EXHIBIT 7.20
LIMITED LIABILITY COMPANY AGREEMENT
OF
KNIGHT HOLDCO LLC
This Limited Liability Company Agreement (this "Agreement") of Knight
Holdco LLC, dated and effective as of August 28, 2006, is entered into by GS
Capital Partners V Fund, L.P., GS Capital Partners V Offshore Fund, L.P., GS
Capital Partners V GmbH & CO. KG, GS Capital Partners V Institutional, L.P., GS
Global Infrastructure Partners I, L.P. and The ▇▇▇▇▇▇▇ ▇▇▇▇▇ Group, Inc.
(collectively, "GS"), Carlyle Partners IV, L.P. ("Carlyle"), Carlyle/Riverstone
Global Energy and Power Fund III, L.P. ("Riverstone") and AIG Knight LLC ("AIG"
and, together with GS, Carlyle and Riverstone, the "Investor Members" and each
an "Investor Member") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the "Management Group Member" and,
together with the Investor Members, the "Members").
WHEREAS, Knight Holdco LLC, a Delaware limited liability company (the
"Company"), Knight Acquisition Co., a Kansas corporation and wholly owned
subsidiary of the Company ("Merger Sub"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., a Kansas
corporation ("▇▇▇▇▇▇ ▇▇▇▇▇▇") are, concurrently with the execution of this
Agreement, entering into an Agreement and Plan of Merger (the "Merger
Agreement") pursuant to which Merger Sub will be merged with and into ▇▇▇▇▇▇
▇▇▇▇▇▇, with ▇▇▇▇▇▇ ▇▇▇▇▇▇ surviving that merger on the terms and subject to the
conditions set forth in the Merger Agreement (the "Transaction"); and
WHEREAS, the Company and the Management Group Member are, concurrently
with the execution of this Agreement, entering into a voting agreement (the
"Voting Agreement"), pursuant to which the Management Group Member agrees,
subject to the terms and conditions set forth therein, to vote certain Shares
(as defined in the Voting Agreement) in favor of the adoption of the Merger
Agreement.
NOW, THEREFORE, the Members, by execution of this Agreement, hereby
form a limited liability company pursuant to and in accordance with the Delaware
Limited Liability Company Act (6 Del. C. ss. 18-101, et seq.), as amended from
time to time (the "Act"), and hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1. Definitions. When capitalized in this Agreement, the terms set
forth in this Article have the following definitions (capitalized terms used but
not defined herein shall have the meanings given to such terms in the Merger
Agreement):
(a) "Equity Commitment Letters" means the letters from each of the
Investor Members to the Company, dated as of the date of this Agreement,
pursuant to which each of the Investor Members has committed, subject to the
terms thereof, to provide or cause to be provided the cash amounts set forth
therein.
(b) "Equity Commitments" means the amounts set forth next to each
Member's name on Exhibit A hereto, that such Member has committed to provide to
the Company pursuant to and subject to the terms contained in such Member's
Equity Commitment Letter or Equity Rollover Commitment Letter, as applicable.
(c) "Equity Rollover Commitment Letter" means the letter from ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇, dated as of the date of this Agreement, pursuant to which ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ has committed to contribute to the Company the number of shares of ▇▇▇▇▇▇
▇▇▇▇▇▇ common stock set forth therein.
(d) "Guarantee" means the guarantee letter, dated as of the date of
this Agreement, delivered by certain of the Investor Members or their affiliates
to ▇▇▇▇▇▇ ▇▇▇▇▇▇.
(e) "Majority Equity" means the Members (other than any Terminating
Investor Member or Failing Member) whose aggregate Equity Commitments represent
a majority of the Equity Commitments of the Members (other than any Terminating
Investor Member or Failing Member).
(f) "Majority Investor Members" means Investor Members (other than any
Terminating Investor Member or Failing Member) whose aggregate Equity
Commitments represent a majority of the Equity Commitments of the Investor
Members (other than any Terminating Investor Member or Failing Member).
(g) "Majority Members" means the Management Group Member (other than a
Failing Member) and the Majority Investor Members.
ARTICLE II
ORGANIZATIONAL MATTERS
2.1. Name. The name of the limited liability company formed hereby is
Knight Holdco LLC (the "Company").
2.2. Certificates. ▇▇▇▇▇ ▇▇▇▇▇▇▇ is hereby designated as an "authorized
person" within the meaning of the Act, and has executed, delivered and filed the
Certificate of Formation of the Company with the Secretary of State of the State
of Delaware. Upon the filing of the Certificate of Formation with the Secretary
of State of the State of Delaware his powers as an "authorized person" ceased,
and each Member thereupon became a designated "authorized person" and shall
continue as a designated "authorized person" within the meaning of the Act.
Subject to Article IV, a Member, as an authorized person within the meaning of
the Act, shall execute, deliver and file, or cause the execution, delivery and
filing of, all certificates (and any amendments and/or restatements thereof)
required or permitted by the Act to be filed with the Secretary of State of the
State of Delaware. Subject to Article IV, a Member shall execute, deliver and
file, or cause the execution, delivery and filing of, any certificates (and any
amendments and/or restatements thereof) necessary for the Company to qualify to
do business in any other jurisdiction in which the Company may wish to conduct
business.
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2.3. Purposes. The purpose and business of the Company is to enter into
the Transaction.
2.4. Powers. Except as otherwise provided in this Agreement, the Act or
any other applicable laws and regulations, the Company shall have the power and
authority to take any and all actions that are necessary, appropriate, proper,
advisable, incidental or convenient to or for the furtherance of the purposes
described herein.
2.5. Principal Business Office. The principal business office of the
Company shall be located at such location as may hereafter be determined by the
Members.
2.6. Registered Office. The address of the Company's registered office
in Delaware is c/o the Corporation Service Company, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
2.7. Registered Agent. The name and address of the registered agent in
Delaware for service of process are the Corporation Service Company, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇.
2.8. Members. The names and mailing addresses of the Members, and their
respective capital contributions, are as follows:
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------------------------------------ ---------------------------- --------------
Capital
Name Address Contribution
------------------------------------ ---------------------------- --------------
GS Capital Partners V Fund, L.P. ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ $ 0.33
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
------------------------------------ ---------------------------- --------------
GS Capital Partners V Offshore ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ $ 0.17
Fund, L.P. ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
------------------------------------ ---------------------------- --------------
GS Capital Partners V GmbH & CO. KG ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ $ 0.01
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
------------------------------------ ---------------------------- --------------
GS Capital Partners V Institutional, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ $ 0.11
L.P. ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
------------------------------------ ---------------------------- --------------
GS Global Infrastructure Partners I, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ $ 0.38
L.P. ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
------------------------------------ ---------------------------- --------------
The ▇▇▇▇▇▇▇ ▇▇▇▇▇ Group, Inc. ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ $ 1.82
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
------------------------------------ ---------------------------- --------------
Carlyle Partners IV, L.P. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇▇ $ 1.25
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
------------------------------------ ---------------------------- --------------
Carlyle/Riverstone Global Energy ▇▇▇ ▇▇▇▇▇ ▇▇▇. $ 1.25
and Power Fund III, L.P. ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
------------------------------------ ---------------------------- --------------
AIG Knight LLC ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ $ 1.60
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
------------------------------------ ---------------------------- --------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ $ 3.07
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
------------------------------------ ---------------------------- --------------
2.9. Officers. The Majority Members may, from time to time as they deem
advisable, select natural persons and designate them as officers of the Company
(the "Officers") and assign titles (including, without limitation, President,
Vice President, Secretary, and Treasurer) to any such person. Unless the
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Majority Members decide otherwise, if the title is one commonly used for
officers of a business corporation formed under the Delaware General Corporation
Law (the "DGCL"), the assignment of such title shall constitute the delegation
to such person of the authorities and duties that are normally associated with
that office, except to the extent otherwise limited by this Agreement. An
Officer may be removed with or without cause by the Majority Members.
2.10. Admission of Additional Members. One or more additional members
of the Company may be admitted to the Company with the unanimous written consent
of the Members, not including the consent of the Terminating Investor Member, if
any.
2.11. Effective Time. This Agreement shall become effective upon the
execution of this Agreement by all of the Members and shall be effective until
the earlier of (i) the consummation of the Merger under the Merger Agreement, at
which time this Agreement shall be amended and restated in accordance with the
Amended and Restated Limited Liability Company Agreement of Knight Holdco LLC
(the "Amended LLC Agreement"), substantially in the form attached as Exhibit B
hereto; provided, however, that Sections 5.7, 5.8 and 5.9 shall continue in full
force and effect and be enforceable against the parties to this Agreement, and
(ii) the dissolution of the Company pursuant to Section 6.3. The Members hereby
agree that they shall enter into the Amended LLC Agreement upon the consummation
of the Merger under the Merger Agreement.
ARTICLE III
CAPITALIZATION; DISTRIBUTIONS
3.1. Capital Contributions. The Members are deemed admitted as Members
of the Company upon their execution and delivery of this Agreement. Each Member
has contributed the amount set forth in Section 2.8. If the Majority Equity
determine that the aggregate Equity Commitments of the Members shall be reduced,
the Equity Commitments of each Investor Member shall be reduced pro rata based
on their respective Equity Commitments.
3.2. Additional Contributions. Except to the extent provided in the
Equity Commitment Letters or the Equity Rollover Commitment Letter (subject to
the terms of such letters and this Agreement), a Member is not required to make
any additional capital contribution to the Company, and without unanimous
consent of the Members shall not make any additional capital contributions.
3.3. Distributions. With the exception of the Termination Fee, which
shall be distributed as promptly as practicable upon its receipt and allocated
in accordance with Section 5.6(a), distributions shall be made to the Members at
the times and in the aggregate amounts determined by the Majority Members, and
shall be distributed pro rata among the Members in proportion to their
respective Equity Commitments. Notwithstanding any provision to the contrary
contained in this Agreement, the Company shall not make a distribution to the
Members on account of their interests in the Company if such distribution would
violate the Act or other applicable law.
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ARTICLE IV
MEMBERS AND ACTIONS
4.1. Powers of Members. The Members shall have the power to exercise
any and all rights or powers granted to the Members pursuant to the express
terms of this Agreement. Members shall not have the authority to bind the
Company by virtue of their status as Members.
4.2. Majority Member Decisions. (a) Except to the extent any Section of
this Agreement expressly provides otherwise, the Majority Members, in
consultation with all Members, shall make all decisions with respect to all
actions taken by the Company or its Subsidiaries (including Merger Sub),
including, but not limited to, any decision with respect to the Merger Agreement
other than as set forth in Section 4.3; provided, however, that the Majority
Members may not cause the Company or Merger Sub to take any action in a way that
has a material disproportionate and adverse impact on an Investor Member
relative to the other Investor Members without such materially
disproportionately and adversely impacted Investor Member's consent, other than
action set forth in this Agreement.
(b) If the Majority Members have agreed to take any action under
Section 4.2(a) (i) to increase or modify the amount or form of the consideration
to be offered by the Members to acquire ▇▇▇▇▇▇ ▇▇▇▇▇▇ in the Transaction (such a
decision, a "Change in Merger Consideration") or (ii) to modify or waive, in a
manner adverse to the Company or the Investor Members, the provisions of the
Merger Agreement relating to the Termination Fee or Reverse Termination Fee (any
such action in (i) or (ii), a "Trigger Action"), and any Investor Member
declines to consent to such Trigger Action, such Investor Member may terminate
its participation in the Transaction (a "Terminating Investor Member") and shall
have no obligation to contribute its proportionate share of the Equity
Commitments or have any liability by reason of this Agreement, the Merger
Agreement, the Equity Commitment Letters, the Guarantees or any related
documents (except in respect of prior breaches, if any) other than any
obligation or liability pursuant to Sections 5.5, 5.6, 5.7 and Article VI of
this Agreement, whether or not the Transaction is ultimately consummated, and
the Terminating Investor Member shall be released from any liability under this
Agreement, the Merger Agreement, the Equity Commitment Letters, the Guarantees
or any related documents, other than as set forth above; provided, however, that
if the Terminating Investor Member is subsequently replaced by a new Investor
Member that assumes in full the Terminating Investor Member's Equity Commitment,
the Terminating Investor Member's obligation to pay its proportionate share of
Aggregate Fees and Expenses (as defined below) shall also be assumed by the new
Investor Member, provided further that the Terminating Investor Member's
obligation to pay its proportionate share of Aggregate Fees and Expenses shall
also be reduced pro rata to the extent the Terminating Investor Member's Equity
Commitment is accepted by the other Investor Members or new investors pursuant
to the last sentence of this Section 4.2(b). The Majority Members must provide
two business days' prior written notice of their intention to approve any
Trigger Action pursuant to Section 4.2(a). Upon receipt of any such notice, if
an Investor Member does not provide written notice to the other Members within
two business days of its intent to terminate its participation in the
Transaction pursuant to this Section 4.2(b), it shall be deemed to have
consented to such Trigger Action. For the avoidance of doubt, in the event an
Investor Member terminates its participation in the Transaction, such
Terminating Investor Member shall no longer be an Investor Member or a Member of
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the Company, but shall remain bound by the terms of such Investor Member's
confidentiality and exclusivity agreement with GS, dated May 2006. In the event
an Investor Member terminates its participation in the Transaction, the amount
of the Terminating Investor Member's Equity Commitment shall first be offered to
the other Investor Members in proportion to their respective Equity Commitments
at the time of such termination, and if none or not all of the Terminating
Investor Member's Equity Commitment is accepted by the other Investor Members,
then the Majority Investor Members (excluding, for this purpose, the Terminating
Investor Member) may offer the Terminating Investor Member's Equity Commitment,
or remaining portion thereof, to the other Investor Members or to a new investor
or investors.
4.3. Majority Investor Decisions. The Majority Investor Members shall
have the exclusive right to make any determination (including with respect to
waivers of any conditions and determination as to satisfaction of any
conditions) or decision to exercise any rights to terminate the Merger Agreement
pursuant to Section 7.1 ("Termination or Abandonment") of the Merger Agreement
or to waive any conditions specified under Sections 6.1 ("Conditions to Each
Party's Obligation to Effect the Merger") and 6.3 ("Conditions to Obligation of
Parent and Merger Sub to Effect the Merger") of the Merger Agreement, including
preparatory action relating to any of the foregoing (e.g., writing of letters),
which decision or termination shall be absolute and binding on the other Members
and shall be exercised in the sole discretion of the Majority Investor Members.
4.4. Public Announcements. Except as otherwise required by law,
including any securities laws or rules of a self-regulatory organization, the
content of all public announcements concerning the Transaction issued by any
Member shall be subject to the consent of all the Members, which consent shall
not be unreasonably withheld.
4.5. Syndication. No Member may syndicate its Equity Commitment without
the prior written consent of the Majority Equity. Notwithstanding anything to
the contrary contained in this Agreement, an Investor Member may syndicate its
Equity Commitment without the prior written consent of the Majority Equity to
its affiliated funds, entities and investment vehicles and to co-investors where
the Investor Member retains direct or indirect control over voting and
disposition (a "Permitted Assignee"); provided, however, that, other than in the
case of syndication by The ▇▇▇▇▇▇▇ Sachs Group, Inc., no such syndication shall
relieve such Investor Member of its obligations under this Agreement and its
Equity Commitment Letter. At Closing, the Members will cause their respective
Permitted Assignees to enter into all documentation necessary to cause such
Permitted Assignee to become a Member.
4.6. Debt Financing. All actions and decisions of the Company or Merger
Sub with respect to debt financing (including with respect to existing debt
commitments) shall require the approval of the Majority Equity. Without limiting
the foregoing, the Majority Equity may cause the Company or Merger Sub to
negotiate, enter into and borrow under definitive agreements relating to debt
financing to be provided at the Closing.
4.7. Failing Members. If at the Closing, the conditions to a Member's
equity financing commitment set forth in the Equity Commitment Letter or Equity
Rollover Commitment Letter, as applicable, are satisfied (it being understood
that any decision in accordance with Section 4.3 shall govern such
determination) but such Member does not fund its commitment or asserts in
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writing its unwillingness to fund its commitment in violation of this Agreement
or its Equity Commitment Letter or Equity Rollover Commitment Letter, as
applicable (a "Failing Member"), the non-Failing Members will be entitled, upon
the agreement of the Majority Equity (other than the Failing Member(s)), to:
(a) terminate the Failing Member's participation in the Transaction, it
being understood that no such termination shall affect the other Members' rights
against such Failing Member with respect to such failure or unwillingness to
fund;
(b) require specific performance of the provisions of such Failing
Member's Equity Commitment (and/or limited guaranty, if applicable), whether
before or after the Closing, together with any costs of enforcement, the Members
hereby acknowledging and agreeing that irreparable damage would occur in the
event such provisions were not performed in accordance with the terms therein;
and/or
(c) require payment by the Failing Member in an amount equal to the
actual damages caused by such Failing Member (including amounts paid under any
Reverse Termination Fee) up to the amount of the entire Reverse Termination Fee
plus any out-of-pocket expenses incurred by the non-Failing Members in
connection with the Transaction. Notwithstanding any provision in this Agreement
to the contrary, no Member shall be liable for damages in excess of the sum of
the Reverse Termination Fee plus out-of-pocket expenses incurred by the
non-Failing Members in connection with the Transaction as a result of such
Member's breach of this Agreement or such Member's Equity Commitment Letter or
Equity Rollover Commitment Letter, as applicable.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1. Regulatory Efforts.
(a) If any Governmental Entity asserts any objections under any
antitrust, energy or other regulatory law or regulation with respect to the
Transaction in connection with Specified Regulatory Clearances (as defined in
the Merger Agreement) that are conditions precedent under the Merger Agreement
to the Closing and such objections relate to the activities or investments of an
Investor Member or such Investor Member's affiliated funds, such Investor Member
will use its reasonable best efforts to take such actions that are within its
power and authority as may be necessary to resolve such objections with respect
to the Transaction so as to enable the Closing to occur no later than the
earlier of (x) the End Date (as defined in the Merger Agreement) and (y) the
date all other conditions to Closing have been satisfied (or, if later, 90 days
after the date hereof).
(b) No Member shall commit to take any actions or positions on behalf
of the Company with respect to obtaining a clearance or approval from any
Governmental Entity for the Transaction without the approval of the Majority
Equity. All Members shall make reasonable best efforts to give each Member the
opportunity to participate in making any decisions as to actions or positions
8
the Company will take with respect to obtaining a clearance or approval from any
Governmental Entity for the Transaction.
(c) Subject to applicable law, no Member shall, and the Company will
not, commit to take any actions or positions on behalf of any other Members in
connection with obtaining regulatory clearances without such Member's prior
consent.
5.2. Voting Agreement. All actions and decisions to be taken by the
Company or Merger Sub relating to the Voting Agreement, including with respect
to any waivers, extensions, amendments, enforcement actions or negotiations
relating to any of the foregoing, shall be made or taken by the Majority
Investor Members.
5.3. Equity Commitment Letters. Except as set forth in Section 4.7, all
actions and decisions to be taken by the Company relating to any Equity
Commitment Letter (other than amendment of any Equity Commitment Letter),
including with respect to any waivers, extensions, amendments, enforcement
actions or negotiations relating to any of the foregoing, shall be made or taken
by the Majority Equity (excluding, for this purpose, the Investor Member
signatory thereto).
5.4. Equity Rollover Commitment Letter. Except as set forth in Section
4.7, all actions and decisions to be taken by the Company relating to the Equity
Rollover Commitment Letter, including with respect to any waivers, extensions,
amendments, enforcement actions or negotiations relating to any of the
foregoing, shall be made or taken by the Majority Investor Members.
5.5. Information Supplied. Each Member hereby represents, warrants and
covenants to the other Members that none of the information supplied in writing
by such Member for inclusion or incorporation by reference in the Proxy
Statement and the Schedule 13E-3 will cause a breach of the representation and
warranty of the Company or Merger Sub set forth in Section 4.3 of the Merger
Agreement.
5.6. Allocation of Termination Fee. (a) Any termination fee or expense
reimbursement payment paid by ▇▇▇▇▇▇ ▇▇▇▇▇▇ or any of its affiliates pursuant to
the Merger Agreement (the "Termination Fee") will be applied first (i) to any
out-of-pocket expenses and fees incurred by the Members in connection with the
Transaction, including legal fees and fees required to be paid to the Members'
financial advisor(s) in the event of a termination of the Merger Agreement but
excluding fees or expenses incurred pursuant to Section 5.1, and second (ii) to
the Investor Members (other than any Failing Member or Terminating Investor
Member) or their designees and in proportion to their respective Equity
Commitments.
(b) In the event any termination fee or expense reimbursement payment
is required to be paid by the Members (including as a result of any obligation
by the Company and/or Merger Sub to pay such a fee or payment under the Merger
Agreement) to ▇▇▇▇▇▇ ▇▇▇▇▇▇ (such fee or payment, a "Reverse Termination Fee"),
the Reverse Termination Fee shall be paid by the Investor Members in proportion
to their respective Equity Commitments; provided, however, that in the event the
Reverse Termination Fee is payable as a result of a breach of this Agreement or
such Member's Equity Commitment Letter or Equity Rollover Commitment Letter, as
9
applicable, by any Member (such Member, the "Defaulting Member"), the Defaulting
Member shall pay and bear the full responsibility for payment of the Reverse
Termination Fee and the Members who are not Defaulting Members (the
"Non-Defaulting Members") shall not be required to pay any amount of the Reverse
Termination Fee. In the event there are two or more Defaulting Members, the
Defaulting Members shall be liable to pay the entire Reverse Termination Fee in
proportion to the ratio of the Equity Commitment of each Defaulting Member to
the Equity Commitments of the other Defaulting Member(s).
5.7. Allocation of Expenses. If the Transaction is consummated, the
Company shall cause the surviving corporation (i.e., ▇▇▇▇▇▇ ▇▇▇▇▇▇) to pay or
reimburse each Member (other than a Failing Investor Member) for any and all
out-of-pocket fees and expenses incurred by it in connection with the
Transaction; provided, that a Terminating Investor Member shall only be entitled
to be reimbursed for its fees and expenses incurred prior to such Member
becoming a Terminating Investor Member. If the Transaction is not consummated,
(a) each of the Investor Members (including a Failing Investor Member and a
Terminating Investor Member) will be responsible for the fees and expenses of
legal counsel, accountants, financial advisors and other consultants or advisors
and any financing or other fees and expenses incurred by Parent or Merger Sub or
by any of the Investor Members in connection with the transactions contemplated
by the Merger Agreement, excluding the Management Fees and Expenses (as defined
below), but including any expenses incurred in connection with due diligence and
the negotiation of the Merger Agreement and any related documents and any
regulatory filing fees (the "Group Fees and Expenses") in proportion to their
respective Equity Commitments; provided, however, that a Terminating Investor
Member shall only be responsible for its proportionate share of the Group Fees
and Expenses incurred prior to such Member becoming a Terminating Investor
Member, and (b) the Management Group Member shall be responsible for the fees
and expenses of (i) Weil, Gotshal & ▇▇▇▇▇▇ LLP as legal counsel to the
Management Group Member and (ii) as identified in Exhibit C hereto (the
"Management Fees and Expenses"). Except as provided in the first sentence of
this Section 5.7, in no event shall the Investor Members be responsible for the
Management Fees and Expenses.
5.8. Transaction Fee. At the Closing, the Company shall pay a
transaction fee to each Investor Member (or its designees) in the amount set
forth beside such Investor Member's name on Exhibit D hereto (the "Transaction
Fees").
5.9. Termination of Agreements. The Members hereby agree that upon the
consummation of the Merger, the Members shall, or shall cause ▇▇▇▇▇▇ ▇▇▇▇▇▇ to,
as applicable take all actions necessary to effectuate the termination of the
following agreements: (i) the exclusivity agreement by and between GS and AIG,
dated May 22, 2006; (ii) the exclusivity agreement by and between GS and
Carlyle, dated May 22, 2006; (iii) the exclusivity agreement by and between GS
and Riverstone, dated May 21, 2006; (iv) the confidentiality agreement by and
between ▇▇▇▇▇▇ ▇▇▇▇▇▇ and AIG, dated June 20, 2006; (v) the confidentiality
agreement by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇ and Carlyle, dated June 20, 2006; (vi)
the confidentiality agreement between ▇▇▇▇▇▇ ▇▇▇▇▇▇ and GS, dated June 20, 2006;
(vii) the confidentiality agreement between ▇▇▇▇▇▇ ▇▇▇▇▇▇ and Riverstone, dated
June 20, 2006; and (viii) the confidentiality agreements between ▇▇▇▇▇▇ ▇▇▇▇▇▇
and certain members of ▇▇▇▇▇▇ ▇▇▇▇▇▇ management, dated June 19, 2006.
10
5.10. Contributions With Respect to Guarantees. The Members shall
cooperate in defending any claim with respect to which the Investor Members are
or any of them is, or is alleged to be, liable to make payments under the
Guarantees. Subject to Sections 4.7 and 5.6, each Investor Member agrees to
contribute to the amount paid or payable by the other Investor Members in
respect of the Guarantees so that each Investor Member will have paid an amount
equal to the product of the aggregate amount paid under all of the Guarantees
multiplied by a fraction of which the numerator is such Investor Member's Equity
Commitment and the denominator is the sum of the Investor Members' Equity
Commitments, which amount shall be reduced proportionately based on such
Investor Members' respective Equity Commitments for any amounts paid or payable
with respect to such Guarantees by any other Investor Member or other person
contribution equity to the Company pursuant to the terms of such Investor
Member's Equity Commitment Letter.
5.11. Allocation of Class B Units. The Management Group Member shall
allocate the Class B Units (as defined in the Amended LLC Agreement), subject to
the prior consent of the Majority Investor Members (such consent not to be
unreasonably withheld).
5.12. Additional Rollover. The Members hereby agree that additional
rollovers of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Stock by stockholders shall be governed by the terms
set forth on Exhibit E hereto.
ARTICLE VI
GENERAL PROVISIONS
6.1. Limited Liability. Except as otherwise provided by the Act, the
debts, obligations and liabilities of the Company, whether arising in contract,
tort or otherwise, shall be solely the debts, obligations and liabilities of the
Company, and the Members shall not be obligated personally for any such debt,
obligation or liability of the Company solely by reason of being a member of the
Company.
6.2. Assignments/Transfers. Except in connection with a syndication
permitted under Section 4.5, a Member may not at any time (i) assign in whole or
in part its limited liability company interest in the Company without the prior
written consent of all Members or (ii) transfer in whole or in part its limited
liability company interest in the Company without the prior written consent of
all Members.
6.3. Dissolution. (a) The Company shall dissolve and its affairs shall
be wound up upon the first to occur of the following: (i) the later of (x) the
termination of the Merger Agreement by the Company or ▇▇▇▇▇▇ ▇▇▇▇▇▇ pursuant to
Section 7.1 of the Merger Agreement and (y) the payment of all fees due to the
Company thereunder; (ii) the unanimous written consent of the Members; (iii) at
any time there are no members of the Company unless the Company is continued in
accordance with the Act, or (iv) the entry of a decree of judicial dissolution
under Section 18-802 of the Act.
(b) The bankruptcy of a Member shall not cause such Member to cease to
be a member of the Company and, upon the occurrence of such an event, the
11
business of the Company shall continue without dissolution.
(c) In the event of dissolution, the Company shall conduct only such
activities as are necessary to wind up its affairs (including the sale of the
assets of the Company in an orderly manner), and the assets of the Company shall
be applied in the manner, and in the order of priority, set forth in Section
18-804 of the Act.
(d) Upon the cancellation of the Certificate of Formation of the
Company in accordance with the Act, the Company and this Agreement shall
terminate.
6.4. Severability of Provisions. Each provision of this Agreement shall
be considered separable, and if for any reason any provision or provisions
herein are determined to be invalid, unenforceable or illegal under any existing
or future law, such invalidity, unenforceability or illegality shall not impair
the operation of or affect those portions of this Agreement that are valid,
enforceable and legal.
6.5. Entire Agreement. This Agreement constitutes the entire agreement
of the Members with respect to the subject matter hereof.
6.6. Governing Law. This Agreement shall be governed by, and construed
under, the laws of the State of Delaware (without regard to conflict of laws
principles), all rights and remedies being governed by said laws.
6.7. Amendments. This Agreement may not be modified, altered,
supplemented or amended except pursuant to a written agreement executed by all
of the parties hereto.
6.8. Sole Benefit of the Members. Except as expressly provided in this
Agreement, the provisions of this Agreement are intended solely to benefit the
Members and, to the fullest extent permitted by applicable law, shall not be
construed as conferring any benefit upon any creditor of the Company (and no
such creditor shall be a third-party beneficiary of this Agreement), and no
Member shall have any duty or obligation to any creditor of the Company to make
any contributions or payments to the Company.
(signature follows)
12
IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has
duly executed this Agreement as of the date first written above.
GS CAPITAL PARTNERS V FUND, L.P.
By: GSCP V Advisors, L.L.C., its General Partner
By: /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
GS CAPITAL PARTNERS V INSTITUTIONAL, L.P.
By: GS Advisors V, L.L.C., its General Partner
By: /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
GS GLOBAL INFRASTRUCTURE PARTNERS I, L.P.
By: GS Infrastructure Advisors 2006, L.L.C., its General Partner
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
GS CAPITAL PARTNERS V OFFSHORE FUND, L.P.
By: GSCP V Offshore Advisors, L.L.C, its General Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
GS CAPITAL PARTNERS V GMBH & CO. KG
By: GS Advisors V, L.L.C., its Managing Partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
THE ▇▇▇▇▇▇▇ ▇▇▇▇▇ GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Treasurer
CARLYLE PARTNERS IV, L.P.
By: TC Group IV, L.P., its General Partner
By: TC Group IV, L.L.C., its General Partner
By: TC Group, L.L.C., its Sole Member
By: TCG Holdings, L.L.C.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title:
CARLYLE/RIVERSTONE GLOBAL ENERGY AND POWER FUND III, L.P.
By: Carlyle/Riverstone Energy Partners III, L.P., its General Partner
By: C/R Energy GP III, LLC, its General Partner
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Title: Authorized Person
AIG KNIGHT LLC
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:
/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
