Basin Electric Power Cooperative - Page 26

                                       - 26 -                                         
          under the 1984 bond indenture to require Mercer County to redeem            
          those bonds, petitioner did not have the right under the 1985               
          sale and leaseback to request that the owner participant exercise           
          its right.                                                                  
               Petitioner developed a strategy to overcome the foregoing              
          hurdles.  That strategy included petitioner’s offering certain              
          inducements to each owner participant and Mercer County in order            
          to persuade them to agree to the modification of the 1985 sale              
          and leaseback and the concomitant refinancing of the 1984 tax-              
          exempt bonds.  Thus, petitioner offered (1) to exercise its                 
          option under the 1985 sale and leaseback to elect to extend for             
          five years the term of the lease and (2) to pay the costs associ-           
          ated with modifying the 1985 sale and leaseback and effecting the           
          concomitant refinancing of the 1984 tax-exempt bonds.                       
               Petitioner’s strategy to overcome the hurdles that it faced            
          in achieving its objective of modifying the 1985 sale and                   
          leaseback was successful, and petitioner, the owner participants,           
          and Mercer County agreed to take the steps necessary to modify              
          and enhance the 1985 sale and leaseback, which included the                 
          concomitant refinancing of the 1984 tax-exempt bonds, in order to           
          achieve a substantial rent reduction for petitioner.  Specifi-              
          cally, they agreed to the 1992 amendments to the 1985 sale and              
          leaseback agreements and to the concomitant transactions neces-             
          sary to achieve that objective.                                             






Page:  Previous  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  Next

Last modified: May 25, 2011