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HomeMy WebLinkAbout1986-05-12 86-204 ORDERIntroduced by Councilor yilley CITY OF BANGOR (TITLE.) @raert ............. Authorizing Execution of Consent and Agreement — Solid Waste Disposal facility BMt City Carona[ of W My ofBargo.: ORDERED. TEAT WHEREAS, the City of Bangor and Panonsoot Energy Recovery Cnmpeny have entered into an Agreement for the future disposal of solid waste at a plant to be constructed in orri,gton; arc] WHEREAS, as a candition of the financing of said facility it is necessary for the Campany to assign its rights under said Agreement to financing institutions; ami WHEREAS, under Article XVIII, Paragraph B of a "Waste Disposal Agreement between Penobscot Energy Recovery Caolxny anN the, City of Bangor', dated .July 10. 1985, the City consented to the granting of mortgages. upon said facility - and the assignmmnt of ttm Company's rights to financing institutions; and 4d@%iB45, thefinancing institutions have requested an additional agreement frau the municipality relating to said mortgages arc] assignments, a copy of said agreement being on file in the office of the City Clerk, NOW, THEREPOAE, BY THE CITY CWRCIL OF THE MY OF BANOJR, BE a o RED, TEAT the City Manager is hereby authorized ani directed, on behalf of the City of Bangor, to execute a Consent anJ Agreemni, a rept' of which is file in the office of the City Clerk, between the City of Bangor sod Mellon Bank, N.A., Bankers Trust Company. and Penobscot Energy H ery Company. B 204 In City CouftiINftytd2M* 0 R C E R Passed E., Title, uiey Clei i .. A uiani%ini Lmcxtian nr.amteabt. and and agreement - solid waste disposal ...................................... raeul2y Iptrod%eea and ruga by caane� n 1 86-204 MUNICIPAL OPINION (EXHIBIT Y) CONSENT AND AGREEMENT This CONSENT AND AGREEMENT, dated as of , 1986, (herein, as amended and supplemented from time to time as permit-- ted hereby, called this "Agreement") is executed by a municipal corporation (the "Involved Party"), with its address at and Mellon Bank N.A., as Trustee under the Indenture (as hereinafter defined), Bankers Trust Company, as Agent under the Credit Agreement (as hereinafter defined) and the Penobscot Energy Recovery Company ("the Owner"). The Involved Party has entered into a waste Disposal Agreement dated as of 1' with the Owner (such Agreement ,s the same 'may at any .time, be. amended, modified or supplemented in. accordance with the terms of this Agreement and the Assignment of Contracts and Security Agreement referred to below being hereinafter called the "Assigned Contract'7. The Owner has entered into an Assignment of Contracts and Security Agreement dated as of May 15, 1986 (the "Bond Assignment") in favor of Mellon Bank, N.A., as Trustee (the "Trustee") under the Trust Inden- ture dated as of April 1, 1986, with the Town of Orrington (the "Town") (such ,Indenture as the same may at any time be amended, modified o supplemented and in effect being hereinafter called the "Indenture") Bankers Trust Company, as Agent (the "Agent") for the Banksparty to the Credit Agreement dated as of May 15, 1986 among the Owner, PERC Management Company, Energy National, Inc., such Banks and the Agent (such Agreement as the same may at any time be amended, modified and WA supplemented and in effect the 'loan Agreement") and an Assignment of Contracts and Security Agreement dated as of May 15, 1986 (the "Bank Assignment") in favor of Bankers Trust Company, as Agent (the "Agent") for the Banks party to the Credit Agreement dated as of May 15, 1986 among the Owner, PERC Management Company, Energy National, Inc., such Banks and the Agent (such Agreement as the same may at any time be amended, modified and supplemented and in effect the "Loan Agreement"). The Bond Assignment and the Bank Assignment are herein- after collectively referred to as the Assignments. The Owner, the Agent, certain of the Banks and the Facing Bank named therein have entered into a Letter of Credit and Reimbursement Agreement dated as of May 15, 1986 (such Agreement as the same may be amended, modified and supplemented and in effect the "Facing Agree- ment') pursuant to which the Facing Bank has 'agreed to issue Letters of Credit at the request. of the Owner and the Banks to support the payment of principal and interest on Bonds issued pursuant to the Indenture. The Banks are unwilling to request Letters of Credit to be issued and to make Loans (as defined in the Loan Agreement), and the Facing Bank is unwillingto issue Letters of Credit, unless the Involved Party enters into this Agreement. AGREEMENT NOW, THEREFORE, in consideration of the premises, and in order to induce the Banks to request Letters of Credit to be issued and make Loans (as defined in the Loan Agreement) pursuant to and in accordance with the Loan Agreement, and the Facing Bank to issue Letter, of Credit pursuant to and in accordance with the Facing Agreement, the Involved Party warrants, represents and agrees as follows: 1. Involved Party's Warranties and Representations. 86-204 -3- The Involved Party warrants and represents as follows: (a) The Involved Party is a municipal corporation duly or- ganized and validly existing and in good standing under the laws of the State of Maine and has all requisite power and authority to engage in the transactions contemplated by the Assigned Contract and this Agreement and has full power, authority and legal right to execute and deliver, and to perform and observe the provisions of, the Assigned Contract and this Agreement. (b) The Assigned Contract has been duly authorized, executed and delivered by the Involved Party and constitutes the valid, legal and binding obligation of the Involved Party, enforceable in accordance with its terms, except as enforcement may be limited by bankruptcy, insolven- cy, reorganization, moratorium or other similar laws of general application affecting the rights of creditors. (c) The Assigned Contract is in full force and effect in accor- dance with its terms, the Assigned Contract has not been amended, modified or supplemented nor has any provision thereof been waived, and no default under the Assigned Contract has occurred and is continuing. The Involved Party has not heretofore received notice of any transfer or assignment of the Assigned Contract. To the knowledge of the Involved Party, the Involved Party has no outstanding, pending or threatened counterclaims, offsets or defenses against its obligations to perform the Assigned Contract in accordance with its terms. (d) There is no action, suit or proceeding to which the In- volved Party is a party pending, or to the best knowledge of the In- volved Party, threatened, in which the validity of the Assigned Contract or this Agreement or any action taken or to be taken pursuant thereto or hereto is questioned or which in any way materially impairs the Involved -y - Party's ability to meet its current and anticipated obligations under the Assigned Contract and this Agreement on a timely basis. (e) The execution, delivery and Performance of the Assigned Contract and this Agreement and the transactions contemplated thereby and hereby will not result in any violation of any term of the Involved Party's constituent documents or enabling legislation (charter or bylaws) or any mortgage, indenture, indebtedness, agreement, instrument, li- cense, permit, judgment, decree, order, constitutional provision, law, statute, ordinance, rule or regulation applicable to it and will not conflict with, or cause a breach or default under any such term or result in the creation of any mortgage, lien, charge or encumbrance upon any of its properties or assets pursuant to such term. (f) No consent, approval, order or authorization of, or regis- tration, declaration or filing with, any governmental or public body or authority is required to be obtained or made by the Involved Party for the valid authorization, execution, delivery, observance and performance by the Involved Party of the Assigned Contract and this Agreement, except that enactment of a waste stream control ordinance may be required for performance of the Assigned contract. (g) The Involved Party will duly and Punctually comply with the Assigned Contract and this Agreement. 2. Involved Partys Consent and Agreement. The Involved Party hereby acknowledges notice of, and consents to the terms and provisions of the Assignment insofar as the same relate to the Assigned Contract and to the assignment of the Owner's rights under the Assigned Contract pursuant to the Assignments, and agrees that as long as required by the terms of the Assignments (A) it will deliver or remit directly to Bankers Trust Company, as Agent, at 280 Park Avenue, New York, New York 86-209 5- 1001], Attention: Donald R. Carse, Jr., Vice President and Mellon Bank, N.A. as Trustee at One Mellon- Bank Center, Pittsburgh, Pennsylvania 15258, Attention: William McNamee, copies of all notices and other instru- ments, reports, financial statements and communications required or permitted to be given or made by the Involved Party pursuant to the Assigned Contract or this Agreement and (B) except to the extent no- tified otherwise in writing by the Agent, it will deliver or remit directly to Mellon Bank, N.A. as Trustee at One Mellon Bank Center, Pittsburgh, Pennsylvania 15258, Attention: William McNamee to the extent required by and in accordance with the terms of the Assigned Contract, all payments„ tenders and security now or hereafter payable to or receivable by the Owner under Assigned Contract. 3. Amendment or Termination of the Assigned Contract The Involved party acknowledges that the Owner cannot, without the express prior written consent of the Required Banks (as defined in the Loan Agreement), agree to any amendment to or supplement of any provision of the Assigned Contract. The Involved Party acknowledges that the Owner cannot, without the express prior written -consent of such Required Banks, agree to the Involved Party's transfer or assignment of any of its rights or duties under the Assigned Contract if such transfer or assign- mentwould in any way release the Involved Party from, or diminish any of the obligations of. the Involved Party under, the Assigned Contract' The preceding sentences shall not be deemed to be a waiver by the Involved Party of any of its rights under the Assigned Contract. 4. No Default or Termination of Assigned Contract. The Involved Party agrees that notwithstanding anything to the contrary contained in the Assigned Contract, none of the following shall constitute, as between the Involved Party, the Agent, the Facing Bank, the Banks, the Town, 86-209 -6- and the Trustee for the benefit of the Bondholders, a default by the Owner thereunder or shall result in a termination thereof and the In- volved Party consents to each of the following: (i) the assignment by the Owner of the Assigned Contract pursuant to the Assignment's; (ii) the operation of the Project by or for the account of the Trustee or the Agent following default in payment of the Bonds or any other Event of Default under the Indenture or the Loan Agreement (and prior to final acquisition of the rights of the Owner under subparagraph (iv) or (v)); (iii) foreclosure or other enforcement of the Assignments by the Trustee, the Agent, the Facing Bank or any Bank; (iv) acquisition of the rights of the Owner under the Assigned Contract in foreclosure or upon other enforcement of the Assignments by the Trustee, the Agent, the Facing Bank, any Bank or any third party (or acceptance of an absolute assign- ment of the Assigned Contract in lieu of foreclosure or other enforcement of the Assignments), provided that the Trustee, the Agent, the Facing Bank, the Bank or such third party, as the case may be shall have affirmatively assumed in writing all obligations of the Owner under the Assigned Contract; or (v) assignment of the Assigned Contract by the Trustee, the Agent, the Facing Bank, or any Bank following a purchase in foreclosure or other enforcement of the Assignments or following an absolute assignment thereof in lieu of foreclosure or other enforcement of the Assignments, provided that the assignee shall have affirmatively assumed all obligations of the Owner under the Assigned Contract Upon any assumption described in subparagraph (iv) or (v) all references in the assigned contract to owner shall be deemed to refer instead to the person assuming all obligations of the Owner pursuant to such subpara- graph. 86-204 %M 5. Certain Rights.. The Involved Party agrees that the Trustee, the Agent, the Facing Bank, each Bank, any purchaser in foreclosure or upon other enforcement of the Assignments, or their successors and assigns (hereinafter collectively called the "Secured Parties'), shall have the following rights with respect to the Assigned Contract: (a) Notwithstanding anything to the contrary contained in the Assigned Contract, without prior notice in writing to the Trustee, the Agent, and any such purchaser of which the Involved Party has knowl- edge, the Assigned Contract (i) shall not be terminated, (ii) shall not be cancelled by action of the Involved Party and (iii) shall not be deemed abandoned or surrendered (in the absence of breach legally justifying termination by the Involved Party), and no amendment of the Assigned Contract or voluntary termination by the Owner shall be valid without the prior written consent of the Trustee, the Agent, and any such purchaser of which it has knowledge. (b) Upon the occurrence of an Event of Default under the Indenture or the Loan Agreement, the Involved Party shall, at the writ- ten request of Secured Parties, or any of them, continue performance for the benefit of Secured Parties under the Assigned Contract, but only in accordance with and as provided by the terms thereof and subject to the terms of this Agreement. (c) The Secured Parties may enforce the Assigned Contract with the same force and effect as if enforced by the Owner subject to any defenses available to the Involved Party against the Owner, but shall, except as provided in this Agreement, have no obligation to perform the obligations of the Owner thereµnder, unless such obligations have been expressly assumed pursuant to subparagraph (iv) or (v) of Section 4 hereof. The Involved Party will accept such performance in lieu of 36-204 g - Performance by the Owner in satisfaction of the obligations of the Owner under the Assigned Contract. (d) The Involved Party shall send the Trustee, the Agent and each such purchaser of which it has knowledge, copies of any notice of default given by the Involved Party to the Owner under the Assigned Contract (hereinafter called a "Notice"), and no such Notice shall be deemed legally effective until given to each of the Secured Parties. The Secured Parties, and each of them, shall have the right, within 45 days of the receipt of a Notice, to cure the defaults listed in such Notice. 6. Assignment as Collateral Security; Effect of this Agreement. The Involved Party acknowledges that the assignment and pledge of the Assigned Contract made by the Assignments is made as collateral securi- ty, and that the execution and delivery thereof shall not in any way impair or diminish any obligation of the Owner or the Involved Party under the Assigned . Contract, nor shall any obligation or any liability under the Assigned Contract be imposed upon the Trustee, any Bank, the Facing Bank, the Agent or any holder of any of the Notes issued by the Owner pursuant to the Loan Agreement or any holder of any of the Bonds issued by the Town pursuant to the Indenture by reason of or arising out of the Assignments or this Agreement. ]. Notices. All notices, demands, requests, consents, approvals and other instruments or communications required or permitted to be given hereunder shall be in writing and shall be delivered or mailed by first-class registered or certified mail, postage prepaid, addressed (A) if to the Involved Party, to I at its address set forth above, or at such other address as the Involved Party shall have furnished to the Agent; (B) if to the Agent, at its address provided for in Section 2 of this Agreement or at such other address as the Agent shall have furnished to the Involved Party in writing; and (C) if to the Trustee, at its address provided for in Section 2 of this Agreement, or at such other address as the Trustee shall have furnished to the Involved Party in writing. Any notice, direction, de- mand, request, consent, approval, statement or other instrument of communication so addressed and mailed by registered or certified mail shall be deemed to have been given when so mailed. 8. Miscellaneous. (a) This Agreement shall be binding upon the Involved Party and its respective successors and assigns and inure to the benefit of and be enforceable by the Owner, the Facing Bank, each of the Banks and the Agent and the holders from time to time of the Nates (as defined in the Loan Agreement). Each and every remedy of Facing Bank, the Banks, the Agent and any such holder shall be. .cumulative and shall be to addition to any other remedy given hereunder o or hereafter exist- ing at law, in equity or by statute. The headings to the various sections of the Agreement have been inserted for convenience of reference only and shall not modify, define, limit or expand the express provisions of this Agreement Neither this Agreement nor any Provision hereof may be amended, modified, waived, discharged or (except as specifically provided herein) terminated except by any instrument signed by the Trustee and the Agent. If any provision of this Agreement or any application thereof shall be invalid or unenforceable, the remainder of this Agreement and any other application of such provision shall not be affected thereby. (b) This Agreement shall remain in full force and effect as to the Involved Party as long as the Involved Party shall have any obligation under the Assigned Contract and upon the ending of such 86-204 ens obligation, this Agreement shall automatically terminate and be of no further force or effect. (c) This Agreement may be executed in two or more counter- parts, each of which shall be deemed an original and such counterparts shall together constitute but one and the same Agreement. It shall not be necessary in making proof of this Agreement to produce or account for more than one such counterpart. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Maine. 9. Completion of Financing. The Involved Party acknowledges and agrees that (i) the Owner has achieved Completion of Financing (as defined in the Assigned Contract) on or prior to the date of this Agree- ment and the Involved Party waives any rights or remedies it may have by reason of any failure of the Owner to satisfy any condition set forth in Article III.0 of the Assigned Contract; and (ii) the conditions set forth in Article II.A.6 and Article III.A of the Assigned Contract have been met. 86-204 hie IN WITNESS WHEREOF, the Involved Party has caused this Agree- ment to be signed in its corporate name by its duly authorized officer, as of the day and year first above written. TOWN OF Title: Accepted and Agreed to as of the date first above written. MELLON BANK, N.A., as Trustee under the Indenture By: Name: Title: BANKERS TRUST COMPANY, as Agent under the Credit Agreement and the Facing Agreement By Name: Title: PENOBSCOT ENERGY RECOVERY COMPANY By: PERC Management Company, one of its general partners By: PERC, Inc., its general partner By: Name: Title: 4053.034