EXHIBIT 10.51
LLC MEMBERSHIP INTEREST PURCHASE AGREEMENT
BY AND BETWEEN
CMS PANHANDLE HOLDINGS, LLC
AS SELLER
AND
MARATHON ASHLAND PETROLEUM LLC
AND
TE PRODUCTS PIPELINE COMPANY, LIMITED PARTNERSHIP
SEVERALLY AS BUYERS
JANUARY 30, 2003
LLC MEMBERSHIP INTEREST PURCHASE AGREEMENT
THIS LLC MEMBERSHIP INTEREST PURCHASE AGREEMENT (this "Agreement") is
entered into as of January 30, 2003, by and between CMS PANHANDLE HOLDINGS, LLC,
a Delaware limited liability company (the "Seller"), and MARATHON ASHLAND
PETROLEUM LLC, a Delaware limited liability company ("MAP") and TE PRODUCTS
PIPELINE COMPANY, LIMITED PARTNERSHIP, a Delaware limited partnership,
("TEPPCO") (MAP and TEPPCO severally herein the "Buyers"). The Seller and the
Buyers are sometimes referred to collectively herein as the "Parties" and
individually as a "Party."
RECITALS
WHEREAS, Seller's predecessor in interest, Panhandle Eastern Pipe Line
Company ("PEPL"), MAP and TEPPCO are the sole members of Centennial Pipeline
LLC, a Delaware limited liability company ("Centennial"), pursuant to that
certain Amended and Restated Limited Liability Company Agreement entered into
among them effective August 20, 2000, amended on May 4, 2001 and on December 3,
2002 ("LLC Agreement"); and
WHEREAS, the Seller's membership interest in Centennial was acquired by
assignment from PEPL, its Affiliate, on November 1, 2001; and
WHEREAS, the Seller owns a 33 1/3% membership interest in Centennial (the
"Membership Interest"); and
WHEREAS, each of the Buyers owns a 33 1/3% membership interest in
Centennial; and
WHEREAS, the Parties have reached an agreement in principle pursuant to
which Seller will sell to the Buyers, and the Buyers will purchase from Seller,
in equal shares, Seller's Membership Interest; and
WHEREAS, the Parties desire hereby to reduce their agreement to writing.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows:
1. Definitions.
"Adverse Consequences" means all actions, suits, proceedings,
hearings, investigations, charges, complaints, claims, demands, injunctions,
judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs,
amounts paid in settlement, liabilities, obligations,
taxes, liens, losses, expenses, and fees, including court costs and attorneys'
fees and expenses, but excluding punitive, exemplary, special or consequential
damages (except as to third party claims for which a Party has rights of
indemnification under this Agreement).
"Affiliate" has the meaning set forth in Rule 12b-2 of the
regulations promulgated under the Securities Exchange Act.
"Buyers" has the meaning set forth in the preface.
"Centennial" has the meaning set forth in the recitals.
"Centennial Assets" means all of the assets of Centennial of
whatever nature.
"Centennial Project Debt" means the debt facility pursuant to that
certain Master Shelf Agreement dated as of May 4, 2001, as amended and in effect
from time to time, by and between Centennial and The Prudential Insurance
Company of America pursuant to which $140,000,000 Senior Notes were issued and
that certain Revolving Note Agreement dated as of May 4, 2001, as amended and in
effect from time to time, by and between Centennial and The Prudential Insurance
Company of America pursuant to which Senior Floating Rate Revolving Notes due
May 4, 2004 were issued.
"Closing" has the meaning set forth in Section 2(c).
"Closing Date" has the meaning set forth in Section 2(c).
"Encumbrance" means any mortgage, pledge, lien (including tax
liens), encumbrance, charge, other security interest or defect in title.
"Governmental Authority" means the United States and any state,
county, city or other political subdivision, agency, court or instrumentality.
"Indemnified Party" has the meaning set forth in Section 7(d).
"Indemnifying Party" has the meaning set forth in Section 7(d).
"Laws" means any statute, code, regulation, rule, injunction,
judgment, order, decree, ruling, charge or other restriction of any applicable
Governmental Authority.
"LLC Agreement" has the meaning set forth in the recitals.
"Maintenance Agreement" has the meaning set forth in Section 4(h).
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"Material Adverse Effect" means any change or effect that,
individually or in the aggregate with other changes or effects, is materially
adverse to the businesses, operations and properties of a Buyer, Seller or
Centennial, each taken as a whole, provided that in determining whether a
Material Adverse Effect has occurred, changes or effects relating to (i) the
liquids pipeline industry generally (including, but not limited to, the price of
liquids and the costs associated with the production and delivery of liquids) or
changes in the regulation thereof, or (ii) United States or global economic
conditions or financial markets in general, shall not be considered.
"Membership Interest" has the meaning set forth in the recitals.
"Party" and "Parties" have the meanings set forth in the preface.
"PEPL" means Panhandle Eastern Pipe Line Company, a Delaware
corporation.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, or a governmental entity (or any department, agency or political
subdivision thereof).
"Post-Closing Membership Interest" has the meaning set forth in
Section 2(a).
"Purchase Price" has the meaning set forth in Section 2(b).
"Seller" has the meaning set forth in the preface.
"Third Party Claim" has the meaning set forth in Section 7(d).
"Trunkline" means CMS Trunkline Gas Company, LLC, a Delaware limited
liability company, formerly known as Trunkline Gas Company.
2. Purchase and Sale.
(a) Sale of Membership Interest. Subject to the terms and
conditions of this Agreement, the Seller agrees to sell to the
Buyers, and the Buyers agree to purchase from the Seller, in
equal shares, all of the Seller's right, title and interest in
and to the Membership Interest. From and after such sale and
purchase, each of the Buyers shall own a 50% membership
interest in Centennial ("Post-Closing Membership Interest").
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(b) Purchase Price. In consideration for the sale of the
Membership Interest, each of the Buyers agrees to pay to the
Seller at the Closing TWENTY MILLION DOLLARS ($20,000,000.00)
(with respect to each Buyer, the "Purchase Price") payable by
wire transfer or delivery of other immediately available
funds, pursuant to Seller's written instructions received at
least five (5) days prior to the Closing.
(c) The Closing. The closing of the transactions contemplated by
this Agreement (the "Closing") shall take place at the offices
of the Seller, commencing at 9:00 a.m. local time on the
second business day following the satisfaction or waiver of
all conditions to the obligations of the Parties to consummate
the transactions contemplated hereby (other than conditions
with respect to actions each Party will take at the Closing
itself) or such other date as the Parties may mutually
determine (the "Closing Date").
(d) Deliveries at the Closing. At the Closing, (i) the Seller will
deliver to the Buyers the various certificates, instruments,
and documents referred to in Section 6(a), (ii) each of the
Buyers will deliver to the Seller the various certificates,
instruments, and documents referred to in Section 6(b), (iii)
the Seller will deliver to each of the Buyers an Assignment
and Conveyance in the form of Exhibit 2(d) transferring to
each Buyer its respective share of the Seller's right, title
and interest in and to the Membership Interest, and (iv) each
of the Buyers will deliver to the Seller the Purchase Price.
3. Representations and Warranties Concerning the Transaction.
(a) Representations and Warranties of the Seller. The Seller
hereby, severally, represents and warrants to each Buyer as
follows:
(i) Organization of the Seller. The Seller is a limited
liability company duly organized, validly existing, and
in good standing under the Laws of the state of
Delaware. Seller is duly licensed or qualified and in
good standing as a foreign entity authorized to do
business in all jurisdictions wherein the character of
the property owned or leased, or the nature of the
activities conducted, by it make such licensing or
qualification necessary, except where the failure to be
so licensed or qualified would not constitute a Material
Adverse Effect.
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(ii) Authorization of Transaction. The Seller has full power
and authority (including full limited liability company
power and authority) to execute and deliver this
Agreement and to perform its obligations hereunder. Upon
receipt of the approval of Seller's Board of Directors
referenced in Schedule 3(a)(ii), this Agreement and the
transactions contemplated hereby will have been duly
authorized by all requisite limited liability company
action on the part of the Seller and no further
corporate approvals will be required to execute and
deliver this Agreement or to consummate such
transactions. This Agreement has been duly executed and
delivered by Seller and constitutes the valid and
legally binding obligation of the Seller, enforceable in
accordance with its terms and conditions, subject,
however, to the effects of bankruptcy, insolvency,
reorganization, moratorium or similar Laws affecting
creditors' rights generally, and to general principles
of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Except
as set forth on Schedule 3(a)(ii), the Seller need not
give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any Governmental
Authority or any Person in order to consummate the
transactions contemplated by this Agreement. Seller has
received, or will have received by the Closing any
written consent required of Southern Union Panhandle
Corp. for Seller to execute and deliver this Agreement
and for Seller to perform its obligations hereunder.
(iii) Noncontravention. Except for the approvals and filings
specified in Section 3(a)(ii) or as set forth in
Schedule 3(a)(iii), neither the execution and delivery
of this Agreement, nor the consummation of the
transactions contemplated hereby, will (A) violate any
statute, regulation, rule, injunction, judgment, order,
decree, ruling, charge, or other restriction of any
Governmental Authority to which the Seller is subject or
any provision of its charter or bylaws or (B) conflict
with, result in a breach of, constitute a default under,
result in the acceleration of, create in any party the
right to accelerate, terminate, modify, or cancel, or
require any notice, approval or consent under any
agreement, contract, lease, license, instrument, or
other arrangement to which the Seller is a party or by
which it is bound or to which any of its assets is
subject,
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including the Centennial LLC Agreement, except for such
violations, defaults, breaches, or other occurrences
that do not, individually or in the aggregate, have a
Material Adverse Effect or a material adverse effect on
the ability of the Seller to consummate the transactions
contemplated by this Agreement, and except for any
requirements that have been specifically waived herein
by the Buyers.
(iv) Brokers' Fees. The Seller has no liability or obligation
to pay any fees or commissions to any broker, finder, or
agent with respect to the transactions contemplated by
this Agreement for which the Buyers could become liable
or obligated.
(v) Capitalization of Centennial. Seller has legal and
beneficial ownership of the Membership Interest, free
and clear of any restrictions on transfer or
Encumbrances other than as is provided in the Centennial
LLC Agreement. Upon transfer of the Membership Interest
to the Buyers pursuant to this Agreement, the Buyers
will own, legally and beneficially, the Membership
Interest as herein provided, in each case, free and
clear of any restrictions on transfer or Encumbrances
by, through or under Seller, other than as is provided
in the Centennial LLC Agreement. Seller has no
membership interests issued or outstanding in Centennial
other than the Membership Interest. The Membership
Interest has been duly authorized, is validly issued and
is owned of record by the Seller. There are no
outstanding or authorized options, warrants, purchase
rights, subscription rights, conversion rights, exchange
rights, or other contracts, commitments, equities,
claims, or demands that could require the Seller to
sell, transfer, or otherwise dispose of any of the
Membership Interest (other than this Agreement). The
Seller is not a party to any voting trust, proxy, or
other agreement or understanding with respect to the
voting of any membership interests, including the
Membership Interest, of Centennial.
(vi) Litigation. There is no litigation pending against
Seller or any of its Affiliates that seeks to modify or
prevent the consummation of any of the transactions or
related agreements contemplated herein.
(b) Representations and Warranties of each Buyer. Each Buyer,
severally and not jointly, hereby represent represents and
warrants to Seller as follows,
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each Buyer representing and warranting only as to itself and
not as to the other Buyer:
(i) Organization of the Buyers. MAP is a limited liability
company duly organized, validly existing and in good
standing under the Laws of the state of Delaware. TEPPCO
is a limited partnership duly organized, validly
existing and in good standing under the Laws of the
state of Delaware. The Buyer is duly licensed or
qualified and in good standing as a foreign entity
authorized to do business in all jurisdictions wherein
character of the property owned or leased, or the nature
of the activities conducted, by it make such licensing
or qualification necessary, except where the failure to
be so licensed or qualified would not constitute a
Material Adverse Effect on the Buyer.
(ii) Authorization of Transaction. The Buyer has full power
and authority (including, with respect to MAP, full
limited liability company power and authority, and with
respect to TEPPCO, full limited partnership power and
authority) to execute and deliver this Agreement and to
perform its obligations hereunder. Upon receipt of the
approval of the applicable Board of Directors or Board
of Managers referenced in Schedule 3(b)(ii), this
Agreement and the transactions contemplated hereby will
have been duly authorized by all requisite limited
liability company or partnership, as applicable, action
on the part of the Buyer and no further limited
liability company or partnership approvals will be
required to execute and deliver this Agreement or to
consummate such transactions. This Agreement has been
duly executed and delivered by Buyer and constitutes the
valid and legally binding obligation of the Buyer,
enforceable in accordance with its terms and conditions,
subject, however, to the effects of bankruptcy,
insolvency, reorganization, moratorium, or similar Laws
affecting creditors' rights generally and to general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity
or at law). Except as set forth on Schedule 3(b)(ii)
with respect to such Buyer, the Buyer need not give any
notice to, make any filing with, or obtain any
authorization, consent, or approval of any Governmental
Authority or any Person in order to consummate the
transactions contemplated by this Agreement.
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(iii) Noncontravention. Except for the approvals and filings
specified in Section 3(b)(ii) or as set forth in
Schedule 3(b)(iii) with respect to such Buyer, neither
the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby,
will (A) violate any statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or
other restriction of any Governmental Authority to which
the Buyer is subject or any provision of its charter or
bylaws or (B) conflict with, result in a breach of,
constitute a default under, result in the acceleration
of, create in any Party the right to accelerate,
terminate, modify, or cancel, or require any notice,
approval or consent under any agreement, contract,
lease, license, instrument, or other arrangement to
which the Buyer is a party or by which it is bound or to
which any of its assets is subject, including the LLC
Agreement, except for such violations, defaults,
breaches, or other occurrences that do not, individually
or in the aggregate, have a Material Adverse Effect on
such Buyer or material adverse effect on the ability of
the Buyer to consummate the transactions contemplated by
this Agreement, except for any requirements that have
been specifically waived herein by Seller.
(iv) Brokers' Fees. The Buyer has no liability or obligation
to pay any fees or commissions to any broker, finder, or
agent with respect to the transactions contemplated by
this Agreement for which Seller could become liable or
obligated.
(v) Investment. The Buyer is not acquiring the Membership
Interest with a view to or for sale in connection with
any distribution thereof within the meaning of the
Securities Act. The Buyer, together with its directors
and executive officers and advisors, is familiar with
investments of the nature of the Membership Interest,
understands that this investment involves substantial
risks, has adequately investigated the Membership
Interest, and has substantial knowledge and experience
in financial and business matters such that it is
capable of evaluating, and has evaluated, the merits and
risks inherent in purchasing the Membership Interest,
and is able to bear the economic risks of such
investment.
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(vi) Financing. At Closing, the Buyer will have sufficient
immediately available funds (excluding financing tied
specifically to or secured primarily by the Membership
Interest) to enable it to make payment of the Purchase
Price at Closing without encumbrance or delay and
without causing the Buyer to become insolvent or to
declare insolvency.
(vii) Litigation. There is no litigation pending against
either of the Buyers or any of their respective
Affiliates that seeks to modify or prevent the
consummation of any of the transactions or related
agreements contemplated herein.
(c) Disclaimer of Representations and Warranties Concerning
Membership Interest. Each Buyer acknowledges that (a) it has
had and pursuant to this Agreement will have before Closing
reasonable access to the Seller (with respect to the
Membership Interest) and the officers and employees of the
Seller, and (b) in making the decision to enter into this
Agreement and consummate the transactions contemplated hereby,
the Buyer has relied solely on the basis of its knowledge of
Centennial and the Centennial Assets by virtue of its status
as a member of Centennial, its own independent investigation
and upon the express representations, warranties, covenants,
and agreements set forth in this Agreement. Accordingly, each
Buyer acknowledges that, except as expressly set forth in this
Agreement or in other written agreements, the Seller has not
made, and THE SELLER MAKES NO AND DISCLAIMS ANY REPRESENTATION
OR WARRANTY, WHETHER EXPRESS OR IMPLIED, WHETHER BY COMMON
LAW, STATUTE, OR OTHERWISE, REGARDING SELLER'S MEMBERSHIP
INTEREST OR ANY OF THE CENTENNIAL ASSETS REPRESENTED BY SUCH
MEMBERSHIP INTEREST, INCLUDING (i) THE QUALITY, CONDITION, OR
OPERABILITY OF ANY PERSONAL PROPERTY, EQUIPMENT, OR FIXTURES,
(ii) ITS MERCHANTABILITY, (iii) ITS FITNESS FOR ANY PARTICULAR
PURPOSE, OR (iv) ITS CONFORMITY TO MODELS, SAMPLES OF
MATERIALS OR MANUFACTURER DESIGN. Nothing in this Agreement,
including this Section 3(c), shall modify or terminate any
representation or warranty made by Seller or any of its
Affiliates or former Affiliates to Buyers, their Affiliates or
Centennial, in other written agreements or in connection with
other transactions, including without limitation, that certain
Formation Agreement dated as of August 10, 2000 by and among
PEPL, MAP and TEPPCO.
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4. Pre-Closing Covenants. The Parties agree as follows with respect to the
period between the date of this Agreement and the Closing:
(a) General. Each Party will use its reasonable commercial efforts
to take all action and to do all things necessary, proper, or
advisable in order to consummate and make effective the
transactions contemplated by this Agreement.
(b) Notices and Consents. The Seller will give any notices to
third parties and will use its reasonable commercial efforts
to obtain any third party consents necessary for the
consummation of the transaction contemplated by this
Agreement. Each of the Parties will (and the Seller will and
each Buyer will cause its Affiliates to) give any notices to,
make any filings with, and use its reasonable commercial
efforts to obtain any authorizations, consents, and approvals
of Governmental Authorities or any Persons in connection with
the matters referred to in Section 3(a)(ii), Section 3(b)(ii)
and Section 4(b) so as to permit the Closing to occur by
February 14, 2003, or as soon thereafter as possible. The
Parties shall cooperate in the preparation of any filings
required to be made with any Governmental Agency in connection
with the transaction contemplated hereby.
(c) Full Access. The Seller will permit representatives of each
Buyer to have full access at all reasonable times, and in a
manner so as not to interfere with the normal business
operations of the Seller to all premises, properties,
personnel, books, records, contracts, and documents of or
pertaining to Seller's Membership Interest. Any information
obtained by a Buyer, its employees, representatives,
consultants, attorneys, agents, lenders and other advisors
under this Section 4(c) shall be considered and held
confidential. All "due diligence" activities of the Buyers
shall be conducted in accordance with applicable Laws and each
Buyer shall indemnify the Seller and its Affiliates from and
against all damages, losses and liabilities incurred as a
result of such Buyer's negligence or willful misconduct in the
conduct of such activities.
(d) Waiver of Buyers' Rights Under LLC Agreement. For the purposes
of this transaction only, each Buyer hereby waives its rights
under Section 10.04 of the LLC Agreement and hereby agrees
that the sale and purchase of Seller's Membership Interest is
to be consummated and governed by this Agreement.
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(e) Cash Calls. Each Buyer acknowledges that there are no
outstanding calls for capital contributions to be made by the
members of Centennial as of January 16, 2003. Subject to
Section 8(b) below, as of the date hereof, Seller shall be
relieved, and each of the Buyers shall cause Centennial to
relieve Seller, of any obligation to make any further capital
contributions to Centennial.
(f) Centennial Debt. Each Buyer shall use reasonable commercial
efforts to obtain the release of PEPL from its obligations as
Guarantor of the Centennial Project Debt with Prudential
Insurance Company of America ("Prudential") effective as of
the Closing Date or as soon thereafter as possible. From the
Closing Date until Prudential has advised PEPL that it has
been released of its obligations as Guarantor, each of the
Buyers, individually and limited to the extent of their
Post-Closing Membership Interest in Centennial, agrees to
defend and indemnify and hold PEPL harmless for all Adverse
Consequences, including without limitation the payment of
principal, interest and penalties and credit fees, if any,
incurred by PEPL as such Guarantor from and after the Closing
Date except to the extent such payments relate to matters
occurring prior to the Closing Date. Subject to Section 8(b)
below, as of the date of execution of this Agreement, PEPL and
its parent and Affiliates shall be relieved of their
responsibilities to make credit support payments to either of
the Buyers.
(g) Conduct of Business. Except as expressly provided elsewhere in
this Agreement, Seller agrees not (i) to sell transfer, pledge
or otherwise dispose of or encumber its Membership Interest;
(ii) to cancel or compromise any of the Centennial Project
Debt; (iii) other than voting its Membership Interest in any
action to come before the Centennial Board of Managers, to
take any action on behalf of or in the name of Centennial; or
(iv) to agree to do any of the foregoing.
(h) Maintenance Agreement. Seller shall cause its Affiliate CMS
Trunkline Gas Company ("Trunkline") and MAP shall cause its
Affiliate Marathon Ashland Pipe Line LLC ("MAPL") to execute
an amendment to the Maintenance Agreement dated May 4, 2001
between Trunkline and MAPL ("Maintenance Agreement") in the
form of Exhibit 4(h) hereto.
5. Post-Closing Covenants. The Parties agree as follows:
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(a) General. If at any time after the Closing any further action
is necessary to carry out the purposes of this Agreement, each
of the Parties will take such further action (including the
execution and delivery of such further instruments and
documents) as the other Party reasonably may request, all at
the sole cost and expense of the requesting Party (unless the
requesting Party is entitled to indemnification therefor under
Section 7).
(b) Litigation Support. In the event and for so long as any Party
actively is contesting or defending against any action, suit,
proceeding, hearing, investigation, charge, complaint, claim,
or demand in connection with (i) any transaction contemplated
under this Agreement or (ii) any fact, situation,
circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or
transaction on or before the Closing Date involving Centennial
or any of the Centennial Assets, the other Parties shall
cooperate with the contesting or defending Party and its
counsel in the defense or contest, make available its
personnel, and provide such testimony and access to its books
and records (other than books and records which are subject to
privilege or to confidentiality restrictions) as shall be
necessary in connection with the defense or contest, all at
the sole cost and expense of the contesting or defending Party
(unless the contesting or defending Party is entitled to
indemnification therefor under Section 7 or is adverse to such
other Party or Parties).
(c) Surety Bonds; Other Guarantees. In addition to the obligation
of the Buyers with respect to the Centennial Project Debt as
provided in Section 4(f) above, each of the Buyers or their
Affiliates, individually and limited to the extent of their
Post-Closing Membership Interest in Centennial, agrees to be
substituted as the surety or guarantor of those surety bonds
or other guarantees listed on Schedule 5(c), as well as any
other surety bonds or other guarantees as properly authorized
by Centennial, issued by the Seller or any of its Affiliates
with respect to Centennial or the Centennial Assets, effective
as of the Closing Date, but such substitution as surety or
guarantor shall not encompass any claims, obligations or
liabilities that may arise with respect to matters or events
occurring prior to the Closing Date under such surety bonds or
other guarantees. Buyers and Seller shall cooperate to effect
all such substitutions and each Buyer shall indemnify and hold
Seller and its Affiliates harmless from and against any
Adverse Consequences arising from and after the Closing due to
the failure of such Buyer or its Affiliate to be so
substituted.
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(d) Reimbursement Agreement. Each of the Buyers agrees to vote its
membership interest in support of the compliance by Centennial
with its obligation, pursuant to the existing terms and
conditions of the Reimbursement Agreement between Centennial
and Trunkline dated August 10, 2000, to reimburse Trunkline
for the agreed costs associated with the abandonment of
Trunkline's 26-inch natural gas pipeline subsequently
contributed to Centennial.
(e) Confidentiality Agreement. Upon consummation of the
transactions contemplated by this Agreement, Seller agrees
that it and its Affiliates and employees will maintain in
confidence and not use any and all information relating to
Centennial or its assets or operations, except for such
information as becomes public knowledge through no breach of
this or any other confidentiality undertaking or information
that it is required to be disclosed by Law or by order of a
Governmental Authority. Seller shall treat, and shall cause
its Affiliates and employees to treat, such confidential
information in the same manner as it treats its own
confidential business information.
(f) Records. On or as promptly as practicable after the Closing
Date, Seller shall, and shall cause its Affiliates to, deliver
to the Buyers or Centennial as the case may be, all records in
the possession of Seller or its Affiliates pertaining to the
operation of Centennial other than those Seller is required to
retain by law or for audit purposes. Seller shall maintain the
records which are not included in the records delivered to the
Buyers, and will make such records reasonably available,
without charge, to the Buyers at a reasonable place and time.
The Buyers shall be entitled to make copies thereof (at
Buyers' cost) as they shall deem necessary for purposes of
making such records available to appropriate Governmental
Authorities or for other proper corporate purposes in
connection with this Agreement or Centennial's business. As a
condition to such access, review and copying, Seller may
require that the Buyers keep all such records and data
contained therein confidential in the same manner as such
company would keep similar records of its own. Notwithstanding
the foregoing, Seller shall not be obligated to make available
any such records that are privileged or that Seller is
prohibited from disclosing by law.
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(g) Right-of-Way Records. As soon as reasonably practicable after
the Closing Date, but in no event later than May 1, 2003,
Seller agrees to provide the Buyers and Centennial,
collectively, with (i) a copy of all right-of-way records,
including applicable easements and assignments, pertaining to
or affecting the Shared Rights-of-Way (as such term is defined
in the "Conveyance, Assignment and ▇▇▇▇ of Sale" from
Trunkline Pipeline Holdings, Inc. (predecessor in interest to
Seller) to Centennial effective as of April 2, 2001), and (ii)
the originals of all right-of-way records, including
applicable easements and assignments, pertaining to or
affecting the Exclusive Rights-of-Way (as such term is defined
in the aforementioned "Conveyance, Assignment and ▇▇▇▇ of
Sale"), to the extent such records are within the possession
and control of Seller or any of its Affiliates. Seller agrees
to provide the Buyers and Centennial, collectively, with
copies of any future amendments, extensions and renewals and
other changes and modifications (collectively, "Changes") to
or of any documents affecting the Shared Rights-of-Way as soon
as reasonably practicable following such Changes. Seller and
the Buyers and Centennial, collectively, shall cooperate and
endeavor to agree as to the manner and process by which the
records are to be copied and provided. Seller shall have the
right to use an outside contractor for such purpose, provided
that the selection of such contractor shall be subject to the
reasonable approval of the Buyers and Centennial,
collectively. The Buyers agree, or agree to cause Centennial,
to reimburse Seller or its designated Affiliate for Seller's
or its Affiliate's reasonable costs and expenses, including
its internal costs, incurred in copying or otherwise incurred
in providing such records within fifteen (15) days from their
receipt of an invoice for such costs and expenses. Buyers
agree, and will cause their Affiliates and Centennial and
employees to agree, to treat and maintain such records in the
same manner as they maintain their own right-of-way records.
Seller and the Buyers and Centennial, collectively, agree to
advise the other party of any issues, claims or controversies
alleged by Governmental Entities or Persons concerning the
Shared-Rights-of-Way and within the knowledge of such Party or
its Affiliates. Buyers further agree, and will cause their
Affiliates and Centennial and employees to agree, not to
initiate any conversations, discussions or negotiations of any
kind or nature with any landowner or other interest owner of
any of the properties covered by the Shared Rights-of-Way so
long as Trunkline or another Affiliate of Seller is
maintaining the Shared Rights-of-Way on behalf of Centennial
or its operator, without the express prior consent of Seller
or such Affiliate, which consent shall not
14
unreasonably be withheld. By January 31 of each year following
the Closing, or as soon thereafter as the required information
is available to Seller, Seller or its Affiliate agrees to
furnish the Buyers and Centennial, collectively, with a
certificate from one of its authorized officials certifying
that to the best of Seller's or such Affiliate's knowledge,
information and belief, all payments of any kind required to
have been paid during the previous calendar year in order to
maintain the validity and efficacy of the Shared Rights-of-Way
have been made. The Parties acknowledge and agree that nothing
in this subparagraph (g) shall be deemed (i) to affect any of
the rights and obligations of any of the Parties or of
Centennial, or any of their successors and permitted assigns,
pursuant to Section 11.7 of the Formation Agreement dated
August 10, 2000, or (ii) to enlarge or otherwise affect or
alter any of the "Assigned Rights in Shared Rights-of-Way" (as
such term is defined in the aforementioned "Assignment, ▇▇▇▇
of Sale and Conveyance") granted Centennial thereunder. To the
extent any of Seller's obligations under this subparagraph (g)
are duplicative of any of the obligations of Trunkline under
the Maintenance Agreement and/or any other agreements between
Trunkline and MAPL affecting the Maintenance Agreement while
the Maintenance Agreement and/or such agreements are in
effect, the performance of Seller or its Affiliate under this
subparagraph (g) or under the Maintenance Agreement and/or
such other agreements shall be deemed performance under all
such agreements.
6. Conditions to Obligation to Close.
(a) Conditions to Obligation of the Buyers. The obligation of the
Buyers to consummate the transactions to be performed by it in
connection with the Closing is subject to satisfaction of the
following conditions:
(i) the representations and warranties of the Seller
contained in Section 3(a) shall be true and correct as
of the date of this Agreement and as of the Closing Date
(except to the extent expressly made as of a specific
date), except to the extent that any failures of such
representations and warranties to be so true and
correct, in the aggregate, would not have a Material
Adverse Effect on Seller or Centennial or a material
adverse effect on the ability of the Seller to
consummate the transactions contemplated hereby;
(ii) the Seller shall have performed and complied with all of
its
15
covenants hereunder in all material respects through the
Closing;
(iii) there shall not be any injunction, judgment, order,
decree, ruling, or charge in effect preventing
consummation of any of the transactions contemplated by
this Agreement, nor shall there be any litigation
pending on behalf of any Governmental Authority that
seeks to modify or prevent the consummation of the
transactions contemplated herein;
(iv) any and all required prior partnership approvals or
approvals of any Governmental Authority or Person or
otherwise called for in Schedules 3(a)(ii), 3(a)(iii),
3(b)(ii) and 3(b)(iii) shall have been received;
(v) any and all required prior partnership approvals or
approvals of the Board of Directors or Board of Managers
of each of the Buyers shall have been obtained;
(vi) To the extent provided for under applicable law, Seller
shall have delivered to Buyers certificates or other
writings issued by appropriate Governmental Authorities
evidencing that all applicable state franchise and
similar taxes have been paid in the states of Delaware,
Texas and Illinois;
(vii) The deliveries called for by Section 2(d) shall have
occurred;
(viii) Trunkline shall have executed an amendment to the
Maintenance Agreement as contemplated in Section 4(h)
hereof in the form of Exhibit 4(h) hereto and delivered
same to Buyers.
(ix) The Seller shall have delivered to the Buyers any
required consent of Southern Union Panhandle Corp. as
contemplated by Section 3(a)(ii) for the transactions
contemplated by this Agreement, specifically including
the amendment the Maintenance Agreement, in form
satisfactory to the Buyers; and
(x) The Seller shall have delivered to the Buyers a
certificate, signed by an appropriate officer of Seller,
to the effect that (a) each of the conditions specified
in subsection 6(a)(i) through 6(a)(ix) has been
satisfied in all respects, and (b) certifying as to the
accuracy and completeness of the copies of, as well as
the current effectiveness
16
of, the resolutions attached thereto as the approval by
the Board of Managers of Seller authorizing the
execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated
herein and the incumbency of the officer executing this
Agreement on behalf of Seller and any other documents to
be executed at the Closing.
Each Buyer may waive on its own behalf any condition specified
in this Section 6(a) if it executes a writing so stating at or
before the Closing.
(b) Conditions to Obligation of the Seller. The obligation of the
Seller to consummate the transactions to be performed by it in
connection with the Closing is subject to satisfaction of the
following conditions:
(i) the representations and warranties of each Buyer
contained in Section 3(b) shall be true and correct as
of the date of this Agreement and as of the Closing Date
(except to the extent expressly made as of a specific
date), except to the extent that any failures of such
representations and warranties to be so true and
correct, in the aggregate, would not have a material
adverse effect on the ability of such Buyer to
consummate the transactions contemplated hereby;
(ii) each Buyer shall have performed and complied with all of
its covenants hereunder in all material respects through
the Closing;
(iii) there shall not be any injunction, judgment, order,
decree, ruling, or charge in effect preventing
consummation of any of the transactions contemplated by
this Agreement, nor shall there be any litigation
pending on behalf of any Governmental Authority that
seeks to modify or prevent the consummation of the
transactions contemplated herein;
(iv) any and all required prior approvals of any Governmental
Authority or Person or otherwise called for in Schedules
3(a)(ii), 3(a)(iii), 3(b)(ii) and 3(b)(iii) shall have
been received;
(v) any and all required prior approvals of the Board of
Managers of Seller shall have been obtained;
17
(vi) the deliveries called for by Section 2(d) shall have
occurred;
(vii) MAPL shall have executed an amendment to the Maintenance
Agreement as contemplated in Section 4(h) hereof in the
form of Exhibit 4(h) hereto and delivered same to
Seller;
(viii) each Buyer shall have delivered to Seller a
certificate, signed by an appropriate officer of such
Buyer, to the effect that (a) each of the conditions
specified in subsection 6(b)(i) through 6(b)(vii) as
applicable to such Buyer has been satisfied in all
respects, and (b) certifying as to the accuracy and
completeness of the copies of, as well as the current
effectiveness of, the resolutions attached thereto as
the approval by the Board of Directors or Board of
Managers, as applicable, of such Buyer authorizing the
execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated
herein and the incumbency of the officers executing this
Agreement on behalf of such Buyer and any other
documents to be executed at the Closing.
The Seller may waive any condition specified in this Section 7(b) if it executes
a writing so stating at or before the Closing.
7. Remedies for Breaches of this Agreement.
(a) Survival of Representations, Warranties and Certain Covenants.
All of the representations and warranties of the Seller
contained in Section 3 (other than Section 3(a)(v)) shall
survive the Closing hereunder for a period of 18 months after
the date of the Closing; and the representations and
warranties in Section 3(a)(v) shall survive the Closing
indefinitely. The representations and warranties of the Buyers
contained in Section 3 shall survive the Closing for a period
of 18 months after the date of the Closing. Except as
otherwise provided herein, the covenants contained in this
Agreement to be performed after the Closing shall survive the
Closing indefinitely.
18
(b) Indemnification Provisions for Benefit of the Buyers.
(i) Subject to the provisions of Section 7(a), in the event
the Seller breaches any of its representations,
warranties, and covenants contained in this Agreement,
the Seller agrees to indemnify each of the Buyers from
and against any Adverse Consequences to the extent they
are caused proximately by any such breach and suffered
by the Buyers before, during and after the date of the
claim for indemnification; provided, however, that
Seller shall have no obligation to indemnify Buyers from
any such Adverse Consequences unless a bona fide written
claim for indemnification pursuant to Section 9(g) is
delivered to Seller during the 18-month period after the
date of the Closing, except with respect to claims for
indemnification with respect to the representation and
warranties in Section 3(a)(v) for which there shall be
no time limitations;
(ii) Except for the rights of indemnification provided in
this Section 7, the Buyers hereby waive any claim or
cause of action pursuant to common or statutory law or
otherwise against the Seller or its parent or Affiliates
regarding obligations and liabilities of any nature
whatsoever that are attributable to the transfer of the
Membership Interest pursuant to this Agreement, whether
arising before or after the Closing Date.
(c) Indemnification Provisions for the Benefit of the Seller. Subject to
the provisions of Section 7(a), in the event a Buyer breaches any of
its representations, warranties and covenants contained herein, that
the Buyer agrees to indemnify the Seller from and against any
Adverse Consequences caused proximately by the breach and suffered
by the Seller before, during or after the date of the claim for
indemnification; provided however, that Buyers shall have no
obligation to indemnify Sellers from any such Adverse Consequences
unless a bona fide written claim for indemnification is delivered to
Buyers in accordance with Section 9(g) during the 18-month period
after the date of the Closing.
19
(d) Matters Involving Third Parties.
(i) If any third party shall notify any Party (the
"Indemnified Party") with respect to any matter (a
"Third Party Claim") that may give rise to a claim for
indemnification against any other Party (the
"Indemnifying Party") under this Section 7, then the
Indemnified Party shall promptly notify the Indemnifying
Party thereof in writing;
(ii) The Indemnifying Party will have the right to assume and
thereafter conduct the defense of the Third Party Claim
with counsel of its choice reasonably satisfactory to
the Indemnified Party; provided, however, that the
Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement with respect to
the Third Party Claim without the prior written consent
of the Indemnified Party (not to be withheld
unreasonably) unless the judgment or proposed settlement
involves only the payment of money damages and does not
impose an injunction or other equitable relief upon the
Indemnified Party;
(iii) Unless and until the Indemnifying Party assumes the
defense of the Third Party Claim as provided in
subsection 7(d)(ii), the Indemnified Party may defend
against the Third Party Claim in any manner it
reasonably may deem appropriate; and
(iv) In no event will the Indemnified Party consent to the
entry of any judgment or enter into any settlement with
respect to the Third Party Claim without the prior
written consent of the Indemnifying Party which consent
shall not be withheld unreasonably.
(e) Determination of Amount of Adverse Consequences. The Adverse
Consequences giving rise to any indemnification obligation
hereunder shall be limited to the actual loss suffered by the
Indemnified Party (i.e., reduced by any insurance proceeds or
other payment or recoupment received, realized or retained by
the Indemnified Party as a result of the events giving rise to
the claim for indemnification net of any expenses related to
the receipt of such proceeds, payment or recoupment, including
retrospective premium adjustments, if any). Upon the request
of the Indemnifying Party, the Indemnified Party shall provide
the Indemnifying Party with information sufficient to allow
the Indemnifying Party to
20
calculate the amount of the indemnity payment in accordance
with this Section 7(e). An indemnified party shall take all
reasonable steps to mitigate damages in respect of any claim
for which it is seeking indemnification and shall use
reasonable best efforts to avoid any costs or expenses
associated with such claim and, if such costs and expenses
cannot be avoided, to minimize the amount thereof.
8. Termination.
(a) Termination of Agreement. The Parties may terminate this
Agreement as provided below:
(i) The Buyers and the Seller may terminate this Agreement
by mutual written consent of all Parties at any time
before the Closing;
(ii) Either Buyer may terminate this Agreement by giving
written notice to the Seller at any time before Closing
in the event the Seller has breached any representation,
warranty or covenant contained in this Agreement in any
material respect, the Buyer has notified the Seller of
the breach, the breach has continued without cure for a
period of 10 days after the notice of breach and such
breach would result in a failure to satisfy a condition
to Buyer's obligation to consummate the transactions
contemplated hereby;
(iii) The Seller may terminate this Agreement by giving
written notice to the Buyers at any time before the
Closing in the event a Buyer has breached any
representation, warranty or covenant contained in this
Agreement in any material respect, the Seller has
notified the Buyer of the breach, the breach has
continued without cure for a period of 10 days after the
notice of breach and such breach would result in a
failure to satisfy a condition to Seller's obligation to
consummate the transactions contemplated hereby;
(iv) Either of the Buyers or the Seller may terminate this
Agreement if any court of competent jurisdiction or any
governmental, administrative or regulatory authority,
agency or body shall have issued an order, decree or
ruling or shall have taken any other action permanently
enjoining, restraining or otherwise prohibiting the
transactions contemplated hereby and such order, decree,
ruling or other action shall have become final and
nonappealable; or
21
(v) Either of the Buyers or the Seller may terminate this
Agreement if Closing has not occurred by March 1, 2003
(unless the Parties agree to extend such date, in which
event, by such extended date), unless such failure to
close by such date is due to the breach by the Party
seeking to terminate of any of its representations,
warranties or covenants under this Agreement.
(b) Effect of Termination. If any Party terminates this Agreement
pursuant to Section 8(a), all rights and obligations of the
Parties hereunder shall terminate without any liability of any
Party to any other Party (except for any liability of any
Party then in breach); provided however, that the
confidentiality provisions agreed to herein shall survive
termination. In the event of a termination, all of Seller's or
its Affiliates' obligations to the Buyers or Centennial,
including without limitation, the making of capital
contributions, or the payment of credit support payments,
shall be reinstated retroactive to January 16, 2003 and Seller
shall make such payments within five business days after the
termination of this Agreement. Likewise, the Buyers'
agreements herein to assume any obligations of Seller or its
Affiliates and to indemnify and defend Seller and its
Affiliates with respect thereto shall terminate as of the
effective dates of such undertakings and shall be of no force
or effect. If, prior to the termination of this Agreement, any
payments are made or other obligations undertaken by either
Buyer in conjunction with such assumed obligations or
agreements to defend and indemnify, Seller shall promptly upon
such termination assume all such obligations and agreements
and shall promptly reimburse the Buyers within five business
days after the termination of this Agreement. Likewise, in
such event, the release of Seller, PEPL, their parents and
Affiliates of any obligations or responsibilities to make
payments or otherwise shall be terminated as of the effective
date of such release and shall be of no force and effect.
9. Miscellaneous.
(a) No Joint Liability. The rights, entitlements and obligations of the
Buyers shall be several, and not joint or joint and several, and
shall be in the ratio of their Post-Closing Membership Interest in
Centennial.
(b) Press Releases and Public Announcements. No Party shall issue any
press release or make any public announcement relating to the
subject matter of this Agreement before the Closing without the
prior written approval of
22
the other Parties; provided that any Party may make any public
disclosure it believes in good faith is required by applicable Law
or any listing or trading agreement concerning its publicly traded
securities (in which case the disclosing Party will use its
reasonable best efforts to advise the other Parties before making
the disclosure).
(c) No Third Party Beneficiaries. Except as specifically provided
herein, this Agreement shall not confer any rights or remedies
upon any Person other than the Parties and their respective
successors and permitted assigns.
(d) Succession and Assignment. This Agreement shall be binding
upon and inure to the benefit of the Parties named herein and
their respective successors and permitted assigns. No Party
may assign either this Agreement or any of its rights,
interests or obligations hereunder without the prior written
approval of the other Parties, except that a Buyer may assign
its rights hereunder to an Affiliate, provided that such Buyer
shall continue to be responsible and liable for its
obligations hereunder.
(e) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original but which together
will constitute one and the same instrument.
(f) Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way
the meaning or interpretation of this Agreement.
(g) Notices. All notices, requests. demands, claims, and other
communications hereunder will be in writing. Any notice,
request, demand, claim, or other communication hereunder shall
be deemed duly given two business days after it is sent by
registered or certified mail, return receipt requested,
postage prepaid, and addressed to the intended recipient as
set forth below:
If to the Seller: CMS Panhandle Holdings, LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
With a copy to:
CMS Gas Transmission Company
Fairlane Plaza North
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
23
If to either or both Buyers:
Marathon Ashland Petroleum LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: Vice President, Business Development
-- and --
TE Products Pipeline Company, LP
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President and CEO
Any Party may send any notice, request, demand, claim, or
other communication hereunder to the intended recipient at the
addresses set forth above using any other means (including
personal delivery, expedited courier, messenger service,
telecopy, facsimile, ordinary mail, or electronic mail), but
no such notice, request, demand, claim, or other communication
shall be deemed to have been duly given unless and until it
actually is received by the intended recipient. Any Party may
change the address to which notices, requests, demands,
claims, and other communications hereunder are to be delivered
by giving the other Party notice in the manner herein set
forth.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic Laws of the state of
Delaware without giving effect to any choice or conflict of
law provision or rule (whether of the state of Delaware or any
other jurisdiction) that would cause the application of the
Laws of any jurisdiction other than the state of Delaware.
(i) Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing
and signed by the Buyers and the Seller. No waiver by any
Party of any default, misrepresentation, or breach of warranty
or covenant hereunder, whether intentional or not, shall be
deemed to extend to any prior or subsequent default,
misrepresentation, or breach of warranty or covenant hereunder
or affect in any way any rights arising by virtue of any prior
or subsequent such occurrence
(j) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction
shall not affect the validity or enforceability of the
remaining terms and provisions hereof or
24
the validity or enforceability of the offending term or
provision in any other situation or in any other jurisdiction.
(k) Transaction Expenses. Each of the Buyer and the Seller will
bear its own costs and expenses (including legal fees and
expenses) incurred in connection with this Agreement and the
transactions contemplated hereby.
(l) Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the
Parties and no presumption or burden of proof shall arise
favoring or disfavoring any Party by virtue of the authorship
of any of the provisions of this Agreement. Any reference to
any federal, state, local, or foreign statute or Law shall be
deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word
"including" shall mean including without limitation.
(m) Incorporation of Exhibits and Schedules. The Exhibits and
Schedules identified in this Agreement are incorporated herein
by reference and made a part hereof.
(n) ENTIRE AGREEMENT. THIS AGREEMENT (INCLUDING THE DOCUMENTS
REFERRED TO HEREIN) CONSTITUTES THE ENTIRE AGREEMENT AMONG THE
PARTIES AND SUPERSEDES ANY PRIOR UNDERSTANDINGS, AGREEMENTS,
OR REPRESENTATIONS BY OR AMONG THE PARTIES, WRITTEN OR ORAL,
WITH RESPECT TO THE SUBJECT MATTER HEREOF.
25
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
CMS PANHANDLE HOLDINGS, LLC
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Title: President
-----------------------------------
MARATHON ASHLAND PETROLEUM LLC
By: /s/ A. R. ▇▇▇▇▇▇
--------------------------------------
Name: A.R. ▇▇▇▇▇▇
------------------------------------
Title: Vice President Business Development
-----------------------------------
TE PRODUCTS PIPELINE COMPANY, LIMITED
PARTNERSHIP
By: TEPPCO GP, Inc.,
Its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title:: Senior Vice President
----------------------------------
26
EXHIBIT 2(d)
ASSIGNMENT AND CONVEYANCE
THIS ASSIGNMENT AND CONVEYANCE, made and entered into effective as of the
_____day of __________________, 2003, by and between CMS PANHANDLE HOLDINGS,
LLC, a Delaware limited liability company ("ASSIGNOR") and TE PRODUCTS PIPELINE
COMPANY, LIMITED PARTNERSHIP, a Delaware limited partnership ("ASSIGNEE").
W-I-T-N-E-S-S-E-T-H
WHEREAS, ASSIGNOR'S predecessor in interest Panhandle Eastern Pipe Line
Company, ASSIGNEE and Marathon Ashland Petroleum LLC ("Marathon") are parties to
that certain Amended and Restated Limited Liability Company Agreement of
Centennial Pipeline LLC dated August 10, 2000 (the "Centennial LLC Agreement");
and
WHEREAS, ASSIGNOR, ASSIGNEE and Marathon are parties to that certain LLC
Membership Interest Purchase Agreement dated as of _______________________, 2003
pursuant to which ASSIGNOR agreed to sell its membership interest in Centennial
Pipeline, LLC ("Centennial") to ASSIGNEE and Marathon, in equal shares, and
ASSIGNEE and Marathon agreed to purchase such membership interest from ASSIGNOR;
and
WHEREAS, ASSIGNOR and ASSIGNEE desire to consummate the agreement of the
parties to the LLC Membership Interest Purchase Agreement with respect to the
share of ASSIGNOR's membership interest in Centennial to be sold to and
purchased by ASSIGNEE.
NOW, THEREFORE, for the consideration set forth and agreed to in the
aforesaid LLC Membership Interest Purchase Agreement, ASSIGNOR does by these
presents ASSIGN, TRANSFER AND CONVEY unto ASSIGNEE one-half of ASSIGNOR's 33
1/3% membership interest (or a total of 16 2/3%) in Centennial together with all
of ASSIGNOR'S rights, title, and interest associated with such share of such
membership interest (collectively "Membership Rights") pursuant to the
Centennial LLC Agreement.
TO HAVE AND TO HOLD the Membership Rights together with all other rights
thereunto belonging to ASSIGNEE, its successors and assigns.
ASSIGNEE hereby accepts and assumes, and agrees to perform all of
ASSIGNOR'S duties and obligations arising from and after the Effective Date
hereof under and with respect to the Membership Rights assigned hereunder.
This Assignment is being made pursuant to the LLC Membership Interest
Purchase Agreement referenced above. In addition to the express representations,
warranties, covenants and conditions set forth hereinabove, this Assignment
shall be subject to each of the representations, warranties, covenants and
conditions contained in said LLC Membership Interest Purchase Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Assignment
and Conveyance to be executed by its duly authorized official effective as of
the ______ day of _____________, 2003 ("Effective Date").
CMS PANHANDLE HOLDINGS, LLC
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
TE PRODUCTS PIPELINE COMPANY, LIMITED
PARTNERSHIP
By: TEPPCO GP, Inc. Its General Partner
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
2
EXHIBIT 2(d)
ASSIGNMENT AND CONVEYANCE
THIS ASSIGNMENT AND CONVEYANCE, made and entered into effective as of the
_____day of __________________, 2003, by and between CMS PANHANDLE HOLDINGS,
LLC, a Delaware limited liability company ("ASSIGNOR") and MARATHON ASHLAND
PETROLEUM LLC, a Delaware limited liability company ("ASSIGNEE").
W-I-T-N-E-S-S-E-T-H
WHEREAS, ASSIGNOR'S predecessor in interest Panhandle Eastern Pipe Line
Company, ASSIGNEE and TE Products Pipeline Company, Limited Partnership
("TEPPCO") are parties to that certain Amended and Restated Limited Liability
Company Agreement of Centennial Pipeline LLC dated August 10, 2000 (the
"Centennial LLC Agreement");
WHEREAS, ASSIGNOR, ASSIGNEE and TEPPCO are parties to that certain LLC
Membership Interest Purchase Agreement dated as of _______________________, 2003
pursuant to which ASSIGNOR agreed to sell its membership interest in Centennial
Pipeline, LLC ("Centennial") to ASSIGNEE and TEPPCO, in equal shares, and
ASSIGNEE and TEPPCO agreed to purchase such membership interest from ASSIGNOR;
and
WHEREAS, ASSIGNOR and ASSIGNEE desire to consummate the agreement of the
parties to the LLC Membership Interest Purchase Agreement with respect to the
share of ASSIGNOR's membership interest in Centennial to be sold to and
purchased by ASSIGNEE.
NOW, THEREFORE, for the consideration set forth and agreed to in the
aforesaid LLC Membership Interest Purchase Agreement, ASSIGNOR does by these
presents ASSIGN, TRANSFER AND CONVEY unto ASSIGNEE one-half of ASSIGNOR's 33
1/3% membership interest (or a total of 16 2/3%) in Centennial together with all
of ASSIGNOR's rights, title, and interest associated with such share of such
membership interest (collectively "Membership Rights") pursuant to the
Centennial LLC Agreement.
TO HAVE AND TO HOLD the Membership Rights together with all other rights
thereunto belonging to ASSIGNEE, its successors and assigns.
ASSIGNEE hereby accepts and assumes, and agrees to perform, all of
ASSIGNOR'S duties and obligations arising from and after the Effective Date
hereof under and with respect to the Membership Rights assigned hereunder.
This Assignment is being made pursuant to the LLC Membership Interest
Purchase Agreement referenced above. In addition to the express representations,
warranties, covenants and conditions set forth hereinabove, this Assignment
shall be subject to each of the representations, warranties, covenants and
conditions contained in said LLC Membership Interest Purchase Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Assignment
and Conveyance to be executed by its duly authorized official effective as of
the ______ day of _____________, 2003 ("Effective Date").
CMS PANHANDLE HOLDINGS, LLC
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
MARTHON ASHLAND PETROLEUM LLC
By: ________________________________________
Name: ______________________________________
Title: _____________________________________
2
EXHIBIT 4(h)
AMENDMENT TO MAINTENANCE AGREEMENT
THIS AMENDMENT, dated and effective as of the _____day of
___________________, 2003, between CMS TRUNKLINE GAS COMPANY, LLC, a Delaware
limited liability company, formerly known as Trunkline Gas Company ("TGC") and
MARATHON ASHLAND PIPE LINE, LLC, a Delaware limited liability company ("MAPL").
TGC and MAPL are at times hereinafter referred to individually as a "Party" and
collectively as "Parties".
WITNESSETH:
WHEREAS, TGC and MAPL are parties to that certain "Maintenance Agreement"
made and entered into as of May 4, 2001 (the "Maintenance Agreement"), pursuant
to which TGC agreed to maintain the Trunkline 26 portion of the Long Haul System
of the Centennial Line on behalf of MAPL, the Operator of the Centennial Line,
as those terms are defined in said Maintenance Agreement;
WHEREAS, TGC and MAPL executed a certain Memorandum of Understanding in
January 2002 (the "MOU") which further defined the scope of TGC's obligations
under the Maintenance Agreement; and
WHEREAS, pursuant to a "LLC Membership Interest Purchase Agreement"
entered into concurrently herewith among the members of Centennial Pipeline LLC,
which include affiliates of the Parties hereto, the parties to that agreement
have agreed on certain amendments to be made to the Maintenance Agreement: and
WHEREAS, the Parties hereto now desire to carry out the agreement of the
parties to said LLC Membership Interest Purchase Agreement and to that end do
hereby agree to amend the Maintenance Agreement as herein provided.
NOW THEREFORE, for and in consideration of the premises and the mutual
benefits, covenants and agreements herein contained, the Parties hereto agree as
follows:
1. Section 2.2 Term of the Maintenance Agreement shall be deleted in
its entirety and the following substituted therefor:
"2.2 Term. This Agreement shall run for a period which is the
shorter of the following: (a) the period during which TGC or one of
its Affiliates owns and operates one or more natural gas pipelines
on the Shared Rights-of-Way; or (b) the period during
which the Trunkline 26 remains in use and operation; or (c) the
period ending December 31, 2005 (the "Term"). The right of TGC to
maintain the Trunkline 26 portion of the Long Haul System pursuant
to this Agreement shall be binding on the successors and assigns of
MAPL, in its capacity as operator of the Trunkline 26 portion of the
Long Haul System."
2. Section 2.4(a) of the Maintenance Agreement shall be deleted in its
entirety and the following substituted therefor:
"(a) TGC shall neglect or fail to perform any or all of its
obligations under this Agreement or the MOU and after thirty
(30) days written notice of such default fails to rectify the
same; or"
3. The first sentence of Section 5.1 Fee of the Maintenance Agreement
shall be deleted in its entirety and the following substituted
therefor: "TGC shall be paid an annual fee (the "Fee") of Two
Million Five Hundred Thousand Dollars ($2,500,000) per year;
provided, that for the calendar years 2003, 2004 and 2005, the Fee
shall be Two Million Dollars ($2,000,000)."
4. Section 6.1 of the Maintenance Agreement shall be deleted in its
entirety and the following substituted therefor:
"6.1 (A) MAPL HEREBY AGREES TO RELEASE, INDEMNIFY, HOLD HARMLESS
AND DEFEND TGC AND THE COMPANY, THEIR RESPECTIVE AFFILIATES
AND THEIR RESPECTIVE OFFICERS, BOARD OF MANAGERS, DIRECTORS,
MEMBERS, EMPLOYEES, SUCCESSORS AND ASSIGNS FROM AND AGAINST
ANY AND ALL DAMAGES ARISING OUT OF, IN ANY WAY RELATING TO, OR
IN ANY DEGREE CAUSED BY THE OPERATION OF THE CENTENNIAL LINE,
EXCEPT FOR ANY SUCH DAMAGES ALLEGED TO RESULT FROM TGC'S
NEGLIGENCE OR WILLFUL MISCONDUCT, AND WHETHER OCCURRING AS THE
SOLE OR A CONCURRENT CAUSE OF AN ACT OR EVENT GIVING RISE TO
AN INDEMNITY OBLIGATION HEREUNDER. TGC AND MAPL AGREE THAT THE
INDEMNITY PROVIDED BY THIS SECTION IS TO BE CONSTRUED SO THAT
IT IS AS BROAD AS IS PERMISSIBLE BY LAW, AND IS SUBJECT ONLY
TO THOSE EXCEPTIONS AND LIMITATIONS REQUIRED FOR THIS
INDEMNITY TO BE AND REMAIN VALID UNDER APPLICABLE LAW.
2
(B) TGC HEREBY AGREES TO RELEASE, INDEMNIFY, HOLD HARMLESS AND
DEFEND MAPL, ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS,
BOARD OF MANAGERS, DIRECTORS, MEMBERS, EMPLOYEES, SUCCESSORS
AND ASSIGNS FROM AND AGAINST ANY AND ALL DAMAGES ARISING OUT
OF, IN ANY WAY RELATING TO, OR IN ANY DEGREE CAUSED BY THE
OPERATION OF THE LONG HAUL SYSTEM ALLEGED TO RESULT FROM TGC'S
NEGLIGENCE OR WILLFUL MISCONDUCT IN THE PERFORMANCE OF ITS
OBLIGATIONS UNDER THIS AGREEMENT, AND WHETHER OCCURRING AS THE
SOLE OR A CONCURRENT CAUSE OF AN ACT OR EVENT GIVING RISE TO
AN INDEMNITY OBLIGATION HEREUNDER. TGC AND MAPL AGREE THAT THE
INDEMNITY PROVIDED BY THIS SECTION IS TO BE CONSTRUED SO THAT
IT IS AS BROAD IN SCOPE AS IS PERMISSIBLE BY LAW, AND IS
SUBJECT ONLY TO THOSE EXCEPTIONS AND LIMITATIONS REQUIRED FOR
THIS INDEMNITY TO BE AND REMAIN VALID UNDER APPLICABLE LAW."
5. The first sentence of Section 6.8 Settlements of the Maintenance
Agreement shall be deleted in its entirety and the following
substituted therefor: "All Claims for Damages against MAPL (i)
arising out of or in any way relating to the Operation of the Long
Haul System and (ii) not discharged by insurance required hereunder
shall be defended by TGC, with the approval of MAPL, at the expense
of MAPL but no claim for Damages against MAPL or TGC shall be
settled by TGC for a sum in excess of Ten Thousand Dollars
($10,000), and no multiple claims for Damages against MAPL or TGC
shall be settled by TGC for a cumulative sum in excess of Twenty
Thousand Dollars ($20,000) without prior approval of MAPL or such
person or persons as may be authorized by MAPL to approve such
settlements.
6. Unless otherwise specifically provided herein, the capitalized terms
used in this Amendment shall have the same meaning ascribed to those
terms in the Maintenance Agreement.
7. This Amendment shall be effective as of the effective date of the
Assignment and Conveyance provided for in the above-referenced LLC
Membership Interest Purchase Agreement.
8. As amended hereby, the Maintenance Agreement shall remain in effect
according to its original terms
3
IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed
in multiple counterparts, each of which shall be an original but which when
taken together shall be deemed but one and the same instrument, effective as
provided herein.
CMS TRUNKLINE GAS COMPANY, LLC
By: ________________________________________
Title: _____________________________________
MARATHON ASHLAND PIPE LINE LLC
By: ________________________________________
Title: _____________________________________
4
SCHEDULES
SCHEDULE 3(a)(ii)
1. APPROVAL REQUIRED FROM SELLER'S BOARD OF MANAGERS.
2. APPROVAL REQUIRED FROM SOUTHERN UNION PANHANDLE CORP. FOR AMENDMENT TO
MAINTENANCE AGREEMENT AS CONTEMPLATED BY SECTION 4(H).
3. NOTICE REQUIRED TO PRUDENTIAL INSURANCE COMPANY OF AMERICA OF TRANSFER OF
SELLER'S MEMBERSHIP INTEREST.
SCHEDULES
SCHEDULE 3(a)(iii)
NONE.
SCHEDULES
SCHEDULE 3(b)(ii)
1. APPROVAL REQUIRED FROM TEPPCO'S BOARD OF DIRECTORS.
2. APPROVAL REQUIRED FROM MAP'S BOARD OF MANAGERS.
SCHEDULES
SCHEDULE 3(b)(iii)
1. NOTICE REQUIRED TO PRUDENTIAL INSURANCE COMPANY OF AMERICA OF TRANSFER
OF SELLER'S MEMBERSHIP INTEREST TO BUYERS.
SCHEDULES
SCHEDULE 5(c)
CENTENNIAL PIPELINE LLC
SAFECO INSURANCE COMPANY OF AMERICA
MASTER BOND LISTING
Bond No. Origin Expiration Bond Type Obligee
-------- ------ ---------- --------- -------
6070758 12/31/01 12/31/03 Permit ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ 12/15/00 12/15/03 Permit Orange County, Texas - Orange County Courthouse
Orange, Texas
6095688 04/05/01 04/05/03 Permit Illinois Department of Transportation
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ 06/29/01 06/29/03 Permit Commonwealth of Kentucky - Transportation Cabinet
District ▇▇▇▇▇▇ ▇▇. ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ 08/13/01 08/13/03 Court U.S. District Court of ▇▇▇▇▇▇ County, Texas
(Cost) ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇ 08/13/01 08/13/03 Court U.S. District Court of ▇▇▇▇▇▇ County, Texas
(Condemn- Beaumont, Texas
nation)
6169094 10/21/02 10/21/03 Tax State of Texas - Comptroller of Public Accounts
▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇ 10/21/02 10/21/03 Tax State of Texas - Comptroller of Public Accounts
▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇ 11/01/02 11/01/03 Tax Illinois Department of Revenue
Springfield, Illinois
Bond No. Amount Annual Premium Purpose State
-------- ------ -------------- ------- -----
6070758 $ 150,000.00 $ 262.50 Oversize/Overweight Loads on ▇▇▇▇▇▇ ▇▇▇▇▇/▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ $ 140,000.00 $ 560.00 Installation of Pipeline under Orange ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ $ 15,000.00 $ 45.00 26" Natural Gas Pipeline under Interstate ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ #▇ ▇▇
▇▇▇▇▇▇▇ $ 10,000.00 $ 45.00 Excavation/Encroachment within Kentucky ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇-▇▇▇ ▇▇
▇▇▇▇▇▇▇ $ 670.00 $ 60.00 Possession of condemned property of ▇. ▇. ▇▇▇▇▇▇, and the unknown
heirs, successors and assigns of ▇. ▇. ▇▇▇▇▇▇ TX
6127314 $ 670.00 $ 60.00 Possession of condemned property of ▇. ▇. ▇▇▇▇▇▇, and the unknown
heirs, successors and assigns of ▇. ▇. ▇▇▇▇▇▇ TX
6169094 $ 600,000.00 $2,400.00 Financial Responsibility for Tax as ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ $ 600,000.00 $2,400.00 Financial Responsibility for Tax as Gasoline ▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ $2,200,000.00 $3,850.00 Financial Responsibility for Tax as Gasoline Distributor IL
$3,716,340.00 $9,682.50
