Exhibit 10(a)57
PLANT MCINTOSH
COMBUSTION TURBINE
PURCHASE AND OWNERSHIP
PARTICIPATION AGREEMENT
between
GEORGIA POWER COMPANY
and
SAVANNAH ELECTRIC AND POWER COMPANY
Dated as of December 15, 1992
Plant McIntosh
Combustion Turbine
Purchase and Ownership Participation Agreement
Table of Contents
Page
1. DEFINITIONS 1
(a) ADDITIONAL PLANT MCINTOSH CTS 1
(b) AFFILIATE 3
(c) AGENCY FUNCTIONS 3
(d) AGENT 3
(e) ARMY CORPS OF ENGINEERS 3
(f) ASSIGNMENT OF CT PURCHASE AGREEMENT 3
(g) BUSINESS DAY 3
(h) CAPITAL ACCOUNT 4
(i) CAPITAL BUDGET 4
(j) CLOSING 4
(k) COLLATERAL DOCUMENTS 4
(l) COMMERCIAL OPERATION 4
(m) CONSTRUCTION ACCOUNT 4
(n) CONSTRUCTION BUDGET 5
(o) COST OF CONSTRUCTION 5
(p) CT COMMON FACILITIES 6
(q) CT COMMON FACILITIES SITE 7
(r) CT FUEL SUPPLY 7
(s) DUE DILIGENCE 7
(t) EXECUTION AND DELIVERY 7
(u) FERC 7
(v) FORCE MAJEURE EVENT 7
(w) FUEL COSTS 8
(x) FUEL OIL TANK 8
(y) GEPD 8
(z) GOVERNMENTAL AUTHORITY 8
(aa) GPC PLANT MCINTOSH CTS 9
(ab) GPC PLANT MCINTOSH CTS SITE 9
(ac) GPSC 9
(ad) INDENTURE 9
(ae) LEASE 9
(af) LEGAL REQUIREMENTS 9
(ag) OPERATING ACCOUNT 10
(ah) OPERATING AGREEMENT 10
(ai) OPERATING BUDGET 10
(aj) OPERATING COSTS 10
(ak) PARTICIPANTS 10
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(al) PARTY 10
(am) PLANT MCINTOSH 10
(an) PLANT MCINTOSH CT NOS. 01 AND 02 11
(ao) PLANT MCINTOSH CT NOS. 03 AND 04 12
(ap) PLANT MCINTOSH CT NOS. 05 AND 06 14
(aq) PLANT MCINTOSH CT NOS. 07 AND 08 15
(ar) PLANT MCINTOSH CT PROJECT 17
(as) PLANT MCINTOSH CTS 17
(at) PLANT MCINTOSH CTS SITE 17
(au) 1994 PLANT MCINTOSH CTS 17
(av) 1995 PLANT MCINTOSH CTS 17
(aw) PLANT MCINTOSH SITE 17
(ax) PRIME RATE 17
(ay) PRO FORMA OWNERSHIP INTEREST 18
(az) PROJECT MANAGEMENT BOARD 18
(ba) PRUDENT UTILITY PRACTICE 18
(bb) PURCHASE PRICE 19
(bc) RELEASE 19
(bd) RENT 19
(be) SAVANNAH PLANT MCINTOSH CTS 19
(bf) SAVANNAH PLANT MCINTOSH CTS SITE. 19
(bg) SCSI 19
(bh) SEC 20
(bi) SITE REPRESENTATIVE 20
(bj) THE SOUTHERN COMPANY 20
(bk) UNIFORM SYSTEM OF ACCOUNTS 20
2. REPRESENTATIONS AND WARRANTIES 20
(a) GPC REPRESENTATIONS AND WARRANTIES 20
(i) Organization and Existence 20
(ii) Due Authorization 20
(iii) Litigation 21
(iv) No Material Violation, No Material
Impairment. 21
(v) Approvals 22
(b) SAVANNAH REPRESENTATIONS AND WARRANTIES 22
(i) Organization and Existence 22
(ii) Due Authorization 22
(iii) Litigation 23
(iv) No Material Violation, No Material
Impairment 23
(v) Approvals 24
3. SALE TO GPC OF AN UNDIVIDED OWNERSHIP INTEREST IN
CERTAIN OF THE CT COMMON FACILITIES EQUIPMENT 24
(a) SALE OF ASSETS 24
(b) PURCHASE PRICE AND PAYMENT 24
(c) CLOSING 25
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4. LEASE TO GPC OF THE GPC PLANT MCINTOSH CTS SITE AND THE
CT COMMON FACILITIES SITE 26
(a) LEASE OF LAND 26
(b) RENT AND PAYMENT 27
(c) EXECUTION AND DELIVERY 27
(d) AMENDMENT OF LEASE IN CONNECTION WITH THE
CONSTRUCTION OF ONE OR MORE ADDITIONAL PLANT
MCINTOSH CTS 28
5. AGENCY 29
(a) APPOINTMENT 29
(b) AUTHORITY AND RESPONSIBILITY 29
(c) LIABILITY, REMEDIES AND LIMITATIONS OF LIABILITY 31
(d) MANAGEMENT AND CONSTRUCTION AUDITS 33
(e) ON-SITE OBSERVATION AND INSPECTION 33
(f) INDEMNIFICATION 34
(g) AVAILABILITY OF RECORDS 34
(h) RIGHT TO COPIES 34
(i) PLANT TOURS 35
(j) BILLING AND ACCOUNTING 35
(k) PLANT MCINTOSH CT PROJECT MANAGEMENT BOARD 35
(l) RECORD KEEPING 35
6. OWNERSHIP, RIGHTS AND OBLIGATIONS 36
(a) OWNERSHIP 36
(b) NONPAYMENT 37
(c) ALIENATION AND ASSIGNMENT 39
(d) DAMAGE OR DESTRUCTION 43
(e) TAXES 44
(f) INSURANCE 45
(g) RESERVED 46
(h) POLLUTION CONTROL AND OTHER FACILITIES 46
(i) NO IMPUTATION OF KNOWLEDGE 46
(j) CONSTRUCTION BUDGETS AND SCHEDULES 47
(k) PAYMENTS MADE DURING CONSTRUCTION 48
(l) CONSTRUCTION ACCOUNT 52
(m) SHARING OF COSTS - GENERAL 54
7. CERTAIN ADDITIONAL AGREEMENTS AMONG THE PARTICIPANTS 55
(a) NO ADVERSE DISTINCTION 55
(b) COOPERATION 55
(c) APPROVALS 55
(d) COMPLIANCE WITH LAWS AND ENVIRONMENTAL MATTERS 55
(e) SAFETY 56
(f) EQUAL EMPLOYMENT OPPORTUNITY AND CIVIL RIGHTS 57
8. CONDITIONS PRECEDENT TO EXECUTION AND DELIVERY 57
(a) SAVANNAH'S CONDITIONS 57
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(i) Representations and Warranties Correct;
Performance by GPC 57
(ii) Litigation Certificate 58
(iii) Other Documents 58
(iv) Opinion of GPC's Counsel 58
(b) GPC'S CONDITIONS 59
(i) Representations and Warranties Correct;
Performance by Savannah 59
(ii) Litigation Certificate 59
(iii) Collateral Documents 60
(iv) Title Insurance 60
(v) No Material Change 60
(vi) Opinion of Savannah's Counsel 60
(vii) Due Diligence Satisfactory 61
(c) MUTUAL CONDITIONS 61
9. CONDITIONS PRECEDENT TO CLOSING 62
(a) SAVANNAH'S CONDITIONS 62
(i) Representations and Warranties Correct;
Performance by GPC 62
(ii) Litigation Certificate 62
(iii) Other Documents 63
(iv) Opinion of GPC's Counsel 63
(b) GPC'S CONDITIONS 64
(i) Representations and Warranties Correct;
Performance by Savannah 64
(ii) Litigation Certificate 64
(iii) Collateral Documents 64
(iv) No Material Change 65
(v) Opinion of Savannah's Counsel 65
(vi) Due Diligence Satisfactory 66
(c) MUTUAL CONDITIONS 66
10. MISCELLANEOUS 66
(a) SURVIVAL 66
(b) FURTHER ASSURANCES 67
(c) GOVERNING LAW 67
(d) NOTICE 67
(e) SECTION HEADINGS NOT TO AFFECT MEANING 68
(f) NO PARTNERSHIP 68
(g) TIME OF ESSENCE 68
(h) AMENDMENTS 68
(i) SUCCESSORS AND ASSIGNS 68
(j) COUNTERPARTS 68
(k) "AS IS" SALE 68
(l) COMPUTATION OF PERCENTAGE UNDIVIDED OWNERSHIP
INTEREST 69
(m) SUCCESSOR AGENT 69
(n) THE PLANT MCINTOSH CT UNITS 70
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(o) INSPECTION PRIOR TO EXECUTION AND DELIVERY AND
PRIOR TO CLOSING 70
(p) CONTINUING DUE DILIGENCE 70
(q) SEVERAL AGREEMENTS 71
(r) SPECIAL PROVISIONS RELATING TO THE CT COMMON
FACILITIES 71
(s) CONSTRUCTION OF "INCLUDING" 71
(t) NO DELAY 71
(u) OBLIGATION TO CONVEY INTERESTS IN THE CT COMMON
FACILITIES 72
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Exhibits
A Description of land for Plant McIntosh CTs
A1/2 Drawing depicting approximate location of land for
Plant McIntosh CT Nos. 01 and 02
A3/4 Drawing depicting approximate location of land for
Plant McIntosh CT Nos. 03 and 04
A5/6 Drawing depicting approximate location of land for
Plant McIntosh CT Nos. 05 and 06
A7/8 Drawing depicting approximate location of land for
Plant McIntosh CT Nos. 07 and 08
A9-16 Drawing depicting approximate location of land for
Additional Plant McIntosh CTs
B Drawing depicting approximate location of land constituting
the CT Common Facilities Site
C DELETED
D Form of bill of sale for sale to GPC of undivided ownership
interest in certain of the CT Common Facilities
E Form of lease for conveyance to GPC of leasehold interests
in the GPC Plant McIntosh CTs Site and the CT Common
Facilities Site
F Description of land constituting the Plant McIntosh Site
G Schedule of Permitted Exceptions
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THIS PLANT MCINTOSH COMBUSTION TURBINE PURCHASE AND
OWNERSHIP PARTICIPATION AGREEMENT (the "Agreement"), dated as of
December 15, 1992, is between GEORGIA POWER COMPANY, a
corporation organized and existing under the laws of the State of
Georgia ("GPC"), and SAVANNAH ELECTRIC AND POWER COMPANY, a
corporation organized and existing under the laws of the State of
Georgia ("Savannah").
W I T N E S S E T H:
A. GPC and Savannah desire and intend to establish their
respective ownership rights in the Plant McIntosh CTs, in the CT
Common Facilities and in the CT Fuel Supply on and subject to the
terms and provisions hereof and by an Operating Agreement, dated
as of the date hereof between GPC and Savannah pertaining to the
Plant McIntosh CTs, the CT Common Facilities and the CT Fuel
Supply, to provide for the planning, licensing, design,
procurement, construction, acquisition, completion, testing,
startup, management, control, operation, maintenance, renewal,
addition, replacement, modification and disposal of the Plant
McIntosh CTs, the CT Common Facilities and the CT Fuel Supply and
for the entitlement and use of capacity and energy from the Plant
McIntosh CTs and the sharing of the costs thereof and of the CT
Common Facilities and the CT Fuel Supply.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, GPC and Savannah hereby agree
as follows:
1. DEFINITIONS. In addition to the terms defined elsewhere in
this Agreement, the following terms have the meanings indicated
which meanings shall be equally applicable to both singular and
plural forms of such terms except when otherwise expressly
provided:
(a) ADDITIONAL PLANT MCINTOSH CTS. The "Additional Plant
McIntosh CTs" shall consist of:
(i) That certain real property upon which may be
constructed and located one or more of eight (8) complete
combustion turbine-generator units to be known as the
Additional Plant McIntosh CTs, the exact legal description
for which land shall be determined upon completion of such
construction, and which shall comprise a parcel of land
approximately 800 feet by 300 feet, and which parcel is
approximately shown as crosshatched and labeled as the
"Additional CTs Parcel" on Exhibit A9-16 hereof and
incorporated herein (which parcel shall be reduced, as
necessary, to suit the actual number of individual
Additional Plant McIntosh CTs constructed), together with
all such additional land, appurtenant easements or other
rights therein as may hereafter be acquired for the purposes
specified in subsection (iii) of this Section 1(a). GPC and
Savannah agree that the exact legal description for the
aforedescribed parcel of land shall be substituted for
Exhibit A9-16 hereof upon completion of the survey of such
parcel of land and the approval of such survey by GPC, and
such legal description shall become a part hereof
automatically upon such substitution;
(ii) All personal property comprising the combustion
turbine-generator units to be known as the Additional Plant
McIntosh CTs, including, without limitation, eight complete
combustion turbine-generator units, the enclosures housing
the same and the main step-up transformers which are to be
used solely in connection with the Additional Plant McIntosh
CTs, all as the foregoing list of personal property may be
modified or supplemented at the closing;
(iii) Such additional land, easements or other rights
therein as may be acquired, and such additional facilities
and other tangible property as may be acquired, constructed,
installed or replaced solely in connection with the
Additional Plant McIntosh CTs or any one or more of them;
provided that (A) the cost of such additional land,
easements or other rights therein or of such additional
facilities or other tangible property shall be properly
recordable in accordance with the Uniform System of
Accounts, (B) such additional land, easements or other
rights therein or such additional facilities or other
tangible property shall have been acquired, constructed,
installed or replaced for the use of the Participants having
an ownership interest in the personal property comprising
the Additional Plant McIntosh CTs under and subject to the
provisions of this Agreement, and (C) the acquisition of
such additional land, easements or other rights therein or
the acquisition, construction, installation or replacement
of such additional facilities or other tangible property
shall (1) be necessary in order to keep the Additional Plant
McIntosh CTs (or any one or more of them) in good operating
condition or to satisfy the requirements of any Governmental
Authority having jurisdiction over the Additional Plant
McIntosh CTs, or (2) be agreed to by the Participants having
an ownership interest in the personal property comprising
the Additional Plant McIntosh CTs; and
(iv) Existing intangible property rights, and such
additional intangible property rights as may be hereafter
acquired, associated with the planning, licensing, design,
construction, acquisition, completion, testing, startup,
management, control, operation, maintenance, renewal,
addition, replacement, modification and disposal of any of
the items in this Section 1(a).
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(b) AFFILIATE. An "Affiliate" of a Participant shall mean
any corporation, partnership (limited or general) or other person
or entity controlling, under common control with, or controlled
by such Participant.
(c) AGENCY FUNCTIONS. The "Agency Functions" shall mean
those activities which the Agent shall undertake on behalf of the
Participants which relate to the planning, design, licensing,
procurement, acquisition (other than acquisition by GPC of a
leasehold interest in the GPC Plant McIntosh CTs Site and the CT
Common Facilities Site and of an undivided ownership interest in
certain of the CT Common Facilities equipment pursuant to this
Agreement), construction, completion, testing, startup,
management, control, operation, maintenance, renewal, addition,
replacement, modification and disposal of the Plant McIntosh CTs,
the CT Common Facilities and the CT Fuel Supply, as the case may
be, under this Agreement, and the Operating Agreement.
(d) AGENT. "Agent" shall mean Savannah or its successors
with respect to its rights and obligations in the performance of
the Agency Functions on behalf of the Participants with respect
to the Plant McIntosh CTs, the CT Common Facilities and the CT
Fuel Supply. The term "Agent" shall also mean and refer to
Savannah (or its successor as Agent) acting on its own behalf
with respect to the Savannah Plant McIntosh CTs, the CT Common
Facilities and the CT Fuel Supply for so long as Savannah (or its
successor as Agent) owns an undivided ownership interest in the
Savannah Plant McIntosh CTs, the CT Common Facilities, and the CT
Fuel Supply, respectively.
(e) ARMY CORPS OF ENGINEERS. The "Army Corps of
Engineers" shall refer to the United States Army Corps of
Engineers, a subdivision of the United States Department of
Defense, or any entity succeeding to the powers and functions
thereof.
(f) ASSIGNMENT OF CT PURCHASE AGREEMENT. The "Assignment
of CT Purchase Agreement" shall refer to that certain Assignment
of Contract between SCSI and Savannah dated April 22, 1992 under
which SCSI assigned to Savannah that certain Agreement for the
Purchase and Sale of Combustion Turbine Generators and
Auxiliaries between ABB Energy Services, Inc. and SCSI dated as
of January 31, 1991, as amended by that certain Amendment Number
One, dated as of April 22, 1992.
(g) BUSINESS DAY. A "Business Day" shall be any Monday,
Tuesday, Wednesday, Thursday or Friday other than a day which has
been established by law or required by executive order as a
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holiday for any commercial banking institution in the State of
Georgia.
(h) CAPITAL ACCOUNT. The "Capital Account" shall refer to
the separate, interest bearing account or accounts, in a bank or
banks, the deposits in which are insured, subject to applicable
limits, by the Federal Deposit Insurance Corporation and which
meets or meet all applicable requirements imposed upon
depositories of Savannah, established by Savannah as Agent,
pursuant to the terms of the Operating Agreement, for the payment
of additional Cost of Construction and Fuel Costs.
(i) CAPITAL BUDGET. The "Capital Budget" shall refer to
the budgets pertaining to additional Cost of Construction and
Fuel Costs for that portion of the Plant McIntosh CT Project
which has achieved Commercial Operation to be delivered to the
Participants pursuant to the terms of Section 2(c), DEVELOPMENT
OF BUDGETS, PLANS AND SCHEDULES, of the Operating Agreement.
(j) CLOSING. The "Closing" shall have the meaning
assigned in Section 3(c), CLOSING, hereof.
(k) COLLATERAL DOCUMENTS. The "Collateral Documents"
shall refer to the Operating Agreement and the Assignment of the
CT Purchase Agreement, collectively.
(l) COMMERCIAL OPERATION. "Commercial Operation" shall
refer to the date or dates when any of the Plant McIntosh CTs are
completed and declared fully operable by Savannah, as Agent for
the Participants with respect to construction; provided, however,
that none of the Additional Plant McIntosh CTs shall be included
in the Plant McIntosh CTs until such time as one or more
Participants provide written notice to the other Participants
that they are planning to construct one or more of the Additional
Plant McIntosh CTs, as the case may be, in order to serve such
Participants' energy needs. It is the intent of the Parties that
Plant McIntosh CT Nos. 07 and 08 achieve Commercial Operation on
January 24, 1994 (unit No. 08) and February 28, 1994 (unit No.
07), that Plant McIntosh CT Nos. 05 and 06 achieve Commercial
Operation on March 9, 1994 (unit No. 06) and April 7, 1994 (unit
No. 05), that Plant McIntosh CT Nos. 03 and 04 achieve Commercial
Operation on May 5, 1994 (unit No. 04) and June 3, 1994 (unit No.
03), and that Plant McIntosh CT Nos. 01 and 02 achieve Commercial
Operation on April 13, 1995 (unit No. 02) and May 26, 1995 (unit
No. 01).
(m) CONSTRUCTION ACCOUNT. The "Construction Account"
shall refer to the separate, interest bearing account or
accounts, in a bank or banks, the deposits in which are insured,
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subject to applicable limits, by the Federal Deposit Insurance
Corporation and which meets or meet all applicable requirements
imposed upon depositories of Savannah, established by Savannah as
Agent, pursuant to the terms of this Agreement, for the payment
of Cost of Construction.
(n) CONSTRUCTION BUDGET. The "Construction Budget" shall
refer to the budgets pertaining to the Cost of Construction to be
delivered to the Participants pursuant to the terms of
Section 6(j), CONSTRUCTION BUDGETS AND SCHEDULES, hereof.
(o) COST OF CONSTRUCTION. The "Cost of Construction"
shall refer to all costs incurred by Savannah, as Agent, for the
Participants in connection with the planning, design, licensing,
procurement, acquisition, construction, completion, testing,
startup, renewal, addition, modification, replacement or disposal
of the Plant McIntosh CTs and the CT Common Facilities, or any
portion thereof, including, without limitation, that portion of
administrative and general expenses incurred by Savannah, as
Agent, which is properly and reasonably allocable to the Plant
McIntosh CTs and the CT Common Facilities and for which Savannah
has not been otherwise reimbursed by the Participants, which
costs are properly recordable in accordance with the Electric
Plant Instructions and in appropriate accounts as set forth in
the Uniform System of Accounts, and shall also include all costs
incurred by Savannah, as Agent for the Participants in connection
with the purchase and acquisition of (i) the initial supply of
fuel for the Plant McIntosh CTs to the extent such fuel is
consumed by any of the Plant McIntosh CTs prior to the respective
dates of Commercial Operation of such Plant McIntosh CTs,
including, without limitation, that portion of administrative and
general expenses incurred by Savannah, as Agent, which is
properly and reasonably allocable to such acquisition of fuel for
the Plant McIntosh CTs and for which Savannah has not been
otherwise reimbursed by the Participants, and (ii) the initial
supply of spare parts, and any replacements for such spare parts
utilized during pre-Commercial Operation construction activities,
for the Plant McIntosh CTs and the CT Common Facilities,
including, without limitation, that portion of administrative and
general expenses incurred by Savannah, as Agent, which is
properly and reasonably allocable to such acquisition of spare
parts and for which Savannah has not been otherwise reimbursed by
the Participants; provided, however, that Cost of Construction
shall not include (i) costs incurred by Savannah in connection
with the draining and cleaning (except sand-blasting) of the
existing Fuel Oil Tank as preparatory to its becoming part of the
CT Common Facilities, (ii) interest cost attributable to the
carrying of any Participant's respective investment in the Plant
McIntosh CTs or the CT Common Facilities, or (iii) costs and
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expenses incurred by any Participant in connection with the
development of this Agreement or the Collateral Documents.
(p) CT COMMON FACILITIES. The "CT Common Facilities"
shall consist of:
(i) All the property, both real and personal, used
or intended to be used in common by, or in connection with,
the Plant McIntosh CTs, including, without limitation, (A)
all that certain real property which is used or intended to
be used in connection with the Plant McIntosh CTs, which
real property is approximately shown as crosshatched on the
site plan attached hereto as Exhibit B and made a part
hereof, the exact legal description of which land shall be
determined upon completion of construction of the equipment
and facilities comprising a portion of the CT Common
Facilities, GPC and Savannah hereby agreeing that the exact
legal description for such parcel shall be substituted for
Exhibit B hereof upon completion of the survey of such
parcel of land and the approval of such survey by GPC and
Savannah, and such legal description shall become a part
hereof automatically upon such substitution, and (B)
starting modules, service building, the fuel oil storage
tank or tanks, the fuel oil distribution system, the
improvements to the fire protection system, the water
storage tank and water distribution system, the natural gas
system, all switchyard equipment and facilities excluding
the generator step-up transformers, the transmission line or
lines connecting the Plant McIntosh CT Project switchyard to
the existing Plant McIntosh 230 kv switchyard, and all
miscellaneous property improvements such as roadways,
fencing and lighting but excluding the CT Fuel Supply;
(ii) Such additional land or rights therein as may be
acquired, and such additional facilities and other tangible
property as may be acquired, constructed, installed or
replaced, and which are used or intended to be used in
common by, or in connection with, the Plant McIntosh CTs,
(but excluding any such additional tangible property as may
constitute a portion of the CT Fuel Supply), provided that
(A) the cost of such additional land or rights therein or of
such additional facilities or other tangible property shall
be properly recordable in accordance with the Uniform System
of Accounts, (B) such additional land or rights therein or
such additional facilities or other tangible property shall
have been acquired, constructed, installed or replaced for
the common use of the Participants under and subject to the
provisions of this Agreement, and (C) the acquisition of
such additional land or rights therein or the acquisition,
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construction, installation or replacement of such additional
facilities or other tangible property shall (1) be necessary
in order to keep the Plant McIntosh CT Project in good
operating condition or to satisfy the requirements of any
Governmental Authority having jurisdiction over the Plant
McIntosh CT Project, or (2) be mutually agreed to by the
Participants; and
(iii) Existing intangible property rights, and such
additional intangible property rights as may hereafter be
acquired, associated with the planning, licensing, design,
construction, acquisition, completion, testing, startup,
operation, renewal, addition, replacement, modification and
disposal of any of the items described in clauses (i)
through (iii) of this Section 1(p).
(q) CT COMMON FACILITIES SITE. The "CT Common Facilities
Site" shall refer to so much of the CT Common Facilities as
constitutes real property. The CT Common Facilities Site is a
subset of the Plant McIntosh Site and is a separate and distinct
parcel of land from the GPC Plant McIntosh CTs Site and the
Savannah Plant McIntosh CTs Site.
(r) CT FUEL SUPPLY. The "CT Fuel Supply" shall mean the
fossil fuel supply of oil maintained in the fuel oil storage tank
or of natural gas provided by pipeline, as the case may be, for
the Plant McIntosh CTs pursuant to Section 3(c), FOSSIL FUEL, of
the Operating Agreement.
(s) DUE DILIGENCE. "Due Diligence" shall have the meaning
assigned in Section 10(p), CONTINUING DUE DILIGENCE, hereof.
(t) EXECUTION AND DELIVERY. The "Execution and Delivery"
shall have the meaning assigned in Section 4(c), EXECUTION AND
DELIVERY, hereof.
(u) FERC. The "FERC" shall mean the Federal Energy
Regulatory Commission or any entity succeeding to the powers and
functions thereof.
(v) FORCE MAJEURE EVENT. A "Force Majeure Event" shall
refer to any event which occurs due to no fault of the Party
asserting the occurrence of such event, and which is beyond the
reasonable control of such Party, including, but not limited to:
strike or other labor difficulty or dispute; lockout; act of God;
change in Legal Requirements; absence as of any particular time
of precise engineering and scientific knowledge generally
available to fashion a method for compliance with Legal
Requirements or absence as of any particular time of appropriate
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technology generally available which may be required for
compliance with Legal Requirements; act or omission of any
Governmental Authority; act or omission of any third party other
than the Party asserting a Force Majeure Event; act of a public
enemy; expropriation or confiscation of facilities; riot;
rebellion; sabotage; embargo; blockade; quarantine; restriction;
epidemic; accident; wreck or delay in transportation;
unavailability or shortage of fuel, power, material or labor;
equipment failure; declared or undeclared war; or damage
resulting from wind, lightning, fire, flood, earthquake,
explosion or other physical disaster; provided, however, that no
Party shall be required by the foregoing provisions to settle a
strike, lockout or other labor difficulty or dispute except when,
according to its own best judgment, such a settlement seems
advisable.
(w) FUEL COSTS. The "Fuel Costs" shall mean all costs
incurred by the Agent for the Participants that are allocable to
the acquisition, processing, transportation, delivering,
handling, storage, accounting, analysis, measurement and disposal
of fuel for the CT Fuel Supply, including, without limitation,
any advance payments in connection therewith, less credits
related to such costs applied as appropriate, and including,
without limitation, that portion of administrative and general
expenses which is properly and reasonably allocable to
acquisition and management of fuel for the CT Fuel Supply and for
which the Agent has not been otherwise reimbursed by the
Participants; provided, however, that Fuel Costs shall not
include any costs allocable to the purchase and acquisition of
the initial supply of fuel for the Plant McIntosh CT Project to
the extent such fuel is consumed by any of the Plant McIntosh CTs
prior to the respective dates of Commercial Operation of such
Plant McIntosh CTs.
(x) FUEL OIL TANK. The "Fuel Oil Tank" shall refer to the
existing nine million gallon fuel oil storage tank, wholly owned
by Savannah prior to the Closing, a percentage undivided
ownership interest in which will be conveyed to GPC at the
Closing, and which shall be used to store water for the Plant
McIntosh CTs.
(y) GEPD. The "GEPD" shall refer to the Georgia
Environmental Protection Division of the Georgia Natural
Resources Department, a subdivision of the State of Georgia, or
any entity succeeding to the powers and functions thereof.
(z) GOVERNMENTAL AUTHORITY. A "Governmental Authority"
shall mean any local, state, regional or federal administrative,
legal, judicial, or executive agency, court, commission,
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department or other entity, but excluding any agency, commission,
department or other such entity acting in its capacity as lender,
guarantor or mortgagee.
(aa) GPC PLANT MCINTOSH CTS. The "GPC Plant McIntosh CTs"
shall refer collectively to Plant McIntosh CT Nos. 01 and 02,
Plant McIntosh CT Nos. 03 and 04, Plant McIntosh CT Nos. 07 and
08, and one or more of the Additional Plant McIntosh CTs, any one
of which shall be a GPC Plant McIntosh CT; provided, however,
that none of the Additional Plant McIntosh CTs shall be included
in the GPC Plant McIntosh CTs until such time as GPC provides
written notice to Savannah that GPC is planning to construct one
or more of the Additional Plant McIntosh CTs, as the case may be,
in order to serve GPC's energy needs; and provided further that
the GPC Plant McIntosh CTs shall not include any GPC Plant
McIntosh CT which GPC decides shall not be constructed and which
is so identified in a written notice to Savannah.
(ab) GPC PLANT MCINTOSH CTS SITE. The "GPC Plant McIntosh
CTs Site" shall refer to so much of the GPC Plant McIntosh CTs as
constitutes real property.
(ac) GPSC. The "GPSC" shall mean the Georgia Public
Service Commission or any governmental agency succeeding to the
powers and functions thereof.
(ad) INDENTURE. The "Indenture" shall refer to that
certain Indenture dated as of March 1, 1945, from Savannah to
NationsBank of Georgia, National Association, as Trustee, as
amended and supplemented to the date hereof.
(ae) LEASE. The "Lease" shall have the meaning assigned in
Section 4(a), LEASE OF LAND, hereof.
(af) LEGAL REQUIREMENTS. "Legal Requirements" shall mean
all laws, codes, ordinances, orders, judgments, decrees,
injunctions, licenses, rules, permits, approvals, regulations and
requirements of every Governmental Authority having jurisdiction
over the matter in question, whether federal, state or local,
which may be applicable to Savannah, as Agent, or any
Participant, as required by the context in which used, or to the
Plant McIntosh CT Project, or to the use, manner of use,
occupancy, possession, planning, licensing, design, procurement,
construction, acquisition, testing, startup, operation,
maintenance, management, control, addition, renewal,
modification, replacement or disposal of the Plant McIntosh CT
Project, or any portion or portions thereof.
-9-
(ag) OPERATING ACCOUNT. The "Operating Account" shall
refer to the separate, interest bearing account or accounts, in a
bank or banks, the deposits in which are insured, subject to
applicable limits, by the Federal Deposit Insurance Corporation
and which meets or meet all applicable requirements imposed upon
depositories of Savannah, established by Savannah as Agent,
pursuant to the terms of the Operating Agreement, for the payment
of Operating Costs.
(ah) OPERATING AGREEMENT. "Operating Agreement" shall
refer to that certain Plant McIntosh Combustion Turbine Operating
Agreement, dated as of the date hereof, between GPC and Savannah,
as such agreement may be amended from time to time.
(ai) OPERATING BUDGET. The "Operating Budget" shall refer
to the budgets pertaining to Operating Costs to be delivered to
the Participants pursuant to the terms of Section 2(c),
DEVELOPMENT OF BUDGETS, PLANS AND SCHEDULES, of the Operating
Agreement.
(aj) OPERATING COSTS. "Operating Costs" shall have the
meaning given in Section 1(af), OPERATING COSTS, of the Operating
Agreement.
(ak) PARTICIPANTS. "Participant" and "Participants" shall
refer individually or collectively, as the case may be, to GPC
and Savannah (in their capacities as owners of one or more of the
Plant McIntosh CTs) and to any permitted transferee or assignee
of either of them of an ownership or leasehold interest in the
Plant McIntosh CT Project pursuant to Section 6(c), ALIENATION
AND ASSIGNMENT, hereof made in conformity with those provisions
of this Agreement and the Operating Agreement pertaining to the
Plant McIntosh CTs, the CT Common Facilities and the CT Fuel
Supply, provided, however, such references shall only refer to an
entity for so long as said entity has an ownership or an
ownership and a leasehold interest in the Plant McIntosh CT
Project.
(al) PARTY. A "Party" shall refer to any entity which is
now or hereafter a party to this Agreement; provided, however,
such reference shall only refer to an entity for so long as such
entity is a party to this Agreement.
(am) PLANT MCINTOSH. "Plant McIntosh" shall refer to the
Plant McIntosh Site plus all improvements thereon including,
without limitation, the Plant McIntosh CT Project and that
certain Plant McIntosh 170 Mw coal-fired generating plant, owned
by Savannah, together with its supporting facilities and
equipment.
-10-
(an) PLANT MCINTOSH CT NOS. 01 AND 02. Plant McIntosh CT
Nos. 01 and 02 shall refer to:
(i) That certain real property upon which shall be
constructed and located two (2) complete combustion turbine-
generator units to be known as Plant McIntosh CT Nos. 01 and
02, the exact legal description for which land shall be
determined upon completion of such construction, and which
shall comprise a parcel of land approximately 200 feet by
300 feet, and which parcel is approximately shown as
crosshatched and labeled as the "CT Nos. 01 and 02 Parcel"
on Exhibit A1/2 hereof and incorporated herein, together
with all such additional land, appurtenant easements or
other rights therein as may hereafter be acquired for the
purposes specified in subsection (iii) of this Section
1(an). GPC and Savannah agree that the exact legal
description for the aforedescribed parcel of land shall be
substituted for Exhibit A1/2 hereof upon completion of the
survey of such parcel of land and the approval of such
survey by GPC, and such legal description shall become a
part hereof automatically upon such substitution;
(ii) All personal property comprising the combustion
turbine-generator units to be known as Plant McIntosh CT
Nos. 01 and 02, including, without limitation, two complete
combustion turbine-generator units (each comprised of a gas
turbine block, a combustion chamber, a generator exciter
block, a stack, a fin fan cooler, an auxiliary skid, a water
injection block, a cooling water block, a power and control
module, a battery module, a generator breaker module, a
generator bus duct, unit auxiliary transformer secondary
switchgear, a fuel oil pump block, an air intake filter, a
unit auxiliary transformer and a transfer switch module),
the enclosures housing the same and a main step-up
transformer which are to be used solely in connection with
Plant McIntosh CT Nos. 01 and 02, all as the foregoing list
of personal property may be modified or supplemented at the
Closing;
(iii) Such additional land, easements or other rights
therein as may be acquired, and such additional facilities
and other tangible property as may be acquired, constructed,
installed or replaced solely in connection with Plant
McIntosh CT Nos. 01 or 02 or both; provided that (A) the
cost of such additional land, easements or other rights
therein or of such additional facilities or other tangible
property shall be properly recordable in accordance with the
Uniform System of Accounts, (B) such additional land,
easements or other rights therein or such additional
-11-
facilities or other tangible property shall have been
acquired, constructed, installed or replaced for the use of
the Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 01 and 02 under
and subject to the provisions of this Agreement, and (C) the
acquisition of such additional land, easements or other
rights therein or the acquisition, construction,
installation or replacement of such additional facilities or
other tangible property shall (1) be necessary in order to
keep Plant McIntosh CT Nos. 01 and 02 (or either of them) in
good operating condition or to satisfy the requirements of
any Governmental Authority having jurisdiction over Plant
McIntosh CT Nos. 01 and 02, or (2) be agreed to by the
Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 01 and 02; and
(iv) Existing intangible property rights, and such
additional intangible property rights as may be hereafter
acquired, associated with the planning, licensing, design,
construction, acquisition, completion, testing, startup,
management, control, operation, maintenance, renewal,
addition, replacement, modification and disposal of any of
the items in this Section 1(an).
(ao) PLANT MCINTOSH CT NOS. 03 AND 04. Plant McIntosh CT
Nos. 03 and 04 shall refer to:
(i) That certain real property upon which shall be
constructed and located two (2) complete combustion turbine-
generator units to be known as Plant McIntosh CT Nos. 03 and
04, the exact legal description for which land shall be
determined upon completion of such construction, and which
shall comprise a parcel of land approximately 200 feet by
300 feet, and which parcel is approximately shown as
crosshatched and labeled as the "CT Nos. 03 and 04 Parcel"
on Exhibit A3/4 hereof and incorporated herein, together
with all such additional land, appurtenant easements or
other rights therein as may hereafter be acquired for the
purposes specified in subsection (iii) of this Section
1(ao). GPC and Savannah agree that the exact legal
description for the aforedescribed parcel of land shall be
substituted for Exhibit A3/4 hereof upon completion of the
survey of such parcel of land and the approval of such
survey by GPC, and such legal description shall become a
part hereof automatically upon such substitution;
(ii) All personal property comprising the combustion
turbine-generator units to be known as Plant McIntosh CT
Nos. 03 and 04, including, without limitation, two complete
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combustion turbine-generator units (each comprising a gas
turbine block, a combustion chamber, a generator exciter
block, a stack, a fin fan cooler, an auxiliary skid, a water
injection block, a cooling water block, a power and control
module, a battery module, a generator breaker module, a
generator bus duct, unit auxiliary transformer secondary
switchgear, a fuel oil pump block, an air intake filter, a
unit auxiliary transformer and a transfer switch module),
the enclosures housing the same and a main step-up
transformer which are to be used solely in connection with
Plant McIntosh CT Nos. 03 and 04, all as the foregoing list
of personal property may be modified or supplemented at the
Closing;
(iii) Such additional land, easements or other rights
therein as may be acquired, and such additional facilities
and other tangible property as may be acquired, constructed,
installed or replaced solely in connection with Plant
McIntosh CT Nos. 03 or 04 or both; provided that (A) the
cost of such additional land, easements or other rights
therein or of such additional facilities or other tangible
property shall be properly recordable in accordance with the
Uniform System of Accounts, (B) such additional land,
easements or other rights therein or such additional
facilities or other tangible property shall have been
acquired, constructed, installed or replaced for the use of
the Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 03 and 04 under
and subject to the provisions of this Agreement, and (C) the
acquisition of such additional land, easements or other
rights therein or the acquisition, construction,
installation or replacement of such additional facilities or
other tangible property shall (1) be necessary in order to
keep Plant McIntosh CT Nos. 03 and 04 (or either of them) in
good operating condition or to satisfy the requirements of
any Governmental Authority having jurisdiction over Plant
McIntosh CT Nos. 03 and 04, or (2) be agreed to by the
Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 03 and 04; and
(iv) Existing intangible property rights, and such
additional intangible property rights as may be hereafter
acquired, associated with the planning, licensing, design,
construction, acquisition, completion, testing, startup,
management, control, operation, maintenance, renewal,
addition, replacement, modification and disposal of any of
the items in this Section 1(ao).
-13-
(ap) PLANT MCINTOSH CT NOS. 05 AND 06. Plant McIntosh CT
Nos. 05 and 06 shall refer to:
(i) That certain real property upon which shall be
constructed and located two (2) complete combustion turbine-
generator units to be known as Plant McIntosh CT Nos. 05 and
06, the exact legal description for which land shall be
determined upon completion of such construction, and which
shall comprise a parcel of land approximately 200 feet by
300 feet, and which parcel is approximately shown as
crosshatched and labeled as the "CT Nos. 05 and 06 Parcel"
on Exhibit A5/6 hereof and incorporated herein, together
with all such additional land, appurtenant easements or
other rights therein as may hereafter be acquired for the
purposes specified in subsection (iii) of this Section
1(ap). GPC and Savannah agree that the exact legal
description for the aforedescribed parcel of land shall be
substituted for Exhibit A5/6 hereof upon completion of the
survey of such parcel of land and the approval of such
survey by GPC, and such legal description shall become a
part hereof automatically upon such substitution;
(ii) All personal property comprising the combustion
turbine-generator units to be known as Plant McIntosh CT
Nos. 05 and 06, including, without limitation, two complete
combustion turbine-generator units (each comprising a gas
turbine block, a combustion chamber, a generator exciter
block, a stack, a fin fan cooler, an auxiliary skid, a water
injection block, a cooling water block, a power and control
module, a battery module, a generator breaker module, a
generator bus duct, unit auxiliary transformer secondary
switchgear, a fuel oil pump block, an air intake filter, a
unit auxiliary transformer and a transfer switch module),
the enclosures housing the same and a main step-up
transformer which are to be used solely in connection with
Plant McIntosh CT Nos. 05 and 06, all as the foregoing list
of personal property may be modified or supplemented at the
Closing;
(iii) Such additional land, easements or other rights
therein as may be acquired, and such additional facilities
and other tangible property as may be acquired, constructed,
installed or replaced solely in connection with Plant
McIntosh CT Nos. 05 or 06 or both; provided that (A) the
cost of such additional land, easements or other rights
therein or of such additional facilities or other tangible
property shall be properly recordable in accordance with the
Uniform System of Accounts, (B) such additional land,
easements or other rights therein or such additional
-14-
facilities or other tangible property shall have been
acquired, constructed, installed or replaced for the use of
the Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 05 and 06 under
and subject to the provisions of this Agreement, and (C) the
acquisition of such additional land, easements or other
rights therein or the acquisition, construction,
installation or replacement of such additional facilities or
other tangible property shall (1) be necessary in order to
keep Plant McIntosh CT Nos. 05 and 06 (or either of them) in
good operating condition or to satisfy the requirements of
any Governmental Authority having jurisdiction over Plant
McIntosh CT Nos. 05 and 06, or (2) be agreed to by the
Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 05 and 06; and
(iv) Existing intangible property rights, and such
additional intangible property rights as may be hereafter
acquired, associated with the planning, licensing, design,
construction, acquisition, completion, testing, startup,
management, control, operation, maintenance, renewal,
addition, replacement, modification and disposal of any of
the items in this Section 1(ap).
(aq) PLANT MCINTOSH CT NOS. 07 AND 08. Plant McIntosh CT
Nos. 07 and 08 shall refer to:
(i) That certain real property upon which shall be
constructed and located two (2) complete combustion turbine-
generator units to be known as Plant McIntosh CT Nos. 07 and
08, the exact legal description for which land shall be
determined upon completion of such construction, and which
shall comprise a parcel of land approximately 200 feet by
300 feet, and which parcel is approximately shown as
crosshatched and labeled as the "CT Nos. 07 and 08 Parcel"
on Exhibit A7/8 hereof and incorporated herein, together
with all such additional land, appurtenant easements or
other rights therein as may hereafter be acquired for the
purposes specified in subsection (iii) of this Section
1(aq). GPC and Savannah agree that the exact legal
description for the aforedescribed parcel of land shall be
substituted for Exhibit A7/8 hereof upon completion of the
survey of such parcel of land and the approval of such
survey by GPC, and such legal description shall become a
part hereof automatically upon such substitution;
(ii) All personal property comprising the combustion
turbine-generator units to be known as Plant McIntosh CT
Nos. 07 and 08, including, without limitation, two complete
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combustion turbine-generator units (each comprising a gas
turbine block, a combustion chamber, a generator exciter
block, a stack, a fin fan cooler, an auxiliary skid, a water
injection block, a cooling water block, a power and control
module, a battery module, a generator breaker module, a
generator bus duct, unit auxiliary transformer secondary
switchgear, a fuel oil pump block, an air intake filter, a
unit auxiliary transformer and a transfer switch module),
the enclosures housing the same and a main step-up
transformer which are to be used solely in connection with
Plant McIntosh CT Nos. 07 and 08, all as the foregoing list
of personal property may be modified or supplemented at the
Closing;
(iii) Such additional land, easements or other rights
therein as may be acquired, and such additional facilities
and other tangible property as may be acquired, constructed,
installed or replaced solely in connection with Plant
McIntosh CT Nos. 07 or 08 or both; provided that (A) the
cost of such additional land, easements or other rights
therein or of such additional facilities or other tangible
property shall be properly recordable in accordance with the
Uniform System of Accounts, (B) such additional land,
easements or other rights therein or such additional
facilities or other tangible property shall have been
acquired, constructed, installed or replaced for the use of
the Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 07 and 08 under
and subject to the provisions of this Agreement, and (C) the
acquisition of such additional land, easements or other
rights therein or the acquisition, construction,
installation or replacement of such additional facilities or
other tangible property shall (1) be necessary in order to
keep Plant McIntosh CT Nos. 07 and 08 (or either of them) in
good operating condition or to satisfy the requirements of
any Governmental Authority having jurisdiction over Plant
McIntosh CT Nos. 07 and 08, or (2) be agreed to by the
Participant having an ownership interest in the personal
property comprising Plant McIntosh CT Nos. 07 and 08; and
(iv) Existing intangible property rights, and such
additional intangible property rights as may be hereafter
acquired, associated with the planning, licensing, design,
construction, acquisition, completion, testing, startup,
management, control, operation, maintenance, renewal,
addition, replacement, modification and disposal of any of
the items in this Section 1(aq).
-16-
(ar) PLANT MCINTOSH CT PROJECT. The "Plant McIntosh CT
Project" shall refer to the Plant McIntosh CTs, the CT Common
Facilities and the CT Fuel Supply.
(as) PLANT MCINTOSH CTS. The "Plant McIntosh CTs" shall
consist collectively of Plant McIntosh CT Nos. 01 and 02, Plant
McIntosh CT Nos. 03 and 04, Plant McIntosh CT Nos. 05 and 06,
Plant McIntosh CT Nos. 07 and 08, and one or more of the
Additional Plant McIntosh CTs, any one of which shall be a Plant
McIntosh CT; provided, however, that none of the Additional Plant
McIntosh CTs shall be included in the Plant McIntosh CTs until
such time as one or more Participants provide written notice to
the other Participants that they are planning to construct one or
more of the Additional Plant McIntosh CTs, as the case may be, in
order to serve such Participants' energy needs; and provided
further that the Plant McIntosh CTs shall not include any Plant
McIntosh CT which the Participant owning such unit decides shall
not be constructed and which is so identified in a written notice
to the other Participant.
(at) PLANT MCINTOSH CTS SITE. The "Plant McIntosh CTs
Site" shall refer to that portion of the Plant McIntosh CTs which
constitutes real property.
(au) 1994 PLANT MCINTOSH CTS. The "1994 Plant McIntosh
CTs" shall refer to Plant McIntosh CT Nos. 07 and 08, Plant
McIntosh CT Nos. 05 and 06, and Plant McIntosh CT Nos. 03 and 04,
any one (of the six) of which shall be a 1994 Plant McIntosh CT;
provided, however, that the 1994 Plant McIntosh CTs shall not
include any 1994 Plant McIntosh CT which the Participant owning
such unit decides shall not be constructed and which is so
identified in a written notice to the other Participant.
(av) 1995 PLANT MCINTOSH CTS. The "1995 Plant McIntosh
CTs" shall refer to Plant McIntosh CT Nos. 01 and 02, either one
of which shall be a 1995 Plant McIntosh CT; provided, however,
that the 1995 Plant McIntosh CTs shall not include any 1995 Plant
McIntosh CT which the Participant owning such unit decides shall
not be constructed and which is so identified in a written notice
to the other Participant.
(aw) PLANT MCINTOSH SITE. The "Plant McIntosh Site" shall
refer to the real property which is described in Exhibit F
attached hereto and made a part hereof.
(ax) PRIME RATE. The "Prime Rate" shall mean the per annum
rate of interest announced from time to time by Chemical Bank as
its prime rate, and with respect to any payment or reimbursement
to be made hereunder to which interest is to be added (other than
-17-
an adjustment to the Purchase Price), shall be determined as of
the date such payment or reimbursement is due, and with respect
to any adjustment to the Purchase Price as to which interest is
to be added pursuant to the terms hereof, shall be determined as
of the date of the Closing for which such adjustment is to be
made. The Prime Rate shall be calculated on the basis of a 365-
day year for the actual number of days that the payment,
reimbursement or purchase price adjustment, as the case may be,
has not been made.
(ay) PRO FORMA OWNERSHIP INTEREST. A "Pro Forma Ownership
Interest" shall mean for each Participant the number of the Plant
McIntosh CTs (whether or not completed) owned by such Participant
divided by the total number of Plant McIntosh CTs (whether or not
completed); provided, however, that none of the Additional Plant
McIntosh CTs shall be included in the calculation of Pro Forma
Ownership Interest until such time as one or more Participants
provide written notice to the other Participants that they are
planning to construct one or more of the Additional Plant
McIntosh CTs, as the case may be, in order to serve such
Participants' energy needs; provided further that, for purposes
of this definition of Pro Forma Ownership Interest, no Plant
McIntosh CT shall be included which has been cancelled by the
Participant owning such Plant McIntosh CT and which is identified
in a written notice of cancellation to the other Participant.
(az) PROJECT MANAGEMENT BOARD. The "Project Management
Board" shall refer to the Plant McIntosh CT Project Management
Board established pursuant to Section 5(k), PLANT MCINTOSH CT
PROJECT MANAGEMENT BOARD, hereof.
(ba) PRUDENT UTILITY PRACTICE. "Prudent Utility Practice"
at a particular time shall mean any of the practices, methods and
acts engaged in or approved by a significant portion of the
electric utility industry prior to such time, or any of the
practices, methods and acts, which in the exercise of reasonable
judgment in light of the facts known at the time the decision was
made, could have been expected to accomplish the desired result
at the lowest reasonable cost consistent with good business
practices, reliability, safety and expedition. "Prudent Utility
Practice" is not intended to be limited to the optimum practice,
method or act to the exclusion of all others, but rather to be a
spectrum of possible practices, methods or acts having due regard
for, among other things, manufacturers' warranties and the
requirements of Governmental Authorities of competent
jurisdiction and the requirements of this Agreement and the
Operating Agreement. Compliance by Savannah with the provisions
of any budget estimate which has been altered by the Participants
pursuant to this Agreement or the Operating Agreement, as the
-18-
case may be, from any such estimate submitted by Savannah shall
not, in and of itself, constitute a breach by Savannah of its
obligation to discharge its responsibilities as Agent for the
Participants hereunder in accordance with Prudent Utility
Practice.
(bb) PURCHASE PRICE. The "Purchase Price" shall have the
meaning assigned in subsection (i) of Section 3(b), PURCHASE
PRICE AND PAYMENT, hereof.
(bc) RELEASE. "Release" shall mean a release executed and
delivered by the holder of a mortgage, deed to secure debt or
other security interest (including, without limitation,
NationsBank of Georgia, National Association, as Trustee under
the Indenture) sufficient to release the real or personal
property which is the subject thereof from the lien, security
title and effect of such mortgage, deed to secure debt or other
security insterest and, with respect to any release given as to
real property, sufficient to eliminate such mortgage, deed to
secure debt or other security interest as an exception to the
coverage under an owner's title insurance policy.
(bd) RENT. The "Rent" shall have the meaning assigned in
subsection (i) of Section 4(b), RENT AND PAYMENT, hereof.
(be) SAVANNAH PLANT MCINTOSH CTS. The "Savannah Plant
McIntosh CTs" shall refer to Plant McIntosh CT Nos. 05 and 06 and
one or more of the Additional Plant McIntosh CTs, any one of
which is a Savannah Plant McIntosh CT; provided, however, that
none of the Additional Plant McIntosh CTs shall be included in
the Savannah Plant McIntosh CTs until such time as Savannah
provides written notice to GPC that Savannah is planning to
construct one or more of the Additional Plant McIntosh CTs, as
the case may be, in order to serve Savannah's energy needs; and
provided further that the Savannah Plant McIntosh CTs shall not
include any Savannah Plant McIntosh CT which Savannah decides
shall not be constructed and which is so identified in a written
notice to GPC.
(bf) SAVANNAH PLANT MCINTOSH CTS SITE. The "Savannah Plant
McIntosh CTs Site" shall refer to so much of the Savannah Plant
McIntosh CTs as constitutes real property.
(bg) SCSI. "SCSI" shall mean Southern Company Services,
Inc., a corporation organized and existing under the laws of the
State of Alabama, and any successor corporation.
-19-
(bh) SEC. The "SEC" shall refer to the Securities and
Exchange Commission or any governmental agency succeeding to the
powers and functions thereof.
(bi) SITE REPRESENTATIVE. "Site Representative" shall
refer to the term as described in Section 5(e), ON-SITE
OBSERVATION AND INSPECTION, hereof.
(bj) THE SOUTHERN COMPANY. "The Southern Company" shall
refer to The Southern Company, a corporation organized and
existing under the laws of the State of Delaware.
(bk) UNIFORM SYSTEM OF ACCOUNTS. The "Uniform System of
Accounts" shall mean the FERC Uniform System of Accounts
prescribed for Public Utilities and Licensees (Class A and Class
B), as the same now exists or may be hereafter amended by the
FERC.
2. REPRESENTATIONS AND WARRANTIES.
(a) GPC REPRESENTATIONS AND WARRANTIES. GPC hereby
represents and warrants to Savannah as follows:
(i) Organization and Existence. GPC is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Georgia and has
sufficient corporate power and authority to own and lease
those portions of the Plant McIntosh CT Project as it is
required to own and lease from time to time pursuant to the
terms of this Agreement, to execute and deliver this
Agreement and the Operating Agreement and to perform its
obligations hereunder and thereunder and to carry on its
business as it is now being conducted and as it is
contemplated hereunder and thereunder to be conducted in the
future.
(ii) Due Authorization.
(A) The execution, delivery and performance of
this Agreement by GPC has been duly and effectively
authorized by all requisite corporate action. This
Agreement constitutes the legal, valid and binding
obligation of GPC, enforceable against GPC in
accordance with its terms, except as limited by
applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting the rights of
creditors generally and by general principles of
equity.
-20-
(B) The execution, delivery and performance of
the Operating Agreement by GPC has been duly and
effectively authorized by all requisite corporate
action. The Operating Agreement constitutes the legal,
valid and binding obligation of GPC, enforceable
against GPC in accordance with its terms, except as
limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the
rights of creditors generally and by general principles
of equity.
(iii) Litigation. Other than as may be disclosed in
GPC's Annual Report on Form 10-K for the year ended 1991,
its quarterly reports on Form 10-Q for the quarters ended
March 31, June 30 and September 30, 1992, or as may be
otherwise disclosed in writing by GPC to Savannah, there is
no action, suit, claim, proceeding or investigation pending
or threatened against GPC by or before any Governmental
Authority having jurisdiction over GPC or its ownership
interest in the Plant McIntosh CT Project which, if
adversely determined, would have a material adverse effect
upon GPC's ability to enter into and perform its material
obligations and consummate the material transactions
contemplated by this Agreement and the Operating Agreement
or the material rights of Savannah as a tenant in common in
the CT Common Facilities and the CT Fuel Supply. GPC is not
subject to any material outstanding judgment, order, writ,
injunction or decree of any Governmental Authority having
jurisdiction over GPC or its ownership interest in the Plant
McIntosh CT Project which would materially and adversely
affect its ability to enter into and perform its material
obligations under this Agreement and the Operating Agreement
or the material rights of Savannah as a tenant in common in
the CT Common Facilities and the CT Fuel Supply.
(iv) No Material Violation, No Material Impairment.
There is no provision of GPC's charter or bylaws, nor any
existing statute, law, regulation, material note, bond,
resolution, indenture, agreement or instrument to which GPC
is a party and which is enforceable against GPC which would
be materially violated by or which would materially impair
GPC's entry into this Agreement or the Operating Agreement,
the performance by GPC of its material obligations hereunder
and thereunder in accordance with the terms hereof and
thereof or the consummation of the material transactions
contemplated hereby or thereby in accordance with the terms
hereof and thereof.
-21-
(v) Approvals. Other than (A) the approval by the
GPSC of the GPC Application for Certification of the
McIntosh Combustion Turbine Project, (B) the approval of the
SEC under the Public Utility Holding Company Act of 1935,
(C) the approval of the GEPD, the Army Corps of Engineers
and Effingham County for certain permits or licenses, and
(D) the agreement of the Parties hereto to the terms and
provisions and execution and delivery of the Operating
Agreement, there are no approvals or consents other than
those referenced in Section 8, CONDITIONS PRECEDENT TO
EXECUTION AND DELIVERY, and Section 9, CONDITIONS PRECEDENT
TO CLOSING, hereof, the absence of which would materially
impair GPC's ability to consummate the transactions
described in Section 3, SALE TO GPC OF AN UNDIVIDED
OWNERSHIP INTEREST IN CERTAIN OF THE CT COMMON FACILITIES
EQUIPMENT, and Section 4, LEASE TO GPC OF THE GPC PLANT
MCINTOSH CTS SITE AND THE CT COMMON FACILITIES SITE, hereof.
(b) SAVANNAH REPRESENTATIONS AND WARRANTIES. Savannah
hereby represents and warrants to GPC as follows:
(i) Organization and Existence. Savannah is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Georgia and has
sufficient corporate power and authority to own those
portions of the Plant McIntosh CT Project as it now owns and
as it is required to own from time to time pursuant to the
terms of this Agreement, to execute and deliver this
Agreement and the Collateral Documents and to perform its
obligations hereunder and thereunder and to carry on its
business as it is now being conducted and as it is
contemplated hereunder and thereunder to be conducted in the
future.
(ii) Due Authorization.
(A) The execution, delivery and performance of
this Agreement by Savannah has been duly and
effectively authorized by all requisite corporate
action. This Agreement constitutes the legal, valid
and binding obligation of Savannah, enforceable against
Savannah in accordance with its terms, except as
limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the
rights of creditors generally and by general principles
of equity.
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(B) The execution, delivery and performance of
the Collateral Documents by Savannah has been duly and
effectively authorized by all requisite corporate
action. The Collateral Documents constitute the legal,
valid and binding obligations of Savannah, enforceable
against Savannah in accordance with their terms, except
as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the
rights of creditors generally and by general principles
of equity.
(iii) Litigation. Other than as may be disclosed in
Savannah's Annual Report on Form 10-K for the year ended
1991, its quarterly reports on Form 10-Q for the quarters
ended March 31, June 30 and September 30, 1992, or as may be
otherwise disclosed in writing by Savannah to GPC, there is
no action, suit, claim, proceeding or investigation pending
or threatened against Savannah by or before any Governmental
Authority having jurisdiction over Savannah or its ownership
interest in Plant McIntosh which, if adversely determined,
would have a material adverse effect upon Savannah's ability
to enter into and perform its material obligations and
consummate the material transactions contemplated by this
Agreement and the Collateral Documents or the material
rights of GPC as a tenant in common in the CT Common
Facilities and the CT Fuel Supply. Savannah is not subject
to any material outstanding judgment, order, writ,
injunction or decree of any Governmental Authority having
jurisdiction over Savannah or its ownership interest in
Plant McIntosh which would materially and adversely affect
its ability to enter into and perform its material
obligations under this Agreement and the Collateral
Documents or the material rights of GPC as a tenant in
common in the CT Common Facilities and the CT Fuel Supply.
(iv) No Material Violation, No Material Impairment.
There is no provision of Savannah's charter or bylaws, nor
any existing statute, law, regulation, material note, bond,
resolution, indenture, agreement or instrument to which
Savannah is a party and which is enforceable against
Savannah which would be materially violated by or which
would materially impair Savannah's entry into this Agreement
or the Collateral Documents, the performance by Savannah of
its material obligations hereunder and thereunder in
accordance with the terms hereof and thereof or the
consummation of the material transactions contemplated
hereby or thereby in accordance with the terms hereof and
thereof; provided, however, no representation or warranty is
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given with respect to the provisions of the Indenture in the
event of a default by Savannah under the Indenture.
(v) Approvals. Other than (A) the approval by the
GPSC of the Savannah Application for Certification of the
McIntosh Combustion Turbine Project, (B) the approval of the
SEC under the Public Utility Holding Company Act of 1935,
(C) the approval of the GEPD, the Army Corps of Engineers
and Effingham County for certain permits or licenses, and
(D) the agreement of the Parties hereto to the terms and
provisions and the execution and delivery of the Operating
Agreement, there are no approvals or consents other than
those referenced in Section 8, CONDITIONS PRECEDENT TO
EXECUTION AND DELIVERY, and Section 9, CONDITIONS PRECEDENT
TO CLOSING, hereof, the absence of which would materially
impair Savannah's ability to consummate the transactions
described in Section 3, SALE TO GPC OF AN UNDIVIDED
OWNERSHIP INTEREST IN CERTAIN OF THE CT COMMON FACILITIES
EQUIPMENT, and Section 4, LEASE TO GPC OF THE GPC PLANT
MCINTOSH CTS SITE AND THE CT COMMON FACILITIES SITE, hereof.
3. SALE TO GPC OF AN UNDIVIDED OWNERSHIP INTEREST IN CERTAIN OF
THE CT COMMON FACILITIES EQUIPMENT.
(a) SALE OF ASSETS. Subject to the terms and conditions
of this Agreement, at the Closing Savannah will sell and convey
to GPC and GPC will purchase from Savannah a percentage undivided
ownership interest, equivalent to GPC's Pro Forma Ownership
Interest, as it may appear at the time, as a tenant in common
with Savannah, in that portion of the CT Common Facilities
(excluding the CT Common Facilities Site) which has been
acquired, constructed or completed prior to the Closing and
which, prior to the Closing, is exclusively the property of
Savannah. Such conveyance will be by Bill of Sale substantially
in the form of Exhibit D attached hereto and made a part hereof.
At the Closing, Savannah will furnish to GPC a Release from any
and all mortgages, deeds to secure debt or other security
interests on such undivided ownership interests in that portion
of the CT Common Facilities equipment being conveyed to GPC at
the Closing.
(b) PURCHASE PRICE AND PAYMENT.
(i) The purchase price for the assets to be acquired
by GPC at the Closing pursuant to subsection (i) of Section
3(a), SALE OF ASSETS, hereof ("Purchase Price") will be the
original book cost of such assets less depreciation. The
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Purchase Price shall be payable to Savannah at the Closing
in immediately available funds.
(ii) From time to time after the Closing, Savannah
and GPC shall execute and deliver such other instruments of
conveyance and transfer as may be necessary or appropriate
or as either of them may reasonably request to vest in GPC
its respective undivided ownership interests in and to that
portion of the CT Common Facilities equipment being conveyed
to GPC at the Closing.
(c) CLOSING. Subject to the provisions of Section 9,
CONDITIONS PRECEDENT TO CLOSING, hereof, the closing of the sale
and transfer contemplated in Section 3(a), SALE OF ASSETS, hereof
(the "Closing") will take place at 10:00 a.m., 20 Business Days
prior to the scheduled first Commercial Operation date of any of
the Plant McIntosh CTs. Savannah shall provide GPC with written
notice of the Commercial Operation schedule 40 Business Days
prior to the scheduled first Commercial Operation date. The
Closing shall take place at the offices of Bouhan, Williams &
Levy, 447 Bull Street, Savannah, Georgia 31401.
If the Closing has not occurred on or prior to May 1,
1994, and postponement of the Closing is not mutually agreed to
in writing by GPC and Savannah, the Closing shall be cancelled
and all obligations, duties and rights of Savannah to GPC and GPC
to Savannah under this Agreement and the Operating Agreement
shall be of no further force and effect and Savannah shall have
no liability to GPC nor shall GPC have any liability to Savannah
hereunder except for the liability of Savannah or GPC for the
breach of its obligations hereunder on or prior to such date and
except as may otherwise be provided in Section 6(m), SHARING OF
COSTS - GENERAL, hereof. If on the date of the Closing, Savannah
or GPC is unable to consummate the transactions to be consummated
on such date due to the failure to receive a regulatory approval
stated herein to be a condition precedent to its ability to
perform, such approval has been applied for and has been
diligently pursued, and such approval remains pending and not
refused or rejected on such date, then Savannah or GPC, as the
case may be, shall be entitled to a reasonable extension of the
Closing in order to permit Savannah or GPC, as the case may be,
to obtain such pending approval.
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4. LEASE TO GPC OF THE GPC PLANT MCINTOSH CTS SITE AND THE CT
COMMON FACILITIES SITE.
(a) LEASE OF LAND. Subject to the terms and conditions of
this Agreement, at the Execution and Delivery Savannah will
execute and deliver to GPC a lease ("Lease") conveying (i) a 100%
leasehold interest in the GPC Plant McIntosh CTs Site, and (ii) a
percentage undivided interest, equivalent to GPC's Pro Forma
Ownership Interest, as it may appear at the time, in a leasehold
estate, as a tenant in common with Savannah, in the CT Common
Facilities Site. Such Lease will be substantially in the form of
Exhibit E attached hereto and made a part hereof. The Lease
shall terminate upon the earlier of (i) the termination of the
Operating Agreement, or (ii) the date which is 100 years from the
date of the Lease. At the Execution and Delivery, Savannah will
furnish to GPC a Release of such leasehold interests conveyed to
GPC in the GPC Plant McIntosh CTs Site and the CT Common
Facilities Site from the holder of any and all mortgages, deeds
to secure debt or other security interests, including, without
limitation, the Indenture.
In addition to the foregoing conveyances, Savannah
shall convey to GPC at the Execution and Delivery, easement
rights as follows: a non-exclusive easement, for the term of the
Lease, in, upon, over, under, through and across the Plant
McIntosh Site, less and except from the Plant McIntosh Site the
GPC Plant McIntosh CTs Site and the CT Common Facilities Site,
but including with respect to such grant of easement the Savannah
Plant McIntosh CTs Site. The terms and conditions of the
easement are as set forth in the Lease. As to the easement
rights to be granted in the Lease by Savannah to GPC, GPC
acknowledges and agrees that (i) Savannah reserves the right to
use the easement area in a manner wholly consistent with the
terms of the Lease, this Agreement, and the Operating Agreement,
(ii) the location of any improvements constructed or installed by
GPC pursuant to such easement shall be subject to the terms of
this Agreement, the Operating Agreement, the Lease and, if not
expressly governed thereby, to the prior, reasonable approval of
Savannah, and (iii) the use of such easement shall be for
purposes reasonably necessary or reasonably appropriate from time
to time in the operation of the Plant McIntosh CT Project or for
purposes for the benefit of or to be used in connection with the
Plant McIntosh CT Project.
From time to time after the Execution and Delivery, Savannah
and GPC shall execute and deliver such other instruments of
conveyance and transfer as may be necessary or appropriate or as
either of them may reasonably request to vest in GPC its
respective leasehold interests in and to the GPC Plant McIntosh
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CTs Site and the CT Common Facilities Site, as well as to provide
necessary easements appurtenant thereto.
(b) RENT AND PAYMENT. The rent for the leasehold
interests conveyed to GPC in Section 4(a), LEASE OF LAND, hereof
("Rent") shall be the sum of: (A) the original book cost of the
GPC Plant McIntosh CTs Site, plus (B) the original book cost of
the CT Common Facilities Site times GPC's Pro Forma Ownership
Interest; which sum shall then be multiplied by Savannah's
weighted cost of pretax capital as of December 31, 1991. The
Rent shall be paid to Savannah by July 1 of each year following
GPC's receipt of an annual invoice from Savannah for such Rent on
or about June 15 of each year. The first payment of the Rent
shall be prorated by the fraction of the number of days between
the Execution and Delivery and the date of Savannah's first
invoice divided by 365.
(c) EXECUTION AND DELIVERY. Subject to the provisions of
Section 8, CONDITIONS PRECEDENT TO EXECUTION AND DELIVERY hereof,
the execution and delivery of the Lease contemplated in Section
4(a), LEASE OF LAND, hereof (the "Execution and Delivery") will
take place at 10:00 a.m., 30 Business Days following receipt by
Savannah and GPC of all requisite approvals set forth in such
Section 8, but not later than April 1, 1994 at the offices of
Bouhan, Williams & Levy, 447 Bull Street, Savannah, Georgia.
If the Execution and Delivery has not occurred on or
prior to April 1, 1994, and postponement of the Execution and
Delivery is not mutually agreed to in writing by GPC and
Savannah, the Execution and Delivery shall be cancelled and all
obligations, duties and rights of Savannah to GPC and GPC to
Savannah under this Agreement and the Operating Agreement shall
be of no further force and effect and Savannah shall have no
liability to GPC nor shall GPC have any liability to Savannah
hereunder except for the liability of Savannah or GPC for the
breach of its obligations hereunder on or prior to such date and
except as may otherwise be provided in Section 6(m), SHARING OF
COSTS - GENERAL, hereof. If on the date of Execution and
Delivery, Savannah or GPC is unable to consummate the
transactions to be consummated on such date due to the failure to
receive a regulatory approval stated herein to be a condition
precedent to its ability to perform, such approval has been
applied for and has been diligently pursued, and such approval
remains pending and not refused or rejected on such date, then
Savannah or GPC, as the case may be, shall be entitled to a
reasonable extension of the Execution and Delivery in order to
permit Savannah or GPC, as the case may be, to obtain such
pending approval.
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(d) AMENDMENT OF LEASE IN CONNECTION WITH THE CONSTRUCTION
OF ONE OR MORE ADDITIONAL PLANT MCINTOSH CTS.
(i) The obligations of the Participants under this
Section 4(d) are subject to Section 7(c), APPROVALS, hereof.
In the event that GPC serves one or more notices that it
plans to construct one or more of the Additional Plant
McIntosh CTs, Savannah agrees that it will proceed
diligently in accordance with subsections (ii), (iii) and
(iv) of this Section 4(d) to a closing at which time
Savannah and GPC shall amend the Lease in order to convey to
GPC a 100% leasehold interest in the real property
associated with such one or more Additional Plant McIntosh
CTs such that GPC will always hold a 100% leasehold interest
in the GPC Plant McIntosh CTs Site.
(ii) Not more than 30 days following the date GPC
serves each notice that it plans to construct one or more of
the Additional Plant McIntosh CTs, GPC shall deliver to
Savannah a notice specifying the date on which the closing
contemplated in subsection (i) of this Section 4(d) shall
occur (the "closing notice"). Following receipt of each
such closing notice, the Participants shall proceed
diligently to such closing, at which time the closing
described in Section 10(u), OBLIGATION TO CONVEY INTERESTS
IN THE CT COMMON FACILITIES, hereof, shall also be
consummated. At such closing, Savannah and GPC shall
execute an amendment to the Lease, which shall substitute
for Exhibit A of said Lease the revised real property
description of the GPC Plant McIntosh CTs Site, such that
the Lease will convey a 100% leasehold interest in the
additional real property which is a part of such Additional
Plant McIntosh CTs. In connection with such amendment to
the Lease, Savannah shall deliver to GPC a properly executed
Release from the holder of any and all mortgages, deeds to
secure debt or other security interests of such leasehold
interest being conveyed by Savannah to GPC.
(iii) The increase in the Rent paid by GPC for each
conveyance of a leasehold interest pursuant to subsection
(i) of this Section 4(d), shall be the original book cost of
that percentage of the GPC Plant McIntosh CTs Site being
conveyed multiplied by Savannah's weighted cost of pretax
capital as of December 31, 1991.
(iv) From time to time after each closing pursuant to
this Section 4(d), the Participants shall execute and
deliver such other instruments of conveyance and transfer as
may be necessary or appropriate or as either of them may
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reasonably request to vest in GPC the leasehold interest in
that portion of the GPC Plant McIntosh CTs Site being
conveyed at such closing, including without limitation, any
necessary easements appurtenant thereto.
5. AGENCY.
(a) APPOINTMENT. Effective on the date of Execution and
Delivery, subject to the terms of this Agreement and the
Operating Agreement, the Participants hereby irrevocably appoint
Savannah as their Agent in connection with the Plant McIntosh
CTs, the CT Common Facilities and the CT Fuel Supply to act on
behalf of the Participants in performing the Agency Functions.
Savannah hereby accepts such appointment and agrees that it shall
discharge its responsibilities as Agent for the Participants in
accordance with the terms of this Agreement and in accordance
with Prudent Utility Practice.
(b) AUTHORITY AND RESPONSIBILITY. Subject to the
provisions of this Agreement and the Operating Agreement, as
Agent for the Participants, Savannah shall have sole authority
and responsibility with respect to the Agency Functions, and in
respect thereof, Savannah as Agent is authorized to take and
shall take, in the name and on behalf of the Participants all
reasonable actions which, in the discretion and judgment of
Savannah, are deemed necessary or advisable to effect the Agency
Functions, including, without limitation, the following:
(i) The making of such agreements and modifications
of existing agreements, other than this Agreement and the
Operating Agreement, and the taking of such other action as
Savannah as Agent deems necessary or appropriate, in its
sole discretion, or as may be required under the regulations
or directives of any Governmental Authority having
jurisdiction, with respect to the Agency Functions, which
such agreements and modifications shall, together with all
such existing agreements, be held by Savannah as Agent;
provided, however, that Savannah will develop procedures,
with respect to the purchase of equipment and materials and
the supply of services, which are mutually acceptable to the
Participants and which shall provide opportunity for the
Participants to participate in procurement decisions;
(ii) With respect to the disposal (including, without
limitation, retirement and salvaging) of all or any part of
the Plant McIntosh CTs (other than the Savannah Plant
McIntosh CTs), the making of such agreements and
modifications of existing agreements (other than this
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Agreement and the Operating Agreement) and the taking of
such other action as may be required under the regulations
or directives of any Governmental Authority having
jurisdiction or as Savannah as Agent deems necessary or
appropriate, with the consent in each case of the
Participants owning such Plant McIntosh CTs, which such
agreements and modifications, together with such existing
agreements, shall be held by Savannah as Agent; provided,
however, that Savannah shall not be required to obtain the
consent of any Participant prior to disposing of any
machinery, apparatus, supplies, equipment, tools or
implements which are (1) valued at less than $50,000.00
(original book cost), and (2) replaced or substituted for
with similar property of value at least equal to that of the
disposed property; provided, further, that Savannah is not
authorized by GPC to have any direct contact with the GPSC
on behalf of GPC without the written consent of GPC;
(iii) With respect to the disposal (including, without
limitation, retirement and salvaging) of all or any part of
the CT Common Facilities and the CT Fuel Supply, the making
of such agreements and modifications of existing agreements
(other than this Agreement and the Operating Agreement) and
the taking of such other action as may be required under the
regulations or directives of any Governmental Authority
having jurisdiction or as Savannah as Agent deems necessary
or appropriate, with the consent in each case of all the
Participants, which such agreements and modifications,
together with such existing agreements, shall be held by
Savannah as Agent; provided, however, that Savannah shall
not be required to obtain the consent of any Participant
prior to disposing of any machinery, apparatus, supplies,
equipment, tools or implements which are (1) valued at less
than $50,000.00 (original book cost), and (2) replaced or
substituted for with similar property of value at least
equal to that of the disposed property;
(iv) The execution and filing, with any Governmental
Authority having jurisdiction (except the GPSC on behalf of
GPC), of applications, amendments, reports and other
documents and filings in or in connection with the licensing
and other regulatory matters with respect to the Plant
McIntosh CTs, the CT Common Facilities, the CT Fuel Supply
or any combination thereof;
(v) The receipt of any notice or other communication
from any Governmental Authority having jurisdiction (except
the GPSC on behalf of GPC) as to any licensing or other
similar matter with respect to the Plant McIntosh CTs, the
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CT Common Facilities, the CT Fuel Supply or any combination
thereof; and
(vi) The provision of, or contracting with any third
party to purchase or provide, any equipment or facilities or
perform services in connection with the Plant McIntosh CTs,
the CT Common Facilities, or both, in accordance with the
provisions of this Agreement and the Operating Agreement.
GPC and Savannah agree that all such agreements which relate
to the Plant McIntosh CTs, the CT Common Facilities or the CT
Fuel Supply, described in this Section 5(b) which are entered
into after the effective date hereof shall, by their terms, be
made assignable by Savannah as Agent to any replacement or
successor Agent for the Agency Functions, pursuant to this
Agreement and the Operating Agreement; provided, however, that
any agreements between Savannah, as Agent, and its Affiliates
shall not be made assignable to any replacement or successor
Agent who is not also an Affiliate of Savannah.
(c) LIABILITY, REMEDIES AND LIMITATIONS OF LIABILITY.
(i) Notwithstanding any provision of law or any
provision of this Agreement, (A) in the event Savannah as
Agent fails to comply at any time with the provisions of
Section 7(a), NO ADVERSE DISTINCTION, hereof, or (B) in the
event that Savannah fails at any time to perform its duties,
responsibilities, obligations or functions hereunder as
Agent in accordance with Prudent Utility Practice, or (C) in
the event that Savannah conveys all of its undivided
ownership interest in the Plant McIntosh CT Project, then
the Participants shall have the right as their sole and
exclusive remedy to remove Savannah as Agent hereunder and
under the Operating Agreement in accordance with all of the
provisions of subsection (iv) of this Section 5(c).
GPC, in performing services, or acting as agent, for
Savannah in connection with the Plant McIntosh CT Project,
shall have equivalent limitations on its liability as are
set forth above for Savannah, as Agent.
(ii) The limitations upon the liability of Savannah
and the Participants herein shall also apply to the work
performed by Savannah and the Participants prior to the date
hereof and prior to the Execution and Delivery with respect
to the Plant McIntosh CTs, the CT Common Facilities or the
CT Fuel Supply.
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(iii) In the event that any particular application of
any of the limitations of liability contained in this
Section 5(c) should be finally adjudicated to be void as a
violation of the public policy of the State of Georgia, then
such limitation of liability shall not apply with respect to
such application to the extent (but only to the extent)
required in order for such limitation of liability not to be
void as a violation of such public policy, and such
limitations of liability shall remain in full force and
effect with respect to all other applications to the fullest
extent permitted by law.
(iv) The removal and replacement of Savannah as Agent
under this Agreement and under the Operating Agreement
pursuant to any provisions of this Agreement or the
Operating Agreement authorizing such removal and
replacement, shall be conducted in accordance with all of
the following provisions of this Section 5(c)(iv):
(A) The removal of Savannah as Agent under this
Agreement and the Operating Agreement with respect to
the Plant McIntosh CT Project (other than the Savannah
Plant McIntosh CTs) and the appointment of a successor
Agent shall be effected, subject to approval of any
Governmental Authority having jurisdiction, upon
written notice to Savannah executed by the Participant
or Participants owning the Plant McIntosh CT Project
(other than Savannah). Any such notice must identify
the date upon which such removal and appointment shall
be effective, the cause for such removal and the provi-
sions hereof or of the Operating Agreement or both upon
which such removal is based, and either the name of the
successor Agent appointed to replace Savannah as Agent
or the names of two potential successor Agents, one of
whom shall be appointed to replace Savannah as Agent.
In the event such notice of removal identifies two
potential successor Agents, the Participants owning the
Plant McIntosh CT Project (other than Savannah) shall
notify Savannah in writing of the identity of the one
appointed to replace Savannah as Agent forthwith upon
its appointment, which shall occur no later than the
date upon which the removal of Savannah as Agent is to
be effective as set forth in such notice of removal.
(B) Except as provided in the preceding paragraph
(A), Savannah shall have no obligation to continue as
Agent under this Agreement or under the Operating
Agreement from and after the date upon which its
removal as Agent is to be effective as set forth in
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said notice of removal. In addition, from and after
the date upon which such removal of Savannah as Agent
with respect to the Plant McIntosh CT Project (other
than the Savannah Plant McIntosh CTs) is to be
effective as set forth in the notice of removal, the
Participants (other than Savannah) shall indemnify and
hold Savannah harmless from and against any loss, cost
and expense resulting from the failure of the successor
Agent to assume such position on such effective date.
(C) Savannah agrees that it will cooperate with
the successor Agent in facilitating the assumption of
such position by the successor Agent and in generally
familiarizing the successor Agent and its employees and
agents with the Plant McIntosh CTs, the CT Common
Facilities and the CT Fuel Supply and with their
physical orientation and operation.
(d) MANAGEMENT AND CONSTRUCTION AUDITS. Each Participant
shall have the right from time to time to conduct management and
construction audits, at its own cost, of Savannah's performance
as Agent hereunder, either by its own officers and employees or
through its duly authorized agents or representatives. Savannah
shall cooperate with each Participant in conducting any such
audit and, subject to the applicable regulations of any
Governmental Authority having jurisdiction, give each Participant
reasonable access to all contracts, records, and other documents
relating to the Plant McIntosh CTs (other than the Savannah Plant
McIntosh CTs), the CT Common Facilities, the CT Fuel Supply or
any combination thereof.
(e) ON-SITE OBSERVATION AND INSPECTION. Each Participant
shall be entitled to have a reasonable number of Site
Representatives at the Plant McIntosh CT Project, on a full or
part time basis (whether on site or off site), as determined by
each Participant. Reasonable office space and facilities shall
be made available to such Site Representative and the Participant
represented by such Site Representative shall be solely
responsible for the Operating Costs and Cost of Construction, if
construction of such office space is required, for such office
space.
Each Site Representative shall have the right to review
expenditures, audit records, inspect equipment, advise on
procurement, construction and repairs required for equipment,
review the progress of licensing, design, procurement,
construction, testing, startup, outages, review maintenance and
operating practices and otherwise observe all activities
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respecting the Plant McIntosh CTs (other than the Savannah Plant
McIntosh CTs), the CT Common Facilities and the CT Fuel Supply.
(f) INDEMNIFICATION. Except as provided in subsection
(iii) of Section 5(c), LIABILITY, REMEDIES AND LIMITATIONS OF
LIABILITY, hereof, in the event Savannah, in its performance as
Agent hereunder, or any Participant in its capacity as such, or
GPC in performing services, or acting as agent, for Savannah,
incurs any liability to any third party, any reasonable amount
paid by Savannah on account of such liability shall, to the
extent such liability would be classified as Operating Costs
under the Uniform System of Accounts, be considered an Operating
Cost and apportioned between the Participants pursuant to
Sections 5(h), PAYMENT AND SETTLEMENT OF OPERATING COSTS, and
5(g), SHARING OF COSTS - GENERAL, of the Operating Agreement, and
to the extent such liability would be classified as a Cost of
Construction under the Uniform System of Accounts, be considered
a Cost of Construction and apportioned between the Participants
pursuant to Section 6(k), PAYMENTS MADE DURING CONSTRUCTION,
hereof and Sections 5(j), PAYMENT AND SETTLEMENT OF COST OF
CONSTRUCTION, and 5(g), SHARING OF COSTS - GENERAL, of the
Operating Agreement, as appropriate.
(g) AVAILABILITY OF RECORDS. Savannah, as Agent, will at
all times make available to each Participant and its duly
authorized agents and representatives, and each Participant and
its duly authorized agents and representatives may audit all
books and records regarding Cost of Construction sufficiently to
allow it to determine that such costs and expenditures attributed
to the Plant McIntosh CTs (other than the Savannah Plant McIntosh
CTs), the CT Common Facilities, the CT Fuel Supply or any
combination thereof by Savannah, as Agent, pursuant to this
Agreement are appropriate or as needed to satisfy requests from
Governmental Authorities. No payment made pursuant to the
provisions of this Agreement shall constitute a waiver of any
right of a Participant to question or contest the correctness of
any charge or credit by Savannah, as Agent.
(h) RIGHT TO COPIES. Any Participant and any successor
Agent hereunder or under the Operating Agreement shall be
entitled to copy (i) any and all contracts, books, records,
reports and other documents and papers to which such
Participants, their respective officers, employees, duly
authorized agents or representatives and consultants or any
successor Agent is permitted access, or which Savannah has agreed
shall be available for audit, under the terms of this Agreement
or the Operating Agreement, and (ii) any and all planning,
licensing, construction, testing, architectural, engineering and
design drawings and specifications that have been or shall
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hereafter be prepared in connection with the Plant McIntosh CTs,
the CT Common Facilities, the CT Fuel Supply, or any combination
thereof.
(i) PLANT TOURS. Upon prior approval of Savannah (which
approval shall not be unreasonably withheld), any Participant may
schedule plant tours and visits (for individuals other than the
Site Representatives) at the Plant McIntosh CT Project, subject
to the rules and regulations of Governmental Authorities.
(j) BILLING AND ACCOUNTING. Notwithstanding any reference
to Savannah's standard accounting practices contained herein, all
billing and accounting matters, including, without limitation,
payments to be made by the Participants and the Agent, shall be
carried out in a manner consistent with Section 13(b) of the
Public Utility Holding Company Act of 1935, as amended.
(k) PLANT MCINTOSH CT PROJECT MANAGEMENT BOARD. From and
after the date hereof, there is established a Plant McIntosh CT
Project Management Board to supervise, manage and control the
planning, licensing, design, procurement, acquisition,
construction, completion, testing and startup of the Plant
McIntosh CT Project. The Project Management Board shall consist
of two members, and an alternate for each, designated by each of
the Participants and one member and an alternate designated by
SCSI. The Project Management Board shall continue to function
until the last Commercial Operation date of the 1995 Plant
McIntosh CTs substantially as contemplated in that certain
July 25, 1991 letter signed by Savannah, GPC and SCSI and
designating the members of the Project Management Board.
(l) RECORD KEEPING. In furtherance of its duties as
Agent, Savannah shall also keep and maintain appropriate plant
records in accordance with applicable Legal Requirements and
Savannah's record retention policies, and upon request from time
to time by a Participant, Savannah will inform such Participant
of the location of such records and provide access thereto. To
the extent that any Participant would like to retain records for
longer periods of time than Savannah would retain such records,
then, upon written request from such Participant, Savannah shall
provide such Participant, at such Participant's sole expense,
with originals or copies as appropriate of such records on or
prior to the date that Savannah would dispose of such records.
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6. OWNERSHIP, RIGHTS AND OBLIGATIONS.
(a) OWNERSHIP.
(i) The Participants shall own the Plant McIntosh
CTs as follows: (A) GPC shall have sole title to the GPC
Plant McIntosh CTs (other than the GPC Plant McIntosh CTs
Site), and (B) Savannah shall have sole title to the
Savannah Plant McIntosh CTs.
(ii) The Participants shall have title to the CT
Common Facilities (other than the CT Common Facilities Site)
and the CT Fuel Supply, as tenants in common with undivided
ownership interests therein, subject to the terms of this
Agreement and the Operating Agreement, and shall own the
foregoing property and possess rights and obligations
related thereto, including, without limitation, payment
therefor, in the proportions equal to their respective Pro
Forma Ownership Interests as they may appear from time to
time. The Participants shall be entitled to the capacity
and, subject to the Operating Agreement, the associated
energy of each Plant McIntosh CT which they may own from
time to time.
(iii) The Participants shall have the following real
property interests in the Savannah Plant McIntosh CTs Site,
the GPC Plant McIntosh CTs Site and the CT Common Facilities
Site: (A) Savannah shall own fee simple title to the
Savannah Plant McIntosh CTs Site, the GPC Plant McIntosh CTs
Site and the CT Common Facilities Site, subject to the
leasehold interests and easements conveyed by Savannah to
GPC pursuant to the Lease described herein; and (B) GPC
shall have a 100% leasehold interest in the GPC Plant
McIntosh CTs Site and a percentage undivided interest,
equivalent to GPC's Pro Forma Ownership Interest as it may
appear from time to time, in a leasehold estate, as a tenant
in common with Savannah, in the CT Common Facilities Site,
together with the easements appurtenant to such leasehold
estate conveyed by Savannah to GPC pursuant to the Lease
described herein.
(iv) Savannah reserves the right to hold, own, use
and possess the Plant McIntosh Site, less and except
therefrom the GPC Plant McIntosh CTs Site and the CT Common
Facilities Site, but including the Savannah Plant McIntosh
CTs Site, at all times during the term of this Agreement,
the Operating Agreement and the Lease in a manner wholly
consistent with the terms, covenants, agreements and
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provisions of this Agreement, the Operating Agreement and
the Lease.
(b) NONPAYMENT.
(i) Payments due from a Participant hereunder and
payments due from the Agent to a Participant, if any, not
made when due shall bear interest, compounded monthly until
paid, at a rate per annum equal to the lesser of (A) the
highest interest rate allowed by law, or (B) the higher of
(1) a rate five percentage points above the average yield on
the issue of six-month United States Treasury Bills, as
reported by the Federal Reserve Bank of New York, at the
sale of such Treasury Bills by the United States Treasury
next preceding the due date of such payment, or (2) a rate
five percentage points above the highest of the net interest
costs on the most recent issue of bonds or other long-term
obligations by any Participant or the Agent. Such interest
shall accrue and is and shall be expressed in simple
interest terms per annum in accordance with Section 7-4-2(a) of
the Official Code of Georgia Annotated (1989), as amended.
(ii) A nonpaying Participant shall have no right to
any output of capacity and energy of the Plant McIntosh CT
Project or to exercise any other right of a Participant
until all amounts overdue from that Participant have been
paid, together with interest at the rate provided in
subsection (i) of this Section 6(b), into the Construction
Account, Operating Account, the Capital Account or to
another Participant if the latter has paid such overdue
amount on behalf of such nonpaying Participant, as
appropriate. Such overdue amounts, together with such
interest, shall be paid into the Construction Account, the
Operating Account or the Capital Account, as appropriate,
only to the extent that such amounts have not been paid by
another Participant pursuant to the further provisions of
this Section 6(b). Notwithstanding any of the provisions of
this Section 6(b), if Savannah is the nonpaying Participant,
Savannah, as Agent, shall continue to plan, license,
procure, acquire, construct, complete, test, start-up,
manage, control, operate, maintain, renew, add, replace,
modify and dispose of the Plant McIntosh CTs (other than the
Savannah Plant McIntosh CTs), the CT Common Facilities and
the CT Fuel Supply in accordance with the provisions of this
Agreement and the Operating Agreement.
(iii) Any output of capacity and energy of the Plant
McIntosh CTs of any nonpaying Participant may be sold or
utilized by any non-defaulting Participant and Savannah as
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Agent in the manner and upon the terms and conditions set
forth in Section 5(l), NONPAYMENT, of the Operating
Agreement.
(iv) In addition to all other rights of the
Participants pursuant to the foregoing provisions of this
Section 6(b), with respect to the CT Common Facilities, the
other Participant or Participants shall have the right,
subject to the receipt of all requisite regulatory
approvals, but not the obligation, to make any payment of
interest or principal due and owing (A) to Chemical Bank, as
Trustee under GPC's First Mortgage Bonds, or other lender or
trustee, as the case may be, if any, from GPC in respect of
such First Mortgage Bonds, pollution control revenue bonds,
or other bonds or notes for financing GPC's obligations
hereunder, which GPC fails to make when due, or (B) to
NationsBank of Georgia, National Association, as Trustee
under Savannah's Mortgage Bonds, or other lender or trustee,
as the case may be, if any, from Savannah in respect of such
mortgage bonds, pollution control revenue bonds, or other
bonds or notes for financing Savannah's obligations
hereunder, which Savannah fails to make when due, or (C) to
the corresponding lenders or trustees from any other
Participant hereunder in respect of a financing of such
Participant's obligations hereunder, which such Participant
fails to make when due, and in each such case to be promptly
reimbursed in full therefor by GPC, Savannah or such other
Participant, as the case may be, together with interest at
the rate provided in subsection (i) of this Section 6(b).
(v) No remedy referred to in this Section 6(b) is
intended to be exclusive of any other remedy set forth in
this section, but every such remedy herein provided shall be
cumulative and may be exercised from time to time and as
often as may be deemed expedient except where the exercise
of any one of such remedies precludes its further exercise
or the exercise of any other remedy. No delay or failure to
exercise any remedy herein provided shall impair the right
to exercise any such remedy or be construed to be a waiver
of such right or of any default by a Participant or by the
Agent. Notwithstanding the foregoing, the remedies which
are set forth in this Section 6(b) shall constitute the sole
and exclusive remedies of the Participants, legal or
equitable, for the failure of any Participant to make any
payment when due under this Agreement.
(vi) Notwithstanding the other provisions of this
Section 6(b), any Participant who disagrees with or disputes
the amount of any payment claimed by the Agent to be due
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pursuant to this Agreement shall make such payment under
protest and shall be reimbursed, together with all accrued
interest at the Prime Rate from the date of payment to the
date of reimbursement, for any amount charged in error after
the settlement of such disagreement or dispute as provided
in Section 6(k), PAYMENTS MADE DURING CONSTRUCTION, hereof,
and Sections 5(h), PAYMENT AND SETTLEMENT OF OPERATING COSTS
and 5(j), PAYMENT AND SETTLEMENT OF COST OF CONSTRUCTION, of
the Operating Agreement, as appropriate.
(vii) The foregoing provisions of this Section 6(b)
shall not apply to nonpayment of amounts to be paid pursuant
to Section 3, SALE TO GPC OF AN UNDIVIDED OWNERSHIP INTEREST
IN CERTAIN OF THE CT COMMON FACILITIES EQUIPMENT, Section 4,
LEASE TO GPC OF THE GPC PLANT MCINTOSH CTS SITE AND THE CT
COMMON FACILITIES SITE, or Section 10(u), OBLIGATION TO
CONVEY INTERESTS IN THE CT COMMON FACILITIES, hereof.
(c) ALIENATION AND ASSIGNMENT.
(i) Until the earlier of (A) 15 years after the
expiration of the term of the Operating Agreement, or (B) 20
years and 11 months after the death of the last survivor of
the now living lineal descendants of Mrs. Rose F. Kennedy,
mother of the thirty-fifth President of the United States of
America, no Participant shall have the right to sell, lease,
convey, transfer, assign, encumber or alienate in any manner
whatsoever, except as otherwise provided herein, its
ownership or leasehold interests, or any portion or portions
thereof, in the Plant McIntosh CTs, the CT Common
Facilities, or any rights under this Agreement without first
offering, subject to all requisite regulatory approvals,
including, without limitation, the approval of the SEC
pursuant to the Public Utility Holding Company Act of 1935,
such sale, lease or conveyance to GPC, upon the same terms
and conditions as the proposed sale, lease or conveyance to
another party (unless, pursuant to the terms of the Public
Utility Holding Company Act of 1935 and any amendments or
successor legislation thereto, the terms and conditions of
such conveyance are regulated, in which case the terms and
conditions of such conveyance shall not be inconsistent with
such Act), which offer shall be made in the form of a
proposed contract and shall be open for acceptance by GPC
for a period of 60 days for all of the interests being
offered, and in the event such offer is accepted by GPC, the
offering Participant and GPC shall proceed to a closing for
the interests accepted by GPC pursuant to the terms of the
aforesaid contract in an expeditious manner; provided,
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however, that with respect to any proposed sale by GPC of
all or any part of its ownership or leasehold interests in
the Plant McIntosh CTs and the CT Common Facilities,
Savannah shall have a right of first refusal upon the same
terms as set forth above for an offer to GPC.
(ii) In the event none of the offers pursuant to
subsection (i) of this Section 6(c) is accepted, the
offering Participant shall next offer, subject to all
requisite regulatory approvals, including, without
limitation, the approval of the SEC pursuant to the Public
Utility Holding Company Act of 1935, such sale, lease or
other conveyance of the ownership or ownership and leasehold
interests not accepted pursuant to subsection (i) to the
other Participants, if any, (other than GPC or Savannah) pro
rata in accordance with their respective Pro Forma Ownership
Interests, as they may appear at the time, upon the same
terms and conditions as the proposed sale, lease or
conveyance to another party (other than GPC or Savannah),
which offer shall be made in the form of a proposed contract
and shall be open for acceptance by the other Participants
for a period of 60 days, and in the event such offer is
accepted by all of the other Participants, the offering
Participant and all of the other Participants shall proceed
to a closing pursuant to the terms of the aforesaid contract
in an expeditious manner. In the event that there are three
or more Participants and such offer is accepted by one or
more but not by all of the other Participants within the
aforesaid 60-day period, the offering Participant shall
offer such unaccepted portion to such of the other
Participants who have accepted such original offer, and such
other Participants shall have ten Business Days to accept
such offer with respect to such unaccepted portion. In the
event that any of such offers is not timely accepted, the
offering Participant shall be entitled to consummate the
proposed sale, lease or other conveyance to such other
party.
(iii) If the offering Participant does not consummate
the proposed sale, lease or other conveyance of such
interests to the Participant hereof within a period of one
year after the date of its offer pursuant to subsection (i)
or if the offering Participant does not consummate the
proposed sale, lease or other conveyance of such interests
within a period of one year after the date of its offer to
the other Participants, no such sale, lease or other
conveyance may be consummated without re-offering the sale,
lease or conveyance pursuant to subsection (i) and if not
accepted then pursuant to subsection (ii). In no event
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shall the offering Participant sell, lease or convey such
interest to any party (including, without limitation, GPC or
Savannah) which is not financially responsible or do so on
any terms materially different from those set forth in the
aforesaid offer. Each Participant shall notify the other
Participants in writing as soon as possible after it learns
that any lien or security interest in respect of an
obligation or liability in excess of $100,000 (other than a
lien or security interest created by such Participant as
security for bonds or other obligations issued or to be
issued) has been or will be imposed upon its ownership or
leasehold interests in the Plant McIntosh CT Project or any
portion or portions thereof or has reason to believe that
such a lien or security interest will be imposed. In the
event of any sale, lease, conveyance, transfer, assignment
or alienation (other than solely as security for an
indebtedness) by one of the Participants of its ownership or
ownership and leasehold interests in the Plant McIntosh CTs
or any portion or portions thereof such Participant shall
also (A) sell to the transferee thereof and such transferee
shall purchase an equivalent portion of such Participant's
corresponding portion of the CT Common Facilities (other
than the CT Common Facilities site) and an equivalent
portion of such Participant's corresponding portion of the
CT Fuel Supply, and (B) assign the lease (or, in the case of
Savannah, grant a lease) to the transferee thereof to an
equivalent portion of such Participant's corresponding
interest in the CT Common Facilities Site. As a condition
precedent to the consummation of the foregoing transactions,
the transferring Participant shall cause the transferee of
such interests to become a Party to this Agreement and
assume the obligations of the transferor hereunder in
proportion to the interests so sold, leased, conveyed,
transferred, assigned, or alienated, whereupon such
transferee shall be a Participant hereunder. Each
Participant hereby expressly waives and renounces for the
term of the Operating Agreement for itself, its successors,
transferees and assigns, all rights to a partition of the CT
Common Facilities and the CT Fuel Supply and to an
accounting associated therewith.
(iv) Notwithstanding subsections (i), (ii) and (vii)
of this Section 6(c) each Participant shall have the right
to mortgage or to convey a security interest in its
ownership or leasehold interests in the Plant McIntosh CT
Project or any portion or portions thereof as security for
bonds or other obligations issued or to be issued.
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(v) Notwithstanding any other provisions of this
Agreement to the contrary, any Participant shall have the
right to sell, convey, transfer or assign its ownership or
leasehold interests, or any portion or portions thereof, in
the Plant McIntosh CT Project to any governmental or
political subdivision or authority in connection with the
financing of pollution control or solid waste disposal
facilities without the consent of Savannah or the other
Participants and without complying with the provisions of
this Section 6(c). Any provision of this Agreement to the
contrary notwithstanding, no sale, lease, conveyance,
transfer, assignment or alienation whatsoever by Savannah of
any or all of its undivided ownership interest in the Plant
McIntosh CT Project or any portion or portions thereof,
whether as security for an indebtedness, in connection with
the financing of pollution control or solid waste disposal
facilities or otherwise, shall relieve Savannah of its
obligations to act as Agent hereunder and under the
Operating Agreement.
(vi) In the event any Participant sells or conveys to
any party (including, without limitation, GPC or Savannah)
any ownership or ownership and leasehold interests in the
Plant McIntosh CT Project in accordance with the provisions
of subsection (i) or (ii) of this Section 6(c) or pursuant
to any other provisions of this Agreement authorizing such
sale, such Participant's rights and obligations hereunder as
a Participant and co-owner of the CT Common Facilities and
the CT Fuel Supply, including, without limitation, the
obligation to make payments of the Cost of Construction,
Operating Costs and Fuel Costs, shall be reduced to the
extent of the interests so sold, and the other Participants
shall look solely to such purchaser for performance of the
corresponding obligations relating to the interests sold.
(vii) Until the earlier of (A) 15 years after the
expiration of the term of the Operating Agreement, or (B) 20
years and 11 months after the death of the last survivor of
the now living lineal descendants of Mrs. Rose F. Kennedy,
mother of the thirty-fifth President of the United States of
America, Savannah shall not sell, lease, convey, transfer,
assign, encumber or alienate in any manner whatsoever,
except as otherwise provided herein, its ownership interest
in the Plant McIntosh facilities utilized to provide support
services to the Plant McIntosh CT Project, or any portion or
portions thereof, without first offering, subject to all
requisite regulatory approval, including, without
limitation, the SEC pursuant to the Public Utility Holding
Company Act of 1935, such sale, lease or conveyance to GPC,
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upon the same terms and conditions as the proposed sale,
lease or conveyance to another party (unless, pursuant to
the terms of the Public Utility Holding Company Act of 1935,
and any amendments or successor legislation thereto, the
terms and conditions of such conveyance are regulated, in
which case the terms and conditions of such conveyance shall
not be inconsistent with such Act), which offer shall be
made in the form of a proposed contract and shall be open
for acceptance by GPC for a period of 60 days for all of the
interests being offered, and in the event such offer is
accepted by GPC, Savannah and GPC shall proceed to a closing
for the interests accepted by GPC pursuant to the terms of
the aforesaid contract in an expeditious manner.
(viii) If, pursuant to this Section 6(c), any
Participant makes a sale, lease, transfer or assignment of
all or any portion of its ownership or ownership and
leasehold interests in the Plant McIntosh CT Project (other
than solely as security for indebtedness or to facilitate
the financing of pollution control or solid waste disposal
facilities), such Participant shall also assign the
Operating Agreement pro tanto, and shall cause the
transferee to assume to the same extent the rights and
obligations of such Participant thereunder; provided,
however, that Savannah shall not assign its responsibilities
as Agent hereunder without the prior written approval of the
Participants which shall not be unreasonably withheld. Any
attempted or purported assignment of this Agreement not in
compliance with this Section 6(c) shall be null and void and
of no force or effect whatsoever.
(d) DAMAGE OR DESTRUCTION. Subject to the receipt of all
requisite approvals of any Governmental Authority having
jurisdiction:
(i) In the event the CT Common Facilities or any
portion thereof is damaged or destroyed, and the cost of
repairs or reconstruction is estimated to be fully covered
by the aggregate amount of insurance coverage procured and
maintained by the Agent on behalf of the Participants (less
applicable deductibles) covering such repairs or
reconstruction, then, unless Participants owning in the
aggregate more than 51% Pro Forma Ownership Interest in the
Plant McIntosh CT Project determine not to repair or
reconstruct the CT Common Facilities, the CT Common
Facilities shall be repaired or reconstructed.
(ii) In the event the CT Common Facilities or any
portion thereof is damaged or destroyed, and the cost of
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repairs or reconstruction is estimated to be more than the
aggregate amount of insurance coverage procured and
maintained by the Agent on behalf of the Participants (less
applicable deductibles) covering such repairs or
reconstruction, then, unless Participants owning in the
aggregate more than 51% Pro Forma Ownership Interest in the
Plant McIntosh CT Project determine to repair or reconstruct
the CT Common Facilities, the CT Common Facilities shall not
be repaired or reconstructed.
(iii) If as a result of the preceding subsections (i)
and (ii), the CT Common Facilities are not to be repaired or
reconstructed but one or more Participants desire the repair
or reconstruction thereof, the CT Common Facilities shall be
repaired or reconstructed; provided, however, that the
Participants desiring to repair or reconstruct the CT Common
Facilities shall bear the full cost of such repair or
reconstruction (after taking into account available
insurance proceeds of such Participants); and provided
further, that if any other Participant should thereafter
desire to obtain its entitlement of energy from its
respective portion of the Plant McIntosh CT Project but
would not have been able to obtain such entitlement but for
the repairs or reconstruction effected pursuant to this
paragraph (iii), such other Participant shall reimburse the
repairing or reconstructing Participants their pro rata
share of the original book cost of such repairs or
reconstruction less depreciation, which shall include the
cost of capital.
(e) TAXES. To the extent possible, each Participant shall
separately report, file returns with respect to, be responsible
for and pay all real property, franchise, business, or other
taxes or fees (except payroll taxes for Savannah employees and
sales or use taxes for items purchased by Savannah as Agent, and
except to the extent that Savannah and GPC, as subsidiaries of
The Southern Company, file or have filed on their behalf
consolidated income tax returns), arising out of its ownership or
leasehold interests in the Plant McIntosh CT Project; provided,
however, that to the extent that such taxes or fees may be levied
on or assessed against the Plant McIntosh CT Project, its
operation, or the Participants in such a manner so as to make
impossible the carrying out of the foregoing provisions of this
Section 6(e), or upon mutual agreement of the Participants, such
taxes or fees shall be considered a Cost of Construction and paid
from the Construction Account or the Capital Account, as
appropriate, in accordance with the provisions of Section 6(k),
PAYMENTS MADE DURING CONSTRUCTION, hereof, or Section 5(j),
PAYMENT AND SETTLEMENT OF COST OF CONSTRUCTION, of the Operating
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Agreement, but in no event shall any taxes or fees from the
payment of which any Participant is exempt by law be considered a
Cost of Construction. Ad valorem taxes for the year in which the
Execution and Delivery occurs shall be a Cost of Construction and
paid by the Participants in accordance with Section 6(k),
PAYMENTS MADE DURING CONSTRUCTION, hereof. All such prorations
shall be based on estimated taxes and shall be adjusted among the
Participants upon receipt of the actual tax bills. All sales and
transfer taxes, recording and filing fees, if any, incurred in
connection with the conveyance to GPC of (i) any undivided
ownership interest in that portion of the CT Common Facilities
equipment pursuant to Section 3, SALE TO GPC OF AN UNDIVIDED
OWNERSHIP INTEREST IN CERTAIN OF THE CT COMMON FACILITIES
EQUIPMENT, hereof, or (ii) any leasehold interest in the GPC
Plant McIntosh CTs Site and the CT Common Facilities Site,
pursuant to Section 4, LEASE TO GPC OF THE GPC PLANT MCINTOSH CTS
SITE AND THE CT COMMON FACILITIES SITE, hereof, or the conveyance
of any ownership and leasehold interests in the CT Common
Facilities to a Participant pursuant to Section 10(u), OBLIGATION
TO CONVEY INTERESTS IN THE CT COMMON FACILITIES, hereof, shall be
paid by the Participants in proportion to their Pro Forma
Ownership Interests.
(f) INSURANCE. Except as may otherwise be provided in the
Operating Agreement, during the period of its construction and
operation of the Plant McIntosh CT Project, Savannah shall carry
in the name of the Participants, as their interests appear,
insurance covering (i) workers' compensation, which shall include
employers' liability, (ii) commercial general liability, which
shall include broad form contractual and products/completed
operations liability, and (iii) "all risk" property, including
coverage for boiler and machinery, in such amounts and with such
deductible or self-insurance features as is consistent with The
Southern Company's customary practices, provided such insurance
shall have the following minimum limits of liability: (w)
workers' compensation, statutory limits; (x) employers'
liability, $100,000 per accident; (y) commercial general
liability, which shall include broad form contractual and
products/completed operations liability, $50,000,000 combined
single limit per occurrence and (z) "all risk" property
insurance, $200,000,000 per occurrence; or such greater limits as
may be determined, from time to time, by mutual agreement of the
Participants. The maximum aggregate deductible amount under all
insurance policies for any occurrence shall be an amount
consistent with industry practice for utilities of similar size
and exposure, provided that such insurance is obtainable with a
deductible amount not exceeding such maximum deductible amount
and at commercially reasonable premiums. The aggregate cost of
all such insurance shall be considered (i) Cost of Construction
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for any such costs which are incurred with respect to any portion
or portions of the Plant McIntosh CT Project which has not yet
entered Commercial Operation, and (ii) Operating Costs for any
such costs which are incurred with respect to any portion or
portions of the Plant McIntosh CT Project which has entered
Commercial Operation, and shall be paid in accordance with the
provisions of Section 6(k), PAYMENTS MADE DURING CONSTRUCTION,
hereof, or Section 5(h), PAYMENT AND SETTLEMENT OF OPERATING
COSTS, of the Operating Agreement, as appropriate. For any
policy furnished by Savannah, the Participants shall each be
designated as an additional insured (including, without
limitation, for purposes of protecting their interests as owners)
and such policy shall be endorsed to be primary to any insurance
which may be maintained by any Participant.
Each other Participant may also maintain additional or other
insurance, at its own cost and expense, which it deems necessary
or advisable to protect its respective interest in any portion of
the Plant McIntosh CT Project provided that such additional
insurance does not reduce or diminish in any way the coverage of
the insurance procured and maintained by Savannah pursuant to
this Section 6(f).
Notwithstanding the foregoing, such Participant (other than
Savannah) shall separately procure and maintain in force, at its
own expense, workers' compensation and employers' liability
insurance for its Site Representatives and its other employees
visiting the Plant McIntosh CT Project with the minimum limits of
liability set forth above.
(g) RESERVED.
(h) POLLUTION CONTROL AND OTHER FACILITIES. The
Participants and the Agent shall cooperate with each other in any
financing undertaken by a Participant on its own behalf of its
respective interest in certain facilities and equipment located
at the Plant McIntosh CT Project site for the control of
environmental pollution and for such other purposes or facilities
as tax-exempt bonds may be issued from time to time through the
Development Authority of Effingham County, or its successors or
assigns or any other political subdivision or authority, of its
industrial revenue notes or bonds, or both, the interest on which
will be excluded from gross income for Federal income tax
purposes.
(i) NO IMPUTATION OF KNOWLEDGE. Savannah acknowledges
that subsequent to the Execution and Delivery, Savannah, although
acting as Agent for GPC with respect to the Agency Functions,
will not be acting as agent with respect to the conveyance to GPC
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of (i) leasehold interests in the GPC Plant McIntosh CT Site and
the CT Common Facilities Site, and (ii) undivided ownership
interests in those portions of the CT Common Facilities equipment
conveyed to GPC pursuant to this Agreement. Accordingly, GPC
shall not be deemed to have any knowledge imputed to it as a
result of the agency relationship between Savannah and GPC.
(j) CONSTRUCTION BUDGETS AND SCHEDULES.
(i) Within 30 days of the date hereof, Savannah, as
Agent for the Participants in the construction of the Plant
McIntosh CT Project, will deliver to the other Participants
an initial Construction Budget setting forth the amounts
estimated to be expended by the Participants for the Cost of
Construction with respect to each Plant McIntosh CT and the
CT Common Facilities (for which payment is to be made in
accordance with the provisions of Section 6(k), PAYMENTS TO
BE MADE DURING CONSTRUCTION, hereof) and a summary cash flow
setting forth the amounts estimated to be expended, and
which have been expended as of that date, in each month
until the last estimated Commercial Operation date. By
July 1 and January 1 of each year until the last date of
Commercial Operation, Savannah will deliver to the
Participants additional Construction Budget estimates, based
on information reasonably available, supported by detail
reasonably adequate for the purpose of each Participant's
reasonable review thereof. Each such budget estimate shall
include a construction schedule containing a critical path
analysis for the design and construction of each Plant
McIntosh CT, as well as the CT Common Facilities, a plan and
timetable for obtaining the necessary permits, licenses and
approvals from the appropriate Governmental Authorities, the
then current expected dates of Commercial Operation and such
other plans, timetables or schedules, if any, as Savannah
may deem appropriate.
(ii) Within 30 days after receipt of the initial
Construction Budget and, thereafter, by August 1 and
February 1 of each year, respectively, (A) the Construction
Budget and construction schedule for each Participant's
Plant McIntosh CTs shall be approved or disapproved by the
Participant owning such Plant McIntosh CTs, and (B) the
Construction Budget and construction schedule for the CT
Common Facilities shall be approved by mutual agreement of
the Participants, in the absence of which such budget or
schedule, as the case may be, shall be disapproved, in its
entirety. If any Construction Budget or construction
schedule is disapproved, the Participants shall then have
until September 1 and March 1, respectively, to agree on an
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alternative revised Construction Budget or construction
schedule, as the case may be, which shall comply with
Prudent Utility Practice and Legal Requirements. In the
event that the Participants are unable to agree on a
complete revised budget or schedule which complies with
Prudent Utility Practice and Legal Requirements by
September 1 and March 1, respectively, then the budget or
schedule, as the case may be, to be utilized shall consist
only of such portions of the Construction Budget or
construction schedule as revised on which the Participants
agree. The Participants and Savannah, as Agent, agree to
cooperate with one another to revise to the extent
practicable, any Construction Budget or construction
schedule in effect from time to time to accommodate changed
circumstances.
(iii) Savannah, as Agent, shall attempt to construct
the Plant McIntosh CT Project in accordance with the then
current Construction Budget estimate and construction
schedule such that (A) payments to be made by the
Participants for the costs contained therein shall be, as
nearly as practicable, within the then current Construction
Budget and the schedules of expenditures contained therein,
and (B) the Plant McIntosh CTs meet their intended
Commercial Operation dates. Notwithstanding the foregoing,
Savannah makes no representation, warranty or promise of any
kind as to the accuracy of any estimate contained in a
Construction Budget or construction schedule or any
revisions thereto or that any such attempt referred to in
the preceding sentence will be successful, and in no event
shall Savannah, as Agent, have any liability to any of the
Participants in these regards.
(k) PAYMENTS MADE DURING CONSTRUCTION.
(i) Savannah, as Agent, shall be responsible for
making, and shall make, payment to third parties, and such
of the Participants which have rendered services to Savannah
in connection with the Plant McIntosh CT Project, of all
Cost of Construction only to the extent that funds are
available therefor in the Construction Account; provided,
however, that all payments of Cost of Construction made by
Savannah prior to the date hereof shall also be allocated
among and paid by the Participants in accordance with this
Agreement.
(ii) Within 30 days of the date hereof, and
thereafter, on or before the first Business Day of each
month, Savannah, as Agent, will notify the other
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Participants of the nature and amount of all Cost of
Construction expended to date and anticipated to be incurred
during the succeeding calendar month in respect of the
planning, design, licensing, procurement, construction,
acquisition, completion, testing and startup of the Plant
McIntosh CTs or the CT Common Facilities, or both, plus or
minus any adjustments for costs incurred in prior months but
not previously charged or credited to the Participants under
the provisions of this Section 6(k) with separate
computations as to each of the Plant McIntosh CTs and the CT
Common Facilities. Savannah, as Agent, will give each
Participant as much notice as is reasonably practicable of
any major anticipated cost. Each such notification made by
Savannah, as Agent, of anticipated costs and adjustments
shall be accompanied and adjusted by an accounting of costs
incurred and credits, if any, received for preceding months.
Each Participant shall make payment into the Construction
Account in immediately available funds of its respective
percentage share of the Cost of Construction incurred prior
to Commercial Operation in accordance with the provisions of
this Section 6(k) during the succeeding month in accordance
with the schedule determined and delivered to it by
Savannah, as Agent. Each Participant's respective
percentage share of such Cost of Construction shall be
consistent with its respective ownership interests in the
Plant McIntosh CT Project. Each Participant's share of the
Cost of Construction associated with the 1994 Plant McIntosh
CTs shall equal the number of 1994 Plant McIntosh CTs which
such Participant owns divided by the total number of 1994
Plant McIntosh CTs; provided, however, in the event that a
Participant makes unique additions to or delays the
construction of one or more of the 1994 Plant McIntosh CTs,
then each Participant shall pay the Cost of Construction
associated with the 1994 Plant McIntosh CTs which such
Participant owns; provided further that each Participant who
elects to cancel any one or more of the 1994 Plant McIntosh
CTs shall bear all Cost of Construction associated with such
cancelled 1994 Plant McIntosh CTs. Each Participant's share
of the Cost of Construction associated with the 1995 Plant
McIntosh CTs shall equal the number of 1995 Plant McIntosh
CTs which such Participant owns divided by the total number
of the 1995 Plant McIntosh CTs; provided, however, in the
event that a Participant makes unique additions to or delays
the construction of one or more of the 1995 Plant McIntosh
CTs, then each Participant shall pay the Cost of
Construction associated with the 1995 Plant McIntosh CTs
which such Participant owns; provided further that each
Participant who elects to cancel any one or more of the 1995
Plant McIntosh CTs shall bear all Cost of Construction
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associated with such cancelled 1995 Plant McIntosh CTs.
Each Participant's share of the Cost of Construction
associated with the Additional Plant McIntosh CTs shall
equal the number of Additional Plant McIntosh CTs which such
Participant owns divided by the total number of Additional
Plant McIntosh CTs; provided, however, that for purposes of
the calculation in this sentence, no Additional Plant
McIntosh CTs shall be included until such time as one or
more Participants have provided written notice to the other
Participants that such one or more Participants are planning
to construct one or more Additional Plant McIntosh CTs, as
the case may be, in order to meet their energy needs;
provided further in the event that a Participant makes
unique additions to or delays the construction of one or
more of the Additional Plant McIntosh CTs, then each
Participant shall pay the Cost of Construction associated
with the Additional Plant McIntosh CTs which such
Participant owns; and provided further that each Participant
who elects to cancel any one or more of the Additional Plant
McIntosh CTs shall bear all Cost of Construction associated
with such cancelled Additional Plant McIntosh CTs. Each
Participant's share of the Cost of Construction associated
with the CT Common Facilities shall equal such Participant's
Pro Forma Ownership Interest, as it may appear from time to
time; provided, however, that each Participant who elects to
construct one or more of the Additional Plant McIntosh CTs
shall bear all Cost of Construction associated with any
additions to the CT Common Facilities required to support
such Additional Plant McIntosh CTs, subject to the
provisions of Section 10(u) hereof; provided further that
each Participant who elects to cancel the construction of
any Plant McIntosh CT shall bear all Cost of Construction
associated with the CT Common Facilities which, but for the
initial decision to construct such cancelled Plant McIntosh
CT, would not have been expended.
(iii) Each Participant shall have until (A) the 180th
day after the later of (1) the commencement of Commercial
Operation of all of the 1994 Plant McIntosh CTs, with
respect to the 1994 Plant McIntosh CTs, and the commencement
of Commercial Operation of all of the 1995 Plant McIntosh
CTs, with respect to the 1995 Plant McIntosh CTs, and the
commencement of Commercial Operation of each of the
Additional Plant McIntosh CTs, with respect to each
respective Additional Plant McIntosh CT, or (2) the
furnishing of an accounting by Savannah, as Agent, of all
items of the Cost of Construction incurred prior to the
Commercial Operation of one or more of the Plant McIntosh
CTs (but including Cost of Construction attributable only to
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such of the CT Common Facilities as may have been required
for Commercial Operation of such Plant McIntosh CTs), or (B)
such time as the Parties may otherwise agree, to question or
contest the correctness of such charge or credit after which
time the correctness of such charge or credit shall be
conclusively presumed. In the event that any Participant by
timely notice questions or contests the correctness of any
such charge or credit, Savannah, as Agent, shall promptly
review the questioned charge or credit and shall within 55
days following notice from a Participant questioning or
contesting such charge or credit notify each Participant of
the amount of any error and the amount of reimbursement, if
any, that each Participant is required to make or is
entitled to receive in respect of such error. Not later
than the fifth Business Day after receipt of such notice
from Savannah, as Agent, each Participant required to make
reimbursement shall deposit the amount specified in such
notice into the Construction Account in immediately
available funds. Any such reimbursement required to be made
by Savannah, as Agent, shall be so deposited by Savannah, as
Agent, not later than the fifth Business Day after Savannah,
as Agent, notifies the other Participants of the amount of
such reimbursement that it is required to make. From the
amount so deposited, Savannah, as Agent, shall immediately
thereafter distribute the amount that each Participant is
entitled to receive (or if the amount so deposited is
insufficient to reimburse in full all Participants entitled
to receive reimbursement, then Savannah, as Agent, shall
distribute the amount so deposited among the Participants
entitled to receive such reimbursement pro rata in
accordance with each Participant's entitlement to
reimbursement in respect of such error), except that if any
such Participant is then in default in respect of any
payments required to be made under this Agreement or the
Operating Agreement, an amount equal to such defaulting
Participant's share of the amount so deposited with respect
to such reimbursement shall be retained in the Construction
Account and distributed in accordance with the provisions of
Section 6(l), CONSTRUCTION ACCOUNT, hereof. Savannah shall
have no responsibility or liability for the failure of any
Participant (other than itself) to deposit funds as provided
in this Section 6(k).
(iv) Savannah, as Agent, will provide each
Participant with such information as is reasonably required
by such Participant in order to account for payments made
pursuant to this Section 6(k) on such Participant's books.
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(l) CONSTRUCTION ACCOUNT.
(i) Within 30 days of the date hereof, Savannah, as
Agent, shall establish the Construction Account.
Contemporaneously with the establishment of the Construction
Account, Savannah shall transfer to the Construction Account
all moneys which have been delivered to and are held by
Savannah for the payment of Cost of Construction.
Henceforth, all payments (for which provision is made in
Section 6(k), PAYMENTS MADE DURING CONSTRUCTION, hereof) of
Cost of Construction incurred by the Participants shall be
deposited by the Participants in the Construction Account
and unless the Participants shall otherwise agree, Savannah,
as Agent, shall withdraw and apply funds from the
Construction Account only as necessary to pay Cost of
Construction in accordance with the provisions of
Section 6(k), PAYMENTS MADE DURING CONSTRUCTION, hereof. In
the event that during any month the balance in the
Construction Account is insufficient to pay such Cost of
Construction required to be paid that month (other than as a
result of the nonpayment by a Participant of an amount due
from it pursuant to Section 6(k), PAYMENTS MADE DURING
CONSTRUCTION, hereof), Savannah, as Agent, shall promptly so
notify the other Participants by telephone or telecopy of
the amount required to be paid by each Participant and
thereafter promptly confirm the same in writing, together
with a description of the cause of such deficit. Each of
the Participants shall pay its respective share of such
deficit into the Construction Account in immediately
available funds not later than the fifth Business Day after
receipt of such notice from Savannah, as Agent. Savannah
shall have no responsibility or liability to make up any
such deficit out of its own funds in excess of the
proportionate share of such deficit which it owes as a
Participant.
(ii) Until the last Commercial Operation date, each
Participant shall continue to own and maintain its undivided
ownership interest in the Construction Account (other than
amounts, if any, deposited in the Construction Account
pursuant to subsection (iii) of Section 6(k), PAYMENTS MADE
DURING CONSTRUCTION, above, which amounts shall be owned
solely by the Participants to whom such amounts are to be
distributed as provided in such subsection); provided,
however, that Savannah, as Agent, shall have the sole right
and authority to make withdrawals from the Construction
Account; and provided further, that a Participant shall not
own any undivided ownership interest in any amount in the
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Construction Account in respect of interest paid into such
Construction Account by or on behalf of such Participant
pursuant to the provisions of Section 6(b), NONPAYMENT,
hereof, which amount shall, if there is only one other
Participant, be owned entirely by such other Participant and
credited against payments required to be made into such
Construction Account by such other Participant in the
performance of its obligations under this Agreement, and
which amount shall, if there are three or more Participants,
be owned in common by, and credited against payments
required to be made into such Construction Account by, the
other Participants not then in default in the performance of
their obligations under this Agreement in the proportion
which their respective Pro Forma Ownership Interests, as
they may appear at the time, bear to the aggregate of their
Pro Forma Ownership Interests, as they may appear at the
time. Savannah, as Agent, shall not commingle any funds
deposited in the Construction Account with any other funds
owned or maintained by Savannah unless the Participants
shall otherwise agree.
(iii) Upon the last Commercial Operation date of the
1995 Plant McIntosh CTs and settlement of all obligations
relating to Cost of Construction incurred prior to such last
Commercial Operation date, and again upon the last
Commercial Operation date of the Additional Plant McIntosh
CTs and settlement of all obligations relating to Cost of
Construction incurred prior to such last Commercial
Operation date, Savannah, as Agent, shall close the
Construction Account and distribute to each Participant its
undivided ownership interest of any balance remaining in the
Construction Account at such times (exclusive of amounts
therein, if any, in which such Participant shall not own any
undivided ownership interest), except that if a Participant
shall then be in default with respect to any payment
required to be made under this Agreement or under the
Operating Agreement, an amount equal to the liability of
such defaulting Participant on account of such default (or
if such amount exceeds such Participant's share of the
balance in the Construction Account, its entire share of
such balance) shall first be distributed to the non-
defaulting Participant or, if there is more than one non-
defaulting Participant, to the non-defaulting Participants
in the proportion which their respective Pro Forma Ownership
Interests, as they may appear at the time, bear to the
aggregate of their Pro Forma Ownership Interests, as they
may appear at the time.
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(m) SHARING OF COSTS - GENERAL. Except as otherwise
provided in this Agreement, each Participant shall be responsible
for the payment of its respective percentage share of all Cost of
Construction in accordance with this Agreement and the Operating
Agreement.
In the event that (i) the Execution and Delivery does not
take place as contemplated herein, or (ii) the Closing does not
take place as contemplated herein, in the absence of any breach
of this Agreement all Cost of Construction incurred prior to the
date on which either (i) or (ii) of this Section 6(m) occurs
shall be paid by the Participants in accordance with this Section
6(m); provided, however, to the extent that any Participant has
deposited funds into the Construction Account which funds are not
expended by Savannah, as Agent, in accordance with this
Agreement, such funds shall be returned to such Participant.
It is the absolute intent of the Participants to share all
items of cost, obligation and liability incurred in connection
with the Plant McIntosh CT Project (other than the financing of
each Participant's respective ownership or leasehold interests in
the Plant McIntosh CT Project) which are not otherwise expressly
provided for in this Agreement or in the Operating Agreement in
proportion to their respective Pro Forma Ownership Interests, as
they may appear from time to time; provided, however, that any
such cost, obligation or liability incurred at the request of and
for the sole benefit of a particular Participant shall be the
sole responsibility of such Participant and such Participant
hereby agrees to indemnify all other Participants against any
claims, costs, damages, expenses, losses or any other liability
of any kind arising from such costs, obligations or liability.
Notwithstanding the foregoing provisions of this
Section 6(m) or any other provision of this Agreement, in the
event any Participant sells or leases to any other person
(including, without limitation, a Participant) any ownership or
ownership and leasehold interests in the Plant McIntosh CT
Project in accordance with the provisions of Section 6(c),
ALIENATION AND ASSIGNMENT, hereof, (other than a sale or
conveyance as security for an indebtedness or in connection with
the financing of pollution control or solid waste disposal
facilities), such conveying Participant's rights and obligations
hereunder as a Participant, including, without limitation, the
obligation to make payments of Cost of Construction and any other
costs to be shared by the Participants hereunder, shall be
reduced to the extent of the ownership or ownership and leasehold
interests so conveyed, and the Agent and all Participants shall
look solely to such purchaser for payment of the corresponding
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portion of the Cost of Construction and other costs to be shared
by the Participants hereunder.
7. CERTAIN ADDITIONAL AGREEMENTS AMONG THE PARTICIPANTS.
Savannah, as Agent, and the Participants hereby mutually covenant
and agree as follows:
(a) NO ADVERSE DISTINCTION. Notwithstanding any other
provision of this Agreement, in discharging their respective
responsibilities pursuant to this Agreement, neither Savannah as
Agent, or as a Participant, nor any other Participant, shall make
any adverse distinction between that portion of the Plant
McIntosh CT Project in which it has an interest, and any other
portion of the Plant McIntosh CT Project, because of its
ownership of (or ownership and leasehold interests in) a portion
of the Plant McIntosh CTs or an undivided share of the CT Common
Facilities with the other Participants.
(b) COOPERATION. The Participants and Savannah, as Agent,
will cooperate with each other in all activities relating to the
Plant McIntosh CT Project, including, without limitation, the
execution and filing of applications for authorizations, permits
and licenses with Governmental Authorities having jurisdiction
(except that Savannah is not authorized to have any contact with
the GPSC on behalf of GPC without the written consent of GPC),
fuel procurement and the execution of such other documents as may
be reasonably necessary to carry out the provisions of this
Agreement. Without Savannah's written consent, no other
Participant shall incur any obligation in connection with the
Plant McIntosh CT Project which would or could obligate Savannah
to any third party.
(c) APPROVALS. Following the execution and delivery of
this Agreement, GPC and Savannah shall use their reasonable best
efforts to obtain as quickly as possible all requisite and
contemplated judicial, governmental, regulatory and vendor (with
regard to assignment of contractual rights and obligations, if
any) approvals for the consummation of the transactions
contemplated hereby. The obligations of any Participant to
consummate any transaction contemplated by Section 10(u),
OBLIGATION TO CONVEY INTERESTS IN THE CT COMMON FACILITIES,
hereof is subject to the receipt of all requisite approvals of
Governmental Authorities.
(d) COMPLIANCE WITH LAWS AND ENVIRONMENTAL MATTERS.
(i) The Participants acknowledge and agree that
Savannah, as Agent, shall plan, design, license, procure,
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construct, acquire, complete, test, startup, manage,
control, operate, maintain, add to, renew, modify, replace
and dispose of the Plant McIntosh CT Project substantially
in accordance with all local, state and federal laws,
regulations, ordinances or orders now or hereinafter in
effect; provided, however, that any failure to substantially
comply with such local, state or federal laws, regulations,
ordinances or orders shall not be deemed a breach of this
Agreement if, and so long as, such failure is (A) caused by
a Force Majeure Event, or (B) in accordance with a court
order or decree, or a formal agreement with the regulatory
agency having jurisdiction over the subject matter of
noncompliance or having authority to issue the required
approval.
(ii) Each Participant, in addition to the Agent,
shall be a permittee for any air quality permit(s) issued
for such Participant's Plant McIntosh CTs by a Governmental
Authority if such Governmental Authority determines that the
Participants are required to be joint permittees.
(iii) The Agent shall not use, treat, store, dispose,
or recycle, at the Plant McIntosh CT Project any
Environmental Material (as hereinafter defined) in amounts
or under circumstances requiring notification of, or a
permit, license, or approval from any Governmental Authority
of competent jurisdiction, unless such Environmental
Material was generated at the Plant McIntosh CT Project or
related to the generation of electric power at the Plant
McIntosh CT Project. For purposes of this subsection (iii)
of Section 7(d), "Environmental Material" shall mean and
include asbestos, radioactive material, petroleum, petroleum
products, petroleum fractions, petroleum distillates, and
any substance, material or waste designated as hazardous
under the Comprehensive Environmental Response,
Compensation, and Liability Act and amendments thereto, or
designated as toxic or hazardous or otherwise regulated
under the Toxic Substances Control Act and amendments
thereto, the Resource Conservation and Recovery Act and
amendments thereto, the Clean Water Act and amendments
thereto, the Clean Air Act and amendments thereto, the
Georgia Air Quality Act and amendments thereto, the Georgia
Hazardous Waste Management Act and amendments thereto, or
the Georgia Water Quality Control Act and amendments
thereto.
(e) SAFETY. The Participants acknowledge and agree that
in the acquisition, construction and completion of the Plant
McIntosh CT Project, Savannah shall at all times take all
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reasonable precautions for the safety of employees on the work
site and of the public, and shall comply with all applicable
provisions of federal, state, and municipal safety laws and
building and construction codes, including, without limitation,
all regulations of the Occupational Safety and Health
Administration. The requirements of this paragraph shall be for
the sole benefit of the Participants only and shall not create or
impose any standard of care or duty to any third party or to any
employee or subcontractor's employee or to the public, beyond the
duty incumbent upon Savannah which would exist under applicable
law without reference to any term or provision of this Agreement.
(f) EQUAL EMPLOYMENT OPPORTUNITY AND CIVIL RIGHTS.
Savannah, as Agent, shall conform to the requirements of the
Equal Employment Opportunity clause in Section 202, Paragraphs 1
through 7 of Executive Order 11246, as amended, and applicable
portions of Executive Orders 11701 and 11758, relative to Equal
Employment Opportunity and the Implementing Rules and Regulations
of the Office of Federal Contract Compliance Programs.
8. CONDITIONS PRECEDENT TO EXECUTION AND DELIVERY.
(a) SAVANNAH'S CONDITIONS. Except as may otherwise be
provided in Section 6(m), SHARING OF COSTS - GENERAL, hereof, all
obligations of Savannah to GPC under this Agreement and the
Operating Agreement are subject to the fulfillment, prior to or
at the Execution and Delivery, of each of the conditions
contained in clauses (i) through (iv) below (or the waiver in
writing of such conditions by Savannah):
(i) Representations and Warranties Correct;
Performance by GPC. GPC's representations and warranties
contained in this Agreement shall have been materially true
and correct at the date hereof, and (other than the
representation and warranty set forth in subsection (iii) of
Section 2(a), GPC REPRESENTATIONS AND WARRANTIES, hereof)
shall be deemed to have been made again at and as of the
time of the Execution and Delivery and shall then be true
and correct in all material respects; GPC shall have
performed and complied with all agreements, covenants and
conditions required by this Agreement to be performed or
complied with by it prior to or at the Execution and
Delivery; and Savannah shall have been furnished with a
certificate of the President or a vice president of GPC,
dated the date of the Execution and Delivery, certifying in
such detail as Savannah may request to the fulfillment of
the foregoing conditions.
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(ii) Litigation Certificate. GPC shall have
delivered to Savannah a certificate executed by the
President or a vice president of GPC that, as of the time of
the Execution and Delivery, such officer of GPC has no
personal knowledge of actual or threatened litigation
against GPC which might materially adversely affect the
rights of Savannah as a tenant in common in the CT Common
Facilities and the CT Fuel Supply other than such pending or
threatened litigation described or referred to in such
certificate, and the contents of such certificate shall be
reasonably satisfactory to Savannah.
(iii) Other Documents. At or prior to the time of the
Execution and Delivery, GPC shall have entered into the
Operating Agreement and such Operating Agreement shall be in
full force and effect. At the Execution and Delivery, GPC
shall not be in material breach of the Operating Agreement.
(iv) Opinion of GPC's Counsel. Savannah shall have
been furnished with an opinion of Troutman Sanders, counsel
for GPC, dated the date of the Execution and Delivery, to
the effect that:
(A) GPC is a corporation duly organized, validly
existing and in good standing under the laws of the
State of Georgia and has the requisite power and
authority to own and to lease those portions of the
Plant McIntosh CT Project as GPC is required to own and
lease following the Execution and Delivery, to execute
and deliver this Agreement and the Operating Agreement
and to perform its obligations hereunder and
thereunder, and to conduct its business as it is then
being conducted;
(B) the execution, delivery and performance of
this Agreement and the Operating Agreement by GPC have
been duly and effectively authorized by all requisite
corporate action; and
(C) GPC had full power and authority to execute
this Agreement and the Operating Agreement, and this
Agreement and the Operating Agreement have been fully
executed and delivered by GPC and are the legal, valid
and binding obligations of GPC enforceable against it
in accordance with their terms (except as the
provisions hereof or thereof may be limited by
bankruptcy, insolvency, reorganization or other laws
relating to or affecting the enforcement of creditors'
rights and by other laws of general application
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affecting the rights and remedies of creditors, except
that the availability of the remedy of specific
enforcement or of injunctive relief is subject to the
discretion of the court before which any proceeding
therefor may be brought, and except that no opinion
shall be expressed as to the validity and
enforceability of the restrictions on alienation set
forth in Sections 6(c), ALIENATION AND ASSIGNMENT
hereof).
Such opinion shall cover such other matters as Savannah
may reasonably request and shall be reasonably satisfactory
to Savannah's counsel.
(b) GPC'S CONDITIONS. Except as may otherwise be provided
in Section 6(m), SHARING OF COSTS - GENERAL, hereof, all
obligations of GPC under this Agreement and the Operating
Agreement are subject to the fulfillment, prior to or at the
Execution and Delivery, of each of the following conditions (or
the waiver in writing of such conditions by GPC):
(i) Representations and Warranties Correct;
Performance by Savannah. Savannah's representations and
warranties contained in this Agreement shall have been
materially true and correct at the date hereof and (other
than the representation and warranty set forth in subsection
(iii) of Section 2(b), SAVANNAH REPRESENTATIONS AND
WARRANTIES hereof) shall be deemed to have been made again
at and as of the time of the Execution and Delivery and
shall then be true and correct in all material respects;
Savannah shall have performed and complied with all
agreements, covenants and conditions required by this
Agreement to be performed or complied with by it prior to or
at the Execution and Delivery; and GPC shall have been
furnished with a certificate of the President or a vice
president of Savannah, dated the date of the Execution and
Delivery, certifying in such detail as GPC may request to
the fulfillment of the foregoing conditions.
(ii) Litigation Certificate. Savannah shall have
delivered to GPC a certificate executed by the President or
a vice president of Savannah that, as of the time of the
Execution and Delivery, such officer of Savannah has no
personal knowledge of actual or threatened litigation
against Savannah which might materially adversely affect the
rights of GPC as a tenant in common in the CT Common
Facilities and the CT Fuel Supply other than such pending or
threatened litigation described or referred to in such
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certificate, and the contents of such certificate shall be
reasonably satisfactory to GPC.
(iii) Collateral Documents. At or prior to the time
of the Execution and Delivery, Savannah shall have entered
into the Collateral Documents and such Collateral Documents
shall be in full force and effect. At the Execution and
Delivery, neither Savannah nor SCSI shall be in material
breach of any of the Collateral Documents.
(iv) Title Insurance. GPC shall have received, at
its own expense, at the Execution and Delivery an owner's
policy of title insurance in favor of GPC containing no
exceptions other than those exceptions set forth on Exhibit
G attached hereto and incorporated herein by reference
(hereinafter referred to as the "Permitted Exceptions"),
insuring GPC's leasehold estate in the real property being
demised to GPC at the Execution and Delivery. Savannah
shall have provided to GPC, or its title insurer, a
corporate officer's affidavit, dated the date of such
Execution and Delivery and executed by a vice president of
Savannah, covering such matters as may be reasonable and
customary in transactions involving commercial real property
in the State of Georgia.
(v) No Material Change. Between the date of this
Agreement and the Execution and Delivery, there shall not
have been any material adverse change in any portion of the
GPC Plant McIntosh CTs Site or the CT Common Facilities Site
that is being leased by GPC at the Execution and Delivery
and such assets shall not have suffered any material loss by
fire, explosion or other casualty.
(vi) Opinion of Savannah's Counsel. GPC shall have
been furnished with an opinion of Bouhan, Williams & Levy,
counsel for Savannah, dated the date of the Execution and
Delivery, to the effect that:
(A) Savannah is a corporation duly organized,
validly existing and in good standing under the laws of
the State of Georgia and has the requisite power and
authority to execute and deliver this Agreement and the
Collateral Documents and to perform its obligations
hereunder and thereunder, and to conduct its business
as it is then being conducted;
(B) the execution, delivery and performance of
this Agreement and the Collateral Documents by Savannah
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have been duly and effectively authorized by all
requisite corporate action; and
(C) Savannah had full power and authority to
execute this Agreement and the Collateral Documents,
and this Agreement and the Collateral Documents have
been fully executed and delivered by Savannah and are
the legal, valid and binding obligations of Savannah
enforceable against it in accordance with their terms
(except as the provisions hereof or thereof may be
limited by bankruptcy, insolvency, reorganization or
other laws relating to or affecting the enforcement of
creditors' rights and by other laws of general
application affecting the rights and remedies of
creditors, except that the availability of the remedy
of specific enforcement or of injunctive relief is
subject to the discretion of the court before which any
proceeding therefor may be brought, and except that no
opinion shall be expressed as to the validity and
enforceability of the restrictions on alienation set
forth in Sections 6(c), ALIENATION AND ASSIGNMENT
hereof).
Such opinion shall cover other matters as GPC may
reasonably request and shall be reasonably satisfactory
to GPC's counsel.
(vii) Due Diligence Satisfactory. GPC shall have had
adequate opportunity to conduct Due Diligence and in the
course thereof shall not have discovered any information,
state of facts, condition or event which, in the exercise of
reasonable judgment, causes GPC to determine that (i) it
would be materially deprived of the value of the bargain
intended to be obtained thereby on the date hereof, or (ii)
that consummation of the Execution and Delivery would
subject GPC to any claims, liabilities, or obligations
estimated to be, singly or in the aggregate, in excess of
$50,000.00 over and above all amounts which Savannah has
otherwise agreed to pay to GPC with respect to such claims,
liabilities, or obligations.
(c) MUTUAL CONDITIONS. Except as may otherwise be
provided in Section 6(m), SHARING OF COSTS - GENERAL, hereof, the
respective obligations of GPC and Savannah under this Agreement
and the Operating Agreement are subject to the fulfillment, prior
to or at the Execution and Delivery (unless waived in writing by
GPC and Savannah prior to or at the Execution and Delivery), of
the further conditions that the following shall have been
achieved: (i) the receipt of all requisite or contemplated
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governmental, regulatory, judicial or other authorizations,
consents, orders, permits, licenses, certifications, filings,
waivers or approvals with respect to such Execution and Delivery
(including, without limitation, those of the GPSC, the SEC, the
GEPD, the Army Corps of Engineers, or Effingham County), (ii) the
execution, delivery and performance (to the extent required prior
to or at the Execution and Delivery) of this Agreement and the
Collateral Documents and the consummation of the transactions
contemplated thereby by GPC and Savannah (including, without
limitation, the substitution of land surveys for Exhibits A1/2,
A3/4, A5/6 and A7/8 pursuant to Sections 1(an), PLANT MCINTOSH
CTS NOS. 01 AND 02, 1(ao), PLANT MCINTOSH CTS NOS. 03 AND 04,
1(ap), PLANT MCINTOSH CTS NOS. 05 AND 06, and 1(aq), PLANT
MCINTOSH CTS NOS. 07 AND 08, hereof), and (iii) the receipt of
the Release by NationsBank of Georgia, National Association, as
Trustee under the Indenture of the leasehold estate to be
conveyed to GPC at the Execution and Delivery hereunder from the
lien of such Indenture.
9. CONDITIONS PRECEDENT TO CLOSING.
(a) SAVANNAH'S CONDITIONS. Except as may otherwise be
provided in Section 6(m), SHARING OF COSTS - GENERAL, hereof, all
obligations of Savannah to GPC under this Agreement and the
Operating Agreement are subject to the fulfillment, prior to or
at the Closing, of each of the conditions contained in clauses
(i) through (iv) below (or the waiver in writing of such
conditions by Savannah):
(i) Representations and Warranties Correct;
Performance by GPC. GPC's representations and warranties
contained in this Agreement shall have been materially true
and correct at the date hereof, and (other than the
representation and warranty set forth in subsection (iii) of
Section 2(a), GPC REPRESENTATIONS AND WARRANTIES, hereof)
shall be deemed to have been made again at and as of the
time of the Closing and shall then be true and correct in
all material respects; GPC shall have performed and complied
with all agreements, covenants and conditions required by
this Agreement to be performed or complied with by it prior
to or at the Closing; and Savannah shall have been furnished
with a certificate of the President or a vice president of
GPC, dated the date of the Closing, certifying in such
detail as Savannah may request to the fulfillment of the
foregoing conditions.
(ii) Litigation Certificate. GPC shall have
delivered to Savannah a certificate executed by the
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President or a vice president of GPC that, as of the time of
the Closing, such officer of GPC has no personal knowledge
of actual or threatened litigation against GPC which might
materially adversely affect the rights of Savannah as a
tenant in common in the CT Common Facilities and the CT Fuel
Supply other than such pending or threatened litigation
described or referred to in such certificate, and the
contents of such certificate shall be reasonably
satisfactory to Savannah.
(iii) Other Documents. At or prior to the time of the
Closing, GPC shall have entered into the Operating Agreement
and such Operating Agreement shall be in full force and
effect. At the Closing, GPC shall not be in material breach
of the Operating Agreement.
(iv) Opinion of GPC's Counsel. Savannah shall have
been furnished with an opinion of Troutman Sanders, counsel
for GPC, dated the date of the Closing, to the effect that:
(A) GPC is a corporation duly organized, validly
existing and in good standing under the laws of the
State of Georgia and has the requisite power and
authority to own and to lease those portions of the
Plant McIntosh CT Project as GPC is required to own and
lease following the Closing, to execute and deliver
this Agreement and the Operating Agreement and to
perform its obligations hereunder and thereunder, and
to conduct its business as it is then being conducted;
(B) the execution, delivery and performance of
this Agreement and the Operating Agreement by GPC have
been duly and effectively authorized by all requisite
corporate action; and
(C) GPC had full power and authority to execute
this Agreement and the Operating Agreement, and this
Agreement and the Operating Agreement have been fully
executed and delivered by GPC and are the legal, valid
and binding obligations of GPC enforceable against it
in accordance with their terms (except as the
provisions hereof or thereof may be limited by
bankruptcy, insolvency, reorganization or other laws
relating to or affecting the enforcement of creditors'
rights and by other laws of general application
affecting the rights and remedies of creditors, except
that the availability of the remedy of specific
enforcement or of injunctive relief is subject to the
discretion of the court before which any proceeding
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therefor may be brought, and except that no opinion
shall be expressed as to the validity and
enforceability of the restrictions on alienation set
forth in Sections 6(c), ALIENATION AND ASSIGNMENT
hereof).
Such opinion shall cover such other matters as Savannah
may reasonably request and shall be reasonably satisfactory
to Savannah's counsel.
(b) GPC'S CONDITIONS. Except as may otherwise be provided
in Section 6(m), SHARING OF COSTS - GENERAL, hereof, all
obligations of GPC under this Agreement and the Operating
Agreement are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions (or the waiver in
writing of such conditions by GPC):
(i) Representations and Warranties Correct;
Performance by Savannah. Savannah's representations and
warranties contained in this Agreement shall have been
materially true and correct at the date hereof and (other
than the representation and warranty set forth in subsection
(iii) of Section 2(b), SAVANNAH REPRESENTATIONS AND
WARRANTIES hereof) shall be deemed to have been made again
at and as of the time of the Closing and shall then be true
and correct in all material respects; Savannah shall have
performed and complied with all agreements, covenants and
conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing; and GPC
shall have been furnished with a certificate of the
President or a vice president of Savannah, dated the date of
the Closing, certifying in such detail as GPC may request to
the fulfillment of the foregoing conditions.
(ii) Litigation Certificate. Savannah shall have
delivered to GPC a certificate executed by the President or
a vice president of Savannah that, as of the time of the
Closing, such officer of Savannah has no personal knowledge
of actual or threatened litigation against Savannah which
might materially adversely affect the rights of GPC as a
tenant in common in the CT Common Facilities and the CT Fuel
Supply other than such pending or threatened litigation
described or referred to in such certificate, and the
contents of such certificate shall be reasonably
satisfactory to GPC.
(iii) Collateral Documents. At or prior to the time
of the Closing, Savannah shall have entered into the
Collateral Documents and such Collateral Documents shall be
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in full force and effect. At the Closing, neither Savannah
nor SCSI shall be in material breach of any of the
Collateral Documents.
(iv) No Material Change. Between the date of this
Agreement and the Closing, there shall not have been any
material adverse change in any of that portion of the CT
Common Facilities equipment being conveyed to GPC at the
Closing and such assets shall not have suffered any material
loss by fire, explosion or other casualty.
(v) Opinion of Savannah's Counsel. GPC shall have
been furnished with an opinion of Bouhan, Williams & Levy,
counsel for Savannah, dated the date of the Closing, to the
effect that:
(A) Savannah is a corporation duly organized,
validly existing and in good standing under the laws of
the State of Georgia and has the requisite power and
authority to execute and deliver this Agreement and the
Collateral Documents and to perform its obligations
hereunder and thereunder, and to conduct its business
as it is then being conducted;
(B) the execution, delivery and performance of
this Agreement and the Collateral Documents by Savannah
have been duly and effectively authorized by all
requisite corporate action; and
(C) Savannah had full power and authority to
execute this Agreement and the Collateral Documents,
and this Agreement and the Collateral Documents have
been fully executed and delivered by Savannah and are
the legal, valid and binding obligations of Savannah
enforceable against it in accordance with their terms
(except as the provisions hereof or thereof may be
limited by bankruptcy, insolvency, reorganization or
other laws relating to or affecting the enforcement of
creditors' rights and by other laws of general
application affecting the rights and remedies of
creditors, except that the availability of the remedy
of specific enforcement or of injunctive relief is
subject to the discretion of the court before which any
proceeding therefor may be brought, and except that no
opinion shall be expressed as to the validity and
enforceability of the restrictions on alienation set
forth in Sections 6(c), ALIENATION AND ASSIGNMENT
hereof).
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Such opinion shall cover other matters as GPC may
reasonably request and shall be reasonably satisfactory
to GPC's counsel.
(vi) Due Diligence Satisfactory. GPC shall have had
adequate opportunity to conduct Due Diligence and in the
course thereof shall not have discovered any information,
state of facts, condition or event which, in the exercise of
reasonable judgment, causes GPC to determine that (i) it
would be materially deprived of the value of the bargain
intended to be obtained thereby on the date hereof, or (ii)
that consummation of the Closing would subject GPC to any
claims, liabilities, or obligations estimated to be, singly
or in the aggregate, in excess of $50,000.00 over and above
all amounts which Savannah has otherwise agreed to pay to
GPC with respect to such claims, liabilities, or
obligations.
(c) MUTUAL CONDITIONS. Except as may otherwise be
provided in Section 6(m), SHARING OF COSTS - GENERAL, hereof, the
respective obligations of GPC and Savannah under this Agreement
and the Operating Agreement are subject to the fulfillment, prior
to or at the Closing (unless waived in writing by GPC and
Savannah prior to or at the Closing), of the further conditions
that the following shall have been achieved: (i) the receipt of
all requisite or contemplated governmental, regulatory, judicial
or other authorizations, consents, orders, permits, licenses,
certifications, filings, waivers or approvals with respect to
such Closing (including, without limitation, those of the FERC,
GPSC, the SEC, the GEPD, the Army Corps of Engineers, or
Effingham County), (ii) the execution, delivery and performance
(to the extent required prior to or at the Closing) of this
Agreement and the Collateral Documents and the consummation of
the transactions contemplated thereby by GPC and Savannah, and
(iii) the receipt of the Release by NationsBank of Georgia,
National Association, as Trustee under the Indenture of the
undivided ownership interest in that portion of the CT Common
Facilities equipment to be conveyed to GPC at the Closing
hereunder from the lien of such Indenture.
10. MISCELLANEOUS.
(a) SURVIVAL. The agreements, covenants, representations
and warranties contained in Sections 1, DEFINITIONS, 2,
REPRESENTATIONS AND WARRANTIES, 3, SALE TO GPC OF AN UNDIVIDED
OWNERSHIP INTEREST IN CERTAIN OF THE CT COMMON FACILITIES
EQUIPMENT, 4, LEASE TO GPC OF THE PLANT MCINTOSH CTS SITE AND THE
CT COMMON FACILITIES SITE, 5, AGENCY, 6, OWNERSHIP, RIGHTS AND
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OBLIGATIONS, 7, CERTAIN ADDITIONAL AGREEMENTS AMONG THE
PARTICIPANTS, and 10, MISCELLANEOUS, of this Agreement shall
survive the Closing; provided, however, that such agreements,
covenants, representations and warranties shall remain in effect
only so long as the Operating Agreement remains in effect,
pursuant to Section 7(b), TERM, of the Operating Agreement.
(b) FURTHER ASSURANCES. From time to time after the date
hereof, each Party will execute and deliver such instruments of
conveyance and other documents, upon the request of another
Party, as may be necessary or appropriate to carry out the intent
of this Agreement.
(c) GOVERNING LAW. The validity, interpretation, and
performance of this Agreement and each of its provisions shall be
governed by the laws of the State of Georgia.
(d) NOTICE.
(i) Any notice, request, consent or other
communication permitted or required by this Agreement
(including, without limitation, any offer or acceptance
pursuant to Section 6(c), ALIENATION AND ASSIGNMENT, hereof)
shall be in writing. All notices pertaining to or affecting
the provisions of this Agreement shall be deemed given when
deposited in the United States Mail, and sent by registered
or certified mail to the Parties at the following addresses:
GPC:
Georgia Power Company
333 Piedmont Avenue
Atlanta, Georgia 30308
Attention: Senior Vice President - Bulk Power Markets
Telephone Number: (404) 526-6599
Telecopy Number: (404) 526-7407
Savannah (in its capacity as a Participant and as Agent):
Savannah Electric and Power Company
600 East Bay Street
Savannah, Georgia 31402
Attention: Vice President - Operations
Telephone Number: (912) 238-2250
Telecopy Number: (912) 944-1378
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(ii) Any Party shall be entitled to specify a
different officer or address upon notice in writing to the
other Parties.
(e) SECTION HEADINGS NOT TO AFFECT MEANING. The
descriptive headings of the various sections of this Agreement
have been inserted for convenience of reference only and shall in
no way modify or restrict any of the terms and provisions hereof.
(f) NO PARTNERSHIP. Notwithstanding any provision of this
Agreement, none of the Parties intend to create hereby any joint
venture, partnership, association taxable as a corporation, or
other entity for the conduct of any business for profit either
among themselves or with any one or more of the Participants.
(g) TIME OF ESSENCE. Time is of the essence of this
Agreement.
(h) AMENDMENTS. This Agreement may be amended by and only
by a written instrument duly executed by each of the Parties.
(i) SUCCESSORS AND ASSIGNS. This Agreement shall inure to
the benefit of and be binding upon each of the Parties and their
respective successors and upon their assigns pursuant to the
provisions of Section 6(c), ALIENATION AND ASSIGNMENT, hereof.
Nothing in this Agreement, express or implied, is intended to
confer upon any other person any rights or remedies hereunder,
except that any transferee of an ownership or ownership and
leasehold interest in the Plant McIntosh CT Project or any
portion or portions thereof, from any Participant in accordance
with this Agreement and pursuant to an agreement under which the
other Participants have been made third-party beneficiaries of
such transferee's obligations thereunder shall be a third-party
beneficiary of such other Participants' respective obligations
hereunder and shall be deemed a Participant for all purposes of
this Agreement.
(j) COUNTERPARTS. This Agreement may be executed
simultaneously 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.
(k) "AS IS" SALE. EXCEPT AND TO THE EXTENT AS OTHERWISE
EXPRESSLY SET FORTH HEREIN OR IN ANY BILL OF SALE TO BE DELIVERED
PURSUANT TO THIS AGREEMENT: (A) ANY PORTION OF THE CT COMMON
FACILITIES EQUIPMENT TO BE CONVEYED HEREUNDER SHALL BE SOLD "AS
IS" AND "WHERE IS"; (B) NEITHER GPC NOR SAVANNAH MAKES ANY
REPRESENTATION OR WARRANTY WHATSOEVER IN THIS AGREEMENT, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY
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REPRESENTATION OR WARRANTY AS TO THE VALUE, QUANTITY, CONDITION,
SALABILITY, OBSOLESCENCE, MERCHANTABILITY, FITNESS OR SUITABILITY
FOR USE OR WORKING ORDER OF ANY PORTION OF THE CT COMMON
FACILITIES EQUIPMENT TO BE CONVEYED HEREUNDER; AND (C) NEITHER
GPC NOR SAVANNAH REPRESENT OR WARRANT THAT THE USE OR OPERATION
OF ANY PORTION OF THE CT COMMON FACILITIES EQUIPMENT CONVEYED
HEREUNDER WILL NOT VIOLATE PATENT, TRADEMARK OR SERVICE MARK
RIGHTS OF ANY THIRD PARTIES. GPC AND SAVANNAH ARE WILLING TO
PURCHASE THOSE PORTIONS OF THE CT COMMON FACILITIES EQUIPMENT
CONVEYED HEREUNDER "AS IS" AND "WHERE IS" SUBJECT TO AND IN
ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT.
Notwithstanding the foregoing, GPC and Savannah shall have the
benefit, consistent with their ownership and leasehold interests
in the Plant McIntosh CT Project, of all manufacturers' and
vendors' warranties and all patent, trademark and service mark
rights running to GPC and Savannah, respectively, in connection
with the Plant McIntosh CT Project.
(l) COMPUTATION OF PERCENTAGE UNDIVIDED OWNERSHIP
INTEREST. Notwithstanding any other provision of this Agreement,
whenever, pursuant to any provision of this Agreement, any action
is required to be agreed to or taken by any one or more of the
Participants hereunder (other than any action to be taken by
Savannah in its capacity as Agent hereunder), (i) only those
Participants not in default in the payment of any amounts
(together with interest, if appropriate) required under any
provisions of this Agreement or the Operating Agreement at the
time such action is to be agreed to or taken shall have the right
to participate in such agreement or the taking of such action,
and (ii) the computation of the aggregate Pro Forma Ownership
Interest in the Plant McIntosh CT Project of the Participants
agreeing to or taking any such action shall be based solely upon
the Pro Forma Ownership Interests in the Plant McIntosh CT
Project of the Participants not so in default.
(m) SUCCESSOR AGENT. In the event that Savannah (or any
successor Agent) is removed as Agent for the Participants
hereunder or under the Operating Agreement or in the event
Savannah (with prior written approval from the Participants which
shall not be unreasonably withheld) assigns its responsibilities
as Agent, any successor Agent for the Participants as
contemplated hereby shall exercise all of the rights and powers
and shall be subject to all of the duties and obligations of
Savannah as Agent hereunder or under the Operating Agreement and
shall be subject to removal by the Participants in the same
manner as Savannah, and Savannah shall take all action and
execute (and file where appropriate) all documents and
instruments which shall be requested by the successor Agent to
effect the transfer to such successor Agent of such rights,
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powers, duties and obligations, including, but not limited to,
taking such actions and executing such documents and instruments
necessary to enable the successor Agent to operate and maintain
those facilities and equipment of Plant McIntosh owned by
Savannah which provide support services to the Plant McIntosh CT
Project.
(n) THE PLANT MCINTOSH CT UNITS. In the event that at any
time the same party shall not serve as Agent with respect to all
the Plant McIntosh CTs, Participants mutually agree (and agree to
exercise their reasonable best efforts to obtain the agreement of
any other Agent), if any or more than one of them is an Agent
with respect to any of the Plant McIntosh CTs, to exercise the
rights, powers, duties and obligations of an Agent hereunder and
under the Operating Agreement in such a manner as will not
unreasonably interfere with the rights of any Participant under
this Agreement or the Operating Agreement.
(o) INSPECTION PRIOR TO EXECUTION AND DELIVERY AND PRIOR
TO CLOSING. Prior to the Execution and Delivery, GPC shall have
the right to inspect the GPC Plant McIntosh CTs Site and the CT
Common Facilities Site and prior to the Closing GPC shall have
the right to inspect that portion of the CT Common Facilities
equipment to be conveyed to GPC at the Closing. During such
inspections, GPC may take pictures for the purpose of determining
the inventory of personal property located at the CT Common
Facilities Site and for such other purposes as may be reasonably
requested by GPC in connection with the Execution and Delivery
and the Closing and the consummation of the transactions contem-
plated hereby.
(p) CONTINUING DUE DILIGENCE.
(i) From the date hereof and until the consummation of
the Execution and Delivery, GPC shall, in addition to any other
rights conferred otherwise hereunder or under the Operating
Agreement, be entitled to conduct such reasonable review of the
GPC Plant McIntosh CTs Site and the CT Common Facilities Site as
it may reasonably deem appropriate.
(ii) From the date hereof and until the consummation of
the Closing, GPC shall, in addition to any other rights conferred
otherwise hereunder or under the Operating Agreement, be entitled
to conduct such reasonable review of that portion of the CT
Common Facilities equipment being conveyed to GPC at the Closing
as it may reasonably deem appropriate.
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(iii) The reviews described in subsections (i) and (ii)
of this Section 10(p) shall be collectively referred to herein as
"Due Diligence."
(q) SEVERAL AGREEMENTS. The agreements and obligations of
the Participants set forth in this Agreement shall be the
several, and not joint, agreements and obligations of the
Participants.
(r) SPECIAL PROVISIONS RELATING TO THE CT COMMON
FACILITIES.
(i) The CT Common Facilities shall be used for the
mutual benefit and enjoyment of the Participants and in such
a manner as will not unreasonably interfere with the use,
benefit and enjoyment of any Participant. No area of the CT
Common Facilities may be used exclusively by less than all
the Participants without the approval of all Participants;
provided, however, that if such use is essential to the
operation of any of the Plant McIntosh CTs, such approval
will not be unreasonably withheld.
(ii) For purposes of the various provisions of this
Agreement and of the Operating Agreement permitting or
requiring the vote, consent, concurrence or approval of the
Participants owning a designated percentage undivided
ownership interest in the Plant McIntosh CT Project, the
Plant McIntosh CTs or the CT Common Facilities, a
Participant's percentage undivided ownership interest in the
Plant McIntosh CT Project, the Plant McIntosh CTs or the CT
Common Facilities at any particular time shall be deemed to
be equivalent to that Participant's Pro Forma Ownership
Interest at such time.
(s) CONSTRUCTION OF "INCLUDING". Wherever the term
"including" is used in this Agreement, such term shall not be
construed as limiting the generality of any statement, clause,
phrase or term and shall not be deemed to exclude any person or
thing otherwise within the meaning of the statement, clause,
phrase or term which it modifies.
(t) NO DELAY. No disagreement or dispute of any kind
between or among any of the Participants concerning any matter,
including, without limitation, the amount of any payment due from
any Participant or the correctness of any charge made to any
Participant, shall permit any Participant to delay or withhold
any payment pursuant to this Agreement.
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(u) OBLIGATION TO CONVEY INTERESTS IN THE CT COMMON
FACILITIES.
(i) The obligations of Participants under this
Section 10(u) are subject to Section 7(c), APPROVALS,
hereof. In the event that any one or more Participants
serve notice that they plan to construct one or more of the
Additional Plant McIntosh CTs, each Participant agrees that
it shall proceed diligently to a closing in accordance with
subsections (ii), (iii), (iv) and (v) of this Section 10(u)
to effect (A) a sale and purchase of such percentage
ownership interest in the CT Common Facilities (other than
the CT Common Facilities Site) as is necessary to adjust
each Participant's percentage ownership interest in the CT
Common Facilities (other than the CT Common Facilities Site)
to a percentage equivalent to each Participant's respective
Pro Forma Ownership Interest, and (B) an amendment to the
Lease so as to adjust GPC's leasehold interest in the CT
Common Facilities Site to a percentage equivalent to GPC's
Pro Forma Ownership Interest.
(ii) Not more than 30 days following the date any
Participant serves a notice that such Participant plans to
construct one or more of the Additional Plant McIntosh CTs,
each Participant owning such Additional Plant McIntosh CTs,
shall deliver to the other Participants notices specifying
the date on which the closing described in subsection (i) of
this Section 10(u) shall occur. Following receipt of each
such notice, each Participant shall proceed diligently to
such closing, which, if GPC is serving such notice, shall
coincide with the respective closing described in Section
4(d), AMENDMENT TO LEASE IN CONNECTION WITH THE CONSTRUCTION
OF ONE OR MORE ADDITIONAL PLANT MCINTOSH CTS, hereof. At
such closing, there shall be delivered to GPC or to
Savannah, as the case may be, (A) a bill of sale, with
respect to the sale described in subsection (i)(A) of this
Section 10(u), equivalent in form to Exhibit D of this
Agreement, and (B) an amendment to the Lease, with respect
to the conveyance of the leasehold interest described in
subsection (i)(B) of this Section 10(u), with a term
commensurate with the term of the Lease described in Section
4(a), LEASE OF LAND, hereof. At such closing, there shall
also be delivered to GPC or to Savannah, as the case may be,
a properly executed Release of that portion of the CT Common
Facilities being conveyed from the holder of any and all
mortgages, deeds to secure debt or other security interests
in such undivided ownership interests and leasehold
interests.
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(iii) The purchase price for each conveyance of a
percentage undivided ownership interest in the CT Common
Facilities (other than the CT Common Facilities Site)
pursuant to subsection (i)(A) of this Section 10(u), shall
be book value. Such purchase price shall be payable at the
closing in immediately available funds.
(iv) The reduction or increase in the Rent paid by
GPC, as the case may be, for each conveyance of a leasehold
interest in the CT Common Facilities Site pursuant to
subsection (i)(B) of this Section 10(u), shall be the
original book cost of that percentage of the CT Common
Facilities Site being conveyed multiplied by Savannah's
weighted cost of pretax capital as of December 31, 1991.
(v) From time to time after each closing pursuant to
this Section 10(u), the Participants shall execute and
deliver such other instruments of conveyance and transfer as
may be necessary or appropriate or as any of them may
reasonably request to vest the percentage undivided
ownership interest and leasehold interest in the CT Common
Facilities being conveyed at such closing, including without
limitation, any necessary easements appurtenant thereto.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the undersigned Parties hereto have duly
executed this Agreement under seal as of the date first above
written.
Signed, sealed and delivered GEORGIA POWER COMPANY, as a
in the presence of: Participant
___________________________ By: ________________________
___________________________ Attest: ____________________
Notary Public
(CORPORATE SEAL)
Signed, sealed and delivered SAVANNAH ELECTRIC AND
in the presence of: POWER COMPANY, as Agent
and as a Participant
___________________________ By: _________________________
___________________________ Attest: _____________________
Notary Public
(CORPORATE SEAL)
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