EXHIBIT 10.51
GUARANTEE ASSUMPTION AGREEMENT
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dated as of December 23, 1998
This unconditional assumption agreement relates to that certain Guaranty
dated November 25, 1997, a copy of which is attached hereto (the "▇▇▇▇
GUARANTY").
For Value Received, and in compliance with its obligations as "Transferee"
as defined in Section 8.1 of the Shareholders Agreement dated as of December 8,
1997, by and among EcoElectrica Holdings, Ltd., and the shareholders thereof,
the undersigned Edison Mission Energy ("SUCCESSOR") hereby agrees as follows:
1. ASSUMPTION. Successor unconditionally and irrevocably assumes and
agrees to perform all obligations of KENETECH Energy Systems, Inc. under the
▇▇▇▇ Guaranty, to the same extent and in the same manner as is required of
"Guarantor" under such ▇▇▇▇ Guaranty.
2. NET WORTH COVENANT. On the date hereof and, in addition, within 120
days of the end of each calendar year during the term of the ▇▇▇▇ Guaranty,
Successor will deliver an officer's certificate certifying that its net worth is
at least the "Minimum Amount" (as defined below) or, if less, the amount of such
net worth. At any time that the net worth of Successor falls below the Minimum
Amount, Edison International shall cause another wholly owned subsidiary of
Edison International with a net worth of over the Minimum Amount to execute a
counterpart of this Guaranty Assumption Agreement as Successor; provided,
however, that such execution shall not release Successor from any pending claims
under the ▇▇▇▇ Guaranty. The "Minimum Amount" shall be, at Successor's option,
$200,000,000, or $100,000,000 exclusive of the value of the interest in
EcoElectrica owned by Successor and its Affiliates.
3. INDEMNITY. Successor agrees to indemnify and hold harmless KENETECH
Energy Systems, Inc. and its successors and assigns for any liability under the
▇▇▇▇ Guaranty.
4. REPRESENTATIVES AND WARRANTIES. Successor represents and warrants that
as of the date of this Guaranty, it is a duly organized, validly existing,
corporation organized and in good standing under the laws of the State of
California, has all requisite power and authority to conduct its business and to
own its property as now conducted or owned, and is qualified
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to do business in all jurisdictions where the nature and extent of its business
is such that such qualification is required by law.
5. PARTIES BOUND. This Agreement shall be binding upon Successor and
Successor's respective successors and assigns and shall be for the benefit of
▇▇▇▇, Enron Power Corp. and EcoElectrica, ▇.▇.
▇▇▇▇▇▇ MISSION ENERGY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Its Vice President
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GUARANTY
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This unconditional guaranty ("Guaranty") is given pursuant to the terms and
conditions a certain Option to Purchase Agreement dated September 24, 1996, (the
"Option Agreement") by and between Union Carbide Caribe Inc. having an address
at Tallaboa ▇▇▇▇ -- Firm Delivery, Penuelas, Puerto Rico 00624 ("▇▇▇▇") and
EcoElectrica, L.P., having an address at Plaza Scotiabank, 273 ▇▇▇▇▇ de ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("EcoElectrica"). Capitalized
terms used herein and not otherwise specifically defined shall have the same
meaning herein as in the Option Agreement.
FOR VALUE RECEIVED, and to induce ▇▇▇▇ to enter into the Option Agreement,
KENETECH Energy Systems, Inc., a Delaware corporation having offices at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and Enron Power Corp., a Delaware
corporation having offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, hereinafter
called jointly, severally and collectively "Guarantor," hereby unconditionally
agree as follows:
1. Guaranty. Guarantor, as a primary party and not merely as a surety,
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unconditionally, irrevocably and for the term of this Guaranty (as specified in
Section 2, below) guarantees the prompt and full payment (and not merely the
collectibility), performance, and observance of the obligations incurred by
EcoElectrica pursuant to Sections 5(a) and 6 of the Option Agreement, but (i)
only such obligations as arise from events or circumstances that occur prior to
the "Commercial Operations Commencement Date" defined below and (ii) in no
event will Guarantor be subject to consequential, exemplary, equitable, loss of
profits, tort or any other damages costs or attorney's fees.
Upon any failure of EcoElectrica to meet its obligations under Sections
5(a) and 6 of the Option Agreement, and during the term of this Guaranty, ▇▇▇▇
may at its option proceed directly and at once, without further notice, against
Guarantor, without proceeding against EcoElectrica. Any sums payable by
Guarantor hereunder shall bear interest at the statutory rate for judgments in
Puerto Rico from the date of ▇▇▇▇'▇ demand until the date paid.
2. Term of Guaranty. Guarantor's obligations hereunder shall commence on the
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date hereof and terminate on the fifth anniversary of commencement of commercial
operation of the Facilities, which shall be the date (the "Commercial Operations
Commencement Date") on which ▇▇▇▇ is delivered a certificate (the "Commercial
Operations Certificate") executed by EcoElectrica and the independent engineer
of EcoElectrica's lenders certifying that the "Commercial Operation Date" (as
defined in EcoElectrica's Power
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Sale Agreement entered into with the Puerto Rico Electric Power Authority) has
occurred, which certification is a condition precedent to conversion of
EcoElectrica's construction loan to a term loan.
Within 120 days of the end of each calendar year during the term of this
Guaranty, Enron Power Corp. will deliver an officer's certificate certifying
that its net worth is at least two hundred million dollars ($200,000,000) or, if
less, the amount of such net worth. At any time that the net worth of Enron
Power Corp. falls below two hundred million dollars ($200,000,000), EcoElectrica
shall substitute for this Guaranty a guaranty having the same form and substance
issued by another Enron Corp. subsidiary with a net worth of two hundred million
dollars ($200,000,000) or more; provided, however, that such substitution shall
not release Enron Power Corp. from any pending claims under this Guaranty.
3. Waiver. Guarantor hereby waives and relinquishes to the fullest extent now
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or hereafter not prohibited by applicable law:
(i) all suretyship defenses and defenses in the nature thereof; and
(ii) all rights and remedies against ▇▇▇▇, its parent any their
respective subsidiaries and affiliates, and their respective parent corporations
(including, but not limited to, any rights of subrogation, contribution,
reimbursement, exoneration or indemnification pursuant to any agreement),
express or implied, that are now or hereafter accorded by applicable law to
parties in the capacity of indemnitors, guarantors, sureties or accommodation
parties.
4. Cumulative Rights. ▇▇▇▇'▇ rights under this Agreement shall be in addition
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to and not in limitation of all of the rights and remedies of the Option
Agreement. All rights and remedies of ▇▇▇▇ shall be cumulative and may be
exercised in such manner and combination as ▇▇▇▇ may determine.
5. Representaions and Warranties. Each of KENETECH Energy Systems, Inc. and
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Enron Power Corp. individually and respectively represents and warrants to ▇▇▇▇
for the express purpose of inducing ▇▇▇▇ to enter into the Option Agreement and
to accept this Guaranty, that as of the date of this guaranty, each is a duly
organized, validly existing corporation organized and in good standing under the
laws of Delaware, has all requisite power and authority to conduct its business
and to own its property as now conducted or owned, and is qualified to do
business in all jurisdictions where the nature and extent of its business is
such that such qualification is required by law.
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6. Notices. Any notice or other communication in connection with this Guaranty
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shall be in writing and (i) deposited in the United States mail, postage prepaid
by registered or certified mail, or (ii) hand delivered by any commercially
recognized courier service or overnight delivery service such as Federal Express
addressed as follows:
If to Guarantor:
KENETECH Energy Systems, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Enron Power Corp.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
If to ▇▇▇▇:
Union Carbide Caribe Inc.
Tallaboa ▇▇▇▇ - Firm Delivery
Penuelas, Puerto Rico 00624
Attention: President
and
Union Carbide Corporation
▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Manager, Real Estate Department
and
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Toro, Esq.
7. Parties Bound. This Agreement shall be binding upon Guarantor and
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Guarantor's respective successors and permitted assigns and shall be for the
benefit of ▇▇▇▇.
8. Joint and Several. The obligations of each Guarantor and such Guarantor's
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respective successors, assigns, heirs and personal representatives shall be and
remain joint and several. Each reference to Guarantor shall include each
Guarantor separately as well as both Guarantors collectively.
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9. Governing Law. This Agreement shall be governed and interpreted under the
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law of the State of New York, without reference to conflicts of law principles.
Witness the execution and delivery hereof as of this 25/th/ day of November,
1997.
KENETECH Energy Systems, Inc.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Enron Power Corp.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President Development Engineering