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(1) RIDGEWOOD ROC II 2003 LLC
(4) THE PROJECT COMPANIES within
mentioned
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SECOND ROC PROJECT
DEVELOPMENT AND SERVICES AGREEMENT
relating to the development of
electricity
generation plants on behalf of
the
Project Companies
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EVERSHEDS
LLP
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115 Colmore Row
Birmingham
B3 3AL
Tel: +44 121 232 1000
Fax: +44 121 232 1900
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CONTENTS
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Section
1
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Section
2
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Section
3
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Development of
New Projects
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Section
4
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Ownership and
Operation of New Projects
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Section
5
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Operations,
Repair and Maintenance of New Projects
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Section
6
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Section
7
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Section
8
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Section
9
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Joint and
Several Obligations
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Section
10
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Section
11
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Assignment and
Delegation
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Section
12
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Release,
Adherence & Accession
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Section
13
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Section
14
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Section
15
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Relationship of
the Parties
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Section
16
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Section
17
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Section
18
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Section
19
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Section
20
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Section
21
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Schedules
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1
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2
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Developer
Services to be carried out
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3
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4
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Deed of
Release, Adherence and Accession
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THIS
AGREEMENT is
made the day of 2004
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RIDGEWOOD ROC II 2003 LLC,
a Delaware limited liability company
trading in the U.K. whose registered
address is situate at 947 Linwood Avenue, Ridgewood, NJ, 07450, USA
(the " Developer "); and
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CLPE
ROC-2 LIMITED a
company incorporated in England and Wales with company number
05040534 whose registered office is Units 14 & 15 Queensbrook,
Bolton Technology Exchange, Spa Road, Bolton BL1 4AY (the "
Bank Agent ");
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CLPE
ROC-2A LIMITED a
company incorporated in England and Wales with company number
05188043 whose registered office is Units 14 & 15 Queensbrook,
Bolton Technology Exchange, Spa Road, Bolton BL1 4AY (the "
Non Bank
Agent ");
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THOSE
COMPANIES brief
details of which are set out in Schedule 1 hereto
(the " Project Companies " and each a "
Project Company ").
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(A)
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The Bank
Companies (as defined below) and the Bank Agent are all direct or
indirect wholly owned subsidiaries of CLPE Projects 2 Limited
(“Projects 2”) and the Non Bank Companies (as defined
below) and the Non Bank Agent are all members of the CLP
group.
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(i) owns an operating electricity generating plant
that uses landfill gas extracted from a landfill site pursuant to
an existing NFFO Power Purchase Agreement; or
(ii) has committed to build an electricity generating
plant at a site in order that it may sell the output of the plant
under an existing NFFO Power Purchase Agreement; or
(iii) neither owns nor has committed to build
electricity generating plant pursuant to a NFFO Power Purchase
Agreement but has rights to a landfill site from which landfill gas
may be extracted
(and in the
case of each of (i) and (ii) above such existing or proposed
electricity generating plants including their associated gas
extraction, collection, burning and handling equipment,
transformers, switchgear and other associated plant, machinery
infrastructure equipment and apparatus from time to time shall be
hereinafter referred to as an “Existing
Project”).
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(C)
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Each Project
Company with an Existing Project is desirous of adding additional
generating capacity and additional infrastructure improvements at
its Site so that such Project Company might use the surplus
landfill gas to generate additional electricity and each Project
Company with no Existing Project is desirous of constructing,
developing and operating electricity generating equipment at its
Site in order to generate new electricity (in each case a
“New Project”), such electricity to be sold, along with
its environmental attributes, to one or more third parties pursuant
to new electricity sales agreements (“Subsequent Electricity
Sales Agreements”).
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(D)
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Each of the
Project Companies does not currently have available sufficient
financial resources to undertake the development and operation of a
New Project, and each of them has requested that the Developer fund
the New Project using monies provided by the Powerbank II Fund and
undertake the following services and activities as described
herein:
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to use
commercially reasonable efforts to construct, install and
commission a New Project at the Site for the benefit of the Project
Company as described herein; including, without limitation, the
services set forth on Schedule 2 hereto
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after
Commissioning of the New Project, to use commercially reasonable
efforts to arrange for the operation and maintenance services
necessary for the ongoing operation of the New Project,
and
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after
Commissioning of the New Project, to use commercially reasonable
efforts to perform the marketing services necessary to arrange for
the sale of electricity and environmental attributes produced by
the New Project under a Subsequent Electricity Sales Agreement for
the benefit of the relevant Project Company.
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(E)
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The Developer
is prepared to undertake all such services and activities
(“Developer Services”) requested by the Project
Companies in respect of the New Projects on the terms and
conditions set forth herein, including, specifically, compensation
set forth in Section 8 below.
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(F)
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The Bank Agent
and the Non Bank Agent have been established for the purpose of
coordinating the activities of each of the Bank Companies and Non
Bank Companies respectively in connection with the New Projects;
including, without limitation, the performance on behalf of each of
the relevant Project Companies of all of their respective
obligations hereunder, as well as the performance of the agent
services more fully described on Schedule 3 hereof
(the “Agent Services”).
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NOW THEREFORE,
the parties agrees as follows:
In this
Agreement and the Schedules hereto the following words and
expressions shall, unless the context otherwise requires or is
inconsistent therewith, have the following meanings:
“Agent”
means either of the Bank Agent or
the Non Bank Agent acting in its agent capacity pursuant to the
terms of this Agreement and “Agents” shall be construed
accordingly;
“Bank
Company”
means those Project Companies (as
at the date of this Agreement listed in Part 1 of Schedule
1 ) which are a party or become a party to this Agreement
in accordance with Section 12 and
which are direct or indirect subsidiaries of Projects 2;
" Commissioning
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means the stage at which the
installation of the Equipment at the relevant Project Company Site
has been completed and the New Project has been consistently (over
a period of 7 days) exporting electricity to the National Grid and
Commissioned shall have the appropriate meaning;
“ Equipment
” means
in relation to any New Project, the electricity generating
facilities installed (separate from and in addition to such
electricity generating facilities installed or to be installed in
relation to an Existing Project) on a relevant Site by the
Developer in accordance with the terms of this
Agreement;
“Facility
Agreement”
means the amended and restated
facility agreement dated on or around the date of this Agreement
between (inter alios) Projects 2 as borrower, certain of the
Project Companies, the Bank Agent and Bank of Scotland, and
includes all restatements amendments and variations thereof and
supplements thereto from time to time in force;
an
" Insolvency Event
" means
any of the following events:-
the Agent is
deemed unable to pay its debts in accordance with Section 123(1)(b)
or (c) or (2) of the Insolvency Act 1986 or becomes unable
generally pay its debts as they fall due, or otherwise becomes or
is declared insolvent, or suspends making payments (whether of
principal or interest) with respect to all or any class of its
debts or announces an intention to do so; or
an application for an administration order in
relation to the Agent is presented to the court or in the case of
the Bank Agent, any meeting of any Debtor Party (as defined in the
Facility Agreement) is convened for the purpose of considering any
resolution to present an application for such an order;
or
any steps are taken with a view to proposing
(under any enactment or otherwise) any kind of composition, scheme
of arrangement, compromise or arrangement involving the Agent and
its creditors generally (or any class of them); or
any administrative or other receiver or any
manager of the Agent or any of its property is appointed or the
directors of the Agent request any person to appoint such a
receiver or manager; or
any steps are taken to repossess any goods in
the Agent’s possession under any hire purchase, conditional
sale, chattel leasing, retention or title or similar agreement or
any steps are taken with a view to putting or effecting in force
any kind of attachment, sequestration, distress, arrestment or
execution (except in all cases where any such steps:-
(a) give rise to a claim or potential liability
of less than £50,000 and the claim or
liability or being contested in good faith; or
(b) are otherwise discharged within thirty
days after being levied, enforced or sued
out),
against the Agent or any of its property;
or
any meeting of the Agent is convened for the
purpose of considering any resolution for (or to petition for) its
winding up, the Agent passes such a resolution, or the Agent or any
other person presents any petition for the Agent’s winding
up, or an order for the Agent’s winding up is made on the
petition of any of its creditors; or
any steps are taken with a view to the
dissolution of the Agent (other than for the purpose of any
reconstruction or amalgamation which, in the case of the Bank Agent
only, has been previously sanctioned in writing by the Bank of
Scotland); or
anything analogous to or having a substantially
similar effect to any of the events specified in this definition
shall occur under the laws of any applicable jurisdiction;
or
the Agent ceases, or threatens to cease, to
carry on all or a substantial part of its business.
the
" Kilowatt Hour
Rate
"
5.3 pence;
“NFFO Power
Purchase
means contracts with The Non Fossil
Purchasing
Agreements”
Agency Limited and those in
connection with Scottish renewable orders including any replacement
contract with The Non Fossil Purchasing Agency Limited concluded in
connection with the implementation of the new British Electricity
Trading and Transmission Arrangements in Scotland presently
targeted for on or around April 2005;
“Non Bank
Company”
means those Project Companies (as at
the date of this Agreement listed in Part 2 of Schedule
1 ) which are a party or become a party to this Agreement
in accordance with Section 12 and which are not
Bank Companies ;
"Relevant
Project
for each Project Company the later
of (i) the date
Company Long Stop
Date"
(if any) shown in Schedule
1 , (ii) the date twelve months after the first payment
under the Development Services Agreement and (iii) the date when
the Developer (or its subcontractors) acknowledge that
Commissioning will not take place for a particular site/or removes
the Equipment being itself no later than eighteen months after the
first payment under the Development Services Agreement;
“Site”
means in relation to any New Project
the landfill site on which the new or additional (as the case may
be) electricity generating equipment is to be constructed and/or
installed pursuant to this Agreement;
" Term
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means in respect of a New Project the period of time commencing on
Commissioning and ending on the later of (i) the tenth anniversary
of Commissioning and (ii) the date when the Developer exercises its
right to take away any New Project Equipment from the Site in
accordance with its rights under Section 4
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“Third Amendment
and
means the third amendment and
restatement
Restatement
Agreement”
agreement made between inter alios,
(1) Projects 2, (2) CLPE 1999 Limited, (3) CLPE Projects 1 Limited,
(4) CLPE ROC 1 Limited (4) the Bank Agent, (5) certain Project
Companies and (6) the Bank of Scotland on or around the date of
this Agreement;
and each of the following shall have the meaning
set forth in the recitals to this Agreement:
“a Subsequent Electricity Sales
Contract”
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Words and
expressions defined in the Companies Act 1985 (as amended) (the "
Companies Act ") shall (unless the context clearly
does not so permit) bear the same meanings where used in this
Agreement.
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The ejusdem
generis rule of construction shall not apply to this Agreement and
accordingly general words shall not be given a restrictive meaning
by reason of their being preceded or followed by words indicating a
particular class or examples of acts matters or things.
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Words importing
the singular shall include the plural and vice versa and words
importing any gender shall include all other genders and references
to persons shall include corporations and unincorporated
associations.
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References in
this Agreement to statutory provisions shall be construed as
references to those provisions as respectively amended consolidated
extended or re-enacted from time to time and shall include the
corresponding provisions of any earlier legislation (whether
repealed or not) and any orders regulations instruments or other
subordinate legislation made from time to time under the statute
concerned.
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References to
this Agreement shall include the Schedules hereto which shall form
part hereof and shall have the same force and effect as if
expressly set out in the body of this Agreement.
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The Clause
headings in this Agreement are for convenience only and shall not
affect the interpretation hereof.
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References to a
document being in the agreed terms shall be reference to a document
the form of which has been agreed and initialled by or on behalf of
all the parties hereto.
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Section 2.
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Appointment
of Agent . Each of the
Bank Companies hereby appoints the Bank Agent as its agent and each
of the Non Bank Companies hereby appoints the Non Bank Agent as its
agent, for all purposes in connection with the activities and
transaction contemplated by this Agreement. Each Agent hereby
accepts such appointment, and agrees to use commercially reasonable
efforts to perform the Agent Services for and on behalf of each
relevant Project Company in respect of its New Project as set out
in this Agreement or as otherwise may be agreed in writing between
such Project Company and such Agent, with the approval of the
Developer provided that each Agent shall be entitled to recover
from the relevant Project Companies all costs incurred by it in
delivering the Agent Services. Each Agent shall be the sole
authorized representative of each of the relevant Project Companies
in connection with the development of the New Projects and the
execution of any Subsequent Electricity Sales Agreements, and shall
have the authority to enter into binding legal obligations on
behalf of each of the relevant Project Companies in connection
therewith. The Developer and other third parties may rely on such
authority of the Agent without further inquiry. Each of the Project
Companies will execute on the date hereof a power of attorney in
the agreed terms which shall appoint the relevant Agent as its
attorney in accordance with this Section 2 . The
Bank Companies shall jointly and severally indemnify and hold the
Bank Agent harmless and the Non Bank Companies shall jointly and
severally indemnify and hold the Non Bank Agent harmless, from all
loss, cost or expense arising out of the operation of the Agent
Services and each Agent shall be entitled to reimbursement from the
relevant Project Companies in respect of any expenses incurred in
the operation of the Agent Services. Each Agent will use
commercially reasonable endeavours to perform the Agent Services
within the time agreed and to the standard agreed and, if no time
or standard is agreed, then within a reasonable time and to a
reasonable standard. If despite those endeavours an Agent is unable
for any reason other than that Agent’s negligence or wilful
default, to perform such services and activities such Agent will be
deemed not to have breached this Agreement.
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It is agreed
that neither Agent will have any liability to the Developer or the
Project Companies for indirect or consequential loss (which terms
include, without limitation, pure economic loss, loss of profits,
loss of business, depletion of goodwill and like loss) howsoever
caused save that neither Agent excludes its liability (if any) to
the Developer or the Project Companies for loss arising from the
Agent’s wilful default or for personal injury or death
resulting from that Agent’s negligence, fraud or for any
matter which it would be illegal for such Agent to exclude or to
attempt to exclude its liability.
The Developer
agrees that it shall not enforce or seek to enforce any of its
rights against the Project Companies and shall have recourse only
to the relevant Agents, save in relation to the Developer’s
right of indemnity pursuant to Section 4
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If an
Insolvency Event occurs in respect of an Agent the appointment of
that Agent under this Section shall immediately terminate and all
obligations, rights and remedies shall be direct between the
relevant Project Companies and the Developer pending the
appointment (if any) of a replacement to that Agent as specified
below. Any monies held by such Agent on behalf of the Project
Companies shall be paid by the Agent to the relevant Project
Company to enable it to fulfil its obligations under this
Agreement.
In the event
that an Insolvency Event occurs in relation to an Agent, the
relevant Project Companies shall as soon as reasonably practical
appoint another party to be a Bank or Non Bank Agent as the case
may be pursuant to this Agreement and shall procure that the
replacement Agent enters into all novations, deeds and covenants as
may be necessary to ensure the replacement Agent is bound by the
obligations and terms of this Agreement and all other relevant
arrangements contemplated by this Agreement (subject always to the
terms of:-
(a) a ROC Project DSA Direct Agreement entered into
on the date hereof between the Developer, the Agents, the Project
Companies and the Governor Company of the Bank of Scotland;
and
(b) the Facility Agreement).
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Section 3.
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Development
of New Projects .
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(a)
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The Developer
hereby undertakes to use all reasonable commercial efforts to cause
the construction, installation and Commissioning of a New Project
at each relevant Site for the benefit of each Project Company in
accordance with the terms hereof. The parties contemplate that the
Developer will enter into a development agreement with CLP
Developments Limited a company registered in England and Wales with
number 04502342 (“CLP Developments”) substantially in
the form of the agreement in the agreed terms (the
“Development Services Agreement”) for procurement of
equipment, and the construction, installation and Commissioning of
each New Project on a “turnkey” fixed-price basis of
£850,000 per megawatt of rated export capacity of the
generating equipment installed in each New Project (pro-rated to
the extent that such installed capacity is expressed in other than
whole megawatt amounts). If the Developer wishes to terminate or
amend the Development Services Agreement or waive any of its rights
thereunder or enter into a new development agreement it shall first
obtain the consent of the Agents to such termination, amendment,
waiver or new agreement and such consent of the Agents shall not be
unreasonably withheld or delayed.
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(b)
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Each of the
Project Companies and the Agents agree to accept the performance of
CLP Developments (or any other company within the same group) under
the Development Services Agreement as performance by the Developer
hereunder.
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(c)
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Where the
Developer has not by the Relevant Project Company Long Stop Date
reached Commissioning on a Site the relevant Project Company shall
be entitled to adopt any other methods to develop the Site which it
believes are reasonable or which it considers necessary to comply
with its obligations to the owner or operator of the Site, and the
relevant Agent may require that any Equipment is removed from the
Site by the Developer.
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(d)
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The Developer
agrees that it shall provide or procure the provision of separate
metering and separate electricity network connection for the New
Project to, inter alia, enable separate monitoring of electrical
output for the New Project and (where relevant) the Existing
Project at each Site.
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Section 4.
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Ownership
and Operation of New Projects . Notwithstanding the Commissioning of any New
Project, the Developer will retain title to and ownership of all
Equipment, and the Project Company shall have the right to use such
Equipment for the Term to generate electricity (and related
environmental attributes) for sale under Subsequent Electricity
Sales Agreements for so long as such Project Company remains in
compliance in all material respects with the material terms of this
Agreement applicable to it. In the event that the relevant Project
Company (or its Agent) shall materially default on any of their
respective obligations hereunder, and such default continues
uncured for a period of thirty days after written notice from the
Developer, then the Developer may take possession of the Equipment
and remove it from the Site or otherwise exercise any and all other
remedies available under this Agreement or otherwise at law. The
Project Company will indemnify and hold the Developer harmless from
all loss, cost or expense arising from the assertion by any party
of any lien, encumbrance or claim of title or ownership interest
with respect to the any of the Equipment which arise as a result of
any act or omission of the Project Company or its Agent.
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The parties
acknowledge that a Site may, following Commissioning, cease to
generate sufficient exporting capacity to make the New Project
economically viable. If the Developer determines in its absolute
discretion and acting reasonably that the New Project has ceased to
be economically viable, it shall notify the relevant Agent and the
relevant Project Company accordingly in writing together with the
reasons for its decision. Upon receipt of the notice by the
relevant Agent, the Developer or its agents shall be authorised to
en
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