Exhibit 1.1
EXECUTION
COPY
6,325,000
Common Units
ATLAS ENERGY RESOURCES,
LLC
UNDERWRITING AGREEMENT
December 12, 2006
UNDERWRITING AGREEMENT
December 12, 2006
UBS Securities LLC
299 Park Avenue
New York, New York 10171-0026
Ladies and Gentlemen:
Atlas Energy Resources, LLC, a
Delaware limited liability company (the “Company”),
proposes to issue and sell to the underwriters named in Schedule
A annexed hereto (the “ Underwriters ”) an
aggregate of 6,325,000 common units (the “ Firm Units
”) representing Class B limited liability company interests
in the Company (the “ Common Units ”). In
addition, the Company proposes to grant to the Underwriters the
option to purchase from the Company up to an additional 948,750
Common Units (the “ Additional Units ”). The
Firm Units and the Additional Units are hereinafter collectively
sometimes referred to as the “ Units .” The
Units are described in the Prospectus, which is defined
below.
The Company hereby acknowledges that
in connection with the proposed offering of the Units contemplated
hereby, it has requested UBS Financial Services Inc. (“
UBS-FinSvc ”) to administer a directed unit program
(the “ Directed Unit Program ”) under which up
to 300,000 Firm Units (the “ Reserved Units ”),
shall be reserved for sale by UBS-FinSvc at the initial public
offering price to the officers and directors of the Company and
officers, directors and employees of the Manager (as defined below)
and other persons having a relationship with the Company as
designated by the Company (the “ Directed Unit
Participants ”) as part of the distribution of the Units
by the Underwriters, subject to the terms of this Agreement, the
applicable rules, regulations and interpretations of the NASD and
all other applicable laws, rules and regulations. The number of
Units available for sale to the general public will be reduced to
the extent that Directed Unit Participants purchase Reserved Units.
The Underwriters may offer any Reserved Units not purchased by
Directed Unit Participants to the general public on the same basis
as the other Units being issued and sold hereunder. The Company has
supplied UBS-FinSvc with names, addresses and telephone numbers of
the individuals or other entities that the Company has designated
to be participants in the Directed Unit Program. It is understood
that any number of those designated to participate in the Directed
Unit Program may decline to do so.
It is understood and agreed by all
parties that the Company was formed to own and operate
substantially all of the natural gas and oil production and
development assets and the investment partnership management
business and the related limited partnerships (the “
Investment Partnerships ”) (collectively, the “
Contributed Business ”) of Atlas America, Inc., a
Delaware corporation (“ AAI ”), as more
particularly described in the Prospectus. Atlas Energy Management,
Inc., a Delaware corporation (the “ Manager ”),
serves as the manager of the Company. At the time of purchase (as
defined below), (i) the Company will be the sole member of
Atlas Energy Operating Company, LLC, a Delaware limited liability
company (“ Operating LLC ”), (ii) the
Operating LLC will be the sole member of AIC, LLC, a Delaware
limited liability company (“ AIC ”), Atlas
Noble, LLC, a Delaware limited liability company (“ Atlas
Noble ”), Viking Resources, LLC, a Pennsylvania limited
liability company (“ Viking ”), Resource Energy,
LLC, a Delaware limited liability company (“ REI
”) and Atlas America, LLC, a Pennsylvania limited liability
company (“ Atlas America LLC ”), and the sole
shareholder of AER Pipeline Construction, Inc., a Delaware
corporation (“ AER Pipeline ”), (iii) AIC
will be the sole member of Atlas Energy Ohio, LLC, an Ohio limited
liability company (“ Atlas Energy Ohio ”), and
Atlas Resources, LLC, a Pennsylvania limited liability company
(“ Atlas Resources ”), and the sole shareholder
of Anthem Securities, Inc., a Delaware corporation (“
Anthem ”), and (iv) REI will be the sole member
of REI-NY, LLC, a Delaware limited liability company (“
REI-NY ”), and Resource Well Services, LLC, a
Delaware
limited liability company (“ RWS
”). As of the date hereof, AAI is the sole member of AIC,
Atlas Noble, Viking, REI and the Company.
Each of AIC, Atlas Noble, Viking,
REI, Atlas America LLC, AER Pipeline, Atlas Energy Ohio, Atlas
Resources, Anthem, REI-NY and RWS is sometimes referred to herein
individually as a “ Subsidiary ” and
collectively, as the “ Subsidiaries. ” AAI, the
Manager, the Company, the Operating LLC and the Subsidiaries are
hereinafter referred to collectively as the “ Atlas
Parties ”. The Company, the Operating LLC and the
Subsidiaries are herein after referred to collectively as the
“ Company Entities .”
It is further understood and agreed
by all parties that prior to the date hereof:
1. Atlas Resources, Inc., a
Pennsylvania corporation, merged with and into Atlas
Resources;
2. Atlas Energy Corporation, an Ohio
corporation, merged with and into Atlas Energy Ohio;
3. Viking Resources Corporation, a
Pennsylvania corporation, merged with and into Viking;
4. Atlas America, Inc., a
Pennsylvania corporation, merged with and into Atlas America
LLC;
5. REI-NY, Inc., a Delaware
corporation, was converted into REI-NY;
6. Resource Well Services, Inc., a
Delaware corporation, was converted into RWS;
7. AIC, Inc., a Delaware
corporation, was converted into AIC;
8. Resource Energy, Inc., a Delaware
corporation, was converted into REI;
9. Atlas Noble Corp., a Delaware
corporation, was converted into Atlas Noble; and
10. AER Pipeline was
formed.
It is further understood and agreed
by all parties that, on or prior to the time of purchase (as
defined below), the following transactions will occur:
i. AAI, the Company and the
Operating LLC shall have entered into a contribution agreement (the
“ Contribution Agreement ”), dated
December 18, 2006, pursuant to which AAI will contribute all
of its membership interests in each of AIC, Atlas Noble, Viking and
REI to the Company in exchange for (a) 30,301,746 Common Units
representing limited liability interests in the Company (“
Sponsor Common Units ”), (b) 748,456 Class A
units (“ Class A Units ”) representing limited
liability interests in the Company, (c) all of the management
incentive interests (as defined in the Company LLC Agreement (as
defined herein)) (“ Management Incentive Interests
”), and (d) the right to receive an aggregate of
$121,730,000;
ii. The public offering of the Firm
Units contemplated hereby (the “ Offering ”)
will be consummated;
iii. AAI will contribute all of the
Class A Units and the Management Incentive Interests to the
Manager; and
iv. The Company will distribute to
AAI an aggregate of $121,730,000.
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v. The Operating LLC, Wachovia Bank,
National Association and the other parties thereto shall have
entered into a credit agreement (the “ Credit
Agreement ”) that provides for a senior secured revolving
credit facility (the “ Credit Facility
”).
vi. The Company, the Operating LLC
and the Manager shall have entered into a management agreement that
provides for the management of the Company (the “
Management Agreement ”).
vii. The Company and AAI shall have
entered into an omnibus agreement (the “ Omnibus
Agreement ”) that governs the relationship between the
Company and AAI.
viii. The Company and the Operating
LLC shall have entered into an amendment and joinder to gas
gathering agreements by which they will become parties to the
existing (A) master natural gas gathering agreement dated as
of February 2, 2000, as amended as of October 25, 2005,
between AAI and Atlas Pipeline Partners, L.P., a Delaware limited
partnership (“ APL ”), and (B) natural gas
gathering agreement dated as of January 1, 2002 , as amended
as of October 25, 2005, between AAI and Atlas Pipeline
Partners, L.P., a Delaware limited partnership, that provide for
natural gas gathering services (the “ Amendment and
Joinder to Gas Gathering Agreements ”).
ix. The Company and the Operating
LLC shall have entered into an amendment and joinder to omnibus
agreement by which they will become parties to the existing omnibus
agreement, dated as of February 2, 2000, between AAI and APL
(the “ Amendment and Joinder to Omnibus Agreement
”).
x. AAI and Anthem shall have entered
into a services agreement, dated as of December 18, 2006 (the
“ Services Agreement ”) that provides for the
provision by Anthem of certain services to AAI.
The transactions set forth in
clauses (1)-(10) and (i)-(x) above are collectively
referred to as the “ Transactions ”. The mergers
described in clauses (1)-(4) above are referred to herein as
the “ Mergers .” The conversions described in
clauses (5)-(9), above are referred to herein as the “
Conversions .” In connection with the consummation of
the Mergers and Conversions, the parties to these transactions
entered into, as applicable, merger agreements, limited liability
company agreements and certificates, articles of merger and certain
other documents to effect the Mergers and Conversions (the “
Merger and Conversion Documents ”). In addition, in
connection with the Transactions, the parties to the Transactions
entered into various transfer agreements, assignments, conveyances,
contribution agreements and related documents (together with the
Contribution Agreement, the “Contribution Documents”).
The documents entered into to effect the Transactions, including
but not limited to the Merger and Conversion Documents, the
Contribution Documents, the Credit Agreement, the Management
Agreement, the Omnibus Agreement, the Amendment and Joinder to Gas
Gathering Agreements, the Amendment and Joinder to Omnibus
Agreement and the Services Agreement, are collectively referred to
herein as the “ Transaction Documents
”).
The Company has prepared and filed,
in accordance with the provisions of the Securities Act of 1933, as
amended, and the rules and regulations thereunder (collectively,
the “Act”), with the Securities and Exchange Commission
(the “ Commission ”) a registration statement on
Form S-1 (File No. 333- 136094) under the Act, including a
prospectus relating to the Units.
Except where the context otherwise
requires, “ Registration Statement ,” as used
herein, means the registration statement, as amended at the time of
such registration statement’s effectiveness for purposes of
Section 11 of the Act, as such section applies to the
respective Underwriters (the “ Effective Time
”), including: (i) all documents filed as a part
thereof, (ii) any information contained in a prospectus filed
with the Commission pursuant to Rule 424(b) under the Act and
deemed, pursuant to Rule 430A or Rule 430C under the Act, to be
part of the registration statement at the Effective Time, and
(iii) any registration
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statement filed pursuant to Rule 462(b) under
the Act. The Company has furnished to you, for use by the
Underwriters and by dealers in connection with the offering of the
Units, copies of one or more preliminary prospectuses relating to
the Units. Except where the context otherwise requires, “
Preliminary Prospectus ,” as used herein, means any
preliminary prospectus, in the form so furnished. Any reference to
the “ most recent Preliminary Prospectus ” shall
be deemed to refer to the latest Preliminary Prospectus included in
the Registration Statement or filed pursuant to Rule 424(b) on or
prior to the date hereof.
Except where the context otherwise
requires, “Prospectus,” as used herein, means the
prospectus filed by the Company with the Commission pursuant to
Rule 424(b) under the Act on or before the second business day
after the date hereof (or such earlier time as may be required
under the Act) or, if no such filing is required, the final
prospectus included in the Registration Statement at the time it
became effective under the Act, in each case in the form furnished
by the Company to you for use by the Underwriters and by dealers in
connection with the offering of the Units.
“ Permitted Free Writing
Prospectuses ,” as used herein, means the documents
listed on Schedule B attached hereto and each
“road show” (as defined in Rule 433 under the Act), if
any, related to the offering of the Units contemplated hereby that
is a “written communication” (as defined in Rule 405
under the Act) (each such road show, a “ Road Show
”).
“ Disclosure Package
,” as used herein, means any Preliminary Prospectus together
with any combination of one or more of the Permitted Free Writing
Prospectuses, if any.
As used in this Agreement, “
business day ” shall mean a day on which the New York
Stock Exchange (the “ NYSE ”) is open for
trading. The terms “herein,” “hereof,”
“hereto,” “hereinafter” and similar terms,
as used in this Agreement, shall in each case refer to this
Agreement as a whole and not to any particular section, paragraph,
sentence or other subdivision of this Agreement. The term
“or,” as used herein, is not exclusive.
The Company has prepared and filed,
in accordance with Section 12 of the “Securities
Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the “ Exchange Act
”),” a registration statement (as amended, the “
Exchange Act Registration Statement ”) on Form 8-A
(File No. 001-33193) under the Exchange Act to register, under
Section 12(b) of the Exchange Act, the class of securities
consisting of the Common Units.
This underwriting agreement (this
“ Agreement ”) is to confirm the agreement
concerning the purchase of the Units from the Company by the
Underwriters.
1. Sale and Purchase . Upon
the basis of the representations and warranties and subject to the
terms and conditions herein set forth, the Company agrees to issue
and sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from
the Company the number of Firm Units set forth opposite the name of
such Underwriter in Schedule A attached hereto, subject
to adjustment in accordance with Section 8 hereof, in each case at
a purchase price of $19.688 per Unit. The Company is advised by you
that the Underwriters intend (i) to make a public offering of
their respective portions of the Firm Units as soon after the
effective date of the Registration Statement as in your judgment is
advisable and (ii) initially to offer the Firm Units upon the
terms set forth in the Prospectus. You may from time to time
increase or decrease the public offering price after the initial
public offering to such extent as you may determine.
In addition, the Company hereby
grants to the several Underwriters the option to purchase, and upon
the basis of the representations and warranties and subject to the
terms and conditions herein set forth, the Underwriters shall have
the right to purchase, severally and not jointly, from the Company,
ratably in accordance with the number of Firm Units to be purchased
by each of them, all or a portion of
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the Additional Units as may be necessary to
cover over-allotments made in connection with the offering of the
Firm Units, at the same purchase price per Unit to be paid by the
Underwriters to the Company for the Firm Units. This option may be
exercised by UBS Securities LLC (“ UBS ”) on
behalf of the several Underwriters at any time and from time to
time on or before the 30th day following the date of the
Prospectus, by written notice to the Company. Such notice shall set
forth the aggregate number of Additional Units as to which the
option is being exercised, and the date and time when the
Additional Units are to be delivered (such date and time being
herein referred to as the “ additional time of
purchase ”); provided , however , that the
additional time of purchase shall not be earlier than the time of
purchase (as defined below) nor earlier than the third business day
after the date on which the option shall have been exercised nor
later than the tenth business day after the date on which the
option shall have been exercised. The number of Additional Units to
be sold to each Underwriter shall be the number that bears the same
proportion to the aggregate number of Additional Units being
purchased as the number of Firm Units set forth opposite the name
of such Underwriter on Schedule A hereto bears to the
total number of Firm Units, subject to adjustment in accordance
with Section 8 hereof.
2. Payment and Delivery .
Payment of the purchase price for the Firm Units shall be made to
the Company by Federal Funds wire transfer, against electronic
delivery of the certificates for the Firm Units in book entry form
to you through the facilities of The Depository Trust Company
(“ DTC ”) for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 9:00 A.M.,
New York City time, on December 18, 2006 (unless another time
shall be agreed to by you and the Company or unless postponed in
accordance with the provisions of Section 8 hereof). The time at
which such payment and delivery are to be made is hereinafter
sometimes called “ the time of purchase .”
Electronic transfer of the Firm Units shall be made to you at the
time of purchase in such names and in such denominations as you
shall specify.
Payment of the purchase price for
the Additional Units shall be made at the additional time of
purchase in the same manner and at the same office as the payment
for the Firm Units. Electronic transfer of the Additional Units
shall be made to you at the additional time of purchase in such
names and in such denominations as you shall specify.
Deliveries of the documents
described in Section 6 hereof with respect to the purchase of the
Units shall be made at the offices of Ledgewood, 1900 Market
Street, Philadelphia, PA 19103, at 9:00 A.M., New York City time,
on the date of the closing of the purchase of the Firm Units or the
Additional Units, as the case may be.
3. Representations and Warranties
of the Atlas Parties . Each of the Atlas Parties, jointly and
severally, represents and warrants to and agrees with each of the
Underwriters that:
(a) Effectiveness of Registration
Statement . The Registration Statement has heretofore become
effective under the Act or, with respect to any registration
statement to be filed to register the offer and sale of Units
pursuant to Rule 462(b) under the Act, will be filed with the
Commission and become effective under the Act no later than 5:00
P.M., New York City time, on the date of determination of the
public offering price for the Units; no stop order of the
Commission preventing or suspending the use of any Preliminary
Prospectus or Permitted Free Writing Prospectus or the
effectiveness of the Registration Statement has been issued, and no
proceedings for such purpose have been instituted or, to the
Company’s knowledge, are threatened by the Commission; the
Exchange Act Registration Statement has become effective as
provided in Section 12 of the Exchange Act.
(b) Registration Statement .
The Registration Statement complied when it became effective,
complies as of the date hereof and, as amended or supplemented, at
the time of purchase, each additional time of purchase, if any, and
at all times during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with Rule 172
under the Act or any similar rule) in connection
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with any sale of Units, will comply, in all
material respects, with the requirements of the Act; the
Registration Statement did not, as of the Effective Time, contain
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; each Preliminary Prospectus
complied, at the time it was filed with the Commission, and
complies as of the date hereof, in all material respects with the
requirements of the Act; at no time during the period that begins
on the earlier of the date of such Preliminary Prospectus and the
date such Preliminary Prospectus was filed with the Commission and
ends at the time of purchase did or will any Preliminary
Prospectus, as then amended or supplemented, include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and
at no time during such period did or will any Preliminary
Prospectus, as then amended or supplemented, together with any
combination of one or more of the then-issued Permitted Free
Writing Prospectuses, if any, include an untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading; the Prospectus will
comply, as of its date, the date that it is filed with the
Commission, the time of purchase, each additional time of purchase,
if any, and at all times during which a prospectus is required by
the Act to be delivered (whether physically or through compliance
with Rule 172 under the Act or any similar rule) in connection with
any sale of Units, in all material respects, with the requirements
of the Act (including, without limitation, Section 10(a) of
the Act); at no time during the period that begins on the earlier
of the date of the Prospectus and the date the Prospectus is filed
with the Commission and ends at the later of the time of purchase,
the latest additional time of purchase, if any, and the end of the
period during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with Rule 172
under the Act or any similar rule) in connection with any sale of
Units did or will the Prospectus, as then amended or supplemented,
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; at no time during the period that begins on the date of
such Permitted Free Writing Prospectus and ends at the time of
purchase did or will any Permitted Free Writing Prospectus, when
considered together with the most recent Preliminary Prospectus,
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided , however , that the Company
makes no representation or warranty with respect to any statement
contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
in reliance upon and in conformity with information furnished in
writing by or on behalf of an Underwriter through you to the
Company expressly for use in the Registration Statement, such
Preliminary Prospectus, the Prospectus or such Permitted Free
Writing Prospectus.
(c) No Other Prospectus .
Prior to the execution of this Agreement, the Company has not,
directly or indirectly, offered or sold any Units by means of any
“prospectus” (within the meaning of the Act) or used
any “prospectus” (within the meaning of the Act) in
connection with the offer or sale of the Units, in each case other
than the Preliminary Prospectuses and the Permitted Free Writing
Prospectuses, if any; the Company has not, directly or indirectly,
prepared, used or referred to any Permitted Free Writing Prospectus
except in compliance with Rules 164 and 433 under the Act; assuming
that such Permitted Free Writing Prospectus is accompanied or
preceded by the most recent Preliminary Prospectus that contains a
price range or the Prospectus, as the case may be, and that such
Permitted Free Writing Prospectus is so sent or given after the
Registration Statement was filed with the Commission (and after
such Permitted Free Writing Prospectus was, if required pursuant to
Rule 433(d) under the Act, filed with the Commission), the sending
or giving, by any Underwriter, of any Permitted Free Writing
Prospectus will satisfy the provisions of Rule 164 or Rule 433
(without reliance on subsections (b), (c) and (d) of Rule
164); the Preliminary Prospectus dated December 5, 2006 is a
prospectus that, other than by reason of Rule 433 or Rule 431 under
the Act, satisfies the requirements of Section 10 of the Act,
including a price range where required by rule; neither the Company
nor the Underwriters are disqualified, by reason
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of subsection (f) or (g) of Rule 164
under the Act, from using, in connection with the offer and sale of
the Units, “free writing prospectuses” (as defined in
Rule 405 under the Act) pursuant to Rules 164 and 433 under the
Act; the Company is not an “ineligible issuer” (as
defined in Rule 405 under the Act) as of the eligibility
determination date for purposes of Rules 164 and 433 under the Act
with respect to the offering of the Units contemplated by the
Registration Statement; the parties hereto agree and understand
that the content of any and all “road shows” (as
defined in Rule 433 under the Act) related to the offering of the
Units contemplated hereby is solely the property of the Company;
the Company has caused there to be made available at least one
version of a “bona fide electronic road show” (as
defined in Rule 433 under the Act) in a manner that, pursuant to
Rule 433(d)(8)(ii) under the Act, causes the Company not to be
required, pursuant to Rule 433(d) under the Act, to file, with the
Commission, any Road Show.
(d) Formation and Qualification
of the Atlas Parties . Each of the Atlas Parties has been duly
formed and is validly existing as a limited liability company or
corporation, as the case may be, is in good standing under the laws
of its respective jurisdiction of formation or incorporation, with
full limited liability company or corporate power and authority to
own, lease and operate its properties and conduct its business as
described in the Registration Statement, the Preliminary
Prospectuses and the Prospectus and to enter into and perform its
obligations under this Agreement and the Operative Agreements (as
defined). Each of the Atlas Parties is duly registered or qualified
to do business and is in good standing as a foreign limited
liability company or corporation, as the case may be, in each
jurisdiction where the ownership or leasing of its properties or
the conduct of its business requires such qualification, except
where the failure to be so registered or qualified and in good
standing would not, individually or in the aggregate, have a
material adverse effect on the business, properties, condition
(financial or otherwise), earnings, operations or prospects of the
Company Entities taken as a whole (a “ Material Adverse
Effect” ).
(e) Sponsor Units . At the
time of purchase, other than the Units, the Company will have no
limited liability company interests issued and outstanding other
than the following:
(i) the Sponsor Common Units held by
AAI; and
(ii) the Class A Units and the
Management Incentive Interests held by the Manager.
All of such Sponsor Common Units,
Class A Units and Management Incentive Interests and the
limited liability company interests represented thereby, as the
case may be, will be duly authorized and validly issued in
accordance with the limited liability agreement of the Company (as
the same may be amended and restated at or prior to the time of
purchase (the “ Company LLC Agreement ”) and
will be fully paid (to the extent required in the Company LLC
Agreement) and nonassessable (except as such nonassessability may
be affected by Sections 18-607 and 18-804 of the Delaware Limited
Liability Company Act (the “ Delaware LLC Act
”)); and AAI and the Manager will own such Sponsor Common
Units, Class A Units and Management Incentive Interests, in
each case, free and clear of any liens, encumbrances, security
interests, equities, charges and other claims (collectively,
“ Liens ”) (except restrictions on
transferability as contained in the Company LLC
Agreement).
(f) Valid Issuance of the
Units . At the time of purchase, the Units to be sold by the
Company and the limited liability company interests represented
thereby, will be duly authorized by the Company LLC Agreement and,
when issued and delivered to the Underwriters against payment
therefor in accordance with the terms hereof, will be validly
issued, fully paid (to the extent required under the Company LLC
Agreement) and nonassessable (except as such nonassessability may
be affected by Sections 18-607 and 18-804 of the Delaware LLC Act
and as otherwise described in the Prospectus under the caption
“Our Limited Liability Company Agreement—Limited
Liability”).
(g) Ownership of Operating LLC
and the Subsidiaries . At the time of purchase, after giving
effect to the Transactions, the Company will, directly or
indirectly, own 100% of the outstanding, limited
7
liability company interests or capital stock, as
the case may be, in the Operating LLC and each of the Subsidiaries
(collectively, the “ Operating Subsidiaries ”)
free and clear of all Liens, except for any Liens pursuant to the
Credit Agreement. At the time of purchase, such ownership interests
will be duly authorized and validly issued in accordance with the
organizational documents of the respective Operating Subsidiaries,
and will be fully paid (to the extent required under their
respective organizational documents) and nonassessable (except as
such nonassessability may be affected by the Delaware General
Corporations Law, the Pennsylvania Limited Liability Company Act,
the Ohio Limited Liability Company Act and Sections 18-607 and
18-804 of the Delaware LLC Act, as applicable).
(h) Ownership of the Manager
. At the time of purchase, AAI will own all of the issued and
outstanding shares of capital stock of the Manager; all of such
shares of capital stock will be duly authorized and validly issued
and fully paid and nonassessable; and at the time of purchase, AAI
will own such shares of capital stock free and clear of all Liens.
There are no options, warrants, preemptive rights or other rights
to subscribe for or purchase, nor any restriction upon the voting
or transfer of any such shares of capital stock.
(i) The Investment
Partnerships . At the time of purchase and at the additional
time of purchase, the Subsidiaries set forth on Schedule C
hereto (i) will be the sole managing general partner of each
of the Investment Partnerships set forth opposite the name of such
Subsidiary, and will own, directly or indirectly, the general
partner interests in such Investment Partnerships set forth
opposite the name of such Subsidiary, free and clear of all Liens,
except for any Liens pursuant to the Credit Agreement and
(ii) will own the limited partner interests in such Investment
Partnership set forth opposite the name of such of Subsidiary, free
and clear of all Liens, except for any Liens pursuant to the Credit
Agreement. Except for any Liens pursuant to the Credit Agreement,
none of the assets of any Investment Partnership are hypothecated,
pledged or otherwise encumbered. The consummation of the
Transactions will not conflict with, result in any breach or
violation of or constitute a default under (nor constitute any
event which with notice, lapse of time or both would result in any
breach or violation of or constitute a default under) (i) the
agreements of limited partnership of any of the Investment
Partnerships, (ii) the drilling operating agreements of any of
the Investment Partnerships or (iii) any other material
agreements to which any of the Investment Partnerships is a party
(collectively, the “ Investment Partnership Documents
”).
(j) No Other Subsidiaries .
Other than its direct or indirect ownership interests in the
Operating Subsidiaries, the Company does not own, and at the time
of purchase will not own, directly or indirectly, any equity or
long-term debt securities of any corporation, partnership, limited
liability company, joint venture, association or other entity,
except with respect to the Investment Partnerships and the joint
ventures listed on Schedule D hereto.
(k) Authority and
Authorization . The Company has all requisite power and
authority under the Company LLC Agreement and the Delaware LLC Act
to issue, sell and deliver (i) the Units, in accordance with
and upon the terms and conditions set forth in this Agreement, the
Company LLC Agreement, the Registration Statement, the most recent
Preliminary Prospectus and the Prospectus, and (ii) the
Sponsor Common Units, Class A Units and Management Incentive
Interests in accordance with the terms and conditions set forth in
the Company LLC Agreement and the Transaction Documents. At the
time of purchase, all limited liability company and corporate
action, as the case may be, required to be taken by the Atlas
Parties or any of their partners, members, unitholders or
stockholders for the authorization, issuance, sale and delivery of
the Units and the Sponsor Common Units, Class A Units and
Management Incentive Interests, the execution and delivery of the
Operative Agreements (as defined below) and the consummation of the
transactions (including the Transactions) contemplated by this
Agreement and the Operative Agreements, shall have been validly
taken.
8
(l) Conformity of Securities to
Description . The Units, when issued and delivered in
accordance with the terms of the Company LLC Agreement and against
payment therefor as provided herein, and the Sponsor Common Units,
Class A Units and Management Incentive Interests, when issued
and delivered in accordance with the terms of the Company LLC
Agreement, will conform in all material respects to the
descriptions thereof contained in the Registration Statement, the
most recent Preliminary Prospectus, the Prospectus and any
Permitted Free Writing Prospectus.
(m) Authorization of
Agreement . This Agreement has been duly authorized and validly
executed and delivered by each of the Atlas Parties.
(n) Enforceability of Other
Agreements . At or before the time of purchase:
(i) the Company LLC Agreement will
be duly authorized, executed and delivered by the Members (as
defined in the Company LLC Agreement) and is a valid and legally
binding agreement of the Initial Member (as defined in the Company
LLC Agreement) and the Members, enforceable against the Initial
Members and the Members in accordance with its terms;
(ii) the limited liability company
agreement or articles of incorporation and bylaws, as applicable,
of each of the Manager, the Operating LLC and the Subsidiaries
(together with the Company LLC Agreement, the “ Atlas
Parties Operative Agreements ”) will have been duly
authorized, executed and delivered by the parties thereto and will
be valid and legally binding agreements of the parties thereto,
enforceable against such parties in accordance with their
respective terms; and
(iii) the Transaction Documents will
have been duly authorized, executed and delivered by the parties
thereto and will be valid and legally binding agreements of the
parties thereto, enforceable against such parties in accordance
with their respective terms;
provided that
, with respect to each agreement
described in this Section 3(n), the enforceability thereof may be
limited by (A) bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws relating to or
affecting creditors’ rights generally and by general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); and
(B) public policy, applicable laws relating to fiduciary
duties and indemnification and an implied covenant of good faith
and fair dealing. The Atlas Parties Operative Agreements and the
Transaction Documents are herein referred to as the “
Operative Agreements .”
(o) Sufficiency of the
Transaction Documents . The Transaction Documents will be
legally sufficient to transfer or convey to the Company, directly
or indirectly, good title to all of the outstanding member
interests in the Operating LLC and the Subsidiaries and the Assets
(as defined therein), subject only to matters contained in the
Contribution Documents and, with respect to the Transferred Assets,
to encumbrances that do not materially adversely affect the value
thereof or the ability of the Company Entities to own and operate
them in substantially the same manner as they were operated
immediately prior to the time of purchase. Upon execution and
delivery of the Transaction Documents by the parties thereto, the
Company will succeed, indirectly through the Operating LLC and the
Subsidiaries, in all material respects to the business, assets,
properties, partnership interests, liabilities and operations as
reflected in the pro forma financial statements of the Company
included in the Registration Statement, the Preliminary
Prospectuses and the Prospectus.
(p) Effectiveness of Mergers and
Conversions . The Mergers and Conversions are effective under
the Pennsylvania Business Corporation Law, Pennsylvania Limited
Liability Company Law, Ohio Limited Liability Company Act, the DGCL
and the Delaware LLC Act, as applicable.
9
(q) No Default or Conflicts .
No Atlas Party is in breach or violation of or in default under
(nor has any event occurred which with notice, lapse of time or
both would result in any breach or violation of, constitute a
default under or give the holder of any indebtedness (or a person
acting on such holder’s behalf) the right to require the
repurchase, redemption or repayment of all or a part of such
indebtedness under) (i) its organizational documents, or
(ii) any indenture, mortgage, deed of trust, bank loan or
credit agreement or other evidence of indebtedness, or any license,
lease, contract or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound or
affected, except as disclosed in the Registration Statement, the
Preliminary Prospectuses, the Prospectus and any Permitted Free
Writing Prospectus and, in the case of clause (ii), for any such
breaches, violations or defaults as would not, individually or in
the aggregate, have a Material Adverse Effect. The execution,
delivery and performance of this Agreement by the Atlas Parties,
the issuance and sale of the Units and the consummation of the
transactions contemplated hereby (including the Transactions) will
not (i) conflict with, result in any breach or violation of or
constitute a default under (nor constitute any event which with
notice, lapse of time or both would result in any breach or
violation of or constitute a default under) the organizational
documents of any of the Atlas Parties, or any federal, state, local
or foreign law, regulation or rule or any decree, judgment or order
applicable to any of the Atlas Parties, or (ii) conflict with,
result in any breach or violation of or constitute a default under
(nor constitute any event which with notice, lapse of time or both
would result in any breach or violation of or constitute any
default under) any indenture, mortgage, deed of trust, bank loan or
credit agreement or other evidence of indebtedness, or any license,
lease, contract or other agreement or instrument to which any Atlas
Party is a party or by which any of them or any of their respective
properties may be bound or affected, except, in the case of clause
(ii), for any such breach, violation or default that would not have
a Material Adverse Effect.
(r) No Consents . Except for
any approvals, authorizations, consents, orders or filings that, if
not obtained or made, would not have a Material Adverse Effect, no
approval, authorization, consent or order of or filing with any
federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency is required in
connection with the (i) execution, delivery and performance of
this Agreement or the Operative Agreements by the Atlas Parties
(ii) issuance and sale of the Units or the consummation by the
Atlas Parties of the Transactions other than registration of the
Units under the Act, which has been or will be effected, and any
necessary qualification under the securities or blue sky laws of
the various jurisdictions in which the Units are being offered by
the Underwriters or under the rules and regulations of the
NASD.
(s) No Preemptive Rights,
Registration Rights or Options . Except as described in the
Registration Statement, the Preliminary Prospectuses, the
Prospectus and any Permitted Free Writing Prospectus, there are no
options, warrants, preemptive rights or other rights to subscribe
for or purchase, nor any restriction upon the voting or transfer
of, any ownership interests in, or shares of capital stock of, any
Company Entity. Neither the filing of the Registration Statement
nor the offering or sale of the Units as contemplated by this
Agreement gives rise to any rights for or relating to the
registration of any Units or other securities of any of the Company
Entities, other than as provided in the Company LLC Agreement or
the right of any person to act as an underwriter or as a financial
advisor to any of the Atlas Parties in connection with the offer
and sale of the Units.
(t) Permits . Each of the
Company Entities and the Manager has, or at the time of purchase
will have, all licenses, authorizations, consents and approvals of
governmental or regulatory authorities (“ permits
”) as are necessary to own or lease its properties and to
conduct its business in the manner described in the Registration
Statement, the Preliminary Prospectuses, the Prospectus and any
Permitted Free Writing Prospectus, subject to such qualifications
as may be set forth in the Registration Statement, the Preliminary
Prospectuses, the Prospectus and any Permitted Free Writing
Prospectus and except for such permits that, if not obtained, would
not have a Material Adverse Effect; none of the Company Entities or
the Manager is in violation of, or in default under, or has
received notice of any proceedings
10
relating to revocation or modification of, any
such permit, except where such violation, default, revocation or
modification would not, individually or in the aggregate, have a
Material Adverse Effect.
(u) Disclosure of Certain
Items . All legal or governmental proceedings, affiliate
transactions, off-balance sheet transactions, contracts, licenses,
agreements, leases or documents of a character required to be
described in the Registration Statement, the Preliminary
Prospectuses and the Prospectus or to be filed as an exhibit to the
Registration Statement have been so described or filed as
required.
(v) Litigation . There are no
actions, suits, claims, investigations or proceedings pending or,
to the knowledge of the Atlas Parties after due inquiry,
threatened, to which any of the Atlas Parties or of which any of
their respective properties is or would be subject at law or in
equity, before or by any federal, state, local or foreign
governmental or regulatory commission, board, body, authority or
agency, except any such action, suit, claim, investigation or
proceeding that would not result in a judgment, decree or order
having, individually or in the aggregate, a Material Adverse Effect
or preventing consummation of the transactions contemplated hereby
(including the Transactions).
(w) Independent Public
Accountants . Grant Thornton LLP, whose reports on the combined
financial statements of Atlas America E&P Operations and the
balance sheet of the Company are filed with the Commission as part
of the Registration Statement, the Preliminary Prospectuses and the
Prospectus, are independent public accountants as required by the
Act and by the rules of the Public Company Oversight
Board.
(x) Financial Statements .
The (i) audited financial statements included in the
Registration Statement, any Preliminary Prospectus, the Prospectus
and any Permitted Free Writing Prospectus, together with the
related notes, present fairly the financial position of the
entities purported to be shown thereby as of the dates indicated
and the consolidated results of operations and cash flows of such
entities for the periods specified and have been prepared in
compliance with the requirements of the Act and in conformity with
generally accepted accounting principles applied on a consistent
basis during the periods involved, except to the extent disclosed
therein, (ii) unaudited historical financial statements or
data included in the Registration Statement, any Preliminary
Prospectus, the Prospectus and any Permitted Free Writing
Prospectus (that, with respect to the financial statements or data
as of, and for the years ended, September 30, 2001 and 2002,
do not contain footnotes) present fairly the financial position of
the entities purported to be shown thereby as of the dates
indicated and the consolidated results of operations of such
entities for the periods specified, and (iii) pro forma
financial statements or data included in the Registration
Statement, any Preliminary Prospectus, the Prospectus and any
Permitted Free Writing Prospectus comply with the requirements of
Regulation S-X of the Act and the assumptions used in the
preparation of such pro forma financial statements and data are
reasonable, the pro forma adjustments used therein are appropriate
to give effect to the transactions or circumstances described
therein and the pro forma adjustments have been properly applied to
the historical amounts in the compilation of those statements and
data; the other financial and statistical data set forth in the
Registration Statement, any Preliminary Prospectus or any Permitted
Free Writing Prospectus are accurately presented and prepared on a
basis consistent with the financial statements and books and
records of the Company; there are no financial statements
(historical or pro forma) that are required to be included in the
Registration Statement, any Preliminary Prospectus, the Prospectus
and any Permitted Free Writing Prospectus that are not included as
required; and the Company Entities do not have any material
liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not described in the Registration
Statement, any Preliminary Prospectus, the Prospectus and any
Permitted Free Writing Prospectus; and all disclosures contained in
the Registration Statement, any Preliminary Prospectus, the
Prospectus and any Permitted Free Writing Prospectus regarding
“non-GAAP financial measures” (as such term is defined
by
11
the rules and regulations of the Commission)
comply with the Regulation G of the Exchange Act and Item 10
of Regulation S-K under the Act, to the extent
applicable.
(y) No Material Adverse
Change . Subsequent to the respective dates as of which
information is given in the Registration Statement, the Preliminary
Prospectuses, the Prospectus and any Permitted Free Writing
Prospectus, in each case excluding amendments or supplements to the
foregoing made after the execution of this Agreement, there has not
been (i) any material adverse change, or any development
involving a prospective material adverse change, in the business,
properties, management, financial condition or results of
operations of the Company Entities taken as a whole, (ii) any
transaction that is material to the Company Entities taken as a
whole, (iii) any obligation, direct or contingent (including
any off-balance sheet obligations), incurred by any Company
Entities, that is material to the Company Entities taken as a
whole, (iv) any material change in the capitalization, or
material increase in the long-term debt, of the Company Entities or
(v) any adverse change in or affecting the general affairs,
condition (financial or otherwise), business, prospects, assets or
results of operations of the Company Entities taken as a whole.
None of the Company Entities has sustained since the date of the
last audited financial statements included in the Registration
Statement, the Preliminary Prospectuses, the Prospectus and any
Permitted Free Writing Prospectus any loss or interference with its
respective business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree.
(z) Lock-Up Agreement . The
Company has obtained for the benefit of the Underwriters the
agreement (a “ Lock-Up Agreement ”), in the form
set forth as Exhibit A hereto, of each of the
Company’s directors and officers, any Directed Unit
Participant that purchases in excess of $100,000 and each holder of
the Sponsor Units or any security convertible into or exercisable
or exchangeable for Common Units, or any warrant or other right to
purchase Common Units or any such security.
(aa) Investment Company .
None of the Company Entities is now and, after giving effect to the
offering and sale of the Units, will not be an “investment
company” or an entity “controlled” by an
“investment company,” as such terms are defined in the
Investment Company Act of 1940, as amended (the “
Investment Company Act ”).
(bb) Independent Petroleum
Engineers. Wright & Company, Inc., whose report dated
July 12, 2006 (the “ Company Reserve Report
”) is referenced in the Prospectus and who has delivered the
letter referred to in Section 6(e) hereof, was, as of the date of
such report, and is, as of the date hereof, an independent
petroleum engineer with respect to AAI and the Company.
(cc) Reserves Data. The
information underlying the estimates of oil and natural gas
reserves of AAI, which AAI prepared and supplied to
Wright & Company, Inc. for the purpose of preparing the
Company Reserve Report, was true and correct in all material
respects on the dates such estimates were made and such information
was supplied and was prepared in accordance with customary industry
practices; the Company is not aware of any facts or circumstances
that would result in an adverse change in the reserves, or the
present value of future net cash flows therefrom, as described in
the most recent Preliminary Prospectus and as reflected in the
Company Reserve Report, that would reasonably be expected to have a
Material Adverse Effect; estimates of such reserves and present
values as described in the most recent Preliminary Prospectus and
reflected in the Company Reserve Report comply in all material
respects with applicable requirements of Regulation S-X and
Industry Guide 2 under the Securities Act.
12
(dd) Title. At the time of
purchase and at each additional time of purchase, one or more
Company Entities will have:
(i) good and defensible title to the
producing oil and gas property interests (including the wells and
the working and net revenue interests attributable thereto) (the
“ Wells ”) of AAI included in the Company
Reserve Report, subject only to encumbrances that do not materially
adversely affect the value of such oil and gas property interests
or the ability of the Company Entities to operate such oil and gas
property interests in substantially the same manner as they were
operated immediately prior to the time of purchase and
(ii) good and defensible title to each oil and gas lease as to
which proved undeveloped reserves were assigned in the Reserve
Report (the “ Leases ”), subject only to
encumbrances that do not materially adversely affect the value of
the such Lease or, in the event that the Company Entities do not
have good and defensible title to such Lease (each, a “
Defective Lease ”), then (a) the Company Entities
have good and defensible title to an oil and gas lease as to which
no reserves were indicated therefor in the Company Reserve Report
(each, a “ Substitute Lease ”), (b) one or
more drilling locations have been identified for such Substitute
Lease as of the date hereof, (c) the Company Entities have a
reasonable expectation that they will drill a well on one or more
of such drilling locations on the Substitute Lease within the 24
months following the date hereof, (d) the Company Entities
have a reasonable expectation that the wells expected to be drilled
at such locations on the Substitute Lease within such 24-month
period are generally comparable in reserve potential to the
reserves assigned to such Defective Lease in the Company Reserve
Report and (e) such Substitute Lease is not and has not been
otherwise utilized for purposes of this clause (ii) with
respect to another Defective Lease; and
(ii) valid and indefeasible easement
rights or fee ownership interests in and to the lands on which any
of the Wells, Leases and Substitute Leases are located as of the
time of purchase;
(in each case) subject only to
matters contained in the Contribution Documents and to encumbrances
that do not materially adversely affect the value of the Wells,
Leases and Substitute Leases, as the case may be, or the ability of
the Company Entities to own and operate them in substantially the
same manner as they were operated immediately prior to the time of
purchase.
(ee) Intellectual Property .
At the time of purchase and at each additional time of purchase,
the Company Entities will own, or will have obtained valid and
enforceable licenses for, or other rights to use, the inventions,
patent applications, patents, trademarks (both registered and
unregistered), tradenames, service names, copyrights, trade secrets
and other proprietary information described in the Registration
Statement, the Preliminary Prospectuses, the Prospectus and any
Permitted Free Writing Prospectus as being owned or licensed by
them or which are necessary for the conduct of their respective
businesses, except where the failure to own, license or have such
rights would not, individually or in the aggregate, have a Material
Adverse Effect.
(ff) Labor and Employee Benefits
Matters . There is (A) no unfair labor practice complaint
pending or, to the knowledge of the Atlas Parties, threatened
against any of the Atlas Parties, and no grievance or arbitration
proceeding arising out of or under collective bargaining agreements
is pending or threatened, (B) no strike, labor dispute,
slowdown or stoppage pending or, to the knowledge of the Atlas
Parties, threatened against any of the Atlas Parties, (C) no
union representation dispute currently existing concerning the
employees of any of the Atlas Parties, (D) nor has there been
in the past, any violation of any federal, state, local or foreign
law relating to discrimination in the hiring, promotion or pay of
employees, any applicable wage or hour or worker classification
laws concerning the employees of any of the Atlas Parties and
(E) to the knowledge of the Atlas Parties, no union organizing
activities or collective bargaining negotiations are currently
taking place concerning any of the employees of any of the Atlas
Parties. With respect to each employee benefit plan, within the
meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ ERISA ”),
that is sponsored, maintained, or
13
contributed to by any Atlas Party for employees
or former employees of such Atlas Party, or that was sponsored,
maintained, or contributed to within six years prior to the date of
this Agreement, by any corporation, trade, business or entity under
common control with any Atlas party, within the meaning of
Section 414(b), (c), or (m) of the Internal Revenue Code
of 1986, as amended (the “ Code ”) or
Section 4001 of ERISA, except as would not, individually or in
the aggregate, have a Material Adverse Effect, (i) such plan
has been maintained in compliance with its terms and the
requirements of any applicable statutes, orders, rules and
regulations, including but not limited to ERISA and the Code,
(ii) no prohibited transaction, within the meaning of
Section 406 of ERISA or Section 4975 of the Code, has
occurred with respect to any such plan excluding any transactions
effected pursuant to a statutory or administrative exemption,
(iii) for each such plan that is subject to the funding rules
of Section 412 of the Code or Section 302 of ERISA, no
“accumulated funding deficiency” as defined in
Section 412 of the Code has been incurred, whether or not
waived, (iv) all contributions (including installments) to
such plan required by Section 302 of ERISA or Section 412
of the Code have been timely made, and (v) the fair market
value of the assets of each such plan (excluding for these purposes
accrued but unpaid contributions) exceeds the present value of all
benefits accrued under such plan determined using reasonable
actuarial assumptions. No Atlas Party contributes or has an
obligation to contribute, and has not within six years prior to the
date of this Agreement contributed or had an obligation to
contribute, to a multiemployer plan within the meaning of
Section 3(37) of ERISA.
(gg) Environmental Compliance
. Each of the Company Entities and their respective properties,
assets and operations are in compliance with, and hold all permits,
authorizations and approvals required under, Environmental Laws (as
defined below), except to the extent that failure to so comply or
to hold such permits, authorizations or approvals would not,
individually or in the aggregate, have a Material Adverse Effect;
there are no past, present or, to the knowledge of the Atlas
Parties, reasonably anticipated future events, conditions,
circumstances, activities, practices, actions or omissions that
could reasonably be expected to give rise to any costs or
liabilities to any Company Entity, except as would not,
individually or in the aggregate, have a Material Adverse Effect;
except as would not, individually or in the aggregate, have a
Material Adverse Effect, no Company Entity, to the knowledge of any
Atlas Party, (i) is the subject of any pending investigation
by a government authority, (ii) has received any notice or
claim, (iii) is a party to by any pending or threatened
action, suit or proceeding, (iv) is bound by any judgment,
decree or order or (v) has entered into any written agreement
assuming any obligations, in each case relating to any alleged
violation of any Environmental Law or any actual or alleged release
or cleanup at any location of any Hazardous Materials, except as
would not, individually or in the aggregate, have a Material
Adverse Effect. As used herein, “ Environmental Law
” means any applicable federal, state or local laws or
regulations relating to the protection of human health and safety
and the environment, including those imposing liability or
standards of conduct concerning any Hazardous Materials, and
“ Hazardous Materials ” means (A) any
“hazardous substance” as defined in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended, (B) any “hazardous waste” as defined in
the Resource Conservation and Recovery Act, as amended,
(C) any petroleum or petroleum product, (D) any
polychlorinated biphenyl and (E) any pollutant or contaminant
or hazardous, dangerous or toxic chemical, material, waste or
substance regulated under or within the meaning of any other
applicable Environmental Law.
(hh) Environmental Compliance
Review . In the ordinary course of their business, the Atlas
Parties conduct a periodic review of the effect of the then
existing Environmental Laws on their business, operations and
properties and claims alleging potential liability or
responsibility for violation of any Environmental Law on their
businesses, operations and properties.
(ii) Tax Returns . All tax
returns required to be filed by the Atlas Parties have been filed,
and all taxes and other assessments of a similar nature (whether
imposed directly or through withholding) including any interest,
additions to tax or penalties applicable thereto due or claimed to
be due from such
14
entities have been paid, other than those that
are being contested in good faith and for which adequate reserves
have been provided.
(jj) Insurance . The Atlas
Parties maintain insurance covering their properties, operations,
personnel and businesses; such insurance insures against such
losses and risks to an extent which is reasonably adequate in
accordance with customary industry practice to protect the Company
Entities and their businesses. All such insurance is fully in force
on the date hereof and will be fully in force at the time of
purchase and any additional time of purchase. None of the Atlas
Parties has received notice from any insurer or agent of such
insurer that substantial capital improvements or other expenditures
will have to be made in order to continue such
insurance.
(kk) Contracts and Agreements
. The Atlas Parties have not sent or received any communication
regarding termination of, or intent not to renew, any of the
contracts or agreements referred to or described in, or filed as an
exhibit to, the Registration Statement, and no such termination or
non-renewal has been threatened by the Atlas Parties or, to the
knowledge of any Atlas Party, any other party to any such contract
or agreement.
(ll) Prohibition on
Dividends. No Operating Subsidiary is prohibited, directly or
indirectly, from paying any dividends to the Company, from making
any other distribution on such Operating Subsidiary’s limited
liability company interests, from repaying to the Company any loans
or advances to such Operating Subsidiary from the Company or from
transferring any of such Operating Subsidiary’s property or
assets to the Company or any other Operating Subsidiary, except as
described in or contemplated by the Registration Statement and the
Prospectus.
(mm) Books and Records . The
Atlas Parties maintain a system of internal accounting controls
sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with
management’s general or specific authorization;
(ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with accounting
principles generally accepted in the United States and to maintain
accountability for assets; (iii) access to assets is permitted
only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any
differences.
(nn) Sarbanes-Oxley Act . The
Atlas Parties have taken all necessary actions to ensure that,
upon, and at all times after, the filing of the Registration
Statement, the Company Entities and their respective officers and
directors, in their capacities as such, will be in compliance in
all material respects with the applicable provisions of the
Sarbanes-Oxley Act of 2002 (the “ Sarbanes-Oxley Act
”) and the rules and regulations promulgated thereunder.
There are no outstanding loans, advances (except normal advances
for business expenses in the ordinary course of business) or
guarantees of indebtedness by any Atlas Party to or for the benefit
of any of the officers or directors of Atlas Party or their
respective family members, except as disclosed in the Registration
Statement and the Prospectus. No Atlas Party has, in violation of
the Sarbanes-Oxley Act of 2002, directly or indirectly, extended or
maintained credit, arranged for the extension of credit, or renewed
an extension of credit, in the form of a personal loan to or for
any director or executive officer of any Atlas Party.
(oo) Certain Relationships and
Related Transactions. No relationship, direct or indirect,
exists between or among any Atlas Party, on the one hand, and the
directors, officers, members, partners, stockholders, customers or
suppliers of any Atlas Party on the other hand that is required to
be described in the Registration Statement, the Preliminary
Prospectuses and the Prospectus that is not so
described.
(pp) Statistical Data . Any
statistical and market-related data included in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus are
15
based on or derived from sources that the Atlas
Parties believe to be reliable and accurate, and the Company has
obtained the written consent to the use of such data from such
sources to the extent required.
(qq) Payment or Receipt of
Funds . None of the Company Entities nor, to the knowledge of
any Atlas Party, any director, officer, employee or agent of any
Company Entity has made any payment of funds of any Company Entity
or received or retained any funds in violation of any law, rule or
regulation (including, without limitation, the Foreign Corrupt
Practices Act of 1977), which payment, receipt or retention of
funds is of a character required to be disclosed in the
Registration Statement, any Preliminary Prospectus, the Prospectus
or any Permitted Free Writing Prospectus.
(rr) Money Laundering Laws.
The operations of the Company Entities are and have been conducted
at all times in compliance with applicable financial recordkeeping
and reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of
all jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively,
the “ Money Laundering Laws ”); and no action,
suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator or non-governmental authority
involving any of the Company Entities with respect to the Money
Laundering Laws is pending or, to the knowledge of the Atlas
Parties, threatened.
(ss) OFAC. None of the
Company Entities nor, to the knowledge of the Atlas Parties, any
director, officer, agent, employee or affiliate of the Company
Entities is currently subject to any U.S. sanctions administered by
the Office of Foreign Assets Control of the U.S. Treasury
Department (“ OFAC ”); and the Atlas Parties
will not directly or indirectly use the proceeds of the offering
contemplated hereby, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or
other person or entity for the purpose of financing the activities
of any person currently subject to any U.S. sanctions administered
by OFAC.
(tt) Stabilization or
Manipulation . No Atlas Party has taken, directly or
indirectly, any action designed, or which has constituted or might
reasonably be expected to cause or result in, under the Exchange
Act or otherwise, the stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of the
Units.
(uu) NASD Affiliations .
Except for Anthem, to the Company’s knowledge, there are no
affiliations or associations between any member of the NASD and any
of the Company’s officers or directors or the Company’s
5% or greater securityholders, except as set forth in the
Registration Statement, the Preliminary Prospectuses, the
Prospectus and any Permitted Free Writing Prospectus.
(vv) NYSE Listing . The Units
have been approved for listing on the NYSE, subject only to
official notice of issuance.
(ww) Directed Unit Program
Matters . The Registration Statement, the Preliminary
Prospectuses, the Prospectus and any Permitted Free Writing
Prospectus comply, and any further amendments or supplements
thereto will comply, with any applicable laws or regulations of any
foreign jurisdiction in which any Preliminary Prospectus, the
Prospectus or any Permitted Free Writing Prospectus is distributed
in connection with the Directed Unit Program; and no approval,
authorization, consent or order of or filing with any governmental
or regulatory commission, board, body, authority or agency, other
than those obtained, is required in connection with the offering of
the Reserved Units in any jurisdiction where the Reserved Units are
being offered.
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(xx) No Unlawful Influence .
The Atlas Parties have not offered, or caused the Underwriters to
offer, Units to any person pursuant to the Directed Unit Program
with the intent to influence unlawfully (i) a customer or
supplier of the Company or any of the Operating Subsidiaries to
alter the customer’s or supplier’s level or type of
business with the Company or any of the Operating Subsidiaries, or
(ii) a trade journalist or publication to write or publish
favorable information about the Company or any of the Operating
Subsidiaries or any of their respective products or
services.
(yy) Each “forward-looking
statement” (within the meaning of Section 27A of the Act
or Section 21E of the Exchange Act) contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus
or any Permitted Free Writing Prospectus has been made or
reaffirmed with a reasonable basis and in good faith.
In addition, any certificate signed
by any officer of the Atlas Parties and delivered to the
Underwriters or counsel for the Underwriters pursuant to this
Agreement shall be deemed to be a representation and warranty by
the relevant Atlas Party, as the case may be, as to matters covered
thereby, to each Underwriter.
4. Certain Covenants of the Atlas
Parties . The Atlas Parties, jointly and severally, agree with
the several Underwriters that:
(a) The Company will furnish such
information as may be required and otherwise to cooperate in
qualifying the Units for offering and sale under the securities or
blue sky laws of such states or other jurisdictions as you may
designate and to maintain such qualifications in effect so long as
you may request for the distribution of the Units; provided
that the Company shall not be required to qualify as a foreign
corporation or to consent to the service of process under the laws
of any such jurisdiction (except service of process with respect to
the offering and sale of the Units); and to promptly advise you of
the r
