Attached files
Exhibit
10.1
PURCHASE
AND SALE AGREEMENT
AMONG
COWTOWN
PIPELINE L.P.
AS
SELLER
AND
QUICKSILVER
GAS SERVICES LP
AND
COWTOWN
PIPELINE PARTNERS L.P.
AS
PURCHASERS
Executed
on December 10, 2009
TABLE OF CONTENTS
Page | ||
ARTICLE
1
|
PURCHASE
AND SALE
|
1
|
Section
1.1
|
Purchase
and Sale
|
1
|
Section
1.2
|
Assets
|
1
|
Section
1.3
|
Excluded
Assets
|
2
|
Section
1.4
|
Effective
Time; Proration of Costs and Revenues
|
3
|
Section
1.5
|
Delivery
and Maintenance of Records
|
4
|
ARTICLE
2
|
PURCHASE
PRICE
|
5
|
Section
2.1
|
Purchase
Price
|
5
|
Section
2.2
|
Adjustments
to Purchase Price
|
5
|
ARTICLE
3
|
TITLE
MATTERS
|
5
|
Section
3.1
|
Seller’s
Title
|
5
|
Section
3.2
|
Casualty
or Condemnation Loss
|
6
|
ARTICLE
4
|
NORM,
WASTES AND OTHER SUBSTANCES
|
6
|
ARTICLE
5
|
REPRESENTATIONS
AND WARRANTIES OF SELLER
|
7
|
Section
5.1
|
Generally
|
7
|
Section
5.2
|
Existence
and Qualification
|
7
|
Section
5.3
|
Power
|
7
|
Section
5.4
|
Authorization
and Enforceability
|
7
|
Section
5.5
|
No
Conflicts
|
8
|
Section
5.6
|
Liability
for Brokers’ Fees
|
8
|
Section
5.7
|
Litigation
|
8
|
Section
5.8
|
Taxes
and Assessments
|
8
|
Section
5.9
|
Compliance
with Laws
|
9
|
Section
5.10
|
Material
Contracts
|
9
|
Section
5.11
|
Governmental
Authorizations
|
10
|
Section
5.12
|
Preference
Rights and Transfer Requirements
|
10
|
Section
5.13
|
Outstanding
Capital Commitments
|
10
|
Section
5.14
|
Condemnation
|
10
|
Section
5.15
|
Bankruptcy
|
11
|
Section
5.16
|
NGA
|
11
|
Section
5.17
|
Investment
Company
|
11
|
Section
5.18
|
No
Tax Partnership
|
11
|
Section
5.19
|
Insurance
|
11
|
Section
5.20
|
Environmental
|
11
|
Section
5.21
|
Title
|
12
|
Section
5.22
|
Intellectual
Property
|
12
|
Section
5.23
|
Condition
of Assets
|
12
|
ARTICLE
6
|
REPRESENTATIONS
AND WARRANTIES OF PURCHASERS
|
12
|
Section
6.1
|
Existence
and Qualification
|
12
|
Section
6.2
|
Power
|
12
|
Section
6.3
|
Authorization
and Enforceability
|
13
|
Section
6.4
|
No
Conflicts
|
13
|
Section
6.5
|
Liability
for Brokers’ Fees
|
13
|
Section
6.6
|
Litigation
|
13
|
Section
6.7
|
Limitation
|
13
|
Section
6.8
|
Bankruptcy
|
14
|
ARTICLE
7
|
COVENANTS
OF THE PARTIES
|
14
|
Section
7.1
|
Access
|
14
|
Section
7.2
|
Government
Reviews
|
14
|
Section
7.3
|
Notification
of Breaches
|
14
|
Section
7.4
|
Assignments;
Operatorship
|
15
|
Section
7.5
|
Public
Announcements
|
16
|
Section
7.6
|
Operation
of Business
|
16
|
Section
7.7
|
Transfer
Requirements
|
16
|
Section
7.8
|
Tax
Matters
|
17
|
Section
7.9
|
Further
Assurances
|
18
|
Section
7.10
|
Eni
GGA
|
18
|
Section
7.11
|
Rights-of-Way
Amendments
|
18
|
ARTICLE
8
|
CONDITIONS
TO CLOSING
|
19
|
Section
8.1
|
Conditions
of Seller to Closing
|
19
|
Section
8.2
|
Conditions
of Purchasers to Closing
|
19
|
ARTICLE
9
|
CLOSING
|
20
|
Section
9.1
|
Time
and Place of Closing
|
20
|
Section
9.2
|
Obligations
of Seller at Closing
|
20
|
Section
9.3
|
Obligations
of Purchasers at Closing
|
21
|
Section
9.4
|
Closing
Payment & Post-Closing Purchase Price Adjustments
|
21
|
ARTICLE
10
|
TERMINATION
|
22
|
Section
10.1
|
Termination
|
22
|
Section
10.2
|
Effect
of Termination
|
23
|
ARTICLE
11
|
POST-CLOSING
OBLIGATIONS; INDEMNIFICATION; LIMITATIONS; DISCLAIMERS AND
WAIVERS
|
24
|
Section
11.1
|
Receipts
|
24
|
Section
11.2
|
Expenses
|
24
|
Section
11.3
|
Assumed
Seller Obligations
|
24
|
Section
11.4
|
Indemnities
|
25
|
Section
11.5
|
Indemnification
Actions
|
27
|
Section
11.6
|
Release
|
28
|
Section
11.7
|
Limitation
on Actions
|
28
|
Section
11.8
|
Disclaimers
|
29
|
Section
11.9
|
Waiver
of Trade Practices Acts
|
30
|
Section
11.10
|
Recording
|
31
|
ARTICLE
12
|
MISCELLANEOUS
|
31
|
Section
12.1
|
Counterparts
|
31
|
Section
12.2
|
Notice
|
31
|
Section
12.3
|
Sales
or Use Tax Recording Fees and Similar Taxes and Fees
|
32
|
Section
12.4
|
Expenses
|
32
|
Section
12.5
|
Change
of Name
|
33
|
Section
12.6
|
Replacement
of Bonds, Letters of Credit and Guarantees
|
33
|
Section
12.7
|
Governing
Law and Venue
|
33
|
Section
12.8
|
Captions
|
33
|
Section
12.9
|
Waivers
|
33
|
Section
12.10
|
Assignment
|
33
|
Section
12.11
|
Entire
Agreement
|
34
|
Section
12.12
|
Amendment
|
34
|
Section
12.13
|
No
Third-Party Beneficiaries
|
34
|
Section
12.14
|
References
|
34
|
Section
12.15
|
Construction
|
34
|
Section
12.16
|
Limitation
on Damages
|
35
|
Section
12.17
|
Conspicuousness
|
35
|
Section
12.18
|
Severability
|
35
|
Section
12.19
|
Time
of Essence
|
35
|
Section
12.20
|
Certain
Actions by Purchasers
|
35
|
EXHIBITS
Exhibit
A
|
System
|
Exhibit
B
|
Conveyance
|
Exhibit
C
|
Lease
Agreement
|
Exhibit
D
|
Parent
Guaranty
|
SCHEDULES
Schedule
1.2(b)
|
Contracts
|
Schedule
1.2(c)
|
Surface
Contracts
|
Schedule
1.2(e)
|
Pipelines
|
Schedule
1.3(e)
|
Excluded
Items
|
Schedule
1.3(j)
|
Excluded
Rights-of-Way
|
Schedule
5.5
|
Seller’s
Conflicts
|
Schedule
5.7
|
Litigation
|
Schedule
5.8
|
Taxes
and Assessments
|
Schedule
5.9
|
Compliance
with Laws
|
Schedule
5.10(a)
|
Material
Contracts
|
Schedule
5.10(b)
|
Contract
Matters
|
Schedule 5.11 | Governmental Authorization Matters |
Schedule
5.12
|
Preference
Rights and Transfer Requirements
|
Schedule
5.13
|
Outstanding
Capital Commitments
|
Schedule
5.19
|
Insurance
|
Schedule
5.20
|
Environmental
Matters
|
Schedule
5.21(b)
|
Title
Matters
|
Schedule
6.4(b)
|
Purchasers’
Conflicts
|
Schedule
7.6
|
Operation
of Business
|
Schedule
9.3(a)
|
Seller’s
Account Information
|
DEFINITIONS
“actual
knowledge” has the meaning set forth in Section 5.1(a).
“Adjusted
Purchase Price” shall mean the Purchase Price after calculating and applying the
adjustments set forth in Section 2.2.
“Adjustment
Period” has the meaning set forth in Section 2.2(a).
“Adverse
Environmental Condition” means any contamination or condition exceeding
regulatory limits and not otherwise authorized by permit or Law, resulting from
any discharge, release, production, storage, treatment, seepage, escape,
leakage, emission, emptying, leaching or any other activities on, in or from any
Asset, or the migration or transportation from other lands to any Asset, of any
Hazardous Materials that require Remediation pursuant to any Laws, including,
but not limited to, Environmental Laws, or that require Remediation under the
terms of any of the Surface Contracts.
“AFE”
means authority for expenditure.
“Affiliates”
with respect to any Person, means any person that directly or indirectly
controls, is controlled by or is under common control with such Person;
provided, that for purposes of this Agreement, (i) Quicksilver and
its subsidiaries, including Seller (other than Purchasers and their respective
subsidiaries) shall not be deemed to be Affiliates of Purchasers and their
respective subsidiaries and (ii) Purchasers and their respective subsidiaries
shall not be deemed to be Affiliates of Quicksilver and its subsidiaries,
including Seller (other than Purchasers and their respective
subsidiaries).
“Agreed
Interest Rate” means simple interest calculated at the rate of four percent (4%)
per annum.
“Agreement”
means this Purchase and Sale Agreement.
“Assets”
has the meaning set forth in Section 1.2.
“Assumed
Seller Obligations” has the meaning set forth in Section 11.3.
“Business
Day” means each calendar day except Saturdays, Sundays, and Federal
holidays.
“Claim”
or “Claims” has the meaning set forth in Section 11.4(a).
“Claim
Notice” has the meaning set forth in Section 11.5(b).
“Closing”
has the meaning set forth in Section 9.1(a).
“Closing
Date” has the meaning set forth in Section 9.1(b).
“Closing
Payment” has the meaning set forth in Section 9.4(a).
“Code”
has the meaning set forth in Section 7.8(b).
“Conflicts
Committee” means the conflicts committee of the board of directors of
Quicksilver Gas Services GP LLC, the general partner of KGS.
“Contracts”
has the meaning set forth in Section 1.2(b).
“Conveyance”
has the meaning set forth in Section 3.1(b).
“CoServ”
means Denton County Electric Cooperative, Inc.
“CoServ
Reimbursement” means any reimbursement paid by CoServ pursuant to the contract
described in item 1 of Schedule
1.2(b) on account of construction aid paid to CoServ pursuant
thereto.
“Cowtown”
has the meaning set forth in the preamble to this Agreement.
“Defensible
Title” means that title of Seller with respect to the Real Property Interests,
except for and subject to Permitted Encumbrances, is free and clear of liens,
encumbrances, obligations, security interests, irregularities, pledges, or other
defects.
“DTPA”
has the meaning set forth in Section 11.9.
“Effective
Time” has the meaning set forth in Section 1.4(a).
“Eni”
means Eni Petroleum US LLC.
“Eni GGA”
means that certain Gas Gathering Agreement dated effective April 1, 2009, by and
between Seller, as “Gatherer,” and Eni, as “Producer.”
“Environmental
Laws” means, as the same may have been amended, the Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; the Resource
Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.; the Federal
Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Clean
Air Act, 42 U.S.C. § 7401 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. § 1471 et seq.; the Toxic
Substances Control Act, 15 U.S.C. §§ 2601 through 2629; the Oil Pollution Act,
33 U.S.C. § 2701 et
seq.; the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. §
11001 et seq.;
the Safe Drinking Water Act, 42 U.S.C. §§ 300f through 300j; the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136 et seq.; the
Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; the Atomic
Energy Act, 42 U.S.C. § 2011 et seq.; and all
applicable related law, whether local, state, territorial, or national, of any
Governmental Body having jurisdiction over the property in question addressing
pollution or protection of human health, safety, natural resources or the
environment and all regulations implementing the foregoing.
“Environmental
Liabilities” shall mean any and all environmental response costs (including
costs of remediation), damages, natural resource damages, settlements,
consulting fees, expenses, penalties, fines, orphan share, prejudgment and
post-judgment interest, court costs, attorneys’ fees and other liabilities
incurred or imposed (i) pursuant to any order, notice of responsibility,
directive (including requirements embodied in Environmental Laws), injunction,
judgment or similar act (including settlements) by any Governmental Body or
court of competent jurisdiction to the extent arising out of any violation of,
or remedial obligation under, any Environmental Laws which are attributable to
the ownership or operation of the Assets prior to the Effective Time or (ii)
pursuant to any claim or cause of action by a Governmental Body or other Person
for personal injury, property damage, damage to natural resources, remediation
or response costs to the extent arising out of any violation of, or any
remediation obligation under, any Environmental
Laws which is attributable to the ownership or operation of the Assets prior to
the Effective Time.
“Equipment”
has the meaning set forth in Section 1.2(d).
“ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.
“Excluded
Assets” has the meaning set forth in Section 1.3.
"Excluded
Rights-of-Way" has the meaning set forth in Section 1.3(j)
“Facility”
means that certain treating facility located on that certain 69.03 acre tract of
land more specifically described in the instrument set forth in item A1 of Schedule 1.2(c), together with
all compressors, dehydration and amine units, tanks, machinery and equipment
appurtenant and relating exclusively to such treating facility.
“GAAP”
means United States generally accepted accounting principals consistently
applied.
“Governmental
Authorizations” has the meaning set forth in Section 5.11.
“Governmental
Body” or “Governmental Bodies” means any federal, state, local, municipal or
other governments; any governmental, regulatory or administrative agency,
commission, body or other authority exercising or entitled to exercise any
administrative, executive, judicial, legislative, police, regulatory or taxing
authority or power; and any court or governmental tribunal.
“Hazardous
Materials” means wastes, pollutants, contaminants, hazardous materials,
hazardous wastes and any other materials or substances subject to regulation
relating to the protection of the environment, human health or worker
safety.
“HSR Act”
means the Hart-Scott Rodino Antitrust Improvements Act of 1976.
“Hydrocarbons”
means oil, gas, condensate and other gaseous and liquid hydrocarbons or any
combination thereof and sulphur extracted from hydrocarbons.
“Indemnified
Party” has the meaning set forth in Section 11.5(a).
“Indemnifying
Party” has the meaning set forth in Section 11.5(a).
“Indemnity
Claim” has the meaning set forth in Section 11.5(b).
“KGS” has
the meaning set forth in the preamble to this Agreement.
“Laws”
means all statutes, laws, rules, regulations, ordinances, orders, judgments,
decrees and codes of Governmental Bodies.
"Lease
Agreement" means a lease agreement covering the Excluded Rights-of-Way and any
Retained Assets substantially in the form of the Lease Agreement attached hereto
as Exhibit
C.
“Material Adverse Effect” means any effect that, when taken
together with all other effects, is reasonably expected to have a material and
adverse effect on the value of the Assets, taken as a whole, and as currently
operated, in excess of $6,000,000; provided, however, that “Material Adverse
Effect” shall not include (i) any effect resulting from entering into this
Agreement or the announcement of the transactions contemplated by this
Agreement, unless and to the extent that entering into this Agreement results in
the breach of a Material Contract; (ii) any effect resulting from changes in
general market, economic, financial or political conditions or any outbreak of
hostilities or war, (iii) any effect that affects the Hydrocarbon exploration,
production, development, processing, gathering and/or transportation industry
generally (including changes in commodity prices or general market prices in the
Hydrocarbon exploration, production, development, processing, gathering and/or
transportation industry generally), and (iv) any effect resulting from a change
in Laws.
"Material
Contracts" has the meaning set forth in Section 5.10(a).
“MMBtu”
has the meaning set forth in the Eni GGA.
“NORM”
means naturally occurring radioactive material.
“Option
Agreement” means the Option, Right of First Refusal, and Waiver in Amendment to
the Omnibus Agreement and Gas Gathering and Processing Agreement, dated as of
June 9, 2009. among Quicksilver, KGS, Cowtown Gas Processing Partners L.P.,
Quicksilver Gas Services GP LLC, and Cowtown.
“Parent
Guaranty” has the meaning set forth in the recitals of this
Agreement.
“Permitted
Encumbrances” means any or all of the following:
(a) Third
party consent requirements and similar restrictions;
(b) Liens
for current Taxes or assessments not yet delinquent or, if delinquent, being
contested in good faith by appropriate actions;
(c) Materialman’s,
mechanic’s, repairman’s, employee’s, contractor’s, operator’s and other similar
liens or charges arising in the ordinary course of business for amounts not yet
delinquent (including any amounts being withheld as provided by Law), or if
delinquent, being contested in good faith by appropriate actions;
(d) All
rights to consent by, required notices to, filings with, or other actions by
Governmental Bodies in connection with the sale or conveyance of the Assets or
interests therein if they are not required or customarily obtained prior to the
sale or conveyance;
(e) Rights
of reassignment arising upon final intention to abandon or release the Assets,
or any of them;
(f) Easements,
rights-of-way, servitudes, permits, surface leases and other rights in respect
of surface operations except to the extent the same would materially interfere
or would be reasonably likely to materially interfere with the operation of the
Assets;
(g) All
rights reserved to or vested in any Governmental Body to control or regulate any
of the Assets in any manner and all obligations and duties under all applicable
laws, rules and orders of any such Governmental Body or under any franchise,
grant, license or permit issued by any such Governmental Body;
(h) Any
encumbrance on or affecting the Assets which is discharged by Seller at or prior
to Closing;
(i) Any
other liens, charges, encumbrances, defects or irregularities which do not,
individually or in the aggregate, materially interfere with the use or ownership
of the Assets subject thereto or affected thereby (as currently used or owned),
and which would be accepted by a reasonably prudent purchaser engaged in the
business of owning and operating oil or gas gathering pipelines;
(j) Defects
arising out of lack of corporate or other entity authorization unless such
defect results in another party’s actual and superior claim of title to the
relevant Real Property Interest;
(k) Defects
based solely on (i) the fact that title is not substantiated by information in
Seller’s files, or (ii) references to a document(s) if such referenced
document(s) do not constitute a defect;
(l) Defects
that have been cured by applicable Laws of limitations or prescription;
and
(m) Defects
specifically disclosed in Schedule 5.21(b).
“Person”
means any individual, firm, corporation, partnership, limited liability company,
joint venture, association, trust, unincorporated organization, Governmental
Body or any other entity.
“Pipelines”
has the meaning set forth in Section 1.2(e).
“Preference
Right” means any right or agreement that enables any Person to purchase or
acquire any Asset or any interest therein or portion thereof as a result of or
in connection with (i) the sale, assignment or other transfer of any Asset or
any interest therein or portion thereof or (ii) the execution or delivery of
this Agreement or the consummation or performance of the terms and conditions
contemplated by this Agreement.
“Property
Costs” has the meaning set forth in Section 1.4(b).
“Purchase
Price” has the meaning set forth in Section 2.1.
“Purchasers”
has the meaning set forth in the preamble to this Agreement.
“Purchaser
Indemnitees” shall mean Purchasers, Purchasers’ Affiliates and Purchasers’
contractors and each of their respective officers, directors, employees, agents,
representatives, insurers, subcontractors, successors and permitted
assigns.
"QRI GGA"
shall mean that certain Gas Gathering Agreement dated effective as of December
1, 2009, by and between Seller, as "Gatherer", and Quicksilver, as
"Producer".
“Quicksilver”
means Quicksilver Resources Inc., a Delaware corporation and the indirect parent
of Seller.
“Records”
has the meaning set forth in Section 1.2(g).
“REGARDLESS
OF FAULT” has the meaning set forth in Section
11.4(a).
“Real Property Interest” shall mean the easements, rights-of-way,
surface leases and fee interests in real property identified on Schedule 1.2(c).
“Remediation”
or “Remedial Action” means the removal, abatement, response, investigative,
cleanup and/or monitoring activities undertaken to address any Adverse
Environmental Conditions, or a release of Hazardous Materials, any
investigation, study, assessment, testing, monitoring, containment, removal,
disposal, closure, corrective action, passive remediation, natural attenuation
or bioremediation, and the installation and operation of remediation
systems.
“Retained
Asset” has the meaning set forth in Section 7.7(c).
“Retained
Employee Liabilities” shall mean, collectively, any liabilities of Seller (i) to
employees of Seller arising under the Worker Adjustment Retraining Notification
Act of 1988 as a result of actions taken by Seller prior to the Closing, (ii)
arising out of claims by employees of Seller with respect to events that occur
prior to the Closing and that relate to their employment with, or the
termination of their employment from, Seller, (iii) with respect to employees of
Seller arising under any “employee benefit plan” (as defined in Section 3(3) of
ERISA) that is sponsored by, contributed to, or maintained by, Seller, or (iv)
arising under ERISA for which Purchasers may have any liability under ERISA
solely as a result of the consummation of the transaction contemplated by this
Agreement.
“Retained
Material Contract” has the meaning set forth in Section 7.7(b).
“Retained
Seller Obligations” has the meaning set forth in Section 11.3.
“Seller”
has the meaning set forth in the preamble to this Agreement.
“Seller
Indemnitees” shall mean Seller, Seller’s Affiliates and Seller’s contractors,
and each of their respective officers, directors, employees, agents,
representatives, insurers, subcontractors, successors and permitted
assigns.
“Surface
Contracts” has the meaning set forth in Section 1.2(c).
“System”
means the portion of the natural gas gathering system that is depicted
in green on the map attached as Exhibit A together with all
appurtenances thereto. Notwithstanding anything herein contained to
the contrary, the System shall not include any pipelines, equipment or other
properties that are located upstream of the inlet flange of the meters where
Hydrocarbons are delivered into the pipelines consisting of such natural gas
gathering system.
“Taxes”
means all federal, state, local and foreign income, profits, franchise, sales,
use, ad valorem, property, severance, production, excise, stamp, documentary,
real property transfer or gain, gross receipts, goods and services,
registration, capital, transfer or withholding taxes or other governmental fees
or charges imposed by any taxing authority, including any interest, penalties or
additional amounts which may be imposed with respect thereto.
“Tax
Returns” has the meaning set forth in Section 5.8.
“Termination
Date” has the meaning set forth in Section 10.1(b).
“Transfer
Requirement” means any consent, approval, authorization or permit of, or filing
with or notification to, any Person which is required to be obtained, made or
complied with for or in connection
with any sale, assignment or transfer of any Asset or any interest therein,
other than any consent of, notice to, filing with or other action by
Governmental Bodies in connection with the sale or conveyance of Surface
Contracts or interests therein if such consent, notice, filing or action is not
required prior to the assignment of such Surface Contracts or interests or is
customarily obtained subsequent to the sale or conveyance (including consents
from state agencies).
PURCHASE AND SALE
AGREEMENT
This
Agreement is executed on December 10, 2009, by and among COWTOWN PIPELINE L.P.,
a Texas limited partnership (“Seller”), and QUICKSILVER GAS SERVICES LP, a
Delaware limited partnership (“KGS”), and COWTOWN PIPELINE PARTNERS L.P., a
Texas limited partnership (“Cowtown”; KGS and Cowtown are hereinafter referred
to together as “Purchasers”).
RECITALS
A. Seller
owns various natural gas gathering pipeline and related properties located in
the Alliance Airport area of Tarrant and Denton Counties in the State of Texas,
as more fully described in the exhibits hereto.
B. Seller
desires to sell to Purchasers and Purchasers desire to purchase from Seller the
properties and rights of Seller hereafter described, in the manner and upon the
terms and conditions hereafter set forth.
C. Quicksilver
has entered into a Guaranty Agreement (“Parent Guaranty”) in the form attached
as Exhibit D in favor of
Purchasers, pursuant to which, among other things, Quicksilver has guaranteed
the payment and performance by Seller of all of its liabilities and obligations
under this Agreement.
D. Capitalized
terms used herein shall have the meanings ascribed to them in this Agreement as
such terms are identified and/or defined in the preceding Definitions section
hereof.
NOW,
THEREFORE, in consideration of the premises and of the mutual promises,
representations, warranties, covenants, conditions and agreements contained
herein, and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto, intending to be legally bound
by the terms hereof, agree as follows:
ARTICLE
1
PURCHASE
AND SALE
|
Section
1.1
|
Purchase and
Sale.
|
At the
Closing, and upon the terms and subject to the conditions of this Agreement,
Seller agrees to sell, transfer and convey the Assets to Purchasers and
Purchasers agree to purchase, accept and pay for the Assets and to assume the
Assumed Seller Obligations attributable to the Assets.
|
Section
1.2
|
Assets.
|
As used
herein, the term “Assets” means, subject to the terms and conditions of this
Agreement, all of Seller’s right, title, interest and estate, real or personal,
in and to the following (but excluding the Excluded Assets):
(a) The
System;
(b) All
contracts, agreements and instruments by which the other Assets are bound, or
that relate to or are otherwise applicable to the other Assets, including those
identified on Schedule
1.2(b) (hereinafter collectively referred to as “Contracts”), but
excluding any such contracts, agreements and instruments to the extent transfer
is restricted by third party agreement or applicable Law and the necessary
consents to transfer are not obtained pursuant to Section 7.7 and provided that
“Contracts” shall not include the instruments constituting the Surface
Contracts;
(c) All
easements, permits, licenses, servitudes, rights-of-way, surface leases, fee
interests in real property and other surface rights appurtenant to, and used or
held for use primarily in connection with the System (including those identified
on Schedule 1.2(c))
(“Surface Contracts”), but excluding any such easements, permits, licenses,
servitudes, rights-of-way, surface leases, fee interests in real property and
other such rights to the extent transfer is restricted by third party agreement
or applicable Law and necessary consents to transfer are not obtained pursuant
to Section 7.7 and which
will be added to the properties that are subject to and bound by the Lease
Agreement;
(d) All
equipment, machinery, fixtures and other tangible personal property and
improvements located on or constituting a part of the System and used or held
for use primarily in connection with the operation of the System ("Equipment"),
and that certain 2001 Ford F250, vehicle identification number
1FTNX20L31EA87453;
(e) All
flow lines, pipelines, gathering systems, meters and appurtenances thereto
constituting a part of the System or used, or held for use, primarily in
connection with the operation of the System, including those identified on Schedule 1.2(e)
(“Pipelines”);
(f) The
Facility; and
(g) All
land files; gas contract files; gas gathering and processing files; abstracts;
title opinions; land surveys; maps; engineering data and reports; reserve or
volume data provided by any third party in connection with the negotiation of
any gas gathering agreement that constitutes a Material Contract; other books,
records, data, files and accounting records, in each case to the extent related
primarily to the Assets, or used or held for use primarily in connection with
the maintenance or operation thereof; and all computer or communications
software used in connection with monitoring and running the Facility, but
excluding (i) any books, records, data, files, maps and accounting records to
the extent disclosure or transfer is restricted by third party agreement or
applicable Law and the necessary consents to transfer are not obtained pursuant
to Section 7.7, (ii)
computer or communications software that is not used in connection with
monitoring and running the Facility or intellectual property (including tapes,
codes, data and program documentation and all manifestations and technical
information relating thereto), (iii) attorney-client privileged communications
and work product of Seller’s legal counsel (other than title opinions), (iv)
except to the extent constituting reserve or volume data described above in this
Section 1.2(g), reserve
studies and evaluations, and (v) records relating to the negotiation and
consummation of the sale of the Assets (subject to such exclusions, the
“Records”).
|
Section
1.3
|
Excluded
Assets.
|
Notwithstanding
the foregoing, the Assets shall not include, and there is excepted, reserved and
excluded from the purchase and sale contemplated hereby (collectively, the
“Excluded Assets”):
2
(a) all
corporate, financial, income and franchise tax and legal records of Seller that
relate to Seller’s business generally (whether or not relating to the Assets),
and all books, records and files that relate to the Excluded Assets and those
records retained by Seller pursuant to Section 1.2(g) and copies of
any other Records retained by Seller pursuant to Section 1.5;
(b) except
to the extent expressly constituting a portion of the Records, all geological
and geophysical data (including all seismic data, including reprocessed data)
and all logs, interpretive data, technical evaluations, technical outputs,
reserve estimates and economic estimates;
(c) other
than any CoServ Reimbursement, all rights to any refund of Taxes or other costs
or expenses borne by Seller or Seller’s predecessors in interest and title
attributable to periods prior to the Effective Time;
(d) Seller’s
area-wide bonds, permits and licenses or other permits, licenses or
authorizations used in the conduct of Seller’s business generally;
(e) those
items listed in Schedule
1.3(e);
(f) all
trade credits, account receivables, note receivables, and other receivables
attributable to the Assets with respect to any period of time prior to the
Effective Time;
(g) except
to the extent expressly described in Section 1.2(d), all right,
title and interest of Seller in and to vehicles used primarily in connection
with the Assets;
(h) all
rights, titles, claims and interests of Seller or any Affiliate of Seller (i) to
or under any policy or agreement of insurance or any insurance proceeds to the
extent attributable to the period prior to the Effective Time, and (ii) to or
under any bond or bond proceeds;
(i) any
patent, patent application, logo, service mark, copyright, trade name or
trademark of or associated with Seller or any Affiliate of Seller or any
business of Seller or of any Affiliate of Seller;
(j) all
easements and rights-of-way listed in Schedule 1.3(j), together
with all flow lines, pipelines, equipment, machinery, fixtures and other
tangible personal property and improvements located thereon or related thereto
(collectively, the "Excluded Rights-of-Way"); and
(k) any
pipelines, equipment or other properties that are located upstream of the inlet
flange of the meters where Hydrocarbons are delivered into the
Pipelines.
|
Section
1.4
|
Effective Time;
Proration of Costs and
Revenues.
|
(a) Subject
to Section 1.5,
possession of the Assets shall be transferred from Seller to Purchasers at the
Closing, but certain financial benefits and burdens of the Assets shall be
transferred effective as of 7:00 A.M., Central Standard Time, on December 1,
2009 (the “Effective Time”), as described below.
3
(b) Purchasers
shall be entitled to all income, proceeds, receipts and credits earned with
respect to the Assets at or after the Effective Time, and shall be responsible
for (and entitled to any refunds with respect to) all Property Costs
attributable to periods from and after the Effective Time. Seller shall be
entitled to all income, proceeds, receipts and credits earned with respect to
the Assets prior to the Effective Time, and shall be responsible for (and
entitled to any refunds with respect to) all Property Costs attributable to
periods prior to the Effective Time. “Earned” and “attributable to,” as used in
this Agreement, shall be interpreted in accordance with GAAP. “Property Costs”
means all costs attributable to the ownership and operation of the Assets
(including, without limitation, costs of insurance and ad valorem, property, and
similar Taxes based upon or measured by the ownership or operation of the
Assets, but excluding any other Taxes) and obligations to make payments that
arise under a contract or agreement related to the Assets and capital
expenditures incurred in the ownership and operation of the Assets in the
ordinary course of business, but excluding, without limitation, liabilities,
losses, costs and expenses attributable to (i) Claims for personal injury or
death, property damage or violation of any Law, (ii) obligations to dismantle,
abandon and salvage facilities, and (iii) obligations to remediate any
contamination of groundwater, surface water, soil, Equipment or Pipelines under
applicable Environmental Laws, all of which are addressed in Article 11. For purposes of
this Section 1.4,
determination of whether Property Costs are attributable to the period before or
after the Effective Time shall be based on when services are rendered, when the
goods are delivered or when the work is performed. For clarification,
the date an item or work is ordered is not the date of a pre-Effective Time
transaction for settlement purposes, but rather the date on which the item
ordered is delivered to the job site, or the date on which the work ordered is
performed, shall be the relevant date. Seller shall provide to
Purchasers, no later than three (3) Business Days prior to Closing, all data
necessary to support any estimated allocation for purposes of establishing the
adjustment to the Purchase Price pursuant to Section 2.2 hereof that will
be used to determine the Closing Payment. Taxes, right-of-way fees,
insurance premiums and other Property Costs that are paid periodically shall be
prorated based on the number of days in the applicable period falling before and
the number of days in the applicable period falling at or after the Effective
Time. In each case, Purchasers shall be responsible for the portion allocated to
the period at and after the Effective Time and Seller shall be responsible for
the portion allocated to the period before the Effective Time.
|
Section
1.5
|
Delivery and
Maintenance of Records.
|
(a) Seller,
at Seller’s sole cost and expense, shall deliver the Records to Purchasers
within thirty (30) days following Closing. Seller may retain copies
of any Records.
(b) Purchasers,
for a period of seven (7) years following Closing, will (i) retain the Records,
(ii) provide Seller, its Affiliates and their respective officers, employees and
representatives with reasonable access to the Records during normal business
hours for review and copying for legitimate business reasons at Seller’s
expense, and (iii) provide Seller, its Affiliates and their respective officers,
employees and representatives with reasonable access, during normal business
hours, to materials received or produced after Closing relating to any Indemnity
Claim made under Section
11.4 of this Agreement for review and copying at Seller’s
expense.
4
ARTICLE
2
PURCHASE
PRICE
|
Section
2.1
|
Purchase
Price.
|
The
purchase price for the Assets (the “Purchase Price”) shall be $87,100,000 adjusted as
provided in Section
2.2.
|
Section
2.2
|
Adjustments to
Purchase Price.
|
The
Purchase Price for the Assets shall be adjusted as follows with all such amounts
being determined in accordance with GAAP:
(a) Reduced
by the aggregate amount of all proceeds earned with respect to the Assets
between the Effective Time and the Closing Date (with the period between the
Effective Time and the Closing Date referred to as the “Adjustment
Period”);
(b) Increased
by the amount of all Property Costs and other costs attributable to the
ownership and operation of the Assets that are attributable to the period from
and after the Effective Time, except any Property Costs and other such costs
already deducted in the determination of proceeds in Section 2.2(a);
and
(c) Increased
or reduced as agreed upon in writing by Seller and Purchasers.
Each
adjustment made pursuant to Section 2.2(a) shall serve to
satisfy, up to the amount of the adjustment, the entitlement of Purchasers under
Section 1.4 to the value
of income, proceeds, receipts and credits earned with respect to the Assets
during the Adjustment Period, and, as such, Purchasers shall not have any
separate rights to receive any income, proceeds, receipts and/or credits with
respect to which an adjustment has been made. Similarly, the adjustment
described in Section
2.2(b) shall serve to satisfy, up to the amount of the adjustment, the
obligation of Purchasers under Section 1.4 to pay Property
Costs and other costs attributable to the ownership and operation of the Assets
that are incurred during the Adjustment Period, and, as such, Purchasers shall
not be separately obligated to pay for any Property Costs or other such costs
with respect to which an adjustment has been made.
ARTICLE
3
TITLE
MATTERS
|
Section
3.1
|
Seller’s
Title.
|
(a) Except
for the representation and warranty set forth in Section 5.21, Seller makes no
representation or warranty, express, implied, statutory or otherwise, with
respect to Seller’s title to any of the Assets.
(b) The
conveyance to be delivered by Seller to Cowtown shall be in the form of Exhibit B hereto (the
“Conveyance”).
(c) Notwithstanding
anything herein provided to the contrary, if a title defect results from any
matter which could also result in the breach of any representation or warranty
of Seller set forth in Article
5 (other than Section 5.21), then
Purchasers shall only be entitled to assert such matter as a breach of the
representation and warranty set forth in Section 5.21 if
5
such
title defect results in a breach of Section 5.21, and shall be
precluded from also asserting such matter as the basis of the breach of any
other representation of warranty set forth in Article 5.
|
Section
3.2
|
Casualty or
Condemnation Loss.
|
(a) Subject
to Section 3.2(b) and
Section 3.2(c),
Purchasers shall assume all risk of loss with respect to, and any change in the
condition of, the Assets from the Effective Time until Closing and the
depreciation of personal property due to ordinary wear and tear.
(b) Subject
to the provisions of Sections
8.1(e) and 8.2(e)
hereof, if, after the date of this Agreement but prior to the Closing Date, any
portion of the Assets is destroyed or damaged by fire or other casualty or is
taken in condemnation or under right of eminent domain, and the loss as a result
of such individual casualty or taking exceeds one percent (1%) of the Purchase
Price, Purchasers shall nevertheless be required to close and Seller shall elect
by written notice to Purchasers prior to Closing either (i) to cause the Assets
affected by any casualty or taking to be repaired or restored to at least their
condition prior to such casualty, at Seller’s sole cost, as promptly as
reasonably practicable (which work may extend after the Closing Date), or (ii)
to indemnify Purchasers through a document reasonably acceptable to Seller and
Purchasers against any costs or expenses that Purchasers reasonably incur to
repair the Assets subject to any casualty or taking. In each case,
notwithstanding anything herein provided to the contrary, Seller shall retain
all rights to insurance and other claims against third parties with respect to
the casualty or taking except to the extent the parties otherwise agree in
writing.
(c) If,
after the date of this Agreement but prior to the Closing Date, any portion of
the Assets is destroyed or damaged by fire or other casualty or is taken in
condemnation or under right of eminent domain, and the loss as a result of such
individual casualty or taking is one percent (1%) or less of the Purchase Price,
Purchasers shall nevertheless be required to close and Seller shall, at Closing,
pay to Purchasers all sums paid to Seller by third parties by reason of such
casualty or taking and shall assign, transfer and set over to Purchasers or
subrogate Purchasers to all of Seller’s right, title and interest (if any) in
insurance claims, unpaid awards and other rights against third parties (other
than Affiliates of Seller and their directors, officers, employees and agents)
arising out of the casualty or taking.
ARTICLE
4
NORM,
WASTES AND OTHER SUBSTANCES
Purchasers
acknowledge that the Assets have been used for the gathering and transportation
of Hydrocarbons and that there may be petroleum, produced water, wastes or other
substances or materials located in, on or under the System or associated with
the Assets. Equipment and sites included in the Assets may contain
asbestos, hazardous substances or NORM. NORM may affix or attach
itself to the inside of pipes, materials, and equipment as scale or in other
forms. The pipes, materials and equipment (including, without
limitation, Equipment) included in the Assets may contain NORM and other wastes
or hazardous substances. NORM-containing material and/or other wastes
or hazardous substances may have come in contact with various environmental
media, including, without limitation, water, soils or
sediment. Special procedures may be required for the assessment,
remediation, removal, transportation or disposal of environmental media, wastes,
asbestos, hazardous substances and NORM from the Assets.
6
ARTICLE
5
REPRESENTATIONS
AND WARRANTIES OF SELLER
|
Section
5.1
|
Generally.
|
(a) Any
representation or warranty qualified “to the knowledge of Seller” or “to
Seller’s knowledge” or with any similar knowledge qualification is limited to
matters within the actual knowledge of any officer of Quicksilver or Seller, and
any employee at a director or higher level of Quicksilver or
Seller. “Actual knowledge” for purposes of this Agreement means
information actually personally known by such persons.
(b) Inclusion
of a matter on a Schedule to a representation or warranty that addresses matters
having a Material Adverse Effect shall not be deemed an indication that such
matter does, or may, have a Material Adverse Effect. Likewise, the inclusion of
a matter on a Schedule in relation to a representation or warranty shall not be
deemed an indication that such matter necessarily would, or may, breach such
representation or warranty absent its inclusion on such Schedule. Matters may be
disclosed on a Schedule to this Agreement for purposes of information
only.
(c) Subject
to the foregoing provisions of this Section 5.1, the disclaimers
and waivers contained in Sections 11.8 and 11.9 and the other terms and
conditions of this Agreement, Seller represents and warrants to Purchasers the
matters set out in Sections
5.2 through 5.23.
|
Section
5.2
|
Existence and
Qualification.
|
Seller is
duly formed, validly existing and in good standing under the laws of the State
of Texas.
|
Section
5.3
|
Power.
|
Seller
has the limited partnership power to execute and deliver, and to incur and
perform all of its obligations under, this Agreement and to consummate the
transactions contemplated by this Agreement.
|
Section
5.4
|
Authorization and
Enforceability.
|
The
execution, delivery and performance of this Agreement, and the performance of
the transactions contemplated hereby, have been duly and validly authorized by
all necessary limited partnership action on the part of Seller. This Agreement
has been, and all documents required hereunder to be executed and delivered by
Seller at Closing will be, duly executed and delivered by Seller, and this
Agreement constitutes, and at the Closing such documents will constitute, the
valid and binding obligations of Seller, enforceable against Seller in
accordance with their terms, except as such enforceability may be limited by
applicable bankruptcy or other similar laws affecting the rights and remedies of
creditors generally as well as to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).
7
|
Section
5.5
|
No
Conflicts.
|
Subject
to compliance with the Transfer Requirements set forth in Schedule 5.12 and as set forth
on Schedule 5.5, the
execution, delivery and performance of this Agreement and the Lease Agreement by
Seller, and the transactions contemplated herein and therein will not (a)
violate any provision of the certificate of formation, limited partnership
agreement or other constituent documents of Seller, (b) result in default (with
due notice or lapse of time or both) or the creation of any lien or encumbrance
or give rise to any right of termination, cancellation or acceleration under any
of the terms, conditions or provisions of any note, bond, mortgage, indenture,
license or agreement to which Seller is a party or that affect the Assets, (c)
violate any judgment, order, ruling, or decree applicable to Seller as a party
in interest, (d) violate any Laws applicable to Seller or any of the Assets,
except for (i) rights to consent by, required notices to, filings with, approval
or authorizations of, or other actions by any Governmental Body where the same
are not required prior to the assignment of the related Asset or are customarily
obtained subsequent to the sale or conveyance thereof and (ii) any matters
described in clauses (b), (c) or (d) above which would not have a Material
Adverse Effect.
|
Section
5.6
|
Liability for Brokers’
Fees.
|
Neither
of Purchasers or any of their respective Affiliates shall directly or indirectly
have any responsibility, liability or expense as a result of undertakings or
agreements of Seller or any of its Affiliates for brokerage fees, finder’s fees,
agent’s commissions or other similar forms of compensation in connection with
this Agreement or any agreement or transaction contemplated hereby.
|
Section
5.7
|
Litigation.
|
Except as
set forth in Schedule
5.7, (a) no proceeding, action, suit for which Seller has received
service of process, or other legal proceeding of any kind or nature before any
Governmental Body or arbitrator is pending or, to Seller’s knowledge,
threatened, that (i) affects the Assets or (ii) would be reasonably likely to
impair Seller’s ability to perform its obligations under this Agreement; and (b)
to Seller’s knowledge, no investigations are currently pending by any
Governmental Body, and no suits have been filed, that directly relate to or
affect the Assets. Except as set forth in Schedule 5.7, no notice in
writing from any Governmental Body or other Person that would have a Material
Adverse Effect has been received by Seller claiming any violation of,
noncompliance with or any liability under any Law with respect to the Assets
(including any Environmental Law).
|
Section
5.8
|
Taxes and
Assessments.
|
With
respect to all Taxes related to the Assets, (a) all reports, returns, statements
(including estimated reports, returns or statements) and other similar filings
(the “Tax Returns”) required to be filed with respect to the Assets have been
timely filed with the appropriate Governmental Body in all jurisdictions in
which such Tax Returns are required to be filed, (b) such Tax Returns are true
and correct in all material respects, and (c) all Taxes with respect to the
Assets have been timely paid, except those being contested in good faith in
connection with the matters set forth on Schedule 5.8.
With
respect to all Taxes related to the Assets, except as set forth on Schedule 5.8, (w) Seller has
not received written notice of any claim from any applicable Governmental Body
for the assessment of any Taxes with respect to the Assets; (x) there is not
currently in effect any
8
extension
or waiver of any statute of limitations of any jurisdiction regarding the
assessment or collection of any such Tax; (y) there are no administrative
proceedings or lawsuits pending against the Assets or Seller by any taxing
authority; and (z) there are no Tax liens on any of the Assets except for liens
for Taxes not yet due.
|
Section
5.9
|
Compliance with
Laws.
|
Except as
disclosed on Schedule
5.9, the Assets are, and the operation of the Assets is, in compliance
with the provisions and requirements of all Laws of all Governmental Bodies
having jurisdiction with respect to the Assets or the ownership, operation,
development, maintenance or use of any thereof, except where the failure to so
comply would not have a Material Adverse Effect. Notwithstanding the foregoing,
Seller make no representation or warranty, express or implied, under this
Section relating to any Environmental Liabilities or Environmental
Law.
|
Section
5.10
|
Material
Contracts.
|
(a) Schedule 5.10(a) contains a
true and complete listing of the following contracts or agreements to
which Seller is a party or by which any of the Assets is bound as of the date of
this Agreement (the contracts listed on Schedule 5.10(a) being
“Material Contracts”):
(i) each
natural gas gathering agreement;
(ii) each
contract involving a remaining commitment requiring payment of capital
expenditures in excess of $250,000;
(iii) each
contract or agreement between Affiliates having a value in excess of
$120,000;
(iv) each
contract or agreement with respect to the creation, incurrence, assumption of,
or guaranteeing or securing, any indebtedness for borrowed money;
(v) each
contract or agreement (A) imposing confidentiality or noncompetition
obligations, or (B) granting any Person a right of first refusal, first offer or
right to purchase any of the Assets, in each case, which will survive Closing;
and
(vi) each
contract or agreement not described in clauses (i) through (v) above involving
aggregate annual future payments or receipts in excess of $500,000.
(b) Except
as disclosed on Schedule
5.10(b), with respect to Seller and/or any of its Affiliates party
thereto (i) each Material Contract is in full force and effect and is valid,
binding and enforceable against such party and, to Seller’s knowledge, the other
party or parties to such Material Contract, in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency or other similar Laws
relating to creditors’ rights generally and subject, as to enforceability, to
general principles of equity and will continue to be valid, binding and
enforceable and in full force an effect on identical terms following the
consummation of the transaction contemplated by this Agreement; (ii) such party
has paid its share of all costs payable by them under the Material Contracts,
except those being contested
9
in good
faith in connection with the matters set forth on Schedule 5.10(b), and is not in breach or
default of, and no event has occurred which with notice or lapse of time would
constitute a default by such party or permit termination, modification or
acceleration under, any Material Contract, except for any such breach or default
as would not have a Material Adverse Effect, and (iii) to Seller’s knowledge, no
such other party to a Material Contract is in breach or default of or has
repudiated any provision of, and no event has occurred which with notice or
lapse of time would constitute a default by such other party or permit
termination, modification or acceleration under, any Material Contract, except
for any such breach, default or other matter as would not have a Material
Adverse Effect.
|
Section
5.11
|
Governmental
Authorizations.
|
Except as
disclosed in Schedule
5.11, Seller has obtained and is maintaining in full force and
effect all federal, state and local governmental licenses, permits, franchises,
orders, exemptions, variances, waivers, authorizations, certificates, consents,
rights, privileges and applications therefor (the “Governmental Authorizations”)
that are presently necessary or required for the ownership and operation of the
Assets as currently owned and operated, the loss of which would have a Material
Adverse Effect. Except as disclosed in Schedule 5.7 or Schedule 5.11 and except as would not have a
Material Adverse Effect, (a) Seller has operated the Assets in accordance, and
has otherwise complied, with the conditions and provisions of such Governmental
Authorizations, and (b) no written notices of violation have been received by
Seller, and no proceedings are pending or, to Seller’s knowledge, threatened in
writing, with respect to any alleged failure to have any Governmental
Authorization necessary or required to own or operate the Assets, that might
result in any modification, revocation, termination or suspension of any such
Governmental Authorizations or which would otherwise require any corrective or
remedial action by Seller.
|
Section
5.12
|
Preference Rights and
Transfer Requirements.
|
None of
the Assets, or any portion thereof, is subject to any Preference Right or, to
Seller’s knowledge, to any Transfer Requirement that may be applicable to the
transactions contemplated by this Agreement, except for Preference Rights and
Transfer Requirements as are set forth on Schedule 5.12.
|
Section
5.13
|
Outstanding Capital
Commitments.
|
As of the
date hereof, there are no outstanding AFEs or other commitments to make capital
expenditures that are binding on the Assets and that Seller reasonably
anticipate will individually require expenditures by the owner of the Assets
after the Closing Date in excess of $250,000 other than those shown on Schedule 5.13.
|
Section
5.14
|
Condemnation.
|
There is
no actual or, to Seller’s knowledge, threatened taking (whether permanent,
temporary, whole or partial) of any part of the Assets by reason of condemnation
or the threat of condemnation.
10
|
Section
5.15
|
Bankruptcy.
|
There are
no bankruptcy, reorganization or similar arrangement proceedings pending, being
contemplated by or, to Seller’s knowledge, threatened against Seller or any
Affiliate of Seller.
|
Section
5.16
|
NGA.
|
No
consent is required in connection with the transaction contemplated hereby under
the Natural Gas Policy Act of 1978, as amended. Seller is not an
interstate pipeline company within the meaning of the Natural Gas Act of
1938.
|
Section
5.17
|
Investment
Company.
|
Seller is
not an investment company or a company controlled by an investment company
within the meaning of the Investment Company Act of 1940, as
amended.
|
Section
5.18
|
No Tax
Partnership.
|
The
Assets are not subject to any tax partnership agreement or provisions requiring
a partnership income tax return to be filed under Subchapter K of Chapter 1 of
Subtitle A of the Code that will be binding upon Purchasers or the Assets after
the Closing.
|
Section
5.19
|
Insurance.
|
Schedule 5.19 contains a true
and complete list of all policies of insurance that are maintained by Seller and
that cover or relate to any of the Assets as of the date of this
Agreement. All premiums due and payable under such policies
have been paid. There is no claim pending under any of such policies
which relates specifically to the Assets as to which coverage with respect to
the policyholder or insured party has been denied or disputed by the
underwriters or issuers of such policy. No such policyholder has
received any written notice of cancellation of, indication of intention not to
renew, any of such policies All of such policies are in full force
and effect and will remain in full force and effect with respect to the Assets
upon consummation of the transactions contemplated by this
Agreement.
|
Section
5.20
|
Environmental.
|
To the
knowledge of Seller, except as set forth in Schedule 5.20 and as would not
have a Material Adverse Effect: (a) neither Seller nor any prior owner or
operator of the Assets has caused or allowed the generation, use, treatment,
storage or disposal of Hazardous Materials at or on any of the Assets except in
compliance with all applicable Environmental Laws; (b) Seller has conducted its
operations on the Assets, and the Assets otherwise are, in compliance with all
limitations, restrictions, standards and obligations established under
Environmental Laws; (c) Seller has obtained all permits, licenses,
authorizations, registrations, consents and approvals granted by any
Governmental Body or otherwise required under Environmental Laws that are
necessary for Seller’s operations on the Assets and have operated and are
operating in compliance with such permits, licenses, authorizations,
registrations, consents and approvals; (d) there are no Environmental
Liabilities pending or threatened by or before any court or any other
Governmental Body directed against Seller relating to Seller’s operations on the
Assets that pertain or relate to (i) any Remedial Action under any applicable
Environmental Law, (ii) non-compliances or alleged non-compliances by Seller of
any Environmental Law, or (iii)
11
personal injury or property damage claims relating to a release of
Hazardous Materials; and (e) there are no Adverse Environmental
Conditions.
|
Section
5.21
|
Title.
|
(a) Seller
has Defensible Title against all Persons claiming or to claim the same or any
part thereof by, through or under Seller or its Affiliates, but not
otherwise.
(b) Except
as set forth on Schedule
5.21(b) and except as would not have a Material Adverse Effect, (i)
Seller’s Surface Contracts constitute all of the easements, licenses, permits,
crossing agreements and similar right of way interests used or necessary for the
ownership and operation of the Assets in substantially the same manner as the
Assets were used, owned and operated by Seller as of the date of this Agreement
and immediately prior to the Closing, and (ii) no event has occurred or fact
exists that allows, or after notice or lapse of time would allow, revocation,
modification, or termination of any Surface Contracts.
|
Section
5.22
|
Intellectual
Property.
|
To the
Seller’s knowledge, the ownership and operation of the Assets, as currently
owned and operated, does not materially conflict with any patents, patent
rights, licenses, trademarks, trademark rights, trade names, trade
name rights or copyrights of any third parties.
|
Section
5.23
|
Condition of
Assets.
|
The
Pipelines and the Facility constructed by Seller or its Affiliates have been
constructed in all material respects in accordance with standard industry
practice; and the Pipelines, Facility and Equipment have been maintained and
repaired by Seller in all material respects in the same manner as would a
prudent operator and are adequate in all material respects for the purposes for
which they are currently being used.
ARTICLE
6
REPRESENTATIONS
AND WARRANTIES OF PURCHASERS
Purchasers
represent and warrant to Seller the following:
|
Section
6.1
|
Existence and
Qualification.
|
Each of
Purchasers is duly formed, validly existing and in good standing under the Laws
of its respective jurisdiction of incorporation. Each of Purchasers
is duly qualified to do business as a foreign limited partnership in every
jurisdiction in which it is required to qualify in order to conduct its business
except where the failure to so qualify would not have a material adverse effect
on such Purchaser or its properties. Each of Purchasers is duly
qualified to do business as a foreign limited partnership in the respective
jurisdictions where the Assets are located.
|
Section
6.2
|
Power.
|
Each of
Purchasers has the limited partnership power to execute and deliver, and to
incur and perform all of its obligations under, this Agreement and to consummate
the transactions contemplated by this Agreement.
12
|
Section
6.3
|
Authorization and
Enforceability.
|
The
execution, delivery and performance of this Agreement, and the performance of
the transactions contemplated hereby, have been duly and validly authorized by
all necessary limited
partnership action on the part of Purchasers. This Agreement has been, and all
documents required hereunder to be executed and delivered by Purchasers at
Closing will be, duly executed and delivered by Purchasers, and this Agreement
constitutes, and at the Closing such documents will constitute, the valid and
binding obligations of Purchasers, enforceable against Purchasers in accordance
with their terms except as such enforceability may be limited by applicable
bankruptcy or other similar laws affecting the rights and remedies of creditors
generally as well as to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
|
Section
6.4
|
No
Conflicts.
|
The
execution, delivery and performance of this Agreement by each of Purchasers and
the transactions contemplated herein will not (a) violate any
provision of the certificate of limited partnership, certificate of formation,
limited partnership agreement or other constituent documents of such Purchaser,
(b) except as set forth on Schedule 6.4(b), result in a
default (with due notice or lapse of time or both) or the creation of any lien
or encumbrance or give rise to any right of termination, cancellation or
acceleration under any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license or agreement to which such Purchaser is a party,
(c) violate any judgment, order, ruling or regulation applicable to such
Purchaser as a party in interest, (d) violate any Law applicable to such
Purchaser or any of its assets, or (e) require any filing with, notification of
or consent, approval or authorization of any Governmental Body or authority,
except any matters described in clauses (b), (c), (d) or (e) above that would
not have a material adverse effect on such Purchaser or the transactions
contemplated hereby.
|
Section
6.5
|
Liability for Brokers’
Fees.
|
Seller
shall not directly or indirectly have any responsibility, liability or expense
as a result of undertakings or agreements of Purchasers for brokerage fees,
finder’s fees, agent’s commissions or other similar forms of compensation in
connection with this Agreement or any agreement or transaction contemplated
hereby.
|
Section
6.6
|
Litigation.
|
There are
no actions, suits or proceedings pending or, to the actual knowledge of the
officers of either of Purchasers, threatened in writing before any Governmental
Body against Purchasers or any Affiliate of Purchasers that are reasonably
likely to impair materially the ability of Purchasers to perform their
respective obligations under this Agreement.
|
Section
6.7
|
Limitation.
|
Except
for the representations and warranties expressly made by Seller in Article 5 of this Agreement,
or confirmed in any certificate furnished or to be furnished to Purchasers
pursuant to this Agreement, Purchasers represent and acknowledge that (a) there
are no representations or warranties, express, statutory or implied, as to the
Assets or prospects thereof, and (b) Purchasers have not relied upon any oral or
written information provided by Seller. Purchasers further represent
and acknowledge (x) that Purchasers are knowledgeable
13
of the
natural gas gathering and processing business and of the usual and customary
practices of owners such as Seller and (y) in making the decision to enter into
this Agreement and consummate the transactions contemplated hereby, Purchasers
have relied solely on the basis of the terms and provisions of this
Agreement.
|
Section
6.8
|
Bankruptcy.
|
There are
no bankruptcy, reorganization or receivership proceedings pending against, being
contemplated by or, to the actual knowledge of Purchasers, threatened against
Purchasers.
ARTICLE
7
COVENANTS
OF THE PARTIES
|
Section
7.1
|
Access.
|
Between
the date of execution of this Agreement and the Closing Date, Seller will give
Purchasers and its representatives access to the Assets and access to the
Records in Seller’s possession for the purpose of conducting an investigation of
the Assets, but only to the extent that Seller may do so without violating any
obligations to any third party and to the extent that Seller has authority to
grant such access without breaching any restriction binding on
Seller. Such access by Purchasers shall be limited to Seller’s normal
business hours and any weekends and after hours requested by Purchasers that can
be reasonably accommodated by Seller, and the investigation by Purchasers shall
be conducted in a manner that minimizes interference with the operation of the
Assets. All information obtained by Purchasers and their respective
representatives under this Section, except as otherwise agreed to by Seller,
shall be maintained confidential.
|
Section
7.2
|
Government
Reviews.
|
Seller
and Purchasers shall in a timely manner (a) make all required filings, if any,
with, and prepare applications to and conduct negotiations with, each
governmental agency as to which such filings, applications or negotiations are
necessary or appropriate in the consummation of the transactions contemplated
hereby, including, without limitation, any such filings, applications or
negotiations under the HSR Act, (b) provide such information as each may
reasonably request to make such filings, prepare such applications and conduct
such negotiations and (c) request early termination or waiver of any applicable
waiting period under the HSR Act. Each party hereto shall cooperate with and use
all commercially reasonable efforts to assist the other with respect to such
filings, applications and negotiations.
|
Section
7.3
|
Notification of
Breaches.
|
(a) Until
the Closing, Purchasers and Seller shall each promptly give to the other party
or parties, as applicable, written notice with particularity upon obtaining
actual knowledge of any matter that would constitute a breach by such party or
parties, as applicable, of any representation, warranty, agreement or covenant
of such party or parties, as applicable, contained in this
Agreement. Purchasers and Seller each agree that, with respect to the
representations and warranties of such party or parties, as applicable,
contained in this Agreement, such party or parties, as applicable, shall have
the continuing right until the Closing to modify, supplement or amend such
party’s or parties’, as applicable, Schedules with respect to any matter
hereafter arising or discovered which would be required to be
14
disclosed
in such Schedules in order for such party or parties, as applicable, to be able
to deliver the certificate required to be delivered by such party or parties, as
applicable, pursuant to Section
9.2(b) or Section
9.3(c), as applicable, as such certificate relates to the representations
and warranties of such party or parties, as applicable. For all
purposes of this Agreement, including for purposes of whether the conditions set
forth in Article 8 have
been fulfilled,
a party’s or parties’, as applicable, Schedules shall be deemed to include only
that information contained therein on the date of this Agreement and shall be
deemed to exclude all information contained in any modification, supplement or
amendment thereto, but if the Closing shall occur, the all matters disclosed
pursuant to any such modification, supplement or amendment at or prior to the
Closing shall be waived and no party shall be entitled to make a claim thereon
under the terms of this Agreement.
(b) Notwithstanding
Section 7.3(a), if any
of Purchasers’ or Seller’s representations or warranties are untrue or shall
become untrue in any material respect between the date of execution of this
Agreement and the Closing Date, or if any of Purchasers’ or Seller’s covenants
or agreements to be performed or observed prior to or on the Closing Date shall
not have been so performed or observed in any material respect, but if such
breach of representation, warranty, covenant or agreement shall (if curable) be
cured by the Closing (or, if the Closing does not occur, by the date set forth
in Section 10.1(b)),
then such breach shall be considered not to have occurred for all purposes of
this Agreement.
|
Section
7.4
|
Assignments;
Operatorship.
|
(a) Seller
will prepare, and Seller and Cowtown will execute on the Closing Date, all
assignments necessary to convey to Cowtown all Surface Contracts in the form as
prescribed by the applicable Governmental Body and otherwise acceptable to
Purchasers and Seller. Purchasers, within thirty (30) days after
Closing, shall file for any requisite approval with the applicable Governmental
Body all assignment documents and other state and federal transfer documents
required to effectuate the transfer of the Assets. Purchasers further
agree promptly after Closing to take all other actions reasonably required of
Purchasers by federal or state agencies having jurisdiction to obtain all
requisite regulatory approvals with respect to this transaction and to use
Purchasers reasonable commercial efforts to obtain the approval by such federal
or state agencies, as applicable, of Seller’s assignment documents requiring
federal or state approval in order for Cowtown to be recognized by the federal
or state agencies as the owner of the Assets. Seller shall, as
reasonably requested by Purchasers, cooperate and assist Purchasers in complying
with its obligations under this Section 7.4(a).
(b) Purchasers
shall, promptly following Closing, file all appropriate forms and declarations
or bonds with federal and state agencies relative to the assumption by
Purchasers of operatorship of the Assets, and Seller shall, as reasonably
requested by Purchasers, cooperate and assist Purchasers with such
filings. Seller shall execute and deliver to Purchasers, and
Purchasers shall promptly file, the appropriate forms with the applicable
regulatory agency transferring operatorship of such Assets to
Cowtown.
(c) To
the extent required by the applicable state and federal Governmental Bodies,
Purchasers shall obtain, and Seller shall reasonably assist Purchasers in
obtaining, at Purchasers’ sole cost and expense, substitute surety or
performance bonds as may be required by, and in accordance with, such state or
federal regulations governing the ownership and operation of the
Assets.
15
|
Section
7.5
|
Public
Announcements.
|
No party
hereto shall make any press release or other public announcement regarding the
existence of this Agreement, the contents hereof or the transactions
contemplated hereby without the prior written consent of Seller or Purchasers,
as applicable (which consent shall not be unreasonably withheld of delayed);
provided, however, the foregoing shall not restrict disclosures
by Purchasers or Seller that are required by applicable securities or other laws
or regulations or the applicable rules of any stock exchange having jurisdiction
over the disclosing party or its Affiliates.
|
Section
7.6
|
Operation of
Business.
|
Except as
set forth on Schedule
7.6, until the Closing, Seller (a) will operate their business in the
ordinary course consistent with past practices, (b) will not, without the prior
written consent of Purchasers (i) commit to any operation, or series of
related operations, reasonably anticipated by Seller to require future capital
expenditures by the owner of the Assets in excess of $250,000, (ii) make
any capital expenditures in excess of $250,000, (iii) terminate, materially
amend, execute or extend any Material Contract or other material agreements
affecting the Assets; (iv) take any action or refrain from taking any action, or
enter into any contract or agreement that would result in the imposition of any
lien or encumbrance (other than Permitted Encumbrances) on any of the Assets; or
(v) file any material lawsuit relating to the Assets or cancel, compromise,
waive, release or settle any right, claim or lawsuit relating to the Assets,
other than immaterial rights and claims in the ordinary course of business, (c)
will maintain insurance coverage on the Assets presently furnished by
nonaffiliated third parties in the amounts and of the types presently in force,
(d) will use commercially reasonable efforts to maintain in full force and
effect all Surface Contracts, (e) will maintain all governmental permits and
approvals affecting the Assets, (f) will not transfer, sell, hypothecate,
encumber or otherwise dispose of any Assets except for sales and dispositions of
Equipment made in the ordinary course of business consistent with
past practices and (g) will not commit to do any of the foregoing. The approval
of Purchasers of any action restricted by this Section 7.6 shall be
considered granted within ten (10) days (unless a shorter time is reasonably
required by the circumstances and such shorter time is specified in Seller’s
written notice) of Seller’s notice to Purchasers requesting such consent unless
either of Purchasers notifies Seller to the contrary in writing during that
period. In the event of an emergency, Seller may take such action as a prudent
operator would take and shall notify Purchasers of such action promptly
thereafter.
|
Section
7.7
|
Transfer
Requirements.
|
(a) The
purchase of the Assets by Purchasers is expressly subject to all validly
existing and applicable Transfer Requirements. Prior to the Closing
Date, Seller shall initiate all procedures that in Seller’s good faith judgment
are reasonably required to comply with all Transfer Requirements with respect to
the transactions contemplated by this Agreement. Seller shall use
commercially reasonable efforts to obtain all applicable
consents. Seller shall not be obligated to pay any consideration to
(or incur any cost or expense for the benefit of) the holder of any Transfer
Requirement in order to comply therewith.
(b) To the
extent that the consent to assign any Material Contract is not obtained by
Closing (a "Retained Material Contract") and until such time that such Retained
Material Contract is assigned by Seller to Purchasers pursuant to this Section 7.7(b), (i) Seller
shall use commercially reasonably efforts to cooperate with Purchasers to
provide Purchasers with all of the economic and other benefits of such Retained
Material Contract that Purchasers are
16
denied or
deprived as a result of the failure to assign such Retained Material Contract at
Closing; provided, however, that under no circumstances shall Seller be
obligated to provide any economic or other benefits to Purchasers that are
greater than the economic or other benefits actually received by Seller under
such Retained Material Contract, and (ii) Purchasers shall bear the economic and
other burdens of all related liabilities and of the performance and compliance
with the terms of such Retained Material Contract, at no additional cost to
Seller, to the same extent as Purchasers would have borne such liabilities and
other obligations if Purchasers were a party to such Retained Material
Contract. Following Closing, subject to the last sentence of Section 7.7(a), Seller shall
continue to use commercially reasonable efforts to obtain the consent to assign
each Retained Material Contract to Purchasers. Once Seller obtains the consent
to assign to Purchasers a Retained Material Contract, Seller shall promptly
assign such Retained Material Contract to Purchasers and such Retained Material
Contract shall automatically be deemed to be an Asset effective as of the
effective date of such assignment.
(c) If
a Surface Contract is subject to a Transfer Requirement and such Transfer
Requirement is not waived, complied with or otherwise satisfied prior to the
Closing Date, then, unless otherwise mutually agreed by Seller and Purchasers,
the Surface Contract or portion thereof affected by such Transfer Requirement
together with all flow lines, pipelines, equipment, machinery, fixtures and
other tangible personal property and improvements located on and related to such
Surface Contract (collectively, a “Retained Asset”) shall be withheld from the
Assets to be transferred and conveyed to Cowtown at Closing, and such Retained
Asset shall be added to the properties that are subject to and bound by the
Lease Agreement that is executed and delivered at Closing. The
parties acknowledge and agree that the Purchase Price to be paid at Closing
shall not be reduced and the rent to be paid by Cowtown to Seller under the
Lease Agreement shall not be increased on account of any Retained
Asset. Any Retained Asset so held back and added to the Lease
Agreement at the Closing will be released from the Lease Agreement and conveyed
to Cowtown at a delayed closing within ten (10) days following the date on which
Seller obtains, complies with or otherwise satisfies all Transfer Requirements
with respect to the surface contract included within such Retained Asset (such
date being the “Closing Date” with respect to such Retained Asset) and such
Retained Asset shall automatically be deemed to be an Asset effective as of the
Closing Date applicable to such Retained Asset.
|
Section
7.8
|
Tax
Matters.
|
(a) Subject
to the provisions of Section
12.3, Seller shall be responsible for all Taxes related to the Assets
(including without duplication, Seller’s portion of any ad valorem, property,
and similar Taxes based upon or measured by the ownership or operation of the
Assets, which are addressed in Section 1.4) attributable to
any period of time at or prior to the Effective Time, and Purchasers shall be
responsible for all such Taxes related to the Assets attributable to any period
of time after the Effective Time. Regardless of which party is responsible,
Seller shall handle payment to the appropriate Governmental Body of all Taxes
with respect to the Assets that are required to be paid prior to Closing (and
shall file all Tax Returns with respect to such Taxes). If requested by
Purchasers, Seller will assist Purchasers with preparation of all ad valorem and
property Tax Returns attributable to the period on or before December 31, 2009
(including any extensions requested). Seller shall deliver to Purchasers within
thirty (30) days of filing copies of all Tax Returns filed by Seller after the
Effective Time relating to the Assets and any supporting documentation provided
by Seller to taxing authorities, excluding Tax Returns related to income tax,
franchise tax or other similar Taxes.
17
(b) Purchasers
agree to reasonably cooperate (at no cost or liability to Purchasers) with
Seller so that Seller’s transfer of all or any portion designated by Seller of
the Assets to Purchasers shall, at Seller’s election, be accomplished in a
manner enabling the transfer to qualify as a part of a like-kind exchange of
property by Seller within the meaning of Section 1031 of the Internal Revenue
Code of 1986, as amended (the “Code”). If Seller so elects,
Purchasers shall reasonably cooperate with Seller to effect such like-kind
exchange, which cooperation shall include, without limitation, taking such
actions as Seller reasonably requests in order to pay the Purchase Price in a
manner that enables such transfer to qualify as part of a like-kind exchange of
property within the meaning of Section 1031 of the Code, and Purchasers agree
that Seller may assign its rights (but not its obligations) under
this Agreement to a qualified intermediary as defined in Treasury Regulations
Section 1.1031(k) – 1(g)(4)(iii) under United States Treasury Regulations, to
qualify the transfer of the Purchase Price as a part of a like-kind exchange of
property within the meaning of Section 1031 of the Code. Seller and Purchasers
acknowledge and agree that any assignment of this Agreement to a qualified
intermediary shall not release Seller from any of its liabilities and
obligations to Purchasers under this Agreement, and that neither Seller nor
either of Purchasers represents to Purchasers or Seller, as applicable, that any
particular tax treatment will be given to any party hereto as a result
thereof.
|
Section
7.9
|
Further
Assurances.
|
After
Closing, Seller and Purchasers each agree to take such further actions and to
execute, acknowledge and deliver all such further documents as are reasonably
requested by the other party for carrying out the purposes of this Agreement or
of any document delivered pursuant to this Agreement.
|
Section
7.10
|
Eni
GGA.
|
If Eni
exercises its right to have its natural gas gathered pursuant to the terms of
the Eni GGA during the initial term of the Eni GGA (which initial term expires
on March 31, 2019), Seller shall pay to Purchasers, on a monthly basis, for the
volume of natural gas gathered for Eni pursuant to the Eni GGA during the month
in question, the difference between the gathering fee per MMBtu that is from
time to time payable by Quicksilver pursuant to the QRI GGA and the gathering
fee per MMBtu that is from time to time payable by Eni pursuant to the Eni
GGA.
|
Section
7.11
|
Rights-of-Way
Amendments.
|
The
parties acknowledge that certain of the Excluded Rights-of-Way do not allow the
laying of a twenty inch pipe and that Purchasers intend to seek amendments from
the grantors of such rights-of-way to allow the laying by Purchasers of twenty
inch pipe. Such amendments shall be in form and substance reasonably
acceptable to Seller and, subject to the immediately following sentences, shall
be obtained by Purchasers at the sole cost and expense of
Purchasers. Purchasers acknowledge that, in certain instances, the
existing pipe that was laid pursuant to an Excluded Right-of-Way was laid
outside of the right-of-way that was granted pursuant thereto. To the
extent that the consideration that Purchasers are required to pay to the grantor
of such an Excluded Right-of-Way for an amendment thereto is increased as a
result of the fact that existing pipe has been laid outside of the right-of-way
that was granted thereby, Seller agrees that it shall promptly reimburse
Purchasers for the difference between the consideration that Purchasers pay the
grantor for such amendment and the consideration that Seller would have had to
pay the grantor for such amendment had the existing pipe been properly laid
within the right-of-way.
18
ARTICLE
8
CONDITIONS
TO CLOSING
|
Section
8.1
|
Conditions of Seller
to Closing.
|
The
obligations of Seller to consummate the transactions contemplated by this
Agreement are subject, at the option of Seller, to the satisfaction on or prior
to Closing of each of the following conditions:
(a) Representations. The
representations and warranties of Purchasers set forth in Article 6 shall be true and
correct in all material respects, other than representations and warranties that
are already qualified as to materiality or material adverse effect, which shall
be true and correct in all respects, as of the Closing Date as though made on
and as of the Closing Date;
(b) Performance.
Purchasers shall have performed and observed in all material respects all
covenants and agreements to be performed or observed by Purchasers under this
Agreement prior to or on the Closing Date;
(c) Pending
Litigation. No suit, action or other proceeding by a third
party (including any Governmental Body) seeking to restrain, enjoin or otherwise
prohibit the consummation of the transactions contemplated by this Agreement or
to recover damages from Seller on account therefrom shall be pending or
threatened before any Governmental Body or arbitral tribunal;
(e) Casualty or
Condemnation. The aggregate losses from casualties to the
Assets and takings of Assets under right of eminent domain shall be less than
ten percent (10%) of the Purchase Price;
(f) Payment. Purchasers
shall have paid (or be ready, willing and able to immediately pay) the Closing
Payment; and
(g) HSR
Act. Any waiting period applicable to the consummation of the
transactions contemplated by this Agreement under the HSR Act shall have lapsed
or terminated (by early termination or otherwise).
|
Section
8.2
|
Conditions of
Purchasers to Closing.
|
The
obligations of Purchasers to consummate the transactions contemplated by this
Agreement are subject, at the option of Purchasers, to the satisfaction on or
prior to Closing of each of the following conditions:
(a) Representations. The
representations and warranties of Seller set forth in Article 5 shall be true and
correct in all material respects, other than representations and warranties that
are already qualified as to materiality or Material Adverse Effect, which shall
be true and correct in all respects, as of the Closing Date as though made on
and as of the
19
Closing
Date (other than representations and warranties that refer to a specified date
which need only be true and correct on and as of such specified
date);
(b) Performance. Seller
shall have performed and observed in all material respects all covenants and
agreements to be performed or observed by them under this Agreement prior to or
on the Closing Date;
(c) Pending
Litigation. No suit, action or other proceeding by a third
party (including any Governmental Body) seeking to restrain, enjoin or otherwise
prohibit the consummation of the transactions contemplated by this Agreement or
to recover damages from Purchasers on account therefrom shall be pending or
threatened before any Governmental Body or arbitral tribunal;
(d) Deliveries. Seller
shall have delivered (or be ready, willing and able to immediately deliver) to
Purchasers duly executed counterparts of the Conveyance and the other documents
and certificates to be delivered by Seller under Section 9.2;
(e) Casualty or
Condemnation. The aggregate losses from casualties to the
Assets and takings of Assets under right of eminent domain shall be less than
ten percent (10%) of the Purchase Price; and
(f) HSR
Act. Any waiting period applicable to the consummation of the
transactions contemplated by this Agreement under the HSR Act shall have lapsed
or terminated (by early termination or otherwise).
ARTICLE
9
CLOSING
|
Section
9.1
|
Time and Place of
Closing.
|
(a) Consummation
of the purchase and sale transaction as contemplated by this Agreement (the
“Closing”) shall, unless otherwise agreed to in writing by Purchasers and
Seller, take place at the offices of Seller located at 777 West Rosedale Street,
Fort Worth, Texas, at 10:00 a.m., local time, on December 29, 2009 or, if all
conditions in Article 8
to be satisfied prior to Closing have not yet been satisfied or waived, as soon
thereafter as such conditions have been satisfied or waived, subject to the
rights of the parties under Article 10.
(b) The
date on which the Closing occurs is herein referred to as the “Closing
Date.”
|
Section
9.2
|
Obligations of Seller
at Closing.
|
At the
Closing, upon the terms and subject to the conditions of this Agreement, Seller
shall deliver or cause to be delivered to Purchasers the following:
(a) the
Conveyance, in sufficient duplicate originals to allow recording in all
appropriate jurisdictions and offices, duly executed by Seller;
(b) a
certificate duly executed by an authorized corporate officer of Seller, dated as
of Closing, certifying on behalf of Seller that the conditions set forth in
Sections 8.2(a) and
8.2(b) have been
fulfilled;
20
(c) the
Lease Agreement, duly executed by Seller;
(d) the
Parent Guaranty, duly executed by Quicksilver;
(e) one
(1) original executed statement described in Treasury Regulation §1.1445-2(b)(2)
certifying that Seller is not a foreign person within the meaning of the Code;
and
(f) an
agreement terminating the (i) rights of Purchasers and their respective
Affiliates who are parties to the Option Agreement and (ii) obligations of
Quicksilver and its Affiliates who are parties to the Option Agreement under the
Option Agreement, duly executed by Quicksilver and such Affiliates of
Quicksilver.
|
Section
9.3
|
Obligations of
Purchasers at Closing.
|
At the
Closing, upon the terms and subject to the conditions of this Agreement,
Purchasers shall deliver or cause to be delivered to Seller the
following:
(a) a
wire transfer of the Closing Payment in same-day funds to the account of Seller
set forth on Schedule
9.3(a);
(b) the
Conveyance, duly executed by Cowtown;
(c) a
certificate duly executed by an authorized officer of the general partner of
each of Purchasers, dated as of Closing, certifying on behalf of Purchasers that
the conditions set forth in Sections 8.1(a) and 8.1(b) have been
fulfilled;
(d) the
Lease Agreement, duly executed by Cowtown; and
(e) an
agreement terminating the (i) rights of Purchasers and their respective
Affiliates who are parties to the Option Agreement and (ii) obligations of
Quicksilver and its Affiliates who are parties to the Option Agreement under the
Option Agreement, duly executed by Purchasers and such Affiliates of
Purchasers.
|
Section
9.4
|
Closing Payment &
Post-Closing Purchase Price
Adjustments.
|
(a) Not
later than three (3) Business Days prior to the Closing Date, Seller shall
prepare and deliver to Purchasers for their review and approval, based upon the
best information available to Seller, a preliminary settlement statement
estimating the Adjusted Purchase Price after giving effect to all Purchase Price
adjustments provided for in Section 2.2. The estimate
delivered in accordance with this Section 9.4(a) shall
constitute the dollar amount to be paid by Purchasers to Seller at the Closing
(the “Closing Payment”).
(b) As
soon as reasonably practicable after the Closing but not later than one hundred
and twenty (120) days following the Closing Date, Seller shall prepare and
deliver to Purchasers a statement setting forth the final calculation of the
Adjusted Purchase Price and showing the calculation of each adjustment, based,
to the extent possible, on actual credits, charges, receipts and other items
before and after the Effective Time and taking into account all adjustments
provided for in this Agreement. Seller shall, at the request of Purchasers,
supply reasonable documentation available to support any credit, charge, receipt
or other item. As soon as reasonably practicable, but not later than the 30th
day following receipt of
21
Seller’s
statement hereunder, Purchasers shall deliver to Seller a written report
containing any changes that Purchasers propose be made to such statement. The
parties shall undertake to agree on the final statement of the Adjusted Purchase
Price no later than one hundred eighty (180) days after the Closing Date. In the
event that the parties cannot reach agreement within such period of time, either
Seller or Purchasers may refer the remaining matters in dispute to
PricewaterhouseCoopers or such other nationally-recognized independent
accounting firm as may be accepted by Purchasers and Seller, for review and
final determination. The accounting firm shall conduct the arbitration
proceedings in Fort Worth, Texas in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, to the extent such rules do not
conflict with the terms of this Section 9.4. The accounting
firm’s determination shall be made within thirty (30) days after submission of
the matters in dispute and shall be final and binding on the parties hereto,
without right of appeal. In determining the proper amount of any adjustment to
the Purchase Price, the accounting firm shall not increase the Purchase Price
more than the increase proposed by Seller nor decrease the Purchase Price more
than the decrease proposed by Purchasers, as applicable. The accounting firm
shall act as an expert for the limited purpose of determining the specific
disputed matters submitted by Seller or Purchasers and may not award damages or
penalties to Seller or Purchasers with respect to any matter. Seller and
Purchasers shall each bear their own legal fees and other costs of presenting
their cases. Seller, on the one hand, and Purchasers, on the other hand, shall
bear one-half of the costs and expenses of the accounting firm. Within ten (10)
Business Days after the date on which the parties or the accounting firm, as
applicable, finally determines the disputed matters, (i) Purchasers shall pay to
Seller the amount by which the Adjusted Purchase Price exceeds the Closing
Payment or (ii) Seller shall pay to Purchasers the amount by which the Closing
Payment exceeds the Adjusted Purchase Price, as applicable. Any post-Closing
payment pursuant to this Section 9.4(b) shall bear
interest at the Agreed Interest Rate from
the Closing Date to the date both Seller and Purchasers have executed the final
settlement statement.
(c) All
payments made or to be made hereunder to Seller shall be by electronic transfer
of immediately available funds to the account of Seller set forth on Schedule 9.3(a) or to such
other account as may be specified by Seller in writing. All payments
made or to be made hereunder to Purchasers shall be by electronic transfer of
immediately available funds to a bank and account specified by Purchasers in
writing to Seller.
ARTICLE
10
TERMINATION
|
Section
10.1
|
Termination.
|
Unless
terminated earlier pursuant to other provisions provided herein, this Agreement
may be terminated at any time prior to Closing:
(a) by
the mutual prior written consent of Seller and Purchasers;
(b) by
either Purchasers or Seller, if Closing has not occurred on or before
December 31, 2009 (the “Termination Date”); provided, however, that the
right to terminate this Agreement under this Section 10.1(b) shall not be
available (i) to Seller, if any breach of this Agreement by Seller has been the
principal cause of, or resulted in, the failure of the Closing to occur on or
before the Termination Date or (ii) to Purchasers, if any breach of this
Agreement by Purchasers has been the principal cause of, or resulted in, the
failure of the Closing to occur on or before the Termination Date;
22
(c) by
Seller, if (i) any of the representations and warranties of Purchasers contained
in this Agreement shall not be true and correct in all material respects
(provided that any such representation or warranty that is already qualified by
a materiality standard shall not be further qualified); or (ii) Purchasers shall
have failed to fulfill in any material respect any of the obligations under this
Agreement required to be fulfilled prior to Closing; and, in the case of each of
clauses (i) and (ii), such misrepresentation or breach of warranty, covenant or
agreement, if curable, has not been cured within ten (10) days after written
notice thereof from Seller to Purchasers; provided that any cure period shall
not extend beyond the Termination Date and shall not extend the Termination
Date;
(d) by
Purchasers, if (i) any of the representations and warranties of Seller contained
in this Agreement shall not be true and correct in all material respects
(provided that any such representation or warranty that is already qualified by
a materiality standard shall not be further qualified); or (ii) Seller shall
have failed to fulfill in any material respect any of its obligations under this
Agreement required to be fulfilled prior to Closing; and, in the case of each of
clauses (i) and (ii), such misrepresentation or breach of warranty, covenant or
agreement, if curable, has not been cured within ten (10) days after written
notice thereof from Purchasers to Seller; provided that any cure period shall
not extend beyond the Termination Date and shall not extend the Termination
Date; or
(e) by
Purchasers or Seller, if any Governmental Body having competent jurisdiction has
issued a final, nonappealable order, decree, ruling or injunction prohibiting
consummation of the transactions contemplated by this
Agreement.
|
Section
10.2
|
Effect of
Termination.
|
If this
Agreement is terminated pursuant to Section 10.1, this Agreement
shall be of no further force or effect (except for the provisions of Sections 5.6, 6.5, 7.5, 11.8, 11.9, 12.7, 12.13 and 12.16 of this
Agreement and this Article
10, all of which shall continue in full force and effect), and Seller
shall be free immediately to enjoy all rights of ownership of the Assets and to
sell, transfer, encumber or otherwise dispose of the Assets to any party without
any restriction under this Agreement. In the event this Agreement
terminates under Section
10.1 because (i) any of the conditions to Closing set forth in Section 8.2(a) or Section 8.2(b) have not been
satisfied or (ii) Seller’s refusal or inability to close notwithstanding
the satisfaction of the conditions precedent set forth in Section 8.1, then Purchasers
shall be entitled to all remedies available at law or in equity and shall be
entitled to recover court costs and attorneys’ fees in addition to any other
relief to which Purchasers may be entitled. In the event this
Agreement terminates under Section 10.1 because (i)
any of the conditions to Closing set forth in Section 8.1(a) or Section 8.1(b) have not been
satisfied or (ii) the refusal or inability of Purchasers to close
notwithstanding the satisfaction of the conditions precedent set forth in Section 8.2, then Seller shall
be entitled to all remedies available at law or in equity and shall be entitled
to recover court costs and attorney’s fees in addition to any other relief to
which Seller may be entitled.
23
ARTICLE
11
POST-CLOSING
OBLIGATIONS; INDEMNIFICATION;
LIMITATIONS;
DISCLAIMERS AND WAIVERS
|
Section
11.1
|
Receipts.
|
Except as
otherwise provided in this Agreement, any income, proceeds, receipts and credits
attributable to the Assets that are not reflected in the adjustments to the
Purchase Price following the final adjustment pursuant to Section 9.4(b) shall be
treated as follows: (a) all income, proceeds, receipts and credits earned with
respect to the Assets to which Purchasers are entitled under Section 1.4 shall be the sole
property and entitlement of Purchasers and, to the extent received by Seller,
Seller shall fully disclose, account for and remit the same promptly to
Purchasers, and (b) all income, proceeds, receipts and credits earned with
respect to the Assets to which Seller is entitled under Section 1.4 shall be the sole
property and entitlement of Seller, and, to the extent received by Purchasers,
Purchasers shall fully disclose, account for and remit the same promptly to
Seller. Notwithstanding anything herein provided to the contrary,
Seller does hereby acknowledge and agree that Purchasers shall be entitled to
any CoServ Reimbursement paid to Seller or Quicksilver and that any CoServ
Reimbursement paid to either of them shall be promptly remitted to
Purchasers.
|
Section
11.2
|
Expenses.
|
Any
Property Costs that are not reflected in the adjustments to the Purchase Price
following the final adjustment pursuant to Section 9.4(b) shall be
treated as follows: (a) all Property Costs for which Seller is responsible under
Section 1.4 shall be the
sole obligation of Seller, and Seller shall promptly pay, or, if paid by either
of Purchasers, promptly reimburse Purchasers for and hold Purchasers harmless
from and against, such Property Costs; and (b) all Property Costs for which
Purchasers are responsible under Section 1.4 shall be the sole
obligation of Purchasers, and Purchasers shall promptly pay, or, if paid by
Seller, promptly reimburse Seller for and hold Seller harmless from and against,
such Property Costs. Furthermore, Seller shall promptly pay, or if
paid by Purchasers, promptly reimburse Purchasers for and hold Purchasers
harmless from and against, any costs (other than Property Costs) which result in
the increase of the Purchase Price pursuant to Section 2.2. Seller
is entitled to resolve all joint interest audits and other audits of Property
Costs covering periods for which Seller is in whole or in part responsible,
provided that Seller shall not agree to any adjustments to previously assessed
costs for which Purchasers are liable without the prior written consent of
Purchasers, such consent not to be unreasonably withheld. Seller shall provide
Purchasers with a copy of all applicable audit reports and written audit
agreements received by Seller and relating to periods for which Purchasers are
partially responsible.
|
Section
11.3
|
Assumed Seller
Obligations.
|
Without
limiting the rights of Purchasers to indemnity under this Article 11, on the Closing
Date, Purchasers shall assume and hereby agree to fulfill, perform, pay and
discharge (or cause to be fulfilled, performed, paid or discharged) all of the
obligations and liabilities of Seller known or unknown, with respect to the
Assets, regardless of whether such obligations or liabilities arose prior to on
or after the Effective Time including, but not limited to, obligations to (a)
dismantle, salvage and remove any equipment, structures, materials, platforms,
flowlines and property of whatever kind related to or associated with operations
and activities conducted on the Assets or otherwise pursuant to the Assets, (b)
clean up, restore and/or remediate the premises covered by or related to the
Assets in accordance with applicable agreements and
24
Laws and
(c) perform all obligations applicable to or imposed by or under the Surface
Contracts or the Contracts, or as required by applicable Laws (all of such
obligations and liabilities herein being referred to as the “Assumed Seller
Obligations”). Purchasers do not accrue any rights or assume any obligations or
liabilities of Seller to the extent that they are (such excluded obligations and
liabilities, the “Retained Seller Obligations”):
(i) attributable
to or arise out of the Excluded Assets;
(ii) the
continuing responsibility of the Seller under Sections 11.1 and 11.2 or matters for which
Seller is required to indemnify Purchasers under Section 11.4(c);
(iii) related
to personal injury or death arising or occurring prior to the Closing Date that
are attributable to Seller’s ownership or operation of the Assets;
(iv) Retained
Employee Liabilities;
(v) attributable
to or arise out of any off-site Environmental Liabilities occurring prior to the
Closing Date that relate to the Assets; or
(vi) attributable
to or arise out of the matter referenced in Schedule 5.7.
|
Section
11.4
|
Indemnities.
|
(a) Definitions.
“Claim”
or “Claims” means, unless specifically provided otherwise, all claims
(including, but not limited to, those for damage to property, bodily injury and
death, personal injury, illness, disease, maintenance, cure, loss of parental
and spousal consortium, wrongful death, loss of support and wrongful termination
of employment), damages, liabilities, losses, demands, liens, encumbrances,
fines, penalties, causes of action of any kind (including actions for indirect,
consequential, punitive and exemplary damages), obligations, costs (including
payment of all reasonable attorneys’ fees and costs of litigation), judgments,
interest, and awards or amounts, of any kind or character, whether under
judicial proceedings, administrative proceedings, investigation by a
Governmental Body or otherwise, or conditions in the premises of or attributable
to any Person or Persons or any party or parties, breach of representation or
warranty (expressed or implied), under any theory of tort, contract, breach of
contract (including any Claims that arise by reason of indemnification or
assumption of liability contained in other contracts entered into by an
Indemnified Party hereunder), at law or in equity, under statute, or otherwise,
arising out of, or incident to or in connection with this Agreement or the
ownership or operation of the Assets.
The
phrase “REGARDLESS OF
FAULT” means WITHOUT
REGARD TO THE CAUSE OR CAUSES OF ANY CLAIM, INCLUDING, WITHOUT LIMITATION, EVEN
THOUGH A CLAIM IS CAUSED IN WHOLE OR IN PART BY:
THE
NEGLIGENCE (WHETHER SOLE, JOINT, CONCURRENT, COMPARATIVE, CONTRIBUTORY, ACTIVE
OR PASSIVE), STRICT LIABILITY OR OTHER FAULT (BUT
25
EXCLUDING
GROSS NEGLIGENCE AND WILLFUL MISCONDUCT) OF PURCHASER INDEMNITEES, SELLER
INDEMNITEES, INVITEES AND/OR THIRD PARTIES; AND/OR
A
PRE-EXISTING DEFECT, WHETHER PATENT OR LATENT, OF THE PREMISES OF THE PROPERTY
OF EITHER OF PURCHASERS OR SELLER’S PROPERTY (INCLUDING, WITHOUT LIMITATION, THE
ASSETS).
(b) Purchasers
Indemnity Obligation. From and after the
Closing, subject only to Section 11.4(c) and the limitations contained in
Section 11.7, Purchasers shall be responsible for and indemnify, defend, release
and hold harmless Seller Indemnitees from and against all Claims to the extent
caused by, arising out of or resulting from:
(i) the
Assumed Seller Obligations, REGARDLESS OF
FAULT;
(ii) the
ownership, use or operation of the Assets after the Effective Time, REGARDLESS OF
FAULT;
(iii) the
breach by either of the Purchasers of any of the covenants or agreements of
Purchasers contained in this Agreement, REGARDLESS OF
FAULT;
(iv) any
breach of any representation or warranty made by Purchasers contained in Article 6 of this Agreement or
confirmed in the certificate delivered by Purchasers at Closing pursuant to
Section 9.3(c), REGARDLESS OF FAULT;
and
(v) Environmental
Laws, Environmental Liabilities, Adverse Environmental Conditions, the release
of materials into the environment or protection of human health, safety, natural
resources or the environment, or any other environmental condition of the
Assets, REGARDLESS OF
FAULT.
(c) Seller
Indemnity Obligation. From and after the
Closing, subject only to the limitations contained in Section 11.7, Seller shall
be responsible for and indemnify, defend
and hold harmless Purchaser Indemnitees against and from all Claims to the
extent caused by, arising out of or resulting from:
(i) any
breach of any representation or warranty of Seller contained in Article 5 of this Agreement or
confirmed in any certificate furnished by or on behalf of Seller at Closing
pursuant to Section 9.2(b),
REGARDLESS OF FAULT; provided, however, that the knowledge qualifier set
forth in Section 5.12
shall be disregarded for purposes of determining whether a breach of the
representation and warranty set forth in Section 5.12 has
occurred;
(ii) any
breach or nonfulfillment of or failure to perform any covenant or agreement of
Seller contained in this Agreement, REGARDLESS OF FAULT;
and
(iii) the
Retained Seller Obligations.
26
(d) Additional
Provisions.
It is the
intention of the parties that this Article 11 shall govern the
allocation of risks and liabilities between Purchasers and Seller except to the
extent that it is expressly stated (whether elsewhere in this Article 11 or in some other
Article hereof) that the provisions of such other Article (or part thereof)
shall control over the terms of all or part of this Article 11.
Notwithstanding
anything to the contrary contained in this Agreement, this Section 11.4 contains the
parties’ exclusive remedy against Seller or Purchasers, or applicable, with
respect to breaches of the representations, warranties, covenants and agreements
of the parties contained in Articles 5 and 6 and Sections 7.1, 7.2, 7.3, 7.4, 7.5, 7.6, 7.10 and 7.11 and the affirmations of
such representations, warranties, covenants and agreements contained in the
certificate delivered by each party at Closing pursuant to Section 9.2(b) or 9.3(c), as
applicable.
|
Section
11.5
|
Indemnification
Actions.
|
All
claims for indemnification under Section 11.4 shall be asserted
and resolved as follows:
(a) For
purposes of this Article
11, the term “Indemnifying Party” shall mean the party or parties having
an obligation to indemnify the other party or parties pursuant to the terms of
this Agreement. The term “Indemnified Party” shall mean the party or
parties having the right to be indemnified by the other party or parties
pursuant to the terms of this Agreement.
(b) To
make a claim for indemnification (“Indemnity Claim”) under Section 11.4 and/or any other
Article (or part thereof) expressly stating that it controls over the terms of
this Article 11, an
Indemnified Party shall notify the Indemnifying Party in writing of its
Indemnity Claim, including the specific details of and specific basis under this
Agreement for its Indemnity Claim (the “Claim Notice”). The
Indemnified Party shall provide its Claim Notice promptly after the Indemnified
Party has actual knowledge of the Claim for which it seeks indemnification and
shall enclose a copy of all papers (if any) served with respect to the Claim;
provided that the failure of any Indemnified Party to give notice of a Claim as
provided in this Section
11.5 shall not relieve the Indemnifying Party of its obligations under
Section 11.4 except to
the extent such failure results in insufficient time being available to permit
the Indemnifying
Party to effectively defend against the Claim or otherwise prejudices the
Indemnifying Party’s ability to defend against the Claim. In the event that the
Indemnity Claim is based upon an inaccuracy or breach of a representation,
warranty, covenant or agreement, the Claim Notice shall specify the
representation, warranty, covenant or agreement that was inaccurate or
breached.
(c) The
Indemnifying Party shall have thirty (30) days from its receipt of the Claim
Notice to notify the Indemnified Party whether it admits or denies its liability
to defend the Indemnified Party against the relevant Claim at the sole cost and
expense of the Indemnifying Party. The Indemnified Party is authorized, prior to
and during such 30-day period, to file any motion, answer or other pleading that
it shall deem necessary or appropriate to protect its interests or those of the
Indemnifying Party and that is not prejudicial to the Indemnifying
Party.
(d) If
the Indemnifying Party admits its liability to indemnify the Indemnified Party,
it shall have the right and obligation to diligently defend, at its sole cost
and expense, the Claim.
27
The
Indemnifying Party shall have full control of such defense and proceedings,
including any compromise or settlement thereof. If requested by the Indemnifying
Party, the Indemnified Party agrees to cooperate in contesting any Claim that
the Indemnifying Party elects to contest. The Indemnified Party may participate
in, but not control, any defense or settlement of any Claim controlled by the
Indemnifying Party pursuant to this Section 11.5(d). An
Indemnifying Party shall not, without the written consent of the Indemnified
Party, (i) settle any Claim or consent to the entry of any judgment with respect
thereto that does not include an unconditional written release of the
Indemnified Party from all liability in respect of such Claim, or (ii) settle
any Claim or consent to the entry of any judgment with respect thereto in any
manner that may materially and adversely affect the Indemnified Party (other
than as a result of money damages covered by the indemnity).
(e) If
the Indemnifying Party does not admit its liability to indemnify the Indemnified
Party or admits its liability but fails to diligently prosecute or settle the
Claim, then the Indemnified Party shall have the right to defend against the
Claim at the sole cost and expense of the Indemnifying Party, with counsel of
the Indemnified Party’s choosing, subject to the right of the Indemnifying Party
to admit its liability and assume the defense of the Claim at any time prior to
settlement or final determination thereof. If the Indemnifying Party has not yet
admitted its liability for a Claim, the Indemnified Party shall send written
notice to the Indemnifying Party of any proposed settlement, and the
Indemnifying Party shall have the option for ten (10) Business Days following
receipt of such notice to (i) admit in writing its liability to indemnify the
Indemnified Party from and against the Claim and, (ii) if liability is so
admitted, reject, in its reasonable judgment, the proposed
settlement.
|
Section
11.6
|
Release.
|
(a) EXCEPT
TO THE EXTENT EXPRESSLY SET FORTH IN THIS AGREEMENT, PURCHASERS RELEASE, REMISE
AND FOREVER DISCHARGE SELLER INDEMNITEES FROM ANY AND ALL CLAIMS, KNOWN OR
UNKNOWN, WHETHER NOW EXISTING OR ARISING IN THE FUTURE, CONTINGENT OR OTHERWISE,
WHICH PURCHASERS MIGHT NOW OR SUBSEQUENTLY MAY HAVE AGAINST SELLER INDEMNITEES,
RELATING DIRECTLY OR INDIRECTLY TO CLAIMS ARISING OUT OF OR INCIDENT TO
ENVIRONMENTAL LAWS, ENVIRONMENTAL LIABILITIES, THE RELEASE OF
MATERIALS INTO THE ENVIRONMENT OR PROTECTION OF HUMAN HEALTH, SAFETY, NATURAL
RESOURCES OR THE ENVIRONMENT, INCLUDING, WITHOUT LIMITATION, RIGHTS TO
CONTRIBUTION
UNDER THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT
OF 1980, AS AMENDED, REGARDLESS OF FAULT.
(b) Each
of Purchasers covenants and agrees that it will not attempt to avoid the effect
of the release made by it hereinabove by later arguing that at the time of the
release it did not fully appreciate the extent of any such environmental
Claims.
|
Section
11.7
|
Limitation on
Actions.
|
(a) The
representations, warranties, covenants and agreements provided for in this
Agreement, including the representations and warranties of the parties in Articles 5 and 6, shall survive Closing for
one year except that (i) the representation and warranties in Section 5.8 shall survive for
the applicable statute of limitations period, (ii) the representation and
warranties in Section
5.20 and 5.21
shall survive for 30 months following Closing, (iii) representation and
warranties in Section 5.3, 5.4,
6.2 and 6.3 shall
survive indefinitely and (iv) the covenants and agreements contemplated to be
complied with or performed following the
28
Closing
shall survive indefinitely, except that the covenants and agreements of Seller
in Section 7.11
shall survive the Closing for twenty-four months. Representations, warranties,
covenants and agreements shall be of no further force and effect after the date
of their expiration, provided that there shall be no termination of any bona
fide Claim asserted pursuant to this Agreement with respect to the breach of
such a representation, warranty, covenant or agreement on or before its
expiration date.
(b) The
indemnities in Sections
11.4(b)(iii), 11.4(b)(iv), 11.4(c)(i) and 11.4(c)(ii) shall terminate as
of the termination date of each respective representation, warranty, covenant or
agreement that is subject to indemnification, except in each case as to Claims
asserted pursuant to this Agreement with respect to the breach of such
representation, warranty, covenant or agreement on or before such termination
date. The indemnities of Purchasers in Sections 11.4(b)(i),
11.4(b)(ii) and 11.4(b)(v) and Seller’s
indemnity in Section
11.4(c)(iii) shall continue without time limit.
(c) Seller
shall not have any liability for any indemnification under Section 11.4(c)(i) for any
representation or warranty that is not qualified by Material Adverse Effect
unless and until the aggregate amount of the liability for all Claims for which
Claim Notices are delivered by Purchasers pursuant thereto exceeds one percent
(1%) of the Purchase Price, and then only to the extent such damages exceed such
one percent (1%) of the Purchase Price.
(d) Purchasers
shall not have any liability for any indemnification under Section 11.4(b)(iv) for any
representation or warranty that is not qualified by material adverse effect
unless and until the aggregate amount of the liability for all Claims for which
Claim Notices are delivered by Seller pursuant thereto exceeds one percent (1%)
of the Purchase Price, and then only to the extent such damages exceed such one
percent (1%) of the Purchase Price.
(e) Notwithstanding
anything to the contrary contained elsewhere in this Agreement, Seller shall not
be required to indemnify Purchasers under Section 11.4(c)(i) for
aggregate damages in excess of an amount equal to eighteen percent (18%) of the
Purchase Price.
|
Section
11.8
|
Disclaimers.
|
(a) EXCEPT AS AND TO THE EXTENT EXPRESSLY
SET FORTH IN ARTICLE 5 OF THIS AGREEMENT OR CONFIRMED IN THE CERTIFICATE OF
SELLER TO BE DELIVERED PURSUANT TO SECTION 9.2(b), (I) SELLER MAKES NO
REPRESENTATIONS OR WARRANTIES, EXPRESS, STATUTORY OR IMPLIED, AND
(II) SELLER EXPRESSLY DISCLAIMS ALL LIABILITY AND RESPONSIBILITY FOR ANY
REPRESENTATION, WARRANTY, STATEMENT OR INFORMATION MADE OR COMMUNICATED (ORALLY
OR IN WRITING) TO PURCHASERS OR ANY OF THEIR RESPECTIVE AFFILIATES, EMPLOYEES,
AGENTS, CONSULTANTS OR REPRESENTATIVES (INCLUDING, WITHOUT LIMITATION, ANY
OPINION, INFORMATION, PROJECTION OR ADVICE THAT MAY HAVE BEEN PROVIDED TO
PURCHASERS BY ANY OFFICER, DIRECTOR, EMPLOYEE, AGENT, CONSULTANT, REPRESENTATIVE
OR ADVISOR OF SELLER OR ANY OF THEIR AFFILIATES).
(b) EXCEPT AS EXPRESSLY REPRESENTED
OTHERWISE IN ARTICLE 5 OF THIS AGREEMENT OR CONFIRMED IN THE CERTIFICATE OF
SELLER TO BE DELIVERED PURSUANT TO SECTION 9.2(b), AND WITHOUT LIMITING
THE
29
GENERALITY OF THE FOREGOING, SELLER
EXPRESSLY DISCLAIMS ANY REPRESENTATION OR WARRANTY, EXPRESS, STATUTORY OR
IMPLIED, AS TO (I) TITLE TO ANY OF THE ASSETS, (II) THE CONTENTS,
CHARACTER OR NATURE OF ANY DESCRIPTIVE MEMORANDUM OR ANY REPORT OF ANY PETROLEUM
ENGINEERING CONSULTANT, OR ANY GEOLOGICAL OR SEISMIC DATA OR INTERPRETATION,
RELATING TO THE ASSETS, (III) THE QUANTITY, QUALITY
OR RECOVERABILITY OF PETROLEUM SUBSTANCES IN OR FROM THE ASSETS,
(IV) ANY ESTIMATES OF THE VALUE OF THE ASSETS OR FUTURE REVENUES GENERATED
BY THE ASSETS, (V) THE MAINTENANCE, REPAIR, CONDITION, QUALITY,
SUITABILITY, DESIGN OR MARKETABILITY OF THE ASSETS, (VI) THE CONTENT,
CHARACTER OR NATURE OF ANY DESCRIPTIVE MEMORANDUM, REPORTS, BROCHURES, CHARTS OR
STATEMENTS PREPARED BY THIRD PARTIES, (VII) ANY OTHER MATERIALS OR INFORMATION
THAT MAY HAVE BEEN MADE AVAILABLE OR COMMUNICATED TO PURCHASERS OR THEIR
RESPECTIVE AFFILIATES, OR TO THE EMPLOYEES, AGENTS, CONSULTANTS, REPRESENTATIVES
OR ADVISORS OF EITHER OF PURCHASERS OR OF THEIR RESPECTIVE AFFILIATES IN
CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY
DISCUSSION OR PRESENTATION RELATING THERETO, AND FURTHER DISCLAIMS ANY
REPRESENTATION OR WARRANTY, EXPRESS, STATUTORY OR IMPLIED, OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE OR CONFORMITY TO MODELS OR SAMPLES OF MATERIALS
OF ANY EQUIPMENT, IT BEING EXPRESSLY UNDERSTOOD AND AGREED BY THE PARTIES HERETO
THAT, EXCEPT TO THE EXTENT EXPRESSLY SET FORTH IN ARTICLE 5 OF THIS AGREEMENT OR
CONFIRMED IN THE CERTIFICATE OF SELLER TO BE DELIVERED PURSUANT TO SECTION
9.2(b), PURCHASERS SHALL BE DEEMED TO BE OBTAINING THE ASSETS IN THEIR PRESENT
STATUS, CONDITION AND STATE OF REPAIR, “AS IS” AND “WHERE IS” WITH ALL FAULTS,
AND (VIII) ANY IMPLIED OR EXPRESS WARRANTY OF FREEDOM FROM PATENT OR TRADEMARK
INFRINGEMENT.
(c) EXCEPT TO THE EXTENT EXPRESSLY
PROVIDED IN THIS AGREEMENT OR CONFIRMED IN THE CERTIFICATE OF SELLER TO BE
DELIVERED PURSUANT TO SECTION 9.2(b), SELLER HAS NOT AND WILL NOT MAKE ANY
REPRESENTATION OR WARRANTY REGARDING ANY MATTER OR CIRCUMSTANCE RELATING TO
ENVIRONMENTAL
LAWS, ENVIRONMENTAL LIABILITIES, THE RELEASE OF MATERIALS INTO THE ENVIRONMENT
OR THE PROTECTION OF HUMAN HEALTH, SAFETY, NATURAL RESOURCES OR THE ENVIRONMENT,
OR ANY OTHER ENVIRONMENTAL CONDITION OF THE ASSETS, AND, EXCEPT TO THE EXTENT
EXPRESSLY PROVIDED IN THIS AGREEMENT, (i) NOTHING IN THIS AGREEMENT OR OTHERWISE
SHALL BE CONSTRUED AS SUCH A REPRESENTATION OR WARRANTY, AND (ii) PURCHASERS
SHALL BE DEEMED TO BE TAKING THE ASSETS “AS IS” AND “WHERE IS” FOR PURPOSES OF
THEIR ENVIRONMENTAL CONDITION.
|
Section
11.9
|
Waiver of Trade
Practices Acts.
|
Purchasers
hereby acknowledge the inapplicability of the Texas Deceptive Trade
Practices--Consumer Protection Act, Tex. Bus. & Com. Code Ann.
§ 17.41 et seq. (the “DTPA”) to this transaction and hereby waives any and
all duties, rights or remedies that might be imposed by the DTPA, whether such
duties, rights and remedies are applied directly by the DTPA itself or
indirectly in connection with other statutes.
30
|
Section
11.10
|
Recording. |
As soon
as practicable after Closing, Purchasers shall record the Conveyance in the
appropriate counties and provide Seller with copies of all recorded or approved
instruments.
The
conveyance in the form attached as Exhibit B is intended to
convey all of the Assets being conveyed pursuant to this
Agreement. Specific portions of the Assets that are leased from, or
require the approval to transfer by, a governmental entity are conveyed under
the Conveyance and also are described and covered by other separate assignments
made by Seller to Cowtown on officially approved forms, or forms acceptable to
such entity, in sufficient multiple originals to satisfy applicable statutory
and regulatory requirements. The interests conveyed by such
separate assignments are the same, and not in addition to, the interests
conveyed in the Conveyance attached as Exhibit B. Further, such
assignments shall be deemed to contain all of the exceptions, reservations,
rights, titles, power and privileges set forth herein and in the Conveyance as
fully and only to the extent as though they were set forth in each such separate
assignment.
ARTICLE
12
MISCELLANEOUS
|
Section
12.1
|
Counterparts.
|
This
Agreement may be executed in counterparts, each of which shall be deemed an
original instrument, but all such counterparts together shall constitute but one
agreement.
|
Section
12.2
|
Notice.
|
All
notices that are required or may be given pursuant to this Agreement shall be
sufficient in all respects if given in writing and delivered personally, by
telecopy or by registered or certified mail, postage prepaid, as
follows:
If
to Seller:
|
Cowtown
Pipeline L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: John
C. Regan
Telephone:
(817) 665-4837
Telecopy:
(817)
665-5007
|
With
a copy to
(which
shall not
itself
constitute
notice):
|
Cowtown
Pipeline L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: John
C. Cirone
Telephone: (817)
665-4939
Telecopy: (817)
665-5021
|
31
If
to Purchasers:
|
Quicksilver
Gas Services LP
Cowtown
Pipeline Partners L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: Philip
Cook
Telephone:
(817) 665-4833
Telecopy: (817)
665-5004
|
With
a copy to
(which
shall not
itself
constitute
notice):
|
Quicksilver
Gas Services LP
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: John
C. Cirone
Telephone: (817)
665-4939
Telecopy: (817)
665-5021
and
Quicksilver
Gas Services LP
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: Conflicts
Committee Chairman
Telephone: (817)
807-0918
|
Either
Seller or Purchasers may change its address for notice by notice to Seller or
Purchasers, as applicable, in the manner set forth above. All notices
shall be deemed to have been duly given at the time of receipt by the party to
which such notice is addressed.
|
Section
12.3
|
Sales or Use Tax
Recording Fees and Similar Taxes and
Fees.
|
Purchasers
shall bear any sales, use, excise, real property transfer or gain, gross
receipts, goods and services, registration, capital, documentary, stamp or
transfer Taxes, recording fees and similar Taxes and fees incurred and imposed
upon, or with respect to, the property transfers or other transactions
contemplated hereby. Seller will determine, and Purchasers agree to
cooperate with Seller in determining, sales tax, if any, that is due in
connection
with the sale of Assets, and Purchasers agree to pay any such tax to Seller at
Closing. If such transfers or transactions are exempt from any such
Taxes or fees upon the filing of an appropriate certificate or other evidence of
exemption, Purchasers will timely furnish to Seller such certificate or
evidence.
|
Section
12.4
|
Expenses.
|
Except as
provided in Section
12.3, all expenses incurred by Seller in connection with or related to
the authorization, preparation or execution of this Agreement, the Conveyance
delivered hereunder and the Exhibits and Schedules hereto and thereto, and all
other matters related to the Closing, including, without limitation, all fees
and expenses of counsel, accountants and financial advisers employed by Seller,
shall be borne solely and entirely by Seller, and all such expenses incurred by
Purchasers shall be borne solely and entirely by Purchasers.
32
|
Section
12.5
|
Change of
Name.
|
As
promptly as practicable, but in any case within ninety (90) days after the
Closing Date, Purchasers shall eliminate the names “Cowtown Pipeline L.P.” and
“Quicksilver Resources Inc.” from the Assets acquired pursuant to this Agreement
and, except with respect to such grace period for eliminating existing usage,
shall have no right to use any logos, trademarks or trade names belonging to
Seller or any of its Affiliates.
|
Section
12.6
|
Replacement of Bonds,
Letters of Credit and
Guarantees.
|
The
parties understand that none of the bonds, letters of credit and
guarantees, if any, posted by Seller with Governmental Bodies and relating to
the Assets may be transferable to Purchasers. Promptly following
Closing, Seller shall provide Purchasers with reasonable assistance in
obtaining, or causing to be obtained in the name of either of Purchasers and at
Purchasers’ sole cost and expense, replacements for such bonds, letters of
credit and guarantees, to the extent such replacements are necessary to permit
the cancellation of the bonds, letters of credit and guarantees posted by Seller
or to consummate the transactions contemplated by this Agreement.
|
Section
12.7
|
Governing Law and
Venue.
|
THIS
AGREEMENT AND THE LEGAL RELATIONS BETWEEN THE PARTIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS OTHERWISE APPLICABLE TO SUCH
DETERMINATIONS. JURISDICTION AND VENUE WITH RESPECT TO ANY DISPUTES
ARISING HEREUNDER SHALL BE PROPER ONLY IN TARRANT COUNTY, TEXAS.
|
Section
12.8
|
Captions.
|
The
captions in this Agreement are for convenience only and shall not be considered
a part of or affect the construction or interpretation of any provision of this
Agreement.
|
Section
12.9
|
Waivers.
|
Any
failure by any party or parties to comply with any of its or their obligations,
agreements or conditions herein contained may be waived in writing, but not in
any other manner, by the party or parties to whom such compliance is owed. No
waiver of, or consent to a change in, any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of, or consent to a change in,
other provisions hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
|
Section
12.10
|
Assignment.
|
No party
shall assign all or any part of this Agreement, nor shall any party assign or
delegate any of its rights or duties hereunder, without the prior written
consent of the other party, and any assignment or delegation made without such
consent shall be void. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns.
33
|
Section
12.11
|
Entire
Agreement.
|
This
Agreement, the Exhibits and Schedules attached hereto and the documents to be
executed hereunder constitute the entire agreement between the parties
pertaining to the subject matter hereof, and supersede all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties pertaining to the subject matter hereof.
|
Section
12.12
|
Amendment.
|
(a) This
Agreement may be amended or modified only by an agreement in writing executed by
all parties.
(b) No
waiver of any right under this Agreement shall be binding unless executed in
writing by the party to be bound thereby.
|
Section
12.13
|
No Third-Party
Beneficiaries.
|
Nothing
in this Agreement shall entitle any Person other than Purchasers and Seller to
any Claim, remedy or right of any kind, except as to those rights expressly
provided to Seller Indemnitees or the Purchaser Indemnitees (provided, however,
any claim for indemnity hereunder on behalf of a Seller Indemnitee or a
Purchaser Indemnitee must be made and administered by a party to this
Agreement).
|
Section
12.14
|
References. |
In this
Agreement:
(a) References
to any gender include a reference to all other genders;
(b) References
to the singular include the plural, and vice versa;
(c) Unless
expressly provided to the contrary, a reference to any Article or Section means
an Article or Section of this Agreement;
(d) Unless
expressly provided to the contrary, reference to any Exhibit or Schedule means
an Exhibit or Schedule to this Agreement, all of which are incorporated into and
made a part of this Agreement;
(e) Unless
expressly provided to the contrary, “hereunder,” “hereof,” “herein” and words of
similar import are references to this Agreement as a whole and not any
particular Section or other provision of this Agreement; and
(f) “Include”
and “including” shall mean include or including without limiting the generality
of the description preceding such term.
|
Section
12.15
|
Construction. |
Each of
Seller and Purchasers has had substantial input into the drafting and
preparation of this Agreement and has had the opportunity to exercise business
discretion in relation to the negotiation of the details of the transactions
contemplated hereby. This Agreement is the result of arm’s-length negotiations
from equal bargaining positions. In the
34
event of
a dispute over the meaning or application of this Agreement, it shall be
construed fairly and reasonably and neither more strongly for nor against either
party.
|
Section
12.16
|
Limitation on Damages |
Notwithstanding
any other provision contained elsewhere in this Agreement to the contrary, the
parties acknowledge that this Agreement does not authorize one party to sue for
or collect from the other party its punitive damages or its consequential or
indirect damages in connection with this Agreement and the transactions
contemplated hereby, and each of Seller and Purchasers expressly waive for
themselves and on behalf of their respective Affiliates any and all Claims it
may have against the other party or parties, as applicable, for such damages in
connection with this Agreement and the transactions contemplated
hereby.
|
Section
12.17
|
Conspicuousness. |
The
parties agree that provisions in this Agreement in “bold” type satisfy any
requirements of the “express negligence rule” and any other requirements at law
or in equity that provisions be conspicuously marked or
highlighted.
|
Section
12.18
|
Severability. |
If any
term or other provision of this Agreement is held invalid, illegal or incapable
of being enforced under any rule of law, all other conditions and provisions of
this Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in a materially adverse manner with respect to either Seller or
Purchasers.
|
Section
12.19
|
Time of Essence. |
Time is
of the essence in this Agreement. If the date specified in this
Agreement for giving any notice or taking any action is not a Business Day (or
if the period during which any notice is required to be given or any action
taken expires on a date which is not a Business Day), then the date for giving
such notice or taking such action (and the expiration date of such period
during which notice is required to be given or action taken) shall be the next
day which is a Business Day.
|
Section
12.20
|
Certain Actions by
Purchasers.
|
Seller
acknowledges and agrees that any (i) amendment or modification to this
Agreement, (ii) waiver by Purchasers of any of Purchasers’ conditions to Closing
or (iii) amendment or modification to the QRI GGA, shall require the approval of
the Conflicts Committee.
[SIGNATURES BEGIN ON THE
FOLLOWING PAGE]
35
IN
WITNESS WHEREOF, this Agreement has been signed by each of the parties hereto on
the date first above written.
PURCHASERS: | ||||
QUICKSILVER
GAS SERVICES LP
|
||||
By:
|
Quicksilver
Gas Services GP LLC,
|
|||
its
General Partner
|
||||
By: | /s/ Thomas F. Darden | |||
Name: | Thomas F. Darden | |||
Title: | President and Chief Executive Officer | |||
COWTOWN PIPELINE PARTNERS L.P. | ||||
By: |
Quicksilver
Gas Services Operating GP LLC,
|
|||
its
General Partner
|
||||
By: | /s/ Thomas F. Darden | |||
Name: | Thomas F. Darden | |||
Title: | President and Chief Executive Officer | |||
SELLER: | ||||
COWTOWN
PIPELINE L.P.
|
||||
By:
|
Cowtown
Pipeline Management, Inc.,
|
|||
its
General Partner
|
||||
By: | /s/ Glenn Darden | |||
Name: | Glenn Darden | |||
Title: | President and Chief Executive Officer |
EXHIBIT
B
Attached
to and made part of that certain
Purchase
and Sale Agreement executed on December 10, 2009,
by and
among Cowtown Pipeline L.P., as "Seller", and
Quicksilver
Gas Services LP and Cowtown Pipeline Partners L.P., as "Purchasers"
ASSIGNMENT
AND BILL OF SALE
This
Assignment and Bill of Sale (this "Conveyance") by and between Cowtown
Pipeline L.P., a Texas limited partnership ("Grantor"), and Cowtown
Pipeline Partners L.P., a Texas limited partnership ("Grantee"), is dated
this [___] day of December, 2009 but
effective as of 7:00 a.m., Central Standard
Time, on December 1, 2009 (the "Effective Time").
Reference
is made to the Purchase and Sale Agreement more particularly described in Section 4.2. All
capitalized terms used but not otherwise defined herein shall have the meaning
ascribed thereto in the Purchase and Sale Agreement.
ARTICLE
1
Conveyance of
Assets
Section
1.1 Conveyance:
Grantor, in consideration of the premises and the promises, covenants and
agreements contained herein, and for other good and valuable consideration, in
hand paid, the receipt and sufficiency of which are hereby acknowledged, hereby
grants, bargains, sells, and conveys unto Grantee, all of Grantor's right,
title, interest and estate, real or personal, in and to the following, excepting
the Excluded Assets (collectively the "Assets"):
(a) The
portion of the natural gas gathering system that is depicted in green on the map
attached hereto as Exhibit
A together with all appurtenances thereto; provided, however, that such
system and appurtenances shall not include any pipelines, equipment or other
properties that are located upstream of the inlet flange of the meters where
Hydrocarbons are delivered into the pipelines consisting of such natural gas
gathering system (subject to such exclusions, the "System");
(b) All
contracts, agreements and instruments by which the other Assets are bound, or
that relate to or are otherwise applicable to the other Assets, including those
identified on Schedule 1.2(b) attached to the Purchase and Sale Agreement, but
excluding any such contracts, agreements and instruments to the extent transfer
is restricted by third-party agreement or applicable Law and the necessary
consents to transfer are not obtained pursuant to Section 7.7 of the Purchase
and Sale Agreement and provided that such contracts, agreements and instruments
shall not include the instruments constituting the Surface Contracts (as defined
in Section
1.1(c));
(c) All
easements, permits, licenses, servitudes, rights-of-way, surface leases, fee
interests in real property and other surface rights appurtenant to, and used or
held for use primarily in connection with the System (including those identified
on Schedule 1.1(c))
("Surface Contracts"), but excluding any such easements, permits, licenses,
servitudes, rights-of-way, surface leases, fee interests in real property and
other such rights to the extent transfer is restricted by third party agreement
or applicable Law and necessary consents to transfer are not obtained pursuant
to Section 7.7 of the Purchase and Sale Agreement;
(d) All
equipment, machinery, fixtures and other tangible personal property and
improvements located on or constituting a part of the System and used or held
for use primarily in connection with the operation of the System ("Equipment"),
and that certain 2001 Ford F250, vehicle identification number
1FTNX20L31EA87453;
(e) All
flow lines, pipelines, gathering systems, meters and appurtenances thereto
constituting a part of the System or used, or held for use, primarily in
connection with the operation of the System, including in each case those
identified on Schedule
1.1(e) ("Pipelines");
(f) That
certain treating facility located on that certain 69.03 acre tract of land more
specifically described in the instrument set forth in item A1 of Schedule 1.1(c), together with
all compressors, dehydration and amine units, tanks, machinery and equipment
appurtenant and relating exclusively to such treating facility (the "Facility");
and
(g) All
land files; gas contract files; gas gathering and processing files; abstracts;
title opinions; land surveys; maps; engineering data and reports; reserve or
volume data provided by any third party in connection with the negotiation of
any gas gathering agreement that constitutes a Material Contract; other books,
records, data, files and accounting records, in each case to the extent related
primarily to the Assets, or used or held for use primarily in connection with
the maintenance or operation thereof; and all computer or communications
software used in connection with monitoring and running the Facility, but
excluding (i) any books, records, data, files, maps and accounting records
to the extent disclosure or transfer is restricted by third-party agreement or
applicable Law and the necessary consents to transfer are not obtained pursuant
to Section 7.7 of the Purchase and Sale Agreement, (ii) computer or
communications software that is not used in connection with monitoring and
running the Facility or intellectual property (including tapes, codes, data and
program documentation and all manifestations and technical information relating
thereto), (iii) attorney-client privileged communications and work product of
Grantor's legal counsel (other than title opinions), (iv) except to the extent
constituting reserve or volume data described above in this Section 1.1(g), reserve
studies and evaluations, and (v) records relating to the negotiation and
consummation of the sale of the Assets (subject to such exclusions, the
"Records").
Section
1.2 Excluded
Assets: Notwithstanding the
foregoing, the Assets shall not include, and there is excepted, reserved and
excluded from the purchase and sale contemplated hereby (collectively, the
"Excluded Assets"):
(a) All
corporate, financial, income and franchise tax and legal records of Grantor that
relate to Grantor's business generally (whether or not relating to the Assets),
and all books, records and files that relate to the Excluded Assets and those
records retained by Grantor pursuant to Section 1.1(g) and copies of
any other Records retained by Grantor pursuant to Section 1.5 of the Purchase
and Sale Agreement;
(b) Except to
the extent expressly constituting a portion of the Records, all geological and
geophysical data (including all seismic data, including reprocessed data) and
all logs, interpretive data, technical evaluations, technical outputs, reserve
estimates and economic estimates;
(c) Other
than any CoServ Reimbursement, all rights to any refund of Taxes or other costs
or expenses borne by Grantor or Grantor's predecessors in interest and title
attributable to periods prior to the Effective Time;
(d) Grantor's
area-wide bonds, permits and licenses or other permits, licenses or
authorizations used in the conduct of Grantor's business generally;
(e) Those
items listed in Schedule
1.2(e);
(f) All trade
credits, account receivables, note receivables, and other receivables
attributable to the Assets with respect to any period of time prior to the
Effective Time;
(g) Except to
the extent expressly described in Section 1.1(d), all right,
title and interest of Grantor in and to vehicles used primarily in connection
with the Assets;
(h) All
rights, titles, claims and interests of Grantor or any Affiliate of Grantor (i)
to or under any policy or agreement of insurance or any insurance proceeds to
the extent attributable to the period prior to the Effective Time, and (ii) to
or under any bond or bond proceeds;
(i) Any
patent, patent application, logo, service mark, copyright, trade name or
trademark of or associated with Grantor or any Affiliate of Grantor or any
business of Grantor or of any Affiliate of Grantor;
(j) All
easements and rights-of-way listed in Schedule 1.2(j), together
with all flow lines, pipelines, equipment, machinery, fixtures and other
tangible personal property and improvements located thereon or related thereto;
and
(k) Any
pipelines, equipment or other properties that are located upstream of the inlet
flange of the meters where Hydrocarbons are delivered into the
Pipelines.
TO HAVE
AND TO HOLD the Assets unto Grantee, its successors and assigns, forever,
subject, however, to the terms and conditions of this Conveyance.
ARTICLE
2
Limited Warranty and
Disclaimers
As of the
Closing Date, Grantor warrants to Grantee that it has Defensible Title to the
easements, rights-of-way, surface leases and fee interests in real property
identified on Schedule
1.1(c) against all persons claiming or to claim the same or any part
thereof by, through or under Grantor, but not otherwise.
Except
for the limited warranty set forth in this Article 2 and the representation and
warranty set forth in Section 5.21 of the Purchase and Sale Agreement, Grantor
makes no representation or warranty, express, implied, statutory or otherwise,
with respect to Grantor's title to any of the Assets. Grantor hereby
assigns to Grantee all rights of substitution and subrogation in and to all of
the rights, claims, and causes of action on warranties given or made by any
predecessor (other than an Affiliate) of Grantor, to the extent Grantor may
legally transfer such rights.
EXCEPT AS AND TO THE EXTENT EXPRESSLY
SET FORTH IN ARTICLE 5 OF THE PURCHASE AND SALE AGREEMENT, CONFIRMED IN THE
CERTIFICATE OF GRANTOR DELIVERED TO GRANTEE AND KGS ON EVEN DATE HEREWITH
PURSUANT TO SECTION 9.2(b) OF THE PURCHASE AND SALE AGREEMENT, OR IN ARTICLE 2
OF THIS CONVEYANCE (I) GRANTOR MAKES NO REPRESENTATIONS OR WARRANTIES,
EXPRESS, STATUTORY OR IMPLIED, AND (II) GRANTOR EXPRESSLY DISCLAIMS ALL
LIABILITY AND RESPONSIBILITY FOR ANY REPRESENTATION, WARRANTY, STATEMENT OR
INFORMATION MADE OR COMMUNICATED (ORALLY OR IN WRITING) TO GRANTEE OR ANY OF ITS
AFFILIATES, EMPLOYEES, AGENTS, CONSULTANTS OR REPRESENTATIVES (INCLUDING,
WITHOUT LIMITATION, ANY OPINION, INFORMATION, PROJECTION OR ADVICE THAT MAY HAVE
BEEN PROVIDED TO GRANTEE BY ANY OFFICER, DIRECTOR, EMPLOYEE, AGENT, CONSULTANT,
REPRESENTATIVE OR ADVISOR OF GRANTOR OR ANY OF THEIR AFFILIATES).
EXCEPT AS EXPRESSLY REPRESENTED
OTHERWISE IN ARTICLE 5 OF THE PURCHASE AND SALE AGREEMENT, CONFIRMED IN THE
CERTIFICATE OF GRANTOR DELIVERED TO GRANTEE AND KGS ON EVEN DATE HEREWITH
PURSUANT TO SECTION 9.2(b) OF THE PURCHASE AND SALE AGREEMENT, OR IN ARTICLE 2
OF THIS CONVEYANCE, AND WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
GRANTOR EXPRESSLY DISCLAIMS ANY REPRESENTATION OR WARRANTY, EXPRESS, STATUTORY
OR IMPLIED, AS TO (I) TITLE TO ANY OF THE ASSETS, (II) THE CONTENTS,
CHARACTER OR NATURE OF ANY DESCRIPTIVE MEMORANDUM OR ANY REPORT OF ANY PETROLEUM
ENGINEERING CONSULTANT, OR ANY GEOLOGICAL OR SEISMIC DATA OR INTERPRETATION,
RELATING TO THE ASSETS, (III) THE QUANTITY, QUALITY OR RECOVERABILITY OF
PETROLEUM SUBSTANCES IN OR FROM THE ASSETS, (IV) ANY ESTIMATES OF THE VALUE
OF THE ASSETS OR FUTURE REVENUES GENERATED BY THE ASSETS, (V) THE
MAINTENANCE, REPAIR, CONDITION, QUALITY, SUITABILITY, DESIGN OR MARKETABILITY OF
THE ASSETS, (VI) THE CONTENT, CHARACTER OR NATURE OF ANY DESCRIPTIVE
MEMORANDUM, REPORTS, BROCHURES, CHARTS OR STATEMENTS PREPARED BY THIRD PARTIES,
(VII) ANY OTHER MATERIALS OR INFORMATION THAT MAY HAVE BEEN MADE AVAILABLE OR
COMMUNICATED TO GRANTEE OR ITS AFFILIATES, OR TO ITS OR THEIR EMPLOYEES, AGENTS,
CONSULTANTS, REPRESENTATIVES OR ADVISORS IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED BY THE PURCHASE AND SALE AGREEMENT OR ANY DISCUSSION OR
PRESENTATION RELATING THERETO, AND FURTHER DISCLAIMS ANY REPRESENTATION OR
WARRANTY, EXPRESS, STATUTORY OR IMPLIED, OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR CONFORMITY TO MODELS OR SAMPLES OF MATERIALS OF ANY
EQUIPMENT, IT BEING EXPRESSLY UNDERSTOOD AND AGREED BY THE PARTIES HERETO THAT,
EXCEPT TO THE EXTENT EXPRESSLY SET FORTH IN ARTICLE 5 OF THE PURCHASE AND SALE
AGREEMENT OR CONFIRMED IN THE CERTIFICATE OF GRANTOR DELIVERED TO GRANTEE AND
KGS ON EVEN DATE HEREWITH, GRANTEE IS DEEMED TO BE OBTAINING THE ASSETS IN THEIR
PRESENT STATUS, CONDITION AND STATE OF REPAIR, “AS IS” AND “WHERE IS” WITH ALL
FAULTS, AND (VIII) ANY IMPLIED OR EXPRESS WARRANTY OF FREEDOM FROM PATENT
OR TRADEMARK INFRINGEMENT.
EXCEPT TO THE EXTENT EXPRESSLY PROVIDED
IN THE PURCHASE AND SALE AGREEMENT OR CONFIRMED IN THE CERTIFICATE OF GRANTOR
DELIVERED TO GRANTEE ON EVEN DATE HEREWITH PURSUANT TO SECTION 9.2(b) OF THE
PURCHASE AND SALE AGREEMENT, GRANTOR HAS NOT AND WILL NOT MAKE ANY
REPRESENTATION OR WARRANTY REGARDING ANY MATTER OR CIRCUMSTANCE RELATING TO
ENVIRONMENTAL LAWS, ENVIRONMENTAL LIABILITIES, THE RELEASE OF MATERIALS INTO THE
ENVIRONMENT OR THE PROTECTION OF HUMAN HEALTH, SAFETY, NATURAL RESOURCES OR THE
ENVIRONMENT, OR ANY OTHER ENVIRONMENTAL CONDITION OF THE ASSETS, AND, EXCEPT TO
THE EXTENT EXPRESSLY PROVIDED IN THE PURCHASE AND SALE AGREEMENT, (i) NOTHING IN
THE PURCHASE AND SALE AGREEMENT OR OTHERWISE SHALL BE CONSTRUED AS SUCH A
REPRESENTATION OR WARRANTY, AND (ii) GRANTEE SHALL BE DEEMED TO BE TAKING THE
ASSETS “AS IS” AND “WHERE IS” FOR PURPOSES OF THEIR ENVIRONMENTAL
CONDITION.
ARTICLE
3
Assumption of
Obligations
Section
3.1 Assumed
Seller Obligations: Without limiting Grantee’s rights to indemnity under
Section 11.4(c) of the Purchase and Sale Agreement and subject to the
limitations set forth in Section 11.7 therein, effective on the date of this
Conveyance, Grantee assumes and agrees to fulfill, perform, pay and discharge
the Assumed Seller Obligations.
Section
3.2 NORM: Grantee
acknowledges that the Assets have been used for the gathering and transportation
of Hydrocarbons and that there may be petroleum, produced water, wastes or other
substances or materials located in, on or under the System or associated with
the Assets. Equipment and sites included in the Assets may contain
asbestos, hazardous substances or NORM. NORM may affix or attach
itself to the inside of pipes, materials, and equipment as scale or in other
forms. The pipes, materials and equipment (including, without
limitation, the Equipment) included in the Assets may contain NORM and other
wastes or hazardous substances. NORM-containing material and/or other
wastes or hazardous substances may have come in contact with various
environmental media, including, without limitation, water, soils or
sediment. Special procedures may be required for the assessment,
remediation, removal, transportation or disposal of environmental media, wastes,
asbestos, hazardous substances and NORM from the Assets.
ARTICLE
4
Miscellaneous
Section
4.1 Further
Assurances: After Closing, without further consideration, Grantor and
Grantee each agree to take such further actions and to execute, acknowledge and
deliver all such further documents as are reasonably requested by the other
party for carrying out the purposes of this Conveyance.
Section
4.2 Conveyance
Subject to Purchase and Sale Agreement: This Conveyance is expressly
subject to the terms and conditions of that certain Purchase and Sale Agreement
by and between Cowtown Pipeline L.P., as "Seller", and Quicksilver Gas Services
LP ("KGS") and Cowtown Pipeline Partners L.P., as "Purchasers", executed on
December 10, 2009 (the "Purchase and Sale Agreement"). If there is a
conflict between the terms of this Conveyance and the Purchase and Sale
Agreement, the terms of the Purchase and Sale Agreement shall
control.
Section
4.3 Successors
and Assigns: This Conveyance shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns.
Section
4.4 Titles
and Captions: All article or section titles or captions in this
Conveyance are for convenience only, shall not be deemed part of this Conveyance
and in no way define, limit, extend, or describe the scope or intent of any
provisions hereof. Except to the extent otherwise stated in this
Conveyance, references to “Articles” and “Sections” are to Articles and Sections
of this Conveyance, and references to "Exhibits" and “Schedules” are to Exhibits
and Schedules attached to this Conveyance, which are made parts hereof for all
purposes.
Section
4.5 Filings: As
a matter of convenience and not as a limitation to the Assets transferred by
this Conveyance, the parties hereto may file counterparts of this Conveyance
that only include the descriptions of those Assets that are located in the
jurisdiction where such Conveyance is filed. A fully-executed
original of this Conveyance (including the descriptions of all Assets
transferred by this Conveyance) shall be maintained at the offices of
Grantee.
Section
4.6 Governing
Law: This Conveyance and the rights of the parties hereunder
shall be governed by, and construed in accordance with, the laws of the State of
Texas without regard to principles of conflicts of laws otherwise applicable to
such determinations.
Section
4.7 Counterparts: This
Conveyance may be executed in counterparts, each of which shall be deemed an
original instrument, but all such counterparts together shall constitute but one
instrument.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the undersigned hereby execute this Conveyance to be effective
as of the Effective Time.
GRANTOR:
|
||||
COWTOWN
PIPELINE L.P.
|
||||
By:
|
Cowtown
Pipeline Management, Inc.,
|
|||
Its
General Partner
|
||||
By: | ||||
Name: | ||||
Title: |
GRANTEE:
|
||||
COWTOWN
PIPELINE PARTNERS L.P.,
|
||||
By:
|
Quicksilver
Gas Services Operating GP LLC,
|
|||
Its
General Partner
|
||||
By: | ||||
Name: | ||||
Title: |
STATE OF TEXAS | § |
§ | |
COUNTY OF TARRANT | § |
This instrument was acknowledged before
me on the _____ day of December, 2009, by __________, ____________ of Cowtown
Pipeline Management, Inc., a Texas corporation, General Partner of Cowtown
Pipeline L.P., a Texas limited partnership, on behalf of said limited
partnership.
(Seal/Stamp) | |
Notary Public, State of Texas |
STATE OF TEXAS | § |
§ | |
COUNTY OF TARRANT | § |
This instrument was acknowledged before
me on the _____ day of December, 2009, by ___________, ____________ of
Quicksilver Gas Services Operating GP LLC, a Delaware limited liability company,
the General Partner of Cowtown Pipeline Partners L.P., a Texas limited
partnership, on behalf of said limited partnership.
(Seal/Stamp) | |
Notary Public, State of Texas |
EXHIBIT
C
Attached
to and made part of that certain
Purchase
and Sale Agreement executed on December 10, 2009,
by
and among Cowtown Pipeline L.P., as "Seller", and
Quicksilver
Gas Services LP and Cowtown Pipeline Partners L.P., as "Purchasers"
LEASE
AGREEMENT
THIS
LEASE AGREEMENT (this "Lease") is made and
entered into as of this [__]day of December, 2009, and
effective as of 7:00 a.m., Central Standard
Time, on December 1, 2009 (the "Effective Time") by
and between Cowtown
Pipeline L.P., a Texas limited partnership ("Lessor"), and Cowtown
Pipeline Partners L.P., a Texas limited partnership ("Lessee").
W I T N E
S S E T H:
WHEREAS,
Lessor, as "Seller", and Quicksilver Gas Services LP and Lessee, as
"Purchasers", entered into that certain Purchase and Sale Agreement on December
10, 2009 (the "Purchase
Agreement");
WHEREAS,
pursuant to the terms of the Purchase Agreement, (a) the easements and
rights-of-way listed in Part I of Exhibit A (the "Group I Easements"),
(b) the easements and rights-of-way listed in Part II of Exhibit A (the "Group II Easements"),
and (c) all flow lines, pipelines, equipment, machinery, fixtures and other
tangible personal property and improvements located on and related to the Group
I Easements or the Group II Easements (collectively, the "Easement Assets"; the
Group I Easements, the Group II Easements and the Easement Assets being
hereinafter referred to collectively as the "Premises"), were in
each case retained by Lessor and not included in the Assets transferred and
conveyed to Lessee at Closing;
WHEREAS,
the parties hereto desire to enter into this Lease pursuant to the terms of the
Purchase Agreement to set forth the terms and conditions upon which Lessor
desires to lease the Premises to Lessee and Lessee desires to lease the Premises
from Lessor.
NOW,
THEREFORE, for and in consideration of the premises, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and of the mutual agreements hereinafter set forth, Lessor and
Lessee covenant and agree as follows:
ARTICLE
1
DEMISE OF PREMISES AND
TERM
Section
1.1 Demise of
Premises and Term. In consideration of the rents, covenants,
and agreements set forth herein and subject to the terms and conditions hereof,
Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, (a) the
Group I Easements and the Easement Assets located thereon and related thereto
for a term commencing at the Effective Time and ending at 11:59 p.m., Central Standard
Time, on December 29, 2011 (the "Group I Easement
Term") and (b) with respect to each Group II Easement and the Easement
Assets located thereon and related thereto, for a term commencing on the date of
this Lease and ending on the expiration of the term of such Group II Easement
(such term applicable to a Group II Easement and the Easement Assets located
thereon and related thereto being hereinafter called the "Group II Easement
Term"; together with the Group I Easement Term hereinafter referred to as
the "Term").
Section
1.2 Release
of Group I Easements and Easement Assets. The parties hereto
acknowledge that Lessee will be seeking to obtain new easements and
rights-of-way covering the lands covered by the Group I Easements (a "Replacement
Easement") from the respective owner or owners of such lands in order to
construct and lay a natural gas gathering line on such lands (the "Replacement
Line"). Once the Replacement Line has been installed on or
within the land covered by a Replacement Easement and such Replacement Line is
in service, Lessee shall promptly deliver to Lessor written notice thereof,
which notice shall identify (a) each Group I Easement (or portion thereof)
covered by such Replacement Easement and (b) the aggregate number of linear feet
of each pipeline attributable to each such Group I Easement that was leased by
Lessee pursuant hereto, and each such Group I Easement and the related Easement
Assets shall be released from the Premises and this Lease effective as of the
last day of the month following the month Lessor receives such written notice
and thereafter the Rent to be paid by Lessee shall be reduced by an amount equal
to the product of (i) $1.57 multiplied by (ii)
the aggregate number of linear feet of the pipelines attributable to each such
Group I Easement.
Section
1.3 Release
of Group II Easements and Easement Assets. In the event Lessor
obtains, complies with or otherwise satisfies all Transfer Requirements with
respect to a Group II Easement, such Group II Easement and the related Easement
Assets shall automatically be released from the Premises and this Lease
effective as of the Closing Date (as such term is defined in Section 7.7(b) of
the Purchase Agreement) applicable to such Group II Easement and related
Easement Assets.
ARTICLE
2
RENT
Section
2.1 Rent. As
rental for the Premises during the Term, Lessee agrees to pay to Lessor on or
before the last day of each month during the Term an amount equal to
$179,553.05 (the
"Rent"), which
amount shall be reduced from time to time in accordance with and pursuant to
Section 1.2; provided, however, that from
and after the expiration of the Group I Easement Term the Rent shall be equal to
$100 per annum to be paid by Lessee to Lessor on or before the last day of each
year during the remainder of the Term. All Rent to be paid by Lessee
to Lessor in this Lease shall be payable in lawful money of the United States of
America, at Lessor's address set forth in Section 11.5.
Section
2.2 Net
Lease. Except as herein otherwise expressly provided, this
Lease is a net lease and Lessor shall not at any time be required to pay any
charges or costs associated with the maintenance, repair, alteration or
improvement of the Premises or to provide any services or do any act or thing
with respect to the Premises or any part thereof or any appurtenances thereto,
and the Rent reserved herein shall be paid without any claim on the part of
Lessee for diminution, setoff or abatement and nothing shall suspend, abate or
reduce any Rent to be paid hereunder.
ARTICLE
3
CONDUCT OF
BUSINESS
Section
3.1 Use of
Premises. Lessee is accepting this Lease subject to the terms
of the Group I Easements and the Group II Easements and shall have the right to
use the portion of the Premises covered by each of such easements for the
purpose allowed thereby. Lessee shall use and operate the Premises in
accordance with the terms of the Group I Easements and Group II Easements, as
applicable.
Section
3.2 Governmental
Regulations. Lessee shall, at Lessee's sole cost and expense,
at all times comply with all applicable requirements (including, without
limitation, requirements under Environmental Laws) of all Governmental Bodies
now in force, or which may hereafter be in force, pertaining to this Lease or
the Premises, and shall faithfully observe all Laws now in force or which may
hereafter be in force pertaining to this Lease or the Premises or the use,
maintenance or operation of the Premises. Lessee shall give prompt
written notice to Lessor of Lessee's receipt from time to time of any notice of
non-compliance, order or other directive from any Governmental Body or other
Person relating to this Lease or the Premises.
Section
3.3 Payment
to Landowners. To the extent any of the Group I Easements or
Group II Easements require on-going payments by the holder of the benefit of the
right created thereby, Lessee shall make such on-going payments and, upon
request of Lessor from time to time, furnish to Lessor evidence of such
payment.
Section
3.4 Alterations. Except
as permitted in Section 4.1 or except to
the extent necessary to construct and lay the Replacement Line on the lands
covered by a Replacement Easement, Lessee shall not make any alteration,
addition, improvement or other change to the Premises without receiving Lessor's
prior written consent. Any alteration, addition, improvement or other
change to the Premises by Lessee which is permitted hereunder shall be made in a
good and workmanlike manner and in accordance with all applicable Laws and the
terms of the applicable Group I Easement or Group II Easement. Except
to the extent constituting a Replacement Line, any such alteration, addition,
improvement or other change shall at once become the property of Lessor and
shall be surrendered to Lessor upon termination of this Lease as to the affected
Group I Easements or, at Lessor's option exercisable by notice to Lessee,
disconnected and removed from such easements at Lessee's expense within sixty
(60) days after receiving such written notice from Lessor, which notice by
Lessor shall be given, if at all, no later than thirty (30) days prior to the
termination of this Lease as to such easements. Lessee shall not have
the right or power to create or permit any lien of any kind or character on the
Premises by reason of repair or construction or other work except such liens as
Lessee is contesting in good faith by appropriate actions. Except for
purposes of making repairs thereto pursuant to this Lease or as required by
applicable Law or by the terms of the applicable Group I Easement or Group II
Easement, Lessee shall not remove from the Premises any portion of the Easement
Assets without Lessor's prior written consent.
ARTICLE
4
MAINTENANCE OF
PREMISES
Section
4.1 Maintenance
by Lessee. Except as otherwise expressly provided in Article 7 with regard to
damage or destruction, Lessee shall at its sole cost, risk and expense at all
times keep the Premises in good order and repair and make all necessary repairs
thereto. When used in this Section
4.1, the term "repairs" shall include all necessary replacements,
renewals, alterations and additions. All repairs made by Lessee shall
be at least equal in quality and class to the original work and shall be made in
a good and workmanlike manner and in accordance with all applicable laws, rules,
regulations and other requirements of applicable Governmental Authorities having
jurisdiction.
Section
4.2 Lessor's
Access. Lessor and Lessor's authorized representatives shall
have the right to enter upon the Premises at all reasonable times for the
purposes of inspecting the same and determining whether the conditions and
covenants contained in this Lease are being kept and performed. Such
inspection and determination shall not unreasonably interfere with Lessee's
operation of the Premises. Lessor or its representatives shall abide
by all reasonable safety requirements of Lessee, and Lessor shall indemnify and
hold Lessee harmless from any damage or injury caused to the Premises, Lessee or
third parties as a result of Lessor carrying out such inspections.
Section
4.3 Surrender
of Premises. Lessee shall, (a) with respect to the Group I
Easements and the Easement Assets located thereon and related thereto, surrender
the same to Lessor in as good condition as it received the same, ordinary wear
and tear, and all alterations, improvements, and additions permitted under Section 3.4, excepted, at the expiration of the
Group I Easement Term, or at any earlier termination of this Lease, and (b) with
respect to a Group II Easement and the Easement Assets located thereon and
related thereto, in as good condition as it received the same, ordinary wear and
tear, and all alterations, improvements, and additions permitted under Section 3.4, excepted, at the expiration of the
Group II Easement Term applicable to such Group II Easement, or at any earlier
termination of this Lease. Notwithstanding the foregoing, Lessee
shall, at its sole cost and expense, remove or cause to be removed all Hazardous
Materials (i) from the Group I Easements on or before the expiration of the
Group I Easement Term and (ii) from a Group II Easement on or before the
expiration of the Group II Easement Term applicable to such Group II
Easement.
ARTICLE
5
TAXES,
ASSESSMENTS
Section
5.1 Obligation
to Pay Taxes. Lessor shall pay or cause to be paid during the
Term, all federal, state and local ad valorem taxes, assessments, and other
charges assessed by any Governmental Body against or with respect to the
Premises or the use or operation thereof (such taxes and assessments being
hereinafter called "Taxes") prior to the
time the same become delinquent. Lessee shall reimburse Lessor (or
its designee) for all Taxes promptly after the same are paid by or on behalf of
Lessor.
Section
5.2 Manner of
Payment. All Taxes to be paid by Lessor or on behalf of Lessor
shall be paid directly to the applicable taxing authority prior to delinquency
and Lessor shall promptly thereafter provide Lessee with evidence of such
payment. The certificate issued or given by the appropriate officials
authorized or designated by Law to issue or give the same or to receive payment
of such Taxes shall be prima facie evidence of the existence, payment,
nonpayment and amount of such Taxes.
Section
5.3 Taxes on
Lessee's Property. Lessee at all times shall be responsible
for and shall pay or cause to be paid all taxes levied or assessed on any
leasehold interest, any right of occupancy, any investment of Lessee in the
Premises, or any personal property of any kind owned, installed or used by
Lessee in or about the Premises, including Lessee's leasehold improvements,
equipment, and trade fixtures.
ARTICLE
6
INSURANCE
Section
6.1 Insurance
Requirements. Lessee shall obtain and maintain insurance
relating to the Premises and the activities thereon or associated therewith
containing coverage in such amounts and on such terms as are reasonably
acceptable to Lessor from a third party insurance provider who is reasonably
acceptable to Lessor. Upon request by Lessor from time to time,
Lessee shall provide to Lessor certificates of insurance or original copies of
insurance policies (as requested by Lessor) evidencing that insurance satisfying
the requirements of this Lease is in effect at all times.
Section
6.2 Waiver of
Subrogation. Anything in this Lease to the contrary
notwithstanding, to the extent permitted by Law Lessee waives any and all rights
of recovery, claim, action or cause of action against Lessor and its agents,
officers and employees for any loss or damage that may occur to the Premises by
reason of fire, the elements or any other cause which could be insured against
under the terms of standard fire and extended coverage insurance policies,
regardless of cause of origin, including negligence (sole or otherwise) of
Lessor or its agents, officers and employees.
ARTICLE
7
DAMAGE OR
DESTRUCTION
Lessee
shall promptly notify Lessor in writing of any damage to or destruction of the
Premises caused by fire or other casualty. If the Premises are wholly
or partially damaged or destroyed by fire or other casualty, then this Lease
shall continue in full force and effect, and Lessee shall (a) bear all costs and
expenses associated with such damage or destruction and (b) to the extent
applicable, promptly and diligently rebuild or replace at Lessee's sole cost and
expense the portion of the Easement Assets affected by such damage or
destruction to substantially the same condition existing prior to such damage or
destruction. All such replacement or rebuilding shall be performed in
a good and workmanlike manner and in accordance with all applicable permits and
authorizations, building and zoning Laws, and with all requirements of all
applicable Governmental Bodies, any applicable national or local board of fire
underwriters, or any other body exercising such functions and with the terms of
the applicable Group I Easement or Group II Easement.
ARTICLE
8
EMINENT
DOMAIN
Section
8.1 Total
Condemnation of Premises. If the whole of the Premises are
acquired or condemned by eminent domain for any public or quasi-public use or
purpose, then this Lease shall terminate as of the date title vests in any
public agency. All rentals and other charges owing hereunder shall be
prorated as of such date.
Section
8.2 Partial
Condemnation. If any part of the Premises is acquired or
condemned as set forth in Section 8.1,
then this Lease shall terminate as to the portion of the Premises so acquired or
condemned as of the date title vests in such Premises in any public
agency. In the event of such termination, Lessee's obligations
hereunder to the extent relating to such portion of the Premises shall cease as
of the effective date of such termination and, to the extent such termination
affects a Group I Easement, the Rent shall be proportionately reduced by an
amount equal to the reduction that would have occurred pursuant to Section 1.2 as of the effective date of such
termination.
Section
8.3 Damages. Lessor
shall be entitled to any award and all damages payable as a result of any
condemnation or taking of any of the Group I Easements or the Group I Easement
Assets, whether such award or damages are awarded as compensation for diminution
in value of the leasehold of such Premises. Lessee shall be entitled
to any award and all damages payable as a result of any condemnation or taking
of any of the Group II Easements or the Easement Assets located thereon and
related thereto, whether such award or damages are awarded as compensation for
diminution in value of the leasehold of such Premises. Lessee shall
have the right to claim and recover from the condemning authority, but not from
Lessor, such compensation as may be separately awarded or recoverable by Lessee
in Lessee's own right on account of any and all damage to Lessee's business by
reason of the condemnation, including loss of value of any unexpired portion of
the Term, and for or on account of any cost or loss to which Lessee might be put
in removing Lessee's merchandise, fixtures, leasehold improvements and equipment
from the Premises.
ARTICLE
9
ASSIGNMENT AND
SUBLETTING
Section
9.1 Assignment
by Lessor. Lessor shall have the right to assign or transfer
all or any part of Lessor's right and obligation hereunder and in the
Premises. Such assignments or transfers may be made to any Person and
the transferor shall automatically be released from all obligations of Lessor
under this Lease arising from and after the date of such assignment or
transfer.
Section
9.2 Assignment
and Sublease by Lessee. Lessee shall not assign or in any
manner transfer this Lease or Lessee's estate or interest herein or sublet the
Premises or any part or parts thereof without the prior written consent of
Lessor, and any attempt to do any of the foregoing without the prior written
consent of Lessor shall be void and of no effect.
ARTICLE
10
INDEMNITY
Section
10.1 Indemnity. Lessee
agrees to be responsible for and indemnify, defend, release and hold harmless
the Seller Indemnitees from and against all Claims arising out of, incident to
or in connection with (a) Lessee's failure to comply with the terms and
conditions set forth in this Lease or (b) any and all activities performed by or
on behalf of Lessee from and after the date of this Lease which relate to the
possession, use or operation of the Premises or the laying, use and operation of
the Replacement Line WITHOUT
REGARD TO THE CAUSE OR CAUSES OF ANY CLAIM, INCLUDING, WITHOUT LIMITATION, ANY
CLAIM CAUSED IN WHOLE OR IN PART BY (i) THE NEGLIGENCE (WHETHER SOLE, JOINT,
CONCURRENT, COMPARATIVE, CONTRIBUTORY, ACTIVE OR PASSIVE), STRICT LIABILITY OR
OTHER FAULT (BUT EXCLUDING GROSS NEGLIGENCE AND WILLFUL MISCONDUCT) OF THE
SELLER INDEMNITEES, INVITEES AND/OR THIRD PARTIES AND/OR (ii) A PRE-EXISTING
DEFECT, WHETHER PATENT OR LATENT, OF THE PREMISES.
Section
10.2 Survival. Notwithstanding
anything contained in this Lease to the contrary, the provisions of this Article 10 shall survive
the expiration or earlier termination of this Lease.
ARTICLE
11
GENERAL
PROVISIONS
Section
11.1 Severability. The
invalidity or unenforceability of any provision of this Lease, as determined by
a court of competent jurisdiction, shall in no way affect the validity or
enforceability of any other provision hereof.
Section 11.2 Time of
Essence. Time is of the essence in this Lease. If
the date specified in this Lease for giving any notice or taking any action is
not a Business Day (or if the period during which any notice is required to be
given or any action taken expires on a date which is not a Business Day), then
the date for giving such notice or taking such action (and the expiration date
of such period during which notice is required to be given or action taken)
shall be the next day which is a Business Day.
Section
11.3 Captions. The
headings to Articles, Sections and other subdivisions of this Lease are inserted
for convenience of reference only and will not affect the meaning or
interpretation of this Lease.
Section
11.4 Entire
Agreement; Amendment. This Lease, including the Exhibits
attached hereto, constitutes the entire agreement and understanding between the
parties hereto with respect to the lease of the Premises, and supersedes all
prior and contemporaneous agreements and undertakings of the parties
hereto. This Lease may be modified in writing only, signed by the
parties in interest at the time of modification.
Section
11.5 Notices. All
notices that are required or may be given pursuant to this Lease shall be
sufficient in all respects if given in writing and delivered personally, by
telecopy or by registered or certified mail, postage prepaid, as
follows:
If
to Lessor:
|
Cowtown
Pipeline L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: Stan
Page
Telephone:
(817) 665-5480
Telecopy:
(817) 665-5013
|
With
a copy to
(which
shall not
itself
constitute
notice):
|
Cowtown
Pipeline L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: John
C. Cirone
Telephone: (817)
665-4939
Telecopy: (817)
665-5021
|
If
to Lessee:
|
Cowtown
Pipeline Partners L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: Cliff
Rupnow
Telephone: (817)
665-4970
Telecopy: (817)
665-5008
|
With
a copy to
(which
shall not
itself
constitute
notice):
|
Cowtown
Pipeline Partners L.P.
777
West Rosedale Street
Fort
Worth, Texas 76104
Attention: Regina
Himelfarb
Telephone: (817)
665-5425
Telecopy: (817)
665-5021
|
Either
party hereto may change its address for notice by notice to the other in the
manner set forth above. All notices shall be deemed to have been duly
given at the time of receipt by the party to which such notice is
addressed.
Section
11.6 Waivers. No
waiver or waivers of any breach or default or any breaches or defaults by either
party of any term, condition or liability of or performance by the other party
of any duty or obligation hereunder shall be deemed or construed to be a waiver
or waivers of subsequent breaches or defaults of any kind, character or
description under any circumstance. The acceptance of Rent hereunder
by Lessor shall not be a waiver of any preceding breach by Lessee of any
provision hereof, other than the failure of Lessee to pay the particular rent so
accepted, regardless of Lessor's knowledge of such preceding breach at the time
of acceptance of such rent.
Section
11.7 No
Partnership. The relationship between Lessor and Lessee at all
times shall remain solely that of landlord and tenant and shall not be deemed a
partnership or joint venture.
Section
11.8 No Third
Party Beneficiaries. This Lease inures to the sole and
exclusive benefit of Lessor and Lessee, their respective successors, legal
representatives and permitted assigns, and confers no benefit on any third
party.
Section
11.9 Mutual
Cooperation; Further Assurances. Upon request by either party
hereto from time to time during the Term, the other party hereto agrees to
execute and deliver all such other and additional instruments, notices and other
documents and do all such other acts and things as may be necessary to carry out
the purposes of this Lease and to more fully assure the parties' rights and
interests provided for hereunder.
Section
11.10 Binding
Effect. Except as herein otherwise expressly provided, this
Lease shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. Nothing in
this Section 11.10 shall be
construed to waive the conditions elsewhere contained in this Lease applicable
to assignment or subletting of the Premises by Lessee.
Section
11.11 Remedies. If,
by the terms of this Lease, Lessee is required to do or perform any act or to
pay any sum to a third party, and fails or refuses to do so, Lessor, after ten
(10) days written notice to Lessee, without waiving any other right or remedy
available at Law or in equity for such default, may do or perform such act, at
Lessee's expense, or pay such sum for and in behalf of Lessee, and the amounts
so expended by Lessor shall be repayable on demand, and bear interest from the
date expended by Lessor until paid at a rate equal to the lesser of
(a) [____ percent
(__%)] or (b) the
maximum non-usurious rate of interest permitted to be charged Lessee under
applicable law. Past due Rent and any other past due payments
required hereunder shall bear interest from maturity until paid at the interest
rate set forth in this Section
11.11.
Section
11.12 Choice of
Law; Venue. THIS LEASE AND THE LEGAL RELATIONS BETWEEN THE
PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF TEXAS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS OTHERWISE
APPLICABLE TO SUCH DETERMINATIONS. JURISDICTION AND VENUE WITH
RESPECT TO ANY DISPUTES ARISING HEREUNDER SHALL BE PROPER ONLY IN TARRANT
COUNTY, TEXAS.
Section
11.13 No
Warranty. Notwithstanding anything herein contained to the
contrary, Lessor makes no representation or warranty, express, implied,
statutory or otherwise, with respect to Lessor's title to any of the
Premises.
Section
11.14 Construction. Any
capitalized term used but not otherwise defined in this Lease shall have the
meaning given to such term in the Purchase Agreement. All references
in this Lease to an "Article," "Section," or "subsection" shall be to an
Article, Section, or subsection of this Lease, unless the context requires
otherwise. Unless the context otherwise requires, the words "this
Lease," "hereof," "hereunder," "herein," "hereby," or words of similar import
shall refer to this Lease as a whole and not to a particular Article, section,
subsection, clause or other subdivision hereof. Any references in
this Lease to (a) any gender include a reference to all other genders and (b)
the singular include the plural, and vice versa.
Section
11.15 Exhibits. Unless
expressly provided to the contrary, reference to any Exhibit means an Exhibit to
this Lease, all of which are incorporated into and made a part of this
Lease.
Section
11.16 Survival. Notwithstanding
anything herein contained to the contrary, all obligations of Lessor and Lessee
that shall have accrued under this Lease prior to the expiration or earlier
termination hereof shall survive such expiration or termination to the extent
the same remain unsatisfied as of the expiration or earlier termination of this
Lease. Lessor and Lessee further expressly agree that all provisions
of this Lease which contemplate performance after the expiration or earlier
termination hereof shall survive such expiration or earlier termination of this
Lease.
[SIGNATURE
PAGE FOLLOWS]
The
parties hereto have executed this Lease to be effective as of the day first
hereinabove written.
LESSOR:
|
||||
COWTOWN
PIPELINE L.P.
|
||||
By:
|
Cowtown
Pipeline Management, Inc.,
|
|||
Its
General Partner
|
||||
By: | ||||
Name: | ||||
Title: |
LESSEE:
|
||||
COWTOWN
PIPELINE PARTNERS L.P.
|
||||
By:
|
Quicksilver
Gas Services Operating GP LLC,
|
|||
Its
General Partner
|
||||
By: | ||||
Name: | ||||
Title: |
EXHIBIT
D
Attached
to and made part of that certain
Purchase
and Sale Agreement executed on December 10, 2009,
by and
among Cowtown Pipeline L.P., as "Seller", and
Quicksilver
Gas Services LP and Cowtown Pipeline Partners L.P., as "Purchasers"
GUARANTY
AGREEMENT
This GUARANTY AGREEMENT (this
“Guaranty”) dated as of
December 10, 2009, by Quicksilver
Resources Inc., a Delaware corporation (“Guarantor”), to and
in favor of Quicksilver
Gas Services LP,
a Delaware limited partnership, and Cowtown
Pipeline Partners L.P., a Texas limited partnership (collectively, the
“Beneficiaries”).
RECITALS
A. Cowtown
Pipeline L.P., a Texas limited partnership (“Seller”), entered
into that certain Purchase and Sale Agreement with the Beneficiaries on even
date herewith (the “Purchase
Agreement”).
B. Guarantor
indirectly owns equity interests in Seller.
C. To
induce the Beneficiaries to enter into the transactions evidenced by the
Purchase Agreement, Seller is required to deliver this Guaranty, duly executed
by Guarantor, to the Beneficiaries contemporaneously with the execution of the
Purchase Agreement by Seller and the Beneficiaries.
D. The
guarantees provided in this Guaranty are reasonably expected to benefit,
directly or indirectly, Guarantor, and entering into and executing this Guaranty
is in the best interest of Guarantor.
E. Capitalized
terms used but not otherwise defined herein shall have the meaning given to such
terms in the Purchase Agreement.
AGREEMENTS
IN CONSIDERATION of the
foregoing, Guarantor agrees as follows:
1. Obligations
Subject
to Section 8 of this
Guaranty, Guarantor irrevocably and unconditionally guarantees to the
Beneficiaries the due and punctual payment and performance of all present and
future payments, indemnifications or other obligations required to be performed
by Seller to the Beneficiaries which now exist or hereafter arise under the
Purchase Agreement (the “Obligations”).
2. Nature
of Guaranty
(a) This
Guaranty is a guarantee of payment and performance and not of collection and may
be enforced by the Beneficiaries directly against Guarantor without any
requirement that the Beneficiaries must first exercise their rights against
Seller. There are no conditions precedent to the enforcement of this
Guaranty. The obligations of Guarantor hereunder shall be continuing,
absolute and unconditional and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected
by:
(i) any
change in the name, the capital, or the partnership documents of
Seller;
(ii) any
amalgamation, merger or re-organization of Seller (in which case this Guaranty
shall apply to the corporation, limited liability company, partnership or other
entity, as the case may be, resulting or continuing therefrom);
(iii) at
any time or from time to time, without notice to Guarantor, the time for any
performance of or compliance with any of the Obligations shall be extended, or
such performance or compliance shall be waived;
(iv) the
Obligations shall be modified, supplemented, increased or amended in any respect
or any right under the Purchase Agreement or any other agreement or instrument
relating thereto (other than this Guaranty) shall be waived or any other
guarantee of the Obligations or any other letter of credit, guaranty or security
therefor shall be released or exchanged in whole or in part or otherwise dealt
with;
(v) at
any time, the Obligations, the Purchase Agreement or any other agreement or
instrument relating thereto shall cease to be valid or enforceable, other than
the termination of the Purchase Agreement in accordance with its terms;
or
(vi) one
of the following events shall occur with respect to Guarantor:
(a) Guarantor institutes a voluntary case seeking liquidation or
reorganization under applicable bankruptcy law or shall consent to the
institution of an involuntary case thereunder against it; (b) Guarantor
files a petition, answer or consent or shall otherwise institute any similar
proceeding under any other applicable Law, or shall consent thereto; (c)
Guarantor applies for, or by consent there shall be an appointment of, a
receiver, liquidator, sequestrator, trustee or other officer with similar powers
for itself or any substantial part of its assets; (d) Guarantor makes an
assignment for the benefit of creditors; (e) Guarantor admits in writing its
inability to pay its debts generally as they become due; (f) if an involuntary
case shall be commenced seeking the liquidation or reorganization of Guarantor
under applicable bankruptcy law or any similar proceeding shall be commenced
against Guarantor under any other applicable Law and (i) the petition
commencing the involuntary case is not timely controverted; (ii) the petition
commencing the involuntary case is not dismissed within sixty (60) days of its
filing; (iii) an interim trustee is appointed to take possession of all or a
portion of the property, and/or to operate all or any part of the business of
Guarantor and such appointment is not vacated within sixty (60) days; or (iv) an
order for relief shall have been issued or entered therein; or a decree or order
of a court having jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee or other officer having similar
powers of Guarantor or of all or a part of its property, shall have been
entered; or (g) any other similar relief shall be granted against Guarantor
under any applicable Law.
(b) This
Guaranty constitutes a guarantee of payment and performance and not of
collection, and the obligations of Guarantor under this Guaranty are primary
obligations of Guarantor, and a separate action or actions may be brought and
prosecuted against Guarantor to enforce this Guaranty, irrespective of whether
any action is brought against Seller or any other Person or whether Seller or
any other Person is joined in such action or actions.
(c) Guarantor
warrants and agrees that each of the waivers and consents set forth in this
Guaranty are made voluntarily and unconditionally after consultation with legal
counsel and with full knowledge of their significance and consequences, with the
understanding that events giving rise to any defense or right waived may
diminish, destroy or otherwise adversely affect rights which Guarantor otherwise
may have against Seller or any other Person. If, notwithstanding the
intent of the parties that the terms of this Guaranty shall control in any and
all circumstances, any such waivers or consents are determined to be
unenforceable under applicable Law, such waivers and consents shall be effective
to the maximum extent permitted by Law.
3. Liability
as Primary Debtor
All
debts, liabilities and obligations incurred by Seller to the Beneficiaries under
or pursuant to the Purchase Agreement shall form part of the
Obligations despite (a) any incapacity, disability, or lack or limitation
of status, authorization or power of Seller or any of its directors, officers or
agents (other than incapacity, disability or lack or limitation of status,
authorization or power of which the Beneficiaries have been given actual notice
by Seller or Guarantor); (b) Seller not being a legal entity; (c) the
bankruptcy, insolvency, dissolution or liquidation of Seller; and (d) any lack
of a written contract or of execution of documents by Seller if Seller has
agreed in writing with the Beneficiaries to be bound by transactions without
such writing or execution. Any such debts, liabilities and
obligations which may not be recoverable from Guarantor as guarantor shall be
recoverable from Guarantor as principal debtor upon demand and with interest,
calculated and payable as provided in this Guaranty.
4. Continuing
Guaranty
This is a
continuing guarantee and shall apply to and secure the payment and performance
of all Obligations. This Guaranty shall be reinstated if at any time
any payment of any Obligation is rescinded or must otherwise be restored or
returned by the Beneficiaries upon the insolvency, bankruptcy or reorganization
of Seller or for any other reason whatsoever, all as though such payment had not
been made.
5. Term
This
Guaranty will remain in full force and effect (a) with respect to the
Obligations arising under Section 7.10 of the Purchase Agreement, until March
31, 2019, and (b) with respect to all other Obligations arising under the
Purchase Agreement, until thirty (30) months from the Closing
Date. Any such termination shall not affect Guarantor’s liability for
amounts due pursuant to Obligations with respect to any written notice of claim
or demand given to Guarantor by the Beneficiaries prior to (i) March 31, 2019,
with respect to the Obligations arising under Section 7.10 of the Purchase
Agreement, or (ii) the expiration of such thirty (30) month period, with respect
to all other Obligations arising under the Purchase Agreement.
6. Right
to Payment
Guarantor’s
liability under this Guaranty will not be affected by the existence, validity,
enforceability, perfection or extent of any collateral or security for the
Obligations. The Beneficiaries shall not be obligated to file any
claim relating to the Obligations if Seller becomes subject to a bankruptcy,
reorganization or similar proceeding and the failure of the Beneficiaries to do
so shall not affect Guarantor’s obligations under this
Guaranty. Except as provided in Section 8 of this
Guaranty, the Beneficiaries shall not be bound to seek or exhaust their recourse
against Seller or any other Person or to realize on any security it may hold in
respect of the Obligations before being entitled to payment under this
Guaranty.
7. Dealings
by Beneficiaries
The
Beneficiaries may, without giving notice to or obtaining the consent of
Guarantor, enter into agreements and transactions with Seller, amend or modify
agreements with Seller, settle or compromise any of the Obligations, grant
extensions of time and other indulgences, take and give up securities, accept
compositions, grant releases and discharges, whether full, partial, conditional
or otherwise, perfect or fail to perfect any securities, release any
undertaking, property or assets charged by any securities to third parties and
otherwise deal or fail to deal with Seller and others (including, without
limitation, any other guarantors), all as the Beneficiaries may see fit, without
prejudice to or in any way discharging or diminishing the liability of Guarantor
and no loss of or in respect of any securities received by the Beneficiaries
from Seller or any other Persons, whether occasioned through the fault of the
Beneficiaries or otherwise, shall in any way discharge or diminish the liability
of Guarantor.
8. Payment
If Seller
fails to pay or perform any Obligation when due, Guarantor’s obligation to pay
or perform that Obligation shall arise only upon the Beneficiaries' demand
(“Demand”) in
accordance with this Guaranty. Subject to the limitations set forth
herein, Guarantor shall pay or commence to perform the Obligations set forth in
such Demand within five (5) Business Days of its receipt of such Demand. A
Demand shall be in writing and shall reasonably specify in what manner and what
amount Seller has failed to pay or perform an Obligation and provide an
explanation of why such payment or performance of such Obligation is due, with a
specific statement that Beneficiaries are calling upon Guarantor to pay or
perform such Obligations under this Guaranty. A single written Demand shall be
effective as to any specific default during the continuance of such default,
until such default has been cured, and additional written demands concerning
such default shall not be required until such default is cured. Each
Demand shall be delivered to Guarantor’s address set forth in this Guaranty or
at such other address as Guarantor may from time to time designate to the
Beneficiaries in writing.
9. Waivers
Guarantor
waives notice of acceptance of this Guaranty and waives diligence, presentment,
protest, notice of protest, acceleration or dishonor and all demands whatsoever
other than the Demand described in Section 8 of this
Guaranty. Any failure of the Beneficiaries to exercise, any course of
dealing with respect to, and any delay by the Beneficiaries (other than a delay
that gives rise to a defense under an applicable statute of limitation) in
exercising, any right, remedy or power under this Guaranty shall not operate as
a waiver of such right, remedy or power. Any single or partial
exercise by either of the Beneficiaries of any right, remedy or power under this
Guaranty shall not preclude any other or future exercise of any right, remedy or
power.
10. Limitations
Except
to the extent that the Purchase Agreement expressly provides that Seller shall
have liability for damages other than direct, actual damages, THE LIABILITY OF
GUARANTOR SHALL BE LIMITED TO DIRECT, ACTUAL DAMAGES AND GUARANTOR SHALL NOT BE
LIABLE FOR ANY SPECIAL, PUNITIVE, EXEMPLARY, INCIDENTAL, CONSEQUENTIAL OR
INDIRECT DAMAGES OR ANY LOST PROFITS, LOST BENEFITS, LOSS OF ENTERPRISE VALUE,
DIMINUTION IN VALUE OF ANY BUSINESS, DAMAGE TO REPUTATION OR LOSS TO
GOODWILL.
11. Subrogation
Rights
Until an
Obligation has been paid in full, Guarantor shall not have any right to be
subrogated to any rights of the Beneficiaries with respect to that
Obligation. Upon payment or performance of any of the Obligations,
Guarantor shall be subrogated to the rights of the Beneficiaries against Seller
with respect to that Obligation, and the Beneficiaries agree to take, at
Guarantor’s expense, such steps as Guarantor may reasonably request to implement
such subrogation. If any amount is paid to Guarantor on account of
subrogation rights under this Guaranty in violation of this Section 11, such amount shall
be held in trust by Guarantor for the benefit of the Beneficiaries and shall be
promptly paid to the Beneficiaries to be credited and applied to the
Obligations, whether matured or unmatured or absolute or contingent, in
accordance with the terms of the Purchase Agreement.
12. Set-off
Guarantor
reserves the right to set off any amounts or obligations due by the
Beneficiaries to Seller under the Purchase Agreement against any payments or
performance of the Obligations due under this Guaranty; provided, the foregoing
right of set off shall not apply with respect to any amounts or obligations
which are being contested in good faith by the Beneficiaries. In the
event Guarantor sets off amounts owed by it to the Beneficiaries against amounts
or obligations owed by the Beneficiaries to Seller, Guarantor shall indemnify
and hold the Beneficiaries harmless against any claims by Seller for payment of
the set off amounts.
13. Representations
and Warranties
Guarantor
represents and warrants to the Beneficiaries that (a) it is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, (b) the execution, delivery and performance of this Guaranty are
within Guarantor’s powers, have been duly authorized by any necessary action and
do not violate Guarantor's by-laws, articles of incorporation or any Law, or
contractual restriction binding on Guarantor, (c) any governmental and other
consents required with respect to the execution, delivery and performance of
this Guaranty by Guarantor have been obtained and are in full force and effect
and all conditions of any such consents have been complied with, and (d) this
Guaranty constitutes the legal, valid and binding obligation of Guarantor,
enforceable against it in accordance with its terms (except as enforceability
may be limited by bankruptcy, insolvency, moratorium and other Laws affecting
enforcement of creditors rights in general and general principles of
equity).
14. Additional
Security
This
Guaranty is in addition and without prejudice to any security of any kind
(including, without limitation, any other guarantees, whether or not in the same
form) held by the Beneficiaries.
15. Notices
Notices
under this Guaranty shall be provided in writing and shall be deemed received if
sent to the address or fax number specified below: (i) on the day
received if sent by courier delivery, (ii) on the next Business Day if sent by
facsimile transmission when sender has machine confirmation that the notice was
transmitted, or (iii) three (3) Business Days after mailing if sent by certified
or registered mail.
To
Guarantor:
Quicksilver Resources Inc.
777 West Rosedale Street
Fort Worth,
Texas 76104
Attn: Philip
Cook
Facsimile: (817)
665-5004
To the
Beneficiaries:
Quicksilver
Gas Services LP
Cowtown
Pipeline Partners L.P.
777 West
Rosedale Street
Fort
Worth, Texas 76104
Attn: Cliff
Rupnow
Facsimile: (817)
665-5008
With a
copy to (which shall not itself constitute notice):
Quicksilver
Gas Services LP
Cowtown
Pipeline Partners L.P.
777 West
Rosedale Street
Fort
Worth, Texas 76104
Attn: Regina
Himelfarb
Facsimile: (817)
665-5021
Guarantor
and the Beneficiaries may change their respective address for notices by
providing notice to the other party or parties, as applicable, in accordance
with this Section
15.
16. Entire
Agreement
There are
no representations, conditions, agreements or understandings with respect to
this Guaranty or affecting the liability of Guarantor or the Beneficiaries other
than as set forth or referred to in this Guaranty. No provision of
this Guaranty may be amended or waived except by a written instrument executed
by Guarantor and the Beneficiaries. Notwithstanding anything else
herein set forth, this Guaranty constitutes the entire agreement between the
Beneficiaries and Guarantor with respect to the subject matter hereof and
cancels and supersedes any prior guarantees, agreements and understandings
between such parties with respect thereto.
17. Successors
and Assigns
This
Guaranty shall inure to the benefit of and be binding upon the respective
successors and permitted assigns of Guarantor and the
Beneficiaries. This Guaranty shall not be assigned or otherwise
transferred, in whole or in part, without the prior written consent of
Guarantor, with respect to an assignment or transfer by either of the
Beneficiaries, or the Beneficiaries, with respect to an assignment or transfer
by Guarantor.
18. Governing
Law and Attornment
This
Guaranty shall be governed by and construed in accordance with the Laws of Texas
without regard to principles of conflicts of laws otherwise applicable to such
determinations. Jurisdiction and venue with respect to any action or
proceeding arising out of or relating to this Guaranty shall be proper only in
Tarrant County, Texas.
19. No
Other Claims Against Guarantor
The
Beneficiaries, on behalf of itself and its Affiliates, shall not institute or
cause to be instituted any proceeding or bring any other claim arising under, or
in connection with, the Purchase Agreement or the transactions contemplated
thereby, against Guarantor or their respective Affiliates except for claims
against Guarantor (and not against Guarantor’s Affiliates) under this
Guaranty.
EXECUTED as of the date first
above written.
QUICKSILVER
RESOURCES INC.
|
||||
By: | ||||
Name: | ||||
Title: |
Schedule
1.2(b)
Contracts
In
addition to the items described on Schedule 5.13 Outstanding
Capital Commitments:
Item #
|
Date
|
Parties
|
Counterparties
|
Subject Matter
|
1.
|
08-21-2009
|
Cowtown
Pipeline L.P.
|
Denton
County Electric Cooperative
|
Agreement
for Provision of Electric Service
|
2.
|
08-21-2009
|
Cowtown
Pipeline L.P.
|
Denton
County Electric Cooperative
|
Transmission
Interconnection Requirements Agreement
|
3.
|
05-13-2009
|
Quicksilver
Resources Inc.
|
Williams
Scotsman, Inc.
|
Lease
Agreement (modular office building)
|
4.
|
05-13-2009
|
Cowtown
Pipeline L.P.
|
Crosstex
North Texas Gathering, L.P.
|
Facilities
Construction Agreement
(pipeline
interconnection)
|
5.
|
05-13-2009
|
Quicksilver
Resources Inc.
Cowtown
Pipeline L.P.
|
Crosstex
Energy Services, L.P.
Crosstex
North Texas Gathering, L.P.
Crosstex
North Texas Pipeline, L.P.
Crosstex
Gulf Coast Marketing Ltd.
|
Settlement
Agreement
|
6.
|
06-16-2009
|
Cowtown
Pipeline L.P.
|
Energy
Transfer Fuel, LP
|
Facilities
Construction Agreement
(pipeline
interconnection)
|
7.
|
01-01-2006
|
Quicksilver
Resources Inc.
|
Universal
Compression, Inc.
|
Master
Compression Services Agreement
|
8.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #3)
|
9.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #2)
|
10.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #4)
|
11.
|
06-30-2009
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Pad Unit #5)
|
12.
|
06-30-2009
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Pad Unit #6)
|
13.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #1)
|
14.
|
10-01-2009
|
Cowtown
Pipeline L.P.
|
Devon
Energy Production Company
|
Gas
Gathering Agreement
|
15.
|
___*
|
Cowtown
Pipeline L.P.
|
Crosstex
|
Gas
Gathering Agreement
|
16.
|
12-01-2009
|
Cowtown
Pipeline L.P.
|
Quicksilver
Resources Inc.
|
Gas
Gathering Agreement
|
17.
|
4-01-2009
|
Cowtown
Pipeline L.P.
|
Eni
Petroleum US LLC
|
Gas
Gathering Agreement
|
* While
the parties to this agreement have agreed upon the terms of this agreement,
Crosstex has not yet executed this agreement.
Schedule
1.2(c)
Surface
Contracts
Item
#
|
Line
No.
|
Line
Name
|
County
|
File
No
|
Grantor
|
Original
Grantee
|
Agmt
Dated
|
File
Type
|
Recorded
- Book
|
Recorded
- Page
|
Document
#
|
Amended
Dated
|
Amendment
Recorded
|
A1.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TX1210022.99
|
M T
COLE TRUST NO 2
|
COWTOWN
PIPELINE LP
|
2/13/2009
|
DEED
|
200917582
|
||||
A2.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TX1210032.55
|
ENTERPRISE
TEXAS PIPELINE
|
COWTOWN
PIPELINE LP
|
9/24/2009
|
SURF
|
2009-138526
|
||||
A3.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TX4390902.55
|
FORT
WORTH RAILROAD SALVAG
|
COWTOWN
PIPELINE LP
|
3/30/2009
|
SURF
|
D209243916
|
||||
A4.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TX4390906.55
|
FW
FORT WORTH 109 LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/4/2005
|
SURF
|
D205055739
|
||||
A5.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01347.55
|
BNSF
RAILWAY CO #04-26236
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
A6.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01348.55
|
BNSF
RAILWAY CO #04-26238
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
A7. *
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01349.55
|
BNSF
RAILWAY CO #04-26240
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
A8.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01361.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215288
|
||||
A9.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01362.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215308
|
||||
A10.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01370.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215319
|
||||
A11.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01371.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215320
|
||||
A12. *
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01373.55
|
AIL
INVESTMENT LP ET AL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/1/2005
|
PLROW
|
D205357288
|
Effective
7/1/2005
|
D208215295
|
||
A13.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01393.55
|
SONE
K SANGCHAN ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
3/30/2005
|
PLROW
|
D206161681
|
||||
A14.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01433.55
|
METROPORT
CITIES FELLOWSHI
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/12/2006
|
PLROW
|
D206061771
|
||||
A15.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01437.55
|
KATY
ROAD 29 AC LTD
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
4/29/2005
|
PLROW
|
D206119319
|
||||
A16.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01453.55
|
TXDOT 220-HPG-10-05
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/7/2005
|
PERMIT
|
N/A
|
||||
A17.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01471.55
|
FW
FORT WORTH 109 LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/4/2005
|
PLROW
|
D205055740
|
||||
A18.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01472.55
|
FW
FORT WORTH 109 LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/4/2005
|
PLROW
|
D205055741
|
||||
A19.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01571.55
|
DC
METZGER PROPERTIES LTD
|
COWTOWN
PIPELINE LP
|
10/23/2009
|
PLROW
|
2009-138522
|
||||
A20.
|
AL100
|
ALLIANCE
20" NORTH PIPELINE A
|
DENTON
|
TXPL01491.55
|
BNSF
RAILWAY CO #09-37662
|
COWTOWN
PIPELINE LP
|
3/26/2009
|
PERMIT
|
N/A
|
||||
A21.
|
AL100A1
|
ALLIANCE
DELIVERY POINT
|
TARRANT
|
TX4390887.55
|
TRIPLE
T FARMS LTD
|
COWTOWN
PIPELINE LP
|
2/13/2009
|
SURF
|
D209188718
|
||||
A22. **
|
AL102
|
ALLIANCE
20" NORTH PIPELINE C
|
DENTON
|
TXPL01404.55
|
MT
COLE TRUST NO 2 & 3
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
3/26/2008
|
PLROW
|
2008-36679
|
2/9/2009
|
2009-14364
|
||
A23. **
|
AL102
|
ALLIANCE
20" NORTH PIPELINE C
|
DENTON
|
TXPL01404.55
|
MT
COLE TRUST NO 2 & 3
|
Effective
2/9/09
|
2009-117217
|
||||||
A24.
|
AL102
|
ALLIANCE
20" NORTH PIPELINE C
|
DENTON
|
TXPL01492.55
|
BNSF
RAILWAY CO #09-37663
|
COWTOWN
PIPELINE LP
|
3/26/2009
|
PERMIT
|
N/A
|
||||
A25. **
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01419.55
|
M T
COLE TRUST NO 2 & 3
|
COWTOWN
PIPELINE LP
|
2/9/2009
|
PLROW
|
2009-14365
|
Effective
2/9/09
|
2009-117218
|
||
A26.
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01429.55
|
CALVIN
B PETERSON ET AL
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
10/31/2007
|
PLROW
|
2007135653
|
2009-109627
|
|||
A27.
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01464.55
|
DC
METZGER PROPERTIES LTD
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
12/7/2007
|
PLROW
|
2008-55274
|
||||
A28.
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01493.55
|
BNSF
RAILWAY CO #09-37759
|
COWTOWN
PIPELINE LP
|
3/25/2009
|
PERMIT
|
N/A
|
||||
A29.
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01509.55
|
TXDOT
FM 156 20090325057
|
COWTOWN
PIPELINE LP
|
3/17/2009
|
PERMIT
|
N/A
|
||||
A30.
|
AL105D
|
ALLIANCE
12" GOLDEN ARBROOK
|
TARRANT
|
TXPL01396.55
|
CITY
OF FORT WORTH
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
3/20/2006
|
PLROW
|
33346
|
||||
A31.
|
AL105D
|
ALLIANCE
12" GOLDEN ARBROOK
|
TARRANT
|
TXPL01430.55
|
SYNERGY
INDUSTRIAL PARK LT
|
CHIEF
OIL & GAS LLC
|
10/20/2004
|
PLROW
|
D205055742
|
||||
A32.
|
AL105D
|
ALLIANCE
12" GOLDEN ARBROOK
|
TARRANT
|
TXPL01467.55
|
TRANSCONTINENTAL
REALTY IN
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/23/2006
|
PLROW
|
06-38728-3
|
||||
A33.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01432.55
|
METROPORT
CITIES FELLOWSHI
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/12/2006
|
PLROW
|
D206061770
|
||||
A34.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01459.55
|
TARRANT
COUNTY 06-26
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
3/6/2006
|
PERMIT
|
N/A
|
||||
A35.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01468.55
|
TRANSCONTINENTAL
REALTY IN
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/21/2006
|
PLROW
|
06-38718-2
|
||||
A36.
|
ALEL100A1
|
ALLIANCE
DELIVERY POINT ELECTRIC LINE
|
TARRANT
|
TX4390900.55
|
BNSF
RAILWAY CO #09-37863
|
COWTOWN
PIPELINE LP
|
4/14/2009
|
PERMIT
|
N/A
|
||||
A37. **
|
ALGL101
|
ALLIANCE
8" NORTH GAS LIFT B
|
DENTON
|
TXPL01508.55
|
TXDOT
FM 156 20090326061
|
COWTOWN
PIPELINE LP
|
3/27/2009
|
PERMIT
|
N/A
|
||||
A38.
|
ALGL101A
|
ALLIANCE
COMMERCE LOOP
|
DENTON
|
TXPL01403.55
|
JAY
C MCLENNAN
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
12/31/2007
|
PLROW
|
2008-8913
|
||||
A39.
|
ALGL101A
|
ALLIANCE
COMMERCE LOOP
|
DENTON
|
TXPL01405.55
|
JEANNE
SHELTON
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
12/18/2007
|
PLROW
|
2007-14660
|
||||
A40.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01603.55
|
COWTOWN
PIPELINE LP
|
COWTOWN
PIPELINE LP
|
9/2/2009
|
PLROW
|
2009-138521
|
*
Insofar as, and only insofar as, the item covers tracts depicted in green on
Schedule 1.2(e) Pipelines.
**
Insofar as, and only insofar as, the item covers a 20” natural gas
gathering pipeline located within boundaries of the easement or
permit.
Item #
|
Date
|
Parties
|
Counterparties
|
Subject Matter
|
B1.
|
07-31-2009
|
Cowtown
Pipeline L.P.
|
Texas
Commission on Environmental Quality
|
Form
PI-7-CERT
Certification
and Registration of Permits by Rule
|
B2.
|
02-09-2009
|
Quicksilver
Resources Inc.
|
Denton
County
|
Application
for Development Permit
(Denton
County Flood Prevention Ordinance)
|
B3.
|
Chief
Resources Alliance Pipeline LLC
|
City
of Haslet, Texas
|
Specific
Use Permit #P01270404
|
|
B4.
|
Chief
Resources Alliance Pipeline LLC
|
City
of Haslet, Texas
|
Specific
Use Permit #PO6140405
|
|
B5.
|
Cowtown
Pipeline L.P.
|
City
of Haslet, Texas
|
Specific
Use Permit #S0101-06
|
|
B6.
|
Cowtown
Pipeline L.P.
|
City
of Haslet, Texas
|
Specific
Use Permit #S0101-06
|
|
B7.
|
Cowtown
Pipeline L.P.
|
City
of Haslet, Texas
|
Specific
Use Permit #S1201-06-A1
|
|
B8.
|
08-04-2009
|
Cowtown
Pipeline L.P.
|
Railroad
Commission of Texas
|
Permit
to Operate Pipeline
|
Schedule
1.3(e)
Excluded
Items
None.
Schedule
1.3(j)
Excluded
Rights-of-Way
Item
#
|
Line
No.
|
Line
Name
|
County
|
File
No
|
Grantor
|
Original
Grantee
|
Agmt
Dated
|
File
Type
|
recorded_book
|
recorded_page
|
recorded_entry
|
Amended
Dated
|
Amendment
Recorded
|
1. *
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01349.55
|
BNSF
RAILWAY CO #04-26240
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
2.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01352.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/30/2008
|
PLROW
|
D208252656
|
||||
3.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01364.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D200861967
|
||||
4. *
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01373.55
|
AIL
INVESTMENT LP ET AL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/1/2005
|
PLROW
|
D205357288
|
Effective
7/1/2005
|
D208215295
|
||
5.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01353.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/30/2008
|
PLROW
|
D208252659
|
||||
6.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01354.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/30/2008
|
PLROW
|
D208252658
|
||||
7.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01355.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/30/2008
|
PLROW
|
D208252657
|
||||
8.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01356.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/30/2008
|
PLROW
|
D208252655
|
||||
9.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01357.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215305
|
||||
10.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01358.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215290
|
||||
11.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01359.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215291
|
||||
12.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01360.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215316
|
||||
13.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01363.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215307
|
||||
14.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01367.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215289
|
||||
15.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01368.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215309
|
||||
16.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01369.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215297
|
||||
17.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01372.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215311
|
||||
18.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01375.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215317
|
||||
19.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01377.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215296
|
||||
20.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01382.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215298
|
||||
21.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01383.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215314
|
||||
22.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01384.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215310
|
||||
23.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01385.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215315
|
||||
24.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01386.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215313
|
||||
25.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01388.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215300
|
||||
26.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01389.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215292
|
||||
27.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01390.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215301
|
||||
28.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01394.55
|
TXU
ELECTRIC DELIVERY CO
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
10/28/2005
|
PLROW
|
2006-52082
|
||||
29.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01395.55
|
TXU
ELECTRIC DELIVERY CO
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
10/28/2005
|
PLROW
|
2006-52083
|
||||
30.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01407.55
|
ALLIANCE
CENTER WEST ASSOC
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/1/2005
|
PLROW
|
D205357286
|
||||
31.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01420.55
|
EMAD
A ELGOHAIL
|
EAGLE
OIL & GAS CO
|
5/21/2003
|
PLROW
|
5343
|
2143
|
83570
|
||
32.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01421.55
|
CARL
BRASWELL ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
6/2/2005
|
PLROW
|
2006-47568
|
||||
33.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01422.55
|
CLYDE
E WALL ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
6/15/2005
|
PLROW
|
2006-47570
|
||||
34.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01424.55
|
DARIN
WINGER ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
6/15/2005
|
PLROW
|
2006-47572
|
||||
35.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01425.55
|
RUSSELL
E HALL ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/24/2006
|
PLROW
|
2006-9335
|
||||
36.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01426.55
|
RANDY
DAY ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/24/2006
|
PLROW
|
2006-27642
|
||||
37.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01427.55
|
GRANT
T DOSTERT ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/31/2006
|
PLROW
|
2006-13446
|
||||
38.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01431.55
|
KELLY
DACRE ET AL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
8/27/2005
|
PLROW
|
2008-50467
|
||||
39.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01434.55
|
FREDERIK
FLOREN TRUSTEE
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
4/1/2005
|
PLROW
|
D206161683
|
||||
40.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01435.55
|
MARK
J DAVIS ET UX
|
CHIEF
OIL & GAS LLC
|
12/14/2004
|
PLROW
|
D205055743
|
||||
41.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01444.55
|
INTEL
CORPORATION
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
12/6/2007
|
PLROW
|
2008-8914
|
||||
42.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01447.55
|
AIL
INVESTMENT LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/1/2006
|
PLROW
|
2006-56358
|
||||
43.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01449.55
|
TXDOT
220-HPG-8-05
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/7/2005
|
PERMIT
|
N/A
|
||||
44.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01450.55
|
TXDOT
220-HPG-244-05
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
4/27/2005
|
PERMIT
|
N/A
|
||||
45.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01451.55
|
TXDOT 220-G-279-04
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
9/23/2004
|
PERMIT
|
N/A
|
||||
46.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01452.55
|
TXDOT
220-G-311-04
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
10/11/2004
|
PERMIT
|
N/A
|
||||
47.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01461.55
|
DENTON
COUNTY DEPT OF PUBL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/11/2005
|
PERMIT
|
N/A
|
||||
48.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01462.55
|
DENTON
COUNTY DEPT OF PUBL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/11/2006
|
PERMIT
|
N/A
|
||||
49.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01463.55
|
DENTON
COUNTY DEPT OF PUBL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/11/2005
|
PERMIT
|
N/A
|
||||
50.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01469.55
|
ETHEL
ROBERTA FANNING ET A
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
6/17/2005
|
SURF
|
D206136009
|
||||
51.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01473.55
|
DOROTHY
GEBERT
|
SOUTHWESTERN
GAS PIPELINE INC
|
2/28/2002
|
PLROW
|
5111
|
3131
|
77442
|
||
52.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01474.55
|
SUSAN
HORD ACREY ET VIR
|
STAR
OF TEXAS ENERGY SERVICES INC
|
10/13/2005
|
PLROW
|
D205306818
|
||||
53.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01475.55
|
DORIS
S ERICKSON
|
STAR
OF TEXAS ENERGY SERVICES INC
|
1/17/2003
|
PLROW
|
D203078038
|
||||
54.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01476.55
|
GLEN
HYDE ET AL
|
CANTERA
GAS GATHERING INC
|
5/13/2002
|
SURF
|
5086
|
3219
|
61548
|
||
55.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01477.55
|
PHILLIP
K SOTEL 2000 TRUST
|
STAR
OF TEXAS ENERGY SERVICES INC
|
11/10/2003
|
PLROW
|
D203463901
|
||||
56.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01478.55
|
PHILLIP
K SOTEL 2000 TRUST
|
STAR
OF TEXAS ENERGY SERVICES INC
|
11/11/2003
|
PLROW
|
D203463902
|
||||
57.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01480.55
|
CITY
OF FORT WORTH
|
CHIEF
OIL & GAS LLC
|
6/16/2004
|
PLROW
|
30085
|
||||
58.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01482.55
|
UNION
PACIFIC RAILROAD CO
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
5/6/2005
|
PERMIT
|
236676
|
||||
59.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01485.55
|
ONCOR
ELECTRIC DELIVERY CO
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
2/11/2008
|
PERMIT
|
N/A
|
||||
60.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01500.55
|
BNSF
RAILWAY CO #08-35503
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
4/3/2008
|
PERMIT
|
N/A
|
||||
61.
|
651-A
|
ALLIANCE
PIPELINE
|
DENTON
|
TXPL01554.55
|
BNSF
RAILWAY CO #08-37356
|
COWTOWN
PIPELINE PTRS LP
|
9/9/2009
|
PERMIT
|
N/A
|
||||
62.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01577.55
|
JAMES
RUSSELL EGESTON MD
|
SOUTHWESTERN
GAS PIPELINE INC
|
3/12/2007
|
PLROW
|
D207107551
|
||||
63.
|
AL103
|
ALLIANCE
20" WEST LINE
|
TARRANT
|
TXPL01562.55
|
CITY
OF FORT WORTH
|
COWTOWN
PIPELINE LP
|
9/9/2009
|
PLROW
|
39098
|
||||
64.
|
AL104
|
ALLIANCE
20" EAST LINE
|
TARRANT
|
TXPL01376.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215318
|
||||
65.
|
AL104A1
|
ALLIANCE
8" COMMERCE A PAD TO COMMERCE B
|
DENTON
|
TXPL01374.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215302
|
||||
66.
|
AL104A2
|
ALLIANCE
COMMERCE LOOP - TECH CENTER 8"
|
DENTON
|
TXPL01379.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215293
|
||||
67.
|
AL104A2
|
ALLIANCE
COMMERCE LOOP - TECH CENTER 8"
|
TARRANT
|
TXPL01479.55
|
CITY
OF FORT WORTH
|
CHIEF
OIL & GAS LLC
|
4/24/2006
|
PERMIT
|
33445
|
||||
68.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
DENTON
|
TXPL01365.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
2009-23358
|
||||
69.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
DENTON
|
TXPL01366.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
2009-23357
|
||||
70.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
TARRANT
|
TXPL01378.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215303
|
||||
71.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
TARRANT
|
TXPL01380.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215312
|
||||
72.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
TARRANT
|
TXPL01381.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215294
|
||||
73.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
DENTON
|
TXPL01387.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
2009-23366
|
||||
74.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
DENTON
|
TXPL01455.55
|
DENTON
COUNTY DEPT OF PUBL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
4/28/2006
|
PERMIT
|
N/A
|
||||
75.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01406.55
|
DONALD
G MOORE ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
11/30/2005
|
PLROW
|
D205379417
|
||||
76.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01428.55
|
BAPTIST
MISSIONARY ASSOC
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
10/14/2005
|
PLROW
|
D206061773
|
||||
77.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01436.55
|
ONE
PRAIRIE MEADOWS LTD
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/12/2006
|
PLROW
|
D206061769
|
||||
78.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01438.55
|
GORDON
NEIL WHITE ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
8/10/2005
|
PLROW
|
D206119318
|
||||
79.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01439.55
|
MICHAEL
K DOTSON ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/5/2006
|
PLROW
|
D206017089
|
||||
80.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01440.55
|
MARTIN
LYNN GOWINS
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
3/13/2006
|
PLROW
|
D206080938
|
||||
81.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01441.55
|
JAMES
E FORMAN ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
8/14/2005
|
PLROW
|
D205379416
|
||||
82.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01442.55
|
MARTY
M MELVIN ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
8/4/2005
|
PLROW
|
D205379418
|
||||
83.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01445.55
|
ONE
WOODLAND SPRINGS
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/12/2006
|
PLROW
|
D206061768
|
||||
84.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01446.55
|
ONE
WOODLAND SPRINGS
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/12/2006
|
PLROW
|
D206061767
|
||||
85.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01456.55
|
TARRANT
COUNTY 06-30
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
3/10/2006
|
PERMIT
|
N/A
|
||||
86.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01457.55
|
TARRANT
COUNTY 06-09
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/23/2006
|
PERMIT
|
N/A
|
||||
87.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01458.55
|
TARRANT
COUNTY 06-10
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
1/23/2006
|
PERMIT
|
N/A
|
||||
88.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01465.55
|
GREG
ALUMBAUGH ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
4/18/2006
|
PLROW
|
05-37274-1
|
||||
89.
|
AL105D2
|
ALLIANCE
HINTON MELVIN LATERAL
|
TARRANT
|
TXPL01466.55
|
DARRYL
KAZEN ET UX
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
4/18/2006
|
PLROW
|
06-38618-1
|
||||
90.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TX4390901.55
|
MARTY
M MELVIN ET UX
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
8/4/2005
|
SURF
|
D205379419
|
||||
91.
|
AL104A2B
|
ALLIANCE
8" LAT TECH CTR S TO GRAPHIC
|
TARRANT
|
TXPL01448.55
|
ADL
DEVELOPMENT LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/1/2005
|
PLROW
|
D205357287
|
12/20/2007
|
D208026060
|
*
Insofar as, and only insofar as, the item covers tracts depicted in orange on
Schedule 1.2(e) Pipelines.
Schedule
5.5
Seller’s
Conflicts
None.
Schedule
5.7
Litigation
Dispute
with Exterran Energy Solutions, L.P. with respect to the following compression
services agreements:
1.
|
Schedule
‘A” to Master Compression Services Agreement dated September 10, 2008 by
and between Quicksilver Resources Inc. and Exterran Energy Solutions, L.P.
covering compression services for Alliance Gathering Station Unit
#1
|
2.
|
Schedule
‘A” to Master Compression Services Agreement dated September 10, 2008 by
and between Quicksilver Resources Inc. and Exterran Energy Solutions, L.P.
covering compression services for Alliance Gathering Station Unit
#2
|
3.
|
Schedule
‘A” to Master Compression Services Agreement dated September 10, 2008 by
and between Quicksilver Resources Inc. and Exterran Energy Solutions, L.P.
covering compression services for Alliance Gathering Station Unit
#3
|
4.
|
Schedule
‘A” to Master Compression Services Agreement dated September 10, 2008 by
and between Quicksilver Resources Inc. and Exterran Energy Solutions, L.P.
covering compression services for Alliance Gathering Station Unit
#3
|
Schedule
5.8
Taxes and
Assessments
None.
Schedule
5.9
Compliance with
Laws
Reference
is made to the items listed in Schedule 5.11 Governmental
Authorizations and Schedule 5.20 Environmental.
Schedule
5.10(a)
Material
Contracts
Item #
|
Date
|
Parties
|
Counterparties
|
Subject Matter
|
1.
|
10-01-2009
|
Cowtown
Pipeline L.P.
|
Devon
Energy Production Company
|
Gas
Gathering Agreement
|
2.
|
___*
|
Cowtown
Pipeline L.P.
|
Crosstex
|
Gas
Gathering Agreement
|
3.
|
12-01-2009
|
Cowtown
Pipeline L.P.
|
Quicksilver
Resources Inc.
|
Gas
Gathering Agreement
|
4.
|
08-21-2009
|
Cowtown
Pipeline L.P.
|
Denton
County Electric Cooperative
|
Agreement
for Provision of Electric Service
|
5.
|
08-21-2009
|
Cowtown
Pipeline L.P.
|
Denton
County Electric Cooperative
|
Transmission
Interconnection Requirements Agreement
|
6.
|
01-01-2006
|
Quicksilver
Resources Inc.
|
Universal
Compression, Inc.
|
Master
Compression Services Agreement
|
7.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P.
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #3)
|
8.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P.
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #2)
|
9.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P.
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #4)
|
10.
|
06-30-2009
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P.
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Pad Unit #5)
|
11.
|
06-30-2009
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P.
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Pad Unit #6)
|
12.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P.
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #1)
|
13.
|
04-01-2009
|
Cowtown
Pipeline L.P.
|
Eni
Petroleum US LLC
|
Gas
Gathering Agreement
|
* While
the parties to this agreement have agreed upon the terms of this agreement,
Crosstex has not yet executed this agreement.
Schedule
5.10(b)
Contract
Matters
Reference
is made to the item described on Schedule 5.7
Litigation.
Schedule
5.11
Governmental
Authorizations
Any
non-compliance that may result from the failure to comply with any Transfer
Requirement referenced in Schedule 5.12 Preference
Rights and Transfer Requirements involving a Governmental
Body.
Schedule
5.12
Preference Rights and
Transfer Requirements
I.
|
Preference
Rights: None
|
II.
|
Transfer
Requirements:
|
Item
#
|
Line
No.
|
Line
Name
|
County
|
File
No
|
Grantor
|
Original
Grantee
|
Agmt
Dated
|
File
Type
|
Recorded
- Book
|
Recorded
- Page
|
Document
#
|
Amended
Dated
|
Amendment
Recorded
|
A1.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01347.55
|
BNSF
RAILWAY CO #04-26236
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
A2.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01348.55
|
BNSF
RAILWAY CO #04-26238
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
A3.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01349.55
|
BNSF
RAILWAY CO #04-26240
|
CHIEF
OIL & GAS LLC
|
2/19/2004
|
PERMIT
|
N/A
|
||||
A4.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01361.55
|
ADL
DEVELOPMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215288
|
||||
A5.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01362.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215308
|
||||
A6.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01370.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215319
|
||||
A7.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01371.55
|
AIL
INVESTMENT LP
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
5/19/2008
|
PLROW
|
D208215320
|
||||
A8.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01373.55
|
AIL
INVESTMENT LP ET AL
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
7/1/2005
|
PLROW
|
D205357288
|
Effective
7/1/2005
|
D208215295
|
||
A9.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01471.55
|
FW
FORT WORTH 109 LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/4/2005
|
PLROW
|
D205055740
|
||||
A10.
|
651-A
|
ALLIANCE
PIPELINE
|
TARRANT
|
TXPL01472.55
|
FW
FORT WORTH 109 LP
|
EAGLE
MOUNTAIN PIPELINE CO LP
|
2/4/2005
|
PLROW
|
D205055741
|
||||
A11.
|
AL100
|
ALLIANCE
20" NORTH PIPELINE A
|
DENTON
|
TXPL01491.55
|
BNSF
RAILWAY CO #09-37662
|
COWTOWN
PIPELINE LP
|
3/26/2009
|
PERMIT
|
N/A
|
||||
A12.
|
AL102
|
ALLIANCE
20" NORTH PIPELINE C
|
DENTON
|
TXPL01404.55
|
MT
COLE TRUST NO 2 & 3
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
3/26/2008
|
PLROW
|
2008-36679
|
2/9/2009
|
2009-14364
|
||
A13.
|
AL102
|
ALLIANCE
20" NORTH PIPELINE C
|
DENTON
|
TXPL01404.55
|
MT
COLE TRUST NO 2 & 3
|
Effective
2/9/09
|
2009-117217
|
||||||
A14.
|
AL102
|
ALLIANCE
20" NORTH PIPELINE C
|
DENTON
|
TXPL01492.55
|
BNSF
RAILWAY CO #09-37663
|
COWTOWN
PIPELINE LP
|
3/26/2009
|
PERMIT
|
N/A
|
||||
A15.
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01419.55
|
M T
COLE TRUST NO 2 & 3
|
COWTOWN
PIPELINE LP
|
2/9/2009
|
PLROW
|
2009-14365
|
Effective
2/9/09
|
2009-117218
|
||
A16.
|
AL104
|
ALLIANCE
20" EAST LINE
|
DENTON
|
TXPL01493.55
|
BNSF
RAILWAY CO #09-37759
|
COWTOWN
PIPELINE LP
|
3/25/2009
|
PERMIT
|
N/A
|
||||
A17.
|
AL105D
|
ALLIANCE
12" GOLDEN ARBROOK
|
TARRANT
|
TXPL01396.55
|
CITY
OF FORT WORTH
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
3/20/2006
|
PLROW
|
33346
|
||||
A18.
|
ALEL100A1
|
ALLIANCE
DELIVERY POINT ELECTRIC LINE
|
TARRANT
|
TX4390900.55
|
BNSF
RAILWAY CO #09-37863
|
COWTOWN
PIPELINE LP
|
4/14/2009
|
PERMIT
|
N/A
|
||||
A19.
|
ALGL101A
|
ALLIANCE
COMMERCE LOOP
|
DENTON
|
TXPL01405.55
|
JEANNE
SHELTON
|
CHIEF
RESOURCES ALLIANCE PIPELINE LLC
|
12/18/2007
|
PLROW
|
2007-14660
|
Item #
|
Date
|
Parties
|
Counterparties
|
Subject Matter
|
B1.
|
01-01-2006
|
Quicksilver
Resources Inc.
|
Universal
Compression, Inc.
|
Master
Compression Services Agreement
|
B2.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #3)
|
B3.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #2)
|
B4.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #4)
|
B5.
|
06-30-2009
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Pad Unit #5)
|
B6.
|
06-30-2009
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Pad Unit #6)
|
B7.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #1)
|
B8.
|
09-10-2008
|
Quicksilver
Resources Inc.
|
Exterran
Energy Solutions, L.P..
|
Schedule
‘A’ to Master Compression Services Agreement
(Alliance
Gathering Station Unit #3)
|
B9.
|
05-13-2009
|
Quicksilver
Resources Inc.
|
Williams
Scotsman, Inc.
|
Lease
Agreement (modular office building)
|
Schedule
5.13
Outstanding Capital
Commitments
Order
#
|
Requisitioner
|
Rev
#
|
Dept
|
Order
Date
|
Description
|
Required
Date
|
Quantity
|
Effective
Date
|
Unit
Price
|
Buyer
|
Line
Total
|
Vendor
|
Status
|
Order
Currency
|
Base
Total
|
Total
Paid
|
Balance
|
09-0327
|
HBROWNE
|
1
|
MIDSTREAM
|
06-03-2009
|
Siemens
|
09-04-2009
|
2
|
300000.00
|
CCARMAN
|
600000.00
|
SIEMENS
|
Awarded
|
$600,000.00
|
$
687,352.25
|
$
259,373.00
|
$ 427,979.25
|
|
Base
Total :
|
|||||||||||||||||
09-0475
|
DKOBLINSKI
|
0
|
MIDSTREAM
|
11/6/2009
|
20
X .375" LP
|
1/18/2010
|
57000
|
$
43.99
|
HHUDLER
|
2507430
|
AMERICAN
STEEL PIPE
|
Awarded
|
$2,507,430.00
|
$
2,507,430.00
|
$ -
|
$ 2,507,430.00
|
|
09-0475
|
DKOBLINSKI
|
0
|
MIDSTREAM
|
11/6/2009
|
20
x .500" LP
|
1/18/2010
|
15000
|
$ 65.18
|
HHUDLER
|
977700
|
AMERICAN
STEEL PIPE
|
Awarded
|
$977,700.00
|
$
977,700.00
|
$ -
|
$ 977,700.00
|
|
Base
Total :
|
|||||||||||||||||
09-0397
|
HBROWNE
|
0
|
MIDSTREAM
|
08-18-2009
|
Cuttler
|
09-01-2009
|
1
|
08-18-2009
|
292500.00
|
HHUDLER
|
292500.00
|
ELLIOTT
|
Awarded
|
$292,500.00
|
$
307,304.00
|
$ 307,304.00
|
|
Base
Total :
|
|||||||||||||||||
09-0405
|
HMARSHALL
|
0
|
MIDSTREAM
|
08-26-2009
|
Enerflex
|
12-31-2009
|
4
|
08-26-2009
|
1821128.00
|
HHUDLER
|
7284512.00
|
ENERFLEX
|
Awarded
|
$7,284,512.00
|
$ 7,284,512.00
|
$ 728,451.20
|
$ 6,556,060.80
|
Base
Total :
|
|||||||||||||||||
09-0466
|
HMARSHALL
|
1
|
MIDSTREAM
|
10-30-2009
|
New
Natco
|
02-08-2010
|
1
|
744994.00
|
HHUDLER
|
744994.00
|
NATCO
|
Awarded
|
$744,994.00
|
$
744,994.00
|
$ -
|
$ 744,994.00
|
|
Base
Total :
|
|||||||||||||||||
09-0474
|
HMARSHALL
|
0
|
MIDSTREAM
|
11-05-2009
|
460
gpm
|
01-28-2010
|
1
|
11-05-2009
|
4483423.00
|
HHUDLER
|
4483423.00
|
SOUTHTEX
|
Awarded
|
$4,483,423.00
|
$ 4,855,780.00
|
$ 1,699,523.00
|
$ 3,156,257.00
|
09-0496
|
HMARSHALL
|
0
|
MIDSTREAM
|
11-20-2009
|
Virginia
|
03-05-2010
|
1
|
11-20-2009
|
221750.00
|
HHUDLER
|
221750.00
|
VIRGINIA
|
Awarded
|
$221,750.00
|
$ 436,750.00
|
$ -
|
$ 436,750.00
|
HMARSHALL
|
Virginia
|
1
|
215000.00
|
215000.00
|
Awarded
|
$215,000.00
|
Schedule
5.20
Environmental
Matters
Concrete
piers to support electrical conduit have been constructed at the
Facility. These piers were constructed prior to obtaining an
amendment to a Denton County Development Permit. An amendment is
currently being sought.
Schedule
5.21(b)
Title
Matters
1.
|
Pursuant
to a verbal agreement with representatives of ADL Development, L.P., AIL
Investment, L.P. and Alliance Center-West Association, Seller has
installed a 20” gas gathering pipeline and a 6” saltwater transportation
pipeline on land owned by those entities west of Farm Road 156 in Tarrant
County and Denton County, Texas. The lines have been
installed at or near an existing 12” gas gathering pipeline for which
Seller has an existing easement.
|
2.
|
The
following pipelines are currently in use by Seller although a written
agreement permitting such use has not been
located:
|
a.
|
Alliance 8-inch
Pipeline Near Haslet, Texas:
|
Consisting
of approximately 700 feet of the Alliance 8-inch (8”) pipeline situated in the
MEP & PRR Co. Survey, A-1132, and the C. Boyd Survey, A-225, Haslet, Tarrant
County, Texas, and being all that portion of said 8-inch pipeline located west
of BNSF Railroad and North and South of FM 718 (Avondale Haslet
Road). Approximately 200 feet of said 8-inch pipeline being
located north of FM 718 and west of BNSF Railroad and on lands that appear to be
owned by Tax Parcel Landowner Hall-Nance Ranch Ltd., and approximately 500 feet
of said 8-inch pipeline being located south of FM 718 and west of BNSF Railroad
and on lands that appear to be owned by Tax Parcel Landowner Triple T Farms
Ltd.
b.
|
Alliance G to J
10-inch Pipeline Near Haslet,
Texas:
|
Consisting
of approximately 950 feet of the Alliance G to J 10-inch (10”) pipeline situated
in the B. Lavois Survey, A-991, Haslet, Tarrant County, Texas, and being all
that portion of said 950 feet of 10-inch pipeline located immediately south of
and adjacent to Westport Parkway and west of and adjacent to Harmon
Road. The approximate most northern 300 feet of said 950 feet of
10-inch pipeline being located on lands that appear to be owned by Tax Parcel
Landowner City of Fort Worth, and the approximate southerly 650 feet of said 950
feet of 10-inch pipeline being located on lands that appear to be owned by Tax
Parcel Landowner RWJ Realty LLC.
AND:
Consisting
of approximately 2300 feet of the Alliance G to J 10-inch (10”) pipeline
situated in the WM Scott Survey, A-1957, Haslet, Tarrant County, Texas, and
being all that portion of the most southwesterly approximately 2300 feet of said
Alliance G to J 10-inch pipeline. The approximate 2300 feet of
said 10-inch pipeline being located on lands that appear to be owned by Tax
Parcel Landowner Fort Worth Railroad Salvage, Inc.
c.
|
Alliance 10-inch
Golden Arbrook Pipeline:
|
Consisting
of approximately 4000 feet of the 10-inch Golden Arbrook Pipeline situated in
the H. Davidson Survey, A-437, the J. Eastman Survey, A-901, the I&GNRR
Survey, A-827, and the W. McCowen Survey, A-999, Tarrant County, Texas, and
being all that portion of said 10-inch pipeline located north of Keller Hicks
Road and south of the AIL Investment, L.P. property that the Alliance Cozart
Well Pad is located on. The approximate most northern 3100 feet of said 4000
feet of 10-inch pipeline being located on lands that appear to be owned by Tax
Parcel Landowner State of Texas For The Benefit Of The Permanent School Fund,
and the approximate southern 900 feet of said 4000 feet of 10-inch pipeline
being located on lands that appear to be owned by Tax Parcel Landowner
Transcontinental Realty Investments.
Schedule
6.4(b)
Purchasers’
Conflicts
None.
Schedule
7.6
Operation of
Business
Operations
related to those items listed on Schedule 5.13 Outstanding
Capital Commitments.