CONTRIBUTION AND DISTRIBUTION AGREEMENT
CONTRIBUTION AND DISTRIBUTION AGREEMENT dated as of August 26, 1997 among
FREEPORT-McMoRan RESOURCE PARTNERS, LIMITED PARTNERSHIP, a Delaware limited
partnership (together with its successors and permitted assigns, "FRP"),
FREEPORT-McMoRan INC., a Delaware corporation (together with its successors and
permitted assigns, "FTX") and FREEPORT SULPHUR COMPANY, a Delaware corporation
(together with its successors and permitted assigns, "COMPANY").
W I T N E S S E T H
WHEREAS, capitalized terms used in the Recitals shall have the meanings set
forth in Article I hereof, unless the context dictates otherwise;
WHEREAS, the Company is a wholly-owned subsidiary of FRP;
WHEREAS, FTX is the Administrative Managing General Partner and Special
General Partner of FRP, and FMRP Inc., a Delaware corporation and a wholly owned
subsidiary of FTX (together with its successors and permitted assigns, "FMRP"),
is the Managing General Partner and Special General Partner of FRP;
WHEREAS, FTX and FRP intend to contribute certain assets to the Company and
the Company intends to assume certain liabilities, subject to the terms and
conditions more particularly described herein (the "CONTRIBUTIONS");
WHEREAS, FRP intends to distribute (the "DISTRIBUTION") all of the
outstanding shares of Company Common Stock and Rights to the holders of FMRP
Units, Unit Equivalents and the Basic General Partnership Interest;
WHEREAS, the Board of Directors of FTX has approved an Agreement and Plan
of Merger between FTX and IMC Global Inc., a Delaware corporation ("IGL") dated
the date hereof (the "MERGER AGREEMENT") pursuant to which, and subject to the
terms and conditions thereof, FTX will merge with and into IGL (the "MERGER");
WHEREAS, in connection with the Merger and prior to the Contributions, IMC
Global Operations Inc, a Delaware corporation ("IMC OPERATIONS"), intends to
transfer and to confirm the prior transfer of certain assets to the Company and
the Company intends to assume certain liabilities, pursuant to an Assignment and
Assumption Agreement substantially in the form of EXHIBIT A hereto (the
"ASSIGNMENT AGREEMENT"); and
WHEREAS, the parties have determined that it is necessary and desirable to
set forth the principal transactions required to effect the Contributions and
the Distribution and to enter into other agreements that will govern certain
matters following the Distribution;
NOW, THEREFORE, in consideration of the mutual agreements and covenants
contained in this Agreement, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. DEFINITIONS. As used herein, the following terms, when
capitalized, shall have the following meanings, unless the context dictates
otherwise:
"Action" means any claim, suit, chose in action, arbitration, mediation,
inquiry, proceeding or investigation by or before any court, governmental or
other regulatory or administrative agency or commission or any other tribunal.
"Affiliate" means with respect to any Person, any Person that directly or
indirectly through one or more intermediaries, controls, is controlled by or is
under common control with such Person. As used in this definition, the term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of the Person, whether
through ownership of voting securities, by contract, as trustee or executor or
otherwise; provided that (i) immediately following the Effective Time, the
Company shall not be an Affiliate of IGL or FRP and (ii) the Company shall not
be deemed to be an Affiliate of IMC-Agrico Company.
"Agreement" means this Contribution and Distribution Agreement, including
all exhibits and schedules hereto.
"Applicable Law" means all applicable provisions of all (i) constitutions,
treaties, statutes, laws (including the common law), rules, regulations,
ordinances, codes or orders of any Governmental Authority, (ii) Consents by
Governmental Authorities and (iii) orders, decisions, injunctions, judgments,
awards and decrees of or agreements rendered by or entered into with any
Governmental Authority.
"Assignment Agreement" shall have the meaning set forth in the Recitals.
"Assumed Liabilities" shall have the meaning set forth in Section 3.03
hereof.
"Balance Sheet" shall have the meaning set forth in Section 3.01(a) hereof.
"Basic General Partnership Interest" shall have the meaning set forth in
the Partnership Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the United States Securities and Exchange Commission.
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"Company Certificate" means the Certificate of Incorporation of the
Company.
"Company Bylaws" means the Bylaws of the Company as adopted by the
Company's Board of Directors.
"Company Common Stock" means shares of common stock, par value $.01 per
share, of the Company.
"Company Indemnitees" shall have the meaning set forth in Section 5.01(a)
hereof.
"Company Rights Plan" means the rights agreement of the Company as adopted
by the Company's Board of Directors.
"Consent" means any consent, approval, authorization, waiver, permit,
grant, franchise, concession, agreement, license, exemption or order of,
registration, certificate, declaration, or filing with, or report or notice to,
any Person, including but not limited to any Governmental Authority that is
required as a precondition to the transfer of one or more of the Transferred
Assets or the performance of one or more actions identified herein.
"Contaminant" means any waste, pollutant, hazardous or toxic substance or
waste, petroleum, petroleum-based substance or waste, special waste, or any
constituent of any such substance or waste.
"Contributions" shall have the meaning set forth in the Recitals.
"Database" means all geological, geophysical or other similar information
including but not limited to, files, surveys, maps, studies, contracts, logs,
computer programs, seismic cross sections, computer tapes and other technical
data owned or licensed by or leased to FTX and/or FRP which are in existence on
the date hereof and which are used primarily in connection with, or which are
otherwise necessary or desirable to operate, the Transferred Businesses.
"Distribution" shall have the meaning set forth in the Recitals.
"Distribution Agent" means Xxxxx Xxxxxx Shareholder Services, L.L.C., as
agent of the holders of FMRP Units, Unit Equivalents and the Basic General
Partnership Interest.
"Distribution Date" means the date on which the Distribution is effected.
"Effective Time" shall mean the effective time of the Merger, as provided
in Section 1.2 of the Merger Agreement.
"Employee Benefits Agreement" means the agreement among FTX, FRP and
Company, in substantially the form of EXHIBIT B hereto.
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"Environmental Law" means all Applicable Law relating to or addressing the
environment, health or safety, including but not limited to OSHA and RCRA and
any state equivalent thereof or any successor statute.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Assets" shall have the meaning set forth in Section 3.02 hereof.
"Excluded Liabilities" shall have the meaning set forth in Section 3.04
hereof.
"Fertilizer Business" means the business conducted by IMC-Agrico Company.
"FM Services Agreement" means the Termination Agreement between FTX, FCX
and FM Services Company, a Delaware corporation, substantially in the form of
EXHIBIT C hereto, as such agreement may be amended from time to time.
"FMRP" shall have the meaning set forth in the Recitals.
"FMRP Unit" shall have the meaning set forth in the Partnership Agreement.
"Form 10" means the registration statement on Form 10 with respect to the
shares of Company Common Stock and Rights, to be filed with the Commission under
the Exchange Act, together with any amendments thereto.
"FRP Indemnitees" shall have the meaning set forth in Section 5.01(b).
"Governmental Authority" means any federal, state, county, municipal or
other government, department, commission, board, court, agency, authority, or
any other instrumentality of any of them, or any other organization exercising
legislative, executive or judicial authority over any of the foregoing.
"Hydrocarbons" means crude oil and/or condensate, natural gas, distillate,
natural gas liquids and all products recovered in the processing of natural gas
liquids, including, without limitation natural gasoline, iso-butane, normal
butane, propane and ethane (including such methane allowable in commercial
ethane).
"IGL" shall have the meaning set forth in the Recitals.
"IMC Operations" shall have the meaning set forth in the Recitals.
"Income Statement" shall have the meaning set forth in Section 3.01(a)
hereof.
"Indemnified Party" shall have the meaning set forth in Section 5.01(d)
hereof.
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"Indemnifying Party" shall have the meaning set forth in Section 5.01(d)
hereof.
"Indemnitee" shall mean any Company Indemnitee or any FRP Indemnitee, as
the case may be.
"Information Statement" means the information statement filed as part of
the Form 10 to be sent to the holders of FMRP Units, Unit Equivalents and the
Basic General Partnership Interest, in connection with the Distribution.
"Insurance Proceeds" means any monies (i) received by an insured from an
insurance carrier or (ii) paid by an insurance carrier on behalf of the insured,
in either case net of any applicable premium adjustments (including reserves),
retrospectively-rated premium adjustments, deductibles, retentions, or costs
paid by such insured.
"Intellectual Property" means any and all United States and foreign (a)
patents (including design patents, industrial designs and utility models) and
patent applications (including docketed patent disclosures awaiting filing,
reissues, divisions, continuations-in-part and extensions), patent disclosures
awaiting filing determination, inventions, and improvements thereto, (b)
trademarks, service marks, trade names, trade dress, logos, business and product
names, slogans, and registrations and applications for registration thereof,
together with the goodwill of the businesses attributable thereto, (c)
copyrights (including software) and registrations thereof, (d) inventions,
processes, designs, formulae, trade secrets, know-how, industrial models,
confidential and technical information, manufacturing, engineering and technical
drawings, product specifications and confidential business information, (e)
intellectual property rights similar to the foregoing, and (f) copies and
tangible embodiments thereof (in whatever form or medium, including electronic
media).
"Leased Real Property" means all interests (including offshore acreage)
leased pursuant to the Leases, together with all structures, facilities,
improvements, fixtures, systems, equipment, and items of real property owned or
leased by FRP or FTX that presently (or on the Distribution Date) are or will be
located on the real property or other acreage subject to the Leases, and all of
FRP's or FTX's right, title and interest in and to all easements, servitudes,
licenses, rights, rights-of-way, operating rights, franchises and appurtenances
relating to the foregoing.
"Leases" means the real property leases, subleases, licenses and occupancy
agreements set forth on Part 1 of Schedule 3.01 hereto pursuant to which FRP or
FTX is the lessee, sublessee, licensee, or occupant.
"Liabilities" means any and all claims, debts, costs, indebtedness,
liabilities and obligations, absolute or contingent, matured or not matured,
liquidated or unliquidated, accrued or unaccrued, known or unknown, whenever
arising, including all costs and expenses related thereto and including, without
limitation, those claims, debts, costs, indebtedness, liabilities and
obligations arising under any law, rule, regulation, Action, threatened Action,
order or consent decree of any governmental
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entity or any award of any arbitrator of any kind, and those arising under
any contract, commitments or undertaking.
"Lien" means any interest in property held by someone other than the owner
of the property, including a mortgage, pledge, hypothecation, claim, security
interest, pledge, encumbrance, lease, sublease, license, occupancy agreement,
adverse claim or interest, conditional sale, easement, servitude, covenant,
encroachment, burden, title defect, title retention agreement, voting trust
agreement, option, lien, right of first refusal, right of rescission, charge or
other restriction or limitation of any nature whatsoever.
"Losses" shall have the meaning set forth in Section 5.01(a) hereof.
"Merger" shall have the meaning set forth in the Recitals.
"Merger Agreement" shall have the meaning set forth in the Recitals.
"NYSE" means the New York Stock Exchange.
"Owned Real Property" means the real property identified on Part 1 of
Schedule 3.01 that is owned by FRP or FTX in fee simple, together with all other
structures, facilities, improvements, fixtures, systems, equipment, and items of
real property that presently (or on the Distribution Date) are or will be
located thereon or attached or appurtenant thereto and all easements,
servitudes, licenses, rights, rights-of-way, operating rights, franchises and
appurtenances relating to the foregoing.
"Partnership Agreement" means the Amended and Restated Agreement of Limited
Partnership of Freeport-McMoRan Resource Partners, Limited Partnership, dated
May 29, 1987 (amending and restating the Agreement of Limited Partnership
entered into as of April 17, 1986), as amended by amendments dated December 16,
1988, March 29, 1990, April 6, 1990, January 27, 1992 and October 14, 1992.
"Permit" means any foreign, federal, state, municipal and local permit,
license, registration, consent, order, administrative consent order,
certificate, approval or other authorization with respect to FRP or FTX
necessary for the ownership or use of any Transferred Asset or the conduct of
the Transferred Businesses as it is currently conducted or has been previously
conducted.
"Person" means any natural person, firm, partnership, limited liability
company, association, corporation, company, trust, business trust, Governmental
Authority or other entity.
"Prior Business" shall have the meaning set forth in Section 3.03(c)
hereof.
"Prior Business Real Property" shall have the meaning set forth in Section
3.03(e) hereof.
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"Real Property" shall mean the Owned Real Property and the Leased Real
Property.
"Record Date" means the date determined by FTX, in its capacity as the
Administrative Managing General Partner of FRP, as the record date for
determining the holders of FMRP Units, Unit Equivalents, and the Basic General
Partnership Interest who are entitled to receive the Distribution.
"Release" means any release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration of a Contaminant
into the indoor or outdoor environment or into or out of any Real Property,
including the movement of Contaminants through or in the air, soil, surface
water, groundwater or Real Property.
"Remedial Action " means actions required to (i) clean up, remove, treat
or in any other way address Contaminants in the indoor or outdoor environment;
(ii) prevent the Release or threatened Release or minimize the further Release
of Contaminants or (iii) investigate and determine if a remedial response is
needed and to design such a response and post-remedial investigation,
monitoring, operation and maintenance and care, in each case, to the extent
required by an Environmental Law.
"Rights" means the preferred stock purchase rights to be issued by the
Company pursuant to the Company Rights Plan.
"Securities Act" means the Securities Act of 1933, as amended.
"Stock Incentive Plan" means the stock incentive plan or plans as adopted
by the Company.
"Tax" means any federal, state, provincial, local, foreign or other income,
alternative minimum, accumulated earnings, personal holding company, franchise,
capital stock, net worth, capital, profits, windfall profits, gross receipts,
value added, sales, use, goods and services, excise, customs duties, transfer,
conveyance, mortgage, registration, stamp, documentary, recording, premium,
severance, environmental (including taxes under Section 59(A) of the Code), real
property, personal property, ad valorem, intangible, rent, occupancy, license,
occupational, employment, unemployment insurance, social security, disability,
workers' compensation, payroll, healthcare, withholding, estimated or similar
tax, duty or other governmental charge or assessment or deficiencies thereof,
including all interest and penalties thereon and additions thereto whether
disputed or not.
"Tax Cooperation Agreement" means the agreement among FTX, FRP and the
Company, in substantially the form of EXHIBIT D hereto.
"Transferred Assets" means the assets identified in Section 3.01(a) hereof,
to the extent that such assets do not constitute Excluded Assets.
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"Transferred Businesses" means, collectively: (i) the businesses and
operations of FRP, FTX and their respective Affiliates to the extent relating to
the exploration, production, development, processing, transportation, storage,
terminalling, sale, purchase or marketing of sulphur, in whatever form, and of
sulphuric acid, or the provision of other services in connection therewith,
including, without limitation, the operations conducted from the Real Property,
but expressly excluding the purchase and processing of sulphur by IMC-Agrico
Company; (ii) the businesses and operations of FRP, FTX and their respective
Affiliates to the extent relating to the exploration, production, development,
processing, transportation, sale, purchase or marketing of Hydrocarbons
produced from or allocable to the Real Property, or the provision of other
services in connection therewith; (iii) the businesses and operations of the
entities identified on Part 2 of Schedule 3.01 as being transferred to the
Company as part of the Transferred Assets; (iv) to the extent not already
included in the descriptions set forth in (i) through (iii) of this definition,
(A) all businesses and operations reflected on the Balance Sheet and Income
Statement; and (B) all businesses and operations located on the Real Property or
using or consuming any of the Transferred Assets.
"Unit Equivalent" shall have the meaning set forth in the Partnership
Agreement.
ARTICLE II
THE DISTRIBUTION
Section 2.01. COOPERATION PRIOR TO THE DISTRIBUTION. (a) As soon as
practicable after the execution of this Agreement, FRP and the Company shall
prepare and file with the Commission, the Form 10, which shall include the
Information Statement, setting forth appropriate disclosure concerning the
Company, the Distribution and any other appropriate matters required to be
stated therein. FRP shall use best reasonable efforts to cause the Form 10 to
become effective under the Exchange Act, and thereafter FRP shall mail the
Information Statement to holders of FMRP Units, Unit Equivalents and the Basic
General Partnership Interest as of the Record Date.
(b) FRP and the Company shall take all such action as may be
reasonably necessary or appropriate under the securities or blue sky laws of
states or other Governmental Authorities of the United States in connection with
the transactions contemplated by this Agreement.
(c) The Company shall prepare, file (not later than the date of
filing of the Form 10 with the Commission) and pursue an application to list the
Company Common Stock and associated Rights on the NYSE.
Section 2.02. FTX BOARD ACTION; CONDITIONS PRECEDENT TO THE DISTRIBUTION.
The Board of Directors of FTX shall, in its discretion, acting in its capacity
as the Administrative Managing General Partner of FRP, (a) establish the Record
Date and Distribution Date, and (b) establish any appropriate procedures in
connection with the Distribution. In no event shall the Distribution Date be
later than the Effective Time. In addition, in no event shall the Distribution
occur unless each of the following conditions shall have been satisfied or
waived by FRP and FTX:
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(i) The Company shall have been duly formed and shall be validly
existing; the Company's Board of Directors shall have been elected by FRP; the
Company Certificate and Company Bylaws shall be in effect; and the Company's
Board of Directors shall have adopted the Company Rights Plan and declared and
paid a dividend of 1 Right for each share of Company Common Stock outstanding;
(ii) the Form 10 shall have become effective under the Exchange Act;
(iii) the Company Common Stock and Rights associated therewith
shall have been approved for listing on the NYSE, subject to official notice of
issuance;
(iv) IMC Operations and FRP shall have executed the Assignment
Agreement;
(v) the Transferred Assets shall have been transferred to the
Company, and the Assumed Liabilities shall have been assumed by the Company, in
each case as contemplated by Article III hereof;
(vi) the FM Services Agreement, the Tax Cooperation Agreement and the
Employee Benefits Agreement shall have been duly and validly authorized,
executed and delivered by the respective parties thereto;
(vii) all conditions precedent to the Merger shall have occurred
or been waived by the party enjoying the benefit thereof;
(viii) the Company's Board of Directors shall have adopted, and FRP
as the sole shareholder of the Company shall have approved, the Stock Incentive
Plan and shall take all such actions as are necessary or desirable to cause all
outstanding options to purchase FTX Common Stock and any awards related to FTX
Common Stock to be converted into an adjusted option to purchase or award
relating to FTX Common Stock and a new option to purchase or award relating to
the Company Common Stock issued in accordance with the Stock Incentive Plan; and
(ix) to the extent required by contract or Applicable Law in
connection with the conveyance of the Transferred Assets, FRP shall have
obtained the Consents identified on Schedule 2.02 hereto.
Each of the parties hereto agrees to use its best reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with the other party in doing, all things necessary, proper
or advisable to satisfy and fulfill the foregoing conditions as soon as
reasonably practicable and to cause the Distribution to be effective.
Section 2.03. THE DISTRIBUTION. (a) On the Distribution Date, subject to
the conditions set forth in this Agreement, FRP shall, except as otherwise
provided in Section 2.04, cause the Distribution Agent to distribute to each
holder of FMRP Units, Unit Equivalents and the Basic
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General Partnership Interest on the Record Date (i) 1 share of Company Common
Stock and the associated Right for each 10 FMRP Units, (ii) 1 share of
Company Common Stock and the associated Right for each 10 Unit Equivalents,
and (iii) 1 share of Company Common Stock and the associated Right for each
10 units of Basic General Partnership Interest, so held.
(b) The Company shall provide all certificates for shares of Company
Common Stock that FRP shall require in order to effect the Distribution.
Section 2.04. SALE OF FRACTIONAL SHARES. Prior to the Distribution Date,
FRP shall appoint the Distribution Agent as agent for all holders on the Record
Date of FMRP Units, Unit Equivalents and the Basic General Partnership Interest
who would receive in the Distribution any fractional share of Company Common
Stock. The Distribution Agent shall aggregate all such fractional shares and
sell them in an orderly manner after the Distribution Date in the open market
and, after completion of such sales, distribute a prorated portion of the
proceeds from such sales, based upon the average gross selling price of all such
fractional shares, to each holder of FMRP Units, Unit Equivalents or Basic
General Partnership Interest who would otherwise have received a fractional
share. FTX shall reimburse the Distribution Agent for the costs and expenses
incurred in connection with the foregoing.
ARTICLE III
CONVEYANCE AND ASSUMPTION
Section 3.01. TRANSFER OF ASSETS.
(a) Upon the terms and subject to the conditions of this Agreement,
FRP and FTX shall take all such action as may be necessary or appropriate under
Applicable Law to assign, transfer and deliver, or cause to be assigned,
transferred and delivered, to the Company, on or prior to the Distribution Date,
but effective as of the Distribution Date, all right, title and interest of FRP,
FTX, or any of their respective Affiliates in and to all of the following
assets, to the extent that such assets exist on the Distribution Date and do not
constitute Excluded Assets, and except as set forth in Section 3.01(b) below
(collectively, but expressly excluding any Excluded Assets, the "TRANSFERRED
ASSETS"):
(i) All assets owned by FTX, FRP or any of their Affiliates that are
used primarily in connection with the Transferred Businesses, including all
(A) assets reflected on the June 30, 1997, unaudited consolidated balance
sheet of the Transferred Businesses attached as EXHIBIT E hereto (the
"BALANCE SHEET"), as well as those acquired or generated by the Transferred
Businesses or any Transferred Asset since the date of the Balance Sheet,
and (B) those assets that generate any income reflected on the unaudited
income statement of the Transferred Businesses for calender year 1996 and
for the six month period ended June 30, 1997 attached as EXHIBIT F (the
"INCOME STATEMENT") hereto less, in the case of (A) or (B), any assets
disposed of since the date of the respective statements; PROVIDED THAT the
parties
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hereto acknowledge that the actual values attributed to the assets included
in the Balance Sheet and Income Statement may change prior to the Effective
Time.
(ii) All right, title and interest of FRP, FTX or any of their
Affiliates in and to any and all of the assets listed on Schedule 3.01
hereto;
(iii) All right, title and interest of FRP, FTX or any of their
Affiliates in and to any and all of the assets physically located on any of
the Real Property;
(iv) All books, records and information of FTX, FRP and their
Affiliates recorded on any form of media whether owned, leased or licensed
by FTX, FRP or an Affiliate thereof, including magnetic disk, computer
drives or microfiche, to the extent the same primarily relate to or are
used primarily by or primarily in connection with the Transferred
Businesses or any Transferred Asset; all advertising materials, catalogs,
price lists, correspondence, mailing lists, lists of customers,
distribution lists, photographs, production data, sales and promotional
materials and records, purchasing materials and records, personnel records,
manufacturing and quality control records and procedures, blueprints,
specifications, drawings, schematics, research and development files,
records, data and laboratory books, Intellectual Property filings or
registrations, media materials and plates, accounting records, sales order
files, litigation files, logs, seismic and geophysical information,
geological and chemical data and information, reserve studies and
evaluations, fluid samples, well cores, title abstracts and opinions,
production data and reports, well testing data and reports, and maps, to
the extent that same primarily relate to or are used primarily by or
primarily in connection with the Transferred Businesses or any Transferred
Asset.
(v) Cash in amount of $2,000,000;
(vi) All credits, prepaid expenses, deferred charges, advance
payments, security deposits and prepaid items owned by, accrued in favor of
or held by FRP, FTX or any Affiliate thereof to the extent relating
primarily to the Transferred Businesses or any Transferred Asset.
(vii) All notes, accounts receivable, rights to payment or other
evidence of indebtedness generated by FRP and/or FTX primarily in
connection with the Transferred Businesses or any Transferred Asset; all
cash and cash equivalents paid in respect of any such notes, accounts
receivable, rights to payment or other indebtedness; and all Liens, letters
of credit, guarantees or bonds to secure the payment of all such amounts.
(viii) All of the right, title and interest of FRP, FTX or any of
their Affiliates in and to all contracts and agreements between FRP, FTX
and/or any of their Affiliates, on the one hand and any third party to the
extent made by or for the primary benefit of the Transferred Businesses or
any Transferred Asset.
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(ix) All asserted and unasserted Actions now owned by FRP and/or FTX
that are related primarily to or arise primarily out of the Transferred
Businesses or any of the Transferred Assets, including any claim for
royalty refunds or rebates from any land owner, including the United
States, and any claim for balancing of Hydrocarbons.
(x) All Consents and Permits held by FRP, FTX or any of their
Affiliates for the primary benefit of the Transferred Businesses or any
Transferred Asset.
(xi) All machinery, equipment, furniture, furnishings, automobiles,
trucks, vehicles, vessels, boats, aircraft, tools, dies, molds, xxxxx,
casing, tubing, pumping units, engines, platforms, derricks, separators,
compressors, flow lines, tanks, pipelines, chemicals, power generation and
transmission equipment, communication systems, meters, motors, parts and
similar property (including, but not limited to, any of the foregoing
purchased subject to any conditional sales or title retention agreement in
favor of any other Person or subject to any financed lease in favor of any
other Person) to the extent used primarily in connection with the
Transferred Businesses or any Transferred Asset.
(xii) All servitudes, easements, rights of way, water rights, grazing
leases, operating rights, exploration rights, sharing agreements, balancing
agreements, pooling or unitization agreements, farmout or farmin
agreements, unit designation and pooling orders or other rights or
agreements which bear primarily upon or are for the primary benefit of the
Transferred Businesses or any Transferred Asset.
(xiii) All sulphur, Hydrocarbons or other minerals to the extent
produced from or are allocable to the interest of FTX, FRP or any of their
Affiliates in and to any of the Leased Real Property.
(xiv) All Intellectual Property owned or licensed by FRP, FTX or any
of their Affiliates and all rights thereunder or in respect thereof to the
extent relating primarily to or used primarily or held primarily for use in
connection with the Transferred Businesses or any Transferred Asset,
including, but not limited to, rights to xxx for and remedies against past,
present and future infringements thereof, and rights of protection of
interests therein under the laws of any jurisdiction worldwide;
(xv) All Owned Real Property and Leases and all licenses, permits,
approvals and qualifications relating to any Real Property issued to FRP,
FTX or any of their Affiliates by any Governmental Authority;
(xvi) To the extent not otherwise described above, the Database, to
the extent permitted by contractual arrangements and agreements relating to
the Database and applicable law;
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(xvii) To the extent not otherwise described above, the assets
acquired, or intended to be acquired, by FRP from Pennzoil Company or its
Affiliates pursuant to the Asset Purchase Agreement dated as of October 22,
1994;
(xviii) To the extent not otherwise described above, the assets
acquired or intended to be acquired by FRP pursuant to the Assignment
Agreement, or, at FRP's discretion, the right to acquire such assets;
(xix) Any amounts reserved by FTX prior to the Distribution Date
in any self-insured accrual accounts to the extent relating to the self-
insured portion or deductible of any Assumed Liabilities; and
(xx) Any payments made to or on behalf of FTX or any Actions in
favor of FTX under any insurance policies retained by FTX to the extent
that the same relate to any Assumed Liabilities; provided that the past and
present insurance policies themselves shall be Excluded Assets.
(xxi) Any goodwill associated with the Transferred Businesses or
Transferred Assets.
(xxii) Any assets intended to be transferred to the Company
pursuant to the Employee Benefits Agreement.
The parties acknowledge and agree that the right, title and interest of FRP, FTX
and their Affiliates in and to the Excluded Assets are to be retained by FRP,
FTX or such Affiliate, as the case may be, and are not being transferred to the
Company pursuant to this Agreement or otherwise.
(b) In the event that FTX or FRP, or any other relevant Person,
shall be unable to transfer any of the Transferred Assets to the Company prior
to the Distribution Date due to the failure of FTX, FRP or any other Person to
obtain any necessary Consents, FTX, FRP or such other Person, as appropriate:
(i) shall continue to seek the necessary Consents, in accordance with Section
3.05(b) hereof; (ii) shall hold such Transferred Assets for the benefit of the
Company and cooperate with the Company in any lawful and economically feasible
arrangement to insure that the Company shall receive the benefits thereof, (iii)
shall hold or cause to be held for the account of the Company all accounts
receivable or accounts payable related to the Company's interest in any such
Transferred Assets accrued as, and accruing after, the Distribution Date, (iv)
shall make available to the Company all information relating to such Transferred
Assets to the extent making such information available is permitted by
Applicable Law and the contractual arrangements relating to such Transferred
Assets, (v) shall not, and shall cause all Affiliates not to, assign, transfer,
otherwise dispose of or xxxxx x Xxxx upon any such Transferred Assets to any
Person other than the Company, and (vi) shall upon obtaining the necessary
Consents relating to such Transferred Assets, promptly take such action, and
cause all other relevant Persons to promptly take, such action as may be
necessary to complete the transfer to the Company of such Transferred Assets,
including without
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limitation, all accrued accounts payable and accrued accounts receivable
related to such Transferred Assets. Any transfer of a Transferred Asset
after the Distribution Date shall be effective as of the Distribution Date.
It is agreed and understood that no party shall be liable in any manner to
any other party for any failure of any of the transfers contemplated by this
Article III to be consummated prior to the Distribution Date. Nothing in
this Article III shall be deemed to require the transfer of any Transferred
Assets which by their terms or operation of law cannot be transferred.
Section 3.02 EXCLUDED ASSETS. (a) Notwithstanding anything contained in
this Agreement or in any conveyance document to the contrary, the following
assets (collectively, the "EXCLUDED ASSETS") are not Transferred Assets and
shall not be transferred to Company hereunder:
(a) Any and all present and past insurance policies under the
FTX and FM Services Insurance Program, provided however, that any payments
to or on behalf of FTX under such policies to the extent that the same
relate to any Assumed Liabilities shall be a Transferred Asset;
(b) Any direct or indirect interest of FRP, FTX or any Affiliate
in or to (i) IMC-Agrico Company, (ii) FMRP, (iii) Agrico, Limited
Partnership or (iv) IMC-Agrico MP, Inc.; and
(c) Any assets used or consumed primarily in connection with or
otherwise primarily related to the Fertilizer Business other than sulphur.
Section 3.03. ASSUMPTION OF ASSUMED LIABILITIES. Subject to the terms and
conditions set forth in this Agreement, the Company shall assume and agree to
pay, honor and discharge when due, and take all action necessary or appropriate
under Applicable Law to assume, effective on or prior to the Distribution Date,
all Liabilities arising primarily from or primarily in connection with the
ownership, acquisition, conduct or operation (past, present or future) of the
Transferred Businesses (or any businesses, assets or operations managed or
operated by FTX or FRP or any past or present Affiliate thereof that have been
sold, liquidated, merged or otherwise disposed of or discontinued prior to the
Distribution Date to the extent that such businesses, assets or operations would
have been part of the "Transferred Businesses" had they been owned by FTX or FRP
on the Distribution Date (such businesses, assets or operations being herein
referred to as the "Prior Businesses")) or any Transferred Assets or relating
primarily to the ownership or use of the Transferred Assets, whether arising
before, on or after the Distribution Date and whether related to the current,
past or future operations of the Transferred Businesses, other than Excluded
Liabilities (collectively, the "ASSUMED LIABILITIES"). Without limitation of the
foregoing, Assumed Liabilities include, to the extent that they do not include
any Excluded Liabilities:
(a) Any and all Liabilities reflected on the Balance Sheet or
incurred after the date of the Balance Sheet in connection with the
Transferred Businesses or any Transferred Asset other than Excluded
Liabilities;
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(b) Liabilities in respect of present or former FTX or FRP
employees, to the extent specifically assumed by the Company pursuant to
the Employee Benefits Agreement;
(c) Any and all Liabilities primarily arising out of the
contracts and agreements described in Section 3.01(a)(viii) above;
(d) All Liabilities primarily related to, primarily associated
with or arising out of (i) the occupancy, operation, use or control of any
of the Real Property or any other real property occupied, operated, used or
controlled by the Prior Businesses (the "Prior Business Real Property"),
(ii) the operations of the Transferred Businesses or the Prior Businesses
(or in each case, any predecessor thereto, but in every such case, only
with respect to that portion of such predecessors' businesses that now
constitute the Transferred Businesses or previously constituted the Prior
Businesses), in each case incurred under or imposed by any Environmental
Law (including without limitation any Release or threatened Release of any
Contaminant on, in, at, to, beneath or from the Real Property or any Prior
Business Real Property, including, without limitation, all facilities,
improvements, structures and equipment thereon, surface water thereon or
adjacent thereto and soil or groundwater thereunder or any conditions
whatsoever on, in, at, under or in the vicinity of such real property),
(iii) the generation, handling transportation, storage, discharge or
disposal of any Contaminant primarily in connection with the Transferred
Businesses or the Prior Businesses, (iv) any Remedial Action required under
any Environmental Law primarily in connection with the Transferred
Businesses or the Prior Businesses; or (v) any violation of any
Environmental Law primarily in connection with the operations of the
Transferred Businesses or the Prior Businesses; and
(e) Any Liabilities arising out of or related to litigation to
the extent related to the current, past or future operations of the
Transferred Businesses.
Section 3.04 EXCLUDED LIABILITIES. Notwithstanding any provision of this
Agreement or any conveyance or assumption agreement to the contrary, the Company
shall not assume any of the following Liabilities (collectively, the "EXCLUDED
LIABILITIES"):
(a) Any Liabilities, obligations or commitments of FRP, FTX or
any other Person relating primarily to or arising primarily out of the
Fertilizer Business or any business other than the Transferred Businesses
or the Prior Businesses;
(b) Any and all Taxes relating to or arising out of the business
operations or activities of FRP, FTX or any of their Affiliates accruing,
or with respect to any event or time period occurring, at or prior to the
Distribution Date;
(c) Any and all Liabilities relating to, arising out of or in
connection with, any businesses, assets or operations managed or operated
by FTX or FRP have been sold,
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liquidated, merged or otherwise disposed of or discontinued prior to the
Distribution Date, other than the Transferred Businesses or Prior
Businesses;
(d) Any and all Liabilities relating to the Excluded Assets;
(e) Any and all Liabilities for money borrowed by FTX, FRP or
any of their Affiliates;
(f) Any and all Liabilities for which the Company is relieved of
liability under the Employee Benefits Agreement;
(g) All Liabilities related to, associated with or arising out
of (i) the occupancy, operation, use or control of any Real Property other
than the Real Property or the Prior Business Real Property, (ii) the
operations of the businesses and operations of FTX or FRP or any of their
Affiliates other than the Transferred Businesses or the Prior Businesses
(or in each case, any predecessor thereto), in each case incurred under or
imposed by any Environmental Law (including without limitation any Release
or threatened Release of any Contaminant on, in, at, to, beneath or from
any real estate other than the Real Property or the Prior Business Real
Property, including, without limitation, all facilities, improvements,
structures and equipment thereon, surface water thereon or adjacent thereto
and soil or groundwater thereunder or any conditions whatsoever on, in, at,
under or in the vicinity of such real property), (iii) the generation,
handling transportation, storage, discharge or disposal of any Contaminant
relating to any business or operation of FTX, FRP or any of their
Affiliates other than the Transferred Businesses or the Prior Businesses;
(iv) any Remedial Action required under any Environmental Law relating to
any business or operation of FTX, FRP or any of their Affiliates other than
the Transferred Businesses or the Prior Businesses; or (v) any violation of
any Environmental Law in connection with the operations of the business or
operations of FTX, FRP or and of their Affiliates other than the
Transferred Businesses or the Prior Businesses; or
(h) Any Liabilities arising out of or related to litigation to
the extent related to the current, past or future operations of the
business or operations of FTX, FRP or any of their Affiliates other than
the Transferred Businesses or the Prior Businesses.
(i) Any amounts for which checks or other drafts have been
drawn, in the ordinary course of business but which have not yet been paid
by the financial institution upon which they are drawn, to the extent that
such amounts constitute Liabilities.
Section 3.05. FURTHER ASSURANCES AND CONSENTS. (a) The transfer of the
Transferred Assets and the assumption of the Assumed Liabilities contemplated
herein shall be further evidenced by the execution and delivery by FRP, FTX, the
Company and any other relevant Person of such acts of transfer, conveyance and
assumption as may be reasonably requested by any party. Each of the parties
hereto will execute and deliver, and cause all other relevant Persons to execute
and deliver,
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such further instruments of conveyance, assumption and assignment and will
take such other actions (including, without limitation, (i) any changes or
amendments to or redelivery of such instruments of conveyance, assumption and
assignment that may be necessary to vest in the Company title to or other
applicable rights in the Transferred Assets and (ii) the delivery of
originals of stock certificates, motor vehicle titles and other similar
documents of title) as any other party may reasonably request in order to
effectuate the purposes of this Agreement.
(b) Each of the parties hereto shall use its reasonable efforts
to take all actions necessary to consummate the transactions contemplated by
this Agreement, including obtaining any Consents before or after the
Distribution Date, until such time as such Consent has been obtained. Any and
all out-of-pocket expenses and costs of seeking to obtain or of obtaining any
such Consent whether before or after the Distribution Date shall be borne by FTX
(subject to the terms of Section 8.11 hereof).
Section 3.06. "AS-IS, WHERE-IS." Each of the parties hereto understands
and agrees that no party hereto is, in this Agreement or in any other agreement
or document contemplated by this Agreement or otherwise, representing or
warranting in any way (a) as to the value or freedom from encumbrance of, or any
other matter concerning, any of the Transferred Assets or (b) as to the legal
sufficiency to convey title to any Transferred Asset, it being understood that
except as otherwise set forth in this Agreement or in any ancillary transfer
document, the Transferred Assets are being conveyed "As-is, Where-is," except
for rights or actions in warranty against predecessors in title (other than FRP,
FTX or any prior or current Affiliates thereof). It is understood and agreed
that except for the obligations of FTX, FRP and other Affiliates under Section
3.01(b) and 3.05(b), the Company shall bear the economic and legal risk that any
conveyance of the Transferred Assets shall prove to be insufficient or that the
Company's title to any such assets shall be other than good and marketable and
free from encumbrances. Similarly, each party hereto understands and agrees
that no party hereto is, in this Agreement or in any other agreement or document
contemplated by this Agreement or otherwise, representing or warranting in any
way that the obtaining of any Consents or approvals or the making of any filings
or applications contemplated by this Agreement will satisfy the provisions of
any or all applicable agreements or the requirements of any or all applicable
laws or judgments, it being agreed and understood that except for the obligation
of FTX, FRP and their Affiliates under Section 3.01(b) and 3.05(b) the Company
shall bear the economic and legal risk that any necessary consents or approvals
are not obtained or that any requirements of law or judgments are not complied
with.
Section 3.07. USE OF NAME "FREEPORT SULPHUR COMPANY". FTX and FRP consent
to the use by the Company of the name "Freeport Sulphur Company".
Section 3.08. RIGHT TO AUDIT. FTX and its successor shall have the right
to audit all amounts in respect of Section 3.01(a)(vi) and (vii) to insure that
such amounts are properly allocable to the Transferred Businesses or Transferred
Assets by the giving of written notice to the Company within 30 days of the
Distribution Date.
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Section 3.09. ADMINISTRATION OF INSURANCE POLICIES. FTX, FRP and the
Company agree to cooperate with each other with respect to the processing of any
claims that are covered by any insurance policy in existence prior to the
Distribution Date. The parties agree to execute an agreement pursuant to which
FM Services will administer insurance claims on behalf of FTX, FRP, the Company,
certain other Persons that are also beneficiaries of insurance policies covering
periods prior to the Effective Time and their respective Affiliates. Among
other things, this agreement will provide that (a) FTX and FM Services will
continue to own those insurance policies that each of FTX and FM Services owns
at the Effective Time; (b) FM Services will administer all claims made (whether
before or after the Effective Time) under any policies owned by FTX and FM
Services at the Effective Time subject to the payment by all such beneficiaries
of the reasonable costs of FM Services to handle such matters with such
administration activities being subject to the direction of the respective
beneficiaries and their respective successors and/or assigns in accordance with
criteria typical to and customary with third party administration relationships
common in the industry; (c) FTX will transfer to FM Services or the appropriate
Person any accruals for the self-insured portion or deductible relating to any
claims or threatened claims against such Person other than FTX or FRP covered by
one or more insurance policies owned by FTX, as funds are required to meet those
obligations; and (d) the FM Services insurance policies under which FTX is a
beneficiary shall be supplemented with the following endorsement or an
endorsement that is otherwise reasonably acceptable to IMC Global Inc. and the
parties hereto: "In consideration of premiums paid, it is understood and agreed
that IMC Global Inc. is an Additional Named Insured under this policy as their
interests may appear with respect to all operations of FTX which have been
acquired by IMC Global Inc. as of (date of merger)" for all losses covered by
the policy and occurring prior to the Effective Time of the merger.
Section 3.10. OTHER ACTIONS OF THE COMPANY. In addition to the specific
actions required to be taken by virtue of this Agreement, the Company agrees to
take all such lawful action with respect to the Company Common Stock as may be
necessary or appropriate in order to comply with legal requirements applicable
to the Distribution, the Merger or any of the other transactions contemplated by
this Agreement.
Section 3.11. POST-CLOSING OBLIGATIONS.
(a) In the event that any party to this Agreement (the "Paying
Party") makes any payment in respect of any obligation for which any other
Person (the "Obligated Party") is obligated pursuant to this Agreement or
otherwise, the Obligated Party shall reimburse the Paying Party within 30 days
of receiving a written request from the Paying Party containing reasonable
evidence that the Paying Party has made such payment. To the extent that any
pay period for any Transferred Employees (as such term is defined in the
Employee Benefits Agreement) spans a period of time which includes days both
before and after the Effective Time, the obligation of FTX and the Company for
such amounts shall be prorated, with FTX being obligated to pay an amount equal
to the total employee pay check for such pay period (including all withholdings)
times a fraction the numerator of which is the number of days in the pay period
prior to the date of the Effective Time and the denominator of which is the
total number of days in the pay period, and the Company being
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obligated to pay an amount equal to the total pay check for such pay period
(including all withholdings) times a fraction the numerator of which is the
number of days during the pay period on or after the Effective Time and the
denominator of which is the total number of days in the pay period. The
Company shall make the payment to the Transferred Employees for such pay
period and FTX shall reimburse the Company for its pro rata portion thereof
in accordance with the procedures set forth in the immediately preceding
sentence.
ARTICLE IV
EMPLOYEES, EMPLOYEE BENEFIT PLANS AND TAXES
Section 4.01. TERMINATION OF EMPLOYMENT; EMPLOYEES BENEFITS AGREEMENT.
FTX, FRP and Company agree to execute and be bound by the Employee Benefits
Agreement. Immediately prior to the Effective Time, FTX and FRP shall terminate
any of their remaining employees who are actively at work at the Effective Time
that have not been transferred to the Company or have not previously left the
employ of FTX. FTX and FRP acknowledge that the Company intends to offer
employment to many of the employees currently employed by FTX and FRP.
Section 4.02. WORK RELATED CLAIMS. From and after the Distribution Date,
FTX and FRP shall remain solely responsible for any and all Liabilities to or in
respect of any employee, excluding any Transferred Employee (as defined in the
Employee Benefits Agreement), relating to or arising in connection with any and
all claims under applicable workmen's compensation laws, the Xxxxx Act, 46
U.S.C. Section 688, the Xxxxxxxxx and Harbor Workers' Compensation Act, 33
U.S.C. Section 901, ET SEQ. or under similar laws, or arising in connection with
any occupational injury or disease, in each case occurring or existing on or
prior to the Distribution Date. FTX and FRP will comply with and shall be
responsible for all Liabilities incurred in connection with noncompliance with
the Worker Adjustment and Retraining Notification Act of 1989, 29 U.S.C. Section
2101 ET SEQ., as amended with respect to the respective employees of each such
company.
Section 4.03. EMPLOYMENT TAXES. (a) FTX and Company will (i) treat
Company as a "successor employer" and FTX as a "predecessor" within the meaning
of Sections 3121(a)(1) and 3306(b)(1) of the Code, with respect to transferred
employees who are employed by the Company for purposes of Taxes imposed under
the United States Federal Unemployment Tax Act (FICA) or the United States
Federal Insurance Contribution Act (FUTA) and (ii) cooperate with each other to
avoid, to the extent possible, the filing of more than one Internal Revenue
Service form W-2 with respect to each such transferred employee for the calendar
year within which the Distribution Date occurs.
ARTICLE V
INDEMNIFICATION
Section 5.01 (a) BY FTX AND FRP. FTX and FRP jointly and severally
covenant and agree (except in the case of subsection (vii) of this Section
4.2(a), in which case FTX individually covenants and agrees) to defend,
indemnify and hold harmless the Company, its officers, directors,
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employees, agents, advisors, representatives, contractors, subcontractors,
and those entities that are Affiliates of the Company immediately following
the Effective Time and each of the heirs, executors, successors, and assigns
of any of the foregoing (collectively the "COMPANY INDEMNITEES"), from and
against, and pay or reimburse the Company Indemnitees for, any and all
claims, liabilities, obligations, losses, fines, costs, royalties, penalties,
proceedings, deficiencies, or damages (whether absolute or accrued,
conditional or otherwise, and whether or not resulting from third party
claims), including out-of-pocket expenses and reasonable attorneys' and
accountants' fees incurred in the investigation or defense of any of the same
or asserting any of their respective rights hereunder (collectively
"LOSSES"), to the extent resulting from or arising out of: (i) any failure
of FTX, FRP or any of their Affiliates to perform any covenant or agreement
hereunder or fulfill any other obligation in respect hereof; (ii) any
Excluded Liabilities; (iii) any Excluded Assets; (iv) any and all Taxes of
FTX, FRP and/or their respective Affiliates immediately following the
Effective Time relating to or arising out of the Transferred Businesses or
any Transferred Asset accruing, or with respect to any event or time period
occurring, at or prior to the Distribution Date and which FTX or FRP has
assumed responsibility pursuant to the provisions of this Agreement; (v) any
and all Liabilities in respect of employees of FTX, FRP or any of their
Affiliates prior to or as of the Distribution Date, except to the extent
expressly assumed by the Company pursuant to the Employee Benefits Agreement;
(vi) any failure of FTX, FRP or any of their Affiliates to comply with
applicable bulk sales laws (in consideration of which indemnification
obligation the Company hereby waives compliance by FRP, FTX and their
Affiliates with applicable bulk sales laws); or (vii) any breach of any
warranty or inaccuracy of any representation of FTX or FRP contained herein,
except, to the extent such Losses result from or arise out of the Assumed
Liabilities or constitute Losses for which the Company is required to
indemnify the FRP Indemnitees under Section 5.01(b).
(b) BY COMPANY. The Company covenants and agrees to defend, indemnify,
and hold harmless FRP and FTX and their respective officers, directors,
employees, agents, advisors, representatives, contractors, subcontractors and
those entities that are Affiliates of FRP and FTX immediately following the
Effective Time and each of the heirs, executors, successors, and assigns of any
of the foregoing (collectively, the "FRP INDEMNITEES") from and against any and
all Losses to the extent resulting from or arising out of: (i) any failure of
the Company to perform any covenant or agreement hereunder or fulfill any other
obligation in respect hereof; (ii) any Assumed Liabilities or Transferred
Assets; (iii) any and all Taxes relating to or arising out of the Transferred
Businesses or any Transferred Asset accruing, or with respect to any event or
time period occurring, subsequent to the Distribution Date or in respect of
which the Company has assumed responsibility pursuant to the provisions of this
Agreement; (iv) any Liabilities in respect of employees of FTX, FRP or their
Affiliates to the extent expressly assumed by the Company pursuant to the
Employee Benefits Agreement; except, to the extent such Losses result from or
arise out of the Excluded Liabilities or constitute Losses for which FRP and/or
FTX are required to indemnify Company Indemnitees under Section 5.01(a); or (v)
any breach of any warranty or inaccuracy of any representation of the Company
contained herein.
(c) ADJUSTMENTS TO INDEMNIFICATION PAYMENTS. Any payment made by FRP
and/or FTX to the Company Indemnitees, on the
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one hand, or by the Company to the FRP Indemnitees, on the other hand,
pursuant to this Article V in respect of any claim shall be net of any
insurance proceeds received by the Indemnified Party in respect of such
claim. The Indemnified Party shall use its reasonable efforts to pursue
insurance claims relating to any claim for which it is seeking
indemnification pursuant to this Section 5.01; PROVIDED that the Indemnified
Party shall not be obligated to pursue an insurance claim if the Indemnified
Party in its reasonable judgment believes the cost of pursing such an
insurance claim exceed the value of the claim for which the Indemnified Party
is seeking indemnification. If any Indemnitee shall have received the payment
required by this Agreement from an Indemnifying Party in respect of an
indemnifiable Loss and shall subsequently receive insurance proceeds, then
such Indemnitee shall pay to such Indemnifying Party a sum equal to the
amount of such insurance proceeds.
(d) INDEMNIFICATION PROCEDURES. In the case of any claim for
indemnification pursuant to this Agreement by a party entitled to
indemnification under this Agreement (the "INDEMNIFIED PARTY"), notice shall be
given by the Indemnified Party to the party required to provide indemnification
(the "INDEMNIFYING PARTY") promptly after such Indemnified Party has actual
knowledge of any claim as to which indemnity may be sought, and the Indemnified
Party shall permit the Indemnifying Party (at the expense of such Indemnifying
Party) to assume the defense of any claim or litigation resulting therefrom,
PROVIDED that (i) the Indemnified Party may participate in such defense at such
Indemnified Party's expense, and (ii) the omission by any Indemnified Party to
give notice as provided herein shall not relieve the Indemnifying Party of its
indemnification obligations under this Agreement except to the extent that such
omission results in a failure of actual notice to the Indemnifying Party and
such Indemnifying Party is materially damaged as a result of such failure to
give notice. Except with the prior written consent of the Indemnified Party, no
Indemnifying Party, in the defense of any such claim or litigation, shall
consent to the entry of any judgment or enter into any settlement that provides
for injunctive or other non-monetary relief affecting the Indemnified Party
where it does not include as an unconditional term thereof the giving by each
claimant or plaintiff to such Indemnified Party of a release from all Liability
with respect to such claim or litigation. Unless an Indemnifying Party elects
not to assume the defense of or to seek to settle or compromise a third party
claim, such Indemnifying Party shall not be liable to such Indemnitee under this
Article V for any legal or other expenses subsequently incurred by such
Indemnitee in connection with the defense thereof; and in the event that the
Indemnifying Party does not accept the defense of any matter as above provided,
the Indemnified Party shall have the full right to defend against any such claim
or demand and shall be entitled to settle or agree to pay in full such claim or
demand. In any event, the Indemnifying Party and the Indemnified Party shall
cooperate in the defense of any claim or litigation subject to this Section 5.01
and the records of each shall be available to the other with respect to such
defense. Upon written demand of an Indemnitee, an Indemnifying Party shall
reimburse such Indemnitee for all direct, out of pocket Losses reasonably
incurred by it in connection with investigating or defending any third party
claim at the request of the Indemnifying Party in advance of its final
disposition; PROVIDED, that such reimbursement need be made only upon delivery
to the Indemnifying Party of an undertaking by such Indemnitee to repay all
amounts so reimbursed or advanced if it shall ultimately be determined that such
Indemnitee is not entitled to indemnification under this Article V or otherwise.
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(e) All claims for indemnification under this Article V shall survive
indefinitely after the Effective Time.
ARTICLE VI
INFORMATION
Section 6.01. ACCESS TO INFORMATION. From and after the date hereof, each
party shall afford each other party and its accountants, counsel and other
designated representatives reasonable access (including using reasonable efforts
to give access to persons or firms possessing information) and duplicating
rights during normal business hours to all records, books, contracts,
instruments, computer data and other data and information in such party's
possession relating to the business and affairs of such other party (other than
data and information subject to any attorney/client or other privilege or
otherwise required to be kept confidential pursuant to binding agreements),
insofar as such access is reasonably required by such other party including,
without limitation, for audit, accounting and litigation purposes, as well as
for purposes of fulfilling disclosure and reporting obligations.
Section 6.02. LITIGATION COOPERATION. Each party shall use reasonable
efforts to make available to each other party, upon written request, the
officers, directors, employees and agents of such parties and those entities
that are Affiliates immediately following the Effective Time as witnesses to the
extent that such persons may reasonably be required in connection with any
Action arising out of the business of the Company and its predecessors in which
the requesting party may from time to time be involved.
Section 6.03. REIMBURSEMENT. Each party providing information or
witnesses under Sections 6.01 or 6.02 to any other party shall be entitled to
receive from the recipient, upon the presentation of invoices therefor, payment
for all reasonable, direct, out-of-pocket costs and expenses as may be
reasonably incurred in providing such information or witnesses.
Section 6.04. RETENTION OF RECORDS. Except as otherwise required by law
or agreed to in writing, each party shall preserve and retain all information
relating to each other party's business throughout the term of the and for a
period of seven (7) years thereafter.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
Section 7.01. REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company
represents and warrants to FRP and FTX as follows:
(i) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation and has full corporate power and authority to enter into this
Agreement and perform its obligations hereunder and to own or lease its
properties and conduct its business as currently owned,
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leased or conducted or as proposed to be owned, leased or conducted by
reason of the transactions contemplated by this Agreement.
(ii) This Agreement, the Employee Benefits Agreement and the Tax
Cooperation Agreement have been duly authorized by the Company and, upon
the due execution and delivery hereof and thereof by the parties hereto and
thereto, will constitute valid and binding obligations of the Company
enforceable in accordance with their respective terms.
Section 7.02. REPRESENTATIONS AND WARRANTIES BY FTX. FTX represents and
warrants to FRP and the Company as follows:
(i) FTX has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Delaware and has full
corporate power and authority to enter into this Agreement and perform its
obligations hereunder.
(ii) This Agreement, the Employee Benefits Agreement and the Tax
Cooperation Agreement have been duly authorized by FTX and, upon the due
execution and delivery hereof and thereof by the parties hereto and
thereto, will constitute valid and binding obligations of FTX enforceable
in accordance with their respective terms.
Section 7.03. REPRESENTATIONS AND WARRANTIES BY FRP. FRP represents and
warrants to FTX and the Company as follows:
(i) FRP is validly existing as a limited partnership under the
provisions of the Delaware Revised Uniform Limited Partnership Act and has
full partnership power and authority to enter into this Agreement and
perform its obligations hereunder.
(ii) This Agreement has been duly authorized, executed and delivered
by FRP and, assuming the due execution and delivery hereof by the other
parties hereto, constitutes a valid and binding obligation of FRP
enforceable in accordance with its terms.
ARTICLE VIII
MISCELLANEOUS
Section 8.01. EXPENSES. FTX shall bear the expenses, costs and fees
(including attorneys', auditors' and financing commitment fees) in connection
with the Merger, the Contributions and the Distribution, except as set forth in
the following sentence. The listing fees of the N.Y.S.E. incurred with respect
to the listing of the Company Common Stock, the printing and mailing costs
relating to the Form 10 and Registration Statement, the filing fees with the
Commission in connection with the Distribution, the costs of the Distribution
Agent, any filing or recordation costs associated with the Contributions, and
any sales, use, transfer, stamp, recording, documentary or similar Taxes or
charges arising out of the Contributions will be divided evenly between FTX and
the Company.
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Section 8.02. NOTICES. All notices, requests and other communications
under this Agreement to any party hereto shall be in writing (including
facsimile or similar writing) and shall be given
If to FTX, to:
Freeport-McMoRan Inc.
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: General Counsel
Telecopier: (000) 000-0000
With a copy to:
IMC Global, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
Telecopier: (000) 000-0000
If to FRP, to:
Freeport-McMoRan Resource Partners
Limited Partnership
c/o Freeport-McMoRan Inc.
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: General Counsel
Telecopier: (000) 000-0000
With a copy to:
IMC Global, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
Telecopier: (000) 000-0000
If to the Company, to:
Freeport Sulphur Company
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
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Attention: President
Telecopier: (000) 000-0000
or to such other address or telecopier number as such party may hereafter
specify for the purpose by notice to the other parties. Each such notice,
request or other communication shall be effective (i) if given by facsimile,
when such facsimile is transmitted to the telecopier number specified in this
Section and transmission of the appropriate number of pages is confirmed or
(ii) if given by any other means, when delivered at the address specified in
this Section 8.02.
Section 8.03. AMENDMENT AND WAIVER. This Agreement may not be altered or
amended, nor may rights hereunder be waived, except by an instrument in writing
executed by each party, or in the case of a waiver by an instrument in writing
executed by the party against whom such waiver is to be effective.
Notwithstanding anything contained herein to the contrary, prior to the
Effective Time, this Agreement may not be altered or amended, nor may FTX or FRP
waive any of its respective rights hereunder, without the express written
consent of IGL. No waiver of any term, provision or condition of or failure to
exercise or delay in exercising any rights or remedies under this Agreement, in
any one or more instances, shall be deemed to be, or construed as, a further or
continuing waiver of any such term, provision, condition, right or remedy or as
a waiver of any other term, provision or condition of this Agreement.
Section 8.04. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original instrument but all of
which together shall constitute but one and the same Agreement.
Section 8.05. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF DELAWARE.
Section 8.06. ENTIRE AGREEMENT. This Agreement and the attachments hereto
(and, in the case of FTX and IGL, the Agreement and Plan of Merger and the
attachments thereto) constitute the entire understanding of the parties hereto
with respect to the subject matter hereof, superseding all negotiations, prior
discussions and prior agreements and understandings relating to such subject
matter.
Section 8.07. PARTIES IN INTEREST. This Agreement shall be binding upon,
and shall inure to the benefit of, each of the parties hereto and their
respective successors and permitted assigns (which shall include IGL as a result
of the Merger). Nothing contained in this Agreement, express or implied, is
intended to confer upon any person or entity other than the parties hereto, any
benefits, rights or remedies, provided, however, that notwithstanding anything
contained herein to the contrary, it is expressly agreed that IGL is an express
third party beneficiary of the rights of FRP and FTX hereunder by virtue of the
transactions contemplated by the Agreement and Plan of Merger between FTX and
IGL.
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Section 8.08. SPECIFIC ENFORCEMENT. Each party acknowledges that the
other parties hereto would be irreparably harmed by any breach of any of the
terms or conditions of this Agreement and that there would be no adequate remedy
at law or in damages to compensate such party for such breach. Each party
agrees that any other party shall be entitled to injunctive relief requiring
specific performance by the parties hereto of any provision of this Agreement,
and each of the parties consents to the entry thereof.
Section 8.09 ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any party hereto without
the prior written consent of the other party.
Section 8.10 SEVERABILITY. If any term or provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other terms, provisions and conditions of this Agreement shall
nevertheless remain in full force and effect so long as the economic and legal
substance of the transactions contemplated hereby are not affected in any manner
materially adverse to any party hereto. Upon any determination that any term or
other provision hereof 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 such parties as closely as possible in a mutually
acceptable manner in order that the transactions contemplated by this Agreement
may be consummated as originally contemplated to the fullest extent possible.
Section 8.11 FTX ALLOCATION TO FRP. Nothing in this Agreement shall
preclude FTX or any successor thereto from allocating any expenses for which it
is responsible hereunder to FRP to the extent that it is permitted to do so
under the Partnership Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
Freeport-McMoRan Resource Partners,
Limited Partnership
By: Freeport-McMoRan Inc., its Administrative
Managing General Partner and Special General
Partner
By: /s/ Xxxx X. Laitolais
--------------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: President and Chief Executive
Officer
Freeport-McMoRan Inc.
By: /s/ Xxxx X. Laitolais
--------------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: President and Chief Executive
Officer
Freeport Sulphur Company
By: /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President
