CONTRIBUTION AGREEMENT

Contribution Agreement

You are currently viewing:

This Contribution Agreement involves

BREITBURN ENERGY CORPORATION | BREITBURN ENERGY PARTNERS LP | BREITBURN GP, LLC | BREITBURN MANAGEMENT COMPANY, LLC

. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here.

Title: CONTRIBUTION AGREEMENT
Governing Law: California Date: 6/23/2008
Industry: Oil and Gas - Integrated Law Firm: Vinson Elkins Sector: Energy

Exhibit 10.3

CONTRIBUTION AGREEMENT

Among

BREITBURN MANAGEMENT COMPANY, LLC

a Delaware limited liability company

BREITBURN GP, LLC

a Delaware limited liability company

BREITBURN ENERGY CORPORATION

a California corporation

and

BREITBURN ENERGY PARTNERS L.P.

a Delaware limited partnership

dated as of June 17, 2008

TABLE OF CONTENTS

		Page
ARTICLE I

DEFINITIONS

ARTICLE II

CONTRIBUTION TRANSACTIONS

Section 2.1	Cancellation of Common Units Acquired from Pro LP and Pro GP	4
Section 2.2	Contribution of BMC Membership Interest to the Partnership	4
Section 2.3	Distribution of GP Membership Interest to the Partnership	4
Section 2.4	Elimination of Economic Interest	4
Section 2.5	Amendment of GP LLC Agreement	4
Section 2.6	Amendment of Partnership Agreement	4
Section 2.7	Continuation of BMC	4
Section 2.8	Continuation of GP LLC	5
Section 2.9	Tax Election	5

A RTICLE III

REPRESENTATIONS AND WARRANTIES OF BEC

Section 3.1	Organization	5
Section 3.2	Ownership of BMC Membership Interest	5
Section 3.3	Authorization; Execution and Delivery of Agreement	5
Section 3.4	Restricted Securities	6
Section 3.5	Legend	6

A RTICLE IV

REPRESENTATIONS AND WARRANTIES OF BMC

Section 4.1	Organization	6
Section 4.2	Ownership of GP Membership Interest	6
Section 4.3	Authorization; Execution and Delivery of Agreement	6

A RTICLE V

REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP

Section 5.1	Organization	7
Section 5.2	Authorization; Execution and Delivery of Agreements	7
Section 5.3	Common Units	7

A RTICLE VI

INDEMNIFICATION

Section 6.1	Survival	8
Section 6.2	Indemnification Coverage	8
Section 6.3	Procedures	9
Section 6.4	Waiver of Consequential, Etc. Damages	10
Section 6.5	Compliance with Express Negligence Rule	10
Section 6.6	Remedy	10

A RTICLE VII

MISCELLANEOUS PROVISIONS

Section 7.1	Order of Completion of Transactions	10
Section 7.2	Successors and Assigns; No Third Party Beneficiaries	10
Section 7.3	Fees and Expenses	11
Section 7.4	Notices	11
Section 7.5	Entire Agreement	12
Section 7.6	Amendments	12
Section 7.7	Severability	12
Section 7.8	Titles and Headings	13
Section 7.9	Signatures and Counterparts	13
Section 7.10	Enforcement of Agreement; Damages	13
Section 7.11	Governing Law	13

EXHIBITS

Exhibit A — Restated GP LLC Agreement

Exhibit B — Partnership Agreement Amendment

iii

CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (this “ Agreement ”) is made and entered into as of this 17 ^th day of June, 2008, by and among BREITBURN MANAGEMENT COMPANY, LLC, a Delaware limited liability company (“ BMC ”), BREITBURN GP, LLC, a Delaware limited liability company (“ GP LLC ”), BREITBURN ENERGY CORPORATION, a California corporation (“ BEC ”), and BREITBURN ENERGY PARTNERS L.P., a Delaware limited partnership (the “ Partnership ”).

W I T N E S S E T H:

WHEREAS , on the date hereof, the Partnership has purchased 14,404,962 Common Units from Pro LP and Pro GP pursuant to the Common Unit Purchase Agreement;

WHEREAS , on the date hereof, the Partnership has purchased a 95.55% limited liability company interest in BMC from Pro LP and Pro GP pursuant to the BMC Purchase Agreement and Pro LP and Pro GP have ceased to be members of BMC;

WHEREAS , BEC holds the remaining issued and outstanding 4.45% limited liability company interest in BMC (the “ BMC Membership Interest ”);

WHEREAS , BEC desires to contribute such BMC Membership Interest to the Partnership in exchange for Common Units and cease to be a member of BMC, upon the terms and subject to the conditions set forth in this Agreement;

WHEREAS , the Partnership desires to be admitted to BMC as the sole member of BMC;

WHEREAS , BMC owns a 100% limited liability company interest in GP LLC (the “ GP Membership Interest ”);

WHEREAS , BMC desires to distribute such GP Membership Interest to the Partnership and cease to be a member of GP LLC, upon the terms and subject to the conditions set forth in this Agreement;

WHEREAS , the Partnership desires to be admitted to GP LLC as the sole member of GP LLC;

WHEREAS , GP LLC desires to eliminate the entire economic portion of its 0.66473% general partner interest in the Partnership (the “ Economic Interest ”) but remain general partner of the Partnership;

WHEREAS , the Partnership desires to amend and restate the GP LLC Agreement to provide for, among other items, the election of directors of the board of directors of GP LLC by the limited partners of the Partnership;

WHEREAS , GP LLC desires to amend the Partnership Agreement to provide for, among other items, the elimination of the Economic Interest and the election of directors of the board of directors of GP LLC by the limited partners of the Partnership; and

WHEREAS , in connection with the foregoing, BMC desires to make an election to be treated as an association taxable as a corporation for U.S. federal income tax purposes.

NOW, THEREFORE , in consideration of the mutual terms, conditions and other agreements set forth herein, the parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

As used herein, the following terms have the following meanings:

“ Affiliate ” of a Person means a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, the first-mentioned Person.

“ Agreement ” has the meaning assigned to such term in the Preamble.

“ BEC ” has the meaning assigned to such term in the Preamble.

“ BEC Indemnified Parties ” has the meaning assigned to such term in Section 6.2(b) .

“ BMC ” has the meaning assigned to such term in the Recitals.

“ BMC LLC Agreement ” means the First Amended and Restated Limited Liability Company Agreement of BMC dated as of October 10, 2006, as amended.

“ BMC Membership Interest ” has the meaning assigned to such term in the Recitals.

“ BMC Purchase Agreement ” shall mean that certain Purchase Agreement dated as of the date hereof, by and among Pro LP, Pro GP and the Partnership for the purchase and sale of all of the issued and outstanding limited liability company interests of BMC owned by Pro LP and Pro GP.

“ Closing ” means the closing of the transactions contemplated by this Agreement.

“ Common Units ” shall mean common units representing limited partner interests in the Partnership.

“ Common Unit Purchase Agreement ” shall mean that certain Purchase Agreement dated as of the date hereof, by and among Pro LP, Pro GP and the Partnership for the purchase and sale of 14,404,962 Common Units owned by Pro LP and Pro GP.

“ Economic Interest ” shall have the meaning assigned to such term in the Recitals.

“ Encumbrances ” shall have the meaning assigned to such term in Section 3.1 .

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ GP LLC ” has the meaning assigned to such term in the Preamble.

“ GP LLC Agreement ” means the First Amended and Restated Limited Liability Company Agreement of GP LLC dated as of October 10, 2006.

“ GP Membership Interest ” has the meaning assigned to such term in the Recitals.

“ Indemnified Party ” has the meaning assigned to such term in Section 6.2(c)(i) .

“ Indemnifying Party ” has the meaning assigned to such term in Section 6.2(c)(i) .

“ Loss ” or “ Losses ” has the meaning assigned to such term in Section 6.2(a) .

“ Partnership ” has the meaning assigned to such term in the Recitals.

“ Partnership Agreement ” shall mean the First Amended and Restated Agreement of Limited Partnership of the Partnership, dated October 10, 2006.

“ Partnership Agreement Amendment ” has the meaning assigned to such term in Section 2.6 .

“ Partnership Indemnified Parties ” has the meaning assigned to such term in Section 6.2(a) .

“ Person ” shall mean an individual, corporation, association, trust, limited liability company, limited partnership, limited liability partnership, partnership, incorporated organization, other entity or group (as defined in Section 13(d)(3) of the Exchange Act).

“ Pro GP ” shall mean Pro GP Corp., a Delaware corporation.

“ Pro LP ” shall mean Pro LP Corp., a Delaware corporation.

“ Restated GP LLC Agreement ” has the meaning assigned to such term in Section 2.5 .

“ SEC ” shall mean the United States Securities and Exchange Commission.

“ Securities Act ” shall mean the Securities Act of 1933, as amended.

“ Subsidiary ” when used with respect to any party means any corporation or other organization of which such party directly or indirectly owns at least a majority of the securities or other interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other organization.

“ Transaction Documents ” shall mean any agreements, contracts, documents, instruments and certificates provided for in this Agreement to be entered into by one or more of the parties hereto or any of their Affiliates in connection with the transactions contemplated by this Agreement, including the Partnership Agreement Amendment and the Restated GP LLC Agreement.

ARTICLE II

CONTRIBUTION TRANSACTIONS

Upon the consummation of the transactions contemplated in the Common Unit Purchase Agreement and the BMC Purchase Agreement, and subject to the terms and conditions of this Agreement, the parties acknowledge and agree that the following transactions hereby occur in the following order effective as provided in Section 7.1 :

Section 2.1 Cancellation of Common Units Acquired from Pro LP and Pro GP . The 14,404,962 Common Units received by the Partnership pursuant to the Common Unit Purchase Agreement are hereby cancelled without consideration therefore and without further action by any Person.

Section 2.2 Contribution of BMC Membership Interest to the Partnership . BEC hereby contributes and assigns the BMC Membership Interest to the Partnership, and the Partnership hereby accepts such BMC Membership Interest in exchange for the issuance of 19,955 Common Units to BEC. The Partnership shall deliver the Common Units being issued to BEC pursuant to this Section 2.2 by delivering one or more certificates (bearing the legend set forth in Section 3.5 and any other legends required by the Partnership Agreement) evidencing such Common Units to BEC on the date hereof.

Section 2.3 Distribution of GP Membership Interest to the Partnership . BMC hereby distributes and assigns the GP Membership Interest to the Partnership, and the Partnership hereby accepts such GP Membership Interest.

Section 2.4 Elimination of Economic Interest . The Economic Interest is hereby and pursuant to the Partnership Agreement Amendment eliminated without consideration therefor and without any further action by any Person.

Section 2.5 Amendment of GP LLC Agreement . Pursuant to Section 3.1 of the GP LLC Agreement, the GP LLC Agreement is amended and restated in its entirety by the second amendment and restatement thereof in the form attached hereto as Exhibit A (the “ Restated GP LLC Agreement ”).

Section 2.6 Amendment of Partnership Agreement . Pursuant to Section 13.1(d)(i) of the Partnership Agreement, the Partnership Agreement is amended by Amendment No. 1 thereto in the form attached hereto as Exhibit B (the “ Partnership Agreement Amendment ”).

Section 2.7 Continuation of BMC . The Partnership hereby agrees that it is bound by the terms and conditions of the BMC LLC Agreement. Notwithstanding any provision in the BMC LLC Agreement, the Partnership is hereby admitted to BMC as the sole member of BMC simultaneously with the consummation of the contribution and assignment of the BMC Membership Interest by BEC to the Partnership contemplated hereby, and immediately thereafter, BEC shall and does hereby cease to be a member of BMC, and shall thereupon cease to have or exercise any right or power as a member of BMC. The parties hereto agree that the contribution and assignment of the BMC Membership Interest from BEC to the Partnership, the Partnership’s admission as the sole member of BMC and BEC ceasing to be a member of BMC, shall not dissolve BMC, and BMC shall be continued without dissolution.

Section 2.8 Continuation of GP LLC . The Partnership hereby agrees that it is bound by the terms and conditions of the GP LLC Agreement. Notwithstanding any provision in the GP LLC Agreement, the Partnership is hereby admitted to GP LLC as the sole member of GP LLC simultaneously with the consummation of the distribution and assignment of the GP Membership Interest by BMC to the Partnership contemplated hereby, and immediately thereafter, BMC shall and does hereby cease to be a member of GP LLC, and shall thereupon cease to have or exercise any right or power as a member of GP LLC. The parties hereto agree that the distribution and assignment of the GP Membership Interest by BMC to the Partnership, the Partnership’s admission as the sole member of GP LLC and BMC ceasing to be a member of GP LLC, shall not dissolve GP LLC, and GP LLC shall be continued without dissolution.

Section 2.9 Tax Election . The parties hereby acknowledge that BMC will make an election to be treated as an association taxable as a corporation for U.S. federal income tax purposes.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF BEC

As of the date hereof, BEC hereby represents and warrants to the Partnership as follows:

Section 3.1 Organization . BEC has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of California. BEC has all requisite corporate power and authority and all governmental licenses, authorizations, permits, consents and approvals to own its respective properties and assets and to conduct its business as now conducted. BEC is duly qualified to do business as a foreign entity and is in good standing in each jurisdiction where the character of the properties owned or leased by it or the nature of the business conducted by it makes such qualification necessary.

Section 3.2 Ownership of BMC Membership Interest . BEC is the record and beneficial owner of the BMC Membership Interest. BEC owns the BMC Membership Interest free and clear of any pledges, restrictions on transfer, proxies and voting or other agreements, liens, claims, charges, mortgages, security interests or other legal or equitable encumbrances, limitations or restrictions of any nature whatsoever (“ Encumbrances ”), except for restrictions on transfer arising under applicable securities laws. Except as set forth in the BMC LLC Agreement, there are no preemptive or other rights to subscribe for or to purchase, nor any restriction upon the voting or transfer of, any interest in BMC pursuant to any agreement to which BMC or BEC is a party or to which any of them may be bound. There are no outstanding options, warrants or similar rights to purchase or acquire any equity interests in BMC.

Section 3.3 Authorization ; Execution and Delivery of Agreement . BEC has the power a

SITE SEARCH

AGREEMENTS / CONTRACTS

CLAUSES

Search Contract Clauses >>

Browse Contract Clause Library>>

Get Email Updates