RESTRICTED BUSINESS CONTRIBUTION
AGREEMENT
NATURAL RESOURCE PARTNERS
L.P.,
GP NATURAL RESOURCE PARTNERS
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 .”
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:
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.
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“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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