Exhibit 2.16
INTERNAL RESTRUCTURING AGREEMENT
DATED AS OF
_______________ __, 2005
RELATING TO
ANR HOLDINGS, LLC
TABLE OF CONTENTS
1. DEFINITIONS.................................................................... 2
Section 1.01 Definitions....................................................... 2
Section 1.02 Additional Defined Terms......................................... 7
Section 1.03. Other Definitional and Interpretative Provisions................. 8
2. RESTRUCTURING TRANSACTIONS..................................................... 9
Section 2.01. Company Organizational Matters................................... 9
Section 2.02. Dissolution and Liquidation of Alpha Management.................. 9
Section 2.03. Distributions to the AMCI Parties and Fund IX.................... 9
Section 2.04. Contribution of Fund IX Corp..................................... 10
Section 2.05. Contribution of Membership Interests............................. 10
Section 2.06. Approval of Restated Charter and LTIP............................ 11
Section 2.07. Conversion of Options and Assumption of Amended and Restated
Alpha Management LTIP.......................................................... 11
Section 2.08. Assumption of Alpha Natural Resources Annual Incentive Bonus
(AIB) Plan..................................................................... 11
Section 2.09. Agreement Regarding Allocation of Shares and Company Notes....... 12
Section 2.10. Distributions to Pay Pre-Closing Taxes........................... 12
3. PUBLIC OFFERING................................................................ 12
4. RESTRUCTURING CLOSING.......................................................... 13
Section 4.01. Restructuring Closing............................................ 13
Section 4.02 Actions at the Restructuring Closing.............................. 13
5. REPRESENTATIONS AND WARRANTIES OF THE PARTIES.................................. 13
Section 5.01 Organization of Parties........................................... 13
Section 5.02 Authorization of Transaction...................................... 13
Section 5.03. Noncontravention................................................. 14
Section 5.04. Brokers' Fees.................................................... 14
Section 5.05. Investment....................................................... 14
Section 5.06. Ownership of Equity Interests.................................... 15
Section 5.07. Registration Statement........................................... 15
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................................. 15
Section 6.01. Capitalization................................................... 15
7. REPRESENTATIONS AND WARRANTIES OF HOLDINGS..................................... 16
Section 7.01. Capitalization................................................... 16
8. REPRESENTATIONS AND WARRANTIES OF ALPHA MANAGEMENT............................. 16
Section 8.01. Capitalization................................................... 16
9. REPRESENTATIONS AND WARRANTIES OF FUND IX REGARDING FUND IX CORP............... 17
Section 9.01 Incorporation and Other Organizational Matters.................... 17
Section 9.02 Noncontravention.................................................. 17
Section 9.03. Capitalization................................................... 17
Section 9.04. Business of Fund IX Corp......................................... 18
Section 9.05. Assets and Liabilities of Fund IX Corp........................... 18
Section 9.06. Restrictions on Business Activities.............................. 18
10. COVENANTS OF THE PARTIES...................................................... 18
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Section 10.01. Consent and Agreement........................................... 18
Section 10.02. Release......................................................... 18
Section 10.03. Best Efforts; Further Assurances................................ 19
Section 10.04. Indemnification by the Company.................................. 19
11. CONDITIONS.................................................................... 24
Section 11.01. Conditions to Obligations of Each Party......................... 24
Section 11.02. Conditions to the Obligations of the Alpha Entities............. 24
Section 11.03. Conditions to the Obligations of Each Member.................... 25
12. TERMINATION................................................................... 25
Section 12.01. Termination..................................................... 25
Section 12.02. Effect of Termination........................................... 25
13. MISCELLANEOUS................................................................. 26
Section 13.01. Survival........................................................ 26
Section 13.02. Notices......................................................... 26
Section 13.03. Amendments and Waivers.......................................... 28
Section 13.04. Expenses........................................................ 29
Section 13.05. Successors and Assigns.......................................... 29
Section 13.06. Governing Law................................................... 29
Section 13.07. Arbitration..................................................... 29
Section 13.08. Counterparts; Effectiveness; Third Party Beneficiaries.......... 29
Section 13.09. Entire Agreement................................................ 29
Section 13.10. Severability.................................................... 30
Section 13.11. Specific Performance............................................ 30
Section 13.12. AMCI Representative............................................. 30
Section 13.13. Management Members Representative............................... 31
Section 13.14. FRC Representative.............................................. 31
Section 13.15. Limited Right of Rescission..................................... 32
Section 13.16. Amendment to LLC Agreement..................................... 33
EXHIBITS
EXHIBIT A Form of Restated Certificate of Incorporation of the Company
EXHIBIT B Form of Amended and Restated Bylaws of the Company
EXHIBIT C Form of Stockholder Agreement
EXHIBIT D Form of Long Term Incentive Plan of the Company
EXHIBIT E Form of Company Note
EXHIBIT F-1 Form of First Amendment to PEV Option Agreement
EXHIBIT F-2 Form of Sixth Amendment to the Contribution Agreement
EXHIBIT F-3 Form of Amendment to Solomons Letter Agreement
EXHIBIT G Form of Third Amended and Restated Limited Liability Company
Agreement of Holdings
EXHIBIT H Form of Amended and Restated Alpha Management LTIP
EXHIBIT I Alpha Natural Resources Annual Incentive Bonus (AIB) Plan
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SCHEDULES
Schedule I Management Members
Schedule II Holdings Membership Interests
Schedule 2.02 Distribution of Alpha Coal Management's Assets
Schedule 2.05A Exchange of AMCI Parties' Membership Interests
Schedule 2.05D Exchange of Membership Interests and Profits Interest held
by the Management Members
Schedule 2.07 Conversion of Options
Schedule 3C Option Grants
Schedule 5.02 Notices, Authorizations, Consents, and Approvals
Schedule 5.03 Noncontravention
Schedule 5.06 Equity Interests Contributed
Schedule 9.01 Officers and Directors of Fund IX Corp.
Schedule 9.05 Assets and Liabilities of Fund IX Corp.
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INTERNAL RESTRUCTURING AGREEMENT
INTERNAL RESTRUCTURING AGREEMENT (this "Agreement") dated as of
___________ __, 2005 among (i) Alpha Natural Resources, Inc., a Delaware
corporation (the "Company"), Alpha NR Ventures, Inc., a Delaware corporation,
and ANR Holdings, LLC, a Delaware limited liability company ("Holdings" and
together with the Company, the "Alpha Entities"), (ii) First Reserve Fund IX,
L.P. ("Fund IX"), ANR Fund IX Holdings, L.P., a Delaware limited partnership
("Fund IX Holdings and, together with Fund IX , the "FRC Parties"), (iii) Vollow
Resources LLC, a West Virginia limited liability company, Redbank, Inc., a West
Virginia corporation, REI, Inc., a West Virginia corporation, Still Run Coal
Company, Inc., a West Virginia corporation, Creekside Energy Development
Company, a West Virginia corporation, Newhall Pocahontas Energy, Inc., a West
Virginia corporation, SCM, Inc., a West Virginia corporation, Tanoma Energy,
Inc., a Pennsylvania corporation, Madison Mining Company, LLC, a Pennsylvania
limited liability company, Laurel Energy, L.P., a Pennsylvania limited
partnership, Laurel Resources, L.P., a Pennsylvania limited partnership, I-22
Processing, Inc., a Pennsylvania corporation, Dunamis Resources, Inc., a
Pennsylvania corporation, Beta Resources, LLC, a Colorado limited liability
company, and RRD, Inc., a West Virginia corporation, (collectively, the "AMCI
Parties"), (iv) Madison Capital Funding LLC, a Delaware limited liability
company ("Madison"), (v) Alpha Coal Management, LLC, a Delaware limited
liability company ("Alpha Management"), and (vi) those individual members of the
Alpha Natural Resources, LLC management team listed on Schedule I to this
Agreement (the "Management Members"). Together, the FRC Parties, the AMCI
Parties, Madison, Alpha Management and the Management Members shall be referred
to collectively in this Agreement as the "Members." Each of the Alpha Entities,
each of the FRC Parties, each of the AMCI Parties, Madison, Alpha Management,
and each of the Management Members is individually referred to in this Agreement
as a "Party," and, together, the Alpha Entities, the FRC Parties, the AMCI
Parties, Madison, Alpha Management, and the Management Members are referred to
in this Agreement as the "Parties."
RECITALS
WHEREAS, Holdings was formed as a limited liability company under the laws
of the state of Delaware pursuant to a Limited Liability Company Agreement
amended and restated as of May 11, 2004 (the "LLC Agreement");
WHEREAS, the Company was formed as a corporation under the laws of the
state of Delaware pursuant to a certificate of incorporation filed with the
Secretary of State of Delaware on November 29, 2004;
WHEREAS, the FRC Parties, the AMCI Parties, Madison, and Alpha Management
constitute all of the members of Holdings(except that Fund IX owns its interest
in Holdings indirectly through Alpha NR Holding, Inc., a Delaware corporation
("Fund IX Corp."), and they desire to transition their interest in Holdings to
the Company in anticipation of the issuance to the public of shares of common
stock of the Company;
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WHEREAS, the Members hold Membership Interests, which include the Common
Sharing Ratios and Preferred Sharing Ratios listed on Schedule II to this
Agreement, and the interests of Fund IX set forth on Schedule II reflect Fund
IX's indirect interest in Holdings);
WHEREAS, the Members intend the transition of their interests in Holdings
to the Company to be an "Internal Reorganization" as contemplated by the Member
Agreement, upon the terms and subject to the conditions of this Agreement;
WHEREAS, the Members intend that (i) the contribution of their Membership
Interests and the interest in Fund IX Corp. to the Company, the Public Offering
and the Over-allotment Distribution be characterized as an integrated
transaction governed by Internal Revenue Code Section 351 (and the related
provisions) and (ii) the record keeping and reporting requirements of Treasury
Regulation Section 1.351-3 will be satisfied;
WHEREAS, in connection with the Restructuring Transactions, the Company
will amend and restate its Certificate of Incorporation and Bylaws,
substantially in the forms attached to this Agreement as Exhibit A and Exhibit
B, respectively;
WHEREAS, this Agreement and the Restructuring Transactions have been
approved by the Board of Directors of the Company and Holdings, and by the board
of directors or the body serving similar functions of each of the Members;
NOW, THEREFORE, in consideration of the foregoing recitals, the mutual
promises set forth in this Agreement, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties agree
as follows:
1. DEFINITIONS
Section 1.01 Definitions. The following terms, as used herein, have the
following meanings:
"Adverse Consequences" means, without duplication, all actions, suits,
proceedings, hearings, investigations, charges, complaints, claims, demands,
injunctions, judgments, orders, decrees, rulings, damages, dues, penalties,
fines, costs, amounts paid in settlement, Liabilities, obligations, Taxes,
liens, losses, expenses, and fees, including court costs and reasonable
attorneys' fees and expenses, but excluding lost profits, punitive, exemplary,
special or consequential damages (except to the extent any such remedies are
included in the Third Party Claim by a non-Affiliate of the Party to be
indemnified under this Agreement, for which such Party is otherwise entitled to
indemnification under this Agreement).
"Affiliate" means any Person that directly or indirectly through one or
more intermediaries controls or is controlled by or is under common control with
the specified
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Person. As used in this definition of "Affiliate," the term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract, or otherwise.
"Alpha Management LTIP" means the 2004 Alpha Coal Management, LLC Long
Term Incentive Plan adopted by the Board of Directors and members of Alpha
Management as of November 10, 2004, pursuant to which the Board issued options
to purchase units in Alpha Management representing 1% of the Common Sharing
Ratios in Holdings.
"AMCI Representative" means Xxxx X. Xxxxx.
"Basis" means any past or present fact, situation, circumstance, status,
condition, activity, practice, plan, occurrence, event, incident, action,
failure to act, or transaction that forms or would be reasonably likely to form
the basis for any specified consequence.
"Business Day" means any day other than a Saturday, a Sunday or a United
States federal or New York State banking holiday.
"Commitment" means (a) options, warrants, convertible securities,
exchangeable securities, subscription rights, conversion rights, exchange rights
or other contracts that could require a Person to issue any of its Equity
Interests or to sell any Equity Interests it owns in another Person; (b) any
other securities convertible into, exchangeable or exercisable for, or
representing the right to subscribe for any Equity Interest of a Person or owned
by a Person; (c) statutory pre-emptive rights or pre-emptive rights granted
under a Person's Organizational Documents; and (d) stock appreciation rights,
phantom stock, profit participation, guarantee of profit, guarantee against
loss, or other similar rights with respect to a Person.
"Common Sharing Ratios" has the meaning ascribed thereto in the LLC
Agreement.
"Common Stock" means the common stock, par value $.01 per share, of the
Company.
"Company Note" means the Company's promissory note in the form of Exhibit
E.
"Continuing Agreements" mean the agreements in the form of Exhibits F-1
through F-3.
"Equity Interest" means (a) with respect to a corporation, any and all
shares of capital stock and any Commitments with respect thereto, (b) with
respect to a limited liability company, trust or similar Person, any and all
units, interests or other limited liability company interest, and any
Commitments with respect thereto, and (c) any other
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direct equity ownership, participation in a Person and any Commitments with
respect thereto.
"FRC Representative" means Fund IX.
"Fully Diluted Shares" means the number of outstanding shares of Common
Stock as of the date of determination, assuming that all shares of Common Stock
then reserved for issuance under the Alpha Management LTIP and the LTIP are
issued and outstanding.
"Governmental Authority" means any agency, authority, board, bureau,
commission, court, tribunal, department, office or instrumentality of any nature
whatsoever or any governmental unit, whether federal, state, county, district,
city, other political subdivision, or taxing district, foreign or otherwise, and
whether now or hereafter in existence, or any officer or official thereof acting
in an official capacity.
"HSR Act" means the Xxxx Xxxxx Xxxxxx Antitrust Improvements Act of 1976,
as amended.
"Law" means any statute, code or regulation of any applicable Governmental
Authority.
"Liability" means any liability (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due), including any liability for Taxes.
"Lien" means, with respect to any property or asset, any mortgage, lien,
pledge, charge, security interest, encumbrance or other adverse claim of any
kind in respect of such property or asset. For the purposes of this Agreement, a
Person shall be deemed to own subject to a Lien any property or asset which it
has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to such property or asset.
"LTIP" means the Long Term Incentive Plan of the Company in the form to be
adopted by the Board of Directors of the Company as attached as Exhibit D,
pursuant to which the Board will reserve for issuance thereunder a number of
shares of Common Stock equal to an aggregate of ___% of the Fully Diluted Shares
to be outstanding upon completion of the Public Offering.
"Management LLC Agreement" means the Liability Company Agreement of Alpha
Coal Management LLC, amended and restated as of March 10, 2004.
"Management Representative" means Xxxxxxx X. Xxxxxxx.
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"Material Contract" means, with respect to any Person, all contracts and
commitments, written or oral, including all amendments, modifications, waivers
and elections applicable thereto, to which such Person is a party or to which
such Person's assets are subject, (i) providing for receipt or payment,
contingent or otherwise, by such Person of $100,000 or more and which are not
terminable on 30 days' notice, (ii) relating to indebtedness or guarantee
obligations of such Person or (iii) otherwise necessary to the operation of the
business of such Person or its Subsidiaries.
"Member Agreement" means the Member Agreement dated as of March 11, 2003
among the FRC Parties, the AMCI Parties and the other signatories thereto, as it
may be amended from time to time.
"Membership Interest" means, in the case of a Member or Fund IX Corp.,
such Member's or Fund IX Corp.'s limited liability company interest in Holdings;
provided, that where the context refers to issued or outstanding Membership
Interests, such term refers to the Members' Common Sharing Ratios and Preferred
Sharing Ratios listed on Schedule II to this Agreement
"Organizational Documents" means the articles or certificate of
incorporation, charter, bylaws, articles or certificate of formation,
regulations, operating agreement, certificate of limited partnership,
partnership agreement, and all other similar documents, instruments or
certificates executed, adopted, or filed in connection with the creation,
formation, or organization of a Person, including any amendments thereto.
"Over-allotment Distribution" means the pro rata distribution by the
Company to the holders of the Pre-IPO Shares (if but only if the Over-allotment
Option is exercised) of (i) the net cash proceeds received by the Company from
the Underwriters upon the exercise of the Over-allotment Option and (ii) if the
Over-allotment Option is not exercised in full, a number of shares of Common
Stock equal to (x) the number of additional shares the Underwriters have the
option to purchase pursuant to the Over-allotment Option minus (y) the actual
number of shares the Underwriters purchase from the Company pursuant to the
Over-allotment Option.
"Over-allotment Option" means the option granted by the Company to the
Underwriters as an integral part of the Public Offering to purchase a number of
shares of Common Stock equal to up to 15% of the shares issued in the Public
Offering.
"Person" means any individual, general partnership, limited partnership,
limited liability company, corporation, joint venture, trust, business trust,
Governmental Authority, cooperative, association or any foreign trust or foreign
business organization or any other entity of any kind whatsoever, as well as the
heirs, executors, administrators, legal representatives, successors and assigns
of such Person where the context so requires.
"Pre-IPO Shares" means the shares of the Common Stock that will be
outstanding immediately before the completion of the Public Offering determined
by the Company in
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consultation with the Underwriters, and specifically excluding any shares of
Common Stock (i) issuable upon the exercise of any options to purchase shares of
Common Stock whether or not then exercisable and (ii) to be issued to the
Underwriters in connection with the Public Offering.
"Preferred Sharing Ratios" has the meaning ascribed thereto in the LLC
Agreement.
"Profits Interest" has the meaning given it in the Management LLC
Agreement.
"Public Offering" means the initial public offering of Common Stock
pursuant to as described in the Registration Statement that will be consummated
following the Restructuring Closing.
"Public Offering Closing Date" means the date of closing under the
Underwriting Agreement.
"Registration Statement" means the registration statement of the Company
on Form S-1 in respect of the Public Offering filed initially with the SEC on
December 6, 2004, together with all subsequent amendments thereto.
"Representatives" means, collectively, the AMCI Representative, the FRC
Representative and the Management Representative.
"Restructuring Closing Date" means the date that is the last business day
that precedes the date the Registration Statement is declared effective by the
SEC.
"Restructuring Transactions" means the steps taken or to be taken pursuant
to this Agreement to internally restructure the Alpha Entities in anticipation
of the Public Offering.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Stockholder Agreement" means the Stockholder Agreement to be entered into
among the Members and the Company in connection with the Restructuring
Transactions, substantially in the form attached as Exhibit C to this Agreement.
"Subsidiary" means, with respect to any Person (herein referred to as the
"parent"), any corporation, partnership, limited liability company, association
or other entity (a) of which securities or other ownership interests
representing more than 50% of the equity or having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are, at the time, directly or indirectly owned, controlled or held by
the parent and/or one or more subsidiaries of the parent.
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"Tax" or "Taxes" means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Section 59A of
the Internal Revenue Code of 1986, as amended), capital stock, franchise,
profits, withholding, social security (or similar), unemployment, disability,
real property, personal property, sales, use, transfer, registration, value
added, alternative or add-on minimum, estimated, or other tax of any kind
whatsoever, whether computed on a separate or consolidated, unitary or combined
basis or in any other manner, including any interest, penalty, or addition
thereto, whether disputed or not and including any obligation to indemnify or
otherwise assume or succeed to the Liability for Taxes of any other Person.
"Tax Benefit" means the tax effect of any item of loss, deduction,
reduction in income or credit or any other item (including increase in tax basis
of assets) which decreases Taxes paid or payable, including any interest in
respect thereto or interest that would have been payable but for such item.
"Terminated Agreements" means (i) the Member Agreement, (ii) the
Management LLC Agreement, (iii) that certain Pledge Agreement dated as of March
11, 2003 made by each of Vollow Resources LLC, Redbank, Inc., REI, Inc., Still
Run Coal Company, Inc., Creekside Energy Development Company, Newhall Pocahontas
Energy, Inc., SCM, Inc., RRD, Inc., Beta Resources, LLC, as Pledgors, to ANR
Fund IX Holdings, L.P., a Delaware limited partnership, and Alpha Natural
Resources, Inc., a Delaware corporation (now known as Alpha NR Holding, Inc., a
Delaware corporation), as Pledgees, and (iv) that certain Escrow Agreement dated
as of March 11, 2003 among ANR Fund IX Holdings, L.P., a Delaware limited
partnership, Alpha Natural Resources, Inc., a Delaware corporation (now known as
Alpha NR Holding, Inc., a Delaware corporation), K-M Investment Corp., a
Delaware corporation ("K-M"), and National City Bank of Pennsylvania, a national
banking association.
"Underwriters" means those several underwriters named in an underwriting
agreement (the "Underwriting Agreement") covering the purchase and sale of
shares of the Company's Common Stock in the Public Offering.
Section 1.02 Additional Defined Terms. Each of the following terms is
defined in the Section of this Agreement set forth opposite such term:
TERM SECTION
Agreement Preamble
Alpha Entities Preamble
Alpha Management Preamble
Alpha Management Securities 8.01
AMCI Parties Preamble
Ancillary Agreements and Instruments 5.02
Claim Notice 10.06
Company Agreement Recitals
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Company Securities 6.01
End Date 12.01
FRC Parties Preamble
Fund IX Preamble
Fund IX Corp. Preamble
Fund IX Corp. Securities 9.03
Fund IX Corp. Preferred Stock 9.03
Holdings Securities 7.01
Incremental Tax 2.02
Indemnitee 10.05
LLC Agreement Preamble
Madison Preamble
Management Members Preamble
Members Preamble
Party or Parties Preamble
Preferred Stock 6.01
Restructuring Closing 4.01
Third Party Claim 10.06
Threshold Amount 10.06
Section 1.03. Other Definitional and Interpretative Provisions. Unless
specified otherwise in this Agreement, the obligations of any Party consisting
of more than one Person are joint and several. Unless specified otherwise in
this Agreement, all words used in the singular number shall extend to and
include the plural, all words in the plural number shall extend to and include
the singular, and all words in any gender shall extend to and include all
genders. The words "hereof", "herein" and "hereunder" and words of like import
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof. References to Articles, Sections, Exhibits and Schedules
are to Articles, Sections, Exhibits and Schedules of this Agreement unless
otherwise specified. All Exhibits and Schedules annexed hereto or referred to
herein are hereby incorporated in and made a part of this Agreement as if set
forth in full herein. Any capitalized terms used in any Exhibit or Schedule but
not otherwise defined therein shall have the meaning as defined in this
Agreement. Whenever the words "include", "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation", whether or not they are in fact followed by those words or words of
like import. "Writing", "written" and comparable terms refer to printing, typing
and other means of reproducing words (including electronic media) in a visible
form. References to any agreement or contract are to that agreement or contract
as amended, modified or supplemented from time to time in accordance with the
terms hereof and thereof. References from or through any date mean, unless
otherwise specified, from and including or through and including, respectively.
The Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by
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the Parties and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any of the provisions of
this Agreement.
2. RESTRUCTURING TRANSACTIONS
Upon the terms and subject to the conditions of this Agreement, on the
Restructuring Closing Date, the following transactions shall occur and shall be
deemed for all purposes to have occurred in the order indicated:
Section 2.01. Company Organizational Matters. The Company's (i) Restated
Certificate of Incorporation in the form of Exhibit A (the "Restated Charter"),
(ii) Amended and Restated Bylaws in the form of Exhibit B and (iii) Stockholder
Agreement in the form of Exhibit C shall be approved by the Company's Board of
Directors. Following approval by the Company's Board of Directors, the Restated
Charter shall be executed and filed in accordance with the applicable provisions
of the Delaware General Corporation Law.
Section 2.02. Dissolution and Liquidation of Alpha Management. By
unanimous vote of its members, Alpha Management shall be dissolved and
liquidated, its assets distributed as provided in Schedule 2.02, its affairs
wound up and a certificate of cancellation shall be filed pursuant to Section
18-203 of the Delaware Limited Liability Company Act.
Section 2.03. Distributions to the AMCI Parties and Fund IX.
(a) Solely for the purposes of effecting the Restructuring Transactions
and notwithstanding any provision to the contrary contained in the LLC
Agreement, the Board of Directors of Holdings shall declare the following
distributions, to be paid in cash or, to the extent the payment is cash is not
permitted by the terms of any credit instrument to which Holdings is a party or
by which it is bound, then such distributions shall be paid in additional Common
Sharing Ratios of Holdings (valued at their fair market value as of the date of
payment determined in accordance with Section 1.3 of the Member Agreement) as
provided below:
(i) to K-M for the benefit of the AMCI Parties the amount of
$6,000,000 representing the incremental Tax resulting from the recognition of
additional Liability for Taxes attributed to ordinary income recapture resulting
from the Restructuring Transactions (the "Incremental Tax"), payable in equal
installments on the dates for which estimated federal income tax payments are
due on each of April 15, 2005, June 15, 2005, September 15, 2005, January 16,
2006 and April 17, 2006; and
(ii) to Fund IX the amount of $4,480,330, representing the
approximate value of certain tax attributes of Fund IX Corp., to be paid as
follows:
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Date Amount
---- ------
December 15, 2007 $2,126,330
December 15, 2008 $2,112,000
December 15, 2009 $ 242,000
(b) Upon completion of the Restructuring Transactions, the Company shall
succeed to the rights and assume and guarantee the obligations of Holdings
pursuant to this Section 2.03 without any further action on the part of the
Company, the AMCI Parties or Fund IX, and to the extent the payment of such
distributions in cash is not permitted by the terms of any credit instrument to
which the Company is a party or by which it is bound, then such distributions
shall be paid in shares of its Common Stock valued in accordance with Section
10.05(j) of this Agreement.
Section 2.04. Contribution of Fund IX Corp. Against delivery of (i)
certificates representing a number of shares of Common Stock issued by the
Company equal to ______% of the Pre-IPO Shares and (ii) a Company Note in the
principal amount of $_____________, and in consideration of the right to
participate in the Over-allotment Distribution, Fund IX shall transfer to the
Company all of the issued and outstanding capital stock of Fund IX Corp.. The
transfer of the Fund IX Corp. capital stock shall be evidenced by appropriate
instruments of transfer in form reasonably satisfactory to the Company.
Section 2.05. Contribution of Membership Interests.
(a) Against delivery of (i) certificates representing an aggregate a
number of shares of Common Stock issued by the Company equal to _______% of the
Pre-IPO Shares and (ii) a Company Note in the principal amount of $___________,
and in consideration of the right to participate in the Over-allotment
Distribution, the AMCI Parties shall transfer to the Company all of the
Membership Interests held by the AMCI Parties as specified in Schedule 2.05A.
(b) Against delivery of (i) certificates representing a number of shares
of Common Stock issued by the Company equal to _______% of the Pre-IPO Shares
and (ii) a Company Note in the principal amount of $___________, and in
consideration of the right to participate in the Over-allotment Distribution,
Fund IX Holdings shall transfer to the Company all of the Membership Interests
held by Fund IX Holdings.
(c) Against delivery of (i) certificates representing a number of shares
of Common Stock issued by the Company equal to ______% of the Pre-IPO Shares,
(ii) a Company Note in the principal amount of $____________, and in
consideration of the right to participate in the Over-allotment Distribution,
Madison shall transfer to the Company all of the Membership Interests held by
Madison.
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(d) Against delivery of certificates representing an aggregate number of
shares of Common Stock issued by the Company equal to _________% of the Pre-IPO
Shares as specified in Schedule 2.05D, and in consideration of the right to
participate in the Over-allotment Distribution, the Management Members shall
transfer to the Company all of the Membership Interests and Profits Interest
held by the Management Members. Those of the Pre-IPO Shares specified on
Schedule 2.05D as "unvested shares" shall be subject to the restrictions
specified in the Stockholder Agreement.
(e) Subsequent to the transfers set forth in Section 2.04 and Sections
2.05(a) through (d), the following shall occur: (a) the Company shall transfer
(i) Membership Interests representing _________% in ANR Holdings to Fund IX Corp
and (ii) the remaining 1% membership interest in ANR Holdings to Alpha NR
Ventures, Inc.; and (b) subsequent to the transfer described in clause (a) of
this Section 2.05(e), the Company shall transfer common shares representing 100%
of the issued and outstanding common shares of Alpha NR Ventures, Inc. to Fund
IX Corp.
(f) The transfer of the Common Sharing Ratios, Preferred Sharing Ratios
and Profits Interest set forth in clauses (a) through (e) above shall be
evidenced by appropriate instruments of transfer in form reasonably satisfactory
to the Company.
Section 2.06. Approval of Restated Charter and LTIP. The Restated Charter
and LTIP shall be deemed to be approved by the Members in their capacities as
stockholders of the Company.
Section 2.07. Conversion of Options and Assumption of Amended and Restated
Alpha Management LTIP. The outstanding options to purchase units of Alpha
Management specified in column 1 of Schedule 2.07 shall become and be converted
into options to purchase shares of the Company's Common Stock specified in
column 2 of Schedule 2.07 (the "Converted Options"), pursuant to the terms of
the Alpha Management LTIP. Effective upon such conversion: (a) the Alpha
Management LTIP shall be deemed to be amended and restated to read in full as
set forth on Exhibit H hereto, which amendment and restatement is hereby
approved by Xxxxxxx X. Xxxxxxx by his signature to this Agreement in his
capacity as the sole member of the "Committee" pursuant to Section 13 of the
Alpha Management LTIP; (b) the Company shall assume the Alpha Management LTIP,
as amended and restated pursuant to this Section, and shall be deemed to have
reserved for issuance thereunder a number of shares of Common Stock equal to the
total number of shares issuable upon exercise of the Converted Options (which
shall be equal to an aggregate of _________% of the Fully Diluted Shares to be
outstanding upon completion of the Public Offering); and (c) the Alpha
Management LTIP, as amended and restated hereby, shall be deemed to be approved
by the Members in their capacities as stockholders of the Company.
Section 2.08. Assumption of Alpha Natural Resources Annual Incentive Bonus
(AIB) Plan. The Company shall assume the Alpha Natural Resources Annual
Incentive Bonus (AIB) Plan (the "AIB") set forth as Exhibit I, and the AIB shall
be deemed to be approved by the Members in their capacity as stockholders of the
Company.
11
Section 2.09. Agreement Regarding Allocation of Shares and Company Notes.
The Parties agree that the allocation of shares of Common Stock and Company
Notes among the Parties pursuant to this Article 2 maintains the relative direct
or (in the case of Fund IX) indirect economic interests of the Parties in
Holdings' assets in place prior to the Restructuring Transactions. In connection
with such acknowledgement, the Parties have agreed that such interests have been
determined based on a hypothetical sale of the net assets of Holdings for an
amount equal to the valuation of the Company in the Public Offering, the
allocation of the resulting hypothetical Liquidity Event Profit pursuant to
Article V of the LLC Agreement, and the hypothetical liquidation of Holdings
following such sale and allocation pursuant to Article X of the LLC Agreement.
Section 2.10. Distributions to Pay Pre-Closing Taxes. Immediately prior to
the Restructuring Closing, Holdings shall make a distribution to its members
pursuant to Section 4.1(b) of the LLC Agreement but only with respect to income
of Holdings allocable to them (i.e., not otherwise "as a result of their
participation in the Company"), which distribution shall be based on estimated
taxable income of Holdings through the Closing Date and shall be determined
consistently with past practice of the Company. Any distribution pursuant to
this section is not intended to compensate any Member for any Tax Liability as a
result of the Restructuring Transactions and shall not include any amounts to
compensate for ordinary income recapture recognized in the Restructuring
Transactions. The Parties agree that taxable income of Holdings shall be
allocated between the portion of the taxable year of Holdings prior to the
Restructuring Closing and following the Restructuring Closing based on a closing
of the books of Holdings as of the close of business on the of the Restructuring
Closing.
3. PUBLIC OFFERING
The Members agree that pursuant to the Public Offering and as of the
Public Offering Closing Date, (a) the Company shall issue and deliver to the
Underwriters shares of its Common Stock representing approximately _________% of
the shares to be outstanding upon completion of the Public Offering (without
giving effect to the exercise by the Underwriters of any over-allotment option),
(b) the entire net proceeds of the shares of the Public Offering to the Company,
immediately upon receipt by the Company, shall be applied by the Company to the
payment in full of principal and accrued interest on the Company Notes, (c) the
Company will grant to the Underwriters an the Over-allotment Option, upon the
exercise of which the Company will make the Over-allotment Distribution, and (d)
pursuant to the LTIP the Board of Directors of the Company shall grant to the
employees of the Company listed on Schedule 3C options to purchase the shares of
the Company's Common Stock at the Public Offering price per share on the terms
indicated on Schedule 3C, which shall represent 1% of the primary shares of
Common Stock outstanding upon completion of the Public Offering.
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4. RESTRUCTURING CLOSING
Section 4.01. Restructuring Closing. The closing (the "Restructuring
Closing") of the transactions contemplated by Article 2 of this Agreement shall
take place at the offices of Bartlit Xxxx Xxxxxx Xxxxxxxxx & Xxxxx LLP, in
Denver, Colorado, on the Restructuring Closing Date beginning at 8:00 a.m.
(local time), or at such other time or place as the Representatives may agree.
Section 4.02 Actions at the Restructuring Closing. At the Restructuring
Closing:
(a) the various certificates, instruments, and documents referred to in
Article 2 shall be executed, delivered and filed as the case may be, with the
effect that the transactions contemplated by Article 2 shall be completed;
(b) each of the Members shall execute and deliver the Stockholder
Agreement in the form of Exhibit D;
(c) each of the appropriate parties shall execute and deliver the
agreements in the forms of Exhibit F-1 through F-3;
(d) each of the appropriate parties shall execute and deliver instruments
reasonably satisfactory to them evidencing the termination of the Terminated
Agreements; and
(d) Fund IX Corp. and the Company shall execute and deliver the Third
Amended and Restated Limited Liability Company Agreement of Holdings in the form
of Exhibit G.
5. REPRESENTATIONS AND WARRANTIES OF THE PARTIES
Each of the Parties represents and warrants as to itself, severally and
not jointly, to each other Party as of the date hereof and as of the
Restructuring Closing Date that:
Section 5.01 Organization of Parties. If it is not a natural person, then
it is a corporation, partnership or limited liability company, as the case may
be, that is duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization.
Section 5.02 Authorization of Transaction. It has full power and authority
(including, where applicable, full power and authority as an organization) to
execute, deliver and perform its obligations under this Agreement and to
execute, deliver and perform its obligations under each other agreement or
instrument (the "Ancillary Agreements and Instruments") to which it is a party
in connection with this Agreement. The execution, delivery and performance of
this Agreement and the execution, delivery and performance of each of the
Ancillary Agreements and Instruments by it in connection with this Agreement and
the transactions contemplated under this Agreement have been
13
duly authorized by all requisite organizational or other action on its part.
This Agreement has been duly executed and delivered by it and all Ancillary
Agreements and Instruments to be executed and delivered by it in connection with
this Agreement have been duly executed and delivered by it as of the date hereof
or will be executed and delivered by it on or prior to the Restructuring Closing
Date. This Agreement constitutes, and when executed and delivered on or prior to
the Restructuring Closing Date, all Ancillary Agreements and Instruments to be
executed and delivered by it pursuant to this Agreement will constitute, its
legal, valid and binding obligation, enforceable in accordance with their
respective terms and conditions, subject, however, to the effects of bankruptcy,
insolvency, reorganization, moratorium or similar Laws affecting creditors'
rights generally, and to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law). Schedule
5.02 sets forth all material notices to, filings with, and all other
authorizations, consents, or approval of Governmental Authorities required to be
made or obtained by it in order to consummate the Restructuring Transactions.
Section 5.03. Noncontravention. Neither the execution, delivery or
performance of this Agreement by it nor the execution, delivery or performance
by it of each Ancillary Agreement and Instrument to which it is a party executed
in connection with this Agreement or delivered pursuant to this Agreement, nor
the consummation of the transactions contemplated hereby or thereby, will (i)
violate any Law to which it is subject or any provision of its Organizational
Documents, (ii) contravene, conflict with or result in a material violation of
any of the terms or requirements of, or give any Governmental Authority the
right to revoke, withdraw, suspend, cancel or terminate any material
authorization or Permit issued by a Governmental Authority that is held it, or
(iii) give any Governmental Authority or other Person the right to challenge any
material portion of the transactions contemplated under this Agreement or
exercise any remedy or obtain any relief that is material under any Law to which
it is subject, or (iv) except as set forth in Schedule 5.03, conflict with,
result in a breach of, constitute a default under, result in the acceleration
of, create in any party the right to accelerate, terminate, modify, cancel or
exercise any material remedy or loss of rights, or result in the creation of any
Lien, or require any notice (in all such cases with or without the giving of
notice and/or the passage of time) under any Material Contract to which it is a
party or by which it is bound or to which any of its assets is subject.
Section 5.04. Brokers' Fees. Except as to the Company or any selling
stockholder as may arise under the Underwriting Agreement, it does not have any
Liability or obligation to pay any fees or commissions to any broker, finder, or
agent with respect to the Restructuring Transactions for which any other Party
could become liable or obligated.
Section 5.05. Investment. If it is acquiring shares of the Company's
Common Stock pursuant to Article 2 of this Agreement, it is not acquiring the
same with a view to, or for sale in connection with, any distribution thereof
within the meaning of the Securities Act. It, together as appropriate with its
directors and executive officers and advisors, (i) is familiar with investments
of the nature of the Common Stock, (ii)
14
understands that this investment involves substantial risks, (iii) has
adequately investigated the Company and the Common Stock to be issued, and (iv)
has substantial knowledge and experience in financial and business matters such
that it is capable of evaluating, and has evaluated, the merits and risks
inherent in acquiring the Common Stock, and is able to bear the economic risks
of such investment. It acknowledges that the shares of Common Stock have not
been registered or qualified under, and are being sold in reliance upon an
exemption from the registration requirements of, the Securities Act, and the
rules and regulations thereunder and any applicable state securities or "Blue
Sky" laws, and may not be offered, sold, transferred, pledged, hypothecated or
otherwise assigned unless they are registered under such securities laws or
regulations or an exemption from such registration is available.
Section 5.06. Ownership of Equity Interests. If it is contributing,
surrendering or exchanging any Equity Interest pursuant to Article 2, Schedule
5.06 sets forth a complete and correct listing of the record and beneficial
ownership of such beneficial interest as to it. Each such Equity Interest has
been duly authorized, and validly issued and fully paid and non-assessable and
are owned solely by it as set forth on Section 5.06. Except to the extent
created under the Securities Act and state securities Laws, or as created by the
respective Organizational Documents, (i) such Equity Interests are held free and
clear of rights of first refusal, restrictions on transfer, Taxes, and
Encumbrances, and (ii) there are no Commitments with respect to such Equity
Interests, other than those contemplated by this Agreement. If it is
contributing, surrendering or exchanging any Equity Interest pursuant to Article
2, it is not a party to any voting trust, proxy, or other agreement or
understanding with respect to voting any such Equity Interest other than as set
forth in Schedule 5.06 or elsewhere in this Agreement.
Section 5.07. Registration Statement. It has read the Registration
Statement and, to its knowledge, the Registration Statement does not contain any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to each other Party as of the date
hereof and as of the Restructuring Closing Date that:
Section 6.01. Capitalization. (a) The authorized capital stock of the
Company consists of 1,000 shares of Common Stock. As of the date of this
Agreement, there are no outstanding shares of Common Stock.
(b) Upon issuance of the Common Stock in the Restructuring Transactions
and the Public Offering, all shares of Common Stock so issued will be duly
authorized, validly issued, and when delivered against payment therefor, will be
fully paid and non-assessable. Except as set forth in this Section 6.01, there
are no outstanding (i) Equity Interests of the Company or (ii) Commitments with
respect to Equity Interests of the
15
Company other than the shares of Common Stock issuable pursuant to the
Over-allotment Option, the Over-allotment Distribution, the LTIP and the Alpha
Management LTIP (the items in Sections 6.01(b)(i) and 6.01(b)(ii) being referred
to collectively as the "Company Securities"). There are no outstanding
obligations of the Company or any Subsidiary to repurchase, redeem or otherwise
acquire or dispose of any Company Securities, other than those created by this
Agreement.
7. REPRESENTATIONS AND WARRANTIES OF HOLDINGS
Holdings represents and warrants to each other Party as of the date hereof
and as of the Restructuring Closing Date that:
Section 7.01. Capitalization. (a) The authorized, issued and outstanding
Membership Interests of Holdings are set forth on Schedule II.
(b) All outstanding Membership Interests of Holdings have been duly
authorized and are fully paid and non-assessable. Except as set forth in
Schedule 7.01, there are no outstanding (i) Equity Interests of Holdings or (ii)
Commitments with respect to Equity Interests of Holdings other than the
Membership Interests issuable pursuant to the Alpha Management LTIP (the items
in Sections 7.01(b)(i) and 7.01(b)(ii) being referred to collectively as the
"Holdings Securities"). There are no outstanding obligations of Holdings or any
Subsidiary to repurchase, redeem or otherwise acquire or dispose of any Holdings
Securities, other than those created by this Agreement.
8. REPRESENTATIONS AND WARRANTIES OF ALPHA MANAGEMENT
Alpha Management represents and warrants to each other Party, and each of
the Management Members represents and warrants as to itself severally and not
jointly to each other Party, as of the date hereof and as of the Restructuring
Closing Date that:
Section 8.01. Capitalization. (a) The authorized, issued and outstanding
membership interests of Alpha Management are set forth on Schedule I.
(b) All outstanding membership interests of Alpha Management have been
duly authorized and are fully paid and non-assessable. Except as set forth in
Schedule I, there are no outstanding (i) Equity Interests of Alpha Management or
(ii) Commitments with respect to Equity Interests of Alpha Management other than
the issuance of membership interests pursuant to the Alpha Management LTIP (the
items in Sections 8.01(b)(i) and 8.01(b)(ii) being referred to collectively as
the "Alpha Management Securities"). Except as set forth in the Management LLC
Agreement, there are no outstanding obligations of Alpha Management or any
Subsidiary to repurchase, redeem or otherwise acquire or dispose of any Alpha
Management Securities, other than those created by this Agreement.
16
9. REPRESENTATIONS AND WARRANTIES OF FUND IX REGARDING FUND IX CORP.
Fund IX represents and warrants to the Company, as of the date hereof and
as of the Restructuring Closing Date that:
Section 9.01 Incorporation and Other Organizational Matters. Fund IX Corp.
(i) is a corporation that is duly organized, validly existing and in good
standing under the Laws of the jurisdiction of its organization, (ii) is duly
authorized to conduct business and is in good standing under the Laws of each
jurisdiction in which it has had an office or in which it paid taxes in past
three years, and (iii) has full power and authority to carry on the businesses
in which it is engaged and to own and use the properties owned and used by it.
The officers and directors of Fund IX Corp. are listed on Schedule 9.01. Fund IX
Corp. has no employees other than its officers.
Section 9.02 Noncontravention. The execution, delivery and performance by
Fund IX of this Agreement and each Ancillary Agreement and Instrument to which
it is a party executed in connection herewith or delivered pursuant to this
Agreement and the consummation of the transactions contemplated in this
Agreement and therein will not, with or without the giving of notice or the
passage of time, or both: (i) violate any Law to which Fund IX Corp. is subject
or any provision of its Organizational Documents; (ii) conflict with, or result
in a violation or breach of, or a default or event of default under, or require
the consent of any other party in order to avoid a default or event of default
under, a right to accelerate, right to exercise any remedy or loss of rights
under, or result in the creation of any Lien under or pursuant to, any provision
of any Fund IX Corp.'s Organizational Documents or of any Material Contract to
which Fund IX Corp. is a party or by which Fund IX Corp. is bound, or any Law or
any order, judgment, writ, injunction or decree to which Fund IX Corp. is a
party or by which Fund IX Corp. may be bound or affected; or (iii) give any
Governmental Authority or other Person the right to challenge any of the
transactions contemplated hereunder or exercise any remedy or obtain any relief
under any Law to which any Fund IX Corp. is subject.
Section 9.03. Capitalization. (a) The authorized capital stock of Fund IX
Corp. consists of 1,000 shares of common stock, $.01 par value per share, and
1,000 shares of preferred stock, $.01 par value per share ("Fund IX Corp.
Preferred Stock"). As of the date hereof, there are outstanding 100 shares of
common stock all of which are held of record by Fund IX and no shares of Fund IX
Corp. Preferred Stock.
(b) All outstanding shares of capital stock of Fund IX Corp. have been
duly authorized and validly issued and are fully paid and non-assessable. Except
as set forth in this Section 9.03, there are no outstanding (i) Equity Interests
of Fund IX Corp. or (ii) Commitments with respect to Equity Interests of Fund IX
Corp. , other than those created by this Agreement (the items in Sections
9.03(b)(i) and 9.03(b)(ii) being referred to collectively as the "Fund IX Corp.
Securities"). There are no outstanding obligations of Fund IX Corp. or any
Subsidiary to repurchase, redeem or otherwise acquire any Fund IX Corp.
Securities, other than those created by this Agreement.
17
Section 9.04. Business of Fund IX Corp. Since its organization, Fund IX
Corp. has engaged in no business activities other than holding Membership
Interests in Holdings and activities incidental thereto and to the Restructuring
Transactions and in preparation of the Public Offering.
Section 9.05. Assets and Liabilities of Fund IX Corp.. Fund IX Corp. (i)
owns no assets other than Membership Interests and those set forth on Schedule
9.05, (ii) has entered into no contracts or agreements other than those
specified on Schedule 9.05, (iii) has no Liability (and, to the Knowledge of
Fund IX, there is no Basis for any present or future action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand against any of them
giving rise to any Liability), except for Liabilities disclosed in the
Registration Statement or that are set forth on Schedule 9.05. For the sake of
clarity, Fund IX makes no representations as to the value of any assets set
forth on Schedule 9.05.
Section 9.06. Restrictions on Business Activities. Except for this
Agreement and its Organizational Documents, there is no agreement, judgment,
injunction, order or decree binding upon Fund IX Corp. that has or would
reasonably be expected to have the effect of prohibiting the conduct of its
business.
10. COVENANTS OF THE PARTIES
Section 10.01. Consent and Agreement. Each Member hereby consents to each
of the Restructuring Transactions and ratifies all actions previously taken by
or on behalf of the Alpha Entities and each of their respective managers,
members, officers and directors in connection with the execution of those steps
of the Restructuring Transactions which were undertaken or completed prior to
the date hereof. Each Member agrees that the receipt by it of the consideration
described in Article 2 is the entirety of the consideration, value or benefit to
which it is entitled as a Member of Holdings (or, in the case of Fund IX, an
indirect Member of Holdings) and/or as a member of Alpha Management, as the case
may be, in connection with the Restructuring Transactions. Each Member waives
any right to any further allocations or distributions under the LLC Agreement or
the Management LLC agreement, as the case may be.
Section 10.02. Release. Effective at the Restructuring Closing, for good
and valuable consideration, the sufficiency of which is hereby acknowledged,
each Member, as to itself or himself, and its or his past, present and future
Affiliates (including Fund IX and the Company on behalf of Fund IX Corp.), and
its and their respective successors, predecessors, assigns, heirs, officers,
directors, members, managers, partners, employees, consultants and trustees,
hereby releases, acquits and forever discharges each Alpha Entity and its past,
present and future Affiliates and its and their respective successors,
predecessors, assigns, heirs, officers, directors, members, managers, partners,
employees, consultants and trustees, in respect of and from any and all debts,
demands, actions, causes of action, suits, accounts, covenants, contracts,
agreements, torts, damages and any and all claims, defenses, offsets, judgments,
demands and liabilities whatsoever, of
18
every name and nature, both at law and in equity, known or unknown, suspected or
unsuspected, accrued or unaccrued, which have been or could have been asserted
against such other Person, which the releasing Person has or ever had which
arise out of or in any way related or are incidental to events, circumstances or
actions taken by such other Person prior to the Restructuring Closing; provided,
however, that the foregoing general release shall not affect (i) any Person's
rights or obligations with respect to this Agreement or any of the Continuing
Agreements to which such Person is a party (ii) or any rights or obligations as
between Alpha Natural Resources, LLC or its subsidiaries, on the one hand, and
the employees of Alpha Natural Resources, LLC and its subsidiaries, on the other
hand.
Section 10.03. Best Efforts; Further Assurances. Subject to the terms and
conditions of this Agreement, each Party will use its best efforts to take, or
cause to be taken, all actions and to do, or cause to be done, all things
necessary or desirable under applicable laws and regulations to consummate the
Restructuring Transactions.
Section 10.04. Indemnification by the Company. (a) The Company shall
indemnify any Person (each, an "Indemnitee") who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding brought by or against Holdings, Alpha Management or any of
their respective Subsidiaries or otherwise, whether civil, criminal,
administrative or investigative, including, without limitation, any action by or
in the right of Holdings, Alpha Management or any of their respective
Subsidiaries to procure a judgment in its favor, by reason of the fact that such
Indemnitee was the managing member, a member, a director, an executive committee
member or an officer of Holdings, Alpha Management or any of their Subsidiaries,
or at the relevant time, having been such a managing member, member, director,
executive committee member or officer, or that such Indemnitee is or was serving
at the request of Holdings, Alpha Management or any of their respective
Subsidiaries as a partner, director, officer or trustee of another Person,
against all Adverse Consequences actually and reasonably incurred by such
Indemnitee in connection with such action, suit or proceeding. Notwithstanding
the forgoing, no indemnification shall be provided to or on behalf of any
Indemnitee if a judgment or other final adjudication adverse to such Indemnitee
establishes that (i) such Indemnitee's acts were committed in bad faith or were
the result of active and deliberate dishonesty and, in either case, were
material to the cause of action so adjudicated or (ii) such Indemnitee in fact
personally gained a financial profit or other advantage to which such Indemnitee
was not legally entitled.
(b) Any indemnification under subsection (a) of this Section 10.04 shall
(unless ordered by a court) be made by the Company only as authorized in the
specific case upon a determination that the indemnification of the Indemnitee is
proper under the circumstances because such Indemnitee has met the applicable
standard of conduct set forth in subsection (a) of this Section 10.05. Such
determination shall be made by the Board of the Directors of the Company in good
faith or, if the Board so directs, by legal counsel of its choice in a written
opinion.
19
(c) The Company may, in the discretion of the Board of Directors of the
Company, pay expenses incurred by any Indemnitee in defending any action, suit
or proceeding described in subsection (a) of this Section 10.04 in advance of
the final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Indemnitee to repay such advance if it shall
ultimately be determined that such Indemnitee is not entitled to be indemnified
by the Company pursuant to this Section 10.05.
(d) The Company may, in the discretion of the Board of Directors of the
Company, purchase and maintain insurance on behalf of any Indemnitee against any
liability asserted against such Indemnitee, whether or not the Company would
have the power by law to indemnify such Indemnitee against such liability.
(e) The indemnification provided by this Section 10.04 shall not be deemed
exclusive of any other rights to indemnification to which those seeking
indemnification may be entitled under any agreement, determination of the Board
of Directors of the Company or otherwise. The rights to indemnification and
reimbursement or advancement of expenses provided by, or granted pursuant to,
this Section 10.04 shall continue as to an Indemnitee who ceased to be a Member
or officer (or other person indemnified hereunder) prior to the Restructuring
Closing and shall inure to the benefit of the executors, administrators,
legatees and distributees of such Person.
Section 10.05. Indemnification by Fund IX. (a) In the event the
Restructuring Closing occurs, and (i) Fund IX breaches any of its
representations and warranties contained in Article 9 for which the applicable
survival period pursuant to Section 13.01 has not expired and (ii) the Company
makes, in good faith, a written claim for indemnification against Fund IX
pursuant to this Section 10.05 within any such survival period, then Fund IX
agrees to indemnify the Company and hold it harmless from and against the
entirety of the Adverse Consequences caused by the breach and suffered by the
Company through and after the date of the claim for indemnification, subject to
the limitations set forth herein.
(b) The following limitations shall apply with regard to Fund IX's
obligations to indemnify the Company pursuant to Section 10.05(a):
(i) Fund IX's Liability for the matters described under Section
10.05(a) of this Agreement shall not exceed a maximum of $15,000,000 for all
Adverse Consequences as to which the Company has made a written claim for
indemnification prior to the second anniversary of the Restructuring Closing
Date, declining to a maximum of $10,000,000 for all Adverse Consequences as to
which the Company has made a written claim for indemnification after to the
second anniversary of the Restructuring Closing Date and prior to the fourth
anniversary of the Restructuring Closing Date.
(ii)Fund IX will have no Liability for any Adverse Consequences,
unless and until the aggregate Adverse Consequences (after taking into account
the present value
20
(discounted by 8%) of any Tax Benefit presently quantifiable with certainty by,
and insurance and indemnity proceeds presently quantifiable with certainty to,
the indemnified party with respect thereto) for which the Company is entitled to
recover under this Agreement exceeds $100,000 (the "Threshold Amount"), after
which the Company will be entitled to recover all amounts to which it is
entitled to indemnification under this Section 10.05 (less such present value of
Tax Benefits and insurance and indemnity proceeds) to the extent such Adverse
Consequences exceed the Threshold Amount(subject to the limitation in Section
10.05(b)(i)). In calculating the Threshold Amount for the Adverse Consequences
under this Section, all Adverse Consequences which individually total less than
$50,000 (taking such present value of Tax Benefits and insurance and indemnity
proceeds into account) shall be excluded in their entirety and Fund IX shall
have no Liability hereunder to the Company for such Adverse Consequences;
provided that for purposes of this sentence, the Adverse Consequences from any
events or actions resulting from the same or substantially similar occurrences
shall be aggregated.
(iii) The Company acknowledges and agrees that, except as set forth
below, the indemnification provisions in this Section 10.05 shall be the
exclusive remedy of the Company with respect to the representations and
warranties of Fund IX made in Article 9.
(iv) Fund IX shall not be liable for Adverse Consequences to the
extent they arose from (A) a change in Law, accounting pronouncements or Tax
policy or practice made after the Restructuring Closing Date or (B) any
legislation not in force on the Restructuring Closing Date.
(v) Fund IX shall not be liable under this Section 10.05 for an
amount to the extent, if any, that any Adverse Consequences giving rise to such
amount results from a failure on the part of the Company to exercise good faith
in not jeopardizing or prejudicing the interests of Fund IX.
(vi) The Company shall not be entitled to indemnification under this
Section 10.05 for Adverse Consequences arising out of or relating to breach of
any representation or warranty in Article 9 if Fund IX can establish that the
Company or any member of Alpha Management had actual knowledge before the
Restructuring Closing Date of facts or circumstances which would cause the
representation or warranty to be untrue.
(vii) It is understood and agreed by the Company and the Parties
that no director, officer, employee, agent, partner, stockholder or Affiliate of
Fund IX (including any stockholder, partner, director, officer, employee, agent
or Affiliate of a stockholder including any officer or director of Fund IX
Corp.) shall have (A) any personal liability to the Company as a result of the
breach of any representation, warranty, covenant or agreement of Fund IX
contained in this Agreement or (B) any personal obligation to indemnify the
Company for any of their claims pursuant to this Section 10.06, and the Company
hereby waives and releases and shall have no recourse against any of such
parties described in this Section 10.05(b)(vii) as a result of the breach of any
21
representation, warranty, covenant or agreement of Fund IX contained herein or
otherwise arising out of or in connection with the Restructuring Transactions.
(viii) The Parties further understand and agree that any liability
of Fund IX for indemnity pertaining to Tax liabilities of Fund IX Corp. shall be
reduced by the excess, if any, of the cumulative tax liability of Fund IX Corp.
incurred as a result of its ownership of its Membership Interests over the
distributions that Fund IX Corp. received pursuant to Section 4.1(b) of the LLC
Agreement and Section 2.09 hereof.
(c) The Company may make a claim (not involving a Third Party Claim) in
any amount to which it may be entitled under this Section 10.05 by providing a
written claim for indemnification against Fund IX within any applicable survival
period promptly after the Company has notice of any Adverse Consequence which
may give rise to a claim for indemnification; provided, however, that no delay
on the part of the Company in notifying Fund IX shall relieve Fund IX from any
obligation hereunder unless (and then solely to the extent) Fund IX is
prejudiced by such delay.
(d) If any third party shall notify the Company with respect to any matter
(a "Third Party Claim") that may give rise to a right to claim for
indemnification against Fund IX under this Section 10.05, then the Company shall
promptly (and in any event within five (5) business days after receiving notice
of the Third Party Claim) notify Fund IX thereof in writing (the "Claim
Notice"); provided, however, that no delay on the part of the Company in
notifying Fund IX shall relieve Fund IX from any obligation hereunder unless
(and then solely to the extent) Fund IX is adversely affected in its ability to
defend against such Claim or is otherwise prejudiced thereby.
(e) Fund IX will have the right to assume and thereafter conduct the
defense of the Third Party Claim with counsel of its choice reasonably
satisfactory to the Company so long as (i) Fund IX notifies the Company in
writing (within twenty (20) days after the Company has given the Claim Notice)
that Fund IX will fulfill its indemnification obligations hereunder and provides
the Company with evidence reasonably acceptable to the Company that Fund IX will
have the financial resources to defend against the Third Party Claim and fulfill
its indemnification obligations hereunder, (ii) the Third Party Claim involves
only money damages and does not seek an injunction or other equitable relief,
and (iii) Fund IX conducts the defense of the Third Party Claim actively and
diligently.
(f) So long as Fund IX is conducting the defense of the Third Party Claim
in accordance with Section 10.05(e), (i) the Company may retain separate
co-counsel at its sole cost and expense and participate in the defense of the
Third Party Claim, (ii) the Company will not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim
without the prior written consent of Fund IX (not to be withheld unreasonably),
and (iii) Fund IX will not consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without the prior written
consent of the Company, except in the cases involving only money damages which
are not likely to establish a precedential custom or practice adverse to the
continuing business interests of the Company.
22
(g) In the event any of the conditions in Section 10.05(f) is or becomes
unsatisfied, however, (i) the Company may defend against, and consent to the
entry of any judgment or enter into any settlement with respect to, the Third
Party Claim only with consent from Fund IX not to be unreasonably withheld),
(ii) Fund IX will reimburse the Company promptly and periodically for the costs
of defending against the Third Party Claim (including reasonable attorneys' fees
and expenses if the Company delivers an undertaking to repay if not ultimately
entitled to indemnification), and (iii) the Indemnifying Parties will remain
responsible, subject to the terms and limitations set forth in this Article
VIII, for any Adverse Consequences the Company may suffer resulting from,
arising out of, relating to, in the nature of, or caused by the Third Party
Claim to the fullest extent provided in this Agreement.
(h) The Adverse Consequences giving rise to any indemnification obligation
hereunder shall be limited to the actual loss suffered by the Company (i.e.,
reduced by the present value (discounted at 8%) of any insurance proceeds or
other payment or recoupment presently realizable with reasonable certainty for
the benefit of the Company as a result of the events giving rise to the claim
for indemnification), net of the present value (discounted at 8%) of any Tax
Benefit of the Company (or the affiliated group of which it is a member)
presently quantifiable based on projected results occasioned by such loss or
damage and such loss or damage shall include all Adverse Consequences suffered
through and after the date of the claim for indemnification (including any
Adverse Consequences suffered after the end of any applicable survival period).
Upon the request of Fund IX, the Company shall provide Fund IX with information
sufficient to allow Fund IX to calculate the amount of the indemnity payment in
accordance with this Section 10.06(h). The Company shall take commercially
reasonable steps to mitigate damages in respect of any claim for which it is
seeking indemnification and shall use commercially reasonable efforts to (i)
avoid any costs or expenses associated with such claim, (ii) to minimize the
amount thereof if such costs and expenses cannot be avoided and (iii) maximize
the amount of any insurance or indemnity proceeds and Tax Benefits..
(i) Upon making payment for an indemnification claim pursuant to this
Section 10.05, Fund IX shall be subrogated, to the extent of such payment, to
any rights which the Company may have against any other Person or escrow account
or deposit with respect to the subject matter underlying such indemnification
claim. If the Company shall receive the benefit of insurance and indemnity
proceeds in excess of the amount taken into consideration in the computation of
Adverse Consequences under Section 10.06(b)(ii), the Company shall promptly
remit such excess proceeds to Fund IX.
(j) Fund IX may, at its option, settle any indemnity obligation owed under
this Section 10.05 either (i) in cash, (ii) by surrender to the Company of
shares of Common Stock having a value equal to the fair market value, as
determined by reference to the closing sale price, or average of the closing bid
and asked quotations, on the trading day preceding the day such payment is made
on the principal trading market on which the Common Stock is traded, and if not
so traded, fair market value shall be determined in the good faith judgment of
the Board of Directors of the Company or (iii) a combination of cash and
surrender of shares of Common Stock valued as provided in clause (ii) of this
Section 10.05(j).
23
11. CONDITIONS
Section 11.01. Conditions to Obligations of Each Party. The obligations of
each Party to consummate the Restructuring Transactions are subject to the
satisfaction or, to the extent permissible by law, waiver of the following
conditions:
(a) no provision of any applicable law or regulation and no judgment,
injunction, order or decree shall prohibit the consummation of the Restructuring
Transactions;
(b) any applicable waiting period under the HSR Act relating to the
Restructuring Transactions shall have expired or been terminated;
(c) the shares of Common Stock to be issued in the Public Offering shall
have been approved for listing on the New York Stock Exchange, subject to
official notice of issuance;
(d) all actions by or in respect of, or filings with, any Governmental
Authority required to permit the consummation of the Restructuring Transactions,
shall have been taken, made or obtained;
(e) this Agreement and the Restructuring Transactions shall have been
approved by the lenders to Alpha Natural Resources, LLC under that certain
Credit Agreement dated as of May 28, 2004, as amended; and
(f) such Party shall be reasonably satisfied that the Registration
Statement will be declared effective by the SEC on the next business day
following the Restructuring Closing Date..
Section 11.02. Conditions to the Obligations of the Alpha Entities. The
obligations of the Alpha Entities to consummate the Restructuring Transactions
are subject to the satisfaction of the following further conditions:
(a) each other Party shall have performed in all material respects all of
its obligations hereunder required to be performed by it at or prior to the
Restructuring Closing;
(b) the representations and warranties of each other Party contained in
this Agreement shall be true at and as of the Restructuring Closing as if made
at and as of such time; and
(c) the AMCI Parties shall have provided to the Company a letter of credit
or similar financial instrument from a financial institution, and in a form,
reasonably satisfactory to the Company securing the obligations of the AMCI
Parties with respect to clauses (ix) and (xxiii) of the definition of "Retained
Liabilities" in Section 1.1 of the Contribution Agreement dated December 31,
2002, as amended, among ANR Holdings, LLC, and the FRC Parties and the AMCI
Parties named therein, which shall permit the Company to draw a maximum of $6.8
million through the fifth anniversary of the
24
Restructuring Closing date, declining to a maximum of $3.8 million through
seventh anniversary of the Restructuring Closing Date, and further declining to
a maximum of $1.8 million through the tenth anniversary of the Restructuring
Closing Date.
Section 11.03. Conditions to the Obligations of Each Member. The
obligations of each Member to consummate the Restructuring Transactions are
subject to the satisfaction of the following further conditions:
(a) each other Party shall have performed in all material respects all of
its obligations hereunder required to be performed by it at or prior to the
Restructuring Closing, and
(b) the representations and warranties of each other Party contained in
this Agreement shall be true in all material respects at and as of the
Restructuring Closing as if made at and as of such time.
12. TERMINATION
Section 12.01. Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time prior to the
Restructuring Closing (notwithstanding any approval of this Agreement by the
Company or any of the Members):
(a) by mutual written agreement of the Parties; or
(b) by the Alpha Entities, if:
(i) the Restructuring Transactions have not been consummated on or
before _________, 2005. (the "End Date");
(ii) (A) there shall be any law or regulation that makes
consummation of the transactions contemplated hereby illegal or otherwise
prohibited, or (B) any judgment, injunction, order or decree of any court or
governmental body having competent jurisdiction enjoining the Alpha Entities
from consummating the transactions contemplated hereby is entered; or
(iii) a breach of any representation or warranty or failure to
perform any covenant or agreement on the part of any Member set forth in this
Agreement shall have occurred that would cause any condition set forth in
Section 11.01 or Section 11.02 not to be satisfied, and such condition is
incapable of being satisfied by the End Date.
The Party or Parties desiring to terminate this Agreement pursuant to this
Section 12.01 shall give notice of such termination to the other Parties.
Section 12.02. Effect of Termination. If this Agreement is terminated
pursuant to Section 12.01, this Agreement shall become void and of no effect,
without liability of any
25
Party (or any stockholder, director, officer, employee, agent, consultant or
representative of such Party) to the other Parties hereto. The provisions of
this Section 12.02 and Sections 13.05, 13.06, 13.07, 13.08 and 13.09 shall
survive any termination pursuant to Section 12.01.
13. MISCELLANEOUS
Section 13.01. Survival. Except for the representations and warranties of
Fund IX made in Article 9, which shall survive until the fourth anniversary of
the Restructuring Closing Date, the representations and warranties of the
Parties contained in this Agreement or in any certificate or other writing
delivered pursuant hereto or in connection herewith shall survive the
Restructuring Closing until the first anniversary of the Restructuring Closing
Date. The covenants and agreements of the Parties contained in this Agreement or
in any certificate or other writing delivered pursuant hereto or in connection
herewith shall survive the Restructuring Closing indefinitely or for the shorter
period explicitly specified therein, except that for such covenants and
agreements that survive for such shorter period, breaches thereof shall survive
indefinitely or until the latest date permitted by law.
Section 13.02. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile transmission) and
shall be given,
If to the Company:
Alpha Natural Resources, Inc.
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
With a copy to:
Bartlit Xxxx Xxxxxx Xxxxxxxxx & Xxxxx LLP
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
If to Holdings:
ANR Holdings, LLC
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
26
With a copy to:
Bartlit Xxxx Xxxxxx Xxxxxxxxx & Xxxxx LLP
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
If to the FRC Parties or the FRC Representative:
First Reserve Corporation
Xxx Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxxx
First Reserve Corporation
Xxx Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
If to the AMCI Parties or the AMCI Representative:
American Metals & Coal International, Inc.
000 Xxxxxxxxx Xxxx, 0xx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, President
Facsimile No.: (000) 000-0000
with a copy to:
American Metals & Coal International, Inc.
Xxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Executive Vice President
Facsimile No.: (000) 000-0000
and to:
XxXxxxx Xxxxx LLP
One Xxxxx Center
000 Xxxx Xxxx Xxxxxx
00
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
Facsimile No. (000) 000-0000
If to Madison:
Madison Capital Funding LLC
000 X. Xxxxxxx Xx. Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx, Managing Director
Facsimile No. (000) 000-0000
If to Alpha Management:
Alpha Coal Management, LLC
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
If to the Management Members or the Management Representative:
Xxxxxxx X. Xxxxxxx
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
or to such other address or facsimile number as such party may hereafter specify
for the purpose of notice to the other parties hereto. All such notices,
requests and other communications shall be deemed received on the date of
receipt by the recipient thereof if received prior to 5:00 p.m. in the place of
receipt and such day is a Business Day in the place of receipt. Otherwise, any
such notice, request or communication shall be deemed not to have been received
until the next succeeding Business Day in the place of receipt.
Section 13.03. Amendments and Waivers. Any provision of this Agreement may
be amended or waived if, but only if, such amendment or waiver is in a writing
referring to Section 13.03 of this Agreement and is signed, in the case of an
amendment, by each Party to this Agreement or such Party's Representative, or in
the case of a waiver, by the Party against whom the waiver is to be effective.
No failure or delay by any 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. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.
28
Section 13.04. Expenses. Except as otherwise provided herein, all costs
and expenses incurred in connection with this Agreement shall be paid by the
Party incurring such cost or expense.
Section 13.05. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the Parties hereto and their
respective successors and assigns; provided that no Member may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the prior written consent of Holdings.
Section 13.06. Governing Law. This Agreement shall be governed by and
construed in accordance with the law of the State of Delaware, without regard to
the conflicts of law rules of such state.
Section 13.07. Arbitration. Any dispute, controversy or claim arising out
of or relating to this Agreement, excluding any dispute or disagreement for
which a dispute resolution process is provided elsewhere in this Agreement (a
"Dispute"), shall be decided by binding arbitration in accordance with the
commercial arbitration rules of the American Arbitration Association. The
Parties to the dispute shall jointly select one arbitrator. If the Parties shall
fail to select an arbitrator within fourteen (14) calendar days after
arbitration is requested, then such arbitrator shall be selected by the American
Arbitration Association or any successor thereto upon application of any Party.
No Dispute shall be consolidated in any arbitration with any dispute, claim or
controversy of any other Party. The arbitration shall be conducted in Greenwich,
Connecticut and any court having jurisdiction thereof may immediately issue
judgment on the arbitration award. The Parties agree that the arbitration
provided for in this Section 13.07 shall be the exclusive means to resolve all
Disputes.
Section 13.08. Counterparts; Effectiveness; Third Party Beneficiaries.
This Agreement may be signed in any number of counterparts, each of which shall
be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument. This Agreement shall become effective when each
Party hereto shall have received a counterpart hereof signed by all of the other
Parties hereto. Until and unless each Party has received a counterpart hereof
signed by the other Party hereto, this Agreement shall have no effect and no
Party shall have any right or obligation hereunder (whether by virtue of any
other oral or written agreement or other communication). No provision of this
Agreement is intended to confer any rights, benefits, remedies, obligations or
liabilities hereunder upon any Person other than the Parties and their
respective successors and assigns.
Section 13.09. Entire Agreement. This Agreement and the Continuing
Agreements constitute the entire agreement between the Parties with respect to
the subject matter of this Agreement and supersede all prior agreements and
understandings, both oral and written, between the Parties with respect to the
subject matter of this Agreement.
29
Section 13.10. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any Party. Upon such
a determination, the Parties 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 in order that the transactions contemplated
hereby be consummated as originally contemplated to the fullest extent possible.
Section 13.11. Specific Performance. The Parties hereto agree that
irreparable damage would occur if any provision of this Agreement were not
performed in accordance with the terms hereof and that the Parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
or to enforce specifically the performance of the terms and provisions hereof in
the courts specified in Section 13.07, in addition to any other remedy to which
they are entitled at law or in equity.
Section 13.12. AMCI Representative. By the execution and delivery of this
Agreement, each of the AMCI Parties hereby constitutes and appoints the AMCI
Representative as the true and lawful agent and attorney-in-fact of the AMCI
Parties with full power of substitution to act in the name, place and stead of
the AMCI Parties with respect to the contribution to the Company and sale to
Fund IX Corp. of the Holdings Common Sharing Ratios and Preferred Sharing Ratios
by the AMCI Parties in accordance with the terms and provisions of this
Agreement, and to act on behalf of the AMCI Parties in any litigation or
arbitration involving this Agreement, do or refrain from doing all such further
acts and things, and execute all such documents as the AMCI Representative shall
deem necessary or appropriate in connection with the Restructuring Transactions
including, without limitation, the power:
(a) to act for the AMCI Parties with regard to matters pertaining to
indemnification referred to in this Agreement, including the power to compromise
any indemnity claim on behalf of the AMCI Parties and to transact matters of
litigation;
(b) to execute and deliver all waivers under and amendments to this
Agreement, ancillary agreements, certificates and documents that the AMCI
Representative deems necessary or appropriate in connection with the
consummation of the Restructuring Transactions;
(c) to receive funds for the payment of expenses of the AMCI Parties and
apply such funds in payment for such expenses; and
(d) to do or refrain from doing any further act or deed on behalf of the
AMCI Parties that the AMCI Representative deems necessary or appropriate in its
sole discretion relating to the subject matter of this Agreement as fully and
completely as the AMCI Parties could do if personally present.
30
The other Parties and any other Person may conclusively and absolutely rely,
without inquiry, upon any action of the AMCI Representative in all matters
referred to herein. All notices required to be made or delivered by to the AMCI
Parties shall be made to the AMCI Representative for the benefit of the AMCI
Parties and shall discharge in full all notice requirements of the Company or
the other Parties with respect thereto.
Section 13.13. Management Members Representative. By the execution and
delivery of this Agreement, each of the Management Members hereby constitutes
and appoints the Management Representative as the true and lawful agent and
attorney-in-fact of the Management Members with full power of substitution to
act in the name, place and stead of the Management Members with respect to the
contribution of the Holdings Common Sharing Ratios and Profits Interest by the
Management Members to the Company in accordance with the terms and provisions of
this Agreement, and to act on behalf of the Management Members in any litigation
or arbitration involving this Agreement, do or refrain from doing all such
further acts and things, and execute all such documents as the Management
Representative shall deem necessary or appropriate in connection with the
Restructuring Transactions including, without limitation, the power:
(a) to act for the Management Members with regard to matters pertaining to
indemnification referred to in this Agreement, including the power to compromise
any indemnity claim on behalf of the Management Members and to transact matters
of litigation;
(b) to execute and deliver all waivers under and amendments to this
Agreement, ancillary agreements, certificates and documents that the Management
Representative deems necessary or appropriate in connection with the
consummation of the Restructuring Transactions;
(c) to receive funds for the payment of expenses of the Management Members
and apply such funds in payment for such expenses; and
(d) to do or refrain from doing any further act or deed on behalf of the
Management Members that the Management Representative deems necessary or
appropriate in its sole discretion relating to the subject matter of this
Agreement as fully and completely as the Management Members could do if
personally present.
The other Parties and any other Person may conclusively and absolutely rely,
without inquiry, upon any action of the Management Representative in all matters
referred to herein. All notices required to be made or delivered by to the
Management Members shall be made to the Management Representative for the
benefit of the Management Members and shall discharge in full all notice
requirements of the other Parties to the Management Members with respect
thereto.
Section 13.14. FRC Representative. By the execution and delivery of this
Agreement, each of the FRC Parties hereby constitutes and appoints the FRC
31
Representative as the true and lawful agent and attorney-in-fact of the FRC
Parties with full power of substitution to act in the name, place and stead of
the FRC Parties with respect to the contribution to the Company of all the
capital stock of Fund IX Corp. by the FRC Parties in accordance with the terms
and provisions of this Agreement, and to act on behalf of the FRC Parties in any
litigation or arbitration involving this Agreement, do or refrain from doing all
such further acts and things, and execute all such documents as the FRC Parties
shall deem necessary or appropriate in connection with the Restructuring
Transactions including, without limitation, the power:
(a) to act for the FRC Parties with regard to matters pertaining to
indemnification referred to in this Agreement, including the power to compromise
any indemnity claim on behalf of the FRC Parties and to transact matters of
litigation;
(b) to execute and deliver all waivers under and amendments to this
Agreement, ancillary agreements, certificates and documents that the FRC
Representative deems necessary or appropriate in connection with the
consummation of the Restructuring Transactions;
(c) to receive funds for the payment of expenses of the FRC Parties and
apply such funds in payment for such expenses; and
(d) to do or refrain from doing any further act or deed on behalf of the
FRC Parties that the FRC Representative deems necessary or appropriate in its
sole discretion relating to the subject matter of this Agreement as fully and
completely as the FRC Parties could do if personally present.
The other Parties and any other Person may conclusively and absolutely rely,
without inquiry, upon any action of the FRC Representative in all matters
referred to herein. All notices required to be made or delivered by to the FRC
Parties shall be made to the FRC Representative for the benefit of the FRC
Parties and shall discharge in full all notice requirements of the other Parties
to the FRC Parties with respect thereto.
Section 13.15. Limited Right of Rescission. If by the close of business
(New York time) on the fifth Business Day following the Restructuring Closing
Date (the "Unwinding Date"), the Public Offering Closing Date has not occurred
as provided in the Underwriting Agreement, the Restructuring Transactions shall
be rescinded nunc pro tunc without any further action by the Parties. Upon a
rescission under this Section 13.15, the Parties shall take all steps considered
necessary or desirable by Holdings to restore the status quo ante existing prior
to the Restructuring Closing Date, as if the Restructuring Transactions,
including the transfers pursuant to Article 2, had never occurred. As such, no
later than the first Business Day following the Unwinding Date: (i) all property
transferred by the Members to the Company and the benefits and burdens of
ownership of such property accruing to the Company from the Restructuring
Closing Date to Unwinding Date shall be returned and remitted to the Members and
the Members shall be readmitted as Members of Holdings with respect to the
Membership Interests in Holdings returned and remitted to the Members and the
stock of Fund IX Corp. shall be
32
returned to Fund IX; (ii) all Common Stock issued to the Members, and the
benefits and burdens of ownership of such Common Stock accruing to the Members
from the time of the Restructuring Closing Date to Unwinding Date, shall be
returned to the Company; (iii) all agreements and undertakings to perform this
Agreement at and after the Restructuring Closing Date (other than the agreements
and undertakings set forth in this Section 13.15) shall be discharged with no
liability to any Party, and (iv) all of the Terminated Agreements shall be
reinstated as if never terminated, and any modifications to the LLC Agreement
pursuant to Section 13.16 shall rescinded, as necessary to achieve the intent of
this Section 13.15.
Section 13.16. Amendment to LLC Agreement. Any provisions of the LLC
Agreement inconsistent with the provisions of this Agreement are hereby deemed
amended to the extent necessary to be consistent with the provisions of this
Agreement.
[SIGNATURE PAGES FOLLOW.]
33
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
ANR HOLDINGS, LLC ALPHA COAL MANAGEMENT, LLC
By:__________________________ By:_____________________________________
Name: Xxxxxxx J, Xxxxxxx Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Executive Title: President
Officer
ALPHA NATURAL RESOURCES, INC. ALPHA NR VENTURES, INC.
By:__________________________ By:_____________________________________
Name: Xxxxxxx X. Xxxxxxx Name: Xxxxxxx J, Xxxxxxx
Title: President and Chief Executive Title: President and Chief Executive
Officer Officer
ANR FUND IX HOLDINGS, L.P. FIRST RESERVE FUND IX, L.P.
By: First Reserve GP IX, L.P. General By: First Reserve GP IX, L.P. General
Partner of ANR Fund IX Holdings, L.P. Partner of First Reserve Fund IX, L.P.
By: First Reserve GP IX, Inc. Its By: First Reserve GP IX, Inc. Its
General Partner General Partner
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxxxx Name: Xxxx X. Xxxxxxx
Title: Managing Director Title: Managing Director
VOLLOW RESOURCES LLC REDBANK, INC.
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
REI, INC. STILL RUN COAL COMPANY, INC.
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
SIGNATURE PAGE TO INTERNAL RESTRUCTURING AGREEMENT
CREEKSIDE ENERGY DEVELOPMENT COMPANY NEWHALL POCAHONTAS ENERGY, INC.
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
SCM, INC. TANOMA ENERGY, INC.
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
MADISON MINING COMPANY LLC I-22 PROCESSING, INC.
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
LAUREL ENERGY, LP, BY LAUREL RESOURCES, LP, BY
LAUREL MOUNTAIN MANAGEMENT, INC., LAUREL MOUNTAIN MANAGEMENT, INC.,
ITS GENERAL PARTNER ITS GENERAL PARTNER
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
DUNAMIS RESOURCES, INC. RRD, INC.
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxx
Title: President Title: President
BETA RESOURCES, LLC MADISON CAPITAL FUNDING LLC
By:__________________________ By:_____________________________________
Name: Xxxx X. Xxxxx Name: Xxxxxx Xxxxxxxx
Title: President Title: Managing Director
SIGNATURE PAGE TO INTERNAL RESTRUCTURING AGREEMENT
_____________________________
Xxxxxxx X. Xxxxxxx
_____________________________
Xxxxxxx X. Xxxxxxx
_____________________________
Xxxxxxx X. Xxxxx
_____________________________
Xxxxx X. Xxxxxxxxxxx
_____________________________
Xxx Xxxxx Xxxxxxxxx, Xx.
_____________________________
Xxxxxx Xxxxxxx Xxxxxx
_____________________________
Xxxxxx X. Xxxxxx
_____________________________
D. Xxxxx Xxxx
_____________________________
Xxxxx X. Xxxxx
_____________________________
Xxxxx X. Xxxxxx
SIGNATURE PAGE TO INTERNAL RESTRUCTURING AGREEMENT
