FORMATION AND EXCHANGE AGREEMENT

Exhibit 10.10

FORMATION AND EXCHANGE AGREEMENT

BY AND AMONG

WILLIAMS FIELD SERVICES GROUP, LLC,

WILLIAMS LAUREL MOUNTAIN, LLC

ATLAS PIPELINE PARTNERS, L.P.

ATLAS PIPELINE OPERATING PARTNERSHIP, L.P.

and

APL LAUREL MOUNTAIN, LLC

March 31, 2009

TABLE OF CONTENTS

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TABLE OF CONTENTS

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TABLE OF CONTENTS

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TABLE OF CONTENTS

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Exhibits

 

 

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FORMATION AND EXCHANGE AGREEMENT

This Formation and Exchange Agreement (the “ Agreement ”) is made and entered into as of March 31, 2009, by and between Williams Field Services Group, LLC, a Delaware limited liability company (“ WFSG ”), Williams Laurel Mountain, LLC, a Delaware limited liability company (“ WFSG Sub ,” and with WFSG, the “ WFSG Parties ”), Atlas Pipeline Partners, L.P., a Delaware limited partnership (“ APL ”), Atlas Pipeline Operating Partnership, L.P., a Delaware limited partnership (“ APL Operating ”) and APL Laurel Mountain, LLC, a Delaware limited liability company (“ APL Sub ,” and with APL and APL Operating, the “ APL Parties ”).

W I T N E S S E T H:

WHEREAS, APL Operating owns 100% of the limited liability company membership interest of each of Atlas Pipeline New York, LLC, a Pennsylvania limited liability company (“ APL New York ”), Atlas Pipeline Ohio, LLC, a Pennsylvania limited liability company (“ APL Ohio ”), and Atlas Pipeline Pennsylvania, LLC, a Pennsylvania limited liability company (“ APL Pennsylvania ”); and APL Pennsylvania owns 100% of the limited liability company membership interests of Atlas Pipeline McKean, LLC, a Pennsylvania limited liability company (“ APL McKean ,” and collectively with APL New York, APL Ohio and APL Pennsylvania, the “ Subject Entities ”);

WHEREAS, the Subject Entities and Atlas America, LLC, a Pennsylvania limited liability company (“ Atlas LLC ”), collectively own the assets used or held for use in the conduct of the Appalachian Business;

WHEREAS, WFSG is in the business of owning and operating midstream natural gas assets;

WHEREAS, WFSG and APL desire to form a joint venture to acquire and own the Subject Entities and conduct the Appalachian Business;

WHEREAS, on the Closing Date, the following transactions will occur in sequential order:

(i) prior to the Closing, WFSG will cause WFSG Sub to form Laurel Mountain Midstream, LLC, a Delaware limited liability company (“ Newco ”), as a wholly-owned subsidiary of WFSG Sub; and immediately thereafter,

(ii) prior to the Closing, APL Operating will cause APL Sub to form Laurel Mountain Midstream Operating LLC, a Delaware limited liability company (“ Merger Sub ”), as a wholly-owned subsidiary of APL Sub; and immediately thereafter,

(iii) prior to the Closing, APL Operating, APL Pennsylvania and APL Sub will cause each of APL New York, APL Pennsylvania and APL McKean (the “ Merged Subject Entities ”) to merge with and into Merger Sub, pursuant to, and subject to the terms and conditions of, that certain Agreement and Plan of Merger and Reorganization, the form of which is attached hereto as Exhibit A (the “ Plan of Merger ”), and as a result of such merger (the “ Merger ”), all of the rights, privileges,

 

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powers and franchises the Merged Subject Entities, as well as all of the debts, liabilities and obligations of the Merged Subject Entities, will be vested by operation of Law in the Surviving Company (as defined herein);

(iv) prior to the Closing, APL Operating will contribute its 100% limited liability company membership interest in APL Ohio (the “ APL Ohio Interest ”) to APL Sub;

(v) prior to the Closing, WFSG will cause WFSG Sub to contribute $102 million in cash to Newco and issue to Newco a three-year note from WFSG Sub with a principal amount of $25.5 million, which note will be in the form attached hereto as Exhibit B (the “ WFSG Sub Note ”);

(vi) prior to the Closing, WFSG and WFSG Sub will cause Newco to purchase from Atlas LLC certain assets described in the ATN Asset Purchase Agreement that are used, held for use or intended to be used in the Appalachian Business (the “ ATN Assets ”); and immediately thereafter;

(vii) at the Closing, APL Sub will exchange 100% of the limited liability company membership interests in the Surviving Company (the “ Surviving Company Interest ”) and the APL Ohio Interest (collectively, with the Surviving Company Interest, the “ Exchanged Interests ”) with Newco for $87.795 million in cash and the issuance of a 49% limited liability company membership interest in Newco and the Preferred Distribution Rights (such limited liability company membership interest collectively with the Preferred Distribution Rights, the “ Subject Interest ”);

WHEREAS, concurrently with the Closing, WFSG Sub will contribute $2.295 million in cash to Newco as a capital contribution, while APL Sub has agreed to reduce the amount of cash otherwise payable to it by $2.205 million and instead allow such money to remain in Newco, resulting in a collective provision of $4.5 million of capital to Newco as initial working capital;

WHEREAS, following the Closing of the transactions contemplated under this Agreement, WFSG Sub will own a 51% limited liability company membership interest in Newco, and APL Sub will own a 49% limited liability company membership interest in Newco;

WHEREAS, on the Closing Date, Newco, APL, APL Operating, Atlas LLC, Resource Energy, LLC, a Delaware limited liability company (“ Resource Energy ”), Viking Resources, LLC, a Pennsylvania limited liability company (“ Viking Resources ”), Atlas Energy Resources, LLC, a Delaware limited liability company (“ ATN ”), Atlas Energy Operating Company, LLC, a Delaware limited liability company (“ ATN Operating ”), and Atlas Noble, LLC, a Delaware limited liability company (“ Atlas Noble ”) will enter into the Legacy System Gathering Agreement in the form attached hereto as Exhibit C (the “ Legacy System Gathering Agreement ”) and the Expansion System Gathering Agreement in the form attached hereto as Exhibit D (the “ Expansion System Gathering Agreement ,” and with the Legacy System Gathering Agreement, the “ Master Gathering Agreements ”);

WHEREAS, on the Closing Date, Atlas America, Inc., a Delaware corporation (“ Atlas America ”), Newco will enter into a Transition Services Agreement in the form attached hereto

 

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as Exhibit E (the “ Transition Services Agreement ”) pursuant to which Atlas America will provide certain services necessary to operate, manage, maintain and report the operating results of the Appalachian Assets and the Appalachian Business; and

NOW, THEREFORE, in consideration of the premises and the respective representations, warranties, covenants, agreements and conditions contained herein, the Parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Definitions . The respective terms defined in this Section 1.1 shall, when used in this Agreement, have the respective meanings specified herein, with each such definition equally applicable to both singular and plural forms of the terms so defined:

“ Accounting Arbitrator ” has the meaning ascribed to such term in Section 2.8(b) .

“ Adjustment Period ” means the period from (and including) April 1, 2009 to (but not including) the Closing Date.

“ Affiliate ” when used with respect to a Person, means any other Person that directly or indirectly controls, is controlled by or is under common control with such first Person. As of the date of this Agreement, the respective Affiliates of the parties hereto include those identified on Schedule 1.1(a) .

“ Aggregate Title Cap ” has the meaning ascribed to such term in Section 11.6 .

“ Aggregate Title Deductible ” has the meaning ascribed to such term in Section 11.6 .

“ Aggregate Title Defect Threshold ” has the meaning ascribed to such term in Section 11.6 .

“ Agreement ” has the meaning ascribed to such term in the preamble.

“ APL ” has the meaning ascribed to such term in the preamble.

“ APL Board ” means the board of directors of the APL General Partner.

“ APL Closing Certificate ” has the meaning ascribed to such term in Section 7.1(a) .

“ APL Conflicts Committee ” means the conflicts committee of the APL Board.

“ APL Credit Facility ” means the Revolving Credit and Term Loan Agreement and the Loan Documents (as defined therein), by and among, APL, APL Operating, the Subject Entities and Wachovia Bank, National Association, and the lenders named therein, dated as of July 27, 2007.

“ APL Fundamental Representations ” has the meaning ascribed to such term in Section 10.4 .

 

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“ APL General Partner ” means Atlas Pipeline Partners GP, LLC, a Delaware limited liability company and the general partner of APL and APL Operating.

“ APL Indemnified Parties ” has the meaning ascribed to such term in Section 10.2 .

“ APL Material Adverse Effect ” means any effect or change that is materially adverse to (a) the business, assets, liabilities, properties, financial condition or results of operations of the Subject Entities, taken as a whole, (b) the Appalachian Business or the Appalachian Assets, taken as a whole, or (c) the ability of any of the APL Parties to perform its obligations under this Agreement or to consummate the transactions contemplated hereby or (d) the ability of any member of the Appalachia Group to perform its obligations under any Transaction Document to which it is a party; provided, however, that an APL Material Adverse Effect shall not include any such adverse effect or change arising from or relating to (i) changes in state of the natural gas gathering industry generally (including any change in the price of natural gas, natural gas liquids or other hydrocarbons), (ii) changes in United States or global economic conditions or financial, banking, or securities markets (including any disruption thereof) in general, (iii) changes in national or international political or social conditions, including any engagement in hostilities, whether or not pursuant to the declaration of a national emergency or war, or the occurrence of any military or terrorist attack, (iv) changes in GAAP or in applicable Law, (v) the taking of any action expressly consented to by the WFSG Parties pursuant to Section 6.1(b) , (vi) the announcement of the execution of this Agreement or the Transaction Documents or the proposed or actual consummation of the transactions contemplated hereby and thereby, unless the execution, delivery and performance of this Agreement or the Transaction Documents would otherwise result in a breach of any Material Contract; provided , further, that in the case of clauses (i) , (ii)  and (iii)  the impact of such change is not materially disproportionate to the impact on similarly situated parties, including parties engaged in the gathering of natural gas anywhere within the United States.

“ APL McKean ” has the meaning ascribed to such term in the recitals.

“ APL New York ” has the meaning ascribed to such term in the recitals.

“ APL Ohio ” has the meaning ascribed to such term in the recitals.

“ APL Ohio Contribution Agreement ” has the meaning ascribed to such term in Section 2.2(c) .

“ APL Ohio Interest ” has the meaning ascribed to such term in the recitals.

“ APL Operating ” has the meaning ascribed to such term in the preamble.

“ APL Parties ” has the meaning ascribed to such term in the preamble.

“ APL Pennsylvania ” has the meaning ascribed to such term in the recitals.

“ APL Sub ” has the meaning ascribed to such term in the preamble.

 

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“ Appalachian Assets ” means (i) all of the assets and properties owned, used or held for use by any of the Subject Entities, including all those assets and properties listed on Schedules 4.6(b) through (e)  and (ii) the ATN Assets. For the avoidance of doubt, the Appalachian Assets do not include any assets permitted to be owned, developed or operated by a shipper pursuant to the terms of a gathering services agreement to which any of the Subject Entities is a party.

“ Appalachian Business ” means the natural gas gathering and transportation business and the natural gas liquids extraction business conducted utilizing the Appalachian System by APL and its Affiliates in western New York, eastern Ohio, western Pennsylvania and northern West Virginia. For the avoidance of doubt, the Appalachian Business does not include (i) the business of exploring or producing oil, gas or other hydrocarbons or (ii) the natural gas gathering business or natural gas liquids extraction business conducted by APL and its Affiliates outside of western New York, eastern Ohio, western Pennsylvania and northern West Virginia.

“ Appalachian Group ” means, collectively, the APL Parties, the Subject Entities and, at the Closing, the Merger Sub.

“ Appalachian Real Property ” means (i) the real property owned by the Subject Entities, and, in the case of the ATN Assets, the real property to be owned by Newco at the Closing, (ii) the leases and subleases under which any of the Subject Entities is lessee and, in the case of the ATN Assets, the leases and subleases under which Newco will be lessee at the Closing and (iii) the Easements used or held for use by the Subject Entities and, in the case of the ATN Assets, the Easements will be used or held for use by Newco at the Closing.

“ Appalachian System ” has the meaning ascribed to such term in Section 4.6(a) .

“ Atlas America ” has the meaning ascribed to such term in the recitals.

“ Atlas LLC ” has the meaning ascribed to such term in the recitals.

“ Atlas Marks ” has the meaning ascribed to such term in Section 6.12(a) .

“ Atlas Noble ” has the meaning ascribed to such term in the recitals.

“ ATN ” has the meaning ascribed to such term in the recitals.

“ ATN Asset Purchase Agreement ” means the Asset Purchase Agreement, to be dated as of the Closing Date, by and between Newco and Atlas LLC, in substantially the form attached hereto as Exhibit P .

“ ATN Assets ” has the meaning ascribed to such term in the recitals.

“ ATN Board ” means the board of directors of ATN.

“ ATN Conflicts Committee ” means the conflicts committee of the ATN Board.

“ ATN Operating ” has the meaning ascribed to such term in the recitals.

 

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“ Audited Liabilities ” has the meaning ascribed to such term in Section 2.7(b) .

“ Audited Statement of Assets and Liabilities ” has the meaning ascribed to such term in Section 6.7 .

“ Business Day ” means any day on which commercial banks are generally open for business in New York, New York and not a Saturday, a Sunday or a day observed as a holiday in New York, New York under the applicable Law of the State of New York or the United States of America.

“ Capital Account ” has the meaning ascribed to such term in the LLC Agreement.

“ Cash Purchase Price ” has the meaning ascribed to such term in Section 2.7(a) .

“ Ceiling Amount ” has the meaning ascribed to such term in Section 10.9(a) .

“ CERCLA ” means the Comprehensive Environmental Response, Compensation, and Liability Act.

“ Closing ” has the meaning ascribed to such term in Section 3.1 .

“ Closing Date ” has the meaning ascribed to such term in Section 3.1 .

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ Confidentiality Agreement ” has the meaning ascribed to such term in Section 6.2(b) .

“ Contract ” means any agreement, contract, lease, sublease, indenture, mortgage, license, concession, commitment, consensual obligation, promise or undertaking (whether written or oral and whether express or implied).

“ control ” and its derivatives, mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person.

“ CPR ” has the meaning ascribed to such term in Section 11.7 .

“ Cure Period ” has the meaning ascribed to such term in Section 11.2 .

“ DE Certificate of Merger ” has the meaning ascribed to such term in Section 2.2(b) .

“ Deductible Amount ” has the meaning ascribed to such term in Section 10.9(a) .

“ Defensible Title ” shall mean such title that, subject to Permitted Liens (except as qualified in the definition of Title Defect):

(i) with respect to the real property owned by the Subject Entities and, in the case of the ATN Assets, the real property to be owned by Newco at the Closing, is good title, free and clear of any Liens;

 

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(ii) with respect to the leases and subleases under which any of the Subject Entities is lessee and, in the case of the ATN Assets, the leases and subleases under which Newco will be lessee at the Closing is valid and subsisting, in full force and effect, and free and clear of all Liens; or

(iii) with respect to the Easements used or held for use by the Subject Entities and in the case of the ATN Assets, the Easements that will be used or held for use by Newco at the Closing, is defensible, and free and clear of all Liens.

“ Delaware Act ” means the Limited Liability Company Act of the State of Delaware, as amended.

“ Derivative Transaction ” means any futures, derivative, swap, collar, put, call, cap, warrant, option or other Contract that is intended to benefit from, relate to, or reduce or eliminate the risk of increases or decreases in interest rates, basis risk, or the price of commodities (including hydrocarbons), currencies, indexes, equity securities, bonds or loans, or any other similar transaction, to which a party or such party’s assets is bound.

“ Direct Costs ” means the direct transportation and compression expenses (including direct payroll and benefits costs of the Subject Employees, consistent with current levels), of the Subject Entities, on a consolidated basis, for the Adjustment Period. For the avoidance of doubt, the Direct Costs shall not include (A) allocations of any general and administrative costs and expenses or other overhead allocations and (B) non-cash expenses, such as depreciation.

“ Easements ” means any easements, rights of way, surface use agreements, servitudes, other real property rights and similar instruments with respect to the use or occupation of real property.

“ Effective Time ” has the meaning ascribed to such term in Section 2.2(b) .

“ Employee Plans ” has the meaning ascribed to such term in Section 4.14(a) .

“ Environmental Laws ” means, without limitation, any federal, state or local statutes, laws, ordinances, rules, regulations, orders, codes, decisions, injunctions or decrees that regulate or otherwise pertain to the protection of human health and safety, the environment or pollutants, contaminants, wastes or chemicals or any toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous or regulated substances, wastes, or materials, including the management, control, discharge, emission, treatment, containment, handling, removal, use, generation, permitting, migration, storage, release, transportation, disposal, remediation, manufacture, processing or distribution of Hazardous Materials that are or may present a threat to the environment including, but in no way limited to, the following laws, in effect as of the Closing Date or at any previous time, as in place or amended: (i) the Resource Conservation and Recovery Act; (ii) the Clean Air Act; (iii) CERCLA; (iv) the Federal Water Pollution Control Act; (v) the Safe Drinking Water Act; (vi) the Toxic Substances Control Act; (vii) the Emergency Planning and Community Right-to Know Act; (viii) the National Environmental Policy Act; (ix) the Pollution Prevention Act of 1990; (x) the Oil Pollution Act of 1990; (xi) the Hazardous Materials Transportation Act and (xii) all rules, regulations, orders, judgments, publications, or decrees promulgated or issued with respect to the foregoing by Governmental Authorities with appropriate jurisdiction.

 

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“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ Exchanged Interests ” has the meaning ascribed to such term in the recitals.

“ Excluded Assets ” has the meaning ascribed to such term in Section 6.13 .

“ Excluded Liabilities ” has the meaning ascribed to such term in Section 6.13 .

“ Expansion System Gathering Agreement ” has the meaning ascribed to such term in the recitals.

“ FERC ” means the U.S. Federal Energy Regulatory Commission.

“ GAAP ” means generally accepted accounting principles in the United States of America.

“ Governing Documents ” means, (i) with respect to a limited partnership, its certificate of limited partnership and its limited partnership agreement, or equivalent governing documents, and (ii) with respect to a limited liability company, its certificate of formation and its operating agreement, or equivalent governing documents.

“ Governmental Authority ” means any (a) national, state, county, municipal, or local government (whether domestic or foreign) and any political subdivision thereof, (b) any court or administrative tribunal, (c) any other governmental, quasi-governmental, judicial, public or statutory instrumentality, authority, body, agency, bureau or entity of competent jurisdiction (including any zoning authority, state public utility commission, FERC, or any comparable authority), (d) any non-governmental agency, tribunal or entity that is properly vested by a governmental authority with applicable jurisdiction, or (e) any arbitrator with authority to bind a party at law.

“ Hazardous Materials ” means any pollutant, contaminant, waste, or chemical, or any toxic, radioactive, ignitable, corrosive, reactive, or otherwise hazardous substance, waste or material, or any substance, waste or material having any constituent elements displaying any of the foregoing characteristics and regulated under any Environmental Law and any substance, whether solid, liquid, or gaseous: (i) which is listed, defined, or regulated as a “hazardous material,” “hazardous waste,” “solid waste,” “hazardous substance,” “toxic substance,” “pollutant,” or “contaminant,” or otherwise classified as hazardous or toxic, in or pursuant to any Environmental Law; or (ii) which is or contains asbestos, polychlorinated biphenyls, radon, urea formaldehyde foam insulation, explosives, or radioactive materials; or (iii) any petroleum, petroleum hydrocarbons, petroleum products, crude oil and any components, fractions, or derivatives thereof, any oil or gas exploration or production waste, and any natural gas, synthetic gas and any mixtures thereof; or (iv) which causes or poses a threat to cause contamination or nuisance on any properties, or any adjacent property or a hazard to the environment or to the health or safety of persons on or about any properties.

 

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“ Hired Employees ” shall have the meaning ascribed to such term in Section 6.11(a) .

“ HSR Act ” shall have the meaning ascribed to such term in Section 4.5(b) .

“ Indemnified Party ” means an APL Indemnified Party or a WFSG Indemnified Party.

“ Indemnifying Party ” has the meaning ascribed to such in term in Section 10.5 .

“ Indemnity Claim ” has the meaning ascribed to such term in Section 10.5 .

“ Individual Title Defect Threshold ” has the meaning ascribed to such term in Section 11.6 .

“ Initial Newco LLC Agreement ” has the meaning ascribed to such term in Section 2.1(a) .

“Insurance Policies ” has the meaning ascribed to such term in Section 4.15 .

“ Intellectual Property ” means all intellectual property rights, statutory or common law, worldwide, including (i) trademarks, service marks, trade dress, slogans, logos and all goodwill associated therewith, and any applications or registrations for any of the foregoing; (ii) copyrights and any applications or registrations for any of the foregoing; and (iii) patents, all confidential know-how, trade secrets and similar proprietary rights in confidential inventions, discoveries, improvements, processes, techniques, devices, methods, patterns, formulae, specifications, and lists of suppliers, vendors, customers, and distributors.

“ Knowledge ” means, (a) with respect to the APL Parties, the actual knowledge after reasonable inquiry of each person listed on Schedule 1.1(b), and (b) with respect to the WFSG Parties, the actual knowledge after reasonable inquiry of each person listed on Schedule 1.1(c) .

“ Law ” means all applicable statutes, law, rules, regulations, orders, ordinances, judgments and decrees of any Governmental Authority, including the common or civil law of any Governmental Authority.

“ Legacy System Gathering Agreement ” has the meaning ascribed to such term in the recitals.

“ Liabilities ” means liabilities and obligations, whether accrued, contingent, absolute, determined, determinable or otherwise, including all losses, deficiencies, costs, expenses, fines, interest, expenditures, claims, suits, proceedings, judgments, damages, and reasonable attorneys’ fees and reasonable expenses of investigating, defending and prosecuting litigation.

“ Lien ” means, with respect to any property or asset, any mortgage, deed of trust, lien, security interest, pledge, conditional sales contract, charge or encumbrance in respect of such property or asset.

“ LLC Agreement ” has the meaning ascribed to such term in Section 2.9 .

 

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“ Master Gathering Agreements ” has the meaning ascribed to such term in the recitals.

“ Material Contract ” has the meaning ascribed to such term in Section 4.12(a) .

“ Memoranda of Agreement ” means the memoranda of agreement relating to the Master Gathering Agreements entered into by and among APL, APL Operating, Atlas LLC, ATN, ATN Operating, Resource Energy, Viking Resources, Atlas Noble and Newco to be filed in each of the counties in the Commonwealth of Pennsylvania listed on Schedule 1.1(d) .

“ Merged Subject Entities ” has the meaning ascribed to such term in the recitals.

“ Merger ” has the meaning ascribed to such term in the recitals.

“ Merger Sub ” has the meaning ascribed to such term in the recitals.

“ Merger Sub Certificate of Formation ” has the meaning ascribed to such term in Section 2.1(b) .

“ Merger Sub LLC Agreement ” has the meaning ascribed to such term in Section 2.1(b) .

“ Month ” means, for purposes of Section 2.8 , a calendar month, so that a period of less than a full calendar month shall be represented by a fraction, the numerator of which is the number of days in such period and the denominator of which is the number of days in such calendar month.

“ Natural Gas Act ” means the Natural Gas Act of 1938, as amended.

“ Natural Gas Policy Act ” means the Natural Gas Policy Act of 1978, as amended.

“ Net Accumulated Cash Flow ” means, for the Adjustment Period, an amount (whether positive or negative) equal to the remainder of (A) the Net Revenues of the Subject Entities minus (B) the sum of (x) the Direct Costs of the Subject Entities, (y) Permitted Capital Expenditures of the Subject Entities, and (z) the Pro-Rata Allocation.

“ Net Revenues ” means the revenues of the Subject Entities, on a consolidated basis, for the Adjustment Period less related product costs.

“ Newco ” has the meaning ascribed to such term in the recitals.

“ Newco Certificate of Formation ” has the meaning ascribed to such term in Section 2.1(a) .

“ Note Guaranty Agreement ” has the meaning ascribed to such term in Section 2.3 .

“ Notice ” has the meaning ascribed to such term in Section 12.2 .

“ Notice of Disagreement ” has the meaning ascribed to such term in Section 2.8(b) .

 

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“ PA Certificate of Merger ” has the meaning ascribed to such term in Section 2.2(b) .

“ Parties ” means the parties to this agreement, the APL Parties and the WFSG Parties, collectively, and “ Party ” refers to any of them, individually; provided , where appropriate, Party refers to the APL Parties (collectively), on the one hand, and the WFSG Parties (collectively), on the other hand.

“ Pennsylvania Code ” means the Pennsylvania Consolidated Statutes, as amended.

“ Permits ” means all permits, licenses, certificates, orders, approvals, authorizations, registrations, grants, consents, concessions, warrants, franchises and similar rights and privileges granted by a Governmental Authority.

“ Permitted Capital Expenditures ” means the lesser of (A) the actual capital expenditures of the Subject Entities, on a consolidated basis, for the Adjustment Period or (B) $3.74 million times the number of Months in the Adjustment Period.

“ Permitted Liens ” means: (i) any mechanics’, materialmen’s, carriers’, workmen’s, repairmen’s, vendors’, operators’ or other like Liens, if any, arising in the ordinary course of business which accounts secured thereby are not past due or are being contested in good faith by appropriate proceedings and as to which adequate reserves have been established and that do not materially detract from the value of or materially interfere with the conduct of the Appalachian Business as currently conducted; (ii) any Liens arising under original purchase price conditional sales contracts and equipment leases with other Persons entered into in the ordinary course of business; (iii) any title defects or Liens that, individually or in the aggregate, do not or would not materially detract from the value, use or occupancy of the Appalachian Assets, taken as a whole, or materially interfere with the conduct of the Appalachian Business as currently conducted, except in each case for Liens securing the payment of indebtedness; (iv) any Liens for Taxes that are not due and payable or that may thereafter be paid without penalty or that are being contested in good faith by appropriate proceedings and as to which adequate reserves have been established; (v) liens supporting surety bonds, performance bonds and similar obligations issued in connection with the Appalachian Business in the ordinary course of such business; (vi) current zoning and subdivision Laws applicable to the Appalachian Assets; (vii) any covenants, conditions, restrictions or Liens contained in or otherwise created by the conveyance document filed of record creating any interest in the Appalachian Real Property; provided , that the Subject Entity that is bound by such covenant, condition, restriction or Lien, or with respect to the Appalachian Real Property that constitutes ATN Assets, ATN, or at the Closing, the Surviving Company or Newco, is not in violation or breach of such covenant, condition, restriction or Lien; (viii) the express terms and conditions of any Material Contract; (ix) any Lien that will be released on or prior to Closing; and (ix) any Lien listed on Schedule 1.1(e) .

“ Person ” means an individual or entity, including any partnership, corporation, association, trust, limited liability company, joint venture, unincorporated organization or Governmental Authority.

“ Personal Property ” has the meaning ascribed to such term in Section 4.6(e) .

“ Plan of Merger ” has the meaning ascribed to such term in the recitals.

 

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“ Post-Closing Adjustment Statement ” has the meaning ascribed to such term in Section 2.8(a) .

“ Preferred Distribution Rights ” has the meaning ascribed to such term in the LLC Agreement.

“ Prime Rate ” means, as of a particular date, the prime rate reported for such date in the Money Rates section of the Eastern Edition of The Wall Street Journal or, if such rate is not available, a comparable interest rate index that is readily available and verifiable, but is beyond the control of any party bound by the provisions of this Agreement.

“ Pro-Rata Allocation ” means $133,000 per month, pro-rated on a daily basis for each day of the Adjustment Period.

“ Proceeding ” means any action, suit, litigation, arbitration, proceeding (including any bankruptcy, civil, criminal, administrative, environmental, investigative or appellate proceeding and any informal proceeding), prosecution, contest, hearing, inquiry, inquest, audit, examination or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Authority.

“ Records ” has the meaning ascribed to such term in Section 4.18(b) .

“ Release ” means any depositing, spilling, leaking, pumping, pouring, placing, emitting, discarding, abandoning, emptying, discharging, migrating, injecting, escaping, leaching, dumping or disposing into the environment.

“ Required Permits ” has the meaning ascribed to such term in Section 4.11(a) .

“ Resolution Period ” has the meaning ascribed to such term in Section 2.8(b) .

“ Resource Energy ” has the meaning ascribed to such term in the recitals.

“ Review Period ” has the meaning ascribed to such term in Section 2.8(b) .

“ SCADA ” means supervisory control and data acquisition.

“ Schedules ” means the Schedules to this Agreement.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Solvent ” has the meaning ascribed to such term in Section 4.20 .

“ Subject Employees ” has the meaning ascribed to such term in Section 4.14(c) .

“ Subject Entities ” has the meaning ascribed to such term in the recitals.

“ Subject Interest ” has the meaning ascribed to such term in the recitals.

“ Submission Deadline Date ” has the meaning ascribed to such term in Section 2.8(b) .

 

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“ Surviving Company ” has the meaning ascribed to such term in Section 2.2(a) .

“ Surviving Company Interest ” has the meaning ascribed to such term in the recitals.

“ Tax ” or “ Taxes ” means (i) any federal, state, local or foreign income, gross receipts, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, custom duties, capital stock, franchise, profits, withholding, social security, unemployment, disability, real property, personal property, sale, use, transfer, registration, value added, escheat, unclaimed property, alternative or add on minimum, estimated or other tax of any kind whatsoever, (ii) any interest, penalty, fine, additions to Tax or additional amounts imposed by any Taxing Authority in connection with any item described in clause (i) , whether disputed or not, and (iii) any liability in respect of any item described in clauses (i)  or (ii)  payable by reason of contract, assumption, transferee liability, operation of law, Treasury Regulation Section 1.1502-6 or otherwise.

“ Taxing Authority ” means, with respect to any Tax, the governmental body, entity or political subdivision thereof that imposes such Tax, and the agency (if any) charged with the collection of such Tax for such entity or subdivision, including any governmental or quasi-governmental entity or agency that imposes, or is charged with collecting, social security or similar charges or premiums.

“ Tax Losses ” has the meaning ascribed to such term in Section 8.1(a) .

“ Tax Return ” means all reports, estimates, declarations of estimated Tax, information statements and returns relating to, or required to be filed in connection with, any Taxes, including information returns or reports with respect to backup withholding and other payments to other Persons.

“ Termination Date ” has the meaning ascribed to such term in Section 9.1(b) .

“ Title Arbitrator ” has the meaning ascribed to such term in Section 11.7 .

“ Title Claim Date ” has the meaning ascribed to such term in Section 11.1 .

“ Title Defect ” means any Lien, defect, or other matter that causes the Subject Entities, or in the case of the ATN Assets, Newco, not to have Defensible Title (provided, for purposes of this definition, the term Defensible Title shall not be qualified by clause (iii) of the definition of the term Permitted Liens) in and to the Appalachian Real Property as of the Closing Date; provided that the following shall not be considered Title Defects:

(a) defects in the chain of title consisting of the failure to recite marital status in a document or omissions of successions of heirship or estate proceedings, unless the WFSG Parties provide affirmative evidence that such failure or omission has resulted in another Person’s superior claim of title to the relevant Appalachian Real Property;

(b) defects arising out of lack of corporate or other entity authorization unless the WFSG Parties provide affirmative evidence that such corporate or other entity action was not authorized and results in another Person’s superior claim of title to the relevant Appalachian Real Property;

 

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(c) defects that are factually shown to be legally cured by applicable Laws of limitations or prescription;

(d) any Lien, defect or other matter affecting title to property that does not, in the jurisdiction where the property is located, constitute an exception or defect in title; and

(e) any Lien or loss of title resulting from Surviving Company’s conduct of business after the Closing Date.

“ Title Defect Amount ” has the meaning ascribed to such term in Section 11.3(a) .

“ Title Defect Notices ” has the meaning ascribed to such term in Section 11.1 .

“ Title Defect Property ” has the meaning ascribed to such term in Section 11.1 .

“ Title Indemnity Agreement ” has the meaning ascribed to such term in Section 11.3(b) .

“ Transaction Documents ” means the Plan of Merger, the LLC Agreement, the Transition Services Agreement, the Master Gathering Agreements, the WFSG Sub Note, the Note Guaranty Agreement, the Confidentiality Agreement, the APL Ohio Contribution Agreement, the ATN Asset Purchase Agreement, and the Assignment of Membership Interests.

“ Transition Services Agreement ” has the meaning ascribed to such term in the recitals.

“ Transfer Taxes ” has the meaning ascribed to such term in Section 8.3 .

“ Unaudited Liabilities ” has the meaning ascribed to such term in Section 2.7(b) .

“ Unaudited Statement of Assets and Liabilities ” has the meaning ascribed to such term in Section 4.23(a) .

“ Viking Resources ” has the meaning ascribed to such term in the recitals.

“ WARN Act ” has the meaning ascribed to such term in Section 6.11(a) .

“ WFSG ” has the meaning ascribed to such term in the preamble.

“ WFSG Board ” means the board of directors of WFSG.

“ WFSG Closing Certificate ” shall have the meaning ascribed to such term in Section 7.2(a) .

“ WFSG Fundamental Representations ” has the meaning ascribed to such term in Section 10.4 .

“ WFSG Indemnified Parties ” has the meaning ascribed to such term in Section 10.1 .

 

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“ WFSG Material Adverse Effect ” means any effect or change that would be materially adverse to (a) the ability of the WFSG Parties to perform their obligations under this Agreement or to consummate the transactions contemplated hereby or (d) the ability of the WFSG Parties or any of their Affiliates to perform its obligations under any Transaction Document to which it is a party; provided , however , that a WFSG Material Adverse Effect shall not include, any such adverse effect or change arising from or relating to (i) changes in state of the natural gas gathering industry generally (including any change in the price of natural gas, natural gas liquids or other hydrocarbons), (ii) changes in United States or global economic conditions or financial, banking, or securities markets (including any disruption thereof) in general, (iii) changes in national or international political or social conditions, including any engagement in hostilities, whether or not pursuant to the declaration of a national emergency or war, or the occurrence of any military or terrorist attack, (iv) changes in GAAP or in applicable Law, (v) the announcement of the execution of this Agreement and the Transaction Documents or the proposed or actual consummation of the transactions contemplated hereby and thereby; provided, further, that in the case of clauses (i) , (ii)  and (iii)  the impact of such change is not materially disproportionate to the impact on similarly situated parties, including parties engaged in the gathering of natural gas anywhere within the United States.

“ WFSG Parties ” has the meaning ascribed to such term in the preamble.

“ WFSG Sub ” has the meaning ascribed to such term in the preamble.

“ WFSG Sub Interest ” has the meaning ascribed to such term in Section 2.7(b) .

“ WFSG Sub Note ” has the meaning ascribed to such term in the recitals. The Parties agree that, solely for income tax purposes and the related purpose of maintaining Capital Accounts in accordance with Section 704(b) of the Code, the WFSG Sub Note shall not be treated as part of the Company (or any subsidiary of the Company) but shall be treated as beneficially owned for such purposes by the holder of the Preferred Distribution Rights, with the result that the Company will have no items of income, gain, loss, deduction or credit with respect to such WFSG Sub Note, and that such items will not increase or decrease the Capital Accounts of the APL Sub or WFSG Sub.

“ Williams ” has the meaning ascribed to such term in Section 3.3(b) .

1.2 Construction . In constructing this Agreement: (a) the word “includes” and its derivatives means “includes, without limitation” and corresponding derivative expressions; (b) the currency amounts referred to herein, unless otherwise specified, are in United States dollars; (c) whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified; (d) unless otherwise specified, all references in this Agreement to “Article,” “Section,” “Schedule,” “Exhibit,” “preamble” or “recitals” shall be references to an Article, Section, Schedule, Exhibit, preamble or recitals hereto; (e) whenever the context requires, the words used in this Agreement shall include the masculine, feminine and neuter and singular and the plural; (f) all words used as accounting terms and not otherwise defined in this Agreement has the meaning commonly applied to such term under GAAP; (g) the words “herein,” “hereby,” “hereof,” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Section or Article or other subdivision; (h)

 

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the terms “ordinary course” or “ordinary course of business” shall be deemed to refer to the conduct of the Appalachian Business in the ordinary course consistent with past practice; and (i) following the Effective Time, all references in this Agreement to the Subject Entities or Merger Sub shall be deemed to be, mutatis mutandis , references to the Surviving Company.

ARTICLE 2

FORMATION; CONTRIBUTION; EXCHANGE

2.1 Formation of Newco and Merger Sub .

(a) On the Closing Date, immediately prior to the transaction described in Section 2.1(b) , WFSG shall cause WFSG Sub to form Newco, by executing and delivering the limited liability company operating agreement in the form attached hereto as Exhibit F (the “ Initial Newco LLC Agreement ”) and filing a Certificate of Formation in the form attached hereto as Exhibit G (the “ Newco Certificate of Formation ”) with the Secretary of State of the State of Delaware. Upon such formation, WFSG Sub shall hold a 100% limited liability company membership interest in Newco.

(b) On the Closing Date, immediately following the transaction described in Section 2.1(a) and immediately prior to the transaction described in Section 2.2(a) , APL Operating shall cause APL Sub to form Merger Sub, by executing and delivering the limited liability company operating agreement in the form attached hereto as Exhibit H (the “ Merger Sub LLC Agreement ”) and filing a Certificate of Formation in the form attached hereto as Exhibit I (the “ Merger Sub Certificate of Formation ”) with the Secretary of State of the State of Delaware. Upon such formation, APL Sub shall hold a 100% limited liability company membership interest in Merger Sub.

2.2 Merger of Subject Entities and Merger Sub; Contribution of APL Ohio Interest .

(a) On the Closing Date, immediately following the transaction described in Section 2.1(b) and immediately prior to the transaction described in Section 2.5 , APL Operating, APL Pennsylvania and APL Sub shall cause the Merged Subject Entities to be merged with and into Merger Sub, with effect as of the Effective Time, and at such Effective Time the separate existence of the Merged Subject Entities shall cease, and Merger Sub shall be the surviving limited liability company of the Merger (the “ Surviving Company ”), in accordance with the terms and conditions of the Plan of Merger.

(b) Subject to the provisions of this Agreement, on the Closing Date, the Parties will (i) file with the Delaware Secretary of State a certificate of merger with respect to the Merger in substantially the form attached hereto as Exhibit J (the “ DE Certificate of Merger ”), duly executed and completed in accordance with the relevant provisions of the Delaware Act, and will make all other filings or recordings required under the Delaware Act to effect the Merger, and (ii) file with the Pennsylvania Secretary of the Commonwealth a certificate of merger with respect to the Merger in substantially the form attached hereto as Exhibit K (the “ PA Certificate of Merger ”), duly executed and completed in accordance with the relevant provisions of the Pennsylvania Code, and will make all other filings or recordings required under the Pennsylvania Code to effect the Merger. The Merger will become effective at such time as

 

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the DE Certificate of Merger and the PA Certificate of Merger have been duly filed with the Delaware Secretary of State and Pennsylvania Secretary of the Commonwealth, respectively, or at such other date or time as APL and WFSG may agree, which shall be specified in the DE Certificate of Merger and PA Certificate of Merger (the time at which the Merger becomes effective, the “ Effective Time ”).

(c) On the Closing Date, concurrently with the transaction described in Section 2.2(a) and immediately prior to the transaction described in Section 2.5 , (i) APL Operating and APL Sub shall enter into a contribution agreement in substantially the form attached hereto as Exhibit L (the “ APL Ohio Contribution Agreement ”) pursuant to which APL Operating shall contribute the APL Ohio Interest to APL Sub, and the transactions contemplated under such APL Ohio Contribution Agreement shall be consummated.

2.3 Capitalization of Newco . On the Closing Date, immediately following the transactions described in Section 2.2 and immediately prior to the transaction described in Section 2.4 , WFSG shall cause WFSG Sub to (a) contribute to Newco $102,000,000 in cash and (b) issue to Newco the WFSG Sub Note, and Williams shall guaranty WFSG Sub’s obligations to Newco under the WFSG Sub Note by executing and delivering the note guaranty agreement, attached hereto as Exhibit M (the “ Note Guaranty Agreement ”).

2.4 Purchase of ATN Assets . On the Closing Date, immediately following the transactions described in Section 2.3 and immediately prior to the transactions described in Section 2.5 , WFSG and WFSG Sub shall cause Newco to purchase from Atlas LLC the ATN Assets pursuant to the ATN Asset Purchase Agreement for $12.0 million, and the transactions contemplated under such ATN Asset Purchase Agreement shall be consummated.

2.5 Exchange . On the Closing Date, immediately following the transactions described in Section 2.4 , upon the terms and subject to the conditions set forth in this Agreement, APL Sub shall sell, assign, transfer and convey the Exchanged Interests to Newco, and WFSG and WFSG Sub shall cause Newco to purchase and acquire from APL Sub the Exchanged Interests in exchange for the issuance of the Subject Interest and payment of the Cash Purchase Price.

2.6 Capital Contribution . On the Closing Date, WFSG Sub will contribute $2.295 million in cash to Newco as a capital contribution to fund initial working capital.

2.7 Purchase Price .

(a) The aggregate consideration payable by Newco for the Exchanged Interests shall be (i) an amount in cash equal to $87,795,000 (the “ Cash Purchase Price ”); (ii) the issuance of the Subject Interest; and (iii) $2,205,000 as a deemed initial capital contribution to Newco by APL Sub; provided, however , that the amount of the Cash Purchase Price shall be subject to adjustment as provided in Section 2.7(b) .

(b) If the total amount of liabilities (excluding Excluded Liabilities and those liabilities with a related asset of a similar value) of the Subject Entities, on a consolidated basis, as set forth in the Audited Statement of Assets and Liabilities (the “ Audited Liabilities ”) allocable to WFSG Sub’s 51% limited liability company interest in Newco (the “ WFSG Sub

 

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Interest ”) exceeds the amount of liabilities (excluding Excluded Liabilities those liabilities with a related asset of a similar value) of the Subject Entities, on a consolidated basis, as set forth in the Unaudited Statement of Assets and Liabilities (the “ Unaudited Liabilities ”) allocable to the WFSG Sub Interest by more than $1,000,000, the amount of the Cash Purchase Price shall be decreased by an amount equal to (i) the excess of the amount of the Audited Liabilities allocable to the WFSG Sub Interest over the amount of the Unaudited Liabilities allocable to the WFSG Sub Interest, less (ii) $1,000,000.

2.8 Post-Closing Purchase Price Adjustment .

(a) As promptly as practicable after the Closing Date, and in any event not later than 30 days after the Closing Date, the APL Parties shall prepare and deliver to the WFSG Parties a statement (the “ Post-Closing Adjustment Statement ”) that sets forth its calculation, in reasonable detail, of the Net Accumulated Cash Flow. The WFSG Parties agree to provide the APL Parties and their authorized representatives reasonable access to such employees, offices, and other facilities and such books and records of Newco, the Surviving Company and APL Ohio as are reasonably necessary to allow the APL Parties and their authorized representatives to prepare the Post-Closing Adjustment Statement in accordance with this Section 2.8(a) .

(b) After receipt of the Post-Closing Adjustment Statement, the WFSG Parties shall have 30 days from receipt of the Post-Closing Adjustment Statement (the “ Review Period ”) to review such Post-Closing Adjustment Statement. In connection with the WFSG Parties’ review of, and in the case of any dispute with respect to, the Post-Closing Adjustment Statement, the APL Parties shall (i) provide the WFSG Parties and their authorized representatives access to the relevant books and records of the APL Parties and their Affiliates and authorized representatives, including the work papers of such authorized representatives, and (ii) furnish to the WFSG Parties any other information that relates to the Post-Closing Adjustment Statement, is reasonably requested and is relevant to the calculation of Net Accumulated Cash Flow. Unless the WFSG Parties provide written notice to the APL Parties of their disagreement as to one or more items included in the Post-Closing Adjustment Statement (“ Notice of Disagreement ”) prior to the expiration of the Review Period, the Post-Closing Adjustment Statement shall become final and binding on the APL Parties and WFSG Parties. A Notice of Disagreement shall set forth all of the WFSG Parties’ disputed items in the calculation of Net Accumulated Cash Flow, together with the WFSG Parties’ proposed changes thereto. If the WFSG Parties have delivered a timely Notice of Disagreement, then the APL Parties and the WFSG Parties shall use their good faith efforts to reach written agreement on the disputed items to determine the Net Accumulated Cash Flow, which in no event shall be more favorable to the APL Parties than reflected on the Post-Closing Adjustment Statement prepared by the APL Parties nor more favorable to the WFSG Parties than shown in the proposed changes delivered by the WFSG Parties pursuant to their Notice of Disagreement. If all of the WFSG Parties’ disputed items have not been resolved by the 30th day following the APL Parties’ receipt of the Notice of Disagreement (the “ Resolution Period ”), then the remaining disputed items shall be submitted to binding arbitration by an independent nationally recognized accounting firm (the “ Accounting Arbitrator ”) without any existing professional relationship with the APL Parties, the WFSG Parties or their respective Affiliates (or that had any such professional relationship within the past three years), as mutually selected by the APL Parties and the WFSG Parties (or in the absence of such agreement, by the CPR), within ten Business Days after the expiration of the

 

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Resolution Period. The Accounting Arbitrator shall act as an arbitrator to determine only those items in dispute. All fees and expenses relating to the work, to be performed by the Accounting Arbitrator shall be paid fifty percent (50%) by the APL Parties and fifty percent (50%) by the WFSG Parties . The APL Parties and the WFSG Parties shall provide information regarding the disputed items, and such supporting material as they deem reasonably appropriate, to the Accounting Arbitrator within five Business Days of the appointment of such Accounting Arbitrator (the “ Submission Deadline Date ”), and each Party shall provide a contemporaneous copy to the other Party of the disputed items (and supporting material, if any) submitted to the Accounting Arbitrator. The Accounting Arbitrator shall then prepare and deliver to the APL Parties or the WFSG Parties a written determination (such determination to include a work sheet setting forth all material calculations used in arriving at such determination and to be based solely on information provided to the Accounting Arbitrator by the Parties) of the Net Accumulated Cash Flow, including the disputed items, within 30 days following the Submission Deadline Date, which determination will be final, binding and conclusive on the Parties as to such disputed items.

(c) If the Net Accumulated Cash Flow, as finally determined, is a positive number, the APL Parties shall pay to the account designated by the WFSG Parties an amount equal to 51% of the Net Accumulated Cash Flow, plus interest on such amount (calculated on an annualized basis) from (and including) the Closing Date to (but excluding) the date of payment at the Prime Rate plus 2.0%. If the Net Accumulated Cash Flow, as finally determined, is a negative number, the WFSG Parties shall pay to the account designated by the APL Parties an amount equal to 51% of the Net Accumulated Cash Flow, plus interest on such amount (calculated on an annualized basis) from (and including) the Closing Date to (but excluding) the date of payment at the Prime Rate plus 2.0%. Any payment owing pursuant to this Section 2.8(c) shall be made by wire transfer of immediately available funds within two Business Days of the date the amount of the Net Accumulated Cash Flow is agreed or finally determined under Section 2.8(c) .

2.9 Adoption of LLC Agreement . On the Closing Date, immediately upon completion of the exchange described in Section 2.5 , WFSG and APL shall cause WFSG Sub and APL Sub, respectively, to execute and deliver the Amended and Restated Limited Liability Company Agreement of Newco, in the form attached hereto as Exhibit N (the “ LLC Agreement ”).

ARTICLE 3

CLOSING

3.1 Closing . The closing of the transactions contemplated by this Agreement (the “ Closing ”) shall be held at the offices of Jones Day, 222 East 41st Street, New York, New York 10017-6702 on the third Business Day following the date on which all of the conditions to closing set forth in Article 7 have been satisfied or waived, commencing at 10:00 a.m., New York time, or such other place, date and time as may be mutually agreed to in writing by the parties. The “ Closing Date ,” as referred to herein, shall mean the date of the Closing.

 

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3.2 Deliveries of the APL Parties at Closing . At the Closing, upon the terms and subject to the conditions of this Agreement, the APL Parties shall deliver or cause to be delivered the following:

(a) a duly executed assignment of membership interest, in substantially the form attached hereto as Exhibit O , transferring the Exchanged Interests to Newco;

(b) a certificate duly executed by an authorized officer of the APL General Partner, dated as of the Closing, (i) certifying on behalf of the each of the APL Parties that the conditions set forth in Section 7.1(a) have been fulfilled, (ii) setting forth the resolutions of the APL Board authorizing the execution and delivery of this Agreement, the Transaction Documents to which any of the APL Parties or their subsidiaries is a party and certifying that such resolutions were duly adopted and have not been rescinded or amended;

(c) a long-form certificate of good standing issued by the Secretary of the Commonwealth of the Commonwealth of Pennsylvania, as of a recent date prior to the Effective Time, of each of the Subject Entities;

(d) a certified copy from the Office of the Secretary of State of the State of Delaware of the Merger Sub Certificate of Formation, which shall be in full force and effect as of the Closing Date and shall not have been amended or modified, except as provided in the Plan of Merger;

(e) a certificate duly executed by the chairman of the APL Conflicts Committee certifying that such committee has approved the transactions contemplated by this Agreement and the Transaction Documents;

(f) a counterpart of the LLC Agreement, duly executed by APL Sub;

(g) counterparts of each of the Master Gathering Agreements, duly executed by each of APL, APL Operating, Atlas LLC, ATN, ATN Operating, Resource Energy, Viking Resources and Atlas Noble, respectively;

(h) counterparts of each of the Memoranda of Agreement, duly executed by memoranda of agreement by each of APL, APL Operating, Atlas LLC, ATN, ATN Operating, Resource Energy, Viking Resources and Atlas Noble, respectively;

(i) a counterpart of the Transition Services Agreement, duly executed by Atlas America;

(j) a counterpart of the ATN Asset Purchase Agreement and such bills of sale, deeds, assignments, certificates and other instruments in form acceptable for, and in sufficient duplicate originals to, allow recording in all appropriate jurisdictions and offices, in each case, duly executed by Atlas LLC;

(k) a counterpart of the APL Ohio Contribution Agreement, duly executed by APL Operating and APL Sub;

 

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(l) a certified copy from the Office of the Secretary of State of the State of Delaware of the DE Certificate of Merger, which shall be effective as of the Effective Time, as contemplated in Section 2.2 ;

(m) a certified copy from the Office of the Secretary of the Commonwealth of the Commonwealth of Pennsylvania of the PA Certificate of Merger, which shall be effective as of the Effective Time, as contemplated in Section 2.2 ;

(n) a copy of the Plan of Merger, duly executed by the parties thereto;

(o) a long-form certificate of good standing issued by the Secretary of State of the State of Delaware of the Surviving Company; and

(p) such other bills of sale, deeds, assignments, affidavits, certificates, cross receipts, instruments and documents as the WFSG Parties may reasonably request in order to consummate the transactions contemplated by this Agreement and the Transaction Documents.

3.3 Deliveries of the WFSG Parties at Closing . At the Closing, upon the terms and subject to the conditions of this Agreement, the WFSG Parties shall deliver or cause to be delivered the following:

(a) a copy of the WFSG Sub Note, duly executed on behalf of WFSG Sub;

(b) a counterpart of the Note Guaranty Agreement, pursuant to which The Williams Companies, Inc., a Delaware corporation (“ Williams ”), will guarantee WFSG Sub’s obligations under the WFSG Sub Note, duly executed on behalf of Williams;

(c) a certificate duly executed by an authorized officer of WFSG, dated as of the Closing, (i) certifying on behalf of the WFSG Parties that the conditions set forth in Section 7.2(a) have been fulfilled and (ii) setting forth the resolutions of the WFSG Board authorizing the execution and delivery of this Agreement, the Transaction Documents to which the WFSG Parties or any of their subsidiaries is a party and certifying that such resolutions were duly adopted and have not been rescinded or amended;

(d) a counterpart of the LLC Agreement, duly executed by WFSG Sub;

(e) a certified copy from the Office of the Secretary of State of the State of Delaware of the Newco Certificate of Formation, which shall be in full force and effect and shall not have been amended or modified; and

(f) a long-form certificate of good standing issued by the Secretary of State of the State of Delaware of Newco.

3.4 Deliveries of Newco at Closing . At the Closing, upon the terms and subject to the conditions of this Agreement, the WFSG Parties shall cause Newco to deliver the following:

(a) a counterpart of each of the Master Gathering Agreements, duly executed on behalf of Newco;

 

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(b) a counterpart of each of the Memoranda of Agreement, duly executed on behalf of Newco;

(c) a counterpart of the Transition Services Agreement, duly executed on behalf of Newco;

(d) a counterpart of the ATN Asset Purchase Agreement, duly executed on behalf of Newco;

(e) a wire transfer to APL Sub, in an amount equal to the Cash Purchase Price, of immediately available funds to an account designated in writing by APL; provided , APL shall designate such account at least two Business Days prior to Closing; and

(f) a copy of member resolutions of Newco, in form and substance reasonably acceptable to APL Sub, authorizing the issuance of membership interests in Newco, duly executed on behalf of WFSG Sub, the sole member.

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF THE APL PARTIES

Except as set forth in the Schedules delivered to the WFSG Parties by the APL Parties, the APL Parties jointly and severally represent and warrant to the WFSG Parties as follows:

4.1 Organization .

(a) Each of APL and APL Operating is a limited partnership duly organized, validly existing and in good standing under the Laws of the State of Delaware and has all requisite limited partnership power and authority to own, operate and lease its properties and assets and to carry on its business.

(b) APL Sub is a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Delaware and has all requisite limited liability company power and authority to own, operate and lease its properties and assets and to carry on its business.

(c) Each of the Subject Entities is a limited liability company duly organized, validly existing and in good standing under the Laws of the Commonwealth of Pennsylvania and has all requisite limited liability company power and authority to own, operate and lease its properties and assets and to carry on its business as now conducted. Each of the Subject Entities is duly licensed or qualified to do business and is in good standing in the states in which the character of the properties and assets owned or held by it or the nature of the business conducted by it requires it to be so licensed or qualified, and each of such states is set forth on Schedule 4.1(c) hereto.

(d) The APL Parties have made available to the WFSG Parties complete and correct copies of the Governing Documents of each of the Subject Entities.

 

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(e) Merger Sub will be formed on the Closing Date immediately prior to Closing solely for the purpose of engaging in the transactions contemplated by this Agreement and the Transaction Documents. Prior to the Closing, Merger Sub will have engaged in no other business activities and will have incurred no liabilities or obligations other than as contemplated herein or in the Transaction Documents. Upon such formation, Merger Sub will be a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Delaware and will have all requisite limited liability company power and authority to own, operate and lease its properties and assets and to carry on its business, including ownership of the assets of the Subject Entities and the conduct of their respective businesses.

4.2 Capitalization .

(a) APL General Partner is the sole owner of all of the outstanding general partnership interests of APL Operating and all of such general partnership interests have been duly authorized and validly issued in accordance with applicable Laws and the Governing Documents of APL Operating; and APL is the sole owner of all of the outstanding limited partnership interests of APL Operating and all of such limited partnership interests have been duly authorized and validly issued in accordance with applicable Laws and the Governing Documents of APL Operating and are fully paid and nonassessable. Other than such general partnership interests and limited partnership interests owned by APL General Partner and APL, respectively, there are no other outstanding equity interests in APL Operating.

(b) APL Operating is the sole owner of 100% of the outstanding limited liability company membership interests of each of APL New York, APL Ohio and APL Pennsylvania, and all of such membership interests have been duly authorized and validly issued in accordance with applicable Laws and the respective Governing Documents of each such Subject Entity and are fully paid and nonassessable. Other than such limited liability company membership interests owned by APL Operating, there are no other outstanding equity interests in any of APL New York, APL Ohio or APL Pennsylvania.

(c) APL Pennsylvania is the sole owner of 100% of the outstanding limited liability company membership interests of APL McKean, and all of such membership interests have been duly authorized and validly issued in accordance with applicable Laws and the Governing Documents of APL McKean and are fully paid and nonassessable. Other than such limited liability company membership interests owned by APL Pennsylvania, there are no other outstanding equity interests in APL McKean.

(d) APL Operating is the sole owner of 100% of the outstanding limited liability company membership interests of APL Sub, and all of such membership interests have been duly authorized and validly issued in accordance with applicable Laws and the Governing Documents of APL Sub and are fully paid and nonassessable. Other than such limited liab