1
Exhibit 10.28
AGREEMENT
Agreement, dated as of __________, 2000, between Orion Power Holdings,
Inc., a Delaware corporation (the "Company"), and the parties listed in Appendix
A hereto (collectively, the "Shareholders").
WITNESSETH:
WHEREAS, the Company is engaged in the acquisition, development, ownership
and operation of electric power generation facilities throughout the United
States;
WHEREAS, each of the Shareholders currently owns and, upon completion of
the Company's initial public offering of its common stock, will continue to own
more than 5% of the outstanding voting securities of the Company; and
WHEREAS, the Company and the Shareholders wish to set forth their
agreement regarding the manner in which the Company will restructure the
Shareholders' interests in the Company to minimize the regulatory consequences
of (1) an acquisition by the Company of the voting securities of a "public
utility company," a "holding company," or any other entity, (2) an acquisition
by the Company of assets, or (3) any other action taken by the Company that
would cause the Shareholders or their parent and its Affiliates (together with
the Shareholders, the "Shareholder Entities") solely by virtue of their
ownership of interests in the Company to be deemed an "affiliate," a "subsidiary
company" or a "holding company" (as each such term is defined in the Public
Utility Holding Company Act of 1935, as amended ("PUHCA")), or to cause any of
the Shareholder Entities to become subject to regulation under PUHCA or the
Federal Power Act, as amended (the "FPA") (such action hereinafter referred to
as a "PUHCA Transaction").
NOW, THEREFORE, in consideration of these premises and for other valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the
Company and the Shareholders do hereby agree as follows:
Section 1. Definitions: The following terms, when used herein, shall
have the meanings specified below:
(a) "Affiliate" shall mean, when used with respect to a specified Person,
another Person that directly or indirectly controls or is controlled by or is
under common control with the Person specified. For this purpose, "control" of a
Person shall mean the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of such Person, whether
through ownership of voting shares, by contract or otherwise.
(b) "Controlling Influence" shall mean a "controlling influence" (within
the meaning of PUHCA) that would cause any of the Shareholder Entities to be
deemed any of an "affiliate," a "subsidiary company" or a "holding company"
under PUHCA or subject to regulation under PUHCA.
2
(c) "Person" shall mean any natural person, corporation, limited liability
company, business trust, joint venture, association, company, partnership or
other entity.
(d) "Statutory Threshold" shall mean the ownership percentage of
outstanding voting securities provided in PUHCA, or any successor statute of
similar import, or the FPA, or any successor statute of similar import, that
would deem a Person to be an "affiliate," a "subsidiary company" or a "holding
company" (as each such term is defined in PUHCA), or to cause a Person to be
subject to regulation under PUHCA or the FPA (it being understood that as of
October 2000, the Statutory Threshold under PUHCA is equal to five percent (5%)
of the outstanding voting securities of the Company).
Section 2. Agreement. The Company and the Shareholders agree that for so
long as the Shareholder Entities own a percentage of the outstanding voting
stock of the Company that is not less than the Statutory Threshold, if the
Company wishes to engage in a PUHCA Transaction that has been duly approved by
the Board of Directors, then, upon at least 60 days written notice from the
Company to the Shareholder Entities, the Company shall convert into non-voting
stock (the "Non-Voting Stock"), on a one-to-one basis, the number of shares of
outstanding voting stock of the Company owned by the Shareholder Entities at the
end of the 60 day period necessary to ensure that they will avoid becoming an
"affiliate," a "subsidiary company" or a "holding company" under PUHCA or
subject to regulation under PUHCA. The Shareholder Entities will be entitled
without delay to convert their shares of Non-Voting Stock into an equal number
of shares of voting common stock at any time and in the Shareholder Entities'
sole and absolute discretion. In the event that a Shareholder Entity's share
ownership (including voting and Non-Voting Stock) in the Company falls below the
Statutory Threshold, all shares of Non-Voting Stock held by such Shareholder
Entity shall automatically convert back to voting common stock and this
Agreement shall terminate with respect to such Shareholder Entity.
Section 3. Timing. The conversion of the Shareholder Entities'
outstanding voting stock into Non-Voting Stock shall occur immediately prior
to the closing of the PUHCA Transaction.
Section 4. Expense. The conversion of the Shareholder Entities'
outstanding voting stock into Non-Voting Stock and the conversion of the
Shareholder Entities' Non-Voting Stock back into voting stock shall be
accomplished at the sole expense of the Company.
Section 5. Notices. Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed or sent by telecopy as follows:
(i) if to the Company, to: Xxxx Xxxxxx, General Counsel, Orion
Power Holdings, Inc., 0 Xxxx Xxxxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxxxx, XX 00000, XXX, Facsimile: 0-000-000-0000;
(ii) if to any of the Mitsubishi Entities, to: Mitsubishi
Corporation, 0-0 Xxxxxxxxxx 0-xxxxx, Xxxxxxx-xx, Xxxxx
000-0000, Xxxxx, Facsimile: 00-0-0000-0000, Attention:
MC/TOK (MD-B); and,
3
(iii) if to TEPCO, to: Tokyo Electric Power Company
International B.V., c/o The Tokyo Electric Power Co., Inc.,
0-0 Xxxxxxxxxx-xxx 0-xxxxx Xxxxxxx-xx, Xxxxx 000-0000,
Xxxxx, Facsimile: 00-0-0000-0000, Attention: Business
Development Group International Affairs Department.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy to such party as provided in this Section 5.
Section 6. Successors and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party; and all covenants, promises and agreements
by or on behalf of any party that are contained in this Agreement shall bind and
inure to the benefit of its successors and assigns. Notwithstanding this Section
6, the Shareholders may not assign this Agreement without the written consent of
the Company, such consent not to be unreasonably withheld, unless such
assignment is to an Affiliate of the Shareholder.
Section 7. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO CONFLICT OF LAW PROVISIONS.
Section 8. Severability. In the event any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby.
Section 9. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original but all of
which when taken together shall constitute but one contract.
Section 10. Headings. Section headings used herein are for
convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in
interpreting, this Agreement.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
ORION POWER HOLDINGS, INC.
By:__________________________
Name:
Title:
DIAMOND GENERATING CORPORATION DIAMOND CAYMAN, INC.
By:__________________________
Name: By:__________________________
Title: Name:
Title:
MITSUBISHI INTERNATIONAL TOKYO ELECTRIC POWER COMPANY
CORPORATION INTERNATIONAL B.V.
By:__________________________
Name: By:__________________________
Title: Name:
Title:
5
APPENDIX A
DIAMOND GENERATING CORPORATION
DIAMOND CAYMAN, INC.
MITSUBISHI INTERNATIONAL CORPORATION
TOKYO ELECTRIC POWER COMPANY INTERNATIONAL B.V.
