1
EXHIBIT 10.4
================================================================================
FORM OF OMNIBUS AGREEMENT
among
THE ▇▇▇▇▇▇▇▇ COMPANIES INC.
▇▇▇▇▇▇▇▇ ENERGY SERVICES, LLC
▇▇▇▇▇▇▇▇ NATURAL GAS LIQUIDS, INC.
▇▇▇▇▇▇▇▇ PIPE LINE COMPANY, LLC
▇▇▇▇▇▇▇▇ INFORMATION SERVICES CORPORATION
▇▇▇▇▇▇▇▇ ENERGY PARTNERS ▇.▇.
▇▇▇▇▇▇▇▇ ▇▇▇, ▇.▇.
and
▇▇▇▇▇▇▇▇ ▇▇ LLC
================================================================================
2
OMNIBUS AGREEMENT
THIS OMNIBUS AGREEMENT is entered into on, and effective as of, the
Closing Date among The ▇▇▇▇▇▇▇▇ Companies Inc., a Delaware corporation
("▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇▇ Energy Services, LLC a Delaware limited liability company
("▇▇▇"), ▇▇▇▇▇▇▇▇ Natural Gas Liquids, Inc., a Delaware corporation ("WNGL"),
▇▇▇▇▇▇▇▇ Pipe Line Company, LLC, a Delaware limited liability company ("▇▇▇▇▇▇▇▇
Pipe Line"), ▇▇▇▇▇▇▇▇ Information Services Corporation, a Delaware corporation
("WISC"), ▇▇▇▇▇▇▇▇ Energy Partners L.P., a Delaware limited partnership (the
"MLP"), ▇▇▇▇▇▇▇▇ ▇▇ LLC, a Delaware limited liability company (the "General
Partner") and ▇▇▇▇▇▇▇▇ ▇▇▇, ▇.▇., a Delaware limited partnership (the "OLP").
RECITALS:
1. ▇▇▇▇▇▇▇▇, ▇▇▇, WNGL, the MLP, the OLP and the General Partner, in
its capacity as the general partner of the MLP and the OLP, desire by their
execution of this Agreement to evidence their understanding, as more fully set
forth in Article II of this Agreement, with respect to (a) those business
opportunities that ▇▇▇▇▇▇▇▇ will not avail itself of during the Applicable
Period unless each of the MLP and the OLP has declined to engage in such
business opportunity for its own account and (b) the procedures whereby such
business opportunities are to be offered to the MLP and the OLP and accepted or
declined.
2. ▇▇▇, WNGL, the General Partner, the MLP and the OLP desire by their
execution of this Agreement to evidence their understanding, as more fully set
forth in Article III of this Agreement, with respect to certain indemnification
obligations of ▇▇▇ and WNGL in favor of the Partnership Entities (as defined
herein).
3. ▇▇▇▇▇▇▇▇, ▇▇▇, WNGL, the General Partner, the MLP and the OLP desire
by their execution of this Agreement to evidence their understanding, as more
fully set forth in Article IV of this Agreement, with respect to the general and
administrative expenses to be reimbursed by the MLP to ▇▇▇▇▇▇▇▇ .
4. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ Pipe Line and WISC (the "Licensors") and the
Partnership Entities desire by their execution of this Agreement to evidence
their understanding, as more fully set forth in Article V of this Agreement,
with respect to grants of intellectual property from the Licensors to the
Partnership Entities.
5. ▇▇▇▇▇▇▇▇, ▇▇▇, WNGL, the General Partner, the MLP and the OLP desire
by their execution of this Agreement to evidence their understanding, as more
fully set forth in Article VI of this Agreement, with respect to certain capital
expenditures to be reimbursed by ▇▇▇▇▇▇▇▇ to the MLP.
In consideration of the premises and the covenants, conditions, and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
-2-
3
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. (a) Capitalized terms used herein but not defined
shall have the meanings given them in the MLP Agreement.
(b) As used in this Agreement, the following terms shall have
the respective meanings set forth below:
"Agreement" means this Omnibus Agreement, as it may be
amended, modified, or supplemented from time to time.
"Applicable Period" means the period commencing on the Closing
Date and terminating on the date on which the General Partner (or any
Person that directly, or indirectly through one or more intermediaries,
is controlled by or under common control with ▇▇▇▇▇▇▇▇) ceases to be
the general partner of the MLP and the OLP.
"Change of Control" means, with respect to any Person (the
"Applicable Person"), any of the following events: (i) any sale, lease,
exchange or other transfer (in one transaction or a series of related
transactions) of all or substantially all of the Applicable Person's
assets to any other Person unless immediately following such sale,
lease, exchange or other transfer such assets are owned, directly or
indirectly, by the Applicable Person; (ii) the consolidation or merger
of the Applicable Person with or into another Person pursuant to a
transaction in which the outstanding Voting Stock of the Applicable
Person is changed into or exchanged for cash, securities or other
property, other than any such transaction where (a) the outstanding
Voting Stock of the Applicable Person is changed into or exchanged for
Voting Stock of the surviving corporation or its parent and (b) the
holders of the Voting Stock of the Applicable Person immediately prior
to such transaction own, directly or indirectly, not less than a
majority of the Voting Stock of the surviving corporation or its parent
immediately after such transaction; and (iii) a "person" or "group"
(within the meaning of Sections 13(d) or 14(d)(2) of the Exchange Act)
being or becoming the "beneficial owner" (as defined in Rules 13d-3 and
13d-5 under the Exchange Act) of more than 50% of all of the then
outstanding Voting Stock of the Applicable Person, except in a merger
or consolidation which would not constitute a Change of Control under
clause (ii) above.
"Closing Date" means the date of the closing of the initial
public offering of common units representing limited partner interests
in the MLP.
"Conflicts Committee" is defined in the MLP Agreement.
"Control" 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.
"Covered Environmental Losses" is defined in Section 3.1.
-3-
4
"Environmental Laws" means all federal, state, and local laws,
statutes, rules, regulations, orders, and ordinances relating to
protection of health and the environment including, without limitation,
the federal Comprehensive Environmental Response, Compensation, and
Liability Act, the Superfund Amendments Reauthorization Act, the
Resource Conservation and Recovery Act, the Clean Air Act, the Federal
Water Pollution Control Act, the Toxic Substances Control Act, the Oil
Pollution Act, the Safe Drinking Water Act, the Hazardous Materials
Transportation Act, and other environmental conservation and protection
laws, each as amended through the Closing Date.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"General Partner" means the General Partner and its successors
as general partner of the MLP and the OLP, unless the context otherwise
requires.
"Licensees" means, for purposes of Article V hereof, the
Partnership Entities.
"Licensors" means, for purposes of Article V hereof, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ Pipe Line Company and WISC.
"Marks" means (i) all trademarks, tradenames, logos and/or
service marks identified on Schedule I attached hereto and (ii) those
trademarks, tradenames, service marks or logos associates with the
Licensor(s)' Software, Inventions or with the subject matter of other
licenses granted hereunder.
"MLP Agreement" means the Amended and Restated Agreement of
Limited Partnership of the MLP, dated as of the Closing Date, as such
agreement is in effect on the Closing Date, to which reference is
hereby made for all purposes of this Agreement. No amendment or
modification to the MLP Agreement subsequent to the Closing Date shall
be given effect for the purposes of this Agreement unless consented to
by each of the parties to this Agreement.
"Offer" is defined in Section 2.3.
"Partnership Entities" means the General Partner, the MLP, the
OLP and any Person controlled by the General Partner, the MLP or the
OLP.
"Partnership Group" means the MLP, the OLP and any Person
controlled by such entities.
"Person" means an individual, corporation, partnership, joint
venture, trust, limited liability company, unincorporated organization
or any other entity.
"Restricted Assets" is defined in Section 2.1.
"Software" means, with respect to the software programs
identified on Schedule I attached hereto as such exist on the Closing
Date, the source code, the object code, any
-4-
5
enhancements, upgrades, modifications and new versions, and any
documentation and instructions regarding use that Licensors may, in
their discretion, provide to Licensees.
"Voting Stock" means securities of any class of ▇▇▇▇▇▇▇▇
entitling the holders thereof to vote on a regular basis in the
election of members of the board of directors of ▇▇▇▇▇▇▇▇.
"▇▇▇" is defined in the introduction to this Agreement.
"▇▇▇▇▇▇▇▇" is defined in the introduction to this Agreement.
"▇▇▇▇▇▇▇▇ Entities" means ▇▇▇▇▇▇▇▇ and any Person controlled
by ▇▇▇▇▇▇▇▇, other than the Partnership Entities.
"WNGL" is defined in the introduction to this Agreement.
ARTICLE II
BUSINESS OPPORTUNITIES
2.1 RESTRICTED ASSETS. During the Applicable Period, each of the
▇▇▇▇▇▇▇▇ Entities shall be prohibited from engaging in or acquiring any business
having assets engaged in the following activities ("Restricted Assets"): (a) the
transportation, storage or distribution of ammonia or related products in the
United States and (b) the ownership and operation of facilities for the
terminalling and storage of refined petroleum products in any state in the
United States, except Alaska and Hawaii.
2.2 PERMITTED EXCEPTIONS. Notwithstanding any provision of Section 2.1
to the contrary, a ▇▇▇▇▇▇▇▇ Entity may own and operate Restricted Assets under
the following circumstances:
(a) The Restricted Assets were owned, leased or operated by
the ▇▇▇▇▇▇▇▇ Entities on the date of this Agreement.
(b) The value of the Restricted Assets acquired in a
transaction does not exceed $20 million at the time of the acquisition, as
determined by the Board of Directors of ▇▇▇, in its sole discretion.
(c) (i) The value of the Restricted Assets acquired in a
transaction exceeds $20 million at the time of acquisition, as determined by the
Board of Directors of ▇▇▇, in its sole discretion and (ii) the General Partner
(with the approval of the Conflicts Committee) has elected not to cause a member
of the Partnership Group to pursue such opportunity in accordance with the
procedures set forth in Section 2.3.
(d) The original cost of Restricted Assets constructed by a
▇▇▇▇▇▇▇▇ Entity does not exceed $20 million, as determined by the Board of
Directors of ▇▇▇, in its sole discretion.
-5-
6
(e) (i) The original cost of Restricted Assets constructed by
a ▇▇▇▇▇▇▇▇ Entity exceeds $20 million, as determined by the Board of Directors
of ▇▇▇, in its sole discretion and (ii) the General Partner (with the approval
of the Conflicts Committee) has elected not to cause a member of the Partnership
Group to pursue such opportunity in accordance with the procedures set forth in
Section 2.3.
(f) The Restricted Assets, at the time of acquisition or
construction, are either connected to assets owned by the ▇▇▇▇▇▇▇▇ Entities or
are primarily related to the operations or business of, and are located within
50 miles of, the refinery owned by ▇▇▇▇▇▇▇▇ in Memphis, Tennessee.
2.3 PROCEDURES. In the event that a ▇▇▇▇▇▇▇▇ Entity acquires or
constructs Restricted Assets valued or having an original cost in excess of $20
million at the time of the acquisition or the completion of construction, as
determined by the Board of Directors of ▇▇▇, then not later than six months
after the consummation of the acquisition and not later than one year after the
completion of construction by such ▇▇▇▇▇▇▇▇ Entity of the Restricted Assets,
such ▇▇▇▇▇▇▇▇ Entity shall notify the General Partner of such purchase or
construction and offer the MLP the opportunity to purchase such Restricted
Assets. As soon as practicable, but in any event, within 60 days after receipt
of such notification, the General Partner shall notify the ▇▇▇▇▇▇▇▇ Entity that
either (i) the General Partner has elected, with the approval of the Conflicts
Committee, not to cause a member of the Partnership Group to purchase such
Restricted Assets, in which event the ▇▇▇▇▇▇▇▇ Entity shall be forever free to
continue to own or operate such Restricted Assets, or (ii) the General Partner
has elected to cause a member of the Partnership Group to purchase such
Restricted Assets, in which event the following procedures shall be followed:
(a) Within 30 days of receipt of the notice from the General
Partner that the General Partner has elected to cause a member of the
Partnership Group to purchases the Restricted Assets, the ▇▇▇▇▇▇▇▇ Entity shall
submit an offer to the General Partner to sell the Restricted Assets (the
"Offer") to any member of the Partnership Group on the terms and for the
consideration stated in the Offer.
(b) The ▇▇▇▇▇▇▇▇ Entity and the General Partner shall
negotiate after receipt of such Offer by the General Partner, the terms on which
the Restricted Assets will be sold to a member of the Partnership Group. The
▇▇▇▇▇▇▇▇ Entity shall provide all information concerning the business,
operations and finances of such Restricted Assets as may be reasonably requested
by the General Partner.
(i) If the ▇▇▇▇▇▇▇▇ Entity and the General Partner
agree on such terms within 60 days after receipt by the General Partner
of the Offer, a member of the Partnership Group shall purchase the
Restricted Assets on such terms as soon as commercially practicable
after such agreement has been reached.
(ii) If the ▇▇▇▇▇▇▇▇ Entity and the General Partner
are unable to agree on the terms of a sale during the 60-day period
after receipt by the General Partner of the Offer, the ▇▇▇▇▇▇▇▇ Entity
and the General Partner will engage an independent investment banking
firm with a national reputation to determine the fair market value of
the Restricted Assets. In determining the fair market value of the
Restricted Assets, the
-6-
7
investment banking firm will have access to the proposed sale and
purchase values for the submitted by ▇▇▇▇▇▇▇▇ and the General Partner,
respectively. Such investment banking firm will determine the value of
the Restricted Assets within 30 days and furnish the ▇▇▇▇▇▇▇▇ Entity
and the General Partner its opinion of such value. The fees of the
investment banking firm's appraisal will be split equally between
▇▇▇▇▇▇▇▇ and the MLP. Upon receipt of such opinion, the General Partner
will have the option, but not the obligation, subject to the approval
of the Conflicts Committee, to:
(iii) (A) cause a member of the Partnership Group to
purchase the Restricted Assets in accordance with the
following process:
(1) if the valuation of the investment
banking firm is in the range between the proposed
sale/purchase values of ▇▇▇▇▇▇▇▇ and the General
Partner, a member of the Partnership Group will have
the right to purchase the Restricted Assets at the
valuation submitted by the investment banking firm;
(2) if the valuation of the investment
banking firm is less than the proposed purchase value
submitted by the General Partner, a member of the
Partnership Group will have the right to purchase the
Restricted Assets for the amount submitted by the
General Partner; and
(3) if the valuation of the investment
banking firm is greater than the proposed sale value
submitted by ▇▇▇▇▇▇▇▇, a member of the Partnership
Group will have the right to purchase the Restricted
Assets for the amount submitted by ▇▇▇▇▇▇▇▇; or
(B) decline to purchase such , in which event the
▇▇▇▇▇▇▇▇ Entity forever will be free to continue to own and
operate such Restricted Assets.
2.4 SCOPE OF PROHIBITION. Except as provided in this Article II and the
Partnership Agreement, each ▇▇▇▇▇▇▇▇ Entity shall be free to engage in any
business activity whatsoever, including those that may be in direct competition
with any Partnership Entity.
2.5 ENFORCEMENT. The ▇▇▇▇▇▇▇▇ Entities agree and acknowledge that the
Partnership Group does not have an adequate remedy at law for the breach by the
▇▇▇▇▇▇▇▇ Entities of the covenants and agreements set forth in this Article II,
and that any breach by the ▇▇▇▇▇▇▇▇ Entities of the covenants and agreements set
forth in Article II would result in irreparable injury to the Partnership Group.
The ▇▇▇▇▇▇▇▇ Entities further agree and acknowledge that any member of the
Partnership Group may, in addition to the other remedies which may be available
to the Partnership Group, file a suit in equity to enjoin the ▇▇▇▇▇▇▇▇ Entities
from such breach, and consent to the issuance of injunctive relief under this
Agreement.
ARTICLE III
INDEMNIFICATION
3.1 ▇▇▇▇▇▇▇▇ ENERGY SERVICES ENVIRONMENTAL INDEMNIFICATION. ▇▇▇ shall
indemnify, defend and hold harmless the Partnership Entities from and against
any Covered
-7-
8
Environmental Losses relating to the petroleum product facilities and the
ammonia pipeline and terminal facilities acquired by a predecessor of any of the
Partnership Entities, prior to the Closing Date (the "Facilities") that become
known within three years after the Closing Date and that exceed all amounts
recovered or recoverable by any Partnership Entity under contractual indemnities
from third Persons or under any applicable insurance policies. "Covered
Environmental Losses" mean those non-contingent environmental losses, costs,
damages and expenses suffered or incurred by the Partnership Entities arising
from correction of violations of, or performance of remediation required by,
Environmental Laws in effect at the Closing Date due to events and conditions
associated with the operation of the Facilities and occurring before the Closing
Date.
3.2 LIMITATIONS REGARDING ENVIRONMENTAL INDEMNIFICATION. ▇▇▇ shall have
no indemnification obligation under Section 3.1 for claims made after the third
anniversary of the date of this Agreement. The aggregate liability of ▇▇▇ in
respect of all Covered Environmental Losses under Section 3.1 shall not exceed
$15 million.
3.3 WNGL RIGHT OF WAY INDEMNIFICATION. WNGL shall indemnify, defend and
hold harmless the Partnership Entities and their successors or assigns for a
period of 15 years after the Closing Date from and against any losses, costs,
damages, expenses and fees suffered or incurred by any of the Partnership
Entities or their successors or assigns as a result of (a) the failure of
▇▇▇▇▇▇▇▇ Ammonia Pipeline, L.P. or its successors or assigns to be the owner of
valid and indefeasible easement rights in and to the easements and rights of way
in which the ammonia pipeline is located as of the Closing Date that are
necessary to enable ▇▇▇▇▇▇▇▇ Ammonia Pipeline, L.P. and its successors and
assigns to continue to own and operate the ammonia pipeline in all material
respects in the manner that it has been owned and operated as of the Closing
Date; and (b) the failure of ▇▇▇▇▇▇▇▇ Ammonia Pipeline, L.P. or its successors
and assigns to have the consents and permits necessary to allow such pipeline to
cross the roads, waterways, railroads and other areas upon which the ammonia
pipeline is located as of the Closing Date.
3.4 ▇▇▇▇▇▇▇▇ ENERGY SERVICES RIGHT OF WAY INDEMNIFICATION. ▇▇▇ shall
indemnify, defend and hold harmless, the Partnership Entities and their
successors and assigns, for a period of 15 years after the Closing Date, from
and against any losses, costs, damages, expenses and fees suffered or incurred
by any of the Partnership Entities or their successors or assigns as a result of
(a) the failure of ▇▇▇▇▇▇▇▇ Terminals Holdings, L.P. or its successors and
assigns to be the owner of valid and indefeasible easement rights in and to the
easements and rights of way in which the pipelines that are associated with the
marine terminal facilities at Galena Park, Texas, Corpus Christi, Texas and
Marrero, Louisiana are located, as of the Closing Date, that are necessary to
enable ▇▇▇▇▇▇▇▇ Terminals Holdings, L.P. and its successors and assigns to
continue to own and operate the pipelines in all material respects in the manner
that such pipelines have been owned and operated, prior to the Closing Date; and
(b) the failure of ▇▇▇▇▇▇▇▇ Terminals Holdings, L.P. or its successors and
assigns to have the consents and permits necessary to allow such pipelines to
cross roads, waterways, railroads and other areas upon which such pipelines are
located as of the Closing Date.
-8-
9
3.5 INDEMNIFICATION PROCEDURES.
(a) The Partnership Entities agree that within a reasonable
period of time after they become aware of facts giving rise to a claim
for indemnification pursuant to Section 3.1 or Section 3.3, they will
provide notice thereof in writing to ▇▇▇ or WNGL, as applicable,
specifying the nature of and specific basis for such claim.
(b) ▇▇▇ or WNGL, as applicable, shall have the right to
control all aspects of the defense of (and any counterclaims with
respect to) any claims brought against the Partnership Entities that
are covered by the indemnification set forth in Section 3.1 and Section
3.3, including, without limitation, the selection of counsel,
determination of whether to appeal any decision of any court and the
settling of any such matter or any issues relating thereto; provided,
however, that no such settlement shall be entered into without the
consent of the Partnership Entities unless it includes a full release
of the Partnership Entities from such matter or issues, as the case may
be.
(c) The Partnership Entities agree, at their own cost and
expense, to cooperate fully with ▇▇▇ or WNGL, as applicable, with
respect to all aspects of the defense of any claims covered by the
indemnification set forth in Section 3.1 and Section 3.3, including,
without limitation, the prompt furnishing to ▇▇▇ or WNGL, as
applicable, of any correspondence or other notice relating thereto that
the Partnership Entities may receive, permitting the names of the
Partnership Entities to be utilized in connection with such defense,
the making available to ▇▇▇ or WNGL, as applicable, of any files,
records or other information of the Partnership Entities that ▇▇▇ or
WNGL considers relevant to such defense and the making available to ▇▇▇
or WNGL, as applicable, of any employees of the Partnership Entities;
provided, however, that in connection therewith ▇▇▇ and WNGL agree to
use reasonable efforts to minimize the impact thereof on the operations
of such Partnership Entities. In no event shall the obligation of the
Partnership Entities to cooperate with ▇▇▇ or WNGL as set forth in the
immediately preceding sentence be construed as imposing upon the
Partnership Entities an obligation to hire and pay for counsel in
connection with the defense of any claims covered by the
indemnification set forth in this Article III; provided, however, that
the Partnership Entities may, at their own option, cost and expense,
hire and pay for counsel in connection with any such defense. ▇▇▇ and
WNGL agree to keep any such counsel hired by the Partnership Entities
reasonably informed as to the status of any such defense, but ▇▇▇ and
WNGL, as applicable, shall have the right to retain sole control over
such defense.
(d) In determining the amount of any loss, cost, damage or
expense for which any of the Partnership Entities are entitled to
indemnification under this Agreement, the gross amount of the
indemnification will be reduced by (i) any insurance proceeds realized
or to be realized by the Partnership Entities, and such correlative
insurance benefit shall be net of any incremental insurance premium
that becomes due and payable by the Partnership Entities as a result of
such claim and (ii) all amounts recovered or recoverable by any
Partnership Entity under contractual indemnities from third Persons as
described in Section 3.1
-9-
10
ARTICLE IV
GENERAL AND ADMINISTRATIVE EXPENSES
4.1 INITIAL GENERAL AND ADMINISTRATIVE EXPENSES. The initial general
and administrative expenses to be reimbursed by the MLP to ▇▇▇▇▇▇▇▇ will not
exceed $6 million for the year 2001, excluding expenses associated with
incentive compensation plans (the "Baseline G&A"). The Baseline G&A will be
prorated to reflect the actual number of months for which services are actually
provided to the MLP by ▇▇▇▇▇▇▇▇, including the entirety of the month in which
such services begin.
4.2 SUBSEQUENT GENERAL AND ADMINISTRATIVE EXPENSES. The Baseline G&A
may increase only as follows during the first ten years of the MLP:
(a) Each year, the Baseline G&A (as adjusted in accordance
with this Article IV) may be increased by no more than the greater of
7% per year or the percentage increase in the producer price index.
(b) If the Partnership Group makes an acquisition, the
Baseline G&A will be increased based upon the amount of general and
administrative expense included in the valuation of such acquisition
made by the General Partner on a pro forma basis for the succeeding
four fiscal quarters. The portion of this pro forma amount that is
proportionate to the remainder of the MLP fiscal year in which the
acquisition is made will be added to the Baseline G&A for that year.
The entire pro forma amount will be added to Baseline G&A in the
succeeding fiscal years.
ARTICLE V
LICENSE AGREEMENT
5.1 GRANT OF LICENSE. Subject to the terms and conditions herein, the
Licensors hereby grant to each Licensee, and each Licensee hereby accepts, a
non-exclusive, world-wide, non-transferable, royalty-free, perpetual license
during the term of this Agreement on an "AS IS, WHERE IS" basis to use the
Software solely for the internal use by each Licensee's employees for the
benefit of such Licensee and any Person directly or indirectly controlled by or
under common control with such Licensee, but specifically excluding use for the
benefit of or for providing services to or disclosure to any third parties
including, without limitation, any customer of such Licensee.
5.2 RESTRICTIONS ON SOFTWARE.
5.3 (a) Each of the Licensees agrees that it shall not sublicense,
license, disclose or otherwise make available any part of the Software
to any person other than: (i) Each of Licensee's employees who is
required to have access to the Software and who has agreed to
obligations of confidence consistent with the restrictions set forth in
this Agreement; and (ii) each of Licensee's consultants who is required
to have access to the Software and who has executed, in advance of any
such disclosure, non-disclosure agreements containing obligations of
confidence consistent with the restrictions set forth in this
Agreement.
-10-
11
(b) Each Licensee shall keep the Software in a secure
environment and shall take reasonable commercial steps necessary to
protect the Software, or any part thereof, from unauthorized disclosure
or release.
(c) Each Licensee shall be entitled to create a sufficient
number of copies of the Software for backup and archival purposes only
provided that such Licensee reproduces and applies all copyright
notices and any other proprietary rights notices that appear on the
original copies supplied by Licensors. Licensees shall not be permitted
to adapt, create derivative works of, translate, perform or display
publicly, port or otherwise modify the Software.
(d) Each of the Licensees agrees that it shall not use the
Software for any development or analysis purposes whatsoever and that
it shall not decompile or reverse engineer the Software.
(e) Each Licensee acknowledges and agrees that Licensors shall
own all intellectual property rights in and to the Software.
5.4 GRANT OF LICENSE. Subject to the terms and conditions herein,
Licensors hereby grant to Licensees the right and license to use the Marks
solely in connection with the Licensees' businesses and the services performed
therewith within the United States during the term of this Agreement.
5.5 RESTRICTIONS ON MARKS. In order to ensure the quality of uses under
the Marks, and to protect the goodwill of the Marks, Licensees agree as follows:
(a) Licensees will only use the Marks in formats approved by
Licensors and only in strict association with the Licensees' businesses
and the services performed therewith, and will not use the Marks in
association with any advertising or promotional materials except as
approved in writing by Licensors;
(b) Prior to publishing any new format or appearance of the
Marks or the advertising or promotional materials, Licensees shall
first provide such format, appearance or materials to Licensors for its
approval. If Licensors do not inform Licensees in writing within
fourteen (14) days from the date of the receipt of such new format,
appearance, or materials that such new format, appearance, or materials
is acceptable, then such new format, appearance or materials shall be
deemed to be unacceptable and dis-approved by Licensors. Licensors may
withhold approval of any proposed changes to the format, appearance or
materials which Licensees propose to use in Licensors' sole discretion;
(c) Licensees shall not use any other trademarks, service
marks, trade names or logos in connection with the Marks or use the
Marks or any trademark or servicemark similar to the Marks after the
termination of this Agreement. Licensors will not use the Marks in such
a manner so as to impair the validity or enforceability or in any way
disparage or dilute the Marks.
-11-
12
5.6 OWNERSHIP. Licensors shall own all right, title and interest,
including all goodwill relating thereto, in and to the Marks, and all trademark
rights embodied therein shall at all times be solely vested in Licensor.
Licensors shall also own all right, title, and interest in and to the Software.
Licensee has no right, title, interest or claim of ownership in the Marks or the
Software, except for the licenses granted in this Agreement. All use of the
Marks shall inure to the benefit of Licensor. Licensee agrees that it will not
attack the title of Licensor in and to the Marks or the Software.
5.7 CONFIDENTIALITY. The Licensees shall maintain strictest confidence
all confidential or nonpublic information or material disclosed by Licensors
embodied in or reflected in the Software and in the materials supplied hereunder
in connection with the license of the Marks, whether in writing or orally and
whether or not marked as confidential. Such confidential information includes,
but is not limited to, algorithms, inventions, ideas, processes, computer system
architecture and design, operator interfaces, operational systems, technical
information, technical specifications, training and instruction manuals, and the
like. In furtherance of the foregoing confidentiality obligation, Licensees
shall limit disclosure of such Software and other confidential information to
those of their employees, contractors or agents having a need to access the
Software and confidential information for the purpose of exercising rights
granted hereunder.
5.8 ESTOPPEL. Nothing in this Agreement shall be construed as
conferring by implication, estoppel, or otherwise upon Licensees (a) any license
or other right under the intellectual property rights of Licensors other than
the license granted herein to the Software and Marks as set forth expressly
herein or (b) any license rights other than those expressly granted herein.
5.9 WARRANTIES; DISCLAIMERS.
(a) The Licensors represent and warrant that they own and have
the right to license the Software and the Marks licensed under this Agreement.
(b) EXCEPT FOR THE WARRANTIES AND REPRESENTATIONS DESCRIBED IN
SECTION 5.8(a), LICENSOR DISCLAIMS ANY AND ALL WARRANTIES, CONDITIONS OR
REPRESENTATIONS (EXPRESS OR IMPLIED, ORAL OR WRITTEN) WITH RESPECT TO THE
SUBJECT MATTER HEREOF, OR ANY PART THEREOF, INCLUDING ANY AND ALL IMPLIED
WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS OR SUITABILITY FOR
ANY PURPOSE (WHETHER THE PARTY KNOWS, HAS REASON TO KNOW, HAS BEEN ADVISED, OR
IS OTHERWISE IN FACT AWARE OF ANY SUCH PURPOSE) WHETHER ALLEGED TO ARISE BY LAW,
BY REASON OF CUSTOM OR USAGE IN THE TRADE OR BY COURSE OF DEALING. THE SOFTWARE
AND DOCUMENTATION LICENSED HEREUNDER IS LICENSED "AS IS" AND LICENSEES AGREE
THAT THE SOFTWARE MAY HAVE BUGS AND THAT INTERRUPTIONS IN ITS OPERATION MAY
OCCUR.
-12-
13
5.10 INDEMNIFICATION.
(a) Each Licensee shall jointly and severally, and to the
fullest extent permitted by applicable law, defend, indemnify and hold harmless
the Licensors and their respective successors and assigns authorized hereunder
and any of their respective officers, directors, employees, agents and
representatives from and against any and all claims, demands, damages, losses,
costs and expenses arising out of or related in any way to this Article V to the
extent such claims are attributable to Licensee's failure to comply with its
obligations under this Article V or Licensee's negligence or the negligence of
Licensee's employees, agents, subcontractors or other representatives regarding
this Article V.
(b) Each Licensor shall jointly and severally, and to the
fullest extent permitted by applicable law, defend, indemnify and hold harmless
the Licensees and their respective successors and assigns authorized hereunder
and any of their respective officers, directors, employees, agents and
representatives from and against any and all claims, demands, damages, losses,
costs and expenses arising out of or related in any way to this Article V to the
extent such claims are attributable to Licensor's failure to comply with its
obligations under this Article V or Licensor's negligence or the negligence of
Licensor's employees, agents, subcontractors or other representatives regarding
this Article V.
ARTICLE VI
CAPITAL EXPENDITURES
6.1 ▇▇▇▇▇▇▇▇ REIMBURSEMENT OF PARTNERSHIP GROUP CAPITAL EXPENDITURES.
▇▇▇▇▇▇▇▇ will reimburse the Partnership Group for maintenance capital
expenditures in excess of $4.9 million made by the Partnership Group in each
year over a two year period beginning in the year 2001, subject to a maximum
aggregate reimbursement of $15.0 million over the two year period.
ARTICLE VII
MISCELLANEOUS
7.1 CHOICE OF LAW; SUBMISSION TO JURISDICTION. This Agreement shall be
subject to and governed by the laws of the State of Oklahoma, excluding any
conflicts-of-law rule or principle that might refer the construction or
interpretation of this Agreement to the laws of another state. Each party hereby
submits to the jurisdiction of the state and federal courts in the State of
Oklahoma and to venue in Tulsa, Oklahoma.
7.2 NOTICE. All notices or requests or consents provided for or
permitted to be given pursuant to this Agreement must be in writing and must be
given by depositing same in the United States mail, addressed to the Person to
be notified, postpaid, and registered or certified with return receipt requested
or by delivering such notice in person or by telecopier or telegram to such
party. Notice given by personal delivery or mail shall be effective upon actual
receipt. Notice given by telegram or telecopier shall be effective upon actual
receipt if received during the recipient's normal business hours, or at the
beginning of the recipient's next business day after receipt if not received
during the recipient's normal business hours. All notices to be sent to a party
pursuant to this Agreement shall be sent to or made at the address set forth
below such
-13-
14
party's signature to this Agreement, or at such other address as such party may
stipulate to the other parties in the manner provided in this Section 7.2.
7.3 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the parties relating to the matters contained herein, superseding all prior
contracts or agreements, whether oral or written, relating to the matters
contained herein.
7.4 TERMINATION. This Agreement will terminate upon a Change in Control
of the General Partner. In addition, the provisions of Article II of this
Agreement may be terminated by ▇▇▇▇▇▇▇▇ upon a Change of Control of ▇▇▇▇▇▇▇▇. In
the event of termination of this Agreement, the Licensee's right to utilize or
possess the Software and the Marks licensed under this Agreement shall
automatically cease. Within 15 days after the termination of this Agreement, the
Licensees shall (i) return to Licensors or destroy the original and all copies,
in any form, of all Software and Inventions, or parts thereof, for which it has
received a license hereunder and (ii) provide a certified affidavit executed by
an officer of the Licensees to the effect that the destruction has been
completed.
7.5 EFFECT OF WAIVER OR CONSENT. No waiver or consent, express or
implied, by any party to or of any breach or default by any Person in the
performance by such Person of its obligations hereunder shall be deemed or
construed to be a consent or waiver to or of any other breach or default in the
performance by such Person of the same or any other obligations of such Person
hereunder. Failure on the part of a party to complain of any act of any Person
or to declare any Person in default, irrespective of how long such failure
continues, shall not constitute a waiver by such party of its rights hereunder
until the applicable statute of limitations period has run.
7.6 AMENDMENT OR MODIFICATION. This Agreement may be amended or
modified from time to time only by the written agreement of all the parties
hereto; provided, however, that the MLP and the OLP may not, without the prior
approval of the Conflicts Committee, agree to any amendment or modification of
this Agreement that, in the reasonable discretion of the General Partner, will
adversely affect the holders of Common Units. Each such instrument shall be
reduced to writing and shall be designated on its face an "Amendment" or an
"Addendum" to this Agreement.
7.7 ASSIGNMENT. No party shall have the right to assign its rights or
obligations under this Agreement without the consent of the other parties
hereto.
7.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if all signatory parties had signed the
same document. All counterparts shall be construed together and shall constitute
one and the same instrument.
7.9 SEVERABILITY. If any provision of this Agreement or the application
thereof to any Person or circumstance shall be held invalid or unenforceable to
any extent, the remainder of this Agreement and the application of such
provision to other Persons or circumstances shall not be affected thereby and
shall be enforced to the greatest extent permitted by law.
7.10 GENDER, PARTS, ARTICLES AND SECTIONS. Whenever the context
requires, the gender of all words used in this Agreement shall include the
masculine, feminine and neuter, and the
-14-
15
number of all words shall include the singular and plural. All references to
Article numbers and Section numbers refer to Articles and Sections of this
Agreement.
7.11 FURTHER ASSURANCES. In connection with this Agreement and all
transactions contemplated by this Agreement, each signatory party hereto agrees
to execute and deliver such additional documents and instruments and to perform
such additional acts as may be necessary or appropriate to effectuate, carry out
and perform all of the terms, provisions and conditions of this Agreement and
all such transactions.
7.12 WITHHOLDING OR GRANTING OF CONSENT. Each party may, with respect
to any consent or approval that it is entitled to grant pursuant to this
Agreement, grant or withhold such consent or approval in its sole and
uncontrolled discretion, with or without cause, and subject to such conditions
as it shall deem appropriate.
7.13 U.S. CURRENCY. All sums and amounts payable to or to be payable
pursuant to the provisions of this Agreement shall be payable in coin or
currency of the United States of America that, at the time of payment, is legal
tender for the payment of public and private debts in the United States of
America.
7.14 LAWS AND REGULATIONS. Notwithstanding any provision of this
Agreement to the contrary, no party this Agreement shall be required to take any
act, or fail to take any act, under this Agreement if the effect thereof would
be to cause such party to be in violation of any applicable law, statute, rule
or regulation.
7.15 NEGOTIATION OF RIGHTS OF LIMITED PARTNERS, ASSIGNEES, AND THIRD
PARTIES. The provisions of this Agreement are enforceable solely by the parties
to this Agreement, and no Limited Partner, Assignee or other Person of the MLP
or the OLP shall have the right, separate and apart from the MLP or the OLP, to
enforce any provision of this Agreement or to compel any party to this Agreement
to comply with the terms of this Agreement.
-15-
16
IN WITNESS WHEREOF, the Parties have executed this Agreement on, and
effective as of, the Closing Date.
THE ▇▇▇▇▇▇▇▇ COMPANIES INC.
By:
-------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ENERGY SERVICES, LLC
By:
-------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ NATURAL GAS LIQUIDS, INC.
By:
-------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
17
▇▇▇▇▇▇▇▇ PIPE LINE COMPANY, LLC
By:
-------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ INFORMATION SERVICES CORPORATION
By:
-------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ENERGY PARTNERS L.P.
By: ▇▇▇▇▇▇▇▇ ▇▇ LLC, its sole
general partner
By: ▇▇▇▇▇▇▇▇ Energy Services
By:
---------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: [(▇▇▇) ▇▇▇-▇▇▇▇]
18
▇▇▇▇▇▇▇▇ ▇▇▇, ▇.▇.
By: ▇▇▇▇▇▇▇▇ ▇▇ LLC, its sole
general partner
By: ▇▇▇▇▇▇▇▇ Energy Services
By:
---------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: [(▇▇▇) ▇▇▇-▇▇▇▇]
▇▇▇▇▇▇▇▇ ▇▇ LLC
By: ▇▇▇▇▇▇▇▇ Energy Services
By:
-------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: [(▇▇▇) ▇▇▇-▇▇▇▇]
19
SCHEDULE I
INTELLECTUAL PROPERTY
Software and Inventions:
Automated Transportation Logistics Activity System, a/k/a "Atlas 2000"
Terminal Automation System, a/k/a "TAS"
Scquire
Manage and Analyze Geographic Inventory Control, a/k/a "MAGIC"
Supervisory Control and Data system, a/k/a "SCADA"
Customer Information System, a/k/a "CIS"
Marks:
The ▇▇▇▇▇▇▇▇ name and logo necessary for the following MLP name and logo:
[▇▇▇▇▇▇▇ ENERGY PARTNERS LOGO]