Exhibit 4.13.2
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement") is entered into as of
March 11, 1997, by OGLETHORPE POWER CORPORATION (AN ELECTRIC MEMBERSHIP
GENERATION & TRANSMISSION CORPORATION) ("Oglethorpe") and GEORGIA TRANSMISSION
CORPORATION (AN ELECTRIC MEMBERSHIP CORPORATION) ("GTC") for the benefit of the
UNITED STATES OF AMERICA (the "Government) and certain other entities and
persons identified in Section 1 below.
WHEREAS, pursuant to that certain Second Amended and Restated
Restructuring Agreement, dated as of February 24, 1997, by and among Oglethorpe,
GTC and Georgia System Operations Corporation, as heretofore amended (the
"Restructuring Agreement"), Oglethorpe has on the date hereof, sold, transferred
and assigned the Transmission Assets (as defined in the Restructuring Agreement)
to GTC; and
WHEREAS, pursuant to Article II, Section 5(c)(bb) of the 1994 Mortgage
(defined below), the Government, acting through the Administrator (the
"Administrator") of the Rural Utilities Service (the "RUS"), and CoBank, ACB,
and SunTrust Bank, Atlanta, as trustee under certain pollution control bond
indentures (collectively, the "Other Mortgagees") this date released the
Transmission Assets from the lien of all mortgages made by Oglethorpe for the
benefit of the Government prior to September 1, 1994 (collectively, the
"Mortgages"); and
WHEREAS, pursuant to Article V, Section 8 of the Consolidated Mortgage and
Security Agreement, dated as of September 1, 1994, made by Oglethorpe for the
benefit of the Government and the Other Mortgagees (the "1994 Mortgage"),
Oglethorpe has agreed to indemnify the Government for any liability or damages
which it may incur or sustain in the exercise and performance of its powers and
duties under the 1994 Mortgage;
NOW, THEREFORE, in consideration of the approval by the Government, acting
through the Administrator of the RUS, of the transactions contemplated by the
Restructuring Agreement, the release of the Transmission Assets from the lien of
the Mortgages and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Oglethorpe and GTC hereby
undertake and agree as follows:
1. Subject to the provisions of Sections 3 and 4 of this Agreement,
Oglethorpe and GTC hereby agree to indemnify, defend and save harmless the
Government, the Administrator, the RUS, and any and all employees of the
Department of Agriculture (each an "Indemnified Party") from and against any and
all losses, claims, liabilities or other damages incurred as a result of any
claim or assertion against the Government by any of the Other Mortgagees, or the
holder of any bond or other
security directly or indirectly secured under the Mortgages, related to the
consent of the Government, acting through the Administrator of the RUS, to the
release of the Transmission Assets from the security title and lien of the
Mortgages (each such claim or assertion, an "Indemnified Claim"), including,
without limitation, (i) the execution and delivery by the Government of the "GTC
Release" and the "Assignment," as such terms are defined in that certain
Agreement Regarding Encumbrances, dated as of even date herewith, made by
Oglethorpe and GTC for the benefit of the Government, the Other Mortgagees and
others, and (ii) the execution and delivery by the Government of such Agreement
Regarding Encumbrances and any and all actions taken by the Government pursuant
thereto, and any and all actions, suits, proceedings, demands, assessments,
penalties, judgments, costs and legal and other expenses (including attorneys'
fees) incidental to any of the foregoing.
2. The indemnification and other obligations of Oglethorpe and GTC under
this Agreement are joint and several, absolute, unconditional and irrevocable.
3. Each Indemnified Party shall notify both Oglethorpe and GTC in writing
of an Indemnified Claim promptly upon becoming aware of the assertion of such
Indemnified Claim (each such notice, an "Indemnity Notice"). Oglethorpe and GTC
shall have no indemnification or other obligation under this Agreement with
respect to any Indemnified Claim if written notice thereof is not given to both
Oglethorpe and GTC within 180 days after an Indemnified Party has knowledge of
such Indemnified Claim.
4. Oglethorpe and GTC shall have thirty (30) days after receipt of any
notice given in accordance with Section 3 to undertake, conduct and control,
through counsel of their own choosing and at their expense, the settlement or
defense of any Indemnified Claim and the Indemnified Parties shall cooperate
with Oglethorpe and GTC in connection therewith. In connection with their
pursuit of such settlement or defense (i) neither Oglethorpe nor GTC shall
thereby permit to exist any lien, encumbrance or other adverse charge upon any
asset of any Indemnified Party and (ii) Oglethorpe and GTC shall permit the
Indemnified Parties to participate or consult with Oglethorpe and GTC and their
counsel in such settlement or defense through counsel chosen by the Indemnified
Parties, provided that the fees and expenses of such counsel shall be borne by
the Indemnified Parties. If Oglethorpe or GTC within thirty (30) days after
receipt of an Indemnity Notice undertakes the settlement or defense of an
Indemnified Claim, and at any time that either Oglethorpe or GTC is reasonably
pursuing a settlement or defense thereof in good faith, the Indemnified Parties
may settle such Indemnified Claim, provided that in such event the Indemnified
Parties shall waive any right to indemnity therefor by Oglethorpe and GTC and
any such settlement shall also provide for the release of Oglethorpe and GTC
from their liability, if any, with respect to such Indemnified Claim. If neither
Oglethorpe nor GTC within thirty (30) days after receipt of an Indemnity Notice
undertakes the settlement or defense of an Indemnified Claim, or if both
Oglethorpe and GTC at any time cease to reasonably pursue a settlement or
defense thereof in good faith, the Indemnified Party shall have the right to
settle or defend such Indemnified Claim in the exercise of its exclusive
discretion at the expense of Oglethorpe and GTC.
5. This Agreement shall be governed and construed in accordance with the
laws of the State of Georgia. The address for any notice required hereunder for
each party is:
Oglethorpe Power Corporation
0000 Xxxx Xxxxxxxx Xxxxx
Post Office Box 1349
Tucker, Georgia 30085-1349
Attn: President and Chief Executive Officer
Georgia Transmission Corporation
0000 Xxxx Xxxxxxxx Xxxxx
Post Office Box 1349
Tucker, Georgia 30085-1349
Attn: President and Chief Executive Officer
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first written above.
OGLETHORPE POWER CORPORATION
(AN ELECTRIC MEMBERSHIP
GENERATION & TRANSMISSION
CORPORATION)
By: /s/ J. Xxxxxx Xxxxxxx
---------------------------------
Chairman of the Board
GEORGIA TRANSMISSION CORPORATION
(AN ELECTRIC MEMBERSHIP
CORPORATION)
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Chairman of the Board
