Exhibit 4.6
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LEASE SUBORDINATION AGREEMENT
dated as of December __, 2001
by and among
HOMER CITY OL1 LLC,
as the Owner Lessor,
GE CAPITAL OWNER PARTICIPANT,
as the Owner Participant,
EME HOMER CITY GENERATION L.P.,
as the Facility Lessee
AND
THE BANK OF NEW YORK
as successor to
UNITED STATES TRUST COMPANY OF NEW YORK,
as the Security Agent
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LEASE SUBORDINATION AGREEMENT
This LEASE SUBORDINATION AGREEMENT, dated as of December __,
2001 (this "AGREEMENT"), is by and among HOMER CITY OL1 LLC, as the Owner Lessor
under the Facility Lease referred to below, GE CAPITAL OWNER PARTICIPANT, as the
Owner Participant under the Participation Agreement referred to below, EME HOMER
CITY GENERATION L.P., as the Facility Lessee under the Facility Lease referred
to below and THE BANK OF NEW YORK, as successor to UNITED STATES TRUST COMPANY
OF NEW YORK, not in its individual capacity but solely as the Security Agent
under the Lease Indenture ( as defined in the Participation Agreement referred
to below).
RECITALS
WHEREAS, the holders of the Initial Lessor Notes (as such term
is defined in the Participation Agreement) have purchased the Initial Lessor
Notes from the Owner Lessor and have been granted a security interest in the
Facility Lease as collateral for the Initial Lessor Notes;
WHEREAS, contemporaneously herewith EME Homer City Generation
L.P. ("HOMER CITY" or the "FACILITY LESSEE"), a wholly owned subsidiary of
Edison Mission Midwest Holdings Co. ("HOLDINGS"), will enter into a transaction
pursuant to the Participation Agreement by and among Homer City, the Owner
Lessor, Wells Fargo Bank Northwest, National Association, not in its individual
capacity but solely as Owner Manager, the Owner Participant, Homer City Funding
LLC, as Lender, the Security Agent and United States Trust Company of New York,
not in its individual capacity but solely as Bondholder Trustee (as amended,
modified and supplemented and in effect from time to time, the "PARTICIPATION
AGREEMENT") whereby Homer City would sell certain of its generating assets to
the Owner Lessor and the Owner Lessor would lease such generating assets to
Homer City under the Facility Lease;
WHEREAS, in connection with the transactions contemplated by
the Participation Agreement, the parties hereto will agree to subordinate
certain claims against Homer City under the Participation Agreement and the
other Operative Documents to the rights of holders of the Initial Lessor Notes
(as defined in the Participation Agreement as of the date hereof and as such
term may hereafter be modified with the consent of the Security Agent); and
WHEREAS, the execution and delivery of this Agreement is a
condition precedent to the effectiveness of the Participation Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS; PRINCIPLES OF CONSTRUCTION
Section 1.1 DEFINITIONS.
(a) PARTICIPATION AGREEMENT. Unless otherwise expressly
provided herein, capitalized terms used but not defined in this Agreement shall
have the meanings given to such terms in Appendix A to the Participation
Agreement.
(b) OTHER DEFINED TERMS. The following terms, when used
herein, shall have the following meanings:
"SUBORDINATED LEVERAGED LEASE OBLIGATIONS" shall
mean, the Component A of Basic Lease Rent, the Component A of
Termination Value and any Supplemental Rent constituting Excepted
Payments now or hereafter owed by Homer City to the Owner Participant
or the Owner Lessor under the Operative Documents; provided, however,
that the following items shall be excluded from the Subordinated
Leveraged Lease Obligations: (a) any Excepted Payments owing to the
Owner Lessor on account of fees and indemnities owed to the Owner
Manager; and (b) Rent paid from the Reserve Account.
"PROCEEDING" shall have the meaning given to such
term in SECTION 3.2.
"SENIOR CLAIMS" shall have the meaning given to such
term in SECTION 2.1(a).
"SENIOR LEVERAGED LEASE OBLIGATIONS" shall mean Basic
Lease Rent (other than the Component A of Basic Lease Rent),
Termination Value (other than the Component A of Termination Value),
any Supplemental Rent not constituting Subordinated Leveraged Lease
Obligations (whether for indemnities, costs, expenses or otherwise) now
or hereafter owed by Homer City to the Owner Lessor, the Security
Agent, the Lease Indenture Trustee,
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the Lender or the Bondholder Trustee under the Operative Documents and
any other sum now or hereafter owed with respect to the Initial Lessor
Notes (whether for principal thereof, interest thereon, or make-whole
payments thereof or otherwise).
"SUBORDINATED CLAIMS" shall mean, as at any date of
determination, the aggregate amount of all Subordinated Leveraged Lease
Obligations for all Fiscal Quarters ending on or immediately prior to
such date to the extent not discharged prior to such date pursuant to
and in compliance with the provisions of Section 6.9 of the
Participation Agreement.
"SUBORDINATED PARTIES" shall mean the Owner Lessor
and the Owner Participant in their capacity as holders of the
Subordinated Claims.
Section 1.2 PRINCIPLES OF CONSTRUCTION. Unless otherwise
expressly provided herein, the principles of construction set forth in the
Participation Agreement shall apply to this Agreement.
ARTICLE II
SUBORDINATION PROVISIONS
Section 2.1 SUBORDINATION OF CLAIMS. Until all Senior
Leveraged Lease Obligations shall have been paid in full:
(a) the Subordinated Claims shall be subordinate, to the
extent and in the manner hereinafter set forth, to the prior payment of, and
junior in right of payment to, any and all Senior Leveraged Lease Obligations
whether now existing or hereafter incurred or created (collectively, the "SENIOR
CLAIMS");
(b) Homer City shall not, directly or indirectly, except
with respect to withdrawals from the Equity Account pursuant to Section 4.6(b)
of the Amended Security Desposit Agreement and Section 17.1(g) of the Facility
Lease, make any payment on account of, or transfer any collateral for any part
of, any Subordinated Claims; PROVIDED, HOWEVER, that, as long as no Lease Event
of Default (other than a Rent Default Event) has occurred and is continuing
under the Facility Lease and subject to Section 6.9 of the Participation
Agreement and the applicable provisions of the Amended Security Deposit
Agreement, Homer City may make payments of Subordinated Claims consisting of
Basic Lease Rent, Supplemental Rent and Renewal Lease Rent; and
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(c) without the consent of the Lease Indenture Trustee,
the Subordinated Parties shall not demand, sue for or accept (other than with
respect to withdrawals from the Equity Account pursuant to Section 4.6(a)(i) and
Section 4.6(b) of the Amended Security Deposit Agreement and Section 17.1(g) of
the Facility Lease and withdrawals from the Reserve Account pursuant to Section
4.4 of the Amended Security Deposit Agreement) from Homer City any payment or
collateral in respect of any Subordinated Claims, or take any other action to
enforce its rights or exercise any remedies in respect of any Subordinated
Claims (whether upon the occurrence or during the continuation of a Lease Event
of Default under the Facility Lease).
(d) Neither Homer City nor the Subordinated Parties shall
otherwise take any action prejudicial to or inconsistent with the priority
position of the Secured Parties over the Subordinated Parties created by this
Section 2.1.
Section 2.2 RELIANCE. All Senior Claims shall conclusively be
deemed to have been created, contracted or incurred in reliance on the
subordination provisions contained in this Agreement and all dealings between
Homer City, the Subordinated Parties and each of the holders of Senior Claims
shall be deemed to have been consummated in reliance upon the subordination
provisions contained herein.
Section 2.3 OTHER HOLDERS. The subordination provisions set
forth in this Agreement shall be binding upon transferees or assignees of each
of the Subordinated Parties and upon each other holder of Subordinated Claims
and shall inure to the benefit of transferees or assignees of every holder of
the Initial Lessor Notes.
ARTICLE III
WRONGFUL COLLECTIONS
Section 3.1 TURNOVER. Should any payment on account of, or any
collateral for any part of, any Subordinated Claims be received by the
Subordinated Party in violation of this Agreement or the provisions of SECTION
6.9 of the Participation Agreement, such payment or collateral shall be
delivered forthwith to the Security Agent in the same form as so received (with
any necessary endorsement). Until so delivered, any such payment or collateral
shall be held by such Subordinated Party in trust for the holders of the Senior
Claims and shall not be commingled with other funds or property of such
Subordinated Party. The Security Agent is hereby irrevocably authorized to
supply any endorsement or assignment which may have been omitted which the
Security Agent may reasonably deem
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necessary or advisable to enforce its rights under this Agreement, including,
without limitation, authority to receive, endorse and collect all instruments
made payable to any Subordinated Party representing any distribution, interest
payment or other payments in respect of the Subordinated Claims.
Section 3.2 SURVIVAL OF OBLIGATION. The obligation of the
Subordinated Party to deliver to the Security Agent any payment or collateral
received in connection with any Subordinated Claims, as set forth in SECTION
3.1, shall survive and shall not be in any way affected by the result of any (a)
insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment,
composition or other similar proceeding relating to Homer City, its property or
its creditors as such, (b) proceeding for any liquidation, dissolution or other
winding-up of Homer City, voluntary or involuntary, whether or not involving
insolvency or bankruptcy proceedings, (c) assignment for the benefit of
creditors, (d) other marshalling of the assets of Homer City or (e) general
meeting of creditors of Homer City, in each case, under the laws of the United
States or any other jurisdiction (any such event, a "PROCEEDING").
ARTICLE IV
PROCEEDINGS
Section 4.1 COMMENCEMENT OF PROCEEDINGS. Except to the extent
otherwise provided herein, no Subordinated Party shall commence, or join with
any other creditor or creditors of Homer City in commencing, any Proceeding
against Homer City without the consent of the Lease Indenture Trustee.
Section 4.2 PAYMENTS AND DISTRIBUTIONS. In the event of any
Proceeding, until all Senior Leveraged Lease Obligations shall have been paid in
full, any payment or distribution of any kind or character on account of a
Subordinated Claim, whether in cash, property or securities, which, but for the
subordination provisions of this Agreement would otherwise be payable or
deliverable upon or in respect of Subordinated Claims, shall instead be paid
over or delivered to the Security Agent and no holder of Subordinated Claims
shall be entitled to receive any such payment or distribution or any benefit
therefrom.
Section 4.3 ENFORCEMENT OF SUBORDINATED CLAIMS.
(a) COOPERATION. The Subordinated Parties shall cooperate
fully with the Security Agent and perform all acts reasonably requested by the
Security Agent to enable the Security Agent to enforce any Subordinated Claims,
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including, without limitation, filing appropriate proofs of claim and executing
and delivering all necessary powers of attorney, assignments or other
instruments.
(b) ENFORCEMENT BY THE SUBORDINATED PARTY. After the
commencement of any Proceeding, the requesting Subordinated Party may (but shall
not be required to) proceed to file a proof of claim, enter appearances and file
affirmative or responsive pleadings with respect to such Subordinated Claims and
take such further steps with respect thereto, not inconsistent with this
Agreement, as the requesting Subordinated Party may deem proper.
(c) SUBROGATION. The Subordinated Parties shall not have
any subrogation or other rights as a holder of Senior Claims, and each
Subordinated Party hereby irrevocably waives all such rights of subrogation and
all rights of reimbursement or indemnity whatsoever and all rights of recourse
to any security for any Senior Claims, until such time as all Senior Leveraged
Lease Obligations shall have been paid in full. Subject to and from and after
the payment in full of all Senior Leveraged Lease Obligations, each Subordinated
Party shall be subrogated to any rights of the holders of Senior Claims to
receive payments or distributions of cash, property or securities of Homer City
applicable to any Subordinated Claims until all amounts owing on such
Subordinated Claims shall be paid in full.
(a) ENFORCEMENT BY THE HOLDERS OF THE SENIOR CLAIMS. At any
Proceeding, until all Obligations shall have been paid in full, the holders of
the Senior Claims are hereby irrevocably authorized (but not required) to:
(i) enforce claims comprising Subordinated Claims in
the name of the Subordinated Party by proof of debt, proof of
claim, suit or otherwise;
(ii) collect any assets of any Owner Lessor
distributed, divided or applied by way of dividend or payment,
and any securities issued, in each case, on account of
Subordinated Claims and apply the same, or the proceeds of any
realization upon the same that the Indenture Estate in their
discretion elect to effect, to Senior Claims until all
Obligations shall have been paid in full; provided, however,
that the Lease Indenture Estate shall render any surplus to
the Subordinated Party or its affiliates, as their interests
appear, or interplead such surplus with a court of competent
jurisdiction;
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(iii) vote claims comprising Subordinated Claims to
accept or reject any plan of partial or complete liquidation,
reorganization, arrangement, composition or extension; and
(iv) take generally any action in connection with
any such Proceeding which the Subordinated Party might
otherwise take.
ARTICLE V
LIMITATION ON ACTIONS
Section 5.1 ACTIONS PROHIBITED. Until all Senior Leveraged
Lease Obligations shall have been paid in full, except as otherwise expressly
provided herein or in the other Operative Documents, the Subordinated Parties
shall not, without the prior written consent of the Security Agent:
(a) take, obtain or hold (or permit anyone acting on its
behalf to take, obtain or hold) any assets of Homer City (other than Homer
City's interest in the Facility and the Facility Site), whether as a result of
any administrative, legal or equitable action, or otherwise, in violation of the
subordination provisions contained in this Agreement;
(b) commence, prosecute or participate in (i) any
administrative, legal or equitable action against or involving Homer City
relating to the payment or collection of any Subordinated Claims, including,
without limitation, any Proceeding, or (ii) any administrative, legal or
equitable action to (a) enforce or collect any judgment obtained in respect of
any Subordinated Claims, (b) enforce or exercise remedies seeking to collect or
enforce payment of any Subordinated Claims or (c) enforce or exercise remedies
under or pursuant to any lien or other security interest securing any
Subordinated Claims; or
(c) exercise any other rights or remedies to enforce the
payment or collection of any Subordinated Claims or any collateral security
provided with respect to such Subordinated Claims.
Section 5.2 DEFENSE IN ACTION. If the Subordinated Party, in
violation of the provisions herein set forth, shall commence, prosecute or
participate in any suit, action, case or Proceeding referred to in Section 5.1,
the Owner Lessor may interpose as a defense or plea the provisions set forth
herein, and any holder of any Senior Claims may intervene and interpose such
defense or plea in its own name or in the name of the Owner Lessor, and shall,
in any event, be entitled to restrain the enforcement of the provisions of any
Subordinated Claims in its own name or in the
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name of the Owner Lessor, as the case may be, in the same suit, action, case or
Proceeding or in any independent suit, action, case or Proceeding.
ARTICLE VI
SUBORDINATION ABSOLUTE
Section 6.1 SURVIVAL OF RIGHTS. The rights under this
Agreement of the holders of Senior Claims as against the Subordinated Parties
shall remain in full force and effect without regard to, and shall not be
impaired or affected by:
(a) any act or failure to act on the part of Homer City;
(b) any extension or indulgence in respect of any payment
or prepayment of any Senior Claims or any part thereof or in respect of any
other amount payable to any holder of any Senior Claims;
(c) any amendment, modification or waiver of, or addition
or supplement to, or deletion from, or compromise, release, consent or other
action in respect of, any of the terms of any Senior Claims;
(d) (i) any exercise or non-exercise by the holder of any
Senior Claims of any right, power, privilege or remedy under or in respect of
such Senior Claims or the subordination provisions contained herein, (ii) any
waiver by the holder of any Senior Claims of any right, power, privilege or
remedy or of any default in respect of such Senior Claims or the subordination
provisions contained herein or (iii) any receipt by the holder of any Senior
Claims or any failure by such holder to perfect a security interest in, or any
release by such holder of, any security for the payment of such Senior Claims;
(e) any merger or consolidation of Homer City or any of
its subsidiaries into or with other Person, or any sale, lease or transfer of
any or all of the assets of Homer City or any of its subsidiaries to any other
Person, PROVIDED that such merger or consolidation is effected in compliance
with the relevant provisions of the Participation Agreement;
(f) any payment or other distribution to any holder of
any Senior Claims in any Proceeding;
(g) absence of any notice to, or knowledge by, the
Subordinated Parties of the existence or occurrence of any of the matters or
events set forth in the foregoing clauses (a) through (f); or
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(h) any other circumstance.
The provisions of this SECTION 6.1 are not in derogation of,
and are not intended to affect in any way, any rights or remedies of, or
available to, the Subordinated Parties that may arise under the other Operative
Documents directly or indirectly as a consequences of acts, events or
circumstances set forth above.
Section 6.2 Waivers.
(A) WAIVER OF DEFENSES. Each Subordinated Party hereby
irrevocably waives, in any proceeding by the holders of Senior Claims to enforce
their rights under this Agreement, any defense based on the adequacy of a remedy
at law which might be asserted as a bar to the remedy of specific performance of
this Agreement.
(B) OTHER WAIVERS. Each Subordinated Party hereby
irrevocably waives (i) notice of any of the matters referred to in SECTION 6.1,
(ii) all notices which may be required, whether by statute, rule of law or
otherwise, to preserve intact any rights of any holder of any Senior Claims
against Homer City, including, without limitation, any demand, presentment and
protest, or any proof of notice of nonpayment under any document evidencing such
Senior Claims, (iii) notice of the acceptance of or reliance on this Agreement
by the holders of Senior Claims, (iv) notice of any renewal, extension or
accrual of any Senior Claims, or any loans made or other action taken in
reliance on this Agreement, (v) any right to the enforcement, assertion or
exercise by any holder of any Senior Claims of any right, power, privilege or
remedy conferred in any document evidencing such Senior Claims, or otherwise,
(vi) any requirement of diligence on the part of any holder of any Senior
Claims, (vii) any requirement on the part of any holder of any Senior Claims to
mitigate damages resulting from any default under any documents evidencing such
Senior Claims and (viii) any notice of any sale, transfer or other disposition
of any Senior Claims by any holder thereof.
Section 6.3 ASSENT. Each Subordinated Party hereby irrevocably
assents to (a) any renewal, extension or postponement of the time of payment of
any Initial Lessor Notes or any other indulgence with respect thereto, (b) any
increase in the amount of any Initial Lessor Notes, subject to the provisions of
the Operative Documents, (c) any substitution, exchange or release of collateral
for any Initial Lessor Notes, (d) the addition or release of any Person
primarily or secondarily liable for any Initial Lessor Notes and (e) the
provisions of any instrument, security or other writing evidencing any Initial
Lessor Notes.
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ARTICLE VII
HOMER CITY OBLIGATIONS
The provisions of this Agreement are intended solely for the
purpose of defining the relative rights and obligations of the Subordinated
Parties and the holders of Senior Claims. Nothing contained herein is intended
to affect the relative rights of the Subordinated Parties and creditors of Homer
City other than the holders of Senior Claims.
ARTICLE VIII
OPINION OF COUNSEL
Each Subordinated Party shall deliver to the Security Agent an
opinion of counsel in form and substance satisfactory to the Security Agent, as
to the enforceability of this Agreement against such Subordinated Party.
ARTICLE IX
RIGHTS OF OWNER LESSOR AND OWNER PARTICIPANT
Neither this Agreement not the provisions herein shall prevent
the Owner Participant or the Owner Lessor, as the case may be, from exercising
its Section 9.1 Rights, other than the rights to demand and receive payments on
account of Subordinated Claims.
ARTICLE X
TERMINATION
This Agreement shall terminate when all Senior Leveraged Lease
Obligations with respect to the Initial Lessor Notes shall have been paid in
full.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1 WAIVERS, AMENDMENTS.
(a) The provisions of this Agreement may from time to
time be amended, modified or waived, if such amendment, modification or waiver
is in writing and consented to by the Security Agent, the Owner Manager and each
other party hereto except that such consent of the Security Agent will be
required only if such amendment, modification or waiver increases the
obligations of the Security Agent hereunder or adversely affects the rights of
the Security Agent hereunder.
(b) No failure or delay in exercising any power or right
under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power or right preclude any other or further
exercise thereof or the exercise of any other power or right. No notice to or
demand on any party in any case shall entitle it to any notice or demand in
similar or other circumstances. No waiver or approval under this Agreement
shall, except as may be otherwise stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval hereunder shall
require any similar or dissimilar waiver or approval thereafter to be granted
hereunder.
Section 11.2 NOTICES. All notices and other communications
provided to any party hereto under this Agreement shall be in writing or by
facsimile and addressed, delivered or transmitted to such party at its address
or facsimile number set forth below or at such other address or facsimile number
as may be designated by such party in a written notice to the other parties:
Owner Lessor:
Homer City OL1 LLC
c/o Wells Fargo Bank Minnesota, N.A.
Corporate Trustee Services
MAC; N2691-090
213 Court Street
Middletown, CT 06457
WITH A COPY TO:
Wells Fargo Bank Northwest, N.A.
Corporate Trust Services
MAC; U1254-031
Salt Lake City, UT 84111
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Owner Participant:
General Electric Capital Corporation
120 Long Ridge Road
Stamford, CT 06927
Attention: Manager Energy Portfolio
Telephone: 203-354-4580
Facsimile: 203-357-4890
WITH A COPY TO:
Amy Fisher, Esq.
General Electric Capital Corporation
120 Long Ridge Road
Stamford, CT 06927
Security Agent:
The Bank of New York
C/o United States Trust Company of New York
114 West 47th Street, 25th Floor
New York, New York 10036
Attention: Corporate Trust Administration
Facsimile: 212-852-1625
Homer City:
18101 Von Karman Avenue
Suite 1700
Irvine, CA 92612-1046
Attention: Treasurer
Facsimile: 949-752-5624
Any notice, if mailed and properly addressed with postage prepaid shall be
effective five (5) Business Days after being sent or if properly addressed and
sent by pre-paid courier service, shall be deemed given when received; any
notice, if transmitted by facsimile, shall be deemed given when transmitted (if
confirmed).
Section 11.3 SEVERABILITY. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability
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without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
Section 11.4 HEADINGS. The various headings of this Agreement
are inserted for convenience only and shall not affect the meaning or
interpretation of this Agreement or any provisions hereof or thereof.
Section 11.5 EXECUTION IN COUNTERPARTS, EFFECTIVENESS. This
Agreement may be executed by the parties hereto in several counterparts, each of
which shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.
Section 11.6 GOVERNING LAW; ENTIRE AGREEMENT. THIS AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK. This Agreement constitutes the entire understanding among the
parties hereto with respect to the subject matter hereof and supersede any prior
agreements, written or oral, with respect thereto.
Section 11.7 SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
Section 11.8 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO SHALL BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. EACH PARTY HERETO
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE
AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION. EACH PARTY HERETO FURTHER IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY
EXPRESSLY AND IRREVOCABLY
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WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE
OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY PARTY HERETO HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, SUCH PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS AGREEMENT.
Section 11.9 WAIVER OF JURY TRIAL. EACH PARTY HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY
HERETO. EACH PARTY ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE OTHER PARTIES ENTERING INTO THIS AGREEMENT.
Section 11.10 LIMITATIONS OF LIABILITY OF THE INDEPENDENT
MANAGER. It is expressly understood and agreed by the parties hereto that this
Agreement is executed by Wells Fargo, not individually or personally, but solely
as Independent Manager under the Lessor LLC Agreement in the exercise of the
power and authority conferred and vested in it as such Independent Manager, that
each and all of the representations, undertakings and agreements herein made on
the part of the Independent Manager or the Owner Lessor are intended not as
personal representations, undertakings and agreements by Wells Fargo, or for the
purpose or with the intention of binding Wells Fargo, personally, but are made
and intended for the purpose of binding only the Lease Indenture Estate, that
nothing herein contained shall be construed as creating any liability of Wells
Fargo, or any incorporator or any past, present or future subscriber to the
capital stock of, or stockholder, officer or director of Wells Fargo y, to
perform any covenant either express or implied contained herein or in the other
Operative Documents to which the Independent Manager or the Owner Lessor is a
party, and that so far as Wells Fargo is concerned, any Person shall look solely
to the Lease Indenture Estate for the performance of any
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obligation hereunder or thereunder or under any of the instruments referred to
herein or therein; PROVIDED, that nothing contained in this SECTION shall be
construed to limit in scope or substance any general corporate liability of
Wells Fargo as expressly provided in the Lessor LLC Agreement or in the
Participation Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Subordination Agreement to be executed by their respective officers as of the
days and year first above written.
HOMER CITY OL1
By: Wells Fargo Bank Northwest, National
Association, not in its individual capacity but
solely as Owner Manager under the Lessor
LLC Agreement
By:
--------------------------
Name:
Title:
GE CAPITAL OWNER PARTICIPANT
By:
--------------------------
Name:
Title:
EME HOMER CITY GENERATION L.P.
By Its General Partner
MISSION ENERGY WESTSIDE, INC.
By:
--------------------------
Name:
Title:
THE BANK OF NEW YORK, AS SUCCESSOR
TO THE UNITED STATES TRUST COMPANY,
not in its individual capacity,
except to the extent provided
herein, but solely as
Security Agent under the Lease
Indenture
By:
----------------------------
Name: Christopher Grell
Title: Authorized Signer
Date: