EXECUTION COPY
EXHIBIT 99.8
CONTRIBUTION AGREEMENT
AMONG
PAA MANAGEMENT, L.P.
PLAINS RESOURCES INC.
AND
PLAINS ALL AMERICAN INC.
Dated as of June 8, 2001
TABLE OF CONTENTS
Page
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ARTICLE I. DEFINITIONS.................................................. 2
SECTION 1.01 Certain Defined Terms.................................. 2
ARTICLE II. CLOSING..................................................... 6
SECTION 2.01 Closing................................................ 6
SECTION 2.02 Deliveries at the Closing.............................. 7
SECTION 2.03 Simultaneous Deliveries................................ 7
SECTION 2.04 Sales and Transfer Taxes............................... 7
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF PARENT, PAAI............. 8
SECTION 3.01 Organization, Authority and Qualification.............. 8
SECTION 3.02 Capitalization of the Company; Ownership of the Units.. 9
SECTION 3.03 No Conflicts........................................... 10
SECTION 3.04 Governmental Consents and Approvals.................... 10
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF BUYER..................... 11
SECTION 4.01 Organization and Authority of Buyer.................... 11
SECTION 4.02 No Conflict............................................ 11
SECTION 4.03 Governmental Consents and Approvals.................... 11
SECTION 4.04 Investment Representations............................. 12
SECTION 4.05 Financing.............................................. 12
ARTICLE V. CONTRIBUTIONS................................................ 12
SECTION 5.01 Pre-Closing Events..................................... 12
SECTION 5.02 Closing Events......................................... 13
ARTICLE VI. CONDITIONS TO CLOSING....................................... 13
SECTION 6.01 Conditions to the Obligations of Each Party............ 13
SECTION 6.02 Conditions to the Obligations of Buyer................. 13
SECTION 6.03 Conditions to the Obligations of PAAI.................. 14
ARTICLE VII. TERMINATION AND WAIVER..................................... 14
SECTION 7.01 Termination............................................ 14
SECTION 7.02 Effect of Termination.................................. 15
ARTICLE VIII. GENERAL PROVISIONS........................................ 15
SECTION 8.01 Survival of Representations, Warranties and Covenants.. 15
Page
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SECTION 8.02 Notices................................................ 16
SECTION 8.03 Entire Agreement....................................... 16
SECTION 8.04 Headings............................................... 17
SECTION 8.05 Separability........................................... 17
SECTION 8.06 Assignment............................................. 17
SECTION 8.07 Amendment.............................................. 17
SECTION 8.08 Governing Law; Forum................................... 17
SECTION 8.09 Counterparts........................................... 17
SECTION 8.10 Specific Performance................................... 18
SECTION 8.11 Waiver of Jury Trial................................... 18
SECTION 8.12 Attorney's Fees........................................ 18
SECTION 8.13 Extensions, Waivers, Etc............................... 18
SECTION 8.14 Word Meanings.......................................... 18
CONTRIBUTION AGREEMENT
CONTRIBUTION AGREEMENT, dated as of June 8, 2001, among PAA Management,
L.P., a Delaware limited partnership ("BUYER"), Plains Resources Inc., a
Delaware corporation ("PARENT"), and Plains All American Inc., a Delaware
corporation and wholly owned subsidiary of Parent ("PAAI").
RECITALS:
WHEREAS, prior to the Closing, PAAI desires to (a) form Plains AAP, L.P., a
Delaware limited partnership ("NEWCO LP"), pursuant to the DLPA (as hereinafter
defined) and pursuant to the certificate of limited partnership attached to each
of the Unit Transfer and Contribution Agreements (as defined below) as Exhibit A
thereto (the "NEWCO LP CERTIFICATE") and the limited partnership agreement
attached to each of the Unit Transfer and Contribution Agreements (as defined
below) as Exhibit B thereto (the "INITIAL NEWCO LP AGREEMENT"), (b) form Plains
All American GP LLC, a Delaware limited liability company ("NEWCO GP LLC"),
pursuant to the Delaware Limited Liability Company Act and pursuant to the
limited liability company certificate attached to each of the Unit Transfer and
Contribution Agreements (as defined below) as Exhibit C thereto (the "NEWCO GP
LLC CERTIFICATE") and the limited liability company agreement attached to each
of the Unit Transfer and Contribution Agreements (as defined below) as Exhibit D
thereto (the "INITIAL NEWCO GP LLC AGREEMENT"), to act as the general partner of
Newco LP, and (c) contribute such percentage of incentive distribution rights
of Plains All American Pipeline, L.P., a Delaware limited partnership (the
"Company") (the "LLC INCENTIVE DISTRIBUTION RIGHTS") equal to one percent (1%)
of the aggregate fair market value of the GP Interest (as hereinafter defined),
the Operating Partnerships GP Interests (as hereinafter defined) and the
incentive distribution rights of the Company to Newco GP LLC, which will further
contribute the LLC Incentive Distribution Rights to Newco LP and (d) contribute
the GP Interest, the Operating Partnerships GP Interests and such percentage of
incentive distribution rights of the Company (the "LP INCENTIVE DISTRIBUTION
RIGHTS") equal to (i) one hundred percent, less (ii) the LLC Incentive
Distribution Rights, to NEWCO LP as its capital contribution as Newco LP's
limited partner;
WHEREAS, PAAI, as the initial member of Newco GP LLC, the general partner
of Newco LP, and as the initial limited partner of Newco LP desires at the
Closing to (a) amend and restate the Initial Newco GP LLC Agreement to be as set
forth in Exhibit E hereto (the "NEWCO GP LLC OPERATING AGREEMENT"), (b) to amend
and restate the Initial Newco LP Agreement to be as set forth in Exhibit F
hereto (the "NEWCO LP PARTNERSHIP AGREEMENT"), (c) to admit Buyer as a member of
Newco GP LLC with a Percentage Interest (as defined in the Newco GP LLC
Operating Agreement) of 2% of Newco GP LLC (the "BUYER NEWCO GP LLC INTEREST")
in exchange for an initial capital contribution of $15,000 that will then be
distributed to PAAI and (d) admit Buyer as a limited partner of Newco LP with a
Partnership Percentage (as defined in the Newco LP Partnership Agreement) of
1.98% of Newco LP (the "BUYER NEWCO LP INTEREST") in exchange for an initial
capital contribution of $1,485,000 that will then be distributed to PAAI;
WHEREAS, Seller, PAAI and Parent have previously entered into Unit Transfer
and Contribution Agreements (the "UNIT TRANSFER AND CONTRIBUTION AGREEMENTS")
with Sable
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Investments, L.P. ("SABLE INVESTMENTS"), Sable Holdings L.P. ("SABLE HOLDINGS"),
Kafu Holdings, LLC, E-Holdings III, L.P. ("E-HOLDINGS" and, together with Sable
Investments, Sable Holdings, Xxxxxx Hedgecap Fund, L.P., Xxxx X. Xxxxxx and Xxxx
X. Xxxxxxx, the "OTHER MEMBERS"); and
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, agreements
and covenants herein, the parties hereto hereby agree as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.01 Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ACTION" means any claim, action, suit, arbitration, inquiry, proceeding or
investigation by or before any Governmental Authority.
"AFFILIATE" means, with respect to any specified Person, any other Person
that directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person.
"AGREEMENT" or "THIS AGREEMENT" means this Agreement, dated as of June 8,
2001, among Buyer, Parent and PAAI and all amendments hereto made in accordance
with the provisions of Section 8.07.
"BUSINESS DAY" means any day that is not a Saturday, a Sunday or other day
on which banks are required or authorized by law to be closed in the City of New
York.
"BUYER" has the meaning specified in the introductory paragraph to this
Agreement.
"BUYER NEWCO GP LLC INTEREST" has the meaning specified in the recitals to
this Agreement.
"BUYER NEWCO LP INTEREST" has the meaning specified in the recitals to this
Agreement.
"CLASS B COMMON UNITS" shall mean the class B common units of the Company.
"CLOSING" has the meaning specified in Section 2.03.
"CLOSING DATE" has the meaning specified in Section 2.03.
"CODE" shall mean the Internal Revenue Code of 1986, as amended, and the
Regulations promulgated thereunder.
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"COMMON UNITS" shall mean the common units of the Company.
"COMPANY" has the meaning specified in the recitals to this Agreement.
"COMPANY PARTNERSHIP AGREEMENT" means the Second Amended and Restated
Agreement of Limited Partnership of the Company dated as of November 23, 1998,
as amended to the date of this Agreement.
"COMPANY SEC REPORTS" means all forms, registration statements, reports,
schedules, proxies or information statements and other information, statements
and other documents (including exhibits and amendments thereto) required to be
filed by the Company with the SEC since December 31, 1997.
"CONTROL" (including the terms "CONTROLLED BY" and "UNDER COMMON CONTROL
WITH"), with respect to the relationship between or among two or more Persons,
means the possession, directly or indirectly, or as trustee or executor, of the
power to direct or cause the direction of the affairs or management of a Person,
whether through the ownership of voting securities, as trustee or executor, by
contract or otherwise, including, without limitation, the ownership, directly or
indirectly, of securities having the power to elect a majority of the board of
directors or similar body governing the affairs of such Person.
"COURT" shall mean any court, tribunal, or other judicial or arbitral panel
of the United States, any foreign country, or any domestic or foreign state, and
any political subdivision or agency thereof.
"DLPA" means the Delaware Revised Uniform Limited Partnership Act.
"DISCLOSURE LETTER" means the disclosure letter delivered by Parent, PAAI
and Seller to Sable Holdings, Sable Investments, Kafu and E-Holdings on May 8,
2001.
"E-HOLDINGS" has the meaning specified in the recitals to this Agreement.
"ENCUMBRANCE" means any security interest, pledge, mortgage, lien
(including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, any defect or imperfection in title, preferential
arrangement or restriction, right to purchase, right of first refusal or other
burden or encumbrance of any kind.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"GP" means the general partner of the Company.
"GP INTEREST" means the ownership interest of the general partner in the
Company (in its capacity as general partner).
"GOVERNMENTAL AUTHORITY" means any United States federal, state, local or
any foreign government, governmental, regulatory or administrative authority,
agency or commission or any Court.
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"GOVERNMENTAL ORDER" means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.
"INCENTIVE DISTRIBUTION RIGHTS" means those certain limited partner
interests in the Company that confer on the holders thereof the right to cash
distributed by the Company pursuant to Sections 6.4(a)(iv), (v) and (vi) and
6.4(b)(ii), (iii) and (iv) of the Company Partnership Agreement.
"INITIAL NEWCO GP LLC AGREEMENT" has the meaning specified in the recitals
to this Agreement.
"INITIAL NEWCO LP AGREEMENT" has the meaning specified in the recitals to
this Agreement.
"INTRACOMPANY ARRANGEMENTS" means any transactions, arrangements,
agreements, commitments or understandings solely between the Company and any
wholly owned Company Subsidiaries (or Company Subsidiaries owned entirely by the
Company together with the GP) or among any of them.
"LAWS" shall mean all laws, statutes, ordinances, rulings and Regulations
of the United States, any foreign country, or any domestic or foreign state, and
any political subdivision or agency thereof, including all decisions of Courts
having the effect of law in each such jurisdiction.
"LIABILITIES" means any and all debts, liabilities and obligations, whether
accrued or fixed, absolute or contingent, matured or unmatured, or determined or
determinable, including, without limitation, those arising under any Law, Action
or Governmental Order, and those arising under any contract or agreement.
"LLC INCENTIVE DISTRIBUTION RIGHTS" has the meaning specified in the
recitals to this Agreement.
"LP INCENTIVE DISTRIBUTION RIGHTS" has the meaning specified in the
recitals to this Agreement.
"MATERIAL ADVERSE EFFECT" means any event, circumstance, condition,
development or occurrence causing, resulting in or having (or with the passage
of time likely to cause, result in or have) a material adverse effect on the
financial condition, business, assets, properties or results of operations of
the Company and the Company Subsidiaries taken as a whole, except to the extent
such effect is attributable to the execution of this Agreement and the
announcement thereof, but shall not include events, circumstances, conditions,
developments or occurrences that are generally applicable to (i) the midstream
segment of the oil and gas industry, (ii) the United States economy or (iii) the
United States security markets.
"MEMBER" has the meaning specified in the Newco GP LLC Operating Agreement.
"NEWCO GP LLC" has the meaning specified in the recitals to this Agreement.
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"NEWCO GP LLC CERTIFICATE" has the meaning specified in the recitals to
this Agreement.
"NEWCO GP LLC OPERATING AGREEMENT" has the meaning specified in the
recitals to this Agreement.
"NEWCO LP" has the meaning specified in the recitals to this Agreement.
"NEWCO LP CERTIFICATE" has the meaning specified in the recitals to this
Agreement.
"NEWCO LP PARTNERSHIP AGREEMENT" has the meaning specified in the recitals
to this Agreement.
"OPERATING PARTNERSHIPS" means Plains Marketing, L.P. and All American
Pipeline, L.P.
"OPERATING PARTNERSHIPS GP" means the general partner of each of the
Operating Partnerships.
"OPERATING PARTNERSHIPS GP INTERESTS" means, collectively, the 1.0101%
ownership interest of the Operating Partnerships GP in Plains Marketing, L.P.
and the .001% ownership interest of the Operating Partnerships GP in All
American Pipeline, L.P.
"OTHER MEMBERS" has the meaning specified in the recitals to this
Agreement.
"PARENT" has the meaning specified in the introductory paragraph to this
Agreement.
"PERCENTAGE INTEREST" has the meaning specified in the Newco GP LLC
Operating Agreement.
"PERSON" means any individual, partnership, corporation, limited liability
company, trust, incorporated or unincorporated organization or other legal
entity of any kind.
"REGULATION" shall mean any rule or regulation of any Governmental
Authority having the effect of law.
"PAAI" has the meaning specified in the introductory paragraph to this
Agreement.
"SABLE HOLDINGS" has the meaning specified in the recitals to this
Agreement.
"SABLE INVESTMENTS" has the meaning specified in the recitals to this
Agreement.
"SEC" means the United States Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"SELLER" has the meaning specified in the introductory paragraph to this
Agreement.
"SUBORDINATED UNITS" means the Subordinated Units of the Company.
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"SUBSIDIARY" means, with respect to any Person, any corporation,
partnership, association or other business entity of which (i) if a corporation,
a majority of the total voting power of shares of stock entitled (irrespective
of whether, at the time, stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the other Subsidiaries of that Person or a combination thereof,
or (ii) if a partnership, association or other business entity, a majority of
either (x) the partnership or other similar ownership interest thereof, or (y)
the stock or other equity interest of such partnership, association or other
business entity's general partner, managing member or similar controlling Person
is at the time owned or controlled, directly or indirectly, by such Person or
one or more Subsidiaries of that Person or a combination thereof.
"TAX" or "TAXES" means any and all taxes, fees, levies, duties, tariffs,
imposts, and other charges of any kind (together with any and all interest,
penalties, additions to tax and additional amounts imposed with respect thereto)
imposed by any government or taxing authority, including, without limitation:
taxes or other charges on or with respect to income, franchises, windfall or
other profits, gross receipts, property, sales, use, capital stock, payroll,
employment, social security, workers' compensation, unemployment compensation or
net worth; taxes or other charges in the nature of excise, withholding, ad
valorem, stamp, transfer, value added, or gains taxes; license, registration and
documentation fees; and customs duties, tariffs, and similar charges.
"TERMINATION DATE" has the meaning specified in Section 8.01(b).
"U.S. GAAP" means United States generally accepted accounting principles
and practices as in effect from time to time and applied consistently throughout
the periods involved.
"UNITS" means the Common Units, the Class B Common Units and the
Subordinated Units.
"VALUE ASSURANCE AGREEMENT" means the Value Assurance Agreement, by and
between Parent and Buyer, in the form attached to each of the Other Unit
Transfer and Contribution Agreements as Exhibit H.
ARTICLE II.
CLOSING
SECTION 2.01 Closing. The consummation of the transactions contemplated by
this Agreement (the "CLOSING") shall take place at the offices of Xxxxxx &
Xxxxxx L.L.P., 2300 First City Tower, 0000 Xxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000,
on June 8, 2001. The Closing may be postponed to such other date as the parties
hereto may mutually agree. The date on which the Closing occurs is referred to
in this Agreement as the "CLOSING DATE."
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SECTION 2.02 Deliveries at the Closing. At the Closing:
(a) Parent shall deliver, or cause to be delivered, to the Buyer the
following:
(i) such other documents, instruments and certificates as Buyer may
reasonably request in connection with the transactions contemplated by this
Agreement.
(b) PAAI shall deliver, or cause to be delivered, to Buyer the following:
(i) the Newco LP Partnership Agreement and the Newco GP LLC Operating
Agreement, executed by PAAI and the Other Members;
(ii) an executed copy of each of the Newco GP LLC Certificate, the
Initial Newco GP LLC Agreement, the Newco LP Certificate and the Initial
Newco LP Agreement, each as in effect as of the Closing Date;
(iii) documents reasonably acceptable to Buyer evidencing the transfer
of (A) the LLC Incentive Distribution Rights from PAAI to Newco GP LLC, (B)
the LLC Incentive Distribution Rights from Newco GP LLC to Newco LP, and
(C) the GP Interest, the Operating Partnerships GP Interests and the LP
Incentive Distribution Rights from PAAI to Newco LP; and
(iv) such other documents, instruments and certificates as the Buyer
may reasonably request in connection with the transactions contemplated by
this Agreement.
(c) The Buyer, as applicable, shall deliver, or cause to be delivered, the
following:
(i) to PAAI, the Newco LP Partnership Agreement and the Newco GP LLC
Operating Agreement, executed by Buyer; and
(ii) to Newco GP LLC and Newco LP, as the case may be, Buyer's initial
capital contribution under the Newco GP LLC Operating Agreement and the
Newco LP Partnership Agreement for Buyer Newco GP LLC Interest, and Buyer
Newco LP Interest.
SECTION 2.03 Simultaneous Deliveries. The delivery of the documents
required to be delivered at the Closing pursuant to this Agreement shall be
deemed to occur simultaneously. No delivery shall be effective until each party
hereto has received or waived receipt of all the documents that this Agreement
entitles such party to receive.
SECTION 2.04 Sales and Transfer Taxes. Any Taxes and any transfer,
recording or similar fees and charges arising out of or in connection with the
transactions contemplated by this Agreement shall be borne by Parent.
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ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF PARENT AND PAAI
Except as disclosed in the Disclosure Letter or in the Company SEC Reports
filed prior to the date hereof, each of Parent and PAAI, jointly and severally,
hereby represent and warrant to Buyer that:
SECTION 3.01 Organization, Authority and Qualification.
(a) The Company is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all
necessary power and authority to own, operate or lease the properties and assets
now owned, operated or leased by it and to carry on its business as it is
currently conducted and as it is now proposed to be conducted. The Company is
duly licensed or qualified as a foreign organization to do business and is in
good standing in each jurisdiction in which the properties owned or leased by it
or the operation of its business makes such licensing or qualification
necessary, except for such failures to be so licensed or qualified and in good
standing that would not have a Material Adverse Effect. Complete and correct
copies of the Certificate of Limited Partnership and the Company Partnership
Agreement, each as in effect on the date hereof, have been made available by the
Company to Buyer. The Company is not in default in any respect in the
performance, observation or fulfillment of any provision of its Certificate of
Limited Partnership or the Company Partnership Agreement.
(b) Parent is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all necessary power and
authority to own, operate or lease the properties and assets now owned, operated
or leased by it and to carry on its business as it is currently conducted and as
it is now proposed to be conducted. Parent has all necessary power and authority
to enter into this Agreement, to carry out its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby.
The execution and delivery of this Agreement by Parent, the performance by
Parent of its obligations hereunder and thereunder and the consummation by
Parent of the transactions contemplated hereby and thereby have been duly
authorized by all requisite action on the part of Parent and no other corporate
proceedings on the part of Parent are necessary to authorize this Agreement or
the consummation of the transactions contemplated hereby or thereby. This
Agreement has been duly executed and delivered by Parent, and (assuming due
authorization, execution and delivery by Buyer) this Agreement constitutes a
legal, valid and binding obligation of Parent enforceable against Parent in
accordance with its terms.
(c) PAAI is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all necessary power and
authority to own, operate or lease the properties and assets now owned, operated
or leased by it and to carry on its business as it is currently conducted and as
it is now proposed to be conducted. PAAI has all necessary power and authority
to enter into this Agreement and the Initial Newco LP Agreement, the Newco GP
LLC Operating Agreement and the Newco LP Partnership Agreement, to carry out its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement
and the Initial Newco GP LLC Agreement, the Initial Newco LP Agreement, the
Newco GP LLC Operating Agreement and the Newco LP
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Partnership Agreement by PAAI, the performance by PAAI of its obligations
hereunder and thereunder and the consummation by PAAI of the transactions
contemplated hereby and thereby have been duly authorized by all requisite
action on the part of PAAI and no other corporate proceedings on the part of
PAAI are necessary to authorize this Agreement or the Initial Newco GP LLC
Agreement, the Initial Newco LP Agreement, the Newco GP LLC Operating Agreement
or the Newco LP Partnership Agreement or the consummation of the transactions
contemplated hereby or thereby. This Agreement has been, and at the Closing the
Initial Newco GP LLC Agreement, the Initial Newco LP Agreement, the Newco GP LLC
Operating Agreement and the Newco LP Partnership Agreement shall be, duly
executed and delivered by PAAI, and (assuming due authorization, execution and
delivery by Buyer) this Agreement constitutes, and the Initial Newco GP LLC
Agreement, the Initial Newco LP Agreement, the Newco GP LLC Operating Agreement
and Newco LP Partnership Agreement shall constitute, a legal, valid and binding
obligation of PAAI enforceable against PAAI in accordance with its terms.
(d) As of the Closing Date, Newco LP shall be a limited partnership duly
organized, validly existing and in good standing under the laws of the State of
Delaware and shall have all necessary power and authority to own, operate or
lease its properties and assets owned, operated or leased by it as of the
Closing Date and to carry on its business as it is then proposed to be
conducted. As of the Closing Date, Newco GP LLC shall be a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware and shall have all necessary power and authority to own,
operate or lease its properties and assets owned, operated or leased by it as of
the Closing Date and to carry on its business as it is then proposed to be
conducted.
SECTION 3.02 Capitalization of the Company; Ownership of the Units. As of
the date of this Agreement, (i) 23,049,239 Common Units, (ii) 1,307,190 Class B
Common Units, (iii) 10,029,619 Subordinated Units, (iv) the GP Interest, and (v)
the Operating Partnerships GP Interests are issued and outstanding, all of which
(a) are duly authorized, validly issued, fully paid and nonassessable, and (b)
were issued in compliance with all applicable state and federal securities laws
and the Company Partnership Agreement or the Operating Partnerships Agreements
(as applicable). None of the issued and outstanding Units, Incentive
Distribution Rights, GP Interest or Operating Partnerships GP Interests were
issued in violation of any preemptive rights. PAAI is the holder of 100% of the
Incentive Distribution Rights. Except as set forth in Section 3.02 of the
Disclosure Letter, or as relates to Intracompany Arrangements, there are no (i)
options, warrants, convertible securities, subscriptions, stock appreciation
rights, phantom equity, or other rights, agreements, arrangements or commitments
of any character (including "rights plans" or "poison pills") relating to the
Units, the Incentive Distribution Rights, the GP Interest or Operating
Partnerships GP Interests or obligating the Company to issue, transfer or sell
any Units, Incentive Distribution Rights or any other interest in, the Company,
(ii) outstanding contractual obligations of the Company to repurchase, redeem or
otherwise acquire any Units, the Incentive Distribution Rights, the GP Interest
or any interest in any Company Subsidiary or to provide funds to, or make any
investment (in the form of a loan, capital contribution or otherwise) in, any
other Person or (iii) outstanding contractual obligations to register the GP
Interest, any Units or instruments convertible or exchangeable into Units or
Operating Partnerships GP Interests. Except as set forth in Section 3.02 of the
Disclosure Letter, or as relates to Intracompany Arrangements, there are no
voting trusts, voting agreements,
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proxies or other agreements in effect with respect to the voting or transfer of
the GP Interest or Operating Partnerships GP Interests or any Units binding upon
Parent, PAAI or the Company or to which Parent, PAAI or the Company is a party,
except those contemplated or required by this Agreement.
SECTION 3.03 No Conflicts. Except as disclosed in Section 3.03 of the
Disclosure Letter, assuming that all consents, approvals, authorizations and
other actions described in Section 3.04 have been obtained and all filings,
approvals and notifications listed in Section 3.04 of the Disclosure Letter have
been made or obtained, the execution, delivery and performance of this Agreement
by Parent and PAAI, the Registration Rights Agreement by the Company, the Value
Assurance Agreement, and the Initial Newco GP LLC Agreement, Initial Newco LP
Agreement, Newco GP LLC Operating Agreement and Newco LP Partnership Agreement
by PAAI, do not and will not (a) violate or conflict with or result in a breach
of any provision of the Certificate of Incorporation or Bylaws or similar
organizational documents (including the Company Partnership Agreement) of
Parent, PAAI, the Company or any Company Subsidiary, (b) violate or conflict
with any Law or Governmental Order applicable to Parent, PAAI, the Company or
any Company Subsidiary or any of their respective assets and properties, or
violate any rule or regulation of the New York Stock Exchange or the American
Stock Exchange, or (c) conflict with, result in any violation or breach of or
constitute a default (or an event which, with the giving of notice or lapse of
time, or both, would become a default) under, require any notice or consent
under, or give to others any rights of termination, amendment, acceleration or
cancellation of, or result in any loss of any benefit, the triggering of any
payment by, or the increase in any other obligation of, Parent, PAAI, the
Company or any Company Subsidiary or the creation of any Encumbrance on any
assets or properties of Parent, PAAI, the Company or any Company Subsidiary
pursuant to any material contract, license, permit, franchise or other
instrument or arrangement to which Parent, PAAI, the Company or any Company
Subsidiary is a party or by which any of them, or any of such assets or
properties is bound or affected, except for, in the case of clauses (b) and (c),
such conflicts, violations, breaches, defaults or other occurrences which would
not (i) have a Material Adverse Effect, (ii) impair, in any material respect,
the ability of Parent, PAAI and Seller to perform their obligations under this
Agreement or (iii) prevent or materially delay the consummation of any of the
transactions contemplated hereby.
SECTION 3.04 Governmental Consents and Approvals. Except as disclosed in
Section 3.06 of the Disclosure Letter, the execution, delivery and performance
of this Agreement by Parent and PAAI and the Initial Newco GP LLC Agreement,
Initial Newco LP Agreement, Newco GP LLC Operating Agreement and Newco LP
Partnership Agreement by PAAI, do not and will not require any consent, waiver,
approval, authorization or other order of, action by, filing with or
notification to, any Governmental Authority, except (a) the requirements of the
Securities Act, the Exchange Act, state securities or blue sky laws, the New
York Stock Exchange and the American Stock Exchange, and (b) any other consent,
approval, authorization, filing or notice the failure of which to make or obtain
would not (i) have a Material Adverse Effect, (ii) impair, in any material
respect, the ability of Parent and PAAI to perform its obligations under this
Agreement, or (iii) prevent or materially delay the consummation of any of the
transactions contemplated hereby.
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ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants jointly and severally, to Parent, PAAI
and Seller as follows:
SECTION 4.01 Organization and Authority of Buyer. Buyer is a limited
partnership duly organized, validly existing and in good standing under the laws
of Delaware, and has all necessary power and authority to carry on its business
as it is currently conducted. Buyer has all necessary power and authority to
enter into this Agreement, to carry out its obligations hereunder and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by Buyer, the performance by Buyer of its obligations hereunder
and the consummation by Buyer of the transactions contemplated hereby have been
duly authorized by all requisite action on the part of Buyer and no other
proceedings on the part of Buyer are necessary to authorize this Agreement or
the consummation of the transactions contemplated hereby. This Agreement has
been duly executed and delivered by Buyer, and (assuming due authorization,
execution and delivery by Parent and PAAI) this Agreement constitutes a legal,
valid and binding obligation of Buyer enforceable against it in accordance with
its terms.
SECTION 4.02 No Conflict. Assuming the making and obtaining of all filings,
notifications, consents, approvals, authorizations and other actions referred to
in Section 4.03, except as may result from any facts or circumstances relating
solely to Parent and PAAI, the execution, delivery and performance of this
Agreement by Buyer does not and will not (a) violate, conflict with or result in
the breach of any provision of the organizational documents of Buyer, (b)
conflict with or violate any Law or Governmental Order applicable to Buyer or by
which any property or asset of it is bound or (c) conflict with, result in any
breach of or constitute a default (or an event which, with the giving of notice
or lapse of time, or both, would become a default) under, require any consent
under, or give to others any rights of termination, amendment or cancellation
of, any note, bond, mortgage or indenture, contract, agreement, lease, sublease,
license, permit, franchise or other instrument or obligation to which Buyer is a
party or by which any of such assets or properties are bound or affected, except
for, in the case of clauses (b) and (c), conflicts, violations, breaches or
defaults which would not prevent or materially delay the consummation of the
transactions contemplated hereby.
SECTION 4.03 Governmental Consents and Approvals. Except for (a) applicable
requirements, if any, of the Exchange Act, and (b) as would not prevent or
materially delay the consummation of the transactions contemplated hereby, Buyer
is not required to submit any notice, report or other filing with any
Governmental Authority, in connection with the execution, delivery or
performance of this Agreement or the consummation of the transactions
contemplated hereby. No waiver, consent, approval or authorization of any
Governmental Authority is required to be obtained or made by Buyer in connection
with their execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby, except where the failure
to obtain such waivers, consents, approvals or authorizations would not prevent
or materially delay the consummation of the transactions contemplated hereby.
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SECTION 4.04 Investment Representations.
(a) Buyer understands that the Incentive Distribution Rights, the Buyer
Newco GP LLC Interest and the Buyer Newco LP Interest have not been registered
under the Securities Act or the securities laws of any state and that the Buyer
Newco GP LLC Interest and the Buyer Newco LP Interest cannot be resold unless
they are subsequently registered under the Securities Act or applicable
securities laws of any state, or an exemption from registration is available.
(b) Buyer is an "accredited investor" as such term is defined in Rule
501(a) of Regulation D under the Securities Act.
(c) Buyer has had an opportunity to ask questions and receive answers from
PAAI and the Company regarding the terms and conditions of the acquisition of
the Buyer Newco GP LLC Interest, the Buyer Newco LP Interest and the business,
properties, prospects and financial condition of the Company.
(d) Buyer is acquiring the Buyer Newco GP LLC Interest, and the Buyer Newco
LP Interest to be purchased by it under this Agreement for its own account, for
its own investment and not with a view to the distribution thereof within the
meaning of the Securities Act.
SECTION 4.05 Financing. At the Closing Date, Buyer will have funds
available to it sufficient to consummate the transactions contemplated hereby.
ARTICLE V.
CONTRIBUTIONS
SECTION 5.01 Pre-Closing Events. Prior to the Closing, PAAI shall (i) form
Newco LP pursuant to the DLPA, the Newco LP Certificate, and the Initial Newco
LP Agreement, (ii) form Newco GP LLC pursuant to the Delaware Limited Liability
Company Act, the Newco GP LLC Certificate and the Initial Newco GP LLC
Agreement, to act as the general partner of Newco LP, (iii) contribute the LLC
Incentive Distribution Rights to Newco GP LLC, which shall promptly contribute
the LLC Incentive Distribution Rights to Newco LP, and (iv) contribute the GP
Interest, the Operating Partnerships GP Interests, and the LP Incentive
Distribution Rights to Newco LP as its capital contribution as Newco LP's
limited partner.
SECTION 5.02 Closing Events.
(a) At the Closing, PAAI shall (i) amend and restate the Initial Newco GP
LLC Agreement to be as set forth in the Newco GP LLC Operating Agreement, (ii)
amend and restate the Initial Newco LP Agreement to be as set forth in the Newco
LP Partnership Agreement, (iii) cause the admission of Buyer as a member of
Newco GP LLC with the Buyer Newco GP LLC Interest in exchange for an initial
capital contribution of $15,000 by Buyer that shall then be distributed to PAAI,
and (iv) cause the admission of Buyer as a limited partner of Newco LP with the
Buyer Newco LP Interest in exchange for an initial capital contribution of
$1,485,000 by Buyer that shall then be distributed to PAAI
(b) At the Closing, each of PAAI and Buyer shall execute and deliver the
Newco LP Partnership Agreement and the Newco GP LLC Operating Agreement.
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ARTICLE VI.
CONDITIONS TO CLOSING
SECTION 6.01 Conditions to the Obligations of Each Party. The obligations
of Parent, PAAI, Seller, and Buyer to consummate the transactions contemplated
hereby are subject to the satisfaction or waiver, in whole or in part (where
permissible by applicable law), at or prior to the Closing, of each of the
following conditions:
(a) no Governmental Authority or court of competent jurisdiction shall have
enacted, issued, promulgated, enforced or entered any Law or Governmental Order
which is then in effect making the consummation of the transactions contemplated
hereby illegal or otherwise prohibiting the consummation of the transactions
contemplated hereby; and
(b) the Pre-Closing Events specified in Section 5.01 and the Closing Events
specified in Section 5.02 shall have occurred.
SECTION 6.02 Conditions to the Obligations of Buyer. The obligations of the
Buyer to consummate the transactions contemplated hereby are subject to the
satisfaction of the following additional conditions, unless waived by the Buyer
in writing:
(a) (i) The representations and warranties of Parent and PAAI set forth in
this Agreement, when read without any exception or qualification as to
materiality or reference to Material Adverse Effect, shall be true and correct
as of the date of this Agreement and as of the Closing (except as to any such
representation and warranty which speaks as of a specific date, which shall be
true and correct as of such date) except where the failure to be so true and
correct would not individually or in the aggregate reasonably be expected to
have a Material Adverse Effect; and (ii) Parent and PAAI shall have performed
all other obligations and complied with all other agreements and covenants of
Parent and PAAI to be performed or complied with by them under this Agreement
prior to the Closing in each case in all material respects.
(b) Parent and PAAI shall have obtained all approvals and consents
necessary or required for the consummation of the transactions contemplated by
this Agreement, except for those approvals and consents the failure of which to
obtain would not have a Material Adverse Effect.
(c) Buyer shall have received the agreements referred to in Sections 2.02
(a) and (b) executed by all parties thereto (except the Buyer).
SECTION 6.03 Conditions to the Obligations of PAAI The obligations of PAAI
to consummate the transactions contemplated hereby are subject to the
satisfaction of the following additional conditions, unless waived by Parent and
PAAI in writing:
(a) The representations and warranties of Buyer set forth in this
Agreement, when read without any exception or qualification as to materiality,
shall be true and correct as of the date of this Agreement and as of the Closing
(except as to any such representation and warranty which speaks as of a specific
date, which shall be true and correct as of such date) except where the failure
to be so true and correct would (x) not prevent or materially delay the
consummation of the transactions contemplated hereby or (y) have a material
adverse effect on the Company's ability to conduct its business after the
Closing; and (ii) Buyer shall have performed all
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obligations and complied with all agreements and covenants of Buyer to be
performed or complied with by it under this Agreement prior to the Closing in
each case in all material respects.
(b) Parent and PAAI shall have received the agreements referred to in
Section 2.02 (c) executed by all parties thereto (except Parent and PAAI).
ARTICLE VII.
TERMINATION AND WAIVER
SECTION 7.01 Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time prior to the
Closing:
(a) by the mutual written consent of Parent, PAAI and Buyer;
(b) by either Parent, PAAI or Buyer if the Closing shall not have occurred
on or before July 6, 2001 (the "TERMINATION DATE"), provided that the party
seeking to terminate this Agreement pursuant to this Section 7.01(b) shall not
have breached in any material respect its obligations under this Agreement in
any manner that shall have proximately contributed to the failure to consummate
the transactions contemplated hereby on or before the Termination Date;
(c) by Parent, if (i) there has been a breach by Buyer of any
representation or warranty of Buyer contained in this Agreement which would
reasonably be expected to have a Material Adverse Effect on the Company's
ability to conduct its business after the Closing and which by its nature or
timing cannot be cured prior to the Termination Date, or prevent or delay the
consummation of the transactions contemplated hereby beyond the date specified
in Section 7.01(b), or (ii) there has been a breach of any of the covenants or
agreements set forth in this Agreement on the part of Buyer, which would
reasonably be expected to have a Material Adverse Effect on the Company's
ability to conduct its business after the Closing and which by its nature or
timing cannot be cured prior to the Termination Date, or prevent or delay the
consummation of the transactions contemplated hereby beyond the date specified
in Section 7.01(b), provided, that Parent may not terminate this Agreement
pursuant to this Section 7.01(c) if Parent, PAAI or Seller shall be in material
breach of any of their representations, warranties, covenants or agreements
hereunder;
(d) by either Parent and PAAI or Buyer if any Governmental Authority or
court of competent jurisdiction shall have enacted, issued, promulgated,
enforced or entered any Law or Governmental Order making the consummation of the
transactions contemplated hereby illegal or otherwise prohibiting the
transactions contemplated thereby and such Governmental Order shall have become
final and nonappealable, provided that the party seeking to terminate this
Agreement shall have used its reasonable best efforts to remove or lift such
Governmental Order; or
(e) by Buyer, if (i) there has been a breach by Parent or PAAI of any
representation or warranty of Parent and PAAI contained in this Agreement which
would reasonably be expected to have a Material Adverse Effect and which by its
nature or timing cannot be cured prior to the
14
Termination Date, or prevent or delay the consummation of the transactions
contemplated hereby beyond the date specified in Section 7.01(b), or (ii) there
has been a breach of any of the covenants or agreements set forth in this
Agreement on the part of Parent or PAAI, which could reasonably be expected to
have a Material Adverse Effect and which by its nature or timing cannot be cured
prior to the Termination Date or prevent or delay the consummation of the
transactions contemplated hereby beyond the date specified in Section 7.01(b),
provided, that Buyer may not terminate this Agreement pursuant to this Section
7.01(e) if Buyer shall be in material breach of any of their representations,
warranties, covenants or agreements hereunder.
The party desiring to terminate this Agreement pursuant to Section 7.01(a)
through (e) shall give written notice of such termination to the other party in
accordance with Section 8.02.
SECTION 7.02 Effect of Termination. In the event of termination of the
Agreement pursuant to this Article VIII, all obligations of the parties shall
terminate, except the obligations of the parties pursuant to this Section 7.02.
ARTICLE VIII.
GENERAL PROVISIONS
SECTION 8.01 Survival of Representations, Warranties and Covenants.
(a) The representations and warranties of the parties contained in this
Agreement shall not survive the Closing Date.
(b) The covenants and agreements of the parties to be performed after the
Closing Date contained in this Agreement shall survive the Closing Date.
SECTION 8.02 Notices. All notices or communications hereunder shall be in
writing (including facsimile or similar writing) addressed as follows:
(a) To Parent or PAAI:
Plains Resources Inc.
000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxx Xxxxxxxx
with a copy to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxx X. Xxxxxx
15
(b) To Buyer:
PAA Management, L.P.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxx X. Xxxxxxxxx
with a copy to:
PAA Management LLC
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxx Xxxxx
Any such notice or communication shall be deemed given (i) when made, if made by
hand delivery, and upon confirmation of receipt, if made by facsimile, (ii) one
Business Day after being deposited with a next day courier, postage prepaid, or
(iii) three Business Days after being sent certified or registered mail, return
receipt requested, postage prepaid, in each case addressed as above (or to such
other address as such party may designate in writing from time to time).
SECTION 8.03 Entire Agreement. This Agreement, the Value Assurance
Agreement and the confidentiality obligations under the Confidentiality
Agreement represent the entire agreement of the parties with respect to the
subject matter hereof and shall supersede any and all previous contracts,
arrangements or understandings between the parties hereto with respect to the
subject matter hereof.
SECTION 8.04 Headings. The descriptive headings contained in this Agreement
are included for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 8.05 Separability. If any provision of this Agreement shall be
declared to be invalid or unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof which shall
remain in full force and effect.
SECTION 8.06 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the parties hereto, which consent
may be granted or withheld in the sole discretion of the parties. Subject to the
preceding sentence, this Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns.
Nothing in this Agreement, express or implied, is intended to confer on any
Person other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations or liabilities under or by reason of this
Agreement.
SECTION 8.07 Amendment. This Agreement may not be amended or modified
except (a) by an instrument in writing signed by each of, or on behalf of each
of, the parties or (b) by a waiver in accordance with Section 8.13. This
Agreement may be amended or
16
supplemented in writing by the parties hereto with respect to any of the terms
contained in this Agreement.
SECTION 8.08 Governing Law; Forum. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Texas applicable to
contracts executed in and to be performed in that state and without regard to
any applicable conflicts of law. All actions and proceedings arising out of or
relating to this Agreement shall be heard and determined in any Texas state or
federal Court located in Houston, Texas. In connection with the foregoing, each
of the parties to this Agreement irrevocably (a) consents to submit itself to
the personal jurisdiction of the state and federal Courts of competent
jurisdiction located in Houston, Texas, (b) agrees that it will not attempt to
deny or defeat such personal jurisdiction by motion or other request for leave
from any such Court, and (c) hereby consents to service of process pursuant to
the notice provisions set forth in Section 8.02.
SECTION 8.09 Counterparts. This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
and delivered shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement.
SECTION 8.10 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
SECTION 8.11 Waiver of Jury Trial. Each of the parties hereto irrevocably
and unconditionally waives all right to trial by jury in any action, proceeding
or counterclaim (whether based in contract, tort or otherwise) arising out of or
relating to this Agreement or the actions of the parties hereto in the
negotiation, administration, performance and enforcement thereof.
SECTION 8.12 Attorney's Fees. If any action at law or equity, including an
action for declaratory relief, is brought to enforce or interpret any provision
of this Agreement, the prevailing party shall be entitled to recover reasonable
attorney's fees and expenses from the other party, which fees and expenses shall
be in addition to any other relief which may be awarded.
SECTION 8.13 Extensions, Waivers, Etc. At any time prior to the Closing,
either party may:
(a) extend the time for the performance of any of the obligations or act of
the other party;
(b) waive any inaccuracies in the representations and warranties of the
other party contained herein or in any document delivered pursuant hereto; or
(c) waive compliance with any of the agreements or conditions of the other
party contained herein.
17
Notwithstanding the foregoing, no failure or delay by Parent, PAAI, or
Buyer in exercising any right hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right hereunder. Any agreement on
the part of a party hereto to any such extension or waiver shall be valid only
if set forth in an instrument in writing signed on behalf of such party.
SECTION 8.14 Word Meanings. The words such as "herein", "hereinafter",
"hereof" and "hereunder" refer to this Agreement as a whole and not merely a
subdivision in which such words appear unless the context otherwise requires.
The singular shall include the plural, and vice-versa, unless the context
otherwise requires. Whenever the words "include", "includes" or "including" are
used in this Agreement, they shall be deemed to be followed by the words
"without limitation." When verbs are used as nouns, the nouns correspond to such
verbs and vice-versa. The worlds "material" and "materiality" shall have a
correlative meaning to Material Adverse Effect.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above by their respective officers
thereunto duly authorized.
PLAINS RESOURCES INC.
By: /s/ XXXXX X. XXXXXX
------------------------------------------
Name: Xxxxx X. Xxxxxx
-------------------------------------
Title: Chairman and Chief Executive Officer
-------------------------------------
PLAINS ALL AMERICAN INC.
By: /s/ XXXX X. XXXXXXXXX
------------------------------------------
Name: Xxxx X. Xxxxxxxxx
-------------------------------------
Title: Chief Executive Officer
------------------------------------
PAA MANAGEMENT, L.P.
By: PAA Management LLC,
its general partner
By: /s/ XXXX X. XXXXXXXXX
------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Managing Member
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