PURCHASE AND SALE AGREEMENT
FOR MEMBERSHIP INTEREST IN
SANDHILL GROUP, L.L.C.
BETWEEN
THE MAGNA CARTA GROUP, L.L.C.
AND
GENESIS CRUDE OIL, L.P.
Dated March 24, 2006
PART ONE
SUBJECT MATTER, DEFINITIONS AND RULES OF CONSTRUCTION 1
1.1 Subject Matter 1
1.2 Defined Terms 1
1.3 Other Definitions 5
1.4 Rules of Construction 5
PART TWO
PURCHASE AND SALE 6
2.1 Basic Transaction 6
2.2 Closing and Deliveries at the Closing 6
2.3 Purchase Price 6
2.4 Earn-Out Payments 6
2.5 Section 754 Election and Purchase Price Allocation 6
2.6 Sales and Transfer Taxes 7
2.7 Distribution to Pay Taxes 7
PART THREE
REPRESENTATIONS AND WARRANTIES 7
3.1 Seller's Representations and Warranties 7
3.2 Buyer 9
3.3 Disclaimers 10
PART FOUR
COVENANTS 11
4.1 Pre-Closing Covenant of Seller 11
4.2 Post-Closing Covenant of Buyer 11
4.3 Pre-Closing Covenants of Seller and Buyer 11
4.4 Post-Closing Covenants of Seller and Buyer 12
PART FIVE
CONDITIONS TO CLOSING 13
5.1 Seller's Closing Conditions 13
5.2 Buyer's Closing Conditions 14
PART SIX
INDEMNITY 15
6.1 Seller 15
6.2 Buyer 15
6.3 Method of Asserting Claims 16
6.4 Payment 16
6.5 Limitation of Claims 17
6.6 Disputed Claims 17
6.7 Exclusivity 17
PART SEVEN
MISCELLANEOUS 17
7.1 Successors and Assigns 17
7.2 Waivers and Amendments 17
7.3 Notices 17
7.4 Counterparts 18
7.5 Entire Agreement 18
7.6 Governing Law 18
7.7 Expenses 18
7.8 Assignability 18
7.9 Invalidity 18
7.10 No Admission 19
7.11 Dispute Resolution 19
7.12 Attorneys' Fees 19
7.13 Further Assurances 19
7.14 Termination 20
SCHEDULES AND EXHIBITS
Schedules
1.2 Parties' With Actual Knowledge
2.4 Allocation of Asset Values and Purchase Price
3.1(e) Required Consents
3.1(f) Litigation
3.1(g) Encumbrances
3.1 (h) Taxes
3.1(i) Environmental
4.4 Contracts to be Assigned or Modified
7.11 Dispute Resolution Procedures
Exhibits
A Form of Assignment and Assumption Agreement
B Form of Amended and Restated Operating Agreement
C Form of Earnout Agreement
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this "Agreement") is entered into
effective as of March 24, 2006 (the "Effective Date") by and between The Magna
Carta Group, L.L.C., a Louisiana limited liability company (hereinafter
"Seller") and Genesis Crude Oil, L.P., a Delaware limited partnership
(hereinafter "Buyer"). Seller and Buyer are sometimes individually referred to
herein as a "Party" and collectively as "Parties."
RECITALS
WHEREAS, Seller desires to sell, and Buyer desires to purchase for
cash, 50 Class A units of membership interest in Sandhill Group, L.L.C., a
Mississippi limited liability company ("Sandhill") owned by Seller, representing
50% of the aggregate outstanding membership interests of Sandhill, upon the
terms and conditions contained herein;
NOW, THEREFORE, in consideration of the mutual promises contained
herein and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, each intending to be legally bound,
hereby agree as follows:
PART ONE
SUBJECT MATTER, DEFINITIONS AND RULES OF CONSTRUCTION
1.1 Subject Matter. The subject matter of this Agreement is the sale by Seller
of the Ownership Interest to be Purchased, the purchase by Buyer from Seller of
the Ownership Interest to be Purchased in exchange for cash, and the terms and
conditions upon which all of the foregoing shall take place (the "Transaction").
1.2 Defined Terms. For purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, the terms defined in this
Section 1.2 have the meanings assigned to them and the capitalized terms defined
elsewhere in the Agreement by inclusion in quotation marks and parentheses have
the meanings so ascribed to them.
"Actual Knowledge" of a Party means the actual knowledge of such
Party's personnel set forth on Schedule 1.2 attached hereto.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling or controlled by, or under common control
with, such Person. For purposes of this definition, the term "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with") as applied to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management of such Person, whether through ownership of voting securities or
ownership interests, by contract or otherwise, and specifically with respect to
a corporation or partnership, means direct or indirect ownership of more than
fifty percent (50%) of the voting stock in such corporation or of the voting
interest in a partnership or limited liability company.
"Agreed Rate" means the lesser of (a) six percent (6%), or (b) the
maximum rate from time to time permitted by Applicable Laws.
"Agreement" means this Agreement, including the Exhibits and Schedules.
"Applicable Laws" means, as enacted and in effect on or prior to the
Closing, all laws, statutes, treaties, rules, codes, ordinances, regulations,
certificates, orders, interpretations, licenses and permits of any Governmental
Entity, including the common or civil law (and including without limitation
those pertaining to occupational health and safety, consumer product safety,
employee benefits, the environment, securities or zoning), and all judgments,
decrees, injunctions, writs, orders or like action of any court, arbitrator or
other Governmental Entity of competent jurisdiction.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended and in effect on or prior to the Closing.
"Closing" means the consummation of the transactions required by this
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor law, and regulations or rules issued under any of the foregoing.
"Confidentiality Agreement" means the Site Visit Agreement between
Genesis Energy, Inc. and Seller dated as of December 10, 2004 and the
Confidentiality Agreement between Seller and Genesis Energy, L.P., dated as of
October 20, 2004, in each case as it may be amended or extended from time to
time.
"Contract" means any written or oral contract, agreement, lease, plan,
instrument or other document, commitment, arrangement, undertaking, practice or
authorization that is or may be binding on any Person or its property under
Applicable Law.
"Corporate Documents" means with respect to a Delaware corporation, the
certificate of incorporation and by-laws, or the equivalent documents of a
corporation organized under the laws of another jurisdiction; or with respect to
a Delaware limited partnership or a Louisiana limited liability company, the
certificate of limited partnership /articles of organization and limited
partnership agreement/limited liability company operating agreement, or the
equivalent documents of a limited partnership or limited liability company
organized under the laws of another jurisdiction.
"Environmental Laws" means, in each case, as enacted and in effect on
or prior to the Closing, all Applicable Laws relating to pollution or protection
of the environment (including ambient air, surface water, groundwater, land
surface or subsurface strata), including the Clean Air Act, as amended, CERCLA,
RCRA, the Toxic Substances Control Act, as amended, the Federal Water Pollution
Control Act, as amended, the Safe Drinking Water Act, as amended, the Hazardous
Materials Transportation Act, as amended, the Oil Pollution Act of 1990, any
state laws implementing the foregoing federal laws, and all other Applicable
Laws relating to (i) pollutants prohibited by law, and (ii) the generation,
processing, distribution, use, treatment, handling, storage, disposal, or
transportation of Hazardous Substances. "Environmental Laws" shall also include
all Applicable Laws dealing with the same subject matter or promulgated by any
Governmental Authority thereunder to carry out the purposes of any such
Applicable Law, as enacted and in effect on or prior to the Closing.
"Facilities" means all property owned or leased by Sandhill regardless
of where located.
"Governmental Entity" means any federal, state, tribal, county, parish,
municipal, or other federal, state or local governmental authority or judicial
or regulatory agency, board, body, department, bureau, commission,
instrumentality, court, tribunal or quasi-governmental authority in any
jurisdiction (domestic or foreign) having jurisdiction over the Facility, the
Parties, or the transactions contemplated by this Agreement.
"Hazardous Substances" means any (a) hazardous substances as defined by
ss.101(14) of CERCLA and (b) any other contaminant, pollutant or waste
(including petroleum hydrocarbon contaminants, pollutants or wastes) that is
regulated by any Governmental Entity under any Environmental Law; provided,
however, "Hazardous Substances" does not include non-waste petroleum substances
or products including, without limitation, natural gas and natural gas liquids
that are recoverable on a commercially reasonable basis.
"IRS" means the Internal Revenue Service.
"Lien" means any mortgage, lien, security interest, pledge,
encumbrance, restriction on transferability, defect of title, charge, or other
security interest.
"Losses" means any and all losses, liabilities, claims, demands,
penalties, fines, settlements, damages, actions, or suits of whatsoever kind and
nature (but expressly excluding consequential damages suffered by a Party or its
Affiliates), whether or not subject to litigation, including without limitation
(i) claims or penalties arising from products liability, negligence, statutory
liability or violation of any Applicable Law or in tort (strict, absolute or
otherwise), (ii) loss of or damage to any property, and (iii) all reasonable
out-of-pocket costs, disbursements and expenses (including, without limitation,
reasonable legal, accounting, consulting and investigation expenses and
litigation costs).
"Material Agreement" means an agreement with a remaining contract term
of no less than one (1) year from the Effective Date and an annual consideration
of more than $50,000.
"Material Adverse Effect" means any effect or change that would be
materially adverse to the business of Sandhill, taken as a whole, or to the
ability of any Party to consummate timely the transactions contemplated hereby,
as applicable; provided that none of the following shall be deemed to
constitute, and none of the following shall be taken into account in determining
whether there has been, a Material Adverse Effect: (a) any adverse change,
event, development, or effect arising from or relating to (1) general business
or economic conditions, including such conditions related to the business of
Sandhill, (2) national or international political or social conditions,
including the engagement by the United States in hostilities, whether or not
pursuant to the declaration of a national emergency or war, or the occurrence of
any military or terrorist attack upon the United States, or any of its
territories, possessions, or diplomatic or consular offices or upon any military
installation, equipment or personnel of the United States, (3) financial,
banking, or securities markets (including any disruption thereof and any decline
in the price of any security or any market index), (4) changes in United States
generally accepted accounting principles, (5) changes in laws, rules,
regulations, orders, or other binding directives issued by any governmental
entity, or (6) the taking of any action contemplated by this Agreement and the
other agreements contemplated hereby, (b) any existing event, occurrence, or
circumstance with respect to which Buyer has knowledge as of the date hereof,
and (c) any adverse change in or effect on the business of Sandhill that is
cured by Seller before the earlier of (1) the Closing Date and (2) the date on
which this Agreement is terminated.
"Members" means the Persons who own a membership interest in Sandhill,
under and pursuant to the terms of the Operating Agreement.
"Operating Agreement" means the Limited Liability Company Operating
Agreement of Sandhill dated as of January 21, 2002 between Seller and other
members of Sandhill, including any and all amendments thereto.
"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity and
frequency).
"Ownership Interest to be Purchased" means 50 Class A units of
membership interest in Sandhill owned by Seller, representing 50% of the
aggregate outstanding membership interests of Sandhill.
"Permitted Encumbrances" means the existence or effect of:
(i) any applicable voting restrictions, preferential purchase rights
and other rights and obligations of Members set forth in the Operating
Agreement;
(ii) liens for Taxes or assessments not yet due or delinquent or, if
delinquent, that are being contested in good faith in the Ordinary Course of
Business;
(iii) all rights to consent by, required notices to, filings with, or
other actions by Governmental Entities in connection with the sale or conveyance
of the Ownership Interest to be Purchased, if the same are customarily obtained
subsequent to such sale or conveyance;
(iv) easements, road-use agreements, rights-of-way, servitudes,
permits, surface leases and other rights in respect of surface operations, or
defects or deficiencies in title thereto, that do not materially interfere with
the operation or use of the Facility;
(v) zoning and planning laws and regulations to the extent valid and
applicable to the Facility; and
(vi) liens of carriers, warehousemen, mechanics, workers, material
suppliers or other providers of materials or services arising by operation of
Applicable Laws in the Ordinary Course of Business or incident to the
construction or improvement of any property in respect of obligations which are
not yet due.
"Person" means any natural person, corporation, division of a
corporation, association, company, estate, trust, partnership, joint venture,
unincorporated organization, Governmental Entity, or any other entity.
"RCRA" means the Resource Conservation and Recovery Act of 1976, as
amended and in effect on or prior to the Closing.
"Release" shall have the meaning specified in CERCLA.
"Seller's Allocable Portion" means fifty percent (50%).
"Taxes" shall mean any and all fees (including, without limitation,
documentation, license, recording, filing and registration fees), taxes
(including without limitation, production, gross receipts, ad valorem, value
added, windfall profit tax, environmental tax, turnover, sales, use, personal
property (tangible and intangible), stamp, leasing, lease, user, leasing use,
excise, franchise, transfer, heating value, fuel, excess profits, occupational,
interest equalization, lifting, oil, gas, or mineral production or severance,
and other taxes), levies, imposts, duties, charges or withholdings of any nature
whatsoever, imposed by any Governmental Entity or taxing authority thereof,
domestic or foreign, together with any
and all penalties, fines, additions to
tax and interest thereon, which are existing or hereafter adopted on or prior to
the Closing.
"Termination Date" means April 30, 2006.
1.3 Other Definitions. The following terms shall have the respective
meanings ascribed to them in the Sections of the Agreement set forth below
opposite such terms:
Amended and Restated Operating Agreement......................2.2
Buyer.........................................................Preamble
Claim Notice..................................................6.3(a)
Claim Threshold...............................................6.5(b)
Closing Date..................................................2.2
Deposit.......................................................2.7
Disputed Claim................................................6.6
Distributable Cash............................................4.2(b)
Effective Date................................................Preamble
Indemnified Party.............................................6.3(a)
Indemnifying Party............................................6.3(a)
Notice Period.................................................6.3(a)
Party.........................................................Preamble
Purchase Price................................................2.3
Seller........................................................Preamble
Transaction...................................................1.1
1.4 Rules of Construction. For purposes of this Agreement:
(a) General. Unless the context otherwise requires, (i) "or" is not
exclusive; (ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with accounting principles that
are generally accepted in the United States of America; (iii) words in
the singular include the plural and words in the plural include the
singular; (iv) words in the masculine include the feminine and words in
the feminine include the masculine; (v) any date specified for any
action that is not a business day shall be deemed to mean the first
business day after such date unless otherwise specifically provided
herein; (vi) a reference to a Person includes its successors and
assigns; and (vii) the use of the word "include" or "including" when
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 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.
(b) Parts and Sections. References to Parts and Sections are, unless
otherwise specified, to Parts and Sections of this Agreement. Neither
the captions to Parts or Sections hereof nor the Table of Contents
shall be deemed to be a part of the Agreement.
(c) Exhibits and Schedules. The Exhibits and Schedules form part of
this Agreement and shall have the same force and effect as if set out
in the body of this Agreement.
(d) Other Agreements. References herein to any agreement or other
instrument shall, unless the context otherwise requires (or the
definition thereof otherwise specifies), be deemed
references to that
agreement or instrument as it may from time to time be changed, amended
or extended.
PART TWO
PURCHASE AND SALE
2.1 Basic Transaction. Subject to the terms and conditions of this Agreement, at
the Closing (i) Seller agrees to sell, transfer, assign and deliver to Buyer,
and Buyer agrees to purchase, receive and accept from Seller, the Ownership
Interest to be Purchased in exchange for the Purchase Price specified below, and
(ii) Seller shall assign to Buyer, and Buyer shall assume and agree to perform,
the rights and obligations of Seller under the Operating Agreement to the extent
attributable to the Ownership Interest to be Purchased.
2.2 Closing and Deliveries at the Closing. The Closing shall take place at the
offices of Seller, in Jackson, Mississippi commencing at 9:00 a.m. Central
Standard Time on or before the fifth business day following the satisfaction or
waiver of all conditions to the obligations of the Parties to consummate the
transactions contemplated hereby (other than conditions with respect to actions
the respective Parties will take at the Closing itself) or such other date as
Buyer and Seller may mutually determine, but not before April 3, 2006 (the
"Closing Date"). Subject to the terms and conditions of this Agreement, at the
Closing, (i) Buyer shall pay Seller the Purchase Price (defined in Section 2.3
below) in cash by wire transfer to an account designated by Seller or by
delivery of other immediately available funds, (ii) Seller and Buyer shall
execute and deliver two originals of an Assignment and Assumption Agreement,
substantially in the form of Exhibit A attached hereto, evidencing the transfer
to Buyer of the Ownership Interest to be Purchased, and the assignment to and
assumption by Buyer of the rights and obligations of Seller under the Operating
Agreement to the extent attributable to the Ownership Interest to be Purchased,
(iii) Seller and Buyer shall execute and deliver two originals of a First
Amended and Restated Operating Agreement of Sandhill, substantially in the form
of Exhibit B (the "Amended and Restated Operating Agreement"), evidencing the
new ownership of Sandhill and other terms of governance and operation of
Sandhill from and after the Closing, (iv) Seller and Buyer shall execute and
deliver two originals of an Earnout Agreement, substantially in the form of
Exhibit C (the "Earnout Agreement"), evidencing the terms and conditions of the
earnout payments referred to in paragraph 2.4 below, and (v) Seller and Buyer
shall deliver to each other the other respective certificates, instruments and
documents required to be delivered at, or as a condition to the Closing, under
this Agreement.
2.3 Purchase Price. The purchase price to be paid by Buyer shall be Five Million
Dollars ($5,000,000.00) in cash (the "Purchase Price").
2.4 Earn-Out Payments. Subject to the terms and conditions of this Agreement, in
consideration of the transfer of the Ownership Interest to be Purchased, Buyer
shall pay to Seller the earnout payments in accordance with the terms of the
Earnout Agreement.
2.5 Section 754 Election and Purchase Price Allocation. The Parties agree to
cause Sandhill to make an election under Section 754 of the Code on a timely
filed federal partnership return for the short period which ends on the Closing.
The Parties shall mutually agree on the relative values of the assets of
Sandhill, and allocate the Purchase Price among Sandhill's assets, in accordance
with the provisions of Sections 743, 754 and 755 of the Code, within 90 days
after the Closing. When agreed, the allocation of Purchase Price shall be
attached as Schedule 2.5 hereto. Any disagreements as to the allocation of
Purchase Price shall be resolved pursuant to the provisions of Section 7.11.
2.6 Sales and Transfer Taxes. The Purchase Price shall not include any sales or
transfer taxes imposed in connection with the sale of the Ownership Interest to
be Purchased. Any sales or transfer taxes imposed on the transaction will be the
responsibility of the Seller.
2.7 Distribution to Pay Taxes. On or promptly following the Closing, the Parties
agree to cause the Company to declare a distribution equal to Two Hundred
Thousand Dollars ($200,000) solely to Seller, so that Seller may have funds to
pay federal and state income taxes attributable to the Company's income for the
year ending December 31, 2005. Such distribution shall be payable by the Company
on or before April 15, 2006, and shall not affect the Membership Interest
percentages of the Parties following the Closing which shall remain at Fifty
Percent (50%) each notwithstanding such distribution.
PART THREE
REPRESENTATIONS AND WARRANTIES
3.1 Seller's Representations and Warranties. Except as set forth in the
schedules attached hereto and delivered by Seller to Buyer, Seller represents
and warrants to Buyer as of the Effective Date as follows; provided, however, no
such representation and warranty shall apply to the extent that Buyer or any of
its Affiliates as of the Effective Date has been provided with notice, or
otherwise holds Actual Knowledge, of a violation or inaccuracy thereof:
(a) Organization and Standing. Seller is a limited liability company, duly
organized and validly existing under the laws of the State of
Louisiana.
(b) Authority. Seller has the limited liability company power and authority
to execute, deliver and perform this Agreement. The execution, delivery
and performance of this Agreement have been duly authorized by all
requisite limited liability company action of Seller, and this
Agreement has been duly executed and delivered by Seller.
(c) Validity of Agreement. This Agreement constitutes a legal, valid and
binding obligation of Seller, enforceable against Seller in accordance
with its terms, except as may be limited by bankruptcy, insolvency,
reorganization or other similar Applicable Laws affecting the
enforcement of creditors' rights in general. The enforceability of the
Seller's obligations under this Agreement is subject to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(d) No Violation. Neither the execution or delivery, nor the performance by
Seller, of this Agreement contravenes or violates any provision of the
Corporate Documents of Seller or Sandhill, or contravenes or violates
any Applicable Laws to which Seller may be subject.
(e) No Consent Required. Except as set forth in Schedule 3.1(e) attached
hereto, no consent, approval, permit, authorization, filing or other
action is required on the part of Seller or Sandhill in connection with
the execution, delivery or performance of this Agreement either (i)
from or with any Person other than a Governmental Entity, except for
consents, approvals, authorizations or actions which, if not obtained,
made or taken, would not have a Material Adverse Effect on the Seller,
or (ii) from or with any Governmental Entity.
(f) Proceedings or Litigation. Except as set forth on Schedule 3.1(f)
attached hereto, to the Actual Knowledge of Seller, there are no
ongoing or threatened proceedings, claims or litigation against
Sandhill or against Seller relating to the execution, delivery or
performance of this Agreement and the Transaction.
(g) Title to Ownership Interest to be Purchased. Except as set forth on
Schedule 3.1(g) and except for the Permitted Encumbrances, Seller has
good title to, and legal and beneficial ownership of, the Ownership
Interest to be Purchased, free and clear of any and all proxies or
proxy agreements and voting trust arrangements, and free and clear of
any Liens created by or through Seller securing payment of monetary
obligations. Further, except as set forth on Schedule 3.1(g), Sandhill
has good title to, and legal and beneficial ownership of all material
assets reflected on its Financial Statements as of September 30, 2005,
subject to Liens securing payment of monetary obligations and the
Permitted Encumbrances.
(h) Taxes. Except as set forth on Schedule 3.1(h), to Seller's Actual
Knowledge (i) Seller has duly filed all federal, state, and local
governmental tax reports, returns, information statements, schedules or
certificates and all other reports and returns required to be filed by
it pursuant to any law or regulation of any governmental authority in
connection with the determination, assessment or collection of any
Taxes or the administration of any Applicable Laws relating to any
Taxes, and (ii) Seller has timely paid all Taxes shown to be due on
such reports or returns, if any.
(i) Environmental. To Seller's Actual Knowledge, and except as set forth on
Schedule 3.1(i), each of the following statements are true and correct:
(i) As of the Effective Date, neither the Facilities nor Sandhill are the
subject of any investigation, judicial, or administrative proceeding
concerning, a Release of any Hazardous Substance.
(ii) As of the Effective Date, neither the Facilities nor Sandhill are the
subject of any investigation, judicial, or administrative proceeding
concerning violations of any Environmental Laws in effect on the
Effective Date.
(iii) As of the Effective Date, neither the Facilities nor Sandhill are
subject to any material remedial, clean-up or monitoring obligations
under such Environmental Laws;
(iv) As of the Effective Date, Sandhill has in effect, or has applications
pending for, all material permits required by applicable Environmental
Laws for the operation and ownership of the Facility, and Sandhill is
not in violation of the terms and conditions of such permits in any
material respects;
(v) As of the Effective Date, Sandhill (a) is not subject to any consent
decree, compliance order or administrative order issued pursuant to
applicable Environmental Laws regarding the Facility, and (b) has not
received written notice under the citizen suit provision of any
Environmental Law or written request for information, notice of
violation, demand letter, administrative inquiry, complaint or claim
from any Governmental Entity pursuant to applicable Environmental Laws
regarding the Facility;
(vi) As of the Effective Date, no conditions or circumstances exist or have
existed from May 18, 2002 to the Effective Date, with respect to off
site disposal of any Hazardous Substances pertaining to the ownership,
operation or maintenance of any Facility which is regulated under
Environmental Law which would impose any liability on Seller, Buyer as
the assignee of Seller, or the Ownership Interest to be Purchased,
except where the condition or circumstance would not have a Material
Adverse Effect; and
(vii) As of the Effective Date, no conditions or circumstances exist or
have existed from May 18, 2002 to the Effective Date, and no
activities are occurring or have occurred from May 18, 2002 to the
Effective Date, on or in connection with the Facility that are
resulting or have resulted in the exposure of any Person to a
Hazardous Substance above regulatory thresholds such that Seller,
Buyer as the assignee of Seller or the Ownership Interest to be
Purchased are reasonably likely to incur liability to such Person for
personal injuries, damages or death resulting from such exposure,
except where the condition, circumstance or activity would not have a
Material Adverse Effect.
(j) Capital Accounts. To the Seller's Actual Knowledge, the audited
financial statements of Sandhill for the period ending December 31,
2004, properly reflect the capital accounts of Sandhill as of December
31, 2004, which capital accounts have been maintained in accordance
with the Operating Agreement, and there are no additional contributions
to Sandhill required from Seller.
(k) Agreements. Seller has provided, or caused Sandhill to provide, Buyer
with copies of all Material Agreements to which Sandhill is a party as
of the Effective Date, of which Seller has Actual Knowledge.
(l) Brokers. Neither Seller nor any of its Affiliates has any liability or
obligation to pay any fees or commissions to any broker, finder or
agent with respect to the transactions contemplated by this Agreement.
3.2 Buyer. Buyer represents and warrants to Seller as of the Effective
Date as follows:
(a) Organization and Standing. Buyer is a limited partnership duly
organized and validly existing under the laws of Delaware.
(b) Authority. Buyer has the power and authority to execute, deliver and
perform this Agreement. The execution, delivery and performance of this
Agreement have been duly authorized by all requisite action of Buyer
and this Agreement has been duly executed and delivered by Buyer.
(c) Validity of Agreement. This Agreement constitutes a legal, valid and
binding obligation of Buyer, enforceable against Buyer in accordance
with the terms, except as may be limited by bankruptcy, insolvency,
reorganization or other similar Applicable Laws affecting the
enforcement of creditors' rights generally. The enforceability of
Buyer's obligations under this Agreement is subject to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(d) No Violation. Neither the execution and delivery, nor the performance
by Buyer of its obligations under this Agreement contravenes or
violates any provision of the Corporate
Documents of Buyer, or
contravenes or violates any Applicable Laws to which Buyer may be
subject.
(e) No Consent Required. No consent, approval, permit, authorization or
other action by, or filing with, any Governmental Entity or other
Person that is required in connection with the execution, delivery and
performance by Buyer of this Agreement has not been obtained.
(f) No Bankruptcy. There are no bankruptcy, reorganization or receivership
proceedings pending, being contemplated by, or to the Actual Knowledge
of Buyer, threatened against Buyer.
(g) Knowledgeable Investor. Buyer is an experienced and knowledgeable
investor. In making its decision to participate in this Agreement and
the Transaction, Buyer has relied solely on its own independent
investigation, analysis and evaluation of the Ownership Interest to be
Purchased, the Facility and any business associated therewith.
(h) Securities Representation. Buyer is acquiring the Ownership Interest to
be Purchased for its own account and not with a view to, or for offer
of resale in connection with, a distribution thereof, within the
meaning of the Securities Act of 1933, 15 U.S.C. Section 77a et seq.,
or any other Applicable Laws pertaining to the distribution of
securities.
(i) Funding. Buyer has sufficient funds, or has arranged to have available
by the Closing Date, sufficient funds, to enable Buyer to pay in full
the Purchase Price as herein provided and otherwise to perform its
obligations under this Agreement.
(j) Brokers. Neither Buyer nor any of its Affiliates has any liability or
obligation to pay any fees or commissions to any broker, finder or
agent with respect to the transactions contemplated by this Agreement.
3.3 Disclaimers. Buyer acknowledges that (a) at the Closing it will acquire the
Ownership Interest to be Purchased on the basis of its own investigation of the
physical and financial condition of the Facility and Sandhill's business, and
assumes the risk that adverse conditions outside the scope of Seller's
representations and warranties set forth in Section 3.1 may not be revealed by
Buyer's own investigation, and (b) its admission as a member of Sandhill shall
be subject to the terms of the Operating Agreement and Applicable Laws. Buyer
acknowledges that EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, (i) NO
WARRANTY, EXPRESS OR IMPLIED IN FACT OR BY LAW, WHETHER OF MERCHANTABILITY,
FITNESS FOR ANY PARTICULAR PURPOSE, CONDITION OR OTHERWISE HAS BEEN MADE TO
BUYER WITH RESPECT TO THE OWNERSHIP INTEREST TO BE PURCHASED, SANDHILL, THE
FACILITY OR ANY BUSINESS ASSOCIATED THEREWITH, (ii) THE OWNERSHIP INTEREST TO BE
PURCHASED IS SOLD ON AN "AS IS, WHERE IS" BASIS, AND (iii) BUYER'S REMEDIES
AGAINST SELLER, AND SELLER'S LIABILITIES TO BUYER, WITH RESPECT TO THE OWNERSHIP
INTEREST TO BE PURCHASED, SANDHILL OR THE FACILITY ARE LIMITED TO THOSE PROVIDED
IN THIS AGREEMENT.
PART FOUR
COVENANTS
4.1 Pre-Closing Covenant of Seller. From the Effective Date until the Closing
Date and subject to the terms of any confidentiality obligations under the
Operating Agreement, Seller shall permit Buyer and its representatives at
reasonable times, during normal business hours in a manner so as not to
interfere with the normal business operations of Sandhill and its Affiliates, to
examine, in Seller's or its Affiliates' offices at their actual location, all
Contracts and other information related to Sandhill, in Seller's operational
files, insofar as the same may now be in existence and in the possession of
Seller, but excluding all legal files, attorney-client communications or
attorney work product, and records and documents subject to confidentiality
provisions, claims of privilege or other restrictions on access (including,
without limitation, contractual obligations to third Persons). Buyer shall
treat, and hold as such, any information it has received from Seller prior to
the Effective Date, or shall receive from Seller prior to the Closing in the
course of the reviews contemplated by this Section 4.1, as confidential
information, and will not use any of such information except in connection with
this Agreement, and if the Agreement is terminated for any reason whatsoever,
will promptly return to Seller all tangible embodiments (and all copies) of such
information that are in its possession.
4.2 Post-Closing Covenant of Buyer. Following the Closing, Buyer shall cooperate
fully with Seller in connection with the preparation and filing of any Tax
return, and the defense of any claim, audit, litigation or other proceeding,
with respect to the Taxes of Seller relating to the Ownership Interest to be
Purchased for any period ending on or prior to the Closing Date.
4.3 Pre-Closing Covenants of Seller and Buyer. Seller and Buyer agree as follows
with respect to the period from the Effective Date to the Closing:
(a) Satisfaction of Conditions Precedent. Seller and Buyer shall each make
commercially reasonable efforts to cause the conditions precedent set
forth in Part Five applicable to such Party to be fulfilled and
satisfied as soon as practicable.
(b) Certain Filings and Consents. With respect to the consents set forth on
Schedule 3.1(e), the Parties agree that Seller shall, or shall cause
Sandhill to, promptly give any notices to third parties and make
commercially reasonable efforts to obtain, and Buyer shall reasonably
cooperate in connection with such endeavors, each consent set forth on
Schedule 3.1(e). With respect to the consent and review rights of
Governmental Entities, Seller and Buyer shall each in a timely manner
(i) make all required filings, if any, and prepare applications to and
conduct negotiations, with each Governmental Entity as to which
such filings, applications or negotiations are necessary or
appropriate for the consummation of the transactions contemplated
hereby and (ii) provide such information as the other Party or the
Governmental Entity may reasonably request in order to make such
filings, prepare such applications and conduct such negotiations.
Each Party shall cooperate with and use all commercially reasonable
efforts to assist the other Party with respect to such filings,
applications and negotiations.
(c) Press Release. Until the Closing, neither Party nor any of its
Affiliates shall make any press release or other public announcement
regarding the existence of this Agreement, the contents hereof or the
transactions contemplated hereby without the prior written consent
of the other Party (which consent shall not be unreasonably withheld);
provided, however, the foregoing shall not restrict disclosures by
Buyer or Seller or their respective Affiliates (i) that are required
by Applicable
Law, court order or the applicable rules of any stock
exchange having jurisdiction over the disclosing Party or its
Affiliates (in which case the disclosing Party will use its reasonable
best efforts to advise the other Party prior to making the disclosure),
or (ii) to Governmental Entities and to third Persons holding
preferential rights to purchase, rights of consent or similar rights
that may be applicable to the transactions contemplated by this
Agreement, as reasonably necessary to obtain waivers of such rights or
to obtain such consents.
(d) Consent and Preferential Purchase Rights. Seller and Buyer shall use
their commercially reasonable efforts to take all actions that may be
reasonably necessary to comply with any applicable consent
requirements, preferential purchase rights, or other conditions
precedent to the transfer of the Ownership Interest to be Purchased,
which are set forth in the Operating Agreement.
(e) Notice of Developments. Seller may elect at any time to notify Buyer of
any development causing a breach of any of the representations and
warranties in Section 3.1 above. Such written notice pursuant will be
deemed to have amended the disclosure schedules attached hereto, to
have qualified the representations and warranties contained in Section
3.1 above, and to have cured any misrepresentation or breach of
warranty that otherwise might have existed hereunder by reason of the
development.
4.4 Post-Closing Covenants of Seller and Buyer.
For a period of three (3) years after the Closing Date, either Party
holding such records on the Closing Date shall (i) preserve and retain the
corporate accounting, legal, auditing, Tax, environmental, operating,
maintenance and inspection and other books and records that relate to the
conduct of the business of Sandhill prior to the Closing Date and (ii) other
than books, records and documents (x) subject to the attorney/client privilege,
(y) constituting attorney work product or (z) relating to proprietary forecasts
of financial or operating data, make such books and records available (at a
place reasonably agreed to by Buyer and Seller) to the other Party upon
reasonable notice and at reasonable times, it being understood that the other
Party shall be entitled to make and retain copies of any such books and records
as it shall deem necessary at the other Party's expense. In the event the other
Party desires to extend the period referred to in the first sentence of this
Section 4.4 beyond three (3) years, it may do so if the applicable statute of
limitations for the years with respect to which the books and records relate has
not expired, and such extension is requested in a writing stating that the
statute of limitations has not yet expired. In the event and for so long as any
Party actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand in connection with
(i) any transaction contemplated under this Agreement or (ii) any fact,
situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction on or prior
to the Closing Date involving Sandhill or any of its Affiliates, the other Party
shall cooperate with it and its counsel in the defense or contest, make
available its personnel, and provide such testimony and access to his, her, or
its books and records as shall be necessary in connection with the defense or
contest, all at the sole cost and expense of the contesting or defending Party
(unless the contesting or defending Party is entitled to indemnification
therefor herein). The Parties shall also use their reasonable best efforts to
cause the contracts referenced on Schedule 4.4 to be assigned to Sandhill, or to
be modified so as to reference Sandhill as the party in interest rather than The
Magna Carta Group, L.L.C., within a period of sixty (60) days following the
Closing Date.
PART FIVE
CONDITIONS TO CLOSING
5.1 Seller's Closing Conditions. The obligations of Seller to consummate the
Closing under this Agreement are subject to the following conditions; provided,
however, Seller may waive any condition specified in this Section 5.1 if it
executes a writing so stating at or prior to the Closing:
(a) Representations and Warranties True at Closing. The representations and
warranties of Buyer contained in this Agreement or in any certificate
or document delivered pursuant to the provisions hereof or in
connection with the Transaction, shall be true and correct when made,
and shall be true and correct in all material respects on and as of the
Closing Date as though such representations and warranties were made at
and as of such date except as otherwise expressly provided herein.
(b) Compliance with Agreement. On and as of the Closing Date, Buyer shall
have performed and complied in all material respects with all
agreements, covenants, and conditions required by this Agreement, to be
performed and complied with by Buyer or its Affiliates prior to or on
the Closing Date.
(c) No Injunction. As of the Closing Date, no suit, action or other
proceeding shall be pending or threatened before any court or
Governmental Entity of competent jurisdiction seeking to enjoin or
prevent Seller or its Affiliates from completing the Closing or seeking
damages against Seller or its Affiliates as a result of the Closing of
this Agreement or consummation of the transactions contemplated
thereby.
(d) Certified Resolutions and Officers' Certificate. Buyer shall have
delivered to Seller (i) a certificate dated as of the Closing Date
signed by the Secretary or an Assistant Secretary of Buyer with respect
to the action of Buyer's Board of Directors or its designee authorizing
the Transaction, and (ii) a certificate dated as of the Closing Date
and signed by the President or a Vice President of Buyer certifying, in
such detail as Seller may reasonably request, the fulfillment of the
conditions specified in subparagraphs (a) and (b) of this Section 5.1.
(e) Incumbency Certificates. Seller shall have received a certificate of
Buyer dated the Closing Date certifying the incumbency of the officers
of Buyer signing for it and the authenticity of their signatures.
(f) Approvals, Consents, Guarantees, Tender to Minority Members, and
Amendments to Operating Agreement. Seller shall be reasonably
satisfied that all approvals and consents necessary for the
consummation of the transactions contemplated by this Agreement have
been obtained, including without limitation waivers of any applicable
preferential purchase rights set forth in the Operating Agreement. In
addition, on or prior to the Closing, any guarantees of the
indebtedness or other financial obligations of Sandhill which were
executed by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇, or Seller shall have been either (i) terminated, or
(ii) restructured, so that Buyer and Seller guarantee such indebtedness
or other financial obligations of Sandhill on a 50/50 basis. In
addition, the members of Sandhill, other than Seller, shall have
agreed to sell, and tendered, their units of membership interest
in Sandhill to Seller on terms satisfactory to Seller, effective
immediately following the Closing and contingent on the consummation
of the Transaction, such that following the Closing, Buyer and Seller
shall be the only members of Sandhill
having a right to vote on
matters submitted to a vote of the members of Sandhill. Finally,
Buyer shall have executed the Amended and Restated Operating Agreement.
(g) Receipt of Purchase Price and Other Deliveries. Seller shall have
received notification from the financial institution utilized by Buyer
to consummate the Transaction that the Purchase Price has been
deposited to Seller's account, and all actions to be taken by Buyer in
connection with consummation of the transactions contemplated hereby
and all certificates, instruments, and other documents required to
effect the transactions contemplated hereby will be reasonably
satisfactory in form and substance to Sellers.
5.2 Buyer's Closing Conditions. The obligations of Buyer to consummate the
Closing under this Agreement are subject to the following conditions; provided,
however, Buyer may waive any condition specified in this Section 5.2 if it
executes a writing so stating at or prior to the Closing:
(a) Representations and Warranties True at Closing. The representations and
warranties of Seller contained in this Agreement or in any certificate
or document delivered pursuant to the provisions hereof in connection
with the Transaction shall be true and correct when made, and shall be
true and correct in all material respects on and as of the Closing Date
as though such representations and warranties were made at and as of
such date except as otherwise expressly provided herein.
(b) Compliance with Agreement. On and as of the Closing Date, Seller shall
have performed and complied in all material respects with all
agreements, covenants, and conditions required by the Agreement to be
performed or complied with by Seller or its Affiliates prior to or on
the Closing Date.
(c) No Injunction. As of the Closing Date, no suit, action or other
proceeding shall be pending or threatened before any court or
Governmental Entity of competent jurisdiction seeking to enjoin or
prohibit Buyer or its Affiliates from completing the Closing or seeking
damages against Buyer or its Affiliates as a result of the Closing of
this Agreement or consummation of the transactions contemplated
thereby.
(d) Certified Resolutions and Officers' Certificate. Seller shall have
delivered to Buyer (i) a certificate dated the Closing Date signed by
the Secretary or an Assistant Secretary of Seller with respect to the
action of the Seller's manager or managing member authorizing the
transactions contemplated by the Agreement, and (ii) a certificate
dated the Closing Date and signed by the President or a Vice President
of Seller certifying in such detail as Buyer may reasonably request the
fulfillment of the conditions specified in subparagraphs (a) and (b) of
this Section 5.2.
(e) Incumbency Certificates. Buyer shall have received a certificate of
Seller dated the Closing Date certifying the incumbency of the officers
of Seller signing for it and the authenticity of their signatures.
(f) Approvals and Consents. Buyer shall be reasonably satisfied that all
approvals and consents necessary for the consummation of the
transaction contemplated by this Agreement (other than approvals and
consents required from Buyer or its Affiliates) shall have been
obtained, including without limitation waivers of any applicable
preferential purchase rights set forth in the Operating Agreement.
(g) Amendments to the Operating Agreement and Other Deliveries. Seller
shall have executed the Amended and Restated Operating Agreement, and
all actions to be taken by Seller in connection with consummation of
the transactions contemplated hereby and all certificates, instruments,
and other documents required to effect the transactions contemplated
hereby will be reasonably satisfactory in form and substance to Buyer.
PART SIX
INDEMNITY
6.1 Seller.
(a) All of the representations and warranties of the Seller contained in
Section 3.1 above shall survive the Closing hereunder (unless Buyer
knew or had reason to know of any misrepresentation or breach of
warranty at the time of Closing) and continue in full force and effect
for a period of two (2) years thereafter.
(b) In the event Seller breaches any of its representations, warranties,
and covenants contained herein and, provided that Buyer makes a written
claim for indemnification against the Seller, disclosing in reasonable
detail the basis therefore, within the survival period, Seller shall
indemnify, defend and hold harmless Buyer, its Affiliates and their
directors, employees and agents from and against all Losses (but
excluding any Losses suffered after the end of any applicable survival
period or resulting from acts or omissions of Buyer) caused proximately
by the breach.
(c) Seller shall also indemnify, defend and hold harmless Buyer, its
Affiliates and their directors, employees and agents from and against
Seller's Allocable Portion of all Losses caused proximately by any
third party claims asserted in writing against Buyer within two (2)
year following the Closing Date which arise out of any liability of
Sandhill (other than with respect to any guaranty of indebtedness of
Sandhill which Buyer assumes or enters into upon consummation of the
Transaction) incurred prior to the Closing Date, but excluding from the
foregoing any Losses either resulting from conditions or issues of
which Buyer was aware prior to the Closing Date or resulting from acts
or omissions of Buyer.
(d) Notwithstanding anything to the contrary herein, in the case of
indemnification otherwise required from Seller under Section 6.1(b)
or (c), Seller shall have no obligation to indemnify Buyer (A) until
Buyer has suffered Losses by reason of all such breaches and third
party claims in excess of a $150,000 aggregate deductible (after
which point Seller will be obligated only to indemnify Buyer from and
against further such Losses) or thereafter (B) to the extent the Losses
Buyer has suffered by reason of all such breaches and third party
claims exceed a Two Million Two Hundred Thousand Dollar ($2,200,000)
aggregate ceiling (after which point Seller will have no obligation to
indemnify Buyer from and against further such Losses).
6.2 Buyer. All of the representations and warranties of the Buyer contained in
Section 3.2 above shall survive the Closing hereunder (unless Seller knew or had
reason to know of any misrepresentation or breach of warranty at the time of
Closing) and continue in full force and effect for a period of two (2) years
thereafter. In the event Buyer breaches any of its representations, warranties,
and covenants contained herein, and provided that Seller makes a written claim
for indemnification against Buyer, disclosing in reasonable detail the basis
therefore, within the survival period, then Buyer shall indemnify, defend and
hold harmless Seller, its Affiliates and their directors, employees and agents
from and
against all Losses (but excluding any Losses suffered after the end of
any applicable survival period or resulting from acts or omissions of Seller)
caused proximately by the breach.
6.3 Method of Asserting Claims. All claims for indemnification under the
Agreement shall be asserted and resolved as follows, provided that the
provisions of Sections 6.3 through 6.6 shall be covenants and not conditions to
the defense and indemnity obligations to which they apply:
(a) Third Person Claims. In the event that any claim for which a
Party providing indemnification (the "Indemnifying Party") would be
liable to a Party or any of its officers, directors, employees,
agents or representatives entitled to indemnification hereunder (the
"Indemnified Party") is asserted against or sought to be collected by
a third Person, the Indemnified Party shall promptly notify the
Indemnifying Party of such claim, specifying the nature of such claim
and the amount or the estimated amount thereof to the extent then
feasible (which estimate shall not be conclusive of the final amount of
such claim)(the "Claim Notice"); provided, however, that no delay on
the part of the Indemnified Party in notifying the Indemnifying Party
shall relieve the Indemnifying Party from any obligation hereunder
unless (and then solely to the extent) the Indemnifying Party is
thereby prejudiced. The Indemnifying Party shall have thirty (30)
days from its receipt of the Claim Notice (the "Notice Period") to
notify the Indemnified Party (i) whether or not it disputes its
liability to the Indemnified Party hereunder with respect to such
claim; and (ii) whether or not it desires, at its sole cost and
expense, to defend the Indemnified Party against such claim; provided,
however, that the Indemnified Party is hereby authorized prior to and
during the Notice Period to file any motion, answer or other
pleading, submission or document which it shall deem reasonably
necessary or appropriate to protect its interests. In the event
that the Indemnifying Party notifies the Indemnified Party within the
Notice Period that it desires to defend against such claim or demand,
then, except as hereinafter provided, the Indemnifying Party shall
have the right to defend such claim or demand by appropriate
proceedings, which proceedings shall be promptly settled or
prosecuted to a final conclusion, in such a manner as to avoid
any risk of the Indemnified Party becoming subject to liability. If
the Indemnified Party desires to participate in, but not control, any
such defense or settlement, it may do so at its own cost and
expense. If the Indemnifying Party does not elect to defend against
such claim, whether by not giving timely notice as provided above or
otherwise, the Indemnified Party shall have the right but not the
obligation to defend against such claim, and the amount of any such
claim, or if the same be contested by the Indemnifying Party or by
the Indemnified Party, then that portion thereof as to which such
defense is unsuccessful, shall be conclusively deemed to be a
liability of the Indemnifying Party hereunder (subject, if it has
timely disputed liability, to a determination that the disputed
liability is covered by this Part Six).
(b) Other Claims. In the event that the Indemnified Party shall have a
claim against the Indemnifying Party hereunder which does not involve a
claim or demand being asserted or sought to be collected from it by a
third Person, the Indemnified Party shall promptly send a Claim Notice
with respect to such claim to the Indemnifying Party. If the
Indemnifying Party does not notify the Indemnified Party within the
Notice Period that it disputes such claim, the amount of such claim
shall be conclusively deemed a liability of the Indemnifying Party
hereunder.
6.4 Payment. Payments under this Part Six and under any other indemnity
provision of this Agreement shall be made as follows:
(a) Payment of Undisputed Amount. In the event that the Indemnifying
Party is required to make any payment under this Part Six, the
Indemnifying Party shall promptly pay the Indemnified Party the
amount so determined. If there should be dispute as to the amount or
manner of determination of any indemnity obligation owed under this
Part Six, the Indemnifying Party shall
nevertheless pay when due
such portion, if any, of the obligation as shall not be subject to
dispute. The difference, if any, between the amount of the obligation
ultimately determined as properly payable under this Part Six and the
portion, if any theretofore paid, shall bear interest at the Agreed
Rate. Upon the payment in full of any claim, the Indemnifying Party
shall be subrogated to the rights of the Indemnified Party against any
Person or other entity with respect to the subject matter of this
claim.
(b) Payment of Interest. If all or part of any indemnification obligation
under the Agreement is not paid when due upon resolution of the claim,
then the Indemnifying Party shall pay upon demand to the Indemnified
Party interest at the Agreed Rate on the unpaid amount of the
obligation for each day from the date the amount became due until
payment in full.
6.5 Limitation of Claims. No claim shall be made or be effective unless the
Indemnified Party shall have delivered to the Indemnifying Party a Claim Notice
within two (2) years after the Closing Date, if the claim is based on
misrepresentation or a breach of the representations or warranties in Part
Three.
6.6 Disputed Claims. If the Indemnifying Party shall notify the Indemnified
Party during the Notice Period that it disputes any claim under Section 6.3 (the
"Disputed Claim"), the Disputed Claim shall be subject to the dispute resolution
procedures provided in Section 7.11.
6.7 Exclusivity. After the Closing, Sections 6.1 and 6.2 shall provide the
exclusive remedy for any misrepresentation, breach of warranty, covenant,
agreement or other obligation contained in this Agreement. EXCEPT AS
SPECIFICALLY PROVIDED OTHERWISE, THE INDEMNIFICATION PROVISIONS IN THIS PART SIX
SHALL BE ENFORCEABLE REGARDLESS OF WHETHER LIABILITY IS BASED UPON PAST, PRESENT
OR FUTURE ACTS, CLAIMS OR LEGAL REQUIREMENTS (INCLUDING ANY PAST, PRESENT OR
FUTURE BULK SALES LAW, ENVIRONMENTAL LAW, FRAUDULENT TRANSFER ACT, OCCUPATIONAL
SAFETY AND HEALTH LAW OR PRODUCTS LIABILITY, SECURITIES OR OTHER LEGAL
REQUIREMENT).
PART SEVEN
MISCELLANEOUS
7.1 Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of the respective Parties.
7.2 Waivers and Amendments. All amendments and other modifications hereof shall
be in writing and signed by each of the Parties. Any Party may by written
instrument (a) waive compliance by the other Party with, or modify any of, the
covenants or agreements made by the other Party in this Agreement or (b) waive
or modify performance of any of the obligations or other acts of the other
Party. The delay or failure on the part of any Party to insist, in any one
instance or more, upon strict performance of any of the terms or conditions of
this Agreement, or to exercise any right or privilege herein conferred shall not
be construed as a waiver of any such terms, conditions, rights or privileges but
the same shall continue and remain in full force and effect. All rights and
remedies are cumulative.
7.3 Notices. All notices and consents required under this Agreement shall be in
writing and shall be deemed to have been duly given (a) when delivered by hand,
(b) when sent by facsimile (with receipt confirmed), provided that a copy is
promptly thereafter mailed in the United States of America by first class
postage prepaid mail, (c) when received by the addressee, if sent by Express
Mail, Federal Express, other
express delivery service (receipt requested) or by
such other means as the Parties may agree from time to time or (d) five (5)
Business Days after being mailed in the United States of America, by first class
postage prepaid registered or certified mail, return receipt requested; in each
case to the appropriate address and facsimile number set forth below (or to such
other address and facsimile number as a Party may designate as to itself by
notice to the other Party):
(i) if to Seller: The Magna Carta Group, L.L.C.
......... ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
......... ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Managing Member
......... Phone: (▇▇▇) ▇▇▇-▇▇▇▇
......... Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to Buyer: Genesis Crude Oil, L.P.
......... ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
......... ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
......... Phone: (▇▇▇) ▇▇▇-▇▇▇▇
......... Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Each Party shall have the right upon giving ten (10) Business Days
prior written notice to the other in the manner hereinabove provided, to change
its address for purposes of notice.
7.4 Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be an original, but all of which together shall constitute
one and the same document.
7.5 Entire Agreement. This Agreement, including the Exhibits and Schedules
hereto, contains the entire agreement between the Parties hereto with respect to
the subject matter hereof and supersedes all prior discussions, understandings,
agreements and undertakings between the Parties hereto relating to the subject
matter hereof; provided, however, that the Confidentiality Agreement shall
remain in full force and effect until and unless the Closing occurs, at which
time the Confidentiality Agreements shall terminate in accordance with the
respective termination provisions set forth therein. There are no additional
terms, whether consistent or inconsistent, oral or written which are intended to
be part of the Parties' understanding which have not been incorporated into this
Agreement, including the Exhibits and Schedules.
7.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Mississippi as applied to contracts
made and performed entirely within the State of Mississippi, without regard to
the conflict of laws principles thereof.
7.7 Expenses. Except as specified herein and as the Parties may otherwise agree,
each Party shall be solely responsible for all expenses incurred by it in
connection with this Agreement and the transactions contemplated hereby.
7.8 Assignability. The rights and obligations created or assumed hereunder shall
not be assignable or delegable by either Party and any assignment of this
Agreement shall be void ab initio.
7.9 Invalidity. If any of the terms, provisions, covenants or restrictions of
this Agreement, including the Schedule hereto, is held by a court of competent
jurisdiction to be invalid, void or
unenforceable and unless the invalidity,
voidability or unenforceability thereof does substantial violence to the
underlying intent and sense of the remainder of this Agreement, such invalidity,
voidability or unenforceability shall not affect in any way the validity or
enforceability of any other provision of this Agreement except those which the
invalidated, voided or unenforceable provision comprises an integral part of or
is otherwise clearly inseparable from. In the event any term, provision,
covenant or restriction is held invalid, void or unenforceable, the Parties
shall attempt to agree on a valid or enforceable provision which shall be a
reasonable substitute for such invalid or unenforceable provision in light of
the tenor of this Agreement and, on so agreeing, shall incorporate such
substitute provision in this Agreement.
7.10 No Admission. Nothing in this Agreement shall constitute any admission,
expressed or implicit, by the Parties of any wrongdoing. Nothing herein,
expressed or implied, is intended to confer upon any Person other than the
Parties any rights or remedies hereunder.
7.11 Dispute Resolution. Seller and Buyer covenant with each other as
follows:
(a) Generally. Any claim, controversy or dispute arising out of, relating
to, or in connection with the Agreement or the agreements and
transactions contemplated hereby, by Buyer, Buyer's Affiliates, Seller
or Seller's Affiliates, including the interpretation, validity,
termination or breach thereof, shall be resolved solely in accordance
with the dispute resolution procedures set forth in Schedule 7.11. The
Parties covenant that they shall not resort to court remedies except as
provided for in Schedule 7.11, or for preliminary relief in aid of
arbitration.
(b) Violations. A Party who violates the covenants in Section 7.11(a) shall
pay all the legal costs incurred by the other Parties in connection
with the enforcement thereof. Suits, actions or proceedings in
connection with violations of the covenants in Section 7.11(a) and
Schedule 7.11 shall be instituted in the United States District Court
for the Southern District of Mississippi, and pursuant to Title 9 of
the United States Code. Each Party waives any option or objection which
it may now or thereafter have to the laying of the venue in any such
suit, action or proceeding and irrevocably submits to the jurisdiction
of such court in any such suit, action or proceeding.
(c) Governmental Entity Approvals. Unless otherwise consented to by the
Governmental Entity, as applicable, the Parties acknowledge that their
respective rights and obligations under this Agreement are and will
remain following the Closing Date subject to all conditions and
restrictions contained in any approval of any Governmental Entity
relating to this Agreement and that no resolution of any dispute
between the Parties relating to this Agreement, whether pursuant to the
voluntary agreement of the Parties or pursuant to the procedure
specified in Schedule 7.11, shall be inconsistent with such conditions
or restrictions.
7.12 Attorneys' Fees. In any arbitration, action or proceeding brought to
enforce any provision of this Agreement, or where any provision hereof is
validly asserted as a defense, the successful Party shall be entitled to recover
reasonable attorneys' fees in addition to its cost and expense and any other
available remedy.
7.13 Further Assurances. Seller and Buyer shall provide to each other such
information regarding the Ownership Interest to be Purchased as may be
reasonably requested and shall execute and deliver to each other such further
documents and take such further action as may be reasonably requested by either
party to document, complete or give full effect to the terms and provisions of
this Agreement and the transactions contemplated herein.
7.14 Termination. The Agreement may be terminated at any time prior to the
Closing (i) by mutual written consent of the Parties; (ii) by Seller or Buyer if
the other Party shall have committed a material breach of this Agreement and
such breach shall not have been cured within ten (10) business days following
notice of default given by the non-breaching Party; or (iii) by either Seller or
Buyer if the Closing shall not have occurred on or before the Termination Date,
other than through the default of the terminating Party. Termination under
clause (i) above shall be effective as of the date of the Parties' mutual
consent; termination under any of clauses (ii) or (iii) above shall be effective
as of the date that the terminating Party delivers written notice of the event
of termination. Upon any termination the Parties shall have no further
obligations under this Agreement; provided, however, Buyer shall hold all
information which was obtained relating to the Transaction, subject to the
Confidentiality Agreement, and provided further that the provisions of Sections
7.3, 7.6, 7.7, 7.11 and 7.12 hereof shall remain in full force and effect.
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed by its authorized representatives as of the Effective Date.
SELLER:
THE MAGNA CARTA GROUP, L.L.C.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
NAME: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
TITLE: Managing Member/Manager
Tax ID: ▇▇-▇▇▇▇▇▇▇
BUYER:
GENESIS CRUDE OIL, L.P.
BY: GENESIS ENERGY, INC., its General
Partner
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
NAME: ▇▇▇▇ ▇. ▇▇▇▇▇▇
TITLE: President
Tax ID: ▇▇-▇▇▇▇▇▇▇