Exhibit 10-22
PRODUCER - CUSTOMER NMP - 2
POWER PURCHASE AGREEMENT
This Power Purchase Agreement (this "Agreement"), dated as of December 11,
2000 by and between Constellation Nuclear, LLC, ("PRODUCER"), a Maryland limited
liability company with offices located at 00 Xxxx Xxxxxxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxxxx, XX 00000, and Niagara Mohawk Power Corporation ("CUSTOMER"), a New
York company with offices located at 000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxx, XX 00000
(PRODUCER and CUSTOMER are each referred to herein as a "Party", and
collectively as the "Parties").
WITNESSETH:
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WHEREAS, PRODUCER and CUSTOMER have entered into an Asset Purchase
Agreement pursuant to which CUSTOMER has agreed to sell and PRODUCER has agreed
to purchase, certain interests in the Nine Xxxx Xxxxx Xxxx Xx. 0 Nuclear
Generating Station ("NMP-2"), dated December 11, 0000 (xxx "XXX-0 XXX");
WHEREAS, PRODUCER and CUSTOMER have entered into an Asset Purchase
Agreement pursuant to which CUSTOMER has agreed to sell and PRODUCER has agreed
to purchase, certain interests in Nine Xxxx Xxxxx Xxxx Xx. 0 Nuclear Generating
Station ("NMP-1"), dated December 11, 0000 (xxx "XXX-0 XXX");
WHEREAS, simultaneously with the execution of this Agreement, PRODUCER,
Niagara Mohawk Power Corporation ("Niagara Mohawk") and New York State Electric
& Gas Company ("NYSEG") have executed an Interconnection Agreement of even date
with this Agreement (the "NMP-2 ICA") governing the terms of interconnection of
NMP-2 with the Transmission System, as that term is defined in the NMP-2 ICA;
and
WHEREAS, simultaneously with the execution of this Agreement, PRODUCER and
CUSTOMER have executed a Revenue Sharing Agreement of even date with this
Agreement governing certain adjustments to the purchase price for NMP-2 (the
"NMP-2 RSA").
NOW, THEREFORE, in consideration of these premises, the mutual agreements
set forth herein and other good and valuable consideration, and intending to be
legally bound, the Parties agree as follows:
1. DEFINITIONS. In addition to the terms defined elsewhere herein, the
following capitalized terms shall have the meaning stated below when used
in this Agreement:
1.1. "Ancillary Services" shall mean those services necessary to support
the transmission of Energy from generators to loads, while maintaining
reliable operation of the New York State power system in accordance
with Good Utility Practice and reliability rules. Ancillary Services
include
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scheduling, system control and dispatch service, reactive supply and
voltage support service, regulation and frequency response service,
energy imbalance service, operating reserve service (including
spinning reserve, 10-minute non-synchronized reserves and 30-minute
reserves), and black start capability, and as defined in Section 2.16
of the NYISO Market Administration and Control Area Services Tariff,
as amended or superseded from time to time.
1.2. "Bilateral Transaction" shall mean a transaction between two or more
parties for the purchase and/or sale of Installed Capacity, Energy,
and/or Ancillary Services other than those in the ISO Administered
Markets, and as defined in Section 2.16 of the NYISO Market
Administration and Control Area Services Tariff, as amended or
superseded from time to time.
1.3. "Capability Period" shall mean six-month periods which are established
as follows: (1) from May 1 through October 31 of each year (Summer
Capability Period); and (2) from November 1 of each year through April
30 of the following year (Winter Capability Period), as defined in
Section 2.17 of the NYISO Market Administration and Control Area
Services Tariff, as amended or superseded from time to time.
1.4. "Closing" shall have the meaning set forth in the NMP-2 APA.
1.5. "Contract Year" shall mean each twelve (12) month period during the
Term (as defined in Section 3 hereof) starting with the Effective
Date. For the purposes of this Agreement, the first month of the Term
starts on the Effective Date and ends on the last calendar day of the
first full calendar month following the Effective Date. All subsequent
months during the Term are calendar months.
1.6. "Contract Year Base Price" shall mean the prices so identified in
Schedule A.
1.7. "Day-Ahead Market" (DAM) shall mean the NYISO administered market in
which Energy and/or Ancillary Services are scheduled and sold day-
ahead consisting of the day-ahead scheduling process, price
calculations and settlements, as defined at Definition 1.7d of the
NYISO OATT, as amended or superseded from time to time.
1.8. "DAM Scheduled Net Electric Output" shall mean, for any hour,
scheduled electric output with the NYISO in the DAM Market pursuant to
Article 5.3, which shall be the Day-Ahead-Market expected Energy
production generated by NMP-2 less (a) the Energy used to operate NMP-
2, but excluding Off-site Power Service used to operate NMP-2 as
defined in the NMP-2 ICA, and (b) the Energy used in the
transformation and
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transmission of electric power to the Delivery Point, provided that
for purposes of this Agreement, such DAM Scheduled Net Electric
Output shall not be less than zero. Such DAM Scheduled Net Electric
Output shall be estimated using Good Utility Practice and shall
approximate as accurately as reasonably possible the expected Net
Electric Output.
1.9. "Delivery Point" shall mean the "Delivery Points" as that term is
defined in the NMP-2 ICA and as indicated on the one-line diagram
included as part of Schedule A to the NMP-2 ICA.
1.10. "Dependable Maximum Net Capability" (DMNC) shall mean the sustained
maximum net output of a generator, as demonstrated by the performance
of a test or through actual operation, averaged over a continuous
period of time, and as defined in Section 2.40 of the NYISO Market
Administration and Control Area Services Tariff, as amended or
superseded from time to time.
1.11. "Dependable Maximum Net Capability Test" (DMNC Test) shall mean a
test performed in accordance with and as defined in Section 2.40 of
the NYISO Services Tariff, as amended or superseded from time to
time.
1.12. "Effective Date" shall mean the date of the Closing.
1.13. "Energy" shall mean a quantity of electricity that is bid, produced,
consumed, sold, or transmitted over a period of time, and measured or
calculated in megawatt hours (MWh).
1.14. "First Hour" shall mean that full or portion of an hour occurring
from the moment that the Parties jointly declare the NMP-2 APA
consummated to the beginning of the next hour.
1.15. "Good Utility Practice" shall mean any of the practices, methods and
acts engaged in or approved by a significant portion of the electric
utility industry during the relevant time period, or any of the
practices, methods and acts which, in the exercise of reasonable
judgment in light of the facts known at the time the decision was
made, could have been expected to accomplish the desired result at a
reasonable cost consistent with good business practices, reliability,
safety, expedition and compliance with applicable law and
regulations. Good Utility Practice is not intended to be limited to
the optimum practice, method, or act, to the exclusion of all others,
but rather to be practices, methods, or acts generally accepted in
the electric utility industry. Good Utility Practices shall include,
where applicable, but not be limited to North American Electric
Reliability Council ("NERC") criteria, guidelines, rules and
standards, Northeast Power Coordinating Council ("NPCC") criteria,
guidelines, rules and standards, New York State Reliability Council
("NYSRC") criteria, guidelines, rules
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and standards, if any, and NYISO criteria, guidelines, rules and
standards, as they may be amended from time to time including the
rules, guidelines and criteria of any successor organization of the
foregoing entities. When applied to PRODUCER, the term Good Utility
Practice shall also include standards applicable to a generator were
the generator a utility generator connecting to the distribution or
transmission facilities or system of another utility.
1.16. "Installed Capacity" shall mean a generator or load facility that
complies with the requirements of the reliability rules and is
capable of supplying and/or reducing the demand for Energy in the New
York Control Area for the purpose of ensuring that sufficient Energy
and capacity are available to meet the reliability rules, as defined
at Definition 1.14 of the NYISO OATT, as amended or superseded from
time to time. The Installed Capacity requirement, established by the
New York State Reliability Counsel and the NYISO, and applied by and
through the NYISO OATT, includes a margin of reserve in accordance
with the reliability rules.
1.17. "Interest Rate" means, for any date, the interest equal to the prime
rate of Citibank as may from time to time be published in The Wall
Street Journal under "Money Rates".
1.18. "Monthly Off-Peak Price" shall mean the product of (i) the Contract
Year Base Price times (ii) the Off-Peak Monthly Price Factor for the
respective Contract Years and calendar months, such prices and
factors being set forth in Schedules A and B respectively.
1.19. "Monthly On-Peak Price" shall mean the product of (i) the Contract
Year Base Price times (ii) the On-Peak Monthly Price Factor for the
respective Contract Years and calendar months, such prices and
factors being set forth in Schedules A and B, respectively.
1.20. "New York Control Area" (NYCA) shall have the meaning as defined
Section 1.13 of the NYISO Market Administration and Control Area
Services Tariff, as amended or superseded from time to time.
1.21. "New York Independent System Operator" (NYISO) shall mean the not-
for-profit corporation established in accordance with orders of the
Federal Energy Regulatory Commission to administer the operation of,
to provide equal access to, and to maintain the reliability of the
bulk-power transmission system in New York State, or any successor
organization.
1.22. "NYISO OATT" shall mean the New York Independent System Operator Open
Access Transmission Tariff revised as of 12/27/99, as amended and
superseded from time to time.
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1.23. "NYISO Services Tariff" shall mean the New York Independent System
Operator Market Administration and Control Area Services Tariff
revised as of 11/17/99, as amended and superseded from time to time.
1.24. "Net Electric Output" shall mean the Energy production generated by
NMP-2 less (a) the Energy used to operate NMP-2, but excluding Off-
site Power Service used to operate NMP-2 as defined in the NMP-2 ICA,
and (b) the Energy used in the transformation and transmission of
electric power to the Delivery Point, provided that for purposes of
this Agreement, such Net Electric Output shall not be less than zero.
1.25. "Off-Peak" shall mean the hours between 11:00 p.m. and 7:00 a.m.,
prevailing Eastern Time, Monday through Friday, and all hours on
Saturday and Sunday, and NERC-defined holidays, or as otherwise
decided by the NYISO.
1.26. "On-Peak" shall mean the hours between 7:00 a.m. and 11:00 p.m.
inclusive, prevailing Eastern Time, Monday through Friday, except
NERC-defined holidays, or as otherwise decided by the NYISO.
2. CONDITION PRECEDENT. It is a condition precedent to the obligations of
PRODUCER and CUSTOMER under this Agreement that the Closing shall have
occurred.
3. TERM. The term ("Term") of this Agreement shall begin on the Effective Date
and shall expire at 12:00 midnight prevailing Eastern Time on the day that
is exactly ten years after the last day of the month during which the
Effective Date occurs. Notwithstanding any other provision of this
Agreement, this Agreement shall become ineffective and shall terminate in
the event the NMP-2 APA terminates.
4. INSTALLED CAPACITY.
4.1. Sale of Installed Capacity. PRODUCER shall provide, and CUSTOMER
shall accept, from the Effective Date through the end of the first
Capability Period occurring during the Term an amount of Installed
Capacity equal to the product of (i) forty-one percent (41%) times
(ii) ninety percent (90%) of the DMNC of NMP-2 during the first
Capability Period occurring during the Term (up to a maximum of 1,140
MW for the Summer Capability Period and 1,155 MW for the Winter
Capability Period). PRODUCER shall provide, and CUSTOMER shall
accept, from the end of the first Capability Period occurring during
the Term through the end of the last Capability Period occurring
during the Term an amount of Installed Capacity equal to the product
of (i) forty-one percent (41%) times (ii) ninety percent (90%) of the
seasonal DMNC of NMP-2 up to a maximum
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of 1,140 MW for the Summer Capability Period and 1,155 MW for the
Winter Capability Period.
4.2. Performance. PRODUCER shall use good faith efforts to ensure that the
Installed Capacity for NMP-2 is as high as practicable, consistent
with the Energy generated by the plant. In no event, however, will
PRODUCER be required to contract for, or take any other measure to
obtain, additional installed capacity to satisfy its obligations under
this Section. In accordance with NYISO requirements, PRODUCER shall
perform DMNC Tests and PRODUCER shall use good faith efforts to
maximize the output of the plant during such tests. The Parties will
coordinate the scheduling of such tests.
5. ENERGY.
5.1. Sale of Energy. During the Term of this Agreement, PRODUCER shall
deliver, and CUSTOMER shall accept, an amount of Energy equal to the
product of (i) forty-one percent (41%) times (ii) ninety percent (90%)
times (iii) the DAM Scheduled Net Electric Output or, if applicable,
the Net Electric Output during each hour of the Term up to a maximum
total amount of Energy in each such hour of 1,148 MWh.
5.2. Performance. Except as provided in Section 5.3.1, PRODUCER shall have
no obligation to produce or deliver any amount of Energy hereunder.
If for any reason which is not prohibited by this Agreement PRODUCER
generates an insufficient amount of Energy at the facilities to be
able to deliver the amount specified in section 5.1 hereof, PRODUCER
shall have no obligation to sell or deliver, and CUSTOMER shall have
no obligation to buy or accept, the portion of the amount specified in
section 5.1 not generated by PRODUCER, or any replacement Energy.
5.3. Scheduling. CUSTOMER shall have the option, exercisable at its sole
discretion and upon written notice twenty-four (24) hours in advance
of the NYISO's scheduling requirement for provision of the DAM
schedule to PRODUCER to: (i) have PRODUCER deliver and schedule DAM
Scheduled Net Electric Output as provided in section 5.3.1 below; or
(ii) have PRODUCER deliver and CUSTOMER schedule Net Electric Output
as provided in Section 5.3.2 below.
5.3.1. DAM Scheduled Net Electric Output. Notwithstanding Section 5.2,
PRODUCER shall provide the NYISO with a request for a Bilateral
Transaction schedule in the Day-Ahead Market, in accordance with
the NYISO Market Administration and Control Area Services Tariff,
for the DAM Scheduled Net Electric Output to be delivered to
CUSTOMER under this Agreement. PRODUCER shall be solely
responsible for all charges imposed by the NYISO as a result of
any failure by
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PRODUCER to deliver the amount of DAM Scheduled Net Electric
Output specified in the Bilateral Transaction schedule.
5.3.2. Net Electric Output. CUSTOMER shall effectuate the scheduling with
the NYISO for Net Electric Output delivered by PRODUCER to
CUSTOMER under this Agreement.
5.3.3. Mitigation. The Party scheduling a Bilateral Transaction with the
NYISO shall be obligated to mitigate any charges or penalties
imposed by the NYISO on the non-scheduling Party.
5.4. Other Costs. With regard to DAM Scheduled Net Electric Output or, if
applicable, Net Electric Output delivered by PRODUCER to CUSTOMER
pursuant to this Agreement at the Delivery Point, except as the NMP-2
ICA provides, PRODUCER shall bear no cost or liability for the DAM
Scheduled Net Electric Output or, if applicable, Net Electric Output
beyond the Delivery Point.
5.5. Title and Risk of Loss. Title and risk of loss transfers from PRODUCER
to CUSTOMER upon receipt of the DAM Scheduled Net Electric Output or,
if applicable, Net Electric Output by CUSTOMER from PRODUCER at the
Delivery Point.
5.6. Taxes. Taxes applicable to the DAM Scheduled Net Electric Output or,
if applicable, Net Electric Output delivered by PRODUCER to CUSTOMER
pursuant to this Agreement, or to transactions involving such DAM
Scheduled Net Electric Output or, if applicable, Net Electric Output,
(other than taxes based on PRODUCER's and/or CUSTOMER's net income),
shall be borne by CUSTOMER if related to or arising after receipt at
the Delivery Point of such DAM Scheduled New Electric Output or, if
applicable, Net Electric Output, and shall be borne by PRODUCER if
related to or arising before receipt at the Delivery Point of such DAM
Scheduled New Electric Output or, if applicable, Net Electric Output.
5.7. Outages. PRODUCER shall schedule and perform all plant outages
consistent with Good Utility Practice, and in accordance with the
terms of the NMP-2 ICA. PRODUCER shall provide CUSTOMER with as much
advance notice as possible of scheduled outages, unscheduled outages,
power reductions, and deratings. Except as reasonably required by Good
Utility Practice, PRODUCER shall not schedule any portion of a
refueling outage during the months of June, July, August, or
September.
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6. OTHER PRODUCTS AND SALES. Nothing herein shall preclude PRODUCER from
selling any Ancillary Service, Energy, Installed Capacity or other product
or service or quantity thereof associated with NMP-2 to a third party or
the NYISO not needed to fulfill PRODUCER's obligations hereunder.
7. PRICE. The price during each hour of the Term for such amount of Installed
Capacity and Energy as is provided pursuant to Article 4 and Article 5
respectively of this Agreement, shall be determined using the data set
forth in Schedules A and B. The amounts payable by CUSTOMER to PRODUCER
shall be calculated monthly, and shall be equal to the sum of the product
of (i) the DAM Scheduled Net Electric Output or, if applicable, Net
Electric Output in MWh delivered by PRODUCER to CUSTOMER each hour times
(ii) the applicable price for each hour as determined from Schedules A and
B for all hours of the month. No other amount shall be payable by CUSTOMER
for Installed Capacity or Energy provided by PRODUCER pursuant to this
Agreement.
8. XXXXXXXX AND PAYMENTS.
8.1. Payment. PRODUCER shall provide CUSTOMER with an invoice setting forth
the quantity of Energy (MWh), as recorded by the Revenue Meters
defined and provided for in the NMP-2 ICA, which was delivered to
CUSTOMER in the indicated month, on or before the 5/th/ day of each
month for the preceding monthly period. CUSTOMER shall remit the
amount due by wire transfer, or as otherwise agreed, pursuant to
PRODUCER's invoice instructions, on the later of fifteen days from
receipt of PRODUCER's invoice or the twenty-fifth (25/th/) day of the
calendar month in which the invoice is rendered. In the event the
25/th/ is a weekend day or a holiday on which banking institutions are
not open in New York State, then payment shall be made upon the
following business day.
8.2. Overdue Payments. Overdue payments shall accrue interest at the
Interest Rate from, and including, the due date to, but excluding, the
date of payment.
8.3. Billing Dispute. If CUSTOMER, in good faith, disputes an invoice,
CUSTOMER shall notify PRODUCER in writing within ten (10) business
days of receipt of the invoice of the basis for the dispute and pay
the portion of such statement not in dispute no later than the due
date. If any amount withheld under dispute by CUSTOMER is ultimately
determined (under the terms herein) to be due to PRODUCER, it shall be
paid within three (3) business days of such determination along with
interest accrued at the Interest Rate until the date paid. Inadvertent
overpayments shall be returned by PRODUCER upon request or deducted by
PRODUCER from subsequent invoices, with interest accrued at the
Interest Rate until the date paid or deducted.
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8.4. Mutual Rights of Offset. PRODUCER hereby acknowledges and agrees that,
if an "Event of Default" has occurred under the promissory note(s)
(such Event as defined therein) executed by PRODUCER in favor of
CUSTOMER at the Closing (the "Note"), CUSTOMER shall have the right to
offset and/or net any payments then owed by PRODUCER under the Note in
relation to the NMP-1 APA and the NMP-2 APA against any payments or
other amounts due from CUSTOMER to PRODUCER under this Agreement, or
the NMP-1 Power Purchase Agreement. CUSTOMER hereby acknowledges and
agrees that, if CUSTOMER is deemed to be in default hereunder (as
defined herein in Section 9.1.3 hereof), then PRODUCER may offset
and/or net payments then owed by CUSTOMER hereunder against any
payments or other amounts due from PRODUCER to CUSTOMER under the
Note. Notwithstanding the foregoing, if pursuant to Section 14 of the
Note, a Surety Bond, Letter of Credit or other financial assurance
shall have been provided by CUSTOMER under the Note, PRODUCER's right
of offset shall be deemed to no longer apply to the Note, and shall
apply only to such Surety Bond, Letter of Credit or other financial
assurance.
9. DEFAULT, TERMINATION AND LIABILITY.
9.1. Breach, Cure and Default.
9.1.1. Breach. A breach of this Agreement shall occur upon the failure by
a Party to perform or observe any material term or condition of
this Agreement as described in Section 9.1.2. of this Agreement.
9.1.2. Events of Breach. A breach of this Agreement shall include: (a)
the failure to pay any amount due, unless such amount is disputed
in compliance with Section 8.3 of this Agreement; (b) the failure
to comply with any material term or condition of this Agreement;
(c) the appointment of a receiver, liquidator or trustee for a
Party, or of any property of a Party, if such receiver, liquidator
or trustee is not discharged within sixty (60) days; (d) the entry
of a decree adjudicating a Party bankrupt or insolvent if such
decree is continued undischarged and unstayed for a period of
sixty (60) days; and (e) the filing by a Party of a voluntary
petition in bankruptcy under any provision of any federal or state
bankruptcy law.
9.1.3. Cure and Default. Upon a Party's breach of its obligations under
this Agreement, (except for breaches described in (c), (d), and
(e) of Section 9.1.2, whose occurrence shall constitute a default
by the Party), the other Party (hereinafter the "Non-Breaching
Party") shall give such Party in breach (the "Breaching Party") a
written notice specifying the nature of the breach, describing the
breach in reasonable detail, and demanding that the Breaching
Party cure such
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breach. The Breaching Party shall be deemed to be in default of
its obligations under this Agreement (i) if it fails to cure its
breach within thirty (30) days after its receipt of such notice,
(ii) where the breach is such that it cannot be cured within
thirty (30) days after its receipt of such notice, the Breaching
Party does not in good faith commence within thirty (30) days all
such steps as are commercially reasonable efforts that are
necessary and appropriate to cure such breach and thereafter
diligently pursue such steps to completion, or (iii) where the
breach cannot be cured within any commercially reasonable period
of time.
9.1.4. Remedies upon Default. Upon a Party's default as described in
Section 9.1.3, the non-defaulting Party may, at its option (i)
continue performance under this Agreement and exercise such other
rights and remedies as it may have in equity, at law or under this
Agreement; or (ii) terminate this Agreement in accordance with
Section 9.2 hereof.
9.1.5. Waiver. No provision of this Agreement may be waived except by
mutual agreement of the Parties as expressed in writing and
executed by each Party. Any waiver that is not in writing and
executed by each Party shall be null and void from its inception.
No express waiver in any specific instance as provided in a
required writing shall be construed as a waiver in future
instances unless specifically so provided in the required writing.
No express waiver of any specific default shall be deemed a waiver
of any other default whether or not similar to the default waived,
or a continuing waiver of any other right or default by a Party.
The failure of any Party to insist in any one or more instances
upon the strict performance of any of the provisions of this
Agreement, or to exercise any right herein, shall not be construed
as a waiver or relinquishment for the future of such strict
performance of such provision or the exercise of such right.
Further, delay by any Party in enforcing its rights under this
Agreement shall not be deemed a waiver of such rights.
9.2. Termination. If a Breaching Party is deemed to be in default as
described in Section 9.1.3, then the Non-Breaching Party may terminate
this Agreement by providing ten (10) days advanced written notice to
the Party in default. Termination of this Agreement shall not relieve
any Party of any of their liabilities and obligations arising
hereunder prior to the date termination becomes effective.
9.3. Additional Remedies. A Party's right to terminate as the result of an
occurrence of a default of any other Party shall not serve to limit
the rights such non-defaulting Party may have under law or equity as a
result of such default.
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9.4. Mitigation of Damages. A non-defaulting Party has a duty to mitigate
damages in the event of a default. The provisions of this Section 9.4
shall survive termination of this Agreement.
9.5. Exclusion of Damages. In no event will either Party be liable under
this Agreement, or under any cause of action relating to the subject
matter of this Agreement, for any special, indirect, incidental,
punitive, exemplary or consequential damages, including but not
limited to loss of profits or revenues, loss of use of any property,
cost of substitute equipment, facilities or services, downtime costs
or claims of third parties for such damages, except to the extent
that such damages arise from the gross negligence or intentional
misconduct of the Party from whom such damages are sought. The
provisions of this Section 9.5 shall survive termination of this
Agreement.
10. CONTRACT ADMINISTRATION AND OPERATION.
10.1. Party Representatives. PRODUCER and CUSTOMER shall each appoint a
representative who will be duly authorized to act on behalf of the
Party that appoints him/her, and with whom the other Party may
consult at all reasonable times, and whose instructions, requests,
and decisions shall be binding on the appointing Party as to all
matters pertaining to the administration of this Agreement.
10.2. Record Retention and Access. PRODUCER and CUSTOMER shall each keep
complete and accurate records and all other data required by either
of them for the purpose of proper administration of this Agreement,
including such records as may be required by state or federal
regulatory authorities or the NYISO. All such records shall be
maintained for a minimum of five (5) years after the creation of the
record or data and for any additional length of time required by
state or federal regulatory agencies with jurisdiction over PRODUCER
or CUSTOMER. PRODUCER and CUSTOMER, on a confidential basis, will
provide reasonable access to records kept pursuant to this Section of
this Agreement. The Party seeking access to such records shall pay
100% of any out-of-pocket costs the other Party incurs to provide
such access.
10.3. Notices. All notices pertaining to this Agreement not explicitly
permitted to be in a form other than writing shall be in writing and
shall be given by same day or overnight delivery, electronic
transmission, certified mail, or first class mail. Any notice shall
be given to the other Party as follows:
If to PRODUCER:
Constellation Nuclear, LLC
00 Xxxx Xxxxxxxxx Xxxxxx
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18th Floor
Baltimore, MD. 21201
Title: President
Attn: Xxxxxx X. Xxxxxx
Phone: (000) 000-0000
Facsimile: (000) 000-0000
If to CUSTOMER:
Niagara Mohawk Power Corporation
000 Xxxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Title: Director of Energy Transactions
Attn.: Xxxxx Xxxxxxxxxx
Phone: (000) 000-0000
Facsimile: (000) 000-0000
If given by electronic transmission (including telex, facsimile or
telecopy), notice shall be deemed given on the date received and shall
be confirmed by a written copy sent by first class mail. If sent in
writing by certified mail, notice shall be deemed given on the second
business day following deposit in the United States mails, properly
addressed, with postage prepaid. If sent by same-day or overnight
delivery service, notice shall be deemed given on the day of delivery.
PRODUCER and CUSTOMER may, by written notice to the other, change its
representative(s), including its Company Representative, and the
address to which notices are to be sent.
11. BUSINESS RELATIONSHIP. Each Party shall be solely liable for the payment of
all wages, taxes, and other costs related to the employment by such Party
of persons who perform this Agreement, including all federal, state, and
local income, social security, payroll and employment taxes and
statutorily-mandated workers' compensation coverage. None of the persons
employed by either Party shall be considered employees of the other Party
for any purpose.
12. CONFIDENTIALITY. Except as otherwise required by law, the Parties shall
keep confidential the terms and conditions of this Agreement and the
transactions undertaken hereto. If a Party is required to file this
Agreement with any regulatory body or court, it shall seek trade secret
protection from such authority and notify the other Party of the
requirement.
13. GOVERNMENT REGULATION. This Agreement and all rights and obligations of the
Parties hereunder are subject to all applicable federal, state and local
laws and all duly promulgated orders and duly authorized actions of
governmental authorities having proper and valid jurisdiction over the
terms of this Agreement. In addition, the rates, terms, and conditions
contained in this Agreement are not
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subject to change under Section 205 of the Federal Power Act, as that
section may be amended or superseded, absent the mutual written agreement
of the Parties.
14. GOVERNING LAW/CONTRACT CONSTRUCTION. This Agreement shall be interpreted,
construed, and governed by the law of the State of New York. For purposes
of contract construction, or otherwise, this Agreement is the product of
negotiation and neither Party to it shall be deemed to be the drafter of
this Agreement or any part hereof. The Section and Subsection headings of
this Agreement are for convenience only and shall not be construed as
defining or limiting in any way the scope or intent of the provisions
hereof. Litigation of claims or disputes arising under this Agreement shall
be brought in state or federal court in the State of New York.
15. DISPUTE RESOLUTION.
15.1. All claims, disputes, and other matters concerning the interpretation
and enforcement of this Agreement, shall be submitted to binding
arbitration in New York, NY and shall be heard by three neutral
arbitrators under the Commercial Arbitration Rules of the American
Arbitration Association.
15.2. Only the Parties hereto and their designated representatives shall be
permitted to participate in any arbitration initiated pursuant to
this Agreement. The arbitration process shall be concluded not later
than six (6) months after the date that it is initiated. The award of
the arbitrators shall be accompanied by a reasoned opinion if
requested by either Party. The award rendered in such a proceeding
shall be final. The Parties shall keep the award, and any opinion
issued by the arbitrators, confidential unless the Parties agree
otherwise. Any award of amounts due shall include interest accrued at
the Interest Rate until the date paid. Judgment may be entered upon
the arbitration opinion and award in any court having jurisdiction.
15.3. The procedures for the resolution of disputes set forth herein shall
be the sole and exclusive procedures for the resolution of disputes.
Each Party is required to continue to perform its obligations under
this Agreement pending final resolution of a dispute. All
negotiations pursuant to these procedures for the resolution of
disputes will be confidential, and shall be treated as compromise and
settlement negotiations for purposes of the Federal Rules of Evidence
and State Rules of Evidence and similarly applicable rules or
regulations of any state or federal regulatory agency with
jurisdiction over a Party.
16. WAIVER AND AMENDMENT. Any waiver by either Party of any of the provisions
of this Agreement must be made in writing, and shall apply only to the
instance referred to in the writing, and shall not, on any other occasion,
be
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construed as a bar to, or a waiver of, any right either Party has under
this Agreement. The Parties may not modify, amend, or supplement this
Agreement except by a writing signed by the Parties.
17. BINDING EFFECT; NO THIRD-PARTY RIGHTS OR BENEFITS. This Agreement is
entered into solely for the benefit of PRODUCER and CUSTOMER, and their
respective successors and permitted assigns, and therefore is not intended
and shall not be construed to confer any rights or benefits on any third-
party.
18. ENTIRE AGREEMENT. This Agreement, including references to and incorporation
of other agreements and tariffs, contains the complete and exclusive
agreement and understanding between the Parties as to its subject matter.
19. ASSIGNMENT. CUSTOMER shall have the right to assign the Agreement in whole
or in part, subject to a 50 MW minimum, without the consent of the
PRODUCER, (A) provided that (i) such assignee's long-term unsecured debt
credit rating issue by Xxxxx'x Investors Service, Standard & Poor's
Corporation or another nationally recognized rating agency is investment
grade rated, and (ii) provided that the CUSTOMER's agreement with the
assignee requires that for so long as the assignee's credit rating is
reduced to the lesser of (a) below investment grade or (b) below its credit
rating at the time of the assignment, the assignee shall deliver to
PRODUCER, in a form reasonably satisfactory to PRODUCER, either (x) a
guarantee of the assignee's obligations by its parent provided that such
parent entity's long-term unsecured debt credit rating issue by Xxxxx'x
Investors Service, Standard & Poor's Corporation or another nationally
recognized rating agency is investment grade, or (y) an irrevocable,
standby letter of credit issued by a banking or other financial
institution, the long-term unsecured debt obligations of which is rated
investment grade, with a drawing amount equal to the obligations under this
Agreement which have been assigned to the assignee and then remain, and
that such security remain in full force and effect until all amounts owed
to the PRODUCER by the assignee are satisfied and paid in full (or such
assignee establishes or reestablishes the lesser of (a) an investment grade
rating or (b) its credit rating at the time of the assignment); and
provided, however, that assignee may reduce the drawing amount under such
letter of credit from time to time provided such drawing amount is not less
than the aggregated amount of the obligations under this Agreement which
have been assigned and then remain; or (B) to an entity that does not have
an investment grade rating, provided that CUSTOMER's agreement with the
assignee requires that the assignee deliver, in a form reasonably
satisfactory to PRODUCER, an irrevocable, standby letter of credit issued
by a banking or other financial institution, the long-term unsecured debt
obligations of which is rated investment grade, with a drawing amount equal
to the obligations under this Agreement which have been assigned to the
assignee, and that such security remain in full force and effect until all
amounts owed to the PRODUCER by the assignee are
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satisfied and paid in full (or such assignee establishes an investment
grade rating); and provided, however, that assignee may reduce the drawing
amount under such letter of credit from time to time provided such drawing
amount is not less than the aggregated amount of the obligations under this
Agreement which have been assigned and then remain. PRODUCER shall not have
the right to assign this Agreement without CUSTOMER's prior written
consent, provided that PRODUCER or its permitted assignee, without
--------
CUSTOMER's consent, may assign, transfer, pledge or otherwise dispose of
(absolutely or as security) its rights and interests hereunder to an
Affiliate (an "Assignee Entity") of PRODUCER at least 68% of the equity
securities of which are owned by PRODUCER; provided, however, (i) any
-------- -------
minority owner of the Assignee Entity shall be that entity contemplated to
become an equity owner of PRODUCER's affiliated merchant energy group as
set forth in that certain press release issued by Constellation Energy
Group on October 23, 2000, (ii) no minority owner of the Assignee Entity
may have any control or management or operational rights or role with
respect to the Assignee Entity , and (iii) no such assignment shall relieve
or discharge PRODUCER from any of its obligations hereunder or shall be
made if it would reasonably be expected to prevent or materially impede,
interfere with or delay the transactions contemplated by this Agreement or
materially increase the costs of the transactions contemplated by this
Agreement. All assignments shall consist of the same proportion of
Installed Capacity and Energy. Except as provided above, any authorized
assignment shall relieve the assigning Party of any obligations or
liability under the Agreement to the extent of the assignment.
20. SIGNATORS' AUTHORITY/COUNTERPARTS. The undersigned certify that they are
authorized to execute this Agreement on behalf of their respective Party.
This Agreement may be executed in two or more counterparts, each of which
shall be an original. It shall not be necessary in making proof of the
contents of this Agreement to produce or account for more than one such
counterpart.
21. NO DEDICATION OF FACILITIES. No undertaking by PRODUCER or CUSTOMER under
any provision of this Agreement shall be deemed to constitute the
dedication of any portion of NMP-2 to the public, to CUSTOMER, or to any
other entity.
22. OPERATION OF NMP-2. PRODUCER at all times shall operate NMP-2 in accordance
with Good Utility Practice.
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IN WITNESS WHEREOF, and intending to be legally bound, the Parties have
executed this Agreement by the undersigned duly authorized representatives as of
the date first stated above.
PRODUCER CUSTOMER
By: By:
Name: Name:
Title: Title:
DATE: December 11, 2000
SCHEDULE A
"Contract Year Base Prices"
---------------------------
---------------------------
Contract Price
Year ($ per MWh)
---------------------------
1 $35.70
---------------------------
2 $35.32
---------------------------
3 $33.95
---------------------------
4 $33.60
---------------------------
5 $33.56
---------------------------
6 $33.23
---------------------------
7 $33.91
---------------------------
8 $34.61
---------------------------
9 $35.32
---------------------------
10 $36.05
---------------------------
SCHEDULE B
"Monthly Price Factors"
-----------------------
-------------------------------------------
Month On-Peak Off-Peak
-------------------------------------------
January 1.1865 0.6746
-------------------------------------------
February 1.1865 0.6746
-------------------------------------------
March 0.9492 0.6133
-------------------------------------------
April 0.9492 0.6133
-------------------------------------------
May 1.4238 0.7052
-------------------------------------------
June 1.6611 0.7359
-------------------------------------------
July 2.1357 0.7666
-------------------------------------------
August 2.1357 0.7666
-------------------------------------------
September 1.6611 0.7359
-------------------------------------------
October 0.9492 0.6133
-------------------------------------------
November 0.9492 0.6133
-------------------------------------------
December 1.1865 0.6746
-------------------------------------------
