Exhibit 10.6
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AGREEMENT FOR THE RELEASE
OF CERTAIN INDEMNIFICATION OBLIGATIONS
UNDER THE FOLLOWING AGREEMENTS:
PURCHASE AGREEMENT, dated April 18, 2003, as further amended, by and
among, Xxxxxxxx Energy Services, LLC, Xxxxxxxx Natural Gas Liquids, Inc, and
Xxxxxxxx XX LLC and Magellan Midstream Holdings, L.P. (formerly known as WEG
Acquisitions, L.P.);
CONTRIBUTION AGREEMENT, dated April 11, 2002, by and among, Xxxxxxxx
Energy Services, LLC, Xxxxxxxx XX LLC and Magellan Midstream Partners, L.P.
(formerly known as Xxxxxxxx Energy Partners L.P.); and
NEW OMNIBUS AGREEMENT, dated June 17, 2003, as amended, by and among
Magellan Midstream Holdings, L.P. (formerly known as WEG Acquisitions, L.P.),
Xxxxxxxx Energy Services, LLC, Xxxxxxxx Natural Gas Liquids, Inc. and The
Xxxxxxxx Companies, Inc.
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AGREEMENT FOR THE RELEASE
OF CERTAIN INDEMNIFICATION OBLIGATIONS
THIS AGREEMENT (the "Agreement") is entered into on, and effective as of May 26,
2004 by and among Magellan Midstream Holdings, L.P. ("MMH"), Magellan GP, LLC
("Magellan GP") and Magellan Midstream Partners, L.P. ("MMP, " and together with
MMH and Magellan GP, the "Magellan Parties"), on the one hand, and The Xxxxxxxx
Companies, Inc. ("Xxxxxxxx"), Xxxxxxxx Energy Services, LLC ("XXX"), Xxxxxxxx
Natural Gas Liquids, Inc. ("WNGL") and Xxxxxxxx XX LLC ("Xxxxxxxx XX," and
together with Xxxxxxxx, XXX and WNGL, the "Xxxxxxxx Parties"), on the other
hand, with respect to the following agreements, collectively, the "Subject
Agreements":
NEW OMNIBUS AGREEMENT, dated June 17, 2003 (as amended, the "New Omnibus
Agreement"), by and among MMH (formerly known as WEG Acquisitions, L.P.),
XXX, WNGL and Xxxxxxxx;
CONTRIBUTION AGREEMENT, dated April 11, 2002 (the "Contribution
Agreement"), by and among, XXX, Xxxxxxxx XX and MMP (formerly known as
Xxxxxxxx Energy Partners L.P.); and
PURCHASE AGREEMENT, dated April 18, 2003, as amended by Amendment No. 1,
dated May 5, 2003 and Amendment No. 2, dated January 6, 2004 (as amended,
the "Purchase Agreement"), by and among XXX, WNGL, Xxxxxxxx XX and MMH.
RECITALS
WHEREAS, pursuant to the New Omnibus Agreement, the Contribution Agreement and
the Purchase Agreement, the Xxxxxxxx Parties have certain obligations to
indemnify, defend and hold harmless the Magellan Parties; and
WHEREAS, in consideration of the payments to be made by the Xxxxxxxx Parties, in
accordance herewith, the Magellan Parties are willing to release the Xxxxxxxx
Parties from (i) certain obligations of indemnification that are set out in the
Subject Agreements, except as specifically provided herein and (ii) liabilities
that are environmental in nature that relate to the assets, businesses or
properties of the Magellan Parties as more specifically described herein; and
WHEREAS, currently with execution of this Agreement, the parties to the Purchase
Agreement have executed Amendment No. 3 thereto, which provides for the
reduction of the indemnification "cap" contained in Section 8.2(d)(i) thereof
from $175 million to $160 million.
NOW, THEREFORE, in consideration of the mutual terms, conditions and other
agreements as set forth herein, the parties hereto hereby agree to as follows:
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ARTICLE I
COMPENSATION
Section 1.1 Compensation
(a) As consideration for the release by the Magellan Parties and
their respective affiliates, successors and assigns of certain indemnity
obligations as more specifically set forth herein, Xxxxxxxx, WNGL, XXX and
Xxxxxxxx XX, each hereby agree to pay to MMP One Hundred Seventeen Million Five
Hundred Thousand Dollars, $117,500,000 (the "Aggregate Payment") in four annual
payments, as follows:
(i) the first payment of $35,000,000 shall be paid on or
before July 1, 2004;
(ii) the second payment of $27,500,000 shall be paid on or
before July 1, 2005;
(iii) the third payment of $20,000,000 shall be paid on or
before July 1, 2006; and
(iv) the fourth payment of $35,000,000 shall be paid on or
before July 1, 2007.
(b) In the event that the Magellan Parties collect third-party
receivables pursuant to Section 5.4(b), an amount equal to 50% of the amounts
collected, in each case, net of any and all out-of-pocket costs and expenses
paid to third parties by the Magellan Parties, (i) shall be subtracted from the
amount due on the upcoming payment date and (ii) be added to the amount due on
the final payment date.
(c) In the event that Xxxxxxxx, WNGL, XXX or Xxxxxxxx XX does not
make the annual payments specified under Section 1.1(a) above on or before the
designated due date therefor, such amount shall accrue interest at an annual
rate of 9.0% from the due date until the date of payment. If the payment due
date does not fall on a business day, such due date shall be the first business
day succeeding such date.
Section 1.2 Payment Procedure
Each payment specified under Section 1.1(a) above shall be paid by wire
transfer to MMP of immediately available funds made to a bank in the United
States of America, as designated in writing by MMP not less than three business
days in advance of the date specified for the applicable payment.
Section 1.3 Use of funds
MMP shall be responsible for all known environmental liabilities
associated with the assets, business or properties of the Magellan Parties as
provided herein and shall use the funds
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received from Xxxxxxxx hereunder, or an equivalent amount otherwise on hand or
available through debt agreements or capital markets, for such purposes.
ARTICLE II
XXXXXXXX PARTIES' REPRESENTATIONS AND WARRANTIES
Section 2.1 Validity of Agreement: Authorization
Each of the Xxxxxxxx Parties has the power and authority to enter into
this Agreement and to carry out its obligations hereunder. No further
proceedings on the part of any of the Xxxxxxxx Parties are necessary to
authorize such execution, delivery and performance of this Agreement. This
Agreement has been duly executed and delivered by each of the Xxxxxxxx Parties
and constitutes a valid and binding obligation enforceable against each of the
Xxxxxxxx Parties in accordance with its terms (except to the extent that its
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or other similar law affecting the enforcement of creditors'
rights generally or by general equitable principles).
Section 2.2 Consents and Approvals
No consent, approval, waiver or authorization of, or filing, registration
or qualification with, any Governmental Authority or any other Person on the
part of Xxxxxxxx Parties is required to execute and deliver this Agreement or to
perform its respective obligations hereunder.
Section 2.3 Solvency
Each of the Xxxxxxxx Parties is, and immediately after entering into this
Agreement will be, Solvent. For purposes of this Agreement, "Solvent" means,
with respect to the applicable party on the date of this Agreement, that (a) the
fair value of the property of such party is greater than the total amount of
liabilities, including, without limitation, contingent liabilities of such party
that would constitute liabilities under GAAP, (b) the present fair saleable
value of the assets of such party is not less than the amount that will be
required to pay its debts as they become absolute and matured, taking into
account the possibility of refinancing such obligations and selling assets, (c)
such party does not intend to, and does not believe that it will, incur debts or
liabilities beyond such party's ability to pay such debts as they mature taking
into account the possibility of refinancing such obligations and selling assets
and (d) such party is not engaged in business or a transaction, and does not
intend to engage in business or a transaction, for which such party's property
remaining after such transaction would constitute unreasonably small capital.
Section 2.4 No Conflict or Violation
The execution, delivery and performance of this Agreement by any of the
Xxxxxxxx Parties does not and will not: (a) violate or conflict with any
provision of the certificates of incorporation, by-laws, certificates of
formation, limited liability company operating agreements, partnership or
limited partnership agreements or other formation or governing documents of
Xxxxxxxx Parties; (b) violate any applicable provision of law, statute,
judgment, order, writ, injunction, decree, award, rule, or regulation of any
foreign, federal, tribal, state or local
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government, court, arbitrator, agency or commission or other governmental or
regulatory body or authority ("Governmental Authority"); (c) violate, result in
a breach of, constitute (with due notice or lapse of time or both) a default or
cause any obligation, penalty or premium to arise or accrue under any material
contract, lease, loan agreement, mortgage, security agreement, trust indenture
or other agreement or instrument to which any of the Xxxxxxxx Parties is a party
or by which any of them is bound.
Section 2.5 Insurance
Set forth on Schedule 2.5(a) hereto is a complete and accurate list of all
policies of insurance currently maintained by the Xxxxxxxx Parties which were
purchased to provide coverage solely for the business, assets and properties of
the Magellan Parties, as described in the "Prospectus" (as defined in the New
Omnibus Agreement), for which a Xxxxxxxx Party or an affiliate is the named
insured or is an additional named insured (the "MMP Policies). To Xxxxxxxx'
Knowledge, no notice of cancellation has been given with respect to any such MMP
Polices and all premiums due on each MMP Policy have been paid in a timely
manner. The Magellan Parties have been provided with copies of all of the MMP
Policies including all endorsements, riders and other amendments in the
possession of the Xxxxxxxx Parties that define, limit or modify coverage. The
term "Xxxxxxxx' Knowledge" as used in this Section 2.5 means the actual
knowledge of the person(s) identified on Schedule 2.5(b) hereto, without
independent inquiry.
ARTICLE III
MAGELLAN PARTIES' REPRESENTATIONS AND WARRANTIES
Section 3.1 Validity of Agreement: Authorization
Each of the Magellan Parties has the power and authority to enter into
this Agreement and to carry out its obligations hereunder. The execution and
delivery of this Agreement and the performance of each of the Magellan Parties
obligations hereunder have been duly authorized by the Board of Directors and
members, as applicable, and no other proceedings on the part of any of the
Magellan Parties is necessary to authorize such execution, delivery and
performance. This Agreement has been duly executed and delivered by each of the
Magellan Parties and constitutes a valid and binding obligation enforceable
against each of the Magellan Parties in accordance with its terms (except to the
extent that its enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar law affecting the enforcement of
creditors' rights generally or by general equitable principles).
Section 3.2 Consents and Approvals
No consent, approval, waiver or authorization of, or filing, registration
or qualification with, any Governmental Authority or any other Person on the
part of Magellan Parties is required to execute and deliver this Agreement or to
perform its respective obligations hereunder.
Section 3.3 No Conflict or Violation
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The execution, delivery and performance of this Agreement by any of the
Magellan Parties does not and will not: (a) violate or conflict with any
provision of the certificates of incorporation, by-laws, certificates of
formation, limited liability company operating agreements, partnership or
limited partnership agreements or other formation or governing documents of
Magellan Parties; (b) violate any applicable provision of law, statute,
judgment, order, writ, injunction, decree, award, rule, or regulation of any
Governmental Authority; (c) violate, result in a breach of, constitute (with due
notice or lapse of time or both) a default or cause any obligation, penalty or
premium to arise or accrue under any material contract, lease, loan agreement,
mortgage, security agreement, trust indenture or other agreement or instrument
to which any of the Magellan Parties is a party or by which any of them is
bound.
Section 3.4 Solvency
Each of the Magellan Parties is, and immediately after entering into this
Agreement will be, Solvent.
ARTICLE IV
RELEASE OF CERTAIN INDEMNIFICATION OBLIGATIONS
Section 4.1 Release
(a) Each of the Magellan Parties, on behalf of themselves and any
persons or entities that may be entitled to assert rights and remedies under any
of the Subject Agreements, hereby fully and completely covenants not to xxx,
waives and releases and forever discharges the Xxxxxxxx Parties and their
respective members, officers, directors, employees, agents, successors and
assigns, and their affiliates, subsidiaries and their respective members,
officers, directors, employees, agents, successors and assigns from any and all
past, present and future indemnification obligations that are a result of or
arise out of the obligations contained in the following provisions of the
Subject Agreements:
(i) Article IV of the New Omnibus Agreement;
(ii) (A) clause (a) of Section 10.1 of the Contribution
Agreement, except for those indemnification obligations that are a result
of or arise out of Section 3.12(c) (Employees and Benefits) and, to the
extent it relates to employee benefit matters, Section 3.12(d) (Employees
and Benefits), and Section 3.27 (Excluded Assets), and (B) clause (b) of
Section 10.1 of the Contribution Agreement;
(iii) (A) clause (a) of Section 8.2 of the Purchase Agreement,
but only to the extent relating to, arising out of or resulting from any
breach or inaccuracy of any representation in Section 2.15 (Compliance
with Law), and Section 2.21 (Environmental, Health and Safety Matters),
and (B) any of the matters listed on Schedule 2.15 or Schedule 2.21 of the
Purchase Agreement, including all supplemental disclosures made thereto,
except as disclosed on Schedule 4.1.1 hereto; provided, however, for the
avoidance of doubt, that nothing in this Section 4.1(a)(iii)(B) releases
or is intended to release the Xxxxxxxx Parties from any breaches of or
inaccuracies in Section 2.12 of the Purchase Agreement.
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The foregoing release shall apply to any claims or notices for
indemnification previously made by any of the Magellan Parties to any of the
Xxxxxxxx Parties, by the delivery of notice or otherwise, pursuant to any of the
provisions of, or schedules to, the Subject Agreements that are subject to
release as provided for in clauses (i) through (iii) above; provided, however
that Xxxxxxxx shall make payment of $2.1 million as a full and complete
settlement of all liabilities in connection with all invoices submitted prior to
the Effective Date of this Agreement by the Magellan Parties within ten (10)
business days of execution of this Agreement.
To the extent not covered by the foregoing provisions of this Section
4.1(a), each of the Magellan Parties, on behalf of themselves and any persons or
entities that may be entitled to assert rights and remedies under any of the
Subject Agreements, also hereby fully and completely covenants not to xxx,
waives and releases and forever discharges the Xxxxxxxx Parties and their
respective members, officers, directors, employees, agents, successors and
assigns, and their affiliates, subsidiaries and their respective members,
officers, directors, employees, agents, successors and assigns from any and all
past, present or future causes of action, rights of contribution or
indemnification obligations that are environmental in nature on the part of any
of the Xxxxxxxx Parties or any of their affiliates in favor of any of the
Magellan Parties arising under the Subject Agreements, any other written or oral
agreements among the parties or under applicable law with respect to the assets,
businesses or properties of the Magellan Parties or their affiliates or
predecessors that arise out of or that are a result of facts, occurrences,
conditions, events or circumstances (collectively, "Occurrences") that occur
before the Closing Date (as defined in the Purchase Agreement) without regard to
the date of discovery of such Occurrences, including without limitation (i) the
breach of or failure to comply with or liability arising under any Environmental
Laws (as defined in the Purchase Agreement), (ii) the presence of Hazardous
Materials (as defined in the Purchase Agreement) in, or their release into the
air, surface or subsurface soils or in the groundwater at, on, in, under or in
the vicinity of the assets, businesses or properties of the Magellan Parties or
(iii) the matters listed on Schedule 4.1.2 hereto, notwithstanding the fact in
any such case that the Occurrence giving rise to such cause of action,
obligation or right may also involve the breach of a provision of any of the
Subject Agreements that is not subject to the release contained in the foregoing
provisions of this Section 4.1(a) and which is not released under this Section
4.1(a).
For the avoidance of doubt, Schedule 4.1.3 hereto provides examples of the
types of Claims or other matters that would be subject to the provisions of the
immediately preceding paragraph and this Section 4.1 if such Claims or other
matters arise out of, are caused by or result of from, whether directly or
indirectly, an Occurrence that is environmental in nature. However, also for the
avoidance of doubt, the provisions of the immediately preceding paragraph and
this Section 4.1 do not reach and are not intended to release or discharge the
Xxxxxxxx Parties or their respective members, officers, directors, employees,
agents, successors and assigns, or their affiliates, subsidiaries or their
respective members, officers, directors, employees, agents, successors or
assigns from any past, present or future causes of action, rights of
contribution or indemnification obligation arising under the Subject Agreements,
any other written or oral agreements among the parties or under applicable law
in connection with the Excluded Assets (as defined in the Contribution
Agreement, the Purchase Agreement or the Contribution, Conveyance and Assumption
Agreement, dated February 9, 2001, entered into in connection with the initial
public offering of MMP).
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(b) The parties hereto acknowledge and agree that this Section 4.1
shall require MMP to indemnify and defend, save and hold the Xxxxxxxx Parties
and their affiliates harmless against any Claim (as defined below) by a
third-party arising out of, resulting from or any of the matters covered by the
provisions of Section 4.1(a) above as to which the Magellan Parties provided a
release pursuant to this Section 4.1.
(c) For the avoidance of doubt, the parties hereto acknowledge and
agree that this Section 4.1 shall include any damage, judgment, fine, penalty,
demand, settlement, liability, loss, cost, expense (including attorneys',
consultants' and experts' fees) claim or cause of action whether fixed,
contingent or unliquidated, including but not limited to the Comprehensive,
Environmental Response, Compensation and Liability Act, 42 U.S.C. 9601 et seq.,
as now or as hereafter amended ("CERCLA") or any similar or successor Federal
law or any state equivalent to CERCLA, as may now or hereafter be in effect.
Section 4.2 Discharge and Settlement of Obligations
(a) This Agreement settles and is in satisfaction of all past,
present and future indemnification obligations set forth in Section 4.1 on the
part of the Xxxxxxxx Parties or any affiliate thereof in favor of Magellan
Parties, any of their affiliates, successors or assigns with respect to any
damage, judgment, fine, penalty, demand, settlement, liability, loss, cost,
expense, claim, suit or cause of action (including reasonable attorneys',
consultants' or experts' fees related thereto) of any kind or nature whatsoever,
both known and unknown, except for the performance by Xxxxxxxx Parties of their
obligations as set forth in this Agreement.
(b) For purposes of clarity, this Agreement has no effect on (i)
MMH's obligations under Section 8.2(b) of the Purchase Agreement, (ii) MMH's
obligations to MMP under Section 1.3(e) and Section 8.2(c) of the Purchase
Agreement or (iii) MMP's obligations under Section 10.2 of the Contribution
Agreement.
Section 4.3 Indemnification Relating to Certain Matters
(a) MMP agrees to indemnify and defend, save and hold the Xxxxxxxx
Parties and their affiliates harmless if any such Xxxxxxxx Party or affiliate
thereof shall suffer any damage, judgment, fine, penalty, demand, settlement,
liability, loss, cost, expense, claim, suit or cause of action (including
reasonable attorneys' fees related thereto) (collectively, a "Claim") filed by,
arising out of, resulting from or relating to (i) the Claims set forth on
Schedule 4.3(a) hereto, and (ii) any current or former employees of the Xxxxxxxx
Parties or any of their predecessors, subsidiaries or affiliates as to whom 50%
or more of their work assignment was to perform work or services benefiting for
or on behalf of Magellan GP, MMP or any of their predecessors, subsidiaries or
affiliates ("Subject Parties") subsequent to February 9, 2001 or pursuant to the
Transition Services Agreement, dated June 17, 2003, between Xxxxxxxx and MMH;
provided, however, that such Claim arose out of or occurred during the
performance of work or services performed by such current or former employees
for the benefit or on behalf of such Subject Parties. To the extent allowable
under applicable law, the Xxxxxxxx Parties shall provide MMP copies of those
portions of the employment files for any employee for which the Xxxxxxxx Parties
seeks indemnification from under this Section 4.3 that are necessary for the
defense of such Claim and shall fully cooperate in responding to any reasonable
request for
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access to data, employees or other information necessary to the defense of the
matter; provided, however, MMP will comply with all applicable confidentiality
requirements with respect to any such files, data or information so provided. If
the Xxxxxxxx Parties do not provide MMP with such necessary portions of the
employee files relating to any such Claim, the indemnification obligations of
MMP under this Section 4.3 relating to such Claim shall be extinguished. The
foregoing indemnification obligations of MMP shall not be reduced as a result of
the availability of insurance coverage under policies held by the Xxxxxxxx
Parties; provided, however, the Xxxxxxxx Parties will use commercially
reasonable efforts (which, in all cases, for purposes of this Agreement shall
not require any party to file or initiate any judicial claim or action), to
pursue claims under any applicable insurance policies held by the Xxxxxxxx
Parties that may provide coverage in connection with the defense or resolution
of any matter covered under this Section 4.3. Any amounts recovered by the
Xxxxxxxx Parties pursuant to any such claim shall be paid to MMP, provided, that
such amounts paid shall in no event exceed that total amount expended by MMP in
connection with its indemnification obligations hereunder less any out-of-pocket
costs and expenses paid to third parties by the Xxxxxxxx Parties in connection
with pursuing such claim. This Section 4.3(a) does not apply to any employee
benefit matters and in no way waives, limits or resolves, in whole or in part,
the indemnification obligations of the Xxxxxxxx Parties for breaches of the
representation and warranty contained in (i) Section 3.12(c) of the Contribution
Agreement and, (ii) to the extent they relate to employee benefit matters,
Section 3.12 (d) of the Contribution Agreement or Section 4.3 of the Purchase
Agreement.
(b) With respect to the matters set forth on Schedule 4.3(b) hereto,
MMP shall bear the costs of defending the Xxxxxxxx Parties and the Magellan
Parties against the claims asserted in that case up to final resolution of the
matter. In the event that Xxxxxxxx determines that it needs separate counsel in
the matters set forth on Schedule 4.3(b) hereto, it shall be entitled to retain
one at its own costs and expense. The costs of satisfying any settlement or
judgment in those matters shall be determined by reference to the evidence
concerning the parties' respective liability for the claims asserted. MMP shall
be responsible for that portion of the matters on Schedule 4.3(b) hereto that
relate to work or services benefiting the Subject Parties and the Xxxxxxxx
Parties shall be responsible for that portion of such matters that relate to
work or services that do not benefit the Subject Parties. In the event that the
parties are not able to agree upon their respective liability for the claims
asserted, they shall initiate a mediation of the dispute using Judge Xxxxxx X.
Xxxxx, or if unavailable a substitute mediator mutually agreeable to the
parties, and shall be bound by such mediator's decision regarding their
respective shares of the liability for the claims asserted and the costs of any
settlement or judgment entered shall be allocated according to those shares.
ARTICLE V
PRIOR OBLIGATIONS, COSTS, EXPENSES AND INSURANCE
Section 5.1 Payment of Costs and Expenses
Each party to this Agreement shall be solely responsible for the payment
of any and all direct or indirect costs or services, provided by, but not
limited to, consultants, attorneys, contractors, agents and advisors relating to
or arising out of any matters covered under Section 4.1 above for costs and
services provided for said party prior to the Effective Date.
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Section 5.2 Notice to Service Providers
The Xxxxxxxx Parties have entered into certain contracts with third
parties for services or goods in connection with or arising out of the matters
covered under Section 4.1 and Section 4.3 above. The Xxxxxxxx Parties shall give
notice to all such third parties to such contracts to the effect that MMP will
be administering these matters after the Effective Date, and MMP and entities
controlled by MMP may contact and/or enter into contracts with any of such third
parties for the provisions of the same or similar services or goods after the
Effective Date. This Section 5.2 above does not apply to any legal counsel
retained by the Xxxxxxxx Parties.
Section 5.3 Procedures for Transfer of Matters and Litigation Currently
Managed by Xxxxxxxx to Magellan Parties
The Xxxxxxxx Parties shall cooperate with MMP and provide appropriate and
timely assistance in the transfer to MMP of all matters and litigation covered
under Section 4.1 and Section 4.3 above that are currently managed by Xxxxxxxx,
including all matters that are listed on Schedule 2.16 to the Purchase
Agreement. The Xxxxxxxx Parties shall direct any legal counsel retained by the
Xxxxxxxx Parties to provide copies of their files, correspondence, date and
records to the Magellan Parties so long as the Xxxxxxxx Parties are advised by
such or other legal counsel that the provision of any of such files,
correspondence, date and records would not jeopardize the ability of the
Xxxxxxxx Parties to maintain attorney-client privilege as to third parties with
respect to the matters to which such files relate. The Xxxxxxxx Parties will
consider in good faith any request by the Magellan Parties that both such
parties enter into or execute a joint defense agreement satisfactory to both
parties.
Section 5.4 Insurance and Other Receivables
(a) Beginning on the Effective Date, the Xxxxxxxx Parties shall make
a written request to the appropriate insurers that they consent to the
assignment and transfer to the entity designated by MMP, all of the Xxxxxxxx
Parties' rights and interests, including the rights and interests of any
beneficiaries, held under the MMP Policies. In addition, the Xxxxxxxx Parties
shall request in writing to such insurers that the MMP Policies be amended to
reflect MMP and its subsidiaries as primary named insureds. Any proceeds
received from insurance claims under the MMP Polices assigned or transferred
under this Section 5.4(a) that have not been completely settled between the
insurance carrier and the policy owner or beneficiary that were filed prior to
the Effective Date shall be for the benefit of MMP or its designee; provided,
however, the Xxxxxxxx Parties or any affiliate thereof shall be promptly
reimbursed by MMP for any out-of-pocket costs and expenses paid to third parties
in connection with the receipt of such proceeds. From and after the Effective
Date, the Xxxxxxxx Parties shall have no obligation to provide any insurance
coverage or benefits to the Magellan Parties, their affiliates or their business
or properties.
(b) The provisions of Section 1.1(b) above shall apply to any
amounts paid to the Magellan Parties ("Third-Party Receivables") in settlement
or to satisfy a judgment (excluding, for clarity purposes, any insurance
proceeds from the MMP Policies referred to in Section 5.4(a)) arising out of any
request, claim or action made, controlled or filed by the Magellan Parties or
Xxxxxxxx Parties or any affiliates thereof but only to the extent that such
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request, claim or action is covered by the indemnity provisions of the Subject
Agreements as to which the Magellan Parties are herein providing a release
pursuant to Section 4.1. The Magellan Parties shall promptly provide notice to
the Xxxxxxxx Parties of any Third-Party Receivables collected under this Section
5.4(b) and shall provide the Xxxxxxxx Parties a full accounting related to such
third party receivables from the Magellan Parties, within 60 days of a request
by the Xxxxxxxx Parties.
(c) Notwithstanding the foregoing provisions of this Section 5.4,
nothing in this Agreement shall have any effect on the Xxxxxxxx Parties
obligations under Section 4.23 (WEG Insurance Continuation) of the Purchase
Agreement.
ARTICLE VI
COOPERATION AND CONTROL
Section 6.1 Cooperation
Each party to this Agreement shall use its commercially reasonable efforts
to cooperate in good faith and assist with consummating the actions contemplated
by this Agreement. Each party to this Agreement shall comply with and fulfill
the requirements of the attached Schedule 6.1 hereto.
ARTICLE VII
(RESERVED)
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.1 Successors and Assigns
This Agreement shall inure to the benefit of, and be binding upon, the
parties hereto and their respective successors and permitted assigns. No party
shall sell, assign or otherwise transfer all or any of its obligations hereunder
without the prior written consent of the other parties, such consent not to be
unreasonably withheld or delayed.
Section 8.2 Notices
All notices and other communications given or made pursuant hereto shall
be in writing and shall be deemed to have been duly given or made if delivered
personally or sent by overnight courier or sent by facsimile (with evidence of
confirmation of receipt) to the parties at the following address:
(a) If to any of the Xxxxxxxx Parties:
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The Xxxxxxxx Companies, Inc.
Xxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxx, General Counsel and
Senior Vice President
(b) If to any of the Magellan Parties:
Magellan Midstream Partners, L.P.
Xxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Facsimile: (918) 573 -1005
Attention: Xxxxx Xxxxxxxx, General Counsel
Section 8.3 Entire Agreement
This Agreement including the schedules hereto represents the entire
agreement and understanding of the parties with reference to the transactions
set forth herein and no representations and warranties have been made in
connection herewith other than those expressly set forth herein. This Agreement
supersedes all prior negotiations, discussion, correspondence, communications,
understandings and agreements between the parties relating to the subject matter
hereof.
Section 8.4 Titles and Headings
The Article and Section headings contained in this Agreement are solely
for convenience of reference and shall not affect the meaning or interpretation
of this Agreement or of any term or provision hereof.
Section 8.5 Signatures and Counterparts
The Agreement may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall be consider one and
the same agreement.
Section 8.6 Severability
If any provision of the Agreement is declared illegal or unenforceable by
reason of a decree of a court of last resort, then the parties shall promptly
meet and negotiate substitute provisions for those rendered or declared illegal
or unenforceable, but all of the remaining provisions of this Agreement shall
remain in full force and effect.
Section 8.7 Governing Law
This Agreement shall be governed and construed in accordance with the
substantive laws of the State of Oklahoma.
Section 8.8 Waiver and Amendments
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This waiver by any party hereto of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent
breach, whether or not similar, unless such waiver specifically states that it
is to be construed as a continuing wavier. Agreement may be amended, modified or
supplement only by a written instrument executed by the parties hereto.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written, the "Effective Date:"
XXXXXXXX PARTIES
XXXXXXXX ENERGY SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
XXXXXXXX NATURAL GAS LIQUIDS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
XXXXXXXX XX LLC
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
THE XXXXXXXX COMPANIES
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
MAGELLAN PARTIES
MAGELLAN MIDSTREAM PARTNERS, L.P.
By Its General Partner, Magellan GP, LLC
By: /s/ Xxx X. Xxxxxxxxxx
-------------------------------------------
Name: Xxx X. Xxxxxxxxxx
Title: Chief Executive Officer
MAGELLAN GP, LLC
By: /s/ Xxx X. Xxxxxxxxxx
-------------------------------------------
Name: Xxx X. Xxxxxxxxxx
Title: Chief Executive Officer
MAGELLAN MIDSTREAM HOLDINGS, L.P.
By: Magellan Midstream Management, LLC, its
General Partner:
By: /s/ Xxx X. Xxxxxxxxxx
-------------------------------------------
Name: Xxx X. Xxxxxxxxxx
Title: Chief Executive Officer
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