Exhibit 10.1
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RESERVATION OF RIGHTS AGREEMENT
This RESERVATION
OF RIGHTS AGREEMENT (this "Agreement") dated as of June
23, 2005 (the "Effective Date") is hereby
entered into between PAMC Management
Corporation, a Colorado corporation
("PAMC") and Zond Pan Aero Windsystem
Partners I, a California limited
("ZWP").
W I T N E S S E T H
A. WHEREAS, PAMC
and Southern California Edison ("SCE") have entered into
that certain Reformed Standard Offer 1
As-Available Capacity and Energy Power
Purchase dated June 23, 2005 (the "Power
Purchase Agreement"), providing for the
sale to SCE of capacity and associated
energy generated by qualifying facilities
at the site described in the Power Purchase
Agreement (the "Operating Site");
and
B. WHEREAS, in
connection with the Power Purchase Agreement, PAMC and SCE
have entered into that certain
Interconnection Facilities Agreement dated June
23, 2005 (the "Interconnection Agreement")
providing for the interconnection of
the generating facilities located at the
Operating Site to the SCE transmission
system at the substation (the "Mesa
Substation") located at the Operating Site.
C. WHEREAS,
PAMC, in entering into the Power Purchase Agreement and the
Interconnection Agreement, acted on its own
behalf and, as project manager, on
behalf of unidentified other owners who,
along with PAMC, are collectively
referred to as the seller in Power Purchase
Agreement and the Interconnection
Agreement; and
D. WHEREAS,
pursuant to that certain Wind Park Easement Agreement dated as
of September 7, 1984 (as amended, the "Wind
Park Easement") by and between Mesa
Wind Developers, a California joint venture
("MWD") and ZWP, ZWP has installed
and operates wind turbine generators with a
total nameplate rating of 19.5
megawatts ("MW") (the "Turbines") on a
portion of the Operating Site and uses
certain collection lines and related
equipment and the Mesa Substation owned by
MWD and located at the Operating Site;
and
E. WHEREAS, PAMC
desires to reserve to ZWP as a seller under the Power
Purchase Agreement and the Interconnection
Agreement, and ZWP as a seller under
the Power Purchase Agreement and the
Interconnection Agreement desires to
reserve from PAMC, a portion of the
entitlement to sell to SCE capacity and
associated energy under the Power Purchase
Agreement, all on the terms and
conditions of this Agreement; and
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NOW, THEREFORE,
in consideration of the foregoing and the mutual agreements
contained herein, and for other good and
valuable consideration, the receipt and
sufficiency of which are hereby
acknowledged, the parties hereto agree as
follows:
Section 1.
Reservation of Rights.
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(a) On and as of
the Effective Date, ZWP shall be an owner and a seller
under the Power Purchase Agreement and the
Interconnection Agreement. On the
terms and conditions set forth herein, as
of the Effective Date, PAMC reserves
to ZWP (i) a portion of the entitlement to
sell capacity and associated energy
under the Power Purchase Agreement
aggregating 19.5 MW and (ii) a portion of the
entitlement to reserve and use the
interconnection facilities (the
"Interconnection Facilities"), as described
in the Interconnection Agreement to
transmit such energy to SCE (collectively,
the "Reserved Interest").
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(b) Each party
agrees that the reservation of the Reserved Interest
hereunder does not constitute an assignment
of any of PAMC's rights, ownership
interest, duties, responsibilities and
obligations under the Power Purchase
Agreement and Interconnection Agreement and
is solely intended to memorialize
the amount of capacity and associated
energy that ZWP can deliver as an owner
and seller under the Power Purchase
Agreement and Interconnection Agreement.
Notwithstanding any other terms or
provisions contained in this Agreement, PAMC
shall at all times remain liable under the
Power Purchase Agreement and
Interconnection Agreement to perform all of
its duties and obligations under the
Power Purchase Agreement and the
Interconnection Agreement to the same extent as
if this Agreement had not been
executed.
(c)
Notwithstanding anything herein to the contrary, ZWP (i) shall
comply
with all terms and conditions of the Power
Purchase Agreement and the
Interconnection Agreement to the extent
applicable to a seller and an owner
thereunder and (ii) shall not take any
action, nor refuse to take any action
required to be taken by it as a seller
under the Power Purchase Agreement or the
Interconnection Agreement to permit
compliance by PAMC as the counterparty to
SCE under the Power Purchase Agreement and
the Interconnection Agreement.
Section 2.
Purchase, Sale and Delivery Obligations
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(a) During the
term of this Agreement, ZWP shall, through PAMC, as Project
Manager (as defined in the Power Purchase
Agreement), deliver to SCE all
capacity and associated energy with respect
to the Reserved Interest.
(b) ZWP shall
deliver the electric power from the Turbines to the Mesa
Substation for delivery to the SCE
transmission system pursuant to the
Interconnection Agreement.
Section 3.
Disposition of Revenues and Expenses.
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(a) All revenues
and other payments received by PAMC from the sale of
capacity and energy to SCE under the Power
Purchase Agreement (collectively, the
"Revenues") shall be held in trust for the
benefit of ZWP and the other sellers
under the Power Purchase Agreement. Each
such seller shall be entitled to the
portion of such Revenues equal to (i) the
Revenues multiplied by (ii) a fraction
(A) the numerator of which shall equal the
aggregate metered production of such
seller's wind turbines during the period
applicable to such Revenues and (B) the
denominator of which shall equal the
aggregate metered production of the wind
turbines of all the sellers that delivered
power to SCE under the Power
Agreement during the period applicable to
such Revenues. PAMC shall pay to ZWP
the portion of the Revenues received with
respect to any calendar month within
thirty (30) days of the receipt of such
Revenues from SCE.
(b) All fees,
expenses and costs incurred by PAMC under the Power Purchase
Agreement and the Interconnection
Agreement, including interconnection and
maintenance costs any other costs incurred
by PAMC under the Power Purchase
Agreement and the Interconnection
Agreement, shall be allocated among ZWP and
the other sellers
