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Home My WebLink AboutMINUTES - 03132012 - C.83RECOMMENDATION(S): APPROVE Acknowledgment of Collateral Assignment between County, MFP CO II, LLC, MS Solar Solutions Corp., and U.S Bank National Association for financing of solar photovoltaic system at eight County sites; and AUTHORIZE Public Works Director or designee to execute document. FISCAL IMPACT: None. The solar photovoltaic system is being installed at no cost to the County, and there is no cost associated with the document. BACKGROUND: On September 28, 2010, the County approved two Power Purchase Agreements (PPAs) with Main Street Power, Inc. The PPAs provided for the installation by Main Street Power of a solar photovoltaic system for electric power generation at twelve sites owned by the County and the purchase by the County of the generated electricity. To date, Main Street Power has completed installation of the photovoltaic system at eleven of the twelve sites. The installation work at those eleven sites has been inspected and APPROVE OTHER RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE Action of Board On: 03/13/2012 APPROVED AS RECOMMENDED OTHER Clerks Notes: VOTE OF SUPERVISORS AYE:John Gioia, District I Supervisor Gayle B. Uilkema, District II Supervisor Mary N. Piepho, District III Supervisor Karen Mitchoff, District IV Supervisor ABSENT:Federal D. Glover, District V Supervisor Contact: Julie Bueren, 313-2201 I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown. ATTESTED: March 13, 2012 David Twa, County Administrator and Clerk of the Board of Supervisors By: June McHuen, Deputy cc: C.83 To:Board of Supervisors From:Julia R. Bueren, Public Works Director/Chief Engineer Date:March 13, 2012 Contra Costa County Subject:Approve and Authorize Power Purchase Agreement BACKGROUND: (CONT'D) verified by County staff (Public Works/General Services). The installation work at the final site—West County Justice Center—is currently on hold while additional environmental review and re-design work is completed. Under the PPAs, Main Street Power is permitted to assign its interest and obligations under the agreements to a Credit-Worthy Affiliate (i.e., that has assets, creditworthiness, and experience comparable to Main Street Power). In January 2012, Main Street Power notified the County that it had assigned its interest and obligations for the following eight Non-New Market Tax Credit sites to MFP CO II, LLC: (1) Summit Center, 2530 Arnold Drive, Martinez (2) Byron Boys Ranch, 4491 Bixler Road, Byron (3) Delta Fair Boulevard, 4549 Delta Fair Boulevard, Antioch (4) Marsh Creek Detention Facility, 12000 Marsh Creek Road, Clayton (5) County Main Library, 1756 Oak Park Boulevard, Pleasant Hill (6) Martinez Animal Shelter, 4800 Imhoff Place, Martinez (7) Public Works Maintenance, 2475 Waterbird Way, Martinez (8) Facilities Maintenance, 2467 Waterbird Way, Martinez According to the notices sent by Main Street Power, the assignee (MFP CO II, LLC) is a Credit-Worthy Qualified Assignee, as defined in the PPAs. Under the PPAs, at the request of Main Street Power’s Lender or Qualified Assignee, the County agrees to execute and deliver any document, instrument, or statement required by law or reasonably requested by the Lender in order to create, perfect, continue, or terminate the Lender’s Security Interest in the photovoltaic system and/or the PPAs. The above assignee (MFP CO II, LLC) and Main Street Power’s lender (MS Solar Solutions Corp.) have requested that the County sign and deliver the attached Acknowledgment of Collateral Assignment document. Public Works staff recommends that the Board approve the attached document and authorize its signature by the Public Works Director or designee. CONSEQUENCE OF NEGATIVE ACTION: This is a requirement of the Power Purchase Agreement with Main Street Power. CHILDREN'S IMPACT STATEMENT: Not applicable. ATTACHMENTS Acknowledgement of Collateral Assignment 1 of 7 ACKNOWLEDGMENT OF COLLATERAL ASSIGNMENT This Acknowledgement of Collateral Assignment (“Acknowledgment”), which is effective on March , 2012, is made by and between CONTRA COSTA COUNTY (“County”), MFP CO II, LLC, as assignee of MAIN STREET POWER COMPANY, INC. (“Seller”), MS SOLAR SOLUTIONS CORP. (“Lender”), and U.S. BANK NATIONAL ASSOCIATION, as collateral agent for Lender (“Collateral Agent”), under that certain CONTRA COSTA COUNTY POWER PURCHASE AGREEMENT [NON-NEW MARKET TAX CREDIT PROJECT SITES] dated October 1, 2010 (“PPA”), as amended and properly assigned from time to time. This Acknowledgement is provided to Seller and Lender, which is providing financial accommodations to Seller, pursuant to Section 11.2 of the PPA. The solar photovoltaic system (the “PV System”) to be installed, operated and maintained by Seller pursuant to the PPA is located at County’s facilities set forth on attached Exhibit A (collectively, the “Premises”). 1. Acknowledgement of Collateral Assignment. (a) County acknowledges the collateral assignment by Seller to Lender of Seller’s interest in the PPA and Seller’s right, title, and interest in the PV System, as described in Section 11.2 of the PPA. (b) As provided in Section 11.2(c) of the PPA, Lender, as such collateral assignee, shall be entitled to exercise any and all rights of lenders generally with respect to Seller’s interest in the PPA, including those rights provided to Lender in the PPA. (c) County acknowledges that it has been advised that Seller has granted to Lender a first priority Security Interest in the PV System and that Lender has relied upon the characterization of the PV System as personal property, as provided in Section 11.2(d) of the PPA, in accepting such Security Interest as collateral for its financial accommodations to Seller. (d) County shall pay all amounts (if any) payable by it under the PPA in the manner and as and when required by the PPA into the following account designated by Seller and shall not accept any change in payment directions unless such change has been consented to in writing by Collateral Agent or is mandated by court order: U.S. Bank Operations Center Attn: Trust Finance Management Lockbox Services-CM9705 P.O. Box 70870 St. Paul, MN 55170-9705 Account No. 146438010 MFP CO II, LLC 2 of 7 (e) As provided in Section 11.2(e) of the PPA, County shall provide a duplicate copy of any material notices (including, without limitation, default notices, but not including routine correspondence in the normal course of business) to Lender at the following address: MS Solar Solutions Corp. 2000 Westchester Avenue Purchase, New York 10577 Attention: Mrs. Deborah L. Hart Email: deborah.hart@morganstanley.com Facsimile: 212-507-8843 2. Confirmation. County confirms the following matters for the benefit of Lender: (a) With respect to the Premises listed in Exhibit A, to County’s knowledge, there presently exists no event or condition that constitutes a default or that would, with the giving of notice or lapse of time, constitute an Event of Default under the PPA. (b) County has inspected and verified completion of the PV System as installed at the Premises listed in Exhibit A. (c) With respect to the Premises listed in Exhibit A, County is aware of no existing lease, mortgage, security interest, or other interest in or lien upon any portion of the Premises that could attach to any or all of the PV System as an interest adverse to Lender’s Security Interest therein, except for personal property taxes, if any, that may apply to the PV System. [Four Signature Pages Follow This Page.] [Signature Page to Acknowledgment of Collateral Assignment] 3 of 7 CONTRA COSTA COUNTY, a political subdivision of the State of California (COUNTY) By: Name: Julia R. Bueren Title: Public Works Director [Signature Page to Acknowledgment of Collateral Assignment] 4 of 7 MFP CO II, LLC, a Colorado limited liability company, as assignee of Main Street Power Company, Inc. (SELLER) By: Name: T. Amory Host Title: President [Signature Page to Acknowledgment of Collateral Assignment] 5 of 7 MS SOLAR SOLUTIONS CORP., a [insert state name] corporation (LENDER) By: Name: Title: [Signature Page to Acknowledgment of Collateral Assignment] 6 of 7 U.S. BANK NATIONAL ASSOCIATION, an Ohio corporation, as collateral agent for Lender (COLLATERAL AGENT) By: Name: Leland Hansen Title: Vice President 7 of 7 EXHIBIT A LIST OF SITES Summit Center 2530 Arnold Drive, Martinez, CA 94553 Byron Boys Ranch 4491 Bixler Road, Byron, CA 94514 Delta Fair Boulevard 4549 Delta Fair Boulevard, Antioch, CA 94509 Marsh Creek Detention Facility 12000 Marsh Creek Road, Clayton, CA 94517 County Main Library 1756 Oak Park Boulevard, Pleasant Hill, CA 94523 Martinez Animal Shelter 4800 Imhoff Place, Martinez, CA 94553 Public Works Maintenance 2475 Waterbird Way, Martinez, CA 94553 Facilities Maintenance 2467 Waterbird Way, Martinez, CA 94553 NOTE: Upon completion of the portion of the PV System located at the West County Detention Center, which sites are not included in the Premises covered by this Acknowledgment, a separate Acknowledgment of Collateral Assignment will be executed by the parties.