FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT 10.9
This Assignment and Assumption Agreement (this “Agreement”), dated as of , 2007, is
entered into by and among Quest Resource Corporation, a Nevada corporation (“QRC”), Bluestem
Pipeline, LLC, a Delaware limited liability company (“Bluestem”), and Quest Energy Partners, L.P.
(“Quest Energy”).
RECITALS:
A. | QRC and Bluestem are parties to that certain Midstream Services and Gas Dedication Agreement dated December 22, 2006, but effective as of December 1, 2006, as amended by that certain Amendment No. 1 to the Midstream Services and Gas Dedication Agreement dated August 9, 2007 (“Midstream Services Agreement”). Terms used but not defined herein shall have the respective meanings assigned to them in the Midstream Services Agreement. |
B. | QRC has formed Quest Energy in order to create a master limited partnership structure to effectuate an initial public offering (“IPO”) of QRC’s exploration and production assets located in the Cherokee Basin. |
C. | In connection with the IPO, QRC, Quest Energy, Quest Energy GP, LLC (the “GP”), and Quest Cherokee, LLC (the “Operating Company”) will enter into an Underwriting Agreement (the “Underwriting Agreement”) with Wachovia Capital Markets, LLC and RBC Capital Markets Corporation, as representatives of several underwriters (the “Underwriters”), pursuant to which Quest Energy will sell to the Underwriters 8,750,000 common units of Quest Energy, with an option for the Underwriters to purchase up to 1,312,500 additional common units. |
D. | As a condition to closing of the IPO, the Underwriting Agreement requires that Quest Energy become a party to the Midstream Services Agreement, which will address the provision by Bluestem of certain midstream services to Quest Energy and its subsidiaries. |
E. | The parties to this Agreement desire to assign QRC’s rights under the Midstream Services Agreement to Quest Energy, cause Quest Energy to assume all liabilities and obligations of QRC arising under the Midstream Services Agreement from and after the assignment of this Agreement (other than liabilities or obligations arising out of any breach of the Midstream Services Agreement by QRC occurring prior to such assignment) and release QRC from any such liabilities and obligations under the Midstream Services Agreement. |
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereby
agree as follows:
1. Assignment. QRC hereby assigns and transfers to Quest Energy, effective as of the
closing of the transactions contemplated under the Underwriting Agreement (the “Closing”), all of
QRC’s right, title and interest in and to the Midstream Services Agreement.
2. Assumption. Effective as of the Closing, Quest Energy accepts the assignment and
hereby assumes the Midstream Services Agreement and all of QRC’s obligations, duties,
responsibilities and liabilities thereunder to be observed, kept, performed or complied with by QRC
from and after the Closing (excluding any liabilities or obligations arising out of any breach of
the Midstream Services Agreement by QRC prior to the Closing) and to succeed to QRC’s obligations
and to be bound by the terms and conditions of the Midstream Services Agreement from and after the
Closing.
3. Representation and Warranties. QRC and Bluestem each hereby severally represent,
warrant and covenant, as to such party only, to Quest Energy as follows:
(a) The Midstream Services Agreement is in full force and effect and constitutes QRC’s
and Bluestem’s valid and binding obligations enforceable against each in accordance with its
terms, there have been no amendments to or modifications to the Midstream Services Agreement
(except for Amendment No. 1), and neither QRC nor Bluestem has claims or defenses against
the other with respect to the Midstream Services Agreement.
(b) No other assignment of the Midstream Services Agreement has been made by QRC or
Bluestem.
(c) Each of QRC and Bluestem has complete and unrestricted power and authority to enter
into this Agreement.
4. Consent and Novation. Bluestem hereby (a) consents to the assignment of the
Midstream Services Agreement, (b) agrees that upon such assignment, Quest Energy will enjoy the
rights of QRC under the Midstream Services Agreement as of the Closing and arising thereafter, and
(c) effective as of the Closing, forever and unconditionally releases and discharges QRC and its
affiliates (except for Quest Energy, the GP, the Operating Company, Quest Midstream Partners, L.P.,
Quest Midstream GP, LLC and Bluestem), servants, agents, officers, directors, assigns, predecessors
and successors (collectively, the “Covered Persons”), from any and all claims, demands,
obligations, liabilities, actions, causes of actions, indebtedness, responsibilities, in connection
with or arising out of, resulting from or in any way relating to the Midstream Services Agreement
(whether known or unknown, liquidated or unliquidated, contingent or non-contingent, secured or
unsecured), other than those arising out of any breach of the Midstream Services Agreement by QRC
prior to the Closing.
5. Indemnification. QRC does hereby agree to indemnify, defend and hold harmless
Quest Energy from and against any and all liability, loss, damage, cost or expense, including
reasonable attorney’s fees, which Quest Energy may suffer or incur by reason of any breach of the
Midstream Services Agreement occurring or accruing prior to the Closing.
6. Amendments. This Agreement shall not be amended or modified except (a) by an
instrument in writing signed by, or on behalf of, QRC, Bluestem and Quest Energy or (b) by a waiver
pursuant to Section 9 below.
7. No Third Party Beneficiaries. This Agreement shall be binding upon and inure
solely to the benefit of the parties hereto and their permitted assigns, and nothing herein,
express
or implied, other than Section 4 (which is expressly for the benefit of the Covered Persons
and may be enforced by them), is intended to or shall confer upon any other person any legal or
equitable right, benefit or remedy of any nature whatsoever.
8. Severability. If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any law or public policy, all other terms and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated by this Agreement is not affected in any manner
materially adverse to any party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties as closely as possible
in an acceptable manner in order that the transactions contemplated by this Agreement are
consummated as originally contemplated to the greatest extent possible.
9. Waiver. Any party to this Agreement may (a) extend the time for the performance of
any of the obligations or other acts of another party, (b) waive any inaccuracies in the
representations and warranties of the other party contained herein or in any document delivered by
the other party pursuant hereto or (c) waive compliance with any of the agreements of the other
party or conditions to such party’s obligations contained herein. Any such extension or waiver
shall be valid only if set forth in an instrument in writing signed by the party to be bound
thereby. Any waiver of any term or condition shall not be construed as a waiver of any subsequent
breach or a subsequent waiver of the same term or condition, or a waiver of any other term or
condition of this Agreement. The failure of any party to assert any of its rights hereunder shall
not constitute a waiver of any such rights.
10. Counterparts. This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same agreement and shall become effective when two or more
counterparts have been signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
11. Notices. Exhibit C of the Midstream Services Agreement is hereby amended to
replace the Shipper’s notice address with the attached Exhibit C.
12. Governing Law. This Agreement shall be governed by and construed and enforced in
accordance with the internal laws of the State of Kansas, without regard to the principles of
conflicts of laws thereof.
13. Entire Agreement. This Agreement embodies the entire agreement between the
parties hereto and there are no agreements, representations or warranties between the parties other
that those set forth or provided herein.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first
hereinabove written.
QUEST RESOURCE CORPORATION |
||||
By: | ||||
Name: | Xxxxx X. Xxxx | |||
Title: | Chief Executive Officer | |||
BLUESTEM PIPELINE, LLC | ||||||||
By: | Quest Midstream Partners, L.P., | |||||||
its sole member |
By: | Quest Midstream GP, LLC, | |||||
its general partner | ||||||
By: | ||||||
Name: | ||||||
Title: | ||||||
QUEST ENERGY PARTNERS, L.P. | ||||||||
By: | Quest Energy GP, LLC, | |||||||
its general partner |
By: | ||||||
Name: | ||||||
Title: | ||||||
EXHIBIT C
To The Midstream Services and Gas Dedication Agreement
Between Bluestem Pipeline, LLC and Quest Resource Corporation
Effective December 1, 2006
Between Bluestem Pipeline, LLC and Quest Resource Corporation
Effective December 1, 2006
Gatherer: | Shipper: | |
Federal Tax ID Number: 00-0000000
|
U.S. Federal Tax ID Number: 00-0000000 |
Notices:
0000 Xxxxx Xxx Xxx, Xxxxxxxx Xxxx, XX 00000
|
0000 Xxxxx Xxx Xxx, Xxxxxxxx Xxxx, XX 00000 | |
Attn: Xxxxxxx Xxxxxxxx
|
Attn: | |
Phone: 000-000-0000 Fax: 000-000 0000
|
Phone: 000-000-0000 Fax: 000-000 0000 |
Confirmations:
Same as above
|
same as above | |
Attn: Xxxxx Xxxxxxxx
|
Attn: [Xxxxx Xxxxxxxx] | |
Phone: 000-000-0000 Fax: 000-000-0000
|
Phone: 000-000-0000 Fax: 000-000-0000 |
Invoices and Payments:
Same as above
|
Same as above | |
Attn: Accounting
|
Attn: Accounting |
Wire Transfer or ACH Numbers (if applicable):
BANK: Chase Bank
|
BANK: Chase Bank | |
ABA: 000000000
|
ABA: 000000000 | |
ACCT: 630373728
|
ACCT: |