INDEMNITY AND CONTRIBUTION AGREEMENT
THIS INDEMNITY AND CONTRIBUTION AGREEMENT (the "Agreement") dated as of
April 28, 1997, by and between XXXXXX XXXXXX ENERGY PARTNERS, L.P., a Delaware
limited partnership (the "Partnership"), and FIRST UNION INVESTORS, INC., a
North Carolina corporation (the "Selling Unitholder")
W I T N E S S E T H :
WHEREAS, pursuant to a Unit Registration Rights Agreement dated as of
February 14, 1997 (the "Unit Registration Rights Agreement") among the
Partnership (then named Enron Liquids Pipeline, L.P.), the Selling Unitholder,
and Kinder Xxxxxx X.X., Inc. (then named Enron Liquids Pipeline Company)
("Seller"), the Partnership undertook to take certain actions to effect the
registration under the Securities Act of 1933 (the "Securities Act") of 429,000
Common Units of the Partnership (the "Units") purchased by the Selling
Unitholder from Seller, and to execute and deliver certain indemnity agreements
in accordance with Section 6.13(c) of the Amended and Restated Agreement of
Limited Partnership of the Partnership (the "Partnership Agreement"); and
WHEREAS, pursuant to the Unit Registration Rights Agreement, the
Partnership has on this date filed a Registration Statement under the Securities
Act with respect to the Units (which Registration Statement also covers certain
other Common Units that may be offered and sold by Seller) (such Registration
Statement, together with all amendments thereto, and including all of the
exhibits and schedules thereto and all information incorporated by reference
therein, being referred to herein as the "Registration Statement"; any
prospectus included therein and used prior to the effective date of such
Registration Statement (including all information incorporated therein by
reference) being referred to herein as a "Preliminary Prospectus"; and any
prospectus included therein at the time such Registration Statement becomes
effective, or as filed with respect thereto pursuant to Rule 424 under the
Securities Act after such effectiveness, and any amendment or supplement thereto
or summary prospectus with respect thereto (including all information
incorporated by reference in any of the foregoing), in each case if used during
the time the Registration Statement remains effective, being referred to herein
as a "Prospectus"; and any registration statement or similar document filed
under any state securities or Blue Sky laws to register or qualify the Units for
offering and sale in such jurisdiction or establish an exemption from such
registration or qualification being referred to herein as a "Blue Sky Filing");
and
WHEREAS, the parties hereto wish to provide herein for indemnity and
contribution as contemplated by the Unit Registration Rights Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
set forth herein, the parties do hereby agree as follows:
1. Indemnification. In addition to and not in limitation of any other
obligation of the Partnership under any other agreement to which it is or
becomes a party, the Partnership hereby agrees that it will, to the fullest
extent permitted by law, indemnify and
hold harmless the Selling Unitholder, its officers and directors and each
person who controls the Selling Unitholder (within the meaning of the Securities
Act), any agent thereof, and any person who acts as an underwriter with respect
to the offering and sale of the Units pursuant to the Registration Statement,
the officers and directors of any such agent or underwriter and each person who
controls any such agent or underwriter (within the meaning of the Securities
Act) (collectively, "Indemnified Persons") from and against any and all losses,
claims, demands, actions, causes of action, assessments, damages, liabilities
(joint or several), costs and expenses (including, without limitation, interest,
penalties and reasonable attorneys' fees and disbursements) resulting to,
imposed upon, or incurred by the Indemnified Persons, directly or indirectly,
under the Securities Act or otherwise, based upon or arising out of, or
resulting from, any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, any Preliminary Prospectus, any
Prospectus, or any Blue Sky Filing, or arising out of or based upon or resulting
from the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading
(collectively, "Covered Claims and Losses"). If any Indemnified Person is or
becomes obligated by law or contract or otherwise to provide indemnification or
contribution to another Indemnified Person with respect to any Covered Claims
and Losses, then, as between the Partnership and such Indemnified Persons, any
payments made by such first Indemnified Person to such second Indemnified Person
shall, to the extent such payments are so made, be deemed to be "Covered Claims
and Losses" of such first Indemnified Person. Notwithstanding the foregoing, the
Partnership shall not be liable to any Indemnified Person for Covered Claims and
Losses to the extent that any of such Covered Claims and Losses arise out of or
are based upon or result from an untrue statement or alleged untrue statement or
omission or alleged omission made in such Registration Statement, Preliminary
Prospectus, Prospectus or Blue Sky Filing in reliance upon and in conformity
with written information provided to the Partnership by or on behalf of such
Indemnified Person (or, in the case of an Indemnified Person who is a director
or officer of, or who controls, the Selling Unitholder, provided to the
Partnership by or on behalf of the Selling Unitholder) specifically for use in
the preparation thereof (it being understood that, as of the date hereof, the
only written information provided to the Partnership by or on behalf of the
Selling Unitholder specifically for use in the preparation thereof is the
information set forth in the Preliminary Prospectus under the captions "SELLING
UNITHOLDERS" and "PLAN OF DISTRIBUTION" and the information as to the plan of
distribution set forth in the first paragraph on the cover page of the
Preliminary Prospectus, except in each such case the information therein with
respect to Seller or the Common Units that may be offered and sold by Seller).
2. Contribution. If the indemnification provided for in Section 1 is
unavailable or insufficient to hold harmless an Indemnified Person as therein
provided, then the Partnership shall contribute to the amount paid or payable by
such Indemnified Person with respect to the Covered Claims and Losses otherwise
indemnifiable by the Partnership pursuant to Section 1 in such proportion as is
appropriate to reflect the relative fault of the Partnership, on the one hand,
and of such Indemnified Person, on the other hand, in
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connection with the statements or omissions that resulted in such Covered
Claims and Losses, as well as other equitable considerations. Relative fault
shall be determined by reference to, among other things, whether the untrue
statement or alleged untrue statement or the omission or alleged omission
relates to information provided by the Partnership or the Indemnified Person and
such parties' relative intent, knowledge, access to information and opportunity
to correct such untrue statement or omission. The Partnership and the Selling
Unitholder agree that it would not be just and equitable if contribution were
determined by any method of allocation that does not take into account the
equitable considerations referred to above.
3. Further Agreements. The parties shall execute and deliver such other
indemnity agreements as are required pursuant to Section 6.13(c) of the
Partnership Agreement and otherwise as may be reasonably required by any
underwriter in connection with the offering and sale of the Units, and nothing
in this Agreement is intended to impair the Selling Unitholder's right to
request any such additional agreements from the Partnership.
4. Miscellaneous.
(a) No party may assign its rights or delegate its duties hereunder without
the prior written consent of the other party, except that the Selling Unitholder
may assign its rights hereunder to any affiliate of such Selling Unitholder with
respect to any Units transferred to such affiliate prior to the public sale
thereof.
(b) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns, and shall
also inure to the benefit of the Indemnified Persons referred to herein.
(c) The parties have entered into this Agreement for the purposes herein
expressed, with the intention that this Agreement be given full effect to carry
out such purposes. Therefore, consistent with the effectuation of the purposes
hereof, the invalidity or unenforceability of any provision hereof or part
thereof shall not affect the validity of or enforceability of any other
provision hereof or any other part of such provision.
(d) The validity and construction of this Agreement shall be governed by
the substantive laws of the State of Delaware without regard to the conflict of
law rules of such jurisdiction, except to the extent that the federal laws of
the United States are applicable.
(e) This Agreement may be executed by the parties in multiple counterparts
and shall be effective as of the date set forth above when such parties hereto
shall have executed and delivered a counterpart hereof, whether or not the same
counterpart is executed and delivered by each party hereto.
* * * * *
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IN WITNESS WHEREOF, the Partnership and the Selling Unitholder have caused
this Agreement to be executed by duly authorized persons, as of the day and year
first above written.
XXXXXX XXXXXX ENERGY PARTNERS, L.P.,
By: KINDER XXXXXX X.X., INC.,
its General Partner
By:/s/ Xxx X. Xxxx
Title: President
FIRST UNION INVESTORS, INC.
By: /s/ Xxxxx X. Xxxxx
Title: Vice President
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