City clerk and solicitor Rick O’Connor informed council tonight lawyers have managed to immediately trash the deal with Plasco Energy Group for the proposed commercial plant. The outstanding issue is the $300,000 letter of credit to decommission the test plant on Trail Rd., as O’Connor explains in this memo.
At the Council meeting of February 25th, 2015, as part of the consideration of the Environment Committee’s report entitled, “Update on Plasco Long-Term Waste Conversion Agreement”, City Council approved the following recommendation (being Recommendation 3):
“That City Council approve the termination of the Long-Term Waste Conversion Agreement and Ancillary Agreements with the Plasco Energy Group (Plasco) as further described in the report.”
I am writing to advise that, as a result of out-of-court negotiations, the City has been able to secure the termination of the Plasco Long-Term Waste Conversion Agreements (for the commercial facility), effective immediately.
As well, the City’s Motion with respect to the other outstanding matters related to Plasco was before the Court in Toronto this morning. The Motion was adjourned in order to facilitate the ongoing negotiation process and it remains before the Court. It should be noted that an adjournment is not a cancellation. It simply gives the parties more time to finalize matters without using any court resources.
Plasco’s lawyers were originally opposing the Court hearing the City’s motion, which had been scheduled for this morning. In order to facilitate today’s settlement with respect to the termination of the Agreement for the commercial facility, the City’s lawyers agreed to undertake further negotiations related to the timing for the termination of the demonstration facility lease.
An adjournment with respect to the City’s motion to terminate the Demonstration Facility has, therefore, been granted by the Court. This extension has been granted without prejudice to the legal rights of the City to further pursue this matter in Court.
Finally, with the cooperation of Plasco and the Court appointed monitor, the City is attempting to conclude an arrangement to ensure that the City’s decommissioning security of $300,000 for the Demonstration Facility is preserved and immune from any other creditors in the CCAA proceeding.
As always, I will continue to update Members of Council with respect to any further developments on this matter.
M. Rick O’Connor