EXHIBIT 10.4
VENTURE PARTICIPATION AGREEMENT
between
SUN COMPANY, INC. (R&M)
LIQUID ENERGY CORPORATION
and
ENTERPRISE PRODUCTS COMPANY
Dated May 1, 1992
INDEX TO VENTURE PARTICIPATION AGREEMENT
Section Page
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1. Definitions ........................................................... 2
2. Establishment and Maintenance of the Partnership ...................... 5
3. Acquisition of the Site ............................................... 7
4. Certain Basic Commitments ............................................. 8
5. Operation of the Partnership .......................................... 9
6. Indemnities ........................................................... 11
7. Confidentiality, Restricted Disclosure and Limited Use Commitments .... 12
8. Assignment ............................................................ 15
9. Term and Termination .................................................. 16
10. Alternative Dispute Resolution ........................................ 17
11. Representations and Warranties ........................................ 21
12. Miscellaneous ......................................................... 23
VENTURE PARTICIPATION AGREEMENT
THIS AGREEMENT dated as of May 1, 1992, is among Sun Company, Inc. (R&M), a
Pennsylvania corporation ("Sun"), Liquid Energy Corporation. a Delaware
corporation ("LEC"), and Enterprise Products Company, a Texas corporation
("Enterprise"). Each of Sun, LEC and Enterprise are sometimes referred to
individually as a "Party" and collectively as the "Parties".
WITNESSETH:
WHEREAS, Sun. among other things, is engaged in the refining and marketing
of motor gasoline and, in connection therewith, requires quantities of methyl
tertiary butyl ether ("MTBE") for use as an oxygenate and octane enhancer for
blending with such gasoline; and
WHEREAS, the Parties each have quantities of isobutane available to supply
the necessary feedstock for the operation of an isobutane dehydrogenation and
MTBE production facility (hereinafter referred to as "Facility"); and
WHEREAS, the Parties desire to participate in the ownership, construction
and operation of such a Facility, from which Sun would obtain all of the
quantities of MTBE produced; and
WHEREAS, the Parties desire to form a joint venture in the form of a
partnership among themselves or their respective Subsidiaries, the purpose of
which is to jointly engage in the ownership or leasing, construction and
operation of a profitable Facility to produce MTBE for supply to Sun using
isobutane feedstocks supplied by each of the Parties, all on the terms and
conditions referenced herein;
NOW THEREFORE, in consideration of the foregoing and the mutual and
dependent agreements hereinafter set forth, the Parties hereby agree as follows:
1. Definitions. The following definitions shall apply in the interpretation
of this agreement unless otherwise provided:
1.1 "Affiliate(s)" means, as to the Party specified, an entity that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under control with, such Party.
1.2 "Agreement" means this Venture Participation Agreement and the
exhibits attached hereto.
1.3 "Construction Agreements" means, collectively the agreements pertaining
to the engineering and construction of the Facility, the content of which shall
be approved in advance by all of the Partners and entered into between the
Partnership and such engineers and contractors as are selected by agreement of
all the Partners.
1.4 "Controlling Shareholder" shall mean a natural person who directly owns
and/or controls more than fifty (50%) per cent of the voting stock of a Party.
1.5 "Enterprise Partner" means Enterprise or any assignee or successor
thereof permitted by the Partnership Agreement.
1.6 "Extended Services Agreement" means the agreement between the
Partnership and Enterprise for the provision of certain utilities and other
services for the benefit of the Facility, to be executed pursuant to Section 2.3
hereof, as the same may be amended from time to time as set forth therein.
1.7 "Facility" means the isobutane dehydrogenation and MTBE production
facility, having a minimum annual design production capacity of 193,450,000
gallons of MTBE, which the Partnership shall cause to be engineered and
constructed at the Site.
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1.8 "Financing" means the financing obtained for the benefit of the
Partnership prior to Start-Up (including loans for working capital for the
Partnership, construction loans, financing in the form of a lease or
sale/leaseback) and any subsequent refinancing of such obligations.
1.9 "Isobutane" means isobutane meeting the minimum specifications set
forth in the Isobutane Supply Agreements, as the same may be amended from time
to time as set forth therein.
1.10 "Isobutane Supply Agreements" means, collectively, the isobutane supply
agreement between each of the Parties and the Partnership, to be executed
pursuant to Section 21.3 hereof, as the same may be amended from time to time as
set forth therein.
1.11 "LEC Partner" means Liquid Energy Fuels Corporation, a Delaware
corporation which is a Subsidiary of LEC, or any assignee or successor thereof
PERMITTED by the Partnership Agreement.
1.12 "License Agreements" means, collectively, the written agreements
between the Partnership and the entities selected by agreement of all the
Partners whereby such entities shall supply and license to the Partnership, on
terms acceptable to the Partners, the isobutane dehydrogenation nation, MTBE and
other mutually acceptable technologies necessary to operate the Facility.
1.13 "Management Committee" means the Partnership's management committee,
as further described in this Agreement and in the Partnership Agreement.
1.14 "Mechanical Completion" means that date, determined pursuant to the
Construction Agreements, when the Facility is mechanically and structurally
complete such that commissioning of the Facility may be commenced in a safe and
orderly manner.
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1.15 "MTBE" means methyl tertiary butyl ether product meeting the
specifications set forth in the MTBE Off-Take Agreement, as the same
may be amended from time to time as set forth therein.
1.16 "MTBE Off-Take Agreement" means the agreement between Sun. or its
Affiliate, and the Partnership for the purchase and sale of MTBE to be executed
pursuant to Section 2.3 hereof, as the same may be amended from time to time as
set forth therein.
1.17 "Operator" means the Operator designated in the Plant Operating
Agreement.
1.18 "Partners" means, collectively, Sun Partner, Enterprise Partner and LEC
Partner.
1.19 "Partnership" means the general partnership between the Partners are
pursuant to Article 2 of the Partnership Agreement.
1.20 "Partnership Agreement" means the agreement among the Partners creating
the Partnership and executed pursuant to Section 2.3 hereof.
1.21 "Partnership Interest" means the respective ownership interest of each
of the Partners in the Partnership, as specified in Section 2.1 hereof or as
hereafter adjusted, from time to time, in accordance with the Partnership
Agreement.
1.22 "Plant Operating Agreement" means the agreement between Enterprise and
the Partnership with respect to operation of the Facility and executed pursuant
to Section 2.3 hereof, as the same may be amended from time to time as set forth
therein, or any successor agreement thereto.
1.23 "Project Services Agreement" means the agreement between Enterprise and
the Partnership, to be executed pursuant to Section 2.3 hereof, as the same may
be amended from time to time as set forth therein.
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1.24 "Site" means that certain real property located in Mont Belvieu. Texas
and owned by Enterprise, as more particularly described in Exhibit "A" attached
hereto.
1.25 "Start-Up" means the last day of the calendar month in which Facility
production, over a consecutive thirty (30) day period, first equals or exceeds
an average of 424,000 gallons of MTBE per day. In no event, however, shall
Start-Up be later than the first day of the month following the date that is
four (4) months after Mechanical Completion.
1.26 "Subsidiary" means, as to the Party specified, an entity that directly
or indirectly through one or more intermediaries, is wholly owned by such Party.
1.27 "Sun Partner" means Sun BEF, Inc. a Texas corporation which is a
Subsidiary of Sun, or any assignee or successor thereof permitted by the
Partnership Agreement.
2. Establishment and Maintenance of the Partnership.
2.1 The Parties desire to establish and maintain the Partnership to own
and operate the Facility in accordance with the terms of this Agreement and the
Partnership Agreement. Subject to adjustment only as permitted in the
Partnership Agreement, the Partnership Interest of each of the Partners shall
be as follows: Sun Partner - 33 1/3%, LEC Partner - 33 1/3%, and Enterprise
Partner - 33 1/3%.
2.2 As used throughout this Agreement and the Partnership Agreement, any
reference to any obligation of the Partners or of the Partnership, as the case
may be, shall, except as provided below or unless otherwise expressly agreed in
writing by all the Parties, he deemed to incorporate a corresponding obligation
of each Party to cause its respective Partner to perform such obligation or to
cause the Partnership to perform such obligation, as the case may be. The
Parties shall not be obligated hereunder to cause their respective Partners, or
to cause the Partnership, to repay any Partnership debt obtained in accordance
with Section 5.4(b) of this Agreement if (i) Parties whose respective Partners
control at least
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66 2/3% of the aggregate Partnership Interests expressly so agree in writing
and (ii) such Partnership debt shall be without recourse to or guaranteed by the
Parties which have so agreed.
2.3 (a) Simultaneously with the execution and delivery of this Agreement
(i) the Partners shall execute and deliver the Partnership Agreement; (ii) the
Partnership shall execute and deliver the Isobutane Supply Agreements, which
also shall be executed by Sun, LEC and Enterprise, respectively; and (iii) the
Partnership also shall execute and deliver the MTBE Off-Take Agreement, which
also shall be executed by Sun.
(b) At such time or times following execution of this Agreement as the
Management Committee deems appropriate, the Partnership also shall execute and
deliver (i) the Plant Operating Agreement, which also shall be executed by
Enterprise as initial plant operator, (ii) the Extended Services Agreement,
which also shall be executed by Enterprise; and (iii) the Project Services
Agreement, which also shall be executed by Enterprise.
(c) At such time or times as is or are appropriate, the Partners also
shall execute and deliver such certificates, consents and other documents as may
be necessary or appropriate to enable the Partnership to conduct the business
contemplated by the Partnership Agreement, to qualify the Partnership as a
general partnership in good standing under the laws of the State of Texas, and
to qualify it to do business in the State of TEXAS and any other appropriate
location for the purpose of conducting such business.
2.4 Unless otherwise expressly agreed in writing by all the Parties, each
Party agrees to either be the Partner or maintain its respective Partner as its
Subsidiary to not permit the liquidation or dissolution of such Partner, and to
maintain or cause such Partner to maintain its Partnership Interest from the
date of the formation of the Partnership until such time as the Partnership is
terminated or such Partnership Interest is transferred in accordance with the
provisions of the Partnership Agreement. Each Party shall cause all
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stock, if any, of its respective Partner which is a Subsidiary to be represented
by certificates bearing the following legend conspicuously evidencing this
restriction on transfer:
"RESTRICTIONS ON TRANSFER
The share(s) of stock represented by this certificate are subject to
restrictions on transfer imposed by that certain Venture Participation
among Enterprise Products Company, Sun Company, Inc. (R&M) and Liquid
Energy Corporation, dated May 1, 1992. This stock shall not be sold,
assigned, pledged, donated, exchanged, disposed of, or otherwise
transferred or encumbered, directly or indirectly, except as permitted by
such Agreement."
Notwithstanding the foregoing, a Party or its respective Partner shall be
permitted to pledge ail or any portion of the stock of such Partner which is a
Subsidiary if, and only to the extent that, such pledge is necessary to secure
financing for the benefit of the Partnership and the prior written consent to
the making of such pledge has been obtained from each of the remaining Parties.
3. Acquisition of the Site.
At such time as they deem appropriate following execution of the Partnership
Agreement, the Partnership shall either (a) purchase from Enterprise, in which
case Enterprise shall sell to the Partnership, the Site for a per acre price
equal to the per acre price paid by Enterprise for the such parcel or (b) select
an alternative site for acquisition by the Partnership, in which event, Section
1.24 and Exhibit "A" attached hereto shall be amended accordingly. In the event
the Partnership determines it no longer has a need for the Site, it shall notify
Enterprise in writing that it desires to abandon the Site for Partnership
purposes and Enterprise shall have sixty (60) days in which to respond in
writing that it desires to reacquire the Site for the same price per acre paid
by the Partnership to acquire such Site. If Enterprise does desire to reacquire
the Site, the Partnership shall convey title to Enterprise as soon as the
closing can be accomplished.
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4. Certain Basic Commitments.
4.1 For as long as the Partners shall maintain their respective Partnership
Interests, each Partner shall make available the member or members of the
Management Committee that it is entitled to appoint pursuant to the
Partnership Agreement at no cost to the Partnership. The Partnership's business
and operations shall be managed by the Management Committee as provided in the
Partnership Agreement. Members of the Management Committee shall not be
employees of the Partnership.
4.2 Operating personnel shall be provided by Operator pursuant to, and
compensated in accordance with, the Plant Operating Agreement. Unless otherwise
agreed by the Parties, accounting, legal, tax, invoicing and other
administrative support activities required by the Partnership from time to time
shall be performed pursuant to the Plant Operating Agreement and/or the Project
Services Agreement.
4.3 This Agreement establishes no special or cooperative relationship among
the Parties except as to the business of the Partnership. This Agreement shall
be implemented and the Partnership conducted in a manner assuring that the joint
endeavor shall be strictly confined to such business. In particular, the Parties
and their respective Affiliates shall not exchange non-public information or
data except to the extent necessary to accomplish, and solely in connection
with the conduct of, such business and the related commitments contained in
this Agreement. Also, each Party reserves and is hereby granted the right to
make and enter into contracts with third parties for the sale or purchase of
isobutane, the sale or purchase of MTBE, the sale or purchase of any other goods
and services and the operation of other facilities, to the extent the same are
not required for meeting any obligations contemplated by this Agreement.
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5. Operation of the Partnership.
5.1 The Partnership shall be organized. managed and terminated as set forth
in the Partnership Agreement and all Partnership decisions and commitments shall
be made as provided therein.
5.3 Except as specifically provided herein or in any of the agreements
contemplated herein. or unless otherwise expressly agreed by all the Partners,
the Partners shall share all profits and losses of the Partnership in proportion
to their respective Partnership Interests, as further provided in the
Partnership Agreement.
5.3 Except as specifically provided herein or in any of the agreements
contemplated herein, or unless otherwise expressly agreed by all the Partners.
the Parties and their Affiliates shall receive no payments for services or
property donated or otherwise made available to the Partnership.
5.4 (a) In accordance with the Partnership Agreement, the Partnership may
from time to time make capital calls on the Partners. Unless otherwise agreed to
by all the Parties or unless excused in accordance with the last sentence of
Section 2.2, each Party agrees to make or cause to be made, contributions in
amounts equal to its respective Partner's share of any such capital call
required in accordance with the Partnership Agreement.
(b) In accordance with the Partnership Agreement, the Partnership may
from time to time incur debt or other obligations in the name of the
Partnership. In the event that all the Parties agree, such debt or obligation
may be secured by guarantees of the Parties or any of their respective
Affiliates. Any such guarantee shall be on the basis of each Party's respective
Partner's Partnership Interest and on a several but not joint basis unless some
other basis is agreed to in writing by the Parties. In addition, any such
guarantees shall contain a provision stipulating that, in the event any
Partner(s) purchases another Partner's Partnership Interest, as permitted by
Section 8.2 of this Agreement, the
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guaranteeing entities of such purchasing Partner(s) shall assume any guarantee
obligations of the departing Partner's guarantor thereunder, whereupon such
guarantor shall be deemed to be released from such obligations. The Parties and
the Partners shall use their best efforts to assure that any loan agreement and
any other documents governing such guaranteed financing (i) shall not include
as an event of default the bankruptcy or insolvency of any guarantor or any
event relating thereto; (ii) shall in the case of an event of default or failure
to perform by any guarantor permit each solvent guarantor to repay its portion
of the guaranteed financing in accordance with the originally scheduled
maturities and other terms without regard to any acceleration of any portion of
such guaranteed financing, or any other modification of terms (e.g., higher
interest rate), due to bankruptcy, insolvency or any related event concerning
any other guarantor(s); and (iii) shall not permit the lenders to ; foreclose on
the Facility.
5.5 All intellectual property including, without limitation, inventions,
know-how, trademarks, trade names and works of authorship, made or discovered by
the Partnership shall remain the property of the Partnership. Each Party
warrants that any inventor or creator of said intellectual property who is an
employee, agent or otherwise under the control of said Party or an Affiliate
thereof is under an obligation to assign said intellectual property to said
Party or Affiliate. Upon said invention or creation, each Party, agrees to cause
said inventor to assign his rights to the Partnership and to take those steps
necessary ,to perfect the Partnership's rights in said intellectual property,
including the application for and prosecution of patent applications which may
be filed on any inventions arising hereunder, the cost of such steps to be for
the account of the Partnership. If said rights are vested in the Party or an
Affiliate thereof, said Party or Affiliate agrees to assign said rights to the
Partnership. The Partnership agrees to take all steps necessary to maintain said
intellectual property rights, including the payment of appropriate patent
application and maintenance fees, unless such rights are released by the
Management Committee. In the event the Partnership decides not to maintain said
intellectual property rights, the Partnership shall assign said rights to the
individual Parties, jointly and severally. However, use of such intellectual
property by any Party or Affiliate thereof for purposes other than Partnership
business (e.g., to support other business of such party) shall be permitted at
any
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time after the Parties have, by unanimous agreement, committed to cause the
Facility to be constructed as contemplated herein.
5.6 The Partnership shall conduct its business consistent with procedures
and safeguards adopted by it to effectively isolate and insulate all market
sensitive information pertaining to the business and operations of the
Partnership so that such information is not available to persons not needing it
for managing or conducting the business affairs of the Partnership; provided
that such information shall be made available, under appropriate safeguards, as
required by any federal, state or local law, rule or regulation, by order of any
court or regulatory agency, or as otherwise agreed by the Partners. The Parties
and the Partners shall severally take appropriate measures pertaining to
activities of their respective personnel designed to secure to the Partnership
appropriate confidentiality for all such market sensitive information pertaining
to prices and production and all policies, strategies, plans, data and other
information pertaining to either prices or production.
6. Indemnities.
6.1 Each Party to this Agreement shall indemnify, hold harmless and defend
the Partnership, the other Parties and their Affiliates, as the case may be,
from and against all Suits, claims, demands, losses, damages and expenses
arising from or incident to any infringement or claimed infringement of any
patent or other rights for which such Party is responsible. A Party shall be
deemed responsible for such infringement if such infringement results from the
use, in connection with the manufacturing, selling or distributing activities
contemplated by this Agreement, of patented inventions, know-how or other
intellectual property furnished by such Party (or its Affiliates) to the
Partnership, to another Party or another Party's Affiliates. The Partnership
shall be deemed responsible for such infringement if such infringement results
from the use, in connection with the operating, selling or distributing
activities contemplated by this Agreement, of patented inventions, know-how or
other intellectual property obtained by the Partnership or owned by the
Partnership pursuant to Section 5.5 of this Agreement.
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6.2 Each Party shall be required to indemnify, hold harmless and defend the
other Parties and their Affiliates, as the case may be, with respect to any
claims, liabilities, damages and losses resulting from its own gross negligence
or will1ful misconduct, except as otherwise expressly provided in any agreement
between such Party and the Partnership. Additionally, each Party shall
indemnify, hold harmless and defend the other Parties and their Affiliates, as
the case may be, with respect to any liabilities for debt which are, by
agreement of such Party to be borne severally by such Party and not jointly by
all the Parties or the Partnership. Except for the aforementioned situations
where a Party is required to indemnify, hold harmless and defend the others,
unless otherwise unanimously agreed by the Parties, each Party shall indemnify,
hold harmless and defend the others and their Affiliates, as the case may be.
proportion to its Partner's Partnership Interest, from and against any and all
claims, liabilities, damages and losses, including attorney's fees, imposed upon
such other Parties and Affiliates and in any way arising out of or relating to
the Partnership, including but not limited to those arising from any breach of
contract by the Partnership, or any transactions contemplated by this Agreement
or under-taken by the Partnership.
7. Confidentiality. Restricted Disclosure and Limited Use Commitments.
7.1 Each Party shall, and shall assure that their respective Affiliates
shall, (i) treat as confidential all Confidential Information (as hereinafter
defined) which such Party or its Affiliates obtain directly or indirectly in
connection with this Agreement or the Partnership, and (ii) not disclose the
same to others nor use the same, except as provided herein, from the date of
this Agreement until ten (10) years following termination of this Agreement. The
obligation of this Section 7.1 shall apply, without limitation, to all
information learned by any Party in the course of negotiating or implementing
this Agreement concerning the business, assets, customers, processes or methods
of another Party or its Affiliates.
As used herein. "Confidential Information" means any information of any Party
or the Partnership that might reasonably be considered secret, sensitive or
private, including but not limited to the following:
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(a) Data, know-how, formulae, processes, designs, plans,
specifications, reports, financial information, studies, findings, inventions
and ideas, or other information relating to the Partnership, or methods or
techniques used by the Partnership, whether or not contained in samples,
documents, sketches, photographs, drawings, lists, and the like;
(b) Data and other information employed or acquired in connection with
the sales to, or marketing of the products of, any Party, including cost
information business policies and procedures, revenues and markets, distributors
and customers, and similar items of information whether or not contained in
documents or other tangible materials; and
(c) Any other information of a Party obtained by the other Parties to
this Agreement during the term hereof, that is not generally known to, and not
readily ascertainable by proper means by, third parties who could obtain
economic value from its use or disclosure.
To the extent practicable, documents and other tangible materials containing
Confidential Information shall be marked "Proprietary" or "Confidential". Each
Party shall take all appropriate steps to prevent unauthorized disclosure of any
Confidential Information by its Affiliates and employees, which steps include
the execution by all such persons of written agreements containing obligations
of confidentiality, restricted disclosure and limited use relative thereto
consistent with this Article 7. The Parties shall not permit access to
Confidential Information by their Affiliates and employees, except on a need-
to-know basis. The Partnership shall likewise comply with this Article 7.
7.2 (a) The obligations of Section 7.1 shall not apply to Confidential
Information after (i) it has become generally available to the public through no
fault of the receiving Party or any of its Affiliates, (ii) it was in the
receiving Party's or Affiliate's possession before disclosure hereunder and did
not come directly or indirectly from another Party or its Affiliates, or (iii)
it becomes known to the receiving Party or Affiliate through lawful disclosure
from a source that is not another Party or an Affiliate of another Party, and
that at the time is under no obligation not to disclose it to the receiving
Party or its Affiliate.
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(b) Confidential Information may be disclosed by a recipient Party to
one or more of its Affiliates to the extent necessary or appropriate to carry
out such Party's responsibilities of this Agreement, provided that if the
Confidential Information relates to businesses or activities of a nother Party
or Affiliates, other than the business of the Partnership, it shall not be
disclosed to any of the recipient Party's Affiliates unless the Confidential
Information is directly related to the business of the Partnership and the
proposed disclose has a need to know such Confidential Information to conduct
such business successfully.
(c) Confidential Information may be disclosed (i) in accordance with
the License Agreements; (ii) to contractors and consultants only if directly
related to the business of the Partnership and only to the extent necessary to
facilitate the construction, extension, modification, operation or repair of
the Facility and equipment of the Partnership; and (iii) to lenders, auditors
and rating agencies only if directly related to the financial affairs of the
Partnership and only to the extent the proposed disclosee has a need to know
such Confidential Information to facilitate the financial affairs of the
Partnership or to perform an audit of the Party or its Affiliate; provided that
the proposed disclosee first signs an agreement with obligations at least
consistent with the other provisions of this Article 7. In the event the
proposed disclosee refuses to sign such an agreement, no such disclosure shall
be made, except as specifically approved by the Management Committee.
(d) Such obligations shall not be deemed to obligate any Party to do
or refrain from doing any act, the doing or not doing of which would cause or
reasonably be expected to cause such Party to fail to fulfill or comply with any
obligation or requirement imposed by any applicable law, governmental regulation
or stock exchange rule, provided, that. any disclosures of Confidential
Information made to fulfill or comply with any such law, regulation or rule
shall be made (i) only after notice, whenever practicable, to the other Parties,
and (ii) under conditions invoking all confidentiality protections as are
available by law, regulation or rule.
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7.3 Except as specifically provided in this Agreement, no right or license
granted to use any Confidential Information disclosed to or otherwise obtained
by any person or entity in the course of the negotiation or implementation of
this Agreement or otherwise in connection therewith.
7.4 Each Party shall be responsible for assuring full compliance, by itself,
its affiliates, and all employees and other personnel of itself and its
Affiliates, with the obligations of Section 7.1 of this Agreement. Each Party
shall take all necessary measures to assure such compliance.
7.5 Each Party shall permit the others to review in advance and approve the
form of any written descriptions or written announcements including press
releases concerning this Agreement or the Partnership.
8. Assignment.
8.1 The Parties acknowledge that each Party, its Controlling Shareholder, if
any and its respective Partner were selected to participate in this venture due
to certain contributions and strengths of such party that the remaining Parties
view as essential to the success of the venture, such that any transfer,
conveyance, pledge or other encumbrance thereinafter "Transfer") by a Party or
its Controlling Shareholder of the interest herein of such Party or such
Controlling Shareholder to a third party may substantially diminish the value of
the remaining Parties' interests. For that reason, and due to the confidential
nature of much of the information to be exchanged and generated at the
Partnership level, the Parties wish to limit the right of a Party or a
Controlling Shareholder to Transfer its or his interest in this Agreement, all
as set forth below in this Article 8.
8.2 No Party may Transfer this Agreement, or any rights or obligations
hereof, whether voluntarily or by operation of law, without the prior written
consent (and on such terms and conditions as may be contained therein) of the
remaining Parties, which consent will not be unreasonably withheld; provided
that a Party may Transfer this Agreement
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without the prior written consent of the remaining Parties if (a) the Transfer
is to any of its affiliates or it occurs by reason of the merger, consolidation,
or transfer of stock or partnership interest of such Party with or to an
Affiliate, (b) the Transferee Party's Partner's either the Transferee itself
or a Subsidiary of such Transferee and (c) if such Transfer takes place during
the Deferred Period defined below, the Controlling Shareholder remains in
control of the Transferee. Any Transferee permitted by this Section 8.2 shall
be required to execute and deliver to the remaining Parties a written agreement
whereby it assumes all rights and responsibilities of the Transferor under this
Agreement. Any Transfer in violation of the foregoing shall be void.
8.3 Furthermore, prior to final repayment of the Financing, or five (5) years
from the date of Start-Up, whichever occurs later (hereinafter the "Deferred
Period"), a Controlling Shareholder (if any) may not Transfer this Agreement, or
any rights or obligations hereof, whether voluntarily or by operation of law,
without the prior written consent (and on such terms and conditions as may be
contained therein) of the remaining Parties, which consent will not be
unreasonably withheld. After the Deferred Period, any such Transfer may be made
by a Controlling Shareholder without the consent of the remaining Parties.
9. Term and Termination.
9.1 Term. This Agreement shall continue in full force and effect from the
date hereof until such time as only one Party's Partner (including permitted
successors, assigns or transferees of any original Party to this Agreement)
holds any Partnership Interest, until the Partnership is dissolved and the
winding up of its affairs is completed in accordance with Article 12 of the
Partnership Agreement, or until this Agreement is terminated pursuant to Section
9.2 below. Unless otherwise provided therein, expiration or termination of this
Venture Participation Agreement shall not cause the termination of any of the
agreements executed pursuant hereto.
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9.2 Termination. (a) This Agreement shall terminate as to all of the Parties
upon occurrence of any of the following:
(i) the mutual written agreement to terminate by all of the Parties;
(ii) at the option of a non-breaching Party, in the event that any
other Party or any of its Affiliates breaches a material term or condition of
this Agreement or of the Partnership Agreement and fails to cure, or to initiate
action necessary to cure with reasonable diligence, the same within fifteen (15)
days of written notice thereof from such non-breaching Party; or
(iii) at the option of the other Parties upon the making of an
assignment by a Party for the benefit of its creditors, or the appointment of a
receiver or trustee for all or a part of a Partys property, or the filing of a
petition by or against a Party for its reorganization or for an arrangement
under any bankruptcy law or other law, provided that said Party shall have sixty
(60) days in which to discharge such proceedings if the same are involuntarily
brought.
(b) This Agreement shall terminate as to any Party whose Partner ceases
to own any Partnership Interest as the result of the purchase of such
Partnership Interest pursuant to Section 10.2 or 11.2(a) (ii) of the Partnership
Agreement.
10. Alternative Dispute Resolution.
10.1 Commitment To Alternate Dispute Resolution. The Parties intend to and
do hereby establish an Alternative Dispute Resolution ("ADR") procedure to be
followed by the Parties hereto in the event any controversy should arise out of
or relate to this Agreement or the performance hereof.
10.2 Step One: Correspondence, Followed By Meeting. (a) Any Party hereto
may initiate ADR proceedings by sending a written notice (in the manner
provided in Section
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12.2 below) to the other Party(s) setting forth the particulars of the dispute,
the term(s) of the Agreement that are involved, and a suggested resolution of
the problem. The sending of such a notice will toll the running of any
applicable statute of limitation.
(b) The recipient(s) of the notice must respond by appropriate written
notice thin 20 days with its (their) response(s) to the proposed solution. The
failure of the recipients(s) to send such response notice shall not impair
their rights or remedies subsequent in the ADR process or thereafter.
(c) If correspondence does not resolve the dispute, then the Parties
hereto shall meet within 15 days of the receipt of the response at a mutually
acceptable place and attempt to resolve the matter.
(d) If this meeting is not productive of a resolution, then senior
executive officers of each of the Parties are authorized to and shall meet
within 30 days of the first meeting of the Parties and personally confer in a
bona fide attempt to resolve the matter. Should this step not produce
resolution, then the Parties agree to mediation as provided in Article 10.3,
hereinbelow.
10.3 Step Two: Non-Binding Mediation. (a) In the event that the controversy
is not resolved by informal negotiation within 30 days (or any mutually agreed
extension of time) of the first meeting between the executives, the case may be
referred by any Party hereto to any mutually acceptable arbitration and
mediation service ("mediation service") for an informal, non-binding conference
or conferences between the Parties in which a neutral mediator will seek to
guide the Parties to a resolution of the case.
(b) If the Parties to the controversy can agree that the controversy
involves primarily a given area or field of expertise (for example, an
accounting issue or a dispute involving petrochemical engineering), then such
Parties shall instruct the mediation service to provide a list and the resumes
of professionals in that area or field of expertise who would be willing to
serve as a mediator. If the Parties are not able to so agree, then the
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mediator shall be a retired judge or justice at the mediation service. In
either case, the Parties are free to select any mutually acceptable panel
member of the list so provided by the mediation service. If the Parties cannot
agree or have no particular choice of mediator, then a list and resumes of
available mediators numbering one more than there are Parties will be sent to
the Parties, each of who may strike one name leaving the remaining name
as the mediator. If more than one name remains, the designated mediator shall be
selected by the mediation service from the remaining names.
(c) The steps provided hereinabove dealing with mandatory negotiation
and mandatory mediation are deemed arbitration clauses for the purpose of
enforcing compliance with their provisions, but not for the purposes of
enforcing the mediator's decision or recommendation (which the Parties
acknowledge is non-binding). Any Party to this Agreement may seek compliance
with these contract provisions by petition to any court of general
jurisdiction. The prevailing Party in any such motion shall be entitled to the
court's order for payment of attorney fees and costs in connection with said
motion.
(d) The mediation process is to be considered settlement negotiation
for the purpose of all state and federal rules protecting disclosures made
during such conferences from later being discovered or used in evidence. The
entire mediation procedure is confidential, and no stenographic or other record
shall be made save and except to reviews and memorialize a settlement record.
All conduct, statements, promises, offers, views, opinion, oral or written,
made in the course of the mediation by any Party or their agent, employee. or
attorney are confidential and, where appropriate, are to be considered attorney
work product and privileged. Such conduct, statements, promises, offers, views
and opinions shall not be discoverable nor admissible for any purpose, including
impeachment, in any adjudication of or other proceeding involving the Parties;
provided, however, that evidence otherwise discoverable or admissible is not
excluded from discovery or admission in evidence simply as a result of its being
used in connection with this settlement process.
(e) In the event any Party has substantial need for information in
possession of any other Party in order to prepare for the mediation
conference(s), the Parties shall
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attempt in good faith to agree upon procedures for the expeditious exchange of
such information, with the help) of the mediator if required.
(f) No later than one week prior to the first scheduled mediation
session, each Party shall deliver to the mediator and at the same time serve a
copy on all other Parties a concise written summary of its position, including
a proposed solution to the matter(s) in controversy, and all necessary
documents.
(g) The mediator at some point in the mediation process will, if
requested by any of the Parties, give an opinion on the probable outcome of the
case and the ranges of values both in terms of settlement and trial if the
matter were to be adjudicated. The mediator will, in the absence of an instr-
uction from the Parties to the contrary, give recommendations on terms of
possible settlement conditions to be imposed upon the Parties (if appropriate).
The mediator's opinion shall be based on the material and information then
available to all Parties. The opinions and recommendations of the mediator are
not binding on the Parties.
(h) The fees and costs of the mediation shall be in accordance with the
then current fee schedule at the mediation service and will, in the absence of
an agreement to the contrary, be borne equally by all Parties.
(i) The mediation process shall continue until the matter is resolved
or the mediator makes a good faith finding that all reasonable settlement
possibilities have been exhausted and there is no possibility of resolution
through mediation.
(j) Any previously tolled statute of limitation will begin running
again upon the mediator's finding that the mediation process is concluded. If
the mediation process concludes without final resolution of all disputes, then
the Parties shall, subject to Section 10.4 below, be free to pursue all rights
and remedies at law or in equity which they may otherwise have available.
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10.4 Step Three: Adjudication by Binding Arbitration After Failed
Mediation. Should any disputes remain existent between the Parties after
completion of the mediation process set forth above, then all remaining
controversies or claims arising out of or relating to this Agreement or the
performance thereof shall be settled by final and binding arbitration in
accordance with the Rules of Practice and Procedure for the Arbitration of Com-
mercial Disputes attached hereto as Exhibit "B" and made a part hereof.
11. Representations and Warranties.
11.1 Sun hereby represents and warrants to Enterprise and LEC as follows:
(a) Each of Sun and the Sun Partner is a corporation duly organized,
validly existing and in good standing under the laws of the state of its
respective incorporation and is duly qualified to do business wherever necessary
to carry on its present operations.
(b) The execution, delivery and performance by each of Sun and the Sun
Partner of this Agreement and the documents referenced herein to which each is
or is to be a party have been authorized by all necessary corporate action, and
do not and will not: (i) require any consent or approval of the stockholders of
any such Party, (ii) violate any law, rule, regulation, order, or decree
presently in effect and having applicability to any such party, or (iii) violate
its charter or by-laws.
(c) This Agreement is the legal and binding obligation of Sun,
enforceable in accordance with its terms against Sun; and any other document
required by this Agreement to be delivered by Sun, or the Sun Partner hereunder,
when duly executed and delivered by such parry will be the legal and binding
obligation of such party, enforceable in accordance with its terms against such
party.
-21-
11.2 Enterprise hereby represents and warrants to Sun and LEC as follows:
(a) Enterprise is a corporation duly organized, validly existing and
in good standing under the laws of the state of its incorporation and is duly
qualified to do business wherever necessary to carry on its present operations.
(b) The execution, delivery and performance by Enterprise of this
Agreement and the documents referenced herein to which it is or is to be a party
have been authorized by ail necessary corporate action, and do not and will not:
(i) require any consent or approval of its stockholders, (ii) violate any law,
rule, regulation. order, or decree presently in effect and having applicability
to it, or (iii) violate its charter or by-laws.
(c) This Agreement is the legal and binding obligation of Enterprise,
enforceable in accordance with its terms against Enterprise; and any other
document required by this Agreement to be delivered by Enterprise, whether as a
Party or a Partner hereunder, when duly executed and delivered by Enterprise,
will be the legal and binding obligation of Enterprise, enforceable in
accordance with its terms against Enterprise.
11.3 LEC hereby represents and warrants to Sun and Enterprise as follows:
(a) Each of LEC and the LEC Partner is a corporation duly organized,
validly existing and in good standing under the laws of the state of its
respective incorporation and is duly qualified to do business wherever necessary
to carry on its present operations.
(b) The execution, delivery and performance by each of LEC and the LEC
Partner of this Agreement and the documents referenced herein to which each is
or is to he a party have been authorized by all necessary corporate action, and
do not and will not: (i) require any consent or approval of the stockholders of
any such party, (ii) violate any law, rule, regulation, order, or decree
presently in effect and having applicability to any such party, or (iii) violate
its charter or by-laws.
-22-
(c) This Agreement is the legal and binding obligation of LEC,
enforceable in accordance With its terms against LEC; and any other document,
required by this Agreement to be delivered by LEC, or the LEC Partner hereunder.
when duly executed and delivered by such party, will be the legal and binding
obligation of such party, enforceable in accordance with its terms against
such party.
12. Miscellaneous.
12.1 This Agreement, along with the agreements referenced herein, shall
constitute the entire agreement among the Parties with respect to the subject
matter hereof, and shall supersede all prior agreements or understandings, oral
or written, among the Parties with respect thereto and no amendment or
modification of any provision of this Agreement shall be effective unless in
writing and signed by all Parties. In the event of any inconsistency between the
provisions of this Venture Participation Agreement and any of the agreements
referenced herein, the provisions of this Venture Participation Agreement shall
control.
12.2 All notices, requests, demands, directions and other communications
provided for herein shall be in writing and shall be deemed to have been
properly given or made if (i) delivered in person, sent by overnight courier,
facsimile or tested telex to the applicable Party or Parties at the address(es)
for personal delivery indicated below, or (ii) mailed, postage prepaid, by
certified or registered mail with return receipt requested, to the applicable
Party or Parties at the address(es) for mail indicated below:
(a) Sun:
for personal delivery: for mail:
Sun Company, Inc. (R&M) Sun Company, Inc. (R&M)
0000 Xxxxxx Xxxxxx 0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx. XX 00000
Attn: Xxxx X. Xxxxxx Attn: Xxxx X. Xxxxxx
Telex: RCA 244941
Facsimile: (000) 000-0000
With Copy to: Law Department
Facsimile: (000) 000-0000
-23-
(b) LEC:
for personal delivery: for mail:
Liquid Energy Corporation Liquid Energy Corporation
0000 Xxxxxxxxxx Xxxxx P. 0. Xxx 0000
Xxx Xxxxxxxxx. XX 00000 The Xxxxxxxxx. XX 00000
Attn: Sr. Vice President Attn: Sr. Vice President
Telex: 775889 MEDCWDLS
Facsimile: (000) 000-0000
(c) Enterprise:
for personal delivery: for mail:
Enterprise Products Company Enterprise Products Company
0000 Xxxxx Xxxx Xxxx P. 0. Xxx 0000
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
Attn: President Attn: President
Telex: 3734597
Facsimile: (000) 000-0000
Notice given as aforesaid shall be deemed to have been given upon receipt or
refusal of receipt by the addressee. Any Party may change its respective
address, telex or facsimile number by giving written notice of such change to
the remaining Parties in accordance with the terms of this Section.
12.3 The failure of any Party to enforce any right or provision hereof
shall not be considered a waiver by such Party of its right to enforce such
right or provision in the future.
12.4 THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW. IN IMPLEMENTING THIS AGREEMENT THE PARTIES SHALL COMPLY WITH ALL
APPLICABLE LAWS, RULES AND REGULATIONS, AND NO PROVISION(S) OF THIS AGREEMENT
SHALL BE CONSTRUED TO PROVIDE OTHERWISE.
12.5 Any provision of this Agreement which is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or
-24-
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
12.6 The following provisions shall survive any termination of this
Agreement: Sections 5.5 and 5.6 and Articles 6, 7, 10 and 12.
12.7 Captions contained in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
12.8 Terms stated in the masculine gender shall be construed, as appropriate
in context, as applying to the neuter gender, and vice versa, and terms stated
in either such gender shall be construed, as appropriate in context, as applying
to the feminine gender. Terms stated in the singular shall be construed, as
appropriate in contex as the plural, and vice versa.
12.9 This Agreement may be executed in several separate counterparts each of
which shall be an original and all of which taken together shall constitute one
and the same agreement.
12.10 This Agreement shall be binding upon and inure to the benefit of the
Parties and their permitted successors and assigns, but shall not otherwise
inure to the benefit of any other third party.
-25-
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized.
SUN COMPANY, INC. (R&M)
By: /s/ XXXXX X. XXXXX
-----------------------------
Name Printed: Xxxxx X. Xxxxx
Title: President
ENTERPRISE PRODUCTS COMPANY
By: /s/ XXXXXXX X. XXXX
----------------------------
Name Printed: Xxxxxxx X. Xxxx
------------------
Title: Executive Vice President
-------------------------
LIQUID ENERGY CORPORATION
By: /s/ XXXXXXX X. XXXXXXXX
----------------------------
Name Printed:Xxxxxxx X. Xxxxxxx
Title: Sr. Vice President
-------------------------
-26-
EXHIBIT "B"
RULES OF PRACTICE AND PROCEDURE
FOR THE ARBITRATION
OF COMMERCIAL DISPUTES
1. AGREEMENT OF PARTIES
The parties shall be deemed to have made these rules a part of their
arbitration agreement whenever they have provided for arbitration of disputes.
The parties, by written agreement, may vary the procedures set forth in these
rules.
2. INITIATION OF ARBITRATION
Arbitration shall be initiated in the following manner:
(a) Unless barred by an applicable statute of limitations, any party bound
by the arbitration agreement which has a claim, dispute or controversy
("Claimant") may initiate an arbitration by serving all other parties to the
arbitration agreement ("Respondent(s)") with written notice ("Claimant's
Notice") of the nature of the claim, dispute or controversy, a demand for
arbitration and Claimant's selection of a nationally recognized arbitration
service ("Arbitration Service") which utilizes former judges and/or justices as
arbitrators. A claim shall be waived and forever barred if on the date
Claimant's Notice is received by Respondent(s), the claim is found by the
Arbitrator (selected as provided hereinbelow) to be barred by the applicable
statute of limitation (after allowing for any agreed tolling of such statute of
limitations).
(b) Respondent(s) shall, in a written response delivered to Claimant within
ten (10) days of receipt by Respondent(s) of Claimant's Notice, either consent
to Claimant's selection of the Arbitration Service or select an alternative
Arbitration Service. If Respondent(s) fail or refuse timely to either consent or
select an alternative, then Claimant's selection shall be utilized as the
Arbitration Service hereunder. If Respondent(s) select an alternative
Arbitration Service then Claimant and Respondent(s) shall immediately attempt
to reach agreement on a mutually acceptable Arbitration Service. If such
agreement is not reached within ten (10) days of Respondent(s)' selection of an
alternative Arbitration Service then the American Arbitration Association shall
be utilized as the Arbitration Service hereunder.
(c) Respondent(s) shall file an answering statement, including
counterclaim, if any, with Claimant within thirty (30) days of receipt of
Claimant's Notice. If a counterclaim is asserted, it shall contain a statement
setting forth the nature of the counterclaim, the amount involved, if any, and
the remedy sought. If no answering statement is filed within the stated time, it
will be treated as a denial of the claim. Failure to file an answering statement
shall not operate to delay the arbitration.
Exhibit "B" Page 1
(d) Claimant and Respondent(s) shall file copies of the notice of claim and
answering statement, the amount involved, if any, and the remedy sought with the
Arbitration Service upon its selection, together with appropriate filing fees as
required by such service.
3. CHANGES OF CLAIM
After filing a claim if either party desires to make any new or different
claim or counterclaim, same shall be made in writing and filed with the
Arbitration Service and a copy shall be mailed to the other party, who shall
have a period of ten (10) days from the date of such mailing within which to
file an answer with the Arbitration Service. After the Arbitrator is appointed
hereinbelow, however, no new or different claim may be submitted except with the
Arbitrator's consent.
4. SELECTING THE ARBITRATOR
The arbitration will be heard and presided over by a single neutral
arbitrator ("Arbitrator") selected by mutual agreement from the Arbitration
Service's panel. If the parties are unable to agree on an Arbitrator within
thirty (30) days of the selection of the Arbitration Service, the Arbitration
Service will provide a list of prospective arbitrators from their panel
numbering one more than there are parties to the dispute. Each party may then
strike one name and the remaining panelist will serve as the designated
Arbitrator. If more than one panelist remains, then the Arbitration Service
shall choose one of the remaining panelists to serve as the designated
Arbitrator.
If, for any reason, the Arbitrator should fail or be unable to perform the
duties of his office, then the Arbitration Service may declare the office vacant
and said vacancy shall be filled in accordance with the terms of this Article
for the original designation of Arbitrator.
5. PRE-HEARING CONFERENCE
Once the Arbitrator has been selected, he will promptly schedule a pre-
hearing conference for the purpose of ascertaining and narrowing the issues,
establishing a discovery plan and selecting settlement conference dates, as well
as establishing such other rules and procedures as may be agreed upon by the
parties, or ordered by the Arbitrator in furtherance of the prompt resolution of
the dispute.
6. SETTLEMENT CONFERENCE
Settlement conferences may be ordered at such times during the pendency of
the arbitration as may be deemed appropriate by the Arbitrator or at any time
upon the request of one or all of the parties. At least one settlement
conference must be held prior to the commencement of the arbitration hearing.
Exhibit "B" Page 2
7. DISCOVERY
Discovery shall be at the discretion of the Arbitrator and allowed upon a
showing of good cause utilizing the following guidelines:
(a) The Arbitrator shall have discretion to order pre-hearing exchange of
information, including but not limited to, the production of requested documents
and the exchange of summaries of testimony of proposed witnesses.
(b) The deposition of the Claimant(s) and Respondent(s) shall be allowed as a
matter of right. One set of interrogatories approved by the Arbitrator shall be
allowed. There shall be an early and prompt designation and exchange of the
names and addresses of expert witnesses who may be called to testify at the
arbitration hearing. Their depositions and all others shall be allowed upon a
showing of good cause.
8. MOTIONS
In keeping with the intent of the parties in entering into an arbitration
agreement for the rapid and economic resolution of their disputes, all pre-
arbitration motions not designed to expedite the resolution of the dispute are
discouraged. Counsel are urged to seek the informal advice and assistance of the
Arbitrator to resolve interim disputes.
At the pre-hearing conference or other appropriate time, the Arbitrator may
establish notice requirements and other rules as may be appropriate for the
hearing of motions including presentation of issues by telephone or letter as
opposed to formal pleadings.
9. APPLICABLE LAW
Unless otherwise provided, the Arbitrator shall follow the substantive law
and the rules of evidence for the trial of civil actions of the State of Texas.
10. DATE, TIME & PLACE OF HEARING
The Arbitrator shall set the date, time, and place for each hearing and
shall mail to each party notice thereof at least thirty (30) days in advance,
unless the parties by mutual agreement waive such notice or modify the terms
thereof. The arbitration hearing shall take place no sooner than thirty (30)
days nor later than one year from the date of the initial prehearing conference
unless agreed to by the parties or ordered by the Arbitrator.
11. STENOGRAPHIC RECORD
A stenographic record shall be made of the hearing. The cost of such record
shall be shared equally by the parties participating in such hearing. Copies of
the stenographic record shall be provided to the Arbitrator and all of the
parties. In addition, the Arbitrator shall cause all pleadings filed by the
parties to be included with the stenographic record.
Exhibit "B" Page 3
The pleadings and the stenographic record of the hearing shall constitute the
official record of the proceedings.
12. ARBITRATION IN THE ABSENCE OF A PARTY OR REPRESENTATIVE
The arbitration may proceed in the absence of any party or representative
who, after due notice, fails to appear. However, an award shall not be made
solely on the default of a party, and the Arbitrator shall require the appearing
party who is present to submit such evidence as necessary for the making of an
award.
13. WAIVER OF RULES
Any party who proceeds with the arbitration after knowledge that any
provision or requirement of these rules has not been complied with and who fails
to state an objection thereto in writing shall be deemed to have waived the
right to object.
14. SERVING NOTICE
Each party shall be deemed to have consented that any papers, notices, or
process necessary or proper i) for the initiation or continuation of any
arbitration under these rules; ii) for any court action in connection therewith;
or iii) for the entry of judgment on any award made under these rules, may be
served on a party by certified or registered mail, addressed to the party or its
representative at the last known address, or by personal service provided that
reasonable opportunity to be heard with regard thereto has been granted to the
party.
15. TIME AND FORM OF AWARD
The award shall be made promptly by the Arbitrator and, unless otherwise
agreed by the parties or specified by law, no later than thirty (30) days from
the close of the hearing. The award shall be in writing and signed by the
Arbitrator. If requested to do so by any of the parties at the time the matter
is submitted for decision, the Arbitrator shall include a statement of his
findings of fact and conclusions of law on a particular point or reasons for the
award.
16. APPLICATION TO COURT AND EXCLUSION OF LIABILITY
(a) No judicial proceeding by a party relating to the subject matter of the
arbitration shall be deemed a waiver of the party's right to arbitrate.
(b) Neither the Arbitration Service nor any Arbitrator in a proceeding under
these rules is a necessary party in judicial proceedings relating to the
arbitration.
(c) Parties to these rules shall be deemed to have consented that judgment upon
the arbitration award may be entered in any federal or state court having
jurisdiction thereof.
Exhibit "B" Page 4
(d) Notwithstanding anything to the contrary herein, any party may seek in any
federal or state court having jurisdiction thereof to conform, modify, correct,
reject, reverse or accept in whole or in part, the award of the Arbitrator as
the court may deem necessary and proper in the particular circumstances of the
case. The award of the Arbitrator shall be subject generally to the same
standards of review as that accorded under the Texas General Arbitration Act.
Xxxxxx'x Xxx Civ. St. Article 224 et seq. The Court shall not be limited in its
deliberation and review to the grounds set forth in the Texas General
Arbitration Act. Any arbitration award shall be subject to appeal only like a
final judgment entered in a trial court in the State of Texas, and the
arbitration award may be upheld, modified or vacated as though it were a final
judgment from a trial court.
17. COSTS
Each party shall be responsible for its own costs and witness fees incurred
in any arbitration. The costs of the Arbitration Service and the Arbitrator
shall be shared equally by the parties.
18. CONFIDENTIALITY
The entire record of the proceedings shall be kept strictly confidential by
the parties. No party shall disclose, or allow to be disclosed, any of the
information that my be elicited in the course of discovery unless and until a
judgment on the Arbitrators award is sought in any federal or state court having
jurisdiction Provided, however, if any request is received.from a governmental
agency or by subpoena to disclose any of the information which has been deemed
to be confidential, the request shall be relayed to the other parties to this
agreement. If any party to this agreement wishes not to have the information
disclosed to said third party, then the party not wishing to have such
information disclosed shall, at its sole cost and expense, take such actions as
it deems advisable to permit the party from whom the information is requested
not to be required to disclose the requested information. The party desiring not
to have such information disclosed shall indemnify the other party from whom the
information is sought against any liability which it might incur as a result of
its nondisclosure of the information. Any information required to be disclosed
as a result of a nonappealable court order may be disclosed.
19. INJUNCTIVE RELIEF
The Arbitrator shall not have the power to grant any injunctive relief against
any of the parties.
Exhibit "B" Page 5
