EXHIBIT 10.70
INDEMNIFICATION AGREEMENT
This Indemnification Agreement is made and entered into on this 15/th/ day
of January 1999 by Dynegy Inc. ("Indemnifying Party") in favor of AGL Resources
Inc. ("AGLR"). AGLR's affiliate, Atlanta Gas Light Services, Inc., and the
Indemnifying Party's affiliate, Dynegy Hub Services, Inc. (the "Affiliate"), are
parties to that certain Limited Liability Company Agreement of SouthStar Energy
Services LLC dated July 1, 1998 ("LLC Agreement") as members of SouthStar Energy
Services LLC ("SouthStar"). Pursuant to that certain Guaranty Agreement (the
"Guaranty"), effective November 1, 1998, between AGLR and Atlanta Gas Light
Company, AGLR has agreed to guaranty SouthStar's obligations to Atlanta Gas
Light Company. AGLR's agreement with SouthStar to provide the Guaranty to
Atlanta Gas Light Company was subject to the condition that certain affiliates
of each member of SouthStar would indemnify AGLR against any losses AGLR incurs
as a result of AGLR providing financial support for SouthStar under the Guaranty
in accordance with the applicable SouthStar member's Allocable Share of Net
Profits and Losses, as set forth in the LLC Agreement. This Indemnification
Agreement sets forth the terms and conditions of that indemnification.
In consideration of the benefit the Indemnifying Party derives from AGLR
providing financial support to SouthStar pursuant to the Guaranty and the
benefit to AGLR of the Indemnifying Party indemnifying AGLR, the parties agree
as follows:
1. The Indemnifying Party shall indemnify, defend and hold AGLR harmless
against any losses, costs, fees, liabilities or other expenses AGLR incurs
as a result of AGLR's providing financial support for SouthStar under the
Guaranty ("Indemnified Expenses"). The Indemnifying Party shall be liable
for indemnifying AGLR hereunder for an amount equal to the product of the
Affiliate's Allocable Share (as set forth in the LLC Agreement or any
successor agreement) and the Indemnified Expenses. Notwithstanding any
statement herein to the contrary, the Indemnifying Party shall not be liable
to AGLR to the extent that the Indemnified Expenses resulted from AGLR's
gross negligence or willful misconduct.
2. AGLR shall invoice the Indemnifying Party (at the address set forth in
numbered paragraph 6 below) no later than ten days prior to the end of each
calendar month for the Indemnifying Party's share of the Indemnified
Expenses due from the previous calendar month or any portion thereof. The
Indemnifying Party shall pay AGLR the amount of such invoice (via wire
transfer to the account specified on the invoice) no later than the last day
of the calendar month during which AGLR sent the Indemnifying Party an
invoice.
If the Indemnifying Party fails to pay all of the amount of any invoice
when that amount becomes due, the Indemnifying Party shall pay AGLR a late
charge on the unpaid balance that shall accrue daily on each calendar day
from the due date at an annual rate equal to two percentage points above
the then-effective monthly prime commercial lending rate per annum
announced by NationsBank, N.A. from time to time multiplied by the unpaid
balance; provided, that for any period that such rate exceeds any
applicable maximum rate permitted by law, the rate shall equal the
applicable maximum rate.
3. This Indemnification Agreement shall inure to the benefit of each party, its
successors, assigns and creditors, and can be modified only by a written
instrument signed by the Indemnifying Party and AGLR. No Indemnifying Party
shall have the right to assign this Indemnification Agreement or its
obligations hereunder to any person or entity without the prior written
consent of AGLR, which shall not be unreasonably withheld.
4. This Indemnification Agreement shall be governed by, and construed in
accordance with the internal laws (but not the laws concerning conflicts of
laws) of the state of Georgia.
5. The Indemnifying Party represents and warrants to AGLR that it is authorized
to indemnify AGLR under the terms of this Indemnification Agreement, that it
has all of the rights and powers necessary to do so, and that the individual
signing below is authorized to bind the Indemnifying Party to its
obligations under this Indemnification Agreement.
6. Notices hereunder must be given in writing (which may be a facsimile
transmission) to be effective and shall be effective upon receipt by AGLR or
the Indemnifying Party at the address set forth below or at such other
address as AGLR or the Indemnifying Party may notify the other:
If to AGLR:
AGL Resources Inc.
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Indemnifying Party:
Dynegy Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
7. THE INDEMNIFYING PARTY HEREBY INTENTIONALLY AND VOLUNTARILY WAIVES ANY
DEFENSE TO PAYMENT UNDER THIS INDEMNIFICATION AGREEMENT THAT IS BASED UPON
OR ARISES OUT OF AGLR'S DIRECT OR INDIRECT OWNERSHIP OF AN EQUITY INTEREST
IN SOUTHSTAR AND/OR ATLANTA GAS LIGHT COMPANY.
AGREED TO AND ENTERED INTO the date first written above by:
AGL Resources Inc. Dynegy, Inc.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------- -----------------------------------
Title: Senior Vice President Title: Assistant Treasurer, Operations
----------------------- ---------------------------------
