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EXHIBIT 10.4
CONFORMED COPY
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GENERATING PLANT
AND GAS TURBINE
ASSET PURCHASE AND SALE AGREEMENT
FOR
ASTORIA GENERATING PLANTS
LOCATED AT ASTORIA, QUEENS COUNTY, NEW YORK,
GOWANUS GAS TURBINES
LOCATED AT BROOKLYN, KINGS COUNTY, NEW YORK
AND
NARROWS GAS TURBINES
LOCATED AT BROOKLYN, KINGS COUNTY, NEW YORK
By and Between
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
and
ASTORIA GENERATING COMPANY, L.P.
Dated as of March 2, 1999
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ARTICLE I
Definitions
SECTION 1.01. Definitions .................................................. 1
SECTION 1.02. Accounting Terms ............................................. 14
ARTICLE II
Purchase and Sale: Assumption of
Certain Liabilities
SECTION 2.01. Purchase and Sale ............................................ 15
SECTION 2.02. Auctioned Assets and Retained Assets ......................... 15
SECTION 2.03. Assumed Obligations and Retained
Liabilities ................................................ 19
SECTION 2.04. Third Party Consents ......................................... 24
SECTION 2.05. Franchise Property ........................................... 25
ARTICLE III
Purchase Price
SECTION 3.01. Purchase Price ............................................... 26
SECTION 3.02. Post-Closing Adjustment ...................................... 26
SECTION 3.03. Allocation of Purchase Price ................................. 27
ARTICLE IV
The Closing
SECTION 4.01. Time and Place of Closing .................................... 29
SECTION 4.02. Payment of Purchase Price and Estimated
Adjustment Amount .......................................... 29
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ARTICLE V
Representations and Warranties of Seller
SECTION 5.01. Organization; Qualification .................................. 29
SECTION 5.02. Authority Relative to This Agreement ......................... 29
SECTION 5.03. Consents and Approvals; No Violation ......................... 30
SECTION 5.04. Year 2000 .................................................... 31
SECTION 5.05. Personal Property ............................................ 31
SECTION 5.06. Real Estate .................................................. 31
SECTION 5.07. Leases ....................................................... 32
SECTION 5.08. Certain Contracts and Arrangements ........................... 32
SECTION 5.09. Legal Proceedings ............................................ 32
SECTION 5.10. Permits; Compliance with Law ................................. 33
SECTION 5.11. Environmental Matters ........................................ 33
SECTION 5.12. Labor Matters ................................................ 34
SECTION 5.13. ERISA; Benefit Plans ......................................... 35
SECTION 5.14. Taxes ........................................................ 36
SECTION 5.15. Independent Engineering Assessments .......................... 36
SECTION 5.16. Undisclosed Liabilities ...................................... 37
SECTION 5.17. Brokers ...................................................... 37
SECTION 5.18. Insurance .................................................... 37
ARTICLE VI
Representations and Warranties of Buyer
SECTION 6.01. Organization ................................................. 38
SECTION 6.02. Authority Relative to This Agreement ......................... 38
SECTION 6.03. Consents and Approvals; No Violation ......................... 38
SECTION 6.04. Availability of Funds ........................................ 40
SECTION 6.05. Brokers ...................................................... 40
ARTICLE VII
Covenants of the Parties
SECTION 7.01. Conduct of Business Relating to the Auctioned Assets ......... 40
SECTION 7.02. Access to Information ........................................ 43
SECTION 7.03. Consents and Approvals; Transferable Permits ................. 45
SECTION 7.04. Further Assurances ........................................... 46
SECTION 7.05. Public Statements ............................................ 48
SECTION 7.06. Tax Matters .................................................. 48
SECTION 7.07. Bulk Sales or Transfer Laws .................................. 49
SECTION 7.08. Storage ...................................................... 49
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SECTION 7.09. Information Resources ........................................ 50
SECTION 7.10. Witness Services ............................................. 50
SECTION 7.11. Consent Orders ............................................... 50
SECTION 7.12. Nitrogen Oxide Allowances .................................... 51
SECTION 7.13. Trade Names .................................................. 51
SECTION 7.14. NYPA Agreements .............................................. 51
SECTION 7.15. Narrows ...................................................... 51
ARTICLE VIII
Conditions
SECTION 8.01. Conditions Precedent to Each Party's Obligation To
Effect the Purchase and Sale ............................... 52
SECTION 8.02. Conditions Precedent to Obligation of Buyer To
Effect the Purchase and Sale ............................... 53
SECTION 8.03. Conditions Precedent to Obligation of Seller To
Effect the Purchase and Sale ............................... 55
ARTICLE IX
Employee Matters
SECTION 9.01. Employee Matters ............................................. 56
SECTION 9.02. Continuation of Equivalent Benefit Plans/Credited Service .... 58
SECTION 9.03. Pension Plan ................................................. 59
SECTION 9.04. 401(k) Plan .................................................. 61
SECTION 9.05. Welfare Plans ................................................ 61
SECTION 9.06. Short- and Long-Term Disability .............................. 63
SECTION 9.07. Life Insurance and Accidental Death and Dismemberment
Insurance .................................................. 63
SECTION 9.08. Severance .................................................... 63
SECTION 9.09. Workers Compensation ......................................... 65
ARTICLE X
Indemnification and Dispute Resolution
SECTION 10.01. Indemnification ............................................. 65
SECTION 10.02. Third Party Claims Procedures ............................... 68
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ARTICLE XI
Termination
SECTION 11.01. Termination ................................................. 69
ARTICLE XII
Miscellaneous Provisions
SECTION 12.01. Expenses .................................................... 69
SECTION 12.02. Amendment and Modification; Extension; Waiver ............... 70
SECTION 12.03. No Survival of Representations or Warranties ................ 70
SECTION 12.04. Notices ..................................................... 70
SECTION 12.05. Assignment; No Third Party Beneficiaries .................... 71
SECTION 12.06. Governing Law ............................................... 72
SECTION 12.07. Counterparts ................................................ 72
SECTION 12.08. Interpretation .............................................. 72
SECTION 12.09. Jurisdiction and Enforcement ................................ 73
SECTION 12.10. Entire Agreement ............................................ 74
SECTION 12.11. Severability ................................................ 74
SECTION 12.12. Conflicts ................................................... 75
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SCHEDULES AND EXHIBITS
Schedule 2.02(a)(ii) Spare Parts
Schedule 2.02(a)(iii)(A) Buyer Personal Property Located on
Buyer Real Estate
Schedule 2.02(a)(iii)(B) Buyer Personal Property Located on
Seller Real Estate
Schedule 2.02(a)(iii)(C) Buyer Personal Property Located on
NYPA Real Estate
Schedule 2.02(a)(iii)(D) NYPA Personal Property
Schedule 2.02(a)(iv) Assigned Contracts
Schedule 2.02(a)(v) Transferable Permits
Schedule 2.02(a)(vi) SO2 Allowances
Schedule 2.02(b)(ii)(A) Seller Personal Property Located on
Buyer Real Estate
Schedule 2.02(b)(ii)(C) Communications Equipment
Schedule 2.03(a)(iv) Seller Consent Orders
Schedule 2.03(a)(xii) Assumed Seller Obligations under
NYPA Agreements
Schedule 2.05(a) Franchise Property
Schedule 5.03(a) Contracts Requiring Third Party
Consents
Schedule 5.08(a) Material Contracts
Schedule 5.09 Legal Proceedings
Schedule 5.10(a)(i) Exceptions Under Permits
Schedule 5.10(a)(ii) Non-Environmental Violations
Schedule 5.10(b) Nontransferable Permits and
Environmental Permits
Schedule 5.11 Environmental Matters
Schedule 5.13 Benefit Plans
Schedule 5.15(a) Exceptions to Independent
Engineering Assessment
Schedule 5.15(b) Changes to Auctioned Assets
Schedule 5.16 Other Undisclosed Liabilities
Schedule 7.14 Rights and Interests under NYPA
Agreements
Schedule 7.15 Narrows
Schedule 9.01(a) Job Titles
Schedule 9.01(b) Collective Bargaining Agreements
Exhibit A-1 Form of Astoria Zoning Lot
Development Agreement between
Seller and Arthur Kill Acquiror
Exhibit A-2 Form of Astoria Zoning Lot
Development Agreement between
Seller and Buyer
Exhibit A-3 Form of Gowanus Zoning Lot
Development Agreement between
Seller and Buyer
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Exhibit B-1 Form of Deed of Conveyance for Queens County
Exhibit B-2 Form of Deed of Conveyance for Kings County
Exhibit C Form of FIRPTA Affidavit
Exhibit D Form of Opinion of John D. McMahon,
Esq., General Counsel of Seller
Exhibit E Form of Opinion of Counsel to Buyer
Exhibit F Summary of Terms and Conditions for
License for A-10 Dock between
Seller and Buyer
Exhibit G Form of Transition Capacity
Agreement between Seller and Buyer
Exhibit H Summary of Terms and Conditions for
License for A-0 Dock between Seller
and Buyer
Exhibit I Form of Astoria Declaration of
Subdivision Easements
Exhibit J Form of Gowanus Declaration of
Subdivision Easements
Exhibit K Form of Guarantee Agreement
Exhibit L Form of Opinion of Counsel to
Guarantor
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GENERATING PLANT AND GAS TURBINE ASSET PURCHASE
AND SALE AGREEMENT (including the Schedules hereto, this
"Agreement"), dated as of March 2, 1999, by and between
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC., a New
York corporation ("Seller"), and ASTORIA GENERATING
COMPANY, L.P., a Delaware limited partnership ("Buyer",
collectively with Seller, the "Parties").
WHEREAS Seller has offered the Auctioned Assets (as defined herein)
for sale at auction pursuant to the Order Authorizing the Process for Auctioning
of Generation Plant issued by the PSC (as defined herein) and effective as of
July 21, 1998; and
WHEREAS Buyer desires to purchase, and Seller desires to sell, the
Auctioned Assets upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements hereinafter set forth, and intending
to be legally bound hereby, the Parties agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. (a) As used in this Agreement, the
following terms have the following meanings:
"A-0 License" means the license from Buyer to Seller in respect of
the A-0 dock at Astoria, the material terms of which shall be substantially as
set forth in Exhibit H.
"A-10 License" means the license from Seller to Buyer in respect of
the A-10 dock at Astoria, the material terms of which shall be substantially as
set forth in Exhibit F.
"Accountants" shall have the meaning set forth in Section 3.02(b).
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"Adjustment Amount" shall have the meaning set forth in Section
3.02(a).
"Adjustment Date" shall have the meaning set forth in Section
3.02(c).
"Adjustment Statement" shall have the meaning set forth in Section
3.02(a).
"Affected Employees" shall have the meaning set forth in Section
9.01(a).
"Affected Union Employees" shall have the meaning set forth in
Section 9.01(b).
"Affiliate" shall have the meaning set forth in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended.
"Agreement" shall have the meaning set forth in the Preamble.
"Allocation" shall have the meaning set forth in Section 3.03.
"Ancillary Agreements" means the Continuing Site Agreements, the
Declaration of Easements Agreements, the Declarations of Subdivision Easements,
the Zoning Lot Development Agreements, the Transition Capacity Agreement, the
deeds contemplated by Section 8.02(e)(i) and any other agreement to which Buyer
and Seller are party and which is expressly identified by its terms as an
Ancillary Agreement hereunder.
"Applicable Law" shall have the meaning set forth in Section 3.03.
"Arthur Kill Acquiror" means the person referred to as "Buyer" in
the Generating Plant and Gas Turbine Asset Purchase and Sale Agreement for
Arthur Kill Generating Plants and Astoria Gas Turbines between Seller and such
person.
"Assumed Consent Order Obligations" shall have the meaning set forth
in Section 2.03(a)(iv).
"Assumed Obligations" shall have the meaning set forth in Section
2.03(a).
"Assumed Seller Obligations Under NYPA Agreements" shall have the
meaning set forth in Section 2.03(a)(xii).
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"Astoria Continuing Site Agreement" means the Astoria Continuing
Site Agreement dated as of even date herewith between Seller and Buyer.
"Astoria Declaration of Easements" means the Astoria Declaration of
Easements by Seller dated as of January 27, 1999, as amended.
"Astoria Declaration of Subdivision Easements" means the Astoria
Declaration of Subdivision Easements to be made by Seller substantially in the
form of Exhibit I, except for changes required by any Governmental Authority to
the extent that no such change materially and adversely impairs the continued
use and operation of the Auctioned Assets as currently conducted.
"Astoria Zoning Lot Development Agreement" means (a) the Astoria
Zoning Lot Development Agreement between Seller and Arthur Kill Acquiror, in the
form of Exhibit A-1, if executed and delivered prior to the Closing Date or (b)
the Astoria Zoning Lot Development Agreement between Seller and Buyer, in the
form of Exhibit A-2.
"Auctioned Assets" shall have the meaning set forth in Section
2.02(a).
"Benefit Plans" shall have the meaning set forth in Section 5.13.
"Bidder Confidentiality Agreements" shall have the meaning set forth
in Section 7.02(b).
"Business Day" means any day other than Saturday, Sunday and any day
which is a legal holiday or a day on which banking institutions in New York are
authorized or required by law or other action of a Governmental Authority to
close.
"Buyer" shall have the meaning set forth in the Preamble.
"Buyer Assets" shall have the meaning set forth in Section 2.03(a)
(x).
"Buyer Benefit Plans" shall have the meaning set forth in Section
9.02(c).
"Buyer Facilities" shall mean the "Parcel B Facilities" and "Parcel
D Facilities" under the Astoria Declaration of Easements, together with the
respective
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"Buyer Facilities" under each of the Gowanus and Narrows Declaration of
Easements Agreements.
"Buyer Indemnitees" shall have the meaning set forth in Section
10.01(a).
"Buyer Material Adverse Effect" shall have the meaning set forth in
Section 6.03(a).
"Buyer Real Estate" shall have the meaning set forth in Section
2.02(a)(i).
"Buyer Required Regulatory Approvals" shall have the meaning set
forth in Section 6.03(b).
"Buyer's 401(k) Plans" shall have the meaning set forth in Section
9.04(a).
"Buyer's Pension Plans" shall have the meaning set forth in Section
9.03(a).
"Buyer's Welfare Plans" shall have the meaning set forth in Section
9.05(a).
"Closing" shall have the meaning set forth in Section 4.01.
"Closing Date" shall have the meaning set forth in Section 4.01.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collective Bargaining Agreement" shall have the meaning set forth
in Section 9.01(b).
"Communications Equipment" means the equipment, systems, switches
and lines used in connection with voice, data and other communications
activities.
"Confidentiality Agreement" means the Confidentiality Agreement
dated September 22, 1998 between Seller and Orion Power Holdings, Inc.
"Continued Employee" shall have the meaning set forth in Section
9.01(a).
"Continued Non-Union Employee" shall have the meaning set forth in
Section 9.02(a).
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"Continued Union Employee" shall have the meaning set forth in
Section 9.01(b).
"Continuing Site Agreements" means the Astoria Continuing Site
Agreement, the Gowanus Continuing Site Agreement and the Narrows Continuing Site
Agreement.
"Contracts" shall have the meaning set forth in Section 2.02(a)
(iv).
"Conveyance Plans" shall have the meaning set forth in Section
2.02(a)(i).
"Declaration of Easements Agreements" means the Astoria Declaration
of Easements, the Gowanus Declaration of Easements Agreement and Narrows
Declaration of Easements Agreement.
"Declarations of Subdivision Easements" means the Astoria
Declaration of Subdivision Easements and the Gowanus Declaration of Subdivision
Easements.
"Emission Reduction Credits" means credits, in units that are
established by the environmental regulatory agency with jurisdiction over the
source or facility that has obtained the credits, resulting from a reduction in
the emissions of air pollutants from an emitting source or facility (including,
and to the extent allowable under applicable law, reductions from retirements,
control of emissions beyond that required by applicable law and fuel switching),
that: (i) have been certified by NYSDEC as complying with the law and
regulations of the State of New York governing the establishment of such credits
(including that such emissions reductions are real, enforceable, permanent and
quantifiable); or (ii) have been certified by any other applicable regulatory
authority as complying with the law and regulations governing the establishment
of such credits (including that such emissions reductions are real, enforceable,
permanent and quantifiable). Emission Reduction Credits include certified air
emissions reductions, as described above, regardless of whether the regulatory
agency certifying such reductions designates such certified air emissions
reductions by a name other than "emissions reduction credits".
"Encumbrances" means any mortgages, pledges, liens, security
interests, conditional and installment sale agreements, activity and use
limitations, exceptions, conservation easements, rights-of-way, deed
restrictions, encumbrances and charges of any kind.
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"Environmental Laws" means all former, current and future Federal,
state, local and foreign laws (including common law), treaties, regulations,
rules, ordinances, codes, decrees, judgments, directives or orders (including
consent orders) and Environmental Permits, in each case, relating to pollution
or protection of the environment or natural resources, including laws relating
to Releases or threatened Releases, or otherwise relating to the generation,
manufacture, processing, distribution, use, treatment, storage, arrangement for
disposal, transport, recycling or handling, of Hazardous Substances.
"Environmental Liability" means all liabilities, obligations,
damages, losses, claims, actions, suits, judgments, orders, fines, penalties,
fees, expenses and costs, including: (i) remediation costs, engineering costs,
environmental consultant fees, laboratory fees, permitting fees, investigation
costs and defense costs and reasonable attorneys' fees and expenses; (ii) any
claims, demands and causes of action relating to or resulting from any personal
injury (including wrongful death), property damage (real or personal) or natural
resource damage; and (iii) any penalties, fines or costs associated with the
failure to comply with any Environmental Law.
"Environmental Permits" means the permits, licenses, consents,
approvals and other governmental authorizations with respect to Environmental
Laws relating primarily to the power generation operations of the Generating
Plants or the Gas Turbines.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall have the meaning set forth in Section 5.13.
"Estimated Adjustment Amount" shall have the meaning set forth in
Section 4.02.
"FERC" means the Federal Energy Regulatory Commission.
"Federal Power Act" shall have the meaning set forth in Section
5.03(b).
"Filed Seller SEC Documents" means the reports, schedules, forms,
statements and other documents filed by Seller with the Securities and Exchange
Commission since January 1, 1997, and publicly available prior to the date of
this Agreement.
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"Final Allocation" shall have the meaning set forth in Section 3.03.
"Franchise Property" shall have the meaning set forth in Section
2.05(a).
"GAAP" shall have the meaning set forth in Section 1.02.
"Gas Turbines" means the gas turbine units comprised of the Astoria
GT1, Gowanus GT1 through GT4 and Narrows GT1 and GT2.
"Generating Facilities" means the Generating Plants, the Gas
Turbines and any additional generating plants, gas turbines or other generating
facilities constructed by Buyer after the Closing Date at the site of any
Auctioned Assets.
"Generating Plants" means the two retired steam turbine generating
units designated as Astoria units 1 and 2 and the three operating steam turbine
generating units designated as Astoria units 3, 4 and 5.
"Governmental Authority" means any court, administrative or
regulatory agency or commission or other governmental entity or instrumentality,
domestic, foreign or supranational or any department thereof.
"Gowanus Continuing Site Agreement" means the Gowanus Continuing
Site Agreement dated as of even date herewith between Seller and Buyer.
"Gowanus Declaration of Easements Agreement" means the Gowanus
Declaration of Easements Agreement dated as of even date herewith between Seller
and Buyer.
"Gowanus Declaration of Subdivision Easements" means the Gowanus
Declaration of Subdivision Easements to be made by Seller substantially in the
form of Exhibit J, except for changes required by any Governmental Authority to
the extent that no such change materially and adversely impairs the continued
use and operation of the Auctioned Assets as currently conducted.
"Gowanus Zoning Lot Development Agreement" means the Gowanus Zoning
Lot Development Agreement between Seller and Buyer in the form of Exhibit A-3.
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"Guarantee Agreement" means the Guarantee Agreement dated as of even
date herewith between Guarantor and Seller substantially in the form of Exhibit
K.
"Guarantor" means Orion Power Holdings, Inc.
"Hazardous Substances" means (i) any petrochemical or petroleum
products, crude oil or any fraction thereof, ash, radioactive materials, radon
gas, asbestos in any form, urea formaldehyde foam insulation or polychlorinated
biphenyls, (ii) any chemicals, materials, substances or wastes defined as or
included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," "restricted hazardous materials," "extremely hazardous
substances," "toxic substances," "contaminants" or "pollutants" or words of
similar meaning and regulatory effect contained in any Environmental Law or
(iii) any other chemical, material, substance or waste which is prohibited,
limited or regulated by any Environmental Law.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.
"Income Tax" means any Federal, state, local or foreign Tax or
surtax (i) based upon, measured by or calculated with respect to net income,
profits or receipts (including the New York State Gross Receipts Tax (including
the excess dividends tax), the New York City Public Utilities Excise Tax, any
and all municipal gross receipts Taxes, capital gains Taxes and minimum Taxes)
or (ii) based upon, measured by or calculated with respect to multiple bases
(including corporate franchise taxes) if one or more of the bases on which such
Tax may be based, measured by or calculated with respect to, is described in
clause (i), in each case, together with any interest, penalties, or additions to
such Tax.
"Indemnifiable Loss" shall have the meaning set forth in Section
10.01(a).
"Indemnifying Party" shall have the meaning set forth in Section
10.01(c).
"Indemnitee" shall have the meaning set forth in Section 10.01(c)
"Independent Engineering Assessments" shall have the meaning set
forth in Section 5.15.
"Interconnection Facilities" means those items of switching
equipment, switchyard controls, protective relays
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and related facilities of Seller that are used by Seller in connection with the
provision of Interconnection Services.
"Interconnection Services" means the service provided by Seller to
Buyer to interconnect the Generating Facilities to the Transmission System.
"Inventory Survey" shall have the meaning set forth in Section
3.02(a).
"ISO" means the New York Independent System Operator.
"Local 1-2" shall have the meaning set forth in Section 9.01(a).
"Local 1-2 Collective Bargaining Agreement" shall have the meaning
set forth in Section 9.01(a).
"Material Adverse Effect" means any change, or effect on the
Auctioned Assets, that is materially adverse to the business, operations or
condition (financial or otherwise) of the Auctioned Assets, taken as a whole,
other than (i) any change or effect resulting from changes in the international,
national, regional or local wholesale or retail energy, capacity or ancillary
services electric power markets, (ii) any change or effect resulting from
changes in the international, national, regional or local markets for fuel,
(iii) any change or effect resulting from changes in the national, regional or
local electric transmission systems, (iv) any change or effect resulting from
any bid cap, price limitation, market power mitigation measure, including the
Mitigation Measures, or other regulatory or legislative measure in respect of
transmission services or the wholesale or retail energy, capacity or ancillary
services markets adopted or approved (or failed to be adopted or approved) by
FERC, the PSC or any other Governmental Authority or proposed by any person, (v)
any change or effect resulting from any regulation, rule, procedure or order
adopted or proposed (or failed to be adopted or proposed) by or with respect to,
or related to, the ISO, (vi) any change or effect resulting from any action or
measure taken or adopted, or proposed to be taken or adopted, by any local,
state, regional, national or international reliability organization and (vii)
any materially adverse change in or effect on the Auctioned Assets which is
cured by Seller before the Closing Date.
"Mitigation Measures" shall have the meaning set forth in Section
6.03(b).
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"MMS" means the Material Management System, which is an information
resources system served by Seller's mainframe computer.
"Narrows Continuing Site Agreement" means the Narrows Continuing
Site Agreement dated as of even date herewith between Seller and Buyer.
"Narrows Declaration of Easements Agreement" means the Narrows
Declaration of Easements Agreement dated as of even date herewith between Seller
and Buyer.
"Narrows Turbines" shall have the meaning set forth in Section 7.15.
"NYPA" means the Power Authority of the State of New York.
"NYPA Agreements" means the Indenture, made as of December 13, 1974,
between Seller and NYPA, and the NYPA Operating Agreement.
"NYPA Operating Agreement" means the Astoria Operating Agreement
dated January 5, 1981, between NYPA and Seller, as amended.
"NYSDEC" means the New York State Department of Environmental
Conservation.
"Off-Site" means any location except (i) the Auctioned Assets and
(ii) any location to or under which Hazardous Substances present or Released at
the Auctioned Assets have migrated.
"Offering Memorandum" means the Offering Memorandum dated August
1998 describing the Generating Plants and the Gas Turbines, and the materials
delivered with such Offering Memorandum, as such Offering Memorandum and such
materials may have been amended or supplemented.
"Operating Records" shall have the meaning set forth in Section
2.02(a)(viii).
"Party" shall have the meaning set forth in the Preamble.
"Permits" means the permits, licenses, consents, approvals and other
governmental authorizations (other than with respect to Environmental Laws)
relating primarily to the power generation operations of the Generating Plants
or the Gas Turbines.
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"Permitted Exceptions" means (i) all exceptions, restrictions,
easements, charges, rights-of-way and monetary and nonmonetary encumbrances
which are set forth in any Permits or Environmental Permits, (ii) statutory
liens for current taxes or assessments not yet due or delinquent or the validity
of which is being contested in good faith by appropriate proceedings, (iii)
mechanics', carriers', workers', repairers' and other similar liens arising or
incurred in the ordinary course of business relating to obligations as to which
there is no default on the part of Seller or the validity of which are being
contested in good faith by appropriate proceedings, (iv) zoning, entitlement,
conservation restriction and other land use and environmental regulations by
Governmental Authorities (v) such title matters set forth in the Certificate of
Title No. NY981606, as amended, the Certificate of Title No. NY971417, as
amended, and the Certificate of Title No. NY971418, as amended, in each case,
issued by the Title Company, (vi) all matters disclosed on the Conveyance Plans
and any other facts that would be disclosed by an accurate survey and physical
inspection of the Buyer Real Estate, (vii) Encumbrances, easements, obligations
or other restrictions created pursuant to or provided for in any Ancillary
Agreement or any NYPA Agreement, (viii) restrictions and regulations imposed by
the ISO, any Governmental Authority or any local, state, regional, national or
international reliability council and (ix) such other Encumbrances or
imperfections in or failure of title which would not, individually or in the
aggregate, reasonably be expected to materially impair the continued use and
operation of the Auctioned Assets as currently conducted.
"person" means any individual, partnership, limited liability
company, joint venture, corporation, trust, unincorporated organization or
Governmental Authority.
"PPMIS" means the Power Plant Maintenance Information System, which
is an information resources system served by Seller's mainframe computer.
"Prorated Items" shall have the meaning set forth in Section 2.03(a)
(viii).
"Protective Relaying System" means the system relating to the
Generating Facilities comprised of components collectively used to detect
defective power system elements or other conditions of an abnormal nature,
initiate appropriate control circuit action in response
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thereto and isolate the appropriate system elements in order to minimize damage
to equipment and interruption to service.
"PSC" means the New York State Public Service Commission.
"Purchase Price" shall have the meaning set forth in Section 3.01.
"Release" means any release, spill, emission, leaking, dumping,
injection, pouring, deposit, disposal, discharge, dispersal, leaching or
migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.
"Restraints" shall have the meaning set forth in Section 8.01(b).
"Retained Assets" shall have the meaning set forth in Section
2.02(b).
"Retained Liabilities" shall have the meaning set forth in Section
2.03(b).
"Revenue Meters" means all meters measuring demand, energy and
reactive components, and all pulse isolation relays, pulse conversion relays and
associated totalizing and remote access pulse recorder equipment, in each case,
required to measure the transfer of energy between the Parties.
"Revocable Consent" shall have the meaning set forth in Section
2.05(a).
"Segregated Reimbursement Accounts" shall have the meaning set forth
in Section 9.05(b).
"Seller" shall have the meaning set forth in the Preamble.
"Seller Assets" shall have the meaning set forth in Section
2.03(b)(x).
"Seller Consent Orders" shall have the meaning set forth in Section
2.03(a)(iv).
"Seller Facilities" shall mean the "Parcel A Facilities" under the
Astoria Declaration of Easements, together with the respective "Seller
Facilities" under each
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of the Gowanus and Narrows Declaration of Easements Agreements.
"Seller Indemnitees" shall have the meaning set forth in Section
10.01(b).
"Seller Real Estate" means all real property and leaseholds or other
interests in real property of Seller (including the premises on which the
Substations are located), other than Buyer Real Estate.
"Seller Required Regulatory Approvals" shall have the meaning set
forth in Section 5.03(b).
"Seller's 401(k) Plans" shall have the meaning set forth in Section
9.04(a).
"Seller's Pension Plans" shall have the meaning set forth in Section
9.03(a).
"Seller's Reimbursement Account Plans" shall have the meaning set
forth in Section 9.05(b).
"SO2 Allowances" means allowances that have been allocated to Seller
for the Generating Plants or the Gas Turbines by the Administrator of the United
States Environmental Protection Agency under Title IV of the Clean Air Act
authorizing the emission of one ton of sulfur dioxide per allowance during or
after the year 2000.
"Substations" shall have the meaning set forth in Section
2.02(b)(i).
"Tax Benefit" means, with respect to any Indemnifiable Loss for any
person, the positive excess, if any, of the Tax liability of such person without
regard to such Indemnifiable Loss over the Tax liability of such person taking
into account such Indemnifiable Loss, with all other circumstances remaining
unchanged.
"Tax Cost" means, with respect to any indemnity payment for any
person, the positive excess, if any, of the Tax liability of such person taking
such indemnity payment into account over the Tax liability of such person
without regard to such payment, with all other circumstances remaining
unchanged.
"Tax Return" means any return, report, information return or other
document (including any related or supporting information) required to be
supplied to any authority with respect to Taxes.
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"Taxes" means all taxes, surtaxes, charges, fees, levies, penalties
or other assessments imposed by any United States Federal, state or local or
foreign taxing authority, including Income Tax, excise, property, sales,
transfer, franchise, special franchise, payroll, recording, withholding, social
security or other taxes, or any liability for taxes incurred by reason of
joining in the filing of any consolidated, combined or unitary Tax Returns, in
each case including any interest, penalties or additions attributable thereto;
provided, however, that "Taxes" shall not include sewer rents or charges for
water.
"Termination Date" shall have the meaning set forth in Section
11.01(b).
"Third Party Claim" shall have the meaning set forth in Section
10.02(a).
"Title Company" means Commonwealth Land Title Insurance Company or
any other reputable title insurance company licensed to do business in New York.
"Transferable Permits" shall have the meaning set forth in Section
2.02(a)(v).
"Transferring Employee Records" shall have the meaning set forth in
Section 2.02(a)(viii).
"Transferring Employees" shall have the meaning set forth in Section
2.02(a)(viii).
"Transition Capacity Agreement" means the Transition Capacity
Agreement to be entered into between Seller and Buyer substantially in the form
of Exhibit G.
"Transmission System" shall have the meaning set forth in Section
2.02(b)(i)
"Zoning Lot Development Agreements" means the Astoria Zoning Lot
Development Agreement and the Gowanus Zoning Lot Development Agreement.
SECTION 1.02. Accounting Terms. Any accounting terms used in this
Agreement or the Ancillary Agreements shall, unless otherwise specifically
provided, have the meanings customarily given them in accordance with United
States generally accepted accounting principles ("GAAP") and all financial
computations hereunder or thereunder shall, unless otherwise specifically
provided, be computed in accordance with GAAP consistently applied.
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ARTICLE II
Purchase and Sale; Assumption of Certain Liabilities
SECTION 2.01. Purchase and Sale. Upon the terms and subject to the
satisfaction of the conditions contained in this Agreement, at the Closing,
Seller agrees to sell, assign, convey, transfer and deliver to Buyer, and Buyer
agrees to purchase, assume and acquire from Seller all the Auctioned Assets. In
the case of any Auctioned Assets not located at the Generating Plants or Gas
Turbines (including supplies, materials and spare parts inventory), Buyer agrees
that (i) from and after the Closing, except to the extent specifically otherwise
provided in the Ancillary Agreements, Buyer will bear all risk of casualty or
loss with regard to such Auctioned Assets (regardless of whether they remain on
Seller's property or otherwise in Seller's possession) and (ii) Seller shall
store such Auctioned Assets in accordance with Section 7.08.
SECTION 2.02. Auctioned Assets and Retained Assets. (a) Auctioned
Assets. The term "Auctioned Assets" means all the assets, real and personal
property, goodwill and rights of Seller of whatever kind and nature, whether
tangible or intangible, in each case, primarily relating to the power generation
operations of the Generating Plants or the Gas Turbines, other than the Retained
Assets, including:
(i) subject to Section 2.05, all real property and leaseholds or
other interests in real property of Seller relating primarily to the power
generation operations of the Generating Plants or the Gas Turbines
described as (A) Parcels B and D as shown on the Astoria Generating
Station ALTA/ACSM Land Title Survey dated February 17, 1999, (B) Parcel A
as shown on the Gowanus Gas Turbine Site ALTA/ACSM Land Title Survey
Conveyance Plan dated February 23, 1999 and (C) the Narrows Gas Turbine
Site as shown on the Narrows Gas Turbine Site ALTA/ACSM Land Title Survey
Conveyance Plan dated February 23, 1999, in each case, as may hereafter be
amended in immaterial respects (collectively, the "Conveyance Plans"),
together with all buildings, improvements, structures and fixtures
thereon, subject to Permitted Exceptions or Encumbrances otherwise
disclosed to Buyer in this Agreement or the Ancillary Agreements with
respect thereto (the "Buyer Real Estate");
(ii) subject to Section 2.04 and Section 2.05, all inventories of
fuels, supplies, materials and spare parts relating primarily to the power
generation
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operations of the Generating Plants or the Gas Turbines, together with and
subject to (A) all Permitted Exceptions or Encumbrances otherwise
disclosed to Buyer in this Agreement or the Ancillary Agreements with
respect thereto and (B) all warranties against manufacturers and vendors
relating thereto, including the spare parts listed on Schedule 2.02(a)
(ii), in each case, other than assets that become obsolete or that are
used, consumed, replaced or disposed in the ordinary course of business
consistent with past practice or as permitted by this Agreement;
(iii) subject to Section 2.04 and Section 2.05, (A) the machinery,
equipment, facilities, furniture and other personal property (other than
vehicles) relating primarily to the power generation operations of the
Generating Plants or the Gas Turbines, including a stand-alone local area
network and other items of personal property located on Buyer Real Estate
or temporarily removed from Buyer Real Estate for repairs, servicing or
maintenance and listed on Schedule 2.02(a)(iii)(A), (B) machinery,
equipment, facilities, furniture and other personal property located on
Seller Real Estate or temporarily removed from Seller Real Estate for
repairs, servicing or maintenance and listed on Schedule 2.02(a)(iii)
(B), (C) machinery, equipment, facilities, furniture and other personal
property located on real property owned by NYPA or temporarily removed
from such real property for repairs, servicing or maintenance and listed
on Schedule 2.02(a)(iii)(C) and (D) machinery, equipment, facilities,
furniture and other personal property listed on Schedule 2.02(a)(iii)(D)
to the extent Seller has obtained title thereto from NYPA prior to
Closing, in each case, (1) together with and subject to (x) all Permitted
Exceptions or Encumbrances otherwise disclosed to Buyer in this Agreement
or the Ancillary Agreements with respect thereto and (y) all warranties
against manufacturers or vendors relating thereto and (2) other than
assets that become obsolete or that are used, consumed, replaced or
disposed in the ordinary course of business consistent with past practice
or as permitted by this Agreement;
(iv) subject to Section 2.04, all right, title and interest of
Seller in, to and under all contracts, agreements, personal property
leases (whether Seller is lessor or lessee thereunder), commitments and
all other legally binding arrangements (other than Seller Consent Orders),
whether oral or written (A) set forth on
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Schedule 2.02(a)(iv) or (B) otherwise relating primarily to the power
generation operations of the Generating Plants or the Gas Turbines and
entered into by Seller in accordance with Section 7.01 (the "Contracts"),
in each case, to the extent in full force and effect on the Closing Date;
(v) subject to Section 7.03(c), the Permits and Environmental
Permits that are transferred or transferable by Seller to Buyer
(collectively, the "Transferable Permits"), including the Transferable
Permits set forth on Schedule 2.02(a)(v), in each case, to the extent in
full force and effect on the Closing Date;
(vi) the SO2 Allowances listed on Schedule 2.02(a)(vi);
(vii) all nitrogen oxide allowances allocated to the Generating
Plants or the Gas Turbines by NYSDEC under the New York State Nitrogen
Oxides Budget Program that have not been used on or prior to the Closing
Date (it being understood that, for purposes of this Agreement, one
nitrogen oxide allowance shall be deemed "used" for each ton of actual
nitrogen oxide emitted from the Generating Plants or Gas Turbines between
May 1 of any year and September 30 of such year, inclusive);
(viii)(A) all data, information, books, operating records,
operating, safety and maintenance manuals, engineering design plans,
blueprints and as-built plans, specifications, procedures, facility
compliance plans, environmental procedures and similar records of Seller
relating primarily to the power generation operations of the Generating
Plants or the Gas Turbines, to the extent in Seller's possession or
readily available (collectively, "Operating Records"), and (B) all
personnel files relating to employees of Seller to be employed by Buyer
after the Closing Date in accordance with Article IX (the "Transferring
Employees"), to the extent in Seller's possession and readily available
and to the extent such files pertain to (1) skill and development training
and resumes, (2) seniority histories, (3) salary and benefit information,
(4) Occupational Safety and Health Act medical reports, (5) active medical
restriction forms and (6) any other matters, disclosure of which by Seller
to Buyer is permitted under applicable law without the consent of the
Transferring Employee, but not including any performance evaluations or
disciplinary records (collectively, the "Transferring
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Employee Records"); provided, however, that Seller shall be permitted to
retain copies, or originals to the extent it provides Buyer with copies of
same, of all Operating Records and Transferring Employee Records; and
(ix)(A) except as provided in Section 2.02(b)(iv), the software
relating primarily to the power generation operations of the Generating
Plants or the Gas Turbines (provided, however, that Buyer acknowledges
that it will require licenses from third parties in order to be legally
entitled to use such software), and (B) a non-exclusive, royalty-free
license to use solely in connection with the Auctioned Assets the software
or other copyrighted material owned by Seller located at Buyer Real
Estate.
(b) Retained Assets. The term "Retained Assets" means:
(i) the transmission and distribution facilities owned, controlled
or operated by Seller for purposes of providing point-to-point
transmission service, network integration service and distribution service
and other related purposes, including the real property and equipment
located at the Astoria East Substation, the Astoria West Substation, the
North Queens Substation, the Gowanus Substation and the Greenwood
Substation (collectively, the "Substations"), used in controlling
continuity between the Generating Plants and Gas Turbines and the
transmission and distribution facilities and for other purposes (the
"Transmission System");
(ii)(A) except as set forth in Section 2.02(a)(iii), all
Interconnection Facilities and other transmission, distribution and
substation machinery, equipment and facilities and related support
equipment located on Buyer Real Estate or Seller Real Estate or
temporarily removed from Buyer Real Estate or Seller Real Estate for
repairs, servicing or maintenance, including items listed on Schedule
2.02(b)(ii)(A); (B) all Revenue Meters installed by Seller; (C)
Communications Equipment and related support equipment (1) located on
Buyer Real Estate or temporarily removed from Buyer Real Estate for
repairs, servicing or maintenance and listed on Schedule 2.02(b)(ii)(C)
or acquired by Seller after the date of this Agreement and designated by
Seller as a Retained Asset or (2) located on Seller Real Estate or
temporarily removed from Seller Real Estate for
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repairs, servicing or maintenance; and (D) all Protective Relaying Systems
not located on Buyer Real Estate;
(iii) all cash, cash equivalents, bank deposits and accounts
receivable held or owned by Seller;
(iv)(A) all mainframe computer systems of Seller, (B) the code to
all software described in Section 2.02(a)(ix)(B), and (C) all software,
copyrights, know-how or other proprietary information relating primarily
to any other Retained Assets or any Retained Liabilities, including
software, copyrights, know-how or other proprietary information licensed
to Buyer pursuant to Section 2.02 (a)(ix)(B);
(v) the names "Consolidated Edison", "Con Edison", "Con Ed",
"Consolidated Edison Company", "Consolidated Edison Company of New York,
Inc.", "Consolidated Edison, Inc.", "New York Edison", "Brooklyn Edison",
"Staten Island Edison" and "Edison" and any related or similar trade
names, trademarks, service marks or logos (and any rights to and in the
same, including any right to use the same);
(vi) subject to Section 7.06(d), any refund or credit related to
Taxes or sewer rents or water charges or any other liabilities or
obligations in respect of the Auctioned Assets, in each case, attributable
to periods (or portions thereof) prior to the Closing Date;
(vii) all personnel records (other than Transferring Employee
Records) and all other records (other than Operating Records);
(viii)(A) all Emission Reduction Credits held or possessed by
Seller and (B) SO2 Allowances held or possessed by Seller and not listed
on Schedule 2.02(a)(vi); and
(ix) any other asset that is not described with particularity in
this Agreement as an Auctioned Asset.
SECTION 2.03. Assumed Obligations and Retained Liabilities. (a)
Assumed Obligations. At the Closing, Buyer shall assume, and from and after the
Closing, shall discharge, all of the liabilities and obligations, direct or
indirect, known or unknown, absolute or contingent, which relate to the
Auctioned Assets or are otherwise specified
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below, other than the Retained Liabilities (collectively, the "Assumed
Obligations"), including:
(i) except as set forth in Section 2.03(b)(ii), any liabilities and
obligations under the Contracts;
(ii) any liabilities and obligations for goods delivered or services
rendered on or after the Closing Date relating to the Auctioned Assets;
(iii) except as set forth in Sections 2.03(b)(iii) or (iv), any
Environmental Liability arising out of or in connection with (A) any
violation or alleged violation of, or noncompliance or alleged
noncompliance with, any Environmental Laws, prior to, on or after the
Closing Date, with respect to the ownership or operation of the Auctioned
Assets, notwithstanding that, as contemplated by Section 7.03(c), Seller
may remain the "holder of record" with respect to certain Transferable
Permits, (B) the condition of any Auctioned Assets prior to, on or after
the Closing Date, including any actual or alleged presence, Release or
threatened Release of any Hazardous Substance at, on, in, under or
migrating onto or from, the Auctioned Assets, prior to, on or after the
Closing Date (except for any such Release from equipment or property owned
or operated by Seller and located on, or constituting, Seller Real Estate
adjacent to Buyer Real Estate that (1) occurs on or after the Closing Date
and (2) is caused by Seller or its Affiliates), (C) any Release or
threatened Release of any Hazardous Substance on or after the Closing Date
from the Buyer Facilities or otherwise originating from, or relating to,
any equipment owned or used by Buyer that is located on Seller Real Estate
or (D) the transportation, storage, Release, threatened Release or
recycling of, or arrangement for such activities with respect to,
Hazardous Substances generated in respect of the Auctioned Assets at or to
any location, on or after the Closing Date;
(iv) any liabilities and obligations relating to the Auctioned
Assets under the consent orders listed on Schedule 2.03(a)(iv)(the
"Seller Consent Orders") and identified thereon as "Assumed Consent Order
Obligations" (the "Assumed Consent Order Obligations")
(v) except as set forth in Section 2.03(b)(iv), any liabilities and
obligations with respect to the Permits to the extent arising or accruing
on or after the Closing Date;
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(vi)(A) all wages, overtime, employment taxes, severance pay,
transition payments, workers compensation benefits, occupational safety
and health liabilities or other similar liabilities and obligations in
respect of Transferring Employees to the extent arising or accruing on or
after the Closing Date, and (B) all other liabilities and obligations with
respect to the Transferring Employees for which Buyer is responsible
pursuant to Article IX;
(vii)(A) any liabilities and obligations (other than any
Environmental Liabilities which are Retained Liabilities) in respect of
any personal injury or property damage claim relating to, resulting from
or arising out of the Generating Plants or Gas Turbines or (B) any
liabilities and obligations in respect of any discrimination, wrongful
discharge or unfair labor practice claim by any Transferring Employee, in
the case of each of the foregoing clauses (A) and (B), to the extent
arising or accruing on or after the Closing Date;
(viii) any liabilities and obligations, with respect to the periods
that include the Closing Date, with respect to real or personal property
rent, taxes based on the ownership or use of property, utilities charges
and similar charges that primarily relate to the Generating Plants or the
Gas Turbines (collectively, the "Prorated Items"), to the extent such
Prorated Items relate to the period from and after the Closing Date,
including (A) personal property taxes, real estate and occupancy taxes,
assessments and other charges (which shall be apportioned or adjusted as
provided in the Zoning Lot Development Agreements), (B) rent and all other
items payable by Seller under any Contract, (C) any fees with respect to
any Transferable Permit and (D) sewer rents and charges for water,
telephone, electricity and other utilities, in each case calculated by
multiplying the amount of any such Prorated Item by a fraction the
numerator of which is the number of days in such period from and after the
Closing Date and the denominator of which is the number of days in such
period;
(ix) any liabilities and obligations in respect of Taxes (other than
Prorated Items) attributable to the Auctioned Assets arising or accruing
during taxable periods (or portions thereof) beginning on or after the
Closing Date;
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(x) any liabilities and obligations in respect of damage to property
or personal injury or death relating to, resulting from or arising out of
any property, machinery, equipment, facilities or systems from time to
time owned by Buyer or its Affiliates subject to the Ancillary Agreements
or employed by Buyer in connection with the performance of the Ancillary
Agreements ("Buyer Assets"), or any Protective Relaying System owned by
Seller as contemplated by the Continuing Site Agreement, regardless of
whether the property damage or personal injury is caused by a Seller
Indemnitee or a Buyer Indemnitee;
(xi) any liabilities and obligations under the Ancillary Agreements
in respect of the Auctioned Assets to the extent arising on or after the
Closing Date; and
(xii) any liabilities and obligations relating to the Auctioned
Assets under the NYPA Agreements and listed on Schedule 2.03(a)(xii)(the
"Assumed Seller Obligations under NYPA Agreements"); provided, however,
that to the extent required for qualification of Buyer, with respect to
the Auctioned Assets, as an exempt wholesale generator under the Energy
Policy Act of 1992, Buyer may delegate and/or assign its obligations to
provide electricity and/or steam to NYPA to an Affiliate of Buyer;
provided further, however, that no such delegation or assignment shall
relieve Buyer of such obligations.
(b) Retained Liabilities. Buyer shall not assume or be obligated to
pay, perform or otherwise discharge the following liabilities or obligations
(the "Retained Liabilities")
(i) any liabilities and obligations of Seller primarily relating to
any Retained Assets (other than as contemplated by Section 2.03 (a)(x));
(ii) any payment obligations of Seller, including under Contracts,
for goods delivered or services rendered prior to the Closing Date;
(iii)(A) any Environmental Liability of Seller arising out of or in
connection with the transportation, storage, Release, threatened Release
or recycling of, or arrangement for such activities with respect to,
Hazardous Substances at or to any Off-Site location, prior to the Closing
Date, (B) any Environmental Liability of Seller arising out of or in
connection with any Release or threatened Release of
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any Hazardous Substance on or after the Closing Date from the Seller
Facilities or otherwise originating from, or relating to, any equipment
owned or used by Seller that is located on Buyer Real Estate and (C) any
liabilities and obligations relating to Auctioned Assets under the Seller
Consent Orders, except Assumed Consent Order Obligations;
(iv) any monetary fines (excluding (A) natural resource damages, (B)
cleanup or remediation costs and (C) other costs of a similar nature)
imposed by a Governmental Authority to the extent arising out of or
relating to acts or omissions of Seller in respect of the Auctioned Assets
prior to the Closing Date;
(v)(A) all wages, overtime, employment taxes, severance pay,
transition payments, workers compensation benefits, occupational safety
and health liabilities or other similar liabilities and obligations in
respect of Transferring Employees to the extent arising or accruing prior
to the Closing Date and (B) all other liabilities and obligations with
respect to the Transferring Employees for which Seller is responsible
pursuant to Article IX;
(vi)(A) any liabilities and obligations (other than any
Environmental Liabilities which are Assumed Obligations) in respect of any
personal injury or property damage claim relating to the Generating Plants
or Gas Turbines or (B) any liabilities and obligations in respect of any
discrimination, wrongful discharge or unfair labor practice claim by any
Transferring Employee, in the case of each of the foregoing clauses (A)
and (B), to the extent arising out of or relating to acts or omissions of
Seller prior to the Closing Date;
(vii) any liabilities and obligations, with respect to the period
prior to the Closing Date, for the Prorated Items, calculated as set forth
in Section 2.03(a)(viii);
(viii) any liabilities and obligations in respect of Taxes (other
than Prorated Items) attributable to the Auctioned Assets arising or
accruing during taxable periods (or portions thereof) ending before the
Closing Date, including Income Taxes attributable to income realized by
Seller pursuant to the transactions contemplated by this Agreement;
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(ix) any liabilities and obligations arising after the date of this
Agreement in respect of which Seller has provided pursuant to Section
7.01(d)(ii) that such liabilities and obligations shall not be assumed or
retained by Buyer;
(x) any liabilities and obligations in respect of damage to property
or personal injury or death relating to, resulting from or arising out of
any property, machinery, equipment, facilities or systems from time to
time owned by Seller or its Affiliates subject to the Ancillary Agreements
or employed by Seller in connection with the performance of the Ancillary
Agreements ("Seller Assets"), regardless of whether the property damage or
personal injury is caused by a Seller Indemnitee or a Buyer Indemnitee;
(xi) any liabilities and obligations under the Ancillary Agreements
in respect of the Retained Assets; and
(xii) any liabilities and obligations relating to Auctioned Assets
under the NYPA Agreements, except Assumed Seller Obligations under NYPA
Agreements.
SECTION 2.04. Third Party Consents. (a) Notwithstanding Section
2.02(a)(ii), (iii) or (iv), to the extent that Seller's rights under any
Contract or warranty may not be assigned without the consent of another person
which consent has not been obtained, this Agreement shall not constitute an
agreement to assign the same if an attempted assignment would constitute a
breach thereof or be unlawful, and Seller, at its expense, shall use its
reasonable best efforts to obtain prior to the Closing any such required
consents.
(b) Seller and Buyer agree that if any consent to an assignment of
any such Contract or warranty shall not be obtained or if any attempted
assignment would in Seller's reasonable opinion be ineffective or would impair
any material rights and obligations of Buyer under such Contract or warranty, as
applicable, so that Buyer would not acquire the benefit of all such rights and
obligations, Seller, to the maximum extent permitted by law and such Contract or
warranty, as applicable, shall after the Closing appoint Buyer to be Seller's
representative and agent with respect to such Contract or warranty, as
applicable, and Seller shall, to the maximum extent permitted by law and such
Contract or warranty, as applicable, enter into such reasonable arrangements
with Buyer as are necessary to provide Buyer with the benefits and obligations
of such
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Contract or warranty, as applicable. Seller and Buyer shall cooperate and shall
each use their reasonable best efforts after the Closing to obtain an assignment
of each such Contract or warranty, as applicable, to Buyer.
SECTION 2.05. Franchise Property. (a) Notwithstanding Section
2.02(a)(i), (ii) and (iii), to the extent it would be unlawful for Buyer to
operate, use or maintain the machinery, equipment and property listed on
Schedule 2.05(a)(collectively, the "Franchise Property") to Buyer without Buyer
obtaining from the City of New York a revocable consent, franchise agreement or
other arrangement permitting Buyer to hold title to the Franchise Property (the
"Revocable Consent"), Seller and Buyer agree that (i) Buyer shall use its
reasonable best efforts to cause the Revocable Consent to be entered into prior
to Closing, including filing a petition with the City of New York in respect of
the Revocable Consent not later than 45 days after the date of this Agreement,
and Seller shall cooperate in good faith in connection therewith, (ii) if the
Revocable Consent has not been obtained by Buyer prior to Closing (A) title to
the Franchise Property shall be deemed not to be transferred at Closing, (B)
Seller, to the maximum extent permitted by law, shall after Closing appoint
Buyer to be Seller's representative with respect to the Franchise Property, (C)
Seller shall operate, use and maintain the Franchise Property at Buyer's expense
and Buyer shall pay all real and personal property taxes applicable thereto and
(D) Buyer shall use its reasonable best efforts after Closing to cause the
Revocable Consent to be entered into, at which time title to the Franchise
Property shall be deemed transferred from Seller to Buyer pursuant to this
Agreement, and Seller shall cooperate in good faith in connection therewith and
(iii) Buyer shall pay all fees, charges and other expenses in connection with
the Revocable Consent.
(b) Seller and Buyer further agree that for the purposes of (i) the
Ancillary Agreements and Sections 2.03, 10.01 and 10.02 of this Agreement, the
terms "Auctioned Assets", "Buyer Assets" and "Buyer Facilities" shall in any
event each be deemed to include the Franchise Property and (ii) the Ancillary
Agreements, the Franchise Property shall in any event be deemed to be owned by
Buyer.
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ARTICLE III
Purchase Price
SECTION 3.01. Purchase Price. The purchase price for the Auctioned
Assets shall be $550,000,000 (the "Purchase Price").
SECTION 3.02. Post-Closing Adjustment. (a) Within 20 Business Days
after the Closing, Seller shall prepare and deliver to Buyer a statement (an
"Adjustment Statement") which reflects the book cost, as reflected on the books
of Seller as of the Closing Date, of all fuel inventory and supplies, materials
and spare parts inventory included in the Auctioned Assets (the "Adjustment
Amount") and, upon request of Buyer, related accounting material used by Seller
to prepare the Adjustment Statement. The Adjustment Amount will be based, in
respect of fuel, on the actual fuel inventory on the Closing Date and, in
respect of supplies, materials and spare parts, on an inventory survey conducted
within ten Business Days prior to the Closing Date, in each case, consistent
with the inventory procedures of Seller in effect as of the date of this
Agreement (the "Inventory Survey"). Seller will permit an employee, or
representative, of Buyer to observe the Inventory Survey. The Adjustment
Statement shall be prepared using (i) GAAP and (ii) the same rolling average
unit costs that Seller has historically used to calculate the book cost of its
fuel and supplies, materials and spare parts inventory. Buyer agrees to
cooperate with Seller in connection with the preparation of the Adjustment
Statement and related information, and shall provide to Seller such access,
books, records and information as may be reasonably requested from time to time.
(b) Buyer may dispute the quantity delivered or quality of any
inventory item shown on the Adjustment Statement, or the mathematical
calculations reflected therein, by notifying Seller in writing of the disputed
amount, and the basis of such dispute, within 20 Business Days of Buyer's
receipt of the Adjustment Statement; provided, however, that in respect of the
quality of any inventory item, Buyer may not dispute Seller's normal and
customary methods for accounting for excess inventory. Buyer shall have no right
to dispute any other matter in respect of the Adjustment Statement, including
historical rolling average unit costs used to calculate the book cost of the
inventory or the appropriateness, under GAAP or otherwise, of using such
historical rolling average unit cost to determine the book cost of any
particular item of inventory. In the event of a dispute with respect to the
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quantity or quality of any inventory item shown on the Adjustment Statement, or
the mathematical calculations reflected therein, Buyer and Seller shall attempt
to reconcile their differences and any resolution by them as to any disputed
amounts shall be final, binding and conclusive on the Parties. If Buyer and
Seller are unable to reach a resolution of such differences within 20 Business
Days of receipt of Buyer's written notice of dispute to Seller, Buyer and Seller
shall submit the amounts remaining in dispute for determination and resolution
to PricewaterhouseCoopers LLP or any other accounting firm of recognized
national standing reasonably acceptable to Seller and Buyer (the "Accountants"),
which shall be instructed to determine and report to the Parties, within 20
Business Days after such submission, upon such remaining disputed amounts, and
such report shall be final, binding and conclusive on the Parties with respect
to the amounts disputed. Buyer and Seller shall each pay one-half of the fees
and disbursements of the Accountants in connection with the resolution of such
disputed amounts.
(c) If the Adjustment Amount is greater or less than the Estimated
Adjustment Amount, then on the Adjustment Date (as defined below), (i) to the
extent that the Adjustment Amount exceeds the Estimated Adjustment Amount, Buyer
shall pay to Seller the amount of such excess and (ii) to the extent that the
Adjustment Amount is less than the Estimated Adjustment Amount, Seller shall pay
to Buyer the amount of such deficiency. "Adjustment Date" means (1) if Buyer
does not disagree in any respect with the Adjustment Statement, the twenty-third
Business Day following Buyer's receipt of the Adjustment Statement or (2) if
Buyer shall disagree in any respect with the Adjustment Statement, the third
Business Day following either the resolution of such disagreement by the Parties
or a final determination by the Accountants in accordance with Section 3.02(b).
Any amount paid under this Section 3.02(c) shall be paid with interest for the
period commencing on the Closing Date through the date of payment, calculated at
the prime rate of the Chase Manhattan Bank in effect on the Closing Date, and in
cash by wire transfer of immediately available funds.
SECTION 3.03. Allocation of Purchase Price. Buyer shall deliver to
Seller at Closing a preliminary allocation among the Auctioned Assets of the
Purchase Price and among such other consideration paid to Seller pursuant to
this Agreement that is properly includible in Buyer's tax basis for the
Auctioned Assets for Federal income tax purposes, and, as soon as practicable
following the Closing (but in any event within 10 Business Days following the
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final determination of the Adjustment Amount), Buyer shall prepare and deliver
to Seller a final allocation of the Purchase Price and additional consideration
described in the preceding clause, and the post-closing adjustment pursuant to
Section 3.02, among the Auctioned Assets (the "Allocation"). The Allocation
shall be consistent with Section 1060 of the Code and the Treasury Regulations
thereunder. Seller hereby agrees to accept Buyer's Allocation unless Seller
determines that such Allocation was not prepared in accordance with Section 1060
of the Code and the regulations thereunder ("Applicable Law"). If Seller so
determines, Seller shall within 20 Business Days thereafter propose any changes
necessary to cause the Allocation to be prepared in accordance with Applicable
Law. Within 10 Business Days following delivery of such proposed changes, Buyer
shall provide Seller with a statement of any objections to such proposed
changes, together with a reasonably detailed explanation of the reasons
therefor. If Buyer and Seller are unable to resolve any disputed objections
within 10 Business Days thereafter, such objections shall be referred to the
Accountants, whose review will be limited to whether Buyer's Allocation of such
disputed items regarding the Allocation was prepared in accordance with
Applicable Law. The Accountants shall be instructed to deliver to Seller and
Buyer a written determination of the proper allocation of such disputed items
within 20 Business Days. Such determination shall be conclusive and binding upon
the parties hereto for all purposes, and the Allocation shall be so adjusted
(the Allocation, including the adjustment, if any, to be referred to as the
"Final Allocation"). The fees and disbursements of the Accountants attributable
to the Allocation shall be shared equally by Buyer and Seller. Each of Buyer and
Seller agrees to timely file Internal Revenue Service Form 8594, and all
Federal, state, local and foreign Tax Returns, in accordance with such Final
Allocation and to report the transactions contemplated by this Agreement for
Federal Income Tax and all other tax purposes in a manner consistent with the
Final Allocation. Each of Buyer and Seller agrees to promptly provide the other
party with any additional information and reasonable assistance required to
complete Form 8594, or compute Taxes arising in connection with (or otherwise
affected by) the transactions contemplated hereunder. Each of Buyer and Seller
shall timely notify the other Party and each shall timely provide the other
Party with reasonable assistance in the event of an examination, audit or other
proceeding regarding the Final Allocation.
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ARTICLE IV
The Closing
SECTION 4.01. Time and Place of Closing. Upon the terms and subject
to the satisfaction of the conditions contained in Article VIII, the closing of
the sale of the Auctioned Assets contemplated by this Agreement (the "Closing")
will take place on such date as the Parties may agree, which date shall be as
soon as practicable, but no later than ten Business Days, following the date on
which all of the conditions set forth in Article VIII have been satisfied or
waived, at the offices of Cravath, Swaine & Moore in New York City or at such
other place or time as the Parties may agree. The date and time at which the
Closing actually occurs is hereinafter referred to as the "Closing Date".
SECTION 4.02. Payment of Purchase Price and Estimated Adjustment
Amount. At the Closing, Buyer will pay or cause to be paid to Seller by wire
transfer of immediately available funds to an account previously designated in
writing by Seller an amount in United States dollars equal to (a) the Purchase
Price plus (b) Seller's good faith estimate of the Adjustment Amount (the
"Estimated Adjustment Amount"), which estimate shall be provided to Buyer no
later than five Business Days prior to the Closing.
ARTICLE V
Representations and Warranties of Seller
Seller represents and warrants to Buyer as follows:
SECTION 5.01. Organization; Qualification. Seller is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of New York and has all requisite corporate power and authority to own,
lease and operate the Auctioned Assets and to carry on the business of the
Auctioned Assets as currently conducted.
SECTION 5.02. Authority Relative to This Agreement. Seller has all
necessary corporate power and authority to execute and deliver this Agreement
and the Ancillary Agreements and to consummate the transactions contemplated
hereby and thereby. The execution and delivery by Seller of this Agreement and
the Ancillary Agreements and the consummation by Seller of the transactions
contemplated hereby and thereby have been duly and validly authorized by
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the Board of Trustees of Seller or by a committee thereof to whom such authority
has been delegated and no other corporate proceedings on the part of Seller are
necessary to authorize this Agreement or the Ancillary Agreements or the
consummation of the transactions contemplated hereby or thereby. This Agreement
and the Ancillary Agreements have been duly and validly executed and delivered
by Seller and, assuming that this Agreement and the Ancillary Agreements
constitute valid and binding agreements of Buyer and each other party thereto,
subject to the receipt of the Seller Required Regulatory Approvals and the Buyer
Required Regulatory Approvals, constitute valid and binding agreements of
Seller, enforceable against Seller in accordance with their respective terms.
SECTION 5.03. Consents and Approvals; No Violation. (a) Subject to
obtaining the Seller Required Regulatory Approvals and the Buyer Required
Regulatory Approvals, neither the execution and delivery of this Agreement or
the Ancillary Agreements by Seller nor the sale by Seller of the Auctioned
Assets pursuant to this Agreement will (i) conflict with or result in any breach
of any provision of the Certificate of Incorporation or By-laws of Seller, (ii)
except as set forth on Schedule 5.03(a), result in a default (or give rise to
any right of termination, cancelation or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
agreement, lease or other instrument or obligation to which Seller is a party or
by which Seller, or any of the Auctioned Assets, may be bound, except for such
defaults (or rights of termination, cancelation or acceleration) as to which
requisite waivers or consents have been obtained or which would not,
individually or in the aggregate, create a Material Adverse Effect or (iii)
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to Seller, or the Auctioned Assets, except for such violations which
would not, individually or in the aggregate, create a Material Adverse Effect.
(b) Except for (i) application by Seller to, and the approval of,
the PSC, pursuant to ss. 70 of the Public Service Law of the State of New York,
of the transfer to Buyer of the Auctioned Assets, (ii) the filings by Seller and
Buyer required by the HSR Act and the expiration or earlier termination of all
waiting periods under the HSR Act, (iii) application by Seller to, and the
approval of, FERC under (A) Section 203 of the Federal Power Act of 1935 (the
"Federal Power Act") with respect to the transfer of Auctioned Assets
constituting jurisdictional assets under the Federal Power Act and (B) Section
205 of the Federal Power Act with respect to each Continuing Site Agreement and
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any wholesale power sales agreement to be entered into by Seller and Buyer,
including the Transition Capacity Agreement, (iv) the issuance of approval by
the New York City Department of Buildings and, to the extent required, the New
York City Department of Business Services of the tax lot subdivision
contemplated by this Agreement in a form suitable for submission to the New York
City Department of Finance for the issuance of tax lot numbers and (v)
declarations, filings or registrations with, or notices to, or authorizations,
consents or approvals of, any Governmental Authority which become applicable to
Seller or the transactions contemplated hereby or by the Ancillary Agreements as
a result of the specific regulatory status or jurisdiction of incorporation or
organization of Buyer (or any of its Affiliates) or as a result of any other
facts that specifically relate to the business or activities in which Buyer (or
any of its Affiliates) is or proposes to be engaged (collectively, the "Seller
Required Regulatory Approvals"), no declaration, filing or registration with, or
notice to, or authorization, consent or approval of any Governmental Authority
is necessary for the consummation by Seller of the transactions contemplated
hereby or by the Ancillary Agreements, other than such declarations, filings,
registrations, notices, authorizations, consents or approvals (A) which, if not
obtained or made, would not, individually or in the aggregate, create a Material
Adverse Effect or (B) which relate to the Transferable Permits.
(c) To the knowledge of Seller, there is no reason that it should
fail to obtain the Seller Required Regulatory Approvals.
SECTION 5.04. Year 2000. Seller has informed Buyer of the status, as
of the date of this Agreement, of measures to prevent computer software,
hardware and embedded systems used in connection with the Auctioned Assets from
experiencing malfunctions or other usage problems in connection with years
beginning with "20", except for such malfunctions or other usage problems which
would not, individually or in the aggregate, create a Material Adverse Effect.
SECTION 5.05. Personal Property. Except for Permitted Exceptions,
Seller has good and marketable title, free and clear of all Encumbrances, to all
personal property included in the Auctioned Assets.
SECTION 5.06. Real Estate. The Conveyance Plans contain descriptions
of the Buyer Real Estate. Copies of the most recent real property surveys and
title insurance information in the possession of Seller with respect to the
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Buyer Real Estate or any portion thereof have heretofore been delivered by
Seller to Buyer or made available for inspection by Buyer, receipt of which is
hereby acknowledged by Buyer.
SECTION 5.07. Leases. As of the date of this Agreement, Seller is
neither a tenant nor a licensee under any real property leases or licenses which
(a) are to be transferred and assigned to Buyer on the Closing Date and (b)(i)
provide for annual payments of more than $100,000 or (ii) are material to the
Auctioned Assets.
SECTION 5.08. Certain Contracts and Arrangements. (a) Except for (i)
any contract or agreement listed on Schedule 2.02(a)(iv) or Schedule 5.08(a) and
(ii) Contracts which will expire prior to the Closing Date or that are permitted
to be entered into under this Agreement, Seller is not a party to any contract
which is material to the business or operations of the Auctioned Assets. Seller
has made available to Buyer for inspection true and complete copies of all
contracts listed on Schedule 2.02(a)(iv) or Schedule 5.08(a) and each of the
NYPA Agreements.
(b) Each Contract (i) constitutes a valid and binding obligation of
Seller, and, to the knowledge of Seller, constitutes a valid and binding
obligation of the other parties thereto, (ii) to the knowledge of Seller, is in
full force and effect and (iii) other than Contracts covered by Section 2.04, to
the knowledge of Seller, may be transferred to Buyer pursuant to this Agreement
and will continue in full force and effect thereafter, in each case, without
breaching the terms thereof or resulting in the forfeiture or impairment of any
rights thereunder, except for such breaches, forfeitures or impairments which
would not, individually or in the aggregate, create a Material Adverse Effect.
(c) There is not, under any of the Contracts or any of the NYPA
Agreements, any default or event which, with notice or lapse of time or both,
would constitute a default by Seller, except for such events of default and
other events as to which requisite waivers or consents have been obtained or
which would not, individually or in the aggregate, create a Material Adverse
Effect.
SECTION 5.09. Legal Proceedings. Except as set forth on Schedule
5.09 or in the Filed Seller SEC Documents, as of the date of this Agreement,
there are no claims, actions, proceedings or investigations pending or, to the
knowledge of Seller, threatened against or relating to Seller which would,
individually or in the aggregate, be
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reasonably expected to create a Material Adverse Effect. With respect to the
business or operations of the Auctioned Assets, Seller is not, as of the date of
this Agreement, subject to any outstanding judgment, rule, order, writ,
injunction or decree of any court, governmental or regulatory authority which
would create a Material Adverse Effect. The representations and warranties of
Seller set forth in this Section 5.09 shall not apply to, and do not cover, any
environmental matters which, with respect to any representations and warranties
of Seller, are exclusively governed by Section 5.11.
SECTION 5.10. Permits; Compliance with Law. (a) Except as set forth
on Schedule 5.l0(a)(i), Seller holds, and is in compliance with, all Permits
necessary to conduct the business and operations of the Auctioned Assets as
currently conducted, and, to the knowledge of Seller, Seller is otherwise in
compliance with all laws, statutes, orders, rules, regulations, ordinances or
judgments of any Governmental Authority applicable to the business and
operations of the Auctioned Assets, except for such failures to hold or comply
with such Permits, or such failures to be in compliance with such laws,
statutes, orders, rules, regulations, ordinances or judgments, which would not,
individually or in the aggregate, create a Material Adverse Effect. Except as
set forth on Schedule 5.10(a)(ii), Seller has not received any written
notification that it is in violation of any of such Permits or laws, statutes,
orders, rules, regulations, ordinances or judgments, except for notifications of
violations which would not, individually or in the aggregate, create a Material
Adverse Effect. The representations and warranties of Seller set forth in this
Section 5.10 shall not apply to, and do not cover, any environmental matters
which, with respect to any representations and warranties of Seller, are
exclusively governed by Section 5.11.
(b) Notwithstanding the last sentence of Section 5.10(a), except as
set forth on Schedule 5.10(b), there are no material Permits or material
Environmental Permits that, in each case, are not Transferable Permits and are
required for Buyer to conduct the business and operations of the Auctioned
Assets as currently conducted.
SECTION 5.11. Environmental Matters. (a) Except as set forth in
Schedule 5.11 or disclosed in the Filed Seller SEC Documents, Seller holds, and
is in compliance with, the Environmental Permits required for Seller to conduct
the business and operations of the Auctioned Assets as currently conducted under
applicable Environmental Laws, and, to the knowledge of Seller, Seller is
otherwise in
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compliance with applicable Environmental Laws with respect to the business and
operations of the Auctioned Assets, except for such failures to hold or comply
with such Environmental Permits, or such failures to be in compliance with such
Environmental Laws, which would not, individually or in the aggregate, create a
Material Adverse Effect.
(b) Except as set forth in Schedule 5.11 or disclosed in the Filed
Seller SEC Documents, Seller has not received any written notice of violation of
any Environmental Law or any written request for information with respect
thereto, or been notified that it is a potentially responsible party under the
Federal Comprehensive Environmental Response, Compensation, and Liability Act or
any similar state law with respect to any real property included in the Buyer
Real Estate or in any lease forming part of the Auctioned Assets, except for
such matters under such laws as would not, individually or in the aggregate,
create a Material Adverse Effect.
(c) Except as set forth in Schedule 5.11 or disclosed in the Filed
Seller SEC Documents, with respect to the business and operations of the
Auctioned Assets, Seller is not subject to any outstanding judgment, decree or
judicial order relating to compliance with any Environmental Law or to
investigation or cleanup of Hazardous Substances under any applicable
Environmental Law, except for (i) the Seller Consent Orders and (ii) such
judgments, decrees or judicial orders that would not, individually or in the
aggregate, create a Material Adverse Effect.
(d) Except as set forth in Schedule 5.11 or disclosed in the Filed
Seller SEC Documents, as of the date of this Agreement, there are no claims,
actions, proceedings or investigations pending, or to the knowledge of Seller,
threatened against or relating to Seller, with respect to the exposure at the
Auctioned Assets of any person to Hazardous Substances, which, if adversely
determined, would, individually or in the aggregate, create a Material Adverse
Effect.
SECTION 5.12. Labor Matters. Seller has previously made available to
Buyer copies of all collective bargaining agreements to which Seller is a party
or is subject and which relate to the business or operations of the Auctioned
Assets. With respect to the business and operations of the Auctioned Assets, as
of the date of this Agreement, (a) Seller is in compliance with all applicable
laws regarding employment and employment practices, terms and conditions of
employment and wages and hours, (b) Seller has not received written notice of
any unfair labor practice
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complaint against Seller pending before the National Labor Relations Board, (c)
there is no labor strike, slowdown or stoppage actually pending or, to the
knowledge of Seller, threatened against or affecting Seller, (d) Seller has not
received notice that any representation petition respecting the employees of
Seller has been filed with the National Labor Relations Board, (e) no
arbitration proceeding arising out of or under collective bargaining agreements
is pending against Seller and (f) Seller has not experienced any primary work
stoppage since at least December 31, 1996, except, in the case of each of the
foregoing clauses (a) through (f), for such matters as would not, individually
or in the aggregate, create a Material Adverse Effect.
SECTION 5.13. ERISA: Benefit Plans. Schedule 5.13 sets forth a list
of all material deferred compensation, profit-sharing, retirement and pension
plans and all material bonus and other material employee benefit or fringe
benefit plans maintained, or with respect to which contributions have been made,
by Seller with respect to current or former employees employed in connection
with the power generation operations of the Generating Plants and the Gas
Turbines (collectively, "Benefit Plans"). Seller and each trade or business
(whether or not incorporated) which are or have ever been under common control,
or which are or have ever been treated as a single employer, with Seller under
Section 414(b), (c), (m) or (o) of the Code (an "ERISA Affiliate") have
fulfilled their respective obligations under the minimum funding requirements of
Section 302 of ERISA, and Section 412 of the Code, with respect to each Benefit
Plan which is an "employee pension benefit plan" as defined in Section 3(2) of
ERISA and each such plan is in compliance in all material respects with the
presently applicable provisions of ERISA and the Code, except for such failures
to fulfill such obligations or comply with such provisions which would not,
individually or in the aggregate, create a Material Adverse Effect. Neither
Seller nor any ERISA Affiliate has incurred any liability under Section 4062(b)
of ERISA, or any withdrawal liability under Section 4201 of ERISA, to the
Pension Benefit Guaranty Corporation in connection with any Benefit Plan which
is subject to Title IV of ERISA which liability remains outstanding, and there
has not been any reportable event (as defined in Section 4043 of ERISA) with
respect to any such Benefit Plan (other than a reportable event with respect to
which the 30-day notice requirement has been waived by the PBGC). Neither Seller
nor any ERISA Affiliate or parent corporation, within the meaning of Section
4069(b) or Section 4212(c) of ERISA, has engaged in any transaction, within the
meaning of Section 4069(b) or Section 4212(c) of ERISA. No Benefit Plan and no
"employee pension benefit
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plan" (as defined in Section 3(2) of ERISA) maintained by Seller or any ERISA
Affiliate or to which Seller or any ERISA Affiliate has contributed is a
multiemployer plan.
SECTION 5.14. Taxes With respect to the Auctioned Assets and trades
or businesses associated with the Auctioned Assets, (a) all Tax Returns required
to be filed have been filed and (b) all Taxes shown to be due on such Tax
Returns, and all Taxes otherwise owed, have been paid in full, except to the
extent that any failure to file or any failure to pay any Taxes would not,
individually or in the aggregate, create a Material Adverse Effect. No written
notice of deficiency or assessment has been received from any taxing authority
with respect to liabilities for Taxes of Seller in respect of the Auctioned
Assets which has not been fully paid or finally settled or which is not being
contested in good faith through appropriate proceedings, except for any such
notices regarding Taxes which would not, individually or in the aggregate,
create a Material Adverse Effect. There are no outstanding agreements or waivers
extending the applicable statutory periods of limitation for Taxes associated
with the Auctioned Assets for any period, except for any such agreements or
waivers which would not, individually or in the aggregate, create a Material
Adverse Effect.
SECTION 5.15. Independent Engineering Assessments. (a) Seller has
reviewed the 1998 assessments prepared by Stone & Webster with respect to the
Generating Plants and the Gas Turbines (the "Independent Engineering
Assessments"), and, except as set forth on Schedule 5.15(a), to the knowledge of
Seller, as of the date of the Independent Engineering Assessments, there was no
untrue statement of a material fact or omission of any material fact therein
that would reasonably suggest that the condition of the Generating Plants and
the Gas Turbines, taken as a whole, as of such date was materially and adversely
different from that described in such Independent Engineering Assessments.
(b) Except as set forth on Schedule 5.15(b), since the date of the
Independent Engineering Assessments, there has not been, subject to ordinary
wear and tear and to routine maintenance, any casualty, physical damage,
destruction or physical loss with respect to, or, to the knowledge of Seller,
any adverse change in the physical condition of, any Generating Plant or Gas
Turbine, except for such casualty, physical damage, destruction, physical loss
or adverse change which would not, individually or in the aggregate, create a
Material Adverse Effect.
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SECTION 5.16. Undisclosed Liabilities. With respect to the Auctioned
Assets, there are no liabilities or obligations of any nature or kind (absolute,
accrued, contingent or otherwise) that would have been required to be set forth
on a balance sheet in respect of the Auctioned Assets or in the notes thereto
prepared in accordance with GAAP, as applied by Seller in connection with its
December 31, 1997 balance sheet, except for any such liabilities or obligations
which (a) are disclosed in or contemplated or permitted by this Agreement or the
Ancillary Agreements (including the Assumed Obligations), (b) are disclosed in
the Offering Memorandum, (c) are disclosed in the Filed Seller SEC Documents,
(d) have been incurred in the ordinary course of business, (e) are disclosed on
Schedule 5.16 or (f) which would not, individually or in the aggregate, create a
Material Adverse Effect.
SECTION 5.17. Brokers. No broker, finder or other person is entitled
to any brokerage fees, commissions or finder's fees in connection with the
transaction contemplated hereby by reason of any action taken by Seller, except
Morgan Stanley & Co. Incorporated, which is acting for and at the expense of
Seller.
SECTION 5.18. Insurance. Seller carries policies of insurance
covering fire, workers' compensation, property all-risk, comprehensive bodily
injury, property damage liability, automobile liability, product liability,
completed operations, explosion, collapse, contractual liability, personal
injury liability and other forms of insurance relating to the Auctioned Assets,
or otherwise self-insures in accordance with all statutory and regulatory
criteria against any such liabilities, which insurance is in such amounts, has
such deductibles and retentions and is underwritten by such companies as would
be obtained by a reasonably prudent electric power business.
EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
THIS ARTICLE V, THE AUCTIONED ASSETS ARE BEING SOLD AND TRANSFERRED "AS IS,
WHERE IS", AND SELLER IS NOT MAKING ANY OTHER REPRESENTATIONS OR WARRANTIES
WRITTEN OR ORAL, STATUTORY, EXPRESS OR IMPLIED, CONCERNING SUCH AUCTIONED ASSETS
OR WITH RESPECT TO THIS AGREEMENT OR THE ANCILLARY AGREEMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, INCLUDING, IN PARTICULAR WITH
RESPECT TO THE AUCTIONED ASSETS, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR
A PARTICULAR PURPOSE, ALL OF WHICH ARE HEREBY EXPRESSLY EXCLUDED AND DISCLAIMED
BY SELLER AND WAIVED BY BUYER. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
SELLER MAKES NO REPRESENTATION OR WARRANTY WITH RESPECT TO THE INFORMATION SET
FORTH IN, OR CONTEMPLATED BY, THE
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OFFERING MEMORANDUM (EXCEPT TO THE EXTENT EXPRESSLY INCORPORATED BY REFERENCE
INTO THIS AGREEMENT).
ARTICLE VI
Representations and Warranties of Buyer
Buyer represents and warrants to Seller as follows:
SECTION 6.01. Organization. Buyer is a limited partnership duly
formed, validly existing and in good standing under the laws of the State of
Delaware and has all requisite power and authority to own, lease and operate its
properties and to carry on its business as is now being conducted. Buyer shall
be duly qualified and licensed to do business as a foreign corporation and is in
good standing in the State of New York on or prior to the Closing Date.
SECTION 6.02. Authority Relative to This Agreement. Buyer has all
necessary power and authority to execute and deliver this Agreement and the
Ancillary Agreements to which it is party and to consummate the transactions
contemplated hereby and thereby. The execution and delivery by Buyer of this
Agreement and such Ancillary Agreements and the consummation by Buyer of the
transactions contemplated hereby and thereby have been duly and validly
authorized by the Board of Directors of the general partner of Buyer and no
other proceedings on the part of Buyer are necessary to authorize this Agreement
or such Ancillary Agreements or the consummation of the transactions
contemplated hereby or thereby. This Agreement and such Ancillary Agreements
have been duly and validly executed and delivered by Buyer and, assuming that
this Agreement and the Ancillary Agreements constitute valid and binding
agreements of Seller and each other party thereto, subject to the receipt of the
Buyer Required Regulatory Approvals and the Seller Required Regulatory
Approvals, this Agreement and the Ancillary Agreements constitute valid and
binding agreements of Buyer, enforceable against Buyer in accordance with their
respective terms.
SECTION 6.03. Consents and Approvals; No Violation. (a) Subject to
obtaining the Buyer Required Regulatory Approvals and the Seller Required
Regulatory Approvals, neither the execution and delivery of this Agreement or
the Ancillary Agreements to which it is party by Buyer nor the purchase by Buyer
of the Auctioned Assets pursuant to this Agreement will (i) conflict with or
result in any breach of any provision of the limited partnership
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agreement (or other similar governing documents) of Buyer, (ii) result in a
default (or give rise to any right of termination, cancelation or acceleration)
under any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, agreement, lease or other instrument or obligation to which
Buyer or any of its subsidiaries is a party or by which any of their respective
assets may be bound or (iii) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to Buyer, or any of its assets, except in
the case of clauses (ii) and (iii) for such failures to obtain a necessary
consent, defaults and violations which would not, individually or in the
aggregate, have a material adverse effect on the ability of Buyer to consummate
the transactions contemplated by, and discharge its obligations under, this
Agreement and the Ancillary Agreements (a "Buyer Material Adverse Effect").
(b) Except for (i) approval of the PSC pursuant to ss. 70 of the
Public Service Law of the State of New York, of the transfer to Buyer of the
Auctioned Assets, (ii) the filings by Buyer and Seller required by the HSR Act
and the expiration or earlier termination of all waiting periods under the HSR
Act, (iii) application by Buyer to, and the approval of, FERC under (A) Section
203 of the Federal Power Act with respect to the transfer of Auctioned Assets
constituting jurisdictional assets under the Federal Power Act and (B) Section
205 of the Federal Power Act with respect to (1) each Continuing Site Agreement
and any wholesale power sales agreement to be entered into by Seller and Buyer,
including the Transition Capacity Agreement, and (2) authorization to sell
capacity and energy from Generating Plants and Gas Turbines at market-based
rates (provided, however, that Buyer acknowledges that "market-based rates" for
the purpose of this Agreement means rates that are subject to any bid cap, price
limitation or other market power mitigation measure imposed by FERC or PSC in
respect of the New York State or New York City wholesale and retail energy and
capacity electric power markets or any other restriction imposed by FERC or PSC
with respect to the power generation operations and assets of Buyer, including
the FERC Order Accepting Market Power Mitigation Measures dated September 22,
1998, as modified (Docket No. ER98-3169-000)(the "Mitigation Measures")), (iv)
qualification of Buyer, with respect to the Auctioned Assets, as an exempt
wholesale generator under the Energy Policy Act of 1992, (v) the issuance of
approval by the New York City Department of Buildings and, to the extent
required, the New York City Department of Business Services of the tax lot
subdivision contemplated by this Agreement in a form suitable for submission to
the New York City Department of Finance for the issuance of tax lot numbers and
(vi) obtaining the
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Revocable Consent from the City of New York (collectively, the "Buyer Required
Regulatory Approvals"), no declaration, filing or registration with, or notice
to, or authorization, consent or approval of any Governmental Authority is
necessary for the consummation by Buyer of the transactions contemplated hereby
or by the Ancillary Agreements, other than such declarations, filings,
registrations, notices, authorizations, consents or approvals (A) which, if not
obtained or made would not, individually or in the aggregate, have a Buyer
Material Adverse Effect or (B) which relate to the Transferable Permits.
(c) To the knowledge of Buyer, there is no reason that it should
fail to obtain the Buyer Required Regulatory Approvals.
SECTION 6.04. Availability of Funds. Buyer will have sufficient
funds available to it or will have received binding written commitments (copies
of which will be delivered to Seller when available) from one or more nationally
recognized financial institutions to provide sufficient funds on the Closing
Date to pay the Purchase Price and Estimated Adjustment Amount.
SECTION 6.05. Brokers. No broker, finder or other person is entitled
to any brokerage fees, commissions or finder's fees in connection with the
transaction contemplated hereby by reason of any action taken by Buyer.
ARTICLE VII
Covenants of the Parties
SECTION 7.01. Conduct of Business Relating to the Auctioned Assets.
(a) Except with the prior written consent of Buyer (such consent not to be
unreasonably withheld) or as required to effect the purchase and sale of the
Auctioned Assets and related transactions contemplated by this Agreement, during
the period from the date of this Agreement to the Closing Date, Seller will
operate the Auctioned Assets in the usual, regular and ordinary course and in
accordance with good industry practice and applicable legal requirements, and
continue to pay accounts payable which relate to the Auctioned Assets in a
timely manner, consistent with past practice.
(b) Notwithstanding the foregoing, except as contemplated in this
Agreement or the Ancillary Agreements, prior to the Closing Date, without the
prior written consent
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of Buyer (such consent not to be unreasonably withheld), Seller will not:
(i) except for Permitted Exceptions, grant any Encumbrance on the
Auctioned Assets securing any indebtedness for borrowed money or guarantee
or other liability for the obligations of any person;
(ii) make any material change in the levels of fuel inventory and
supplies, materials and spare parts inventory customarily maintained by
Seller with respect to the Auctioned Assets, other than consistent with
past practice (including the use of spare parts in connection with certain
power generation assets of Seller described in the Offering Memorandum
other than the Generating Plants or Gas Turbines);
(iii) sell, lease (as lessor), transfer or otherwise dispose of, any
of the Auctioned Assets, other than assets that become obsolete or assets
used, consumed or replaced in the ordinary course of business consistent
with past practice (including the use of spare parts in connection with
certain power generation assets of Seller described in the Offering
Memorandum other than the Generating Plants or Gas Turbines);
(iv) terminate, materially extend or otherwise materially amend any
of the Contracts (other than in accordance with their respective terms) or
waive any default by, or release, settle or compromise any material claim
against, any other party thereto;
(v) amend any of the Transferable Permits, other than (A)
Transferable Permits not material to the operations of the Auctioned
Assets as currently conducted, (B) as reasonably necessary to complete the
transfer of Permits as contemplated hereby, (C) routine renewals or
non-material modifications or amendments and (D) modifications,
alterations and amendments contemplated by Section 7.03(b);
(vi) enter into any Contract for the purchase, sale or storage of
fuel with respect to the Auctioned Assets (whether commodity or
transportation) with a term in excess of 12 months, if the aggregate
future liability or receivable outstanding on the date for measurement for
the purpose of this covenant for all such Contracts would be in excess of
$2 million, not including any such Contract terminable by notice of not
more than 30 days without penalty or cost (other than de minimis
administrative costs); provided, however, that Seller
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may enter into Contracts for the storage of fuel with respect to the
Auctioned Assets with a term ending not later than December 31, 2000 and
otherwise on terms consistent with Seller's past practice;
(vii)(A) establish, adopt, enter into or amend any Collective
Bargaining Agreement or Benefits Plans, except (1) if such action would
not create a Material Adverse Effect or (2) as required under applicable
law or under the terms of any Collective Bargaining Agreement or (B) grant
to any Affected Employee any increase in compensation, except (1) in the
ordinary course of business consistent with past practice or (2) to the
extent required by the terms of any Collective Bargaining Agreement,
employment agreement in effect as of the date of this Agreement or
applicable law;
(viii) enter into any Contract with respect to the Auctioned Assets
for goods or services not addressed in clauses (i) through (vii) with a
term in excess of 12 months, if the aggregate future liability or
receivable outstanding on the date for measurement for the purpose of this
covenant for all such Contracts would be in excess of $2 million, not
including any such Contract terminable by notice of not more than 30 days
without penalty or cost (other than de minimis administrative costs);
provided, however, that notwithstanding any other provision of this
Agreement to the contrary, Seller may (A) enter into any Contract
reasonably necessary to effect the physical, legal or operational
separation of the sites on which the Auctioned Assets are located or to
otherwise implement the change of ownership contemplated hereby, or
subdivision, of such sites or implement the provisions of the Ancillary
Agreements and (B) enter into and record the Declarations of Subdivision
Easements; or
(ix) enter into any Contract with respect to the Auctioned Assets
relating to any of the transactions set forth in the foregoing clauses (i)
through (viii).
(c) Without limiting the generality of Sections 7.01(a) and (b), to
the extent Section 7.01(a) or (b) prohibits Seller from entering into any
Contract for goods and services in connection with maintenance or capital
expenditures, Buyer agrees that Seller may request Buyer's consent to enter into
such Contract, such consent not to be unreasonably withheld, and to the extent
Buyer so consents, all liabilities and obligations under such Contract shall
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constitute Assumed Obligations and Buyer shall otherwise reimburse Seller for
all its expenditures thereunder.
(d) Notwithstanding anything in this Section 7.01 to the contrary,
Seller may take any action, incur any expense or enter into any obligation with
respect to the Auctioned Assets to the extent that (i) all obligations and
liabilities arising with respect thereto do not constitute Assumed Obligations
or (ii) Seller otherwise provides that such obligations and liabilities shall
not be assumed or retained by Buyer.
(e) Notwithstanding anything in this Section 7.01 to the contrary,
Seller may (i) amend the NYPA Operating Agreement in order to (A) provide NYPA
with the use of the fuel handling facilities related to the A-10 dock at Astoria
for fuel oil deliveries in accordance with historic fuel deliveries to NYPA at
such dock, (B) establish procedures for scheduling such fuel oil deliveries to
provide a fair allocation of the right to use such fuel handling facilities, (C)
provide for reimbursement of NYPA for incremental, reasonable fuel costs
incurred by NYPA to obtain replacement fuel when Buyer fails to satisfy its
obligations under the NYPA Agreements assumed pursuant to Section 2.03(a)(xii)
and relating to the obligations described in clause (A) or clause (B) above and
(D) provide for the installation by NYPA of water meters and the allocation of
charges for water as between NYPA and Buyer based on readings therefrom and (ii)
obtain title to the machinery, equipment, facilities, furniture and other
personal property listed on Schedule 2.02(a)(iii)(D), and Buyer agrees that the
Assumed Seller Obligations under NYPA Agreements shall be deemed amended
accordingly.
SECTION 7.02. Access to Information. (a) Between the date of this
Agreement and the Closing Date, Seller will, subject to the Confidentiality
Agreement, during ordinary business hours and upon reasonable notice (i) give
Buyer and its representatives reasonable access (A) to all books, records,
plants, offices and other facilities and properties constituting the Auctioned
Assets, including for the purpose of observing the operation by Seller of the
Auctioned Assets and (B) to the Auctioned Assets that are not located at the
Generating Plants or Gas Turbines for the purpose of preparing to store spare
parts after the Closing, (ii) permit Buyer to make such reasonable inspections
thereof as Buyer may reasonably request, (iii) furnish Buyer with such financial
and operating data and other information with respect to the Auctioned Assets as
Buyer may from time to time reasonably request, (iv) furnish Buyer upon request
a copy of each material
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report, schedule or other document with respect to the Auctioned Assets filed by
Seller with, or received by Seller from, the PSC or FERC; provided, however,
that (A) any such activities shall be conducted in such a manner as not to
interfere unreasonably with the operation of the Auctioned Assets, (B) Seller
shall not be required to take any action which would constitute a waiver of the
attorney-client privilege and (C) Seller need not supply Buyer with (1) any
information or access which Seller is under a legal obligation not to supply or
(2) any information which Seller has previously supplied to Buyer.
Notwithstanding anything in this Section 7.02 to the contrary, (I) Seller will
not be required to provide such information or access to any employee records
other than Transferring Employee Records, (II) Buyer shall not have the right to
perform or conduct any environmental sampling or testing at, in, on, around or
underneath the Auctioned Assets and (III) Seller shall not be required to
provide such access or information with respect to any Retained Asset or
Retained Liabilities.
(b) Unless otherwise agreed to in writing by Buyer, Seller shall,
for a period commencing on the Closing Date and terminating three years after
the Closing Date, keep confidential and shall cause its representatives to keep
confidential all Confidential Information (as defined in the Confidentiality
Agreement) on the terms set forth in the Confidentiality Agreement. Except as
contemplated by the following sentence, Seller shall not release any person from
any confidentiality agreement now existing with respect solely to the Auctioned
Assets or waive or amend any provision thereof. After the Closing Date, upon
reasonable request of Buyer, Seller shall, to the maximum extent permitted by
law and the applicable Bidder Confidentiality Agreement (as defined below),
appoint Buyer to be Seller's representative and agent in respect of confidential
information relating to the Auctioned Assets under the confidentiality
agreements ("Bidder Confidentiality Agreements") between Seller and prospective
purchasers of certain generation assets of Seller of which the Auctioned Assets
form part.
(c) From and after the Closing Date, Buyer shall retain all
Operating Records (whether in electronic form or otherwise) relating to the
Auctioned Assets on or prior to the Closing Date. Buyer also agrees that, from
and after the Closing Date, Seller shall have the right, upon reasonable request
to Buyer, to receive from Buyer copies of any Operating Records or other
information in Buyer's possession relating to the Auctioned Assets on or prior
to the Closing Date and required by Seller in order to comply with applicable
law. Seller shall reimburse Buyer for its
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reasonable costs and expenses incurred in connection with the foregoing
sentence.
SECTION 7.03. Consents and Approvals; Transferable Permits. (a)
Seller and Buyer shall cooperate with each other and (i) prepare and file (or
otherwise effect) as soon as practicable all applications, notices, petitions
and filings with respect to and (ii) use their reasonable best efforts
(including negotiating in good faith modifications and amendments to this
Agreement and the Ancillary Agreements) to obtain (A) the Seller Required
Regulatory Approvals and the Buyer Required Regulatory Approvals and (B) any
other consents, approvals or authorizations of any other Governmental
Authorities or third parties that are necessary to consummate the transactions
contemplated by this Agreement or the Ancillary Agreements. Without limiting the
generality of the foregoing, (1) each Party agrees to, upon the other Party's
request, support such other Party's applications for regulatory approvals of the
purchase and sale of the Auctioned Assets contemplated by this Agreement, (2)
Buyer agrees not to seek any relief from, or modifications or amendments in
respect of, any bid cap, price limitation or other market power mitigation
measure or other restriction with respect to any power generation operations and
assets described in or contemplated by Section 6.03(b)(iii)(B) (2) until after
the Closing Date and (3) Buyer and Seller agree to defend any lawsuits or other
legal proceedings, whether judicial or administrative, challenging this
Agreement or the Ancillary Agreements, or the consummation of the transactions
contemplated hereby or thereby, including seeking to have any stay or temporary
restraining order entered by any Governmental Authority vacated or reversed.
(b) Upon execution of this Agreement, Seller shall commence the
process of transferring to Buyer the Transferable Permits, including completing
and filing applications and related documents with the appropriate Governmental
Authorities. Seller hereby reserves the right to modify, alter or amend any
Transferable Permit or to refuse to correct violations or deficiencies in
respect of any Transferable Permit as long as such modification, alteration,
amendment or refusal would not, individually or in the aggregate, create a
Material Adverse Effect. Seller shall use its reasonable best efforts to give
notice to Buyer of any modification, alteration or amendment to any Transferable
Permit.
(c) Seller shall use its reasonable best efforts to cooperate with
Buyer in the transfer of Transferable Permits to Buyer by Closing. If the
transfer of any
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Transferable Permit cannot be completed by Closing, Buyer is hereby authorized,
but not required, to act as Seller's representative and agent in respect of such
Transferable Permit and to do all things necessary for effecting transfer of
such Transferable Permit as soon after the Closing as is practicable, with
Seller remaining the Transferable Permit "holder of record" in such case until
such transfer is completed. In the case of each such Transferable Permit, Seller
shall, to the maximum extent permitted by law and such Transferable Permit,
enter into such reasonable arrangements with Buyer as are necessary to provide
Buyer with the benefits and obligations of such Transferable Permit. If Buyer is
able to complete the transfer of any Transferable Permit after Closing without
the occurrence of any event that, if such event had occurred between the
execution of this Agreement and the Closing, would have created, individually or
in the aggregate, a Material Adverse Effect, Seller may substitute Buyer in its
place and stead as the Party responsible for completing the transfer of such
Transferable Permit.
SECTION 7.04. Further Assurances. (a) Subject to the terms and
conditions of this Agreement, each of the Parties will use its reasonable best
efforts to take, or cause to be taken, as soon as possible, all action, and to
do, or cause to be done, as soon as possible, all things necessary, proper or
advisable under applicable laws and regulations to consummate the sale of the
Auctioned Assets pursuant to this Agreement as soon as possible, including using
its reasonable best efforts to ensure satisfaction of the conditions precedent
to each Party's obligations hereunder. Prior to Buyer's submission of any
application with a Governmental Authority for a regulatory approval, Buyer shall
submit such application to Seller for review and comment and Buyer shall
incorporate into such application any revisions reasonably requested by Seller.
Neither of the Parties will, without prior written consent of the other Party,
take or fail to take, or permit their respective Affiliates to take or fail to
take, any action, which would reasonably be expected to prevent or materially
impede, interfere with or delay the consummation, as soon as possible, of the
transactions contemplated by this Agreement or the Ancillary Agreements. Without
limiting the generality of the foregoing, each of the Parties shall use its
reasonable best efforts to negotiate in good faith as soon as possible after the
date of this Agreement, and enter into (i) the A-0 License and the A-10 License,
the terms of which shall be substantially as set forth in Exhibits H and F,
respectively, (ii) to the extent required to achieve subdivision of the Astoria
site, one or more contracts, agreements or other arrangements satisfactory to
the New
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York City Fire Department regarding fire prevention at the Astoria site and
(iii) any other agreement reasonably necessary to consummate the sale of the
Auctioned Assets pursuant to this Agreement as soon as possible.
(b) From time to time after the date hereof, without further
consideration and at its own expense, (i) Seller will execute and deliver such
instruments of assignment or conveyance as Buyer may reasonably request to more
effectively vest in Buyer Seller's title to the Auctioned Assets (subject to
Permitted Exceptions and the other terms of this Agreement) and (ii) Buyer will
execute and deliver such instruments of assumption as Seller may reasonably
request in order to more effectively consummate the sale of the Auctioned Assets
and the assumption of the Assumed Obligations pursuant to this Agreement.
(c) Seller shall not, and shall use its reasonable best efforts to
cause its Affiliates not to, sponsor or support any recommendation or
application to effect prior to April 1, 2002 (i) a reduction in the locational
generation capacity requirement that 80% of New York City peak electric loads
must be met with in-City generation capacity, as in effect as of the date of
this Agreement, unless such reduction is justified by a significant change in
the transmission import capability into New York City whether as a result of
actions by Seller or others, (ii) a reduction in the $105/kW-year bid and price
cap in respect of capacity under the Mitigation Measures, as in effect as of the
date of this Agreement or (iii) a change in the method of determining required
system capability set forth in NYPP Billing Procedure 4-11 (Installed Reserve
Requirements), as in effect as of the date of this Agreement that would reduce
the installed reserve requirements for the winter capability period applicable
to summer peaking systems if such reduction would also reduce the annual price
for installed capacity that Buyer could otherwise obtain.
(d) Seller shall join or support Buyer's application to the PSC for
the certification required under Section 32(c) of the Public Utility Holding
Company Act of 1935 in order for Buyer to obtain qualification, with respect to
the Auctioned Assets, as an exempt wholesale generator under the Energy Policy
Act of 1992.
(e) Seller and Buyer shall cooperate in good faith to establish a
transition committee to consider operational and business issues related to the
purchase and sale of the Auctioned Assets.
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(f) Prior to the Closing Date, Seller shall cooperate in good faith
with Buyer to enable Buyer to obtain insurance in respect of the Auctioned
Assets comparable to that maintained by Seller as of the date of this Agreement.
(g) Seller and Buyer shall cooperate in good faith to enable Buyer
to obtain fuel storage capacity with respect to the Auctioned Assets.
SECTION 7.05. Public Statements. The Parties shall consult with each
other prior to issuing any public announcement, statement or other disclosure
with respect to this Agreement, the Ancillary Agreements or the transactions
contemplated hereby or thereby, including any statement appearing in any filing
contemplated hereby or thereby, and shall not issue any such public
announcement, statement or other disclosure prior to such consultation, except
as may be required by law.
SECTION 7.06. Tax Matters. (a) All transfer and sales taxes
(including any petroleum business taxes and similar excise taxes on sales of
petroleum based products) incurred in connection with this Agreement and the
transactions contemplated hereby shall be borne by Buyer. Buyer shall prepare
and file in a timely manner any and all Tax Returns or other documentation
relating to such taxes; provided, however, that, to the extent required by
applicable law, Seller will join in the execution of any such Tax Returns or
other documentation relating to any such taxes. Buyer shall provide to Seller
copies of each Tax Return described in the proviso in the preceding sentence at
least 30 days prior to the date such Tax Return is required to be filed.
(b) At Seller's election, but on no less than 10 Business Days'
notice to Buyer, the transfer of the Auctioned Assets and the receipt of the
Purchase Price shall be made through a qualified intermediary in a manner
satisfying the requirements of Treasury Regulation Section 1.1031(k)-1(g), so
long as such election by Seller does not create a Material Adverse Effect and
Seller indemnifies Buyer for its additional costs and expenses incurred by
reason of such election.
(c) Each Party shall provide the other Party with such assistance as
may reasonably be requested by the other Party in connection with the
preparation of any Tax Return, any audit or other examination by any taxing
authority, or any judicial or administrative proceedings relating to liability
for Taxes, and each Party shall retain and provide the other Party with any
records or information which may be
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relevant to such return, audit, examination or proceedings. Any information
obtained pursuant to this Section 7.06 (c) or pursuant to any other Section
hereof providing for the sharing of information or review of any Tax Return or
other instrument relating to Taxes shall be kept confidential by the parties
hereto.
(d) If either Buyer or Seller receives a refund of Taxes in respect
of the Auctioned Assets for a taxable period including the Closing Date, Buyer
shall pay to Seller the portion of any such refund attributable to the portion
of such taxable period prior to the Closing Date, and Seller shall pay to Buyer
the portion of any such refund attributable to the portion of such taxable
period on and after the Closing Date.
SECTION 7.07. Bulk Sales or Transfer Laws. Buyer acknowledges that
Seller will not comply with the provisions of any bulk sales or transfer laws of
any jurisdiction in connection with the transactions contemplated by this
Agreement. Buyer hereby waives compliance by Seller with the provisions of the
bulk sales or transfer laws of all applicable jurisdictions.
SECTION 7.08. Storage. Seller shall store for Buyer the Auctioned
Assets described in the second sentence of Section 2.01 until the date that is
six months after the Closing Date or, in respect of all or a portion of such
Auctioned Assets, until one or more earlier dates proposed by Buyer with
reasonable advance notice, which schedule shall be reasonably acceptable to
Seller. Buyer agrees to reimburse Seller for its reasonable costs and expenses
in connection with such storage. Buyer agrees that Seller shall have no
responsibility or liability for the actual removal of such Auctioned Assets from
the actual storage location, and that Buyer shall have sole responsibility
therefor. Notwithstanding the provisions of Section 10.01, Buyer agrees that
Seller shall have no liability for loss or damage with respect to the matters
contemplated by this Section 7.08 or such Auctioned Assets, and Buyer agrees to
hold each Seller Indemnitee harmless from and against all loss or damage or
Indemnifiable Losses, and to indemnify each Seller Indemnitee from and against
all loss or damage or Indemnifiable Losses incurred, asserted against or
suffered as a result of any storage or other services provided by Seller
pursuant to this Section 7.08, in each case, except to the extent any such loss
or damage or Indemnifiable Loss results in whole or in part from the gross
negligence or wilful or wanton acts or omissions to act of any Seller Indemnitee
(or any contractor or subcontractor of Seller).
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SECTION 7.09. Information Resources. From the Closing Date until the
date that is three months thereafter, Seller shall provide Buyer with access to
Seller's mainframe computer only to the extent reasonably necessary to enable
Buyer to use the PPMIS and MMS (in read only mode) systems and applications
solely in connection with the Auctioned Assets. Buyer agrees that it will not
use any such access for any purpose other than for the use of the PPMIS and MMS
systems and applications solely in connection with the Auctioned Assets. Buyer
acknowledges that, as long as it retains access to Seller's mainframe computer,
Seller, its employees and third parties may have access to Buyer's information
resources systems and applications (including the PPMIS and MMS systems and
applications served by Seller's mainframe computer) . Notwithstanding the
provisions of Section 10.01, Buyer agrees that Seller shall have no liability or
obligation whatsoever with respect to the matters contemplated by this Section
7.09, and Buyer agrees to hold each Seller Indemnitee harmless from and against
all loss or damage or Indemnifiable Losses, and to indemnify each Seller
Indemnitee from and against all loss or damage or Indemnifiable Losses incurred,
asserted against or suffered as a result of Buyer's access to Seller's mainframe
computer pursuant to this Section 7.09, in each case, except to the extent any
such loss or damage or Indemnifiable Loss results in whole or in part from the
gross negligence or wilful or wanton acts or omissions to act of any Seller
Indemnitee (or any contractor or subcontractor of Seller).
SECTION 7.10. Witness Services. At all times from and after the
Closing Date, each Party shall use reasonable best efforts to make available to
the other Party, upon reasonable written request, its and its subsidiaries' then
current or former officers, directors, employees (including former employees of
Seller) and agents as witnesses to the extent that (i) such persons may
reasonably be required by such requesting Party in connection with any claim,
action, proceeding or investigation in which such requesting Party may be
involved and (ii) there is no conflict between Buyer and Seller in such claim,
action, proceeding or investigation. Such other Party shall be entitled to
receive from such requesting Party, upon the presentation of invoices for such
witness services, payments for such amounts, relating to supplies, disbursements
and other out-of-pocket expenses and direct and indirect costs of employees who
are witnesses, as may be reasonably incurred in providing such witness services.
SECTION 7.11. Consent Orders. Buyer and Seller agree to cooperate
with each other and NYSDEC to facilitate
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the entry of a consent order between NYSDEC and Buyer, wherein Buyer will agree
to assume and perform the Assumed Consent Order Obligations.
SECTION 7.12. Nitrogen Oxide Allowances. Seller agrees to negotiate
in good faith with NYSDEC for nitrogen oxide allowances to be allocated to the
Auctioned Assets for any period subsequent to the year 2002.
SECTION 7.13. Trade Names. Seller shall not object to the use by
Buyer of any trade names, trademarks, service marks or logos (and any rights to
and in the same, including any right to use the same) primarily relating to the
Generating Facilities that contain the words "Astoria", "Gowanus" or "Narrows".
SECTION 7.14. NYPA Agreements. (a) Seller shall, to the maximum
extent permitted by law and the NYPA Agreements, enter into such reasonable
arrangements with Buyer as are necessary to provide Buyer with the benefits of
Seller's rights and interests under the NYPA Agreements relating to the
Auctioned Assets and set forth on Schedule 7.14.
(b) Buyer hereby acknowledges that Seller has provided it with
copies of the NYPA Agreements.
SECTION 7.15. Narrows. From the date of this Agreement to the
Closing and notwithstanding anything to the contrary contained in Section 7.01,
Seller shall use its reasonable best efforts to obtain in the following order of
preference (a)(i) fee title, or (ii) a permanent easement to maintain and
operate the existing Narrows Gas Turbines (the "Narrows Turbines") at the
Narrows Gas Turbine Site in a manner consistent with the operation by Seller of
the Narrows Turbines in the past or (b) if the options in clause (a) above are
not capable of being obtained within a reasonable period (which period may run
prior to Closing) a long term lease with a lease term of not less than 20 years
having terms reasonably satisfactory to Buyer that will permit the maintenance
and operation of the Narrows Turbines at the Narrows Gas Turbine Site in a
manner consistent with the operation by Seller of the Narrows Turbines in the
past, in each case in respect of that real property described on Schedule 7.15.
From the Closing until the third anniversary of the date of this Agreement,
Buyer shall, at its election, either (x) take over Seller's efforts to obtain
such fee title, easement or long term lease (and in such event Buyer shall keep
Seller informed of its efforts, consult with Seller in its efforts and act in a
commercially reasonable manner in its efforts) and, in the event Buyer has taken
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over the efforts referred to above, Seller shall reimburse Buyer for its
reasonable costs and expenses incurred in pursuing such efforts, or (y) require
Seller to continue to use its reasonable best efforts to obtain such fee title,
easement or long term lease. The amounts paid or payable to obtain such fee
title, easement or long term lease shall be the responsibility of Seller;
provided, however, that the amounts payable by Seller under this Section 7.15,
including by way of reimbursement to Buyer, shall not exceed $5 million in the
aggregate. Seller's obligations under this Section 7.15 shall cease in all
respects upon such third anniversary.
ARTICLE VIII
Conditions
SECTION 8.01. Conditions Precedent to Each Party's Obligation To
Effect the Purchase and Sale. The respective obligations of each Party to effect
the purchase and sale of the Auctioned Assets shall be subject to the
satisfaction or waiver by such Party on or prior to the Closing Date of the
following conditions, unless, in the case of Section 8.01(c) below, the PSC
determines that such condition need not be included or complied with:
(a) the Seller Required Regulatory Approvals and Buyer Required
Regulatory Approvals, other than the Revocable Consent, shall have been
obtained and all conditions to effectiveness prescribed therein or
otherwise by law, regulation or order shall have been satisfied; provided,
however, that if at the time any Seller Required Regulatory Approval or
Buyer Required Regulatory Approval is obtained, a Party reasonably expects
a request for rehearing or a challenge thereto to be filed or if a request
for rehearing or a challenge thereto has been filed, in each case, which,
if successful, would cause such Seller Required Regulatory Approval or
Buyer Required Regulatory Approval, as the case may be, to be reversed,
stayed, enjoined, set aside, annulled, suspended or substantially
modified, then such Party may by notice to the other Party within five
Business Days after receipt of such Seller Required Regulatory Approval or
Buyer Required Regulatory Approval, as the case may be, delay the Closing
until the time for requesting rehearing has expired or until such
challenge is decided, in each case, whether or not any appeal thereof is
pending; provided further, however, that if the Closing is delayed
pursuant to the foregoing
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provision, the Termination Date shall be automatically extended for a
period of time equal to the period of such delay;
(b) no preliminary or permanent injunction or other order or decree
by any Federal or state court of competent jurisdiction and no statute or
regulation enacted by any Governmental Authority prohibiting the
consummation of the purchase and sale of the Auctioned Assets
(collectively, "Restraints") shall be in effect;
(c) the ISO shall have become operational to the extent reasonably
necessary to monitor market power in respect of the Auctioned Assets; and
(d) delivery of each Continuing Site Agreement, each Declaration of
Easements Agreement, each Declaration of Subdivision Easements and each
Zoning Lot Development Agreement to the Title Company for recording.
SECTION 8.02. Conditions Precedent to Obligation of Buyer To Effect
the Purchase and Sale. The obligation of Buyer to effect the purchase and sale
of the Auctioned Assets contemplated by this Agreement shall be subject to the
satisfaction or waiver by Buyer on or prior to the Closing Date of the following
additional conditions:
(a) Seller shall have performed in all material respects its
covenants and agreements contained in this Agreement which are required to
be performed on or prior to the Closing Date;
(b) the representations and warranties of Seller which are set forth
in this Agreement shall be true and correct as of the date of this
Agreement and as of the Closing Date, as if made at and as of such time
(except to the extent expressly made as of an earlier date, in which case
as of such date), except where the failure of such representations and
warranties to be so true and correct (without giving effect to any
limitation as to "materiality" or "Material Adverse Effect" set forth
therein) would not, individually or in the aggregate, create a Material
Adverse Effect;
(c) Buyer shall have received a certificate from an authorized
officer of Seller, dated the Closing Date, to the effect that, to the best
of such officer's knowledge, the conditions set forth in Sections 8.02 (a)
and (b) have been satisfied;
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(d) all material Permits and Environmental Permits required for
Buyer to conduct the business and operations of the Auctioned Assets as
currently conducted shall have been transferred or will be transferable to
Buyer, or shall have been obtained or will be obtainable by Buyer, or
shall have been made available to Buyer in accordance with Section
7.03(c), on, prior to or within a reasonable period of time after the
Closing Date;
(e) Buyer shall have received (i) the deeds of conveyance
substantially in the form of Exhibits B-1 and B-2, respectively, (ii) a
Foreign Investment in Real Property Tax Act Certification and Affidavit
substantially in the form of Exhibit C and (iii) an opinion from John D.
McMahon, Esq., General Counsel of Seller or other counsel reasonably
acceptable to Buyer, dated the Closing Date, substantially in the form set
forth in Exhibit D;
(f) execution and delivery by Seller of each of (i) the Transition
Capacity Agreement and the Zoning Lot Development Agreements and (ii) the
A-10 License and the A-0 License, each in a form reasonably satisfactory
to Buyer;
(g) the Title Company shall be willing to issue to Buyer a New York
form of ALTA (1992) Owner's Title Insurance Policy insuring fee title to
the Buyer Real Estate in an amount equal to that portion of the Purchase
Price properly allocable to Buyer Real Estate, subject only to the
Permitted Exceptions;
(h) Buyer shall have received originals of the ALTA/ACSM Land Title
Surveys which include the Buyer Real Estate in addition to other property,
signed by the surveyor with Buyer's name and the name of not more than one
other Party designated by Buyer added to the certification set forth
thereon; and
(i)(x) There shall not be any New York State Governmental Authority
with jurisdiction seeking to prevent Buyer from operating the Narrows Turbines
on the Narrows Gas Turbine Site in a manner consistent with the operation of the
Narrows Turbines by Seller in the past as a result of the state of title in
respect of the real property described in Schedule 7.15 and (y) if (x) is not
satisfied, the presence of the state of facts in (x) in and of itself and
without regard to any other facts or circumstances, will not have a reasonable
probability of materially and adversely affecting Buyer's ability to obtain
financing for the
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acquisition of the Auctioned Assets (it being understood that the obtaining of a
"use permit" or equivalent Permit from the appropriate Governmental Authority in
form and substance reasonably satisfactory to Buyer in respect of such real
property and the Narrows Turbines by Buyer shall satisfy this condition and the
obtaining of fee title, an easement or long term lease satisfying the
requirements of Section 7.15 shall also satisfy such condition).
SECTION 8.03. Conditions Precedent to Obligation of Seller To Effect
the Purchase and Sale. The obligation of Seller to effect the purchase and the
sale of the Auctioned Assets contemplated by this Agreement shall be subject to
the satisfaction or waiver by Seller on or prior to the Closing Date of the
following additional conditions:
(a) Buyer shall have performed in all material respects its
covenants and agreements contained in this Agreement which are required to
be performed on or prior to the Closing Date;
(b) the representations and warranties of Buyer which are set forth
in this Agreement shall be true and correct as of the date of this
Agreement and as of the Closing Date, as if made at and as of such time
(except to the extent expressly made as of an earlier date, in which case
as of such date), except where the failure of such representations and
warranties to be so true and correct (without giving effect to any
limitation as to "materiality" or "Buyer Material Adverse Effect" set
forth therein) would not, individually or in the aggregate, create a Buyer
Material Adverse Effect;
(c) Seller shall have received a certificate from an authorized
officer of Buyer, dated the Closing Date, to the effect that, to the best
of such officer's knowledge, the conditions set forth in Sections 8.03 (a)
and (b) have been satisfied;
(d) Seller shall have received an opinion substantially in the form
of Exhibit E dated as of the Closing Date and from counsel reasonably
acceptable to Seller;
(e) execution and delivery by Buyer of each of (i) Transition
Capacity Agreement, the Gowanus Zoning Lot Development Agreement and,
unless executed and delivered prior to the Closing Date, the Astoria
Zoning Lot Development Agreement and (ii) the A-10 License and the A-0
License, each in a form reasonably satisfactory to Seller;
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(f) Buyer shall have provided evidence in form and substance
reasonably satisfactory to Seller of compliance by Buyer with its
obligations under Article IX;
(g) the Guarantee Agreement shall be in full force and effect;
(h) Guarantor shall have performed in all material respects its
covenants and agreements contained in the Guarantee Agreement which are
required to be performed on or prior to the Closing Date;
(i) the representations and warranties of Guarantor which are set
forth in the Guarantee Agreement shall be true and correct as of the date
of the Guarantee Agreement and as of the Closing Date, as if made at and
as of such time (except to the extent expressly made as of an earlier
date, in which case as of such date), except where the failure of such
representations and warranties to be so true and correct (without giving
effect to any limitation as to "materiality" or "Guarantor Material
Adverse Effect" set forth therein) would not, individually or in the
aggregate, create a Guarantor Material Adverse Effect (as defined
therein);
(j) Seller shall have received a certificate from an authorized
officer of Guarantor, dated the Closing Date, to the effect that, to the
best of such officer's knowledge, the conditions set forth in Sections
8.03(h) and (i) have been satisfied; and
(k) Seller shall have received an opinion substantially in the form
of Exhibit L dated the Closing Date and from counsel reasonably acceptable
to Seller.
ARTICLE IX
Employee Matters
SECTION 9.01. Employee Matters. (a) Buyer shall offer equivalent
employment at the Auctioned Assets to those employees of Seller regularly
assigned by Seller to work at the Auctioned Assets on the Closing Date in the
job titles and facilities listed in Schedule 9.01(a) (all such employees
described above and those individuals described in the following sentence being
hereinafter referred to as "Affected Employees"). Affected Employees include
each such
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employee of Seller who is not actively at work on the Closing Date due solely to
a temporary short-term absence, whether paid or unpaid, in accordance with
applicable policies of Seller, including as a result of vacation, holiday,
personal time, leave of absence, union leave, short- or long-term disability
leave, military leave or jury duty. Affected Employees whether or not they
accept an offer of employment from Buyer shall cease to be employees of Seller
on the Closing Date and, to the extent they accept an offer of employment from
Buyer, their period of employment by Buyer shall begin on the Closing Date.
Seller shall be responsible for any obligation to provide employee benefits to
an Affected Employee prior to such employee's period of employment by Buyer.
All such offers of employment will be made (x) in accordance with
all applicable laws and regulations, and (y) for employees represented by
Utility Workers' Union of America AFL-CIO and its Local Union 1-2 ("Local 1-2"),
in accordance with the Local 1-2 Collective Bargaining Agreement (as defined in
Schedule 9.01(b)). Each Affected Employee who becomes employed by Buyer pursuant
to this Section 9.01(a) shall be referred to herein as a "Continued Employee".
Buyer may commence discussions concerning offers for employment
beginning on the Closing Date to Affected Employees at any time following the
date of this Agreement.
Seller acknowledges and agrees that Buyer may discharge any of its
obligations under this Article IX through one of its Affiliates; provided,
however, that Buyer shall in no event be relieved from the full liabilities and
the full financial responsibility under this Article IX.
(b) Schedule 9.01(b) sets forth the collective bargaining agreement,
and amendments thereto, to which Seller is a party in connection with the
Auctioned Assets (the "Collective Bargaining Agreement"). Affected Employees who
are included in the collective bargaining unit covered by the Collective
Bargaining Agreement are referred to herein as "Affected Union Employees". Each
Continued Employee who is an Affected Union Employee shall be referred to herein
as a "Continued Union Employee". On the Closing Date, Buyer will assume the
terms and conditions of the Collective Bargaining Agreement, except as set forth
in Section 9.02 (b) below, as it relates to Affected Union Employees until the
expiration date of the Collective Bargaining Agreement. Buyer will comply with
its legal obligations with respect to collective bargaining under Federal labor
law for the employees at the Auctioned Assets
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in the job titles or related work responsibilities of the Affected Union
Employees, and Buyer will comply with all applicable obligations thereunder as
the new owner of the Auctioned Assets. Buyer shall recognize Local 1-2 as the
exclusive collective bargaining representative of the employees at the Auctioned
Assets in the job titles or related work responsibilities of the Affected Union
Employees and Buyer agrees that, should any other business entity (regardless of
its relationship to Buyer) acquire all or a portion of the Auctioned Assets from
Buyer prior to the expiration date of the Collective Bargaining Agreement, Buyer
will require such business entity to (i) offer employment to Affected Union
Employees employed by Buyer at the Auctioned Assets immediately prior to the
change in ownership, (ii) recognize Local 1-2 as the exclusive collective
bargaining representative of Buyer's employees at the Auctioned Assets in the
job titles and work responsibilities of the Affected Union Employees, and (iii)
assume the terms and conditions of the Collective Bargaining Agreement as they
relate to Affected Union Employees from the date of such acquisition through the
expiration date of the Collective Bargaining Agreement.
SECTION 9.02. Continuation of Equivalent Benefit Plans/Credited
Service. (a) For not less than three years following the Closing Date, Buyer
shall maintain compensation (including base pay and bonus compensation) and
employee benefits and employee benefit plans and arrangements for each Continued
Employee who is not a Continued Union Employee (a "Continued Non-Union
Employee") which are at least equivalent to those provided pursuant to the
compensation, employee benefits and employee benefit plans and arrangements in
effect on the Closing Date for the Affected Employees who are not Affected Union
Employees. Such total compensation shall be based upon (x) such employee's
existing individual base pay, (y) such employee's authorized overtime, if
applicable, and (z) the average bonus and benefit component for such employee's
salary plan level, as consistently applied by Seller, apportioned according to
such employee's base pay. No provision of this Agreement shall affect any
Continued Non-Union Employee's status as an employee-at-will.
(b) From the Closing Date until the expiration date of the
Collective Bargaining Agreement, Buyer shall provide to each Continued Union
Employee benefits and employee benefit plans and arrangements which are
equivalent to those provided under such Collective Bargaining Agreement. Such
benefits, plans and arrangements include the following: (i) hospital, medical,
dental, vision care and prescription drug benefits (including employee
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contributions to be made on a pre-tax basis), (ii) health care and dependent
care flexible spending accounts; (iii) employer-provided basic group term life
and accidental death and dismemberment insurance; (iv) employee-paid group
universal life and spousal and dependent child life insurance; (v) sick
allowance (short term disability) and long term disability benefits; (vi)
business travel accident insurance and crime protection insurance; (vii)
occupational accidental death insurance; (viii) adoption benefits and child care
and elder care referral benefits; (ix) tuition aid benefits; (x) vacation and
holidays; (xi) employee stock purchase plan (including employer matching
contributions) and (xii) defined benefit pension and 401(k) plan benefits. In
providing such benefits, Buyer shall have the right, subject to any applicable
laws, to use different providers from those used by Seller and to establish
Buyer's own benefit plans or use Buyer's existing benefit plans. For purposes
hereof, except as provided in Section 9.04(b), Buyer shall have no obligation to
maintain a fund holding or measured by common stock of Seller's parent under any
of Buyer's plans or arrangements, notwithstanding any such fund maintained by
Seller under its plans and arrangements.
(c) Continued Employees shall be given credit by Buyer for all
service with Seller and its Affiliates under all existing or future employee
benefit and fringe benefit plans, programs and arrangements of the Buyer ("Buyer
Benefit Plans") in which they become participants. The service credit given by
Buyer shall be for purposes of eligibility, vesting, eligibility for early
retirement and early retirement subsidies, benefit accrual and service-related
level of benefits. Buyer shall assume and honor all vacation, sick and personal
days accrued and unused by Continued Employees through the Closing Date in
accordance with Seller's applicable policies and arrangements.
SECTION 9.03. Pension Plan. (a) Effective as of the Closing Date,
Buyer shall have in effect defined benefit pension plans ("Buyer's Pension
Plans") intended to be (i) qualified pursuant to Section 401(a) of the Code and
(ii) nonqualified, in order to provide for benefits which would otherwise be
payable under the applicable qualified plan but for the application of Sections
401(a)(17) and 415 of the Code, providing benefits as of the Closing Date
identical in all material respects (except for such changes as may be required
by law) to the benefits provided to them under Seller's Pension Plans (as
defined below), in particular (x) for Continued Non-Union Employees, such
Buyer's Pension Plans to provide benefits identical in all material respects to
those benefits provided under Seller's Retirement Plan for Management Employees
and Seller's
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Supplemental Retirement Income Plan, and (y) for Continued Union Employees, such
Buyer's Pension Plans to provide benefits identical in all material respects to
those provided under Seller's Pension and Benefits Plan (collectively, "Seller's
Pension Plans"), in each case, as of the Closing Date. Buyer acknowledges and
agrees that one such material respect is to count age after termination of
employment for purposes of satisfying requirements for early retirement
eligibility and early retirement subsidies.
(b) Continued Employees participating in Seller's Pension Plans
immediately prior to the Closing Date shall become participants in Buyer's
Pension Plans as of the Closing Date. Without limiting the generality of Section
9.02(c), Continued Employees shall receive credit for all compensation and
service with Seller (subject to the terms of Seller's Pension Plans) for
purposes of eligibility for participation, vesting, eligibility for early
retirement and early retirement subsidies and benefit accrual under Buyer's
Pension Plans. Seller shall be responsible for Continued Employees' pension
benefits accrued up to the Closing Date, and Buyer shall be responsible for
pension benefits accrued by such Continued Employees on and after the Closing
Date as provided herein. Buyer may offset against the accrued benefits
determined under Buyer's Pension Plans the accrued benefits determined under
Seller's Pension Plans. For the purpose of this Section 9.03(b), "accrued
benefit" means the amount that would be paid as a life annuity at normal
retirement age irrespective of the date of actual distribution from either
Seller's or Buyer's Pension Plans. Seller shall make pension distributions to
Continued Employees of the vested portion of their accrued benefits in
accordance with the terms of Seller's Pension Plans as in effect from time to
time. As soon as reasonably practicable following the Closing Date, Seller shall
provide Buyer a list showing, as of the Closing Date, the accrued benefit of
each Continued Employee under Seller's Pension Plans.
(c) In the event that any other business entity (regardless of its
relationship to Buyer) acquires all or a portion of the Auctioned Assets from
Buyer at any time prior to the third anniversary of the Closing Date in the case
of Continued Non-Union Employees and prior to the expiration date of the
Collective Bargaining Agreement in the case of Continued Union Employees, Buyer
will require such entity to maintain the defined benefit plans, provide the
benefits and recognize compensation and service with Seller and Buyer to the
same extent as Buyer is required under Sections 9.03 (a) and (b) above.
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SECTION 9.04. 401(k) Plan. (a) Effective as of the Closing Date,
Buyer shall have in effect tax-qualified defined contribution plans that include
a qualified cash or deferred arrangement within the meaning of Section 401(k) of
the Code ("Buyer's 401(k) Plans") that will provide benefits that are identical
in all material respects (except for such changes as may be required by law) to
those provided by (i) Seller's Thrift Savings Plan for Management Employees, in
the case of Continued Non-Union Employees, and (ii) Seller's Retirement Income
Savings Plan for Weekly Employees, in the case of Continued Union Employees
(such Seller plans herein referred to collectively as "Seller's 401(k) Plans"),
in each case, as of the Closing Date. Each Continued Employee participating in
Seller's 401(k) Plans immediately prior to the Closing Date shall become a
participant in Buyer's 401(k) Plans as of the Closing Date. Continued Employees
shall receive credit for all service with Seller for purposes of eligibility and
vesting under Buyer's 401(k) Plans.
(b) At such time after the Closing Date as Seller is reasonably
satisfied that Buyer's 401(k) Plans meet the requirements for qualification
under Section 401(a) of the Code, Seller shall cause to be transferred to
Buyer's 401(k) Plans in a trust-to-trust transfer in common stock of Seller's
parent (as provided in the following sentence) and cash (or other property
reasonably acceptable to Buyer) an amount equal to the value of the assets held
in the accounts of all Continued Employees (including any outstanding loan
balances of Continued Employees in Seller's 401(k) Plans), subject to any
qualified domestic relations orders. In connection therewith, Buyer shall
establish an investment fund under Buyer's 401(k) Plans to which shall be
transferred the shares of common stock of Seller's parent (or any successor
thereto) which, as of the date of transfer, are credited to the accounts of the
Continued Employees under Seller's 401(k) Plans. After the Closing Date and
prior to any such transfer, Buyer shall cooperate with Seller in the
administration of distributions to and loan repayments by Continued Employees.
Prior to such transfer of assets, Seller shall vest any unvested benefits of
Continued Employees under Seller's 401(k) Plans. Following any such transfer of
assets, Buyer shall assume all obligations and liabilities of Seller under
Seller's 401(k) Plans with respect to such Continued Employees, and Seller shall
have no further liability to Buyer or any Continued Employee with respect
thereto.
SECTION 9.05. Welfare Plans. (a) Continued Employees and their
dependents who are eligible to participate in Seller's current welfare benefits
plans,
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programs or arrangements shall be eligible to participate in the welfare
benefits plans, programs or arrangements maintained or established by Buyer
("Buyer's Welfare Plans"), effective as of the Closing Date. Effective as of the
Closing Date, any and all limitations as to pre-existing conditions and
actively-at-work exclusions and waiting periods under Buyer's Welfare Plans
shall be waived by Buyer with respect to Continued Employees and their eligible
dependents to the extent satisfied under Seller's applicable Welfare Plans. In
addition, effective as of the Closing Date, Buyer shall cause Buyer's Welfare
Plans to recognize any out-of-pocket health care expenses incurred by Continued
Employees and their eligible dependents prior to the Closing Date and during the
calendar year in which such Closing Date occurs for purposes of determining
their deductibles and out-of-pocket maximums under Buyer's Welfare Plans. Seller
shall retain responsibility under Seller's welfare plans for claims relating to
expenses incurred by Continued Employees and their eligible dependents prior to
the Closing Date. Buyer shall have responsibility under Buyer's Welfare Plans
for claims relating to expenses incurred by Continued Employees and their
eligible dependents on and after the Closing Date.
(b) Effective as of the Closing Date, Buyer shall have in effect
health care and dependent care reimbursement account plans for the benefit of
each Continued Employee, the terms of which shall (i) be identical in all
material respects to the Flexible Reimbursement Account Plans for Management and
Weekly Employees of Seller ("Seller's Reimbursement Account Plans") as in effect
on the Closing Date and (ii) give full effect to, and continue in effect, salary
reduction elections made under Seller's Reimbursement Account Plans. Prior to
the Closing Date, Seller shall cause the accounts of Continued Employees under
Seller's Reimbursement Account Plans to be segregated into separate health care
and dependent care reimbursement accounts (the "Segregated Reimbursement
Accounts"), and such Segregated Reimbursement Accounts shall be transferred to
and assumed by Buyer as of the Closing Date.
(c) Buyer shall, subject to any applicable laws, provide a retiree
health program identical in all material respects to Seller's retiree health
program as in effect on the Closing Date to each Continued Employee who
terminates his employment with Buyer within three years after the Closing Date,
in the case of a Continued Non-Union Employee, and on or prior to the expiration
date of the Collective Bargaining Agreement, in the case of a Continued Union
Employee, and, in each case, who at the time of such termination of employment
satisfies the eligibility
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requirements for such retiree health program provided by Buyer; provided,
however, that Seller shall remain liable, pursuant to Seller's retiree health
program, for all Continued Employees who satisfy, as of the Closing Date, the
eligibility requirements then in effect for Seller's retiree health program.
SECTION 9.06. Short- and Long-Term Disability. Effective as of the
Closing Date, Buyer shall have in effect short- and long-term disability plans
for the benefit of Continued Employees, the cost of which to Continued Employees
shall be the same as under, and the terms of which are identical in all material
respects to, Seller's applicable plans as in effect as of the Closing Date. Any
and all waiting periods and pre-existing condition clauses shall be waived under
Buyer's short- and long-term disability plans with respect to Continued
Employees.
SECTION 9.07. Life Insurance and Accidental Death and Dismemberment
Insurance. Effective as of the Closing Date, Buyer shall have in effect group
term life insurance, group universal life insurance, accidental death and
dismemberment insurance, occupational accidental death insurance, business
travel accident insurance and crime protection insurance plans for the benefit
of Continued Employees, the cost of which to Continued Employees shall be the
same as under, and terms of which are identical in all material respects to,
Seller's applicable plans that provide such benefits to Continued Employees
immediately prior to the Closing Date.
SECTION 9.08. Severance. (a) Effective as of the Closing Date, Buyer
shall have in effect a severance plan covering Continued Non-Union Employees
that contains terms identical in all material respects to those under Seller's
Severance Pay Plan for Management Employees as of the Closing Date.
(b) Buyer shall, subject to any applicable laws, provide a special
separation allowance for any Continued Employee whose employment with Buyer is
terminated involuntarily by Buyer other than for cause on or prior to, in the
case of Continued Non-Union Employees, three years after the Closing Date and,
in the case of Continued Union Employees, the expiration date of the Collective
Bargaining Agreement. Such allowance shall be not less than the sum of four
weeks pay plus one week pay for each completed year of service (as determined by
aggregating each affected individual's respective service with Seller and Buyer)
and shall be payable by Buyer (to the extent not paid pursuant to any Buyer
severance plan referenced in Section 9.08 (a))
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in a lump sum within 30 days after termination of employment. In addition, in
the case of each Continued Non-Union Employee described in the first sentence of
this Section 9.08(b), Buyer shall pay (to the extent not paid pursuant to any
Buyer severance plan referenced in Section 9.08 (a)) the Continued Non-Union
Employee a lump sum equal to the excess of (i) the actuarial equivalent of the
Employee's "potential benefit" under the applicable Buyer's Pension Plans, which
such Employee would receive if such Employee's employment continued until three
years after the Closing Date and such Employee's base and incentive compensation
for such deemed additional period was the same as in effect on the date of such
Employee's termination of employment with Buyer, over (ii) the actuarial
equivalent of such Employee's "actual benefit" under the applicable Buyer's
Pension Plans, as of the date of such Employee's termination of employment from
Buyer. For the purpose of the foregoing sentence, (i) the term "potential
benefit" shall refer to the monthly pension that would have been payable to the
applicable Employee commencing on the first day of the month following the
latest of (A) the last day of the deemed additional period, (B) Employee's
attainment of age 55, or (C) the earlier of (1) the first date as of which the
sum of such Employee's age and years of service, as taken into account in
determining the actuarial reduction for commencement prior to normal retirement
age that is to be applied to his accrued benefit under the applicable Buyer's
Pension Plans, equals 75 or (2) such Employee's attainment of age 65, (ii) the
term "actual benefit" shall refer to the monthly pension payable to such
Employee under the applicable Buyer's Pension Plans commencing as of the date
determined in accordance with clause (i) of this sentence, and (iii) the
actuarial equivalent of the "potential benefit" and the "actual benefit" shall
each be a lump sum payable as of the date of such Employee's termination of
employment from Buyer, determined on the basis of the interest rate used to
determine the amount of lump sum distributions and, to the extent applicable,
other actuarial assumptions then in effect under the applicable Buyer's Pension
Plans. Buyer shall also provide outplacement services to such terminated
Continued Non-Union Employee appropriate to the level of the Employee's position
and job responsibilities. Buyer shall also continue to provide or cause to be
provided to any such terminated Continued Employee health insurance coverage and
group term and universal life insurance coverage at the same rates as for active
Continued Employees for a period equal to the number of weeks of separation
allowance which any such terminated Continued Employee is entitled to from
Buyer. Buyer shall have the right to require a release in form reasonably
satisfactory to Buyer as a condition for
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eligibility to receive such separation allowance. The allowance shall not apply
to Continued Employees whose employment is terminated due to death or expiration
of sick allowance or other authorized leave of absence or who terminate
employment voluntarily. If at any time during the three-year period following
the Closing Date, Buyer shall assign a Continued Non-Union Employee to work on a
regular basis at a location that is more than fifty miles from the location to
which such Employee is assigned as of the Closing Date, Buyer shall offer such
Employee the option to terminate employment and receive the severance benefits
set forth in this Section 9.08(b) in lieu of the reassignment.
SECTION 9.09. Workers Compensation. Effective as of the Closing
Date, Buyer shall have in effect a workers compensation program for Continued
Employees that shall provide coverage identical in all material respects to
Seller's workers compensation program as of the Closing Date.
ARTICLE X
Indemnification and Dispute Resolution
SECTION 10.01. Indemnification. (a) Seller will indemnify and hold
harmless Buyer and its Affiliates and their respective directors, officers,
employees and agents (collectively with Buyer and its Affiliates, the "Buyer
Indemnitees") from and against any and all claims, demands or suits by any
person, and all losses, liabilities, damages, obligations, payments, costs and
expenses (including reasonable legal fees and expenses and including costs and
expenses incurred in connection with investigations and settlement proceedings)
(each, an "Indemnifiable Loss"), as incurred, asserted against or suffered by
any Buyer Indemnitee relating to, resulting from or arising out of:
(i) any breach by Seller of any covenant or agreement of Seller
contained in this Agreement or, prior to their expiration in accordance
with Section 12.03, the representations and warranties contained in
Sections 5.01, 5.02, 5.03 and 5.17;
(ii) the Retained Liabilities;
(iii) noncompliance by Seller with any bulk sales or transfer laws
as provided in Section 7.07; or
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(iv) any breach by Seller of any Ancillary Agreement.
(b) Buyer will indemnify and hold harmless Seller and its Affiliates
and their respective directors, officers, trustees, employees and agents
(collectively with Seller and its Affiliates, the "Seller Indemnitees")
from and against any and all Indemnifiable Losses, as incurred, asserted
against or suffered by any Seller Indemnitee relating to, resulting from
or arising out of:
(i) any breach by Buyer of any covenant or agreement of Buyer
contained in this Agreement or, prior to their expiration in accordance
with Section 12.03, the representations and warranties contained in
Sections 601, 6.02, 6.03 and 6.05;
(ii) the Assumed Obligations;
(iii) any obligation resulting from any action or inaction of Buyer
(A) under any Contract or warranty pursuant to Section 2.04(b) (whether
acting as principal or representative and agent for Seller pursuant to
Section 2.04(b) or otherwise), (B) pursuant to Section 2.05 or Section
7.14 (in each case, whether acting as representative or agent for Seller
or otherwise) or (C) pursuant to any Transferable Permit in respect of
which Seller remains the holder of record after the Closing Date pursuant
to Section 7.03(c); or
(iv) any breach by Buyer of any Ancillary Agreement
(c) The amount of any Indemnifiable Loss shall be reduced to the
extent that the relevant Buyer Indemnitee or Seller Indemnitee (each, an
"Indemnitee") receives any insurance proceeds with respect to an Indemnifiable
Loss and shall be (i) increased to take account of any Tax Cost incurred by the
Indemnitee arising from the receipt of indemnity payments hereunder (grossed up
for such increase) and (ii) reduced to take account of any Tax Benefit realized
by the Indemnitee arising from the incurrence or payment of any such
Indemnifiable Loss. If the amount of any Indemnifiable Loss, at any time
subsequent to the making of an indemnity payment in respect thereof, is reduced
by recovery, settlement or otherwise under or pursuant to any insurance
coverage, or pursuant to any claim, recovery, settlement or payment by or
against any other person, the amount of such reduction, less any costs, expenses
or premiums incurred in connection therewith, will promptly be
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repaid by the Indemnitee to the Party required to provide indemnification
hereunder (the "Indemnifying Party") with respect to such Indemnifiable Loss.
(d) To the fullest extent permitted by law, neither Party nor any
Buyer Indemnitee or any Seller Indemnitee shall be liable to the other Party or
any other Buyer Indemnitee or Seller Indemnitee for any claims, demands or suits
for consequential, incidental, special, exemplary, punitive, indirect or
multiple damages connected with or resulting from any breach after the Closing
Date of this Agreement or the Ancillary Agreements (other than breach of this
Article X), or any actions undertaken in connection with or related hereto or
thereto, including any such damages which are based upon breach of contract,
tort (including negligence and misrepresentation), breach of warranty, strict
liability, statute, operation of law or any other theory of recovery.
(e) The rights and remedies of Seller and Buyer under this Article X
are, solely as between Seller and Buyer, exclusive and in lieu of any and all
other rights and remedies which Seller and Buyer may have under this Agreement,
the Ancillary Agreements (except as expressly provided in any Continuing Site
Agreement or any Declaration of Easements Agreement) or otherwise for monetary
relief with respect to (i) any breach of, or failure to perform, any covenant or
agreement set forth in this Agreement or the Ancillary Agreements by Seller or
Buyer, (ii) any breach of any representation or warranty by Seller or Buyer,
(iii) the Assumed Obligations or the Retained Liabilities, (iv) noncompliance by
Seller with any bulk sales or transfer laws and (v) any obligation in respect of
Section 2.04, Section 2.05, Section 7.03 or Section 7.14. Each Party agrees that
the previous sentence shall not limit or otherwise affect any non-monetary right
or remedy which either Party may have under this Agreement or the Ancillary
Agreements or otherwise limit or affect either Party's right to seek equitable
relief, including the remedy of specific performance.
(f) Buyer and Seller agree that, notwithstanding Section 10.01(e),
each Party shall retain, subject to the other provisions of this Agreement,
including Sections 10.01(d) and 12.03, all remedies at law or in equity with
respect to (i) fraud or wilful or intentional breaches of this Agreement or the
Ancillary Agreements and (ii) gross negligence or wilful or wanton acts or
omissions to act of any Indemnitee (or any contractor or subcontractor thereof)
on or after the Closing Date.
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SECTION 10.02. Third Party Claims Procedures. (a) If any Indemnitee
receives notice of the assertion of any claim or of the commencement of any
claim, action, or proceeding made or brought by any person who is not a Party or
an Affiliate of a Party (a "Third Party Claim") with respect to which
indemnification is to be sought from an Indemnifying Party, the Indemnitee will
give such Indemnifying Party reasonably prompt written notice thereof, but in
any event not later than 20 Business Days after the Indemnitee's receipt of
notice of such Third Party Claim; provided, however, that a failure to give
timely notice will not affect the rights or obligations of any Indemnitee except
if, and only to the extent that, as a result of such failure, the Indemnifying
Party was actually prejudiced. Such notice shall describe the nature of the
Third Party Claim in reasonable detail and will indicate the estimated amount,
if practicable, of the Indemnifiable Loss that has been or may be sustained by
the Indemnitee.
(b) If a Third Party Claim is made against an Indemnitee, the
Indemnifying Party will be entitled to participate in the defense thereof and,
if it so chooses, to assume the defense thereof with counsel selected by the
Indemnifying Party; provided, however, that such counsel is not reasonably
objected to by the Indemnitee; and provided further that the Indemnifying Party
first admits in writing its liability to the Indemnitee with respect to all
material elements of such claim. Should the Indemnifying Party so elect to
assume the defense of a Third Party Claim, the Indemnifying Party will not be
liable to the Indemnitee for any legal expenses subsequently incurred by the
Indemnitee in connection with the defense thereof. If the Indemnifying Party
elects to assume the defense of a Third Party Claim, the Indemnitee will (i)
cooperate in all reasonable respects with the Indemnifying Party in connection
with such defense, (ii) not admit any liability with respect to, or settle,
compromise or discharge, any Third Party Claim without the Indemnifying Party's
prior written consent and (iii) agree to any settlement, compromise or discharge
of a Third Party Claim which the Indemnifying Party may recommend and which by
its terms obligates the Indemnifying Party to pay the full amount of the
liability in connection with such Third Party Claim and releases the Indemnitee
completely in connection with such Third Party Claim. In the event the
Indemnifying Party shall assume the defense of any Third Party Claim, the
Indemnitee shall be entitled to participate in (but not control) such defense
with its own counsel at its own expense. If the Indemnifying Party does not
assume the defense of any such Third Party Claim, the Indemnitee may defend the
same in such manner as it may deem appropriate, including settling such claim or
litigation
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after giving notice to the Indemnifying Party of the terms of the proposed
settlement and the Indemnifying Party will promptly reimburse the Indemnitee
upon written request. Anything contained in this Agreement to the contrary
notwithstanding, no Indemnifying Party shall be entitled to assume the defense
of any Third Party Claim if such Third Party Claim seeks an order, injunction or
other equitable relief or relief for other than monetary damages against the
Indemnitee which, if successful, would materially adversely affect the business
of the Indemnitee; provided, however, that such Indemnifying Party shall
continue to be obligated to such Indemnitee pursuant to Section 10.01(a) or (b),
as the case may be, for all Indemnifiable Losses relating to, resulting from or
arising out of such Third Party Claim.
ARTICLE XI
Termination
SECTION 11.01. Termination. (a) This Agreement may be terminated at
any time prior to the Closing by an instrument in writing signed on behalf of
each of the Parties.
(b) This Agreement may be terminated by Seller or Buyer if the
Closing shall not have occurred on or before the date that is 12 months from the
date of this Agreement (the "Termination Date"); provided, however, that the
right to terminate this Agreement pursuant to this Section 11.01(b) shall not be
available to any Party whose failure to fulfill any obligation under this
Agreement has been the cause of, or resulted in, the failure of the Closing to
occur on or before such date.
(c) This Agreement may be terminated by either Seller or Buyer if
any Restraint having any of the effects set forth in Section 8.01(b) shall be in
effect and shall have become final and nonappealable; provided, however, that
the Party seeking to terminate this Agreement pursuant to this Section 11.01(c)
shall have used its reasonable best efforts to prevent the entry of and to
remove such Restraint.
ARTICLE XII
Miscellaneous Provisions
SECTION 12.01. Expenses. Except to the extent specifically provided
herein, all costs and expenses
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incurred in connection with this Agreement and the transactions contemplated
hereby shall be borne by the Party incurring such costs and expenses, whether or
not the transactions contemplated hereby are consummated.
SECTION 12.02. Amendment and Modification; Extension; Waiver. This
Agreement may be amended, modified or supplemented only by an instrument in
writing signed on behalf of each of the Parties. Either Party may (i) extend the
time for the performance of any of the obligations or other acts of the other
Party, (ii) waive any inaccuracies in the representations and warranties of the
other Party contained in this Agreement or (iii) waive compliance by the other
Party with any of the agreements or conditions contained in this Agreement. Any
agreement on the part of a Party to any such extension or waiver shall be valid
only if set forth in an instrument in writing signed on behalf of such Party.
The failure of a Party to this Agreement to assert any of its rights under this
Agreement or otherwise shall not constitute a waiver of such rights.
SECTION 12.03. No Survival of Representations or Warranties. Each
and every representation and warranty contained in this Agreement, other than
the representations and warranties contained in Sections 5.01, 5.02, 5.03 and
5.17 and 6.01, 6.02, 6.03 and 6.05 (which representations and warranties shall
survive for 18 months from the Closing Date), shall expire with, and be
terminated and extinguished by the Closing and no such representation or
warranty shall survive the Closing Date. From and after the Closing Date, none
of Seller, Buyer or any officer, director, trustee or Affiliate of any of them
shall have any liability whatsoever with respect to any such representation or
warranty. The expiration of the representations and warranties contained in
Sections 5.01, 5.02, 5.03 and 5.17 and 6.01, 6.02, 6.03 and 6.05 shall not
affect the Parties' obligations under Article X if the Indemnitee provided the
Indemnifying Party with proper notice of the claim or event for which
indemnification is sought prior to such expiration.
SECTION 12.04. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given (as of the time of
delivery or, in the case of a telecopied communication, of confirmation) if
delivered personally, telecopied (which is confirmed) or sent by overnight
courier (providing proof of delivery) to the
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Parties at the following addresses (or at such other address for a Party as
shall be specified by like notice):
if to Seller, to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Telecopy No.: (212) 677-0601
Attention: General Counsel
with a copy on or prior to the Closing Date to:
Cravath, Swaine & Moore
825 Eighth Avenue
New York, NY 10019
Telecopy No.: C212) 474-3700
Attention: George W. Bilicic, Jr., Esq.
if to Buyer, to:
Astoria Generating Company, L.P.
c/o Orion Power Holdings, Inc.
111 Market Place
Suite 520
Baltimore, MD 21202
Telecopy No.: (410) 468-3699
Attention: General Counsel
with a copy on or prior to the Closing Date to:
Thelen Reid & Priest LLP
Two Embarcadero Center
Suite 2100
San Francisco, CA 94111
Telecopy No.: (415) 421-1068
Attention: Thomas B. Glascock, Esq.
SECTION 12.05. Assignment; No Third Party Beneficiaries. (a) This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the Parties and their respective successors and permitted
assigns, but neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any Party, including by operation of
law, without the prior written consent of the other Party, except (i) in the
case of Seller (A) to an Affiliate of Seller or a third party in connection with
the transfer of the Transmission System to such Affiliate or third party or (B)
to a lending institution or trustee in connection with a pledge or granting of a
security interest in all or any part of the
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Transmission System and this Agreement and (ii) in the case of Buyer (A) to an
Affiliate of Buyer in connection with the transfer of the Auctioned Assets to
such Affiliate and (B) to a lending institution or trustee in connection with a
pledge or granting of a security interest in the Auctioned Assets and this
Agreement; provided, however that no assignment or transfer of rights or
obligations by either Party shall relieve it from the full liabilities and the
full financial responsibility, as provided for under this Agreement, unless and
until the transferee or assignee shall agree in writing to assume such
obligations and duties and the other Party has consented in writing to such
assumption.
(b) Nothing in this Agreement is intended to confer upon any other
person except the Parties any rights or remedies hereunder or shall create any
third party beneficiary rights in any person, including, with respect to
continued or resumed employment, any employee or former employee of Seller
(including any beneficiary or dependent thereof). No provision of this Agreement
shall create any rights in any such persons in respect of any benefits that may
be provided, directly or indirectly, under any employee benefit plan or
arrangement except as expressly provided for thereunder.
SECTION 12.06. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York (regardless
of the laws that might otherwise govern under applicable principles of conflicts
of law).
SECTION 12.07. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
SECTION 12.08. Interpretation. When a reference is made in this
Agreement to an Article, Section, Schedule or Exhibit, such reference shall be
to an Article or Section of, or Schedule or Exhibit to, this Agreement unless
otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation" or equivalent words. The words
"hereof", "herein" and "hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement. All terms defined in this Agreement shall
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have the defined meanings when used in the Ancillary Agreements and any
certificate or other document made or delivered pursuant hereto or thereto
unless otherwise defined therein. The definitions contained in this Agreement
are applicable to the singular as well as the plural forms of such terms and to
the masculine as well as to the feminine and neuter genders of such term. Any
agreement, instrument, statute, regulation, rule or order defined or referred to
herein or in any agreement or instrument that is referred to herein means such
agreement, instrument, statute, regulation, rule or order as from time to time
amended, modified or supplemented, including (in the case of agreements or
instruments) by waiver or consent and (in the case of statutes, regulations,
rules or orders) by succession of comparable successor statutes, regulations,
rules or orders and references to all attachments thereto and instruments
incorporated therein. References to a person are also to its permitted
successors and assigns.
SECTION 12.09. Jurisdiction and Enforcement. (a) Each of the Parties
irrevocably submits to the exclusive jurisdiction of (i) the Supreme Court of
the State of New York, New York County and (ii) the United States District Court
for the Southern District of New York, for the purposes of any suit, action or
other proceeding arising out of this Agreement or any transaction contemplated
hereby. Each of the Parties agrees to commence any action, suit or proceeding
relating hereto either in the United States District Court for the Southern
District of New York or, if such suit, action or proceeding may not be brought
in such court for jurisdictional reasons, in the Supreme Court of the State of
New York, New York County. Each of the Parties further agrees that service of
process, summons, notice or document by hand delivery or U.S. registered mail at
the address specified for such Party in Section 12.04 (or such other address
specified by such Party from time to time pursuant to Section 12.04) shall be
effective service of process for any action, suit or proceeding brought against
such Party in any such court. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Supreme Court of the State of New York, New York County, or
(ii) the United States District Court for the Southern District of New York, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
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(b) The Parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement or any Ancillary Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the Parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement or any Ancillary
Agreement and to enforce specifically the terms and provisions of this Agreement
or any Ancillary Agreement, this being in addition to any other remedy to which
they are entitled at law or in equity.
SECTION 12.10. Entire Agreement. This Agreement, the Confidentiality
Agreement and the Ancillary Agreements including the Exhibits, Schedules,
documents, certificates and instruments referred to herein or therein and other
contracts, agreements and instruments contemplated hereby or thereby, embody the
entire agreement and understanding of the Parties in respect of the transactions
contemplated by this Agreement. There are no restrictions, promises,
representations, warranties, covenants or undertakings other than those
expressly set forth or referred to herein or therein. This Agreement and the
Ancillary Agreements supersede all prior agreements' and understandings between
the Parties with respect to the transactions contemplated by this Agreement
other than the Confidentiality Agreement.
SECTION 12.11. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
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SECTION 12.12. Conflicts. Except as expressly otherwise provided
herein or therein, in the event of any conflict or inconsistency between the
terms of this Agreement and the terms of any Ancillary Agreement, the terms of
this Agreement shall prevail.
IN WITNESS WHEREOF, Seller and Buyer have caused this Agreement to
be signed by their respective duly authorized officers as of the date first
above written.
CONSOLIDATED EDISON COMPANY OF
NEW YORK, INC.,
by
/s/ Joan S. Freilich
--------------------------------
Name: Joan S. Freilich
Title: Executive Vice President
ASTORIA GENERATING COMPANY,
BY: ORION POWER NEW YORK GP II, INC.,
by
/s/ Jack A. Fusco
--------------------------------
Name: Jack A. Fusco
Title: President
83
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this 2nd day of March 1999, before me personally appeared Joan S.
Freilich, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
/s/ Carole Sobin
--------------------
NOTARY PUBLIC
84
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this 2 day of March 1999, before me personally appeared Jack A.
Fusco, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
/s/ Graceanne T. Favara
---------------------------
NOTARY PUBLIC
85
EXHIBITS
TO
GENERATING PLANT
AND GAS TURBINE
ASSET PURCHASE AND SALE AGREEMENT
FOR
ASTORIA GENERATING PLANTS
LOCATED AT ASTORIA, QUEENS COUNTY, NEW YORK
GOWANUS GAS TURBINES
LOCATED AT BROOKLYN, KINGS COUNTY, NEW YORK
AND
NARROWS GAS TURBINES
LOCATED AT BROOKLYN, KINGS COUNTY, NEW YORK
EXHIBIT A-1
ASTORIA ZONING LOT
DEVELOPMENT AGREEMENT
By and Between
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
and
The land affected by the within instrument lies in Block 850, Lots 1, 50, 200,
300 on the Tax Map of the City of New York, County of Queens.
Address:
Record and Return to:
Robert Selya, Esq.
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
86
TABLE OF CONTENTS
Page
----
ARTICLE I. EXISTING DEVELOPMENT RIGHTS ................................... -3-
ARTICLE II. REQUIREMENTS FOR DEVELOPMENT ON THE ZONING LOT ............... -5-
ARTICLE III. ENLARGING OR DIMINISHING THE ZONING LOT ..................... -10-
ARTICLE IV. CONVEYANCE OF PORTIONS OF THE ZONING LOT ..................... -14-
ARTICLE V. VIOLATIONS/REAL ESTATE TAXES .................................. -15-
ARTICLE VI. BINDING EFFECT ............................................... -17-
ARTICLE VII. MISCELLANEOUS ............................................... -19-
SCHEDULE I ............................................................... -30-
SCHEDULE II .............................................................. -31-
SCHEDULE III ............................................................. -32-
SCHEDULE IV .............................................................. -33-
87
ASTORIA ZONING LOT DEVELOPMENT AGREEMENT
[Arthur Kill Bundle Closes First]
AGREEMENT dated as of __________, 1999, by and between CONSOLIDATED
EDISON COMPANY OF NEW YORK, INC., a New York corporation ("Grantor"), and
___________, a ___________ corporation ("Grantee") ("Grantor" and "Grantee"
collectively referred to as the "Parties").
WITNESSETH
WHEREAS, Grantee (also the "Lot 1 Owner") is acquiring title in fee
to the real property ("Lot 1") together with any buildings and improvements
located thereon ("Lot 1 Buildings") in the City of New York, located in the
Borough of Queens, County of Queens, designated as Block 850, Lot 200 in the Tax
Map of the City of New York and known as the Astoria Gas Turbines, and more
particularly described in Schedule I annexed hereto and made a part hereof (Lot
1 and the Lot 1 Buildings being hereinafter collectively referred to as the "Lot
1 Premises"); and
WHEREAS. Grantor (also the "Lot 2 Owner") owns certain real property
("Lot 2") together with any buildings and improvements located thereon ("Lot 2
Buildings") in the City of New York, located in the Borough of Queens, County of
Queens, designated as Block 850, Lot 50 in the Tax Map of the City of New York
and known as the Astoria Generating Station, and more particularly described in
Schedule II annexed hereto and made a part hereof (Lot 2 and the Lot 2 Buildings
being hereinafter collectively referred to as the "Lot 2 Premises"), which it
intends to sell; and
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WHEREAS, Grantor (also the "Lot 3 Owner") owns certain real property
("Lot 3") together with the buildings and improvements located thereon ("Lot 3
Buildings") in the City of New York, located in the Borough of Queens, County of
Queens, designated as Block 850, Lot 300 in the Tax Map of the City of New York
and known as the Astoria Tank Farm, and more particularly described in Schedule
III annexed hereto and made a part hereof (Lot 3 and the Lot 3 Buildings being
hereinafter collectively referred to as the "Lot 3 Premises"), which it intends
to sell; and
WHEREAS, Grantor (also the "Lot 4 Owner") owns certain real property
("Lot 4") together with the buildings and improvements located thereon ("Lot 4
Buildings") in the City of New York, located in the Borough of Queens, County of
Queens, designated as Block 850, Lot 1 in the Tax Map of the City of New York,
and more particularly described in Schedule IV annexed hereto and made a part
hereof (Lot 4 and the Lot 4 Buildings being hereinafter collectively referred to
as the "Lot 4 Premises") which it will retain after selling Lots 1, 2 and 3 (Lot
1 Owner, Lot 2 Owner, Lot 3 Owner and Lot 4 Owner collectively referred to as
the "Owners" or the "Parties", individually as an "Owner"; Lot 1 Buildings, Lot
2 Buildings, Lot 3 Buildings and Lot 4 Buildings collectively referred to as the
"Buildings"; and Lot 1 Premises, Lot 2 Premises. Lot 3 Premises and Lot 4
Premises collectively referred to as the "Premises"); and
WHEREAS, Lot 1, Lot 2, Lot 3 and Lot 4 (collectively, the "Lots,"
each a "Lot") are located on the same zoning lot (the "Zoning Lot") as that term
is defined in Section 12-10 of the Zoning Resolution of the City of New York,
effective December 15, 1961, as amended from time to time (the "Zoning
Resolution"); and
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WHEREAS, the Power Authority of the State of New York owns certain
real property in the City of New York, located in the Borough of Queens, County
of Queens, designated as Block 850, Lot 100 in the Tax Map of the City of New
York, which is or may be located on the Zoning Lot; and
WHEREAS, the Parties wish to define their continuing obligations and
responsibilities with respect to their respective Premises located on the Zoning
Lot.
NOW THEREFORE, in consideration of the foregoing, the Parties hereby
agree as follows:
ARTICLE I. EXISTING DEVELOPMENT RIGHTS
Section 1.1. Owners' Development Rights.
(A) Each Owner covenants to the other Owners, their successors and assigns
for the benefit of and as an appurtenance to their respective Lots that from and
after the date hereof, no building, structure, equipment or other improvement on
its Lot, or combination of improvements, including any addition to or extension
of its Buildings, shall be erected or installed or allowed or suffered to exist
on its Lot, and no repair, alteration, reconstruction or rebuilding of its
Buildings (following a casualty or otherwise) shall be made or allowed or
suffered to be made:
(i) having a total Floor Area, as defined in the Zoning Resolution,
in excess of the greater of (x) the amount of Floor Area that would be available
to its Lot under the Zoning Resolution if its Lot were considered to be a
separate zoning lot and (y) the amount of Floor Area existing on the Owner's Lot
on the date of this Agreement (the "Owner Lot Maximum Floor Area"), or
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90
(ii) resulting in the creation on its Lot of (x) a new use that does
not conform to the use regulations in the Zoning Resolution, (y) a failure of
any building or structure on its Lot to comply with any provision of the Zoning
Resolution, including without limitation coverage, yard and bulk requirements,
or (z) an increase in the degree to which any such structure or building fails
to comply with the Zoning Resolution, in each case treating its Lot as if it
were a separate zoning lot.
(B) Subject to applicable laws, rules and regulations, each Owner shall
have the absolute right to construct replacement buildings on its Lot not
violative of the restrictions set forth in subsection (A) of this Section 1.1;
provided however, that if as a result of any amendment or change in the Zoning
Resolution, the Zoning Lot shall become entitled to fewer development rights in
the future, then each Owner shall have the right to construct replacement
buildings or other improvements on its Lot with a Floor Area equal to the lesser
of (i) the amount of Floor Area that would be available to its Lot under the
Zoning Resolution, as amended, if its Lot were considered to be a separate
zoning lot, (ii) the amount of permissible Floor Area remaining on its Lot,
taking into account the existing Floor Area on the other Lots, and (iii) its
proportionate share of the permissible Floor Area available on all the Lots
combined based on the proportion that its Lot area bears to the aggregate area
of all the Lots; and, provided further, that if as a result of any amendment or
change in the Zoning Resolution, the Zoning Lot shall become entitled to
additional development rights in the future, then each Owner shall have the
right to enlarge the existing improvements or construct new improvements on its
Lot to the extent that would be permitted by the Zoning Resolution, treating all
the Lots as if they were separate zoning lots, and
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91
subject to all applicable provisions of the Zoning Resolution, provided such
enlargement or new construction shall not reduce the Floor Area available for
use on the other Owners' Lots.
ARTICLE II. REQUIREMENTS FOR DEVELOPMENT ON THE ZONING LOT
Section 2.1. The Owners hereby agree that construction plans and
specifications for, and applications to, the New York City Department of
Buildings or the New York City Department of Business Services, or such other
governmental agency with jurisdiction over the permitting process for
demolition, alteration and construction of buildings or structures (each a
"Permitting Agency"), for or in connection with any building or structure on
their respective Lots, shall be separate and independent from one another and
shall be filed with the applicable Permitting Agency so as to obtain separate
"new building" and/or "alteration" treatment and numbers and separate
certificates of occupancy, as applicable, each to the extent allowed by law.
Section 2.2. No Owner shall make any application, or any amendment,
modification, supplement or withdrawal relating thereto (collectively the
"Applications", individually an "Application") to any Permitting Agency for any
construction of or alteration, reconstruction or other similar work in any
building or other structure on its Lot, respectively, which could in any way,
except as set forth herein, restrict the rights of any other Owner with respect
to use of Floor Area on such Owner's Lot.
Section 2.3. Floor Area Survey. The first Owner who shall file with
any Permitting Agency a permit for work that would result in increased Floor
Area on such Owner's Lot (for purposes of this Section 2.3, the "Commissioning
Party") shall commission a floor area survey of the Lots and, if possible, the
entire Zoning Lot (the "Floor Area Survey"), which may
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also contain the lot owned by the Power Authority of the State of New York. Such
survey shall be performed by an appropriately licensed professional satisfactory
to all the Owners and the cost of such survey shall be borne by the
Commissioning Party. The Commissioning Party shall submit the Floor Area Survey
to the other Owners for their review and approval, which review shall be
completed within thirty (30) days of each such Owner's receipt of such Survey
and which approval shall not be unreasonably withheld. Any disagreements
regarding the Survey shall be resolved in the best professional judgement of the
licensed professional performing the work. If the Commissioning Party does not
receive comments during such thirty (30) day period, the Floor Area Survey shall
be deemed approved.
Section 2.4. Cooperation.
(A) The Owners shall cooperate with one another in all reasonable respects
in connection with Applications, if any, required to be made by any Owner to any
Permitting Agency for permits or approvals for alteration, reconstruction or
replacement of that Owner's Buildings or for new structures on that Owner's Lot,
and shall execute any such properly prepared Application at the request of that
Owner (for purposes of this Section 2.4, the "Requesting Party"), provided that
any building or other structure to be erected on that Owner's Lot shall be built
in accordance with applicable law and shall conform to the requirements set
forth in Section 1.1(A) herein. No less than thirty (30) days prior to the
Requesting Party's intended submission of an executed Application to a
Permitting Agency, however, it shall submit to the other Owners (i) a
certification prepared by the architect of record demonstrating that the
Application being filed is consistent with the requirements set forth in Section
1.1.(A) herein, (ii) a copy of any completed Application, in a form suitable for
submission to such Permitting Agency, and (iii) a copy of any
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plans and specifications relating to the work described in the application, in a
form suitable for submission to such Permitting Agency. The Requesting Party
shall be responsible for the professional fees incurred by the other Party in
reviewing the Application and related materials.
(B) Such cooperation shall include granting access to the professional
performing the Floor Area Survey, in accordance with Section 2.3. herein, but
shall not include any action which would create any rights of access to the
other Owners' Lots or Buildings or grant to the Requesting Party any rights
relating to such Lots or Buildings which are not expressly stated herein or in
any other agreement between the Owners or binding upon the Zoning Lot. All
Applications shall be made in accordance with all applicable laws. The right of
any Owner to alter, reconstruct or replace its Buildings shall in such cases be
subject to the restrictions and/or benefits of the Zoning Resolution and other
provisions of law as same may hereafter be amended or enacted and in effect at
the time that such Applications are made.
(C) Each Owner covenants and agrees to file a copy of this Agreement
together with any Application for a permit submitted to any Permitting Agency,
and to deliver to the other Owners copies of any Applications for building and
other permits and any plans and specifications submitted to any Permitting
Agency, in each case except permits for interior work, maintenance and repair
that have no effect on Floor Area.
Section 2.5. Performance of Work.
(A) All work to be performed under this Agreement by an Owner (for
purposes of this section, the "Entering Party") affecting its Premises (i) shall
not impair the structural integrity of any Building situated on any other Lot;
(ii) shall not be undertaken until the Entering Party shall have procured and
paid for all required permits; (iii) except for routine maintenance activity,
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shall not be undertaken until the Entering Party shall have submitted to the
other Owners all applicable documents, plans and specifications; (iv) shall be
performed in accordance with good industry practice and in compliance with all
applicable laws, ordinances, orders, codes, rules and regulations; (v) shall be
performed by the Entering Party's employees or by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by any
Owner of its Premises, except (if at all) temporarily, and then only to the
extent necessary to do the work, and (vii) shall be diligently prosecuted to
completion. During any construction or reconstruction work, the construction
site shall be kept in an orderly, clean and safe condition.
(B) The Entering Party shall pay when due all claims for labor performed
or material furnished and not permit any lien of mechanics or materialmen to
attach, and if any such liens do attach, the Entering Party shall not permit
such liens to unreasonably interfere with any other Owner's financing
arrangements or work. The Entering Party shall also be responsible for the
professional fees incurred any other Owner in reviewing the Entering Party's
plans and specifications.
(C) The review of or comments on any documents, drawings, plans,
specifications or other documentation provided by the Entering Party shall not
relieve the Entering Party of, or affect in any way, its responsibility for the
correctness and adequacy of the work to be performed. The other Owners shall
have no liability whatsoever with respect to any review or non-review of any
documentation submitted to it by the Entering Party.
Section 2.6. Performance of Work in Exercising Self-Help Rights.
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(A) All work to be performed under this Agreement by an Owner (for
purposes of this Section 2.6, the "Curing Party") affecting any other Owner's
Premises in accordance with Article IV hereof, (i) shall not impair the
structural integrity or operation of any Building situated on any other Owner's
Lot; (ii) shall not be undertaken until the Curing Party shall have procured and
paid for all required permits; (iii) except for routine maintenance activity,
shall not be undertaken until the Curing Party shall have submitted to the other
Owners all applicable documents, plans and specifications; (iv) shall be
performed in accordance with good industry practice and in compliance with all
applicable laws, ordinances, orders, codes, rules and regulations; (v) shall be
performed by the Curing Party's employees or by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by any
Owner of its Premises, except (if at all) temporarily, and then only to the
extent necessary to do the work, and (vii) shall be diligently prosecuted to
completion. During any construction or reconstruction work, the construction
site shall be kept in an orderly, clean and safe condition.
(B) The Curing Party shall pay when due all claims for labor performed or
material furnished and not permit any lien of mechanics or materialmen to
attach, and if any such liens do attach, the Curing Party shall not permit such
liens to unreasonably interfere with any other Owner's financing arrangements or
work. The Curing Party shall not be responsible for the professional fees
incurred by the other Owners in reviewing the Curing Party's plans and
specifications.
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(C) The review of or comments on any documents, drawings, plans,
specifications or other documentation provided by the Curing Party shall not
relieve the Curing Party of, or affect (in any way, its responsibility for the
correctness and adequacy of the work to be performed. The other Owners shall
have no liability whatsoever with respect to any review or non-review of any
documentation submitted to them by the Curing Party.
(D) Whenever the Curing Party shall intend to enter upon the Premises of
another Owner to perform any work in exercising its Self-Help Rights as defined
in Article IV hereof, the Curing Party shall give the affected Owner (i) at
least twenty-four (24) hours' prior written notice or (ii) immediate verbal
notification followed by written notice in the case of any emergency.
(E) Notwithstanding the provisions of this Article II, any work to be
performed by a Curing Party affecting the easement and license areas governed by
the Astoria Declaration of Subdivision Easements and the Astoria Declaration of
Easements made by Grantor shall be governed by the requirements contained in
such agreements.
ARTICLE III. ENLARGING OR DIMINISHING THE ZONING LOT
Section 3.1. If requested by an Owner (for purposes of this Section
3.1, the "Requesting Party"), each other Owner shall execute, acknowledge and
deliver a Declaration of Zoning Lot Restrictions, any such other necessary
documents, and amendments to this Agreement for the purpose of enlarging the
Zoning Lot so as to include one or more additional parcels; provided that (i)
the execution of the Declaration of Zoning Lot Restrictions, any such other
documents, and any such amendment to this Agreement does not increase the
responsibilities or liabilities or reduce the rights of any other Owner, (ii)
any action requested of
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any Owner by the Requesting Party pursuant to this Section 3.1 shall be without
cost or recourse to any such Owner, and (iii) such Declaration of Zoning Lot
Restrictions, any such other documents, and any such amendment to this Agreement
shall not grant to the Requesting Party any rights relating to an Owner's
Premises which are not expressly stated herein. The Requesting Party shall
promptly pay, or reimburse any Owner for, any cost or expenses incurred by such
Owner arising under this Section 3.1.
Section 3.2. In the event that the Lot 4 Owner shall seek to
effectuate a zoning lot subdivision which would remove Lot 4, or any other
parcel of land which is part of the Zoning Lot, from the Zoning Lot, whether or
not in conjunction with any other Lot being subdivided from the Zoning Lot
simultaneously therewith, each Owner shall use its best efforts to assist the
Lot 4 Owner in accomplishing said subdivision in the most expeditious manner
possible. Such cooperation shall include completing such Applications, executing
such documents and performing such work as may be necessary to meet the
requirements of the Permitting Agency or Agencies overseeing the zoning lot
subdivision process.
Each Owner shall bear a portion of the aggregate costs related to
the zoning lot subdivision process, including without limitation (x) utility
separation work and associated costs and (y) administrative expenses
(collectively, "Aggregate Zoning Lot Subdivision Costs"), in the proportion that
the area of each Owner's Lot bears to the combined area of the Lots.
Notwithstanding the foregoing, Aggregate Zoning Lot Subdivision Costs shall
exclude the costs of bringing each Owner's Buildings into compliance with the
standards necessary to effectuate a zoning lot subdivision ("Compliance Costs").
Each Owner's Compliance Costs shall be borne exclusively by such Owner.
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Upon final zoning lot subdivision approval by the Permitting
Agency(ies), the Aggregate Zoning Lot Subdivision Costs shall be computed by
adding the costs incurred by each Owner ("Actual Subdivision Costs"). Each Owner
shall keep records of all its expenditures and make available to the other
Owners copies of all such records evidencing its Actual Subdivision Costs. If,
after computation of the Aggregate Zoning Lot Subdivision Costs, an Owner's
Actual Subdivision Costs exceeds its proportionate share of the Aggregate Zoning
Lot Subdivision Costs, then that Owner shall be reimbursed for any such excess
by the Owner(s) whose Actual Subdivision Costs are lower than their respective
share(s) of the Aggregate Zoning Lot Subdivision Costs, in order that each Owner
shall bear its proportionate share of the Aggregate Zoning Lot Subdivision
Costs.
Section 3.3. Each Owner (for purposes of this Section 3.3, the
"Agreeing Party") agrees and consents that any other Owner or Owners may execute
any Declaration of Zoning Lot Restrictions, any such other necessary documents,
and any amendment of this Agreement that is entered into for the purpose of
enlarging the Zoning Lot as provided above in Section 3.1 above, without its
joinder, waiver, consent or other act of such Agreeing Party, provided that such
agreement, document or amendment (i) only increases the size of the Zoning Lot,
(ii) only affects the rights of parties other than such Agreeing Party in and to
said Zoning Lot and (iii) does not otherwise adversely affect the rights of such
Agreeing Party in and to said Zoning Lot. Notwithstanding that any such
Declaration of Zoning Lot Restrictions, other necessary documents, or amendment
to this Agreement may be executed without the joinder, waiver, consent or other
act of such Agreeing Party, each Agreeing Party agrees, upon demand of an Owner,
to execute, acknowledge and deliver any such agreement, other document or
amendment
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or deliver any requested waiver or consent, and to use commercially reasonable
efforts to cause any parties-in-interest, as such term is defined in connection
with the definition of zoning lot in Section 12-10 of the Zoning Resolution of
the City of New York, effective December 15, 1961, as amended from time to time
("Parties-in-Interest"), on the enlarged Zoning Lot to waive each of their
rights to execute the Declaration of Zoning Lot Restrictions or any such other
documents.
Section 3.4. Each Owner (for purposes of this Section 3.4, the
"Agreeing Party") agrees and consents that the Lot 4 Owner may execute any
Declaration of Zoning Lot Restrictions, any other such necessary documents, and
any amendment of this Agreement that is entered into for the purpose of
diminishing the Zoning Lot as provided above in Section 3.2 above, without its
joinder, waiver, consent or other act of such Agreeing Party, provided that such
agreement, document or amendment (i) only diminishes the size of the Zoning Lot,
(ii) only affects the rights of parties other than such Agreeing Party in and to
said Zoning Lot and (iii) does not otherwise adversely affect the rights of such
Agreeing Party in and to said Zoning Lot. Notwithstanding that any such
Declaration of Zoning Lot Restrictions, other necessary documents, or amendment
to this Agreement may be executed without the joinder, waiver, consent or other
act of such Agreeing Party, each Agreeing Party agrees, upon demand of the Lot 4
Owner, to execute, acknowledge and deliver any such agreement, other document or
amendment or deliver any requested waiver or consent, and to use commercially
reasonable efforts to cause any Parties-in-Interest on the diminished Zoning Lot
to waive each of their rights to execute the Declaration of Zoning Lot
Restrictions or any such other documents.
Section 3.5. Each Owner acknowledges that the owners of other
properties which may hereafter be merged into the Zoning Lot by any other Owner
may have reserved or retained
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certain development rights attributable to their properties, and each Owner (for
purposes of this Section 3.5, a "Covenanting Party") covenants and agrees not to
(i) utilize, or attempt to utilize, all or any portion of any such reserved or
retained floor area or zoning and development rights in any future development
or alteration of its Premises or (ii) make any application to any Permitting
Agency to incorporate all or any portion of any such reserved or retained floor
area or zoning and development rights into its Premises. The provisions of this
Section 3.5 shall inure to the benefit of each Owner and each owner of
properties hereafter merged into the Zoning Lot and shall be enforceable by each
of them directly against each Covenanting Party in the event of a breach thereof
by such Covenanting Party.
Section 3.6. Each Owner agrees that in the event of an enlargement
of the Zoning Lot by an Owner, prior to recording any Declaration of Zoning Lot
Restrictions, this Agreement shall be amended to reflect the enlargement of the
Zoning Lot and the owner of the parcel being merged into the Zoning Lot shall
execute the amended Agreement and subject its property to the terms hereof.
ARTICLE IV. CONVEYANCE OF PORTIONS OF THE ZONING LOT
Section 4.1. Notwithstanding anything to the contrary contained in
this Agreement, either Party (for purposes of this Section 4.1, a "Conveying
Party") may from time to time convey unimproved portions of its Lot without the
consent of the other Party (the "Non-Conveying Party"); provided, however, that
such conveyance(s) shall not create a non-conforming use or non-compliance for
any zoning lot containing the Non-Conveying Party's Lot or any building thereon,
or result in an increase in any existing non-compliance or non-
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conformity on any such zoning lot, or in any way reduce the floor area allowable
or restrict the uses permissible in any building thereon. The Non-Conveying
Party hereby agrees to execute and deliver, and to use best efforts to cause the
same to be done by all other parties in interest in respect of its Lot, any
documents that the Conveying Party may reasonably deem necessary in connection
with the conveyance of any unimproved portion of its Lot, provided all documents
shall be in form and content reasonably satisfactory to the Non-Conveying Party.
Upon said conveyance, the remaining portion of the Conveying Party's Lot and the
conveyed portion of said Lot shall be treated as separate zoning lots for
purposes of determining the development rights on their Lots under this
Agreement.
ARTICLE V. VIOLATIONS/REAL ESTATE TAXES
Section 5.1. Each Party covenants and agrees to cure and remove of
record with diligence any and all violations, the circumstances or conditions of
which arise after the date of this Agreement, of the Zoning Resolution, any
building code, fire code, or other law, ordinance, regulation or requirement of
record or issued by any municipal, state or federal agency, hereafter in force
and effect with respect to its Premises ("Violations") which may in any manner
adversely affect the other Party's Premises or any actions which the other Party
may wish to undertake with respect thereto pursuant to and consistent with this
Agreement. If each such Party (for purposes of this Section 5.1, a "Violating
Party") has not, within thirty (30) days after it receives notice of each
Violation, cured such Violation, or if not susceptible of being cured within
such thirty (30) day period, if such Violating Party has not commenced
diligently to prosecute a cure of such Violation until completion, or, in the
case of an emergency immediately
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by verbal notice followed by written notice, the other Party shall have the
right, at the Violating Party's expense, to cure said Violation ("Self Help
Rights") and such Violating Party hereby grants to the other Party the right of
access to such Violating Party's Premises for such purpose. Each such Violating
Party shall pay to the other Party on demand sums equal to all costs incurred by
each such Party as a result of the failure by such Violating Party to cure its
Violations, including all fines, penalties and expenses and reasonable
attorneys' fees and disbursements.
Section 5.2. The Parties acknowledge that their separate interests
require that tax assessments concerning their respective Premises be separate
and independent and that each Party shall be responsible for the payment of the
real estate taxes owing on its respective Premises. Each Party agrees, that in
the event the Department of Finance of the City of New York (the "Department of
Finance") has not issued permanent tax lot numbers for the Lots as of the
Closing Date effectuating such separate and independent treatment, it shall
promptly perform such acts and execute and deliver such documents as may
reasonably be required in support of separate tax lot treatment. In the
intervening period following the Closing Date but prior to the issuance of a tax
bill reflecting the issuance of permanent tax lot numbers, the Parties shall use
best efforts to obtain an apportionment by the Department of Finance of real
property tax assessments and real property tax liens among the Premises and
shall pay their respective proportionate shares of the real estate taxes prior
to the date upon which such taxes would become delinquent. If the Parties are
unable to obtain such an apportionment from the Department of Finance, they
shall apportion the real estate taxes attributable to the Buildings. structures
and equipment on their respective Lots based on the most recent tax bill or, if
such breakdown by structures and equipment is not available, based on the
original book cost as of the
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last calendar year end preceding the taxable status date. The taxes attributable
to land would be allocated among the Parties based on the relative land area of
their Lots. Upon the issuance of permanent tax lot numbers for each such Lot and
for so long as the properties remain as separate and independent tax lots, each
such Party shall be free to institute tax certiorari proceedings with respect to
its Premises. At any time prior to the issuance by the Department of Finance of
separate, final tax lot numbers as aforesaid, the Parties shall cooperate with
each other in deciding whether to carry out and in instituting such certiorari
proceedings.
ARTICLE VI. BINDING EFFECT
Section 6.1. Covenants Running with the Land. The benefits and
burdens, rights and obligations created by this Agreement shall be appurtenant
to and run with and burden and be binding upon the Lots, and shall inure to the
benefit of and be binding upon the Parties and those claiming by, through, or
under them until this Agreement shall terminate. The covenants, agreements,
terms, provisions and conditions of this Agreement shall bind and benefit the
successors in interest (as owners of the Lots, whether by sale, foreclosure or
otherwise) of the Parties, any party who joins in a Declaration of Zoning Lot
Restrictions for the purpose of enlarging or diminishing the Zoning Lot in
accordance with Article III hereof, and any such party's successors and assigns,
as the case may be, with the same effect as if mentioned in each instance when a
Party is named or referred to, it being understood and agreed that upon any
transfer of ownership (whether by sale, foreclosure or otherwise) of all or any
part of the Lots, each such successor in interest shall, without the requirement
of any further documentation, thereupon and thereafter assume, and perform and
observe, any and all of the obligations of its
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predecessors in interest under this Agreement with respect to such Lot (or
portion thereof). Notwithstanding the foregoing, each Party shall use reasonable
efforts to cause any such successor in interest to execute an agreement in
recordable form pursuant to which such successor in interest shall assume any
and all obligations of its predecessors in interest under this Agreement;
provided, however, that the failure to obtain any such agreement shall not
detract from the provisions of the previous sentence.
Section 6.2. Assignment. Neither this Agreement nor any of the
rights, interests and obligations hereunder shall be assigned by any Party,
except (1) to a party acquiring all or any portion of a Lot and this Agreement
or (2) to a lending institution or trustee in connection with a pledge or
granting of a security interest in all or any part of a lot and this Agreement,
without the prior written consent of the other Party; and provided further, that
no assignment or transfer of rights or obligations by a Party shall release it
from the full liabilities and full financial responsibility, as provided for
under this Agreement, unless and until (x) the transferee or assignee shall
agree in writing to assume such obligations and duties, (y) the other Party has
consented in writing to such release, and (z) a counterpart of that assumption
agreement has been duly recorded in the Office of the City Register for the
County in which the Lots are located. To the extent that rights hereunder are
assigned to the holder of any mortgage encumbering any of the Premises, or any
interest therein, they shall be enforceable by any such assignee after default
under any such mortgage.
Section 6.3. Zoning Lot Subdivision. Upon final approval by the
applicable Permitting Agency of the zoning lot subdivision separating Lot 4 or
any other Lots from the
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Zoning Lot, Lot 4 and any such other Lots shall no longer be subject to this
Agreement. If the applicable Permitting Agency shall finally approve a zoning
lot subdivision separating all the Lots from one another, this Agreement shall
thereupon terminate. Notwithstanding the above, each Party's rights and
obligations arising prior to said termination shall survive the termination of
this Agreement.
ARTICLE VII. MISCELLANEOUS
Section 7.1. Force Majeure.
(A) Notwithstanding anything in this Agreement to the contrary, no Party
shall have any liability or be otherwise responsible to the other for its
failure to carry out its obligations, with the exception of any obligation to
pay money, under this Agreement if and only to the extent that it becomes
impossible for either Party to so perform as a result of any occurrence or event
which is beyond the reasonable control, and does not result from any fault or
negligence, of the Party affected (each a "Force Majeure Event"), including any
act of God, strike or other labor disturbance, act of a public enemy, war, act
of terrorism, riot, any other civil disturbance, fire, storm, lightning, flood,
earthquake, any other natural disasters, explosion, materials shortage. breakage
or accident to machinery or equipment, any order or regulation or restriction
imposed by any court, administrative or regulatory agency or commission or other
governmental entity or instrumentality, domestic, foreign or supranational or
any department thereof (each a "Governmental Authority"), failure of a
contractor or subcontractor cause by a Force Majeure Event and transportation
delays and stoppages.
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(B) If a Party shall rely on the occurrence of a Force Majeure Event as a
basis for being excused from performance of its obligations under this
Agreement, then the Party relying on such occurrence shall (i) provide prompt
written notice of such Force Majeure Event to the other Party(ies) giving an
estimate of its expected duration and the probable impact on the performance of
its obligations hereunder, (ii) exercise its reasonable best efforts to continue
to perform its obligations under this Agreement, (iii) expeditiously take action
to correct or cure the Force Majeure Event (provided that settlement of strikes
or any other labor dispute will be completely within the sole discretion of the
Party affected by such strike or labor dispute), (iv) exercise its reasonable
best efforts to mitigate or limit damages to the other Party and (v) provide
prompt notice to the other Party(ies) of the cessation of the Force Majeure
Event.
Section 7.2. Default and Remedies. In the event that a Party
defaults, breaches or otherwise fails to perform any obligation of such Party
under this Agreement, the other Party shall have the right to all remedies
available at law or in equity, including the right to injunctive relief and the
right to exercise its Self-Help Rights (and shall be entitled to correlative
reimbursement in connection therewith) without any requirement to pursue or
exhaust any other remedies available to such Party under any other agreement.
All such remedies shall be cumulative and not exclusive. A Party shall have the
right, following notice to the other Party, to take such action as it may deem
necessary or advisable, including payment of any delinquent taxes, to prevent a
foreclosure for nonpayment of taxes or other action by a Governmental Authority
that might affect its rights and interests hereunder and any such action shall
be deemed an exercise of Self-Help Rights (and, accordingly, give rise to
correlative reimbursement rights). The right to reimbursement shall not include
the right to recover punitive or consequential
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damages. In the event a Party is entitled to reimbursement hereunder and same is
not satisfied within thirty (30) days after written demand by the Party entitled
to same, the unpaid obligations shall constitute a lien against the defaulting
Party's Lot; provided, however, that the payment of any monetary obligations
which become due and payable by a Party after recordation of a mortgage on such
Party's Lot granted to an independent third party regularly engaged in the
business of making mortgage loans shall be subordinate to the payment of the
obligations secured by such mortgage.
Section 7.3. Recording. Grantee shall record this Agreement
immediately after the execution of this Agreement and the acquisition of its
Lots and shall bear the costs of recording.
Section 7.4. Notices. All notices, demands, requests and other
communications required hereunder shall be in writing and shall be deemed to
have been given (as of the time of delivery or, in the case of a telecopied
communication, of confirmation) if delivered personally, telecopied (which is
confirmed) or sent by overnight courier (providing proof of delivery) to the
Parties at the following addresses (or at such other addresses for a Party as
shall be specified by like notice):
To Grantee:
with a copy to:
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To Grantor:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attn: Director of Real Estate
with a copy to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attn: Senior Vice President and General Counsel
or at such other address in the United States of America as may be designated by
any of the Parties in a written notice given in accordance with the provisions
of this Section 7.4. The attorney for any Party may send notices on that Party's
behalf.
Section 7.5. Estoppel Certificate. Each Party agrees, within ten
(10) day's after written request by the other, to execute, acknowledge and
deliver to and in favor of any present or proposed lender, Mortgagee, ground
lessor, purchaser, tenant or the like of all or any part of the other Party's
Lot, an estoppel certificate, in a form reasonably satisfactory to such lender,
Mortgagee, ground lessor, purchaser, tenant or the like, stating, among other
things: (i) whether this Agreement is in full force and effect; (ii) whether
this Agreement has been modified or amended and, if so, identifying and
describing any such modification or amendment; (iii) whether there are any sums
then due and owing under this Agreement from either Party to the other, and if
so, specifying the amount thereof and reason therefor; and (iv) whether the
Party giving such certificate knows of any default (or event which, with the
passage of time, the giving of notice, or both, would constitute a default) on
the part of the other Party, or has any
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outstanding claim against the other Party arising under this Agreement and, if
so, specifying the nature of such default or claim.
Section 7.6. Waivers by Subsequent Parties-in-Interest. If an
interest attaches to either Party's Premises subsequent to the date hereof which
would otherwise confer upon the holder of such interest the status of a
Party-in-Interest, any modification, amendment or termination of this Agreement
that is entered into for the purpose of enlarging or subdividing the Zoning Lot
or for the purpose of modifying or terminating the provisions of this Agreement
as they affect the Zoning Lot, as it may be enlarged or diminished, may be
executed without the joinder, waiver, consent or other act of the holder of such
interest. Notwithstanding the foregoing, the affected Party shall obtain from
such holder a waiver of execution of any subsequent amendments to this Agreement
and to subordinate its interest to such Agreement, as it may be amended.
Section 7.7. Mortgagees' Status. Except as set forth in Section 7.2
hereof, the Parties intend that this Agreement be superior to any mortgages or
other instruments evidencing security for indebtedness granted by either Party
from time to time with respect to its Lot. Accordingly, each Party agrees to
obtain and deliver to the other Party such documents and instruments, in
recordable form, as may be reasonably necessary or requested by the other Party
to evidence and confirm the subordination of any such mortgages or other
security instruments to the provisions of this Agreement.
Section 7.8. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same original, and the
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execution of separate counterparts by either Party shall bind the Parties as if
they had each executed the same counterpart.
Section 7.9. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law).
Section 7.10. Extension; Waiver. Any Party may extend the time for
performance of any of the obligations or other acts of the other Party or waive
compliance by the other Party with any of the agreements or conditions contained
in this Agreement. Any agreement on the part of a Party to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such Party. The failure of a Party to this Agreement to assert any of
its rights under this Agreement or otherwise shall not constitute a waiver of
such rights.
Section 7.11. No Third Party Beneficiaries. Nothing in this
Agreement is intended to confer upon any other person except the Parties any
rights or remedies hereunder or shall create any third party beneficiary rights
in any person.
Section 7.12. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible to the fullest extent
permitted by applicable
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law in an acceptable manner to the end that the transactions contemplated hereby
are fulfilled to the extent possible.
Section 7.13. Amendment and Modification. This Agreement may be
amended, modified or supplemented only by an instrument in writing signed on
behalf of the owners from time to time of each Lot.
Section 7.14. Jurisdiction and Enforcement.
(A) Each of the Parties irrevocably submits to the exclusive jurisdiction
of (i) the Supreme Court of the State of New York, New York County and (ii) the
United States District Court for the Southern District of New York, for the
purposes of any suit, action or other proceeding arising out of this Agreement
or any transaction contemplated hereby. Each of the Parties agrees to commence
any action, suit or proceeding relating hereto either in the United States
District Court for the Southern District of New York or, if such suit, action or
proceeding may not be brought in such court for jurisdictional reasons, in the
Supreme Court of the State of New York, New York County. Each of the Parties
further agrees that service of process, summons, notice or document by hand
delivery or U.S. registered mail at the address specified for such Party in
Section 7.4 (or such other address specified by such Party from time to time
pursuant to Section 7.4) shall be effective service of process for any action,
suit or proceeding brought against such Party in any such court. Each of the
Parties irrevocably and unconditionally waives any objection to the laying of
venue of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in (i) the Supreme Court of the State of New
York, New York County or (ii) the United States District Court for the Southern
District of New York, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim
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in any such court that any such action, suit or proceeding brought in any such
court has been brought in an inconvenient forum.
(B) The Parties agree that irreparable damage would occur in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or otherwise breached. It is accordingly agreed that
the Parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement, this being in addition to any other remedy to which they are
entitled at law or in equity.
Section 7.15. Interpretation. When a reference is made in this
Agreement to an Article, Section, Schedule or Exhibit, such reference shall be
to an Article or Section of, or Schedule or Exhibit to, this Agreement unless
otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation". The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement. All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein. The definitions contained in this Agreement
are applicable to the singular as well as the plural forms of such terms and to
the masculine as well as to the feminine and neuter genders of such term. Any
agreement, instrument, statute, regulation, rule or order defined or referred to
herein or in any agreement or instrument that is referred to herein
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means such agreement, instrument, statute, regulation, rule or order as from
time to time amended, modified or supplemented, including (in the case of
agreements or instruments) by waiver or consent and (in the case of statutes,
regulations, rules or orders) by succession of comparable successor statutes,
regulations, rules or orders and references to all attachments thereto and
instruments incorporated therein. References to a person are also to its
permitted successors and assigns.
Section 7.16. Avoidance of Duplication. In the event that a Party
owns more than one Lot, when the Agreement requires that certain actions be
taken or not taken with respect to each Lot, the Party with more than one Lot
shall comply with respect to all of its Lots, each taken individually; provided,
however, that a Party with more than one Lot shall not be required
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to notify itself of actions, submit plans for its own review, make payments to
itself, or take such
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement.
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
By:_______________________
Name:
Title:
Grantee
By:_____________________
Name:
Title:
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STATE OF NEW YORK )
) SS:
COUNTY OF NEW YORK )
On this __ day of_______ 199_, before me personally appeared
_____________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that his signature on the instrument, the individual, or the
corporation upon behalf of which the individual acted, executed the instrument.
____________________________
NOTARY PUBLIC
STATE OF NEW YORK )
) SS:
COUNTY OF NEW YORK )
On this __ day of ________ 199_, before me personally appeared _______________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
____________________________
NOTARY PUBLIC
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EXHIBIT A-2
ASTORIA ZONING LOT
DEVELOPMENT AGREEMENT
By and Between
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
and
ASTORIA GENERATING COMPANY, L.P.
The land affected by the within instrument lies in Block 850, Lots 1, 50, 200,
300 on the Tax Map of the City of New York, County of Queens
Address:
Record and Return to:
Robert Selya, Esq.
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
117
TABLE OF CONTENTS
Page
----
ARTICLE I. EXISTING DEVELOPMENT RIGHTS ................................... -3-
ARTICLE II. REQUIREMENTS FOR DEVELOPMENT ON THE ZONING LOT ............... -5-
ARTICLE III. ENLARGING OR DIMINISHING THE ZONING LOT ..................... -10-
ARTICLE IV. CONVEYANCE OF PORTIONS OF THE ZONING LOT ..................... -14-
ARTICLE V. VIOLATIONS/REAL ESTATE TAXES .................................. -15-
ARTICLE VI. BINDING EFFECT ............................................... -17-
ARTICLE VII. MISCELLANEOUS ............................................... -19-
SCHEDULE I ............................................................... -30-
SCHEDULE II .............................................................. -31-
SCHEDULE III ............................................................. -32-
SCHEDULE IV .............................................................. -33-
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ASTORIA ZONING LOT DEVELOPMENT AGREEMENT
[Astoria Bundle Closes First]
AGREEMENT dated as of ____________________, 1999, by and between
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC., a New York corporation
("Grantor"), and ASTORIA GENERATING COMPANY, L.P., a Delaware limited
partnership ("Grantee") ("Grantor" and "Grantee" collectively referred to as the
"Parties").
WITNESSETH:
WHEREAS, Grantee (also the "Lot 1 Owner") is acquiring title in fee
to the real property ("Lot 1") together with any buildings and improvements
located thereon ("Lot 1 Buildings") in the City of New York, located in the
Borough of Queens, County of Queens, designated as Block 850, Lot 50 in the Tax
Map of the City of New York and known as the Astoria Generating Station, and
more particularly described in Schedule I annexed hereto and made a part hereof
(Lot 1 and the Lot 1 Buildings being hereinafter collectively referred to as the
"Lot I Premises"); and
WHEREAS, Grantee (also the "Lot 2 Owner") is also acquiring title in
fee to the real property ("Lot 2") together with any buildings and improvements
located thereon ("Lot 2 Buildings") in the City of New York, located in the
Borough of Queens, County of Queens, designated as Block 850, Lot 300 in the Tax
Map of the City of New York and known as the Astoria Tank Farm, and more
particularly described in Schedule II annexed hereto and made a part hereof (Lot
2 and the Lot 2 Buildings being hereinafter collectively referred to as the "Lot
2 Premises"); and
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WHEREAS, Grantor (also the "Lot 3 Owner") owns certain real property
("Lot 3") together with the buildings and improvements located thereon ("Lot 3
Buildings") in the City of New York, located in the Borough of Queens, County of
Queens, designated as Block 850, Lot 200 in the Tax Map of the City of New York
and known as the Astoria Gas Turbines, and more particularly described in
Schedule III annexed hereto and made a part hereof (Lot 3 and the Lot 3
Buildings being hereinafter collectively referred to as the "Lot 3 Premises"),
which it intends to sell; and
WHEREAS, Grantor (also the "Lot 4 Owner") owns certain real property
("Lot 4") together with the buildings and improvements located thereon ("Lot 4
Buildings") in the City of New York, located in the Borough of Queens, County of
Queens, designated as Block 850, Lot 1 in the Tax Map of the City of New York,
and more particularly described in Schedule IV annexed hereto and made a part
hereof (Lot 4 and the Lot 4 Buildings being hereinafter collectively referred to
as the "Lot 4 Premises") which it will retain after selling Lots 1, 2 and 3 (Lot
1 Owner, Lot 2 Owner, Lot 3 Owner and Lot 4 Owner collectively referred to as
the "Owners" or the "Parties", individually as an "Owner"; Lot 1 Buildings, Lot
2 Buildings, Lot 3 Buildings and Lot 4 Buildings collectively referred to as the
"Buildings"; and Lot 1 Premises, Lot 2 Premises, Lot 3 Premises and Lot 4
Premises collectively referred to as the "Premises"); and
WHEREAS, Lot 1, Lot 2, Lot 3 and Lot 4 (collectively, the "Lots,"
each a "Lot") are located on the same zoning lot (the "Zoning Lot") as that term
is defined in Section 12-10 of the Zoning Resolution of the City of New York,
effective December 15, 1961, as amended from time to time (the "Zoning
Resolution"); and
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WHEREAS, the Power Authority of the State of New York owns certain
real property in the City of New York, located in the Borough of Queens, County
of Queens, designated as Block 850, Lot 100 in the Tax Map of the City of New
York, which is or may be located on the Zoning Lot; and
WHEREAS, the Parties wish to define their continuing obligations and
responsibilities with respect to their respective Premises located on the Zoning
Lot.
NOW THEREFORE, in consideration of the foregoing, the Parties hereby
agree as follows:
ARTICLE I. EXISTING DEVELOPMENT RIGHTS
Section 1.1. Owners' Development Rights.
(A) Each Owner covenants to the other Owners, their successors and assigns
for the benefit of and as an appurtenance to their respective Lots that from and
after the date hereof, no building, structure, equipment or other improvement on
its Lot, or combination of improvements, including any addition to or extension
of its Buildings, shall be erected or installed or allowed or suffered to exist
on its Lot, and no repair, alteration, reconstruction or rebuilding of its
Buildings (following a casualty or otherwise) shall be made or allowed or
suffered to be made:
(i) having a total Floor Area, as defined in the Zoning Resolution,
in excess of the greater of (x) the amount of Floor Area that would be available
to its Lot under the Zoning Resolution if its Lot were considered to be a
separate zoning lot and (y) the amount of Floor Area existing on the Owner's Lot
on the date of this Agreement (the "Owner Lot Maximum Floor Area"), or
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(ii) resulting in the creation on its Lot of (x) a new use that does
not conform to the use regulations in the Zoning Resolution, (y) a failure of
any building or structure on its Lot to comply with any provision of the Zoning
Resolution, including without limitation coverage, yard and bulk requirements,
or (z) an increase in the degree to which any such structure or building fails
to comply with the Zoning Resolution, in each case treating its Lot as if it
were a separate zoning lot.
(B) Subject to applicable laws, rules and regulations, each Owner shall
have the absolute right to construct replacement buildings on its Lot not
violative of the restrictions set forth in subsection (A) of this Section 1.1;
provided however, that if as a result of any amendment or change in the Zoning
Resolution, the Zoning Lot shall become entitled to fewer development rights in
the future, then each Owner shall have the right to construct replacement
buildings or other improvements on its Lot with a Floor Area equal to the lesser
of (i) the amount of Floor Area that would be available to its Lot under the
Zoning Resolution, as amended, if its Lot were considered to be a separate
zoning lot, (ii) the amount of permissible Floor Area remaining on its Lot,
taking into account the existing Floor Area on the other Lots, and (iii) its
proportionate share of the permissible Floor Area available on all the Lots
combined based on the proportion that its Lot area bears to the aggregate area
of all the Lots; and, provided further, that if as a result of any amendment or
change in the Zoning Resolution, the Zoning Lot shall become entitled to
additional development rights in the future, then each Owner shall have the
right to enlarge the existing improvements or construct new improvements on its
Lot to the extent that would be permitted by the Zoning Resolution, treating all
the Lots as if they were separate zoning lots, and
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subject to all applicable provisions of the Zoning Resolution, provided such
enlargement or new construction shall not reduce the Floor Area available for
use on the other Owners' Lots.
ARTICLE II. REQUIREMENTS FOR DEVELOPMENT ON THE ZONING LOT
Section 2.1. The Owners hereby agree that construction plans and
specifications for, and applications to, the New York City Department of
Buildings or the New York City Department of Business Services, or such other
governmental agency with jurisdiction over the permitting process for
demolition, alteration and construction of buildings or structures (each a
"Permitting Agency"), for or in connection with any building or structure on
their respective Lots, shall be separate and independent from one another and
shall be filed with the applicable Permitting Agency so as to obtain separate
"new building" and/or "alteration" treatment and numbers and separate
certificates of occupancy, as applicable, each to the extent allowed by law.
Section 2.2. No Owner shall make any application, or any amendment,
modification, supplement or withdrawal relating thereto (collectively the
"Applications", individually an "Application") to any Permitting Agency for any
construction of or alteration, reconstruction or other similar work in any
building or other structure on its Lot, respectively, which could in any way,
except as set forth herein, restrict the rights of any other Owner with respect
to use of Floor Area on such Owner's Lot.
Section 2.3. Floor Area Survey. The first Owner who shall file with
any Permitting Agency a permit for work that would result in increased Floor
Area on such Owner's Lot (for purposes of this Section 2.3, the "Commissioning
Party") shall commission a floor area survey of the Lots and, if possible, the
entire Zoning Lot (the "Floor Area Survey"), which may
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also contain the lot owned by the Power Authority of the State of New York. Such
survey shall be performed by an appropriately licensed professional satisfactory
to all the Owners and the cost of such survey shall be borne by the
Commissioning Party. The Commissioning Party shall submit the Floor Area Survey
to the other Owners for their review and approval, which review shall be
completed within thirty (30) days of each such Owner's receipt of such Survey
and which approval shall not be unreasonably withheld. Any disagreements
regarding the Survey shall be resolved in the best professional judgement of the
licensed professional performing the work. If the Commissioning Party does not
receive comments during such thirty (30) day period, the Floor Area Survey shall
be deemed approved.
Section 2.4. Cooperation.
(A) The Owners shall cooperate with one another in all reasonable respects
in connection with Applications, if any, required to be made by any Owner to any
Permitting Agency for permits or approvals for alteration, reconstruction or
replacement of that Owner's Buildings or for new structures on that Owner's Lot,
and shall execute any such properly prepared Application at the request of that
Owner (for purposes of this Section 2.4. the "Requesting Party"), provided that
any building or other structure to be erected on that Owner's Lot shall be built
in accordance with applicable law and shall conform to the requirements set
forth in Section 1.1(A) herein. No less than thirty (30) days prior to the
Requesting Party's intended submission of an executed Application to a
Permitting Agency, however, it shall submit to the other Owners (i) a
certification prepared by the architect of record demonstrating that the
Application being filed is consistent with the requirements set forth in Section
1.1.(A) herein, (ii) a copy of any completed Application, in a form suitable for
submission to such Permitting Agency, and (iii) a copy of any
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plans and specifications relating to the work described in the application, in a
form suitable for submission to such Permitting Agency. The Requesting Party
shall be responsible for the professional fees incurred by the other Party in
reviewing the Application and related materials.
(B) Such cooperation shall include granting access to the professional
performing the Floor Area Survey, in accordance with Section 2.3. herein, but
shall not include any action which would create any rights of access to the
other Owners' Lots or Buildings or grant to the Requesting Party any rights
relating to such Lots or Buildings which are not expressly stated herein or in
any other agreement between the Owners or binding upon the Zoning Lot. All
Applications shall be made in accordance with all applicable laws. The right of
any Owner to alter, reconstruct or replace its Buildings shall in such cases be
subject to the restrictions and/or benefits of the Zoning Resolution and other
provisions of law as same may hereafter be amended or enacted and in effect at
the time that such Applications are made.
(C) Each Owner covenants and agrees to file a copy of this Agreement
together with any Application for a permit submitted to any Permitting Agency,
and to deliver to the other Owners copies of any Applications for building and
other permits and any plans and specifications submitted to any Permitting
Agency, in each case except permits for interior work, maintenance and repair
that have no effect on Floor Area.
Section 2.5. Performance of Work.
(A) All work to be performed under this Agreement by an Owner (for
purposes of this section, the "Entering Party") affecting its Premises (i) shall
not impair the structural integrity of any Building situated on any other Lot;
(ii) shall not be undertaken until the Entering Party shall have procured and
paid for all required permits; (iii) except for routine maintenance activity,
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shall not be undertaken until the Entering Party shall have submitted to the
other Owners all applicable documents, plans and specifications; (iv) shall be
performed in accordance with good industry practice and in compliance with all
applicable laws, ordinances, orders, codes, rules and regulations; (v) shall be
performed by the Entering Party's employees or by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by any
Owner of its Premises, except (if at all) temporarily, and then only to the
extent necessary to do the work, and (vii) shall be diligently prosecuted to
completion. During any construction or reconstruction work, the construction
site shall be kept in an orderly, clean and safe condition.
(B) The Entering Party shall pay when due all claims for labor performed
or material furnished and not permit any lien of mechanics or materialmen to
attach, and if any such liens do attach, the Entering Party shall not permit
such liens to unreasonably interfere with any other Owner's financing
arrangements or work. The Entering Party shall also be responsible for the
professional fees incurred any other Owner in reviewing the Entering Party's
plans and specifications.
(C) The review of or comments on any documents, drawings, plans,
specifications or other documentation provided by the Entering Party shall not
relieve the Entering Party of, or affect in any way, its responsibility for the
correctness and adequacy of the work to be performed. The other Owners shall
have no liability whatsoever with respect to any review or non-review of any
documentation submitted to it by the Entering Party.
Section 2.6. Performance of Work in Exercising Self-Help Rights.
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(A) All work to be performed under this Agreement by an Owner (for
purposes of this section, the "Curing Party") affecting any other Owner's
Premises in accordance with Article IV hereof, (i) shall not impair the
structural integrity or operation of any Building situated on any other Owner's
Lot; (ii) shall not be undertaken until the Curing Party shall have procured and
paid for all required permits; (iii) except for routine maintenance activity,
shall not be undertaken until the Curing Party shall have submitted to the other
Owners all applicable documents, plans and specifications; (iv) shall be
performed in accordance with good industry practice and in compliance with all
applicable laws, ordinances, orders, codes, rules and regulations; (v) shall be
performed by the Curing Party's employees or by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by any
Owner of its Premises, except (if at all) temporarily, and then only to the
extent necessary to do the work, and (vii) shall be diligently prosecuted to
completion. During any construction or reconstruction work, the construction
site shall be kept in an orderly, clean and safe condition.
(B) The Curing Party shall pay when due all claims for labor performed or
material furnished and not permit any lien of mechanics or materialmen to
attach, and if any such liens do attach, the Curing Party shall not permit such
liens to unreasonably interfere with any other Owner's financing arrangements or
work. The Curing Party shall not be responsible for the professional fees
incurred by the other Owners in reviewing the Curing Party's plans and
specifications.
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(C) The review of or comments on any documents, drawings, plans,
specifications or other documentation provided by the Curing Party shall not
relieve the Curing Party of, or affect (in any way, its responsibility for the
correctness and adequacy of the work to be performed. The other Owners shall
have no liability whatsoever with respect to any review or non-review of any
documentation submitted to them by the Curing Party.
(D) Whenever the Curing Party shall intend to enter upon the Premises of
another Owner to perform any work in exercising its Self-Help Rights as defined
in Article IV hereof, the Curing Party shall give the affected Owner (i) at
least twenty-four (24) hours' prior written notice or (ii) immediate verbal
notification followed by written notice in the case of any emergency.
(E) Notwithstanding the provisions of this Article II, any work to be
performed by a Curing Party affecting the easement and license areas governed by
the Astoria Declaration of Subdivision Easements and the Astoria Declaration of
Easements made by Grantor shall be governed by the requirements contained in
such agreements pertaining thereto.
ARTICLE III. ENLARGING OR DIMINISHING THE ZONING LOT
Section 3.1. If requested by an Owner (for purposes of this Section
3.1, the "Requesting Party"), each other Owner shall execute, acknowledge and
deliver a Declaration of Zoning Lot Restrictions, any such other necessary
documents, and amendments to this Agreement for the purpose of enlarging the
Zoning Lot so as to include one or more additional parcels; provided that (i)
the execution of the Declaration of Zoning Lot Restrictions, any such other
documents, and any such amendment to this Agreement does not increase the
responsibilities or liabilities or reduce the rights of any other Owner, (ii)
any action requested of
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any Owner by the Requesting Party pursuant to this Section 3.1 shall be without
cost or recourse to any such Owner, and (iii) such Declaration of Zoning Lot
Restrictions, any such other documents, and any such amendment to this Agreement
shall not grant to the Requesting Party any rights relating to an Owner's
Premises which are not expressly stated herein. The Requesting Party shall
promptly pay, or reimburse any Owner for, any cost or expenses incurred by such
Owner arising under this Section 3.1.
Section 3.2. In the event that the Lot 4 Owner shall seek to
effectuate a zoning lot subdivision which would remove Lot 4, or any other
parcel of land which is part of the Zoning Lot, from the Zoning Lot, whether or
not in conjunction with any other Lot being subdivided from the Zoning Lot
simultaneously therewith, each Owner shall use its best efforts to assist the
Lot 4 Owner in accomplishing said subdivision in the most expeditious manner
possible. Such cooperation shall include completing such Applications, executing
such documents and performing such work as may be necessary to meet the
requirements of the Permitting Agency or Agencies overseeing the zoning lot
subdivision process.
Each Owner shall bear a portion of the aggregate costs related to
the zoning lot subdivision process, including without limitation (x) utility
separation work and associated costs and (y) administrative expenses
(collectively, "Aggregate Zoning Lot Subdivision Costs"), in the proportion that
the area of each Owner's Lot bears to the combined area of the Lots.
Notwithstanding the foregoing, Aggregate Zoning Lot Subdivision Costs shall
exclude the costs of bringing each Owner's Buildings into compliance with the
standards necessary to effectuate a zoning lot subdivision ("Compliance Costs").
Each Owner's Compliance Costs shall be borne exclusively by such Owner.
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Upon final zoning lot subdivision approval by the Permitting
Agency(ies), the, Aggregate Zoning Lot Subdivision Costs shall be computed by
adding the costs incurred by each Owner ("Actual Subdivision Costs"). Each Owner
shall keep records of all its expenditures and make available to the other
Owners copies of all such records evidencing its Actual Subdivision Costs. If,
after computation of the Aggregate Zoning Lot Subdivision Costs, an Owner's
Actual Subdivision Costs exceeds its proportionate share of the Aggregate Zoning
Lot Subdivision Costs, then that Owner shall be reimbursed for any such excess
by the Owner(s) whose Actual Subdivision Costs are lower than their respective
share(s) of the Aggregate Zoning Lot Subdivision Costs, in order that each Owner
shall bear its proportionate share of the Aggregate Zoning Lot Subdivision
Costs.
Section 3.3. Each Owner (for purposes of this Section 3.3, the
"Agreeing Party") agrees and consents that any other Owner or Owners may execute
any Declaration of Zoning Lot Restrictions, any such other necessary documents,
and any amendment of this Agreement that is entered into for the purpose of
enlarging the Zoning Lot as provided above in Section 3.1 above, without its
joinder, waiver, consent or other act of such Agreeing Party, provided that such
agreement, document or amendment (i) only increases the size of the Zoning Lot,
(ii) only affects the rights of parties other than such Agreeing Party in and to
said Zoning Lot and (iii) does not otherwise adversely affect the rights of such
Agreeing Party in and to said Zoning Lot. Notwithstanding that any such
Declaration of Zoning Lot Restrictions, other necessary documents, or amendment
to this Agreement may be executed without the joinder, waiver, consent or other
act of such Agreeing Party, each Agreeing Party agrees, upon demand of an Owner,
to execute, acknowledge and deliver any such agreement, other document or
amendment
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or deliver any requested waiver or consent, and to use commercially reasonable
efforts to cause any parties-in-interest, as such term is defined in connection
with the definition of zoning lot in Section 12-10 of the Zoning Resolution of
the City of New York, effective December 15, 1961, as amended from time to time
("Parties-in-Interest"), on the enlarged Zoning Lot to waive each of their
rights to execute the Declaration of Zoning Lot Restrictions or any such other
documents.
Section 3.4. Each Owner (for purposes of this Section 3.4, the
"Agreeing Party") agrees and consents that the Lot 4 Owner may execute any
Declaration of Zoning Lot Restrictions, any other such necessary documents, and
any amendment of this Agreement that is entered into for the purpose of
diminishing the Zoning Lot as provided above in Section 3.2 above, without its
joinder, waiver, consent or other act of such Agreeing Party, provided that such
agreement, document or amendment (i) only diminishes the size of the Zoning Lot,
(ii) only affects the rights of parties other than such Agreeing Party in and to
said Zoning Lot and (iii) does not otherwise adversely affect the rights of such
Agreeing Party in and to said Zoning Lot. Notwithstanding that any such
Declaration of Zoning Lot Restrictions, other necessary documents, or amendment
to this Agreement may be executed without the joinder, waiver, consent or other
act of such Agreeing Party, each Agreeing Party agrees, upon demand of the Lot 4
Owner, to execute, acknowledge and deliver any such agreement, other document or
amendment or deliver any requested waiver or consent, and to use commercially
reasonable efforts to cause any Parties-in-Interest on the diminished Zoning Lot
to waive each of their rights to execute the Declaration of Zoning Lot
Restrictions or any such other documents.
Section 3.5. Each Owner acknowledges that the owners of other
properties which may hereafter be merged into the Zoning Lot by any other Owner
may have reserved or retained
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certain development rights attributable to their properties, and each Owner (for
purposes of this Section 3.5, a "Covenanting Party") covenants and agrees not to
(i) utilize, or attempt to utilize, all or any portion of any such reserved or
retained floor area or zoning and development rights in any future development
or alteration of its Premises or (ii) make any application to any Permitting
Agency to incorporate all or any portion of any such reserved or retained floor
area or zoning and development rights into its Premises. The provisions of this
Section 3.5 shall inure to the benefit of each Owner and each owner of
properties hereafter merged into the Zoning Lot and shall be enforceable by each
of them directly against each Covenanting Party in the event of a breach thereof
by such Covenanting Party.
Section 3.6. Each Owner agrees that in the event of an enlargement
of the Zoning Lot by an Owner, prior to recording any Declaration of Zoning Lot
Restrictions, this Agreement shall be amended to reflect the enlargement of the
Zoning Lot and the owner of the parcel being merged into the Zoning Lot shall
execute the amended Agreement and subject its property to the terms hereof.
ARTICLE IV.
CONVEYANCE OF PORTIONS OF THE ZONING LOT
Section 4.1. Notwithstanding anything to the contrary contained in
this Agreement, either Party (for purposes of this Section 4.1, a "Conveying
Party") may from time to time convey unimproved portions of its Lot without the
consent of the other Party (the "Non-Conveying Party"); provided, however, that
such conveyance(s) shall not create a non-conforming use or non-compliance for
any zoning lot containing the Non-Conveying Party's Lot or any building thereon,
or result in an increase in any existing non-compliance or non-
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conformity on any such zoning lot, or in any way reduce the floor area allowable
or restrict the uses permissible in any building thereon. The Non-Conveying
Party hereby agrees to execute and deliver, and to use best efforts to cause the
same to be done by all other parties in interest in respect of its Lot, any
documents that the Conveying Party may reasonably deem necessary in connection
with the conveyance of any unimproved portion of its Lot, provided all documents
shall be in form and content reasonably satisfactory to the Non-Conveying Party.
Upon said conveyance, the remaining portion of the Conveying Party's Lot and the
conveyed portion of said Lot shall be treated as separate zoning lots for
purposes of determining the development rights on their Lots under this
Agreement.
ARTICLE V. VIOLATIONS/REAL ESTATE TAXES
Section 5.1. Each Party covenants and agrees to cure and remove of
record with diligence any and all violations, the circumstances or conditions of
which arise after the date of this Agreement, of the Zoning Resolution, any
building code, fire code, or other law, ordinance, regulation or requirement of
record or issued by any municipal, state or federal agency, hereafter in force
and effect with respect to its Premises ("Violations") which may in any manner
adversely affect the other Party's Premises or any actions which the other Party
may wish to undertake with respect thereto pursuant to and consistent with this
Agreement. If each such Party (for purposes of this Section 5.1, a "Violating
Party") has not, within thirty (30) days after it receives notice of each
Violation, cured such Violation, or if not susceptible of being cured within
such thirty (30) day period, if such Violating Party has not commenced
diligently to
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prosecute a cure of such Violation until completion, or, in the case of an
emergency immediately by verbal notice followed by written notice, the other
Party shall have the right, at the Violating Party's expense, to cure said
Violation ("Self Help Rights") and such Violating Party hereby grants to the
other Party the right of access to such Violating Party's Premises for such
purpose. Each such Violating Party shall pay to the other Party on demand sums
equal to all costs incurred by each such Party as a result of the failure by
such Violating Party to cure its Violations, including all fines, penalties and
expenses and reasonable attorneys' fees and disbursements.
Section 5.2. The Parties acknowledge that their separate interests
require that tax assessments concerning their respective Premises be separate
and independent and that each Party shall be responsible for the payment of the
real estate taxes owing on its respective Premises. Each Party agrees, that in
the event the Department of Finance of the City of New York (the "Department of
Finance") has not issued permanent tax lot numbers for the Lots as of the
Closing Date effectuating such separate and independent treatment, it shall
promptly perform such acts and execute and deliver such documents as may
reasonably be required in support of separate tax lot treatment. In the
intervening period following the Closing Date but prior to the issuance of a tax
bill reflecting the issuance of permanent tax lot numbers, the Parties shall use
best efforts to obtain an apportionment by the Department of Finance of real
property tax assessments and real property tax liens among the Premises and
shall pay their respective proportionate shares of the real estate taxes prior
to the date upon which such taxes would become delinquent. If the Parties are
unable to obtain such an apportionment from the Department of Finance, they
shall apportion the real estate taxes attributable to the Buildings, structures
and equipment on their respective Lots based on the most recent tax bill or, if
such
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breakdown by structures and equipment is not available, based on the original
book cost as of the last calendar year end preceding the taxable status date.
The taxes attributable to land would be allocated among the Parties based on the
relative land area of their Lots. Upon the issuance of permanent tax lot numbers
for each such Lot and so long as the properties remain as separate and
independent tax lots, each such Party shall be free to institute tax certiorari
proceedings with respect to its Premises. At any time prior to the issuance by
the Department of Finance of separate, final tax lot numbers as aforesaid, the
Parties shall cooperate with each other in deciding whether to carry out and in
instituting such certiorari proceedings.
ARTICLE VI. BINDING EFFECT
Section 6.1. Covenants Running with the Land. The benefits and
burdens, rights and obligations created by this Agreement shall be appurtenant
to and run with and burden and be binding upon the Lots, and shall inure to the
benefit of and be binding upon the Parties and those claiming by, through, or
under them until this Agreement shall terminate. The covenants, agreements,
terms, provisions and conditions of this Agreement shall bind and benefit the
successors in interest (as owners of the Lots, whether by sale, foreclosure or
otherwise) of the Parties, any party who joins in a Declaration of Zoning Lot
Restrictions for the purpose of enlarging or diminishing the Zoning Lot in
accordance with Article III hereof, and any such party's successors and assigns,
as the case may be, with the same effect as if mentioned in each instance when a
Party is named or referred to, it being understood and agreed that upon any
transfer of ownership (whether by sale, foreclosure or otherwise) of all or any
part of the Lots, each such successor in interest shall, without the requirement
of any further documentation,
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thereupon and thereafter assume, and perform and observe, any and all of the
obligations of its predecessors in interest under this Agreement with respect to
such Lot (or portion thereof). Notwithstanding the foregoing, each Party shall
use reasonable efforts to cause any such successor in interest to execute an
agreement in recordable form pursuant to which such successor in interest shall
assume any and all obligations of its predecessors in interest under this
Agreement; provided, however, that the failure to obtain any such agreement
shall not detract from the provisions of the previous sentence.
Section 6.2. Assignment. Neither this Agreement nor any of the
rights, interests and obligations hereunder shall be assigned by any Party,
except (1) to a party acquiring all or any portion of a Lot and this Agreement
or (2) to a lending institution or trustee in connection with a pledge or
granting of a security interest in all or any part of a Lot and this Agreement,
without the prior written consent of the other Party; and provided further, that
no assignment or transfer of rights or obligations by a Party shall release it
from the full liabilities and full financial responsibility, as provided for
under this Agreement, unless and until (x) the transferee or assignee shall
agree in writing to assume such obligations and duties, (y) the other Party has
consented in writing to such release, and (z) a counterpart of that assumption
agreement has been duly recorded in the Office of the City Register for the
County in which the Lots are located. To the extent that rights hereunder are
assigned to the holder of any mortgage encumbering any of the Premises, or any
interest therein, they shall be enforceable by any such assignee after default
under any such mortgage.
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Section 6.3. Zoning Lot Subdivision. Upon final approval by the
applicable Permitting Agency of the zoning lot subdivision separating Lot 4 or
any other Lots from the Zoning Lot, Lot 4 and any such other Lots shall no
longer be subject to this Agreement. If the applicable Permitting Agency shall
finally approve a zoning lot subdivision separating all the Lots from one
another, this Agreement shall thereupon terminate. Notwithstanding the above,
each Party's rights and obligations arising prior to said termination shall
survive the termination of this Agreement.
ARTICLE VII. MISCELLANEOUS
Section 7.1. Force Majeure.
(A) Notwithstanding anything in this Agreement to the contrary, no Party
shall have any liability or be otherwise responsible to the other for its
failure to carry out its obligations, with the exception of any obligation to
pay money, under this Agreement if and only to the extent that it becomes
impossible for either Party to so perform as a result of any occurrence or event
which is beyond the reasonable control, and does not result from any fault or
negligence, of the Party affected (each a "Force Majeure Event"), including any
act of God, strike or other labor disturbance, act of a public enemy, war, act
of terrorism, riot, any other civil disturbance, fire, storm, lightning, flood,
earthquake, any other natural disasters, explosion, materials shortage, breakage
or accident to machinery or equipment, any order or regulation or restriction
imposed by any court, administrative or regulatory agency or commission or other
governmental entity or instrumentality, domestic, foreign or supranational or
any department thereof (each a
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"Governmental Authority"), failure of a contractor or subcontractor cause by a
Force Majeure Event and transportation delays and stoppages.
(B) If a Party shall rely on the occurrence of a Force Majeure Event as a
basis for being excused from performance of its obligations under this
Agreement, then the Party relying on such occurrence shall (i) provide prompt
written notice of such Force Majeure Event to the other Party(ies) giving an
estimate of its expected duration and the probable impact on the performance of
its obligations hereunder, (ii) exercise its reasonable best efforts to continue
to perform its obligations under this Agreement, (iii) expeditiously take action
to correct or cure the Force Majeure Event (provided that settlement of strikes
or any other labor dispute will be completely within the sole discretion of the
Party affected by such strike or labor dispute), (iv) exercise its reasonable
best efforts to mitigate or limit damages to the other Party and (v) provide
prompt notice to the other Party(ies) of the cessation of the Force Majeure
Event.
Section 7.2. Default and Remedies. In the event that a Party
defaults, breaches or otherwise fails to perform any obligation of such Party
under this Agreement, the other Party shall have the right to all remedies
available at law or in equity, including the right to injunctive relief and the
right to exercise its Self-Help Rights (and shall be entitled to correlative
reimbursement in connection therewith) without any requirement to pursue or
exhaust any other remedies available to such Party under any other agreement.
All such remedies shall be cumulative and not exclusive. A Party shall have the
right, following notice to the other Party, to take such action as it may deem
necessary or advisable, including payment of any delinquent taxes, to prevent a
foreclosure for nonpayment of taxes or other action by a Governmental Authority
that might affect its rights and interests hereunder and any such action shall
be deemed
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an exercise of Self-Help Rights (and, accordingly, give rise to correlative
reimbursement rights). The right to reimbursement shall not include the right to
recover punitive or consequential damages. In the event a Party is entitled to
reimbursement hereunder and same is not satisfied within thirty (30) days after
written demand by the Party entitled to same, the unpaid obligations shall
constitute a lien against the defaulting Party's Lot; provided, however, that
the payment of any monetary obligations which become due and payable by a Party
after recordation of a mortgage on such Party's Lot granted to an independent
third party regularly engaged in the business of making mortgage loans shall be
subordinate to the payment of the obligations secured by such mortgage.
Section 7.3. Recording. Grantee shall record this Agreement
immediately after the execution of this Agreement and the acquisition of its
Lots and shall bear the costs of recording.
Section 7.4. Notices. All notices, demands, requests and other
communications required hereunder shall be in writing and shall be deemed to
have been given (as of the time of delivery or, in the case of a telecopied
communication, of confirmation) if delivered personally, telecopied (which is
confirmed) or sent by overnight courier (providing proof of delivery) to the
Parties at the following addresses (or at such other addresses for a Party as
shall be specified by like notice):
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To Grantee:
Astoria Generating Company, L.P.
c/o Orion Power New York GP II, Inc.
111 Market Place
Suite 520
Baltimore, MD 21202
Telecopy No.: (410) 468-3699
Attention: General Counsel
with a copy to:
Thelen Reid & Priest LLP
Two Embarcadero Center
Suite 2100
San Francisco, CA 94111
Telecopy No.: (415) 421-1068
Attention: Thomas B. Glascock, Esq.
To Grantor:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attn: Director of Real Estate
with a copy to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attn: Senior Vice President and General Counsel
or at such other address in the United States of America as may be designated by
any of the Parties in a written notice given in accordance with the provisions
of this Section 7.4. The attorney for any Party may send notices on that Party's
behalf.
Section 7.5. Estoppel Certificate. Each Party agrees, within ten
(10) days after written request by the other, to execute, acknowledge and
deliver to and in favor of any present
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or proposed lender, Mortgagee, ground lessor, purchaser, tenant or the like of
all or any part of the other Party's Lot, an estoppel certificate, in a form
reasonably satisfactory to such lender, Mortgagee, ground lessor, purchaser,
tenant or the like, stating, among other things: (i) whether this Agreement is
in full force and effect; (ii) whether this Agreement has been modified or
amended and, if so, identifying and describing any such modification or
amendment; (iii) whether there are any sums then due and owing under this
Agreement from either Party to the other, and if so, specifying the amount
thereof and reason therefor; and (iv) whether the Party giving such certificate
knows of any default (or event which, with the passage of time, the giving of
notice, or both, would constitute a default) on the part of the other Party, or
has any outstanding claim against the other Party arising under this Agreement
and, if so, specifying the nature of such default or claim.
Section 7.6. Waivers by Subsequent Parties-in-Interest. If an
interest attaches to either Party's Premises subsequent to the date hereof which
would otherwise confer upon the holder of such interest the status of a
Party-in-Interest, any modification, amendment or termination of this Agreement
that is entered into for the purpose of enlarging or subdividing the Zoning Lot
or for the purpose of modifying or terminating the provisions of this Agreement
as they affect the Zoning Lot, as it may be enlarged or diminished, may be
executed without the joinder, waiver, consent or other act of the holder of such
interest. Notwithstanding the foregoing, the affected Party shall obtain from
such holder a waiver of execution of any subsequent amendments to this Agreement
and to subordinate its interest to such Agreement, as it may be amended.
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Section 7.7. Mortgagees' Status. Except as set forth in Section 7.2
hereof, the Parties intend that this Agreement be superior to any mortgages or
other instruments evidencing security for indebtedness granted by either Party
from time to time with respect to its Lot. Accordingly, each Party agrees to
obtain and deliver to the other Party such documents and instruments, in
recordable form, as may be reasonably necessary or requested by the other Party
to evidence and confirm the subordination of any such mortgages or other
security instruments to the provisions of this Agreement.
Section 7.8. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same original, and the execution of separate counterparts by either Party shall
bind the Parties as if they had each executed the same counterpart.
Section 7.9. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law).
Section 7.10. Extension; Waiver. Any Party may extend the time for
performance of any of the obligations or other acts of the other Party or waive
compliance by the other Party with any of the agreements or conditions contained
in this Agreement. Any agreement on the part of a Party to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such Party. The failure of a Party to this Agreement to assert any of
its rights under this Agreement or otherwise shall not constitute a waiver of
such rights.
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Section 7.11. No Third Party Beneficiaries. Nothing in this
Agreement is intended to confer upon any other person except the Parties any
rights or remedies hereunder or shall create any third party beneficiary rights
in any person.
Section 7.12. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
Section 7.13. Amendment and Modification. This Agreement may be
amended, modified or supplemented only by an instrument in writing signed on
behalf of the owners from time to time of each Lot.
Section 7.14. Jurisdiction and Enforcement.
(A) Each of the Parties irrevocably submits to the exclusive jurisdiction
of (i) the Supreme Court of the State of New York, New York County and (ii) the
United States District Court for the Southern District of New York, for the
purposes of any suit, action or other proceeding arising out of this Agreement
or any transaction contemplated hereby. Each of the Parties agrees to commence
any action, suit or proceeding relating hereto either in the United States
District Court for the Southern District of New York or, if such suit, action or
proceeding may not be brought in such court for jurisdictional reasons, in the
Supreme Court of the State of
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New York, New York County. Each of the Parties further agrees that service of
process, summons, notice or document by hand delivery or U.S. registered mail at
the address specified for such Party in Section 7.4 (or such other address
specified by such Party from time to time pursuant to Section 7.4) shall be
effective service of process for any action, suit or proceeding brought against
such Party in any such court. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Supreme Court of the State of New York, New York County or
(ii) the United States District Court for the Southern District of New York, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
(B) The Parties agree that irreparable damage would occur in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or otherwise breached. It is accordingly agreed that
the Parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement, this being in addition to any other remedy to which they are
entitled at law or in equity.
Section 7.15. Interpretation. When a reference is made in this
Agreement to an Article, Section, Schedule or Exhibit, such reference shall be
to an Article or Section of, or Schedule or Exhibit to, this Agreement unless
otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes"
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or "including" are used in this Agreement, they shall be deemed to be followed
by the words "without limitation". The words "hereof", "herein" and "hereunder"
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement. All
terms defined in this Agreement shall have the defined meanings when used in any
certificate or other document made or delivered pursuant hereto unless otherwise
defined therein. The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such term. Any agreement,
instrument, statute, regulation, rule or order defined or referred to herein or
in any agreement or instrument that is referred to herein means such agreement,
instrument, statute, regulation, rule or order as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes, regulations, rules or orders)
by succession of comparable successor statutes, regulations, rules or orders and
references to all attachments thereto and instruments incorporated therein.
References to a person are also to its permitted successors and assigns.
Section 7.16. Avoidance of Duplication. In the event that a Party
owns more than one Lot, when the Agreement requires that certain actions be
taken or not taken with respect to each Lot, the Party with more than one Lot
shall comply with respect to all of its Lots, each taken individually; provided,
however, that a Party with more than one Lot shall not be required to notify
itself of actions, submit plans for its own review, make payments to itself, or
take such other similar duplicative actions that may arise hereunder.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement.
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.,
By: _______________________________
Name: Joan S. Freilich
Title: Executive Vice President
and CFO
ASTORIA GENERATING COMPANY, L.P.,
By: ORION POWER NEW YORK GP
II, INC.,
By: __________________________
Name:
Title:
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STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this __ day of_______ 199_, before me personally appeared Joan S.
Freilich, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
________________________________
NOTARY PUBLIC
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this __ day of ________ 199_, before me personally appeared ______________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
________________________________
NOTARY PUBLIC
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EXHIBIT A-3
GOWANUS ZONING LOT
DEVELOPMENT AGREEMENT
By and Between
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
and
ASTORIA GENERATING COMPANY, L.P.
The land affected by the within instrument lies in Block 653, Lots
3 and 7 on the Tax Map of the City of New York, County of
Kings.
Address:
Record and Return to:
Robert Selya, Esq.
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
148
TABLE OF CONTENTS
Page
----
ARTICLE I. EXISTING DEVELOPMENT RIGHTS ................................. -2-
ARTICLE II. REQUIREMENTS FOR DEVELOPMENT ON THE ZONING LOT .............. -5-
ARTICLE III. ENLARGING OR DIMINISHING THE ZONING LOT ..................... -11-
ARTICLE IV. CONVEYANCE OF PORTIONS OF THE ZONING LOT .................... -16-
ARTICLE V. VIOLATIONS/REAL ESTATE TAXES ................................ -17-
ARTICLE VI. BINDING EFFECT .............................................. -20-
ARTICLE VII. MISCELLANEOUS ............................................... -22-
SCHEDULE I ............................................................... -32-
SCHEDULE II .............................................................. -33-
149
GOWANUS
ZONING LOT DEVELOPMENT AGREEMENT
AGREEMENT dated as of ____________,199_, by and between CONSOLIDATED
EDISON COMPANY OF NEW YORK, INC., a New York corporation ("Grantor") and ASTORIA
GENERATING COMPANY, L.P., a Delaware limited partnership ("Grantee") ("Grantee"
and "Grantor" collectively referred to as the "Parties").
WITNESSETH:
WHEREAS, Grantee, on the date hereof, is acquiring title in fee to a
portion of the real property ("Grantee's Lot") together with the buildings and
improvements located thereon ("Grantee's Buildings") owned by Grantor in the
City of New York, located in the Borough of Queens, County of Kings, designated
in the Tax Map of the City of New York as Block 653, Lot 7, known as the Gowanus
Gas Turbines, as such Grantee's Lot is more particularly described in Schedule I
annexed hereto and made a part hereof (Grantee's Lot and Grantee's Buildings
being hereinafter collectively referred to as the "Grantee's Premises"); and
WHEREAS, Grantor, as of the date hereof, will continue to own
certain real property ("Grantor's Lot") together with the buildings and
improvements located thereon ("Grantor's Buildings") in the City of New York,
located in the Borough of Brooklyn, County of Kings, designated as Block 653,
Lot 3, known as the Gowanus Substation, as such Grantor's Lot is more
particularly described in Schedule II annexed hereto and made a part hereof
(Grantor's Lot and Grantor's Buildings being hereinafter collectively referred
to as the "Grantor's Premises"); and
150
WHEREAS, Grantor's Lot and Grantee's Lot are located on the same
zoning lot (the "Zoning Lot") as that term is defined in Section 12-10 of the
Zoning Resolution of the City of New York , effective December 15, 1961, as
amended from time to time (the "Zoning Resolution") (Grantee's Lot and Grantor's
Lot are sometimes hereinafter referred to as a "Lot" or the "Lots," Grantee's
Buildings and Grantor's Buildings as a "Building" or the "Buildings," and
Grantee's Premises and Grantor's Premises as the "Premises"); and
WHEREAS, Grantor and Grantee wish to define their continuing
obligations and responsibilities with respect to their respective Premises
located on the Zoning Lot.
NOW THEREFORE, in consideration of the foregoing, Grantor and
Grantee hereby agree as follows:
ARTICLE I. EXISTING DEVELOPMENT RIGHTS
Section 1.1 Grantee's Development Rights
(A) Grantee hereby covenants to Grantor, its successors and assigns for
the benefit of and as an appurtenance to Grantor's Lot, that from and after the
date hereof, no building, structure, equipment or other improvement on Grantee's
Lot, or combination of improvements, including any addition to or extension of
Grantee's Buildings, shall be erected or installed or allowed or suffered to
exist on Grantee's Lot, and no repair, alteration, reconstruction or rebuilding
of Grantee's Buildings (following a casualty or otherwise) shall be made or
allowed or suffered to be made:
(i) having a total Floor Area, as defined in the Zoning Resolution,
in excess of the greater of (x) the amount of Floor Area that would be available
to Grantee's Lot under the
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Zoning Resolution if Grantee's Lot were considered a separate zoning lot and (y)
the amount of Floor Area existing on the Grantee's Lot on the date of this
Agreement (the "Grantee Maximum Floor Area"); or
(ii) resulting in the creation on Grantee's Lot of (x) a new use
that does not conform to the use regulations in the Zoning Resolution, (y) a
failure of any building or structure on Grantee's Lot to comply with any
provision of the Zoning Resolution, including without limitation coverage, yard
and bulk requirements, or (z) an increase in the degree to which any such
structure or building fails to comply with the Zoning Resolution, in each case
treating Grantee's Lot as if it were a separate zoning lot.
(B) Subject to applicable laws, rules and regulations, Grantee shall have
the absolute right to construct replacement buildings on Grantee's Lot not
violative of the restrictions set forth in subsection (A) of this Section 1.1;
provided however, that if as a result of any amendment or change in the Zoning
Resolution, the Zoning Lot shall become entitled to fewer development rights in
the future, then Grantee shall have the right to construct replacement buildings
or other improvements on its Lot with a Floor Area equal to the lesser of (i)
the amount of Floor Area that would be available to its Lot under the Zoning
Resolution, as amended, if its Lot were considered to be a separate zoning lot,
(ii) the amount of permissible Floor Area remaining on its Lot, taking into
account the existing Floor Area on Grantor's Lot, and (iii) its proportionate
share of the permissible Floor Area available on both Lots combined based on the
proportion that its Lot area bears to the aggregate area of both Lots; and,
provided further, that if as a result of any amendment or change in the Zoning
Resolution, the Zoning Lot shall become entitled to additional development
rights in the future, then Grantee shall have the right to enlarge the
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existing improvements or construct new improvements on Grantee's Lot to the
extent that would be permitted by the Zoning Resolution, if Grantee's Lot were
considered to be a separate zoning lot, provided such enlargement or new
construction shall not reduce the Floor Area available for use on Grantor's Lot.
Section 1.2. Grantor's Development Rights
(A) Grantor hereby covenants to Grantee, its successors and assigns for
the benefit of and as an appurtenance to Grantee's Lot, that from and after the
date hereof, no building, structure, equipment or other improvement on Grantor's
Lot, or combination of improvements, including any addition to or extension of
Grantor's Buildings, shall be erected or installed or allowed or suffered to
exist on Grantor's Lot, and no repair, alteration, reconstruction or rebuilding
of Grantor's Buildings (following a casualty or otherwise) shall be made or
allowed or suffered to be made:
(i) having a total Floor Area, as defined in the Zoning Resolution,
in excess of the greater of (x) the amount of Floor Area that would be available
to Grantor's Lot under the Zoning Resolution if Grantor's Lot were considered a
separate zoning lot and (y) the amount of Floor Area existing on the Grantor's
Lot on the date of this Agreement (the "Grantor Maximum Floor Area"); or
(ii) resulting in the creation on Grantor's Lot of (x) a new use
that does not conform to the use regulations in the Zoning Resolution, (y) a
failure of any building or structure on Grantor's Lot to comply with any
provision of the Zoning Resolution, including without limitation coverage, yard
and bulk requirements, or (z) an increase in the degree to which any
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such structure or building fails to comply with the Zoning Resolution, in each
case treating Grantor's Lot as if it were a separate zoning lot.
(B) Subject to applicable laws, rules and regulations, Grantor shall have
the absolute right to construct replacement buildings on Grantor's Lot not
violative of the restrictions set forth in subsection (A) of this Section 1.2;
provided however, that if as a result of any amendment or change in the Zoning
Resolution, the Zoning Lot shall become entitled to fewer development rights in
the future, then Grantor shall have the right to construct replacement buildings
or other improvements on its Lot with a Floor Area equal to the lesser of (i)
the amount of Floor Area that would be available to its Lot under the Zoning
Resolution, as amended, if its Lot were considered to be a separate zoning lot,
(ii) the amount of permissible Floor Area remaining on its Lot, taking into
account the existing Floor Area on Grantee's Lot, and (iii) its proportionate
share of the permissible Floor Area available on both Lots combined based on the
proportion that its Lot area bears to the aggregate area of both Lots; and,
provided further, that if as a result of any amendment or change in the Zoning
Resolution, Grantor shall become entitled to additional development rights in
the future, then Grantor shall have the right to enlarge the existing
improvements or construct new improvements on Grantor's Lot to the extent that
would be permitted by the Zoning Resolution if Grantor's Lot were considered to
be a separate zoning lot, provided such enlargement or new construction shall
not reduce the Floor Area available for use on Grantee's Lot.
ARTICLE II. REQUIREMENTS FOR DEVELOPMENT ON THE ZONING LOT
Section 2.1. Grantee and Grantor each agree that construction plans
and specifications for, and applications to, the New York City Department of
Buildings or the New
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York City Department of Business Services, or such other governmental agency
with jurisdiction over the permitting process for demolition, alteration and
construction of buildings or structures (each a "Permitting Agency"), for or in
connection with any building or structure on Grantee's Lot or Grantor's Lot,
respectively, shall be separate and independent from one another and shall be
filed with the applicable Permitting Agency so as to obtain separate "new
building" and/or "alteration" treatment and numbers and separate certificates of
occupancy, as applicable, each to the extent allowed by law.
Section 2.2. Neither Grantee nor Grantor shall make any application,
or any amendment, modification, supplement or withdrawal relating thereto
(collectively an "Applications", individually an "Application"), to any
Permitting Agency for any construction of or alteration, reconstruction or other
similar work in any building or other structure on Grantee's Lot or Grantor's
Lot, respectively, which could in any way, except as set forth herein, restrict
the rights of the other Party with respect to use of Floor Area on their
respective Lots.
Section 2.3. Floor Area Survey. The first Party who shall file with
any Permitting Agency a permit for work that would result in increased Floor
Area on such Party's Lot (the "Commissioning Party") shall commission a floor
area survey of the entire Zoning Lot (the "Floor Area Survey"). Such survey
shall be performed by an appropriately licensed professional satisfactory to
both Parties and the cost of such survey shall be borne by the Commissioning
Party. The Commissioning Party shall submit the Floor Area Survey to the other
Party for its review and approval, which review shall be completed within thirty
(30) days of such Party's receipt of such Survey and which approval shall not be
unreasonably withheld. Any disagreements regarding the Survey shall be resolved
in the best professional judgement of the
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licensed professional performing the work. If the Commissioning Party does not
receive comments during such thirty (30) day review period, the Floor Area
Survey shall be deemed approved.
Section 2.4. Cooperation.
(A) The Parties shall cooperate with one another in all reasonable
respects in connection with Applications, if any, required to be made by either
Party to any Permitting Agency for permits or approvals for alteration,
reconstruction or replacement of Grantor's Buildings or Grantee's Buildings or
for new structures on Grantee's Lot or Grantor's Lot, and shall execute any such
properly prepared Application at the request of the other Party (for purposes of
this Section 2.4, the "Requesting Party"), provided that any building or other
structure to be erected on Grantee's Lot or Grantor's Lot shall be built in
accordance with applicable law and conform to the requirements set forth in
Sections 1.1.(A) and 1.2(A), respectively. No less than thirty (30) days prior
to the Requesting Party's intended submission of an executed Application to a
Permitting Agency, it shall submit to the other Party (i) a certification
prepared by the architect of record demonstrating that the Application being
filed is consistent with the requirements of Sections 1.1(A) or 1.2(A), as
applicable, (ii) a copy of any completed Application, in a form suitable for
submission to such Permitting Agency, and (iii) a copy of any plans and
specifications relating to the work described in the Application, in a form
suitable for submission to such Permitting Agency. The Requesting Party shall be
responsible for the professional fees incurred by the other Party in reviewing
the Application and related materials.(1)
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(1) Con Edison is willing to consider proposals for more specific provisions
relating to Application approvals.
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(B) Such cooperation shall include granting access to the professional
performing the Floor Area Survey, in accordance with Section 2.3. herein, but
shall not include any action which would create any rights of access to the
other Party's Lot or Buildings or grant to such Party any rights relating to
such Lot or Buildings which are not expressly stated herein or in any other
agreement between the Parties or binding upon the Zoning Lot. All Applications
shall be made in accordance with all applicable laws. The right of either Party
to alter, reconstruct or replace its Buildings shall in such cases be subject to
the restrictions and/or benefits of the Zoning Resolution and other provisions
of law as same may hereafter be amended or enacted and in effect at the time
that such Applications are made.
(C) Each Party covenants and agrees to file a copy of this Agreement
together with any Application for a permit submitted to any Permitting Agency,
and to deliver to the other Party copies of any Applications for building and
other permits and any plans and specifications submitted to any Permitting
Agency, in each case except permits for interior work, maintenance and repair
that have no effect on Floor Area.
Section 2.5. Performance of Work.
(A) All work to be performed under this Agreement by a Party (for purposes
of this section, the "Entering Party") affecting its Premises (i) shall not
impair the structural integrity of any Building situated on any other Lot; (ii)
shall not be undertaken until the Entering Party shall have procured and paid
for all required permits; (iii) except for routine maintenance activity, shall
not be undertaken until the Entering Party shall have submitted to the other
Party all applicable documents, plans and specifications; (iv) shall be
performed in accordance with good industry practice and in compliance with all
applicable laws, ordinances, orders, codes, rules and
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regulations; (v) shall be performed by the Entering Party's employees or by
contractors fully insured, licensed (to the extent required by applicable law)
and competent to do the work being undertaken; (vi) shall be performed in a
manner that does not materially adversely affect or substantially interfere with
the use and enjoyment by any Party of its Premises, except (if at all)
temporarily, and then only to the extent necessary to do the work, and (vii)
shall be diligently prosecuted to completion. During any construction or
reconstruction work, the construction site shall be kept in an orderly, clean
and safe condition.
(B) The Entering Party shall pay when due all claims for labor performed
or material furnished and not permit any lien of mechanics or materialmen to
attach, and if any such liens do attach, the Entering Party shall not permit
such liens to unreasonably interfere with any other Owner's financing
arrangements or work. The Entering Party shall also be responsible for the
professional fees incurred by the other Party in reviewing the Entering Party's
plans and specifications.
(C) The review of or comments on any documents, drawings, plans,
specifications or other documentation provided by the Entering Party shall not
relieve the Entering Party of, or affect in any way, its responsibility for the
correctness and adequacy of the work to be performed. The other Party shall have
no liability whatsoever with respect to any review or non-review of any
documentation submitted to it by the Entering Party.
Section 2.6. Performance of Work in Exercising Self-Help Rights.
(A) All work to be performed under this Agreement by a Party (for purposes
of this section, the "Curing Party") affecting the other Party's Premises in
accordance with Article IV hereof, (i) shall not impair the structural integrity
or operation of any Building situated on that
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Party's Lot; (ii) shall not be undertaken until the Curing Party shall have
procured and paid for all required permits; (iii) except for routine maintenance
activity, shall not be undertaken until the Curing Party shall have submitted to
the other Party all applicable documents, plans and specifications; (iv) shall
be performed in accordance with good industry practice and in compliance with
all applicable laws, ordinances, orders, codes, rules and regulations; (v) shall
be performed by the Curing Party's employees or by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by the
other Party of its Premises, except (if at all) temporarily, and then only to
the extent necessary to do the work, and (vii) shall be diligently prosecuted to
completion. During any construction or reconstruction work, the construction
site shall be kept in an orderly, clean and safe condition.
(B) The Curing Party shall pay when due all claims for labor performed or
material furnished and not permit any lien of mechanics or materialmen to
attach, and if any such liens do attach, the Curing Party shall not permit such
liens to unreasonably interfere with any other Owner's financing arrangements or
work. The Curing Party shall not be responsible for the professional fees
incurred by the other Party in reviewing the Curing Party's plans and
specifications.
(C) The review of or comments on any documents, drawings, plans,
specifications or other documentation provided by the Curing Party shall not
relieve the Curing Party of, or affect in any way, its responsibility for the
correctness and adequacy of the work to be performed. The
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other Party shall have no liability whatsoever with respect to any review or
non-review of any documentation submitted to it by the Curing Party.
(D) Whenever the Curing Party shall intend to enter upon the Premises of
the other Party to perform any work in exercising its Self-Help Rights as
defined in Article IV hereof, the Curing Party shall give the affected Party (i)
at least twenty-four (24) hours' prior written notice or (ii) immediate verbal
notification followed by written notice in the case of any emergency.
(E) Notwithstanding the provisions of this Article II, any work to be
performed by a Curing Party affecting the easement and license areas governed by
the Gowanus Declaration of Subdivision Easements made by Grantor and the Gowanus
Declaration of Easements Agreement between the Parties shall be governed by the
requirements contained in such agreements.
ARTICLE III. ENLARGING OR DIMINISHING THE ZONING LOT
Section 3.1. If requested by Grantor, Grantee shall execute,
acknowledge and deliver a Declaration of Zoning Lot Restrictions, any such other
necessary documents, and amendments to this Agreement for the purpose of
enlarging the Zoning Lot so as to include one or more additional parcels;
provided that (i) the execution of the Declaration of Zoning Lot Restrictions,
any such other documents and any such amendment to this Agreement does not
increase the responsibilities or liabilities or reduce the rights of Grantee,
(ii) any action requested of Grantee by Grantor pursuant to this Section 3.1
shall be without cost or recourse to Grantee and (iii) such Declaration of
Zoning Lot Restrictions, any such other documents and any such amendment to this
Agreement shall not grant to Grantor any rights relating to Grantee's Premises
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which are not expressly stated herein. Grantor shall promptly pay, or reimburse
Grantee for, any costs or expenses incurred by Grantee arising under this
Section 3.1.
Section 3.2. If requested by Grantee, Grantor shall execute,
acknowledge and deliver a Declaration of Zoning Lot Restrictions, any such other
necessary documents, and amendments to this Agreement for the purpose of
enlarging the Zoning Lot so as to include one or more additional parcels;
provided that (i) the execution of the Declaration of Zoning Lot Restrictions,
any such other documents and any such amendment to this Agreement does not
increase the responsibilities or liabilities or reduce the rights of Grantor,
(ii) any action requested of Grantor by Grantee pursuant to this Section 3.2
shall be without cost or recourse to Grantor and (iii) such Declaration of
Zoning Lot Restrictions, any such other documents and any such amendment to this
Agreement shall not grant to Grantee any rights relating to Grantor's Premises
which are not expressly stated herein. Grantee shall pay, or reimburse Grantor
for, any costs or expenses incurred by Grantor arising under this Section 3.2.
Section 3.3. In the event that Grantor shall seek to effectuate a
zoning lot subdivision which would remove Grantor's Lot, or any other parcel of
land which is part of the Zoning Lot, from the Zoning Lot, Grantee shall use its
best efforts to assist Grantor in accomplishing said subdivision in the most
expeditious manner possible. Such cooperation shall include completing such
applications, executing such documents and performing such work as may be
necessary to meet the requirements of the Permitting Agency or Agencies
overseeing the zoning lot subdivision process.
Each Party shall bear a portion of the aggregate costs related to
the zoning lot subdivision process, including without limitation (x) utility
separation work and associated costs
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and (y) administrative expenses (collectively, "Aggregate Zoning Lot Subdivision
Costs"), in the proportion that the area of Grantee's Lot or Grantor's Lot, as
the case may be, bears to the area of the Zoning Lot as a whole. Notwithstanding
the foregoing, Aggregate Zoning Lot Subdivision Costs shall exclude the costs of
bringing Grantee's Buildings and Grantor's Buildings into compliance with the
standards necessary to effectuate a zoning lot subdivision ("Grantee Compliance
Costs" and "Grantor Compliance Costs," respectively). Grantee Compliance Costs
shall be borne exclusively by the Grantee and Grantor Compliance Costs shall be
borne exclusively by the Grantor.
Upon final zoning lot subdivision approval by the Permitting
Agency(ies), the Aggregate Zoning Lot Subdivision Costs shall be computed by
adding the costs incurred by each Party ("Actual Grantee Subdivision Costs" and
"Actual Grantor Subdivision Costs," respectively). Each Party shall keep records
of all its expenditures and make available to the other copies of all such
records evidencing the Actual Grantee Subdivision Costs and Actual Grantor
Subdivision Costs. If, after computation of the Aggregate Zoning Lot Subdivision
Costs, the Actual Grantee Subdivision Costs exceed Grantee's proportion of the
Aggregate Zoning Lot Subdivision Costs, then Grantor shall reimburse Grantee for
any such excess. Conversely, if the Actual Grantor Subdivision Costs exceed
Grantor's proportion of the Aggregate Zoning Lot Subdivision Costs, then Grantee
shall reimburse Grantor for any such excess.
Section 3.4. Grantee hereby agrees and consents that Grantor may
execute any Declaration of Zoning Lot Restrictions, any other necessary
documents and any amendment of this Agreement that is entered into for the
purpose of enlarging or diminishing the Zoning Lot as
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provided above in Sections 3.1, 3.2 and 3.3, without the joinder, waiver,
consent or other act of Grantee, provided that such agreement or amendment (i)
only reduces or increases the size of the Zoning Lot, (ii) only affects the
rights of parties other than Grantee in and to said Zoning Lot and (iii) does
not otherwise adversely affect the rights of Grantee in and to said Zoning Lot.
Notwithstanding that any such Declaration of Zoning Lot Restrictions, any such
other documents or amendment to this Agreement may be executed without the
joinder, waiver, consent or other act of Grantee, Grantee agrees, upon demand of
Grantor, to execute, acknowledge and deliver any such agreement or amendment or
deliver any requested waiver or consent, and to use commercially reasonable
efforts to cause any parties-in-interest, as such term is defined in connection
with the applicable definition of zoning lot in Section 12-10 of the Zoning
Resolution of the City of New York, effective December 15, 1961, as amended from
time to time ("Parties-in-Interest"), on the enlarged or diminished Zoning Lot
to waive each of their rights to execute the Declaration of Zoning Lot
Restrictions, or any such other documents.
Section 3.5. Grantor hereby agrees and consents that Grantee may
execute any Declaration of Zoning Lot Restrictions, any other necessary
documents and any amendment of this Agreement that is entered into for the
purpose of enlarging the Zoning Lot as provided above in Sections 3.1 and 3.2,
without the joinder, waiver, consent or other act of Grantor, provided that such
agreement or amendment (i) only increases the size of the Zoning Lot, (ii) only
affects the rights of parties other than Grantor in and to said Zoning Lot and
(iii) does not otherwise adversely affect the rights of Grantor in and to said
Zoning Lot. Notwithstanding that any such Declaration of Zoning Lot
Restrictions, any other such documents or amendment to this Agreement may be
executed without the joinder, waiver, consent or other act of Grantor, Grantor
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agrees, upon demand of Grantee, to execute, acknowledge and deliver any such
agreement, document or amendment or deliver any requested waiver or consent, and
to use commercially reasonable efforts to cause any Parties-in-Interest on the
enlarged Zoning Lot to waive each of their rights to execute the Declaration of
Zoning Lot Restrictions.
Section 3.6. Grantee acknowledges that the owners of other
properties which may hereafter be merged into the Zoning Lot by Grantor may have
reserved or retained certain floor area and zoning and development rights
attributable to their properties, and Grantee covenants and agrees not to (i)
utilize, or attempt to utilize, all or any portion of any such reserved or
retained floor area or zoning and development rights in any future development
or alteration of Grantee's Premises or (ii)make any application to any
Permitting Agency to incorporate all or any portion of any such reserved or
retained floor area or zoning and development rights into Grantee's Premises.
The provisions of this Section 3.6 shall inure to the benefit of each of the
owners of the properties now or hereafter constituting the Zoning Lot and shall
be enforceable by said owners directly against Grantee in the event of a breach
thereof by Grantee.
Section 3.7. Grantor acknowledges that the owners of other
properties which may hereafter be merged into the Zoning Lot by Grantee may have
reserved or retained certain floor area and zoning and development rights
attributable to their properties, and the Grantor covenants and agrees not to
(i) utilize, or attempt to utilize, all or any portion of any such reserved or
retained floor area or zoning and development rights in any future development
or alteration of the Grantor's Premises or (ii)make any application to any
Permitting Agency to incorporate all or any portion of any such reserved or
retained floor area or zoning and
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development rights into the Grantor's Premises. The provisions of this Section
3.7 shall inure to the benefit of each of the owners of the properties now or
hereafter constituting the Zoning Lot and shall be enforceable by said owners
directly against Grantor in the event of a breach thereof by Grantor.
Section 3.8. Each Party agrees that in the event of an enlargement
of the Zoning Lot by either Party, prior to recording any Declaration of Zoning
Lot Restrictions, this Agreement shall be amended to reflect the enlargement of
the Zoning Lot and the owner of the parcel being merged into the Zoning Lot
shall execute the amended Agreement and subject its property to the terms
hereof.
ARTICLE IV.
CONVEYANCE OF PORTIONS OF THE ZONING LOT
Section 4.1. Notwithstanding anything to the contrary contained in
this Agreement, Grantor may from time to time convey unimproved portions of its
Lot without the consent of Grantee; provided, however, that such conveyance(s)
shall not create a non-conforming use or non-compliance for any zoning lot
containing Grantee's Lot or any building thereon, or result in an increase in
any existing non-compliance or nonconformity on any such zoning lot, or in any
way reduce the floor area allowable or restrict the uses permissible in any
building thereon. Grantee hereby agrees to execute and deliver, and to use best
efforts to cause the same to be done by all other parties in interest in respect
of its Lot, any documents that Grantor may reasonably deem necessary in
connection with the conveyance of any unimproved portion of its Lot, provided
all documents shall be in form and content reasonably satisfactory to Grantee.
Upon said conveyance, the remaining portion of Grantor's Lot and the conveyed
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portion of said Lot shall be treated as separate zoning lots for purposes of
determining the development rights on their Lots under this Agreement.
Section 4.2. Notwithstanding anything to the contrary contained in
this Agreement, Grantee may from time to time convey unimproved portions of its
Lot without the consent of Grantor; provided, however, that such conveyance(s)
shall not create a non-conforming use or non-compliance for any zoning lot
containing Grantor's Lot or any building thereon, or result in an increase in
any existing non-compliance or nonconformity on any such zoning lot, or in any
way reduce the floor area allowable or restrict the uses permissible in any
building thereon. Grantor hereby agrees to execute and deliver, and to use best
efforts to cause the same to be done by all other parties in interest in respect
of its Lot, any documents that Grantee may reasonably deem necessary in
connection with the conveyance of any unimproved portion of its Lot, provided
all documents shall be in form and content reasonably satisfactory to Grantor.
Upon said conveyance, the remaining portion of Grantee's Lot and the conveyed
portion of said Lot shall be treated as separate zoning lots for purposes of
determining the development rights on their Lots under this Agreement.
ARTICLE V. VIOLATIONS/REAL ESTATE TAXES
Section 5.1. Grantee covenants and agrees to cure and remove of
record with diligence any and all violations, the circumstances or conditions of
which arise after the date of this Agreement, of the Zoning Resolution, any
building code, fire code, or other law, ordinance, regulation or requirement of
record or issued by any municipal, state or federal agency, hereafter in force
and effect with respect to Grantee's Premises (collectively "Grantee's
Violations" and
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individually, a "Grantee's Violation") which may in any manner adversely affect
Grantor's Premises or any actions which Grantor may wish to undertake with
respect thereto pursuant to and consistent with this Agreement. If Grantee has
not, within thirty (30) days after it receives notice of each such Grantee's
Violation, cured such Grantee's Violation, or if not susceptible of being cured
within such thirty (30) day period, if Grantee has not commenced diligently to
prosecute a cure of such Grantee's Violation and/or does not diligently
prosecute such cure until completion, or, in the case of an emergency
immediately by verbal notice followed by written notice, Grantor shall have the
right, at Grantee's expense, to cure said Grantee's Violation ("Self Help
Rights") and Grantee hereby grants to Grantor the right of access to Grantee's
Premises for such purpose. Grantee shall pay to Grantor on demand sums equal to
all costs incurred by Grantor as a result of the failure by Grantee to cure
Grantee's Violations, including all fines, penalties and expenses and reasonable
attorneys' fees and disbursements.
Section 5.2. Grantor covenants and agrees to cure and remove of
record with diligence any and all violations, the circumstances or conditions of
which arise after the date of this Agreement, of any building code, fire code,
or other law, ordinance, regulation or requirement of record or issued by any
municipal, state or federal agency, hereafter in force and effect with respect
to Grantor's Premises (collectively "Grantor's Violations" and individually a
"Grantor's Violation") which may in any manner adversely affect Grantee's
Premises or any actions which Grantee may wish to undertake with respect thereto
pursuant to this Agreement. If Grantor has not, within thirty (30) days after it
receives notice of each such Grantor's Violation, cured such Grantor's
Violation, or if not susceptible of being cured within such thirty (30) day
period, if Grantor has not commenced diligently to prosecute a cure of such
Grantor's Violation
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and/or does not diligently prosecute such cure until completion, or, in the case
of an emergency immediately by verbal notice followed by written notice, Grantee
shall have the right, at Grantor's expense, to cure said Grantor's Violation
("Self Help Rights") and Grantor hereby grants to Grantee the right of access to
Grantor's Premises for such purpose. Grantor shall pay to Grantee on demand sums
equal to all costs incurred by Grantee as a result of the failure by Grantor to
cure Grantor's Violations, including all fines, penalties and expenses and
reasonable attorneys' fees and disbursements.
Section 5.3. The Parties acknowledge that their separate interests
require that tax assessments concerning their respective Premises be separate
and independent and that each Party shall be responsible for the payment of the
real estate taxes owing on their respective Premises. Each Party agrees, that in
the event the Department of Finance of the City of New York (the "Department of
Finance") has not issued permanent tax lot numbers for Grantor's Lot and
Grantee's Lot as of the Closing Date effectuating such separate and independent
treatment, it shall promptly perform such acts and execute and deliver such
documents as may reasonably be required in support of separate tax lot
treatment. In the intervening period following the Closing Date but prior to the
issuance of a tax bill reflecting the issuance of permanent tax lot numbers, the
Parties shall use best efforts to obtain an apportionment by the Department of
Finance of real property tax assessments and real property tax liens among
Grantee's Premises and Grantor's Premises and shall pay their respective
proportionate shares of the real estate taxes prior to the date upon which such
taxes would become delinquent. If the Parties are unable to obtain such an
apportionment from the Department of Finance, they shall apportion the real
estate taxes attributable to the Buildings, structures and equipment on their
respective Lots based on the most
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recent tax bill or, if such breakdown by structures and equipment is not
available, based on the original book cost as of the last calendar year end
preceding the taxable status date. The taxes attributable to land would be
allocated among the Parties based on the relative land area of their Lots. Upon
the issuance of permanent tax lot numbers for Grantee's Lot and Grantor's Lot
and for so long as the Lots remain as separate and independent tax lots, each
Party shall be free to institute tax certiorari proceedings with respect to its
Premises. At any time prior to the issuance by the Department of Finance of
separate, final tax lot numbers as aforesaid, the Parties shall cooperate with
each other in deciding whether to carry out and in instituting any such
certiorari proceedings.
ARTICLE VI. BINDING EFFECT
Section 6.1. Covenants Running with the Land. The benefits and
burdens, rights and obligations created by this Agreement shall be appurtenant
to and run with and burden and be binding upon the Lots, and shall inure to the
benefit of and be binding upon the Parties and those claiming by, through, or
under them until this Agreement shall terminate. The covenants, agreements,
terms, provisions and conditions of this Agreement shall bind and benefit the
successors in interest (as owners of the Lots, whether by sale, foreclosure or
otherwise) of the Parties, any party who joins in a Declaration of Zoning Lot
Restrictions for the purpose of enlarging or diminishing the Zoning Lot in
accordance with Article III hereof, and any such party's successors and assigns,
as the case may be, with the same effect as if mentioned in each instance when a
Party is named or referred to, it being understood and agreed that upon any
transfer of ownership (whether by sale, foreclosure or otherwise) of all or any
part of the Lots, each such successor in interest shall, without the requirement
of any further documentation,
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thereupon and thereafter assume, and perform and observe, any and all of the
obligations of its predecessors in interest under this Agreement with respect to
such Lot (or portion thereof). Notwithstanding the foregoing, each Party shall
use reasonable efforts to cause any such successor in interest to execute an
agreement in recordable form pursuant to which such successor in interest shall
assume any and all obligations of its predecessors in interest under this
Agreement; provided, however, that the failure to obtain any such agreement
shall not detract from the provisions of the previous sentence.
Section 6.2. Assignment. Neither this Agreement nor any of the
rights, interests and obligations hereunder shall be assigned by Grantee or
Grantor, except (1) to a party acquiring all or any portion of a Lot and this
Agreement or (2) to a lending institution or trustee in connection with a pledge
or granting of a security interest in all or any part of a Lot and this
Agreement, without the prior written consent of the other Party; and provided
further, that no assignment or transfer of rights or obligations by either Party
shall release it from the full liabilities and full financial responsibility, as
provided for under this Agreement, unless and until (x) the transferee or
assignee shall agree in writing to assume such obligations and duties, (y) the
other Party has consented in writing to such release, and (z) a counterpart of
the assumption agreement has been duly recorded in the Office of the New York
City Register for the County in which the Lots are located. To the extent that
rights hereunder are assigned to the holder of any mortgage encumbering the
Grantor's Premises, the Grantee's Premises, or any interest therein, they shall
be enforceable by any such assignee after default under any such mortgage.
Section 6.3. Zoning Lot Subdivision. Upon final approval by the
applicable Permitting Agency of the zoning lot subdivision separating Grantor's
Lot from the Zoning Lot,
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neither Grantee's Lot nor Grantor's Lot shall be subject to this Agreement,
which shall thereupon terminate. Notwithstanding the above, the rights and
obligations of Grantee and Grantor arising prior to said termination shall
survive the termination of this Agreement.
ARTICLE VII. MISCELLANEOUS
Section 7.1. Force Majeure.
(A) Notwithstanding anything in this Agreement to the contrary, no Party
shall have any liability or be otherwise responsible to the other for its
failure to carry out its obligations, with the exception of any obligation to
pay money, under this Agreement if and only to the extent that it becomes
impossible for either Party to so perform as a result of any occurrence or event
which is beyond the reasonable control, and does not result from any fault or
negligence, of the Party affected (each a "Force Majeure Event"), including any
act of God, strike or other labor disturbance, act of a public enemy, war, act
of terrorism, riot, any other civil disturbance, fire, storm, lightning, flood,
earthquake, any other natural disasters, explosion, materials shortage, breakage
or accident to machinery or equipment, any order or regulation or restriction
imposed by any court, administrative or regulatory agency or commission or other
governmental entity or instrumentality, domestic, foreign or supranational or
any department thereof (each a "Governmental Authority"), failure of a
contractor or subcontractor cause by a Force Majeure Event and transportation
delays and stoppages.
(B) If a Party shall rely on the occurrence of a Force Majeure Event as a
basis for being excused from performance of its obligations under this
Agreement, then the Party relying on such occurrence shall (i) provide prompt
written notice of such Force Majeure Event to the other
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Party(ies) giving an estimate of its expected duration and the probable impact
on the performance of its obligations hereunder, (ii) exercise its reasonable
best efforts to continue to perform its obligations under this Agreement, (iii)
expeditiously take action to correct or cure the Force Majeure Event (provided
that settlement of strikes or any other labor dispute will be completely within
the sole discretion of the Party affected by such strike or labor dispute), (iv)
exercise its reasonable best efforts to mitigate or limit damages to the other
Party and (v) provide prompt notice to the other Party(ies) of the cessation of
the Force Majeure Event.
Section 7.2. Default and Remedies. In the event that a Party
defaults, breaches or otherwise fails to perform any obligation of such Party
under this Agreement, the other Party shall have the right to all remedies
available at law or in equity, including the right to injunctive relief and the
right to exercise its Self-Help Rights (and shall be entitled to correlative
reimbursement in connection therewith) without any requirement to pursue or
exhaust any other remedies available to such Party under any other agreement.
All such remedies shall be cumulative and not exclusive. A Party shall have the
right, following notice to the other Party, to take such action as it may deem
necessary or advisable, including payment of any delinquent taxes, to prevent a
foreclosure for nonpayment of taxes or other action by a Governmental Authority
that might affect its rights and interests hereunder and any such action shall
be deemed an exercise of Self-Help Rights (and, accordingly, give rise to
correlative reimbursement rights). The right to reimbursement shall not include
the right to recover punitive or consequential damages. In the event a Party is
entitled to reimbursement hereunder and same is not satisfied within thirty (30)
days after written demand by the Party entitled to same, the unpaid obligations
shall constitute a lien against the defaulting Party's Lot; provided, however,
that the payment of
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any monetary obligations which become due and payable by a Party after
recordation of a mortgage on such Party's Lot granted to an independent third
party regularly engaged in the business of making mortgage loans shall be
subordinate to the payment of the obligations secured by such mortgage.
Section 7.3. Recording. Grantee shall record this Agreement
immediately after the execution of this Agreement and Grantee's acquisition of
Grantee's Lot and shall bear the costs of recording.
Section 7.4. Notices. All notices, demands, requests and other
communications required hereunder shall be in writing and shall be deemed to
have been given (as of the time of delivery or, in the case of a telecopied
communication, of confirmation) if delivered personally, telecopied (which is
confirmed) or sent by overnight courier (providing proof of delivery) to the
Parties at the following addresses (or at such other addresses for a Party as
shall be specified by like notice):
To Grantee:
Astoria Generating Company, L.P.
c/o Orion Power New York GP II, Inc.
111 Market Place
Suite 520
Baltimore, MD 21202
Telecopy No.: (410) 468-3699
Attention: General Counsel
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with a copy to:
Thelen Reid & Priest LLP
Two Embarcadero Center
Suite 2100
San Francisco, CA 94111
Telecopy No.: (415) 421-1068
Attention: Thomas B. Glascock, Esq.
To Grantor:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attn: Director of Real Estate
with a copy to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attn: Senior Vice President and General Counsel
or at such other address in the United States of America as may be designated by
any of the Parties in a written notice given in accordance with the provisions
of this Section 7.4. The attorney for any Party may send notices on that Party's
behalf.
Section 7.5. Estoppel Certificate. Each Party agrees, within ten
(10) days after written request by the other, to execute, acknowledge and
deliver to and in favor of any present or proposed lender, Mortgagee, ground
lessor, purchaser, tenant or the like of all or any part of the other Party's
Lot, an estoppel certificate, in a form reasonably satisfactory to such lender,
Mortgagee, ground lessor, purchaser, tenant or the like, stating, among other
things: (i) whether this Agreement is in full force and effect; (ii) whether
this Agreement has been modified or amended and, if so, identifying and
describing any such modification or amendment;
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(iii) whether there are any sums then due and owing under this Agreement from
either Party to the other, and if so, specifying the amount thereof and reason
therefor; and (iv) whether the Party giving such certificate knows of any
default (or event which, with the passage of time, the giving of notice, or
both, would constitute a default) on the part of the other Party, or has any
outstanding claim against the other Party arising under this Agreement and, if
so, specifying the nature of such default or claim.
Section 7.6. Waivers by Subsequent Parties-in-Interest. If an
interest attaches to either Party's Premises subsequent to the date hereof which
would otherwise confer upon the holder of such interest the status of a
Party-in-Interest, any modification, amendment or termination of this Agreement
that is entered into for the purpose of enlarging or subdividing the Zoning Lot
or for the purpose of modifying or terminating the provisions of this Agreement
as they affect the Zoning Lot, as it may be enlarged or diminished, may be
executed without the joinder, waiver, consent or other act of the holder of such
interest. Notwithstanding the foregoing, the affected Party shall obtain from
such holder a waiver of execution of any subsequent amendments to this Agreement
and to subordinate its interest to such Agreement, as it may be amended.
Section 7.7. Mortgagees' Status. Except as set forth in Section 7.2
hereof, the Parties intend that this Agreement be superior to any mortgages or
other instruments evidencing security for indebtedness granted by either Party
from time to time with respect to its Lot. Accordingly, each Party agrees to
obtain and deliver to the other Party such documents and instruments, in
recordable form, as may be reasonably necessary or requested by the other Party
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to evidence and confirm the subordination of any such mortgages or other
security instruments to the provisions of this Agreement.
Section 7.8. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same original, and the execution of separate counterparts by either Grantee or
Grantor shall bind Grantee and Grantor as if they had each executed the same
counterpart.
Section 7.9. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law).
Section 7.10. Extension; Waiver. Any Party may extend the time for
performance of any of the obligations or other acts of the other Party or waive
compliance by the other Party with any of the agreements or conditions contained
in this Agreement. Any agreement on the part of a Party to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such Party. The failure of a Party to this Agreement to assert any of
its rights under this Agreement or otherwise shall not constitute a waiver of
such rights.
Section 7.11. No Third Party Beneficiaries. Nothing in this
Agreement is intended to confer upon any other person except the Parties any
rights or remedies hereunder or shall create any third party beneficiary rights
in any person.
Section 7.12. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect.
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Upon such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the Parties shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the Parties as closely as
possible to the fullest extent permitted by applicable law in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to the
extent possible.
Section 7.13. Amendment and Modification. This Agreement may be
amended, modified or supplemented only by an instrument in writing signed on
behalf of the owners from time to time of each Lot.
Section 7.14. Jurisdiction and Enforcement.
(A) Each of the Parties irrevocably submits to the exclusive jurisdiction
of (i) the Supreme Court of the State of New York, New York County and (ii) the
United States District Court for the Southern District of New York, for the
purposes of any suit, action or other proceeding arising out of this Agreement
or any transaction contemplated hereby. Each of the Parties agrees to commence
any action, suit or proceeding relating hereto either in the United States
District Court for the Southern District of New York or, if such suit, action or
proceeding may not be brought in such court for jurisdictional reasons, in the
Supreme Court of the State of New York, New York County. Each of the Parties
further agrees that service of process, summons, notice or document by hand
delivery or U.S. registered mail at the address specified for such Party in
Section 7.4 (or such other address specified by such Party from time to time
pursuant to Section 7.4) shall be effective service of process for any action,
suit or proceeding brought against such Party in any such court. Each of the
Parties irrevocably and unconditionally waives any objection to the laying of
venue of any action, suit or proceeding arising out of this
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177
Agreement or the transactions contemplated hereby in (i) the Supreme Court of
the State of New York, New York County or (ii) the United States District Court
for the Southern District of New York, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum.
(B) The Parties agree that irreparable damage would occur in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or otherwise breached. It is accordingly agreed that
the Parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement, this being in addition to any other remedy to which they are
entitled at law or in equity.
Section 7.15. Interpretation. When a reference is made in this
Agreement to an Article, Section, Schedule or Exhibit, such reference shall be
to an Article or Section of, or Schedule or Exhibit to, this Agreement unless
otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation". The words "hereof, "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement. All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein. The definitions contained in this Agreement
are applicable to
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the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such term. Any agreement,
instrument, statute, regulation, rule or order defined or referred to herein or
in any agreement or instrument that is referred to herein means such agreement,
instrument, statute, regulation, rule or order as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes, regulations, rules or orders)
by succession of comparable successor statutes, regulations, rules or orders and
references to all attachments thereto and instruments incorporated therein.
References to a person are also to its permitted successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement.
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.,
By: _______________________________
Name: Joan S. Freilich
Title: Executive Vice President
and CFO
ASTORIA GENERATING COMPANY, L.P.,
By: ORION POWER NEW YORK GP II, INC.,
By: ___________________________
Name:
Title:
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179
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this __ day of _______ 1999, before me personally appeared Joan
S. Freilich, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
________________________________
NOTARY PUBLIC
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On this __ day of ________ 1999, before me personally appeared ______________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity, and that his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
________________________________
NOTARY PUBLIC
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180
EXHIBIT B-1
[ASTORIA GENERATING STATION]
Form 3264 Standard N Y S T U Form 8001 -Bargain and Sale Deed, without Covenant
against Grantor's Acts-Individual or Corporate (Single Sheet)
CONSULT YOUR LAWYER BEFORE SIGNING THIS INSTRUMENT--THIS INSTRUMENT SHOULD BE
USED BY LAWYERS ONLY.
--------------------
THIS INDENTURE, made the day of , 1999
BETWEEN
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC., a New York corporation, having an
address at 4 Irving Place, New York, New York 10003.
party of the first part, and
[PURCHASER OF BUNDLE 3], a __________________, having an address at
__________________.
party of the second part,
WITNESSETH, that the party of the first part, in consideration of ten ($10)
dollars and other valuable consideration paid by the party of the second part,
does hereby grant and release unto the party of the second part, the heirs or
successors and assigns of the party of the second part forever,
ALL that certain plot, piece or parcel of land, with the buildings and
improvements thereon erected, situate, lying and being in the County of Queens,
in the City and State of New York, as more fully described in the attached
Exhibit A.
TOGETHER with all right, title and interest, if any, of the party of the first
part in and to any streets and roads abutting the above described premises to
the center lines thereof; TOGETHER with the appurtenances and all the estate and
rights of the party of the first part in and to said premises: TO HAVE AND TO
HOLD the premises herein granted unto the party of the second part, the heirs or
successors and assigns of the party of the second part forever.
AND the party of the first part, in compliance with Section 13 of the Lien Law,
covenants that the party of the first part will receive the consideration for
this conveyance and will hold the right to receive such consideration as a trust
fund to be applied first for the purpose of paying the cost of the improvement
and will apply the same first to the payment of the cost of the improvement
before using any part of the total of the same for any other purpose. The word
"party" shall be construed as if it read "parties" whenever the sense of this
indenture so requires.
IN WITNESS WHEREOF, the party of the first part has duly executed this deed the
day and year first above written.
IN PRESENCE OF:
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
By: ____________________________________
Name:
Title
181
STATE OF NEW YORK, COUNTY OF ss: STATE OF NEW YORK, COUNTY OF ss:
On the day of 19 , before On the day of 19 , before
me personally came me personally came
to me known to be the individual to me known to be the individual
described in and who executed described in and who executed
the foregoing instrument, and the foregoing instrument, and
acknowledged that executed the acknowledged that executed the
same. same.
____________________
____________________
STATE OF NEW YORK, COUNTY OF ss: STATE OF NEW YORK, COUNTY OF ss:
On the day of 19 , before On the day of 19 , before
me personally came me personally came
to me known, who, being by me duly the subscribing witness to the
sworn, did depose and say that he foregoing instrument, with whom I am
resides at personally acquainted, who, being by
me duly sworn, did depose and say that
that he is the he resides at
of
, the corporation
described in and which executed the ; that he knows
foregoing instrument; that he knows to be the individual
the seal of said corporation; that described in and who executed the
the seal affixed to said instrument foregoing instrument; that he, said
is such corporate seal; that it was subscribing witness, was present and saw
so affixed by order of the board of
directors of said corporation, and execute the same; and that he,
that he signed his name thereto by
like order. said witness, at the same time subscribed
h name as witness thereto.
____________________
____________________
*See attached notary block
BARGAIN AND SALE DEED
WITHOUT COVENANT AGAINST GRANTOR'S ACTS SECTION
BLOCK
Title No. _______________________ LOT *See attached Exhibit B
COUNTY OR TOWN
CONSOLIDATED EDISON COMPANY STREET ADDRESS
OF NEW YORK, INC.
Recorded at Request of
TO COMMONWEALTH LAND TITLE INSURANCE
COMPANY
RETURN BY MAIL TO
______________________________________
___________________________________
Standard Form of New York Board of
Underwriters
Distributed by
Commonwealth
___________________________________ ______________________________________
________________________________________________________________________________
RESERVE THIS SPACE FOR USE OF RECORDING OFFICE
________________________________________________________________________________
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182
EXHIBIT A
Legal Description
I. Legal Description of Astoria Generating Station
II. Legal Description of Tank Farm
183
EXHIBIT B
ASTORIA GENERATING STATION
SECTION 6
BLOCK 850
LOT Part of 1 [Subject to Change]
COUNTY OR TOWN Queens
STREET ADDRESS 20th Avenue, Astoria, New York
(No specific street address given; therefore, see Tax Map,
attached as Exhibit C)
TANK FARM
SECTION 6
BLOCK 850
LOT Part of 1 [Subject to Change]
COUNTY OR TOWN Queens
STREET ADDRESS Interior Parcel, North of 20th Avenue,
Astoria, New York
(No specific street address given; therefore, see Map,
attached as Exhibit D. Note: this map is not a tax map.)
184
EXHIBIT C
TAX MAP
ASTORIA GENERATING STATION
(SEE ATTACHED)
185
EXHIBIT D
MAP
TANK FARM
(SEE ATTACHED)
Note: this map is not a tax map.
186
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On the __ day of _____ in the year 199_ before me, the undersigned, a
Notary Public in and for said State, personally appeared
____________________________, personally known to me or proved to me on the
basis of satisfactory evidence to be the individual whose name is subscribed to
the within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
________________________________________
Notary Public
187
EXHIBIT B-2
[NARROWS GAS TURBINE SITE & GOWANUS GAS TURBINE SITE]
Form 3264 Standard NY S T U Form 8001 -Bargain and Sale Deed, without Covenant
against Grantor's Acts-Individual or Corporate (Single Sheet)
CONSULT YOUR LAWYER BEFORE SIGNING THIS INSTRUMENT--THIS INSTRUMENT SHOULD BE
USED BY LAWYERS ONLY.
--------------------
THIS INDENTURE, made the day of , 1999
BETWEEN
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC., a New York corporation, having an
address at 4 Irving Place, New York, New York 10003.
party of the first part, and
[PURCHASER OF BUNDLE 3], a __________________, having an address at
________________________.
party of the second part,
WITNESSETH, that the party of the first part, in consideration of ten ($10)
dollars and other valuable consideration paid by the party of the second part,
does hereby grant and release unto the party of the second part, the heirs or
successors and assigns of the party of the second part forever,
ALL that certain plot, piece or parcel of land, with the buildings and
improvements thereon erected, situate, lying and being in the County of Kings,
City and State of New York, as more fully described in the attached Exhibit A.
TOGETHER with all right, title and interest, if any, of the party of the first
part in and to any streets and roads abutting the above described premises to
the center lines thereof; TOGETHER with the appurtenances and all the estate and
rights of the party of the first part in and to said premises: TO HAVE AND TO
HOLD the premises herein granted unto the party of the second part, the heirs or
successors and assigns of the party of the second part forever.
AND the party of the first part, in compliance with Section 13 of the Lien Law,
covenants that the party of the first part will receive the consideration for
this conveyance and will hold the right to receive such consideration as a trust
fund to be applied first for the purpose of paying the cost of the improvement
and will apply the same first to the payment of the cost of the improvement
before using any part of the total of the same for any other purpose. The word
"party" shall be construed as if it read "parties" whenever the sense of this
indenture so requires.
IN WITNESS WHEREOF, the party of the first part has duly executed this deed the
day and year first above written.
IN PRESENCE OF:
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
By: ____________________________________
Name:
Title:
188
STATE OF NEW YORK, COUNTY OF ss: STATE OF NEW YORK, COUNTY OF ss:
On the day of 19 , before On the day of 19 , before
me personally came me personally came
to me known to be the individual to me known to be the individual
described in and who executed described in and who executed
the foregoing instrument, and the foregoing instrument, and
acknowledged that executed the acknowledged that executed the
same. same.
____________________
____________________
STATE OF NEW YORK, COUNTY OF ss: STATE OF NEW YORK, COUNTY OF ss:
On the day of 19 , before On the day of 19 , before
me personally came me personally came
to me known, who, being by me duly the subscribing witness to the
sworn, did depose and say that he foregoing instrument, with whom I am
resides at personally acquainted, who, being by
me duly sworn, did depose and say that
that he is the he resides at
of
, the corporation
described in and which executed the ; that he knows
foregoing instrument; that he knows to be the individual
the seal of said corporation; that described in and who executed the
the seal affixed to said instrument foregoing instrument; that he, said
is such corporate seal; that it was subscribing witness, was present and saw
so affixed by order of the board of
directors of said corporation, and execute the same; and that he,
that he signed his name thereto by
like order. said witness, at the same time subscribed
h name as witness thereto.
____________________
____________________
*See attached notary block
BARGAIN AND SALE DEED
WITHOUT COVENANT AGAINST GRANTORS ACTS SECTION
BLOCK
Title No. _______________________ LOT *See attached Exhibit B
COUNTY OR TOWN
CONSOLIDATED EDISON COMPANY STREET ADDRESS
OF NEW YORK, INC.
Recorded at Request of
TO COMMONWEALTH LAND TITLE INSURANCE
COMPANY
RETURN BY MAIL TO
______________________________________
___________________________________
Standard Form of New York Board of
Underwriters
Distributed by
Commonwealth
___________________________________ ______________________________________
________________________________________________________________________________
RESERVE THIS SPACE FOR USE OF RECORDING OFFICE
________________________________________________________________________________
-2-
189
EXHIBIT A
Legal Descriptions
I. Legal Description of Narrows Gas Turbine Site
II. Legal Description of Gowanus Gas Turbine Site
190
EXHIBIT B
NARROWS GAS TURBINE SITE
SECTION: 3
BLOCK: 803
LOTS: 10 & 150
COUNTY OR TOWN: Kings
STREET ADDRESS: 1st Avenue, Brooklyn, New York
(No specific street address given; therefore, see Tax Map,
attached as Exhibit C)
GOWANUS GAS TURBINE SITE
SECTION: 3
BLOCK: 653
LOT: 3
COUNTY OR TOWN: Kings
STREET ADDRESS: 3rd Avenue, 25th Street, 26th Street, 27th Street and
28th Street, Brooklyn, New York
(No specific street address given; therefore, see Tax Map,
attached as Exhibit D)
191
EXHIBIT C
TAX MAP
NARROWS GAS TURBINE SITE
(SEE ATTACHED)
192
EXHIBIT D
TAX MAP
GOWANUS GAS TURBINE SITE
(SEE ATTACHED)
193
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On the __ day of _____ in the year 199_ before me, the undersigned, a
Notary Public in and for said State, personally appeared
____________________________, personally known to me or proved to me on the
basis of satisfactory evidence to be the individual whose name is subscribed to
the within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
________________________________________
Notary Public
194
EXHIBIT C
CERTIFICATION OF NON-FOREIGN STATUS
Section 1445 of the Internal Revenue Code of 1986, as amended (the
"Code"), provides that a transferee of a U.S. real property interest must
withhold tax if the transferor is a foreign person. To inform Astoria Generating
Company, L.P. ("Buyer"), that a withholding of tax is not required upon the
disposition of a U.S. real property interest by Consolidated Edison Company of
New York, Inc., a New York corporation ("Con Ed"), the undersigned hereby
certifies the following on behalf of Con Ed:
1. Con Ed is not a foreign corporation, foreign partnership, foreign
trust or foreign estate (as those terms are defined in the Code and Income Tax
Regulations);
2. Con Ed's employer identification number is 13-5009340;
3. Con Ed's office address is 4 Irving Place, New York, NY 10003.
Con Ed and the undersigned understand that this certificate may be
disclosed to the Internal Revenue Service by Buyer and that any false statement
contained herein could be punished by fine, imprisonment or both.
Under penalty of perjury, I declare that I have examined this
certificate and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of Con Ed.
Date: By: ____________________________________
Name: __________________________________
Title: _________________________________
195
EXHIBIT D
FORM OF OPINION OF GENERAL COUNSEL TO SELLER
, 1999
[Insert Buyer's Name and Address]
Consolidated Edison Company of New York, Inc.
Generating Plant and Gas Turbine
Asset Purchase and Sale Agreement
Ladies and Gentlemen:
I am General Counsel of Consolidated Edison Company of New York,
Inc., a New York corporation ("Seller"), and have acted for Seller in connection
with the Generating Plant and Gas Turbine Asset Purchase and Sale Agreement (the
"Asset Purchase and Sale Agreement") dated as of March 2, 1999, between Seller
and Astoria Generating Company, L.P., a Delaware limited partnership ("Buyer"),
the Continuing Site Agreements, the Declaration of Easements Agreements, the
Declarations of Subdivision Easements, the Zoning Lot Development Agreements,
the other Ancillary Agreements (collectively, the "Agreements") and the
transactions contemplated thereby. Capitalized terms used but not defined herein
have the meanings assigned to them in the Asset Purchase and Sale Agreement.
In that connection, I have examined originals, or copies certified
or otherwise identified to my satisfaction, of such documents, corporate records
and other instruments as I have deemed necessary or appropriate for the purposes
of this opinion, including: (a) the Agreements, (b) the Certificate of
Incorporation of Seller, (c) the By-laws of Seller and (d) resolutions of the
Board of Trustees of Seller.
In rendering my opinion, I have assumed the due authorization,
execution and delivery of each Agreement by each party thereto other than
Seller.
Based upon the foregoing and subject to the qualifications
hereinafter set forth, I am of the opinion as follows:
1. Based solely on a certificate from the Secretary of State of the
State of New York, Seller is a
196
2
corporation validly existing and in good standing under the laws of the State of
New York. Seller has all necessary corporate power and authority to execute and
deliver each Agreement and to consummate the transactions contemplated thereby;
and the execution and delivery by Seller of each Agreement and the consummation
by Seller of the transactions contemplated thereby have been duly and validly
authorized by all necessary corporate action on the part of Seller.
2. Each Agreement has been duly executed and delivered by Seller,
and assuming that such Agreement constitutes a valid and binding obligation of
each other party thereto, subject to the receipt of all required regulatory
approvals, such Agreement constitutes a valid and binding obligation of Seller,
enforceable against Seller in accordance with its terms (subject to applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
other similar laws affecting creditors' rights generally from time to time in
effect and to general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing, regardless
of whether considered in a proceeding in equity or at law). With respect to the
foregoing opinion, (i) insofar as provisions contained in the Agreements provide
for indemnification, the enforceability thereof may be limited by public
policy considerations and (ii) the availability of a decree for specific
performance or an injunction is subject to the discretion of the court requested
to issue any such decree or injunction.
3. Neither the execution and delivery of the Agreements by Seller
nor the sale by Seller of the Auctioned Assets will (i) conflict with or result
in a breach of the Certificate of Incorporation or By-laws of Seller, (ii)
result in a default (or give rise to any right of termination, cancelation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, agreement, lease or other instrument or
obligation to which Seller is a party or by which Seller, or any of the
Auctioned Assets may be bound, except for such defaults (or rights of
termination, cancelation or acceleration) as to which requisite waivers or
consents have been obtained or which would not, individually or in the
aggregate, create a Material Adverse Effect or (iii) violate any order, writ,
injunction, decree, statute, rule or regulation applicable to Seller, or the
Auctioned Assets, except for such violations which would not, individually or in
the aggregate, create a Material Adverse Effect.
4. Except for the Seller Required Regulatory Approvals, no
declaration, filing or registration with, or
197
3
notice to, or authorization, consent or approval of any United States Federal or
New York State Governmental Authority is necessary for the consummation by
Seller of the transactions contemplated by the Agreements, other than such
declarations, filings, registrations, notices, authorizations, consents or
approvals (i) which, if not obtained or made, would not, individually or in the
aggregate, create a Material Adverse Effect or (ii) which relate to the
Transferable Permits.
The opinions expressed herein are subject to the qualification that
I express no opinion regarding the applicability of, or compliance with, any
bulk sales, bulk transfer or similar laws in connection with the transfer of the
Auctioned Assets pursuant to the Asset Purchase and Sale Agreement. I express no
opinion herein as to (i) the provisions of the Agreements insofar as such
provisions relate to the subject matter jurisdiction of the United States
District Court for the Southern District of New York to adjudicate any
controversy related thereto and (ii) the waiver of an inconvenient forum set
forth in the provisions of the Agreements.
I am admitted to practice in the State of New York, and I express no
opinion as to matters governed by any laws other than the laws of the State of
New York and the Federal laws of the United States of America.
I am furnishing this opinion to you pursuant to Section 8.02(e)(iii)
of the Asset Purchase and Sale Agreement, solely for your benefit in connection
with the transactions contemplated by the Asset Purchase and Sale Agreement.
This opinion may not be relied upon by any other person or for any other purpose
or used, circulated, quoted or otherwise referred to for any other purpose.
Very truly yours,
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EXHIBIT E
FORM OF OPINION OF COUNSEL TO BUYER
, 1999
Consolidated Edison Company
of New York, Inc.
4 Irving Place
New York, NY 10003
Generating Plant and Gas Turbine
Asset Purchase and Sale Agreement
Ladies and Gentlemen:
We have acted as counsel to Astoria Generating Company, L.P., a
Delaware limited partnership ("Buyer"), in connection with the Generating Plant
and Gas Turbine Asset Purchase and Sale Agreement (the "Asset Purchase and Sale
Agreement") dated as of March 2, 1999, between Buyer and Consolidated Edison
Company of New York, Inc., a New York corporation ("Seller"), the Continuing
Site Agreements, the Declaration of Easements Agreements, the Zoning Lot
Development Agreements (collectively, the "Agreements") and the transactions
contemplated thereby. Capitalized terms used but not defined herein have the
meanings assigned to them in the Asset Purchase and Sale Agreement.
In that connection, we have examined originals, or copies certified
or otherwise identified to our satisfaction, of such documents, corporate
records and other instruments as we have deemed necessary or appropriate for the
purposes of this opinion, including: (a) the Agreements, (b) the Certificate of
Incorporation and By-laws (or other similar governing documents) of Buyer and
(c) resolutions of the Board of Directors of Buyer.
In rendering our opinion, we have assumed the due authorization,
execution and delivery of each Agreement by each party thereto other than Buyer.
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Based upon the foregoing and subject to the qualifications
hereinafter set forth, we are of the opinion as follows:
1. Buyer is a limited partnership validly existing and in good
standing under the laws of the State of Delaware. Buyer has all necessary
power and authority to execute and deliver each Agreement and to consummate the
transactions contemplated thereby; and the execution and delivery by Buyer of
each Agreement and the consummation by Buyer of the transactions contemplated
thereby have been duly and validly authorized by all necessary action on the
part of the general partner of Buyer.
2. Each Agreement has been duly executed and delivered by Buyer, and
assuming that such Agreement constitutes a valid and binding obligation of each
other party thereto, subject to the receipt of all required regulatory
approvals, such Agreement constitutes a valid and binding obligation of Buyer,
enforceable against Buyer in accordance with its terms (subject to applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
other similar laws affecting creditors' rights generally from time to time in
effect and to general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing, regardless
of whether considered in a proceeding in equity or at law). With respect to the
foregoing opinion, (i) insofar as provisions contained in the Agreements provide
for indemnification, the enforceability thereof may be limited by public policy
considerations and (ii) the availability of a decree for specific performance or
an injunction is subject to the discretion of the court requested to issue any
such decree or injunction.
3. Neither the execution and delivery of the Agreements nor the
purchase by Buyer of the Auctioned Assets will (i) conflict with or result in a
breach of the limited partnership agreement (or other similar governing
documents) of Buyer, (ii) result in a default (or give rise to any right of
termination, cancelation or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, agreement, lease or
other instrument or obligation to which Buyer or any of its subsidiaries is a
party or by which any of their respective assets may be bound or (iii) violate
any order, writ, injunction, decree, statute, rule or regulation applicable to
Buyer, or any of its assets, except in the case of clauses (ii) and (iii) for
such failures to obtain a necessary consent, defaults and violations which would
not, individually or in the aggregate, have a material adverse
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effect on the ability of Buyer to consummate the transactions contemplated by,
and discharge its obligations under, the Asset Purchase and Sale Agreement and
the Agreements.
4. Except for the Buyer Required Regulatory Approvals, no
declaration, filing or registration with, or notice to, or authorization,
consent or approval of any Governmental Authority is necessary for the
consummation by Buyer of the transactions contemplated by the Agreements.
We express no opinion herein as to (i) the provisions of the
Agreements insofar as such provisions relate to the subject matter jurisdiction
of the United States District Court for the Southern District of New York to
adjudicate any controversy related thereto and (ii) the waiver of an
inconvenient forum set forth in the provisions of the Agreements.
We are furnishing this opinion to you pursuant to Section 8.03(d) of
the Asset Purchase and Sale Agreement, solely for your benefit in connection
with the transactions contemplated by the Asset Purchase and Sale Agreement.
This opinion may not be relied upon by any other person or for any other purpose
or used, circulated, quoted or otherwise referred to for any other purpose.
Very truly yours,
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EXHIBIT F
A-10 NON-EXCLUSIVE DOCK LICENSE (THE "LICENSE")
SUMMARY OF TERMS AND CONDITIONS
Licensor: Seller.
Licensee: Buyer.
Licensed Premises: A-10 Dock and related appurtenances located adjacent to
Seller's property.
Licensed Term: Twenty (20) years.
Renewal Term: Licensee may renew for four (4) 20-year periods, in each
case by providing at least one hundred eighty (180)
days' prior written notice to Licensor.
Use: Licensee has a non-exclusive right to use the Licensed
Premises in connection with its operation of the Astoria
Generating Plants or any replacement power generation
facility located at the Astoria site owned by it or any
successor.
Improvements
And Alternations: Licensee will not make any improvements or alternations
to the Licensed Premises without the prior written
consent of Licensor.
Non-Exclusivity: Licensed Premises may also be used by Licensor and other
owners or tenants at the Astoria site.
Option to Terminate: Licensee has right to terminate in its sole discretion
on one hundred twenty (120) days' prior written notice.
Revocation: Licensor has the right to revoke in the event that
Licensee no longer operates the Astoria Generating
Plants as a power generation facility. Licensor has the
right to revoke the License for cause, which cause for
revocation continues uncured through the expiration of
any applicable grace period.
License Fee: The License is granted free of charge.
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Economic Obligations
of Licensee: The Licensee will pay the property taxes and be
responsible for all maintenance expenses on the Licensed
Premises.
Environmental
Liabilities: Except as specified in the following sentence, as
between Licensor and Licensee, Licensee shall be
responsible and liable for, and indemnity and hold
Licensor harmless from, all Environmental Liabilities
under any Environmental Law relating to the Licensed
Premises and arising out of or in connection with the
Licensee's use of, or operations at, the Licensed
Premises during the License Term. As between Licensor
and Licensee, Licensor shall be responsible and liable
for, and indemnity and hold harmless Licensee from, all
Environmental Liabilities under any Environmental Law
relating to the Licensed Premises and arising out of or
in connection with the Licensor's use of, or operations
at, the Licensed Premises during the License Term or
with events or conditions which (i) existed prior to the
commencement of the License Term or (ii) arise after the
expiration of the License Term (and any Renewal Term
Maintenance: The Licensee agrees to maintain the Licensed Premises in
the condition existing at the commencement of the
initial License Term. The Licensee will maintain and
repair the Licensed Premises in accordance with Good
Industry Practice but will not be responsible for
repairs required by damage to the Licensed Premises
caused by others.
Insurance: Unless waived by Licensor (in which case Licensor shall
obtain such insurance itself), Licensee shall maintain
and keep in full force and effect the following
insurance, subject to commercially reasonable terms,
with respect to the Licensed Premises:
o general comprehensive liability insurance
including contractual liability with limits of at
least $5 million per occurrence for bodily injury
and at least $1 million per occurrence for
property damage or a combined single limit of
$5,000,000 per occurrence;
o statutory workers' compensation insurance as
required by law, and employer's liability
insurance, including in respect of accidents (with
a limit of at least $500,000 per accident) and
occupation diseases (with a limit of at
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least $500,000 per employee); and
o property casualty insurance (with subrogation
waived against Licensor) in such amounts as are
agreed between Licensor and Licensee.
Such insurance shall have such deductibles and
retentions and be underwritten by such companies (to be
approved by Licensor) as would be obtained by a
reasonably prudent electric power business and shall be
primary and noncontributory with any insurance carried
by Licensor and shall not require that Licensor pay any
premium thereunder. Licensor will be named as an
additional insured under the general comprehensive
liability insurance policy and as a loss payee on the
property casualty insurance policy. Licensee may
self-insure against any of the liabilities set forth
above if Licensee satisfies all applicable statuary and
regulatory criteria with respect to the self-insurance
of the relevant liability.
Indemnification: The indemnification rights and obligations under the
License will be governed by the indemnification
provisions of Asset Purchase and Sale Agreement.
Fire Protection: Licensee shall maintain any person-in-charge building(s)
located at the Licensed Premises, will be required to
(upon request) provide one or more locations at the
Licensed Premises for mooring vessel(s) of the New York
City Fire Department ("FDNY") and will be responsible
for promptly installing its own FDNY-approved fire
protection systems at the Licensed Premises separate
from those of Licensor (at the expiration or termination
of the License, such separate fire protection systems
will be abandoned, not removed). Until the earlier of
the completion of such separate fire protection systems
or December 31, 2000, the Licensor will continue to
provide to Licensee free of charge, but without
liability for the failure or malfunction thereof, access
to and use of its existing saltwater fire protection
system at the Licensed Premises. After the earlier of
December 31, 2000 or the installation of Licensee's
separate fire protection systems at the Licensed
Premises, the ties to Licensor's existing saltwater fire
protection system at the Licensed Premises will be
severed.
To the extent that the FDNY does not permit such
separation by the date specified in the preceding
sentence, then Licensee will pay an annual fee for each
year or any part of each year in
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which Licensor is required to continue the access and
use described in this section.
Assignment and
Sublicensing: Licensee may not assign or sublicense its rights or
obligations under the License without the prior written
consent of Licensor.
End of License
Obligations: At the expiration or revocation of the License, Licensee
will vacate the Licensed Premises and leave the Licensed
Premises in the condition existing at the commencement
of the License Term.
Permits: Licensee will hold all permits necessary to conduct its
operations at or in connection with the Licensed
Premises and will be responsible for compliance with
same. Such permits include oil spill response plans and
certificates of financial responsibility to the extent
required under the Oil Pollution Act of 1990, as
amended.
Governing Law: New York.
TERMS USED BUT NOT DEFINED HEREIN SHALL HAVE THE MEANINGS ASSIGNED THERETO IN
THE GENERATING PLANT AND GAS TURBINE ASSET PURCHASE AND SALE AGREEMENT TO WHICH
THIS EXHIBIT F IS ATTACHED.
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EXHIBIT G
TRANSITION CAPACITY AGREEMENT
BETWEEN
*
AND
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
Dated as of *, 1999
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i
TABLE OF CONTENTS
Page
----
1. DEFINITIONS .............................................................2
2. EFFECTIVENESS, TERM AND TERMINATION .....................................4
3. CAPABILITY AND AVAILABILITY REQUIREMENTS ................................5
4. INSTALLED CAPACITY PURCHASE, QUANTITY AND PAYMENTS ......................6
5. SCHEDULING ..............................................................8
6. BILLING AND PAYMENT PROCEDURES ..........................................8
7. FORCE MAJEURE ...........................................................9
8. ASSIGNMENT; NO THIRD PARTY BENEFICIARIES ...............................10
9. EXTENSION; WAIVER ......................................................11
10. COUNTERPARTS ...........................................................11
11. GOVERNING LAW ..........................................................11
12. SEVERABILITY ...........................................................11
13. AMENDMENT ..............................................................11
14. ENTIRE AGREEMENT .......................................................12
15. FURTHER ASSURANCES .....................................................12
16. INDEPENDENT CONTRACTOR STATUS ..........................................12
17. NOTICES ................................................................13
18. INTERPRETATION .........................................................13
19. JURISDICTION AND ENFORCEMENT ...........................................14
20. CONFLICT ...............................................................14
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TRANSITION CAPACITY AGREEMENT BETWEEN * AND CONSOLIDATED
EDISON COMPANY OF NEW YORK, INC.
This Transition Capacity Agreement ("Agreement") is made and entered into
as of this * day of * 1999, by and between * ("ABC"), a * corporation, and
Consolidated Edison Company of New York, Inc. ("Con Edison"), a New York
corporation. ABC and Con Edison shall each be referred to as a "Party", and
shall be referred to collectively as the "Parties."
WHEREAS, ABC and Con Edison have entered into a Generating Plant and Gas
Turbine Asset Purchase and Sale Agreement (the "APA") and certain other
agreements specified in the APA relating to the purchase by ABC of certain of
Con Edison's generating assets comprised of Generating Plants and Gas Turbines
(each as defined in the APA) (collectively, the "Purchased Assets");
WHEREAS, the rights and obligations of buyers and providers of electric
generating capacity, energy, transmission and ancillary services may be modified
by a proposal (the "Proposal") currently pending before the Federal Energy
Regulatory Commission ("FERC") to restructure the New York Power Pool, which
Proposal contemplates, among other things, (i) the formation of the ISO (as
defined) and (ii) the implementation of the ISO Tariff filed on December 19,
1997, in FERC Docket Nos. ER97-1523-000, OA97-470-000 and ER97-4234-000, as such
filings may be amended from time-to-time;
WHEREAS, FERC may approve, accept, modify, or reject the Proposal, and its
actions may affect the rights and obligations of the Parties under this
Agreement;
WHEREAS, FERC has accepted for filing certain market power mitigation
measures applicable to sales of capacity, energy and certain other services from
specified electric generating units in New York City in FERC Docket No.
ER98-3169-000 (such measures, as may be modified from time to time, and any
other applicable market power mitigation measures that may be imposed by FERC,
ISO or the New York State Public Service Commission ("PSC"), the "Mitigation
Measures");
WHEREAS, sales of capacity, energy and certain other services from the
Purchased Assets will be subject to, and the rights and obligations of the
Parties under this Agreement may be affected by, the Mitigation Measures; and
WHEREAS, in recognition of Con Edison's installed capacity requirements
for its delivery service customers and its remaining native load customers, ABC
and Con Edison are entering into this Agreement, whereby ABC will maintain the
electric generating capability and availability of the Purchased Assets at
specified levels for the term of this Agreement and whereby, during certain
periods, Con Edison will purchase from ABC, and ABC will sell to Con Edison,
specified amounts of Installed Capacity (as defined herein).
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NOW THEREFORE, in consideration of the mutual agreements and commitments
contained herein, ABC and Con Edison hereby agree as follows:
1. DEFINITIONS.
(a) The following terms shall have the meanings set forth below. Any
term used in this Agreement that is not defined herein shall have the meaning
customarily attributed to such term by the electric utility industry in New
York.
"Ancillary Agreements" shall have the meaning ascribed thereto in the APA.
"Business Day" shall mean any day other than Saturday, Sunday or any day which
is a legal holiday or a day on which banking institutions in the State of New
York are authorized or required by law or other governmental action to close.
"Closing" shall mean the closing of the sale of the Purchased Assets and certain
other assets as contemplated by the APA.
"Closing Date" shall mean the date and time at which the Closing actually
occurs.
"Excess Deficiency Charges" shall mean the excess of the installed capacity
deficiency charges imposed by the NYPP or ISO, as the case may be, on Con Edison
over the payments that would have been due in accordance with Section 4.2 for
the amount of capacity in respect of which such deficiency charges were imposed.
"Government Authority" shall mean any court, administrative or regulatory agency
or commission or other government entity or instrumentality or any department
thereof.
"Installed Capacity" shall mean electric generating capacity of the Purchased
Assets that satisfies all of the requirements applicable to installed capacity
established by the NYPP or ISO, as the case may be, as such requirements apply
to Con Edison.
"ISO" shall mean the New York Independent System Operator, as described in the
Supplemental Filing, or its successors.
"ISO Rules" shall mean the rules and procedures adopted by the ISO pursuant to
the ISO Tariff from time to time in effect and the related ISO agreements.
"ISO Tariff" shall mean the tariff described in the Supplemental Filing, as it
may be amended from time to time.
"NERC" shall mean the North American Electric Reliability Council or its
successors.
"NYPP" shall mean the New York Power Pool or its successors.
"NPCC" shall mean the Northwest Power Coordinating Council or its successors.
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"NYPP Rules" shall mean the rules and procedures of the NYPP from time to time
in effect.
"NYSRC" shall mean the New York State Reliability Council or its successor.
"Offering Memorandum" shall have the meaning ascribed thereto in the APA.
"Replacement Capacity" shall mean installed capacity from resources other than
the Purchased Assets which resources are identified to the NYPP or ISO, as the
case may be, as sources of installed capacity in Con Edison's periodic reports
required under applicable procedures, provided that such installed capacity (i)
is from resources that are located in New York City or directly interconnected
to Con Edison's electric system in New York City, and (ii) would satisfy the
installed capacity requirements applicable to Con Edison, including any
applicable delivery requirements, established by the NYPP or ISO, as the case
may be.
"Replacement Capacity Costs" shall mean the excess of Con Edison's costs and
expenses for Replacement Capacity over the payments that would have been due in
accordance with Section 4.2 for an amount of capacity provided by ABC equal to
such Replacement Capacity.
"Supplemental Filing" shall mean the December 19, 1997 Supplemental Filing to
the Comprehensive Proposal to Restructure the New York Wholesale Electric Market
in FERC Docket Nos. ER97-1523-000, OA97-47000, and ER97-4234-000.
"Summer Capability Period" shall have the meaning provided by the NYPP or ISO,
as the case may be, as may be modified from time to time. Summer Capability
Period is currently May I through October 31 of each year.
"Winter Capability Period" shall have the meaning provided by the NYPP or ISO,
as the case may be, as may be modified from time to time. Winter Capability
Period is currently each November 1 through April 30 of the following calendar
year.
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(b) Each of the following terms has the meaning specified in the
Section set forth opposite such term:
Term Section
- ---- -------
ABC Preamble
Affiliate 8(a)
Agreement Preamble
APA Recitals
Capacity Payment 4.2
Capacity Deficiency Payments 4.3
Con Edison Preamble
Confidentiality Agreement 14
DMNC 3(a)
FERC Recitals
Force Majeure Event 7(a)
ICAP 4.2
Mitigation Measures Recitals
Party Preamble
PSC Recitals
Proposal Recitals
Purchased Assets Recitals
Required Net Capability 3(a)
2. EFFECTIVENESS, TERM AND TERMINATION.
2.1 This Agreement shall only become effective upon the consummation
of the Closing.
2.2 This Agreement shall expire on the later of (a) the earlier of
(i) December 31, 2002 or (ii) the date on which Buyer receives written notice
from the ISO to the effect that none of the electric capacity of the Purchased
Assets is required for meeting the installed capacity requirements in New York
City as determined by the ISO, or (b) the end of the capability period
immediately preceding the capability period covered by the first auction for
capacity sponsored by the ISO that occurs after the Closing Date.
2.3 Buyer and Seller agree that, notwithstanding any other provision
of this Agreement, the APA or any other Ancillary Agreement, this Agreement may
not be terminated prior to its expiration by either Party under any
circumstances, including as a result of a breach, whether or not material, by
the other Party, except pursuant to an agreement in writing executed by each
Party.
2.4 If any Governmental Authority having jurisdiction over this
Agreement requires any modification to, or imposes any condition on acceptance
or approval of, this Agreement, then the Parties shall engage in good faith
negotiations in
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order to amend this Agreement to satisfy, or otherwise address, such
modification or condition.
3. CAPABILITY AND AVAILABILITY REQUIREMENTS.
(a) During the term of this Agreement, ABC will use commercially
reasonable efforts to maintain the electric generating capability and
availability of the Purchased Assets (i) to provide an amount of Installed
Capacity, after any adjustment set forth in the ISO Rules to reflect the failure
by the Purchased Assets to satisfy the minimum generator availability targets
established by the ISO Rules applicable to the Purchased Assets, which shall be
no less than 100 percent of the Installed Capacity for the first Summer
Capability Period immediately following the Closing Date as reported by ABC to
the NYPP or ISO, as the case may be, based upon a Dependable Maximum Net
Capability ("DMNC") test of the Purchased Assets performed by ABC in accordance
with applicable procedures of the NYPP or ISO, as the case may be, but in no
event greater than the applicable summer net capacity amount set forth on pages
93 and 94 of the Offering Memorandum (the "Required Net Capability") and (ii) to
satisfy all criteria, standards and requirements applicable to providers of
installed capacity (including locational, seasonal and other performance
requirements and compliance with all applicable tariffs, rules and practices)
established by the NYSRC, NPCC, NERC and by the NYPP or the ISO, as applicable.
(b) For each capability period in which ABC fails to maintain the
capability and availability of the Purchased Assets to provide an amount of
Installed Capacity of no less than the Required Net Capability as required under
Section 3(a)(i), as such amount of Installed Capacity is demonstrated by a DMNC
test and adjusted, if necessary, in accordance with the ISO Rules to reflect the
failure by the Purchased Assets to satisfy the applicable minimum generator
availability targets, ABC shall pay to Con Edison a deficiency charge equal to
the product of (i) the amount (in MW) by which the Installed Capacity provided
is deficient, less any Replacement Capacity purchased by ABC for the applicable
capability period, to the extent such Replacement Capacity is not otherwise
required to meet the installed capacity requirements for New York City under
applicable ISO Rules in such capability period, and (ii) the deficiency charge
per MW applicable under the NYPP Rules or ISO Rules, as the case may be, for
failure by providers of installed capacity to satisfy applicable installed
capacity requirements. Payment of such deficiency charges shall be due at the
end of the first month following the end of the capability period for which the
deficiency charged is assessed.
(c) Following each capability period, and at such other times as may
reasonably be requested by Con Edison, ABC shall provide Con Edison access to,
or copies of, such relevant plant data and other documents and records
reasonably requested by Con Edison as is necessary to verify the electric
generating capability and availability of the Purchased Assets, and any
deficiency in the amount of Installed Capacity provided, for such capability
period or for another period as may be reasonably requested by Con Edison.
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(d) Without affecting ABC's obligations under Section 4 below, the
obligations under Section 3 shall not apply to any portion of the electric
generating capacity of the Purchased Assets with respect to which ABC receives a
written notice from the ISO that such capacity is no longer required for meeting
the installed capacity requirements in New York City as determined by the ISO.
4. INSTALLED CAPACITY PURCHASE, QUANTITY AND PAYMENTS.
4.1 Capacity Purchase Quantity
(a) From the Closing Date until the later of (i) the end of
the 1999 Summer Capability Period or (ii) the end of the capability period
immediately preceding the capability period covered by the first auction for
capacity for or including New York City sponsored by the ISO that occurs after
the Closing Date, ABC will sell to Con Edison and Con Edison will purchase from
ABC an amount of Installed Capacity equal to 100 percent of the Installed
Capacity as demonstrated by the Purchased Assets based upon the applicable
summer period DMNC testing, performed in accordance with applicable procedures
of the NYPP or ISO, as the case may be, adjusted, if necessary, in accordance
with the ISO Rules to reflect the failure by the Purchased Assets to satisfy the
applicable minimum generator availability targets established by the ISO Rules;
provided, however, that the amount of Installed Capacity to be provided under
this Section 4.1(a) shall be no less than the Required Net Capability. ABC shall
notify Con Edison five days prior to the conduct of any DMNC test, and Con
Edison shall have the right to observe such test.
(b) If the 1999-2000 Winter Capability Period is covered by an
auction for capacity for or including New York City sponsored by the ISO, ABC
will sell to Con Edison and Con Edison will purchase from ABC 454 MW of
Installed Capacity during the 1999-2000 Winter Capability Period.
(c) Subject to ABC's obligations under Section 3(a), and to
the extent permitted by NYPP Rules or ISO Rules, as the case may be, ABC may use
Replacement Capacity to supply the Installed Capacity required to be provided to
Con Edison under this Section 4.1.
4.2 Capacity Payments
The monthly payment from Con Edison to ABC for Installed Capacity
("Capacity Payment") shall equal the product of (a) the ICAP, (b) a daily per-MW
rate which, on an annualized basis, is equivalent to $105/kW-Year and (c) the
number of days in the applicable month (or portion thereof, if applicable).
"ICAP" is the amount of Installed Capacity, in MW, plus Replacement Capacity,
that is actually provided by ABC to Con Edison based upon the applicable summer
period DMNC testing performed in accordance with applicable procedures of the
NYPP or ISO, as the case may be, adjusted, if necessary, in accordance with the
ISO Rules to reflect the failure by the Purchased Assets to satisfy the
applicable minimum generator availability targets established by the ISO Rules.
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4.3 Capacity Deficiency Payments
(a) Whenever ICAP provided by ABC to Con Edison is less than
the amount of Installed Capacity that ABC is required to sell to Con Edison
under Section 4.1, ABC shall pay to Con Edison deficiency payments ("Capacity
Deficiency Payments"), which shall equal:
The sum of (i) all Excess Deficiency Charges; (ii) Con Edison's
Replacement Capacity Costs that are reasonably incurred if, and to
the extent that, ABC fails to provide Replacement Capacity and Con
Edison obtains such Replacement Capacity; (iii) all other directly
related costs and expenses, to the extent not included in (i) and
(ii), that are reasonably incurred by Con Edison; in all cases
incurred as a direct result of ABC's failure to provide Con Edison
with the required amount of Installed Capacity; provided, however,
that any Capacity Deficiency Payments will be credited against
deficiency charges due to Con Edison under Section 3(b).
(b) If Con Edison incurs any reasonable costs and expenses
described in Section 4.3(a) over a period greater than one calendar month, Con
Edison shall, subject to ABC's approval, which shall not be unreasonably
withheld, allocate those costs on a monthly basis.
4.4 Con Edison shall pay all taxes, surcharges, adjustments or other
assessments imposed by law, rule or regulation which are of general
applicability and imposed on the sales of Installed Capacity hereunder to the
extent that Con Edison can, based on a ruling from the PSC, collect such taxes,
surcharges, adjustments or other assessments from its customers.
4.5 Billing and payments of the Capacity Payment due under Section
4.2 and the Capacity Deficiency Payments due under Section 4.3 shall be made in
accordance with Section 6.
4.6 Subject to the terms and conditions set forth herein, ABC shall
satisfy all requirements applicable to suppliers of installed capacity
established by the NYPP or ISO, as the case may be, including any applicable
locational and seasonal requirements and compliance with and satisfaction of all
applicable tariffs, rules and practices, so that Con Edison will receive the
amount of Installed Capacity specified in Section 4.1.
4.7 Subject to the terms and conditions set forth herein, Con Edison
shall satisfy all requirements applicable to purchasers of installed capacity
established by the NYPP or ISO, as the case may be. Notwithstanding the
provisions of Section 4.3, Con Edison shall have no obligation to obtain
Replacement Capacity if ABC fails to supply all or part of the Installed
Capacity required under Section 4.1 or to obtain Replacement Capacity for any
shortfall in such Installed Capacity.
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4.8 In the event the Closing occurs after July 31, 1999 and the
1999-2000 Winter Capability Period is covered by an auction for capacity for or
including New York City sponsored by the ISO, ABC will sell to Con Edison and
Con Edison will purchase from ABC an additional 182 MW of Installed Capacity
during the 1999-2000 Winter Capability Period, on a pro rata basis, for each
month or portion thereof after July 31, 1999, until the Closing Date, which
obligation shall be in addition to the obligations to sell and purchase
Installed Capacity pursuant to Section 4.1(b) and shall be otherwise subject to
the same terms and conditions as such obligations; provided, however, that the
additional obligation pursuant to this Section 4.8 to purchase Installed
Capacity shall (a) in no event exceed 546 MW and (b) not be applicable if such
delay in Closing is caused solely by Buyer.
5. SCHEDULING.
Consistent with the procedures of the NYPP or ISO, as the case may
be, and consistent with ABC's obligations under Section 4.1 and 4.6, ABC shall
specify to Con Edison in writing, for each Summer Capability Period and for each
Winter Capability Period, the generating units of the Purchased Assets and
Replacement Capacity that ABC will use to supply Installed Capacity to Con
Edison for such Summer Capability Period or Winter Capability Period, as the
case may be, and the amount of Installed Capacity to be supplied from each
generating unit, or any change thereto, at least 30 days before the date Con
Edison is required to report such information, or any changes thereto, to the
NYPP or ISO, as the case may be.
6. BILLING AND PAYMENT PROCEDURES.
6.1 Billing and Payments
(a) In respect of each calendar month ending after the Closing
Date, ABC shall, on or prior to the twentieth day of the following month,
prepare and render an invoice to Con Edison for the Capacity Payment due from
Con Edison to ABC for the preceding calendar month, calculated in accordance
with Section 4.2. The Capacity Payment owed shall be due and payable on or
before the later of (i) the last day of such following month, or (ii) 10
Business Days after Con Edison receives an invoice. All payments shall be made
in immediately available funds by wire transfer to an account designated by ABC.
(b) In respect of each calendar month ending after the Closing
Date, Con Edison shall, on or prior to the twentieth day of the following month,
prepare and render an invoice to ABC for any Capacity Deficiency Payments due
from ABC to Con Edison for the preceding calendar month, calculated in
accordance with Section 4.3. The Deficiency Capacity Payments owed shall be due
and payable on or before the later of (i) the last day of such following month,
or (ii) 10 Business Days after ABC receives an invoice.
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(c) Each Party may set off any undisputed amount owed to the
other Party against any undisputed amount owed to such Party by the other Party
pursuant to this Agreement or other arrangement(s) specifically agreed to
between the parties, including, without limitation, amounts owed by ABC to Con
Edison under Section 3(b).
(d) If any payment under Sections 3(b), 6.1(a) or 6.1(b) falls
due on a day that is not a Business Day, then the payment shall be made on the
next Business Day.
(e) Interest on unpaid amounts or payments received after the
due date shall accrue at a rate equal to the prime commercial lending rate
established from time to time by Chase Manhattan Bank, N.A., New York, New York,
or its successor, from the due date until the date upon which payment is made.
(f) Any payments owed directly by ABC to the NYPP or ISO, as
the case may be, shall be made pursuant to the procedures established by the
NYPP or ISO, as the case may be. ABC shall be solely responsible for making all
such payments to the NYPP or ISO.
(g) The Parties shall maintain records, accounts and other
documents sufficient to reflect accurately all transactions hereunder for a
period of four years from the time of the transactions. Each Party shall, at its
own expense, have the right to audit such records, accounts and other documents
of the other Party during such four-year period upon reasonable prior notice to
the other Party.
6.2 Billing Disputes
If a Party contests the amount billed in accordance with Sections
6.1(a) or (b) before such amount is due, the contesting Party shall pay the
undisputed billed amount when due and promptly provide written notice to the
other Party of the disputed amount and identifying the reason for the dispute.
If neither Party disputes a bill within six months after the due date of such
bill, such bill shall be deemed correct. The Parties shall engage in good faith
negotiations to resolve any disputed amounts within 30 days. If the Parties are
unable to resolve a dispute within such period, disputed amounts shall, if
requested by the billing Party, be paid into an escrow account within 30 days of
such request pending resolution of the dispute. Thereafter, either Party may
exercise such remedies as may be available under this Agreement, at law or in
equity. In addition to any other remedies available to ABC, in the event Con
Edison fails to pay a disputed bill into such escrow account within 30 days of a
request by ABC pursuant to the previous sentence, ABC may withhold Installed
Capacity to be provided to Con Edison under Section 4.1 until such bill is paid
into such escrow account. Interest at the rate specified in Section 5.1(e) shall
accrue on any amount due hereunder, if any, that is refunded or credited to the
contesting Party or that is released from escrow to the non-contesting Party,
when the contested amount is resolved.
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6.3 Survival
The provisions of Section 3, Section 4 and this Section 6 shall
survive termination, expiration, cancellation, suspension, or completion of this
Agreement to the extent necessary to allow for final billing and payment.
7. FORCE MAJEURE.
(a) Notwithstanding anything in this Agreement to the contrary,
neither Party shall have any liability or be otherwise responsible to the other
for its failure to carry out its obligations, with the exception of any
obligation to pay money, under this Agreement if and only to the extent that it
becomes impossible for either Party to so perform as a result of any occurrence
or event which is beyond the reasonable control, and does not result from any
fault or negligence, of the Party affected (each, a "Force Majeure Event"),
including any act of God, strike or any other labor disturbance, act of a public
enemy, war, act of terrorism, riot, any other civil disturbance, fire, storm,
lightning, flood, earthquake, any other natural disasters, explosion, materials
shortage, breakage or accident involving facilities, equipment or systems, any
order or regulation or restriction imposed by any Governmental Authority,
failure of a contractor or subcontractor caused by a Force Majeure Event and
transportation delays or stoppages.
(b) If a Party shall rely on the occurrence of a Force Majeure Event
as a basis for being excused from performance of its obligations under this
Agreement, then the Party relying on such occurrence shall (i) provide prompt
written notice of such Force Majeure Event to the other Party giving an estimate
of its expected duration and the probable impact on the performance of its
obligations hereunder; (ii) exercise its reasonable best efforts to continue to
perform its obligations under this Agreement; (iii) reasonably and expeditiously
take action to correct or cure the Force Majeure Event, provided, however that
settlement of strikes or any other labor disturbance will be completely within
the sole discretion of the Party affected by such strike or labor dispute; (iv)
exercise its reasonable best efforts to mitigate or limit damages to the other
Party; and (v) provide prompt written notice to the other Party of the cessation
of the Force Majeure Event.
8. ASSIGNMENT; NO THIRD PARTY BENEFICIARIES.
(a) This Agreement and all of the provisions hereof shall be binding
upon and inure to the benefit of the Parties and their respective successors and
permitted assigns, but neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by either Party, including by
operation of law, without the prior written consent of the other Party, except
(i) in the case of Con Edison, to an Affiliate of Con Edison or a third party
that has a contractual or statutory obligation to supply Installed Capacity to
Con Edison's retail customers; (ii) in the case of ABC, to an Affiliate of ABC
or a third party in connection with the transfer of all of ABC's right, title
and interest in and to the Purchased Assets to such Affiliate or third party;
and (iii) in the case of either Party, to a lending institution or trustee in
connection with a
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pledge or granting of a security interest in the Purchased Assets and/or this
Agreement; provided, however, that no assignment or transfer of rights or
obligations by either Party shall relieve it from the full liabilities and the
full financial responsibility, as provided for under this Agreement, unless and
until the transferee or assignee shall agree in writing to assume such
obligations and duties and the other Party has consented in writing to such
assumption. For purposes of this Agreement, the term "Affiliate" shall have the
meaning set forth in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended.
(b) Nothing in this Agreement is intended to confer upon any other
person except the Parties any rights or remedies hereunder or shall create any
third party beneficiary rights in any person.
9. EXTENSION; WAIVER.
Either Party may (a) extend the time for the performance of any of
the obligations or other acts of the other Party or (b) waive compliance by the
other Party with any of the agreements or conditions contained in this
Agreement. Any agreement on the part of a Party to any such extension or waiver
shall be valid only if set forth in an instrument in writing signed on behalf of
such Party. The failure of a Party to this Agreement to assert any of its rights
under this Agreement or otherwise shall not constitute a waiver of such rights.
Notwithstanding anything herein to the contrary, to the extent that either Party
fails, in any particular instance, to take affirmative steps to exercise its
rights to witness, inspect, observe or approve the activities of the other
Party, such rights shall, solely with respect to such instance, be deemed waived
in respect of such activity.
10. COUNTERPARTS.
This Agreement may be executed in two or more counterparts, each of
which will be deemed an original, but all of which together shall constitute one
and the same instrument.
11. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York (regardless of the laws that might otherwise
govern under applicable principles of conflicts of law).
12. SEVERABILITY.
If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect. Upon
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such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the Parties shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the Parties as closely as
possible to the fullest extent permitted by applicable law in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to the
extent possible.
13. AMENDMENT.
This Agreement may be amended, modified or supplemented only by an
instrument in writing signed on behalf of each of the Parties. This Agreement
shall not be subject to change by application or complaint by any of the Parties
to the FERC or any successor agency pursuant to Section 206 of the Federal Power
Act or any successor provision, or by application or complaint to any court or
state regulatory agency. If the applicable provisions of the NYPP Rules, or the
applicable provisions of the ISO Tariff or ISO Rules, relating to installed
capacity requirements applicable to this Agreement or the implementation of this
Agreement are changed materially, the Parties shall endeavor in good faith to
make conforming changes to this Agreement with the intent to fulfill the
purposes of this Agreement; provided, however, that in no event shall such
changes modify the price for Installed Capacity set forth in Section 4.2 or
excuse ABC from paying, or otherwise modifying its obligations in respect of,
Capacity Deficiency Payments under Section 4.3. Any such conforming change to
this Agreement shall be subject to all necessary regulatory authorizations,
which the Parties shall request or support, as applicable.
14. ENTIRE AGREEMENT.
This Agreement, the APA, the other Ancillary Agreements and the
Confidentiality Agreement dated *, 1998, between Con Edison and ABC (the
"Confidentiality Agreement"), including the Exhibits, Schedules, documents,
certificates and instruments referred to herein or therein and other contracts,
agreements and instruments contemplated hereby or thereby embody the entire
agreement and understanding of the Parties in respect of the transactions
contemplated by this Agreement. There are no restrictions, promises,
representations, warranties, covenants or undertakings other than those
expressly set forth or referred to herein or therein. This Agreement, the APA
and the other Ancillary Agreements supersede all prior agreements and
understandings between the Parties with respect to the transaction contemplated
by this Agreement other than the Confidentiality Agreement.
15. FURTHER ASSURANCES.
The Parties agree to, from time to time upon the reasonable request
of either Party, negotiate in good faith and execute and deliver amendments to
this Agreement, including in response to regulatory, technological, operational
or other changes affecting the Purchased Assets or the electric power industry
generally, or such
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other documents or instruments as may be necessary, in order to effectuate the
transactions contemplated hereby.
16. INDEPENDENT CONTRACTOR STATUS.
Nothing in this Agreement is intended to create an association,
trust, partnership or joint venture between the Parties, or to impose a trust,
partnership, or fiduciary duty, obligation or liability on or with respect to
either Party, and nothing in this Agreement shall be construed as creating any
relationship between Con Edison and ABC other than that of independent
contractors.
17. NOTICES.
Unless otherwise specified herein, all notices and other
communications hereunder shall be in writing and shall be deemed given (as of
the time of delivery or, in the case of a telecopied communication, of
confirmation) if delivered personally, telecopied (which is confirmed) or sent
by overnight courier (providing proof of delivery) to the Parties at the
following addresses (or at such other address for a Party as shall be specified
by like notice)
if to Con Edison, to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Telecopy No.: (212) 677-0601
Attention: Senior Vice President & General Counsel
if to ABC, to:
Telecopy No.:
Attention:
18. INTERPRETATION.
When a reference is made in this Agreement to an Article or Section,
such reference shall be to an Article or Section of this Agreement unless
otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation" or
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equivalent words. The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. All terms defined
in this Agreement shall have the defined meanings when used in any certificate
or other document made or delivered pursuant hereto unless otherwise defined
therein. The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms. Any agreement, instrument,
statute, regulation, rule or order defined or referred to herein or in any
agreement or instrument that is referred to herein means such agreement,
instrument, statute, regulations, rule or order as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes, regulations, rules or orders)
by succession of comparable successor statutes, regulations, rules or orders and
references to all attachments thereto and instruments incorporated therein.
References to a person are also to its permitted successors and assigns.
19. JURISDICTION AND ENFORCEMENT.
(a) Each of the Parties irrevocably submits to the exclusive
jurisdiction of (i) the Supreme Court of the State of New York, New York County
and (ii) the United States District Court for the Southern District of New York,
for the purposes of any suit, action or other proceeding arising out of this
Agreement or any transaction contemplated hereby. Each of the Parties agrees to
commence any action, suit or proceeding relating hereto either in the United
States District Court for the Southern District of New York or, if such suit,
action or proceeding may not be brought in such court for jurisdictional
reasons, in the Supreme Court of the State of New York, New York County. Each of
the Parties further agrees that service of process, summons, notice or document
by hand delivery or U.S. registered mail at the address specified for such Party
in Section 17 (or such other address specified by such Party from time to time
pursuant to Section 17 shall be effective service of process for any action,
suit or proceeding brought against such Party in any such court. Each of the
Parties irrevocably and unconditionally waives any objection to the laying of
venue of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in (i) the Supreme Court of the State of New
York, New York County, or (ii) the United States District Court for the Southern
District of New York, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such action, suit or
proceeding brought in any such court has been brought in an inconvenient forum.
(b) The Parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the Parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, this being in addition to any other
remedy to which they are entitled at law or in equity.
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20. CONFLICT.
Except as expressly otherwise provided herein or therein, in the
event of any conflict or inconsistency between the terms of this Agreement and
the terms of the APA or any other Ancillary Agreement, the terms of this
Agreement shall prevail.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to
be signed by their respective duly authorized officers as of the date and year
first above written.
ABC
By: _________________________________
Title: _________________________________
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
By: _________________________________
Title: _________________________________
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EXHIBIT H
A-0 NON-EXCLUSIVE DOCK LICENSE (THE "LICENSE")
SUMMARY OF TERMS AND CONDITIONS
Licensor: Buyer.
Licensee: Seller.
Licensed Premises: A-0 Dock and related wastewater unloading equipment
located adjacent to the Astoria Generating Plants.
License Term: Twenty (20) years.
Renewal Term: Licensee may renew for four (4) 20-year periods, in each
case by providing at least one hundred eighty (180)
days' prior written notice to Licensor.
Use: Licensee has a non-exclusive right to use the Licensed
Premises in connection with the docking of a wastewater
barge and for unloading wastewater from such barge to a
wastewater treatment facility owned by Seller and
located on Seller's property.
Improvements
And Alternations: Licensee will not make any improvements or alternations
to the Licensed Premises without the prior written
consent of Licensor.
Non-Exclusivity: Licensed Premises may also be used by Licensor and other
owners or tenants at the Astoria site.
Option to Terminate: Licensee has right to terminate in its sole discretion
on one hundred twenty (120) days' prior written notice.
Revocation: Licensor has the right to revoke the License for cause,
which cause for revocation continues uncured through the
expiration of any applicable grace period.
License Fee: The License is granted free of charge.
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Economic Obligations
of Licensee: The Licensee will pay the property taxes and be
responsible for all maintenance expenses on the Licensed
Premises.
Environmental
Liabilities: Except as specified in the following sentence, as
between Licensor and Licensee, Licensee shall be
responsible and liable for, and indemnify and hold
Licensor harmless from, all Environmental Liabilities
under any Environmental Law relating to the Licensed
Premises and arising out of or in connection with the
Licensee's use of, or operations at, the Licensed
Premises during the License Term. Except (i) for the
offsite transportation, disposal or arrangement for
disposal of Hazardous Substances by Licensee prior to
Closing, (ii) liabilities relating to the Licensed
Premises retained by Seller under the Seller Consent
Orders, and (iii) any monetary fines to the extent
arising out of events prior to Closing, as between
Licensor and Licensee, Licensor shall be responsible and
liable for, and indemnify and hold harmless Licensee
from, all Environmental Liabilities under any
Environmental Law relating to the Licensed Premises and
arising out of or in connection with the Licensor's use
of, or operations at, the Licensed Premises or with
events or conditions which (i) existed prior to the
commencement of the License Term or (ii) arise after the
expiration of the License Term (and any Renewal Term).
Maintenance: The Licensee agrees to maintain the Licensed Premises in
the condition existing at the commencement of the
initial License Term. The Licensee will maintain and
repair the Licensed Premises in accordance with Good
Industry Practice but will not be responsible for
repairs required by damage to the Licensed Premises
caused by others.
Insurance: Unless waived by Licensor (in which case Licensor shall
obtain such insurance itself), Licensee shall maintain
and keep in full force and effect the following
insurance, subject to commercially reasonable terms,
with respect to the Licensed Premises:
o general comprehensive liability insurance
including contractual liability with limits of at
least $5 million per occurrence for bodily injury
and at least $1 million per occurrence for
property damage or a combined single limit of
$5,000,000 per occurrence;
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225
o statutory workers' compensation insurance as
required by law, and employer's liability
insurance, including in respect of accidents (with
a limit of at least $500,000 per accident) and
occupation diseases (with a limit of at least
$500,000 per employee); and
o property casualty insurance (with subrogation
waived against Licensor) in such amounts as are
agreed between Licensor and Licensee.
Such insurance shall have such deductibles and
retentions and be underwritten by such companies (to be
approved by Licensor) as would be obtained by a
reasonably prudent electric power business and shall be
primary and noncontributory with any insurance carried
by Licensor and shall not require that Licensor pay any
premium thereunder. Licensor will be named as an
additional insured under the general comprehensive
liability insurance policy and as a loss payee on the
property casualty insurance policy. Licensee may
self-insure against any of the liabilities set forth
above if Licensee satisfies all applicable statuary and
regulatory criteria with respect to the self-insurance
of the relevant liability.
Indemnification: The indemnification rights and obligations under the
License will be governed by the indemnification
provisions of Asset Purchase and Sale Agreement.
Assignment and
Sublicensing: Licensee may not assign or sublicense its rights or
obligations under the License without the prior written
consent of Licensor.
End of License
Obligations: At the expiration or revocation of the License, Licensee
will vacate the Licensed Premises and leave the Licensed
Premises in the condition existing at the commencement
of the License Term.
Permits: Licensee will hold all permits necessary to conduct its
operations at or in connection with the Licensed
Premises and will be responsible for compliance with
same.
Governing Law: New York.
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TERMS USED BUT NOT DEFINED HEREIN SHALL HAVE THE MEANINGS ASSIGNED THERETO IN
THE GENERATING PLANT AND GAS TURBINE ASSET PURCHASE AND SALE AGREEMENT TO
WHICH THIS EXHIBIT H IS ATTACHED.
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227
EXHIBIT I
ASTORIA
DECLARATION OF SUBDIVISION EASEMENTS
By
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
Dated as of , 1999
The land affected by the within instrument lies in Block 850, Lot I on
the Tax Map of the City of
New York, Queens County.
Address:
Record and return to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attention: Robert Selya, Esq.
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Definitions ................................................. 2
ARTICLE II
Declaration of Easements
SECTION 2.01. Grant of Easements for the Benefit of Parcel A .............. 3
SECTION 2.02. Grant of Easements for the Benefit of Parcel B .............. 4
SECTION 2.03. Grant of Easements for the Benefit of Parcel C .............. 5
SECTION 2.04. Grant of Easements for the Benefit of Parcel D .............. 5
SECTION 2.05. Utility Cost Sharing ........................................ 6
SECTION 2.06. Condition of Easements ...................................... 7
SECTION 2.07. Fire Alarm System ........................................... 7
SECTION 2.08. Emergency Response .......................................... 7
ARTICLE III
Term of Easements; Abandonment
SECTION 3.01. Term ........................................................ 7
SECTION 3.02. Abandonment of Easements .................................... 7
ARTICLE IV
Use. Repair and Maintenance of Easements
SECTION 4.01. Maintenance Obligation ...................................... 8
SECTION 4.02. Failure to Maintain ......................................... 8
SECTION 4.03. Use of Easement Area During Maintenance ..................... 8
SECTION 4.04. General Use Conditions ...................................... 9
SECTION 4.05. Compliance with Law ......................................... 9
SECTION 4.06. Notification of Proposed Activity ........................... 9
SECTION 4.07. Performance of Work ......................................... 9
SECTION 4.08. Notice of Entry ............................................. 10
SECTION 4.09. Relocation of Easements ..................................... 10
ARTICLE V
Casualty; Condemnation
SECTION 5.01. Restoration Work ............................................ 10
SECTION 5.02. Condemnation ................................................ 11
SECTION 5.03. Relocation of an Easement After Casualy or Condemnation ..... 11
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ARTICLE VI
Miscellaneous Provisions
SECTION 6.01. Force Majeure ............................................... 11
SECTION 6.02. Default and Remedies ........................................ 11
SECTION 6.03. Mortgagees' Status .......................................... 12
SECTION 6.04. Estoppel Certificate ........................................ 12
SECTION 6.05. No Dedication ............................................... 12
SECTION 6.06. Covenants Running With Land ................................. 12
SECTION 6.07. No Merger ................................................... 13
SECTION 6.08. Assignment; No Third Party Beneficiaries .................... 13
SECTION 6.09. Notices ..................................................... 13
SECTION 6.10. Extension; Waiver ........................................... 14
SECTION 6.11. Amendment and Modification .................................. 14
SECTION 6.12. Governing Law ............................................... 14
SECTION 6.13. Interpretation .............................................. 14
SECTION 6.14. Jurisdiction and Enforcement ................................ 15
SECTION 6.15. Severability ................................................ 15
SECTION 6.16. Property Treated as Single Zoning Lot ....................... 15
List of Exhibits and Schedules
Exhibit A Legal Description of Parcel A
Exhibit B Legal Description of Parcel B
Exhibit C Legal Description of Parcel C
Exhibit D Legal Description of Parcel D
Exhibit E Site Plan
Schedule 4.01 Ownership Rights and Maintenance Obligations of Parcel Owners
ii
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DECLARATION
ASTORIA DECLARATION OF SUBDIVISION EASEMENTS (including the Exhibits and
Schedules, this "Declaration") dated as of , 1999 by CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC., a New York corporation ("Declarant").
WHEREAS Declarant is the owner of the parcel of land described on Exhibit
A attached hereto and made a part hereof located in Queens County, New York
("Parcel A") and the improvements located thereon, as shown on the site plan
prepared by GEOD Corporation dated February 17, 1999 attached hereto and made a
part hereof as Exhibit E (the "Site Plan");
WHEREAS Declarant is the owner of the parcel of land described on Exhibit
B attached hereto and made a part hereof located in Queens County, New York
("Parcel B") and the improvements located thereon, as shown on the Site Plan;
WHEREAS Declarant is the owner of the parcel of land described on Exhibit
C attached hereto and made a part hereof located in Queens County, New York
("Parcel "C") and the improvements located thereon, as shown on the Site Plan;
WHEREAS Declarant is the owner of the parcel of land described on Exhibit
D attached hereto and made a part hereof located in Queens County, New York
("Parcel "D") and the improvements located thereon, as shown on the Site Plan;
WHEREAS Parcel A, Parcel B, Parcel C and Parcel D are part of a single
zoning lot as that term is defined in Section 12-10 of the Zoning Resolution of
the City of New York, effective December 15, 1961, as amended from time to time
(collectively referred to as the "Property");
WHEREAS Declarant has operated the Property for the generation and
production of electrical energy as well as the transmission and distribution
thereof, and other uses related to the conduct of a public utility business;
WHEREAS Declarant has been ordered by the State of New York Public Service
Commission to divest certain generation plant assets;
WHEREAS in order to accomplish such divestiture, Parcels B, C and D will
be sold to third parties and Parcel A will be retained by Declarant;
WHEREAS in order to accomplish said proposed sale of Parcels B, C and D,
Declarant intends to subdivide the Property into four parcels, Parcel A, Parcel
B, Parcel C and Parcel D (each, a "Parcel" and, collectively, the "Parcels")
without affecting the single zoning lot status thereof; and
WHEREAS Declarant, in order to continue operations on the Parcels and to
satisfy the New York City Department of Buildings and the New York City
Department of Business Services, has created certain easements and made certain
declarations for the benefit of Parcels A, B, C and D as a condition of said
subdivision.
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NOW, THEREFORE, Declarant, intending the Parcels to be legally bound by
the easements, covenants, conditions and restrictions hereinafter set forth,
declares as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. As used in this Declaration, the following
terms shall have the following meanings:
"Casualty" shall have the meaning set forth in Section 5.01.
"Curing Party"" shall have the meaning set forth in Section 4.02.
"Declarant" shall have the meaning set forth in the Preamble.
"Defaulting Party" shall have the meaning set forth in Section 4.02.
"Easement" means, as applicable, any easement including related rights
intended for the primary benefit of Parcel A or Parcel B or Parcel C or Parcel D
under this Declaration.
"Easement Area" means an area, including roads and paths, on, above or
below the ground which burdens a Parcel with respect to which the owner of the
other Parcel is herein granted an Easement or Non-Exclusive Right.
"Entering Party" shall have the meaning set forth in Section 4.07. The
term "Entering Party" shall include a Party exercising Self-Help Rights as a
Curing Party.
"Entry Rights" means rights of any Party (including Self-Help Rights)
under this Declaration, to maintain an Easement Area; provided that such rights
shall be exercised in accordance with Section 4.07.
"Force Majeure Event" means any occurrence or event which is beyond the
reasonable control, and does not result from any fault or negligence, of the
Party affected, including any act of God, strike or other labor disturbance, act
of a public enemy, war, act of terrorism, riot, any other civil disturbance,
fire, storm, flood, lightning, earthquake, any other natural disasters,
explosion, materials shortage, breakage or accident to machinery or equipment,
any order or regulation or restriction imposed by any Governmental Authority,
failure of a contractor or subcontractor caused by a Force Majeure Event and
transportation delays or stoppages.
"Governmental Authority" means any court, administrative or regulatory
agency or commission or other governmental entity or instrumentality, domestic,
foreign or supranational or any department thereof.
"Mortgagee" means the holder, from time to time, of a mortgage on Parcel A
or Parcel B or Parcel C or Parcel D, which holder has-notified the owners of
the other Parcels of its interest as mortgagee and has provided such owners with
a notice address.
"Non-Exclusive Right" means any right or Easement intended for the common,
mutual, or reciprocal benefit of more than one Parcel under this Declaration.
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"Parcel" shall have the meaning set forth in the Recitals and shall
include a portion of a Parcel.
"Party or Parties" shall mean the owner or owners from time to time of all
or any portion of a Parcel.
"Permittee" means the Parties and those claiming by, through or under each
of them and their respective officers, directors, trustees, employees, agents,
contractors, subcontractors, customers, visitors, invitees and licensees.
"Reimbursement Rights" means the rights of the Curing Party which has
exercised its Self-Help Rights (as defined below), to collect from the
Defaulting Party the reasonable costs and expenses actually expended by the
Curing Party in exercising its Self-Help Rights, including reasonable attorneys'
fees.
"Release" means the relinquishment by any Party of an Easement or
Non-Exclusive Right.
"Releasor" means the Party relinquishing an Easement or Non-Exclusive
Right and "Releasee" means the owner of the Easement Area affected by a Release.
"Self-Help Rights" shall have the meaning set forth in Section 4.02.
"Taking" shall have the meaning set forth in Section 5.03.
"Taxes" shall mean all taxes, charges, fees, levies, penalties or other
assessments imposed by any state or local taxing authority, which, if unpaid,
could become a lien against a Parcel.
"Utility" or "Utilities" shall mean the essential services for which
Easements and Non-Exclusive Rights are granted under Article II.
"Zoning Resolution" shall mean the Zoning Resolution of the City of New
York, effective December 15, 1961, as amended from time to time.
ARTICLE II
Declaration of Easements
SECTION 2.01. Grant of Easements for the Benefit of Parcel A. Declarant,
as owner of Parcels B, C and D, hereby grants to Declarant, as appurtenant to
and for the benefit of Parcel A, the following rights and Easements intended to
allow the assets located on Parcel A to continue to operate, notwithstanding
subdivision of the Property:
(a) Easement for Domestic Water Supply. The Non-Exclusive Right and
Easement for domestic water supply to Parcel A through the existing water pipes,
mains and other devices or equipment related thereto located on Parcel B and/or
Parcel C or designated for such purposes on the Site Plan.
(b) Easement for Access. Intentionally Omitted.
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(c) Easement for Fire Protection Water and Related Purposes (Fire Service,
Alarm, Hydrant). The Non-Exclusive Right and Easement for domestic water supply
to Parcel A through the existing water pipes, mains and other devices or
equipment related thereto located on Parcel B and/or Parcel C or designated for
such purposes on the Site Plan.
(d) Easement for Sewer Lines and Drainage System. The Non-Exclusive Right
and Easement for the discharge of sewage and drainage of storm water through the
existing sanitary sewer and drainage system, including pipes, drains, manholes,
mains and other devices or equipment related thereto as are now located on,
above or under Parcel B and/or Parcel C or shown on the Site Plan and are
designed for the discharge of sewage or drainage of storm water.
(e) Reservation of Rights. Without in any way limiting the rights of the
fee owner(s) of Parcel B and Parcel C and Parcel D, there are hereby reserved to
the owner(s) of Parcel B and Parcel C and Parcel D all rights in and to the
Easement Areas located on Parcel B and Parcel C and Parcel D, respectively, to
the extent such rights are not inconsistent with and do not materially interfere
with the use of the Easement Areas by the owner of Parcel A and the exercise by
the owner of Parcel A of the Easements and Non-Exclusive Rights granted pursuant
to Section 2.01 hereof.
(f) Further Actions. The Easements and Non-Exclusive Rights granted in
this Section 2.01 shall include the right on the part of the owner of Parcel A
to take such other actions as may be reasonably necessary for the full exercise
of the Easements and Non-Exclusive Rights specified herein.
SECTION 2.02. Grant of Easements for the Benefit of Parcel B. Declarant,
as owner of Parcels A, C and D, hereby grants to Declarant, as appurtenant to
and for the benefit of Parcel B, the following rights and Easements intended to
allow the assets located on Parcel B to continue to operate, notwithstanding
subdivision of the Property:
(a) Easement for Domestic Water Supply. The Non-Exclusive Right and
Easement for domestic water supply to Parcel B through the existing water pipes,
mains and other devices or equipment related thereto located on Parcel A or
designated for such purposes on the Site Plan.
(b) Easement for Access. Intentionally Omitted.
(c) Easement for Fire Protection Water and Related Purposes (Fire Service,
Alarm, Hydrant). The Non-Exclusive Right and Easement for domestic water supply
to Parcel B through the existing water pipes, mains and other devices or
equipment related thereto located on Parcel A or designated for such purposes on
the Site Plan.
(d) Easement for Sewer Lines and Drainage System. Intentionally Omitted.
(e) Reservation of Rights. Without in any way limiting the rights of the
fee owner(s) of Parcel A and Parcel C and Parcel D, there are hereby reserved to
the owner(s) of Parcel A and Parcel C and Parcel D all rights in and to the
Easement Areas located on Parcel A and Parcel C and Parcel D, respectively, to
the extent such rights are not inconsistent with and do not materially interfere
with the use of the Easement Areas by the owner of Parcel B and the exercise by
the owner of Parcel B of the Easements and Non-Exclusive Rights granted pursuant
to Section 2.02 hereof.
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(f) Further Actions. The Easements and Non-Exclusive Rights granted in
this Section 2.02 shall include the right on the part of the owner of Parcel B
to take such other actions as may be reasonably necessary for the full exercise
of the Easements and Non-Exclusive Rights specified herein.
SECTION 2.03. Grant of Easements for the Benefit of Parcel C. Declarant,
as owner of Parcels A and B and D, hereby grants to Declarant, as appurtenant to
and for the benefit of Parcel C, the following rights and Easements intended to
allow the non-generating assets located on Parcel C to continue to operate,
notwithstanding subdivision of the Property:
(a) Easement for Domestic Water Supply. The Non-Exclusive Right and
Easement for domestic water supply to Parcel C through the existing water pipes,
mains and other devices or equipment related thereto located on Parcel A and/or
Parcel B or designated for such purposes on the Site Plan.
(b) Easement for Access. The Non-Exclusive Right and Easement to use, and
to permit its Permittees to use, in common with the owner(s) of Parcel A and
Parcel B and Parcel D and their Permittees, the area designated on the Site Plan
as the "Easement for Ingress and Egress," in accordance with the terms hereof,
for vehicular access, ingress and egress to and from Parcel C over said Easement
Area to 20th Avenue, including the passage of motor vehicles of every kind and
nature (including tractor-trailer trucks, fire trucks, delivery and service
trucks and other vehicles).
(c) Easement for Fire Protection Water and Related Purposes (Fire Service,
Alarm, Hydrant). The Non-Exclusive Right and Easement for domestic water supply
to Parcel C through the existing water pipes, mains and other devices or
equipment related thereto located on Parcel A and/or Parcel B or designated for
such purposes on the Site Plan.
(d) Easement for Sewer Lines and Drainage System. The Non-Exclusive Right
and Easement for the drainage of storm water through the existing drainage
system, including pipes, drains, manholes, pumps, mains and other devices or
equipment related thereto as are now located on, above or under Parcel A or
shown on the Site Plan and are designed for the drainage of storm water.
(e) Reservation of Rights. Without in any way limiting the rights of the
fee owner(s) of Parcel A and Parcel B and Parcel D, there are hereby reserved to
the owner(s) of Parcel A and Parcel B and Parcel D all rights in and to the
Easement Areas located on Parcel A and Parcel B and Parcel D, respectively, to
the extent such rights are not inconsistent with and do not materially interfere
with the use of the Easement Areas by the owner of Parcel C and the exercise by
the owner of Parcel C of the Easements and Non-Exclusive Rights granted pursuant
to Section 2.03 hereof.
(f) Further Actions. The Easements and Non-Exclusive Rights granted in
this Section 2.03 shall include the right on the part of the owner of Parcel C
to take such other actions as may be reasonably necessary for the full exercise
of the Easements and Non-Exclusive Rights specified herein.
SECTION 2.04. Grant of Easements for the Benefit of Parcel D. Declarant,
as owner of Parcels A and B and C, hereby grants to Declarant, as appurtenant to
and for the benefit
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of Parcel D, the following rights and Easements intended to allow the
non-generating assets located on Parcel D to continue to operate,
notwithstanding subdivision of the Property:
(a) Easement for Domestic Water Supply. The Non-Exclusive Right and
Easement for domestic water supply to Parcel D through the existing water pipes,
mains and other devices or equipment related thereto located on Parcel A and/or
Parcel B and/or Parcel C or designated for such purposes on the Site Plan.
(b) Easement for Access. The Non-Exclusive Right and Easement to use, and
to permit its Permittees to use, in common with the owner(s) of Parcel A and
Parcel B and Parcel C and their Permittees, the area designated on the Site Plan
as the "Easement for Ingress and Egress," in accordance with the terms hereof,
for vehicular access, ingress and egress to and from Parcel D over said Easement
Area to 20th Avenue, including the passage of motor vehicles of every kind and
nature (including tractor-trailer trucks, fire trucks, delivery and service
trucks and other vehicles).
(c) Easement for Fire Protection Water and Related Purposes (Fire Service,
Alarm, Hydrant). The Non-Exclusive Right and Easement for domestic water supply
to Parcel D through the existing water pipes, mains and other devices or
equipment related thereto located on Parcel A and/or Parcel B and/or Parcel C or
designated for such purposes on the Site Plan.
(d) Easement for Sewer Lines and Drainage System. The Non-Exclusive Right
and Easement for the discharge of sewage and drainage of storm water through the
existing sanitary sewer and drainage system, including pipes, drains, manholes,
pumps, mains and other devices or equipment related thereto as are now located
on, above or under Parcel A and/or Parcel C or shown on the Site Plan and are
designed for the discharge of sewage or drainage of storm water; provided,
however, that the owner of Parcel D shall, at its sole expense, install its own
sanitary sewer system on or before the date which is eighteen (18) months from
the date hereof.
(e) Reservation of Rights. Without in any way limiting the rights of the
fee owner(s) of Parcel A and Parcel B and Parcel C, there are hereby reserved to
the owner(s) of Parcel A and Parcel B and Parcel C all rights in and to the
Easement Areas located on Parcel A and Parcel B and Parcel C, respectively, to
the extent such rights are not inconsistent with and do not materially interfere
with the use of the Easement Areas by the owner of Parcel D and the exercise by
the owner of Parcel D of the Easements and Non-Exclusive Rights granted pursuant
to Section 2.04 hereof.
(f) Further Actions. The Easements and Non-Exclusive Rights granted in
this Section 2.04 shall include the right on the part of the owner of Parcel D
to take such other actions as may be reasonably necessary for the full exercise
of the Easements and Non-Exclusive Rights specified herein.
SECTION 2.05. Utility Cost Sharing. The Parties shall request that the
applicable supplier send bills for the water supplied by the City water mains
described on Schedule 4.01 directly to the owners of such mains. Declarant
shall, at its expense, install a submeter on all branch lines off any of the
mains described on Schedule 4.01. Each owner of a Parcel served by a branch line
off one of the mains described on Schedule 4.01 shall, at its expense, maintain
the submeter on such branch line. Each owner of a water main described on
Schedule 4.01 shall pay all charges for water supplied through such main
directly to the City of New York or other applicable public authority or utility
company (each, a "Utility Supplier") and shall bill the owners of any Parcel
served by a branch line described in Schedule 401 for its share of such
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water charges based on readings of the submeters described above at the same
rate it pays to the Utility Supplier. The owners of the other Parcels shall pay
such bills within 30 days after they are received. Sewer charges, if any, shall
be paid and billed in the same manner.
SECTION 2.06. Condition of Easements. The Non-Exclusive Rights and
Easements established hereby are subject to any existing state of facts
affecting the respective Easement Areas, and Declarant makes no representation,
covenant or warranty as to the condition of any such Easement Area.
SECTION 2.07. Fire Alarm System. The owner of each Parcel shall insure
that its fire alarm system will identify the location of a fire on that Parcel,
as opposed to the general location of a fire on the Property, to the central
control room on such Parcel. The Owner of Parcel D shall also be responsible for
the maintenance, repair and replacement of the fire alarm located at the A-10
dock facility, but only for so long as that certain A-10 Dock License Agreement
to be entered into between Declarant and the owner of Parcel D is in effect.
SECTION 2.08. Emergency Response. The owners of the Parcels shall
individually or collectively maintain on-site personnel familiar with plant
equipment and operations whose duties shall include responding to alarms and
assisting the Fire Department or other emergency responder in accordance with
emergency response procedures to be developed with the Fire Department and other
emergency response agencies.
ARTICLE III
Term of Easements; Abandonment
SECTION 3.01. Term. Subject to the terms of Sections 3.02 and 5.03 hereof,
all Easements and Non-Exclusive Rights granted herein shall be perpetual. No
Easement or Non-Exclusive Right granted herein shall expire, terminate or be
deemed abandoned without the prior written approval of the New York City
Department of Buildings and/or the New York City Department of Business
Services, as applicable, or such other Governmental Authorities succeeding to
their jurisdiction.
SECTION 3.02. Abandonment of Easements. Subject to receipt of the prior
written approval of the New York City Department of Buildings and/or the New
York City Department of Business Services, if required, the owner of a Parcel
benefitting from an Easement or Non-Exclusive Right under this Declaration may
from time to time, upon not less than thirty days' notice to the owner of the
Easement Area, release its Easement or Non-Exclusive Right with respect thereto.
Any such notice shall (x) specify the effective date of such Release and (y) be
accompanied by evidence reasonably satisfactory to the owner of the Easement
Area that such abandonment has been approved by the New York City Department of
Buildings and, to the extent necessary, the New York City Department of Business
Services. The Party benefitting from the Easement Area shall take such measures
as shall be required to effectuate the Release. Such measures shall include the
following: (i) in the case of any Easement or Non-Exclusive Right for domestic
water, to the extent necessary, the cutting, capping, removal or disabling of
any pipes, pumps, mains and other devices; (ii) in the case of any Easement or
Non-Exclusive Right for fire protection water, the cutting, capping, removal or
disabling of any pipes, pumps or mains; (iii) in the case of any Easement for
access, the erection of such wall, gate or other barrier required to prevent any
person, party or vehicle from gaining access to the Easement Area from the
benefitted Parcel; and (iv) in the case of sewer lines, the cutting and/or
capping of any pipes used to discharge sewage and drainage water and the
disabling or removal of any pipes, manholes, mains and other devices. Whenever
an Easement or Non-Exclusive Right is released
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in accordance with the terms of this Section 3.02, (A) the owner of the Parcel
formerly burdened by such Easement Area shall execute and deliver to the
Releasee such documents in recordable form as shall be reasonably required to
evidence the Release, (B) the Releasor shall have no further obligation or
liability to the owner of the affected Easement Area; and (C) the Releasee shall
have no further obligation or liability to the Releasor with respect to such
Easement or Non-Exclusive Right.
ARTICLE IV
Use, Repair and Maintenance of Easements
SECTION 4.01. Maintenance Obligation. Each Party shall, at its sole cost
and expense, with respect to each Easement Area located on or within such
Party's Parcel (i) maintain the surface and subsurface of the improved portions
of the Easement Area in good repair and condition, (ii) keep the Easement Area
reasonably free of obstructions (including snow and ice) and adequately
illuminated, (iii) maintain the security of the Easement Area, and (iv) maintain
the facilities located within such Easement Area which are necessary for the
exercise of the Non-Exclusive Rights and Easements with respect thereto
(including all pipes, mains and other devices or equipment related thereto) in
good repair and condition. As used in this Section 4.01, the term "maintain"
shall include repair and/or replacement, to the extent applicable. Each Utility
shown on the Site Plan, except for roads, shall be owned and maintained in
accordance with Schedule 4.01 attached hereto and made a part hereof. Roads
shall be maintained by the Party on whose Parcel the road is located. Guard
service costs shall be billed to and paid by the owner of Parcel A and then
apportioned among the Parties in accordance with the size of each Party's Parcel
which is benefitted thereby.
SECTION 4.02. Failure to Maintain. If a Party (the "Defaulting Party")
fails to perform any obligation set forth herein, the other Party (the "Curing
Party") shall have the right to perform the actions which the Defaulting Party
failed to perform in accordance with this Declaration (the "Self-Help Rights")
and shall be entitled to Entry Rights and Reimbursement Rights with respect
thereto. Notwithstanding the foregoing, Self-Help Rights may only be exercised
after failure of the Defaulting Party to perform any actions required to be
performed pursuant to this Declaration (i) if no emergency exists, within thirty
days after notice from the Curing Party, or if such failure is not curable
within said period, within such longer period as is reasonably necessary to cure
such failure, provided the Defaulting Party begins to cure such failure within
such thirty-day period and thereafter diligently prosecutes the same to
completion; and (ii) in any emergency situation, immediately upon written or
(notwithstanding any other provisions of this Declaration) verbal notice, if
prior notice is practicable, or, if such notice is not practicable, then without
giving prior notice to the Defaulting Party, provided that the Curing Party
shall, in such circumstances, give the Defaulting Party notice thereof as soon
thereafter as practicable. All work to be performed by the Curing Party so
acting under the provisions of this Declaration shall be performed in accordance
with Section 4.07.
SECTION 4.03. Use of Easement Area During Maintenance. During the
performance of any maintenance work required or permitted hereunder, each Party
shall have the right, at its own risk, to use the affected Easement Area for the
purposes contemplated herein; provided, however, that each Party shall keep such
Easement Area free of obstructions, and shall implement such other safety and
similar measures as may be required by law or reasonably necessary from time to
time to assure the other Party safe and convenient access to its Parcel, and
neither Party shall materially adversely affect or substantially interfere with
the other Party's use of any such Easement Area.
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SECTION 4.04. General Use Conditions. No Party shall use an Easement or
Non-Exclusive Right in accordance herewith in such a manner so as to reduce,
injure, overload, deface, harm or impair the applicable Easement Area or
Utility, so as to allow or suffer any waste thereof, or so as to commit any
nuisance by its use thereof. Any damage caused by a Party or its Permittees in
violation of this provision shall be promptly repaired by the Party that caused,
or whose Permittees caused, such damage. No Party shall materially adversely
affect, materially deprive of a benefit associated with, materially impose a
burden on, or substantially interfere with, the other Party's use of the
Utilities, Non-Exclusive Rights and/or Easements that are the subject of this
Declaration.
SECTION 4.05. Compliance with Law. All Parties shall use the Easement
Areas and Utilities, including roads, in compliance with all applicable
licenses, permits and approvals, and otherwise in compliance with all applicable
laws (including environmental laws), ordinances, orders, codes, rules and
regulations (including all fire safety and site security requirements imposed by
law or mutually agreed to by the Parties from time to time). All Parties shall
own, operate and maintain their respective Parcels and Easements Areas in
accordance with applicable licenses, permits and approvals, and otherwise in
compliance with all applicable laws, ordinances, orders, codes, rules and
regulations of Governmental Authorities. Notwithstanding anything to the
contrary contained herein, nothing in this Declaration shall be construed to
relieve any Party of its duty under the New York City Administrative Code or
other laws and regulations to maintain in a safe condition the Utilities and
other facilities located on its property, including but not limited to fire
protection and suppression devices and equipment.
SECTION 4.06. Notification of Proposed Activity. Whenever a proposed
activity of a Party is reasonably expected to have an adverse impact on the use
by another Party of an Easement Area on such Party's Parcel, or the use of the
Utilities available therefrom, the Party proposing such activity shall notify
the other Party of such proposed activity reasonably in advance, so that the
other Party may implement reasonable measures designed to mitigate the impact
thereof. The cost of such protective measures shall be chargeable to the Party
proposing such activity. This notification requirement shall apply in all cases,
including emergencies, provided that in the case of emergency, the notice given
shall be such notice as is reasonably practicable under the circumstances.
SECTION 4.07. Performance of Work. All work to be performed under this
Declaration by a Party (the "Entering Party") in or affecting the Easement Areas
on its Parcel or the Utilities available therefrom or the Parcel of the other
Party (i) shall not impair the structural integrity of any improvement situated
on either Parcel; (ii) shall not be undertaken until the Entering Party shall
have procured and paid for all required Permits; (iii) except for routine
maintenance activity, shall not be undertaken until the Entering Party shall
have submitted to the other Party all applicable drawings, plans,
specifications, engineering plans and related information and, except in
connection with the exercise of Self-Help Rights, obtained the consent of the
other Party to the work to be performed, which consent shall not be unreasonably
withheld or delayed; (iv) shall be performed in accordance with good industry
practice and in compliance with all applicable laws, ordinances, orders, codes,
rules and regulations; (v) shall be performed by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by the
other Party of the affected Utility, Easement Areas or Parcel, and (vii) shall
be diligently prosecuted to completion. During any construction or
reconstruction work, the construction site shall be kept in an orderly, clean
and safe condition. The Entering Party shall pay when due all claims for labor
performed or material furnished and not permit any mechanics' or materialmen's
lien to attach, and if any such liens do attach, the Entering Party shall
immediately bond such liens in accordance with any
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applicable statutory provision. Except in connection with the exercise of
Self-Help Rights, the Entering Party shall also be responsible for the
professional fees incurred by the other Party in reviewing the Entering Party's
plans and drawings, whether or not consent thereto shall be given. The review
of, comments on, or consent to any documents, drawings, plans, specifications or
other documentation provided by the Entering Party shall not relieve the
Entering Party of, or affect in any way, its responsibility for the correctness
and adequacy of the work to be performed. The other Party shall have no
liability whatsoever with respect to any review or non-review of or consent to
any documentation submitted to it by the Entering Party.
SECTION 4.08. Notice of Entry. Whenever the Entering Party shall intend to
enter upon an Easement Area located upon the Parcel of another Party to perform
any work, the Entering Party shall give the affected Party (i) at least
twenty-four (24) hours' prior written notice in the case of routine maintenance,
(ii) prior written notice in accordance with Section 4.07(iii) hereof in the
case of any more significant work or (iii) immediate verbal notification
followed by written notice in the case of any emergency.
SECTION 4.09. Relocation of Easements. The owner of any Easement Area may
elect to change the location of all or any portion of the Easement Area, on not
less than ninety days' prior written notice to the owner of the parcel
benefitted by any Easement or Non-Exclusive Right specifying the proposed
effective date of such relocation. The owner of the benefitted parcel shall have
thirty days from receipt of said notice to approve the relocation, with or
without modification, such approval to serve as evidence that any such
relocation shall not deprive the benefitted party of the practical realization
of the benefits of such Easement Area. Upon receipt of the written approval of
the benefitted party, the Owner of the Easement Area seeking the relocation
shall obtain the approval of the New York City Department of Buildings and/or
the New York City Department of Business Services, as applicable. No relocation
shall become effective unless and until such governmental approval shall have
been obtained. Any such relocation shall occur at the sole cost and expense to
the Easement Area owner. Any relocated Easement or Non-Exclusive Right shall be
subject to all of the terms, covenants and conditions of this Declaration. Upon
the relocation of any Easement Area pursuant to the terms of this Section 4.09,
the owner of the Parcel benefitted shall execute and deliver to the owner of the
Parcel formerly burdened such documents in recordable form as the owner of the
former Easement shall require to evidence the Release and/or relocation thereof.
ARTICLE V
Casualty; Condemnation
SECTION 5.01. Restoration Work. Except as set forth in Section 5.03, if
any of the facilities, equipment and systems located within an Easement Area
which provides any Utility is damaged or destroyed by fire or other casualty
("Casualty"), the owner of the Easement Area shall commence the repair or
restoration as expeditiously as is practicable in the circumstances, and shall
diligently prosecute such repair or restoration to completion in accordance with
the standards of work and other requirements set forth in Section 4.07. Failure
of the owner of the affected Easement Area to comply with such obligation
shall give rise to Self-Help Rights (and correlative Reimbursement Rights) and
other remedies in favor of the owner of the affected Parcel. Notwithstanding the
foregoing, any infrastructure, including any equipment or roads, exclusively for
the benefit of or owned by the owner of a Parcel, shall be repaired or restored
by the owner to whom it is reserved or by whom it is owned, as the case may be,
notwithstanding its location on another Party's Parcel.
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SECTION 5.02. Condemnation. Except as set forth in Section 5.03, in the
event that a Parcel or a portion thereof containing an Easement Area shall be
taken by any Governmental Authority in the exercise of the power of eminent
domain (each, a "Taking" with the term "Taken" construed accordingly), each
affected Easement or Non-Exclusive Right hereunder shall terminate, to the
extent affected by such Taking, as of the date the owner of the Easement Area is
divested of title, unless the instrument of Taking expressly provides otherwise,
and the award attributable to such Taking shall, if not separately awarded to
the Parties with respect to their separate interests by the condemning
authority, be equitably allocated between the Parties, as their respective
interests may appear. The control of the condemnation proceeding shall always be
vested in the fee owner of the Easement Area being Taken. Nothing herein shall
preclude the Party affected from pursuing any claims against the condemning
authority with respect to the loss of the Easements or Non-Exclusive Rights
granted herein or the costs of relocation, and all awards with respect to such
facilities or costs shall be the exclusive property of such Party.
SECTION 5.03. Relocation of an Easement After Casualty or Condemnation.
Notwithstanding the foregoing provisions of this Article V, in the event of a
casualty or condemnation which results in the complete or substantial
destruction or unusability or relocation of any Easement or Non-Exclusive Right,
the beneficiary thereof shall, to the extent commercially practical, restore the
affected Utilities, if any, in a manner that an Easement or Non-Exclusive Right
is no longer required.
ARTICLE VI
Miscellaneous Provisions
SECTION 6.01. Force Majeure. (a) Notwithstanding anything in this
Declaration to the contrary, no Party shall have any liability or be otherwise
responsible to the other for its failure to carry out its obligations, with the
exception of any obligation to pay money, under this Declaration if and only to
the extent that it becomes impossible for either Party to so perform as a result
of any Force Majeure Event.
(b) If a Party shall rely on the occurrence of a Force Majeure Event as a
basis for being excused from performance of its obligations under this
Declaration, then the Party relying on such occurrence shall (i) provide prompt
written notice of such Force Majeure Event to the other Party(ies) giving an
estimate of its expected duration and the probable impact on the performance of
its obligations hereunder, (ii) exercise its reasonable best efforts to continue
to perform its obligations under this Declaration, (iii) expeditiously take
action to correct or cure the Force Majeure Event (provided that settlement of
strikes or any other labor dispute will be completely within the sole discretion
of the Party affected by such strike or labor dispute), (iv) exercise its
reasonable best efforts to mitigate or limit damages to the other Party and (v)
provide prompt notice to the other Party(ies) of the cessation of the Force
Majeure Event.
SECTION 6.02. Default and Remedies. In the event that a Party defaults,
breaches or otherwise fails to perform any obligation of such Party under this
Declaration, the other Party shall have the right to all remedies available at
law or in equity, including the right to injunctive relief and the right to
exercise its Self-Help Rights (and shall be entitled to correlative
Reimbursement Rights in connection therewith) without any requirement to pursue
or exhaust any other remedies available to such Party under any other agreement.
All such remedies shall be cumulative and not exclusive. A Party shall have the
right, following notice to the other Party,
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to take such action as it may deem necessary or advisable, including payment of
any delinquent Taxes, to prevent a foreclosure for nonpayment of Taxes or other
action by a Governmental Authority that might affect its rights and interests
hereunder and any such action shall be deemed an exercise of Self-Help Rights
(and, accordingly, give rise to correlative Reimbursement Rights). In the event
a Party is entitled to Reimbursement Rights hereunder and same are not satisfied
within thirty days after written demand by the Party entitled to same, the
unpaid obligations shall constitute a lien against the defaulting Party's
Parcel; provided, however, that the payment of any monetary obligations which
become due and payable by a Party after recordation of a mortgage on such
Party's Parcel granted to an independent third party regularly engaged in the
business of making mortgage loans shall be subordinate to the payment of the
obligations secured by such mortgage.
SECTION 6.03. Mortgagees' Status. Except as set forth in Section 6.02
hereof, this Declaration shall be superior to any mortgages or other instruments
evidencing security for indebtedness granted by either Party from time to time
with respect to its Parcel. Accordingly, each Party agrees to obtain and deliver
to the other Party such documents and instruments, in recordable form, as may be
reasonably necessary or requested by the other Party to evidence and confirm the
subordination of any such mortgages or other security instruments to the
provisions of this Declaration.
SECTION 6.04. Estoppel Certificate. Each Party agrees, within ten (10)
days after written request by the other, to execute, acknowledge and deliver to
and in favor of any present or proposed lender, Mortgagee, ground lessor,
purchaser, tenant or the like of all or any part of the other Party's Parcel, an
estoppel certificate, in a form reasonably satisfactory to such lender,
Mortgagee, ground lessor, purchaser, tenant or the like, stating, among other
things: (i) whether this Declaration is in full force and effect; (ii) whether
this Declaration has been modified or amended and, if so, identifying and
describing any such modification or amendment; (iii) whether there are any sums
then due and owing under this Declaration from either Party to the other, and if
so, specifying the amount thereof and reason therefor; and (iv) whether the
Party giving such certificate knows of any default (or event which, with the
passage of time, the giving of notice, or both, would constitute a default) on
the part of the other Party, or has any outstanding claim against the other
Party arising under this Declaration and, if so, specifying the nature of such
default or claim.
SECTION 6.05. No Dedication. Nothing contained in this Declaration shall
be deemed to be a gift or dedication of any portion of either Parcel to the
general public or for any public use or purpose whatsoever, or, except as
expressly set forth herein, be deemed to create any rights or benefits in favor
of any municipality, public authority or official thereof, it being the
intention of the Parties that this Declaration be for the exclusive benefit of
the owner or owners, from time to time, of the Parcels, or any part thereof, and
those claiming under them.
SECTION 6.06. Covenants Running With Land. The benefits and burdens,
rights and obligations, Easements, Non-Exclusive Rights and restrictions created
by this Declaration shall be appurtenant to and run with and burden and be
binding upon Parcel A, Parcel B, Parcel C and Parcel D, and shall inure to the
benefit of and be binding upon Declarant and those claiming by, through, or
under it. The covenants, agreements, terms, provisions and conditions of this
Declaration shall bind and benefit the successors in interest (as owners of
Parcel A, Parcel B, Parcel C and Parcel D, respectively, whether by sale,
foreclosure or otherwise) of Declarant with the same effect as if mentioned in
each instance when a Party is named or referred to, it being understood and
agreed that upon any transfer of ownership (whether by sale, foreclosure or
otherwise) of all or any part of Parcel A, Parcel B, Parcel C and Parcel D, as
the case may be, each such successor in interest shall, without the requirement
of any further documentation,
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thereupon and thereafter assume, and perform and observe, any and all of the
obligations of its predecessors in interest under this Declaration with respect
to such Parcel (or portion thereof). Notwithstanding the foregoing, (a) each
Party shall use reasonable efforts to cause any such successor in interest to
execute an agreement in recordable form pursuant to which such successor in
interest shall assume any and all obligations of its predecessors in interest
under this Declaration; provided, however, that the failure to obtain any such
agreement shall not detract from the provisions of the previous sentence, and
(b) no Party shall be released from any liability for such obligations (whether
arising before or after any such transfer of ownership) without the prior
written consent of all of the other Parties, provided that Declarant shall be
released from its liability for obligations relating to Parcel B, Parcel C
and/or Parcel D upon its conveyance of each such Parcel as contemplated by this
Declaration.
SECTION 6.07. No Merger. The acquisition by the owner from time to time of
Parcel A of any interest in and to Parcel B or Parcel C or Parcel D, or the
acquisition by the owner from time to time of Parcel B of any interest in and to
Parcel A or Parcel C or Parcel D, or the acquisition by the owner from time to
time of Parcel C of any interest in and to Parcel A or Parcel B or Parcel D, or
the acquisition by the owner from time to time of Parcel D of any interest in
and to Parcel A or Parcel B or Parcel C, shall not result in an impairment or
extinguishment by merger of any right, Easement or obligation granted or created
hereby. No merger shall result unless and until (a) one person or entity owns
the fee title to Parcel A, Parcel B, Parcel C and Parcel D in their entirety and
(b) written consents to such merger and termination of this Declaration shall
have been obtained (and recorded with the Office of the City Register of Queens
County) from all holders of mortgages then of record with respect to any portion
of Parcel A, Parcel B, Parcel C or Parcel D.
SECTION 6.08. Assignment; No Third Party Beneficiaries. (a) This
Declaration and all of the provisions hereof shall be binding upon and inure to
the benefit of Declarant and its successors and permitted assigns but neither
this Declaration nor any of the rights, interests or obligations hereunder shall
be assigned by any Party, including by operation of law, without the prior
written consent of the other Party(ies), except (A) to a Party acquiring all or
any part of a Parcel, or (B) to a lending institution or trustee in connection
with a pledge or granting of a security interest in all or any part of the
Parcel owned by such Party;
(b) Nothing in this Declaration is intended to confer upon any other
person except the Parties any rights or remedies hereunder or shall create any
third party beneficiary rights in any person.
SECTION 6.09. Notices. (a) Unless otherwise specified herein, all notices
and other communications hereunder shall be in writing and shall be deemed given
(as of the time of delivery or, in the case of a telecopied communication, of
confirmation) if delivered personally, telecopied (which is confirmed) or sent
by overnight courier (providing proof of delivery) to the Parties at the
following addresses (or at such other address for a Party as shall be specified
by like notice):
if to Declarant, to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Attention: Director of Real Estate
With a copy to:
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Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Attention: General Counsel
(b) In the event any Party shall desire or shall be required to send any
notice to the Department of Buildings and/or to the Department of Business
Services, any such notice shall be sent in the manner described in Section
6.09(a) above addressed as follows:
if to the Department of Buildings, to:
New York City Department of Buildings
Office of General Counsel
60 Hudson Street
New York, New York 10013, or at its then official address
if to the Department of Business Services, to:
New York City Department of Business Services
Office of General Counsel
110 William Street
New York, New York 10038,
or at its then official address.
SECTION 6.10. Extension; Waiver. Any Party may (i) extend the time for the
performance of any of the obligations or other acts of the other Party(ies) or
(ii) waive compliance by the other Party(ies) with any of the agreements or
conditions contained in this Declaration. Any agreement on the part of a Party
to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such Party. The failure of a Party to
this Declaration to assert any of its rights under this Declaration or otherwise
shall not constitute a waiver of such rights.
SECTION 6.11. Amendment and Modification. This Declaration may be
amended, modified or supplemented only by an instrument in writing signed on
behalf of each of the Parties; provided, however, that no such amendment (other
than an amendment of Section 2.05 hereof) shall be effective without the prior
written approval of the New York City Department of Buildings or the New York
City Department of Business Services, as applicable.
SECTION 6.12. Governing Law. This Declaration shall be governed by and
construed in accordance with the laws of the State of New York (regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law).
SECTION 6.13. Interpretation. When a reference is made in this Declaration
to an Article, Section, Schedule or Exhibit, such reference shall be to an
Article or Section of, or Schedule or Exhibit to, this Declaration unless
otherwise indicated. The table of contents and headings contained in this
Declaration are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Declaration. Whenever the words "include",
"includes" or "including" are used in this Declaration, they shall be deemed to
be followed by the words "without limitation". The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Declaration shall
refer to this Declaration as a whole and not to any particular provision of this
Declaration. All terms defined in this Declaration shall have the defined
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meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein. The definitions contained in
this Declaration are applicable to the singular as well as the plural forms of
such terms and to the masculine as well as to the feminine and neuter genders of
such term. Any agreement, instrument, statute, regulation, rule or order defined
or referred to herein or in any agreement or instrument that is referred to
herein means such agreement, instrument, statute, regulation, rule or order as
from time to time amended, modified or supplemented, including (in the case of
agreements or instruments) by waiver or consent and (in the case of statutes,
regulations, rules or orders) by succession of comparable successor statutes,
regulations, rules or orders and references to all attachments thereto and
instruments incorporated therein. References to a person are also to its
permitted successors and assigns.
SECTION 6.14. Jurisdiction and Enforcement. (a) Each of the Parties
irrevocably submits to the exclusive jurisdiction of (i) the Supreme Court of
the State of New York, New York County and (ii) the United States District Court
for the Southern District of New York, for the purposes of any suit, action or
other proceeding arising out of this Declaration or any transaction contemplated
hereby. Each of the Parties agrees to commence any action, suit or proceeding
relating hereto either in the United States District Court for the Southern
District of New York or, if such suit, action or proceeding may not be brought
in such court for jurisdictional reasons, in the Supreme Court of the State of
New York, New York County. Each of the Parties further agrees that service of
process, summons, notice or document by hand delivery or U.S. registered mail at
the address specified for such Party in Section 6.09 (or such other address
specified by such Party from time to time pursuant to Section 6.09) shall be
effective service of process for any action, suit or proceeding brought against
such Party in any such court. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Declaration or the transactions contemplated
hereby in (i) the Supreme Court of the State of New York, New York County, or
(ii) the United States District Court for the Southern District of New York, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
(b) The parties agree that irreparable damage would occur in the event
that any of the provisions of this Declaration were not performed in accordance
with their specific terms or were otherwise breached. It is accordingly agreed
that the Parties shall be entitled to an injunction or injunctions to prevent
breaches of this Declaration and to enforce specifically the terms and
provisions of this Declaration, this being in addition to any other remedy to
which they are entitled at law or in equity.
SECTION 6.15. Severability. If any term or other provision of this
Declaration is invalid, illegal or incapable of being enforced by any rule of
law or public policy, all other conditions and provisions of this Declaration
shall nevertheless remain in full force and effect. Upon such determination that
any term or other provision is invalid, illegal or incapable of being enforced,
the Parties shall negotiate in good faith to modify this Declaration so as to
effect the original intent of the Parties as closely as possible to the fullest
extent permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
SECTION 6.16. Property Treated as Single Zoning Lot. Declarant agrees that
no breach by any Party shall have any effect on the treatment of the Property
covered by this Declaration as one zoning lot and the Property shall be treated
as one zoning lot unless such
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zoning lot is subdivided in accordance with the provisions of the Zoning
Resolution.
IN WITNESS WHEREOF, Declarant has caused this Declaration to be signed by
its duly authorized officer as of the date first above written.
CONSOLIDATED EDISON COMPANY OF
NEW YORK, INC.
By:___________________
Name:
Title:
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STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this __ day of _______ 1999, before me personally appeared
______________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
corporation upon behalf of which the individual acted, executed the instrument.
___________________________
NOTARY PUBLIC
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EXHIBIT A
Legal Description of Parcel A
To be prepared by GEOD Corporation prior to the recording of this
Declaration, which description shall be substantially in accordance with Parcel
A as shown on the Astoria Generating Station ALTA/ACSM Land Title Survey dated
February 17, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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EXHIBIT B
Legal Description of Parcel B
To be prepared by GEOD Corporation prior to the recording of this
Declaration, which description shall be substantially in accordance with Parcel
B as shown on the Astoria Generating Station ALTA/ACSM Land Title Survey dated
February 17, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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EXHIBIT C
Legal Description of Parcel C
To be prepared by GEOD Corporation prior to the recording of this
Declaration, which description shall be substantially in accordance with Parcel
C as shown on the Astoria Generating Station ALTA/ACSM Land Title Survey dated
February 17, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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EXHIBIT D
Legal Description of Parcel D
To be prepared by GEOD Corporation prior to the recording of this
Declaration, which description shall be substantially in accordance with Parcel
D as shown on the Astoria Generating Station ALTA/ACSM Land Title Survey dated
February 17, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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EXHIBIT E
Site Plan
Astoria Generating Station ALTA/ACSM Land Title Survey dated February 17,
1999, as may be hereafter revised, prepared by GEOD Corporation.
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Schedule 4.01
Ownership Rights and Maintenance Obligations of Parcel Owners
Ownership Rights and Maintenance Obligations of Parcel A Owner
Domestic Water / Fire Protection Water
1. The owner of Parcel A owns and is responsible for all maintenance of fire
hydrants located on Parcel A that are supplied by the two 20-inch city
water mains that provide domestic and fire protection water to Parcel B.
2. The owner of Parcel A owns and is responsible for all maintenance of the
city water piping located on Parcel A, with the exception of the two
20-inch city water mains routed to Parcel B and the 8-inch city water main
routed to Parcel D, and the 8-inch city water main routed to Parcel C, as
designated on the Site Plan.
3. The owner of Parcel A owns and is responsible for all maintenance of an
8-inch city water main that provides domestic and fire protection water at
the Liquid Natural Gas Facility. The owner of Parcel A shall own this city
water header from the branch connection located on Parcel C, as designated
on the Site Plan.
4. The owner of Parcel A owns and is responsible for all maintenance of a
2-inch city water pipe that provides domestic water to the Central Waste
Water Treatment Plant, as designated on the Site Plan. The owner of Parcel
A shall own the city water header from the branch connection off the
20-inch supply header to Parcel B that originates at city water meter
house "A" as designated on the Site Plan.
Sewer Lines and Drainage Systems
1. The owner of Parcel A owns and is responsible for the sanitary sewer
piping from the two twelve-inch branch connections that exist on Parcel B
and for all sanitary and storm sewers existing on Parcel A as designated
on the Site Plan.
2. The owner of Parcel A owns and is responsible for all maintenance of the
36-inch "Southwest Storm Sewer" that originates on Parcel A and is routed
to the East River across Parcel B as designated on the Site Plan. The
owner of Parcel A also owns and is responsible for the oil water separator
associated with this storm sewer that is located on Parcel B.
3. The owner of Parcel A owns and is responsible for the maintenance of the
20-inch storm sewer that extends onto Parcel B along 9th Street in the
vicinity of the Power Authority Gas Regulator House as designated on the
Site Plan.
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Ownership Rights and Maintenance Ob1igations of Parcel B Owner
Domestic Water / Fire Protection
1. The owner of Parcel B owns (as a tenant in common with at third party) and
is responsible for all maintenance of the two 20-inch city water mains
routed across Parcel A that originate at city water meter houses "A" and
"B" as designated on the Site Plan. The owner of Parcel B is also
responsible for the maintenance of the city water meter houses and all
equipment appurtenant to these mains excluding any fire hydrants located
on Parcel A.
Sewer Lines and Drainage Systems
1. The owner of Parcel B owns (as a tenant in common with a third party) and
is responsible for the maintenance of the 12-inch sanitary sewer existing
on Parcels A and B except for the portions of the 12-inch branch
connection routed from Parcel A which are on Parcel A and/or Parcel B,
which are owned and maintained by the owner of Parcel A, as designated on
the Site Plan,
2. The owner of Parcel B owns and is responsible for the maintenance of the
storm sewer catch basin located on Parcel B along 9th Street. The owner of
Parcel B also owns and is responsible for the maintenance of the piping
that connects this catch basin to the 20-inch storm sewer that is owned by
Parcel A.
Ownership Rights and Maintenance Obligations of Parcel C Owner
Domestic Water / Fire Protection
1. The owner of Parcel C owns and is responsible for all maintenance of the
8-inch city water main originating on Parcel A from the branch connection
that supplies Parcel C, as designated on the Site Plan.
Sewer Lines and Drainage Systems
1. The owner of Parcel C owns and is responsible for the maintenance of all
storm sewers existing on Parcel C as designated on the Site Plan. The
owner of Parcel C is also responsible for the 12 inch storm drain that
originates on Parcel C and extends onto Parcel A as designated on the Site
Plan.
Ownership Rights and Maintenance Obligations of Parcel D Owner
Domestic Water / Fire Protection
1. The owner of Parcel D owns and is responsible for all maintenance of the
8-inch city water main originating on Parcel C from the branch connection
to Parcel D, as designated on the Site Plan, The owner of Parcel D also
owns and is responsible for all maintenance of the 65,000-gallon fire
reserve tank that is located on Parcel C.
2. Subject to the provisions of the last sentence of Section 2.07, the owner
of Parcel D owns and is responsible for maintenance and testing of the
Fire Alarm pull box located on that portion of Parcel A designated on the
Site Plan as the "A-10 dock".
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Sewer Lines and Drainage Systems
1. The owner of Parcel D owns and is responsible for the maintenance of all
storm sewers existing on Parcel D as designated on the Site Plan.
2. The owner of Parcel D owns and is responsible for the maintenance of the
sanitary sewer septic system that extends onto Parcel A. This system is to
be relocated to Parcel D on or before that date that is 18 months from the
date hereof.
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EXHIBIT J
GOWANUS
DECLARATION OF SUBDIVISION EASEMENTS
By
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
Dated as of o, 1999
The land affected by the within instrument lies in Block 653, Lot 3 on the
Tax Map of the City of New York, Kings County
Address:
Record and return to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, New York 10003
Attention: Robert Selya, Esq.
256
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Definitions ................................................. 1
ARTICLE II
Declaration of Easements
SECTION 2.01. Grant of Easements for the Benefit of Parcel A .............. 3
SECTION 2.02. Grant of Easements for the Benefit of Parcel B .............. 4
SECTION 2.03. Utility Cost Sharing ........................................ 4
SECTION 2.04. Condition of Easements ...................................... 5
SECTION 2.05. Emergency Response........................................... 5
ARTICLE III
Term of Easements; Abandonment
SECTION 3.01. Term ........................................................ 5
SECTION 3.02. Abandonment of Easements .................................... 5
ARTICLE IV
Use, Repair and Maintenance of Easements
SECTION 4.01. Maintenance Obligation ...................................... 6
SECTION 4.02. Failure to Maintain ......................................... 6
SECTION 4.03. Use of Easement Area During Maintenance ..................... 6
SECTION 4.04. General Use Conditions ...................................... 6
SECTION 4.05. Compliance with Law ......................................... 7
SECTION 4.06. Notification of Proposed Activity ........................... 7
SECTION 4.07. Performance of Work ......................................... 7
SECTION 4.08. Notice of Entry ............................................. 8
SECTION 4.09. Relocation of Easements ..................................... 8
ARTICLE V
Casualty; Condemnation
SECTION 5.01. Restoration Work ............................................ 8
SECTION 5.02. Condemnation ................................................ 8
SECTION 5.03. Relocation of an Easement After Casualty or Condemnation .... 9
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ARTICLE VI
Miscellaneous Provisions
SECTION 6.01. Force Majeure ............................................... 9
SECTION 6.02. Default and Remedies ........................................ 9
SECTION 6.03. Mortgagees' Status .......................................... 10
SECTION 6.04. Estoppel Certificate ........................................ 10
SECTION 6.05. No Dedication ............................................... 10
SECTION 6.06. Covenants Running With Land ................................. 10
SECTION 6.07. No Merger ................................................... 11
SECTION 6.08. Assignment; No Third Party Beneficiaries .................... 11
SECTION 6.09. Notices ..................................................... 11
SECTION 6.10. Extension; Waiver ........................................... 12
SECTION 6.11. Amendment and Modification .................................. 12
SECTION 6.12. Governing Law ............................................... 12
SECTION 6.13. Interpretation .............................................. 12
SECTION 6.14. Jurisdiction and Enforcement ................................ 13
SECTION 6.15. Severability ................................................ 13
SECTION 6.16. Property Treated as Single Zoning Lot ....................... 13
List of Exhibits and Schedules
Exhibit A Legal Description of Parcel A
Exhibit B Legal Description of Parcel B
Exhibit C Site Plan
Schedule 4.01 Ownership Rights and Maintenance Obligations of Parcel Owners
ii
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DECLARATION
GOWANUS DECLARATION OF SUBDIVISION EASEMENTS (including the Exhibits
and Schedules, this "Declaration") dated as of o, 1999 by CONSOLIDATED EDISON
COMPANY OF NEW YORK, INC., a New York corporation ("Declarant").
WHEREAS Declarant is the owner of the parcel of land described on
Exhibit A attached hereto and made a part hereof located in Kings County, New
York ("Parcel A") and the improvements located thereon, as shown on the Gowanus
Gas Turbine Site ALTA/ACSM Land Title Survey Conveyance Plan prepared by GEOD
Corporation dated February 23, 1999 attached hereto and made a part hereof as
Exhibit C (the "Site Plan");
WHEREAS Declarant is the owner of the parcel of land described on
Exhibit B attached hereto and made a part hereof located in Kings County, New
York ("Parcel B") and the improvements located thereon, as shown on the Site
Plan;
WHEREAS Parcel A and Parcel B are part of a single zoning lot as
that term is defined in Section 12-10 of the Zoning Resolution of the City of
New York, effective December 15, 1961, as amended from time to time, more
commonly known as Block 653, Lot 3 (collectively referred to as the "Property");
WHEREAS Declarant has operated the Property for the generation and
production of electrical energy as well as the transmission and distribution
thereof, and other uses related to the conduct of a public utility business;
WHEREAS Declarant has been ordered by the State of New York Public
Service Commission to divest certain generation plant assets;
WHEREAS in order to accomplish such divestiture, the portion of the
Property used for the generation and production of electrical energy (Parcel A)
will be sold to a third party and the portion of the Property used for
transmission, distribution and other purposes (Parcel B) will be retained by
Declarant;
WHEREAS in order to accomplish said proposed sale of Parcel A,
Declarant intends to subdivide the Property into two parcels, Parcel A and
Parcel B (each, a "Parcel," and, collectively, the "Parcels") without affecting
the single zoning lot status thereof; and
WHEREAS Declarant, in order to continue operations on the Parcels
and to satisfy the New York City Department of Buildings and the New York City
Department of Business Services, has created certain easements and made certain
declarations for the benefit of Parcels A and B as a condition of said
subdivision.
NOW, THEREFORE, Declarant, intending the Parcels to be legally bound
by the easements, covenants, conditions and restrictions hereinafter set forth,
declares as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. As used in this Declaration, the
following terms shall have the following meanings:
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"Casualty" shall have the meaning set forth in Section 5.01.
"Curing Party"" shall have the meaning set forth in Section 4.02.
"Declarant" shall have the meaning set forth in the Preamble.
"Defaulting Party" shall have the meaning set forth in Section 4.02.
"Easement" means, as applicable, any easement including related
rights intended for the primary benefit of Parcel A or Parcel B under this
Declaration.
"Easement Area" means an area, including roads and paths, on, above
or below the ground which burdens a Parcel with respect to which the owner of
the other Parcel is herein granted an Easement or Non-Exclusive Right.
"Entering Party" shall have the meaning set forth in Section 4.07.
The term "Entering Party" shall include a Party exercising Self-Help Rights as a
Curing Party.
"Entry Rights" means rights of any Party (including Self-Help
Rights) under this Declaration, to maintain an Easement Area; provided that such
rights shall be exercised in accordance with Section 4.07.
"Force Majeure Event" means any occurrence or event which is beyond
the reasonable control, and does not result from any fault or negligence, of the
Party affected, including any act of God, strike or other labor disturbance, act
of a public enemy, war, act of terrorism, riot, any other civil disturbance,
fire, storm, flood, lightning, earthquake, any other natural disasters,
explosion, materials shortage, breakage or accident to machinery or equipment,
any order or regulation or restriction imposed by any Governmental Authority,
failure of a contractor or subcontractor caused by a Force Majeure Event and
transportation delays or stoppages.
"Governmental Authority" means any court, administrative or
regulatory agency or commission or other governmental entity or instrumentality,
domestic, foreign or supranational or any department thereof.
"Mortgage" means the holder, from time to time, of a mortgage on
Parcel A or Parcel B, which holder has notified the owner of the other Parcel of
its interest as mortgagee and has provided such owner with a notice address.
"Non-Exclusive Right" means any right or Easement intended for the
common, mutual, or reciprocal benefit of Parcel A or Parcel B under this
Declaration.
"Parcel" shall have the meaning set forth in the Recitals and shall
include a portion of a Parcel.
"Party or Parties" shall mean the owner or owners from time to time
of all or any portion of a Parcel.
"Permittee" means the Parties and those claiming by, through or
under each of them and their respective officers, directors, trustees,
employees, agents, contractors, subcontractors, customers, visitors, invitees
and licensees.
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"Reimbursement Rights" means the rights of the Curing Party which
has exercised its Self-Help Rights (as defined below), to collect from the
Defaulting Party the reasonable costs and expenses actually expended by the
Curing Party in exercising its Self-Help Rights, including reasonable attorneys'
fees.
"Release" means the relinquishment by any Party of an Easement or
Non-Exclusive Right.
"Releasor" means the Party relinquishing an Easement or
Non-Exclusive Right and "Releasee" means the owner of the Easement Area affected
by a Release.
"Self-Help Rights" shall have the meaning set forth in Section 4.02.
"Taking" shall have the meaning set forth in Section 5.03.
"Taxes" shall mean all taxes, charges, fees, levies, penalties or
other assessments imposed by any state or local taxing authority, which, if
unpaid, could become a lien against a Parcel.
"Utility" or "Utilities" shall mean the essential services for which
Easements and Non-Exclusive Rights are granted under Article II.
"Zoning Resolution" shall mean the Zoning Resolution of the City of
New York, effective December 15, 1961, as amended from time to time.
ARTICLE II
Declaration of Easements
SECTION 2.01. Grant of Easements for the Benefit of Parcel A. Declarant,
as owner of Parcel B, hereby grants to Declarant, as appurtenant to and for the
benefit of Parcel A, the following rights and Easements intended to allow the
assets located on Parcel A to continue to operate, notwithstanding subdivision
of the Property:
(a) Easement for Domestic Water Supply. The Non-Exclusive Right and
Easement for domestic water supply to Parcel A through the existing water pipes,
mains and other devices or equipment related thereto located on Parcel B or
designated for such purposes on the Site Plan.
(b) Easement for Access. The Non-Exclusive Right and Easement to
use, and to permit its Permittees to use, in common with the owner(s) of Parcel
B and its Permittees, the area designated on the Site Plan as the "Emergency
Access to Gas Turbine Site" in accordance with the terms hereof, for emergency
vehicular access, ingress and egress to and from Parcel A over said Easement
Area to 27th Street.
(c) Easement for Fire Protection Water and Related Purposes (Fire
Service, Alarm, Hydrant). The Non-Exclusive Right and Easement for fire
protection water through the existing water pipes, mains, hydrants and other
devices or equipment related thereto located on Parcel B or designated for such
purposes on the Site Plan.
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(d) Easement for Sewer Lines and Drainage System. The Non-Exclusive
Right and Easement for the discharge of sewage and drainage of storm water
through the existing sanitary sewer and drainage system, including pipes,
drains, manholes, mains and other devices or equipment related thereto as are
now located on, above or under Parcel B or shown on the Site Plan and are
designed for the discharge of sewage or drainage of storm water.
(e) Reservation of Rights. Without in any way limiting the rights of
the fee owner of Parcel B, there are hereby reserved to the owner of Parcel B
all rights in and to the Easement Areas located on Parcel B, to the extent such
rights are not inconsistent with and do not materially interfere with the use
of the Easement Areas by the owner of Parcel A and the exercise by the owner of
Parcel A of the Easements and Non-Exclusive Rights granted pursuant to Section
2.01 hereof.
(f) Further Actions. The Easements and Non-Exclusive Rights granted
in this Section 2.01 shall include the right on the part of the owner of Parcel
A to take such other actions as may be reasonably necessary for the full
exercise of the Easements and Non-Exclusive Rights specified herein.
SECTION 2.02. Grant of Easements for the Benefit of Parcel B.
Declarant, as owner of Parcel A, hereby grants to Declarant, as appurtenant to
and for the benefit of Parcel B, the following rights and Easements intended to
allow the assets located on Parcel B to continue to operate, notwithstanding
subdivision of the Property:
(a) Easement for Domestic Water Supply. Intentionally Omitted.
(b) Easement for Access. Intentionally Omitted.
(c) Easement for Fire Protection Water and Related Purposes (Fire
Service, Alarm, Hydrant). Intentionally Omitted.
(d) Easement for Sewer Lines and Drainage System. Intentionally
Omitted.
(e) Reservation of Rights. Without in any way limiting the rights of
the fee owner of Parcel A, there are hereby reserved to the owner of Parcel A
all rights in and to the Easement Areas located on Parcel A, to the extent
such rights are not inconsistent with and do not materially interfere with the
use of the Easement Areas by the owner of Parcel B and the exercise by the owner
of Parcel B of the Easements and Non-Exclusive Rights granted pursuant to
Section 2.02 hereof.
(f) Further Actions. The Easements and Non-Exclusive Rights granted
in this Section 2.02 shall include the right on the part of the owner of
Parcel B to take such other actions as may be reasonably necessary for the full
exercise of the Easements and Non-Exclusive Rights specified herein.
SECTION 2.03. Utility Cost Sharing. (a) The cost of any Utilities
which are metered separately so as to measure the consumption of utility service
by the respective owners of Parcels A and B ("Metered Utilities") shall be
billed directly to and paid by the owners of the respective Parcels.
(b) The Parties shall request that the applicable supplier send
bills for Metered Utilities directly to the metered customer. The Parties shall
cooperate to assure that Utility bills are sent to the proper Party for payment
so as to avoid interest, penalties or other late charges.
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SECTION 2.04. Condition of Easements. The Non-Exclusive Rights and
Easements established hereby are subject to any existing state of facts
affecting the respective Easement Areas, and Declarant makes no representation,
covenant or warranty as to the condition of any such Easement Area.
SECTION 2.05. Emergency Response. The owners of the Parcels shall
individually or collectively maintain on-site personnel familiar with plant
equipment and operations whose duties shall include responding to alarms and
assisting the Fire Department or other emergency responder in accordance with
emergency response procedures to be developed with the Fire Department and other
emergency response agencies.
ARTICLE III
Term of Easements; Abandonment
SECTION 3.01. Term. Subject to the terms of Sections 3.02 and 5.03
hereof, all Easements and Non-Exclusive Rights granted herein shall be
perpetual. No Easement or Non-Exclusive Right granted herein shall expire,
terminate or be deemed abandoned without the prior written approval of the New
York City Department of Buildings and/or the New York City Department of
Business Services, as applicable, or such other Governmental Authorities
succeeding to their jurisdiction.
SECTION 3.02. Abandonment of Easements. Subject to receipt of the
prior written approval of the New York City Department of Buildings and/or the
New York City Department of Business Services, if required, the owner of a
Parcel benefitting from an Easement or Non-Exclusive Right under this
Declaration may from time to time, upon not less than thirty days' notice to the
owner of the Easement Area, release its Easement or Non-Exclusive Right with
respect thereto. Any such notice shall (x) specify the effective date of such
Release and (y) be accompanied by evidence reasonably satisfactory to the owner
of the Easement Area that such abandonment has been approved by the New York
City Department of Buildings and, to the extent necessary, the New York City
Department of Business Services. The Party benefitting from the Easement Area
shall take such measures as shall be required to effectuate the Release. Such
measures shall include the following: (i) in the case of any Easement or
Non-Exclusive Right for domestic water, to the extent necessary, the cutting,
capping, removal or disabling of any pipes, pumps, mains and other devices; (ii)
in the case of any Easement or Non-Exclusive Right for fire protection water,
the cutting, capping, removal or disabling of any pipes, pumps or mains; (iii)
in the case of any Easement for access, the erection of such wall, gate or other
barrier required to prevent any person, party or vehicle from gaining access to
the Easement Area from the benefitted Parcel; and (iv) in the case of sewer
lines, the cutting and/or capping of any pipes used to discharge sewage and
drainage water and the disabling or removal of any pipes, manholes, mains and
other devices. Whenever an Easement or Non-Exclusive Right is released in
accordance with the terms of this Section 3.02, (A) the owner of the Parcel
formerly burdened by such Easement Area shall execute and deliver to the
Releasee such documents in recordable form as shall be reasonably required to
evidence the Release, (B) the Releasor shall have no further obligation or
liability to the owner of the affected Easement Area; and (C) the Releasee shall
have no further obligation or liability to the Releasor with respect to such
Easement or Non-Exclusive Right.
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ARTICLE IV
Use, Repair and Maintenance of Easements
SECTION 4.01. Maintenance Obligation. Each Party shall, at its sole
cost and expense, with respect to each Easement Area located on or within such
Party's Parcel (i) maintain the surface and subsurface of the improved portions
of the Easement Area in good repair and condition, (ii) keep the Easement Area
reasonably free of obstructions (including snow and ice) and adequately
illuminated, (iii) maintain the security of the Easement Area, and (iv) maintain
the facilities located within such Easement Area which are necessary for the
exercise of the Non-Exclusive Rights and Easements with respect thereto
(including all pipes, mains and other devices or equipment related thereto) in
good repair and condition. As used in this Section 4.01, the term "maintain"
shall include repair and/or replacement, to the extent applicable. Each Utility
shown on the Site Plan, except for roads, shall be owned and maintained in
accordance with Schedule 4.01 attached hereto and made a part hereof. Roads
shall be owned and maintained by the Party on whose Parcel the road is located.
SECTION 4.02. Failure to Maintain. If a Party (the "Defaulting
Party") fails to perform any obligation set forth herein, the other Party (the
"Curing Party") shall have the right to perform the actions which the Defaulting
Party failed to perform in accordance with this Declaration (the "Self-Help
Rights") and shall be entitled to Entry Rights and Reimbursement Rights with
respect thereto. Notwithstanding the foregoing, Self-Help Rights may only be
exercised after failure of the Defaulting Party to perform any actions required
to be performed pursuant to this Declaration (i) if no emergency exists, within
thirty days after notice from the Curing Party, or if such failure is not
curable within said period, within such longer period as is reasonably necessary
to cure such failure, provided the Defaulting Party begins to cure such failure
within such thirty-day period and thereafter diligently prosecutes the same to
completion; and (ii) in any emergency situation, immediately upon written or
(notwithstanding any other provisions of this Declaration) verbal notice, if
prior notice is practicable, or, if such notice is not practicable, then without
giving prior notice to the Defaulting Party, provided that the Curing Party
shall, in such circumstances, give the Defaulting Party notice thereof as soon
thereafter as practicable. All work to be performed by the Curing Party so
acting under the provisions of this Declaration shall be performed in accordance
with Section 4.07.
SECTION 4.03. Use of Easement Area During Maintenance. During the
performance of any maintenance work required or permitted hereunder, each Party
shall have the right, at its own risk, to use the affected Easement Area for the
purposes contemplated herein; provided, however, that each Party shall keep such
Easement Area free of obstructions and shall implement such other safety and
similar measures as may be required by law or reasonably necessary from time to
time to assure the other Party safe and convenient access to its Parcel, and
neither Party shall materially adversely affect or substantially interfere with
the other Party's use of any such Easement Area.
SECTION 4.04. General Use Conditions. No Party shall use an Easement
or Non-Exclusive Right in accordance herewith in such a manner so as to reduce,
injure, overload, deface, harm or impair the applicable Easement Area or
Utility, so as to allow or suffer any waste thereof, or so as to commit any
nuisance by its use thereof. Any damage caused by a Party or its Permittees in
violation of this provision shall be promptly repaired by the Party that
caused, or whose Permittees caused, such damage. No Party shall materially
adversely affect, materially deprive of a benefit associated with, materially
impose a burden on, or substantially interfere with, the other Party's use of
the Utilities, Non-Exclusive Rights and/or Easements that are the subject of
this Declaration.
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SECTION 4.05. Compliance with Law. All Parties shall use the
Easement Areas and Utilities, including roads, in compliance with all applicable
licenses, permits and approvals, and otherwise in compliance with all applicable
laws (including environmental laws), ordinances, orders, codes, rules and
regulations (including all fire safety and site security requirements imposed by
law or mutually agreed to by the Parties from time to time). All Parties shall
own, operate and maintain their respective Parcels and Easements Areas in
accordance with applicable licenses, permits and approvals, and otherwise in
compliance with all applicable laws, ordinances, orders, codes, rules and
regulations of Governmental Authorities. Notwithstanding anything to the
contrary contained herein, nothing in this Declaration shall be construed to
relieve any Party of its duty under the New York City Administrative Code or
other laws and regulations to maintain in a safe condition the Utilities and
other facilities located on its property, including but not limited to fire
protection and suppression devices and equipment.
SECTION 4.06. Notification of Proposed Activity. Whenever a proposed
activity of a Party is reasonably expected to have an adverse impact on the use
by another Party of an Easement Area on such Party's Parcel, or the use of the
Utilities available therefrom, the Party proposing such activity shall notify
the other Party of such proposed activity reasonably in advance, so that the
other Party may implement reasonable measures designed to mitigate the impact
thereof. The cost of such protective measures shall be chargeable to the Party
proposing such activity. This notification requirement shall apply in all cases,
including emergencies, provided that in the case of emergency, the notice given
shall be such notice as is reasonably practicable under the circumstances.
SECTION 4.07. Performance of Work. All work to be performed under
this Declaration by a Party (the "Entering Party") in or affecting the Easement
Areas on its Parcel or the Utilities available therefrom or the Parcel of the
other Party (i) shall not impair the structural integrity of any improvement
situated on either Parcel; (ii) shall not be undertaken until the Entering Party
shall have procured and paid for all required Permits; (iii) except for routine
maintenance activity, shall not be undertaken until the Entering Party shall
have submitted to the other Party all applicable drawings, plans,
specifications, engineering plans and related information and, except in
connection with the exercise of Self-Help Rights, obtained the consent of the
other Party to the work to be performed, which consent shall not be unreasonably
withheld or delayed; (iv) shall be performed in accordance with good industry
practice and in compliance with all applicable laws, ordinances, orders, codes,
rules and regulations; (v) shall be performed by contractors fully insured,
licensed (to the extent required by applicable law) and competent to do the work
being undertaken; (vi) shall be performed in a manner that does not materially
adversely affect or substantially interfere with the use and enjoyment by the
other Party of the affected Utility, Easement Areas or Parcel, and ("vii") shall
be diligently prosecuted to completion. During any construction or
reconstruction work, the construction site shall be kept in an orderly, clean
and safe condition. The Entering Party shall pay when due all claims for labor
performed or material furnished and not permit any mechanics' or material men's
lien to attach, and if any such liens do attach, the Entering Party shall
immediately bond such liens in accordance with any applicable statutory
provision. Except in connection with the exercise of Self-Help Rights, the
Entering Party shall also be responsible for the professional fees incurred by
the other Party in reviewing the Entering Party's plans and drawings, whether or
not consent thereto shall be given. The review of, comments on, or consent to
any documents, drawings, plans, specifications or other documentation provided
by the Entering Party shall not relieve the Entering Party of, or affect in any
way, its responsibility for the correctness and adequacy of the work to be
performed. The other Party shall have no liability whatsoever with respect to
any review or non-review of or consent to any documentation submitted to it by
the Entering Party.
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SECTION 4.08. Notice of Entry. Whenever the Entering Party shall
intend to enter upon an Easement Area located upon the Parcel of another Party
to perform any work, the Entering Party shall give the affected Party (i) at
least twenty-four hours' prior written notice in the case of routine
maintenance, (ii) prior written notice in accordance with Section 4.07(iii)
hereof in the case of any more significant work or (iii) immediate verbal
notification followed by written notice in the case of any emergency.
SECTION 4.09. Relocation of Easements. The owner of any Easement
Area may elect to change the location of all or any portion of the Easement
Area, on not less than ninety days' prior written notice to the owner of the
parcel benefitted by any Easement or Non-Exclusive Right specifying the proposed
effective date of such relocation. The owner of the benefitted parcel shall have
thirty days from receipt of said notice to approve the relocation, with or
without modification, such approval to serve as evidence that any such
relocation shall not deprive the benefitted party of the practical realization
of the benefits of such Easement Area. Upon receipt of the written approval of
the benefitted party, the Owner of the Easement Area seeking the relocation
shall obtain the approval of the New York City Department of Buildings and/or
the New York City Department of Business Services, as applicable. No relocation
shall become effective unless and until such governmental approval shall have
been obtained. Any such relocation shall occur at the sole cost and expense of
the Easement Area owner. Any relocated Easement or Non-Exclusive Right shall be
subject to all of the terms, covenants and conditions of this Declaration. Upon
the relocation of any Easement Area pursuant to the terms of this Section 4.09,
the owner of the Parcel benefitted shall execute and deliver to the owner of the
Parcel formerly burdened such documents in recordable form as the owner of the
former Easement shall require to evidence the Release and/or relocation thereof.
ARTICLE V
Casualty; Condemnation
SECTION 5.01. Restoration Work. Except as set forth in Section 5.03,
if any of the facilities, equipment and systems located within an Easement
Area which provides any Utility is damaged or destroyed by fire or other
casualty ("Casualty"), the owner of the Easement Area shall commence the repair
or restoration as expeditiously as is practicable in the circumstances, and
shall diligently prosecute such repair or restoration to completion in
accordance with the standards of work and other requirements set forth in
Section 4.07. Failure of the owner of the affected Easement Area to comply with
such obligation shall give rise to Self-Help Rights (and correlative
Reimbursement Rights) and other remedies in favor of the owner of the affected
Parcel. Notwithstanding the foregoing, any infrastructure, including any
equipment or roads, exclusively for the benefit of or owned by the owner of a
Parcel, shall be repaired or restored by the owner to whom it is reserved or by
whom it is owned, as the case may be, notwithstanding its location on the other
Party's Parcel.
SECTION 5.02. Condemnation. Except as set forth in Section 5.03, in
the event that a Parcel or a portion thereof containing an Easement Area shall
be taken by any Governmental Authority in the exercise of the power of eminent
domain (each, a "Taking" with the term "Taken" construed accordingly), each
affected Easement or Non-Exclusive Right hereunder shall terminate, to the
extent affected by such Taking, as of the date the owner of the Easement Area is
divested of title, unless the instrument of Taking expressly provides otherwise,
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and the award attributable to such Taking shall, if not separately awarded to
the Parties with respect to their separate interests by the condemning
authority, be equitably allocated between the Parties, as their respective
interests may appear. The control of the condemnation proceeding shall always be
vested in the fee owner of the Easement Area being Taken. Nothing herein shall
preclude the Party affected from pursuing any claims against the condemning
authority with respect to the loss of the Easements or Non-Exclusive Rights
granted herein or the costs of relocation, and all awards with respect to such
facilities or costs shall be the exclusive property of such Party.
SECTION 5.03. Relocation of an Easement After Casualty or
Condemnation. Notwithstanding the foregoing provisions of this Article V, in the
event of a casualty or condemnation which results in the complete or substantial
destruction or unusability or relocation of any Easement or Non-Exclusive Right,
the beneficiary thereof shall, to the extent commercially practical, restore the
affected Utilities, if any, in a manner that an Easement or Non-Exclusive Right
is no longer required.
ARTICLE VI
Miscellaneous Provisions
SECTION 6.01. Force Majeure. (a) Notwithstanding anything in this
Declaration to the contrary, no Party shall have any liability or be otherwise
responsible to the other for its failure to carry out its obligations, with the
exception of any obligation to pay money, under this Declaration if and only to
the extent that it becomes impossible for either Party to so perform as a result
of any Force Majeure Event.
(b) If a Party shall rely on the occurrence of a Force Majeure Event
as a basis for being excused from performance of its obligations under this
Declaration, then the Party relying on such occurrence shall (i) provide prompt
written notice of such Force Majeure Event to the other Party(ies) giving an
estimate of its expected duration and the probable impact on the performance of
its obligations hereunder, (ii) exercise its reasonable best efforts to continue
to perform its obligations under this Declaration, (iii) expeditiously take
action to correct or cure the Force Majeure Event (provided that settlement of
strikes or any other labor dispute will be completely within the sole discretion
of the Party affected by such strike or labor dispute), (iv) exercise its
reasonable best efforts to mitigate or limit damages to the other Party and (v)
provide prompt notice to the other Party(ies) of the cessation of the Force
Majeure Event.
SECTION 6.02. Default and Remedies. In the event that a Party
defaults, breaches or otherwise fails to perform any obligation of such Party
under this Declaration, the other Party shall have the right to all remedies
available at law or in equity, including the right to injunctive relief and the
right to exercise its Self-Help Rights (and shall be entitled to correlative
Reimbursement Rights in connection therewith) without any requirement to pursue
or exhaust any other remedies available to such Party under any other agreement.
All such remedies shall be cumulative and not exclusive. A Party shall have the
right, following notice to the other Party, to take such action as it may deem
necessary or advisable, including payment of any delinquent Taxes, to prevent a
foreclosure for nonpayment of Taxes or other action by a Governmental Authority
that might affect its rights and interests hereunder and any such action shall
be deemed an exercise of Self-Help Rights (and, accordingly, give rise to
correlative Reimbursement Rights). In the event a Party is entitled to
Reimbursement Rights hereunder and same are not satisfied within thirty days
after written demand by the Party entitled to same, the unpaid
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obligations shall constitute a lien against the defaulting Party's Parcel;
provided, however, that the payment of any monetary obligations which become due
and payable by a Party after recordation of a mortgage on such Party's Parcel
granted to an independent third party regularly engaged in the business of
making mortgage loans shall be subordinate to the payment of the obligations
secured by such mortgage.
SECTION 6.03. Mortgagees' Status. Except as set forth in Section
6.02 hereof, this Declaration shall be superior to any mortgages or other
instruments evidencing security for indebtedness granted by either Party from
time to time with respect to its Parcel. Accordingly, each Party agrees to
obtain and deliver to the other Party such documents and instruments, in
recordable form, as may be reasonably necessary or requested by the other Party
to evidence and confirm the subordination of any such mortgages or other
security instruments to the provisions of this Declaration.
SECTION 6.04. Estoppel Certificate. Each Party agrees, within ten
days after written request by the other, to execute, acknowledge and deliver to
and in favor of any present or proposed lender, Mortgagee, ground lessor,
purchaser, tenant or the like of all or any part of the other Party's Parcel, an
estoppel certificate, in a form reasonably satisfactory to such lender,
Mortgagee, ground lessor, purchaser, tenant or the like, stating, among other
things: (i) whether this Declaration is in full force and effect; (ii) whether
this Declaration has been modified or amended and, if so, identifying and
describing any such modification or amendment; (iii) whether there are any sums
then due and owing under this Declaration from either Party to the other, and if
so, specifying the amount thereof and reason therefor; and (iv) whether the
Party giving such certificate knows of any default (or event which, with the
passage of time, the giving of notice, or both, would constitute a default) on
the part of the other Party, or has any outstanding claim against the other
Party arising under this Declaration and, if so, specifying the nature of such
default or claim.
SECTION 6.05. No Dedication. Nothing contained in this Declaration
shall be deemed to be a gift or dedication of any portion of either Parcel to
the general public or for any public use or purpose whatsoever, or, except as
expressly set forth herein, be deemed to create any rights or benefits in favor
of any municipality, public authority or official thereof, it being the
intention of the Parties that this Declaration be for the exclusive benefit of
the owner or owners, from time to time, of the Parcels, or any part thereof, and
those claiming under them.
SECTION 6.06. Covenants Running With Land. The benefits and burdens,
rights and obligations, Easements, Non-Exclusive Rights and restrictions created
by this Declaration shall be appurtenant to and run with and burden and be
binding upon Parcel A and Parcel B, and shall inure to the benefit of and be
binding upon Declarant and those claiming by, through, or under it. The
covenants, agreements, terms, provisions and conditions of this Declaration
shall bind and benefit the successors in interest (as owners of Parcel A and
Parcel B, respectively, whether by sale, foreclosure or otherwise) of Declarant
with the same effect as if mentioned in each instance when a Party is named or
referred to, it being understood and agreed that upon any transfer of ownership
(whether by sale, foreclosure or otherwise) of all or any part of Parcel A and
Parcel B, as the case may be, each such successor in interest shall, without the
requirement of any further documentation, thereupon and thereafter assume, and
perform and observe, any and all of the obligations of its predecessors in
interest under this Declaration with respect to such Parcel (or portion
thereof). Notwithstanding the foregoing, (a) each Party shall use reasonable
efforts to cause any such successor in interest to execute an agreement in
recordable form pursuant to which such successor in interest shall assume any
and all obligations of its predecessors in interest under this Declaration;
provided, however, that the failure to obtain any such agreement shall not
detract from the provisions of the previous sentence, and (b) no Party
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shall be released from any liability for such obligations (whether arising
before or after any such transfer of ownership) without the prior written
consent of all of the other Parties, provided that Declarant shall be released
from its liability for obligations relating to Parcel A upon its conveyance of
such Parcel as contemplated by this Declaration.
SECTION 6.07. No Merger. The acquisition by the owner from time to
time of Parcel A of any interest in and to Parcel B, or the acquisition by the
owner from time to time of Parcel B of any interest in and to Parcel A shall not
result in an impairment or extinguishment by merger of any right, Easement or
obligation granted or created hereby. No merger shall result unless and until
(a) one person or entity owns the fee title to both Parcel A and Parcel B in
their entirety and (b) written consents to such merger and termination of this
Declaration shall have been obtained (and recorded with the Office of the City
Register of Kings County) from all holders of mortgages then of record with
respect to any portion of Parcel A or Parcel B.
SECTION 6.08. Assignment; No Third Party Beneficiaries. (a) This
Declaration and all of the provisions hereof shall be binding upon and inure to
the benefit of Declarant and its successors and permitted assigns but neither
this Declaration nor any of the rights, interests or obligations hereunder shall
be assigned by any Party, including by operation of law, without the prior
written consent of the other Party(ies), except (A) to a Party acquiring all or
any part of a Parcel, or (B) to a lending institution or trustee in connection
with a pledge or granting of a security interest in all or any part of the
Parcel owned by such Party;
(b) Nothing in this Declaration is intended to confer upon any other
person except the Parties any rights or remedies hereunder or shall create any
third party beneficiary rights in any person.
SECTION 6.09. Notices. (a) Unless otherwise specified herein, all
notices and other communications hereunder shall be in writing and shall be
deemed given (as of the time of delivery or, in the case of a telecopied
communication, of confirmation) if delivered personally, telecopied (which is
confirmed) or sent by overnight courier (providing proof of delivery) to the
Parties at the following addresses (or at such other address for a Party as
shall be specified by like notice)
if to Declarant, to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Attention: Director of Real Estate
With a copy to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Attention: General Counsel
(b) In the event any Party shall desire or shall be required to send
any notice to the Department of Buildings and/or to the Department of Business
Services, any such notice shall be sent in the manner described in Section
6.09(a) above addressed as follows:
if to the Department of Buildings, to:
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New York City Department of Buildings
Office of General Counsel
60 Hudson Street
New York, New York 10013, or at its then official address
if to the Department of Business Services, to:
New York City Department of Business Services
Office of General Counsel
110 William Street
New York, New York 10038, or at its then official address.
SECTION 6.10. Extension; Waiver. Any Party may (i) extend the time
for the performance of any of the obligations or other acts of the other
Party(ies) or (ii) waive compliance by the other Party(ies) with any of the
agreements or conditions contained in this Declaration. Any agreement on the
part of a Party to any such extension or waiver shall be valid only if set forth
in an instrument in writing signed on behalf of such Party. The failure of a
Party to this Declaration to assert any of its rights under this Declaration or
otherwise shall not constitute a waiver of such rights.
SECTION 6.11. Amendment and Modification. This Declaration may be
amended, modified or supplemented only by an instrument in writing signed on
behalf of each of the Parties; provided, however, that no such amendment (other
than an amendment of Section 2.03 hereof) shall be effective without the prior
written approval of the New York City Department of Buildings or the New York
City Department of Business Services, as applicable.
SECTION 6.12. Governing Law. This Declaration shall be governed by
and construed in accordance with the laws of the State of New York (regardless
of the laws that might otherwise govern under applicable principles of conflicts
of law).
SECTION 6.13. Interpretation. When a reference is made in this
Declaration to an Article, Section, Schedule or Exhibit, such reference shall be
to an Article or Section of, or Schedule or Exhibit to, this Declaration unless
otherwise indicated. The table of contents and headings contained in this
Declaration are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Declaration. Whenever the words "include",
"includes" or "including" are used in this Declaration, they shall be deemed to
be followed by the words "without limitation". The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Declaration shall
refer to this Declaration as a whole and not to any particular provision of
this Declaration. All terms defined in this Declaration shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein. The definitions contained in
this Declaration are applicable to the singular as well as the plural forms of
such terms and to the masculine as well as to the feminine and neuter genders of
such term. Any agreement, instrument, statute, regulation, rule or order defined
or referred to herein or in any agreement or instrument that is referred to
herein means such agreement, instrument, statute, regulation, rule or order as
from time to time amended, modified or supplemented, including (in the case of
agreements or instruments) by waiver or consent and (in the case of statutes,
regulations, rules or orders) by succession of comparable successor statutes,
regulations, rules or orders and references to all attachments thereto and
instruments incorporated therein. References to a person are also to its
permitted successors and assigns.
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SECTION 6.14. Jurisdiction and Enforcement. (a) Each of the Parties
irrevocably submits to the exclusive jurisdiction of (i) the Supreme Court of
the State of New York, New York County and (ii) the United States District Court
for the Southern District of New York, for the purposes of any suit, action or
other proceeding arising out of this Declaration or any transaction contemplated
hereby. Each of the Parties agrees to commence any action, suit or proceeding
relating hereto either in the United States District Court for the Southern
District of New York or, if such suit, action or proceeding may not be brought
in such court for jurisdictional reasons, in the Supreme Court of the State of
New York, New York County. Each of the Parties further agrees that service of
process, summons, notice or document by hand delivery or U.S. registered mail at
the address specified for such Party in Section 6.09 (or such other address
specified by such Party from time to time pursuant to Section 6.09) shall be
effective service of process for any action, suit or proceeding brought against
such Party in any such court. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Declaration or the transactions contemplated
hereby in (i) the Supreme Court of the State of New York, New York County, or
(ii) the United States District Court for the Southern District of New York, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
(b) The parties agree that irreparable damage would occur in the
event that any of the provisions of this Declaration were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the Parties shall be entitled to an injunction or
injunctions to prevent breaches of this Declaration and to enforce specifically
the terms and provisions of this Declaration, this being in addition to any
other remedy to which they are entitled at law or in equity.
SECTION 6.15. Severability. If any term or other provision of this
Declaration is invalid, illegal or incapable of being enforced by any rule of
law or public policy, all other conditions and provisions of this Declaration
shall nevertheless remain in full force and effect. Upon such determination that
any term or other provision is invalid, illegal or incapable of being enforced,
the Parties shall negotiate in good faith to modify this Declaration so as to
effect the original intent of the Parties as closely as possible to the fullest
extent permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
SECTION 6.16. Property Treated as Single Zoning Lot. Declarant
agrees that no breach by any Party shall have any effect on the treatment of
the Property covered by this Declaration as one zoning lot and the Property
shall be treated as one zoning lot unless such
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zoning lot is subdivided in accordance with the provisions of the Zoning
Resolution.
IN WITNESS WHEREOF, Declarant has caused this Declaration to be
signed by its duly authorized officer as of the date first above written.
CONSOLIDATED EDISON COMPANY OF
NEW YORK, INC.
By:______________________
Name:
Title:
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STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On this __ day of_______ 1999, before me personally appeared ____________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity, and that by his
signature on the instrument, the individual, or the corporation upon behalf of
which the individual acted, executed the instrument.
_____________________
NOTARY PUBLIC
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EXHIBIT A
Legal Description of Parcel A
To be prepared by GEOD Corporation, prior to the recording of this Agreement,
which description shall be substantially in accordance with Parcel A as shown on
the Gowanus Gas Turbine Site ALTA/ACSM Land Title Survey Conveyance Plan dated
February 23, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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274
EXHIBIT B
Legal Description of Parcel B
To be prepared by GEOD Corporation, prior to the recording of this Agreement,
which description shall be substantially in accordance with Parcel B as shown on
the Gowanus Gas Turbine Site ALTA/ACSM Land Title Survey Conveyance Plan dated
February 23, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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275
EXHIBIT C
Site Plan
The Gowanus Gas Turbine Site ALTA/ACSM Land Title Survey Conveyance Plan dated
February 23, 1999, as may be hereafter revised, prepared by GEOD Corporation.
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Schedule 4.01
Ownership Rights and Maintenance Obligations of Parcel Owners
Ownership Rights and Maintenance Obligations of Parcel A Owner
Domestic Water / Fire Protection Water
1. The owner of Parcel A owns and is responsible for the 10-inch line which
supplies Parcel A. The line begins at the New York City main on 25th
Street (if extended) and crosses Parcel B. The owner of Parcel A will
assume all maintenance obligations associated with this line from the
point at which ownership currently passes from New York City to Con
Edison.
Sanitary sewer
1. The owner of Parcel A owns and is responsible for the 6-inch forced
sanitary main up to but not including the "T" tap joint to the spur line
into the Gowanus Substation control room.
Ownership Rights and Maintenance Obligations of Parcel B Owner
Sanitary Sewer
1. At the "T" tap joint to the spur line into the Gowanus Substation control
room, ownership and maintenance obligations transfer to the owner of
Parcel B. The owner of Parcel B will own the 6-inch spur from the control
room and the remainder of the 6-inch line across Parcel B up until it ties
in with the New York City main on 3rd Avenue.
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EXHIBIT K
GUARANTEE AGREEMENT dated as of March 2, 1999,
between ORION POWER HOLDINGS, INC., a Delaware
corporation ("Guarantor"), and CONSOLIDATED EDISON
COMPANY OF NEW YORK, INC., a New York corporation (the
"Seller" and, collectively with Guarantor, the "Parties")
WHEREAS Buyer (as defined below) and Seller have entered into a
Generating Plant and Gas Turbine Asset Purchase and Sale Agreement dated as of
even date herewith (the "Sale Agreement"), pursuant to which Buyer has agreed to
purchase and Seller has agreed to sell certain electric generating assets, as
more particularly set forth therein, and each of Buyer and Seller undertook
certain duties, responsibilities and obligations as set forth in the Sale
Agreement and the Ancillary Agreements (as defined in the Sale Agreement);
WHEREAS Guarantor has agreed to guarantee payment and performance of
Buyer's covenants, agreements, obligations, liabilities, representations and
warranties under the Sale Agreement, any Ancillary Agreement or any other
agreement or instrument related thereto; and
WHEREAS Guarantor will benefit from the transactions contemplated by
the Sale Agreement.
NOW, THEREFORE, the Parties agree as follows:
SECTION 1. Definitions. Capitalized terms used herein shall have the
meanings assigned to them herein or, if not defined herein, then such terms
shall have the meanings assigned to them in the Sale Agreement. For the purpose
of this Agreement, "Buyer" shall mean Astoria Generating Company, L.P., a
Delaware limited partnership, and any successors and assigns under the Sale
Agreement or any Ancillary Agreement.
SECTION 2. Guarantee. Guarantor absolutely, irrevocably and
unconditionally guarantees, as a primary obligor and not merely as a surety, (a)
the due and punctual payment of (i) each payment required to be made by Buyer
under the Sale Agreement or any Ancillary Agreement, when and as due, including
payments in respect of reimbursement of disbursements and interest thereon and
(ii) all other monetary obligations, including indemnities, fees, costs and
expenses, whether primary, secondary, direct, contingent,
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fixed or otherwise (including monetary obligations incurred during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), of Buyer under
the Sale Agreement, any Ancillary Agreement or any other agreement or instrument
related thereto (all such obligations referred to in the clause (a) being
collectively referred to as the "Monetary Obligations") and (b) the due and
punctual performance and observance of, and compliance with, all covenants,
agreements, obligations, liabilities, representations and warranties of Buyer
under or pursuant to the Sale Agreement, any Ancillary Agreement or any other
agreement or instrument related thereto (all such obligations referred to in the
preceding clauses (a) and (b) being collectively referred to as the
"Obligations") . Guarantor further agrees that the Obligations may be extended,
amended, modified or renewed, in whole or in part, without notice to or further
assent from it, and that it will remain bound upon its guarantee notwithstanding
any extension, amendment, modification or renewal of any Obligation.
SECTION 3. Obligations Not Waived. To the fullest extent permitted
by applicable law, Guarantor waives presentment to, demand of payment from and
protest to Buyer of any of the Obligations, and also waives notice of acceptance
of its guarantee and notice of protest for nonpayment. To the fullest extent
permitted by applicable law, the obligations of Guarantor hereunder shall not be
affected by (a) the failure of Seller to assert any claim or demand or to
enforce or exercise any right or remedy against Buyer in respect of the
Obligations or otherwise under the provisions of the Sale Agreement, any
Ancillary Agreement or otherwise or, in each case, any delay in connection
therewith, or (b) any rescission, waiver, amendment or modification of, or any
release from any of the terms or provisions of, this Agreement, the Sale
Agreement, any Ancillary Agreement or any other agreement.
SECTION 4. Continuing Guarantee of Payment and Performance.
Guarantor further agrees that its guarantee constitutes a continuing guarantee
of payment and performance when due and not of collection, and waives any right
to require that any resort be had by Seller to any security.
SECTION 5. No Discharge or Diminishment of Guarantee. (a) The
obligations of Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination, or be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever, or otherwise be affected,
for any reason (other than the performance in full of all Obligations, including
the
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indefeasible payment in full in cash of all Monetary Obligations, and the
termination of all the Obligations), including:
(i) any claim of waiver, release, surrender, alteration or
compromise or any of the Obligations;
(ii) the invalidity, illegality or unenforceability of the
Obligations;
(iii) the occurrence or continuance of any event of bankruptcy,
reorganization, insolvency, receivership or other similar proceeding with
respect to Buyer or any other person (for purposes hereof, "person" means
any individual, partnership, limited liability company, joint venture,
corporation, trust, unincorporated organization or Governmental
Authority), or the dissolution, liquidation or winding up of Buyer or any
other person;
(iv) any permitted assignment or other transfer of this Agreement by
Seller or any permitted assignment or other transfer of the Sale Agreement
or any Ancillary Agreement in whole or in part;
(v) any sale, transfer or other disposition by Guarantor of any
direct or indirect interest it may have in Buyer or any other change in
ownership or control of Buyer; or
(vi) the absence of any notice to, or knowledge on behalf of,
Guarantor of the existence or occurrence of any of the matters or events
set forth in the foregoing clauses.
(b) Without limiting the generality of the foregoing, the
obligations of Guarantor hereunder shall not be discharged or impaired or
otherwise affected by the failure of Seller to assert any claim or demand or to
enforce any remedy under the Sale Agreement, any Ancillary Agreement or any
other agreement, by any waiver or modification of any provision thereof, by any
default, failure or delay, wilful or otherwise, in the performance of the
Obligations, or by any other act or omission that may or might in any manner or
to any extent vary the risk of Guarantor or that would otherwise operate as a
discharge of Guarantor as a matter of law or equity (other than the performance
in full of all Obligations, including the indefeasible payment in full in cash
of all Monetary Obligations, and the termination of all the Obligations).
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SECTION 6. Defenses of Buyer Waived. To the fullest extent permitted
by applicable law, Guarantor waives any defense based on or arising out of any
defense of Buyer or the unenforceability of the Obligations or any part thereof
from any cause, or the cessation from any cause of the liability of Buyer (other
than the performance in full (of all Obligations, including the indefeasible
payment in full in cash of all Monetary Obligations, and the termination of all
the Obligations). Seller may compromise or adjust any part of the Obligations,
make any other accommodation with Buyer or exercise any other right or remedy
available to it against Buyer, without affecting or impairing in any way the
liability of Guarantor hereunder except to the extent all the Obligations have
been fully and finally performed, including the indefeasible payment in full of
all Monetary Obligations, and terminated. To the fullest extent permitted by
applicable law, Guarantor waives any defense arising out of any such election
even though such election operates, pursuant to applicable law, to impair or to
extinguish any right of reimbursement or subrogation or other right or remedy of
Guarantor against Buyer or any security.
SECTION 7. Representations and Warranties of Guarantor. Guarantor
represents and warrants to Seller as follows:
(a) Organization. Guarantor is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as is now being conducted. Guarantor
is duly qualified and licensed to do business as a foreign corporation and is in
good standing in the State of New York.
(b) Authority Relative to this Agreement. Guarantor has all
necessary corporate power and authority to execute and deliver this Agreement
and to perform its obligations hereunder. The execution and delivery by
Guarantor of this Agreement and performance by Guarantor of its obligations
hereunder have been duly and validly authorized by the Board of Directors of
Guarantor and no other corporate proceedings on the part of Guarantor are
necessary to authorize this Agreement or performance by Guarantor of its
obligations hereunder. This Agreement has been duly and validly executed and
delivered by Guarantor and this Agreement constitutes a valid and binding
agreement of Guarantor, enforceable against Guarantor in accordance with its
terms.
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(c) Consents and Approvals; No Violation. (i) Subject to obtaining
Guarantor Required Regulatory Approvals, neither the execution and delivery of
this Agreement by Guarantor nor performance by Guarantor of its obligations
hereunder will (i) conflict with or result in any breach of any provision of the
Certificate of Incorporation or By-laws (or other similar governing documents)
of Guarantor, (ii) result in a default (or give rise to any right of
termination, cancellation or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, agreement, lease or
other instrument or obligation to which Guarantor or any of its subsidiaries is
a party or by which any of their respective assets may be bound or (iii) violate
any order, writ, injunction, decree, statute, rule or regulation applicable to
Guarantor, or any of its assets, except in the case of clauses (ii) and (iii)
for such failures to obtain a necessary consent, defaults and violations which
would not, individually or in the aggregate, have a material adverse effect on
the ability of Guarantor to discharge its obligations under this Agreement (a
"Guarantor Material Adverse Effect").
(ii) No declaration, filing or registration with, or notice to, or
authorization, consent or approval of any Governmental Authority is necessary
for performance by Guarantor of its obligations hereunder, other than such
declarations, filings, registrations, notices, authorizations, consents or
approvals which, if not obtained or made would not, individually or in the
aggregate, have a Guarantor Material Adverse Effect.
SECTION 8. Agreement to Perform and Pay; Subordination. In
furtherance of the foregoing and not in limitation of any other right that
Seller has at law or in equity against Guarantor by virtue hereof, upon the
failure of Buyer to perform or pay any Obligation when and as the same shall
become due, Guarantor hereby promises to and will forthwith, as the case may be,
(a) perform, or cause to be performed, such unperformed Obligations and (b) pay,
or cause to be paid, to Seller in cash the amount of such unpaid Obligations.
Upon payment by Guarantor of any sums to Seller as provided above, all rights of
Guarantor against Buyer arising as a result thereof by way of right of
subrogation, contribution, reimbursement, indemnity or otherwise shall in all
respects be subordinate and junior in right of payment to the prior indefeasible
payment in full in cash of all the Obligations. In addition, any indebtedness of
Buyer now or hereafter held by Guarantor is hereby subordinated in right of
payment to the prior payment in full in cash of the Monetary Obligations. If any
amount
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shall erroneously be paid to Guarantor on account of (i) such subrogation,
contribution, reimbursement, indemnity or similar right or (ii) any such
indebtedness of Buyer, such amount shall be held in trust for the benefit of
Seller and shall forthwith be paid to Seller to be credited against the payment
of the Monetary Obligations or perform in (accordance with the terms of the
Sale Agreement or any Ancillary Agreement, as applicable.
SECTION 9. Information. Guarantor assumes all responsibility for
being and keeping itself informed of Buyer's financial condition and assets, and
of all other circumstances bearing upon the risk of nonperformance of the
Obligations (including the nonpayment of Monetary Obligations) and the nature,
scope and extent of the risks that Guarantor assumes and incurs hereunder, and
agrees that Seller will not have any duty to advise Guarantor of information
known to it regarding such circumstances or risks.
SECTION 10. Termination and Reinstatement. The guarantee made
hereunder (a) shall terminate when all the Obligations have been (i) performed
in full, including the indefeasible payment in full in, cash of the Monetary
Obligations and (ii) terminated and (b) shall continue to be effective or be
reinstated, as the case may be, if at any time any payment, or any part thereof,
of any Obligation is rescinded or must otherwise be restored by Seller upon the
bankruptcy or reorganization of Buyer or Guarantor or for any other reason.
SECTION 11. Assignment; No Third Party Beneficiaries. This Agreement
and all of the provisions hereunder shall be binding upon and inure to the
benefit of the Parties and their respective successors and permitted assigns,
but neither this Agreement nor any of the rights, interests and obligations
hereunder shall be assigned by Guarantor, including by operation of law, without
the prior written consent of Seller, except to an Affiliate of Guarantor in
connection with the transfer of the Auctioned Assets to an Affiliate of Buyer in
accordance with Section 12.05 (a) (ii) (A) of the Sale Agreement; provided,
however, that no assignment or transfer of rights or obligations by Guarantor
shall relieve it from the full liabilities and the full financial
responsibility, as provided for under this Agreement, unless and until the
transferee or assignee shall agree in writing to assume such obligations and
duties and Seller has consented in writing to such assumption.
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SECTION 12. Amendment and Modification; Extension; Waiver. This
Agreement may be amended, modified or supplemented only by an instrument in
writing signed on behalf of each of the Parties. Any agreement on the part of a
Party to any extension or waiver in respect of this Agreement shall be valid
only if set forth in an instrument in writing signed on behalf of such Party.
The failure of a Party to this Agreement to assert any of its rights under this
Agreement or otherwise shall not constitute a waiver of such rights.
SECTION 13. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law).
SECTION 14. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given (as of the time of delivery or, in
the case of a telecopied communication, of confirmation) if delivered
personally, telecopied (which is confirmed) or sent by overnight courier
(providing proof of delivery) to the Parties at the following addresses (or at
such other address for a Party as shall be specified by like notice):
if to Guarantor, to:
Orion Power Holdings, Inc.
111 Market Place
Suite 520
Baltimore, MD 21202
Telecopy No.: (410) 468-3699
Attention: General Counsel
with a copy on or prior to the Closing Date to:
Thelen Reid & Priest LLP
Two Embarcadero Center
Suite 2100
San Francisco, CA 94111
Telecopy No.: (415) 421-1068
Attention: Thomas B. Glascock, Esq.
if to Seller, to:
Consolidated Edison Company of New York, Inc.
4 Irving Place
New York, NY 10003
Telecopy No.: (212) 677-0601
Attention: General Counsel
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with a copy on or prior to the Closing Date to:
Cravath, Swaine & Moore
825 Eighth Avenue
New York, NY 10019
Telecopy No.: (212) 474-3700
Attention: George W. Bilicic, Jr., Esq.
SECTION 15. Jurisdiction and Enforcement. (a) Each of the Parties
irrevocably submits to the exclusive jurisdiction of (i) the Supreme Court of
the State of New York, New York County and (ii) the United States District Court
for the Southern District of New York, for the purposes of any suit, action or
other proceeding arising out of this Agreement or any transaction contemplated
hereby. Each of the Parties agrees to commence any action, suit or proceeding
relating hereto either in the United States District Court for the Southern
District of New York for, if such suit, action or proceeding may not be brought
in such court for jurisdictional reasons, in the Supreme Court of the State of
New York, New York County. Each of the Parties further agrees that service of
process, summons, notice or document by hand delivery or U.S. registered mail at
the address specified for such Party in Section 14 (or such other address
specified by such Party from time to time pursuant to Section 14) shall be
effective service of process for any action, suit or proceeding brought against
such Party in any such court. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Supreme Court of the State of New York, New York County, or
(ii) the United States District Court for the Southern District of New York, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
(b) The Parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the Parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, this being in addition to any other
remedy to which they are entitled at law or in equity.
SECTION 16. Survival of Agreement. All covenants, agreements,
representations and warranties made
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by Guarantor herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement shall be considered
to have been relied upon by Seller and shall survive the consummation of the
transactions contemplated by the Sale Agreement regardless of any investigation
made by Seller or on its behalf, and shall continue in full force and effect as
long as any Obligations remain outstanding.
SECTION 17. Effectiveness; Counterparts. This Agreement shall become
effective when executed by Guarantor and Seller. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
SECTION 18. Rules of Interpretation. The rules of interpretation
specified in Section 12.08 of the Sale Agreement shall be applicable to this
Agreement.
SECTION 19. Severability. (a) If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
(b) In the event that the provisions of this Agreement are claimed
or held to be inconsistent with any other agreement or instrument evidencing the
Obligations, the terms of this Agreement shall remain fully valid and effective.
SECTION 20. Entire Agreement. This Agreement and the Confidentiality
Agreement embody the entire agreement and understanding of the Parties in
respect of the matters contemplated hereby. There are no restrictions, promises,
representations, warranties, covenants or undertakings other than those
expressly set forth or referred to herein or therein. This Agreement supersedes
all prior agreements and understandings between the Parties with respect to the
matters contemplated hereby other than the Confidentiality Agreement.
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SECTION 21. Letter of Credit. Guarantor agrees that it shall at all
times, until the earlier of the fifth anniversary of the Closing Date and such
time as long-term debt of the Guarantor is rated by a nationally recognized
statistical rating organization (as such term is defined in the Rules under the
Securities Exchange Act of 1934, as amended) in one of its generic categories
that signifies investment grade, maintain an irrevocable letter of credit in
respect of the Obligations in favor of Seller in the amount of $10,000,000, and
that the terms and conditions of such letter of credit shall be in form and
substance reasonably satisfactory to Seller.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be signed by their respective duly authorized officers as of the date first
above written as of the day and year first above written.
ORION POWER HOLDINGS, INC.,
by ___________________________
Name:
Title:
CONSOLIDATED EDISON COMPANY OF
NEW YORK, INC.,
by ___________________________
Name:
Title:
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EXHIBIT L
FORM OF OPINION OF COUNSEL TO GUARANTOR
* , 1999
Consolidated Edison Company
of New York, Inc.
4 Irving Place
New York, NY 10003
Guarantee Agreement
Ladies and Gentlemen:
We have acted as counsel to Orion Power Holdings, Inc., a Delaware
corporation ("Guarantor"), in connection with the Guarantee Agreement (the
"Guarantee") dated as of March 2, 1999, between Guarantor and Consolidated
Edison Company of New York, Inc., a New York corporation ("Seller"). Capitalized
terms used but not defined herein have the meanings assigned to them in the
Guarantee.
In that connection, we have examined originals, or copies certified
or otherwise identified to our satisfaction, of such documents, corporate
records and other instruments as we have deemed necessary or appropriate for the
purposes of this opinion, including: (a) the Guarantee, (b) the Certificate of
Incorporation and By-laws (or other similar governing documents) of Guarantor,
(c) resolutions of the Board of Directors of Guarantor and (d) the Generating
Plant and Gas Turbine Asset Purchase and Sale Agreement dated as of March 2,
1999, between Astoria Generating Company, L.P., a Delaware limited partnership,
and Seller (the "Sale Agreement") and the Ancillary Agreements (as defined in
the Sale Agreement).
In rendering our opinion, we have assumed the due authorization,
execution and delivery of the Guarantee by Seller.
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Based upon the foregoing and subject to the qualifications
hereinafter set forth, we are of the opinion as follows:
1. Guarantor is a corporation validly existing and in good standing
under the laws of the State of Delaware. Guarantor has all necessary corporate
power and authority to execute and deliver the Guarantee and to consummate the
transactions contemplated thereby; and the execution and delivery by Guarantor
of the Guarantee and the performance by Guarantor of its obligations thereunder
have been duly and validly authorized by all necessary corporate action on the
part of Guarantor.
2. The Guarantee has been duly executed and delivered by Guarantor,
and assuming that the Guarantee constitutes a valid and binding obligation of
Seller, the Guarantee constitutes a valid and binding obligation of Guarantor,
enforceable against Guarantor in accordance with its terms (subject to
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other similar laws affecting creditors' rights generally from
time to time in effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether considered in a proceeding in equity or at law).
With respect to the foregoing opinion, the availability of a decree for specific
performance or an injunction is subject to the discretion of the court requested
to issue any such decree or injunction.
3. Neither the execution and delivery of the Guarantee nor the
performance by Guarantor of its obligations thereunder will (i) conflict with or
result in a breach of the Certificate of Incorporation or By-laws (or other
similar governing documents) of Guarantor, (ii) result in a default (or give
rise to any right of termination, cancelation or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, license,
agreement, lease or other instrument or obligation to which Guarantor or any of
its subsidiaries is a party or by which any of their respective assets may be
bound or (iii) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Guarantor, or any of its assets, except in the case of
clauses (ii) and (iii) for such failures to obtain a necessary consent, defaults
and violations which would not, individually or in the aggregate, have a
material adverse effect on the ability of Guarantor to consummate the
transactions contemplated by, and discharge its obligations under, the
Guarantee.
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4. No declaration, filing or registration with, or notice to, or
authorization, consent or approval of any Governmental Authority is necessary
for performance by Guarantor of its obligations under the Guarantee.
We express no opinion herein as to (i) the provisions of the
Guarantee insofar as such provisions relate to the subject matter jurisdiction
of the United States District Court for the Southern District of New York to
adjudicate any controversy related thereto and (ii) the waiver of an
inconvenient forum set forth in the provisions of the Guarantee.
We are furnishing this opinion to you pursuant to Section 8.03(k) of
the Sale Agreement, solely for your benefit in connection with the transactions
contemplated by the Guarantee and the Sale Agreement. This opinion may not be
relied upon by any other person or for any other purpose or used, circulated,
quoted or otherwise referred to for any other purpose.
Very truly yours,