SECURITIES PURCHASE AGREEMENT

Exhibit 10.1

 

SECURITIES PURCHASE AGREEMENT

By and Among

A TLAS P IPELINE M ID -C ONTINENT LLC,

A TLAS P IPELINE P ARTNERS , L.P.,

S PECTRA E NERGY P ARTNERS OLP, LP,

AND

S PECTRA E NERGY P ARTNERS , LP

dated as of April 7, 2009

 

TABLE OF CONTENTS

 

 

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SECURITIES PURCHASE AGREEMENT

This S ECURITIES P URCHASE A GREEMENT (this “ Agreement ”) is entered into as of this 7 ^th day of April, 2009, by and among Atlas Pipeline Mid-Continent LLC, a Delaware limited liability company (“ Seller ”), and Spectra Energy Partners OLP, LP, a Delaware limited partnership (“ Buyer ”), and, solely for the purposes of Section 8.19 , Atlas Pipeline Partners, L.P., a Delaware limited partnership (“ Seller Parent ”), and, solely for the purposes of Section 8.19 , Spectra Energy Partners, LP, a Delaware limited partnership (“ Buyer Parent ”).

RECITALS:

WHEREAS , Seller owns, beneficially and of record, (i) all of the issued and outstanding membership interests of Atlas Arkansas Pipeline LLC, an Oklahoma limited liability company (“ AAP ”), and (ii) all of the issued and outstanding membership interests of Mid-Continent Arkansas Pipeline, LLC, an Arkansas limited liability company (“ MAP ,” and together with AAP, the “ NOARK Holding Companies ”);

WHEREAS , AAP owns, beneficially and of record, a 74% general partnership interest and a 1% limited partnership interest in NOARK Pipeline System, Limited Partnership, an Arkansas limited partnership (“ NOARK ”), and MAP owns, beneficially and of record, a 25% general partnership interest in NOARK;

WHEREAS , NOARK owns, beneficially and of record, (i) all of the issued and outstanding membership interests in Ozark Gas Transmission, L.L.C., an Oklahoma limited liability company (“ OGT ”), and (ii) all of the issued and outstanding membership interests of Ozark Gas Gathering, L.L.C., an Oklahoma limited liability company (“ OGG ” and, together with OGT and NOARK, the “ Ozark Gas Companies ”);

WHEREAS , NOARK owns, beneficially and of record, all of the issued and outstanding membership interests in NOARK Energy Services, LLC, an Oklahoma limited liability company (“ NES ”);

WHEREAS , the Ozark Gas Companies own and operate (i) a FERC-regulated interstate natural gas transmission pipeline system, which consists of a 565-mile interstate natural gas pipeline extending from southeast Oklahoma through Arkansas to southeast Missouri, for the provision of interstate natural gas transportation services, and (ii) a 365-mile natural gas gathering system located in eastern Oklahoma and western Arkansas that is not subject to FERC regulation, for the provision of natural gas gathering services, as well as associated equipment and systems (collectively, the “ Business ”); and

WHEREAS , Buyer desires to acquire the Business by purchasing from Seller all of the issued and outstanding membership interests of the NOARK Holding Companies (the “ Equity Interests ”), and Seller desires to sell and deliver to Buyer all of the Equity Interests, on the terms and subject to the conditions set forth in this Agreement.

AGREEMENT:

NOW , THEREFORE , in consideration of the foregoing and of the mutual representations, warranties and covenants contained in this Agreement as well as such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties to this Agreement hereby agree as follows:

ARTICLE I

DEFINITIONS; CERTAIN INTERPRETIVE MATTERS

1.1 Definitions . In addition to the terms defined elsewhere herein, the following terms have the following respective meanings when used herein with initial capital letters:

“ AAP ” has the meaning set for in the Recitals to this Agreement.

“ Accountant ” has the meaning set forth in Section 2.4(e)(i) .

“ Acquisition Proposal ” shall mean any proposal or offer by a third party for (i) any merger, consolidation, share exchange, business combination or other similar transaction or series of transactions (whether related or unrelated) in which any issued and outstanding membership interest of any of the members of the NOARK Group, either directly or indirectly, or all or a material portion of the assets of any of the members of the NOARK Group would be acquired by any third party, (ii) any sale, lease, exchange, mortgage, pledge, transfer or other disposition of the assets of any of the members of the NOARK Group, in a single transaction or series of transactions (whether related or unrelated) other than in the ordinary course of business, or (iii) any public announcement of a proposal, plan or intention to do any of the foregoing or any agreement to engage in any of the foregoing; provided , however , that none of the following shall be deemed to be an “Acquisition Proposal”: (x) any merger, consolidation, share exchange, business combination or other similar transaction or series of transactions (whether related or unrelated) that constitutes a change of control of Seller Parent or Atlas America, Inc. or any sale by Seller Parent or Atlas America, Inc. of all or substantially all of its assets; or (y) any sale, exchange, transfer or other disposition of assets of Seller Parent or Atlas America, Inc. in which the Equity Interests do not represent more than 25% of the total net book value of the assets being transferred in a single transaction, provided that any such transaction shall not be in derogation of the Buyer’s rights under this Agreement, nor prevent or delay in any material respect the consummation of the transactions contemplated by this Agreement in the manner contemplated hereby.

“ Actively Employed ” has the meaning set forth in Section 5.17(a) .

“ Affiliate ” means, with respect to a specified Person, a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with the Person specified. For the purposes of this definition, “control” means with respect to any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” have correlative meanings.

 

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“ Agreement ” has the meaning set forth in the Preamble.

“ Area ” means all counties in which the Pipeline System is located as of the Closing Date.

“ Assets ” means and shall include all assets, rights, interests, contract rights, accounts, claims, credits, franchises and properties of the NOARK Group, whether real, personal, tangible or intangible.

“ Assignment ” has the meaning set forth in Section 2.2(b)(ii) .

“ Audited Financials ” has the meaning set forth in Section 2.7(c) .

“ Beneficiary ” has the meaning set forth in Section 8.19(a) .

“ Business ” has the meaning set forth in the Recitals to this Agreement.

“ Business Day ” means any day other than a Saturday or Sunday or a day on which the Federal Reserve Bank of New York is closed.

“ Business Permits ” has the meaning set forth in Section 3.6(a) .

“ Buyer ” has the meaning set forth in the Preamble.

“ Buyer Employer ” has the meaning set forth in Section 5.17(a) .

“ Buyer Indemnified Parties ” has the meaning set forth in Section 7.3(a) .

“ Buyer Marks ” has the meaning set forth in Section 5.12(b) .

“ Buyer Material Adverse Effect ” has the meaning set forth in Section 4.1 .

“ Buyer Obligations ” has the meaning set forth in Section 8.19(a) .

“ Buyer Parent ” has the meaning set forth in the Preamble.

“ Buyer Protected Information ” has the meaning set forth in Section 5.14 .

“ Buyer Representatives ” has the meaning set forth in Section 5.8(a) .

“ Cap Amount ” has the meaning set forth in Section 7.3(a) .

“ Capital Lease Obligations ” means with respect to any Person, for any applicable period, the obligations of such Person that are permitted or required to be classified and accounted for as capital obligations under GAAP, and the amount of such obligations at any date will be the capitalized amount of such obligations at such date determined in accordance with GAAP.

“ CERCLA ” has the meaning set forth in the definition of Environmental Laws.

 

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“ Change of Control Agreements ” means those certain Change of Control Agreements listed on Schedule 1.1(A) .

“ Claim Notice ” has the meaning set forth in Section 7.5(a) .

“ Closing ” has the meaning set forth in Section 2.2(a) .

“ Closing Date ” has the meaning set forth in Section 2.2(a) .

“ Closing Date Estimate ” has the meaning set forth in Section 2.4(b) .

“ Closing Statement ” has the meaning set forth in Section 2.4(c) .

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

“ Competing Business ” means any business organization of whatever form engaged in the gas gathering or gas transportation business in the Area.

“ Confidentiality Agreement ” means that certain confidentiality agreement, dated as of December 11, 2008, between Seller Parent, Atlas America, Inc., Atlas Pipeline Holdings, L.P., Atlas Energy Resources, LLC and Spectra Energy Corp.

“ Continuing Employee ” has the meaning set forth in Section 5.17(a) .

“ Current Assets ” means and shall include all cash, cash equivalents, short-term investments, any accounts receivable and accrued revenue associated with accounts receivable, and other current assets of the NOARK Group, as determined in accordance with GAAP; provided that , as used in this Agreement, Current Assets shall not include (i) deferred Tax assets or any Tax receivables, (ii) Intercompany Receivables, and (iii) any inventory.

“ Current Liabilities ” means and shall include all accounts payable and accrued expenses associated with accounts payable, and other current liabilities of the NOARK Group, as determined in accordance with GAAP, as well as any and all credits, refunds or rebates due to shippers; provided that , as used in this Agreement, Current Liabilities shall not include (i) deferred Tax liabilities, and (ii) Intercompany Payables.

“ Damages ” has the meaning set forth in Section 7.3(a) .

“ Data Room ” has the meaning set forth in Section 1.2 .

“ Deductible Amount ” has the meaning set forth in Section 7.3(a) .

“ Dispute Notice ” has the meaning set forth in Section 2.4(d) .

“ Easements ” has the meaning set forth in Section 3.10(b) .

“ EBITDA ” means net income, (i) plus interest expense, income taxes, depreciation and amortization, and (ii) excluding any extraordinary items, in each case determined in accordance with GAAP.

 

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“ Effective Date ” means April 7, 2009.

“ Employee Plans ” has the meaning set forth in Section 3.21(a) .

“ Environmental Laws ” means any and all applicable Laws of any Governmental Authority pertaining to pollution or protection of the environment currently in effect in any and all jurisdictions in which any of the Ozark Gas Companies’ facilities are located or in which any of their operations are conducted, including without limitation, the Clean Air Act, as amended, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (“ CERCLA ”), the Federal Water Pollution Control Act, as amended, the Resource Conservation and Recovery Act of 1976, as amended (“ RCRA ”), the Safe Drinking Water Act, as amended, the Toxic Substances Control Act, as amended, the Hazardous Materials Transportation Act, as amended, and any Laws pertaining to the handling, transportation or storage of wastes or other substances (including hazardous substances) governed by Environmental Laws or the use, maintenance, and closure of surface impoundments, as that term is defined under RCRA. For purposes of this Agreement, the terms “ hazardous substance ” and “ release ” (or “ threatened release ”) have the respective meanings specified in CERCLA, and the terms “ solid waste ” and “ disposal ” (or “ disposed ”) have the respective meanings specified in RCRA; provided, however, that to the extent the Laws of the jurisdiction in which the property is located or the operations are conducted establish a meaning for “hazardous substance,” “release,” “solid waste” or “disposal” that is broader than that specified in either CERCLA or RCRA, such broader meaning shall apply.

“ Equity Interests ” has the meaning set forth in the Recitals to this Agreement.

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

“ ERISA Affiliate ” shall mean, with respect to any Person, any other Person that is a member of a group described in Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes the first Person, or that is a member of the same “controlled group” as the first Person pursuant to Section 4001(a)(14) of ERISA.

“ Escrow Account ” shall mean the escrow account maintained by the Escrow Agent pursuant to the terms of the Escrow Agreement.

“ Escrow Agent ” shall mean JPMorgan Chase Bank, National Association.

“ Escrow Agreement ” shall mean an escrow agreement in the form attached hereto as Exhibit A .

“ Escrow Amount ” shall have the meaning set forth in Section 2.2(c) .

“ Excluded Assets ” shall mean those certain assets and interests of any Affiliate of Seller (excluding the NOARK Group) as described in reasonable detail on Schedule 1.1(B) .

“ FCC ” means the Federal Communications Commission.

 

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“ FERC ” means the Federal Energy Regulatory Commission.

“ FERC Filings ” has the meaning set forth in Section 2.7(b) .

“ Final Closing Statement ” has the meaning set forth in Section 2.4(e)(iv) .

“ Final Purchase Price ” has the meaning set forth in Section 2.1 .

“ Final Settlement Date ” has the meaning set forth in Section 2.4(d) .

“ GAAP ” means generally accepted accounting principles in effect from time to time in the United States of America, applied on a consistent basis.

“ Governmental Authorities ” means any federal, state, municipal, local, foreign or similar governmental authority, regulatory or administrative agency, court or arbitral body.

“ Guarantor ” has the meaning set forth in Section 8.19(a) .

“ Hire Date ” has the meaning set forth in Section 5.17(a) .

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“ Indebtedness ” means with respect to any Person, at any date, without duplication, (i) all obligations of such Person for borrowed money (or issued in substitution for or exchange of indebtedness for borrowed money), including without limitation all principal, interest, premiums, fees, expenses, overdrafts, and penalties with respect thereto, whether short-term or long-term, and whether secured or unsecured, (ii) all obligations of such Person evidenced by mortgages, bonds, debentures, notes or similar instruments, (iii) all obligations of such Person upon which interest charges are customarily paid (other than current trade payables incurred in the ordinary course of business), (iv) all obligations of such Person under conditional sale or other title retention agreements relating to property or assets purchased by such Person, (v) all obligations of such Person issued or assumed as the deferred purchase price of property or services (other than current trade payables incurred in the ordinary course of business), (vi) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property or assets owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (vii) all guarantees, whether direct or indirect, by such Person of Indebtedness of others or Indebtedness of any other Person secured by any property or assets of such Person, (viii) all Capital Lease Obligations of such Person, (ix) all net payments that such Person would have to make in the event of an early termination, on the date Indebtedness of such Person is being determined, in respect of outstanding interest rate protection agreements, foreign currency exchange arrangements or other interest or exchange rate commodity or other hedging arrangements, (x) renewals, extensions, refundings, deferrals, restructurings, amendments and modifications of any such Indebtedness, obligations or guarantees, (xi) any off-balance sheet financing (but excluding all operating leases that are not Capital Lease Obligations), (xii) any other obligation that in accordance with GAAP is required to be reflected as debt on the balance sheet of a Person, and (xiii) any accrued and unpaid interest on, and any prepayment premiums, penalties or similar contractual charges in respect of, any of the foregoing.

 

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“ Indemnified Party ” has the meaning set forth in Section 7.5(a) .

“ Indemnifying Party ” has the meaning set forth in Section 7.5(a) .

“ Initial Adjustment ” has the meaning set forth in Section 2.4(b) .

“ Intellectual Property ” means intellectual property rights, statutory or common law, worldwide, including without limitation: (a) trademarks, service marks, trade dress, slogans, logos and all goodwill associated therewith, and any applications or registrations for any of the foregoing; (b) copyrights and any applications or registrations for any of the foregoing; and (c) 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.

“ Intercompany Payables ” shall mean all payables owed by any member of the NOARK Group to Seller or any of Seller’s Affiliates (other than members of the NOARK Group).

“ Intercompany Receivables ” shall mean all receivables owed to any member of the NOARK Group by Seller or any of Seller’s Affiliates (other than members of the NOARK Group).

“ Interim Period ” means the period of time from the Effective Date until (and including) the Closing Date.

“ Interim Period Economics ” means EBITDA generated from the Business during the Interim Period, less all capital expenditures made by the NOARK Group in connection with the Business during the Interim Period that are permitted pursuant to the terms of this Agreement; provided , however , that (i) if in any given month the total of such capital expenditures exceeds $200,000 in the aggregate, then no additional capital expenditures in excess of $200,000 will be included for such month in the determination of the Interim Period Economics unless Buyer consents to any such capital expenditure in accordance with Section 5.1 , and (ii) the amount of such Interim Period Economics shall not be less than zero.

“ Knowledge ” means (a) with respect to Seller or Seller Parent, the actual knowledge of any of the persons listed on Schedule 1.1(C) , and (b) with respect to Buyer, the actual knowledge of any of the persons listed on Schedule 1.1(D) .

“ Law ” means any federal, state, county, city, municipal, foreign or other government statute, law, rule, regulation, ordinance, Order, code or requirement (including pursuant to any settlement agreement or consent decree) and any permit or license granted under any of the foregoing, or any requirement under common law.

“ Liabilities ” or “ Liability ” has the meaning set forth in Section 3.8(a) .

 

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“ Lien ” means with respect to any property or asset, any mortgage, deed of trust, lien, pledge, hypothecation, assignment, charge, option, preemptive purchase right, easement, encumbrance or security interest in respect of such property or asset.

“ MAP ” has the meaning set forth in the Recitals to this Agreement.

“ Material Adverse Effect ” means, with respect to the NOARK Group, any state of facts, circumstance, change or effect that is materially adverse to the Business, financial condition or results of operations of the NOARK Group, taken as a whole, or on the ability of any of Seller or Seller Parent to complete the transactions contemplated herein; provided, however , that none of the following (or the effects thereof) will be deemed to constitute, and none of the following will be taken into account in determining whether there has been or if there is reasonably likely to be, a Material Adverse Effect: (a) any adverse change, event, development, or effect arising from or relating to (i) general business or economic conditions in the industries or markets in which the Ozark Gas Companies operate (including changes in commodity prices), except to the extent that such changes affect the Ozark Gas Companies in a materially disproportionate and adverse manner when compared to companies of similar size operating in the same industry or market as the Ozark Gas Companies, (ii) national or international political, social or economic conditions, including any engagement in hostilities, whether or not pursuant to the declaration of a national emergency or war, the occurrence of any military or terrorist attack or a general economic recession, (iii) financial, debt, credit, or securities markets (including any disruption thereof) in the United States or elsewhere, (iv) changes in GAAP or any other accounting principles applicable to the Ozark Gas Companies, or the interpretation thereof, (v) changes in Laws, or the interpretation thereof, (vi) the performance, announcement, or consummation of this Agreement and the transactions contemplated hereby, unless the execution, delivery or performance of this Agreement would otherwise cause Seller or any of the NOARK Group to breach any Material Contract, Law or representation under this Agreement, (vii) the taking of any action (or omitting to take any action) expressly contemplated by the Transaction Documents or the taking of any action (or omitting to take any action) that Buyer has requested or to which Buyer has expressly consented, unless the execution, delivery or performance of the Transaction Documents would otherwise cause any of Seller or the NOARK Group to breach any Material Contract, Law or representation under this Agreement, or (viii) those matters set forth on Schedule 1.1(E) ; and (b) any adverse change in or effect on the Business that is cured by Seller or the NOARK Group, as applicable, prior to the Closing.

“ Material Contracts ” means any and all contracts, obligations, undertakings, agreements, notes, bonds, debentures, guaranties, leases, licenses, or other agreements or commitments (whether written or oral), including without limitations any amendments or modifications to the foregoing, to which any of the Ozark Gas Companies is a party or is bound and that are material to the Business or the NOARK Group, including, without limitation (a) any partnership, joint venture or other similar contract involving a sharing of profits, losses, costs or liabilities, other than the formation documents of the Ozark Gas Companies, or any contract relating to the acquisition or disposition of any material business or material assets (whether by merger, sale of shares, sale of interests, sale of assets or otherwise) or any natural gas pipeline interconnection agreement, (b) any contract that limits the freedom of either of the Ozark Gas Companies to compete in any line of business, geographic area or with any Person, (c) any warranty, guaranty, indemnity or other similar undertaking with respect to a contractual performance extended by or

 

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on behalf of the Ozark Gas Companies or the Business other than in the ordinary course of business and which would reasonably be expected to result in a liability to the Ozark Gas Companies of more than $200,000, (d) any material swap, option, hedge, futures or similar instrument or contract involving natural gas or other commodity trading, (e) each natural gas transportation and gathering services contract and each natural gas purchase and sale contract that is currently in effect and individually provides for annual payments or revenues in excess of $200,000, (f) any contract, the termination of which or the failure of which to be renewed, would reasonably be expected, individually or in the aggregate, to be material to the Business, (g) any contract that would prevent the consummation of the transactions contemplated by this Agreement, compliance by Seller with the terms, conditions and provisions hereof or the continued operation of the Business after the Closing Date on substantially the same basis as historically operated, (h) except for contracts of the nature described in clauses (a) through (g) above, any contract involving aggregate payments by or to any of the Ozark Gas Companies in excess of $200,000 in any calendar year ending after the date of this Agreement that cannot be terminated by such Ozark Gas Company that is party thereto upon 60 days or less notice without payment penalty in excess of $200,000, or (i) excluding any Seller’s Security, any contract that would require a payment to be made by the Ozark Gas Companies, either before or after the Closing, as a result of the execution of this Agreement or the consummation of the transactions contemplated hereby, but only if all such payments in the aggregate equal or exceed $200,000; provided , however , that the term “Material Contracts” shall not include any Easements.

“ Materiality Qualifier ” means a qualification to a representation or warranty by use of the word “material,” “materially” or “materiality” or by a reference regarding the occurrence or non-occurrence or possible occurrence or non-occurrence of a Material Adverse Effect or Buyer Material Adverse Effect, as applicable.

“ NES ” has the meaning set forth in the Recitals to this Agreement.

“ NOARK ” has the meaning set forth in the Recitals to this Agreement.

“ NOARK Group ” means the Ozark Gas Companies and the NOARK Holding Companies collectively.

“ NOARK Holding Companies ” has the meaning set forth in the Recitals to this Agreement.

“ NOARK Partnership Interests ” has the meaning set forth in Section 3.2(b) .

“ NOARK Subsidiary Interests ” has the meaning set forth in Section 3.2(c) .

“ Obligations ” has the meaning set forth in Section 8.19(a) .

“ Obligor ” has the meaning set forth in Section 8.19(a) .

“ Offered Employees ” has the meaning set forth in Section 5.17(a) .

“ OGG ” has the meaning set forth in the Recitals to this Agreement.

 

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“ OGT ” has the meaning set forth in the Recitals to this Agreement.

“ Order ” means any judgment, injunction order, ruling, award or decree that is issued by a Governmental Authority.

“ Ozark Documents ” has the meaning set forth in Section 5.13(a) .

“ Ozark Gas Companies ” has the meaning set forth in the Recitals to this Agreement.

“ Ozark Monthly Financial Statements ” has the meaning set forth in Section 3.7(a) .

“ Ozark Unaudited Financial Statements ” has the meaning set forth in Section 3.7(a) .

“ Parties ” means Seller, Seller Parent, Buyer, and Buyer Parent, and “ Party ” means any of them individually.

“ Permitted Lien ” means (i) Liens for taxes, assessments or other similar governmental charges that are not yet due and payable as of the Closing Date or that are being contested in good faith by appropriate proceedings and that are fully and properly reserved for in OGT’s or OGG’s balance sheet as of the Statement Date; (ii) any mechanics’, workmen’s, repairmen’s and other similar Liens arising or incurred in the ordinary course of business in respect of obligations that are not due and payable as of the Closing Date or that are fully and properly reserved in OGT’s or OGG’s balance sheet as of the Statement Date, or if not so reserved, are being contested in good faith; (iii) any Lien listed in the Schedules or in the notes to the Ozark Unaudited Financial Statements that is not related to Indebtedness; (iv) any Lien arising under any original purchase price conditional sales contract or equipment lease that is not related to Indebtedness, provided that such Liens do not exceed $200,000 in the aggregate; (v) the express terms and conditions of any Easement; (vi) any restrictive covenants, easements and defects, imperfections or irregularities of title not of record, if any, as would not reasonably be expected to materially and adversely affect the use or operation of assets affected thereby; (vii) current zoning and subdivision Laws applicable to the Business and the real property related thereto; (viii) the express terms and conditions of any Material Contract; (ix) any pledge or deposit to secure any obligation under any workers or unemployment compensation Law or similar legislation or to secure any public or statutory obligation; and (x) any Lien that will be released on or prior to the Closing.

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

“ Pipeline System ” has the meaning set forth in Section 3.10(b) .

“ Post-Closing Tax Period ” means the portion of any Straddle Tax Period that is not included in a Pre-Closing Tax Period and any Tax period ending after the Closing Date that is not a Straddle Tax Period.

“ Pre-Closing Tax Period ” means any Prior Tax Period and the portion of any Straddle Tax Period that ends on the Closing Date.

 

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“ Prior Tax Period ” means any Tax period that ends on or before the Closing Date.

“ Purchase Price ” has the meaning set forth in Section 2.1 .

“ RAP ” means the regulatory accounting principles set forth in the Uniform System of Accounts prescribed by the FERC.

“ RCRA ” has the meaning set forth in the definition of Environmental Laws.

“ Required Working Capital Balance ” means $2,700,000.

“ Restricted Period ” shall mean the period commencing at the Closing and expiring on the first anniversary of the Closing Date.

“ Retention Period ” has the meaning set forth in Section 5.13(a) .

“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“ Seller ” has the meaning set forth in the Preamble.

“ Seller Fundamental Representations ” has the meaning set forth in Section 7.1 .

“ Seller Indemnified Parties ” has the meaning set forth in Section 7.4 .

“ Seller Marks ” has the meaning set forth in Section 5.12(a) .

“ Seller Obligations ” has the meaning set forth in Section 8.19(a) .

“ Seller Parent ” has the meaning set forth in the Preamble.

“ Seller Party ” has the meaning set forth in Section 5.15(a) .

“ Seller Plans ” shall mean all Employee Plans that are sponsored, maintained or contributed to by Seller or an Affiliate of Seller on behalf of the Subject Employees.

“ Seller Representatives ” has the meaning set forth in Section 5.8(a) .

“ Seller’s Security ” has the meaning set forth in Section 3.16 .

“ Senior Secured Credit Facility ” means the Revolving Credit and Term Loan Agreement and the Loan Documents (as defined therein), as amended, by and among Atlas Pipeline Partners, L.P. and Wachovia Bank, N.A. as Administrative Agent to the lending parties thereto, among others, dated as of July 27, 2007.

“ Statement Date ” means December 31, 2008.

“ Straddle Tax Period ” means any Tax period that includes but does not end on the Closing Date.

 

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“ Subject Employees ” has the meaning set forth in Section 3.21(f) .

“ Subsidiary ” means, with respect to a specified Person, (a) in the case of a corporation or limited liability company, 50% or more of the securities, the holders of which are regularly entitled to vote for the election of directors or managers, is owned directly or indirectly by such Person, or (b) in the case of a trust, partnership or other Person, a trust, partnership or Person of which such specified Person owns directly or indirectly 50% or more of the beneficial interest or equity.

“ Tax Return ” means any report, statement, form, return, election, schedule or other document or information required to be supplied to a Governmental Authority in connection with Taxes, including any amendment or supplement thereto.

“ Taxes ” means (a) any federal, state, local or foreign income or gross receipts tax, alternative or add-on minimum tax, sales and use tax, customs duty, escheat obligations and any other tax, levy or other assessment including without limitation property, transfer, occupation, service, license, payroll, franchise, excise, withholding, ad valorem, severance, stamp, premium, windfall profit, employment, rent or other tax, or like assessment, together with any interest, fine or penalty thereon, addition to tax, additional amount, deficiency or assessment; (b) any liability for the payment of any item described in clause (a) as a result of being a member of an affiliated, consolidated, combined or unitary group for any period, including pursuant to Treasury Regulations Section 1.1502-6 or any analogous or similar state, local or foreign Law; (c) any liability for the payment of any item described in clause (a) or (b) as a result of any obligation to indemnify any other Person under any agreement or arrangement with any other Person with respect to such item; or (d) any successor liability for the payment of any item described in clause (a), (b) or (c) of any other Person, including by reason of being a party to any merger, consolidation, conversion or otherwise.

“ Third Party ” has the meaning set forth in Section 5.15(a) .

“ Third Party Claim ” has the meaning set forth in Section 7.5(b) .

“ Third Party Claim Notice ” has the meaning set forth in Section 7.5(b) .

“ Transaction Documents ” means this Agreement, the Assignment, the Transition Services Agreement and all other documents delivered pursuant to any of these agreements, collectively.

“ Transfer Taxes ” has the meaning set forth in Section 5.5 .

“ Transition Services Agreement ” has the meaning set forth in Section 2.2(b)(iii) .

“ WARN ” shall mean the Worker Adjustment and Retraining Notification Act of 1989, as amended.

“ Working Capital ” means Current Assets minus Current Liabilities.

“ Working Capital Adjustment ” has the meaning set forth in Section 2.4(a) .

 

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“ Working Capital Balance Sheet ” has the meaning set forth in Section 2.4(c) .

1.2 Certain Interpretive Matters . Unless the context requires otherwise, (a) all references to Sections, Articles, Exhibits or Schedules are to be Sections, Articles, Exhibits or Schedules of or to this Agreement, (b) each term defined in this Agreement has the meaning assigned to it, (c) each accounting term not otherwise defined in this Agreement has the meaning commonly applied to it in accordance with GAAP, (d) words in the singular include the plural and vice versa , (e) the pronoun “his” refers to the masculine, feminine and neuter, the words “ herein ,” “ hereby ,” “ hereof ,” “ hereunder ” and other words of similar import refer to this Agreement as a whole and not to any particular Section, Article or other subdivision, (f) the term “including” means “including without limitation,” (g) the term “ made available to Buyer ” and words of similar import means that the relevant documents, instruments or materials were either provided directly to Buyer through its representatives or posted and made available to Buyer for review in the Bowne Virtual Data Room located at https://bdr104409.bmcgroup.com/Login.aspx?ReturnUrl=%2fdefault.aspx (the “ Data Room ”) no later than April 5, 2009, and (h) with respect to the Business, the term “ ordinary course of business ” will be deemed to refer to the conduct of the Business in a manner consistent with the ordinary course of business prior to Closing and consistent with past custom and practice. All references to $ or dollar amounts will be to lawful currency of the United States. To the extent the term “day” or “days” is used, it will mean calendar days. No provision of this Agreement will be interpreted in favor of, or against, any of the Parties hereto by reason of the extent to which any such Party or its counsel participated in the drafting thereof or by reason of the extent to which any such provision is inconsistent with any prior draft hereof or thereof.

1.3 Disclosure Schedules . Certain information contained in the Schedules is solely for informational purposes, may not be required to be disclosed pursuant hereto and will not imply that such information or any other information is required to be disclosed. Inclusion of such information will not establish any level of materiality or similar threshold or be an admission that such information is material to the business, assets, liabilities, financial position, operations or results of operations of any Person or is otherwise material regarding such Person. Each matter disclosed in any Schedule in a manner that makes its relevance to one or more other Schedules reasonably apparent on the face of such disclosure will be deemed to have been appropriately included in each such other Schedule (notwithstanding the presence or absence of any cross reference in any Schedule or the presence or absence of a reference to a Schedule in any representation or warranty).

ARTICLE II

PURCHASE AND SALE OF EQUITY INTERESTS; CLOSING

2.1 Purchase and Sale of Equity Interests . Seller and Buyer hereby agree that upon the terms and subject to the satisfaction or waiver of the conditions set forth herein, at the Closing, Seller shall sell, transfer, assign and deliver to Buyer, and Buyer shall purchase from Seller, the Equity Interests, free and clear of all Liens other than transfer restrictions imposed on the Equity Interests pursuant to applicable securities Laws, for a purchase price equal to $300,000,000 (the “ Purchase Price ”), as such amount may be adjusted in accordance with Section 2.4 (the “ Final Purchase Price ”) as such amount may be further adjusted in accordance with Section 2.7 . BUYER AND SELLER ACKNOWLEDGE AND AGREE THAT THE

 

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TERMS OF THIS AGREEMENT, INCLUDING THE LIMITATIONS ON, AND DISCLAIMERS OF WARRANTIES AND REPRESENTATIONS OF SELLER CONTAINED IN THIS AGREEMENT ARE A BARGAINED FOR AND MATERIAL PART OF THE CONSIDERATION FOR THE EQUITY INTERESTS.

2.2 Closing .

(a) General. The consummation of the transactions contemplated by this Agreement (the “ Closing ”) shall take place at the offices of Jones Day, 717 Texas, Suite 3300, Houston, Texas 77002-2712, on the third Business Day following the satisfaction or waiver of the conditions to the obligations of the Parties set forth in Article VI , or such other mutually agreeable date and time (the date on which Closing occurs, the “ Closing Date ”).

(b) Seller’s Closing Deliveries . Subject to the terms and conditions of this Agreement, at the Closing, Seller will deliver, or cause to be delivered, the following to Buyer:

(i) a certificate duly executed by a duly authorized officer of Seller, dated as of the Closing Date, certifying as to the matters set forth in Section 6.1(a)(iii) ;

(ii) a duly executed assignment of the Equity Interests, in substantially the form attached to this Agreement as Exhibit B (the “ Assignment ”);

(iii) a duly executed counterpart of the Transition Services Agreement, in substantially the form attached to this Agreement as Exhibit C (the “ Transition Services Agreement ”);

(iv) a duly executed certificate, in the form prescribed by Treasury Regulations under Section 1445 of the Code, stating that Seller (or its owner, if Seller is disregarded as an entity separate from its owner for federal tax purposes) is not a “foreign person” within the meaning of Section 1445 of the Code;

(v) a duly executed counterpart of a termination agreement with regard to the Confidentiality Agreement by Seller and its Affiliates that are a party thereto;

(vi) a duly executed receipt of Seller evidencing receipt of the Purchase Price, less the Escrow Amount and as adjusted pursuant to Section 2.4(b) and Section 2.7(c) , if applicable;

(vii) evidence that all Liens under the Senior Secured Credit Facility relating to any and all assets pertaining to the Business have been released and terminated in form and content reasonably satisfactory to Buyer;

 

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(viii) two copies of a CD-ROM containing all documents posted in the Data Room at any time after April 5, 2009 and up to, and including, the Closing Date, and a true, complete and correct index thereof;

(ix) a duly executed counterpart of the Escrow Agreement; and

(x) all other documents, certificates, instruments and writings required to be delivered at or prior to the Closing pursuant to this Agreement.

(c) Buyer’s Closing Deliveries . Subject to the terms and conditions of this Agreement, at the Closing, Buyer will deliver the following to Seller:

(i) a certificate duly executed by a duly authorized officer of Buyer, dated as of the Closing Date, certifying as to the matters set forth in Section 6.2(a)(iii) ;

(ii) the Purchase Price, less the Escrow Amount and as adjusted pursuant to Section 2.4(b) and Section 2.7(c) , if applicable;

(iii) evidence of the deposit of $5,000,000 (the “ Escrow Amount ”) with the Escrow Agent;

(iv) a duly executed counterpart of the Transition Services Agreement;

(v) a duly executed counterpart of a termination agreement with regard to the Confidentiality Agreement by Buyer and its Affiliates that are a party thereto;

(vi) a duly executed counterpart of the Escrow Agreement; and

(vii) all other documents, certificates, instruments and writings required to be delivered at or prior to the Closing pursuant to this Agreement.

2.3 Pre-Closing Distributions . At any time and from time to time prior to the Closing, including on the Closing Date, Seller may cause any member of the NOARK Group to distribute all or any portion of the cash and cash equivalents held by any member of the NOARK Group to Seller so as to reduce the Working Capital of the NOARK Group on the Closing Date to the Required Working Capital Balance or as close thereto as is reasonably practicable; provided , however , that Seller may not cause any distribution to the extent it would result in a deviation from the Closing Date Estimate, would result in insufficient cash in the Business to support any outstanding drafts or would be in violation of the covenants set forth in Section 5.1 .

2.4 Working Capital Adjustments .

(a) The Purchase Price shall be (i) increased on a dollar for dollar basis to the extent that the Working Capital as of the Closing Date is greater than the Required Working Capital Balance, or decreased on a dollar for dollar basis to the extent that the Working Capital as of the Closing Date is less than the Required Working Capital Balance and (ii) decreased by an amount equal to the Interim Period Economics (the cumulative effect of both such adjustments, being the “ Working Capital Adjustment ”).

 

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(b) No less than 2 Business Days prior to the Closing Date, Seller shall prepare in consultation with, and deliver to, Buyer in writing a good faith estimate of the Working Capital Adjustment (the “ Initial Adjustment ”), together with its calculation of the Working Capital Adjustment in reasonable detail (the “ Closing Date Estimate ”), and the Purchase Price shall be adjusted at the Closing based upon such Closing Date Estimate.

(c) On or before the date that is 60 days after the Closing Date, Buyer shall prepare and deliver to Seller (i) (A) a consolidated balance sheet of the NOARK Group (the “ Working Capital Balance Sheet ”) reflecting the Working Capital as of the Closing (the “Closing Date Working Capital”), and (B) a consolidated statement of the NOARK Group showing in reasonable detail the calculation of the Interim Period Economics, and (ii) a statement (a “ Closing Statement ”) setting forth (x) a calculation of the Working Capital Adjustment, and (y) the Final Purchase Price (which shall take into account the Initial Adjustment made at the Closing pursuant to the Closing Date Estimate), each of which are to be prepared in accordance with GAAP. Seller shall reasonably cooperate with Buyer in the preparation of the Closing Statement and provide to Buyer such data and information as Buyer may reasonably request supporting the amounts reflected in the Closing Statement.

(d) The Closing Statement shall become final and binding upon the Parties on the date (the “ Final Settlement Date ”) that is 30 days following delivery thereof by Buyer unless Seller gives written notice of its bona fide disagreement (“ Dispute Notice ”) to Buyer prior to such date, in which case such Closing Statement (as revised in accordance with Section 2.4(e) , if applicable) shall become final and binding on the earlier of (i) the date upon which Seller and Buyer agree in writing with respect to all matters specified in the Dispute Notice and (ii) the date upon which the Final Closing Statement is issued by the Accountant. Any Dispute Notice shall specify in reasonable detail the item, dollar amount, and basis of any disagreement asserted.

(e) Closing Statement Dispute Resolution.

(i) During the 30 days following the date upon which Buyer receives a Dispute Notice, Seller and Buyer shall attempt in good faith to resolve in writing any differences that they may have with respect to all matters specified in the Dispute Notice. If at the end of such 30 day period (or earlier by mutual agreement) Buyer and Seller have not reached agreement on all such matters, then Buyer and Seller may mutually agree to extend the time to resolve in writing any differences that they may have with respect to all matters specified in the Dispute Notice. In the absence of any such extension or upon the termination of any such extension without any additional extensions, the matters that remain in dispute may be submitted by either Party to a nationally recognized independent accounting firm agreed by the Parties in writing (the “ Accountant ”) for review and resolution.

 

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(ii) Not more than 15 days after the Parties have agreed upon the Accountant, each Party shall submit to the Accountant any supporting materials and calculations with regard to any amounts in dispute in the Closing Statement. The Accountant shall render a decision resolving the matters within 30 days thereafter, unless the Parties reach prior agreement and withdraw the dispute from the Accountant. At the time the Accountant renders its decision, it shall provide a written statement of findings and conclusions regarding the Closing Statement and any disputed amounts set forth therein and shall issue a Final Closing Statement reflecting such decisions.

(iii) The decision of the Accountant shall be final and binding on the Parties. The fees and expenses of the Accountant shall be borne equally by Buyer and Seller. The fees and disbursements of Seller’s independent advisors incurred in connection with the Closing Statement shall be borne by Seller and the fees and disbursements of Buyer’s independent advisors incurred in connection with the Closing Statement shall be borne by Buyer.

(iv) As used in this Agreement, the term “ Final Closing Statement ” shall mean the Closing Statement issued by Buyer or, if different, the Closing Statement agreed by Buyer and Seller or issued by the Accountant.

(f) Not later than 10 days after the Final Settlement Date, (i) if the total of the Working Capital Adjustment set forth on the Final Closing Statement is greater than the total of the Initial Adjustment, Buyer shall pay by wire transfer of immediately available funds to the account or accounts specified by Seller such difference, together with interest at an annual rate equal to the prime rate published in The Wall Street Journal on such date plus two percent (2%) calculated from, but not including, the Closing Date until, and including, the date on which paid or (ii) if the total of the Working Capital Adjustment set forth on the Final Closing Statement is less than the total of the Initial Adjustment, Seller shall pay by wire transfer in immediately available funds, to the account or accounts specified by Buyer such difference, together with interest at an annual rate equal to the prime rate published in The Wall Street Journal on such date plus two percent (2%) calculated from, but not including, the Closing Date until, and including, the date on which paid.

2.5 Proceedings . Except as otherwise specifically provided for herein, all proceedings that will be taken and all documents that will be executed and delivered by the Parties on the Closing Date will be deemed to have been taken and executed simultaneously, and no proceeding will be deemed taken nor any document executed and delivered until all such proceedings have been taken, and all such documents have been executed and delivered.

2.6 Purchase Price Allocation . The Parties acknowledge that the purchase and sale of the Equity Interests pursuant to this Agreement will be treated as a purchase and sale of the Assets for federal income tax purposes (and for purposes of any applicable state taxes that follow the federal treatment). Not later than 140 days after the Closing Date, but in any event prior to December 31, 2009, Buyer shall determine in consultation with Seller and deliver to Seller an allocation of the consideration paid (or treated as paid) for the Assets among such assets in

 

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accordance with Section 1060 of the Code. Except with respect to any payments of interest under Section 2.4(f) and as otherwise as required by Law, any payments from one Party to the other under this Agreement after the Closing Date shall be treated as an adjustment to the consideration paid for the Assets for federal income tax purposes, and Buyer shall revise the allocation described previously as appropriate and deliver the revised allocation to Seller. If the Parties cannot agree on either the initial allocation or any adjusted allocation within 30 days of the provision of such allocation, the Parties will resolve the dispute in accordance with Section 2.4(e) . The Parties agree to file all Tax Returns consistent with such original or any revised allocation and not to take any position inconsistent therewith, except as required by Law.

2.7 Escrow; Liquidated Damages .

(a) Buyer and Seller agree that the liquidated damages owing from Seller to Buyer (i) for Seller’s breach of Section 5.9(b)(i) shall be $5,000,000, and (ii) for breach of Section 5.9(c) shall be $5,000,000. Determination of Seller’s breach shall not be affected by whether such breach resulted from reasons partially or totally outside of Seller’s control, except to the extent such breach was caused solely by Buyer.

(b) If Seller makes the filings required by Section 5.9(c)(i) and Section 5.9(c)(ii) (collectively, the “ FERC Filings ”) on or before the dates specified in such Sections, then Buyer shall, at Seller’s written request, unconditionally instruct the Escrow Agent to release to Seller $2,500,000 of the balance in the Escrow Account as promptly as possible, but in no event later than 3 Business Days after the date of the filing contemplated by Section 5.9(c)(ii) . If Seller fails to file the FERC Filings as required by Section 5.9(c) on or before the dates specified in such Sections, (i) Buyer shall be entitled to instruct the Escrow Agent to release $2,500,000 out of the Escrow Account to Buyer, and (ii) Seller shall also pay to Buyer by wire of immediately available funds, within 3 Business Days of Buyer’s written request therefor, the remaining $2,500,000 owing of such liquidated damages.

(c) If Seller delivers to Buyer the items required under Section 5.9(b)(i) (collectively, the “ Audited Financials ”) on or before the date specified in such Section, then Buyer shall, at Seller’s written request, unconditionally instruct the Escrow Agent to release to Seller $2,500,000 out of the Escrow Account as promptly as possible, but in no event later than 3 Business Days after Buyer’s receipt of such Audited Financials. If Seller fails to deliver the Audited Financials as required by Section 5.9(b)(i) on or before the date specified in such Section, (i) Buyer shall be entitled to instruct the Escrow Agent to release $2,500,000 out of the Escrow Account to Buyer, and (ii) Seller shall also pay to Buyer by wire of immediately available funds, within 3 Business Days of Buyer’s written request therefor, the remaining $2,500,000 owing of such liquidated damages.

(d) Payment to Buyer of the liquidated damages contemplated by this Section 2.7 shall be the sole and exclusive remedy for Seller’s breach of Section 5.9(b)(i) and Section 5.9(c) . The liquidated damages so paid will be treated as a reduction in the purchase price and Seller will irrevocably forfeit the right to any such amount payable and shall, if requested, unconditionally consent in writing to the release of funds so owing to Buyer from the Escrow Account. Buyer shall cause all of the Funds in excess of the Escrow Deposit (each as defined in the Escrow Agreement) to be released to Seller promptly upon termination of the Escrow Agreement in accordance with its terms.

 

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(e) The Parties hereby acknowledge and agree that (i) the amounts described in this Section 2.7 shall constitute liquidated damages because the potential injury to Buyer resulting from Seller’s potential breach of Section 5.9(b)(i) or Section 5.9(c) is uncertain and difficult to quantify, (ii) the amount of such liquidated damages is reasonable and considers (A) the actual or anticipated harm that could be caused by Seller’s potential breach of Section 5.9(b)(i) or Section 5.9(c) , (B) the difficulty of proving the loss arising from any such potential breach, and (C) the difficulty of finding another, adequate remedy at law, and (iii) such liquidated damages are structured to function as damages resulting from Seller’s potential breach of Section 5.9(b)(i) or Section 5.9(c) and not as a penalty.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby represents and warrants to Buyer as follows:

3.1 Organization and Qualification .

(a) Seller 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, lease and operate its property and assets.

(b) AAP is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Oklahoma and has all requisite limited liability company power and authority to own, lease and operate its property and assets.

(c) MAP is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Arkansas and has all requisite limited liability company power and authority to own, lease and operate its property and assets.

(d) NOARK is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Arkansas and has all requisite limited partnership power and authority to conduct the Business as it is now being conducted and to own, lease and operate its property and assets.

(e) Each of OGT and OGG is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Oklahoma and has all requisite limited liability company power and authority to conduct the Business as it is now being conducted and to own, lease and operate its property and assets.

(f) Each of the Ozark Gas Companies is qualified or licensed to do business as a foreign limited liability company, and is in good standing, in each jurisdiction in which ownership of property or the conduct of the Business requires such qualification or license, except where the failure to be so qualified or licensed will not have a Material Adverse Effect.

 

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3.2 Capitalization .

(a) Seller owns all of the Equity Interests, and such Equity Interests constitute all of the issued and outstanding equity interests of the NOARK Holding Companies. The Equity Interests have been duly and validly issued and are fully paid, and are owned by Seller, free and clear of all Liens, other than transfer restrictions imposed on the Equity Interests pursuant to applicable securities Laws and liens under the Senior Secured Credit Facility.

(b) AAP owns a 74% general partnership interest and a 1% limited partnership interest in NOARK, and MAP owns a 25% general partnership interest in NOARK, which partnership interests collectively constitute all of the issued and outstanding equity interests of NOARK (the “ NOARK Partnership Interests ”). The NOARK Partnership Interests have been duly and validly issued and are fully paid, and held by AAP and MAP, free and clear of all Liens, other than transfer restrictions imposed on the NOARK Partnership Interests pursuant to applicable securities Laws and liens under the Senior Secured Credit Facility.

(c) NOARK owns all of the issued and outstanding membership interests of each of OGG and OGT (the “ NOARK Subsidiary Interests ”), and such NOARK Subsidiary Interests constitute all of the issued and outstanding equity interests of the OGG and OGT, respectively. The NOARK Subsidiary Interests have been duly and validly issued and are fully paid, and are owned by NOARK, free and clear of all Liens, other than transfer restrictions imposed on the NOARK Subsidiary Interests pursuant to applicable securities Laws and liens under the Senior Secured Credit Facility. As of the date hereof, NOARK owns all of the issued and outstanding membership interests of NES, and such membership interests constitute all of the issued and outstanding equity interests of NES. The NES membership interests have been duly and validly issued and are fully paid, and, as of the date hereof, are owned by NOARK, free and clear of all Liens, other than transfer restrictions imposed on the NOARK Subsidiary Interests pursuant to applicable securities Laws and liens under the Senior Secured Credit Facility.

(d) There are no outstanding (i) securities convertible into or exchangeable for the equity interests of any member of the NOARK Group, (ii) options, warrants, or other rights to purchase or subscribe for the equity interests of any member of the NOARK Group, (iii) contracts, commitments, agreements, understandings, or arrangements of any kind relating to the issuance of any equity interest in any member of the NOARK Group or any such convertible or exchangeable securities or any such options, warrants, or rights, pursuant to which Seller or its property is subject or bound, or (iv) interests of any Person that would dilute the interests of Seller in any member of the NOARK Group.

(e) Neither Seller nor any member of the NOARK Group has any obligation (contingent or other) to purchase, redeem or otherwise acquire any of the Equity Interests or to provide material funds to, or make any material investment in (in the form of a loan, capital contribution or otherwise), or provide any guarantee with respect to the obligations of, any other Person. Except for this Agreement, there is no voting trust or agreement, operating agreement, partnership agreement, pledge agreement, buy-sell

 

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agreement, agreement with any employee of a member of the NOARK Group, right of first refusal, preemptive right, or proxy relating to any equity securities or securities convertible into the equity securities of any member of the NOARK Group. Neither OGT nor OGG has any Subsidiaries and neither OGT not OGG owns, directly or indirectly, any shares of capital stock, voting rights or other equity interests or investments in any other Person.

(f) NOARK does not have any Subsidiaries, other than OGT, OGG and, as of the date hereof, NES, and NOARK does not own, directly or indirectly, any shares of capital stock, voting rights or other equity interests or investments in any other Person other than OGT, OGG and, as of the date hereof, NES. None of the NOARK Holding Companies has any Subsidiaries other than the Ozark Gas Companies or, as of the date hereof, NES, and none of the NOARK Holding Companies owns, directly or indirectly, any shares of capital stock, voting rights or other equity interests or investments in any Person other than the Ozark Gas Companies and, as of the date hereof, NES. None of the NOARK Holding Companies has, since its formation, engaged in any activities, held any assets or incurred any liabilities other than owning the NOARK Partnership Interests.

3.3 Corporate Records.

(a) Seller has made available to Buyer true, complete and correct copies of the certificates of formation, limited liability company agreements, operating agreements and other organization documents of all members of the NOARK Group.

(b) The minute books of all members of the NOARK Group made available to Buyer accurately reflect in all material respects all other corporate action of the members and board of directors (including committees thereof) of all the members of the NOARK Group. The NOARK Subsidiary Interests, the NOARK Partnership Interests and the Equity Interests are all uncertificated.

3.4 Authority . Seller has all requisite limited liability company authority and power to execute and deliver the Transaction Documents and to consummate the transactions contemplated by the Transaction Documents. The execution and delivery of the Transaction Documents and the consummation of the transactions contemplated by the Transaction Documents have been duly and validly authorized by all required action on the part of Seller and no other proceedings on the part of Seller, including all required approvals of Seller, are necessary to authorize the Transaction Documents or to consummate the transactions contemplated by the Transaction Documents. The Transaction Documents have been duly and validly executed and delivered by Seller and, assuming the Transaction Documents are duly authorized, executed and delivered by Buyer, the Transaction Documents shall constitute a valid and binding agreement of Seller, enforceable against Seller in accordance with their terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, or other similar Laws now or hereafter in effect relating to or affecting creditors’ rights generally, including the effect of statutory and other Laws regarding fraudulent conveyances and preferential transfers, and subject to the limitations imposed by general equitable principles and considerations of public policy.

 

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