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RESTRICTED BUSINESS CONTRIBUTION AGREEMENT

Contribution Agreement

RESTRICTED BUSINESS CONTRIBUTION AGREEMENT | Document Parties: NATURAL RESOURCE PARTNERS LP | CHRISTOPHER CLINE, | FORESIGHT RESERVES LP | ADENA MINERALS, LLC, | NATURAL RESOURCE PARTNERS L.P | GP NATURAL RESOURCE PARTNERS LLC  | NRP (OPERATING) LLC You are currently viewing:
This Contribution Agreement involves

NATURAL RESOURCE PARTNERS LP | CHRISTOPHER CLINE, | FORESIGHT RESERVES LP | ADENA MINERALS, LLC, | NATURAL RESOURCE PARTNERS L.P | GP NATURAL RESOURCE PARTNERS LLC | NRP (OPERATING) LLC

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Title: RESTRICTED BUSINESS CONTRIBUTION AGREEMENT
Governing Law: Delaware     Date: 1/4/2007
Industry: Coal     Law Firm: Foresight Reserves LP; Vinson & Elkins L.L.P.: Bailey & Glasser LLP     Sector: Energy

RESTRICTED BUSINESS CONTRIBUTION AGREEMENT, Parties: natural resource partners lp , christopher cline  , foresight reserves lp , adena minerals  llc  , natural resource partners l.p , gp natural resource partners llc  , nrp (operating) llc
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EXHIBIT 10.1

 

RESTRICTED BUSINESS CONTRIBUTION AGREEMENT

among

CHRISTOPHER CLINE,

FORESIGHT RESERVES LP,

ADENA MINERALS, LLC,

NATURAL RESOURCE PARTNERS L.P.,

NRP (GP) LP,

GP NATURAL RESOURCE PARTNERS LLC

and

NRP (OPERATING) LLC

 

 


 

RESTRICTED BUSINESS CONTRIBUTION AGREEMENT

     THIS RESTRICTED BUSINESS CONTRIBUTION AGREEMENT is entered into on, and effective as of, the Closing Date among Christopher Cline (“ Cline ”), an individual residing in Palm Beach County, Florida; Foresight Reserves LP, a Nevada limited partnership (“ Foresight ”); Adena Minerals, LLC, a Delaware limited liability company and wholly owned subsidiary of Foresight (“ Adena ” and, together with Cline and Foresight, collectively, the “ Adena Parties ”); Natural Resource Partners L.P., a Delaware limited partnership (the “ MLP ”); NRP (GP) LP, a Delaware limited partnership (including any permitted successors and assigns under the MLP Agreement (as defined herein), the “ General Partner ”); GP Natural Resource Partners LLC, a Delaware limited liability company (the “ Managing General Partner ”) and NRP (Operating) LLC, a Delaware limited liability company (the “ OLLC ”). The above-named entities are sometimes referred to in this Agreement each as a “ Party ” and collectively as the “ Parties .”

R E C I T A L S:

     The Adena Parties, the MLP, for itself and in its capacity as the sole member of the OLLC, the OLLC, the General Partner, for itself and in its capacity as the general partner of the MLP, and the Managing General Partner, for itself and in its capacity as the general partner of the General Partner, desire by their execution of this Agreement to evidence their understanding, as more fully set forth in Article II of this Agreement, with respect to (a) those business opportunities that the Adena Entities are required to offer to the Partnership Group, (b) the procedures whereby such business opportunities are to be offered to the Partnership Group and accepted or declined, and (c) the identification by the Parties of areas of mutual interest with respect to certain assets referred to herein and included in offers of certain business opportunities that the Adena Entities are required to offer to the Partnership Group.

     In consideration of the premises and the covenants, conditions, and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as follows:

ARTICLE I
Definitions

1.1 Definitions. As used in this Agreement, the following terms shall have the respective meanings set forth below:

“Acquired Properties” is defined in Section 2.4(a).

“Acquired Properties AMI” is defined in Section 2.4(a).

“Additional AMI Certificates” is defined in Section 2.4(b).

“Adena” is defined in the introduction to this Agreement.

 


 

      “Adena Entities” means the Adena Parties and their respective Affiliates (including, without limitation, all Persons that are Affiliates of any Adena Party as of the date of this Agreement and all Persons that become Affiliates of any Adena Party after the date of this Agreement) other than the Partnership Entities .

      “Adena Parties” is defined in the introduction to this Agreement.

      “Adjacent Reserves” means the coal reserves subject to the Adjacent Reserves Option, as defined in Section 3.1 of the Purchase Option Agreement.

     “ Affiliate ” means, when used with respect to a specified Person, any other Person directly or indirectly (through one or more intermediaries or otherwise) controlling, controlled by or under common control with the specified Person. For purposes of this definition, “ control ,” when used with respect to any specified Person, means the power to direct or cause the direction of the management and policies of the Person whether through the ownership of voting securities, by contract or otherwise; and the term “controlled” has the meanings correlative to the foregoing.

      “Agreement” means this Restricted Business Contribution Agreement, as it may be amended, modified, or supplemented from time to time.

     “ AMI Certificate ” means the certificate acknowledged, agreed to and delivered by the Parties concurrently with the execution and delivery of this Agreement, as contemplated by Section 2.4(a).

      “Applicable Period” means the period commencing on the Closing Date and terminating on the date on which the Adena Entities cease to be entitled to nominate for election any individuals to serve as members of the board of directors of the Managing General Partner pursuant to the terms and provisions of the Managing General Partner Operating Agreement and that certain Investor Rights Agreement dated as of the date hereof by and among Adena, the General Partner, the Managing General Partner and Robertson Coal Management LLC, a Delaware limited liability company.

      “Assignable Reserves” means any interest in any coal reserves and/or resources (as defined by the United States Geologic Survey) held or acquired by any Adena Entity, including any ownership or fee interest, leasehold or subleasehold interest, royalty interest or otherwise, other than any such interests to be acquired by the Partnership Group for consideration pursuant to the transactions contemplated by the Second Contribution Agreement.

      Cline is defined in the introduction to this Agreement.

      “Closing Date” means the date of the closing of the transactions contemplated by the Contribution Agreement.

      “Conflicts Committee” is defined in the MLP Agreement.

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      “Consideration” means the consideration to be delivered for a Restricted Business acquired by the Partnership Group pursuant to Section 2.3 in the form of cash, limited partner interests in the MLP, limited partner interests in the General Partner (including special allocations with respect to the Incentive Distribution Rights held by the General Partner), or any combination thereof.

      “Consideration Cap” means an aggregate interest in the General Partner entitling the Adena Entities to the right to receive all cash distributions and other income and deductions related to 40% of the General Partner’s 2% general partner interest in the MLP and to 61.538% of the General Partner’s Incentive Distribution Rights (or 40% of all of the Incentive Distribution Rights), as further set forth in the General Partner Partnership Agreement.

      “Contribution Agreement ” means that certain Contribution Agreement dated as of December 14, 2006 by and among Foresight, Adena, the MLP, the General Partner, the Managing General Partner and the OLLC.

      “Foresight” is defined in the introduction to this Agreement.

      “General Partner” means the General Partner and its successors as general partner of the MLP.

      “General Partner Partnership Agreement” means that certain Third Amended and Restated Limited Partnership Agreement of the General Partner dated as of the Closing Date, as such agreement may be amended, modified or supplemented from time to time after the Closing Date.

      “Hard Minerals” means naturally occurring deposits of minerals that are in solid form at room temperature that can be extracted, processed and sold for economic gain, which minerals include but are not limited to coal, aggregates, potash, copper, gold, limestone, iron ore, platinum, silver, uranium and trona.

      “Hard Minerals AMI” means, collectively, the Acquired Properties AMI and all Offer AMIs.

      “Hard Minerals Restricted Business” is defined in Section 2.1(a)(i).

      “Managing General Partner” means the Managing General Partner and its successors as general partner of the General Partner.

      “Managing General Partner Operating Agreement” means that certain Fourth Amended and Restated Limited Liability Company Agreement of the Managing General Partner dated as of the Closing Date, as such agreement may be amended, modified or supplemented from time to time after the Closing Date.

-3-


 

      “Mining Operations” means the mining, extraction, processing and sale of Hard Minerals, whether conducted through any business, assets or Person.

     “ MLP ” is defined in the introduction to this Agreement.

      “MLP Agreement” means that certain Second Amended and Restated Agreement of Limited Partnership of the MLP dated as of the Closing Date, as such agreement may be amended, modified or supplemented from time to time after the Closing Date.

      “Mutually Agreed Firm” is defined in Section 2.3(c)(ii).

      “Non-Producing Hard Minerals Reserves” means reserves of Hard Minerals that are not associated with Mining Operations.

      “Offer” is defined in Section 2.3(b).

      “Offer AMI ” is defined in Section 2.4(b).

     “ OLLC ” is defined in the introduction to this Agreement.

      “Operate” means the unrestricted right to own, operate, purchase, sell, swap, otherwise transfer, lease or invest in, in whole or in part, directly or indirectly, a particular asset or business.

      “Option Expiration Date” is defined in Section 2.2(e).

      “Option Offer” means a bona fide written offer from Cline to Trout giving Trout the option to purchase the Option Reserves identified in such offer pursuant to the terms and conditions of the Purchase Option Agreement or the Wildcat Agreement, as applicable.

      “Option Period” means the 14-day period following the receipt by Trout of an Option Offer.

      “Option Reserves” means the Adjacent Reserves and the Wildcat Adjacent Reserves, collectively.

      “Panther” means Panther, LLC, a West Virginia limited liability company.

      “Partnership Entities” means the Managing General Partner, the General Partner, the MLP, the OLLC and any Subsidiary of the MLP or the OLLC.

      “Partnership Group” means the MLP, the General Partner, the OLLC and any Subsidiary of the MLP or the OLLC.

      “Party” or “Parties” is defined in the introduction to this Agreement.

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

      “Purchase Option Agreement” means that certain Second Amended and Restated Purchase Option Agreement dated as of December 30, 2003 by and among Trout, Trout II, Panther and Cline, as amended by Amendment No. 1 dated as of March 21, 2005, as such agreement may be further amended, modified or supplemented from time to time after the Closing Date in accordance with Section 3.15.

      “Restricted Businesses” is defined in Section 2.1(a).

      “Second Contribution Agreement” is defined in the Contribution Agreement.

      “Selected Firm” is defined in Section 2.3(c)(ii).

      “Subsidiary” means, with respect to any Person, (i) a corporation of which more than 50% of the voting power of shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors or other governing body of such corporation is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person or a combination thereof, (ii) a partnership (whether general or limited) in which such Person or a Subsidiary of such Person is, at the date of determination, a general or limited partner of such partnership, but only if more than 50% of the partnership interests of such partnership (considering all of the partnership interests of the partnership as a single class) is owned, directly or indirectly, at the date of determination, by such Person, by one or more Subsidiaries of such Person, or a combination thereof, or (iii) any other Person (other than a corporation or a partnership) in which such Person, one or more Subsidiaries of such Person, or a combination thereof, directly or indirectly, at the date of determination, has (A) at least a majority ownership interest or (B) the power to elect or direct the election of a majority of the directors or other governing body of such Person.

      “Transportation Infrastructure Restricted Business” is defined in Section 2.1(a)(ii).

      “Transportation Infrastructure Restricted Business Certificate” means the certificate acknowledged, agreed to and delivered by the Parties concurrently with the execution and delivery of this Agreement, as contemplated by Section 2.1(a).

      “Trout” means Trout Coal Holdings, LLC, a Delaware limited liability company.

      “Trout II” means Trout Coal Holdings II, LLC, a Delaware limited liability company.

      “Trout Acceptance Notice” means a notice delivered by Trout or Trout II, as applicable, to Cline indicating that Trout or Trout II, as applicable, has elected to

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purchase the Option Reserves that are the subject of the Option Offer pursuant to the terms and conditions of the Purchase Option Agreement or the Wildcat Agreement, as applicable.

      “Trout Rejection Notice” means a notice delivered by Trout or Trout II, as applicable, to Cline indicating that Trout or Trout II, as applicable, has elected not to purchase the Option Reserves that are the subject of the Option Offer pursuant to the terms and conditions of the Purchase Option Agreement or the Wildcat Agreement, as applicable.

      “Valuation” means (i) the valuation submitted by the Mutually Agreed Firm or (ii) if there is no Mutually Agreed Firm, the arithmetic mean of the valuation submitted by the Adena Entity’s Selected Firm and the valuation submitted by General Partner’s Selected Firm.

      “Wildcat Adjacent Reserves” is defined in the Wildcat Agreement.

      “Wildcat Agreement” means that certain Wildcat Adjacent Reserves and Royalty Payment Agreement dated as of December 30, 2003 by and between Trout and Cline, as amended by Amendment No. 1 dated as of March 21, 2005, as such agreement may be further amended, modified or supplemented from time to time after the Closing Date in accordance with Section 3.15.

ARTICLE II
Restricted Businesses; Areas of Mutual Interest

2.1 Restricted Businesses.

(a) During the Applicable Period and subject to Section 2.2, the Adena Entities shall be required to offer to the Partnership Group the opportunity to acquire all Restricted Businesses owned, operated or invested in by any of the Adena Entities, directly or indirectly, in each case in accordance with the procedures set forth in Section 2.3. For purposes of this Agreement, a “ Restricted Business ” means the following activities whether conducted through any business, assets or Person, directly or indirectly: (i) owning, investing in and/or entering into leases as lessor of any Hard Minerals in the United States or any overriding royalty interest in any Hard Minerals in the United States (a “ Hard Minerals Restricted Business ”), and (ii) owning, investing in, operating and/or leasing the transportation infrastructure assets included in or associated with (or to be included in or associated with) the projects in Illinois as identified on the Transportation Infrastructure Restricted Business Certificate (a “ Transportation Infrastructure Restricted Business ”). Notwithstanding the foregoing, a Restricted Business does not include (1) any beneficial ownership interest in a publicly traded company so long as such interest is held solely for passive investment purposes and is not controlled by an Adena Entity, (2) any beneficial ownership interest in a publicly traded company primarily engaged in Mining Operations and controlled by an Adena Entity so long as any assets contributed or otherwise conveyed to such publicly traded company by any Adena Entity do not constitute Restricted Businesses or are Restricted Businesses described in Section 2.2(b),

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and (3) the assets of a publicly traded company primarily engaged in Mining Operations and controlled by an Adena Entity that were not contributed to such publicly traded company by an


 
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