AES » Topics » Disengagement

This excerpt taken from the AES 10-K filed Mar 17, 2008.

Disengagement

 

8.12         Promptly following the Termination Date, the Manager shall hand or deliver to, or relinquish custody in favour of, the Owners or, if applicable, a Successor Manager all amounts to the credit of any bank account managed by the Manager in the name of or as agent or trustee for the Owners in relation to its role as Manager and all books, records and inventories and all property held as agent or trustee for the Owners relating to the commercial, administrative, operation, maintenance and capital expenditure activities of the Facilities. The Manager shall use reasonable endeavours to transfer to the Owners or, if applicable, a Successor Manager, effective as of the Termination Date, any rights it may have as Manager under the Service Contracts.

 

8.13         If the Owners or the Parent enter into an agreement with a Successor Manager for provision of Services equivalent to the Services following termination of this Agreement, the Manager shall (without prejudice to its rights hereunder) during the last six months of the Term (or any shorter period following execution of such agreement with the Successor Manager), provide reasonable access for such Successor Manager and its representatives to the Facilities and (subject to the Manager’s rights under clause 3.6 and subject to the Successor Manager executing and complying with the terms of a confidentiality agreement in such form as the Manager reasonably requires) documents and information in the Manager’s possession relating to the Facilities.

 

8.14         The Manager shall, at least 12 months prior to the expiry of the Term, prepare and submit to the Parent and the Owners a Transition Plan.  The Transition Plan shall cover the six months prior to the expiry of the Term and shall be taken account of in the preparation of the Annual Budget for the Operating Year ending 31 December 2010.  The Transition Plan shall provide for the management of the transfer of the commercial, administrative, operation, maintenance and capital expenditure activities of the Facilities from the Manager to a Successor Manager or to the Owners and the migration from that Termination Date of the commercial, administrative, operation, maintenance and capital expenditure activities of the Facilities from the Manager Proprietary Systems to replacement systems and procedures designated by the Parent and the Owners

 

8.15         In accordance with the Transition Plan, the Parent, the Owners and the Manager shall co-operate within the period prescribed in the Transition Plan prior to the Termination Date (if such date occurs at the expiry of the Term) to complete the Transition Plan.

 

 

 

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8.16         In the event of early termination of this Agreement by the Manager or the Parent, the Manager shall if required by the Owners continue to operate the Power Station for a period specified by the Owners but not exceeding 90 days whilst the Successor Manager is installed, including taking the actions contemplated in clause 8.13 for the Successor Manager to understand management of the Owners. During any such period the Manager shall continue to act in all respects in accordance with this Agreement as if the same had not been terminated and the Manager’s obligations hereunder continued during such period. The Owners shall afford the Manager every assistance in redeploying staff or making use of temporary staff to carry out its obligations.

 

8.17         All costs and expenses of any of the Parties associated with the transfer of the Services and the Manager’s obligations under the Agreement and the Service Contracts to the Owners or, if applicable, a Successor Manager before or after the Termination Date, shall be for the account of the Parent and the Owners and the Parent and the Owners shall reimburse such costs to the Manager on demand, including after the Termination Date.  Any costs and expenses of the Manager associated with the transfer of the Services and the Manager’s obligations under the Agreement and the Service Contracts to the Owners or, if applicable, a Successor Manager before the Termination Date shall be excluded from (or be included as an increase in) the calculation of EBITDA and the Earnout Income Statements under the Sale and Purchase Agreement for the relevant Earnout Period.

 

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