REINSTATEMENT AGREEMENT
This Reinstatement Agreement (the "Agreement") is dated as of July 6, 1999
by and among Southern Energy Canal, L.L.C. ("Southern Canal') and Montaup
Electric Company ("Montaup"). The parties hereto are referred to herein
individually as a "Party" and collectively as the "Parties."
RECITALS
A. In connection with Southern Canal's acquisition of the Canal Station,
Southern Canal assumed certain Power Contracts with Montaup, New England Power
Company ("NEPCO"), Commonwealth Electric Company and Cambridge Electric Light
Company (collectively "COM/Elec") and Boston Edison Company ("BECO')
(collectively the "Original Purchasers") dated December 1, 1965 (the "Original
Contracts") for the sale of 25% of the capacity and energy from Canal Unit I to
each of the Original Purchasers.
B. Pursuant to that certain PPA Transfer Agreement dated October 29, 1997
between USGen New England, Inc. ("USGenNE") and NEPCO, USGenNE was entitled to
certain rights and benefits and was required to perform certain obligations
under NEPCO's Original Contract.
C. Southern Canal entered into Amended and Restated Power Sales Contracts
dated December 18, 1998 with COM/Elec, BECO, and Montaup (the "Amended
Agreements") and submitted the Amended Agreements to the Federal Energy
Regulatory Commission ("FERC') for filing under Southern Canal's market rate
authority.
D. NEPCO and USGenNE filed a protest with FERC regarding the Amended
Agreements on the grounds that the consent of NEPCO was required for the
amendment of the Original Contracts.
E. FERC rejected Southern Canal's filing of the Amended Agreements, and
Southern Canal withdrew its filing and then refiled the Original Contracts
under cost of service rate authority.
F. Southern Canal has obtained the consent of NEPCO and USGenNE to the
Amended Agreements and has entered into a new Amended and Restated Power Sales
Contract with NEPCO which then assigned the contract to USGenNE and which in
turn will assign the contract to Southern Energy New England, L.L.C. effective
August 1, 1999.
G. The Parties desire to reinstate the Amended Agreement between them (the
"Montaup Agreement") in accordance with the terms hereof.
H. Montaup has entered into a Power Purchase and Sale Agreement dated as of
December 21, 1998 with Constellation Power Source, Inc. ("Constellation")
pursuant to which Montaup has agreed to sell the products it receives under the
Montaup Agreement to Constellation.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, the Parties hereto mutually covenant and
agree as follows:
1. Southern Canal and Montaup hereby reinstate the Montaup Agreement,
effective as of July 1, 1999 (the "Effective Date").
2. Southern Canal consents to any future assignment by Montaup of the
Montaup Agreement to Constellation; provided, however, that at the time of such
assignment Constellation meets the Creditworthiness Criteria asset forth in the
Montaup Agreement or delivers to Southern Canal a duly executed Guarantee in
form and substance satisfactory to Southern Canal from Constellation's parent
company which meets the Creditworthiness Criteria.
3. Southern Canal shall file this Agreement with FERC and the Parties
agree that the rates set forth in the Montaup Agreement apply for the period
from January 1, 1999 through the Effective Date. Within 30 days after a final
order from FERC approving this Agreement, Southern Canal shall pay Montaup the
amount, if any, by which the sum of the demand charges for January 1, 1999
through the Effective Date billed to and paid by Montaup under the Original
Agreement is greater than the amount that would have been payable if the
Montaup Agreement were effective as of January 1, 1999; provided that such
payment shall be made with interest computed in accordance with the FERC
regulations.
4. In connection with this Agreement and the transactions contemplated
hereby, each Party shall execute and deliver any additional documents and
instruments and perform any additional acts that may be necessary or
appropriate to effectuate and perform the provisions of this Agreement.
5. This Agreement shall inure to the benefit of and be binding upon the
Parties and their respective successors and assigns.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their officers duly authorized thereunto and have duly caused their
corporate or company seals to be affixed hereto.
SOUTHERN ENERGY CANAL, L.L.C.
By: /s/Xxxxx X. X. Coolidale, Jr.
Name: Xxxxx X. X. Coolidale, Jr
Title: President
MONTAUP ELECTRIC COMPANY
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
