EXHIBIT 4-A-24
_____________________________________________________________________________
_____________________________________________________________________________
LOAN AGREEMENT
between
OHIO WATER DEVELOPMENT AUTHORITY
and
THE CINCINNATI GAS & ELECTRIC COMPANY
_______________________________
$21,400,000
State of Ohio
Collateralized Water Development
Revenue Refunding Bonds, 1994 Series A
(The Cincinnati Gas & Electric Company Project)
_______________________________
Dated
as of
January 1, 1994
_____________________________________________________________________________
_____________________________________________________________________________
INDEX
(This Index is not a part of the Agreement
but rather is for convenience of reference only.)
Page
Preambles. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I
DEFINITIONS
Section 1.1 Use of Defined Terms. . . . . . . . . . . . . . . . . . . . 2
Section 1.2 Definitions . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.3 Interpretation. . . . . . . . . . . . . . . . . . . . . . . 6
Section 1.4 Captions and Headings . . . . . . . . . . . . . . . . . . . 7
ARTICLE II
REPRESENTATIONS
Section 2.1 Representations of the Authority. . . . . . . . . . . . . . 8
Section 2.2 No Warranty by Authority of Condition or
Suitability of the Project. . . . . . . . . . . . . . . . 8
Section 2.3 Representations and Covenants of the Company. . . . . . . . 8
ARTICLE III
COMPLETION OF THE PROJECT;
ISSUANCE OF THE BONDS
Section 3.1 Acquisition, Construction and Installation. . . . . . . . .13
Section 3.2 Project Description . . . . . . . . . . . . . . . . . . . .13
Section 3.3 Issuance of the Bonds; Application of
Proceeds. . . . . . . . . . . . . . . . . . . . . . . . .13
Section 3.4 Investment of Fund Moneys . . . . . . . . . . . . . . . . .14
Section 3.5 Rebate Fund . . . . . . . . . . . . . . . . . . . . . . . .14
ARTICLE IV
LOAN BY AUTHORITY; LOAN PAYMENTS;
ADDITIONAL PAYMENTS; AND FIRST MORTGAGE BONDS
Section 4.1 Loan Repayment; Delivery of First Mortgage
Bonds . . . . . . . . . . . . . . . . . . . . . . . . . .16
Section 4.2 Additional Payments . . . . . . . . . . . . . . . . . . . .16
Section 4.3 Place of Payments . . . . . . . . . . . . . . . . . . . . .17
Section 4.4 Obligations Unconditional . . . . . . . . . . . . . . . . .17
Section 4.5 Assignment of Revenues, Agreement and First
Mortgage Bonds. . . . . . . . . . . . . . . . . . . . . .17
Section 4.6 First Mortgage Bonds. . . . . . . . . . . . . . . . . . . .17
ARTICLE V
ADDITIONAL AGREEMENTS AND COVENANTS
Section 5.1 Right of Access . . . . . . . . . . . . . . . . . . . . . .19
Section 5.2 Maintenance . . . . . . . . . . . . . . . . . . . . . . . .19
Section 5.3 Removal of Portions of the Project Facilities . . . . . . .19
Section 5.4 Operation of Project Facilities . . . . . . . . . . . . . .20
Section 5.5 Insurance . . . . . . . . . . . . . . . . . . . . . . . . .20
Section 5.6 Workers' Compensation Coverage. . . . . . . . . . . . . . .20
Section 5.7 Damage; Destruction and Eminent Domain. . . . . . . . . . .20
Section 5.8 Company to Maintain its Corporate Existence;
Conditions Under Which Exceptions Permitted . . . . . . .21
Section 5.9 Indemnification . . . . . . . . . . . . . . . . . . . . . .21
Section 5.10 Company Not to Adversely Affect Exclusion of
Interest on Bonds From Gross Income For Federal
Income Tax Purposes . . . . . . . . . . . . . . . . . . .22
Section 5.11 Operation and Maintenance . . . . . . . . . . . . . . . . .22
Section 5.12 Use of Project Facilities . . . . . . . . . . . . . . . . .23
Section 5.13 Assignment by Company . . . . . . . . . . . . . . . . . . .23
Section 5.14 Agreements with Bond Insurer. . . . . . . . . . . . . . . .24
ARTICLE VI
REDEMPTION
Section 6.1 Optional Redemption. . . . . . . . . . . . . . . . . . . . .25
Section 6.2 Extraordinary Optional Redemption. . . . . . . . . . . . . .25
Section 6.3 Mandatory Redemption . . . . . . . . . . . . . . . . . . . .27
Section 6.4 Notice of Redemption . . . . . . . . . . . . . . . . . . . .27
Section 6.5 Actions by Authority . . . . . . . . . . . . . . . . . . . .27
Section 6.6 Concurrent Discharging of First Mortgage Bonds . . . . . . .27
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
Section 7.1 Events of Default. . . . . . . . . . . . . . . . . . . . . .28
Section 7.2 Remedies on Default. . . . . . . . . . . . . . . . . . . . .29
Section 7.3 No Remedy Exclusive. . . . . . . . . . . . . . . . . . . . .29
Section 7.4 Agreement to Pay Attorneys' Fees and Expenses. . . . . . . .30
Section 7.5 No Waiver. . . . . . . . . . . . . . . . . . . . . . . . . .30
Section 7.6 Notice of Default. . . . . . . . . . . . . . . . . . . . . .30
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Term of Agreement. . . . . . . . . . . . . . . . . . . . . .31
Section 8.2 Amounts Remaining in Funds . . . . . . . . . . . . . . . . .31
Section 8.3 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . .31
Section 8.4 Extent of Covenants of the Authority; No Personal
Liability . . . . . . . . . . . . . . . . . . . . . . . .31
Section 8.5 Binding Effect . . . . . . . . . . . . . . . . . . . . . . .32
Section 8.6 Amendments and Supplements . . . . . . . . . . . . . . . . .32
Section 8.7 Execution Counterparts . . . . . . . . . . . . . . . . . . .32
Section 8.8 Severability . . . . . . . . . . . . . . . . . . . . . . . .32
Section 8.9 Governing Law. . . . . . . . . . . . . . . . . . . . . . . .32
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
EXHIBIT A - PROJECT FACILITIES COMPRISING KILLEN PROJECT UNIT
EXHIBIT B - PROJECT FACILITIES COMPRISING WALTER C. BECKJORD
PROJECT UNIT
EXHIBIT C - PROJECT FACILITIES COMPRISING MIAMI FORT PROJECT UNIT
LOAN AGREEMENT
THIS LOAN AGREEMENT is made and entered into as of January 1, 1994
between the OHIO WATER DEVELOPMENT AUTHORITY (the "Authority"), a body politic
and corporate organized and existing under the laws of the State of Ohio, and
THE CINCINNATI GAS & ELECTRIC COMPANY (the "Company"), a public utility and
corporation duly organized and validly existing under the laws of the State of
Ohio. Capitalized terms used in the following recitals are used as defined in
Article I of this Agreement.
Pursuant to Section 13 of Article VIII of the Ohio Constitution and the
Act, the Authority has determined to issue, sell and deliver the Bonds and to
lend the proceeds derived from the sale thereof to the Company to assist in the
refunding of the Refunded Bonds as defined below. The Refunded Bonds were
originally issued to provide funds to make loans to the Company to assist in the
financing of its portion of the costs of the Project as defined below.
The Company and the Authority each have full right and lawful authority
to enter into this Agreement and to perform and observe the provisions hereof on
their respective parts to be performed and observed.
NOW THEREFORE, in consideration of the premises and the mutual
representations and agreements hereinafter contained, the Authority and the
Company agree as follows (provided that any obligation of the Authority or the
State created by or arising out of this Agreement shall never constitute a
general debt of the Authority or the State or give rise to any pecuniary
liability of the Authority or the State but shall be payable solely out of
Revenues, including Loan Payments made pursuant to the First Mortgage Bonds):
ARTICLE I
DEFINITIONS
Section 1.1. Use of Defined Terms. In addition to the words and terms
defined elsewhere in this Agreement or by reference to another document, the
words and terms set forth in Section 1.2 hereof shall have the meanings set
forth therein unless the context or use clearly indicates another meaning or
intent. Such definitions shall be equally applicable to both the singular and
plural forms of any of the words and terms defined therein.
Section 1.2. Definitions. As used herein:
"Act" means Chapter 6121 and 6123, Ohio Revised Code, as enacted and
amended from time to time pursuant to Section 13 of Article VIII of the Ohio
Constitution.
"Additional Payments" means the amounts required to be paid by the
Company pursuant to the provisions of Section 4.2 hereof.
"Administration Expenses" means the compensation (which compensation
shall not be greater than that typically charged in similar circumstances) and
reimbursement of reasonable expenses and advances payable to the Trustee, the
Registrar, any Paying Agent and any Authenticating Agent.
"Agreement" means this Loan Agreement, as amended or supplemented from
time to time.
"Authenticating Agent" means the Authenticating Agent as defined in the
Indenture.
"Authority Fee" means an amount not to exceed $63,100.
"Bond Fund" means the Bond Fund created in the Indenture.
"Bond Insurance Policy" means the municipal bond insurance policy issued
by the Bond Insurer that guarantees payment when due of principal and interest
on the Bonds.
"Bond Insurer" means Municipal Bond Investors Assurance Corporation, a
stock insurance company incorporated under the laws of the State of New York, or
its successor.
"Bond Resolution" means the resolution of the Authority providing for
the issuance of the Bonds and approving this Agreement, the Indenture and
related matters, as amended or supplemented from time to time.
"Bond Service Charges" means, for any period or time, the principal of,
premium, if any, and interest due on the Bonds for that period or payable at
that time whether due at maturity or upon acceleration or redemption or
otherwise.
"Bonds" means the $21,400,000 Collateralized Water Development Revenue
Refunding Bonds, 1994 Series A (The Cincinnati Gas & Electric Company Project),
issued by the Authority pursuant to the Bond Resolution and the Indenture.
"Bonds Outstanding" or "Outstanding Bonds" means Outstanding Bonds as
defined in the Indenture.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time. References to the Code and Sections of the Code include relevant
applicable regulations and proposed regulations thereunder and under the
Internal Revenue Code of 1954, as amended, and any successor provisions to those
Sections, regulations or proposed regulations and, in addition, all applicable
official rulings and judicial determinations under the foregoing applicable to
the Bonds.
"Company Mortgage" means the First Mortgage, dated as of August 1, 1936,
between the Company and the Company Mortgage Trustee, as amended, modified or
supplemented from time to time.
"Company Mortgage Trustee" means The Bank of New York (formerly Irving
Trust Company), as trustee under the Company Mortgage, and its successors and
assigns.
"Eligible Investments" means Eligible Investments as defined in the
Indenture.
"Engineer" means an engineer (who may be an employee of the Company) or
engineering firm qualified to practice the profession of engineering under the
laws of the State and who or which is acceptable to the Trustee.
"EPA" means the Environmental Protection Agency of the State and any
successor body, agency, commission or department.
"Event of Default" means any of the events described as an Event of
Default in Section 7.1 hereof.
"First Mortgage Bonds" means the $21,400,000 aggregate principal amount
of First Mortgage Bonds, 5.45% Series A Due 2024, issued under the Company
Mortgage pursuant to the Supplemental Mortgage Indenture.
"Force Majeure" means any of the causes, circumstances or events
described as constituting Force Majeure in Section 7.1 hereof.
"Holder" or "Holder of a Bond" means the Person in whose name a Bond is
registered on the Register.
"Indenture" means the Trust Indenture, dated as of the same date as this
Agreement, between the Authority and the Trustee, as amended or supplemented
from time to time.
"Interest Rate for Advances" means the interest rate per year payable on
the Bonds.
"Kentucky Bonds" means the $48,000,000 Collateralized Pollution Control
Revenue Refunding Bonds, 1994 Series A (the Cincinnati Gas & Electric Company
Project) issued by the County of Boone, Kentucky.
"Loan" means the loan by the Authority to the Company of the proceeds
received from the sale of the Bonds.
"Loan Payment Date" means any date on which any Bond Service Charges are
due and payable.
"Loan Payments" means the amounts required to be paid by the Company on
the First Mortgage Bonds in repayment of the Loan pursuant to Section 4.1
hereof.
"1954 Code" means the Internal Revenue Code of 1954 as amended from time
to time through the date of enactment of the Code. References to the 1954 Code
and Sections of the 1954 Code include relevant applicable regulations (including
temporary regulations) and proposed regulations thereunder and any successor
provisions to those Sections, regulations or proposed regulations.
"1994 Bonds" means collectively, the Bonds, the Ohio Air Bonds and the
Kentucky Bonds.
"Notice Address" means:
(a) As to the Authority: Ohio Water Development Authority
88 East Broad Street
Suite 1300
Columbus, Ohio 43215
Attention: Executive Director
(b) As to the Company: The Cincinnati Gas & Electric Company
P.O. Box 960
Cincinnati, Ohio 45201
Attention: Treasurer
(c) As to the Trustee: The Bank of New York
101 Barclay Street
21st Floor
New York, New York 10286
Attention: Corporate Trust Administration
or such additional or different address, notice of which is given under Section
8.3 hereof.
"Ohio Air Bonds" means the $25,300,000 Collateralized Air Quality
Development Revenue Refunding Bonds, 1994 Series B (The Cincinnati Gas &
Electric Company Project).
"Opinion of Bond Counsel" means a written opinion of nationally
recognized bond counsel selected by the Company and acceptable to the Trustee
who is experienced in matters relating to the exclusion from gross income for
federal income tax purposes of interest on obligations issued by states and
their political subdivisions. Bond Counsel may be counsel to the Trustee or the
Company.
"Original Purchaser" means the Original Purchaser as defined in the
Indenture.
"Paying Agent" means the Paying Agent as defined in the Indenture.
"Person" or words importing persons mean firms, associations,
partnerships (including without limitation, general and limited partnerships),
societies, trusts, corporations, public or governmental bodies, other legal
entities and natural persons.
"Project" or "Project Facilities" means the real, personal or real and
personal property, including undivided or other interests therein, identified in
the Project Description.
"Project Description" means the description of the Project Facilities
identified in and attached hereto as Exhibit A (such portion hereinafter
referred to as "Killen Project Unit"), Exhibit B (such portion hereinafter
referred to as "Walter C. Beckjord Project Unit"), and Exhibit C (such portion
hereinafter referred to as "Miami Fort Project Unit") as each may be amended in
accordance with this Agreement.
"Project Purposes" means the purposes of Waste Water Facilities and/or
Solid Waste Facilities as described in the Act and as particularly described in
Exhibits A, B and C hereto.
"Project Site" means, as to the Killen Project Unit, the Killen Electric
Generating Station in Adams County, Ohio; as to the Miami Fort Project Unit, the
Miami Fort Electric Generating Station in Hamilton County, Ohio; and as to the
Walter C. Beckjord Project Unit, the Walter C. Beckjord Electric Generating
Station in Clermont County, Ohio.
"Project Units" means each of the three project units included in the
Project and described in Exhibits A, B and C hereto.
"Rebate Fund" means the Rebate Fund created in the Indenture.
"Refunded Bonds" means the $21,400,000 in aggregate principal amount of
State of Ohio Collateralized Water Development Revenue Bonds, 1983 Series (The
Cincinnati Gas & Electric Company Project) dated as of May 1, 1983.
"Refunded Bonds Indenture" means the Trust Indenture for the Refunded
Bonds between the Authority and the Refunded Bonds Trustee dated as of May 1,
1983.
"Refunded Bonds Loan Agreement" means the Loan Agreement between the
Authority and the Company dated as of May 1, 1983 entered into in connection
with the Refunded Bonds.
"Refunded Bonds Trustee" means The Bank of New York (formerly Irving
Trust Company), as trustee under the Refunded Bonds Indenture.
"Refunding Fund" means the Refunding Fund created in the Indenture.
"Register" means the books kept and maintained for the registration and
transfer of Bonds pursuant to Section 3.05 of the Indenture.
"Registrar" means the Registrar as defined in the Indenture.
"Revenues" means (a) the Loan Payments, (b) all other moneys received or
to be received by the Authority (excluding the Authority Fee) or the Trustee in
respect of repayment of the Loan, including without limitation, all moneys and
investments in the Bond Fund, (c) any moneys and investments in the Refunding
Fund (until applied to the redemption of the Refunded Bonds), and (d) all income
and profit from the investment of the foregoing moneys. The term "Revenues"
does not include any moneys or investments in the Rebate Fund.
"Solid Waste Facility" or "Solid Waste Facilities" means those
facilities which are solid waste facilities as defined in Section 6123.01, Ohio
Revised Code.
"State" means the State of Ohio.
"Supplemental Mortgage Indenture" means the Thirty-fifth Supplemental
Indenture, dated as of January 1, 1994, between the Company and the Company
Mortgage Trustee, as amended or supplemented from time to time.
"Trustee" means The Bank of New York, New York, New York, a corporation
duly organized and validly existing under the laws of the State of New York,
until a successor Trustee shall have become such pursuant to the applicable
provisions of the Indenture, and thereafter "Trustee" shall mean the successor
Trustee. "Principal Office" of the Trustee shall mean the principal corporate
trust office of the Trustee, which office at the date of issuance of the Bonds
is located at its Notice Address.
"Unassigned Authority's Rights" means all of the rights of the Authority
to receive Additional Payments under Section 4.2 hereof, to access and inspect
pursuant to Section 5.1 hereof, to be held harmless and indemnified under
Section 5.9 hereof, to take certain corrective measures as provided in Section
5.11 hereof, to be reimbursed for attorney's fees and expenses under Section 7.4
hereof and to give or withhold consent to amendments, changes, modifications,
alterations and termination of this Agreement under Section 8.6 hereof and its
right to enforce such rights.
"Waste Water Facility" or "Waste Water Facilities" means those
facilities which are waste water facilities as defined in Section 6121.01, Ohio
Revised Code.
Section 1.3. Interpretation. Any reference herein to the State, to the
Authority or to any member or officer of either includes entities or officials
succeeding to their respective functions, duties or responsibilities pursuant to
or by operation of law or lawfully performing their functions.
Any reference to a section or provision of the Constitution of the State
or the Act, or to a section, provision or chapter of the Ohio Revised Code, or
to any statute of the United States of America, includes that section, provision
or chapter as amended, modified, revised, supplemented or superseded from time
to time; provided, that no amendment, modification, revision, supplement or
superseding section, provision or chapter shall be applicable solely by reason
of this provision, if it constitutes in any way an impairment of the rights or
obligations of the Authority, the State, the Holders, the Trustee, the
Registrar, an Authenticating Agent, a Paying Agent or the Company under this
Agreement, the Indenture, the Bonds, the Company Mortgage, the Supplemental
Mortgage Indenture or the First Mortgage Bonds.
Unless the context indicates otherwise, words importing the singular
number include the plural number, and vice versa; the terms "hereof", "hereby",
"herein", "hereto", "hereunder" and similar terms refer to this Agreement; and
the term "hereafter" means after, and the term "heretofore" means before, the
date of delivery of the Bonds. Words of any gender include the correlative
words of the other genders, unless the sense indicates otherwise.
Section 1.4. Captions and Headings. The captions and headings in this
Agreement are used solely for convenience of reference and in no way define,
limit or describe the scope or intent of any Articles, Sections, subsections,
paragraphs or subparagraphs or clauses hereof.
(End of Article I)
ARTICLE II
REPRESENTATIONS
Section 2.1. Representations of the Authority. The Authority
represents that: (a) it is a body politic and corporate duly organized and
validly existing under the laws of the State; (b) it has duly accomplished all
conditions necessary to be accomplished by it prior to the issuance and delivery
of the Bonds and the execution and delivery of this Agreement and the Indenture;
(c) it is not in violation of or in conflict with any provisions of the laws of
the State which would impair its ability to carry out its obligations contained
in this Agreement or the Indenture; (d) it is empowered to enter into the
transactions contemplated by this Agreement and the Indenture; (e) it has duly
authorized the execution, delivery and performance of this Agreement and the
Indenture; and (f) it will do all things in its power in order to maintain its
existence or assure the assumption of its obligations under this Agreement and
the Indenture by any successor public body.
Section 2.2. No Warranty by Authority of Condition or Suitability of
the Project. The Authority makes no warranty, either express or implied, as to
the suitability or utilization of the Project for the Project Purposes, or as to
the condition of the Project Facilities or that the Project Facilities are or
will be suitable for the Company's purposes or needs.
Section 2.3. Representations and Covenants of the Company. The Company
represents that:
(a) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State, with power and authority (corporate and other) to own its
properties and conduct its business, to execute and deliver this
Agreement, the Supplemental Mortgage Indenture and the First
Mortgage Bonds, and to perform its obligations under this
Agreement, the Company Mortgage, the Supplemental Mortgage
Indenture and the First Mortgage Bonds.
(b) This Agreement, the Supplemental Mortgage Indenture and
the Company Mortgage have been duly authorized, executed and
delivered by the Company; the First Mortgage Bonds have been duly
authorized, executed, issued and delivered; and this Agreement,
the Supplemental Mortgage Indenture, the Company Mortgage and the
First Mortgage Bonds constitute valid and legally binding
obligations of the Company, enforceable in accordance with their
respective terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights, to laws
relating to or affecting the enforcement of the security provided
by the Company Mortgage and to general equity principles.
(c) The execution, delivery and performance by the Company of
this Agreement and the Supplemental Mortgage Indenture and the
consummation of the transactions contemplated hereby and thereby
will not violate any provision of law or regulation applicable to
the Company, or of any writ or decree of any court or
governmental instrumentality, or of the Articles of
Incorporation, as amended, or the Regulations of the Company, or
of any mortgage, indenture, contract, agreement or other
undertaking to which the Company is a party or which purports to
be binding upon the Company or upon any of its assets.
(d) Substantially all (at least 90%) of the proceeds of the
Refunded Bonds were used to provide "water pollution control
facilities" and "solid waste disposal facilities" within the
meaning of Sections 103(b)(4)(E) and (F) of the 1954 Code, the
original use of which facilities commenced with the Company and
all of the proceeds of the Refunded Bonds have been spent for the
Project or to pay costs of issuance of the Refunded Bonds. The
proceeds of the Bonds (other than any accrued interest thereon)
will be used exclusively to refund the Refunded Bonds and none of
the proceeds of the Bonds will be used to pay for any costs of
issuance of the Bonds. The Refunded Bonds were issued prior to
August 16, 1986. The principal amount of the Bonds does not
exceed the outstanding principal amount of the Refunded Bonds.
The proceeds of the Bonds will be used to retire the Refunded
Bonds not later than 90 days after the date of issuance of the
Bonds.
(e) Either the acquisition and construction of the Project
Facilities financed with the Refunded Bonds, was not commenced
(within the meaning of Treasury Regulations Section 1.103-8(a)(5) as
applicable to the Refunded Bonds) prior to the adoption of the
respective resolutions of the Authority evidencing the intent of
the Authority to issue those Refunded Bonds (being March 11, 1976
with respect to the financing for the Killen Project Unit and
October 8, 1981 with respect to the financing for the Walter C.
Beckjord Project Unit and the Miami Fort Project Unit), or, any
proceeds of the corresponding Refunded Bonds used to pay costs
incurred prior to the adoption of such corresponding resolution
have been treated for purposes of this Agreement as having been
used to provide working capital (not land or depreciable
property) to the Company.
(f) It has caused the Project to be substantially completed.
The Project constitutes a combined Waste Water Facility and Solid
Waste Facility under the Act and is consistent with the purposes
of Section 13 of Article VIII of the Ohio Constitution and of the
Act. The Project is being, and the Company will cause the
Project to be, operated and maintained in such manner to conform
with all applicable zoning, planning, building, environmental and
other applicable governmental regulations and all permits,
variances and orders issued or granted pursuant thereto,
including the permit-to-install for the Project, which permits,
variances and orders have not been withdrawn or otherwise
suspended, and to be consistent with the Act.
(g) It has used or operated or has caused to be used or
operated, and presently intends to use or operate or cause to be
used or operated the Project Facilities in a manner consistent
with the Project Purposes until the date on which the Bonds have
been fully paid and knows of no reason why the Project Facilities
will not be so operated. The Company does not intend to sell or
otherwise dispose of the Project or any portion thereof.
(h) None of the proceeds of the Refunded Bonds were used and
none of the proceeds of the Bonds will be used to provide any
private or commercial golf course, country club, massage parlor,
tennis club, skating facility (including roller skating,
skateboard and ice skating), racquet sports facility (including
handball or racquetball court), hot tub facility, suntan
facility, racetrack, airplane, skybox or other private luxury
box, or health club facility; any facility primarily used for
gambling; any store the principal business of which is the sale
of alcoholic beverages for consumption off premises; or any
facilities for retail food and beverage services (except grocery
stores), automobile sales or service, or the provision of
recreation or entertainment.
(i) Less than 25% of the proceeds of the Refunded Bonds have
been used and less than 25% of the proceeds of the Bonds will be
used directly or indirectly to acquire land or any interest
therein, and none of such proceeds has been or will be used to
provide land which is to be used for farming purposes.
(j) No portion of the proceeds of the Refunded Bonds has been
used and no portion of the proceeds of the Bonds will be used to
acquire existing property or any interest therein unless the
first use of such property was by the Company and was pursuant to
and followed such acquisition.
(k) After the expiration of any applicable temporary period
under Section 148(d)(3) of the Code, at no time during any bond
year will the aggregate amount of gross proceeds of the 1994
Bonds invested in higher yielding investments (within the meaning
of Section 148(b) of the Code) exceed 150 percent of the debt
service on the 1994 Bonds for such bond year and the aggregate
amount of gross proceeds of the 1994 Bonds invested in higher
yielding investments, if any, will be promptly and appropriately
reduced as the outstanding amount of the 1994 Bonds is reduced,
provided however that the foregoing shall not require the sale or
disposition of any investments in higher yielding investments if
such sale or disposition would result in a loss which exceeds the
amount which would be paid to the United States (but for such
sale or disposition) at the time of such sale or disposition if a
payment were due at such time. At no time will any funds
constituting gross proceeds of the 1994 Bonds be used in a manner
as would constitute failure of compliance with Section 148 of the
Code.
The terms "bond year", "gross proceeds", "higher yielding
investments", "yield", and "debt service" have the meanings
assigned to them for purposes of Section 148 of the Code.
(l) The Refunded Bonds were not, and the Bonds will not be,
"federally guaranteed" within the meaning of Section 149(b) of
the Code.
(m) It is not anticipated that as of the date hereof, there
will be created any "replacement proceeds", within the meaning of
Section 1.148-1(c) of the Treasury Regulations, with respect to
the 1994 Bonds; however, in the event that any such replacement
proceeds are deemed to have been created, such amounts will be
invested in compliance with Section 148 of the Code.
(n) On the date of issuance and delivery of the Refunded
Bonds, the Company reasonably expected that all of the proceeds
of such Refunded Bonds would be used to carry out the
governmental purposes of each such issue within the 3-year period
beginning on the date each such issue was issued and none of the
proceeds of each such issue, if any, were invested in nonpurpose
investments having a substantially guaranteed yield for 3 years
or more.
(o) The average maturity of the 1994 Bonds does not exceed
120% of the average reasonably expected economic life of the
facilities financed or refinanced by the 1994 Bonds (determined
under Section 147(b) of the Code).
(p) The information furnished by the Company and used by the
Authority in preparing the certifications and statements pursuant
to Sections 148 and 149(e) of the Code or their statutory
predecessors with respect to the Refunded Bonds was accurate and
complete as of the dates of issuance of the Refunded Bonds, and
the information furnished by the Company and used by the
Authority in preparing the certification pursuant to Section 148
of the Code and in preparing the information statement pursuant
to Section 149(e) of the Code, both referred to in the Bond
Resolution, will be accurate and complete as of the date of
issuance of the Bonds.
(q) The Project Facilities do not include any office except
for offices (i) located on the Project Site and (ii) not more
than a de minimis amount of the functions to be performed at
which is not directly related to the day-to-day operations of the
Project Facilities.
(End of Article II)
ARTICLE III
COMPLETION OF THE PROJECT;
ISSUANCE OF THE BONDS
Section 3.1. Acquisition, Construction and Installation. The Company
represents that it and the other public utility companies which own undivided
interests in the Project Facilities with the Company as tenants-in-common have
caused the Project Facilities to be acquired, constructed and installed on the
applicable Project Sites, substantially in accordance with the Project
Description and in conformance with all applicable zoning, planning, building
and other similar regulations of all governmental authorities having
jurisdiction over the Project and all permits, variances and orders issued in
respect of the Project by EPA, and that the proceeds derived from the Refunded
Bonds, including any investment thereof, were expended in accordance with the
Refunded Bonds Indenture and the Refunded Bonds Loan Agreement.
Section 3.2. Project Description. The Project Description may be
changed from time to time by, or with the consent of, the Company provided that
any such change shall also be filed with the Authority and provided further that
no change in the Project Description shall materially change the function of the
Project Facilities unless the Trustee shall have received (i) an Engineer's
certificate that such changes will not impair the significance or character of
the Project Facilities as Waste Water Facilities and/or Solid Waste Facilities
and (ii) an Opinion of Bond Counsel or ruling of the Internal Revenue Service to
the effect that such amendment will not adversely affect the exclusion of
interest on the Bonds from gross income for federal income tax purposes.
Section 3.3. Issuance of the Bonds; Application of Proceeds. To
provide funds to make the Loan to the Company to assist the Company in the
refunding of the Refunded Bonds, concurrently with the delivery to the Trustee
of the First Mortgage Bonds as provided in Section 4.1 hereof, the Authority
will issue, sell and deliver the Bonds to the Original Purchaser. The Bonds
will be issued pursuant to the Indenture in the aggregate principal amount, will
bear interest, will mature and will be subject to redemption as set forth
therein. The Company hereby approves the terms and conditions of the Indenture
and the Bonds, and the terms and conditions under which the Bonds will be
issued, sold and delivered.
The proceeds from the sale of the Bonds (other than any accrued
interest) shall be loaned to the Company to assist the Company in refunding the
Refunded Bonds in order to reduce the interest cost payable by the Company and
shall be deposited in the Refunding Fund and disbursed as follows: all of the
proceeds of the Bonds (other than any accrued interest) will be deposited in the
Refunding Fund (as created and defined in the Indenture) and on February 14,
1994 all moneys on deposit in the Refunding Fund shall be deposited in the Bond
Fund created in the Refunded Bonds Indenture and applied by the Refunded Bonds
Trustee to the payment of principal of, redemption premium and interest on the
Refunded Bonds on February 15, 1994.
Pending disbursement pursuant to this Section, the proceeds so deposited
in the Refunding Fund, together with any investment earnings there on, shall
constitute a part of the Revenues assigned by the Authority to the Trustee for
the payment of Bond Service Charges. Any accrued interest shall be deposited in
the Bond Fund.
The Company hereby requests that the Authority notify the Refunded Bonds
Trustee that the entire outstanding principal amount of the Refunded Bonds is to
be redeemed on February 15, 1994 at a redemption price of 103% of the principal
amount thereof plus accrued interest to the redemption date.
Section 3.4. Investment of Fund Moneys. At the oral (confirmed
promptly in writing) or written request of the Company, any moneys held as part
of the Bond Fund, the Refunding Fund or the Rebate Fund shall be invested or
reinvested by the Trustee in Eligible Investments; provided, that such moneys
shall be invested or reinvested by the Trustee only in Eligible Investments
which shall mature, or which shall be subject to redemption by the holder
thereof at the option of such holder, not later than the date upon which the
moneys so invested are needed to make payments from those Funds. The Authority
(to the extent it retained or retains direction or control) and the Company each
hereby represents that the investment and reinvestment and the use of the
proceeds of the Refunded Bonds were restricted in such manner and to such extent
as was necessary so that the Refunded Bonds would not constitute arbitrage bonds
under the statutory predecessor of the Code and each hereby covenants that it
will restrict that investment and reinvestment and the use of the proceeds of
the Bonds in such manner and to such extent, if any, as may be necessary so that
the Bonds will not constitute arbitrage bonds under Section 148 of the Code.
The Company shall provide the Authority with, and the Authority may base
its certificate and statement, each as authorized by the Bond Resolution, on a
certificate of an appropriate officer, employee or agent of or consultant to the
Company for inclusion in the transcript of proceedings for the Bonds, setting
forth the reasonable expectations of the Company on the date of delivery of and
payment for the Bonds regarding the amount and use of the proceeds of the Bonds
and the facts, estimates and circumstances on which those expectations are
based.
Section 3.5. Rebate Fund. To the extent required by Section 5.09 of
the Indenture, within five days after the end of the fifth Bond Year (as defined
in the Indenture) and every fifth Bond Year thereafter, and within five days
after payment in full of all outstanding Bonds, the Company shall calculate the
amount of Excess Earnings (as defined in the Indenture) as of the end of that
Bond Year or the date of such payment and shall notify the Trustee of that
amount. If the amount then on deposit in the Rebate Fund created under the
Indenture is less than the amount of Excess Earnings (computed by taking into
account the amount or amounts, if any, previously paid to the United States
pursuant to Section 5.09 of the Indenture and this Section), the Company shall,
within five days after the date of the aforesaid calculation, pay to the Trustee
for deposit in the Rebate Fund an amount sufficient to cause the Rebate Fund to
contain an amount equal to the Excess Earnings. The obligation of the Company
to make such payments shall remain in effect and be binding upon the Company
notwithstanding the release and discharge of the Indenture. The Company shall
obtain and keep such records of the computations made pursuant to this Section
as are required under Section 148(f) of the Code.
(End of Article III)
ARTICLE IV
LOAN BY AUTHORITY; LOAN PAYMENTS;
ADDITIONAL PAYMENTS; AND FIRST MORTGAGE BONDS
Section 4.1. Loan Repayment; Delivery of First Mortgage Bonds. Upon
the terms and conditions of this Agreement, the Authority agrees to make the
Loan to the Company. The proceeds of the Loan shall be deposited with the
Trustee pursuant to Section 3.3 hereof. As evidence of its obligation hereunder
to repay the Loan, the Company agrees to execute and deliver the First Mortgage
Bonds to the Authority, in the manner provided in Section 4.6 hereof. In
consideration of and in repayment of the Loan, the Company shall make, as Loan
Payments, to the Trustee for the account of the Authority, payments on the First
Mortgage Bonds which correspond, as to time, and are equal in amount, to the
Bond Service Charges payable on the Bonds. All Loan Payments received by the
Trustee shall be held and disbursed in accordance with the provisions of the
Indenture and this Agreement for application to the payment of Bond Service
Charges.
The Company shall be entitled to a credit against the Loan Payments
required to be made on any Loan Payment Date to the extent that the balance of
the Bond Fund is then in excess of amounts required (a) for the payment of Bonds
theretofore matured or theretofore called for redemption, or to be called for
redemption pursuant to Section 6.1 hereof (b) for the payment of interest for
which checks or drafts have been drawn and mailed by the Trustee or Paying
Agent, and (c) to be deposited in the Bond Fund by the Indenture for use other
than for the payment of Bond Service Charges due on that Loan Payment Date.
Except for such interest of the Company as may hereafter arise pursuant
to Section 8.2 hereof or Sections 5.07 or 5.08 of the Indenture, the Company and
the Authority each acknowledge that neither the Company, the State nor the
Authority has any interest in the Bond Fund, and any moneys deposited therein
shall be in the custody of and held by the Trustee in trust for the benefit of
the Holders.
Section 4.2. Additional Payments. The Company shall pay to the
Authority, the Authority Fee and, as Additional Payments hereunder, any and all
costs and expenses incurred or to be paid by the Authority in connection with
the issuance and delivery of the Bonds or otherwise related to actions taken by
the Authority under this Agreement or the Indenture.
The Company shall pay the Administration Expenses to the Trustee, the
Registrar, and any Paying Agent or Authenticating Agent, as appropriate, as
Additional Payments hereunder.
The Company may, without creating a default hereunder, contest in good
faith the reasonableness of any such cost or expense incurred or to be paid by
the Authority and any Administration Expenses claimed to be due to the Trustee,
the Registrar, any Paying Agent or any Authenticating Agent.
In the event the Company should fail to pay any Loan Payments or
Additional Payments (including Administration Expenses) when due, the payment in
default shall continue as an obligation of the Company until the amount in
default shall have been fully paid together with interest thereon during the
default period at the Interest Rate for Advances.
Section 4.3. Place of Payments. The Company shall make all Loan
Payments directly to the Trustee at its Principal Office. Additional Payments
shall be made directly to the person or entity to whom or to which they are due.
Section 4.4. Obligations Unconditional. The obligations of the Company
to make Loan Payments, Additional Payments (including Administration Expenses)
and any payments required of the Company under Section 5.09 of the Indenture
shall be absolute and unconditional, and the Company shall make such payments
without abatement, diminution or deduction regardless of any cause or
circumstances whatsoever including, without limitation, any defense, set-off,
recoupment or counterclaim which the Company may have or assert against the
Authority, the Trustee, the Registrar or any other Person.
Section 4.5. Assignment of Revenues, Agreement and First Mortgage
Bonds. To secure the payment of Bond Service Charges, the Authority shall
absolutely assign to the Trustee, its successors in trust and its and their
assigns forever, by the Indenture, all right, title and interest of the
Authority in and to (a) the Revenues, including, without limitation, all Loan
Payments and other amounts receivable by or on behalf of the Authority under the
Agreement in respect of repayment of the Loan, (b) the Agreement except for the
Unassigned Authority's Rights, and (c) the First Mortgage Bonds. The Company
hereby agrees and consents to those assignments.
Section 4.6. First Mortgage Bonds. To evidence and secure the
obligations of the Company to make the Loan Payments and repay the Loan, the
Company will, concurrently with the issuance of the Bonds, execute and deliver
First Mortgage Bonds to the Authority in an aggregate principal amount equal to
the aggregate principal amount of the Bonds. The Company agrees that First
Mortgage Bonds authorized pursuant to the Company Mortgage will be issued
containing the terms and conditions and in substantially the form set forth in
the Supplemental Mortgage Indenture. The First Mortgage Bonds shall:
(a) provide for payments of interest equal to the payments of
interest on the Bonds;
(b) provide for payments of principal and any premium equal
to the payments of principal (whether at maturity or by call for
mandatory or optional redemption or pursuant to acceleration or
otherwise) and any premium on the Bonds;
(c) require all such payments on such First Mortgage Bonds to
be made on or prior to the due date for the corresponding
payments to be made on the Bonds; and
(d) contain redemption provisions corresponding with such
provisions of the Bonds.
Unless the Company is entitled to a credit under this Agreement or the
Indenture, all payments on the First Mortgage Bonds shall be in the full amount
required thereunder. The First Mortgage Bonds shall be registered in the name
of the Trustee and shall not be transferred by the Trustee, except to effect
transfers to any successor trustee under the Indenture.
(End of Article IV)
ARTICLE V
ADDITIONAL AGREEMENTS AND COVENANTS
Section 5.1. Right of Access. The Company agrees that, subject to
reasonable security and safety regulations and to reasonable requirements as to
notice, the Authority and the Trustee and their or any of their respective duly
authorized agents shall have the right at all reasonable times to enter upon the
Project Site to examine and inspect the Project. The Company further agrees
that the Authority and its duly authorized agents shall have such rights of
access to the Project Site as may be reasonably necessary to enable the
Authority to exercise its rights under Section 5.11 hereof, and for such purpose
the Company has executed and delivered to the Authority a good and sufficient
deed of easement pertaining to the Project Site. The Company warrants and
represents that it has good and sufficient title to the Project Site to permit
the maintenance and operation of the Project as contemplated herein.
Section 5.2. Maintenance. The Company shall use its best efforts to
keep and maintain the Project Facilities, including all appurtenances thereto
and any personal property therein or thereon, in good repair and good operating
condition so that the Project Facilities will continue to constitute Waste Water
Facilities and/or Solid Waste Facilities, for the purposes of the operation
thereof as required by Section 5.4 hereof.
So long as such shall not be in violation of the Act or impair the
character of the Project Facilities as Waste Water Facilities and/or Solid Waste
Facilities, and provided there is continued compliance with applicable laws and
regulations of governmental entities having jurisdiction thereof, the Company
shall have the right to remodel the Project Facilities or make additions,
modifications and improvements thereto, from time to time as it, in its
discretion, may deem to be desirable for its uses and purposes, the cost of
which remodeling, additions, modifications and improvements shall be paid by the
Company and the same shall, when made, become a part of the Project Facilities.
Section 5.3. Removal of Portions of the Project Facilities. The
Company shall not be under any obligation to renew, repair or replace any
inadequate, obsolete, worn out, unsuitable, undesirable or unnecessary portions
of the Project Facilities, except that, subject to Section 5.4 hereof, it will
use its best efforts to ensure the continued character of the Project Facilities
as Waste Water Facilities and/or Solid Waste Facilities. The Company shall have
the right from time to time to substitute personal property or fixtures for any
portions of the Project Facilities, provided that the personal property or
fixtures so substituted shall not impair the character of the Project Facilities
as Waste Water Facilities and/or Solid Waste Facilities. Any such substituted
property or fixtures shall, when so substituted, become a part of the Project
Facilities. The Company shall also have the right to remove any portion of the
Project Facilities, without substitution therefor; provided, that the Company
shall deliver to the Trustee a certificate signed by an Engineer describing said
portion of the Project Facilities and stating that the removal of such property
or fixtures will not impair the character of the Project Facilities as Waste
Water Facilities and/or Solid Waste Facilities.
Section 5.4. Operation of Project Facilities. The Company will,
subject to its obligations and rights to maintain, repair or remove portions of
the Project Facilities, as provided in Sections 5.2 and 5.3 hereof, use its best
efforts to continue operation of the Project Facilities so long as and to the
extent that operation thereof is required to comply with laws or regulations of
governmental entities having jurisdiction thereof or unless the Authority shall
have approved the discontinuance of such operation (which approval shall not be
unreasonably withheld). The Company agrees that it will, within the design
capacities thereof, use its best efforts to operate and maintain the Project
Facilities in accordance with all applicable, valid and enforceable rules and
regulations of governmental entities having jurisdiction thereof; provided, that
the Company reserves the right to contest in good faith any such laws or
regulations. The Company agrees that sufficient qualified operating personnel
will be retained and operational tests and measurements necessary to determine
compliance with the preceding sentence will be performed to insure proper and
efficient operation and maintenance of the Project Facilities.
Nothing in this Agreement shall prevent or restrict the Company, in its
sole discretion, at any time, from discontinuing or suspending either
permanently or temporarily its use of any facility of the Company served by the
Project Facilities and in the event such discontinuance or suspension shall
render unnecessary the continued operation of the Project Facilities, the
Company shall have the right to discontinue the operation of the Project
Facilities during the period of any such discontinuance or suspension.
Section 5.5. Insurance. The Company agrees to insure its interest in
the Project Facilities in the amount and with the coverage required by the
Company Mortgage.
Section 5.6. Workers' Compensation Coverage. Throughout the term of
this Agreement, the Company shall comply, or cause compliance, with applicable
workers' compensation laws of the State.
Section 5.7. Damage; Destruction and Eminent Domain. If, during the
term of this Agreement, the Project Facilities or any portion thereof is
destroyed or damaged in whole or in part by fire or other casualty, or title to,
or the temporary use of, the Project Facilities or any portion thereof shall
have been taken by the exercise of the power of eminent domain, and the Company
or the Company Mortgage Trustee receives net proceeds from insurance or any
condemnation award in connection therewith, the Company (unless it shall have
exercised its option to prepay the Loan Payments pursuant to provisions of
Section 6.2 hereof), to the extent required to comply with applicable laws and
regulations with respect to the operations of facilities of the Company served
by the Project, shall promptly cause such net proceeds or an amount equal
thereto to be used to repair, rebuild or restore the portion of the Project
Facilities so damaged, destroyed or taken with such changes, alterations and
modifications (including the substitution and addition of other property) as may
be necessary or desirable for the administration and operation of the Project
Facilities as Waste Water Facilities and/or Solid Waste Facilities and as shall
not impair the character or significance of the Project Facilities as furthering
the purposes of the Act. It is hereby acknowledged and agreed that any net
proceeds from insurance or any condemnation award relating to the Project
Facilities are subject to the lien of the Company Mortgage and shall be disposed
of in accordance with the terms and provisions of the Company Mortgage and that
any obligations of the Company under this Section 5.7 not satisfied by
application of such net proceeds shall be limited to the general credit of the
Company and does not require disposition of such net proceeds contrary to the
requirements of the Company Mortgage.
Section 5.8. Company to Maintain its Corporate Existence; Conditions
Under Which Exceptions Permitted. The Company agrees that during the term of
this Agreement it will maintain its corporate existence and will not sell its
electric properties as an entirety or substantially as an entirety or
consolidate with or merge into another corporation or permit one or more other
corporations to consolidate with or merge into it, except to the extent
permitted under the provisions of the Company Mortgage, provided that any
successor corporation resulting from any such sale, consolidation or merger
shall assume all obligations of the Company arising under or contemplated by the
provisions of this Agreement.
If consolidation, merger or sale or other transfer is made as provided
in this Section, the provisions of this Section shall continue in full force and
effect and no further consolidation, merger or sale or other transfer shall be
made except in compliance with the provisions of this Section.
Section 5.9. Indemnification. The Company releases the Authority from,
agrees that the Authority shall not be liable for, and indemnifies the Authority
against, all liabilities, claims, costs and expenses imposed upon or asserted
against the Authority on account of: (a) any loss or damage to property or
injury to or death of or loss by any person that may be occasioned by any cause
whatsoever pertaining to the construction, maintenance, operation and use of the
Project Facilities; (b) any breach or default on the part of the Company in the
performance of any covenant or agreement of the Company under this Agreement or
any related document, or arising from any act or failure to act by the Company,
or any of its agents, contractors, servants, employees or licensees; (c) the
authorization, issuance and sale of the Bonds, and the provision of any
information furnished in connection therewith concerning the Project Facilities
or the Company (including, without limitation, any information furnished by the
Company for inclusion in any certifications made by the Authority under Section
3.4 hereof or for inclusion in, or as a basis for preparation of, the
information statements filed by the Authority pursuant to Section 8(a)(ii) of
the Bond Resolution); and (d) any claim or action or proceeding with respect to
the matters set forth in (a), (b) and (c) above brought thereon; provided that
if the Authority has exercised its rights to operate and maintain the Project
Facilities under Section 5.11 hereof, the Company shall not be obligated to
indemnify the Authority against any loss or damage to, or any injury or death
of, any person if that loss, damage, injury or death results from the gross
negligence or willful misconduct of the Authority or its agents or employees.
The Company agrees to indemnify the Trustee, the Paying Agent and the
Registrar (each hereinafter referred to in this section as an "indemnified
party") for and to hold each of them harmless against all liabilities, claims,
costs and expenses incurred without negligence or willful misconduct on the part
of the indemnified party, on account of any action taken or omitted to be taken
by the indemnified party in accordance with the terms of this Agreement, the
Bonds or the Indenture or any action taken at the request of or with the consent
of the Company, including the costs and expenses of the indemnified party in
defending itself against any such claim, action or proceeding brought in
connection with the exercise or performance of any of its powers or duties under
this Agreement, the Bonds or the Indenture or any action taken at the request of
or with the consent of the Company.
In case any action or proceeding is brought against the Authority or an
indemnified party in respect of which indemnity may be sought hereunder, the
party seeking indemnity promptly shall give notice of that action or proceeding
to the Company, and the Company upon receipt of that notice shall have the
obligation and the right to assume the defense of the action or proceeding;
provided, that failure of a party to give that notice shall not relieve the
Company from any of its obligations under this Section unless that failure
prejudices the defense of the action or proceeding by the Company. At its own
expense, an indemnified party may employ separate counsel and participate in the
defense; provided, however, where it is ethically inappropriate for one firm to
represent the interests of the Authority and any other indemnified party or
parties, the Company shall pay the Authority's legal expenses in connection with
the Authority's retention of separate counsel. The Company shall not be liable
for any settlement made without its consent.
The indemnification set forth above is intended to and shall include the
indemnification of all affected officials, directors, officers and employees of
the Authority, the Trustee, the Paying Agent and the Registrar, respectively.
That indemnification is intended to and shall be enforceable by the Authority,
the Trustee, the Paying Agent and the Registrar, respectively, to the full
extent permitted by law.
Section 5.10. Company Not to Adversely Affect Exclusion of Interest on
Bonds From Gross Income For Federal Income Tax Purposes. The Company hereby
covenants and represents that it has taken and caused to be taken and shall take
and cause to be taken all actions that may be required of it for the interest on
the 1994 Bonds to be and remain excluded from the gross income of the Holders
for federal income tax purposes, and that it has not taken or permitted to be
taken on its behalf, and covenants that it will not take, or permit to be taken
on its behalf, any action which, if taken, would adversely affect that exclusion
under the provisions of the Code.
Section 5.11. Operation and Maintenance. In the event the Company
shall fail (i) to cause the Project Facilities to be kept in good repair and
operating condition, or (ii) to use its best efforts to cause the Project
Facilities to be operated in accordance with Section 5.4 hereof, the Authority
after 30 days' written notice to the Company specifying the particular failure
and the corrective measures which the Authority proposes to take and the refusal
by the Company to take such corrective measures as are needed to insure
compliance with Section 5.4 hereof, may take (but shall not be required to),
subject to all requirements and restrictions under which the production facility
served by the Project Facilities is operated, such corrective measures,
including employment of operating personnel (who must be approved by and act
under the direction and control of the Company) but excluding any curtailment in
whole or in part of the operation of the production facility served by the
Project Facilities other than to permit the repair of the Project Facilities, as
are specified in said notice to insure compliance with Section 5.4 hereof, and
provide for payment thereof. Any expenditures incurred by the Authority in
connection with its undertaking corrective measures pursuant to the provisions
of this Section, including without limitation the costs of any public liability
insurance which the Authority obtains in connection with such undertaking, shall
become an additional obligation of the Company to the Authority which, together
with interest thereon at the Interest Rate for Advances from the date such
expenditures are incurred by the Authority, the Company agrees to pay.
In the event the Authority exercises its right to take such corrective
measures, the Authority shall cease taking such measures and withdraw any
operating personnel from the Project Facilities at the earlier of (i) the time
as of which the Project Facilities have been restored to proper operating
condition or as of which proper operation of the Project Facilities has been
resumed by the Company or (ii) unless there exists an Event of Default under
Section 7.1(a) hereof, two months from the date on which such corrective
measures were originally taken.
Section 5.12. Use of Project Facilities. The Authority agrees that it
will not take any action, or cause any action to be taken on its behalf, to
interfere with the Company's ownership interest in the Project or to prevent the
Company from having possession, custody, use and enjoyment of the Project other
than pursuant to Section 5.11 or Article VII of this Agreement or Article VII of
the Indenture.
Section 5.13. Assignment by Company. This Agreement may be assigned in
whole or in part by the Company without the necessity of obtaining the consent
of either the Authority or the Trustee, subject, however, to each of the
following conditions:
(a) No assignment (other than pursuant to Section 5.8 hereof)
shall relieve the Company from primary liability for any of its
obligations hereunder, and in the event of any such assignment
the Company shall continue to remain primarily liable for the
payment of the Loan Payments and Additional Payments and for
performance and observance of the agreements on its part herein
provided to be performed and observed by it.
(b) Any assignment by the Company must retain for the Company
such rights and interests as will permit it to perform its
obligations under this Agreement, and any assignee from the
Company shall assume the obligations of the Company hereunder to
the extent of the interest assigned.
(c) The Company shall, within 30 days after execution
thereof, furnish or cause to be furnished to the Authority and
the Trustee a true and complete copy of each such assignment
together with any instrument of assumption.
(d) Any assignment from the Company shall not materially
impair fulfillment of the Project Purposes to be accomplished by
operation of the Project as herein provided.
Section 5.14. Agreements with Bond Insurer. So long as the Bond
Insurance Policy is in full force and effect with respect to the Bonds and the
Bond Insurer is not in default thereunder as defined in Section 7.10 of the
Indenture, the following provisions shall apply:
(a) Any action requiring the approval or consent of the
Holders, the Authority, the Trustee or the Company under the
Agreement shall also require the prior written consent of the
Bond Insurer.
(b) The Company shall provide the Bond Insurer annually with
copies of the Company's audited financial statements.
(c) Upon the occurrence and continuance of an Event of
Default hereunder, the Bond Insurer shall have the same right as
the Authority and the Trustee to pursue the remedies provided in
Sections 7.2 and 7.3 hereof; and
(d) The Company shall give notice to the Bond Insurer, not
less than two days prior to any Loan Payment Date, if the Company
does not intend or will be unable to make the Loan Payment on
that Loan Payment Date.
(End of Article V)
ARTICLE VI
REDEMPTION
Section 6.1. Optional Redemption. Provided no Event of Default shall
have occurred and be subsisting, at any time and from time to time, the Company
may deliver moneys to the Trustee in addition to Loan Payments or Additional
Payments required to be made and direct the Trustee to use the moneys so
delivered for the purpose of calling Bonds for optional redemption in accordance
with the applicable provisions of the Indenture providing for optional
redemption at the redemption price stated in the Indenture. Pending application
for those purposes, any moneys so delivered shall be held by the Trustee in a
special account in the Bond Fund and delivery of those moneys shall not, except
as set forth in Section 4.1 hereof, operate to abate or postpone Loan Payments
or Additional Payments otherwise becoming due or to alter or suspend any other
obligations of the Company under this Agreement.
Section 6.2. Extraordinary Optional Redemption. The Company shall
have, subject to the conditions hereinafter imposed, the option to direct the
redemption of the Bonds in whole in accordance with the applicable provisions of
the Indenture upon the occurrence of any of the following events:
(a) The Project or a Project Unit shall have been damaged or
destroyed to such an extent that (1) it cannot reasonably be
expected to be restored, within a period of six consecutive
months, to the condition thereof immediately preceding such
damage or destruction or (2) the Company is reasonably expected
to be prevented from carrying on its normal operations in
connection therewith for a period of six consecutive months.
(b) Title to, or the temporary use of, all or a significant
part of the Project or a Project Unit shall have been taken under
the exercise of the power of eminent domain (1) to such extent
that it cannot reasonably be expected to be restored within a
period of six consecutive months to a condition of usefulness
comparable to that existing prior to the taking or (2) to such an
extent that the Company is reasonably expected to be prevented
from carrying on its normal operations in connection therewith
for a period of six consecutive months.
(c) As a result of any changes in the Constitution of the
State, the Constitution of the United States of America or any
state or federal laws or as a result of legislative or
administrative action (whether state or federal) or by final
decree, judgment or order of any court or administrative body
(whether state or federal) entered after any contest thereof by
the Authority or the Company in good faith, this Agreement shall
have become void or unenforceable or impossible of performance in
accordance with the intent and purpose of the parties as
expressed in this Agreement.
(d) Unreasonable burdens or excessive liabilities shall have
been imposed upon the Authority or the Company with respect to
the Project or a Project Unit or the operation thereof,
including, without limitation, the imposition of federal, state
or other ad valorem, property, income or other taxes other than
ad valorem taxes at the rates presently levied upon privately
owned property used for the same general purpose as the Project
or a Project Unit.
(e) Changes in the economic availability of raw materials,
operating supplies, energy sources or supplies or facilities
(including, but not limited to, facilities in connection with the
disposal of industrial wastes) necessary for the operation of the
Project or a Project Unit for the Project Purposes occur or
technological or other changes occur which the Company cannot
reasonably overcome or control and which in the Company's
reasonable judgment render the Project or a Project Unit
uneconomic or obsolete for the Project Purposes.
(f) Any court or administrative body shall enter a judgment,
order or decree, or shall take administrative action, requiring
the Company to cease all or any substantial part of its
operations served by the Project or a Project Unit to such extent
that the Company is or will be prevented from carrying on its
normal operations at the Project or a Project Unit for a period
of six consecutive months.
(g) The termination by the Company of operations at a Project
Unit.
The amount payable by the Company in the event of its exercise of the
option granted in this Section shall be the sum of the following:
(i) An amount of money which, when added to the moneys and
investments held to the credit of the Bond Fund, will be
sufficient pursuant to the provisions of the Indenture to pay, at
100% of the principal amount thereof plus accrued interest to the
redemption date, and discharge, all Outstanding Bonds on the
earliest applicable redemption date, that amount to be paid to
the Trustee, plus
(ii) An amount of money equal to the Additional Payments
relating to those Bonds accrued and to accrue until actual final
payment and redemption of those Bonds, that amount or applicable
portions thereof to be paid to the Trustee or to the Persons to
whom those Additional Payments are or will be due.
The requirement of (ii) above with respect to Additional Payments to accrue may
be met if provisions satisfactory to the Trustee and the Authority are made for
paying those amounts as they accrue.
The rights and options granted to the Company in this Section may be
exercised whether or not the Company is in default hereunder; provided, that
such default will not relieve the Company from performing those actions which
are necessary to exercise any such right or option granted hereunder.
Section 6.3. Mandatory Redemption. The Company shall deliver to the
Trustee the moneys needed to redeem the Bonds in accordance with any mandatory
redemption provisions relating thereto as may be set forth in Section 4.01(b) of
the Indenture.
Section 6.4. Notice of Redemption. In order to exercise an option
granted in, or to consummate a redemption required by, this Article VI, the
Company shall, within 180 days following the event authorizing the exercise of
such option or at any time during the continuation of the condition referred to
in paragraphs (c), (d) or (e) of Section 6.2 hereof or promptly upon the
occurrence of a Determination of Taxability (as defined in the Indenture), give
written notice to the Authority, the Trustee and the Company Mortgage Trustee
that it is exercising its option to direct the redemption of Bonds, or that the
redemption thereof is required by Section 4.01(b) of the Indenture due to the
occurrence of a Determination of Taxability, as the case may be, in accordance
with the Agreement and the Indenture, and shall specify therein the date on
which such redemption is to be made, which date shall not be more than 180 days
from the date such notice is mailed. The Company shall make arrangements
satisfactory to the Trustee for the giving of the required notice of redemption
to the Holders of the Bonds, in which arrangements the Authority shall
cooperate. The Company shall make arrangements satisfactory to the Company
Mortgage Trustee to effect a concurrent redemption of an equivalent principal
amount of corresponding First Mortgage Bonds under the Supplemental Mortgage
Indenture.
Section 6.5. Actions by Authority. At the request of the Company or
the Trustee, the Authority shall take all steps required of it under the
applicable provisions of the Indenture or the Bonds to effect the redemption of
all or a portion of the Bonds pursuant to this Article VI.
Section 6.6. Concurrent Discharging of First Mortgage Bonds. In the
event any of the Bonds shall be paid and discharged, or deemed to be paid and
discharged, pursuant to any provisions of this Agreement and the Indenture, so
that such Bonds are not thereafter outstanding within the meaning of the
Indenture, a like principal amount of corresponding First Mortgage Bonds shall
be deemed fully paid for purposes of this Agreement and to such extent the
obligations of the Company hereunder shall be deemed terminated.
(End of Article VI)
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
Section 7.1. Events of Default. Each of the following shall be an
Event of Default:
(a) The occurrence of an event of default as defined in
Section 7.01 (a) or (b) of the Indenture;
(b) The Company shall fail to observe and perform any other
agreement, term or condition contained in this Agreement, other
than such failure as will have resulted in an event of default
described in (a) above and the continuation of that failure for a
period of 90 days after notice thereof shall have been given to
the Company by the Authority or the Trustee, or for such longer
period as the Authority and the Trustee may agree to in writing;
provided, that failure shall not constitute an Event of Default
so long as the Company institutes curative action within the
applicable period and diligently pursues that action to
completion; and
(c) The occurrence of a "completed default" as defined in the
Company Mortgage.
Notwithstanding the foregoing, if, by reason of Force Majeure, the
Company is unable to perform or observe any agreement, term or condition hereof
which would give rise to an Event of Default under subsection (b) hereof, the
Company shall not be deemed in default during the continuance of such inability.
However, the Company shall promptly give notice to the Trustee and the Authority
of the existence of an event of Force Majeure and shall use its best efforts to
remove the effects thereof; provided that the settlement of strikes or other
industrial disturbances shall be entirely within its discretion.
The term Force Majeure shall mean the following:
(i) acts of God; strikes, lockouts or other industrial
disturbances; acts of public enemies; orders or restraints of any
kind of the government of the United States of America or of the
State or any of their departments, agencies, political
subdivisions or officials, or any civil or military authority;
insurrections; civil disturbances; riots; epidemics; landslides;
lightning; earthquakes; fires; hurricanes; tornados; storms;
droughts; floods; arrests; restraint of government and people;
explosions; breakage, nuclear accidents or other malfunction or
accident to facilities, machinery, transmission pipes or canals;
partial or entire failure of a utility serving the Project;
shortages of labor, materials, supplies or transportation; or
(ii) any cause, circumstance or event not reasonably within
the control of the Company.
The exercise of remedies hereunder shall be subject to any applicable
limitations of federal bankruptcy law affecting or precluding that declaration
or exercise during the pendency of or immediately following any bankruptcy,
liquidation or reorganization proceedings.
Section 7.2. Remedies on Default. Whenever an Event of Default shall
have happened and be subsisting, either or both of the following remedial steps
may be taken:
(a) The Authority or the Trustee may have access to, inspect,
examine and make copies of the books, records, accounts and
financial data of the Company, only, however, insofar as they
pertain to the Project; or
(b) The Authority or the Trustee may pursue all remedies now
or hereafter existing at law or in equity to recover all amounts,
including all Loan Payments and Additional Payments, then due and
thereafter to become due under this Agreement, or to enforce the
performance and observance of any other obligation or agreement
of the Company under those instruments.
Notwithstanding the foregoing, the Authority shall not be obligated to take any
step which in its opinion will or might cause it to expend time or money or
otherwise incur liability unless and until a satisfactory indemnity bond has
been furnished to the Authority at no cost or expense to the Authority. Any
amounts collected as Loan Payments or applicable to Loan Payments and any other
amounts which would be applicable to payment of Bond Service Charges collected
pursuant to action taken under this Section shall be paid into the Bond Fund and
applied in accordance with the provisions of the Indenture or, if the
outstanding Bonds have been paid and discharged in accordance with the
provisions of the Indenture, shall be paid as provided in Section 5.08 of the
Indenture for transfers of remaining amounts in the Bond Fund.
The provisions of this Section are subject to the further limitation
that the rescission and annulment by the Trustee of its declaration that all of
the Bonds are immediately due and payable also shall constitute a rescission and
annulment of the consequences of that declaration and of the Event of Default
with respect to which that declaration has been made, provided that no such
rescission and annulment shall extend to or affect any subsequent or other
default or impair any right consequent thereon.
Section 7.3. No Remedy Exclusive. No remedy conferred upon or reserved
to the Authority or the Trustee by this Agreement is intended to be exclusive of
any other available remedy or remedies, but each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this
Agreement, or now or hereafter existing at law, in equity or by statute. No
delay or omission to exercise any right or power accruing upon any default shall
impair that right or power or shall be construed to be a waiver thereof, but any
such right or power may be exercised from time to time and as often as may be
deemed expedient. In order to entitle the Authority or the Trustee to exercise
any remedy reserved to it in this Article, it shall not be necessary to give any
notice, other than any notice required by law or for which express provision is
made herein.
Section 7.4. Agreement to Pay Attorneys' Fees and Expenses. If an
Event of Default should occur and the Authority or the Trustee should incur
expenses, including attorneys' fees, in connection with the enforcement of this
Agreement or the collection of sums due hereunder, the Company shall be
required, to the extent permitted by law, to reimburse the Authority and the
Trustee, as applicable, for the expenses so incurred upon demand.
Section 7.5. No Waiver. No failure by the Authority or the Trustee to
insist upon the strict performance by the Company of any provision hereof shall
constitute a waiver of their right to strict performance and no express waiver
shall be deemed to apply to any other existing or subsequent right to remedy the
failure by the Company to observe or comply with any provision hereof.
Section 7.6. Notice of Default. The Company shall notify the Trustee
immediately if it becomes aware of the occurrence of any Event of Default
hereunder or of any fact, condition or event which, with the giving of notice or
passage of time or both, would become an Event of Default.
(End of Article VII)
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Term of Agreement. This Agreement shall be and remain
in
full force and effect from the date of delivery of the Bonds to the Original
Purchaser until such time as all of the Bonds shall have been fully paid (or
provision made for such payment) pursuant to the Indenture and all other sums
payable by the Company under this Agreement shall have been paid.
Section 8.2. Amounts Remaining in Funds. Any amounts in the Bond
Fund
remaining unclaimed by the Holders of Bonds for four years after the due date
thereof (whether at stated maturity, by redemption, upon acceleration or
otherwise), at the option of the Company, shall be deemed to belong to and shall
be paid, subject to Section 5.07 of the Indenture, at the written request of the
Company, to the Company by the Trustee. With respect to the principal of and
any premium and interest on the Bonds to be paid from moneys paid to the Company
pursuant to the preceding sentence, the Holders of the Bonds entitled to those
moneys shall look solely to the Company for the payment of those moneys.
Further, any amounts remaining in the Bond Fund and any other special funds or
accounts created under this Agreement or the Indenture, except the Rebate Fund,
after all of the Bonds shall be deemed to have been paid and discharged under
the provisions of the Indenture and all other amounts required to be paid under
this Agreement and the Indenture have been paid, shall be paid to the Company to
the extent that those moneys are in excess of the amounts necessary to effect
the payment and discharge of the Outstanding Bonds.
Section 8.3. Notices. All notices, certificates, requests or other
communications hereunder shall be in writing, except as provided in Section 3.4
hereof, and shall be deemed to be sufficiently given when mailed by registered
or certified mail, postage prepaid, and addressed to the appropriate Notice
Address. A duplicate copy of each notice, certificate, request or other
communication given hereunder to the Authority, the Company or the Trustee shall
also be given to the others. The Company, the Authority and the Trustee, by
notice given hereunder, may designate any further or different addresses to
which subsequent notices, certificates, requests or other communications shall
be sent.
The Bond Insurer shall receive copies of all notices required to be
given by the Trustee, the Authority or the Company under this Agreement,
including all notices to Holders. All notices required to be given to the Bond
Insurer under this Agreement shall be in writing and shall be sent by registered
or certified mail addressed to municipal Bond Investors Assurance Corporation,
113 King Street, Armonk, New York 10504, Attention: Surveillance.
Section 8.4. Extent of Covenants of the Authority; No Personal
Liability. All covenants, obligations and agreements of the Authority contained
in this Agreement or the Indenture shall be effective to the extent authorized
and permitted by applicable law. No such covenant, obligation or agreement
shall be deemed to be a covenant, obligation or agreement of any present or
future member, officer, agent or employee of the Authority in other than his
official capacity, and neither the members of the Authority nor any official
executing the Bonds shall be liable personally on the Bonds or be subject to any
personal liability or accountability by reason of the issuance thereof or by
reason of the covenants, obligations or agreements of the Authority contained in
this Agreement or in the Indenture.
Section 8.5. Binding Effect. This Agreement shall inure to the benefit
of the Authority, the Company, the Trustee, the Paying Agent, the Registrar and
their respective permitted successors and assigns and shall be binding in
accordance with its terms upon the Authority, the Company and their respective
permitted successors and assigns provided that this Agreement may not be
assigned by the Company (except as permitted under Sections 5.8 or 5.13 hereof)
and may not be assigned by the Authority except to (i) the Trustee pursuant to
the Indenture or as otherwise may be necessary to enforce or secure payment of
Bond Service Charges or (ii) any successor public body to the Authority.
Section 8.6. Amendments and Supplements. Except as otherwise expressly
provided in this Agreement or the Indenture, subsequent to the issuance of the
Bonds and prior to all conditions provided for in the Indenture for release of
the Indenture having been met, this Agreement may not be effectively amended,
changed, modified, altered or terminated by the parties hereto except with the
consents and notices required by, and in accordance with, the provisions of
Article XI of the Indenture, as applicable.
Section 8.7. Execution Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be regarded as an original and
all of which shall constitute but one and the same instrument.
Section 8.8. Severability. If any provision of this Agreement, or any
covenant, obligation or agreement contained herein is determined by a judicial
or administrative authority to be invalid or unenforceable, that determination
shall not affect any other provision, covenant, obligation or agreement, each of
which shall be construed and enforced as if the invalid or unenforceable portion
were not contained herein. That invalidity or unenforceability shall not affect
any valid and enforceable application thereof, and each such provision,
covenant, obligation or agreement shall be deemed to be effective, operative,
made, entered into or taken in the manner and to the full extent permitted by
law.
Section 8.9. Governing Law. This Agreement shall be deemed to be a
contract made under the laws of the State and for all purposes shall be governed
by and construed in accordance with the laws of the State.
(End of Article VIII)
IN WITNESS WHEREOF, the Authority and the Company have caused this
Agreement to be duly executed in their respective names, all as of the date
hereinbefore written.
OHIO WATER DEVELOPMENT AUTHORITY
By: /S/ Steve Grossman
----------------------------------
Executive Director
Attest: /S/ M. Donita Hoosier
-----------------------------
Secretary-Treasurer
THE CINCINNATI GAS & ELECTRIC COMPANY
By: /S/ William L. Sheafer
----------------------------------
Title: Treasurer
Attest: /S/ D. R. Blum
-----------------------------
Secretary
EXHIBIT A
PROJECT FACILITIES COMPRISING
THE KILLEN PROJECT UNIT
General:
The Killen Electric Generating Station ("Killen") is located in Adams
County, Ohio, and its ownership is shared by the Company and The Dayton Power
and Light Company as tenants in common. The Company's undivided interest in the
portion of Killen comprising the Killen Project Unit is 33%. Killen is operated
by The Dayton Power and Light Company, which is responsible for managing the
acquisition, construction and installation of the Killen Project Unit.
Scope:
Circulating Water System
The circulating water system at Killen is a closed cycle system
utilizing one mechanical draft cooling tower. The round mechanical draft
cooling tower is approximately sixty-six feet high with a base diameter of
approximately two hundred twenty-seven feet.
Engineering, material, labor and supervision were provided for the
installation of the following components for the circulating water system:
Cooling tower including materials and hardware such as casing,
structural framework, fill, air inlet louvers, drift eliminators,
ferrous hardware and non-ferrous hardware
Water distribution system including riser pipes, distribution
piping, valving, fittings, tower deicing, etc.
Electrical supply to: fan motors, lighting, pump motors and any
other electrical work associated with the cooling tower
Access stairs, ladders, platforms and walkways
Lightning protection and grounding
Water circulation system including intake and discharge piping,
valves, circulating water pumps and motor
Substructure consisting of piling, footer and any other
construction technology necessary to support the cooling tower
Wastewater Treatment System
The wastewater treatment system at Killen represents a maximum
facility
required for the treatment of various plant wastewaters.
The treatment philosophy recommended for the various waste streams
generated at Killen was and is based on waste flows, characteristics and final
effluent limitations.
Sanitary wastes are treated in an extended aeration package unit which
provides secondary treatment. Effluent from this treatment facility is
subjected to disinfection by chlorination and discharged to the collection
basin. The sludge produced is hauled periodically for disposal in an approved
manner. Demineralizer and condensate polisher regenerate wastes, laboratory and
seal trough drains, coal pile area (active and dead storage) and precipitator
area runoff, bottom ash and fly ash sluicing pipe drainage and bottom ash system
overflow and seal water are all nonconcurrent and vary in flow rates. These
waste streams are all directed to the collection basin for equalization,
self-neutralization, retention and removal of particulates or solids by
sedimentation.
Boiler blowdown does not exceed the limitations set forth for iron and
copper and has been and will be directed to the collection basin. However,
facilities will be provided to divert this flow to the cleaning waste retention
basin, if it is found that the blowdown contains iron and copper at levels
higher than the effluent limitation. The waste is then treated in a treatment
facility either alone or combined with other cleaning wastes which are directed
to the cleaning waste retention basin. The effluent from the treatment system
is sent to the collection basin.
Boiler cleaning, reheater, superheater and air preheater cleaning wastes
which are occasional and may contain iron and copper in excess of effluent
limitations are directed to the cleaning waste retention basin and treated to
remove iron and copper. The effluent is directed to the collection basin. Any
sludge that is produced in the treatment facility is disposed of in an approved
manner.
Equipment drain, floor drain and other miscellaneous low volume
equipment cleaning wastes contaminated with oil are treated in an oil-water
separator system for separation of oil and the effluent sent to the collection
basin. The separated oil is collected in a waste oil storage tank for reuse or
disposal in an approved manner.
Storm water wastes from transformer and oil storage tanks area are
collected locally in a system of drains and directed to local oil-storm water
separator systems. The separated oil is collected in waste oil storage tanks
for reuse or disposal in an approved manner. The effluent water is directed to
the collection basin.
All waste streams directed to the collection basin are retained in the
basin for a minimum of 24 hours to permit sedimentation to occur. The overflow
or supernatant from the collection basin is directed to the bottom ash pond.
Cooling tower cleaning wastes, cooling tower blowdown and bottom ash
transport water are all directed to the bottom ash pond. Bottom ash pond water
is used for bottom ash and fly ash sluicing. Overflow from the bottom ash pond
is sent to the fly ash pond.
The fly ash pond, in addition to receiving the overflow from the bottom
ash pond, also receives the fly ash transport water. The final discharge from
the fly ash pond is to the river. An automatic liquid Carbon Dioxide
Recarbonation System neutralizes the high pH effluent to acceptable limits.
Ash Handling and Disposal
The ash handling system at Killen consists of a dry vacuum collection
system and a wet sluicing removal system designed to remove ash from the
electrostatic precipitator and bottom ash hoppers and to transport the collected
ash to on-site storage ponds.
Engineering, material, labor and supervision were provided for the
installation of the following components for the ash handling and disposal
system:
Hoppers, valves, controls, pumps, manifold pipe connection
system, vacuum producing equipment, discharge conveying
pipes to the wet ash disposal area
On-site ash disposal ponds
Supporting structural steel, pipe hangers and foundations
Necessary stairways, galleries and enclosures
Electrical work associated with the ash disposal system
EXHIBIT B
PROJECT FACILITIES COMPRISING
THE WALTER C. BECKJORD PROJECT UNIT
General:
The Walter C. Beckjord Electric Generating Station ("Beckjord Station")
is located in Clermont County, Ohio, and ownership of Unit 6 of the Beckjord
Station is shared by the Company, The Dayton Power and Light Company and the
Columbus & Southern Ohio Electric Company as tenants in common. The Company's
undivided interest in the portions of the Beckjord Station comprising the
Beckjord Project Unit is 37.5%. The Company operates the Beckjord Station and
is responsible for managing the acquisition, construction and installation of
the Beckjord Project Unit.
Scope:
The Beckjord Project Unit involved improvements in connection with the
then existing ash settling pond and construction of a new ash settling pond for
the disposal of fly ash and bottom ash (as defined below) produced at the
Beckjord Station.
The fly ash that is collected in the precipitators for generating units
5 and 6, together with the bottom ash collected in the hoppers below such
generating units, is transported to the then existing ash settling pond ("Ash
Settling Pond") by means of a sluicing system. This sluicing system consists of
a series of pipes through which water is pumped to convey ash from the
precipitators and ash hoppers to the Ash Settling Pond, where the fly and bottom
ash settles to the bottom of the pond. Ash-free water flows from the top of the
Ash Settling Pond into the adjacent river. Periodically, the settled ash is
dredged out of the Ash Settling Pond and is disposed of off-site in a landfill.
The then existing Ash Settling Pond described above is located
immediately adjacent to the river bank. Improvements were necessary to shore up
the bank of the river to prevent the release of ash materials from the pond into
the river. These improvements were accomplished in four phases and involved the
installation of "rip-rap" along 2,200 feet of the river bank. "Rip-rap" is a
layer of materials consisting of a plastic fabric cloth placed on top of a six
inch layer of sand. A layer of small No. 2 stone is placed on the plastic
fabric and a twelve to eighteen inch layer of exposed stone of at least 10
inches in diameter covers the smaller stone.
Because the then existing Ash Settling Pond for units 5 and 6 was filled
with fly and bottom ash, a new Ash Settling Pond ("New Ash Settling Pond") was
constructed in order to accommodate further on-site disposal of ash. The New Ash
Settling Pond consists of a dike, constructed from clay on an 80 acre site, that
is 40 feet tall, 15 feet wide at the top, and 175 feet wide at its base. A
vertical overflow pipe is located at the end of the Pond through which clarified
water flows to the adjacent river.
EXHIBIT C
PROJECT FACILITIES COMPRISING
THE MIAMI FORT PROJECT UNIT
General
The Miami Fort Electric Generating Station ("Miami Fort Station") is
located in Hamilton County, Ohio, and ownership of Units 7 and 8 of the Station
is shared by the Company and The Dayton Power and Light Company as tenants in
common. The Company's undivided interest in the portions of the Miami Fort
Station comprising the Miami Fort Project Unit is 64%. The Miami Fort Station
is operated by the Company, which is responsible for managing the acquisition,
construction and installation of the Miami Fort Project Unit.
Scope:
The Miami Fort Project Unit involved the acquisition of land for and the
construction of a Dry Fly Ash Disposal Basin ("Basin") and the construction of a
new Ash Settling Pond "B". The Pond and Basin are used for the disposal of fine
particulate residues ("fly ash") and heavy particulate residues ("bottom ash")
produced by the coal-fired boilers used to drive turbo generators at the Miami
Fort Electric Generating Station. The fly ash, which is captured in
electrostatic precipitators, and the bottom ash, which collects at the bottom of
the boilers in hoppers, are first transported by sluicing systems to ash
settling ponds. The Basin provides for the final disposal of fly and bottom ash
that is excavated from existing ash settling ponds and removed from fly ash
silos located adjacent to generating units 7 and 8.
Because the then existing Ash Settling Pond (Ash Basin "A") was filled
with ash, it became necessary to construct a new Ash Settling Pond "B" in order
to accommodate the deposit of additional ash. This addition involved raising
the elevation of the dike walls, which was accomplished in four stages. Upon
completion, the dike walls were raised to an elevation of 510 feet. Final site
work included the completion of the grading of the site, consulting services,
seeding the dike, construction of a floating walkway, and installation of an
erosion slab.
The Basin was constructed in a 30-40 foot deep gravel pit located on an
80 acre site. The gravel pit is lined with two feet of clay to prevent the fly
ash from seeping into underground water. Three monitoring wells were drilled
and monitoring equipment was installed to test ground water in selected areas
around the Basin for evidence of leaching of ash deposited in the Basin.
Rainwater is pumped from the surface of the Basin into a new clarifying pond
which was constructed to allow settling of any fly ash before discharge into the
adjacent river.