Exhibit 10(b)

 

 

 

PURCHASE AND SALE AGREEMENT

by and between

CENTRAL MISSISSIPPI GENERATING COMPANY, LLC

and

ENTERGY MISSISSIPPI, INC.,

Dated as of March 16, 2005

 

 

 

EXHIBITS AND SCHEDULES

  

Item

Description

Exhibit A-1, A-2

Form of Assignment and Assumption Agreement

Exhibit B

Form of Bill of Sale

Exhibit C

Form of Deed

Exhibit D

Form of Letter of Credit

Exhibit E

Form of Termination of Pre-Closing Interconnection Letter

Schedule 1.1A

Certain Permitted Encumbrances

Schedule 1.1B

Purchaser's Required Consents

Schedule 1.1C

Purchaser's Required Regulatory Approvals

Schedule 1.1D

Preliminary Title Commitment

Schedule 2.1(a)

Owned Real Property

Schedule 2.1(b)

Leased Real Property

Schedule 2.1(c)

Tangible Personal Property

Schedule 2.1(d)

Purchased Inventory

Schedule 2.1(e)

Purchased Project Contracts

Schedule 2.1(f)

Permits

Schedule 2.1(g)

Books and Records

Schedule 2.1(h)

Warranties

Schedule 2.1(i)

Claims and Causes of Action

Schedule 2.1(j)

Prepaid Items

Schedule 2.2(b)

Specified Excluded Assets

Schedule 2.2(g)

 Advance Payments

Schedule 4.4

Compliance With Laws

Schedule 4.7

Litigation

Schedule 4.8

Project Contracts and Other Contracts

Schedule 4.9

Purchased Project Contract Matters

Schedule 4.11

Owned Real Property

Schedule 4.12

Leased Real and Personal Property

Schedule 4.13

Condition of Purchased Assets; Defects

Schedule 4.16

Environmental Matters

Schedule 4.23(b)

Undisclosed Liabilities

Schedule 4.24

Adverse Material Change to Purchased Assets

Schedule 4.25

Seller's Required Consents and Seller's Required Regulatory Approvals

Schedule 4.26

Certain Changes Since Seller's Acquisition of Project

Schedule 5.5

Purchaser Litigation

Schedule 6.4

Exceptions to Conduct Pending Closing

Schedule 6.12

Designated NAES Employees

Schedule 8.7

Certain Title Insurance Exceptions

 

PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT, dated as of March 16, 2005, is made and
entered into by and between Central Mississippi Generating Company, LLC, a
limited liability company organized and existing under the laws of the State of
Delaware ("Seller"), and Entergy Mississippi, Inc., a corporation organized and
existing under the laws of the State of Mississippi ("Purchaser").

RECITALS

        A.     Seller owns the Project (as defined in Article 1).

        B.     Seller desires to sell, transfer and assign to Purchaser, and
Purchaser desires to purchase from Seller, all of Seller's right, title and
interest in and to the Purchased Assets on the terms and subject to the
conditions hereinafter set forth.

        C.     Seller and Purchaser are entering into this Agreement to evidence
their respective duties, obligations and responsibilities in respect of the
purchase and sale and related transactions contemplated by this Agreement and
the Ancillary Agreements as defined in Article 1 (the "Transactions").

NOW, THEREFORE, in consideration of the foregoing recitals and the agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, do hereby agree as follows:

ARTICLE 1

DEFINITIONS

Section 1.1    Certain Defined Terms. The following terms when used in this
Agreement (or in the Schedules and Exhibits to this Agreement) with initial
letters capitalized have the meanings set forth below:

"Adjustment Sections"

has the meaning set forth in Section 3.3.

"Affiliate"

means, with respect to any specified Person, any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise.

"Agreement"

means this Purchase and Sale Agreement, together with the Schedules and Exhibits
hereto.

"Ancillary Agreements"

means (i) the Bill of Sale, (ii) the Deed, (iii) the Assignment and Assumption
Agreements, (iv) any additional agreements and instruments of sale, transfer,
conveyance, assignment and assumption that may be executed and delivered by any
Party at the Closing, (v) the Letter of Credit and (vi) the Transmission
Purchase Agreements.

"Asserted Purchaser Claims

" has the meaning set forth in Section 3.8(a).

"Assignment and Assumption Agreements"

means the Assignment and Assumption Agreements, substantially in the form of
Exhibits A-1 and A-2, to be executed and delivered by Seller and Purchaser at
the Closing.

"Assumed Liabilities"

has the meaning set forth in Section 2.3.

"Bankrupt"

means, with respect to any entity, such entity (i) files a petition or otherwise
commences, authorizes or acquiesces in the commencement of a proceeding or cause
of action under any bankruptcy, insolvency, reorganization or similar law, or
has any such petition filed or commenced against it, (ii) makes an assignment or
any general arrangement for the benefit of creditors, (iii) otherwise becomes
bankrupt or insolvent (however evidenced), (iv) has a liquidator, administrator,
receiver, trustee, conservator or similar official appointed with respect to it
or any substantial portion of its property or assets, or (v) is generally unable
to pay its debts as they fall due.

"Bill of Sale"

means a Bill of Sale, substantially in the form of Exhibit B, to be executed and
delivered by Seller at the Closing.

"Business"

means the business of operating the Project and generating, selling and
delivering electric energy and providing Other Associated Electric Products from
the Project.

"Business Day"

means any day on which Federal Reserve member banks in New York, New York are
open for business; and a Business Day shall commence at 8:00 a.m. and close at
5:00 p.m., local time, at the location of the applicable Party's principal place
of business, or at such other location as the context may require.

"Closing"

has the meaning set forth in Section 3.1.

"Closing Date"

has the meaning set forth in Section 3.1.

"Closing Inventory Report

" means an Inventory Report dated as of the Closing Date.

"COBRA"

means the Consolidated Omnibus Budget Reconciliation Act of 1986.

"Code"

means the Internal Revenue Code of 1986.

"Commercially Reasonable Efforts"

means efforts which are reasonably within or should have been reasonably within
the contemplation of the Parties on the Effective Date and which do not require
the performing Party to expend funds or incur obligations other than
expenditures and obligations which are customary and reasonable in transactions
of the kind and nature contemplated by this Agreement. With respect to
expenditures required to satisfy Seller's obligations to use Commercially
Reasonable Efforts under this Agreement:

        (a)     For Seller's obligations to use Commercially Reasonable Efforts
other than those described in paragraphs (b) and (c) below, Seller shall be
required to expend up to, but shall not be required to expend more than,
$500,000 in aggregate payments to third parties to satisfy any and all such
obligations.

        (b)     For Seller's obligations to use Commercially Reasonable Efforts
for those actions described in Section 2.5(a)(ii), Seller shall be required to
expend up to, but shall not be required to expend more than, $500,000 in
aggregate payments to third parties to satisfy any and all such obligations
(such payments being in addition to those payments described in paragraph (a)
above).

        (c)     Seller shall not be required to expend any funds in order to
obtain any consent to transfer to Purchaser any of the Other Software Licenses.

        (d)     The limitations in paragraphs (a)-(c) above shall not apply to
Seller's obligations to use Commercially Reasonable Efforts other than with
respect to payments to third parties, shall not apply to payments to counsel for
Seller, shall not apply to expenditures resulting from the application of
provisions other than those expressly requiring Commercially Reasonable Efforts,
such as the provisions allocating costs and expenses in Section 6.2, and shall
not apply to any obligations to use Commercially Reasonable Efforts under
Sections 6.8 or 6.16.

"Confidentiality Agreement"

means that certain Confidentiality Agreement, dated as of June 1, 2004, between
ESI and Seller.

"Consumables"

means any and all of the following items of Inventory intended to be consumed or
needing regular periodic replacement at the Project in the ordinary course of
the conduct of the Business: lubricants, chemicals, fluids, lubricating oils,
filters, seals, gaskets, and other similar expendable materials; maintenance,
shop and office supplies; and all other expendable materials, supplies and other
items consumed at the Project in the ordinary course of the conduct of the
Business.

"Contract"

means any contract, agreement, arrangement, license, easement, lease,
commitment, sale and purchase order, and other instrument or understanding of
any kind, whether written or oral, express or implied.

"Damaged Portion"

has the meaning set forth in Section 6.8(b).

"Deed"

means one or more Deeds, substantially in the form of Exhibit C, conveying each
of the Owned Real Properties included in the Purchased Assets, free and clear of
all Encumbrances other than Permitted Encumbrances, with legal descriptions
suitable for conveyance of such Owned Real Properties of record, to be executed
and delivered by Seller at the Closing.

"Designated NAES Employees"

shall have the meaning set forth in Section 6.12(b).

"Dispute"

shall have the meaning set forth in Section 11.8(a).

"Easements"

means all easements, rights-of-way, privileges, franchises, licenses and other
similar agreements existing for the benefit of Real Property, including those
specified in Schedule 2.1(a).

"Effective Date"

means the date on which this Agreement has been executed and delivered by Seller
and Purchaser.

"Electric Interconnection Facilities"

means all structures, facilities, equipment, auxiliary equipment, devices and
apparatus directly or indirectly required or installed to interconnect and
deliver electric energy from the Project to the applicable delivery points and
including, electric transmission and/or distribution lines, transformation,
switching, electric metering equipment, any other metering equipment,
communications equipment, and safety equipment, including, but not limited to,
equipment required to protect (i) the electrical system to which the Project is
connected and its customers from faults occurring at the Project and (ii) the
Project from faults occurring on the electrical system to which the Project is
connected or on other electrical systems to which such electrical system is
directly or indirectly connected.

"Emission Allowances"

means all authorizations to emit specified units of Hazardous Substances from
the Project or the Project Site, which units are established by a Governmental
Authority with jurisdiction over the Project or the Project Site under
Environmental Law, including without limitation under (i) an air pollution
control and emission reduction program designed to mitigate global warming or
interstate or intrastate transport of air pollutants, (ii) a program designed to
mitigate impairment of surface waters, watersheds or groundwater, or (iii) any
pollution reduction program with a similar purpose, in each case regardless of
whether the Governmental Authority establishing such authorizations designates
such authorizations by a name other than "allowances."

"Encumbrances"

means any and all mortgages, pledges, claims, liens, security interests,
options, warrants, purchase rights, conditional and installment sales
agreements, easements, activity and use restrictions and limitations,
exceptions, rights-of-way, deed restrictions, defects or imperfections of title,
encumbrances and charges of any kind.

"Entergy Operating Companies"

means Entergy Arkansas, Inc., Entergy Louisiana, Inc., Entergy Mississippi,
Inc., Entergy Gulf States, Inc., and Entergy New Orleans, Inc.

"Entergy System"

means the transmission system of the Entergy Operating Companies, or of any
entity succeeding to the ownership or control thereof, with a substation located
near the Project.

"Environment"

means the environment, including without limitation, any of the following media
and any living organism or systems supported by any such media: (a) land,
including surface land, sub-surface strata, sea bed and riverbed under water (as
defined in clause (b) hereof) and any natural or man-made structures; (b) water,
including coastal and inland waters, navigable waters, surface waters, ground
waters, drinking water supplies and waters in drains and sewers, surface and
sub-surface strata; and (c) air, including indoor and outdoor air and air within
buildings and other man-made or natural structure above or below ground.

"Environmental Assessment"

means an environmental site assessment with respect to the Project and the
Project Site, prepared by the Environmental Consultant and performed in
compliance with standard ASTM E1527-00 or any such other measures as required by
EPA regulation to meet the "all appropriate inquiry" standard of CERCLA
Section 101 in form and substance satisfactory to Purchaser, in Purchaser's sole
discretion. A copy of the initial Environmental Assessment, dated September 22,
2004, prepared by the Environmental Consultant, has been supplied to Seller. If,
in its discretion, Purchaser elects to conduct a final Environmental Assessment,
the same shall be completed by Purchaser at its sole cost and expense not later
than sixty (60) days in advance of the Closing Date.

"Environmental Claim"

means, without limitation, any pending or threatened written notice, claim,
demand or other communication by any Person alleging or asserting a Party's or
any other Person's actual or potential liability for investigation, response,
investigation costs, cleanup costs, compliance costs, enforcement costs,
response costs, suits (whether in law or in equity), defense costs, capital
expenditures (whether incurred to construct, alter, replace or modify any of the
Purchased Assets as necessary for a Party to perform its obligations under this
Agreement or otherwise) or the funding necessary therefor, actual damages,
consequential damages, punitive damages, claims for contribution or indemnity,
damages to natural resources or other property, personal injuries (including
those arising from or related to toxic torts), fines or penalties, based on or
resulting from, in whole or in part: (a) the presence or Release of any
Hazardous Substances at any location, whether or not on property owned by such
Person; (b) circumstances forming the basis of any violation or alleged
violation of or legal obligation or liability pursuant to any Environmental Law;
or (c) claims for Remediation or costs associated with Remediation.

"Environmental Condition" means the presence or Release of a Hazardous Substance
in the Environment with the respect to the Project or the Project Site (wherever
migrating) for which there is an obligation under Environmental Law to engage in
any monitoring, investigation, assessment, treatment, cleanup, containment,
removal, mitigation, reporting, response or restorative work, or concerning
which a Governmental Authority with jurisdiction over such matter has required
or may require the foregoing activities under Environment Laws.

"Environmental Consultant"

means Malcolm Pirnie, Inc., or such other recognized environmental consulting
firm as shall be acceptable to Purchaser and retained by Purchaser at its cost.

"Environmental Law"

means any federal, state and local statutes, regulations, rules, ordinances,
codes, decrees, judgments and judicial or administrative orders or common law
relating to pollution or protection of the Environment or natural resources,
including, without limitation, laws relating to Releases of Hazardous Substances
or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, transport, disposal or handling of Hazardous Substances,
including, without limitation: the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Section 9601 et seq.; the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq.; the Federal Water
Pollution Control Act, 33 U.S.C. Section 1251 et seq.; the Clean Air Act, 42
U.S.C. Section 7401 et seq.; the Hazardous Materials Transportation Act, 49
U.S.C. Section 1471 et seq.; the Toxic Substances Control Act, 15 U.S.C.
Sections 2601 through 2629; the Oil Pollution Act, 33 U.S.C. Section 2701 et
seq.; the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. Section
11001 et seq.; the Safe Drinking Water Act, 42 U.S.C. Sections 300f through
300j; the Surface Mining Control and Reclamation Act of 1977, 30 U.S.C. Section
1201 et seq.; any similar laws of the State of Mississippi or of any other
Governmental Authority having jurisdiction over the Project or the Project Site.

"Environmental Liability"

means any Environmental Losses which (i) arise under or relate to any
Environmental Condition or Environmental Claim, or (ii) are attributable to
actions occurring or conditions existing on or prior to the Closing Date in
violation of any Environmental Laws.

"Environmental Loss"

means, without limitation, all liabilities, losses, claims, debts, assessments,
deficiencies, charges, demands, fines, penalties, costs, expenses, damages,
natural resource damages, reasonable fees and disbursements of counsel, costs of
Remediation, liens or other claims against property or improvements thereon for
work, labor or services performed with respect thereto or other obligations of
any kind, character or description (whether absolute, contingent, matured,
liquidated, unliquidated, accrued, known, unknown, direct, indirect, derivative
or otherwise) and expressly including those related to an indemnified Party's
own negligence, pertaining or relating directly or indirectly, in whole or in
part, to an Environmental Claim or Environmental Condition.

"Environmental Permit"

means any federal, state or local Permit under or in connection with any
Environmental Law, and includes without limitation any and all orders, consent
orders or binding agreements issued or entered into by a Governmental Authority
under any applicable Environmental Law relating to the Project or the Project
Site.

"Environmental Report"

means any environmental audit, environmental risk assessment, environmental site
assessment or other investigation of Environmental Conditions at or related to
the Project or the Project Site.

"ERISA"

means the Employee Retirement Income Security Act of 1974.

"ESI"

means Entergy Services, Inc., a Delaware corporation.

"ESI as Agent"

means ESI as Agent for one or more of the Entergy Operating Companies, pursuant
to that certain Amended and Restated Entergy System Agency Agreement, dated as
of May 1, 2003, by and among said Entergy Services, Inc. and the Entergy
Operating Companies.

"Estimated Closing Adjustment"

has the meaning set forth in Section 3.5.

"Estimated Closing Statement"

has the meaning set forth in Section 3.5.

"Estimated Cost"

shall have the meaning set forth in Sections 6.8(b)(i) and 6.16(a)(i).

"Estimated Limit Date"

shall have the meaning set forth in Sections 6.8(c) and 6.16(d).

"EWG"

has the meaning set forth in Section 4.20.

"Excluded Assets"

has the meaning set forth in Section 2.2.

"Excluded Liabilities"

has the meaning set forth in Section 2.4.

"Expiration Date"

means the date of the three year anniversary of this Agreement, as such date may
be extended pursuant to Sections 6.8 or 6.16.

"FERC"

means the Federal Energy Regulatory Commission as established by the Department
of Energy Organization Act of 1977, 42 U.S.C. Section 7171, or its regulatory
successor, as applicable.

"Final Allocation"

has the meaning set forth in Section 3.7.

"Final Closing Adjustment"

has the meaning set forth in Section 3.5.

"First Meeting Deadline"

shall have the meaning set forth in Sections 11.8(b).

"Fuel"

means natural gas or fuel oil of sufficient quality to meet all technical
specifications of the Project.

"GAAP"

means United States generally accepted accounting principles as in effect from
time to time, applied on a consistent basis.

"Gas Interconnection Facilities"

means all structures, pipelines, facilities, equipment, auxiliary equipment,
devices and apparatus directly or indirectly required or installed to
interconnect and deliver natural gas from the applicable delivery points for
natural gas from the TETCO pipeline to the Project's electric generation units.

"GEII"

means General Electric International Inc., a Delaware corporation.

"Good Utility Practices"

means those practices, methods and acts engaged in or approved by a significant
portion of the electric utility and power generation industry during the
relevant time period, or any of the practices, methods and acts which, in the
exercise of reasonable judgment by a prudent electric utility in light of the
facts known at the time a decision is made, could have been expected to
accomplish a desired result at reasonable cost consistent with good business
practices, reliability, safety and expedition and in compliance with Law. Good
Utility Practices are not intended to be limited to the optimum practices,
methods or acts to the exclusion of others, but rather to those practices,
methods and acts generally accepted or approved by a significant portion of the
electric utility industry in the relevant region, during the relevant time
period, as described in the immediately preceding sentence.

"Governmental Authority"

means any federal, state, local, foreign or other governmental subdivision,
regulatory or administrative agency, commission, body, court or tribunal or
other authority exercising or entitled to exercise any administrative,
executive, judicial, legislative, police, regulatory or Tax authority or power
over the matters specified or if such matters are not specified over Seller,
Purchaser, the Project, the Project Site, the Transactions or any related
matter.

"Hazardous Substances"

means (a) any chemicals, materials, substances or wastes which are defined or
regulated as "hazardous substances," "hazardous materials," "hazardous
constituents," "restricted hazardous materials," "extremely hazardous
substances," "hazardous wastes," "extremely hazardous wastes" "restricted
hazardous wastes," "toxic substances," "toxic pollutants," "toxic air
pollutants," "pollutants," "contaminants" or words of similar meaning and
regulatory effect, including without limitation as the foregoing may be defined
under any Environmental Law and (b) any other chemicals, materials, wastes or
substances, the exposure to or treatment, storage, transportation, use, disposal
or Release of which is prohibited, limited or regulated by any Environmental
Law.

"HSR Act"

means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

"Income Tax"

means any Tax imposed by any Governmental Authority (i) based upon, measured by
or calculated with respect to gross or net income, profits or receipts
(including municipal gross receipt Taxes, capital gains Taxes and minimum Taxes)
or (ii) based upon, measured by or calculated with respect to multiple bases
(including corporate franchise Taxes) if one or more of such bases is described
in clause (i), in each case together with any interest, penalties or additions
attributable to such Tax.

"Indemnitee"

has the meaning set forth in Section 7.3.

"Indemnitor"

has the meaning set forth in Section 7.3.

"Independent Accounting Firm"

means such nationally recognized, independent accounting firm as is mutually
appointed by Seller and Purchaser for purposes of this Agreement.

"Independent Contractor"

means any Person (with the exception of attorneys and accountants) working at,
or providing services or consulting in any capacity or manner for or related to
the Project, and who is considered under applicable law or by Seller as an
independent contractor, agent or consultant, including NAES, R.W. Beck and
Kelson Attala.

"Initial Purchase Price"

has the meaning set forth in Section 3.2.

"Intellectual Property Rights"

has the meaning set forth in Section 4.14.

"Intercompany Arrangements"

has the meaning set forth in Section 2.2(m).

"Interconnection Agreement" means an Interconnection Agreement in form
satisfactory to Purchaser to be executed and delivered by Transmission Purchaser
and Purchaser and become effective upon the Closing.

"Interconnection and Service Charge Agreement" means an Interconnection and
Service Charge Agreement in form satisfactory to Purchaser to be executed and
delivered by Transmission Purchaser and Purchaser and become effective upon the
Closing.

"Interconnection Facilities Maintenance Agreement" means an Interconnection
Facilities Maintenance Agreement in form satisfactory to Purchaser to be
executed and delivered by Transmission Purchaser and Purchaser and become
effective upon the Closing.

"Interconnection Facilities"

means all Electric Interconnection Facilities and Gas Interconnection
Facilities.

"Interim LTSA"

means Seller's arrangements with GEII to provide customary maintenance of the
combustion and steam turbines of the Project in compliance with GEII's technical
requirements and information.

"Inventory"

means any and all of the inventory items and equipment intended to be used or
consumed at the Project in the ordinary course of the conduct of the Business
including Consumables, new, repaired or refurbished equipment, components,
assemblies, sub-assemblies and spare, replacement or other parts; tools, special
tools, equipment; and all associated materials, supplies, software and other
goods and other similar items of moveable property.

"Inventory Accounting Policies"

has the meaning set forth in Section 3.3(b).

"Inventory Report"

shall mean an inventory report prepared by Seller in the form set forth in
Schedule 2.1(d).

"Inventory Threshold"

has the meaning set forth in Section 3.3(b).

"Inventory Value"

has the meaning set forth in Section 3.3(b).

"Kelson Attala"

means Kelson Attala, LLC.

"Knowledge"

or similar terms used in this Agreement with respect to a Party means:

        (a) in the case of Seller, the extent of the knowledge, as of the
Effective Date (or, with respect to (i) the certificate delivered pursuant to
Section 8.6, as of the date of delivery of the certificate and (ii) the matters
set forth in Sections 6.3(a) and 11.14(c), as of the date that such knowledge is
acquired), of David Patton after his due inquiry with Edward Burrell, Tom
Corlett, Michael Chapman and Eric Emerson and, with respect to the matters in
Sections 4.4, 4.5, 4.7 and 4.18, after his due inquiry with appropriate
representatives of Greenberg Traurig, LLP, Kelson Attala and NAES; and

        (b) in the case of Purchaser, the extent of the knowledge, as of the
Effective Date (or, with respect to (i) the certificate delivered pursuant to
Section 9.6, as of the date of delivery of the certificate and (ii) the matters
set forth in Sections 6.3(c) and 11.14(c), as of the date that such knowledge is
acquired), of the following individuals whether or not employed by Purchaser:
William Mohl, Marie Heard, Gary Dickens, Robert Malone, Cory Burton, Phil
Carter, Trey Helle, Chuck Barlow, Carol St. Clair and Warren Page.

For purposes of this definition, an individual shall be deemed to have
"knowledge" of a particular fact, circumstance or other matter if such
individual is or at any time was actually aware of such fact, circumstance or
other matter.

"Laws"

means all statutes, rules, regulations, ordinances, orders and codes of any and
all Governmental Authorities.

"Leased Real Property"

has the meaning set forth in Section 2.1(b).

"Letter of Credit

" has the meaning set forth in Section 3.8(a).

"Letter of Intent

" means that certain Letter of Intent, dated as of August 12, 2004, by and
between Seller and ESI.

"Liquidated Damages for Costs and Expenses"

means a cash payment in the amount of (i) $2,000,000, if the event giving rise
to the termination notice occurs prior to October 15, 2005, (ii) $3,500,000, if
the event giving rise to termination notice occurs on or after October 15, 2005,
but prior to October 15, 2006, and (iii) $4,500,000, if the event giving rise to
termination notice occurs on or after October 15, 2006; provided, however, that
the amount of Liquidated Damages for Costs and Expenses payable in respect of an
event giving rise to Purchaser's right to terminate this Agreement shall be
determined by reference to the earliest date on which a termination notice could
have occurred based on such event, regardless of any waiver or delay in the
giving of such notice; provided, further, however, that to the extent Purchaser
shall at any time have the right to terminate this Agreement and receive
Liquidated Damages for Costs and Expenses pursuant to more than one of the
provisions of Section 10.1, and different amounts of Liquidated Damages for
Costs and Expenses would be payable depending on which provision of Section 10.1
is made the basis of such Party's termination notice, only one of the amounts
shall be payable and such amount shall be the greatest of the amounts of
Liquidated Damages for Costs and Expenses.

"Limit Date"

shall have the meaning set forth in Sections 6.8(c) and 6.16(d).

"Losses"

has the meaning set forth in Section 7.1(a).

"Material Adverse Effect"

with respect to Seller, means any occurrence set forth in clause (a) or clause
(b) of this definition, and with respect to Purchaser, means any occurrence set
forth in clause (a) of this definition: (a) any event, circumstance or condition
materially impairing such Party's authority, right, or ability to perform its
obligations under this Agreement or any Ancillary Agreement or to consummate the
Transactions; or (b) any change (or changes taken together) in, or effect on,
the Project that is materially adverse to the operations or physical condition
of the Project, or the business, assets, properties, financial condition,
results of operations or prospects of the Business, including any change (or
changes taken together) or effect related to the Project that (i) causes or
could reasonably be expected to cause a diminution in value of any of the
Purchased Assets of $500,000 or more or (ii) causes, or could reasonably be
expected to cause, an increase in the amount or cost of paying, performing or
otherwise discharging any of the Assumed Liabilities of $500,000 or more;
provided that in no event shall the term Material Adverse Effect include: (1)
any changes in national or regional or electric industry economic conditions
generally affecting the national or regional electric industry as a whole, (2)
any changes in the price of natural gas generally prevailing in the SERC Region,
(3) any changes in the price of real estate generally prevailing in the SERC
Region, or (4) any changes in the price of electric generating facilities
generally prevailing in the SERC region.

"Material Software Licenses"

shall mean the Purchased Project Contracts set forth on Schedule 2.1(e) under
the caption "Software Licenses" that are described as items # 1, 2, 3, 7, 8, 13,
14, 16 and 17 and any Replacement License Agreements.

"Monthly Operating Report"

shall mean a Monthly Management Report for the applicable period substantially
in the form of those provided by Seller and delivered to Purchaser prior to the
Effective Date, including therein technical discussions of energy management,
financial results, operations and maintenance and regulatory compliance, with
attached reports covering such matters as have been covered in reports
previously provided by Seller or are otherwise reasonably requested by
Purchaser.

"NAES"

means North American Energy Services Company.

"NEG Contracts"

shall have the meaning set forth in Section 2.2(k).

"NEG Tolling Contract"

shall have the meaning set forth in Section 2.2(k).

"New LTSA"

has the meaning set forth in Section 8.8.

"Nonassignable Asset"

has the meaning set forth in Section 2.5(b).

"Notice of Claim"

has the meaning set forth in Section 7.3.

"Order"

means any order, injunction, judgment, decree, ruling, writ, assessment or
arbitration award of a Governmental Authority.

"Other Associated Electric Products"

means all of the services and products associated with capabilities or
operational attributes or regulatory treatment of a generating unit, including
but not limited to the capability to provide ancillary services, reserves,
operational functions (e.g., black start capability), receipt or allocation or
emissions allowances and other services and products.

"Other Software Licenses"

shall mean the Purchased Project Contracts set forth on Schedule 2.1(e) under
the caption "Software Licenses" other than the Material Software Licenses.

"Owned Real Property"

has the meaning set forth in Section 2.1(a).

"Participating Entergy Operating Company Transactions"

means any and all proposed purchases and sales of capacity, energy and/or Other
Associated Electric Products of or from the Project at any time or from time to
time after the Closing by any of the Participating Entergy Operating Companies.

"Participating Entergy Operating Company"

means Purchaser and any other Entergy Operating Company that becomes (or is
expected to become) a permitted assignee of or successor to Purchaser hereunder
on or before the Closing Date, or purchases (or is expected to purchase) any
portion of the output of the Project from and after the Closing and designated
by Purchaser as a "Participating Entergy Operating Company" in a written notice
to Seller after the Effective Date.

"Party"

means Seller or Purchaser, as the context requires; "Parties" means,
collectively, Seller and Purchaser.

"Permits"

means permits, registrations, licenses, franchises, certificates and other
consents, approvals and authorizations of Governmental Authorities to the extent
related to the Project or the Business.

"Permitted Encumbrances"

means (i) liens for Property Taxes and other governmental charges and
assessments which are not yet due and payable or the validity of which is being
contested in good faith by appropriate proceedings and described in Part I of
Schedule 1.1A, (ii) all exceptions, restrictions, easements, charges,
rights-of-way and monetary and nonmonetary Encumbrances which are set forth in
any Purchased Permit listed on a schedule to this Agreement or listed in Part II
of Schedule 1.1A, (iii) mechanics', materialmens', laborers', carriers',
workers', repairers' and other similar liens arising in the ordinary course of
business for sums not yet due and payable, so long as the amount of any such sum
in respect of which any such lien shall have arisen does not exceed $50,000,
individually, and all such sums do not exceed $250,000 in the aggregate, and
(iv) Encumbrances with respect to any of the Purchased Assets and created by or
resulting from the acts or omissions of Purchaser.

"Person"

means any individual, partnership, joint venture, corporation, limited liability
company, trust, association or unincorporated organization, any Governmental
Authority or any other entity.

"Predecessor-in-Interest"

means any predecessor-in-interest with respect to the Project, including Attala
Generating Company, LLC (formerly known as Duke Energy Attala, LLC), VCC Attala
OL LLC and TCC Attala OL LLC, and each of their respective Affiliates and
Independent Contractors.

"Preliminary Title Commitment"

means the Preliminary Title Commitment of the Title Insurer, Commitment Number
04-3706-11653MS, dated effective as of February 25, 2005, issued in the name of
Seller, and attached hereto as Schedule 1.1D.

"Prepaid Items"

has the meaning set forth in Section 2.1(j).

"Project"

means the natural gas fueled electrical generation plant consisting of two
General Electric 7241FA combustion turbine generator sets, two ALSTOM
triple-pressure level heat recovery steam generators fitted with selective
catalytic reduction, and a condensing General Electric steam turbine generator
located in Attala County, Mississippi, together with all related assets and
properties, real, personal and mixed, and interests therein (to the extent of
Seller's interest), including ancillary equipment, Interconnection Facilities
and Protective Apparatus and any additions thereto or replacements thereof.

"Project Contract"

means any Contract to which Seller is a party, by which Seller or any of the
Purchased Assets is bound or which has the primary purpose of supporting the
Project or the Business, including the Interim LTSA.

"Project Employee Plan"

has the meaning set forth in Section 2.2(d).

"Project Employees"

means any employees, including individuals deemed to be employees by Law, who
are employed in positions at or, if employed at another location, who perform
substantially all their work in support of, the Project (whether employed by
Seller, if any, or any Independent Contractor or any Predecessor-in-Interest).
References to "former Employees" or "future Employees" mean former or future
employees, including individuals deemed to be employees by Law, who, during the
period of their employment (whether employed by Seller, if any, or any
Independent Contractor or any Predecessor-in-Interest) related to the Project,
were or are employed in positions at or, if employed at another location, who
performed or perform substantially all their work in support of, the Project.

"Project Insurance Policies"

means all insurance policies carried by or for the benefit of Seller or with
respect to the ownership, operation or maintenance of the Project or the
Business, including all liability, property damage, self insurance arrangements,
retrospective assessments and business interruption policies in respect thereof.

"Project Site"

means (a) the Owned Real Property and the Leased Real Property, and (b) the
"Transmission Real Property" under and as such term is defined in the
Transmission Assets Purchase and Sale Agreement.

"Property Tax"

means any Tax resulting from and relating to the assessment of real or personal
property by any Governmental Authority.

"Protective Apparatus"

means such equipment and apparatus, including but not limited to protective
relays, circuit breakers and the like, necessary or appropriate to isolate the
Project from the electrical system to which they are connected consistent with
Good Utility Practices.

"Purchase Price"

has the meaning set forth in Section 3.3.

"Purchased Assets"

has the meaning set forth in Section 2.1.

"Purchased Inventory"

has the meaning set forth in Section 2.1(d).

"Purchased Permits"

has the meaning set forth in Section 2.1(f).

"Purchased Project Contracts"

has the meaning set forth in Section 2.1(e).

"Purchaser"

has the meaning set forth in the introductory paragraph of this Agreement.

"Purchaser Claims"

has the meaning set forth in Section 7.1(a).

"Purchaser Financial Statements"

has the meaning set forth in Section 5.6.

"Purchaser Group"

has the meaning set forth in Section 7.1(a).

"Purchaser's Additional Regulatory Approvals"

means from each of the Governmental Authorities having jurisdiction over
Purchaser's or any of the Participating Entergy Operating Companies' retail
operations, and specified in Part II of Schedule 1.1C, either: (i) approval of
the Purchaser Transactions and the Participating Entergy Operating Company
Transactions, including approval of the consummation thereof and of the full
recovery of all costs associated with the Purchaser Transactions and the
Participating Entergy Operating Company Transactions (through base rates, fuel
adjustment charges, and/or such other rates or charges as may be applied
pursuant to a rider or otherwise, provided that the provisions for full recovery
of all costs are acceptable to Purchaser and/or the Participating Entergy
Operating Companies, in their sole discretion) pursuant to a finding that the
consummation of the Purchaser Transactions by Purchaser, and the consummation of
the Participating Entergy Operating Transactions by Purchaser and the
Participating Entergy Operating Companies, is prudent and in the public
interest, or (ii) such other regulatory treatment as is deemed acceptable to
Purchaser and the Participating Entergy Operating Companies in the exercise of
their sole and absolute discretion.

"Purchaser's Required Consents"

means the notices to or the consents, waivers or releases of any Person other
than a Governmental Authority required by Purchaser to be made or obtained by or
on behalf of Purchaser or any Participating Entergy Operating Company prior to
consummation of the Purchaser Transactions, including the notices, consents,
waivers or releases specified in Schedule 1.1B.

"Purchaser's Required Regulatory Approvals"

means the notices to, filings with or approvals, statements, waivers, consents
or authorizations of or from any Governmental Authority of competent
jurisdiction over any of the Parties, any Participating Entergy Operating
Company, any other Affiliates of Purchaser or the Project that are required (a)
for Purchaser to consummate the Purchaser Transactions, including those
specified in Part I of Schedule 1.1C or (b) to be made or obtained by or on
behalf of Purchaser or any of the Participating Entergy Operating Companies with
respect to the Transactions, the Transmission Arrangement Agreements or the
transactions contemplated thereby, including those specified in Part I of
Schedule 1.1C.

"Purchaser Transactions"

means the Transactions regarding the Purchased Assets to which the Purchaser is
a Party.

"Real Estate Curative Documents"

has the meaning specified in Section 8.17(h).

"Real Property"

means the Owned Real Property and the Leased Real Property.

"Release"

shall have the meaning set forth in the Laws referred to in the definition of
Environmental Laws herein, but also shall include without limitation any
threatened Release, spill, leak, discharge, abandonment, disposal, pumping,
pouring, emitting, emptying, injecting, leaching, dumping, depositing,
dispersing, allowing to escape or migrate into or through the Environment or the
Project Site of any Hazardous Substance. The term "Released" shall have a
corresponding meaning.

"Remediation"

means any action of any kind to address an Environmental Condition, or the
Release or the presence of Hazardous Substances in the Environment at the
Project Site or any Purchased Assets, including the following: (i) monitoring,
investigation, assessment, treatment, cleanup, containment, remediation,
removal, mitigation, response or restoration work; (ii) obtaining any Permits
necessary to conduct any such work; (iii) preparing and implementing any plans
or studies for such work; (iv) obtaining a written notice from a Governmental
Authority with jurisdiction under applicable Environmental Laws that no material
additional work is required by such Governmental Authority; (v) any response to,
or preparation for, any inquiry, order, hearing or other proceeding by or before
any Governmental Authority with respect to any such Environmental Condition,
Release or presence of Hazardous Substances; and (vi) any other activities that
are appropriate or required under Environmental Laws to address an Environmental
Condition, or the presence of or Release of Hazardous Substances in the
Environment at the Project Site or any other Purchased Assets.

"Replacement License Agreement"

has the meaning specified in Section 2.5(a)(ii).

"R.W. Beck"

means R.W. Beck Plant Management, Ltd.

"Scheduled Adjustment Date"

has the meaning set forth in Section 3.6.

"Seller"

has the meaning set forth in the introductory paragraph of this Agreement.

"Seller Claims"

has the meaning set forth in Section 7.2(a).

"Seller Group"

means Seller, the Seller Trust, each of HSBC Bank USA, National Association, as
Trustee, Monumental Life Insurance Company, Transamerica Life Insurance and
Annuity Company, Transamerica Life Insurance Company, AIG Life Insurance
Company, American General Life & Accident Insurance Company, American General
Life Insurance Company, The United States Life Insurance Company in the City of
New York (Formerly American General Life Insurance Company of New York), The
Maritime Life Assurance Company, John Hancock Life Insurance Company, John
Hancock Variable Life Insurance Company, New York Life Insurance Company, SOF
Investments, L.P. and Chateau I, LP and each of their respective officers,
directors, attorneys, agents and successors and assigns.

"Seller Litigation"

has the meaning set forth in Section 4.7.

"Seller's Required Consents"

means the notices to or the consents, waivers or releases of any Person other
than a Governmental Authority that are required by Seller to be made or obtained
by or on behalf of Seller prior to the consummation of the Transactions,
including the consents, waivers or releases specified in Schedule 4.25.

"Seller's Required Regulatory Approvals"

means the notices to, filings with or approvals, waivers, consents or
authorizations of or from any Governmental Authority that are required (i) for
Seller to consummate the Transactions, including, those specified in Schedule
4.25 and (ii) by Seller to be made or obtained by or on behalf of Seller prior
to the Closing, including those specified in Schedule 4.25.

"Seller Trust"

means the Attala 2004 Trust, a New York trust, and owner of 100% of the
membership interests in Seller.

"SERC Region"

means the North American Electric Reliability Council region served by the
members of the Southeastern Electric Reliability Council.

"SO2 Emission Allowance"

means (i) an authorization by the USEPA under the Federal Clean Air Act, 42
U.S.C. Section 7401, et seq., to emit up to one ton of sulfur dioxide during or
after a specified calendar year, or (ii) an authorization by the Mississippi
Department of Environmental Quality authorizing the emission of up to one (1)
ton of sulfur dioxide during or after a specified calendar year under an
existing or future SO2 Emissions Allowance program.

"Tangible Personal Property"

has the meaning set forth in Section 2.1(c).

"Tax"

or "Taxes" means any federal, state, local or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental, customs duties, capital stock, franchise,
profits, withholding, social security (or similar), unemployment, disability,
real property (including assessments, fees or other charges based on the use or
ownership of real property), personal property, transactional, use, transfer,
registration, value added, alternative or add-on minimum, estimated or other tax
of any kind whatsoever, including any interest, penalty or addition thereto,
whether disputed or not, including, without limitation, any item for which
liability arises as a transferee or secondary liability in respect any tax
(whether imposed by law, contractual agreement or otherwise) and any liability
in respect of any tax as a result of being a member of any affiliated,
consolidated, combined, unitary or similar group.

"Tax Return"

means any return, report, information return, declaration, claim for refund or
other document, together with all amendments and supplements thereto (including
all related or supporting information), required to be supplied to any
Governmental Authority responsible for the administration of Laws governing
Taxes including information returns or reports with respect to backup
withholding and other payments to third parties.

"Termination Date"

has the meaning set forth in Section 10.1.

"Termination of Pre-Closing Interconnection Letter" means the Termination of
Pre-Closing Interconnection Letter, substantially in the form of Exhibit E, to
be executed and delivered by Seller prior to the Closing.

"Third Party Claim"

means a claim by a Person that is not a member of the Seller Group or the
Purchaser Group, including any claim for the costs of conducting Remediation, or
seeking an order or demanding that a Person undertake Remediation.

"Title Insurer"

has the meaning set forth in Section 8.7.

"Title Policy"

has the meaning set forth in Section 8.7.

"Tolling Agreement"

means that certain Tolling Agreement, dated as of July 1, 2004, by and between
Seller and ESI as Agent.

"Transactions"

has the meaning set forth in the Recitals.

"Transfer Tax"

means any sales Tax, transfer Tax, transaction Tax, conveyance fee, use Tax,
stamp Tax, stock transfer Tax or other similar Tax, including any related
penalties, interest and additions thereto.

"Transmission Arrangement Agreements" means the Interconnection Agreement, the
Interconnection and Service Charge Agreement, the Interconnection Facilities
Maintenance Agreement and any other documents and agreements between Purchaser
and Transmission Purchaser contemplated therein that are to become effective
upon Closing.

"Transmission Assets" means the "Transmission Assets" under, and as such term is
defined in, the Transmission Assets Purchase and Sale Agreement.

"Transmission Assets Purchase and Sale Agreement" means the Purchase and Sale
Agreement dated as of March 16, 2005, between Seller and Transmission Assets
Purchaser.

"Transmission Assets Purchaser" means Attala Transmission LLC, a Louisiana
limited liability company.

"Transmission Purchase Agreements" means the Transmission Assets Purchase and
Sale Agreement and the Termination of Pre-Closing Interconnection Letter.

"USEPA Allowance Tracking System"

means the electronic recordkeeping and notification system called "Allowance
Tracking System," "ATS," "NOx Allowance Tracking System" or "NATS" which is
maintained by the USEPA in order to record, track and monitor transactions in
SO2 Emission Allowances and NOx Emission Allowances, the status of SO2 Emission
Allowance and NOx Emission Allowance accounts and related matters.

"USEPA"

means the United States Environmental Protection Agency.

"Warranties"

has the meaning set forth in Section 2.1(h).

Section 1.2    Certain Interpretive Matters. In this Agreement, unless the
context otherwise requires:

 a. the singular number includes the plural number and vice versa;

    reference to any Person includes such Person's successors and assigns but,
    if applicable, only if such successors and assigns are permitted by this
    Agreement, and reference to a Person in a particular capacity excludes such
    Person in any other capacity;

    reference to any gender includes each other gender;

    reference to any agreement (including this Agreement), document or
    instrument means such agreement, document or instrument as amended or
    modified and in effect from time to time in accordance with the terms
    thereof and, if applicable, the terms hereof;

    reference to any Article, Section, Schedule or Exhibit means such Article,
    Section, Schedule or Exhibit of or to this Agreement, and references in any
    Article, Section, Schedule, Exhibit or definition to any clause means such
    clause of such Article, Section, Schedule, Exhibit or definition unless
    otherwise specified;

    any accounting term used and not otherwise defined in this Agreement or any
    Ancillary Agreement has the meaning assigned to such term in accordance with
    GAAP;

    "hereunder," "hereof," "hereto" and words of similar import are references
    to this Agreement as a whole and not to any particular Section or other
    provision hereof or thereof;

    "including" (and with correlative meaning "include") means including without
    limiting the generality of any description preceding such term;

    relative to the determination of any period of time, "from" means "from and
    including," "to" means "to but excluding" and "through" means "through and
    including;"

    reference to any Law (including statutes and ordinances) means such Law as
    amended, modified codified or reenacted, in whole or in part, and in effect
    from time to time, including rules and regulations promulgated thereunder;

    any agreement, instrument, insurance policy, statute, regulation, rule or
    order defined or referred to herein or in any agreement or instrument that
    is referred to herein means such agreement, instrument, insurance policy,
    statute, regulation, rule or order as from time to time amended, modified or
    supplemented, including (in the case of agreements or instruments) by waiver
    or consent and (in the case of statutes, regulations, rules or orders) by
    succession of comparable successor statutes, regulations, rules or orders
    and references to all attachments thereto and instruments incorporated
    therein; and

    all calculations and computations pursuant to this Agreement shall be
    carried and rounded to the nearest two (2) decimal places.

 

ARTICLE 2

PURCHASE AND SALE

Section 2.1    1Purchased Assets. Upon the terms and subject to the conditions
contained in this Agreement, at the Closing, Seller shall sell, convey, assign,
transfer and deliver to Purchaser, and Purchaser will purchase and acquire from
Seller, (i) all of the assets, properties and rights of every kind, nature,
character and description, whether real, personal or mixed, whether tangible or
intangible, whether accrued, contingent or otherwise relating to, used or held
for use in the Business or for or at the Project, directly or indirectly, in
whole or in part, in existence on the date hereof and any additions thereto on
or before the Closing Date, whether or not carried on the books and records of
Seller, in each case to the extent now or hereafter located at the Project or
owned by Seller on or before the Closing Date, and (ii) without limiting the
foregoing, the assets relating to, used or held for use in the Business or for
or at the Project described below, but excluding with respect to clauses (i) and
(ii) above all Excluded Assets (collectively, the "Purchased Assets"):

 a. All real property owned by Seller, including fee interests, Easements, water
    rights, mineral rights and other owned interests in real property, and,
    without limiting the foregoing, the parcels of real property, Easements,
    water rights and other real property rights described in Schedule 2.1(a),
    and in each case all appurtenances thereto and all buildings, fixtures,
    component parts, other constructions and other improvements thereon and
    thereto, including to the extent applicable any construction work in
    progress (collectively, the "Owned Real Property");

    All real property leased by Seller and all related lease or sublease
    agreements, and, without limiting the foregoing, the real property leasehold
    estates and related lease or sublease agreements described in
    Schedule 2.1(b), and in each case all appurtenances thereto and all
    buildings, fixtures and other improvements thereon and thereto, including to
    the extent applicable any construction work in progress (collectively, the
    "Leased Real Property");

    All machinery, equipment, vehicles, tools, furniture, furnishings and other
    tangible movable property owned by Seller or located at the Project,
    excluding Inventory, and, without limiting the foregoing, the property
    listed or described in Schedule 2.1(c) (collectively, the "Tangible Personal
    Property");

    All Inventory owned by Seller or located at the Project and, without
    limiting the foregoing, the property listed or described in Schedule 2.1(d)
    (collectively, the "Purchased Inventory");

    All Project Contracts listed or described in Schedule 2.1(e) (collectively,
    the "Purchased Project Contracts");

    All Permits and, without limiting the foregoing, the Permits listed or
    described in Schedule 2.1(f) and Schedule 4.16 (collectively, the "Purchased
    Permits");

    All books, records, documents, drawings, reports, operating data, operating
    safety and maintenance manuals, inspection reports, engineering design
    plans, blueprints, specifications and procedures and similar items related
    to the Project or the Business in Seller's care custody and control and,
    without limiting the foregoing, the items listed or described in
    Schedule 2.1(g) (provided that Seller may make and keep additional copies of
    any of the foregoing, subject to the Confidentiality Agreement);

    All warranties and guarantees from manufacturers, contractors, suppliers and
    other third parties of any Owned Real Property, Leased Real Property,
    Tangible Personal Property or Purchased Inventory to the extent that the
    same are owned by Seller and not expired pursuant to their terms and,
    without limiting the foregoing, the warranties and guarantees listed or
    described in Schedule 2.1(h) (collectively, the "Warranties"), and in each
    case all claims or causes of action against any third parties thereunder
    other than those for reimbursement for repairs or replacements completed and
    paid for prior to Closing;

    All claims or causes of action against any third parties listed or described
    in Schedule 2.1(i);

    All advance payments, prepayments, prepaid expenses, deposits or the like to
    the extent related to the Project or the Business and owned by Seller and,
    without limiting the foregoing, such items listed or described in
    Schedule 2.1(j) (collectively the "Prepaid Items");

    All SO2 Emission Allowances remaining in the Project USEPA Allowance Trading
    System individual boiler accounts; and

    Except for Excluded Assets, all other assets, properties and rights of every
    kind, nature, character and description, whether real, personal or mixed,
    whether tangible or intangible, whether accrued, contingent or otherwise
    relating to, used or held for use in the Business or for or at the Project,
    directly or indirectly, in whole or in part, in existence on the date hereof
    and any additions thereto on or before the Closing Date, whether or not
    carried on the books and records of Seller, in each case to the extent now
    or hereafter located at the Project or owned by Seller.

Section 2.2    Excluded Assets. In accordance with the last clause of the first
paragraph of Section 2.1, nothing in this Agreement will constitute or be
construed as conferring on Purchaser, and Purchaser shall not be entitled or
required to purchase or acquire, any right, title or interest in, to or under
the following assets, interests, properties, rights, licenses or contracts (the
"Excluded Assets"):

 a. Any mobile equipment and tools owned by Independent Contractors and other
    third parties (other than any Person in the Seller Group) and located at the
    Project and related inventory items for the operation and maintenance of
    such mobile equipment and tools owned by Independent Contractors and other
    third parties (other than any Person in the Seller Group) and located at the
    Project, and any Tangible Personal Property, Purchased Inventory or Prepaid
    Items to the extent consumed or disposed of prior to the Closing, in each
    case in the ordinary course of the conduct of the Business consistent with
    past practice and the provisions of this Agreement, including the provisions
    of Section 6.4;

    Any of the assets, properties, rights or interests, owned, used, occupied or
    held by or for the benefit of Seller that are listed or described in
    Schedule 2.2(b) or that Purchaser, in a writing or writings delivered to
    Seller at least 10 days prior to the Closing Date, identifies as not desired
    by Purchaser to be included within, or to constitute a part of, the
    Purchased Assets;

    All of the rights and interests, and all of the liabilities and obligations,
    of Seller in, to, under or pursuant to any Project Contract other than the
    Purchased Project Contracts or that Purchaser, in a writing or writings
    delivered to Seller at least 10 days prior to the Closing Date, identifies
    as not desired by Purchaser to be included within, or to constitute a part
    of, the Purchased Assets;

    To the extent applicable to any current, former or future Project Employees
    or their employers, or to the Project or the Business, any of the following,
    and any funds and property held in trust or any other funding vehicle
    pursuant to, (i) any "employee benefit plan" (within the meaning of Section
    3(3) of ERISA) (ii) any other severance pay, stay pay, salary continuation,
    bonus, incentive, stock option or other equity-based, retirement or early
    retirement, pension, profit sharing, deferred compensation, welfare,
    vacation/holiday plans, contracts, programs, funds or similar arrangements,
    and (iii) all other employee fringe or other benefit plans, contracts,
    programs, funds or similar arrangements, whether written or oral, qualified
    or nonqualified, funded or unfunded, foreign or domestic adopted,
    maintained, sponsored, contributed to or made available for the benefit of
    such Project Employees and/or with respect to which Seller, any Independent
    Contractor or any Predecessor-in-Interest has any ongoing obligation or
    actual or potential ongoing liability whatsoever (all of the above being
    hereinafter referred to individually as a "Project Employee Plan" and
    collectively as the "Project Employee Plans"), and in particular, but
    without limitation, neither Purchaser nor any of its Affiliates shall be
    deemed to have assumed any Project Employee Plan by reason of any provision
    of this Agreement;

    Except to the extent described as Purchased Assets in Schedule 2.1(g), books
    and records of Seller, including Seller's minute books, limited liability
    company interest books, limited liability company interest ledger and
    company seal;

    Cash, cash equivalents, bank deposits, and accounts and notes receivable,
    trade or otherwise, including any amounts due under the Tolling Agreement
    and any posted collateral;

    The advance payments, accruals, prepayments, prepaid expenses, deposits or
    the like listed in Schedule 2.2(g);

    Rights of Seller arising under this Agreement, the Ancillary Agreements or
    any other instrument or document executed and delivered pursuant to the
    terms of this Agreement;

    The right to receive mail and other communications relating to any of the
    Excluded Assets or Excluded Liabilities, all of which mail and other
    communications shall be promptly forwarded by Purchaser to Seller to the
    extent received by Purchaser;

    All refunds or credits, if any, of taxes due to or from Seller (but nothing
    herein shall limit the effect of the prorations and allocations of Tax
    liabilities elsewhere in this Agreement);

    That certain Tolling Agreement (the "NEG Tolling Contract") dated as of May
    7, 2002 between Attala Generating Company, LLC ("AGC") and Attala Energy
    Company, LLC ("AEC"), that certain Guarantee dated as of May 7, 2002 by PG&E
    National Energy Group, Inc. (currently known as National Energy Gas &
    Transmission, Inc. "NEG"), in favor of AGC, guaranteeing the payment
    obligations of AEC under the NEG Tolling Contract, that certain Facility
    Lease Agreement dated as of May 7, 2002 between VCC ATTALA OL LLC, as Owner
    Lessor, and Attala Generating Company, LLC, as Facility Lessee and that
    certain Facility Lease Agreement dated as of May 7, 2002 between TCC ATTALA
    OL LLC, as Owner Lessor, and Attala Generating Company, LLC, as Facility
    Lessee (the "NEG Contracts");

    All claims or causes of action against any third parties including claims
    under warranties and guarantees, indemnification claims, contribution claims
    or claims for refunds, prepayments, offsets, recoupment, judgments and the
    like to the extent related to the Project or the Business and owned by
    Seller other than the claims or causes of action listed or described in
    Sections 2.1(h) and 2.1(i);

    Any contract, agreement, arrangement or commitment of any nature in respect
    of any intercompany transaction between Seller, on the one hand, and any of
    the Seller Group, on the other hand, whether or not such transaction relates
    to any contribution to capital, loan, the provision of goods or services,
    tax sharing arrangements, payment arrangements, intercompany advances,
    charges or balances, or the like (collectively, the "Intercompany
    Arrangements"); and

    The Transmission Assets.

    

No designation by Purchaser of any asset as an Excluded Asset pursuant to
subsections (b) or (c) of this Section 2.2 shall serve to reduce the Purchase
Price. At any time or from time to time, up to thirty (30) days following the
Closing, any and all of the tangible Excluded Assets may be removed from the
Project by Seller (at no expense to Purchaser, but without charge by Purchaser
for temporary storage), provided that Seller shall do so in a manner that does
not unduly or unnecessarily disrupt normal business activities at the Project.

Section 2.3    Assumption of Liabilities. Upon the Closing, Purchaser will
assume, and will thereafter pay, perform and discharge as and when due, and
Purchaser shall indemnify Seller Group in accordance with Section 7.2(a)(vi)
with respect to, the following, and only the following, obligations and
liabilities of Seller to the extent, and only to the extent, such obligations
and liabilities are allocable to the period after the Closing Date or are
prorated to Purchaser under Section 3.4 (collectively, the "Assumed
Liabilities"): all liabilities and obligations under the Purchased Project
Contracts assigned to Purchaser under this Agreement (other than obligations or
liabilities prorated to Seller under Section 3.4), except in each case to the
extent such liabilities and obligations are allocable to the period before the
Closing Date, including liabilities and obligations thereof, that but for a
breach or default by Seller or a waiver or extension given to or by Seller,
would have been paid, performed or otherwise discharged on or prior to the
Closing Date or to the extent the same arise out of any such breach or default
by, or waiver or extension given to or by Seller.

Section 2.4    Excluded Liabilities. Except for Assumed Liabilities as provided
in Section 2.3, Purchaser shall not assume or be obligated to pay, perform or
otherwise discharge or be responsible or liable with respect to, and Seller
shall indemnify Purchaser Group in accordance with Section 7.1(a)(iv) with
respect to, any liabilities or obligations of Seller or otherwise relating to
the Business or the Project or any present or former owner or operator thereof,
whether or not of, associated with, or arising from, any of the Purchased
Assets, and whether fixed, contingent or otherwise, known or unknown
(collectively, the "Excluded Liabilities"), including the following:

 a. Any liabilities or obligations relating to, based in whole or in part on
    events or conditions occurring or existing in connection with, or arising
    out of, the Business as operated on or prior to the Closing Date, or the
    design, construction, ownership, possession, use, or operation of any of the
    Project, including the Purchased Assets, on or before the Closing Date, or
    sale or other disposition on or prior to the Closing Date of any capacity of
    or energy from the Project or any of the Purchased Assets (or any other
    assets, properties, rights or interests associated, at any time on or prior
    to the Closing Date, with the Business);

    Any liabilities or obligations of Seller to the extent relating to any
    Excluded Assets or other assets which are not Purchased Assets and the
    ownership, operation and conduct of any business in connection therewith or
    therefrom, including any amounts due from Seller under or arising from any
    Project Contracts other than the Purchased Project Contracts or from any
    Intercompany Arrangements;

    Any liabilities or obligations of Seller in respect of costs determined to
    be the responsibility of Seller under Section 3.4, any Taxes for which
    Seller is liable under Section 6.6 and Taxes attributable to the ownership,
    operation or use of any of the Project, including the Purchased Assets on or
    before the Closing Date (except for Taxes for which Purchaser is liable
    pursuant to Section 3.4 or Section 6.6 hereof);

    Any liabilities or obligations arising on or prior to the Closing Date from
    the breach by Seller of, default by Seller under or waiver or extension
    given by or to Seller with respect to the performance of any term, covenant
    or provision of any of the Purchased Project Contracts, that would have
    been, but for such breach, default, waiver or extension, paid, performed or
    otherwise discharged on or prior to the Closing Date or to the extent the
    same arise out of any such breach, default, waiver or extension;

    Any liabilities or obligations, including fines, penalties or costs imposed
    by a Governmental Authority and the costs of any associated defense or
    response with respect to any of the Project, including the Purchased Assets
    resulting from an investigation, proceeding, request for information or
    inspection before or by a Governmental Authority whether pending or
    commencing on, prior to or after the Closing Date, to the extent based on
    events or conditions occurring or existing in connection with, or arising
    out of, or otherwise relating to, the Business or the ownership, possession,
    use, operation, sale or other disposition on or prior to the Closing Date of
    any of the Project, including the Purchased Assets (or any other assets,
    properties, rights or interests associated, at any time on or prior to the
    Closing Date, with the Business), or actions taken or omissions to act made
    on or prior to the Closing Date.

    Any liabilities or obligations of any of Seller Group or their respective
    directors, officers, members, shareholders or agents, arising out of, or
    relating to, this Agreement, any of the Ancillary Agreements or any of the
    transactions contemplated hereby or thereby, whether incurred prior to, on
    or after the Closing Date, including, without limitation, any and all
    finder's or broker's fees and expenses, and any and all fees and expenses of
    any attorneys, accountants or other professionals;

    Any liabilities or obligations relating to any current, former or future
    Project Employee or other Person (whether employed by Seller, if any, or any
    Independent Contractor or any Predecessor-in-Interest) or to any spouse,
    children, other dependents or beneficiaries of any such Person or any
    successor-in-interest to any such Person, with respect to incidents, events,
    exposures or circumstances occurring at any time before or after Closing, in
    each case whenever any claims arising therefrom or relating thereto mature
    or are asserted, including all such liabilities and obligations arising (i)
    under or related to any Project Employee Plan, (ii) under or arising from
    any claim by any such Project Employees for compensation, severance
    benefits, any other benefit claims under any Project Employee Plans or
    applicable Laws, vacation pay, continuation coverage, expenses or any
    similar type claims arising from employment prior to the Closing or as a
    result of the consummation of the Transactions, (iii) under any employment,
    wage and hour restriction, equal employment opportunity, affirmative action,
    discrimination, retaliation, tort, plant closing or immigration and
    naturalization Laws or any Law relating to employee benefits, employment
    discrimination, leave, accommodation, severance, labor relations, hiring or
    retention, safety, any employment contracts or agreements, wages and hours
    of employees or any other terms or conditions of employment or any other
    employment-related matter or workplace issue, including COBRA, (iv) under
    any collective bargaining agreement, collective bargaining or labor
    relations Law, or agreement or arrangement with a labor organization or
    employee representative, (v) under any agreement concerning or relating to
    such Project Employees or other Persons performing work or services for the
    direct or indirect benefit of the Project, or (vi) in connection with any
    workers' compensation or any other employee health, accident, disability or
    safety claims; but excluding, however, all such liabilities and obligations
    arising from the actions of Purchaser Group with respect to Project
    Employees contacted by Purchaser Group for hiring before Closing or arising
    after Closing with respect to Project Employees hired by Purchaser;

    Any liabilities or obligations relating to the Business or the Project,
    including the Purchased Assets (or any other assets, properties, rights or
    interests associated, at any time on or prior to the Closing Date, with the
    Business or any of the Purchased Assets), to the extent based on events or
    conditions occurring or existing on or prior to the Closing Date and arising
    out of or relating to (i) any dispute arising out of or in connection with
    capacity of or energy provided or services rendered from the Project,
    including claims for refunds, personal injury or property damage, (ii)
    claims relating to employee health and safety, including claims for injury,
    sickness, disease or death of any Person, (iii) any lien described in clause
    (iii) of the definition of Permitted Encumbrances or any unpaid sums for
    which any such liens shall have arisen, (iv) claims by an Independent
    Contractor or other Person utilized or retained for services or work related
    to or in support of the Project, or (v) compliance with any Laws relating to
    any of the foregoing;

    Any liabilities or obligations to the extent based on, relating to or
    arising from events or conditions occurring or existing in connection with,
    or arising out of, any and all assets, properties, rights and interests
    which are not being acquired by Purchaser hereunder, including relating to
    or arising from the Excluded Assets;

    Any liabilities or obligations incurred by any of Seller Group or any of
    their respective directors, officers, shareholders, members, agents or
    Independent Contractors after the Closing Date (but this paragraph shall not
    limit the liabilities or obligations for which Purchaser provides
    indemnification under Section 7.2);

    Any liabilities or obligations under any of the Purchased Project Contracts
    which would be included in the Purchased Assets but for the provisions of
    Section 2.5, except to the extent Purchaser is provided with the benefits
    thereunder as contemplated by such Section; and

    Any liability representing indebtedness for money borrowed (and any
    refinancing thereof).

Section 2.5    Assignability and Consents.

 a. (i) Seller shall use Commercially Reasonable Efforts to take, or cause to be
    taken, all necessary actions to obtain, at the earliest practicable date and
    in any event prior to the Closing Date, all consents, approvals,
    authorizations or waivers of or from any third party necessary to authorize,
    approve or permit the full and complete sale, conveyance, assignment,
    transfer and delivery of the Purchased Assets, and to consummate and make
    effective the Transactions.

    

    (ii) Within thirty (30) days after the execution of the Agreement, Seller
    will provide notice to the counterparty to each of the Material Software
    Licenses of the pending assignment of such Material Software Licenses to
    Purchaser (or to any permitted assignee under the Agreement) upon the
    occurrence of the Closing. Seller shall use Commercially Reasonable Efforts
    to either (y) obtain any necessary consents to the assignment of such
    Material Software License and the rights to use such Material Software
    License to Purchaser (or to any permitted assignee under the Agreement;
    provided however that, a consent that doesn't include such permitted
    assignees shall be deemed acceptable to Purchaser) prior to the Closing Date
    or (z) enter into a new license agreement ( each a "Replacement License
    Agreement") in replacement of such Material Software License, with rights,
    terms and conditions that are substantially similar to such Material
    Software License and with terms that permit the transfer thereof to
    Purchaser (or to any permitted assignee under the Agreement; provided
    however that, a Replacement License Agreement that doesn't include such
    permitted assignees shall be deemed acceptable to Purchaser) without having
    to obtain the counterparty's consent, and transfer such Replacement License
    Agreement and the rights to use the license granted thereunder to Purchaser
    prior to the Closing Date. Each such Replacement License Agreement shall
    constitute a Purchased Project Contract hereunder.

    Notwithstanding anything contained in this Agreement to the contrary, but
    subject to paragraph (d), this Agreement shall not constitute an agreement
    to assign any Purchased Asset, and Seller shall not be obligated or entitled
    to assign such Purchased Asset, if the attempted assignment or assumption of
    the same, without Seller first having obtained the consent, approval,
    authorization or waiver of a third party, would constitute a breach or
    default under any Purchased Project Contract, would violate any Law or would
    in any way adversely affect the rights, or increase the obligations, of any
    Party to this Agreement with respect to such Purchased Asset (each a
    "Nonassignable Asset"); provided, however, that Seller shall use
    Commercially Reasonable Efforts to obtain all such consents, approvals,
    authorizations and waivers at the earliest practicable date and in any event
    prior to the Closing Date and, if Seller shall not have obtained any such
    consent, approval, authorization or waiver prior to the Closing, Seller
    shall continue to use Commercially Reasonable Efforts to obtain as promptly
    as practicable after the Closing any such consent, approval, authorization
    or waiver not obtained prior to the Closing. Purchaser shall cooperate as
    reasonably requested by Seller in connection with Seller's efforts to obtain
    any such consent, approval, authorization or waiver.

    Without limiting Seller's obligations under Section 2.5(b), if any such
    consent, approval, authorization or waiver shall not have been obtained
    prior to the Closing, to the extent and for so long as the related
    Nonassignable Asset shall not have been assigned and transferred to
    Purchaser, Seller shall, following the Closing, hold such Nonassignable
    Asset in trust for the use and benefit of Purchaser, and shall take such
    other actions (including entering into written agreements) as Purchaser may
    reasonably request in order to place Purchaser in the same position as if
    such consents, approvals, authorizations or waivers had been obtained, or to
    provide to Purchaser the benefit of, any Nonassignable Asset not assigned
    and transferred to Purchaser.

    Nothing herein shall be construed to require Purchaser to consummate the
    Transactions if any condition in Article 8 has not been obtained.

    

ARTICLE 3

CLOSING; PURCHASE PRICE

Section 3.1    Closing. Subject to the terms and conditions hereof the
consummation of the Transactions (the "Closing") will take place at the offices
of Bracewell & Patterson, L.L.P., at 10:00 a.m. local time, on a mutually
acceptable date within ten (10) Business Days following the date on which the
conditions set forth in Articles 8 and 9, other than those conditions that by
their nature are to be satisfied at the Closing, have been either satisfied or
waived by the Party for whose benefit such conditions exist, or at such other
time and place as the Parties may mutually agree. The date on which the Closing
occurs is referred to herein as the "Closing Date." The Closing shall be
effective for all purposes immediately after 11:59 p.m. on the Closing Date. At
the Closing, and subject to the terms and conditions hereof, the following will
occur:

 a. Deliveries by Seller. At the Closing, Seller shall execute and deliver, or
    cause to be executed and delivered, to Purchaser the following:

        instruments of transfer and conveyance, properly executed and
        acknowledged by Seller in such customary form as is reasonably
        acceptable to both Seller and Purchaser, that are necessary to transfer
        to and vest in Purchaser all of Seller's right, title and interest in
        and to the Purchased Assets or which may otherwise be required by the
        Title Insurer, including:
    
        the Bill of Sale;
        
        the Assignment and Assumption Agreements; and
        
        the Deed;
        
        
    
     i. any documents reasonably requested from Seller by the Title Insurer and
        allocable to Seller's obligations hereunder (including a gap indemnity
        agreement and other documents required by the Title Insurer pursuant to
        Schedule B-I of the Preliminary Title Commitment), in form and substance
        satisfactory to the Title Insurer, properly executed by Seller;
    
        a certificate and affidavit of non-foreign status of Seller pursuant to
        Section 1445 of the Code, properly executed by Seller;
    
        those documents required to be delivered to Purchaser by Seller pursuant
        to Article 8 or in accordance with the provisions of any Ancillary
        Agreement;
    
        all consents, waivers or approvals obtained by Seller with respect to
        the sale and purchase of the Purchased Assets, including those with
        respect to the transfer of any Purchased Project Contract or Permit or
        the consummation of the transactions contemplated by this Agreement or
        any of the Ancillary Agreements;
    
        evidence, in form and substance reasonably satisfactory to Purchaser,
        demonstrating that Seller has obtained Seller's Required Regulatory
        Approvals and Seller's Required Consents to the extent required by
        Section 8.4(c); and
    
        any other documents or instruments reasonably required by Purchaser to
        consummate the Transactions and reasonably requested of Seller prior to
        the Closing Date.
    
        

 b. Deliveries by Purchaser. At Closing, Purchaser shall deliver, or cause to be
    delivered, to Seller the following:

    the Initial Purchase Price as adjusted by the Final Closing Adjustment, by
    wire transfer of immediately available funds to an account or accounts
    designated by Seller in writing prior to the Closing Date;
    
    the Assignment and Assumption Agreements;
    
    those documents required to be delivered to Seller by Purchaser pursuant to
    Article 9 or in accordance with the provisions of any Ancillary Agreement;
    
    evidence, in form and substance reasonably satisfactory to Seller,
    demonstrating that Purchaser has obtained Purchaser's Required and
    Additional Regulatory Approvals and Purchaser's Required Consents to the
    extent required by Section 9.4(b);
    
    any documents reasonably requested from Purchaser by the Title Insurer and
    allocable to Purchaser's obligations hereunder, in form and substance
    satisfactory to the Title Insurer, properly executed by Purchaser; and
    
    any other documents or instruments reasonably required by Seller to
    consummate the Transactions and reasonably requested of Purchaser prior to
    the Closing Date.
    
    

 c. Ancillary Agreements. Subject to the occurrence of and contemporaneously
    with the Closing, each Party will execute and deliver, or cause to be
    executed and delivered, such of the Ancillary Agreements which such Party is
    required to execute and deliver, or cause to be executed and delivered, as
    applicable, at or upon the Closing and which such Party has not previously
    executed and delivered, or caused to be executed and delivered, as
    applicable.

Section 3.2    Initial Purchase Price. The initial purchase price for the
Purchased Assets being sold shall be (a) $85,312,248, if the Closing occurs
prior to October 15, 2005, (b) $88,094,169, if the Closing occurs on or after
October 15, 2005, but prior to October 15, 2006, and (c) $92,730,704, if the
Closing occurs on or after October 15, 2006 (such price on the Closing Date
being, the "Initial Purchase Price").

Section 3.3    Adjustments to Initial Purchase Price. The Initial Purchase Price
shall be subject to such adjustments as are specified in this Section 3.3 and as
may occur under the provisions of Section 3.5 (this Section and Section 3.5
being referred to as the "Adjustment Sections," and the Initial Purchase Price
as so adjusted is herein referred to as the "Purchase Price").

 a. Adjustments from Prorations. The Initial Purchase Price shall be adjusted to
    account for the items prorated as of the Closing Date pursuant to Section
    3.4.

    Inventory. The Parties agree that the Initial Purchase Price assumes a
    quantity of Purchased Inventory, in the aggregate, with a cost value of
    $3,658,846 (the "Inventory Threshold"). Accordingly, the Parties agree that
    the Initial Purchase Price shall be further adjusted by the difference
    between the Inventory Threshold and the cost value of the Purchased
    Inventory as of the Closing (the "Inventory Value"). The Inventory Value
    shall be determined in the same manner as the initial valuation of the
    Purchased Inventory for determining the Inventory Threshold (the "Inventory
    Accounting Policies") which in each case shall exclude from inventory any
    parts procured and obtained with the intent to be consumed in a scheduled
    major maintenance event (including, without limitation, combustion
    inspections and hot gas path inspections). The Initial Purchase Price shall
    be (i) increased by the amount by which the Inventory Value exceeds the
    Inventory Threshold, or (ii) decreased by the amount by which the Inventory
    Value is less than the Inventory Threshold. Notwithstanding the foregoing,
    there shall be no adjustment to the Initial Purchase Price pursuant to this
    Section 3.3(b) unless the difference between the Inventory Threshold and the
    Inventory Value exceeds One Hundred Thousand Dollars (U.S. $100,000).

Section 3.4    Prorations.

 a. Purchaser and Seller agree that, except as otherwise specifically provided
    in this Agreement, all of the ordinary and recurring items normally incurred
    by Seller (but excluding all Taxes other than Property Taxes) relating to
    the Business and operation of the Project, in each case as related to the
    Purchased Assets, shall be prorated and charged as of the Closing Date,
    without any duplication of payment under the Project Contracts, with Seller
    liable to the extent such items relate to any time periods (tax year periods
    for Property Tax) ending on or prior to the Closing Date, and Purchaser
    liable to the extent such items relate to periods (tax year periods for
    Property Tax) after the Closing (measured in the same units used to compute
    the item in question and otherwise measured by calendar days); provided that
    notwithstanding anything to the contrary herein, Purchaser shall not pay any
    amount under this Section 3.4 that constitutes an Excluded Liability.

    In connection with the prorations referred to in Section 3.4(a) above, in
    the event that actual figures are not available at the Closing Date, the
    proration shall be based upon the applicable amounts accrued through the
    Closing Date or paid for the most recent year or other appropriate period
    for which such amounts paid are available. All prorated amounts shall be
    recalculated and paid to the appropriate Party within thirty (30) days after
    the date that the previously unavailable actual figures become available.
    Seller and Purchaser shall furnish each other with such documents and other
    records as may be reasonably requested in order to confirm all proration
    calculations made pursuant to this Section 3.4.

Section 3.5    Procedures for Closing Adjustments. At least twenty (20) calendar
days prior to the anticipated Closing Date, Purchaser (with the assistance of
Seller, to the extent requested by Purchaser) shall prepare and deliver to
Seller an estimated closing statement (the "Estimated Closing Statement") that
shall set forth Purchaser's best estimate of all estimated adjustments to the
Initial Purchase Price required by this Agreement to be made as of the Closing
(the "Estimated Closing Adjustment"). The Estimated Closing Adjustment, insofar
as it relates to the adjustment required by Section 3.3(b), will be based on an
Inventory survey which shall be conducted by Seller, in consultation with
Purchaser, within thirty (30) days prior to the anticipated Closing Date
consistent with the Inventory Accounting Policies and the results of which shall
be delivered by Seller to Purchaser promptly upon completion. Seller shall
provide at least five (5) Business Days advance written notice to Purchaser of
the commencement of such Inventory survey and shall, to the extent Purchaser
reasonably requests, permit Purchaser to observe and monitor Seller's conduct of
the Inventory survey. Within ten (10) calendar days after the delivery of the
Estimated Closing Statement by Purchaser to Seller, Seller may object in good
faith to the Estimated Closing Adjustment in writing. If Seller objects to the
Estimated Closing Adjustment within such ten (10) calendar day period, the
Parties shall attempt to resolve their differences by negotiation and the
Closing will not take place until such differences have been resolved in
accordance with the provisions of Section 3.6. If Seller does not object to the
Estimated Closing Adjustment, the parties will negotiate the final amount of all
adjustments to the Initial Purchase Price (the "Final Closing Adjustment") at
least five (5) Business Days prior to the Closing Date, or, if the Parties
cannot resolve any differences with respect to such Final Closing Adjustment,
the Closing will not take place until such differences have been resolved in
accordance with the provisions of Section 3.6.

Section 3.6    Procedures for Certain Purchase Price Adjustments. If
circumstances exist that result in any disagreement in respect of an adjustment
to the Purchase Price pursuant to the provisions of the Adjustment Sections,
then and in any such event, such negotiations, and the resolution of
disagreements, shall be conducted in accordance with the provisions of this
Section 3.6. The Parties shall negotiate such adjustment of the Purchase Price
in good faith prior to the date such adjustment is otherwise scheduled to become
effective (each, a "Scheduled Adjustment Date"). If the Parties are unable to
agree upon an adjustment by the fifth (5th) Business Day prior to such date,
then for the items in dispute such Scheduled Adjustment Date and any Closing
Date (but not any Termination Date) shall be extended to the fifth (5th)
Business Day following completion of the procedure described in this Section 3.6
and the determination of the pertinent adjustment, to provide for the
opportunity to resolve such disagreement pursuant to the provisions of this
Section 3.6. Within seven (7) Business Days following the original Scheduled
Adjustment Date, each Party shall submit to the Independent Accounting Firm in
writing its proposed adjustments of the Purchase Price which were to occur on
such Scheduled Adjustment Date. Such proposals shall be materially in accordance
with the last proposals made by such Party to the other Party during the course
of the aforementioned good faith negotiations between the Parties. The Parties
shall additionally submit such memoranda, arguments, briefs and evidence in
support of their respective positions, and in accordance with such procedures,
as the Independent Accounting Firm may determine. Within five (5) Business Days
following the due date of such submissions, as to each adjustment of the
Purchase Price that was to occur on the Scheduled Adjustment Date concerning
which there exists disagreement, the Independent Accounting Firm shall select,
on an individual basis, a proposed adjustment of the Purchase Price proposed by
one of the Parties, it being agreed that the Independent Accounting Firm shall
have no authority to alter any such proposal in any way. Such determination by
the Independent Accounting Firm shall be final and binding between the Parties
as to such adjustments of the Purchase Price and shall not be subject to further
challenge by the Parties pursuant to Section 11.8 or otherwise. Upon the
determination of the appropriate adjustments, the Parties shall, subject to the
terms and conditions of this Agreement, effectuate such adjustments by including
them in the payments to occur at the Closing. Subject to the foregoing, the
Independent Accounting Firm may determine the issues in dispute following such
procedures, consistent with the provisions of this Agreement, as it deems
appropriate to the circumstances and with reference to the amounts in issue. The
Parties do not intend to impose any particular procedures upon the Independent
Accounting Firm, it being the desire of the Parties that any such disagreement
shall be resolved as expeditiously and inexpensively as reasonably practicable.
The Independent Accounting Firm shall have no liability to the Parties in
connection with services, except for acts of bad faith, willful misconduct or
gross negligence and the Parties shall provide such indemnities to the
Independent Accounting Firm as it may reasonably request consistent with the
foregoing. The fees and disbursements of the Independent Accounting Firm shall
be paid one-half by Seller and one-half by Purchaser.

Section 3.7    Allocation of Purchase Price. The Parties shall use reasonable
efforts to jointly prepare and agree upon an allocation of the Purchase Price
among the Purchased Assets in accordance with Section 1060 of the Code within
ninety (90) days after the Purchase Price has been determined ("Final
Allocation"). If a Final Allocation is determined, then Purchaser and Seller
agree to provide each other with any necessary information to complete Internal
Revenue Service Form 8594 and to file timely Internal Revenue Service Form 8594
and all Tax Returns, in accordance with any agreed upon Final Allocation.

Section 3.8    Credit Support.

 a. At Closing, Seller shall provide to Purchaser an irrevocable letter of
    credit in the face amount of $9,273,070.40 in substantially the form
    attached as Exhibit D from a United States financial institution acceptable
    to Purchaser but in any event rated and continuing to be rated at least "A"
    by Standard & Poor's Corporation or at least "A2" by Moody's Investors
    Service (the "Letter of Credit"); provided, however, that if no issuer shall
    satisfy such ratings requirement, the next highest investment grade rating
    by such ratings services shall be deemed sufficient. The Letter of Credit
    shall be effective for a period of 12 months after the Closing Date, and
    shall be extended by Seller at least 30 days prior to any expiration thereof
    such that the Letter of Credit shall not expire until all Purchaser Claims
    asserted by Purchaser hereunder on or before the expiration of the survival
    period set forth in Section 11.14(a) have been resolved (such claims being
    referred to hereunder as the "Asserted Purchaser Claims"). The amount
    drawable under the Letter of Credit shall decrease to $4,636,535.20 on the
    date that is 6 months after the Closing Date unless a Asserted Purchaser
    Claim is outstanding on such date, in which case such decrease shall not
    occur until all Asserted Purchaser Claims outstanding on such date have been
    resolved and the amount payable thereunder to Purchaser determined. If the
    undrawn amount of the Letter of Credit exceeds $4,636,535.20 on the date
    that is 6 months after the Closing Date, then Purchaser shall promptly send
    to the issuer of the Letter of Credit a Reduction Certificate (as such term
    is defined in the Letter of Credit) reducing the amount drawable under the
    Letter of Credit to $4,636,535.20 unless an Asserted Purchaser Claim is
    outstanding on such date, in which case Purchaser may delay sending such
    Reduction Certificate until all Asserted Purchaser Claims outstanding on
    such date 6 months after the Closing Date have been resolved and the amount
    payable thereunder to Purchaser determined.

    

    The Letter of Credit may be drawn on by Purchaser:

In the amount agreed upon, if Purchaser and Seller agree to the drawing;

In the amount of any unpaid obligations of Seller under this Agreement or the
Ancillary Agreements with respect to any Asserted Purchaser Claim, if Seller is
obligated to Purchaser with respect to such Asserted Purchaser Claim as
determined by a court of competent jurisdiction in accordance with Section 11.8
pursuant to an unappealable judgment which remains unsatisfied 30 days after
such judgment becomes unappealable;

In the amount of the Letter of Credit or such lesser amount as Purchaser
determines is necessary to satisfy any Asserted Purchaser Claims, upon advance
written notice to Seller, if the Letter of Credit would expire within 60 days
and Seller does not, on or before the later of 30 days prior to the expiration
of the Letter of Credit or 5 days after Purchaser's notice, extend the Letter of
Credit as required above; and

In the amount of the Letter of Credit or such lesser amount as Purchaser
determines is necessary to satisfy any Asserted Purchaser Claims, upon advance
written notice to Seller, if the issuer of the Letter of Credit no longer
satisfies the requirements set forth above and Seller does not provide a
replacement Letter of Credit from an issuer that does satisfy the requirements
within 60 days of Purchaser's notice.

    

 c. In the event of any drawing pursuant to clause (iii) or (iv) above,
    Purchaser shall deposit the proceeds thereof in an interest-bearing
    segregated account of Purchaser for the benefit of Purchaser and Seller as
    set forth herein (but not third parties) with a United States financial
    institution acceptable to Seller but in any event rated and continuing to be
    rated as required of the issuer of the Letter of Credit above. Purchaser
    shall be entitled to apply such proceeds in satisfaction of any unpaid
    obligations of Seller under this Agreement or the Ancillary Agreements with
    respect to any Asserted Purchaser Claims, if and only if Seller is obligated
    to Purchaser with respect thereto by agreement of the Parties or as
    determined by a court of competent jurisdiction in accordance with Section
    11.8 pursuant to an unappealable judgment which remains unsatisfied 30 days
    after such judgment becomes unappealable. In the event that after any
    drawing pursuant to clause (iii) or (iv) above, Seller provides Purchaser
    with a replacement Letter of Credit that satisfies the requirements set
    forth in this Section 3.8 in an amount equal to the unapplied proceeds of
    such drawing, then Purchaser shall cause the unapplied proceeds of such
    drawing to be returned to Seller.

 d. At such time as the survival period described in Section 11.14(a) has
    expired and all outstanding Asserted Purchaser Claims have been resolved,
    Purchaser shall return to Seller the Letter of Credit and any remaining
    proceeds thereof held by Purchaser.
 e. Purchaser shall pay to Seller at Closing an amount equal to fifty percent
    (50%) of the reasonable administrative charges and issuance fees paid by
    Seller to the issuer of the Letter of Credit for issuing and maintaining the
    Letter of Credit for the initial minimum period.
 f. In lieu of posting the Letter of Credit, Seller shall have the option of
    posting cash on terms and conditions that are satisfactory to Purchaser.

 

ARTICLES 4

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Purchaser, as of the Effective Date and as of
the Closing Date, as follows:

Section 4.1    Organization and Existence. Seller is a limited liability
company, duly formed, validly existing and in good standing under the laws of
the State of Delaware and has all requisite power and authority to own, lease
and operate its properties and to carry on its business as now being conducted.
Seller is duly qualified to do business and is in good standing in Mississippi,
the state where the Project is located.

Section 4.2    Execution, Delivery and Enforceability. Seller has all requisite
limited liability company power and authority to execute and deliver, and
perform its obligations under, this Agreement and the Ancillary Agreements to
which it is or becomes a party and to consummate the transactions contemplated
hereby and thereby. The execution and delivery by Seller of this Agreement and
of the Ancillary Agreements to which it is or becomes a party, the performance
by Seller of its obligations hereunder and thereunder and the consummation by
Seller of the transactions contemplated hereby and thereby, have been duly and
validly authorized by all necessary limited liability company action required on
the part of Seller and no other limited liability company proceedings on its
part are necessary to authorize the same. Assuming the due authorization,
execution and delivery by Purchaser and Transmission Purchaser of this Agreement
and the Ancillary Agreements to which either is or becomes a party, this
Agreement constitutes, and the Ancillary Agreements to which Seller is or
becomes a party when executed and delivered by it will constitute, its valid and
legally binding obligations, enforceable against it in accordance with its and
their respective terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws of
general application relating to or affecting the enforcement of creditors'
rights and by general equitable principles.

Section 4.3    No Violation. Subject to Seller obtaining Seller's Required
Consents and Seller's Required Regulatory Approvals, and except for compliance
with the requirements of the HSR Act, neither the execution and delivery by
Seller of this Agreement or any of the Ancillary Agreements to which it is or
becomes a party, nor Seller's performance of compliance with any provision
hereof or thereof, nor Seller's consummation of the transactions contemplated
hereby or thereby will:

violate, or conflict with, or result in a breach of, any provisions of the
Permits or the organizational documents of Seller;

result in a default (or give rise to any right, including any right of
termination, cancellation or acceleration) under, or conflict with, or result in
a breach of, any of the material terms, conditions or provisions of any Project
Contract or any note, bond, mortgage, loan agreement, deed of trust, indenture,
license or agreement or other instrument or obligation to which Seller is a
party or by which Seller or any of the Purchased Assets is bound;

violate any Law or Order applicable to Seller or the Purchased Assets; or

require the declaration, filing or registration with or notice to, authorization
of, consent or approval from any Person.

Section 4.4    Compliance with Laws. To Seller's Knowledge, except as set forth
in Schedule 4.4, Seller is not and will not be (by virtue of any past or present
action, omission to act, Project Contract or any occurrence or state of facts
whatsoever) in violation of, and is not under investigation or threatened in
writing to be under investigation with respect to, any Law or judgment of any
Governmental Authority applicable to Seller or the conduct of the Business.
Prior to the Closing Date, any such uncured violation set forth in Schedule 4.4
shall have been cured.

Section 4.5    Permits. To Seller's Knowledge, Seller holds and is in compliance
with all material Permits required by Law (excluding any of the foregoing
required under any Environmental Law, in respect of which Seller's sole
representations and warranties are set forth in Section 4.16) for the ownership
and operation of the Project and the Business, as currently operated by Seller.
To Seller's Knowledge, each such Permit is in full force and effect and no event
has occurred which permits, or with or without the giving of notice or the
passage of time or both would permit, the revocation, suspension, limitation or
termination thereof. To Seller's Knowledge, there is no condition, circumstance
or issue that represents any material impediment to the assignment of any
Purchased Permit or any condition, circumstance or issue related to Seller that
would prevent Purchaser from obtaining the prompt provision of any other Permit,
in each case with an associated cost not in excess of standard renewal or
application fees, as applicable. Seller has no planned changes to the Project or
the Project Site, including any power uprate, which requires modification of any
Permit which has not yet been obtained.

Section 4.6    Bankruptcy and Insolvency Matters. Seller is not Bankrupt and
there are no proceedings pending or being contemplated by it or, to the best of
Seller's Knowledge, threatened against it, in each case, which could reasonably
be expected to result in it being or, after giving effect to the consummation of
the Transaction, becoming Bankrupt. After giving effect to the consummation of
the Transaction, the fair value of the assets of Seller exceed its liabilities
and the capital of Seller will not be impaired.

Section 4.7    Litigation. Except as set forth in Schedule 4.7, to Seller's
Knowledge there is no claim, action, proceeding or investigation pending or
threatened in writing against Seller before any court, arbitrator or
Governmental Authority, or any judgment, decree, writ, injunction or order of
any court, arbitrator or Governmental Authority binding on Seller (collectively,
"Seller Litigation"); nor to Seller's Knowledge any claim, action, proceeding or
investigation pending or threatened in writing against any of Seller Group
(other than Seller) or any Independent Contractor before any court, arbitrator
or Governmental Authority, or any judgment, decree, writ, injunction or order of
any court, arbitrator or Governmental Authority binding on any of Seller Group
(other than Seller) or any Independent Contractor in any way relating to the
Project, the Business or the Purchased Assets that could reasonably be expected
to have a Material Adverse Effect. Without limiting the foregoing, to Seller's
Knowledge, all claims, actions, proceedings or investigations related to the NEG
Contracts that could materially affect the Seller are subject to a binding
settlement agreement that precludes further claims, actions, proceedings or
investigations by NEG or any of its Affiliates against Seller, the Project, the
Business or the Purchased Assets.

Section 4.8    Contracts. Except for (i) this Agreement, (ii) as of the Closing
Date, any Ancillary Agreement, (iii) any Project Contract listed in Schedules
4.8, 4.11 and 4.12, and (iv) provisions of terminated Project Contracts that
expressly survive their termination but are not the subject of any current
application, to the Knowledge of Seller, Seller is not bound by or subject to,
and none of the Project, the Business or the Purchased Assets is bound by or
subject to, any Contract.

Section 4.9    Purchased Project Contracts.

Except as set forth in Part I of Schedule 4.9, no default, event of default or
other event which, with notice or lapse of time or both, would constitute a
default, has occurred or exists under any of the Purchased Project Contracts,
except for such defaults, events of default and other events as to which
requisite waivers have been obtained.

Except as set forth in Part II of Schedule 4.9, no claim, action, proceeding or
investigation, is pending or threatened against Seller challenging the
enforceability of any of the Purchased Project Contracts.

Except for the Purchased Project Contracts listed under the caption "Software
Licenses" on Schedule 2.1(e), each Purchased Project Contract constitutes the
valid and binding obligation of Seller and the other parties thereto,
enforceable in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws of general application relating to or affecting the enforcement of
creditors' rights and by general equitable principles.

Section 4.10    Conveyance of Title. Except for the Purchased Project Contracts
listed under the caption "Software Licenses" on Schedule 2.1(e), (a) Seller has
good and marketable title to each item of property included in the Purchased
Assets, free and clear of all Encumbrances, except Permitted Encumbrances and
(b) Seller will convey to Purchaser at the Closing good and marketable title to
each item of property included in the Purchased Assets, free and clear of all
Encumbrances, except Permitted Encumbrances.

Section 4.11    Real Property. Schedule 4.11 sets forth a description of the
Owned Real Property. Seller has good and marketable fee simple title in all of
the Owned Real Property (except in the case of a servitude or easement, in which
case Seller shall convey good and marketable title in its rights as grantee and
owner of the dominant estate thereunder), free and clear of all Encumbrances,
except Permitted Encumbrances. Seller will convey to Purchaser at Closing, good
and marketable fee simple title in all of the Owned Real Property (except in the
case of a servitude or easement, in which case Seller shall convey good and
marketable title in its rights as grantee and owner of the dominant estate
thereunder), free and clear of all Encumbrances, except Permitted Encumbrances.
Except as set forth in Schedule 4.11, there are no proceedings pending for the
reduction or any contemplated increase in, the assessed valuation of the Owned
Real and Personal Property.

Section 4.12    Leased Real and Personal Property. Schedule 4.12 sets forth a
list and description of the Leased Real and Personal Property. Seller has, and
will convey to Purchaser at the Closing, good and valid leasehold interests in
the Leased Real and Personal Property free and clear of all Encumbrances, except
Permitted Encumbrances.

Section 4.13    Condition of Purchased Assets; All Necessary Purchased Assets.

 a. To Seller's Knowledge, all of the tangible personal property included in the
    Purchased Assets is in good operating condition and repair, subject only to
    ordinary wear and tear and has been maintained by Seller since March 5,
    2004, in accordance with Good Utility Practices, except as set forth in
    Schedule 4.13. To Seller's Knowledge, none of the tangible personal property
    included in the Purchased Assets is in need of repair or replacement other
    than as part of routine maintenance in the ordinary course of business,
    except as set forth in Schedule 4.13.

    Except (i) to the extent of any immaterial or unnecessary contract,
    agreement, license, lease or Permit relating to the ownership, operation and
    maintenance of the Purchased Assets that is not assignable in whole or in
    part to Purchaser, (ii) for changes occurring after the Effective Date in
    the ordinary course of the conduct of the Business consistent with past
    practices and the provisions of this Agreement, including assets consumed in
    the ordinary course of business, and (iii) for Excluded Assets; the
    Purchased Assets and the Transmission Assets constitute (A) all of the
    assets used by Seller in connection with the ownership, operation and
    maintenance of the Project since Seller's acquisition of the Project on
    March 5, 2004, and (B) to Seller's Knowledge, constitute all of the assets,
    properties, rights (including any real property rights), consents and
    interests necessary for the use, operation and maintenance of the Project
    consistent with Good Utility Practices.

Section 4.14    Intellectual Property. Seller owns or, pursuant to the Project
Contracts listed on Schedule 4.8 under the caption "Software Licenses" otherwise
possesses sufficient rights to use such patents, copyrights, trademarks, service
marks, technology, know-how, computer software programs and applications,
databases and tangible or intangible proprietary information or materials (the
"Intellectual Property Rights") as are currently used in connection with the
operation of the Project; provided that Seller makes no representation under
this Section 4.14 with respect to such Project Contracts and the Intellectual
Property Rights thereunder other than that Seller has not received a notice from
any Person asserting that it is in violation of such Project Contracts and the
Intellectual Property Rights thereunder, or does not hold a valid license of,
such Intellectual Property Rights.

Section 4.15    Brokers. All negotiations relating to this Agreement and the
Transactions have been carried on by Seller and in such a manner as not to give
rise to any valid claim against Purchaser or any of its Affiliates (by reason of
Seller's actions) for a brokerage commission, finder's fee or other like payment
to any Person.

Section 4.16    Environmental Matters.

(a)     To Seller's Knowledge Schedule 4.16 sets forth all Environmental Permits
applicable to the Project or the Project Site, as well as any pending
applications for modification, renewal, issuance or extension of any such
Environmental Permits. Assuming that Purchaser meets the requirements to receive
such Environmental Permits, to Seller's Knowledge, there are no impediments to
the prompt renewal, transfer or extension of any such Environmental Permits as
currently issued in final or draft form with an associated cost not in excess of
standard modification, renewal or extension fees. To Seller's Knowledge, Seller
has not generated, transported, released, used, stored, treated, disposed of,
handled or managed any Hazardous Substance relating to the Project, except in
compliance with all Environmental Laws. Except as set forth in Schedule 4.16, to
Seller's Knowledge (i) the Project and the Project Site are in compliance in all
material respects with Environmental Laws and Environmental Permits; and (ii)
the Project and the Project Site are not the subject of any administrative,
regulatory or judicial action, suit, investigation, proceeding, decree or claim
relating to any Environmental Law or Environmental Permit. Except as set forth
in Schedule 4.16, Seller does not presently own, operate, lease or use any
above-ground storage tanks, underground storage tanks or other process tanks
relating to the Project or at the Project Site. To Seller's Knowledge, no
Environmental Condition currently exists at the Project or at the Project Site.

(b)     Except as set forth in Schedule 4.16, Seller previously has not sought
or obtained, nor to Seller's Knowledge has there been or is there currently
environmental-insurance coverage for the Project or the Project Site.

(c)     Except as set forth in Schedule 4.16, Seller has obtained or has a right
to (or, prior to the Closing Date, will have obtained or have a right to) all
Emission Allowances required by Environmental Laws for the current and
anticipated future use of the Project or the Project Site during each year until
the year in which the Closing occurs, and each of such Emission Allowances are,
or are expected to be, in full force and effect, have been allocated or reserved
for the Project or the Project Site and are not otherwise subject to sale, loss
or diminution.

Section 4.17    Tax Matters.
 a. Seller has prepared in good faith and duly and timely filed or caused to be
    duly and timely filed all Income Tax Returns required to be filed with
    respect to Income Taxes for which Seller is or could be liable for taxable
    periods (or portions thereof) ending on or before Closing Date relating to
    the Business and the Purchased Assets (if any), which Tax Returns are true,
    correct and complete in all material respects. Seller has paid all Income
    Taxes shown to be due on the Income Tax Returns. All Income Taxes (if any)
    imposed with respect to the Purchased Assets for which Seller is or could be
    liable to other entities (as, for example, under Tax allocation agreements
    or partnership agreements) with respect to all taxable periods (or portions
    thereof) ending on or before Closing Date have been paid.

    Seller has prepared in good faith and duly and timely filed or caused to be
    duly and timely filed all Tax Returns required to be filed with respect to
    Taxes (other than Income Taxes) for which Seller is or could be liable for
    taxable periods (or portions thereof) ending on or before Closing Date
    relating to the Business and the Purchased Assets, which Tax Returns are
    true, correct and complete in all material respects. With respect to all
    amounts in respect of Taxes other than Income Taxes imposed with respect to
    the Purchased Assets for which Seller is or could be liable, whether to Tax
    authorities (as, for example, under Law) or to other entities (as, for
    example, under Tax allocation agreements or partnership agreements) with
    respect to all taxable periods (or portions thereof) ending on or before
    Closing Date, all applicable Tax Laws and agreements have been complied with
    and all such amounts required to be paid by Seller to Tax authorities or
    others have been paid.

 b. Except as set forth on Schedule 4.11, Seller is not a party to any action or
    proceeding, nor is any such action or proceeding threatened in writing, for
    the assessment or collection of any Taxes relating to the Business or the
    Purchased Assets for which Seller is or could be liable, and no deficiency
    notices or reports have been received by Seller in respect of any such Tax.

Section 4.18    Project Employee Matters. No Project Employees are or have been
employees of Seller. To the Knowledge of Seller, with respect to the Project
Employees of others, (i) no current or former Project Employees are represented
by any union or labor organization, (ii) there is no labor strike, slowdown or
work stoppage pending or threatened by any current or former Project Employees
relating to or affecting the Project, and (iii) there is no pending or
threatened claim by any current or former Project Employees or any Governmental
Authority alleging any non-compliance under Law relating directly or indirectly
to employment or workplace conditions or practices related to the Project, and
Seller and all Independent Contractors are in compliance with all such Laws as
they relate to current and former Project Employees.

Section 4.19    Project Employee Benefit Plans. Seller has not at any time
sponsored, maintained or contributed to (i) an employee pension benefit plan (as
defined in ERISA Section 3(2) which was (or is) subject to Title IV of ERISA or
(ii) a multiemployer pension plan (as defined in ERISA Section 4001(a)(3)).

Section 4.20    Regulatory Status. Seller was determined by FERC to be an exempt
wholesale generator within the meaning of Section 32 of the Public Utility
Holding Company Act of 1935 (an "EWG") by order dated December 23, 2003 in
Docket No. EG04-16-000. To Seller's Knowledge there has been no challenge to
such EWG status.

Section 4.21    Full Disclosure. No representation or warranty of Seller
contained in this Agreement or in any statement, information, Schedule or
certificate furnished or to be furnished by or on behalf of Seller pursuant
hereto or in connection with the transactions contemplated hereby contains or
will contain any untrue statement of a material fact or to Seller's Knowledge
omits or will omit to state a material fact necessary in order to make the
statements contained herein or therein not misleading.

Section 4.22    Warranties. Schedule 2.1(h) identifies (a) to Seller's
Knowledge, all of the warranties made or given by any Person in connection with
or with respect to any of the Purchased Assets, including any warranties against
defects in materials and/or workmanship, any extended warranties given in
connection with any repaired or replaced work and any warranties that any Person
may have assigned to Seller, (b) the Person who made or gave each such warranty,
(c) if any such warranty was made or given to any Person other than Seller, the
Person to whom such warranty was made or given, (d) the Purchased Assets to
which each such warranty relates and (e) the duration of each such warranty.
Seller holds and has the right to enforce all of the warranties identified in
Schedule 2.1(h). Seller has furnished to Purchaser true, correct and complete
copies of, all of the warranties identified in Schedule 2.1(h) and any agreement
or instrument assigning or transferring any of such warranties.

Section 4.23    Financial Statements; Undisclosed Liabilities.

 a. Seller has provided Purchaser with true and correct copies of its Monthly
    Operating Reports since Seller's acquisition of the Project. The Monthly
    Operating Reports present fairly, in all material respects, the results of
    operations of Seller for the periods therein. The Monthly Operating Reports
    have been prepared from the books and records of Seller.

    Except as set forth on Schedule 4.23(b), there are no liabilities of Seller
    of any kind whatsoever, whether accrued, contingent, absolute, determined,
    determinable or otherwise, and there is no existing condition, situation or
    set of circumstances which could reasonably be expected to result in such a
    liability, other than operating and other current liabilities incurred in
    the ordinary course of business consistent with past practice that do not
    exceed $300,000 in unpaid aggregate outstanding amount at any one time or
    require payments in excess of $175,000 to satisfy in the ordinary course of
    business during any month.

Section 4.24    Accuracy of Information. Seller has furnished or made available
to ESI or Purchaser all documents, books, records, materials and other relevant
information in Seller's custody and control related to the Project. Such
information accurately presents the condition, operations and operating
characteristics of the Project, including the Purchased Assets, and, except as
set forth in Schedule 4.24, there has been no adverse material change in the
condition, operations or operating characteristics of the Project, including the
Purchased Assets, from the date any such information was provided.

Section 4.25    Required Consents. Except for any consent required to transfer
to Purchaser the Purchased Project Contracts described on Schedule 2.1(e) under
the captions "Purchase Orders" and "Software Licenses", Schedule 4.25 sets forth
each Seller's Required Consent and Seller's Required Regulatory Approval that is
necessary with respect to the execution, delivery and performance of this
Agreement or the consummation of the Transactions in order to avoid the
violation or breach of, or the default under, or the creation of an Encumbrance
on the Purchased Assets pursuant to the terms of, any Law or Order of any
Governmental Authority or any Project Contract.

Section 4.26    Absence of Certain Changes. Except as set forth in Schedule
4.26, since the date of Seller's acquisition of the Project, Seller has operated
and maintained the Project and the Business in accordance with Good Utility
Practices, and has not:
 a. amended, terminated, renegotiated or, except as required by their terms,
    renewed any existing Transmission Purchase Agreement or Purchased Project
    Contract; or waived any default by, or released, settled or compromised any
    claim against, any other party to any Transmission Purchase Agreement or
    Purchased Project Contract;

    sold, leased, transferred or disposed of, or entered into any Contract for
    the sale, lease, transfer or disposition of, any assets or properties which
    would be included in the Purchased Assets, except sales, leases, transfers
    or dispositions of Purchased Inventory or in the ordinary course of business
    consistent with past practices and Good Utility Practices;

    incurred any obligations for borrowed money or guaranteed or otherwise
    become liable for the obligations of, or make any loans or advances to, any
    Person, or delayed the payment or discharge of any liability;

    granted or otherwise taken any action or intentional inaction resulting in
    any Encumbrance on any Purchased Assets, except Permitted Encumbrances;

    failed to maintain in force and effect the material property and liability
    insurance policies related to the Project;

 b. suffered any damage or destruction adversely affecting the Project, the
    Business or the Purchased Assets; or

    agreed in writing, or otherwise, to take any action described in this
    Section.

Section 4.27    Affiliates of Seller. Seller has no Affiliates other than the
Seller Trust. The Seller Trust has no Affiliates other than the Seller, and the
sole owners of the Seller Trust are the members of the Seller Group specifically
identified by name in the definition of Seller Group.

Section 4.28    No Third Party Options. There are no Contracts, options,
commitments or rights with, of or to any Person to acquire any assets,
properties or rights of Seller or any interest in such assets, properties or
rights.

Section 4.29    Insurance Coverage. Seller has furnished to Purchaser a summary
of all insurance policies and fidelity bonds covering the Business or any
employee or Independent Contractor of Seller. There are no pending claims by
Seller under any of such policies or bonds as to which coverage has been
questioned, denied or disputed by the underwriters of such policies or bonds.

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser represents and warrants to Seller, as of the Effective Date and as of
the Closing Date, as follows:

Section 5.1    Organization and Existence. Purchaser is a corporation, duly
organized, validly existing and in good standing under the laws of the State of
Mississippi, and has all requisite corporate power and authority to own, lease
and operate its properties and to carry on its business as now being conducted.

Section 5.2    Execution, Delivery and Enforceability. Purchaser has all
requisite corporate power and authority to execute and deliver, and to perform
its obligations under, this Agreement and the Ancillary Agreements to which
Purchaser is or becomes a party and to consummate the transactions contemplated
hereby and thereby. The execution and delivery by Purchaser of this Agreement
and of the Ancillary Agreements to which Purchaser is or becomes a party, the
performance by Purchaser of its obligations hereunder and thereunder and the
consummation by Purchaser of the transactions contemplated hereby and thereby,
have been duly and validly authorized by all necessary corporate action required
on the part of Purchaser and no other corporate proceedings on its part are
necessary to authorize the same. Assuming the due authorization, execution and
delivery by Seller and Transmission Purchaser of this Agreement and the
Ancillary Agreements to which either is or becomes a party, this Agreement
constitutes, and the Ancillary Agreements to which Purchaser is or becomes a
party when executed by Purchaser will constitute, the valid and legally binding
obligations of Purchaser, enforceable against Purchaser in accordance with its
and their respective terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws of
general application relating to or affecting the enforcement of creditors'
rights and by general equitable principles.

Section 5.3    No Violation. Subject to Purchaser obtaining Purchaser's Required
Regulatory Approvals and Purchaser's Required Consents, and except for
compliance with the requirements of the HSR Act, neither the execution and
delivery by Purchaser of this Agreement or any of the Ancillary Agreements to
which it is or becomes a party, nor Purchaser's compliance with any provision
hereof or thereof, nor Purchaser's consummation of the transactions contemplated
hereby or thereby will:
 a. violate, or conflict with, or result in a breach of any provisions of the
    Articles of Incorporation or Bylaws of Purchaser;

    result in a default (or give rise to any right of termination, cancellation
    or acceleration) under, or conflict with, or result in a breach of, any
    material terms, conditions or provisions of any material note, bond,
    mortgage, loan agreement, deed of trust, indenture, license or agreement or
    other instrument or obligation to which Purchaser is a party or by which
    Purchaser is bound;

    violate any law, writ, injunction or decree, applicable to Purchaser or any
    of its assets; or

 b. require the consent, approval or authorization of or from any Person which,
    if not obtained, would prevent Purchaser from performing its obligations
    hereunder, or require the declaration, filing or registration with or notice
    to, authorization of, consent or approval from any Person which, if not
    made, would prevent, materially delay or materially impair Purchaser's
    performance of its obligations hereunder or materially impair Purchaser's
    authority, right or ability to consummate the Transactions.

Section 5.4    Brokers. All negotiations relating to this Agreement and the
Transactions have been carried on by Purchaser and in such a manner as not to
give rise to any valid claim against Seller (by reason of Purchaser's actions)
for a brokerage commission, finder's fee or other like payment to any Person.

Section 5.5    Litigation. Except as set forth in Schedule 5.5 or reported in
Section 6.3(c), to Purchaser's Knowledge there is no claim, action, proceeding
or investigation pending or threatened in writing against Purchaser or any of
its Affiliates before any court, arbitrator or Governmental Authority, or any
judgment, decree, writ, injunction or order of any court, arbitrator or
Governmental Authority binding on Purchaser or any of its Affiliates relating to
any of the Purchased Assets or the Transactions, which, individually or in the
aggregate, could reasonably be expected to result, or has resulted, in (a) the
institution of legal proceedings to prohibit or restrain the performance by
Purchaser of Purchaser's obligations under this Agreement or any of the
Ancillary Agreements to which Purchaser is or becomes a party, or the
consummation of the transactions contemplated hereby or thereby, (b) a claim
against Seller for damages as a result of Purchaser entering into this Agreement
or any of the Ancillary Agreements to which Purchaser is or becomes a party or
the consummation by Purchaser of the transactions contemplated hereby or thereby
or (c) a material delay in or material impairment of Purchaser's performance of
its obligations under this Agreement or any of the Ancillary Agreements to which
Purchaser is or becomes a party or a material impairment of the authority, right
or ability of Purchaser to consummate the transactions contemplated hereby or
thereby.

Section 5.6    Financial Statements. Purchaser has provided Seller with true and
correct copies of its audited balance sheet, income statement and statement of
changes in cash flows for its fiscal year ending December 31, 2003, together
with the related reports of its independent accountants, and for its fiscal
quarter ending September 30, 2004 (collectively, the "Purchaser Financial
Statements"). The Purchaser Financial Statements have been prepared in
accordance with GAAP consistently applied and present fairly, in all material
respects, the financial position, results of operations and cash flow of
Purchaser at and for the periods therein. The Purchaser Financial Statements
have been prepared from the books and records of Purchaser. All adjustments,
consisting of normal, recurring accruals necessary for a fair presentation, have
been made in the Purchaser Financial Statements.

Section 5.7    No Additional Representations and Warranties. Purchaser
acknowledges and agrees that, except as otherwise expressly set forth in this
Agreement or any Ancillary Agreement, (a) Seller makes no representations or
warranties about the Purchased Assets, the Project or the Project Site, and (b)
the Purchased Assets shall be transferred to Purchaser in their condition at the
time of Closing, AS-IS, WHERE-IS, without any further representation or warranty
of condition whatsoever and without any further representation or warranty that
the Purchased Assets are free from latent defects or vices.

Section 5.8    No Knowledge of Breach. As of the Effective Date, Purchaser
acknowledges and agrees that it has no Knowledge of any breach by Seller of any
of the representations and warranties of Seller contained in this Agreement or
any of the Ancillary Agreements and Purchaser hereby waives any right to assert
any breach of any of the representations and warranties of Seller of which
Purchaser had Knowledge as of the Effective Date.

ARTICLE 6

COVENANTS OF EACH PARTY

Section 6.1    Efforts to Close. Subject to the terms and conditions herein,
each of the Parties hereto shall use its Commercially Reasonable Efforts to
consummate and make effective, as soon as reasonably practicable, the Purchaser
Transactions, including the satisfaction of all conditions thereto set forth
herein. Such actions shall include, in the case of Seller, (a) exercising its
Commercially Reasonable Efforts to obtain (i) each of the Real Estate Curative
Documents (as defined in Section 8.17(h)) and (ii) each of the consents,
waivers, authorizations and approvals of any Governmental Authority or other
Person which is reasonably necessary to effectuate the Transactions or which is
required to transfer, convey and assign to Purchaser at the Closing any and all
rights of Seller, including contractual rights, necessary to operate the
Purchased Assets, including Seller's Required Regulatory Approvals, Seller's
Required Consents and the Title Policy and effecting all other necessary
notifications, registrations and filings, including, without limitation, filings
under applicable Laws, including the HSR Act, and all other necessary filings
with any Governmental Authority having jurisdiction over Seller or the Project
and (b) executing the Termination of Pre-Closing Interconnection Letter promptly
after the execution of this Agreement and sending the executed Letter to
Purchaser. Such actions shall include, in the case of Purchaser, exercising its
Commercially Reasonable Efforts to (a) obtain each of the consents, waivers,
authorizations and approvals of any Governmental Authority or other Person which
is reasonably necessary to effectuate the Purchaser Transactions, including
Purchaser's Required Regulatory Approvals, Purchaser's Additional Regulatory
Approvals and Purchaser's Required Consents, and effecting all other necessary
notifications, registrations and filings, including, without limitation, filings
under applicable Laws, including the HSR Act, and all other necessary filings
with any Governmental Authority having jurisdiction over Purchaser or any of the
Participating Entergy Operating Companies and (b) within a reasonable period of
time after its receipt of the Termination of Pre-Closing Interconnection Letter
from Seller, make all necessary filings with the applicable Governmental
Authority to effect the termination of the agreement described therein as of the
Closing Date.

Section 6.2    Expenses. Whether or not the Transactions are consummated, except
as otherwise provided in the Adjustment Sections or any other provision of this
Agreement, all costs and expenses incurred in connection with this Agreement and
the Purchaser Transactions shall be paid by the Party incurring such expenses.
Notwithstanding the foregoing, with respect to the Purchaser Transactions
(i) costs associated with preliminary title reports or commitments and the Title
Policy and any endorsements required by Purchaser shall be borne jointly;
(ii) documentary transfer fees, if any, will be borne in accordance with
customary practices in Mississippi; (iii) recording costs and charges respecting
real property comprising part of the Purchased Assets will be borne by
Purchaser, except that Seller shall bear the cost of releasing any Encumbrances
(other than Permitted Encumbrances) on the Purchased Assets, such as releasing
any mechanic's or materialmen's liens; (iv) except as otherwise specifically set
forth in Section 6.6, all fees, charges and costs of economists and other
experts, if any, jointly retained by Purchaser and Seller in connection with
submissions made to any Governmental Authority and advice in connection
therewith respecting approval of the Purchaser Transactions will be borne
jointly; and (v) the filing fee payable in connection the notifications required
to be filed under the HSR Act and the rules and regulations promulgated
thereunder with respect to the Purchaser Transactions shall be borne by
Purchaser. All such charges and expenses shall be promptly settled between the
Parties at the Closing or upon termination or expiration of further proceedings
under this Agreement, or with respect to such charges and expenses not
determined as of such time, as soon thereafter as is reasonably practicable.

Section 6.3    Notice of Certain Events.
 a. Upon obtaining Knowledge of the same, Seller shall promptly notify Purchaser
    in writing of (i) any fact or condition that causes or constitutes a
    misrepresentation or breach of any of Seller's representations and
    warranties made as of the Effective Date; (ii) any changes or events which,
    individually or in the aggregate, have had or could reasonably be expected
    to have an unremedied Material Adverse Effect as of the Closing Date or
    otherwise result in any representation or warranty of Seller under this
    Agreement being inaccurate in any respect; (iii) any notice or other
    communication from any Person alleging that the consent of such Person is or
    may be required in connection with the Transactions to the extent such
    consent is not otherwise contemplated hereunder; (iv) any notice or other
    communications from any Governmental Authority in connection with the
    Transactions; (v) any damage, destruction or other casualty loss (whether or
    not covered by insurance) with respect to the Project; (vi) any breach of or
    failure to perform any covenant of Seller under this Agreement; (vii) any
    notice of breach or other material notice given or received under the
    Transmission Assets Purchase and Sale Agreement, and (viii) any fact or
    condition that may make the satisfaction of the conditions in Articles 8 or
    9 impossible or unlikely. No such notification made pursuant to this Section
    6.3(a), Section 6.3(b) or otherwise shall be deemed to cure any inaccuracy
    of any representation or warranty of Seller or limit in any way Purchaser's
    exercise of its rights under this Agreement.

    

 b. Seller agrees to provide Purchaser with periodic reports regarding the
    status of Seller's efforts to satisfy the conditions precedent in Sections
    8.12, 8.15 and 8.17 and other conditions reasonably requested by Purchaser
    from time to time, and regarding the expenditures made to satisfy its
    obligations to use Commercially Reasonable Efforts to the extent the same
    are to be applied against the limitation specified in the definition of such
    term.

    Upon obtaining Knowledge of the same, Purchaser shall promptly notify Seller
    in writing of (i) any fact or condition that causes or constitutes a
    misrepresentation or breach of any of Purchaser's representations and
    warranties made as of the Effective Date; (ii) any changes or events which,
    individually or in the aggregate, have had or could reasonably be expected
    to result in any representation or warranty of Purchaser under this
    Agreement being inaccurate in any respect; (iii) any notice or other
    communication from any Person alleging that the consent of such Person is or
    may be required in connection with the Purchaser Transactions to the extent
    such consent is not otherwise contemplated hereunder; (iv) all filings made
    by Purchaser Group to any Governmental Authority in connection with
    obtaining any of Purchaser's Required Regulatory Approvals and Purchaser's
    Additional Regulatory Approvals; (v) any breach of or failure to perform any
    covenant of Purchaser under this Agreement; and (vi) any fact or condition
    that may make the satisfaction of the conditions in Articles 8 or 9
    impossible or unlikely. No such notification made pursuant to this Section
    6.3(c), Section 6.3(d) or otherwise shall be deemed to cure any inaccuracy
    of any representation or warranty of Purchaser or limit in any way Seller's
    exercise of its rights under this Agreement.

    Purchaser agrees to provide Seller with periodic reports regarding the
    status of Purchaser's efforts to obtain Purchaser's Required Regulatory
    Approvals and Purchaser's Additional Regulatory Approvals following the
    occurrence of material events with respect thereto or upon request of
    Seller.

Section 6.4    Conduct Pending Closing. Prior to consummation of the
Transactions or the termination or expiration of this Agreement pursuant to its
terms, unless Purchaser shall otherwise consent in writing, and except (i) for
actions which are required by Law, (ii) for reasonable actions taken in
connection with any emergency force majeure event and promptly disclosed in
writing to Purchaser, (iii) for actions which arise solely from or are related
to and only affect the Excluded Assets or the Excluded Liabilities, or the
anticipated transfer of the Purchased Assets, or (iv) as otherwise contemplated
by this Agreement or disclosed in Schedule 6.4, Seller shall:

 a. Operate and maintain the Project, or cause the Project to be operated and
    maintained, in all material respects in accordance with the ordinary course
    of business consistent with past practices and Good Utility Practices and
    applicable Laws, including Environmental Laws, and maintain in effect the
    Interim LTSA and otherwise ensure the provision of customary maintenance of
    the combustion and steam turbines of the Project in compliance with GEII's
    technical requirements and information;

    Not amend, terminate, renegotiate or, except as required by their terms,
    renew any existing Transmission Purchase Agreement or Project Contract or
    enter into any new Project Contract that would (if it existed on the date
    hereof) have been required to be listed in Schedule 4.8, or default (or take
    or omit to take any action that, with the giving of notice or passage of
    time or both, would constitute a default) under Seller's obligations under
    any Transmission Purchase Agreement or Project Contract or waive any default
    by, or release, settle or compromise any claim against, any other party to a
    Transmission Purchase Agreement or Project Contract;

    Not sell, lease, transfer or dispose of, or make any contract for the sale,
    lease, transfer or disposition of, any material assets or properties which
    would be included in the Purchased Assets, except disposition of Consumables
    in the ordinary course of business;

    Not (i) incur any obligations for borrowed money or guarantee or otherwise
    become liable for the obligations of, or make any loans or advances to, any
    Person, except as would after the Closing constitute an Excluded Liability
    or (ii) delay the payment or discharge of any liability under the Interim
    LTSA or which, upon the Closing, would be an Assumed Liability, whether
    because of the Transactions or otherwise;

    Not grant any Encumbrance on any Purchased Assets, except Permitted
    Encumbrances;

 b. Maintain or cause to be maintained in force and effect the material property
    and liability insurance policies related to the Project;

    

 c. Ensure that the inventory of Consumables reflected on the Closing Inventory
    Report shall not be less than the inventory of Consumables reasonably
    necessary for the operation of the Project for not less than the thirty (30)
    day period following the Closing;

    Not take any action which would cause any of Seller's representations and
    warranties set forth in Article 4 to be untrue in any material respect as of
    the Closing;

    Use Commercially Reasonable Efforts (i) to document, or cause to be
    documented, prior to the Closing, the complete terms of all Warranties the
    complete terms of which are not documented as of the Effective Date and (ii)
    to obtain assignments from third parties to Seller of all Warranties which,
    as of the Effective Date, are made to any Person other than Seller; and

    Not, without first consulting with Purchaser regarding the same, resolve,
    settle or compromise any material Environmental Condition, Environmental
    Claim or Environmental Liability, including without limitation with any
    Governmental Authority, which could impose any post-Closing liabilities on
    Purchaser or require any post-Closing Remediation;

provided

, however, that nothing in this Section 6.4 shall (i) obligate Seller to make
expenditures other than in the ordinary course of business consistent with past
practices, (ii) preclude Seller from paying, prepaying or otherwise satisfying
any liability which, if outstanding as of the Closing Date, would be an Assumed
Liability or an Excluded Liability, (iii) preclude Seller from incurring any
liabilities or obligations to any third party in connection with obtaining such
Party's consent to any transaction contemplated by this Agreement or the
Ancillary Agreements provided such liabilities and obligations incurred under
this clause (iii) shall be Excluded Liabilities or (iv) preclude Seller from
instituting, participating in or completing any program designed to promote
compliance or comply with applicable Laws or Good Utility Practices with respect
to the Project or Purchased Assets or (v) obligate Seller to acquiesce in any
reduction in the Purchase Price.

Section 6.5    Regulatory Approvals.

 a. Subject to Section 6.1, as promptly as practicable after the Effective Date,
    but in any event on a mutually agreed date, Seller and Purchaser shall each
    file or cause to be filed with the Federal Trade Commission and the
    Department of Justice all notifications required to be filed under the HSR
    Act and the rules and regulations promulgated thereunder with respect to the
    Purchaser Transactions at Purchaser's sole cost and expense. The Parties
    shall consult with each other as to the appropriate time of filing such
    notifications and shall agree in good faith upon the timing of such filings
    and use Commercially Reasonable Efforts to cause the waiting periods under
    the HSR Act to terminate or expire at the earliest possible date after the
    date of filing.

    Subject to Section 6.5(e) each Party, as to itself, shall:

    promptly enter into negotiations, provide information or make proposals to
    the extent necessary to eliminate any concerns on the part of any
    Governmental Authority (other than a Governmental Authority having authority
    over retail utility rates) regarding the legality under any applicable Law
    of the consummation of the Purchaser Transactions;
    
    use Commercially Reasonable Efforts to prevent the entry in a judicial or
    administrative proceeding brought by any Governmental Authority or any other
    party for a permanent or preliminary injunction, temporary restraining order
    or other order that would make consummation of the Purchaser Transactions
    unlawful or that would prevent or delay such consummation; and
    
    take promptly, in the event that such an injunction or order has been issued
    in such a proceeding, any and all Commercially Reasonable Efforts, including
    the appeal thereof, the posting of a bond or the steps contemplated by
    Section 6.5(b)(i), necessary to vacate, modify or suspend such injunction or
    order so as to permit such consummation on a schedule as close as possible
    to that contemplated by this Agreement.

 b. Subject to Section 6.1, Purchaser shall have the responsibility for securing
    the transfer, reissuance or procurement of the Permits effective as of the
    Closing Date. Seller shall use Commercially Reasonable Efforts to cooperate
    and assist with Purchaser's transfer, reissuance or procurement of Permits,
    including without limitation by executing any required forms or providing
    timely and appropriate notices to Governmental Authorities for Purchaser to
    obtain all Permits that are to be transferred to it, reissued or procured
    pursuant to Section 2.1(f). Purchaser and Seller further acknowledge and
    agree that such action may be required prior to, on or after the Closing
    Date.

    Subject to Section 6.1, Purchaser and Seller shall each take all
    Commercially Reasonable Efforts, including without limitation executing any
    required forms or providing appropriate notices to Governmental Authorities,
    in a timely fashion, for Purchaser to obtain all, or the rights to all,
    Emission Allowances that are to be transferred to it pursuant to Section
    2.1(k). Purchaser and Seller further acknowledge and agree that such actions
    may be required prior to, on or after the Closing Date.

    Notwithstanding anything herein to the contrary, nothing in this Agreement
    shall require Purchaser or any of its Affiliates to dispose of or sell any
    assets or properties or businesses, hold separate particular assets or
    categories of assets or properties or businesses, or agree to dispose of or
    hold separate one or more assets or properties.

Section 6.6    Tax Matters.
 a. All Transfer Taxes incurred in connection with this Agreement and the
    Ancillary Agreements (other than the Transmission Purchase Agreements) and
    the transactions contemplated hereby and thereby (whether imposed on Seller
    or Purchaser) shall be borne in accordance with customary practices in
    Mississippi. Purchaser or Seller will timely prepare and file, to the extent
    required by applicable Law, all necessary Tax Returns and other
    documentation with respect to all such Transfer Taxes, and timely pay the
    amount shown as due on such Tax Returns to the applicable Governmental
    Authority.

    With respect to Property Taxes to be prorated in accordance with Section 3.4
    of this Agreement, Purchaser shall prepare and timely file all Tax Returns
    related thereto and required to be filed after the Closing with respect to
    the Purchased Assets, if any, and shall duly and timely pay all such
    Property Taxes shown to be due on such Tax Returns. Purchaser's preparation
    of any such Tax Returns shall be subject to Seller's approval, which
    approval shall not be unreasonably withheld or delayed. Purchaser shall make
    such Tax Returns available for Seller's review and approval no later than
    twenty (20) Business Days prior to the due date for filing such Tax Returns,
    it being understood that Seller's failure to approve any such Tax Returns
    shall not limit Purchaser's obligation to timely file such Tax Returns and
    duly and timely pay all Property Taxes shown to be due thereon. Not less
    than five (5) Business Days prior to the due date of any such Property
    Taxes, Seller shall pay to Purchaser the amount shown as due on such Tax
    Returns as determined in accordance with Section 3.4 of this Agreement to be
    the responsibility of Seller and to the extent required by Law, Seller shall
    join in the execution of any such Tax Returns.

    With respect to prorated Property Taxes to be paid by Seller, Seller's
    preparation of any Tax Return relating to a lien for Property Taxes on or
    related to the Purchased Assets that will arise after the Closing Date shall
    be subject to Purchaser's approval, which approval shall not be unreasonably
    withheld or delayed. Seller shall make such Tax Returns available for
    Purchaser's review and approval no later than twenty (20) Business Days
    prior to the due date for filing such Tax Return, it being understood that
    Purchaser's failure to approve any such Tax Return shall not limit Seller's
    obligation to timely file such Tax Returns and duly and timely pay all
    Property Taxes shown to be due thereon. Not less than five (5) Business Days
    prior to the due date of any such Property Taxes, Purchaser shall pay to
    Seller the amount shown as due on such Tax Returns as determined in
    accordance with Section 3.4 of this Agreement to be the responsibility of
    Purchaser and to the extent required by Law, Purchaser or any of its
    Affiliates shall join in the execution of any such Tax Returns. In preparing
    and reviewing such Tax Returns, the Parties shall cooperate and act in good
    faith to resolve any disagreement related to such Tax Returns as between the
    Parties or as between either Party and any Governmental Authority.

 b. Purchaser and Seller shall provide the other Party with such assistance as
    may reasonably be requested by the other Party in connection with the
    preparation and filing of any Tax Return referred to in this Section 6.6,
    any audit or other examination by any Tax authority related to Taxes
    referred to in this Section 6.6, or any judicial or administrative
    proceedings relating to liability for such Taxes, and each will retain and
    provide the requesting Party with any records or information which may be
    relevant to such return, audit or examination, proceedings or determination.
    Any information obtained pursuant to this Section 6.6 or pursuant to any
    other Section hereof providing for the sharing of information relating to or
    review of any such Tax Return or other schedule relating to such Taxes shall
    be kept confidential by the Parties hereto.

    

 c. Any refund of Taxes paid or payable with respect to Taxes referred to in
    this Section 6.6 shall be promptly paid as follows (or to the extent payable
    but not paid due to offset against other Taxes shall be promptly paid by the
    Party receiving the benefit of the offset as follows): (i) to Seller if
    attributable to such Taxes with respect to any Tax year or portion thereof
    ending on or before the Closing Date (or for any Tax year beginning before
    and ending after the Closing Date to the extent allocable to the portion of
    such period beginning before and ending on the Closing Date); and (ii) to
    Purchaser if attributable to such Taxes with respect to any Tax year or
    portion thereof beginning after the Closing Date (or for any Tax year
    beginning before and ending after the Closing Date to the extent allocable
    to the portion of such period ending after the Closing Date).

    

 d. In the event that a Dispute arises between Seller and Purchaser as to
    proration of any Taxes referred to in this Section 6.6, the Parties shall
    attempt in good faith to resolve such Dispute, and any amount so agreed upon
    shall be paid to the appropriate Party.

Section 6.7    Monthly Operating Reports. Seller shall prepare the Monthly
Operating Reports as of the last day of each calendar month consistent with
Seller's current practices, and Seller shall deliver the Monthly Operating
Report for each calendar month to Purchaser on or about fifteen (15) days
following the last day of each calendar month.

Section 6.8    Risk of Loss.

 a. From the date hereof through the Closing, all risk of loss or damage to the
    assets and properties included in the Purchased Assets shall be borne by
    Seller.

    

    If, before the Closing, all or any portion of the combined Purchased Assets
    and Transmission Assets is damaged or destroyed (the "Damaged Portion")
    (whether by fire, theft, vandalism or other casualty) in whole or in part,
    Seller shall notify Purchaser and Transmission Assets Purchaser promptly in
    writing of such fact, and:

    For the purposes of this Section 6.8, the estimated costs of any repair or
    restoration of any Damaged Portion (the "Estimated Cost") and the amount of
    time required for such repair or restoration shall be determined by a
    qualified professional consultant selected by Seller but reasonably
    acceptable to Purchaser and, if the Damaged Portion includes the
    Transmission Assets, the Transmission Assets Purchaser, and each making such
    determination shall timely agree upon and jointly engage such consultant
    with the costs thereof being borne equally by those making the engagement.
    
    If the Damaged Portion could reasonably be expected to be fully repaired or
    restored, in accordance with Good Utility Practices, for an Estimated Cost
    not exceeding $5,000,000, then Seller shall bear the costs of and
    responsibility for fully repairing or restoring the Damaged Portion and
    shall promptly commence, diligently pursue and complete such repair or
    restoration as soon as reasonably practical, subject to paragraph (c) below.
    
    If the Damaged Portion could reasonably be expected to be fully repaired or
    restored, in accordance with Good Utility Practices, for an Estimated Cost
    equal to or greater than $5,000,000, but less than $25,000,000, then either
    (x) within thirty (30) days of the damage or destruction, Purchaser may by
    written notice to Seller and Transmission Assets Purchaser terminate this
    Agreement (with the resulting termination of the Transmission Assets
    Purchase and Sale Agreement under Section 10.1(e) thereof) without either
    Party receiving damages with respect to such termination under this
    paragraph (but the right to terminate under this paragraph shall not limit
    either Party's rights to terminate under other provisions of this Agreement)
    or (y) if Purchaser does not terminate within such period then Seller shall
    bear the costs of and responsibility for fully repairing or restoring the
    Damaged Portion and shall promptly commence, diligently pursue and complete
    such repair or restoration as soon as reasonably practical, subject to
    paragraph (c) below.
    
    If the Damaged Portion could reasonably be expected to be fully repaired or
    restored, in accordance with Good Utility Practices for an Estimated Cost
    equal to or greater than $25,000,000, then within sixty (60) days of the
    damage or destruction, either Party may by written notice to the other and
    the Transmission Assets Purchaser terminate this Agreement (with the
    resulting termination of the Transmission Assets Purchase and Sale Agreement
    under Section 10.1(e) thereof), and if Seller terminates under this
    paragraph, the Liquidated Damages for Cost and Expenses shall become due and
    payable in accordance with Section 10.3, but Seller's payment of such amount
    shall be limited to an amount equal to the lesser of half of all insurance
    proceeds in excess of the Purchase Price or the full amount of Liquidated
    Damages for Costs and Expenses, and otherwise without either Party receiving
    damages with respect to such termination under this paragraph (but the right
    to terminate under this paragraph shall not limit either Party's rights to
    terminate under other provisions of this Agreement). If neither Party
    terminates within such period then Seller shall bear the costs of and
    responsibility for fully repairing or restoring the Damaged Portion and
    shall promptly commence, diligently pursue and complete such repair or
    restoration as soon as reasonably practical, subject to paragraph (c) below.

    In the event Seller is responsible for repairing or restoring in accordance
    with any of the foregoing, then before commencing such repairs or
    restoration the following shall be determined: (i) if such repairs or
    restoration could reasonably be expected to be fully completed, in
    accordance with Good Utility Practices, on or before the earlier of the
    Expiration Date or twelve (12) months after the date of the damage or
    destruction (for the purposes of this Section 6.8, the earlier of such dates
    being the "Limit Date"), then such repairs or restoration shall be completed
    on or before the Limit Date and the Closing shall be delayed for such
    reasonable time as is necessary to accomplish the same, but in no event
    later than the Limit Date, or (ii) if such repairs or restoration could not
    reasonably be expected to be fully completed, in accordance with Good
    Utility Practices, on or before the Limit Date, then at Purchaser's election
    (A) Purchaser, Transmission Assets Purchaser and Seller shall agree to
    extend the Limit Date to the extent necessary to complete such repairs or
    restoration (for the purposes of this Section 6.8, the "Extended Limit
    Date"), including to the extent necessary by extension of the Expiration
    Date and the "Limit Date" and the "Expiration Date" under the Transmission
    Assets Purchase and Sale Agreement (and with respect to Purchaser and
    Seller, to the extent that the Expiration Date is extended, the extension of
    the expiration date under the Tolling Agreement), in which case the agreed
    upon extensions shall become effective and such repairs shall be completed
    on or before the Extended Limit Date and the Closing shall be delayed for
    such reasonable time as is necessary to accomplish the same, but in no event
    later than the Extended Limit Date, or (B) subject to the approval of
    Transmission Assets Purchaser if the Damaged Portion includes the
    Transmission Assets, Purchaser and Transmission Assets Purchaser shall, to
    the extent the Purchased Assets or Transmission Assets, respectively, are
    affected, severally accept responsibility for such repairs or restoration,
    the Purchase Price and the "Purchase Price" under the Transmission Assets
    Purchase and Sale Agreement, respectively, shall be proportionately reduced
    by the Estimated Cost of such repairs or restoration to the respective
    affected assets, Purchaser and Transmission Assets Purchaser shall waive
    conditions precedent regarding the completion of such repairs and
    restoration by Seller and, if Purchaser so requests, Seller shall allow
    Purchaser and Transmission Assets Purchaser to begin such repairs or
    restoration prior to Closing subject to appropriate indemnification. In the
    event that clause (B) above applies and the actual cost of such repairs or
    restoration are less than or are more than the Estimated Cost, Seller and
    Purchaser agree that neither party shall have the right to make a claim
    against the other party for such differential, it being understood that a
    claim for such differential shall not constitute a Purchaser Claim or a
    Seller Claim hereunder.

    In the event Seller is responsible for repairing or restoring in accordance
    with any of the foregoing, Purchaser shall receive a day for day extension
    for the dates on which there would otherwise be an increase in the Initial
    Purchase Price equal to the number of days from the date of the damage or
    destruction until the date the repair or restoration is complete less the
    number of days during such period where the conditions set forth in Section
    8.4(a) and (b) have not been fulfilled or waived. In addition, Seller shall
    use Commercially Reasonable Efforts to (i) cooperate with Purchaser and if
    the Damaged Portion includes the Transmission Assets, Transmission Assets
    Purchaser, (ii) include Purchaser and if the Damaged Portion includes the
    Transmission Assets, Transmission Assets Purchaser, in meetings and
    communications relating to such repair or restoration in order to enable
    Purchaser and Transmission Assets Purchaser to evaluate the quality and
    sufficiency thereof, and (iii) complete such full repair or restoration on
    or before the Limit Date or the Extended Limit Date, as the case may be. If
    the Estimated Cost of such repair or restoration of the Damaged Portion
    exceeds $1,500,000, Seller will not grant its final acceptance of any such
    repair or restoration without Purchaser's prior written consent and, to the
    extent the Damaged Portion includes Transmission Assets, Transmission Assets
    Purchaser's prior written consent, in each case not to be unreasonably
    withheld or delayed.

Section 6.9    Insurance. Purchaser acknowledges and agrees that, effective upon
the Closing, the Project Insurance Policies shall be terminated or modified to
exclude coverage of the Purchased Assets by Seller for the period after the
Closing, and, as a result, Purchaser shall be obligated at or before the Closing
to obtain at its sole cost and expense replacement insurance. Purchaser further
acknowledges and agrees that Purchaser may need to provide to certain
Governmental Authorities and third parties evidence of such replacement or
substitute insurance coverage for the continued operation of the Purchased
Assets following the Closing. Notwithstanding Section 2.2(g), in the event that
the Closing shall actually have occurred on the Closing Date and the full amount
of the Purchase Price has been paid by Purchaser to Seller, if any claims are
made or Losses are incurred arising from events that occur after the Effective
Date and prior to the Closing Date and that relate solely to the Purchased
Assets and such claims, or the claims associated with such losses, may be made
against the policies maintained by Seller prior to the Closing or under policies
otherwise retained by Seller after the Closing, then Seller shall use its
Commercially Reasonable Efforts (without incurring any additional costs or
expenses) so that Purchaser can through Seller file, notice and otherwise
continue to pursue such claims and recover proceeds under the terms of such
policies. Purchaser shall inform Seller of any such claims no later than ninety
(90) days after the Closing Date. If requested by Seller, Purchaser shall use
its Commercially Reasonable Efforts to assist Seller, at Seller's cost, in
obtaining so-called "tail" coverage in respect of claims brought after the
Closing for events occurring prior to the Closing.

Section 6.10    Post Closing - Further Assurances. At any time or from time to
time after the Closing, each Party will, upon the reasonable request of the
other Party, execute and deliver any further instruments or documents, and
exercise Commercially Reasonable Efforts to take such further actions as may
reasonably be required, to fulfill and implement the terms of this Agreement or
realize the benefits intended to be afforded hereby. After the Closing, and upon
prior reasonable request, each Party shall exercise Commercially Reasonable
Efforts to cooperate with the other, at the requesting Party's expense (but
including only out-of-pocket expenses to third parties and not the costs
incurred by any Party for the wages or other benefits paid or payable to its
officers, directors or employees in furnishing assistance), in furnishing
non-privileged records, information, testimony and other assistance in
connection with any inquiries, actions, audits, proceedings or dispute involving
the Purchased Assets or any of the Parties hereto (other than in connection with
Disputes between the Parties hereto) and based upon contracts, arrangements or
acts of Seller or Purchaser, which were in effect or occurred on, prior to, or
after Closing and which relate to the Purchased Assets, including, without
limitation, arranging discussions with (and calling as a witness) officers,
directors, employees, agents and representatives of Purchaser or Seller.

Section 6.11    Information and Records.
 a. Prior to the Closing, Seller will provide or cause to be provided to
    Purchaser and its agents, upon reasonable notice, (i) reasonable access to
    all books, records, documents or information reasonably relating to the
    Project, the Purchased Assets or the Business; and (ii) such access to the
    Project, the Purchased Assets or the Business and Dave Patton or his
    successor, the Project plant manager, and, with Dave Patton's or his
    successor's oral or written consent, which consent shall not be unreasonably
    withheld, the Project operations manager, environmental, accounting, human
    resources and information technology representatives and other
    representatives and employees of Seller and its Independent Contractors
    reasonably requested by Purchaser, in each case during normal business hours
    and at Purchaser's sole cost, risk and expense, as Purchaser may request for
    any reasonable purpose. Purchaser agrees that Purchaser will not disclose
    any Confidential Information (as defined in the Confidentiality Agreement)
    relating to Seller, whether obtained pursuant to this Section or otherwise,
    to any party unless such disclosure is otherwise permitted by the
    Confidentiality Agreement.

    

    Prior to the execution of this Agreement, Seller has provided Purchaser with
    access to the Project and the Project Site and to information and personnel
    sufficient to allow Purchaser to assess and determine to its reasonable
    satisfaction the presence, scope and extent of any Environmental Conditions
    at the Project and the Project Site. Seller has provided Purchaser with
    information pursuant to requests directed to Seller or directed to any
    Governmental Authority with jurisdiction over the Project or the Project
    Site as well as access to the Project and Project Site. This right of access
    has included without limitation any requests for information directed to
    Seller or to any Governmental Authority with jurisdiction over the Project
    or the Project Site, as well as access to the Project Site by the
    Environmental Consultant for the purpose of performing investigations or
    assessments necessary or appropriate in Purchaser's reasonable discretion to
    assess the foregoing, including without limitation the status of any
    Environmental Condition or any Release of Hazardous Substances. As a result
    of this investigation, the Environmental Consultant has prepared an initial
    Environmental Assessment dated September 22, 2004. The initial Environmental
    Assessment concludes that there are no Environmental Conditions; that the
    Environmental Consultant has not found any major issues in the area of
    environmental compliance for the Project or Project Site and that Seller
    appears to be in compliance with respect to environmental matters. As set
    forth in Section 6.16(a)-(d), in its discretion, Purchaser may elect to
    conduct a final Environmental Assessment.

    From the date hereof, Seller shall continue to provide Purchaser with access
    to information and personnel sufficient to allow Purchaser to assess and
    determine to its reasonable satisfaction the presence, scope and extent of
    any Environmental Conditions at the Project Site, the accuracy of Seller's
    representations and warranties in Section 4.16, the status of any
    Remediation and other related matters. This right of access shall include
    without limitation any requests for information directed to Seller or to any
    Governmental Authority with jurisdiction over the Project or the Project
    Site, as well as access to the Project Site by the Environmental Consultant
    or any qualified professional consultant selected by Purchaser for the
    purpose of performing investigations or assessments necessary or appropriate
    in Purchaser's reasonable discretion to assess the foregoing, including
    without limitation the status of any Remediation or response to any Release
    of Hazardous Substances. Seller hereby consents, for the purpose of this
    Section and otherwise, to any such investigation, including for the purpose
    of the preparation of the final Environmental Assessment.

Section 6.12    Project Employee Matters.

 a. Purchaser has no obligation to employ or retain any Project Employees or to
    assume any employment agreements or other agreements related thereto and
    shall have no obligations or liability thereunder. Seller shall not make any
    written or verbal agreement, representation or statement to current, former
    or future Project Employees prior to the Closing about the possibility of
    employment or retention on the Project with Purchaser or any of its
    Affiliates that is inconsistent with the provisions of this Section 6.12.

    

    Subject to the restrictions of paragraph (c) below, Purchaser may, in
    Purchaser's sole discretion, but upon the approval of Seller which shall not
    be unreasonably withheld based on the estimated timing of Closing and
    potential interference with operation of the Project both before and after
    Closing, communicate with any current, former or future Project Employees
    prior to the Closing about the possibility of employment with Purchaser and,
    in Purchaser's sole discretion, elect to offer employment to any such
    Project Employees that would not commence earlier than the Closing and on
    such other terms and conditions as Purchaser shall determine. Seller shall
    use Commercially Reasonable Efforts to cause NAES to enter into with respect
    to the Project Employees of NAES listed in Schedule 6.12 (for the purposes
    of this Section 6.12, the "Designated NAES Employees") releases in favor of
    Purchaser from applicable confidentiality, non-competition and like
    agreements and other reasonable agreements consenting to and agreeing to
    cooperate with the rights of Purchaser under this Section 6.12.

    Notwithstanding Purchaser's rights under paragraph (b) above, Purchaser
    shall not make any offer to employ any of Designated NAES Employees to work
    for Purchaser on the Project unless and until the Closing takes place, and
    shall not otherwise make any offer to employ any Designated NAES Employees
    at other locations unless such employment occurs as a result of any such
    Project Employees contacting Purchaser for employment related to matters
    other than the Project prior to any discussion by Purchaser with such
    Project Employees of opportunities related to the Project.

Section 6.13    Emission Allowances Adjustment. Notwithstanding anything to the
contrary herein, Purchaser and Seller shall use Commercially Reasonable Efforts,
including executing any required forms or providing appropriate notices to
Governmental Authorities, in a timely fashion, to ensure that Purchaser will
obtain all, or the rights to all, Emission Allowances that are to be transferred
to it pursuant to Section 2.1(k) hereof, including the right to receive such
Emission Allowances that are to be allocated or issued by a Governmental
Authority in the future. Purchaser and Seller further acknowledge and agree that
such actions may be required before, on or after the Closing Date.

Section 6.14    Additional Covenants of Seller. Seller hereby agrees with and
covenants to Purchaser that Seller shall cooperate with Purchaser in assessing
the Purchased Assets and their operating characteristics in the interest of
facilitating an orderly transition of the management of the Purchased Assets on
the Closing Date.

Section 6.15    No Solicitation. From the date of the Letter of Intent, Seller
has not and will not directly or indirectly (a) solicit, initiate, seek, respond
to or take any other action to encourage inquiry or submission or proposals of
offers, or accept any offers, or enter into a confidentiality agreement, letter
of intent or purchase agreement or other similar agreement with any Person other
than Purchaser (or Transmission Purchaser, as contemplated by the Transmission
Purchase Agreements), with respect to the acquisition of some or all of the
Project, including the Purchased Assets and the Transmission Assets, or a
merger, consolidation, business combination, sale of all or any material portion
of the securities of Seller or any similar extraordinary transaction with
respect to Seller (an "Acquisition Proposal") or (b) participate in any
discussions or negotiations regarding, or furnish to any Person other than
Purchaser (or Transmission Purchaser, as contemplated by the Transmission
Purchase Agreements) any information with respect to, or otherwise cooperate in
any way with or assist, facilitate or encourage any Acquisition Proposal by any
Person other than Purchaser (or Transmission Purchaser, as contemplated by the
Transmission Purchase Agreements).

Section 6.16    Environmental Matters.

    (a)    As set forth in Section 6.11(b) the initial Environmental Assessment
obtained by Purchaser reflects that neither the Project nor the Project Site
was, at the time of the Assessment, subject to any Environmental Condition or
any violation of Environmental Law. If in its discretion Purchaser elects to
conduct a final Environmental Assessment, the same shall be completed not later
than sixty (60) days in advance of the Closing Date. If the final Environmental
Assessment discloses that the Project or the Project Site is subject to an
Environmental Condition, then Purchaser shall notify Seller and Transmission
Assets Purchaser promptly in writing not later than forty-five (45) days prior
to the Closing Date identifying any such Environmental Condition and furnishing
a copy of said final Environmental Assessment. If, before the Closing, an
Environmental Condition is discovered in a manner other than through the final
Environmental Assessment, the discovering party shall notify the other Party and
the Transmission Assets Purchaser promptly in writing of such fact. Upon
notification of such Environmental Condition through the final Environmental
Assessment or otherwise, the following steps shall occur:

For the purposes of this Section 6.16, the estimated costs of any Remediation of
an Environmental Condition (the "Estimated Cost") and the amount of time
required for such Remediation shall be determined by a qualified professional
consultant selected by Seller but reasonably acceptable to Purchaser and, if the
Environmental Condition affects the Transmission Assets, the Transmission Assets
Purchaser, and each making such determination shall timely agree upon and
jointly engage such consultant with the costs thereof being borne equally by
those making the engagement;

If the Estimated Cost does not exceed $2,000,000, then Seller shall bear the
costs of and responsibility for completing such Remediation and shall promptly
commence, diligently pursue and complete such Remediation as soon as reasonably
practical, subject to (y) the requirements of the Remediation Plan or any
applicable Governmental Authority described in paragraph (b) below or (z)
paragraph (d) below; and

If the Estimated Cost exceeds $2,000,000, then either (x) within thirty (30)
days after receipt of the Estimated Cost, either Party may, by written notice to
the other and the Transmission Assets Purchaser, terminate this Agreement (with
the resulting termination of the Transmission Assets Purchase and Sale Agreement
under Section 10.1(e) thereof), and for such termination no Liquidated Damages
for Costs and Expenses shall be due if the Environmental Condition was caused by
the acts of Purchaser or Transmission Assets Purchaser or the acts of third
parties beyond the reasonable control of Seller, and otherwise the Liquidated
Damages for Costs and Expenses shall become immediately due and payable by
Seller in accordance with Section 10.3 (but the right to terminate under this
paragraph shall not limit either Party's rights to terminate under other
provisions of this Agreement) or (y), if neither Party terminates within such
period, then Seller shall bear the costs of and responsibility for completing
the Remediation and shall promptly commence, diligently pursue and complete such
Remediation as soon as reasonably practical, subject to (y) the requirements of
the Remediation Plan or any applicable Governmental Authority described in
paragraph (b) below or (z) paragraph (d) below.

    (b)     With respect to any such Remediation, Seller shall comply with the
requirements of the relevant Governmental Authorities to address any such
Environmental Condition so identified with the purpose of obtaining a "no
further action" determination or a similar finding by such Governmental
Authorities. Seller shall identify itself as the sole party responsible for
compliance with the terms and conditions of the Remediation. For the purposes of
subparagraphs (a)(ii) and (iii) above and paragraph (d) below, completion of the
Remediation shall not have occurred until Seller has received such determination
or finding.

     (c)     Seller will provide Purchaser and, if the Transmission Assets are
affected by the applicable Environmental Condition, Transmission Assets
Purchaser, with a copy of the draft Remediation Plan concerning any remediation
to be conducted pursuant to this Section 6.16. Seller will obtain Purchaser's
approval and, if the Transmission Assets are affected by the applicable
Environmental Condition, Transmission Assets Purchaser's approval, of the
Remediation Plan, not to be unreasonably withheld or delayed, prior to beginning
remediation activities: (i) if the plan will result in a material modification
of the operation of the Purchased Assets or the Transmission Assets or a
material modification of the Purchased Assets or the Transmission Assets; (ii)
if new and different monitoring of the Purchased Assets or the Transmission
Assets is required by the Governmental Authorities; or (iii) if issuance of an
Environmental Permit not reflected on the Schedules to this Agreement or to the
Transmission Assets Purchase and Sale Agreement is required. Otherwise, Seller
shall provide Purchaser and, if the Transmission Assets are affected by the
applicable Environmental Condition, Transmission Assets Purchaser, with an
opportunity to review and comment on the Remediation Plan.

    (d)     In the event Seller is responsible for Remediation in accordance
with any of the foregoing, then before commencing such Remediation the following
shall be determined: (i) if such Remediation could reasonably be expected to be
fully completed on or before the earlier of the Expiration Date or twelve (12)
months after the receipt of the Estimated Cost (for the purposes of this Section
6.16, the earlier of such dates being the "Limit Date"), then such Remediation
shall be completed on or before the Limit Date and the Closing shall be delayed
for such reasonable time as is necessary to accomplish the same, but in no event
later than the Limit Date, or (ii) if such Remediation could not reasonably be
expected to be fully completed on or before the Limit Date, then at Purchaser's
election (A) Purchaser, Transmission Assets Purchaser and Seller shall agree to
extend the Limit Date to the extent necessary to complete such Remediation (for
the purposes of this Section 6.16, the "Extended Limit Date"), including to the
extent necessary by extension of the Expiration Date and the "Expiration Date"
and the "Limit Date" under the Transmission Assets Purchase and Sale Agreement
(and with respect to Purchaser and Seller, in the event that the Expiration Date
is extended, the extension of the expiration date under the Tolling Agreement),
in which case the agreed upon extensions shall become effective and such repairs
shall be completed on or before the Extended Limit Date and the Closing shall be
delayed for such reasonable time as is necessary to accomplish the same, but in
no event later than the Extended Limit Date, or (B) subject to the approval of
Transmission Assets Purchaser if the Transmission Assets are affected by the
applicable Environmental Condition, Purchaser and Transmission Assets Purchaser
shall, to the extent the Purchased Assets or Transmission Assets, respectively,
are affected severally, accept responsibility for such Remediation, the Purchase
Price and the "Purchase Price" under the Transmission Assets Purchase and Sale
Agreement, respectively, shall be proportionately reduced by the Estimated Cost
of such Remediation to the respective affected assets, Purchaser and
Transmission Assets Purchaser shall waive conditions precedent regarding the
completion of such Remediation by Seller (and paragraphs (b) and (c) above) and,
if Purchaser so requests, Seller shall allow Purchaser and Transmission Assets
Purchaser to begin such Remediation prior to Closing subject to appropriate
indemnification. In the event that clause (B) above applies and the actual cost
of such Remediation is less than or is more than the Estimated Cost, Seller and
Purchaser agree that neither party shall have the right to make a claim against
the other party for such differential, it being understood that a claim for such
differential shall not constitute a Purchaser Claim or a Seller Claim hereunder

    (e)     In the event that the conditions to Closing contained in Section
8.4(a) and (b) have been fulfilled or waived, Purchaser shall receive a day for
day extension for the dates on which there would otherwise be an increase in the
Initial Purchase Price equal to the number of days from the date of the notice
of the Environmental Condition by Purchaser until the date the Remediation is
complete.

ARTICLE 7

INDEMNIFICATION

Section 7.1    Indemnification by Seller.
 a. Purchaser Claims. Seller will indemnify, defend and hold harmless Purchaser,
    its Affiliates and each of their officers, directors, employees, attorneys,
    agents and successors and assigns (collectively, the "Purchaser Group"),
    from and against any and all demands, suits, penalties, obligations,
    damages, claims, losses, liabilities, payments, costs and expenses
    ("Losses"), including reasonable legal, accounting and other expenses in
    connection therewith and costs and expenses incurred in connection with
    investigations and settlement proceedings, which arise out of, are in
    connection with or relate to, the following (collectively, "Purchaser
    Claims"), in each case, even if such Losses are caused by the sole, joint or
    concurrent negligence, strict liability or other fault of any person
    included in the Purchaser Group or any other Person:

    

    any breach or violation of any covenant, obligation or agreement of Seller
    set forth in this Agreement or the Ancillary Agreements;
    
    any breach or inaccuracy of the representations or warranties made by Seller
    in this Agreement or the Ancillary Agreements, whether such representation
    or warranty is made as of the Effective Date or the Closing Date or in any
    certificate to be delivered by Seller pursuant hereto; provided that for
    purposes of determining the amount of Losses sustained or incurred thereby,
    for purposes of this Section 7.1(a) only, such representations and
    warranties shall be interpreted without giving effect to the words
    "material", "materially", "Material Adverse Effect", or words of similar
    effect; provided, further that no indemnity is provided with respect to the
    second sentence of Section 4.18;
    
    Seller's ownership, operation or use of any of the Excluded Assets;
    
    the Excluded Liabilities;
    
    any Third Party Claim relating to, in connection with or arising out of the
    ownership, operation or use of any of the Purchased Assets, to the extent
    relating to any period of time on or prior to the Closing Date; or
    
    any other matter relating to the Business or the Purchased Assets, to the
    extent relating to any period of time on or prior to the Closing Date, or
    relating to any Excluded Asset or Excluded Liability.

    Seller Limitations

    . Subject to paragraph (v) below:

    

    The Purchaser Group shall not be entitled to any punitive, incidental,
    indirect, special or consequential damages included in any Purchaser Claim
    or otherwise resulting from, in connection with or arising out of this
    Agreement or the Ancillary Agreements, including such damages for lost
    revenues, income or profits, diminution in value of the Project or for any
    other damage or loss resulting from the disruption to or loss of operation
    of the Project; provided that this limitation shall not apply to any
    Purchaser Claim for indemnification from any punitive, incidental, indirect,
    special or consequential damages awarded against Purchaser as a result of a
    Third Party Claim.
    
    The Purchaser Group shall not be entitled to any damages in connection with
    the termination of this Agreement by Purchaser pursuant to Section 10.1(c),
    unless at the time of the termination (y) Seller could not or would not
    deliver to Purchaser title to the Purchased Assets meeting the requirements
    set forth in Sections 4.10, 4.11, 4.12 and 4.14 or (z) the condition or the
    functionality of the Purchased Assets does not meet the requirements set
    forth in Sections 4.13 and 4.26 or is materially and adversely different
    from the condition or functionality of the Purchased Assets which exists as
    of the Effective Date.
    
    The aggregate damages to which the Purchaser Group shall be entitled under
    Section 7.1(a) shall be limited to (A) $23,182,676.00 less any Liquidated
    Damages for Costs and Expenses paid by Seller, with respect to Purchaser
    Claims asserted before the Closing, (B) $9,273,070.40, with respect to
    Purchaser Claims asserted after the Closing through the day before the date
    that is six months after the Closing Date, (C) $4,636,535.20, with respect
    to Purchaser Claims asserted on and after the date that is six months after
    the Closing Date through the date that is one year after the Closing Date
    and (D) $0 with respect to Purchaser Claims asserted thereafter.
    
    The Purchaser Group shall not be entitled to indemnification under Section
    7.1(a) for Purchaser Claims for Purchaser General Costs and Expenses for
    which Liquidated Damages for Costs and Expenses are paid by Seller pursuant
    to Section 10.3.
    
    Notwithstanding the foregoing, (A) the limitations in paragraph (i) shall
    not apply to any claim for Liquidated Damages for Costs and Expenses; (B)
    the limitations in paragraph (ii) above shall not apply to Purchaser Claims
    following a termination for or in connection with a breach of Section 6.15
    or to any claim for Liquidated Damages for Costs and Expenses and (C) the
    limitations in paragraph (iii) shall not apply to Purchaser Claims resulting
    from, in connection with or arising out of any fraudulent act or intentional
    breach by Seller.

Section 7.2    Indemnification by Purchaser.

 a. Seller Claims. From and after the Closing Date, Purchaser shall indemnify,
    defend and hold harmless the Seller Group from and against any and all
    Losses which arise out of or relate to the following (collectively, "Seller
    Claims"), in each case, even if such Losses are caused by the sole, joint or
    concurrent negligence, strict liability or other fault of any person
    included in the Seller Group or any other Person:

    any breach or violation of any covenant, obligation or agreement of
    Purchaser set forth in this Agreement or the Ancillary Agreements;
    
    any breach or inaccuracy of any of the representations or warranties made by
    Purchaser in this Agreement or the Ancillary Agreements, whether such
    representation or warranty is made as of the Effective Date or the Closing
    Date or in any certificate to be delivered by Purchaser pursuant hereto;
    provided, that for purposes of determining the amount of Losses sustained or
    incurred thereby, for purposes of this Section 7.2(a), such representations
    and warranties shall be interpreted without giving effect to the words
    "material", "materially", "Material Adverse Effect", or words of similar
    effect;
    
    the failure of Purchaser to pay, perform or discharge any of the Assumed
    Liabilities as and when due;
    
    any Third Party Claim relating to or arising out of the ownership, operation
    or use of any of the Purchased Assets (but excluding the Excluded Assets and
    the Excluded Liabilities), to the extent relating to any period of time
    after the Closing Date;
    
    any personal injury or physical property damage to the Purchased Assets, the
    Transmission Assets or other property arising out of the acts or omissions
    of any officer, director, employee, agent or representative of Purchaser or
    of any consultant selected by Purchaser in the performance of the activities
    described in Section 6.11(c); or
    
    any other matter relating to the business of Purchaser or the Purchased
    Assets (but excluding the Excluded Assets and the Excluded Liabilities), to
    the extent arising during and relating solely to any period of time after
    the Closing Date, or any Assumed Liability.

    

 b. Purchaser Limitations.

        The Seller Group shall not be entitled to any punitive, incidental,
        indirect, special or consequential damages included in any Seller Claim
        or otherwise resulting from, in connection with or arising out of this
        Agreement or the Ancillary Agreements, including such damages for lost
        revenues, income or profits, diminution in value of the Project or for
        any other damage or loss resulting from the disruption to or loss of
        operation of the Project; provided that this limitation shall not apply
        to any Seller Claim for indemnification from any punitive, incidental,
        indirect, special or consequential damages awarded against Seller as a
        result of a Third Party Claim.
    
     i. The aggregate damages to which the Seller Group shall be entitled under
        Section 7.2(a) shall be limited to (A) $23,182,676.00, with respect to
        Seller Claims asserted before the Closing, (B) $9,273,070.40, with
        respect to Seller Claims asserted after the Closing through the day
        before the date that is six months after the Closing Date, (C)
        $4,636,535.20, with respect to Seller Claims asserted on and after the
        date that is six months after the Closing Date through the date that is
        one year after the Closing Date and (D) $0 with respect to Seller Claims
        asserted thereafter.
    
        Notwithstanding the foregoing, the limitations in paragraph (ii) above
        shall not apply with respect to Seller Claims resulting from, in
        connection with or arising out of any fraudulent act or intentional
        breach by Purchaser.

Section 7.3    Notice of Claim. Subject to the terms of this Agreement and upon
receipt of notice of the assertion of a claim or of the commencement of any
suit, action or proceeding that is a Third Party Claim against any member of the
Purchaser Group or the Seller Group entitled to indemnification under Section
7.1, or Section 7.2, respectively, such Person entitled to indemnification
hereunder (the "Indemnitee") will promptly notify the Party against whom
indemnification is sought (the "Indemnitor") in writing of any damage, claim,
loss, liability or expense which the Indemnitee has determined has given or
could give rise to a claim under Section 7.1 or Section 7.2. Such written notice
is herein referred to as a "Notice of Claim." A Notice of Claim will specify, in
reasonable detail, the facts known to the Indemnitee regarding the claim.
Subject to the terms of this Agreement, the failure to provide (or timely
provide) a Notice of Claim will not affect the Indemnitee's rights to
indemnification; provided, however, the Indemnitor is not obligated to indemnify
the Indemnitee for the increased amount of any claim which would otherwise have
been payable to the extent that the increase resulted from the failure to
deliver timely a Notice of Claim.

Section 7.4    Defense of Third Party Claims. The Indemnitor shall defend, in
good faith and at its expense, any claim or demand set forth in a Notice of
Claim relating to a Third Party Claim and the Indemnitee, at its expense, may
participate in the defense. The Indemnitee may not settle or compromise any
Third Party Claim so long as the Indemnitor is defending it in good faith. If
the Indemnitor elects not to contest a Third Party Claim, the Indemnitee may
undertake its defense, and the Indemnitor will be bound by the result obtained
by the Indemnitee. The Indemnitor may at any time request the Indemnitee to
agree to the abandonment of the contest of the Third Party Claim or to the
payment or compromise by the Indemnitor of the asserted claim or demand. If the
Indemnitee does not object in writing within fifteen (15) days of the
Indemnitor's request, the Indemnitor may proceed with the action stated in the
request. If, within that fifteen (15) day period, the Indemnitee notifies the
Indemnitor in writing that it has determined that the contest should be
continued, the Indemnitor shall be liable under this Article 7 only for an
amount up to the amount which the Indemnitor had proposed be accepted in payment
or compromise. This Section 7.4 is subject to the rights of any insurance
carrier of Indemnitee that is defending the Third Party Claim.

Section 7.5    Cooperation. The Party defending the Third Party Claim shall (a)
consult with the other Party throughout the pendency of the Third Party Claim
regarding the investigation, defense, settlement, trial, appeal or other
resolution of the Third Party Claim and (b) afford the other Party the
opportunity to be associated in the defense of the Third Party Claim. The
Parties shall cooperate in the defense of the Third Party Claim. The Indemnitee
shall make available to the Indemnitor or its representatives all records and
other materials reasonably required by them for use in contesting any Third
Party Claim (subject to obtaining an agreement to maintain the confidentiality
of confidential or proprietary materials in a form reasonably acceptable to
Indemnitor and Indemnitee). If requested by the Indemnitor, the Indemnitee shall
cooperate with the Indemnitor and its counsel in contesting any Third Party
Claim that the Indemnitor elects to contest or, if appropriate, in making any
counterclaim against the Person asserting the claim or demand, or any
cross-complaint against any Person. The Indemnitor shall reimburse the
Indemnitee for any expenses incurred by Indemnitee in cooperating with or acting
at the request of the Indemnitor.

Section 7.6    Minimum Claim. No Party shall have any liability or obligation to
indemnify under Section 7.1(a)(ii) or Section 7.2(a)(ii), unless and until the
aggregate amount for which such Party would be liable thereunder, but for this
provision, exceeds Five Hundred Thousand Dollars ($500,000), in which event
recovery by the Indemnified Parties shall include the full aggregate amount of
such liability, including such amounts as do not exceed such threshold amount.
Nothing in this Section 7.6 is intended to modify or limit a Party's liability
or obligation hereunder for other indemnifiable Claims.

Section 7.7    Purchase Price Adjustment. Any and all payments required to be
made under this Article 7 shall be treated by all Parties as an adjustment to
the Purchase Price.

Section 7.8    Specific Performance. Seller acknowledges that the Purchaser
Transactions are unique and that Purchaser will be irreparably injured should
such Transactions not be consummated in a timely fashion. Consequently,
Purchaser will not have an adequate remedy at law if Seller shall fail to sell
the Purchased Assets when required to do so hereunder. In such event, Purchaser
shall have the right, in addition to any other remedy available in equity or
law, to specific performance of such obligation by Seller, subject to
Purchaser's performance of its obligations hereunder. Purchaser acknowledges
that the Purchaser Transactions are unique and that Seller will be irreparably
injured should such Transactions not be consummated in a timely fashion.
Consequently, Seller will not have an adequate remedy at law if Purchaser shall
fail to purchase the Purchased Assets when required to do so hereunder. In such
event, Seller shall have the right, in addition to any other remedy available in
equity or law, to specific performance of such obligation by Purchaser, subject
to Seller's performance of its obligations hereunder.

Section 7.9    Exclusivity. Except as provided in Section 7.8 and Section 10.3,
and except in the case of any fraudulent act or intentional breach, the rights
and remedies of Seller and members of the Seller Group, on the one hand, and
Purchaser and members of the Purchaser Group, on the other hand, for money
damages under this Article are, solely as between Seller and the Seller Group on
the one hand, and Purchaser and the Purchaser Group on the other hand, exclusive
and in lieu of any and all other rights and remedies for money damages which
each of Seller and members of the Seller Group on the one hand, and Purchaser
and members of the Purchaser Group on the other hand, may have under this
Agreement or the Ancillary Agreements or under applicable Law with respect to
any indemnifiable Claim, whether at common law or in equity.

ARTICLE 8

PURCHASER'S CONDITIONS TO CLOSING

The obligation of Purchaser to consummate the Transactions hereunder shall be
subject to fulfillment at or prior to the Closing of the following conditions,
except to the extent Purchaser waives such fulfillment in writing:

Section 8.1    Compliance with Provisions. Seller shall have performed or
complied in all material respects with all covenants, obligations and agreements
contained in this Agreement and the Ancillary Agreements on its part required to
be performed or complied with at or prior to the Closing.

Section 8.2    HSR Act. The waiting period under the HSR Act applicable to the
consummation of the sale of the Purchased Assets contemplated hereby shall have
expired or been terminated.

Section 8.3    No Restraint. There shall be no:
 a. Preliminary or permanent Order which prevents the consummation of the
    Transactions as herein provided; or

    

 b. Action taken, or Law enacted, promulgated or deemed applicable to the
    Transactions, by any Governmental Authority which prohibits the consummation
    of the Transactions as herein provided.

    

Section 8.4    Required Regulatory Approvals and Consents.
 a. All of Purchaser's Required Regulatory Approvals and all of Purchaser's
    Required Consents shall have been obtained and shall not have been granted
    subject to or containing any terms or conditions not satisfactory to
    Purchaser, in its sole discretion, and shall be final and not subject to
    appeal or otherwise subject to challenge or modification (except with
    respect to the same provided by Mississippi regulatory authorities, which
    shall be as final as allowed prior to Closing, and not subject to any
    appeal, challenge or modification which Purchaser determines may cause the
    same to be or become unavailable or unsatisfactory following Closing).

    

 b. All of Purchaser's Additional Regulatory Approvals shall have been obtained
    and shall not have been granted subject to or containing any terms or
    conditions not satisfactory to Purchaser and each of the Participating
    Entergy Operating Companies, in their sole discretion, and shall be final
    and not subject to appeal or otherwise subject to challenge or modification
    (except with respect to the same provided by Mississippi regulatory
    authorities, which shall be as final as allowed prior to Closing, and not
    subject to any appeal, challenge or modification which Purchaser determines
    may cause the same to be or become unavailable or unsatisfactory following
    Closing).

    

    All of Seller's Required Regulatory Approvals and Seller's Required Consents
    shall have been made or obtained and shall be in such forms as could not
    reasonably be expected to (i) materially impair the authority, right or
    ability of Purchaser to consummate the Transactions or of Purchaser or any
    Participating Entergy Operating Company to consummate the Participating
    Entergy Operating Company Transactions, (ii) have a material adverse effect
    on the business, assets, properties, financial condition, results of
    operations or prospects of the Business, Purchaser or any Participating
    Entergy Operating Company, (iii) require any material modification to this
    Agreement, any Ancillary Agreement, the Transactions or the Participating
    Entergy Operating Company Transactions, or (iv) impose any restrictions upon
    Purchaser's ownership or operation of the Purchased Assets or Purchaser's or
    any Participating Entergy Operating Company's ownership of their respective
    assets or operation of their respective businesses, including any
    restrictions on use of assigned contracts.

Section 8.5    Representations and Warranties. The representations and
warranties of Seller set forth in this Agreement that are qualified with respect
to materiality shall be true and correct in all respects, and the
representations and warranties of Seller set forth in this Agreement that are
not so qualified shall be true and correct in all material respects, on and as
of the Effective Date and the Closing Date.

Section 8.6    Officer's Certificate. Purchaser shall have received a
certificate from Seller, executed on its behalf by an authorized officer, dated
the Closing Date, to the effect that the conditions set forth in Section 8.1,
Section 8.4 (to the extent relating to Seller's Required Regulatory Approvals)
and Section 8.5 have been satisfied.

Section 8.7    Title Insurance. Title to the Real Property shall have been
evidenced by the willingness of a title insurance company reasonably acceptable
to Purchaser (the "Title Insurer") to issue at regular rates an owner's, and if
applicable, leasehold policy of title insurance in the amount of the Purchase
Price and such endorsements as reasonably may be required by Purchaser, in the
name of Purchaser on the policy form issued in the State of Mississippi that
does not differ in any material respect from the Preliminary Title Commitment
(other than endorsements deemed appropriate by Purchaser) and that will include
only the exceptions to coverage listed on Schedule B-II to the Preliminary Title
Commitment, excluding those exceptions listed in Schedule 8.7 (the "Title
Policy"). The willingness of the Title Insurer to issue the Title Policies shall
be evidenced either by the issuance thereof at the Closing or by the Title
Insurer's delivery of written commitments or binders, dated as of the Closing
Date (but insuring title as of the date title conveyance documents are
recorded), to issue such Title Policies within a reasonable time after the
Closing Date, subject to actual transfer of the real property in question.

Section 8.8    New LTSA. Purchaser shall have negotiated and executed a long
term services agreement with GEII with respect to the combustion and steam
turbines of the Project on terms satisfactory to Purchaser in its sole
discretion (the "New LTSA"), which shall become effective at Closing.

Section 8.9    Material Adverse Effect. Since the Effective Date, no Material
Adverse Effect shall have occurred.

Section 8.10    Legal Opinion. Purchaser shall have received an opinion or
opinions from Greenberg Traurig, LLP, dated the Closing Date covering matters
relating to entity existence and qualification to do business, authority, no
violation or conflicts with organizational documents, contracts or applicable
laws and no required consents or approvals, subject to the conditions and
limitations therein and to other customary conditions and limitations.

Section 8.11    No Termination. Neither Party shall have exercised any
termination right such Party is entitled to exercise pursuant to Section 10.1.

Section 8.12    No Unremediated Environmental Conditions. If Purchaser elects,
the Environmental Consultant shall have delivered to Purchaser a reasonably
acceptable and complete final Environmental Assessment, and Purchaser shall be
satisfied, in its reasonable discretion based upon investigation conducted
pursuant to Section 6.11(b) and otherwise, that there is no Environmental
Condition at the Project Site requiring any Remediation, or if there is, Seller
shall have completed the Remediation in accordance with Section 6.16.

Section 8.13    Warranties. The Warranties listed in Schedule 2.1(h) shall be
included in the Purchased Assets to be assigned to Purchaser at the Closing and
any consent, waiver or approval required to be obtained from the grantor of any
of such Warranties in connection with the consummation of the Transactions shall
have been obtained.

Section 8.14    No Condemnation. None of the Purchased Assets in whole or in
part, shall have become subject to or threatened with any condemnation or
eminent domain proceeding.

Section 8.15    No Unrepaired Casualty. If all or any portion of the Purchased
Assets shall have been damaged or destroyed (whether by fire, theft, vandalism
or other casualty) in whole or in part, Seller shall have completed the full
repair or restoration of the Damaged Portion in accordance with Section 6.8,
including, if required pursuant to Section 6.8, Seller shall have obtained
Purchaser's written consent to Seller's final acceptance of such repair and
restoration.

Section 8.16    Evidence of Cure. Purchaser shall have received evidence
reasonably satisfactory to it that any uncured violations set forth in Schedule
4.4 shall have been cured.

Section 8.17    Receipt of Other Documents. Purchaser shall have received the
following:
 a. Certificates of Good Standing with respect to Seller as of a recent date
    issued by the Secretary of State of Delaware and Mississippi;

    Copies of the certificate of formation and the limited liability company
    agreement of Seller certified by the Secretary of State of Delaware,
    together with a certificate of the Secretary or an Assistant Secretary (or
    similarly situated individual) of Seller that none of such documents have
    been amended;

    Copies, certified by the Secretary or an Assistant Secretary (or similarly
    situated individual) of each of Seller of resolutions of its board of
    directors or similar governing body authorizing the execution and delivery
    by Seller of this Agreement and of the Ancillary Agreements to which it is a
    party and authorizing the performance of its obligations hereunder and
    thereunder, as applicable, and authorizing or ratifying the execution and
    delivery of, and performance of its obligations under, all of the other
    agreements and instruments, in each case, to be executed and delivered by
    Seller in connection herewith;

    A certificate of the Secretary or an Assistant Secretary (or similarly
    situated individual) of Seller identifying the name and title and bearing
    the signatures of the officers of Seller authorized to execute and deliver
    this Agreement and each Ancillary Agreement to which it is a party and the
    other agreements and instruments contemplated hereby;

    Releases in favor of Purchaser from applicable confidentiality,
    non-competition and like agreements and other reasonable agreements
    consenting to and agreeing to cooperate with the rights of Purchaser as
    contemplated by Section 6.12(b), in form and substance reasonably
    satisfactory to Purchaser and to the extent available after Seller's efforts
    in accordance with Section 6.12(b);

    The Closing Inventory Report;

 b. A receipt for the Initial Purchase Price as adjusted by the Closing
    Adjustment;

    

 c. (i) Estoppel certificates in form reasonably satisfactory to Purchaser from
    the lessor under no less than 5 of the 7 leases pertaining to Leased Real
    Property dated no earlier than the date on which Purchaser requests Seller
    to send such estoppel certificates to each such lessor, which notice shall
    be sent no later than ninety (90) days prior to the expected Closing Date
    and (ii) evidence in form reasonably satisfactory to Purchaser that the
    required notices to each lessor under each lease pertaining to Leased Real
    Property have been properly given (the foregoing items (i) and (ii) being
    the "Real Estate Curative Documents"); and

    

 d. evidence in form reasonably satisfactory to Purchaser that (i) the required
    notices described in Section 2.5(a)(ii) have been given and (ii) the
    transfer of each Material Software License to Purchaser has occurred and all
    necessary consents to such transfers have been obtained on terms
    satisfactory to Purchaser or that the applicable Replacement License
    Agreement has been entered into by Seller.

Section 8.18    Termination of Other Documents. Purchaser shall have received
evidence of the satisfactory termination of the following documents and
agreements:
 a. The Interim LTSA;

    The Tolling Agreement; and

    Any agreements with Independent Contractors with respect to Project
    Employees, including Seller's arrangements with NAES, but excluding Seller's
    arrangements with Kelson Attala, to the extent permitted by the terms of
    such agreements.

Section 8.19    Consumables. Purchaser shall have confirmed to its reasonable
satisfaction that the inventory of Consumables is sufficient, as reasonably
estimated by Purchaser, for the operation of the Project (assuming operation of
the Project at a fifty percent (50%) capacity factor) for the thirty (30) day
period following the Closing.

Section 8.20    Inspection. Purchaser shall have completed a pre-closing
inspection of the Project and the Project Site not more than thirty (30) days
prior to the Closing and confirmed and verified, to its reasonable satisfaction,
(a) the accuracy of Seller's representations and warranties set forth in
Article 4, and Seller's performance of and compliance with its covenants set
forth in this Agreement or any Ancillary Agreement, (b) that no Material Adverse
Effect shall have occurred since the Effective Date and that there shall not
have been any material adverse change in the physical condition or operations of
the Project or the Project Site since November 12, 2004, except ordinary wear
and tear or matters the subject of Section 6.8 and Section 8.15.

Section 8.21    Transmission Assets. All conditions in Article 8 of the
Transmission Assets Purchase and Sale Agreement to the consummation of the
"Closing" under, and as such term is defined in, the Transmission Assets
Purchase and Sale Agreement shall have been fulfilled or waived in a manner
acceptable to Purchaser, and Seller and Transmission Assets Purchaser shall be
ready to and shall effect such Closing contemporaneously with the Closing under
this Agreement.

ARTICLE 9

SELLER'S CONDITIONS TO CLOSING

The obligation of Seller to consummate the Transactions hereunder shall be
subject to fulfillment at or prior to the Closing of the following conditions,
except to the extent Seller waives such fulfillment in writing:

Section 9.1    Compliance with Provisions. Purchaser shall have performed or
complied in all material respects with all covenants, obligations and agreements
contained in this Agreement and the Ancillary Agreements on its part required to
be performed or complied with at or prior to the Closing.

Section 9.2    HSR Act. The waiting period under the HSR Act applicable to the
consummation of the sale of the Purchased Assets contemplated hereby shall have
expired or been terminated.

Section 9.3    No Restraint. There shall be no:

 a. Preliminary or permanent Order which prevents the consummation of the
    Transactions as herein provided; or

    

 b. Action taken, or Law enacted, promulgated or deemed applicable to the
    Transactions, by any Governmental Authority which prohibits the consummation
    of the Transactions as herein provided.

Section 9.4    Required Regulatory Approvals and Consents.
 a. All of Seller's Required Regulatory Approvals and all of Seller's Required
    Consents shall have been obtained, and shall be final and not subject to
    appeal or otherwise subject to challenge or modification, in each case to
    the extent necessary to prevent any condition that could reasonably be
    expected to (i) materially impair Seller's authority, right or ability to
    consummate the Transactions or (ii) have a material adverse effect on the
    business, assets, properties, financial condition, results of operations or
    prospects of Seller; provided that to the extent any of Seller's Required
    Regulatory Approvals or Seller's Required Consents with respect to any
    Purchased Asset have not been obtained and Purchaser elects to proceed to
    Closing, then Seller shall treat such Purchased Asset in accordance with
    Section 2.5 and this condition shall not apply to such Seller's Required
    Regulatory Approval or Seller's Required Consent.

    All of Purchaser's Required Regulatory Approvals and Purchaser's Required
    Consents (other than the Purchaser's Required Regulatory Approvals that
    relate to the transfer of the Purchased Permits) shall have been made or
    obtained and shall be in such forms as could not reasonably be expected to
    (i) materially impair Seller's authority, right or ability to consummate the
    Transactions or (ii) have a material adverse effect on the business, assets,
    properties, financial condition, results of operations or prospects of
    Seller.

Section 9.5    Representations and Warranties. The representations and
warranties of Purchaser set forth in this Agreement that are qualified with
respect to materiality shall be true and correct in all respects, and the
representations and warranties of Purchaser set forth in this Agreement that are
not so qualified shall be true and correct in all material respects, on and as
of the Effective Date and the Closing Date.

Section 9.6    Officer's Certificate. Seller shall have received a certificate
from Purchaser, executed on its behalf by an authorized officer, dated the
Closing Date, to the effect that the conditions set forth in Section 9.1,
Section 9.4 (to the extent relating to Purchaser's Required Regulatory
Approvals) and Section 9.5 have been satisfied.

Section 9.7    Legal Opinion. Seller shall have received an opinion or opinions
from internal counsel for Purchaser dated the Closing Date covering matters
relating to corporate existence and qualification to do business, authority, no
violation or conflicts with organizational documents, contracts or applicable
laws and no required consents or approvals, subject to the conditions and
limitations therein and to other customary conditions and limitations.

Section 9.8    No Termination. Neither Party shall have exercised any
termination right such Party is entitled to exercise pursuant to Section 10.1.

Section 9.9    Receipt of Other Documents. Seller shall have received the
following:
 a. A Certificate of Good Standing with respect to Purchaser, as of a recent
    date, issued by the Secretary of State of Mississippi;

    

 b. Certified copies of the articles of incorporation and the bylaws of
    Purchaser, together with a certificate of the Secretary or an Assistant
    Secretary of Purchaser that none of such documents have been amended;

    

 c. Copies, certified by the Secretary or an Assistant Secretary of Purchaser,
    of resolutions of the board of directors of Purchaser authorizing the
    execution and delivery by Purchaser of this Agreement, and each of the
    Ancillary Agreements to which it is a party and the performance of its
    obligations hereunder and thereunder, and authorizing the execution and
    delivery of, and performance of its obligations under, all of the other
    agreements and instruments, in each case, to be executed and delivered by
    Purchaser in connection herewith; and

    A certificate of the Secretary or an Assistant Secretary of Purchaser,
    identifying the name and title and bearing the signatures of the officers of
    Purchaser authorized to execute and deliver this Agreement, and each
    Ancillary Agreement to which Purchaser is a party and the other agreements
    and instruments contemplated hereby.

Section 9.10    Transmission Assets. All conditions in Article 9 of the
Transmission Assets Purchase and Sale Agreement to the consummation of the
"Closing" under, and as such term is defined in, the Transmission Assets
Purchase and Sale Agreement shall have been fulfilled or waived as required
thereunder, and Transmission Assets Purchaser shall be ready to and shall effect
such Closing contemporaneously with the Closing under this Agreement.

ARTICLE 10

TERMINATION

Section 10.1    Rights to Terminate. To the extent set forth in Section 10.2,
this Agreement may be terminated (the date of such termination being the
"Termination Date"):
 a. At any time prior to the Closing, by mutual written consent of Seller and
    Purchaser;

    

    By one Party upon written notice to the other Party on or after the
    Expiration Date;

    By one Party upon written notice to the other Party if there has been a
    material default or breach of any representation, warranty, covenant or
    other provision under this Agreement by such other Party that is not cured
    by the earlier of the Closing Date or the date thirty (30) days after
    receipt by such other Party of written notice from the terminating Party
    specifying with particularity such breach or default;

    By one Party upon written notice to the other Party: (i) at any time prior
    to the Closing, if any federal or state court of competent jurisdiction
    shall have issued an Order permanently restraining, enjoining or otherwise
    prohibiting the Closing, and such order, judgment or decree shall have
    become final without the possibility of appeal; or (ii) at any time prior to
    the Closing, if any Law shall have been enacted or issued by any
    Governmental Authority which, directly or indirectly, prohibits the
    consummation of the Transactions;

    By one Party upon written notice to the other Party, if Purchaser determines
    that any of Purchaser's conditions to Closing set forth in Article 8 will
    not be satisfied and will not be waived by Purchaser prior to Closing,
    including if Purchaser determines that the conditions specified in Section
    8.4 or Section 8.21 will not be satisfied or waived prior to Closing on
    terms satisfactory to Purchaser in accordance with the requirements of such
    section;

    By one Party upon written notice to the other Party, to the extent
    authorized under Section 6.8 or Section 6.16; and

    By one Party upon written notice to the other Party, if such other Party is
    or becomes Bankrupt or there are proceedings pending or being contemplated
    by it or threatened against it which could reasonably be expected to result
    in it being or becoming Bankrupt.

Section 10.2    Effect of Termination. If there has been a termination pursuant
to Section 10.1 then this Agreement shall be deemed terminated, and all further
obligations of the Parties hereunder shall terminate, except that (a)
obligations incurred prior to the termination, including obligations related to
the breach of this Agreement prior to the termination, shall survive and (b)
obligations under Section 6.2 and Section 10.3 and under Article 7 and Article
11 shall survive. In the event of such termination of this Agreement, there
shall be no liability for damages on the part of a Party to another under and by
reason of this Agreement except as set forth in Article 7 and Section 10.3, and
except for intentionally fraudulent acts by a Party, the remedies for which
shall not be limited by the provisions of this Agreement. The foregoing
provisions shall not, however, limit or restrict the availability of specific
performance or other injunctive or equitable relief to the extent that specific
performance or such other relief would otherwise be available to a Party
hereunder.

Section 10.3    Liquidated Damages for Costs and Expenses. If Purchaser
terminates this Agreement pursuant to Section 10.1(c) or Section 10.1(g), or if
this Agreement is terminated by either Party pursuant to Section 10.1(e) (other
than with respect to (i) any unsatisfied or unwaived condition in Article 8 the
satisfaction of which was required to have been achieved by Purchaser under the
terms of this Agreement, (ii) any unsatisfied or unwaived condition from the
Transmission Purchase Agreements or the Transmission Arrangement Agreements
incorporated in Section 8.21 the satisfaction of which was required to have been
achieved by Transmission Purchaser or Purchaser under the terms thereof, (iii)
satisfaction of the conditions set forth in Section 8.17(h) or Section 8.17(i)),
or if this Agreement is terminated by either Party in accordance with Section
6.8 or Section 6.16 but only to the extent described in accordance with Section
6.8 or Section 6.16; then the Liquidated Damages for Costs and Expenses shall
become immediately due and payable by Seller and Seller shall pay the Liquidated
Damages for Costs and Expenses to Purchaser within ten (10) calendar days of
Seller's receipt of notice of such termination (or, if later, the date on which
such notice is effective), by wire transfer of immediately available funds to an
account designated in writing by Purchaser. The payment of the Liquidated
Damages for Costs and Expenses constitutes liquidated damages to reimburse
Purchaser for the internal management, technical, legal and general and
administrative costs and expenses of Purchaser with respect to, or that would
not otherwise have been incurred absent, the negotiation, execution, delivery
and performance and termination under this Agreement through the date of
termination (the "Purchaser General Costs and Expenses"). With respect to the
Liquidated Damages for Costs and Expenses, the Parties acknowledge and agree
that (i) the damages of Purchaser associated with the Purchaser General Costs
and Expenses are likely to be substantial and unreasonably difficult to
quantify, (ii) the Liquidated Damages for Costs and Expenses are a reasonable
estimate of Purchaser's actual damages for the Purchaser General Costs and
Expenses, (iii) payment of the Liquidated Damages for Costs and Expenses are
appropriate as liquidated damages and are not a penalty, and (iv) payment of the
Liquidated Damages for Costs and Expenses shall be deemed Purchaser's sole and
exclusive remedy of Purchaser under this Agreement for damages associated with
Purchaser General Costs and Expenses, but not for any other damages of Purchaser
such as direct damages for any difference between the value of the Purchased
Assets and the Purchase Price that may be payable to Purchaser in accordance
with the provisions of Section 7.1.

ARTICLE 11

GENERAL PROVISIONS

Section 11.1    Entire Document; Amendments. This Agreement (including the
Exhibits and Schedules to this Agreement), the Ancillary Agreements to which
they are a party, and the Confidentiality Agreement contain the entire agreement
between the Parties with respect to the Purchaser Transactions, and supersede
all negotiations, representations, warranties, commitments, offers, contracts
and writings (except for, the Confidentiality Agreement and any such Ancillary
Agreements executed prior to the date hereof) prior to the execution date of
this Agreement, written or oral. No modification or amendment of any provision
of this Agreement shall be effective unless made in writing and duly signed by
the Parties referring specifically to this Agreement.

Section 11.2    Schedules. Seller may from time to time notify Purchaser of any
changes or additions to any of Seller's Schedules to this Agreement and
Purchaser may from time to time notify Seller of any changes or additions to any
of Purchaser's Schedules to this Agreement by the delivery of amendments or
supplements thereto. No such notification, change, addition, amendment or
supplement shall become effective or cure any breach of any representation or
warranty, covenant or other provision of this Agreement unless and until the
same has been approved by the other Party in its sole discretion, except with
respect to Schedules 2.1(c)-(j), 2.2(g), 4.8, 4.24, 4.25, and 6.12, where the
other Party's approval shall not be unreasonably withheld provided that the same
reflects an updated condition occurring as a result of the ordinary course of
business in compliance with the terms of this Agreement that could not
reasonably be expected to have a material adverse effect upon such Party or with
respect to Seller's Schedules a Material Adverse Effect.

Section 11.3    Counterparts. This Agreement may be executed in one or more
counterparts, each of which is an original, but all of which together constitute
one and the same instrument.

Section 11.4    Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be valid, binding and
enforceable under applicable Law, but if any provision of this Agreement is held
to be invalid, void (or voidable) or unenforceable under applicable Law, such
provision shall be ineffective only to the extent held to be invalid, void (or
voidable) or unenforceable, without affecting the remainder of such provision or
the remaining provisions of this Agreement. To the extent permitted by Law, the
Parties waive any provision of Law that renders any provision hereof prohibited
or unenforceable in any respect.

Section 11.5    Assignment. The rights under this Agreement shall not be
assignable or transferable nor the duties delegable by either Party without the
prior written consent of the other Party, which consent may be granted or
withheld in such other Party's sole discretion. Seller will not unreasonably
withhold its consent to any such assignment, transfer or delegation of this
Agreement by Purchaser to an Affiliate of Purchaser. Any assignment effected in
accordance with this Section 11.5 will not relieve the assigning Party of its
obligations and liabilities under this Agreement and the Ancillary Agreements to
which it is a party. Any purported assignment or delegation not effected in
accordance with this Section 11.5 shall be deemed void.

Section 11.6    Captions. The captions of the various Articles, Sections,
Exhibits and Schedules of this Agreement have been inserted only for convenience
of reference and do not modify, explain, enlarge or restrict any of the
provisions of this Agreement.

Section 11.7    Governing Law. The validity, interpretation and effect of this
Agreement are governed by and will be construed in accordance with the laws of
the State of New York without regard to conflicts of law doctrines (other than
Section 5-1401 of the New York General Obligations Law), except to the extent
that (i) certain matters are preempted by federal law or are governed by the law
of the respective jurisdiction of incorporation or formation, as applicable of
the Parties or (ii) certain matters with respect to real property are governed
by the law of the State of Mississippi.

Section 11.8    Dispute Resolution.
 a. Generally: The dispute resolution procedures set forth in this Section 11.8
    shall govern the resolution of any dispute, claim or controversy arising out
    of, under or relating to this Agreement and the Purchaser Transaction and
    any right or obligation thereunder, or the breach or termination thereof
    ("Dispute"), unless otherwise provided in this Agreement or mutually agreed
    to by the Parties. Resolution of any Dispute hereunder shall be by senior
    executives of the Parties or, upon failure to timely reach a solution in
    such manner, litigation, all as provided in this Section 11.8.

    

    

 b. Negotiation by Representatives: In the event of a Dispute, the Party seeking
    resolution shall begin this process by first providing written notice of the
    Dispute to the other Party which notice shall contain a brief description of
    the Dispute. Not later than seven (7) days after the date of delivery of the
    initial notice of Dispute, each Party shall select and appoint a
    representative to attempt to resolve the Dispute. Not later than
    fourteen (14) days after delivery of the initial written notice of said
    Dispute, each Party shall provide to the other a written explanation of the
    material particulars of its position as to the Dispute. Not later than
    twenty-one (21) days after delivery of the written notice of a Dispute, as
    provided above, the representatives selected by the Parties shall meet to
    attempt in good faith to settle the Dispute ("First Meeting Deadline") and
    to produce a written agreement setting forth the terms of settlement. The
    written settlement agreement, if any, when signed by each Party, shall
    govern the Parties' resolution of the Dispute and serve as conclusive
    evidence of the resolution of such Dispute. If and only if, the Parties'
    representatives fail to produce and the Party's fail to sign a written
    settlement agreement, then (A) not later than fourteen (14) days after the
    date of such representatives' first meeting, or (B) within twenty-one (21)
    days after the First Meeting Deadline (in the event the representatives fail
    to meet by the First Meeting Deadline), or (C) within such longer period as
    may be mutually agreed to by the Parties in writing, then either Party may
    commence litigation in accordance with Section 11.8(c).

    

    

 c. Initiation of Litigation: After, but only after, the period for resolution
    of a Dispute set forth above has terminated without a resolution of a
    Dispute, or earlier if both Parties agree, the Dispute may be submitted for
    litigation. In the event that litigation is commenced, the substance of any
    and all communications between the Parties or their representatives pursuant
    to Sections 11.8(a) and (b) above shall be treated as settlement discussions
    and shall not be admissible as evidence in the litigation of the Dispute
    (except to establish, if necessary, the Parties compliance or non-compliance
    with the provisions of the Dispute Resolution process set forth in this
    Section 11.8).

    

    

 d. Waiver of Jury Trial: EACH OF THE PARTIES EXPRESSLY WAIVES ANY RIGHT TO
    TRIAL BY JURY IN ANY LITIGATION, ACTION OR PROCEEDING ARISING OUT OF OR IN
    CONNECTION WITH THIS AGREEMENT.

Section 11.9    Notices. All notices, requests, statements or payments shall be
made as specified below. Notices shall, unless otherwise specified herein, be in
writing and may be delivered by hand delivery, United States mail, overnight
courier service, electronic mail or other electronic transmission, or facsimile.
Notice by facsimile, electronic mail or other electronic transmission or hand
delivery shall be effective at the close of business on the day actually
received, if received during business hours on a Business Day, and otherwise
shall be effective at the close of business on the next Business Day. Notice by
overnight courier shall be effective on the next Business Day after it was sent
and notice by mail shall be effective on five (5) days following deposit in the
United States mail, postage prepaid. A Party may change its addresses by
providing notice of same in accordance herewith.

        If to Seller to:

> > > > Central Mississippi Generating Company, LLC
> > > > c/o R.W. Beck Plant Management Ltd.
> > > > The Corporate Center, East Wing
> > > > 550 Cochituate Road
> > > > Framingham, MA 01701
> > > > Attention: David L. Patton
> > > > Fax: (508) 935-1888
> > > >  

        with a copy to:

> > > > Greenberg Traurig, LLP
> > > > 200 Park Avenue
> > > > New York, NY 10166
> > > > Attention: Nathan Limpert
> > > > Fax: (212) 801-6400
> > > > and

        If to Purchaser to:

> > > > Entergy Mississippi, Inc.
> > > > City Centre
> > > > 200 South Lamar
> > > > Suite 500
> > > > Jackson, MS 39201
> > > > Attention: Carolyn Shanks

        with copies to:

> > > > Entergy Services, Inc.
> > > > Parkwood 2 Building - Suite 300
> > > > 10055 Grogan's Mill Road
> > > > The Woodlands, TX 77380
> > > > Attention: Bill Mohl
> > > > Fax: 281-297-3929
> > > > 
> > > > Entergy Services, Inc.
> > > > Parkwood 2 Building - Suite 300
> > > > 10055 Grogan's Mill Road
> > > > The Woodlands, TX 77380
> > > > Attention: Carol St. Clair
> > > > Fax: 281-297-3945
> > > > 
> > > > 
> > > > Bracewell & Patterson, L.L.P.
> > > > 711 Louisiana, Suite 2900
> > > > Houston, TX 77002
> > > > Attention: Robert Stephens
> > > > Fax: 713-222-3202

or to such other Person at such other address as a Party shall designate by like
notice to the other Party.

Any Party may from time to time change its address for the purpose of notices to
that Party by a similar notice specifying a new address, but no such change is
effective until it is actually received by the Party sought to be charged with
its contents.

Section 11.10    No Third Party Beneficiaries. Except as may be specifically set
forth in this Agreement, nothing in this Agreement, whether express or implied,
is intended to confer any rights or remedies under or by reason of this
Agreement on any Person other than the Parties, their respective permitted
successors and assigns, and any Person benefiting from the indemnities provided
herein, nor is anything in this Agreement intended to relieve or discharge the
obligation or liability of any third Persons to any Party, nor give any third
Persons any right of subrogation or action against any Party.

Section 11.11    No Joint Venture. Nothing contained in this Agreement creates
or is intended to create an association, trust, partnership or joint venture or
impose a trust or partnership duty, obligation or liability on or with regard to
any Party.

Section 11.12   Construction of Agreement. This Agreement and any documents or
instruments delivered pursuant hereto shall be construed without regard to the
identity of the Person who drafted the various provisions of the same. Each and
every provision of this Agreement and such other documents and instruments shall
be construed as though the Parties participated equally in the drafting of the
same. Consequently, the Parties acknowledge and agree that any rule of
construction that a document is to be construed against the drafting party shall
not be applicable either to this Agreement or such other documents and
instruments.

Section 11.13    Waiver of Compliance. To the extent permitted by applicable
Law, any failure to comply with any obligation, covenant, agreement or condition
set forth herein or in any Ancillary Agreement, or any breach of any
representation or warranty set forth herein or in any Ancillary Agreement, may
be waived by the Party entitled to the benefit of such obligation, covenant,
agreement, condition, representation or warranty only by a written instrument
signed by such Party that expressly waives such failure or breach, but any such
waiver shall not operate as a waiver of, or estoppel with respect to, any prior
or subsequent failure to comply therewith or breach thereof. The waiver of any
condition based on the accuracy of any representation or warranty, or on the
performance of or compliance with any covenant or obligation, or the waiver of
the fulfillment of any such condition, will not affect the right to
indemnification or other remedy based on such representation, warranty, covenant
or obligation. The failure of a Party to this Agreement to assert any of its
rights under this Agreement or otherwise shall not constitute a waiver of such
rights.

Section 11.14    Survival; Right to Indemnification Not Affected by Knowledge.
 a. All representations and warranties given or made by either Party in this
    Agreement or any certificate or other writing furnished in connection
    herewith, and related indemnity rights, shall survive the Closing for a
    period of twelve (12) months after the Closing Date and shall thereafter
    terminate and be of no further force or effect except that any
    representation or warranty, and related indemnity rights, as to which a
    claim (including a contingent claim) shall have been asserted during the
    survival period shall continue in effect with respect to such claim until
    such claim shall have been finally resolved or settled.

    

    The covenants and agreements of the Parties contained in Article 7 and
    Article 11 of this Agreement shall survive the Closing indefinitely, unless
    otherwise specified herein.

    Except as set forth in Section 5.8, the representations and warranties of
    the Parties set forth herein, subject to the express exceptions thereto,
    shall not be affected by any information furnished to, or any investigation
    or audit conducted before or after the Effective Date or the Closing Date
    by, any of the Parties or their respective representatives in connection
    with the Transactions, and each Party shall be entitled to rely upon the
    representations and warranties of the other Party set forth herein
    notwithstanding any investigation or audit conducted before or after the
    Closing Date or the decision of any Party to complete the Closing. Except as
    set forth in Section 5.8, the right to indemnification or other remedy based
    on any of the representations, warranties, covenants or obligations in this
    Agreement or any of the Ancillary Agreements will not be affected by any
    investigation or audit conducted with respect to, or any Knowledge acquired
    (or capable of being acquired) at any time, whether before or after the
    execution and delivery of this Agreement or the Closing Date, with respect
    to the accuracy or inaccuracy of or compliance with, any such
    representation, warranty, covenant, or obligation.

Section 11.15    Expenses. Each Party shall bear its own costs, fees and
expenses (including attorneys' fees) in connection with the preparation of this
Agreement.

[signature page follows]

IN WITNESS WHEREOF

, the Parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the date first set forth above.

 

CENTRAL MISSISSIPPI GENERATING COMPANY, LLC

a Delaware limited liability company

By: R.W. Beck Plant Management, Ltd., its
Manager

By                                                                 
Name: David L. Patton
Title: Manager

 

ENTERGY MISSISSIPPI, INC.

a Mississippi corporation

By                                                                 
Name:
Title: