AMENDMENT NO. 1 TO AMENDED AND RESTATED OPERATING AGREEMENT OF ATLAS ENERGY RESOURCES, LLC DATED JUNE 29, 2007
Exhibit
10.29
AMENDMENT
NO. 1 TO AMENDED AND RESTATED
OPERATING
AGREEMENT OF ATLAS ENERGY
RESOURCES,
LLC DATED JUNE 29, 2007
CLASS
D AMENDMENT
AMENDMENT
NO. 1 TO AMENDED AND RESTATED
ATLAS
ENERGY RESOURCES, LLC
THIS
AMENDMENT NO. 1 TO AMENDED AND RESTATED OPERATING AGREEMENT OF ATLAS ENERGY
RESOURCES, LLC (this “Amendment”),
dated
as of June 29, 2007, is entered into and effectuated by the Board of Directors
(the “Board”)
of
Atlas Energy Resources, LLC, a Delaware limited liability company (the
“Company”),
pursuant to authority granted to it in Sections 5.5 and 11.1 of the Amended
and
Restated Operating Agreement of the Company, dated as of December 18, 2006
(the
“Limited
Liability Company Agreement”).
Capitalized terms used but not defined herein are used as defined in the Limited
Liability Company Agreement.
WHEREAS,
Section 5.5(a) of the Limited Liability Company Agreement provides that the
Company may issue additional Company Securities for any Company purpose at
any
time and from time to time for such consideration and on such terms and
conditions as the Board shall determine, all without the approval of any Members
(subject to the provisions of Section 5.6 of the Limited Liability Company
Agreement);
WHEREAS,
Section 5.5(b) of the Limited Liability Company Agreement provides that the
Company Securities authorized to be issued by the Company pursuant to Section
5.5(a) of the Limited Liability Company Agreement may be issued in one or more
classes, or one or more series of any such classes, with such designations,
preferences, rights, powers and duties (which may be senior to existing classes
and series of Company Securities) as shall be fixed by the Board;
WHEREAS,
Section 11.1(c)(vii) of the Limited Liability Company Agreement provides that
the Board, without the approval of any Member (subject to the provisions of
Section 5.6 of the Limited Liability Company Agreement), may amend any provision
of the Limited Liability Company Agreement that the Board determines to be
necessary or appropriate in connection with the authorization of issuance of
any
class or series of Company Securities pursuant to Section 5.5 of the Limited
Liability Company Agreement, and the Board has determined that the amendments
contemplated hereby are necessary or appropriate in connection
therewith;
WHEREAS,
the Board has determined that the issuance of the Class D Units provided for
in
this Amendment is permitted by Section 5.6 of the Limited Liability Company
Agreement;
WHEREAS,
Section 11.1(c)(iv) of the Limited Liability Company Agreement provides that
the
Board, without the approval of any Member, may amend any provision of the
Limited Liability Company Agreement to reflect a change that the Board
determines does not adversely affect the Members (including any particular
class
of Interests as compared to other classes of Interests) in any material respect,
and the Board has determined that such amendments contemplated hereby do not
adversely affect the Members in any material respect; and
WHEREAS,
the Board deems it in the best interest of the Company to effect this Amendment
to provide for (i) the issuance of the Class D Units, (ii) the conversion of
the
Class D Units into Common Units in accordance with the terms described herein
and (iii) such other matters as are provided herein.
NOW,
THEREFORE, it is hereby agreed as follows:
A. Amendment.
The Limited Liability Company Agreement is hereby amended as
follows:
1. Section
1.1 of the Limited Liability Company Agreement is hereby amended to add or
amend
and restate the following definitions in the appropriate alphabetical
order:
“Capital
Account True-Up Election”
has
the
meaning assigned to such term in Section 6.1(d)(xii)(C).
“Class
D Distribution Increase Date”
has
the
meaning assigned to such term in Section 5.11(h).
“Class
D Member Interests”
means
the Member Interests represented by the Class D Units.
“Class
D Unit Arrearage”
means,
with respect to any Class D Unit, whenever issued, as to any Quarter, the
amount, if any, by which (a) the Initial Quarterly Distribution in respect
of
such Quarter (or, for the period from the Class D Distribution Increase Date
through the Conversion Approval, 115% of the Initial Quarterly Distribution)
exceeds (b) the sum of all Available Cash distributed with respect to a Class
D
Unit in respect of such Quarter pursuant to Sections 6.4(a)(iii)(x) and
6.4(b)(iii)(x).
“Class
D Unit”
means
a
Unit representing a fractional part of the Member Interests of all Members
and,
to the extent they are treated as Members hereunder, Assignees, and having
the
rights and obligations specified with respect to Class D Units in this
Agreement. A “Class D Unit” shall not constitute a Common Unit until such
time
as
such Class D Unit is converted into a Common Unit pursuant to the terms
hereof.
“Common
Unit Arrearage” means, with respect to any Common Unit, whenever issued, as to
any Quarter during which Class D Units are Outstanding, the excess, if any,
of
(a) the Initial Quarterly Distribution with respect to a Common Unit in respect
of such Quarter over (b) the sum of all Available Cash distributed with respect
to a Common Unit in respect of such Quarter pursuant to Sections 6.4(a)(i)
and
6.4(b)(i).
“Conversion
Approval”
has
the
meaning assigned to such term in Section 5.11(d).
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“Cumulative
Class D Unit Arrearage”
means,
with respect to any Class D Unit, whenever issued, as of the end of any Quarter,
the excess, if any, by which (a) the sum resulting from adding together the
Class D Unit Arrearages for each of the Quarters during which any Class D Unit
has been Outstanding exceeds (b) the sum of any distributions theretofore made
to a Class D Unit pursuant to Sections 6.4(a)(iii)(y), 6.4(b)(iii)(y) and 6.6(d)
(including any distributions to be made in respect of the last of such
Quarters).
“Cumulative
Common Unit Arrearage”
means,
with respect to any Common Unit, whenever issued, and as of the end of any
Quarter, the excess, if any, of (a) the sum resulting from adding together
the
Common Unit Arrearage as to an Initial Common Unit for each of the Quarters
during which Class D Units are Outstanding ending on or before the last day
of
such Quarter over (b) the sum of any distributions theretofore made pursuant
to
Sections 6.4(a)(ii), 6.4(b)(ii) and 6.6(b).
“Issue
Price”
means
the price at which a Unit is purchased from the Company, after taking into
account any sales commission or underwriting discount charged to the Company
and
after taking into account any other form of discount with respect to the price
at which a Unit is purchased from the Company. In the case of the Class D Units,
the Issue Price shall be deemed to be $24.78 per Unit and in the case of the
Privately Placed Common Units, $25.50 per Unit.
“Percentage
Interest”
means,
as of any date of determination (a) as to any Unitholder holding Class A Units,
the product obtained by multiplying (i) 2% by (ii) the quotient obtained by
dividing (A) the number of Class A Units held by such Unitholder by (B) the
total number of Outstanding Class A Units; (b) as to any Unitholder holding
Common Units or Class D Units, the product obtained by multiplying (i) 98%
by
(ii) the quotient obtained by dividing (A) the number of Common Units and/or
Class D Units held by such Unitholder by (B) the total number of all Outstanding
Common Units and Class D Units, and (c) as to the holders of other Company
Securities issued by the Company in accordance with Section
5.5,
the
percentage established as a part of such issuance.
“Per
Unit Capital Amount”
means,
as of any date of determination, the Capital Account, stated on a per Unit
basis, as the case may be, underlying any Common Unit (other than a Privately
Placed Common Unit), Class A Unit, Class D Unit or Privately Placed Common
Unit,
as the case may be, held by a Person.
“Private
Placement Value”
means
with respect to the Class D Units and the Privately Placed Common Units, $34.19
per Unit.
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“Privately
Placed Common Units”
means
the Common Units issued pursuant to the Unit Purchase Agreement.
“Unit”
means
a
Company Security that is designated as a “Unit” and shall include Class A Units,
Class D Units and Common Units, but shall not include the Management Incentive
Interests.
“Unit
Purchase Agreement”
means
the Class D Unit and Common Unit Purchase Agreement dated as of May 18, 2007
between the Company and the purchasers named therein.
2. Section
1.1 of the Limited Liability Company Agreement is hereby further amended to
add
a new sentence at the end of the definition of “Common Unit” as
follows:
The
term
“Common Unit” does not include a Class D Unit prior to its conversion into a
Common Unit pursuant to this Agreement.
3. Article
IV of the Limited Liability Company Agreement is hereby amended to add a new
Section 4.6(e) as follows:
(e) The
transfer of (1) a Class D Unit that has
been
converted into a Common Unit pursuant to Section 5.11 or (2) a Privately Placed
Common Unit shall be subject to the restrictions imposed by Section
6.9.
4. Section
5.4(a) of the Limited Liability Company Agreement is hereby amended to add
the
following at the end of such section:
The
initial Capital Account balance in respect of each Class D Unit shall be the
Private Placement Value for such Class D Unit, and the initial Capital Account
balance of each holder of Class D Units in respect of all Class D Units held
shall be the product of such initial balance for a Class D Unit multiplied
by
the number of Class D Units held by such holder. The initial Capital
Account balance in respect of each Privately Placed Common Unit shall be the
Private Placement Value for such Privately Placed Common Unit, and the initial
Capital Account balance of each holder of Privately Placed Common Units in
respect of all Privately Placed Common Units held shall be the product of such
initial balance for a Privately Placed Common Unit multiplied by the number
of
Privately Placed Common Units held by such holder. Immediately following
the creation of a Capital Account balance in respect of each Class D Unit,
each
holder acquiring a Class D Unit at original issuance shall be deemed to have
received a cash distribution in respect of such Class D Units in an amount
equal
to the product of (x) the total number of Class D Units so acquired by such
holder multiplied by (y) the difference between the Private Placement Value
and
the Issue Price of a Class D Unit. Immediately following the creation of a
Capital Account balance in respect of each Privately Placed Common Unit, each
Unitholder acquiring a Privately Placed Common Unit at original issuance shall
be deemed to have received a cash distribution in respect of such Privately
Placed Common Units in an amount equal to the product of (x) the total number
of
Privately Placed Common Units so acquired by such Unitholder multiplied by
(y)
the difference between the Private Placement Value and the Issue Price of a
Privately Placed Common Unit. The purpose of the four preceding sentences
is to provide the initial purchasers of Class D Units and Privately Placed
Common Units with a net Capital Account in the Class D Units and Privately
Placed Common Units on the date of purchase equal to the Issue Price paid by
those purchasers for the Class D Units and Privately Placed Common
Units.
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5. Section
5.4(c)(i) of the Limited Liability Company Agreement is hereby amended to add
the following at the end of such section:
Any
adjustments that are made under this paragraph in connection with the issuance
of the Class D Units or the Privately Placed Common Units shall be based on
the
Private Placement Value of the Class D Units and the Privately Placed Common
Units.
6. Article
V
of the Limited Liability Company Agreement is hereby amended to add a new
Section 5.11 creating a new series of Company Securities as
follows:
Section
5.11 Establishment
of Class D Units.
(a) General.
The Board hereby designates and creates a series of Company Securities to be
designated as “Class D Units” and consisting of a total of 16,702,828 Class D
Units, and fixes the designations, preferences and relative, participating,
optional or other
special rights, powers and duties of holders of the Class D Units as set forth
in this Section 5.11. A form of Certificate Evidencing Class D Units is attached
as Exhibit 4.2.
(b) Rights
of Class D Units. During
the period commencing upon issuance of the Class D Units and ending on the
upon
Conversion Approval (or that later time specified in this Section 5.11(b)),
unless amended pursuant to Section 5.11(h) hereof:
(i)
Allocations.
Except
as
otherwise provided in this Agreement, all items of Company income, gain, loss,
deduction and credit shall be allocated to the Class D Units to the same extent
as such items would be so allocated if such Class D Units were Common Units
(other than Privately Placed Common Units) that were then
Outstanding.
(ii)
Distributions.
Except
as
otherwise specified in this Agreement, Class D Units shall have the right to
the
distributions specified in Article VI of this Agreement.
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(iii) Elimination
of Cumulative Class D Unit Arrearages Upon Conversion.
If a
Cumulative Class D Unit Arrearage exists at the time of Conversion Approval,
Available Cash shall be distributed 98% to the Unitholders holding Class D
Units, Pro Rata, and 2% to the holders of Class A Units, Pro Rata, until there
has been distributed in respect of each Class D Unit then Outstanding an amount
equal to the Cumulative Class D Unit Arrearage as of such date. This
distribution shall not be deemed a distribution on a Common Unit, but the
satisfaction of prior entitlements of the holders of Class D Units as of
Conversion Approval. For the taxable year in which the distribution is made,
if
not previously allocated, each Person receiving such distribution shall be
allocated items of gross income in an amount equal to such distribution as
provided in Section 6.1(d)(iii)(C).
(c) [Reserved]
(d) Vote
of Unitholders.
Except as provided in this Section 5.11, the Class D Units are not convertible
into Common Units. The Board shall, as promptly as practicable following
the issuance of the Class D Units, but in any event not later than 135 days
after the date hereof,
take
such actions as may be necessary or appropriate to submit to a vote or consent
of the holders of the Units the approval of a change in the terms of the Class
D
Units to provide that each Class D Unit will automatically convert into one
Common Unit (subject to appropriate adjustment in the event of any split-up,
combination or similar event affecting the Common Units that occurs prior to
the
conversion of the Class D Units), except that for purposes of this Section
5.11(d) the term “Unitholders” shall not include the holders of Class D Units
(the “Conversion Approval”). Effective immediately upon the Conversion Approval
by the Unitholders, the issuance of additional Common Units to be issued upon
such automatic conversion shall be approved without any further action by the
holders thereof. The vote or consent required for such approval will be
the requisite vote required under this Agreement and under the rules or staff
interpretations of the National Securities Exchange on which the Common Units
are listed or admitted to trading for the listing or admission to trading of
the
Common Units that would be issued upon any such conversion. Upon receipt
of such approval and compliance with Section 5.11(f), the terms of the Class
D
Units will be changed, automatically and without further action, so that each
Class D Unit is converted into one Common Unit and, immediately thereafter,
none
of the Class D Units shall be Outstanding.
(e) Change
in Rules of National Securities Exchange.
If at any time (i) the rules of the National Securities Exchange on which the
Common Units are listed or admitted to trading or the staff interpretations
of
such rules are changed or (ii) facts or circumstances arise so that no vote
or
consent of Unitholders (except that for purposes of this Section 5.11(e) the
term “Unitholders” shall not include the holders of the Class D Units) is
required as a condition to the listing or admission to trading of the Common
Units that would be issued upon any conversion of any Class D Units into Common
Units as provided in Section 5.11(d), the terms of such Class D Units will
be
changed so that each Class D Unit is converted (without further action or any
vote of any Unitholders other than compliance with Section 5.11(f)) into one
Common Unit (subject to appropriate adjustment in the event of any split-up,
combination or similar event affecting the Common Units that occurs prior to
the
conversion of the Class D Units) and, immediately thereafter, none of the Class
D Units shall be Outstanding.
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(f) Surrender
of Certificates.
Upon
receipt of the approval of the holders of the Units (other than holders of
the
Class D Units, who do not vote as part of the Conversion Approval) to convert
the Class D Units into Common Units in accordance with Section 5.11(d) or a
change in rules of the National Securities Exchange or a change in facts and
circumstances as described in Section 5.11(e), the Board shall give the holders
of the Class D Units prompt notice of such approval or change and, subject
to
Section 6.9, each holder of Class D Units shall promptly surrender the Class
D
Unit Certificates therefor, duly endorsed, at the office of the Company or
of
any transfer agent for the Class D Units. In the case of any such
conversion, the Company shall, as soon as practicable thereafter, issue and
deliver at such office to such holder of Class D Units one or more Unit
Certificates, registered in the name of such holder, for the number of Common
Units to which such holder shall be entitled as aforesaid. Such conversion
shall be deemed to have been made as of the date of the event specified in
Section 5.11(d) or Section 5.11(e), as the case may be, and the Person entitled
to receive the Common Units issuable upon such conversion shall be treated
for
all purposes as the record holder of such Units on said date.
(g) Voting
Rights.
The
Class D Units are non-voting, except that the Class D Units shall be entitled
to
vote as a separate class on any matter that adversely affects the rights or
preferences of the Class D Units in relation to other classes of Interests
(including as a result of a merger or consolidation) or as required by
law. The approval of a majority of the Class D Units shall be required to
approve any matter for which the holders of the Class D Units are entitled
to
vote.
(h) Automatic
Provisions.
If the
Conversion Approval has not occurred within 135 days after the date hereof,
then, effective as of the next succeeding day (the “Class D Distribution
Increase Date”) until the Conversion Approval is obtained, Section 5.11(b) will
be deemed to be amended in its entirety, automatically and without further
action, as follows:
(b)
Rights
of Class D Units. Prior
to
the Conversion Approval (or the later date specified in this Section
5.11(b)):
(i)
Allocations.
Except
as
otherwise provided in this Agreement, all items of Company income, gain, loss,
deduction and credit shall be allocated to the Class D Units to the same extent
as such items would be so allocated if such Class D Units were Common Units
(other than Privately Placed Common Units) that were then
Outstanding.
8
(ii)
Distributions.
Except
as
otherwise specified in this Agreement, Class D Units shall have the right to
the
distributions specified in Article VI of this Agreement. Notwithstanding the
provisions of Article VI:
(A)
Sections 6.4(a)(iii) and 6.4(b)(iii) shall be applied by substituting “115%” for
“100%”.
(B) Each
Class D Unit shall be entitled to 115% of the amount distributed per Common
Unit
pursuant to Sections 6.4(a)(iv), 6.4(b)(iv), 6.4(b)(v) and
6.4(b)(vi).
(iii) Elimination
of Cumulative Class D Unit Arrearages Upon Conversion.
If a
Cumulative Class D Unit Arrearage exists at the time of Conversion Approval,
Available Cash shall be distributed 98% to the Unitholders holding Class D
Units, Pro Rata, and 2% to the holders of Class A Units, Pro Rata, until there
has been distributed in respect of each Class D Unit then Outstanding an amount
equal to the Cumulative Class D Unit Arrearage as of such date. This
distribution shall not be deemed a distribution on a Common Unit, but the
satisfaction of prior entitlements of the holders of Class D Units as of
Conversion Approval. For the taxable year in which the distribution is made,
if
not previously allocated, each Person receiving such distribution shall be
allocated items of gross income in an amount equal to such distribution as
provided in Section 6.1(d)(iii)(C).
7. Section
6.1(c)(ii) of the Limited Liability Company Agreement is hereby amended and
restated as follows:
(ii) If
a Net
Termination Loss is recognized (or deemed recognized pursuant to Section
5.4(c)), such Net Termination Loss shall be allocated among the Members in
the
following manner:
(A) First,
2%
to the holders of Class A Units, Pro Rata, and 98% to the holders of Class
D
Units, Pro Rata, until the Capital Account in respect to each Class D Unit
then
Outstanding has been reduced to zero;
(B) Second,
2% to the holders of Class A Units, Pro Rata, and 98% to the holders of Common
Units, Pro Rata, until the Capital Account in respect to each Common Unit then
Outstanding has been reduced to zero; and
(C) Third,
the balance, if any, to all Unitholders in accordance with their respective
Percentage Interests.
9
8. Article
VI of the Limited Liability Company Agreement is hereby amended to add a new
Section 6.1(d)(iii)(C) as follows:
(C) After
the
application of Sections 6.1(d)(iii)(A) and (B), if the amount of cash or the
Net
Agreed Value of any property distributed (except cash or property distributed
or
deemed distributed pursuant to Section 5.4(a) of this Agreement with respect
to
Class D Units or Privately Placed Common Units, or Section 10.3 of this
Agreement) to any Unitholder with respect to its Units for a taxable year is
greater (on a per Unit basis) than the amount of cash or the Net Agreed Value
of
property distributed to the other Unitholders with respect to their Units (on
a
per Unit basis), then each Unitholder receiving such greater cash or property
distribution shall be allocated gross income in an amount equal to the product
of (a) the amount by which the distribution (on a per Unit basis) to such
Unitholder exceeds the distribution (on a per Unit basis) to the Unitholders
receiving the smallest distribution and (b) the number of Units owned by the
Unitholder receiving the greater distribution.
9. Article
VI of the Limited Liability Company Agreement is hereby amended to add a new
Section 6.1(d)(xii) as follows:
(xii) Allocations
for Class D Units and Privately Placed Common Units.
(A) With
respect to any taxable period of the Company ending upon, or after, a Book-Up
Event, a Book-Down Event or a sale of all or substantially all of the assets
of
the Company occurring after the date of issuance of the Class D Units and the
Privately Placed Common Units, Company items of income or gain for such taxable
period shall be allocated 100% (1) to the Members holding Class D Units or
converted Class D Units that are Outstanding as of the time of such event in
proportion to the number of Class D Units or converted Class D Units held by
such Members, until each such Member has been allocated the amount that
increases the Capital Account of such Class D Unit or converted Class D Unit
to
the Per Unit Capital Amount for a then outstanding Common Unit (other than
a
converted Class D Unit or a Privately Placed Common Unit) and (2) to the Members
holding Privately Placed Common Units that are Outstanding as of the time of
such event in proportion to the number of Privately Placed Common Units held
by
such Members, until each such Member has been allocated the amount that
increases the Capital Account of such Privately Placed Common Unit to the Per
Unit Capital Amount for a then outstanding Common Unit (other than a Privately
Placed Common Unit or a Class D Unit).
(B) With
respect to any taxable period of the Company ending upon, or after, the transfer
of converted Class D Units or Privately Placed Common Units to a Person that
is
not an Affiliate of the holder, Company items of income or gain for such taxable
period shall be allocated 100% (1) to the Members transferring such converted
Class D Units in proportion to the number of converted Class D Units transferred
by such Members, until each such Member has been allocated the amount that
increases the Capital Account of such converted Class D Unit to the Per Unit
Capital Amount for a then outstanding Common Unit (other than a converted Class
D Unit or a Privately Placed Common Unit) and (2) to the Members transferring
such Privately Placed Common Units in proportion to the number of Privately
Placed Common Units transferred by such Members, until each such Member has
been
allocated the amount that increases the Capital Account of such Privately Placed
Common Unit to the Per Unit Capital Amount for a then outstanding Common Unit
(other than a Privately Placed Common Unit or a converted Class D
Unit).
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(C) With
respect to the first taxable period of the Company ending upon, or after, the
date of issuance of the Class D Units or the Privately Placed Common Units,
at
the election of a Member holding Class D Units or Privately Placed Common Units
(the “Capital Account True-Up Election”), items of income or gain for such
taxable period shall be allocated 100% to the Members making such Capital
Account True-Up Election with respect to Class D Units or Privately Placed
Common Units held by such Members, until each such Member has been allocated
the
amount that increases the Capital Account of such Class D Unit or Privately
Placed Common Unit to the Per Unit Capital Amount for a then outstanding Common
Unit (other than a Class D Unit or a Privately Placed Common Unit).
10. Section
6.4 of the Limited Liability Company Agreement is amended to read as
follows:
Section
6.4 Distributions
of Available Cash from Operating Surplus.
(a) During
the MII Vesting Period.
Available Cash with respect to any Quarter ending prior to or on the date of
the
end of the MII Vesting Period that is deemed to be Operating Surplus pursuant
to
the provisions of Section 6.3 or Section 6.6 shall, subject to Section 8-607
of
the Delaware Act, be distributed, except as otherwise required by Section 5.5(b)
in respect of other Company Securities issued pursuant thereto, as follows:
(i) First,
(A) 2% to the holder(s) of the Class A Units, Pro Rata and (B) 98% to the
holders of the Common Units, Pro Rata until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Initial
Quarterly Distribution for such Quarter;
(ii) Second,
(A) 2% to the holder(s) of the Class A Units, Pro Rata and (B) 98% to the
holders of the Common Units, Pro Rata until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage existing with respect to such Quarter;
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(iii) Third,
(x)
(A)
2% to
the holder(s) of the Class A Units, Pro Rata and (B) 98% to the holders of
the
Class D Units, Pro Rata,
until
there has been distributed in respect of each Class D Unit then Outstanding
an
amount equal to 100% of the Initial Quarterly Distribution for such Quarter;
and
(y) (A)
2% to
the holder(s) of the Class A Units, Pro Rata and (B) 98% to the holders of
the
Class D Units, Pro Rata,
until
there has been distributed in respect of each Class D Unit then Outstanding
an
amount equal to the Cumulative Class D Unit Arrearage, if any, existing with
respect to such Quarter;
(iv)
Fourth, (A) 2% to the holder(s) of the Class A Units, Pro Rata and (B) 98%
to
the holders of the Common Units and Class D Units, Pro Rata.
(b) After
the MII Vesting Period.
Available Cash with respect to each Quarter after the MII Vesting Period that
is
deemed to be Operating Surplus pursuant to the provisions of Section
6.3
or
Section
6.6
shall,
subject to Section 18-607 of the Delaware Act, be distributed, except as
otherwise required by Section
5.5(b)
in
respect of additional Company Securities issued pursuant thereto, as
follows:
(i) First,
(A) 2% to the holder(s) of the Class A Units, Pro Rata and (B) 98% to the
holders of the Common Units, Pro Rata until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Initial
Quarterly Distribution for such Quarter;
(ii) Second,
(A) 2% to the holder(s) of the Class A Units, Pro Rata and (B) 98% to the
holders of the Common Units, Pro Rata until there has been distributed in
respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage existing with respect to such Quarter;
(iii) Third,
(x)
(A)
2% to
the holder(s) of the Class A Units, Pro Rata and (B) 98% to the holders of
the
Class D Units, Pro Rata,
until
there has been distributed in respect of each Class D Unit then Outstanding
an
amount equal to 100% of the Initial Quarterly Distribution for such Quarter;
and
(y) (A)
2% to
the holder(s) of the Class A Units, Pro Rata and (B) 98% to the holders of
the
Class D Units, Pro Rata,
until
there has been distributed in respect of each Class D Unit then Outstanding
an
amount equal to the Cumulative Class D Unit Arrearage, if any, existing with
respect to such Quarter;
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(iv) Fourth,
(A) 2% to the holders of Class A Units, Pro Rata, and (B) 98% to the holders
of
Common Units and Class D Units, Pro Rata, until there has been distributed
in
respect of each Class A Unit, each Class D Unit and each Common Unit then
Outstanding an amount equal to the Initial Quarterly Distribution for such
Quarter plus $0.06 (the “First
Target Distribution”);
(v) Fifth,
(A) 2% to the holders of the Class A Units, Pro Rata, (B) 83% to the holders
of
the Common Units and Class D Units, Pro Rata, and (C) 15% to the holders of
the
Management Incentive Interests, Pro Rata, until there has been distributed
in
respect of each Class A Unit, each Class D Unit and each Common Unit then
Outstanding an amount equal to the Initial Quarterly Distribution for such
Quarter plus $0.17 (the “Second
Target Distribution);
and
(vi) Thereafter,
(A) 2% to the holders of the Class A Units, Pro Rata, (B) 73% to the holders
of
the Common Units and Class D Units, Pro Rata, and (C) 25% to the holders of
the
Management Incentive Interests, Pro Rata.
11. Section
6.6 of the Limited Liability Company Agreement is amended to read as
follows:
Section
6.6 Distributions
of Available Cash from Capital Surplus
Available
Cash that is deemed to be Capital Surplus pursuant to the provisions of
Section 6.3(a)
shall,
subject to Section 18-607 of the Delaware Act, be distributed, unless the
provisions of Section
6.3
require
otherwise, be distributed as follows:
(a)
100%
to the holders of Common Units, Pro Rata, until a hypothetical holder of a
Common Unit acquired on the Closing Date has received with respect to such
Common Unit, during the period since the Closing Date through such date,
distributions of Available Cash that are deemed to be Capital Surplus in an
aggregate amount equal to the Initial Unit Price;
(b)
100%
to the holders of Common Units, Pro Rata, until there has been distributed
in
respect of each Common Unit then Outstanding an amount equal to the Cumulative
Common Unit Arrearage. Thereafter, all Available Cash shall be distributed
as if
it were Operating Surplus and shall be distributed in accordance with
Section 6.4.
13
(c)
100%
to the holders of Class D Units, Pro Rata, until a hypothetical holder of a
Class D Unit acquired on the Closing Date has received with respect to such
Class D Unit, during the period since the date Class D Units were originally
issued through such date, distributions of Available Cash that are deemed to
be
Capital Surplus in an aggregate amount equal to the Initial Unit
Price;
(d)
100%
to the holders of Class D Units, Pro Rata, until there has been distributed
in
respect of each Class D Unit then Outstanding an amount equal to the Cumulative
Class D Unit Arrearage; and
(e)
Thereafter, all Available Cash shall be distributed as if it were Operating
Surplus and shall be distributed in accordance with
Section 6.4.
12. Article
VI is hereby amended to add a new Section 6.9 as follows:
Section
6.9 Special
Provisions Relating to Holders of Converted Class D Units and Privately Placed
Common Units.
A
holder of (1) a Privately Placed Common Unit or (2) a Class D Unit that has
converted into a Common Unit pursuant to Section 5.11 shall be required to
provide notice to the Board of the number of Privately Placed Common Units
or
converted Class D Units transferred by such holder no later than the last
Business Day of the calendar year during which such transfer occurred, unless
(x) the transfer is to an Affiliate of the holder or (y) by virtue of the
application of Section 6.1(d)(xii)(B) to a prior transfer of the Common Unit
or
the application of Section 6.1(d)(xii)(A) or Section 6.1(d)(xii)(C), the Board
has previously determined, based on advice of counsel, that the Privately Placed
Common Unit or converted Class D Unit should have, as a substantive matter,
like
intrinsic economic and federal income tax characteristics of an Initial Common
Unit; provided, that such holder may cure any failure to provide such notice
by
providing such notice within 20 days of the last Business Day of such calendar
year. The sole and exclusive remedy for any holder’s failure to provide
any such notice shall be the enforcement of the remedy of specific performance
against such holder and there will be no monetary damages. In connection
with the condition imposed by this Section 6.9, the Board shall take whatever
steps are required to provide economic uniformity to the Privately Placed Common
Units and converted Class D Units in preparation for a transfer thereof,
including the application of Section 6.1(d)(xii)(B); provided,
however,
that no
such steps may be taken that would have a material adverse effect on the
Unitholders holding Common Units represented by Certificates.
14
B. Agreement
in Effect.
Except as hereby amended, the Limited Liability Company Agreement shall remain
in full force and effect.
C. Applicable
Law.
This Amendment shall be construed in accordance with and governed by the laws
of
the State of Delaware, without regard to principles of conflicts of
laws.
D. Invalidity
of Provisions.
If any provision of this Amendment is or becomes invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of
the
remaining provisions contained herein shall not be affected
thereby.
15
IN
WITNESS WHEREOF, this Amendment has been executed as of the date first written
above.
|
ATLAS
ENERGY RESOURCES, LLC
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||
| |
|
|
| By: | ||
|
Name:
|
||
| Title: | ||
[Signature
Page to Form of Class D Amendment]
16
Exhibit
4.2
|
Certificate
Evidencing Class D Units
|
|
|
|
Certificate
No. _____
|
Representing
Limited Liability Company Interests in
|
Class
D Units
|
|
|
Atlas
Energy Resources, LLC
|
|
In
accordance with Section 4.1 of the Amended and Restated Operating Agreement
of
Atlas Energy Resources, LLC, as amended, supplemented or restated from time
to
time (the “Company Agreement”), Atlas Energy Resources, LLC, a Delaware limited
liability company (the “Company”), hereby certifies that
__________________________________________ (the “Holder”) is the registered
owner of ___________ CLASS
D UNITS representing limited liability company interests in the Company
(the “Class
D Units”)
transferable on the books of the Company, in person or by duly authorized
attorney, upon surrender of this Certificate properly endorsed. The
rights, preferences and limitations of the Class D Units are set forth in,
and
this Certificate and the Class D Units represented hereby are issued and shall
in all respects be subject to the terms and provisions of, the Company
Agreement. Copies of the Company Agreement are on file at, and will be
furnished without charge on delivery of written request to the Company at,
the
principal office of the Company located at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇
▇▇▇▇▇. Capitalized terms used herein but not defined shall have the
meanings given them in the Company Agreement.
The
Holder, by accepting this Certificate, is deemed to have (i) requested admission
as, and agreed to become, a Member and to have agreed to comply with and be
bound by and to have executed the Company Agreement, (ii) represented and
warranted that the Holder has all right, power and authority and, if an
individual, the capacity necessary to enter into the Company Agreement, (iii)
granted the powers of attorney provided for in the Company Agreement and
(iv) made the waivers and given the consents and approvals contained in the
Company Agreement.
This
Certificate shall not be valid for any purpose unless it has been signed by
duly
authorized officers of the Company.
|
ATLAS
ENERGY RESOURCES, LLC
|
||
| |
|
|
| By: | ||
|
Chairman,
President and Chief Executive
Officer
|
||
| By: | ||
|
Secretary
|
||
“THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THESE SECURITIES MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED (EXCEPT IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR
OTHER
LOAN OR FINANCING ARRANGEMENT SECURED BY THESE SECURITIES) OR HYPOTHECATED
IN
THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES
UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION THEREUNDER AND,
IN
THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS SOLD PURSUANT TO
RULE
144 UNDER SUCH ACT OR THE ISSUER HAS RECEIVED DOCUMENTATION REASONABLY
SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER
SUCH ACT.” FOR THE AVOIDANCE OF DOUBT, THE PURCHASED UNITS AND THE PURCHASED
CLASS D UNITS MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR
OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY SUCH PURCHASED UNITS OR PURCHASED
CLASS D UNITS AND SUCH PLEDGE SHALL NOT BE DEEMED TO BE A TRANSFER, SALE OR
ASSIGNMENT OF SUCH PURCHASED UNITS OR PURCHASED CLASS D UNITS, AND NO BUYER
EFFECTING SUCH A PLEDGE SHALL BE REQUIRED TO PROVIDE ATLAS ENERGY WITH ANY
NOTICE THEREOF OR OTHERWISE MAKE ANY DELIVERY TO ATLAS ENERGY PURSUANT TO THIS
AGREEMENT OR ANY OTHER BASIC DOCUMENT.
17
Atlas
Energy Resources, LLC
[Reverse
of Certificate]
ABBREVIATIONS
The
following abbreviations, when used in the inscription on the face of this
Certificate, shall be construed as follows according to applicable laws or
regulations:
|
TEN
COM
|
-
|
as
tenants in common
|
|
UNIF
GIFT MIN ACT-
|
|
Custodian
|
|
|
TEN
ENT
|
-
|
as
tenants by the entireties
|
|
|
(Cust)
|
|
(Minor)
|
|
JT
TEN
|
-
|
as
joint tenants with right of
|
|
under
Uniform Gifts to Minors
|
|||
|
|
|
survivorship
and not as tenants in
|
|
Act
|
|
|
|
|
|
|
common |
|
|
(State)
|
|
|
Additional
abbreviations, though not in the above list, may also be used.
ASSIGNMENT
OF CLASS D UNITS
In
Atlas
Energy Resources, LLC
FOR
VALUE
RECEIVED,
_________________ hereby
assigns, conveys, sells and transfers unto
|
|
||
|
(Please
print or typewrite name and address of Assignee)
|
||
|
|
|
|
|
|
|
|
|
|
|
(Please
insert Social Security or other identifying number of
Assignee)
|
______________________________
Class D Units representing limited liability company interests evidenced
by this
Certificate, subject to the Company Agreement,
and does hereby irrevocably constitute and appoint ________________
as
its
attorney-in-fact with full power of substitution to transfer
the same on the books of Atlas Energy Resources, LLC.
| Date: _____________________ |
NOTE:
The signature to any endorsement hereon
|
|
|
must correspond
with the name as written upon the face of this Certificate in every
particular, without alteration, enlargement or
change.
|
|
The
signature(s) should be guaranteed by an “eligible
|
||
|
guarantor
institution” as defined in Rule 17Ad-15 under the Securities and Exchange
Act of 1934, as amended
|
(Signature)
|
|
|
(Signature)
|
SIGNATURE(S)
GUARANTEED:
No
assignment or transfer of the Class D Units evidenced hereby will be registered
on the books of the Company unless the Certificate evidencing the Class D
Units
to be transferred is surrendered for registration or transfer.
18