STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of November 10,
2004, is by and between Energy Partners, Ltd., a Delaware corporation (the
"Company"), and Energy Income Fund, L.P., a limited partnership organized under
the laws of the State of Delaware (the "Seller").
RECITALS
WHEREAS, the Seller owns 3,487,856 shares of the Company's common stock,
par value $0.01 per share ("Common Stock");
WHEREAS, simultaneously herewith, the Company and Credit Suisse First
Boston LLC, Xxxxxxx Xxxxx & Associates, Inc., Xxxxxx Xxxx, a division of Xxxx
Xxxxx Xxxx Xxxxxx, Inc. and Xxxxxxxxx Capital Partners, LLC (the "Underwriters")
have entered into that certain underwriting agreement (the "Underwriting
Agreement"), whereby the Company will issue and sell to the Underwriters
3,467,144 shares of Common Stock in a firm commitment underwriting (the
"Offering") pursuant to the Company's registration statement on Form S-3 (No.
333-117419) (the "Registration Statement") and a prospectus supplement filed
pursuant to Rule 424 under the Securities Act of 1933, as amended (the "Act");
and
WHEREAS, the Seller desires to sell to the Company, and the Company desires
to purchase from the Seller with the net proceeds from the Offering, 3,467,144
shares of Common Stock (the "Shares") on the terms and subject to the conditions
contained herein.
NOW THEREFORE, in consideration of the mutual covenants, conditions and
agreements set forth herein, and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE 1
PURCHASE AND SALE; CLOSING
Section 1.1 Purchase and Sale. Subject to the terms and conditions of this
Agreement, at the Closing (as defined below), the Seller will sell, transfer and
deliver to the Company, and the Company will purchase and acquire from the
Seller, the Shares, free and clear of all mortgages, liens, pledges, charges,
encumbrances, security interests, claims, options and restrictions of any kind
("Liens").
Section 1.2 Purchase Price; Payment. The aggregate purchase price for the
Shares is $57,377,766 (the "Purchase Price"), which price represents the
aggregate purchase price to be received by the Company in the Offering after
deducting all underwriting discounts and commissions, but before expenses, and
shall be payable to the Seller by wire transfer of immediately available funds
to the account or accounts designated by the Seller.
Section 1.3 Closing. The closing of the purchase and sale of the Shares
(the "Closing") shall occur at the same time and location of the closing of the
Offering, which is currently expected to be on November 16, 2004, at the offices
of Xxxxxx Xxxxxx & Xxxxxxx LLP, 00
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The date of the Closing is hereinafter
referred to as the "Closing Date."
Section 1.4 Closing Deliveries. At the Closing, the following shall occur:
(a) the Seller shall deliver, or cause the custodian to deliver, to
the Company certificates representing the Shares duly endorsed in blank or
accompanied by duly executed assignment documents;
(b) the Company shall deliver the Purchase Price in accordance with
Section 1.2; and
(c) the parties shall deliver to each other such other documents and
take such other actions as may be necessary to consummate the transactions
contemplated hereunder.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF SELLER
The Seller hereby represents and warrants to, and agrees with the Company,
that:
Section 2.1 Existence and Power. Seller has been duly organized and is
validly existing and in good standing as a limited partnership, under the laws
of the State of Delaware, with the requisite power and authority to execute and
deliver this Agreement and consummate the transactions and perform its
obligations contemplated by this Agreement.
Section 2.2 Independent Investigation. Seller (a) has the requisite
knowledge, sophistication and experience in order to fairly evaluate a
disposition of the Shares under this Agreement, including the risks associated
therewith, and (b) has adequate information and has made its own independent
investigation and evaluation to the extent it deems necessary or appropriate
concerning the properties, business and financial condition of the Company to
make an informed decision regarding the sale of the Shares under this Agreement.
Section 2.3 Authority/No Conflicts. The execution, delivery and performance
of this Agreement, the consummation of the transactions contemplated in this
Agreement and compliance by the Seller with its obligations under this Agreement
have been duly authorized by all necessary limited partnership action and do not
and will not, whether with or without the giving of notice or passage of time or
both, conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Seller pursuant to any
contract, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which the Seller is a party or by
which it may be bound, or to which any of the property or assets of the Seller
is subject (except for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not result in a Material Adverse Effect (as defined
below) on Seller), nor will such action result in any violation of the
provisions of the organizational documents of the Seller or any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having juris-
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diction over the Seller or any of its assets, properties or operations, except
as would not have a Material Adverse Effect on Seller. For purposes of this
Agreement, "Material Adverse Effect" means (a) a material adverse effect on the
condition (financial or other), business, properties or results of operations of
Seller or the Company, as applicable, or (b) any result, fact, change,
violation, event or effect that would delay or prevent the consummation of the
transactions contemplated by this Agreement. As used herein, a "Repayment Event"
means any event or condition that gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or a portion
of such indebtedness.
Section 2.4 Execution. This Agreement has been duly authorized, executed
and delivered by the Seller and constitutes the legal, valid and binding
agreement of the Seller enforceable against it in accordance with its terms,
except as may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors' rights generally, and (ii) equitable principles of
general applicability relating to the availability of specific performance,
injunctive relief, or other equitable remedies.
Section 2.5 Ownership of Shares. The Seller has, and will have on the
Closing Date, valid and unencumbered title to the Shares, and has full right,
power and authority to sell, assign, transfer and deliver the Shares hereunder;
and upon the delivery of and payment for the Shares on the Closing Date
hereunder, the Company will acquire valid and unencumbered title to the Shares.
Section 2.6 No Approvals. No filing with, or consent, approval,
authorization, license, order, registration, qualification or decree of, any
court or governmental authority or agency, domestic or foreign, is necessary or
required for the performance by the Seller of its obligations hereunder, or in
connection with the offer, sale and delivery of the Shares hereunder or the
consummation by the Seller of the transactions contemplated by this Agreement,
except such as may have previously been made or obtained or as may be required
under the Act, Section 16 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the rules and regulations of the Securities and Exchange
Commission (the "SEC") or state securities laws.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to, and agrees with the Seller,
that:
Section 3.1 Existence and Power. The Company has been duly organized and is
validly existing and in good standing as a corporation, under the laws of the
State of Delaware, with the requisite power and authority to execute and deliver
this Agreement and consummate the transactions and perform its obligations
contemplated by this Agreement.
Section 3.2 Authority/No Conflicts. The execution, delivery and performance
of this Agreement, the consummation of the transactions contemplated in this
Agreement and compliance by the Company with its obligations under this
Agreement have been duly au-
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thorized by all necessary corporate action and do not and will not, whether with
or without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any subsidiary pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any subsidiary is subject (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that would not
result in a Material Adverse Effect on the Company), nor will such action result
in any violation of the provisions of the charter or by-laws, or other
organizational documents, of the Company or any subsidiary or any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any subsidiary or any of their assets,
properties or operations, except as would not have a Material Adverse Effect on
the Company.
Section 3.3 Execution. This Agreement has been duly authorized, executed
and delivered by the Company and constitutes the legal, valid and binding
agreement of the Company enforceable against it in accordance with its terms,
except as may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors' rights generally, and (ii) equitable principles of
general applicability relating to the availability of specific performance,
injunctive relief, or other equitable remedies.
ARTICLE 4
COVENANTS
Section 4.1 Public Announcements. No party shall issue any press release or
make any public announcement relating to the subject matter of this Agreement
prior to the Closing without the prior written approval of the other party;
provided, however, that the Company may make any public disclosure it believes
in good faith is required by applicable law or any listing or trading agreement
concerning its publicly-traded securities (in which case the Company will use
its reasonable efforts to advise the Seller prior to making the disclosure).
Section 4.2 Governmental Filings. Each party shall make all filings with
any governmental entity or authority required by such party in connection with
the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby, including without limitation all filings with
the SEC required pursuant to the Exchange Act.
Section 4.3 Waiver and Termination of Registration Rights. Upon
consummation of this Agreement and receipt of the Purchase Price by Seller, the
Seller hereby waives all rights it has under Section 3(b) of the registration
rights agreement, dated as of November 17, 1999, as amended, among the Company,
the Seller and certain shareholders of the Company (the "Registration Rights
Agreement") to receive prior written notice of the Company's intention to
register shares of Common Stock under the Registration Statement and the
Registration Rights Agreement shall be deemed terminated with respect to Seller.
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ARTICLE 5
CONDITIONS TO THE CLOSING
Section 5.1 Conditions of Obligation of the Company. The obligation of the
Company to purchase the Shares hereunder is subject to the satisfaction or
waiver of the following conditions:
(a) the Seller shall have performed in all material respects all of
its obligations hereunder required to be performed by it on or prior to the
Closing;
(b) the representations and warranties (without regard to materiality
qualifiers) of the Seller contained in this Agreement and in any
certificate or other writing delivered by the Seller pursuant hereto shall
be true in all material respects at and as of the Closing, as if made at
and as of such date;
(c) the Company shall have received a certificate signed by a duly
authorized representative of the Seller to the effect set forth in
subsections (a) and (b) above; and
(d) the Offering shall have been consummated on the terms and
conditions set forth in the Underwriting Agreement.
Section 5.2 Conditions of Obligations of the Seller. The obligations of the
Seller to consummate the transactions contemplated hereby is subject to the
satisfaction or waiver of the following conditions:
(a) the Company shall have performed in all material respects all of
its obligations hereunder required to be performed by it on or prior to the
Closing Date;
(b) the representations and warranties of the Company (without regard
to materiality qualifiers) contained in this Agreement and in any
certificate or other writing delivered by the Company pursuant hereto shall
be true in all material respects at and as of the Closing Date, as if made
at and as of such date; and
(c) the Seller shall have received a certificate signed by a duly
authorized officer of the Company to the effect set forth in subsections
(a) and (b) above.
ARTICLE 6
MISCELLANEOUS
Section 6.1 Delivery of Shares. Pursuant to and according to the terms in
that certain custody agreement between the Company and the Seller dated November
8, 2004 (the "Custody Agreement"), the Company is authorized and directed to
hold the certificates deposited with it in its custody for the account of the
Seller.
Section 6.2 Amendments; No Waivers. Any provision of this Agreement may be
amended or waived if, and only if, such amendment or waiver is in writing and
signed, in
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the case of an amendment, by each party, or in the case of a waiver, by the
party against whom the waiver is to be effective. No failure or delay by either
party in exercising any right, power or privilege 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, power or
privilege.
Section 6.3 Expenses. Subject to the terms of the Registration Rights
Agreement, each party hereto shall pay its own expenses incidental to the
preparation of this Agreement, the carrying out of the provisions of this
Agreement and the consummation of the transactions contemplated hereby.
Section 6.4 Entire Agreement. Subject to the terms of the Registration
Rights Agreement and Custody Agreement, this Agreement sets forth the entire
understanding of the parties with respect to the transactions contemplated
hereby. Any and all previous agreements and understandings between the parties
regarding the subject matter hereof, whether written or oral, are superseded by
this Agreement.
Section 6.5 Assignment and Binding Effect. This Agreement may not be
assigned by any party hereto without the prior written consent of the other
party. Subject to the foregoing, all of the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the successors and permitted assigns of the Seller and the Company.
Section 6.6 Notices. Any notice, request, demand, waiver, consent, approval
or other communication which is required or permitted hereunder shall be in
writing and shall be deemed given only upon delivery by: (a) personal delivery
to the designated individual; (b) certified or registered mail, postage prepaid,
return receipt requested; (c) a nationally recognized overnight courier service
with confirmation of receipt; or (d) facsimile transmission with confirmation of
receipt. All such notices must be addressed as follows or such other address as
to which any party hereto may have notified the other in writing:
If to the Seller: Energy Income Fund
000 Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxxx 00000 Attn:
Xxxxxx Xxxxxxx
Fax: (000) 000-0000
If to the Company: Energy Partners, Ltd.
000 Xx. Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attn: Xxxx X. Xxxxx
Fax: (000) 000-0000
Section 6.7 Governing Law. This Agreement shall be governed by and
interpreted and enforced in accordance with the internal laws of the State of
New York, without reference to the conflict of laws principles thereof.
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Section 6.8 Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by reason of any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any adverse
manner to any party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that the transactions contemplated hereby are fulfilled to the extent possible,
and in any case such term or provision shall be deemed amended to the extent
necessary to make it no longer invalid, illegal or unenforceable.
Section 6.9 Termination. Notwithstanding any provision in this Agreement to
the contrary, this Agreement (other than the terms of Section 6.3, which shall
remain in full force and effect) shall terminate if the Underwriting Agreement
is terminated prior to Closing for any reason.
Section 6.10 Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any action instituted in any court
of the United States or any state thereof having jurisdiction over the parties
and the matter, this being in addition to any other remedy to which they are
entitled at law or in equity.
Section 6.11 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed to be an
original and all of which taken together shall constitute one and the same
instrument.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on
the date first written above.
ENERGY PARTNERS, LTD.
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Chairman, President and
Chief Executive Officer
ENERGY INCOME FUND, L.P.
By: Its General Partner
EIF General Partner, L.L.C.
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Managing Director
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