1
EXHIBIT 3.2
LIMITED LIABILITY COMPANY AGREEMENT
OF
NRG NORTHEAST GENERATING LLC
A Delaware Limited Liability Company
THIS LIMITED LIABILITY COMPANY AGREEMENT OF NRG NORTHEAST GENERATING LLC
(this "Agreement"), dated as of April 29, 1999 (the "Effective Date"), is
adopted, executed and agreed to, for good and valuable consideration, by the
Members (as defined below).
RECITALS
1. NRG Eastern LLC ("Eastern") and Northeast Generation Holding LLC
("Holding"), both of which are Delaware limited liability companies agree to
become Members of the Company (as defined below) for the purpose of acquiring,
operating and owning the Projects (as defined below).
2. Eastern and Holding now desire to enter into this Agreement with
respect to various matters relating to the Company.
ARTICLE 1
DEFINITIONS
1.01 DEFINITIONS. As used in this Agreement, the following terms have
the respective meanings set forth below or set forth in the Sections referred to
below:
ACQUISITIONS - the Owner Entities' acquisitions of the Projects
from the Sellers pursuant to the Asset Purchase Agreements.
ACT - the Delaware Limited Liability Company Act.
AFFECTED MEMBER - Section 9.01.
AFFILIATE - with respect to any Person, (a) each entity that such
Person Controls; (b) each Person that Controls such Person, including, in
the case of a Member, such Member's Parent; and (c) each entity that is
under common Control with such Person, including, in the case of a
Member, each entity that is Controlled by such Member's Parent.
AGREEMENT - introductory paragraph.
ALTERNATE REPRESENTATIVE - Section 6.02(a)(i).
XXXXXX KILL - Xxxxxx Kill Power LLC, a Delaware limited liability
company.
ASSET PURCHASE AGREEMENTS - (i) that certain Asset Purchase
Agreement by and between Montaup and NRG dated as of October 13, 1998,
assigned to Somerset as of November 30, 1998, (ii) that certain Asset
Sales Agreement dated as of December 23, 1998 between NiMo and NRG,
assigned to Xxxxxxx and Dunkirk as of June 1, 1999, (iii) that certain
Generating Plant and Gas Turbine Asset Purchase and Sale Agreement by and
between ConEd and NRG dated January 27, 1999, assigned to Xxxxxx Kill and
Astoria as of June 1, 1999, and (iv) that certain Asset Sales Agreement
dated as of April 1, 1999 among NiMo, RG&E and Oswego, and in each case
all ancillary agreements and documents related thereto.
ASSIGNEE - any Person that acquires a Membership Interest or any
portion thereof through a Disposition; provided, however, that, an
Assignee shall have no right to be admitted to the Company as a Member
except in accordance with Section 3.03(b)(iii).
1
2
ASTORIA - Astoria Gas Turbine Power LLC, a Delaware limited
liability company.
BANKRUPTCY OR BANKRUPT - with respect to any Person, that (a) such
Person (i) makes a general assignment for the benefit of creditors; (ii)
files a voluntary bankruptcy petition; (iii) becomes the subject of an
order for relief or is declared insolvent in any federal or state
bankruptcy or insolvency proceedings (iv) files a petition or answer
seeking for such Person a reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any Law;
(v) files an answer or other pleading admitting or failing to contest the
material allegations of a petition filed against such Person in a
proceeding of the type described in subclauses (i) through (iv) of this
clause (a); or (vi) seeks, consents to, or acquiesces in the appointment
of a trustee, receiver, or liquidator of such Person or of all or any
substantial part of such Person's properties; or (b) against such
Person, a proceeding seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any Law
has been commenced and 60 Days have expired without dismissal thereof or
with respect to which, without such Person's consent or acquiescence, a
trustee, receiver, or liquidator of such Person or of all or any
substantial part of such Person's properties has been appointed and 60
Days have expired without the appointment's having been vacated or
stayed, or 60 Days have expired after the date of expiration of a stay,
if the appointment has not previously been vacated.
BUSINESS DAY - any day other than a Saturday, a Sunday, or a
holiday on which national banking associations in Minnesota,
Massachusetts or New York are not open for business.
BUYOUT EVENT - Section 9.01.
CAPITAL ACCOUNT - the account to be maintained by the Company for
each Member in accordance with Section 4.06.
CAPITAL CONTRIBUTION - with respect to any Member, the amount of
money and the net agreed value of any property (other than money)
contributed to the Company by the Member. Any reference in this Agreement
to the Capital Contribution of a Member shall include a Capital
Contribution of its predecessors in interest.
CERTIFIED PUBLIC ACCOUNTANTS - a firm of independent public
accountants selected from time to time by the Management Committee.
CHANGE OF MEMBER CONTROL - with respect to any Member, an event
(such as a Disposition of voting securities) that causes such Member to
cease to be Controlled by such Member's Parent; provided, however, that
an event that causes any of such Member's Parents to be Controlled by
another Person shall not constitute a Change of Member Control.
CLAIM - any and all judgments, claims, causes of action, demands,
lawsuits, suits, proceedings, Governmental investigations or audits,
losses, assessments, fines, penalties, administrative orders,
obligations, costs, expenses, liabilities and damages (whether actual,
consequential or punitive), including interest, penalties, reasonable
attorney's fees, disbursements and costs of investigations, deficiencies,
levies, duties and imposts.
CODE - the Internal Revenue Code of 1986, as amended.
COMPANY - NRG Northeast Generating LLC, a Delaware limited
liability company.
CONED - Consolidated Edison Company of New York, Inc., a New York
corporation.
CONFIDENTIAL INFORMATION - information and data (including all
copies thereof) that is furnished or submitted by any of the Members or
their Affiliates, whether oral (and if oral, reduced to writing and
marked "confidential" within 10 days of disclosure), written, or
electronic, on a confidential basis to the other Members or their
Affiliates in connection with the Company, and any and all of the
activities and studies performed pursuant to this Agreement or any Asset
Purchase Agreement or Loan Document, and
2
3
the resulting information and data obtained from those studies.
Notwithstanding the foregoing, the term "Confidential Information" shall
not include any information that:
(a) is in the public domain at the time of its
disclosure or thereafter (other than as a result of a disclosure
directly or indirectly by a Member or its Affiliates in
contravention of this Agreement or any Project Agreement);
(b) as to any Member, was in the possession of such
Member or its Affiliates prior to the execution of this Agreement;
or
(c) is engineering information (for example, heat
balance and capital cost information) that has been independently
acquired or developed by a Member or its Affiliates without
violating any of the obligations of such Member or its Affiliates
under this Agreement.
CONTROL - the possession, directly or indirectly of either of the
following:
(a) (i) in the case of a corporation, more than 50% of
the outstanding voting securities thereof; (ii) in the case of a
limited liability company, partnership, limited partnership or
venture, the right to more than 50% of the distributions therefrom
(including liquidating distributions); (iii) in the case of a
trust or estate, including a business trust, more than 50% of the
beneficial interest therein; and (iv) in the case of any other
entity, more than 50% of the economic or beneficial interest
therein; or
(b) in the case of any entity, the power or authority,
through ownership of voting securities, by contract or otherwise.
to exercise a controlling influence over the management of the
entity.
DAY - a calendar day; provided, however, that if any period of
Days referred to in this Agreement shall end on a Day that is not a
Business Day, then the expiration of such period shall be automatically
extended until the end of the first succeeding Business Day.
DEFAULT - the failure of a Member to comply in any material
respect with any of its material agreements, covenants or obligations
under this Agreement; the failure of any representation or warranty made
by a Member in this Agreement to have been true and correct in all
material respects at the time it was made.
DEFAULT RATE - a rate per annum equal to the lesser of (a) a
varying rate per annum equal to the sum of (i) the prime rate as
published in The Wall Street Journal, with adjustments in that varying
rate to be made on the same date as any change in that rate is so
published, plus (ii) 3% per annum, and (b) the maximum rate permitted by
Law.
DELAWARE CERTIFICATE - Section 2.01.
DISPOSE, DISPOSING OR DISPOSITION - with respect to any asset
(including a Membership Interest or any portion thereof), a sale,
assignment, transfer, conveyance, gift, exchange or other disposition
(other than the pledge or assignment to any creditor of the Company, or
any collateral agent for such creditor, of any Membership Interest as
security for the indebtedness to such creditor) of such asset, whether
such disposition be voluntary, involuntary or by operation of Law,
including the following: (a) in the case of an asset owned by a natural
person, a transfer of such asset upon the death of its owner, whether by
will, intestate succession or otherwise; (b) in the case of an asset
owned by an entity, (i) a merger or consolidation of such entity (other
than where such entity is the survivor thereof), (ii) a conversion of
such entity into another type of entity, or (iii) a distribution of such
asset, including in connection with the dissolution, liquidation,
winding-up or termination of such entity (unless, in the case of
dissolution, such entity's business is continued without the commencement
of liquidation or winding-up); and (c) a disposition in connection with,
or in lieu of, a foreclosure of an Encumbrance; but such terms shall not
include the creation of an Encumbrance.
3
4
DISPUTE - Section 10.01.
DISPUTE NOTICE - Section 10.02.
DISPUTING MEMBER - Section 10.01.
DISSOLUTION EVENT - Section 11.0 1(a).
DUNKIRK - Dunkirk Power LLC, a Delaware limited liability company.
EFFECTIVE DATE - introductory paragraph.
ENCUMBER, ENCUMBERING, OR ENCUMBRANCE - the creation of a security
interest, lien, pledge, mortgage or other encumbrance, whether such
encumbrance be voluntary, involuntary or by operation of Law; provided,
however, that the pledge or assignment to any creditor of the Company, or
any collateral agent for such creditor, of any Membership Interest as
security for the indebtedness to such creditor shall not be deemed to be
an Encumbrance thereof.
FAIR MARKET VALUE - Section 9.03.
GOVERNMENTAL AUTHORITY (OR GOVERNMENTAL) - a federal, state, local
or foreign governmental authority; a state, province, commonwealth,
territory or district thereof; a county or parish; a city, town,
township, village or other municipality; a district, xxxx or other
subdivision of any of the foregoing; any executive, legislative or other
governing body of any of the foregoing; any agency, authority, board,
department, system, service, office, commission, committee, council or
other administrative body of any of the foregoing; any court or
other judicial body and any officer, official or other representative of
any of the foregoing.
XXXXXXX - Xxxxxxx Power LLC, a Delaware limited liability company.
INCLUDING - including, without limitation.
INDEPENDENT MEMBER - means a Member of Eastern or Holding that is
a natural person who is not an officer, director, agent, employee or
representative of the Company, NRG, Eastern, Holding, any Owner Entity or
any Affiliate of any of the foregoing.
LAW - any applicable constitutional provision, statute, act, code
(including the Code), law, regulation, rule, ordinance, order, decree,
ruling, proclamation, resolution, judgment, decision, declaration, or
interpretative or advisory opinion or letter of a Governmental Authority
having valid jurisdiction.
LENDING MEMBER - Section 4.03(a)(ii).
LOAN DOCUMENTS- any and all documents relating to money borrowed
by the Company including money borrowed through public or private sales
of the Company's debt securities, as the same may be amended or restated
from time to time.
MANAGEMENT COMMITTEE - Section 6.02.
MEMBER - any Person executing this Agreement as of the date of
this Agreement as a member or hereafter admitted to the Company as a
member as provided in this Agreement, but such term does not include any
Person who has ceased to be a member in the Company.
MEMBERSHIP INTEREST - with respect to any Member, (a) that
Member's status as a Member; (b) that Member's share of the income, gain,
loss, deduction and credits of, and the right to receive distributions
from, the Company; (c) all other rights, benefits and privileges enjoyed
by that Member (under the Act, this Agreement, or otherwise) in its
capacity as a Member, including that Member's rights
4
5
to vote, consent and approve and otherwise to participate in the
management of the Company, including through the Management Committee;
and (d) all obligations, duties and liabilities imposed on that Member
(under the Act, this Agreement or otherwise) in its capacity as a Member,
including any obligations to make Capital Contributions.
MONTAUP - Montaup Electric Company, a Delaware corporation.
NIMO - Niagara Mohawk Power Corporation, a New York corporation.
NON-CONTRIBUTING MEMBER - Section 4.03(a).
NRG - NRG Energy, Inc., a Delaware corporation.
OFFICER - any Person designated as an officer of the Company as
provided in Section 6.02(j), but such term does not include any Person
who has ceased to be an officer of the Company.
OSWEGO - Oswego Harbor Power LLC, a Delaware limited liability
company.
OUTSIDE ACTIVITIES - Section 6.05(b).
OWNER ENTITIES - Xxxxxx Kill, Astoria, Dunkirk, Huntley, Somerset
and Oswego.
PARENT - if applicable to a Member, the company or companies set
forth opposite the name of such Member on Exhibit A.
PERSON - the meaning assigned that term in Section 18-101(l1) of
the Act and also includes a Governmental Authority and any other entity.
POWER MARKETING - NRG Northeast Power Marketing LLC, a Delaware
limited liability company.
PROJECTS - the electricity generating plants and facilities and
all related items of tangible and intangible property to be acquired by
the Owner Entities pursuant to the Asset Purchase Agreements.
REPRESENTATIVE - Section 6.02(a)(i).
RG&E - Rochester Gas and Electric Corporation, a New York
corporation.
SECURITIES ACT - the Securities Act of 1933.
SELLERS - each of NiMo, RG&E, ConEd and Montaup.
SHARING RATIO - subject in each case to adjustments in accordance
with this Agreement or in connection with Dispositions of Membership
Interests, (a) in the case of a Member executing this Agreement as of the
date of this Agreement or a Person acquiring such Member's Membership
Interest, the percentage specified for that Member as its Sharing Ratio
on Exhibit A, and (b) in the case of Membership Interest issued pursuant
to Section 3.04, the Sharing Ratio established pursuant thereto;
provided, however, that the total of all Sharing Ratios shall always
equal 100%.
SOLE DISCRETION - a Member's sole and absolute discretion, with or
without cause, and subject to whatever limitations or qualifications the
Member may impose.
TAX MATTERS MEMBER - Section 7.03(a).
TERM - Section 2.06.
5
6
TERMINATED MEMBER - Section 9.05.
TREASURY REGULATIONS - the regulations (including temporary
regulations) promulgated by the United States Department of the Treasury
pursuant to and in respect of provisions of the Code. All references
herein to sections of the Treasury Regulations shall include any
corresponding provision or provisions of succeeding, similar or
substitute, temporary or final Treasury Regulations.
UNIFORM COMMERCIAL CODE - the Uniform Commercial code as in effect
from time to time in the State of New York.
Other terms defined herein have the meanings so given them.
1.02 CONSTRUCTION. Unless the context requires otherwise: (a) the
gender (or lack of gender) of all words used in this Agreement includes the
masculine, feminine, and neuter; (b) references to Articles and Sections refer
to Articles and Sections of this Agreement; (c) references to Exhibits refer to
the Exhibits attached to this Agreement, each of which is made a part hereof for
all purposes; (d) references to Laws refer to such Laws as they may be amended
from time to time, and references to particular provisions of a Law include any
corresponding provisions of any succeeding Law; and (e) references to money
refer to legal currency of the United States of America.
ARTICLE 2
ORGANIZATION
2.01 FORMATION. The Company has been organized as a Delaware limited
liability company by the filing of a Certificate of Formation, dated as of the
Effective Date (the "Delaware Certificate"), with the Secretary of State of
Delaware pursuant to the Act.
2.02 NAME. The name of the Company is "NRG Northeast Generating LLC"
and all Company business must be conducted in that name or such other names that
comply with Law as the Management Committee may select.
2.03 REGISTERED OFFICE; REGISTERED AGENT; PRINCIPAL OFFICE IN THE
UNITED STATES; OTHER OFFICES. The registered office of the Company required by
the Act to be maintained in the State of Delaware shall be the office of the
initial registered agent named in the Delaware Certificate or such other office
(which need not be a place of business of the Company) as the Management
Committee may designate in the manner provided by Law. The registered agent of
the Company in the State of Delaware shall be the initial registered agent named
in the Delaware Certificate or such other Person or Persons as the Management
Committee may designate in the manner provided by Law. The principal office of
the Company in the United States shall be at such place as the Management
Committee may designate, which need not be in the State of Delaware, and the
Company shall maintain records there or such other place as the Management
Committee shall designate and shall keep the street address of such principal
office at the registered office of the Company in the State of Delaware. The
Company may have such other offices as the Management Committee may designate.
2.04 PURPOSES. The purposes of the Company are to acquire a 99% member
interest in each of the Owner Entities and Power Marketing; to cause the Owner
Entities to enter into, and perform their respective obligations under, the
Asset Purchase Agreements; and to engage in any activities directly relating
thereto, including obtaining financing for and contributing required capital to
the Owner Entities for the foregoing purposes.
2.05 FOREIGN QUALIFICATION. Prior to the Company's conducting business
in any jurisdiction other than Delaware, the Management Committee shall cause
the Company to comply, to the extent procedures are available and those matters
are reasonably within the control of the Management Committee, with all
requirements necessary to qualify the Company as a foreign limited liability
company in that jurisdiction. At the request of the Management Committee,
each Member shall execute, acknowledge, swear to, and deliver all certificates
and other instruments conforming with this Agreement that are necessary or
appropriate to qualify, continue, and terminate the Company as a foreign limited
liability company in all such jurisdictions in which the Company may conduct
business.
6
7
2.06 TERM. The period of existence of the Company (the "Term")
commenced on the Effective Date and shall end at such time as a certificate of
cancellation is filed with the Secretary of State of Delaware in accordance with
Section 11.04. Such period may be extended from time to time by Members holding
a majority of the Membership Interests.
2.07 NO STATE-LAW PARTNERSHIP. The Members intend that the Company not
be a partnership (including a limited partnership) or joint venture, and that
no Member be a partner or joint venturer of any other Member, for any purposes
other than federal and state tax purposes, and this Agreement may not be
construed to suggest otherwise.
2.08 UNITS; CERTIFICATES OF MEMBERSHIP INTEREST; APPLICABILITY OF
ARTICLE 8 OF UCC. Membership Interests shall be represented by units ("Units").
The number of authorized Units shall be one thousand (1,000). All Membership
Interests shall be represented by certificates in such form as the Management
Committee shall from time to time approve, shall be recorded in a register
thereof maintained by the Company, and shall be subject to such rules for the
issuance thereof as the Management Committee may from time to time determine.
Membership Interests shall be subject to the provisions of Article 8 of the
Uniform Commercial Code as may be applicable from time to time.
ARTICLE 3
MEMBERSHIP; DISPOSITIONS OF INTERESTS
3.01 INITIAL MEMBERS. The initial Members of the Company are the
Persons executing this Agreement as of the date of this Agreement as Members,
each of which is admitted to the Company as a Member effective
contemporaneously with the execution by such Person of this Agreement.
3.02 REPRESENTATIONS, WARRANTIES AND COVENANTS. Each Member hereby
represents, warrants and covenants to the Company and each other Member that the
following statements are true and correct as of the Effective Date and shall be
true and correct at all times that such Member is a Member:
(a) that Member is duly incorporated, organized or formed (as
applicable), validly existing, and (if applicable) in good standing under
the Law of the jurisdiction of its incorporation, organization or
formation; if required by applicable Law, that Member is duly qualified
and in good standing in the jurisdiction of its principal place of
business, if different from its jurisdiction of incorporation,
organization or formation; and that Member has full power and authority
to execute and deliver this Agreement and to perform its obligations
hereunder, and all necessary actions by the board of directors,
shareholders, managers, members, partners, trustees, beneficiaries, or
other applicable Persons necessary for the due authorization, execution,
delivery, and performance of this Agreement by that Member have been duly
taken;
(b) that Member has duly executed and delivered this Agreement
and the other documents contemplated herein, and they constitute the
legal, valid and binding obligation of that Member enforceable against it
in accordance with their terms (except as may be limited by bankruptcy,
insolvency or similar Laws of general application and by the effect of
general principles of equity, regardless of whether considered at law or
in equity); and
(c) that Member's authorization. execution, delivery, and
performance of this Agreement does not and will not (i) conflict with, or
result in a breach, default or violation of, (A) the organizational
documents of such Member, (B) any contract or agreement to which that
Member is a party or is otherwise subject, or (C) any Law, order,
judgment, decree, writ, injunction or arbitral award to which that Member
is subject; or (ii) require any consent, approval or authorization from,
filing or registration with, or notice to, any Governmental Authority or
other Person, unless such requirement has already been satisfied.
3.03 DISPOSITIONS AND ENCUMBRANCES OF MEMBERSHIP INTERESTS.
7
8
(a) GENERAL RESTRICTION. A Member may not Dispose of or
Encumber all or any portion of its Membership Interest except in strict
accordance with this Section 3.03. (References in this Section 3.03 to
Dispositions or Encumbrances of a "Membership Interest" shall also refer
to Dispositions or Encumbrances of a portion of a Membership Interest.)
Any attempted Disposition or Encumbrance of a Membership Interest, other
than in strict accordance with this Section 3.03, shall be, and is hereby
declared, null and void ab initio. The Members agree that a breach of the
provisions of this Section 3.03 may cause irreparable injury to the
Company and to the other Members for which monetary damages (or other
remedy at law) are inadequate in view of (i) the complexities and
uncertainties in measuring the actual damages that would be sustained by
reason of the failure of a Member to comply with such provision and (ii)
the uniqueness of the Company business and the relationship among the
Members. Accordingly, the Members agree that the provisions of this
Section 3.03 may be enforced by specific performance.
(b) DISPOSITIONS OF MEMBERSHIP INTERESTS.
(i) GENERAL RESTRICTION. A Member may not Dispose of all
or any portion of its Membership Interest except by complying with
all of the following requirements:
(A) such Member must receive the unanimous
consent of the non-Disposing Members, which consent shall
not be unreasonably withheld by each of such other Members;
provided, however, that such consent need not be obtained
if (I) the proposed Assignee is a Affiliate of the
Disposing Member and (II) such proposed Assignee
demonstrates to the reasonable satisfaction of the other
Members that it has the ability to meet the financial and
contractual commitments and other obligations of the
Disposing Member; and
(B) such Member must comply with the requirements
of Section 3.03(b)(iii) and, if the Assignee is to be
admitted as a Member, Section 3.03(b)(ii).
(ii) ADMISSION OF ASSIGNEE AS A MEMBER. An Assignee has
the right to be admitted to the Company as a Member, with the
Membership Interest (and attendant Sharing Ratio) so transferred
to such Assignee, only if (A) the Disposing Member making the
Disposition has granted the Assignee either (I) the Disposing
Member's entire Membership Interest or (II) the express right to
be so admitted; and (B) such Disposition is effected in strict
compliance with this Section 3.03.
(iii) REQUIREMENTS APPLICABLE TO ALL DISPOSITIONS AND
ADMISSIONS. In addition to the requirements set forth in Sections
3.03(b)(i) and 3.03(b)(ii), any Disposition of a Membership
Interest and any admission of an Assignee as a Member shall also
be subject to the following requirements, and such Disposition
(and admission, if applicable) shall not be effective unless such
requirements are complied with; provided, however, that the
Management Committee, in its sole and absolute discretion, may
waive any of the following requirements:
(A) DISPOSITION DOCUMENTS. The following
documents must be delivered to the Management Committee and
must be satisfactory, in form and substance, to the
Management Committee:
(I) DISPOSITION INSTRUMENT. A copy of the
instrument pursuant to which the Disposition is
effected.
(II) RATIFICATION OF THIS AGREEMENT. An
instrument, executed by the Disposing Member and its
Assignee, containing the following information and
agreements, to the extent they are not contained in
the instrument described in Section
3.03(b)(iii)(A)(I): (1) the notice address of the
Assignee; (2) if applicable, the Parent of the
Assignee; (3) the Sharing Ratios after the
Disposition of the Disposing Member and its Assignee
(which together must
8
9
total the Sharing Ratio of the Disposing Member
before the Disposition); (4) the Assignee's
ratification of this Agreement and agreement to be
bound by it, and its confirmation that the
representations and warranties in Section 3.02 are
true and correct with respect to it; (5) the
Assignee's ratification of all of the Project
Agreements and agreement by be bound by them, to the
same extent that the Disposing Member was bound by
them prior to the Disposition; and (6)
representations and warranties by the Disposing
Member and its Assignee (aa) that the Disposition
and admission is being made in accordance with all
applicable Laws, and (bb) that the matters set forth
in Sections 3.03(b)(iii)(A)(III) and (IV) are true
and correct.
(III) Securities Law Opinion. Unless the Membership
Interest subject to the Disposition is registered
under the Securities Act and any applicable state
securities Law, or the proposed Assignee is a
Affiliate as described in 3.03(b)(i)(A) above, a
favorable opinion of the Company's legal counsel, or
of other legal counsel acceptable to the Management
Committee, to the effect that the Disposition and
admission is being made pursuant to a valid
exemption from registration under those Laws and in
accordance with those Laws.
(IV) Tax Opinion. A favorable opinion of the
Certified Public Accountants, or of other certified
public accountants acceptable to the Management
Committee, to the effect that the Disposition would
not result in the Company's being considered to have
terminated within the meaning of Code Section 708.
(B) Payment of Expenses. The Disposing Member and
its Assignee shall pay, or reimburse the Company for, all
reasonable costs and expenses incurred by the Company in
connection with the Disposition and admission, including
the legal fees incurred in connection with the legal
opinions referred to in Sections 3.03(b)(iii)(A)(III) and
(IV), on or before the tenth Day after the receipt by that
Person of the Company's invoice for the amount due.
(C) No Release. No Disposition of a Membership
Interest shall effect a release of the Disposing Member
from any liabilities to the Company or the other Members
arising from events occurring prior to the Disposition,
(iv) Change of Member Control. A Change of Member Control
must also comply with the requirements of this Section 3.03.
(c) Encumbrances of Membership Interest. A Member may Encumber
its Membership Interest if (i) the instrument creating such Encumbrance
provides that any foreclosure of such Encumbrance (or Disposition in lieu
of such foreclosure) must comply with the requirements of Section
3.03(b), and (ii) any such Encumbrance is not prohibited by the Loan
Documents.
(d) Right of First Refusal. Except as otherwise expressly
permitted by this Agreement, this Section 3.03(d) shall apply to any
proposed voluntary Disposition of a Membership Interest to any purchaser
(other than a majority owned Affiliate of the disposing party) for
consideration in the form of cash or promissory notes or other
obligations to pay sums certain. The Member proposing to make such a
Distribution shall provide written notice (a "Disposition Notice") to the
remaining Members at least 90 days prior to the proposed Disposition. The
Disposition Notice must set forth the identity of the proposed
transferee, the sale price, and all other material terms and conditions
of the proposed Disposition. In the Case of a Change of member Control,
the Disposition notice must set forth the portion, if less than 100%, of
the total purchase price that is applicable to such Member's Membership
Interest. Upon receipt of a Disposition Notice, the remaining Members
shall have the option for a period of 30 days to purchase all, but not
less than all, of such Membership Interest. Such Membership Interest
shall be allocated to the Members exercising their option under this
Section 3.03(d) pro rata in accordance with their Membership
9
10
Interests. The purchase pursuant to the exercise of this option shall be
at the price and pursuant to the terms and conditions of the Proposed
Disposition. If no Member exercises such option, the Member proposing
such Disposition shall be free, for a period of 60 days after the
expiration of the remaining Members' options, to Dispose of the
Membership Interests that were the subject of the Disposition Notice, but
only to the party, and for the price and on the terms and conditions, set
forth in the Disposition Notice. If the proposed disposition does not
occur within 60 days after the expiration of the remaining Members'
options, the Membership Interest may not be Disposed of pursuant to this
section 30.0(d) unless the Member again complies with the terms of this
Agreement.
(e) Rights In Membership Interests Pledged as Collateral. Any
other provision of this Agreement to the contrary notwithstanding, by
executing and delivering this Agreement, each Member shall be deemed to
have consented to (i) the pledge, assignment, hypothecation and transfer
to any creditor of the Company or any Owner Entity or its agents,
successors or assigns of, and the grant to such creditor or other Person
of a lien on and security interest in, as security for the indebtedness
of the Company or such Owner Entity to such creditor, all of such
Member's right, title and interest in, to and under its Membership
Interest and any other collateral securing such indebtedness, (ii) the
exercise by any such creditor or other Person of the rights and remedies
under any security document related to such collateral, including,
without limitation, the right to exercise the voting and consensual
rights and other powers of each Member to the extent provided in any such
security document, and (ii) the right to foreclose upon or exercise a
power of sale with respect to the Membership Interest of each Member and
any other collateral subject to such security documents and to cause the
agent or designee of such creditor or any third party purchaser of such
Membership Interest to become an additional or substitute Member, and (c)
all other provisions of the loan and security documents relating to such
indebtedness or collateral, the issuance of new or substituted
Membership Interests, or the ownership of Membership Interests.
3.04 Creation of Additional Membership Interest. Provided that the same
is not prohibited by the Loan Documents, additional Membership Interests may be
created and issued to existing Members or to other Persons, and such other
Persons may be admitted to the Company as Members, with the unanimous consent of
the existing Members, on such terms and conditions as the existing Members may
unanimously determine at the time of admission. The terms of admission or
issuance must specify the Sharing Ratios applicable thereto and may provide for
the creation of different classes or groups of Members having different rights,
powers, and duties. The Management Committee may reflect the creation of any new
class or group in an amendment to this Agreement indicating the different
rights, powers, and duties. Any such admission is effective only after the new
Member has executed and delivered to the Members an instrument containing the
notice address of the new Member, the Assignee's ratification of this Agreement
and agreement to be bound by it, and its confirmation that the representations
and warranties in Section 3.02 are true and correct with respect to it. The
provisions of this Section 3.04 shall not apply to Dispositions of Membership
Interests or admissions of Assignees in connection therewith, such matters being
governed by Section 3.03.
3.05 Access to Information. Each Member shall be entitled to receive
any information that it may request concerning the Company; provided, however,
that this Section 3.05 shall not obligate the Company or the Management
Committee to create any information that does not already exist at the time of
such request (other than to convert existing information from one medium to
another, such as providing a printout of information that is stored in a
computer database). Each Member shall also have the right, upon reasonable
notice, and at all reasonable times during usual business hours to inspect the
properties of the Company and to audit, examine and make copies of the books of
account and other records of the Company. Such right may be exercised through
any agent or employee of such Member designated in writing by it or by an
independent public accountant, engineer, attorney or other consultant so
designated. The Member making the request shall bear ail costs and expenses
incurred in any inspection, examination or audit made on such Member's behalf.
Confidential Information obtained pursuant to this Section 3.05 shall be subject
to the provisions of Section 3.06.
3.06 Confidential Information.
(a) Except as permitted by Section 3.06(b), (i) each Member shall
keep confidential all Confidential Information and shall not disclose any
Confidential Information to any Person, including any
10
11
of its Affiliates, and (ii) each Member shall use the Confidential
Information only in connection with the Company.
(b) Notwithstanding Section 3.06(a), but subject to the other
provisions of this Section 3.06, a Member may make the following
disclosures and uses of Confidential Information.
(i) disclosures to another Member in connection with the
Company;
(ii) disclosures and uses that are approved by the
Management Committee;
(iii) disclosures to an Affiliate of such Member on a
"need to know" basis in connection with the Company, if such
Affiliate has agreed to abide by the terms of this Section 3.06;
(iv) disclosures to a Person that is not a Member or an
Affiliate of a Member, if such Person has been retained to provide
services by the Member in connection with the Company or such
Member's Membership Interest and has agreed to abide by the terms
of this Section 3.06;
(v) disclosures to lenders, potential lenders or other
Persons providing financing to the Company and potential
purchasers of equity interests in the Company, if such Persons
have agreed to abide by the terms of this Section 3.06;
(vi) disclosures to any independent system operator or
its consultants and representatives in connection with the
Acquisitions or the conduct of the businesses of the Owner
Entities;
(vii) disclosures to Governmental Authorities that are
necessary to operate the Projects;
(viii) disclosures that a Member is legally compelled to
make by deposition, interrogatory, request for documents,
subpoena, civil investigative demand, order of a court of
competent jurisdiction, or similar process, or otherwise by Law
or securities exchange requirements; provided, however, that,
prior to any such disclosure, such Member shall, to the extent
legally permissible:
(A) provide the Management Committee with prompt
notice of such requirements so that one or more of the
Members may seek a protective order or other appropriate
remedy or waive compliance with the terms of this Section
3.06(b)(vii);
(B) consult with the Management Committee on the
advisability of taking steps to resist or narrow such
disclosure; and
(C) cooperate with the Management Committee and
with the other Members in any attempt one or more of them
may make to obtain a protective order or other appropriate
remedy or assurance that confidential treatment will be
afforded the Confidential Information; and in the event
such protective order or other remedy is not obtained, or
the other Members waive compliance with the provisions
hereof, such Member agrees (I) to furnish only that portion
of the Confidential Information that the other Members are
advised by counsel to the disclosing Member is legally
required and (II) to exercise all reasonable efforts to
obtain assurance that confidential treatment will be
accorded such Confidential Information.
(c) Each Member shall take such precautionary measures as may
be required to ensure (and such Member shall be responsible for)
compliance with this Section 3.06 by any of its Affiliates, and its and
their directors, officers, employees and agents, and other Persons to
which it may disclose Confidential Information in accordance with this
Section 3.06.
11
12
(d) A Terminated Member shall promptly destroy (and provide a
certificate of destruction to the Company with respect to) or return to
the Company, as directed by the Management Committee, all Confidential
Information in its possession. Notwithstanding the immediately-preceding
sentence, a Terminated Member may, subject to the other provisions of
this Section 3.06, retain and use Confidential Information for the
limited purpose of preparing such Terminated Member's tax returns and
defending audits, investigations and proceedings relating thereto.
(e) The Members agree that no adequate remedy at law exists for
a breach or threatened breach of any of the provisions of this Section
3.06, the continuation of which unremedied will cause the Company and the
other Members to suffer irreparable harm. Accordingly, the Members agree
that the Company and the other Members shall be entitled, in addition to
other remedies that may be available to them, to immediate injunctive
relief from any breach of any of the provisions of this Section 3.06 and
to specific performance of their rights hereunder, as well as to any
other remedies available at law or in equity.
(f) The obligations of the Members under this Section 3.06
shall terminate on the third anniversary of the end of the Term.
3.07 LIABILITY TO THIRD PARTIES. No Member shall be liable for the
debts, obligations or liabilities of the Company.
3.08 WITHDRAWAL. A Member may not withdraw or resign from the Company
except as permitted by this Agreement.
ARTICLE 4
CAPITAL CONTRIBUTIONS
4.01 INITIAL CAPITAL CONTRIBUTIONS. Contemporaneously with the
execution by such Member of this Agreement, each Member shall make the Capital
Contributions described for that Member in Exhibit A.
4.02 SUBSEQUENT CAPITAL CONTRIBUTIONS. Without creating any rights in
favor of any third party, each Member shall contribute to the Company, in cash,
on or before the date specified as hereinafter described, that Member's Sharing
Ratio of all monies that in the unanimous judgment of the Management Committee
are necessary to enable the Company to acquire the Projects and to cause the
assets of the Operating Entities to be properly operated and maintained and to
pay and perform their respective costs, expenses, obligations and liabilities.
The Management Committee shall notify each Member of the need for Capital
Contributions pursuant to this Section 4.02 when appropriate, which notice must
include a statement in reasonable detail of the proposed uses of the Capital
Contributions and a date (which date may be no earlier than the fifth Business
Day following each Member's receipt of its notice) before which the Capital
Contributions must be made. Notices for Capital Contributions must be made to
all Members in accordance with their Sharing Ratios.
4.03 FAILURE TO CONTRIBUTE.
(a) If a Member does not contribute, within 10 Days of the date
required, all or any portion of a Capital Contribution that Member is
required to make as provided in this Agreement, the other Members may
cause the Company to exercise, on notice to that Member (the "Non-
Contributing Member"), one or more of the following remedies:
(i) taking such action (including court proceedings) as
the other Members may deem appropriate to obtain payment by the
Non-Contributing Member of the portion of the Non-Contributing
Member's Capital Contribution that is in default, together with
interest thereon at the Default Rate from the date that the
Capital Contribution was due until the date that it is made, all
at the cost and expense of the Non-Contributing Member;
12
13
(ii) permitting the other Members in proportion to their
Sharing Ratios or in such other percentages as they may agree (the
"Lending Member," whether one or more), to advance the portion of
the Non-Contributing Member's Capital Contribution that is in
default, with the following results:
(A) the sum advanced constitutes a loan from the
Lending Member to the Non-Contributing Member and a Capital
Contribution of that sum to the Company by the
Non-Contributing Member pursuant to the applicable
provisions of this Agreement,
(B) the principal balance of the loan and all
accrued unpaid interest thereon is due and payable in whole
on the tenth Day after written demand therefor by the
Lending Member to the Non-Contributing Member,
(C) the amount lent bears interest at the Default
Rate from the Day that the advance is deemed made until the
date that the loan, together with all interest accrued on
it, is repaid to the Lending Member,
(D) all distributions from the Company that
otherwise would be made to the Non-Contributing Member
(whether before or after dissolution of the Company)
instead shall be paid to the Lending Member until the loan
and all interest accrued on it have been paid in full to
the Lending Member (with payments being applied first to
accrued and unpaid interest and then to principal),
(E) the payment of the loan and interest accrued
on it is secured by a security interest in the
Non-Contributing Member's Membership Interest, as more
fully set forth in Section 4.03(b), and
(F) the Lending Member has the right, in addition
to the other rights and remedies granted to it pursuant to
this Agreement or available to it at Law or in equity, to
take any action (including court proceedings) that the
Lending Member may deem appropriate to obtain payment by
the Non-Contributing Member of the loan and all accrued and
unpaid interest on it, at the cost and expense of the
Non-Contributing Member;
(iii) exercising the rights of a secured party under the
Uniform Commercial Code of the State of Delaware, as more fully
set forth in Section 4.03(b); or
(iv) exercising any other rights and remedies available
at Law or in equity.
In addition, the failure to make such contributions shall constitute a Default
by the Non-Contributing Member, and the other Members shall have the rights set
forth in Article 9 with respect to such Default.
(b) Subject and subordinate to the rights of any creditor of
the Company under the Loan Documents, each Member grants to the Company,
and to each Lending Member with respect to any loans made by the Lending
Member to that Member as a Non-Contributing Member pursuant to Section
4.03(a)(ii), as security, equally and ratably, for the payment of all
Capital Contributions that Member has agreed to make and the payment of
all loans and interest accrued on them made by Lending Members to that
Member as a Non-Contributing Member pursuant to Section 4.03(a)(ii), a
security interest in and a general lien on its Membership Rights and the
proceeds thereof, all under the Uniform Commercial Code. On any default
in the payment of a Capital Contribution or in the payment of such a loan
or interest accrued on it, the Company or the Lending Member, as
applicable, is entitled to all the rights and remedies of a secured party
under the Uniform Commercial Code of the State of Delaware with respect
to the security interest granted in this Section 4.03(b). Each Member
shall execute and deliver to the Company and the other Members all
financing statements and other instruments that the Lending Member may
request to effectuate and carry out the preceding provisions of this
Section 4.03(b). At the
13
14
option of a Lending Member, this Agreement or a carbon, photographic, or
other copy hereof may serve as a financing statement.
4.04 LOANS. If the Company does not have sufficient cash to pay its
obligations, any Member(s) that may agree to do so with the consent of the
Management Committee may advance all or part of the needed funds to or on behalf
of the Company. An advance described in this Section 4.04 constitutes a loan
from the Member to the Company, bears interest at a rate determined by the
Management Committee from the date of the advance until the date of payment,
and is not a Capital Contribution.
4.05 RETURN OF CONTRIBUTIONS. Except as expressly provided herein, a
Member is not entitled to the return of any part of its Capital Contributions or
to be paid interest in respect of either its Capital Account or its Capital
Contributions. An unrepaid Capital Contribution is not a liability of the
Company or of any Member. A Member is not required to contribute or to lend any
cash or property to the Company to enable the Company to return any Member's
Capital Contributions.
4.06 CAPITAL ACCOUNTS. A Capital Account shall be established and
maintained for each Member. Each Member's Capital Account shall be increased by
(a) the amount of money contributed by that Member to the Company, (b) the fair
market value of property contributed by that Member to the Company (net of
liabilities secured by such contributed property that the Company is considered
to assume or take subject to under Section 752 of the Code), and (c) allocations
to that Member of Company income and gain (or items thereof), including income
and gain exempt from tax and income and gain described in Treasury Regulation
Section 1.704-1(b)(2)(iv)(g), but excluding income and gain described in
Treasury Regulation Section 1.704-1(b)(4)(i), and shall be decreased by (d) the
amount of money distributed to that Member by the Company, (e) the fair market
value of property distributed to that Member by the Company (net of liabilities
secured by such distributed property that such Member is considered to assume or
take subject to under Section 752 of the Code), (f) allocations to that Member
of expenditures of the Company described (or treated as described) in Section
705(a)(2)(B) of the Code, and (g) allocations of Company loss and deduction (or
items thereof), including loss and deduction described in Treasury Regulation
Section 1.704-1(b)(2)(iv)(g), but excluding items described in (f) above and
loss or deduction described in Treasury Regulation Section 1.704-1(b)(4)(i) or
1.704-1(b)(4)(iii). The Members' Capital Accounts shall also be maintained and
adjusted as permitted by the provisions of Treasury Regulation Section 1.704-1
(b)(2)(iv)(f) and as required by the other provisions of Treasury Regulation
Sections 1.704-1(b)(2)(iv) and 1.704-1(b)(4), including adjustments to reflect
the allocations to the Members of depreciation, depletion, amortization, and
gain or loss as computed for book purposes rather than the allocation of the
corresponding items as computed for tax purposes, as required by Treasury
Regulation Section 1.704-1(b)(2)(iv)(g). Thus, the Members' Capital Accounts
shall be increased or decreased to reflect a revaluation of the Company's
property on its books based on the fair market value of the Company's property
on the date of adjustment immediately prior to (A) the contribution of money or
other property to the Company by a new or existing Member as consideration for a
Membership Interest or an increased Sharing Ratio, (B) the distribution of money
or other property by the Company to a Member as consideration for a Membership
Interest, or (C) the liquidation of the Company. A Member that has more than one
Membership Interest shall have a single Capital Account that reflects all such
Membership Interests, regardless of the class of Membership Interests owned by
such Member and regardless of the time or manner in which such Membership
Interests were acquired. Upon the Disposition of all or a portion of a
Membership Interest, the Capital Account of the Disposing Member that is
attributable to such Membership Interest shall carry over to the Assignee in
accordance with the provisions of Treasury Regulation Section
1.704-1(b)(2)(iv)(l).
14
15
ARTICLE 5
DISTRIBUTIONS AND ALLOCATIONS
5.01 DISTRIBUTIONS OR XXXXXXXX. Except as provided in the Loan
Documents, distributions to the Members shall be made only to all simultaneously
in proportion to their respective Sharing Ratios (at the time the amounts of
such distributions are determined), and distributions shall be made only in such
aggregate amounts and at such times as shall be determined by the Management
Committee and as are permitted by the Loan Documents. When so permitted, the
Management Committee shall endeavor to distribute to the Members, on or before
the last day of each calendar month, or more often if approved by the Management
Committee, the estimated amount of any cash available for such calendar month
(net of any adjustments, if any, made to reflect the actual cash available for
the preceding calendar month). Any cash in excess of the Working Capital
Requirements shall be distributed to the Members.
5.02 DISTRIBUTIONS ON DISSOLUTION AND WINDING UP. Upon the dissolution
and winding up of the Company, after adjusting the Capital Accounts for all
distributions made under Section 5.01 and all allocations under Article 5, all
available proceeds distributable to the Members as determined under Section
11.02 shall be distributed to all of the Members to the extent of the Members'
positive Capital Account balances.
5.03 ALLOCATIONS.
(a) For purposes of maintaining the Capital Accounts pursuant
to Section 4.06 and for income tax purposes, except as provided in
Section 5.03(b), each item of income, gain, loss, deduction and credit of
the Company shall be allocated to the Members in accordance with their
Sharing Ratios.
(b) For income tax purposes, income, gain, loss, and deduction
with respect to property contributed to the Company by a Member or
revalued pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(f)
shall be allocated among the Members in a manner that takes into account
the variation between the adjusted tax basis of such property and its
book value, as required by Section 704(c) of the Code and Treasury
Regulation Section 1.704-1(b)(4)(i), using the remedial allocation
method permitted by Treasury Regulation Section 1.704-3(d).
5.04 VARYING INTERESTS. All items of income, gain, loss, deduction or
credit shall be allocated, and all distributions shall be made, to the Persons
shown on the records of the Company to have been Members as of the last calendar
day of the period for which the allocation or distribution is to be made.
Notwithstanding the foregoing, if during any taxable year there is a change in
any Member's Sharing Ratio, the Members agree that their allocable shares of
such items for the taxable year shall be determined on any method determined by
the Management Committee to be permissible under Code Section 706 and the
related Treasury Regulations to take account of the Members' varying Sharing
Ratios.
ARTICLE 6
MANAGEMENT
6.01 MANAGEMENT BY MEMBERS. Except as described below in Sections 6.03
and 6.05, the management of the Company is fully vested in the Members, acting
exclusively in their membership capacities. To facilitate the orderly and
efficient management of the Company, the Members shall act (a) collectively as a
"committee of the whole" pursuant to Section 6.02 or (b) through the delegation
from time to time of certain responsibility and authority to particular Members
pursuant to Section 6.04. No Member has the right, power or authority to act for
or on behalf of the Company, to do any act that would be binding on the Company,
or to incur any expenditures on behalf of the Company, except in accordance with
the immediately preceding sentence. Decisions or actions taken in accordance
with the provisions of this Agreement shall constitute decisions or actions by
the Company and shall be binding on each Member, Representative, Officer and
employee of the Company.
6.02 MANAGEMENT COMMITTEE. The Members shall act collectively through
meetings as a "committee of the whole," which is hereby named the "Management
Committee." The Management Committee shall conduct its affairs in accordance
with the following provisions and the other provisions of this Agreement:
15
16
(a) REPRESENTATIVES.
(i) DESIGNATION. To facilitate the orderly and efficient
conduct of Management Committee meetings, each Member shall
notify the other Members, from time to time, of the identity of
two of its officers, employees or agents who will represent it at
such meetings (each a "Representative"). In addition, each Member
may (but shall have no obligation to) notify the other Members,
from time to time, of the identity of other officers, employees or
agents who will represent it at any meeting that the Member's
Representatives are unable to attend (each an "Alternate
Representative"). (The term "Representative" shall also refer to
any Alternate Representative that is actually performing the
duties of the applicable Representative.). The initial
Representatives of each Member are set forth on Exhibit A. A
Member may designate different Representatives or Alternate
Representatives for any meeting of the Management Committee by
notifying each of the other Members at least three Business Days
prior to the scheduled date for such meeting; provided, however,
that if giving such advance notice is not feasible, then such new
Representatives or Alternate Representatives shall present written
evidence of their authority at the commencement of such meeting.
(ii) AUTHORITY. Each Representative shall have the full
authority to act on behalf of the Member that designated such
Representative; the action of a Representative at a meeting (or
through a written consent) of the Management Committee shall
bind the Member that designated such Representative; and the other
Members shall be entitled to rely upon such action without further
inquiry or investigation as to the actual authority (or lack
thereof) of such Representative. In addition, the act of an
Alternate Representative shall be deemed the act of the
Representative for which such Alternate Representative is acting,
without the need to produce evidence of the absence or
unavailability of such Representative.
(iii) DISCLAIMER OF DUTIES; INDEMNIFICATION. EACH
REPRESENTATIVE SHALL REPRESENT, AND OWE DUTIES TO, ONLY THE MEMBER
THAT DESIGNATED SUCH REPRESENTATIVE (THE NATURE AND EXTENT OF SUCH
DUTIES BEING AN INTERNAL CORPORATE AFFAIR OF SUCH MEMBER), AND NOT
TO THE COMPANY, ANY OTHER MEMBER OR REPRESENTATIVE, OR ANY OFFICER
OR EMPLOYEE OF THE COMPANY. THE PROVISIONS OF SECTION 6.05 SHALL
ALSO INURE TO THE BENEFIT OF EACH MEMBER'S REPRESENTATIVES. THE
COMPANY SHALL INDEMNIFY, PROTECT, DEFEND, RELEASE AND HOLD
HARMLESS EACH REPRESENTATIVE FROM AND AGAINST ANY CLAIMS ASSERTED
BY OR ON BEHALF OF ANY PERSON (INCLUDING ANOTHER MEMBER), OTHER
THAN THE MEMBER THAT DESIGNATED SUCH REPRESENTATIVE, THAT ARISE
OUT OF, RELATE TO OR ARE OTHERWISE ATTRIBUTABLE TO, DIRECTLY OR
INDIRECTLY, SUCH REPRESENTATIVE'S SERVICE ON THE MANAGEMENT
COMMITTEE, OTHER THAN SUCH CLAIMS ARISING OUT OF THE FRAUD OR
WILLFUL MISCONDUCT OF SUCH REPRESENTATIVE.
(iv) ATTENDANCE. Each Member shall use all reasonable
efforts to cause its Representatives or Alternate Representatives
to attend each meeting of the Management Committee, unless its
Representatives are unable to do so because of a "force majeure"
event or other event beyond his reasonable control, in which event
such Member shall use all reasonable efforts to cause its
Representatives or Alternate Representatives to participate in the
meeting by telephone pursuant to Section 6.02(h).
(b) CHAIRMAN AND SECRETARY. One of the Representatives will be
designated as Chairman of the Management Committee, in accordance with
this Section 6.02(b), to preside over meetings of the Management
Committee. The Management Committee shall also designate a Secretary
of the Management Committee, who need not be a Representative.
(c) PROCEDURES. The Secretary of the Management Committee shall
maintain written minutes of each of its meetings, which shall be
submitted for approval no later than the next regularly-
16
17
scheduled meeting. The Management Committee may adopt whatever rules and
procedures relating to its activities as it may deem appropriate,
provided that such rules and procedures shall not be inconsistent with or
violate the provisions of this Agreement.
(d) TIME AND PLACE OF MEETINGS. The Management Committee
shall meet quarterly, subject to more or less frequent meetings upon
approval of the Management Committee. Notice of, and an agenda for,
all Management Committee meetings shall be provided by the Chairman to
all Members at least ten Days prior to the date of each meeting, together
with proposed minutes of the previous Management Committee meeting (if
such minutes have not been previously ratified). Special meetings of the
Management Committee may be called at such times, and in such manner, as
any Member deems necessary. Any Member calling for any such special
meeting shall notify the Chairman, who in turn shall notify all Members
of the date and agenda for such meeting at least ten Days prior to the
date of such meeting. Such ten-day period may be shortened by the
Management Committee. All meetings of the Management Committee shall be
held at a location designated by the Chairman. Attendance of a Member at
a meeting of the Management Committee shall constitute a waiver of
notice of such meeting, except where such Member attends the meeting for
the express purpose of objecting to the transaction of any business on
the ground that the meeting is not lawfully called or convened.
(e) QUORUM. The presence of one Representative designated by
each Member shall constitute a quorum for the transaction of business at
any meeting of the Management Committee.
(f) VOTING. Except as provided otherwise in this Agreement, (i)
voting at any meeting of the Management Committee shall be according to
the Members' respective Sharing Ratios, and (ii) the affirmative vote of
Members holding a majority of the Sharing Ratios shall constitute the act
of the Management Committee.
(g) ACTION BY WRITTEN CONSENT. Any action required or
permitted to be taken at a meeting of the Management Committee may be
taken without a meeting, without prior notice, and without a vote if a
consent or consents in writing, setting forth the action so taken, is
signed by Members that could have taken the action at a meeting of the
Management Committee at which all Members entitled to vote on the action
were represented and voted.
(h) MEETINGS BY TELEPHONE. Members may participate in and hold
such meeting by means of conference telephone, video conference or
similar communications equipment by means of which all persons
participating in the meeting can hear each other. Participation in such a
meeting shall constitute presence in person at such meeting, except where
a Member participates in the meeting for the express purpose of objecting
to the transaction of any business on the ground that the meeting is not
lawfully called or convened.
(i) SUBCOMMITTEES. The Management Committee may create such
subcommittees, delegate to such subcommittees such authority and
responsibility, and rescind any such delegations, as it may deem
appropriate.
(j) OFFICERS. The Management Committee may designate one or
more Persons to be Officers of the Company. Any Officers so designated
shall have such titles and, subject to the other provisions of this
Agreement, have such authority and perform such duties as the Management
Committee may specifically delegate to them and shall serve at the
pleasure of the Management Committee.
6.03 DELEGATION TO PARTICULAR MEMBER. The Management Committee may
delegate to one or more Members such authority and duties as the Management
Committee may deem advisable. Decisions or actions taken by any such Member in
accordance with the provisions of this Agreement shall constitute decisions or
actions by the Company and shall be binding on each Member, Representative,
Officer and employee of the Company. Any delegation pursuant to this Section
6.03 may be revoked at any time by the Management Committee. With respect to
duties discharged hereunder by a Member (a) such Member may discharge such
duties through the personnel of a Affiliate of such Member, and (b) unless the
Members otherwise agree, the Company shall compensate such Member (or its
Affiliate, as applicable) for the performance of such duties in an amount equal
to the manhours
17
18
expended by the personnel of such Member (or its Affiliate) multiplied by the
applicable rate(s) shown on Exhibit B (which rates each shall escalate on the
first day of each calendar year during the term hereof by an amount which is 5%
of the rate applicable during the prior calendar year), and shall reimburse
such Member for all out of pocket costs incurred by such Member in discharging
such duties. In addition, prior to performing any such duties, the performing
Member shall provide to the other Member for approval an estimate of man-hours
and types of Personnel required to perform the delegated duties and a schedule
for the performance of the delegated duties and for other costs associated
therewith, and shall promptly inform the other Member of any variance from the
budget or schedule.
6.04 AFFILIATE AGREEMENTS; CONFLICTS OF INTEREST. Subject to any other
agreement between the Members (and their respective Affiliates, as applicable),
a Member or an Affiliate of a Member may engage in and possess interests in
other business ventures of any and every type and description, independently or
with others, including ones in competition with the Company, with no obligation
to offer to the Company, any other Member or any Affiliate of another Member the
right to participate therein. Subject to, and in addition to, Section 6.03(a),
the Company may transact business with any Member or Affiliate thereof, provided
the terms of those transactions are approved by the Management Committee or
expressly contemplated by this Agreement. Without limiting the generality of the
foregoing, the Members recognize and agree that they and their respective
Affiliates currently engage in certain activities involving the generation,
transmission, distribution, marketing and trading of electricity and other
energy products (including futures, options, swaps, exchanges of future
positions for physical deliveries and commodity trading), and the gathering,
processing, storage and transportation of such products, as well as other
commercial activities related to such products, and that these and other
activities by Members and their Affiliates may be made possible or more
profitable by reason of the Company's activities (herein referred to as "Outside
Activities"). The Members agree that (i) no Member or Affiliate of a Member
shall be restricted in its right to conduct, individually or jointly with
others, for its own account any Outside Activities, and (ii) no Member or its
Affiliates shall have any duty or obligation, express or implied, to account to,
or to share the results or profits of such Outside Activities with, the Company,
any other Member or any Affiliate of any other Member, by reason of such Outside
Activities.
6.05 UNANIMOUS CONSENT REQUIRED FOR CERTAIN ACTION. Any other provision
of this Agreement to the contrary notwithstanding, the unanimous consent of the
Members, and at least one Independent Member, shall be required to:
(a) File a bankruptcy or insolvency petition or otherwise
institute insolvency proceedings with respect to the Company, or take any
action that would result in such an event occurring with respect to any
Owner Entity.
(b) Cause the dissolution, liquidation, consolidation, merger
or sale of substantially all of the assets of the Company or any Owner
Entity.
(c) Cause or permit the Company to engage in any other activity
other than those set forth in Section 2.04.
(d) Amend this Agreement in any manner that would have a
material adverse impact on any creditor of the Company.
6.06 CERTAIN ACTIONS PROHIBITED. So long as the Company has any
indebtedness outstanding, (a) the Company shall not be dissolved, liquidated,
consolidated or merged with any other entity, nor shall this Agreement be
amended in any manner that would have a material adverse impact on the holders
of such indebtedness, and (b) notwithstanding the failure of the Members to
continue the existence of the Company as provided in Section 2.06 during such
period, no action shall be taken by the Company or any of the Members shall
cause any collateral for such indebtedness to be liquidated or that would
adversely affect the rights of the holders of such indebtedness or their agents
to exercise their rights under any security documents relating thereto or to
retain such collateral until such indebtedness is paid in full or otherwise
completely discharged.
18
19
6.07 DISCLAIMER OF DUTIES AND LIABILITIES.
(a) NO MEMBER SHALL OWE ANY DUTY (INCLUDING ANY FIDUCIARY DUTY)
TO THE OTHER MEMBERS OR TO THE COMPANY, OTHER THAN THE DUTIES THAT ARE
EXPRESSLY SET FORTH IN THIS AGREEMENT.
(b) NO MEMBER SHALL BE LIABLE (WHETHER IN CONTRACT, TORT OR
OTHERWISE) FOR ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL
DAMAGES).
(c) THE OBLIGATIONS OF THE MEMBERS UNDER THIS AGREEMENT ARE
OBLIGATIONS OF THE MEMBERS ONLY, AND NO RECOURSE SHALL BE AVAILABLE
AGAINST ANY OFFICER, DIRECTOR OR AFFILIATE OF ANY MEMBER, EXCEPT AS
PERMITTED UNDER APPLICABLE LAW.
6.08 INDEMNIFICATION. Each Member shall indemnify, protect, defend,
release and hold harmless each other Member, and such other Member's
Representatives, Affiliates, and their respective directors, officers, employees
and agents from and against any Claims asserted by or on behalf of any Person
(including another Member) that arise out of, relate to or are otherwise
attributable to, directly or indirectly, a breach by the indemnifying Member of
this Agreement, or the negligence, gross negligence or willful misconduct of the
indemnifying Member in connection with the Project or this Agreement; provided,
however, that this Section 6.05 shall not apply to any Claim or other matter for
which a Member (or its Representative) has no liability or duty, or is
indemnified or released, pursuant to Section 6.02(a)(iii), 6.07 or 6.08.
ARTICLE 7
TAXES
7.01 TAX RETURNS. The Tax Matters Member shall prepare and timely file
(on behalf of the Company) all federal, state and local tax returns required to
be filed by the Company. Each Member shall furnish to the Tax Matters Member all
pertinent information in its possession relating to the Company's operations
that is necessary to enable the Company's tax returns to be timely prepared and
filed. The Company shall bear the costs of the preparation and filing of its
returns.
7.02 TAX ELECTIONS. The Company shall make the following elections on
the appropriate tax returns:
(a) to adopt as the Company's fiscal year the calendar year;
(b) to adopt the accrual method of accounting;
(c) if a distribution of the Company's property as described in
Code Section 734 occurs or upon a transfer of Membership Interest as
described in Code Section 743 occurs, on request by notice from any
Member, to elect, pursuant to Code Section 754, to adjust the basis of
the Company's properties;
(d) to elect to amortize the organizational expenses of the
Company ratably over a period of 60 months as permitted by Section 709(b)
of the Code; and
(e) any other election the Management Committee may deem
appropriate.
Neither the Company nor any Member shall make an election for the Company to be
excluded from the application of the provisions of subchapter K of chapter 1 of
subtitle A of the Code or any similar provisions of applicable state law and no
provision of this Agreement (including Section 2.07) shall be construed to
sanction or approve such an election.
19
20
7.03 TAX MATTERS MEMBER.
(a) Eastern shall be the "tax matters partner" of the Company
pursuant to Section 6231 (a)(7) of the Code (the "Tax Matters Member").
At the request of each other Member, the Tax Matters Member shall take
such action as may be necessary to cause, to the extent possible, such
other Member to become a "notice partner" within the meaning of Section
6223 of the Code. The Tax Matters Member shall inform each other Member
of all significant matters that may come to its attention in its capacity
as Tax Matters Member by giving notice thereof on or before the fifth
Business Day after becoming aware thereof and, within that time, shall
forward to each other Member copies of all significant written
communications it may receive in that capacity.
(b) The Tax Matters Member shall take no action without the
authorization of the Management Committee, other than such action as may
be required by Law. Any cost or expense incurred by the Tax Matters
Member in connection with its duties, including the preparation for or
pursuance of administrative or judicial proceedings, shall be paid by the
Company.
(c) The Tax Matters Member shall not enter into any extension
of the period of limitations for making assessments on behalf of the
Members without first obtaining the consent of the Management Committee.
The Tax Matters Member shall not bind any Member to a settlement
agreement without obtaining the consent of such Member. Any Member that
enters into a settlement agreement with respect to any Company item (as
described in Code Section 623 I(a)(3)) shall notify the other Members of
such settlement agreement and its terms within 90 Days from the date of
the settlement.
(d) No Member shall file a request pursuant to Code Section
6227 for an administrative adjustment of Company items for any taxable
year without first notifying the other Members. If the Management
Committee consents to the requested adjustment, the Tax Matters Member
shall file the request for the administrative adjustment on behalf of the
Members. If such consent is not obtained within 30 Days from such notice,
or within the period required to timely file the request for
administrative adjustment, if shorter, any Member, including the Tax
Matters Member, may file a request for administrative adjustment on its
own behalf. Any Member intending to file a petition under Code Sections
6226, 6228 or other Code Section with respect to any item involving the
Company shall notify the other Members of such intention and the nature
of the contemplated proceeding. In the case where the Tax Matters Member
is the Member intending to file such petition on behalf of the Company,
such notice shall be given within a reasonable period of time to allow
the other Members to participate in the choosing of the forum in which
such petition will be filed.
(e) If any Member intends to file a notice of inconsistent
treatment under Code Section 6222(b), such Member shall give reasonable
notice under the circumstances to the other Members of such intent and
the manner in which the Member's intended treatment of an item is (or may
be) inconsistent with the treatment of that item by the other Members.
ARTICLE 8
BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
8.01 MAINTENANCE OF BOOKS.
(a) The Management Committee shall keep or cause to be kept
at the principal office of the Company or at such other location approved
by the Management Committee complete and accurate books and records of
the Company, supporting documentation of the transactions with respect to
the conduct of the Company's business and minutes of the proceedings of
its Members and the Management Committee, and any other books and records
that are required to be maintained by applicable Law.
(b) The books of account of the Company shall be (i) maintained
on the basis of a fiscal year that is the calendar year, (ii) maintained
on an accrual basis in accordance with generally accepted accounting
principles, consistently applied, and (iii) audited by the Certified
Public Accountants at the end of each calendar year.
20
21
8.02 REPORTS.
(a) With respect to each calendar year, the Management
Committee shall prepare and deliver to each Member:
(i) Within 120 Days after the end of such calendar year,
a profit and loss statement and a statement of cash flows for such
year, a balance sheet and a statement of each Member's Capital
Account as of the end of such year, together with a report thereon
of the Certified Public Accountants and
(ii) Such federal, state and local income tax returns and
such other accounting, tax information and schedules as shall be
necessary for the preparation by each Member on or before July 15
following the end of each calendar year of its income tax return
with respect to such year.
(b) Within 15 Business Days after the end of each calendar
month, the Management Committee shall cause to be prepared and delivered
to each Member, with an appropriate certificate of the Person authorized
to prepare the same (provided that the Management Committee may change
the financial statements required by this Section 8.02(b) to a quarterly
basis or may make such other change therein as it may deem appropriate):
(i) A profit and loss statement and a statement of cash
flows for such month (including sufficient information to permit
the Members to calculate their tax accruals), for the portion of
the calendar year then ended;
(ii) A balance sheet and a statement of each Member's
Capital Account as of the end of such month and the portion of the
calendar year then ended; and
(iii) A statement comparing the actual financial status
and results of the Company as of the end of or for such month and
the portion of the calendar year then ended with the budgeted or
forecasted status and results as of the end of or for such
respective periods.
(c) The Management Committee shall also cause to be prepared
and delivered to each Member such other reports, forecasts, studies,
budgets and other information as the Management Committee may request
from time to time.
8.03 BANK ACCOUNTS. Funds of the Company shall be deposited in such
banks or other depositories as shall be designated from time to time by the
Management Committee. All withdrawals from any such depository shall be made
only as authorized by the Management Committee and shall be made only by check,
wire transfer, debit memorandum or other written instruction.
ARTICLE 9
BUYOUT OPTION
9.01 BUYOUT EVENTS. This Article 9 shall apply to any of the following
events (each a "Buyout Event"):
(a) a Member shall dissolve or become Bankrupt; or
(b) a Member shall commit a Default.
In each case, the Member with respect to whom a Buyout Event has occurred is
referred to herein as the "Affected Member."
9.02 PROCEDURE. If a Buyout Event occurs and is not cured within 30
Business Days of the Affected Member's receipt of notice thereof from another
Member (or such shorter period (not less than 10 Business Days) as may be
reasonable under the circumstances and set forth in such notice), then each of
the other Members shall have the option to acquire the Membership Interest of
the Affected Member (or to cause it to be acquired by a third
21
22
party designated by the other Members), in accordance with procedures that are
substantively equivalent to those set forth in Section 3.03(b)(iii) (and with
the Members exercising such preferential right also being referred to herein as
"Purchasing, Members")
9.03 PURCHASE PRICE; TERMS AND METHOD OF PAYMENT. The purchase price
for a Membership Interest being purchased pursuant to this Article 9 (the
"Purchase Price") shall be determined in the following manner. The Affected
Member and the Purchasing Members shall attempt to agree upon the fair market
value of the applicable Membership Interest and the terms and method of payment
of such amount. If those Members do not reach such agreement on or before the
30th Day following the exercise of the option, any such Member, by notice to the
others, may require the determination of fair market value and the terms and
method of payment to be made by the Arbitrator pursuant to Article 10.
9.04 CLOSING. If an option to purchase is exercised in accordance with
the other provisions of this Article 9, the closing of such purchase shall occur
on the 30th Day after the determination of the Fair Market Value pursuant to
Section 9.03 (or, if later, the fifth Business Day after the receipt of all
applicable regulatory and governmental approvals to the purchase), and shall be
conducted in a manner substantively equivalent to that set forth in Section
3.03.
9.05 TERMINATED MEMBER. Upon the occurrence of a closing under Section
9.04, the following provisions shall apply to the Affected Member (now a
"Terminated Member"):
(a) The Terminated Member shall cease to be a Member
immediately upon the occurrence of the closing.
(b) As the Terminated Member is no longer a Member, it will no
longer be entitled to receive any distributions (including liquidating
distributions) or allocations from the Company, and neither it nor its
Representative shall be entitled to exercise any voting or consent rights
or to receive any further information (or access to information) from the
Company.
(c) The Terminated Member must pay to the Company all amounts
owed to it by such Member.
(d) The Terminated Member shall remain obligated for all
liabilities it may have under this Agreement or otherwise with respect to
the Company that accrue prior to the closing.
(f) The Sharing Ratio of the Terminated Member shall be
allocated among the purchasing Members in the proportion of the total
Purchase Price paid by each.
ARTICLE 10
DISPUTE RESOLUTION
10.01 DISPUTES. This Article 10 shall apply to any dispute arising under
or related to this Agreement (whether arising in contract, tort or otherwise,
and whether arising at law or in equity), including (a) any dispute regarding
the construction, interpretation, performance, validity or enforceability of any
provision of this Agreement or whether any Person is in compliance with, or
breach of, any provisions of this Agreement, and (b) the applicability of this
Article 10 to a particular dispute. Notwithstanding the foregoing, this Article
10 shall not apply to any matters that, pursuant to the Provisions of this
Agreement, are to be resolved by a vote of the Members (including through the
Management Committee); provided, however, that if a vote, approval, consent,
determination or other decision must, under the terms of this Agreement, be
made (or withheld) in accordance with a standard other than Sole Discretion
(such as a reasonableness standard), then the issue of whether such standard has
been satisfied may be a dispute to which this Article 10 applies. Any dispute to
which this Article 10 applies is referred to herein as a "Dispute." With
respect to a particular Dispute, each Member that is a party to such Dispute is
referred to herein as a "Disputing Member." The provisions of this Article 10
shall be the exclusive method of resolving Disputes.
22
23
10.02 NEGOTIATION TO RESOLVE DISPUTES. If a Dispute arises, either
Disputing Member may initiate the dispute-resolution procedures of this Article
10 by delivering a notice (a "Dispute Notice") to the other Disputing Members.
Within 10 Days of delivery of a Dispute Notice, each Disputing Member shall
designate a representative, and such representatives shall promptly meet
(whether by phone or in person) in a good faith attempt to resolve the Dispute.
If such representatives can resolve the Dispute, such resolution shall be
reported in writing and shall be binding upon the Disputing Members. If such
representatives are unable to resolve the Dispute within 30 Days following the
delivery of the Dispute Notice (or such other period as such representatives may
agree), or if a Disputing Member fails to appoint a representative within 10
Days of delivery following the delivery of the Dispute Notice, then any
Disputing Member may take such Dispute to litigation.
ARTICLE 11
DISSOLUTION, WINDING-UP AND TERMINATION
11.01 DISSOLUTION. The Company shall dissolve and its affairs shall be
wound up on the first to occur of the following events (each a "Dissolution
Event"):
(a) the unanimous consent of the Members; or
(b) entry of a decree of judicial dissolution of the Company
under Section 18-802 of the Act.
11.02 WINDING-UP AND TERMINATION.
(a) On the occurrence of a Dissolution Event, the Management
Committee shall select one Member to act as liquidator. The liquidator
shall proceed diligently to wind up the affairs of the Company and make
final distributions as provided herein and in the Act. The costs of
winding up shall be borne as a Company expense. Until final distribution,
the liquidator shall continue to operate the Company properties with all
of the power and authority of the Members. The steps to be accomplished
by the liquidator are as follows:
(i) as promptly as possible after dissolution and again
after final winding up, the liquidator shall cause a proper
accounting to be made by a recognized firm of certified public
accountants of the Company's assets, liabilities, and operations
through the last calendar day of the month in which the
dissolution occurs or the final winding up is completed, as
applicable;
(ii) the liquidator shall discharge from Company funds
all of the Indebtedness and other debts, liabilities and
obligations of the Company (including all expenses incurred in
winding up and any loans described in Section 4.03) or otherwise
make adequate provision for payment and discharge thereof
(including the establishment of a cash escrow fund for contingent
liabilities in such amount and for such term as the liquidator may
reasonably determine); and
(iii) all remaining assets of the Company shall be
distributed to the Members as follows:
(A) the liquidator may sell any or all Company
property, including to Members, and any resulting gain or
loss from each sale shall be computed and allocated to the
Capital Accounts of the Members in accordance with the
provisions of Article 5;
(B) with respect to all Company property that has
not been sold, the fair market value of that property shall
be determined and the Capital Accounts of the Members shall
be adjusted to reflect the manner in which the unrealized
income, gain, loss, and deduction inherent in property that
has not been reflected in the Capital Accounts previously
would be allocated among the Members if there were a
taxable disposition of that property for the fair market
value of that property on the date of distribution; and
23
24
(C) Company property (including cash) shall be
distributed among the Members in accordance with Section
5.02; and those distributions shall be made by the end of
the taxable year of the Company during which the
liquidation of the Company occurs (or, if later, 90 Days
after the date of the liquidation).
(b) The distribution of cash or property to a Member in
accordance with the provisions of this Section 11.02 constitutes a
complete return to the Member of its Capital Contributions and a
complete distribution to the Member of its Membership Interest and
all the Company's property and constitutes a compromise to which
all Members have consented pursuant to Section 18-502(b) of the
Act. To the extent that a Member returns funds to the Company, it
has no claim against any other Member for those funds.
11.03 DEFICIT CAPITAL ACCOUNTS. No Member will be required to pay to the
Company, to any other Member or to any third party any deficit balance that may
exist from time to time in the Member's Capital Account.
11.04 CERTIFICATE OF CANCELLATION. On completion of the distribution of
Company assets as provided herein, the Members (or such other Person or Persons
as the Act may require or permit) shall file a certificate of cancellation with
the Secretary of State of Delaware, cancel any other filings made pursuant to
Section 2.05, and take such other actions as may be necessary to terminate the
existence of the Company. Upon the filing of such certificate of cancellation,
the existence of the Company shall terminate (and the Term shall end), except as
may be otherwise provided by the Act or other applicable Law.
ARTICLE 12
GENERAL PROVISIONS
12.01 OFFSET. Whenever the Company is to pay any sum to any Member, any
amounts that Member owes the Company may be deducted from that sum before
payment.
12.02 NOTICES. Except as expressly set forth to the contrary in this
Agreement, all notices, requests or consents provided for or permitted to be
given under this Agreement must be in writing and must be delivered to the
recipient in person, by courier or mail or by facsimile or other electronic
transmission. A notice, request or consent given under this Agreement is
effective on receipt by the Member to receive it; provided, however, that a
facsimile or other electronic transmission that is transmitted after the normal
business hours of the recipient shall be deemed effective on the next Business
Day. All notices, requests and consents to be sent to a Member must be sent to
or made at the addresses given for that Member on Exhibit A or in the instrument
described in Section 3.03(b)(iv)(A)(II) or 3.04, or such other address as that
Member may specify by notice to the other Members. Any notice, request or
consent to the Company must be given to all of the Members. Whenever any notice
is required to be given by Law, the Delaware Certificate or this Agreement, a
written waiver thereof, signed by the Person entitled to notice, whether before
or after the time stated therein, shall be deemed equivalent to the giving of
such notice.
12.03 ENTIRE AGREEMENT; SUPERSEDING EFFECT. This Agreement constitutes
the entire agreement of the Members and their Affiliates relating to the Company
and the transactions contemplated hereby and supersedes all provisions and
concepts contained in all prior contracts or agreements between the Members or
any of their Affiliates with respect to the Company and the transactions
contemplated hereby, whether oral or written, except for the Preliminary
Agreement as specifically provided herein, and for liabilities accrued under the
Preliminary Agreement.
12.04 PRESS RELEASES. Each Member agrees that it shall not (and shall
cause its Affiliates not to), without the other Members' consent, issue a press
release or have any contact with or respond to the news media with any sensitive
or Confidential Information, except as required by securities or similar laws
applicable to a Member and its Affiliates. Any press release by a Member or its
Affiliates with respect to any sensitive or Confidential Information shall be
subject to review and approval by the other Party, which approval shall not be
unreasonably withheld.
12.05 EFFECT OF WAIVER OR CONSENT. Except as otherwise provided in this
Agreement, a waiver or consent, express or implied, to or of any breach or
default by any Member in the performance by that Member of its obligations with
respect to the Company is not a consent or waiver to or of any other breach or
default in the
24
25
performance by that Member of the same or any other obligations of that Member
with respect to the Company Except as otherwise provided in this Agreement,
failure on the part of a Member to complain of any act of any Member or to
declare any Member in default with respect to the Company, irrespective of how
long that failure continues, does not constitute a waiver by that Member of its
rights with respect to that default until the applicable statute-of-limitations
period has run.
12.06 AMENDMENT OR RESTATEMENT. This Agreement or the Delaware
Certificate may be amended or restated only by a written instrument executed
(or, in the case of the Delaware Certificate, approved) by all of the Members.
12.07 BINDING EFFECT. Subject to the restrictions on Dispositions set
forth in this Agreement, this Agreement is binding on and shall inure to the
benefit of the Members and their respective successors and permitted assigns.
12.08 GOVERNING LAW; CONSTRUCTION. This Agreement is governed by and
shall be construed in accordance with the Law of the state of Delaware,
excluding any conflict-of-laws rule or principle that might refer the governance
or the construction of this agreement to the Law of another jurisdiction. In the
event of a direct conflict between the provisions of this Agreement and any
mandatory, non-waivable provision of the Act, such provision of the Act shall
control.
NRG EASTERN LLC
By: /s/ XXXXX X. XXXXXXXXXXX
------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
----------------------------
Title: President
---------------------------
NORTHEAST GENERATION HOLDING LLC
By: /s/ XXXXX X. XXXXXXXXXXX
------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
----------------------------
Title: President
---------------------------
XXV
