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Exelon unit agrees to end coal-fired power lease agreement for $360M

UII LLC has agreed to terminate its coal-fired power-relatedlease agreements with the Municipal Electric Authority of Georgia for $360million. The termination will yield UII owner an after-tax gain of $2.6million.

"[I]t is in Exelon's best interest to terminate the[leases], due in part to certain economic uncertainties with respect to the endof term options … including the likelihood of UII incurring significant capitalexpenditures and increased operational risk," the company said in a Form8-K filed April 1.

UII invested in coal-fired generating station leases in 2000which were then leased back to the Municipal Electric Authority of Georgia andCity of San Antonio, Texas, through the City Public Service Board of SanAntonio, Texas.

The City Public Service Board terminated its lease agreementin February 2014 for a payment of $335 million to Exelon.