Exhibit 10.9
TAX SHARING
AGREEMENT
This Agreement is made effective
this 9th day of November, 2006 (the “Agreement”)
between MICROGY HOLDINGS, LLC, a Delaware limited liability company
(“Microgy Holdings”), and ENVIRONMENTAL POWER
CORPORATION, a Delaware corporation (“EPC”).
RECITALS
A. Microgy Holdings is primarily
engaged in the business of holding the equity interests in
(i) MST Production Ltd., a Texas limited partnership
(“MST”), (ii) Rio Leche Estates, L.L.C., a Texas
limited liability company (“Rio Leche Estates”),
(iii) Mission Biogas, L.L.C., a Texas limited liability
company (“Mission Biogas”) and (iv) Hereford
Biogas, L.L.C., a Texas limited liability company (“Hereford
Biogas” and, together with MST, Rio Leche Estates and
Mission, the “Subsidiaries”).
B. Microgy Holdings is a wholly
owned subsidiary of EPC.
C. Microgy Holdings, EPC and the
Subsidiaries file consolidated federal income tax returns and would
find it advantageous to file consolidated income tax returns with
state and other taxing authorities.
D. Certain states or other taxing
authorities do not permit Microgy Holdings and EPC to file
consolidated tax returns.
E. Microgy Holdings is engaging in a
financing transaction under (i) that certain Loan Agreement,
dated October 1, 2006, between the Gulf Coast Industrial
Development Authority (the “Issuer”) and Microgy
Holdings (the “Loan Agreement”), (ii) a Trust
Indenture Agreement, dated October 1, 2006, between the Issuer
and Wells Fargo, N.A., as Trustee (the “Indenture”),
which financing transaction will have direct material benefits to
EPC, and one of the conditions of such transaction is that Microgy
Holdings and EPC enter into this Tax Sharing Agreement.
AGREEMENT
1. Definitions . Capitalized
terms not otherwise defined herein shall have the meaning assigned
to such terms in the Loan Agreement.
2. Preparation of Tax Returns
. EPC shall prepare, pursuant to the terms of that certain
Management Services Agreement executed contemporaneously herewith,
or if such agreement has been terminated, pursuant to the terms of
this Section 1, any and all tax returns required to be filed
by Microgy Holdings and/or the Subsidiaries with any taxing
authority (federal, state, local or otherwise) regardless of
whether such tax returns can be prepared on a consolidated basis.
EPC shall undertake such preparation (as well as the preparation
o
