OFFSHORE MASTER AGREEMENT
MASTER AGREEMENT OF DISSOLUTION, DISTRIBUTION AND ASSIGNMENT
This Master Agreement of Dissolution, Distribution and Assignment (this
"Agreement"), dated as of August 27, 1997, is entered into by and between Enron
Equipment Procurement Company, a Delaware corporation ("Enron Procurement"), and
CNF Equipment, Inc., a Delaware corporation ("CNF Equipment"):
WHEREAS, Enron Procurement, acting on its own behalf, entered into that certain
Offshore Supply Contract dated November 1, 1995 (the "Supply Contract") with
EcoElectrica, L.P., a limited partnership formed under the laws of Bermuda
("EcoElectrica");
WHEREAS, in order to participate jointly in the performance of the Supply
Contract, Enron Procurement and CNF Equipment (hereinafter individually called a
"Partner" and collectively called the "Partners") associated themselves in the
form of a joint venture (the "Joint Venture") by entering into that certain
Joint Venture Agreement dated as of November 1, 1995;
WHEREAS, pursuant to the Limited Partnership Agreement of Enron/CNF Power
Equipment, L.P. dated as of December 13, 1996 (the "Partnership Agreement") and
a certificate of limited partnership filed December 17, 1996 with the Delaware
Secretary of State, the Partners formed Enron/CNF Equipment, L.P., a Delaware
limited partnership (the "Partnership"), with each Partner owning a 49% general
partner interest and a 1% limited partner interest in the Partnership;
WHEREAS, pursuant to the Assignment and Assumption Agreement dated as of
December 18, 1996 the Partners transferred and assigned all of their interests
in the Joint Venture to the Partnership, and continued the business of the Joint
Venture under the Partnership;
WHEREAS, the Partnership has not commenced supply under the Supply Contract and
substantially all of the costs and expenses of the Joint Venture to date have
been covered by Enron Engineering & Construction Company, a Delaware corporation
("EE&CC"), CNF Constructors, Inc., a Tenessee corporation, and their respective
affiliates;
WHEREAS, subject to the terms and conditions of this Agreement, the Partners
desire (i) to dissolve the Partnership and cause any and all right, title and
interest in and to the assets and property of the Partnership (the "Partnership
Property"), including, but not limited to, the Partners' interests in the Supply
Contract, to be distributed to the Partners as agreed to herein; (ii) CNF
Equipment to assign and transfer to Enron Procurement all of CNF Equipment's
interests in and to the Partnership Property to be distributed to CNF Equipment
pursuant to the dissolution of the Partnership (the "CNF Equipment Interest");
and (iii) Enron Procurement to thereafter perform under the Supply Contract in
lieu of the Partnership.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants, agreements and conditions contained herein, and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
in order to set forth the terms and conditions of the dissolution of the
Partnership, the distribution of Partnership Property and the assignment and
transfer to Enron Procurement of the CNF Equipment Interest, the parties hereto
hereby agree as follows:
ARTICLE I
Dissolution, Distribution and Assignment; Closing
Section 1.1 Dissolution. Subject to the terms and conditions of this Agreement,
and in accordance with Section 22.3(a) of the Partnership Agreement, the
Partners agree to dissolve the Partnership and to wind up expeditiously the
Partnership's affairs and business. In accordance with Section 22.4 of the
Partnership Agreement, Enron Procurement and CNF Equipment will act as the
liquidators of the Partnership.
Section 1.2 Distribution and Termination. Subject to the terms and conditions of
this Agreement, on the Effective Date (as hereinafter defined), all of the
Partnership Property shall be distributed to the Partners in accordance with the
Distribution and Assignment Agreement referred to in Section 1.6(ii) of this
Agreement. Upon such distribution, the Partnership's affairs shall be terminated
and the liquidators shall promptly cause to be filed all certificates and
instruments required to effect the termination of the Partnership, including a
Certificate of Cancellation in substantially the form attached hereto as Exhibit
1.2 to be filed with the Secretary of State of the State of Delaware.
Section 1.3 Assignment of CNF Equipment Interest. Immediately following the
distribution of the Partnership Property to the Partners on the Effective Date,
(i) CNF Equipment shall assign and transfer to Enron Procurement the CNF
Equipment Interest, including, but not limited to, all of CNF Equipment's
interest in the Supply Contract, and (ii) Enron Procurement shall accept the CNF
Equipment Interest, and will thereby assume and agree to perform all the duties
and obligations of CNF Equipment under the Supply Contract. Each of the Partners
acknowledges that upon the assignment of the CNF Equipment Interest to Enron
Procurement, Enron Procurement shall possess all of the rights, title and
interest which had been held by the Partnership in and to the Supply Contract.
Section 1.4 Time and Place of Closing on the Effective Date. Unless the Partners
agree otherwise in writing, and subject to the terms and conditions of this
Agreement, (i) the winding up of the Partnership's business and affairs, (ii)
the distribution to the Partners of all of their respective rights, title and
interest in and to the Partnership Property, and (iii) the assignment and
transfer of the CNF Equipment Interest shall each be consummated (the "Closing")
at the offices of Enron Procurement, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
or at such other place as the Partners may agree in writing. The date when the
Closing actually occurs is referred to in this Agreement as the "Effective
Date."
Section 1.5 Conditions Precedent to Closing. The Closing shall be held on a
mutually acceptable date within three (3) business days after the satisfaction
or mutual waiver of the following ("Conditions Precedent"):
(a) the mutually satisfactory execution and delivery of all Related Agreements
(as defined below);
(b) Enron Procurement receiving a Notice to Proceed (as defined in the Supply
Contract); and
(c) the satisfaction or waiver of all conditions precedent to the Notice to
Proceed Date (as defined in the Supply Contract).
Section 1.6 Related Agreements. Subject to the terms and conditions stated in
this Agreement along with the right for CNF Equipment and Enron Procurement to
mutually agree in writing to waive any requirement under this Section 1.6, at or
prior to the Effective Date the appropriate parties shall execute and deliver
the following agreements (the agreements listed in this Section 1.6 are
collectively referred to in this Agreement as the "Related Agreements") and
where applicable CNF Equipment and Enron Procurement shall cause their
affiliates to deliver:
(i) The Distribution and Assignment Agreement, in the form attached hereto
as Exhibit 1.6(i), providing for the distribution of the Partnership
Property to each of the Partners (the "Distribution and Assignment
Agreement");
(ii) The Assignment and Assumption Agreement, in the form attached hereto
as Exhibit 1.6(ii), providing for the assignment and transfer by CNF
Equipment of the CNF Equipment Interest to Enron Procurement, and the
acceptance and assumption of the CNF Equipment Interest by Enron
Procurement (the "CNF Equipment Assignment Agreement");
(iii)The acknowledgment and consent of EcoElectrica, L.P. of the
transactions contemplated by this Agreement in substantially the form
attached to the Distribution and Assignment Agreement and the CNF
Equipment Assignment Agreement (the "Consents"), provided, however,
that in the event CNF Equipment's affiliated partner in EcoElectrica
has executed both Consents, but Enron Procurement's affiliated partner
in EcoElectrica has not executed both Consents within three (3)
business days after the Notice to Proceed Date, then Enron Procurement
will be deemed to have waived the requirement under Section 1.6 (iii);
(iv) The letter agreement (the "Enron Development/KESI Cancellation
Letter") between Enron Development Corp. ("Enron Development") and
Kenetech Energy Systems, Inc. ("KESI"), in substantially the form
attached hereto as Exhibit 1.6(iv), cancelling the Side Letter
Agreement dated November 1, 1995 between Enron Development and KESI
pursuant to which each has the right to cancel the Supply Contract and
that certain Offshore Supply Contract dated as of November 1, 1995,
originally between EcoElectrica, L.P. and Enron Equipment Procurement
Company (the "Offshore Supply Contract");
(v) Except to the extent waived in accordance with the terms thereof, all
documents required to be delivered at or prior to the closing
contemplated by the Master Agreement of Dissolution, Distribution and
Assignment (the "Construction L.P. Dissolution Agreement") entered
into on the date of this Agreement between Enron Power I (Puerto Rico)
("Enron Power") and CNF Penuelas, Inc. ("CNF Penuelas") relating to
the dissolution of Enron Power/CNF ▇▇▇▇▇▇▇▇, ▇.▇., a Delaware limited
partnership (the "Construction L.P.") and the distribution and
assignment of its property (collectively, the "Construction L.P.
Agreements");
(vi) The guaranty of Kenetech Corporation, a Delaware corporation
("Kenetech"), in the form attached hereto as Exhibit 1.6(vi), pursuant
to which Kenetech unconditionally guarantees any and all obligations
of CNF Equipment under Section 3.1, Section 3.2, Section 3.3, Section
5.1 and Section 5.2 of this Agreement (the "Kenetech Guaranty");
(vii)The guaranty of Enron Power Corp., a Delaware corporation, in the
form attached hereto as Exhibit 1.6(vii), pursuant to which Enron
Power Corp. unconditionally guarantees any and all obligations of
Enron Procurement under Section 3.1, Section 5.1 and Section 5.2;
(viii) The Global Change Order, in substantially the form attached hereto
as Exhibit 1.6(viii), relating to the consent and amendment required
by the lenders to the project;
(ix) The Change Order, in substantially the form attached hereto as Exhibit
1.6(ix), relating to the LPG storage facility (the "LPG Change
Order"), provided, however, that in the event the LPG Change Order has
not been executed within three (3) business days after the Notice to
Proceed Date, then Enron Procurement will be deemed to have waived the
requirement under Section 1.6 (ix);
(x) The letter agreement between CNF Industries, Inc. and Enron Power I,
in the form attached hereto as Exhibit 1.6(x), releasing the guaranty
of CNF Industries, Inc. granted pursuant to Section 11.3 of the
Partnership Agreement; and
(xi) The letter agreement between Enron Power Corp. and CNF Equipment, in
the form attached hereto as Exhibit 1.6(xi), releasing the guaranty of
Enron Power Corp. granted pursuant to Section 11.3 of the Partnership
Agreement.
ARTICLE II
Representations and Warranties
Section 2.1 Representations and Warranties of CNF Equipment. CNF Equipment
represents and warrants to Enron Procurement that:
(a) Organization of CNF Equipment. CNF Equipment is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware and has all requisite corporate power and authority to
own, lease, operate and otherwise hold all of its properties and assets and
to carry on its business as presently conducted and is duly qualified to do
business in each jurisdiction in which the nature of its business as now
conducted or its assets makes such qualification necessary, except where
the failure to be so qualified would not have a material adverse effect on
it.
(b) Authorization and Validity of Agreement. CNF Equipment has all necessary
corporate power and authority to enter into this Agreement and each of the
Related Agreements to which it is a party and to perform its obligations
hereunder and thereunder, and the execution, delivery and performance by
CNF Equipment of this Agreement and each of the Related Agreements to which
it is a party has been duly and validly authorized by all necessary
corporate action. This Agreement has been duly executed and delivered by
CNF Equipment and at or prior to the Effective Date each of the Related
Agreements to which CNF Equipment is a party will have been duly executed
and delivered by CNF Equipment, and, assuming this Agreement and each of
the Related Agreements to which CNF Equipment is a party constitute legal,
valid and binding obligations of the other parties thereto, when executed
and delivered will constitute legal, valid and binding obligations of CNF
Equipment, enforceable against it in accordance with their terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(c) Consent and Approval; No Conflict. Neither the execution and delivery of
this Agreement or the Related Agreements to which CNF Equipment is a party
nor the consummation of the transactions and performance of the terms and
conditions contemplated hereby or thereby will (i) conflict with or result
in any breach of any provision of the certificate of incorporation or
bylaws of CNF Equipment; (ii) except as otherwise provided in this
Agreement, require any consent, approval, authorization or permit of, or
filing with or notification to, any governmental or regulatory authority,
except (A) any regulatory approvals or routine governmental consents
normally acquired after the consummation of transactions such as
transactions of the nature contemplated by this Agreement or (B) where it
is reasonably expected that the failure to obtain such consent, approval,
authorization or permit, or to make such filing or notification, would not
prevent or delay in any material respect the consummation of the
transactions contemplated hereby or thereby; (iii) result in a default (or
give rise to any right of termination, cancellation or acceleration) under
any of the terms, conditions or provisions of any agreement, instrument or
obligation to which CNF Equipment is a party or by which CNF Equipment may
be bound and to which any of the Partnership Property is subject, except
for such defaults (or rights of termination, cancellation or acceleration)
as to which requisite waivers or consents have been obtained or will be
obtained prior to the Closing; (iv) violate any order, writ, injunction,
decree, statute, rule or regulation to which CNF Equipment is subject and
which relate to any of its assets; or (v) result in the imposition or
creation of any lien, charge or encumbrance upon any Partnership Property
under any agreement by which Partnership Property is bound.
(d) Ownership of Partnership Interests; Title. As of the date of this Agreement
and immediately prior to the Closing, CNF Equipment is and will be the
owner of record and beneficially of a 49% general partner interest and a 1%
limited partner interest in the Partnership, and it has not received any
notice of adverse claim to the ownership of such interests and does not
have any reason to know of any such adverse claim.
(e) No Liens. CNF Equipment shall transfer and assign the CNF Equipment
Interest to Enron Procurement pursuant to the CNF Equipment Assignment
Agreement free and clear of all liens, encumbrances or similar rights.
(f) Solvency. As of the date hereof CNF Equipment is Solvent, and following the
transfer of the CNF Equipment Interest to Enron Procurement pursuant to the
CNF Equipment Assignment Agreement and the receipt by CNF Equipment of the
payment contemplated by Section 3.1(a) and Section 3.1(b) (i) and (ii) of
this Agreement, CNF Equipment shall be Solvent. For purposes of this
Section 2.1(f) the term "Solvent" shall mean: (i) the assets of CNF
Equipment, at a fair valuation, exceed CNF Equipment's total liabilities
(including contingent, subordinated, unmatured and unliquidated
liabilities); (ii) based on current projections, which are based on
underlying assumptions which provide a reasonable basis for the projections
and which reflect CNF Equipment 's judgment based on present circumstances
of the most likely set of conditions and CNF Equipment's most likely course
of action for the period projected (including any payments that may be
received by CNF Equipment under Section 3.1), CNF Equipment has sufficient
cash flow to enable it to pay its debts as they mature; and (iii) CNF
Equipment does not have unreasonably small capital with which to engage in
its anticipated business. For purposes of this Section 2.1(f), the "fair
valuation" of the assets of CNF Equipment means a valuation on the basis of
the amount which may be realized within a reasonable time, either through
collection or sale of such assets at the regular market value, conceiving
the latter as the amount which could be obtained for the property in
question within such period by a capable and diligent businessman from an
interested buyer who is willing to purchase under ordinary selling
conditions, including obtaining necessary consents.
(g) Fair Consideration. The consideration payable to CNF Equipment pursuant to
Article III of this Agreement equals or exceeds the reasonable equivalent
value of the CNF Equipment Interest to be transferred to Enron Procurement
pursuant to the CNF Equipment Assignment Agreement.
(h) Delivery of CNF Equipment Work Product. CNF Equipment and affiliated
parties have delivered to Enron Procurement all work, of any kind or
nature, related to the Project (as defined in the Supply Contract) in the
possession or under the control of such person, including but not limited
to: drawings, specifications, calculations, purchase orders, quotations,
estimates, budgets, cost reports, cost forecasts, labor or manpower
projections or forecasts, cash flow projections, schedules, work plans,
transportation studies, installation plans or procedures, arrangements with
subcontractors or subsuppliers, monthly reports, daily logs, engineering
studies, correspondence with or between any party related to the Project
and including that with any possible subcontractors, monthly reports, daily
logs, engineering studies, and related data.
(i) No Agreements, Claims, Actions or Proceedings. Except for this
Agreement, the Related Agreements, and any agreement entered into
jointly by CNF Equipment and Enron Procurement, CNF Equipment is not a
party to any contract, agreement or arrangement relating to the
Partnership Property or the Supply Contract which binds or purports to
bind the Partnership or its assets. Except as disclosed on Schedule
2.1(i), as of the Execution Date and, except as may be provided on an
amended Schedule 2.1(i) delivered by CNF Equipment at or prior to the
Effective Date, as of the Effective Date there are no claims, actions
or proceedings pending that arise from activities conducted by CNF
Equipment, its affiliates or their representatives that relate to the
Partnership, Partnership Property or the Supply Contract and, to the
knowledge of CNF Equipment, no such claims, actions or proceedings are
threatened.
Section 2.2 Representations and Warranties of Enron Procurement. Enron
Procurement hereby represents and warrants to CNF Equipment that:
(a) Organization of Enron Procurement. Enron Procurement is a corporation duly
organized, validly existing and in good standing under the laws of the
state of Delaware and has all requisite corporate power and authority to
own, lease, operate and otherwise hold all of its properties and assets and
to carry on its business as presently conducted and is duly qualified to do
business in each jurisdiction in which the nature of its business as now
conducted or its assets makes such qualification necessary, except where
the failure to be so qualified would not have a material adverse effect on
it.
(b) Authorization and Validity of Agreement. Enron Procurement has all
necessary corporate power and authority to enter into this Agreement and
each of the Related Agreements to which it is a party and to perform its
obligations hereunder and thereunder, and the execution, delivery and
performance by Enron Procurement of this Agreement and each of the Related
Agreements to which it is a party has been duly and validly authorized by
all necessary corporate action. This Agreement has been duly executed and
delivered by Enron Procurement and at or prior to the Effective Date each
of the Related Agreements to which Enron Procurement is a party will have
been duly executed and delivered by Enron Procurement, and, assuming this
Agreement and each of the Related Agreements to which Enron Procurement is
a party constitute legal, valid and binding obligations of the other
parties thereto, when executed and delivered will constitute legal, valid
and binding obligations of Enron Procurement, enforceable against it in
accordance with their terms, except as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
at law).
(c) Consent and Approval; No Conflict. Neither the execution and delivery of
this Agreement or the Related Agreements to which Enron Procurement is a
party nor the consummation of the transactions and performance of the terms
and conditions contemplated hereby or thereby will (i) conflict with or
result in any breach of any provision of the certificate of incorporation
or bylaws of Enron Procurement; (ii) except as otherwise provided in this
Agreement, require any consent, approval, authorization or permit of, or
filing with or notification to, any governmental or regulatory authority,
except (A) any regulatory approvals or routine governmental consents
normally acquired after the consummation of transactions such as
transactions of the nature contemplated by this Agreement or (B) where it
is reasonably expected that the failure to obtain such consent, approval,
authorization or permit, or to make such filing or notification, would not
prevent or delay in any material respect the consummation of the
transactions contemplated hereby or thereby; (iii) result in a default (or
give rise to any right of termination, cancellation or acceleration) under
any of the terms, conditions or provisions of any agreement, instrument or
obligation to which Enron Procurement is a party or by which Enron
Procurement may be bound and to which any of the Partnership Property is
subject, except for such defaults (or rights of termination, cancellation
or acceleration) as to which requisite waivers or consents have been
obtained or will be obtained prior to the Closing; (iv) violate any order,
writ, injunction, decree, statute, rule or regulation to which Enron
Procurement is subject and which relate to any of its assets; or (v) result
in the imposition or creation of any lien, charge or encumbrance upon any
Partnership Property under any agreement by which the Partnership Property
is bound.
(d) Ownership of Partnership Interests; Title. As of the date of this Agreement
and immediately prior to the Closing, Enron Procurement is and will be the
owner of record and beneficially of a 49% general partner interest and a 1%
limited partner interest in the Partnership, and it has not received any
notice of adverse claim to the ownership of such interests and does not
have any reason to know of any such adverse claim.
(e) No Claims. As of the date of this Agreement and, except as may be set forth
on an amended Schedule 2.1(i) delivered by CNF Equipment pursuant to
Section 2.1(i), immediately prior to the Closing, there are no claims,
actions or proceedings pending that arise from the gross negligence or
willful misconduct of CNF Equipment, its affiliates or their
representatives that relate to the Partnership, Partnership Property or the
Supply Contract and, to the knowledge of Enron Procurement, no such claims,
actions or proceedings are threatened.
ARTICLE III
Additional Covenants and Agreements
Section 3.1 Certain Payments to CNF Equipment.
(a) Payment on the Execution Date. Subject to the terms and conditions of this
Agreement, Enron Procurement shall pay to CNF Equipment on the Execution
Date, by wire transfer or certified bank check, an aggregate of Seven
Hundred Thousand ($700,000) in partial consideration for the transactions
contemplated in this Agreement.
(b) Payments Following the Effective Date. Subject to, and conditioned upon the
satisfaction or valid waiver of the Conditions Precedent, Enron Procurement
shall pay to CNF Equipment, by wire transfer or a certified bank check, the
following amounts:
(i) Two Million Four Hundred Thousand Dollars ($2,400,000 on the Effective
Date to CNF Equipment or its designee for the out-of-pocket costs
incurred and paid by CNF Equipment and its affiliates on behalf of the
Partnership and constituting Contract Costs (as defined in the
Partnership Agreement) through April 30, 1997 for which CNF Equipment
and its affiliates had not been reimbursed as of April 30, 1997; and
(ii) Nine Million Nine Hundred Thousand Dollars ($9,900,000) on the
Effective Date.
(c) Cancellation Option. In the event a Notice to Proceed under the Supply
Contract is not issued by EcoElectrica, L.P. to Enron Procurement by
December 15, 1997, Enron Procurement shall have the right, but not the
obligation, to terminate this Agreement by giving written notice of such
election to CNF Equipment on or prior to December 19, 1997 (the "Revocation
Option"). Should Enron Procurement elect to exercise the Revocation Option,
CNF Equipment shall be obligated to promptly repay to Enron Procurement
(and in any event no later than December 31, 1997) any and all amounts paid
to CNF Equipment pursuant to this Section 3.1 of this Agreement. In the
event that Enron Procurement elects to exercise the Revocation Option, and
subject to the repayment by CNF Equipment to Enron Procurement of any and
all amounts owed by CNF Equipment hereunder, then this Agreement shall be
considered terminated effective upon delivery by Enron Procurement of
notice of the Revocation Option, and thereafter Enron Procurement shall
have no further payment obligations under the Agreement and CNF Equipment
and Enron Procurement shall continue as partners.
(d) Cancellation of Project. In the event the Project is terminated or
cancelled prior to the receipt of a Notice to Proceed (including, without
limitation, because of the denial of a permit or license necessary to the
Project or the termination or cancellation of the Power Purchase Agreement
(as defined in the Supply Contract)), CNF Equipment shall be obligated to
promptly repay Enron Procurement (in any event no later than thirty (30)
days after notice of such termination or cancellation is given by Enron
Procurement to CNF Equipment) any and all amounts paid to CNF Equipment
pursuant to this Section 3.1 of the Agreement. In the event that the
Project is terminated or cancelled, and subject to the repayment by CNF
Equipment to Enron Procurement of any and all amounts owed by CNF Equipment
hereunder, then this Agreement shall be considered terminated effective
upon delivery by Enron Procurement of notice of the Project cancellation,
and thereafter Enron Procurement shall have no further payment obligations
under the Agreement and CNF Equipment and Enron Procurement shall continue
as partners.
Section 3.2 Alteration of Supply Contract and Onshore Construction Contract.
Prior to the Effective Date, CNF Equipment agrees to assist Enron Procurement in
the negotiations with EcoElectrica L.P. pertaining to the Global Change Order
and the LPG Change Order in order to minimize modifications or alterations to
the Supply Contract and the Onshore Construction Contract that result in a
negative impact on, or decrease the profit accruing under, the Supply Contract
and the Onshore Construction Contract.
Section 3.3 Continued Existence. CNF Equipment shall maintain its corporate
existence as a Delaware corporation in good standing under the laws thereunder
for a period equal to the earlier of (x) one year following the date of this
Agreement or (y) the Notice to Proceed Date.
Section 3.4 Certain Other Obligations. Enron Procurement acknowledges that in
the event that the Closing occurs, CNF Equipment will not be obligated to pay
the "Base Rate Fee" or "Additional Risk Fee" referred to in Section 2.1 of the
Partnership Agreement. In addition, Enron Procurement acknowledges that between
the Effective Date and the earlier of the Effective Date or the termination of
this Agreement CNF Equipment will not be performing any obligations under the
Partnership Agreement relating to the performance of the Supply Contract,
including the obligation under Article 11 with respect to obtaining a payment
and performance bond.
ARTICLE IV
Arbitration
Section 4.1 Management Resolution of Disputes. In the event of any claim,
dispute, disagreement or controversy arising out of or relating to this
Agreement or the transactions contemplated herein or the breach or termination
of this Agreement or any Related Agreement (each, hereinafter referred to as a
"Dispute"), which the parties to this Agreement have been unable to settle or
agree upon within a period of fifteen (15) days after such Dispute arises, each
party shall nominate a senior officer of its management to meet at a mutually
agreed time and place not later than thirty (30) days after the Dispute has
arisen to attempt to resolve such Dispute. Should a resolution of such Dispute
not be obtained within ten (10) days after the meeting of senior officers for
such purpose, or such longer period as the parties may mutually agree upon, then
either party may by notice to the other submit the Dispute to arbitration in
accordance with the provisions of Section 4.2 of this Agreement.
Section 4.2 Binding Arbitration of Disputes. Any Dispute which is not settled in
accordance with the provisions of Section 4.1 of this Agreement shall be
submitted to binding arbitration to be conducted in accordance with the
following procedure:
(a) The party seeking arbitration hereunder may request such arbitration in
writing, which writing shall include a clear statement of the matter(s) in
dispute and shall name one arbitrator appointed by such party. Within
twenty (20) business days after receipt of such request, the other party
shall appoint one arbitrator, or in default thereof, such arbitrator shall
be named as soon as practicable by the Arbitration Committee of the
American Arbitration Association, and the two arbitrators so appointed
shall name a third arbitrator within ten (10) business days, or failing
such agreement on a third arbitrator by the two arbitrators so appointed, a
third arbitrator shall be appointed by the Arbitration Committee of the
American Arbitration Association.
(b) The arbitration hearing shall be held in New York, New York, on at least
twenty (20) business days' prior written notice to the parties. Except as
otherwise provided herein, the proceedings shall be conducted in accordance
with the Commercial Arbitration Rules and procedures of the American
Arbitration Association. Any decision of the arbitrators shall be joined in
by at least two of the arbitrators and shall be set forth in a written
award which shall state the basis of the award and shall include both
findings of fact and conclusions of law. Notwithstanding the foregoing, in
the case of any monetary dispute or claim for damages, the amount of which
is contested, each party shall submit in writing a proposed arbitration
award at the commencement of the arbitration hearing, and the arbitrators
shall be required to adopt in full the proposed arbitration award of one of
the parties with respect to such monetary amount or damages. Any award
rendered pursuant to the foregoing, which may include an award or decree of
specific performance hereunder, shall be final and binding on the parties
and not subject to review or appeal, and judgment thereon may be entered or
enforcement thereof sought by either party in a court of competent
jurisdiction.
(c) Notwithstanding the foregoing, nothing contained herein shall be deemed to
give the arbitrators appointed pursuant to the foregoing any authority,
power or right to alter, change, amend, modify, waive, add to or delete
from any of the provisions of this Agreement or the Related Agreements.
(d) The losing party shall bear all costs of the arbitration including costs of
all arbitrators, both parties' attorneys' fees and disbursements and expert
fees. In the event that the arbitrators allocate liability among the
parties, then the costs of the arbitration shall be shared pro rata by the
parties.
(e) Each of the parties to this Agreement agree that compliance by a party with
the provisions of subparagraphs (a) through (e) of this Section 4.2 shall
be a complete defense to any suit, action or proceeding instituted in any
federal or state court, or before any administrative tribunal by another
party with respect to any controversy or dispute arising under or pursuant
to this Agreement and which is subject to arbitration as set forth herein,
other than a suit or action alleging non-compliance with a final and
binding arbitration award rendered hereunder.
Section 4.3 Enforceability in Federal and State Court. The agreement to
arbitrate set forth in Section 4.2 shall be enforceable in either federal or
state court. The enforcement of such agreement and all procedural aspects
thereof, including the construction and interpretation of this agreement to
arbitrate, the scope of the arbitrable issues, allegations of waiver, delay or
defenses as to arbitrability, and the rules (except as otherwise expressly
provided herein) governing the conduct of the arbitration, shall be governed by
and construed pursuant to the United States Arbitration Act, 9 U.S.C. 1-16. In
deciding the substance of any such claim, dispute or disagreement, the
arbitrators shall apply the substantive laws of the State of Delaware; provided,
however, that the arbitrators shall have no authority to award punitive damages
under any circumstances (whether it be exemplary damages, treble damages, or any
other penalty or punitive type of damages) regardless of whether such damages
may be available under Delaware law, the parties to this Agreement hereby
waiving their right, if any, to recover punitive damages in connection with any
such claims, disputes or disagreements.
ARTICLE V
Indemnification
Section 5.1 Mutual Indemnification. Each of Enron Procurement and CNF Equipment
(each an "Indemnifying Party") hereby agrees to indemnify, defend and hold
harmless the other, its directors, officers, and employees, its controlled and
controlling persons and persons under common control, and their respective
directors, officers and employees (collectively "related persons"), from and
against all Claims (as hereinafter defined) asserted against, resulting to,
imposed upon or incurred by such party or such party's related persons (an
"Indemnified Person"), directly or indirectly, by reason of, arising out of, or
resulting from (a) the inaccuracy or breach of any representation or warranty of
the Indemnifying Party contained in this Agreement and (b) the breach of any
covenant or agreement of the Indemnifying Party contained in this Agreement.
"Claim" shall include (i) all debts, liabilities and obligations; (ii) losses,
damages, costs and expenses including, without limitation, interest (including
prejudgment interest in any litigated matter), penalties, court costs and
reasonable attorneys' fees and expenses; and (iii) all demands, claims, actions,
costs of investigation, causes of action, proceedings, arbitrations, judgments,
settlements and assessments, whether or not ultimately determined to be valid ;
provided, however, that "Claims" shall not include any of the foregoing to the
extent covered by insurance maintained by or for the benefit of the applicable
Indemnified Person; however the Indemnifying Party shall be liable for the
deductible and any uninsured portion of the applicable Claim.
Section 5.2 Additional Indemnification. In addition to its obligations under
Section 5.1, Enron Procurement hereby agrees to indemnify, defend and hold
harmless CNF Equipment and its related persons from and against (a) all Claims
asserted against, imposed upon or incurred by CNF Equipment or any of its
related persons by reason of, arising out of, or resulting from the performance
of the Supply Contract before or after the Closing (including any Claim arising
from activities conducted jointly by Enron Procurement and CNF Equipment, their
affiliates and representatives) and (b) all Claims asserted against, imposed
upon or incurred by CNF or any of its related persons by reason of, arising out
of, or resulting from the performance of the Supply Contract after the Effective
Date but prior to the termination of this Agreement under either Section 3.1(c)
or Section 3.1(d), except for Claims under Section 5.1 and Claims that shall
have been determined by the arbitrators under Article IV to have resulted from
(i) the sole negligence of CNF Equipment or its related persons, or (ii) the
willful misconduct of CNF Equipment or its related persons (such excluded Claims
under (i) and (ii) referred to as a "CNF Equipment Obligation"). CNF Equipment
shall indemnify, defend and hold harmless Enron Procurement and its related
persons from and against all Claims arising out of CNF Equipment Obligations,
but only if the aggregate Claims incurred by Enron Procurement and its related
persons arising from CNF Equipment Obligations exceeds $625,000, and then only
with respect to the amount in excess of $625,000.
ARTICLE VI
Notices
Section 6.1 Notices. Any notice 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, to the extent reasonably practicable, be
sent by telefax, and if not reasonably practicable to send by telefax, then by
hand delivery, overnight courier, telegram or registered mail, to the other
party at such address as set forth below:
If delivered to CNF Equipment:
CNF Constructors, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telefax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Kenetech Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Telefax No.: (▇▇▇) ▇▇▇-▇▇▇▇
If delivered to Enron Procurement:
Enron Equipment Procurement Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telefax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Enron Engineering & Construction Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telefax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Each party shall have the right to change the place to which notice 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 deliveries in like
manner to the other parties. Without limiting any other means by which a party
to this Agreement maybe able to prove that a notice has been received by another
party, a notice shall be deemed to be duly received: (a) if delivered by hand,
overnight courier or telegram, the date when left at the address of the
recipient; (b) if sent by registered mail, the date of the return receipt; or
(c) if sent by telefax, upon receipt by the sender of an acknowledgment or
transmission report generated by the machine from which the telefax was sent
indicating that the telefax was sent in its entirety to the recipient's telefax
number.
ARTICLE VII
Miscellaneous
Section 7.1 Confidentiality. Each Partner acknowledges that Article 14 of the
Partnership Agreement shall survive the dissolution and termination of the
Partnership, and that no Partner shall disclose any Confidential Information (as
defined in the Partnership Agreement) to any third party except as provided
therein. Furthermore, the terms and conditions of this Agreement and the
transactions contemplated hereby shall remain subject to the terms and
conditions of that certain Confidentiality Agreement dated as of March 4, 1997
among EE&CC, CNFC Industries Inc. and Kenetech.
Section 7.2 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party.
Section 7.3 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to the
choice of law principles thereof.
Section 7.4 Entire Agreement. This Agreement (including the Related Agreements
and other agreements incorporated herein) and the exhibits hereto contain the
entire agreement between the parties with respect to the subject matter hereof
and there are no agreements, understandings, representations or warranties
between the parties other than those set forth or referred to herein.
Section 7.5 Expenses. Whether the transactions contemplated hereby are or are
not consummated, all legal and other costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such costs and expenses.
Section 7.6 Headings; Definitions. The section and article headings contained in
this Agreement are inserted for convenience of reference only and will not
affect the meaning or interpretation of this Agreement. All references to
Sections or Articles contained herein mean Sections or Articles of this
Agreement unless otherwise stated. All capitalized terms defined herein are
equally applicable to both the singular and plural forms of such terms.
Section 7.7 Amendments and Waivers. This Agreement may not be modified or
amended except by an instrument or instruments in writing signed by the party
against whom enforcement of any such modification or amendment is sought. Any
party hereto may, only by an instrument in writing, waive compliance by the
other parties hereto with any term or provision of this Agreement on the part of
such other party hereto to be performed or complied with. The waiver by any
party hereto of a breach of any term or provision of this Agreement shall not be
construed as a waiver of any subsequent breach.
Section 7.8 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any adverse manner to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
Section 7.9 Additional Documents. In connection with this Agreement and the
transactions contemplated hereby, each party hereto agrees to execute and
deliver, or cause the execution and delivery of, such additional documents and
instruments, and to perform such additional acts, as may be necessary as
appropriate to effectuate, carry out and perform all of the terms, provisions
and conditions of this Agreement and the transactions contemplated hereby.
Section 7.10 Survival. The provisions of Article IV and V shall survive the
termination of this Agreement for a period of five (5) years from the Execution
Date.
IN WITNESS WHEREOF, this Agreement has been signed by or on behalf of each of
the parties as of the day first above written.
ENRON EQUIPMENT PROCUREMENT COMPANY
By: _____________________________
Name:
Title:
CNF ▇▇▇▇▇▇▇▇, Inc.
By: _____________________________
Name:
Title:
OFFSHORE CERTIFICATE
Exhibit 1.2
CERTIFICATE OF CANCELLATION
OF
CERTIFICATE OF LIMITED PARTNERSHIP
OF
ENRON/CNF EQUIPMENT, L.P.
This Certificate of Cancellation, dated as of [_____], 1997, is being filed by
the undersigned in the Office of the Secretary of State of the State of Delaware
(the "Secretary of State") in accordance with the provisions of 6 Del.C. 17-203
to cancel the Certificate of Limited Partnership of Enron/CNF Power Equipment,
L.P. (the "Partnership").
1. The name of the limited partnership is Enron/CNF Equipment, L.P.
2. The Partnership filed in the Office of the Secretary of State a Certificate
of Limited Partnership on December 17, 1996.
3. The reason for the filing of this Certificate of Cancellation is that the
Partnership has been dissolved and the winding up of the Partnership has
been completed.
4. This Certificate of Cancellation shall be effective immediately upon
filing.
IN WITNESS WHEREOF, the undersigned have executed this Certificate of
Cancellation as of the date first-above written.
GENERAL PARTNERS:
Enron Equipment Procurement Company, a Delaware corporation
By: _________________________________
Name:
Title:
CNF Equipment, Inc., a Delaware corporation
By: _________________________________
Name:
Title:
OFFSHORE
Exhibit 1.6(i)
DISTRIBUTION AND ASSIGNMENT AGREEMENT
This Distribution and Assignment Agreement (this "Agreement"), dated as of
[______], 1997, is entered into by and among Enron/CNF Equipment, L.P., a
Delaware limited partnership (the "Partnership"), Enron Equipment Procurement
Company, a Delaware corporation ("Enron Procurement"), and CNF Equipment, Inc.,
a Delaware corporation ("CNF Equipment").
WHEREAS, pursuant to the Limited Partnership Agreement of Enron/CNF Equipment,
L.P. dated as of December 13, 1996 (the "Partnership Agreement") and a
certificate of limited partnership filed December 16, 1996 with the Delaware
Secretary of State, Enron Procurement and CNF Equipment (hereinafter
individually called a "Partner" and collectively called the "Partners") formed
the Partnership, with each Partner owning a 49% general partner interest and a
1% limited partner interest in the Partnership;
WHEREAS, the Partners are the sole limited partners and general partners of the
Partnership;
WHEREAS, pursuant to that certain Master Agreement of Dissolution, Distribution
and Assignment, dated [_________], 1997 (the "Master Agreement"), the Partners
agreed, among other things, to dissolve the Partnership in accordance with
Section 22.3(a) of the Partnership Agreement;
WHEREAS, as contemplated by the Master Agreement, the Partners have paid all
debts and liabilities of the Partnership (including, without limitation, all
expenses incurred in liquidation) or have otherwise made adequate provisions for
such debt and liabilities;
WHEREAS, the Partners, as liquidators of the Partnership, have completed, or
have otherwise made adequate provisions for, all actions necessary to wind up
the affairs of the Partnership in accordance with the Partnership Agreement and
Section 17-803 of the Delaware Revised Uniform Limited Partnership Act, as
amended (the "Act");
WHEREAS, pursuant to this Agreement, the Partners wish to distribute to each
Partner a 50% undivided interest in the right, title and interest in and to all
of the assets owned, leased or held by the Partnership as of the date hereof,
whether tangible or intangible (the "Partnership Property," including, without
limitation, all of the assets and property described in Exhibit A hereto);
NOW THEREFORE, in consideration of the mutual covenants set forth below and
other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby acknowledge and ratify their agreement as
follows:
Distribution and Assignment. The Partners, as liquidators of the Partnership,
hereby distribute, assign, convey and deliver (i) to Enron Procurement and its
successors and assigns a 50% undivided interest in and to the Partnership
Property, and (ii) to CNF Equipment and its successors and assigns a 50%
undivided interest in and to the Partnership Property.
Acceptance of Assignment. Each of the Partners hereby accepts the assignment of
its 50% undivided interest in the Partnership Property and acknowledges that
such assignment constitutes a complete return of its capital contribution and a
complete distribution of its interest in the Partnership and all of the
Partnership's property and assets.
Acknowledgment and Consent to Release of Partnership. Each Partner acknowledges,
consents to and agrees to be bound by, the terms and conditions set forth in the
attached Acknowledgment, Consent and Release.
Effective Date. This Agreement is effective as of the date first above written.
Certificate of Cancellation. Upon the distribution and assignment of the
Partnership Property pursuant to this Agreement, the Partners agree to file a
Certificate of Cancellation with the Secretary of State of the State of Delaware
in order to cancel the Certificate of Limited Partnership of the Partnership in
accordance with Section 17-203 of the Act.
Further Assurances. The parties shall take all acts and execute all documents as
any other party may reasonably request to fully carry out and effectuate the
transactions contemplated by this Agreement.
Miscellaneous. This Agreement (including the Acknowledgment, Consent and Release
attached hereto): (i) shall be governed by and construed in accordance with the
laws of the State of Delaware; (ii) shall not be amended or modified except by
an instrument in writing executed by all parties; (iii) shall be binding upon
the successors and assigns of the respective parties; and (iv) may be executed
in several counterparts, all of which together shall constitute one agreement
binding on all parties hereto notwithstanding that all parties have not signed
the same counterpart.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
as of the date first above written.
THE PARTNERSHIP:
ENRON/CNF EQUIPMENT, L.P.
a Delaware limited partnership
By: ENRON EQUIPMENT PROCUREMENT COMPANY
as a General and Limited Partner
By: ______________________________
Name:
Title:
By: CNF EQUIPMENT, INC.
as a General and Limited Partner
By: ______________________________
Name:
Title:
THE PARTNERS:
ENRON EQUIPMENT PROCUREMENT COMPANY
a Delaware corporation
By: ______________________________
Name:
Title:
CNF EQUIPMENT, INC.
a Delaware corporation
By: ______________________________
Name:
Title:
ACKNOWLEDGMENT CONSENT AND RELEASE
THE UNDERSIGNED, EcoElectrica, L.P., hereby acknowledges and agrees that it has
been informed of and consents to the distribution and assignment of the
Partnership Property pursuant to the terms and conditions of the Distribution
and Assignment Agreement (the "Agreement") to which this Acknowledgment, Consent
and Release is attached. Each capitalized term used herein and not otherwise
defined herein shall have the definition assigned thereto in the Agreement.
EcoElectrica, L.P. hereby further agrees that, subject to the execution and
delivery of the Assignment and Assumption Agreement whereby CNF Equipment
assigns its interest in the Partnership Property to Enron Procurement, all
references to "Supplier" and "Contractor" in that certain Offshore Supply
Contract dated as of November 1, 1995 (the "Supply Contract"), originally
between EcoElectrica, L.P. and Enron Procurement, shall refer to Enron
Procurement. Finally, EcoElectrica, L.P. hereby releases the Partnership, and
each of the Partners solely in their capacities as general partners and limited
partners in the Partnership (the "Released Parties"), from all duties and
obligations under the Supply Contract and agrees to accept performance of all
such duties and obligations from Enron Procurement in place of the Partnership
and the Released Parties.
ECOELECTRICA, L.P.,
a Bermuda exempted limited partnership
By: KES Bermuda, Inc.
a Delaware corporation, its general partner
By: ______________________________
Name:
Title:
By: Buenergia, B.V.
a Dutch limited liability company, its general
partner
By: ______________________________
Name:
Title:
OFFSHORE ASSIGNMENT
Exhibit 1.6(ii)
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement (this "Agreement"), dated as of
[______], 1997, is entered into by and between Enron Equipment Procurement
Company, a Delaware corporation ("Enron Procurement") and CNF Equipment, Inc., a
Delaware corporation ("CNF Equipment").
WHEREAS, pursuant to the Limited Partnership Agreement of Enron/CNF Equipment,
L.P. dated as of December 13, 1996 (the "Partnership Agreement") and a
certificate of limited partnership filed December 16, 1996 with the Delaware
Secretary of State, Enron Procurement and CNF Equipment (hereinafter
individually called a "Partner" and collectively called the "Partners") formed
the Partnership, with each Partner owning a 49% general partner interest and a
1% limited partner interest in the Partnership;
WHEREAS, pursuant to that certain Master Agreement of Dissolution, Distribution
and Assignment, dated [________], 1997 (the "Master Agreement"), the Partners
agreed, among other things, to dissolve the Partnership in accordance with
Section 22.3(a) of the Partnership Agreement;
WHEREAS, pursuant to that certain Distribution and Assignment Agreement, dated
as of the date hereof (the "Distribution and Assignment Agreement"), the
Partners distributed, assigned, conveyed, and delivered to each Partner a 50%
undivided interest in the right, title and interest in and to all of the assets
owned, leased or held by the Partnership as of the date hereof, whether tangible
or intangible (the "Partnership Property," including, without limitation, all of
the assets and property described in Exhibit A hereto);
WHEREAS, pursuant to the Master Agreement, CNF Equipment desires to assign and
transfer to Enron Procurement all of CNF Equipment's interest in and to the
Partnership Property distributed and assigned to CNF Equipment under the
Distribution and Assignment Agreement (the "CNF Interest");
NOW THEREFORE, in consideration of the promises, covenants and agreements set
forth herein and in the Master Agreement and other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
acknowledge and ratify their agreement as follows:
Assignment. CNF Equipment hereby assigns, conveys, transfers and delivers to
Enron Procurement all of CNF Equipment's right title and interest in and to the
CNF Interest in exchange for the consideration specified in the Master
Agreement.
Acceptance of Assignment. Enron Procurement hereby accepts the assignment of the
CNF Interest and hereby assumes and agrees to perform or to satisfy and
discharge any and all duties and obligations relating to and arising out of the
Supply Contract.
Acknowledgment and Consent to Release of Partnership. Each Partner acknowledges,
consents to and agrees to be bound by, the terms and conditions set forth in the
attached Acknowledgment, Consent and Release.
Effective Date. This Agreement is effective as of the date first above written.
Further Assurances. The parties shall take all acts and execute all documents as
any other party may reasonably request to fully carry out and effectuate the
transactions contemplated by this Agreement.
Miscellaneous. This Agreement (including the Acknowledgment, Consent and Release
attached hereto): (i) shall be governed by and construed in accordance with the
laws of the State of Delaware; (ii) shall not be amended or modified except by
an instrument in writing executed by all parties; (iii) shall be binding upon
the successors and assigns of the respective parties; and (iv) may be executed
in several counterparts, all of which together shall constitute one agreement
binding on all parties hereto notwithstanding that all parties have not signed
the same counterpart.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
as of the date first above written.
CNF EQUIPMENT, INC.
a Delaware corporation, as assignor
By: ______________________________
Name:
Title:
ENRON EQUIPMENT PROCUREMENT COMPANY
a Delaware corporation, as assignee
By: ______________________________
Name:
Title:
ACKNOWLEDGMENT CONSENT AND RELEASE
THE UNDERSIGNED, EcoElectrica, L.P., hereby acknowledges and agrees that it has
been informed of and consents to the assignment and conveyance of the CNF
Interest pursuant to the terms and conditions of the Assignment and Assumption
Agreement (the "Agreement") to which this Acknowledgment, Consent and Release is
attached. Each capitalized term used herein and not otherwise defined herein
shall have the definition assigned thereto in the Agreement. EcoElectrica, L.P.
hereby further agrees that all references to "Supplier" and "Contractor" in that
certain Offshore Supply Contract dated as of November 1, 1995 (the "Supply
Contract"), originally between EcoElectrica, L.P. and Enron Procurement, shall
refer to Enron Procurement. Finally, EcoElectrica, L.P. hereby releases the
Partnership, and each of the Partners solely in their capacities as general
partners and limited partners in the Partnership (the "Released Parties"), from
all duties and obligations under the Supply Contract and agrees to accept
performance of all such duties and obligations from Enron Procurement in place
of the Partnership and the Released Parties.
ECOELECTRICA, L.P.,
a Bermuda exempted limited partnership
By: KES Bermuda, Inc.
a Delaware corporation, its general partner
By: ________________________
Name:
Title:
By: Buenergia, B.V.
a Dutch limited liability company, its general
partner
By: ________________________
Name:
Title:
OFFSHORE LETTER AGREEMENT
Exhibit 1.6(iv)
Enron Development Corp.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
[________________], 1997
Kenetech Energy Systems, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Cancellation of Side Letter Agreement
Gentlemen:
I refer to that certain Side Letter Agreement dated November 1, 1995 (the "Side
Letter Agreement") between Enron Development Corp. and Kenetech Energy Systems,
Inc., pursuant to which each has the right to cancel (i) the Onshore
Construction Contract dated as of November 1, 1995, originally between
EcoElectrica, L.P. and Enron Power Construction Partnership and (ii) the
Offshore Supply Contract dated as of November 1, 1995, originally between
EcoElectrica, L.P. and Enron Equipment Procurement Company ("Enron
Procurement").
In accordance with (i) the Master Agreement of Dissolution, Distribution and
Assignment dated the date hereof, by and between Enron Power I (Puerto Rico),
Inc. and CNF Penuelas, Inc., and (ii) the Master Agreement of Dissolution
Distribution and Assignment dated the date hereof, by and between Enron
Procurement, and CNF Equipment Inc., please evidence your agreement to cancel
the terms and conditions of the Side Letter Agreement by signing and returning
this letter agreement to the undersigned.
Very truly yours,
[Authorized Signatory]
AGREED AND ACCEPTED:
KENETECH ENERGY SYSTEMS, INC.
By: __________________________
Date: __________________________
Name:
Title:
OFFSHORE KENETECH GUARANTY
Exhibit 1.6(vi)
GUARANTY
This Guaranty, dated as of [________________], 1997 (this "Guaranty"), is by
Kenetech Corporation, a Delaware corporation (the "Guarantor"), in favor of
Enron Equipment Procurement Company, a Delaware corporation (the "Beneficiary"):
WHEREAS, the Beneficiary and CNF Equipment, Inc., a Delaware corporation and an
indirect wholly-owned subsidiary of the Guarantor ("CNF Equipment"), are the
sole general partners and limited partners of Enron/CNF Equipment, L.P., a
Delaware limited partnership (the "Partnership");
WHEREAS, the Beneficiary and CNF Equipment entered into that certain Master
Agreement of Dissolution, Distribution and Assignment, dated as of
[_____________], 1997, (the "Master Agreement"), whereby the parties agreed,
among other things, (i) to dissolve the Partnership and cause any and all right,
title and interest in and to the assets and property of the Partnership (the
"Partnership Property"), including, but not limited to, that certain Offshore
Supply Contract dated as of November 1, 1995 (the "Supply Contract"), originally
between EcoElectrica, L.P. and Enron Procurement, to be distributed to the
Beneficiary and CNF Equipment; (ii) that CNF Equipment assign and transfer to
the Beneficiary all of CNF Equipment's interests in and to the Partnership
Property to be distributed to CNF Equipment pursuant to the dissolution of the
Partnership (the "CNF Interest"); and (iii) that the Beneficiary thereafter
perform under the Supply Contract in lieu of the Partnership;
WHEREAS, it is a condition to the Beneficiary entering into the Master Agreement
that the Guarantor enter into this Guaranty;
WHEREAS, Guarantor acknowledges that it will benefit if CNF Equipment enters
into the Master Agreement;
NOW, THEREFORE, in consideration of the premises set forth above and other good
and valuable consideration, receipt of which is hereby acknowledged, and as an
inducement to the Beneficiary to enter into the Master Agreement, the Guarantor
hereby agrees as follows:
1. Guaranty. In consideration of the Beneficiary entering into the Master
Agreement, the Guarantor absolutely, unconditionally and irrevocably
guarantees to Beneficiary, its successors and assigns, the prompt payment
when due, of all obligations and liabilities of CNF Equipment to
Beneficiary arising from Section 3.1, Section 3.2, Section 3.4 and Section
5.1 of the Master Agreement (the "Obligations") for so long as any
Obligation may arise under the Master Agreement. If for any reason CNF
Equipment shall fail fully and punctually to pay and perform any
Obligation, the Guarantor shall pay such sum to the Beneficiary, plus
interest thereon calculated at the thirty day LIBOR rate from the date CNF
Equipment became obligated to make such payment under the Master Agreement
through the date payment is made by the Guarantor. This Guaranty is an
absolute, unconditional guaranty of payment and performance and not of
collectability, and is in no way conditioned or contingent upon any attempt
to collect from CNF Equipment, enforce performance by CNF Equipment or on
any other condition or contingency.
2. Nature of Guaranty. The Guarantor's obligations hereunder shall not be
affected by the validity or enforceability of CNF Equipment's obligations
under the Master Agreement or any other agreement relating thereto or by
any other event, occurrence or circumstance which might otherwise
constitute a legal or equitable discharge or defense of a guarantor or
surety. In the event that any payment of CNF Equipment in respect of any
Obligations is rescinded or must otherwise be returned for any reason
whatsoever, the Guarantor shall remain liable hereunder in respect to such
Obligations as if such payment had not been made. However, notwithstanding
anything herein to the contrary, nothing herein is intended to deny to the
Guarantor, and it is expressly agreed that the Guarantor shall have and may
assert, any and all of the defenses, set-offs, counterclaims and other
rights with regard to any Obligations that CNF Equipment may possess,
including without limitation, any defense based upon the payment or
satisfaction by CNF Equipment of such Obligations (or the performance or
observance of any terms or provisions of the Master Agreement out of which
such Obligations are alleged to arise), except any defense that CNF
Equipment may possess relating to (i) lack of validity or enforceability of
the Master Agreement against CNF Equipment arising from the defective
incorporation of CNF Equipment; (ii) lack of qualification by CNF Equipment
to do business in any applicable jurisdiction; (iii) defective corporate
authority by CNF Equipment to enter into or perform the Master Agreement;
or (iv) the insolvency, bankruptcy, or other reorganization of CNF
Equipment.
The Beneficiary shall not be obligated to file any claim relating to the
Obligations in the event that CNF Equipment becomes subject to a
bankruptcy, reorganization or similar proceeding, and the failure of
Beneficiary to file shall not affect the Guarantor's obligations hereunder.
3. Modification and Amendments. The Guarantor agrees that Beneficiary may at
any time and from time to time, without notice to or further consent of the
Guarantor, make any agreement with CNF Equipment or with any other party to
or person liable on any of the Obligations, or interested therein, for the
payment, compromise, discharge or release thereof, in whole or in part, or
for any modification of the terms thereof or of any agreement between
Beneficiary and CNF Equipment or any such other party or person, without in
any way impairing or affecting this Guaranty. Except the modifications
allowed pursuant to this Section 3, this Guaranty may be amended only with
the written consent of the Beneficiary and the Guarantor.
4. Expenses. The Guarantor agrees to pay on demand all out-of-pocket expenses
(including the reasonable fees and expenses of Beneficiary's counsel) in
any way relating to the enforcement or protection of the rights of
Beneficiary hereunder.
5. Subrogation. The Guarantor will not exercise any rights which it may
acquire by way of subrogation until all the Obligations to Beneficiary
shall have been paid in full. Subject to the foregoing, upon payment of all
the Obligations, the Guarantor shall be subrogated to the rights of
Beneficiary against CNF Equipment.
6. No Waiver; Cumulative Rights. No failure on the part of Beneficiary to
exercise, and no delay in exercising, any right, remedy or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
by Beneficiary of any right, remedy or power hereunder preclude any other
or future exercise of any right, remedy or power. Each and every right,
remedy and power hereby granted to Beneficiary or allowed it by law or
other agreement shall be cumulative and not exclusive of any other, and may
be exercised by Beneficiary from time to time.
7. Waiver of Notice. The Guarantor waives notice of the acceptance of this
Guaranty, presentment, demand, notice of dishonor, protest and all other
notices whatsoever.
8. Representations and Warranties.
(a) The Guarantor is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has full
corporate power to execute, deliver and perform this Guaranty.
(b) The execution, delivery and performance of this Guaranty have been and
remain duly authorized by all necessary corporate action and do not
contravene any provision of law or of the Guarantor's constitutional
documents or any contractual restriction binding on the Guarantor or
its assets.
(c) All consents, authorizations and approvals of, and registrations and
declarations with, any governmental authority necessary for the due
execution, delivery and performance of this Guaranty have been
obtained and remain in full force and effect and all conditions
thereof have been duly complied with, and no other action by, and no
notice to or filing with, any governmental authority is required in
connection with the execution, delivery or performance of this
Guaranty.
(d) This Guaranty constitutes the legal, valid and binding obligation of
the Guarantor enforceable against the Guarantor in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors rights and to general equity principles.
(e) (i) The Guarantor is not, and will not as a result of the execution
and delivery of this Guaranty, be rendered insolvent, (ii) the
Guarantor does not intend to incur, or believe it is incurring,
obligations beyond its ability to pay, and (iii) the Guarantor's
property remaining after the delivery and performance of this Guaranty
will not constitute unreasonably small capital.
9. Assignment. This Guaranty is binding upon Guarantor and its successors and
permitted assigns. Neither the Guarantor nor the Beneficiary may assign its
rights, interest or obligations hereunder to any other person without the
prior written consent of the other party.
10. Notices. All notices or other communications in connection with this
guaranty shall be given in the same manner and with the same effect as set
forth in Section 6.1 of the Master Agreement. The Guarantor's address for
notices is as follows:
Kenetech Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Telefax No. (▇▇▇) ▇▇▇-▇▇▇▇
or such other address as the Guarantor shall from time to time specify to
Beneficiary.
11. Governing Law. This Guaranty shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
choice of law doctrine.
12. Severability. The invalidity of one or more phrases, sentences, clauses or
Sections contained in this Guaranty shall not affect the validity of the
remaining portions of this Guaranty so long as the material purposes of
this Guaranty can be determined and effectuated.
IN WITNESS WHEREOF, the Guarantor has caused its duly authorized officer to
execute and deliver this Guaranty as of the date first above written.
KENETECH CORPORATION
By: ______________________________
Name:
Title:
OFFSHORE ENRON GUARANTY
Exhibit 1.6 (vii)
GUARANTY
This Guaranty, dated as of [_____________], 1997 (this "Guaranty"), is by Enron
Power Corp., a Delaware corporation (the "Guarantor"), in favor of CNF
Equipment, Inc., a Delaware corporation (the "Beneficiary"):
WHEREAS, the Beneficiary and Enron Equipment Procurement Company, a Delaware
corporation and an indirect [wholly-owned] subsidiary of the Guarantor ("Enron
Procurement"), are the sole general partners and limited partners of Enron/CNF
Equipment, L.P., a Delaware limited partnership (the "Partnership");
WHEREAS, the Beneficiary and Enron Procurement entered into that certain Master
Agreement of Dissolution, Distribution and Assignment, dated as of
[___________], 1997, (the "Master Agreement"), whereby the parties agreed, among
other things, (i) to dissolve the Partnership and cause any and all right, title
and interest in and to the assets and property of the Partnership (the
"Partnership Property"), including, but not limited to, that certain Offshore
Supply Contract dated as of November 1, 1995 (the "Supply Contract"), originally
between EcoElectrica, L.P. and Enron Procurement, to be distributed to the
Beneficiary and Enron Procurement; (ii) that the Beneficiary assign and transfer
to the Enron Procurement all of the Beneficiary's interests in and to the
Partnership Property to be distributed to the Beneficiary pursuant to the
dissolution of the Partnership (the "CNF Interest"); and (iii) that the Enron
Procurement thereafter perform under the Supply Contract in lieu of the
Partnership;
WHEREAS, it is a condition to the Beneficiary consummating the transactions
under the Master Agreement that the Guarantor enter into this Guaranty;
WHEREAS, Guarantor acknowledges that it will benefit if Enron Procurement
consummates the transactions under the Master Agreement;
NOW, THEREFORE, in consideration of the premises set forth above and other good
and valuable consideration, receipt of which is hereby acknowledged, and as an
inducement to the Beneficiary to enter into the Master Agreement, the Guarantor
hereby agrees as follows:
1. Guaranty. In consideration of the Beneficiary entering into the Master
Agreement, the Guarantor absolutely, unconditionally and irrevocably
guarantees to Beneficiary, its successors and assigns, the prompt payment
when due, of all obligations and liabilities of Enron Procurement to
Beneficiary arising from Section 3.1, Section 5.1 and Section 5.2 of the
Master Agreement (the "Obligations") for so long as any Obligation may
arise under the Master Agreement. If for any reason Enron Procurement shall
fail fully and punctually to pay and perform any Obligation, the Guarantor
shall pay such sum to the Beneficiary, plus interest thereon calculated at
the thirty day LIBOR rate from the date Enron Procurement became obligated
to make such payment under the Master Agreement through the date payment is
made by the Guarantor. This Guaranty is an absolute, unconditional guaranty
of payment and performance and not of collectability, and is in no way
conditioned or contingent upon any attempt to collect from Enron
Procurement, enforce performance by Enron Procurement or on any other
condition or contingency.
2. Nature of Guaranty. The Guarantor's obligations hereunder shall not be
affected by the validity or enforceability of Enron Procurement's
obligations under the Master Agreement or any other agreement relating
thereto or by any other event, occurrence or circumstance which might
otherwise constitute a legal or equitable discharge or defense of a
guarantor or surety. In the event that any payment of Enron Procurement in
respect of any Obligations is rescinded or must otherwise be returned for
any reason whatsoever, the Guarantor shall remain liable hereunder in
respect to such Obligations as if such payment had not been made. However,
notwithstanding anything herein to the contrary, nothing herein is intended
to deny to the Guarantor, and it is expressly agreed that the Guarantor
shall have and may assert, any and all of the defenses, set-offs,
counterclaims and other rights with regard to any Obligations that Enron
Procurement may possess, including without limitation, any defense based
upon the payment or satisfaction by Enron Procurement of such Obligations
(or the performance or observance of any terms or provisions of the Master
Agreement out of which such Obligations are alleged to arise), except any
defense that Enron Procurement may possess relating to (i) lack of validity
or enforceability of the Master Agreement against Enron Procurement arising
from the defective incorporation of Enron Procurement; (ii) lack of
qualification by Enron Procurement to do business in any applicable
jurisdiction; (iii) defective corporate authority by Enron Procurement to
enter into or perform the Master Agreement; or (iv) the insolvency,
bankruptcy, or other reorganization of Enron Procurement.
The Beneficiary shall not be obligated to file any claim relating to the
Obligations in the event that Enron Procurement becomes subject to a
bankruptcy, reorganization or similar proceeding, and the failure of
Beneficiary to file shall not affect the Guarantor's obligations hereunder.
3. Modification and Amendments. The Guarantor agrees that Beneficiary may at
any time and from time to time, without notice to or further consent of the
Guarantor, make any agreement with Enron Procurement or with any other
party to or person liable on any of the Obligations, or interested therein,
for the payment, compromise, discharge or release thereof, in whole or in
part, or for any modification of the terms thereof or of any agreement
between Beneficiary and Enron Procurement or any such other party or
person, without in any way impairing or affecting this Guaranty. Except the
modifications allowed pursuant to this Section 3, this Guaranty may be
amended only with the written consent of the Beneficiary and the Guarantor.
4. Expenses. The Guarantor agrees to pay on demand all out-of-pocket expenses
(including the reasonable fees and expenses of Beneficiary's counsel) in
any way relating to the enforcement or protection of the rights of
Beneficiary hereunder.
5. Subrogation. The Guarantor will not exercise any rights which it may
acquire by way of subrogation until all the Obligations to Beneficiary
shall have been paid in full. Subject to the foregoing, upon payment of all
the Obligations, the Guarantor shall be subrogated to the rights of
Beneficiary against Enron Procurement.
6. No Waiver; Cumulative Rights. No failure on the part of Beneficiary to
exercise, and no delay in exercising, any right, remedy or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
by Beneficiary of any right, remedy or power hereunder preclude any other
or future exercise of any right, remedy or power. Each and every right,
remedy and power hereby granted to Beneficiary or allowed it by law or
other agreement shall be cumulative and not exclusive of any other, and may
be exercised by Beneficiary from time to time.
7. Waiver of Notice. The Guarantor waives notice of the acceptance of this
Guaranty, presentment, demand, notice of dishonor, protest and all other
notices whatsoever.
8. Representations and Warranties.
(a) The Guarantor is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has full
corporate power to execute, deliver and perform this Guaranty.
(b) The execution, delivery and performance of this Guaranty have been and
remain duly authorized by all necessary corporate action and do not
contravene any provision of law or of the Guarantor's constitutional
documents or any contractual restriction binding on the Guarantor or
its assets.
(c) All consents, authorizations and approvals of, and registrations and
declarations with, any governmental authority necessary for the due
execution, delivery and performance of this Guaranty have been
obtained and remain in full force and effect and all conditions
thereof have been duly complied with, and no other action by, and no
notice to or filing with, any governmental authority is required in
connection with the execution, delivery or performance of this
Guaranty.
(d) This Guaranty constitutes the legal, valid and binding obligation of
the Guarantor enforceable against the Guarantor in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors rights and to general equity principles.
(e) (i) The Guarantor is not, and will not as a result of the execution
and delivery of this Guaranty, be rendered insolvent, (ii) the
Guarantor does not intend to incur, or believe it is incurring,
obligations beyond its ability to pay, and (iii) the Guarantor's
property remaining after the delivery and performance of this Guaranty
will not constitute unreasonably small capital.
9. Assignment. This Guaranty is binding upon Guarantor and its successors and
permitted assigns. Neither the Guarantor nor the Beneficiary may assign its
rights, interest or obligations hereunder to any other person without the
prior written consent of the other party.
10. Notices. All notices or other communications in connection with this
guaranty shall be given in the same manner and with the same effect as set
forth in Section 6.1 of the Master Agreement. The Guarantor's address for
notices is as follows:
Enron Power Corp.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Legal Department
Telefax No.
or such other address as the Guarantor shall from time to time specify to
Beneficiary.
11. Governing Law. This Guaranty shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
choice of law doctrine.
12. Severability. The invalidity of one or more phrases, sentences, clauses or
Sections contained in this Guaranty shall not affect the validity of the
remaining portions of this Guaranty so long as the material purposes of
this Guaranty can be determined and effectuated.
IN WITNESS WHEREOF, the Guarantor has caused its duly authorized officer to
execute and deliver this Guaranty as of the date first above written.
ENRON POWER CORP.
By: ________________________________
Name:
Title:
OFFSHORE RELEASE OF CNF
Exhibit 1.6(x)
CNF Industries, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[_______], 1997
Enron Equipment Procurement Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Legal Department
Re: Release of CNF Industries, Inc. Guaranty
Gentlemen:
I refer to that certain Guaranty dated as of December 18, 1996 (the "CNF
Offshore Guaranty") by CNF Industries, Inc., a Delaware corporation (the
"Guarantor"), for the benefit of Enron Equipment Procurement Company, a Delaware
corporation ("Enron Procurement"), entered into pursuant to Section 11.3 of the
Limited Partnership Agreement of Enron/CNF Equipment, L.P., a Delaware limited
partnership.
In accordance with (i) the Master Agreement of Dissolution, Distribution and
Assignment dated [________], 1997, by and between Enron Procurement and CNF
Equipment, Inc., and (ii) Section 16 of the CNF Offshore Guaranty, please
evidence your agreement to terminate the CNF Offshore Guaranty and release the
Guarantor from any and all obligations thereunder by signing and returning this
letter agreement to the undersigned.
Very truly yours,
[Authorized Signatory]
AGREED AND ACCEPTED:
ENRON EQUIPMENT PROCUREMENT COMPANY
By: __________________________ Date: July __, 1997
Name:
Title:
OFFSHORE RELEASE OF ENRON
Exhibit 1.6(xi)
Enron Power Corp.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
[_______], 1997
CNF Equipment, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:__________________
Re: Release of Enron Power Corp. Guaranty
Gentlemen:
I refer to that certain Guaranty dated as of December 18, 1996 (the "EPC
Offshore Guaranty") by Enron Power Corp., a Delaware corporation (the
"Guarantor"), for the benefit of CNF Equipment, Inc., a Delaware corporation
("CNF Equipment"), entered into pursuant to Section 11.3 of the Limited
Partnership Agreement of Enron/CNF Equipment, L.P., a Delaware limited
partnership.
In accordance with (i) the Master Agreement of Dissolution, Distribution and
Assignment dated [______], 1997, by and between Enron Equipment Procurement
Company and CNF Equipment, and (ii) Section 16 of the EPC Offshore Guaranty,
please evidence your agreement to terminate the EPC Offshore Guaranty and
release the Guarantor from any and all obligations thereunder by signing and
returning this letter agreement to the undersigned.
Very truly yours,
[Authorized Signatory]
AGREED AND ACCEPTED:
CNF EQUIPMENT, INC.
By: __________________________ Date: July __, 1997
Name:
Title: