Exhibit 10.21
AGREEMENT
THIS AGREEMENT ("AGREEMENT") is made and entered into, effective
February 16, 1999 ("EFFECTIVE DATE"), by and among Yalobusha County, Mississippi
("COUNTY") , acting by and through its Board of Supervisors ("BOARD") ; the
Coffeeville School District, acting by and through its Board of Trustees
("DISTRICT"); and LSP Energy Limited Partnership, a Delaware United partnership
("LSP").
INTRODUCTION
WHEREAS, LSP has proposed a project in the State of Mississippi
("STATE") to construct a new industrial enterprise, consisting of a natural gas
fueled electric power manufacturing facility for the manufacture, generation,
and production of electricity ("PROJECT"); and
WHEREAS, certain components of an industrial water supply system
(including, but not limited to, an intake structure, pumping station, a portion
of a pipeline to the Project, and a service road) for the Project will be
constructed on land owned by the United States of America and located at Xxxx
Reservoir in the County and District (collectively "FACILITIES"); and
WHEREAS, the Mississippi Department of Economic and Community
Development ("MDECD") and the Mississippi major Economic Impact Authority
("AUTHORITY"), which is a division of the MDECD, have engaged in extensive
discussions and negotiations with LSP regarding the location by LSP of the
Project in the State; and
WHEREAS, through such Project, LSP will be operating a new industrial
and manufacturing enterprise located in the State and will thus be making a
major contribution to the present and future economic development of the State
by the location of the Project in `.-he State; and
WHEREAS, as incentives for LSP to locate the Project in the State
rather than locating it in another State, certain inducements have been
negotiated by the MDECD, Authority, and LSP, including, but not limited to, the
commitment by the state to undertake to develop the Facilities by funding a
certain grant through the Authority under the Mississippi Major Economic Impact
Act, Sections 57-75-1 ET SEQ. of the Mississippi Code of 1972, as amended
("ACT"), for certain public infrastructure related to the Project (referred to
in Section 57-75-5(d) (Supp. 1998) of the Act as "facilities related to the
project"), of which the Facilities are a part thereof and a portion of which
will thus be located in the County and District ("GRANT"); and
WHEREAS, the County and the District are a "public agency" within the
meaning of Section 57-75-5(h) (Supp. 1998) of the Act, and the County, as the
"affected county," and the District, as the "affected school district," within
the meaning of Section 57-75-19 of the Act, must give their approval and
concurrence to the undertakings of the State and Authority with respect to the
development within the County and District, respectively, of the Facilities
using the Grant, as described herein and in the Act; and
WHEREAS, in consideration of such approval and concurrence by both the
County and the District, LSP proposes to make a certain lump-sum payment jointly
to the County and the District; and
WHEREAS, in order to assist in the promotion of the industrial and
economic development of the State, the County and District desire to approve and
concur in the development of the Facilities in the County and District,
respectively, and the undertakings of the Authority and the MDECD with respect
thereto, under and as authorized by the Act.
AGREEMENT
IN CONSIDERATION of the foregoing, the mutual covenants and agreements
contained herein, and other good and valuable consideration, each to the other
given, the receipt and sufficiency of all of which are both hereby expressly
acknowledged, the parties hereto, intending legally to be bound, do hereby
mutually agree as follows:
(1) LUMP-SUM PAYMENT. LSP hereby agrees to make a lump sum payment
jointly on behalf of the County and the District in an amount equal to one
Million Five Hundred Thousand and No/100 Dollars ($1,500,000.00) ("PAYMENT").
(2) TERM. The term of this Agreement shall commence on the Effective
Date and shall continue in full force and effect until terminated in accordance
with Section (4) below ("TERM").
(3) DUE DATE. The Payment shall be due, payable, and collectible, and
LSP shall make the Payment, on or before the first day of February immediately
following the Initial Year. The "INITIAL YEAR" shall be the calendar year in
which the First Lien Date occurs. The "FIRST LIEN DATE" shall, be the first
January 1st on or after the date when the Project is substantially complete (as
evidenced by a certificate of substantial completion issued by the independent
engineer retained by the lenders providing LSP's permanent, long-term financing
for the Project ("SUBSTANTIAL COMPLETION DATE") ; provided, however, that, if
such substantial Completion Date occurs after January 1st but before March 1st
of the calendar year, then the Project shall be deemed to have been completed,
and the First Lien Date shall occur, on January lot immediately preceding such
Substantial Completion Date.
(4) CREDITS. The Payment shall be a credit ("CREDIT") against the
amount, if any, of any ad valorem real and/or personal property taxes assessable
against and leviable on or with respect to, or which absent the Exemption would
have been so assessable against and leviable on or with respect to, the
assessable interest, if any, of LSP in the Facilities by or on behalf of the
county and/or the District during the Term ("TAXES"). Upon receipt of the
Payment, the portion thereof equal to any Taxes for the initial year shall be a
Credit against any Taxes for the Initial Year, and the balance of the Payment
shall be an advance payment or prepayment of any Taxes which are subsequently
assessable against and leviable on or with respect to, or which absent the
Exemption would have been so assessable against and leviable on or with respect
to, the assessable interest, if any, of LSP in the Facilities by or on behalf of
the County and/or the District for the balance of the Term ("PREPAYMENT"). The
Prepayment shall be a Credit against any liability of LSP for Taxes or for any
Taxes on the Facilities during the balance of the Term. On or before the due
date for the payment of any Taxes which are assessable against and leviable on
or with respect to, or which absent the Exemption would have been so assessable
against and leviable on or with respect to, the assessable interest, if any, of
LSP in the Facilities for any calendar year during the Term. The Board shall
annually adopt a resolution or order specifying
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that the amount of the remaining Prepayment equal to the amount of any such
Taxes so due and payable by LSP shall be a Credit to the account of LSP against
any such Taxes so due and payable by LSP ("ANNUAL ORDER"). The amount of the
Prepayment which is applied as a Credit against any Taxes each year during the
Term shall be subtracted from the remaining balance of the Prepayment, and ouch
annually recalculated balance of the prepayment shall be available in future
years until such Prepayment is exhausted through its application as Credits
against any Taxes. Upon exhaustion of the Prepayment through its application as
Credits against any Taxes, LSP shall then become liable for any additional Taxes
then accrued or thereafter accruing with respect to the Facilities, and this
Agreement shall then immediately terminate.
(5) ALLOCATION. The Payment to be made on the joint behalf of the
County and the District shall be payable by LSP to the- Clerk of the Board
("CLERK") for allocation between the County and the District pursuant to the
terms and provisions of an interlocal agreement to be entered into by and
between the County and District in accordance with applicable law.
Notwithstanding the terms and provisions, or the validity and legality, of such
interlocal agreement between the County and District, LSP's sole responsibility
for the Payment and for the payment of any Taxes during the Term is contained in
the Agreement, and the invalidity or illegality of such interlocal agreement, or
any provision thereof, shall not result in any additional liability to LSP for
any additional payments of any Taxes on the Facilities.
(6) APPROVAL AND CONCURRENCE. Each of the County and District, as a
"public agency" within the meaning of Section 57-75-5(h) (Supp. 1998) of the
Act, and as the "affected county" and "affected school district," respectively,
within the meaning of Section 57-75-19 of the Act, do hereby, pursuant to
Section 57-75-19 of the Act, approve and give their concurrence, to the extent
required by the Act, to the development of the Facilities in the County and
District, respectively, and to the undertakings of the Authority and the MDECD
in the development of the Facilities, under and pursuant to tile Grant and the
Act, as authorized by certain Resolutions of the Board of supervisors, of the
County and the Board of Trustees of the District, certified copies of which are
attached hereto, incorporated herein by reference, and expressly made a part
hereof for all purposes as if fully copied herein ("RESOLUTIONS").
(7) FURTHER ACTIONS. The County and District agree to forward or cause
to be forwarded to the MDECD and the Authority a certified copy of the
Resolutions and this executed Agreement, as well as to execute and deliver such
other documents and agreements, and to take such other additional and further
actions, as may reasonably be requested by the MDECD and/or the Authority in
order to effectuate the purposes and intent of, this Agreement and the
Resolutions.
(8) RECORDS. The Clerk shall maintain in his office a record of the
receipt of the Payment, the annual application of the applicable portion of the
remaining balance of the Prepayment as a Credit toward any Taxes, and the
balance of the Prepayment remaining from time to time and available as a Credit
against any future Taxes. As part of the Annual Order, the Board shall notify
the County Tax Collector of the annual application of the applicable portion of
the remaining balance Of the Prepayment as a Credit against any Taxes otherwise
due and owing by LSP and request the County Tax Collector to issue a receipt in
full for any and all Taxes due by LSP and so paid in advance of the due date
thereof by LSP through the Prepayment and the application of the applicable
portion thereof to any annual Taxes as a Credit with respect thereto;
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provided, however, that, with respect to the final application of the remaining
balance of the Prepayment as a credit against any annual Taxes which are not so
paid in full by such final Credit, the Tax Collector shall not issue such a
receipt until he receives the payment of the balance of such annual Taxes from
LSP.
(9) EXEMPTION. Upon the receipt from LSP of a timely and complete
application, the County does hereby declare its intention and agreement, to the
extent permissible and available under applicable law and subject to receipt of
any required approvals from the State Tax Commission, to grant a new enterprise
exemption from Taxes (excluding, however, any State or District Taxes where
required by State law to be so excluded) on any assessable interest of LSP in
the Facilities pursuant to Section 00-00-000 ET. SEQ. of the Mississippi Code
Annotated of 1972, as amended, commencing on the First Lien Date and continuing
in full force and effect f or the entire ten (10) year term allowed by law
("EXEMPTION").
(10) GRANT CONDITION. This entire Agreement is conditional upon use of
the Grant to construct the Facilities in the County and the District. If, for
any reason, the Grant is not so used to construct the Facilities in the County
and the District, then this Agreement shall be null and void and of no effect.
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EXECUTION
IN WITNESS WHEREOF, the undersigned individuals, acting in their
indicated official capacity, have executed this Agreement on behalf of and in
the name of the County, District, and LSP on the date set forth opposite their
respective names, having first been duly authorized by such entities so to do.
LSP: LSP ENERGY LIMITED PARTNERSHIP
By: LSP ENERGY, INC., General Partner
Date: February 16, 1999 By: /s/ Xxxxx X. Xxxxxxxxxxx
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Xxxxx X. Xxxxxxxxxxx
Its: Senior Vice President
COUNTY: YALOBUSHA COUNTY, MISSISSIPPI
By: BOARD OF SUPERVISORS
Date: January 15, 1999 By: /s/ X.X. Xxxxxxxx
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X.X. Xxxxxxxx, President
Date: January 15, 1999 By: /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, Clerk
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DISTRICT: COFFEEVILLE SCHOOL DISTRICT
Date: February 9, 1999 By: /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx Xxxx, President of the
Board of Trustees
Date: February 9, 1999 By: /s/ Xxxxxx Xxx
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Xxxxxx Xxx: Superintendent
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