Exhibit 10.50
CONSENT TO ASSIGNMENT
THIS CONSENT TO ASSIGNMENT (this "Consent"), dated as of
August 1, 1995, is executed by SOUTHERN COMPANY SERVICES, INC., an Alabama
corporation (the "Consenting Party"), MOBILE ENERGY SERVICES COMPANY, L.L.C., an
Alabama limited liability company (the "Company"), and BANKERS TRUST (DELAWARE),
a Delaware banking corporation, as Collateral Agent for the Senior Secured
Parties (as hereinafter defined) (the "Collateral Agent").
W I T N E S S E T H:
WHEREAS, the Company, Mobile Energy Services Holdings, Inc.
(formerly known as Mobile Energy Services Company, Inc.), an Alabama
corporation ("Mobile Energy"), and First Union National Bank of
Georgia, as trustee (in such capacity, the "Indenture Trustee"), have
entered into a Trust Indenture dated as of August 1, 1995 (as the same
may be amended, supplemented, waived or otherwise modified, the
"Indenture"), pursuant to which the Company (i)is issuing its First
Mortgage Bonds, the proceeds of which will be used to (among other
things) repay to The Southern Company a portion of the amounts advanced
to pay certain costs associated with the acquisition of the energy and
black liquor recovery complex located at an integrated pulp, paper and
tissue manufacturing facility in Mobile, Alabama (together with the
related real property rights and other related assets of the Company,
the "Energy Complex") and (ii) may, from time to time, issue additional
Senior Debt (as defined in the Indenture);
WHEREAS, the Company, Mobile Energy and The Industrial
Development Board of the City of Mobile, Alabama (the "IDB") have
entered into an Amended and Restated Lease and Agreement dated as of
August 1, 1995 with respect to a portion of the Energy Complex relating
to the IDB's Solid Waste Revenue Refunding Bonds (Mobile Energy
Services Company, L.L.C. Project), Series 1995, to be issued for the
benefit of the Company pursuant to an Amended and Restated Trust
Indenture dated as of August 1, 1995 (as the same may be amended,
supplemented, waived or otherwise modified, the "Tax-Exempt Indenture")
between the IDB and First Union National Bank of Georgia, as trustee
(in such capacity, the "Tax-Exempt Trustee"). The proceeds of the
Tax-Exempt Bonds will be used to refinance certain outstanding
tax-exempt bonds and to pay for certain other costs. The Company may
cause the IDB to issue, from time to time, additional Senior Debt under
the Tax-Exempt Indenture;
WHEREAS, the Company and Banque Paribas (together with any
lender that is or becomes a provider of the Working Capital Facility
(as hereinafter defined), the "Working Capital Facility Provider" and,
together with the Indenture Trustee and the Tax-Exempt Trustee, the
"Senior Secured Parties") have entered into a Revolving Credit Facility
dated as of August 1, 1995 (as the same may be amended, supplemented,
waived or otherwise modified and, together with any replacement working
capital facility, the "Working Capital Facility"), borrowings under
which will be used from time to time to finance certain working capital
requirements of the Company;
WHEREAS, the Consenting Party and the Company have entered
into a Services Agreement dated as of July 14, 1995 (as the same may be
amended, supplemented, waived or otherwise modified, the "Contract");
WHEREAS, the Collateral Agent has been granted a security
interest in the Contract and the Energy Complex for the benefit of the
Senior Secured Parties pursuant to an Assignment and Security Agreement
dated as of August 1, 1995 between the Collateral Agent and the Company
and a Leasehold Mortgage, Assignment of Leases, Rents, Issues and
Profits dated as of August 1, 1995 between the Collateral Agent and the
Company; and
WHEREAS, the Collateral Agent, the Senior Secured Parties, the
IDB, the Company and Mobile Energy have entered into an Intercreditor
and Collateral Agency Agreement dated as of August 1, 1995 (as the same
may be amended, supplemented, waived or otherwise modified, the
"Intercreditor Agreement").
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, the parties hereto
hereby agree as follows.
1. Consent to Assignment. The Consenting Party hereby
irrevocably consents to the Company's assignment of the Contract to the
Collateral Agent as security; and the Consenting Party shall, at the Collateral
Agent's request in the exercise of its rights as Collateral Agent, continue
performance under the Contract in accordance with its terms and the terms of
this Consent to Assignment; provided, however, that any such assignment shall be
subject to the receipt by the Consenting Party of any necessary regulatory
approvals, for which the Consenting Party shall diligently apply and use best
efforts to obtain; and provided, further, that the Contract shall be subject to
termination by the Consenting Party upon six (6) months notice at any time
following any such assignment.
2. No Defaults. The Consenting Party represents and
warrants to, and agrees with, the Collateral Agent that (a) the
Consenting Party shall perform and comply with all material terms
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and provisions of the Contract applicable to it, (b) the Contract is in full
force and effect and there are no amendments, modifications or supplements
thereto, either oral or written, (c) the Consenting Party has not assigned,
transferred or hypothecated any of its right, title and interest in and to the
Contract or any interest therein, (d) the Consenting Party has no knowledge of
any default by the Company in any respect in the performance of any provision of
the Contract or of any existing claims or rights of set-off by the Consenting
Party or any of its affiliates against the Company, (e) the Company has
fulfilled all of its material obligations under the Contract required to be
performed on or prior to the date hereof and there are no material breaches or
unsatisfied conditions presently existing (or that, with the giving of notice or
the passage of time or both, would exist) or that would result from the
consummation of any transaction contemplated by the Contract or this Consent to
Assignment to take place on the date hereof that would allow the Consenting
Party to terminate this Consent to Assignment or the Contract, (f) to the best
knowledge of the Consenting Party, none of the Company's rights under the
Contract has been waived, (g) the security assignment of the Contract by the
Company to the Collateral Agent, and the acknowledgment of and consent to such
assignment by the Consenting Party, will not, cause or constitute a default
under the Contract or an event or condition that, with the giving of notice or
the passage of time or both, would constitute a default under the Contract and
(h) a foreclosure or other exercise of remedies under the Financing Documents
(as defined in the Indenture) or any sale thereunder by the Collateral Agent or
any of its designees or assignees, whether by judicial proceedings or under any
power of sale contained therein, or any conveyance from the Company or the
Collateral Agent or any such designee or assignee, in lieu thereof, shall not
cause or constitute a default under the Contract or an event or condition that,
with the giving of notice or the passage of time or both, would constitute a
default under the Contract.
3. Notice of Termination, Transfer, Etc.. (a) The Consenting
Party will not, without the prior written consent of the Collateral Agent, (i)
cancel, suspend or terminate the Contract, except as provided in the Contract
and in accordance with Section 3(b) hereof, or consent to or accept any
cancellation, suspension or termination thereof by the Company (other than upon
the stated expiration of the term of the Contract), (ii) sell, assign or
otherwise dispose of (by operation of law or otherwise) any part of its interest
in the Contract, (iii) amend or modify the Contract in any respect that may
reasonably be expected to have a material adverse effect on the Company's rights
or obligations or (iv) claim prevention of or interference with performance of
its obligations under the Contract, except as otherwise provided in Section 3(b)
hereof. The Consenting Party agrees to deliver duplicates or copies of all (i)
notices of default delivered by the Consenting Party under or pursuant to the
Contract to the Collateral Agent promptly upon delivery thereof to the Company
(and the Consenting Party agrees that no such notice of default shall be
effective until received by the Collateral Agent) and (ii) amendments to the
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Contract (and the Consenting Party agrees that no such amendment shall be
effective until received by the Collateral Agent).
(b) The Consenting Party will not exercise any right it may
have under the Contract, at law or in equity, to cancel, suspend or terminate
the Contract (other than upon the stated expiration of the term of the Contract
or at the option of the Consenting Party on six (6) months notice as
contemplated by Section 1 hereof) or any of its obligations thereunder on
account of any default, breach or other act or omission of the Company
thereunder without (i) in the case of a default by the Company that is the
failure by the Company to pay amounts to the Consenting Party that are due and
payable under the Contract, first providing to the Collateral Agent written
notice of such default, breach or other act or omission and the greater of (A)
the cure period specified in such Contract and (B) ninety (90) days from the
date such notice is received by the Collateral Agent to pay such amounts
(provided that the Consenting Party may suspend performance under the Contract
within thirty (30) days), notwithstanding the foregoing, and (ii) in the case of
a default, breach or other act or omission that cannot be cured by the payment
of money to the Consenting Party, first providing to the Collateral Agent
written notice of such default, breach or other act or omission and the greater
of (A) the cure period specified in such Contract and (B) one hundred eighty
(180) days from the date such notice is received by the Collateral Agent to cure
such breach or default so long as the Collateral Agent or its designee shall
have commenced to cure such breach, default or other act or omission within
ninety (90) days and thereafter diligently pursues such cure to completion or,
with respect to any default, breach or other act or omission that is not
susceptible of being cured by the Collateral Agent, to rectify, to the
Consenting Party's reasonable satisfaction, the effect on the Consenting Party
thereof within one hundred eighty (180) days from the date such notice is
received by the Collateral Agent. If possession of the Energy Complex (by way of
foreclosure proceedings or otherwise) is necessary to cure such breach, default
or other act or omission, the Collateral Agent or its successor, transferee or
assignee will be allowed a reasonable additional period to complete such
proceedings or otherwise accomplish such possession, provided that in no event
shall such additional period exceed ninety (90) days and provided that the
Collateral Agent or its successor, transferee or assignee proceeds diligently
throughout such additional period to accomplish such possession.
If the Collateral Agent or its successor, transferee or
assignee is prohibited by any court order or bankruptcy or insolvency
proceedings from curing the default, breach or other act or omission or from
commencing or prosecuting foreclosure proceedings, the foregoing time periods
shall be extended by the period of such prohibition. The Consenting Party
consents to the transfer of the Company's interest under the Contract to the
Collateral Agent for the benefit of the Senior Secured Parties or a purchaser or
grantee at a foreclosure sale by judicial or nonjudicial foreclosure and sale or
by a conveyance by the Company
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in lieu of foreclosure and agrees that, upon such foreclosure, sale or
conveyance, the Consenting Party shall recognize the Collateral Agent or such
other purchaser or grantee as the applicable party under the Contract so
transferred, provided that the Collateral Agent or such purchaser or grantee
assumes the obligations of the Company under such Contract.
The notice specified in this Section 3(b) shall be in writing
and shall be addressed to the Collateral Agent as set forth below or to such
other address as the Collateral Agent may have specified by written notice
delivered in accordance herewith. Such notice shall be effective (a) if by
telecopier, when transmitted to the telecopier number specified herein and
received at such number, (b) if by registered or certified mail, postage
prepaid, return receipt requested, on the third business day after delivered to
a United States post office and a receipt therefor is issued thereby or (c) if
by any other means, when delivered to the specified address:
Bankers Trust (Delaware)
c/o Bankers Trust Company
Four Albany Street, 4th Floor
New York, New York 10006
Attention: Corporate Trust and Agency Group
Telecopier No.: 000-000-0000
Failure of the Consenting Party to provide such notice to the Collateral Agent
shall not constitute a breach of this Consent to Assignment, and the Collateral
Agent agrees that the Consenting Party shall have no liability to the Collateral
Agent for such failure whatsoever; provided, however, that no cancellation,
suspension or termination (other than upon the stated expiration of the term of
the Contract) of the Contract by the Consenting Party, or of any of the
Consenting Party's obligations thereunder by the Consenting Party, shall be
binding upon the Collateral Agent without such notice and the expiration of the
applicable cure period set forth in this Section 3(b).
4. No Previous Assignment. Except for the assignment
contemplated by this Consent to Assignment, the Consenting Party represents and
warrants to the Collateral Agent that it has no actual notice of any assignment
of the Contract and that it has not previously consented to any assignment,
transfer or hypothecation of the Contract or any interest therein by the
Company, other than subcontracts entered into in the ordinary course of
business.
5. Payments to Revenue Account. The Consenting Party hereby
agrees that, until the Collateral Agent has given the Consenting Party written
notice that the obligations secured by the Contract have been paid, observed and
satisfied in full, all payments to be made by the Consenting Party pursuant to
the terms of the Contract shall be made directly to the Collateral Agent, c/o
Bankers Trust Company, for deposit into the Revenue Account
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established and created under the Intercreditor Agreement (Account No. 15351),
at Bankers Trust Company, Four Albany Street, New York, New York 10006, or to
such other person or at such other address as the Collateral Agent may from time
to time specify in writing to the Consenting Party. By executing this Consent to
Assignment, the Company hereby directs the Consenting Party to make all payments
due to the Company under the Contract directly to the Collateral Agent, c/o
Bankers Trust Company, or such other person as provided for above until the
Consenting Party has received the notice referred to in the first sentence of
this Section 5.
6. Protection of Collateral Agent. In the event that (a)
either (i) the Company's interest in the Energy Complex shall be sold, assigned
or otherwise transferred pursuant to the exercise of any right, power or remedy
by the Collateral Agent or pursuant to judicial proceedings or (ii) the Company
rejects the Contract under the Federal Bankruptcy Code, or other similar Federal
or state statute, and such rejection is approved by the appropriate bankruptcy
court or is otherwise effective pursuant to such statute and (b) in either case
(i) all funds payable under the Contract shall be paid, (ii) the Collateral
Agent shall have cured any material default or breach by the Company under the
Contract that is susceptible of being corrected by the Collateral Agent or by a
purchaser at any judicial or non-judicial sale, (iii) the Contract shall have
been terminated pursuant to the terms thereof by reason of a default or a
rejection in bankruptcy under the Federal Bankruptcy Code, or other similar
Federal or state statute, and (iv) the effect upon the Consenting Party of any
default not susceptible of being corrected shall have been rectified, to the
Consenting Party's reasonable satisfaction, then the Consenting Party shall,
within fifteen (15) days after receipt of written request therefor, execute and
deliver to the Collateral Agent or its nominee, purchaser, assignee or
transferee (as the case may be) an agreement containing the same terms as the
Contract so terminated for the remainder of the term thereof. References in this
Consent to Assignment to "Contract" shall be deemed also to refer to such new
agreements.
7. Acknowledgment of the Collateral Agent's Obligations and
Rights. None of the Collateral Agent, the Senior Secured Parties or the IDB has
any obligation hereunder to extend credit to the Consenting Party or any
contractor of the Consenting Party at any time for any purpose. None of the
Collateral Agent, the Senior Secured Parties or the IDB shall have any
obligation to the Consenting Party under the Contract unless and until such time
as it succeeds to the interests of the Company under such Contract. It is
expressly understood and agreed by the parties hereto that this Consent has been
executed by Bankers Trust (Delaware), not in its individual capacity, but solely
as Collateral Agent hereunder in the exercise of the power and authority
conferred and vested in it, and nothing contained herein shall be construed as
creating any liability on Bankers Trust (Delaware), individually or personally,
to perform any covenant, either expressed or implied, contained
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herein, all such liability, if any, being expressly waived by the
parties hereto.
8. Exercise of Remedies by the Collateral Agent. Upon
delivery of written notice by the Collateral Agent to the
Consenting Party that the Collateral Agent or any of its designees
or assignees (as the case may be) expressly elects to assume the
obligations of the Company under the Contract, the Collateral Agent
or any of its designees or assignees shall have the full right and
power to enforce directly against the Consenting Party all
obligations of the Consenting Party under such Contract and
otherwise to exercise all remedies thereunder and to make all
demands and give all notices and make all requests required or
permitted to be made by the Company under such Contract.
9. The Company Not to Cause Breach. The Company hereby irrevocably
waives any rights that it may have, including those arising under the Contract,
to seek to compel the Consenting Party to act in a manner inconsistent with this
Consent to Assignment while this Consent to Assignment is in effect.
10. Representations. The Consenting Party represents
and warrants to the Company and the Collateral Agent as follows:
(a) The Consenting Party is duly organized, validly existing
and in good standing under the laws of the State of Alabama.
(b) The Consenting Party has the necessary corporate power and
corporate authority to execute, deliver and perform the Contract and
this Consent to Assignment; the execution and delivery by the
Consenting Party of the Contract and this Consent to Assignment and the
performance of its obligations thereunder and hereunder have been duly
authorized by all necessary corporate action and do not and will not
(i) require any consent or approval of the Consenting Party's board of
directors and shareholders, except for those consents and approvals
that have been duly obtained and are in full force and effect, (ii)
violate any provision of the articles of incorporation and by-laws of
the Consenting Party or any provision of any law, rule or regulation,
or any order, writ, judgment, injunction, decree, determination or
award having applicability to the Consenting Party, (iii) result in a
breach of or constitute a default under any indenture, loan agreement,
credit agreement or any other agreement, lease or instrument to which
the Consenting Party is a party or by which it or its properties may be
bound or affected or (iv) result in, or require, the creation or
imposition of any mortgage, deed of trust, pledge, lien, security
interest, charge or encumbrance of any nature now owned or hereafter
acquired by the Consenting Party; and the Consenting Party is not in
violation, breach or default of any provision of the articles of
incorporation and bylaws of the Consenting Party or any provision of
any law, rule, regulation, order, writ,
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judgment, injunction, decree, determination or award having
applicability to the Consenting Party or any agreement referred to
above in clause (iii) of this Section 10(b), which violation could have
a material adverse effect on the ability of the Consenting Party to
perform its obligations under this Consent to Assignment or the
Contract.
(c) Each of the Contract and this Consent to Assignment has
been duly executed and delivered and constitutes a valid and binding
obligation of the Consenting Party, enforceable against the Consenting
Party in accordance with its terms, except to the extent that
enforceability may be limited by applicable bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting the
enforcement of creditors' rights and general equitable principles
(regardless of whether such enforceability is considered in a
proceeding in equity or in law).
(d) Except as set forth in Section 1 hereof no consent or
approval of, or other action by, or any notice or filing with, any
court or administrative or governmental body (except those previously
obtained and in full force and effect) is required in connection with
the execution and delivery of the Contract or this Consent to
Assignment or the performance by the Consenting Party of its
obligations thereunder or hereunder, and the Consenting Party has
obtained all permits, licenses, approvals, consents, authorizations and
exemptions with respect to the performance of its obligations under the
Contract and this Consent to Assignment required by applicable laws,
statutes, rules and regulations in effect as of the date hereof.
(e) The Consenting Party is not in default with respect to the
Contract and has no knowledge, as of the date hereof, of any claims or,
except as otherwise set forth in the Contract, rights of set-off by the
Consenting Party or by any of its affiliates against the Company. The
Consenting Party will not exercise any right of set-off it may have
against the Company under the Contract other than with respect to
matters arising under such Contract.
(f) There are no proceedings pending or, to the best of the
Consenting Party's knowledge after due inquiry, threatened against or
affecting the Consenting Party in any court or before any governmental
authority or arbitration board or tribunal (whether or not purportedly
on behalf of the Consenting Party) that may result in a material
adverse effect on the property, business, prospects or financial
condition of the Consenting Party or on the ability of the Consenting
Party to perform its obligations under, or that purports to affect the
legality, validity or enforceability of, the Contract or this Consent
to Assignment; and the Consenting Party is not in default with respect
to any order of any court, governmental authority or arbitration board
or tribunal that may result in
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a material adverse effect on the Consenting Party's ability to perform
its obligations under this Consent to Assignment or the Contract.
11. Binding Upon Successors. All agreements, covenants,
conditions, representations and warranties in this Consent to
Assignment shall be binding upon and inure to the benefit of and be
enforceable by the successors and assigns of each of the parties
hereto.
12. Captions. The captions or headings at the beginning
of each Section hereof are for convenience only and shall not
affect the construction hereof.
13. Governing Law. THE CONSENTING PARTY AND THE COMPANY
ACKNOWLEDGE AND AGREE THAT THE CONTRACT SHALL BE GOVERNED BY THE LAW OF THE
STATE OF GEORGIA. THE RIGHTS AND DUTIES OF THE PARTIES UNDER THIS CONSENT TO
ASSIGNMENT SHALL, PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW, BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE
CHOICE OF LAW PROVISIONS THEREOF (OTHER THAN SUCH SECTION 5-1401).
14. Amendment. This Consent to Assignment may be
modified, amended or rescinded only by a writing expressly
referring to this Consent to Assignment and signed by all of the
parties hereto.
15. Severability. Any provision of this Consent to Assignment
that may be determined by competent authority to be invalid or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without invalidating or rendering
unenforceable any remaining terms and provisions hereof, and such invalidity or
unenforceability shall not invalidate or render unenforceable such provision in
any other jurisdiction.
16. Termination. This Consent to Assignment shall be
deemed to be terminated and of no further force and effect at the
earlier of (a) payment in full of all Secured Obligations (as
defined in the Intercreditor Agreement) and (b) termination of the
Contract in accordance with the provisions of Section 3(b) hereof.
17. Counterparts. This Consent to Assignment may be
executed in any number of counterparts, each of which when so
executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
instrument.
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IN WITNESS WHEREOF, each of the Consenting Party, the Collateral Agent
and the Company have duly executed this Consent to Assignment as of the date
first above written.
SOUTHERN COMPANY SERVICES, INC.,
an Alabama corporation,
as the Consenting Party
By: /s/
Name: X.X. Xxxxxxxxx
Title:Executive Vice President and
Treasurer
BANKERS TRUST (DELAWARE),
a Delaware banking corporation, as
the Collateral Agent
By: /s/
Name: Xxxxx X. Xxxxxxxxx
Title:President
MOBILE ENERGY SERVICES COMPANY,
L.L.C., an Alabama limited
liability company, as the Company
By: /s/
Name: Xxxxxxxxxxx X. Xxxxx
Title:Vice President
