Exhibit 2.1
Execution Version
AMENDMENT NO. 2 TO THE MASTER PUT
OPTION
AND MEMBERSHIP INTEREST PURCHASE AGREEMENT
This AMENDMENT NO. 2 TO THE MASTER
PUT OPTION AND MEMBERSHIP INTEREST PURCHASE AGREEMENT (this “
Amendment ”) is entered into as of September 21,
2009, by and among Constellation Energy Group, Inc., a
corporation organized under the laws of the State of Maryland
(“ Seller’s Parent ”), Constellation
Nuclear, LLC, a Delaware limited liability company that is a
wholly-owned subsidiary of Seller’s Parent (“
Seller ”), EDF Development Inc., a corporation
organized under the laws of the State of Delaware (“
Purchaser ”), E.D.F. International S.A., a
société anonyme organized under the laws of France
and the parent company of Purchaser (“ Purchaser’s
Parent ”), and Constellation Energy Nuclear Group, LLC, a
limited liability company organized under the laws of the State of
Maryland (the “ Company ”).
W I T N E S
S E T H :
WHEREAS, Seller’s Parent,
Purchaser, Purchaser’s Parent and the Company (collectively,
the “ Original Parties ”) entered into a Master
Put Option and Membership Interest Purchase Agreement dated as of
December 17, 2008 (the “ Master Agreement
”);
WHEREAS, the Original Parties have
agreed to the structure of a Revised Transaction, as contemplated
by Section 1.6 of the Master Agreement, the terms of which are
memorialized in this Amendment;
WHEREAS, the Original Parties have
reached agreement to revise the structure of the sale of the
Designated Interest in accordance with Section 1.6 of the
Master Agreement to achieve improved economic efficiencies for the
Original Parties as a result of completing the sale of the
Designated Interest and subsequently owning and operating the
Company;
WHEREAS, in connection with
implementing such agreed structural changes, the Original Parties
desire to add Constellation Nuclear, LLC as a party to the Master
Agreement, and in connection therewith make such other changes as
are necessary and otherwise agreed to reflect Constellation
Nuclear, LLC as the Seller;
WHEREAS, as the result of further
discussions, the Original Parties have agreed to make certain
additional changes to the Master Agreement, and certain exhibits
thereto, to reflect additional agreements and understandings
reached after December 17, 2008;
WHEREAS, Section 9.9 of the
Master Agreement permits amendments to the Master Agreement if
signed in writing by the Original Parties; and
WHEREAS, the Original Parties desire
to amend the Master Agreement as provided in this
Amendment.
AGREEMENT:
NOW, THEREFORE, in consideration of
the promises and the mutual representations, warranties, covenants,
agreements and conditions herein contained, and for
other
good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto,
intending to be legally bound, hereby agree as follows:
Section 1.
Defined
Terms . Capitalized terms
used in this Amendment without separate definition shall have the
respective meanings assigned to them in the Master
Agreement.
Section 2.
Amendment to
Preamble . Seller hereby agrees
that upon execution of this Amendment it shall become a party to
the Agreement and shall be fully bound by, and subject to, all of
the covenants, terms and conditions of the Agreement applicable to
the Seller as though an original party thereto.
Notwithstanding anything to the contrary in the Master Agreement,
the term “Seller” shall hereinafter refer to
Constellation Nuclear, LLC, a Delaware limited liability company,
and, except as expressly provided in this Amendment, the term
“Party” and “Parties” as used in the Master
Agreement are hereby amended to also include Seller’s
Parent.
Section 3.
Amendment to
Recitals . The first, second and
third recitals to the Master Agreement are hereby amended and
restated in their entirety to read as follows:
“WHEREAS, as of the date of
this Agreement, Seller’s Parent conducts, exclusively through
the Company and its subsidiaries, a nuclear generation operation
that owns, operates and maintains the nuclear generation facilities
set forth on Exhibit A (the “ Nuclear
Business ”);
WHEREAS, as of December 17,
2008, Seller’s Parent is the beneficial and record owner of
all of the outstanding membership interests in the Company and,
prior to the Designated Interest Closing, Seller’s Parent
will transfer its membership interests in the Company as specified
in Section 1.6 such that the outstanding membership
interests will be held, beneficially and of record, (i) 99% by
Seller and (ii) 1% by CE Nuclear prior to the Designated
Interest Closing Date;
WHEREAS, Purchaser desires to
acquire directly from the Company newly issued Common Interests
representing [7.44]% of the outstanding membership interests of the
Company immediately after such issuance (the “ New
Designated Interest ”) as specified in
Section 1.6 ;
WHEREAS, Seller desires to sell,
transfer and deliver, and Purchaser desires to purchase, acquire
and assume, all of Seller’s right, title and interest in, to
and under [42.55]% of the outstanding membership interests of the
Company (the “ Transferred Designated Interest ”
and together with the New Designated Interest, the “
Designated Interest ”), all upon the terms and subject
to the conditions set forth in this Agreement;”
Section 4.
Amendment to
Section 1.1 . Section 1.1 of
the Master Agreement is hereby amended and restated in its entirety
to read as follows:
“Upon the terms and subject to
the conditions of this Agreement, at the Designated Interest
Closing, Purchaser agrees to purchase from Seller, and Seller
agrees to sell to Purchaser, the Transferred Designated Interest
for $ [ 3,809,000,000 ] (the “ Purchase
Price ”), as adjusted pursuant to Section 1.4
.”
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Section 5.
Amendment to
Section 1.3 .
Section 1.3(b) of the Master Agreement is hereby amended
and restated in its entirety to read as follows:
“(i) The Company shall
deliver to Purchaser the New Designated Interest to Purchaser, free
and clear of all Encumbrances, which delivery shall be effected by
the Company having entered into and delivered to Purchaser the
Operating Agreement and (ii) Seller shall deliver to Purchaser
a duly and validly executed assignment of membership interests in
the form attached hereto as Exhibit D (the “
Assignment of Membership Interests ”), transferring
ownership of the Transferred Designated Interest to Purchaser, free
and clear of all Encumbrances, and otherwise sufficient to vest in
Purchaser good title to the Transferred Designated
Interest;”
Section 6.
Amendment to
Section 1.3 .
Section 1.3(c) of the Master Agreement is hereby amended
and restated in its entirety to read as follows:
“Seller shall deliver to
Purchaser (i) copies, certified by the Secretary or any
Assistant Secretary of Seller’s Parent, Seller and the
Company, of resolutions of each authorizing the execution and
delivery of this Agreement and all of the Ancillary Documents, and
the consummation of the transactions contemplated hereby and
thereby and (ii) a certificate of good standing with respect
to each of Seller’s Parent, Seller and the Company, issued by
the Department of Assessments and Taxation of the State of
Maryland;”
Section 7.
Amendment to
Section 1.3 .
Section 1.3(e) of the Master Agreement is hereby amended
and restated in its entirety to read as follows:
“the Operating Agreement shall
be duly executed and delivered by each of the Parties and CE
Nuclear (as defined in Section 1.6); and”
Section 8.
Amendment to
Section 1.4 .
Section 1.4(a) of the Master Agreement is hereby amended
by removing the word “and” at the end of clause
(iv) of the first sentence and adding the following clauses at
the end of the first sentence:
“(vi) decreased by
one-half of the estimated Accrued Expenses of the Company and its
Subsidiaries as of the Designated Interest Closing Date, and
(vii) decreased by one-half of the Estimated Pension
Liability.”
Section 9.
Amendment to
Section 1.4 .
Section 1.4(b) of the Master Agreement is hereby amended
by amending restating the first sentence of such subsection as
follows:
“As promptly as practical, but
in no event more than sixty (60) days after the Designated Interest
Closing, Purchaser shall, with the cooperation of the Company,
prepare and deliver to Seller a draft of a statement prepared in
good faith setting forth its calculation of the Final Cash Purchase
Price (the “ Proposed Final Cash Purchase Price
Statement ”) which shall show, as of the Designated
Interest Closing Date, (i) the Purchase Price,
(ii) decreased by $1,000,000,000 plus the actual Accrued
Dividends, (iii) decreased by one-half of the actual
Indebtedness of the Company and its Subsidiaries as of the
Designated Interest Closing Date but not to exceed the Indebtedness
Cap, (iv) increased by one-half
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of the actual amount of Cash and
Cash Equivalents of the Company and its Subsidiaries,
(v) decreased by the actual Bridge Facility Repayment Amount,
if any and (vi) decreased by one-half of the actual Accrued
Expenses of the Company and its Subsidiaries.”
Section 10.
Amendment to
Section 1.4 . Section 1.4 of
the Master Agreement is hereby amended by adding a new subsection
(e) after Section 1.4(d) as follows:
“(e)
As soon as administratively
practicable following the first date on which it is determinable,
Seller’s Parent shall prepare and deliver to Purchaser a
statement setting forth the calculation of the Final Pension
Liability, if any, together with the detailed underlying seriatim
census data and detailed underlying actuarial assumptions.
Purchaser shall have thirty (30) days in which to challenge such
calculation. Purchaser may not challenge the selection and
use of the actuarial assumptions used to calculate the Final
Pension Liability to the extent those assumptions are as set forth
in the definition of Final Pension Liability. If Purchaser
challenges such calculation, any dispute will be resolved by an
independent actuary utilizing procedures consistent with the
dispute resolution procedures in Section 1.4(b) of the
Agreement. If the Final Pension Liability is greater than the
Estimated Pension Liability, Seller’s Parent shall promptly
pay to Purchaser an amount that is equal to one-half of the
difference between the Final Pension Liability and the Estimated
Pension Liability within five (5) Business Days of the
determination of the Final Pension Liability. If the Final
Pension Liability is less than the Estimated Pension Liability,
Purchaser shall pay to Seller’s Parent an amount equal to
one-half of the difference between the Estimated Pension Liability
and the Final Pension Liability (but in no event more than one-half
of the Estimated Pension Liability).”
Section 11.
Amendment to
Section 1.6 . Section 1.6 of
the Master Agreement is hereby amended and restated in its entirety
to read as follows:
“1.6 Transaction
Structure .
(a)
Prior to the
Designated Interest Closing Date, Seller’s Parent, Seller,
and the Company shall cause the following transactions to occur in
the following order:
(i)
Seller will elect
to be classified as a corporation for U.S. federal income tax
purposes;
(ii)
Seller’s
Parent will contribute 100% of the Common Interests to
Seller;
(iii)
the Company will
elect to be treated as disregarded and no longer classified as a
corporation for U.S. federal income tax purposes;
(iv)
Constellation
Nuclear Power Plants, Inc., a corporation organized under the
laws of the State of Delaware (“ CNPP ”), will
convert under Delaware law into a limited liability company that is
a disregarded entity for U.S. federal income tax
purposes;
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(v)
CNPP will
organize Calvert Cliffs Nuclear Power Plant, LLC, a limited
liability company organized under the laws of the State of Delaware
(“ Calvert Cliffs ”), as a wholly-owned
subsidiary of CNPP;
(vi)
Calvert Cliffs
Nuclear Power Plant, Inc., a corporation organized under the
laws of the State of Maryland and an indirect wholly-owned
subsidiary of the Company, will merge with and into Calvert Cliffs
(with Calvert Cliffs surviving);
(vii)
100% of the stock
of Calvert Land Corporation, a corporation organized under the laws
of the State of Maryland and then a direct wholly-owned subsidiary
of Calvert Cliffs, will be distributed (A) by Calvert Cliffs
to CNPP, (B) by CNPP to the Company, and (C) by the
Company to Seller;
(viii)
the Company will
distribute to Seller 100% of its interest in CeTerre, LLC, a
limited liability company organized under the laws of the State of
Delaware held 50% by the Company and 50% by the Purchaser, and 100%
of its interest in Constellation New Nuclear, LLC, a limited
liability company organized under the laws of the State of Delaware
held 91% by the Company and 9% by Calvert Land
Corporation;
(ix)
Seller will
organize CE Nuclear, LLC, a limited liability company organized
under the laws of the State of Delaware (“ CE Nuclear
”), as a direct wholly-owned subsidiary of
Seller;
(x)
CE Nuclear will
elect to be classified as a corporation for U.S. federal income tax
purposes; and
Seller will contribute 1% of the
Common Interests to CE Nuclear in constructive exchange for
additional membership interests in CE Nuclear.
(b)
On the Designated
Interest Closing Date, the following transactions shall occur in
the following order:
(i)
Purchaser will
contribute $ [
670,000,000
] (the “ Contribution
Amount ”) to the capital of the Company by transferring
such amount by wire transfer in immediately available funds to an
account specified in writing by the Company to Purchaser in
exchange for which the Company will issue to Purchaser the New
Designated Interest;
(ii)
Immediately upon
receipt of the amount set forth in clause (i) above, the
Company shall (x) distribute $ [ 379,000,000
] to Seller to reimburse
Seller for certain preformation expenditures and (y) pay
$ [ 291,000,000
] to Seller’s Parent in
repayment of certain liabilities incurred by the Company;
and
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(iii)
Purchaser will
purchase the Transferred Designated Interest from Seller upon the
terms and subject to the conditions of this
Agreement.”
Section 12.
Amendment to
Article 2 . Each reference to
Seller in Article 2 shall be deleted and replaced in each case
with the words “Seller’s Parent”, and any
reference in Article II to the word “Parties”
shall mean Seller’s Parent and Purchaser.
Section 13.
Amendment to
Section 2.2 .
Section 2.2(a) of the Master Agreement is hereby amended
by adding the following sentence at the end of
Section 2.2(a):
“Notwithstanding anything to
contrary in the foregoing, Seller’s Parent shall not exercise
the Put Option with respect to the Generation Asset known as
“C.P. Crane” unless and until Seller’s Parent has
exercised the Put Option with respect to each other Generation
Asset other than the Generation Assets known as “Safe
Harbor”, “Panther Creek/Colver”, “Sunnyside
Cogeneration” and “ACE Cogeneration”. In
addition, Seller’s Parent shall provide ten
(10) Business Days advance notice (the “ Notice
Period ”) prior to delivering an Exercise Notice in
respect of C.P. Crane. Upon delivery of such notice,
Purchaser shall be entitled to propose to Seller’s Parent an
alternative transaction that would provide Seller’s Parent
with comparable after-tax value and liquidity (an “
Alternative Crane Transaction ”), it being agreed that
Seller’s Parent shall not unreasonably withhold its
acceptance of the Alternative Crane Transaction. If, but only
if, Purchaser and Seller’s Parent agree to an Alternative
Crane Transaction prior to the end of the Notice Period,
Seller’s Parent covenants and agrees to forbear from
exercising the Put Option with respect to C.P. Crane and the Put
Option with respect to C.P. Crane shall not be exercisable,
provided that Seller’s Parent and Purchaser enter into a
binding, definitive agreement with respect to the Alternative Crane
Transaction by the end of the Notice Period.”
Section 14.
Amendment to
Section 2.4(d) .
Section 2.4(d) of the Master Agreement is hereby amended
by adding the following sentence at the end of
Section 2.4(d):
“Without limiting the
foregoing, in the case of a Put Option that also requires a
Services Agreement (as defined in the Asset Purchase Agreement)
pursuant to which Seller’s Parent (or one of its subsidiaries
or affiliates) agrees to operate and maintain the generation
facility following closing of a Generation Asset, Seller’s
Parent shall execute and deliver to Purchaser a guaranty in a form
reasonably agreed between Seller’s Parent and Purchaser up to
an aggregate amount of $5,000,000 in respect of all Generation
Assets.”
Section 15.
Amendment to
Section 2.9(a) .
Section 2.9(a) of the Master Agreement is hereby amended
by deleting the words “until the Designated Interest Closing
Date” from the first sentence and replacing them with the
words “until the termination of the Exercise Period”
and by replacing the word “Company” in the last
sentence with the words “Seller’s
Parent”.
Section 16.
Amendment to
Article 3 . Each reference to
Seller in Article 3 shall be deleted and replaced in each case
with the term “Seller’s Parent”, provided,
however, that with
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respect to Sections 3.1,
3.2, 3.3, 3.4, 3.6 and 3.7, each such section shall be read to
apply mutatis mutandis to both Seller and Seller’s Parent,
except that when each such section is read with Seller as the
party, each such representation and warranty shall be as of the
date of this Amendment (and not the date of the Agreement) and
shall be appropriately interpreted to reflect Seller’s status
as a Maryland limited liability company.
Section 17.
Amendment to
Section 3.5 . Section 3.5 of
the Master Agreement is hereby amended and restated in its entirety
to read as follows:
“(a) As of the date of
this Agreement, Seller’s Parent is the lawful owner of 100%
of the outstanding Common Interests, and Seller’s Parent has
good and valid title to such Common Interests, free and clear of
any and all Encumbrances. Immediately prior to the Designated
Interest Closing, Seller will have good and valid title to 99% of
the Common Interests and CE Nuclear will have good and valid title
to 1% of the Common Interests, all of which will be held free and
clear of any and all Encumbrances. The Common Interests
constitute 100% of the outstanding equity interests of the
Company. Except as set forth in Section 1.6
hereof, there are no Contracts between Seller or Seller’s
Parent and any other Person with respect to the acquisition,
disposition or voting of, or any other matters pertaining to, the
Common Interests. The Common Interests are not subject to, or
issued in violation of, any purchase option, call option, right of
first refusal, preemptive right, subscription right or any similar
right under any applicable Law, organizational document or Contract
to which Seller’s Parent or any of its Subsidiaries is a
party or by which Seller’s Parent or any of its Subsidiaries
or any of their assets is bound. Except as set forth in
Section 1.6 hereof, there are no outstanding
obligations arising under any Contract of Seller’s Parent or
its Subsidiaries to repurchase, redeem or otherwise acquire any
securities or equity interests of the Company or its
Subsidiaries. Upon completion of the Designated Interest
Closing, Seller shall have conveyed to Purchaser good and valid
title to the Transferred Designated Interest free and clear of any
and all Encumbrances, and the Company shall have issued the New
Designated Interest to Purchaser free and clear of any and all
Encumbrances.
(b) Immediately prior to the
Designated Interest Closing, Seller shall have good and valid title
to 99% of the Common Interests and CE Nuclear shall have good and
valid title to 1% of the Common Interests, all of will be held free
and clear of any and all Encumbrances. The Common Interests
constitute 100% of the outstanding equity interests of the
Company. Except as set forth in Section 1.6
hereof, there are no Contracts between Seller and any other Person
with respect to the acquisition, disposition or voting of, or any
other matters pertaining to, the Common Interests. The Common
Interests shall not be subject to, or issued in violation of, any
purchase option, call option, right of first refusal, preemptive
right, subscription right or any similar right under any applicable
Law, organizational document or Contract to which Seller or any of
its Subsidiaries is a party or by which Seller or any of its
Subsidiaries or any of their assets shall be bound. Except as
set forth in Section 1.6 hereof, there shall be no
outstanding obligations arising under any Contract of Seller or its
Subsidiaries to repurchase, redeem or otherwise acquire any
securities or equity interests of the Company or its
Subsidiaries. Upon completion of the Designated Interest
Closing, Seller shall have conveyed to
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Purchaser good and valid title to
the Transferred Designated Interest free and clear of any and all
Encumbrances, and the Company shall have issued the New Designated
Interest to Purchaser free and clear of any and all
Encumbrances.”
Section 18.
Amendment to
Article 4 . The lead-in to
Article 4 is hereby amended by deleting the first reference to
the word “Seller” and replacing it with the words
“Seller’s Parent”.
Section 19.
Amendment to
Article 4 . Sections 4.10,
4.22(f) and 4.29 of the Master Agreement are hereby amended by
deleting each reference to the word Seller (as a stand-alone term)
and replacing it in each case with the words “Seller’s
Parent”.
Section 20.
Amendment to
Section 4.3 .
Section 4.3 of the Master Agreement is hereby amended and
restated in its entirety to read as follows:
“The capitalization of the
Company consists of one class of common interests (the “
Common Interests ”). As of the date of this
Agreement, the Common Interests are held solely by Seller’s
Parent, and immediately prior to the Designated Interest Closing,
the Common Interests will be held (i) 99% by Seller and 1% by
CE Nuclear. The Common Interests of the Company are duly
authorized, validly issued, fully paid and nonassessable and are
free and clear from any preemptive or other similar rights.
Other than the aforementioned Common Interests held by
Seller’s Parent as of the date of this Agreement, no equity
interests in the Company are issued or outstanding. Except as
contemplated by Section 1.6, there are (i) no options,
puts, calls, warrants, rights of first refusal or other rights,
agreements, arrangements, restrictions, or commitments of any
character obligating the Company t
