AGREEMENT dated as of December 20, 2005 by and among Steam Heat LLC, and Thermal Power Company and solely for purposes of Sections 6.2, 7.2.8 and 7.4 hereof, Geysers Power Company, LLC
Exhibit 2.6
EXECUTION VERSION
dated as of
December 20, 2005
by and among
Steam Heat LLC,
and
Thermal Power Company
and
solely for purposes of Sections 6.2, 7.2.8 and 7.4 hereof, Geysers Power Company, LLC
TABLE OF CONTENTS
Page | ||||
ARTICLE 1 DEFINITIONS AND INTERPRETATION |
1 | |||
1.1 Defined Terms |
1 | |||
1.2 Interpretation |
8 | |||
ARTICLE 2 TERMS AND CONDITIONS OF DESIGNATION RIGHT |
9 | |||
2.1 Grant of Designation Right |
9 | |||
2.2 Designation Right Period |
9 | |||
2.3 Designation Right Consideration |
9 | |||
2.4 Exclusivity |
10 | |||
2.5 Designation |
10 | |||
2.6 Exercise |
10 | |||
2.7 Expiration of Purchase Right |
10 | |||
2.8 Seller Termination Right |
10 | |||
ARTICLE 3 TERMS AND CONDITIONS OF PURCHASE AND SALE TRANSACTION |
11 | |||
3.1 Sale and Purchase of Owner Participant Interests |
11 | |||
3.2 Purchase Price |
11 | |||
3.3 Parties to Bear Own Expenses |
11 | |||
ARTICLE 4 CLOSING AND CLOSING CONDITIONS |
11 | |||
4.1 Time and Place of the Closing |
11 | |||
4.2 Actions at the Closing |
12 | |||
4.2.1 Transfer of Owner Participant Interests |
12 | |||
4.2.2 Payment of Purchase Price |
12 | |||
4.2.3 Nonforeign Certificate |
12 | |||
4.2.4 Additional Actions |
12 | |||
4.3 Conditions Precedent to Obligations of Purchaser |
12 | |||
4.3.1 Performance of Closing Actions |
12 | |||
4.3.2 No Violation |
12 | |||
4.3.3 Approvals and Consents |
12 | |||
4.3.4 No Proceeding or Litigation |
12 | |||
4.3.5 Representations, Warranties and Covenants |
13 | |||
4.3.6 Officer’s Certificates |
13 | |||
4.3.7 Legal Opinion |
13 | |||
4.3.8 Participation Agreement |
13 | |||
4.3.9 Lessor Notes |
13 | |||
4.4 Conditions Precedent to Obligations of Seller |
13 | |||
4.4.1 Performance of Closing Actions |
13 | |||
4.4.2 No Violation |
13 | |||
4.4.3 Approvals and Consents |
13 | |||
4.4.4 No Proceeding or Litigation |
14 | |||
4.4.5 Representations, Warranties and Covenants |
14 |
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Page | ||||
4.4.6 Officer’s Certificates |
14 | |||
4.4.7 Legal Opinion |
14 | |||
4.4.8 Participation Agreement |
14 | |||
4.5 Failure of Conditions |
14 | |||
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF SELLER |
15 | |||
5.1 Representations and Warranties of Seller |
15 | |||
5.1.1 Organization |
15 | |||
5.1.2 Authority and Power |
15 | |||
5.1.3 Valid and Binding Obligations |
15 | |||
5.1.4 Approvals and Consents |
15 | |||
5.1.5 No Violations |
16 | |||
5.1.6 No Litigation |
16 | |||
5.1.7 Owner Participant Interests |
16 | |||
5.1.8 Brokers’ Fees |
16 | |||
5.1.9 Bankruptcy |
17 | |||
5.1.10 No Indebtedness or Liabilities |
17 | |||
5.1.11 United States Person |
17 | |||
5.1.12 Operative Documents |
17 | |||
5.2 No Further Representations |
17 | |||
ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF TPC AND GPC |
18 | |||
6.1 Representations and Warranties of TPC |
18 | |||
6.1.1 Organization |
18 | |||
6.1.2 Authority and Power |
18 | |||
6.1.3 Valid and Binding Obligations |
18 | |||
6.1.4 Approvals and Consents |
18 | |||
6.1.5 No Violations |
18 | |||
6.1.6 No Litigation |
19 | |||
6.1.7 Brokers’ Fees |
19 | |||
6.1.8 Bankruptcy |
19 | |||
6.1.9 Geysers Entities |
19 | |||
6.2 Representations and Warranties of GPC |
19 | |||
6.3 No Further Representations |
19 | |||
ARTICLE 7 COVENANTS |
19 | |||
7.1 Consummation of Transactions and Obtaining Approvals |
19 | |||
7.2 Tax Matters |
20 | |||
7.2.1 Like-Kind Exchange |
20 | |||
7.2.2 Allocation of Income |
20 | |||
7.2.3 Tax Returns |
20 | |||
7.2.4 Refunds |
21 | |||
7.2.5 Audits and Other Contests |
21 | |||
7.2.6 Cooperation |
21 | |||
7.2.7 Transfer Taxes |
21 | |||
7.2.8 GPC Acknowledgement |
21 | |||
7.3 Optional Prepayment or Refinancing |
22 |
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Page | ||||
7.4 Conduct During Designation Right Period |
22 | |||
7.5 Forbearance |
23 | |||
ARTICLE 8 INDEMNIFICATION |
23 | |||
8.1 General |
23 | |||
8.2 Survival of Representations and Warranties |
24 | |||
8.3 Procedure for Indemnification with Respect to Third-Party Claims |
24 | |||
8.3.1 Notice of Claim |
24 | |||
8.3.2 Conduct of Claim |
24 | |||
8.3.3 Payment of Claim |
25 | |||
8.3.4 Access to Information |
25 | |||
ARTICLE 9 MISCELLANEOUS |
26 | |||
9.1 Notices |
26 | |||
9.2 Entire Agreement; Amendments |
27 | |||
9.3 Successors and Assigns |
27 | |||
9.4 Currency Matters |
27 | |||
9.5 Governing Law |
27 | |||
9.6 Consent to Jurisdiction |
27 | |||
9.7 Publicity |
28 | |||
9.8 Joint Effort |
28 | |||
9.9 Captions |
28 | |||
9.10 Severability |
28 | |||
9.11 Counterparts |
28 | |||
9.12 Third Parties |
28 | |||
9.13 No Waiver |
28 | |||
9.14 Breach; Equitable Relief |
29 |
iii
EXHIBITS
Exhibit A
|
Form of Assignment and Assumption Agreement | |
Exhibit B
|
Form of Seller Guaranty | |
Exhibit C
|
Form of Nonforeign Certificate | |
Exhibit D
|
Letter Agreement |
SCHEDULES
Schedule 5.1.4
|
Seller Approvals and Consents | |
Schedule 6.1.4
|
TPC and GPC Approvals and Consents |
iv
This AGREEMENT (“Agreement”), dated as of December 20, 2005, is entered into by and between
Steam Heat LLC, a Delaware limited liability company (“Seller”), Thermal Power Company, a
California corporation (“TPC”), and, solely for purposes of Sections 6.2, 7.2.8 and 7.4
hereof, Geysers Power Company, LLC, a Delaware limited liability company (“GPC”). Seller and TPC
are also sometimes hereinafter referred to individually as a “Party” and collectively as the
“Parties.”
RECITALS
WHEREAS, Seller owns all of the beneficial right, title and interest in and to the Owner
Participant Interests (as defined below); and
WHEREAS, Seller has offered to sell the Owner Participant Interests to a purchaser designated
by TPC; and
WHEREAS, TPC desires to designate a purchaser to purchase the Owner Participant Interests from
Seller; and
WHEREAS, Seller’s obligations under this Agreement will be guaranteed by Guarantor (as defined
below).
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants herein, and for
other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged,
the Parties and GPC, intending to be legally bound, hereby agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 Defined Terms. Capitalized terms used in this Agreement (including in the recitals
hereto) without other definition shall have the following meanings, unless the context clearly
requires otherwise:
“Affiliate” means, with respect to a Person, any other Person that, directly or indirectly
through one or more intermediaries, Controls, is Controlled by or is under common Control with such
first Person; provided that Parent and its Affiliates are in all instances to be considered
Affiliates of TPC.
“Agreement” means this Agreement, including all Exhibits, Schedules and other attachments
hereto.
“Amendment No. 2 to the Project Revenues Agreement” means that certain Amendment No. 2 to the
Project Revenues Agreement entered into as of December 20, 2005 by
and among O.L.S. Energy-Agnews, Inc. (formerly O.L.S. Energy-Agnews), a corporation
1
organized
and existing under the laws of the State of Delaware, Credit Suisse, New York Branch (successor to
Credit Suisse First Boston), a bank organized and existing under the laws of Switzerland, in its
capacity as depository, and The Bank of New York Trust Company, N.A. (formerly BNY Western Trust
Company, successor to Meridian Trust Company of California), not in its individual capacity except
as expressly set forth therein but solely as owner trustee under the applicable trust agreement.
“Assignment and Assumption Agreement” means an agreement substantially in the form attached
hereto as Exhibit A.
“Bankruptcy Code” means the Bankruptcy Reform Act of 1978, as amended.
“Bankruptcy Court” means the United States Bankruptcy Court for the Southern District of New
York, or any other court having jurisdiction over a bankruptcy case pending under Chapter 11 of the
Bankruptcy Code in which any of GPC, TPC, Purchaser or Parent is a debtor from time to time.
“Bankruptcy Event” means, with respect to any Person, the occurrence of one or more of the
following events: (a) such Person (i) files, or consents by answer or otherwise to the filing
against it of, a petition for relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction, (ii) makes an assignment for the benefit of
its creditors, (iii) consents to the appointment of a custodian, receiver, trustee or other officer
with similar powers with respect to it or with respect to any substantial part of its property,
(iv) is adjudicated as insolvent or to be liquidated, or (v) takes action for the purpose of any of
the foregoing; or (b) a court or Governmental Person of competent jurisdiction enters an order
appointing, without consent by such Person, a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial part of its property, or
constituting an order for relief or approving a petition for relief or reorganization or any other
petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law
of any jurisdiction, or ordering the dissolution, winding-up or liquidation of such Person, or any
such petition shall be filed against such Person and such petition shall not have been dismissed.
“Business Day” means any day other than a Saturday, Sunday or other day on which commercial
banks in New York, New York are required or authorized by Law to close.
“Charter Documents” means, with respect to any Person, all organizational documents and all
shareholders agreements, limited liability company agreements, members agreements, partnership
agreements or similar Contracts relating to the ownership or governance of such Person.
“Closing” has the meaning given in Section 4.1.
“Closing Actions” has the meaning given in Section 4.2.
“Closing Date” has the meaning given in Section 4.1.
2
“Code” means the Internal Revenue Code of 1986, as amended.
“Collateral Documents” has the meaning given to such term in the Participation Agreement.
“Contract” means any agreement, contract, lease, consensual obligation, promissory note,
evidence of indebtedness, purchase order, letter of credit, license, promise or undertaking of any
nature (whether written or oral and whether express or implied), including, but not limited to,
letters of intent, executed term sheets, and similar evidences of an agreement in principle.
“Control” means the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise. The term “Control” when used as a verb shall have a
correlative meaning.
“Designation Right” has the meaning set forth in Section 2.1.
“Designation Right Consideration” has the meaning set forth in Section 2.3.
“Designation Right Expiration Date” means May 31, 2006.
“Designation Right Period” has the meaning set forth in Section 2.2.
“Effective Date” means the later of (i) December 20, 2005, (ii) the date of the effectiveness
of Amendment No. 2 to the Project Revenues Agreement and (iii) the date of the effectiveness of the
Seller Guaranty.
“Election Notice” has the meaning given in Section 2.6.
“Exchange” has the meaning given in Section 7.2.1.
“Facilities” has the meaning given to such term in the Participation Agreement.
“Facility Lease” has the meaning given to such term in the Participation Agreement.
“Facility Lessee” has the meaning given to such term in the Participation Agreement.
“FERC” means the Federal Energy Regulatory Commission and its successors.
“FERC Approval” means approval by FERC under Section 203 of the Federal Power Act of the
transfer of the Owner Participant Interests from Seller to a Person designated by TPC pursuant to
this Agreement.
“Geysers Entity” means any of GPC, Geysers Power Company II, LLC, a Delaware limited liability
company, Geysers Power I Company, a Delaware corporation, TPC, Xxxxxxxx Springs Energy Company, a
California corporation, or Calpine Power Company, a California corporation.
3
“Governmental Approval” means any authorization, approval, consent, license, ruling, permit,
tariff, certification, exemption, order, recognition, grant, confirmation, clearance, filing or
registration by or with any Governmental Person.
“Governmental Person” means any federal, national, regional, state, municipal or local
government, any political subdivision or any governmental, judicial, public or statutory
instrumentality, tribunal, court, agency, authority, body or entity, or other regulatory bureau,
authority, body or entity having legal jurisdiction over the matter or Person in question.
“Governmental Rule” means any applicable federal, national, regional, state, municipal or
local law, statute, treaty, rule, regulation, ordinance, order, code, judgment, decree, directive,
injunction, writ or similar action or decision duly implementing any of the foregoing by any
Governmental Person, other than Governmental Approvals.
“GPC” has the meaning given in the preamble to this Agreement.
“Guarantor” means Verizon Capital Corp., a Delaware corporation.
“Indebtedness” of any Person means (i) indebtedness of such Person for borrowed money, (ii)
obligations of such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) obligations of such Person to pay the deferred purchase price of property or services, (iv)
indebtedness created or arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession or sale of such
property), (v) all obligations, contingent or otherwise, of such Person under acceptance, letter of
credit or similar facilities, (vi) all unconditional obligations of such Person to purchase,
redeem, retire, defease or otherwise acquire for value any capital stock or other equity interests
of such Person or any warrants, rights or options to acquire such capital stock or other equity
interests, (vii) all obligations under “swaps,” “caps,” “floors,” “collars” or other interest rate
hedging contracts or similar arrangements, (viii) all Indebtedness of any other Person of the type
referred to in clauses (i) through (vii) above, guaranteed by such Person or for which such Person
shall otherwise (including pursuant to any keepwell, makewell or similar arrangement) become
directly or indirectly liable, (ix) all Indebtedness of the type referred to in clauses (i) through
(vii) above secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, secured by) any Lien on property (including accounts and contract rights)
owned by such Person, even though such Person has not assumed or become liable for the payment of
such Indebtedness, the amount of such obligation being deemed to be the lesser of the value of such
property or the amount of the obligation so secured.
“Indemnified Group” has the meaning given in Section 8.1.
“Indemnified Party” has the meaning given in Section 8.1.
“Indemnitor” has the meaning given in Section 8.1.
“IRS” means the United States Internal Revenue Service.
4
“Knowledge” means (a) with respect to Seller, the actual knowledge of the officers and
employees of Seller and its Affiliates who, by virtue of their respective offices or job
responsibilities, would reasonably be expected to have the information which is the subject of a
particular representation, and (b) with respect to TPC, GPC or any Affiliate thereof, the actual
knowledge of the officers and employees of TPC, GPC or their respective Affiliates who, by virtue
of their respective offices or job responsibilities, would reasonably be expected to have the
information which is the subject of a particular representation.
“Law” means all (a) Governmental Approvals, and (b) Governmental Rules.
“Lease Debt” means the debt evidenced by the Original Lessor Note, the Calistoga Lessor Note,
the XX Xxxxxx Note and the Aidlin Lessor Note (each as defined in the Participation Agreement).
“Lease Event of Default” has the meaning given to such term in the Participation Agreement.
“Lease Indenture” has the meaning given to such term in the Participation Agreement.
“Lease Indenture Event of Default” has the meaning given to such term in the Participation
Agreement.
“Lenders” has the meaning given to such term in the Participation Agreement.
“Lien” means any mortgage, pledge, lien, charge, claim, option, equitable interest, security
interest, third party right, assignment, hypothecation, encumbrance or other agreement or
arrangement which has the same or a similar effect to the granting of security or of any similar
right of any kind (including any conditional sale or other title retention agreement).
“Loss” means the amount of (a) any out of pocket loss, cost, expense, damage or liability,
including interest, fines, reasonable legal and accounting fees and expenses, but excluding
consequential, indirect, special or punitive damages of Indemnified Parties, reduced by (b) any
amounts received by the Indemnified Parties as a result of any recovery, settlement, or otherwise
under or pursuant to any insurance coverage, or pursuant to any claim, recovery, settlement, or
payment by or against any other Person in connection with the circumstances giving rise to such
Loss.
“Operative Documents” means the Operative Documents (as defined in the Participation
Agreement).
“Owner Lessor” means Geysers Statutory Trust, a Connecticut statutory trust created under an
Amended and Restated Trust Agreement dated as of May 7, 1999 (as amended and restated by the Second
Amended and Restated Trust Agreement dated as of May 7, 1999) naming State Street Bank and Trust
Company of California, National Association, as Owner Trustee for the benefit of Seller, as Owner
Participant, under the Participation Agreement.
“Owner Participant” has the meaning given to such term in the Participation Agreement.
5
“Owner Participant Interests” means (i) all of Seller’s beneficial interest in the Trust
Estate created and existing under the Trust Agreement, and (ii) all of Seller’s right, title and
interest in, to and under the Operative Documents to which Seller is a party, but excluding any
Retained Rights.
“Parent” means Calpine Corporation, a Delaware corporation.
“Participation Agreement” means that certain Third Amended and Restated Participation
Agreement, dated as of May 7, 1999, among (i) GPC, as Facility Lessee, (ii) Geysers Statutory
Trust, a Connecticut statutory trust created under an Amended and Restated Trust Agreement dated as
of May 7, 1999 (as amended and restated by the Second Amended and Restated Trust Agreement dated as
of May 7, 1999) naming State Street Bank and Trust Company of California, National Association, as
Owner Trustee for the benefit of Seller, (iii) State Street Bank and Trust Company of California,
National Association, a national banking association, not in its individual capacity, except as
expressly provided in the Participation Agreement, but solely as trustee under the Second Amended
and Restated Trust Agreement dated as of May 7, 1999, (iv) Seller, as Owner Participant, (v) First
Union Trust Company, National Association, a national banking association, not in its individual
capacity, except as expressly provided in the Participation Agreement, but solely as trustee under
the Lease Indenture (as defined in the Participation Agreement), (vi) Silverado Geothermal
Resources, Inc., a California corporation, (vii) Steam Heat Lender Trust, a Delaware business trust
created for the benefit of Newcourt Project Finance Fund, and (viii) Newcourt Capital USA Inc., a
Delaware corporation.
“Party” or “Parties” has the meaning given in the preamble to this Agreement.
“Person” means any individual, sole proprietorship, corporation, partnership, joint venture,
limited liability partnership, limited liability company, trust, unincorporated association,
institution, Governmental Person or any other entity.
“Pledge Agreement” has the meaning given to such term in the Participation Agreement.
“Post-Closing Period” means the period commencing from and after the consummation of the
Closing.
“Pre-Closing Period” means the period occurring prior to the consummation of the Closing.
“Purchase Price” has the meaning given in Section 3.2.
“Purchase Right” has the meaning given in Section 2.1.
“Purchaser” has the meaning given in Section 2.1.
“Retained Rights” means the Owner Participant’s or Owner Lessor’s rights to general, tax or
other indemnity payments under the Operative Documents relating to matters arising in respect of
the Pre-Closing Period or fairly attributable to any such period.
6
“Seller” has the meaning given in the preamble to this Agreement.
“Seller Guaranty” means a guaranty by Guarantor of Seller’s obligations hereunder for the
benefit of TPC and Purchaser in the form of Exhibit B hereto.
“Seller Termination Triggering Event” means the occurrence of a Significant Lease Default
related to payment obligations or Bankruptcy Events or any Lease Event of Default; provided
that (i) with respect to the Lease Events of Default set forth in (A) Sections 16(l) and 16(n)
of the Facility Lease and (B) Section 16(e) of the Facility Lease solely with respect to the
Facility Lessee’s failure to perform or observe in any material respect its obligations set forth
in any of Sections 5.2, 5.3, 5.19, 5.34, 5.40, 5A.2, 5A.16, 13.1 and 13.3 of the Participation
Agreement, a Seller Termination Triggering Event shall only be deemed to occur if such Lease Event
of Default described in clauses (A) or (B) of this clause (i) shall remain uncured for two (2)
Business Days after the earlier of (x) receipt of written notice from Seller to TPC of such Lease
Event of Default or (y) TPC or any Affiliate obtains Knowledge of such Lease Event of Default, (ii)
with respect to the Lease Events of Default set forth in (A) Sections 16(c), 16(j), 16(k) and 16(m)
of the Facility Lease and (B) Section 16(e) of the Facility Lease solely with respect to the
Facility Lessee’s failure to perform or observe in any material respect its obligations set forth
in any of Sections 5.1, 5.14, 5.20(a), 5.33, 5.41, 5.44, 5A.1, 5A.11, 5A.23, 5A.27 and 5A.29 of the
Participation Agreement, a Seller Termination Triggering Event shall only be deemed to occur if
such Lease Event of Default described in clauses (A) or (B) of this clause (ii) shall remain
uncured for five (5) Business Days after the earlier of (x) receipt of written notice from Seller
to TPC of such Lease Event of Default or (y) TPC or any Affiliate obtains Knowledge of such Lease
Event of Default, and (iii) with respect to the Lease Events of Default set forth in Section 16(e)
of the Facility Lease solely with respect to the Facility Lessee’s failure to perform or observe in
any material respect its obligations set forth in any of Sections 5.32, 5.35, 5.36, 5.38, 5A.3,
5A.22, 5A.24 and 5A.25 of the Participation Agreement, a Seller Termination Triggering Event shall
only be deemed to occur if such Lease Event of Default described in this clause (iii) shall remain
uncured for thirty (30) days after the earlier of (x) receipt of written notice from Seller to TPC
of such Lease Event of Default or (y) TPC or any Affiliate obtains Knowledge of such Lease Event of
Default. The term “Seller Termination Triggering Event” as used in this Agreement shall not
include any Significant Lease Default or Lease Event of Default existing as of the date of
execution of this Agreement of which Seller has Knowledge as of the date of execution of this
Agreement.
“Significant Lease Default” has the meaning given to such term in the Participation Agreement.
“Stock Pledge Agreement” has the meaning given to such term in the Participation Agreement.
“Subsidiary” shall mean, with respect to a specified Person, any other Person Controlled by
the specified Person.
“Tax” or “Taxes” means all taxes, including all charges, fees, duties, levies or other
assessments in the nature of taxes, imposed by any federal, state, local or foreign Governmental
Person, including income, gross receipts, excise, property, sales, gain, use, license, custom duty,
7
unemployment, inheritance, corporation, capital stock, transfer, franchise, payroll,
withholding, social security, minimum estimated, profit, gift, severance, value added, disability,
premium, recapture, credit, occupation, service, leasing, employment, stamp, goods and services, ad
valorem, utility, utility users and other taxes, and shall include interest, penalties or additions
attributable thereto or attributable to any failure to comply with any requirement regarding Tax
Returns.
“Tax Return” means any return, declaration, report, claim for refund, or information return or
statement relating to Taxes, including any such document prepared on a consolidated, combined or
unitary basis and also including any schedule or attachment thereto, and including any amendment
thereof.
“Taxing Authority” means the IRS and any other Governmental Person responsible for
administration of Taxes under the Laws of any jurisdiction.
“TIA” has the meaning given in Section 7.2.8.
“TPC” has the meaning given in the preamble to this Agreement.
“Transaction Documents” means, collectively, this Agreement, the Assignment and Assumption
Agreement and all other agreements between the Parties or their Affiliates entered into pursuant to
the terms hereof in order to carry out the Closing Actions and the other transactions contemplated
hereby.
“Transfer Tax” has the meaning given in Section 7.2.7.
“Trust Agreement” means that certain Second Amended and Restated Declaration of Trust for
Geysers Statutory Trust dated as of May 7, 1999 between Seller and State Street Bank and Trust
Company of California, National Association.
“Trust Estate” has the meaning given to such term in the Participation Agreement.
1.2 Interpretation. Except where otherwise expressly provided or unless the context otherwise
necessarily requires, in this Agreement (including in the recitals hereto):
(a) Reference to a given Article, Section, Subsection, clause, Exhibit or Schedule is a
reference to an Article, Section, Subsection, clause, Exhibit or Schedule of this Agreement, unless
otherwise specified.
(b) The terms “hereof,” “herein,” “hereto,” “hereunder” and “herewith” refer to this Agreement
as a whole.
(c) Reference to a given agreement, instrument, document or Law is a reference to that
agreement, instrument, document or Law as modified, amended, supplemented and restated through the
date as of which such reference is made, and, as to any Law, any successor Law.
8
(d) Reference to a Person includes its predecessors, successors and permitted assigns.
(e) The singular includes the plural and the masculine includes the feminine, and vice versa.
(f) “Includes” or “including” means “including, for example and without limitation.”
(g) References to “days” means calendar days.
(h) Any item disclosed by a Party on any Schedule to this Agreement shall be deemed to be
disclosed and incorporated by reference into each other Schedule or representation or warranty
delivered or made by such Party in this Agreement, as though fully set forth therein.
ARTICLE 2
TERMS AND CONDITIONS OF DESIGNATION RIGHT
2.1 Grant of Designation Right. Seller hereby grants to TPC the exclusive right to designate
a purchaser of the Owner Participant Interests (the “Designation Right”) for the consideration and
under the terms and conditions set forth herein, which designee (the “Purchaser”) shall, upon such
designation, have the exclusive right (as set forth in Section 2.4 below) to purchase the
Owner Participant Interests during the Designation Right Period (the “Purchase Right”); it being
acknowledged and agreed that (i) TPC may be designated as “Purchaser” hereunder, and (ii) the
designated “Purchaser” shall be Parent or a Geysers Entity and shall satisfy the requirements of a
“Transferee” under Section 7.1 of the Participation Agreement. Upon such designation, TPC shall
deliver to Seller an agreement by Purchaser to be bound by the provisions of Sections 7.1,
7.2.1 and 7.4, Articles 8 and 9, and any other provision of this Agreement that
expressly provides for Purchaser to be bound by or to perform or observe any obligation, as if it
were a “Party” to this Agreement.
2.2 Designation Right Period. The Designation Right shall begin on the Effective Date and
expire as of 5:00 p.m. prevailing Eastern time on the Designation Right Expiration Date, unless the
Designation Right is terminated earlier by written notice from TPC to Seller, given in its sole and
absolute discretion, or by Seller pursuant to Section 2.8. The period commencing on the
Effective Date, and continuing until the Designation Right Expiration Date, shall be referred to
herein as the “Designation Right Period.”
2.3 Designation Right Consideration. The consideration for the Designation Right shall be an
amount equal to $8,000,000 (the “Designation Right Consideration”), which upon execution of this
Agreement shall be paid to Seller by certified check or wire transfer of immediately available
funds without any
deduction, offset or withholding (other than withholding Taxes imposed as a collections
mechanism for United States income Taxes). The Designation Right Consideration shall be
non-refundable to TPC except in the event of Seller’s default hereunder or in the event the
condition in Section 4.4.8 is not satisfied due to matters solely within Seller’s control.
If this Agreement terminates for any reason other than a default of
9
Seller hereunder or the failure
of the condition in Section 4.4.8 to be satisfied due to matters solely within Seller’s
control, (i) Seller shall have no obligation to reimburse TPC for any portion of the Designation
Right Consideration, and (ii) TPC will have no obligation or liability under this Agreement other
than forfeiture of the Designation Right Consideration. The Seller shall be entitled to retain the
Designation Right Consideration in any such event as liquidated damages for loss of its bargain,
including, as a result of the suspension and forbearance of its marketing activities with respect
to the Owner Participant Interests during the Designation Right Period and the incurring of legal
fees and other costs and expenses incurred by Seller in connection with the transactions
contemplated hereby. TPC and Seller agree that Seller’s retention of the Designation Right
Consideration under said circumstances is just, fair and reasonable compensation for losses and
damages which are difficult to quantify. If Purchaser exercises the Purchase Right and purchases
the Owner Participant Interests, the Designation Right Consideration shall not be applied to the
Purchase Price.
2.4 Exclusivity. During the Designation Right Period, unless and until this Agreement is
terminated by Seller pursuant to Section 2.8, Seller shall not, and shall cause its
members, subsidiaries, directors, officers, employees, agents, consultants, advisors and legal
counsel not to, directly or indirectly, make, submit, solicit or respond to an alternative proposal
for the purchase and sale of the Owner Participant Interests or any other transaction which could
reasonably be expected to delay, impede or frustrate the consummation of the transactions
contemplated by the Transaction Documents.
2.5 Designation. TPC shall notify Seller of its designation of the Purchaser hereunder within
two (2) Business Days of such designation, and in any event prior to the Purchaser’s submittal of
an Election Notice as described in Section 2.6 below. At any time prior to the Designation
Right Expiration Date, TPC may, in its sole and absolute discretion, rescind its designation of the
Purchaser, in which case the Designation Right shall continue to survive in full force and effect
for the balance of the Designation Right Period as if TPC had not made such designation and TPC may
subsequently designate another Purchaser meeting the requirements of Section 7.1 of the
Participation Agreement (it being understood that TPC may subsequently re-designate as Purchaser
the same Person with respect to whom it previously rescinded its designation as Purchaser).
2.6 Exercise. Upon its designation, Purchaser, at its sole and absolute discretion, may
exercise the Purchase Right (subject to Section 2.7 below) at any time during the
Designation Right Period by giving Seller written notice of its election to exercise the Purchase
Right (an “Election Notice”)
specifying a Closing Date which shall occur no later than the Designation Right Expiration
Date and no sooner than two (2) Business Days after the date of the Election Notice. At any time
prior to Closing, Purchaser may, in its sole and absolute discretion, rescind an Election Notice,
in which case the Purchase Right shall continue to survive in full force and effect for the balance
of the Designation Right Period as if Purchaser had not exercised the same.
2.7 Expiration of Purchase Right. Unless an Election Notice has been given by Purchaser at
least two (2) Business Days prior to the Designation Right Expiration Date, this Agreement shall
terminate at 5:00 p.m., prevailing Eastern time, on the Designation Right Expiration Date.
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2.8 Seller Termination Right. Upon (i) the occurrence and during the existence of a Seller
Termination Triggering Event or (ii) the failure of TPC or its Affiliates to comply with clause (y)
of the last sentence of Section 7.1, at the option of Seller exercised by written notice to
TPC, GPC and any Purchaser then designated pursuant to this Agreement, this Agreement shall
terminate and neither TPC nor any Purchaser shall have any further rights hereunder, including, in
the case of TPC, to exercise the Designation Right or, in the case of Purchaser, to exercise the
Purchase Right. For the avoidance of doubt, upon any such termination, Seller shall be entitled to
retain the Designation Right Consideration.
ARTICLE 3
TERMS AND CONDITIONS OF PURCHASE AND SALE TRANSACTION
3.1 Sale and Purchase of Owner Participant Interests. Upon Purchaser’s delivery of an
Election Notice, Seller shall sell, transfer and assign to Purchaser the Owner Participant
Interests, and Purchaser shall purchase and acquire the Owner Participant Interests on the terms
and conditions set forth herein.
3.2 Purchase Price. The aggregate consideration to be paid at Closing to Seller for the Owner
Participant Interests shall be One Hundred and Fifty-Seven Million Dollars ($157,000,000) plus, if
Closing occurs after December 31, 2005 but on or before the Designation Right Expiration Date, an
additional Sixteen Thousand Six Hundred Sixty-Six Dollars ($16,666) per day for each day from and
including January 1, 2006 through and including the Closing Date (the “Purchase Price”). The
Designation Right Consideration will not be credited against the Purchase Price.
3.3 Parties to Bear Own Expenses. Whether or not the purchase and sale of the Owner
Participant Interests is consummated and except as otherwise provided for herein, TPC shall bear
its expenses and Seller shall bear its expenses relating to or arising out of this Agreement,
including, but not limited to, fees for attorneys, accountants and other advisors. TPC shall pay
all fees and expenses relating to (x) any of the transactions or matters specified in Section
7.3 and (y) any Governmental Approvals required to be obtained in connection with this
Agreement or the consummation of the transactions contemplated hereby.
ARTICLE 4
CLOSING AND CLOSING CONDITIONS
4.1 Time and Place of the Closing. Subject to the terms and conditions hereof and the
satisfaction or waiver of the closing conditions set forth in this Article 4 (or the
election by either Purchaser or Seller to close notwithstanding the failure of one or more of such
conditions as provided in Section 4.5), in the event of delivery of the Election Notice,
the closing of the transactions contemplated by Article 3 (the “Closing”) shall take place
at the offices of Xxxxxx Xxxx & Priest LLP, located at 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx, on the date specified in the Election Notice or at such other place and on such
other date as Seller and
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Purchaser may mutually agree (the actual date of the Closing is referred to herein as the
“Closing Date”).
4.2 Actions at the Closing. At the Closing, Seller and Purchaser (as applicable) shall take
or cause to be taken the following actions (the “Closing Actions”):
4.2.1 Transfer of Owner Participant Interests. Upon receipt of the Purchase Price by Seller,
Seller shall execute and deliver to Purchaser, and Purchaser shall execute and deliver to Seller,
the Assignment and Assumption Agreement.
4.2.2 Payment of Purchase Price. Purchaser shall pay or cause to be paid the Purchase Price
to Seller without any deduction, offset or withholding (other than withholding Taxes imposed as a
collections mechanism for United States income Taxes), which payment shall be treated for all
purposes as a payment for the Owner Participant Interests.
4.2.3 Nonforeign Certificate. Seller shall furnish Purchaser with a certificate,
substantially in the form of Exhibit C hereto, which satisfies the requirements of Section
1445(b)(2) of the Code.
4.2.4 Additional Actions. Seller and Purchaser shall execute and deliver, or cause to be
executed and delivered, all other documents, and take such other actions, in each case as shall be
necessary or appropriate, to consummate the transactions contemplated hereby, all in accordance
with the provisions of this Agreement and Section 7.1 of the Participation Agreement.
4.3 Conditions Precedent to Obligations of Purchaser. Following the delivery of the Election
Notice, the obligation of Purchaser to consummate the purchase of the Owner Participant Interests
shall be subject to the satisfaction, on or prior to the Closing, of the following conditions
precedent, any of which may be waived by Purchaser in its sole discretion:
4.3.1 Performance of Closing Actions. Seller shall have tendered performance of its
applicable Closing Actions.
4.3.2 No Violation. The consummation of the purchase of the Owner Participant Interests by
Purchaser at the Closing shall not violate any applicable Law, except for violations which would
not reasonably be expected to have a material adverse effect on the business, assets, results of
operation, or financial condition of Purchaser.
4.3.3 Approvals and Consents. All Governmental Approvals and consents of third parties
specifically identified on Schedules 5.1.4 and 6.1.4 shall have been obtained, made
or filed, as the case may be.
4.3.4 No Proceeding or Litigation. No suit, action, investigation, inquiry or other legal or
administrative proceeding by any Governmental Person or other Person shall have been instituted or
threatened which questions or challenges the validity of, or seeks to enjoin, the consummation of
the transactions contemplated by the Transaction Documents or which challenges Seller’s title to or
asserts an ownership interest in or Lien on the Owner Participant Interests.
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4.3.5 Representations, Warranties and Covenants. The representations and warranties of Seller
made hereunder shall be true and correct as of the Closing Date in all material respects. The
covenants and obligations of Seller hereunder, to be complied with on or prior to the Closing,
shall have been complied with in all material respects.
4.3.6 Officer’s Certificates. Seller shall have furnished (a) an officer’s certificate from
Seller, dated as of the Closing Date and signed by a duly authorized officer of Seller, certifying
that the representations and warranties given by Seller in Section 5.1 are true and correct
in all material respects as of the Closing Date, and (b) a secretary’s certificate from Seller,
dated as of the Closing Date and signed by its secretary, certifying as to its incumbent officers,
good standing and due authorization.
4.3.7 Legal Opinion. Purchaser shall have received an opinion of counsel from counsel to
Seller in form and substance reasonably satisfactory to Purchaser with respect to the matters
described in Sections 5.1.1, 5.1.2, 5.1.3 and 5.1.5(a) and the corresponding provisions of
the Assignment and Assumption Agreement.
4.3.8 Participation Agreement. All conditions precedent to the transfer of the Owner
Participant Interests contained in Section 7.1 of the Participation Agreement shall have been
satisfied.
4.3.9 Lessor Notes. Purchaser shall have received a fully executed binding agreement from the
Lease Indenture Trustee (as defined in the Lease Indenture) and each of the Lenders for a
redemption of all of the outstanding Notes (as defined in the Lease Indenture) on the terms and
conditions set forth in the letter agreement attached hereto as Exhibit D (or with such
changes as Seller and TPC shall agree to) or Purchaser shall be satisfied in its discretion that
the Notes can be refinanced and subsequently redeemed in a timely manner without the consent of the
Lease Indenture Trustee, any Lender or any other party which has not been obtained and is in full
force and effect.
4.4 Conditions Precedent to Obligations of Seller. Following the delivery of the Election
Notice, the obligation of Seller to consummate the sale of the Owner Participant Interests shall be
subject to the satisfaction, on or prior to the Closing, of the following conditions precedent, any
of which may be waived by Seller in its sole discretion:
4.4.1 Performance of Closing Actions. Purchaser shall have tendered performance of its
applicable Closing Actions.
4.4.2 No Violation. The consummation of the sale of the Owner Participant Interests by Seller
at the Closing shall not violate any applicable Law, except for violations which would not
reasonably be expected to have a material adverse effect on the business, assets, results of
operation or financial condition of Seller.
4.4.3 Approvals and Consents. All Governmental Approvals and consents of third parties
specifically identified on Schedules 5.1.4 and 6.1.4 shall have been obtained, made
or filed, as the case may be.
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4.4.4 No Proceeding or Litigation. No suit, action, investigation, inquiry or other legal or
administrative proceeding by any Governmental Person or other Person shall have been instituted or
threatened which questions or challenges the validity of, or seeks to enjoin, the consummation of
the transactions contemplated by the Transaction Documents or which challenges Seller’s title to or
asserts an ownership interest in or Lien on the Owner Participant Interests.
4.4.5 Representations, Warranties and Covenants. The representations and warranties of TPC
and GPC made hereunder and the representations and warranties of Purchaser to be made pursuant to
the Assignment and Assumption Agreement shall be true and correct in all material respects as of
the Closing Date; provided, however, if TPC’s or GPC’s corresponding representations made
pursuant to Sections 6.1.6 or 6.1.8 or GPC’s representation in Section 6.2 is not
true as of the Closing Date, but TPC and/or GPC, as applicable, has obtained an order of the
Bankruptcy Court approving the transactions contemplated hereby, any inaccuracy of such
representation shall be deemed waived by Seller. The covenants and obligations of TPC, GPC and
Purchaser hereunder, to be complied with on or prior to the Closing, shall have been complied with
in all material respects.
4.4.6 Officer’s Certificates. TPC shall have furnished to Seller (a) officer’s certificates
from TPC and Purchaser, dated as of the Closing Date and signed by duly authorized officers of TPC
and Purchaser, as applicable, certifying that the representations and warranties given by TPC in
Section 6.1 and by Purchaser in Section 6 of the Assignment and Assumption Agreement, as
applicable, are true and correct in all material respects as of the Closing Date, and (b)
secretary’s certificates from TPC and Purchaser, dated as of the Closing Date and signed by its
secretary, certifying as to its incumbent officers, good standing and due authorization.
4.4.7 Legal Opinion. Seller shall have received opinions of counsel from counsel to TPC, GPC
and Purchaser in form and substance reasonably satisfactory to Seller with respect to the matters
described in Sections 6.1.1, 6.1.2, 6.1.3 and 6.1.5(a) (in the case of GPC and TPC) and the
corresponding provisions of the Assignment and Assumption Agreement (in the case of Purchaser).
4.4.8 Participation Agreement. All conditions precedent to the transfer of the Owner
Participant Interests contained in Section 7.1 of the Participation Agreement and Section 11.17 of
the Trust Agreement shall have been satisfied.
4.5 Failure of Conditions. If one or more of the conditions precedent in Sections 4.3
or 4.4 of this Agreement are not satisfied as of the date scheduled for Closing in the
Election Notice, the party benefited by such condition(s) (Purchaser with respect to the conditions
precedent in Section 4.3 and Seller with respect to the conditions precedent in Section
4.4) may, at its option, elect to (a) terminate this Agreement, (b) close the transactions
contemplated hereby notwithstanding the failure of such condition(s), or (c) extend the Closing
Date (but in no event to a date later than the Designation Right Expiration Date) in an effort to
allow time for such condition(s) to be satisfied, without in any such case waiving or releasing any
of the rights or remedies it may have hereunder with respect to a breach of any representation,
warranty or covenant by the other party; provided, however, that if the party
benefited by the condition(s) exercises its right to extend the Closing Date and such condition(s)
(or other conditions) are not
14
satisfied as of the extended Closing Date, such party may elect to terminate this Agreement or
close the transactions contemplated hereby notwithstanding the failure of such condition(s), but it
may not further extend the Closing Date without the consent of the other party. Notwithstanding
anything in this Section 4.5 to the contrary, if, following delivery of an Election Notice
by Purchaser, either party becomes aware that a representation or warranty made or to be made by it
pursuant to this Agreement or the Assignment and Assumption Agreement will not be true and correct
as of the date of Closing proposed in the Election Notice, then such party may elect by written
notice to the other party to delay the Closing by no more than ten (10) days (but in no event later
than the Designation Right Expiration Date) in order to attempt to cure such breach.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF SELLER
5.1 Representations and Warranties of Seller. Seller hereby represents and warrants to TPC
and to Purchaser (as a third party beneficiary pursuant to Section 9.12 hereof upon its
designation and execution of its agreement referenced in Section 2.1) that as of the date
of execution of this Agreement:
5.1.1 Organization. Seller is a limited liability company duly organized, validly existing
and in good standing under the Laws of the State of Delaware. Seller is qualified to do business
in all jurisdictions where the failure to qualify would materially and adversely affect its ability
to execute or deliver, or perform its obligations under, the Transaction Documents to which it is
or will be a party.
5.1.2 Authority and Power. Seller has the requisite power and authority to enter into each of
the Transaction Documents to which it is or will be a party, consummate each of the transactions
and undertakings contemplated thereby, and perform all of the terms and conditions thereof to be
performed by it. The execution, delivery and performance of each of the Transaction Documents to
which Seller is or will be a party and the consummation of each of the transactions and
undertakings contemplated thereby have been duly authorized by all requisite action on the part of
Seller.
5.1.3 Valid and Binding Obligations. Each of the Transaction Documents to which Seller is or
will be a party has been, or will be when executed and delivered, duly and validly executed and
delivered by Seller, and is, or will be when executed and delivered, enforceable against Seller in
accordance with the terms thereof, except as such enforceability may be limited or denied by (a)
applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’
rights and the enforcement of debtors’ obligations generally, and (b) general principles of equity,
regardless of whether enforcement is pursuant to a proceeding in equity or at law.
5.1.4 Approvals and Consents. Except as set forth in Schedule 5.1.4, Seller is not,
and will not be, required to give any notice, make any filing, or obtain any consent or approval
(including Governmental Approvals and consents or approvals of any third party) to
15
execute, deliver or perform any of the Transaction Documents to which it is or will be a party
or to consummate the transactions contemplated thereby. No representation is made in this
Section 5.1.4 with respect to any requirement to obtain any approval of FERC with respect
to the transactions contemplated hereby or by any other Transaction Document, including the
transfer by the Seller of the Owner Participant Interests pursuant to the terms hereof.
5.1.5 No Violations. The execution, delivery and performance by Seller of each of the
Transaction Documents to which it is or will be a party does not and will not, and the consummation
of the transactions contemplated thereby will not (a) violate the Charter Documents of Seller; (b)
assuming the accuracy of the representations and warranties of TPC set forth herein and of the
Purchaser set forth in the Assignment and Assumption Agreement, violate or be in conflict with, or
constitute a default (or any event which, with or without due notice or lapse of time, or both,
would constitute a default) under, any Contract to which Seller is a party or by which any of
Seller’s properties or assets are or may be bound, which in any case, would materially and
adversely affect the ability of Seller to perform its obligations under the Transaction Documents
to which it is or will be a party or title to or value of the Owner Participant Interests; or (c)
violate any applicable Law, order, judgment, decree or consent from any Governmental Authority.
5.1.6 No Litigation. There are no actions, suits, or legal or arbitration proceedings pending
to which Seller is a party (and, to Seller’s Knowledge, there are no actions, suits or legal or
arbitration proceedings threatened against Seller), in any such case at law or in equity before any
Governmental Person or arbitral body against or affecting Seller, which actions, suits, or legal or
arbitration proceedings in any such case would reasonably be expected to have a material adverse
effect on (a) the ability of Seller to perform its obligations under the Transaction Documents or
to consummate the transactions contemplated thereby or (b) title to or value of the Owner
Participant Interests or Seller’s rights under the Operative Documents.
5.1.7 Owner Participant Interests. Seller is the sole record and beneficial owner of, and
holds good and valid title to, the Owner Participant Interests free and clear of all Liens and
shall transfer the Owner Participant Interests to Purchaser on the Closing Date free and clear of
all Liens, other than any Liens created by the Operative Documents or the Transaction Documents, or
otherwise created by or through the Purchaser, TPC, GPC or Parent. The Owner Participant Interests
are not subject to any agreements or other arrangements with respect to voting rights or
transferability, and there are no outstanding options, warrants, rights (including conversion or
preemptive rights) or agreements for the purchase or acquisition of any portion of the Owner
Participant Interests or securities convertible or exchangeable for any portion of the Owner
Participant Interests, other than as may have been created by or through Purchaser, TPC, GPC or
Parent.
5.1.8 Brokers’ Fees. No broker, finder, investment banker or other Person is entitled to any
brokerage, finder’s or other fee or commission in connection with this Agreement or the
transactions contemplated hereby, based upon any agreements, arrangements or commitments, written
or oral, made by or on behalf of Seller or its Affiliates, except for fees or commissions that are
solely the obligation of Seller and for which TPC is not liable.
16
5.1.9 Bankruptcy. No Bankruptcy Event has occurred and is continuing with respect to Seller.
5.1.10 No Indebtedness or Liabilities. Owner Lessor has not incurred, and the Ownership
Participant Interests are not subject to, any Indebtedness or other liabilities of any kind other
than the Lease Debt and obligations under the Participation Agreement and the Operative Documents.
5.1.11 United States Person. Seller is a “United States person” within the meaning of Section
7701(a)(30) of the Code.
5.1.12 Operative Documents. Each of the Operative Documents to which Seller is a party is in
full force and effect and enforceable against Seller and has not been amended, modified or
supplemented by Seller (except if so amended, modified or supplemented in accordance with the terms
thereof). Seller has performed in all material respects all obligations required to be performed
by Seller under the Operative Documents. Seller is not in default of any material obligations to
be performed by it or in violation of any material covenant to be observed by it pursuant to any of
the Operative Documents to which it is a party, and Seller does not have Knowledge of any event of
default or of any event of acceleration under any applicable Operative Documents (except to the
extent caused by GPC or any Affiliate thereof), or of any existing condition which, upon the giving
of notice or the lapse of time or both, would constitute an event of default or event of
acceleration under the Operative Documents. There are no agreements, documents or other
correspondence, other than the Operative Documents, relating to the Owner Participant Interests or
any part thereof that have been entered into by Seller which will be binding on or affect TPC or
the Owner Participant Interests on or after the Closing.
5.2 No Further Representations. Except for the representations and warranties expressly set
forth in Article 5 of this Agreement, TPC expressly disclaims any representations or
warranties of any kind, express or implied, relating to Seller, the Guarantor, the Owner Lessor,
the Owner Participant Interests or the transactions contemplated by this Agreement.
IN FURTHERANCE OF THE FOREGOING, TPC ACKNOWLEDGES THAT ANY TRANSFER OF THE OWNER PARTICIPANT
INTERESTS WILL BE EFFECTED WITH RESPECT TO THE FACILITIES IN THEIR “AS IS, WHERE IS” CONDITION, AND
SELLER MAKES NO WARRANTIES, GUARANTEES OR REPRESENTATIONS, EXPRESS OR IMPLIED, ARISING BY LAW OR
OTHERWISE, WITH RESPECT TO THE FACILITIES. TPC WAIVES, RELEASES AND RENOUNCES (1) ANY IMPLIED
WARRANTY AS TO THE DESCRIPTION, MERCHANTABILITY, FITNESS FOR ANY PURPOSE, VALUE, CONDITION, DESIGN,
DATE PROCESSING, USE OR OPERATION OF THE FACILITIES OR ANY PAST PERFORMANCE, COURSE OF DEALING,
USAGE OR TRADE OR OTHERWISE, (2) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT
(INCLUDING STRICT LIABILITY) WITH RESPECT TO THE CONDITION OF THE FACILITIES, AND (3) ANY
OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY OF OR AGAINST SELLER OR GUARANTOR FOR LOSS OF OR
DAMAGE TO THE FACILITIES, FOR ANY LIABILITY OF THE FACILITY LESSEE TO ANY THIRD PARTY, FOR ANY
LIABILITY OF TPC TO ANY THIRD PARTY, OR FOR
17
ANY OTHER DIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES AS A RESULT OF ANY OF THE FOREGOING, AND
ALL SUCH WARRANTIES, GUARANTEES, REPRESENTATIONS, OBLIGATIONS, LIABILITIES, RIGHTS, CLAIMS OR
REMEDIES, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, TO THE EXTENT NOT SET FORTH IN THIS
AGREEMENT, ARE EXPRESSLY EXCLUDED; PROVIDED, HOWEVER, THAT THE FOREGOING DOES NOT LIMIT
SELLER’S REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLE 5 HEREOF OR SELLER’S
OBLIGATIONS AND LIABILITIES EXPRESSLY SET FORTH IN THIS AGREEMENT.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF TPC AND GPC
6.1 Representations and Warranties of TPC. TPC hereby represents and warrants to Seller that
as of the date of execution of this Agreement:
6.1.1 Organization. TPC is duly organized, validly existing and in good standing under the
Laws of its jurisdiction of organization. TPC is qualified to do business in all jurisdictions
where the failure to qualify would materially and adversely affect its ability to execute or
deliver, or perform its obligations under, the Transaction Documents to which it is or will be a
party.
6.1.2 Authority and Power. TPC has the requisite power and authority to enter into each of
the Transaction Documents to which it is or will be a party, consummate each of the transactions
and undertakings contemplated thereby, and perform all of the terms and conditions thereof to be
performed by it. The execution, delivery and performance of each of the Transaction Documents to
which TPC is or will be a party and the consummation of each of the transactions and undertakings
contemplated thereby have been duly authorized by all requisite action on the part of TPC.
6.1.3 Valid and Binding Obligations. Each of the Transaction Documents to which TPC is or
will be a party has been, or will be when executed and delivered, duly and validly executed and
delivered by TPC, and is, or will be when executed and delivered, enforceable against TPC in
accordance with the terms thereof, except as such enforceability may be limited or denied by (a)
applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’
rights and the enforcement of debtors’ obligations generally, and (b) general principles of equity,
regardless of whether enforcement is pursuant to a proceeding in equity or at law.
6.1.4 Approvals and Consents. Except as set forth in Schedule 6.1.4, TPC is not, and
will not be, required to give any notice, make any filing, or obtain any consent or approval
(including Governmental Approvals and consents or approvals of any third party) to execute, deliver
or perform any of the Transaction Documents to which it is or will be a party or to consummate the
transactions contemplated thereby.
6.1.5 No Violations. The execution, delivery and performance by TPC of each of the
Transaction Documents to which it is or will be a party does not and will not, and the
18
consummation of the transactions contemplated thereby will not (a) violate the Charter
Documents of TPC, (b) violate or be in conflict with, or constitute a default (or any event which,
with or without due notice or lapse of time, or both, would constitute a default) under, any
Contract to which TPC is a party or by which any of TPC’s properties or assets are or may be bound,
which in any case, would materially and adversely affect the ability of TPC to perform its
obligations under the Transaction Documents to which it is or will be a party, or (c) violate any
applicable Law, order, judgment, decree or consent.
6.1.6 No Litigation. There are no actions, suits, or legal or arbitration proceedings pending
to which TPC is a party (and, to TPC’s Knowledge, there are no actions, suits or legal or
arbitration proceedings threatened against TPC), in any such case at law or in equity before any
Governmental Person or arbitral body against or affecting TPC, which actions, suits, or legal or
arbitration proceedings in any such case would reasonably be expected to have a material adverse
effect on the ability of TPC to perform its obligations under the Transaction Documents or to
consummate the transactions contemplated thereby.
6.1.7 Brokers’ Fees. No broker, finder, investment banker or other Person is entitled to any
brokerage, finder’s or other fee or commission in connection with this Agreement or the
transactions contemplated hereby, based upon any agreements, arrangements or commitments, written
or oral, made by or on behalf of TPC or its Affiliates, except for fees or commissions that are
solely the obligation of TPC and for which Seller is not liable.
6.1.8 Bankruptcy. No Bankruptcy Event has occurred and is continuing with respect to TPC.
6.1.9 Geysers Entities. Each Geysers Entity is, directly or indirectly, a wholly owned
Subsidiary of Parent.
6.2 Representations and Warranties of GPC. GPC represents and warrants to Seller that, as of
the date of execution of this Agreement, the representations set forth in Sections 6.1.1
through 6.1.8 are true and correct as to itself; provided that all references thereunder to
“TPC” shall be deemed to be references to “GPC” for purposes of this Section 6.2.
Additionally, GPC represents and warrants to Seller that, as of the date of execution of this
Agreement, there currently exists no Lease Default (as defined in the Participation Agreement) or
Lease Event of Default.
6.3 No Further Representations. Except for the representations and warranties expressly set
forth in Article 6 of this Agreement, Seller expressly disclaims any representations or
warranties of any kind, express or implied, relating to TPC, GPC or the transactions contemplated
by this Agreement.
ARTICLE 7
COVENANTS
7.1 Consummation of Transactions and Obtaining Approvals. From and after the date of
execution of this Agreement, each Party shall (a) as promptly as is reasonably
19
practicable, diligently and in good faith use all commercially reasonable efforts to cause the
Closing conditions in this Agreement to be satisfied, and (b) coordinate and cooperate (in a
commercially reasonable manner) with each other in providing such information and supplying such
assistance as may be reasonably requested by such other parties in connection with the foregoing.
No Party will take or fail to take any actions from the Effective Date through the Closing Date
that could reasonably be expected to prevent, impair or delay satisfaction of such Closing
conditions. Without limiting the generality of the foregoing, (x) each Party shall use all
commercially reasonable efforts to obtain all authorizations, consents, orders, and approvals of,
and to give all notices to and make all filings with, all Governmental Persons (including those
pertaining to the Governmental Approvals) and third parties that may be or become necessary for its
performance of its obligations under this Agreement and shall cooperate fully with the other Party
in promptly seeking to obtain all such authorizations, consents, orders, and approvals, giving such
notices, and making such filings, and (y) TPC shall, or shall cause Parent and/or its Affiliates
(as applicable) to, file all necessary and appropriate motions to the Bankruptcy Court seeking
approval of this Agreement and the matters set forth in Schedule 6.1.4 (except for FERC
Approval, should FERC Approval become necessary) by January 15, 2006.
7.2 Tax Matters.
7.2.1 Like-Kind Exchange. Seller may decide to structure the transaction contemplated by this
Agreement as an exchange qualifying for nonrecognition treatment under Section 1031 of the Code
(the “Exchange”). TPC (and, following its designation, Purchaser) agrees to cooperate in directing
any payments of the Purchase Price under this Agreement and executing any documents as may be
reasonably requested by Seller to effect the Exchange.
7.2.2 Allocation of Income. Unless otherwise required under the Code or the regulations
thereunder, items of income, gain, loss, deduction and credit of the Owner Participant Interests
for the Pre-Closing Period shall be for the account of the Seller and for the Post-Closing Period
shall be for the account of the Purchaser.
7.2.3 Tax Returns.
7.2.3.1 Seller shall timely prepare and file (or cause to be timely prepared and filed) with
the appropriate authorities all Tax Returns required to be filed by it with respect to the Owner
Participant Interests, the Owner Lessor or the Trust Estate for Taxes (if any) for periods ending
on or before the Closing Date for which Seller is liable pursuant to the following sentence. Other
than with respect to Taxes for which Seller is indemnified against pursuant to the terms of the
Operative Documents or this Agreement, Seller shall pay or cause to be paid all Taxes with respect
to the Owner Participant Interests, the Owner Lessor or the Trust Estate relating to the
Pre-Closing Period, regardless of whether or not the filing period to which such Taxes relate ends
before or after the Closing Date.
7.2.3.2 TPC shall itself or shall cause Purchaser to timely prepare and file with the
appropriate authorities all Tax Returns required to be filed by it with respect to the Owner
Participant Interests, the Owner Lessor or the Trust Estate that Seller is not required to prepare
and file in accordance with Section 7.2.3.1 above. Other than with respect to Taxes for
which TPC is indemnified against pursuant to the terms of the Operative Documents or this
20
Agreement, TPC shall cause Purchaser to pay or cause to be paid all Taxes with respect to the
Owner Participant Interests, the Owner Lessor or the Trust Estate relating to the Post-Closing
Period, regardless of whether or not the filing period to which such Taxes relate begins before or
after the Closing Date.
7.2.4 Refunds. Any Tax refund (including any interest with respect thereto) attributable to
the Owner Participant Interests for a taxable period (or portion thereof) ending on or prior to the
Closing Date (unless required to be paid to Facility Lessee pursuant to the Operative Documents)
shall be the property of Seller, and if received by Purchaser, shall be promptly paid over to
Seller. Similarly, any Tax refund attributable to the Owner Participant Interests for a taxable
period (or portion thereof) beginning on or after the Closing Date shall be the property of
Purchaser, and if received by Seller, shall be promptly paid over to Purchaser.
7.2.5 Audits and Other Contests. If (a) a notice of deficiency, proposed adjustment,
adjustment, assessment, audit, examination or other administrative or court proceeding, suit,
dispute or other claim is delivered, sent to, or commenced or initiated against either Seller or
Purchaser with respect to the Owner Participant Interests, by any Taxing Authority with respect to
Taxes for which such party may be entitled to indemnification from the other party pursuant to
Section 8.1, and (b) the first party intends to seek indemnity with respect thereto under
Section 8.1, then such party, as the Indemnified Party, shall promptly notify the other
party, as the Indemnitor, in writing as soon as reasonably practical (but in no event more than
thirty (30) days) after Indemnified Party’s receipt of notice, and Indemnitor shall be entitled to
defend such matters as provided in Section 8.1. Indemnified Party shall cooperate with
Indemnitor by giving Indemnitor and its representatives, on prior reasonable notice, access during
normal business hours to all information, books and records in Indemnified Party’s (or any of its
Affiliates’) possession and control pertaining to Taxes (other than Tax Returns or other
confidential information) for the relevant period with respect to the Owner Participant Interests.
7.2.6 Cooperation. Seller and TPC shall reasonably cooperate, and shall cause their
respective Affiliates, officers, employees, agents, auditors and representatives reasonably to
cooperate, and TPC shall cause Purchaser to reasonably cooperate, in preparing and filing all Tax
Returns relating to the Owner Participant Interests, including maintaining and making available to
each other all records necessary in connection with Taxes and in resolving all disputes and audits
with respect to all taxable periods relating to Taxes. TPC recognizes that Seller may need access,
from time to time after the Closing Date, to certain accounting and Tax records related to the
Owner Participant Interests and information held by TPC, its Affiliates or Purchaser, and
accordingly, TPC shall, and shall cause each of its Affiliates and Purchaser, (a) to properly
retain and maintain such records for the shorter of three (3) years or until such time as Seller
agrees that such retention and maintenance is no longer necessary, (b) to permit Seller and its
representatives reasonable access at reasonable times to such records, and (c) to execute such
documents as Seller may reasonably request to enable Seller to file any required reports or Tax
Returns relating to the Owner Participant Interests.
7.2.7 Transfer Taxes. It is understood and agreed that TPC shall pay (and following
Purchaser’s designation, TPC and Purchaser jointly and severally agree to pay) all Taxes, other
than Taxes imposed on the gross or net income, receipts or capital gain (or similar Taxes) of
Seller, if any, arising out of or in connection with this Agreement, including, without
21
limitation, sales, use, transfer, real property transfer, recording, gains, stock transfer and
other similar taxes and fees (“Transfer Taxes”). TPC shall prepare and timely file (or shall cause
Purchaser to so prepare and file) all Tax Returns or other documentation relating to such Transfer
Taxes. TPC shall provide (or shall require Purchaser to provide) Seller with copies of each such
Tax Return or other document at least thirty (30) days prior to the date on which such Tax Return
or other document is required to be filed.
7.2.8 GPC Acknowledgement. GPC agrees that the provisions of Section 7.1(c) of the
Participation Agreement shall not be applicable in connection with this Agreement or any of the
transactions contemplated hereby. GPC also agrees that entering into this Agreement and any of the
transactions contemplated hereby shall be deemed to constitute a “Lessee Action” for purposes of
the Third Amended and Restated Tax Indemnity Agreement (the “TIA”), and that Section 5(d)(i) of the
TIA shall be inapplicable with respect hereto, but only to the extent that the Taxes imposed on
Seller exceed the Taxes on disposition that would have been imposed had Seller directly and
immediately transferred the Owner Participant Interests to a third party unaffiliated with GPC.
7.3 Optional Prepayment or Refinancing. Seller, upon the request of TPC and/or Purchaser,
shall reasonably cooperate with such request (i) to effect an optional prepayment pursuant to
Section 2.10(d)(i)(2)(B) of the Lease Indenture, (ii) to effect an optional refinancing pursuant to
Sections 11.2 and 11.3 of the Participation Agreement and Section 2.10 and 2.12 of the Lease
Indenture, or (iii) to otherwise prepay the outstanding Indebtedness under the Lease Indenture in
full; provided that (A) any such actions shall be at the sole cost and expense of TPC and
(B) any such prepayment or refinancing shall not be effective until immediately following the
transfer of the Owner Participant Interests contemplated hereby. Without limiting the generality
of the foregoing, Seller will cooperate with the reasonable requests of TPC to prepay or refinance
the Lease Debt in full, including exercising such rights and remedies as Seller may have under the
Transaction Documents (as defined in the Participation Agreement) to enable TPC or Purchaser to
prepay or refinance the Lease Debt in full, so long as the requirements in the proviso to the
previous sentence are satisfied. TPC agrees to indemnify and hold harmless (and following
Purchaser’s designation, TPC and Purchaser jointly and severally agree to indemnify and hold
harmless) Seller from and against any adverse consequences (including any Tax consequences)
resulting from or attributable to any actions taken by Seller pursuant to this Section 7.3.
7.4 Conduct During Designation Right Period. Except as otherwise contemplated in this
Agreement, from the Effective Date through the earlier of the Closing Date or the date of
termination of this Agreement:
(a) Seller shall not incur any Indebtedness, obligations or liabilities other than the Lease
Debt and obligations under the Operative Documents which could reasonably be expected to delay,
impede or frustrate the consummation of the transactions contemplated by the Transaction Documents,
or negotiate with any Person to do so;
(b) Seller shall not permit or suffer to exist any Lien upon the Owner Participant Interests;
22
(c) neither Party nor GPC or Purchaser shall take any action or omit to take any action that
would render any representation or warranty made by Seller under this Agreement untrue, inaccurate,
incomplete or misleading in any material respect;
(d) Seller shall not sell, assign, transfer or grant any rights or options with respect to the
purchase of all or any part of the Owner Participant Interests to any Person, nor shall either
Party, GPC or Purchaser enter into any other transaction which could reasonably be expected to
delay, impede or frustrate the Closing, or negotiate with any Person to do so;
(e) Seller shall not make any assignment of revenues or tax or other elections that are
binding or effective after the Closing Date;
(f) neither Seller nor GPC shall enter into (and Seller shall not allow the Owner Trustee to
enter into) any amendment of the Participation Agreement or the Operative Documents without the
prior written consent of Seller or GPC, as applicable; and
(g) neither Party nor GPC or Purchaser shall negotiate or enter into any agreements to do any
of the foregoing, as applicable.
7.5 Forbearance. Except as otherwise expressly provided herein, from the Effective Date
through the earlier of the Closing Date or the date of termination of this Agreement, unless and
until the Lenders seek to declare a Lease Indenture Event of Default or to accelerate the maturity
of the Lease Debt and exercise remedies under the Lease Indenture or the other Collateral Documents
as the result of a Bankruptcy Event affecting Parent or any Affiliate of Parent (including TPC),
Seller shall not, and shall not authorize, direct or permit Owner Lessor to, declare a Lease Event
of Default, terminate or attempt to terminate the Facility Lease, or exercise or attempt to
exercise any remedies under the Facility Lease, the Pledge Agreement, the Stock Pledge Agreement or
any other Operative Document solely as the result of a Bankruptcy Event affecting Parent or any
Affiliate of Parent (including TPC). In the event the Lenders do seek to declare a Lease Indenture
Event of Default or to accelerate the maturity of the Lease Debt and exercise remedies under the
Lease Indenture or the other Collateral Documents as the result of a Bankruptcy Event affecting
Parent or any Affiliate of Parent (including TPC), Seller shall, to the extent practicable, consult
and cooperate with TPC regarding the exercise of Seller’s rights and remedies and the taking of
such other steps as may be appropriate to cause the closing conditions in this Agreement to be
satisfied and to have the Closing occur, but Seller shall be entitled to exercise, and to
authorize, direct and permit Owner Lessor to exercise, such rights and remedies under the Facility
Lease, the Pledge Agreement, the Stock Pledge Agreement and the other Operative Documents as Seller
believes in good faith are necessary to protect its interests under the Facility Lease and the
other Operative Documents.
ARTICLE 8
INDEMNIFICATION
8.1 General. To the fullest extent permitted by applicable Law, each Party (in such capacity,
an “Indemnitor”), shall defend, indemnify and hold harmless the other Party and its Affiliates, and
their respective directors, officers, partners, managers, members, shareholders,
23
employees, consultants, agents, representatives, advisors, successors and assigns (each, an
“Indemnified Party,” with each Party and its respective group of Indemnified Parties being referred
to collectively as an “Indemnified Group”) from and against any Loss suffered or incurred by any
Indemnified Party to the extent arising out of, or resulting from (a) the inaccuracy of any
representation or warranty of the Indemnitor (or any Affiliate thereof) contained in the
Transaction Documents, or in any certificate delivered in connection herewith at the Closing or (b)
the breach or default by the Indemnitor (or any Affiliate thereof) of any covenant or agreement of
such Indemnitor contained in the Transaction Documents. No Indemnified Party shall be entitled to
any indemnification hereunder in respect of any Loss to the extent caused by the willful misconduct
or failure to perform obligations under the Transaction Documents of such Indemnified Party or any
Person who is a member of its Indemnified Group. In no event shall the liability of the Indemnitor
hereunder exceed $8,000,000 prior to Closing and $165,000,000 thereafter.
8.2 Survival of Representations and Warranties. All representations and warranties made
herein, and the agreements set forth herein, shall survive the Closing and continue forever
thereafter, except for the representations and warranties made pursuant to Sections 5.1.4 (with
respect to Governmental Approvals only), 5.1.5(c), 5.1.6, 5.1.8, 5.1.9 and 5.1.12, which shall
survive for a one year period following the Closing.
8.3 Procedure for Indemnification with Respect to Third-Party Claims.
8.3.1 Notice of Claim. If any legal proceedings shall be instituted or any claim or demand
shall be asserted by any third party in respect of which indemnification may be sought by any
Indemnified Party under this Article 8, such Indemnified Party shall, within thirty (30)
days of the actual receipt thereof by a responsible officer, cause written notice of such legal
proceedings or the assertion of such claim or demand to be forwarded to the Indemnitor, specifying
the nature of such legal proceedings, claim or demand and the amount or the estimated amount
thereof to the extent then feasible, which estimate shall not be binding upon the Indemnified
Party, in its effort to collect the final amount arising out of such legal proceedings, claim or
demand; provided, that the failure of an Indemnified Party to give timely notice shall not affect
its rights to indemnification under this Article 8 except to the extent that the Indemnitor
has been actually damaged by such failure.
8.3.2 Conduct of Claim. The Indemnitor shall have the right, at its option and at its own
expense, to be represented by counsel of its choice reasonably acceptable to the Indemnified Party
and to participate in, or take control of, the defense, negotiation and/or settlement of any
proceeding, claim or demand that relates to any amounts indemnifiable or potentially indemnifiable
under this Article 8; provided, that the Indemnified Party may participate in any such
proceeding with counsel of its choice, which shall be at its own expense; and provided further,
that the Indemnified Party may designate counsel, to be paid for by the Indemnitor, if (a) the
Indemnitor does not pursue with reasonable diligence such defense, negotiation or settlement, or
(b) in the reasonable opinion of such Indemnified Party and its counsel, such action, suit or
proceeding involves the potential imposition of criminal liability upon such Indemnified Party or a
conflict of interest between such Indemnified Party and the Indemnitor. The Indemnified Party
shall have a right to notice of any settlement, and the Indemnitor shall not execute or otherwise
agree to any consent decree that (x) provides for other
24
than monetary payment without the Indemnified Party’s prior written consent, which consent
shall not be unreasonably withheld or (y) does not include as an unconditional term thereof the
giving of a release from all liability with respect to such claim by each claimant or plaintiff to
each Indemnified Party that is or may be subject to the third-party claim, without the Indemnified
Party’s prior written consent, which consent shall not be unreasonably withheld. Notwithstanding
the foregoing, (i) the Indemnified Party can request that the Indemnitor settle any such claims,
actions, suits or proceedings, which request shall not be unreasonably refused by the Indemnitor,
and (ii) the Indemnified Party shall have the right to settle any claims, actions, suits or
proceedings that in the reasonable opinion of such Indemnified Party involve the potential
imposition of criminal liability upon the Indemnified Party or materially and adversely affect the
ownership, operation or financing of the Facilities. If the Indemnitor elects not to defend or
settle such proceeding, claim or demand and the Indemnified Party defends, settles or otherwise
deals with any such proceeding, claim or demand directly, the Indemnified Party shall act
reasonably and in accordance with the Indemnified Party’s good faith business judgment, but the
Indemnitor shall be responsible for all costs and expenses paid or incurred by the Indemnified
Party in connection with such settlement. The Indemnitor and the Indemnified Party shall cooperate
fully with each other in connection with the defense, negotiation or settlement of any such legal
proceeding, claim or demand. Any claim for indemnification with respect to Taxes shall be further
subject to the provisions in Section 7.2, and, to the extent there is any inconsistency
between the specific provisions of Section 7.2 and this Section 8.3, the provisions
in Section 7.2 shall govern.
8.3.3 Payment of Claim. After final judgment or award shall have been rendered by a court,
arbitration board or administrative agency of competent jurisdiction and the expiration of the time
in which to appeal therefrom, or a settlement shall have been consummated, or the Indemnified Party
and the Indemnitor shall have arrived at a mutually binding agreement with respect to each separate
matter indemnified by the Indemnitor, the Indemnified Party shall forward to the Indemnitor notice
of any sums due and owing by the Indemnitor with respect to such matter, and the Indemnitor shall
pay all of the sums so owing to the Indemnified Party in immediately available funds within twenty
(20) days after the date of such notice.
8.3.4 Access to Information. If any claim is made by a third party against an Indemnified
Party, the Indemnified Party shall use commercially reasonable efforts to make available to the
Indemnitor those partners, members, officers and employees whose assistance, testimony or presence
is necessary to assist the Indemnitor in evaluating and in defending such claims; provided, that
any such access shall be conducted in such a manner as not to interfere unreasonably with the
operations of the business of the Indemnified Party, and any out of pocket expenses incurred by any
Indemnified Party in connection therewith shall be included in such Indemnified Party’s Losses.
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ARTICLE 9
MISCELLANEOUS
9.1 Notices. Any notice, statement, demand, claim, offer or other written instrument required
or permitted to be given pursuant to this Agreement shall be in writing signed by the Party giving
such notice and shall be sent by facsimile, hand messenger delivery, overnight courier service, or
certified mail (receipt requested) to each other Party at the address set forth below:
(a) | If to Seller, to it at: |
Steam Heat LLC
c/o Verizon Capital Corp.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Asset Administrator
Facsimile: (000) 000-0000
c/o Verizon Capital Corp.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Asset Administrator
Facsimile: (000) 000-0000
With a copy to:
Fulbright & Xxxxxxxx L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
(c) | If to TPC, to it at: |
Thermal Power Company
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Vice President, Asset Management
Facsimile: (000) 000-0000
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Vice President, Asset Management
Facsimile: (000) 000-0000
With a copy to:
Calpine Corporation
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
Each Party shall have the right to change the place to which notices shall be sent or
delivered or to specify one additional address to which copies of notices may be sent, in either
case by similar notice sent or delivered in like manner to each other Party. Without limiting any
26
other means by which a Party may be able to prove that a notice has been received by another Party,
all notices and communications shall be deemed to have been duly given: (i) at the time delivered
by hand, if personally delivered; (ii) two (2) Business Days after being deposited in the mail,
postage prepaid, if mailed by first class certified mail, receipt requested; (iii) when received,
if sent by facsimile, if received prior to 5:00 p.m., recipient’s time, on a Business Day, or on
the next Business Day, if received later than 5:00 p.m., recipient’s time, and (iv) when received,
if sent by courier or other private delivery service. In any case hereunder in which a Party is
required or permitted to respond to a notice from another Party within a specified period, such
period shall run from the date on which the notice was deemed duly given as above provided, and the
response shall be considered to be timely given if given as above provided by the last day of the
period provided for such response.
9.2 Entire Agreement; Amendments. This Agreement and the other Transaction Documents
constitute the entire agreement and supersede all prior agreements and understandings, both written
and oral, of the Parties with respect to the subject matter hereof. Any oral representations or
modifications concerning this instrument shall be of no force or effect unless contained in a
subsequent written modification signed by the party to be charged. This Agreement may be amended
or modified only by a written instrument executed by the Parties.
9.3
Successors and Assigns.
This Agreement and the other Transaction Documents shall be binding upon, and shall inure
to the benefit of, and shall be enforceable by, the Parties and their respective successors and
assigns. Except as provided in Section 2.1, neither Party may assign either this Agreement
or any of its rights, interests and obligations hereunder without the prior written approval of the
other Party.
9.4 Currency Matters. U.S. Dollars shall be the currency of account in the case of all
obligations arising under or relating to this Agreement.
9.5 Governing Law. This Agreement, and any instrument or agreement required hereunder (to the
extent not otherwise expressly provided for therein), shall be governed by, and construed under,
the laws of the State of New York, without reference to conflicts of laws rules (other than Section
5-1401 of the New York General Obligations Law).
9.6 Consent to Jurisdiction. The Parties agree that any suit, action or other legal
proceeding by or against any Party (or its Affiliates or designees) with respect to or arising out
of this Agreement or any other Transaction Document shall be brought exclusively in the United
States District Court for the Southern District of New York or the courts of the State of New York,
in the City of New York, as the Party instituting such suit, action or other legal proceeding may
elect, except that actions to enforce an interim or final arbitration award may be filed in any
court having jurisdiction. By execution and delivery of this Agreement, each Party (for itself,
its Affiliates and its designees) irrevocably and unconditionally consents and submits to the
exclusive jurisdiction of such courts and the appellate courts therefrom, and waives any right it
may have to assert the doctrine of forum non conveniens or similar doctrine or to object to venue
with respect to any proceeding. The Parties irrevocably consent to the service of process in any
such action or proceeding by the mailing of copies thereof by registered or certified mail, first
class postage prepaid to the addresses set forth in Section 9.1. In all cases, each of the
Parties
27
hereto irrevocably waives its right to a jury trial with respect to any and all actions,
claims and disputes in connection with this Agreement, any other Transaction Document or the
transactions contemplated hereby or thereby.
9.7 Publicity. The Parties agree that this Agreement and the transactions contemplated hereby
shall be treated as confidential information, and shall be held in strict confidence; provided,
however, that each Party may disclose the content and existence of this Agreement and the
transactions contemplated hereby to its employees, directors, consultants, legal counsel, providers
or prospective providers of financing and their attorneys and consultants or other agents (provided
that the Party disclosing such confidential information shall inform each such Person who has
access to such information of its confidential nature, the terms of this Agreement, and that such
terms apply to them) or as may be required by Law. In furtherance of the foregoing, there shall be
no press release or public announcement with respect to this Agreement or the transactions
contemplated hereby which discloses the identity of Seller or TPC unless required by law. If so
required, Seller and TPC will consult with each other before issuing any such press release or
public announcement.
9.8 Joint Effort. Preparation of this Agreement has been a joint effort of the Parties and
the resulting document shall not be construed more severely against one Party than against any
other Party.
9.9 Captions. The captions contained in this Agreement are for convenience and reference only
and in no way define, describe, extend or limit the scope or intent of this Agreement or the intent
of any provision contained herein.
9.10 Severability. The invalidity of one or more phrases, sentences, clauses, Sections or
Articles contained in this Agreement shall not affect the validity of the remaining portions of
this Agreement so long as the material purposes of this Agreement can be determined and
effectuated.
9.11 Counterparts. This Agreement may be executed in one or more counterparts, each of which
shall constitute an original but all of which, taken together, shall constitute but one agreement.
9.12 Third Parties. Except as otherwise expressly provided in this Agreement, nothing
contained in this Agreement shall be construed to create any right in, duty to, standard of care
with respect to, or any liability to any Person who is not a party to this Agreement.
Notwithstanding the foregoing, following the designation thereof, Purchaser is intended to be a
third party beneficiary of Articles 2, 3, 4, 5, 7, 8 and 9 of this Agreement, and shall be
entitled to enforcement of the provisions thereof.
9.13 No Waiver. Any failure of a Party to enforce any of the provisions of this Agreement or
to require compliance with any of its terms at any time during the pendency of this Agreement shall
in no way affect the validity of this Agreement, or any part hereof, and shall not be deemed a
waiver of the right of such Party thereafter to enforce any and each such provision.
28
9.14 Breach; Equitable Relief. The Parties acknowledge that the Owner Participant Interests
and the respective rights of the Parties described in this Agreement are unique and that monetary
damages alone for breach of this Agreement would be inadequate. Therefore the Parties agree that
any Party aggrieved by a breach of the provisions of this Agreement may, either in addition to or
in lieu of
an action for monetary damages, bring an action at law or suit in equity to obtain redress,
including specific performance, injunctive relief or any other available equitable remedy.
[signature page follows]
29
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and delivered
as of the date hereof.
Seller: | ||||||
Steam Heat LLC | ||||||
By: Xxxx Atlantic TriCon Leasing Corporation, its sole member |
||||||
By: | /s/ Xxxx X. Xxxx | |||||
Name: Xxxx X. Xxxx | ||||||
Title: President and Chief Executive Officer | ||||||
TPC: | ||||||
Thermal Power Company | ||||||
By: | /s/ Xxxx Xxxxx | |||||
Name: | ||||||
Title: | ||||||
Solely for purposes of Sections 6.2, 7.2.8 and 7.4 hereof, GPC: | ||||||
Geysers Power Company, LLC | ||||||
By: | /s/ Xxxx Xxxxx | |||||
Name: |
[Signature Page to Agreement]
Exhibit A
Form of Assignment and Assumption Agreement
[see attached]
Assignment And Assumption
Agreement
Dated as of [ ]
between
Steam Heat LLC,
as Transferor
and
[ ],
as Transferee
The Geysers
Geothermal Generating Facilities
Geothermal Generating Facilities
Assignment And Assumption
Agreement
This ASSIGNMENT AND ASSUMPTION AGREEMENT, dated as of (as amended,
supplemented or otherwise modified from time to time in accordance with the provisions hereof, this
“Assignment Agreement”), between Steam Heat LLC, a Delaware limited liability company (the
“Transferor”), and , a (the “Transferee”).
WITNESSETH:
WHEREAS, the Transferor entered into the Third Amended and Restated Participation Agreement,
dated as of May 7, 1999 (the “Participation Agreement”), with Geysers Power Company, LLC,
Geysers Statutory Trust, State Street Bank and Trust Company of California, National Association,
in the capacities referred to therein, First Union Trust Company, National Association, in the
capacities referred to therein, Silverado Geothermal Resources, Inc., Steam Heat Lender Trust and
Newcourt Capital USA Inc., as well as entering into certain other Operative Documents (as defined
in the Participation Agreement); and
WHEREAS, the Transferor desires to sell and assign to the Transferee all of its right, title
and interest in, to and under the Operative Documents (other than Retained Rights (as defined
below)), and the Transferee desires to (i) purchase and accept from the Transferor the assignment
of all of the Transferor’s right, title and interest in, to and under the Operative Documents
(other than Retained Rights) and (ii) assume all of the duties and obligations of the Transferor
under the Operative Documents.
NOW, THEREFORE, in consideration of the foregoing premises, the mutual agreements herein
contained, and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. | DEFINITIONS |
Capitalized terms used in this Assignment Agreement, including the recitals, and not otherwise
defined herein shall have the respective meanings specified in Appendix A to the Participation
Agreement, unless the context hereof shall otherwise require. The Rules of Interpretation set
forth in Appendix A to the Participation Agreement shall apply to terms used in this Assignment
Agreement and specifically defined herein.
2. | ASSIGNMENT BY THE TRANSFEROR |
In accordance with Section 7.1 of the Participation Agreement, the Transferor hereby sells,
assigns, conveys and transfers to the Transferee as of the date hereof (the “Transfer
Date”) all of its right, title and interest in and to the Beneficial Interest, all of the
Transferor’s right, title and interest in and to each Operative Document to which it is a party and
all other contracts, agreements, documents and instruments relating to the Beneficial Interest by
which the Transferor is bound, and any proceeds therefrom, together with all other documents and
instruments evidencing any of such right, title and interest, except such rights of the
Transferor as have accrued to the Transferor prior to the Transfer Date (such excepted rights
include, without limitation, the right to receive any amounts due or accrued to the Transferor
under the Trust Agreement or other Operative Documents as of the Transfer Date and the right to
receive any Excepted Payments pursuant to the Participation Agreement or the Tax Indemnity
Agreement as of or in respect of events occurring or arising on or prior to the Transfer Date
(collectively, the “Retained Rights”).
3. | ASSUMPTION BY THE TRANSFEREE |
The Transferee hereby assumes, and agrees it is unconditionally bound in respect of, as of the
Transfer Date, all duties and obligations of the Transferor pursuant to the Trust Agreement and
under each of the other Operative Documents to which the Transferor is a party and all other
contracts, agreements, documents and instruments relating to the Beneficial Interest to which the
Transferor is a party or by which the Transferor is bound, in each case to the extent arising or
accruing in respect of any period after the Transfer Date. The Transferee agrees that as of the
Transfer Date, it shall be deemed a party to each of the Operative Documents to which the
Transferor is a party and any other contract, agreement, document or other instrument relating to
the Beneficial Interest to which the Transferor is a party or by which it is bound and the
Transferee agrees that it is liable for all of the duties and obligations of the Transferor under
the Operative Documents to which the Transferor is a party and all other contracts, agreements,
documents and instruments relating to the Beneficial Interest to which the Transferor is a party or
by which the Transferor is bound as though it were identified as the “Owner Participant” therein.
4. | TRANSFEREE AS OWNER PARTICIPANT |
In consequence of the assumption set forth in Section 3, (a) the Transferee shall be deemed
the “Owner Participant” for all purposes, and shall enjoy the rights and privileges and perform the
obligations of the Owner Participant under each Operative Document, and each reference in each
other Operative Document to the “Owner Participant” shall be deemed to include the Transferee for
all purposes, and (b) the Transferor and the guarantor, if any, of the Transferor’s obligations
shall be released from all obligations under each Operative Document and shall have no further
duty, obligation, liability or burden under any Operative Document; provided, however, that in no
event shall the assignment and assumption effected by this Agreement waive or release the
Transferor from any liability on account of any breach of its obligations thereunder arising or
accruing in respect of any period on or prior to the Transfer Date or of any of its
representations, warranties, covenants or obligations set forth in the Operative Documents.
5. | PAYMENTS |
The Transferor hereby covenants and agrees to pay over to the Transferee, if and when received
following the Transfer Date, any amounts (including any sums payable as interest in respect
thereof) paid to or for the benefit of the Transferor that, under Section 2 hereof, belong to the
Transferee, and the Transferee hereby covenants and agrees to pay over to the Transferor, if and
when received following the Transfer Date, any amounts (including any sums payable as
interest in respect thereof) paid to or for the benefit of the Transferee that, under Section
2 hereof, belong to the Transferor.
6. | CERTAIN REPRESENTATIONS OF THE TRANSFEREE |
The Transferee represents and warrants that:
(i) The Transferee is (a) a “United States person” within the meaning of section 7701(a)(30)
of the Code and (b) Calpine or an Affiliate of Calpine.
(ii) The Transferee is either (a) an Affiliate of the Transferor which does not otherwise
qualify under clause (b) below, provided that all of the payment and performance obligations of the
Transferee under the Operative Documents are guaranteed by the Transferor (or by a Person then
providing a guaranty of the Transferor’s obligations which meets the requirements in clause (b)
below) pursuant to an OP Guaranty; or (b) a Person which meets, or the payment and performance
obligations of which under the Operative Documents are guaranteed (pursuant to an OP Guaranty) by a
Person which meets, the following criteria: (i) the tangible net worth of the Transferee or
guarantor, if any, is at least equal to $75 million calculated in accordance with GAAP; and (ii)
unless waived in writing prior to the Transfer Date by the Facility Lessee, the Transferee is not a
Competitor of, or engaged in material litigation with, Calpine or any Affiliate of Calpine.
(iii) The Transferee is a [ ] duly organized, validly existing and in good standing under
the laws of [ ] and has the corporate power and authority to enter into and perform its
obligations under this Agreement and the Operative Documents to which it will become a party upon
execution of this Agreement.
(iv) This Assignment Agreement, and the Operative Documents to which the Transferee will
become a party upon execution of this Assignment Agreement have been duly authorized, executed and
delivered and/or assumed by the Transferee and assuming the due authorization, execution and
delivery by each other party hereto and thereto, this Assignment Agreement and such Operative
Documents constitute the legal, valid and binding obligations of the Transferee, enforceable
against the Transferee in accordance with their respective terms, except as the same may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting
the rights of creditors generally and by general principles of equity.
(v) The execution and delivery or assumption, as applicable, by the Transferee of this
Assignment Agreement and the Operative Documents to which Transferee will be a party upon the
execution of this Assignment Agreement, the consummation by the Transferee of the transactions
contemplated hereby and thereby, and the compliance by the Transferee with the terms and provisions
hereof and thereof, do not and will not contravene any Applicable Law binding on the Transferee, or
its organizational documents, or contravene the provisions of, or constitute a default under any
indenture, mortgage or other material contract, agreement or instrument to which the Transferee is
a party or by which the Transferee or its property is bound, or result in the creation of any Owner
Participant’s Lien (other than any Lien created under any Operative Document) upon the Trust
Estate, any Site or any Steam Field Asset or any interest
therein or part thereof (it being understood that no representation or warranty is being made as to
(i) any Applicable Laws relating to the particular nature of the Facilities or the Facility Sites
or (ii) other than its representations set forth in Section 6(ix), ERISA or Section 4975 of the
Code).
(vi) Assuming the representations and warranties of Facility Lessee contained in paragraphs
(j), (k), (l), (m), (r) and (mm) of Section 3.1 of the Participation Agreement are true, no
authorization or approval or other action by, and no notice to or filing or registration with, any
Governmental Entity is required for the due execution, delivery, assumption or performance by the
Transferee of this Assignment Agreement or the Operative Documents to which the Transferee will be
a party upon the execution of this Assignment Agreement, other than any authorization or approval
or other action or notice or filing as has been duly obtained, taken or given (it being understood
that no representation or warranty is being made as to any Applicable Laws relating to the
Facilities or the Facilities Sites).
(vii) There is no pending or, to the Actual Knowledge of the Transferee, threatened, action,
suit, investigation or proceeding against the Transferee before any Governmental Entity which (i)
questions the validity of this Agreement or the Transaction Documents to which the Transferee will
be a party upon the execution of this Assignment Agreement or the ability of the Transferee to
perform its obligations under any such agreement or (ii) if determined adversely to it, could
reasonably be expected to materially adversely affect the ability of the Transferee to perform its
obligations under any such agreement or would materially adversely affect any of the Facilities,
the Sites or any interest therein or part thereof or the Lien of the Lease Indenture Trustee on the
Indenture Estate.
(viii) Each of the Trust Estate, the Sites, the Steam Field Assets, any interest therein or
part thereof is free of any Owner Participant’s Liens attributable to the Transferee.
(ix) No part of the funds to be used by the Transferee to purchase the Beneficial Interest,
directly or indirectly, constitutes or is deemed to constitute assets (within the meaning of ERISA
and any applicable rules, regulations and court decisions thereunder) of any “employee benefit
plan” (as defined in Section 3(3) of ERISA) that is subject to ERISA of any Transaction Party and
ERISA Affiliate thereof.
(x) The Transferee is purchasing the Beneficial Interest for its own account with no present
intention of distributing such Beneficial Interest or any part thereof in any manner which would
require registration under or would violate the Securities Act, but without prejudice, however, to
the right of the Transferee at all times to sell or otherwise dispose of all or any part of such
Beneficial Interest under an exemption from registration available under such Act.
(xi) Neither the Transferee nor anyone authorized by it has directly or indirectly offered or
sold any interest in the Beneficial Interest or the Lessor Notes or any part thereof, or in any
similar security or lease, or in any security or lease the offering of which for the purposes of
the Securities Act would be deemed to be part of the same offering as the offering of the
Beneficial Interest or the Lessor Notes or any part thereof or solicited any offer to acquire any
of the same in violation of the registration requirements of Section 5 of the Securities Act
(xii) Immediately prior to executing this Assignment Agreement, the Transferee is not an
“electric utility”, “electric utility company”, “public utility”, “public-utility company”,
“holding company” or a “subsidiary” or “affiliate” of any of the foregoing, under the Federal Power
Act or the Holding Company Act.
(xiii) The Transferee is not an “investment company” or a company controlled by an “investment
company” within the meaning of the Investment Company Act of 1940.
(xiv) The Transferee is an experienced and knowledgeable investor in the power generation and
development business. Prior to entering into this Assignment Agreement, Transferee was advised by
its counsel, accountants, financial advisors, and such other Persons it has deemed appropriate
concerning this Assignment Agreement and has relied solely (except for the representations and
warranties of Transferor set forth in Article 5 of that certain Agreement dated as of
December 20, 2005 by and between Transferor, Thermal Power Company and Geysers Power Company, LLC
(the “Agreement”)) on an independent investigation and evaluation of, and appraisal and
judgment with respect to, the Beneficial Interest and the revenue, price and expense assumptions
applicable thereto.
(xv) Transferee satisfies all of the requirements of a “Transferee” under Section 7.1 of the
Participation Agreement.
(xvi) On the Transfer Date, Transferee acknowledges and agrees that the interests being
purchased hereunder have not been and will not be registered under the Securities Act of 1933, as
amended, or any other applicable securities law, and to the extent such interests constitute
“securities” under any such law, may be resold only if registered pursuant to the provisions of
such law, or if an exemption from such registration is available.
(xvii) Transferee has adequate information concerning the business and financial condition of
the Facility Lessee, and understands the disadvantage to which it may be subject on account of any
disparity of information as between the parties hereto. Transferee is capable of evaluating the
merits and risks of the transactions contemplated herein.
(xviii) Transferee acknowledges that it has not received any investment advice or opinion from
Transferor on whether the transaction contemplated herein is prudent. Transferee acknowledges that
(i) Transferor currently may have, and later may come into possession of, information regarding the
Facility Lessee that is not known to Transferee and that may be material to a decision to enter
into the transactions contemplated herein (“Purchaser Excluded Information”), (ii) except
to the extent such information may be covered by Transferor’s covenants, representations or
warranties set forth in the Agreement, it has determined to enter into the transactions
contemplated herein notwithstanding its lack of knowledge of Purchaser Excluded Information, and
(iii) except to the extent the failure to disclose such information results in a breach of any of
Transferor’s covenants, representations or warranties in the Agreement, Transferor shall not have
any liability to Transferee with respect to the nondisclosure of Purchaser Excluded Information.
(xix) The consideration given for the purchase by Transferee of the Beneficial Interest may
differ both in kind and in amount from any payments or distributions which Transferee may
ultimately receive with respect thereto. Transferee shall have no recourse to Transferor for any
deficiency. Transferor shall not have any liability for the failure of the Facility Lessee or any
other Person to pay any amount, or perform any other covenant, under the Operative Documents.
7. | CERTAIN REPRESENTATIONS OF THE TRANSFEROR |
The Transferor represents and warrants to Transferee that the representations and warranties
made by it in the Agreement are true and correct as of the date hereof.
Except for the representations and warranties of Transferor expressly set forth in Article
5 of the Agreement, Transferee expressly disclaims any representations or warranties of any
kind, express or implied, relating to Transferor, the Owner Lessor, the Beneficial Interest or the
transactions contemplated by the Agreement.
IN FURTHERANCE OF THE FOREGOING, TRANSFEREE ACKNOWLEDGES THAT ANY TRANSFER OF THE BENEFICIAL
INTEREST WILL BE EFFECTED WITH RESPECT TO THE FACILITIES IN THEIR “AS IS, WHERE IS” CONDITION, AND
TRANSFEROR MAKES NO WARRANTIES, GUARANTEES OR REPRESENTATIONS, EXPRESS OR IMPLIED, ARISING BY LAW
OR OTHERWISE, WITH RESPECT TO THE FACILITIES. TRANSFEREE WAIVES, RELEASES AND RENOUNCES (1) ANY
IMPLIED WARRANTY AS TO THE DESCRIPTION, MERCHANTABILITY, FITNESS FOR ANY PURPOSE, VALUE, CONDITION,
DESIGN, DATE PROCESSING, USE OR OPERATION OF THE FACILITIES OR ANY PAST PERFORMANCE, COURSE OF
DEALING, USAGE OR TRADE OR OTHERWISE, (2) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT
(INCLUDING STRICT LIABILITY) WITH RESPECT TO THE CONDITION OF THE FACILITIES, AND (3) ANY
OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY OF OR AGAINST TRANSFEROR OR GUARANTOR FOR LOSS OF OR
DAMAGE TO THE FACILITIES, FOR ANY LIABILITY OF THE FACILITY LESSEE TO ANY THIRD PARTY, FOR ANY
LIABILITY OF TRANSFEREE TO ANY THIRD PARTY, OR FOR ANY OTHER DIRECT, INCIDENTAL OR CONSEQUENTIAL
DAMAGES AS A RESULT OF ANY OF THE FOREGOING, AND ALL SUCH WARRANTIES, GUARANTEES, REPRESENTATIONS,
OBLIGATIONS, LIABILITIES, RIGHTS, CLAIMS OR REMEDIES, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE,
TO THE EXTENT NOT SET FORTH IN THIS AGREEMENT, ARE EXPRESSLY EXCLUDED; PROVIDED, HOWEVER,
THAT THE FOREGOING DOES NOT LIMIT SELLER’S REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
ARTICLE 5 OF THE AGREEMENT OR SELLER’S OBLIGATIONS AND LIABILITIES EXPRESSLY SET FORTH IN
THE AGREEMENT.
8. | BENEFICIARIES |
The Facility Lessee, the Owner Lessor, the Owner Trustee, the Trust Company and, so long as
the Lien of the Collateral Documents has not been terminated or discharged, the Lenders, the Lease
Indenture Trustee and the Lease Indenture Company, together with their respective successors and
permitted assigns, are each third party beneficiaries of this Assignment Agreement (each, a
“Beneficiary” or, together, the “Beneficiaries”).
9. | MISCELLANEOUS |
(i) Amendments and Waivers. No term, covenant, agreement or condition of this Assignment
Agreement 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 each party hereto and consented to by the Facility Lessee and, so long as the
Lien of the Collateral Documents has not been terminated, the Lease Indenture Trustee, such consent
not to be unreasonably withheld or delayed.
(ii) Notices. The Transferee hereby designates that copies of all communications and notices
to the Transferor pursuant to the Operative Documents shall be sent to the Transferee at its
address set forth below. Unless otherwise expressly specified or permitted by the terms hereof,
all communications and notices provided for herein shall be in writing or by a telecommunications
device capable of creating a written record, and any such notice shall become effective (a) upon
personal delivery thereof, including, without limitation, by overnight mail or courier service, (b)
in the case of notice by United States mail, certified or registered, postage prepaid, return
receipt requested, upon receipt thereof, or (c) in the case of notice by such a telecommunications
device, upon transmission thereof, provided such transmission is promptly confirmed by either of
the methods set forth in clauses (a) or (b) above, in each case addressed to each party hereto at
its address set forth below or, in the case of either party hereto, at such other address as such
party may from time to time designate by written notice to the other party hereto:
If to the Transferor: | ||||||
Facsimile No.: | ||||||
Telephone No.: | ||||||
Attention: | ||||||
If to the Transferee: | ||||||
Facsimile No.: | ||||||
Telephone No.: | ||||||
Attention: | ||||||
(iii) Survival. All warranties, representations, indemnities and covenants made by any party
hereto, herein or in any certificate or other instrument delivered by either party or on the behalf
of either party under this Assignment Agreement, shall be considered to have been relied upon by
the other party hereto and shall survive the consummation of the transactions contemplated hereby
on the date of execution and delivery of this Assignment Agreement regardless of any investigation
made by either party or on behalf of such party.
(iv) Successors and Assigns. The Transferee covenants and agrees that it shall obtain any and
all consents required under the Operative Documents if the Transferee assigns its interest under
this Assignment Agreement. If the Transferee assigns such interest under this Assignment
Agreement, then this Assignment Agreement shall be binding upon and shall inure to the benefit of,
and shall be enforceable by, the respective successors and assigns as permitted by and in
accordance with the terms hereof.
(v) Governing Law. This Assignment Agreement 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
thereof, other than New York General Obligations Law Section 5-1401).
(vi) Severability. Any provision of this Assignment Agreement 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.
(vii) Counterparts. This Assignment Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an original, but all
such counterparts shall together constitute but one and the same instrument.
(viii) Headings. The headings of the sections of this Assignment Agreement are inserted for
purposes of convenience only and shall not be construed to affect the meaning or construction of
any of the provisions hereof.
(ix) Entire Agreement. This Assignment Agreement, together with the other applicable
Transaction Documents constitutes the entire agreement of the parties hereto and thereto with
respect to the subject matter hereof and thereof and supersedes all oral and all prior written
agreements and understandings with respect to such subject matter.
(x) Further Assurances. Each party hereto 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 party to whom such first party is obligated, all as may be reasonably necessary to
carry out more effectively the intent and purpose of this Assignment Agreement.
[signature page follows]
IN WITNESS WHEREOF, the parties hereto have caused this Assignment Agreement to be duly
executed and delivered by their respective officers thereunto duly authorized.
Steam Heat LLC, as Transferor |
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By: Xxxx Atlantic TriCon Leasing Corporation, its sole member |
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By: | ||
Name: | ||
Title: | ||
Date: | ||
[ ], as Transferee |
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By: | ||
Name: | ||
Title: | ||
Date: |
Exhibit B
Form of Seller Guaranty
[see attached]
Exhibit C
Form of Non-Foreign Certificate
[see attached]
Exhibit D
Letter Agreement
[see attached]