction of the closing conditions set forth in
Section 10 and the other terms and conditions hereof, and
except as disclosed in Section 3.3 of the Disclosure
Schedules, the execution and delivery by such Seller of this
Agreement and the other Transaction Agreements to which it is a
party and the performance of such Seller’s obligations
hereunder and thereunder shall not result in: (
i) the
violation of (
A) any Law applicable to such Seller,
(
B) any material contract to which such Seller is bound
or (
C) the Governing Documents of such Seller, except for
such violations that would not reasonably be expected to
materially impair or delay such Seller’s ability to perform
its obligations under this Agreement and the other Transaction
Agreements to which it is a party or consummate the transactions
contemplated hereby or thereby; or (
ii) the imposition of
any Lien upon any of the Interests owned by such Seller (other
than Liens created by actions of the Buyer or any of its
Affiliates).
3.4
Brokers’ Fees. Each of
RRP, Trust I, Trust III, Trust IV and B Fund is
party to an agreement with Xxxxx Xxxxxx & Co.
requiring the payment of fees in connection with the
transactions contemplated by this Agreement for which the Buyer
shall not be liable or obligated. The Sellers have no Liability
or obligation to pay any fees or commissions to any other
broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which the Buyer could become
liable or obligated.
3.5
No Other Business Activities of the
Companies. Except as set forth on
Schedule 3.5(a), the Olinda Companies have not
engaged in any business or investment activities other than the
Olinda Project as currently conducted and the Olinda Expansion
as set forth on
Annex 4. Except as set
forth on
Schedule 3.5(b), the
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Providence Companies have not engaged in any business or
investment activities other than the Providence Project as
currently conducted and the Providence Expansion as set forth on
Annex 6.
3.6
Consent Statement. No Consent
Statement will (
i) at the time of the mailing of such
Consent Statement to the holders of Equity Interests of
Trust I, Trust III, Trust IV, or B Fund, as
applicable, or (
ii) at the time of the expiration of the
solicitation period for the applicable Consent Solicitation,
including any extension(s) thereof, for such Seller, after
giving effect to any amendments thereof or supplements to such
Consent Statement, contain any untrue statement of a material
fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading;
provided, that no representation is made by
any such Seller with respect to information supplied by or
related to, or the sufficiency of disclosures related to, Buyer
or its Affiliates to the extent such information was supplied by
Buyer for purposes of inclusion in such Consent Solicitation. At
the time the consent solicitation period expires for the Consent
Solicitations for Trust III and Trust IV, the
respective Consent Statements for such Consent Solicitations
will comply as to form in all material respects with the
requirements of the Exchange Act.
3.7
Investment Company Act. No
Seller is subject to the reporting requirements of the
Investment Company Act of 1940 (including any requirement to
file as an investment company thereunder).
4
Representations and Warranties of Trust I as
to the Olinda Companies. Trust I makes
the representations and warranties set forth in Section 4.1
through Section 4.19 below to the Buyer, as of the date
hereof and as of the Closing Date, except to the extent such
representations and warranties are given as of a particular date
or period and relate solely to such particular date or period.
4.1
Organization of the Olinda
Companies. Each of the Olinda Companies and
its respective jurisdiction of organization is identified in
Section 4.1 of the Disclosure Schedules. Each of the Olinda
Companies is: (
i) duly organized, validly existing, and
in good standing under the laws of its jurisdiction of
organization; (
ii) has all requisite power and authority
(whether limited liability company, limited partnership,
corporate, or otherwise) to carry on its business as currently
conducted; and (
iii) is duly qualified to do business in
each jurisdiction in which the ownership, operation or leasing
of its property or the conduct of its business as currently
conducted requires it to be qualified, except, in the cases of
clause (iii), where the failure to be so qualified would not
reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect. Copies of the Governing
Documents of the Olinda Companies, as amended and in effect on
the date hereof and on the Closing Date, have been made
available to the Buyer and are complete in all material respects.
(a) The authorized Equity Interests of Brea Parent consists
of membership interests which are expressed as percentages.
Trust I owns beneficially and of record and has good and
valid title (free and clear of all Liens) to all of the Equity
Interests of Brea Parent, and Brea Parent owns, directly or
indirectly, all of the Equity Interests (free and clear of all
Liens) of each of the Olinda Companies other than Brea Parent
(together with the Brea Parent Interests, the “Olinda
Company Interests”). The Olinda Company Interests
constitute all of the issued and outstanding Equity Interests of
the Olinda Companies as of the date hereof and are free and
clear of all Liens, and the Olinda Company Interests will
constitute all of the issued and outstanding Equity Interests of
the Olinda Companies as of the Closing Date and will be free and
clear of all Liens. The Olinda Company Interests have been duly
authorized and validly issued, are fully paid and nonassessable,
and were issued free of any preemptive or other similar rights.
(b) Other than the Olinda Company Interests held by
Trust I and by other Olinda Companies, as of the date
hereof, no Person owns or holds any interest in the profits or
losses of any of the Olinda Companies, any rights to affect the
management of any of the Olinda Companies, or any rights to
receive distributions from any of the Olinda Companies, and as
of the Closing Date, other than the Olinda Company Interests
held by Trust I and by other Olinda Companies and except as
contemplated by this Agreement, no Person will own or hold any
interest in the profits or losses of any of the Olinda
Companies, any rights to affect the management of any of the
Olinda Companies or any rights to receive distributions from any
of the Olinda Companies.
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There are no equity holder agreements, voting trusts, proxies,
commitments, or other agreements or understandings relating to
the issuance, sale, or transfer of any Equity Interests of any
Olinda Company, other than this Agreement and the Governing
Documents of each of the Olinda Companies.
(c) There are no outstanding Options issued or granted by,
or binding upon, either Trust I or any of the Olinda
Companies for any Person to purchase or sell or otherwise
acquire or dispose of any Equity Interests of any of the Olinda
Companies, other than the Buyer’s rights under this
Agreement.
(a) Section 4.3(a) of the Disclosure Schedules lists
all Assets consisting of real property owned, leased or licensed
by the Olinda Companies. Except as set forth in
Section 4.3(a) of the Disclosure Schedules, the Olinda
Companies have good and marketable title or valid leasehold or
license interests in such real property, free and clear of all
Liens other than Permitted Encumbrances.
(b) Except as set forth on Section 4.3(b) of the
Disclosure Schedules, all of the Assets consisting of material
personal property located at the Sites of the Olinda Project,
other than such property belonging to contractors pursuant to
one or more contracts, are owned of record or leased by the
Olinda Companies with good and marketable title or valid
leasehold interests, free and clear of all Liens other than
Permitted Encumbrances.
(c) Except as set forth on Section 4.3(c) of the
Disclosure Schedules, the Olinda Companies have good and
marketable title to, or a valid leasehold or license interest
in, all properties and assets used by them, located on their
premises (other than such property belonging to contractors
pursuant to one or more contracts) or shown on the Olinda
Balance Sheet and all such properties and assets acquired after
the dates thereof, free and clear of all Liens (other than
properties and assets disposed of for fair value in the ordinary
course of business since such balance sheet date that are not
material for the operation of the business of the Olinda
Companies as currently conducted or as proposed to be conducted
by the Olinda Expansion), other than Permitted Encumbrances. The
Olinda Companies own, have a valid leasehold interest in or have
the valid and enforceable right to use all assets necessary for
the conduct of its business as presently conducted and as
presently proposed to be conducted (including with respect to
the Olinda Expansion taking into account the current status of
the Olinda Expansion). Immediately following the Closing, Buyer
will own and have good and marketable title to, or a valid
leasehold interest in or the valid and enforceable right to use,
all of the properties and assets (free and clear of all Liens,
other than Liens created by Buyer) that were used by the Olinda
Companies to generate the financial results reflected in the
audited financial statements of the Olinda Companies as of and
for the period ended December 31, 2009 and in the Olinda
Balance Sheet.
(d) Except as set forth on Section 4.3(d) of the
Disclosure Schedules, all of the Olinda Companies buildings
(including all components of such buildings, structures and
other improvements), equipment, machinery, fixtures,
improvements and other tangible assets (whether owned or leased)
are in good operating condition and repair (normal wear and tear
excepted), have been maintained in accordance with Good
Engineering Practices and are fit for use in the ordinary course
of the Olinda Companies business as presently conducted.
(a) Subject to the satisfaction of the closing conditions
set forth in Section 10 and except as disclosed in
Section 4.4(a) of the Disclosure Schedules, the execution
and delivery by Trust I of this Agreement and the other
Transaction Agreements to which Trust I is a party and the
consummation of the transactions contemplated hereby and thereby
shall not result in: (i) the violation of (A) any
Law applicable to any of the Olinda Companies, (B) any
material contract to which any of the Olinda Companies is bound,
or (C) the Governing Documents of any of the Olinda
Companies; or (ii) the imposition of any Lien upon any of
the Olinda Company Interests or Assets owned by any of the
Olinda Companies (other than Permitted Encumbrances and Liens
created by actions of the Buyer or any of its Affiliates).
(b) No consent, approval, or authorization of or filing
with any third party or any Governmental Authority is required
on the part of any of the Olinda Companies in connection with
the execution and
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delivery by Trust I of this Agreement and the other
Transaction Agreements to which Trust I is a party or the
consummation of the transactions contemplated hereby or thereby,
except: (i) filings required with respect to the Federal
Power Act, and (ii) as disclosed in Section 4.4(b)
of the Disclosure Schedules.
(a) Subject to Section 4.5(e), and except as set forth
in Section 4.5(a) of the Disclosure Schedules, none of the
Olinda Companies is in material default or violation of any
term, condition, or provision of any Permit or Law applicable to
the Olinda Companies.
(b) Subject to Section 4.5(e), Section 4.5(b) of
the Disclosure Schedules sets forth all Permits necessary (in
accordance with Good Engineering Practices) for the operation of
the Olinda Operating Business as currently conducted and the
Olinda Companies hold all such Permits, unless otherwise
specified in Section 4.5(b) of the Disclosure Schedules.
All Permits required to be identified in Section 4.5(b) and
which have been issued to any Olinda Company are in full force
and effect. Except as set forth in Section 4.5(b) of the
Disclosure Schedules, the Olinda Companies have complied with
all terms of all such Permits and there are no circumstances of
which Trust I or the Olinda Companies have Knowledge that
indicate that any such Permit will or is likely to be revoked,
suspended, amended, modified, not renewed, or not issued (as
applicable) in whole or in part.
(c) Subject to Section 4.5(e), to the Knowledge of
Trust I, Section 4.5(c) of the Disclosure Schedules
sets forth all Permits required to be obtained (in accordance
with Good Engineering Practices) in order to construct and
operate the Olinda Expansion in accordance with
Annex 4. The Olinda Companies have submitted all
applications for such Permits, unless otherwise specified in
Section 4.5(c) of the Disclosure Schedules. All Permits
required to be identified in Section 4.5(c) and which have
been issued to any Olinda Company are in full force and effect.
Except as set forth in Section 4.5(c) of the Disclosure
Schedules, there are no circumstances to the Knowledge of
Trust I or the Olinda Companies that indicate that any such
Permit that (a) has been issued, will, or is likely to,
be revoked, suspended, amended, modified, not renewed, or not
issued (as applicable) in whole or in part, or (b) has
not been issued, will not be issued in a timely manner taking
account of the present schedule for completion of the Olinda
Expansion.
(d) Subject to Section 4.5(e), and except as set forth
in Section 4.5(d) of the Disclosure Schedules, since
May 31, 1997, none of the Olinda Companies has received any
written notice of any violation of any Law or Permit applicable
to it, and to Trust I’s or the Olinda Companies’
Knowledge, no investigations by Government Authorities of any
alleged violation are pending.
(e) The representations and warranties contained in this
Section 4.5 shall not apply to: (i) employee
benefits matters, which are instead the subject of
Section 4.9; (ii) environmental matters, which are
instead the subject of Section 4.10; and (iii) tax
matters, which are instead the subject of Section 4.14.
(f) Since May 31, 1997: (i) the Olinda
Companies have been in, and continue to be in, compliance with
the FPA and the regulations promulgated thereunderwith respect
to the Olinda Operating Business; (ii) the Olinda Project
is and always has been a qualifying facility meeting the
criteria of 18 C.F.R. §§ 292.203(a),
292.601(a), 292.602(a); and (iii) all filings with FERC,
the Department of Energy, or any other Governmental Authority by
or on behalf of the Olinda Companies were true and accurate in
all respects at the time of filing.
(g) (i) Copies of all Permits issued to any of the
Olinda Companies and identified in Section 4.5 of the
Disclosure Schedules have been made available to Buyer, and
(ii) copies of applications for Permits (that are
required to be identified in Section 4.5 of the Disclosure
Schedules) that have been filed by any of the Olinda Companies
and with respect to which Permits have not yet been issued have
been made available to Buyer.
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(a) Section 4.6(a) of the Disclosure Schedules sets
forth a true, correct, and complete list of the following types
of contracts to which any of the Olinda Companies is a party or
by which any of the Olinda Companies is bound (together, the
“Olinda Project Contracts”):
(i) contracts or group of related contracts with the same
party or group of affiliated parties requiring payments by or to
any of the Olinda Companies in excess of $100,000;
(ii) contracts with the Sellers or any Affiliate of the
Sellers other than any of the Olinda Companies;
(iii) contracts pursuant to which any Olinda Company has
been granted landfill gas rights;
(iv) contracts providing for the purchase or sale of
capacity, energy, ancillary services, environmental attributes
or any other similar products;
(v) electric transmission and interconnection contracts;
(vi) contracts relating to the collection, treatment,
transmission and storage of landfill gas;
(vii) outstanding futures, swap, collar, put, call, floor,
cap, option or other contracts that are intended to benefit from
or reduce or eliminate the risk of fluctuations in the price of
commodities, including electric power, fuel or securities;
(viii) contracts for the joint use of facilities requiring
payments thereunder by any party thereto in excess of $100,000
in the aggregate;
(ix) contracts that purport to limit any of the Olinda
Companies’ freedom to compete in any line of business or in
any geographic area;
(x) contracts with any Governmental Authority requiring
payments thereunder by a party thereto in excess of $100,000 in
the aggregate;
(xi) any settlements, conciliations or similar contracts,
the performance of which will involve payment after the
execution of this Agreement of consideration in excess of
$100,000 in the aggregate;
(xii) all contracts conveying, granting, leasing or
assigning an interest in real property or capital equipment to
any of the Olinda Companies requiring payments thereunder by a
party thereto in excess of $100,000;
(xiii) all contracts relating to the purchase or sale of
any of the Olinda Companies
and/or their
Subsidiaries or any business, division, or operation of the
Olinda Companies or their Subsidiaries, or any facilities or
real property of the foregoing requiring payments thereunder by
a party thereto in excess of $100,000 in the aggregate;
(xiv) all contracts which require payment or increased
obligations by or on behalf of any of the Olinda Companies or
any of their Subsidiaries as a result of the transactions
contemplated by this Agreement;
(xv) all contracts and agreements that limit or purport to
limit the ability of any of the Olinda Companies or any of their
Subsidiaries to compete in any line of business or with any
Person or in any geographic area or during any period of time;
(xvi) transmission, interconnection, water supply, energy
marketing, energy management or operations and maintenance
contracts;
(xvii) contracts with respect to Indebtedness or the
mortgaging, pledging or otherwise placing a Lien on any material
Asset or group of Assets of any of the Olinda Companies;
(xviii) contracts with respect to the Olinda Expansion;
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(xix) joint venture contracts, partnership agreements,
limited liability company agreements, or other contracts
(however named) involving a sharing of profits, losses, costs,
or liabilities by any of the Olinda Companies with any other
Person;
(xx) pension, profit sharing, stock option, employee stock
purchase or other plan or arrangement providing for deferred or
other compensation (including any bonuses or other remuneration
and whether in cash or otherwise), to employees, former
employees or consultants, or any other employee benefit plan or
arrangement, or any collective bargaining agreement or any other
contract with any labor union, or severance agreements,
programs, policies or arrangements;
(xxi) contract for the employment of any officer,
individual employee or other Person on a full time, part time,
consulting or other basis or relating to loans to officers,
directors or Affiliates;
(xxii) contract under which any of the Olinda Companies has
advanced or loaned any other Person amounts in the aggregate
exceeding $100,000;
(xxiii) lease or agreement under which any of the Olinda
Companies is lessee of or holds or operates any property, real
or personal, owned by any other party, except for any lease of
real or personal property under which the aggregate annual
rental payments do not exceed $100,000;
(xxiv) lease or agreement under which any of the Olinda
Companies is lessor of or permits any third party to hold or
operate any property, real or personal, owned or controlled by
any of the Olinda Companies;
(xxv) contract or agreements regarding any material
indemnification provided by any of the Olinda Companies, other
than customary indemnification clauses contained in any other
contracts referred to in this Section 4.6; and
(xxvi) contracts entered into other than in the ordinary
course of business and not otherwise listed on
Section 4.6(a) of the Disclosure Schedules.
(b) Except as disclosed in Section 4.6(b) of the
Disclosure Schedules, (i) each of the Olinda Project
Contracts (A) is a valid and binding obligation of the
Olinda Company that is a party thereto and (B) assuming
such Olinda Project Contract is a valid and binding obligation
of and enforceable against the other parties thereto, is
enforceable against the Olinda Company that is a party thereto
in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization,
moratorium, or other similar laws relating to or affecting
creditors generally and subject to general principles of equity,
in each case as now or hereafter in effect, (ii) none of
the Olinda Companies is in breach or default in any material
respect under any such Olinda Project Contract to which it is a
party, (iii) all material contracts necessary for the
Olinda Expansion (other than the Olinda Expansion
Interconnection Agreement) have been obtained and are set forth
on Section 4.6(a) of the Disclosure Schedules, and
(iv) Trust I has no Knowledge of any material breach
of or default under any Olinda Project Contract by any
counterparty thereto. Trust I has made available to the
Buyer a true and correct copy of each of the written
instruments, plans, contracts and agreements and an accurate
description of each of the oral arrangements, contracts and
agreements which are referred to on Section 4.6(a) of the
Disclosure Schedules, together with all amendments, waivers or
other changes thereto.
4.7
Insurance. Section 4.7 of
the Disclosure Schedules sets forth a complete and correct list,
as of the date hereof, of all policies of insurance currently
maintained by RRP or its Affiliates and providing coverage with
respect to the Olinda Companies. Such insurance policies are in
full force and effect and all premiums due with respect to all
periods to and including the Closing Date have either been paid
or adequate provisions for payment have been made. Neither
Trust I nor any of the Olinda Companies has received any
notice of cancellation or non-renewal of any of such insurance
policies.
4.8
Litigation. Except as
disclosed in Section 4.8 of the Disclosure Schedules, and
except as to any matter the subject matter of which is covered
in Sections 4.5 or 4.10, there is no (and there has not
been any for the past five years) action, suit, or proceeding
pending, or to the Knowledge of Trust I or the Olinda
Companies, threatened in writing, against any of the Olinda
Companies.
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(a) None of the Olinda Companies employs any employees. All
Operating Employees of the Olinda Project are employed by RPMC.
Section 4.9(a) of the Disclosure Schedule sets forth a
complete and correct list of the name, date of hire, current job
title, current base salary/wage rate, bonus, commission, or
other remuneration of each Operating Employee of the Olinda
Project as of the date hereof, and designates whether any such
employee is not actively employed as of such date. None of the
Olinda Companies is party to a collective bargaining agreement
with any labor organization. No union has filed a petition to
represent employees of the Olinda Companies with the National
Labor Relations Board or made a demand to bargain with any of
the Olinda Companies. No union organizing efforts are underway
or, to the Knowledge of Trust I or the Olinda Companies,
threatened with respect to the Olinda Companies or the Operating
Employees of the Olinda Project. There is no employment-related
charge of discrimination or complaint pending or, to the
Knowledge of Trust I or the Olinda Companies, threatened in
writing, before any Governmental Authority responsible for
enforcing employment-related Laws related to a violation or
breach (or an alleged violation or breach) of any Law or
contract by the Olinda Companies (or any of their officers or
directors) or with respect to the Operating Employees of the
Olinda Project.
(b) No Plan is sponsored, maintained, participated in, or
directly contributed to by any of the Olinda Companies.
Section 4.9(a) of the Disclosure Schedules sets forth a
list of all Plans in which Operating Employees of the Olinda
Project participate as a result of their service with RPMC (the
“Olinda Operating Employee Plans”).
(c) No Plan sponsored, maintained, contributed to, or
participated in by any entity that, at any relevant time, is or
was treated as a single employer with any of the Olinda
Companies under Code Section 414 (an “Olinda ERISA
Affiliate”), is a “defined benefit plan”
within the meaning of ERISA Section 3(35), a
“multiemployer plan” within the meaning of ERISA
Section 3(37), or any other plan subject to the funding
requirements of Section 412 of the Code or Section 302
of ERISA. Neither the Olinda Companies nor any Olinda ERISA
Affiliate (i) has fully or partially withdrawn from a
multiemployer plan within the past six years or (ii)
otherwise has any liability or potential liability or obligation
pursuant to or under Title IV of ERISA.
(d) Each Qualified Plan has been determined to be so
qualified and has been administered in all material respects in
compliance with its terms, ERISA, the Code and other applicable
Laws.
(e) Except as set forth in Section 4.9(e) of the
Disclosure Schedules, none of the Olinda Companies has any
liability or potential liability or obligation in respect of,
and none of the Olinda Operating Employee Plans provides or
promises to provide, health, medical, or life insurance benefits
attributable to any employee’s post-retirement period,
except for coverage under Code Section 4980B for which the
covered individual pays the full cost of coverage.
(f) Except as set forth on Section 4.9(f) of the
Disclosure Schedules, no Olinda Operating Employee Plan exists
that, as result of the execution of this Agreement (whether
alone or in connection with subsequent events), would result in:
(i) payment by an Olinda Company, Buyer or its Affiliates
of any money or property to any Operating Employee, (ii)
the provision by an Olinda Company, Buyer or its Affiliates of
any benefits or other rights to any Operating Employee, or
(iii) the increase, acceleration, or provision of any
payment, benefit, or other right by an Olinda Company, Buyer or
its Affiliates to any Operating Employee, and none of the Olinda
Companies has any liability or potential liability or obligation
in respect to such payment, provision, increase, or acceleration.
(g) With respect to each Olinda Operating Employee Plan,
all contributions or payments (including all employer
contributions, employee salary reduction contributions and
premium payments) to, by or on behalf of Operating Employees
that are due have been made within the time periods prescribed
by the terms of each such plan (and related contracts), ERISA,
and the Code.
(h) There have been no non-exempt “prohibited
transactions” (as defined in Section 406 of ERISA or
Section 4975 of the Code) and no “fiduciary” (as
defined in Section 3(21) of ERISA) has any liability for
breach of fiduciary duty or any other failure to act or comply
in connection with the administration or
A-26
investment of the assets of a Plan, except, in each case, as
would not result in liability to the Olinda Companies. No
action, investigation, suit, proceeding, hearing or claim with
respect to any Olinda Operating Employee Plan (other than
routine claims for benefits) is pending or, to the Knowledge of
Trust I, threatened that could become a liability of the
Olinda Companies, Buyer or any of the Buyer’s Affiliates.
4.10
Environmental Matters. Except
as set forth in Section 4.10 of the Disclosure Schedules,
and except that with respect to all such matters solely relating
to the period prior to (
i) as to any matter relating to
the gas collection systems constituting part of the Olinda
Project, April 24, 2007, and (
ii) as to any other
matters, May 31, 1997:
(a) the Olinda Companies have operated and are currently
operating the Olinda Operating Business in compliance with all
applicable Environmental Laws;
(b) (i) each of the Olinda Companies has been duly
issued, and maintains, all Permits arising under Environmental
Laws necessary (in accordance with Good Engineering Practices)
for the operation of the Olinda Operating Businessas currently
conducted, and all such Permits are in full force and effect;
(ii) all Permits referred to in clause (i) are
listed on Section 4.10(b)(ii) of the Disclosure Schedules;
and (iii) the Olinda Companies have complied with and are
in compliance with all terms of all Permits referred to in
clause (i) and there are no circumstances of which
Trust I or the Olinda Companies have Knowledge that
indicate that any such Permit will or is likely to be revoked,
suspended, challenged, amended, modified, not renewed, or not
issued (as applicable) in whole or in part;
(c) (i) Section 4.10(c)(i) of the Disclosure
Schedules sets forth all Permits arising under Environmental Law
required to be obtained (in accordance with Good Engineering
Practices) in order to construct and operate the Olinda
Expansion in accordance with Annex 4; (ii) the
Olinda Companies have submitted all applications for all such
Permits referred to in clause (i); (iii) all Permits
referred to in clause (i) which have been issued to any
Olinda Company are in full force and effect; (iv) there
are no circumstances of which Trust I or the Olinda
Companies have Knowledge that indicate that any Permit referred
to in clause (i) that (A) has been issued, will be,
or is likely to be, revoked, suspended, challenged, amended,
modified, not renewed, or not issued (as applicable) in whole or
in part or (B) has not been issued, will not be issued
without challenge in a timely manner taking account of the
present schedule for completion of the Olinda Expansion; and
(v) to Trust I’s or the Olinda Companies’
Knowledge, no investigations by Governmental Authorities of any
alleged violation of Environmental Laws, including any Permit
issued under Environmental Laws, are pending;
(d) none of the Olinda Companies has received any written
notice from any Governmental Authority that it is not in
compliance with Environmental Laws, or failed to obtain,
maintain, or comply with material Permits required for the
ownership or operation of the Olinda Operating Business as
currently conducted, or the ownership or operation of the Olinda
Expansion as proposed to be conducted, under Environmental Laws
applicable to it, in each case, other than with respect to prior
alleged violations, if any, that have been settled and fully
resolved with no additional or continuing obligations to the
Olinda Companies;
(e) none of the Olinda Companies has received any written
notice from any Person alleging Environmental Liabilities or
Liability for any Environmental Claims, other than with respect
to Environmental Liabilities or Environmental Claims that have
been settled and fully resolved with no additional or continuing
obligations to the Olinda Companies;
(f) none of the Olinda Companies has received any written
notice from any Governmental Authority or other Person that any
of its leased real property is listed on the National Priorities
List, under the Comprehensive Environmental Response,
Compensation Liability Information Systems
(“CERCLIS”) or on any similar state list;
(g) no real property leased by any of the Olinda Companies,
and, to the Knowledge of Trust I, no Offsite Disposal
Facility, is listed on the National Priorities List or CERCLIS
or on any similar governmental database or list;
A-27
(h) none of the Olinda Companies has treated, disposed of,
arranged for or permitted the disposal of, transported, handled,
released or exposed any Person to any Hazardous Substance, or
owned or operated any property or facility that is contaminated
by any Hazardous Substance, so as would give rise to
Environmental Liabilities;
(i) except as set forth on Section 4.10(i) of the
Disclosure Schedules, there are no Hazardous Substances that are
stored on the real property leased by any of the Olinda
Companies;
(j) neither this Agreement nor the consummation of the
transaction that is the subject of this Agreement will result in
any obligations for site investigation or cleanup, or
notification to or consent of government agencies or third
parties, pursuant to any of the so-called
“transaction-triggered” or “responsible property
transfer” Environmental Laws;
(k) none of the Olinda Companies has assumed, undertaken,
or provided an indemnity with respect to or otherwise become
subject to, any Environmental Liabilities of any other Person;
(l) none of the Olinda Companies has any Liabilities with
respect to the presence of asbestos, silica or other Hazardous
Substance in any product or item or in or upon any property or
facility; and
(m) the Olinda Companies have made available to the Buyer
copies of all material environmental reports, audits,
assessments, and investigations, and any other material
environmental documents, related to the past or present
facilities, properties or operations of the Olinda Companies, or
any of their respective predecessors, to the extent the
foregoing are in the possession, custody, or control of the
Olinda Companies or Trust I.
Notwithstanding any of the representations and warranties
contained elsewhere in this Agreement, matters arising under
Environmental Laws with respect to the Olinda Companies shall be
governed exclusively by this Section 4.10.
4.11
Condemnation. Except as set
forth in Section 4.11 of the Disclosure Schedules, none of
the Olinda Companies has received a written notice from any
Governmental Authority of any pending or threatened proceeding
to condemn or take by power of eminent domain or otherwise, by
any Governmental Authority, all or any part of the Assets of the
Olinda Companies or property expected to be utilized in the
Olinda Expansion.
4.12
Balance Sheet. Except as set
forth in Section 4.12 of the Disclosure Schedules:
(a) The unaudited consolidated balance sheet of the Olinda
Companies as of April 30, 2010 (the ‘‘Olinda
Balance Sheet”) is set forth on Schedule 4.12(a)
of the Disclosure Schedules. The Olinda Balance Sheet fairly
presents in all material respects the financial condition of the
Olinda Companies on a consolidated basis as of such date and has
been prepared in accordance with GAAP (subject to normal
year-end adjustments and the absence of notes in the case of
interim financial statements, none of which would, alone or in
the aggregate, be materially adverse to the Olinda Project as
currently conducted and as proposed to be conducted by the
Olinda Expansion), applied on a consistent basis (except as may
otherwise be indicated therein).
(b) The Olinda Balance Sheet has been derived from the
financial books and records and operating records of the Olinda
Companies (with respect to the Olinda Project, the Olinda
Operating Business and the Assets of the Olinda Companies). The
financial books and records and operating records in respect of
the Olinda Project, the Olinda Operating Business and the Assets
are true and correct in all material respects and have been
maintained in accordance with the Olinda Companies’
historical policies and procedures.
(c) [Reserved]
(d) Except as set forth on Section 4.12(d)(i) of the
Disclosure Schedule, the accounts receivable shown in the Olinda
Balance Sheet have been paid or, with respect to the unpaid
accounts receivable, are bona fide receivables arising in the
ordinary course of business. Except as set forth on
Section 4.12(d)(ii) of the Disclosure Schedule, no Person
has any Lien on such receivables or any part thereof, and no
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agreement for deduction, free goods, discount or other deferred
price or quantity adjustment has been made with respect to such
receivables. Trust I and the Olinda Companies have no
Knowledge indicating that any unpaid accounts receivable will
not be paid within a period of three (3) months from the
date of the Olinda Balance Sheet (or such longer periods as are
provided for in any contracts applicable thereto) in amounts
equal to their nominal amounts less any specific provision for
bad or doubtful debts included in the Olinda Balance Sheet.
4.13
No Undisclosed
Liabilities. Except as set forth on
Section 4.13 to the Disclosure Schedules, none of the
Olinda Companies has or will have any Liability as of the
Closing, except for Liabilities: (
i) set forth in the
Disclosure Schedules; (
ii) reflected or reserved against
in the Olinda Balance Sheet or set forth in a note thereto;
(
iii) incurred in compliance with the provisions of
Section 8.3; or (
iv) incurred in the ordinary course
of business since the Olinda Balance Sheet (none of which is a
Liability for breach of contract, breach of warranty, tort,
infringement, violation of Law, claim or lawsuit).
4.14
Taxes. Except as set forth in
Section 4.14 of the Disclosure Schedules:
(a) (i) Trust I and Brea Parent have filed, or
caused to be filed, each Tax Return required to have been filed
by, or with respect to, each of the Olinda Companies, and all
such Tax Returns were correct and complete in all material
respects and were prepared in substantial compliance with all
applicable Laws and regulations; (ii) all Taxes due and
payable by any of the Olinda Companies (whether or not shown on
any Tax Return) have been fully paid; (iii) no
examination of any Tax Return of any of the Olinda Companies is
currently in progress or, to the Knowledge of Trust I,
threatened in writing; (iv) there are no outstanding
written agreements, consents, or waivers extending the statutory
period of limitations applicable to any Tax Return of any of the
Olinda Companies; (v) there is no suit, audit, claim, or
assessment pending or, to the Knowledge of Trust I,
proposed to any of the Olinda Companies in writing with respect
to Taxes of any of the Olinda Companies; (vi) there
are no written assessments of Taxes from any taxing authority
against any of the Olinda Companies; and (vii) none of
the Olinda Companies has made any election, pursuant to Treasury
Regulation
Section 301.7701-3,
to be classified as an association for U.S. federal income
Tax purposes; and (viii) no written claim has ever been
made by an authority in a jurisdiction where the Olinda
Companies do not file Tax Returns that any of the Olinda
Companies is or may be subject to taxation by that jurisdiction.
(b) None of the Assets of the Olinda Companies are subject
to any security interest arising in connection with the failure
(or alleged failure) of the Olinda Companies, Trust I, or
any beneficial owner of Trust I to pay Taxes prior to the
due date thereof.
(c) The Olinda Companies and their Affiliates have withheld
and timely paid all taxes required to have been withheld and
paid in connection with any amounts paid or owing to any
employee, independent contractor, creditor, member or other
third party, and all
Forms W-2
and 1099 required with respect thereto have been properly
completed and timely filed.
(d) There is no dispute or claim concerning any Tax
liability of the Olinda Companies that has been claimed or
raised by any Governmental Authority in writing.
(e) [Reserved]
(f) None of the Olinda Companies is a party to any
agreement , contract or arrangement or plan that has resulted or
could result, separately or in the aggregate, in the payment of
(i) any “excess parachute payment” within the
meaning of Code 280G (or any corresponding provision of state,
local or non-US Tax law) and (ii) any amount that
will not be fully deductible as a result of Code 162(m) (or any
corresponding provision of state, local, or
non-U.S. Tax
law).
(g) The unpaid Taxes of the Olinda Companies (i) did
not as of April 30, 2010, exceed the reserve for Tax
liability (other than any reserve for deferred Taxes established
to reflect timing differences between book and Tax income) set
forth on the face of the Olinda Balance Sheet (rather than in
the notes thereto) and (ii) does not exceed the reserve
as adjusted for the passage of time through the Closing Date in
accordance with past custom and practice of the Olinda Companies
in filing their Tax Returns. Since
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the Balance Sheet Date, none of the Olinda Companies has
incurred any liability for Taxes arising from extraordinary
gains or losses, as that term is used in GAAP, outside the
ordinary course of business consistent with past practice.
(h) None of the Olinda Companies will be required to
include any item of income in, or exclude any item of deduction
from, taxable income for any taxable period or portion thereof
ending after the Closing Date as a result of any: (i)
change in method of accounting for a taxable period ending on or
prior to the Closing Date; (ii) “closing
agreement” as described in Code 7121 (or any corresponding
or similar provision of state, local, or non-US income Tax law)
executed on or prior to the Closing Date; (iii)
installment sale or open transaction disposition made on or
prior to the Closing Date; or (iv) prepaid amount
received on or prior to the Closing Date.
(i) None of the Olinda Companies is or has been a party to
any “reportable transaction” as defined in Code
6707A(c)(1) and Reg. 1.6011-4(b).
(a) Section 4.15(a) of the Disclosure Schedules sets
forth: (i) all patents, registered trademarks and other
material items of Intellectual Property owned by or used by the
Olinda Companies in the Olinda Operating Business and sets forth
for each whether such patent, registered trademark or other
material item of Intellectual Property is owned or used by the
Olinda Companies under license; and (ii) a complete and
accurate list of all material licenses and other material rights
granted by each of the Olinda Companies to any Person with
respect to any Intellectual Property rights, and all material
licenses and other material rights (except for
“shrink-wrap” licenses and similar licenses associated
with computer software) granted by any Person to any of the
Olinda Companies with respect to any Intellectual Property
rights, in each case identifying the subject Intellectual
Property rights. The Olinda Companies own, or have the right to
use, all material Intellectual Property relating to or used in
the conduct of the Olinda Operating Business as currently
conducted and as currently proposed to be conducted.
(b) Except as set forth in Section 4.15(b) of the
Disclosure Schedule: (i) none of the Olinda Companies has
received any notices of, and, to the Knowledge of Trust I,
there are no facts that indicate a likelihood of, any
infringement or misappropriation by, or conflict with, any
Person with respect to any Intellectual Property rights used in
the Olinda Operating Business or contemplated to be used in the
Olinda Expansion; (ii) none of the Olinda Companies has
received any demand, request or offer to license patent or other
Intellectual Property rights from any Person; (iii) the
conduct of the Olinda Operating Business as currently conducted
and the conduct of the Olinda Expansion as currently proposed to
be conducted has not infringed, misappropriated or conflicted
with and does not infringe, misappropriate or conflict with any
Intellectual Property rights of any Person, and there have been
no claims made against, or written notices provided to
Trust I or any of the Olinda Companies asserting that
Trust I or any of the Olinda Companies is infringing,
misappropriating, or otherwise conflicting with the Intellectual
Property rights of any Person; and (iv) to the Knowledge
of Trust I and the Olinda Companies, the Intellectual
Property rights owned by or licensed in connection with the
Olinda Operating Business have not been infringed,
misappropriated or conflicted by any Person.
(c) Except as set forth in Section 4.15(c) of the
Disclosure Schedules, neither Trust I nor the Olinda
Companies have received any notice of breach or termination in
relation to any Intellectual Property license used by the Olinda
Companies in the Olinda Operating Business or expected to be
used in the Olinda Expansion.
(d) The Olinda Companies have at all times materially
complied with the terms of all Intellectual Property licenses
and have committed no breach which would permit the contracting
party to terminate or alter the terms of the license, or to
claim indemnification, damages, increased royalties or any other
type of monetary or nonmonetary compensation from the Olinda
Companies. None of the Olinda Companies (i) are currently
in breach of any Intellectual Property license to which it is a
party or are aware of any third party allegation that the Olinda
Companies are in breach of the same, and (ii) are aware of
any known or threatened material breach by the contracting party
of any such license.
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(e) To the Knowledge of Trust I, the transactions
contemplated by this Agreement will not have an adverse effect
on the right, title and interest of any of the Olinda Companies
or Trust I in and to the material Intellectual Property
owned or licensed by it for use in the Olinda Operating Business
or the Olinda Expansion, including, without limitation, the
Intellectual Property rights and licenses listed on
Schedule 4.15(a), and all of such material Intellectual
Property rights shall be owned or otherwise available for use by
the Buyer on substantially identical terms and conditions
immediately following the Closing.
4.16
Bankruptcy; Solvency. None of
the Olinda Companies has applied for or is currently applying
for, has consented or is currently consenting to, or has
acquiesced in or is currently acquiescing in the appointment of
a trustee, receiver or custodian of its assets, or the
initiation of a bankruptcy, reorganization, debt arrangement,
moratorium or any other proceeding under bankruptcy Laws, nor
has there been or is currently existing any appointment of a
trustee, receiver or custodian of such Company’s assets, or
the initiation of a bankruptcy, reorganization, debt
arrangement, moratorium or any other proceeding under bankruptcy
Laws.
4.17
Treasury Grant. Construction
(within the meaning of the Treasury Guidance) with respect to
the Olinda Expansion did not commence before January 1,
2009.
4.18
Absence of Certain
Developments. Except as set forth on
Section 4.18 of the Disclosure Schedules, since
December 31, 2009, (
i) each of the Olinda Companies
has been operated in the ordinary course of business and in
compliance with Good Engineering Practices consistent with past
practice, (
ii) there has not been a Material Adverse
Effect, and (
iii) none of the Olinda Companies has
(except in connection with an Emergency Situation as
contemplated by Section 8.3):
(a) suffered any extraordinary losses or waived any rights
of material value (whether or not in the ordinary course of
business or consistent with past practice) in excess of $100,000
in the aggregate; or
(b) suffered any damage, destruction or casualty loss
exceeding in the aggregate $250,000, whether or not covered by
insurance.
4.19
Bank Accounts. Set forth on
Section 4.19 of the Disclosure Schedule is a list of each
bank account of any of the Olinda Companies (specifying for each
such account any Person with power over such account).
5
Representations and Warranties of the Providence
Sellers as to the Providence Companies. Each
of the Providence Sellers makes the representations and
warranties set forth in Section 5.1 through
Section 5.19 below to the Buyer, as of the date hereof and
as of the Closing Date, except to the extent such
representations and warranties are given as of a particular date
or period and relate solely to such particular date or period,
in each case with respect to itself and not with respect to any
other Providence Seller.
5.1
Organization of the Providence
Companies. Each of the Providence Companies
and its respective jurisdiction of organization is identified in
Section 5.1 of the Disclosure Schedules. Each of the
Providence Companies is: (i) duly organized, validly
existing, and in good standing under the laws of its
jurisdiction of organization, (ii) has all requisite power
and authority (whether limited liability company, limited
partnership, corporate, or otherwise) to carry on its business
as currently conducted, and (iii) is duly qualified to do
business in each jurisdiction in which the ownership, operation
or leasing of its property or the conduct of its business as
currently conducted requires it to be qualified, except, in the
cases of clause (iii), where the failure to be so qualified
would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect. Copies of the
Governing Documents of the Providence Companies, as amended and
in effect on the date hereof and on the Closing Date, have been
made available to the Buyer and are complete in all material
respects.
(a) The Providence Sellers own beneficially and of record
and have good and valid title (free and clear of all Liens) to
all of the RILG Interests, and RILG owns, directly or
indirectly, all of the Equity Interests (free and clear of all
Liens) of each of the Providence Companies other than RILG
(together with the RILG Interests, the “Providence
Company Interests”). The Providence Company Interests
constitute all of the issued and outstanding Equity Interests of
the Providence Companies as of the date hereof and are free and
clear of all Liens, and the Providence Company Interests will
constitute all of the issued and outstanding Equity
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Interests of the Providence Companies as of the Closing Date and
will be free and clear of all Liens (in each case other than
those created by this Agreement or set forth in
Section 5.2(a) of the Disclosure Schedules). The Providence
Company Interests have been duly authorized and validly issued,
are fully paid and nonassessable, and were issued free of any
preemptive or other similar rights.
(b) Other than the Providence Company Interests held by the
Providence Sellers and by other Providence Companies, as of the
date hereof, no Person owns or holds any interest in the profits
or losses of any of the Providence Companies, any rights to
affect the management of any of the Providence Companies, or any
rights to receive distributions from any of the Providence
Companies, and as of the Closing Date, other than the Providence
Company Interests held by the Providence Sellers and by other
Providence Sellers and except as contemplated by this Agreement,
no Person will own or hold any interest in the profits or losses
of any of the Providence Companies, any rights to affect the
management of any of the Providence Companies or any rights to
receive distributions from any of the Providence Companies.
There are no equity holder agreements, voting trusts, proxies,
commitments, or other agreements or understandings relating to
the issuance, sale, or transfer of any Equity Interests of any
Providence Company, other than this Agreement and the Governing
Documents of each of the Providence Companies.
(c) There are no outstanding Options issued or granted by,
or binding upon, either any of the Providence Sellers or any of
the Providence Companies for any Person to purchase or sell or
otherwise acquire or dispose of any Equity Interests of any of
the Providence Companies, other than the Buyer’s rights
under this Agreement.
(a) Section 5.3(a) of the Disclosure Schedules lists
all Assets consisting of real property owned or leased by the
Providence Companies. Except as set forth in Section 5.3(a)
of the Disclosure Schedules, the Providence Companies have good
and marketable title to or valid leasehold interests in such
real property, free and clear of all Liens other than Permitted
Encumbrances.
(b) Except as set forth on Section 5.3(b) of the
Disclosure Schedules, all of the Assets consisting of material
personal property located at the Sites of the Providence
Project, other than such property belonging to contractors
pursuant to one or more contracts, are owned of record or leased
by the Providence Companies with good and marketable title or
valid leasehold interests, free and clear of all Liens other
than Permitted Encumbrances.
(c) Except as set forth on Section 5.3(c) of the
Disclosure Schedules, the Providence Companies have good and
marketable title to or a valid leasehold in all properties and
assets used by them, located on their premises (other than such
property belonging to contractors pursuant to one or more
contracts) or shown on the Providence Balance Sheet and all such
properties and assets acquired after the dates thereof, free and
clear of all Liens (other than properties and assets disposed of
for fair value in the ordinary course of business since such
balance sheet date that are not material for the operation of
the business of the Providence Companies as currently conducted
or as proposed to be conducted by the Providence Expansion),
other than Permitted Encumbrances. The Providence Companies own,
have a valid leasehold interest in or have the valid and
enforceable right to use all assets necessary for the conduct of
its business as presently conducted and as presently proposed to
be conducted (including with respect to the Providence Expansion
taking into account the current status of the Providence
Expansion). Immediately following the Closing, Buyer will own
and have good and marketable title to, or a valid leasehold
interest in or the valid and enforceable right to use, all of
the properties and assets (free and clear of all Liens, other
than Liens created by Buyer) that were used by the Providence
Companies to generate the financial results reflected in the
audited financial statements of the Providence Companies as of
and for the period ended December 31, 2009 and in the
Providence Balance Sheet.
(d) Except as set forth on Section 5.3(d) of the
Disclosure Schedules, all of the Providence Companies buildings
(including all components of such buildings, structures and
other improvements), equipment, machinery, fixtures,
improvements and other tangible assets (whether owned or leased)
are in good operating condition and repair (normal wear and tear
excepted), have been maintained in accordance with Good
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Engineering Practices and are fit for use in the ordinary course
of the Providence Companies business as presently conducted.
(a) Subject to the satisfaction of the closing conditions
set forth in Section 10 and except as disclosed in
Section 5.4(a) of the Disclosure Schedules, the execution
and delivery by the Providence Sellers of this Agreement and the
other Transaction Agreements to which the Providence Sellers are
parties and the consummation of the transactions contemplated
hereby and thereby shall not result in: (i) the violation
of (A) any Law applicable to any of the Providence
Companies, (B) any material contract to which any of the
Providence Companies is bound, or (C) the Governing
Documents of any of the Providence Companies; or (ii) the
imposition of any Lien upon any of the Providence Company
Interests or Assets owned by any of the Providence Companies
(other than Permitted Encumbrances and Liens created by actions
of the Buyer or any of its Affiliates).
(b) No consent, approval, or authorization of or filing
with any third party or any Governmental Authority is required
on the part of any of the Providence Companies in connection
with the execution and delivery by the Providence Sellers of
this Agreement and the other Transaction Agreements to which the
Providence Sellers are parties or the consummation of the
transactions contemplated hereby or thereby, except: (i)
filings required with respect to the Federal Power Act; and
(ii) as disclosed in Section 5.4(b) of the
Disclosure Schedules.
(a) Subject to Section 5.5(e), and except as set forth
in Section 5.5(a) of the Disclosure Schedules, none of the
Providence Companies is in material default or violation of any
term, condition, or provision of any Permit or Law applicable to
the Providence Companies.
(b) Subject to Section 5.5(e), Section 5.5(b) of
the Disclosure Schedules sets forth all Permits necessary (in
accordance with Good Engineering Practices) for the operation of
the Providence Operating Business as currently conducted and the
Providence Companies hold all such Permits, unless otherwise
specified in Section 5.5(b) of the Disclosure Schedules.
All Permits required to be identified in Section 5.5(b) and
which have been issued to any Providence Company are in full
force and effect. Except as set forth in Section 5.5(b) of
the Disclosure Schedules, the Providence Companies have complied
with all terms of all such Permits and there are no
circumstances of which the Providence Sellers or the Providence
Companies have Knowledge that indicate that any such Permit will
or is likely to be revoked, suspended, amended, modified, not
renewed, or not issued (as applicable) in whole or in part.
(c) Subject to Section 5.5(e), to the Knowledge of the
Providence Sellers, Section 5.5(c) of the Disclosure
Schedules sets forth all Permits required to be obtained (in
accordance with Good Engineering Practices) in order to
construct and operate the Providence Expansion in accordance
with Annex 6. The Providence Companies have
submitted all applications for such Permits, unless otherwise
specified in Section 5.5(c) of the Disclosure Schedules.
All Permits required to be identified in Section 5.5(c) and
which have been issued to any Providence Company are in full
force and effect. Except as set forth in Section 5.5(c) of
the Disclosure Schedules, there are no circumstances to the
Knowledge of the Providence Sellers or the Providence Companies
that indicate that any such Permit that (a) has been
issued, will, or is likely to, be revoked, suspended, amended,
modified, not renewed, or not issued (as applicable) in whole or
in part, or (b) has not been issued, will not be issued
in a timely manner taking account of the present schedule for
completion of the Providence Expansion.
(d) Subject to Section 5.5(e), and except as set forth
in Section 5.5(d) of the Disclosure Schedules, none of the
Providence Companies has received any written notice of any
violation of any Law or Permit applicable to it, and to the
Providence Sellers’ or the Providence Companies’
Knowledge, no investigations by Government Authorities of any
alleged violation are pending.
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(e) The representations and warranties contained in this
Section 5.5 shall not apply to: (i) employee
benefits matters, which are instead the subject of
Section 5.9, (ii) environmental matters, which are
instead the subject of Section 5.10, and (iii) tax
matters, which are instead the subject of Section 5.14.
(f) The Providence Companies have been in, and continue to
be in, compliance with the FPA and the regulations promulgated
thereunder with respect to the Providence Operating Business.
The Providence Project is and always has been a qualifying
facility meeting the criteria of 18 C.F.R.
§§ 292.203(a), 292.601(a), 292.602(a). All
filings with FERC, the Department of Energy, or any other
Governmental Authority by or on behalf of the Providence
Companies were true and accurate in all respects at the time of
filing.
(g) (i) Copies of all Permits issued to any of the
Providence Companies and identified in Section 5.5 of the
Disclosure Schedules have been made available to Buyer, and
(ii) copies of applications for Permits (that are
required to be identified in Section 5.5 of the Disclosure
Schedules) that have been filed by any of the Providence
Companies and with respect to which Permits have not yet been
issued have been made available to Buyer.
(a) Section 5.6(a) of the Disclosure Schedules sets
forth a true, correct, and complete list of the following types
of contracts to which any of the Providence Companies is a party
or by which any of the Providence Companies is bound (together,
the “Providence Project Contracts”):
(i) contracts or group of related contracts with the same
party or group of affiliated parties requiring payments by or to
any of the Providence Companies in excess of $100,000;
(ii) contracts with the Sellers or any Affiliate of the
Sellers other than any of the Providence Companies;
(iii) contracts pursuant to which any Providence Company
has been granted landfill gas rights;
(iv) contracts providing for the purchase or sale of
capacity, energy, ancillary services, environmental attributes
or any other similar products;
(v) electric transmission and interconnection contracts;
(vi) contracts relating to the collection, treatment,
transmission and storage of landfill gas;
(vii) outstanding futures, swap, collar, put, call, floor,
cap, option or other contracts that are intended to benefit from
or reduce or eliminate the risk of fluctuations in the price of
commodities, including electric power, fuel or securities;
(viii) contracts for the joint use of facilities requiring
payments thereunder by any party thereto in excess of $100,000
in the aggregate;
(ix) contracts that purport to limit any of the Providence
Companies’ freedom to compete in any line of business or in
any geographic area;
(x) contracts with any Governmental Authority requiring
payments thereunder by a party thereto in excess of $100,000 in
the aggregate;
(xi) any settlements, conciliations or similar contracts,
the performance of which will involve payment after the
execution of this Agreement of consideration in excess of
$100,000 in the aggregate;
(xii) all contracts conveying, granting, leasing or
assigning an interest in real property or capital equipment to
any of the Providence Companies requiring payments thereunder by
a party thereto in excess of $100,000;
(xiii) all contracts relating to the purchase or sale of
any of the Providence Companies
and/or their
Subsidiaries or any business, division, or operation of the
Providence Companies or their Subsidiaries, or any facilities or
real property of the foregoing requiring payments thereunder by
a party thereto in excess of $100,000 in the aggregate;
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(xiv) all contracts which require payment or increased
obligations by or on behalf of any of the Providence Companies
or any of their Subsidiaries as a result of the transactions
contemplated by this Agreement;
(xv) all contracts and agreements that limit or purport to
limit the ability of any of the Providence Companies or any of
their Subsidiaries to compete in any line of business or with
any Person or in any geographic area or during any period of
time;
(xvi) transmission, interconnection, water supply, energy
marketing, energy management or operations and maintenance
contracts;
(xvii) contracts with respect to Indebtedness or the
mortgaging, pledging or otherwise placing a Lien on any material
Asset or group of Assets of any of the Providence Companies;
(xviii) contracts with respect to the Providence Expansion;
(xix) joint venture contracts, partnership agreements,
limited liability company agreements, or other contracts
(however named) involving a sharing of profits, losses, costs,
or liabilities by any of the Providence Companies with any other
Person;
(xx) pension, profit sharing, stock option, employee stock
purchase or other plan or arrangement providing for deferred or
other compensation (including any bonuses or other remuneration
and whether in cash or otherwise), to employees, former
employees or consultants, or any other employee benefit plan or
arrangement, or any collective bargaining agreement or any other
contract with any labor union, or severance agreements,
programs, policies or arrangements;
(xxi) contract for the employment of any officer,
individual employee or other Person on a full time, part time,
consulting or other basis or relating to loans to officers,
directors or Affiliates;
(xxii) contract under which any of the Providence Companies
has advanced or loaned any other Person amounts in the aggregate
exceeding $100,000;
(xxiii) lease or agreement under which any of the
Providence Companies is lessee of or holds or operates any
property, real or personal, owned by any other party, except for
any lease of real or personal property under which the aggregate
annual rental payments do not exceed $100,000;
(xxiv) lease or agreement under which any of the Providence
Companies is lessor of or permits any third party to hold or
operate any property, real or personal, owned or controlled by
any of the Providence Companies;
(xxv) contract or agreements regarding any material
indemnification provided by any of the Providence Companies,
other than customary indemnification clauses contained in any
other contracts referred to in this Section 5.6; and
(xxvi) contracts entered into other than in the ordinary
course of business and not otherwise listed on
Section 5.6(a) of the Disclosure Schedules.
(b) Except as disclosed in Section 5.6(b) of the
Disclosure Schedules, (i) each of the Providence Project
Contracts (A) is a valid and binding obligation of the
Providence Company that is a party thereto and (B)
assuming such Providence Project Contract is a valid and binding
obligation of and enforceable against the other parties thereto,
is enforceable against the Providence Company that is a party
thereto in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium, or other similar laws relating to or
affecting creditors generally and subject to general principles
of equity, in each case as now or hereafter in effect,
(ii) none of the Providence Companies is in breach or
default in any material respect under any Providence Project
Contract to which it is a party, (iii) all material
contracts necessary for the Providence Expansion (other than the
Providence Expansion Interconnection Agreement) have been
obtained and are set forth on Section 5.6(a) of the
Disclosure Schedules, and (iv) the Providence Seller have
no Knowledge of any material breach of or default under any
Providence Project Contract by any counterparty thereto. The
Providence Sellers have made available to the Buyer a true and
correct copy of each
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of the written instruments, plans, contracts and agreements and
an accurate description of each of the oral arrangements,
contracts and agreements which are referred to on
Section 5.6(a) of the Disclosure Schedules, together with
all amendments, waivers or other changes thereto.
5.7
Insurance. Section 5.7 of
the Disclosure Schedules sets forth a complete and correct list,
as of the date hereof, of all policies of insurance currently
maintained by RRP or its Affiliates and providing coverage with
respect to the Providence Companies. Such insurance policies are
in full force and effect and all premiums due with respect to
all periods to and including the Closing Date have either been
paid or adequate provisions for payment have been made. None of
the Providence Sellers or the Providence Companies has received
any notice of cancellation or non-renewal of any of such
insurance policies.
5.8
Litigation. Except as
disclosed in Section 5.8 of the Disclosure Schedules, and
except as to any matter the subject matter of which is covered
in Sections 5.5 or 5.10, there is no (and there has not
been any for the past five years) action, suit, or proceeding
pending, or to the Knowledge of the Providence Sellers or the
Providence Companies, threatened in writing, against any of the
Providence Companies.
(a) None of the Providence Companies employs any employees.
All Operating Employees of the Providence Project are employed
by RPMC. Section 5.9(a) of the Disclosure Schedule sets
forth a complete and correct list of the name, date of hire,
current job title, current base salary/wage rate, bonus,
commission, or other remuneration of each Operating Employee of
the Providence Project as of the date hereof, and designates
whether any such employee is not actively employed as of such
date. None of the Providence Companies is party to a collective
bargaining agreement with any labor organization. No union has
filed a petition to represent employees of the Providence
Companies with the National Labor Relations Board or made a
demand to bargain with any of the Providence Companies. No union
organizing efforts are underway or, to the Knowledge of the
Providence Sellers or the Providence Companies, threatened with
respect to the Providence Companies or the Operating Employees
of the Providence Project. There is no employment-related charge
of discrimination or complaint pending or, to the Knowledge of
the Providence Sellers or the Providence Companies, threatened
in writing, before any Governmental Authority responsible for
enforcing employment-related Laws related to a violation or
breach (or an alleged violation or breach) of any Law or
contract by the Providence Companies (or any of their officers
or directors) or with respect to the Operating Employees of the
Providence Project.
(b) No Plan is sponsored, maintained, participated in, or
directly contributed to by any of the Providence Companies.
Section 5.9(a) of the Disclosure Schedules sets forth a
list of all Plans in which Operating Employees of the Providence
Project participate as a result of their service with RPMC (the
“Providence Operating Employee Plans”).
(c) No Plan sponsored, maintained, contributed to, or
participated in by any entity that, at any relevant time, is or
was treated as a single employer with any of the Providence
Companies under Code Section 414 (a “Providence
ERISA Affiliate”), is a “defined benefit
plan” within the meaning of ERISA Section 3(35), a
“multiemployer plan” within the meaning of ERISA
Section 3(37), or any other plan subject to the funding
requirements of Section 412 of the Code or Section 302
of ERISA. Neither the Providence Companies nor any Providence
ERISA Affiliate (i) has fully or partially withdrawn from a
multiemployer plan within the past six years or
(ii) otherwise has any liability or potential liability or
obligation pursuant to or under Title IV of ERISA.
(d) Each Qualified Plan has been determined to be so
qualified and has been administered in all material respects in
compliance with its terms, ERISA, the Code and other applicable
Laws.
(e) Except as set forth in Section 5.9(e) of the
Disclosure Schedules, none of the Providence Companies has any
liability or potential liability or obligation in respect of,
and none of the Providence Operating Employee Plans provides or
promises to provide, health, medical, or life insurance benefits
attributable to any employee’s post-retirement period,
except for coverage under Code Section 4980B for which the
covered individual pays the full cost of coverage.
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(f) Except as set forth on Section 5.9(f) of the
Disclosure Schedules, no Providence Operating Employee Plan
exists that, as result of the execution of this Agreement
(whether alone or in connection with subsequent events), would
result in: (i) payment by a Providence Company, Buyer or
its Affiliates of any money or property to any Operating
Employee, (ii) the provision by a Providence Company,
Buyer or its Affiliates of any benefits or other rights to any
Operating Employee, or (iii) the increase, acceleration,
or provision of any payment, benefit, or other right by a
Providence Company, Buyer or its Affiliates to any Operating
Employee, and none of the Providence Companies has any liability
or potential liability or obligation in respect to such payment,
provision, increase, or acceleration.
(g) With respect to each Providence Operating Employee
Plan, all contributions or payments (including all employer
contributions, employee salary reduction contributions and
premium payments) to, by or on behalf of Operating Employees
that are due have been made within the time periods prescribed
by the terms of each such plan (and related contracts), ERISA,
and the Code.
(h) There have been no non-exempt “prohibited
transactions” (as defined in Section 406 of ERISA or
Section 4975 of the Code), and no “fiduciary” (as
defined in Section 3(21) of ERISA) has any liability for
breach of fiduciary duty or any other failure to act or comply
in connection with the administration or investment of the
assets of a Plan, except, in each case, as would not result in
liability to the Providence Companies. No action, investigation,
suit, proceeding, hearing or claim with respect to any
Providence Operating Employee Plan (other than routine claims
for benefits) is pending or, to the Knowledge of the Providence
Sellers, threatened that could become a liability of the
Providence Companies, Buyer or any of the Buyer’s
Affiliates.
(a) the Providence Companies have operated and are
operating the Providence Operating Business in compliance with
all applicable Environmental Laws;
(b) (i) each of the Providence Companies has been
duly issued, and maintains, all Permits arising under
Environmental Laws necessary (in accordance with Good
Engineering Practices) for the operation of the Providence
Operating Business as currently conducted, and all such Permits
are in full force and effect; (ii) all Permits referred
to in clause (i) are listed on Section 5.10(b)(ii) of
the Disclosure Schedules; and (iii) the Providence
Companies have complied and are in compliance with all terms of
all Permits referred to in clause (i) and there are no
circumstances of which the Providence Sellers or the Providence
Companies have Knowledge that indicate that any such Permit will
or is likely to be revoked, suspended, challenged, amended,
modified, not renewed, or not issued (as applicable) in whole or
in part;
(c) (i) Section 5.10(c)(i) of the Disclosure
Schedules sets forth all Permits arising under Environmental Law
required to be obtained (in accordance with Good Engineering
Practices) in order to construct and operate the Providence
Expansion in accordance with Annex 6; (ii) the
Providence Companies have submitted all applications for all
such Permits referred to in clause (i); (iii) all Permits
referred to in clause (i) which have been issued to any
Providence Company are in full force and effect; (iv)
there are no circumstances of which the Providence Sellers or
the Providence Companies have Knowledge that indicate that any
Permit referred to in clause (i) that (A) has been
issued, will be, or is likely to be, revoked, suspended,
challenged, amended, modified, not renewed, or not issued (as
applicable) in whole or in part or (B) has not been
issued, will not be issued without challenge in a timely manner
taking account of the present schedule for completion of the
Providence Expansion; and (v) to the Providence
Seller’s or the Providence Companies’ Knowledge, no
investigations by Governmental Authorities of any alleged
violation of Environmental Laws, including any Permit issued
under Environmental Laws, are pending;
(d) none of the Providence Companies has received any
written notice from any Governmental Authority that it is not in
compliance with Environmental Laws, or failed to obtain,
maintain, or comply with material Permits required for the
ownership or operation of the Providence Operating Business as
currently conducted, or the ownership or operation of the
Providence Expansion as proposed to be conducted, under
Environmental Laws applicable to it, in each case, other than
with respect to prior
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alleged violations, if any, that have been settled and fully
resolved with no additional or continuing obligations to the
Providence Companies;
(e) none of the Providence Companies has received any
written notice from any Person alleging Environmental
Liabilities or Liability for any Environmental Claims, other
than with respect to Environmental Liabilities or Environmental
Claims that have been settled and fully resolved with no
additional or continuing obligations to the Providence Companies;
(f) none of the Providence Companies has received any
written notice from any Governmental Authority or other Person
that any of its leased real property is listed on the National
Priorities List under CERCLIS or on any similar state list;
(g) no real property leased by any of the Providence
Companies, and, to the Knowledge of the Providence Sellers, no
Offsite Disposal Facility, is listed on the National Priorities
List or CERCLIS or on any similar governmental database or list;
(h) none of the Providence Companies has treated, disposed
of, arranged for or permitted the disposal of, transported,
handled, released or exposed any Person to any Hazardous
Substance, or owned or operated any property or facility that is
contaminated by any Hazardous Substance, so as would give rise
to Environmental Liabilities;
(i) except as set forth on Section 5.10(i) of the
Disclosure Schedules, there are no Hazardous Substances that are
stored on the real property leased by any of the Providence
Companies;
(j) neither this Agreement nor the consummation of the
transaction that is the subject of this Agreement will result in
any obligations for site investigation or cleanup, or
notification to or consent of government agencies or third
parties, pursuant to any of the so-called
“transaction-triggered” or “responsible property
transfer” Environmental Laws;
(k) none of the Providence Companies has assumed,
undertaken, or provided an indemnity with respect to or
otherwise become subject to, any Environmental Liabilities of
any other Person;
(l) none of the Providence Companies has any Liabilities
with respect to the presence of asbestos, silica or other
Hazardous Substance in any product or item or in or upon any
property or facility; and
(m) the Providence Companies have made available to the
Buyer copies of all material environmental reports, audits,
assessments, and investigations, and any other material
environmental documents, related to the past or present
facilities, properties or operations of the Providence
Companies, or any of their respective predecessors, to the
extent the foregoing are in the possession, custody, or control
of the Providence Companies or the Providence Sellers.
Notwithstanding any of the representations and warranties
contained elsewhere in this Agreement, matters arising under
Environmental Laws with respect to the Providence Companies
shall be governed exclusively by this Section 5.10.
5.11
Condemnation. Except as set
forth in Section 5.11 of the Disclosure Schedules, none of
the Providence Companies has received a written notice from any
Governmental Authority of any pending or threatened proceeding
to condemn or take by power of eminent domain or otherwise, by
any Governmental Authority, all or any part of the Assets of the
Providence Companies or property expected to be utilized in the
Providence Expansion.
5.12
Balance Sheet. Except as set
forth in Section 5.12 of the Disclosure Schedules:
(a) The unaudited consolidated balance sheet of the
Providence Companies as of April 30, 2010 (the
“Providence Balance Sheet”) is set forth on
Schedule 5.12(a) of the Disclosure Schedules. The
Providence Balance Sheet fairly presents in all material
respects the financial condition of the Providence Companies on
a consolidated basis as of such date and has been prepared in
accordance with GAAP (subject to normal year-end adjustments and
the absence of notes in the case of interim financial
statements, none of which would, alone or in the aggregate, be
materially adverse to the Providence
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Project as currently conducted and as proposed to be conducted
by the Providence Expansion), applied on a consistent basis
(except as may otherwise be indicated therein).
(b) The Providence Balance Sheet has been derived from the
financial books and records and operating records of the
Providence Companies (with respect to the Providence Project,
the Providence Operating Business and the Assets of the
Providence Companies). The financial books and records and
operating records in respect of the Providence Project, the
Providence Operating Business and the Assets are true and
correct in all material respects and have been maintained in
accordance with the Providence Companies’ historical
policies and procedures.
(c) [Reserved]
(d) Except as set forth on Section 5.12(d)(i) of the
Disclosure Schedule, the accounts receivable shown in the
Providence Balance Sheet have been paid or, with respect to the
unpaid accounts receivable, are bona fide receivables arising in
the ordinary course of business. Except as set forth on
Section 5.12(d)(ii) of the Disclosure Schedule, no Person
has any Lien on such receivables or any part thereof, and no
agreement for deduction, free goods, discount or other deferred
price or quantity adjustment has been made with respect to such
receivables. The Providence Sellers and the Providence Companies
have no Knowledge indicating that any unpaid accounts receivable
will not be paid within a period of three (3) months from
the date of the Providence Balance Sheet (or such longer periods
as are provided for in any contracts applicable thereto) in
amounts equal to their nominal amounts less any specific
provision for bad or doubtful debts included in the Providence
Balance Sheet.
5.13
No Undisclosed
Liabilities. Except as set forth on
Section 5.13 to the Disclosure Schedules, none of the
Providence Companies has or will have any Liability as of the
Closing, except for Liabilities: (
i) set forth in the
Disclosure Schedules; (
ii) reflected or reserved against
in the Providence Balance Sheet or set forth in a note thereto;
(
iii) incurred in compliance with the provisions of
Section 8.3; or (
iv) incurred in the ordinary course
of business since the Providence Balance Sheet (none of which is
a Liability for breach of contract, breach of warranty, tort,
infringement, violation of Law, claim or lawsuit).
5.14
Taxes. Except as set forth in
Section 5.14 of the Disclosure Schedules:
(a) (i) The Providence Sellers and RILG have filed,
or caused to be filed, each Tax Return required to have been
filed by, or with respect to, each of the Providence Companies,
and all such Tax Returns were correct and complete in all
material respects and were prepared in substantial compliance
with all applicable Laws and regulations; (ii) all Taxes
due and payable by any of the Providence Companies (whether or
not shown on any Tax Return) have been fully paid; (iii)
no examination of any Tax Return of any of the Providence
Companies is currently in progress or, to the Knowledge of the
Providence Sellers, threatened in writing; (iv) there are
no outstanding written agreements, consents, or waivers
extending the statutory period of limitations applicable to any
Tax Return of any of the Providence Companies; (v) there
is no suit, audit, claim, or assessment pending or, to the
Knowledge of Trust I, proposed to any of the Providence
Companies in writing with respect to Taxes of any of the
Providence Companies; (vi) there are no written
assessments of Taxes from any taxing authority against any of
the Providence Companies; and (vii) none of the
Providence Companies has made any election, pursuant to Treasury
Regulation Section 301.7701-3,
to be classified as an association for U.S. federal income
Tax purposes; and (viii) no written claim has ever been
made by an authority in a jurisdiction where the Providence
Companies do not file Tax Returns that any of the Providence
Companies is or may be subject to taxation by that jurisdiction.
(b) None of the Assets of the Providence Companies are
subject to any security interest arising in connection with the
failure (or alleged failure) of the Providence Companies, the
Providence Sellers, or any beneficial owner of the Providence
Sellers to pay Taxes prior to the due date thereof.
(c) The Providence Companies and their Affiliates have
withheld and timely paid all taxes required to have been
withheld and paid in connection with any amounts paid or owing
to any employee, independent contractor, creditor, member or
other third party, and all
Forms W-2
and 1099 required with respect thereto have been properly
completed and timely filed.
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(d) There is no dispute or claim concerning any Tax
liability of the Providence Companies that has been claimed or
raised by any Governmental Authority in writing.
(e) The Providence Project is a facility that, in
accordance with Code Section 45(d)(6), produces electricity
from gas derived from the biodegradation of “municipal
solid waste” (as such term is defined in Code
Section 45(c)(6)). The Providence Companies have not
received any amount described in Code Section 45(b)(3). The
Caterpillar generators that are part of the Providence Project
were placed in service in 2005.
(f) None of the Providence Companies is a party to any
agreement , contract or arrangement or plan that has resulted or
could result, separately or in the aggregate, in the payment of
(i) any “excess parachute payment” within the
meaning of Code 280G (or any corresponding provision of state,
local or non-US Tax law) and (ii) any amount that will
not be fully deductible as a result of Code 162(m) (or any
corresponding provision of state, local, or
non-U.S. Tax
law).
(g) The unpaid Taxes of the Providence Companies (i)
did not as of April 30, 2010, exceed the reserve for Tax
liability (other than any reserve for deferred Taxes established
to reflect timing differences between book and Tax income) set
forth on the face of the Providence Balance Sheet (rather than
in the notes thereto) and (ii) does not exceed the
reserve as adjusted for the passage of time through the Closing
Date in accordance with past custom and practice of the
Providence Companies in filing their Tax Returns. Since the
Balance Sheet Date, none of the Providence Companies has
incurred any liability for Taxes arising from extraordinary
gains or losses, as that term is used in GAAP, outside the
ordinary course of business consistent with past practice.
(h) None of the Providence Companies will be required to
include any item of income in, or exclude any item of deduction
from, taxable income for any taxable period or portion thereof
ending after the Closing Date as a result of any: (i)
change in method of accounting for a taxable period ending on or
prior to the Closing Date; (ii) “closing
agreement” as described in Code 7121 (or any corresponding
or similar provision of state, local, or non-US income Tax law)
executed on or prior to the Closing Date; (iii)
installment sale or open transaction disposition made on or
prior to the Closing Date; or (iv) prepaid amount
received on or prior to the Closing Date.
(i) None of the Providence Companies is or has been a party
to any “reportable transaction” as defined in Code
6707A(c)(1) and Reg. 1.6011-4(b).
(a) Section 5.15(a) of the Disclosure Schedules sets
forth: (i) all patents, registered trademarks and other
material items of Intellectual Property owned by or used by the
Providence Companies in the Providence Operating Business and
sets forth for each whether such patent, registered trademark or
other material item of Intellectual Property is owned or used by
the Providence Companies under license; and (ii) a
complete and accurate list of all material licenses and other
material rights granted by each of the Providence Companies to
any Person with respect to any Intellectual Property rights, and
all material licenses and other material rights (except for
“shrink-wrap” licenses and similar licenses associated
with computer software) granted by any Person to any of the
Providence Companies with respect to any Intellectual Property
rights, in each case identifying the subject Intellectual
Property rights. The Providence Companies own, or have the right
to use, all material Intellectual Property relating to or used
in the conduct of the Providence Operating Business as currently
conducted and as currently proposed to be conducted.
(b) Except as set forth in Section 5.15(b) of the
Disclosure Schedule: (i) none of the Providence Companies
has received any notices of, and, to the Knowledge of the
Providence Sellers, there are no facts that indicate a
likelihood of, any infringement or misappropriation by, or
conflict with, any Person with respect to any Intellectual
Property rights used in the Providence Operating Business or
contemplated to be used in the Providence Expansion; (ii)
none of the Providence Companies has received any demand,
request or offer to license patent or other Intellectual
Property rights from any Person; (iii) the conduct of the
Providence Operating Business as currently conducted and the
conduct of the Providence Expansion as currently proposed to be
conducted has not infringed, misappropriated or conflicted with
and does not infringe, misappropriate or
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conflict with any Intellectual Property rights of any Person,
and there have been no claims made against, or written notices
provided to the Providence Sellers or any of the Providence
Companies asserting that the Providence Sellers or any of the
Providence Companies is infringing, misappropriating, or
otherwise conflicting with the Intellectual Property rights of
any Person; and (iv) to the Knowledge of the Providence
Sellers and the Providence Companies, the Intellectual Property
rights owned by or licensed in connection with the Providence
Operating Business have not been infringed, misappropriated or
conflicted by any Person.
(c) Except as set forth in Section 5.15(c) of the
Disclosure Schedules, neither the Providence Sellers nor the
Providence Companies have received any notice of breach or
termination in relation to any Intellectual Property license
used by the Providence Companies in the Providence Operating
Business or expected to be used in the Providence Expansion.
(d) The Providence Companies have at all times materially
complied with the terms of all Intellectual Property licenses
and have committed no breach which would permit the contracting
party to terminate or alter the terms of the license, or to
claim indemnification, damages, increased royalties or any other
type of monetary or nonmonetary compensation from the Providence
Companies. None of the Providence Companies (i) are
currently in breach of any Intellectual Property license to
which it is a party or are aware of any third party allegation
that the Providence Companies are in breach of the same, and
(ii) are aware of any known or threatened material breach
by the contracting party of any such license.
(e) To the Knowledge of the Providence Sellers, the
transactions contemplated by this Agreement will not have an
adverse effect on the right, title and interest of any of the
Providence Companies or the Providence Sellers in and to the
material Intellectual Property owned or licensed by it for use
in the Providence Operating Business or the Providence
Expansion, including, without limitation, the Intellectual
Property rights and licenses listed on Schedule 5.15(a),
and all of such material Intellectual Property rights shall be
owned or otherwise available for use by the Buyer on
substantially identical terms and conditions immediately
following the Closing.
5.16
Bankruptcy; Solvency. None of
the Providence Companies has applied for or is currently
applying for, has consented or is currently consenting to, or
has acquiesced in or is currently acquiescing in the appointment
of a trustee, receiver or custodian of its assets, or the
initiation of a bankruptcy, reorganization, debt arrangement,
moratorium or any other proceeding under bankruptcy Laws, nor
has there been or is currently existing any appointment of a
trustee, receiver or custodian of such Company’s assets, or
the initiation of a bankruptcy, reorganization, debt
arrangement, moratorium or any other proceeding under bankruptcy
Laws.
5.17
ITC Treasury
Grant. Construction (within the meaning of
the Treasury Guidance) with respect to the Providence Expansion
did not commence before January 1, 2009.
5.18
Absence of Certain
Developments. Except as set forth on
Section 5.18 of the Disclosure Schedules, since
December 31, 2009, (
i) each of the Providence
Companies has been operated in the ordinary course of business
and in compliance with Good Engineering Practices consistent
with past practice, (
ii) there has not been a Material
Adverse Effect, and (
iii) none of the Providence
Companies has (except in connection with an Emergency Situation
as contemplated by Section 8.3):
(a) suffered any extraordinary losses or waived any rights
of material value (whether or not in the ordinary course of
business or consistent with past practice) in excess of $100,000
in the aggregate; or
(b) suffered any damage, destruction or casualty loss
exceeding in the aggregate $250,000, whether or not covered by
insurance.
5.19
Bank Accounts. Set forth on
Section 5.19 of the Disclosure Schedule is a list of each
bank account of any of the Providence Companies (specifying for
each such account any Person with power over such account).
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6 [Reserved]
7.1
Organization of the Buyer. The
Buyer is duly organized, validly existing, and in good standing
under the laws of the State of Delaware.
7.2
Authorization of
Transaction. The Buyer has the full power and
authority to execute and deliver this Agreement and the other
Transaction Agreements to which it is a party and perform its
obligations hereunder and thereunder. The execution and delivery
by the Buyer of this Agreement and the other Transaction
Agreements to which it is a party and the performance of the
Buyer’s obligations hereunder and thereunder have been duly
authorized by all necessary action on the part of the Buyer. The
Buyer has duly executed and delivered this Agreement and, as of
the Closing Date, will have executed and delivered the other
Transaction Agreements to which it is a party, and this
Agreement constitutes, and each such Transaction Agreement when
so executed and delivered will constitute, the valid and binding
obligation of the Buyer, enforceable against the Buyer in
accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium,
or other similar Laws relating to or affecting creditors
generally, and subject to general principles of equity
(regardless of whether enforcement thereof is in a proceeding at
law or in equity), in each case as now or hereafter in effect.
(a) Subject to the satisfaction of the closing conditions
set forth in Section 10 and the other terms and conditions
hereof, the execution and delivery by the Buyer of this
Agreement and the other Transaction Agreements to which it is a
party and the performance of the Buyer’s obligations
hereunder and thereunder shall not result in the violation of:
(i) any Law applicable to the Buyer; (ii) any
material contract to which the Buyer is bound; or (iii)
the Governing Documents of the Buyer, except for such violations
as would not reasonably be expected to materially impair or
delay the Buyer’s ability to perform its obligations under
this Agreement and the other Transaction Agreements to which it
is a party or consummate the transactions contemplated hereby or
thereby.
(b) No consent, approval or authorization of or filing with
any third party or any Governmental Authority is required on the
part of the Buyer in connection with the execution and delivery
of this Agreement and the other Transaction Agreements to which
the Buyer is a party or the consummation by Buyer of the
transactions contemplated hereby or thereby, except: (i)
filings required with respect to the Federal Power Act; and
(ii) consents, approvals, authorizations, or filings
which, if not made or obtained, would not reasonably be expected
to materially impair or delay the Buyer’s ability to
perform its obligations under this Agreement and the other
Transaction Agreements to which it is a party or consummate the
transactions contemplated hereby or thereby.
7.4
Brokers’ Fees. The Buyer
has no Liability or obligation to pay any fees or commissions to
any other broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the
Sellers could become liable or obligated.
7.5
Litigation. No action, suit,
claim, demand, or other proceeding is pending or, to the
Buyer’s Knowledge, threatened that (
i) would be
reasonably likely to materially impair or delay the Buyer’s
ability to perform its obligations under this Agreement or any
other Transaction Agreement to which it is a party or consummate
the transactions contemplated hereby or thereby or (
ii)
questions the validity of this Agreement or any other
Transaction Agreement or of any action taken or to be taken
pursuant to or in connection with the provisions hereof or
thereof.
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7.6 [Reserved]
(a) Attached as Section 7.7(a) of the Disclosure
Schedules is a true and complete copy of the Equity Commitment
Letter. The Equity Commitment Letter is a legal, valid and
binding obligation of Buyer and the Sponsors. Subject to its
terms and conditions, the aggregate proceeds to be disbursed
pursuant to the Equity Commitment Letter would provide Buyer
with cash proceeds at the Closing sufficient to make the
payments required by Section 2.
(b) Attached as Section 7(b) of the Disclosure
Schedules is a copy of the draft debt financing term sheet
entitled “Project Xxxx — Outline of Terms and
Conditions” dated as of June 22, 2010 (the
“Debt Term Sheet”).
8
Covenants of the Sellers. Each
Seller hereby covenants and agrees, solely with respect to
itself, the Parent Company the Interests of which it is selling
to the Buyer (and, where applicable, such Parent Company’s
subsidiaries and the Project owned and operated by such
entities), or such Interests, as the case may be, and not with
respect to any other Seller, Company, Project, or Interest, as
follows:
8.1 General. Prior to the Closing,
each Seller shall use commercially reasonable efforts to effect
the consummation of the transactions contemplated by this
Agreement as soon as practicable (including giving all required
notices to third parties and obtaining all required third-party
consents as may be required for the satisfaction, but not
waiver, of the closing conditions set forth in Section 10).
8.2 Notices, Consents and Approvals.
(a) FERC. Each Seller shall
cooperate with the Buyer to jointly prepare and file, or cause
to be filed, as promptly as practicable after the date hereof,
with FERC any application required to be filed pursuant to
Section 203(a) of the Federal Power Act, requesting
approval for the transactions contemplated hereby to the extent
required.
(b) Consent Statement(s)/Consent
Solicitations. As promptly as reasonably
practicable after the date hereof (and no later than ten
(10) Business Days following the date hereof), the
Sellers’ Representative shall prepare, or cause to be
prepared, and in the case of Trust III and Trust IV
(also no later than ten (10) Business Days following the
date hereof) file with the SEC, consent statements to be sent to
the holders of shares of each of Trust I, Trust III,
Trust IV and B Fund in connection with each such
Seller’s Consent Solicitation (together with any amendments
thereof or supplements thereto, the “Consent
Statements” and each a “Consent
Statement”). The Sellers’ Representative, after
consultation with Buyer, will use commercially reasonable
efforts to respond promptly to any comments made by the staff of
the SEC with respect to the Consent Statements that are filed
with the SEC. Without limiting the generality of the foregoing,
(x) prior to filing any Consent Statement (or any
amendment or supplement thereto) with the SEC or responding to
any comments of the staff of the SEC with respect thereto, the
Sellers’ Representative shall (A) give Buyer a
reasonable opportunity to review and comment on such documents
or response and (B) include such documents or response
comments reasonably and promptly proposed by Buyer, and
(y) Buyer shall promptly furnish all information relating
to Buyer and its Affiliates as the Sellers’ Representative
may reasonably request (or as may be required in the sole, but
reasonable, judgment of the Sellers’ Representative to be
included in the Consent Statements) in connection with such
actions and the preparation of the Consent Statements, except
for information that is confidential, proprietary or
commercially sensitive to the Buyer’s business. Provided
the Sellers’ Representative has not made a Financing Delay
Determination under Section 8.11(c) and this Agreement has
not been terminated in accordance with Section 13.1, then,
subject to applicable Law, as promptly as reasonably practicable
after the staff of the SEC indicate they have no further
comments regarding any of the Consent Statements filed with the
SEC by the Sellers’ Representative (but in any event within
five (5) Business Days thereafter), the Sellers’
Representative shall mail or cause to be mailed all of the
Consent Statements (whether or not filed with the SEC) to the
respective holders of Equity Interests of each of Trust I,
Trust III, Trust IV and B Fund for the purpose of
obtaining the Shareholder Approval for each such Seller (the
“Consent Solicitations” and each a
“Consent Solicitation”). Subject to
Section 8.8,
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each of the Consent Statements shall include the recommendation
of the managing shareholder of the applicable Seller
recommending to the shareholders of such Seller the approval and
adoption of this Agreement and the other agreements contemplated
hereby and the transactions contemplated hereby and thereby
(each such recommendation with respect to the shareholders of
Trust I, Trust III, Trust IV or B Fund regarding
the sale of the Providence Company Interests, a
“Providence Recommendation” and the
recommendation with respect to the shareholders of Trust I
regarding the sale of the Olinda Company Interests, the
“Olinda Recommendation” and together with the
Providence Recommendation, the
“Recommendations”). The Sellers’
Representative will advise Buyer, as promptly as practicable,
after it receives notice thereof, of any request by the staff of
the SEC for amendment of any Consent Statement filed with the
SEC or comments thereon and responses thereto or requests by the
staff of the SEC for additional information. If at any time
prior to the Closing, any information, event or circumstance
relating to any party hereto, or their respective officers,
directors, Affiliates or Representatives, should be discovered
by any party hereto (as it relates to such party) that may
reasonably be required to be set forth in an amendment or
supplement to one or more of the Consent Statements so that such
Consent Statements do not contain any untrue statement of
material fact, or omit to state any material fact required to be
stated therein in order to make the statements therein, in light
of the circumstances under which they were made, not misleading,
the party discovering such information, event or circumstance
shall promptly inform the other parties hereto and, to the
extent required by Law in the sole judgment of the Sellers’
Representative, an appropriate amendment or supplement
describing such information, event or circumstances shall be
promptly prepared, and with respect to Trust III or
Trust IV filed by the Sellers’ Representative with the
SEC, and, if required, disseminated to the holders of shares of
Trust I, Trust III, Trust IV or B Fund (as
applicable).
(c) Prior to the Closing, each Seller shall cooperate with
the Buyer and use commercially reasonable efforts to: (i)
promptly prepare, support, assist in preparing, join in, and
file any filings, applications, and all other necessary
documentation; (ii) effect all necessary applications,
notices, petitions, and filings, and execute all agreements and
documents; and (iii) obtain and not oppose, directly or
indirectly, all necessary consents, approvals, and
authorizations of all other parties necessary or advisable to
consummate the transactions contemplated by this Agreement or
required by the terms of any note, bond, mortgage, indenture,
deed of trust, license, franchise, permit, concession, contract,
lease, or other instrument to which such Seller or any of the
Companies to be sold by it hereunder is a party or by which any
of them or any of their respective properties is bound. Each
Seller agrees that the Buyer shall have the right to review in
advance all information relating to the transactions
contemplated by this Agreement that appear in any filing made by
such Seller in connection with the transactions contemplated
hereby.
(d) On or before the Closing Date, each Seller shall use
its commercially reasonable efforts to renew or extend any
Permit applicable to the operation of the Companies to be sold
by such Seller hereunder that has expired or will expire prior
to or within ninety days after the Closing Date and shall take
such other actions to preserve any Permit in the ordinary course
of business.
8.3 Operation of Business.
(a) Unless otherwise contemplated by this Agreement or with
the prior written consent of the Buyer (such consent not to be
unreasonably withheld or delayed), during the Interim Period,
Trust I shall, and shall cause the Olinda Companies to, and
the Providence Sellers shall, and shall cause the Providence
Companies to:
(i) operate and maintain the Olinda Operating Business or
the Providence Operating Business, as the case may be, in the
ordinary course of business consistent with past practice and
Good Engineering Practices (including the continued scheduling
and performance of regular and customary maintenance, and
maintenance overhauls);
(ii) use their respective commercially reasonable efforts
to (x) preserve intact in all material respects their
business, organization, and goodwill, (y) preserve their
relationship with Persons having business dealings with respect
to the conduct of their business (including, without limitation,
A-44
customers, suppliers, service providers), and (z) provide
the Buyer with reports of meetings with any Governmental
Authority regarding the Project or the Expansions;
(iii) pay in the ordinary course of business all Taxes,
lease payments, insurance premiums, trade payables and any other
amounts due in relation to the Companies or the Projects as they
come due;
(iv) promptly notify Buyer of any breach of any
representation, warranty, covenant or agreement of Sellers or
the Companies hereunder or any Material Adverse Effect;
(v) continue to pursue the Olinda Expansion and the
Providence Expansion (as the case may be) in such manner as may
be reasonably determined by Sellers; provided that the
Expansions will be pursued in a manner not inconsistent with the
descriptions in Annexes 4 and 6,
respectively, and no amendment to such descriptions shall be
made without the prior written consent of the Buyer (such
consent not to be unreasonably withheld, conditioned or delayed);
(vi) obtain title insurance (at Trust I’s cost)
for the Olinda Project and the Olinda Expansion on terms
reflected in the existing title insurance commitment dated
March 10, 2010 (Order No.: 810066724-X49);
(vii) within ten (10) days from the date of this
Agreement, cause the Olinda Companies and the Providence
Companies to issue limited notices to proceed to DCO California,
Inc. and to DCO Energy, LLC as contemplated by the Olinda EPC
Contract and the Providence EPC Contract, respectively, in order
to cause the contractor thereunder to provide
and/or
arrange for the provision of engineering, site preparation and
related services to the Olinda Companies and Providence
Companies (as applicable) so as to advance the construction of
the Olinda Expansion and the Providence Expansion; and
(viii) make capital and maintenance expenditures in
accordance with the budget attached hereto as
Annex 8.
(b) Except (i) as required or otherwise specifically
permitted by the terms of this Agreement, (ii) as set
forth in Section 8.3(b) of the Disclosure Schedules, or
(iii) with the prior written consent of the Buyer (such
consent not to be unreasonably withheld, conditioned or
delayed), during the Interim Period, Trust I shall not
cause or permit any of the Olinda Companies to, and the
Providence Sellers shall not cause or permit any of the
Providence Companies to (where applicable):
(A) amend its Governing Documents or recapitalize,
reorganize, liquidate, dissolve, or wind up;
(B) issue any Equity Interests (other than Equity Interests
issued to Trust I or the Providence Sellers (as applicable)
in exchange for the cancellation of inter-company Indebtedness);
(C) sell, lease, license or dispose of any Assets, other
than as used, consumed, or replaced in the ordinary course of
business consistent with past practice and Good Engineering
Practices (but only to the extent that such Assets are not
material for the operation of the business of either the Olinda
Companies or the Providence Companies as currently conducted or
as proposed to be conducted by the Expansions);
(D) encumber, pledge, mortgage, or suffer to be imposed on
any Assets any material Lien other than Permitted Encumbrances;
(E) terminate, allow to expire, amend, modify, grant any
waiver under or provide any consent under any Olinda Project
Contract or any Providence Project Contract;
(F) elect to be taxed as a corporation for federal or any
state income Tax purposes, adopt or change any method of Tax
accounting, file any amended Tax Return, surrender any right to
claim a Tax refund, enter into any closing agreement, settle any
claim or assessment relating to Taxes, consent to any extension
or waiver of the limitation period applicable to any Tax claim
or
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assessment, or take any other similar action relating to the
filing of any Tax Return or the payment of any Tax;
(G) change any of its financial accounting methods,
policies, or practices, except as required by GAAP or applicable
Law;
(H) incur Indebtedness that remains outstanding after the
Closing and that does not otherwise reduce the Olinda Purchase
Price or the Providence Purchase Price (as applicable) as
contemplated by Section 2;
(I) declare, make or pay any dividends or equity
distributions to any of the Sellers or pay any other return of
or on the capital investments of any of the Sellers, or redeem,
purchase or otherwise acquire any Equity Interests;
(J) settle or compromise any action or proceeding if such
settlement or compromise would result in a liability or
materially restrict the business of any of the Companies
following the Closing;
(K) acquire, merge or consolidate with, or make any
investment in or loan or advance to, or purchase substantially
all of the assets of, any Person, except for purchases of assets
in an aggregate amount of no more than $500,000;
(L) take or omit to take any action that would reasonably
be expected to result in a Material Adverse Effect;
(M) enter into any contract (i) outside of the
ordinary course of business or (ii) restricting in any
material respect the conduct of the business of any of the
Companies or the Olinda Project, the Providence Project, the
Olinda Expansion or the Providence Expansion;
(N) enter into any contract which survives Closing with any
officer, director, shareholder, trustee or beneficiary of any
shareholder, member, manager or other insider or Affiliate;
(O) delay the payment of accounts payable or accelerate the
collection of or discount any accounts receivable, other than in
the ordinary course of business consistent with past practices
or as contemplated in the Agreed Accounting Principles;
(P) (i) make any capital expenditures or commit to
make any capital expenditures for the Olinda Expansion in excess
of the budget for capital expenditures specifically set forth in
the plan for the Olinda Expansion, and attached hereto as
Annex 9, or (ii) make any capital
expenditures or commit to make any capital expenditures for the
Providence Expansion in excess of the budget for capital
expenditures specifically set forth in the plan for the
Providence Expansion, and attached hereto as
Annex 10;
(Q) assume or guarantee the obligations of any Person other
than a Company in the ordinary course of business;
(R) enter into any contract, agreement or arrangement that
would be a Olinda Project Contract or a Providence Project
Contract if entered into prior to the date hereof;
(S) enter into any contract, agreement or arrangement that
restricts, limits or impedes the ability to conduct its business
or line of business in any geographic area;
(T) discharge or satisfy any material Lien or paid any
material obligation or liability, other than current liabilities
paid in the ordinary course of business;
(U) enter into any (i) lease for real property
(including any landfill gas resource), (ii) energy,
capacity or ancillary service purchase, sale, exchange, option,
swap, or other arrangement, (iii) environmental attribute
purchase or sale agreement, (iv) electric transmission
agreement, (v) capital equipment lease or purchase
agreement, or (vi) services agreement related to the
development or management of landfill gas resources or the
operation and maintenance of the Projects;
(V) enter into any unhedged or otherwise speculative
transaction;
A-46
(W) make or grant any bonus, wage or salary increase to any
employee or group of employees, or make or grant any increase in
any employee benefit plan or arrangement, or, except as required
by Law, amend or terminate any existing employee benefit plan or
arrangement or adopt any new employee benefit plan or
arrangement; or
(X) enter into any agreement, or otherwise become
obligated, to take any of the foregoing actions.
With respect to the actions described in clause (H), (M)(i) or
(P) above, the Sellers shall promptly notify the Buyer of
any Emergency Situation that excuses the Sellers from obtaining
the Buyer’s approval thereunder, which notice shall include
the Sellers’ proposed response to that Emergency Situation
and a good faith estimate of the cost of the Sellers’
proposed response. The Buyer may propose a good faith
alternative response to such Emergency Situation, in all cases
within twenty four (24) hours of receipt of the
Sellers’ notice and proposal. If the Sellers conclude in
good faith that the Buyer’s alternative proposal for such
Emergency Situation conforms to Good Engineering Practices and
that such proposal can be implemented within a time period, at a
cost and with a likelihood of success better than the
Sellers’ original proposal, then the Sellers shall
implement the Buyer’s alternative proposal for such
Emergency Situation without further action required. If the
Buyer fails to propose an alternative response to such Emergency
Situation as described above within twenty four (24) hours
of receipt of the Sellers’ notice and proposal, or if the
Sellers conclude in good faith that (i) the Buyer’s
alternative proposal for such Emergency Situation does not
conform to Good Engineering Practices or (ii) such
proposal cannot be implemented within a time period, at a cost
and with a likelihood of success better than the Sellers’
original proposal, then the Sellers shall have the right to
implement the Sellers’ proposed response for such Emergency
Situation without further action required. For the avoidance of
doubt, and notwithstanding anything to the contrary in this
Agreement, the Parties agree that any action taken by the
Sellers in response to an Emergency Situation in compliance with
this paragraph shall not constitute a breach of
Sections 8.3(b)(H), 8.3(b)(M)(i) or 8.3(b)(P), but will not
otherwise alter Buyer’s closing conditions,
indemnification, remedies or the calculation of the Purchase
Price contemplated in this Agreement.
8.4 Access and Information. During
the Interim Period, each Seller shall cause the Companies to be
sold by it hereunder to: (i) permit the Buyer and
Representatives of the Buyer during normal business hours to
have access upon reasonable notice, in a manner so as not to
interfere with the normal business operations of such Companies
or RPMC, to the Sites, Assets, premises, properties, books, and
records (including Tax records) associated with the related
Project or Expansion and to permit the Buyer to make such
reasonable inspections thereof as the Buyer may reasonably
request; (ii) provide the Buyer with such financial and
operating data and other similar information relating to such
Companies or such Project or Expansion in such Seller’s or
any Companies’ possession or control, or to which any
Seller or any Company has a contractual right as the Buyer may
reasonably request; (iii) furnish or make available to
the Buyer with a copy of each material report, schedule, or
other document filed or received by such Seller or such
Companies with respect to such Projects or Expansions with a
Governmental Authority and provide the Buyer with reports of any
meetings with a Governmental Authority relating to the Projects
or Expansions; and (iv) provide the Buyer with regular
updates regarding the progress of the design, permitting and
development of the Expansions. Notwithstanding the foregoing,
none of the Sellers shall be obligated to cause any of the
Companies to: (i) provide any information, records,
or documents to the extent that the provision of such
information, records, or documents could violate any contractual
obligation (after seeking a waiver of such contractual
obligation) or result in the loss of the
attorney-client
privilege with respect to such information, records, or
documents; or (ii) supply the Buyer with any
information, records, or documents that any of the Companies or
any of their Affiliates is under a legal obligation not to
supply (after seeking a waiver of such legal obligation, where
applicable). The Buyer shall hold any information, records, or
documents provided to it pursuant to this Section 8.4 or
any other provision of this Agreement in confidence in
accordance with the provisions of the Confidentiality Agreement,
the terms of which are hereby incorporated herein by reference.
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8.5 Schedule Update. From
time to time prior to the Closing Date, each Seller shall
supplement or amend and deliver updates to the Disclosure
Schedules (each a “Schedule Update”), to
the extent that new items are discovered or new matters arise
which any Seller was otherwise entitled or obligated to disclose
hereunder. No Schedule Update delivered pursuant to this
Section 8.5 shall be deemed to cure any breach of this
Agreement (determined without regard to any such
Schedule Update).
8.6 Further Assurances.
(a) At any time and from time to time after the Closing, at
the written request of the Buyer, each Seller shall, subject to
Section 14.14 and Section 12.2.: (i) execute
and deliver such instruments of sale, transfer, conveyance,
assignment, and confirmation; and (ii) take such action,
in each case as such Seller and the Buyer may reasonably agree
is necessary to transfer, convey, and assign to the Buyer and to
confirm the Buyer’s title to or interest in the Interests
(at such Seller’s expense), and the Companies and their
respective Assets (at the Buyer’s expense), to be sold by
such Seller hereunder.
(b) The Buyer acknowledges that one or more of the Sellers
and/or
certain of their Affiliates may liquidate their assets and
dissolve following the Closing, and nothing set forth in this
Section 8.6 or elsewhere in this Agreement shall be deemed
to restrict or limit in any way the right of any of the Sellers
or any Affiliate of the Sellers to do so at any time after the
Closing Date.
8.7 Access after Closing. For a
period of two (2) years after the Closing Date (or such
longer period as may be reasonably required in the case of a Tax
Controversy), the Buyer shall have reasonable access to all of
the records, books, and documents of the Sellers related to the
Companies and the Projects to the extent that such access may be
necessary in connection with matters relating to or affected by
the operations of the Companies or the Projects prior to the
Closing Date (including, without limitation, liabilities with
respect to Taxes). Such access shall be afforded upon receipt of
reasonable advance notice and during normal business hours. The
Buyer shall be solely responsible for any costs or expenses
incurred by it or
out-of-pocket
costs of any Seller pursuant to this Section 8.7. If any
Seller shall desire to dispose of any records, books, or
documents that may relate to operations of any of the Companies
or any of the Projects before the Closing prior to the
expiration of such two-year period, such Seller shall, prior to
such disposition, give the Buyer a reasonable opportunity, at
the Buyer’s expense, to segregate and remove such records,
books, or documents as the Buyer may select. The Buyer
acknowledges that one or more of the Sellers
and/or
certain of their Affiliates may liquidate their assets and
dissolve, and nothing set forth in this Section 8.7 shall
be deemed to restrict or limit in any way the right of any of
the Sellers or any Affiliate of the Sellers to do so at any time
after the Closing Date, including prior to the conclusion of
such two-year period.
(a) The Sellers, the Parent Companies, RRP and RPMC shall,
and they each shall cause their respective Representatives and,
in the case of the Sellers and the Parent Companies, the
Companies, to, immediately cease and cause to be terminated any
discussions or negotiations with any third party (other than
Buyer and its Affiliates) that may be ongoing as of the date
hereof with respect to an actual or potential Alternative
Transaction. In addition, the Sellers, the Parent Companies,
RRP, and RPMC shall not, and they each shall cause their
respective Representatives and, in the case of the Sellers and
the Parent Companies, the Companies, not to, subject to
Section 8.8(b) below, (i) directly or indirectly,
solicit, or initiate or knowingly facilitate or encourage
(including by way of furnishing non-public information or
providing access to its properties, books, records or personnel)
any inquiries regarding, or the making of any proposal or offer
that constitutes, or would reasonably be expected to result in,
an Alternative Transaction, (ii) enter into any agreement
or agreement in principle with respect to an Alternative
Transaction, (iii) engage in negotiations or discussions
regarding, or furnish or disclose to any third party any
information with respect to any Alternative Transaction;
provided, however, that at any time prior to
obtaining the Shareholder Approvals, in response to a bona fide
Alternative Transaction received by the Sellers or the
Sellers’ Representative after the date hereof that was not
solicited in violation of this Section 8.8 and that RRP, as
the managing shareholder of the Trusts, determines in good faith
(after consultation with outside legal counsel and financial
advisors) would reasonably be expected
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to lead to a Superior Proposal, and, that the failure to take
the actions set forth in clauses (x) and (y) below
with respect to such Alternative Transaction would be
inconsistent with its fiduciary duties under applicable Law and
the governing documents of such Seller (as such documents are in
effect as of the date hereof), then the Sellers’
Representative may (on behalf of Trust I or the Providence
Sellers (as applicable)), in response to such Alternative
Transaction (x) provide access to its properties,
personnel, books and records and furnish information to the
Person making such Alternative Transaction and (y)
participate in discussions or negotiations with the Person
making such Alternative Transaction regarding such Alternative
Transaction; provided, that, prior to furnishing such
information to or entering into discussions or negotiations with
such Person, the Sellers’ Representative shall receive from
such Person an executed confidentiality agreement, the terms of
which shall be substantially similar to, and not materially less
favorable to the Sellers and the Companies than, in the
aggregate, those contained in the Confidentiality Agreement;
provided, further that the Sellers’
Representative shall promptly provide to Buyer any non-public
information concerning the Sellers or the Companies not
previously provided to Buyer or its Representatives that is
provided to the Person making such Alternative Transaction.
(b) Notwithstanding any provisions in this Section 8.8
to the contrary, prior to obtaining the applicable Shareholder
Approval, RRP, as the managing shareholder of the Trusts, may,
in response to a Superior Proposal, (i) withdraw (or not
make or continue to make) or modify, or publicly propose to
withdraw (or not make or continue to make) or modify, both the
Olinda Recommendation and the Providence Recommendation,
(ii) enter, or cause the Sellers to enter, into an
agreement regarding such Superior Proposal, or (iii)
approve or recommend any such Superior Proposal, in each case,
if (A) RRP, as the managing shareholder of the applicable
Trusts, has determined in good faith (after consultation with
its outside legal counsel) that the failure to take such action
would be inconsistent with the fiduciary duties of RRP to the
holders of shares of the applicable Trusts under applicable Law
and the governing documents of such Seller (as such documents
are in effect as of the date hereof), (B) (1) the
Sellers’ Representative has given the Buyer three
(3) days prior written notice of RRP’s intention, as
the managing shareholder of the applicable Trusts, to take such
action (it being understood and agreed that any change to the
consideration offered or other material terms of such Superior
Proposal shall require an additional notice to Buyer and a new
three (3) day notice period) and (2) RRP shall have
considered in good faith (after consultation with its outside
legal counsel and financial advisors) any changes or revisions
to this Agreement proposed in writing by Buyer and shall not
have determined that the Superior Proposal would no longer
constitute a Superior Proposal if such changes were to be given
effect and (3) the Sellers and the Companies (as
applicable) shall have complied in all respects with their
obligations under this Section 8.8 and (C) the
Sellers’ Representative shall have terminated this
Agreement in accordance with the provisions of
Section 13.1(d) hereof and shall have paid to Buyer the
termination fee and expenses in accordance with
Section 13.2(c). None of the Sellers nor the Companies
shall, after the date hereof, enter into any confidentiality
agreement that would prohibit it from providing any of the above
information to the Buyer.
(c) For purposes of this Agreement, “Alternative
Transaction” means any proposal or offer, in each case
made in writing, from any third party, relating to, in a single
transaction or a series of related transactions, any
(a) merger, consolidation, business combination,
reorganization, share exchange,
spin-off,
split-off, recapitalization, liquidation, dissolution or similar
transaction involving a direct or indirect acquisition of 20% or
more of the assets (based on fair market value) of any of the
Providence Companies or any of the Olinda Companies, or
(b) the acquisition (including by way of tender or exchange
offer) in any manner, directly or indirectly, of over 20% of the
Equity Interests of or the consolidated assets (based on their
fair market value) of any of the Olinda Companies or any of the
Providence Companies.
8.9
Affiliate Transactions. Except
as otherwise provided herein or in any other Transaction
Document, each Seller shall cause: (
i) all accounts,
whether payables or receivables, between any of the Companies,
on the one hand, and such Seller or any of its Affiliates (other
than the Companies), on the other hand, to be paid or released
in full prior to the Closing (with no liability or adverse
impact to Buyer or the Companies following the Closing);
(
ii) all other contracts between any of the Companies, on
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the one hand, and such Seller or any of its Affiliates (other
than the Companies), on the other hand, to be terminated with no
liability or adverse impact to Buyer or the Companies (following
the Closing), or other force or effect after the Closing; and
(iii) all officers and directors of the Companies to resign
effective as of the Closing (without any liability to Buyer or
the Companies following the Closing).
(a) Each Seller hereby acknowledges that it or he is
familiar with the Companies’ trade secrets and other
confidential information. Each Seller acknowledges and agrees
that the Companies would be irreparably damaged if it were to
provide services to or otherwise participate in the business of
any Person competing with the Companies in a similar business
and that any such competition by any Seller would result in a
significant loss of goodwill by the Companies. Each Seller
further acknowledges and agrees that the covenants and
agreements set forth in this Section 8.10 were a material
inducement to Buyer to enter into this Agreement and to perform
its obligations hereunder, and that Buyer and its Affiliates
would not obtain the benefit of the bargain set forth in this
Agreement as specifically negotiated by the parties hereto if
such Seller breached the provisions of this Section 8.10.
Therefore, in further consideration of the amounts to be paid
hereunder for the Equity Interests and the goodwill of the
Companies sold by Sellers, each Seller agrees that he shall not
(and shall cause his Affiliates not to), for a period of three
(3) years after the Closing Date, (i) induce, or
attempt to induce, any employee of the Companies to terminate
his association with the Companies, or in any way interfere with
the relationship between the Companies or any of their
Affiliates, on the one hand, and any employee, on the other hand
or (ii) hire any person who was an employee of the
Companies at any time during the six month period immediately
prior to the date on which such hiring would take place (it
being conclusively presumed by the parties so as to avoid any
dispute under this Section 8.10 that any such hiring is in
violation of clause (i) above).
(b) The covenants contained in this Section 8.10 are
considered by the Sellers to be fair, reasonable and necessary
for the protection of Buyer and the Companies. Each Seller
acknowledges that the scope, duration and area of the
restrictions contained in this Section 8.10 are both
reasonable and necessary for the legitimate protection of Buyer
and the Companies following the Closing Date. If any portion of
this Section 8.10, or any portion of any subsection of this
Section, shall be determined by any court of competent
jurisdiction to be unenforceable, then such Section or
subsection shall be interpreted to extend only over the maximum
period of time, geographic area or range of activities as to
which it may be enforceable, and the Parties shall forthwith
amend this Agreement to the extent required to render it
enforceable.
(c) If any Seller or any of his respective Affiliates
breaches, or threatens to commit a breach of, any of the
covenants set forth in this Section 8.10, Buyer and the
Companies shall have the following rights and remedies, each of
which rights and remedies shall be independent of the others and
severally enforceable, and each of which is in addition to, and
not in lieu of, any other rights and remedies available to Buyer
or the Companies or their Affiliates at law or in equity:
(i) the right and remedy to have the covenants set forth in
this Section 8.10 specifically enforced by any court of
competent jurisdiction, it being agreed that any breach or
threatened breach of the covenants set forth in this
Section 8.10 would cause irreparable injury to Buyer and
the Companies and that money damages would not provide an
adequate remedy to Buyer and the Companies; and
(ii) the right and remedy to require the breaching Seller
to account for and pay over to Buyer or the Companies any
profits, monies, accruals, increments or other benefits derived
or received by such Person as the result of any transactions
constituting a breach of the covenants set forth in this
Section 8.10.
(iii) In the event of any breach or violation by a Seller
of any of the covenants set forth in this Section 8.10, the
time period of such covenant for such breaching Seller shall be
tolled until such breach or violation is resolved.
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(a) The Sellers shall, and shall cause the Companies to,
provide such cooperation as may be reasonably requested by Buyer
in connection with its debt financing activities relating to the
Projects or the Expansions, including: (i) participation
in meetings, drafting sessions, and due diligence sessions, and
otherwise assisting Buyer in the preparation of offering,
marketing and syndication materials; (ii) reasonably
cooperating with the marketing efforts of Buyer and its
financing sources for any of its debt financing activities
related to the Projects or the Expansions (the
“Financing Entities”), including participation
in management presentation sessions, meetings with rating
agencies, and “road shows;” (iii) furnishing
Buyer and the Financing Entities with financial and other
pertinent information regarding the Companies and their assets
as may be reasonably requested by Buyer, including all financial
statements, pro forma statements, business projections, and
other financial data of the type required by
Regulation S-X
and
Regulation S-K
for a “Smaller Reporting Company” under the Securities
Act, or of the type and form customarily included in offering
memoranda, private placement memoranda, prospectuses, bank books
and similar documents; (iv) providing and executing
documents as may be reasonably requested by Buyer, including a
certificate of the Chief Financial Officer of the Companies with
respect to solvency matters and consents of accountants for use
of their reports in any materials relating to Buyer’s debt
financing activities relating to the Projects or the Expansions;
(v) reasonably facilitating the pledging of collateral;
and (vi) using commercially reasonable efforts to obtain
accountants’ comfort letters, legal opinions, surveys and
title insurance as reasonably requested by Buyer; it being
understood that neither RPMC, the Companies nor the Sellers
shall be required to bear any of the
out-of-pocket
costs, including accountants and attorneys’ fees, for any
such cooperation in connection with such debt financing
activities prior to the Closing.
(b) The Sellers shall, and shall cause the Companies, in
addition to clause (a) above, and to the extent reasonably
required by Buyer: (i) to the extent feasible, execute
any assignments, amendments and modifications to any documents
that are effective only if Closing occurs or are relevant to the
debt financing (including, without limitation, any Material
Project Document (including those currently in draft form)
reasonably requested by the Financing Entities or the Buyer, if
any; and (ii) to promptly execute or consent to other
documents that are effective only if Closing occurs or to the
extent reasonably required by any Financing Entities or the
Buyer in connection with the debt financing. The Sellers shall,
and shall cause the Companies to, also provide such data,
reports, certifications and other documents as may be reasonably
requested by any Financing Entities or the Buyer with respect to
the debt financing (including, as the case may be, any such
data, reports, certifications, and other documents required with
respect to any Treasury Grant application). Without limiting the
foregoing, as soon as feasible after determination of the layout
of the Olinda Expansion, BPP and BPII shall use commercially
reasonable efforts to have surveyed the “Site” (as
described therein) licensed to such parties under the Third
Amended & Restated Landfill Gas Rights &
Production Facilities Agreement referred to in the definition of
Material Project Documents and to have such agreement amended to
reflect such survey.
(c) Within four (4) Business Days following
Buyer’s receipt of a duly executed copy of a binding debt
financing commitment with its lenders with respect to the debt
financing of the Projects
and/or the
Expansions, Buyer shall deliver a copy of such debt financing
commitment to the Sellers’ Representative (for the benefit
of the Sellers). Within four (4) Business Days following
receipt of such debt financing commitment, RRP, as the managing
shareholder of the Trusts, shall make a determination in good
faith (after consultation with outside counsel and financial
advisors) whether such debt commitment contains any changes to
the conditions to closing the transactions contemplated by this
Agreement from those set forth in the Debt Term Sheet (including
Section 50 thereof) and, if so, whether such changes would
reasonably be likely to delay the consummation of the
transactions contemplated by this Agreement such that the
transactions contemplated by this Agreement would not be capable
of completion by the Termination Date, including, if such
changes would require a modification of any material Permit or
of any Material Project Document in a manner that would
reasonably be likely to result in such delay (such a
determination a “Financing Delay
Determination”). Within three (3) Business Days
following receipt of such debt financing commitment, the
Sellers’ Representative shall notify Buyer whether a
Financing
A-51
Delay Determination has been made (and shall specify the factors
underlying such determination in detail). If the Sellers’
Representative does not so notify Buyer within such three
(3) Business Day time period, then it shall be deemed that
no such Financing Delay Determination was made. In the event
that the Sellers’ Representative delivers a Financing Delay
Determination to Buyer, then Buyer and the Sellers shall work
together in good faith to eliminate such delay (if practicable),
including by discussing such delay with Buyer’s lenders (to
the extent agreed upon by Buyer and Buyer’s lenders without
additional cost or expense to Buyer) such that the Closing could
take place prior to the Termination Date. In the event that the
parties are unable to remove any such delay resulting in such
Financing Delay Determination within five (5) Business Days
following Buyer’s receipt thereof, then the Seller
Representative shall not be required to mail or cause to be
mailed the Consent Statements to the respective holders of
Equity Interests of each of Trust I, Trust III,
Trust IV and B Fund for the purpose of obtaining the
Shareholder Approval for each such Seller and Buyer shall be
permitted to terminate this Agreement in accordance with
Section 13.1(f).
8.12
Interim Financial
Statements. During the period commencing on
the date hereof and ending at the earlier of the termination of
this Agreement or immediately prior to the Closing, the Sellers
shall (
i) cause the Companies to provide to Buyer, within
fifteen (15) days of the end of each calendar month, the
unaudited consolidated balance sheet, income statement and
statement of cash flows as of the end of, or for, such month as
applicable, for the Olinda Company Group and the Providence
Company Group (as applicable) each on a consolidated basis
subject to customary adjustments and the absence of footnotes,
(
ii) cause the Companies to provide to Buyer, within
fifteen (15) days of the end of each fiscal quarter, the
unaudited consolidated balance sheet and the unaudited
consolidated statements of income and of cash flow for such
fiscal quarter for the Olinda Company Group and the Providence
Company Group (as applicable) each on a consolidated basis
subject to customary adjustments and the absence of footnotes,
(
iii) cause the Companies to provide to Buyer, such other
financial statements and information as contemplated by
Section 50(w) of the Debt Term Sheet, and (
iv) cause
the Companies to endeavor to provide to Buyer, such other
financial statements and information, as may reasonably be
requested by the Buyer or the Financing Entities.
(a) Prior to the Closing, the Buyer shall use commercially
reasonable efforts to effect the consummation of the
transactions contemplated by this Agreement, as soon as
reasonably practicable after the date hereof (including
satisfaction, but not waiver, of the closing conditions set
forth in Section 10).
(b) The Buyer shall perform all obligations of the Buyer
set forth in Section 8 in accordance with the applicable
terms thereof.
(c) The Buyer shall use diligent and commercially
reasonable efforts to (i) obtain a firm commitment for
the debt financing contemplated by the Debt Term Sheet, on terms
substantially similar to those set forth on the Debt Term Sheet
or on such other terms as shall enable the timely consummation
of the transactions contemplated by this Agreement (but shall
have no obligation to obtain any such commitment for the debt
financing on terms less favorable to Buyer than those set forth
in the Debt Term Sheet, including, without limitation, with
respect to each of the debt facilities contemplated by the Debt
Term Sheet), and (ii) ensure that the Equity Commitment
Letter remains in effect through the Closing and (iii) upon
satisfaction of the conditions precedent to Closing set forth in
Section 10.1, cause the Sponsors to make the equity
contributions contemplated under the Equity Commitment Letter
(in accordance with the terms thereof).
(a) The Buyer shall cooperate with the Sellers to jointly
prepare and file, or cause to be filed, as promptly as
practicable after the date hereof, with FERC an application
pursuant to Section 203(a) of the Federal Power Act,
requesting approval for the transactions contemplated hereby.
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(b) Prior to the Closing, the Buyer shall cooperate with
the Sellers and use commercially reasonable efforts to:
(i) promptly prepare, support, assist in preparing, join
in, and file any filings, applications, and all other necessary
documentation; (ii) effect all necessary applications,
notices, petitions and filings and execute all agreements and
documents; and (iii) obtain and not oppose, directly or
indirectly, all necessary consents, approvals, and
authorizations of all other parties necessary or advisable to
consummate the transactions contemplated by this Agreement,
including, without limitation, any consent of FERC and the
Committee on Foreign Investment in the United States, or
required by the terms of any note, bond, mortgage, indenture,
deed of trust, license, franchise, permit, concession, contract,
lease, or other instrument to which the Buyer is a party or by
which it or any of its properties is bound. The Buyer agrees
that each of the Sellers and the Sellers’ Representative
shall have the right to review in advance all information
relating to the transactions contemplated by this Agreement that
appear in any filing made by the Buyer in connection with the
transactions contemplated hereby.
(c) The Buyer shall cooperate with all efforts and actions
taken by any of the Sellers pursuant to Section 8.2(d).
(d) Buyer has provided the Sellers with its good faith
analysis as to why a joint voluntary notification to the
Committee on Foreign Investment in the United States under
Section 721 of the Defense Production Act of 1950 is not
necessary in connection with this transactions contemplated by
this Agreement.
9.3
Further Assurances. At any
time and from time to time after the Closing, at the request of
any of the Sellers or the Sellers’ Representative, the
Buyer shall, subject to Section 14.14: (
i) execute
and deliver such instruments of sale, transfer, conveyance,
assignment, and confirmation; and (
ii) take such action,
in each case as such Seller or Sellers or the Sellers’
Representative, and Buyer may reasonably agree is necessary to
transfer, convey, and assign to the Buyer and to confirm
Buyer’s title to or interest in the Interests.
9.4
Access after Closing. For a
period of two (2) years after the Closing Date (or such
longer period as may be reasonably requested in the case of a
Tax controversy), the Sellers shall have reasonable access to
all of the records, books, and documents of the Buyer related to
the Companies and the Projects to the extent that such access
may reasonably be required in connection with matters relating
to or affected by the operations of the Companies or the
Projects prior to the Closing Date (including, without
limitation, liabilities with respect to Taxes and the
Sellers’ use of Production Tax Credits). Such access shall
be afforded upon receipt of reasonable advance notice and during
normal business hours. The Sellers shall be solely responsible
for any costs or expenses incurred by them or the Buyer pursuant
to this Section 9.4. If the Buyer shall desire to dispose
of any records, books, or documents that may relate to
operations of the Companies or the Projects before the Closing
prior to the expiration of such period, the Buyer shall, prior
to such disposition, give the Sellers a reasonable opportunity,
at the Sellers’ expense, to segregate and remove such
records, books, or documents as the Sellers may select.
9.5
Support Services. The Buyer
acknowledges that the Companies currently receive (or have
received in the past) from the Sellers or their Affiliates
(including RPMC) certain corporate and other services and
support, including operations and maintenance, general and
administrative services, audit services, legal services, human
resources services, tax services, finance services, cash
management services, information technology services and support
and insurance and facilities-related support.. The Buyer
acknowledges that, except as expressly provided in the other
Transaction Agreements, such services shall cease at the
Closing, and all agreements and arrangements in respect thereof
shall terminate as of the Closing, with no further obligation of
any party thereto.
9.6
Use of Name. The Buyer and its
Affiliates (including the Companies following the Closing) shall
not use any name which includes “Ridgewood” for any
purpose following the Closing;
provided,
however,
that after the Closing Date, the Buyer and its Affiliates
(including the Companies) shall be permitted to use names which
include “Ridgewood” solely for the purposes of
(
i) for a period of 120 days, communicating the
Buyer’s acquisition of the Interests to the Projects’
vendors and business prospects, (
ii) for a period of
120 days, in the Governing Documents of the Companies; and
(
iii) to the
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extent reflected on any of the Projects’ Permits or any
filings with Governmental Authorities, operating the Projects.
(a) THE BUYER AGREES AND ACKNOWLEDGES THAT, NOTWITHSTANDING
ANY PROVISION OF THIS AGREEMENT TO THE CONTRARY,
(I) TRUST I MAKES NO REPRESENTATIONS OR WARRANTIES TO
THE BUYER OR ANY OTHER PERSON WITH RESPECT TO THE BREA PARENT
INTERESTS OR THE OLINDA COMPANIES OR OTHERWISE IN CONNECTION
WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, EXCEPT AS
SPECIFICALLY SET FORTH IN SECTION 3 AND SECTION 4, AND
(II) NONE OF THE PROVIDENCE SELLERS MAKES ANY
REPRESENTATIONS OR WARRANTIES TO THE BUYER OR ANY OTHER PERSON
WITH RESPECT TO THE RILG INTERESTS OR THE PROVIDENCE COMPANIES
OR OTHERWISE IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT, EXCEPT AS SPECIFICALLY SET FORTH IN
SECTION 3 AND SECTION 5. THE BUYER AGREES AND
ACKNOWLEDGES THAT ALL OTHER REPRESENTATIONS AND WARRANTIES,
WHETHER EXPRESS OR IMPLIED, ARE DISCLAIMED BY TRUST I AND
THE PROVIDENCE SELLERS. EXCEPT FOR THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN SECTION 3, SECTION 4 AND
SECTION 5, THE BREA PARENT INTERESTS, THE RILG INTERESTS,
THE OLINDA PROJECT, THE PROVIDENCE PROJECT, THE OLINDA
COMPANIES, THE PROVIDENCE COMPANIES AND THEIR ASSETS ARE SOLD
“AS IS, WHERE IS.”
(b) THE BUYER AGREES AND ACKNOWLEDGES THAT, WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, AND EXCEPT FOR ANY
REPRESENTATIONS AND WARRANTIES SET FORTH IN
(I) SECTION 3 AND SECTION 4, TRUST I
SPECIFICALLY DISCLAIMS ANY REPRESENTATION OR WARRANTY OF
MERCHANTABILITY, USAGE, OR SUITABILITY OR FITNESS FOR ANY
PARTICULAR PURPOSE WITH RESPECT TO THE ASSETS OF THE OLINDA
COMPANIES, THE OLINDA PROJECT, OR ANY PART THEREOF OR AS TO
THE CONDITION OR WORKMANSHIP THEREOF OR THE ABSENCE OF ANY
DEFECTS THEREIN, WHETHER LATENT OR PATENT, AND
(II) SECTION 3 AND SECTION 5, EACH OF THE
PROVIDENCE SELLERS SPECIFICALLY DISCLAIMS ANY REPRESENTATION OR
WARRANTY OF MERCHANTABILITY, USAGE, OR SUITABILITY OR FITNESS
FOR ANY PARTICULAR PURPOSE WITH RESPECT TO THE ASSETS OF THE
PROVIDENCE COMPANIES, THE PROVIDENCE PROJECT, OR ANY
PART THEREOF OR AS TO THE CONDITION OR WORKMANSHIP THEREOF
OR THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR PATENT.
(c) THE BUYER AGREES AND ACKNOWLEDGES THAT, WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, AND EXCEPT FOR ANY
REPRESENTATIONS AND WARRANTIES SET FORTH IN
(I) SECTION 3 AND SECTION 4, TRUST I
SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS OR WARRANTIES OF ANY
KIND OR NATURE, EXPRESS OR IMPLIED, AS TO TITLE TO OR THE
CONDITION, VALUE OR QUALITY OF THE OLINDA PROJECT, OR THE
PROSPECTS (FINANCIAL AND OTHERWISE), RISKS AND OTHER INCIDENTS
OF THE OLINDA COMPANIES, INCLUDING, WITHOUT LIMITATION, WITH
RESPECT TO THE SUITABILITY OF THE OLINDA PROJECT FOR OPERATION
AS A POWER PLANT OR AS A SITE FOR THE DEVELOPMENT OF ADDITIONAL
OR REPLACEMENT GENERATION CAPACITY, THE ACTUAL OR RATED
GENERATING CAPABILITY OF THE OLINDA PROJECT, OR THE ABILITY OF
ANY OF THE OLINDA COMPANIES TO SELL THE OLINDA PROJECT’S
ENVIRONMENTAL ATTRIBUTES, ELECTRIC ENERGY, CAPACITY, OR OTHER
PRODUCTS, OR AS TO COMPLIANCE WITH, OR THE EXISTENCE OF ANY
LIABILITY (OR POTENTIAL LIABILITY) UNDER, ENVIRONMENTAL LAWS,
AND (II) SECTION 3 AND SECTION 5, EACH OF THE
PROVIDENCE SELLERS SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS OR
WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, AS TO
TITLE TO OR THE CONDITION, VALUE OR QUALITY OF THE
PROVIDENCE PROJECT, OR
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THE PROSPECTS (FINANCIAL AND OTHERWISE), RISKS AND OTHER
INCIDENTS OF THE PROVIDENCE COMPANIES, INCLUDING, WITHOUT
LIMITATION, WITH RESPECT TO THE SUITABILITY OF THE PROVIDENCE
PROJECT FOR OPERATION AS A POWER PLANT OR AS A SITE FOR THE
DEVELOPMENT OF ADDITIONAL OR REPLACEMENT GENERATION CAPACITY,
THE ACTUAL OR RATED GENERATING CAPABILITY OF THE PROVIDENCE
PROJECT, OR THE ABILITY OF ANY OF THE PROVIDENCE COMPANIES TO
SELL THE PROVIDENCE PROJECT’S ENVIRONMENTAL ATTRIBUTES,
ELECTRIC ENERGY, CAPACITY, OR OTHER PRODUCTS, OR AS TO
COMPLIANCE WITH, OR THE EXISTENCE OF ANY LIABILITY (OR POTENTIAL
LIABILITY) UNDER, ENVIRONMENTAL LAWS.
(d) The Buyer acknowledges that it has conducted to its
satisfaction an independent investigation of the Interests and
the financial condition, liabilities, results of operations and
projected operations of the Companies and the nature and
condition of their respective properties, assets, and businesses
(including the Projects and the Expansions) and, in making the
determination to proceed with the transactions contemplated by
this Agreement and the other Transaction Agreements, has relied
solely on the results of its own independent investigation and
the representations and warranties expressly set forth in
Sections 3, 4 and 5. The Buyer hereby disclaims reliance on
any other representation, warranty or guarantee, whether express
or implied. The Buyer acknowledges that (i) none of the
Sellers or the Companies, any of their Representatives, or any
other Person has made any representation or warranty, express or
implied, as to the accuracy or completeness of any information
regarding the Interests or the Companies or their respective
properties, assets, or businesses (including the Projects and
the Expansions), or other matters that is not expressly included
in Sections 3, 4 and 5 and (ii) there are no
agreements, understandings or covenants among the Parties
regarding the Interests or the Companies or their respective
properties, assets, or businesses (including the Projects and
the Expansions), or their transfer, other than those expressly
incorporated in this Agreement and the other Transaction
Agreements. Without limiting the generality of the foregoing,
none of the Sellers or the Companies, any of their
Representatives, or any other Person has made any representation
or warranty to the Buyer with respect to (A) any
projections, estimates or budgets for the Companies or their
businesses (including the Projects and the Expansions) or
(B) any materials, documents or information relating to
any of the Companies made available to the Buyer or its
Representatives in the Electronic Data Room or any information
memorandum, management presentation, question and answer
session, oral, written, or electronic response to any
information request provided to the Buyer, or otherwise, except
as expressly included in a representation or warranty set forth
in Sections 3, 4, and 5.
(E) EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES SET FORTH
IN SECTIONS 3, 4, AND 5, THE BUYER ACKNOWLEDGES AND AGREES
THAT THE INTERESTS, THE COMPANIES, THE ASSETS, AND THE PROJECTS
ARE SOLD “AS IS, WHERE IS” ON THE CLOSING DATE.
9.8
Purchase for Investment. The
Buyer acknowledges that the Interests have not been registered
under the Securities Act of 1933, as amended (the
“
Securities Act”), or under any state
securities laws. The Buyer is not an “underwriter” (as
such term is defined in the Securities Act), and is purchasing
the Interests solely for investment with no present intention to
distribute any of the Interests to any Person, and the Buyer
shall not sell or otherwise dispose of any of the Interests,
except in compliance with the registration requirements or
exemption provisions under the Securities Act, and the rules and
regulations thereunder, and any applicable state securities
laws. The Buyer is an “accredited investor” as defined
under Regulation D promulgated under the Securities Act.
The Buyer has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and
risks of its purchase of the Interests. The Buyer confirms that
it can bear the economic risk of its investment in the Interests
and can afford to lose its entire investment in the Interests,
has been furnished any and all materials relating to its
purchase of the Interests that it has requested, and the Sellers
have provided the Buyer with the opportunity to ask questions of
the officers of the Sellers and to acquire additional
information about the business and financial condition of the
Companies.
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10.1
Conditions to Obligation of the
Buyer. The obligation of the Buyer to
consummate the transactions to be performed by it in connection
with the Closing is subject to the satisfaction, on or before
the Closing Date, of each of the following conditions:
(a)
Representations and Warranties of the
Sellers. The representations and warranties
of the Sellers set forth in Sections 3, 4, and 5 that are:
(
i) qualified by materiality or Material Adverse Effect
shall be true and correct in all respects; or (
ii) not
qualified by materiality or Material Adverse Effect shall be
true and correct in all material respects, except that the
representations and warranties in Sections 3.1, 3.2, 3.3,
3.4, 3.5, 4.1, 4.2, 5.1, and 5.2 shall be true and correct in
all respects, in each case at and as of the date hereof and at
and as of the Closing Date with the same effect as though made
at and as of such time, except that those representations and
warranties that are made as of a specified date shall be true
and correct only as of such date.
(b)
Performance by the
Sellers. Each of the Sellers shall have
performed and complied in all material respects with all of the
covenants, agreements, and obligations contained herein required
to be performed by or complied with by it at or before the
Closing.
(c)
Regulatory Compliance. Orders
under Section 203 of the Federal Power Act shall have been
issued by FERC in a form reasonably acceptable to the Buyer in
connection with this Agreement and the transactions contemplated
by this Agreement with respect to each of the applications set
forth on Schedule 10.1(c) and filed as contemplated
hereunder.
(d)
Consents. (
i) All
consents, permits, approvals, or authorizations of or filings
with any third party or any Governmental Authority that are
(
A) necessary for the consummation of the Transactions
contemplated by this Agreement, (
B) necessary for Buyer
to operate the Olinda Companies and Providence Companies as
operated by Sellers as of the date hereof, (
C) necessary
to obtain as of the Closing in order to achieve the timely
construction of each of the Expansions in accordance with the
construction schedules and timelines contemplated by each of the
EPC Contracts (attached to Section 10.1(i)(f) of the
Disclosure Schedules), and (
D) necessary to obtain in the
ordinary course after Closing to achieve the timely construction
of each of the Expansions in accordance with the construction
schedules and timelines contemplated by each of the EPC
Contracts (attached to Section 10.1(i)(f) of the Disclosure
Schedules) shall in the case of clauses (i)(A), (B) and
(C) each have been obtained or waived by Buyer in writing,
and (
ii) in the case of clause (i)(D), no event shall
have occurred which would prevent or otherwise delay the
issuance of any such consents, permits, approvals, or
authorizations of or filings with any third party or any
Governmental Authority contemplated to occur following the
Closing which would reasonably be expected to prevent (or
otherwise delay) or increase the cost to Buyer of construction
of the Expansions in accordance with the construction costs,
schedules and timelines contemplated by each of the EPC
Contracts (attached to Section 10.1(i)(f) of the Disclosure
Schedules).
(f)
No Injunction, Law or
Order. There shall not be any: (
i)
injunction in effect; (
ii) Law enacted after the date
hereof; or (
iii) order issued by a court of competent
jurisdiction or other Governmental Authority, which in any such
case enjoins, prohibits, or restrains the consummation of the
transactions contemplated by this Agreement.
(g)
No Material Adverse
Effect. Since December 31, 2009, there
shall have been no fact, event, change, development,
circumstance, or effect that, individually or in the aggregate
with other facts, events, changes, developments, circumstances,
or effects, has had or would reasonably be expected to have a
Material Adverse Effect.
(i) Each of the conditions precedent to closing set forth
in Section 50 of the Debt Term Sheet, and each of the
conditions precedent to closing set forth in the definitive
financing documents for the financing contemplated by the Debt
Term Sheet (in which case the conditions precedent to closing in
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such definitive documents shall supersede the conditions
precedent to closing set forth in the Debt Term Sheet) shall
have been satisfied (in Buyer’s sole determination) or
waived.
(ii) Buyer shall have obtained debt financing for the
Projects and the Expansions on terms no less favorable to Buyer
than those set forth in the Debt Term Sheet, including with
respect to each of the facilities specified therein (such
facilities consisting of the senior construction term facility,
the senior cash grant bridge facility and the senior working
capital facility) and Buyer shall have received written evidence
from its lenders that as of the closing of the transactions
contemplated by this Agreement on the Closing Date the lenders
are not aware of any fact, event or circumstance that would
reasonably be expected to result in a breach of the debt
financing arrangements or prevent, delay or impair Buyer from
receiving the maximum amount of debt proceeds contemplated by
such debt arrangements (including timely receipt of all of the
advances under the facilities) (without the need for any waiver
by the lenders of any breach of the debt financing arrangements
or any condition precedent to Buyer’s receipt of proceeds
under those arrangements).
(i)
Other Conditions. The
conditions set forth in Section 10.1(i) of the Disclosure
Schedules shall have been satisfied.
The Buyer may waive any condition specified in this
Section 10.1 by executing a writing so stating at or prior
to the Closing. Such waiver shall not be considered a waiver of
any other provision in this Agreement unless the writing
specifically so states.
For purposes of determining whether the conditions to the
obligations of the Buyer set forth in
(i) Section 10.1(i)(c) of the Disclosure
Schedules (Interconnection Agreements) have been satisfied with
respect to the estimated costs for the installation of
interconnection facilities, (ii) Section 10.1(i)(f)
of the Disclosure Schedules (Engineering, Procurement and
Construction Arrangement) have been satisfied with respect to
the costs to be incurred for the installation of the Expansions,
(iii) Section 10.1(i)(h) of the Disclosure Schedules
(ARRA Grants) have been satisfied with respect to the amount of
the ARRA Grants to be received, (iv)
Section 10.1(i)(i) of the Disclosure Schedules (Treasury
Grants) have been satisfied with respect to the amount of the
Treasury Grants to be received, (v)
Section 10.1(i)(k) of the Disclosure Schedules (Water and
Sewer Agreements) have been satisfied with respect to the costs
of such services, and (vi) Section 10.1(i)(l) of the
Disclosure Schedules (RIRRC Arrangement) have been satisfied
with respect to the amount of the commitments, security and
other credit support contemplated to be provided by RIRRC under
the terms of the RIRRC Contract, the Parties shall consider each
of such conditions specifically referenced in clauses (i)
through (vi) above to have been satisfied if the actual
costs incurred or to be incurred, grants received or to be
received, and commitments, security and other credit support (as
applicable) provided or to be provided under such arrangements
to Buyer (when finalized, if not final as of the date of this
Agreement) are no less favorable to Buyer in the aggregate than
the estimated costs to be incurred, grants to be received, and
commitments, security and other credit support to be provided to
Buyer in the aggregate as set forth in the conditions referenced
in clauses (i) through (vi) above. It being understood
that any such condition may remain unsatisfied if other
provisions of such condition not specifically deemed to be
satisfied in accordance with the terms of this paragraph fail to
be met.
10.2
Conditions to Obligation of the
Sellers. The obligation of each Seller to
consummate the transactions to be performed by it in connection
with the Closing is subject to the satisfaction, on or before
the Closing Date, of each of the following conditions:
(a)
Representations and Warranties of the
Buyer. The representations and warranties of
the Buyer set forth in Section 7 that are: (
i)
qualified by materiality or Material Adverse Effect shall be
true and correct in all respects, or (
ii) not qualified
by materiality or Material Adverse Effect shall be true and
correct in all material respects, except that the
representations and warranties in Sections 7.1, 7.2 and 7.3
shall be true and correct in all respects, in each case at and
as of the date hereof and at and as of the Closing Date with the
same effect as though made at and as of such time, except that
those representations and warranties that are made as of a
specified date shall be true and correct only as of such date
and except as affected by actions taken after the date hereof
with the consent of any of the Sellers or the Sellers’
Representative.
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(b)
Performance by the Buyer. The
Buyer shall have performed and complied in all material respects
with all of the covenants, agreements, and obligations contained
herein required to be performed or complied with by it at or
before the Closing.
(c)
Regulatory Compliance. Orders
under Section 203 of the Federal Power Act shall have been
issued by FERC in a form reasonably acceptable to the Sellers in
connection with this Agreement and the transactions contemplated
by this Agreement with respect to each of the applications filed
as contemplated hereunder.
(d)
Consents. All governmental and
third party approvals, permits, and consents set forth in
Section 10.2(d) of the Disclosure Schedules shall have been
obtained or waived.
(f)
No Injunction. There shall not
be any: (
i) injunction in effect; (
ii) Law enacted
after the date hereof; or (
iii) order issued by a court
of competent jurisdiction or other Governmental Authority, which
in any such case enjoins, prohibits, or restrains the
consummation of the transactions contemplated by this Agreement.
(g)
Transaction Agreements in
Effect. The Transaction Agreements shall be,
or have been, duly executed by all parties thereto and shall be
in full force and effect.
(h)
Buyer’s Closing
Deliveries. The Buyer shall have paid the
Purchase Price required to be made by the Buyer pursuant to
Section 2.1(b)(ii) and shall have delivered the following
documents, each duly executed by the Buyer where applicable, to
the Sellers:
(i) a Transfer and Assignment Agreement for the Interests
being sold by such Seller hereunder; and
(ii) a certificate, dated as of the Closing Date, signed by
a duly authorized officer of the Buyer, certifying that the
conditions specified in Sections 10.2(a) and 10.2(b) have
been satisfied.
(i)
Other Sellers. All conditions
in this Section 10.2 shall have been satisfied or waived
with respect to all of the other Sellers by the Sellers’
Representative.
A Seller may waive any condition specified in this
Section 10.2 by executing a writing so stating at or prior
to the Closing. Such waiver shall not be considered a waiver of
any other provision in this Agreement unless the writing
specifically so states.
(a) Trust I shall indemnify Buyer, the Olinda
Companies, and the Providence Companies, and hold them harmless
from and against (without duplication, and only to the extent
reserves therefore have not otherwise reduced the Purchase Price
through their inclusion as a Current Liability in the
determination of Closing Date Working Capital of the Olinda
Company Group), any Losses attributable to (i) all Taxes
(or the non-payment thereof) of the Olinda Companies for all
taxable periods ending on or before the Closing Date and the
portion through the end of the Closing Date for any taxable
period that includes (but does not end on) the Closing Date (a
“Pre-Closing Tax Period”), (ii) all
Taxes of any member of an affiliated, consolidated, combined or
unitary group of which any of the Olinda Companies (or any
predecessor of any of the foregoing) is or was a member on or
prior to the Closing Date, including pursuant to Treasury
Regulation § 1.1502-6 or any analogous or similar
state, local, or
non-U.S. law
or regulation and (iii) any and all Taxes of any Person
(other than the Olinda Companies) imposed on the Olinda
Companies as a transferee or successor, by contract or pursuant
to any law, rule, or regulation, which Taxes relate to an event
or transaction occurring before Closing.
(b) Each Providence Seller shall severally (not jointly and
not joint and severally) indemnify Buyer, the Olinda Companies,
and the Providence Companies, and hold them harmless from and
against (without duplication, and only to the extent reserves
therefore have not otherwise reduced the Purchase Price through
their inclusion as a Current Liability in the determination of
Closing Date Working Capital of the Providence
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Company Group) any Losses attributable to (i) all Taxes
(or the non-payment thereof) of the Providence Companies for all
Pre-Closing Tax Periods, (ii) all Taxes of any member of
an affiliated, consolidated, combined or unitary group of which
any of the Providence Companies (or any predecessor of any of
the foregoing) is or was a member on or prior to the Closing
Date, including pursuant to Treasury Regulation
§ 1.1502-6 or any analogous or similar state, local,
or
non-U.S. law
or regulation, and (iii) any and all Taxes any Person
(other than the Providence Companies) imposed on the Providence
Companies as a transferee or successor, by contract or pursuant
to any law or resolution, which Taxes relate to an event or
transaction occurring before Closing.
(c) In the case of any taxable period that includes (but
does not end on) the Closing Date (a ‘‘Straddle
Period”), the amount of any Taxes based on or measured
by income or receipts of the Olinda Companies or the Providence
Companies for the Pre-Closing Tax Period shall be determined
based on an interim closing of the books as of the close of
business on the Closing Date (and for such purpose, the taxable
period of any partnership or other pass-through entity in which
the Olinda Companies or the Providence Companies holds a
beneficial interest shall be deemed to terminate at such time),
and the amount of other Taxes of the Olinda Companies and the
Providence Companies for a Straddle Period that relates to the
Pre-Closing Tax Period shall be deemed to be the amount of such
Tax for the entire taxable period multiplied by a fraction the
numerator of which is the number of days in the taxable period
ending on the Closing Date and the denominator of which is the
number of days in such Straddle Period. Any Taxes not
attributable to the
Pre-Closing
Tax Period shall constitute “Post-Closing Tax Period
Taxes.”
(d) The Buyer shall be responsible for and shall pay or
reimburse the Sellers for the Post-Closing Tax Period Taxes.
(e) Trust I shall cause Brea Parent and the Providence
Sellers shall cause RILG, to prepare and timely file, or cause
to be prepared and timely filed, the final federal, state or
local income Tax Return of the applicable Company for any
taxable period ending on the Closing Date. The Buyer shall
prepare and timely file or shall cause to be prepared and timely
filed by the Companies all other Tax Returns that are required
to be filed by or with respect to the Companies or in respect to
their respective business, assets or operations and shall be
responsible for all taxes due in respect of such Tax Returns.
(f) The Buyer and each of the Sellers agree to cooperate
and share, before, at and after the Closing, all required
information on a timely basis in order to timely file all Tax
Returns, reports, returns, schedules and any other documents
required to be filed with respect to Taxes and all claims for
refunds of Taxes and for the preparation of any audit, and for
the prosecution or defense of any claim or proceeding relating
to any proposed adjustment. The Buyer and each of the Sellers
agree to retain or cause to be retained all Tax Returns and
books and records pertinent to the Companies and the Interests
until the applicable period for assessment under applicable Law
(giving effect to any and all extensions or waivers) has
expired, and to abide by or cause the abidance with all record
retention agreements entered into with any Governmental
Authority. After the Closing, the Buyer, on the one hand, and
each of the Sellers, on the other hand, shall give each other
reasonable notice prior to transferring, discarding or
destroying any such Tax Returns and books and records relating
to Tax matters, and shall allow each other upon request to take
possession of such Tax Returns, and books and records at the
requesting Party’s expense. The Buyer, on the one hand, and
each of the Sellers, on the other hand, shall cooperate with
each other in the conduct of any audit or other proceedings
involving any of the Companies or any of the Interests for any
Tax purpose. The Sellers shall have the sole right to represent
the Companies’ interests in any audit or examination by any
Governmental Authority (“Tax Audit”) to the
extent that such Tax Audit relates to U.S. federal, state
or local income Taxes with respect to taxable periods ending on
or before the Closing and to employ counsel of their choice at
their expense. At the request of any Seller with respect to a
Company sold by it hereunder, or of the Sellers’
Representative, the Buyer shall cause such Company to make or
join with such Seller in making elections with respect to its
Tax Returns for periods ending on or before the Closing;
provided, however, that the making of such
election does not have a Material Adverse Effect in relation to
the Companies taken as a whole for any post-Closing Tax period.
(g) All excise, sales, use, transfer (including real
property transfer or gains), stamp, documentary, filing,
recordation and other similar taxes, together with any interest,
additions or penalties with respect thereto and
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any interest in respect of such additions or penalties (the
‘‘Transfer Taxes”), resulting from the
transfer of the Interests pursuant to this Agreement shall be
borne by the Buyer.
(h) The Parties agree that the Purchase Price and any other
relevant items shall be allocated among the Assets in accordance
with Section 1060 of the Code and the Treasury regulations
thereunder. Within sixty days after the Closing Date, the Buyer
shall prepare and deliver to the Sellers’ Representative an
allocation schedule allocating the Purchase Price and any such
other relevant items among the Assets (the “Allocation
Schedule”). The Allocation Schedule shall be final and
binding on the Parties unless, within thirty days after delivery
thereof to the Sellers’ Representative, the Sellers’
Representative delivers a written notice to the Buyer of its
objections to the Allocation Schedule, in which case the Buyer
and the Sellers’ Representative shall attempt in good faith
to resolve such dispute between them. If the Buyer and the
Sellers’ Representative are unable to resolve such dispute
within thirty days thereafter, then the Buyer and the
Sellers’ Representative shall submit all such disputed
items for resolution to the Accountants, whose decision shall be
final and binding upon all Parties. The fees of the Accountants
shall be shared equally by the Buyer, on the one hand, and the
Sellers, on the other hand. The Buyer and each of the Sellers
shall (i) be bound by the Allocation Schedule (as
adjusted) for purposes of determining any Taxes, (ii)
prepare and file their Tax Returns on a basis consistent with
the Allocation Schedule, and (iii) take no position
inconsistent with the Allocation Schedule on any Tax Return or
in any proceeding before any taxing authority; provided,
however, that nothing contained herein shall prevent the
Buyer and the Sellers from settling any proposed deficiency or
adjustment by any Governmental Authority based upon or arising
out of the Allocation Schedule, and neither the Buyer nor any
Seller shall be required to litigate before any court, any
proposed deficiency or adjustment by any Governmental Authority
challenging the Allocation Schedule. Notwithstanding anything to
the contrary in this Agreement, the Parties agree that the draft
Allocation Schedule and the final Allocation Schedule shall be
consistent with the allocation of the Purchase Price among the
Interests as set forth in Section 2.1 hereto and provide
that: (i) an amount of the Purchase Price that is
allocated to the unrealized receivables of the Companies shall
not exceed the face value of such unrealized receivables as of
the Closing Date and (ii) an amount of the Purchase Price
that is allocated to the inventory of the Companies shall not
exceed the book value of such inventory as of the Closing Date.
(i) All Production Tax Credits accruing with respect to a
Company under Section 45 of the Code on or prior to the
Closing Date shall be allocated to and for the benefit of the
Seller or Sellers of such Company, and all Production Tax
Credits accruing after the Closing Date shall be allocated to
and for the benefit of the Buyer.
12.1 Survival of Representations and Warranties;
Survival of Covenants and Agreements. The
representations and warranties in this Agreement (including the
Schedules and Exhibits hereto), and the covenants and agreements
in this Agreement and the Employee Transfer Agreement
contemplating performance prior to the Closing, shall survive
the Closing for nine (9) months. Covenants and agreements
in this Agreement (including the Schedules and Exhibits hereto)
and in the Employee Transfer Agreement, that contemplate
performance following the Closing shall survive the Closing in
accordance with their terms; provided that any
representation, warranty or covenant in respect of which
indemnity may be sought hereunder, and the indemnity with
respect thereto, shall survive the time at which it would
otherwise terminate pursuant to this Section 12.1 (but only
with respect to the particular claim for which notice has been
given) if notice of the inaccuracy or breach or potential
inaccuracy or breach thereof giving rise to such right or
potential right to indemnity shall have been given to the Party
against whom such indemnity may be sought prior to such time
(regardless of when Losses in respect thereof may actually be
incurred). The representations and warranties set forth in this
Agreement (including the Exhibits and Schedules hereto) shall
survive for the applicable periods set forth in this
Section 12.1 and shall in no event be affected by any
investigation, inquiry or examination made for or on behalf of
any Party, or the Knowledge of any Party’s officers,
directors, stockholders, employees or agents or the acceptance
by any Party of any certificate or opinion hereunder.
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(a)
Indemnification by
Trust I. Subject to Section 12.2(c)
and 12.3, following the Closing, Trust I agrees to and
shall indemnify the Buyer Parties and save and hold each of them
harmless against and pay on behalf of or reimburse such Buyer
Parties as and when incurred for any Losses which any such Buyer
Party may suffer, sustain or become subject to, as a result of,
in connection with, relating or incidental to or by virtue of:
(
i) any breach by Trust I of any representation or
warranty made by Trust I in this Agreement or any of the
Schedules or Exhibits attached hereto, or in any of the
certificates furnished by Trust I pursuant to this
Agreement (determined without regard to any Material Adverse
Effect or other materiality qualifiers contained therein);
(
ii) any breach of any covenant or agreement by
Trust I under this Agreement or any of the Schedules and
Exhibits attached hereto, or in any of the certificates
furnished by Trust I pursuant to this Agreement;
(
iii) any Indebtedness or Selling Expenses of
Trust I; or (
iv) any of the matters relating to the
Employee Transfer Agreement set forth on Section 12.2(a) of
the Disclosure Schedules (to the extent such matters are not
otherwise the subject of representations or warranties contained
in the third sentence of Section 4.9(a) or the second
sentence of Section 4.9(b), in which case they will be
covered by Section 12.2(a)(i) above and will be subject to
the Olinda Deductible).
(b)
Indemnification by Providence
Sellers. Subject to Section 12.2(c) and
12.3, following the Closing, each Providence Seller agrees to
and shall indemnify the Buyer Parties and save and hold each of
them harmless against and pay on behalf of or reimburse such
Buyer Parties as and when incurred for any Losses which any such
Buyer Party may suffer, sustain or become subject to, as a
result of, in connection with, relating or incidental to or by
virtue of: (
i) any breach by such Providence Seller of
any representation or warranty made by such Providence Seller in
this Agreement or any of the Schedules or Exhibits attached
hereto, or in any of the certificates furnished by such
Providence Seller pursuant to this Agreement (determined without
regard to any Material Adverse Effect or other materiality
qualifiers contained therein); (
ii) any breach of any
covenant or agreement by such Providence Seller under this
Agreement or any of the Schedules and Exhibits attached hereto,
or in any of the certificates furnished by such Providence
Seller pursuant to this Agreement; (
iii) any Indebtedness
or Selling Expenses of such Providence Seller; or (
iv)
any of the matters relating to the Employee Transfer Agreement
set forth on Section 12.2(b) of the Disclosure Schedules
(to the extent such matters are not otherwise the subject of
representations or warranties contained in the third sentence of
Section 5.9(a) or the second sentence of
Section 5.9(b), in which case they will be covered by
Section 12.2(b)(i) above and will be subject to the
Providence Deductible). The obligations of the Providence
Sellers under this Section 12.2(b) are several obligations,
and not joint obligations, and not joint and several obligations.
(c)
Monetary Limitations on Indemnification by
Trust I and Providence
Sellers. Trust I shall not have any
liability under Section 12.2(a)(i) above (other than with
respect to Trust I’s representations and warranties
under Sections 3 (including each of its subsections), 4.1,
4.2, and 4.14 (collectively, the “
Olinda Specified
Representations and Warranties”)), unless the aggregate
amount of all Losses relating thereto for which all Trust I
would, but for this proviso, be liable exceeds on a cumulative
basis an amount equal to Two Hundred Thousand Dollars ($200,000)
(the “
Olinda Deductible”), and then
Trust I shall be liable only for all such Losses in excess
of the Olinda Deductible;
provided further that
Trust I’s aggregate liability under
Section 12.2(a)(i) (other than with respect to the Olinda
Specified Representations and Warranties) and
Section 12.2(a)(iv), shall in no event exceed the amount of
, and Buyer shall have no source of indemnification payments for
claims against Trust I other than, the Olinda Indemnity
Holdback (with it being understood, however, that nothing in
this Agreement (including this Section 12.2(c)) shall limit
or restrict any of the Buyer Parties’ right to maintain or
recover any amounts in connection with any action or claim based
upon fraud). No Providence Seller shall have any liability under
12.2(b)(i) above (other than with respect to such Providence
Seller’s representations and warranties under
Sections 3 (including each of its subsections), 5.1, 5.2,
and 5.14 (collectively, the “
Providence Specified
Representations and Warranties”)), unless the aggregate
amount of all Losses relating thereto for which all or any of
the Providence Sellers would, but for this proviso, be liable
exceeds on a cumulative basis an amount equal to Three Hundred
Thousand Dollars ($300,000) (the “
Providence
Deductible”), and then such Providence Seller shall be
liable only for all such Losses in excess of the Providence
Deductible;
provided further that the Providence
Sellers’ aggregate liability under Section 12.2(b)(i)
(other than with respect to Providence Specified Representations
and Warranties) and Section 12.2(b)(iv) shall in no event
exceed the amount of, and Buyer shall have no source of
indemnification
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payments for claims against the Providence Sellers other than,
the Providence Indemnity Holdback (with it being understood,
however, that nothing in this Agreement (including this
Section 12.2(c)) shall limit or restrict any of the Buyer
Parties’ right to maintain or recover any amounts in
connection with any action or claim based upon fraud);
provided further no claim shall be made by the
Buyer Parties under Section 12.2(a)(i) or 12.2(b)(i), or
count towards the Deductible, unless such claim is for an amount
greater than Five Thousand Dollars ($5,000)).
(d)
Indemnification by
Buyer. Subject to Section 12.3,
following the Closing, the Buyer shall indemnify, defend, and
hold harmless each Seller, its Affiliates, its and their
successors and permitted assigns, and all of their respective
shareholders, trustees, directors, managers, members, officers,
employees, agents, and representatives (collectively, the
“
Seller Indemnified Parties”) from and against
all Liabilities, obligations, judgments, Liens, injunctions,
charges, orders, decrees, rulings, damages, assessments, Taxes,
losses, fines, penalties, damages, expenses, fees, costs,
claims, and amounts paid in settlement (including reasonable
consultants’, attorneys’ and expert witness fees and
disbursements in connection with investigating, defending or
settling any action or threatened action) (collectively,
‘‘
Losses”) incurred or sustained by any
Seller Indemnified Party as a result of (
i) any
breach by the Buyer of any representation or warranty made by
the Buyer in this Agreement or any of the Schedules or Exhibits
attached hereto, or in any of the certificates furnished by
Buyer pursuant to this Agreement (determined without regard to
any Material Adverse Effect or other materiality qualifiers
contained therein), or (
ii) any breach of any
covenant or agreement by the Buyer under this Agreement or any
of the Schedules and Exhibits attached hereto, or in any of the
certificates furnished by the Buyer pursuant to this Agreement.
(a) Any calculation of a Loss under this Section 12
shall, in each case, give full effect to any and all insurance
proceeds actually received (net of any increase in premiums
payable or taxes payable as a result of the receipt of such
proceeds) to the applicable indemnified party in respect of such
Loss.
(b) Each Person entitled to indemnification hereunder or
otherwise to reimbursement for Losses in connection with the
transactions contemplated by this Agreement shall use
commercially reasonable efforts to mitigate any Losses incurred
or sustained by such indemnified party upon becoming aware of
any event that would reasonably be expected to give rise thereto.
(c) Notwithstanding anything herein to the contrary, in no
event shall the liability of (i) Trust I for
indemnification hereunder for breach of any or all
representations or warranties exceed, in the aggregate, the
Olinda Purchase Price, or (ii) the Providence Sellers for
indemnification hereunder for breach of any or all
representations or warranties exceed, in the aggregate, the
Providence Purchase Price.
(d) Notwithstanding anything herein to the contrary, in no
event (whether or not this Agreement has been terminated) shall
Buyer, the Buyer Parties (including, without limitation, the
Sponsors and their respective former, current or future general
or limited partners, stockholders, managers, members, directors,
officers, Affiliates or agents) either individually or in the
aggregate, be subject to any liability in excess of the Purchase
Price in the aggregate for all losses or damages relating to or
arising out of this Agreement or the transactions contemplated
by this Agreement, including breaches by Buyer of any
representations, warranties, covenants or agreements contained
in this Agreement. The Sellers understand and acknowledge that
their sole remedy against Buyer for breaches of this Agreement
shall be money damages (as opposed to specific performance)
subject to the limitations set forth herein.
(e) Notwithstanding anything herein to the contrary, in no
event shall a breach of the representations and warranties
contained in Section 3.6 hereof give rise to any obligation
on the part of any Seller to indemnify a Buyer Party except to
reimburse such Buyer Party for any Losses suffered by such Buyer
Party as a result of a Third Party Claim arising from such
breach.
(a)
Third Party Claims. Any person
making a claim for indemnification under this Article XII
(an “
Indemnitee”) shall promptly notify the
indemnifying Party (an ‘‘
Indemnitor”) in
writing of a third party claim
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or the commencement of any action by any third party (a
“Third Party Claim”), describing the claim, the
amount thereof (if known and quantifiable) and the basis
thereof; provided that no delay on the part of such
Indemnitee in notifying the Indemnitor shall relieve the
Indemnitor from any obligation hereunder unless (and then solely
to the extent) the Indemnitor is actually materially prejudiced
by such delay. Upon receipt of such notice, the Indemnitor shall
be entitled to participate in such claim or action, to assume
the defense thereof with counsel reasonably satisfactory to the
Indemnitee and to settle or compromise such claim or action, so
long as (i) the Third Party Claim involves only money
damages and does not seek an injunction or other equitable
relief or arise in connection with any criminal or
quasi-criminal proceeding, (ii) an adverse judgment with
respect to the Third Party Claim is not, in the reasonable
judgment of the Indemnitee, likely to establish a precedential
custom or practice adverse to, or otherwise be detrimental to,
the continuing business interests, reputation or future business
prospects of the Indemnitee, (iii) the Indemnitee has not
been advised by counsel that a reasonable likelihood exists of a
conflict of interest between Indemnitor and Indemnitee,
(iv) the Indemnitee does not reasonably believe that the
Loss relating to the Third Party Claim could exceed the maximum
amount that such Indemnitee could then be entitled to recover
from the Sellers or the Companies under the applicable
provisions of this Article XII, and (v) the
Indemnitor conducts the defense of the Third Party Claim
actively and diligently; provided, that the Indemnitor
shall not consent to the entry of any judgment or enter into any
settlement with respect to the Third Party Claim unless
(i) written agreement is obtained expressly and
unconditionally releasing the Indemnitee from all liability
thereunder, and (ii) pursuant to or as a result of such
judgment or settlement, no injunctive or other equitable relief
will be imposed against the Indemnitee; provided,
further, that if the Indemnitee has elected to be
represented by separate counsel pursuant to the proviso to the
following sentence, such settlement or compromise shall be
effected only with the consent of the Indemnitee, which consent
shall not be unreasonably withheld or delayed. After notice to
the Indemnitee of the Indemnitor’s election to assume the
defense of such claim or action, the Indemnitor shall not be
liable to the Indemnitee under Section 12.4 for any legal
or other expenses subsequently incurred by the Indemnitee in
connection with the defense thereof other than reasonable costs
of investigation; provided, however, that the
Indemnitee shall have the right to employ counsel, and the fees
and expenses of such separate counsel shall be paid by the
Indemnitor, if either (A) such claim or action involves
remedies other than monetary damages and such remedies, in the
Indemnitee’s reasonable judgment, could have a material
adverse effect on such Indemnitee or (B) the Indemnitee
may have available to it one or more defenses or counterclaims
that are inconsistent with one or more defenses or counterclaims
which may be alleged by the Indemnitor. If the Indemnitor does
not elect to assume the defense of such Third Party Claim within
thirty days of receipt of the Indemnitee’s notice of such
Third Party Claim, or is not entitled to assume the defense
under this Section 12.4, the Indemnitee shall be entitled
to assume the defense thereof. Unless it has been conclusively
determined through a final judicial determination (or settlement
tantamount thereto) that the Indemnitor is not liable to the
Indemnitee under Section 12.4, the Indemnitee shall act
reasonably and in accordance with its good faith business
judgment with respect to such defense, and shall not settle or
compromise any such claim or action without the consent of the
Indemnitor, which consent shall not be unreasonably withheld or
delayed. The Parties agree to render to each other such
assistance as may reasonably be requested in order to insure the
proper and adequate defense of any such Third Party Claim.
(b)
Other Claims. Promptly after
an Indemnitee incurs or sustains any Loss not involving a Third
Party Claim, such Indemnitee shall deliver notice of such Loss
to the Indemnitor, specifying with reasonable detail the amount
of such Loss, and a description in reasonable detail of the
facts giving rise to such Loss to the extent then known to such
Indemnitee;
provided that no delay on the part of such
Indemnitee in notifying the Indemnitor shall relieve the
Indemnitor from any obligation hereunder unless (and then solely
to the extent) the Indemnitor is actually materially prejudiced
by such delay.
(c)
Sellers’ Representative Acts for the
Sellers. Notices required to be given to any
Seller Indemnified Party pursuant to this Section 12 may be
given to, and actions, elections and consents permitted by this
Section 12 to be taken, made, or given by any Seller
Indemnified Party may be taken, made, or given by, the
Sellers’ Representative.
12.5
Remedies Exclusive. The
remedies provided for in Section 11 and this
Section 12 shall constitute the sole and exclusive remedy
among the parties hereto for any post-Closing claims made for
breach of this
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Agreement or any of the Schedules or Exhibits attached hereto or
in any certificates or other instruments or documents furnished
by any party pursuant to this Agreement, except in the case of
fraud.
12.6
Manner of Payment. Except as
otherwise provided herein, any indemnification of the Buyer
Parties or Seller Indemnified Parties shall be effected by wire
transfer of immediately available funds from the applicable
Seller or Sellers, or the Buyer, as the case may be, to an
account designated by the applicable Buyer Party or Seller
Indemnified Party, as the case may be, within fifteen
(15) Business Days after the determination thereof. Any
such indemnification payments shall include interest at the
Interest Rate calculated on the basis of the actual number of
days elapsed over three hundred sixty (360), from the date any
such Loss is suffered or sustained to the date of payment. Buyer
must recover any amounts owing to it pursuant to Section 11
or this Section 12 by first retaining an amount equal to
what it is owed from the applicable Indemnity Holdback, and
then, subject to Section 12.3(c), making a claim directly
against the Sellers (as applicable). All indemnification
payments shall be deemed adjustments to the Olinda Purchase
Price or Providence Purchase Price, as applicable. Buyer shall
release and pay to the Sellers’ Representative, for the
benefit of the Sellers, any amounts not the subject of a dispute
that remain in the applicable Indemnity Holdback within ten
(10) Business Days following the date that is nine
(9) months after the Closing Date. Any amounts that are the
subject of a dispute will be retained by Buyer until such
dispute is finally resolved and then Buyer shall either retain
such funds or pay such funds to the Sellers’ Representative
for the benefit of the Sellers in accordance with the resolution
of such dispute.
13.1
Termination of
Agreement. This Agreement constitutes the
binding and irrevocable agreement of the Parties and may only be
terminated as follows:
(a) the Sellers’ Representative (on behalf of the
Sellers) and the Buyer may terminate this Agreement by mutual
written consent at any time prior to the Closing;
(b) either the Buyer or the Sellers’ Representative
(on behalf of the Sellers) may terminate this Agreement by
giving written notice to the other Party at any time prior to
the Closing if any of the following has occurred: (i)
(A) the other Party has breached any of its covenants or
agreements contained in this Agreement to be complied with by it
such that the closing condition set forth in
Section 10.1(b) (with respect to Seller breaches) and
10.2(b) (with respect to Buyer breaches) would not be satisfied
or (B) there exists a breach of or an inaccuracy in any
of the representations and warranties of the other Party
contained in this Agreement such that the closing condition set
forth in Section 10.1(a) (with respect to Seller breaches)
and 10.2(a) (with respect to Buyer breaches) would not be
satisfied and in the case of clause (A) or clause (B), such
breach is incapable of being cured, or if capable of being
cured, shall not have been cured prior to the earlier of
(x) the Termination Date and (y) 30 days
after notice of the breach is provided to the breaching Party;
(ii) the Closing shall not have occurred on or before the
Termination Date by reason of the failure of any condition
precedent under Section 10.1 or Section 10.2, unless
the failure results primarily from the Party seeking to
terminate this Agreement itself breaching any representation,
warranty, or covenant or failing to fulfill any of its
obligation contained in this Agreement; (iii) one or more
courts of competent jurisdiction shall have issued an order,
judgment, or decree permanently restraining, enjoining, or
otherwise prohibiting the Closing, which order, judgment, or
decree shall not have been terminated, lifted, vacated or
otherwise rendered irrelevant within ninety days of the issuance
thereof; provided, however, that the Party seeking
to terminate this Agreement pursuant to this
Section 13.1(b) shall have used commercially reasonable
efforts to prevent the entry of and to remove such order,
judgment or decree; or (iv) any Law shall have been
enacted by any Governmental Authority that, directly or
indirectly, enjoins, prohibits, or restrains the consummation of
the transactions contemplated hereby;
(c) by Buyer if: (i) RRP has failed to include the
Olinda Recommendation in the Consent Statement to be delivered
to Trust I shareholders, or withdraws, modifies, or changes
such recommendation at any time, or RRP has failed to include
the Providence Recommendation in any Consent Statement to be
delivered to the shareholders of Trust I, Trust III,
Trust IV or B Fund, or withdraws, modifies or changes such
recommendation at any time, or (ii) RRP approves,
recommends or adopts an Alternative
A-64
Transaction or approves or recommends that holders of shares of
the applicable Seller tender their shares in any tender offer or
exchange offer that is an Alternative Transaction;
(d) the Sellers’ Representative (on behalf of the
Sellers) may terminate this Agreement by written notice to the
Buyer if, prior to obtaining all of the Shareholder Approvals,
(i) any Seller receives a Superior Proposal, (ii)
RRP, as the managing shareholder of the Trusts, determines, in
good faith (after consultation with outside legal counsel), that
the failure to accept such Superior Proposal would be
inconsistent with its fiduciary duties to the shareholders of
the applicable Trusts under the governing Trust documents and
applicable Law, (iii) the Sellers and the Companies have
complied in all respects with Section 8.8, and (iv)
the Sellers pay the Termination Fee in accordance with
Section 13.2(c);
(e) either Buyer or the Sellers’ Representative (on
behalf of the Sellers) may terminate this Agreement if any of
the Shareholder Approvals are not obtained by a Seller within
thirty (30) days after such Seller sends a Consent
Solicitations to its shareholders; and
(f) by Buyer, if the Sellers’ Representative has
failed to mail or cause to be mailed the Consent Statements in
the time period required by Section 8.2(b) or in the event
that RRP has made a Financing Delay Determination and such delay
has not been eliminated within the time period specified in
Section 8.11(c); and
(g) by Buyer if the sum of the Olinda Swap Rate Adjustment
and the Providence Swap Rate Adjustment would result in a
decrease in Purchase Price by more than Five Million Dollars
($5,000,000) (in the absence of the proviso set forth in the
second sentence of Section 2.9).
(a) If any Party terminates this Agreement pursuant to
Section 13.1, all rights and obligations of the Parties
hereunder shall terminate without any Liability of any Party to
the other Parties (except as otherwise expressly provided
herein).
(b) Nothing in this Section 13 shall be deemed to
impair the right of Buyer to compel specific performance by the
Sellers of their obligations under this Agreement, or shall be
deemed to release the Parties from any Liability, for any
willful breach of this Agreement (including a breach of the
terms and provisions of the Confidentiality Agreement
incorporated by reference therein).
(c) If this Agreement is terminated pursuant to
Section 13.1(d) then the Sellers shall pay to Buyer (or as
directed by Buyer), (by wire transfer of immediately available
funds) an amount equal to One Million One Hundred Twenty Five
Thousand Dollars ($1,125,000) (the “Termination
Fee”); provided, however, that such
termination shall not be effective until the Sellers pay the
Termination Fee. If this Agreement is terminated pursuant to
Section 13.1(c) then the Sellers shall pay to Buyer (or as
directed by Buyer), (by wire transfer of immediately available
funds), the Termination Fee as promptly as practicable (and in
any event within two (2) Business Days following such
termination). If this Agreement is terminated pursuant to
Section 13.1(e), then, in the event that, within twelve
(12) months of the termination of this Agreement, the
Sellers or the Companies enter into a definitive agreement with
respect to an Alternative Transaction or an Alternative
Transaction is consummated, then the Sellers and the Companies
shall pay, or cause to be paid, to Buyer, by wire transfer of
same day funds, the Termination Fee, such payment to be made
upon the earlier to occur of the execution of a definitive
agreement relating to, or consummation of, such Alternative
Transaction. In addition, if this Agreement is terminated
pursuant to Section 13.1(c), Section 13.1(d) or
Section 13.1(e) , then the Sellers shall reimburse Buyer
for the reasonable and documented
out-of-pocket
costs, fees and expenses incurred by Buyer (or its Affiliates)
in connection with this Agreement and the Transactions
contemplated hereby (the ‘‘Buyer
Expenses”), upon presentation of written evidence that
the Buyer Expenses have been paid by the Buyer, with such
reimbursement payable by wire transfer of same day funds to
Buyer (or as directed by Buyer) within two (2) Business
Days following the date of such termination.
(d) The Sellers acknowledge that the agreements contained
in this Section 13.2 are an integral part of the
transactions contemplated by this Agreement and that, without
these agreements, Buyer would not enter into this Agreement. If
Sellers or the Companies fail to pay the Termination Fee or the
Buyer Expenses when due,
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and, in order to obtain such payment Buyer (or its Affiliates)
commences a suit which results in a judgment against the Sellers
or the Companies for all or any portion of the Termination Fee
or the Buyer Expenses, the Sellers shall pay to Buyer its
reasonable
out-of-pocket
costs and expenses (including reasonable attorneys’ fees)
in connection with such suit.
(e) If this Agreement is terminated because the
Buyer’s proposed lenders will not fund the amounts
contemplated by the financing arrangements set forth in the debt
financing commitments referred to in Section 8.11(c) and as
of the date of such indication the Conditions to the Obligations
of Buyer set forth in Section 10.1 which are capable of
satisfaction as of such date have been satisfied, then Buyer
shall reimburse the Sellers for fifty percent (50%) of the
reasonable documented
out-of-pocket
costs and expenses (i) which the Sellers (or any of them)
have paid or are obligated to pay as of such termination date
under the EPC Contracts, up to and including a maximum amount
equal to Three Hundred Seventy Five Thousand Dollars ($375,000),
and (ii) which the Sellers (or any of them) have paid or
are obligated to pay to RIRRC under the RIRRC Contract, up to
and including a maximum amount equal to Two Hundred Fifty
Thousand Dollars ($250,000).
(f) The provisions of Section 14 shall survive any
such termination.
14.1 Press Releases and Public
Announcements. No Party shall issue any press
release or make any public announcement relating to the subject
matter of this Agreement prior to the Closing without first
affording the non-disclosing Parties reasonable opportunity to
review and comment on such press release or public announcement;
provided that any Party may make any public disclosure it
believes in good faith is required by applicable Law or any
listing or trading agreement concerning its securities (in which
case the disclosing Party shall use its reasonable efforts to
provide the other Parties with reasonable opportunity to review
in advance the disclosure).
14.2 No Third Party
Beneficiaries. Except as contemplated in
Section 12 hereof, this Agreement shall not confer any
rights or remedies upon any Person that is not a Party or a
successor or permitted assign of a Party.
14.3
No Joint Venture. Nothing in
this Agreement creates or is intended to create an association,
trust, partnership, joint venture, or other entity or similar
legal relationship among the Parties, or impose a trust,
partnership or fiduciary duty, obligation, or liability on or
with respect to any Party. Except as otherwise expressly
provided herein, no Party is or shall act as or be the agent or
Representative of any other Party.
14.4
Entire Agreement. This
Agreement (including the Exhibits, Annexes and Disclosure
Schedules hereto), together with the other Transaction
Agreements, constitute the entire agreement among the Parties
and supersede any prior understandings, agreements, or
representations by or among the Parties, written or oral, to the
extent they relate in any way to the subject matter hereof;
provided,
however, that the Confidentiality
Agreement will remain in full force and effect pursuant to the
terms thereof without regard to any provision of this Agreement.
14.5
Succession and
Assignment. This Agreement shall be binding
upon and inure to the benefit of the Parties and their
respective successors and permitted assigns;
provided,
however, that any assignment or transfer, by operation of
law or otherwise, by any Party shall require the prior written
consent of the Buyer (in the case of an assignment or transfer
by any Seller) or each of the Sellers (in the case of an
assignment or transfer by the Buyer), and any purported
assignment or other transfer without such consent shall be void
and unenforceable; provided, further, that no such consent shall
be required for Buyer to assign this Agreement to its Affiliates
or lenders.
14.6
Counterparts. This Agreement
may be executed in one or more counterparts, each of which shall
constitute one and the same instrument.
14.7
Headings; Interpretation. The
section headings contained in this Agreement are inserted for
convenience only and shall not be deemed to alter or affect in
any way the meaning or interpretation of this Agreement.
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14.8
Notices. All notices,
requests, demands, claims, and other communications hereunder
shall be in writing and shall be deemed duly given or made to a
Party as follows: (
i) upon confirmation of transmission
if sent by facsimile transmission, with a copy mailed on the
same day in the manner provided in clauses (ii) or (iii);
(
ii) one Business Day following the date sent when sent
by overnight delivery by a reputable overnight air courier; and
(
iii) five Business Days following the date mailed
when mailed by registered or certified mail return receipt
requested and postage prepaid, and shall be given or made to the
addresses set forth for such Party on
Annex 11
hereto. Any Party may change the address to which notices,
requests, demands, claims, and other communications hereunder
are to be delivered by giving the other Parties notice in the
manner herein set forth.
14.9
Governing Law. This Agreement
shall be governed by the laws of the State of
New York, without
giving effect to its principles or rules of conflict of laws to
the extent such principles or rules are not mandatorily
applicable by statute and would require or permit the
application of the laws of another jurisdiction.
(a) Each of the Parties hereby irrevocably and
unconditionally submits, for itself and its property, to the
exclusive jurisdiction of the courts of the state of
New York
sitting in
New York County and of the United States District
Court of the Southern District of
New York, and any appellate
court from any thereof, in any action or proceeding arising out
of or relating to this Agreement or the transactions
contemplated hereby or for recognition or enforcement of any
judgment relating thereto, and each of the Parties hereby
irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and
determined in such
New York State court or, to the extent
permitted by law, in such federal court. Each of the Parties
agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions
by suit on the judgment or in any other manner provided by law.
(b) Each of the Parties hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection that it may now or hereafter
have to the laying of venue of any suit, action, or proceeding
arising out of or relating to this Agreement or the transactions
contemplated hereby in any
New York State or federal court. Each
of the Parties hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
(c) Each of the Parties irrevocably consents to service of
process in the manner provided for notices in Section 14.8.
Nothing in this Agreement shall affect the right of any Party to
serve process in any other manner permitted by applicable law.
(a) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
(b) EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT: (I)
NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF THE
FOREGOING WAIVERS, (II) IT UNDERSTANDS AND HAS CONSIDERED
THE IMPLICATIONS OF SUCH WAIVERS, (III) IT MAKES SUCH
WAIVERS VOLUNTARILY, AND (IV) IT HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 14.11.
14.12
Amendments and Waivers. This
Agreement may be modified only by a written instrument executed
by each of the Parties. Any of the terms and conditions of this
Agreement may be waived in writing
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at any time prior to the Closing Date by the Party or Parties
entitled to the benefits thereof. No waiver by any Party of any
default, misrepresentation, or breach of warranty or covenant
hereunder shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant
hereunder or affect in any way any rights arising by virtue of
any prior or subsequent such occurrence.
14.13
Severability. If any term or
provision of this Agreement is held by a court of competent
jurisdiction or any other Governmental Authority to be invalid
or unenforceable or against its regulatory policy, the remainder
of the terms and provisions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired
or invalidated.
(a) Except as otherwise expressly provided herein, whether
or not the transactions contemplated herein shall be
consummated, each of the Buyer and the Sellers shall bear its
own costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby, including
all fees and disbursements of counsel and accountants retained
by the relevant party.
(b) The Sellers and the Buyer shall each bear their own
costs for the preparation of any filing under the Federal Power
Act, except that any filing fees shall be paid equally by the
Buyer, on the one hand, and the Sellers, on the other hand.
14.15
Construction. Ambiguities or
uncertainties in the wording of this Agreement shall not be
construed for or against any Party, but shall be construed in
the manner that most accurately reflects the Parties’
intent as of the date hereof. The Parties acknowledge that they
have been represented by counsel in connection with the review
and execution of this Agreement, and, accordingly, there shall
be no presumption that this Agreement or any provision hereof be
construed against the Party that drafted this Agreement.
14.16
Disclosure Schedules. The
disclosure of any matter in any Section of the Disclosure
Schedules shall be deemed to be a disclosure for all purposes of
this Agreement (including, without limitation, to qualify,
limit, or supplement other representations and warranties
contained in this Agreement) to the extent the nature of the
matter disclosed on such Disclosure Schedules is apparent on its
face to be applicable to such other Section of the Disclosure
Schedules. The fact that any item of information is included in
the Disclosure Schedules shall not be construed as an admission
of liability under any applicable Law, or that such item or
information is required to be disclosed in or by this Agreement
or is material for purposes of this Agreement, or that the
existence of such matter would if not disclosed constitute a
breach or violation of this Agreement. Such item or information
shall not be used as a basis for interpreting the term
“material,” “materially,”
“materiality” or “Material Adverse Effect,”
or any similar qualification in this Agreement.
14.17
Specific
Performance. Notwithstanding anything to the
contrary set forth herein, the Sellers agree that irreparable
damage would occur in the event that any of the provisions of
this Agreement to be performed by them were not performed in
accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the Buyer shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this
Agreement in any court provided for in Section 14.10
hereof, in addition to any other remedy to which they are
entitled at law or in equity, without the necessity of proving
actual damages or that no adequate remedy exists at law, and
without the necessity of posting bond or other security. None of
the Sellers’ Representative, the Sellers or their
Affiliates or any Seller Indemnified Party shall be entitled to
specific performance against Buyer or any Buyer Party (including
the Sponsors).
14.18
Sellers’
Representative. The Sellers, by adopting this
Agreement and the transactions contemplated hereby, hereby
irrevocably appoint RRP as their agent and attorney-in-fact for
all purposes of this Agreement, and consent to the taking by the
Sellers’ Representative of any and all actions and the
making of any decisions required or permitted to be taken by
such representative under this Agreement. The Buyer shall be
entitled to deal exclusively with the Sellers’
Representative on all matters relating to this Agreement, and
shall be entitled to rely conclusively (without further evidence
of any kind whatsoever) on any document executed or purported to
be executed on behalf of any Seller by the Sellers’
Representative, and on any other action taken or purported to be
taken on behalf of any Seller by the Sellers’
Representative, as fully binding
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upon such Seller shareholder. The power of attorney granted
hereunder is coupled with an interest and is irrevocable. All
actions, decisions and instructions of the Sellers’
Representative shall be conclusive and binding and The Buyer
shall be entitled to rely thereon without any investigation or
inquiry. Any amounts received by the Sellers’
Representative after the Closing of the transactions
contemplated by this Agreement for the benefit of the Providence
Sellers, shall be distributed to the Providence Sellers in
proportion to their respective percentage of outstanding
membership interests of RILG set forth opposite such Providence
Seller’s name on Annex 1 hereto.
[Signature
Page Follows]
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SELLERS:
RIDGEWOOD ELECTRIC POWER
TRUST I
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By:
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Ridgewood Renewable Power, LLC, as
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Managing Shareholder
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
RIDGEWOOD OLINDA, LLC
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
RIDGEWOOD ELECTRIC POWER
TRUST III
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By:
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Ridgewood Renewable Power, LLC, as
Managing Shareholder
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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RIDGEWOOD ELECTRIC POWER
TRUST IV
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By:
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Ridgewood Renewable Power, LLC, as Managing Shareholder
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
RIDGEWOOD POWER
B FUND/PROVIDENCE EXPANSION
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By:
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Ridgewood Renewable Power, LLC, as Managing Shareholder
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
RRP:
RIDGEWOOD RENEWABLE POWER,
LLC, solely in its capacity as Sellers’
Representative
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
BREA PARENT:
BREA PARENT 2007, LLC, solely with respect to
Section 8.8
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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RILG:
RHODE ISLAND LFG GENCO, LLC, solely with respect to
Section 8.8
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
RRP:
RIDGEWOOD RENEWABLE POWER, LLC, solely with respect to
Section 8.8
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
RPMC:
RIDGEWOOD POWER MANAGEMENT LLC, solely with respect to
Section 8.8
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By:
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/s/ Xxxxxxx
X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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BUYER:
MIP II BIOPOWER LLC
By: MIP II GREENPOWER LLC
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By:
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MACQUARIE INFRASTRUCTURE
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PARTNERS II U.S., L.P.
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By:
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MACQUARIE INFRASTRUCTURE
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PARTNERS II GP LLC
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By:
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MACQUARIE INFRASTRUCTURE
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PARTNERS INC.
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Its:
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Manager and
Attorney-in-Fact
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By:
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/s/ Xxxxxxxxxxx
Xxxxxx
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Name: Xxxxxxxxxxx Xxxxxx
Name: Xxxx Xxxx
And
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By:
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MACQUARIE INFRASTRUCTURE
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PARTNERS II INTERNATIONAL, L.P.
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By:
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MACQUARIE INFRASTRUCTURE
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PARTNERS II GP LLC
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By:
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MACQUARIE INFRASTRUCTURE
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PARTNERS INC.
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Its:
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Manager and
Attorney-in-Fact
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By:
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/s/ Xxxxxxxxxxx
Xxxxxx
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Name: Xxxxxxxxxxx Xxxxxx
Name: Xxxx Xxxx
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