Exhibit 2.1
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT is made effective September
10, 1998, between COGENERATION CORPORATION OF AMERICA or its
designee ("Purchaser") and MID-CONTINENT POWER COMPANY, L.L.C., a
Delaware limited liability company ("Seller").
W I T N E S S E T H :
WHEREAS, Seller owns all of the issued and outstanding stock
(the "Shares") of Oklahoma Loan Acquisition Corporation ("OLAC");
and
WHEREAS, Oklahoma Gas and Electric Company ("OG&E") and Mid-
Continent Power Company, Inc. ("MCPC") entered into a certain
Power Sales Agreement dated July 7, 1987 (the "OG&E Contract"),
which provides, among other things, for monthly fixed capacity
payments by OG&E of $641,666.66 per month commencing January 1998
(the "Fixed Monthly Capacity Payments"); and
WHEREAS, pursuant to a Second Amended Plan of Reorganization
(the "Plan") filed in the Bankruptcy Case of MCPC pending in the
United States Bankruptcy Court for the Northern District of
Oklahoma under the style: In re Mid-Continent Power Company,
Inc., an Oklahoma corporation, Case No. 97-02803-R (the
"Bankruptcy Case"), and the Order Confirming Debtor's Plan of
Reorganization entered on October 24, 1997 (the "Order"), MCPC
has transferred to OLAC MCPC's co-generation plant located in the
Mid-America Industrial Park, Pryor, Oklahoma, and all of MCPC's
real property, improvements, buildings, fixtures, equipment,
supplies, proceeds and all other assets of MCPC (collectively,
the "Plant"); and
WHEREAS, the OG&E Contract was assumed by MCPC in the
Bankruptcy Case and was assigned to OLAC pursuant to the Plan and
the Order; and
WHEREAS, Purchaser desires to purchase from Seller all of
the Shares subject to the terms and conditions of this Agreement;
NOW THEREFORE, in consideration of the recitals, Ten Dollars
($10.00) and other good and valuable consideration, the receipt
of which is hereby acknowledged, it is agreed as follows:
1. Purchase of Shares. Subject to the terms and conditions
contained in this Agreement, Seller agrees to sell, transfer and
deliver or cause to be delivered the Shares to Purchaser for a
total purchase price of Twenty-Five Million Three Hundred Fifty
Thousand and no/100 Dollars ($25,350,000.00) (the "Purchase
Price") payable as follows:
1. 1 Xxxxxxx Money Deposit. Contemporaneously with the
execution hereof, the Purchaser shall deliver to Seller a
$2,500,000.00 xxxxxxx money deposit in current funds (the
"Xxxxxxx Money Deposit") to be applied to the Purchase Price on
the Closing Date
(as hereafter defined), unless otherwise applied pursuant to
the provisions hereof if closing does not occur.
1. 2 Cash. At Closing, Purchaser shall deliver to Seller
current funds in an amount equal to (a) Twenty-Two Million Eight
Hundred Fifty Thousand Dollars ($22,850,000.00) minus (b) an
amount equal to $130,000.00 per month from December 31,1997 until
the Closing Date up to a maximum of $780,000.00, prorated for
partial months (the "Purchase Price Rebate"), provided that the
Purchase Price Rebate will apply only if all Fixed Monthly
Capacity Payments have been paid in full when due on or before
the Closing Date, plus (c) OLAC's accrued but uncollected
accounts receivable as of the Closing Date excluding only (i)
accounts receivable which are more than 90 days past due,
including but not limited to the approximate $2,700,000.00
account receivable owing by Georgia Pacific, (ii) all receivables
from affiliated parties and (iii) bad debts on the books of OLAC
as of the Closing Date, plus (d) the amount of any cash or cash
equivalents held by OLAC on the Closing Date but only to the
extent, if any, such cash and cash equivalents exceed the Net
Reserves as determined in accordance with Section 3.7 hereof,
plus (e) the amount of any deposits or prepayments made by OLAC
to any of its creditors or vendors in the ordinary course of
business, minus (f) OLAC's accrued but unpaid accounts payable as
of the Closing Date. In addition, an adjustment will be made to
the Purchase Price at Closing to pro rate real estate taxes, and
water and sewer services, and as provided in Section 3.7.
2. Representations and Warranties of Seller. Seller represents
and warrants to Purchaser as follows as of the date of execution
of this Agreement (the "Effective Date") and as of the Closing
Date, each of which representations and warranties shall survive
the Closing Date for one year at which time all such
representations and warranties will terminate, except for the
representations and warranties contained in Section 2.4 hereof
which shall survive the Closing forever; and Seller will
indemnify and hold Purchaser harmless from any loss including
reasonable attorneys fees arising from a breach of any of the
following representations and warranties if Purchaser asserts a
claim in writing for such breach within such one year period of
time (except with respect to a claim in writing for a breach of
Section 2.4 which can be asserted at any time after Closing
without time restriction) but only if such claim is ultimately
established as a valid claim by a court of competent
jurisdiction:
2.1 Organization, Standing and Qualification of OLAC. OLAC is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and qualified as a
foreign corporation in the State of Oklahoma; it has all
requisite power and authority and is entitled to carry on its
business as it is now being conducted and as proposed to be
conducted after the effective date of the Plan and to own, lease
or operate its properties as and in the places where such
business is now conducted and as proposed to be conducted after
the effective date of the Plan; and OLAC is not required to be
qualified, licensed or domesticated as a foreign corporation in
any other jurisdiction.
2.2 Organization, Standing and Qualification of Seller. Seller
is a limited liability company in good standing under the laws of
the State of Delaware; it has all requisite power and authority
and is entitled to carry on its business as it is now being
conducted and to own, lease or operate its properties as and in
the places
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where such business is now conducted. By the Closing
Date, Seller will be qualified to do business as a
limited liability company in the State of Oklahoma and
is not required to be qualified, licensed or
domesticated as a foreign limited liability company in
any other jurisdiction.
2.3 Execution, Delivery and Performance of Agreement; Authority.
Assuming the filings required under the Xxxx-Xxxxx-Xxxxxx Act are
timely made and the conditions set forth in subsections 9.5,
10.5, 10.6 and 10.7 are satisfied, neither the execution,
delivery nor performance of this Agreement by Seller, with or
without the giving of notice or the passage of time, or both,
conflicts with, results in a default, right to accelerate or loss
of rights under, or results in the creation of any lien, charge
or encumbrance pursuant to, any provision of the formation
documents of Seller or OLAC or any franchise, mortgage, deed of
trust, lease, license, easement, agreement, understanding, law,
rule or regulation or other order, judgment or decree to which
Seller or OLAC is a party or by which Seller or OLAC or their
respective properties may be bound or affected. Seller has the
necessary corporate power and authority to enter into this
Agreement and to carry out the transactions contemplated by this
Agreement, and this Agreement constitutes a valid and binding
obligation of Seller, enforceable in accordance with its terms
except to the extent that enforcement thereof may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws of general application
relating to or affecting the enforcement of the rights of
creditors or the application of general principles of equity.
2.4 Capitalization of OLAC. The aggregate number of shares
which OLAC is authorized to issue is 1,000 common shares, of
which 1,000 are issued and presently outstanding, and all of
which are held by Seller, free and clear of any liens and
encumbrances.
2.5 "Qualifying Facility" Status . As of the effective date of
the Plan and through the Closing Date, the Plant will be a
"qualifying facility" under the Public Utility Regulatory
Policies Act ("PURPA").
2.6 DISCLAIMER. SELLER DISCLAIMS ANY, AND MAKES NO,
REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, AND
WHETHER BY COMMON LAW, STATUTE OR OTHERWISE, AS TO THE FOLLOWING:
(a) (I) THE QUALITY, CONDITION OR
OPERABILITY OF ANY REAL OR PERSONAL PROPERTY OR
EQUIPMENT AT THE PLANT, OR (II) ITS
MERCHANTABILITY, OR (III) ITS FITNESS FOR ANY
PARTICULAR PURPOSE OR (IV) ITS CONFORMITY TO
MODELS OR SAMPLES OF MATERIALS, AND ALL PERSONAL
PROPERTY AND EQUIPMENT AT THE PLANT IS DELIVERED
"AS IS, WHERE IS" IN THE CONDITION IN WHICH THE
SAME EXISTS;
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(b) THE ENVIRONMENTAL CONDITION OF THE
PLANT; OR
(c) THE STATUS, VALIDITY OR ENFORCEABILITY
OF THE OG&E CONTRACT.
2.7 Liabilities of OLAC. Except for (a) certain indebtedness
owing to NRG Energy, Inc. ("NRG") by OLAC, and (b) certain
contractual obligations reflected on Exhibit "A" hereto attached
as a part hereof, as of the date hereof, OLAC has no liabilities
of any nature, including contingent liabilities, owing to any
other party.
2.8 Seller has not been and is not a "holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as
amended ("PUHCA"). Seller is a "subsidiary company" of a
"holding company" within the meaning of PUHCA, which holding
company is exempt from registration and from any obligation, duty
or liability under PUHCA as a "holding company" within the
meaning of PUHCA.
2.9 Tax Basis. The adjusted basis of the Plant for federal
income tax purposes shall be at least $15,000.000.
3. Covenants of Seller. Seller agrees with Purchaser as
follows:
3.1 [intentionally omitted]
3.2 Until the Closing Date, Seller will cause OLAC to own and
operate the Plant, and from the date hereof until the Closing
Date Seller will not permit OLAC to enter into any contracts
other than contracts that (a) are approved by Purchaser, (b)
involve purchases of natural gas or electricity transmission
services for the Plant for a period less than or equal to six
months, or (c) have a financial impact on OLAC of less than
$25,000 with respect to any single contract.
3.3 Seller will not permit OLAC to authorize or issue any
additional OLAC securities prior to the Closing Date, and Seller
shall not encumber the Shares.
3.4 From the date hereof through the Closing Date, Seller shall
cause OLAC to operate the Plant only in the ordinary course of
business and neither Seller nor OLAC will take any action
inconsistent with this Agreement or with the consummation of the
Closing. Without limiting the generality of the foregoing,
except as specifically contemplated by this Agreement or
consented to in writing by Purchaser, Seller will not permit OLAC
to:
(a) sell, assign, transfer, convey, lease, mortgage, pledge or
otherwise dispose of or encumber any of the assets of OLAC, or
any interests therein, except in the ordinary course of business;
(b) merge or consolidate with, or acquire (except in the
ordinary course) any of the assets of, any other corporation,
business or person;
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(c) fail to maintain adequate insurance at the same levels as in
effect as of the effective date of the Plan or as required by the
OG&E Contract;
(d) except for any violations of law in effect with respect to
the ownership and operation of the Plant as of the date of the
transfer of the Plant to OLAC, fail to comply with any
applicable laws or maintain all required governmental permits;
which failure could reasonably be expected to have a material
adverse effect on the Plant or the operations of OLAC;
(e) fail to maintain its assets in substantially their current
state of repair, excepting normal wear and tear;
(f) make any loans or advances;
(g) do any other act which would cause any representation or
warranty of Seller in this Agreement to be or become untrue in
any material respect;
(h) except for the Mid-Continent Power Company, Inc, 401K
Retirement Plan, maintain an Employee Pension Benefit Plan or an
Employee Welfare Benefit Plan (as each is defined under the
Employee Retirement Income Security Act of 1974, as amended);
(i) enter into any agreement, or otherwise become obligated, to
do any action prohibited hereunder; or
(j) except as permitted in Section 3.2 hereof, incur any
liabilities of any nature whatsoever, including contingent
liabilities, that in the aggregate exceed or may exceed $50,000.
3.5 As promptly as possible after the Effective Date, Seller
will make or cause to be made all filings required to be made by
Seller or OLAC in order to consummate this Agreement, including
all filings under the Xxxx-Xxxxx-Xxxxxx Act. Between the
Effective Date and the Closing Date, Seller will (a) cooperate
with Purchaser with respect to all filings that Purchaser elects
to make or is required to make in connection with this Agreement,
and (b) cooperate with Purchaser in obtaining all consents
necessary to consummate this Agreement.
3.6 Between the Effective Date and the Closing Date Seller will
use commercially reasonable efforts to cause the conditions in
Sections 9 and 10 to be satisfied.
3.7 Between the Effective Date and the Closing Date, Seller
shall cause OLAC to perform all normal and scheduled maintenance
per industry standards on the Plant's equipment. With respect to
expenses for all third party parts, labor and equipment for the
regularly scheduled GE Frame 6 outage (the "Outage Expenses"),
Seller will cause OLAC to maintain an overhaul reserve of
$50,000.00 per month (with a maximum amount of $300,000.00) and
an additional overhaul reserve of $21,667.00 per month until the
Closing Date (the
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"Reserves"), provided that the amount of such reserves
will be reduced by all actual documented Outage
Expenses paid by OLAC or MCPC on or before the Closing
Date (the "OLAC Expenses") (the Reserves less the OLAC
Expenses are referred to herein as the "Net Reserves").
To the extent OLAC does not have the Net Reserves in
cash or cash equivalents on the Closing Date, such
deficiency will be reduced from the Purchase Price.
3.8 Between the Effective Date and the Closing Date, Seller
shall cause OLAC to enter into agreements with Aquila Power
Corporation ("APC") and Aquila Energy Marketing Corporation
("AEMC") for certain electricity transmission and natural gas
procurement services.
3.9 [intentionally omitted]
3.10 [intentionally omitted]
3.11 Seller shall be liable for and shall pay, and hereby
indemnifies Purchaser for, all taxes, including penalties and
interest with respect thereto, of OLAC (including, but not
limited to, any amounts due from OLAC under any tax sharing or
similar agreement or any liability arising under Treasury
Regulation 1.1502-6), whenever assessed, that are attributable to
all taxable years or periods ending on or before the Closing Date
and, with respect to any taxable years or periods that begin
before the Closing and end after the Closing, the portion of such
taxable years or periods ending at the Closing. Seller shall
prepare or cause to be prepared in a manner consistent with past
custom and practice (unless otherwise required to comply with
applicable law) and timely file or cause to be filed with the
appropriate taxing authorities all tax returns of OLAC required
to be filed for all taxable years or periods ending on or before
the Closing Date. Seller shall permit Purchaser to review and
comment upon each such tax return described in the preceding
sentence (including any amended tax returns) prior to filing.
Purchaser shall prepare or cause to be prepared in a manner
consistent with Seller's past custom and practice (unless
otherwise required to comply with applicable law) and timely file
or cause to be filed with the appropriate taxing authorities all
tax returns of OLAC required to be filed for all taxable years or
periods which begin prior to the Closing Date and end after the
Closing Date. Purchaser shall permit Seller to review and
comment upon each such tax return described in the preceding
sentence (including any amended returns) prior to filing.
Purchaser shall not file any amended return for OLAC for a period
ending on or prior to the Closing Date without the prior consent
and approval of Seller, which consent and approval will not be
unreasonably withheld. Notwithstanding anything contained in
this Agreement to the contrary, claims for indemnification
relating to taxes may be made by Purchaser until 90 days after
the expiration of the applicable statute of limitations for any
third party to bring any claim related to taxes against OLAC.
4. Representations and Warranties of Purchaser. Purchaser
hereby represents and warrants to Seller as follows as of the
Effective Date, each of which representations and warranties
shall survive the Closing Date for one year at which time all
such representations and warranties will terminate; and Purchaser
will indemnify and hold Seller harmless from any loss arising
from a
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breach of any of the following representations and warranties if
Seller asserts a claim in writing for such breach within such one
year period of time but only if such claim is ultimately
established as a valid claim by a court of competent
jurisdiction:
4.1 Organization, Standing and Qualification of Purchaser.
Purchaser is a corporation in good standing under the laws of the
State of Delaware; Purchaser has all requisite power and
authority and is entitled to carry on its business as it is now
being conducted and to own, lease or operate its properties as
and in the places where such business is now conducted.
4.2 Execution, Delivery and Performance of Agreement; Authority.
Assuming the filings required under the Xxxx-Xxxxx-Xxxxxx Act are
timely made and the conditions set forth in subsections 9.5,
10.5, 10.6 and 10.7 are satisfied, neither the execution,
delivery nor performance of this Agreement by Purchaser, with or
without the giving of notice or the passage of time, or both,
conflicts with, results in a default, right to accelerate or loss
of rights under, or results in the creation of any lien, charge
or encumbrance pursuant to, any provision of the Articles of
Incorporation or Bylaws of Purchaser or any franchise, mortgage,
deed of trust, lease, license, easement, agreement,
understanding, law, rule or regulation or any order, judgment or
decree to which Purchaser is a party or by which Purchaser or its
properties may be bound or affected. Purchaser has the necessary
corporate power and authority to enter into this Agreement and to
carry out the transactions contemplated by this Agreement, and
this Agreement constitutes a valid and binding obligation of
Purchaser, enforceable in accordance with its terms except to the
extent that enforcement thereof may be limited by applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar laws of general application relating to or
affecting the enforcement of the rights of creditors and the
application of general principles of equity.
4.3 No regulatory approvals for the transaction contemplated
hereby are required other than the expiration or termination of
all applicable waiting periods under the Xxxx-Xxxxx-Xxxxxx Act.
4.4 Purchaser represents and warrants that it is acquiring the
Shares hereunder for its own account for investment purposes
only, and not with a view to, or for sale or other disposition in
connection with, any distribution thereof, nor with any present
intention of selling or otherwise disposing of the same.
Purchaser represents, warrants and acknowledges that it is an
Accredited Investor (as that term is defined in Rule 501
promulgated by the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "Securities Act")).
Purchaser acknowledges that the sale of Shares to it is not being
registered under the Securities Act or under the securities or
blue sky laws of any state or foreign jurisdiction; that such
Shares must be held indefinitely unless subsequently registered
under the Securities Act and any applicable state securities or
blue sky laws, or unless an exemption from registration is
available thereunder.
4.5 [intentionally omitted]
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4.6 [intentionally omitted]
4.7 Purchaser has the present intent to own and operate the
Plant after the Closing Date as an ongoing business.
5. Purchaser's Covenants. Purchaser agrees with Seller as
follows:
5.1 [intentionally omitted]
5.2 [intentionally omitted]
5.3 Purchaser shall indemnify and hold Seller and all of
Seller's employees, agents, attorneys, consultants and
representatives and all of their heirs, personal representatives,
successors and assigns harmless from all loss, liability, claims,
damages, costs and expenses (collectively referred to herein as
"Losses") arising from events occurring after the Closing Date in
connection with any and all contracts which (a) were assumed by
MCPC in the Bankruptcy Case and assigned to OLAC pursuant to the
Plan and the Order, (b) were entered into by OLAC in accordance
with Section 3.2 or otherwise with the consent of Purchaser, or
(c) are set forth in Exhibit "A" hereto; provided, however, that
the foregoing indemnity shall not apply to Losses arising as a
result of a breach by Seller of any representation, warranty or
covenant contained herein.
5.4 As promptly as possible after the Effective Date, Purchaser
will make all filings required to be made by it or any of its
affiliates in order to consummate this Agreement, including all
filings under the Xxxx-Xxxxx-Xxxxxx Act and all filings necessary
to obtain the other approvals described in Section 4.3. Between
the Effective Date and the Closing Date, Purchaser will (a)
cooperate with Seller with respect to all filings that Seller
elects to make or is required to make in connection with this
Agreement, and (b) cooperate with Seller in obtaining all
consents necessary to consummate this Agreement.
5.5 Between the Effective Date and the Closing Date Purchaser
will use commercially reasonable efforts to cause the conditions
in Section 9 and 10 to be satisfied.
5.6 [intentionally omitted]
6. Xxxxx Agreements. The Seller will exercise reasonable
commercial efforts to terminate or cause the termination of the
Employment Agreement dated September 26, 1996 between Xxxxxxx X.
Xxxxx and MCPC (the "Employment Agreement") and the Restructuring
Agreement between OLAC and Xxxxxxx X. Xxxxx dated September 26,
1996 (the "Restructuring Agreement"). If the Seller is unable to
cause the termination of the Restructuring Agreement on or before
the Closing Date, Seller will indemnify Purchaser and OLAC from
all liability, loss, claims, damages and expenses arising out of
the Restructuring Agreement. If Seller is unable to cause the
termination of the Employment Agreement on or before the Closing
Date, Purchaser agrees to cause OLAC to perform its obligations
under the Employment Agreement, and Seller will indemnify and
hold Purchaser harmless for all salary and incentive payments
duly made by
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Purchaser or OLAC to Xxxxxxx X. Xxxxx in accordance with the
terms of the Employment Agreement; provided that Seller will not
indemnify and hold Purchaser harmless from (i) any amounts
payable under Section 13(v) of the Employment Agreement, except
to the extent such amounts are attributable to the October 1,
1997 Process Steam Sales Agreement with G-P Gypsum Corporation;
or (ii) any amounts payable under Section 13(vi) of the
Employment Agreement on account of any increases in the Plant's
consumption of natural gas due to changes in the Plant's capacity
or equipment. All payments made by Seller pursuant hereto will
be based on annual certificates provided by Purchaser to Seller
specifying in detail the computation of the foregoing amounts.
7. Conditions of Indemnification. With respect to any actual
or potential claim, any written demand, the commencement of any
action, or the occurrence of any other event which involves any
matter or related series of matters (a "Claim") against which a
party hereto is indemnified (the "Indemnified Party") by the
other party hereto (the "Indemnifying Party") under Section 2,
3.11, 4, 5 or 6 hereof:
7.1 Promptly after the Indemnified Party either receives written
documents pertaining to the Claim, or first has actual knowledge
of such Claim, the Indemnified Party shall give notice to the
Indemnifying Party of such Claim in reasonable detail and stating
the amount involved, if known, together with copies of any such
written documents.
7.2 If the Claim involves a Claim asserted by a third party (a
"Third Party Claim"), then the Indemnifying Party shall at its
sole cost, expense and ultimate liability regardless of the
outcome, and through counsel of its choice (which counsel shall
be reasonably satisfactory to the Indemnified Party), litigate,
defend, settle or otherwise attempt to resolve such Third Party
Claim; provided, however, that if in the Indemnified Party's
reasonable judgment a conflict of interest may exist between the
Indemnified Party and the Indemnifying Party with respect to such
Third Party Claim, then the Indemnified Party shall be entitled
to select legal counsel of its own choosing, reasonably
satisfactory to the Indemnifying Party, in which event the
Indemnifying Party shall be obligated to pay the fees and
expenses of such legal counsel. If the Indemnifying Party fails
or refuses to provide a defense to any Third Party Claim, then
the Indemnified Party shall have the right to undertake the
defense, compromise or settle such Third Party Claim, through
legal counsel of its choice, on behalf of and for the account and
at the risk of the Indemnifying Party, and the Indemnifying Party
shall be obligated to pay the costs, expenses and attorney's fees
incurred by the Indemnified Party in connection with such Third
Party Claim. In any event, Purchaser and Seller shall fully
cooperate with each other and their respective counsel in
connection with any such litigation, defense, settlement or other
attempted resolution.
8. Inspection Period. Purchaser or Purchaser's designated
agents and employees shall have the right, at all reasonable
hours agreed to by Seller, to inspect and examine until September
14, 1998, the environmental condition of the Plant and the
associated real property (the "Environmental Conditions").
Seller and OLAC will cooperate with Purchaser in connection with
such inspection and examination. If Purchaser shall not be
satisfied with the Environmental Conditions after such inspection
and examination, then Purchaser may terminate this Agreement
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by giving Seller written notice on or before September 14, 1998
in which case Seller will return the Xxxxxxx Money Deposit to
Purchaser. If the Seller has not received such written
notification on or before September 14, 1998, the Purchaser will
be deemed to be satisfied with the Environmental Conditions and
to have waived the Purchaser's right to terminate this Agreement
pursuant to the provisions of this paragraph 8, and all of the
terms of this Agreement will remain in full force and effect.
After September 10, 1998 and prior to the Closing Date, Seller
will provide Purchaser with reasonable access to the Plant to the
extent useful to Purchaser in connection with Purchaser's future
operation of the Plant.
9. Conditions Precedent to Seller's Obligations. Unless waived
by the Seller, the failure of any of the following conditions
precedent to occur or be performed as of the Closing Date shall
excuse performance by the Seller of the terms of this Agreement,
in which case this Agreement may be terminated by the Seller and
the Xxxxxxx Money Deposit will be returned to Purchaser.
9.1 All representations and warranties of Purchaser contained in
this Agreement shall be true and correct in all material respects
at and as of the date of this Agreement and at and as of the
Closing Date, and Purchaser shall have performed and satisfied
all agreements and covenants required hereby to be performed by
Purchaser prior to or on the Closing Date. Purchaser shall have
delivered to Seller a certificate dated the Closing Date to such
effect.
9.2 No action by any governmental authority or other person
shall have been instituted or threatened which questions the
validity or legality of the transactions contemplated hereby.
9.3 [intentionally omitted]
9.4 [intentionally omitted]
9.5 All applicable waiting periods (and any extensions thereof)
under the Xxxx-Xxxxx-Xxxxxx Act shall have expired or otherwise
been terminated and the parties shall have received all other
authorizations, consents and approvals of governments and
governmental agencies referred to in Section 4.3.
9.6 Purchaser shall have obtained releases in favor of Seller
and NRG from all obligations of Seller or NRG which are in the
nature of guaranties or letters of credit for the benefit or
support of OLAC, all as reflected on Exhibit "A" hereto, or
Purchaser shall have made arrangements reasonably satisfactory to
Seller to indemnify, defend and hold Seller harmless from such
obligations.
10. Conditions Precedent to Purchaser's Obligations. Unless
waived by Purchaser, the failure of any of the following
conditions precedent to occur or be performed as of the Closing
Date shall excuse performance by the Purchaser of the terms of
this Agreement in which case this Agreement may be terminated by
Purchaser and the Xxxxxxx Money Deposit will be returned to
Purchaser.
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10.1 All representations and warranties of Seller contained in
this Agreement shall be true and correct in all material respects
at and as of the date of this Agreement and at and as of the
Closing Date, and Seller shall have performed and satisfied all
agreements and covenants required hereby to be performed by it
prior to or on the Closing Date. Seller shall have delivered to
Purchaser a certificate dated the Closing Date to such effect.
10.2 No action by any governmental authority or other person
shall have been instituted or threatened which questions the
validity or legality of the transactions contemplated hereby or
which could reasonably be expected to have a material adverse
effect upon the assets of OLAC if the transactions contemplated
hereby are consummated.
10.3 Between the date hereof and the Closing Date, there shall
not have been any material adverse change in the mechanical
equipment located at the Plant (the "Equipment"), the contractual
relations or liabilities (except as agreed to by Purchaser) of
OLAC, or the Environmental Conditions.
10.4 [intentionally omitted]
10.5 [intentionally omitted]
10.6 [intentionally omitted]
10.7 All applicable waiting periods (and any extensions thereof)
under the Xxxx-Xxxxx-Xxxxxx Act shall have expired or otherwise
been terminated and the parties shall have received all other
authorizations, consents and approvals of governments and
governmental agencies referred to in Section 4.3.
10.8 OLAC shall have amended its by-laws to provide that a
special meeting of the shareholders may be called by holders of
20% or more of the outstanding shares of the corporation and each
director of OLAC shall have delivered to Purchaser a written
resignation to be effective at Closing.
10.9 All contracts between OLAC and NRG or Seller or any
affiliates thereof shall have been terminated.
10.10 All indebtedness owing by OLAC to Seller or NRG or any
of their affiliates shall have been paid on or prior to the
Closing Date.
10.11 Until transfer of the Plant to OLAC, MCPC shall not
have taken any action that had it been taken by OLAC would have
been prohibited under this Agreement.
10.12 [intentionally omitted]
10.13 [intentionally omitted]
11
11. Closing. The closing of the transactions contemplated herein
(the "Closing") shall take place on the third business day after
all of the conditions set forth in Sections 9 and 10 are
satisfied or waived or at such other time as the parties hereto
may mutually determine (the "Closing Date").
11.1 Seller's Deliveries. At the Closing Seller shall deliver to
Purchaser the Shares, properly endorsed, the Certificate
described in Section 10.1, the resignations described in Section
10.8, and a certificate confirming that all conditions set forth
in Section 9 have either been waived or satisfied.
11.2 Purchaser's Deliveries. At the Closing Purchaser will pay
the amount set forth in Section 1.2, Purchaser shall deliver the
certificate described in Section 9.1, and Purchaser shall deliver
a certificate confirming that all conditions set forth in Section
10 have either been waived or satisfied.
11.3 Dismissals. [intentionally omitted]
11.4 Insurance. Purchaser acknowledges and agrees that Seller
shall have no obligation to maintain any insurance with respect
to OLAC, the Plant or any of OLAC's assets from and after the
Closing Date.
12. Remedies. If there is a material misrepresentation, a
material breach of warranty or a material breach of a covenant by
either of the parties hereto and if such misrepresentation or
breach has not been cured within ten (10) days after written
notice thereof has been given to the other party, such occurrence
will constitute a default hereunder (a "Default"). The Purchaser
and the Seller acknowledge and agree that if the Purchaser
Defaults by virtue of a failure to close for any reason other
than the failure of the conditions set forth at Sections 8 or 10
hereof (the "Closing Default"), Seller's damages would be
impracticable, extremely difficult, or impossible, to determine,
and the full amount of the Xxxxxxx Money Deposit represents a
reasonable estimate of such damages and will be retained by the
Seller as liquidated damages, and Seller will have no further
remedies against Purchaser under this Agreement. If Purchaser
fails to close due to the failure of any of the conditions set
forth at Sections 8 or 10 of this Agreement, this Agreement may
be terminated by the Seller and the Xxxxxxx Money Deposit will be
returned to Purchaser. If Seller or Purchaser Defaults on or
before the Closing Date (other than a Closing Default), the non-
defaulting party will be entitled to exercise all remedies
available at law or in equity except for specific performance in
a case where specific performance would be inconsistent with a
claim asserted by a third party, including but not limited to the
termination rights set forth herein and at Section 12.1 hereof,
provided that neither of the parties hereto will be entitled to
assert a claim against a Defaulting party for any consequential
or punitive damages, lost profits (other than actual damages) or
loss of goodwill (other than actual damages). If Seller Defaults
after the Closing Date, the Purchaser will be entitled to
exercise all remedies available under law or in equity subject
only to specific remedies granted hereunder for specific
Defaults, provided that neither of the parties hereto will be
entitled to assert a claim against a Defaulting party for any
consequential or punitive damages, or lost profits (other than
actual damages) or loss of goodwill (other than actual damages).
12.1 Termination. At any time before the Closing, this Agreement
may be terminated (a) by mutual consent of the parties, (b)
subject to the provisions of Section 12
12
hereof, by either Purchaser or Seller if there has been
a Default hereunder by the other party; or (c) subject
to the provisions of Section 12 hereof, by either party
if the Closing does not occur on or before October 15,
1998, unless extended by mutual agreement of the
parties, (d) by Purchaser if any of the conditions in
Section 10 has not been satisfied as of the Closing
Date or if satisfaction of such a condition is or
becomes impossible (other than through the failure of
Purchaser to comply with its obligations under this
Agreement), and Purchaser has not waived such condition
on or before the Closing Date, (e) by Seller if any of
the conditions in Section 9 has not been satisfied as
of the Closing Date or if satisfaction of such a
condition is or becomes impossible (other than through
the failure of Seller to comply with its obligations
under this Agreement), and Seller has not waived such
condition on or before the Closing Date.
12.2 Effect of Termination. Termination of this Agreement shall
release each party hereto from any further obligations hereunder
but shall not relieve a party from liability for the breach by
such party of any of its representations, warranties, covenants
or agreements contained in this Agreement, and on such
termination the parties hereto will be entitled to exercise their
remedies set forth at Sections 12 and 12.1 hereof.
13. Notice. Any notices required or permitted hereunder or
which any party elects to give shall be in writing and delivered
either personally to the other party and the other party's
authorized agent set forth below (or as changed by written
notice), or by depositing such notice in the United States Mail,
certified, return receipt requested, postage fully prepaid, to
the person at the address set forth below or to such other
address as any party may later designate in writing, or by
sending such notice by facsimile transmission to the fax numbers
set forth below:
To Seller: NRG Energy, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx
Fax No. (000) 000-0000
To Purchaser: Cogeneration Corporation of America
Xxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx, Xx.
Fax No. (000) 000-0000
with a copy to:
Cogeneration Corporation of America
c/o Xxxxxx X. Xxxxxxx, Xx.
Chairman - Independent Committee
S 3 Capital LLC
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000-0000
Fax No. (000) 000-0000
13
Any notice required hereunder shall be deemed delivered at such
time as it is received by the party being notified if notice is
by personal delivery, or three (3) days after such notice is
deposited in the United States Mail if by postal delivery, or on
the date a facsimile transmission is sent and confirmed as
received.
14. Miscellaneous Provisions.
14.1 Each party hereto represents to the other that it has dealt
with no finder or broker with respect to this transaction, and
each party hereto agrees to indemnify the other party hereto
against any claim by any third party for any brokerage commission
or finders fee based on any alleged agreement between such party
and such third person, whether express or implied by the actions
of such party.
14.2 This Agreement shall be binding on, and shall inure to the
benefit of the parties hereto, and their respective successors
and assigns.
14.3 This Agreement, and all Exhibits hereto, constitute the
entire agreement of the parties hereto with respect to the
subject matter hereof, and supersede and replace all prior
representations, warranties, promises, terms, conditions,
agreements, and negotiations whatsoever referring to the subject
matter hereof. No modification, change or alteration of this
Agreement or any of the documents in the forms appearing at the
Exhibits hereto shall be of any legal force or effect whatsoever,
unless in writing, signed by all the parties hereto.
14.4 The paragraph headings herein are inserted for convenience
only and shall in no way define, limit or describe the scope or
intent of any provision of this Agreement.
14.5 This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original instrument, but all of
which taken together will constitute only one Agreement.
14.6 No waiver of any breach of any one of the terms, conditions,
or covenants of this Agreement by any party shall be deemed to
imply or constitute a waiver of any other term, condition or
covenant of this Agreement. The failure of any party to insist
on strict performance of any term, condition or covenant
contained in this Agreement shall not be construed as a waiver of
the rights of any other party thereafter to enforce any other
default of a term, condition or covenant of this Agreement, nor
shall such failure to insist upon strict performance be deemed
sufficient grounds to enable any party hereto to forego or
subvert or otherwise disregard any other term, condition or
covenant of this Agreement.
14.7 This Agreement shall be construed and interpreted in
accordance with the laws of the State of Minnesota.
14.8 Time is of the essence in connection with the performance of
the terms, covenants and conditions contained in this Agreement.
14
15. Assignment. No assignment of this Agreement will be
permitted without the prior written consent of the other party
hereto which consent will not be unreasonably withheld.
16. [intentionally omitted]
17. Further Assurances. Purchaser and Seller agree at any time
and from time to time after the Closing Date to execute and
deliver such additional instruments as may be required to
consummate the terms and conditions of the transaction
contemplated hereby.
18. Public Announcements. Each party hereto agrees that it will
not issue any press release or otherwise make any public
statement with respect to this Agreement or the transactions
contemplated hereby without the prior consent of the other party,
which consent shall not be unreasonably withheld or delayed;
provided, however, that such disclosure can be made without
obtaining such prior consent if (i) the disclosure is required by
law or by obligations imposed pursuant to any listing agreement
with the New York Stock Exchange or any other national securities
exchange and (ii) the party making such disclosure has first used
its best efforts to consult with the other party about the form
and substance of such disclosure.
Executed this tenth day of September, 0000
XXXXXXXXXXXX XXXXXXXXXXX XX XXXXXXX
By /s/ Xxxxxx X. Xxxxxxx, Xx.
Xxxxxx X. Xxxxxxx, Xx.
President and Chief Executive Officer
(the "Purchaser")
MID-CONTINENT POWER COMPANY, L.L.C.
By /s/ Xxxx X'Xxxxxxxx
Manager
By /s/ Xxx X. Xxxxxxxxx
Xxx X. Xxxxxxxxx, Manager
(the "Seller")
15
EXHIBIT A
A. Power Sales Agreement.
1. Electricity Capacity and Energy Agreement dated July 7, 1987,
between Oklahoma Gas and Electric Company and Mid-Continent
Power Corporation ("MCPC").
2. Letter Agreement dated December 17, 1997, executed by Seller
and CSW/PSO regarding the sale of energy.
B. Interconnection Agreement.
3. Electrical Interconnection and Wheeling Agreement dated July
21, 1989, between Public Service Company of Oklahoma (""SO""
and MCPC.
C. Steam Sales Agreement.
4. Process Steam Sale Agreement dated October 1, 1997, between
G-P Gypsum Corporation and OLAC.
5. Sale and Purchase of Thermal Energy Agreement dated July 1,
1994, between Orchids Paper and MCPC.
6. Sale and Purchase of Thermal Energy Agreement dated May 17,
1994, between Elf Atochem North America, Inc. and MCPC.
7. Thermal Energy Sales Agreement dated January 26, 1990,
between Protein Technologies International and MCPC.
8. Sale and Purchase of Thermal Energy Agreement dated July 22,
1994, between G.A.P. Roofing and MCPC.
9. Sale and Purchase of 50 psig Steam Agreement dated September
24, 1984, as amended by an amendment dated 1989, between Oklahoma
Ordnance Works Authority ("OOWA") and MCPC.
D. Compressed Air Sales Agreements.
10. Contract for the Sale and Purchase of Compressed Air dated
September 24, 1984, as amended by amendment dated September 14,
1989, between OOWA and MCPC.
11. Letter Agreement dated October 1, 1990, between MCPC and
Gold Bond Building Products.
E. Supply Agreements.
12. Intrastate Firm Service Agreement between OLAC and Transok,
Inc.
13. Natural Gas Sales Agreement dated October 31, 1997, between
Natural Gas Clearinghouse ("NGC") and Seller.
14. Base Agreement dated December 1, 1997, between Aquila Energy
Marketing Corporation ("Aquila Energy") and Seller, and Amendment
thereto dated December 1, 1997.
15. Two Confirmation Letters dated December 1, 1997, between
Aquila Energy and Seller.
16. Water Supply Agreement dated September 24, 1984, between
MCPC and OOWA.
17. Agreement for the Use of Industrial Sewer System dated April
1, 1995, between OOWA and MCPC.
18. Operations & Maintenance Agreement between NRG Oklahoma
Operations Inc. and OLAC.
19. Confirmation letter from Aquila Energy dated August 14, 1998
regarding gas purchases from November 1, 1998, through October
31, 1999.
2
F. Power Transaction Agreement.
20. Electric Power Service Agreement dated December 12, 1997,
between Seller and Aquila Power Corporation ("Aquila Power").
21. Electric and Transmission Service Scheduling and Spot
Natural Gas Supply Agreement dated December 29, 1997, executed by
Seller, Aquila Power and Aquila Energy.
22. Power and Transmission Scheduling and Spot Natural Gas
Supply Agreement between OLAC and OGE Energy Resources, Inc.
dated June 1, 1998.
G. Guarantees and other commitments made by NRG for the benefit
of Seller or MCPC, which purchaser must either replace or
indemnify NRG for upon closing.
23. Parent Guaranty Agreement dated November 19, 1997, executed
by NRG in favor of NGC.
24. Guaranty Agreement dated October 28, 1997, executed by NRG
in favor of Aquila Energy.
H. Litigation Disclosures.
Oklahoma Gas and Electric Company and its parent company, OGE
Energy Corp. ("OGE Energy"), have threatened litigation against
Oklahoma Loan Acquisition Corporation ("OLAC"), Mid-Continent
Power Company, L.L.C. ("MCPC LLC"), and NRG Energy, Inc. ("NRG"),
based on allegations that, among other things, (a) MCPC is in
default under the terms of a Stock Purchase Agreement dated
December 31, 1997, executed by MCPC LLC and OGE Energy; and (b)
the MCPC facility does not satisfy the QF ownership requirements
of PURPA.
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