NONCOMPETITION AND LICENSE AGREEMENT
This Noncompetition and License Agreement ("Agreement"), is made this
31st day of July, 2000, by and between Columbia Energy Group, a Delaware
corporation ("Columbia"), and The New Power Company, a Delaware corporation
("New Power"), and is effective as of the Effective Date (as hereinafter
defined).
WITNESSETH:
WHEREAS, pursuant to the Asset Purchase Agreement, New Power is
acquiring the Specified Assets from Sellers; and
WHEREAS, as a material condition to New Power's obligation to
consummate the transactions contemplated by the Asset Purchase Agreement, and
for the consideration described herein, Columbia has agreed to enter into this
Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the parties
hereto agree as follows:
1. DEFINITIONS. In this Agreement:
"AFFILIATES" shall have the meaning set out in Section 1.1 of the Asset
Purchase Agreement.
"ASSET PURCHASE AGREEMENT" shall mean that certain Asset Purchase
Agreement dated June 29, 2000, by and among Columbia Energy Services
Corporation, Columbia Energy Retail Corporation, and Columbia Energy
Power Marketing Corporation, as Sellers, TNPC, Inc., and New Power, as
Buyer, for the acquisition of the Specified Assets by New Power.
"CLOSING DATE" shall have the meaning set out in Section 1.1 of the
Asset Purchase Agreement.
"COMPETING BUSINESS" shall have the meaning set out in Section 3
hereof.
"EFFECTIVE DATE" shall mean the Closing Date.
"FIELD OF USE" shall have the meaning set out in Section 6.1 hereof.
"JURISDICTIONS" shall have the meaning set out in Section 1.1 of the
Asset Purchase Agreement.
"MASS MARKETS BUSINESS" shall have the meaning set out in Section 1.1
of the Asset Purchase Agreement.
"NON-COMPETE PERIOD" shall have the meaning set out in Section 3
hereof.
"NOTICE" shall have the meaning set out in Section 10 hereof.
"PERMITTED COMPETITORS" shall have the meaning set out in Section 3
hereof.
"SPECIFIED ASSETS" shall have the meaning set out in Section 1.1 of the
Asset Purchase Agreement.
"TRADEMARKS" shall have the meaning set out in Section 6.1 hereof.
2. CONSIDERATION FOR COVENANTS. The consideration for the
promises and covenants contained herein is as set forth in the Asset Purchase
Agreement and other good and valuable consideration.
3. COVENANT NOT TO COMPETE. Columbia covenants and agrees that,
for a period of three (3) years following the Closing Date (said three (3) year
period, the "Non-Compete Period") it shall not engage, and it shall cause its
Affiliates not to engage, directly or indirectly, whether as principal or as
agent, partner, member, representative, shareholder or otherwise, alone or in
association with any other Person, in any Competing Business in any
Jurisdiction; provided, however, that notwithstanding the foregoing, Columbia
may own, directly or indirectly, solely as an investment, securities of any
person, firm, or entity which are publicly traded if Columbia (a) is not a
controlling person of, or a member of a group which controls, such person, firm,
or entity; (b) does not, directly or indirectly, own five percent (5%) or more
of any class of securities of such person, firm, or entity; or (c) does not
interfere with business relationships (whether formed heretofore or hereafter)
between such Competing Business and any customers or suppliers of the Competing
Business.
For purposes of this Agreement, the term "Competing Business" shall
mean the business of retail marketing and sale to residential and light
commercial customers of natural gas and/or electricity commodities; and the term
"light commercial customer" shall mean a commercial customer that, on a per
site, store or facility basis, consumes annually 10,000 MMBtu or less of natural
gas. Notwithstanding the foregoing, the Affiliates of Columbia whose businesses
are regulated by either a state Public Utility Commission or Public Service
Commission or the Federal Energy Regulatory Commission, in each case only as
long as such entity is a regulated entity (the "Permitted Competitors") shall
have the right to engage in a Competing Business. The term "Competing Business"
shall not include supplying electricity to the host site of a power generation
facility or the purchase or sale of electricity or ancillary services by a power
generation facility owned by Columbia Electric Corporation, or a 50% or more
owned subsidiary thereof.
4. NON-SOLICITATION OF CUSTOMERS. Columbia agrees that during the
Non-Compete Period it shall not, and it shall cause its Affiliates (other than
the Permitted Competitors) not to (a) solicit, directly or indirectly, with
respect to any Competing Business in any Jurisdiction, the trade of or trade
with any customers of New Power or any of its Affiliates, or (b) intentionally
interfere with the customer relationships of New Power or any of its Affiliates
with respect to any Competing
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Business in any Jurisdiction. For the purposes of this section, the publication
or advertisement by any Permitted Competitor or by Columbia on behalf of any
Permitted Competitor of a general solicitation for customers in a newspaper or
other publication or media of general interest, and the employment of any
employee of New Power or any of its Affiliates who responds to a general
solicitation for employment not targeted at such employee, shall not be a breach
hereof.
5. NON-SOLICITATION OF EMPLOYEES. Columbia agrees that during the
Non-Compete Period it shall not solicit or induce, or attempt to solicit or
induce, and it shall cause its Affiliates (other than the Permitted Competitors)
not to solicit or induce or attempt to solicit or induce, directly or
indirectly, any employee of New Power or any of its Affiliates to leave such
employ for any reason associated with Competing Business in any Jurisdiction.
For the purposes of this section, the publication or advertisement by Columbia
or any Affiliate of a general solicitation for employment in a newspaper, trade
journal or other publication or media of general interest, and the employment of
any employee of New Power or any of its Affiliates who responds to a general
solicitation for employment not targeted at a specific employee, shall not be a
breach hereof.
6. TRADEMARK LICENSE
6.1 GRANT. Columbia hereby grants to New Power an
exclusive right and privilege to use in the Jurisdictions those trademarks,
service marks and trade names specifically listed on Schedule A attached to and
made a part hereof (each a "Trademark" or collectively the "Trademarks") upon or
in connection with the provision, promotion and sale of retail residential and
small commercial natural gas and electricity commodities (collectively, the
"Field of Use"). No other rights relating to the Trademarks are granted herein.
6.2 SUBLICENSES. Notwithstanding the foregoing, New Power
shall have the right to grant sublicenses in the Field of Use to any of its
wholly-owned subsidiaries on the condition that any such sublicenses to be
subject to the terms and conditions of this Agreement.
6.3 MARKING. New Power shall comply with the marking
requirements of the Jurisdictions in which New Power uses the Trademarks and use
the registered trademark symbol "(R)" with each of the Trademarks when a
Trademark is used in connection with the goods/services specified in the
registration. New Power shall only use the Trademarks as set forth herein.
6.4 APPROVAL OF TRADEMARK USE. To assure that the
packaging, appearance, quality and distribution of the goods and services used
in association with the Trademarks meet Columbia's standards, Columbia retains
the right to approve of any packaging, manufacture, appearance, quality and
distribution of the goods or services offered by New Power in association with
the Trademarks, which approval shall not be unreasonably withheld or delayed. In
conjunction therewith, Columbia has the right to reasonably inspect the goods
and services offered by New Power in association with the Trademarks.
Notwithstanding the foregoing, Columbia acknowledges that the goods and services
offered by Columbia in the Mass Markets
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Business and the goods and services offered by New Power satisfy Columbia's
standards of quality.
6.5 OWNERSHIP OF TRADEMARKS. New Power acknowledges the
ownership of the Trademarks in Columbia, agrees that it will do nothing
inconsistent with such ownership and that all use of the Trademarks by New Power
shall inure to the benefit of and be on behalf of Columbia, and agrees to assist
Columbia in recording this Agreement with appropriate government authorities if
necessary. New Power agrees that nothing in this Agreement shall give New Power
any right, title or interest in or to the Trademarks other than the right to use
the Trademarks in accordance with this Agreement and New Power agrees that it
will not attack the title of Columbia to the Trademarks or attack the validity
of this Agreement.
6.6 POLICING. Each party shall promptly and fully advise
the other of any action by a third party which impairs or has a tendency to
impair the trademark value of any Trademark, including any misuse of any
Trademark which is likely to erode the distinctive attributes. The parties shall
cooperate in a concerted policing effort to avoid generic or descriptive use of
the Trademarks.
6.7 ENFORCEMENT. Columbia shall have the right but not
the obligation to take such action as it shall deem appropriate to enforce
trademark rights against infringers. Consistent therewith, Columbia shall
control those actions and may make demands, institute suit and/or undertake
settlement or otherwise compromise claims in respect of third party use or
misuse of any Trademark. In the event Columbia elects not to enforce its rights
hereunder, New Power, at its own expense, may enforce the Trademark rights and
shall be entitled to all recoveries from such enforcement, provided that New
Power may not enter into a settlement or consent agreement regarding one or more
of the Trademarks without Columbia's consent, which consent shall not be
unreasonably withheld, conditioned or delayed.
6.8 TERM. The Trademark license rights granted under this
Section 6 shall expire three (3) years from the Effective Date. Upon expiration,
New Power agrees immediately to discontinue all use of the Trademarks.
7. PROHIBITED USE. For a period of three (3) years following the
Closing Date, Columbia shall not use, and shall cause its Affiliates not to use,
directly or indirectly, the Trademarks within the Field of Use in the
Jurisdictions. Notwithstanding the foregoing, nothing herein shall prevent
Columbia from continuing to use any other or its trademarks not specifically
listed on Exhibit A.
8. MARKETS. Columbia and New Power acknowledge and agree that
this Agreement is subject to Section 7.13 of the Asset Purchase Agreement.
9. SEVERABILITY. The covenants contained herein shall be
construed as a series of separate and severable covenants. Columbia agrees that
if any court of competent jurisdiction determines that any such separate
covenant is not fully enforceable pursuant to its terms, such covenant shall be
deemed modified or severed and that the remainder of such covenant and of
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this Agreement shall be enforced to the fullest extent permitted by applicable
law and consistent with the intent of the parties expressed hereunder.
10. INJUNCTIVE RELIEF. The parties acknowledge and agree that the
covenants and obligations hereunder are of special and unique character and that
any breach of any such covenants or obligations would cause irreparable harm for
which remedies at law are inadequate. Such non-breaching party shall have the
right to injunctive or other equitable relief, in addition to all of its other
rights and remedies at law or in equity, to enforce the provisions of this
Agreement. All costs and expenses (including attorneys' fees and costs incurred
in arbitration proceedings) reasonably incurred in any dispute concerning the
enforcement of this Agreement shall be borne by the non-prevailing party.
11. BINDING EFFECT AND ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefits of the parties hereto and their successors and
permitted assigns; but neither this Agreement nor any of the rights, benefits or
obligations hereunder shall be assigned by either party without the prior
written consent of the non-assigning party, such consent not to be unreasonably
withheld; provided, however, that this Agreement and all rights hereunder may be
assigned by either party without the prior written consent of the non-assigning
party to any corporation or other business entity that succeeds to all or
substantially all of the assigning party's business through merger,
consolidation, or corporate reorganization, or by acquisition of all or
substantially all of the assets of the assigning party, and assumes the
assigning party's obligations under this Agreement.
12. NOTICES. Any notice, request, instruction, correspondence or
other document required to be given hereunder by any party to another (herein
collectively called "Notice") shall be in writing and delivered in person or by
courier service requiring acknowledgment of delivery or mailed by certified
mail, postage prepaid and return receipt requested, or by telecopier, as
follows:
If to Columbia, addressed to:
Columbia Energy Group
00000 Xxxxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx Xxxxxx
Telecopier No.: (000) 000-0000
With a copy to:
Xxxxx & Xxxxxxx, L.L.P.
0000 Xxxxxxxxxx Xxxxx
Xxxxx 0000
XxXxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Xx., Esq.
Telecopier No.: (000) 000-0000
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If to New Power, addressed to:
The New Power Company
00 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Managing Director, Law and
Government Affairs
Telecopier No.: (000) 000-0000
With a copy to:
Xxxxxxxxx & Xxxxxxxxx, L.L.P.
0000 X Xxxxxx, XX, Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopier No.(000) 000-0000
Notice given by personal delivery or courier service shall be effective upon
actual receipt. Notice given by mail shall be effective five days after deposit
with the United States postal service. Notice given by telecopier shall be
confirmed by appropriate answer back and shall be effective upon actual receipt
if received during the recipient's normal business hours, or at the beginning of
the recipient's next business day after receipt if received before the
recipient's normal business hours. All Notices by telecopier shall be confirmed
promptly after transmission in writing by regular mail or personal delivery. Any
party may change any address to which Notice is to be given to it by giving
Notice as provided above of such change of address.
13. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument.
14. DISPUTE RESOLUTION. Any controversy or claim arising out of or
relating to this Agreement or the breach, termination, validity or
enforceability hereof shall addressed and settled in the manner provided in
Article XIV of the Asset Purchase Agreement, the terms and conditions of which
are hereby incorporated herein in their entirety.
15. ENTIRE AGREEMENT. This Agreement supersedes all prior
agreements whether written or oral and constitutes the entire agreement between
the parties with respect to the subject matter hereof. There shall be no
modification, amendment, waiver or alteration of this Agreement, except in
writing and signed by duly authorized officers of the parties. Any waiver of any
terms or conditions hereof by either party shall not be construed as a
continuing waiver but shall only apply to the particular transaction involved.
16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with laws of the State of Delaware, without regard to
its conflict of laws rules or principles.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the Effective Date.
COLUMBIA ENERGY GROUP
By: /s/ X.X. X'XXXXXXX
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Name: X.X. X'Xxxxxxx
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Title: Senior Vice President & CFO
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THE NEW POWER COMPANY
By: /s/ XXXXXXXX X. XXXXXXXX
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Name: Xxxxxxxx X. Xxxxxxxx
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Title: Vice President
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SCHEDULE A
COLUMBIA NAME AND MARKS
CES (Registration No. 2,288,429)
Columbia Energy Services (Registration No. 2,094,506)
Columbia Energy Services.... Your Energy Solution & design
(Registration No. 2,114,397)
The Columbia Energy Market Center (Registration No. 2,092,434)
The Fast Lane (Registration No. 2,021,784)
Neighbors and Friends
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