Exhibit 99.5
EXECUTION COPY
RIGHT OF FIRST REFUSAL AGREEMENT
RIGHT OF FIRST REFUSAL AGREEMENT (this "Agreement") dated as of March 22,
2007, by and between KEYSPAN GENERATION LLC, a limited liability company
organized and existing under the laws of the State of New York ("Genco"), and
Long Island Lighting Company d/b/a LIPA, a wholly-owned subsidiary of Long
Island Power Authority, a corporate municipal instrumentality and political
subdivision of the State of New York ("LIPA").
W I T N E S S E T H:
WHEREAS, Xxxxx, XXXX and certain of their affiliates have entered into a
certain Agreement and Waiver dated as of the date hereof (the "Waiver
Agreement");
WHEREAS, in the Waiver Agreement, among other things, Genco has agreed to
xxxxx XXXX a right of first refusal ("ROFR") to purchase Genco's electric
generating facilities supplying power to LIPA under the Power Supply Agreement,
dated June 26, 1997 between the parties (the "PSA") in the event Genco proposes
to sell or otherwise dispose of such generating facilities to a Foreign or
Foreign Controlled Entity (as hereinafter defined); and
WHEREAS, Genco and LIPA wish to provide in this Agreement for the terms and
conditions of the ROFR as contemplated by the Waiver Agreement.
NOW THEREFORE, in consideration of the premises and of such other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto intending to be legally bound agree as follows:
SECTION 1. Right of First Refusal.
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1.1 Grant. Genco hereby grants to LIPA an irrevocable exclusive right to
purchase, subject to the terms and conditions hereof, Genco's Generating
Facilities (as such term is defined in the PSA in the event that Genco intends
to accept one or more bona fide offers (collectively, an "Offer") to purchase
any such Generating Facilities from a Foreign or Foreign Controlled Person (as
defined immediately below) during the term of the PSA. For purposes of this
Agreement, a Foreign or Foreign Controlled Person shall mean the following:
"Any natural person, corporation, society, limited liability
company, partnership, joint venture, unincorporated association
or other entity whatsoever, incorporated or organized under the
laws of a jurisdiction other than the United States, or directly
or indirectly controlling or controlled by any such person or
entity or under direct or indirect common control with any such
person or entity. For purposes of this definition, "control"
shall mean (a) the ownership, whether direct or indirect, of 35
percent or more of the voting securities or other voting
interests of such person or entity (or of securities or interests
convertible into such voting securities or interests) or (b) the
power (whether direct or indirect) to direct or cause the
direction of the management or policies of such person or entity
whether through the ownership of voting securities, contract or
otherwise."
1.2 Notice of Offer. Should Genco intend to accept an Offer from any
Foreign or Foreign Controlled Person to purchase Genco's Generating Facilities,
Genco shall immediately deliver a notice (the "Offer Notice") to LIPA (a)
forwarding a copy of each document containing the terms and conditions of the
Offer and (b) stating all of the terms and conditions of the Offer including,
without limitation, the nature of such purchase or transfer, the specific
Generating Stations which are subject to the Offer, the amount and form of the
consideration to be paid, all in reasonable detail, and the name and address of
each prospective purchaser or transferee, to the extent not included in
documentation forwarded with the Offer Notice.
1.3 Right of First Refusal. LIPA shall have an option, for a period of 90
days after receiving the Offer Notice, to give written notice to Genco of its
election to purchase all, but not less than all, of the Generating Facilities
which are the subject of the Offer at the price and upon the material terms and
conditions specified in the Offer Notice. In the event that LIPA does not elect
to purchase such Generating Facilities, Genco may consummate (on the same
material terms and conditions as set forth in the Offer Notice) the proposed
sale or transfer of such Generation Facilities to such Foreign or Foreign
Controlled Person; provided, however, that such purchase or transfer must be
consummated no later than 270 days following the earlier of either (i) the
ninety-first day following LIPA's receipt of the Offer Notice, or (ii) LIPA's
written notification that it will not exercise its Option. In the event that
such purchase or transfer is not consummated within such 270-day period, then
Genco may not sell or transfer such Generating Facilities to a Foreign or a
Foreign Controlled Person without first complying with all of the provisions of
this Section 1. Failure of LIPA to provide a written response to Genco accepting
such terms within such 90-day period shall be deemed an election by LIPA not to
exercise its option to purchase such Generating Facilities. In the event that
LIPA properly and timely gives written notice to Genco of its election to
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purchase such Generating Facilities in the manner set forth in the Offer Notice,
the parties will promptly negotiate, execute and deliver a purchase and sale
agreement consistent with the terms set forth in the Offer Notice and
substantially consistent with the Second Option and Purchase and Sale Agreement,
dated as of the date hereof, between the parties subject to the receipt of
necessary regulatory approvals.
SECTION 2. Due Diligence.
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Upon reasonable advance notice from LIPA, and in connection with LIPA's
rights hereunder, Genco shall provide LIPA and its representatives prompt, full
and complete access to the assets and the books, records and documents of Genco
and its affiliates to the extent such affiliates possess relevant books, records
and documents during normal business hours or such other hours and Genco and
LIPA shall agree and Genco shall make available the officers, employees,
attorneys, independent accountants and other agents of Genco and its affiliates
to discuss the condition and all other aspects of the Generating Facilities in
furtherance hereof.
SECTION 3. General Provisions.
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3.1 Notices. All notices and other communications given or made pursuant to
this Agreement shall be in writing and shall be deemed to have been duly given
or made if (i) sent by registered or certified mail, return receipt requested,
or (ii) hand delivered, or (iii) sent by prepaid overnight carrier, with a
record of receipt, to the parties at the following addresses (or at such other
addresses as shall be specified by the parties by like notice):
if to LIPA: Long Island Power Authority
000 Xxxxx Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: General Counsel
and to: Xxxxxx Xxxx Xxxxx Raysman & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx
if to Genco: KeySpan Generation LLC
000 Xxxx Xxx Xxxxxxx Xx
Xxxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxxx
and to: KeySpan Corporation
Xxx XxxxxXxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attn: Xxxx X. Xxxxxx, Xx.
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if to National Grid: National Grid USA
00 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxxxx X. Xxxxxx
Each notice or communication shall be deemed to have been given on the date
received.
3.2 Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
3.3 Miscellaneous. This Agreement, together with the Waiver Agreement: (i)
constitutes the entire agreement and supersede all other prior agreements and
understandings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof; (ii) shall be binding upon, and inure to
the benefit of, the parties hereto and thereto and their respective successors
and permitted assigns and are not intended to confer upon any other person, any
rights or remedies hereunder or thereunder; and (iii) may be executed in two or
more counterparts which together shall constitute a single agreement.
3.4 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York (without giving effect to
conflict of law principles) as to all matters, including but not limited to
matters of validity, construction, effect, performance and remedies. THE PARTIES
HERETO AGREE THAT VENUE IN ANY AND ALL ACTIONS AND PROCEEDINGS RELATED TO THE
SUBJECT MATTER OF THIS AGREEMENT SHALL BE IN THE STATE COURTS IN AND FOR NASSAU
COUNTY, NEW YORK OR THE FEDERAL COURTS IN AND FOR THE EASTERN DISTRICT OF NEW
YORK, WHICH COURTS SHALL HAVE EXCLUSIVE JURISDICTION FOR SUCH PURPOSE, AND THE
PARTIES HERETO IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS
AND IRREVOCABLY WAIVE THE DEFENSE OR AN INCONVENIENT FORUM TO THE MAINTENANCE OF
ANY SUCH ACTION OR PROCEEDING. SERVICE OF PROCESS MAY BE MADE IN ANY MANNER
RECOGNIZED BY SUCH COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ITS
RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY
DISPUTE IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
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3.5 Assignment. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by the parties hereto without the prior
written consent of the other parties. No party shall be relieved of any
liability arising hereunder in respect of any assignment pursuant to this
Section, unless such assignor has received a written release expressly excepting
such assignor from any liability that may arise hereunder.
3.6 Waiver; Amendment. No waiver by any party hereto of any term, condition
or obligation of this Agreement shall be valid unless in writing and signed by
the waiving party. No failure or delay by either party hereto at any time to
require the other party hereto to perform strictly in accordance with the terms
hereof shall preclude such party from requiring performance by such other party
hereto at any later time. No waiver of any one or several of the terms,
conditions or obligations of this Agreement, and no partial waiver thereof,
shall be construed as a waiver of any of the other terms, conditions or
obligations of this Agreement. This Agreement may not be amended, changed or
modified in any fashion except by written instrument signed by each of the
parties hereto.
3.7 Further Assurances. The parties hereto agree to execute and deliver
such other instruments, agreements and other documents and to take such other
action as may be reasonably necessary to further the purposes of the Agreement.
3.8 Representations and Warranties. Genco hereby represents and warrants to
LIPA, and LIPA hereby represents and warrants to Genco that:
3.8.1 Due Authorization and Binding Obligation. Such party has duly
authorized the execution and delivery of this Agreement. This Agreement has
been duly executed and delivered by such party. No consent or authorization
of, filing with, notice to, or other act by or in respect of any
governmental authority or any other person is required in connection with
the execution, delivery, validity or enforceability of this Agreement
except for, in the case of LIPA (a) receipt of approval of the New York
State Attorney General (as to form) and (b) receipt of approval of the New
York State Comptroller (such approvals being collectively referred to as
the "Governmental Approvals").
3.8.2 No Conflict. The execution and the delivery by such party of
this Agreement will not (a) upon receipt of the Governmental Approvals,
conflict with, violate or result in a breach of any law or governmental
regulation applicable to such party or (b) conflict with, violate or result
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in a breach of any term or condition of any judgment, decree, agreement or
instrument to which such party is a party or by which such party or any of
its properties or assets are bound, or constitute a default under such
judgment, decree, agreement or instrument.
3.8.3 No Litigation. There is no action, suit or other proceeding, at
law or in equity, before or by any court or governmental authority pending
or to such party's best knowledge, threatened, which relates to this
Agreement.
3.9 Fees and Expenses. Each party shall bear its own costs and expenses
(including those of such party's legal, financial and other advisors) incurred
in connection with the transactions contemplated by this Agreement.
3.10 Effective Date. This Agreement shall become legally binding and
effective only upon the Effective Date of the Waiver Agreement (as such term is
defined in the Waiver Agreement).
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IN WITNESS WHEREOF, each party hereto has duly executed this Agreement as
of the date first above written.
KEYSPAN GENERATION LLC LONG ISLAND LIGHTING COMPANY
d/b/a/ LIPA
By: /s/Xxxxxxx X. Xxxxxx
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By: /s/Xxxx X. Xxxxxx Xx. Name: Xxxxxxx X. Xxxxxx
------------------------ Title: CEO & President
Name: Xxxx X. Xxxxxx Xx.
Title: Executive Vice President
Agreed to and Acknowledged:
NATIONAL GRID USA
By: /s/Xxxxxxxx X. Xxxxxx
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Name: Xxxxxxxx X. Xxxxxx
Title: Executive Vice President and
General Counsel
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