Exhibit 4.14-b
EXECUTION COPY
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COMPANY LEASE AGREEMENT
Between
KEYSPAN-PORT JEFFERSON
ENERGY CENTER, LLC
and
SUFFOLK COUNTY
INDUSTRIAL DEVELOPMENT AGENCY
Dated as of November 1, 2003
$75,000,000
Suffolk County Industrial Development Agency
Industrial Development Revenue Bonds
(KeySpan-Port Jefferson Energy Center, LLC)
Series 2003A
Affecting the Facility located at the
Facility Realty described in Appendix A hereto in
the Town of Brookhaven, Village of Port
Jefferson, County of Suffolk
and State of New York
WINSTON & STRAWN LLP
200 Park Avenue
New York, New York 10166
Attention: William F. Dudine, Esq.
File No. 81326.09
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COMPANY LEASE AGREEMENT
THIS COMPANY LEASE AGREEMENT, dated as of November 1, 2003 (this "Company
Lease"), by and between KEYSPAN-PORT JEFFERSON ENERGY CENTER, LLC, a limited
liability company organized and existing under and by virtue of the laws of the
State of Delaware, having its principal office at c/o KeySpan Corporation, One
MetroTech Center, Brooklyn, New York 11201, party of the first part (the
"Company"), and SUFFOLK COUNTY INDUSTRIAL DEVELOPMENT AGENCY, Hauppauge, New
York, a corporate governmental agency constituting a body corporate and politic
and a public benefit corporation duly organized and existing under the laws of
the State of New York (the "Agency"), having its principal office at H. Lee
Dennison Building, 100 Veterans Memorial Highway, Hauppauge, New York 11788,
party of the second part (the "Agency") (capitalized terms used in the recitals
to and within this Company Lease and not otherwise defined herein shall have the
respective meanings assigned to such terms in the Indenture referred to below):
W I T N E S S E T H:
WHEREAS, the New York State Industrial Development Agency Act, constituting
Title 1 of Article 18-A of the General Municipal Law, Chapter 24 of the
Consolidated Laws of New York, as amended (the "Enabling Act") has been
heretofore enacted by the Legislature of the State of New York for the purposes,
among others, of providing for the creation of industrial development agencies
in the several counties, cities, villages and towns in the State of New York, to
promote, develop, encourage, assist and advance the job opportunities, health,
general prosperity and economic welfare of the people of the State of New York
and to improve their prosperity and standard of living; and
WHEREAS, the Agency has been heretofore established under said Enabling Act
pursuant to Chapter 675 of the 1975 Laws of New York, as amended (together with
the Enabling Act, the "Act"), and is authorized to acquire real property and
interests therein, buildings and other improvements thereon and machinery and
equipment in connection therewith for the purposes set forth above, and to lease
the same as herein more particularly described; and
WHEREAS, the Agency is further authorized by the Act to issue its
industrial development revenue bonds payable solely from and secured by the
revenues derived from the leasing of the land, buildings and other improvements
and the machinery and equipment so acquired; and
WHEREAS, the Company and KeySpan have entered into negotiations with the
Agency in connection with a "project" as such term is defined in the Act (the
"Project") consisting of the refinancing of certain costs incurred by the
Company in connection with the acquisition and construction of an approximately
5,390 square foot building and the acquisition and installation therein of two
single cycle generating units to be used by the Company for the purpose of
providing an aggregate of approximately 79 megawatts to the existing Long Island
electric grid (the "Facility"); and
WHEREAS, the Facility is located on an existing 1.5 acre site known as The
Port Jefferson Energy Center, and located on the western shore of Port Jefferson
Harbor at the terminus of Beach Street (approximately 0.5 miles north of West
Broadway), in the Town of Brookhaven, in the Village of Port Jefferson (the
"Facility Realty") as more particularly described in Appendix A hereto; and
WHEREAS, the Agency has determined that Agency financing assistance is
necessary to provide employment in, and is beneficial for the economy and
prosperity of, the inhabitants of Suffolk County and is reasonably necessary to
induce the Company to proceed with the Project; and
WHEREAS, as a result of such negotiations, the Company has requested the
Agency to issue its bonds in the aggregate principal amount of $75,000,000 to
finance a portion of the costs of the Project; and
WHEREAS, the Agency adopted a bond resolution on November 20, 2003,
authorizing the Project and the issuance of its industrial development revenue
bonds to finance a portion of the costs of the Project, the leasing of the
Facility to the Agency and the subleasing of the Facility to the Company (the
"Bond Resolution"); and
WHEREAS, contemporaneously with the execution of this Company Lease, the
Agency and the Company have entered into a Lease Agreement of even date herewith
(herein referred to as the "Lease Agreement"), providing for the financing of a
portion of the costs of the Project by the Agency and the leasing of the
Facility to the Company; and
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and representations hereinafter contained, the Company and the Agency
hereby agree as follows:
ARTICLE 1.
The Company hereby leases to the Agency, and the Agency hereby leases from
the Company, the Facility described in Appendix A hereto, including all
improvements thereto and equipment now or hereafter located therein but
excluding the Lessee's Property as defined in the Lease Agreement, for the term
herein provided and for use as provided in the Lease Agreement. It is the
intention of the Company and the Agency that the Agency shall have a leasehold
interest in all improvements hereafter constructed by the Company at the
Facility (other than the Lessee's Property) as and when the same are constructed
thereon. Accordingly, the Company and the Agency agree that the Agency shall
hold leasehold title to all improvements hereafter constructed by the Company at
the Facility, together with all equipment used or procured for use in connection
therewith (other than the Lessee's Property).
ARTICLE 2.
The term of this Company Lease shall commence on the date of original
issuance of the Bonds and expire on the earlier of (i) the date the Bonds shall
have been paid in full in accordance with Article X of the Indenture or (ii) the
termination of the Lease Agreement.
ARTICLE 3.
The rental hereunder shall be one dollar ($1), receipt of which is hereby
acknowledged by the Company.
ARTICLE 4.
The Company hereby delivers possession of the Facility to the Agency.
ARTICLE 5.
The Company represents and warrants that it owns fee title to the Facility
and has full right and lawful authority to enter into this Company Lease for the
full term hereof, that the execution, delivery and performance by the Company of
this Company Lease and the consummation of the transactions herein contemplated
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have been duly authorized by all requisite corporate action on the part of the
Company and will not violate (i) any applicable provision of law, or any order
of any court or agency of government having jurisdiction thereover, (ii) the
articles of organization or operating agreement of the Company, or (iii) any
indenture, agreement or other instrument to which the Company is a party or
which it or any of its property is subject to or bound by, or be in conflict
with or result in a breach of or constitute (with due notice and/or lapse of
time) a default under any such material indenture, agreement or other
instrument, which violation, conflict, breach or default would have a material
adverse effect upon the affairs, assets, properties, business or financial
condition of the Company. The Company covenants and agrees that, so long as the
Lease Agreement shall be in full force and effect, the Agency shall have, hold
and enjoy a valid leasehold estate in the Facility, and the Company shall
whenever necessary take all necessary action to that end.
ARTICLE 6.
The Agency represents and warrants that it has full right and lawful
authority to enter into this Company Lease for the full term hereof.
ARTICLE 7.
Except as otherwise permitted by Sections 6.1 or 9.3 of the Lease
Agreement, neither the Agency nor the Company shall (i) assign or transfer this
Company Lease, nor sublease the whole or any part of the Facility nor subject
this Company Lease to any lien, claim, mortgage, encumbrance or servitude other
than Permitted Encumbrances, in any manner, nor (ii) sell, assign, convey or
otherwise dispose of the Facility or any part thereof (other than a release of a
portion of the Facility pursuant to Section 6.4 of the Lease Agreement), during
the term of this Company Lease, in any manner, to any Person, except that the
Agency shall (y) assign its interest hereunder to the Trustee as contemplated by
the Indenture and (z) sublease the Facility to the Company pursuant to the Lease
Agreement for a term not greater than the term herein provided and the Company
may sell, sublease or otherwise dispose of all or portions of the Facility in
accordance with the Lease Agreement.
ARTICLE 8.
Except for the Security Documents, this Company Lease contains the entire
agreement between the parties hereto with respect to the subject matter hereof
and all prior negotiations and agreements are merged in this Company Lease. This
Company Lease may not be changed, modified or discharged in whole or in part and
no oral or executory agreement shall be effective to change, modify or discharge
in whole or in part this Company Lease or any obligations under this Company
Lease, unless such agreement is set forth in a written instrument executed by
the Company and the Agency. No consent or approval of the Company shall be
deemed to have been given or to be effective for any purposes unless such
consent or approval is set forth in a written instrument executed by the
Company. No consent or approval of the Agency shall be deemed to have been given
or to be effective for any purposes unless such consent or approval is set forth
in a written instrument executed by the Agency.
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ARTICLE 9.
All notices required to be given or authorized to be given by any party
pursuant to this Company Lease shall be in writing and shall be served
personally or sent by hand delivery or overnight delivery by a national courier
service, addressed as follows:
If to the Agency: Suffolk County Industrial Development Agency
H. Lee Dennison Building
100 Veterans Memorial Highway
Hauppauge, New York 11788
Attention: Administrative Director
If to the Company: KeySpan-Port Jefferson Energy Center, LLC
c/o KeySpan Corporation
One MetroTech Center
Brooklyn, New York 11201
Attention: Treasurer (with a copy to
the General Counsel at the same address)
The Agency and the Company may, by like notice, designate any further or
different addresses to which subsequent notices shall be sent. A copy of any
notice given to the Agency or the Company under this Company Lease shall also be
given to the Trustee at the address indicated in Section 13.03 in the Indenture.
All notices, certificates and other communications hereunder shall be deemed
given on the date such notices, certificates or other communication are served
personally or sent, if sent by hand delivery, or on the following Business Day,
if sent by overnight delivery.
ARTICLE 10.
THIS COMPANY LEASE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE PRINCIPLES OF
THE CONFLICTS OF LAWS THEREOF.
The terms of this Company Lease are and shall be binding upon and inure to
the benefit of the Agency and the Company and their respective successors and
assigns.
If any one or more of the provisions of this Company Lease shall be ruled
invalid by any court of competent jurisdiction, the invalidity of such
provisions(s) shall not affect any of the remaining provisions hereof, but this
Company Lease shall be construed and enforced as if such illegal or invalid
provision had not been contained herein.
ARTICLE 11.
This Company Lease shall become effective upon the date of the original
issuance of the Bonds. It may be simultaneously executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
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ARTICLE 12.
All covenants, stipulations, promises, agreements and obligations of the
Agency or the Company, as applicable, contained in this Company Lease shall be
deemed to be the covenants, stipulations, promises, agreements and obligations
of the Agency and the Company, as the case may be, and not of any member,
director, officer, employee or agent of the Agency or the Company in his or her
individual capacity, and no recourse shall be had for the payment of any amounts
hereunder against any member, director, officer, employee or agent of the Agency
or the Company. In addition, in the performance of the agreements of the Agency
herein contained, any obligation it may incur for the payment of money shall not
subject the Agency to any pecuniary or other liability nor create a debt of the
State of New York or of the County of Suffolk and neither the State of New York
nor the County of Suffolk shall be liable on any obligation so incurred, but any
such obligation shall be payable solely out of the lease rentals, revenues and
receipts derived from or in connection with the Facility and payable to the
Agency by the Company under the Lease Agreement.
ARTICLE 13.
The Agency and the Company agree that this Company Lease or a memorandum
hereof shall be recorded by the Agency in the appropriate office of the Register
of Suffolk County.
ARTICLE 14.
The use of the Facility and all other rights, duties, liabilities and
obligations of the Company and the Agency with respect thereto and the Project
to be constructed, leased and operated and the financing thereof, not fixed in
this Company Lease, shall be as set forth in the Lease Agreement.
ARTICLE 15.
The Company, in compliance with Section 13 of the Lien Law, covenants that
the Company will receive the consideration for this conveyance and will hold the
right to receive such consideration in a manner consistent with Section 13 of
the Lien Law.
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IN WITNESS WHEREOF, the Company has caused its corporate name to be
subscribed hereto by its Authorized Representative and the Agency has caused its
name to be hereunto subscribed by its duly authorized Chairperson, Vice
Chairperson, Executive Director or Administrative Director, all being done as of
the year and day first above written.
KEYSPAN-PORT JEFFERSON ENERGY CENTER, LLC
By: /s/
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Michael Nilsen
Vice President and Treasurer
SUFFOLK COUNTY INDUSTRIAL
DEVELOPMENT AGENCY
By: /s/
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Bruce E. Ferguson
Administrative Director
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APPENDIX A
DESCRIPTION OF FACILITY
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The Facility means the refinancing and reimbursing of certain costs
incurred by the Lessee in connection with the acquisition and construction of an
approximately 5,390 square foot building and the acquisition and installation
therein of two single cycle generating units to be used by the Lessee for the
purpose of providing an aggregate of approximately 79 megawatts to the existing
Long Island electric grid.
Said building and generating units are located on that certain lot, piece
and parcel of land described in the legal description attached hereto.