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EXHIBIT 10.15
NON-COMPETITION AGREEMENT
NON-COMPETITION AGREEMENT, dated as of November 5, 1999, between ORION
POWER HOLDINGS, INC., a Delaware corporation (the "Company") and TOKYO ELECTRIC
POWER COMPANY INTERNATIONAL, B.V., a corporation organized under the laws of
the Netherlands ("TEPCO International").
WITNESSETH
WHEREAS, GS CAPITAL PARTNERS II, L.P., a Delaware limited partnership
("GSCP"), and CONSTELLATION POWER SOURCE, INC., a Delaware corporation
("Constellation"), as of March 10, 1998, caused the formation of the Company
and entered into a Stockholders' Agreement relating thereto (the "Original
Stockholders' Agreement");
WHEREAS, the Company has been formed for the purpose of investing in
and managing the operations of electric generating assets in the United States
and Canada (the "Portfolio Assets");
WHEREAS, as of June 25, 1999, the Company, GSCP and Constellation
amended and restated the Original Stockholders' Agreement in its entirety (the
"First Amended and Restated Stockholders' Agreement");
WHEREAS, as of September 29, 1999, and October 4, 1999 Mitsubishi
Corporation ("Mitsubishi") and TEPCO International, respectively entered into
Subscription Agreements pursuant to which the Company committed to issue, and
Mitsubishi and TEPCO International committed to purchase, 77,419.355 and
51,612.903 shares, respectively, of Common Stock at the price of $1,550.00 per
share, for an aggregate purchase price of $120,000,000.00 and $80,000,000.00,
respectively;
WHEREAS, as of the date hereof, the Company, GSCP, Constellation,
Mitsubishi, TEPCO International and the other parties named therein amended and
restated the First Amended and Restated Stockholders' Agreement in its entirety
(the "Second Amended and Restated Stockholders' Agreement"); and
WHEREAS, the parties hereto intend to establish terms pursuant to
which TEPCO International and any Affiliate of TEPCO International
(collectively, the "TEPCO International Group") may engage in the acquisition
of Facilities.
NOW, THEREFORE, in consideration of the promises and of the mutual
commitments and obligations hereinafter set forth, the parties hereto hereby
agree as follows:
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SECTION 1. Definitions. As used herein, the following terms shall
have the following meanings:
"Auction" means the attempted sale of a Facility or Facilities
pursuant to which the owner of the Facility or Facilities has stated or
announced that it intends to have or is having discussions, for the purpose of
soliciting a bid or bids, with respect to such sale of the Facility or
Facilities, or interests therein with more than one potential buyer.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person.
"Facility" means an electric generating facility in the United States
or Canada that, at the time of any purchase or attempted purchase, is either
fully constructed or has, or has previously had, commercial operations.
"Greenfield Project" means a project to construct a new electric
generating facility in the United States or Canada when the interest to be
acquired is acquired prior to one hundred thirty five (135) days after the date
of commercial operation.
"IPO" means an underwritten offering or series of underwritten
offerings pursuant to which the common stock, par value $.01 per share ("Common
Stock") of the Company, becomes registered under Section 12 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") (a) in which either (i)
the Common Stock issued in such IPO constitutes at least 20% of the Common
Stock or (ii) the gross proceeds to the Company and any selling stockholders,
in the aggregate, is at least $75 million before deducting underwriting
discounts, commissions and offering expenses and (b) which results in the
Common Stock being held by at least 500 holders of record within the meaning of
Rule 12g5-1 under the Exchange Act.
"Negotiated Transaction" shall have the meaning set forth in Section
4.
"Person" means any individual, corporation, limited liability company,
limited or general partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, other entity or government or any
agency or political subdivisions thereof.
SECTION 2. Term. The term of this Agreement shall be from the date
hereof until the earlier to occur of (i) the closing of an IPO, (ii) six months
after the date on which all TEPCO International Group representatives or
nominees have ceased to hold any of the following positions of the Company:
director, observer, officer or employee, (iii) the liquidation of the Company,
and (iv) five years after the date hereof.
SECTION 3. Auctions. With respect to a Facility which is the subject
of an Auction, the TEPCO International Group shall be prohibited from bidding,
and shall
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not bid, or take any steps with the seller of the Facility or any other third
party to materially further the acquisition of such Facility, or any interest
therein ("Acquisition Actions"), unless the Company provides the TEPCO
International Group with prior written notice that the TEPCO International
Group may take Acquisition Actions with respect to such Facility (the "Granting
Notice"). Any Granting Notice shall be given by the Company in the sole
discretion of the Company and under no circumstance shall the Company be under
an obligation to provide a Granting Notice. If the Company provides to the
TEPCO International Group a Granting Notice with respect to a Facility, the
TEPCO International Group may take any and all Acquisition Actions with respect
to such Facility. The Company may, but shall be under no obligation to, proceed
with Acquisition Actions with respect to a Facility for which it did not
provide a Granting Notice.
SECTION 4. Negotiated Transactions. If the TEPCO International Group
wishes to take Acquisition Actions with respect to a Facility (the "Subject
Facility") which is not the subject of an Auction (any transaction, or
attempted transaction, to acquire any such Facility, or an interest therein, is
referred to as a "Negotiated Transaction"):
(i) the TEPCO International Group shall provide, in
good faith, taking into account all relevant facts and circumstances, the
Company with written notice (a "Facility Notice") including (a) the identity of
the Subject Facility, (b) a statement that the TEPCO International Group,
subject to this Section 4, intends to take Acquisition Actions to purchase such
Subject Facility, or an interest therein, and (c) a statement that the TEPCO
International Group believes it has a reasonable probability of acquiring such
Subject Facility, or an interest therein, in such Negotiated Transaction. The
Company shall provide a written response (a "Response") to any and all Facility
Notices, which Response shall indicate whether or not the Company intends to
take Acquisition Actions with respect to the purchase of the Subject Facility,
or an interest therein (a Response stating that the Company does not have such
intention is referred to as a "No Intention Response"). Such Response shall be
given in good faith, taking into account all relevant facts and circumstances,
within sufficient time (a "Response Period") to allow the TEPCO International
Group, if a No Intention Response is given, to pursue, on a commercially
reasonable basis, the purchase of such Subject Facility, or an interest
therein, in the Negotiated Transaction. Prior to the receipt of a Response to a
Facility Notice, the TEPCO International Group shall take no Acquisition
Actions with respect to the Subject Facility.
(ii) In the event the Company indicates in a Response
that it intends to take Acquisition Actions with respect to the purchase of the
Subject Facility, or an interest therein, through a Negotiated Transaction (a
"Positive Response"), the TEPCO International Group shall be precluded from
taking any Acquisition Actions with respect to the Subject Facility; provided,
however, that in the event that the Company, after
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initially giving a Positive Response with respect to the purchase of such
Subject Facility, or an interest therein, subsequently decides not to pursue
such purchase, the Company shall promptly provide a No Intention Response to
the TEPCO International Group with respect to such Subject Facility. If the
Company gives a No Intention Response, the TEPCO International Group shall have
the right to take Acquisition Actions with respect to the purchase of the
Subject Facility, or an interest therein.
(iii) In the event that, during negotiations with
respect to a Negotiated Transaction, the seller of the Subject Facility
commences an Auction, the provisions of Section 3 shall apply to such Subject
Facility, and the TEPCO International Group shall immediately terminate any
Acquisition Actions with respect to such Subject Facility unless a Granting
Notice is given with respect to such Subject Facility.
SECTION 5. Excluded Assets. Notwithstanding the foregoing, the TEPCO
International Group shall have the right to take Acquisition Actions, with
respect to (i) any interest in an existing Facility owned by the TEPCO
International Group as of the date of this Agreement, (ii) to a Greenfield
Project and (iii) any interest in a Facility in which TEPCO International and a
Person identified in a separate letter between the Company and TEPCO
International dated the date hereof, have a joint investment, whether before or
after the date of this Agreement.
SECTION 6. Representations and Warranties. Each party represents and
warrants to the other parties that: (i) it is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its formation, (ii)
it has all regulatory authorizations necessary for it to legally perform its
obligations under this Agreement and any other documentation relating to this
Agreement, (iii) the execution, delivery and performance of this Agreement and
any other documentation relating to this Agreement are within its powers, have
been duly authorized by all necessary action and do not violate any of the
terms and conditions in its governing documents, any material contracts to
which it is a party or any law, rule or regulation material to it or order or
the like applicable to it, (iv) this Agreement and each other document executed
and delivered in accordance with this Agreement constitutes its legally valid
and binding obligation enforceable against it in accordance with its terms, (v)
there are no bankruptcy proceedings pending or being contemplated by it or, to
its knowledge, threatened against it, and (vi) there is not pending or, to its
knowledge, threatened against it or any of its affiliates, any legal
proceedings that could materially adversely affect its ability to perform its
obligations under this Agreement or any other document relating to this
Agreement to which it is a party.
SECTION 7. Assignment. No party shall assign this Agreement or its
rights or obligations hereunder to any party without the prior written consent
of the other party.
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SECTION 8. Amendment and Waiver. No modification, amendment or waiver
of any provision of this Agreement shall be effective against any party unless
such modification, amendment or waiver is approved in writing by such party.
The failure of any party to enforce any of the provisions of this Agreement
shall in no way be construed as a waiver of such provisions and shall not
affect the right of such party thereafter to enforce each and every provision
of this Agreement in accordance with its terms.
SECTION 9. Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability shall
not affect any other provision or any other jurisdiction, but this Agreement
shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
SECTION 10. Entire Agreement. This Agreement and the other writings
referred to herein or delivered pursuant hereto which form a part hereof
contain the entire agreement and understanding among the parties hereto with
respect to the subject matter hereof and supersedes and preempts any prior
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.
SECTION 11. Counterparts. This Agreement may be executed in separate
counterparts each of which, when delivered to the other party, shall be an
original and all of which taken together shall constitute one and the same
agreement.
SECTION 12. Notices. Any notice provided for in this Agreement shall
be in writing and shall be either personally delivered or sent by facsimile or
reputable overnight courier service (charges prepaid) to the Company and TEPCO
International at the addresses set forth below, or at such address or to the
attention of such other person as the recipient party has specified by prior
written notice to the sending party. Notices will be deemed to have been given
hereunder when delivered personally or on receipt.
The Company's address is: Orion Power Holdings, Inc.
7 East Redwood Street
10th Floor
Baltimore, Maryland 21202
Facsimile: (410) 234-0994
Attention: General Counsel
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with a copy to:
Fried, Frank, Harris,
Shriver & Jacobson
One New York Plaza
New York, New York 10004
Facsimile: (212) 859-8000
Attention: Paul M. Reinstein, Esq.
TEPCO International Group's
address is: Tokyo Electric Power Company
International B.V.
Officia 1, De Boelelaan 7, 1083HJ
Amsterdam, The Netherlands
Facsimile: 31-20-642-7675
Attention: BTM Trust (Holland) B.V.
with a copy to:
The Tokyo Electric Power Company
1-3 Uchisaiwai-cho 1-chome Chiyoda-ku
Tokyo 100-0011 Japan
Facsimile: 81-3-3596-8438
Attention: Business Development Group
International Affairs Department
with a copy to:
Morgan, Lewis & Bockius LLP
300 S. Grand Avenue, 22nd Floor
Los Angeles, California 90071
Facsimile: (213) 612-2554
Attention: Richard A. Shortz, Esq
SECTION 13. Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial This Agreement shall be governed by and construed in accordance with the
laws of the State of New York without giving effect to the principles of
conflicts of law. Each of the parties hereto hereby irrevocably and
unconditionally consents to submit to the exclusive jurisdiction of the courts
of the State of New York and of the United States of America, in each case
located in the County of New York, for any action, proceeding or investigation
in any court or before any governmental authority ("Litigation") arising out of
or relating to this Agreement and the transactions contemplated hereby (and
agrees not to commence any Litigation relating thereto except in such courts),
and further agrees that service of any process, summons, notice or document by
U.S. registered mail to its respective address set forth in this Agreement
shall be effective service of process for any Litigation brought against it in
any such court. Each of the parties hereto hereby irrevocably and
unconditionally
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waives any objection to the laying of venue of any Litigation arising out of
this Agreement or the transactions contemplated hereby in the courts of the
State of New York or the United States of America, in each case located in the
County of New York, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such Litigation
brought in any such court has been brought in an inconvenient forum. Each of
the parties irrevocably and unconditionally waives, to the fullest extent
permitted by applicable law, any and all rights to trial by jury in connection
with any Litigation arising out of or relating to this Agreement or the
transactions contemplated hereby.
SECTION 14. Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of
this Agreement.
SECTION 15. Construction. Where specific language is used to clarify
by example a general statement contained herein, such specific language shall
not be deemed to modify, limit or restrict in any manner the construction of
the general statement to which it relates. The language used in this Agreement
shall be deemed to be the language chosen by the parties hereto to express
their mutual intent, and no rule of strict construction shall be applied
against any party.
SECTION 16. Remedies. Each party hereto shall be entitled to enforce
its rights under this Agreement specifically to recover damages by reason of
any breach of any provision of this Agreement and to exercise all other rights
existing in its favor. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that each party may in its sole discretion apply to any court of
law or equity of competent jurisdiction for specific performance and/or
injunctive relief (without posting a bond or other security) in order to
enforce or prevent any violation of the provisions of this Agreement. In no
case shall any party be liable to the other for a breach of this Agreement for
consequential, indirect, punitive or special damages.
SECTION 17. Confidentiality. The parties hereto shall keep the
existence and the terms of this Agreement strictly confidential unless (i) the
disclosing party has received the advice of independent counsel that such
disclosure is required by any law (including, without limitation, any judicial
order) or other requirement of any governmental entity to which the disclosing
party is subject (provided that prior to such disclosure, the disclosing party
promptly advises and consults with the non-disclosing parties concerning the
information it proposes to disclose), (ii) the disclosing party discloses such
information to a potential purchaser of Company equity held by the disclosing
party (provided that prior to such disclosure, the potential purchaser executes
a confidentiality agreement imposing confidentiality obligations on such
potential purchaser with respect to any non-competition agreement substantially
identical to the confidentiality obligations imposed by this Section 17) or
(iii) such
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information becomes publicly available (other than as a result of any act or
omission by such disclosing party).
[INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
ORION POWER HOLDINGS, INC.
By:
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Name: Jack Fusco
Title: Chief Operating Officer
TOKYO ELECTRIC POWER COMPANY
INTERNATIONAL, B.V.
By:
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Name:
Title:
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TOKYO ELECTRIC POWER COMPANY INTERNATIONAL B.V.
Officia 1, De Boelelaan 7, 1083HJ
Amsterdam, The Netherlands
November ___, 1999
Orion Power Holdings, Inc.
7 East Redwood Street, 10th Floor
Baltimore, Maryland 21202
RE: NON-COMPETITION AGREEMENT, BY AND BETWEEN TOKYO ELECTRIC POWER COMPANY
INTERNATIONAL B.V. AND ORION POWER HOLDINGS, INC., DATED AS OF EVEN
DATE HEREWITH
Ladies and Gentlemen:
Reference is hereby made to that certain Non-Competition Agreement, by and
between Tokyo Electric Power Company International B.V. ("TEPCO International")
and Orion Power Holdings, Inc. ("Orion"), dated as of even date herewith (the
"Non-Competition Agreement"). Capitalized terms used herein but not otherwise
defined shall have the meaning ascribed to them in the Non-Competition
Agreement.
For purposes of Section 5(iii) of the Non-Competition Agreement, TEPCO
International and Orion hereby agree that the Persons to be identified in
accordance with the terms thereof is hereby identified as Tenaska, Inc. and its
affiliates.
Sincerely yours,
TOKYO ELECTRIC POWER COMPANY
INTERNATIONAL B.V.
By:
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Name:
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Its:
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AGREED AND ACKNOWLEDGED:
ORION POWER HOLDINGS, INC.
By:
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Name:
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Its:
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