STOCK PURCHASE
AND ASSIGNMENT
AGREEMENT
By and
Among
KES PUERTO RICO, L.P.,
and
KENETECH ENERGY SYSTEMS, INC.
and
KES BERMUDA, INC.
and
EME DEL CARIBE
and
EDISON MISSION ENERGY
dated as
of
December 23, 1998
TABLE OF CONTENTS
Page
2. SALE AND PURCHASE. 2
3. CLOSING. 2
3.1. Time and Place. 2
3.2. Transactions at Closing. 2
4. REPRESENTATIONS AND WARRANTIES OF THE KES ENTITIES. 4
4.1. Organization; Authority. 4
4.2. Approval; Binding Effect. 5
4.3. Non-Contravention. 5
4.4. Governmental Consents. 5
4.5. Proceedings. 6
4.6. Financial Statements. 6
4.7. Shareholders Agreement. 6
4.8. Brokers. 6
4.9. Bankruptcy. 6
4.10. Investment Company Act. 7
4.11. Capitalization. 7
4.12. Special Purpose Entities. 8
4.13. Title to the Interest, Liens, etc. 8
4.14. All Required KPR Capital Contributions
Made Under Shareholders Agreement. 8
4.15. The Project. 8
4.16. Limitations on Representations and Warranties. 10
5. REPRESENTATIONS AND WARRANTIES OF BUYER. 11
5.1. Organization; Authority. 11
5.2. Corporate Approval; Binding Effect. 11
5.3. Non-Contravention 12
5.4. Governmental Consents. 12
5.5. Brokers. 12
5.6. No Financing. 12
5.7. Investment Company Act. 12
5.8. Due Diligence Review. 12
5.9. No Registration; Investment Representation;
Accredited Investor; Sophisticated Person. 13
5.10. Employee Benefits Plan. 13
5.11. Status as an "Electric Utility". 14
5.12. Compliance with Confidentiality Agreement. 14
6. INTENTIONALLY OMITTED. 14
7. CONDITIONS PRECEDENT TO BUYER PARTIES' OBLIGATIONS. 14
7.1. Representations and Warranties True at Closing. 14
7.2. Compliance With Agreement. 14
7.3. Officer's Certificate. 14
7.4. Resolution of the QF Issue. 14
7.5. Consents. 14
7.6. Suits and Proceedings. 14
7.7. No Material Adverse Change. 15
7.8. Resignations of Directors and Officers. 15
7.9. Releases. 15
7.10. Affidavit. 15
7.11. Fieldstone Fairness Opinion. 15
7.12. KPMG Comfort Letter. 15
7.13. Notices Under the Credit Agreement. 16
7.14. Opinion of Counsel. 16
7.15. Certificate, Documents. 16
8. CONDITIONS PRECEDENT TO KES ENTITY OBLIGATIONS. 16
8.1. Representations and Warranties True at Closing. 16
8.2. Compliance with Agreement. 16
8.3. Officer's Certificate. 17
8.4. Opinion of Counsel. 17
8.5. Assumption of Certain Obligations. 17
8.6. Certificates, Documents. 17
9. CONFIDENTIAL INFORMATION. 17
10. HSR ACT. 17
11. POST CLOSING TAX INCENTIVE. 17
12. RELEASE. 18
13. GENERAL. 18
13.1. Expenses. 18
13.2. Notices. 18
13.3. Entire Agreement. 20
13.4. Governing Law; CONSENT TO JURISDICTION. 20
13.5. Sections and Section Headings. 20
13.6. Assigns. 20
13.7. Further Assurances. 21
13.8. No Implied Rights or Remedies. 21
13.9. Knowledge. 21
13.10. Counterparts. 21
13.11. Satisfaction of Conditions Precedent. 21
13.12. Time is of the Essence and Best Efforts. 21
13.13. Survival of Representations and Warranties. 21
Schedules
4.5 Proceedings
4.6 Material Liabilities
7.5 Required Consents
7.9 Resignations of Directors and Officers
Exhibits
A Assignment and Assumption Agreement
B Confidentiality Agreement
C PREPA Waiver Agreement
2. STOCK PURCHASE AND ASSIGNMENT AGREEMENT
THIS STOCK PURCHASE AND ASSIGNMENT AGREEMENT (this "Agreement") is dated as of
the 23rd day of December, 1998, by and between (i) EME del Caribe, a Cayman
Islands company limited by shares ("Buyer") and Edison Mission Energy, a
California corporation ("Assignee," collectively with the Buyer, the "Buyer
Parties") and (ii) KES Puerto Rico, L.P., a Bermuda exempted limited partnership
("KPR"), KENETECH Energy Systems, Inc., a Delaware corporation ("KES") and KES
Bermuda, Inc., a Delaware corporation ("KBI", collectively with KPR and KES, the
"KES Entities").
WHEREAS, KPR owns a fifty percent (50%) interest in EcoElectrica Holdings, Ltd.,
a Cayman Islands company limited by shares (the "Company"), in the form of the
issued and outstanding Class B Shares (as defined in Section 4.11 hereof) of the
Company (the "Interest");
WHEREAS, the Company directly owns a one hundred percent (100%) interest in
EcoElectrica, Ltd., a Cayman Islands company limited by shares (the "General
Partner"), and owns a ninety-nine percent (99%) interest in EcoElectrica, L.P.,
a Bermuda exempted limited partnership (the "Project Partnership"), which was
formed to develop, design, finance, construct, own and operate an approximately
540 megawatt (net) natural gas-fired cogeneration facility, liquefied natural
gas import terminal, a desalination facility and certain other auxiliary and
related assets (collectively, the "Project"); the General Partner owns a one
percent (1%) interest in the Project Partnership;
WHEREAS, in order to set forth an understanding regarding certain elements of
the relationships involving the Company, the Project Partnership and the General
Partner, KPR entered into that certain Shareholders Agreement, dated as of
December 10, 1997, by and among KPR, the Company and Buenergia Gas & Power,
Ltd., a Cayman Islands company limited by shares (the "Shareholders Agreement");
WHEREAS, KBI has entered into an Administrative Services Agreement with the
Project Partnership, dated as of October 31, 1997 (the "Administrative Services
Agreement"), pursuant to which KBI receives a fee, plus expense reimbursement
for providing advisory services to the Project Partnership;
WHEREAS, KES has received a note issued by the Project Partnership payable to
KES in the original principal amount of $22,064,185 for unpaid development fees
(the "Project Note");
WHEREAS, KPR desires to sell the Interest to Buyer, KES desires to assign all of
its rights and other interests in the Project Note to Assignee, and KBI desires
to assign all of its rights and other interests in the Administrative Services
Agreement to Buyer, and Buyer desires to purchase the Interest of KPR in the
Company and to take in assignment the Administrative Services Agreement from
KBI, and Assignee desires to take in assignment the Project Note from KES, each
upon the terms and subject to the conditions contained in this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and agreements set forth
herein, the Buyer Parties and the KES Entities agree as follows:
(1) DEFINITIONS.
Capitalized terms used herein without definition, which are defined in or
by reference in the Shareholders Agreement, shall have the same meanings
herein as therein.
(2) SALE AND PURCHASE.
Subject to the terms and conditions set forth in this Agreement: (a) KPR
agrees to sell to Buyer, and Buyer agrees to purchase from KPR, the
Interest; (b) KES agrees to assign to Assignee, and Assignee agrees to take
in assignment from KES, all of KES's rights and other interests in the
Project Note; and (c) KBI agrees to assign to Buyer, and Buyer agrees to
take in assignment from KBI, all of KBI's rights and other interests in the
Administrative Services Agreement. In exchange for these items, the Buyer
Parties shall tender payment of an aggregate cash purchase price equal to
$213,500,000, which payment shall be applied in accordance with Section
3.2(c) plus the payment, if any, to be made pursuant to Section 11 (such
payments collectively, the "Purchase Price").
3. CLOSING.
3.1 Time and Place. The closing of the sale and purchase of the Interest
and the assignment of the Project Note and the Administrative Services
Agreement (the "Closing") shall be held at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇
LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ at 10:00 a.m. on
December 23, 1998, or at such other time, or at such other place as
the Buyer Parties and the KES Entities may agree. The date on which
the Closing is actually held hereunder is sometimes referred to herein
as the "Closing Date".
3.2 Transactions at Closing.
At the Closing:
(a) KPR shall deliver to Buyer, free and clear of any lien, claim or
encumbrance, a certificate representing all of the Interest, duly
endorsed in blank or with duly executed stock powers attached,
and Buyer shall undertake certain duties and obligations under
the Shareholder's Agreement pursuant to an Assignment and
Assumption Agreement in the form of Exhibit A-1 hereto. KBI shall
assign to Buyer, free and clear of any lien, claim or
encumbrance, the Administrative Services Agreement pursuant to an
Assignment and Assumption Agreement in the form of Exhibit A-2
hereto. KES shall assign to Assignee, free and clear of any lien,
claim or encumbrance, the Project Note pursuant to an Assignment
and Assumption Agreement in the form of Exhibit A-3 hereto
(collectively, the "Assignment and Assumption Agreements").
(b) The Buyer Parties shall execute and deliver to the KES Entities
the following documents: (i) an Equity Support Guarantee in the
form attached as Exhibit E-2-B to the Depositary Agreement (as
defined in the Credit Agreement), providing a $33.5 million
equity funding guarantee; (ii) a Master Guarantee and Support
Instrument in the form attached as Exhibit D-1 to the Depositary
Agreement; (iii) a Guarantee Assumption Agreement in the form
attached as Exhibit C to the Shareholders Agreement; (iv) a
Consent and Assignment in the form of that which was delivered by
KBI on October 31, 1997, mutatis mutandis, pursuant to the Credit
Agreement; and (v) the Assignment and Assumption Agreements in
the forms of Exhibit ▇-▇, ▇-▇, and A-3.
(c) The Buyer Parties shall deliver the Purchase Price by wire
transfer of immediately available funds:
(i) to Fleet National Bank, Hartford, CT to ABA #▇▇▇-▇▇▇-▇▇▇,
for the account of Lyon Credit Corporation at Account No.
007030-0226 in the amount of $27,351,564.53;
(ii) to Sanwa Bank California, Los Angeles, CA to ABA #▇▇▇▇▇▇▇▇▇,
for the account of KENETECH Windpower Inc. Debtor in
Possession, Account No. 0665-28604, in the amount of
$6,500,000;
(iii)to Bank of New York, New York, NY to ABA #0210 00018, as
Indenture Trustee for GLA #111-565, for further credit to
Account No. 308335, for A/C Risk - KENETECH (the account of
the Indenture Trustee), in the amount of $145,346,695.50;
(iv) to Bank of New York, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ to ABA
#▇▇▇▇▇▇▇▇▇, for the account of Fieldstone Private Capital
Group, L.P. at Account Name: FPCG Services, L.P., Account
No.: 8900148829, in the amount of $2,000,000;
(v) to Sanwa Bank California, San Francisco, CA to ABA
#▇▇▇▇▇▇▇▇▇, for the account of KENETECH Energy Systems,
Inc., Payroll Account, Account No. 0662-26054 in the amount
of $8,000,000; and
(vi) the balance of the Purchase Price (not including any amount
payable under Section 11) to Bank of New York, New York, NY
to ABA #▇▇▇▇▇▇▇▇▇, Account No. 8900 11 8245, for the account
of Fidelity Group of Funds Institutional Account, for
further credit to KENETECH Energy Systems, Inc., Account No.
0059-00080389620 in the amount of $24,301,740.00.
(vii)The Buyer Parties shall make the payment to PREPA under the
Waiver Agreement (each as defined in Section 7.4), to
Citibank, NY, New York, NY to ABA #▇▇▇▇▇▇▇▇▇, for Citibank,
PR as Receiving Bank, Account No. 10-99-1506, for further
credit to PREPA Citi-Cogen Funds, Account No. ▇-▇▇▇▇▇▇-▇▇▇,
in the amount of $29,275,000;
4. REPRESENTATIONS AND WARRANTIES OF THE KES ENTITIES.
The KES Entities represent and warrant to the Buyer Parties as follows:
4.1 Organization; Authority. Each of KES and KBI is a corporation duly
organized, validly existing and in good standing in the State of
Delaware. KPR is a Bermuda exempted limited partnership under the
Bermuda Exempted Limited Partnership Act, 1992 and the Bermuda Limited
Partnership Act, 1883, duly established, validly existing and in good
standing in Bermuda. Each of the Company and the General Partner is a
Cayman Islands company limited by shares, duly organized, validly
existing and in good standing in the Cayman Islands. The Project
Partnership is a limited partnership under the Bermuda Exempted
Limited Partnership Act, 1992 and the Bermuda Limited Partnership Act,
1883, duly established, validly existing and in good standing in
Bermuda. Each of the KES Entities has delivered to the Buyer Parties
complete and correct copies of its limited partnership or corporate
charter documents and by-laws or other organizational documents, and
all amendments thereto, as applicable. KPR has delivered to Buyer
complete and correct copies of the limited partnership or corporate
charter documents and by-laws or other organizational documents and
all amendments thereto, as applicable, for the Company, the General
Partner and the Project Partnership. Each of KPR, KES and KBI has all
requisite power and authority under its limited partnership or
corporate charter documents and bylaws or other organizational
documents, as applicable, and all amendments thereto, and under
applicable laws to execute and deliver this Agreement and to
consummate the transactions contemplated hereby, and to perform all
its agreements and obligations under this Agreement in accordance with
its terms, and to sell the Interest and assign the Administrative
Services Agreement to the Buyer and the Project Note to Assignee.
4.2 Approval; Binding Effect. The KES Entities have given all necessary
notices and obtained all necessary authorizations and approvals of any
Person, other than a Governmental Person, required for the execution
and delivery of this Agreement and the consummation of the
transactions contemplated hereby. This Agreement has been duly
executed and delivered by each of the KES Entities and constitutes the
legal, valid and binding obligation of each of the KES Entities,
enforceable against each of the KES Entities in accordance with its
terms, except to the extent such enforceability is subject to the
effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or other law affecting or relating to creditors' rights
generally and general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
4.3 Non-Contravention. Neither the execution and delivery of this
Agreement by any KES Entity nor the consummation by any KES Entity of
the transactions contemplated hereby will constitute a violation of,
or be in conflict with, or constitute or create a default under, or
result in the creation or imposition of any lien, claim or encumbrance
upon any property of any KES Entity, KENETECH Corporation ("KES's
Parent"), the Company, the General Partner or the Project Partnership,
which either individually or in the aggregate could reasonably be
expected to have a material adverse effect on the business, operations
or financial condition of the Company, the General Partner, the
Project Partnership or any of the KES Entities taken as a whole (a
"Material Adverse Effect") pursuant to: (a) the charter documents or
by-laws or other organizational documents of KES's Parent, the
Company, the General Partner, the Project Partnership or any of the
KES Entities, each as amended to date; (b) any material agreement or
commitment to which KES's Parent, the Company, the General Partner,
the Project Partnership or any of the KES Entities is a party; (c) the
Settlement Agreement and any other agreement to which KES is or may be
a party with its creditors; or (d) any statute or any judgment,
decree, order, regulation or rule of any court or other Governmental
Person.
4.4 Governmental Consents. No consent, approval or authorization of, or
registration, qualification or filing with, any Governmental Person is
required for the execution and delivery of this Agreement by the KES
Entities or for the consummation by the KES Entities of the
transactions contemplated hereby, other than those already obtained on
or prior to Closing.
4.5 Proceedings. Except as disclosed in Schedule 4.5, to the actual
knowledge of its officers, the KES Entities know of no material
actions, suits, proceedings or investigations pending or threatened
against or affecting any KES Entity, the Company, the General Partner
or the Project Partnership, in, by or before any court, agency,
commission, arbitrator, board, authority or other tribunal.
4.6 Financial Statements. Each unaudited balance sheet dated December 31,
1997, March 31, 1998, June 30, 1998 and September 30, 1998, and
statement of income for the quarter then ended, delivered to Buyer
with respect to each KES Entity, the Company, the General Partner and
the Project Partnership ("Financial Statements") has been prepared in
accordance with generally accepted accounting principles, consistently
applied, and fairly and accurately presents the financial condition
and results of operations of each such entity as at the date and for
the period shown therein, subject to normal year-end adjustments made
to conform such statements to generally accepted accounting
principles. Except as (a) reflected in such Financial Statements or,
(b) disclosed in Schedule 4.6 and which will be released at Closing,
none of the KES Entities, the Company, the General Partner or the
Project Partnership has any material liabilities or obligations, which
are required to be disclosed in a balance sheet prepared in accordance
with generally accepted accounting principles. Since the date of such
Financial Statements, each of the KES Entities, the Company, the
General Partner and the Project Partnership has conducted its business
in the ordinary course of its business consistent with past practice,
and has not entered into any material agreement, commitment or
transaction except in the ordinary course of its business or increased
its indebtedness (other than by means of preexisting credit
facilities) or other material liabilities.
4.7 Shareholders Agreement. Prior to the date hereof, KPR has delivered to
the Buyer Parties, true, correct and complete copies of the Company's
charter documents and the Shareholders Agreement, each of which is in
full force and effect and has not been amended, modified or
supplemented.
4.8 Brokers. Except for Fieldstone Private Capital Group, L.P., which has
been retained by KES, no KES Entity has retained, utilized or been
represented by any broker or finder in connection with the
transactions contemplated by this Agreement. KES shall be responsible
for the payment of all commissions, fees and expenses of Fieldstone
Private Capital Group, L.P., other than those payable by the Buyer in
connection with the Opinion mentioned in Section 7.11.
4.9 Bankruptcy. Neither KES's Parent, the Company, the General Partner,
the Project Partnership nor any KES Entity has filed any voluntary
petition in bankruptcy or been adjudicated as bankrupt or insolvent,
filed any petition or answer seeking any reorganization, liquidation,
dissolution or similar relief under any federal bankruptcy,
insolvency, or other debtor relief law, or sought or consented to or
acquiesced in the appointment of any trustee, receiver, conservator or
liquidator of all or any substantial part of its properties. No court
of competent jurisdiction has entered an order, judgment or decree
approving a petition filed against KES's Parent or any KES Entity
seeking any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any bankruptcy act,
or other debtor relief law, and no other liquidator, receiver or
trustee has been appointed for KES's Parent, the Company, the General
Partner, the Project Partnership or any KES Entity, or for all or any
substantial part of their properties, nor has any involuntary petition
been filed with respect to any such entity. The Settlement Agreement
and Release dated as of May 13, 1998, among KES, KENETECH Windpower,
Inc. ("KWI"), the Official Unsecured Creditors' Committee of KWI, and
certain other parties named therein (the "Settlement Agreement") is in
full force and effect and no breach or default has occurred thereunder
or will occur thereunder as a result of the transactions contemplated
to occur pursuant to this Agreement at Closing.
4.10 Investment Company Act. None of the KES Entities, the Company, the
General Partner or the Project Partnership is an "investment company"
or a company "controlled" by an investment company, within the meaning
of the Investment Company Act of 1940, as amended.
4.11 Capitalization.
(a) The Company. The initial authorized capital of the Company
consists of 500,000,000 Class A ordinary limited liability shares
(the "Class A Shares") and 500,000,000 Class B ordinary limited
liability shares (the "Class B Shares"), each with a par value of
US$0.01. On the Closing Date, 100 Class A Shares and 100 Class B
Shares are issued and outstanding. All the Class B Shares are
validly issued and outstanding, fully paid and nonassessable, are
not subject to any transfer restrictions, except as set forth in
the Shareholders Agreement and in applicable securities laws, and
are owned of record and beneficially by KPR, free and clear of
any claims, liens, or encumbrances, except as provided in the
Shareholders Agreement. The Company does not have outstanding
rights (preemptive or other) to subscribe for or to purchase, or
any warrants for the purchase of, or any agreements,
understandings or arrangements providing for or other obligations
requiring the issuance (contingent or other) of, or any calls,
options, commitments or claims of any character relating to, any
shares of any class of its capital stock or any securities
convertible or exchangeable for any such stock. The Company is
not subject to any obligations (contingent or other) to
repurchase or otherwise acquire or rescind the sale of any shares
of any class of its stock or any securities, rights or options
related thereto.
(b) The Project Partnership. The Company directly owns (i) a
ninety-nine percent (99%) interest in the Project Partnership and
(ii) a one hundred percent (100%) in the General Partner, which
directly owns a one percent (1%) interest in the Project
Partnership.
4.12 Special Purpose Entities. Each of KPR and KBI is a special purpose
entity, created as a part of the vehicle through which KES holds its
interests in the Project. Neither KPR nor KBI engages in any other
business or activities or holds any material assets other than its
indirect interest in the Project, or is subject to any material
contractual liabilities, other than those incurred in connection with
the Project, all of which assets and liabilities have been disclosed
to Buyer in writing on or prior to the date of this Agreement. Such
disclosed liabilities include certain liabilities associated with
employment contracts of certain KES Entity employees and the debt of
KES Penuelas Holdings, Inc., a subsidiary of KES, to Lyon Credit
Corporation. All obligations of KES Penuelas Holdings, Inc. owing to
Lyon Credit Corporation shall be paid in full on the Closing Date. All
compensation related to the Project payable to employees of the KES
Entities pursuant to such employment contracts as of the Closing Date
(other than normal salary compensation) will be paid in full from the
proceeds of the transaction contemplated hereby.
4.13 Title to the Interest, Liens, etc. Upon consummation of the
transactions contemplated hereby at Closing, Buyer and Assignee, as
the case may be, will have, record and beneficial ownership of, and
good marketable title to the Interest, the Administrative Services
Agreement and the Project Note, free and clear of any mortgage, lien,
pledge, charge, security interest, encumbrance, option, equity or
other adverse claim thereto, except as set forth in the Shareholders
Agreement and the Credit Agreement with respect to the subordination
provisions applicable to the Project Note and the Administrative
Services Agreement.
4.14 All Required KPR Capital Contributions Made Under Shareholders
Agreement. KPR has made all capital contributions required by the
terms of the Shareholders Agreement payable prior to the date hereof.
No capital contributions are required to be made by KPR in the future,
except as required by the terms of the Shareholders Agreement.
4.15 The Project.
(a) Project Contracts. Prior to the date of this Agreement, the KES
Entities have delivered to the Buyer Parties true, correct and
complete copies of all Project Agreements, and all amendments,
supplements and modifications thereto. The KES Entities have not
received any notice of the occurrence of any default or event of
default or material breach by the Project Partnership, as such
terms are defined under any of the Project Agreements.
(b) Project Note and Administrative Services Contract. Each of the
Project Note and the Administrative Services Agreement is in full
force and effect and has not been modified, amended or
supplemented. No breach or default by any KES Entity has occurred
and is continuing under the Project Note or the Administrative
Services Agreement, or will occur as a result of the transactions
contemplated to occur at Closing pursuant to this Agreement.
(c) Ownership of Property and Assets. As of the date hereof, each of
the Company, the General Partner and the Project Partnership, as
the case may be, has good and marketable title to, and is in
peaceable possession of, all properties and assets of the
Company, the General Partner and the Project Partnership,
respectively, shown on the most recent balance sheet of each of
the Company, the General Partner and the Project Partnership, as
the case may be, free and clear of any material liens, claims or
encumbrances, except those granted by the Project Partnership,
the Company and the General Partner pursuant to the Financing
Documents.
(d) Tax Matters. Each of the KES Entities, the Company, the General
Partner and the Project Partnership has filed all federal, state
and local tax returns it is required to file, has paid any tax it
is required to pay to the extent due (other than any tax it is
contesting in good faith and by appropriate proceedings and with
appropriate reserves therefore). Neither KPR, the Company, the
General Partner nor the Project Partnership has taken any action
to affect in a material adverse manner the Grant of Industrial
Tax Exemption (Case No. 95-8-1-6) and its amendment (Case ▇▇.
▇▇-▇▇-▇ (▇▇-▇-▇-▇)▇ ▇▇▇ ▇▇▇▇ ▇▇. ▇▇-▇▇-▇(▇▇-▇-▇-▇)▇) by the
government of Puerto Rico. On November 25, 1998, the Project
Partnership filed a Petition for Conversion to the Tax Incentives
Act of 1998 (Case No. 95-8-I-6) (the "Project Partnership's Tax
Petition").
(e) Conduct of Business. The Company, the General Partner and the
Project Partnership have conducted no business other than their
activities with respect to the Project. The Company, the General
Partner and the Project Partnership have no subsidiaries except
as set forth in this Agreement.
(f) Qualifying Facility Status. Without regard to the ownership
criteria set forth in 18 C.F.R. S~292.206, the Project is
designed to meet all requirements applicable to qualifying
cogeneration facilities pursuant to 18 C.F.R. Sec 292.203(b). The
Federal Energy Regulatory Commission on November 1, 1996, in
Docket No. QF ▇▇-▇▇▇-▇▇▇, found the project to be a qualifying
facility pursuant to its regulations. A Notice of
self-recertification was filed by the Project Partnership on
December 15, 1997, in Docket No. QF ▇▇-▇▇▇-▇▇▇. Following the
consummation of the transactions pursuant to this Agreement, the
Project will no longer qualify to be a qualifying facility due
solely to the change in ownership. Other than the consummation of
the transaction pursuant to this Agreement, there is no action
threatened or pending in respect of the qualifying facility
status of the Project and there have been no other changes that
would affect the qualifying facility status of the Project.
(g) Foreign Utility Company Status. The Project Partnership is a
"foreign utility company" within the meaning to Section 33(a) of
the Public Utilities Holding Company Act of 1935, as amended by
the Energy Policy Act of 1992 ("PUHCA"), and is therefore not a
public utility company (which include both electric and gas
utility companies) under Section 2(a)(5) of PUHCA. Pursuant to
Section 33(a)(3) of PUHCA, a notice of foreign utility company
status was filed on December 15, 1997, with the Securities and
Exchange Commission. There is no action threatened or pending in
respect of the status of the Project Partnership as a foreign
utility company under PUHCA.
(h) Securities Act. Based in part on the representations and
warranties of Buyer set forth in Section 5.9 hereof, the transfer
by KPR to Buyer of the Interest is exempt from the registration
requirements of the Securities Act of 1933, as amended from time
to time, and neither KPR nor any Affiliate of KPR has taken any
action with respect to the Interest, which would adversely effect
the exemption of the sale of the Interest pursuant hereto from
such registration requirements.
(i) Employees and Employee Benefits. Neither the Company, the General
Partner nor the Project Partnership has ever maintained or
contributed to, nor has the Company, the General Partner or the
Project Partnership ever been required to contribute to, any
"employee welfare benefit plan" (as defined in Section 3(1) of
the Employee Retirement Income Security Act of 1974, as amended
("ERISA")), any "employee pension benefit plan" (as defined in
Section 3(2) of ERISA), or any foreign pension benefit plan,
which provides or results in the type of benefits described in
section 3(1) or 3(2) of ERISA. Neither the Company, the General
Partner nor the Project Partnership has any ERISA Affiliates (as
defined in Section 3(9) of ERISA).
4.16 Limitations on Representations and Warranties. KPR is selling to Buyer
and Buyer is buying from KPR the Interest, and thereby its indirect
interest in the Project Partnership and the Project, KES is assigning
to Assignee and Assignee taking in assignment from KES, the Project
Note and KBI is assigning to Buyer and Buyer is taking in assignment
from KBI, the Administrative Services Agreement, (together with the
Interest and the Project Note, the "Purchased Assets"), each on a "AS
IS" and "WITH ALL FAULTS" basis, except as expressly set forth herein.
The Buyer Parties hereby acknowledge that OTHER THAN THOSE SPECIFIC
REPRESENTATIONS AND WARRANTIES MADE IN THIS SECTION 4, THE KES
ENTITIES HAVE NOT MADE, DO NOT MAKE, AND HEREBY DISCLAIM ANY
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH
RESPECT TO SUCH PURCHASED ASSETS INCLUDING, BUT NOT LIMITED TO, THE
DESIGN, CAPACITY, CONDITION, MERCHANTABILITY, OR FITNESS FOR USE OR
FOR ANY PARTICULAR PURPOSE, OF ANY PORTION OF THE PURCHASED ASSETS,
INCLUDING WITHOUT LIMITATION, THE INTEREST AND THE INDIRECT INTEREST
IN THE PROJECT PARTNERSHIP AND/OR THE PROJECT. The Buyer Parties
further acknowledge that the KES Entities are not, except to the
extent of representation and warranties set forth in this Section 4,
responsible for compliance with requirements of any laws, ordinances,
governmental rules or regulations including, but not limited to, laws
with respect to environmental matters, patent, trademark, copyright or
trade secret infringement, or for any direct, indirect, incidental,
punitive, consequential or other damages arising out of the ownership,
use of or inability to use the Purchased Assets, including any portion
of the Interest or the indirect interest in the Project Partnership or
the Project.
5. REPRESENTATIONS AND WARRANTIES OF BUYER.
Each of the Buyer Parties represent and warrant to the KES Entities as
follows:
5.1 Organization; Authority. Buyer is a Cayman Islands exempted company
limited by shares, duly organized, validly existing and in good
standing under the laws of the Cayman Islands. Assignee is a
corporation duly organized, validly existing and in good standing
under the laws of the State of California. Buyer and Assignee each has
all requisite power and authority under its charter or other
organization documents as applicable and applicable laws to execute
and deliver this Agreement and to consummate the transactions
contemplated hereby, and to perform all its agreements and obligations
under this Agreement in accordance with its terms, and to purchase the
Interest and take assignment of the Administrative Services Agreement
and the Project Note from the KES Entities.
5.2 Corporate Approval; Binding Effect. Each of the Buyer Parties has
obtained all necessary authorizations and approvals required for the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby. This Agreement has been duly
executed and delivered by such Buyer Party and constitutes the legal,
valid and binding obligation of such Buyer Party, enforceable against
such Buyer Party in accordance with its terms, except to the extent
such enforceability is subject to the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or other law
affecting or relating to creditors' rights generally and general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
5.3 Non-Contravention. Neither the execution and delivery of this
Agreement by such Buyer Party nor the consummation by such Buyer Party
of the transactions contemplated hereby will constitute a violation
of, or be in conflict with, constitute or create a default under, or
result in the creation or imposition of any liens upon any property of
such Buyer Party pursuant to (a) the charter documents or by-laws or
other organization documents of such Buyer Party, each as amended to
date; (b) any agreement or commitment to which such Buyer Party is a
party or by which such Buyer Party or any of its properties is bound
or to which such Buyer Party or any of its properties is subject; or
(c) any statute or any judgment, decree, order, regulation or rule of
any court or other Governmental Person relating to Buyer.
5.4 Governmental Consents. No consent, approval or authorization of, or
registration, designation, declaration or filing with, any
Governmental Person is required for the execution and delivery of this
Agreement by such Buyer Party or for the consummation by such Buyer
Party of the transactions contemplated hereby, other than those
already obtained on or prior to Closing.
5.5 Brokers. Such Buyer Party has not retained, utilized or been
represented by any broker or finder in connection with the
transactions contemplated by this Agreement. No broker's, finder's or
financial advisor's fees or commissions are or will become payable by
any KES Entity arising out of any action, or omissions to act on the
part of such Buyer Party in connection with the transactions
contemplated hereby.
5.6 No Financing. The Buyer Parties have adequate funds at their disposal
to finance the Purchase Price on the Closing Date. The consummation of
the purchase described in this Agreement is not subject to the Buyer
Parties' ability to obtain financing.
5.7 Investment Company Act. Neither the Buyer nor Assignee is an
"investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended.
5.8 Due Diligence Review. Each of the Buyer Parties acknowledges and
agrees that, except for the representations and warranties of the KES
Entities contained in Section 4 hereof, it is purchasing the Interest
and taking assignment of the Administrative Services Agreement and the
Project Note on an AS IS/WHERE IS basis. Each of the Buyer Parties
further acknowledges and agrees that upon consummation of the
transactions contemplated hereby, it will have no further recourse
against the KES Entities or KES's Parent with respect to the Interest,
the Administrative Services Agreement or the Project Note, except in
connection with any breach of such representations and warranties as
contemplated by Section 4.16. The Buyer Parties are sophisticated and
knowledgeable with respect to independent power projects and related
matters and have performed their own independent investigation, with
due diligence, assisted by legal counsel and other professionals, of
the investment represented by the sale of the Interest, the
Administrative Services Agreement and the Project Note and have formed
their own independent assessment of the risks and potential returns of
the Interest, the Administrative Services Agreement and the Project
Note. The Buyer Parties acknowledge that they have completed to their
satisfaction their own due diligence investigation with respect to the
KES Entities, the Interest, the Project Note and the Administrative
Services Agreement. The Buyer Parties, except as to any representation
expressly set forth in a closing document, are not relying, to any
extent, on any representation or statement of any KES Entity or KES's
Parent.
5.9 No Registration; Investment Representation; Accredited Investor;
Sophisticated Person. The Buyer Parties acknowledge that the
Interest has not been registered under any federal, state or local
securities laws, and may not be resold unless permitted under
applicable exemptions contained in such securities laws or upon
satisfaction of the registration or qualification requirements of such
securities laws (nor does KPR have any obligation to effect any such
registration). The Buyer Parties will refrain from acquiring,
transferring or otherwise disposing of the Interest or any interest
therein, in such manner as to violate any registration requirements of
any applicable federal, state or local securities laws, and the rules
and regulations promulgated thereunder regulating the disposition
thereof. Buyer is acquiring the Interest for its own account for
investment purposes only, and not with a view to, or for sale in
connection with, any distribution or public offering thereof or any
portion thereof. The Buyer Parties have extensive financial experience
with investments such as the investment contemplated by this Agreement
and therefore have the ability to protect their own interests in
connection with this Agreement. The Buyer is a "Sophisticated Person"
as defined in the Credit Agreement.
5.10 Employee Benefits Plan. The Buyer Parties are buying the Interest, the
Administrative Services Agreement and the Project Note with their
general assets. No funds used to acquire the Interest, the
Administrative Services Agreement or the Project Note will be
furnished directly or indirectly out of the assets of or in connection
with any Employee Benefit Plan.
5.11 Status as an "Electric Utility". Each Buyer Party is a subsidiary of
an electric utility holding company exempt under Section 3(a)(1) of
PUHCA.
5.12 Compliance with Confidentiality Agreement. The Buyer Parties have
complied with all the terms and conditions of that certain
Confidentiality Agreement, by and between KES and Assignee, and
attached hereto as Exhibit B (the "Confidentiality Agreement").
6. INTENTIONALLY OMITTED.
7. CONDITIONS PRECEDENT TO BUYER PARTIES' OBLIGATIONS.
The obligation of the Buyer Parties to consummate the Closing shall be
subject to the satisfaction at the Closing of each of the following
conditions:
7.1 Representations and Warranties True at Closing. The representations
and warranties made by the KES Entities in or pursuant to this
Agreement shall be true and correct in all material respects at and as
of the Closing Date.
7.2 Compliance With Agreement. The KES Entities shall have performed and
complied in all material respects with all of their obligations under
this Agreement to be performed or complied with by the KES Entities on
or prior to the Closing Date.
7.3 Officer's Certificate. The KES Entities shall have delivered to the
Buyer Parties in writing, at and as of the Closing, a certificate, in
form and substance satisfactory to the Buyer Parties, certifying that
the conditions in each of Sections 7.1 and 7.2 hereof have been
satisfied.
7.4 Resolution of the QF Issue. As of the Closing Date, KES and Assignee
shall have entered into that certain Waiver Agreement with the Puerto
Rico Electric Power Authority ("PREPA"), EcoElectrica, L.P., and Enron
Development Corp., substantially in the form of Exhibit C hereto (the
"Waiver Agreement").
7.5 Consents. The Buyer Parties shall have received copies of any and all
consents set forth on Schedule 7.5, which shall be in full force and
effect.
7.6 Suits and Proceedings. There shall not be pending or threatened
against the Buyer Parties, any KES Entity, the Company, the General
Partner or the Project Partnership, any suit, action, proceeding or
investigation seeking to challenge, enjoin, delay or set aside any of
the transactions contemplated hereby.
7.7 No Material Adverse Change. Between July 31, 1998, and the Closing
Date, there shall be no change in the business or the assets of the
Company, the General Partner, any KES Entity, or the Project
Partnership, including any Unfavorable Decision (as defined in the
Credit Agreement), which either individually or in the aggregate could
reasonably be expected to have a Material Adverse Effect.
7.8 Resignations of Directors and Officers. Except as set forth on
Schedule 7.8 hereto, all the directors, officers and authorized
signatories appointed by KPR to the Company, the General Partner and
the Project Partnership shall have resigned their positions with the
Company, the General Partner or the Project Partnership on or prior to
the Closing Date, and all necessary notices shall have been given
pursuant to the Shareholders Agreement and the Articles of Association
and other organizational documents of the Company, the General Partner
and the Project Partnership, as applicable, substituting
representatives of the Buyer Parties on the Board of Directors
pursuant to the Shareholders Agreement and the Articles of Association
of the Company, the General Partner and the Project Partnership as
applicable.
7.9 Releases. The KES Entities shall have provided to the Buyer Parties at
Closing executed releases of all liens held by Lyon Credit Corporation
and by each Person party to the employment contracts listed on
Schedule 4.6 a Satisfaction and Discharge from the Bank of New York,
as Indenture Trustee and representative of bondholders of KES's Parent
evidencing satisfaction and discharge of claims by the bondholders, a
receipt or other appropriate documentation acknowledging receipt of
funds by the bankruptcy trustee in respect of the KENETECH Windpower
Inc. estate in the full amount of KES's Settlement Obligation as
defined in the Settlement Agreement in form and substance reasonably
satisfactory to the Buyer Parties.
7.10 Affidavit. An affidavit of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ in form and substance
acceptable to the Buyer Parties addressing certain issues concerning
the transactions contemplated under this Agreement shall be signed.
7.11 Fieldstone Fairness Opinion. Fieldstone Private Capital Group, L.P.,
financial advisor to KES, shall have delivered to the Buyer Parties a
written opinion, addressed to the Buyer Parties and dated the Closing
Date, addressing the fairness of the terms and conditions of the
transactions contemplated under this Agreement.
7.12 KPMG Comfort Letter. KMPG, auditors of KES's Parent shall have
delivered to the Buyer Parties a comfort letter dated as of the
Closing Date and covering all information included in KES's Parent's
Form 10-Q filed with the Securities and Exchange Commission for the
quarter ended September 30, 1998, including a bring down of such
information as of the Closing Date, which shall identify any material
changes in the financial condition of KES's Parent subsequent to
September 30, 1998.
7.13 Notices Under the Credit Agreement. The Project Partnership shall
provide a copy to the Buyer Parties of the acknowledgment of receipt
by the Administrative Agent of the draft PREPA Waiver Agreement
including an acknowledgment that no further action under the Credit
Agreement is required by the Project Partnership in respect of
executing the PREPA Waiver Agreement, other than the delivery of a
certified copy of the same promptly after the execution and delivery
thereof.
7.14 Opinion of Counsel.
(a) ▇▇▇▇▇▇▇ ▇▇▇▇ LLP, special counsel the KES Entities, shall have
delivered to the Buyer Parties a written opinion, addressed to
Buyer and dated the Closing Date, covering the matters referred
to in Sections 4.1, 4.2, 4.3(a), Section 4.3(c) hereof relating
to the Settlement Agreement and 4.10 with respect to KES and KBI;
(b) ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, special counsel to KPR in Bermuda and
▇▇▇▇▇▇, Westwood & Riegels, special counsel to the KES Entities
in the British Virgin Islands ("HWR"), shall have each delivered
to the Buyer Parties an opinion, addressed to Buyer Parties and
dated the Closing Date, having the matters referenced in 4.1,
4.2, 4.3(a) and 4.10 with respect to KPR; and (c) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
and Finger, special Delaware counsel to KES's Parent, shall have
delivered to the Buyer Parties a written opinion, addressed to
the Buyer Parties and dated the Closing Date, covering certain
issues identified by the Parties to the KES Entities, including
but not limited to due authorization by KES's Parent of the
transactions contemplated by this Agreement and the corporate
separateness of KES's Parent and the KES Entities (other than
KPR).
7.15 Certificate, Documents.
The Buyer Parties shall have received such other certificates and
documents as may be reasonably requested by it with respect to the
foregoing matters.
8. CONDITIONS PRECEDENT TO KES ENTITY OBLIGATIONS.
The obligation of the KES Entities to consummate the Closing shall be
subject to the satisfaction, at the Closing, of each of the following
conditions:
8.1 Representations and Warranties True at Closing. The representations
and warranties made by the Buyer Parties in this Agreement shall be
true and correct in all material respects at and as of the Closing
Date.
8.2 Compliance with Agreement. Each of the Buyer Parties shall have
performed and complied in all material respects with all of its
obligations under this Agreement that are to be performed or complied
with by it at or prior to the Closing.
8.3 Officer's Certificate. The Buyer Parties shall have delivered to the
KES Entities in writing, at and as of the Closing, a certificate, in
form and substance satisfactory to the KES Entities, to the effect
that the conditions in each of Sections 8.1 and 8.2 hereof have been
satisfied.
8.4 Opinion of Counsel. Hunton & ▇▇▇▇▇▇▇▇, counsel to Buyer Parties, shall
have delivered to the KES Entities a written opinion, addressed to the
KES Entities and dated the Closing Date, covering the matters referred
to in Sections 5.1, 5.2 and 5.3. ▇.▇. ▇▇▇▇▇▇ & Company, special
counsel to the Buyer in the Cayman Islands, shall have delivered to
the KES Entities a written opinion, addressed to the KES Entities and
dated the Closing Date, covering the matters referenced to in Sections
5.1, 5.2 and 5.3 with respect to the Buyer.
8.5 Assumption of Certain Obligations. Buyer shall have executed and/or
delivered the documentation required in Section 3.2(b) and the cash
collateral pledged by KES to secure its obligation to Union Bank of
California, shall have been released by Union Bank of California to
KES.
8.6 Certificates, Documents. The KES Entities shall have received such
other certificates and documents as may be reasonably requested by
them with respect to the foregoing material.
9. CONFIDENTIAL INFORMATION. The KES Entities and the Buyer Parties agree that
the Confidentiality Agreement shall remain in full force and effect for the
duration thereof, and that the parties hereto shall be governed by its
terms and conditions, which are hereby incorporated into this Agreement by
reference.
10. HSR ACT. Each of the Buyer Parties and the KES Entities acknowledge that
they have filed with the United States Department of Justice and the United
States Federal Trade Commission the Notification and Report Form required
to be filed under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976,
as amended (the "HSR Act"), concerning the transactions contemplated
hereby, and that the waiting period for such filing specified in the HSR
Act has expired.
11. POST CLOSING TAX INCENTIVE. Within five (5) business days of receipt by the
Company of notice of final approval not subject to appeal by the Government
of Puerto Rico of the Project Partnership's Tax Petition referred to in
Section 4.15(d), the Buyer Parties shall remit to KES by wire transfer to
Sanwa Bank California, San Francisco, CA to ABA #▇▇▇▇▇▇▇▇▇, for the account
of KENETECH Energy Systems, Inc., Account No. 0668-26065, a payment in an
amount equal to $5,000,000.
12. RELEASE. In consideration of the Purchased Assets, and for other valuable
consideration, the receipt of which is hereby acknowledged, each of the
Buyer Parties, for itself and on behalf of its successors and assigns,
hereby releases and discharges the KES Entities and KES's Parent, their
past and present partners, heirs, assigns, successors, officers, directors,
agents, employees and affiliates of and from any and all actions, causes of
actions, claims, demands, damages, liabilities, costs or expenses of any
kind arising from the beginning of time to the date hereof in connection
with the KES Entities, KES's Parent, the Company, the General Partner, the
Project Partnership and/or the Project, except to the extent any liability
for breach of representations and warranties set forth in Section 4 to the
extent set forth in Section 4.13.
13. GENERAL.
13.1 Expenses. All expenses of the preparation, execution and consummation
of this Agreement and of the transactions contemplated hereby,
including, without limitation, attorneys', accountants' and outside
advisers' fees and disbursements, shall be borne by (a) the Buyer
Parties, if incurred for the Buyer Parties' account or (b) the KES
Entities, if incurred for the account of the KES Entities or any of
the KES Entities. Notwithstanding the foregoing, all commissions, fees
and expenses of Fieldstone Private Capital Group, L.P. shall be paid
by the KES Entities, except for those incurred by the Buyer Parties at
their request, which shall be paid by the Buyer Parties.
13.2 Notices. All notices, demands and other communications hereunder shall
be in writing or by written telecommunication, and shall be deemed to
have been duly given if delivered personally or by overnight courier
or if mailed by certified mail, return receipt requested, postage
prepaid, or sent by written telecommunication, as follows:
If to the KES Entities, to: KENETECH Energy Systems, Inc.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
with copies sent contemporaneously to:
KENETECH Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President and
Chief Financial Officer
and to: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to Assignee, to: Edison Mission Energy
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Regional Vice President
If to Buyer, to: EME del Caribe
c/o ▇.▇. ▇▇▇▇▇▇ & Company
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Director
with a copy sent contemporaneously to:
Edison Mission Energy
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇, Esq.
Director, Legal Department
Americas
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Hunton & ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
13.3 Entire Agreement. This Agreement, together with the Confidentiality
Agreement, incorporated herein by reference and the Assignment and
Assumption Agreements, entered into contemporaneously herewith,
contain the entire understanding of the parties, supersede all prior
agreements and understandings relating to the subject matter hereof
and shall not be amended except by a written instrument hereafter
signed by all of the parties hereto. If the terms of this Agreement
shall conflict with any of those of the Assignment and Assumption
Agreements, this Agreement shall govern.
13.4 Governing Law; CONSENT TO JURISDICTION.
(a) The validity and construction of this Agreement shall be governed
by the internal laws (and not the choice-of-law rules other than
Section 5-1401 of the New York General Obligations Law) of the
State of New York.
(b) The parties agree that any suit based upon or arising out of this
Agreement or the dealings or the relationship between or among
the KES Entities and Buyer Parties and either party's successors
and assigns may be brought in the courts of the State of New York
or the Federal Court of the Southern District of New York and
consent to the non-exclusive jurisdiction of such court and to
service of process in any such suit being made upon either party
by mail in the manner specified in Section 13.2 hereof. Each of
Buyer Parties and the KES Entities hereby waives any objection
that it may now or hereafter have to the venue of any such suit
or any such court or that such suit was brought in an
inconvenient forum.
13.5 Sections and Section Headings. All enumerated subdivisions of this
Agreement are herein referred to as "Section" or "subsection." The
headings of Sections and subsections are for reference only and shall
not limit or control the meaning thereof.
13.6 Assigns. This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective heirs, successors and
permitted assigns. Neither this Agreement nor the obligations of any
party hereunder shall be assignable or transferable by such party
without the prior written consent of the other parties hereto, except
that either of the Buyer Parties may assign or transfer its rights
hereunder to one or more Affiliates, without the prior written consent
of the KES Entities. Such transfer shall not relieve either of the
Buyer Parties of any of its obligations hereunder.
13.7 Further Assurances. The KES Entities and Buyer Parties shall execute
and deliver to all appropriate other parties such other instruments as
may be reasonably required in connection with the performance of this
Agreement and each shall take all such further actions as may be
reasonably required to carry out the transactions contemplated by this
Agreement.
13.8 No Implied Rights or Remedies. Except as otherwise expressly provided
herein, nothing herein expressed or implied is intended or shall be
construed to confer upon or to give any person, firm or corporation,
other than the KES Entities and the Buyer Parties and their respective
shareholders, any rights or remedies under or by reason of this
Agreement.
13.9 Knowledge. Whenever the phrase "to the knowledge of the KES Entities"
or another similar qualification is used herein, the relevant
knowledge is limited solely to the actual knowledge the officers and
directors of the KES Entities, without imputing to the KES Entities
any knowledge of any other Person.
13.10 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
13.11 Satisfaction of Conditions Precedent. The KES Entities and Buyer
Parties will each use their best efforts to cause the satisfaction of
the conditions precedent contained in this Agreement; provided,
however, that nothing contained in this Section 14.11 shall obligate
any party hereto to waive any right or condition under this Agreement.
13.12 Time is of the Essence and Best Efforts. With regard to all dates and
time periods set forth or referred to in this Agreement, time is of
the essence.
13.13 Survival of Representations and Warranties. All representations and
warranties contained herein shall survive the execution and delivery
of this Agreement and the Closing, regardless of any investigation
made by or on behalf of any party hereto; provided, however, that all
representations and warranties (and any claim for indemnification made
in respect thereof) shall expire and be of no further force and effect
from and after the date six (6) months following the Closing except to
the extent a claim is made in good faith by the aggrieved party
against the other party with respect thereto prior to the expiration
of such 6 month period. If, under any applicable federal or state
bankruptcy, insolvency, reorganization or other laws relating to
creditors' rights generally, any of the transfers contemplated by
S3.2(a) or the payment contemplated by S3.2(d) is avoided or
invalidated within six (6) years of the Closing, Buyer Parties shall
have a claim for damages to the extent of any such avoidance or
invalidation; and any claim for damages they may have as a result of
such avoidance or invalidation shall be expressly preserved.
IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto
have caused this Agreement to be duly executed and delivered by their respective
duly authorized officers as of the date and year first above written.
SELLER:
KES PUERTO RICO L.P.
By: KES LNG, Ltd.,
its General Partner
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
KENETECH ENERGY SYSTEMS, INC.
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
KES BERMUDA, INC.
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
BUYER PARTIES:
EME DEL CARIBE
By:
Name:
Title:
EDISON MISSION ENERGY
By:
Name:
Title:
Schedule 4.5
Proceedings
1. Settlement Agreement - KENETECH Energy Systems, Inc.
Schedule 4.6
Material Liabilities
1. Employment Contracts for:
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Schedule 7.5
Required Consents
1. Filing with Office of Industrial Tax Exemption of Puerto Rico, request
for approval of Transfer.
2. Puerto Rico Electric Power Authority waiver of requirement under Power
Purchase Agreement that Project maintain Qualifying Facility status by
entry into a Waiver Agreement, substantially in the form of Exhibit C.
Schedule 7.8
Resignation of Directors,
Officers and Authorized Signatories
The following individuals shall resign as of the Closing Date:
1. Company:
A. Directors: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Director
B. Officers: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Assistant Secretary
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Assistant Secretary
C. Authorized Signatory:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ El ▇▇▇▇▇
2. General Partner: EcoElectrica, Ltd.
A. Directors: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Director
B. Officers: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Assistant Secretary
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Assistant Secretary
C. Authorized Signatory:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ El ▇▇▇▇▇
3. Project Partnership: None
Exhibit C
Form of Waiver Agreement
(form to be attached)