V&E Draft 4/22/04
EXHIBIT 10.4
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OMNIBUS AGREEMENT
among
XXXXX CORPORATION
NAVAJO PIPELINE CO., L.P.
HOLLY LOGISTIC SERVICES, L.L.C.
HEP LOGISTICS HOLDINGS, L.P.
HOLLY ENERGY PARTNERS, L.P.
HEP LOGISTICS GP, L.L.C.
and
HEP OPERATING COMPANY, L.P.
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OMNIBUS AGREEMENT
THIS OMNIBUS AGREEMENT ("Agreement") is entered into on, and effective
as of, the Closing Date (as defined herein) among Xxxxx Corporation, a Delaware
corporation ("Xxxxx"), Navajo Pipeline Co., L.P., a Delaware limited partnership
("Navajo Pipeline"), Xxxxx Logistic Services, L.L.C., a Delaware limited
liability company ("Xxxxx GP"), HEP Logistics Holdings, L.P., a Delaware limited
partnership (the "General Partner"), Xxxxx Energy Partners, L.P., a Delaware
limited partnership (the "Partnership"), HEP Logistics GP, L.L.C., a Delaware
limited liability company ("Xxxxx GP LLC"), and Xxxxx Operating Company, L.P., a
Delaware limited partnership (the "Operating Partnership"). The above-named
entities are sometimes referred to in this Agreement each as a "Party" and
collectively as the "Parties."
RECITALS:
1. The Parties desire by their execution of this Agreement to evidence
their understanding, as more fully set forth in Article II, with respect to
those business opportunities that the Xxxxx Entities (as defined herein) will
not engage in during the term of this Agreement unless the Partnership has
declined to engage in any such business opportunity for its own account.
2. The Parties desire by their execution of this Agreement to evidence
their understanding, as more fully set forth in Article III, with respect to
certain indemnification obligations of the Parties to each other.
3. The Parties desire by their execution of this Agreement to evidence
their understanding, as more fully set forth in Article IV, with respect to the
amount to be paid by the Partnership for the general and administrative services
to be performed by the General Partner and its Affiliates (as defined herein)
for and on behalf of the Partnership Group (as defined herein).
4. The Parties desire by their execution of this Agreement to evidence
their understanding, as more fully set forth in Article V, with respect to the
Partnership Group's option to purchase the Option Assets (as defined herein).
5. The Parties desire by their execution of this Agreement to evidence
their understanding, as more fully set forth in Article VI, with respect to
Holly's right of first refusal relating to the Assets (as defined herein).
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) As used in this Agreement, the following terms
shall have the respective meanings set forth below:
"Acquisition Proposal" is defined in Section 6.2(a).
"Administrative Fee" is defined in Section 4.1(a).
"Affiliate" is defined in the Partnership Agreement.
"Assets" means all assets conveyed, contributed, or otherwise
transferred by the Xxxxx Entities to the Partnership Group prior to or
on the Closing Date and any assets acquired by the Partnership Group
pursuant to the exercise of the purchase option granted under Article
V.
"Change of Control" means, with respect to any Person (the
"Applicable Person"), any of the following events: (a) 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; (b) 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 (i) the
outstanding Voting Securities of the Applicable Person are changed into
or exchanged for Voting Securities of the surviving Person or its
parent and (ii) 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 Person or its parent immediately after such transaction; and
(c) a "person" or "group" (within the meaning of Sections 13(d) or
14(d)(2) of the Exchange Act) (in the case of Xxxxx, other than a group
consisting of some of all of the current control persons of Xxxxx),
being or becoming the "beneficial owner" (as defined in Rules 13d-3 and
13d-5 under the Exchange Act) of more than 50% of all of the then
outstanding Voting Securities of the Applicable Person, except in a
merger or consolidation that would not constitute a Change of Control
under clause (b) above.
"Closing Date" means the date of the closing of the
Partnership's initial public offering of Common Units.
"Common Units" is defined in the Partnership Agreement.
"Conflicts Committee" is defined in the Partnership Agreement.
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"Contribution Agreement" means that certain Contribution,
Conveyance and Assumption Agreement, dated as of the Closing Date,
among Xxxxx, Navajo Pipeline, Xxxxx GP, the General Partner, the
Partnership, Xxxxx GP LLC, the Operating Partnership and certain other
parties, together with the additional conveyance documents and
instruments contemplated or referenced thereunder.
"control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies
of a Person, whether through ownership of voting securities, by
contract, or otherwise.
"Covered Environmental Losses" is defined in Section 3.1.
"Disposition Notice" is defined in Section 6.2(a).
"Environmental Laws" means all federal, state, and local laws,
statutes, rules, regulations, orders, and ordinances, now or hereafter
in effect, relating to protection of 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 from
time to time.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"First ROFR Acceptance Deadline" is defined in Section 6.2(a).
"General Partner" is defined in the introduction to this
Agreement.
"Hazardous Substance" means (a) any substance that is
designated, defined, or classified as a hazardous waste, hazardous
material, pollutant, contaminant, or toxic or hazardous substance, or
that is otherwise regulated under any Environmental Law, including,
without limitation, any hazardous substance as defined under the
Comprehensive Environmental Response, Compensation, and Liability Act,
and (b) petroleum, oil, gasoline, natural gas, fuel oil, motor oil,
waste oil, diesel fuel, jet fuel, and other refined petroleum
hydrocarbons.
"Xxxxx Entities" means Xxxxx and any Person controlled,
directly or indirectly, by Xxxxx other than the Partnership Group or
the General Partner; and "Xxxxx Entity" means any of the Xxxxx
Entities.
"Indemnified Party" means the Partnership Entities or the
Xxxxx Entities, as the case may be, in its capacity as the party
entitled to indemnification in accordance with Article III.
"Indemnifying Party" means either the Partnership Entities or
Xxxxx, as the case may be, in its capacity as the party from whom
indemnification may be sought in accordance with Article III.
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"Intermediate Pipelines" means the 8-inch pipeline running
from Lovington, New Mexico to Artesia, New Mexico and the 10-inch
pipeline running from Lovington, New Mexico to Artesia, New Mexico,
each owned by Navajo Pipeline.
"Limited Partner" is defined in the Partnership Agreement.
"Offer" is defined in Section 2.3(a).
"Offer Price" is defined in Section 6.2(a).
"Option Asset Owner" means, with respect to an Option Asset,
the applicable Xxxxx Entity set forth opposite such Option Asset on
Schedule I to this Agreement.
"Option Assets" means the assets listed on Schedule I to this
Agreement.
"Partnership Agreement" means the First Amended and Restated
Agreement of Limited Partnership of Xxxxx Energy Partners, L.P., dated
as of the Closing Date, as such agreement is in effect on the Closing
Date, to which reference is hereby made for all purposes of this
Agreement. No amendment or modification to the Partnership 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.
"Partnership Entities" means Xxxxx GP, the General Partner and
each member of the Partnership Group.
"Partnership Entity" means any of the Partnership Entities.
"Partnership Group" means the Partnership, Xxxxx GP LLC, the
Operating Partnership and any Subsidiary of any such Person, treated as
a single consolidated entity.
"Partnership Group Member" means any member of the Partnership
Group.
"Party" and "Parties" are defined in the introduction to this
Agreement.
"Person" means an individual or a corporation, limited
liability company, partnership, joint venture, trust, unincorporated
organization association, government agency or political subdivision
thereof or other entity.
"Proposed Transferee" is defined in Section 6.2(a).
"Prudent Industry Practice" means such practices, methods,
acts, techniques, and standards as are in effect at the time in
question that are consistent with (a) the standards generally followed
by the United States pipeline and terminalling industries or (b) such
higher standards as may be applied or followed by the Xxxxx Entities in
the performance of similar tasks or projects, or by the Partnership
Entities in the performance of similar tasks or projects.
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"Restricted Businesses" is defined in Section 2.1.
"Retained Assets" means the pipelines, terminals and other
assets and investments owned by any of the Xxxxx Entities that were not
conveyed, contributed or otherwise transferred to the Partnership Group
pursuant to the Contribution Agreement and other documents relating to
the transactions referred to in the Contribution Agreement, including,
without limitation, the Intermediate Pipelines.
"ROFR Acceptance Deadline" means the First ROFR Acceptance
Deadline or the Second ROFR Acceptance Deadline, as applicable.
"Sale Assets" is defined in Section 6.2(a).
"Second ROFR Acceptance Deadline" is defined in Section
6.2(a).
"Subject Assets" is defined in Section 2.2(d).
"Subsidiary" means, with respect to any Person, (a) a
corporation of which more than 50% of the voting power of shares
entitled (without regard to the occurrence of any contingency) to vote
in the election of directors or other governing body of such
corporation is owned, directly or indirectly, at the date of
determination, by such Person, by one or more Subsidiaries of such
Person or a combination thereof, (b) a partnership (whether general or
limited) in which such Person or a Subsidiary of such Person is, at the
date of determination, a general or limited partner of such
partnership, but only if more than 50% of the partnership interests of
such partnership (considering all of the partnership interests of the
partnership as a single class) is owned, directly or indirectly, at the
date of determination, by such Person, by one or more Subsidiaries of
such Person, or a combination thereof, or (c) any other Person (other
than a corporation or a partnership) in which such Person, one or more
Subsidiaries of such Person, or a combination thereof, directly or
indirectly, at the date of determination, has (i) at least a majority
ownership interest or (ii) the power to elect or direct the election of
a majority of the directors or other governing body of such Person.
"Toxic Tort" means a claim or cause of action arising from
personal injury or property damage incurred by the plaintiff that is
alleged to have been caused by exposure to, or contamination by,
Hazardous Substances that have been released into the environment by or
as a result of the actions or omissions of the defendant.
"Transfer" including the correlative terms "Transferring" or
"Transferred" means any direct or indirect transfer, assignment, sale,
gift, pledge, hypothecation or other encumbrance, or any other
disposition (whether voluntary, involuntary or by operation of law) of
the Assets.
"Units" is defined in the Partnership Agreement.
"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 governing body
of such Person.
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ARTICLE II
BUSINESS OPPORTUNITIES
2.1 RESTRICTED BUSINESSES. For so long as (i) Xxxxx GP (or any
Affiliate of the Xxxxx Entities) is the general partner of the General Partner
and (ii) the General Partner (or any Affiliate of the Xxxxx Entities) is the
general partner of the Partnership, and except as permitted by Section 2.2, each
of the Xxxxx Entities shall be prohibited from engaging in or acquiring or
investing in any business having assets engaged in the following businesses (the
"Restricted Businesses"): the ownership and/or operation of crude oil pipelines
or terminals, intermediate product pipelines or terminals, refined products
pipelines or terminals, truck racks or crude oil gathering systems in the
continental United States.
2.2 PERMITTED EXCEPTIONS. Notwithstanding any provision of Section 2.1
to the contrary, the Xxxxx Entities may engage in the following activities under
the following circumstances:
(a) the ownership and/or operation of any of the Retained
Assets (including replacements of the Retained Assets);
(b) the ownership and/or operation of any crude oil pipeline
or gathering system, acquired or constructed by a Xxxxx Entity that is
physically inter-connected to a Xxxxx Entity's refinery by its assets;
(c) any Restricted Business conducted by a Xxxxx Entity with
the approval of the Conflicts Committee;
(d) the ownership and/or operation of any asset or group of
related assets used in the activities described in Section 2.1 that are
acquired or constructed by a Xxxxx Entity after the date of this Agreement
(the "Subject Assets") if, in the case of an acquisition, the fair market
value of the Subject Assets (as determined in good faith by the Board of
Directors of Xxxxx), or, in the case of construction, the construction cost
of the Subject Assets, is less than $5 million at the time of such
acquisition by the Xxxxx Entity or completion of construction, as the case
may be;
(e) the ownership and/or operation of any Subject Assets
acquired by a Xxxxx Entity with a fair market value (as determined in good
faith by the Board of Directors of Xxxxx) greater than $5 million at the
time of the acquisition; provided, the Partnership has been offered the
opportunity to purchase the Subject Assets in accordance with Section 2.3
and the Partnership (with the concurrence of the Conflicts Committee) has
elected not to purchase the Subject Assets; and
(f) the ownership and/or operation of any Subject Assets
constructed by a Xxxxx Entity with a construction cost greater than $5
million at the time of completion of construction that the Partnership has
been offered the opportunity to purchase in accordance with Section 2.3 and
the Partnership (with the concurrence of the Conflicts Committee) has
elected not to purchase.
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2.3 PROCEDURES.
(a) If a Xxxxx Entity acquires or constructs Subject Assets
described in Section 2.2(e) or (f), then not later than six months after
the consummation of the acquisition or the completion of construction by
such Xxxxx Entity of the Subject Assets, as the case may be, the Xxxxx
Entity shall notify the General Partner in writing of such acquisition or
construction and offer the Partnership Group the opportunity to purchase
such Subject Assets in accordance with this Section 2.3 (the "Offer"). The
Offer shall set forth the terms relating to the purchase of the Subject
Assets and, if any Xxxxx Entity desires to utilize the Subject Assets, the
Offer will also include the commercially reasonable terms on which the
Partnership Group will provide services to the Xxxxx Entity to enable the
Xxxxx Entity to utilize the Subject Assets. As soon as practicable, but in
any event within 60 days after receipt of such written notification, the
General Partner shall notify the Xxxxx Entity in writing that either (i)
the General Partner has elected, with the approval of the Conflicts
Committee, not to cause a Partnership Group Member to purchase the Subject
Assets, in which event the Xxxxx Entity shall be forever free to continue
to own or operate such Subject Assets, or (ii) the General Partner has
elected to cause a Partnership Group Member to purchase the Subject Assets,
in which event the procedures outlined in this Section 2.3 shall apply.
(b) If the Xxxxx Entity and the General Partner (with the
concurrence of the Conflicts Committee) within 60 days after receipt by the
General Partner of the Offer are able to agree on the fair market value of
the Subject Assets that are subject to the Offer and the other terms of the
Offer including, without limitation, the terms, if any, on which the
Partnership Group will provide services to the Xxxxx Entity to enable the
Xxxxx Entity to utilize the Subject Assets, a Partnership Group Member
shall purchase the Subject Assets for the agreed upon fair market value as
soon as commercially practicable after such agreement has been reached and,
if applicable, enter into an agreement with the Xxxxx Entity to provide
services in a manner consistent with the Offer. The purchase agreement for
the Subject Assets will provide for the purchase price to be paid, at the
option of the Xxxxx Entity, in cash, Units, or an interest-bearing
promissory note (the interest rate and other terms of which shall be
mutually agreed upon by the Xxxxx Entity and the General Partner).
(c) If the Xxxxx Entity and the General Partner are unable to
agree within 60 days after receipt by the General Partner of the Offer on
the fair market value of the Subject Assets that are subject to the Offer
or the other terms of the Offer including, if applicable, the terms on
which the Partnership Group will provide services to the Xxxxx Entity to
enable the Xxxxx Entity to utilize the Subject Assets, the Xxxxx Entity and
the General Partner will engage a mutually agreed upon investment banking
firm to determine the fair market value of the Subject Assets and/or the
other terms on which the Partnership Group and the Xxxxx Entity are unable
to agree. Such investment banking firm will determine the fair market value
of the Subject Assets and/or the other terms on which the Partnership Group
and the Xxxxx Entity are unable to agree within 30 days of its engagement
and furnish the Xxxxx Entity and the General Partner its determination. The
fees of the investment banking firm will be split equally between the Xxxxx
Entity and the Partnership Group. Once the investment banking firm has
submitted
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its determination of the fair market value of the Subject Assets and/or the
other terms on which the Partnership Group and the Xxxxx Entity are unable
to agree, the General Partner will have the right, but not the obligation,
subject to the approval of the Conflicts Committee, to cause a Partnership
Group Member to purchase the Subject Assets pursuant to the Offer as
modified by the determination of the investment banking firm. The
Partnership Group will provide written notice of its decision to the Xxxxx
Entity within 15 days after the investment banking firm has submitted its
determination. Failure to provide such notice within such 15-day period
shall be deemed to constitute a decision not to purchase the Subject
Assets. If the General Partner elects to cause a Partnership Group Member
to purchase the Subject Assets, then the Partnership Group Member shall
purchase the Subject Assets pursuant to the Offer as modified by the
determination of the investment banking firm as soon as commercially
practicable after such determination and, if applicable, enter into an
agreement with the Xxxxx Entity to provide services in a manner consistent
with the Offer, as modified by the determination of the investment banking
firm, if applicable. The purchase agreement for the Subject Assets will
provide for the purchase price to be paid, at the option of the Xxxxx
Entity, in cash, Units, or an interest-bearing promissory note (the
interest rate and other terms of which shall be mutually agreed upon by the
Xxxxx Entity and the General Partner).
2.4 SCOPE OF PROHIBITION. Except as provided in this Article II and the
Partnership Agreement, each Xxxxx Entity shall be free to engage in any business
activity, including those that may be in direct competition with any Partnership
Group Member.
2.5 ENFORCEMENT. The Xxxxx Entities agree and acknowledge that the
Partnership Group does not have an adequate remedy at law for the breach by the
Xxxxx Entities of the covenants and agreements set forth in this Article II, and
that any breach by the Xxxxx Entities of the covenants and agreements set forth
in this Article II would result in irreparable injury to the Partnership Group.
The Xxxxx Entities further agree and acknowledge that any Partnership Group
Member may, in addition to the other remedies which may be available to the
Partnership Group, file a suit in equity to enjoin the Xxxxx Entities from such
breach, and consent to the issuance of injunctive relief under this Agreement.
ARTICLE III
INDEMNIFICATION
3.1 ENVIRONMENTAL INDEMNIFICATION.
(a) Subject to Section 3.2, Xxxxx shall indemnify, defend and
hold harmless the Partnership Group for a period of 10 years after the
Closing Date from and against environmental and Toxic Tort losses
(including, without limitation, economic losses, diminution in value
suffered by third parties, and lost profits), damages, injuries (including,
without limitation, personal injury and death), liabilities, claims,
demands, causes of action, judgments, settlements, fines, penalties, costs,
and expenses (including, without limitation, court costs and reasonable
attorney's and expert's fees) of any and every kind or character, known or
unknown, fixed or contingent, suffered or incurred by the Partnership Group
or any third party by reason of or arising out of:
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(i) any violation or correction of violation of
Environmental Laws, or
(ii) any event or condition associated with ownership
or operation of the Assets (including, without limitation, the presence of
Hazardous Substances on, under, about or migrating to or from the Assets or
the disposal or release of Hazardous Substances generated by operation of
the Assets at non-Asset locations) including, without limitation, (A) the
cost and expense of any investigation, assessment, evaluation, monitoring,
containment, cleanup, repair, restoration, remediation, or other corrective
action required or necessary under Environmental Laws, (B) the cost or
expense of the preparation and implementation of any closure, remedial,
corrective action, or other plans required or necessary under Environmental
Laws, and (C) the cost and expense for any environmental or Toxic Tort
pre-trial, trial, or appellate legal or litigation support work;
but only to the extent that such violation complained of under Section
3.1(a)(i) or such events or conditions included under Section 3.1(a)(ii)
occurred before the Closing Date (collectively, "Covered Environmental
Losses").
(b) The Partnership Group shall indemnify, defend and hold
harmless the Xxxxx Entities from and against environmental and Toxic Tort
losses (including, without limitation, economic losses, diminution in value
suffered by third parties, and lost profits), damages, injuries (including,
without limitation, personal injury and death), liabilities, claims,
demands, causes of action, judgments, settlements, fines, penalties, costs,
and expenses (including, without limitation, court costs and reasonable
attorney's and expert's fees) of any and every kind or character, known or
unknown, fixed or contingent, suffered or incurred by the Xxxxx Entities or
any third party by reason of or arising out of:
(i) any violation or correction of violation of
Environmental Laws, or
(ii) any event or condition associated with ownership
or operation of the Assets (including, but not limited to, the presence of
Hazardous Substances on, under, about or migrating to or from the Assets or
the disposal or release of Hazardous Substances generated by operation of
the Assets at non-Asset locations) including, without limitation, (A) the
cost and expense of any investigation, assessment, evaluation, monitoring,
containment, cleanup, repair, restoration, remediation, or other corrective
action required or necessary under Environmental Laws, (B) the cost or
expense of the preparation and implementation of any closure, remedial,
corrective action, or other plans required or necessary under Environmental
Laws, and (C) the cost and expense for any environmental or Toxic Tort
pre-trial, trial, or appellate legal or litigation support work;
and regardless of whether such violation complained of under Section
3.1(b)(i) or such events or conditions included under Section 3.1(b)(ii)
occurred before or after the Closing Date, except to the extent that any of
the foregoing are Covered Environmental Losses
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for which the Partnership Group is entitled to indemnification from Xxxxx
under this Article III.
3.2 LIMITATIONS REGARDING ENVIRONMENTAL INDEMNIFICATION. The aggregate
liability of Xxxxx in respect of all Covered Environmental Losses under Section
3.1(a) shall not exceed $15.0 million and Xxxxx will not have any obligation
under Section 3.1(a) until the Covered Environmental Losses of the Partnership
Group exceed $200,000.
3.3 RIGHT OF WAY INDEMNIFICATION. Xxxxx shall indemnify, defend and
hold harmless the Partnership Group from and against any losses, damages,
liabilities, claims, demands, causes of action, judgments, settlements, fines,
penalties, costs, and expenses (including, without limitation, court costs and
reasonable attorney's and expert's fees) of any and every kind or character,
known or unknown, fixed or contingent, suffered or incurred by the Partnership
Group by reason of or arising out of (a) the failure of the applicable
Partnership Group Member to be the owner of such valid and indefeasible easement
rights or fee ownership interests in and to the lands on which any crude oil or
refined products pipeline or related pump station, tank farm or equipment
conveyed or contributed to the applicable Partnership Group Member on the
Closing Date is located as of the Closing Date; (b) the failure of the
applicable Partnership Group Member to have the consents, licenses and permits
necessary to allow any such pipeline referred to in clause (a) of this Section
3.3 to cross the roads, waterways, railroads and other areas upon which any such
pipeline is located as of the Closing Date; and (c) the cost of curing any
condition set forth in clause (a) or (b) above that does not allow any Asset to
be operated in accordance with Prudent Industry Practice, to the extent that
Xxxxx is notified in writing of any of the foregoing within 10 years after the
Closing Date.
3.4 ADDITIONAL INDEMNIFICATION.
(a) In addition to and not in limitation of the
indemnification provided under Sections 3.1(a) and 3.3, Xxxxx shall
indemnify, defend, and hold harmless the Partnership Group from and against
any losses, damages, liabilities, claims, demands, causes of action,
judgments, settlements, fines, penalties, costs, and expenses (including,
without limitation, court costs and reasonable attorney's and expert's
fees) of any and every kind or character, known or unknown, fixed or
contingent, suffered or incurred by the Partnership Group by reason of or
arising out of (i) events and conditions associated with the operation of
the Assets and occurring before the Closing Date (other than Covered
Environmental Losses which are provided for under Sections 3.1 and 3.2) to
the extent that Xxxxx is notified in writing of any of the foregoing within
five years after the Closing Date, (ii) the currently pending legal actions
against the Xxxxx Entities set forth on Schedule II attached hereto, (iii)
the completion of remediation projects at the Partnership's El Paso,
Albuquerque and Mountain Home terminals, (iv) events and conditions
associated with the Retained Assets and whether occurring before or after
the Closing Date, and (iv) all federal, state and local income tax
liabilities attributable to the operation of the Assets prior to the
Closing Date, including any such income tax liabilities of the Xxxxx
Entities that may result from the consummation of the formation
transactions for the Partnership Group and the General Partner.
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(b) In addition to and not in limitation of the
indemnification provided under Section 3.1(b) or the Partnership Agreement,
the Partnership Group shall indemnify, defend, and hold harmless the Xxxxx
Entities from and against any losses, damages, liabilities, claims,
demands, causes of action, judgments, settlements, fines, penalties, costs,
and expenses (including, without limitation, court costs and reasonable
attorney's and expert's fees) of any and every kind or character, known or
unknown, fixed or contingent, suffered or incurred by the Xxxxx Entities by
reason of or arising out of events and conditions associated with the
operation of the Assets and occurring on or after the Closing Date (other
than Covered Environmental Losses which are provided for under Section
3.1), unless such indemnification would not be permitted under the
Partnership Agreement by reason of one of the provisos contained in Section
7.7(a) of the Partnership Agreement.
3.5 INDEMNIFICATION PROCEDURES.
(a) The Indemnified Party agrees that promptly after it
becomes aware of facts giving rise to a claim for indemnification under
this Article III, it will provide notice thereof in writing to the
Indemnifying Party, specifying the nature of and specific basis for such
claim.
(b) The Indemnifying Party shall have the right to control all
aspects of the defense of (and any counterclaims with respect to) any
claims brought against the Indemnified Party that are covered by the
indemnification under this Article III, 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 Indemnified Party unless it includes a full
release of the Indemnified Party from such matter or issues, as the case
may be.
(c) The Indemnified Party agrees to cooperate fully with the
Indemnifying Party, with respect to all aspects of the defense of any
claims covered by the indemnification under this Article III, including,
without limitation, the prompt furnishing to the Indemnifying Party of any
correspondence or other notice relating thereto that the Indemnified Party
may receive, permitting the name of the Indemnified Party to be utilized in
connection with such defense, the making available to the Indemnifying
Party of any files, records or other information of the Indemnified Party
that the Indemnifying Party considers relevant to such defense and the
making available to the Indemnifying Party of any employees of the
Indemnified Party; provided, however, that in connection therewith the
Indemnifying Party agrees to use reasonable efforts to minimize the impact
thereof on the operations of the Indemnified Party and further agrees to
maintain the confidentiality of all files, records, and other information
furnished by the Indemnified Party pursuant to this Section 3.5. In no
event shall the obligation of the Indemnified Party to cooperate with the
Indemnifying Party as set forth in the immediately preceding sentence be
construed as imposing upon the Indemnified Party an obligation to hire and
pay for counsel in connection with the defense of any claims covered by the
indemnification set forth in this Article III; provided, however, that the
Indemnified Party may, at its own option, cost and expense, hire and pay
for counsel in
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connection with any such defense. The Indemnifying Party agrees to keep any
such counsel hired by the Indemnified Party informed as to the status of
any such defense, but the Indemnifying Party shall have the right to retain
sole control over such defense.
(d) In determining the amount of any loss, cost, damage or
expense for which the Indemnified Party is entitled to indemnification
under this Agreement, the gross amount of the indemnification will be
reduced by (i) any insurance proceeds realized by the Indemnified Party,
and such correlative insurance benefit shall be net of any incremental
insurance premium that becomes due and payable by the Indemnified Party as
a result of such claim and (ii) all amounts recovered by the Indemnified
Party under contractual indemnities from third Persons.
(e) The date on which notification of a claim for
indemnification is received by the Indemnifying Party shall determine
whether such claim is timely made.
ARTICLE IV
GENERAL AND ADMINISTRATIVE EXPENSES
4.1 GENERAL.
(a) The Partnership will pay the General Partner an
administrative fee (the "Administrative Fee") of $2.0 million per year for
the provision by the General Partner and its Affiliates for the Partnership
Group's benefit of all the general and administrative services that Xxxxx
and its Affiliates have traditionally provided in connection with the
Assets including, without limitation, the general and administrative
services listed on Schedule III to this Agreement. Xxxxx may increase the
Administrative Fee on the second and third anniversary date of this
Agreement by an amount up to the greater of (i) 5.0% or (ii) the Consumer
Price Index -- All Urban Consumers, U.S. City Average, Not Seasonally
Adjusted for the applicable year. The General Partner, with the approval
and consent of its Conflicts Committee, may agree on behalf of the
Partnership to further increases in the Administrative Fee in connection
with expansions of the operations of the Partnership Group through the
acquisition or construction of new assets or businesses. After this
three-year period, the General Partner will determine the amount of general
and administrative expenses that will be properly allocated to the
Partnership in accordance with the terms of the Partnership Agreement.
(b) At the end of each year, the Partnership will have the
right to submit to the General Partner a proposal to reduce the amount of
the Administrative Fee for that year if the Partnership believes, in good
faith, that the general and administrative services performed by the
General Partner and its Affiliates for the benefit of the Partnership Group
for the year in question do not justify payment of the full Administrative
Fee for that year. If the Partnership submits such a proposal to the
General Partner, the General Partner agrees that it will negotiate in good
faith with the Partnership to determine if the Administrative Fee for that
year should be reduced and, if so, by how much.
(c) The Administrative Fee shall not include and the
Partnership Group shall reimburse the General Partner for:
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(i) salaries of employees of Xxxxx GP, to the extent,
but only to the extent, such employees perform services for the Partnership
Group;
(ii) the cost of employee benefits relating to
employees of Xxxxx GP, such as 401(k), pension, and health insurance
benefits, to the extent, but only to the extent, such employees perform
services for the Partnership Group; and
(iii) all sales, use, excise, value added or similar
taxes, if any, that may be applicable from time to time in respect of the
services provided by the General Partner and its Affiliates to Xxxxx
pursuant to Section 4.1(a).
ARTICLE V
PURCHASE OPTIONS
5.1 OPTION TO PURCHASE CERTAIN ASSETS RETAINED BY XXXXX ENTITIES.
(a) Each Option Asset Owner hereby grants to the Partnership
Group the unconditional right and option for a period of 3 years from the
Closing Date to purchase for fair market value at the time of purchase all
of such Option Asset Owner's right title and interest in, to and under the
Option Asset(s) set forth next to its name on Schedule I.
(b) Xxxxx will take all action required to cause the Option
Asset Owners to comply with the terms of this Article V.
(c) The Parties acknowledge that all potential transfers of
Option Assets pursuant to this Article V are subject to obtaining any and
all written consents of governmental authorities and other third parties
and to the terms of all existing agreements in respect of the Option Assets
including, without limitation, any rights of first refusal of the parties
to such agreements to purchase the Option Assets.
5.2 PROCEDURES.
(a) If a Partnership Group Member decides to exercise the
option to purchase an Option Asset, it will provide written notice to the
applicable Option Asset Owner of such exercise, the fair market value it
proposes to pay for the Option Asset, and the other terms of the purchase
including, if requested by a Xxxxx Entity, the terms on which the
Partnership Group Member will provide services to the Xxxxx Entity to
enable the Xxxxx Entity to utilize the Option Asset. The decision to
purchase an Option Asset, the fair market value to be paid for the Option
Asset, and the other terms of the purchase including, if applicable, the
terms on which the Partnership Group Member will provide services to the
Xxxxx Entity to enable the Xxxxx Entity to utilize the Option Asset shall
be approved by the Conflicts Committee. If the Partnership Group Member and
the applicable Option Asset Owner are unable to agree on the fair market
value of the Option Asset or the other terms of the purchase including, if
applicable, the terms on which the Partnership Group Member will provide
services to the Xxxxx Entity to enable the Xxxxx Entity to utilize the
Option Asset, the Partnership Group Member and the applicable Option Asset
Owner will engage a mutually-agreed-upon investment banking firm to
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determine the fair market value of the Option Asset and/or the other terms
on which the Partnership Group Member and the Xxxxx Entity are unable to
agree. The fees of the investment banking firm will be split equally
between the applicable Option Asset Owner and the Partnership Group. Once
the investment banking firm submits its determination of the fair market
value of the Option Asset and/or the other terms on which the applicable
Option Asset Owner and the Partnership Group Member are unable to agree,
the Partnership Group Member will have the right, but not the obligation,
to purchase the Option Asset on the terms as modified by the determination
of the investment banking firm. The Partnership Group Member will provide
written notice of its decision to the applicable Option Asset Owner within
15 days after the investment banking firm has submitted its determination.
Failure to provide such notice within such 15-day period shall be deemed to
constitute a decision not to purchase the Option Asset.
(b) If a Partnership Group Member chooses to exercise its
option to purchase an Option Asset under Section 5.2(a), this Agreement
shall become a contract of sale and purchase for the Option Asset pursuant
to which the applicable Option Asset Owner shall be obligated to sell the
Option Asset to the Partnership Group Member and the Partnership Group
Member shall be obligated to purchase the Option Asset from the applicable
Option Asset Owner and, if applicable, the Partnership Group Member will
enter into an agreement with the Xxxxx Entity setting forth the terms on
which the Partnership Group Member will provide services to the Xxxxx
Entity to enable the Xxxxx Entity to utilize the Option Asset. The terms of
the purchase and sale agreement will include the following:
(i) the Partnership Group Member will deliver a cash
purchase price (unless the Partnership Group Member and the applicable
Option Asset Owner agree that the consideration will be paid by means of
Units or an interest-bearing promissory note);
(ii) the Partnership Group will be entitled to the
benefit of the indemnification contained in Article III of this Agreement
for the remaining term of such indemnification with respect to events or
conditions associated with the operation of the Option Asset and occurring
before the date of acquisition of the Option Asset by the Partnership Group
Member;
(iii) the applicable Option Asset Owner will
represent that it has good and indefeasible title to the Option Asset,
subject to all recorded and unrecorded matters and all physical conditions
and other matters in existence on the closing date for the purchase of the
applicable Option Asset, plus any other such matters as the Partnership
Group Member may approve, which approval will not be unreasonably withheld.
If the Partnership Group Member desires to obtain any title insurance with
respect to the Option Asset, the full cost and expense of obtaining the
same (including but not limited to the cost of title examination, document
duplication and policy premium) shall be borne by the Partnership Group
Member;
(iv) the applicable Option Asset Owner will grant to
the Partnership Group Member the right, exercisable at the Partnership
Group Member's risk
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and expense, to make such surveys, tests and inspections of the Option
Asset as the Partnership Group Member may deem desirable, so long as such
surveys, tests or inspections do not damage the Option Asset or interfere
with the activities of the applicable Option Asset Owner thereon and so
long as the Partnership Group Member has furnished the applicable Option
Asset Owner with evidence that adequate liability insurance is in full
force and effect;
(v) the Partnership Group Member will have the right
to terminate its obligation to purchase the Option Asset under this Article
V if the results of any searches, surveys, tests or inspections conducted
pursuant to Section 5.2(b)(iii) or (iv) above are, in the reasonable
opinion of the Partnership Group, unsatisfactory;
(vi) the closing date for the purchase of the Option
Asset shall occur no later than 90 days following receipt by Xxxxx of
written notice by the Partnership Group Member of its intention to exercise
its option to purchase the Option Asset pursuant to Section 5.2(a);
(vii) the applicable Option Asset Owner shall
execute, have acknowledged and deliver to the Partnership Group Member a
special warranty deed, assignment of easement, or comparable document, as
appropriate, in the applicable jurisdiction, on the closing date for the
purchase of the Option Asset constituting a real property interest
conveying the Option Asset unto the Partnership Group Member free and clear
of all encumbrances created by the Option Asset Owner other than those set
forth in Section 5.2(b)(iii) above;
(viii) the sale of any Option Asset shall be made on
an "as is," "where is" and "with all faults" basis, and the instruments
conveying such Option Asset shall contain appropriate disclaimers; and
(ix) neither the applicable Option Asset Owner nor
the applicable Partnership Group Member shall have any obligation to sell
or buy the applicable Option Asset if any of the material consents referred
to in Section 5.1(c) have not been obtained.
(c) If a Partnership Group Member chooses or is deemed to have
chosen not to exercise its option to purchase an Option Asset at the price
determined by the investment banking firm under Section 5.2(a), all future
rights to purchase such Option Asset by the Partnership Group will be
extinguished.
ARTICLE VI
RIGHT OF FIRST REFUSAL
6.1 XXXXX RIGHT OF FIRST REFUSAL.
(a) The Partnership Group hereby grants to Xxxxx a right of
first refusal on any proposed Transfer [(other than a grant of a security
interest to a bona fide third-party lender)] of the Assets that serve the
Xxxxx Entities' refineries.
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(b) The Parties acknowledge that all potential Transfers of
Sale Assets pursuant to this Article VI are subject to obtaining any and
all written consents of governmental authorities and other third parties
and to the terms of all existing agreements in respect of the Assets.
6.2 PROCEDURES.
(a) If a Partnership Group Member desires to Transfer any of
the Assets that serve the Xxxxx Entities' refineries to any Person pursuant
to a bona fide third-party offer (an "Acquisition Proposal"), then the
Partnership shall promptly give written notice (a "Disposition Notice")
thereof to Xxxxx. The Disposition Notice shall set forth the following
information in respect of the proposed Transfer: the name and address of
the prospective acquiror (the "Proposed Transferee"), the Assets subject to
the Acquisition Proposal (the "Sale Assets"), the purchase price offered by
such Proposed Transferee (the "Offer Price"), reasonable detail concerning
any non-cash portion of the proposed consideration, if any, to allow Xxxxx
to reasonably determine the fair market value of such non-cash
consideration, the Partnership Group's calculation of the fair market value
of any non-cash consideration and all other material terms and conditions
of the Acquisition Proposal that are then known to the Partnership Group.
To the extent the Proposed Transferee's offer consists of consideration
other than cash (or in addition to cash) the Offer Price shall be equal to
the amount of any such cash plus the fair market value of such non-cash
consideration. In the event Xxxxx and the Partnership Group are in
agreement as to the fair market value of any non-cash consideration, Xxxxx
will provide written notice of its decision regarding the exercise of its
right of first refusal to purchase the Sale Assets within 30 days of its
receipt of the Disposition Notice (the "First ROFR Acceptance Deadline").
Failure to provide such notice within such 30-day period shall be deemed to
constitute a decision not to purchase the Sale Assets. In the event (i)
Holly's determination of the fair market value of any non-cash
consideration described in the Disposition Notice (to be determined by
Xxxxx within 30 days of receipt of such Disposition Notice) is less than
the fair market value of such consideration as determined by the
Partnership Group in the Disposition Notice and (ii) Xxxxx and the
Partnership Group are unable to mutually agree upon the fair market value
of such non-cash consideration within 30 days after Xxxxx notifies the
Partnership Group of its determination thereof, the Partnership Group and
Xxxxx shall engage a mutually-agreed-upon investment banking firm to
determine the fair market value of the non-cash consideration. Such
investment banking firm shall be instructed to return its decision within
30 days after all material information is submitted thereto, which decision
shall be final. The fees of the investment banking firm will be split
equally between Xxxxx and the Partnership Group. Xxxxx will provide written
notice of its decision regarding the exercise of its right of first refusal
to purchase the Sale Assets to the Partnership Group within 30 days after
the investment banking firm has submitted its determination (the "Second
ROFR Acceptance Deadline"). Failure to provide such notice within such
30-day period shall be deemed to constitute a decision by Xxxxx not to
purchase the Sale Assets. If Xxxxx fails to exercise a right during any
applicable period set forth in this Section 6.2(a), Xxxxx shall be deemed
to have waived its rights with respect to such proposed disposition of the
Sale Assets, but not with respect to any future offer of Assets.
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(b) If Xxxxx chooses to exercise its right of first refusal to
purchase the Sale Assets under Section 6.2(a), Xxxxx and the Partnership
Group shall enter into a purchase and sale agreement for the Sale Assets
which shall include the following terms:
(i) Xxxxx will agree to deliver cash for the Offer
Price (unless Xxxxx and the Partnership Group agree that consideration will
be paid by means of an interest-bearing promissory note or equity
securities of Xxxxx);
(ii) the Partnership Group will represent that it has
good and indefeasible title to the Sale Assets, subject to all recorded and
unrecorded matters and all physical conditions and other matters in
existence on the closing date for the purchase of the Sale Assets, plus any
other such matters as Xxxxx may approve, which approval will not be
unreasonably withheld. If Xxxxx desires to obtain any title insurance with
respect to the Sale Assets, the full cost and expense of obtaining the same
(including but not limited to the cost of title examination, document
duplication and policy premium) shall be borne by Xxxxx;
(iii) the Partnership Group will grant to Xxxxx the
right, exercisable at Holly's risk and expense, to make such surveys, tests
and inspections of the Sale Assets as Xxxxx may deem desirable, so long as
such surveys, tests or inspections do not damage the Sale Assets or
interfere with the activities of the Partnership Group thereon and so long
as Xxxxx has furnished the Partnership Group with evidence that adequate
liability insurance is in full force and effect;
(iv) Xxxxx will have the right to terminate its
obligation to purchase the Sale Assets under this Article VI if the results
of any searches, surveys, tests or inspections conducted pursuant to
Section 6.2(b)(ii) or (iii) above are, in the reasonable opinion of Xxxxx,
unsatisfactory;
(v) the closing date for the purchase of the Sale
Assets shall occur no later than 90 days following receipt by the
Partnership Group of written notice by Xxxxx of its intention to exercise
its option to purchase the Sale Assets pursuant to Section 6.2(a);
(vi) the Partnership Group shall execute, have
acknowledged and deliver to Xxxxx a special warranty deed, assignment of
easement, or comparable document, as appropriate, in the applicable
jurisdiction, on the closing date for the purchase of the Sale Assets
constituting real property interests conveying the Sale Assets unto Xxxxx
free and clear of all encumbrances created by the Partnership Group other
than those set forth in Section 6.2(b)(ii) above;
(vii) the sale of any Sale Assets shall be made on an
"as is," "where is" and "with all faults" basis, and the instruments
conveying such Sale Assets shall contain appropriate disclaimers; and
(viii) neither the Partnership Group nor Xxxxx shall
have any obligation to sell or buy the Sale Assets if any of the material
consents referred to in Section 6.1(b) have not been obtained.
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(c) Xxxxx and the Partnership Group shall cooperate in good
faith in obtaining all necessary governmental and other third Person
approvals, waivers and consents required for the closing. Any such closing
shall be delayed, to the extent required, until the third Business Day
following the expiration of any required waiting periods under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended; provided,
however, that such delay shall not exceed 60 days and, if governmental
approvals and waiting periods shall not have been obtained or expired, as
the case may be, by such 60th day, then Xxxxx shall be deemed to have
waived its right of first refusal with respect to the Sale Assets described
in the Disposition Notice and thereafter neither Xxxxx nor the Partnership
shall have any further obligation under this Article VI with respect to
such Sale Assets unless such Sale Assets again become subject to this
Article VI pursuant to Section 6.2(d).
(d) If the Transfer to the Proposed Transferee is not
consummated in accordance with the terms of the Acquisition Proposal within
the later of (A) 180 days after the later of the applicable ROFR Acceptance
Deadline, and (B) 10 days after the satisfaction of all governmental
approval or filing requirements, if any, the Acquisition Proposal shall be
deemed to lapse, and the Partnership or member of the Partnership Group may
not Transfer any of the Sale Assets described in the Disposition Notice
without complying again with the provisions of this Article VI if and to
the extent then applicable.
ARTICLE VII
MISCELLANEOUS
7.1 CHOICE OF LAW; SUBMISSION TO JURISDICTION. This Agreement shall be
subject to and governed by the laws of the State of Texas, 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
Texas and to venue in Dallas, Texas.
7.2 NOTICE. All notices or requests or consents provided for by, or
permitted to be given pursuant to, this Agreement must be in writing and must be
given by depositing same in the United States mail, addressed to the Person to
be notified, postpaid, and registered or certified with return receipt requested
or by delivering such notice in person or by telecopier or telegram to such
Party. Notice given by personal delivery or mail shall be effective upon actual
receipt. Notice given by telegram or telecopier shall be effective upon actual
receipt if received during the recipient's normal business hours or at the
beginning of the recipient's next business day after receipt if not received
during the recipient's normal business hours. All notices to be sent to a Party
pursuant to this Agreement shall be sent to or made at the address set forth
below such Party's signature to this Agreement or at such other address as such
Party may stipulate to the other Parties in the manner provided in this Section
7.2.
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if to the Xxxxx Entities:
Xxxxx Corporation
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: [President]
Fax: 214-____-_______
with a copy to:
Xxxx Xxxxxx
General Counsel
Xxxxx Corporation
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Fax: 214-____-_______
if to the Partnership Group
Xxxxx Energy Partners, L.P.
c/o Xxxxx Logistic Services, L.L.C.
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: President and Chief Executive Officer
Fax: (214) ____-_______
with a copy to:
--------------------------
--------------------------
--------------------------
--------------------------
--------------------------
Fax: ( ) ____-_______
7.3 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the Parties relating to the matters contained herein, superseding all prior
contracts or agreements, whether oral or written, relating to the matters
contained herein.
7.4 TERMINATION OF ARTICLE II. The provisions of Article II of this
Agreement may be terminated by Xxxxx upon a Change of Control of Xxxxx.
7.5 AMENDMENT OR MODIFICATION. This Agreement may be amended or
modified from time to time only by the written agreement of all the Parties
hereto; provided,
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however, that the Partnership may not, without the prior approval of the
Conflicts Committee, agree to any amendment or modification of this Agreement
that, in the reasonable discretion of the General Partner, will adversely affect
the holders of Common Units. Each such instrument shall be reduced to writing
and shall be designated on its face an "Amendment" or an "Addendum" to this
Agreement.
7.6 ASSIGNMENT. No Party shall have the right to assign its rights or
obligations under this Agreement without the consent of the other Parties
hereto.
7.7 COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if all signatory parties had signed the
same document. All counterparts shall be construed together and shall constitute
one and the same instrument.
7.8 SEVERABILITY. If any provision of this Agreement shall be held
invalid or unenforceable by a court or regulatory body of competent
jurisdiction, the remainder of this Agreement shall remain in full force and
effect.
7.9 FURTHER ASSURANCES. In connection with this Agreement and all
transactions contemplated by this Agreement, each signatory party hereto agrees
to execute and deliver such additional documents and instruments and to perform
such additional acts as may be necessary or appropriate to effectuate, carry out
and perform all of the terms, provisions and conditions of this Agreement and
all such transactions.
7.10 RIGHTS OF LIMITED PARTNERS. The provisions of this Agreement are
enforceable solely by the Parties to this Agreement, and no Limited Partner of
the Partnership shall have the right, separate and apart from the Partnership,
to enforce any provision of this Agreement or to compel any Party to this
Agreement to comply with the terms of this Agreement.
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IN WITNESS WHEREOF, the Parties have executed this Agreement on, and
effective as of, the Closing Date.
XXXXX CORPORATION
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
NAVAJO PIPELINE CO., L.P.
BY NAVAJO PIPELINE GP, L.L.C.,
ITS GENERAL PARTNER
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
XXXXX LOGISTIC SERVICES, L.L.C.
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
HEP LOGISTIC HOLDINGS, L.P.
BY XXXXX LOGISTIC SERVICES, L.L.C.,
ITS GENERAL PARTNER
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
Signature Page to Omnibus Agreement
XXXXX ENERGY PARTNERS, L.P.
BY HEP LOGISTICS HOLDINGS, L.P.
ITS GENERAL PARTNER
BY XXXXX LOGISTIC SERVICES, L.L.C.
ITS GENERAL PARTNER
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
HEP LOGISTICS GP, L.L.C.
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
HEP OPERATING COMPANY, L.P.
BY HEP LOGISTICS GP, L.L.C.
ITS GENERAL PARTNER
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
Signature Page to Omnibus Agreement
SCHEDULE I
OPTION ASSETS OPTION ASSET OWNER
------------- ------------------
1. The 8-inch Artesia to Lovington intermediate products pipeline Navajo Pipeline Co., L.P.
2. The 10-inch Artesia to Lovington intermediate products pipeline Navajo Pipeline Co., L.P.
SCHEDULE I - 1
SCHEDULE II
PENDING LITIGATION
SCHEDULE II - 1
SCHEDULE III
GENERAL AND ADMINISTRATIVE SERVICES
(1) executive services
(2) finance and administration services
(3) information technology services
(4) legal services
(5) health, safety and environmental services
SCHEDULE III - 1
