EXHIBIT 10(iii)
ALLIANCE AGREEMENT
THIS ALLIANCE AGREEMENT (the "Agreement") is made as of April 14, 1999,
between CNG POWER COMPANY, a Delaware corporation ("CNG"), and DOMINION
RESOURCES, INC., a Virginia corporation ("DRI").
INTRODUCTION
A. DRI, though its subsidiaries, is engaged in the business of developing,
owning and operating energy facilities, including gas-fired electric generation
facilities. DRI desires to expand its ownership of energy facilities
principally in the area from New England to the states comprising the Mid-
America Interconnected Network.
B. CNG is engaged in the business of developing and owning independent
power projects.
C. In order to further DRI's desire to expand its ownership of energy
facilities in the area which includes major portions of the pipeline system of
CNG's Affiliates, and to further CNG's desire to expand the market for gas along
the pipeline system of CNG's Affiliates through the development of gas-fired
electric generation facilities, DRI and CNG have entered into this Agreement.
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms shall have the meanings
set forth below:
"Acceptance Notice" shall have the meaning set forth in Section 7.3
"Affiliate" shall mean as to any Person, any other Person that directly or
indirectly controls, is controlled by, or is under common control with such
first Person. A Person shall be deemed to control another Person if such Person
(i) possesses, directly or indirectly, the power to direct or cause the
direction of the management or policies of such other Person, whether through
the ownership of voting securities, by contract or otherwise, or (ii) owns or
controls 10 percent or more of the equity securities of such other Person.
"Agreement" shall have the meaning set forth in the first paragraph hereof.
"Alliance Information" shall mean all data, evaluations, projections and
other information provided by one Party to the other pursuant to this Agreement
and all information developed by or on behalf of the Parties pursuant to their
activities under this Agreement (including, without limitation Development Site
locations).
"CNG" shall have the meaning set forth in the first paragraph hereof.
"CNG Manager" shall have the meaning set forth in Section 2.4(b).
"Confidential Information" shall have the meaning set forth in Section
5.1(a).
"Development Area" means the area within a three-mile radius of a
Development Site.
"Development Entity" shall have the meaning set forth in Section 3.4(a).
"Development Sites" means, for any date, all of the Existing Sites and any
Development Sites which have been identified by the Management Committee
pursuant to Section 3.1 on or before such date, less any Development Sites which
the Management Committee has eliminated from the list of Development Sites prior
to such date pursuant to Section 3.1.
"Dominion Manager" shall have the meaning set forth in Section 2.4(b).
"DRI" shall have the meaning set forth in the first paragraph hereof.
"Existing Sites" shall have the meaning set forth in Section 3.1.
"Facilities" shall mean gas-fired electric generation facilities.
"Management Committee" shall have the meaning set forth in Section 2.4(a).
"Manager" shall have the meaning set forth in Section 2.4(b).
"No Purchase Termination" shall have the meaning set forth in Section 7.3.
"Notes" shall have the meaning set forth in Section 5.1(b).
"Party" shall mean each of CNG and DRI.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other legal entity.
"Purchase Termination" shall have the meaning set forth in Section 7.3.
"Receipt Date" shall have the meaning set forth in Section 7.2.
"Receiving Party" shall have the meaning set forth in Section 7.2.
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"Representative" shall mean, with respect to a Party, the officers,
directors, employees, agents, representatives and advisors of such Party and its
Affiliates.
"Resolution Period" shall have the meaning set forth in Section 7.1(b).
"Response" shall have the meaning set forth in Section 7.4.
"Sites" shall have the meaning set forth in Section 2.2.
"Tendered Interest" shall have the meaning set forth in Section 7.4(a).
"Terminating Party" shall have the meaning set forth in Section 7.2.
"Termination Date" shall have the meaning set forth in Section 7.2.
"Termination Notice" shall have the meaning set forth in Section 7.2.
"Termination Price" shall have the meaning set forth in Section 7.2.
"Transfer Agreement" shall have the meaning set forth in Section 7.2.
"Transfer of Control" shall mean: (i) with respect to DRI, the transfer of
ownership or control of a majority of the voting equity interests in DRI,
whether in one transaction or a series of transactions, to a Person and any
Affiliates of such Person or (ii) with respect to CNG, the transfer of ownership
or control of a majority of the voting equity interests in either CNG or
Consolidated Natural Gas Company, whether in one transaction or a series of
transactions, to a Person and any Affiliates of such Person.
ARTICLE II
THE ALLIANCE
SECTION 2.1 BASIC AGREEMENT. On the terms and subject to the conditions
set forth in this Agreement, the Parties hereby agree to form an alliance to
undertake the activities contemplated herein.
SECTION 2.2 PURPOSE OF THE ALLIANCE. The purpose of the alliance will be
to identify and evaluate potential sites ("Sites") for the development of
Facilities to be located generally along the pipeline system of CNG's Affiliates
in Ohio, Pennsylvania, New York, West Virginia and Virginia, and, through one or
more Affiliates of the Parties, to seek to develop, own, operate and maintain
such Facilities and to market power and other energy products generated thereby.
SECTION 2.3 RIGHTS OF PARTIES IN ALLIANCE INFORMATION AND RIGHTS. All
Alliance Information and all permits and development rights in or with respect
to any Development Site owned or controlled by either Party or its Affiliates
shall be available
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for use by both Parties in connection with the identification, evaluation and
development of Development Sites.
SECTION 2.4 MANAGEMENT COMMITTEE.
(a) The management of the Parties' activities pursuant to this
Agreement will be conducted through a management committee (the "Management
Committee") which will be empowered to set policy for, and to make all decisions
in respect of, any activities conducted by the Parties hereunder. The acts of
the Management Committee shall bind the Parties.
(b) The Management Committee shall consist of four individuals
(each, a "Manager"). DRI shall be entitled to appoint two Managers to the
Management Committee (each a "Dominion Manager"). CNG shall be entitled to
appoint two Managers to the Management Committee (each a "CNG Manager"). In
addition, each Party shall appoint one or more alternates for each Manager
appointed by it. Each alternate shall have all of the powers of the regular
Manager in the regular Manager's absence, declination or inability to serve from
time to time. Notwithstanding the foregoing, each Dominion Manager and
alternative Dominion Manager shall be an employee of Dominion or an Affiliate
thereof when appointed by Dominion and at all times thereafter while serving in
such position, and each CNG Manager and alternate CNG Manager shall be an
employee of CNG or an Affiliate thereof when appointed by CNG and at all times
thereafter while serving in such position.
(c) The Management Committee shall meet at least monthly during
the first year after the date hereof and thereafter, at least quarterly, which
meetings may be held by telephonic conference. Special meetings of the
Management Committee may be called from time to time by any Manager. A quorum
shall consist of at least one DRI Manager and one CNG Manager. In lieu of a
meeting, action of the Management Committee may be taken by the unanimous
written consent of the Managers.
(d) The unanimous approval of the Managers present at a meeting at
which a quorum is present shall be required for the Management Committee to act
or to refrain from acting.
(e) The Management Committee may adopt such rules as the Managers
consider necessary to govern its operations, provided such rules are not
inconsistent with this Agreement.
(d) The Management Committee may designate such officers and other
agents, and may grant such Persons such rights and powers, as the Management
Committee may deem appropriate.
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ARTICLE III
THE SITES
SECTION 3.1 SITE IDENTIFICATION. The Parties have identified those Sites
listed on Exhibit A attached hereto as potential development sites for
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Facilities (the "Existing Sites"). During the term of this Agreement, the
Parties shall seek to identify additional potential Sites for the development of
Facilities. The Management Committee shall establish procedures for identifying
additional potential Sites, including the information needed to assist in such
identification, and each Party shall provide to the other Party such information
which it then has available to it (either directly or through its Affiliates) to
aid in such identification. At such time as the Management Committee identifies
a potential Site, it shall designate such Site in a writing signed by at least
one Manager appointed by each Party, whereupon such Site shall become a
"Development Site". If the Management Committee determines that a Development
Site cannot feasibly be developed for a Facility and the Management Committee
specifies that such Site be deleted from the list of Development Sites, then
such Site shall no longer be deemed a Development Site.
SECTION 3.2 SITE EVALUATION.
(a) The Management Committee shall establish procedures for
evaluating Development Sites and shall seek to prioritize those Development
Sites which appear to have the greatest potential for successful development.
Each Party shall provide to the other Party such information as shall be
necessary or appropriate to assist in the evaluation of Development Sites, to
the extent such information is then available to such Party (either directly or
through its Affiliates).
(b) Except as otherwise decided by the Management Committee, the
Parties will consider the following general criteria for evaluating potential
Development Sites: (i) a nominal 14 percent internal rate of return after tax;
(ii) an emphasis on projects which are generally accretive in their first year
of operations to DRI and CNG; (iii) an equity structure that provides for 50
percent ownership interest by each of DRI and CNG; (iv) an expectation that
projects will be developed with equity funds until the most beneficial long-term
financing structure is in place; (v) an expectation that projects will be
project- or portfolio-financed, as appropriate, to maximize value; (vi) an
expectation that projects will be leveraged to the maximum extent practicable;
(vii) an expectation that tax efficient structures favorable to each Party will
be used to the extent possible; and (viii) such additional or alternative
criteria as the Management Committee deems appropriate with respect to the
Development Site in question.
SECTION 3.3 EMPLOYEES AND CONTRACTORS. Upon the request of the Management
Committee, each Party shall make available to the other Party such employees of
that Party or its Affiliates as shall be necessary and available to assist in
the performance or furtherance of the objectives of this Agreement. To the
extent that qualified employees of the Parties or their Affiliates are not
available for such purposes,
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the Management Committee may hire or authorize the hiring of third party
contractors for the performance of any such activities.
SECTION 3.4 SITE DEVELOPMENT.
(a) If the Management Committee determines that a Development Site
is suitable for development of a Facility, then the Parties shall form a
separate limited liability company or other entity (a "Development Entity") to
pursue such development. The Parties anticipate that each such Development
Entity shall be formed pursuant to an operating agreement (or other appropriate
formation documents) to be mutually agreed upon between the Parties as and when
needed. CNG or its Affiliates and DRI or its Affiliates shall each own 50
percent of the equity interests in any such development or Development Entity.
In addition, each of CNG and DRI acknowledges and agrees that it will cause the
appropriate level of mutually agreeable equity support to be provided to the
Affiliate of such Party that owns the interest in the Development Entity.
(b) During the term of this Agreement, (i) except for development
that is conducted by the Parties pursuant to this Agreement, neither Party shall
develop (either directly or through its Affiliates) any Facility within a
Development Area, or acquire any interest in any Facility in a Development Area,
or, if a Development Site is owned or leased by a Party or its Affiliates, sell
or lease (either directly or through its Affiliates) to another Person such
Development Site and (ii) the Parties, acting pursuant to this Agreement, shall
have the exclusive right to develop any Facility within the Development Areas.
The terms of this Section 3.4(b) shall survive any termination of this
Agreement.
ARTICLE IV
EXPENSES
Except as set forth in the following sentence, each Party shall bear all
expenses incurred by it in connection with this Agreement and the investigation
and evaluation of Development Sites pursuant to this Agreement. All third party
costs incurred by either Party on behalf of the alliance contemplated hereby or
in connection with this Agreement which have been approved by the Management
Committee shall be borne equally by the Parties.
ARTICLE V
CONFIDENTIALITY
SECTION 5.1 CONFIDENTIALITY.
(a) "Confidential Information" means any and all plans,
information, processes, procedures, trade secrets, compositions, improvements,
devices, programs, know-how, inventions, discoveries, concepts and designs,
information regarding business operations, plans and strategies, products or
services, data, marketing and distribution plans, site locations, methods and
techniques and all other information and other materials whether written or oral
(whatever the form or storage medium) provided by a
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Party to the other Party or its Representatives and any analyses, compilations,
studies or other documents prepared by either Party or its Affiliates or their
respective Representatives which contain or otherwise reflect such information.
"Confidential Information" does not include information which: (i) is or was
already in a Party's possession prior to contacts with the other Party; (ii) is
or becomes generally available to the public other than as a result of a
disclosure by a Party or its Representatives (other than the Party whose
information is at issue); or (iii) becomes available to a Party or its
Representatives on a non-confidential basis from a source other than the other
Party or its Representatives; provided that such source is not known to be bound
by a confidentiality agreement or other obligation of secrecy with respect to
such information.
(b) To maintain the confidentiality of the Confidential Information, each
Party, for itself and its Representatives with access to Confidential
Information, agrees, during the period from the date hereof until the second
anniversary of the termination of this Agreement: (i) not to use any
Confidential Information supplied by the other Party, or any copies, extracts,
notes, analyses, summaries, or other material prepared by them or their
Representatives based upon the Confidential Information supplied by the other
Party (collectively, "Notes") except for the purpose of identifying, evaluating
or developing a Development Site as contemplated by this Agreement; (ii) not to
disclose any Confidential Information supplied by the other Party or its
Representatives or Notes other than to their Representatives with a need to know
the information contained therein for the purpose of assisting its
identification, evaluation or development of a Development Site; provided, that
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such Representatives shall have agreed to be bound by the terms of this
Agreement and each Party shall be responsible for a breach of this agreement by
its Representatives; and (iii) not to disclose the terms of this Agreement, that
Confidential Information has been made available, that it or its Representatives
have inspected any Confidential Information, or that it has identified a
Development Site or is evaluating or planning to develop such Development Site
or has had, is having or proposes to have any discussions with respect thereto;
provided that (i) such disclosure may be made if required, in the written
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opinion of counsel to a Party, by applicable law or rule of a stock exchange on
which a Party's shares are listed if in the event of any such required
disclosure the Party shall, prior to such disclosure being made, notify the
other Party and in good faith seek to agree upon the form and content thereof,
and (ii) nothing contained herein shall prohibit a Party from using Confidential
Information solely provided or developed by it or its Representatives in any
manner or for any purpose such Party desires.
ARTICLE VI
ASSIGNMENT
No Party may assign, sell, give, exchange, pledge, encumber or otherwise
transfer (including, without limitation, transfers upon dissolution,
reorganization or merger), whether voluntary or involuntary, any interest in
this Agreement, without the consent of the other Party, which consent may be
withheld in the sole and absolute discretion of such other Party.
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ARTICLE VII
DISPUTE RESOLUTION
SECTION 7.1 DEADLOCK.
(a) If the Parties disagree with respect to the identification,
evaluation or development of a Development Site or with respect to any other
matter that is material to the operation, financial success, capital
requirements or liability of the alliance activities, and if such disagreement
is not otherwise resolved within a period of thirty (30) days, then either Party
may declare a "material deadlock," which declaration shall be given in writing
to the other Party.
(b) Upon declaration of a material deadlock in accordance with
Section 7.1(a), DRI and CNG shall each cause one or more of their respective
senior executive officers to negotiate in good faith with the designated senior
executive officers of the other in an effort to resolve the dispute within the
next sixty (60) days (the "Resolution Period").
SECTION 7.2 TERMINATION NOTICE. If the Parties are unable to resolve the
dispute within the Resolution Period in accordance with the provisions of
Section 7.1(b), either Party (the "Terminating Party") may initiate the
termination procedures of this Agreement by delivering a written notice (the
"Termination Notice") to the other Party (the "Receiving Party") within thirty
(30) days after the end of the Resolution Period requesting the termination of
this Agreement. The Termination Notice shall specify the applicable
"Termination Price" (as defined below) and a date on which the termination shall
occur (the "Termination Date"), which date shall be not less than 60 nor more
than 180 days after the date on which the Termination Notice is received by the
Receiving Party (the "Receipt Date"). If the Receipt Date does not occur within
thirty (30) days following the end of the Resolution Period, then this Agreement
shall continue in full force and effect.
Notwithstanding anything to the contrary contained herein, if prior to the
second anniversary of the date of this Agreement (i) a Transfer of Control
occurs with respect to a Party (or in the case of CNG, with respect to either
CNG or Consolidated Natural Gas Company) or (ii) a written agreement (a
"Transfer Agreement") is entered into pursuant to which a Transfer of Control
would occur with respect to a Party (or in the case of CNG, with respect to
either CNG or Consolidated Natural Gas Company) upon the consummation of such
agreement, then, in either such case, such Party shall be deemed to have given a
Termination Notice and the Receipt Date shall be deemed to have occurred as of
the earlier of the date on which such Transfer of Control occurs or the date on
which the Receiving Party receives notice or has knowledge that a Transfer
Agreement has been executed; provided, however, the provisions of this paragraph
shall not be applicable to, and no Termination Notice shall be deemed given upon
the occurrence of, a Transfer of Control arising from a merger of Consolidated
Natural Gas Company and DRI or their Affiliates.
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SECTION 7.3 TERMINATION PRIOR TO SECOND ANNIVERSARY. If the Receipt Date
occurs or is deemed to occur before the second anniversary of the date of this
Agreement, then the Termination Price shall be an amount equal to all
unreimbursed expenses incurred by the Terminating Party in connection with this
Agreement, from the date hereof to the date on which the Receipt Date occurs.
The Terminating Party shall deliver to the Receiving Party, together with the
Termination Notice, such documentation as shall be reasonably necessary to
substantiate the calculation of such Termination Price; provided, however, that
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if the Termination Notice is deemed given in accordance with the last sentence
of Section 7.2 hereof, then the Receiving Party shall make its best estimate of
the Termination Price, which shall be subject to verification by the Terminating
Party.
The Receiving Party shall have the right to terminate this Agreement by
written notice delivered to the Terminating Party (the "Acceptance Notice")
within sixty (60) days after the Receipt Date. If the Receiving Party does not
give the Acceptance Notice within such sixty (60) day period or if the Receiving
Party specifies in such Acceptance Notice that it elects not to purchase the
Terminating Party's interest in this Agreement (a "No Purchase Termination"),
then this Agreement shall terminate on the Termination Date, at which time all
Alliance Information and all development rights provided by a Party shall first
be distributed to such Party, the alliance shall then be dissolved and all
assets and liabilities of the Parties incurred in connection with this Agreement
and approved by the Management Committee shall be distributed equally to the
Parties; provided, however, if the Terminating Party is deemed to have given a
Termination Notice pursuant to the last sentence of Section 7.2, and the
Receiving Party fails to give an Acceptance Notice within sixty (60) days after
the Receipt Date or specifies in a timely Acceptance Notice that it elects not
to terminate this Agreement as a result of any such Transfer of Control or
Transfer Agreement, then this Agreement shall continue in full force and effect
as if such deemed Termination Notice was never given.
If the Receiving Party gives the Acceptance Notice within sixty (60) days
after the Receipt Date and specifies therein that it elects to purchase the
Terminating Party's interest in this Agreement (a "Purchase Termination"), then
this Agreement shall terminate on the Termination Date, at which time the
Receiving Party shall pay the Termination Price to the Terminating Party in cash
or by wire transfer and the Terminating Party shall execute and deliver to the
Receiving Party such instruments of conveyance, assignment and transfer as shall
be necessary to transfer to the Receiving Party all of the Termination Party's
right, title and interest in and to this Agreement, all permits, contracts and
development rights associated with the Development Sites, and such other
documents of conveyance as the Receiving Party shall reasonably request to fully
consummate the transactions contemplated in this Section. In the event of a
Purchase Termination under this Section 7.3, then from the Termination Date to
the fifth anniversary of this Agreement, the Receiving Party, by itself or with
partners, shall have the exclusive right (which right shall survive any
termination of this Agreement) to develop all of the Development Sites and any
Facility within any of the Development Areas and neither the Terminating Party
nor its Affiliates nor their respective successors or assigns shall have the
right during such period, by themselves or with others, to develop any Facility
within any Development Area, to acquire an interest in any
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Development Site or in any Facility within a Development Area, or, if the
Terminating Party or its Affiliates already owns an interest in a Development
Site, to sell, lease or otherwise transfer such interest to another Person for
the development of such Site. The Terminating Party shall execute, and shall
cause its Affiliates to execute, from time to time such additional documents as
shall be requested by the Receiving Party to further confirm such exclusive
development rights.
SECTION 7.4 TERMINATION AFTER SECOND ANNIVERSARY.
(a) If the Termination Notice is given after the second
anniversary of this Agreement, then the Termination Notice shall include (i) an
offer on the part of the Terminating Party to terminate this Agreement and to
sell the Terminating Party's entire interest (the "Tendered Interest") in this
Agreement and the Development Sites and (ii) the price and terms on which the
Terminating Party will sell the Tendered Interest; provided, however, in no
event shall such terms provide for a closing within less than 120 nor more than
180 days after the Receipt Date or terms and conditions which differ materially
from those typical for the purchase of a 50 percent ownership interest in an
ongoing partnership. Within sixty (60) days after the Receipt Date, the
Receiving Party shall give a written notice (the "Response") to the Terminating
Party stating whether the Receiving Party elects to purchase the Tendered
Interest on the terms and conditions set forth in the Termination Notice.
(b) If the Receiving Party does not elect within such sixty (60)
days after the Receipt Date to purchase the Tendered Interest on the terms set
forth in the Termination Notice, then the Receiving Party shall be required to
sell, and the Terminating Party shall be required to purchase, all of the
Receiving Party's interest in this Agreement and the Development Sites on the
same terms and conditions as were set forth in the Termination Notice with
respect to the Terminating Party's Tendered Interest.
(c) The election made in the Response shall be binding on all
Parties. If there is no Response given within the time specified above, the
Receiving Party shall be deemed to have agreed to sell to the Terminating Party
as provided in Section 7.4(b) all of the Receiving Party's interests in this
Agreement and the Development Sites.
7.5 CLOSING AND DEFAULT. The purchase and sale of a Party's interests
pursuant to Section 7.3 and Section 7.4 shall be closed at the principal office
of the Party purchasing such interests on the date specified in the Termination
Notice (provided, however, if no closing date is specified in the Termination
Notice, then the closing shall occur 180 days after the Receipt Date). The
seller of such Party's interests shall convey such interests at the closing free
and clear of all liens, security interests and encumbrances.
7.6 EFFECT ON ONGOING PROJECTS. No termination of this Agreement pursuant
to this Article 7 shall effect a termination or sale of any development projects
or site development plans as to which the Parties have formed a Development
Entity pursuant to Section 3.4(a) hereof. Except as set forth in the charter
documents of such Development
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Entity, such Development Entity and the Parties rights, obligations and
ownership therein and thereunder shall continue to the same extent and manner as
set forth in such charter documents.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
SECTION 8.1 REPRESENTATIONS AND WARRANTIES OF CNG. CNG hereby makes the
following representations and warranties to DRI:
(a) CNG is a Delaware corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, is qualified to do
business in those states where the nature of its business requires it to be so
qualified and has the legal power and authority to own its properties, to carry
on its business as now being conducted, to enter into this Agreement, to carry
out the transactions contemplated hereby and to perform and carry out all
covenants and obligations on its part to be performed under and pursuant to this
Agreement.
(b) The execution, delivery and performance by CNG of this
Agreement have been duly authorized by all necessary corporate action, and do
not and will not require any consent or approval of CNG's board of directors or
shareholders other than that which has been obtained.
(c) The execution and delivery of this Agreement, the consummation
of the transactions contemplated hereby and the fulfillment of and compliance
with the provisions of this Agreement, do not and will not conflict with or
constitute a breach of or a default under, any of the terms, conditions or
provisions of any legal requirements, or any organizational documents,
agreement, deed of trust, mortgage, loan agreement, other evidence of
indebtedness or any other agreement or instrument to which CNG is a party or by
which it or any of its property is bound, or result in a breach of or a default
under any of the foregoing, and CNG has obtained all permits, licenses,
approvals and consents of governmental authorities required for the execution
and delivery of this Agreement.
(d) This Agreement constitutes the legal, valid and binding
obligation of CNG enforceable in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws relating to or affecting the enforcement of creditors' rights
generally or by general equitable principles, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
(e) There is no pending, or to the knowledge of CNG, threatened
action or proceeding affecting CNG before any governmental authority which
purports to affect the legality, validity or enforceability of this Agreement.
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SECTION 8.2 REPRESENTATIONS AND WARRANTIES OF DRI. DRI hereby makes the
following representations and warranties to CNG:
(a) DRI is a Virginia corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of Virginia, is
qualified to do business in those states where the nature of its business
requires it to be so qualified and has the legal power and authority to own its
properties, to carry on its business as now being conducted, to enter into this
Agreement, to carry out the transactions contemplated hereby and to perform and
carry out all covenants and obligations on its part to be performed under and
pursuant to this Agreement.
(b) The execution, delivery and performance by DRI of this
Agreement have been duly authorized by all necessary corporate action, and do
not and will not require any consent or approval of DRI's board of directors or
shareholders other than that which has been obtained.
(c) The execution and delivery of this Agreement, the consummation
of the transactions contemplated hereby and the fulfillment of and compliance
with the provisions of this Agreement, do not and will not conflict with or
constitute a breach of or a default under, any of the terms, conditions or
provisions of any legal requirements, or any organizational documents,
agreement, deed of trust, mortgage, loan agreement, other evidence of
indebtedness or any other agreement or instrument to which DRI is a party or by
which it or any of its property is bound, or result in a breach of or a default
under any of the foregoing, and DRI has obtained all permits, licenses,
approvals and consents of governmental authorities required for the execution
and delivery of this Agreement.
(d) This Agreement constitutes the legal, valid and binding
obligation of DRI enforceable in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws relating to or affecting the enforcement of creditors' rights
generally or by general equitable principles, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
(e) There is no pending, or to the knowledge of DRI, threatened
action or proceeding affecting DRI before any governmental authority which
purports to affect the legality, validity or enforceability of this Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 TERM. The term of this Agreement shall commence on the date
of this Agreement and shall terminate on the fifth anniversary of such date.
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SECTION 9.2 NOTICES. Notices and communications given pursuant to this
Agreement (including Termination Notices, Acceptance Notices and Responses)
shall be in writing and shall be delivered by hand, telefax, commercial courier
or registered or certified mail (return receipt requested and postage prepaid),
to the following addresses (or at such other address for a party as shall be
specified by like notice):
If to DRI:
Xxxxx X. Xxxxxx
Vice President and General Counsel
Dominion Resources, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
with a copy to:
Xxxxxxx X. Xxxxxxx
McGuire, Woods, Battle & Xxxxxx, LLP
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
If to CNG:
Xxxxxxx X. Xxxxxxxx
Senior Vice President and General Counsel
Consolidated Natural Gas Company
CNG Tower
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
with a copy to:
Xxxx Xxxxxxxx
Senior Counsel
Consolidated Natural Gas Company
CNG Tower
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Fax (000) 000-0000
All such notices shall be deemed to be effective when received or, if acceptance
of delivery is refused, upon tender of delivery. Notices given by telecopy
shall be followed by a copy of the notice given by overnight courier service.
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SECTION 9.3 AMENDMENT. This Agreement may be amended only in a writing
evidenced by the consent of all of the Parties.
SECTION 9.4 INVALIDITY. If any provision of this Agreement shall be held
invalid, the same shall not affect in any respect whatsoever the validity of the
remainder of this Agreement.
SECTION 9.5 BINDING EFFECT. This Agreement shall be binding upon, and
shall inure to the benefit of, the Parties hereto and their respective
successors and assigns.
SECTION 9.6 PRESS RELEASES. Neither DRI nor CNG shall make any press
release or public statement about the Agreement or the transactions contemplated
hereby until each party has approved the timing and content of such press
release.
SECTION 9.7 RELATIONSHIP OF PARTIES. It is understood and agreed that the
relationship of the Parties is limited to that specifically contained herein.
Neither DRI nor CNG nor any of their respective Affiliates, employees or agents
shall be construed to be the agent, employee or representative of the other,
except as provided in Section 2.4 hereof, and neither Party has the authority to
bind the other or to incur any obligation on its behalf. As between the Parties,
nothing in this Agreement shall be deemed to constitute any such Party a partner
or joint venturer of any other Party or to create a fiduciary relationship
between such Parties.
SECTION 9.8 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which, when taken together,
shall constitute one and the same instrument.
SECTION 9.9 FURTHER ASSURANCES. The Parties agree that they will
cooperate with each other and will execute and deliver, or cause to be
delivered, all such other instruments, and will take such other actions, as any
Party hereto may reasonably request from time to time in order to effectuate the
provisions and purposes hereof.
SECTION 9.10 COMPLETE AGREEMENT. This Agreement constitutes the complete
and exclusive statement of the agreement among the Parties with respect to the
alliance and the parties rights and obligations regarding the Development Sites.
It supersedes all prior agreements.
SECTION 9.11 DEFAULT; EXPENSES OF LITIGATION. If a Party defaults in the
performance of its obligations hereunder (including a default by such Party
(either directly or through its Affiliates) of the exclusivity provisions
hereof), then the non-defaulting Party shall be entitled to all remedies
available at law or equity (including specific performance and injunctive
relief). If either Party commences litigation to enforce the terms of this
Agreement, then the prevailing Party in such litigation shall be entitled to
recover from the other Party all legal fees and expenses incurred by the
prevailing Party in connection therewith.
14
SECTION 9.12 GOVERNING LAW, JURISDICTION. This Agreement shall be
governed by the laws of the State of New York, without giving effect to its
choice of laws rules. Furthermore, each Party agrees to subject itself to the
jurisdiction of the courts of the State of New York and has designated an agent
for service of process.
SECTION 9.13 GUARANTY OF CONSOLIDATED NATURAL GAS COMPANY. Within 5
business days of the date hereof, CNG shall cause Consolidated Natural Gas
Company to deliver to DRI a guaranty supporting performance of all of CNG's
obligations under this Agreement. Such guaranty shall be acceptable in form and
substance to DRI in its reasonable discretion.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
15
WITNESS the following signatures.
CNG POWER COMPANY
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President and General Manager
DOMINION RESOURCES, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President
16
EXHIBIT A
--------------------------------------------------------------------------------------------------------------
STATE, SITE NAME OF SITE UTILITY CONNECTION COMMENTS
NUMBER LATITUDE & LONGITUDE
------------------------------------
Transmission Interface Point
--------------------------------------------------------------------------------------------------------------
OH-1 Xxxxxx County CG&E, CSP(AEP), Non-attainment area, put back on
DP&L [Joint list at request of market team
------------------------------------
ownership line] 345 Kv line between Fostor and
Xxxxxx Substations
--------------------------------------------------------------------------------------------------------------
OH-2 Clinton County CG&E, CSP(AEP), Possible access to Cinergy via
39d31m long, 83d53m lat DP&L [Joint joint ownership line (56 percent
ownership line] loaded line)
345 Kv line between Clinton and
Xxxxxx Substations
--------------------------------------------------------------------------------------------------------------
OH-2a Washington Compressor Dayton P&L or AEP Electric transmission is an issue,
Station/ Fayette County CNG owns 60 acres
--------------------------------------------------------------------------------------------------------------
OH-3 Pickaway County, west CG&E, CSP(AEP), OH Commission likes, possible
39d42m39.1s long, DP&L [Joint access to Cinergy
------------------------------------
83d10m38.4s lat ownership line] 345Kv tie line between Stuart and
Xxxxxx substations
--------------------------------------------------------------------------------------------------------------
OH-4 Pickaway County, east CG&E, CSP(AEP), OH Commission likes, possible line
39d45m38s long 82d59m20s DP&L [Joint to Cinergy
------------------------------------
lat ownership line] 345KV line between Marquis and
Xxxxx substations
--------------------------------------------------------------------------------------------------------------
OH-4a Groveport Compressor Dayton P&L or AEP CNG owns 20 acres, on 138KV line,
Station/Fairfield County in flood plain
--------------------------------------------------------------------------------------------------------------
XX-0 Xxxxxxxxx Xxxxxx, xxxx Xxxxxx X&X or AEP Inside AEP, access to joint
ownership line
--------------------------------------------------------------------------------------------------------------
XX-0 Xxxxxxxxx Xxxxxx, xxxx Xxxxxx X&X or AEP Inside AEP, access to joint
ownership line
--------------------------------------------------------------------------------------------------------------
OH-7 Newark Compressor AEP CNG owns 89 acres, access to joint
Station/Licking County ownership line, arch. site on
property
--------------------------------------------------------------------------------------------------------------
OH-8 Muskingum County AEP In AEP
--------------------------------------------------------------------------------------------------------------
OH-9 Coshocton County AEP In AEP, non-attainment for SO2
--------------------------------------------------------------------------------------------------------------
OH-9a Xxxxxxx Compressor AEP 138KV transmission
Station/Tuscarawas
--------------------------------------------------------------------------------------------------------------
OH-10 Xxxxxxx Compressor AEP CNG owns 101 acres, inside AEP,
Station, Xxxxxxx County 765Kv line
--------------------------------------------------------------------------------------------------------------
OH-11 Xxxxxxx County, east First Energy Possible non-attainment for SO2
and PM10
------------------------------------
345Kv line between Xxxxxx and
South Canton substations
--------------------------------------------------------------------------------------------------------------
17
--------------------------------------------------------------------------------------------------------------
STATE, SITE NAME OF SITE UTILITY CONNECTION COMMENTS
NUMBER LATITUDE & LONGITUDE
------------------------------------
Transmission Interface Point
--------------------------------------------------------------------------------------------------------------
OH-12 Jefferson County Ohio Edison Non-attainment for SO2 & PM10
--------------------------------------------------------------------------------------------------------------
OH-13 Columbiana County, First Energy Ohio Commission likes
------------------------------------
west 345Kv line between Xxxxxx and
Highland substations
--------------------------------------------------------------------------------------------------------------
OH-14 Columbiana County, central Duquesne/First Ohio Commission likes
Energy or First
------------------------------------
Energy 345Kv tie line between Beaver
Valley and Xxxxx substations or
345 KV line between Mansfield and
Champerlain substations
--------------------------------------------------------------------------------------------------------------
OH-15 Columbiana County, east First Energy Ohio Commission likes
40d47m long,
------------------------------------
80d32m30s lat 345Kv line between Mansfield and
Highland substations
--------------------------------------------------------------------------------------------------------------
OH-16 Orrville Site, Xxxxx AEP 138KV transmission, gas issues
County
--------------------------------------------------------------------------------------------------------------
OH-17 WCI Steel Site, Trumball Possible cogen, DE will
County investigate
--------------------------------------------------------------------------------------------------------------
OH-18 Wood County Toledo Edision/First CNG owns 500 acres, access
Energy through LDC
--------------------------------------------------------------------------------------------------------------
18
------------------------------------------------------------------------------------------------------------
STATE, SITE NUMBER NAME OF SITE UTILITY CONNECTION COMMENTS
LATITUDE & LONGITUDE
--------------------------------------
Transmission Interface Point
------------------------------------------------------------------------------------------------------------
PA-1 Xxxxxx County Allegheny
--------------------------------------
39d47m14s long, 80d24m46s 500KV line between Xxxxxx and Ft.
lat Xxxxxx substations or the 500Kv
line between the Xxxxxxxx or Xxxxx
Xxxxx substations
------------------------------------------------------------------------------------------------------------
PA-2 South Bend Facility/ Allegheny/PJM or PJM On border w/ PJM, near Keystone
Indiana County Station, CNG owns 100 acres
--------------------------------------
40d40m long, 79d21m lat 500Kv tie line between the Keystone
and Yukon substations or the 500Kv
line between the Keystone and
Conemaugh substations
------------------------------------------------------------------------------------------------------------
PA-3 Jefferson County Penn Electric
------------------------------------------------------------------------------------------------------------
PA-4 Clearfield County Penn Electric Environmental Issues
------------------------------------------------------------------------------------------------------------
PA-5 Elk County Allegheny
------------------------------------------------------------------------------------------------------------
XX-0 XxXxxx Xxxxxx Xxxxxxxxx
------------------------------------------------------------------------------------------------------------
XX-0 Xxxxxx Xxxxxx Allegheny
------------------------------------------------------------------------------------------------------------
PA-8 Tioga County Penn Electric Transmission may be an issue
------------------------------------------------------------------------------------------------------------
PA-9 Beaver Compressor Dusquense Non-attainment 03, CO, SO2, PM-10;
Station//Beaver County CNG owns 300 acres
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
Note: All PA. Will be non
attainment for ozone, market in PJM
west is not attractive
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------
19
------------------------------------------------------------------------------------------------------
STATE, SITE NAME OF SITE UTILITY CONNECTION COMMENTS
NUMBER LATITUDE & LONGITUDE
---------------------------------
Transmission Interface Point
------------------------------------------------------------------------------------------------------
WV-1 Xxxxxxxxx County Allegheny or Possible interface site between
Allegheny to AEP AEP and Allegheny, 500Kv line
---------------------------------
interface 500 Kv line between the Belmont
and Xxxxxxxx substations or the
500 Kv tie line at the Belmont
substation
------------------------------------------------------------------------------------------------------
WV-2 Xxxxxxxx/Xxxxxx County AEP
------------------------------------------------------------------------------------------------------
WV-3 Xxxxxxxx County AEP
------------------------------------------------------------------------------------------------------
WV-4 Doddridge/Tyler County Allegheny 500Kv transmission, gas
constraints
---------------------------------
500Kv line between the Belmont
and Xxxxxxxx substations
------------------------------------------------------------------------------------------------------
WV-5 Doddridge County Allegheny 500Kv transmission, gas
constraints
---------------------------------
500Kv line between the Belmont
and Xxxxxxxx substations
------------------------------------------------------------------------------------------------------
WV-6 Xxxxxxxx County Allegheny
------------------------------------------------------------------------------------------------------
WV-7 Xxxxxx County Allegheny Gas constraints
------------------------------------------------------------------------------------------------------
WV-8 Xxxxxx/Preston County Allegheny Gas Constraints plus close to
Class 1 area
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
20
------------------------------------------------------------------------------------------------------
STATE, SITE NAME OF SITE UTILITY CONNECTION COMMENTS
NUMBER LATITUDE & LONGITUDE
---------------------------------
Transmission Interface Point
------------------------------------------------------------------------------------------------------
NY-1 Xxxxxxxxxx County Niagara Mohawk West of constraint
---------------------------------
42d54m long 345Kv line between Scotland and
74d18m lat Edic substations or 345 Kv (built
to 765) line between Scotland and
Xxxxx substations
------------------------------------------------------------------------------------------------------
NY-2 Schenectady County Niagara Mohawk West of constraint
---------------------------------
42d50m long 230 Kv line between Xxxxxx and
74d3m lat Rotterdam substations
------------------------------------------------------------------------------------------------------
NY-3 Albany County Niagara Mohawk West of constraint
---------------------------------
42d45m long 345Kv line between Scotland and
74d07m30s lat Edic substations or 345 Kv (built
to 765) line between Scotland and
Xxxxx substations
------------------------------------------------------------------------------------------------------
NY-4 Rensselear County, Niagara Mohawk or NY
north 42d41m long State Electric & Gas
---------------------------------
73d42m30s lat 345Kv line between Alps and
Xxxxxxxx substations
------------------------------------------------------------------------------------------------------
NY-5 Rensselear County, Niagara Mohawk or NY
south 42d41m long State Electric & Gas
---------------------------------
73d42m30s lat 345 Kv line between Alps and
Scotland substations
------------------------------------------------------------------------------------------------------
NY-6 Rochester Rochester Gas & Elec. DE will investigate
Or Niagara Mohawk
---------------------------------
Later
------------------------------------------------------------------------------------------------------
NY-7 Utica West of transmission constraint
------------------------------------------------------------------------------------------------------
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