<PAGE>
Exhibit 10.27
================================================================================
ESCROW AGREEMENT
among
VIRGINIA ELECTRIC AND POWER COMPANY,
("Virginia Power")
LSP ENERGY LIMITED PARTNERSHIP,
("Partnership")
AND
THE CHASE MANHATTAN BANK,
("Escrow Agent")
DATED AS OF AUGUST 17, 2000
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I. ESCROW ACCOUNT......................................................2
Section 1.1 Initial Deposit of Escrow Amount.............................2
Section 1.2 Investment of Escrow Amount..................................2
Section 1.3 Release of Escrow Amount.....................................3
Section 1.4 Payment of Amounts in Reimbursement of Improper Draws........3
Section 1.5 Interest on LOC Loans........................................3
ARTICLE II. ESCROW AGENT.......................................................4
Section 2.1 Duties.......................................................4
Section 2.2 Duties Uncertain.............................................4
Section 2.3 Liability....................................................5
Section 2.4 Legal Counsel................................................5
Section 2.5 Dispute......................................................5
Section 2.6 Indemnification..............................................5
Section 2.7 Survival.....................................................6
Section 2.8 Resignation..................................................6
Section 2.9 Expenses.....................................................6
ARTICLE III. MISCELLANEOUS.....................................................6
Section 3.1 Notices......................................................6
Section 3.2 Termination..................................................8
Section 3.3 Governing Law................................................8
Section 3.4 Consent to Jurisdiction......................................8
Section 3.5 Waiver of Jury Trial.........................................8
Section 3.6 Reliance.....................................................9
Section 3.7 Entire Agreement; Waivers....................................9
Section 3.8 Amendment or Modification, etc...............................9
Section 3.9 Headings, etc................................................9
Section 3.10 Severability.................................................9
Section 3.11 Counterparts................................................10
Section 3.12 Successors and Assigns......................................10
<PAGE>
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the "Agreement") is made and entered into as of
August 17, 2000, by and among Virginia Electric and Power Company ("Virginia
Power"), a Virginia public service corporation, LSP Energy Limited Partnership,
a Delaware limited partnership (the "Partnership"), and Chase Manhattan Bank, a
New York State chartered bank, in its capacity as escrow agent (the "Escrow
Agent").
RECITALS
A. Virginia Power and the Partnership have entered into that certain Power
Purchase Agreement dated May 18, 1998 (as the same has been amended, modified
and supplemented from time to time, the "Power Purchase Agreement").
B. As required by the Power Purchase Agreement, the Partnership caused
Credit Suisse First Boston (in such capacity, the "LOC Issuer") to issue two
letters of credit (collectively, the "Letters of Credit") to and for the benefit
of Virginia Power in an aggregate stated amount of $11,320,000. The Letters of
Credit bear Reference Numbers 75-07001497 and 75-06001015 and, in general, were
intended to secure, among other things, the Partnership's obligation to
reimburse Virginia Power for Incremental Replacement Power Costs (as defined in
the Power Purchase Agreement) in the event of the Partnership's failure to
achieve the Commercial Operation Date (as defined in the Power Purchase
Agreement) by a specified date (which date was to be subject to adjustment under
certain circumstances).
C. On July 21, 2000, Virginia Power, believing itself to be entitled to do
so under the Power Purchase Agreement, drew $4,649,743.47 under each Letter of
Credit for an aggregate amount of $9,299,486.94. The Partnership's reimbursement
obligation with respect to such Letters of Credit converted into a five year
amortizing loan ("LOC Loans") provided by the LOC Issuer.
D. The Partnership believes that the method and amount of such drawings on
the Letters of Credit violated the terms and conditions of the Power Purchase
Agreement. Virginia Power believes that the method and amount of such drawings
on the Letter of Credit complied with the terms and conditions of the Power
Purchase Agreement.
E. In order to resolve their dispute concerning the method and amount of
such drawings pending resolution of such dispute, Virginia Power and the
Partnership have agreed to enter into this Escrow Agreement whereunder, among
other things, Virginia Power will deliver to the Escrow Agent cash in the amount
of $9,299,486.94 (as the same may be increased or decreased from time to time
due to investment earnings or losses as provided herein, the "Escrow Amount") to
be maintained and disbursed by the Escrow Agent as further provided herein.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements herein contained and for other good valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, agree as follows:
<PAGE>
ARTICLE I.
ESCROW ACCOUNT
Section 1.1 Initial Deposit of Escrow Amount.
On the date hereof, concurrently with the execution and delivery of this
Agreement, Virginia Power shall deliver, in cash, to the Escrow Agent, an amount
equal to the Escrow Amount, for deposit by the Escrow Agent in an account (the
"Escrow Account") to be maintained by and in the name of the Escrow Agent,
having Account No. 910-2-758829, ABA Routing No. 021000021 and being referred to
as the "Virginia Power and LSP Energy Escrow Account". The Escrow Agent shall
maintain the Escrow Account, and all amounts on deposit therein or credited
thereto, only as provided herein and shall have no other rights or obligations
with respect to the Escrow Account.
Section 1.2 Investment of Escrow Amount.
(a) During the term of this Agreement, the Escrow Agent shall invest
the Escrow Amount, at the direction of the Partnership, in (i) securities issued
or directly and fully guaranteed or insured by the United States of America or
any agency or instrumentality thereof (provided that the full faith and credit
of the United States of America is pledged in support thereof); (ii) time
deposits and certificates of deposit of any domestic commercial bank of
recognized standing having capital and surplus in excess of $100,000,000; (iii)
commercial paper issued by the parent corporation of any domestic commercial
bank of recognized standing having capital and surplus in excess of $100,000,000
and commercial paper of any domestic corporation rated at least A-1 or the
equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody's;
(iv) Chase Trust Deposit Account, which account the Escrow Amount is to be
invested unless otherwise instructed in writing by the Partnership, and (iv)
money market funds having a rating in the highest investment category granted
thereby by a rating agency at the time of acquisition, including any fund for
which the Escrow Agent or an affiliate of the Escrow Agent serves as an
investment advisor, administrator, shareholder, servicing agent, custodian or
subcustodian, notwithstanding that (a) Escrow Agent or an affiliate of the
Escrow Agent charges and collects fees and expenses from such funds for services
rendered (provided that such charges, fees and expenses are on terms consistent
with terms negotiated at arm's length) and (b) the Escrow Agent charges and
collects fees and expenses for services rendered pursuant to this Escrow
Agreement, unless otherwise jointly instructed in writing by the Partnership and
Virginia Power. Each of the securities described in clauses (i), (ii) and (iii)
above shall have maturities not to exceed thirty (30) days.
(b) Interest and other earnings derived from the investments made in
accordance with Section 1.2.(a) hereof shall be added to the Escrow Amount and
shall become a part thereof subject to the terms hereof. The allocation of any
such interest and earnings to the Partnership and/or Virginia Power pursuant to
a Judgement or the Instructions, as applicable, shall be in lieu of any default
interest owed to the other party as a result of the dispute described herein,
whether at law or pursuant to the Power Purchase Agreement, for the period from
the date of the draw on the Letters of Credit and until the date of the
termination of the Agreement.
2
<PAGE>
(c) At least on a monthly basis, the Escrow Agent shall provide the
Partnership and Virginia Power with a statement regarding the following: (i) the
Escrow Amount at such time, and (ii) all interest accrued and any other earnings
added to the Escrow Amount since the previous statement issued pursuant to this
Section 1.2(c). In addition, the Escrow Agent shall provide to the Partnership
and Virginia Power with any other customary information as they may reasonably
request.
Section 1.3 Release of Escrow Amount.
The Escrow Agent shall hold the Escrow Amount in escrow pursuant to this
Agreement until such time as any one of the following shall have occurred:
(a) the Escrow Agent shall have received a copy of a judgement
issued by a court of competent jurisdiction (the "Judgment") stating (i) to whom
the Escrow Amount is to be delivered in whole or in part, (ii) the manner and
all pertinent instructions pursuant to which the Escrow Amount is to be
delivered and (iii) when the Escrow Amount is to be delivered. Upon receipt of
such Judgment, the Escrow Agent shall deliver the Escrow Amount as directed in
the Judgment; or
(b) the Escrow Agent shall have received written instructions
executed by both the Partnership and Virginia Power (the "Instructions") stating
(i) to whom the Escrow Amount is to be delivered in whole or in part, (ii) the
manner and all pertinent instructions pursuant to which the Escrow Amount is to
be delivered and (iii) when the Escrow Amount is to be delivered. Upon receipt
of a writing that the Escrow Agent reasonably believes to constitute such
Instructions, the Escrow Agent shall deliver the Escrow Amount as directed by
the Instructions.
Section 1.4 Payment of Amounts in Reimbursement of Improper Draws.
Notwithstanding anything herein to the contrary, in the event any Judgment
or Instruction directs that all or part of the Escrow Amount is to be disbursed
to or for the benefit of the Partnership, the Escrow Agent shall disburse such
amount directly to the LOC Issuer in reimbursement of amounts drawn on the
Letters of Credit, unless either (i) to disburse the funds as such would violate
the terms of any such Judgment in the reasonable judgment of the Escrow Agent or
(ii) the Escrow Agent shall have received written notice from the Partnership
certifying that no amounts remain unreimbursed by the Partnership to the LOC
Issuer in respect of the Letters of Credit.
Section 1.5 Interest on LOC Loans.
(a) Subject to Section 1.5(b) below, on or before the fifth (5th)
day of each Month beginning in September 2000 and until termination of this
Agreement in accordance with its terms, the Partnership shall submit an invoice
to Virginia Power which sets forth one-half of the Partnership's interest
obligation with respect to the LOC Loans for such Month (the
3
<PAGE>
"Monthly Interest Amount"). On or before the twentieth (20th) Day of such Month,
Virginia Power shall remit to the Partnership's Revenue Account # 220776 the
Monthly Interest Amount.
(b) On or before August 31, 2000, Virginia Power shall remit to the
Partnership's Revenue Account # 220776 $88,059.28, which amount represents the
Partnership's interest obligation with respect to the LOC Loans from the date of
the Virginia Power draw until and including August 31, 2000.
(c) Upon the termination of this Agreement, Virginia Power and the
Partnership shall allocate between themselves responsibility for the
Partnership's interest obligation with respect to the LOC Loans for the period
September 2000 through termination of this Agreement (the "LOC Interest Period")
in the same proportion as the Escrow Amount is distributed to the parties
pursuant to Section 1.3 of this Agreement (the "LOC Interest Allocation").
Virginia Power and the Partnership shall then reconcile the LOC Interest
Allocation with the interest payments actually made by the parties on account of
the LOC Loans during the LOC Interest Period and determine the amount, if any,
owed by one party to the other in order to make the interest actually paid by
each of Virginia Power and the Partnership equivalent to the amount owed by such
party under the LOC Interest Allocation. The amount so owed shall then be paid
by the party owing said amount to the other party. The LOC Interest Allocation,
the reconciliation and payment described in this subsection shall be completed
as soon as practicable following the termination of this Agreement and in all
events no later than thirty (30) calendar days following the termination of this
Agreement. All payments owed to the Partnership pursuant to this subsection
shall be made to the Partnership's Revenue Account # 220776.
(d) The Escrow Agent shall have no duties, responsibilities or
obligations of any nature whatsoever with respect to the provisions of this
Section 1.5.
ARTICLE II.
ESCROW AGENT
Section 2.1 Duties.
The Escrow Agent shall have no duties or responsibilities, including,
without limitation, a duty to review or interpret the Power Purchase Agreement,
except those expressly set forth herein. Except for this Agreement, the Escrow
Agent, in its capacity as such, is not a party to, or bound by, any agreements
that may be required under, evidenced by, or arise out of the Power Purchase
Agreement.
Section 2.2 Duties Uncertain.
If the Escrow Agent shall be uncertain as to its duties or rights
hereunder or shall receive instructions from any of the undersigned with respect
to the Escrow Amount, which, in its opinion, are in conflict with any of the
provisions of this Agreement, it shall be entitled to refrain from taking any
action until it shall be directed otherwise in writing by the Partnership or
Virginia Power or by order of a court of competent jurisdiction. The Escrow
Agent shall be
4
<PAGE>
protected in acting upon any notice, request, waiver, consent, receipt or other
document reasonably believed by the Escrow Agent to be signed by the proper
party or parties.
Section 2.3 Liability.
The Escrow Agent shall not be liable for any error or judgment or for any
act done or step taken or omitted by it in good faith or for any mistake of fact
or law, or for anything that it may do or refrain from doing in connection
herewith, except for its own gross negligence or willful misconduct, and the
Escrow Agent shall have no duties to anyone except the Partnership and Virginia
Power and their respective successors and permitted assigns.
Section 2.4 Legal Counsel.
The Escrow Agent may consult legal counsel in the event of any dispute or
question as to the construction of this Agreement, or the Escrow Agent's duties
hereunder, and the Escrow Agent shall incur no liability and shall be fully
protected with respect to any action taken or omitted in good faith in
accordance with the opinion and instructions of counsel.
Section 2.5 Dispute.
In the event of any disagreement between the undersigned or any of them,
and/or any other person, resulting in adverse claims and demands being made in
connection with or for the Escrow Amount, the Escrow Agent shall be entitled at
its option to refuse to comply with any such claim or demand, so long as such
disagreement shall continue, and in so doing the Escrow Agent shall not be or
become liable for damages or interest to the undersigned or any of them or to
any person named herein for its failure or refusal to comply with such
conflicting or adverse demands. The Escrow Agent shall be entitled to continue
so to refrain and refuse so to act until all differences shall have been
resolved by agreement and the Escrow Agent shall have been notified thereof in
writing signed by the Partnership and Virginia Power. In the event of such
disagreement which continues for 90 days or more, the Escrow Agent in its
discretion may, but shall be under no obligation to, file a suit in interpleader
for the purpose of having the respective rights of the claimants adjudicated and
may deposit with the court all documents and property held hereunder. Each of
the Partnership and Virginia Power agree to each pay 50% of all reasonable
out-of-pocket costs and expenses incurred by the Escrow Agent in such action,
including reasonable attorney's fees and disbursements.
Section 2.6 Indemnification.
The Escrow Agent is hereby indemnified by the Partnership and Virginia
Power from all losses, costs and expenses of any nature incurred by the Escrow
Agent arising out of or in connection with this Agreement or with the
administration of its duties hereunder, unless such losses, costs or expenses
shall have been caused by the Escrow Agent's willful misconduct or gross
negligence. Such indemnification shall survive termination of this Agreement
until extinguished by any applicable statute of limitations. In the event that
either the Partnership or Virginia Power fully indemnifies the Escrow Agent,
such indemnifying party shall have the right to recover from the
non-indemnifying party 50% of the full amount paid to the Escrow Agent as
indemnification. Anything in this agreement to the contrary notwithstanding, in
no event shall
5
<PAGE>
the Escrow Agent be liable for special, indirect or consequential loss or damage
of any kind whatsoever (including but not limited to loss profits), even if the
Escrow Agent has been advised of the likelihood of such loss or damage and
regardless of the form of the action.
Section 2.7 Survival.
The Escrow Agent, in its capacity as Escrow Agent, does not have any
interest in the Escrow Amount deposited hereunder but is serving as escrow
holder only and having only possession thereof. This paragraph shall survive
notwithstanding any termination of this Agreement or the resignation of the
Escrow Agent.
Section 2.8 Resignation.
The Escrow Agent (and any successor Escrow Agent) may at any time resign
as such by giving written notice of its resignation to the parties hereto at
least 30 days prior to the date specified for such resignation to take effect.
Upon the effective date of such resignation, the Escrow Amount shall be
delivered by it to such successor Escrow Agent or as otherwise shall be
instructed in writing by the Partnership and Virginia Power, whereupon the
Escrow Agent shall be discharged of and from any and all further obligations
arising in connection with this Agreement. If at that time the Escrow Agent has
not received such instruction, the Escrow Agent's sole responsibility after that
time shall be to safekeep the Escrow Amount until receipt of a designation of
successor Escrow Agent or joint written instruction as to disposition of the
Escrow Amount by the Partnership and Virginia Power or a final order of a court
of competent jurisdiction mandating disposition of the Escrow Amount.
Section 2.9 Expenses.
The Escrow Agent hereby accepts its appointment and agrees to act as
escrow agent under the terms and conditions of this Agreement and acknowledges
receipt of the Escrow Amount. Each of the Partnership and Virginia Power further
agree to jointly and severally reimburse the Escrow Agent for 50% of all
reasonable out-of-pocket expenses, disbursements and advances incurred or made
by the Escrow Agent in the performance of its duties hereunder (including
reasonable fees, and out-of-pocket expenses and disbursements, of its counsel).
The Escrow's Agent's fees are set forth on Schedule I attached hereto.
ARTICLE III.
MISCELLANEOUS
Section 3.1 Notices.
Any notices or other communications required or permitted hereunder shall
be effective if in writing and delivered personally or sent by overnight
courier, addressed as follows:
If to the Partnership, at:
LSP ENERGY LIMITED PARTNERSHIP
c/o LS Power Management, LLC
6
<PAGE>
Two Tower Center, 20th Floor
East Brunswick, NJ 08816
Attention: Treasurer
Telephone: (732) 249-6750
Facsimile: (732) 249-7290
And
LSP ENERGY LIMITED PARTNERSHIP
c/o LS Power Management, LLC
Two Tower Center, 20th Floor
East Brunswick, NJ 08816
Attention: General Counsel
Telephone: (732) 249-6750
Facsimile: (732) 249-7290
If to Virginia Power, at:
VIRGINIA ELECTRIC AND POWER COMPANY
5000 Dominion Boulevard
Glen Allen, VA 23060
Attention: Richard Thatcher
Telephone: (804) 273-4410
Facsimile: (804) 273-4501
If to the Escrow Agent, at:
The Chase Manhattan Bank
450 West 33rd St
New York, NY 10001
Attention: Audrey Mohan
Telecopy: (212)-946-3751
Facsimile: (212)-946-8156
Unless otherwise specified herein, such notices or other communications
shall be deemed effective (a) on the date delivered, if delivered personally,
(b) one Business Day after being delivered, if delivered by telecopier with
confirmation of good transmission, (c) one Business Day after being sent by
overnight courier, if sent by overnight courier, (d) two Business Days after
being sent by Federal Express or United Parcel Service, if sent by Federal
Express or United Parcel Service, or (e) three Business Days after being sent,
if sent by registered or certified mail. Each of the parties hereto shall be
entitled to specify a different address by giving notice as aforesaid to each of
the other parties hereto.
7
<PAGE>
Section 3.2 Termination.
This Agreement shall automatically terminate upon the final distribution
of the Escrow Amount in accordance with the terms hereof, provided that the
provisions of Sections 2.6, 2.7 and 2.9 shall survive the termination of this
Agreement.
Section 3.3 Governing Law.
This Agreement shall be governed by the laws of the State of New York of
the United States of America and shall for all purposes be governed by and
construed in accordance with the laws of such state without regard to the
conflict of law rules thereof other than Section 5-1401 of the New York General
Obligations Law.
Section 3.4 Consent to Jurisdiction.
Each of the parties agrees that all actions, suits or proceedings arising
out of or based upon this Agreement or the subject matter hereof may be brought
and maintained in the federal district court in the Southern District of New
York. Each of the parties hereby by execution hereof (i) hereby irrevocably
submits to the non-exclusive jurisdiction of such court in New York, New York,
for the purpose of any action, suit or proceeding arising out of or based upon
this Agreement or the subject matter hereof and (ii) hereby waives to the extent
not prohibited by applicable law, and agrees not to assert, by way of motion, as
a defense or otherwise, in any such action, suit or proceeding, any claim that
it is not subject personally to the jurisdiction of the above-named court, that
it is immune from extraterritorial injunctive relief or other injunctive relief,
that its property is exempt or immune from attachment or execution, that any
such action, suit or proceeding may not be brought or maintained in the
above-named court should be dismissed on the grounds of forum non conveniens,
should be transferred to any court other than the above-named court, should be
stayed by virtue of the pendency of any other action, suit or proceeding in any
court other than the above-named court, or that this Agreement or the subject
matter hereof may not be enforced in or by the above-named court. Each of the
parties hereto hereby consents to service of process in any such suit, action or
proceeding in any manner permitted by the laws of the State of New York, agrees
that service of process by registered or certified mail, return receipt
requested, at the address specified in or pursuant to Section 3.1 hereof is
reasonably calculated to give actual notice and waives and agrees not to assert
by way of motion, as a defense or otherwise, in any such action, suit or
proceeding any claim that service of process made in accordance with Section 3.1
hereof does not constitute good and sufficient service of process. The
provisions of this Section 3.4 shall not restrict the ability of any party to
enforce in any court any judgment obtained in the federal district court in the
Southern District of New York.
Section 3.5 Waiver of Jury Trial.
To the extent not prohibited by applicable law which cannot be waived,
each of the parties hereto hereby waives, and covenants that it will not assert
(whether as plaintiff, defendant, or otherwise), any right to trial by jury in
any forum in any respect of any issue, claim, demand, cause of action, action,
suit or proceeding arising out of or based upon this Agreement or the subject
matter hereof, in each case whether now existing or hereafter arising and
whether in
8
<PAGE>
contract or tort or otherwise. Any of the parties hereto may file an original
counterpart or a copy of this Section 3.5 with any court as written evidence of
the consent of each of the parties hereto to the waiver of his or its right to
trial by jury.
Section 3.6 Reliance.
Each of the parties hereto acknowledges that it has been informed by each
other party that the provisions of this Section constitute a material inducement
upon which such party is relying and will rely in entering into this Agreement
and the transactions contemplated hereby.
Section 3.7 Entire Agreement; Waivers.
This Agreement constitutes the entire agreement among the parties hereto
pertaining to the subject matter hereof and supersedes all prior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, of the parties with respect to such subject matter. No
waiver of any provision of this Agreement (a) shall be deemed to or shall
constitute a waiver of any other provision hereof (whether or not similar), (b)
shall constitute a continuing waiver unless otherwise expressly provided therein
or (c) shall be effective unless in writing and executed by each party hereto.
Section 3.8 Amendment or Modification, etc.
The parties hereto may not amend or modify this Agreement except in such
manner as may be agreed upon by a written instrument executed by all of the
parties hereto. Any written amendment, modification or waiver executed by all of
the parties hereto shall be binding upon all such parties and their respective
successors and assigns.
Section 3.9 Headings, etc.
Section and subsection headings are not to be considered part of this
Agreement, are included solely for convenience, are not intended to be full or
accurate descriptions of the content thereof and shall not affect the
construction hereof. This Agreement shall be deemed to express the mutual intent
of the parties, and no rule of strict construction shall be applied against any
party.
Section 3.10 Severability.
In the event that any provision hereof would, under applicable law, be
invalid or unenforceable in any respect, such provision shall (to the extent
permitted by applicable law) be construed by modifying or limiting it so as to
be valid and enforceable to the maximum extent compatible with, and possible
under, applicable law. The provisions hereof are severable, and in the event any
provision hereof should be held invalid or unenforceable in any respect, it
shall not invalidate, render unenforceable or otherwise affect any other
provision hereof.
9
<PAGE>
Section 3.11 Counterparts.
This Agreement and any amendments, waivers, consents, or supplements may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which counterparts together shall constitute but
one and the same instrument. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto. Delivery of an
executed counterpart of a signature page to this Agreement or to any amendments,
waivers, consents or supplements hereof by telecopier shall be as effective as
delivery of a manually executed counterpart thereof.
Section 3.12 Successors and Assigns.
All of the terms and provisions of this Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
permitted transferees, successors and assigns (each of which shall be deemed to
be a party hereto for all purposes hereof). The Partnership and Virginia Power
may not assign its obligations hereunder without the prior written consent of
the non-assigning party. Except as expressly provided herein, this Agreement
shall not confer any right or remedy upon any person other than the parties and
their respective transferees, successors and assigns; provided, however, that
the rights and obligations of the Partnership under this Agreement shall be
subject to the rights of The Bank Of New York in its capacity as collateral
agent under the Second Amended and Restated Security Agreement dated as of May
21, 1999 between the Partnership and The Bank of New York.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
10
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on the day and year first above written.
VIRGINIA ELECTRIC AND POWER COMPANY,
as Virginia Power
By: /s/ R.T. THATCHER
------------------------------------
Name: R.T. Thatcher
Title: Vice President
LSP ENERGY LIMITED PARTNERSHIP,
as the Partnership
By: LSP Energy, Inc., as general partner
By: /s/ MARK BRENNAN
------------------------------------
Name: Mark Brennan
Title: Treasurer
THE CHASE MANHATTAN BANK,
as the Escrow Agent
By: /s/ SAVERIO A. LUNETTA
------------------------------------
Name: Saverio A. Lunetta
Title: Vice President
11
<PAGE>
SCHEDULE 1
Option 1:
15 basis points of the highest value of collateral held on deposit per annum or
any part thereof without proration for partial years, subject to a minimum of
$7,500.
$75 per investment (excludes Money Market, Trust Deposit Account or Chase Vista
Money Market Fund investments)
Option 2:
Annual Fee: $7,500
Escrow proceeds invested in the Chase Trust Deposit account (30 day LIBOR less
50 bps).
Above options include initial legal review and set-up of appropriate accounts.
12
