1
EXHIBIT 99.7
X.X. Xxxx & Co., Inc.
00 Xxxxx Xxxxxx, Xxx Xxxx, X.X. 00000
(000) 000-0000
June 14, 2001
Xx. Xxxx Xxxxxxx
Executive Vice President , General Counsel
Pioneer Natural Resources Company
0000 X. X'Xxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxx XX 00000
Re: Merger of 46 Xxxxxx & Parsley Limited Partnerships with Pioneer Natural
Resources Company (the "Company")
Dear Xxxx:
This letter agreement sets forth the terms and conditions under which
X.X. Xxxx & Co., Inc. ("King") has been engaged in connection with the special
meeting of limited partners scheduled to be determined (the "Meeting").
1. The Company hereby retains King for proxy solicitation services and
tabulation of proxies (the "Services") in connection with the Meeting and
requests and authorizes King to contact and to provide information to the
Partnership's unitholders with respect to matters to be considered at the
Meeting. For the purposes of this agreement, such Services shall not include
services in connection with a special meeting for which there is a solicitation
in opposition to a resolution.
2. The Company agrees that King shall have the right to pass upon and
approve any and all references to King in any materials used by the Company in
connection with the Meeting (the "Materials").
3. King agrees to preserve the confidentiality of all non-public
information provided by the Company or its agents for King's use in rendering
services hereunder.
4. The Company agrees to pay to King as compensation for the Services a
fee of $12,500, plus an additional fee of $4.00 per outgoing and incoming
unitholder telephone contact, plus line charges. In addition, there is a fee
$.25 per proxy received and tabulated. The fee of $12,500 is payable, pursuant
to the following schedule:
$ 6,250 Due and payable on the date that the Company's Materials
are first sent or mailed to its stockholders; and
$ 6,250 Due and payable on the date of the Meeting.
----------
$12,500.00
==========
2
-2-
The Company will promptly reimburse King for all reasonable mailing
expenses, costs and disbursements including reasonable counsel fees and expenses
(the "Expenses") incurred by King in connection with the Services. King will
meet these Expenses from a Reimbursement Account (the "Account") established by
the Company pursuant to King's written invoice of estimated expenses. The funds
required to establish the Account shall be due and payable not later than the
date that the Company's Materials are first sent or mailed to its unitholders.
The Account, if depleted, will be replenished by the Company upon
King's written request, accompanied by King's interim summary of expenses. As
promptly as practicable upon conclusion of this engagement, King will submit its
final invoice for Services and return to the Company any unused portion of the
Account.
The Company agrees and acknowledges that the Company's obligations
under this paragraph 4 are fixed and nonrefundable (with the exception of the
unused portion, if any, of the Account as set forth above), regardless of future
developments in, or the outcome of, the Meeting. If a solicitation in opposition
to the Board or in opposition to a resolution proposed by the Board arises
during the course of this engagement, and King undertakes to perform additional
services therewith, the fee will be modified as mutually agreed.
5. The Company represents and warrants to King that:
(a) all necessary corporate or other action will have been duly taken by
the Company prior to the commencement of any solicitation to
authorize the solicitation; and
(b) all material will comply, in all material respects, with the
Securities Exchange Act of 1934, as amended and the rules and
regulations of the Securities and Exchange Commission thereunder,
and all other applicable laws; and, none of the Materials will
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements made therein not misleading.
6. King hereby represents and warrants to the Company and Pioneer USA, Inc
that neither King nor any of its officers or employees who, in
connection with the services, may come in contact with the limited
partners of the Partnerships is, or has been within the past five (5)
years, subject to the following in connection with a violation of a
state or federal securities law or regulation:
(i) an order denying, suspending or revoking registration of such
person as an agent, a cease and desist order, or any similar
order, judgement, or decree by any state securities agency,
the Securities and Exchange Commission, or any self-regulatory
securities organization; or
(ii) an order of any court of competent jurisdiction temporarily,
preliminarily or permanently enjoining such person.
3
-3-
7. The Company hereby agrees to hold harmless and indemnify King and its
officers, directors, employees and agents (collectively the "Indemnified
Persons") from and against all losses, claims, damages, liabilities,
disbursements and expenses (including, but not limited to, reasonable counsel
fees and expenses) incurred by such Indemnified Persons in connection with any
claim arising out of, relating to or in connection with the Services, the
Meeting and/or the matters relating thereto including the representations and
warranties set forth in paragraph 5 above, except for King's gross negligence or
willful misconduct. The Company shall reimburse such Indemnified Persons for
such counsel fees and expenses when they are paid or incurred by such
Indemnified Persons. The foregoing indemnity shall be in addition to any
liability which the Company might otherwise have to the Indemnified Persons.
8. King agrees to notify the Company promptly of the assertion of any
claim against any of the Indemnified Persons in connection with matters set
forth in paragraph 7; and the Company agrees to notify King promptly of the
assertion of any claim against the Company. At the Company's election, unless
there is a conflict of interest, the defense of Indemnified Persons shall be
conducted by the Company's counsel who shall be satisfactory to King. In any
action or proceeding the defense of which the Company assumes, an Indemnified
Person will have the right to participate in such litigation and to retain its
own counsel at such Indemnified Person's own expense. The Company shall not
settle or compromise any such action or proceeding without the Indemnified
Persons' prior written consent, unless the terms of such settlement or
compromise include an unconditional Release of the Indemnified Persons from all
liability or loss arising out of such proceeding.
9. The representations and warranties contained in paragraphs 5 and 6
above and the indemnity agreement contained in paragraph 7 and 8 above will
survive the term of this agreement.
4
-4-
10. This letter agreement shall be construed and enforced in accordance
with the laws of the State of New York, without reference to its conflict of law
provisions. The Company agrees that any action, suit or proceeding arising out
of or based upon this letter agreement shall be brought in any court of
competent jurisdiction located in the County of New York or, at King's option,
wherever any claim which is subject to this Agreement is asserted against King
or any Indemnified Persons, and the Company hereby consents to personal
jurisdiction and venue of such court and to service of process by certified
mail, return receipt requested.
This agreement shall be binding on the successors and assigns of King
and the Company, and may not be modified except in writing signed by the parties
hereto.
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof by signing below, whereupon this letter shall
constitute a binding agreement between the Company and King.
X.X. XXXX & CO., INC.
By: /s/ Xxxxxx X. Xxxx
------------------------------
Xxxxxx X. Xxxx
Executive Vice President
ACCEPTED AS OF THE DATE
FIRST ABOVE WRITTEN:
PIONEER NATURAL RESOURCES COMPANY
By: /s/ Xxxx X. Xxxxxxx
------------------------------------
(Name) Xxxx X. Xxxxxxx
Executive Vice President
------------------------
(Title)
