Professional Documents
Culture Documents
WITNESSETH:
THAT WHEREAS, pursuant to that certain Order of the Public Service Commission of
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West Virginia (the “PSC”) issued on January 11, 2010, in Case No. 09-0360-E-CS (the “PSC
Order”), Pinnacle is committed to establish and fund a decommissioning fund (“Fund”) to ensure
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that money will be available to the Commission for the “Decommissioning” (hereinafter defined)
of the wind turbines, including all towers, blades, nacelles and transformers, and related wind
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power facilities, then dedicated for the sole use of Pinnacle and not others (collectively the
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“Wind Power Facilities”), to be constructed by Pinnacle at Pinnacle’s wind farm development
near the Town of Keyser in Mineral County, West Virginia (the “Pinnacle Wind Farm at
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NewPage”) in the unlikely event of the occurrence of a Decommissioning Fund Event; and
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in the amount of the Net Decommissioning Costs established by the Consultant made payable to
the Fund, and
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WHEREAS, the Parties desire to enter into this Agreement to set forth their respective
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rights and responsibilities with regard to the Decommissioning of the Wind Power Facilities and
the establishment of the Fund, including the periodic review and adjustment, if necessary, of the
aggregate amount of the Security for the benefit of the Fund, and the procedures to be followed
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by the Commission in making claims against the Fund for Decommissioning costs and expenses;
1. Term. This Agreement shall commence as of the date first written above and shall
continue until terminated as hereinafter provided, but in no event shall exceed the maximum
term permitted by law.
For purposes of this Agreement, “Decommissioning” the Wind Power Facilities shall
mean the dismantling and removal (for offsite reuse, recycling or disposal) of all Wind Power
3. Decommissioning Fund.
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select an escrow agent from among those listed on Schedule A hereto or another escrow agent
with a favorable reputation in the business industry in West Virginia to whom the Commission
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does not reasonably object within thirty (30) days after receiving notice of the appointment (the
“Agent”) to administer such Fund.
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(a) Initial Balance. Prior to commencing construction of the Wind Power Facilities,
GL Garrad Hassan (“Initial Consultant”) shall analyze and prepare a report setting forth an
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amount deemed sufficient to cover the estimated current net costs of Decommissioning the Wind
Power Facilities, which shall be calculated as one hundred and five percent (105%) of the
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estimated cost of Decommissioning the Wind Power Facilities minus the estimated market or
salvage value of the Wind Power Facilities (“Net Decommissioning Cost”). Within thirty (30)
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days of receiving the Initial Consultant’s written report on the then current Net
Decommissioning Cost, Pinnacle shall provide a copy of the Initial Consultant’s report to the
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Commission. Pinnacle will within sixty (60) days of providing the Initial Consultant’s report to
the Commission, furnish to the Agent to be held for the benefit of the Fund (i) an irrevocable
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letter of credit issued by a U.S. commercial bank (or a foreign bank with a U.S. branch) having
total assets of at least $10 billion and a credit rating equal to or better than “A-” by S&P and an
equivalent credit rating by Moody's or Fitch, (ii) a performance bond underwritten by a surety
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licensed and authorized to do business in the State of West Virginia (to which additional parties
may be listed as dual beneficiaries), (iii) a guaranty issued by either Edison Mission Energy or an
affiliate of Pinnacle, incorporated or organized in a jurisdiction of the United States and in good
standing in such jurisdiction, with a credit rating from at least “BBB-” by S&P and “ Baa3” by
Moody's, in each case materially similar to the form of such instrument attached hereto as
Exhibit A, or (iv) another security instrument reasonably satisfactory to the Commission (the
“Security”), in an amount not less than the Net Decommissioning Cost established by the Initial
Consultant; provided, however, that if the Net Decommissioning Cost is zero or less than zero
(market or salvage value exceeds current Decommissioning costs), Pinnacle shall not be required
to post Security.
(b) Periodic Review and Adjustment. On or before the end of the first five (5)
years of the term of this Agreement, and at least once during every subsequent five (5) year
period during the term of this Agreement, Pinnacle shall retain the Initial Consultant or another
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(c) Duty to Maintain Fund. Pinnacle agrees to maintain Security, payable to the Fund,
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in an amount at least equal to the Net Decommissioning Cost as the same may be adjusted from
time to time as herein provided. Pinnacle may from time to time change the form of Security by
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delivering substitute Security to the Agent. If the provider of the Security shall at any time issue
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a notice of cancellation or non-renewal of the Security, Pinnacle shall promptly obtain and
maintain another substitute Security in an amount not less than the most recently determined Net
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Decommissioning Cost, which Security shall be subject to and governed by the terms of this
Agreement in the same manner and to the same extent as the previously provided Security. If at
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any time the Fund is entitled to draw upon or receive payment pursuant to the Security pursuant
to the terms thereof for any reason other than the occurrence of a Decommissioning Fund Event,
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the proceeds of such draw or other payment shall be deposited in the Fund and disbursed to the
Commission or to Pinnacle only pursuant to the terms of this Agreement.
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(a) Leased Properties. Pinnacle is obligated under existing lease agreements with
owners of property on which some of the Wind Power Facilities will be located to decommission
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the turbines located on such properties within a stated period or periods following the expiration,
surrender or termination of the respective leases or upon the occurrence of certain other specified
events (each a “Lease Decommissioning Event”). The lessors under one or more of such leases
have reserved the right to decommission the portion of the Wind Power Facilities located on
their respective properties if Pinnacle fails to do so within the allotted time following a Lease
Decommissioning Event. In addition, one or more current or future lenders to Pinnacle may
reserve the right under certain circumstances to perform Pinnacle’s obligations under one or
more of such leases, including the obligation to decommission the Wind Power Facilities. The
Parties hereto acknowledge and expressly agree that the decommissioning of any Leased
Facilities pursuant to and consistent with the requirements of such lease shall meet the
requirements of Decommissioning hereunder and that the Commission shall be entitled to draw
upon the Fund to pay for the Decommissioning of any of the Wind Power Facilities that are
situated on property leased by Pinnacle only if Pinnacle and all other persons or entities then
possessing a right or obligation to decommission such facilities shall fail or refuse to exercise
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thirty (30) day period, but is diligently pursuing all repair and maintenance activities necessary to
resume generation of electric power as soon as reasonably practicable; or (iii) such interruption is
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the result of compliance with a governmental or utility order. If Pinnacle provides the
Commission with a Lease Facilities Compliance Notice pursuant to clauses (ii) or (iii) of the
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preceding sentence, the Lease Facilities Compliance Notice shall set forth an estimated date for
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resumption of service and supporting documentation regarding the cause of the generation
interruption; provided that Pinnacle may extend the estimated date of resumption of generation
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by providing subsequent supporting documentation of the continuing impediment to generation
and Pinnacle’s efforts to overcome such impediment. If Pinnacle provides a Lease Facilities
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Compliance Notice and resumes generating electric power during the period set forth in the
Lease Facilities Compliance Notice, including any permitted extensions, then Pinnacle shall have
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to timely issue a Lease Facilities Compliance Notice and fails to Decommission the Lease
Facilities within one (1) year of the receipt of a Lease Facilities Abandonment Notice, (y)
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Pinnacle timely provides a Lease Facilities Compliance Notice pursuant to clause (i) of this
Section 4(a), but does not resume electric generation within thirty (30) days of receipt of a Lease
Facilities Abandonment Notice and does not Decommission the Lease Facilities within one (1)
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year of receipt of a Lease Facilities Abandonment Notice, or (z) Pinnacle timely provides a
Lease Facilities Compliance Notice pursuant to clauses (ii) or (iii) of this Section 4(a), but does
not either resume electric generation or Decommission the Lease Facilities within one (1) year of
receipt of a Lease Facilities Abandonment Notice. Not less than thirty (30) days after delivery
by the Commission to Pinnacle of a second written notice notifying Pinnacle of the occurrence of
the Decommissioning Fund Event (“Notice of Claim”), the Commission may seek to
Decommission the Lease Facilities and may submit a claim or claims to the Agent for the
payment or reimbursement from the Fund of the cost of Decommissioning the Lease Facilities.
(b) Owned Property. Pinnacle currently has an option from Allegany Holding
Company to purchase a tract of land on which eleven (11) of the proposed turbines will be
located (the “Allegany Tract”). If the Allegany Tract is acquired by Pinnacle, Pinnacle agrees
that, unless caused by Force Majeure (hereinafter defined) or except as otherwise provided
herein, if all of the Wind Power Facilities that are located on the Allegany Tract (the “Pinnacle
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service and supporting documentation regarding the cause of the generation interruption;
provided that Pinnacle may extend the estimated date of resumption of generation by providing
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subsequent supporting documentation of the continuing impediment to generation and Pinnacle’s
efforts to overcome such impediment. If Pinnacle provides a Pinnacle Facilities Compliance
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Notice and resumes generating electric power during the period set forth in the Pinnacle
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Facilities Compliance Notice, including any permitted extensions, Pinnacle shall have no
obligation to Decommission the Pinnacle Facilities by reason of the Pinnacle Facilities
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Abandonment Notice. A “Decommissioning Fund Event” shall occur if either (x) Pinnacle fails
to timely issue a Pinnacle Facilities Compliance Notice and fails to Decommission the Pinnacle
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Facilities within one (1) year of the receipt of a Pinnacle Facilities Abandonment Notice, (y)
Pinnacle timely provides a Pinnacle Facilities Compliance Notice pursuant to clause (i) of this
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Section 4(b), but does not resume electric generation within thirty (30) days of receipt of a
Pinnacle Facilities Abandonment Notice and does not Decommission the Pinnacle Facilities
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within one (1) year of receipt of a Pinnacle Facilities Abandonment Notice, or (z) Pinnacle
timely provides a Pinnacle Facilities Compliance Notice pursuant to clauses (ii) or (iii) of this
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Section 4(b), but does not either resume electric generation or Decommission the Pinnacle
Facilities within one (1) year of receipt of a Pinnacle Facilities Abandonment Notice. Not less
than thirty (30) days after delivery by the Commission to Pinnacle of a Notice of Claim, the
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Commission may seek to Decommission the Pinnacle Facilities and may submit a claim or
claims to the Agent for the payment or reimbursement from the Fund of the cost of
Decommissioning the Pinnacle Facilities.
(c) To the extent that it may lawfully do so and provided that the Commission is not
in breach of this Agreement, Pinnacle hereby authorizes and grants to the Commission, its
employees and agents, permission to enter upon the various respective properties upon which the
Wind Power Facilities are located, as an invitee of Pinnacle and subject to Pinnacle’s rights and
obligations under the affected real property lease, easement or other agreements, for the purpose
of preparing for and carrying out the Decommissioning of such facilities upon the occurrence of
a Decommissioning Fund Event. The Commission acknowledges, however, that Pinnacle may
not possess the authority to grant the Commission access to and over the parcels on which the
Leased Facilities are located. Prior to entering upon any of the parcels on which the Leased
Facilities are located, the Commission shall confer with the owner or owners of such tracts and
(a) On and after the tenth (10th) Business Day (as hereinafter defined) following
service of a Notice of Claim on Pinnacle, subject to Section 5(b) below, the Commission may
submit a claim to the Agent for the payment or reimbursement from the Fund of the
Commission’s actual cost of Decommissioning the Wind Power Facilities (whether Lease
Facilities or Pinnacle Facilities, or both), as reduced by the salvage value of the Wind Power
Facilities to be Decommissioned (the “Commission Claim”). The Commission or the Agent
shall then, on behalf of the Fund, request a draw upon, or other payment under, the Security,
pursuant to the claim requirements thereof (including, without limitation, certification that a
Decommissioning Fund Event has occurred, that all required notices hereunder have been
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properly issued and timely served on Pinnacle and that ten days have lapsed from the Notice of
Claim). The Agent shall have no obligation to disburse any amount from the Fund unless, until,
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and to the extent funds are available in the Fund. As used in this Agreement, “Business Day”
shall mean any day other than a Saturday, Sunday or any other day on which U.S. banks are
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authorized or required by law or executive order to remain closed.
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During the ten (10) Business Day Notice of Claim period, Pinnacle may provide
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written notice to the Commission and the Agent of its intent to oppose the Commission Claim
(the “Pinnacle Opposition Notice”). The Commission shall not submit the Commission Claim to
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the Agent if the Commission has received the Pinnacle Opposition Notice within such ten (10)
Business Day period. If any dispute regarding the Commission’s right to submit a Commission
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Claim to the Agent, the amount of such claim, and/or the Commission’s right to receive a
disbursement of funds from the Fund results in litigation before a court or tribunal of competent
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jurisdiction, the prevailing party (as between Pinnacle and the Commission) in any such
litigation arising from such dispute will be entitled to payment of all of its costs and expenses in
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connection with such dispute (including reasonable attorney fees) by the losing party.
(c) All funds obtained by the Commission under this Agreement shall be used by the
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Commission solely for the Decommissioning of the Wind Power Facilities and for no other
purposes, including decommissioning activities not required for Decommissioning. Any funds
disbursed to the Commission under this Agreement that remain after the occurrence of a
Termination Event shall be promptly returned to Pinnacle, its successors or assigns, without any
requirement that Pinnacle make a demand for the return of such unused funds and any Security
then remaining for the benefit of the Fund will be cancelled and released or terminated.
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released or terminated. Notwithstanding the foregoing, no new Commission Claims will be
accepted by the Agent after the occurrence of any Termination Event.
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7. Notices. All communications hereunder shall be in writing and shall be deemed to be
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duly given and received:
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upon delivery, if delivered personally, or upon confirmed transmittal, if by
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facsimile;
(b) on the next Business Day if sent by overnight courier; or
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(c) four (4) Business Days after mailing if mailed by prepaid registered mail, return
receipt requested, to the appropriate notice address set forth below or at such other
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address as the Agent or any party hereto may have furnished to the other parties in
writing by registered mail, return receipt requested.
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Fax: 304.257.0777
Tel: 304.257.0777
If to the Agent: To such address for Agent as may be set forth in Schedule A or to
such other address as the Agent may have furnished to the parties
in writing.
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the State of West Virginia. The Parties further hereby waive any right to a trial by jury with
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respect to any lawsuit or judicial proceeding arising or relating to this Agreement. No party to
this Agreement is liable to any other party to the extent that the performance of its obligations
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under the terms of this Agreement is interfered with, delayed, restricted or prevented, in whole or
in part, because of fire, earthquake, flood, tornado or other natural disasters or acts of God, war,
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terrorism, strikes or other labor disputes, electrical outages, equipment or transmission failure,
any law, order, proclamation, regulation, ordinance, action, demand or requirement of any
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government agency or other causes reasonably beyond its control (“Force Majeure”), or because
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of the suspension of operations of all or a portion of the Wind Power Facilities for routine
maintenance, overhaul, upgrade, or reconditioning. This Agreement may be executed in one or
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more counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. All signatures of the parties to this Agreement may be
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transmitted by facsimile, and such facsimile will, for all purposes, be deemed to be the original
signature of such party whose signature it reproduces, and will be binding upon such party. If
any provision of this Agreement is determined to be prohibited or unenforceable by reason of
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any applicable law of a jurisdiction, then such provision shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without invalidating the
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remaining provisions thereof, and any such prohibition or unenforceability in such jurisdiction
shall not invalidate or render unenforceable such provisions in any other jurisdiction.
By: ________________________________
Name: ______________________________
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PINNACLE WIND FORCE, LLC
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By: ________________________________
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Name: ______________________________
Title: _______________________________ D
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[Note: please add any additional attorneys that the Commission would like to have on this list.]
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ADDRESS: ___________________
___________________
___________________
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ADDRESS: ___________________
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___________________
___________________
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WE, __________________, (“LETTER OF CREDIT ISSUER”), ISSUE THIS IRREVOCABLE
STANDBY LETTER OF CREDIT NUMBER L5LS_______________ (“LETTER OF
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CREDIT”) IN FAVOR OF __________________________ (“BENEFICIARY”) FOR THE
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NOTICE OF CLAIM HAS BEEN PROPERLY ISSUED AND TIMELY SERVED AND
SERVED. TEN BUSINESS DAYS HAVE LAPSED FROM THE DATE OF SERVICE
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2. “THIS LETTER OF CREDIT WILL EXPIRE IN LESS THAN THIRTY (30) DAYS,
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APPLICANT IS REQUIRED UNDER THE DECOMMISSIONING FUND AND
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ESCROW AGREEMENT DATED _____ __, 2010 TO MAINTAIN A COMPARABLE
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PAYMENT OF $______________.”
SPECIAL CONDITIONS:
ALL ISSUING BANK CHARGES ARE FOR THE ACCOUNT OF THE APPLICANT.
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DRAWING UNDER THIS LETTER OF CREDIT MAY BE REDUCED
AUTOMATICALLY, WITHOUT AMENDMENT, FROM TIME TO TIME UPON
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OUR RECEIPT OF REDUCTION CERTIFICATE STATING THE AMOUNT OF
REDUCTION AND AVAILABLE AMOUNT AFTER SUCH REDUCTION,
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EXECUTED AND PURPORTEDLY SIGNED BY BOTH APPLICANT AND
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IF A COMPLYING PRESENTATION IS MADE PRIOR TO 12:00 P.M. (P.S.T.) ON A
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________________________
THE LETTER OF CREDIT ISSUER
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AUTHORIZED SIGNATURE
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Bond
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Beneficiary: [____________________]
Address: ______________________________
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______________________________
______________________________
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______________________________
Surety: [____________________] D
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Address: ______________________________
______________________________
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______________________________
______________________________
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Address: ______________________________
______________________________
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______________________________
______________________________
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KNOW ALL MEN BY THESE PRESENTS, that we, Surety named above, are held
and firmly bound unto Obligee and Beneficiary, each named above, in Net Decommissioning
Cost, not to exceed the maximum amount of this bond (this “Bond”) stated above (the
“Maximum Amount”), for the payment of which Net Decommissioning Cost, or performance of
the Decommissioning of the Wind Power Facilities up to such value, we bind ourselves, our
heirs, executors, administrators, personal representatives, successors, and assigns, jointly and
severally, firmly by these presents, subject to the terms and conditions below. Where Surety is
composed of entities acting as co-sureties, we, the co-sureties, bind ourselves, our successors and
assigns, in the amount of such Net Decommissioning Cost, not to exceed the Maximum Amount,
jointly and severally as well as severally only for the purpose of allowing a joint action or actions
against any or all of us, and for all other purposes each co-surety binds itself, jointly and
severally with Beneficiary, for the payment of the Net Decommissioning Cost, not to exceed the
Maximum Amount, or performance of the Decommissioning of the Wind Power Facilities up to
such value.
WHEREAS, this Bond is issued in connection with the Decommissioning Fund and
Escrow Agreement (“Decommissioning Agreement”), dated as of [__________], 2010, by and
between Obligee and the County Commission of Mineral County, West Virginia (“the County”),
in connection with that certain order of the Public Service Commission of West Virginia, issued
on January 11, 2010, in Case No. 09-0360-E-CS (the “PSC Order”), whereby Obligee is
committed to establish and fund a decommissioning fund held by the Beneficiary, as Escrow
Agent, in respect of Obligee’s wind turbines, and associated wind power facilities, to be
constructed at Obligee’s wind farm development project in Mineral County, West Virginia.
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NOW THEREFORE, Beneficiary, Surety and Obligee agree as follows:
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1. If Obligee Decommissions the Wind Power Facilities, then Surety and Obligee shall have
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no obligation under this Bond.
2.
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If no breach or default by County exists under the Decommissioning Agreement, then
Surety’s obligation under this Bond shall arise after:
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2.1 County first provides advance written notice to Obligee, pursuant to the terms of
the Decommissioning Agreement, and advance written notice to Surety that
Beneficiary is considering declaring a Decommissioning Fund Event. Surety
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may, within five (5) business days after receipt of County’s notice, request a
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Beneficiary agrees otherwise, any conference requested under this Section 3.1
shall be held within ten (10) business days of Surety’s receipt of County’s notice.
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2.3 County signs (a) a written release, to be held in escrow by the Agent, pursuant to
which County releases Obligee and Surety for amounts expended by County
necessary to complete Decommissioning of the Wind Power Facilities in excess
of Maximum Amount and (b) a waiver of claims as against Obligee and Surety
relating to Decommissioning of the Wind Power Facilities.
3. When the conditions of Section 2 have been met, Surety shall promptly and at Surety’s
expense take one of the following actions, in its sole discretion, and provide written
notice to Beneficiary of the actions elected:
3.1 Arrange for Obligee, with the consent of Beneficiary, to perform and complete the
Decommissioning of the Wind Power Facilities;
3.2 Undertake to perform and complete the Decommissioning of the Wind Power
Facilities itself, through its agents or independent contractors;
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3.3 After investigation, determine the amount for which it may be liable to
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Beneficiary and, as soon as practicable after the amount is determined, make
payment to Beneficiary by deposit of the actual amount specified under Section
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3.6 into the Fund established pursuant to Section 3(a) of the Decommissioning
Agreement; or
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Deny liability in whole or in part and notify Beneficiary, citing the reasons for
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denial.
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4. If Surety does not proceed as provided in Section 4 with reasonable promptness, Surety
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shall be deemed to be in default on this Bond seven days after receipt of an additional
written notice from Beneficiary to Surety demanding that Surety perform its obligations
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under this Bond, and Beneficiary shall be entitled to enforce any remedy available to
Beneficiary. If Surety proceeds as provided in Sections 3.3 or 3.4, and Beneficiary
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refuses the payment or Surety has denied liability, in whole or in part, without further
notice Beneficiary shall be entitled to enforce any remedy available to Beneficiary.
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5. If Surety elects to act under Section 3.1 or 3.2, then the liability of Surety shall be
discharged by payment, succession of payments, or other expenditure made in
Decommissioning of the Wind Power Facilities hereunder, amounting in the aggregate to
the Net Decommissioning Cost, which in no event shall exceed the Maximum Amount,
even if Decommissioning is incomplete at such time, whereupon County shall be
obligated to complete the Decommissioning of the Wind Power Facilities, without
recourse to Surety or Obligee.
6. Surety’s expenditures under Sections 5 and 3.1 or 3.2 include additional legal, design
professional and delay costs relating to Decommissioning of the Wind Power Facilities.
8. The Surety may cancel the bond by sending notice of cancellation by certified mail to
Beneficiary and Obligee. The Obligee may terminate this Bond by sending written notice
to Beneficiary and to Surety 30 days prior to the proposed date of termination.
9. The Surety shall not be liable to Beneficiary, County or others for obligations of Obligee
that are unrelated to the Decommissioning Agreement. No right of action shall accrue on
this Bond to any person or entity other than Beneficiary or its heirs, executors,
administrators, successors and assigns.
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10. Any proceeding, legal or equitable, under this Bond may be instituted in any court of
competent jurisdiction in the location in which the Decommissioning work or part of
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such work is located and shall be instituted within one year after a declaration of a
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Decommissioning Fund Event of which Beneficiary provides notice to Surety pursuant to
Section 3. If the provisions of this Section are void or prohibited by law, the minimum
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period of limitation available to sureties as a defense in the jurisdiction of the suit shall be
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applicable.
11. All communications hereunder shall be in writing and shall be deemed to be duly given
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and received: (a) upon delivery, if delivered personally, or upon confirmed transmittal, if
by facsimile; (b) on the next Business Day if sent by overnight courier; or (c) four (4)
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Business Days after mailing if mailed by prepaid registered mail, return receipt requested,
to the appropriate notice address set forth below or at such other address as the Agent or
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any party hereto may have furnished to the other parties in writing by registered mail,
return receipt requested.
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If to Surety: [__________]
Attention: [__________]
[__________]
[__________]
Fax: [__________]
Tel: [__________]
If to Obligee: [__________]
Attention: [__________]
[__________]
[__________]
Fax: [__________]
Tel: [__________]
12. This Bond has been furnished to comply with the PSC Order. Any provision in this Bond
conflicting with any legal requirement thereunder shall be deemed deleted herefrom and
provisions conforming to such legal requirement shall be deemed incorporated herein.
When so furnished, the intent is that this Bond shall be construed as a statutory bond and
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not as a common law bond.
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13. This Bond shall be governed by and construed in accordance with the laws of the State of
West Virginia and any reference herein to Beneficiary or Surety in the singular shall
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include all entities in the plural who or which are signatories under the Beneficiary or the
Surety heading below.
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14. Capitalized terms used, but not defined, in this Bond shall have the meanings ascribed in
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Beneficiary
Attest:
By: _______________________________
Name:
Title:
______________________________ as to __________________________________
Secretary [Title]
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Surety
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Attest:
By: _______________________________
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Name:
Title:
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______________________________ as to __________________________________
Secretary [Title]
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CORPORATE
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Approved as to legal form and sufficiency this ____ day of _______________ 20[___].
Form of Guaranty
This GUARANTEE AGREEMENT (the “Guarantee”) is made as of the _____ day of ______,
20__, by )____________, a __________ duly organized and existing under the laws of the State
of __________, (herein called “Guarantor”) for the benefit of ___________, (herein called
“Beneficiary”). Beneficiary and Guarantor are individually referred to herein as a “Party” and
collectively as the “Parties.”
RECITALS:
WHEREAS, Pinnacle Wind Force, LLC, a limited liability company duly organized and
existing under the laws of Delaware (herein called “Subsidiary”), is a subsidiary of Guarantor.
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WHEREAS, the County Commission of Pinnacle County, West Virginia (“County”)
and Subsidiary have entered into that certain Decommissioning Fund and Escrow Agreement,
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dated __________, 2010 (herein the “Contract”) whereby Subsidiary committed to establish and
fund a decommissioning fund, to be held by Beneficiary, to ensure that money will be available
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to the County for decommissioning the wind turbines in the event Subsidiary does not
decommission the wind turbines then dedicated for the use of Subsidiary at Subsidiary’s wind
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farm development near the Town of Keyser in Mineral County, West Virginia (the “Pinnacle
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Beneficiary with security within sixty (60) days of providing a consultant’s report setting forth
an amount deemed sufficient to cover the estimated current net costs of decommissioning the
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WHEREAS, to induce County to enter into the Contract with Subsidiary and to perform
the Contract with Subsidiary, Guarantor has agreed to provide Beneficiary with this Guarantee.
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NOW, THEREFORE, in consideration of the premises and mutual covenants set forth
herein, the Parties hereto agree as follows:
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performance of the Obligations.
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5. Guarantor hereby consents and agrees that, without notice to or subsequent consent by
Guarantor and without affecting or impairing the obligations of Guarantor as herein set
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forth, County may, by action or inaction, compromise, settle, waive, extend, refuse to
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enforce, release (in whole or in part), or otherwise grant indulgences to Subsidiary in
respect to any or all of the Obligations and may amend, modify or extend in any
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manner the Contract or any other documents or agreements relating to the Obligations
other than this Guarantee.
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shall remain in full force and effect until all Obligations have been fully discharged,
without regard to future changes in conditions, including change of law, or any
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invalidity or irregularity with respect to the execution and delivery of any agreement
by County with respect to the Obligations; provided, however, that except in the case
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7. If there is any dispute under the Contract that relates to a sum being claimed under this
Guarantee, which dispute is submitted to a court as established in the Contract, the
obligations under this Guarantee shall be suspended pending the outcome of such
dispute resolution and Guarantor further agrees that any award resulting from such
dispute resolution shall be conclusive and binding on it for purposes of determining its
obligation under this Guarantee.
8. Notwithstanding anything herein to the contrary, Guarantor specifically reserves to
itself all rights, counterclaims and other defenses that the Subsidiary is or may be
entitled to arising from or out of the Contract, except for any defenses arising out of
the bankruptcy, insolvency, dissolution or liquidation of the Subsidiary, the lack of
power or authority of the Subsidiary to enter into the Contract and to perform its
obligations thereunder, or the lack of validity or enforceability of the Subsidiary’s
obligations under the Contract or any transaction thereunder. Nothing contained herein
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successors and assigns of the Parties.
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10. Notwithstanding anything to the contrary contained herein or otherwise, this Guarantee
and the Guarantor’s obligations hereunder shall automatically terminate with no further
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action on the part of Guarantor, Subsidiary or County upon the first to occur of the
following events: (a) the fulfillment of all obligations of Subsidiary under the Contract;
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(b) the termination or expiration of the Contract pursuant to its terms; (c) the payment
by Guarantor of the maximum recoverable amount set forth in Section 1 above. Upon
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termination of this Guarantee in accordance with this Section 10, the Company shall,
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upon Guarantor’s request, execute an acknowledgement that this Guarantee has been
terminated.
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11. Guarantor represents and warrants that it is a corporation duly organized under the
laws of Delaware; that it has full power to enter into this Guarantee; that its execution
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and delivery hereof has been duly authorized; and that this Guarantee constitutes a
legal, valid, and binding obligation of the Guarantor enforceable against Guarantor in
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and received:
a. upon delivery, if delivered personally, or upon confirmed transmittal, if by
facsimile;
b. on the next business day if sent by overnight courier; or
c. four (4) business days after mailing if mailed by prepaid registered mail, return
receipt requested, to the appropriate notice address set forth below or at such other
address as the agent or any Party may have furnished to the other Party in writing
by registered mail, return receipt requested.
If to Guarantor: [insert]
13. This Guarantee shall be governed by and construed in accordance with the laws of the
State of New York, U.S.A., excluding only those provisions regarding conflict of laws.
14. The Parties irrevocably waive any objections, which they may have now or hereafter to
(a) the personal or subject matter jurisdiction of the Courts of the State of New York,
(b) the venue of any proceedings brought in the Courts of the State of New York, or (c)
that such proceedings have been brought in a non-convenient forum. The Parties
irrevocably agree that any final judgment (after appeal or expiration of time for appeal)
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entered by such Court shall be conclusive and binding upon the Parties and may be
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enforced in the courts or any other jurisdiction to the fullest extent permitted by law.
15. This Guarantee may be executed in any number of counterparts, each of which shall be
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deemed an original, but all of which together shall constitute one and the same
instrument.
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[Guarantor]
By: _
Name: _________________________
Title: __________________________
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Acknowledged and Accepted:
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COUNTY COMMISSION OF
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MINERAL COUNTY
By: _ D
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Name: _________________________
Title: __________________________
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