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Exhibit 10.36
CONTRIBUTION, ASSUMPTION AND CONVEYANCE
AGREEMENT
THIS CONTRIBUTION, ASSUMPTION AND CONVEYANCE AGREEMENT , dated
as of November 1, 2006, is entered into by and between
ENERGY TRANSFER EQUITY, L.P., a Delaware limited partnership
(" ETE ") and ENERGY TRANSFER INVESTMENTS,
L.P., a Delaware limited partnership (" ETI ").
The parties to this agreement are collectively referred to herein
as the " Parties . " Capitalized terms used herein
shall have the meanings assigned to such terms in
Section 1.1.
RECITALS
WHEREAS , ETI owns a 50% Class B limited partner interest (the "
IDR Interest ") in Energy Transfer Partners GP, L.P.
(" ETP GP ");
WHEREAS , ETI is a party that certain Credit and Guaranty
Agreement, dated as of April 24, 2006, as amended by that
certain Amendment Number 1 to Credit and Guaranty Agreement, dated
as of July 21, 2006, naming ETI, UBS AG, Stamford Branch, as
Administrative Agent and Collateral Agent, UBS Securities LLC as
Arranger and the lenders from time to time party thereto (the
"Lenders") (the " Loan Agreement ");
WHEREAS , ETI proposes to assign and transfer all of its
rights and obligations under the Loan Agreement to ETE;
WHEREAS , ETI desires to assign all of its rights and
obligations under the Loan Agreement and ETE desires to accept such
assignment and assume such obligations;
WHEREAS , ETI desires to contribute the IDR Interest to
ETE in exchange for 83,148,900 Class C common units in ETE (the "
Class C Units "), the assumption of the Loan
Agreement by ETE, and ETE desires to issue the Class C units
and accept the assignment of, and assume the obligations of ETI,
the Loan Agreement in exchange for the IDR Interest; and
WHEREAS , the Class C Units will have the characteristics
set forth in Amendment No. 1 to the Third Amended and Restated
Agreement of Limited Partnership of ETE, a copy of which is
attached hereto as Exhibit A (" Amendment
No. 1 ").
NOW, THEREFORE , in consideration of the premises,
warranties, covenants and agreements contained herein, the parties
agree as follows:
ARTICLE 1
DEFINITIONS
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Section 1.1 The following capitalized terms shall have the
meanings given below.
(a) " Agreement " means this Contribution and
Conveyance Agreement.
(b) " Common Unit " has the meaning assigned to
such term in the ETE Partnership Agreement.
(c) " Closing " has the meaning
specified in Section 3.1.
(d) " Closing Date " has the meaning specified in
Section 3.1.
(e) " ETE Partnership Agreement " means the Third
Amended and Restated Agreement of Limited Partnership of ETE dated
as of February 8, 2006, as amended by Amendment No. 1,
dated as of the Closing Date.
(f) " ETP " means Energy Transfer Partners, L.P.,
a Delaware limited partnership.
(g) " ETP GP Partnership Agreement " means the
Amended and Restated Agreement of Limited Partnership of ETP GP,
dated as of February 8, 2006.
(h) " ETP GP LLC Agreement " means the Amended and
Restated Limited Liability Company Agreement Energy Transfer
Partners, L.L.C., dated as of February 8, 2006.
(i) " Property " means any interest in any kind of
property or asset, whether real, personal or mixed, or tangible or
intangible.
(j) " Material Adverse Effect " means, with
respect to any party, any event or condition that has had or could
reasonably be expected to (i) have a material adverse effect
on the financial condition, results of operations or business of
such party, (ii) result in a breach or violation of any
representation, warranty, covenant or condition contained in this
Agreement as a result of which a party has, or with notice, the
lapse of time or both, is likely to have, the right to terminate
this Agreement or (ii) impair or affect adversely such
party’s ability to perform its obligations under this
Agreement or impair or delay completion of the transactions
contemplated hereby.
(k) " CCE Purchase Agreement " means the Purchase
and Sale Agreement, dated as of September 14, 2006, among ETP
and the Class B Members of CCE Holdings, LLC.
ARTICLE 2
CONTRIBUTIONS, ACKNOWLEDGMENTS AND
DISTRIBUTIONS
Section 2.1 Contribution of IDR Interest to
ETE . Subject to the terms and conditions hereof, ETI
hereby agrees to contribute, grant, bargain, convey, assign,
transfer, set over and deliver to ETE, its successors and assigns,
for their use forever, all right, title and interest in and to the
IDR Interest owned by ETI as a contribution to the capital of ETE
and ETE hereby agrees to accept such IDR Interest as a contribution
to the capital of ETE.
Section 2.2 Issuance of Class C Units and Assumption
of Loan Agreement and ETP Promissory Note . Subject to the
terms and conditions hereof, ETE hereby agrees to issue, grant,
bargain, convey, assign, transfer, set over and deliver to ETI the
Class C Units and to accept and assume the Loan Agreement and all
of the rights and obligations of ETI arising out of or related to
the Loan Agreement in exchange for the contribution of the IDR
Interest by ETI
and ETI hereby agrees to accept the Class C Units
in exchange for its capital contribution of the IDR Interest to
ETE.
Section 2.3 Certificate Legends . The
certificates evidencing the Class C Units delivered pursuant to
Section 2.2 shall bear a legend substantially in the form set
forth below and containing such other information as ETE may deem
necessary or appropriate:
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THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED. IT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN
EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION
OF COUNSEL SATISFACTORY TO THE PARTNERSHIP THAT SUCH REGISTRATION
IS NOT REQUIRED.
ARTICLE 3
CLOSING
Section 3.1 Time and Place . Subject to the
terms and conditions hereof, the closing of the transactions
contemplated hereby (the " Closing ") shall be held
at the offices of Vinson & Elkins L.L.P., 2500 First City
Tower, 1001 Fannin, Houston, Texas 77002 at 3:00 p.m., Houston
time, immediately following the satisfaction or waiver of the
conditions contained in Article 7 or at such other place or time as
the parties hereto may mutually agree. The date of the Closing is
referred to herein as the " Closing Date ."
Section 3.2 Deliveries at the Closing . At
the Closing, the following shall occur:
(a) ETI shall execute and deliver to ETE duly executed unit
certificates or unit certificates endorsed in blank whereby the IDR
Interest is transferred to ETE;
(b) ETE shall execute and deliver Amendment No. 1 and shall
deliver to ETI the Class C Units;
(c) ETI shall deliver to ETE an officer’s certificate,
dated the Closing Date, and executed by ETI, reasonably
satisfactory in form and substance to ETE, as to the matters set
forth in Sections 7.1(a) and (b);
(d) ETE shall deliver to ETI an officer’s certificate,
dated the Closing Date, and executed by ETE, reasonably
satisfactory in form and substance to ETI, as to the matters set
forth in Sections 7.2(a) and (b);
(e) ETI and ETE shall execute and deliver to the other
counterparts of the form of registration rights agreement attached
as Exhibit B ;
(f) ETI shall deliver an executed consent of the lenders under
the Loan Agreement, approving, ratifying and consenting to the
assignment and assumption set forth in Section 2.2;
(g) ETI shall deliver to ETE Investor
Representation Letters, duly executed by each of ETI’s
limited and general partners, in the form attached hereto as
Exhibit C ; and
(h) Each Party shall execute such additional documents as the
other Party shall reasonably request to effectuate the transactions
contemplated hereby.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF ETI
ETI hereby represents and warrants to ETE that the statements
contained in this Article 4 are correct and complete as of the
date hereof.
Section 4.1 Existence . ETI (i) is a
limited partnership duly organized, legally existing and in good
standing under the laws of the State of Delaware and (ii) has
all requisite power and authority, and has all governmental
licenses, authorizations, consents and approvals necessary, to own,
lease, use and operate its Properties and carry on its business as
its business is now being conducted, except where the failure to
obtain such licenses, authorizations, consents and approvals would
not be reasonably likely to have a Material Adverse Effect.
Section 4.2 Authority . ETI has all necessary
power and authority to execute, deliver and perform its obligations
under this Agreement; and the execution, delivery and performance
by ETI of this Agreement has been duly authorized by all necessary
action on its part; and this Agreement constitutes the legal, valid
and binding obligations of ETI, enforceable in accordance with its
terms.
Section 4.3 Approvals . Other than consents
that have been obtained, ETI is not required to obtain any
authorization, consent, approval, waiver, license, qualification or
written exemption from, nor make any filing, declaration,
qualification or registration with, any court or governmental
agency or body or any stock exchange authority or self regulatory
organization (each, a " Governmental Authority ") or
any other Person to consummate the contribution and delivery of the
IDR Interest being contributed by ETI to ETE or in connection with
the execution, delivery or performance by ETI of this
Agreement.
Section 4.4 No Breach . The execution and delivery
of this Agreement, the compliance by ETI with all the provisions
of, and the performance by ETI of its obligations under, this
Agreement, and the consummation of the transactions contemplated in
this Agreement will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, (i) the constitutive documents of ETI,
(ii) any instrument, contract or other agreement to which ETI
is a party or by which ETI is bound or to which any of its
Properties or assets may be bound or subject, in each case, the
breach or violation of which or default under which would be
reasonably expected to have a Material Adverse Effect on the
ability of ETI to comply with its obligations hereunder, or
(iii) any law or statute or any order, rule or regulation of
any Governmental Authority, in each case having jurisdiction over
ETI or any of its properties.
Section 4.5 Financial Statements .
ETI’s unaudited financial statements and any notes thereto or
schedules included therein (a) were prepared in accordance
with generally accepted accounting principles applied on a
consistent basis during the periods involved (except
as may be indicated in the notes thereto), and
(b) fairly present (subject to normal, recurring and year-end
audit adjustments) in all material respects the consolidated
financial position and status of the business of ETI as of the
dates thereof and the consolidated results of its operations and
cash flows for the periods then ended.
Section 4.6 No Material Adverse Changes .
Since the date of ETI’s most recent balance sheet
information, ETI has conducted its business in the ordinary course,
consistent with past practice, and there has been no change, event,
occurrence, fact, circumstance or condition that has had or would
be reasonably likely to have a Material Adverse Effect on the
assets, liabilities, financial condition, business, operations or
affairs of ETI.
Section 4.7 Good Title . ETI is the record
and beneficial owner of, and has good and marketable title to, the
IDR Interest, free and clear of all pledges, liens, claims,
encumbrances, options, voting trusts or agreements, proxies or
other claims or charges or adverse interests of any nature
whatsoever (other than resulting from this Agreement, the ETP GP
Partnership Agreement, the ETP GP LLC Agreement or the Loan
Agreement).
Section 4.8 Nature of the Investor . ETI
(a) is an "accredited investor" as defined in Rule 501(a) of
Regulation D promulgated under the Act, (b) is able to bear
the economic risk of losing its entire investment in the Class C
Units, and (c) has knowledge and experience in financial and
business matters such that it is capable of evaluating the risks
and merits of this investment.
Section 4.9 Investment . ETI is acquiring the
Class C Units for its own account, and not with a view to any
distribution, resale, subdivision, or fractionalization thereof in
violation of the Securities Act or any other applicable domestic
securities law, and ETI has no present plans to enter into any
contract, undertaking, agreement or arrangement for any such
distribution, resale, subdivision, or fractionalization of the
Class C Units in violation of the Securities Act or any other
applicable domestic securities law. ETI acknowledges and agrees
that, based in part upon its representations contained herein and
in reliance upon applicable exemptions, the purchase and sale of
the Class C Units has not been registered under the Act or the
securities laws of any other domestic or foreign jurisdiction and
that accordingly, the Class C Units may not be offered for sale,
sold, or otherwise transferred in whole or in part, except in
accordance with the terms of the Partnership Agreement and in
compliance with all applicable laws, including securities laws,
except that the Class C Units may be pledged in a bona fide
transaction.
Section 4.10 Receipt of Information . ETI has
carefully reviewed the documents filed by ETE with the Securities
and Exchange Commission (the " Commission ") under
the Securities Exchange Act of 1934, as amended (the "
Exchange Act " ) within the 18 months prior to the
date of this Agreement, including ETE’s Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q, current reports on Form
8-K and other filings (the " Partnership Information
") and acknowledges that ETE has provided to ETI or its
representatives all agreements, documents, records and books that
ETI or its representatives have requested relating to an investment
in ETE.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF E
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