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EXHIBIT 10.17a
OWNER PARTICIPANT GUARANTEE
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OWNER PARTICIPANT GUARANTEE
Dated as of August 24, 2000
made by
PSEG RESOURCES INC.
as Guarantor
Conemaugh Facility
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OWNER PARTICIPANT GUARANTEE
This OWNER PARTICIPANT GUARANTEE (this "Guarantee"), dated as of August 24,
2000, is issued by PSEG RESOURCES INC., a New Jersey corporation, as guarantor
(the "Guarantor") in favor of the Beneficiaries (as in Section 4 below).
WITNESSETH:
WHEREAS, the Guarantor is the indirect parent of PSEGR Conemaugh
Generation, LLC, a Delaware limited liability company (the "Owner Participant");
WHEREAS, simultaneously herewith the Owner Participant is entering into a
Participation Agreement, dated as of August 24, 2000 (the "Participation
Agreement"), with Reliant Energy Mid-Atlantic Power Holdings LLC (the "Facility
Lessee"), Conemaugh Lessor Genco LLC (the "Owner Lessor"), Wilmington Trust
Company, not in its individual capacity but as the Lessor Manager under the LLC
Agreement (the "Lessor Manager"), Wilmington Trust Company, in its individual
capacity (the "Trust Company"), Bankers Trust Company, not in its individual
capacity but as the Lease Indenture Trustee under the Lease Indenture (the
"Lease Indenture Trustee") and Bankers Trust Company, not in its individual
capacity and but as the Pass Through Trustee under the Pass Through Trust
Agreements (the "Pass Through Trustee");
WHEREAS, the Guarantor anticipates benefitting directly and indirectly
from the transactions contemplated by the Participation Agreement and is
executing and delivering this Guarantee to induce the Beneficiaries to enter
into the Participation Agreement.
NOW, THEREFORE, in consideration of the foregoing and other benefits
accruing to the Guarantor, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor agrees as follows:
SECTION 1. DEFINITIONS
For purposes of this Guarantee, capitalized terms used but not otherwise
defined herein shall have the respective meanings specified in Appendix A to
the Participation Agreement. The general provisions of Appendix A shall apply
to terms used in this
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Guarantee and specifically defined herein. Any term defined by reference to an
agreement, instrument or other document shall have the meaning so assigned to
it whether or not such document is in effect.
SECTION 2. GUARANTEE
Section 2.1 Subject to the terms hereof, the Guarantor hereby
unconditionally and irrevocably guarantees, as primary obligor and not merely as
a surety, to each of the Beneficiaries severally (a) the due, complete and
punctual performance and observance by the Owner Participant of each term,
provision and condition binding upon the Owner Participant pursuant to any of
the Operative Documents to which the Owner Participant is or becomes a party
(the "OP Operative Documents") and (b) the due, punctual and full payment (when
and as the same may become due and payable) of each amount that the Owner
Participant is or may become obligated to pay to such Beneficiary under or
pursuant to any of the OP Operative Documents, in accordance with the terms
thereof, by acceleration or otherwise without offset or deduction.
Section 2.2 In the case of any failure by the Owner Participant to perform
and observe any such term, provision or condition after notice thereof by any
Beneficiary, the Guarantor agrees, upon notice of any such failure of
performance or observance, to cause such performance or observance to be done,
and in the case of any failure by the Owner Participant to make such payment as
and when the same shall become due and payable (by acceleration or otherwise),
the Guarantor hereby agrees, upon notice of any such failure of payment, to
make such payment (and, in addition, such further amounts, if any, as shall be
sufficient to cover the costs and expenses of collection hereunder); provided,
nothing herein shall expand the aforesaid obligations of the Guarantor beyond
those of the Owner Participant under any of the OP Operative Documents.
All such obligations and indebtedness set forth in Section 2.1 hereof and
this Section 2.2 are referred to in this Guarantee as the "Obligations."
The Guarantor hereby acknowledges and agrees that this Guarantee
constitutes a continuing guaranty and shall remain in full force and effect
until such time as all of the Obligations are finally paid, performed and
observed in full and any time period during which any payment of the Obligations
would be subject to any right of recoupment or recovery by any trustee in
bankruptcy, debtor-in-possession or other Person shall have expired. The
Guarantor further acknowledges that this Guarantee constitutes a guaranty of
payment and, to the extent permitted by Applicable Law,
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performance when due and not of collection and waives any right to require that
any resort be had by any Beneficiary against any other obligor or any other
Person or against any guarantor under any other guarantee covering the
Obligations.
Section 2.3 This Guarantee is a direct, independent and primary
obligation of the Guarantor and is an irrevocable, absolute, present,
unconditional and continuing obligation and guarantee of payment and
performance (and not merely of collection) and the validity and enforceability
of this Guarantee shall be absolute and is not conditioned in any way upon
(a) the institution of suit or the taking of any other action or any attempt to
enforce performance of or compliance with the obligations, covenants or
undertakings (including any payment obligations) of the Owner Participant other
than providing notice to the Owner Participant, (b) the genuineness, validity,
legality or enforceability of any of the OP Operative Documents or the lack of
power or authority of the Owner Participant to enter into any of the OP
Operative Documents or any substitution, release or exchange of any other
Guarantee or any other security for any of the Obligations or any other
circumstance whatsoever (other than payment or performance) that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, (c) any right of set-off, recoupment or counterclaim, (d) any
attempt to collect from the Owner Participant or any other entity or to perfect
or enforce any security or any other condition or contingency or (e) any other
action, occurrence or circumstance whatsoever.
Section 2.4 Without limiting the generality of the foregoing, and
subject to Section 6 hereof, the Guarantor shall have no right to terminate
this Guarantee, or to be released, relieved or discharged from its obligations
hereunder, and such obligations shall be neither affected nor diminished for any
reason whatsoever, including:
(i) any amendment or supplement to or modification of any of the OP
Operative Documents, any extension or renewal of the Owner
Participant's obligations under any OP Operative Document, or any
subletting, assignment or transfer of the Owner Participant's or any
Beneficiary's interest in the OP Operative Documents;
(ii) any bankruptcy, insolvency, readjustment, composition,
liquidation or any other change in the legal status of the Owner
Participant or any rejection or modification of the Obligations of the
Owner Participant or any Beneficiary as a result of any bankruptcy,
reorganization, insolvency or similar proceeding;
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(iii) any furnishing or acceptance of additional security or any
exchange, substitution, surrender or release of any security;
(iv) any waiver, consent or other action or inaction or any
exercise or nonexercise of any right, remedy or power with
respect to the Obligations or any of the OP Operative Documents;
(v) the unenforceability, lack of genuineness, irregularity or
invalidity of the Obligations or any part thereof or the
unenforceability, lack of genuineness, irregularity or invalidity
of any agreement relating thereto;
(vi) (A) any merger or consolidation of the Owner Participant or
the Guarantor into or with any other Person, (B) any change in the
structure of the Owner Participant, (C) any change in the
ownership of the Owner Participant or the Guarantor or (D) any
sale, lease, or transfer of any or all of the assets of the Owner
Participant or the Guarantor to any other Person;
(vii) any default, misrepresentation, negligence, misconduct or
other action or inaction of any kind by any Beneficiary under or
in connection with any OP Operative Document or any other
agreement relating to this Guarantee, except to the extent that
any such default, misrepresentation, negligence, misconduct or
other action or inaction would limit the Obligations; or
(viii) any other circumstance whatsoever (except the complete
payment and performance or the Obligations), including, without
limitation, any act or omission of the Owner Participant or
any Beneficiary which changes the scope of the Guarantor's risk.
Section 2.5 The Guarantor hereby unconditionally waives and releases,
to the extent permitted by law promptness, diligence and notice as to the
Obligations guaranteed hereby and acceptance of this Guarantee, and waives any
other circumstance which might otherwise constitute a defense available to, or a
discharge of, the Guarantor, including, without limitation, suretyship defenses,
notice of default or any failure on the part of the Owner Participant to perform
and comply with any Obligation and agrees that, except as otherwise provided
herein or in the Operative Documents, it shall not be required to consent to or
receive any notice of any amendment or
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modification of, or waiver, consent or extension with respect to, the OP
Operative Documents. No failure to exercise and no delay in exercising, on the
part of any Beneficiary, any right, power or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any right,
power or privilege preclude any other or further exercise thereof, or the
exercise of any other power or right. The rights and remedies herein provided
are cumulative and not exclusive of any rights or remedies provided by law.
Section 2.6 The Guarantor agrees to pay any costs and expenses incurred
by the other parties to the Participation Agreement in connection with the
enforcement of this Guarantee.
SECTION 3. GUARANTOR'S REPRESENTATIONS AND WARRANTIES
In order to induce the Beneficiaries to enter into the
Participation Agreement, the Guarantor represents and warrants unto the
Beneficiaries as set forth in this Section III.
Section 3.1 The Guarantor (i) has a tangible net worth of at least $75
million calculated in accordance with GAAP; and (ii) qualifies as "a United
States person" within the meaning of section 7701(a)(30) of the Code.
Section 3.2 The Guarantor is duly organized, validly existing and in
good standing under the laws of the state of incorporation and has full power,
authority and legal right to execute, deliver and perform this Guarantee.
Section 3.3 The execution, delivery and performance by the Guarantor of
this Guarantee has been duly authorized by all necessary corporate action. This
Guarantee constitutes a legal, valid and binding obligation of the Guarantor
enforceable against the Guarantor in accordance with its terms, except as such
enforcement may be affected by applicable bankruptcy, insolvency, moratorium and
other similar laws affecting creditors' rights generally.
Section 3.4 The execution, delivery and performance of this Guarantee
will not contravene any provision of law, rule or regulation to which the
Guarantor is subject or any judgment, decree or order applicable to the
Guarantor nor conflict or be inconsistent with or result in any breach of any
terms, covenants, conditions or provisions of, or constitute a default under, or
result in the creation or imposition of (or
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the obligation to create or impose) any Lien or other encumbrance upon any of
the property or assets of the Guarantor pursuant to the terms of any agreement
or other instrument to which the Guarantor is a party or by which it or its
property is bound or to which it or its property may be subject, the violation
of which could have a material adverse effect on the financial condition of the
Guarantor, nor violate any provision of the articles of incorporation or bylaws
of the Guarantor.
Section 3.5 No pending or, to the knowledge of the Guarantor,
threatened action, suit, investigation or proceeding against the Guarantor
before any Governmental Entity exists which, if determined adversely to the
Guarantor, would materially adversely affect the Guarantor's ability to perform
its obligations under this Guarantee.
Section 3.6 No consent from any Person is required for the execution,
delivery and performance by the Guarantor of this Guarantee except that which
has been given and remains in full force and effect.
SECTION 4. BENEFICIARIES
Each of the Facility Lessee, the Owner Lessor, the Lessor Manager, the
Trust Company, so long as the Lien of the Lease Indenture has not been
terminated or discharged the Lease Indenture Trustee, the Lease Indenture
Company and the Pass Through Trustee (on behalf of itself and as Pass Through
Trustee) and, in each case, together with their respective successors and
permitted assigns, are each beneficiaries of this Guarantee (each a
"Beneficiary" or, together, the "Beneficiaries").
SECTION 5. SURVIVAL OF GUARANTEE
Notwithstanding anything to the contrary herein, this Guarantee shall
continue to be effective or be reinstated, as the case may be, if at any time
any of the amounts paid to any of the Beneficiaries, in whole or in part, is
required to be repaid upon the insolvency, bankruptcy, dissolution,
liquidation, or reorganization of the Guarantor, the Owner Participant or any
other Person, or as a result of the appointment of a custodian, interviewer,
receiver, trustee, or other officer with similar powers with respect to the
Guarantor, the Owner Participant or any other Person or with respect to any
substantial part of the property of the Guarantor, the Owner Participant or
such other Person, all as if such payments had not been made.
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SECTION 6. TERMINATION
This Guarantee and the Guarantor's duties and obligations hereunder
shall remain in full force and effect and be binding in accordance with its
terms until the earlier of (a) the date on which all Obligations shall have
been satisfied by payment and performance in full or (b) such time as the Owner
Lessor shall have effected a transfer of all of the Owner Lessor's Interest
pursuant to a transfer which complies with the requirements of Section 8.1 of
the Participation Agreement or (c) such time as the Guarantor shall cease to
have any interest, direct or indirect, in the member interest of the Owner
Participant provided that any transfer of any member interest in the Equity
Subsidiary or Owner Participant which results in the Guarantor ceasing to have
any such interest, direct or indirect, in the Owner Participant shall have been
effected pursuant to a transfer which complies with requirements of Section 8.1
of the Participation Agreement; provided, however, that with respect to clauses
(b) and (c) above, in no event shall any transfer referenced in such clauses
waive or release the Guarantor from any liability existing under the Guarantee
immediately prior to or occurring simultaneously with such transfer.
SECTION 7. REMEDIES; SUBROGATION
Section 7.1 Remedies. In the event the Guarantor shall fail to pay
immediately any amounts due under this Guarantee, or to comply with any other
term of this Guarantee, each Beneficiary shall be entitled to all rights and
remedies to which it may be entitled hereunder or at law, in equity or by
statute.
Section 7.2 Subrogation. The Guarantor will not exercise any rights
that it may acquire by way of subrogation under this Guarantee, by any payment
made hereunder or otherwise, until all of the Obligations shall have been paid
in full. If any amount shall be paid to the Guarantor on account of such
subrogation rights at any time when all of the Obligations shall not have been
paid in full, such amount shall be held in trust for the benefit of the
Beneficiary to whom such Obligation is payable and shall forthwith be paid to
such Beneficiary to be credited and applied to such Obligation, whether matured
or unmatured, in accordance with the terms of the Operative Document under
which such Obligation arose. If (i) the Guarantor shall make payment to any
Beneficiary of all or any part of the Obligations and (ii) all the Obligations
shall be paid in full, such Beneficiary will, at the Guarantor's request and
expense, execute and deliver to the Guarantor appropriate documents, without
recourse and with representa-
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tion or warranty, necessary to evidence the transfer by subrogation to the
Guarantor of an interest in the Obligations resulting from such payment by the
Guarantor.
Section 7.3 Survival of Remedies and Subrogation Rights. The provisions of
this Section 7 shall survive the termination of this Guarantee and the payment
in full of the Obligations and the termination of the Operative Documents.
Section 7.4 Failure or Delay. This Guarantee is a continuing one and all
liabilities to which it applies or may apply under the terms hereof shall be
conclusively presumed to have been created in reliance hereon. No failure or
delay on the part of any Beneficiary in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
SECTION 8. MISCELLANEOUS
Section 8.1 Amendments and Waivers. No term, covenant, agreement or
condition of this Guarantee may be terminated, amended or compliance therewith
waived (either generally or in a particular instance, retroactively or
prospectively) except by an instrument or instruments in writing executed by the
Guarantor and consented to by the Beneficiaries.
Section 8.2 Notices. Unless otherwise specifically provided herein, all
notices, consents, directions, approvals, instructions, requests and other
communications required or permitted by the terms hereof shall be in writing and
shall be made or given in accordance with Section 17.6 of the Participation
Agreement; provided that notices to the Guarantor shall be addressed to its
address set forth on the signature page hereof, or at such other address as the
Guarantor may from time to time designate by written notice to the
Beneficiaries.
Section 8.3 Survival. Except as expressly set forth herein, the warranties
and covenants made by the Guarantor shall not survive the expiration or
termination of this Guarantee.
Section 8.4 Assignment and Assumption. This Guarantee may not be assigned
by the Guarantor to, or assumed by, any successor to, or assignee of, the
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Guarantor without the prior written consent of the Beneficiaries except as
provided by the terms of the Operative Documents.
Section 8.5 Governing Law. This Guarantee shall be in all respects
governed by and construed in accordance with the laws of the State of New York,
including all matters of construction, validity and performance (without giving
effect to the conflicts of laws provisions, other than New York General
Obligations Law Section 5-1401).
Section 8.6 Severability. Any provision of this Guarantee that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 8.7 Merger. This Guarantee constitutes the entire agreement
and supersedes all prior agreements and understandings, both written and oral
between or among the Guarantor, the Owner Participant, and each Beneficiary with
respect to the subject matter hereof.
Section 8.8 Headings. The headings of the sections of this Guarantee
are inserted for purposes of convenience only and shall not be construed to
affect the meaning or construction of any of the provisions hereof.
Section 8.9 Further Assurances. The Guarantor will promptly and duly
execute and deliver such further documents to make such further assurances for
and take such further action reasonably requested by any of the Beneficiaries
referred to in Section 4 hereof to whom the Guarantor is obligated, all as may
be reasonably necessary to carry out more effectively the intent and purpose of
this Guarantee.
Section 8.10 Effectiveness of Guarantee. This Guarantee shall be
effective on the date of execution and delivery by the Guarantor.
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IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed and delivered by its officer thereunto duly authorized.
PSEG RESOURCES INC.
as Guarantor
By: /s/ XXXXXX X. XXXXX
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Name: Xxxxxx X. Xxxxx
Title: President
Notice Address:
PSEG Resources Inc.
00 Xxxx Xxxxx, Xxxxx X-00
Xxxxxx, XX 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: President
