**EXHIBIT10.43**

 

PARTICIPATIONAGREEMENT

 

 

BY AND BETWEEN

 

 

LOUISVILLE GASAND ELECTRIC COMPANY220 West Main StreetPost Office Box 32010 (40232)Louisville, Kentucky 40202

 

 

AND

 

 

INDIANAMUNICIPAL POWER AGENCY11610 North College AvenueCarmel, Indiana 46032

 

 

February 1,1993

 

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|                                      |                                                                |   |
|-------------------------------------------|---------------------------------------------------------------------|--------|
| **TABLE OF CONTENTS**                     |
|                                      |                                                                |   |
| ARTICLE 1. DEFINITIONS                    |                                                                |
| 1.1.                                      | Agreed Rate.                                                        |   |
| 1.2.                                      | Agreement.                                                          |   |
| 1.3.                                      | Available.                                                          |   |
| 1.4.                                      | Capacity Factor.                                                    |   |
| 1.5.                                      | Closing.                                                            |   |
| 1.6.                                      | Commercial Operation Date.                                          |   |
| 1.7.                                      | Construction Work.                                                  |   |
| 1.8.                                      | Coordination Committee.                                             |   |
| 1.9.                                      | Delivery Points.                                                    |   |
| 1.10.                                     | Effective Date.                                                     |   |
| 1.11.                                     | Electric Capability.                                                |   |
| 1.12.                                     | Electric Energy.                                                    |   |
| 1.13.                                     | Electric Capability And Energy.                                     |   |
| 1.14.                                     | Electric Capability And Energy Entitlement.                         |   |
| 1.15.                                     | Execution Date.                                                     |   |
| 1.16.                                     | Fixed Operation and Maintenance Expenses.                           |   |
| 1.17.                                     | Force Majeure.                                                      |   |
| 1.18.                                     | Fuel/Reactant Operation Expenses.                                   |   |
| 1.19.                                     | Good Utility Practice.                                              |   |
| 1.20.                                     | Incremental Capital Assets.                                         |   |
| 1.21.                                     | Insurance.                                                          |   |
| 1.22.                                     | Interconnection Agreement.                                          |   |
| 1.23.                                     | Internal Load.                                                      |   |
| 1.24.                                     | Joint Transmission System.                                          |   |
| 1.25.                                     | Louisville’s Cost Of Capital.                                  |   |
| 1.26.                                     | Net Electric Generating Capability And  Associated Electric Energy. |   |
| 1.27.                                     | Net Seasonal Capability.                                            |   |
| 1.28.                                     | Operating Work.                                                     |   |
| 1.29.                                     | Owners.                                                             |   |
| 1.30.                                     | Representative.                                                     |   |
| 1.31.                                     | Trimble County General Plant Facilities.                            |   |
| 1.32.                                     | Trimble County Plant.                                               |   |
| 1.33.                                     | Trimble County Site.                                                |   |
| 1.34.                                     | Trimble County Unit 1.                                              |   |
| 1.35.                                     | Uniform System Of Accounts.                                         |   |
| ARTICLE 2. OWNERSHIP INTEREST AND SALE    |                                                                |
| 2.1.                                      | Ownership Interests.                                                |   |
| 2.2.                                      | Sale Of Property Included In Trimble County  Unit 1.                |   |
| 2.3.                                      | Release From Lien Of Louisville’s  Indenture.                  |   |
| 2.4.                                      | Closing.                                                            |   |
| 2.5.                                      | Additional Generating Units.                                        |   |
| 2.6.                                      | Modification Of Existing Property.                                  |   |
| ARTICLE 3. PURCHASE, PAYMENT, AND CLOSING |                                                                |

 

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| 3.1.                                                          | Purchase Price.                                                   |   |
|---------------------------------------------------------------|-------------------------------------------------------------------|--------|
| 3.2.                                                          | Closing.                                                          |   |
| 3.2.1.                                                        | Date And Place.                                                   |   |
| 3.2.2.                                                        | Delivery Of Documents, Certificates, And  Funds.                  |   |
| 3.3.                                                          | Special Conditions.                                               |   |
| 3.4.                                                          | Continued Marketing By Louisville.                                |   |
| 3.5.                                                          | Termination If Closing Does-Not Occur.                            |   |
| ARTICLE 4. REPRESENTATIONS, WARRANTIES, AND  MUTUAL COVENANTS |                                                              |
| 4.1.                                                          | IMPA Representations.                                             |   |
| 4.1.1.                                                        | IMPA Organization                                                 |   |
| 4.1.2.                                                        | Authority Relative To This Agreement.                             |   |
| 4.1.3.                                                        | Approvals And Consents.                                           |   |
| 4.1.4.                                                        | Legal Proceedings.                                                |   |
| 4.2.                                                          | Louisville Representations.                                       |   |
| 4.2.1.                                                        | Louisville Organization.                                          |   |
| 4.2.2.                                                        | Authority Relative To This Agreement.                             |   |
| 4.2.3.                                                        | Approvals And Consents.                                           |   |
| 4.2.4.                                                        | Legal Title.                                                      |   |
| 4.2.5.                                                        | Condition Of Plant And Equipment.                                 |   |
| 4.2.6.                                                        | Legal Proceedings.                                                |   |
| ARTICLE 5. OPERATING ARRANGEMENTS                             |                                                              |
| 5.1.                                                          | Authority For Operation And Management.                           |   |
| 5.2.                                                          | Scheduling And Dispatching Of Electric  Generation                |   |
| 5.3.                                                          | Economic Replacement Of Trimble County Unit  1 Energy.            |   |
| 5.4.                                                          | Electric Capability And Energy  Entitlements.                     |   |
| 5.5.                                                          | Operations Management.                                            |   |
| 5.5.1.                                                        | Administration Of Operating Work And  Incremental Capital Assets. |   |
| 5.5.2.                                                        | Purchasing Necessary Goods And Services.                          |   |
| 5.5.3.                                                        | Procurement Of Fuel.                                              |   |
| 5.5.4.                                                        | Expenditure Of Funds.                                             |   |
| 5.5.5.                                                        | Insurance.                                                        |   |
| 5.5.6.                                                        | Enforcement Of Claims Against Third  Parties.                     |   |
| 5.5.7.                                                        | Processing Claims By Third Parties.                               |   |
| 5.5.8.                                                        | Delivery Of Operating data.                                       |   |
| 5.6.                                                          | Environmental Laws and Regulations.                               |   |
| 5.7.                                                          | Indemnification Of Environmental Fines And  Penalties.            |   |
| ARTICLE 6. INCREMENTAL CAPITAL ASSETS                         |                                                              |
| 6.1.                                                          | Determination Of Need.                                            |   |
| 6.2.                                                          | Estimate Of Costs.                                                |   |
| 6.3.                                                          | Responsibility For Costs.                                         |   |
| ARTICLE 7. COMPENSATION                                       |                                                              |
| 7.1.                                                          | Monthly Charges.                                                  |   |
| 7.1.1.                                                        | Fuel/Reactant Operation Expense.                                  |   |
| 7.2.                                                          | Fixed Operation And Maintenance Expenses.                         |   |
| 7.2.1.                                                        | Non-Fuel Operating Component.                                     |   |
| 7.2.2.                                                        | Working Capital Component.                                        |   |

 

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| 7.2.3.                                    | Transmission Charge.                                                |   |
|-------------------------------------------|---------------------------------------------------------------------|--------|
| ARTICLE 8. BILLING, PAYMENTS, AND RECORDS |                                                                |
| 8.1.                                      | Billings By Louisville.                                             |   |
| 8.2.                                      | Payments By IMPA Or Louisville.                                     |   |
| 8.3.                                      | Records.                                                            |   |
| ARTICLE 9. TRANSMISSION SERVICE           |                                                                |
| ARTICLE 10. BACKUP POWER AND ENERGY       |                                                                |
| 10.1.                                     | From Louisville.                                                    |   |
| 10.2.                                     | From Third Parties.                                                 |   |
| 10.3.                                     | Effective Date Of Backup Power Provision.                           |   |
| ARTICLE 11. GENERAL CONDITIONS            |                                                                |
| 11.1.                                     | Cooperation.                                                        |   |
| 11.2.                                     | Approvals.                                                          |   |
| 11.3.                                     | Access.                                                             |   |
| 11.4.                                     | Conditions Precedent To Louisville’s  Obligations Hereunder.   |   |
| 11.4.1.                                   | Accuracy Of IMPA’s Representations And  Warranties.            |   |
| 11.4.2.                                   | Capability Of Performance By IMPA.                                  |   |
| 11.4.3.                                   | Opinion Of Counsel For IMPA.                                        |   |
| 11.4.4.                                   | Payment Of Funds By IMPA.                                           |   |
| 11.5.                                     | Conditions Precedent To IMPA’s Obligations  Hereunder.         |   |
| 11.5.1.                                   | Accuracy Of Louisville’s Representations  And Warranties.      |   |
| 11.5.2.                                   | Opinion of Counsel for Louisville.                                  |   |
| 11.5.3.                                   | Opinion Of Counsel For Louisville.                                  |   |
| 11.6.                                     | Conditions Precedent To The Respective  Obligations Of The Parties. |   |
| 11.7.                                     | Release From Louisville’s Indenture(s).                        |   |
| 11.8.                                     | Amendments.                                                         |   |
| 11.9.                                     | Limited Warranty.                                                   |   |
| 11.10.                                    | No Agency Or Third Party Beneficiary                                |   |
| ARTICLE 12. TAXES                         |                                                                |
| 12.1.                                     | Management Of Tax Matters.                                          |   |
| 12.1.1.                                   | Louisville’s Responsibility                                    |   |
| 12.1.2.                                   | IMPA’s Responsibility.                                         |   |
| 12.1.3.                                   | Cooperation.                                                        |   |
| 12.2.                                     | Sharing Of Taxes And Related Payments                               |   |
| 12.3.                                     | Payment Of Title Taxes And Fees                                     |   |
| 12.4.                                     | Exclusion Of Income Taxes                                           |   |
| 12.5.                                     | Non-creation Of Taxable Entity                                      |   |
| ARTICLE 13. INSURANCE                     |                                                                |
| 13.1.                                     | Procurement Of Insurance.                                           |   |
| 13.1.1.                                   | Sharing Of Insurance Costs.                                         |   |
| 13.1.2.                                   | IMPA Named As Insured.                                              |   |
| 13.1.3.                                   | Procurement Of Additional Insurance For  IMPA.                      |   |
| 13.1.4.                                   | Sharing Of Refunds From Insurance Premiums.                         |   |
| 13.1.5.                                   | Sharing Of Insurance Proceeds                                       |   |
| 13.2.                                     | Destruction.                                                        |   |
| 13.2.1.                                   | Damage Or Destruction Fully Covered By  Insurance                   |   |

 

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| 13.2.2.                                                                    | Damage Or Destruction Not Fully Covered By  Insurance.                   |   |
|----------------------------------------------------------------------------|--------------------------------------------------------------------------|--------|
| ARTICLE 14. PARTITION OF OR TRANSFER OF  INTEREST IN TRIMBLE COUNTY UNIT 1 |                                                                     |
| 14.1.                                                                      | Special Nature Of Trimble County Unit 1 .  Waiver Of Right Of Partition. |   |
| 14.2.                                                                      | Transfer Of Ownership Interests To Third  Parties.                       |   |
| 14.2.1.                                                                    | Conditions Of Transfer                                                   |   |
| 14.2.2.                                                                    | Further Conditions Of Transfer                                           |   |
| 14.2.3.                                                                    | Non-applicability Of Certain Provisions                                  |   |
| 14.3.                                                                      | Transfer Of Associated Rights And Interests                              |   |
| ARTICLE 15. RIGHT OF FIRST REFUSAL                                         |                                                                     |
| ARTICLE 16. ASSIGNMENT                                                     |                                                                     |
| 16.1.                                                                      | Limitation Of Assignability.                                             |   |
| 16.2.                                                                      | Successors And Assigns.                                                  |   |
| ARTICLE 17. LIABILITY AND DEFAULT                                          |                                                                     |
| 17.1.                                                                      | Liability To Third Parties.                                              |   |
| 17.2.                                                                      | Liability Between The Parties.                                           |   |
| 17.3.                                                                      | Indemnification.                                                         |   |
| 17.4.                                                                      | Nature And Survival Of Representations And  Warranties.                  |   |
| 17.5.                                                                      | Default.                                                                 |   |
| 17.5.1.                                                                    | Events of Default.                                                       |   |
| 17.5.2.                                                                    | Curing Default In Regard To Paying Money.                                |   |
| 17.5.3.                                                                    | Curing Default For Other Than Failure To  Pay Money                      |   |
| 17.5.4.                                                                    | Non-Applicability Of Cure Provisions                                     |   |
| 17.5.5.                                                                    | Appointment Of A Receiver.                                               |   |
| 17.5.6.                                                                    | Additional Obligations.                                                  |   |
| 17.5.7.                                                                    | Waivers                                                                  |   |
| 17.5.8.                                                                    | Legal And Other costs.                                                   |   |
| 17.6.                                                                      | Force Majeure                                                            |   |
| ARTICLE 18. ADMINISTRATION                                                 |                                                                     |
| 18.1.                                                                      | Coordination Committee.                                                  |   |
| 18.2.                                                                      | Membership.                                                              |   |
| 18.3.                                                                      | Meetings.                                                                |   |
| 18.4.                                                                      | Functions                                                                |   |
| 18.5.                                                                      | Records                                                                  |   |
| 18.6.                                                                      | Expenses.                                                                |   |
| 18.7.                                                                      | Conduct                                                                  |   |
| ARTICLE 19. DISAGREEMENT                                                   |                                                                     |
| 19.1.                                                                      | Consultation.                                                            |   |
| 19.2.                                                                      | Disagreement.                                                            |   |
| 19.2.1.                                                                    | Arbitration.                                                             |   |
| ARTICLE 20. REMEDIES                                                       |                                                                     |
| 20.1.                                                                      | All Remedies . Setoff.                                                   |   |
| 20.2.                                                                      | Injunctive Relief.                                                       |   |
| 20.3.                                                                      | No Remedy Exclusive.                                                     |   |
| 20.4.                                                                      | Failure To Participate In Incremental  Capital Assets.                   |   |
| ARTICLE 21. MISCELLANEOUS                                                  |                                                                     |

 

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| 21.1.                            | Governing Law.                          |   |
|----------------------------------|-----------------------------------------|--------|
| 21.2.                            | Notice To Parties.                      |   |
| 21.3.                            | Article Headings Not To Affect Meaning. |   |
| 21.4.                            | Counterparts.                           |   |
| 21.5.                            | Time.                                   |   |
| 21.6.                            | Severability.                           |   |
| 21.7.                            | Integration.                            |   |
| 21.8.                            | Computation Of Time.                    |   |
| 21.9.                            | Waiver.                                 |   |
| 21.10.                           | Equal Opportunity Clause.               |   |
| 21.11.                           | Non-Segregated Facilities.              |   |
| 21.12.                           | Condemnation.                           |   |
| ARTICLE 22. TERM AND TERMINATION |                                    |
| 22.1.                            | Termination.                            |   |
| 22.2.                            | Retirement Of Property.                 |   |
| 22.3.                            | Retirement Costs.                       |   |
|                             |                                    |   |

 

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AGREEMENT

 

ThisAgreement, dated February 1, 1993, between Louisville Gas and Electric Company(“Louisville” or a “Party”), a Kentucky corporation, and Indiana MunicipalPower Agency (“IMPA” or a “Party”), a body corporate and politic and apolitical subdivision of the State of Indiana, collectively (the “Parties”).

 

WHEREAS, IMPAis an agency composed of numerous municipally-owned electric systems, and isempowered, among other things, to plan, finance, develop, own and operatedprojects to supply electric power and energy on a collective basis for thepresent and future needs of its members; and

 

WHEREAS,Louisville is a regulated public utility and owns and operates facilities forthe generation, transmission, and distribution of electric power and energy inthe Commonwealth of Kentucky, and

 

WHEREAS, IMPAowns and operates facilities for the generation and transmission of electricpower and energy to provide electric power and energy to its members in theState of Indiana, and

 

WHEREAS, Louisvilleis the owner of the Trimble County Plant, consisting of Trimble CountyUnit 1, the Trimble County General Plant Facilities, and the TrimbleCounty Site, of which Illinois Municipal Electric Agency (“IMEA”) owns anundivided 12.12 percent interest in Trimble County Unit 1; and

 

WHEREAS,Louisville and IMPA are entering into this Agreement to establish (a) therespective ownership interests of the Parties in Trimble County Unit 1, and (b)the respective obligations and rights of the Parties with respect to theoperation and maintenance of Trimble County Unit 1.

 

NOW,THEREFORE, in consideration of the premises and of the mutual covenants hereinset forth, and subject to the terms and conditions herein set forth, theParties agree as follows:

 

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**ARTICLE 1.DEFINITIONS**

 

1.1.          AgreedRate.

 

Two (2)percent per annum above the published prime commercial lending rate establishedfrom time to time by Chase Manhattan Bank, N.A., New York, New York.

 

1.2.          Agreement.

 

ThisParticipation Agreement between Louisville and IMPA dated as of February 1,1993.

 

1.3.          Available.

 

The state inwhich a unit is capable of providing service regardless of the capacity levelthat can be provided.

 

1.4.          Capacity Factor.

 

The ratio ofthe actual net electric energy generated by Trimble County Unit 1 in a periodof time to the maximum net electric energy that could be generated by the sameunit in the same period of time if such unit operated uninterrupted at its NetSeasonal Capability rating.

 

1.5.          Closing.

 

The deliveryof documents and certificates and the payment of money as provided in Article3.

 

1.6.          Commercial Operation Date.

 

December 23,1990, the date on which Trimble County Unit 1 was determined by Louisville tobe reliable as a source of electric capacity and energy.

 

1.7.          Construction Work.

 

Allengineering, design, contract preparation, purchasing (of equipment, materials,and supplies), construction, supervision, expediting, inspection, accounting,testing and start-up for the Trimble County Plant and preparation of operatingand equipment manuals, quality assurance manuals, emergency action plans, allreports required by regulatory authorities and the conduct of hearings and allother activities incidental to obtaining requisite permits, licenses, andcertificates for the construction and operation of the Trimble County Plantprior to the Commercial Operation Date of Trimble County Unit 1 in accordancewith Electric Plant Instruction No. 3, Components of Construction Cost, UniformSystem of Accounts. Construction Work, as used in

 

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Article 15hereof, shall refer to the categories of costs and expenses set forth above,which relate to the unit to be constructed referenced in Article 15.

 

1.8.          Coordination Committee.

 

The committeeestablished pursuant to Article 18 hereof.

 

1.9.          Delivery Points.

 

Theinterconnection points of Louisville’s system with the Joint TransmissionSystem and with any other utility or utilities with which IMPA has contractedfor transmission service to transmit power from Louisville to IMPA.

 

1.10.        EffectiveDate.

 

The date onwhich Closing occurs pursuant to Article 3 of this Agreement.

 

1.11.        Electric Capability.

 

Megawatts (MW)of electric demand.

 

1.12.        ElectricEnergy.

 

Megawatt-hours(MWH) of electric energy.

 

1.13.        Electric Capability And Energy.

 

ElectricCapability and associated Electric Energy.

 

1.14.        Electric Capability And EnergyEntitlement.

 

The percentageof the Net Electric Generating Capability and Associated Electric Energy ofTrimble County Unit 1 to which Louisville or IMPA, as the case may be, isentitled under Article 5.4 of this Agreement.

 

1.15.        ExecutionDate.

 

The date uponwhich the Parties entered into this Agreement, which appears at the beginningof this Agreement.

 

1.16.        Fixed Operation and MaintenanceExpenses.

 

The FixedOperation and Maintenance Expenses are calculated as the sum of the followingexpenses as they relate to the operation ~ and maintenance of Trimble CountyUnit 1, Trimble County General Plant Facilities (as such pertain to TrimbleCounty Unit 1), and the Trimble County Site (as such pertain to Trimble CountyUnit 1), as recorded in Louisville’s accounting records under the UniformSystem of Accounts:

 

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(a)           Operation supervisionand engineering (Account 500).

 

(b)           Steam expenses (Account502 except for scrubber reactant).

 

(c)           Electric expenses(Account 505).

 

(d)           Miscellaneous steampower expenses (Account 506).

 

(e)           Rents (Account 507).

 

(f)            Maintenancesupervision and engineering (Account 510).

 

(g)           Maintenance ofstructures (Account 511).

 

(h)           Maintenance of boilerplant (Account 512).

 

(i)            Maintenance ofelectric plant (Account 513).

 

(j)            Maintenance ofmiscellaneous steam plant (Account 514).

 

1.17.        ForceMajeure.

 

Any causebeyond the reasonable control of a Party, and which by reasonable efforts theParty is unable to overcome, including without limitation, the following: actsof God; strikes, lockouts, or other industrial disturbances; acts of publicenemies; acts, orders, or absence of necessary orders and permits of any kind,from the government of the United States, or from the government of one of itssovereign states, or any of their departments, agencies, or officials, or fromany civil or military authority insurrections; riots; delay in transportation;unforeseen soil conditions; equipment, material, supplies, labor, or machineryshortages; epidemics; landslides; lightning; earthquakes; fire; hurricanes;tornadoes; storms; floods; washouts; drought; arrest; war; civil disturbances;explosions; breakage or accident to machinery, equipment, transmission lines,pipes, or canals; partial or entire failure of utility service; breach ofcontract by any supplier, contractor, subcontractor, laborer, or materialman;sabotage; injunction; blight; famine; blockage; quarantine; or any othersimilar or dissimilar cause or event not reasonably within the control of theParty. Force Majeure does not include financial inability to pay, and shallnot, in any event, excuse payment for obligations already incurred hereunder atthe time such claim is made.

 

1.18.        Fuel/Reactant Operation Expenses.

 

Thefuel/reactant operation expenses are calculated as the sum of the followingexpenses as recorded in Louisville’s accounting records under the UniformSystem of Accounts:

 

(a)           Fuel (Account 501).

 

(b)           Scrubber reactantexpenses in Steam Expenses (Account 502).

 

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1.19.        Good Utility Practice.

 

At aparticular time, any of the practices, methods, and acts, which, in theexercise of reasonable judgment in the light of the facts known at the time thedecision was made, would have been expected to accomplish the desired result orfurther the possibility of achieving such result, at a reasonable costconsistent with reliability and safety and all applicable laws and governmentalrules, regulations, and orders pertaining to Trimble County Plant. Suchpractices, methods, and acts shall include, but shall not be limited to, any ofthe practices, methods, and acts engaged in or approved by other members of theelectric utility industry at, prior to, or subsequent to the time the decisionwas made. Good Utility Practice is not intended to be limited to the optimumpractice, method, or act to the exclusion of all others, but rather to be anumber of possible practices, methods, or acts.

 

1.20.        Incremental Capital Assets.

 

All assets ofthe Trimble County Plant pertaining to the use of Trimble County Unit 1 whichare not included in Accounts 101, 106, or 107 of the Uniform System of Accountson the Commercial Operation Date, or such later date as is necessary tocomplete the original construction of Trimble County Unit 1 and the TrimbleCounty General Plant Facilities and the Trimble County Site as they pertain toTrimble County Unit 1.

 

1.21.        Insurance.

 

Policies ofinsurance of any type procured and maintained, including any self-insurancemaintained by Louisville or jointly by the Parties, relating to Trimble CountyUnit I on and after its Commercial Operation Date, in accordance with Article13 hereof.

 

1.22.        Interconnection Agreement.

 

The agreementbetween Louisville and IMPA as such agreement may be amended from time to time,providing for purchases and sales of electric capacity and energy between theParties, and specifying the rates to be charged for such transactions as filedwith the Federal Energy Regulatory Commission (“FERC”).

 

1.23.        InternalLoad.

 

Aggregateelectric demand of all retail consumers served, including those served undernon-firm (interruptible) rate schedules, and associated transmission anddistribution losses.

 

1.24.        Joint Transmission System.

 

The JointTransmission System shall be the transmission facilities owned and jointlyoperated by PSI Energy (“PSI”), IMPA, and Wabash Valley Power Association

 

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(“WVPA”)functionally serving as transmission facilities, all having an operatingvoltage of 69,000 volts or higher.

 

1.25.        Louisville’s Cost Of Capital.

 

An amountdetermined by the weighted average cost of capital based on Louisville’scapital structure at the end of the prior month, including short-term debt,long-term debt, preferred stock, and common equity. The cost rates forshort-term debt, long-term debt, and preferred stock shall be determined basedon the average embedded cost at the end of the prior month. The cost of commonequity shall be based upon the rate of return on common equity allowed by theKentucky Public Service Commission, or its successor, by its Order inLouisville’s last general rate case.

 

1.26.        Net Electric Generating Capability AndAssociated Electric Energy.

 

The maximumcontinuous ability of Trimble County Unit 1 to produce power which can beavailable at any particular time, less any power required for operation of theunit, taking into account all relevant conditions and factors affecting orlimiting the capability of the unit to produce power at such time, including,without limitation, availability and quality of fuel, any mechanical or otherdefects, breakdowns, malfunctions, or environmental and permit limitations thenexisting.

 

1.27.        Net Seasonal Capability.

 

The steadyhourly output, less auxiliary usage, which generating equipment is expected toproduce under ideal conditions, and adjusted due to seasonal variations inambient temperature, condensing water availability and/or temperature,reservoir levels, scheduled reservoir discharge, river flow head, etc. Suchoutput shall be declared on a monthly basis and determined according to testingcriteria defined in the East Central Area Reliability Coordination Agreement’sDocument No. 4 entitled, “Criteria and Method For the Uniform Rating ofGenerating Equipment.”

 

1.28.        OperatingWork.

 

Allengineering, contract preparation, purchasing, repair, supervision,recruitment, training, expediting, inspection, accounting, testing, protection,operating, management, maintenance, and all other work and activitiesassociated with operating Trimble County Unit 1 which are not included inConstruction Work, but excluding all work on any Incremental Capital Assets.

 

1.29.        Owners.

 

The Partiesand Illinois Municipal Electric Agency (“IMEA”).

 

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1.30.        Representative.

 

A Party’smember of the Coordination Committee as set forth in Article 18 of thisAgreement.

 

1.31.        Trimble County General Plant Facilities.

 

Facilities onthe Trimble County Site, excluding those in which an interest is conveyed asidentified in Appendix B, which are necessary for use by IMPA with respect toits proportional ownership of Trimble County Unit 1, for which IMPA shall havea non-exclusive license, substantially in the form shown in Appendix C, to useconsistent with its ownership interests. Ownership in such facilities is notconveyed to IMPA hereunder. Such facilities are identified in Appendix Chereto, and in the absence of other units at the Trimble County Site, all suchfacilities shall be considered to pertain to the use of Trimble County Unit 1.

 

1.32.        Trimble County Plant.

 

The generatingplant at a site along the Ohio River at river mile 571.4 at Wises Landing inTrimble County, Kentucky, which plant currently consists of a single coal-firedsteam electric generating unit of 495,000 kilowatts, and includes TrimbleCounty Unit 1, the Trimble County General Plant Facilities, and the TrimbleCounty Site.

 

1.33.        Trimble County Site.

 

Certain land,consisting of approximately 2,200 acres, and certain rights in land owned byLouisville, including the land on which Trimble County Unit 1 is constructedand including that portion of the land underlying Trimble County Unit 1 whichis conveyed to IMPA under Article 2.2 hereof. In the absence of other units atthe Trimble County Site, all such land shall be considered to pertain to theuse of Trimble County Unit 1.

 

1.34.        Trimble County Unit 1.

 

The 495,000kilowatt unit, located at the Trimble County Site, consisting of the propertyset forth in Appendix B hereto.

 

1.35.        Uniform System Of Accounts.

 

The FERC’s“Uniform System of Accounts Prescribed for Public Utilities and Licensees(Class A and Class B)”, in effect as of the date of this Agreement, as suchUniform System of Accounts may be modified from time to time. References inthis Agreement to any specific account number shall mean the account number ineffect as of the Execution Date of this Agreement or any successor account.

 

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**ARTICLE 2.**

**OWNERSHIPINTEREST AND SALE**

 

2.1.          Ownership Interests.

 

Trimble CountyUnit 1 shall be owned by the Parties and IMEA as tenants in common. Theundivided ownership interest of each Party and IMEA in Trimble County Unit 1shall be free and clear of the lien of any indenture of mortgage, deed oftrust, bond resolution, or other instrument (hereinafter called “indenture”)establishing a lien upon some or all of the property of the other Party orIMEA. The undivided ownership interests of Louisville, IMPA, and IMEA inTrimble County Unit 1 shall be 75.00, 12.88, and 12.12 percent, respectively.Trimble County Unit 1 is more specifically described in Appendix B attachedhereto which may be revised from time to time in accordance with thisAgreement. Louisville shall retain full ownership of the Trimble County GeneralPlant Facilities as described in Appendix C attached hereto, subject to thenon- exclusive licenses granted to IMPA hereunder and to IMEA. Louisville shallretain full ownership of the Trimble County Site except for that portion of theTrimble County Site conveyed to IMPA pursuant to Article 2.2, and except forthat portion of the Trimble County Site previously conveyed to IMEA, andsubject to the reciprocal easements over the Trimble County Site conveyed toand by Louisville, IMPA, and IMEA.

 

It isrecognized by the Parties, however, that various items of property included inTrimble County Unit 1 may be leased from others in lieu of purchasing suchitems of property. Nothing in this Agreement shall preclude the Parties fromleasing such items of property. Such leased property shall be held by theOwners in an undivided ownership as tenants in common.

 

2.2.          Sale Of Property Included In TrimbleCounty Unit 1.

 

At theClosing, from its ownership share of Trimble County Unit i~ Louisville shallsell and convey to IMPA, and IMPA shall purchase from Louisville, a 12.88percent undivided ownership interest as a tenant in common in Trimble CountyUnit 1 as set forth in Appendix B. Upon such conveyance, the undividedownership shares of Trimble County Unit 1 shall be as follow: Louisville.  75 percent, IMPA- 12.88 percent, IMEA- 12.12percent. Such conveyance shall be by Bill of Sale substantially in the formshown in Appendix A attached hereto and made a part hereof

 

From itsownership share of the Trimble County Site, Louisville shall further convey toIMPA by general warranty deed, substantially in the form shown in Appendix E,an undivided ownership interest in 12.88 percent of that portion of the realestate constituting the Trimble County Site underlying Trimble County Unit 1 tobe held is tenants in common. Upon such conveyance, the undivided ownershipshares of that portion of the real estate constituting the Trimble County Siteunderlying Trimble County Unit 1 shall be as follow: Louisville75 percent, IMPA 12.88 percent, IMEA . 12.12 percent.

 

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Louisvilleshall further grant to IMPA a nonexclusive license, substantially in the formshown in Appendix C, to use the Trimble County General Plant Facilities and anon-exclusive easement, substantially in the form shown in Appendix F, overthat portion of the Trimble County Site owned by Louisville, as the TrimbleCounty- General Plant Facilities and the Trimble County Site pertain to IMPA’suse of Trimble County Unit 1. IMPA shall rant to Louisville and any otherOwners of Trimble County Unit 1 an easement, substantially in the form shown inAppendix G, over IMPA’s interest in the Trimble County Site.

 

Further, afterthe Closing, the Parties shall execute such other instruments, if any, as maybe necessary or appropriate to confirm the respective rights and interests ofthe Parties hereunder and to maintain their respective ownership interests.

 

2.3.          Release From Lien Of Louisville’sIndenture.

 

At theClosing, Louisville shall furnish to IMPA a properly executed release of thatportion of the property being conveyed to IMPA at the Closing from the lien ofany and all indentures, applicable to Louisville’s property conveyed to IMPAhereunder.

 

2.4.          Closing.

 

The Closingshall be held in accordance with the provisions of Article 3.

 

2.5.          Additional Generating Units.

 

Subject toArticle 15 hereof, Louisville shall have the sole and exclusive right to own,install, enlarge, modify, and operate any generating unit or units other thanTrimble County Unit 1, as well as any other facility, including necessaryappurtenances thereto, on the Trimble County Site, provided that such otherunits or facilities shall not be so installed, enlarged, modified, and operated,as the case may be, as to unreasonably impair (economically or operationally)the operation of Trimble County Unit 1.

 

2.6.          Modification Of Existing Property.

 

Subject to theapproval of the Coordination Committee, and in accordance with the terms ofthis Agreement, Louisville shall have the right to use, enlarge, modify, orrelocate any facilities installed as a part of Trimble County Unit 1 or TrimbleCounty General Plant Facilities in connection with the installation,enlargement, modification, or operation, as the case may be, of such other unitor units or facilities provided that:

 

(a)           such use, enlargement,modification, or relocation of Trimble County Unit 1 facilities or TrimbleCounty General Plant Facilities shall not unreasonably impair (economically oroperationally) the operation of Trimble County Unit 1; and

 

(b)           the cost of such use,enlargement, modification, or relocation of Trimble County Unit 1 facilities orTrimble County General Plant Facilities, in connection with such other unit orunits or facilities, shall be borne by Louisville (except that if such use,

 

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enlargement,modification, or relocation of Trimble County Unit 1 facilities or TrimbleCounty General Plant Facilities is in connection with the installation,enlargement, modification, or operation of any additional unit or units orfacilities which are owned or to be owned by the Owners in common, then thecost of such use, enlargement, modification, or relocation of said TrimbleCounty Unit 1 facilities or Trimble County General Plant Facilities shall beshared by the Owners in proportion to their respective ownership interests insuch additional unit or units or facilities); and

 

(c)           such action shall notenlarge or diminish the respective ownership interests of the Owners in anypart of Trimble County Unit 1; and

 

(d)           such action shall notenlarge or diminish the Owner’s respective obligations to share in the costs ofany part of Trimble County Unit 1; and

 

(e)           further, wheremodification of existing property and rights requires revisions to existingdocuments setting forth the respective rights and interests of the Owners, orwhere new conveyances are required to properly effectuate the modifications toproperty and rights made hereunder, the Parties agree to cooperate to promptlyexecute and deliver such documents.

 

**ARTICLE 3.**

**PURCHASE, PAYMENT, AND CLOSING**

 

3.1.          Purchase Price.

 

The purchaseprice for IMPA’s 12.88 percent undivided ownership interest in Trimble County Unit1 shall be $91,075,617 (the amount established pursuant to the Option Agreementof December 30, 1991, between the Parties) (the “Purchase Price”), paid atClosing in immediately available funds.

 

3.2.          Closing.

 

3.2.1.                       Date And Place.

 

Provided thatthe conditions in Article 3.3 hereof have been fulfilled, Closing shall occurat such location as may be selected by the Parties, on such date as set forthin the Option Agreement, or on such other date as mutually agreed upon by theParties.

 

3.2.2.                       Delivery Of Documents, Certificates, AndFunds.

 

At theClosing, Louisville shall deliver to IMPA the Bill of Sale, deed, easement,license, the release of any and all indentures of the ownership interest inTrimble County Unit 1 to be conveyed to IMPA hereunder at the Closing from thelien of such indenture(s), and all certificates and evidences ofauthorizations, approvals, and documents as provided for herein. IMPA shalldeliver to Louisville the Purchase Price at the Closing, in immediatelyavailable funds and all certificates, easements, and evidences ofauthorizations, approvals, and documents as provided for herein.

 

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3.3.          Special Conditions.

 

IMPA’sobligation to complete the transaction as contemplated in this Article shall besubject to the fulfillment, prior to Closing, of each of the following specialconditions:

 

(a)           IMPA shall haveexercised the Option set forth in the Option Agreement of December 30, 1991,between the Parties.

 

(b)           IMPA shall have obtainedentitlement or contractual authority and any required regulatory approval forthe use of such transmission system or systems as are necessary to transmitpower and energy from the Delivery Points to IMPA.

 

(c)           IMPA shall have issuedand sold tax-exempt bonds sufficient in amount to pay for any and all sums dueto be paid by IMPA to Louisville at Closing.

 

(d)           The Parties shall haveexecuted the Interconnection Agreement.

 

IMPA shallendeavor in good faith to fulfill each of these special conditions as soon asreasonably practicable. In the event IMPA determines that it cannot fulfill thesale of tax-exempt bonds, it shall notify Louisville. IMPA shall regularlyreport on its progress to Louisville.

 

Should IMPAfail or be unable to close by Closing due to its inability to meet thesespecial conditions, the Agreement shall terminate without penalty to eitherParty.

 

3.4.          Continued Marketing By Louisville.

 

IMPAunderstands and acknowledges that Louisville may incur certain costs shouldClosing not occur. IMPA shall undertake to keep Louisville promptly andadequately informed of its efforts and progress toward satisfying theconditions set forth in Article 3.3 above, as well as any event, situation, oroccurrence which could adversely affect IMPA’s ability or decision to close asscheduled. In this regard, IMPA shall regularly, no less frequently thanmonthly, report on its efforts and progress, and shall declare its intention toclose as scheduled.

 

Except asotherwise specifically provided in this Agreement, IMPA also understands andacknowledges that Louisville, in its sole discretion, reserves the right tosell prior to and subsequent to the Closing, all or any portion of TrimbleCounty Unit 1 or the output thereof, including the Trimble County General PlantFacilities and the Trimble County Site, other than the portion to be conveyedto IMPA hereunder.

 

3.5.          Termination If Closing Does-Not Occur.

 

Should Closingnot occur at the time set for Closing under Article 3.2.1 due to any default orfailure to satisfy any condition or contingency by IMPA, this Agreement shallimmediately terminate with Louisville having no further obligation or liability

 

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hereunder. Insuch event, the Unit Power Purchase Agreement of December 30, 1991, betweenLouisville and IMPA, shall remain in full force and effect.

 

**ARTICLE 4.**

**REPRESENTATIONS, WARRANTIES,AND MUTUAL COVENANTS**

 

4.1.          IMPA Representations.

 

IMPA herebyrepresents and warrants to Louisville as of the Closing as follows:

 

4.1.1.                       IMPA Organization.

 

IMPA is a bodycorporate and politic and a political subdivision of the State of Indiana, dulyorganized, validly existing and in good standing under the laws of the State ofIndiana, has the full power, legal capacity, and authority to enter into thisAgreement and related agreements, and to carry out the transactionscontemplated by this Agreement, and to carry on its business as it is now beingconducted and as it is contemplated to be conducted after the Closing. IMPA hasdelivered to Louisville on or before the Closing a true and complete copy ofits Statement of Organization and By-Laws as amended to date.

 

4.1.2.                       Authority Relative To This Agreement.

 

The execution,delivery, and performance by IMPA of this Agreement have been duly authorizedby all necessary corporate action on the part of IMPA, and the execution,delivery, and performance by IMPA of the Interconnection Agreement will havebeen duly authorized by all necessary corporate action on the part of IMPA priorto Closing. The execution, delivery, and performance by IMPA of this Agreementand the Interconnection Agreement do not contravene any law, or anygovernmental rule, regulation, or order, applicable to IMPA or its properties,or the Statement of Organization or By-Laws of IMPA and do not and will notcontravene the provisions of, or constitute a default under, any indenture,mortgage, contract, or other instrument to which IMPA is a party or by whichIMPA is bound, and this Agreement constitutes a legal, valid, and bindingobligation of IMPA, enforceable in accordance with its terms, except as limitedby applicable bankruptcy, insolvency, reorganization, or similar laws at thetime in effect.

 

4.1.3.                       Approvals And Consents.

 

Any consent orapproval of, giving of notice to, registration with, or taking of any otheraction by any state, federal, or other governmental commission, court, agency,or regulatory authority including, without limitation, the Indiana UtilityRegulatory Commission, the Federal Energy Regulatory Commission, and theSecurities and Exchange Commission, in connection with the execution, delivery,and performance of this Agreement and the Interconnection Agreement required tobe obtained by IMPA on or before the Closing will have been obtained by theClosing.

 

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4.1.4.                       Legal Proceedings.

 

There is nomaterially adverse legal action, suit, arbitration, governmental investigation,or other legal or administrative proceeding, or any order, decree, or judgmentin progress, pending or in effect, or to the knowledge of IMPA threatenedagainst or relating to IMPA in connection with or relating to the transactionscontemplated by this Agreement, and IMPA does not know or have any reason to beaware of any basis for the same.

 

4.2.          Louisville Representations.

 

Louisvillehereby represents and warrants to IMPA as of the Closing as follows:

 

4.2.1.                       Louisville Organization.

 

Louisville isa corporation duly organized and validly existing under the laws of theCommonwealth of Kentucky, and has corporate power to carry on its business asit is now being conducted and as it is contemplated to be conducted after theClosing. Louisville has delivered to IMPA on or before the Closing a true andcomplete copy of its Articles of Incorporation and By-Laws as amended to date.

 

4.2.2.                       Authority Relative To This Agreement.

 

The execution,delivery, and performance by Louisville of this Agreement and theInterconnection Agreement have been duly authorized, or by Closing, will beratified by all necessary corporate action on the part of Louisville, do notcontravene any law, or any governmental rule, regulation, or order, applicableto Louisville or its properties, or the Articles of Incorporation or By-Laws ofLouisville and do not and will not contravene the provisions of, or constitutea default under, any indenture, mortgage, contract, or other instrument towhich Louisville is a party or by which Louisville is bound, and this Agreementconstitutes a legal, valid, and binding obligation of Louisville, enforceablein accordance with its terms, except as limited by applicable bankruptcy,insolvency, reorganization, or similar laws at the time in effect.

 

4.2.3.                       Approvals And Consents.

 

Any consent orapproval of, giving of notice to, registration with, or taking of any otheraction by any state, federal, or other governmental commission, court, agency,or regulatory authority including, without limitation, the Kentucky PublicService Commission, the Federal Energy Regulatory Commission, and theSecurities and Exchange Commission, in connection with the execution, delivery,and performance of this Agreement and the Interconnection Agreement required tobe obtained by Louisville on or before the Closing will have been obtained bythe Closing.

 

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4.2.4.                       Legal Title.

 

Louisville hasgood and marketable title to the assets conveyed to IMPA free and clear of allliens, except easements, restrictions, . and stipulations of record, and thelien of current real property taxes not delinquent, subject to the rights ofIMEA which owns a 12.12 percent undivided interest as tenants in common to theassets conveyed. Before Closing, Louisville shall provide to IMPA a list of alleasements, restrictions, and stipulations of record. Within thirty daysthereafter, IMPA shall consent to such easements, restrictions, andstipulations of record, which consent shall not unreasonably be withheld, if itreasonably determines that the easements, restrictions, and stipulations ofrecord will not adversely affect the marketability of said title. Should IMPAreasonably refuse to consent to any such easement, restriction, or stipulationof record, Louisville, at its option and at its expense, may (I) remove sucheasement, restriction, or stipulation of record from the property, or (ii)remove the limiting language “except easements, restrictions, or stipulationsof record’ from the representation of good and marketable title in thisArticle, and convey good and marketable title subject only to current taxes notdelinquent, or (iii) purchase standard form title insurance with respect to thereal estate to be conveyed herein in favor of IMPA, which title insurance, ifobtainable, will insure over any easement, restriction, or stipulation ofrecord adversely affecting marketability of said title, reasonably objected toby IMPA. If title insurance is obtained under this provision in favor of IMPA,Louisville shall be responsible for the cost of such title insurance coveringthe real estate conveyed to IMPA, up to a maximum of $5,000.00, with IMPA beingresponsible for the cost of such insurance above $5,000.00.

 

4.2.5.                       Condition Of Plant And Equipment.

 

As of theClosing Date, the portions of the Trimble County Plant pertaining to theoriginal construction of Trimble County Unit 1 are capable of full operation,according to their design and specifications, except as set forth in acertificate in the form attached as Appendix D hereto.

 

4.2.6.                       Legal Proceedings.

 

There is nomaterially adverse legal action, suit, arbitration, governmental investigation,or other legal or administrative proceeding, or any order, decree, or judgmentin progress, pending or in effect, or to the knowledge of Louisville threatenedagainst or relating to Louisville in connection with or relating to thetransactions contemplated by this Agreement, and Louisville does not know orhave any reason to be aware of any basis for the same.

 

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**ARTICLE 5.**

**OPERATING ARRANGEMENTS**

 

5.1.          Authority For Operation And Management.

 

Subject to anydirections from the Coordination Committee, Louisville shall have soleauthority to manage, control, maintain, and operate (including dispatch)Trimble County Unit 1 for the benefit of each Party’s respective interest andLouisville shall take all steps which it deems necessary or appropriate forthat purpose. Louisville shall discharge such authority in accordance with GoodUtility Practice and the other provisions of this Agreement.

 

5.2.          Scheduling And Dispatching Of ElectricGeneration

 

When TrimbleCounty Unit 1 is~ Available, IMPA shall have the right to schedule, subject tothe scheduling provisions herein, all, or any part that is five (5) megawattsor greater, of its Electric Capability and Energy Entitlement in Trimble CountyUnit 1 (or as such Electric Capability and Energy Entitlement may be modifiedherein); provided, that during periods when Trimble County Unit 1 is beingoperated at minimum generation, IMPA, unless otherwise agreed to by Louisville,shall not schedule less than what its Electric Capability and EnergyEntitlement in Trimble County Unit 1 would have been had the Net ElectricGenerating Capability and Associated Electric Energy of Trimble County Unit 1been restricted to such minimum generation. Louisville shall promptly notifyIMPA of any significant change in the Net Electric Generating Capability ofTrimble County Unit 1. As used in this paragraph, the term “minimum generation’means the Net Electric Generating Capability level below which Trimble CountyUnit 1 cannot operate in a stable manner and must be shut down.

 

Louisville andIMPA shall each be entitled to dispose of their respective Electric Capabilityand Energy Entitlement through scheduled transactions with other electricutilities in a manner consistent with Good Utility Practice.

 

IMPA shallschedule Electric Energy to be delivered pursuant to this Agreement prior to12:00 noon E.S.T. of the day prior to delivery; provided that, for Saturdays,Sundays, Mondays, and holidays recognized by Louisville, IMPA shall schedulethe Electric Energy prior to 12:00 noon E.S.T. on the last normal work dayprior to the weekend or holiday. : Schedules shall be subject to change after12:00 noon E.S.T. of the applicable day on which the schedule is submitted onlyupon the mutual consent of the Parties, but Louisville shall make everyreasonable effort to accommodate changes in the schedules. All schedules shallbe in increments of whole megawatts; provided, that where IMPA’s fullentitlement is requested and available, IMPA shall be entitled to its fullElectric Capability and Energy Entitlement. Prior to each calendar year,Louisville shall notify IMPA of the holidays to be recognized by Louisville forthat year. In the event Louisville fails to provide such notice, the saidholidays shall be the same as for the prior year.

 

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Louisvillewill provide to IMPA, by 9:00 A.M. each day, the Net Electric GeneratingCapability expected for the next day; provided that, for Saturdays, Sundays,Mondays, and holidays recognized by Louisville, Louisville will provide thisinformation on the last normal work day prior to the weekend or holiday. At alltimes, Louisville will immediately inform IMPS of any increase or decrease inunit Net Electric Generating Capability that will or may occur, or anysuspected conditions that could cause such change.

 

At any timeIMPA is not requesting, for any reason, including a claim by 1MPA of ForceMajeure, the maximum amount of Net Electric Generating Capability available toit from Trimble County Unit 1, Louisville shall have the right to utilize, forits own use, ail or any part of the Electric Energy associated with such unusedNet Electric Generating Capability. When so utilized, the energy consumed byLouisville shall be referred to as “Banked Energy.’ At a future date, IMPAshall be entitled to request, in accordance with the scheduling provisions ofArticle 5.2, Electric Energy associated with the Net Electric GeneratingCapability from Louisville’s portion of Trimble County Unit 1 in an amountequal to all or any portion of the then-current balance of Banked Energy due toIMPA. Louisville shall be obligated to supply the requested amount of IMPA’sBanked Energy unless, pursuant to guidelines established by the CoordinationCommittee, conditions are unsuitable to do so. Pursuant to procedures andguidelines established by the Coordination Committee, the balance of BankedEnergy owed to IMPA shall be periodically returned to zero. When Banked Energyis used by Louisville or returned to IMPA, the Fuel/Reactant Operation Expensesfor the Electric Energy associated therewith shall be assumed by the Partyusing such Electric Energy. Louisville shall maintain records adequate todetermine the transactions related to, and balances of, Banked Energy.

 

Louisvilleshall submit to IMPA, as far in advance as practicable, schedules showing theexpected time and duration for maintenance and repair outages of Trimble CountyUnit 1. Louisville will adjust such schedules to accommodate IMPA’s operatingneeds, where, in Louisville’s sole judgment, it is practicable to do so,consistent with Good Utility Practice. Should IMPA desire a schedule formaintenance and repair outages which Louisville believes is impracticable, IMPAshall be entitled to raise the scheduling issue with the CoordinationCommittee.

 

5.3.          Economic Replacement Of Trimble CountyUnit 1 Energy.

 

In the event,and only in the event, Louisville voluntarily ceases to operate Trimble CountyUnit 1 or reduces the output therefrom solely because of the availability ofElectric Energy to Louisville from other sources, the cost of which isprojected to be lower than what the cost of Fuel/Reactant Operation Expenses ofElectric Energy generated by Trimble County Unit 1 would be during the periodof such cessation in operation, Louisville shall make available to IMPAreplacement Electric Energy from such other sources during the period of suchcessation in operation. The amount of such replacement Electric Energy to bemade available to IMPA during such period shall be the amount of ElectricEnergy requested by IMPA during such period, but not in excess

 

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of the amountto which IMPA would have been entitled during such period had the operation ofTrimble County Unit 1 not ceased or the output not been reduced. The perkilowatt-hour cost of such replacement Electric Energy shall be the perkilowatt-hour cost incurred by Louisville for such replacement Electric Energyobtained from such other sources during such period.

 

5.4.          Electric Capability And EnergyEntitlements.

 

Louisville andIMPA shall be entitled to the Net Electric Generating Capability and AssociatedElectric Energy of Trimble County Unit 1 in proportion to their respectiveownership interests in Trimble County Unit 1; however, the Net ElectricGenerating Capability of Trimble County Unit 1 shall not exceed the applicableNet Seasonal Capability of Trimble County Unit 1, except under criteria as maybe established by the Coordination Committee. These entitlements shall begin at the time of Closing and continue untilTrimble County Unit 1 ceases to be used for the generation of Electric Energy. 

 

5.5.          Operations Management.

 

5.5.1.                       Administration Of Operating Work AndIncremental Capital Assets.

 

Louisvilleshall perform all work, or execute, and enforce (including any renegotiationand settlement) all contracts, contractual obligations and arrangements forOperating Work and Incremental Capital Assets, including, without limitation,any and all warranties on equipment, facilities, materials, and servicesfurnished pursuant to any such contracts. Warranties and claims arising underthis Article shall be administered in accordance with the provisions of Article5.5.6 of this Agreement.

 

5.5.2.                       Purchasing Necessary Goods And Services.

 

Louisvilleshall purchase and procure, through and from any source it may select, theequipment, apparatus, machinery, tools, services, materials and supplies, andemergency spare parts necessary for the performance of Operating Work andIncremental Capital Assets.

 

5.5.3.                       Procurement Of Fuel.

 

At all times,Louisville shall make necessary and reasonable efforts to maintain an adequatesupply of fuel. At IMPA’s request, Louisville will receive bids or proposalsfrom suppliers of Indiana coal who wish to be considered for purchases of coalsupplies for Trimble County Unit 1. Louisville shall have no obligation toconsider any particular bid or proposal, which in Louisville’s sole judgment,is not in the best interest of the Owners when considering price, reliability,quality, and other relevant terms, conditions, and considerations. IMPA mayelect from time to time to purchase fuel directly for use in connection withits share of Trimble County Unit I pursuant to fuel specifications andprocedures for delivery, handling, testing, and use as approved by Louisville.In such case, IMPA shall contract and pay directly to suppliers and billingunder this Agreement

 

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shall beadjusted appropriately. IMPA shall be responsible for all its costs resultingfrom these separate fuel procurement activities, and for any additional costsimposed upon the other Owners where such additional costs result fromactivities not performed by or under the direct supervision of Louisvillepursuant to this Agreement.

 

5.5.4.                       Expenditure Of Funds.

 

Louisvilleshall expend funds in accordance with the terms and conditions of thisAgreement.

 

5.5.5.                       Insurance.

 

Louisvilleshall arrange for the placement and maintenance of Insurance, as providedherein in Article 13.

 

5.5.6.                       Enforcement Of Claims Against ThirdParties.

 

Louisvilleshall present and prosecute known claims against third parties, including butnot limited to claims against insurers and indemnitors providing Insurance orindemnities with respect to any loss of or damage to any property of TrimbleCounty Unit 1, or the Trimble County General Plant Facilities or the TrimbleCounty Site as they pertain to Trimble County Unit 1, or any interest of theOwners pertaining thereto, and with respect to any liability of Louisville orIMPA to third parties covered by Insurance or indemnity agreement. To theextent that such loss, damage, or liability is not covered by Insurance or byany indemnity agreement, Louisville shall present and prosecute claims thereforagainst any parties who may be liable therefor. Nothing herein shall require Louisvilleto initiate, present, or prosecute any claim which, in its sole judgment, iswithout sufficient merit to warrant such enforcement, or otherwise isinconsistent with the Owners’ general business interests. Nothing herein shallrequire Louisville to invoke any certain type of enforcement procedure, or toseek, or to continue to seek, enforcement of any claim, when in Louisville’ssole judgment, the Owners’ general business interests are better served bysettling or withdrawing such claim. If any such claim by the Owners is inexcess of $250,000 in amount, Louisville shall notify IMPA of the existence andnature of such claim and shall also notify IMPA if and when any settlement ofsuch claim is accomplished by Louisville.

 

In the eventthat Louisville should fail or refuse to diligently prosecute any claim,nothing herein contained shall prevent IMPA from prosecuting such claim ordemand in its own name, to the extent of, and as such claim or demand affects,its interest.  IMPA may intervene in anysuit on a claim pursuant to this Article as an additional plaintiff ordefendant to assert or defend as to its respective ownership interest andrights. Cost and monies net of reasonable expenses recovered are to be sharedby the Owners in proportion to their respective ownership interests in TrimbleCounty Unit 1.

 

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5.5.7.                       Processing Claims By Third Parties.

 

Louisvilleshall investigate, adjust, defend, and settle claims by third parties againstIMPA and Louisville, arising out of or attributable to Operating Work orIncremental Capital Assets, or the past or future performance or nonperformanceof the obligations and duties of either IMPS or Louisville under or pursuant tothis Agreement, including but not limited to any claim resulting from death orinjury to persons or damage to property, when such claims are not covered byvalid and collectible Insurance carried by Louisville or IMPA and, whenever andto the extent reasonable, present and prosecute claims against any third party,including insurers, for any costs, losses, and damages incurred in connection’with such claims. If tiny such claim against IMPS and Louisville is in excessof $50,000 in amount and is not covered by valid and collectible Insurancecarried by Louisville or 1MPA, Louisville shall notify IMPA of the existenceand nature of such claim and shall also notify IMPA if and when any settlementof such claim is accomplished by Louisville. Settlement of claims in excess of$1,000,000 shall be reported to and approved by the Coordination Committee.

 

In the eventthat Louisville should fail or refuse to diligently defend any claim, nothingherein contained shall prevent IMPA from defending such claim or demand in itsown name, to the extent of, and as such claim or demand affects, its interest.IMPA may intervene in any suit on a claim pursuant to this Article as anadditional party to defend as to its respective ownership interests and rightsin Trimble County Unit 1.

 

5.5.8.                       Delivery Of Operating data.

 

As promptly aspracticable after the end of each month, Louisville shall render to IMPA astatement setting forth appropriate operating data as may be needed for reportsand records.

 

5.6.          Environmental Laws and Regulations.

 

Each Partyshall be responsible for its own share of any obligations, costs, or burdens ofany kind, resulting from any federal, state, or local environmental law,regulation, or requirement, as amended from time to time. Similarly, each Partyshall be entitled to its share, on a pro rata ownership basis, of any rights,credits, or entitlements associated with such law, regulation, or requirement.Louisville’s obligation to produce generation from IMPA’s share of ThimbleCounty Unit 1, as well as Louisville’s obligation to produce backup power andenergy as set forth in Article 10 hereof, shall be conditioned upon IMPA’scompliance with such laws, regulations, or requirements as set forth in thisArticle, and IMPA’s possession of required environmental allowances needed forsuch generation. In the event IMPA’s rights, credits, or entitlements fromTrimble County Unit 1 or other sources are not sufficient to allow the desiredlevel of generation from IMPA’s share of Trimble County Unit 1 or theproduction of backup power and energy, Louisville shall provide such rights,credits, or entitlements to IMPA upon IMPA’s request and after consultationwith IMPA concerning the availability and cost of such rights, credits, orentitlements. Louisville shall have no obligation, however,

 

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to providesuch rights, credits, or entitlements where such rights, credits, orentitlements are required for use by Louisville to serve its Internal Load, orany firm off-system sales existing prior to any request for backup power andenergy, or backup power and energy to IMEA. Louisville may satisfy thisobligation, at its option, by supplying such rights, credits, or entitlementsfrom its own system, or by purchasing from other sources. Such obligation shallbe limited to the rights, credits, or entitlements necessary to operate IMPA’sportion of Trimble County Unit 1 at the lower of an 80 percent Capacity Factoror IMPA’s actual Capacity Factor, and shall apply only to the excessrequirements above the rights, credits, or entitlements obtained by IMPA as aresult of its ownership Interest in Trimble County Unit 1 or from othersources.

 

IMPA shallcompensate Louisville for providing such allowances for IMPA’s Trimble CountyUnit 1 generation, as well as for allowances for backup power and energy soldby Louisville to IMPA under Article 10 hereof, at a price equal to the fairmarket value of such allowances, as such value may change from time to time.Fair market value and procedures for billing and payment will be determinedaccording to criteria set forth by the Coordination Committee; provided that,fair market value shall not be less than

 

Louisville’sactual cost of providing or obtaining such allowances. In lieu of compensationunder this Article for such allowances, where agreed by the Parties, suchcompensation may be accounted for by inclusion in the price for backup powerpursuant to the Interconnection Agreement between the Parties.

 

5.7.          Indemnification Of Environmental FinesAnd Penalties.

 

Louisvillewill indemnify IMPA against administrative fines and civil penalties arisingout of the operation of the Trimble County Plant imposed for violations ofapplicable environmental laws and regulations, resulting from acts ofLouisville as plant operator. Exclusions from this special indemnificationshall include operation and maintenance costs which might be incurred as aresult of environmental laws and regulations, Incremental Capital Assetsincurred in environmental compliance, occurrences from acts of third parties orfrom equipment failure or malfunction, remedial measures imposed byadministrative agencies for environmental purposes, or reimbursement ofresponse costs under Comprehensive Environmental Response Compensation AndLiability Act (CERCLA) and K.R.S. Chapter 224, and subsequent amendmentsthereof, and any subsequently enacted legislation covering the same subjectmatter as CERCLA and K.R.S. Chapter 224, or to any claims of personal injury orproperty damage.

 

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**ARTICLE 6.**

**INCREMENTAL CAPITAL ASSETS**

 

6.1.          Determination Of Need.

 

TheCoordination Committee shall approve Incremental Capital Assets expected tocost over $250,000. Louisville shall have the authority to make all decisionswith respect to Incremental Capital Assets expected to cost $250,000 or less.Emergency expenditures for Incremental Capital Assets which total in excess of$250,000 in any calendar year shall be submitted to the Coordination Committeefor ratification.

 

6.2.          Estimate Of Costs.

 

Prior tobeginning of work on any Incremental Capital Asset which Louisville expects tocost more than $1,000,000, such estimate shall be furnished by Louisville inreasonable detail to IMPA for use by it in anticipating its financial requirements.Such estimate shall be subject to revision periodically to reflect more currentinformation on such Incremental Capital Asset.

 

6.3.          Responsibility For Costs.

 

Subsequent tothe Closing, the costs of each Incremental Capital Asset shall be borne byLouisville and IMPA in proportion to their respective percentage ownershipinterests in Trimble County Unit 1. The amount incurred for Incremental CapitalAssets during each month shall be included in the monthly billings provided forin Article 8.L IMPA’s share of all Incremental Capital Assets booked duringJanuary 1993, shall not be reflected in the Purchase Price stated in Article3.1 hereof, but shall be included instead in the first monthly billing to IMPAfollowing Closing.

 

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**ARTICLE 7.**

**COMPENSATION**

 

7.1.          Monthly Charges.

 

The Ownerswill share all costs associated with Trimble County Unit 1, and with theThimble County General Plant Facilities and the Trimble County Site as theypertain to Trimble County Unit 1. These costs are set forth below in fivecomponents for billing and accounting purposes. The Parties intend that thesecomponents incorporate all costs which are or could be associated with TrimbleCounty Unit 1, and with the Trimble County General Plant Facilities and theTrimble County Site as they pertain to Trimble County Unit 1. Should, however,any item or category of costs not fall within the technical definitions of anyof the five components, the Parties agree to adjust the billing components soas to include such item or category.

 

Starting atthe Closing, IMPA shall pay a monthly amount equal to the sum of the fivecomponents delineated in Articles 7.1.1, 7.1.2, 7.1.3, 7.1.4, and 7.1.5, asprovided for in Article 8.1.

 

7.1.1.                       Fuel/Reactant Operation Expense.

 

AllFuel/Reactant Operation Expenses of Trimble County Unit 1 will be prorated tothe Parties, according to the net Electric Energy consumed by each Party ascompared to the total net energy generated by Trimble County Unit 1.

 

For purposesof this Article, Fuel/Reactant Operation Expenses shall be allocated to IMPA onthe basis of its loss-adjusted net Electric Energy during the applicable month.This loss-adjusted net Electric Energy shall be calculated by multiplyingIMPA’s actual Trimble County Unit 1 net Electric Energy during the month by aloss factor to be determined using load flow studies or other mutuallyacceptable analyses which, at the request of either Party, but not morefrequently than once every two years, shall be reviewed and shall be adjustedas appropriate.

 

7.2.          Fixed Operation And Maintenance Expenses.

 

A FixedOperation and Maintenance Expenses component shall be shared by the Parties inproportion to their respective percentage ownership interest in Trimble CountyUnit 1.

 

7.2.1.                       Non-Fuel Operating Component.

 

A non-fueloperating component shall be shared by the Parties in proportion to theirrespective percentage ownership interest in Trimble County Unit 1, calculatedmonthly as the sum of the following four items as they relate to Trimble CountyUnit 1, and the Trimble County General Plant Facilities and the Trimble CountySite as they pertain to Trimble County Unit I:

 

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(a) Taxesother than federal and state income taxes (Account 408.1), except that thosecategories of taxes, or payments in lieu thereof, that are directly billed toIMPA by the taxing authority and paid by IMPA, shall not be included in thisitem.

 

(b)Administrative and general expenses (Accounts 920-935) as recorded inLouisville’s accounting records under the Uniform System of Accounts.

 

(c) Leasepayments which result from a third-party financed Incremental Capital Asset.

 

(d) Penalties(Account 426.3), except for those environmental penalties against whichLouisville is indemnifying IMPA under Article 5.7 hereof.

 

7.2.2.                       Working Capital Component.

 

A workingcapital component shall be shared by the Parties in proportion to theirrespective percentage ownership interests in Trimble County Unit 1. Thiscomponent is comprised of the items listed below, to the extent that each ofthese items relates to Trimble County Unit 1, the Trimble County General PlantFacilities (as they pertain to Trimble County Unit 1), and the Trimble CountySite (as it pertains to Trimble County Unit 1). This component shall becalculated by multiplying the beginning monthly balances of the items byLouisville’s Cost of Capital as “grossed up’ for federal and state incometaxes.

 

(a)           Fuel stocks (Account151).

 

(b)           Fuel stock expensesundistributed (Account 152).

 

(c)           Plant materials andoperating supplies (Account 154).

 

(d)           Stores expenseundistributed (Account 163).

 

(e)           Prepayments (Account165).

 

(f)            Miscellaneous deferreddebits (Account 186).

 

7.2.3.                       Transmission Charge.

 

A transmissioncharge to cover transmission of the Electric Energy from Trimble County Unit 1to the Delivery Points shall be assessed according to the Trimble Countyschedule contained in the Interconnection Agreement. Such schedule may bechanged by Louisville from time to time based on revised cost information, butshall continue to be calculated throughout the duration of this Agreementaccording to the same cost of service methodology as was used to support theinitial schedule. Should FERC at any time decline to accept a rate based onsuch methodology, a new rate shall be calculated using approved methodology asclose as possible to the initial methodology such that the original intent ofthe Parties in pricing this service shall be maintained.

 

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**ARTICLE 8.**

**BILLING, PAYMENTS, AND RECORDS**

 

8.1.          Billings By Louisville.

 

As promptly aspracticable, but not more than twelve working days after the end of eachcalendar month during the term of this Agreement, Louisville shall prepare andsend to IMPA a statement, in such detail and with such segregations as may beneeded for operating and accounting records, to indicate monthly amounts dueunder the provisions of this Agreement.

 

8.2.          Payments By IMPA Or Louisville.

 

All billsunder Article 8.1 for amounts owed by IMPA to Louisville shall be due andpayable on the tenth working day following the invoice date. Amounts owing byeither Party to the other under the Interconnection Agreement or under theprovisions of this Agreement, other than under Article 8.1, shall be settled inaccordance with the procedures set forth in such provisions as give rise to theobligations. Interest on unpaid amounts shall accrue at the Agreed Rate fromthe date due until the date upon which payment is made. Payments by IMPA toLouisville based on over billing by

 

Louisvilleshall bear interest at the Agreed Rate beginning on the thirty. first day afterreceipt by Louisville and running until such amount is repaid or credited byLouisville. Unless otherwise agreed upon, a calendar month shall be thestandard monthly period for the purpose of settlements under this Agreement.

 

Should eitherParty withhold payment of any contested amount, the procedure for resolution ofdisputes under Article 19 shall be invoked automatically. Non-payment of anyamount contested in good faith by either Party shall not constitute a defaultunder Article 17 prior to completion of the disagreement procedures underArticle 19. The unpaid Party may contend a default exist! under Article 17, ifpayment continues to be withheld following completion of the disagreementprocedures under Article 19 including arbitration if both Parties have electedto arbitrate.

 

8.3.          Records.

 

Louisvillewill record its accounting information in accordance with generally acceptedaccounting principles, as modified by the requirements or permitted practicesof applicable regulatory authorities. For the purpose of this Agreement, allaccount references are to the Uniform System of Accounts. In the event of anychanges in FERC’s accounting procedures which might result in different chargesthan those contemplated by the Agreement, the Parties will agree upon theappropriate changes to the Agreement to achieve the original intent of theParties, unless otherwise mutually agreed by the Parties.

 

The Partiesshall keep and maintain such records as may be necessary or useful in carryingout this Agreement. Each Party shall keep such records as may be needed to

 

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afford a clearhistory of all transactions under this Agreement and make copies of suchrecords available to the other Party upon request. Each Party shall have theright during normal business hours, but no more often than once each calendaryear, at its own expense, to audit, or cause independent certified publicaccountants of its choice to audit, the accounting and other records relatingto transactions under this Agreement and shall have the right to make copies ofrecords as necessary; provided that IMPA shall not be permitted to retaindocuments which Louisville has designated as confidential or proprietary whereto do so would make such records open records under any applicable “openrecords’ or “public records’ procedure or regulation. All such records shall beconsidered confidential and proprietary business records of the Party thatgenerated the particular record in question. Neither Party shall make use ofrecords of the other Party without the express written consent of such Party,except for disclosure or use which is permitted by this Agreement or whererequired by lawful authority, or for purposes of litigation or alternativedispute resolution procedures.

 

**ARTICLE 9.**

**TRANSMISSION SERVICE**

 

All Electric Energydelivered under this Agreement shall be of the character commonly known asthree-phase sixty-hertz energy, and shall be considered as being delivered atLouisville’s Delivery Points.

 

Obtainingtransmission service for transmitting power under this Agreement fromLouisville’s Delivery Points shall be the sole responsibility of IMPA. If anelectric system or systems, which is not part of the electric systems owned byeither of the Parties, is used to transmit the Net Electric Energy fromLouisville’s delivery Points to IMPA, the cost of such transmission serviceshall be paid by IMPA. Losses which are incurred through such third partytransmission(s) shall be assumed by IMPA.

 

**ARTICLE10.**

**BACKUP POWER AND ENERGY**

 

10.1.        FromLouisville.

 

In any hour ofany month that the Net Electric Generating Capability of Trimble County Unit 1is less than the Net Seasonal Capability, IMPA shall have the option to requestfrom Louisville backup power and energy from Louisville’s other generatingresources. For IMPA to receive this backup power and energy, both of thefollowing conditions must be met:

 

(a)           the amount of backuppower and energy shall not exceed an amount equal to IMPA’s share (based on itspercentage ownership interest in Trimble County Unit 1) of such reduction fromNet Seasonal Capability; and

 

(b)           the amount of backuppower and energy requested, as limited by (a) above, is available fromLouisville’s other generating resources and is not required to serveLouisville’s Internal Load, to honor any firm commitments made by Louisvillefor

 

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off-systemsales existing prior to any particular request for backup power and energy, orto provide backup power and energy to IMEA.

 

Compensationfor backup power and energy will correspond to the demand and energy rateprovisions of the Backup Power service schedule contained in theInterconnection Agreement in effect at the time backup energy is delivered.Nothing in this Agreement shall require Louisville to construct, acquire,expand, or maintain new or existing generating resources for the purpose ofsupplying backup power to IMPA pursuant to this Agreement.

 

10.2.        From Third Parties.

 

In the eventLouisville is unable to provide backup power and energy from its own system,Louisville will, at the request of IMPA, make its best effort to purchasebackup power and energy from another party for resale to IMPA. Louisville willbill IMPA for such purchased backup power and energy according to the terms forsuch third party transactions contained in the Backup Power service schedulecontained in the Interconnection Agreement in effect at the time backup energyis delivered.

 

10.3.        Effective Date Of Backup Power Provision.

 

The provisionsof this Article 10 will become effective at the time of Closing.

 

**ARTICLE11.**

**GENERAL CONDITIONS**

 

11.1.        Cooperation.

 

Louisville andIMPA shall cooperate with each other and provide information as may benecessary to facilitate, among other things, the filing of applications forauthorizations, permits, licenses, or financing and the execution of such otherdocuments as may be reasonably necessary to carry out the provisions of thisAgreement, subject to reasonable protections necessary to preserve each Party’sconfidential or proprietary information.

 

11.2.        Approvals.

 

The Partiesshall use their best efforts to obtain as quickly as possible all requisitegovernmental, regulatory, and judicial approvals, where applicable, of theconsummation of the transactions contemplated herein. To the extent anyprovision of this Agreement prevents IMPA from receiving a favorable tax rulingauthorizing the issuance by IMPA of tax-exempt bonds to finance the purchasecontemplated herein, the Parties agree to negotiate In good faith and cooperatewith each other so as to effectuate sale of such bonds; provided that theforegoing shall not be construed so as to impose any economic detriment orburden or unreasonable condition or obligation on Louisville or any other Ownerof Trimble County Unit 1.

 

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11.3.        Access.

 

Officialrepresentatives of IMPA and their designees, including IMPA’s bond trustee,shall have the right, upon sufficient advance notice to Louisville, to enterupon the Trimble County Site subject to all safety, insurance, and industrialsecurity requirements and the need for efficient operation of Trimble CountyUnit 1.

 

11.4.        Conditions Precedent To Louisville’sObligations Hereunder.

 

Allobligations of Louisville under this Agreement are subject to the fulfillment,prior to or at the Closing, of each of the conditions (or the waiver in writingof such conditions by Louisville) that are delineated in Articles 11.4.1through 11.4.4 and IMPA shall exert its best efforts to cause each such conditionto be fulfilled.

 

11.4.1.                     Accuracy Of IMPA’s Representations AndWarranties.

 

Louisville andIMPA shall not have discovered any material error, misstatement, or omission inthe representations and warranties made by IMPA in this Agreement.

 

11.4.2.                     Capability Of Performance By IMPA.

 

IMPA’srepresentations and warranties contained in this Agreement shall be deemed tohave been made again at and as of the time of the Closing and shall then betrue in all material respects; IMPA shall have performed and complied with allagreements, covenants, and conditions required by this Agreement to beperformed or complied with by it prior to or at the Closing Louisville shallhave been furnished with certificates signed by the principal officer of IMPA,dated the date of the Closing, certifying ii form and substance satisfactory toLouisville to the fulfillment of the foregoing conditions and to the furthereffect that there are no actions, suits, or proceedings pending or, to suchofficer’s knowledge, threatened against or affecting IMPA before any court oradministrative body or agency which would materially adversely affect theability of IMPA to perform its obligations under this Agreement.

 

11.4.3.                     Opinion Of Counsel For IMPA.

 

Louisvilleshall have been furnished with an opinion of counsel for IMPA, which counselshall be satisfactory to Louisville, in form and substance satisfactory toLouisville, dated the date of the Closing, to the effect that:

 

(a)           IMPA is a bodycorporate and politic and a political subdivision of the State of Indiana, dulyorganized and validly existing in good standing under the laws of the State ofIndiana and has the corporate power, legal capacity, and authority to carry onits business as presently conducted and to enter into and perform itsobligations under this Agreement; and

 

(b)           The execution,delivery, and performance by IMPA of this Agreement have been duly authorizedby all necessary corporate action on the part of IMPA, do not

 

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contravene anylaw, or any governmental rule, regulation, or order, applicable to IMPA or itsproperties, or the Statement of Organization, or the By-Laws of IMPA and do notand will not contravene the provisions of, or constitute a default under, anyindenture, mortgage, contract, or other instrument to which IMPA is a party orby which IMPA is bound; and

 

(c)           This Agreement has beenduly executed and delivered by IMPA and constitutes the legal, valid, andbinding obligation of IMPA enforceable in accordance with its respective terms,except as limited by applicable bankruptcy, insolvency, reorganization, orsimilar laws at the time in effect; and

 

(d)           There are no actions,suits, or proceedings pending or, to such counsel’s knowledge, threatenedagainst or affecting IMPA before any court or administrative body or agencywhich might materially adversely affect the ability of IMPA to perform itsobligations under this Agreement; and

 

(e)           Any consent or approvalof, giving of notice to, registration with, or taking of any other action by,any state, federal, or other governmental commission, agency, regulatoryauthority, or court, where applicable, including, without limitation, theIndiana Utility Regulatory Commission, the Federal Energy Regulatory Commission,and the Securities and Exchange Commission, in connection with the execution,delivery, and performance of this Agreement required to be obtained by IMPA onor before the Closing has been obtained.

 

11.4.4.                     Payment Of Funds By IMPA.

 

The portion ofthe Purchase Price required to be paid by IMPA to Louisville at the Closingshall be paid in immediately available funds.

 

11.5.        Conditions Precedent To IMPA’sObligations Hereunder.

 

Allobligations of IMPA under this Agreement are subject to the fulfillment, priorto or at the Closing, of each of the conditions (or the waiver in writing ofsuch conditions by IMPA) that are delineated in Article 11.5.1 through 11.5.3and Louisville shall exert its best efforts to cause each such condition to befulfilled.

 

11.5.1.                     Accuracy Of Louisville’sRepresentations And Warranties.

 

IMPA andLouisville shall not have discovered any material error, misstatement, oromission in the representations and warranties made by Louisville in thisAgreement.

 

11.5.2.                     Opinion of Counsel for Louisville.

 

Louisville’srepresentations and warranties contained in this Agreement shall be deemed tohave been made again at and as of the time of the Closing and shall then betrue in all material respects. Louisville shall have performed and compliedwith all agreements, covenants, and conditions required by this Agreement to beperformed or

 

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complied with it prior to orat the Closing IMPA shall have been furnished with certificates signed by thePresident or a Vice President of Louisville, dated the date of the Closing,certifying in form and substance satisfactory to IMPA, to the fulfillment ofthe foregoing conditions and to the further effect that there are no actions,suits, or proceedings pending or, to such officer’s knowledge, threatenedagainst or affecting Louisville before any court or administrative body oragency which would adversely affect the ability of Louisville to perform itsobligations under this Agreement.

 

11.5.3.                                                               Opinion Of Counsel For Louisville.

 

IMPA shall have been furnished with an opinion ofcounsel for Louisville, which may include counsel employed directly by Louisvilleas well as Louisville’s outside counsel, which counsel shall be satisfactory toIMPA, in form and substance satisfactory to IMPA, dated the date of theClosing, to the effect that:

 

(a)                                  Louisville is a corporationduly organized and validly existing under the laws of the Commonwealth ofKentucky and has the corporate power and authority to carry on its business aspresently conducted and to enter into and perform its obligations under thisAgreement; and

 

(b)                                 The execution, delivery, andperformance by Louisville of this Agreement have been duly authorized by allnecessary corporate action on the part of Louisville, does not contravene anylaw, or any governmental rule, regulation, or order applicable to Louisville orits properties, or the Articles of Incorporation or By-Laws of Louisville, anddo not and will not contravene the provisions of, or constitute a defaultunder, any indenture, mortgage, contract, or other instrument to whichLouisville is a party or by which Louisville is bound; and

 

(c)                                  The documents executed byLouisville in connection with the Closing have been duly authorized, executed,and delivered by Louisville; and

 

(d)                                 There are no actions, suits,or proceedings pending or, to such counsel’s knowledge, threatened against oraffecting Louisville before any court or administrative body or agency whichwould materially adversely affect the ability of Louisville to perform itsobligations under this Agreement; and

 

(e)                                  Any consent or approval of,giving of notice to, registration with or taking of any other action by, anystate, federal, or other governmental commission, agency, or regulatoryauthority, including, without limitation, the Kentucky Public ServiceCommission, the Federal Energy Regulatory Commission, and the Securities andExchange Commission, in connection with the execution, delivery, andperformance of this Agreement required to be obtained by Louisville on orbefore the Closing has been obtained; and

 

(f)                                    Louisville’s conveyance toIMPA in fee simple with covenant of general warranty of a 12.88 percentundivided ownership interest as tenants in common in the real estate set forthin Appendix E, is free and clear from all encumbrances, except

 

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easements, restrictions, andstipulations of record, taxes assessed and payable in the year of Closing andthereafter, and subject to the rights of IMEA which owns a 12.12 percentundivided interest as tenants in common, but such opinion will be inapplicableto matters not of record; and

 

(g)                                 Louisville has paid allproperty taxes (other than sales or use or other transfer taxes, if applicable)which are assessed on the interests conveyed to IMPS hereunder, except forproperty taxes assessed and payable in the year of Closing.

 

11.6.                        Conditions Precedent To The RespectiveObligations Of The Parties.

 

The respective obligations of Louisville and IMPShereunder are, unless waived in writing by Louisville and IMPS prior to or atthe Closing, subject to the special conditions in Article 3.3 hereof and theadditional condition that all governmental, judicial, and regulatory approvalsof the execution, delivery, and performance of this Agreement required to beobtained by Louisville and IMPS on or before the Closing shall have been obtained,including all governmental, judicial, and regulatory approvals necessary forthe issuance of IMPA’s tax-exempt revenue bonds in an aggregate principalamount sufficient to pay for any and all sums due to be paid by IMPS toLouisville at Closing.

 

11.7.                        Release From Louisville’s Indenture(s).

 

Louisville shall have obtained the releases from anyand all indentures of the ownership interest in Trimble County Unit 1 to beconveyed to IMPS hereunder at the Closing from the lien of such indenture.

 

11.8.                        Amendments.

 

This Agreement may be amended only by a writteninstrument duly executed by the Parties. When so amended, the Parties shallexecute a conformed copy of the Agreement, which conformed copy shall containall amendments to the Agreement and shall thereafter govern the Parties.

 

11.9.                        LimitedWarranty.

 

Louisville warrants that as of the Closing Datehereof, except as set forth in Appendix D, it knows of no defects in theoriginal design or construction of Trimble County Unit 1 or the Trimble CountyGeneral Plant Facilities, and that such facilities were designed for thegeneration and production of electric power and energy Should this Agreementbecome effective prior to full completion of such facilities, Louisville shallcomplete the original construction of such facilities at its expense.

 

Louisville also warrants that for the time periodsset forth below, Trimble County Unit I and the Trimble County General PlantFacilities shall be free of defects in materials or workmanship in the designand construction of such facilities: (a) if the Closing Date occurs by orbefore December 31, 1993, the limited warranty period shall

 

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be ninety days from theClosing Date; (b) if the Closing Date occurs by or before December 31, 1994,but after December 31, 1993, the limited warranty period shall be sixty daysfrom the Closing Date; (c) if the Closing Date occurs by or before December 31,1995, but after December 31, 1994, the limited warranty period shall be thirtydays from the Closing Date; (d) if the Closing Date occurs after December 31,1995, there shall be no limited warranty. Defects that are discovered duringthis warranty period, shall be repaired at Louisville’s expense. OTHER THAN FORTHIS EXPRESS WARRANTY, IMPA’S OWNERSHIP INTEREST IN TRIMBLE COUNTY UNIT 1 IS TOBE SOLD “AS IS” AND “WHERE IS”. LOUISVILLE MAKES NO OTHER REPRESENTATION ORWARRANTY WHATSOEVER IN THIS AGREEMENT, EXPRESSED, IMPLIED, OR STATUTORY,INCLUDING, WITHOUT LIMITATION, ANY REPRESENTATION OR WARRANTY AS TO THE VALUE,QUANTITY, CONDITION, SALABILITY, OBSOLESCENCE, MERCHANTABILITY, FITNESS, ORSUITABILITY FOR USE OR WORKING ORDER OF ANY OF TRIMBLE COUNTY UNIT 1 INCLUDINGTHE TRIMBLE COUNTY GENERAL PLANT FACILITIES, NOR DOES LOUISVILLE REPRESENT ORWARRANT THAT THE USE OR OPERATION OF ANY SUCH FACILITIES WILL NOT VIOLATEPATENT, TRADEMARK, OR SERVICE MARK RIGHTS OF ANY THIRD PARTIES. THE PROVISIONSOF THIS ARTICLE 11.9 SHALL GOVERN OVER ANY CONFLICTING PROVISIONS OF THISAGREEMENT.  Notwithstanding theforegoing, IMPA shall have the benefit, in proportion to its percentageownership interest in Trimble County Unit 1, of all manufacturers’ and vendors’warranties and all patent, trademark, and service mark rights running toLouisville in connection with Trimble County Unit 1 and the Trimble CountyGeneral Plant Facilities as they pertain to Trimble County Unit 1; providedthat Louisville shall have sole authority in decisions regarding theenforcement (including any renegotiation and settlement) of such warranties andpatent, trademark, and service mark rights, subject to the rights of IMPA asset forth in Article 5.5.6 hereof.

 

11.10.                  No Agency Or Third Party Beneficiary

 

Nothing herein is intended to or shall create anagency whereby IMPA becomes an agent for Louisville in any relationship withany third party. This Agreement is solely between Louisville and IMPA and shallnot be construed to create any third party beneficiary relationship with anyother person or entity.

 

# **ARTICLE 12.**

# **TAXES**

# ** **

12.1.                        Management Of Tax Matters.

 

12.1.1.                                                               Louisville’s Responsibility

 

Louisville shall have the responsibility for filingreturns, making property tax declarations, paying, seeking official tax rulingsor determinations, and other related functions pertaining to all taxes,payments in lieu of taxes, assessments, impositions,

 

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charges, and related costsof every kind and nature, ordinary or extraordinary, general or special,foreseen or unforeseen, settled or pending settlement, including, but notlimited to, property, sales, use and payroll taxes, connected with or arisingout of the construction, ownership, operation, maintenance, alteration, repair,rebuilding, use, or retirement of, and arising out of its ownership interestin, Trimble County Unit 1, the Trimble County General Plant Facilities, or anypart thereof, which are or may be imposed on Louisville by any federal, state,county, municipal, local, interregional, or quasi~ governmental authority.

 

12.1.2.                                                               IMPA’s Responsibility.

 

IMPA shall have the responsibility for filingreturns, making property tax declarations, paying, seeking official tax rulingsor determinations, and other related functions, for which it assumesresponsibility from and after Closing, pertaining to all taxes, payments inlieu of taxes, assessments, impositions, charges, and related costs of everykind and nature, ordinary or extraordinary, general or special, foreseen orunforeseen, settled or pending settlement, arising out of its 12.88 percentownership interest in Trimble County Unit 1, including, but not limited to,property, sales, use, and payroll taxes, connected with or arising out of theconstruction, ownership, operation, maintenance, alteration, repair, rebuilding,use, or retirement of Trimble County Unit 1, the Trimble County General PlantFacilities, or any part thereof, which are or may be imposed on IMPA by anyfederal, state, county, municipal, local, interregional, or quasi-governmentalauthority (collectively, the “Taxes’).

 

12.1.3.                                                               Cooperation.

 

Louisville and IMPA will mutually cooperate andreasonably assist each other in meeting their respective tax obligations underthis Agreement. IMPA shall, prior to filing any election, return, declaration,refund claim, request for ruling or determination, any pleading in any court oradministrative proceeding, or any other document with any governmentalauthority relating to the Taxes (a “Tax Filing”) give Louisville seven businessdays prior written notice of such proposed filing, which notice shall include acopy of the Tax Filing. Louisville will advise IMPA in writing within threebusiness days of the filing due date of any suggested changes which Louisvilledeems appropriate for the Tax Filing. IMPA is under no obligation toincorporate in the Tax Filing changes suggested by Louisville.

 

12.2.                        Sharing Of Taxes And Related Payments

 

All such taxes, payments in lieu of taxes,assessments, impositions, charges and related costs of Trimble County Unit 1,or the Trimble County General Plant Facilities or the Trimble County Site asthey pertain to Trimble County Unit 1, shall be shared and borne by Louisvilleand IMPA in proportion to their respective percentage ownership interests inTrimble County Unit 1; provided, however, IMPA shall be entitled to the entirebenefit to the extent of actual realization, of all exemptions from andreductions of taxes, including but not limited to property, sales, use, andpayroll taxes, connected with

 

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or arising out of theownership, operation, maintenance, alteration, repair, rebuilding, use, orretirement of Trimble County Unit 1 or any part thereof, which may be realizedbecause of the provisions, if any, of the Constitutions (of the Commonwealth ofKentucky, the State of Indiana, and the United States of America), statutes,ordinances, rules, regulations, and laws applicable to IMPA and not Louisville.

 

The portion of such taxes, payments in lieu oftaxes, assessments, impositions, charges and related costs that are to be borneby IMPA as set forth above in this Article 12.2 shall be billed to and paid byIMPA in accordance with Articles 7 and 8, as applicable, except for those taxeswhich are paid by IMPA directly to the taxing authority.

 

12.3.                        Payment Of Title Taxes And Fees

 

IMPA shall be responsible for all sales taxes,recording fees, and other taxes related to transfer of property, if any,incurred in connection with the conveyance(s) to IMPA by Louisville at Closing.

 

12.4.                        Exclusion Of Income Taxes

 

Notwithstanding the generality of Article 12.1above, Louisville and IMPA agree that the foregoing provisions of this Article12 shall not apply to any tax on or measured by income.

 

12.5.                        Non-creation OfTaxable Entity

 

Notwithstanding any other provision of thisAgreement, Louisville and IMPA do not intend to create hereby at law any jointventure, partnership, association taxable as a corporation, or other entity forthe conduct of any business for profit. Louisville and IMPA agree to electunder Section 76 1(a) of the Internal Revenue Code of 1986, as amended, toexclude the transactions created by this Agreement from the application ofSubchapter K, Chapter 1 of the Code, and both Parties agree to revise the termsof this Agreement to the extent and in a manner necessary to permit suchelection.

 

# **ARTICLE 13.**

# **INSURANCE**

# ** **

13.1.                        Procurement Of Insurance.

 

Except with regard to directors and officersliability insurance, Louisville shall maintain in force, for the benefit ofLouisville and IMPA as their interests in Trimble County Unit 1, Trimble CountyGeneral Plant Facilities, and the Trimble County Site shall appear, suchavailable insurance and self-insurance as the Coordination Committee shalldetermine to be appropriate.

 

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13.1.1.                                                               Sharing Of Insurance Costs.

 

The costs of such insurance policies referenced toin Article 13.1 above shall be shared by the Parties in proportion to theirrespective percentage ownership interests in Trimble County Unit 1. IMPA shallalso pay any additional premium that results from IMPA being named as anadditional insured party on Louisville’s existing policies. IMPA shall bearresponsibility for costs of and any losses incurred within the limits of anydeductibles on policies of insurance. If IMPA elects to participate inself-insurance, as discussed in the following paragraph, the costs of claimsand expenses for such self. insurance shall also be shared in proportion to therespective ownership interests in Trimble County Unit 1. IMPA’s share of suchinsurance and self-insurance costs shall be paid in accordance with Articles 7and 8, as applicable.

 

With regard to the portion of any self-insurance forwhich IMPA is responsible, IMPA shall be entitled, at its option, to separatelyfund and administer a reserve account to fund all claims and expenses for whichit is maintaining self-insurance. Any such separately maintained andadministered fund shall be established, maintained, and administered accordingto policies and procedures approved by the Coordination Committee. Such fundwill be a financial device for funding IMPA’s self-insurance obligation andwill play no role in administering claims. Where IMPA establishes and maintainssuch an account,. the Coordination Committee will determine appropriateprocedures and methodology for regularly billing for and recovering amounts dueto be paid by IMPA to Louisville for such claims and expenses. Such proceduresand methodology may include making adjustments to the billing and paymentpractices set forth in Article 7 and 8, as such Articles relate to IMPA’sself-insurance.

 

13.1.2.                                                               IMPA Named As Insured.

 

IMPA shall be named as an additional insured in suchinsurance policies. Louisville shall use its reasonable best efforts to havethe insurance underwriters furnish IMPA with a Certificate of Insurance of eachsuch insurance policy. In addition, Louisville shall use its reasonable bestefforts to have each of such policies endorsed so as to provide that IMPA shallbe given the same advance notice of cancellation or material change as isrequired to be given to Louisville. Loss or claim, if any, under such insurancepolicies shall be adjusted and settled by Louisville with the insuranceunderwriters in accordance with the third party claims procedure provided forin Article 5.5.6.

 

13.1.3.                                                               Procurement Of AdditionalInsurance For IMPA.

 

IMPA may obtain additional insurance beyond thatprovided for in this Article 13 to insure its ownership interest in TrimbleCounty Unit 1 and the Trimble County Site and its rights with respect to theTrimble County General Plant Facilities at its cost. With respect to suchadditional insurance:

 

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(a)                                  the proceeds from any claimarising through such additional insurance shall be disbursed to IMPA; and

 

(b)                                 loss or claim, if any, undersuch additional insurance shall be adjusted and settled by IMPA with theinsurance underwriters.

 

13.1.4.                                                               Sharing Of Refunds FromInsurance Premiums.

 

Any refunds of insurance premiums shall be allocatedamong the Owners on the same basis as the premium payment allocation from whichsuch refund was derived.

 

13.1.5.                                                               Sharing Of InsuranceProceeds

 

In the event of damage to property insured under thisArticle, it is agreed that the proceeds from insurance obtained by Louisvilleon behalf of the Owners shall be shared by the Owners on a pro rata basis basedon their relative payments of insurance premiums covering the damaged property.

 

13.2.                        Destruction.

 

13.2.1.                                                               Damage Or Destruction FullyCovered By Insurance

 

If property insured under this Article or anyportion thereof should be damaged or destroyed to the extent that the cost ofrepairs or reconstruction is estimated to be covered by the aggregate amount ofinsurance coverage (including any deductible) carried by Louisville for thebenefit of Louisville and IMPA pursuant to Article 13 hereof, then Louisvilleshall cause such repairs or reconstruction to be made so that such propertyshall be restored to substantially the same general condition, character, oruse as existed prior to such damage or destruction; provided however, if theestimate is wrong, and the insurance proceeds are insufficient to pay the costof repair or reconstruction, the Owners shall share the cost not reimbursed bysuch insurance in proportion to their percentage ownership interests in TrimbleCounty Unit 1.

 

13.2.2.                                                               Damage Or Destruction NotFully Covered By Insurance.

 

If Trimble County Unit 1, the Trimble County GeneralPlant Facilities or any portion thereof as they pertain to Trimble County Unit1, should be damaged or destroyed to the extent that the cost of repairs orreconstruction is estimated to be more than the aggregate amount of insurancecoverage (including any deductible) carried by Louisville for the benefit ofLouisville and IMPA pursuant to Article 13 hereof and covering the cost of suchrepairs or reconstruction, then, if Louisville elects to repair and reconstructsuch property and upon agreement of Louisville and IMPA, Louisville shall causesuch repairs or reconstruction to be made and Louisville and IMPA shall sharethe costs of such repairs or reconstruction not reimbursed by such insurance,in proportion to their percentage ownership interests in Trimble County Unit 1;provided, however, that:

 

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(a)                                  If IMPA elects not to joinLouisville in repairing and reconstructing such property, then, at Louisville’selection, the Parties shall determine the monetary amount to be paid byLouisville to IMPA or by IMPA to Louisville, as provided for in paragraph (b)of this Article 13.2.2. Upon payment of such monetary amount by Louisville toIMPA or by IMPA to Louisville, as the case may require as set forth in said paragraph(b), IMPA shall transfer its ownership interest in Trimble County Unit 1 andthe Trimble County Site, and its license to use the Trimble County GeneralPlant Facilities, and its easement to the Trimble County Site, to Louisvillefree and clear of all liens and encumbrances, and this Agreement shall bedeemed to have expired.

 

(b)                                 The monetary amount to bepaid to or received from IMPA pursuant to the provisions of paragraph (a) ofthis Article 13.2.2, shall be determined in accordance with the followingequation:

 

P=W*X

 

Where:

 
| P      | =      |   | the monetary amount to be paid to or received from IMPA. If P is  positive, the monetary amount shall be paid to IMPA;and if P is negative, the  monetary amount shall be received from IMPA.                                                                    |
|--------|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |                                                                                                                                                                                                                                                             |
| W      |   |   | IMPA’s percentage ownership interest in Trimble County Unit 1 before  transfer of IMPA’s ownership interest in such property.                                                                                                                          |
|   |   |   |                                                                                                                                                                                                                                                             |
| X      | =      |   | the fair market value (as determined by an independent appraiser  selected jointly by the Parties) of (I) Trimble County Unit 1 and (ii) the Trimble  County Site and the Trimble County General Plant Facilities as they pertain  to IMPA’s use of Trimble |

 

County Unit 1, at the time IMPA elects not to joinLouisville in repairing and reconstructing Trimble County Unit 1 or the TrimbleCounty General Plant Facilities. Fair market value shall be determined aftertaking into account all applicable costs of dismantling, demolishing, andremoval of equipment, facilities, and structures; security; maintenance;disposing of debris; and any site work necessary to remove the effects of suchdamage or destruction. Fair market value may be a negative figure whereappropriate.

 

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# **ARTICLE 14**.PARTITION OF OR TRANSFER OF INTEREST IN TRIMBLE COUNTY UNIT 1

# ** **

14.1.                        Special Nature Of TrimbleCounty Unit 1 . Waiver Of Right Of Partition.

 

The Parties recognize that Trimble County Unit 1 Isan Integral part of the facilities required to provide adequate service intheir respective service territories and the service territories of other coowners of Trimble County Unit 1 and that the physical partition of TrimbleCounty Unit 1 or any material part thereof would be Impossible and impracticaland wholly Inconsistent with the purposes for which this Agreement Is made.

 

Each of the Parties agrees that It will not take anyaction, by judicial proceedings or otherwise, to partition Trimble County Unit1, or that portion of the Trimble County Site conveyed by Louisville to IMPApursuant to Article 2.2 hereof, or any part thereof, in any way, whether bypartition In Mud or by sale and division of the proceeds thereof. Each of theParties further waives the right of partition and the benefit of all statutoryor common law that may now or hereafter authorize such partition of Trimble CountyUnit 1 or any part thereof, or that portion of the Trimble County Site conveyedby Louisville to IMPA pursuant to Article 2.2 hereof. In the event any suchright of partition shall hereafter accrue, each Party shall from time to timeupon the written request of the other Party execute and deliver such furtherInstruments as may be necessary to confirm the foregoing waiver and release ofIts right to partition. The foregoing provisions of this Article 14.1 shall bebinding upon and Inure to the benefit of the Parties, their respectivesuccessors and assigns, including mortgagees, receivers, trustees, or otherrepresentatives and their respective successors and assigns, and shall run withthe land. Louisville agrees to Insert a similar covenant In any contract withanother party which acquires an ownership Interest in Trimble County Unit 1,which covenant will be enforceable by IMPA.

 

14.2.                        Transfer Of OwnershipInterests To Third Parties.

 

If either Party (“Transferring Party’) shall desireto transfer (whether by sale, conveyance, assignment, lease, or otherwise) allor any portion of Its ownership Interest In Trimble County Unit 1 In a bonafide arms length transaction to any unaffiliated third party or parties, theTransferring Party shall give the other Party written notice thereof, and anysuch transaction with such unaffiliated third party or parties shall not beconsummated until the other Party has determined not to exercise Its right offirst refusal, as set forth In this paragraph. Such written notice shall fullydisclose the nature and terms of the proposed transaction and the Identity ofthe third party or parties Involved. Upon receipt of such written notice, theother Party shall have the first right to acquire the Transferring Party’sownership Interest in Trimble County Unit 1 that the Transferring Partyproposes to transfer to the third party or parties, upon the same terms andconditions which the Transferring Party proposes to make with the third partyor parties; provided, however, that where Louisville Is the Transferring Party,IMPA’s right of first refusal shall be subordinate to a prior right of IMPA toacquire Louisville’s ownership Interest. Within ~0 days following receipt ofsuch notice, the other Party shall give

 

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written notice to theTransferring Party stating whether or not It elects to acquire the TransferringParty’s undivided ownership Interest In Trimble County Unit 1 which theTransferring Party proposes to dispose of to the third party or parties;provided however, that where Louisville Is the Transferring Party, IMPA’selection to acquire such Interest shall be deemed to be of no effect If IMEAelects to acquire such Interest. If the Party elects to exercise Its rights toacquire such Interest, the Transferring Party, as soon as practicable, shallexecute such Instruments as may be necessary and appropriate to effectuate suchsale, conveyance, transfer, assignment, lease, or other disposition, as thecase may be, to the other Party, free and clear of all liens, charges, andencumbrances for which the

 

Transferring Party, as between the Parties, isresponsible, including the indenture(s) of the Transferring Party.

 

14.2.1.                                                               Conditions Of Transfer

 

If the other Party elects not to acquire theTransferring Party’s ownership interest in Trimble County Unit 1, as providedin the first paragraph of Article 14 2, the Transferring Party may consummateits proposed transaction with the third party or parties and dispose of suchownership interest to the third party or parties, provided, that suchtransaction is consummated within 240 days following receipt by the other Partyof the written notice first referred to in the first paragraph of Article 14.2;and provided further, that the other Party has approved the prospectivepurchaser as suitable and desirable as a joint owner of Trimble County Unit 1,although such approval may not unreasonably be withheld and grounds forwithholding such approval shall be limited to such factors as will materially,adversely affect the other Party’s interests hereunder; provided, however, thatwhere Louisville is the Transferring Party, IMPA’s right to approve theprospective purchaser as suitable and desirable shall be limited to situationsin which the proposed transfer reduces Louisville’s ownership interest inTrimble County Unit 1 to less than fifty (50) percent, or where such proposedtransfer conveys, in whole or part, Louisville’s rights and obligations foroperation of Trimble County Unit 1 under this Agreement to such third party orparties; and provided, further, that IMPA shall require (as a condition of orIn connection with the sale, conveyance, transfer, assignment, lease, or otherdisposition, and for the benefit of the other Party) the third party or partiesacquiring such ownership interest to assume and agree to be bound by theprovisions of this Agreement and any amendments thereto, and In furtherancethereof the provisions of this Agreement shall be amended appropriately toreflect:

 

(a)                                  the addition of such thirdparty or parties as a party or parties to this Agreement; and

 

(b)                                 the ownership Interest InTrimble County Unit 1 acquired by such third party or parties and the decreasedownership Interest in Trimble County Unit 1 of the Transferring Party; and

 

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(c)                                  the rights, duties, andobligations of the Transferring Party and such third party or parties underthis Agreement. Further, the Transferring Party hereby agrees to save the otherParty harmless from and against all loss or liability which the other Party mayIncur as a result of any failure by such third party or parties to fulfill itsor their duties and obligations under this Agreement and any amendmentsthereto. In addition, the consummation of any transaction by the TransferringParty with a third party or parties shall not release the Transferring Partyfrom any of its debts or liabilities to the other Party which, at the time ofthe consummation of the transaction, have accrued under this Agreement, and anyamendments thereto, unless the Parties shall agree in writing to the contrary.

 

14.2.2.                                                               Further Conditions OfTransfer

 

The right of the Transferring Party to dispose ofsuch ownership interest to a third party or parties, as set forth in the firstparagraph of Article 14.2, is subject to the further condition that the otherParty shall be given written notice thereof and shall have the further right offirst refusal, to the same extent and by the same procedure described in thefirst paragraph of Article 14.2:

 

(a)                                  if the Transferring Partyshall undertake to consummate its proposed transaction at a time subsequent to240 days following receipt of the written notice first referred to in the firstparagraph of Article 14.2; or

 

(b)                                 if the Transferring Partyshall undertake to dispose of such ownership interest to a third party orparties other than those whose identity was disclosed in said notice; or

 

(c)                                  if the Transferring Partyshall undertake to dispose of such ownership interest upon different terms andconditions than were disclosed in said notice.

 

14.2.3.                                                               Non-applicability Of CertainProvisions

 

The provision of the foregoing Articles 14 2, 14 21, and 14 2 2 shall continue for the duration of this Agreement and shall beapplicable to each and every occasion and whenever either Party desires todispose of (whether by sale, conveyance, transfer, assignment, lease, orotherwise) all or any portion of its ownership interest in Trimble County Unit1 to any third party or parties, provided, that such provisions shall not beapplicable to, and each of the Parties hereby consents to, the following:

 

(a)                                  the transfer, sale, orassignment to a financially responsible subsidiary, affiliate, or successor ofLouisville; or

 

(b)                                 the transfer, sale, orassignment by IMPA to a financially responsible successor agency or affiliateoperating as a single entity; provided that if IMPA is dissolved or liquidatedby operation of law or otherwise, and IMPA’s interest herein is not assumed bya financially responsible successor agency operating as a single entity,Louisville shall have the immediate option to purchase all of IMPA’s interestherein at

 

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fair market value. For thispurpose, fair market value shall be determined by an Independent appraiserselected jointly by the Parties; or

 

(c)                                  the transfer, assignment,pledge, hypothecation, mortgage, or grant (by indenture of mortgage, deed oftrust, or otherwise) by either Party of Its ownership Interest In TrimbleCounty Unit 1, together with all or substantially all of Its other electricutility property, for the purpose of securing bonds or other obligations forborrowed money Issued or to be Issued by It, Including the effect of any after-acquiredproperty clause of any such Indenture of mortgage, deed of trust, or otherInstrument now existing or hereafter created by such Party, or the realizationon or enforcement of such security or the exercise by the trustee or themortgagee, or as the case may be, or the beneficiaries of such security of anyof the rights, powers, or privileges provided for with respect. thereto; or

 

(d)                                 the transferring by eitherParty to a third party of Its undivided ownership Interest In Trimble CountyUnit 1, together with all or substantially all of Its other electric utilityproperty, whether by sale or pursuant to or as a result of a merger,consolidation, or corporate reorganization; or

 

(e)                                  the transferring byLouisville of any interest In Trimble County Unit 1 which transfer would notreduce Louisville’s interest in Trimble County Unit 1 to a level belowseventy-five (75) percent; or

 

(f)                                    the transferring byLouisville of any interest in Trimble County Unit 1 to IMEA.

 

All transfers of interest set forth in this Article14 shall be conditioned upon the transferee, by written agreement or byoperation of law, assuming the obligations of this Agreement, and anyamendments thereto, of the Party so transferring; except that transfer under(b) and (c) above shall not be subject to this condition prior to any exerciseof ownership, control, or possession by the transferee over the interesttransferred.

 

14.3.                        Transfer Of AssociatedRights And Interests

 

No transfer (whether by sale, conveyance,assignment, lease, or otherwise) by IMPA of any interests under this Agreementshall be permitted, or shall become effective, unless the interest transferredincludes a corresponding and equivalent transfer of IMPA’s associated rightsand interests under this Agreement, including its rights and interests inTrimble County Unit 1, the Trimble County General Plant Facilities, and theTrimble County Site, and unless such transfer is made in full compliance withthis Article 14.

 

# **ARTICLE 15**.RIGHT OF FIRST REFUSAL

# ** **

If, at any time within the term of this Agreement,Louisville shall apply to the Kentucky Public Service Commission for acertificate of public convenience and

 

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necessity for theInstallation at the Trimble County Site of a coal-fired generating unit for useby Its system as a base load plant, IMPA shall have a right of first refusal toparticipate in the ownership of said unit by electing to own 12.88 percent ofsuch unit on the terms set forth herein. In the event such a certificate is notlegally required, Louisville shall use Its best efforts to give notice to IMPSequivalent In time and content to that which would be given where a certificateIs required. At least ninety days prior to applying for such certificate, Louisvilleshill provide written notice to IMPA of Its Intention to make such application,and shall provide IMPA with technical and economic Information available atthat time which pertains to the planned unit, and the estimated cost thereof.IMPA shall have 180 days to elect to participate In such unit. IMPA’s right toparticipate in such unit shall lapse and expire unless IMPA provides writtennotice to Louisville of Its acceptance of such participation within 180 daysafter the date of Louisville’s earlier notice to IMPA. Within 180 days ofLouisville’s receipt of IMPA’s notice of acceptance, the Parties shallnegotiate in good faith and execute a separate contract Incorporating the termsand conditions of this Article 15, as well as other appropriate terms andconditions, covering the Installation and operation of such new unit.

 

Should IMPA elect to participate, It shall pay itspro rata share of all actual expenditures made for Construction Work Inconnection with such unit and shall make quarterly progress payments toLouisville as said expenditures are Incurred and billed by Louisville to IMPA.In addition to such actual expenditures, IMPA shall pay Louisville a generalsupervisory fee equal to two percent of such actual expenditures. IMPA’s participationIn the unit shall be subject to all terms and conditions set forth In thisAgreement unless waived In writing by Louisville, or otherwise mutually agreedby the Parties. Terms relating to Louisville’s operation and management of suchunit may be set forth In an additional agreement between the Parties. Paymentof the above amounts shall entitle IMPA, In addition to Its ownership Interestin such unit, to a license to use the Trimble County General Plant Facilitiesand the Trimble County Site as they pertain to such unit. Subject to IMPA’sright to elect to participate In 12.88 : percent of such unit, nothing hereinshall prevent Louisville from selling, offering to sell, or contracting withany other Party, for an ownership or other Interest in or contractualentitlement from the remainder of such unit, or In the Trimble County GeneralPlant Facilities or Trimble County Site as they pertain to such unit. The rightof first refusal shall apply only to the next coal-fired generating unit builtat the Trimble County Site for use as a base load plant, and shall not extendto any subsequently built unit IMPA accepts this right of first refusalacknowledging that IMEA has a similar right of first refusal In such unit Inthe event Louisville assigns or conveys Its right to develop such unit to anaffiliate of Louisville or to a third party, such assignment or conveyanceshall be subject to IMPA’s right of first refusal on the same terms andconditions as if Louisville were the developer.

 

If Louisville Is the developer of such unit,contracts for general construction of such unit (not Including design,architecture, and engineering services) will be awarded by Louisville pursuantto a bidding process arranged and implemented by Louisville. Louisvillereserves the right to participate, for itself and for any affiliate ofLouisville, as a bidder for the contractual services to be awarded. Louisville,In Its sole discretion, will

 

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determine the winning bidderbased on a “best bid’ approach considering price, quality, experience, and allother factors deemed relevant by Louisville.

 

# **ARTICLE 16.**ASSIGNMENT

# ** **

16.1.                        Limitation Of Assignability.

 

This Agreement shall not be assignable by eitherParty without the written consent of the other Party, except that no suchconsent shall be required for IMPA to assign this Agreement (a) as an incidentto the disposition of all of its ownership interest in accordance with Articles14.2, 14.2.1, and 14.2.2 hereof, or (b) to the trustee for the tax-exemptrevenue bonds issued by IMPA to pay the costs of the acquisition of IMPA’sownership interest in Trimble County Unit 1 hereunder; and (c) each of theParties hereby consents to the assignment of this Agreement as an incident tothe disposition of a Party’s ownership interest, as permitted by Article14.2.3.

 

16.2.                        Successors And Assigns.

 

This Agreement shall inure to the benefit of and bebinding upon Louisville and IMPA and their respective successors. ThisAgreement shall inure to the benefit of and be binding upon the assigns ofLouisville and IMPA when such assignment is made in accordance with theprovisions of Article 16.1.

 

# **ARTICLE 17.**LIABILITY AND DEFAULT

# ** **

17.1.                        Liability To Third Parties.

 

Notwithstanding any provision to the contrary Inthis Agreement, any liability or any payment, cost, expense, or obligationarising from a claim of liability (after application thereto of any Insurancecoverage or proceeds) to a third party or parties against one or both of theParties and arising from the acquisition, planning, engineering, design,licensing, procurement, construction, Installation, completion, operation, use,management, control, maintenance, replacement, alteration, modification,renewal, rebuilding or repair, retirement, disposal, or salvaging of TrimbleCounty Unit 1 or any part thereof and the Trimble County General PlantFacilities and the Trimble County Site as they pertain to Trimble County Unit1; or from any other action or failure to act by either Party (or Its employees,agents, or contractors) In carrying out any of the provisions of this Agreementin regard to Trimble County Unit 1 or any part thereof and the Trimble CountyGeneral Plant Facilities and the Trimble County Site as they pertain to TrimbleCounty Unit 1, shall be shared by the Parties in proportion to their respectivepercentage ownership interests in Trimble County 1 in all circumstances exceptwhere such liability or claim of liability Is the result of gross negligence orintentional wrongdoing on the part of Louisville or IMPA. If, by reason of anysuch liability or claim of liability (after application thereto of anyInsurance coverage or proceeds) to a third party or parties, either Party shallbe called upon to make any payment or to Incur any

 

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cost, expense, or obligationIn excess of that for which It Is responsible under the provisions of thepreceding sentence, then the other Party shall reimburse the Party making suchexcess payment or Incurring any such excess cost, expense, or obligation to thefull extent of the excess. Louisville shall be solely responsible for thirdparty claims arising prior to Closing and shall fully indemnify IMPA againstany such claim.

 

17.2.                        Liability Between TheParties.

 

Except as set forth In this Article 17.2, Louisvilleshall not be liable to IMPA for any loss, cost, damage, or expense Incurred byIMPA as a result of any action or failure to act, under any circumstances, byLouisville (or Its employees, agents, or contractors) In carrying out any ofthe provisions of this Agreement, except that Louisville will be liable to IMPAfor (a) any such loss, cost, damage, or expense which is the result of grossnegligence or intentional wrongdoing on the part of Louisville, and (b) anydamage to IMPA caused by Louisville’s negligence, but only If such damageresults from Louisville’s failure to follow Good Utility Practice in operatingTrimble County Unit 1; provided, that no liability for failure to follow GoodUtility Practice shall exceed, in any one contract year, five percent of theamount paid by IMPA pursuant to Articles 7.1.2, 7.1.3 and. 7.1.4 in that samecontract year.

 

Notwithstanding any other provision of thisAgreement, in no event, however, shall Louisville be liable to IMPA withrespect to any claim, whether based on contract, tort (including negligence),patent, trademark or service mark, or otherwise, for any indirect, special,incidental, or consequential damages, including, but not limited to, loss ofprofits or revenues, loss of use of Trimble County Unit 1 or any part thereofand the Trimble County General Plant Facilities and the Trimble County Site asthey pertain to Trimble County Unit 1, cost of capital, cost of purchased orreplacement power, claims of the customers of IMPA for service interruptions.

 

In no event shall Louisville be excused fromliability for its fraudulent acts.

 

17.3.                        Indemnification.

 

Subject to Article 17.2 hereof, each Party(“breaching Party~) hereby agrees to indemnify and hold the other Party(“non-breaching Party”) harmless from, against, and in respect of and shall ondemand reimburse the non-breaching Party for:

 

(a)                                  any and all loss, liability,or damage resulting from any untrue representation, breach of warranty, ornon-fulfillment of any covenant or agreement by the breaching Party containedherein or In any certificate, document, or instrument delivered to thenon-breaching Party hereunder and

 

(b)                                 any and all loss suffered bythe non-breaching Party due to the breaching Party’s failure to perform orsatisfy any obligation assumed pursuant to this Agreement; and

 

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(c)                                  any and all loss resultingfrom actions, suits, proceedings, claims, demands, assessments, judgments,costs, and expenses, including, without limitation, legal fees and expenses,incident to any of the foregoing or incurred in investigating or attempting toavoid the same or to oppose the imposition thereof, or in enforcing thisindemnity.

 

17.4.                        Nature And Survival OfRepresentations And Warranties.

 

Each representation, warranty, indemnity, covenant,and agreement made by the Parties in this Agreement or In any document,certificate, or other instrument delivered by or on behalf of the Partiespursuant to this Agreement or in connection herewith, shall survive theClosing.

 

17.5.                        Default.

 

17.5.1.                                                               Events of Default.

 

The following shall be Events of Default under thisAgreement:

 

17.5.1.1.                              Failure To Make Payment.

 

Subject to Article 8.2 hereof, failure by eitherParty to make any payment to the other Party required under this Agreementwithin sixty (60) days after the date on which such payment becomes due, orfailure by either Party to give any credit to the other Party required underthis Agreement for a period of sixty (60) days after the date on which suchcredit becomes due, or failure by either Party to make payment for a period ofsixty (60) days after the date on which such payment becomes due to any thirdparty, when failure to do so could result in a lien on any of the propertyincluded under this Agreement or otherwise adversely affects the interests ofthe other Party; provided, however, that no Party shall be in default if theamount it owes hereunder can be, and is, offset in whole within sixty (60) daysafter the date on which such amount became due and payable, by the Party towhom that sum is owed under this Agreement.

 

17.5.1.2.                              Failure To Perform.

 

Failure by either Party to perform any materialobligation, duty, or responsibility in accordance with the provisions of thisAgreement.

 

17.5.2.                                                               Curing Default In Regard ToPaying Money.

 

As to any default resulting from the failure to paymoney, the defaulting Party may remedy its default (when its default is thefailure to pay money) by paying to the non-defaulting Party on or before ninety(90) days from the date the payment becomes due:

 

(a)                                  the sums due; and

 

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(b)                                 interest on the sums due atthe Agreed Rate from the date due until paid; and

 

(c)                                  any other costs incurred bythe non-defaulting Party as a result of such default.

 

17.5.3.                                                               Curing Default For OtherThan Failure To Pay Money

 

A Party in default for reasons other than thefailure to pay money may cure such default by performing such act as isnecessary to cure the default and by paying the non-defaulting Party on orbefore ninety (90) days from the date such default occurred, any sums due underArticle 17.3 hereof.

 

17.5.4.                                                               Non-Applicability Of CureProvisions

 

Articles 17.5.2 and 17.5.3 hereof shall not beapplicable to any Event of Default relating to pre-Closing or Closingactivities set forth in this Agreement. Cure periods under Articles 175.2 and17.5.3 will not operate to extend the time specified in any other Article of thisAgreement for the performance or occurrence of any act or event, unlessotherwise specified.

 

17.5.5.                                                               Appointment Of AReceiver.

 

In the event the default continues for a period of180 days, then the Non-Defaulting Party may have a receiver appointed by astate or federal court sitting in Louisville, Kentucky to take control of andoperate the defaulting Party’s interest in the facilities and perform inaccordance with the terms of this Agreement.

 

17.5.6.                                                               Additional Obligations.

 

With respect to any Party as to which an Event ofDefault has occurred, such Party shall use its best efforts to take any and allsuch further actions and shall execute and file where appropriate any and allsuch further legal documents and papers as may be reasonable under the circumstancesin order to facilitate the carrying out of this Agreement or otherwiseeffectuate its purpose, including but not limited to action to seek anyrequired governmental or regulatory approval and to obtain any other requiredconsent, release, amendment, or other similar document.

 

17.5.7.                                                               Waivers

 

No waiver of any default or Event of Defaulthereunder shall extend to or affect any subsequent default or Event of Defaultor shall impair any rights or remedies consequent thereon. No delay or omissionto exercise any remedy available upon any Event of Default shall impair anyParty’s right to exercise such remedy or shall be construed to be a waiverthereof, but any such remedy may be exercised from time to time and as often asmay be deemed expedient. In order to entitle each Party hereto to

 

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exercise any remedyconferred upon or reserved by it in this Article 17, notice shall be providedin accordance with Article 21.2 hereof.

 

17.5.8.                                                               Legal And Other costs.

 

In the event that any Party (the “Defaulting Party’)defaults in its obligations under this Agreement and, as a result thereof, theother Party (the “Non-Defaulting Party’) seeks to legally enforce its rightshereunder against the Defaulting Party, then, in addition to all damages andother remedies to which the Non-Defaulting Party Is entitled by reason of suchdefault, the Defaulting Party shall promptly pay to the Non-Defaulting Party anamount equal to all costs and expenses (including reasonable attorneys’ fees)paid or incurred by the Non-Defaulting Party in connection with suchenforcement.

 

17.6.                        Force Majeure

 

In no event shall either Party be liable to theother Party for failure by such Party to perform any of its obligations underthis Agreement because of Force Majeure. Nothing contained herein shall beconstrued to require a Party to settle any strike, lockout, work stoppage, orother industrial disturbance or dispute in which it may be involved or to takean appeal from any judicial, regulatory, or administrative action. Any Partyrendered unable to fulfill any of its obligations under this Agreement byreason of Force Majeure shall exercise due diligence to remove such inabilitywith all reasonable dispatch. In the event either Party is unable, in whole orin part, to perform any of its obligations by reason of Force Majeure, otherthan obligations to make payments hereunder, the obligations of the Partyrelying thereon, insofar as such obligations are affected by such Force Majeure,shall be suspended during the continuance thereof but no longer. The obligationof IMPA to make payments as set forth in Articles 7 and 8 shall beunconditional and absolute, and shall not be subject to reduction, setoff, orclaim of Force Majeure. The Party invoking the Force Majeure shall specificallystate the full particulars of the Force Majeure and the time and date when theForce Majeure occurred. Notices given by telephone under the provision of thisArticle shall be confirmed in writing as soon as reasonably possible. When theForce Majeure ceases, the Party relying thereon shall give immediate noticethereof to the other Party. This Agreement shall not be terminated by reason ofForce Majeure but shall remain in full force and effect.

 

**ARTICLE 18.ADMINISTRATION**

 

18.1.                        Coordination Committee.

 

From time to time various administrative, financial,and technical matters may arise in connection with the terms and conditions ofthis Agreement which will require the cooperation and consultation of the Partiesand interchange of information. As a means of providing for such consultation,interchange, decision making, or ratification, a Coordination Committee ishereby established with functions as described in Article 18.4 below. However,such Committee shall not diminish in any manner the authority of

 

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Louisville or the rights ofIMPA as set forth in the various sections of this Agreement. The CoordinationCommittee shall have no authority to modify or amend the terms of thisAgreement.

 

18.2.                        Membership.

 

The Coordination Committee shall have one memberfrom each Party. Within 60 days after execution of this Agreement, each Partyshall designate in writing its Representative and at least one alternate on theCoordination Committee and shall promptly give written notice thereof to theother Parties. Thereafter, each Party shall promptly give written notice to theother Party any change in the designation of its Representative on theCoordination Committee. The Chairman of the Coordination Committee shall be theLouisville Representative, who shall be responsible for calling meetings andestablishing agenda Each Party, however, shall have the right to have an itemincluded on the agenda. All actions taken by the Coordination Committee must beby majority vote, with each Party entitled to vote in shares equal to itsownership interest. The Coordination Committee may also act without a meetingby telephone conference or notational voting by correspondence. Majority voteshall not be required for either Party to invoke the procedure under Article19.2 for handling disagreements.

 

18.3.                        Meetings.

 

The Coordination Committee shall meet annually on adate and at a location to be announced by the Chairman at least thirty (30)days in advance, or sooner with the consent of all members. Such other meetingsas are reasonably required may be called by any member with as much advancenotice as is practical. Meetings may be attended by other representatives ofthe Parties.

 

18.4.                        Functions

 

The Coordination Committee shall have the followingfunctions:

 

(a)                                  Provide liaison between theParties at the management level and exchange Information with respect tosignificant matters of licensing, design, construction, operation, andmaintenance of Trimble County Unit 1 and the Trimble County General PlantFacilities and the Trimble County Site as they pertain to Trimble County Unit1.

 

(b)                                 Appoint Ad Hoc Committees,the members of which need not be members of the Coordination Committee, asnecessary to perform detailed work and conduct studies regarding mattersrequiring investigation.

 

(c)                                  Review and discuss disputesarising under this Agreement.

 

(d)                                 Provide liaison between theParties with respect to the financial and accounting aspects of IncrementalCapital Assets and operation of Trimble County Unit I and perform thosefunctions set forth in Article 6.1 hereof.

 

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(e)                                  Provide a liaison betweenthe Parties with respect to the financial and accounting aspects of theownership of the property.

 

(f)                                    Review and approve budgetsfor operation, maintenance, and Incremental Capital Assets, includingretirement of facilities, which affect Trimble County Unit 1 and the TrimbleCounty General Plant Facilities and the Trimble County Site as they pertain toTrimble County Unit 1.

 

(g)                                 Perform such other duties asset forth pursuant to the other Articles of this Agreement.

 

18.5.                        Records

 

The Coordination Committee shall keep writtenrecords of all meetings.

 

18.6.                        Expenses.

 

Each Party shall be responsible for the personalexpenses of its Representative and its other attendees. All other expensesincurred in connection with the performance by the Coordination Committee ofits functions shall be allocated and paid as determined by the CoordinationCommittee.

 

18.7.                        Conduct

 

Members of the Coordination Committee shall usetheir reasonable best efforts to perform Committee functions by taking intoaccount Good Utility Practice.

 

**ARTICLE 19.DISAGREEMENT**

 

19.1.                        Consultation.

 

In accordance with the provisions of Article 18, themembers of the Coordination Committee will consult in connection with any majormatter arising under this Agreement.

 

19.2.                        Disagreement.

 

If any disagreement arises on major operation andmaintenance matters pertaining to Trimble County Unit 1, major capital matterspertaining to Trimble County Unit 1, or major retirement matters, or othermatters arising under this Agreement, pertaining to Trimble County Unit 1(“Plant Subject?), such matters shall be discussed by the CoordinationCommittee and timely mutual agreement sought in regard thereto. If each of themembers of the Coordination Committee agrees to the resolution of any PlantSubject, such agreement shall be reported in writing to and shall be bindingupon the Parties—within the authority of the Coordination Committee as statedin Article 18. In the unlikely event that each of the members of theCoordination Committee is unable to

 

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reach agreement within areasonable time (giving due cognizance to the operating and maintenanceschedules of Trimble County Unit 1 and all other pertinent circumstances) withrespect to any Plant Subject under consideration, the President of Louisvilleor the President of IMPA can, by written notice to the members of theCoordination Committee, withdraw the matter from consideration by theCoordination Committee and submit the same for resolution to the President ofLouisville and the President of IMPA. If these senior representatives of theParties agree to a resolution of the matter, such agreement shall be reportedin writing to and shall be binding upon the Parties; but if said seniorrepresentatives fail to resolve the matter within seven days after itssubmission to them, then the matter may proceed to arbitration as provided inArticle 19.3.

 

19.2.1.                                                               Arbitration.

 

If a disagreement should arise with respect to anyPlant Subject which is not resolved by the Coordination Committee or the seniorrepresentatives of the Parties as provided in Article 19.2 or any otherdisagreement concerning this Agreement, then such disagreement may be settledby an Arbitration Board, (or by such other form of dispute resolution as agreedupon by the Parties) which shall consist of three arbitrators as hereinafterprovided, in accordance with the provision of this Article 19.3. If, after theprocedure for resolving such disagreement by the Coordination Committee or thesenior representatives of the Parties as provided Ii Article 19.2 has beenexhausted, either Party desires that such disagreement shall be settled byarbitration, it shall serve written notice upon the other Party setting forthin detail such disagreement with respect to which arbitration is desired. Suchdisagreement shall be settled by arbitration if, after receipt of such writtennotice, both of the Parties shall agree in writing that such disagreement shallbe settled by arbitration.

 

Within a period of thirty (30) days from the date ofsuch agreement in writing to settle such disagreement by arbitration, eachParty shall select one arbitrator. Within a period of sixty (60) days from thedate of such agreement in writing to settle such disagreement by arbitration,the two arbitrators so selected shall meet and select one additionalarbitrator. If either or both of the two arbitrators to be selected by theParties, as herein provided, are not so selected within the specified 30 dayperiod, or if the two arbitrators selected by the Parties shall fail to agreeupon the selection of the additional arbitrator within the specified 60 dayperiod, either Party may, upon written notice to the other Party, apply to theAmerican Arbitration Association for the appointment of the arbitrator orarbitrators who have not been so selected and such Association shall thereuponbe empowered to select such arbitrator or arbitrators.

 

The arbitration proceedings shall be conducted inLouisville, Kentucky unless otherwise mutually agreed. The Arbitration Boardshall afford adequate opportunity to both of the Parties to present informationwith respect to the disagreement submitted to arbitration and may requestfurther information from either Party. Except as provided in the precedingsentence, the Parties may, by mutual agreement, specify the rules which are togovern any proceeding before the Arbitration Board and limit the matters to beconsidered by the Arbitration Board, in which event the Arbitration Board shallbe

 

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governed by the terms andconditions of such agreement. In the absence of any such agreement respectingthe rules which are to govern any proceeding, the then current rules of theAmerican Arbitration Association for the conduct of commercial arbitrationshall govern the proceedings, except that if such rules shall conflict with thethen current provisions of the laws of Kentucky relating to arbitration, suchconflict shall be governed by the then current provisions of the laws ofKentucky relating to arbitration.

 

Procedural matters pertaining to the conduct of thearbitration and the award of the Arbitration Board shall be made upon adetermination of a majority of the arbitrators. The Parties shall, however, beentitled to all discovery provided for by the Kentucky Rules of CivilProcedure. The findings and award of the Arbitration Board, so made upon adetermination of a majority of the arbitrators, shall be final and conclusivewith respect to the disagreement submitted for arbitration and shall be bindingupon the Parties, except as otherwise provided by law. Each Party shall pay thefee and expenses of the arbitrator selected by or for it, together with thecosts and expenses incurred by it in the preparation of its case to thearbitrators. The fee and expenses of the third arbitrator selected inaccordance with this Article 19.3 shall be assigned in equal parts to theParties, and each Party shall assume and pay the portion of such fee and costsso assigned to it Judgment upon the award may be entered in any court havingjurisdiction In the event the Parties do not agree to arbitrate, each shallhave the right to take appropriate judicial action. 19 4 Obligations To MakePayments

 

If a disagreement should arise from any PlantSubject which is not resolved by the Coordination Committee or the seniorrepresentatives of the Parties as provided in Article 19.2, then, pending theresolution of the disagreement by arbitration and/or litigation, Louisvilleshall continue to operate Trimble County Unit 1 and make necessary IncrementalCapital Assets in a manner consistent with this Agreement, and IMPA shallcontinue to make all payments required in accordance with the applicableprovisions of this Agreement.

 

**ARTICLE 20.REMEDIES**

 

20.1.                        All Remedies . Setoff.

 

In the event either Party (the “Defaulting Party’)fails to pay when due any amount owing by it to the other Party (the“Non-Defaulting Party”) under this Agreement or the Interconnection Agreementor fails to perform or observe any covenant, condition, or agreement to beperformed or observed under this Agreement or the Interconnection Agreement,the Non. Defaulting Party shall have available to it all remedies, legal andequitable, including, without limitation those available in order to enforcepayment of any such amount or performance or observance of any such covenant,condition, or agreement, subject to the defaulting Party’s rights to curedefault under Article 17.5. All overdue payments shall bear interest at theAgreed Rate. Further, the Non-Defaulting Party shall have the right to setoffagainst any amount owed to it by the Defaulting Party the amount of any paymentwhich such Party has failed to pay when due under this

 

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Agreement or the InterconnectionAgreement. In addition, the Non-Defaulting Party shall have the other rightsand remedies available to it under this Article 20.

 

20.2.                        Injunctive Relief.

 

The Parties hereto agree and acknowledge that thefailure to perform any of their obligations under this Agreement, including theexecution of legal documents which may be reasonably requested as set forth inthis Article, would cause irreparable injury to the other Party and that theremedy at law for any violation or threatened violation thereof would beinadequate, and agree that the other Party shall be entitled to a temporary orpermanent injunction or other equitable relief specifically to enforce suchobligation without the necessity of proving the inadequacy of its legalremedies.

 

20.3.                        No Remedy Exclusive.

 

No remedy conferred upon or reserved to the Partieshereto in this Agreement is intended to be exclusive of any other remedy orremedies available hereunder or now or hereafter existing at law, in equity, orby statute or otherwise, but each and every such remedy shall be cumulative andshall be in addition to every other such remedy. The pursuit by any Party ofany specific remedy shall not be deemed to be an election of that remedy to theexclusion of any other or others, whether provided hereunder or by law, equity,or statute.

 

20.4.                        Failure To Participate InIncremental Capital Assets.

 

If IMPA fails to make any payment of its share ofthe cost of Incremental Capital Assets after the Closing, Louisville shall havethe right, at its election, to give written notice of such failure to IMPA. Ifsuch overdue payment and all other overdue payments~ if any, of IMPA’s share ofthe cost of the Incremental Capital Assets after the Closing, together withinterest on such overdue payment or payments, are not paid within ninety (90)days after the giving of the written notice first referred to in thisparagraph, then (a) IMPA’s rights to make any further payments of its share ofthe cost of the Incremental Capital Asset shall thereupon terminate, and (b)the respective percentage ownership interests in Trimble County Unit 1 shall beadjusted in accordance with the following formula:

 

ADD = ALGE*IPCT/(IMPA+ALGE) .

 

where:

 
| ADD =        |   | Additional percentage ownership interest accruing to Louisville as a  result of making its additional investment to complete construction of  Incremental Capital Assets (there shall be a corresponding reduction in the  percentage ownership interest of IMPA in Trimble County Unit 1 and the  Trimble County Site). |
|--------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|         |   |                                                                                                                                                                                                                                                                                                                     |
| IMPA  = |   | Investment made by IMPA for its respective percentage ownership                                                                                                                                                                                                                                                          |

 

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|         |   | interest in Trimble County Unit 1, the Trimble County Site and its  nonexclusive license with respect to the Trimble County General Plant Facilities  to the time of the written notice first referred to in this Article 20.4. |
|--------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|         |   |                                                                                                                                                                                                                            |
| ALGE  = |   | Additional Investment made by Louisville to complete construction of  Incremental Capital Assets as aforesaid.                                                                                                                  |
|         |   |                                                                                                                                                                                                                            |
| IPCT  = |   | IMPA’s percentage ownership interest in Trimble County Unit 1 at the  time of the written notice first referred to in this Article 20.4.                                                                                   |

 

**ARTICLE 21.MISCELLANEOUS**

 

21.1.                        Governing Law.

 

The validity, interpretation, and performance ofthis Agreement and each of its provisions shall be governed by the laws of theCommonwealth of Kentucky, except that the power and authority of IMPA to enterinto this Agreement shall be governed by the laws of the State of Indiana.

 

21.2.                        Notice To Parties.

 

Unless otherwise specifically provided by other provisionsof this Agreement, any notice, consent, or other communication required to bemade under this Agreement shall be addressed to or made by such officer, agent,representative, or employee of each Party as such Party may, from time to time,designate in writing, provided that any written notice required to be madepursuant to Articles 14, 18, and 19.3 hereof shall be delivered in person, byprepaid telegram, or by registered or certified mail, to the named officer ofthe Party at the address listed below; provided, that either Party may, fromtime to time, change such designated officer or the address thereof by givingwritten notice of such change to the other Party. Any requirement for notice inwriting may be met by telex, telecopy, or other electronic means ofcommunicating written or printed material, if promptly confirmed in writing.

 

TO                               Louisville:

 

President

 

Louisville Gas and Electric Company

 

220 West Main Street (40202)

 

Post Office Box 32010

 

Louisville, Kentucky 40232

 

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TO                               IMPA:

 

General Manager

 

Indiana Municipal Power Agency

 

11610 North College Avenue

 

Carmel, Indiana 46032

 

21.3.                        Article Headings Not ToAffect Meaning.

 

The descriptive headings of the various Articles ofthis Agreement have been inserted for convenience of reference only and shallin no way modify or restrict any of the terms or provisions hereof.

 

21.4.                        Counterparts.

 

This Agreement may be executed simultaneously in twoor more counterparts, each of which shall be deemed an original, but all ofwhich together shall constitute one and the same instrument.

 

21.5.                        Time.

 

Louisville and IMPA agree that time is of theessence in this Agreement.

 

21.6.                        Severability.

 

In the event that any provision of this Agreement,or the application of any such provision to any person or circumstance, shallbe held invalid or unenforceable, the remainder of this Agreement, or theapplication of such provision to persons or circumstances other than those asto which it is held invalid or unenforceable, shall not be affected thereby.

 

21.7.                        Integration.

 

The terms and provisions contained in this Agreementand the Interconnection Agreement constitute the entire agreement betweenLouisville and IMPA in regard to the respective matters of said Agreement, andshall supersede all previous communications, representations, or agreements,either oral or written, between Louisville and IMPA with respect to therespective subject matters of said Agreements.

 

21.8.                        Computation Of Time.

 

In computing any period of time prescribed orallowed by this Agreement, the day of the act, event, or default from which thedesignated period of time begins to run shall

 

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not be included. The lastday of this period so computed shall be included, unless it is a Saturday,Sunday, or legal holiday in Kentucky, in which event the period shall run untilthe end of the next day which is neither a Saturday, Sunday, nor legal holiday.

 

21.9.                        Waiver.

 

Any waiver at any time, by either Party, of itsrights with respect to the other Party, or with respect to any other matterarising in connection with this Agreement, shall not be considered a waiverwith respect to any subsequent default or matter.

 

21.10.                  Equal Opportunity Clause.

 

During the performance of those parts of thisAgreement relating to the construction by a Party of any Incremental CapitalAssets, such Party agrees as follows:

 

(a)                                  Such Party will notdiscriminate against any employee or applicant for employment because of race,color, religion, sex, or national origin. Such Party will take affirmativeaction to insure that applicants are employed, and that employees are treated,during employment, without regard to their race, color, religion, sex, ornational origin. Such action shall include, but not be limited to, thefollowing: employment, upgrading, demotion, or transfer; recruitment orrecruitment advertising; layoff or termination; rates of pay or other forms ofcompensation; and selection for training, including apprenticeship. Such Partyagrees to post, in conspicuous places, available to employees and applicantsfor employment, notices setting forth the provisions of this non-discriminationclause;

 

(b)                                 Such Party will, in allsolicitations or advertisements for employees place by or on behalf of suchParty, state that all qualified applicants will receive consideration foremployment without regard to race, color, religion, sex, or national origin;

 

(c)                                  Such Party will send to eachlabor union or representative of workers with which it has a collectivebargaining agreement or other contract or understanding, a notice, to beprovided, advising the said labor union or workers’ representative, of suchParty’s commitments under this Article 21.10, and shall post copies of thenotice In conspicuous places, available to employees and applicants foremployment;

 

(d)                                 Such Party will comply withall provisions of Executive Order No. 11246 of September 24, 1965, and of therules, regulations, and relevant orders of the Secretary of Labor

 

(e)                                  Such Party will furnish allinformation and reports required by Executive Order No. 11246 of September 24,1965, and by the rules, regulations, and orders of the Secretary of Labor, orpursuant thereto, and will permit access to its books, records, and accounts bythe administering agency and the Secretary of Labor, for purposes ofinvestigation, to ascertain compliance with such rules, regulations, andorders;

 

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(f)                                    In the event of such Party’snoncompliance with the none discrimination clauses of this Agreement, or withany of the said rules, regulations, or orders, this Agreement may be canceled,terminated, or suspended, in whole or in part, and such Party may be declaredineligible for further Government contracts or federally assisted constructioncontracts in accordance with procedures authorized in Executive Order No. 11246of September 24, 1965, and such other sanctions may be imposed and remediesinvoked as provided in said Executive Order or by rule, regulation, or order ofthe Secretary of Labor, or as otherwise provided by law

 

(g)                                 Such Party will includes thewords “During the performance of this contract, the contractor agrees asfollows:” followed by the provisions of sections (a) through (I) of thisArticle 21.10 in every subcontract or purchase order, unless exempted by rules,regulations, or orders or the Secretary of Labor issued pursuant to Section 204of Executive Order No. 11246 of September 24, 1965, so that such provisionswill be binding upon each subcontractor or vendor. Such Party will take suchaction with respect with any subcontract or purchase order as the administeringagency may direct as a means of enforcing such provisions, including sanctionsfor noncompliance; provided, however, that in the event such Party becomesinvolved in, or is threatened with, litigation by a subcontractor or vendor asa result of such direction by the administering agency, such Party may requestthe United States to enter into such litigation to protect the interests of theUnited States;

 

(h)                                 For purposes of thisAgreement, the term “this Agreement,’ as used in this Article 21.10 shall meanthose parts of this Agreement relating to the construction by such Party of anyadditions, betterments, or improvements to the property. Nothing in thisArticle 21.10 shall be construed to prevent such Party from resisting,challenging, contesting, or appealing any law, statute, regulation, or decisionof any federal, state, or local government or agency which such Party claims tobe in invalid, unlawful, arbitrary, or capricious.

 

21.11.                  Non-Segregated Facilities.

 

Each Party certifies further that It will notmaintain or provide for its employees any segregated facilities at any of itsestablishments, and that it will not permit its employees to perform theirservices at any location, under its control, where segregated facilities aremaintained. Each Party agrees that a breach of this certification is aviolation of the Equal Opportunity Clause in this Agreement. As used in thiscertification, the term “segregated facilities’ means any waiting rooms, workareas, rest rooms and washrooms, restaurants, and other eating areas, timeclocks, locker rooms and other storage or dressing areas, parking lots,drinking fountains, recreation or entertainment areas, transportation, orhousing facilities provided for employees which are segregated by explicitdirective or are, in fact, segregated on the basis of race, color, religion, ornational origin, because of habit, local custom, or otherwise. Each Partyagrees that (except where it has obtained identical certifications fromproposed subcontractors for specific time periods) it will obtain identicalcertifications from proposed subcontractors prior to the award of subcontractsexceeding $10,000 which are not exempt from the

 

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provisions of the EqualOpportunity Clause, and that it will retain such certifications in its files.

 

Nothing in this Article 21.11 shall be construed toprevent any Party from resisting, challenging, contesting, or appealing anylaw, statue, regulations, or decision of any federal, state, or localgovernment or agency which the Party claims to be invalid, unlawful, arbitrary,or capricious.

 

21.12.                  Condemnation.

 

In the event any portion of Trimble County Unit 1,or any portion of the Trimble County Site or the Trimble County General PlantFacilities as they pertain to the Parties’ use of Trimble County Unit 1, shallbe condemned and taken by exercise of any right of eminent domain or for publicor quasi-public use, and the Parties hereto are able to continue their use andoperation of the remaining portion thereof, this Agreement shall not terminate.The proceeds of any payment of any award or compensation arising from suchcondemnation (net of any unrecovered expenses of any nature incurred by theParties with respect thereto, which expenses shall be fully reimbursed to theParty or Parties incurring such expenses) shall be apportioned between theOwners on the basis of their respective ownership interests in Trimble CountyUnit 1. In the event that all of Trimble County Unit 1, or all of the TrimbleCounty Site, and the Trimble County General Plant Facilities as they pertain tothe Parties’ use of Trimble County Unit 1, shall be condemned and taken byexercise of any right of eminent domain or for public or quasi-public use, thisAgreement shall terminate as of the date of said taking and the proceeds of anyaward or compensation arising from such condemnation (net of any unrecoveredexpenses of any nature incurred by the Owners with respect thereto, whichexpenses shall be fully reimbursed to the Owner or Owners incurring suchexpenses) shall be apportioned between the Owners on the basis of theirrespective ownership interests in Trimble County Unit 1.

 

**ARTICLE 22.TERM AND TERMINATION**

 

22.1.                        Termination.

 

This Agreement shall terminate at such time as thoseactivities which are necessary to retire Trimble County Unit 1 from servicehave been completed. Retirement from service shall include, without limitation:dismantling, demolishing, and removal of equipment, facilities, and structures;security; maintenance; disposing of debris; and any site work necessary tolawfully and responsibly effect such retirement. Termination of this Agreement,however, shall not terminate or affect, as between the Parties, the continuedliability, if any, of the Parties for environmental considerations or otherobligations imposed by law. •

 

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22.2.                        Retirement Of Property.

 

The Coordination Committee shall have authority indecisions regarding the retirement from service of any and all propertyincluded in Trimble County Unit 1 and Trimble County General Plant Facilitieswhich, in the Coordination Committee’s judgment, is damaged, worn out,uneconomic, unreliable, obsolescent, or otherwise unfit for use. However,Trimble County Unit 1 shall not be retired from service as a generating unitwithout the written consent of IMPA prior to the earlier of:

 

(a)                                  the expiration of 35 yearsfollowing the Commercial Operation Date of Trimble County Unit 1; or

 

(b)                                 the final maturity date ofthe project revenue bonds originally issued by IMPA to finance its initial ownershipinterest in Thimble County Unit 1, or the final maturity date of any bondsissued by IMPA to refund such originally issued bonds.

 

After the expiration of the applicable period in thepreceding sentence, subject to the rights of any other Owner of Trimble CountyUnit 1, the Coordination Committee shall have the right to retire TrimbleCounty Unit 1 from service as a generating unit at any time. Notwithstandingthe above, in the event the Coordination Committee approves a major lifeextension or the installation of Incremental Capital Assets, either of whichcosts in excess of twenty-five percent of the original construction cost of theTrimble County Plant, and IMPA issues improvement or other bonds to financesuch improvements, Louisville agrees, subject to the interests of any co-ownersof Trimble County Unit 1, not to retire such unit prior to the expiration of 75percent of the remaining useful life of such unit as determined by a qualifiedengineering consultant selected by the Coordination Committee.

 

22.3.                        Retirement Costs.

 

All costs (less salvage credits, if any) associatedwith retirement of Trimble County Unit 1 and the Trimble County General PlantFacilities and the Trimble County Site as they pertain to Trimble County Unit1, including, without limitation: dismantling, demolishing, and removal ofequipment, facilities, and structures; security; maintenance; disposing ofdebris; and any site work necessary to lawfully and responsibly effect suchretirement, shall be shared by the Owners in proportion to their respectivepercentage ownership interests in Trimble County Unit 1. Payments for thesecosts (less salvage credits, if any) as they are expected to be incurred, shallbe made In accordance with the provisions of Article 8. If such salvage creditsexceed such costs, the difference shall be shared by the Owners in proportionto their respective percentage ownership Interests in Trimble County Unit 1.

 

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IN WITNESS WHEREOF, each of the Parties has causedthis Agreement to be duly executed.

 
|    |             | LOUISVILLE GAS AND ELECTRIC COMPANY |
|---------|------------------|-------------------------------------|
|    |             |                                |
| Attest: |             |                                | By: |   |   |
|    | Secretary        |                                |   | Chris Hermann, |
|    |             |                                | Vice President and General Manager, |
|    |             |                                | Wholesale Electric Business |
|    |             |                                |
|    |             |                                |
|    |             | INDIANA MUNICIPAL POWER AGENCY      |
| Attest: |             |                                | By: |   |   |
|    | Dwight D. Langer |                                |   | Frank Rudolph, |
|    | Secretary        |                                |   | Chairman |
|         |                  |                                     |  |  |  |  |  |  |

 

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**APPENDICES**

 

Appendices to the Participation Agreement

 
| Appendix A. | Bill of Sale                                                      |
|-------------|-------------------------------------------------------------------|
|        |                                                              |
| Appendix B. | Trimble County Unit No. 1 List                                    |
|        |                                                              |
| Appendix C. | License Agreement and Trimble County General  Plant Facility List |
|        |                                                              |
| Appendix D. | Known Defects at Closing                                          |
|        |                                                              |
| Appendix E. | General Warranty Deed                                             |
|        |                                                              |
| Appendix F. | Easement: Louisville to IMPA                                      |
|        |                                                              |
| Appendix G. | Easement: IMPA to Louisville                                      |

 

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APPENDIX A

 

BILLOF SALE

 

LOUISVILLE GAS AND ELECTRIC COMPANY, a Kentuckycorporation, 220 West Main Street, P.O. Box 32010, Louisville, Kentucky 40232(“Seller”) and INDIANA MUNICIPAL POWER AGENCY, a body corporate and politic anda political subdivision of the State of Indiana, 11610 North College Avenue,Carmel, Indiana 46032 (“Buyer”) for value received and in accordance with thecovenants and conditions set forth in the Participation Agreement by andbetween Seller and Buyer, dated February 1, 1993, and incorporated by referenceherein (“Agreement”) , and as part of the consideration for the performance ofthe Agreement, Seller hereby grants, bargains, transfers, sells and deliversunto Buyer, all of Seller’s right, title and interest in a l2.88~ undividedinterest as a tenant in common in Trimble County Unit 1, as defined in theAgreement and as more particularly described in Appendix B to the Agreement,and pursuant to the terms of the Agreement.

 

Seller hereby represents, warrants and covenants,subject to any rights Illinois Municipal Electric Agency may have as an ownerof a l2.l2% undivided ownership interest as tenant in common to the propertytransferred hereunder, that Seller is the owner of the property described inthis Bill of Sale, and has full right, power and authority to sell and transferthe same.

 

IN WITNESS WHEREOF, the undersigned have executedthis Bill of Sale by their duly authorized officers this 1st day of February,1993.

 
|    |   | SELLER:                              |
|---------|--------|--------------------------------------|
|    |   |                                 |
|    |   | LOUISVILLE GAS AND ELECTRIC  COMPANY |
|    |   |                                 |
| Attest: |   |                                 | By: |   |   |
|    |   |                                 | Chris Hermann, |
|    |   |                                 | Vice President and General |
|    |   |                                 | Manager, Wholesale Electric |
|    |   |                                 | Business |
|    |   |                                 |
|    |   | BUYER:                               |
|    |   |                                 |
|    |   | INDIANA MUNICIPAL POWER  AGENCY      |
|    |   |                                 |
| Attest: |   |                                 | By: |   |   |
|    |   |                                 | Frank R. Rudolph, Chairman |
|         |        |                                      |  |  |  |  |

 

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APPENDIX BTrimble County Unit 1

 

STRUCTURES

 
| A.     |   | Unit Structure                          |
|--------|--------|-----------------------------------------|
|   |   |                                    |
|   |   | 1.                                      | Concrete |
|   |   |                                    | a. | Base Pad Foundation |
|   |   |                                    | b. | Base Pad Finish Floor |
|   |   |                                    | c. | Elevated Floors |
|   |   |                                    | d. | Equipment Foundations |
|   |   |                                    |   |
|   |   | 2.                                      | Steel Structures |
|   |   |                                    | a. | Boiler and Air Preheater Room Steel |
|   |   |                                    | b. | Turbine Room Steel |
|   |   |                                    | c. | Stairways |
|   |   |                                    | d. | Equipment Platforms |
|   |   |                                    |   |
|   |   | 3.                                      | Enclosures |
|   |   |                                    | a. | Partial Insulated Multi-Layer Metal Siding |
|   |   |                                    | b. | Partial Uninsulated Metal Siding |
|   |   |                                    | c. | Concrete & Built-Up Roof |
|   |   |                                    |   |   |
| B.     |   | Draft Equipment                         |
|   |   |                                    |
|   |   | 1.                                      | Concrete |
|   |   |                                    | a. | Equipment Foundations |
|   |   |                                    |   |   |
| C.     |   | Boiler Feed and Service Water Equipment |
|   |   |                                    |
|   |   | 1.                                      | Concrete |
|   |   |                                    | a. | Equipment Foundations |
|   |   |                                    |   |   |
| D.     |   | Coal Mills                              |
|   |   |                                    |   |   |
|   |   | 1.                                      | Concrete |
|   |   |                                    | a. | Equipment Foundations |
|   |   |                                    |   |   |
| E.     |   | Electrostatic Precipitator              |
|   |   |                                    |   |   |
|   |   | 1.                                      | Concrete |
|   |   |                                    | a. | Foundations |
|   |   |                                    | b. | Base Slab |
|   |   |                                    |   |   |
|   |   | 2.                                      | Steel Structures |

 

61

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|   |   |                           | a.               | Columns & Girders        |
|--------|--------|--------------------------------|------------------|------------------------------|
|   |   |                           | b.               | Stairways                    |
|   |   |                           |             |                         |
|   |   | 3.                             | Enclosures       |
|   |   |                           | a.               | Metal Siding                 |
|   |   |                           | b.               | ESP End Walls                |
|   |   |                           |             |                         |
| F.     |   | Sulphur Dioxide Removal System |
|   |   |                           |             |                         |
|   |   | 1.                             | Concrete         |
|   |   |                           | a.               | Foundations                  |
|   |   |                           | b.               | Base Slab                    |
|   |   |                           | c.               | Equipment Foundations        |
|   |   |                           |             |                         |
|   |   | 2.                             | Steel Structures |
|   |   |                           | a.               | Columns & Girders        |
|   |   |                           | b.               | Stairways                    |
|   |   |                           |             |                         |
|   |   | 3.                             | Enclosures       |
|   |   |                           | a.               | Insulated Metal Siding       |
|   |   |                           | b.               | Concrete & Built-Up Roof |
|   |   |                           |             |                         |
| G.     |   | Bottom Ash Handling            |
|   |   |                           |             |                         |
|   |   | 1.                             | Concrete         |
|   |   |                           |             |                         |
|   |   |                           | a.               | Equipment Foundations        |
|   |   |                           |             |                         |
| H.     |   | Turbine Generator              |
|   |   |                           |             |                         |
|   |   | 1.                             | Concrete         |
|   |   |                           | a.               | Equipment Foundations        |
|   |   |                           |             |                         |
| I.     |   | Boiler                         |
|   |   |                           |             |                         |
|   |   | 1.                             | Steel Structures |
|   |   |                           | a.               | Support Steel                |

 

62

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EQUIPMENT AND SYSTEM COMPONENTS

 
| A.     |   | Unit Structure                          |
|--------|--------|-----------------------------------------|
|   |   |                                    |
|   |   | 1.                                      | Masonry Blockwork |
|   |   | 2.                                      | HVAC |
|   |   | 3.                                      | Roof Drains |
|   |   | 4.                                      | Passenger Elevator |
|   |   | S.                                      | Conduit & Cable Tray |
|   |   | 6.                                      | Lighting |
|   |   | 7.                                      | 6900 Volt Equipment |
|   |   | 8                                       | 480 Volt Equipment |
|   |   | 9.                                      | 208/110 Volt Equipment |
|   |   | 10.                                     | Control & Logic Room |
|   |   | 11.                                     | Batteries & Chargers |
|   |   | 12.                                     | Uninterruptible Power Supply |
|   |   | 13.                                     | Station Fuel Oil Piping |
|   |   | 14.                                     | Ignition Oil Piping |
|   |   | 15.                                     | Main Steam Piping |
|   |   | 16.                                     | Hot & Cold Reheat Piping |
|   |   | 17.                                     | Condensate Piping |
|   |   | 18.                                     | Gland Seal Piping |
|   |   | 19.                                     | Attemperator Piping |
|   |   | 20.                                     | Boiler Feed Suction Piping |
|   |   | 21.                                     | Extraction Steam Piping |
|   |   | 22.                                     | Auxiliary Cooling Piping |
|   |   | 23.                                     | Closed Cooling Piping |
|   |   | 24.                                     | Compressor and Instrument Air Piping |
|   |   | 25.                                     | House Air Piping |
|   |   | 26.                                     | Condensate Makeup Piping |
|   |   | 27.                                     | Fire Protection |
|   |   | 28.                                     | Turbine Room Gantry and House Cranes |
|   |   | 29.                                     | Coal Silos |
|   |   |                                    |   |
| B.     |   | Draft Equipment                         |
|   |   |                                    |   |
|   |   | 1.                                      | Inducted Draft Fans |
|   |   | 2.                                      | Forced Draft Fans |
|   |   | 3                                       | Primary Air Fans |
|   |   | 4                                       | Air & Gas Ducts |
|   |   | 5                                       | Air Heater |
|   |   |                                    |   |
| C.     |   | Boiler Feed and Service Water Equipment |

 

63

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|   |   | 1                              | Motor Driven Feed Pumps   |
|--------|--------|--------------------------------|---------------------------|
|   |   | 2                              | Turbine Driven Feed Pumps |
|   |   | 3.                             | Feedwater Heaters         |
|   |   | 4.                             | Cooling Pumps             |
|   |   |                           |                      |
| D.     |   | Coal Mills                     |
|   |   |                           |                      |
|   |   | 1.                             | Coal Mills                |
|   |   | 2.                             | Feeders                   |
|   |   |                           |                      |
| E.     |   | Electrostatic Precipitator     |
|   |   |                           |                      |
|   |   | 1.                             | Precipitator              |
|   |   |                           | a.                        | Elements |
|   |   |                           | b.                        | Hoppers |
|   |   |                           | c.                        | Vibrations |
|   |   |                           |                      |
|   |   | 2.                             | HVAC                      |
|   |   | 3.                             | Fire Protection Equipment |
|   |   | 4.                             | Insulation                |
|   |   | 5.                             | 480 Volt Equipment        |
|   |   | 6.                             | 208/110 Volt Equipment    |
|   |   | 7.                             | Conduit & Cable Tray  |
|   |   | 8.                             | Lighting                  |
|   |   | 9.                             | Communications            |
|   |   | 10.                            | Control Building          |
|   |   | 11.                            | Piping Systems            |
|   |   |                           |                      |
| F.     |   | Sulphur Dioxide Removal System |
|   |   |                           |                      |
|   |   | 1.                             | Inlet & Outlet Ducts  |
|   |   | 2.                             | Absorber                  |
|   |   | 3.                             | Demister Wash Equipment   |
|   |   | 4.                             | Seal Water Tank           |
|   |   | 5.                             | Control Building          |
|   |   | 6.                             | Electrical Building       |
|   |   | 7.                             | Horizontal Pumps          |
|   |   | 8.                             | Seal Air Fans             |
|   |   | 9.                             | Air Compressors           |
|   |   | 10.                            | Heat Exchangers           |
|   |   | 11.                            | Cranes & Hoists       |
|   |   | 12.                            | Piping Systems            |
|   |   | 13.                            | 6900 Volt Equipment       |
|   |   | 14.                            | 480 Volt Equipment        |
|   |   | 15.                            | 208/110 Volt Equipment    |
|   |   | 16.                            | Lighting                  |
|   |   | 17.                            | Communications            |

 

64

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|   |   | 18.                 | Multiplex System          |
|--------|--------|---------------------|---------------------------|
|   |   |                |                      |
| G.     |   | Bottom Ash Handling |
|   |   |                |                      |
|   |   | 1.                  | Hoppers                   |
|   |   | 2.                  | Ash Sluicing Equipment    |
|   |   | 3.                  | Piping System             |
|   |   | 4.                  | Bottom Ash Equipment      |
|   |   |                |                      |
| H.     |   | Turbine Generator   |
|   |   |                |                      |
|   |   | 1.                  | Turbine Generator         |
|   |   | 2.                  | Piping Systems            |
|   |   | 3.                  | Seal Oil Unit             |
|   |   | 4.                  | Hydrogen Coolers          |
|   |   | S.                  | Turbine Oil System        |
|   |   | 6.                  | Electro Hydraulic Control |
|   |   | 7.                  | Multiplex System          |
|   |   | 8.                  | Isolated Phase Bus        |
|   |   |                |                      |
| I.     |   | Boiler              |
|   |   |                |                      |
|   |   | 1.                  | Boiler *                  |
|   |   | 2.                  | Economizer                |
|   |   | 3.                  | Superheat/Reheat Panels   |
|   |   | 4.                  | Water Walls               |
|   |   | 5.                  | Heater Drains & Vents |
|   |   | 6.                  | Sootblowers               |
|   |   | 7.                  | Burners                   |

 

65

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APPENDIX C

 

LICENSE AGREEMENT

 

THIS AGREEMENT made and entered into as ofthis 1st day of February, 1993, by and between LOUISVILLE GAS AND ELECTRICCOMPANY, a Kentucky corporation, having its principal office at 220 West MainStreet, P.O. Box 32010, Louisville, Kentucky 40202, (“Louisville or Licensor”)and Indiana Municipal Power Agency, a body corporate and politic and apolitical subdivision of the State of Indiana, having its principal offices at11610 North College Avenue, Cannel, Indiana 46032 (“IMPA or Licensee~)

 

WITNESSETH:

 

WHEREAS Louisville is the owner of theTrimble County Plant which includes Trimble County Unit 1, the Trimble CountyGeneral Plant Facilities and the Trimble County Site; and

 

WHEREAS Illinois Municipal Electric Agency(“IMEA”) owns an undivided 12.12 percent interest in Trimble County Unit 1; and

 

WHEREAS pursuant to the ParticipationAgreement dated February 1, 1993, by and between Louisville and IMPA (the“Participation Agreement”), the terms of which are incorporated by referenceherein, Louisville has sold to IMPA, and IMPA has purchased from Luisville a 12.88%undivided ownership interest in Trimble County Unit 1 as tenants in common; and

 

WHEREAS IMPA desires to obtain a nonexclusivelicense to use the Trimble County General Plant Facilities on the TrimbleCounty Site in a manner consistent with IMPA’s ownership interest and so longas it may hold its interest in Trimble County Unit 1.

 

NOW THEREFORE, in consideration of the mutualcovenants and promises herein contained, the parties agree as follows:

 

1.                                      DEFINITIONS:

 

The terms Trimble County Unit 1, TrimbleCounty General Plant Facilities, Trimble County Site and Trimble County Plantas used herein shall be defined as set forth in the Participation Agreement.

 

2.                                      GRANT:

 

Upon the terms, payments and conditions setforth in the Participation Agreement, incorporated herein by reference,Louisville hereby grants to IMPA a nonexclusive license to use the TrimbleCounty General Plant Facilities to the extent necessary for efficient and fulluse by IMPA of its proportional ownership interest in Trimble County Unit 1.Louisville shall retain full ownership of the Trimble County General PlantFacilities.

 

66

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3.                                      USE

 

a)                                     IMPA covenantsthat its use of the Trimble County General Plant Facilities pursuant to thelicense granted herein will be consistent with the Participation Agreement andotherwise in full compliance with all applicable laws, ordinances, statutes,codes, easements and restrictions.

 

b)                                    IMPA acknowledgesthat this nonexclusive license shall in no way restrict or prohibit Louisvillefrom constructing additional units or facilities or expanding present units orfacilities in a manner consistent with the Participation Agreement.

 

4.                                      DURATION ANDTERMINATION

 

Unless otherwise terminated by mutualagreement of the parties, this Agreement and the license granted herein shallcontinue in full force and effect until the expiration or termination of theParticipation Agreement.

 

5.                                      NOTICES

 

All notices, requests and demands and othercommunications given or made in connection with this Agreement, shall be givenor made pursuant to and, in accordance with, the Participation Agreement.

 

6.                                      CONSTRUCTIONAND ASSIGNMENT

 

a)                                     This Agreementshall be binding on and inure to the benefit of the Licensor, its legalrepresentatives, successors, heirs and assigns.

 

b)                                    This Agreementshall be binding on and inure to the benefit of the Licensee, but shall not betransferable or assignable by the Licensee except as permitted by andconsistent with the Participation Agreement.

 

c)                                     This Agreementshall be deemed to be a contract made under the laws of the Commonwealth ofKentucky, and shall be construed and interpreted according to the laws of saidstate.

 

7.                                      MODIFICATION:

 

This Agreement and the ParticipationAgreement embody all the understandings and obligations between the partieswith respect to the subject matter hereof. No amendment or modification of thisAgreement shall be valid or binding upon the parties unless made in writing andsigned on behalf of each of the parties by their respective proper officers,duly authorized.

 

IN WITNESS WHEREOF, the parties caused thisAgreement to be executed as of the date first written above.

 

67

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|   | LOUISVILLE GAS AND ELECTRIC COMPANY |
|--------|-------------------------------------|
|   |                                |
|   | By:                                 |   |   |
|   |                                | Chris |
|   |                                | Vice President and General Manager, |
|   |                                | Wholesale Electric Business |
|   |                                |
|   |                                |
|   | INDIANA MUNICIPAL POWER AGENCY      |
|   |                                |
|   | By                                  |   |   |
|   |                                | Frank R. Rudolph, |
|   |                                | Chairman |
|        |                                     |  |  |  |  |

 

68

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List of Trimble County GeneralPlant Facilities

 

STRUCTURES

 
| A.     |   | Service Building      |
|--------|--------|-----------------------|
|   |   | 1.                    | Concrete |
|   |   |                  | a. | Foundations |
|   |   |                  | b. | Base Slab |
|   |   |                  | c. | Elevated Floors |
|   |   |                  | d. | Unloading Ramps |
|   |   | 2.                    | Steel Structures |
|   |   |                  | a. | Columns & Girders |
|   |   | 3.                    | Enclosures |
|   |   |                  | a. | Insulated Metal Siding |
|   |   |                  | b. | Glass Curtain Wall |
|   |   |                  | c. | Concrete & Built-Up Roof |
|   |   |                  |   |   |
| B.     |   | As Fired Sample House |
|   |   | 1.                    | Concrete |
|   |   |                  | a. | Foundations |
|   |   |                  | b. | Base Slab |
|   |   |                  | c. | Elevated Floors |
|   |   |                  |   |   |
|   |   | 2.                    | Steel Structures |
|   |   |                  | a. | Columns & Girders |
|   |   |                  | b. | Stairways |
|   |   |                  | c. | Grating |
|   |   | 3.                    | Enclosures |
|   |   |                  | a. | Insulated Metal Siding |
|   |   |                  | b. | Concrete & Built-Up Roofing |
|   |   |                  |   |   |
| C.     |   | Screenwell            |
|   |   | 1.                    | Piles |
|   |   |                  | a. | Sheet Piles |
|   |   |                  | b. | H-Piles |
|   |   | 2.                    | Concrete |
|   |   |                  | a. | Walls |
|   |   |                  | b. | Elevated Floors |
|   |   | 3.                    | Steel Structures |
|   |   |                  | a. | Columns & Girders |
|   |   |                  | b. | Miscellaneous Platforms |
|   |   | 4.                    | Enclosures |
|   |   |                  | a. | Insulate Metal Siding |
|   |   |                  | b. | Concrete & Built-Up Roof |
|   |   |                  |   |   |
| D.     |   | Stack                 |
|   |   | 1.                    | Concrete |

 

69

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|                      |   |                                  | a.               | Foundations                     |
|---------------------------|--------|---------------------------------------|------------------|---------------------------------|
|                      |   |                                  | b.               | Base Slab                       |
|                      |   |                                  | c.               | Concrete Shell & Liner      |
|                      |   |                                  |             |                            |
| E.                        |   | Coal Handling                         |
|                      |   |                                  |             |                            |
| Barge Unloader            |
|                      |   | 1.                                    | Piles            |                            |
|                      |   |                                  | a.               | Sheet Piles                     |
|                      |   |                                  | b.               | H-Piles                         |
|                      |   |                                  |             |                            |
|                      |   | 2.                                    | Steel Structures |
|                      |   |                                  | a.               | Columns & Girders           |
|                      |   |                                  | b.               | Stairways                       |
|                      |   |                                  |             |                            |
| Transfer House            |
|                      |   |                                  |             |
|                      |   | 1.                                    | Concrete         |
|                      |   |                                  | a.               | Foundations                     |
|                      |   |                                  | b.               | Base Slab                       |
|                      |   |                                  |             |                            |
|                      |   | 2.                                    | Steel Structures |
|                      |   |                                  |             |                            |
|                      |   |                                  | a.               | Columns & Girders           |
|                      |   |                                  |             |                            |
|                      |   | 3.                                    | Enclosures       |
|                      |   |                                  | a.               | Uninsulated Metal Siding        |
|                      |   |                                  | b.               | Concrete & Built-Up         |
|                      |   |                                  |             |                            |
| As Delivered Sample House |
|                      |   |                                  |             |                            |
|                      |   | 1.                                    | Concrete         |
|                      |   |                                  | a.               | Foundations                     |
|                      |   |                                  | b.               | Base Slab                       |
|                      |   |                                  | c.               | Elevated Floors                 |
|                      |   |                                  | d.               | Equipment Foundations           |
|                      |   |                                  |             |                            |
|                      |   | 2.                                    | Steel Structures |
|                      |   |                                  | a.               | Columns & Girders           |
|                      |   |                                  |             |                            |
|                      |   | 3.                                    | Enclosures       |
|                      |   |                                  | a.               | Uninsulated Metal Siding        |
|                      |   |                                  | b.               | Concrete & Built-Up Roofing |
|                      |   |                                  |             |                            |
|                      |   | Coal Dock Electrical Service Building |
|                      |   |                                  |             |                            |
|                      |   | 1.                                    | Concrete         |

 

70

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|                        |   |   | a.               | Foundations                                                 |
|-----------------------------|--------|--------|------------------|-------------------------------------------------------------|
|                        |   |   | b.               | Base Slab                                                   |
|                        |   |   |             |                                                        |
|                        |   | 2.     | Steel Structures |
|                        |   |   | a.               | Pre-Engineered Building                                     |
|                        |   |   |             |                                                        |
| Radial Stacker              |
|                        |   |   |             |                                                        |
|                        |   | 1.     | Concrete         |
|                        |   |   | a.               | Base Slab Rail                                              |
|                        |   |   |             |                                                        |
| Reclaim Hopper & Tunnel |
|                        |   |   |             |                                                        |
|                        |   | 1.     | Concrete         |
|                        |   |   | a.               | Foundations                                                 |
|                        |   |   | b.               | Base Slab                                                   |
|                        |   |   | c.               | Wails                                                       |
|                        |   |   | d.               | Elevated Slab                                               |
|                        |   |   | e.               | Access Stairway                                             |
|                        |   |   |             |                                                        |
| Crusher House               |
|                        |   |   |             |                                                        |
|                        |   | 1.     | Concrete         |
|                        |   |   | a.               | Foundations                                                 |
|                        |   |   | b.               | Base Slab                                                   |
|                        |   |   | c.               | Elevated Floors                                             |
|                        |   |   | d.               | Equipment Foundations                                       |
|                        |   |   |             |                                                        |
|                        |   | 2.     | Steel Structures |
|                        |   |   | a.               | Columns & Girders K Stairways                           |
|                        |   |   |             |                                                        |
|                        |   | 3.     | Enclosures       |
|                        |   |   | a.               | Uninsulated Metal Siding Crusher House  Electrical Building |
|                        |   |   |             |                                                        |
|                        |   | 1.     | Concrete         |
|                        |   |   | a.               | Foundations                                                 |
|                        |   |   | b.               | Base Slab                                                   |
|                        |   |   |             |                                                        |
|                        |   | 2.     | Steel Structures |
|                        |   |   | a.               | Pre-Engineered Building                                     |
|                        |   |   |             |                                                        |
| Coal Maintenance Building   |
|                        |   |   |             |                                                        |
|                        |   | 1.     | Concrete         |
|                        |   |   | a.               | Foundations                                                 |

 

71

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|                             |   |                             | b.               | Base Slab                         |
|----------------------------------|--------|----------------------------------|------------------|-----------------------------------|
|                             |   |                             |             |                              |
|                             |   | 2.                               | Steel Structures |
|                             |   |                             | a.               | Pre-Engineered Building           |
|                             |   |                             |             |                              |
| Conveyors A, B, C, D, E, & S |
|                             |   |                             |             |                              |
|                             |   | 1.                               | Piles            |                              |
|                             |   |                             | a.               | Bearing Piles                     |
|                             |   |                             |             |                              |
|                             |   | 2.                               | Concrete         |
|                             |   |                             | a.               | Foundations                       |
|                             |   |                             |             |                              |
|                             |   | 3.                               | Steel Structures |
|                             |   |                             | a.               | Steel Trusses                     |
|                             |   |                             | b.               | Conveyor Bents                    |
|                             |   |                             | C.               | Stairways                         |
|                             |   |                             |             |                              |
|                             |   | 4.                               | Enclosures       |
|                             |   |                             | a.               | Conveyor Uninsulated Metal Siding |
|                             |   |                             |             |                              |
| Conveyors Fl, F2, Gi, and G2     |
|                             |   |                             |             |                              |
|                             |   | 1.                               | Concrete         |
|                             |   |                             | a.               | Foundations                       |
|                             |   |                             |             |                              |
|                             |   | 2.                               | Steel Structures |
|                             |   |                             | a.               | Steel Trusses                     |
|                             |   |                             | b.               | Conveyor Bents                    |
|                             |   |                             | c.               | Stairways                         |
|                             |   |                             | d.               | Gallery Steel Enclosure           |
|                             |   |                             |             |                              |
|                             |   | 3.                               | Enclosures       |
|                             |   |                             | a.               | Gallery Uninsulated Metal Siding  |
|                             |   |                             |             |                              |
| F.                               |   | Reactant Handling Barge Unloader |
|                             |   |                             |             |                              |
|                             |   | 1. Piles                         |
|                             |   |                             | a.               | Sheet Piles                       |
|                             |   |                             | b.               | H-Piles                           |
|                             |   |                             |             |                              |
|                             |   | 2.                               | Steel Structures |
|                             |   |                             | a.               | Columns & Girders             |
|                             |   |                             | b.               | Stairways                         |
|                             |   |                             |             |                              |
|                             |   | 3.                               | Enclosures       |

 

72

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|                       |   |        | a.               | Uninsulated Metal Siding |
|----------------------------|--------|-------------|------------------|--------------------------|
|                       |   |        |             |                     |
| Transfer House             |
|                       |   |        |             |                     |
|                       |   | 1. Concrete |
|                       |   |        | a.               | Foundations              |
|                       |   |        | b.               | Base Slab                |
|                       |   |        | c.               | Elevated Floors          |
|                       |   |        |             |                     |
|                       |   | 2.          | Steel Structures |
|                       |   |        | a.               | Columns & Girders    |
|                       |   |        |             |                     |
|                       |   | 3.          | Enclosures       |
|                       |   |        | a.               | Insulated Metal Siding   |
|                       |   |        |             |                     |
| Live Action Pile Enclosure |
|                       |   |        |             |                     |
|                       |   | 1.          | Concrete         |
|                       |   |        | a.               | Foundations              |
|                       |   |        | b.               | Base Slab - Rail         |
|                       |   |        |             |                     |
|                       |   | 2.          | Steel Structures |
|                       |   |        | a.               | A-Frame Structural Steel |
|                       |   |        |             |                     |
|                       |   | 3.          | Enclosures       |
|                       |   |        | a.               | Uninsulated Metal Siding |
|                       |   |        |             |                     |
| Dead Storage Pile          |
|                       |   |        |             |                     |
|                       |   | 1.          | Concrete         |
|                       |   |        | a.               | Foundations              |
|                       |   |        | b.               | Base Slabs               |
|                       |   |        | c.               | Walls                    |
|                       |   |        | d.               | Elevated Slab            |
|                       |   |        | e.               | Access Stairway          |
|                       |   |        |             |                     |
| Conveyors A, B, and C      |
|                       |   |        |             |                     |
|                       |   | 1.          | Concrete         |
|                       |   |        | a.               | Foundations              |
|                       |   |        |             |                     |
|                       |   | 2.          | Steel Structures |
|                       |   |        | a.               | Steel Trusses            |
|                       |   |        | b.               | Conveyor Bents           |
|                       |   |        | c.               | Stairways                |

 

73

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| Reactant Prep. Building     |
|-----------------------------|
|                        |   |   |   |   |
|                        |   | 1. | Concrete |
|                        |   |   | a. | Foundations |
|                        |   |   | b. | Base Slab |
|                        |   |   | c. | Elevated Floors |
|                        |   |   | d. | Equipment Foundations |
|                        |   |   |   |   |
|                        |   | 2. | Steel Structures |
|                        |   |   | a. | Columns & Girders |
|                        |   |   | b. | Stairways |
|                        |   |   |   |   |
|                        |   | 3. | Enclosures |
|                        |   |   | a. | Insulated Metal Siding |
|                        |   |   | b. | Concrete & Built-Up Roofing |
|                        |   |   |   |   |
| Reactant Live Storage Tanks |
|                        |
|                        |   | 1. | Concrete |
|                        |   |   | a. | Foundations |
|                        |   |   |   |   |
|                        |   | 2. | Steel Structures |
|                        |   |   | a. | Carbon Steel Tanks |
|                        |   |   |   |   |
| G.                          |   | Water Treatment Building |
|                        |   | 1. | Concrete |
|                        |   |   | a. | Foundations |
|                        |   |   | b. | Base Slabs |
|                        |   |   | c. | Walls |
|                        |   |   | d. | Equipment Foundations |
|                        |   |   |   |   |
|                        |   | 2. | Steel Structures |
|                        |   |   | a. | Columns & Girders |
|                        |   |   | b. | Stairways |
|                        |   |   | c. | Equipment Platforms |
|                        |   |   |   |   |
|                        |   | 3. | Enclosures |
|                        |   |   | a. | Insulated Metal Siding |
|                        |   |   |   |   |
| H.                          |   | Cooling Tower |
|                        |   |   |   |   |
|                        |   | 1. Concrete |
|                        |   |   | a. | Foundations |
|                        |   |   | b. | Base Slabs |
|                        |   |   | c. | Poured Hyperbolic Natural Draft Tows |

 

74

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|   |   | I.          | Station Auxiliary |
|--------|--------|-------------|-------------------|
|   |   |        |              |   |
|   |   | 1. Concrete |
|   |   |        |              |   |
|   |   |        | a.                | Equipment Foundations |

 

 
| EQUIPMENT AND SYSTEM COMPONENTS |
|---------------------------------|
|                            |
| A.                              | Service Building |
|                            |
|                            | 1. | Masonry Blockwork |
|                            | 2. | Fire Protection Equipment |
|                            | 3. | Restrooms, Lockers, and Showers |
|                            | 4. | HVAC |
|                            | 5. | Roof Drains and Plumbing |
|                            | 6. | Lighting |
|                            | 7. | Communications |
|                            | 8. | Office, Lab, and Kitchen Equipment |
|                            | 9. | Maintenance Shop Equipment |
|                            | 10. | Material Storage Bins and Shelves |
|                            | 11. | Freight Elevator |
|                            | 12. | Passenger Elevator |
|                            |   |   |
| B.                              | As Fired Sample House |
|                            |   |   |
|                            | 1. | HVAC |
|                            | 2. | Building Drains |
|                            | 3. | Fire Protection |
|                            | 4. | Lighting |
|                            | 5. | Communications |
|                            | 6. | Coal Silos |
|                            | 7. | Piping Systems |
|                            |   |   |
| C.                              | Screenwell |
|                            |   |   |
|                            | 1. | Masonry Blockwork |
|                            | 2. | Multiplex System |
|                            | 3. | HVAC |
|                            | 4. | Horizontal Pumps |
|                            | 5. | Vertical Pumps |
|                            | 6. | Traveling Water Screens |
|                            | 7. | Stop Log Gates and Screens |
|                            | 8. | Bridge Crane |
|                            | 9. | Strainers |
|                            | 10. | 480 Volt Equipment |

 

75

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|                                  | 11.           | 208/110 Volt Equipment                |
|---------------------------------------|---------------|---------------------------------------|
|                                  | 12.           | Conduit and Cable Tray                |
|                                  | 13.           | Lighting                              |
|                                  | 14.           | Communications                        |
|                                  | 15.           | Multiplex System                      |
|                                  | 16.           | Roof Drains and Plumbing              |
|                                  |          |                                  |
| D.                                    | Stack         |
|                                  |          |                                  |
|                                  | 1.            | Communications                        |
|                                  |          |                                  |
| E.                                    | Coal Handling |
|                                  |          |                                  |
|                                  | 1.            | Coal Barge Unloader                   |
|                                  | 2.            | Conduit and Cable Tray                |
|                                  | 3.            | Lighting                              |
|                                  | 4.            | Communications                        |
|                                  |          |                                  |
| Transfer House                        |
|                                  |          |                                  |
|                                  | 1.            | Barge Unloader Bin                    |
|                                  | 2.            | Feeders and Chutes                    |
|                                  | 3.            | Dust Collection/Suppression Equipment |
|                                  | 4.            | Sprinkler System                      |
|                                  | 5.            | Monorail and Trolley Hoist            |
|                                  | 6.            | Conduit and Cable Tray                |
|                                  | 7.            | Lighting                              |
|                                  | 8.            | Communications                        |
|                                  |          |                                  |
| As Delivered Sample House             |
|                                  |          |                                  |
|                                  | 1.            | Feeders and Chutes                    |
|                                  | 2.            | Dust Collection/Suppression Equipment |
|                                  | 3.            | As Delivered Sampling System          |
|                                  | 4.            | Sprinkler System                      |
|                                  | 5.            | Control Room - Static Wall Siding     |
|                                  | 6.            | Fire Protection System                |
|                                  | 7.            | Conduit and Cable Tray                |
|                                  | 8.            | Lighting                              |
|                                  | 9.            | Communications                        |
|                                  |          |                                  |
| Coal Dock Electrical Service Building |
|                                  |          |                                  |
|                                  | 1.            | Masonry Blockwork                     |
|                                  | 2.            | Suspended Ceiling                     |
|                                  | 3.            | Static Wall Siding                    |

 

76

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|                              | 4.          | HVAC                                  |
|-----------------------------------|-------------|---------------------------------------|
|                              | 5.          | Fire Protection System                |
|                              | 6.          | Domestic Piping                       |
|                              | 7.          | Conduit and Cable Tray                |
|                              | 8.          | Lighting                              |
|                              | 9.          | Communications                        |
|                              | 10.         | 4160 Volt Equipment                   |
|                              | 11.         | 480 Volt Equipment                    |
|                              | 12.         | 208/110 Volt Equipment                |
|                              | 13.         | Multiplex System                      |
|                              |        |                                  |
| Radial Stacker                    |
|                              |        |                                  |
|                              | I.          | Radial Stacker                        |
|                              | 2.          | HVAC Equipment                        |
|                              | 3.          | Unit Substation                       |
|                              | 4.          | Motor Control Centers                 |
|                              |        |                                  |
| Reclaim Hopper and Tunnel         |
|                              |        |                                  |
|                              | 1. Hopper   |
|                              | 2.          | Feeders and Chutes                    |
|                              | 3.          | Vertical Pumps                        |
|                              | 4.          | Conduit and Cable Tray                |
|                              | 5. Lighting |
|                              |        |                                  |
| Crusher House                     |
|                              |        |                                  |
|                              | 1.          | Feeders and Chutes                    |
|                              | 2.          | Crusher Bin                           |
|                              | 3.          | Dust Collection/Suppression Equipment |
|                              | 4.          | Magnetic Separators and Scales        |
|                              | 5.          | Crusher                               |
|                              | 6.          | Conduit and Cable Tray                |
|                              | 7.          | Lighting                              |
|                              | 8.          | Communications                        |
|                              | 9.          | Piping Systems                        |
|                              |        |                                  |
| Crusher House Electrical Building |
|                              |        |                                  |
|                              | 1.          | Masonry Walls                         |
|                              | 2.          | Static Wall Siding                    |
|                              | 3.          | Fire Protection Equipment             |
|                              | 4.          | Domestic Water                        |
|                              | 5.          | Conduit and Cable Tray                |
|                              | 6.          | Lighting                              |
|                              | 7.          | Communications                        |

 

77

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|                       | 8.                               | Piping Systems           |
|----------------------------|----------------------------------|--------------------------|
|                       | 9.                               | 4160 Volt Equipment      |
|                       | 10.                              | 480 Volt Equipment       |
|                       | 11.                              | 208/110 Volt Equipment   |
|                       | 12.                              | Multiplex System         |
|                       |                             |                     |
| Coal Maintenance Building  |
|                       |                             |                     |
|                       | 1.                               | Masonry Blockwork        |
|                       | 2.                               | Suspended Ceiling        |
|                       | 3.                               | Dry Wall Partitions      |
|                       | 4.                               | HVAC                     |
|                       | 5.                               | Sprinkler System         |
|                       | 6.                               | Hoist and Lifts          |
|                       |                             |                     |
| F.                         | Reactant Handling Barge Unloader |
|                       |                             |                     |
|                       | 1.                               | Limestone Barge Unloader |
|                       | 2.                               | Conduit and Cable Tray   |
|                       | 3.                               | Lighting                 |
|                       | 4.                               | Communications           |
|                       |                             |                     |
| Transfer House             |
|                       |                             |                     |
|                       | 1.                               | Feeders                  |
|                       | 2.                               | Hoppers                  |
|                       | 3.                               | Piping Systems           |
|                       | 4.                               | Conduit and Cable Tray   |
|                       | 5.                               | Lighting                 |
|                       |                             |                     |
| Live Active Pile Enclosure |
|                       |                             |                     |
|                       | 1.                               | Reclaimer                |
|                       | 2.                               | Conduit and Cable Tray   |
|                       | 3.                               | Lighting                 |
|                       |                             |                     |
| Dead Storage Pile          |
|                       |                             |                     |
|                       | 1.                               | Hopper                   |
|                       | 2.                               | Chutes and Feeders       |
|                       | 3.                               | Sump Pumps               |
|                       | 4.                               | Conduit and Cable Tray   |
|                       | S.                               | Lighting                 |
|                       |                             |                     |
| Reactant Prep. Building    |

 

78

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|                        | 1.                       | Masonry Blockwork                  |
|-----------------------------|--------------------------|------------------------------------|
|                        | 2.                       | HVAC Equipment                     |
|                        | 3.                       | Fire Protection Equipment          |
|                        | 4.                       | Piping Systems                     |
|                        | 5.                       | Limestone Crushers and Hoppers     |
|                        | 6.                       | Compressors                        |
|                        | 7.                       | Lube Oil Systems                   |
|                        | 8.                       | Feeders and Chutes                 |
|                        | 9.                       | Bridge Crane                       |
|                        | 10.                      | 4160 Volt Equipment                |
|                        | 11.                      | 480 Volt Equipment                 |
|                        | 12.                      | 208/110 Volt Equipment             |
|                        | 13.                      | Conduit and Cable Tray             |
|                        | 14.                      | Lighting                           |
|                        | 15.                      | Communications                     |
|                        | 16.                      | Multiplex System                   |
|                        |                     |                               |
| Reactant Live Storage Tanks |
|                        |                     |                               |
|                        | 1.                       | Tank Agitators                     |
|                        |                     |                               |
| G.                          | Water Treatment Building |
|                        |                     |                               |
|                        | 1.                       | Masonry Blockwork                  |
|                        | 2.                       | Static Wall Siding                 |
|                        | 3.                       | HVAC                               |
|                        | 4.                       | Fire Protection Equipment          |
|                        | S.                       | Monorail                           |
|                        | 6.                       | Piping Systems                     |
|                        | 7.                       | Sanitary Waste Treatment Equipment |
|                        | 8.                       | Water Treatment Equipment          |
|                        | 9.                       | Condensate Storage Tank            |
|                        | 10.                      | Conduit and Cable Tray             |
|                        | 11.                      | 4160 Volt Equipment                |
|                        | 12.                      | 480 Volt Equipment                 |
|                        | 13.                      | 208/110 Volt Equipment             |
|                        | 14.                      | Lighting                           |
|                        | 15.                      | Communications                     |
|                        | 16.                      | Multiplex System                   |
|                        | 17.                      | Motor Driven Fire Pump             |
|                        | 18.                      | Chemical Injection Equipment       |
|                        | 19.                      | Demineralizer Water System         |
|                        |                     |                               |
| H.                          | Cooling Tower            |
|                        |                     |                               |
|                        | 1.                       | Cooling Tower Pumps                |

 

79

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|                                     | 2.                                | Circulating Water Lines                                      |
|------------------------------------------|-----------------------------------|--------------------------------------------------------------|
|                                     | 3.                                | Condenser                                                    |
|                                     | 4.                                | 480 Volt Equipment                                           |
|                                     | 5.                                | Lighting                                                     |
|                                     | 6.                                | Communications                                               |
|                                     |                              |                                                         |
| I.                                       | Station Auxiliary                 |
|                                     |                              |                                                         |
|                                     | 1.                                | 138 Volt Equipment                                           |
|                                     | 2.                                | 6900 Volt Equipment                                          |
|                                     | 3.                                | 480 Volt Equipment                                           |
|                                     | 4.                                | 208/110 Volt Equipment                                       |
|                                     | 5.                                | Sprinkler System                                             |
|                                     |                              |                                                         |
| OTHER EQUIPMENT, SYSTEMS, AND STRUCTURES |
|                                     |                              |                                                         |
| 1.                                       |                              | Fuel Oil Tanks, Piping, Pump House, and  Electrical Building |
| 2.                                       |                              | Ash Pond, Pipe Rack, and Pipe                                |
| 3.                                       |                              | Emergency Ash Pond                                           |
|                                     |                              |                                                         |
| SITE IMPROVEMENTS                        |
|                                     |                              |                                                         |
| 1.                                       | General Site Grating and Drainage |
| 2.                                       | Helicopter Pad                    |
| 3.                                       | Monitoring Wells                  |
| 4.                                       | Roadways                          |
| 5.                                       | Guard Facilities                  |
| 6.                                       | Underground Electrical Ducts      |
| 7.                                       | Sanitary Sewer Lines              |
| 8.                                       | Shoreline Protection              |
| 9.                                       | Fire Protection Lines             |
| 10.                                      | Potable Water Lines               |
| 11.                                      | Cathodic Protection               |

 

80

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APPENDIX D

KNOWN DEFECTS AT CLOSING

 

The attached list of known defects forTrimble County Unit I and the Trimble County General Plant Facilities as theypertain to Trimble County Unit 1 includes items for which construction is notcomplete as well as items where a deficiency is noted, and to the best of Louisville’sknowledge, information, and belief the attached list is current as of Closing.

 
|   | LOUISVILLE GAS AND ELECTRIC COMPANY |
|--------|-------------------------------------|
|   |                                |
|   | By:                                 |   |   |
|   |                                | Chris Hermann |
|   |                                | Vice President and General Manager |
|   |                                | Wholesale Electric Business |
|        |                                     |  |  |  |

 

81

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KNOWN DEFECTS AND OPEN WARRANTYCLAIMS AT CLOSING

 

Known design defects:

 

•                  Replace boilerpenthouse roof and sidewalls. Original roof was installed withnon-specification material.

 

Open warranty claims:

 

•                  Replace FGDmodule purge air and vent dampers. (ABB)

 

•                  Modify demisterwash lance seals. (ABB)

 

•                  Redesignprecipitator high voltage insulator compartment heater/blower system. (ABB)

 

•                  Replacegenerator field breaker. (GE)

 

•                  Replace boilerfeed pump turbine turning gears. (GE)

 

•                  Modify FGD pumpbay trolley system. (ABB)

 

•                  Modify induceddraft fan variable-frequency drive speed-control circuit. (Ross Hill)

 

•                  Backcharge forrepair work on induced draft fan motors (Buffalo Forge)

 

82

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APPENDIX E

DEED

 

THIS DEED is made and entered into this 1stday of February, 1993, by and between LOUISVILLE GAS AND ELECTRIC COMPANY, aKentucky corporation, of 220 West Main Street, P.O. Box 32010, Louisville,Kentucky 40232 (“Grantor”) and INDIANA MUNICIPAL POWER AGENCY, a body corporateand politic and a political subdivision of the State of Indiana, of 11610 NorthCollege Avenue, Carmel, Indiana 46032 (“Grantee”).

 

WITNESSETH:

 

That for and in consideration of the sum ofSeven Million Two Hundred Eight Thousand Seven Hundred and Fifty~Nine Dollars($7,208,759.00) and other good and valuable consideration, the receipt of whichis hereby acknowledged, Grantor has bargained and sold and does hereby grantand convey to Grantee in fee simple with covenant of GENERAL WARRANTY, thefollowing described property located in Trimble County, Kentucky, being a12.88~ undivided interest as tenants in common in the real property beneathTrimble County Unit 1 (“the Property”):

 

Being acertain parcel of land located to the north of Kentucky Highway 754 and to thewest of Kentucky Highway 1838, north of Wise’s Landing in Trimble County,Kentucky and being more particularly described as follows:

 

Beginning at a3 inch x 3 inch concrete monument in the northwest right-of-way line ofKentucky Highway 754 at its intersection with the west right-of-way of Wise’sLanding road; thence North 17° 30’ 19” West, 1925.28 feet to an iron pin beingthe True Point of Beginning Also known as plant grid coordinate N 32+50.00,E17+82.00; thence North 29° 02’ 25” West, 176.00 feet to a scribe mark inconcrete and being plant grid coordinate N 34+26.00, E 17÷82.00, said linebeing Column Line N; thence North 60° 57’ 35” East, 42.00 feet to a scribe markin concrete and being plant grid coordinate N34+26.00, E 18+24.00; thence North4° 38’ 59” West, 42.27 feet to plant grid coordinate N 34+62.00, E 18+48.00;thence North 60° 57’ 35” East, 759.17 feet to plant grid coordinate N 34÷62.00,E 26+07.17, said line being Column Line 9, common line between Unit No. 1 andUnit No. 2 (Future); thence South 29° 02’ 25” East, 55.25 feet to a R R spikebeing plant grid coordinate N 34÷06.75, E 26+07.17; thence South 60° 57’ 35”West, 57.17 feet to plant grid coordinate N 34+06.75, E 25+50.00; thence South29° 02’ 25” East, 156.75 feet to plant grid coordinate N 32÷50.00, E 25÷50.00,said line being Column Line A; thence South 60° 57’ 35” West, 768.00 feet tothe True Point of Beginning, said line being Column’s Line 17, common columnline between Unit No. 1 and the Service Building. Said tract containing 3.766acres. Being a part of the same conveyed to Grantor by deed of record in theoffice of the Trimble County Clerk in Deed Book No. 49, Page No. 602.

 

TO HAVE AND TO HOLD the Property, with allappurtenances and privileges thereunto belonging, unto the Grantee, itssuccessors and assigns.

 

83

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Grantor covenants that it is lawfully seizedof fee simple title to the Property and has full right and power to conveysame, subject to the rights of Illinois Municipal Electric Agency (“IMEA”)which owns a 12.12% undivided interest as tenants in common and subject to theParticipation Agreement dated February 28, 1991 by and between Grantor and IMEAand the Participation Agreement dated February 1, 1993, by and between Grantorand Grantee and incorporated by reference herein, memoranda of which are onfile in the Office of the Trimble County Clerk, which contain, among otherthings, certain restrictions on resale of the Property, the right Q~ firstrefusal upon transfer of the Property, the right of IMEA and Grantee toparticipate in the ownership of the next generating unit built at the TrimbleCounty Site, and waiver of the right of partition of the Property, and otherwisethe Property is free and clear of all encumbrances except those relating to theIMEA sale that are of record and all ad valorem taxes and assessments assessedagainst the Property for 1993 • and all subsequent years which Grantee assumesand agrees to pay.

 

IN TESTIMONY WHEREOF, witness the signatureof the Grantor as of the day, month and year first above-written.

 
|   | LOUISVILLE GAS AND ELECTRIC COMPANY |
|--------|-------------------------------------|
|   |                                |
|   | By:                                 |   |   |
|   |                                | Chris Hermann |
|   |                                | Vice President and General Manager |
|   |                                | Wholesale Electric Business |
|        |                                     |  |  |  |

 

84

----

 

CONSIDERATION CERTIFICATE

 

Grantor and Grantee hereby certify that theconsideration reflected in the foregoing Deed is the full consideration paidfor the Property.

 
|   | LOUISVILLE GAS AND ELECTRIC COMPANY |
|--------|-------------------------------------|
|   |                                |
|   | By:                                 |   |   |
|   |                                | Chris |
|   |                                | Vice President and General Manager, |
|   |                                | Wholesale Electric Business |
|   |                                |
|   |                                |
|   | INDIANA MUNICIPAL POWER AGENCY      |
|   |                                |
|   | By                                  |   |   |
|   |                                | Frank R. Rudolph, |
|   |                                | Chairman |
|        |                                     |  |  |  |  |  |

 

 
| COMMONWEALTH OF KENTUCKY | )    |
|--------------------------|------|
|                     | )(SS |
| COUNTY OF JEFFERSON      | )    |

 

The foregoing Deed and ConsiderationCertificate were signed, acknowledged and sworn to before me on this 29th dayof January, 1993, by Chris Hermann , Vice President and General Manager,Wholesale Electric Business of LOUISVILLE GAS AND ELECTRIC COMPANY, a Kentuckycorporation, on behalf of the corporation.

 
| My Commission expires: |                       |   |
|------------------------|----------------------------|--------|
|                   |                       |
|                   |                       |   |
|                   | Notary Public              |
|                   | State of Kentucky at Large |
|                        |                            |        |  |  |

 

85

----

 
| STATE OF INDIANA   | )   |
|--------------------|-----|
|               | )SS |
| COUNTY OF HAMILTON | )   |

 

The foregoing Consideration Certificate wassigned, acknowledged and sworn to before me on this 29th day of January , 1993, by Frank R. Rudolf, as Chairman of Indiana Municipal Power Agency, a bodycorporate and politic and a political subdivision of the State of Indiana, onbehalf of the corporation.

 
| My Commission expires: |             |   |
|------------------------|------------------|--------|
|                   |             |
|                   |             |   |
|                   | Notary Public    |
|                   | State of Indiana |
|                        |                  |        |  |  |

 

 
| (AFFIX SEAL]                      |
|-----------------------------------|
|                              |
| THIS INSTRUMENT PREPARED BY:      |
|                              |
|                              |   |
| C. Kent Hatfield                  |
| John M. Franck II                 |
| MIDDLETON & REUTLINGER        |
| 2500 Brown & Williamson Tower |
| Louisville, Kentucky 40202        |
| Telephone (502) 584-1135          |

 

86

----

 

APPENDIX F

 

EASEMENT

 

THIS EASEMENT dated the 1st day of February,1993, by and between LOUISVILLE GAS AND ELECTRIC COMPANY, a Kentuckycorporation located at 220 West Main Street, P.O. Box 32010, Louisville,Kentucky 40232, (the “Grantor”) , and INDIANA MUNICIPAL POWER AGENCY, a bodycorporate and politic and a political subdivision of the State of Indiana,located at 11610 North College Avenue, Carmel, Indiana 46032 (the “Grantee”).

 

FOR A VALUABLE CONSIDERATION, the receipt ofwhich is hereby acknowledged, Grantor does hereby grant and convey untoGrantee, its successors and assigns, a nonexclusive easement to use the TrimbleCounty Site to the extent necessary for use by Grantee with respect to itsproportional ownership of Trimble County Unit 1 as defined in the ParticipationAgreement by and between Grantor and Grantee dated February 1, 1993(“Participation Agreement”) . The Trimble County Site is located in TrimbleCounty, Kentucky (the “Burdened Property” ) , as shown on Exhibit “A” attachedhereto and made a part hereof. The Burdened Property was conveyed to Grantor byDeeds referenced on Exhibit “B” attached hereto and made a part hereof.

 

Grantor grants this easement upon the followingterms and conditions:

 

1.                                      ParticipationAgreement. Grantee will at all times abide by the terms of the ParticipationAgreement.

 

2.                                      Use by Grantee.The Burdened Property may be used by Grantee only for the purposes consistentwith the terms of the Participation Agreement.

 

3.                                      Use by Grantor.Grantor reserves the right to fully use and enjoy the Burdened Property as wellas to transfer or convey portions thereof for any use or purpose which does notunreasonably interfere with the exercise by Grantee of the rights granted bythe Participation Agreement. Should Grantee’s release of this Easement berequested as to such portions transferred or conveyed, such release shall notbe unreasonably withheld. Grantee acknowledges that this nonexclusive easement shallin no way restrict or prohibit Grantor from constructing additional generatingunits or facilities or expanding present units or facilities which shall alsohave a nonexclusive use of the Trimble County Site, to the extent necessary andas determined in Grantor’s sole discretion.

 

4.                                      Indemnification.Grantee will indemnify and hold Grantor harmless from and against any and alllosses, liabilities, costs, expenses, damages, claims, and causes of actionwhatsoever, including reasonable attorney’s fees, arising from this Easement.

 

5.                                      Binding Effect.This Easement shall be binding upon and inure to the benefit of Grantor andGrantee, and their respective successors and assigns, but shall not betransferable or assignable by Grantee except as permitted by and consistentwith the Participation Agreement.

 

6.                                      Termination. ThisEasement shall terminate (i) upon the mutual agreement of Grantor and Grantee,or (ii) if Trimble County Unit 1 ceases to be used or is abandoned, or (iii)

 

87

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upon the failure by Grantee to remedy anydefault in the performance of any term or condition of the ParticipationAgreement, or (iv) upon termination of the Participation Agreement .

 

7.                                      Release. Upontermination of this Easement, Grantee shall execute and deliver to Grantorwithin ten (10) days of written demand therefor, a good and sufficientquitclaim deed to all rights granted hereby. If Grantee fails or refuses todeliver such deed, written notice by Grantor reciting the failure or refusal ofGrantee and terminating this grant, shall after thirty (30) days from the dateof recording be conclusive evidence against Grantee and all persons claimingunder Grantee, of the termination of this Easement.

 

8.                                      Matters ofRecord. This Easement is subject to all easements, restrictions and othermatters of record.

 

IN WITNESS WHEREOF, the parties hereto haveexecuted this Easement on the date above set forth.

 
|   | GRANTOR                             |
|--------|-------------------------------------|
|   |                                |
|   | LOUISVILLE GAS AND ELECTRIC COMPANY |
|   |                                |
|   | By:                                 |   |   |
|   |                                | Chris |
|   |                                | Vice President and General Manager,  Wholesale Electric Business |
|   |                                |
|   | GRANTEE                             |
|   |                                |
|   | INDIANA MUNICIPAL POWER AGENCY      |
|   |                                |
|   | By                                  |   |   |
|   |                                | Frank R. Rudolph, |
|   |                                | Chairman |
|        |                                     |  |  |  |  |

 

88

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| COMMONWEALTH OF KENTUCKY | )    |
|--------------------------|------|
|                     | )(SS |
| COUNTY OF JEFFERSON      | )    |

 

The foregoing Deed and ConsiderationCertificate were signed, acknowledged and sworn to before me on this 29th dayof January, 1993, by Chris Hermann , Vice President and General Manager,Wholesale Electric Business of LOUISVILLE GAS AND ELECTRIC COMPANY, a Kentuckycorporation, on behalf of the corporation.

 
| My Commission expires: |                       |   |
|------------------------|----------------------------|--------|
|                   |                       |
|                   |                       |   |
|                   | Notary Public              |
|                   | State of Kentucky at Large |
|                        |                            |        |  |  |

 
| STATE OF INDIANA   | )   |
|--------------------|-----|
|               | )SS |
| COUNTY OF HAMILTON | )   |

 

The foregoing Consideration Certificate wassigned, acknowledged and sworn to before me on this 29th day of January , 1993, by Frank R. Rudolf, as Chairman of Indiana Municipal Power Agency, a bodycorporate and politic and a political subdivision of the State of Indiana, onbehalf of the corporation.

 
| My Commission expires: |             |   |
|------------------------|------------------|--------|
|                   |             |
|                   |             |   |
|                   | Notary Public    |
|                   | State of Indiana |
|                        |                  |        |  |  |

 

 
| (AFFIX SEAL]                      |
|-----------------------------------|
|                              |
| THIS INSTRUMENT PREPARED BY:      |
|                              |
|                              |   |
| C. Kent Hatfield                  |
| John M. Franck II                 |
| MIDDLETON & REUTLINGER        |
| 2500 Brown & Williamson Tower |
| Louisville, Kentucky 40202        |
| Telephone (502) 584-1135          |

 

89

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EXHIBIT A

 

Property Plat

 

90

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EXHIBIT B

 

The following list of references are thesources of title wherein Louisville Gas and Electric Company acquired propertieslocated in Trimble County as they pertain to the Trimble County Site. Deeds areof record in the Office of the Clerk of Trimble County, Kentucky.

 

1.                                       DB 49 Page 602Deed dated 4-30-1974 From Thomas Manby, Jr. Trustee. (Original Plant Site)

 

2.                                       DB 51 Page 769Deed Dated 4-16-1976 From Thomas Manby Jr. Trustee. (Part of Original PlantSite, located on North End of Site)

 

3.                                       DB 58 Page 321Deed Dated 11-29-1982 From Allison Schlegel Dickey & Dianna Dey Dickey.(Located on North End of Site)

 

4.                                       DB 65 Page 424Deed Dated 1-22~199O From Allison Schlegel Dickey & Dianna Dey Dickey.(Located on North End of Site)

 

5.                                       DB 63 Page 615Deed Dated 4-2O~-1988 From Charles G. Middleton III, Trustee. (Ravine Site)

 

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APPENDIX G

 

EASEMENT

 

THIS EASEMENT dated the 1st day of July, 19 93 , by and between INDIANA MUNICIPAL POWER AGENCY, a body corporate and politicand a political subdivision of the State of Indiana, with its offices locatedat 11610 North College Avenue, Carmel, Indiana 46032 (the “Grantor”) andLOUISVILLE GAS AND ELECTRIC COMPANY, a Kentucky corporation, located at 220West Main Street, P.O. Box 32010, Louisville, Kentucky 40232, (the “Grantee”)

 

FOR VALUABLE CONSIDERATION, the receipt ofwhich is hereby acknowledged, Grantor does hereby grant and convey untoGrantee, its successors and assigns, a nonexclusive easement to use any realproperty owned by Grantor on the Trimble County Site to the extent necessaryfor use by Grantee and other owners with respect to their proportionalownership of Trimble County Unit 1 as defined in the Participation Agreement byand between Grantor and Grantee dated February 1, 1993 (“ParticipationAgreement”) . The property owned by Grantor at the Trimble County Site is locatedin Trimble County, Kentucky as shown on Exhibit “A” attached hereto and made apart hereof (the “Burdened Property”) . A 12.88 percent undivided interest astenants in common of the Burdened Property was conveyed to Grantor by Deeddated February 1, 1993, of record in Deed Book      , Page      , in the Office of the Clerk of TrimbleCounty, Kentucky.

 

Grantor grants this easement upon thefollowing terms and conditions:

 

1.                                       ParticipationAgreement.  Grantee will at all timesabide by the terms of the Participation Agreement.

 

2 .                                    Use by Granteeand Grantor .  The Burdened Propertymay be used only for the purposes consistent with the terms of theParticipation Agreement.

 

3.                                       Indemnification.Grantee will indemnify and hold Grantor harmless from and against any and alllosses, liabilities, costs, expenses, damages, claims, and causes of actionwhatsoever, including reasonable attorney’s fees, arising from Grantee’s use ofthis Easement.

 

4.                                       BindingEffect. This Easement shall be binding upon and inure to the benefit ofGrantor and Grantee, and their respective successors and assigns, but shall notbe transferable or assignable by Grantee except as permitted by and consistentwith the Participation Agreement.

 

5.                                       Termination.This Easement shall terminate (i) upon the mutual agreement of Grantor andGrantee, or (ii) if Trimble County Unit 1 ceases to be used or is abandoned or(iii) upon the failure by Grantee to remedy any default in the performance ofany term or condition of the Participation Agreement, or (iv) upon terminationof the Participation Agreement.

 

6.                                       Release.Upon termination of this Easement, Grantee shall execute and deliver to Grantorwithin ten (10) days of written demand therefor, a good and sufficientquitclaim deed to all easement rights granted hereby. If Grantee fails orrefuses to deliver such deed, written notice by

 

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Grantor reciting the failure or refusal ofGrantee and terminating this grant, shall after thirty (30) days from the date- of recording be conclusive evidence against Grantee and all persons claimingunder Grantee of the termination of this Easement.

 

7.                                       Matters ofRecord. This Easement is subject to all easements, restrictions and othermatters of record.

 

IN WITNESS WHEREOF, the parties hereto haveexecuted this Easement on the date above set forth.

 
|   | GRANTOR                             |
|--------|-------------------------------------|
|   |                                |
|   | LOUISVILLE GAS AND ELECTRIC COMPANY |
|   |                                |
|   | By:                                 |   |   |
|   |                                | Chris |
|   |                                | Vice President and General Manager,  Wholesale Electric Business |
|   |                                |
|   | GRANTEE                             |
|   |                                |
|   | INDIANA MUNICIPAL POWER AGENCY      |
|   |                                |
|   | By                                  |   |   |
|   |                                | Frank R. Rudolph, |
|   |                                | Chairman |
|        |                                     |  |  |  |  |

 

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| COMMONWEALTH OF KENTUCKY | )    |
|--------------------------|------|
|                     | )(SS |
| COUNTY OF JEFFERSON      | )    |

 

The foregoing Deed and ConsiderationCertificate were signed, acknowledged and sworn to before me on this 29th dayof January, 1993, by Chris Hermann , Vice President and General Manager,Wholesale Electric Business of LOUISVILLE GAS AND ELECTRIC COMPANY, a Kentuckycorporation, on behalf of the corporation.

 
| My Commission expires: |                       |   |
|------------------------|----------------------------|--------|
|                   |                       |
|                   |                       |   |
|                   | Notary Public              |
|                   | State of Kentucky at Large |
|                        |                            |        |  |  |

 
| STATE OF INDIANA   | )   |
|--------------------|-----|
|               | )SS |
| COUNTY OF HAMILTON | )   |

 

The foregoing Consideration Certificate wassigned, acknowledged and sworn to before me on this 29th day of January , 1993, by Frank R. Rudolf, as Chairman of Indiana Municipal Power Agency, a bodycorporate and politic and a political subdivision of the State of Indiana, onbehalf of the corporation.

 
| My Commission expires: |             |   |
|------------------------|------------------|--------|
|                   |             |
|                   |             |   |
|                   | Notary Public    |
|                   | State of Indiana |
|                        |                  |        |  |  |

 
| (AFFIX SEAL]                      |
|-----------------------------------|
|                              |
| THIS INSTRUMENT PREPARED BY:      |
|                              |
|                              |   |
| C. Kent Hatfield                  |
| John M. Franck II                 |
| MIDDLETON & REUTLINGER        |
| 2500 Brown & Williamson Tower |
| Louisville, Kentucky 40202        |
| Telephone (502) 584-1135          |

 

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EXHIBIT A

 

Being a certain parcel of land located to thenorth of Kentucky Highway 754 and to the west of Kentucky Highway 1838, northof Wise’s Landing in Trimble County, Kentucky and being more particularlydescribed as follows:

 

Beginning at a 3 inch x 3 inch concretemonument in the northwest right-of-way line of Kentucky Highway 754 at itsintersection with the west right- of -way of Wise “ s Landing road; thenceNorth 17° 30’ 19” West, 1925.28 feet to an iron pin being the True Point of Beginning.  Also known as plant grid coordinate N32+50.00, El7+82.00; thence North 29° 02’ 25” West, 176.00 feet to a scribemark in concrete and being plant grid coordinate N 34+26.00, E 17+82.00, saidline being Column Line N; thence North 60° 57’ 35” East, 42.00 feet to a scribemark in concrete and being plant grid coordinate N34+26.00, E 18+24.00; thenceNorth 4° 38’ 59” West, 42.27 feet to plant grid coordinate N 34+62.00, E18+48.00; thence North 60° 57’ 35” East, 759.17 feet to plant grid coordinate N34+62.00, E 26+07.17, said line being Column Line 9, common line between UnitNo. 1 and Unit No. 2 (Future); thence South 29° 02’ 25” East, 55.25 feet to a RR spike being plant grid coordinate N 34+06.75, E 26+07.17; thence South 60°57’ 35” West, 57.17 feet to plant grid coordinate N 34+06.75, E 25+50.00; thenceSouth 29° 02’ 25” East, 156.75 feet to plant grid coordinate N 32+50.00, E25+50.00, said line being Column Line A; thence South 60° 57’ 35” West, 768.00feet to the True Point of Beginning, said line being Column Line 17, commoncolumn line between Unit No. 1 and the Service Building. Said tract containing3.766 acres. Being a part of the same conveyed to Grantor by deed of record inthe office of the Trimble County Clerk in Deed Book No.      , Page No.      .

 

95

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