EXHIBIT 10.3
CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT
This Contribution, Conveyance and Assumption Agreement,
dated as of December 17, 1996 is entered into by and among CORNERSTONE
PROPANE PARTNERS, L.P., a Delaware limited partnership (the "MLP"),
CORNERSTONE PROPANE, L.P., a Delaware limited partnership (the "OLP"),
CORNERSTONE PROPANE GP, INC., a California corporation formerly known
as Coast Gas, Inc. (the "MANAGING GP"), EMPIRE ENERGY SC CORPORATION,
a Delaware corporation ("SC"), and SYN INC., a Delaware corporation
("SYN"; the Managing GP, SC and SYN are sometimes referred to herein
individually as a "TRANSFEROR" and collectively as the "TRANSFERORS").
RECITALS
WHEREAS, Cornerstone Propane GP, Inc., a Delaware
corporation (the "OGP"), as general partner, and Northwestern Growth
Corporation, a South Dakota corporation ("NGC"), as organizational
limited partner, formed the MLP pursuant to the Delaware Revised
Uniform Limited Partnership Act (the "DELAWARE ACT");
WHEREAS, the OGP, as general partner, and the MLP, as
organizational limited partner, formed the OLP pursuant to the
Delaware Act;
WHEREAS, as part of the actions taken prior to the execution
of this Agreement, (i) certain of the Operating Subsidiaries (as
defined below) of Empire Energy Corporation, a Tennessee corporation
("EEC"), contributed to SC, then an indirect, wholly-owned subsidiary
of EEC, certain assets as a capital contribution and in exchange SC
assumed certain indebtedness to EEC which originally was incurred by
such subsidiaries in connection with their acquisition of such assets;
and, after the aforesaid capital contributions to SC and assumption of
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indebtedness by SC, the Operating Subsidiaries of EEC (other than SC)
merged with and into EEC; (ii) the Operating Subsidiaries of SYN
merged with and into SYN; (iii) NGC, the owner of all of the
outstanding capital stock of EEC, Xxxxx Propane Gas Company, a
Delaware corporation ("XXXXX"), and the OGP and certain common stock
of SYN, contributed to CGI Holdings, Inc., a Delaware corporation
("CGI Holdings"), then a wholly owned subsidiary of NGC, that stock
and certain property as a capital contribution and in exchange CGI
Holdings assumed certain indebtedness incurred by NGC in connection
with the acquisition of such stock and property; and (iv) after the
aforesaid capital contributions to CGI Holdings and assumption of
indebtedness by CGI Holdings, CGI Holdings contributed the stock and
property contributed to it, together with the outstanding capital
stock of Xxxxx Enterprises, Inc., a Nevada corporation ("PEI"), its
wholly-owned subsidiary, and the Acquired Businesses (as defined
below) to the Managing GP and in exchange the Managing GP assumed
certain indebtedness incurred in connection with the acquisition of
said stock and property and the Acquired Businesses;
WHEREAS, after the aforesaid contributions to capital and
assumptions of indebtedness, Coast Energy Group, Inc., a Delaware
corporation ("CEG"), PEI, EEC, Xxxxx and the OGP, all then wholly
owned subsidiaries of the Managing GP, merged with and into the
Managing GP and the Managing GP changed its name to Cornerstone
Propane GP, Inc., and as a result of all of the aforesaid
contributions to capital, mergers and assumptions of indebtedness, the
Managing GP became the successor to the business, assets and
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liabilities of CEG, PEI, EEC, Xxxxx and the OGP, including the general
partner interests in the MLP and the OLP formerly held by the OGP, and
the Acquired Businesses;
WHEREAS, immediately prior to the execution of this
Agreement, the Managing GP, as managing general partner, SYN, as
special general partner, and the MLP, as organizational limited
partner, entered into that certain Amended and Restated Agreement of
Limited Partnership of the OLP (the "OLP PARTNERSHIP AGREEMENT"), and
the Managing GP, as managing general partner, SYN, as special general
partner, and NGC, as organizational limited partner, entered into that
certain Amended and Restated Agreement of Limited Partnership of the
MLP (the "MLP PARTNERSHIP AGREEMENT");
WHEREAS, the Managing GP, SC and SYN desire, as contemplated
in the OLP Partnership Agreement, to contribute certain of their
respective assets as capital contributions to the OLP, and, as
contemplated in the MLP Partnership Agreement, to contribute the
limited partner interests each acquired in the OLP as a result of the
aforesaid contributions as capital contributions to the MLP, in each
case subject to the terms and conditions set forth below; and
WHEREAS, in connection with the transactions contemplated
below, the MLP is closing the Public Offering (as defined below) and
the OLP is closing the Note Offering (as defined below) and obtaining
certain loans and other financial accommodations under the Credit
Agreement (as defined below) to provide the funds and other financial
accommodations needed to consummate the transactions on the terms and
conditions set forth below;
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NOW, THEREFORE, in consideration of their mutual
undertakings and agreements hereunder, and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement undertake and agree as
follows:
1. DEFINITIONS.
1.1 General Terms. When used herein, the following
terms shall have the following meanings:
"Acquired Businesses" shall mean the business conducted by
CGI Acquisition with the assets acquired pursuant to (i) that certain
Agreement of Purchase and Sale of Assets dated October 11, 1996
between Antelope Valley Gas Company, Inc., a California corporation,
and CGI Acquisition and (ii) that certain Agreement of Purchase and
Sale of Assets dated December 2, 1996 between Xxxxxx Plumbing Inc., a
California corporation, and CGI Acquisition; and which business and
assets were acquired by CGI Holdings as a result of the merger of CGI
Acquisition with and into CGI Holdings.
"Additional Acquisition Documents" means, collectively, that
certain Asset Purchase Agreement dated as of July 25, 1995 between SYN
and EEC and all agreements and documents entered into in connection
with the acquisition contemplated therein, in each case as amended
from time to time.
"Affiliate" means, with respect to any Person, any other
Person that directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control
with, the Person in question. As used herein, the term "CONTROL"
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means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a Person,
whether through ownership of voting securities, by contract or
otherwise. Notwithstanding anything contained in this definition to
the contrary, the term Affiliate, (i) with respect to the OLP shall
mean only the MLP and the OLP Subsidiary and any Person directly or
indirectly controlled by the MLP, the OLP or the OLP Subsidiary, (ii)
with respect to the MLP shall mean only the OLP and the OLP Subsidiary
and any Person directly or indirectly controlled by the MLP, the OLP
or the OLP Subsidiary, and (iii) with respect to each Transferor shall
exclude the OLP, the MLP and all other Affiliates of the OLP and the
MLP.
"Agreement" means this Contribution, Conveyance and
Assumption Agreement, as amended, modified or supplemented from time
to time.
"ASG" means All Star Gas Corporation, a Missouri corporation
formerly known as Empire Gas Corporation.
"Assets" has the meaning assigned to such term in SCHEDULE
1.1 as applied to any individual Transferor and as applied to the
Transferors, collectively, means the Managing GP Assets, the SC Assets
and the SYN Assets.
"Assumed Additional Managing GP Debt" means the indebtedness
of the Managing GP, in the approximate amount of $4,100,000, under
certain capitalized leases relating to LPG tanks, bobtail trucks,
office equipment and certain other vehicles and equipment.
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"Assumed Additional SYN Debt" means the indebtedness of SYN,
in the approximate amount of $800,000, owed to Planters and Stockmen
Bank and the holders of certain mortgages with respect to SYN's
property.
"Assumed CGI Acquisition Debt" means the indebtedness
evidenced by that certain Amended and Restated Promissory Note dated
December 1, 1996 made by CGI Acquisition to the order of NGC in the
principal amount of $1,885,000, representing certain indebtedness
incurred by CGI Acquisition in connection with its acquisition of PEI
and the Acquired Businesses, which indebtedness was assumed by the
Managing GP as a result of the Related Transactions.
"Assumed EEC Debt" means the indebtedness of EEC (other than
the Excluded EEC Debt) under or in connection with that certain Credit
Agreement dated as of August 1, 1996 among EEC, certain subsidiaries
of EEC, the lenders from time to time parties thereto and The First
National Bank of Boston, as agent for such lenders, as amended to
date, and the "Credit Documents" referred to therein, including any
accrued interest and any premium, fees and other amounts which may
become payable in connection therewith, and which indebtedness was
assumed by the Managing GP as a result of the Related Transactions.
"Assumed L/C Facility" shall mean the Continuing Letter of
Credit Agreement dated August 28, 1992 between CEG and Banque Paribas,
as amended to date, the "Credits" referred to therein, the Continuing
Guaranty of the Corporation dated August 28, 1992 made by the Managing
GP in favor of Banque Paribas and the agreements and documents entered
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into with respect to the facilities provided to CEG referred to
therein.
"Assumed Liabilities" means as to any individual Transferor,
all of the liabilities or obligations of such Transferor, including
those to which the Transferor has succeeded, whether by contract,
merger or liquidation of its subsidiaries or otherwise, arising from
or relating to the Assets of such Transferor or the operation of the
Business of such Transferor, whether by such Transferor or its
predecessors (whether or not in the ordinary course), of every kind,
character and description, and (i) whether matured or unmatured, known
or unknown, fixed or contingent, or liquidated or unliquidated, (ii)
whether or not reflected on the books and records of such Transferor
as of the Effective Time, and (iii) regardless of whether asserted or
determined prior to, at or subsequent to the Effective Time; provided,
however, notwithstanding the foregoing, the Assumed Liabilities of any
Transferor shall not include any liabilities or obligations to the
extent that they constitute Excluded Liabilities of such Transferor;
and means as to the Transferors, collectively, all of the foregoing as
to all of the Transferors.
"Assumed Managing GP Debt" means, collectively, the
indebtedness of the Managing GP under or in connection with (i) that
certain Credit Agreement dated as of September 14, 1994 among the
Managing GP, CEG, the lenders from time to time parties thereto and
Bank of America, Illinois, as agent to the lenders, as amended to
date, and the "Loan Documents" referred to therein, including any
accrued interest and any premium, fees and other amounts which may
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become payable in connection therewith, (ii) the Securities Purchase
Agreement dated as of September 14, 1994 among the Managing GP, CEG,
CGI Holdings and the several buyers referred to therein, as amended to
date, with respect to the 12.05% Senior Secured Notes due December 15,
2004 issued by the Managing GP and the "Transaction Documents"
referred to therein, including any accrued interest and any premium,
fees and other amounts which may become payable in connection
therewith, and (iii) the Assumed L/C Facility, including any accrued
interest and any premium, fees and other amounts which may become
payable in connection therewith.
"Assumed NGC Debt" means, collectively, the indebtedness of
NGC under or in connection with (i) that certain Promissory Note dated
December 13, 1996 made by NGC to the order of ASG in the principal
amount of $18,000,000 and that certain Promissory Note dated
December 13, 1996 made by NGC to the order of Xxxx X. Xxxxxxx, Xx. in
the principal amount of $2,000,000, representing indebtedness incurred
in the connection with NGC's acquisition of, among other things, the
common stock of SYN and Xxxxx then owned by ASG and certain additional
rights; (ii) that certain Promissory Note dated as of October 7, 1996
made by NGC to the order of NPS in the principal amount of
$22,000,000, representing the aggregate amount of indebtedness
incurred by NGC in connection with NGC's acquisition of EEC, certain
indebtedness of EEC owed to a former stockholder of EEC and certain
rights of such stockholder against SYN under the Additional
Acquisition Documents; and (iii) that certain Promissory Note dated
December 16, 1996 made by NGC to the order of Xxxxx X. Xxxxxx, Xxxxxx
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Parsky and Xxxxxxx X. Xxxxxx in the principal amount of $37,026,658.42
representing indebtedness incurred in connection with NGC's
acquisition of CGI Holdings; and which indebtedness was assumed by the
Managing Partner as a result of the Related Transactions.
"Assumed SC Debt" means the indebtedness of SC under or in
connection with the SC Note.
"Assumed SYN Debt" means, collectively, the indebtedness of
SYN under or in connection with (i) that certain Term Loan Agreement
dated as of July 31, 1996 between SYN and NPS, as amended to date, and
the "Credit Documents" referred to therein, including any accrued
interest and any premium, fees and other amounts which may become
payable in connection therewith, and (ii) that certain Credit
Agreement dated as of December 28, 1995 among SYN, certain
subsidiaries of SYN named therein, the lenders from time to time
parties thereto and The First National Bank of Boston, as agent for
such lenders, as amended to date, and the "Credit Documents" referred
to therein, including any accrued interest and any premium, fees and
other amounts which may become payable in connection therewith.
"Business" means, with respect to any Transferor, the
businesses currently conducted by such Transferor and any that were
previously conducted by such Transferor or any of the subsidiaries of
such Transferor which were merged or liquidated into such Transferor,
in each case that are included among the following, namely, the sale
and distribution of natural gas, crude oil, natural gas liquids, LPG,
and other petroleum derived products, LPG storage and transportation
equipment, appliances, parts and fittings relating to the foregoing
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and transportation, storage, repair, labor and other services relating
to any of the foregoing.
"Case Handler" has the meaning assigned to such term in
Section 6.5.
"CEG" has the meaning assigned to such term in the Recitals
to this Agreement.
"CGI Acquisition" means CGI Acquisition Corporation, a
Delaware corporation which merged with and into CGI Holdings when NGC
acquired CGI Holdings.
"CGI Holdings" has the meaning assigned to such term in the
Recitals to this Agreement.
"Closing Date" means December 17, 1996 or such other date as
the parties may mutually agree.
"Commitments" has the meaning assigned to such term in
Section 3.2.
"Common Unit" has the meaning assigned to such term in the
MLP Partnership Agreement.
"Credit Agreement" means the Credit Agreement dated as of
December 11, 1996 among the OLP, Bank of America National Trust and
Savings Association, as agent, and the financial institutions listed
therein, providing for borrowings and letters of credit under a
working capital facility in an aggregate principal amount of up to
$50,000,000 and borrowings under an acquisition and expansion facility
in an aggregate principal amount of up to $75,000,000.
"Delaware Act" has the meaning assigned to such term in the
Recitals to this Agreement.
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"Dispute" has the meaning assigned to such term in Section
9(a).
"EEC" has the meaning assigned to such term in the Recitals
to this Agreement.
"Effective Time" means 8:00 a.m., Eastern Standard Time, on
the Closing Date.
"Environmental Laws" means any and all Laws relating to the
protection of the environment, pollution or the release of materials
into the environment or occupational health and safety matters.
"Excluded Assets" means, collectively, the Excluded Managing
GP Assets, the Excluded SC Assets and the Excluded SYN Assets.
"Excluded EEC Debt" means the indebtedness of EEC in the
aggregate amount equal to the Assumed SC Debt under or in connection
with that certain Credit Agreement dated as of August 1, 1996 among
EEC, certain subsidiaries of EEC, the lenders from time to time
parties thereto and The First National Bank of Boston, as agent for
such lenders, as amended to date, and the "Credit Documents" referred
to therein, and which indebtedness was assumed by the Managing GP as a
result of the Related Transactions.
"Excluded Liabilities" means, collectively, the Excluded
Managing GP Liabilities, the Excluded SC Liabilities and the Excluded
SYN Liabilities.
"Excluded Managing GP Assets" has the meaning assigned to
such term in Schedule 1.2(A).
"Excluded Managing GP Liabilities" has the meaning assigned
to such term in Schedule 1.3(A).
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"Excluded SC Assets" has the meaning assigned to such term
in Schedule 1.2(B).
"Excluded SC Liabilities" has the meaning assigned to such
term in Schedule 1.3(B).
"Excluded SYN Assets" has the meaning assigned to such term
in Schedule 1.2(C).
"Excluded SYN Liabilities" has the meaning assigned to such
term in Schedule 1.3(C).
"Fees and Expenses" means the Financing Expenses and the
Public Offering Expenses.
"Financing Expenses" means all commissions, fees and other
out-of-pocket expenses (including fees and expenses of accountants,
attorneys, consultants or other agents) incurred, paid or payable by
or on behalf of the OLP to the administrative agent, the co-agent, the
lenders, the placement agent, the note purchasers or other Persons in
connection with the Credit Agreement or the Note Offering.
"GP Interest" means with respect to the OLP or the MLP, an
interest in the OLP or the MLP, as the case may be, that provides the
holder thereof with the rights and obligations of a general partner in
accordance with the OLP Partnership Agreement or the MLP Partnership
Agreement, as the case may be.
"Incentive Distribution Rights" has the meaning assigned to
such term in the MLP Partnership Agreement.
"Indemnified Party" has the meaning assigned to such term in
Section 6.4(a).
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"Indemnifying Party" has the meaning assigned to such term
in Section 6.4(a).
"Information" has the meaning assigned to such term in
Section 10.2.
"Interests" has the meaning assigned to such term in Section
3.2.
"Laws" means any and all laws, statutes, ordinances, rules
or regulations promulgated by a governmental authority, orders,
decrees or decisions of a court or other adjudicative, regulatory or
other governmental authority, decisions or determinations of any
arbitrator in an arbitration proceeding or other binding
determinations of any court or adjudicative, regulatory or other
governmental authority.
"Litigation and Claims" means litigation and actions pending
or threatened or claims alleged against any of the Transferor Parties
or any of the OLP Parties, including civil and criminal actions,
workers' compensation proceedings, administrative and regulatory
proceedings, investigations, audits, inquiries, demands, claims
(including any title claims relating to real properties), whether
pending, threatened or alleged before, at or after the Effective Time.
"Litigation Records" has the meaning assigned to such term
in Section 6.6(b).
"LP Interest" means an interest in the OLP that provides the
holder thereof with the rights and obligations of a limited partner in
accordance with the OLP Partnership Agreement.
"LPG" means liquefied petroleum gas.
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"Managers" means the managers for the several Underwriters
listed in Schedule I to the Underwriting Agreement.
"Managing GP" has the meaning assigned to such term in the
opening paragraph of this Agreement.
"Managing GP Assets" means the Managing GP's Assets.
"MLP" has the meaning assigned to such term in the opening
paragraph of this Agreement.
"MLP Partnership Agreement" has the meaning assigned to such
term in the Recitals to this Agreement.
"Xxxxx" has the meaning assigned to such term in the
Recitals to this Agreement.
"Net Over-Allotment Proceeds" means the gross proceeds
received by the MLP from the Underwriters in connection with the
exercise by the Underwriters of the Over-Allotment Option, net of the
Over-Allotment UW Discount.
"NGC" has the meaning assigned to such term in the Recitals
to this Agreement.
"Note Agreement" means the Note Agreement dated as of
December 11, 1996 among the OLP, the Managing GP, SYN and the several
purchasers named therein, relating to the Note Offering.
"Note Offering" means the issuance and sale of an aggregate
$220,000,000 of senior secured notes due December 30, 2010 of the OLP
pursuant to the Note Agreement.
"NPS" means Northwestern Public Service Company, a Delaware
corporation.
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"OGP" has the meaning assigned to such term in the Recitals
to this Agreement.
"OLP" has the meaning assigned to such term in the opening
paragraph of this Agreement.
"OLP Damages" has the meaning assigned to such term in
Section 6.1.
"OLP Parties" means the OLP and any Affiliate of the OLP,
and any of their respective general partners, directors, officers or
employees, in their capacities as such, or successors or assigns.
"OLP Partnership Agreement" has the meaning assigned to such
term in the Recitals to this Agreement.
"OLP Subsidiary" means Cornerstone Sales & Service
Corporation, a Delaware corporation, a wholly-owned subsidiary of the
OLP.
"Operating Subsidiaries" means (i) with respect to EEC, the
direct or indirect wholly-owned subsidiaries of EEC which were merged
with and into EEC on or about December 11, 1996; and (ii) with
respect to SYN, the direct or indirect wholly-owned subsidiaries of
SYN which were merged with and into SYN on or about December 5, 1996
or December 11, 1996.
"Over-Allotment Option" shall mean the over-allotment option
granted to the Underwriters under the Underwriting Agreement.
"Over-Allotment UW Discount" means the amount of
underwriting discounts and commissions on the securities sold to the
Underwriters in connection with the exercise of the Over-Allotment
Option.
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"PEI" has the meaning assigned to such term in the Recitals
to this Agreement.
"Percentage Interest" has, with respect to the OLP, the
meaning assigned to such term in the OLP Partnership Agreement and,
with respect to the MLP, the meaning assigned to such term in the MLP
Partnership Agreement.
"Person" means an individual, corporation, limited liability
company, partnership, joint venture, trust, unincorporated
organization, association, government agency or political subdivision
thereof or other entity.
"Public Offering" means the initial public offering and sale
of 9,821,000 Common Units.
"Public Offering Expenses" means all underwriting discounts
and commissions (other than the Over-Allotment UW Discount) and fees
and other out-of-pocket expenses (including fees and expenses of
accountants, attorneys, printers, consultants or other agents)
incurred, paid or payable by or on behalf of the MLP to the
Underwriters or other Persons in connection with the Public Offering.
"Related Transactions" means the transactions referred to in
the third and fourth paragraphs in the Recitals to this Agreement.
"Remaining Assumed Debt" means the Assumed SYN Debt, the
Assumed Additional SYN Debt, the Assumed Managing GP Debt, the Assumed
Additional Managing GP Debt and the Assumed SC Debt.
"SC" has the meaning assigned to such term in the opening
paragraph of this Agreement.
"SC Assets" means SC's Assets.
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"SC Note" means that certain Amended and Restated Promissory
Note dated December 10, 1996 made by SC to the order of EEC in the
principal amount of $34,294,609.27, representing the remaining portion
of the indebtedness originally incurred by certain subsidiaries of EEC
in connection with the acquisition of certain assets from SYN pursuant
to the Additional Acquisition Documents, and which indebtedness was
assumed by SC as a part of the Related Transactions.
"Selling Stockholders" means Xxxxxxx X. Xxxxx, Xxxxxxx X.
Xxxxx, Xxxxxxx X. Xxxxx, Xxx X. Xxxxx and Xxxxxxxx Xxxxx.
"Service Assets" means, with respect to any Transferor, that
portion of such Transferor's Assets described in Schedule 1.4.
"Service Business" has the meaning assigned to such term in
Schedule 1.4.
"Specific Conveyances" has the meaning assigned to such term
in Section 3.1.
"Subordinated Unit" has the meaning assigned to such term in
the MLP Partnership Agreement.
"SYN" has the meaning assigned to such term in the opening
paragraph of this Agreement.
"SYN Acquisition Documents" means, collectively, the
Purchase and Sale Agreement dated as of May 17, 1995 among the Selling
Stockholders, Synergy Group Incorporated, a Delaware corporation, S &
J Investments, SYN and NGC (as amended from time to time, the "SYN
Purchase Agreement") and all agreements and documents entered into in
connection with the acquisition contemplated therein, in each case as
amended from time to time.
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"SYN Assets" means SYN's Assets.
"SYN Purchase Agreement" has the meaning assigned to such
term in the definition of SYN Acquisition Documents.
"Transaction Documents" means this Agreement, the
Underwriting Agreement, the MLP Partnership Agreement, the OLP
Partnership Agreement, the Note Agreement and the Credit Agreement.
"Transaction Expenses" means the Financing Expenses, the
Public Offering Expenses and the Transfer Expenses.
"Transfer Expenses" means all out-of-pocket expenses, fees
and costs, including all sales, use and similar taxes and documentary,
filing, recording, transfer, deed or conveyance fees or taxes, in each
case, that were or are incurred or paid or proposed to be incurred or
paid in connection with the contributions, conveyances and deliveries
to be made hereunder or in connection with any of the Related
Transactions; provided, however, that Transfer Expenses do not include
any such items that are included in Financing Expenses, Public
Offering Expenses or the Over-Allotment UW Discount.
"Transferor" and "Transferors" have the meanings assigned to
such terms in the opening paragraph of this Agreement.
"Transferor Damages" has the meaning assigned to such term
in Section 6.2.
"Transferor Parties" means each Transferor and any Affiliate
of any Transferor, and any of their respective general partners,
directors, officers or employees, in their capacities as such, and,
except to the extent such Persons are OLP Parties, their successors or
assigns.
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"Underwriters" means each Person named as an underwriter in
Schedule I to the Underwriting Agreement.
"Underwriting Agreement" means the Underwriting Agreement
dated December 11, 1996 among the MLP, the OLP, the Managing GP, SYN
and each of the Managers relating to the Public Offering.
1.2 Headings; References; Interpretation. All Article and
Section headings in this Agreement are for convenience only and shall
not be deemed to control or affect the meaning or construction of any
of the provisions hereof. The words "hereof," "herein" and
"hereunder" and words of similar import, when used in this Agreement,
shall refer to this Agreement as a whole, including all Schedules
attached hereto, and not to any particular provision of this
Agreement. All references herein to Sections and Schedules shall,
unless the context requires a different construction, be deemed to be
references to the Sections of this Agreement and the Schedules
attached hereto, and all such Schedules attached hereto are hereby
incorporated herein and made a part hereof for all purposes. All
personal pronouns used in this Agreement, whether used in the
masculine, feminine or neuter gender, shall include all other genders,
and the singular shall include the plural and vice versa. The use
herein of the word "including" following any general statement, term
or matter shall not be construed to limit such statement, term or
matter to the specific items or matters set forth immediately
following such word or to similar items or matters, whether or not
non-limiting language (such as "without limitation," "but not limited
to," or words of similar import) is used with reference thereto, but
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rather shall be deemed to refer to all other items or matters that
could reasonably fall within the broadest possible scope of such
general statement, term or matter.
2. Transactions. The transactions described in this
Section 2 are occurring on the Closing Date in the order set forth
below.
2.1 Contributions to the OLP.
(a) Effective as of the Effective Time, (i) the Managing
GP hereby grants, conveys, assigns, transfers, sets over, contributes
and delivers to, and further bargains and sells to and remises and
releases unto, the OLP all right, title and interest of the Managing
GP in and to the Managing GP Assets, together with all rights and
appurtenances thereto in any wise belonging; (ii) SYN hereby grants,
conveys, assigns, transfers, sets over, contributes and delivers to,
and further bargains and sells to and remises and releases unto, the
OLP all right, title and interest of SYN in and to the SYN Assets,
together with all rights and appurtenances thereto in any wise
belonging; and (iii) SC hereby grants, conveys, assigns, transfers,
sets over, contributes and delivers to, and further bargains and sells
to and remises and releases unto, the OLP all right, title and
interest of SC in and to the SC Assets, together with all rights and
appurtenances thereto in any wise belonging; in each case in exchange
for the consideration stated in Section 2.1(b) and Section 2.2, and
other good and valuable consideration, the sufficiency of which is
hereby acknowledged by each of the Transferors, and TO HAVE AND TO
HOLD such Assets unto the OLP, its successors and assigns, for its
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and their own use forever, subject, however, to the terms and
conditions stated in this Agreement.
(b) Effective as of the Effective Time, and simultaneously
in exchange for the conveyance, assignment, transfer and contribution
of the Assets pursuant to Section 2.1(a), and other good and valuable
consideration, the sufficiency of which is hereby acknowledged by the
OLP, the OLP hereby (i) accepts the Managing GP Assets as a
contribution to the capital of the OLP, continues the Managing GP's
.7764% GP Interest in the OLP, issues to the Managing GP an LP
Interest in the OLP and assumes the Managing GP's Assumed Liabilities
as provided in Section 4; (ii) accepts the SYN Assets as a
contribution to the capital of the OLP, issues to SYN a .2337% GP
Interest in the OLP, issues to SYN an LP Interest in the OLP and
assumes SYN's Assumed Liabilities as provided in Section 4; and (iii)
accepts the SC Assets as a contribution to the capital of the OLP,
issues to SC an LP Interest in the OLP and assumes SC's Assumed
Liabilities as provided in Section 4; with the interest of the
Managing GP, SYN and SC in the 98.9899% aggregate LP Interest in the
OLP determined as provided in the OLP Partnership Agreement.
2.2 Financings and Repayment of Certain Debt. On the
Closing Date, immediately following the transactions described in
Section 2.1 becoming effective, the OLP, using the proceeds of the
Note Offering in the approximate amount of $220,000,000, advances
made under the Credit Agreement in the approximate amount of
$12,800,000 and letters of credit issued under the Credit Agreement
(i) is repaying in full the Assumed NGC Debt, the Assumed CGI
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Acquisition Debt and the Assumed EEC Debt, in the approximate
aggregate amount of $153,405,000, and is issuing letters of credit
necessary to provide substitute collateral for any outstanding letters
of credit which are part of the Assumed Liabilities, (ii) is
distributing $76,696,502 to SYN, and (iii) is distributing $2,698,136
in the aggregate to the Managing GP and SYN, in proportion to their
relative percentage of the aggregate GP interest in the OLP.
2.3 Contributions to MLP.
(a) On the Closing Date, effective immediately following
the consummation of the transactions described in Section 2.2, (i) the
Managing GP hereby grants, conveys, assigns, transfers, sets over,
contributes and delivers to the MLP all right, title and interest of
the Managing GP in and to its LP Interest in the OLP, together with
all rights and appurtenances thereto in any wise belonging; (ii) SYN
hereby grants, conveys, assigns, transfers, sets over, contributes and
delivers to the MLP all right, title and interest of SYN in and to its
LP Interest in the OLP, together with all rights and appurtenances
thereto in any wise belonging; and (iii) SC hereby grants, conveys,
assigns, transfers, sets over, contributes and delivers to the MLP all
right, title and interest of SC in and to its LP Interest in the OLP,
together with all rights and appurtenances thereto in any wise
belonging; in each case in exchange for the consideration stated in
Section 2.3(b) and other good and valuable consideration, the
sufficiency of which is hereby acknowledged by each of the
Transferors, and TO HAVE AND TO HOLD such LP Interests unto the MLP,
its successors and assigns, for its and their own use forever,
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subject, however, to the terms and conditions stated in this
Agreement.
(b) On the Closing Date, effective simultaneously with and
in exchange for the transfer of the LP Interests pursuant to Section
2.3(a), and other good and valuable consideration, the sufficiency of
which is hereby acknowledged by the MLP, the MLP hereby (i) accepts
the LP Interest of the Managing GP in the OLP as an additional
contribution to the capital of the MLP, and issues to the Managing GP
a .7686% GP Interest in the MLP, its share (as determined in
accordance with the MLP Partnership Agreement) of 5,071,233
Subordinated Units and 7,686 Incentive Distribution Rights; (ii)
accepts the LP Interest of SYN in the OLP as an additional
contribution to the capital of the MLP, and issues to SYN a .2314% GP
Interest in the MLP, 1,526,386 Subordinated Units and 2,314 Incentive
Distribution Rights; and (iii) accepts the LP Interest of SYN in the
OLP as a contribution to the capital of the MLP and issues to SC its
share (as determined in accordance with the MLP Partnership Agreement)
of 5,071,233 Subordinated Units.
2.4 Public Offering. On the Closing Date, effective
immediately following the consummation of the transactions described
in Section 2.3, the Public Offering is closing and the MLP is issuing
9,821,000 Common Units in exchange for the proceeds of the Public
Offering (net of the Over-Allotment UW Discount and certain of the
Public Offering Expenses).
2.5 MLP Transfers to the OLP. On the Closing Date,
effective immediately following the consummation of the transactions
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described in Section 2.4, (a) the MLP is redeeming the interest of NGC
as organizational limited partner in the MLP using a portion the
proceeds of the Public Offering received from the Underwriters for
such purpose and is contributing in immediately available funds the
remaining proceeds of the Public Offering to the OLP, and (b)
effective upon the receipt of such funds the OLP hereby accepts such
funds as a contribution to capital of the OLP.
2.6 Repayment of Remaining Assumed Debt. On the Closing
Date, effective immediately following the consummation of the
transactions described in Section 2.5, (a) the OLP (i) will repay in
full the Remaining Assumed Debt, in the approximate amount of
$174,200,000, using the funds contributed to the OLP by the MLP
pursuant to Section 2.5 and (ii) will pay in full the remaining Fees
and Expenses and any other Transaction Expenses then due and payable
using any monies remaining from the funds contributed to the OLP by
the MLP pursuant to Section 2.5, and (b) with the monies the Managing
GP receives under clause (a)(i) of this Section 2.6(a) from the OLP in
payment of the Assumed SC Debt, the Managing GP will repay in full the
Excluded EEC Debt in the amount of $34,294,609.27.
2.7 Certificates. After giving effect to the transactions
contemplated by this Section 2, (a) the Managing GP shall have a GP
Interest in the OLP with a Percentage Interest of .7764% SYN shall
have a GP Interest in the OLP with a Percentage Interest of .2337%,
and the MLP shall have an LP Interest in the OLP with a Percentage
Interest of 98.9899%, and (b) (i) the Managing GP shall have a GP
Interest in the MLP with a Percentage Interest of .7686%, its portion
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(as determined in accordance with the MLP Partnership Agreement) of
5,071,233 Subordinated Units and 7,686 Incentive Distribution Rights,
(ii) SYN shall have a GP Interest in the MLP with a Percentage
Interest of .2314%, 1,526,386 Subordinated Units and 2,314 Incentive
Distribution Rights, and (iii) SC shall have its portion (as
determined in accordance with the MLP Partnership Agreement) of
5,071,233 Subordinated Units. Upon the request of any Transferor, the
MLP shall deliver to such Transferor, one or more certificates
representing the GP Interests in the MLP held by such Transferor and
any Subordinated Units and any Incentive Distribution Rights issued to
such Transferor.
3. Provisions Relating to Transfer of Assets.
3.1 Specific Conveyances. To further evidence the
conveyances, assignments, transfers and contributions herein and more
fully and effectively convey record title with respect to the real
property and certain other property included in the Assets transferred
by the Transferors, each Transferor has executed and delivered to the
OLP certain additional conveyance instruments (the "Specific
Conveyances") with respect to certain of the Assets being transferred
by it. The Specific Conveyances shall evidence and perfect the
conveyances, assignments, transfers and contributions made by this
Agreement and shall not constitute an additional conveyance,
assignment, transfer or contribution of such Assets, and each Specific
Conveyance shall be subject to the terms of this Agreement. The
Specific Conveyances are not intended to modify, and shall not modify,
any of the terms, covenants and conditions herein set forth and are
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not intended to create, and shall not create, any additional covenants
or warranties of or by any Transferor.
3.2 Nonassignability of Assets. To the extent that any
license, permit, agreement, lease, sales or purchase order, commitment
or other contract, property interest, qualification or asset described
in this Agreement as being sold, assigned, transferred or conveyed to
the OLP by any Transferor (collectively the "Commitments") or any
claim, right or benefit arising thereunder or resulting therefrom
(collectively, together with the Commitments, the "Interests"), is not
capable of being sold, assigned, transferred or conveyed without the
approval, consent or waiver of the issuer thereof or the other party
thereto, or any third Person, including a government or governmental
or regulatory authority, or if such sale, assignment, transfer or
conveyance or attempted sale, assignment, transfer or conveyance would
be invalid, or would destroy, terminate or eliminate (or permit any
other Person to destroy, terminate or eliminate) the Interests related
thereto, or would constitute a breach of a Commitment or a violation
of any Law, then any provision in this Agreement or any Specific
Conveyance to the contrary notwithstanding, this Agreement shall not
constitute a sale, assignment, transfer or conveyance thereof or an
attempted sale, assignment, transfer or conveyance thereof, but the
applicable Transferor and the OLP shall do such acts and things as may
be reasonably necessary give the OLP the full benefit in respect of
the Interests and the applicable Transferor the full benefit of the
assumption of the Assumed Liabilities with respect thereto, including
using reasonable efforts in order that any necessary third party shall
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execute such documents and do such acts and things as may be
reasonably required for such purpose (including any consent, approval
or amendment required to novate, reissue or assign the affected
Commitments); provided, however, that neither such Transferor nor the
OLP shall be obligated to pay any consideration therefor (except for
filing fees and other similar charges which shall be paid by the OLP)
to, or commence litigation against, the third party or Person from
whom such consents, approvals or waivers are requested. If the
applicable Transferor or the OLP is unable to obtain any such required
consent, approval or waiver, then until such required consent,
approval or waiver is obtained, and in the absence of any alternative
arrangement established by agreement between such Transferor and the
OLP, the applicable Transferor shall continue to be bound by such
Commitments and the OLP shall, as agent for the applicable Transferor
or as subcontractor, pay, perform and discharge fully all the
obligations of such Transferor thereunder from and after the Effective
Time and indemnify and hold harmless such Transferor and its
Affiliates and their respective general partners, directors, officers
and employees, in their capacities as such, from and against, all
losses, claims, damages, taxes, liabilities and expenses whatsoever
arising out of or in connection with the OLP's performance of or
omission to perform such Transferor's obligations thereunder and
hereunder, and the applicable Transferor shall, without further
consideration, pay and remit to the OLP (or its designee) promptly all
money, rights and other consideration received in respect of such
performance after payment of any taxes, costs or expenses due from the
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applicable Transferor (or its Affiliates) with respect to such
receipt. The applicable Transferor shall conduct itself in the
exercise of its rights under all such Commitments only as reasonably
directed by the OLP and at the OLP's expense. If and when any such
approval, consent or waiver shall be obtained or such Commitment shall
otherwise become assignable or able to be novated or such restriction
shall have been satisfied or waived or no longer apply, the assignment
of the Assets and the assumption of the Assumed Liabilities related to
such approval, consent or waiver or restriction on assignment and/or
assumption shall become effective automatically as of the Effective
Time, without further action on the part of the Transferor, the OLP or
any other Person, and without payment of further consideration.
4. Assumption of Assumed Liabilities. Effective the
Effective Time, in connection with the transfer and contribution of
the Assets to the OLP by the Transferors, the OLP hereby absolutely
and irrevocably assumes and agrees to be solely liable and responsible
for and to duly and timely pay, perform and discharge all of the
Assumed Liabilities; provided, however, that said assumption and
agreement to duly and timely pay, perform and discharge the Assumed
Liabilities shall not (a) increase the obligation of the OLP with
respect to the Assumed Liabilities beyond the obligation that the
Transferors would have had if this Agreement and the aforesaid
assumption were not in effect, (b) waive any valid defense that was
available to any Transferor with respect to the Assumed Liabilities or
(c) enlarge any rights or remedies of any third party with respect to
any of the Assumed Liabilities.
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5. Title Matters.
5.1 Encumbrances. The conveyance, assignment, transfer and
contribution of the Assets and assumption of the Assumed Liabilities
pursuant to this Agreement are made expressly subject to (a) all
recorded and unrecorded liens, encumbrances, agreements, defects,
restrictions, adverse claims and all Laws, in each case to the extent
the same are valid, enforceable and affect the Assets, including all
matters that a current survey or visual inspection of the Assets would
reflect, (b) the Assumed Liabilities and (c) all matters contained in
the Specific Conveyances. It is further agreed that the Specific
Conveyances are subject to the provisions of this Agreement, including
this Section 5.1 and Section 3.2 and Section 5.2.
5.2 Disclaimer of Warranties; Subrogation; Waiver of Bulk
Sales Laws.
(a) EACH TRANSFEROR IS CONVEYING THE ASSETS "AS IS WHERE
IS" WITHOUT REPRESENTATION OR WARRANTY, WHETHER EXPRESS, IMPLIED OR
STATUTORY (ALL OF WHICH EACH TRANSFEROR HEREBY DISCLAIMS), AS TO (i)
TITLE, (ii) FITNESS FOR ANY PARTICULAR PURPOSE, MERCHANTABILITY,
DESIGN OR QUALITY, OR (iii) ANY OTHER MATTER WHATSOEVER. THE
PROVISIONS OF THIS SECTION 5.2 HAVE BEEN AGREED TO BY EACH TRANSFEROR
AND THE OLP AFTER DUE CONSIDERATION OF THE EFFECT THEREOF AND THE
AMOUNT OF CONSIDERATION BEING EXCHANGED FOR THE CONTRIBUTIONS BEING
MADE AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY
REPRESENTATIONS OR WARRANTIES OF EACH TRANSFEROR, WHETHER EXPRESS,
IMPLIED OR STATUTORY, WITH RESPECT TO THE ASSETS THAT MAY ARISE
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PURSUANT TO ANY LAW NOW OR HEREAFTER IN EFFECT, OR OTHERWISE, EXCEPT
AS EXPRESSLY SET FORTH HEREIN.
(b) The conveyance, assignment, transfer and contribution
of the Assets made pursuant to this Agreement is made with full rights
of substitution and subrogation of the OLP, and all persons claiming
by, through and under the OLP, to the extent assignable, in and to all
covenants and warranties by the predecessors-in-title of each
Transferor (other than by any Transferor Parties), and with full
subrogation of all rights accruing under applicable statutes of
limitation and all rights of action of warranty against all former
owners of the Assets (other than the Transferor Parties and rights
constituting Excluded Assets); and excluding in each case all rights
constituting Excluded Assets.
(c) The Transferors and the OLP agree that the disclaimers
contained in this Section 5.2 are "conspicuous" disclaimers. Any
covenants implied by statute or law by the use of the words "grant,"
"convey," "bargain," "sell," "assign," "transfer," "deliver," or "set
over" or any of them or any other words used in this Agreement are
hereby expressly disclaimed, waived and negated.
(d) Each of the parties hereto hereby waives compliance
with any applicable bulk sales law or any similar law in any
applicable jurisdiction in respect of the transactions contemplated by
this Agreement.
(e) Except for the Excluded Liabilities as to such Person,
the OLP hereby forever waives any claim or right of action which it
now or in the future may ever have against any Transferor or any of
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the other Transferor Parties arising out of or in connection with any
Environmental Law with respect to the Assets or the Business, and
unconditionally releases the Transferors and the other Transferor
Parties from any and all liabilities, penalties, losses or other
damages for which any Transferor or any of the Transferor Parties may
be otherwise responsible pursuant to any Environmental Laws.
6. Indemnification.
6.1 Indemnification by the Transferor. Subject to Section
6.3, without any further responsibility or liability of, or recourse
to, any of the OLP Parties, the Managing GP shall absolutely and
irrevocably be liable and responsible for the Excluded Managing GP
Liabilities, SYN shall absolutely and irrevocably be liable and
responsible for the Excluded SYN Liabilities and SC shall absolutely
and irrevocably be liable and responsible for the Excluded SC
Liabilities. Nothing in this Agreement is intended or shall be
construed to make the OLP or any of the other OLP Parties liable for
any of any of the Excluded Liabilities.
Each Transferor shall indemnify, defend, save and hold
harmless each of the OLP Parties from and against all claims,
liabilities, obligations, losses, expenses, costs and costs of defense
(as and when incurred), including fines, charges, penalties,
allegations, demands, damages (including actual, punitive or
consequential, foreseen or unforeseen, known or unknown), settlements,
awards, judgments, court costs and reasonable attorneys' and
consultants' fees, in each case of any kind, character or nature
whatsoever, to the extent arising out of (a) the Excluded Managing GP
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Liabilities if such Transferor is the Managing GP, the Excluded SYN
Liabilities if such Transferor is SYN or the Excluded SC Liabilities
if such Transferor is SC, (b) any failure of such Transferor to comply
with any applicable bulk sales law of any jurisdiction in connection
with the transfers of such Transferor's Assets to the OLP to the
extent such failure results in the assertion of claims against the
Assets in respect of the Excluded Managing GP Liabilities if such
Transferor is the Managing GP, the Excluded SYN Liabilities if such
Transferor is SYN or the Excluded SC Liabilities if such Transferor is
SC, or (c) the breach by such Transferor of any of its obligations
under this Agreement, all of which are hereinafter collectively
referred to as the "OLP Damages".
OLP Damages with respect to which, but only to the extent
that, any proceeds are received by, or on behalf of, the OLP, the MLP
or the OLP Subsidiary or their respective successors or assigns from
any insurance policy (which are non-reimbursable by the OLP, the MLP,
the OLP Subsidiary or such successor or assign under any self
insurance coverage), shall not be the subject of indemnification under
this Agreement.
6.2 Indemnification by the OLP. Subject to Section 6.3,
effective as of the Effective Time, the OLP hereby without any further
responsibility or liability of, or recourse to, any of the Transferor
Parties, absolutely and irrevocably assumes and becomes liable and
responsible for the Assumed Liabilities. Nothing in this Agreement is
intended or shall be construed to cause any Transferor or any of the
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other Transferor Parties to become liable for any of any of the
Assumed Liabilities after the Effective Time.
The OLP shall indemnify, defend, save and hold harmless each
of the Transferor Parties from and against all claims, liabilities,
obligations, losses, expenses, costs and costs of defense (as and when
incurred), including fines, charges, penalties, allegations, demands,
damages (including actual, punitive or consequential, foreseen or
unforeseen, known or unknown), settlements, awards, judgments, court
costs and reasonable attorneys' and consultants' fees, in each case of
any kind, character or nature whatsoever, to the extent arising out of
(a) the Assumed Liabilities or (b) the breach by any of the OLP
Parties of any of their obligations under this Agreement, all of which
are hereinafter collectively referred to as the "Transferor Damages".
Transferor Damages incurred by any Transferor or its
subsidiaries or their respective successors or assigns (which are
Transferor Parties) with respect to which, but only to the extent
that, any proceeds are received by, or on behalf of, such Transferor,
subsidiary, successor or assign from any insurance policy (which are
non-reimbursable by such Transferor, subsidiary, successor or assign
under any self insurance coverage), shall not be the subject of
indemnification under this Agreement.
6.3 Specific Indemnification Issues. (a) In the event a
claim, demand, action or proceeding is brought by a third party in
which the liability as between any Transferor and the OLP is
determined in any judgment, award or decree of a court or other
governmental authority having jurisdiction to be joint or concurrent
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or in which the entitlement to indemnification hereunder is not
readily determinable, the parties may negotiate in good faith in an
effort to agree, as between such Transferor and the OLP, on the proper
allocation of liability or entitlement to indemnification, as well as
the proper allocation of the costs of any joint defense or settlement
pursuant to Section 6.5(d), all in accordance with the provisions of,
and the principles set forth in, this Agreement. In the absence of
any such agreement or if the Transferor or the OLP elects, such
allocation of liability, entitlement to indemnification and allocation
of costs shall be subject to resolution between such Transferor and
the OLP pursuant to Section 9 of this Agreement.
(b) It is acknowledged that after the Effective Time, the
parties hereto may have negotiated business relationships, which
relationships will be described in contracts, agreements and other
documents entered into in the normal course of business. Such
contracts, agreements and other documents may include agreements by
the parties hereto or their Affiliates to supply, after the Effective
Time, materials, products or other goods, services or leases of
personal or real property. Such business relationships and such
contracts, agreements and other documents shall not be subject to the
indemnity provisions hereof, unless the parties expressly agree to the
contrary in the agreements governing such relationships.
6.4 Notice and Payment of Claims. (a) If any Person
entitled to a defense and/or indemnification under this Agreement (the
"Indemnified Party") determines that it is or may be entitled to a
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defense or indemnification by the OLP or any Transferor, as the case
may be (the "Indemnifying Party"), under this Agreement:
(i) The Indemnified Party shall deliver promptly to the
Indemnifying Party a written notice and demand for a defense or
indemnification, specifying the basis for the claim for defense
and/or indemnification, the nature of the claim, and if known,
the amount for which the Indemnified Party reasonably believes it
is entitled to be indemnified. Nothing in this subparagraph
shall be interpreted to invalidate any claim for indemnification
by the Indemnified Party, unless, and then only to the extent
that, the failure of the Indemnified Party to deliver such notice
results in actual prejudice to the Indemnifying Party's ability
to defend such claim.
(ii) The Indemnifying Party shall have ten (10) days from
receipt of the notice requesting indemnification within which to
either: (A) assume the defense of such litigation or claim; (B)
pay the claim in immediately available funds; (C) reserve its
rights pending resolution under Section 6.5(d); or (D) object in
accordance with Section 6.4(b). This ten (10) day period may be
extended by agreement of the Indemnifying Party and the
Indemnified Party. Nothing in this subparagraph shall be
interpreted to abrogate or delay a party's obligation to provide
the other with a defense under this Agreement.
(b) The Indemnifying Party may object to the claim for
defense and/or indemnification set forth in any notice; provided,
however, that if the Indemnifying Party does not give the Indemnified
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Party written notice setting forth its objection to such claim (or the
amount thereof) and the grounds therefor within the same ten (10) day
period (or any extended period), the Indemnifying Party shall be
deemed to have acknowledged its liability to provide a defense or to
pay the amount of such claim and, subject to Section 9, the
Indemnified Party may exercise any and all of its rights under
applicable law to collect such amount or obtain such defense. Any
objection to a claim for a defense or indemnification shall be
resolved in accordance with Section 9.
(c) To the extent provided in the last sentence of Section
6.1 or the last sentence of Section 6.2, the right to a defense or
indemnification under this Agreement applies only insofar as defense
and indemnification are not provided for by insurance (whether through
a third party or a captive insurance company). Nevertheless, the
potential availability of insurance coverage to the applicable
Transferor or the OLP shall not relieve the other party of its
obligations for defense or indemnification hereunder, or delay either
party's obligation to the other to assume a defense or pay any sums
due hereunder.
(d) Payments due to be made to any Indemnified Party under
this Section 6 shall bear interest from the date on which the
Indemnified Party pays any amount or actually suffers a loss in
respect of OLP Damages or Transferor Damages, as the case may be, to
but excluding the date of actual payment (whether before or after
judgment) at the rate per annum equal to (i) the rate per annum
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announced from time to time by Bank of America National Trust and
Savings Association as its reference rate plus (ii) two (2) percent.
(e) Payments due to be made under this Agreement shall be
free and clear of all deductions, withholdings, set-off or
counterclaims whatsoever, except as may be required by law. If any
deductions or withholdings are required by law, the Indemnifying Party
shall be obliged to pay such sum as will, after such deduction,
withholding, set-off or counterclaim has been made, leave the
Indemnified Party with the same amount as it would have been entitled
to receive in the absence of any such requirement to make a deduction
or withholding. The parties to this Agreement may enter into
agreements or other arrangements providing for the set-off of payments
due to be made by way of indemnification to both the applicable
Transferor and the OLP.
(f) Payments due to be made under this Agreement shall be
reduced by the amount by which any taxes for which the Indemnified
Party would have been accountable or liable to be assessed are either
(i) actually reduced prior to payment falling due hereunder or (ii)
likely to be reduced subsequent to payment falling due hereunder in
the reasonable opinion of the Indemnified Party acting in good faith
in the light of the circumstances prevailing at the time of delivery
of written notice in accordance with Section 6.4(a). The
determination of the amount by which taxes are actually or likely to
be reduced shall take into account the time value of money.
6.5 Defense of Third Party Claims. (a) If the Indemnified
Party's claim for indemnification is based, under this Agreement, on a
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claim, demand, investigation, action or proceeding, judicial or
otherwise, brought by a third party, and the Indemnifying Party does
not object under Section 6.4(b), the Indemnifying Party shall, within
the ten 10 day period (or any extended period) referred to in Section
6.4(a), assume the defense of such third-party claim at its sole cost
and expense and shall thereafter be designated as the "Case Handler."
Any such defense shall be conducted by attorneys employed by the
Indemnifying Party. The Indemnified Party may retain attorneys of its
own choosing to participate in such defense at the Indemnified Party's
sole cost and expense.
(b) If the Indemnifying Party assumes the defense of any
such third-party claim, the Indemnifying Party may settle or
compromise any such claim which requires only the payment of money by
the Indemnifying Party without the prior consent of the Indemnified
Party so long as all present and future claims relating to the
compromised claim against the Indemnified Party are irrevocably and
unconditionally released in full and may settle or compromise other
such claims only with the prior written consent of the Indemnified
Party.
(c) The Indemnifying Party shall pay to the Indemnified
Party (or to such party as is identified by the Indemnified Party) in
immediately available funds the amount for which the Indemnified Party
is entitled to be indemnified within thirty (30) days after the
settlement or compromise of such third-party claim or the judgment of
a court of competent jurisdiction (or within such earlier period as is
required by such settlement, compromise or judgment or such longer
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period as agreed to by Indemnifying Party and the Indemnified Party).
If the Indemnifying Party does not assume the defense of any such
third-party claim, the Indemnifying Party shall be bound by the result
obtained with respect thereto by the Indemnified Party, except that
the Indemnifying Party shall have the right to contest that it is
obligated to the Indemnified Party under the terms of this Agreement,
provided the Indemnifying Party shall have raised its objection in a
timely manner under Section 6.4.
(d) In the event a claim, demand, action or proceeding is
brought by a third party in which the liability as between the OLP and
any Transferor is alleged to be joint or in which the entitlement to
indemnification hereunder is not readily determinable, such parties
shall cooperate in a joint defense. Such joint defense shall be under
the general management and supervision of the party which is expected
to bear the greater share of the liability, and which will be
considered the Case Handler, unless otherwise agreed; provided,
however, that neither party shall settle or compromise any such joint
defense matter without the consent of the other. The costs of such
joint defense, any settlement and any award or judgment (unless the
award or judgment specifies otherwise) shall be borne as the parties
may agree; or in the absence of such agreement, such costs shall be
borne by the party incurring such costs, subject to ultimate
resolution between the OLP and the applicable Transferor pursuant to
Section 9.
6.6 Cooperation and Preservation of Records. (a) The OLP
Parties and the Transferor Parties shall cooperate with one another
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fully and in a timely manner as requested by the others in connection
with the defense of any Litigation and Claims.
(b) Such cooperation shall include, without limitation,
making available to the other party, during normal business hours and
upon reasonable notice, all books, records and information
("Litigation Records"), officers and employees (without substantial
interruption of employment) necessary or useful in connection with any
actual or threatened Litigation and Claims and any investigation,
audit, action or proceeding relating thereto.
(c) Each party shall continue in force, or, at the request
of any other party, shall issue, notices exempting from destruction
any Litigation Records which the requesting party represents may be
necessary to the defense of, or required to be produced in discovery
in connection with, any such claim, investigation, audit, action or
proceeding and shall refrain from destroying any such Litigation
Records until authorized by the requesting party. The requesting
party shall notify the other parties promptly when the Litigation
Records are no longer required to be maintained.
(d) The party requesting access to Litigation Records or
officers and employees pursuant to Section 6.6(b) or preservation of
Litigation Records pursuant to Section 6.6(c) shall bear all
reasonable out-of-pocket expenses (except reimbursement of salaries,
employee benefits and general overhead) incurred by the other parties
in connection with providing such Litigation Records or officers and
employees.
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(e) Any party providing Litigation Records hereunder may
elect, upon a reasonable basis and within a reasonable time, to
designate all or a portion of the Litigation Records as confidential
or proprietary. If Litigation Records are so designated, each of the
parties receiving them will treat them as it would its own
confidential or proprietary information and will take all reasonable
steps to protect and safeguard the Litigation Records while in its own
custody and will attempt to shield such information from disclosure by
motions to quash, motions for a protective order, redaction or other
appropriate actions.
7. Tax Matters.
7.1 Refunds of Taxes. Upon the request of any Transferor,
the OLP shall assist such Transferor in connection with (or to the
extent necessary shall file, or cause to be filed in such form as such
Transferor may reasonably request), claims for refunds of federal,
state, local or foreign income taxes attributable to the operation of
the Business of such Transferor prior to the Effective Time. Each
Transferor shall have the sole right to prosecute any claims for such
refunds (by suit or otherwise) at such Transferor's expense and with
counsel of such Transferor's choice, and the OLP and its Affiliates
shall cooperate fully with such Transferor in connection therewith.
7.2 Notice of Tax Audits. The OLP shall promptly notify
each Transferor in writing upon the receipt by the OLP or any of its
Affiliates of a notice of any pending or threatened audit or
assessment against the OLP or any of its Affiliates with respect to
any taxes for which the OLP or any of its Affiliates is or may be
-41-
512
entitled to indemnification under this Agreement. The affected
Transferor shall have the sole right, at its election, (a) to
represent the interests of the OLP and its Affiliates with respect to
any such audits or assessments, including in any administrative or
court proceeding relating thereto, and (b) employ counsel of its
choice at its expense and to control the conduct of such audit,
assessment, or proceeding, including the settlement or disposition
thereof. The OLP and its Affiliates shall cooperate fully with each
such Transferor and its counsel in the defense against or compromise
of any claim in any such audit, assessment, or proceeding.
8. Further Assurances and Power of Attorney.
8.1 Further Assurances. From time to time after the date
hereof, and without any further consideration, each party hereto shall
execute, acknowledge and deliver all such additional documents, and
will do all such other acts and things, all in accordance with
applicable Law, as may be necessary or appropriate to more fully and
effectively carry out the purposes and intent of this Agreement.
8.2 Power of Attorney. Each Transferor hereby constitutes
and appoints the OLP, its successors and assigns, its true and lawful
attorney-in-fact with full power of substitution for it and in its
name, place and stead or otherwise on behalf of such Transferor, its
successors and assigns, and for the benefit of the OLP, its successors
and assigns, to demand and receive from time to time the Assets of
such Transferor and to execute in the name of such Transferor and its
successors and assigns instruments of conveyance, instruments of
further assurance and to give receipts and releases in respect of the
-42-
513
same, and from time to time to institute and prosecute in the name of
the OLP or such Transferor for the benefit of the OLP, as may be
appropriate, any and all proceedings at law, in equity or otherwise
which the OLP, its successors and assigns may deem proper in order to
collect, assert or enforce any claims, rights or titles of any kind in
and to the Assets of such Transferor, and to defend and compromise any
and all actions, suits or proceedings in respect of any of such Assets
and to do any and all such acts and things in furtherance of this
Agreement as the OLP, its successors or assigns shall reasonably deem
advisable. Each Transferor hereby declares that the appointment
hereby made and the powers hereby granted are coupled with an interest
and are and shall be irrevocable and perpetual and shall not be
terminated by any act of such Transferor, its successors or assigns or
by operation of law.
9. Arbitration.
(a) Any dispute, controversy or claim arising out of or
relating to this Agreement or its breach, interpretation, termination
or validity, including any question whether a matter is subject to
arbitration hereunder, is referred to herein as a "Dispute."
(b) If the parties fail to settle any Dispute within thirty
(30) days after any party has given notice to the other parties hereto
of the claimed existence of a Dispute, the Dispute shall be resolved
by a confidential, binding arbitration. All such Disputes shall be
arbitrated in Chicago, Illinois pursuant to the arbitration rules and
procedures of J.A.M.S./Endispute with the arbitrator or arbitrators
selected in the manner provided in such rules, except that the "Final
-43-
514
Offer (or Baseball)" Arbitration Option shall not be used unless
agreed to in writing by the parties to the Dispute.
(c) Judgment upon any award rendered by the arbitrators may
be entered in any court having jurisdiction, and each party hereto
consents and submits to the jurisdiction of such court for purposes of
such action. The statute of limitations, estoppel, waiver, laches and
similar doctrines, which would otherwise be applicable in any action
brought by a party, shall be applicable in any arbitration proceeding,
and the commencement of an arbitration proceeding shall be deemed the
commencement of an action for those purposes. The Federal Arbitration
Act shall apply to the construction, interpretation and enforcement of
this arbitration provision. Each party shall bear its own expenses
(including the fees and expenses of legal counsel and accountants) in
connection with such arbitration and bear one-half of the arbitrators'
fees and expenses, provided that the arbitral award shall allocate
such fees and expenses of counsel, accountants, other advisors and the
arbitrators according to the relative success of the parties in the
arbitration, as determined by the arbitrators. The arbitrators shall
award an amount equal to the actual monetary damages suffered by each
party, which may include interest costs incurred by such party but the
arbitrators shall not have the authority to award punitive damages.
10. Miscellaneous.
10.1 Costs. The OLP shall be responsible for and shall pay
all Financing Expenses and Transfer Expenses and the MLP shall be
responsible for and shall pay all Public Offering Expenses and the
Over-Allotment UW Discount, in each case whether incurred prior to, as
-44-
515
of or after the Effective Time. In addition, the OLP shall be
responsible for all costs, liabilities and expenses (including court
costs and reasonable attorneys' fees) incurred in connection with the
satisfaction of the parties obligations pursuant to Section 3.2.
Notwithstanding the foregoing, the Transferors and their respective
Affiliates shall be entitled to pay any such expenses which are
required to be paid by the OLP or the MLP and be reimbursed by the OLP
or the MLP, as appropriate. If any Transferor or any of its
Affiliates have paid or advanced any Transfer Expenses, Financing
Expenses or Public Offering Expenses, then the OLP or the MLP, as
appropriate, shall reimburse such Transferor or such Affiliate
promptly upon request therefor and the MLP hereby guarantees the
payment of all amounts required to be so paid by the OLP.
10.2 Access to Records. After the Effective Time, the OLP
and its Affiliates shall permit each of the Transferors and their
respective Affiliates and agents to have full access, at any
reasonable time and from time to time, to such books, records, and
other data relating to the Assets or the Business (the "Information")
as any such Transferor or Affiliate may request. If the OLP intends
at any time to discard any Information relating to the Assets or to
the operation of the Business prior to the Effective Time, the OLP
shall (i) give the Transferors written notice of such intention at
least thirty (30) days prior to discarding such Information, and (ii)
allow the Transferors to take possession of such Information if they
so request within such thirty (30) day period.
-45-
516
10.3 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties signatory hereto
and their respective successors and assigns.
10.4 No Third Party Rights. The provisions of this
Agreement are intended to bind the parties signatory hereto and their
respective successors and assigns and are not intended to and do not
create rights in any other Person or confer upon any other Person any
benefits, rights or remedies and no other Person is or is intended to
be a third party beneficiary of any of the provisions of this
Agreement.
10.5 Counterparts. This Agreement may be executed in any
number of counterparts, all of which together shall constitute one
agreement binding on the parties hereto.
10.6 Governing Law. This Agreement shall be governed by,
and construed in accordance with, the internal laws of the State of
Delaware without regard to conflict of law principles thereof, except,
if it is mandatory in any other jurisdiction to have the law of such
other jurisdiction govern this Agreement in order for this Agreement
to be effective with respect to a particular Asset, then the laws of
such other jurisdiction shall govern this Agreement with respect to
such Asset.
10.7 Severability. If any of the provisions of this
Agreement are held by any court of competent jurisdiction to
contravene, or to be invalid under, the laws of any political body
having jurisdiction over the subject matter hereto, such contravention
or invalidity shall not invalidate the entire Agreement. Instead,
-46-
517
this Agreement shall be construed as if it did not contain the
particular provision or provisions held to be invalid, and an
equitable adjustment shall be made and necessary provision added so as
to give effect to the intention of the parties as expressed in this
Agreement at the time of execution of this Agreement.
10.8 Deed; Xxxx of Sale; Assignment. To the extent required
by applicable law, this Agreement shall also constitute a "deed,"
"xxxx of sale" or "assignment" of the Assets.
10.9 Amendment or Modification. This Agreement may be
amended or modified from time to time only by the written agreement of
all the parties hereto and the provisions of this Agreement may be
waived only if such waiver is set forth in a writing signed by the
party sought to be bound by such waiver.
10.10 Integration. This Agreement supersedes all
previous understandings or agreements between the parties, whether
oral or written, with respect to its subject matter and this document
is an integrated agreement which contains the entire understanding of
the parties. No understanding, representation, promise or agreement,
whether oral or written, is intended to be or shall be included in or
form part of this Agreement unless it is contained in a written
amendment hereto executed by the parties hereto after the date of this
Agreement.
10.11 Nonrecourse. Notwithstanding any provision to the
contrary contained in this Agreement, no recourse in respect of the
payment or performance of the obligations of the OLP or the MLP
hereunder shall be had against any partner of the MLP or the OLP, as
-47-
518
the case may be, as a result of any such Person's status as a partner
of the MLP or the OLP, respectively, except to the extent of such
partner's interests (in its capacity as a partner of the MLP), if any,
in the MLP and the MLP's property, in the case of the MLP's
obligations, and such partner's interests (in its capacity as a
partner of the OLP), if any, in the OLP and the OLP's property, in the
case of the OLP's obligations, it being expressly understood that
liability for the payment and performance of the obligations of the
MLP and the OLP hereunder is non-recourse to any partner thereof and
any and all assets of each such partner, save and except as
hereinabove provided.
-48-
519
IN WITNESS WHEREOF, this Agreement has been duly executed by
the parties hereto as of the date first above written.
CORNERSTONE PROPANE PARTNERS, L.P.
By: Cornerstone Propane GP, Inc.,
a California corporation,
as managing general partner
By: /s/ Xxxxxx X. Xxxxxx
---------------------------
Xxxxxx X. Xxxxxx
Vice President
Witnesses:
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
/s/ Xxxxxx Xxxx
-----------------------------------
CORNERSTONE PROPANE, L.P.
By: Cornerstone Propane GP, Inc.,
a California corporation,
as managing general partner
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Xxxxxx X. Xxxxxx
Vice President
Witnesses:
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
/s/ Xxxxxx Xxxx
-----------------------------------
-49-
520
CORNERSTONE PROPANE GP, INC.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx
Vice President
Witnesses:
/s/ Xxxxx X. Xxxxxx
-----------------------------------
/s/ Xxxxxx Xxxx
-----------------------------------
ATTEST:
/s/ Xxxxxx X. Xxxxxx
------------------------------------
Assistant Secretary
EMPIRE ENERGY SC CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx
President
Witnesses:
/s/ Xxxxx X. Xxxxxx
-----------------------------------
/s/ Xxxxxx Xxxx
-----------------------------------
ATTEST:
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
Assistant Secretary
-50-
521
SYN INC.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx
Vice President
Witnesses:
/s/ Xxxxx X. Xxxxxx
-----------------------------------
/s/ Xxxxxx Xxxx
-----------------------------------
ATTEST:
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
Assistant Xxxxxxxxx
-00-
000
XXXXX XX XXXXXXXX )
) SS.
COUNTY OF XXXX )
On this 17th day of December, 1996, before me, a Notary
Public in and for said state, personally appeared Xxxxxx X. Xxxxxx,
who being by me duly sworn did say that he is the Vice President of
CORNERSTONE PROPANE GP, INC., a California corporation and the
managing general partner of CORNERSTONE PROPANE PARTNERS, L.P., a
Delaware limited partnership, and that the foregoing instrument was
signed on behalf of said corporation and limited partnership and
acknowledged said instrument to be the free act and deed of said
corporation and limited partnership for the purposes therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal, the day and year last above written.
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Printed Name: Xxxxx X. Xxxxxxx
--------------------------
Notary Public in and for said State
[SEAL]
My commission expires:
January 18, 2000
----------------------
000
XXXXX XX XXXXXXXX )
) SS.
COUNTY OF XXXX )
On this 17th day of December, 1996, before me, a Notary
Public in and for said state, personally appeared Xxxxxx X. Xxxxxx,
who being by me duly sworn did say that he is the Vice President of
CORNERSTONE PROPANE GP, INC., a California corporation and the
managing general partner of CORNERSTONE PROPANE, L.P., a Delaware
limited partnership, and that the foregoing instrument was signed on
behalf of said corporation and limited partnership and acknowledged
said instrument to be the free act and deed of said corporation and
limited partnership for the purposes therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal, the day and year last above written.
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Printed Name: Xxxxx X. Xxxxxxx
--------------------------
Notary Public in and for said State
[SEAL]
My commission expires:
January 18, 2000
----------------------
000
XXXXX XX XXXXXXXX )
) SS.
COUNTY OF XXXX )
On this 17th day of December, 1996, before me, a Notary
Public in and for said state, personally appeared Xxxxxx X. Xxxxxx and
Xxxxxx X. Xxxxxx, who being by me duly sworn did say that Xxxxxx X.
Xxxxxx and Xxxxxx X. Xxxxxx are the Vice President and Assistant
Secretary, respectively, of CORNERSTONE PROPANE GP, INC., a California
corporation, and that the foregoing instrument was signed on behalf of
said corporation and acknowledged said instrument to be the free act
and deed of said corporation for the purposes therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal, the day and year last above written.
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Printed Name: Xxxxx X. Xxxxxxx
--------------------------
Notary Public in and for said State
[SEAL]
My commission expires:
January 18, 2000
----------------------
000
XXXXX XX XXXXXXXX )
) SS.
COUNTY OF XXXX )
On this 17th day of December, 1996, before me, a Notary
Public in and for said state, personally appeared Xxxxxx X. Xxxxxx and
Xxxxxx X. Xxxxxx, who being by me duly sworn did say that Xxxxxx X.
Xxxxxx and Xxxxxx X. Xxxxxx are the President and Secretary,
respectively, of EMPIRE ENERGY SC CORPORATION, a Delaware corporation,
and that the foregoing instrument was signed on behalf of said
corporation and acknowledged said instrument to be the free act and
deed of said corporation for the purposes therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal, the day and year last above written.
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Printed Name: Xxxxx X. Xxxxxxx
--------------------------
Notary Public in and for said State
[SEAL]
My commission expires:
January 18, 2000
----------------------
000
XXXXX XX XXXXXXXX )
) SS.
COUNTY OF XXXX )
On this 17th day of December, 1996, before me, a Notary
Public in and for said state, personally appeared Xxxxxx X. Xxxxxx and
Xxxxxx X. Xxxxxx, who being by me duly sworn did say that Xxxxxx X.
Xxxxxx and Xxxxxx X. Xxxxxx are the Vice President and Assistant
Secretary, respectively, of SYN INC., a Delaware corporation, and that
the foregoing instrument was signed on behalf of said corporation and
acknowledged said instrument to be the free act and deed of said
corporation for the purposes therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my official seal, the day and year last above written.
/s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Printed Name: Xxxxx X. Xxxxxxx
--------------------------
Notary Public in and for said State
[SEAL]
My commission expires:
January 18, 2000
----------------------
527
Schedule 1.1
ASSETS
"Assets" means and includes, as to any Transferor, the
following:
The interest of such Transferor in any and all of the assets
owned, leased or held by such Transferor and used or held for use in
the operation or planned operation of the Business of such Transferor
as of the Effective Time, of every kind, character and description,
whether tangible or intangible, whether real, personal or mixed,
whether accrued or contingent, and wheresoever located, including all
right, title and interest of such Transferor in and to the following
assets to the extent they are used in or relate to the Business of
such Transferor as operated and/or planned to be operated as of the
Effective Time:
(a) all liquefied petroleum gas inventory and all other
inventories and supplies of any kind (including appliance and parts
inventories);
(b) all storage tanks and containers and propane cylinders
(including tanks, containers and cylinders located at customer
locations);
(c) all office furniture, furnishings, computers, tools,
machinery and other equipment of any kind;
(d) all real property, wherever located, together with all
buildings, structures, improvements, equipment, appurtenances and
fixtures of every kind or nature located thereon;
(e) all rights in real property or personal property
arising under leases, easements or other contracts or arrangements;
(f) all motor and other vehicles, trailers, rolling stock
and related equipment, including any tanks or other equipment mounted
or attached thereon, whether owned or leased;
(g) all purchase orders, agreements with customers and
other contracts, agreements, arrangements and understandings of any
kind;
(h) all insurance coverages maintained by or for such
Transferor, and all proceeds and other rights and benefits relating to
such coverage;
(i) all rights, claims and causes of action against any
Person or property, whether known or unknown, accrued or contingent,
and whether or not reflected on the books and records as of the
Effective Time, insofar as any of the same arise out of or otherwise
528
relate to the condition or use of the Assets or the operation of the
Business of such Transferor prior to the Effective Time;
(j) all rights to sell or distribute any product or
service;
(k) all tradenames, trademarks, service marks, logos, marks
and symbols of any kind, together with all goodwill associated
therewith;
(l) all know-how, trade secrets, customer lists and all
other confidential information of every kind;
(m) all customer relationships, employee relationships,
supplier relationships and other relationships of any kind;
(n) all other proprietary rights of any kind;
(o) all governmental licenses, approvals, registrations,
permits and authorizations of every kind;
(p) all bank accounts and all cash or cash equivalents
(including short term investments and marketable securities) contained
in such bank accounts;
(q) all monies, rents, revenues, accounts, accounts
receivable, refunds or rights thereto or other amounts receivable by
or owing to such Transferor;
(r) all deposits, prepayments and prepaid expenses;
(s) all stock or other securities (whether equity, debt or
otherwise) of any other Person and any partnership interest or other
interest in any other Person, including all interests in joint
ventures held by such Transferor;
(t) all goodwill and all other intangible assets; and
(u) copies of all books, records, papers and instruments,
including accounting and financial records and other documentation;
provided, however, that notwithstanding anything to the contrary
contained herein or in any of the Transaction Documents, the term
"Assets" as to any Transferor shall not include the Excluded Assets of
such Transferor and for purposes of determining the Excluded Assets of
any Transferor the words "primarily in the continuing operation of the
Business" of a Transferor or words of similar import shall mean used
in the operation or planned operation of the Business and not
otherwise used primarily in the operation or planned operation of one
or more other businesses of the Transferor.
2
529
Schedule 1.2(A)
EXCLUDED MANAGING GP ASSETS
"Excluded Managing GP Assets" means and includes the
following:
(a) All refunds and rights to refunds of federal, state,
local and foreign income taxes and corporate franchise taxes relating
to any period of time prior to the Effective Time;
(b) All income tax returns and corporate franchise tax
returns of the Managing GP and its predecessors;
(c) All books and records which the Managing GP is required
to retain by law;
(d) The corporate seals, certificates of incorporation,
bylaws, minute books and stock ledger records of the Managing GP and
its predecessors;
(e) All assets, rights and properties of the Managing GP
not used or held primarily for the continuing operation of the
Business of the Managing GP;
(f) All books of account and other records, papers and
instruments of the Managing GP and its predecessors relating to the
Excluded Managing GP Liabilities or the matters described in this
Schedule;
(g) The Additional Acquisition Documents and all rights and
claims of the Managing GP, as the successor to EEC, made or which may
be made thereunder, including any recovery on account of such rights
and claims;
(h) The outstanding capital stock of SYN and SC and all
rights of the Managing GP as a stockholder of SYN and SC, including
all rights under that certain Agreement among SYN Inc. and its
Stockholders dated August 15, 1995 originally among SYN, NGC, ASG and
certain other parties, as amended;
(i) The SC Note;
(j) Insurance coverages maintained by or for the Managing
GP and all proceeds and other rights and benefits relating to such
coverage with respect to any Excluded Managing GP Liabilities;
(k) All rights of the Managing GP under that certain
Indemnification Agreement dated December 11, 1996 among the MLP, the
OLP, the Managing GP, SYN and NGC;
(l) All rights of the Managing GP under that certain Non-
Competition Agreement dated May 7, 1994 among the Managing GP, as the
530
successor to EEC, ASG and certain principals of EEC and ASG, as
amended;
(m) All defined benefit plans, defined contribution plans
and health and welfare plans maintained by the Managing GP or its
predecessors existing at the Effective Time;
(n) All rights of the Managing GP under the MLP Partnership
Agreement; and
(o) All rights of the Managing GP under the OLP Partnership
Agreement.
2
531
Schedule 1.2(B)
EXCLUDED SC ASSETS
"Excluded SC Assets" means and includes the following:
(a) All refunds and rights to refunds of federal, state,
local and foreign income taxes and corporate franchise taxes relating
to any period of time prior to the Effective Time;
(b) All income tax returns and corporate franchise tax
returns of SC;
(c) All books and records which SC is required to retain by
law;
(d) The corporate seal, certificate of incorporation,
bylaws, minute books and stock ledger records of SC;
(e) All assets, rights and properties of SC not used or
held primarily for the continuing operation of the Business of SC;
(f) All books of account and other records, papers and
instruments of SC relating to the Excluded SC Liabilities or the
matters described in this Schedule;
(g) Insurance coverages maintained by or for SC and all
proceeds and other rights and benefits relating to such coverage with
respect to any Excluded SC Liabilities;
(h) All defined benefit plans, defined contribution plans
and health and welfare plans maintained by SC existing at the
Effective Time;
(i) All rights of SC under the MLP Partnership Agreement;
and
(j) All rights of SC under the OLP Partnership Agreement.
532
Schedule 1.2(C)
EXCLUDED SYN ASSETS
"Excluded SYN Assets" means and includes the following:
(a) All refunds and rights to refunds of federal, state,
local and foreign income taxes and corporate franchise taxes relating
to any period of time prior to the Effective Time;
(b) All income tax returns and corporate franchise tax
returns of SYN and its predecessors;
(c) All books and records which SYN is required to retain
by law;
(d) The corporate seals, certificates of incorporation,
bylaws, minute books and stock ledger records of SYN and its
predecessors;
(e) All assets, rights and properties of SYN not used or
held primarily for the continuing operation of the Business of SYN;
(f) All books of account and other records, papers and
instruments of SYN and its predecessors relating to the Excluded SYN
Liabilities or to the matters described in this Schedule;
(g) All rights and claims of SYN made under the SYN
Acquisition Documents, and all related rights and claims of SYN which
may be made under the SYN Acquisition Documents and all rights under
the SYN Acquisition Documents related to any of the foregoing,
including any recovery on account of such rights and claims, any
rights under any escrow arrangements and any rights to any amounts
held or to be paid pursuant to such escrow arrangements.
(h) All rights and claims of SYN with respect to litigation
and claims which the Selling Stockholders are required to defend
pursuant to Section 10.1 of the SYN Purchase Agreement;
(i) The Additional Acquisition Documents and all rights and
claims of SYN made or which may be made thereunder, including any
recovery on account of such rights and claims;
(j) The outstanding capital stock of Claremont Gas
Corporation and any inactive subsidiaries of SYN;
(k) All rights of SYN under the Termination Agreement dated
September 28, 1996 among ASG, NGC and SYN;
(l) All rights of SYN under that certain Termination
Agreement dated December 13, 1996 among ASG, NGC and SYN;
533
(m) All rights of SYN under that certain Agreement among
SYN Inc. and its Stockholders dated August 15, 1995 originally among
SYN, NGC, ASG and certain other parties, as amended;
(n) All rights of SYN under that certain Indemnification
Agreement dated December 11, 1996 among the MLP, the OLP, the Managing
GP, SYN and NGC;
(o) All interests, if any, of SYN at the Effective Time in
any real property located in Claremont, New Hampshire or Bennington,
Vermont, and the improvements located thereon;
(p) Insurance coverages maintained by or for SYN and all
proceeds and other rights and benefits relating to such coverages with
respect to any Excluded SYN Liabilities;
(q) All defined benefit plans, defined contribution plans
and health and welfare plans maintained by SYN or its predecessors
existing at the Effective time;
(r) All rights of SYN under the MLP Partnership Agreement;
and
(s) All rights of SYN under the OLP Partnership Agreement.
2
534
Schedule 1.3(A)
EXCLUDED MANAGING GP LIABILITIES
"Excluded Managing GP Liabilities" means and includes the
following:
(a) The federal, state, local and foreign income tax and
corporate franchise tax liabilities of the Managing GP (including all
federal, state and local income tax liabilities attributable to the
operation of the Business prior to the Effective Time), including any
such income tax liabilities of the Managing GP that may result from
the consummation of the transactions contemplated by this Agreement;
(b) All liabilities and obligations of the Managing GP with
respect to the Excluded Managing GP Assets or any operation or
business other than the Business of the Managing GP;
(c) All liabilities and obligations of the Managing GP, as
the successor to EEC, pursuant to the Additional Acquisition
Documents;
(d) All liabilities and obligations of the Managing GP, as
the successor to EEC, with respect to the Excluded EEC Debt;
(e) All liabilities and obligations of the Managing GP as a
stockholder of SYN under that certain Agreement among SYN Inc. and its
Stockholders dated August 15, 1995 among SYN, NGC, ASG and certain
other parties as amended;
(f) All liabilities and obligations of the Managing GP
under that certain Non-Competition Agreement dated May 7, 1994 among
the Managing GP, as the successor to EEC, ASG and certain principals
of EEC and ASG, as amended;
(g) All liabilities and obligations of the Managing GP
under all defined benefit plans, defined contribution plans and health
and welfare plans maintained by the Managing GP or its predecessors at
the Effective Time;
(h) All liabilities and obligations of the Managing GP
under the MLP Partnership Agreement; and
(i) All liabilities and obligations of the Managing GP
under the OLP Partnership Agreement.
535
Schedule 1.3(B)
EXCLUDED SC LIABILITIES
"Excluded SC Liabilities" means and includes the following:
(a) The federal, state, local and foreign income tax and
corporate franchise tax liabilities of SC (including all federal,
state and local income tax liabilities attributable to the operation
of the Business prior to the Effective Time), including any such
income tax liabilities of SC that may result from the consummation of
the transactions contemplated by this Agreement;
(b) All liabilities and obligations of SC with respect to
the Excluded SC Assets or any operation or business other than the
Business of SC;
(c) All liabilities and obligations of SC under all defined
benefit plans, defined contribution plans and health and welfare plans
maintained by SC at the Effective Time;
(d) All liabilities and obligations of SC under the MLP
Partnership Agreement; and
(e) All liabilities and obligations of SC under the OLP
Partnership Agreement.
536
Schedule 1.3(C)
EXCLUDED SYN LIABILITIES
"Excluded SYN Liabilities" means and includes the following:
(a) The federal, state, local and foreign income tax and
corporate franchise tax liabilities of SYN (including all federal,
state and local income tax liabilities attributable to the operation
of the Business prior to the Effective Time), including any such
income tax liabilities of SYN that may result from the consummation of
the transactions contemplated by this Agreement;
(b) All liabilities and obligations of SYN with respect to
the Excluded SYN Assets or any operation or business other than the
Business of SYN;
(c) All liabilities and obligations of SYN pursuant to the
SYN Acquisition Documents (other than SYN's liabilities with respect
to the promissory note made by SYN to the order of The Bank of New
York in the principal amount of $1,250,000 in connection therewith);
(d) All liabilities and obligations of SYN pursuant to the
Additional Acquisition Documents (other than liabilities and
obligations reflected in the financial statements for which
adjustments were made in determining the consideration given to SYN
pursuant to this Agreement), but only when and to the extent of any
recovery (net of costs of collection allocated thereto) that is
received by SYN pursuant to the SYN Acquisition Documents on account
of the particular liability or obligation;
(e) The liabilities and obligations of SYN which form the
basis of SYN's existing claims against the Selling Stockholders
pursuant to the SYN Acquisition Documents (other than liabilities and
obligations reflected in the financial statements for which
adjustments were made in determining the consideration given to SYN
pursuant to this Agreement), but only when and to the extent of any
recovery (net of costs of collection allocated thereto) that is
received by SYN pursuant to the SYN Acquisition Documents on account
of the particular liability or obligation;
(f) All liabilities and obligations of SYN with respect to
litigation and claims which the Selling Stockholders are required to
defend pursuant to Section 10.1 of the SYN Purchase Agreement;
(g) All liabilities and obligations of SYN under the
Termination Agreement dated September 28, 1996 among ASG, NGC and SYN;
(h) All liabilities and obligations of SYN under that
certain Agreement among SYN Inc. and its Stockholders dated August 15,
1995 among SYN, NGC, ASG and certain other parties, as amended;
537
(i) All liabilities and obligations of SYN under that
certain Termination Agreement dated December 13, 1996 among ASG, NGC
and SYN and all liabilities and obligations under the Management
Agreement referred to therein which are not terminated thereby;
(j) All liabilities and obligations of SYN under all
defined benefit plans, defined contribution plans and health and
welfare plans maintained by SYN or its predecessors at the Effective
Time;
(k) All liabilities and obligations of SYN under the MLP
Partnership Agreement; and
(l) All liabilities and obligations of SYN under the OLP
Partnership Agreement.
2
538
Schedule 1.4
SERVICE ASSETS
"Service Assets" means, with respect to any Transferor, all
Assets, if any, used solely in the conduct of the appliance sales
business, parts and fittings sales business and service labor business
(collectively, the "Service Business") of such Transferor in the
States of Alabama, Arkansas, California, Missouri, New York or
Tennessee in relation to its propane business in such States,
including:
(a) copies of all books, records, papers and instruments of
such Transferor of whatever nature and wherever located that relate to
the Service Business, including accounting and financial records and
other documentation related to the Service Business;
(b) all inventory relating to the Service Business,
including appliances and parts and fittings;
(c) all purchase orders, agreements with customers and
other contracts, agreements, arrangements and understandings of any
kind relating to the Service Business; and
(d) every right to purchase, sell or distribute any
appliances, parts or fittings or to provide service relating to the
Service Businesses.
