EXHIBIT 99.2
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NEW OMNIBUS AGREEMENT
among
WEG Acquisitions, L.P.,
▇▇▇▇▇▇▇▇ Energy Services, LLC,
▇▇▇▇▇▇▇▇ Natural Gas Liquids, Inc.
and
The ▇▇▇▇▇▇▇▇ Companies, Inc.
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NEW OMNIBUS AGREEMENT
THIS NEW OMNIBUS AGREEMENT (the "Agreement") is entered into on, and
effective as of, _____________, 2003 among WEG Acquisitions, L.P., a Delaware
limited partnership ("Buyer"), ▇▇▇▇▇▇▇▇ Energy Services, LLC, a Delaware limited
liability company ("▇▇▇"), ▇▇▇▇▇▇▇▇ Natural Gas Liquids, Inc., a Delaware
corporation ("WNGL"), and The ▇▇▇▇▇▇▇▇ Companies, Inc., a Delaware corporation
("▇▇▇▇▇▇▇▇", and together with ▇▇▇ and WNGL, the "▇▇▇▇▇▇▇▇ Parties").
RECITALS:
WHEREAS, ▇▇▇▇▇▇▇▇, ▇▇▇, WNGL, ▇▇▇▇▇▇▇▇ Pipe Line Company, LLC, a
Delaware limited liability company ("WPL"), ▇▇▇▇▇▇▇▇ Energy Partners, L.P., a
Delaware limited partnership (the "MLP"), ▇▇▇▇▇▇▇▇ ▇▇▇, ▇.▇., a Delaware limited
partnership (the "OLP"), ▇▇▇▇▇▇▇▇ ▇▇ LLC, a Delaware limited liability company
(the "Old GP"), and ▇▇▇▇▇▇▇▇ Information Technology, Inc., a Delaware
corporation, entered into that certain Omnibus Agreement, effective as of
February 9, 2001, as amended by the Amendment I thereto, dated January 28, 2002,
the Second Amendment thereto, dated April 11, 2002, and the Third Amendment
thereto, dated September 30, 2002, (as amended, the "Old Omnibus Agreement");
WHEREAS, Buyer, ▇▇▇, WNGL and the Old GP have entered into that certain
Purchase Agreement, dated April ____, 2003 (the "Purchase Agreement"), for the
purchase and sale of all of the membership interests of the WEG GP LLC, a
Delaware limited liability company ("WEG GP LLC"), all of the common units and
subordinated units representing limited partner interests in the MLP owned by
▇▇▇ and WNGL, and all of the class B common units representing limited partner
interests in the MLP owned by the Old GP (as contemplated in the Purchase
Agreement, the "Transaction");
WHEREAS, the Old Omnibus Agreement will terminate upon closing of the
Transaction (the "Closing Date"); and
WHEREAS, the parties hereto specifically intend for each of the
entities comprising the Partnership Entities and the Partnership Group, as
applicable, to be third-party beneficiaries with respect to certain of the
rights and benefits herein of the parties hereto.
NOW, THEREFORE, in consideration of the premises and the covenants,
conditions, and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS.
(a) Capitalized terms used herein but not defined shall have
the meanings given to them in the MLP Agreement.
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(b) As used in this Agreement, the following terms shall have
the respective meanings set forth below:
"Accounting Referee" is defined in Section 9.1(a).
"Acquisition Date" means April 11, 2002, the date ▇▇▇
contributed and the MLP acquired all of the membership interests in
WPL.
"Affiliate" of a Person means a Person that directly or
indirectly, through one or more intermediaries, controls, is controlled
by, or is under common control with, the first-mentioned Person.
"Applicable Period" means the period commencing on the Closing
Date and terminating on the second (2nd) anniversary of the Closing
Date.
"Assignee" is defined in the MLP Agreement.
"Buyer" is defined in the introduction to this Agreement.
"Buyer Entities" means the Buyer and any entity that directly,
or indirectly through one or more intermediaries, is controlled by the
Buyer, including WEG GP LLC (but excluding each entity comprising the
Partnership Group).
"Buyer Offer" is defined in Section 3.3(a).
"Change of Control" means, with respect to any Person (the
"Applicable Person"), any of the following events:
(i) any sale, lease, exchange or other transfer (in
one transaction or a series of related transactions) of all or
substantially all of the Applicable Person's assets to any other
Person, unless immediately following such sale, lease, exchange or
other transfer such assets are owned, directly or indirectly, by the
Applicable Person;
(ii) the consolidation or merger of the Applicable
Person with or into another Person pursuant to a transaction in which
the outstanding Voting Securities of the Applicable Person are changed
into or exchanged for cash, securities or other property, other than
any such transaction where (a) the outstanding Voting Securities of the
Applicable Person are changed into or exchanged for Voting Securities
of the surviving corporation or its parent and (b) the holders of the
Voting Securities of the Applicable Person immediately prior to such
transaction own, directly or indirectly, not less than a majority of
the Voting Securities of the surviving corporation or its parent
immediately after such transaction;
(iii) a "person" or "group" (within the meaning of
Sections 13(d) or 14(d)(2) of the Exchange Act) being or becoming the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that a person or group shall be deemed to have
"beneficial ownership" of all Voting Securities that such person or
group has the right to acquire, whether such right is exercisable
immediately or only after the
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passage of time) of more than 50% of all of the then outstanding Voting
Securities of the Applicable Person, except in a merger or
consolidation that would not constitute a Change of Control under
clause (ii) above; and
(iv) solely with respect to WEG GP LLC, the
Continuing Directors of WEG GP LLC cease for any reason to constitute
all of the board of directors of WEG GP LLC then in office;
notwithstanding the foregoing, the events described in clauses (i)
through (iii) of this definition shall not constitute a Change of
Control of WEG GP LLC if the other Person (or "person" or "group," in
the case of clause (iii)) referred to in such clauses, immediately
prior to such transaction, is an Affiliate of Buyer or WEG GP LLC.
"Closing" is defined in the recitals to this Agreement.
"Closing Date" is defined in the recitals to this Agreement.
"Conflicts Committee" is defined in the MLP Agreement.
"Continuing Directors" means (1) all individuals constituting
the board of directors of WEG GP LLC immediately after the Closing and
(2) any new directors whose nomination for election to the board of
directors of WEG GP LLC was approved by WEG GP LLC or the board of
directors of WEG GP LLC, or the nominating committee of such board, at
a time that Continuing Directors comprised all of such board of
directors.
"control" means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies
of a Person, whether through ownership of voting securities, by
contract or otherwise.
"Covered Environmental Losses" is defined in Section 4.1.
"Environmental Laws" means all federal, state, and local laws,
statutes, rules, regulations, orders, and ordinances relating to
protection of health and the environment including, without limitation,
the federal Comprehensive Environmental Response, Compensation, and
Liability Act, the Superfund Amendments Reauthorization Act, the
Resource Conservation and Recovery Act, the Clean Air Act, the Federal
Water Pollution Control Act, the Toxic Substances Control Act, the Oil
Pollution Act, the Safe Drinking Water Act, the Hazardous Materials
Transportation Act, and other environmental conservation and protection
laws, each as amended through the IPO Date.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"G&A Cap Amount" is defined in Section 7.1(a).
"General Partner" means WEG GP LLC and its successors as
general partner of the MLP, unless the context otherwise requires.
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"IPO Assets" is defined in Section 4.1.
"IPO Date" means February 9, 2001, the date of the closing of
the initial public offering of common units representing limited
partner interests in the MLP.
"Limited Partner" is defined in the MLP Agreement.
"MLP" is defined in the introduction to this Agreement.
"MLP Agreement" means the Second Amended and Restated
Agreement of Limited Partnership of the MLP, dated as of September 27,
2002, as amended by Amendments Nos. 1 and 2 thereto, each dated as of
November 15, 2002, as such agreement may be further amended or
supplemented through the Closing Date, to which reference is hereby
made for all purposes of this Agreement. No amendment or modification
to the MLP Agreement subsequent to the Closing Date shall be given
effect for the purposes of this Agreement unless consented to by each
of the parties to this Agreement.
"OLP" is defined in the introduction to this Agreement.
"Old Omnibus Agreement" is defined in the recitals to this
Agreement.
"Partnership Entities" means the General Partner, the MLP, the
OLP, WPL and any entity controlled by any of the foregoing.
"Partnership Group" means the Partnership Entities, with the
exclusion of the General Partner.
"Payment Request" is defined in Section 9.1(a).
"Person" means an individual, corporation, partnership, joint
venture, trust, limited liability company, unincorporated organization
or any other entity.
"Prospectus" means the MLP's final prospectus, dated February
5, 2001, relating to the initial public offering of common units
representing limited partner interests in the MLP, as filed with
Securities and Exchange Commission pursuant to Rule 424(b) under the
Securities Act of 1933.
"Purchase Agreement" is defined in the recitals to this
Agreement.
"Refined Products" means all grades of motor gasoline,
distillate and aviation fuel.
"Restricted Assets" means, (i) with respect to the ▇▇▇▇▇▇▇▇
Entities, for purposes of Article II, any assets or any business having
assets engaged in the activities prohibited by Section 2.1 and (ii)
with respect to the Buyer Entities, for purposes of Article III, any
assets or any business having assets engaged in the activities
prohibited by Section 3.1.
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"Transaction" is defined in the recitals to this Agreement.
"Upper Cap Amount" is defined in Section 7.2(c)(i).
"Voting Securities" means securities of any class of a Person
entitling the holders thereof to vote on a regular basis in the
election of members of the board of directors or other similar
governing body of such Person; provided, however, that in the case of
WEG GP LLC, "Voting Securities" shall refer solely to the membership
interests in WEG GP LLC.
"WAP LP" is defined in Section 5.1.
"WEG GP LLC" is defined in the recitals to this Agreement.
"▇▇▇" is defined in the introduction to this Agreement.
"▇▇▇▇▇▇▇▇" is defined in the introduction to this Agreement.
"▇▇▇▇▇▇▇▇ Entities" means ▇▇▇▇▇▇▇▇ and any entity that
directly, or indirectly through one or more intermediaries, controls,
is controlled by or is under common control with ▇▇▇▇▇▇▇▇, including
without limitation, WNGL, ▇▇▇ and the Old GP.
"▇▇▇▇▇▇▇▇ Offer" is defined in Section 2.3(a).
"▇▇▇▇▇▇▇▇ Parties" is defined in the recitals to this
Agreement.
"WNGL" is defined in the introduction to this Agreement.
"WPL" is defined in the recitals to this Agreement.
"WTH LP" is defined in Section 5.2.
"2003 Pre-Closing Stub Period" is defined in Section
7.1(b)(i)(A).
"2003 Pre-Closing Cap" is defined in Section 7.1(b)(i)(A).
"2003 Post-Closing Stub Period" is defined in Section
7.1(b)(i)(B).
"2003 Post-Closing Cap" is defined in Section 7.1(b)(i)(B).
"2003 Post-Closing Upper Cap Amount" is defined in Section
7.2(c)(ii)(A).
"2004 Stub Period" is defined in Section 7.2(c)(iii)(B).
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"2004 Stub Period Upper Cap Amount" is defined in Section
7.2(c)(iii)(B).
ARTICLE II
▇▇▇▇▇▇▇▇ ENTITIES' BUSINESS OPPORTUNITIES
2.1 ▇▇▇▇▇▇▇▇ ENTITIES RESTRICTED ASSETS. During the Applicable Period,
the ▇▇▇▇▇▇▇▇ Entities shall be prohibited from engaging in or acquiring any
business having assets engaged in the following activities:
(a) the transportation, storage or distribution of ammonia or
related products in the United States;
(b) the ownership and operation of facilities for the
terminalling and storage of refined petroleum products in any state in the
United States, except Alaska and Hawaii;
(c) Refined Product transportation (including, without
limitation, through joint tariff arrangements or capacity leases or otherwise)
to a delivery point within a 50-mile radius of a Refined Products delivery point
owned or supplied by a Partnership Entity on the Acquisition Date; and
(d) Refinery grade butane transportation from the ▇▇▇▇ Pine
Bend, MN, refinery, Marathon St. ▇▇▇▇, MN refinery, ExxonMobil Joilet refinery,
▇▇ ▇▇▇▇▇▇▇, IN refinery and CITGO Lemont, IL refinery.
2.2 PERMITTED EXCEPTIONS. Notwithstanding any provision of Section 2.1
to the contrary, any ▇▇▇▇▇▇▇▇ Entity may own and operate Restricted Assets under
the following circumstances:
(a) The Restricted Asset was owned, leased or operated by the
▇▇▇▇▇▇▇▇ Entities on the Closing Date.
(b) The value of the Restricted Assets acquired after the
Closing Date in a transaction does not exceed $20 million at the time of the
acquisition, as determined by ▇▇▇▇▇▇▇▇, in its reasonable sole discretion.
(c) (i) The value of the Restricted Assets acquired after the
Closing Date in a transaction exceeds $20 million at the time of acquisition, as
determined by ▇▇▇▇▇▇▇▇, in its reasonable sole discretion, and (ii) the General
Partner has elected not to cause a member of the Partnership Group to pursue
such opportunity in accordance with the procedures set forth in Section 2.3.
(d) The value of the Restricted Assets acquired after the
Closing Date in a transaction represents less than 30% of the consideration paid
by ▇▇▇▇▇▇▇▇ or another ▇▇▇▇▇▇▇▇ Entity in connection with such transaction, as
determined by ▇▇▇▇▇▇▇▇, in its reasonable sole discretion.
2.3 PROCEDURES. In the event that a ▇▇▇▇▇▇▇▇ Entity acquires Restricted
Assets valued or having an original cost in excess of $20 million at the time of
the acquisition, as determined by ▇▇▇▇▇▇▇▇, in its reasonable sole discretion,
then not later than six (6) months after the consummation of the acquisition by
such ▇▇▇▇▇▇▇▇ Entity of the Restricted Assets, such ▇▇▇▇▇▇▇▇
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Entity shall notify the General Partner of such purchase and offer the
Partnership Group the opportunity to purchase such Restricted Assets. As soon as
practicable, but in any event, within sixty (60) days after receipt of such
notification, the General Partner shall notify the ▇▇▇▇▇▇▇▇ Entity that either
(i) the General Partner has elected not to cause a member of the Partnership
Group to purchase such Restricted Assets, in which event such ▇▇▇▇▇▇▇▇ Entity
shall be forever free to continue to own or operate such Restricted Assets, or
(ii) the General Partner has elected to cause a member of the Partnership Group
to purchase such Restricted Assets, in which event the following procedures
shall be followed:
(a) Within thirty (30) days of receipt of the notice from the
General Partner that the General Partner has elected to cause a member of the
Partnership Group to purchase the Restricted Assets, ▇▇▇▇▇▇▇▇ shall submit an
offer to the General Partner to sell the Restricted Assets (the "▇▇▇▇▇▇▇▇
Offer") to any member of the Partnership Group selected by the General Partner
on the terms and for the consideration stated in the ▇▇▇▇▇▇▇▇ Offer;
(b) ▇▇▇▇▇▇▇▇ and the General Partner shall negotiate after
receipt of such ▇▇▇▇▇▇▇▇ Offer by the General Partner, the terms on which the
Restricted Assets will be sold to a member of the Partnership Group. ▇▇▇▇▇▇▇▇
shall provide all information concerning the business, operations and finances
of such Restricted Assets as may be reasonably requested by the General Partner.
(i) If ▇▇▇▇▇▇▇▇ and the General Partner agree on such
terms within sixty (60) days after receipt by the General Partner of
the ▇▇▇▇▇▇▇▇ Offer, the General Partner shall cause a member of the
Partnership Group to purchase the Restricted Assets on such terms as
soon as commercially practicable after such agreement has been reached;
(ii) If ▇▇▇▇▇▇▇▇ and the General Partner are unable
to agree on the terms of a sale during the 60-day period after receipt
by the General Partner of the ▇▇▇▇▇▇▇▇ Offer, ▇▇▇▇▇▇▇▇ and the General
Partner will engage an independent investment banking firm with a
national reputation to determine the fair market value of the
Restricted Assets. In determining the fair market value of the
Restricted Assets, the investment banking firm will have access to the
proposed sale and purchase values for the Restricted Assets submitted
by ▇▇▇▇▇▇▇▇ and the General Partner, respectively. Such investment
banking firm will determine the value of the Restricted Assets within
thirty (30) days and furnish ▇▇▇▇▇▇▇▇ and the General Partner its
opinion of such value. The fees of the investment banking firm's
appraisal will be split equally between ▇▇▇▇▇▇▇▇ and the MLP. Upon
receipt of such opinion, the General Partner will have the option, but
not the obligation to:
(iii)
(A) cause a member of the Partnership Group
to purchase the Restricted Assets in accordance with
the following process:
(1) if the valuation of the
investment banking firm is in the range
between the proposed sale/purchase values of
▇▇▇▇▇▇▇▇
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and the General Partner, the General Partner
will have the right to cause a member of the
Partnership Group to purchase the Restricted
Assets at the valuation submitted by the
investment banking firm;
(2) if the valuation of the
investment banking firm is less than the
proposed purchase value submitted by the
General Partner, the General Partner will
have the right to cause a member of the
Partnership Group to purchase the Restricted
Assets for the amount submitted by the
General Partner; and
(3) if the valuation of the
investment banking firm is greater than the
proposed sale value submitted by ▇▇▇▇▇▇▇▇,
the General Partner will have the right to
cause a member of the Partnership Group to
purchase the Restricted Assets for the
amount submitted by ▇▇▇▇▇▇▇▇; or
(B) decline to purchase such Restricted
Assets, in which event the ▇▇▇▇▇▇▇▇ Entity forever
will be free to continue to own and operate such
Restricted Assets.
2.4 SCOPE OF PROHIBITION. ▇▇▇▇▇▇▇▇ and any other ▇▇▇▇▇▇▇▇ Entity shall
only be required to offer Restricted Assets to the General Partner for purchase
by a member of the Partnership Group upon the terms and conditions, including
the price to paid, contained in this Article II. Except as provided in this
Article II, each ▇▇▇▇▇▇▇▇ Entity shall be free to engage in any business
activity whatsoever, including those that may be in direct competition with
Buyer or any Partnership Entity.
2.5 ENFORCEMENT. The ▇▇▇▇▇▇▇▇ Parties agree and acknowledge that the
Partnership Group does not have an adequate remedy at law for the breach of the
covenants and agreements set forth in this Article II, and that any breach of
the covenants and agreements set forth in this Article II would result in
irreparable injury to the Partnership Group. The ▇▇▇▇▇▇▇▇ Parties further agree
and acknowledge that any member of the Partnership Group (or the General Partner
acting on its behalf) may, in addition to other remedies which may be available
to the Partnership Group, file a suit in equity to enjoin any ▇▇▇▇▇▇▇▇ Entity
from such breach, and the ▇▇▇▇▇▇▇▇ Parties consent to the issuance of injunctive
relief under this Agreement.
ARTICLE III
BUYER ENTITIES' BUSINESS OPPORTUNITIES
3.1 BUYER ENTITIES RESTRICTED ASSETS. During the Applicable Period, the
Buyer Entities shall be prohibited from engaging in or acquiring any business
having assets engaged in the following activities:
(a) the transportation, storage or distribution of ammonia or
related products in the United States;
Page 8
(b) the ownership and operation of facilities for the
terminalling and storage of refined petroleum products in any state in the
United States, except Alaska and Hawaii; and
(c) Refined Product transportation (including, without
limitation, through joint tariff arrangements or capacity leases or otherwise)
to a delivery point within a 50-mile radius of a Refined Products delivery point
owned or supplied by a Partnership Entity on the Acquisition Date.
3.2 PERMITTED EXCEPTIONS. Notwithstanding any provision of Section 3.1
to the contrary, any Buyer Entity may own and operate Restricted Assets under
the following circumstances:
(a) The Restricted Asset was owned, leased or operated by the
Buyer Entities on the Closing Date.
(b) The Restricted Asset is owned, leased or operated by the
Buyer Entities on behalf of the Partnership Group.
(c) The value of the Restricted Assets acquired after the
Closing Date in a transaction does not exceed $20 million at the time of the
acquisition, as determined by Buyer, in its reasonable sole discretion.
(d) (i) The value of the Restricted Assets acquired after the
Closing Date in a transaction exceeds $20 million at the time of acquisition, as
determined by Buyer, in its reasonable sole discretion, and (ii) the General
Partner (with the approval of the Conflicts Committee) has elected not to cause
a member of the Partnership Group to pursue such opportunity in accordance with
the procedures set forth in Section 3.3.
(e) The value of the Restricted Assets acquired after the
Closing Date in a transaction represents less than 30% of the consideration paid
by Buyer or another Buyer Entity in connection with such transaction, as
determined by Buyer, in its reasonable sole discretion.
3.3 PROCEDURE. In the event that a Buyer Entity acquires Restricted
Assets valued or having an original cost in excess of $20 million at the time of
the acquisition, as determined by Buyer, in its reasonable sole discretion, then
not later than six (6) months after the consummation of the acquisition by such
Buyer Entity of the Restricted Assets, such Buyer Entity shall notify the
General Partner of such purchase and offer the Partnership Group the opportunity
to purchase such Restricted Assets. As soon as practicable, but in any event,
within sixty (60) days after receipt of such notification, the General Partner
shall notify the Buyer Entity that either (i) the General Partner has elected,
with the approval of the Conflicts Committee, not to cause a member of the
Partnership Group to purchase such Restricted Assets, in which event such Buyer
Entity shall be forever free to continue to own or operate such Restricted
Assets, or (ii) the General Partner (with the approval of the Conflicts
Committee) has elected to cause a member of the Partnership Group to purchase
such Restricted Assets, in which event the following procedures shall be
followed:
(a) Within thirty (30) days of receipt of the notice from the
General Partner that General Partner has elected to cause a member of the
Partnership Group to purchase the
Page 9
Restricted Assets, the Buyer Entity shall submit an offer to the General Partner
to sell the Restricted Assets (the "Buyer Offer") to any member of the
Partnership Group selected by the General Partner on the terms and for the
consideration stated in the Buyer Offer;
(b) The Buyer Entity and the General Partner shall negotiate
after receipt of such Buyer Offer by the General Partner, the terms on which the
Restricted Assets will be sold to a member of the Partnership Group. The Buyer
Entity shall provide all information concerning the business, operations and
finances of such Restricted Assets as may be reasonably requested by the General
Partner.
(i) If the Buyer Entity and the General Partner agree
on such terms within sixty (60) days after receipt by the General
Partner of the Buyer Offer, a member of the Partnership Group shall
purchase the Restricted Assets on such terms as soon as commercially
practicable after such agreement has been reached;
(ii) If the Buyer Entity and the General Partner are
unable to agree on the terms of a sale during the 60-day period after
receipt by the General Partner of the Buyer Offer, the Buyer Entity and
the General Partner will engage an independent investment banking firm
with a national reputation to determine the fair market value of the
Restricted Assets. In determining the fair market value of the
Restricted Assets, the investment banking firm will have access to the
proposed sale and purchase values for the Restricted Assets submitted
by the Buyer Entity and the General Partner, respectively. Such
investment banking firm will determine the value of the Restricted
Assets within thirty (30) days and furnish the Buyer Entity and the
General Partner its opinion of such value. The fees of the investment
banking firm's appraisal will be split equally between the Buyer Entity
and the MLP. Upon receipt of such opinion, the General Partner will
have the option, but not the obligation to:
(iii)
(A) cause a member of the Partnership Group
to purchase the Restricted Assets in accordance with
the following process:
(1) if the valuation of the
investment banking firm is in the range
between the proposed sale/purchase values of
the Buyer Entity and the General Partner, a
member of the Partnership Group will have
the right to purchase the Restricted Assets
at the valuation submitted by the investment
banking firm;
(2) if the valuation of the
investment banking firm is less than the
proposed purchase value submitted by the
General Partner, a member of the Partnership
Group will have the right to purchase the
Restricted Assets for the amount submitted
by the General Partner; and
(3) if the valuation of the
investment banking firm is greater than the
proposed sale value submitted by the Buyer
Entity, a member of the Partnership Group
will have the right to purchase
Page 10
the Restricted Assets for the amount
submitted by the Buyer Entity; or
(B) decline to purchase such Restricted
Assets, in which event the Buyer Entity forever will
be free to continue to own and operate such
Restricted Assets.
3.4 SCOPE OF PROHIBITION. Except as provided in this Article III, each
Buyer Entity shall be free to engage in any business activity whatsoever,
including those that may be in direct competition with any member of the
Partnership Group.
3.5 ENFORCEMENT. Buyer agrees and acknowledges that the Partnership
Group does not have an adequate remedy at law for the breach of the covenants
and agreements set forth in this Article III, and that any breach of the
covenants and agreements set forth in this Article III would result in
irreparable injury to the Partnership Group. Buyer further agrees and
acknowledges that any member of the Partnership Group (or the General Partner
acting on its behalf) may, in addition to the other remedies which may be
available to the Partnership Group, file a suit in equity to enjoin any Buyer
Entity from such breach, and Buyer consents to the issuance of injunctive relief
under this Agreement.
ARTICLE IV
ENVIRONMENTAL INDEMNIFICATION
4.1 ▇▇▇ INDEMNIFICATION FOR COVERED ENVIRONMENTAL LOSSES. ▇▇▇▇▇▇▇▇ and
▇▇▇, jointly and severally, shall indemnify, defend and hold harmless the
Partnership Entities from and against any Covered Environmental Losses relating
to the assets of the Partnership Entities described in the Prospectus that arose
prior to the IPO Date (the "IPO Assets") that become known by February 9, 2004
and that exceed all amounts recovered or recoverable by any Partnership Entity
under contractual indemnities from third Persons or under any applicable
insurance policies. "Covered Environmental Losses" mean those non-contingent
environmental losses, costs, damages and expenses suffered or incurred by the
Partnership Entities arising from correction of violations of, or performance of
remediation required by, Environmental Laws in effect at the IPO Date due to
events and conditions associated with the operation of the IPO Assets and
occurring before the IPO Date.
4.2 LIMITATIONS. ▇▇▇▇▇▇▇▇ and ▇▇▇ shall have no indemnification
obligation under Section 4.1 for claims made after February 9, 2004. The
aggregate liability of ▇▇▇▇▇▇▇▇ and ▇▇▇ in respect of all Covered Environmental
Losses under Section 4.1 shall not exceed $13.3 million, representing $15
million less any amounts previously paid by ▇▇▇▇▇▇▇▇ or ▇▇▇ to the Partnership
Entities pursuant to Section 3.1 of the Old Omnibus Agreement, which amounts are
set forth on Schedule 4.2 hereto.
ARTICLE V
RIGHT-OF-WAY INDEMNIFICATION
5.1 WNGL RIGHT-OF-WAY INDEMNIFICATION. ▇▇▇▇▇▇▇▇ and WNGL, jointly and
severally, shall indemnify, defend and hold harmless the Partnership Entities
and their successors or assigns until February 9, 2016 from and against any
losses, costs, damages, expenses and fees
Page 11
suffered or incurred by any of the Partnership Entities or their successors or
assigns as a result of (a) the failure of ▇▇▇▇▇▇▇▇ Ammonia Pipeline, L.P., a
Delaware limited partnership ("WAP LP"), or its successors or assigns to be the
owner of such valid and indefeasible easement rights in and to the easements and
rights of way in which the ammonia pipeline was located as of the IPO Date and
as are necessary to enable WAP LP and its successors and assigns to continue to
own and operate the ammonia pipeline in the manner that it was owned and
operated as of the IPO Date; and (b) the failure of WAP LP or its successors and
assigns to have the consents and permits necessary to allow such pipeline to
cross the roads, waterways, railroads and other areas upon which the ammonia
pipeline was located as of the IPO Date.
5.2 ▇▇▇ RIGHT-OF-WAY INDEMNIFICATION. ▇▇▇▇▇▇▇▇ and ▇▇▇, jointly and
severally, shall indemnify, defend and hold harmless, the Partnership Entities
and their successors and assigns, until February 9, 2016, from and against any
losses, costs, damages, expenses and fees suffered or incurred by any of the
Partnership Entities or their successors or assigns as a result of (a) the
failure of ▇▇▇▇▇▇▇▇ Terminals Holdings, L.P. , a Delaware limited partnership
("WTH LP"), or its successors and assigns to be the owner of valid and
indefeasible easement rights in and to the easements and rights of way in which
the pipelines that are associated with the marine terminal facilities at Galena
Park, Texas, Corpus Christi, Texas and Marrero, Louisiana were located as of the
IPO Date and that are necessary to enable WTH LP and its successors and assigns
to continue to own and operate the pipelines in all material respects in the
manner that such pipelines were owned and operated prior to the IPO Date; and
(b) the failure of WTH LP or its successors and assigns to have the consents and
permits necessary to allow such pipelines to cross roads, waterways, railroads
and other areas upon which such pipelines were located as of the IPO Date.
ARTICLE VI
ENVIRONMENTAL AND RIGHT-OF-WAY INDEMNIFICATION PROCEDURES
6.1 (a) Buyer agrees that within a reasonable period of time after any
Partnership Entity becomes aware of facts giving rise to a claim for
indemnification pursuant to Sections 4.1, 5.1 or 5.2, Buyer will use its
reasonable best efforts to cause such Partnership Entity to provide notice
thereof in writing to ▇▇▇▇▇▇▇▇, specifying the nature of and specific basis for
such claim.
(b) Except as provided in this Section 6.1(b), ▇▇▇▇▇▇▇▇ shall
have the right to control all aspects of the defense of (and any counterclaims
with respect to) any claims brought against the Partnership Entities that are
covered by the indemnification set forth in Sections 4.1, 5.1 or 5.2, including,
without limitation, the selection of counsel, determination of whether to appeal
any decision of any court and the settling of any such matter or any issues
relating thereto; provided, however, that no such settlement shall be entered
into without the consent of the Partnership Entities unless it includes a full
and unconditional release of the Partnership Entities from all liability with
respect to such matter or issues, as the case may be, the sole relief provided
is monetary damages that are paid in full by the ▇▇▇▇▇▇▇▇ Parties, and there is
no admission or statement of fault or culpability on the part of any Partnership
Entity.
(c) Buyer agrees to use its reasonable best efforts to cause
the Partnership Entities, at their own cost and expense, to cooperate fully with
▇▇▇▇▇▇▇▇ with respect to all aspects of the defense of any claims covered by the
indemnification set forth in Sections 4.1, 5.1
Page 12
or 5.2, including, without limitation, the prompt furnishing to ▇▇▇▇▇▇▇▇ of any
correspondence or other notice relating thereto that the Partnership Entities
may receive, permitting the names of the Partnership Entities to be utilized in
connection with such defense, the making available to ▇▇▇▇▇▇▇▇ of any files,
records or other information of the Partnership Entities that ▇▇▇▇▇▇▇▇
reasonably considers relevant to such defense and the making reasonably
available to ▇▇▇▇▇▇▇▇, during normal business hours, of any employees of the
Partnership Entities; provided, however, that in connection therewith ▇▇▇▇▇▇▇▇
agrees to use reasonable best efforts to minimize the impact thereof on the
operations of such Partnership Entities. In no event shall the obligation of
Buyer to use its reasonable best efforts to cause the Partnership Entities to
cooperate with ▇▇▇▇▇▇▇▇ as set forth in the immediately preceding sentence be
construed as imposing upon the Buyer or the Partnership Entities an obligation
to hire and pay for counsel in connection with the defense of any claims covered
by the indemnification set forth in this Article VI, it being agreed that the
▇▇▇▇▇▇▇▇ Parties, jointly and severally, shall pay the fees and expenses of such
counsel; provided, further, that Buyer or the Partnership Entities may hire and
pay for separate counsel in connection with any such defense, at the Buyers or
the Partnership's own option, cost and expense, as the case may be; provided,
further, that the ▇▇▇▇▇▇▇▇ Parties, jointly and severally, shall pay the fees
and expenses of separate counsel for the Buyer or the Partnership Entities if
(i) the ▇▇▇▇▇▇▇▇ Parties have agreed to pay such fees and expenses or (ii)
counsel for the ▇▇▇▇▇▇▇▇ Parties reasonably determines that representation of
both the ▇▇▇▇▇▇▇▇ Parties, on the one hand, and the Partnership Entities, on the
other hand, by the same counsel would create a conflict of interest. ▇▇▇▇▇▇▇▇
agrees to keep any counsel hired by the Partnership Entities reasonably informed
as to the status of any such defense, but ▇▇▇▇▇▇▇▇ shall have the right to
retain sole control over such defense except as provided above.
(d) In determining the amount of any loss, cost, damage or
expense for which any of the Partnership Entities are to be indemnified under
Sections 4.1, 5.1 or 5.2, the gross amount of the indemnification will be
reduced by (i) any insurance proceeds realized or to be realized by the
Partnership Entities, and such correlative insurance benefit shall be net of any
incremental insurance premium that becomes due and payable by the Partnership
Entities as a result of such claim and (ii) all amounts recovered or recoverable
by any Partnership Entity under contractual indemnities from third Persons as
described in Section 4.1.
ARTICLE VII
GENERAL AND ADMINISTRATIVE EXPENSES
7.1 G&A CAP AMOUNT.
(a) Subject to Section 7.2, the amount of general and
administrative expenses reimbursed by the Partnership Group to the Buyer
Entities (or, in the case of Section 7.1(b)(i)(A) below, to the ▇▇▇▇▇▇▇▇
Entities) for any MLP fiscal year shall not exceed the amounts calculated
pursuant to Section 7.1(b) (for any MLP fiscal year, the "G&A Cap Amount").
(b) (i) 2003 Fiscal Year. For the MLP fiscal year ending on
December 31, 2003, the G&A Cap Amount shall be calculated as follows:
(A) For the period beginning on January 1,
2003 and ending on the day immediately preceding the
Closing Date (the "2003 Pre-Closing
Page 13
Stub Period"), the amount of general and
administrative expenses reimbursed by the Partnership
Group to the ▇▇▇▇▇▇▇▇ Entities shall not exceed $37.9
million times a fraction, (X) the numerator of which
is the number of successive whole months beginning
with January 2003 and ending with the month in which
the Closing occurs and (Y) the denominator of which
is twelve (12) (the "2003 Pre-Closing Cap"). To the
extent that the Partnership Group reimbursed the
▇▇▇▇▇▇▇▇ Entities for general and administrative
expenses incurred in 2003 in excess of the 2003
Pre-Closing Cap, the ▇▇▇▇▇▇▇▇ Parties shall reimburse
the MLP for any such excess amounts and shall make
such payment no later than thirty (30) days following
the Closing Date. To the extent that the ▇▇▇▇▇▇▇▇
Entities paid unreimbursed general and administrative
expenses up to the 2003 Pre-Closing Cap, Buyer shall
use commercially reasonable efforts to cause the MLP
to, make payment to the appropriate ▇▇▇▇▇▇▇▇ Entity
of such unreimbursed amount no later than thirty (30)
days following the Closing Date.
(B) For the period beginning with the
Closing Date and ending on December 31, 2003 (the
"2003 Post-Closing Stub Period"), the amount of
general and administrative expenses reimbursed by the
Partnership Group to the Buyer Entities shall not
exceed the sum of (1) the product of $37.9 million
(as may be adjusted pursuant to Section 7.1(b)(iii))
times a fraction, (X) the numerator of which is the
number of successive whole months beginning with the
month following the month in which the Closing occurs
and ending with December 2003 and (Y) the denominator
of which is twelve (12) (the "2003 Post-Closing
Cap"), plus (2) the amount of general and
administrative expenses incurred by or on behalf of
the Partnership Group in excess of the 2003
Post-Closing Upper Cap Amount less any amounts duly
reimbursed by the ▇▇▇▇▇▇▇▇ Parties to the Buyer
Entities pursuant to Section 7.2(c)(iii)(A).
(ii) Succeeding Fiscal Years. For each succeeding MLP
fiscal year beginning with the MLP fiscal year ending December 31,
2004, the G&A Cap Amount shall be calculated as follows:
(A) The G&A Cap Amount from the preceding
fiscal year (as may be adjusted pursuant to Section
7.1(b)(iii)) shall be increased by the greater of (A)
7% per year and (B) the percentage increase in the
Consumer Price Index - All Urban Consumers, U.S. City
Average, Not Seasonally Adjusted.
(B) For purposes of calculating the initial
increase in the G&A Cap Amount for the MLP fiscal
year ending on December 31, 2004, the G&A Cap Amount
for the 2003 fiscal year shall be $37.9 million (as
may be adjusted pursuant to Section 7.1(b)(iii) for
acquisitions, construction, capital improvements,
replacements or expansions occurring in 2003).
Page 14
(iii) Adjustment for Acquisitions and Other Events.
If, after the Closing Date, the Partnership Group (A) makes an
acquisition, (B) constructs or causes to be constructed any assets to
be owned, leased or operated by any member of the Partnership Group or
(C) makes or causes to be made any capital improvements, replacements
or expansions of any assets owned, leased or operated by any member of
the Partnership Group, the amount of general and administrative
expenses reimbursed by the Partnership Group to the Buyer Entities will
be increased by the Buyer's good faith reasonable estimate of the
additional amount of annual general and administrative expenses to be
incurred by or on behalf of the Partnership Group with respect to such
acquisition, construction, capital improvement, replacement or
expansion. The appropriate portion of the additional general and
administrative expenses shall be added to the G&A Cap Amount and the
Upper Cap Amount in the year in which such acquisition, construction,
capital improvement, replacement or expansion occurs and the full
amount of such general and administrative expenses shall be added to
the G&A Cap Amount and the Upper Cap Amount thereafter.
7.2 CERTAIN LIMITATIONS. The provisions of Section 7.1 shall be subject
to the following limitations:
(a) Expiration of G&A Cap. The amount of general and
administrative expenses reimbursed by the Partnership Group to the Buyer
Entities shall not be limited under this Agreement with respect to any fiscal
year ending after December 31, 2010.
(b) Certain Expenses Not Included. General and administrative
expenses with respect to the following matters shall be excluded in determining
limitations herein on the amount of general and administrative expenses that are
required to be reimbursed by the Partnership Group or the ▇▇▇▇▇▇▇▇ Parties to
the Buyer Entities:
(i) expenses associated with equity-based incentive
compensation plans; or
(ii) general and administrative expenses incurred by
Buyer that are covered under Section 4.15 to the Purchase Agreement,
regardless of whether in excess of the Expense Limit (as defined in
Section 4.15 to the Purchase Agreement), it being understood that to
the extent the ▇▇▇▇▇▇▇▇ Parties reimburse Buyer for general and
administrative expenses in excess of the Expense Limit, Buyer shall
promptly pay any such reimbursements to the MLP by wire transfer of
immediately available funds to an account or accounts designated in
writing by the MLP.
(c) Upper Cap Amount.
(i) Notwithstanding the limitations in Section 7.1 on
the Partnership Group's reimbursement obligations for general and
administrative expenses in excess of the G&A Cap Amount, the
Partnership Group (or in the case of Section 7.2(c)(iii), the ▇▇▇▇▇▇▇▇
Parties) shall be required to reimburse the Buyer Entities for general
and administrative expenses incurred on behalf of the Partnership Group
in any MLP fiscal year in excess of the Upper Cap Amount as calculated
below (the "Upper Cap Amount").
Page 15
(ii) The Upper Cap Amount shall be calculated as
follows:
(A) For the 2003 Post-Closing Stub Period,
the Upper Cap Amount shall be equal to the product of
[$49.3 million] (as may be adjusted pursuant to
Section 7.1(b)(iii)) times a fraction, (X) the
numerator of which is the number of successive whole
months beginning with the month following the month
in which the Closing occurs and ending with month of
December 2003 and (Y) the denominator of which is
twelve (12) (the "2003 Post-Closing Upper Cap
Amount").
(B) For each succeeding MLP fiscal year
beginning with the MLP fiscal year ending December
31, 2004, the Upper Cap Amount shall be calculated as
follows:
(1) The Upper Cap Amount from the
preceding fiscal year (as may be adjusted
pursuant to Section 7.1(b)(iii)) shall be
increased annually by the lesser of (A) 2.5%
per year and (B) the percentage increase in
the Consumer Price Index - All Urban
Consumers, U.S. City Average, Not Seasonally
Adjusted.
(2) For purposes of calculating the
initial increase in the Upper Cap Amount for
the MLP fiscal year ending on December 31,
2004, the Upper Cap Amount for the 2003
fiscal year shall be [$49.3 million] (as may
be adjusted pursuant to Section 7.1(b)(iii)
for acquisitions, construction, capital
improvements, replacements and expansions
occurring in 2003).
(iii) For the twelve months immediately following the
Closing Date, the ▇▇▇▇▇▇▇▇ Parties shall be required to reimburse the
Buyer Entities for any and all general and administrative expenses
incurred by or on behalf of the Partnership Group in excess of the
Upper Cap Amount, as follows:
(A) If, during the 2003 Post-Closing Stub
Period, the general and administrative expenses
incurred by or on behalf of the Partnership Group are
in an amount in excess of 2003 Post-Closing Upper Cap
Amount, the ▇▇▇▇▇▇▇▇ Parties, jointly and severally,
shall be required to reimburse the Buyer Entities in
full for the amount of such excess and shall make
such payment no later than thirty (30) days after the
last day of the 2003 Post-Closing Stub Period by wire
transfer of immediately available funds to an account
or accounts designated in writing by the Buyer
Entities.
(B) If, during the period beginning on
January 1, 2004 and ending on the last day of the
month in which the first anniversary of the Closing
Date occurs (the "2004 Stub Period"), the general and
administrative expenses incurred by or on behalf of
the Partnership Group exceed the Upper Cap Amount for
the MLP fiscal year ended December
Page 16
31, 2004 multiplied by a fraction, (X) the numerator
of which is the number of successive months beginning
with January 2004 and ending with the month in which
the 2004 Stub Period ends and (Y) the denominator of
which is twelve (12) (the "2004 Stub Period Upper Cap
Amount"), the ▇▇▇▇▇▇▇▇ Parties, jointly and
severally, shall be required to reimburse the Buyer
Entities in full for the amount of such excess and
shall make such payment no later than thirty (30)
days after the last day of the 2004 Stub Period by
wire transfer of immediately available funds to an
account or accounts designated in writing by the
Buyer Entities. If Buyer becomes obligated to pay the
5% premium for transition services pursuant to the
final proviso in Section 4(a) of the Transition
Services Agreement, then for purposes of the
immediately preceding sentence, the 2004 Stub Period
Upper Cap Amount shall be increased by the portion of
such premium constituting general and administrative
expenses of the Partnership Group attributable to the
2004 Stub Period.
(C) Buyer shall, and shall cause each of the
other Buyer Entities to, use good faith efforts to
minimize the amount of general and administrative
expenses incurred by any of the Buyer Entities and
for which the ▇▇▇▇▇▇▇▇ Parties would be required to
reimburse the Buyer Entities under this Section
7.2(c)(iii).
(D) Notwithstanding any other provision of
this Article VII, the ▇▇▇▇▇▇▇▇ Entities will not have
any obligations to reimburse the Buyer Entities for
general and administrative expenses incurred on
behalf of the Partnership Group or otherwise, except
as specifically provided in this Section 7.2(c)(iii).
(iv) Except as provided in Section 7.2(c)(iii), the
Partnership Group shall be required to reimburse the Buyer Entities for
any and all general and administrative expenses in excess of the Upper
Cap Amount incurred by or on behalf of the Partnership Group in any MLP
fiscal year.
7.3 NO AFFECT ON SECTION 7.4 OF THE MLP AGREEMENT. Nothing in this
Article VII is intended or shall be construed to affect or modify the terms and
conditions of Section 7.4 of the MLP Agreement.
ARTICLE VIII
CAPITAL EXPENDITURES
8.1 ▇▇▇▇▇▇▇▇ REIMBURSEMENT OF PARTNERSHIP GROUP MAINTENANCE CAPITAL
EXPENDITURES. The ▇▇▇▇▇▇▇▇ Entities will reimburse the Partnership Group in each
of the MLP's 2003 and 2004 fiscal years for any reasonable and customary
maintenance capital expenditures made by the Partnership Group, in accordance
with past practices, to maintain the assets of WPL, in either year, in excess of
$19 million; provided, that the ▇▇▇▇▇▇▇▇ Entities shall not be required to
reimburse the Partnership Group in excess of an aggregate amount of $15 million
under this
Page 17
Section 8.1, less any sums previously paid by any ▇▇▇▇▇▇▇▇ Entity to the
Partnership Group pursuant to Section 6.1(b) of the Old Omnibus Agreement and
set forth on Schedule 8.1.
ARTICLE IX
MISCELLANEOUS
9.1 PAYMENTS; DISPUTED AMOUNTS; AUDIT RIGHTS.
(a) Except as otherwise provided herein, any payments to be
made by the ▇▇▇▇▇▇▇▇ Entities to Buyer or the Partnership Entities under this
Agreement shall be made by the ▇▇▇▇▇▇▇▇ Entities within sixty (60) days of
receipt of a written request for such payment from Buyer (which request shall
contain a description in reasonable detail of the individual costs and expenses
that comprise the aggregate amount of the payment requested) (a "Payment
Request"). In the event of a good faith dispute as to the amount of such
payment, the applicable ▇▇▇▇▇▇▇▇ Entity shall give written notice of such
dispute on or before the due date with respect to all or any portion of the
Payment Request, with the particulars of such dispute. Upon receipt of such
notice, Buyer shall, or shall use its reasonable best efforts to cause the
Partnership Entities to, furnish to the applicable ▇▇▇▇▇▇▇▇ Entity additional
supporting documentation to reasonably substantiate the amount of the Payment
Request. Upon delivery of such additional documentation, the applicable ▇▇▇▇▇▇▇▇
Entity and the Buyer Entities shall cooperate and use their reasonable best
efforts to resolve such dispute. If they are unable to resolve their dispute
within twenty (20) business days of the delivery of such additional supporting
documentation to the applicable ▇▇▇▇▇▇▇▇ Entity, then the dispute shall be
referred for resolution by a firm of independent accountants of nationally
recognized standing reasonably satisfactory to each of Buyer and the applicable
▇▇▇▇▇▇▇▇ Entity (the "Accounting Referee"), which shall determine the disputed
amounts within thirty (30) days of the referral of such dispute to such
Accounting Referee. The determination of the Accounting Referee shall not
require the applicable ▇▇▇▇▇▇▇▇ Entity to pay more than the amount in dispute
nor require Buyer or any Partnership Entity to return any amount previously paid
by the applicable ▇▇▇▇▇▇▇▇ Entity. The fees and expenses of the Accounting
Referee shall be borne equally by the applicable ▇▇▇▇▇▇▇▇ Entity, on the one
hand, and Buyer or a member of the Partnership Entities, on the other hand. The
determination of the Accounting Referee shall be finally binding. If any dispute
is resolved in favor of Buyer or any Partnership Entity, the applicable ▇▇▇▇▇▇▇▇
Entity shall make payment to Buyer or the applicable Partnership Entity within
thirty (30) days of resolution of the dispute. Notwithstanding the foregoing, in
no event shall the ▇▇▇▇▇▇▇▇ Entities be entitled to withhold any amounts other
than those portions of the applicable payment that are in dispute.
(b) ▇▇▇▇▇▇▇▇ shall have the right, at any time within six (6)
months after the date of any payment by ▇▇▇▇▇▇▇▇ to Buyer or the Partnership
Entities pursuant to a Payment Request to audit those books and records of Buyer
and/or any Partnership Entity that incurred costs or expenses attributable to
such Payment Request or which books and records relate thereto, to verify the
amount reflected on such Payment Request. Any such audit shall be conducted
during normal business hours by ▇▇▇▇▇▇▇▇ or its designated auditor after ten
(10) days prior written notice to Buyer, at ▇▇▇▇▇▇▇▇' sole cost and expense, in
the offices of Buyer and the relevant Partnership Entities or such other
location as may be mutually agreed. Buyer shall cooperate and shall use its
reasonable best efforts to cause any relevant Partnership Entity to cooperate
with and provide reasonable assistance to ▇▇▇▇▇▇▇▇ and/or its auditor in
connection
Page 18
with the performance of any such audit. ▇▇▇▇▇▇▇▇ shall assert any claim for
refund of amounts reimbursed to Buyer or the Partnership Entities under the
audited Payment Request within sixty (60) days after the completion of the
audit. Buyer shall have sixty (60) days from receipt of ▇▇▇▇▇▇▇▇' claim for
refund to respond. If Buyer does not dispute ▇▇▇▇▇▇▇▇' refund claim, Buyer or
the applicable Partnership Entity shall pay such refund within such 60-day
period. Should Buyer dispute the claim and refuse to pay any refund claim by
▇▇▇▇▇▇▇▇ resulting from the exercise of ▇▇▇▇▇▇▇▇' audit rights, the parties will
refer the dispute to an Accounting Referee in the manner described in Section
9.1(a) above.
9.2 THIRD-PARTY BENEFICIARY; ASSIGNMENT; ENFORCEMENT.
(a) Each of Buyer and the ▇▇▇▇▇▇▇▇ Parties specifically
intends that each entity comprising the Partnership Entities or the Partnership
Group, as applicable, shall be entitled to assert rights and remedies hereunder
as third-party beneficiaries hereto with respect to those provisions of this
Agreement affording a right, benefit or privilege to any such entity.
(b) No party shall have the right to assign its rights or
obligations under this Agreement without the consent of the other parties
hereto.
(c) The parties hereto agree that irreparable damage would
occur if any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof, this being in addition to any other remedy to
which they are entitled at law or in equity. The third-party beneficiaries to
whom certain rights and remedies under this Agreement extend as contemplated
under Section 9.2(a) above shall also be entitled to enforce this Agreement in
the manner provided in this Section 9.2(c). Notwithstanding anything else in
this Agreement, the provisions of this Agreement are enforceable solely by the
parties to this Agreement and the third-party beneficiaries identified in
Section 9.2(a) above, and no Limited Partner, Assignee or other Person (other
than a permitted assignee under Section 9.2(b)) may enforce any provision of
this Agreement or compel any party to this Agreement to comply with the terms of
this Agreement.
9.3 CHOICE OF LAW; SUBMISSION TO JURISDICTION. This Agreement shall be
subject to and governed by the laws of the State of New York, excluding any
conflicts-of-law rule or principle that might refer the construction or
interpretation of this Agreement to the laws of another state. Each party hereby
submits to the jurisdiction of the state and federal courts in the State of New
York and to venue in the Borough of Manhattan in the City of New York, New York.
9.4 NOTICE. All notices or requests or consents provided for or
permitted to be given pursuant to this Agreement must be in writing and must be
given by depositing same in the United States mail, addressed to the Person to
be notified, postpaid, and registered or certified with return receipt requested
or by delivering such notice in person or by telecopier or telegram to such
party. Notice given by personal delivery or mail shall be effective upon actual
receipt. Notice given by telegram or telecopier shall be effective upon actual
receipt if received during the recipient's normal business hours, or at the
beginning of the recipient's next business day
Page 19
after receipt if not received during the recipient's normal business hours. All
notices to be sent to a party pursuant to this Agreement shall be sent to or
made at the address set forth below such party's signature to this Agreement, or
at such other address as such party may stipulate to the other parties in the
manner provided in this Section 9.4.
9.5 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the parties relating to the matters contained herein, superseding all prior
contracts or agreements, whether oral or written, relating to the matters
contained herein.
9.6 TERMINATION OF CERTAIN OBLIGATIONS UPON CHANGE OF CONTROL.
(a) Upon a Change of Control of ▇▇▇▇▇▇▇▇, the obligations of
the ▇▇▇▇▇▇▇▇ Entities under Article II shall terminate.
(b) Upon a Change of Control of Buyer or WEG GP LLC, the
obligations of the Buyer Entities under Article III shall terminate.
(c) Upon a Change of Control of Buyer or WEG GP LLC, the
obligations of the ▇▇▇▇▇▇▇▇ Parties under Article V shall terminate as of the
later to occur of (A) the date of such Change of Control and (B) the expiration
of all of the obligations of ▇▇▇ pursuant to Sections 10.1(a) (with respect to
breaches of environmental representations, warranties, agreements or covenants),
10.1(b) and 10.1(c) of that certain Contribution Agreement dated as of April 11,
2002 by and among ▇▇▇, the Old GP and the MLP and the expiration of all of the
corresponding obligations of ▇▇▇▇▇▇▇▇ pursuant to that certain Corporate
Guarantee in favor of the General Partner, dated as of March 14, 2003, of
▇▇▇▇▇▇▇▇.
(d) Upon a Change of Control of Buyer or WEG GP LLC, Article
VII and the limitations therein on the amount of general and administrative
expenses for which the Partnership Group is required to reimburse the Buyer
Entities shall terminate (including the provisions therein relating to the
reimbursement obligations of the ▇▇▇▇▇▇▇▇ Parties in favor of the Buyer
Entities).
9.7 EFFECT OF WAIVER OR CONSENT. No waiver or consent, express or
implied, by any party to or of any breach or default by any Person in the
performance by such Person of its obligations hereunder shall be deemed or
construed to be a consent or waiver to or of any other breach or default in the
performance by such Person of the same or any other obligations of such Person
hereunder. Failure on the part of a party to complain of any act of any Person
or to declare any Person in default, irrespective of how long such failure
continues, shall not constitute a waiver by such party of its rights hereunder
until the applicable statute of limitations period has run.
9.8 AMENDMENT OR MODIFICATION. This Agreement may be amended or
modified from time to time only by the written agreement of all the parties
hereto. Each such instrument shall be reduced to writing and shall be designated
on its face an "Amendment" or an "Addendum" to this Agreement.
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9.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if all signatory parties had signed the
same document. All counterparts shall be construed together and shall constitute
one and the same instrument.
9.10 SEVERABILITY. If any provision of this Agreement or the
application thereof to any Person or circumstance shall be held invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such provision to other Persons or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.
9.11 GENDER, PARTS, ARTICLES AND SECTIONS. Whenever the context
requires, the gender of all words used in this Agreement shall include the
masculine, feminine and neuter, and the number of all words shall include the
singular and plural. Unless otherwise provided, all references to Article
numbers and Section numbers refer to Articles and Sections of this Agreement.
9.12 FURTHER ASSURANCES. In connection with this Agreement and all
transactions contemplated by this Agreement, each signatory party hereto agrees
to execute and deliver such additional documents and instruments and to perform
such additional acts as may be necessary or appropriate to effectuate, carry out
and perform all of the terms, provisions and conditions of this Agreement and
all such transactions.
9.13 WITHHOLDING OR GRANTING OF CONSENT. Each party may, with respect
to any consent or approval that it is entitled to grant pursuant to this
Agreement, grant or withhold such consent or approval in its sole and
uncontrolled discretion, with or without cause, and subject to such conditions
as it shall deem appropriate.
9.14 U.S. CURRENCY. All sums and amounts payable to or to be payable
pursuant to the provisions of this Agreement shall be payable in coin or
currency of the United States of America that, at the time of payment, is legal
tender for the payment of public and private debts in the United States of
America.
9.15 LAWS AND REGULATION. Notwithstanding any provision of this
Agreement to the contrary, no party to this Agreement shall be required to take
any act, or fail to take any act, under this Agreement if the effect thereof
would be to cause such party to be in violation of any applicable law, statute,
rule or regulation.
9.16 WAIVER OF RIGHT OF FIRST REFUSAL. The ▇▇▇▇▇▇▇▇ Parties hereby
agree that, effective as of the date hereof, any and all rights, benefits and
privileges of ▇▇▇ and any other ▇▇▇▇▇▇▇▇ Entity under Section 11.10 of that
certain Contribution Agreement dated as of April 11, 2002 by and among ▇▇▇, the
Old GP and the MLP are hereby forever terminated in all respects, and ▇▇▇, WNGL
and ▇▇▇▇▇▇▇▇ hereby waive any and all rights, benefits and privileges of ▇▇▇ and
any other ▇▇▇▇▇▇▇▇ Entity under such section of such agreement.
[Signature Pages to Follow]
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IN WITNESS WHEREOF, the parties have executed this Agreement on, and
effective as of, the date first written above.
THE BUYER
WEG ACQUISITIONS, L.P.
By: WEG Acquisition Management, LLC
its General Partner
By:
---------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile:
Attention:
THE SELLING PARTIES
▇▇▇▇▇▇▇▇ ENERGY SERVICES, LLC
By:
----------------------------------------
Name:
Title:
▇▇▇▇▇▇▇▇ ENERGY SERVICES, LLC
By:
----------------------------------------
Name:
Title:
THE ▇▇▇▇▇▇▇▇ COMPANIES, INC.
By:
----------------------------------------
Name:
Title:
Address for Notice:
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile:
Attention:
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SCHEDULES
SCHEDULE 4.2
Aggregate amount of environmental indemnity payments previously paid by ▇▇▇ to
the Partnership Entities pursuant to Section 3.1 of the Old Omnibus Agreement.
SCHEDULE 8.1
Aggregate amount of prior reimbursement payments made by any of the ▇▇▇▇▇▇▇▇
Entities for maintenance capital expenditure pursuant to Section 6.1(b) of the
Old Omnibus Agreement.
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