Exhibit 4.01
EQT MIDSTREAM PARTNERS, LP
as Issuer
and
THE SUBSIDIARY GUARANTORS PARTY HERETO
and
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.
as Trustee
Indenture
Dated as of August 1, 2014
Debt Securities
EQT MIDSTREAM PARTNERS, LP
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of August 1, 2014
|
|
|
|
|
Section of
|
|
|
Trust Indenture
|
Section(s) of
|
Act of 1939
|
Indenture
|
|
|
§ 310
|
(a)(1)
|
7.10
|
|
|
(a)(2)
|
7.10
|
|
|
(a)(3)
|
Not Applicable
|
|
(a)(4)
|
Not Applicable
|
|
(a)(5)
|
7.10
|
|
|
(b)
|
7.08, 7.10
|
§ 311
|
(a)
|
7.11
|
|
|
(b)
|
7.11
|
|
|
(c)
|
Not Applicable
|
§ 312
|
(a)
|
2.07
|
|
|
(b)
|
11.03
|
|
|
(c)
|
11.03
|
|
§ 313
|
(a)
|
7.06
|
|
|
(b)
|
7.06
|
|
|
(c)
|
7.06
|
|
|
(d)
|
7.06
|
|
§ 314
|
(a)
|
4.03, 4.04
|
|
(b)
|
Not Applicable
|
|
(c)(1)
|
11.04
|
|
|
(c)(2)
|
11.04
|
|
|
(c)(3)
|
Not Applicable
|
|
(d)
|
Not Applicable
|
|
(e)
|
11.05
|
|
§ 315
|
(a)
|
7.01(b)
|
|
(b)
|
7.05
|
|
|
(c)
|
7.01(a)
|
|
(d)
|
7.01(c)
|
|
(d)(1)
|
7.01(c)(1)
|
|
(d)(2)
|
7.01(c)(2)
|
|
(d)(3)
|
7.01(c)(3)
|
|
(e)
|
6.11
|
|
§ 316
|
(a)(1)(A)
|
6.05
|
|
|
(a)(1)(B)
|
6.04
|
|
|
(a)(2)
|
Not Applicable
|
|
(a)(last sentence)
|
2.11
|
|
|
(b)
|
6.07
|
|
§ 317
|
(a)(1)
|
6.08
|
|
|
(a)(2)
|
6.09
|
|
|
(b)
|
2.06
|
|
§ 318
|
(a)
|
11.01
|
|
Note:
This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.
i
TABLE OF CONTENTS
|
|
|
|
|
|
|
Page
|
|
|
|
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE
|
1
|
|
|
|
|
SECTION 1.01
|
Definitions
|
1
|
|
SECTION 1.02
|
Other Definitions
|
6
|
|
SECTION 1.03
|
Incorporation by Reference of Trust Indenture Act
|
6
|
|
SECTION 1.04
|
Rules of Construction
|
7
|
|
|
|
|
|
ARTICLE II THE SECURITIES
|
7
|
|
|
|
|
|
SECTION 2.01
|
Amount Unlimited; Issuable in Series
|
7
|
|
SECTION 2.02
|
Denominations
|
10
|
|
SECTION 2.03
|
Forms Generally
|
10
|
|
SECTION 2.04
|
Execution, Authentication, Delivery and Dating
|
11
|
|
SECTION 2.05
|
Registrar and Paying Agent
|
13
|
|
SECTION 2.06
|
Paying Agent to Hold Money in Trust.
|
13
|
|
SECTION 2.07
|
Holder Lists
|
14
|
|
SECTION 2.08
|
Transfer and Exchange
|
14
|
|
SECTION 2.09
|
Replacement Securities
|
14
|
|
SECTION 2.10
|
Outstanding Securities
|
15
|
|
SECTION 2.11
|
Original Issue Discount and Treasury Securities
|
15
|
|
SECTION 2.12
|
Temporary Securities
|
16
|
|
SECTION 2.13
|
Cancellation
|
16
|
|
SECTION 2.14
|
Payments; Defaulted Interest
|
16
|
|
SECTION 2.15
|
Persons Deemed Owners
|
17
|
|
SECTION 2.16
|
Computation of Interest
|
17
|
|
SECTION 2.17
|
Global Securities; Book-Entry Provisions
|
17
|
|
|
|
|
|
ARTICLE III REDEMPTION
|
19
|
|
|
|
|
SECTION 3.01
|
Applicability of Article
|
19
|
|
SECTION 3.02
|
Notice to the Trustee
|
20
|
|
SECTION 3.03
|
Selection of Securities To Be Redeemed
|
20
|
|
SECTION 3.04
|
Notice of Redemption
|
20
|
|
SECTION 3.05
|
Effect of Notice of Redemption
|
21
|
|
SECTION 3.06
|
Deposit of Redemption Price
|
21
|
|
SECTION 3.07
|
Securities Redeemed in Part
|
22
|
|
SECTION 3.08
|
Purchase of Securities
|
22
|
|
SECTION 3.09
|
Mandatory and Optional Sinking Funds
|
22
|
|
SECTION 3.10
|
Satisfaction of Sinking Fund Payments with Securities
|
23
|
|
SECTION 3.11
|
Redemption of Securities for Sinking Fund
|
23
|
|
|
|
|
|
ARTICLE IV COVENANTS
|
24
|
|
|
|
|
SECTION 4.01
|
Payment of Securities
|
24
|
|
SECTION 4.02
|
Maintenance of Office or Agency
|
24
|
|
ii
|
|
|
|
|
SECTION 4.03
|
SEC Reports; Financial Statements
|
24
|
|
SECTION 4.04
|
Compliance Certificate
|
25
|
|
SECTION 4.05
|
Existence
|
26
|
|
SECTION 4.06
|
Waiver of Stay, Extension or Usury Laws
|
26
|
|
SECTION 4.07
|
Additional Amounts
|
26
|
|
|
|
|
|
ARTICLE V SUCCESSORS
|
26
|
|
|
|
|
SECTION 5.01
|
Limitations on Mergers and Consolidations
|
26
|
|
SECTION 5.02
|
Successor Person Substituted
|
27
|
|
|
|
|
|
ARTICLE VI DEFAULTS AND REMEDIES
|
27
|
|
|
|
|
|
SECTION 6.01
|
Events of Default
|
27
|
|
SECTION 6.02
|
Acceleration
|
29
|
|
SECTION 6.03
|
Other Remedies
|
30
|
|
SECTION 6.04
|
Waiver of Defaults
|
30
|
|
SECTION 6.05
|
Control by Majority
|
30
|
|
SECTION 6.06
|
Limitations on Suits
|
31
|
|
SECTION 6.07
|
Rights of Holders to Receive Payment
|
31
|
|
SECTION 6.08
|
Collection Suit by Trustee
|
31
|
|
SECTION 6.09
|
Trustee May File Proofs of Claim
|
32
|
|
SECTION 6.10
|
Priorities
|
32
|
|
SECTION 6.11
|
Undertaking for Costs
|
33
|
|
|
|
|
|
ARTICLE VII TRUSTEE
|
33
|
|
|
|
|
|
SECTION 7.01
|
Duties of Trustee
|
33
|
|
SECTION 7.02
|
Rights of Trustee
|
34
|
|
SECTION 7.03
|
May Hold Securities
|
35
|
|
SECTION 7.04
|
Trustee’s Disclaimer
|
35
|
|
SECTION 7.05
|
Notice of Defaults
|
36
|
|
SECTION 7.06
|
Reports by Trustee to Holders
|
36
|
|
SECTION 7.07
|
Compensation and Indemnity
|
36
|
|
SECTION 7.08
|
Replacement of Trustee
|
37
|
|
SECTION 7.09
|
Successor Trustee by Merger, etc.
|
39
|
|
SECTION 7.10
|
Eligibility; Disqualification
|
39
|
|
SECTION 7.11
|
Preferential Collection of Claims Against the Issuer or a Subsidiary Guarantor
|
39
|
|
|
|
|
|
ARTICLE VIII DISCHARGE OF INDENTURE
|
39
|
|
|
|
|
|
SECTION 8.01
|
Termination of the Issuer’s and the Subsidiary Guarantors’ Obligations
|
39
|
|
SECTION 8.02
|
Application of Trust Money
|
43
|
|
SECTION 8.03
|
Repayment to Issuer or Subsidiary Guarantor
|
44
|
|
SECTION 8.04
|
Reinstatement
|
44
|
|
|
|
|
|
ARTICLE IX SUPPLEMENTAL INDENTURES AND AMENDMENTS
|
44
|
|
|
|
|
SECTION 9.01
|
Without Consent of Holders
|
44
|
|
iii
|
|
|
|
|
SECTION 9.02
|
With Consent of Holders
|
45
|
|
SECTION 9.03
|
Compliance with the Trust Indenture Act
|
47
|
|
SECTION 9.04
|
Revocation and Effect of Consents
|
47
|
|
SECTION 9.05
|
Notation on or Exchange of Securities
|
48
|
|
SECTION 9.06
|
Trustee to Sign Amendments, etc.
|
48
|
|
|
|
|
|
ARTICLE X GUARANTEE
|
49
|
|
|
|
|
SECTION 10.01
|
Guarantee
|
49
|
|
SECTION 10.02
|
Execution and Delivery of Guarantees
|
51
|
|
SECTION 10.03
|
Limitation on Liability of the Subsidiary Guarantors
|
51
|
|
SECTION 10.04
|
Release of Subsidiary Guarantors from Guarantee
|
51
|
|
SECTION 10.05
|
Contribution
|
52
|
|
SECTION 10.06
|
Guarantee for Benefit of Holders
|
52
|
|
|
|
|
|
ARTICLE XI MISCELLANEOUS
|
53
|
|
|
|
|
SECTION 11.01
|
Trust Indenture Act Controls
|
53
|
|
SECTION 11.02
|
Notices
|
53
|
|
SECTION 11.03
|
Communication by Holders with Other Holders
|
54
|
|
SECTION 11.04
|
Certificate and Opinion as to Conditions Precedent
|
54
|
|
SECTION 11.05
|
Statements Required in Certificate or Opinion
|
55
|
|
SECTION 11.06
|
Rules by Trustee and Agents
|
55
|
|
SECTION 11.07
|
Legal Holidays
|
55
|
|
SECTION 11.08
|
No Recourse Against Others
|
55
|
|
SECTION 11.09
|
Governing Law
|
56
|
|
SECTION 11.10
|
No Adverse Interpretation of Other Agreements
|
56
|
|
SECTION 11.11
|
Successors
|
56
|
|
SECTION 11.12
|
Severability
|
56
|
|
SECTION 11.13
|
Counterpart Originals
|
56
|
|
SECTION 11.14
|
Table of Contents, Headings, etc.
|
56
|
|
SECTION 11.15
|
Waiver of Jury Trial
|
57
|
|
SECTION 11.16
|
Submission of Jurisdiction
|
57
|
|
SECTION 11.17
|
Force Majeure
|
57
|
|
iv
INDENTURE dated as of August 1, 2014 among EQT Midstream Partners, LP, a Delaware limited partnership (the “Issuer”), the Subsidiary Guarantors (as defined herein) party hereto and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”).
The Issuer and the Subsidiary Guarantors have duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of the Issuer’s debentures, notes, bonds or other evidences of indebtedness to be issued in one or more series unlimited as to principal amount (herein called the “Securities”), and the related Guarantees (as hereinafter defined), if any, as provided in this Indenture.
The Issuer and the Subsidiary Guarantors are members of the same consolidated group of companies. The Subsidiary Guarantors will derive direct and indirect economic benefit from the issuance of the Securities. Accordingly, each Subsidiary Guarantor has duly authorized the execution and delivery of this Indenture in light of the possibility that such Subsidiary Guarantor will provide its full and unconditional guarantee of a series of the Securities to the extent provided in this Indenture.
All things necessary to make this Indenture a valid agreement of the Issuer and the Subsidiary Guarantors, in accordance with its terms, have been done.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01
Definitions.
“Additional Amounts” means any additional amounts required by the express terms of a Security or by or pursuant to a Board Resolution, under circumstances specified therein or pursuant thereto, to be paid by the Issuer or any Subsidiary Guarantor, as the case may be, with respect to certain taxes, assessments or other governmental charges imposed on certain Holders and that are owing to such Holders.
“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such specified Person. For purposes of this definition, “control” of a Person shall mean the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” shall have meanings correlative to the foregoing.
“Agent” means any Registrar or Paying Agent.
“Bankruptcy Law” means Title 11 of the United States Code or any similar federal, state or foreign law for the relief of debtors.
“Board of Directors,” when used with reference to the Issuer or a Subsidiary Guarantor, means, (i) with respect to the Issuer, the Board of Directors of the General Partner or any authorized committee of the Board of Directors of the General Partner or any directors and/or officers of the General Partner to whom such Board of Directors or such committee shall have duly delegated its authority to act hereunder, and (ii) with respect to a Subsidiary
1
Guarantor, the board of directors or managers of such Subsidiary Guarantor, any authorized committee thereof and any directors, managers and/or officers thereof or of the General Partner, which may include the Board of Directors of the Issuer referred to in clause (i), in any case to whom such board of directors or managers or such committee shall have duly delegated its authority to act hereunder and, if such Subsidiary Guarantor is a limited partnership, the references to the Board of Directors shall mean the Board of Directors of the general partner of such Subsidiary Guarantor.
“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the General Partner to have been duly adopted by the Board of Directors of the Issuer and to be in full force and effect on the date of such certification, and delivered to the Trustee.
“Business Day” means any day that is not a Legal Holiday.
“Corporate Trust Office of the Trustee” means the office of the Trustee located at 525 William Penn Place, 38th Floor, Pittsburgh, Pennsylvania 15259, Attention: Corporate Trust Administration, and as may be located at such other address as the Trustee may give notice to the Issuer and the Subsidiary Guarantors.
“Credit Facility” means the Amended and Restated Credit Agreement, dated February 18, 2014, by and among the Issuer, the subsidiary guarantors party thereto, Wells Fargo Bank, National Association, as administrative agent, and a syndicate of lenders named therein, as amended, restated, refinanced, replaced or refunded from time to time.
“Default” means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default.
“deliver” or “delivery” means, in the context of certificated Securities, actual physical delivery of the certificated Securities to the relevant Person required hereunder, together with all endorsements, and in the context of Global Securities, the designation on the records of the Depositary of a change in the beneficial interests of a holder in a Global Security.
“Depositary” means, with respect to the Securities of any series issuable or issued in whole or in part in global form, the Person specified pursuant to Section 2.01 hereof as the initial Depositary with respect to the Securities of such series, until a successor shall have been appointed and become such pursuant to the applicable provision of this Indenture, and thereafter “Depositary” shall mean or include such successor.
“Dollar” or “$” means a dollar or other equivalent unit in such coin or currency of the United States as at the time shall be legal tender for the payment of public and private debt.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any successor statute.
“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial
2
Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect from time to time.
“General Partner” means EQT Midstream Services, LLC, a Delaware limited liability company, and its successors and permitted assigns as general partner of the Issuer or as the business entity with the ultimate authority to manage the business and operations of the Issuer.
“Global Security” means a Security that is issued in global form in the name of the Depositary with respect thereto or its nominee.
“Government Obligations” means, with respect to a series of Securities, direct obligations of the United States of America for the payment of which the full faith and credit of the United States of America is pledged, or obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America.
“Guarantee” means the guarantee of the Issuer’s obligations under the Securities of a series by a Subsidiary Guarantor (if but only if specified with respect to such series as contemplated by Section 2.01(9)) as provided in Article X.
“Holder” means a Person in whose name a Security is registered.
“Indenture” means this Indenture as amended or supplemented from time to time pursuant to the provisions hereof, and includes the terms of a particular series of Securities established as contemplated by Section 2.01.
“interest” means, with respect to an Original Issue Discount Security that by its terms bears interest only after Maturity, interest payable after Maturity.
“Interest Payment Date,” when used with respect to any Security, shall have the meaning assigned to such term in the Security as contemplated by Section 2.01.
“Issuer” means the Person named as the “Issuer” in the first paragraph of this instrument until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Issuer” shall mean such successor Person;
provided,
however, that for purposes of any provision contained herein which is required by the TIA, “Issuer” shall also mean each other obligor (if any), other than a Subsidiary Guarantor, on the Securities of a series.
“Issuer Order” means a written request or order signed on behalf of the Issuer by two of its Officers and delivered to the Trustee.
“Legal Holiday” means a Saturday, a Sunday or a day on which banking institutions in any of The City of New York, New York or a Place of Payment are authorized or obligated by law, regulation or executive order to remain closed.
3
“Maturity” means, with respect to any Security, the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity thereof, or by declaration of acceleration, call for redemption or otherwise.
“Officer” means the Chief Executive Officer, the President, the Chief Financial Officer, any Executive Vice President, any Senior Vice President, any Vice President, the Treasurer, any Assistant Treasurer, the Controller, the Secretary or any Assistant Secretary of a Person, including, with respect to the Issuer or a Subsidiary Guarantor, any such officer of the General Partner that the Board of Directors of the Issuer or such Subsidiary Guarantor shall have duly authorized to act hereunder.
“Officers’ Certificate” means a certificate signed on behalf of the Issuer by any two of its Officers.
“Opinion of Counsel” means a written opinion acceptable to the Trustee from legal counsel. Such counsel may be an employee of or counsel to the Issuer, the General Partner, a Subsidiary Guarantor or an Affiliate of any of the foregoing.
“Original Issue Discount Security” means any Security that provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 6.02.
“Person” means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or other agency, instrumentality or political subdivision thereof or other entity of any kind.
“Place of Payment” means, with respect to the Securities of any series, the place or places where the principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities of that series are payable as specified in accordance with Section 2.01 subject to the provisions of Section 4.02.
“principal” of a Security means the principal of the Security plus, when appropriate, the premium, if any, on the Security.
“Redemption Date” means, with respect to any Security to be redeemed, the date fixed for such redemption by or pursuant to this Indenture.
“Redemption Price” means, with respect to any Security to be redeemed, the price at which it is to be redeemed pursuant to this Indenture.
“Responsible Officer” means any officer within the corporate trust department of the Trustee having direct responsibility for the administration of this Indenture or any other officer to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.
4
“Rule 144A Securities” means Securities of a series designated pursuant to Section 2.01 as entitled to the benefits of Section 4.03(b).
“SEC” means the Securities and Exchange Commission.
“Securities” has the meaning stated in the preamble of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture.
“Security Custodian” means, with respect to Securities of a series issued in global form, the Trustee for Securities of such series, as custodian with respect to the Securities of such series, or any successor entity thereto.
“Significant Subsidiary” means a Subsidiary of the Issuer that is a “significant subsidiary” of the Issuer as such term is defined in Rule 1-02(w) of Regulation S-X as in effect on the date hereof.
“Stated Maturity” means, when used with respect to any Security or any installment of principal thereof or interest thereon, the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.
“Subsidiary” of any Person means:
(1)
any corporation, association or other business entity of which more than 50% of the total voting power of equity interests entitled, without regard to the occurrence of any contingency, to vote in the election of directors, managers, trustees or equivalent Persons thereof is at the time of determination owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or any combination thereof; or
(2)
in the case of a partnership, more than 50% of the partners’ equity interests, considering all partners’ equity interests as a single class, is at such time of determination owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or any combination thereof.
“Subsidiary Guarantors” means, with respect to any series of Securities, the Subsidiaries of the Issuer party hereto and the other Person or Persons that have executed a supplemental indenture pursuant to Section 10.02, if any, in each case named in accordance with Section 2.01(9) as the “Subsidiary Guarantors” (i) in or pursuant to a Board Resolution, and set forth, or determined in the manner provided, in an Officers’ Certificate or in an Issuer Order, or (ii) in a supplemental indenture establishing the terms of such series of Securities, and any other Subsidiary of the Issuer who may execute this Indenture, or a supplement thereto, for the purpose of providing a Guarantee for such series of Securities pursuant to this Indenture, in each case, until a successor Person or Persons shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Subsidiary Guarantors” with respect to such series of Securities shall mean such successor Person or Persons. If a series of Securities does not have any
5
Subsidiary Guarantors as contemplated by Section 2.01(9), all references in this Indenture to Subsidiary Guarantors shall be ignored with respect to such series of Securities. For the avoidance of doubt, no Security of any series shall be entitled to the benefits of any Guarantee of any Subsidiary Guarantor unless so specified in accordance with Section 2.01(9).
“surrender” shall have the same meaning as “deliver” in the context of the surrender of a Security.
“TIA” means the Trust Indenture Act of 1939, as amended, as in effect on the date hereof;
provided, however,
that, in the event the Trust Indenture Act of 1939 is amended after such date, “TIA” means, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended.
“Trustee” means the Person named as such above until a successor replaces it in accordance with the applicable provisions of this Indenture, and thereafter “Trustee” means each Person who is then a Trustee hereunder, and if at any time there is more than one such Person, “Trustee” as used with respect to the Securities of any series means the Trustee with respect to Securities of that series.
“United States” means the United States of America (including the States and the District of Columbia) and its territories and possessions, which include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands.
SECTION 1.02
Other Definitions.
|
|
|
Term
|
Defined
in Section
|
“Agent Members”
“Bankruptcy Custodian”
“covenant defeasance”
“Event of Default”
“Funding Guarantor”
“Judgment Currency”
“legal defeasance”
“mandatory sinking fund payment”
“Notation of Guarantee”
“optional sinking fund payment”
“Paying Agent”
“Registrar”
“Required Currency”
“Successor”
|
2.17
6.01
8.01
6.01
10.05
6.10
8.01
3.09
10.02
3.09
2.05
2.05
6.10
5.01
|
SECTION 1.03
Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture (and if the Indenture is not
6
qualified under the TIA at that time, as if it were so qualified unless otherwise provided). The following TIA terms used in this Indenture have the following meanings:
“Commission” means the SEC.
“indenture securities” means the Securities.
“indenture security holder” means a Holder.
“indenture to be qualified” means this Indenture.
“indenture trustee” or “institutional trustee” means the Trustee.
“obligor” on the indenture securities means the Issuer, any Subsidiary Guarantor or any other obligor on the Securities.
All terms used in this Indenture that are defined by the TIA, defined by a TIA reference to another statute or defined by an SEC rule under the TIA have the meanings so assigned to them.
SECTION 1.04
Rules of Construction.
Unless the context otherwise requires:
(1)
a term has the meaning assigned to it;
(2)
an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;
(3)
“or” is not exclusive;
(4)
words in the singular include the plural, and in the plural include the singular;
(5)
provisions apply to successive events and transactions; and
(6)
all references in this instrument to Articles and Sections are references to the corresponding Articles and Sections in and of this instrument.
ARTICLE II
THE SECURITIES
SECTION 2.01
Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited.
7
The Securities may be issued in one or more series. There shall be established in or pursuant to a Board Resolution, and set forth, or determined in the manner provided, in an Officers’ Certificate or in an Issuer Order, or established in one or more supplemental indentures, prior to the issuance of Securities of any series:
(1)
the title of the Securities of the series (which shall distinguish the Securities of the series from the Securities of all other series);
(2)
if there is to be a limit, the limit upon the aggregate principal amount of the Securities of the series that may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 2.08, 2.09, 2.12, 2.17, 3.07 or 9.05 and except for any Securities which, pursuant to Section 2.04 or 2.17, are deemed never to have been authenticated and delivered hereunder);
provided, however,
that unless otherwise provided in the terms of the series, the authorized aggregate principal amount of such series may be increased before or after the issuance of any Securities of the series by a Board Resolution (or action pursuant to a Board Resolution) to such effect;
(3)
whether any Securities of the series are to be issuable initially in temporary global form and whether any Securities of the series are to be issuable in permanent global form, as Global Securities or otherwise, and, if so, whether beneficial owners of interests in any such Global Security may exchange such interests for Securities of such series and of like tenor of any authorized form and denomination and the circumstances under which any such exchanges may occur, if other than in the manner provided in Section 2.17, and the initial Depositary and Security Custodian, if any, for any Global Security or Securities of such series;
(4)
the manner in which any interest payable on a temporary Global Security on any Interest Payment Date will be paid if other than in the manner provided in Section 2.14;
(5)
the date or dates on which the principal of and premium (if any) on the Securities of the series is payable or the method of determination thereof;
(6)
the rate or rates, or the method of determination thereof, at which the Securities of the series shall bear interest, if any, whether and under what circumstances Additional Amounts with respect to such Securities shall be payable, the date or dates from which such interest shall accrue, the Interest Payment Dates on which such interest shall be payable and the record date for the interest payable on any Securities on any Interest Payment Date, or if other than provided herein, the Person to whom any interest on Securities of the series shall be payable;
(7)
the place or places where, subject to the provisions of Section 4.02, the principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities of the series shall be payable;
8
(8)
the period or periods within which, the price or prices (whether denominated in cash, securities or otherwise) at which and the terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Issuer, if the Issuer is to have that option, and the manner in which the Issuer must exercise any such option, if different from those set forth herein;
(9)
whether Securities of the series are entitled to the benefits of any Guarantee of any Subsidiary Guarantor pursuant to this Indenture, the identity of any such Subsidiary Guarantors (which may, but is not required to, include each of the Subsidiaries of the Issuer a party hereto) and any terms of such Guarantee with respect to the Securities of the series in addition to those set forth in Article X, or any exceptions to or changes to those set forth in Article X;
(10)
the obligation, if any, of the Issuer to redeem, purchase or repay Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices (whether denominated in cash, securities or otherwise) at which and the terms and conditions upon which Securities of the series shall be redeemed, purchased or repaid in whole or in part pursuant to such obligation;
(11)
if other than denominations of $2,000 and any integral multiple of $1,000 in excess thereof, the denomination in which any Securities of that series shall be issuable;
(12)
if other than Dollars, the form, including equity securities, other debt securities (including Securities), warrants or any other securities or property of the Issuer, any Subsidiary Guarantor or any other Person, in which payment of the principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities of the series shall be payable;
(13)
if the amount of payments of principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities of the series may be determined with reference to any commodities, currencies or indices, values, rates or prices or any other index or formula, the manner in which such amounts shall be determined;
(14)
if other than the entire principal amount thereof, the portion of the principal amount of Securities of the series that shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 6.02;
(15)
any additional means of satisfaction and discharge of this Indenture and any additional conditions or limitations to discharge with respect to Securities of the series and the related Guarantees, if any, pursuant to Article VIII or any modifications of or deletions from such conditions or limitations;
(16)
any deletions or modifications of or additions to the Events of Default set forth in Section 6.01 or covenants of the Issuer or any Subsidiary Guarantor set forth in Article IV pertaining to the Securities of the series;
9
(17)
any restrictions or other provisions with respect to the transfer or exchange of Securities of the series, which may amend, supplement, modify or supersede those contained in this Article II;
(18)
if the Securities of the series are to be convertible into or exchangeable for common units, other debt securities (including Securities), warrants, other equity securities or any other securities or property of the Issuer, any Subsidiary Guarantor or any other Person, at the option of the Issuer or the Holder or upon the occurrence of any condition or event, the terms and conditions for such conversion or exchange;
(19)
whether the Securities of the series are to be entitled to the benefit of Section 4.03(b) (and accordingly constitute Rule 144A Securities); and
(20)
any other terms of the series (which terms shall not be prohibited by the provisions of this Indenture).
All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and (subject to Section 2.03) set forth, or determined in the manner provided, in the Officers’ Certificate or Issuer Order referred to above or in any such supplemental indenture.
If any of the terms of the series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action, together with such Board Resolution, shall be set forth in an Officers’ Certificate or certified by the Secretary or an Assistant Secretary of the General Partner and delivered to the Trustee at or prior to the delivery of the Officers’ Certificate or Issuer Order setting forth the terms of the series.
SECTION 2.02
Denominations.
The Securities of each series shall be issuable in such denominations as shall be specified as contemplated by Section 2.01. In the absence of any such provisions with respect to the Securities of any series, the Securities of such series denominated in Dollars shall be issuable in denominations of $2,000 and any integral multiples of $1,000 in excess thereof.
SECTION 2.03
Forms Generally.
The Securities of each series shall be in fully registered form and in substantially such form or forms (including temporary or permanent global form) established by or pursuant to a Board Resolution or in one or more supplemental indentures. The Securities may have notations, legends or endorsements required by law, securities exchange rule, the Issuer’s certificate of limited partnership, agreement of limited partnership or other similar governing documents, agreements to which the Issuer is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Issuer). A copy of the Board Resolution establishing the form or forms of Securities of any series shall be delivered to the Trustee at or prior to the delivery of the Issuer Order contemplated by Section 2.04 for the authentication and delivery of such Securities.
10
The definitive Securities of each series shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the Officers executing such Securities, as evidenced by their execution thereof.
The Trustee’s certificate of authentication shall be in substantially the following form:
“This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.
|
|
|
|
|
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
|
|
|
|
By:
|
|
|
Authorized Officer
|
|
|
|
Dated:”.
|
SECTION 2.04
Execution, Authentication, Delivery and Dating.
Two Officers of the Issuer shall sign the Securities on behalf of the Issuer and, with respect to any related Guarantees, an Officer of each Subsidiary Guarantor shall sign the Notation of Guarantee on behalf of such Subsidiary Guarantor, in each case by manual or facsimile signature.
If an Officer of the Issuer or a Subsidiary Guarantor whose signature is on a Security no longer holds that office at the time the Security is authenticated, the Security shall be valid nevertheless.
A Security shall not be entitled to any benefit under this Indenture or the related Guarantees, if any, or be valid or obligatory for any purpose until authenticated by the manual signature of an authorized signatory of the Trustee, which signature shall be conclusive evidence that the Security has been authenticated under this Indenture. Notwithstanding the foregoing, if any Security has been authenticated and delivered hereunder but never issued and sold by the Issuer, and the Issuer delivers such Security to the Trustee for cancellation as provided in Section 2.13, together with a written statement (which need not comply with Section 11.05 and need not be accompanied by an Opinion of Counsel) stating that such Security has never been issued and sold by the Issuer, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture or the related Guarantees, if any.
At any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Securities of any series executed by the Issuer (with, if applicable, the Notation of Guarantee for such series executed by each Subsidiary Guarantor thereof) to the Trustee for authentication, and the Trustee shall authenticate and deliver such Securities for original issue upon an Issuer Order for the authentication and delivery of such Securities or pursuant to such procedures acceptable to the Trustee as may be specified from time to time by Issuer Order. Such order shall specify the amount of the Securities to be
11
authenticated, the date on which the original issue of Securities is to be authenticated, the name or names of the initial Holder or Holders and any other terms of the Securities of such series not otherwise determined. If provided for in such procedures, such Issuer Order may authorize (1) authentication and delivery of Securities of such series for original issue from time to time, with certain terms (including, without limitation, the Maturity date or dates, original issue date or dates and interest rate or rates) that differ from Security to Security and (2) authentication and delivery pursuant to electronic instructions from the Issuer or its duly authorized agent, which instructions shall be promptly confirmed in writing.
If the form or terms of the Securities of the series have been established in or pursuant to one or more Board Resolutions as permitted by Section 2.01, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be provided with (in addition to the Issuer Order referred to above and the other documents required by Section 11.04), and (subject to Section 7.01) shall be fully protected in relying upon:
(a)
an Officers’ Certificate setting forth the Board Resolution and, if applicable, an appropriate record of any action taken pursuant thereto, as contemplated by the last paragraph of Section 2.01; and
(b)
an Opinion of Counsel to the effect that:
(i)
the form of such Securities has been established in conformity with the provisions of this Indenture;
(ii)
the terms of such Securities have been established in conformity with the provisions of this Indenture; and
(iii)
that when authenticated and delivered by the Trustee and issued by the Issuer in the manner and subject to any conditions specified in such Opinion of Counsel, such Securities and the related Guarantees, if any, will constitute valid and binding obligations of the Issuer and the Subsidiary Guarantors, respectively, enforceable against the Issuer and the Subsidiary Guarantors, respectively, in accordance with their respective terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or transfer or other similar laws in effect from time to time affecting the rights of creditors generally, and the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
If all the Securities of any series are not to be issued at one time, it shall not be necessary to deliver such Officers’ Certificate and Opinion of Counsel at the time of issuance of each such Security, but such Officers’ Certificate and Opinion of Counsel shall be delivered at or before the time of issuance of the first Security of the series to be issued.
The Trustee shall not be required to authenticate such Securities if the issuance of such Securities pursuant to this Indenture would affect the Trustee’s own rights, duties or
12
immunities under the Securities and this Indenture or otherwise in a manner not reasonably acceptable to the Trustee.
The Trustee may appoint an authenticating agent acceptable to the Issuer to authenticate Securities. Unless limited by the terms of such appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Issuer, any Subsidiary Guarantor or an Affiliate of the Issuer or any Subsidiary Guarantor.
Each Security shall be dated the date of its authentication.
SECTION 2.05
Registrar and Paying Agent.
The Issuer shall maintain an office or agency for each series of Securities where Securities of such series may be presented for registration of transfer or exchange (“Registrar”) and an office or agency where Securities of such series may be presented for payment (“Paying Agent”). The Registrar shall keep a register of the Securities of such series and of their transfer and exchange. The Issuer may appoint one or more co-registrars and one or more additional paying agents. The term “Registrar” includes any co-registrar and the term “Paying Agent” includes any additional paying agent.
The Issuer shall enter into an appropriate agency agreement with any Registrar or Paying Agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Issuer shall notify the Trustee of the name and address of any Agent not a party to this Indenture. The Issuer may change any Paying Agent or Registrar without notice to any Holder. If the Issuer fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Issuer, any Subsidiary Guarantor or any other Subsidiary of the Issuer may act as Paying Agent or Registrar.
The Issuer initially appoints the Trustee as Registrar and Paying Agent.
SECTION 2.06
Paying Agent to Hold Money in Trust.
The Issuer shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal of, premium, if any, or interest on or any Additional Amounts with respect to Securities and will notify the Trustee of any default by the Issuer in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed. The Issuer at any time may require a Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed. Upon payment over to the Trustee and upon accounting for any funds disbursed, the Paying Agent (if other than the Issuer, a Subsidiary Guarantor or another Subsidiary of the Issuer) shall have no further liability for the money. If the Issuer, a Subsidiary Guarantor or another Subsidiary of the Issuer acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Each Paying Agent shall otherwise comply with TIA § 317(b).
13
SECTION 2.07
Holder Lists.
The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders and shall otherwise comply with TIA § 312(a). If the Trustee is not the Registrar with respect to a series of Securities, the Issuer shall furnish to the Trustee at least five Business Days before each Interest Payment Date with respect to such series of Securities, and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders of such series, and the Issuer shall otherwise comply with TIA § 312(a).
SECTION 2.08
Transfer and Exchange.
Except as set forth in Section 2.17 or as may be provided pursuant to Section 2.01:
When Securities of any series are presented to the Registrar with the request to register the transfer of such Securities or to exchange such Securities for an equal principal amount of Securities of the same series of like tenor and of other authorized denominations, the Registrar shall register the transfer or make the exchange as requested if its requirements and the requirements of this Indenture for such transactions are met;
provided, however
, that the Securities presented or surrendered for registration of transfer or exchange shall be duly endorsed or accompanied by a written instruction of transfer in form reasonably satisfactory to the Registrar duly executed by the Holder thereof or by his attorney, duly authorized in writing, on which instruction the Registrar can rely.
To permit registrations of transfers and exchanges, the Issuer shall execute Securities (with, if applicable, the Notation of Guarantee for such series executed by each Subsidiary Guarantor thereof) and the Trustee shall authenticate such Securities at the Registrar’s written request and submission of the Securities or Global Securities. No service charge shall be made to a Holder for any registration of transfer or exchange (except as otherwise expressly permitted herein), but the Issuer may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than such transfer tax or similar governmental charge payable upon exchanges pursuant to Section 2.12, 3.07 or 9.05). The Trustee shall authenticate Securities in accordance with the provisions of Section 2.04. Notwithstanding any other provisions of this Indenture to the contrary, the Issuer shall not be required to register the transfer or exchange of (a) any Security selected for redemption in whole or in part pursuant to Article III, except the unredeemed portion of any Security being redeemed in part, or (b) any Security during the period beginning 15 Business Days prior to the giving of notice of any offer to repurchase Securities of the series required pursuant to the terms thereof or of redemption of Securities of a series to be redeemed and ending at the close of business on the day of transmission.
SECTION 2.09
Replacement Securities.
If any mutilated Security is surrendered to the Trustee, or if the Holder of a Security claims that the Security has been destroyed, lost or stolen and the Issuer and the Trustee
14
receive evidence to their satisfaction of the destruction, loss or theft of such Security, the Issuer shall issue, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to, and the Trustee shall authenticate a replacement Security of the same series if the Trustee’s requirements are met. If any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Issuer in its discretion may, instead of issuing a new Security, pay such Security. If required by the Trustee, any Subsidiary Guarantor or the Issuer, such Holder must furnish an indemnity bond that is sufficient in the judgment of the Trustee and the Issuer to protect the Issuer, any Subsidiary Guarantor, the Trustee, any Agent or any authenticating agent from any loss that any of them may suffer if a Security is replaced. The Issuer and the Trustee may charge a Holder for their expenses in replacing a Security.
Every replacement Security is an additional obligation of the Issuer.
SECTION 2.10
Outstanding Securities.
The Securities outstanding at any time are all the Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest in a Global Security effected by the Trustee hereunder and those described in this Section 2.10 as not outstanding.
If a Security is replaced pursuant to Section 2.09, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Security is held by a protected purchaser.
If the principal amount of any Security is considered paid under Section 4.01, it ceases to be outstanding and interest on it ceases to accrue.
Except to the extent provided in Section 2.11, a Security does not cease to be outstanding because the Issuer, a Subsidiary Guarantor or an Affiliate of the Issuer or a Subsidiary Guarantor holds the Security.
SECTION 2.11
Original Issue Discount and Treasury Securities.
In determining whether the Holders of the required principal amount of Securities have concurred in any direction, amendment, supplement, waiver or consent, (a) the principal amount of an Original Issue Discount Security shall be the principal amount thereof that would be due and payable as of the date of such determination upon acceleration of the Maturity thereof pursuant to Section 6.02 and (b) Securities owned by the Issuer, a Subsidiary Guarantor or any other obligor upon the Securities or any Affiliate of the Issuer, of a Subsidiary Guarantor or of such other obligor shall be disregarded, except that, for the purpose of determining whether the Trustee shall be protected in relying upon any such direction, amendment, supplement, waiver or consent, only Securities that a Responsible Officer of the Trustee actually knows are so owned shall be so disregarded.
15
SECTION 2.12
Temporary Securities.
Until definitive Securities of any series are ready for delivery, the Issuer may prepare and execute, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to, and the Trustee shall authenticate temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities, but may have variations that the Issuer considers appropriate for temporary Securities. Without unreasonable delay, the Issuer shall prepare and execute, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to, and the Trustee shall authenticate definitive Securities in exchange for temporary Securities. Until so exchanged, the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as definitive Securities.
SECTION 2.13
Cancellation.
The Issuer or any Subsidiary Guarantor at any time may deliver Securities to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange, payment or redemption or for credit against any sinking fund payment. The Trustee shall cancel all Securities surrendered for registration of transfer, exchange, payment, redemption, replacement or cancellation or for credit against any sinking fund. Unless the Issuer shall direct in writing that canceled Securities be returned to it, after written notice to the Issuer all canceled Securities held by the Trustee shall be disposed of in accordance with the usual disposal procedures of the Trustee, and the Trustee shall maintain a record of their disposal. The Issuer may not issue new Securities to replace Securities that have been paid or that have been delivered to the Trustee for cancellation.
SECTION 2.14
Payments; Defaulted Interest.
Unless otherwise provided as contemplated by Section 2.01, interest (except defaulted interest) on any Security that is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Persons who are registered Holders of that Security at the close of business on the record date next preceding such Interest Payment Date, even if such Securities are canceled after such record date and on or before such Interest Payment Date. The Holder must surrender a Security to a Paying Agent to collect principal payments. Unless otherwise provided with respect to the Securities of any series, the Issuer will pay the principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities in Dollars. Such amounts shall be payable at the offices of the Trustee or any Paying Agent,
provided
that at the option of the Issuer, the Issuer may pay such amounts (1) by wire transfer with respect to Global Securities or (2) by check payable in such money mailed to a Holder’s registered address with respect to any Securities.
If the Issuer defaults in a payment of interest on the Securities of any series, the Issuer shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest on the defaulted interest, in each case at the rate provided in the Securities of such series and in Section 4.01. The Issuer may pay the defaulted interest to the Persons who are Holders on a subsequent special record date. At least 15 days before any special record date selected by the Issuer, the Issuer (or the Trustee, in the name of and at the expense of the Issuer upon 20 days’
16
prior written notice from the Issuer setting forth such special record date and the interest amount to be paid) shall transmit to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid.
SECTION 2.15
Persons Deemed Owners.
The Issuer, any Subsidiary Guarantors, the Trustee, any Agent and any authenticating agent may treat the Person in whose name any Security is registered as the owner of such Security for the purpose of receiving payments of principal of, premium (if any) or interest on or any Additional Amounts with respect to such Security and for all other purposes. None of the Issuer, any Subsidiary Guarantor, the Trustee, any Agent or any authenticating agent shall be affected by any notice to the contrary.
SECTION 2.16
Computation of Interest.
Except as otherwise specified as contemplated by Section 2.01 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a year comprising twelve 30-day months.
SECTION 2.17
Global Securities; Book-Entry Provisions.
If Securities of a series are issuable in global form as a Global Security, as contemplated by Section 2.01, then, notwithstanding clause (11) of Section 2.01 and the provisions of Section 2.02, any such Global Security shall represent such of the outstanding Securities of such series as shall be specified therein and may provide that it shall represent the aggregate amount of outstanding Securities from time to time endorsed thereon and that the aggregate amount of outstanding Securities represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges, transfers or redemptions. Any endorsement of a Global Security to reflect the amount, or any increase or decrease in the amount, of outstanding Securities represented thereby shall be made by the Trustee (i) in such manner and upon instructions given by such Person or Persons as shall be specified in such Security or in an Issuer Order to be delivered to the Trustee pursuant to Section 2.04 or (ii) otherwise in accordance with written instructions or such other written form of instructions as is customary for the Depositary for such Security, from such Depositary or its nominee on behalf of any Person having a beneficial interest in such Global Security. Subject to the provisions of Section 2.04 and, if applicable, Section 2.12, the Trustee shall deliver and redeliver any Security in permanent global form in the manner and upon instructions given by the Person or Persons specified in such Security or in the applicable Issuer Order. With respect to the Securities of any series that are represented by a Global Security, the Issuer and the Subsidiary Guarantors authorize the execution and delivery by the Trustee of a letter of representations or other similar agreement or instrument in the form customarily provided for by the Depositary appointed with respect to such Global Security. Any Global Security may be deposited with the Depositary or its nominee, or may remain in the custody of the Trustee or the Security Custodian therefor pursuant to a FAST balance certificate agreement or similar agreement between the Trustee and the Depositary. If an Issuer Order has been, or simultaneously is, delivered, any instructions by the Issuer with respect to endorsement or delivery or redelivery of a Security in global form shall
17
be in writing but need not comply with Section 11.05 and need not be accompanied by an Opinion of Counsel.
Members of, or participants in, the Depositary (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary, or the Trustee or the Security Custodian as its custodian, or under such Global Security, and the Depositary may be treated by the Issuer, any Subsidiary Guarantor, the Trustee or the Security Custodian and any agent of the Issuer, any Subsidiary Guarantor, the Trustee or the Security Custodian as the absolute owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, (i) the registered holder of a Global Security of a series may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action that a Holder of Securities of such series is entitled to take under this Indenture or the Securities of such series and (ii) nothing herein shall prevent the Issuer, any Subsidiary Guarantor, the Trustee or the Security Custodian, or any agent of the Issuer, any Subsidiary Guarantor, the Trustee or the Security Custodian, from giving effect to any written certification, proxy or other authorization furnished by the Depositary or shall impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a beneficial owner of any Security.
Notwithstanding Section 2.08, and except as otherwise provided pursuant to Section 2.01, transfers of a Global Security shall be limited to transfers of such Global Security in whole, but not in part, to the Depositary, its successors or their respective nominees; interests of beneficial owners in a Global Security may be transferred in accordance with the rules and procedures of the Depositary; and Securities shall be transferred to all beneficial owners in exchange for their beneficial interests in a Global Security if, and only if, either (1) the Depositary notifies the Issuer that it is unwilling or unable to continue as Depositary for the Global Security and a successor Depositary is not appointed by the Issuer within 90 days of such notice, (2) an Event of Default has occurred with respect to such series and is continuing and the Registrar has received a request from the Depositary to issue Securities in lieu of all or a portion of the Global Security (in which case the Issuer shall deliver Securities within 30 days of such request) or (3) the Issuer in its sole discretion determines not to have the Securities represented by a Global Security.
In connection with any transfer of a portion of the beneficial interests in a Global Security to beneficial owners pursuant to this Section 2.17, the Registrar shall reflect on its books and records the date and a decrease in the principal amount of the Global Security in an amount equal to the principal amount of the beneficial interests in the Global Security to be transferred, and the Issuer shall execute, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to, and the Trustee upon receipt of an Issuer Order for the authentication and delivery of Securities shall authenticate and deliver, one or more Securities of the same series of like tenor and amount.
In connection with the transfer of all of the beneficial interests in a Global Security to beneficial owners pursuant to this Section 2.17, the Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Issuer shall execute, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to,
18
and the Trustee shall authenticate and deliver, to each beneficial owner identified by the Depositary in exchange for its beneficial interests in the Global Security, an equal aggregate principal amount of Securities of authorized denominations.
None of the Issuer, any Subsidiary Guarantor or the Trustee will have any responsibility or liability for any aspect of the records relating to, or payments made on account of, Securities by the Depositary, or for maintaining, supervising or reviewing any records of the Depositary relating to such Securities. None of the Issuer, any Subsidiary Guarantor or the Trustee shall be liable for any delay by the Holder of the Global Security or the Depositary in identifying the beneficial owners, and each such Person may conclusively rely on, and shall be protected in relying on, instructions from such Holder of the Global Security or the Depositary for all purposes (including with respect to the registration and delivery, and the respective principal amounts, of the Securities to be issued).
The provisions of the last sentence of the third paragraph of Section 2.04 shall apply to any Global Security if such Global Security was never issued and sold by the Issuer and the Issuer or a Subsidiary Guarantor delivers to the Trustee the Global Security together with written instructions (which need not comply with Section 11.05 and need not be accompanied by an Opinion of Counsel) with regard to the cancellation or reduction in the principal amount of Securities represented thereby, together with the written statement contemplated by the last sentence of the third paragraph of Section 2.04.
Notwithstanding the provisions of Sections 2.03 and 2.14, unless otherwise specified as contemplated by Section 2.01, payment of principal of, premium (if any) and interest on and any Additional Amounts with respect to any Global Security shall be made to the Depositary.
The Issuer in issuing Securities of any series may use CUSIP numbers (if then generally in use), and, if so, the Trustee shall use CUSIP numbers in notices of redemption as a convenience to Holders of Securities of such series;
provided
that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities of such series or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities of such series, and any such redemption shall not be affected by any defect in or omission of such numbers. The Issuer will promptly notify the Trustee in writing of any change in the CUSIP numbers.
Notwithstanding anything herein to the contrary, delivery or surrender of a Security shall not be required in the case of Global Securities in order to obtain the rights or benefits provided hereunder upon the delivery or surrender of a Security.
ARTICLE III
REDEMPTION
SECTION 3.01
Applicability of Article.
Securities of any series that are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 2.01 for Securities of any series) in accordance with this Article III.
19
SECTION 3.02
Notice to the Trustee.
If the Issuer elects to redeem Securities of any series pursuant to this Indenture, it shall notify the Trustee of the Redemption Date and the principal amount of Securities of such series to be redeemed. The Issuer shall so notify the Trustee at least 45 days before the Redemption Date (unless a shorter notice shall be satisfactory to the Trustee) by delivering to the Trustee an Officers’ Certificate stating that such redemption will comply with the provisions of this Indenture and of the Securities of such series. Any such notice may be canceled at any time prior to the giving of such notice of such redemption to any Holder and shall thereupon be void and of no effect.
SECTION 3.03
Selection of Securities To Be Redeemed.
If less than all of the Securities of any series are to be redeemed (unless all of the Securities of such series of a specified tenor are to be redeemed), the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date from the outstanding Securities of such series (and tenor) not previously called for redemption, either pro rata, by lot or by such other method as the Trustee shall deem appropriate in accordance with industry standards at the time of such redemption and that may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series or of the principal amount of Global Securities of such series;
provided
that, if at the time of redemption such Securities are registered as a Global Security, the Depositary shall determine, in accordance with its procedures, the principal amount of such Securities held by each beneficial owner of Securities to be redeemed.
If the Trustee selects the Securities to be redeemed, the Trustee shall promptly notify the Issuer and the Registrar in writing of the Securities selected for redemption and, in the case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.
For purposes of this Indenture, unless the context otherwise requires, all provisions relating to redemption of Securities shall relate, in the case of any of the Securities redeemed or to be redeemed only in part, to the portion of the principal amount thereof which has been or is to be redeemed.
SECTION 3.04
Notice of Redemption.
Notice of redemption shall be transmitted not less than 30 days (or not less than 15 days in the case of convertible Securities) nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed, in accordance with Section 11.02.
All notices of redemption shall identify the Securities to be redeemed and shall state:
(1)
the Redemption Date;
20
(2)
the Redemption Price (or the method of calculating or determining the Redemption Price);
(3)
that, unless the Issuer and the Subsidiary Guarantors, if any, default in making the redemption payment, interest on Securities called for redemption ceases to accrue on and after the Redemption Date, and the only remaining right of the Holders of such Securities is to receive payment of the Redemption Price upon surrender to the Paying Agent of the Securities redeemed;
(4)
if any Security is to be redeemed in part, the portion of the principal amount thereof to be redeemed and that on and after the Redemption Date, upon surrender for cancellation of such Security to the Paying Agent, a new Security or Securities in the aggregate principal amount equal to the unredeemed portion thereof will be issued without charge to the Holder;
(5)
that Securities called for redemption must be surrendered to the Paying Agent to collect the Redemption Price and the name and address of the Paying Agent;
(6)
that the redemption is for a sinking or analogous fund, if such is the case;
(7)
if such Securities are convertible into or exchangeable for common units, other debt securities (including Securities), warrants, other equity securities or any other securities or property of the Issuer, any Subsidiary Guarantor or any other Person, the name and address of the conversion or exchange agent, the date on which the right to convert or exchange is terminated and the conversion or exchange rate; and
(8)
the CUSIP number, if any, relating to such Securities.
Notice of redemption of Securities to be redeemed at the election of the Issuer shall be given by the Issuer or, at the Issuer’s written request, by the Trustee in the name and at the expense of the Issuer;
provided
that, in the latter case, the Issuer shall give the Trustee at least five days’ prior notice of the date the Issuer wishes the notice of redemption to be given (unless a shorter notice period shall be satisfactory to the Trustee).
SECTION 3.05
Effect of Notice of Redemption.
Once notice of redemption is mailed, Securities called for redemption become due and payable on the Redemption Date and at the Redemption Price. Upon surrender to the Paying Agent, such Securities called for redemption shall be paid at the Redemption Price, but interest installments whose maturity is on or prior to such Redemption Date will be payable on the relevant Interest Payment Dates to the Holders of record at the close of business on the relevant record dates specified pursuant to Section 2.01.
SECTION 3.06
Deposit of Redemption Price.
By 11:00 a.m., New York City time, on any Redemption Date, the Issuer or a Subsidiary Guarantor shall deposit with the Trustee or the Paying Agent (or, if either of the Issuer or such Subsidiary Guarantor is acting as the Paying Agent, segregate and hold in trust as
21
provided in Section 2.06) an amount of money in same day funds sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on and any Additional Amounts with respect to, the Securities or portions thereof which are to be redeemed on that date, other than Securities or portions thereof called for redemption on that date which have been delivered by the Issuer or a Subsidiary Guarantor to the Trustee for cancellation.
If the Issuer or a Subsidiary Guarantor complies with the preceding paragraph, then, unless the Issuer and the Subsidiary Guarantors default in the payment of such Redemption Price, interest on the Securities to be redeemed will cease to accrue on and after the applicable Redemption Date, whether or not such Securities are presented for payment, and the Holders of such Securities shall have no further rights with respect to such Securities except for the right to receive the Redemption Price, together with any such accrued interest and Additional Amounts, upon surrender of such Securities. If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal, premium, if any, any Additional Amounts, and, to the extent lawful, accrued interest thereon shall, until paid, bear interest from the Redemption Date at the rate specified pursuant to Section 2.01 or provided in the Securities or, in the case of Original Issue Discount Securities, such Securities’ yield to maturity.
SECTION 3.07
Securities Redeemed in Part.
Upon surrender to the Paying Agent of a Security to be redeemed in part, the Issuer shall execute, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge a new Security or Securities, of the same series and of any authorized denomination as requested by such Holder in aggregate principal amount equal to, and in exchange for, the unredeemed portion of the principal of the Security so surrendered that is not redeemed.
SECTION 3.08
Purchase of Securities.
Unless otherwise specified as contemplated by Section 2.01, the Issuer, any Subsidiary Guarantor and any Affiliate of the Issuer or any Subsidiary Guarantor may at any time purchase or otherwise acquire Securities in the open market or by private agreement. Any such acquisition shall not operate as or be deemed for any purpose to be a redemption of the indebtedness represented by such Securities. Any Securities purchased or acquired by the Issuer or a Subsidiary Guarantor may be delivered to the Trustee and, upon such delivery, the indebtedness represented thereby shall be deemed to be satisfied. Section 2.13 shall apply to all Securities so delivered.
SECTION 3.09
Mandatory and Optional Sinking Funds.
The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a “mandatory sinking fund payment,” and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an “optional sinking fund payment.” Unless otherwise provided by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to
22
reduction as provided in Section 3.10. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series and by this Article III.
SECTION 3.10
Satisfaction of Sinking Fund Payments with Securities.
The Issuer or a Subsidiary Guarantor may deliver outstanding Securities of a series (other than any previously called for redemption) and may apply as a credit Securities of a series that have been redeemed either at the election of the Issuer pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such series of Securities;
provided
that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.
SECTION 3.11
Redemption of Securities for Sinking Fund.
Not less than 45 days prior (unless a shorter period shall be satisfactory to the Trustee) to each sinking fund payment date for any series of Securities, the Issuer will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivery of or by crediting Securities of that series pursuant to Section 3.10 and will also deliver or cause to be delivered to the Trustee any Securities to be so delivered. Failure of the Issuer to timely deliver or cause to be delivered such Officers’ Certificate and Securities specified in this paragraph, if any, shall not constitute a default but shall constitute the election of the Issuer (i) that the mandatory sinking fund payment for such series due on the next succeeding sinking fund payment date shall be paid entirely in cash without the option to deliver or credit Securities of such series in respect thereof and (ii) that the Issuer will make no optional sinking fund payment with respect to such series as provided in this Section 3.11.
If the sinking fund payment or payments (mandatory or optional or both) to be made in cash on the next succeeding sinking fund payment date plus any unused balance of any preceding sinking fund payments made in cash shall exceed $100,000 or a lesser sum if the Issuer shall so request with respect to the Securities of any particular series, such cash shall be applied on the next succeeding sinking fund payment date to the redemption of Securities of such series at the sinking fund redemption price together with accrued interest to the date fixed for redemption. If such amount shall be $100,000 or less and the Issuer makes no such request then it shall be carried over until a sum in excess of $100,000 is available. Not less than 30 days before each such sinking fund payment date, the Securities to be redeemed upon such sinking fund payment date shall be selected in the manner specified in Section 3.03 and cause notice of the redemption thereof to be given in the name of and at the expense of the Issuer in the manner provided in Section 3.04. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 3.05, 3.06 and 3.07.
23
ARTICLE IV
COVENANTS
SECTION 4.01
Payment of Securities.
The Issuer shall pay the principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities of each series on the dates and in the manner provided in the Securities of such series and in this Indenture. Principal, premium, interest and any Additional Amounts shall be considered paid on the date due if the Paying Agent (other than the Issuer, a Subsidiary Guarantor or another Subsidiary of the Issuer) holds by 11:00 a.m., New York City time, on that date money deposited by the Issuer or a Subsidiary Guarantor designated for and sufficient to pay all principal, premium, interest and any Additional Amounts then due.
The Issuer shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium (if any), at a rate equal to the then applicable interest rate on the Securities to the extent lawful; and it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and any Additional Amount (without regard to any applicable grace period) at the same rate to the extent lawful.
SECTION 4.02
Maintenance of Office or Agency.
The Issuer will maintain in each Place of Payment for any series of Securities an office or agency (which may be an office of the Trustee, the Registrar or the Paying Agent) where Securities of that series may be presented for registration of transfer or exchange, where Securities of that series may be presented for payment and where notices and demands to or upon the Issuer or a Subsidiary Guarantor in respect of the Securities of that series and this Indenture may be served. Unless otherwise designated by the Issuer by written notice to the Trustee and the Subsidiary Guarantors, such office or agency shall be the office of the Trustee in The City of New York, which on the date hereof is located at 101 Barclay Street, New York, New York 10286. The Issuer will give prompt written notice to the Trustee and the Subsidiary Guarantors of the location, and any change in the location, of such office or agency. If at any time the Issuer shall fail to maintain any such required office or agency or shall fail to furnish the Trustee and the Subsidiary Guarantors with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee.
The Issuer may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations;
provided, however
, that no such designation or rescission shall in any manner relieve the Issuer of its obligation to maintain an office or agency in each Place of Payment for Securities of any series for such purposes. The Issuer will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.
SECTION 4.03
SEC Reports; Financial Statements.
(a)
For so long as the Issuer is subject to the requirements of Section 13 or 15(d) of the Exchange Act, the Issuer shall file with the Trustee, within 15 days after it files the
24
same with the SEC, copies of the annual reports and the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) that the Issuer is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If this Indenture is qualified under the TIA, but not otherwise, the Issuer shall also comply with the provisions of TIA § 314(a).
(b)
If the Issuer is not subject to the requirements of Section 13 or 15(d) of the Exchange Act, the Issuer shall furnish to all Holders of Rule 144A Securities and prospective purchasers of Rule 144A Securities designated by the Holders of Rule 144A Securities, promptly upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) promulgated under the Securities Act of 1933, as amended.
(c)
The availability of the foregoing information or reports on the SEC’s website will be deemed to satisfy the foregoing delivery requirements.
(d)
Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Issuer’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates and statements pursuant to Section 4.04(a)).
SECTION 4.04
Compliance Certificate.
(a)
The Issuer shall deliver to the Trustee, within 120 days after the end of each fiscal year of the Issuer, a statement signed by the principal executive officer, principal financial officer or principal accounting officer of the General Partner, which need not constitute an Officers’ Certificate, complying with TIA § 314(a)(4) and stating that in the course of performance by the signing officer of his duties as such officer of the General Partner, he would normally obtain knowledge of the keeping, observing, performing and fulfilling by the Issuer and any Subsidiary Guarantor of its obligations under this Indenture, and further stating that to the best of his knowledge each of the Issuer and any Subsidiary Guarantor has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance or observance of any of the terms, provisions and conditions hereof (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which such officer may have knowledge and what action the Issuer and any Subsidiary Guarantor is taking or proposes to take with respect thereto).
(b)
The Issuer shall, so long as Securities of any series are outstanding, deliver to the Trustee, as soon as practicable, but in no event more than 30 days, after any Officer of the General Partner becoming aware of any Default or Event of Default under this Indenture, a statement specifying such Default or Event of Default and what action the Issuer and any Subsidiary Guarantor is taking or proposes to take with respect thereto.
25
SECTION 4.05
Existence.
Subject to Article V, the Issuer shall do or cause to be done all things necessary to preserve and keep in full force and effect its existence. This Section 4.05 shall not prohibit or restrict the Issuer from converting into a different form or jurisdiction of legal entity.
SECTION 4.06
Waiver of Stay, Extension or Usury Laws.
Each of the Issuer and the Subsidiary Guarantors covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive it from paying all or any portion of the principal of or interest on the Securities as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture; and (to the extent that it may lawfully do so) each of the Issuer and the Subsidiary Guarantors hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.
SECTION 4.07
Additional Amounts.
If the Securities of a series expressly provide for the payment of Additional Amounts, the Issuer will pay to the Holder of any Security of such series Additional Amounts as expressly provided therein. Whenever in this Indenture there is mentioned, in any context, the payment of the principal of or any premium or interest on, or in respect of, any Security of any series or the net proceeds received from the sale or exchange of any Security of any series, such mention shall be deemed to include mention of the payment of Additional Amounts provided for in this Section 4.07 to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the provisions of this Section 4.07 and express mention of the payment of Additional Amounts (if applicable) in any provisions hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express mention is not made.
ARTICLE V
SUCCESSORS
SECTION 5.01
Limitations on Mergers and Consolidations.
Neither the Issuer nor any Subsidiary Guarantor shall consolidate with or merge into any Person, or sell, lease, convey, assign, transfer or otherwise dispose of, in any transaction or series of transactions, all or substantially all of its assets to any Person (other than a consolidation or merger of the Issuer and one or more Subsidiary Guarantors or of two or more Subsidiary Guarantors, or a sale, lease, conveyance, assignment, transfer or other disposition of all or substantially all of the assets of the Issuer to one or more Subsidiary Guarantors or of a Subsidiary Guarantor to the Issuer or one or more other Subsidiary Guarantors), unless:
(1) either (a) the Issuer or such Subsidiary Guarantor, as the case may be, shall be the continuing Person or (b) the Person (if other than the Issuer or such
26
Subsidiary Guarantor) formed by such consolidation or into which the Issuer or such Subsidiary Guarantor is merged, or to which such sale, lease, conveyance, assignment, transfer or other disposition shall be made (collectively, the “Successor”), is organized under the laws of the United States of America, any political subdivision thereof or any State thereof or the District of Columbia, and expressly assumes by supplemental indenture, in the case of the Issuer, the due and punctual payment of the principal of, premium (if any) and interest on and any Additional Amounts with respect to all the Securities and the performance of the Issuer’s covenants and obligations under this Indenture and the Securities, or, in the case of such Subsidiary Guarantor, the performance of the Guarantee and such Subsidiary Guarantor’s covenants and obligations under this Indenture and the Securities; and
(2) immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall have occurred and be continuing or would result therefrom.
SECTION 5.02
Successor Person Substituted.
Upon any consolidation or merger of the Issuer or a Subsidiary Guarantor, as the case may be, or any sale, lease, conveyance, assignment, transfer or other disposition of all or substantially all of the assets of the Issuer or such Subsidiary Guarantor in accordance with Section 5.01, the Successor formed by such consolidation or into which the Issuer or such Subsidiary Guarantor is merged or to which such sale, lease, conveyance, assignment, transfer or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of the Issuer or such Subsidiary Guarantor, as the case may be, under this Indenture and the Securities with the same effect as if such Successor had been named as the Issuer or such Subsidiary Guarantor, as the case may be, herein and the predecessor Issuer or Subsidiary Guarantor, in the case of a sale, conveyance, assignment, transfer or other disposition (except a lease), shall be released from all obligations under this Indenture, the Securities and, in the case of a Subsidiary Guarantor, its Guarantee.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01
Events of Default.
Unless either inapplicable to a particular series or specifically deleted or modified in or pursuant to the supplemental indenture or Board Resolution establishing such series of Securities or in the form of Security for such series, an “Event of Default,” wherever used herein with respect to Securities of any series, occurs if:
(1) there is a default in the payment of interest on or any Additional Amounts with respect to any Security of that series when the same becomes due and payable and such default continues for a period of 30 days;
(2) there is a default in the payment of the principal of or premium, if any, on any Security of that series as and when the same shall become due and payable,
27
whether at Stated Maturity, upon redemption, by declaration, upon required repurchase or otherwise;
(3) there is a default in the deposit of any sinking fund payment with respect to any Security of that series as and when the same shall become due and payable, and such default continues for a period of 30 days;
(4) the Issuer or any Subsidiary Guarantor fails to comply with any of its other covenants or agreements in, or provisions of, the Securities of such series or this Indenture (other than an agreement, covenant or provision that has expressly been included in this Indenture solely for the benefit of one or more series of Securities other than that series) which shall not have been remedied within the specified period after written notice, as specified in the last paragraph of this Section 6.01;
(5) the Issuer, or if that series of Securities is entitled to the benefits of a Guarantee by a Subsidiary Guarantor that is a Significant Subsidiary, any such Subsidiary Guarantor, pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an involuntary case,
(C) consents to the appointment of a Bankruptcy Custodian of it or for all or substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors;
(6) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that remains unstayed and in effect for 90 days and that:
(A) is for relief against the Issuer or if that series of Securities is entitled to the benefits of a Guarantee by a Subsidiary Guarantor that is a Significant Subsidiary, any such Subsidiary Guarantor as debtor in an involuntary case,
(B) appoints a Bankruptcy Custodian of the Issuer or any such Subsidiary Guarantor or a Bankruptcy Custodian for all or substantially all of the property of the Issuer or any such Subsidiary Guarantor, or
(C) orders the liquidation of the Issuer or any such Subsidiary Guarantor;
(7) if that series of Securities is entitled to the benefits of a Guarantee by a Subsidiary Guarantor that is a Significant Subsidiary, such Guarantee ceases to be in full force and effect with respect to Securities of that series (except as otherwise provided in this Indenture) or is declared null and void in a judicial proceeding, or any such
28
Subsidiary Guarantor denies or disaffirms its obligations under this Indenture or such Guarantee; or
(8) any other Event of Default provided with respect to Securities of that series occurs.
The term “Bankruptcy Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
The Trustee shall not be deemed to know or have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a Default or Event of Default is received by a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture.
When a Default or Event of Default is cured, it ceases.
A Default under clause (4) or (8) of this Section 6.01 is not an Event of Default until the Trustee notifies the Issuer and the Subsidiary Guarantors, or the Holders of at least 25% in principal amount of the then outstanding Securities of the series affected by such Default (or, in the case of a Default under clause (4) of this Section 6.01, if outstanding Securities of other series are affected by such Default, then at least 25% in principal amount of the then outstanding Securities so affected) notify the Issuer, the Subsidiary Guarantors and the Trustee, of the Default, and the Issuer or the applicable Subsidiary Guarantor, as the case may be, fails to cure the Default within 90 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a “Notice of Default.”
SECTION 6.02
Acceleration.
If an Event of Default with respect to any Securities of any series at the time outstanding (other than an Event of Default specified in clause (5) or (6) of Section 6.01) occurs and is continuing, the Trustee by notice to the Issuer and the Subsidiary Guarantors, or the Holders of at least 25% in principal amount of the then outstanding Securities of the series affected by such Event of Default (or, in the case of an Event of Default described in clause (4) of Section 6.01, if outstanding Securities of other series are affected by such Event of Default, then at least 25% in principal amount of the then outstanding Securities so affected) by notice to the Issuer, the Subsidiary Guarantors and the Trustee, may declare the principal of (or, if any such Securities are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of that series) and all accrued and unpaid interest on all then outstanding Securities of such series or of all series, as the case may be, to be due and payable. Upon any such declaration, the amounts due and payable on the Securities shall be due and payable immediately. If an Event of Default specified in clause (5) or (6) of Section 6.01 hereof occurs, such amounts shall
ipso facto
become and be immediately due and payable without any declaration, notice or other act on the part of the Trustee or any Holder. The Holders of a majority in principal amount of the then outstanding Securities of the series affected by such Event of Default or all series so affected, as the case may be, by written notice to the Trustee may rescind an acceleration and its consequences (other than nonpayment of principal of or
29
premium or interest on or any Additional Amounts with respect to the Securities) if the rescission would not conflict with any judgment or decree and if all existing Events of Default with respect to Securities of that series (or of all series, as the case may be) have been cured or waived, except nonpayment of principal, premium, interest or any Additional Amounts that has become due solely because of the acceleration.
SECTION 6.03
Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of, or premium, if any, or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.
SECTION 6.04
Waiver of Defaults.
Subject to Sections 6.07 and 9.02, the Holders of a majority in principal amount of the then outstanding Securities of any series or of all series affected thereby (acting as one class) by notice to the Trustee may waive an existing or past Default or Event of Default with respect to such series or all series so affected, as the case may be, and its consequences (including waivers obtained in connection with a tender offer or exchange offer for Securities of such series or all series so affected or a solicitation of consents in respect of Securities of such series or all series so affected,
provided
that in each case such offer or solicitation is made to all Holders of then outstanding Securities of such series or all series so affected (but the terms of such offer or solicitation may vary from series to series)), except (1) a continuing Default or Event of Default in the payment of the principal of, or premium, if any, or interest on or any Additional Amounts with respect to any Security or (2) a continued Default in respect of a provision that under Section 9.02 cannot be amended or supplemented without the consent of each Holder affected. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.
SECTION 6.05
Control by Majority.
With respect to Securities of any series, the Holders of a majority in principal amount of the then outstanding Securities of such series may direct in writing the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it relating to or arising under an Event of Default described in clause (1), (2), (3), (7) or (8) of Section 6.01, and with respect to all Securities, the Holders of a majority in principal amount of all the then outstanding Securities affected may direct in writing the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it not relating to or arising under such an Event of
30
Default. However, the Trustee may refuse to follow any direction that conflicts with applicable law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of other Holders, or that may involve the Trustee in personal liability;
provided, however
, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. Prior to taking any action hereunder, the Trustee shall be entitled to security or indemnification satisfactory to it in its sole discretion from Holders directing the Trustee against all losses and expenses caused by taking or not taking such action.
SECTION 6.06
Limitations on Suits.
Subject to Section 6.07 hereof, a Holder of a Security of any series may pursue a remedy with respect to this Indenture or the Securities of such series or the related Guarantees, if any, only if:
(1) the Holder gives to the Trustee written notice of a continuing Event of Default with respect to such series;
(2) the Holders of at least 25% in principal amount of the then outstanding Securities of such series make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and
(5) during such 60-day period, the Holders of a majority in principal amount of the Securities of such series do not give the Trustee a direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder.
SECTION 6.07
Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder of a Security to receive payment of principal of and premium, if any, and interest on and any Additional Amounts with respect to the Security, on or after the respective due dates expressed in the Security, or to bring suit for the enforcement of any such payment on or after such respective dates, is absolute and unconditional and shall not be impaired or affected without the consent of the Holder.
SECTION 6.08
Collection Suit by Trustee.
If an Event of Default specified in clause (1) or (2) of Section 6.01 hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Issuer or a Subsidiary Guarantor for the amount of principal, premium (if any), interest and any Additional Amounts remaining unpaid on the Securities of the
31
series affected by the Event of Default, and interest on overdue principal and premium, if any, and, to the extent lawful, interest on overdue interest, and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09
Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers or documents and to take such actions, including participating as a member, voting or otherwise, of any committee of creditors, as may be necessary or advisable to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Issuer or a Subsidiary Guarantor or their respective creditors or properties and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any Bankruptcy Custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties which the Holders of the Securities may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10
Priorities.
If the Trustee collects any money pursuant to this Article VI, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for amounts due and unpaid on the Securities in respect of which or for the benefit of which such money has been collected, for principal, premium (if any), interest and any Additional Amounts ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal, premium (if any), interest and any Additional Amounts, respectively; and
Third: to the Issuer or as a court of competent jurisdiction shall direct in writing.
The Trustee, upon prior written notice to the Issuer, may fix record dates and payment dates for any payment to Holders pursuant to this Article VI.
32
To the fullest extent allowed under applicable law, if for the purpose of obtaining a judgment against the Issuer or a Subsidiary Guarantor in any court it is necessary to convert the sum due in respect of the principal of, premium (if any) or interest on or Additional Amounts with respect to the Securities of any series (the “Required Currency”) into a currency in which a judgment will be rendered (the “Judgment Currency”), the rate of exchange used for purposes of rendering the judgment shall be the rate at which in accordance with normal banking procedures the Trustee could purchase in The City of New York the Required Currency with the Judgment Currency on the Business Day in The City of New York next preceding that on which final judgment is given. None of the Issuer, any Subsidiary Guarantor or the Trustee shall be liable for any shortfall nor shall it benefit from any windfall in payments to Holders of Securities under this Section 6.10 caused by a change in exchange rates between the time the amount of a judgment against it is calculated as above and the time the Trustee converts the Judgment Currency into the Required Currency to make payments under this Section 6.10 to Holders of Securities, but payment of such judgment shall discharge all amounts owed by the Issuer and the Subsidiary Guarantors on the claim or claims underlying such judgment.
SECTION 6.11
Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than 10% in principal amount of the then outstanding Securities of any series.
ARTICLE VII
TRUSTEE
SECTION 7.01
Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in such exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.
(b) Except during the continuance of an Event of Default with respect to the Securities of any series:
(1) the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine such certificates and opinions to
33
determine whether, on their face, they appear to conform to the requirements of this Indenture but need not confirm or investigate the accuracy of any such opinions and certificates.
(c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
(1) this paragraph does not limit the effect of Section 7.01(b);
(2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05.
(d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to the provisions of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Issuer and the Subsidiary Guarantors. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. All money received by the Trustee shall, until applied as herein provided, be held in trust for the payment of the principal of, premium (if any) and interest on and Additional Amounts with respect to the Securities.
SECTION 7.02
Rights of Trustee.
(a) The Trustee may conclusively rely on any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require instruction, an Officers’ Certificate or an Opinion of Counsel or both to be provided. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such instruction, Officers’ Certificate or Opinion of Counsel. The Trustee may consult at the Issuer’s expense with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
34
(d) The Trustee shall not be liable for any action it takes or omits to take in good faith which it reasonably believes to be authorized or within its rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Issuer or any Subsidiary Guarantor shall be sufficient if signed by an Officer of the Issuer or such Subsidiary Guarantor, as the case may be.
(f) The Trustee shall not be obligated to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document.
(g) The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.
(h) The Trustee may request that the Issuer deliver an Officers’ Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers’ Certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.
(i) In no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.
SECTION 7.03
May Hold Securities.
The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Issuer, any Subsidiary Guarantor or any of their respective Affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights and duties. However, the Trustee is subject to Sections 7.10 and 7.11.
SECTION 7.04
Trustee’s Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Issuer’s use of the proceeds from the Securities or any money paid to the Issuer or any Subsidiary Guarantor or upon the Issuer’s or such Subsidiary Guarantor’s direction under any provision hereof, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee and it shall not be responsible for any statement or recital herein or any statement in the Securities other than its certificate of authentication.
35
SECTION 7.05
Notice of Defaults.
If a Default or Event of Default with respect to the Securities of any series occurs and is continuing and it is known to the Trustee, the Trustee shall transmit to Holders of Securities of such series a notice of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium (if any) and interest on and Additional Amounts or any sinking fund installment with respect to the Securities of such series, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Holders of Securities of such series.
SECTION 7.06
Reports by Trustee to Holders.
Within 60 days after May 15 of each year after the execution of this Indenture, the Trustee shall transmit to Holders of a series, the Subsidiary Guarantors and the Issuer a brief report dated as of such reporting date that complies with TIA § 313(a);
provided, however
, that if no event described in TIA § 313(a) has occurred within the twelve months preceding the reporting date with respect to a series, no report need be transmitted to Holders of such series. The Trustee also shall comply with TIA § 313(b). The Trustee shall also transmit all reports if and as required by TIA §§ 313(c) and 313(d).
A copy of each report at the time of its transmission to Holders of a series of Securities shall be filed by the Issuer or a Subsidiary Guarantor with the SEC and each securities exchange, if any, on which the Securities of such series are listed. The Issuer shall notify the Trustee if and when any series of Securities is listed or delisted on any securities exchange.
SECTION 7.07
Compensation and Indemnity.
The Issuer agrees to pay to the Trustee for its acceptance of this Indenture and services hereunder such compensation as the Issuer and the Trustee shall from time to time agree in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuer agrees to reimburse the Trustee upon request for all reasonable disbursements, advances and expenses incurred by it. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel.
The Issuer hereby agrees to indemnify the Trustee and any predecessor Trustee against any and all loss, liability, damage, claim or expense, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, except as set forth in the next following paragraph. The Trustee shall notify the Issuer and the Subsidiary Guarantors promptly of any claim of which a Responsible Officer has received written notice and for which it may seek indemnity. The Issuer shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Issuer shall pay the reasonable fees and expenses of such counsel. The Issuer need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld.
36
The Issuer shall not be obligated to reimburse any expense or indemnify against any loss or liability incurred by the Trustee as determined to have been caused by the Trustee’s own negligence, willful misconduct or bad faith.
To secure the payment obligations of the Issuer in this Section 7.07, the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee, except for money or property held in trust to pay principal of, premium (if any) and interest on and any Additional Amounts with respect to Securities of any series. Such lien and the Issuer’s obligations under this Section 7.07 shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(5) or (6) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.
SECTION 7.08
Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.08.
The Trustee may resign and be discharged at any time with respect to the Securities of one or more series by so notifying the Issuer and the Subsidiary Guarantors. The Holders of a majority in principal amount of the then outstanding Securities of any series may remove the Trustee with respect to the Securities of such series by so notifying the Trustee, the Issuer and the Subsidiary Guarantors. The Issuer may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
(3) a Bankruptcy Custodian or public officer takes charge of the Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, with respect to the Securities of one or more series, the Issuer shall promptly appoint a successor Trustee or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series). Within one year after the successor Trustee with respect to the Securities of any series takes office, the Holders of a majority in principal amount of the Securities of such series then outstanding may appoint a successor Trustee to replace the successor Trustee appointed by the Issuer.
If a successor Trustee with respect to the Securities of any series does not take office within 30 days after the retiring or removed Trustee resigns or is removed, the retiring or
37
removed Trustee (at the expense of the Issuer), the Issuer, any Subsidiary Guarantor or the Holders of at least 10% in principal amount of the then outstanding Securities of such series may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.
If the Trustee with respect to the Securities of a series fails to comply with Section 7.10, any Holder of Securities of such series may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee with respect to the Securities of such series.
In case of the appointment of a successor Trustee with respect to all Securities, each such successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee, to the Issuer and to the Subsidiary Guarantors. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the retiring Trustee under this Indenture. The successor Trustee shall transmit a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, upon payment of its charges hereunder and subject to the lien provided for in Section 7.07.
In case of the appointment of a successor Trustee with respect to the Securities of one or more (but not all) series, the Issuer, the Subsidiary Guarantors, the retiring Trustee and each successor Trustee with respect to the Securities of one or more (but not all) series shall execute and deliver a supplemental indenture in which each successor Trustee shall accept such appointment and that (1) shall confer to each successor Trustee all the rights, powers and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Securities, shall confirm that all the rights, powers and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee. Nothing herein or in such supplemental indenture shall constitute such Trustees as co-trustees of the same trust, and each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee. Upon the execution and delivery of such supplemental indenture, the resignation or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee shall have all the rights, powers and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates. On request of the Issuer or any successor Trustee, such retiring Trustee shall transfer to such successor Trustee all property held by such retiring Trustee as Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates. Such retiring Trustee shall, however, have the right to deduct its unpaid fees and expenses, including attorneys’ fees.
Notwithstanding replacement of the Trustee or Trustees pursuant to this Section 7.08, the obligations of the Issuer under Section 7.07 shall continue for the benefit of the retiring Trustee or Trustees.
38
SECTION 7.09
Successor Trustee by Merger, etc.
Subject to Section 7.10, if the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor Trustee;
provided, however
, that in the case of a transfer of all or substantially all of its corporate trust business to another corporation, the transferee corporation expressly assumes all of the Trustee’s liabilities hereunder.
In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor to the Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Securities or in this Indenture provided that the certificate of the Trustee shall have.
SECTION 7.10
Eligibility; Disqualification.
There shall at all times be a Trustee hereunder which shall be a corporation or banking association organized and doing business under the laws of the United States, any State thereof or the District of Columbia and authorized under such laws to exercise corporate trust power, shall be subject to supervision or examination by federal or state (or the District of Columbia) authority and shall have, or be a subsidiary of a bank or bank holding company having, a combined capital and surplus of at least $50 million as set forth in its most recent published annual report of condition.
The Indenture shall always have a Trustee who satisfies the requirements of TIA §§ 310(a)(1), 310(a)(2) and 310(a)(5). The Trustee is subject to and shall comply with the provisions of TIA § 310(b) during the period of time required by this Indenture. Nothing in this Indenture shall prevent the Trustee from filing with the SEC the application referred to in the penultimate paragraph of TIA § 310(b).
SECTION 7.11
Preferential Collection of Claims Against the Issuer or a Subsidiary Guarantor.
The Trustee is subject to and shall comply with the provisions of TIA § 311(a), excluding any creditor relationship listed in TIA § 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated therein.
ARTICLE VIII
DISCHARGE OF INDENTURE
SECTION 8.01
Termination of the Issuer’s and the Subsidiary Guarantors’ Obligations.
(a) This Indenture shall cease to be of further effect with respect to the Securities of a series (except that the Issuer’s obligations under Sections 2.05, 2.07, 2.08, 2.09,
39
4.02, 7.07, 7.08 and 8.04, the Trustee’s and Paying Agent’s obligations under Section 8.03 and the rights, powers, protections and privileges accorded the Trustee under Article VII shall survive until all Securities of such series are no longer outstanding and, thereafter, only the Issuer’s obligations under Section 7.07, the Trustee’s and Paying Agent’s obligations under Section 8.03 and the rights, powers, protections and privileges accorded the Trustee under Article VII shall survive), and the Trustee and the Subsidiary Guarantors, if any, on demand of the Issuer, shall execute proper instruments acknowledging the satisfaction and discharge of this Indenture with respect to the Securities of such series, when:
(1) either:
(A) all outstanding Securities of such series theretofore authenticated and issued (other than destroyed, lost or stolen Securities that have been replaced or paid) have been delivered to the Trustee for cancellation; or
(B) all outstanding Securities of such series not theretofore delivered to the Trustee for cancellation:
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one year, or
(iii) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuer,
and, in the case of clause (i), (ii) or (iii) above, the Issuer or a Subsidiary Guarantor has irrevocably deposited or caused to be deposited with the Trustee as funds (immediately available to the Holders in the case of clause (i)) in trust for such purpose (x) cash in an amount, or (y) Government Obligations, maturing as to principal and interest at such times and in such amounts as will ensure the availability of cash in an amount or (z) a combination thereof, which will be sufficient, in the opinion (in the case of clauses (y) and (z)) of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge the entire indebtedness on the Securities of such series for principal and interest to the date of such deposit (in the case of Securities which have become due and payable) or for principal, premium, if any, and interest to the Stated Maturity or Redemption Date, as the case may be; or
(C) the Issuer and the Subsidiary Guarantors have properly fulfilled such other means of satisfaction and discharge as is specified, as contemplated by Section 2.01, to be applicable to the Securities of such series;
(2) the Issuer or a Subsidiary Guarantor has paid or caused to be paid all other sums payable by them hereunder with respect to the Securities of such series; and
40
(3) the Issuer has delivered to the Trustee an Officers’ Certificate stating that all conditions precedent to satisfaction and discharge of this Indenture with respect to the Securities of such series have been complied with, together with an Opinion of Counsel to the same effect.
(b) Unless this Section 8.01(b) is specified as not being applicable to Securities of a series as contemplated by Section 2.01, the Issuer may, at its option, terminate its and the Subsidiary Guarantors’ respective obligations under this Indenture other than the continuing obligations specified in the next succeeding paragraph of this Section 8.01(b) (“covenant defeasance”) with respect to the Securities of a series if:
(1) the Issuer or a Subsidiary Guarantor has irrevocably deposited or caused to be irrevocably deposited with the Trustee as trust funds in trust for the purpose of making the following payments, specifically pledged as security for and dedicated solely to the benefit of the Holders of Securities of such series, (i) cash in an amount, or (ii) Government Obligations, maturing as to principal and interest at such times and in such amounts as will ensure the availability of cash in an amount or (iii) a combination thereof, that is sufficient, in the opinion (in the case of clauses (ii) and (iii)) of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay the principal of and premium (if any) and interest on all Securities of such series on each date that such principal, premium (if any) or interest is due and payable and (at the Stated Maturity thereof or upon redemption as provided in Section 8.01(f)) to pay all other sums payable by it hereunder;
provided
that the Trustee shall have been irrevocably instructed to apply such money and/or the proceeds of such Government Obligations to the payment of said principal, premium (if any) and interest with respect to the Securities of such series as the same shall become due;
(2) the Issuer has delivered to the Trustee an Officers’ Certificate stating that all conditions precedent to covenant defeasance with respect to the Securities of such series have been complied with, and an Opinion of Counsel to the same effect;
(3) no Default or Event of Default with respect to the Securities of such series shall have occurred and be continuing on the date of such deposit;
(4) the Issuer shall have delivered to the Trustee an Opinion of Counsel from a nationally recognized counsel acceptable to the Trustee or a private letter ruling issued by the United States Internal Revenue Service to the effect that the Holders will not recognize income, gain or loss for United States Federal income tax purposes as a result of the Issuer’s exercise of its option under this Section 8.01(b) and will be subject to United States Federal income tax on the same amount and in the same manner and at the same times as would have been the case if such option had not been exercised;
(5) the Issuer and the Subsidiary Guarantors have complied with any additional conditions specified pursuant to Section 2.01 to be applicable to the covenant defeasance of Securities of such series pursuant to this Section 8.01; and
41
(6) such deposit and discharge shall not cause the Trustee to have a conflicting interest as defined in TIA § 310(b).
In such event, the Issuer’s and the Subsidiary Guarantors’ respective obligations under this Indenture shall cease to be of further effect (except as set forth in this paragraph), no Default shall occur as a result of a failure to comply therewith and the Trustee and the Subsidiary Guarantors, on demand of the Issuer, shall execute proper instruments acknowledging covenant defeasance under this Indenture. However, the Issuer’s and the Subsidiary Guarantors’ respective obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.09, 4.01, 4.02, 7.07, 7.08 and 8.04, the Trustee’s and Paying Agent’s obligations in Section 8.03 and the rights, powers, protections and privileges accorded the Trustee under Article VII shall survive until all Securities of such series are no longer outstanding. Thereafter, only the Issuer’s obligations in Section 7.07 and the Trustee’s and Paying Agent’s obligations in Section 8.03 shall survive with respect to Securities of such series.
After such irrevocable deposit made pursuant to this Section 8.01(b) and satisfaction of the other conditions set forth herein, the Trustee upon request shall acknowledge in writing the termination of the Issuer’s and the Subsidiary Guarantors’ obligations under this Indenture with respect to the Securities of such series except for those surviving obligations specified above.
(c) If the Issuer and the Subsidiary Guarantors have previously complied or are concurrently complying with Section 8.01(b) (other than any additional conditions specified pursuant to Section 2.01 that are expressly applicable only to covenant defeasance) with respect to Securities of a series, then, unless this Section 8.01(c) is specified as not being applicable to Securities of such series as contemplated by Section 2.01, the Issuer may elect that its and the Subsidiary Guarantors’ respective obligations to make payments with respect to Securities of such series be discharged (“legal defeasance”), if:
(1) no Default or Event of Default under clauses (5) and (6) of Section 6.01 hereof shall have occurred at any time during the period ending on the 91st day after the date of deposit contemplated by Section 8.01(b) (it being understood that this condition shall not be deemed satisfied until the expiration of such period);
(2) unless otherwise specified with respect to Securities of such series as contemplated by Section 2.01, the Issuer has delivered to the Trustee an Opinion of Counsel from a nationally recognized counsel to the effect referred to in Section 8.01(b)(4) with respect to such legal defeasance, which opinion is based on (i) a private letter ruling issued by the United States Internal Revenue Service addressed to the Issuer, (ii) a published ruling of the United States Internal Revenue Service pertaining to a comparable form of transaction or (iii) a change in the applicable United States federal income tax law (including regulations) after the date of this Indenture;
(3) the Issuer and the Subsidiary Guarantors have complied with any other conditions specified pursuant to Section 2.01 to be applicable to the legal defeasance of Securities of such series pursuant to this Section 8.01(c); and
42
(4) the Issuer has delivered to the Trustee an Issuer Order requesting such legal defeasance of the Securities of such series and an Officers’ Certificate stating that all conditions precedent with respect to such legal defeasance of the Securities of such series have been complied with, together with an Opinion of Counsel to the same effect.
In such event, the Issuer and the Subsidiary Guarantors will be discharged from all of their respective obligations under this Indenture and the Securities of such series, including their obligations under Sections 4.01 and 10.01 to pay principal of, premium (if any) and interest on, and any Additional Amounts with respect to, Securities of such series, and the entire indebtedness of the Issuer evidenced by such Securities and of the Subsidiary Guarantors evidenced by the related Guarantees, if any, shall be deemed paid and discharged. However, the Issuer’s and the Subsidiary Guarantors’ respective obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.09, 4.02, 7.07, 7.08 and 8.04, the Trustee’s and Paying Agent’s obligations in Section 8.03 and the rights, powers, protections and privileges accorded the Trustee under Article VII shall survive until all Securities of such series are no longer outstanding. Thereafter, only the Issuer’s obligations in Section 7.07 and the Trustee’s and Paying Agent’s obligations in Section 8.03 shall survive with respect to Securities of such series.
(d) In order to have money available on a payment date to pay principal of or premium (if any) or interest on the Securities, any Government Obligations deposited with the Trustee pursuant to this Section 8.01 shall be payable as to principal or interest on or before such payment date in such amounts as will provide the necessary money. Government Obligations shall not be callable at the issuer’s option.
(e) If and to the extent additional or alternative means of satisfaction and discharge or defeasance of Securities of a series are specified to be applicable to such series as contemplated by Section 2.01, each of the Issuer and the Subsidiary Guarantors may terminate any or all of its obligations under this Indenture with respect to Securities of a series and any or all of its obligations under the Securities of such series if it fulfills such other means of satisfaction and discharge or defeasance as may be so specified, as contemplated by Section 2.01, to be applicable to the Securities of such series.
(f) If Securities of any series subject to this Section 8.01 are to be redeemed prior to their Stated Maturity, whether pursuant to any optional redemption provisions or in accordance with any mandatory or optional sinking fund provisions, the terms of the applicable trust arrangement shall provide for such redemption, and the Issuer shall make such arrangements as are reasonably satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuer.
SECTION 8.02
Application of Trust Money.
The Trustee shall hold in trust money or Government Obligations deposited with it pursuant to Section 8.01 hereof. Subject to Section 8.03, it shall apply the deposited money and the money from Government Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal of, premium (if any) and interest on and any Additional Amounts with respect to the Securities of the series with respect to which the deposit was made.
43
SECTION 8.03
Repayment to Issuer or Subsidiary Guarantor.
The Trustee and the Paying Agent shall promptly pay to the Issuer or any Subsidiary Guarantor any excess money or Government Obligations (or proceeds therefrom) held by them at any time upon the written request of the Issuer.
Subject to the requirements of any applicable abandoned property laws, the Trustee and the Paying Agent shall pay to the Issuer upon written request any money held by them for the payment of principal, premium (if any), interest or any Additional Amounts that remain unclaimed for two years after the date upon which such payment shall have become due. After payment to the Issuer, Holders entitled to the money must look to the Issuer for payment as general creditors unless an applicable abandoned property law designates another Person, and all liability of the Trustee and the Paying Agent with respect to such money shall cease.
SECTION 8.04
Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money or Government Obligations deposited with respect to Securities of any series in accordance with Section 8.01 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the obligations of the Issuer and the Subsidiary Guarantors under this Indenture with respect to the Securities of such series and under the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.01 until such time as the Trustee or the Paying Agent is permitted to apply all such money or Government Obligations in accordance with Section 8.01;
provided, however,
that if the Issuer or any Subsidiary Guarantor has made any payment of principal of, premium (if any) or interest on or any Additional Amounts with respect to any Securities because of the reinstatement of their obligations, the Issuer or such Subsidiary Guarantor, as the case may be, shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or Government Obligations held by the Trustee or the Paying Agent.
ARTICLE IX
SUPPLEMENTAL INDENTURES AND AMENDMENTS
SECTION 9.01
Without Consent of Holders.
The Issuer, the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture or the Securities or waive any provision hereof or thereof without the consent of any Holder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Section 5.01;
(3) to provide for uncertificated Securities in addition to or in place of certificated Securities;
44
(4) to provide any security for, or to add any guarantees of or additional obligors on, any series of Securities or the related Guarantees, if any;
(5) to comply with any requirement in order to effect or maintain the qualification of this Indenture under the TIA;
(6) to add to the covenants of the Issuer or any Subsidiary Guarantor for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series), or to surrender any right or power herein conferred upon the Issuer or any Subsidiary Guarantor;
(7) to add any additional Events of Default with respect to all or any series of the Securities (and, if any such Event of Default is applicable to less than all series of Securities, specifying the series to which such Event of Default is applicable);
(8) to change or eliminate any of the provisions of this Indenture;
provided
that any such change or elimination shall become effective only when there is no outstanding Security of any series created prior to the execution of such amendment or supplemental indenture that is adversely affected in any material respect by such change in or elimination of such provision;
(9) to establish the form or terms of Securities of any series as permitted by Section 2.01;
(10) to supplement any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the defeasance and discharge of any series of Securities pursuant to Section 8.01;
provided, however
, that any such action shall not adversely affect the interest of the Holders of Securities of such series or any other series of Securities in any material respect; or
(11) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 7.08.
Upon the request of the Issuer, accompanied by a Board Resolution, and upon receipt by the Trustee of the documents described in Section 9.06, the Trustee shall, subject to Section 9.06, join with the Issuer and the Subsidiary Guarantors in the execution of any supplemental indenture authorized or permitted by the terms of this Indenture and make any further appropriate agreements and stipulations that may be therein contained.
SECTION 9.02
With Consent of Holders.
Except as provided below in this Section 9.02, the Issuer, the Subsidiary Guarantors and the Trustee may amend or supplement this Indenture with the consent (including consents obtained in connection with a tender offer or exchange offer for Securities of any one or
45
more series or all series or a solicitation of consents in respect of Securities of any one or more series or all series,
provided
that in each case such offer or solicitation is made to all Holders of then outstanding Securities of each such series (but the terms of such offer or solicitation may vary from series to series)) of the Holders of a majority in principal amount of the then outstanding Securities of all series affected by such amendment or supplement (acting as one class).
Upon the request of the Issuer, accompanied by a Board Resolution, and upon the filing with the Trustee of evidence of the consent of the Holders as aforesaid, and upon receipt by the Trustee of the documents described in Section 9.06, the Trustee shall, subject to Section 9.06, join with the Issuer and the Subsidiary Guarantors in the execution of such amendment or supplemental indenture.
It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.
The Holders of a majority in principal amount of the then outstanding Securities of one or more series or of all series (acting as one class) may waive compliance in a particular instance by the Issuer or any Subsidiary Guarantor with any provision of this Indenture with respect to Securities of such series (including waivers obtained in connection with a tender offer or exchange offer for Securities of such series or a solicitation of consents in respect of Securities of such series,
provided
that in each case such offer or solicitation is made to all Holders of then outstanding Securities of such series (but the terms of such offer or solicitation may vary from series to series)).
However, without the consent of each Holder affected, an amendment, supplement or waiver under this Section 9.02 may not:
(1) reduce the amount of Securities whose Holders must consent to an amendment, supplement or waiver;
(2) reduce the rate of or change the time for payment of interest, including default interest, on any Security;
(3) reduce the principal of, any premium on or any mandatory sinking fund payment with respect to, or change the Stated Maturity of, any Security or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 6.02;
(4) reduce the premium, if any, payable upon the redemption of any Security or change the time at which any Security may or shall be redeemed;
(5) change any obligation of the Issuer or any Subsidiary Guarantor to pay Additional Amounts with respect to any Security;
46
(6) change the coin or currency in which any Security or any premium, interest or Additional Amounts with respect thereto are payable;
(7) impair the right to institute suit for the enforcement of any payment of principal of, premium (if any) or interest on or any Additional Amounts with respect to any Security pursuant to Sections 6.07 and 6.08, except as limited by Section 6.06;
(8) make any change in the percentage of principal amount of Securities necessary to waive compliance with certain provisions of this Indenture pursuant to Section 6.04 or 6.07 or make any change in this sentence of Section 9.02;
(9) if applicable, make any change that materially and adversely affects the right to convert any Security; or
(10) waive a continuing Default or Event of Default in the payment of principal of, premium (if any) or interest on or Additional Amounts with respect to the Securities.
A supplemental indenture that changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series.
The right of any Holder to participate in any consent required or sought pursuant to any provision of this Indenture (and the obligation of the Issuer or any Subsidiary Guarantor to obtain any such consent otherwise required from such Holder) may be subject to the requirement that such Holder shall have been the Holder of record of any Securities with respect to which such consent is required or sought as of a date identified by the Issuer or such Subsidiary Guarantor in a notice furnished to Holders in accordance with the terms of this Indenture.
After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Issuer shall transmit to the Holders of each Security affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Issuer to transmit such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment, supplement or waiver.
SECTION 9.03
Compliance with the Trust Indenture Act.
Every amendment or supplement to this Indenture or the Securities shall comply in form and substance with the TIA as then in effect.
SECTION 9.04
Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to his or her Security or portion of a Security if the Trustee
47
receives written notice of revocation before a date and time therefor identified by the Issuer or any Subsidiary Guarantor in a notice furnished to such Holder in accordance with the terms of this Indenture or, if no such date and time shall be identified, the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder.
The Issuer or any Subsidiary Guarantor may, but shall not be obligated to, fix a record date (which need not comply with TIA § 316(c)) for the purpose of determining the Holders entitled to consent to any amendment, supplement or waiver or to take any other action under this Indenture. If a record date is fixed, then notwithstanding the provisions of the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to consent to such amendment, supplement or waiver or to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date. No consent shall be valid or effective for more than 90 days after such record date unless consents from Holders of the principal amount of Securities required hereunder for such amendment or waiver to be effective shall have also been given and not revoked within such 90-day period.
After an amendment, supplement or waiver becomes effective, it shall bind every Holder, unless it is of the type described in any of clauses (1) through (10) of Section 9.02 hereof. In such case, the amendment, supplement or waiver shall bind each Holder who has consented to it and every subsequent Holder that evidences the same debt as the consenting Holder’s Security.
SECTION 9.05
Notation on or Exchange of Securities.
If an amendment or supplement changes the terms of an outstanding Security, the Issuer may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security at the request of the Issuer regarding the changed terms and return it to the Holder. Alternatively, if the Issuer so determines, the Issuer in exchange for the Security shall issue, each Subsidiary Guarantor, if any, with respect to such series shall execute the Notation of Guarantee relating to, and the Trustee shall authenticate a new Security that reflects the changed terms. Failure to make the appropriate notation or to issue a new Security shall not affect the validity of such amendment or supplement.
Securities of any series authenticated and delivered after the execution of any amendment or supplement may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such amendment or supplement.
SECTION 9.06
Trustee to Sign Amendments, etc.
The Trustee shall sign any amendment or supplement authorized pursuant to this Article if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may, but need not, sign it. In signing or refusing to sign such amendment or supplement, the Trustee shall be provided with, and, subject to Section 7.01 hereof, shall be fully protected in relying upon, an Opinion of Counsel provided
48
at the expense of the Issuer or a Subsidiary Guarantor to the effect that such amendment or supplement is authorized or permitted by this Indenture.
ARTICLE X
GUARANTEE
SECTION 10.01
Guarantee.
(a) Notwithstanding any provision of this Article X to the contrary, the provisions of this Article X relating to a Subsidiary Guarantor shall be applicable only to, and inure solely to the benefit of, the Securities of any series designated, pursuant to Section 2.01, as entitled to the benefits of the related Guarantee of such Subsidiary Guarantor. If no Security is outstanding that is entitled to the benefits of a Guarantee by a Subsidiary Guarantor, this Article X shall have no force and effect.
(b) For value received and subject to the provisions of Section 10.01(a), each of the Subsidiary Guarantors hereby fully, unconditionally and absolutely guarantees to the Holders and to the Trustee the due and punctual payment of the principal of, and premium, if any, and interest on the Securities and all other amounts due and payable under this Indenture and the Securities by the Issuer, when and as such principal, premium, if any, and interest shall become due and payable, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise, according to the terms of the Securities and this Indenture, subject to the limitations set forth in Section 10.03.
(c) Failing payment when due of any amount guaranteed pursuant to the related Guarantee, for whatever reason, each of the Subsidiary Guarantors will be jointly and severally obligated to pay the same immediately. Each of the Guarantees hereunder is intended to be a general, unsecured, senior obligation of the related Subsidiary Guarantor and will rank pari passu in right of payment with all indebtedness of such Subsidiary Guarantor that is not, by its terms, expressly subordinated in right of payment to such Guarantee. Each of the Subsidiary Guarantors hereby agrees that its obligations hereunder shall be full, unconditional and absolute, irrespective of the validity, regularity or enforceability of the Securities, its Guarantee, the Guarantee of any other Subsidiary Guarantor or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Securities with respect to any provisions hereof or thereof, the recovery of any judgment against the Issuer or any Subsidiary Guarantor, or any action to enforce the same or any other circumstances which might otherwise constitute a legal or equitable discharge or defense of the Subsidiary Guarantors. Each of the Subsidiary Guarantors hereby agrees that in the event of a default in payment of the principal of, or premium, if any, or interest on the Securities of such series, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise, legal proceedings may be instituted by the Trustee on behalf of the Holders or, subject to Section 6.06, by the Holders, on the terms and conditions set forth in this Indenture, directly against such Subsidiary Guarantor to enforce such Guarantee without first proceeding against the Issuer or any other Subsidiary Guarantor.
(d) The obligations of each of the Subsidiary Guarantors under this Article X shall be as aforesaid full, unconditional and absolute and shall not be impaired, modified,
49
released or limited by any occurrence or condition whatsoever, including, without limitation, (i) any compromise, settlement, release, waiver, renewal, extension, indulgence or modification of, or any change in, any of the obligations and liabilities of the Issuer or any of the Subsidiary Guarantors contained in the Securities or this Indenture, (ii) any impairment, modification, release or limitation of the liability of the Issuer, any of the Subsidiary Guarantors or any of their estates in bankruptcy, or any remedy for the enforcement thereof, resulting from the operation of any present or future provision of any applicable Bankruptcy Law or other statute or from the decision of any court, (iii) the assertion or exercise by the Issuer, any of the Subsidiary Guarantors or the Trustee of any rights or remedies under the Securities or this Indenture or their delay in or failure to assert or exercise any such rights or remedies, (iv) the assignment or the purported assignment of any property as security for the Securities, including all or any part of the rights of the Issuer or any of the Subsidiary Guarantors under this Indenture, (v) the extension of the time for payment by the Issuer or any of the Subsidiary Guarantors of any payments or other sums or any part thereof owing or payable under any of the terms and provisions of the Securities or this Indenture or of the time for performance by the Issuer or any of the Subsidiary Guarantors of any other obligations under or arising out of any such terms and provisions or the extension or the renewal of any thereof, (vi) the modification or amendment (whether material or otherwise) of any duty, agreement or obligation of the Issuer or any of the Subsidiary Guarantors set forth in this Indenture, (vii) the voluntary or involuntary liquidation, dissolution, sale or other disposition of all or substantially all of the assets, marshaling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of, or other similar proceeding affecting, the Issuer or any of the Subsidiary Guarantors or any of their respective assets, or the disaffirmance of the Securities, the Guarantee or this Indenture in any such proceeding, (viii) the release or discharge of the Issuer or any of the Subsidiary Guarantors from the performance or observance of any agreement, covenant, term or condition contained in any of such instruments by operation of law, (ix) the unenforceability of the Securities of such series, the related Guarantees or this Indenture or (x) any other circumstances (other than payment in full or discharge of all amounts guaranteed pursuant to the related Guarantees) which might otherwise constitute a legal or equitable discharge of a surety or guarantor.
(e) Each of the Subsidiary Guarantors hereby (i) waives diligence, presentment, demand of payment, filing of claims with a court in the event of the merger, insolvency or bankruptcy of the Issuer or any of the Subsidiary Guarantors, and all demands whatsoever, (ii) acknowledges that any agreement, instrument or document evidencing its Guarantee may be transferred and that the benefit of its obligations hereunder shall extend to each holder of any agreement, instrument or document evidencing its Guarantee without notice to it and (iii) covenants that its Guarantee will not be discharged except by complete performance of such Guarantee. Each of the Subsidiary Guarantors further agrees that if at any time all or any part of any payment theretofore applied by any Person to its Guarantee is, or must be, rescinded or returned for any reason whatsoever, including, without limitation, the insolvency, bankruptcy or reorganization of the Issuer or any of the Subsidiary Guarantors, such Guarantee shall, to the extent that such payment is or must be rescinded or returned, be deemed to have continued in existence notwithstanding such application, and such Guarantee shall continue to be effective or be reinstated, as the case may be, as though such application had not been made.
50
(f) Each of the Subsidiary Guarantors shall be subrogated to all rights of the Holders and the Trustee against the Issuer and any other Subsidiary Guarantor in respect of any amounts paid by such first Subsidiary Guarantor pursuant to the provisions of this Indenture;
provided, however
, that such Subsidiary Guarantor shall not be entitled to enforce or to receive any payments arising out of, or based upon, such right of subrogation until all of the Securities of such series and the related Guarantees shall have been paid in full or discharged.
SECTION 10.02
Execution and Delivery of Guarantees.
To evidence its Guarantee set forth in Section 10.01, any Subsidiary Guarantor that is not a party to this Indenture shall execute and deliver a supplemental indenture in substantially the form attached hereto as Annex A. To further evidence its Guarantee set forth in Section 10.01, each of the Subsidiary Guarantors hereby agrees that a notation relating to such Guarantee (the “Notation of Guarantee”), substantially in the form attached hereto as Annex B, shall be endorsed on each Security of the series entitled to the benefits of such Guarantee authenticated and delivered by the Trustee, which Notation of Guarantee shall be executed by either manual or facsimile signature of an Officer of such Subsidiary Guarantor. Each of the Subsidiary Guarantors hereby agrees that its Guarantee set forth in Section 10.01 shall remain in full force and effect notwithstanding any failure to endorse on each Security the Notation of Guarantee relating to such Guarantee. If any Officer of such Subsidiary Guarantor, whose signature is on this Indenture, any supplemental indenture or the Notation of Guarantee, no longer holds that office at the time the Trustee authenticates such Security or at any time thereafter, the Guarantee of such Security shall be valid nevertheless. The delivery of any Security of a series entitled to the benefits of a Guarantee under this Article X by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Guarantee set forth in this Indenture on behalf of each Subsidiary Guarantor.
SECTION 10.03
Limitation on Liability of the Subsidiary Guarantors.
Each Subsidiary Guarantor and by its acceptance hereof each Holder of a Security of a series entitled to the benefits of a Guarantee under this Article X hereby confirms that it is the intention of all such parties that the guarantee by such Subsidiary Guarantor pursuant to its Guarantee not constitute a fraudulent transfer or conveyance for purposes of any federal or state law. To effectuate the foregoing intention, the Holders of a Security entitled to the benefits of such Guarantee and the Subsidiary Guarantors hereby irrevocably agree that the obligations of each Subsidiary Guarantor under its Guarantee shall be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Subsidiary Guarantor and to any collections from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under its Guarantee, result in the obligations of such Subsidiary Guarantor under its Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law.
SECTION 10.04
Release of Subsidiary Guarantors from Guarantee.
(a) Notwithstanding any other provisions of this Indenture, unless otherwise provided as contemplated by Section 2.01, the Guarantee of any Subsidiary Guarantor may be released upon the terms and subject to the conditions set forth in this Section 10.04. Provided
51
that no Default shall have occurred and shall be continuing under this Indenture, any Guarantee incurred by a Subsidiary Guarantor pursuant to this Article X shall be unconditionally released and discharged (i) in connection with sale, conveyance, assignment, transfer or other disposition of all or substantially all of the properties or assets of, or all of the Issuer’s direct or indirect limited partnership, limited liability company or other equity interests in, such Subsidiary Guarantor (including by way of merger or consolidation) to a Person that is not (either before or after giving effect to such transaction) an Affiliate of the Issuer; (ii) upon the merger of such Subsidiary Guarantor into the Issuer or any other Subsidiary Guarantor or the liquidation or dissolution of such Subsidiary Guarantor; (iii) upon satisfaction and discharge or covenant defeasance or legal defeasance with respect to the Notes as set forth in Section 8.01(a), (b) or (c); or (iv) following delivery of a written notice thereof by the Issuer to the Trustee, upon the release of all guarantees by such Subsidiary Guarantor under the Credit Facility; provided that, if, at any time following any release of such Subsidiary Guarantor from its initial Guarantee as described in this clause (iv), such Subsidiary Guarantor again provides a guarantee under the Credit Facility, then the Issuer will cause such Subsidiary Guarantor to again Guarantee the Securities in accordance herewith.
(b) The Trustee shall deliver an appropriate instrument evidencing any release of a Subsidiary Guarantor from its Guarantee upon receipt of a written request of the Issuer accompanied by an Officers’ Certificate and an Opinion of Counsel that the Subsidiary Guarantor is entitled to such release in accordance with the provisions of this Indenture. If the Subsidiary Guarantor is not so released, it shall remain liable for the full amount of principal of (and premium, if any, on) and interest on the Securities entitled to the benefits of such Guarantee as provided in this Indenture, subject to the limitations of Section 10.03.
SECTION 10.05
Contribution.
In order to provide for just and equitable contribution among the Subsidiary Guarantors, the Subsidiary Guarantors hereby agree,
inter se
, that in the event any payment or distribution is made by any Subsidiary Guarantor (a “Funding Guarantor”) under its Guarantee, such Funding Guarantor shall be entitled to a contribution from each other Subsidiary Guarantor (as applicable) in a pro rata amount based on the net assets of each Subsidiary Guarantor (including the Funding Guarantor) for all payments, damages and expenses incurred by that Funding Guarantor in discharging the Issuer’s obligations with respect to the Securities of a series entitled to the benefits of a Guarantee under this Article X or any other Subsidiary Guarantor’s obligations with respect to its Guarantee of such series of Securities.
SECTION 10.06
Guarantee for Benefit of Holders.
The Guarantee contained in this Indenture is entered into by each Subsidiary Guarantor for the benefit of the Holders from time to time of the Securities of a series entitled to the benefits of a Guarantee under this Article X. Such provisions shall not be deemed to create any right in, or to be in whole or in part for the benefit of, any Person other than the Trustee, the Subsidiary Guarantors, the Holders from time to time of such Securities and their permitted successors and assigns.
52
ARTICLE XI
MISCELLANEOUS
SECTION 11.01
Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by operation of TIA § 318(c), the imposed duties shall control.
SECTION 11.02
Notices.
Any notice or communication by the Issuer, any Subsidiary Guarantor or the Trustee to the others is duly given if in writing and delivered in person or mailed by first-class mail (registered or certified, return receipt requested), telex, facsimile or overnight air courier guaranteeing next day delivery, to the other’s address:
If to the Issuer or any Subsidiary Guarantor:
EQT Midstream Services, LLC
625 Liberty Avenue, Suite 1700
Pittsburgh, Pennsylvania 15222
Attn: General Counsel
Telephone: (412) 553-5700
Facsimile: (412) 553-5970
If to the Trustee:
The Bank of New York Mellon Trust Company, N.A.
525 William Penn Place, 38th Floor
Pittsburgh, Pennsylvania 15259
Attn: Corporate Trust Administration
Telephone: (412) 236-1215
Facsimile: (412) 234-7571
The Issuer, any Subsidiary Guarantor or the Trustee by notice to the others may designate additional or different addresses for subsequent notices or communications.
All notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if by facsimile; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery.
The Trustee agrees to accept and act upon instructions or directions pursuant to this Indenture sent by unsecured e-mail, pdf, facsimile transmission or other similar unsecured electronic methods;
provided, however
, that the Issuer shall provide the Trustee a list of persons designated to give such instructions or directions, which list shall be amended and replaced whenever a person is to be added or deleted therefrom. If the Issuer elects to give the Trustee e-
53
mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee in its discretion elects to act upon such instructions, the Trustee’s understanding of such instructions shall be deemed controlling. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such instructions notwithstanding that such instructions conflict or are inconsistent with a subsequent written instruction. The Issuer agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including, without limitation, the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties.
Any notice or communication to a Holder of a Global Security shall be transmitted in accordance with the Depositary’s applicable procedures, and any notice or communication to any other Holder shall be mailed by first-class mail, postage prepaid, to the Holder’s address shown on the register kept by the Registrar. Failure to give a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is given in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it, except in the case of notice to the Trustee, it is duly given only when received.
If the Issuer or a Subsidiary Guarantor transmits a notice or communication to Holders, it shall transmit a copy to the Issuer and the other Subsidiary Guarantors, as the case may be, and to the Trustee and each Agent at the same time.
All notices or communications, including, without limitation, notices to the Trustee, the Issuer or a Subsidiary Guarantor by Holders, shall be in writing, except as otherwise set forth herein.
In case by reason of the suspension of regular mail service, or by reason of any other cause, it shall be impossible to mail any notice required by this Indenture, then such method of notification as shall be made with the approval of the Trustee shall constitute a sufficient mailing of such notice.
SECTION 11.03
Communication by Holders with Other Holders.
Holders may communicate pursuant to TIA § 312(b) with other Holders with respect to their rights under this Indenture or the Securities. The Issuer, the Subsidiary Guarantors, the Trustee, the Registrar and anyone else shall have the protection of TIA § 312(c).
SECTION 11.04
Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuer or a Subsidiary Guarantor to the Trustee to take any action under this Indenture, the Issuer or such Subsidiary Guarantor, as the case may be, shall, if requested by the Trustee, furnish to the Trustee at the expense of the Issuer or such Subsidiary Guarantor, as the case may be:
54
(1) an Officers’ Certificate (which shall include the statements set forth in Section 11.05) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel (which shall include the statements set forth in Section 11.05 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with.
SECTION 11.05
Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA § 314(a)(4)) shall comply with the provisions of TIA § 314(e) and shall include:
(1) a statement that the Person making such certificate or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with.
SECTION 11.06
Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or the Paying Agent may make reasonable rules and set reasonable requirements for its functions.
SECTION 11.07
Legal Holidays.
If a payment date is a Legal Holiday at a Place of Payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.
SECTION 11.08
No Recourse Against Others.
Obligations of the Issuer and a Subsidiary Guarantor under this Indenture, the Securities and the related Guarantees, if any, are non-recourse to the General Partner and its Affiliates (other than the Issuer and such Subsidiary Guarantor), and payable only out of cash flow and assets of the Issuer and such Subsidiary Guarantor. The Trustee, and each Holder of a Security by its acceptance thereof, will be deemed to have agreed in this Indenture that (1) the
55
General Partner and its assets (and any of its Affiliates other than the Issuer and a Subsidiary Guarantor) shall not be liable for any of the obligations of the Issuer and a Subsidiary Guarantor under this Indenture, such Securities or such related Guarantees, and (2) no director, manager, member, officer, employee, stockholder, partner, unitholder or other owner of the Issuer, any Subsidiary Guarantor, the Trustee, the General Partner or any Affiliate of the foregoing entities shall have any liability in respect of the obligations of the Issuer and a Subsidiary Guarantor under this Indenture, such Securities or such related Guarantees by reason of his, her or its status. Each Holder by accepting a Security waives and releases all such liability. The waiver and release shall be part of the consideration for the issuance of Securities.
SECTION 11.09
Governing Law.
THIS INDENTURE, THE SECURITIES AND THE GUARANTEES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 11.10
No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt agreement of the Issuer, any Subsidiary Guarantor or any other Subsidiary of the Issuer. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 11.11
Successors.
All agreements of the Issuer and each of the Subsidiary Guarantors in this Indenture and the Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors.
SECTION 11.12
Severability.
In case any provision in this Indenture, in the Securities or in any Guarantee shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall, to the fullest extent permitted by applicable law, not in any way be affected or impaired thereby.
SECTION 11.13
Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
SECTION 11.14
Table of Contents, Headings, etc.
The table of contents, cross-reference table and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof.
56
SECTION 11.15
Waiver of Jury Trial.
EACH OF THE ISSUER, THE SUBSIDIARY GUARANTORS AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES, THE GUARANTEES, IF ANY, OR THE TRANSACTION CONTEMPLATED HEREBY.
SECTION 11.16
Submission of Jurisdiction.
The parties irrevocably submit to the non-exclusive jurisdiction of any competent New York State or federal court sitting in the Borough of Manhattan, City of New York, over any suit, action or proceeding arising out of or relating to this Indenture. To the fullest extent permitted by applicable law, each of the parties irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.
SECTION 11.17
Force Majeure.
In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
57
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the day and year first above written.
|
|
|
|
|
|
|
EQT MIDSTREAM PARTNERS, LP
|
|
|
|
By:
|
EQT Midstream Services, LLC,
|
|
|
its general partner
|
|
|
|
|
|
By:
|
/s/ Philip P. Conti
|
|
|
Name:
|
Philip P. Conti
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
EQUITRANS, L.P.
|
|
|
|
|
By: Equitrans Services, LLC,
|
|
|
its general partner
|
|
By: Equitrans Investments, LLC,
|
|
|
its sole member
|
|
By: EQT Midstream Partners, LP,
|
|
|
its sole member
|
|
|
By: EQT Midstream Services, LLC
|
|
|
its general partner
|
|
|
|
|
By:
|
/s/ Philip P. Conti
|
|
|
Name:
|
Philip P. Conti
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
|
EQUITRANS INVESTMENTS, LLC
|
|
|
|
|
By:
|
EQT Midstream Partners, LP,
|
|
|
its sole member
|
|
|
|
|
By:
|
EQT Midstream Services, LLC,
|
|
|
its general partner
|
|
|
|
|
|
|
|
|
By:
|
/s/ Philip P. Conti
|
|
|
Name:
|
Philip P. Conti
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
|
Signature Page to Indenture
|
|
|
|
|
|
EQUITRANS SERVICES, LLC
|
|
|
|
By:
|
Equitrans Investments, LLC,
|
|
|
its sole member
|
|
|
|
|
By:
|
EQT Midstream Partners, LP,
|
|
|
its sole member
|
|
|
|
|
By:
|
EQT Midstream Services, LLC,
|
|
|
its general partner
|
|
|
|
|
|
|
|
|
By:
|
/s/ Philip P. Conti
|
|
|
Name:
|
Philip P. Conti
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
EQM GATHERING HOLDINGS, LLC
|
|
|
|
|
By:
|
EQT Midstream Partners, LP,
|
|
|
its sole member
|
|
|
|
|
By:
|
EQT Midstream Services, LLC,
|
|
|
its general partner
|
|
|
|
|
|
|
|
|
By:
|
/s/ Philip P. Conti
|
|
|
Name:
|
Philip P. Conti
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|
Signature Page to Indenture
|
|
|
|
|
|
EQM GATHERING OPCO, LLC
|
|
|
|
By:
|
EQM Gathering Holdings, LLC,
|
|
|
its sole member
|
|
|
|
|
By:
|
EQT Midstream Partners, LP,
|
|
|
its sole member
|
|
|
|
|
By:
|
EQT Midstream Services, LLC,
|
|
|
its general partner
|
|
|
|
|
|
|
|
|
By:
|
/s/ Philip P. Conti
|
|
|
Name:
|
Philip P. Conti
|
|
|
Title:
|
Senior Vice President and Chief Financial Officer
|
Signature Page to Indenture
|
|
|
|
|
|
|
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
|
|
|
|
|
|
By:
|
/s/ R. Tarnas
|
|
Name:
|
R. Tarnas
|
|
Title:
|
Vice President
|
|
|
|
|
|
Signature Page to Indenture
ANNEX A
FORM OF SUPPLEMENTAL INDENTURE TO BE DELIVERED
BY SUBSEQUENT SUBSIDIARY GUARANTORS
THIS
[
]
SUPPLEMENTAL INDENTURE, dated as of
[
]
(this “Supplemental Indenture”), is among
[
]
(the “New Subsidiary Guarantor”), EQT Midstream Partners, LP, a Delaware limited partnership (the “Issuer”), each other then-existing Subsidiary Guarantors under the Indenture referred to below (the “Existing Subsidiary Guarantors”) and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) under the Indenture.
W I T N E S S E T H:
WHEREAS, the Issuer, the Existing Subsidiary Guarantors and the Trustee have heretofore executed and delivered an Indenture, dated as of August 1, 2014 (as amended, supplemented, waived or otherwise modified, the “Indenture”), providing for the issuance from time to time of the Issuer’s debentures, notes, bonds or other evidences of indebtedness (the “Securities”), which are to be issued in one or more series.
WHEREAS, Section 10.02 of the Indenture provides that any Subsidiary Guarantor that is not a party to the Indenture shall execute and deliver a supplemental indenture to evidence its Guarantee set forth in Section 10.01 of the Indenture.
WHEREAS, pursuant to Section 9.01(4) of the Indenture, the Trustee, the Issuer and the Subsidiary Guarantors are authorized to execute and deliver this Supplemental Indenture to amend or supplement the Indenture, without the consent of any Holder, to add any guarantees of or additional obligors on any series of Securities.
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Subsidiary Guarantor, the Issuer, the Existing Subsidiary Guarantors and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of any series of Securities designated pursuant to the Indenture as entitled to the benefits of a Guarantee by the New Subsidiary Guarantor (collectively, the “Guaranteed Securities”) as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01
Defined Terms
. As used in this Supplemental Indenture, capitalized terms defined in the Indenture or in the preamble or recitals thereto are used herein as therein defined. The words “herein,” “hereof” and “hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.
A-1
ARTICLE 2
AGREEMENT TO BE BOUND; GUARANTEE
SECTION 2.01
Agreement to be Bound
. The New Subsidiary Guarantor hereby becomes a party to the Indenture as a Subsidiary Guarantor with respect to the Guaranteed Securities and as such shall have all of the rights and be subject to all of the obligations and agreements of such a Subsidiary Guarantor under the Indenture. The New Subsidiary Guarantor agrees to be bound by all of the provisions of the Indenture applicable to such a Subsidiary Guarantor and to perform all of the obligations and agreements of such a Subsidiary Guarantor under the Indenture.
ARTICLE 3
MISCELLANEOUS
SECTION 3.01
Relation to the Indenture
. The provisions of this Supplemental Indenture shall become effective immediately upon the execution and delivery hereof. This Supplemental Indenture and all the terms and provisions herein contained shall form a part of the Indenture as fully and with the same effect as if all such terms and provisions had been set forth in the Indenture;
provided, however
, such terms and provisions shall be so included in this Supplemental Indenture solely for the benefit of the Issuer, the Subsidiary Guarantors, the Trustee and the Holders of the Guaranteed Securities. The Indenture is hereby ratified and confirmed and shall remain and continue in full force and effect in accordance with the terms and provisions thereof, as supplemented by this Supplemental Indenture, and the Indenture and this Supplemental Indenture shall be read, taken and construed together as one instrument.
SECTION 3.02
Effect of Supplemental Indenture
. The supplements to the Indenture set forth in this Supplemental Indenture affect only the provisions of the Indenture as such provisions relate to the Guaranteed Securities, the series of Securities comprised of the Guaranteed Securities and the rights, remedies and obligations of the Issuer, the Subsidiary Guarantors, the Holders of Guaranteed Securities, the Trustee and other Persons set forth in the Indenture as such rights, remedies and obligations relate to the Guaranteed Securities, and shall not affect any such provisions or otherwise create any such rights, remedies and obligations with respect to any other series of Securities.
SECTION 3.03
Counterparts of Supplemental Indenture
. This Supplemental Indenture may be executed in several counterparts, each of which shall be deemed an original, but all of which together shall constitute one instrument.
SECTION 3.04
Governing Law
. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 3.05
No Responsibility of Trustee for Recitals, Etc
. The recitals and statements contained in this Supplemental Indenture shall be taken as the recitals and statements of the Issuer and the Subsidiary Guarantors, and the Trustee assumes no responsibility for the correctness of the same. The Trustee makes no representations as to the validity or sufficiency
A-2
of this Supplemental Indenture, except that the Trustee is duly authorized by all necessary corporate actions to execute and deliver this Supplemental Indenture.
A-3
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the day and year first above written.
|
|
|
|
|
|
EQT MIDSTREAM PARTNERS, LP
|
|
|
|
By:
|
EQT Midstream Services, LLC,
|
|
|
its General Partner
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Name:
|
|
|
|
Title:
|
|
|
|
|
|
|
|
[
EXISTING GUARANTORS
]
|
|
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
[
NEW GUARANTOR
]
,
|
|
as a Guarantor
|
|
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
|
|
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
A-4
ANNEX B
FORM OF NOTATION OF GUARANTEE
Each of the Subsidiary Guarantors (which term includes any successor Person under the Indenture) has fully, unconditionally and absolutely guaranteed, to the extent set forth in the Indenture and subject to the provisions in the Indenture, the due and punctual payment of the principal of, and premium, if any, and interest on the Securities and all other amounts due and payable under the Indenture and the Securities by the Issuer.
The obligations of the Subsidiary Guarantors to the Holders of Securities and to the Trustee pursuant to the Guarantee and the Indenture are expressly set forth in Article X of the Indenture and reference is hereby made to the Indenture for the precise terms of the Guarantee.
|
|
|
|
|
|
[
SUBSIDIARY GUARANTORS
]
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
B-1
Exhibit 10.01
Portions of this Exhibit have been redacted pursuant to a request for confidential treatment under Rule 24b-2 of the General Rules and Regulations under the Securities Exchange Act. Omitted information marked “[***]” in this Exhibit has been filed with the Securities and Exchange Commission together with such request for confidential treatment.
Execution Copy
FIRST AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF
MOUNTAIN VALLEY PIPELINE, LLC
A Delaware Limited Liability Company
August 28, 2014
TABLE OF CONTENTS
Article 1 DEFINITIONS
1
Article 2 ORGANIZATION
18
|
|
2.03
|
Registered Office; Registered Agent; Principal Office in the
|
United States; Other Offices 18
|
|
2.05
|
No State Law Partnership 18
|
|
|
2.06
|
Foreign Qualification 18
|
|
|
2.08
|
Title to Property 19
|
Article 3 MEMBERSHIP INTERESTS; DISPOSITIONS OF INTERESTS
19
|
|
3.01
|
Capital Structure 19
|
|
|
3.02
|
Representations, Warranties and Covenants. 20
|
|
|
3.03
|
Dispositions and Encumbrances of Membership Interests. 22
|
|
|
3.04
|
Creation of Additional Membership Interests 36
|
|
|
3.05
|
Access to Information 36
|
|
|
3.06
|
Confidential Information 37
|
|
|
3.07
|
Founding Shippers 39
|
|
|
3.08
|
Liability to Third Parties 39
|
|
|
3.09
|
Use of Members’ Names and Trademarks 39
|
Article 4 CAPITAL CONTRIBUTIONS/LOANS
39
|
|
4.01
|
Capital Contributions 39
|
|
|
4.03
|
No Other Contribution or Loan Obligations 44
|
|
|
4.04
|
Return of Contributions 44
|
|
|
4.06
|
Failure to Make a Capital Contribution or Loan. 45
|
|
|
4.07
|
Credit Assurance. 48
|
Article 5 DISTRIBUTIONS AND ALLOCATIONS
49
|
|
5.02
|
[Intentionally omitted.] 49
|
|
|
5.03
|
[Intentionally omitted.] 49
|
|
|
5.04
|
Allocations for Maintaining Capital Accounts 49
|
|
|
5.05
|
Allocations for Tax Purposes 51
|
|
|
5.06
|
Varying Interests 52
|
Article 6 MANAGEMENT
53
|
|
6.02
|
Management Committee 53
|
|
|
6.03
|
Construction, Operation and Management Agreement 60
|
|
|
6.04
|
No Duties; Disclaimer of Duties 60
|
|
|
6.05
|
Business Opportunities. 61
|
|
|
6.06
|
Insurance Coverage. 63
|
|
|
6.08
|
Limitation on Liability 64
|
|
|
6.09
|
Delivery of Operating Budget 65
|
Article 7 DEVELOPMENT OF FACILITIES
65
|
|
7.01
|
Development of Facilities. 65
|
|
|
7.03
|
General Regulatory Matters. 67
|
Article 8 TAXES
67
|
|
8.03
|
Tax Matters Member 68
|
Article 9 BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
69
|
|
9.01
|
Maintenance of Books 69
|
Article 10 WITHDRAWAL
71
|
|
10.01
|
Right of Withdrawal 71
|
|
|
10.02
|
Deemed Withdrawal 71
|
|
|
10.03
|
Effect of Withdrawal 72
|
Article 11 DISPUTE RESOLUTION
73
|
|
11.02
|
Negotiation to Resolve Disputes 74
|
|
|
11.04
|
Specific Performance 74
|
Article 12 DISSOLUTION, WINDING-UP AND TERMINATION
76
|
|
12.02
|
Winding-Up and Termination 77
|
|
|
12.03
|
Deficit Capital Accounts 79
|
|
|
12.04
|
Certificate of Cancellation 79
|
Article 13 GENERAL PROVISIONS
79
|
|
13.01
|
Offset; Costs and Expenses 79
|
|
|
13.03
|
Entire Agreement; Superseding Effect 79
|
|
|
13.04
|
Effect of Waiver or Consent 80
|
|
|
13.05
|
Amendment or Restatement 80
|
|
|
13.07
|
Governing Law; Severability 80
|
|
|
13.08
|
Further Assurances 80
|
|
|
13.09
|
Waiver of Certain Rights 81
|
|
|
13.11
|
Fair Market Value Determination. 81
|
|
|
13.12
|
Other Agreements 81
|
EXHIBIT
:
A - Members and Sharing Ratios in Series A
B - Form of Limited Liability Company Agreement
FIRST AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF
MOUNTAIN VALLEY PIPELINE, LLC
This FIRST AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF MOUNTAIN VALLEY PIPELINE, LLC (this “
Agreement
”), dated as of August 28, 2014 (the “
Effective Date
”), is adopted, executed and agreed to by MVP Holdco, LLC, a Delaware limited liability company (“
EQT
”), US Marcellus Gas Infrastructure, LLC, a Delaware limited liability company (“
USG
”), and Mountain Valley Pipeline, LLC, a Delaware limited liability company (the “
Company
”) and each Person from time to time admitted to the Company as a Member in accordance with the terms hereof.
RECITALS
WHEREAS, on August 22, 2014, the Company was formed as a “series” limited liability company in accordance with the Act (as hereinafter defined) for the purpose of developing, constructing, owning and operating an interstate natural gas pipeline and related facilities and EQT, as the Company’s initial member, entered into a written agreement governing the affairs of the Company and the conduct of its business (the “
Initial Agreement
”); and
WHEREAS, EQT, as the Company’s initial member, wishes to amend and restate the Initial Agreement in its entirety in connection with the admission of USG as a Member and in order to make certain provisions regarding the affairs of the Company and the conduct of its business and the rights and obligations of the parties hereto on the terms and subject to the conditions set forth herein.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, EQT and USG agree as follows:
Article 1
DEFINITIONS
|
|
1.01
|
Definitions
. As used in this Agreement, the following terms have the respective meanings set forth below or set forth in the Sections referred to below:
|
708(b) Members
– has the meaning set forth in Section 3.03(b)(viii).
AAA
– has the meaning set forth in Section 11.05(a).
Act
– means the Delaware Limited Liability Company Act.
Additional Contribution/Loan
– has the meaning set forth in Section 4.06(a)(ii).
Additional Contribution/Loan Members
– has the meaning set forth in Section 4.06(a)(ii).
Additional Facility
– has the meaning set forth in Section 6.05(a).
Additional Joint Venture LLC
– has the meaning set forth in Section 6.02(i)(JJ).
Adjusted Capital Account
– means, with respect to each Series, the Capital Account maintained for each Member as provided in Section 4.05, (a) increased by (i) an amount equal to such Member’s allocable share of Minimum Gain with respect to such Series as computed in accordance with the applicable Treasury Regulations, and
(ii) the amount that such Member is deemed to be obligated to restore with respect to such Series pursuant to Treasury Regulations Section 1.704-1(b)(2)(ii)(c), if any, and (b) reduced by the adjustments provided for in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4)-(6) with respect to such Series. The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
Affiliate
– means, (i) with respect to any Person, (a) each entity that such Person Controls; (b) each Person that Controls such Person, including, in the case of a Member, such Member’s Parent; and (c) each entity that is under common Control with such Person, including, in the case of a Member, each entity that is Controlled by such Member’s Parent;
provided
that, with respect to any Member, an Affiliate shall include (y) a limited partnership or a Person Controlled by a limited partnership if such Member’s Parent has the power to appoint the general partner of such limited partnership, or such general partner is otherwise is Controlled by such Member’s Parent, or (z) a limited liability company or a Person controlled by a limited liability company if such Member’s Parent has the power to appoint the managing member or manager (or, if more than one manager, a majority of managers) of the limited liability company, or such managing member or manager(s) are Controlled by such Member’s Parent;
provided
,
further
, that, for purposes of this Agreement, the Company shall not be an Affiliate of any Member; and (ii) [***].
Affiliate’s Outside Activities
– has the meaning set forth in Section 6.05(a).
Agreement
– has the meaning set forth in the Preamble.
Alternate Representative
– has the meaning set forth in Section 6.02(a)(i).
Appraiser
– has the meaning set forth in Section 13.11(c).
Approval Date
– means (i) with respect to Series A, the Effective Date, and (ii) with respect to each additional Series or Additional Joint Venture LLC, the date an Additional Facility is approved pursuant to Section 6.05(a) and assigned by the Management Committee to such additional Series or Additional Joint Venture LLC.
Approved Precedent Agreement
– means each Precedent Agreement approved by the Management Committee pursuant to Section 6.02(i)(S).
Arbitration
– has the meaning set forth in Section 11.05(a).
Arbitration Invoking Party
– has the meaning set forth in Section 11.05(b).
Arbitration Notice
– has the meaning set forth in Section 11.05(b).
Arbitration Noticed Party
– has the meaning set forth in Section 11.05(b).
Assignee
– means any Person that acquires a Membership Interest or any portion thereof through a Disposition;
provided
that an Assignee shall have no right to be admitted to the Company as a Member except in accordance with Section 3.03(b)(iii). Subject to the Preferential Rights set forth in Section 3.03(b)(ii), the Assignee of a dissolved Member is the shareholder, partner, member or other equity owner or owners of the dissolved Member to whom such Member’s Membership Interest is assigned by the Person conducting the liquidation or winding-up of such Member. The Assignee of a Bankrupt Member is (a) the Person or Persons (if any) to whom such Bankrupt Member’s Membership Interest is assigned by order of the bankruptcy court or other Governmental Authority having jurisdiction
over such Bankruptcy, or (b) in the event of a general assignment for the benefit of creditors, the creditor to which such Membership Interest is assigned.
Assumed Tax Rate
– means, for any period, the effective maximum combined marginal U.S. federal, state, and local income tax rate applicable to ordinary income of an individual resident of New York, New York, after giving effect to any U.S. federal income tax deduction for state and local income taxes.
Authorizations
– means licenses, certificates, permits, orders, approvals, determinations and authorizations from Governmental Authorities having valid jurisdiction.
Available Cash
– means, with respect to each Series and with respect to any Quarter ending prior to the termination or liquidation of the Series, and without duplication:
(a) the sum of all cash and cash equivalents with respect to such Series on hand at the end of such Quarter, less
(b) the amount of any cash reserves with respect to such Series that is necessary or appropriate in the reasonable discretion of the Management Committee (i) to provide for the proper conduct of the business of the Series (including reserves for future maintenance capital expenditures and for anticipated future credit needs of the Series) subsequent to such Quarter or (ii) to comply with applicable law or any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation to which the Company with respect to such Series is a party or by which it is bound or its assets are subject.
Notwithstanding the foregoing, “Available Cash” with respect to the Quarter in which a liquidation or termination of the Series occurs and any subsequent Quarter shall be deemed to equal zero.
Bankruptcy
or
Bankrupt
– means, with respect to any Person, that (a) such Person (i) makes a general assignment for the benefit of creditors; (ii) files a voluntary bankruptcy petition; (iii) becomes the subject of an order for relief or is declared insolvent in any federal or state bankruptcy or insolvency proceedings; (iv) files a petition or answer seeking for such Person a reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any Law; (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against such Person in a proceeding of the type described in subclauses (i) through (iv) of this clause (a); or (vi) seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator of such Person or of all or any substantial part of such Person’s properties; or (b) against such Person, a proceeding seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any Law has been commenced and 120 Days have expired without dismissal thereof or with respect to which, without such Person’s consent or acquiescence, a trustee, receiver, or liquidator of such Person or of all or any substantial part of such Person’s properties has been appointed and 90 Days have expired without the appointment’s having been vacated or stayed, or 90 Days have expired after the date of expiration of a stay, if the appointment has not previously been vacated.
Breaching Member
– means a Member that, as of any date, (a) has committed a failure or breach of the type described in the definition of “Default,” (b) has received a written notice with respect to such failure or breach of the type described in such definition of “Default,” and (c) has not cured such failure or breach as of such date, but as to which the applicable cure period set forth in such definition of “Default” has not then expired.
Business Day
– means any day other than a Saturday, a Sunday, or a holiday on which national banking associations in the State of Delaware are closed.
[***]
Capital Account
– means, with respect to each Series, the account maintained by the Company for each Member in accordance with Section 4.05.
Capital Budget
– means, with respect to each Series, (a) the Construction Budget for the Series, (b) the capital budget associated with the Facilities covered by any Approved Precedent Agreement for the Series, and (c) the annual capital budget for the Series that is approved (or deemed approved) pursuant to Section 6.02(i)(GG). Each Capital Budget shall cover all items that are classified as capital items under Required Accounting Practices.
Capital Call
– has the meaning set forth in Section 4.01(a)(iv).
Capital Contribution
– means, with respect to each Series, the amount of money and the net agreed fair market value of any property (other than money) contributed to the Company with respect to the Series by the Member. Any reference in this Agreement to the Capital Contribution of a Member shall include a Capital Contribution of its predecessors in interest.
Certified Public Accountants
– means a firm of independent public accountants selected from time to time by the Management Committee.
Change of Control
– means:
(a) with respect to any Member, an event (such as a Disposition of voting securities or other equity interests or substantially all the assets of such Member) that causes such Member to cease to be Controlled by such Member’s then Parent;
provided
that the term “Change of Control” shall not include any of the following events:
(A) with respect to a Founding Member, an event that causes such Member’s then Parent to be Controlled by another Person;
(B) a Disposition of the Membership Interests held by, or the equity or assets of, such Member to an Affiliate of such Member or such Member’s then Parent, or any other event, including any corporate reorganization, merger, combination or similar transaction, that results in such Member being Controlled by an Affiliate of such Member’s then Parent, including, in each case, a Disposition to a limited partnership whose general partner is Controlled by an Affiliate of such Member or its then Parent;
(C) in the case of a Member that is a publicly traded partnership or is Controlled by a publicly traded partnership, any Disposition of units or issuance of new units representing limited partner interests by such publicly traded partnership, whether to an Affiliate or an unrelated party and whether or not such units or interests are listed on a national securities exchange or quotation service so long as the general partner of such publicly traded partnership is Controlled by an Affiliate of such Member or its Parent; and
(D) [***];
(b) prior to and following the In-Service Date, with respect to the Operator, an event (such as a Disposition of voting securities or other equity interests of substantially all the assets of the Operator)
that causes, directly or indirectly, the Operator to be Controlled by another Person, subject to Section 3.03(b)(vi)(D). With respect to the Operator, “Change of Control” shall not include an event (i) that causes the Operator to be Controlled by an Affiliate of the Operator or an Affiliate of the Operator’s then Parent or (ii) that causes the Parent of the Operator to be Controlled by another Person so long as [***]; and
(c) Notwithstanding the foregoing, and for the avoidance of doubt, any event that (i) constitutes a Change of Control under clause (a) of this definition of Change of Control or (ii) is expressly excluded from this definition of Change of Control pursuant to clauses (a)(A), (a)(B), (a)(C) or (a)(D) above shall not be deemed a Disposition for purposes of Section 3.03 of this Agreement, other than for purposes of Section 3.03(b)(iv);
provided
,
however
, that Dispositions or issuances described in clause (a)(C) shall not be deemed a Disposition for purposes of Section 3.03(b)(iv).
Change Exercise Notice
– has the meaning set forth in Section 3.03(b)(vi)(A).
Change Purchasing Member
– has the meaning set forth in Section 3.03(b)(vi)(A).
Change Unexercised Portion
– has the meaning set forth in Section 3.03(b)(vi)(A).
Changing Member
– has the meaning set forth in Section 3.03(b)(vi)(A).
Claim
– means any and all judgments, claims, causes of action, demands, lawsuits, suits, proceedings, Governmental investigations or audits, losses, assessments, fines, penalties, administrative orders, obligations, costs, expenses, liabilities and damages (whether actual, consequential or punitive), including interest, penalties, reasonable attorney’s fees, disbursements and costs of investigations, deficiencies, levies, duties, imposts, remediation and cleanup costs, and natural resources damages.
Code
– means the Internal Revenue Code of 1986, as amended.
COM Agreement
– has the meaning set forth in Section 6.03.
COM Approval Matters
– means all matters requiring the approval of the Company or providing for the exercise of rights by the Company, including, without limitation, those set forth in Sections 3.1, 3.2, 3.4, 3.5, 3.6, 4.2, 4.4, 5.1, 5.2, 7.1(b), 7.2, 8.2, and 8.3, Article 9, Sections 13.2 and 13.4, Article 15, Article 17, Section 18.6 and 18.9, Exhibit A, and Exhibit B of the COM Agreement.
Comment Deadline
– has the meaning set forth in Section 6.09.
Company
– has the meaning set forth in the Preamble.
Confidential Information
– means all information and data (including all copies thereof) that is furnished or submitted by any of the Members, their Affiliates, or Operator, whether oral, written, or electronic, to the other Members, their Affiliates, or Operator in connection with the Facilities and the resulting information and data obtained from those studies, including market evaluations, market proposals, service designs and pricing, pipeline system design and routing, cost estimating, rate studies, identification of permits, strategic plans, legal documents, environmental studies and requirements, public and governmental relations planning, identification of regulatory issues and development of related strategies, legal analysis and documentation, financial planning, gas reserves and deliverability data, studies of the natural gas supplies for the Facilities, and other studies and activities to determine
the potential viability of the Facilities and their design characteristics, and identification of key issues. Notwithstanding the foregoing, the term “Confidential Information” shall not include any information that:
(a) is in the public domain at the time of its disclosure or thereafter, other than as a result of a disclosure directly or indirectly by a Member or its Affiliates in contravention of this Agreement;
(b) as to any Member or its Affiliates, was in the possession of such Member or its Affiliates prior to the execution of this Agreement and not subject to a separate confidentiality restriction;
(c) has been independently acquired or developed by a Member or its Affiliates without violating any of the obligations of such Member or its Affiliates under this Agreement; or
(d) is received from a third-party source on a non-confidential basis, provided that such third-party source is not subject to an obligation of confidentiality and would not reasonably have been expected to know that the information was to be kept confidential from the applicable party.
Construction Budget
– has the meaning set forth in Section 4.01(a)(i).
Contributing/Loan Member
– has the meaning set forth in Section 4.06(a).
Control, Controls or Controlled
– means the possession, directly or indirectly, through one or more intermediaries, of the following:
(a) (i) in the case of a corporation, 50% or more of the outstanding voting securities thereof; (ii) in the case of a limited liability company, general partnership or venture, the right to 50% or more of the distributions therefrom (including liquidating distributions); (iii) in the case of a trust or estate, including a statutory trust, 50% or more of the beneficial interest therein; (iv) in the case of a limited partnership (A) the right to 50% or more of the distributions therefrom (including liquidating distributions), (B) where the general partner of such limited partnership is a corporation, ownership of 50% or more of the outstanding voting securities of such corporate general partner, (C) where the general partner of such limited partnership is a partnership, limited liability company or other entity (other than a corporation or limited partnership), the right to 50% or more of the distributions (including liquidating distributions) from such general partner entity, or (D) where the general partner of such limited partnership is a limited partnership, Control of the general partner of such general partner in the manner described under subclause (B) or (C) of this clause, or (v) in the case of any other entity, 50% or more of the economic or beneficial interest therein; or
(b) in the case of any entity, the power or authority, through ownership of voting securities, by contract or otherwise, to exercise predominant control over the management of the entity.
Control Notice
– has the meaning set forth in Section 3.03(b)(vi)(A).
Covered Person
– has the meaning set forth in Section 6.07(a).
Credit Assurance
– has the meaning set forth in Section 4.07(a).
Day
– means a calendar day,
provided
that if any period of Days referred to in this Agreement shall end on a Day that is not a Business Day, then the expiration of such period shall be automatically extended until the end of the next occurring Business Day.
Deadlock
– has the meaning set forth in Section 11.01.
December Deadline
– has the meaning set forth in Section 6.09.
Deemed Membership Disposition
– means, with respect to any Membership Interest that is owned by a Person, the primary assets of which comprise such Membership Interest and assets that are directly related thereto, a Disposition of all of the voting securities or other equity interests of such Person.
Default
– means, with respect to any Member:
(a) the failure of such Member to contribute, within [***] Days of the date required pursuant to Section 4.06, all or any portion of a Capital Contribution that such Member is required to make as provided in this Agreement; or
(b) the failure of a Member to comply in any material respect with any of its other agreements, covenants or obligations under this Agreement, or the failure of any representation or warranty made by a Member in this Agreement to have been true and correct in all material respects at the time it was made;
in the case of each of clause (a) and (b) above if such breach is not cured by the applicable Member within [***] Days of its receiving written notice of such breach from any other Member (or, if a breach of clause (b) is not capable of being cured within such [***]-Day period, if such Member fails to promptly commence substantial efforts to cure such breach or to prosecute such curative efforts to completion with continuity and diligence). The Management Committee may, but shall have no obligation to, extend the foregoing [***]-Day and [***]-Day periods, as determined in its Sole Discretion.
Default Rate
– means a rate per annum equal to the lesser of (a) a varying rate per annum equal to the sum of (i) the prime rate as published in
The Wall Street Journal
, with adjustments in that varying rate to be made on the same date as any change in that rate is so published,
plus
(ii) [***]% per annum, and (b) the maximum rate permitted by Law.
Delaware Certificate
– means the Certificate of Formation of the Company that was filed with the Office of the Secretary of State of Delaware on August 22, 2014.
Delaware Courts
– has the meaning set forth in Section 11.03.
Demand Event
– has the meaning set forth in Section 4.07(b).
Diluted Member
– has the meaning set forth in Section 3.02(b)(ii)(B).
Dispose
,
Disposing
, or
Disposition
– means, with respect to any asset (including a Membership Interest or any portion thereof), a sale, assignment, transfer, conveyance, gift, exchange or other disposition of such asset, whether such disposition be voluntary, involuntary or by operation of Law (and, with respect to a Membership Interest, any derivative or similar arrangement whereby a portion or all of the economic interests in, or risk of loss or opportunity for gain with respect to, such Membership Interest is transferred or shifted to another Person), including the following: (a) in the case of an asset owned by a natural person, a transfer of such asset upon the death of its owner, whether by will, intestate succession or otherwise; (b) in the case of an asset owned by an entity, (i) a merger or consolidation of such entity (other than where such entity is the survivor thereof) or (ii) a distribution of such asset by
such entity to its shareholders, partners, members, or other equity owners, including in connection with the dissolution, liquidation, winding-up or termination of such entity (unless, in the case of dissolution, such entity’s business is continued without the commencement of liquidation or winding-up); and (c) a disposition in connection with, or in lieu of, a foreclosure of an Encumbrance; but such terms shall not include the creation of an Encumbrance.
Disposing Member
– has the meaning set forth in Section 3.03(b)(ii)(A).
Disposition Notice
– has the meaning set forth in Section 3.03(b)(ii)(A).
Dispute
– has the meaning set forth in Section 11.01.
Disputing Member
– has the meaning set forth in Section 11.01.
Dissolution Event
– has the meaning set forth in Section 12.01(b).
Economic Risk of Loss
– has the meaning assigned to that term in Treasury Regulation Section 1.752-2(a).
Effective Date
– has the meaning set forth in the Preamble.
Encumber
,
Encumbering
, or
Encumbrance
– means the creation of a security interest, lien, pledge, mortgage or other encumbrance, other than a Permitted Encumbrance, whether such encumbrance be voluntary, involuntary or by operation of Law.
EQM
– means EQT Midstream Partners, LP, a Delaware limited partnership.
EQT
– has the meaning set forth in the Preamble.
Facilities
– means the facilities comprised of (a) the Initial Facilities; and (b) any Additional Facility approved pursuant to Section 6.05(a).
Fair Market Value
– means (i) the fair market cash value of the Membership Interest of the Changing Member as determined pursuant to the terms of Section 13.11(b) or (c), as applicable, or (ii) the fair market cash value of the consideration to be paid to the Disposing Member pursuant to the proposed Disposition as determined pursuant to the terms of Section 13.11(a) or (c), as applicable.
FERC
– means the Federal Energy Regulatory Commission or any Governmental Authority succeeding to the powers of such commission.
FERC Application
– means the document pursuant to which application for a certificate(s) of public convenience and necessity is made under Section 7 of the NGA to the FERC by a Series of the Company for authority to construct, own, acquire, and operate, and provide service on the Facilities assigned to such Series.
FERC Certificate
– means the certificate(s) of public convenience and necessity issued by the FERC pursuant to any FERC Application.
FERC Response Date
– means the date that is 30 Days following the date upon which the FERC has issued the applicable FERC Certificate.
Financing Commitment
– means the definitive agreements between one or more financial institutions or other Persons and the Company or the Financing Entity pursuant to which such financial institutions or other Persons agree, subject to the conditions set forth therein, to lend money to, or purchase securities of, the Company or the Financing Entity, the proceeds of which shall be used to finance all or a portion of the Facilities or to repay loans made by the Members pursuant to Section 4.02.
Financing Entity
– means a corporation, limited liability company, trust, or other entity that may be organized for the purpose of issuing securities, the proceeds from which are to be advanced directly or indirectly to the Company to finance all or a portion of the Facilities.
FMV Notice
– has the meaning set forth in Section 13.11(c).
Founding Members
– means, with respect to any Series, EQT, USG and any of their respective Affiliates that are Members (and any limited partnership or master limited partnership to which such Members’ Membership Interests have been assigned pursuant to Section 3.03(e) or Section 3.03(f) of this Agreement); [***].
Founding Shippers
– means the Affiliate of EQT and the Affiliate of USG that, in each case, enters into a Precedent Agreement to provide a commitment for firm transportation [***].
FPL
– has the meaning set forth in Section 6.05(f).
GAAP
– means United States generally accepted accounting principles.
Gas Transportation Service Agreements
– means the gas transportation service agreements by and between the Company or its designee and the Shippers for the transportation of natural gas through the Facilities.
[***]
Governmental Authority
(or
Governmental
) – means a federal, state, local or foreign governmental authority; a state, province, commonwealth, territory or district thereof; a county or parish; a city, town, township, village or other municipality; a district, ward or other subdivision of any of the foregoing; any executive, legislative or other governing body of any of the foregoing; any agency, authority, board, department, system, service, office, commission, committee, council or other administrative body of any of the foregoing; including the FERC, any court or other judicial body; and any officer, official or other representative of any of the foregoing.
including –
means including, without limitation.
Indebtedness
– means any amount (absolute or contingent) payable by the Company or any Series as debtor, borrower, issuer, guarantor or otherwise, pursuant to (a) an agreement or instrument involving or evidencing money borrowed, the advance of credit, a conditional sale or a transfer with recourse or with an obligation to repurchase; (b) indebtedness of a third party guaranteed by or secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any lien on assets owned or acquired by, the Company or any Series, whether or not the indebtedness secured thereby has been assumed; (c) purchase-money indebtedness and capital lease obligations; (d) an interest rate protection agreement, foreign currency exchange agreement or other hedging arrangement; or (e) a letter of credit issued for the account of the Company or any Series.
Independent Accounting Firm
– has the meaning set forth in Section 3.03(b)(viii).
Initial Agreement
– has the meaning set forth in the Recitals.
Initial Facilities
- means (a) approximately 330 miles of pipeline expected to be between 36 and 42 inches in diameter and certain compression facilities, as described in the FERC Application for such facilities, if and as amended from time to time, together with any upgrades thereto, extending from the tailgate of the MarkWest Mobley plant in Smithfield, West Virginia to Transco Station 165 near Chatham, Virginia; (b) [***]; (c) installing or upgrading any compression with respect to the facilities described in clause (a) above; and (d) [***].
Initial Operating Budget
– has the meaning set forth in Section 4.01(a)(i).
Initial Release
– has the meaning set forth in Section 4.01(b)(i).
Investment Grade
– means, with respect to any Person, having debt rated as investment grade by at least two of the three nationally-recognized ratings agencies, being at least [***] for Moody’s Investor Services and at least [***] for each of Standard & Poor’s and Fitch Ratings.
In-Service Date
– means, with respect to each Series, the date of the placing of the Facilities owned by or with respect to such Series in service. On, or as promptly as practicable after, such date, the Operator shall notify the Members of its occurrence.
Law
– means any applicable constitutional provision, statute, act, code (including the Code), law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision, declaration, or interpretative or advisory opinion or letter of a Governmental Authority having valid jurisdiction.
Letter of Credit
– means an irrevocable, unconditional, transferable standby letter of credit in form and substance satisfactory to the Management Committee for the benefit of the Company or any Series, issued by a United States bank or a foreign bank with a United States branch, with United States based assets of at least $10,000,000,000 and a rating of [***] or better from Standard & Poor’s Ratings Service or a rating of [***] from Moody’s Investor Service.
Management Committee
– has the meaning set forth in Section 6.02.
Material Contracts
– means any of the following contracts, agreements, letter agreements or other instruments to which the Company or any Series is or becomes a party after the Effective Date: engineering, procurement and construction contracts, contracts for the construction of the Facilities, contracts for the procurement of pipe, compression and associated equipment and any other contracts that require expenditures by the Company or any Series in excess of [***] Dollars ($[***]) in the aggregate or provide for revenue to the Company or any Series in excess of [***] Dollars ($[***]), in each case, subject to the approval of the Management Committee pursuant to Section 6.02(i)(D).
Matured Financing Obligation
– means the Company’s debt for borrowed money (including any related interest, costs, fees, hedge unwind costs or other repayment obligations) that has become due (including by acceleration or any full or partial mandatory prepayment thereof) under any Financing Commitment.
Member
– means any Person executing this Agreement as of the date of this Agreement as a member or hereafter admitted to the Company as a member as provided in this Agreement, but such term does not include any Person who has ceased to be a member in the Company.
Member Nonrecourse Debt
– has the meaning assigned to the term “partner nonrecourse debt” in Treasury Regulation Section 1.704-2(b)(4).
Member Nonrecourse Debt Minimum Gain
– has the meaning assigned to the term “partner nonrecourse debt minimum gain” in Treasury Regulation Section 1.704-2(i)(2).
Member Nonrecourse Deductions
– has the meaning assigned to the term “partner nonrecourse deductions” in Treasury Regulation Sections 1.704-2(i)(1) and 1.704-2(i)(2).
Membership Interests
– has the meaning set forth in Section 3.01(a).
Minimum Gain
– means, with respect to each Series, (a) with respect to Nonrecourse Liabilities associated with the Series, the amount of gain that would be realized by the Company with respect to the Series if it disposed of (in a taxable transaction) all Company properties with respect to the Series that are subject to the Nonrecourse Liabilities in full satisfaction of the Nonrecourse Liabilities, computed in accordance with Treasury Regulations Section 1.704-2(d), or (b) with respect to each Member Nonrecourse Debt, the amount of gain that would be realized by the Company with respect to the Series if it disposed of (in a taxable transaction) the Company property with respect to the Series that is subject to such Member Nonrecourse Debt in full satisfaction of such Member Nonrecourse Debt, computed in accordance with Treasury Regulations Section 1.704-2(i).
Necessary Regulatory Approvals
– means all Authorizations as may be required (but excluding Authorizations of a nature not customarily obtained prior to commencement of construction of facilities) in connection with (a) the formation of the Company and the construction, acquisition and operation of the Facilities; and (b) the transportation of the natural gas to be transported under the applicable Gas Transportation Service Agreements through the Facilities including the applicable FERC Certificate.
New Member
– means a Person, other than EQT or USG, admitted after the Effective Date pursuant to the terms and conditions of this Agreement.
NGA
– means the Natural Gas Act of 1938, as amended.
Non-Contributing/Loan Member
– has the meaning set forth in Section 4.06(a).
Non-Changing Founding Member
– has the meaning set forth in Section 3.03(b)(vi)(C).
Non-Disposing Founding Member
– has the meaning set forth in Section 3.03(b)(ii)(A).
Nonrecourse Deductions
– has the meaning assigned that term in Treasury Regulation Sections 1.704-2(b) and 1.704-2(c).
Nonrecourse Liabilities
– means, with respect to any Series, nonrecourse liabilities (or portions thereof) associated with the Series for which no Member bears the economic risk of loss, as determined under Treasury Regulations Section 1.704-2(b)(3) and 1.752-1(a)(2).
Non-Termination Member
– has the meaning set forth in Section 3.03(b)(viii).
Operator
– means EQT Gathering, LLC, a Delaware limited liability company, and any successor operator appointed following a termination of the COM Agreement.
Operating Budget
– means, with respect to each Series, the Initial Operating Budget and each subsequent annual operating budget for the Series that is approved (or deemed approved) pursuant to Section 6.02(i)
(GG). The Operating Budget shall cover all items that are classified as non-capital items under Required Accounting Practices.
[***]
Operator Preferential Right
– has the meaning set forth in Section 3.03(b)(ii)(D).
Outstanding Capital Contributions
– means, with respect to each Series and with respect to any Member as of the time of any determination, the excess, if any, of (i) the aggregate Capital Contributions previously made by such Member with respect to the Series, over (ii) the aggregate distributions previously made by the Company to such Member with respect to the Series pursuant to Article 5.
Parent
– means (i) with respect to a Member, the Person that directly or indirectly Controls such Member as set forth in
Exhibit A
, which shall be promptly updated by a Member upon any change to the identity of such Member’s Parent, or (ii) with respect to the Operator, the Person that ultimately Controls the Operator.
Parent Decision Makers
– means the chief executive officer of the Parent of each of USG and EQT or another senior executive officer designated in writing by the chief executive officer of the Parent of each of USG and EQT (a copy of which writing to be delivered promptly to the other Founding Member(s)).
Performance Assurances
– has the meaning set forth in Section 4.01(b)(i).
Permitted Encumbrance
– means (i) liens for taxes or assessments not yet due or not yet delinquent or, if delinquent, that are being contested in good faith in the normal course of business; (ii) easements, rights-of-way, servitudes, permits, surface leases, and other rights in respect of surface operations, pipelines, grazing, logging, canals, ditches, reservoirs or the like, and easements for streets, alleys, highways, pipelines, telephone lines, power lines, railways, and other easements and rights-of-way, on, over or in respect of any properties that do not materially impair the use of the assets of, or the operation of the business of, the Company; and (iii) rights reserved to or vested in any municipality or governmental, statutory, or public authority to control or regulate any properties in any manner, and all applicable Laws of any Governmental Authority.
Person
– has the meaning assigned that term in Section 18-101(11) of the Act and also includes a Governmental Authority and any other entity.
Precedent Agreement
– means any agreement between the Company and a prospective shipper of natural gas through the Facilities that involves the commitment by such shipper to pay demand charges in return for a firm transportation obligation on the part of the Company, in each case subject to the satisfaction of one or more conditions precedent.
Preferential Exercise Notice
– has the meaning set forth in Section 3.03(b)(ii)(A).
Preferential
Purchasing Member
– has the meaning set forth in Section 3.03(b)(ii)(A).
Preferential Right
– has the meaning set forth in Section 3.03(b)(ii)(A).
[***]
[***]
Project Schedule
– has the meaning set forth in Section 4.01(a)(i).
Qualified Guarantor
– means, with respect to a Member, such Member’s Parent or a subsidiary of such Member’s Parent, in each case, so long as such Person is Investment Grade.
Quarter
– unless the context requires otherwise, means a fiscal quarter of the Company.
Related Party Matter –
means (a) any occurrence or circumstance where (i) the Company, on the one hand, and a Member or an Affiliate of such Member, on the other hand, propose to enter into, terminate, or amend a contract or arrangement with each other, including, without limitation, a Gas Transportation Service Agreement, a Precedent Agreement, the COM Agreement, or any other contract or arrangement, or (ii) any Member believes that a dispute has arisen between the Company and an Affiliate of any Member under a Gas Transportation Service Agreement, a Precedent Agreement, the COM Agreement, or any other contract or arrangement, or (iii) a matter with respect to enforcement under any such Gas Transportation Service Agreement, Precedent Agreement, COM Agreement, or other contract or arrangement is involved; (b) making any determination as to the suitability of a Qualified Guarantor of a Member (other than a Founding Member, which is addressed in the definition of “Qualified Guarantor”) or substitution of a successor Qualified Guarantor of such Member; (c) the appointment of any successor Operator or Shipper that is an Affiliate of a Member; (d) any decision by the Company to exercise any of the owner performance rights under Section 4.4 of the COM Agreement while an Affiliate of EQT or USG is the Operator; or (e) making any determination, not to be unreasonably withheld, with respect to the suitability of the Operator pursuant to clause (b) of the definition of Change of Control.
Representative
– has the meaning set forth in Section 6.02(a)(i).
Representative Budget Comments
– has the meaning set forth in Section 6.09.
Required Accounting Practices
– means the accounting rules and regulations, if any, at the time prescribed by the Governmental Authorities under the jurisdiction of which the Company is at the time operating and, to the extent of matters not covered by such rules and regulations, generally accepted accounting principles as practiced in the United States at the time prevailing for companies engaged in a business similar to that of the Company.
Rules
– has the meaning set forth in Section 11.05(a).
[***]
[***]
[***]
[***]
Selection Notice
– has the meaning set forth in Section 11.05(c).
Series
– has the meaning set forth in Section 3.01(b).
Series A
– means the initial Series created hereunder as of the date hereof that holds the Initial Facilities.
Series Schedule
– has the meaning set forth in Section 3.01(c).
Sharing Ratio
– means, subject in each case to adjustments in accordance with this Agreement or in connection with Dispositions of Membership Interests, (a) in the case of a Member executing this Agreement as of the date of this Agreement or a Person acquiring such Member’s Membership Interest, the percentage specified for that Member as its Sharing Ratio on
Exhibit A
with respect to a Series, and (b) in the case of Membership Interests issued pursuant to Section 3.04, the Sharing Ratio established pursuant thereto;
provided
that the total of all Sharing Ratios for each Series shall always equal 100%.
[***]
[***]
[***]
Shippers
– means the Founding Shippers and any other Person that (a) has entered into a Gas Transportation Service Agreement with the Company or its designee (or, if applicable, a Precedent Agreement relating thereto) to provide transportation of natural gas through the Facilities and (b) meets the criteria for creditworthiness determined by the Management Committee.
[***]
Sole Discretion
– has the meaning set forth in Section 6.02(f)(ii).
Subject Contract
– has the meaning set forth in Section 4.07(a).
Supermajority Interest
–
means the approval of the Representatives of the Founding Members representing greater than [***]% of the aggregate Sharing Ratios of the Founding Members.
Tax Matters Member
– has the meaning set forth in Section 8.03(a).
Term
– has the meaning set forth in Section 2.07.
Termination Member
– has the meaning set forth in Section 3.03(b)(viii).
Total Event Demand Amount
– has the meaning set forth in Section 4.07(b).
Treasury Regulations
– means the regulations (including temporary regulations) promulgated by the United States Department of the Treasury pursuant to and in respect of provisions of the Code. All references herein to sections of the Treasury Regulations shall include any corresponding provision or provisions of succeeding, similar or substitute, temporary or final Treasury Regulations.
USG
– has the meaning set forth in the Preamble.
Withdrawal
, or
Withdrawn
– means or refers to the withdrawal, resignation, or retirement of a Member from the Company as a Member. Such terms shall not include any Dispositions of Membership Interests (which are governed by Sections 3.03(a) and (b)), even though the Member making a Disposition may cease to be a Member as a result of such Disposition.
Withdrawn Member
– has the meaning set forth in Section 10.03.
Other terms defined herein have the meanings so given them.
|
|
1.02
|
Interpretation
. Unless the context requires otherwise: (a) the gender (or lack of gender) of all words used in this Agreement includes the masculine, feminine and neuter; (b) references to Articles and Sections refer to Articles and Sections of this Agreement; (c) references to Exhibits refer to the Exhibits attached to this Agreement, each of which is made a part hereof for all purposes; (d) references to Laws refer to such Laws as they may be amended from time to time, and references to particular provisions of a Law include any corresponding provisions of any succeeding Law; (e) references to money refer to legal currency of the United States of America; (f) the definitions given for terms in this Article 1 and elsewhere in this Agreement shall apply to both the singular and plural forms of the terms defined, (g) the conjunction “or” shall be understood in its inclusive sense (and/or); and (h) the words “hereby”, “herein”, “hereunder”, “hereof” and words of similar import refer to this Agreement as a whole (including any Exhibits and Schedules hereto) and not merely to the specific section, paragraph or clause in which such word appears.
|
ARTICLE 2
ORGANIZATION
|
|
2.01
|
Formation
. The Company has been organized as a Delaware limited liability company by the filing of the Delaware Certificate and execution of the Initial Agreement as of August 22, 2014. The Delaware Certificate contains and shall maintain a notice of the limitation of liabilities of series in conformity with Section 18-215 of the Act.
|
|
|
2.02
|
Name
. The name of the Company is Mountain Valley Pipeline, LLC, and all Company business shall be conducted in that name or such other names that comply with Law as the Management Committee may select.
|
|
|
2.03
|
Registered Office; Registered Agent; Principal Office in the United States; Other Offices
. The registered office of the Company required by the Act to be maintained in the State of Delaware shall be the office of the initial registered agent named in the Delaware Certificate or such other office (which need not be a place of business of the Company) as the Management Committee may designate in the manner provided by Law. The registered agent of the Company in the State of Delaware shall be the initial registered agent named in the Delaware Certificate or such other Person or Persons as the Management Committee may designate in the manner provided by Law. The principal office of the Company in the United States shall be at such place as the Management Committee may designate, which need not be in the State of Delaware, and the Company shall maintain records there or such other place as the Management Committee shall designate and shall keep the street address of such principal office at the registered office of the Company in the State of Delaware. The Company may have such other offices as the Management Committee may designate.
|
|
|
2.04
|
Purposes
. The purposes of the Company are to plan, design, construct, acquire, own, finance, maintain and operate the Facilities, to market the services of the Facilities, to engage in the transmission of natural gas through the Facilities, and to engage in any activities directly or indirectly relating thereto, including the Disposition of the Facilities.
|
|
|
2.05
|
No State Law Partnership
. The Members intend that the Company shall be a limited liability company and, except as provided in Article 8 with respect to U.S. federal income tax treatment (and other tax treatment therewith), the Company shall not be a partnership (including a limited partnership) or joint venture, and no Member shall be a partner or joint venture of any other Member, for any purposes, and this Agreement may not be construed to suggest otherwise.
|
|
|
2.06
|
Foreign Qualification
. Prior to the Company’s conducting business in any jurisdiction other than Delaware, the Management Committee shall cause the Company to comply, to the extent procedures are available and those matters are reasonably within the control of the Management Committee, with all requirements necessary to qualify the Company as a foreign limited liability company in that jurisdiction. At the request of the Management Committee, each Member shall execute, acknowledge, swear to, and deliver all certificates and other instruments conforming with this Agreement that are necessary or appropriate to qualify, continue, and terminate the Company as a foreign limited liability company in all such jurisdictions in which the Company may conduct business.
|
|
|
2.07
|
Term
. The period of existence of the Company (the
“
Term
”
) commenced on August 22, 2014, and shall end at such time as a certificate of cancellation is filed with the Secretary of State of Delaware in accordance with Section 12.04.
|
|
|
2.08
|
Title to Property
. All assets, property and rights of the Company or any Series shall be owned or leased by the Company or such Series as an entity and, except with respect to assets, property or rights of the Company or such Series leased or licensed to the Company by a Member (subject to the terms hereof), no Member shall have any ownership interest in such assets, property or rights in its individual name or right, and each Member’s Membership Interest shall be personal property for all purposes. Subject to Section 3.01(b), the Company shall hold all assets, property and rights of the Company in the name of the Company and not in the name of any Member.
|
ARTICLE 3
MEMBERSHIP INTERESTS; DISPOSITIONS OF INTERESTS
(a)
The capital structure of the Company shall consist of one class of limited liability company interests called “
Membership Interests
,” which shall consist of, with respect to any Member and with respect to each Series, (a) that Member’s status as a Member; (b) that Member’s share of the income, gain, loss, deduction, and credits of, and the right to receive distributions from, the Company; (c) any [***] to which that Member is entitled pursuant to Section 4.06(b); (d) all other rights, benefits, and privileges enjoyed by that Member (under the Act, this Agreement, or otherwise) in its capacity as a Member, including that Member’s rights to vote, consent, and approve amendments to this Agreement pursuant to Section 13.05; (e) with respect to the Founding Members only, such Founding Members’ rights to participate in the management of the Company through the Management Committee; and (f) all obligations, duties, and liabilities imposed on that Member (under the Act or this Agreement or otherwise) in its capacity as a Member, including any obligations to make Capital Contributions to the extent set forth in Article 4. As of the Effective Date, EQT and USG are the Members of the Company and have Membership Interests in Series A.
(b)
Notwithstanding any other provision of this Agreement, from time to time, the Management Committee may, by written resolution approved by a Supermajority Interest, establish one (1) or more additional series pursuant to Section 18-215 of the Act (each, a “
Series
”) for purposes of holding any Facilities of the Company. Upon the establishment of each Series, the Management Committee shall designate the Members and the Sharing Ratios with respect to such Series and the assets and liabilities of the Company that will be allocated to or become the assets and liabilities of such Series; [***]. Legal title to any assets allocated to a Series may be held in the name of such Series or in the Company’s name, as may be determined by the Management Committee.
(c)
Separate and distinct records shall be maintained for each Series and the assets and liabilities associated with each Series shall be held and accounted for separately from the other assets and liabilities of any other Series for all purposes. The Company may open a separate bank account for any such Series. The Management Committee may authorize each Series to issue separate Membership Interests having the terms, preferences, powers, rights, and obligations of Membership Interests as set forth herein and as may be otherwise set forth on the Series Schedule (as defined below) adopted by the Management Committee. Each Member shall have such Sharing Ratio in Series A as set forth on
Exhibit A
and shall have such Sharing Ratio in each such additional Series in any addendum to this Agreement to be adopted by the Management Committee for each such additional Series with the written resolution authorizing the applicable additional Series (each such addendum, a “
Series Schedule
”), and this Agreement shall accordingly be amended with each such additional Series Schedule. In the case of any such additional Series that is not treated as a separate partnership for U.S. federal tax purposes (if so determined by the Management Committee), the Series Schedule for such Series shall either provide that any or all of Sections 4.05, 5.04, 5.06, 8.02 or 8.03 hereof do not apply to such Series or shall otherwise provide how such Sections (or any other Sections hereof) are modified with respect to such Series, as agreed to by the Members holding Membership Interests in such Series;
provided
that, so long as a Series generates, or can reasonably be expected to generate, income for U.S. federal income tax purposes that is or would be exclusively “qualifying income” (as such term is defined pursuant to Section 7704 of the Code), such Series shall not be treated other than as a separate partnership (or disregarded as an entity separate from a separate partnership) for U.S. federal tax purposes. All profits and losses generated by assets allocated to a Series shall inure to the benefit of only the Members holding Membership Interests in such Series in accordance with Section 5.04. Subject to Article 12, a Series may not be terminated and its affairs wound up pursuant to Section 18-215(k) of the Act without the affirmative vote of a Supermajority Interest.
(d)
All debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to each Series shall be enforceable against the assets of such Series only and not against the assets of the Company generally or any other Series, and none of the debts, liabilities, obligations, or expenses incurred, contracted for, or otherwise existing with respect to the Company generally or any other Series shall be enforceable against the assets of such Series. Any Person extending credit to, contracting with, or otherwise having any claim against any Series may look only to the assets of that Series to satisfy any such obligation or claim and shall have no claim or right to any assets allocated to or belonging to any other Series or the Company generally. Notice of this limitation on liabilities to Series has been set forth in the Delaware Certificate, and the statutory provisions of Section 18-215 of the Act (and the statutory effect under Section 18-215 of setting forth such notice in the Certificate of Formation) shall be applicable to the Company and each Series that may be established.
|
|
3.02
|
Representations, Warranties and Covenants
.
|
(a)
Each Member hereby represents, warrants, and covenants to the Company and to each other Member that the following statements are true and correct as of the Effective Date:
(i)
that such Member is duly incorporated, organized, or formed (as applicable), validly existing, and (if applicable) in good standing under the Law of the jurisdiction of its incorporation, organization, or formation; if required by applicable Law, that such Member is duly qualified and in good standing in the jurisdiction of its principal place of business, if different from its jurisdiction of incorporation, organization, or formation; and that such Member has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder, and all necessary actions by the board of directors, officers, shareholders, managers, members, partners, trustees, beneficiaries, or other applicable Persons necessary for the due authorization, execution, delivery, and performance of this Agreement by that Member have been duly taken;
(ii)
that such Member has duly executed and delivered this Agreement and the other documents that this Agreement contemplates that such Member will execute, and they each constitute the valid and binding obligation of such Member enforceable against it in accordance with their respective terms (except as may be limited by bankruptcy, insolvency or similar Laws of general application and by the effect of general principles of equity, regardless of whether considered at law or in equity); and
(iii)
that such Member’s authorization, execution, delivery, and performance of this Agreement does not and will not (A) conflict with, or result in a breach, default or violation of, (1) the organizational documents of such Member, (2) any contract or agreement to which that Member is a party or is otherwise subject, or (3) any Law, order, judgment, decree, writ, injunction, or arbitral award to which such Member is subject; or (B) other than the FERC Application and the Necessary Regulatory Approvals that the Members have agreed to obtain pursuant to Article 7, require any consent, approval, or authorization from, filing or registration with, or notice to, any Governmental Authority or other Person, unless such requirement has already been satisfied.
(b)
The Company hereby represents and warrants, and the Company covenants, to each Member that the following statements are true and correct as of the Effective Date:
(i)
(x) the Company is duly formed and is validly existing, and in good standing under the Act; (y) the Company has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder (including the issuance of the Membership Interests to each Member), and all necessary actions by the Company’s managers, members or other applicable Persons necessary for the due authorization, execution, delivery, and performance of this Agreement by the Company have been duly taken;
(ii)
the issuance of the Membership Interests to each Member, as contemplated hereby, has been duly authorized by all requisite limited liability company action on the part of the Company and its members, managers or other applicable Persons, and such Membership Interests are validly issued and, subject only to the terms of Article 4, fully paid and nonassessable and, subject to the restrictions in Article 3, are being issued free and clear of any preemptive rights under the Act or other applicable law, the organizational documents of the Company, and any other contract to which the Company or its members, managers or other Person is bound or by which their property is subject;
(iii)
no other Person has any right to acquire any Membership Interest or other equity interest in the Company or take part in the management of the Company; and
(iv)
the Company has not entered into any contract, agreement, or other arrangement with any Person with respect to the Company, the Facilities, the Membership Interests, or voting rights with respect to the Company.
|
|
3.03
|
Dispositions and Encumbrances of Membership Interests
.
|
(a)
General Restriction
. A Member may not Dispose of or Encumber all or any portion of its Membership Interest except in strict accordance with this Section 3.03. References in this Section 3.03 to Dispositions or Encumbrances of a “Membership Interest” shall also refer to Dispositions or Encumbrances of a portion of a Membership Interest. Any attempted Disposition or Encumbrance of a Membership Interest, other than in strict accordance with this Section 3.03, shall be, and is hereby declared, null and void
ab initio
. The rights and obligations constituting a Membership Interest may not be separated, divided, or split from the other attributes of a Membership Interest except as contemplated by the express provisions of this Agreement. The Members agree that the provisions of this Section 3.03 may be enforced by specific performance pursuant to Section 11.04.
|
|
(b)
|
Dispositions of Membership Interests.
|
(i)
General Restriction
. Subject to Sections 3.03(d), (e), and (f), no Member may Dispose of its Membership Interest without the prior written consent of each of EQT and USG, which consent may be withheld by each in its Sole Discretion;
provided
,
however
, that no such consent shall be required (A) with respect to a Founding Member, where such Disposition would not cause the Company or applicable Series to be treated as a publicly traded partnership subject to tax as an association for U.S. federal income tax purposes, and (B) with respect to a [***] or any other Member (other than a Founding Member), where such Disposition (x) when added to all Dispositions by such [***] or Member during the immediately preceding twelve (12) months, is less than 50% of such [***] or Member’s Sharing Ratio as of the beginning of such period of twelve (12) months, (y) would not cause any adverse tax consequences to the Company, any Series, or any Member, and (z) would not cause the Company or applicable Series to be treated as a publicly traded partnership subject to tax as an association for U.S. federal income tax purposes. Subject to receiving the consent required in the foregoing sentence, if necessary, a Member may Dispose of its Membership Interest only by complying with all of the following requirements: (I) such Member must offer the Founding Members the right to acquire such Membership Interest in accordance with Section 3.03(b)(ii), unless (1) the proposed Assignee is an Affiliate of the Disposing Member or the Founding Members consent to the Disposition to such Assignee, which consent may be granted or withheld in the Sole Discretion of each Founding Member or (2) the Disposition is made by EQT or USG in accordance with Section 3.03(d), (e), or (f); (II) such Member must comply with the requirements of Section 3.03(b)(iv) and, if the Assignee is to be admitted as a Member, Section 3.03(b)(iii); and (III) unless the proposed Assignee is an Affiliate of the Disposing Member, the Disposition must comply with the following minimum size requirements: (1) if such Member’s Sharing Ratio with respect to a Series is less than [***]%, the Disposition must include all of the Member’s Membership Interest with respect to the Series, and (2) except with respect to [***], if such Member’s Sharing Ratio with respect to a Series is [***] or more, but such Member does not propose to dispose of all of its Membership Interest with respect to the Series, the Disposition must be of a Membership Interest having a Sharing Ratio with respect to the Series of at least [***]%.
(ii)
Preferential Purchase Rights
.
(A)
Preferential Purchase Rights
. Subject to Section 3.03(b)(ii)(B), Section 3.03(b)(ii)(C), and Section 3.03(b)(ii)(D), if a Member desires to consummate a bona fide transaction that will result in the Disposition of all or a portion of its Membership Interest in a Series (whether or not the proposed Disposition is to another Member), then such Member (the “
Disposing Member
”) shall promptly give notice thereof (the “
Disposition Notice
”) to the Company and each Founding Member of the Series;
provided
that this Section 3.03(b)(ii) shall not apply to a Disposition to an Affiliate of the Disposing Member or a Disposition in accordance with Section 3.03(d), [***], or Section 3.03(e), or Section 3.03(f). The Disposition Notice shall set forth all relevant information with respect to the proposed Disposition, including the name and address of the prospective acquirer, the precise Membership Interest and Series that is the subject of the Disposition, the price to be paid for such Membership Interest, and any other terms and conditions of the proposed Disposition. If any Member is a Disposing Member but either or both of EQT and/or USG and their respective Affiliates are not the Disposing Member (such of EQT and/or USG and their respective Affiliates as is not a Disposing Member being referred to herein as the “
Non-Disposing Founding Member(s)
”), such Non-Disposing Founding Member(s) shall have the right (the “
Preferential Right
”) to acquire, for the same purchase price, and on the same material terms and conditions, as are set forth in the Disposition Notice, some or all of the Membership Interest specified in the Disposition Notice;
provided
that, if the purchase price to be paid to the Disposing Member pursuant to the proposed Disposition is not entirely in cash, the purchase price for the Non-Disposing Founding Member(s) exercising the Preferential Right shall be [***]. The Non-Disposing Founding Member(s) shall have [***] Days following receipt of the Disposition Notice (or if the price to be paid pursuant to such offer is not in cash, then [***] Days following [***]) in which to notify the other Members (including the Disposing Member) whether such Non-Disposing Founding Member(s) desires to exercise its Preferential Right. A notice in which a Non-Disposing Founding Member exercises such Preferential Right is referred to herein as a “
Preferential Exercise Notice
” and as deliverer of a Preferential Exercise Notice, such Non-Disposing Founding Member is referred to herein as a “
Preferential
Purchasing Member
.” The Preferential Purchasing Member(s) shall indicate in a Preferential Exercise Notice whether the Preferential Purchasing Member(s) elects to purchase all of the Disposing Member’s Membership Interest as set forth in the Disposition Notice or any portion thereof. In the event that more than one of EQT or USG (or their respective Affiliates) is a Preferential Purchasing Member, then each Preferential Purchasing Member shall indicate in a Preferential Exercise Notice whether it elects to purchase only its
pro rata
share of the Membership Interest offered in the Disposition Notice (based on its Sharing Ratio in the applicable Series) or whether such Preferential Purchasing Member elects to purchase a greater portion of such Membership Interest (up to the full amount thereof). If the Preferential Purchasing Member(s) elects to exercise the Preferential Right to purchase the entire Membership Interest offered in the Disposition Notice (subject to proration based on the Preferential Purchasing Members’ respective Sharing Ratios in the applicable Series in the event that Preferential Purchasing Members elected to purchase a greater number of Membership Interests than the amount offered), the Disposing Member and the Preferential Purchasing Member(s) shall close the acquisition of the Membership Interest in accordance with Section 3.03(b)(ii)(E). In the event that the Preferential Purchasing Member(s) elect to purchase less than the entire Membership Interest specified in the Disposition Notice, then the Disposing Member shall have the right to Dispose of the remaining amount of the unexercised portion of the Membership Interest in accordance with Section 3.03(b)(ii)(E).
(B)
[***].
(C)
[***].
(D)
Preferential Purchase Right Resulting from Disposition of Membership Interests Held by the Operator
. Notwithstanding the foregoing, for so long as the Operator is an Affiliate of a Member, if the Disposing Member is the Operator and the Assignee of such Disposing Member’s Membership Interests is not an Affiliate of such Member (including, for the avoidance of doubt, in the event the Operator is an Affiliate of EQT or EQM, where the Assignee is not an Affiliate of either EQT or EQM), then such Disposing Member shall promptly deliver the Disposition Notice to the Non-Disposing Founding Members that are not Affiliates of the Operator, and such Non-Disposing Founding Members and their Affiliates shall have the right (the “
Operator Preferential Right
”) to acquire a portion of the Membership Interests of the Disposing Member for the same purchase price and on the same material terms and conditions as are set forth in the Disposition Notice;
provided
that, if the purchase price to be paid to the Disposing Member pursuant to the proposed Disposition is not entirely in cash, the purchase price shall be [***]. The Non-Disposing Founding Members and their Affiliates shall have [***]
Days following receipt of the Disposition Notice (or if the price to be paid pursuant to such offer is not in cash, then [***] Days following [***]) in which to notify the Disposing Member whether they desire to exercise the Operator Preferential Right. To the extent a Non-Disposing Founding Members or any of its Affiliates exercises its Operator Preferential Right, such Non-Disposing Founding Member (or its Affiliate) will be deemed a Preferential Purchasing Member. If the Non-Disposing Founding Member or any of its Affiliates elects to exercise the Operator Preferential Right to purchase the entire Membership Interest offered in the Disposition Notice, then the Disposing Member and the Non-Disposing Founding Member (or its Affiliate) shall close the acquisition of the Membership Interest in accordance with Section 3.03(b)(ii)(E). In the event that the Non-Disposing Founding Member (or its Affiliate) elects to purchase less than the entire Membership Interest specified in the Disposition Notice, then the Disposing Member shall have the right to Dispose of the remaining amount of the unexercised portion of the Membership Interest in accordance with Section 3.03(b)(ii)(E).
(E)
Closing
. If the Preferential Rights are exercised in accordance with Section 3.03(b)(ii)(A), 3.03(b)(ii)(B), 3.03(b)(ii)(C), or 3.03(b)(ii)(D), as applicable, the closing of the purchase of the Membership Interest shall occur at the principal place of business of the Company no later than the [***] Day after the expiration of the [***]-Day period referred to in Section 3.03(b)(ii)(A), Section 3.03(b)(ii)(B), 3.03(b)(ii)(C), or 3.03(b)(ii)(D), as applicable (or, if later, the fifth Business Day after the receipt of all applicable Authorizations to the purchase), unless the Disposing Member and the Preferential Purchasing Member(s) agree upon a different place or date. At the closing, (1) the Disposing Member shall execute and deliver to the Preferential Purchasing Member(s) (aa) an assignment of the Membership Interest, in form and substance reasonably acceptable to the Preferential Purchasing Member(s) containing a general warranty of title as to such Membership Interest (including that such Membership Interest is free and clear of all Encumbrances, other than those permitted under Section 3.03(c)(ii)) and (bb) any other instruments reasonably requested by the Preferential Purchasing Member(s) to give effect to the purchase; and (2) the Preferential Purchasing Member(s) shall deliver to the Disposing Member in immediately-available funds the purchase price provided for in Section 3.03(b)(ii)(A), Section 3.03(b)(ii)(B), 3.03(b)(ii)(C), or 3.03(b)(ii)(D), as applicable. The Sharing Ratios and Capital Accounts of the Members shall be deemed adjusted to reflect the effect of the purchase.
(F)
Waiver of Preferential Right
. If no Non-Disposing Founding Member delivers a First Preferential Exercise Notice or Second First Preferential Exercise Notice, or if the Preferential Rights are not exercised in full pursuant to Section 3.03(b)(ii)(A), 3.03(b)(ii)(B), 3.03(b)(ii)(C), or 3.03(b)(ii)(D), the Disposing Member shall have the right, subject to compliance with the provisions of Sections 3.03(a) and (b), to Dispose of the portion of the Membership Interest described in the Disposition Notice that is not purchased pursuant to the Preferential Rights to the proposed Assignee strictly in accordance with the terms of the Disposition Notice for a period of [***] Days after the expiration of the [***]-Day period referred to in such Section 3.03(b)(ii)(A), 3.03(b)(ii)(B), 3.03(b)(ii)(C), or 3.03(b)(ii)(D) (or, if later, the fifth Business Day after the receipt of all applicable Authorizations to the purchase). If, however, the Disposing Member fails so to Dispose of the Membership Interest within such [***]-Day period (or, if applicable, such fifth Business Day period), the proposed Disposition shall again become subject to the Preferential Rights.
(G)
Transfer of Operator Rights
. In connection with a Disposition of Membership Interests where the rights provided for in this Section 3.03(b)(ii) are not exercised or where such rights are waived pursuant to Section 3.03(b)(ii)(F), the Member with the right to appoint the Operator (which Member shall initially be EQT) may transfer such right to appoint the Operator to the assignee of such Membership Interests; [***].
(iii)
Admission of Assignee as a Member
. An Assignee has the right to be admitted to the Company as a Member, with the Membership Interest in the applicable Series (and attendant Sharing Ratio) so transferred to such Assignee, only upon consent of the Management Committee and only if such Disposition is effected in strict compliance with Sections 3.03(a) and (b) or is effected in accordance with Section 3.03(d), [***], or Section 3.03(e), or Section 3.03(f).
(iv)
Requirements Applicable to All Dispositions and Admissions
. In addition to the requirements set forth in Sections 3.03(b)(i), 3.03(b)(ii) and 3.03(b)(iii), any Disposition of a Membership Interest and any admission of an Assignee as a Member shall also be subject to the following requirements, and such Disposition (and admission, if applicable) shall not be effective unless such requirements are complied with;
provided
the Management Committee, in its sole and absolute discretion, may waive any of the following requirements:
(A)
Disposition Documents
. The following documents must be delivered to the Management Committee and must be satisfactory, in form and substance, to the Management Committee in its sole and absolute discretion:
(1)
Disposition Instrument
. A copy of the instrument pursuant to which the Disposition is effected.
(2)
Ratification of this Agreement
. An instrument, executed by the Disposing Member and its Assignee, containing the following information and agreements, to the extent they are not contained in the instrument described in Section 3.03(b)(iv)(A)(1): (aa) the notice address of the Assignee; (bb) if applicable, the Parent of the Assignee; (cc) the Sharing Ratios after the Disposition of the Disposing Member and its Assignee (which together must total the Sharing Ratio of the Disposing Member before the Disposition); (dd) the Assignee’s ratification of this Agreement and agreement to be bound by it, and its confirmation that the representations and warranties in Section 3.02 are true and correct with respect to it; and (ee) representations and warranties by the Disposing Member and its Assignee (1) that the Disposition and admission is being made in accordance with all applicable Laws, (2) that the matter set forth in Section 3.03(b)(iv)(A)(3) is true and correct, and (3) that the Disposition and admission do not violate any Financing Commitment or any other agreement to which the Company is a party.
(3)
Securities Law Opinion
. Unless the Membership Interest subject to the Disposition is registered under the Securities Act of 1933, as amended, and any applicable state securities Law, a favorable opinion of the Disposing Member’s legal counsel, or, if so elected by the Management Committee, the Company’s legal counsel or other legal counsel acceptable to the Management Committee, to the effect that the Disposition and admission is being made pursuant to a valid exemption from registration under those Laws and in accordance with those Laws;
provided
that no such opinion shall be required in the case of a Disposition by a Member to an Affiliate or a Disposition made in accordance with Section 3.03(d), with respect to [***], or Section 3.03(e), or Section 3.03(f).
(4)
Tax Opinion
. A favorable opinion of the Disposing Member’s legal counsel, or, if so elected by the Management Committee, the Company’s legal counsel or other legal counsel acceptable to the Management Committee, to the effect that the Disposition would not cause the Company or applicable Series to be treated as a publicly traded partnership subject to tax as an association for U.S. federal income tax purposes (unless the provision of such tax opinion is waived in advance by the Management Committee);
provided
that no such opinion shall be required in the case of a Disposition by a Member to an Affiliate or a Disposition made in accordance with Section 3.03(d), with respect to [***], or Section 3.03(e), or Section 3.03(f).
(B)
Payment of Expenses
. The Disposing Member and its Assignee shall pay, or reimburse the Company for, all reasonable costs and expenses incurred by the Company in connection with the Disposition and admission, including the legal fees incurred in connection with the legal opinions referred to in Section 3.03(b)(iv)(A)(3) and (4), on or before the 10th Day after the receipt by that Person of the Company’s invoice for the amount due. The Company will provide such invoice as soon as practicable after the amount due is determined but in no event later than [***] Days thereafter. If payment is not made by the date due, the Person owing that amount shall pay interest on the unpaid amount from the date due until paid at a rate per annum equal to the Default Rate.
(C)
No Release
. No Disposition of a Membership Interest shall effect a release of the Disposing Member from any liabilities to the Company or the other Members arising from events occurring prior to the Disposition.
(D)
Indebtedness of Company
. Any Disposition of all or any portion of the Membership Interest of a Member shall also include the Disposition of a proportionate share of the Indebtedness owed by the Company to the Disposing Member. As long as this Agreement shall remain in effect, all evidences of Indebtedness of the Company owed to any of the Members shall bear an appropriate legend to indicate that it is held subject to, and may be Disposed only in accordance with, the terms and conditions of this Agreement, and that such Disposition may be made only in conjunction with the Disposition of a proportionate part of such Member’s Membership Interest.
(v)
Deemed Membership Disposition
. A Deemed Membership Disposition shall be deemed to be a Disposition of a Membership Interest and must comply with the requirements set forth in Sections 3.03(a) and (b).
(vi)
Change of Control
.
(A)
[***].
(B)
[***].
(C)
[***].
(D)
Change of Control of Member That Is the Operator
. Notwithstanding the foregoing, [***].
(E)
Closing
. If the [***].
(F)
Definitions
. As used in this Section 3.03(b)(vi), [***].
(vii)
[
Intentionally omitted
.]
(viii)
[***]
(c)
Encumbrances of Membership Interest
. A Member may not Encumber its Membership Interest in a Series, except by complying with one of the two following paragraphs:
(i)
(A) such Member must receive the consent of [***] of the non-Encumbering Founding Members (calculated without reference to the Sharing Ratio of the Encumbering Founding Member in such Series), which consent (as contemplated by Section 6.02(f)(ii)) may be granted or withheld in the Sole Discretion of each such other Member; and (B) the instrument creating such Encumbrance must provide that any foreclosure of such Encumbrance (or Disposition in lieu of such foreclosure) must comply with the requirements of Sections 3.03(a) and (b); or
(ii)
such Encumbrance is [***].
(d)
[***]
(e)
EQT
[***]
and Related Assignment Rights
. Notwithstanding anything in this Agreement to the contrary, EQT shall have the right from time to time to sell or assign (i) to [***] or (ii) to any [***] Person Controlled by EQT or its then Parent all or any part of the Membership Interest in a Series then held by EQT or its Affiliates (
provided
that, in either case, if such sale or assignment occurs prior to the In-Service Date, then, at the time of such sale or assignment, such Assignee provides the Company with replacement Performance Assurances, if applicable, meeting the requirements of Section 4.01(b)), and any such Assignee may further sell or assign such Membership Interest in such Series to any such Person, directly or indirectly through multiple sales or assignment among Affiliates, in each case, without any consent from USG or its Affiliates and without triggering any rights or restrictions under or the provisions of Section 3.03(b)(ii) or, with respect to such Series, during the period commencing on the Effective Date through the twelve-month anniversary of the In-Service Date with respect to the Facilities relating to such Series, Section 3.03(b)(viii). EQT shall promptly provide to the Company and USG copies of the assignment instrument and the ratification instrument associated with each such sale or assignment, and the Members shall amend
Exhibit A
to reflect the Sharing Ratios set forth in such ratification instrument.
(f)
USG
[***]
and Related Assignment Rights
. Notwithstanding anything in this Agreement to the contrary, USG shall have the right from time to time to sell or assign to [***] Person Controlled by USG or its then Parent all or any part of the Membership Interest in a Series then held by USG or its Affiliates (
provided
that, in either case, if such sale or assignment occurs prior to the In-Service Date, then, at the time of such sale or assignment, such Assignee provides the Company with replacement Performance Assurances, if applicable, meeting the requirements of Section 4.01(b)), and any such Assignee may further sell or assign such Membership Interest in such Series to any such Person, directly or indirectly through multiple sales or assignments among Affiliates, in each case, without any consent from EQT or its Affiliates and without triggering any rights or restrictions under or the provisions of Section 3.03(b)(ii) or, with respect to such Series, during the period commencing on the Effective Date through the twelve-month anniversary of the In-Service Date with respect to the Facilities relating to such Series, Section 3.03(b)(viii). USG shall promptly provide to the Company and EQT copies of the assignment instrument and the ratification instrument associated with each such sale or assignment, and the Members shall amend
Exhibit A
to reflect the Sharing Ratios set forth in such ratification instrument.
|
|
3.04
|
Creation of Additional Membership Interests
. With respect to a Series, additional Membership Interests may be created and issued to existing Members or to other Persons ([***]), and such other Persons may be admitted to the Company as Members, with the consent of [***], on such terms and conditions as [***] may determine at the time of admission. The terms of admission or issuance must specify the Sharing Ratios applicable thereto and may provide for the creation of different classes of Members having different rights, powers and duties. Any such admission is effective only after the New Member has executed and delivered to the Members an instrument containing the notice address of the New Member, the Assignee’s ratification of this Agreement and agreement to be bound by it, and its confirmation that the representations and warranties in Section 3.02 are true and correct with respect to it. The provisions of this Section 3.04 shall not apply to Dispositions of Membership Interests or admissions of Assignees in connection therewith, such matters being governed by Sections 3.03(a) and (b).
|
|
|
3.05
|
Access to Information
.
(a)
Each Founding Member of a Series shall be entitled to receive any information that it may request concerning such Series;
provided
that this Section 3.05 shall not obligate the Company, the Series, the Management Committee, or the Operator to create any information that does not already exist at the time of such request (other than to convert existing information from one medium to another, such as providing a printout of information that is stored in a computer database), except as otherwise provided in Section 9.02. Each Founding Member of a Series shall also have the right, upon reasonable notice, and at all reasonable times during usual business hours to inspect the properties of the Series and to audit, examine, and make copies of the books of account and other records of the Series and to have access to the employees of the Operator to discuss the Series’ businesses and financial affairs. Such right may be exercised through any agent or employee of such Founding Member designated in writing by it or by an independent public accountant, engineer, attorney or other consultant so designated. The Founding Member making the request shall bear all costs and expenses incurred in any inspection, examination or audit made on such Founding Member’s behalf. The Founding Members and the Operator agree to reasonably cooperate, and to cause their respective independent public accountants, engineers, attorneys or other consultants to reasonably cooperate, in connection with any such request. Confidential Information obtained pursuant to this Section 3.05(a) shall be subject to the provisions of Section 3.06.
|
(b)
Each New Member shall be entitled to receive only the information and reports set forth in Section 9.02. Confidential Information received pursuant to this Section 3.05(b) shall be subject to the provisions of Section 3.06.
|
|
3.06
|
Confidential Information
.
(a)
Except as permitted by Section 3.06(b), (i) each Member shall keep confidential all Confidential Information and shall not disclose any Confidential Information to any Person, including any of its Affiliates, and (ii) each Member shall use the Confidential Information only in connection with the Facilities and the Company.
|
(b)
Notwithstanding Section 3.06(a), but subject to the other provisions of this Section 3.06, a Member may make the following disclosures and uses of Confidential Information:
(i)
disclosures to another Member or to the Operator in connection with the Company;
(ii)
disclosures and uses that are approved in advance by the Management Committee;
(iii)
disclosures that may be required from time to time to obtain requisite Authorizations or financing for the Facilities, if such disclosures are approved in advance by the Management Committee;
(iv)
disclosures to an Affiliate of such Member, including the directors, officers, members, managers, employees, agents and advisors of such Affiliate, if such Affiliate has agreed to abide by the terms of this Section 3.06;
provided
,
however
, that in no event shall [***];
(v)
disclosures to a Person that is not a Member or an Affiliate of a Member, if such Person has been retained by the Company, a Member, or the Operator to provide services in connection with the Company and has agreed to abide by the terms of this Section 3.06;
(vi)
disclosures to a bona fide potential direct or indirect purchaser of such Member’s Membership Interest, if such potential purchaser has executed a confidentiality agreement in form and substance acceptable to the Management Committee;
(vii)
disclosures required, with respect to a Member or an Affiliate of a Member, pursuant to (i) the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, (ii) the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, (iii) any state securities Laws, or (iv) any national securities exchange or automated quotation system; and
(viii)
disclosures that a Member is legally compelled to make by deposition, interrogatory, request for documents, subpoena, civil investigative demand, order of a court of competent jurisdiction, or similar process, or otherwise by Law or that a Member makes to a Governmental Authority or regulatory authority pursuant to a regulatory request, examination, or audit;
provided
that, prior to any such disclosure, such Member shall, to the extent legally permissible:
(A)
provide the Management Committee with prompt notice of such requirements so that one or more of the Members may seek a protective order or other appropriate remedy or waive compliance with the terms of this Section 3.06(b)(viii);
(B)
consult with the Management Committee on the advisability of taking steps to resist or narrow such disclosure; and
(C)
cooperate with the Management Committee and with the other Members in any attempt one or more of them may make to obtain a protective order or other appropriate remedy or assurance that confidential treatment will be afforded the Confidential Information; and in the event such protective order or other remedy is not obtained, or the other Members waive compliance with the provisions hereof, such Member agrees (1) to furnish only that portion of the Confidential Information that, in the opinion of such Member’s counsel, such Member is legally required to disclose, and (2) to exercise all reasonable efforts to obtain assurance that confidential treatment will be accorded such Confidential Information.
(c)
Each Member shall take such precautionary measures as may be required to ensure (and such Member shall be responsible for) compliance with this Section 3.06 by any of its Affiliates, and its and their directors, officers, employees and agents, and other Persons to which it may disclose Confidential Information in accordance with this Section 3.06.
(d)
Promptly after any Withdrawal or Disposition by any Member of all of its Membership Interests pursuant to Sections 3.03 or 10.02, a Withdrawn Member or Disposing Member, as applicable, shall promptly destroy (and provide a certificate of destruction to the Company with respect to), or return to the Company, all Confidential Information in its possession. Notwithstanding the immediately preceding sentence, but subject to the other provisions of this Section 3.06, a Withdrawn Member or Disposing Member may retain for a stated period, but not disclose to any other Person, Confidential Information for the limited purposes of (i) explaining such Member’s corporate decisions with respect to the Facilities; (ii) preparing such Member’s tax returns and defending audits, investigations and proceedings relating thereto; or (iii) in compliance with such Member’s document retention policy;
provided
that the Withdrawn Member or Disposing Member must notify the Management Committee in advance of such retention and specify in such notice the stated period of such retention.
(e)
The Members agree that no adequate remedy at law exists for a breach or threatened breach of any of the provisions of this Section 3.06, the continuation of which unremedied will cause the Company and the other Members to suffer irreparable harm. Accordingly, the Members agree that the Company and the other Members shall be entitled, in addition to other remedies that may be available to them, to immediate injunctive relief from any breach of any of the provisions of this Section 3.06 and to specific performance of their rights hereunder, as well as to any other remedies available at law or in equity, pursuant to Sections 11.03 and 11.04.
(f)
The obligations of the Members under this Section 3.06 (including the obligations of any Withdrawn Member) shall terminate on the [***] anniversary of the end of the Term.
|
|
3.07
|
Founding Shippers
. Promptly following [***], but in no event later than [***] ([***]) Business Days following the end of such binding open season, each Founding Shipper shall enter into Precedent Agreements for the firm commitment shipping capacity [***].
|
|
|
3.08
|
Liability to Third Parties
. No Member or its Affiliates shall be liable for the debts, obligations or liabilities of the Company or any Series.
|
|
|
3.09
|
Use of Members’ Names and Trademarks
. The Company, a Series, the Members and their Affiliates shall not use the name or trademark of any Member or its Affiliates in connection with public announcements regarding the Company, or marketing or financing activities of the Company, without the prior written consent of such Member or Affiliate.
|
ARTICLE 4
CAPITAL CONTRIBUTIONS/LOANS
|
|
4.01
|
Capital Contributions
.
(c)
(ix)
Promptly following the Approval Date for any Facility, but in any event no later than 120 Days thereafter, EQT shall provide to USG (A) a capital budget covering the design, engineering, procurement, construction and installation of such Facility assigned to the applicable Series through the applicable In-Service Date for such Facility (the “
Construction Budget
”); (B) a schedule (the “
Project Schedule
”) containing milestones and including details to support all major development, engineering, procurement, construction, commissioning and testing activities of such Facility assigned to the applicable Series during the period prior to the applicable In-Service Date for such Facility; and (C) an operating budget covering the [***] period following the In-Service Date for such Facility assigned to the applicable Series (the “
Initial Operating Budget
”). With respect to Series A only, if such Construction Budget, Project Schedule and Initial Operating Budget are not approved by a Supermajority Interest by the [***] Day following the delivery thereof to USG, Series A may be dissolved pursuant to Section 12.01(b)(v).
|
(x)
As to the Construction Budget, the Initial Operating Budget and any Capital Budget associated with any Facility covered by any Approved Precedent Agreement approved by the Management Committee in accordance with Section 6.02(i)(S) or 6.02(i)(GG), no further approval of [***] shall be required for the Capital Contributions required to fund such budget or project as set forth therein, subject to Section 6.02(i)(S) or 6.02(i)(GG); rather, subject to and in accordance with the COM Agreement, the Operator shall issue written notices to the Company for such Capital Contribution and, subject to Sections 6.02(i)(I) and (K), loans from Members, at such times and in such amounts necessary to fund the costs associated with such budget or project.
(xi)
In connection with each individual Capital Call required under the Construction Budget, the Initial Operating Budget, each subsequent Operating Budget, and any Capital Budget associated with a Facility covered by any Approved Precedent Agreement, the Management Committee, by the affirmative vote of [***] of the applicable Series, will determine what portion (if any) of such funding will be made pursuant to Capital Contributions and what portion (if any) of such funding will be made by loans by the Members to the Company. Upon receipt of each notice issued by the Operator pursuant to Section 4.01(a)(ii), the Company shall issue written requests to each Member, consistent with the determination made pursuant to the preceding sentence, for the making of the Capital Contributions and/or loans required in connection with such notice.
(xii)
The Management Committee shall issue or cause to be issued a written request to each Member for the making of Capital Contributions at such times and in such amounts as the Management Committee shall approve or as determined pursuant to Section 4.01(a)(iii) (such written request referred to herein as a “
Capital Call
”). Capital Contributions shall be made by the Members in accordance with their respective Sharing Ratio for such Series. Such Capital Contributions shall be made in cash, unless a Supermajority Interest elects to request non-cash Capital Contributions. All amounts timely received by the Company pursuant to this Section 4.01 shall be credited to the respective Member’s Capital Account with respect to such Series as of such specified date.
(xiii)
Each Capital Call shall contain the following information:
(A)
The total amount of Capital Contributions requested from all Members;
(B)
With respect to the applicable Series, the amount of Capital Contribution requested from the Member to whom the request is addressed, such amount to be in accordance with the Sharing Ratio of such Member for such Series;
(C)
The purpose for which the funds are to be applied in such reasonable detail as the Management Committee shall direct; and
(D)
The date on which payments of the Capital Contribution shall be made (which date shall not be less than 30 Days following the date the Capital Call is given, unless a sooner date is approved by the Management Committee) and the method of payment,
provided
that such date and method shall be the same for each of the Members.
(xiv)
In the event the Management Committee fails to approve an Operating Budget within 30 Days of the submission of such Operating Budget to all of the Representatives on the Management Committee for approval, the Operator is authorized, subject to and in accordance with the COM Agreement, to issue a notice to the Members of such Series for the making of Capital Contributions and/or loans required to fund the costs associated with such Operating Budget in an amount consistent with the Operating Budget most recently approved by the Management Committee of such Series and including costs that do not exceed, for any line item, [***] percent ([***]%) of the amount set forth for such line item in such most recently approved Operating Budget.
(d)
Each Member agrees that it shall make payments of its respective Capital Contributions in accordance with Capital Calls issued pursuant to this Section 4.01. Each Member shall deliver to the applicable Series:
(iii)
within [***] Business Days following the Management Committee’s approval of the Construction Budget of a Series, but in no event later than October 31, 2014 (or, with respect to a New Member admitted after such time but prior to the In-Service Date of the Facilities assigned to such Series, within 10 Business Days of such admission), and for the period up to the issuance of FERC’s initial release to the Company to commence construction pursuant to the applicable FERC Certificate (the “
Initial Release
”), performance assurances (“
Performance Assurances
”) equal to such Member’s share of $[***] (calculated based on such Member’s Sharing Ratio); and
(iv)
within ten (10) Business Days of the date of the Initial Release (or, with respect to a New Member admitted after the Initial Release, within ten (10) Business Days of such admission) for the period following the Initial Release and up to the In-Service Date, Performance Assurances equal to [***] percent ([***]%) of such Member’s remaining obligations to make Capital Contributions to the Series pursuant to this Article 4 (calculated based on such Member’s Sharing Ratio multiplied by the remaining obligations under the applicable Construction Budget and net of any security posted by such Member, or Member’s Affiliate, under any Approved Precedent Agreement).
With respect to the applicable Series, the Company shall be entitled to draw from the Performance Assurances in the event a Member fails to make payments of its respective Capital Contributions in accordance with Capital Calls issued pursuant to this Section 4.01. The Performance Assurances posted by a Member pursuant to this Section 4.01(b) shall be reduced (i) at the end of each Quarter, to reflect the [***] percent ([***]%) of such Member’s actual Capital Contributions made to the Series during such Quarter and (ii) in connection with a Disposition of all or a portion of such Member’s Membership Interest in a Series, to reflect the replacement Performance Assurances to be posted by the Assignee of such Membership Interest pursuant to this Section 4.01(b). Notwithstanding anything to the contrary in this Section 4.01(b), at no time prior to the applicable In-Service Date will a Member’s Performance Assurance obligation be less than such Member’s share of $[***] (calculated based on a Member’s Sharing Ratio). Such Performance Assurances shall be permitted to be in the form of one or more of (A) a full and unconditional written guarantee from a Qualified Guarantor, (B) a Letter of Credit or (C) cash collateral (with the ability to substitute from time to time among (A), (B) or (C)). For the avoidance of doubt, a Member’s obligation to post Performance Assurances pursuant to this Section 4.01(b) shall expire (and any obligations under any posted Performance Assurances shall terminate) on the applicable In-Service Date with respect to the Facilities of a Series.
(e)
In addition to the authority granted the Management Committee in the other provisions of this Section 4.01 to issue Capital Calls, if within [***] Days prior to the date any Matured Financing Obligation is to become due (or within [***] Days after any notice of acceleration of any Matured Financing Obligation received prior to the maturity date thereof), (i) the Management Committee has not made a Capital Call for the payment of such amount that is (or is expected to be) a Matured Financing Obligation, and (ii) the Members have been unable to secure refinancing for such Matured Financing Obligation on reasonably acceptable terms after negotiating in good faith to do so with third-party lender(s), then at any time thereafter, (1) either EQT or USG may, on behalf of the Management Committee, issue a Capital Call for cash in the amount required for the payment of such Matured Financing Obligation, and each Member shall be obligated to pay such Capital Call as provided in this Section 4.01, but such payment shall be made within [***] Days after the date the Capital Call is given (and not the [***] Day period provided for in Section 4.01(a)(v)(D));
provided
that any failure by a Member to make a Capital Contribution with respect to a Capital Call made pursuant to this Section 4.01(c)(1) shall not constitute a Default under or breach of this Agreement; and (2) in the event any Member fails to make a Capital Contribution with respect to a Capital Call made pursuant to Section 4.01(c)(1), on or prior to such [***] Day, then each Founding Member shall have the right, but not the obligation, to pay the portion of the Capital Contribution owed and unpaid to permit the Company to discharge such Matured Financing Obligation. If any Founding Member elects to pay such Matured Financing Obligation pursuant to Section 4.01(c)(2), then such Founding Member will be deemed to be an Additional Contribution/Loan Member with respect to such payment, and its payment of the Matured Financing Obligation shall be treated, at the election of such Additional Contribution/Loan Member, as one of either: (A) a Capital Contribution or loan resulting in the Additional Contribution/Loan Members receiving [***] or (B) a permanent Capital Contribution that results in an adjustment of Membership Interests under Section 4.06(c).
|
|
4.02
|
Loans
.
(g)
If pursuant to Section 4.01(a)(iii) the Management Committee determines as to any individual Capital Call that all or a portion of such Capital Call shall be made by loans from the Members to the Company with respect to the Series, then each Member shall make a loan to the Company with respect to the Series at the time and in the amount and under such terms and conditions as the Management Committee of such Series shall approve by the affirmative vote of a Supermajority Interest.
|
(h)
If the Management Committee determines that the Series needs funds other than as contemplated by Section 4.02(a), then, rather than calling for Capital Contributions, the Management Committee may issue or cause to be issued a written request to each Member for the making of loans to the Company with respect to the Series at such times, in such amounts and under such terms and conditions as the Management Committee of such Series shall approve by the affirmative vote of a Supermajority Interest;
provided
that the Management Committee of such Series shall not call for loans rather than Capital Contributions if doing so would breach any Financing Commitment or other agreement of the Company.
(i)
All amounts received from a Member after the date specified in Section 4.02(d)(iv) by the Company with respect to a Series pursuant to this Section 4.02 shall be accompanied by interest on such overdue amounts (and the default shall not be cured unless such interest is also received by the Company), which interest shall be payable to the Company with respect to such Series and shall accrue from and after such specified date at the Default Rate. Any such interest paid shall not be considered part of the principal of the loan.
(j)
Each written request issued pursuant to Section 4.02(a) or 4.02(b) shall contain the following information:
(i)
The total amount of loans requested from all Members;
(ii)
The amount of the loan requested from the Member to whom the request is addressed, such amount to be in accordance with the Sharing Ratio of such Member in the applicable Series;
(iii)
The purpose for which the funds are to be applied in such reasonable detail as the Management Committee shall direct;
(iv)
The date on which the loans to the Company with respect to such Series shall be made (which date shall not be less than [***] Days following the date the request is given, unless a sooner date is approved by the Management Committee of such Series) and the method of payment;
provided
that such date and method shall be the same for each of the Members; and
(v)
All terms concerning the repayment of or otherwise relating to such loans;
provided
that such terms shall be the same for each of the Members and in the case of costs covered by the Construction Budget shall be consistent with Section 4.01(a)(iii).
(k)
Each Member agrees that it shall make its respective loans in accordance with requests issued pursuant to this Section 4.02.
|
|
4.03
|
No Other Contribution or Loan Obligations
. No Member shall be required or permitted to make any Capital Contributions or loans to the Company with respect to a Series except pursuant to this Article 4.
|
|
|
4.04
|
Return of Contributions
. Except as expressly provided herein, a Member is not entitled to the return of any part of its Capital Contributions or to be paid interest in respect of either its Capital Account or its Capital Contributions. An unreturned Capital Contribution is not a liability of the Company or of any Member. A Member is not required to contribute or to lend any cash or property to the Company to enable the Company to return any Member’s Capital Contributions.
|
|
|
4.05
|
Capital Accounts
.
(g)
A separate Capital Account shall be established and maintained for each Member with respect to each Series. Each Member’s Capital Account with respect to each Series shall be increased by (i) the amount of money contributed by that Member to the Company with respect to the Series; (ii) the fair market value of property contributed by that Member to the Company with respect to the Series (net of liabilities secured by such contributed property that the Company with respect to the Series is considered to assume or take subject to under Section 752 of the Code); (iii) allocations to that Member of income and gain (or items thereof) with respect to the Series, including items specifically allocated to such Member with respect to the Series pursuant to Section 5.04(b) and income and gain exempt from tax and income and gain described in Treasury Regulation Section 1.704-1(b)(2)(iv)(g), but excluding income and gain described in Treasury Regulation Section 1.704-1(b)(4)(i); and (iv) the amount of any liabilities with respect to the Series assumed by such Member and shall be decreased by (v) the amount of money distributed to that Member by the Company with respect to the Series; (vi) the fair market value of property distributed to that Member by the Company with respect to the Series (net of liabilities secured by such distributed property that such Member is considered to assume or take subject to under Section 752 of the Code); (vii) allocations to that Member of expenditures of the Company with respect to the Series described (or treated as described) in Section 705(a)(2)(B) of the Code; (viii) allocations of loss and deduction (or items thereof) with respect to the Series, including items specifically allocated to such Member pursuant to Section 5.04(b) and loss and deduction described in Treasury Regulation Section 1.704-1(b)(2)(iv)(g), but excluding items described in (vi) above and loss or deduction described in Treasury Regulation Section 1.704-1(b)(4)(i) or 1.704-1(b)(4)(iii); and (ix) the amount of any liabilities of such Member assumed by the Company with respect to the Series. The Members’ Capital Accounts with respect to each Series shall also be maintained and adjusted as permitted by the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv)(f) and as required by the other provisions of Treasury Regulation Sections 1.704-1(b)(2)(iv) and 1.704-1(b)(4), including adjustments to reflect the allocations to the Members of depreciation, depletion, amortization, and gain or loss as computed for book purposes rather than the allocation of the corresponding items as computed for tax purposes, as required by Treasury Regulation Section 1.704-1(b)(2)(iv)(g). Thus, in the discretion of the Management Committee, the Members’ Capital Accounts shall be increased or decreased to reflect a revaluation of the property with respect to the Series based on the fair market value of the property on the date of adjustment (as determined pursuant to Section 4.05(b)), immediately prior to (A) the contribution of more than a
de minimis
amount of money or other property to the Company with respect to the Series by a new or existing Member as consideration for a Membership Interest or an increased Sharing Ratio, (B) the distribution of more than a
de minimis
amount of money or other property by the Company with respect to the Series to a Member as consideration for a Membership Interest, or (C) the liquidation of the Series. Except as provided in this Section 4.05 with respect to each separate Capital Account established with respect to each Series, a Member who has more than one Membership Interest shall have a single Capital Account that reflects all such Membership Interests, regardless of the class of Membership Interests owned by such Member and regardless of the time or manner in which such Membership Interests were acquired. Upon the Disposition of all or a portion of a Membership Interest, the Capital Account or Capital Accounts of the Disposing Member that is or are attributable to such Membership Interest shall carry over to the Assignee in accordance with the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv)(l). The Capital Accounts shall not be deemed to be, nor have the same meaning as, the capital account of the Company under the NGA.
|
(h)
Whenever the fair market value of property is required to be determined pursuant to the second and third sentences of Section 4.05(a), the Operator shall propose such a fair market value in a notice to the other Members. If any other Member disagrees with such determination, such Member shall notify the other Members of such disagreement within [***] Business Days of receiving such notice. If such Dispute is not resolved within [***] Business Days after such notice, any Member may submit such Dispute for binding appraisal in accordance with Section 13.11(c) by delivering a FMV Notice to the other Members.
This Section 4.05 is intended to comply with the capital account maintenance provisions of Treasury Regulations Section 1.704-1(b)(2)(iv) and will be applied and interpreted in accordance with such Treasury Regulations.
|
|
4.06
|
Failure to Make a Capital Contribution or Loan
.
|
(a)
General
. If any Member fails to make a Capital Contribution as requested by the Management Committee (or on behalf of the Management Committee pursuant to Section 4.01(c)) in a Capital Call validly and timely issued pursuant to Section 4.01 or a loan when required pursuant to Section 4.02(a) or 4.02(b) (each such Member being a “
Non
-
Contributing/Loan Member
”), and if such failure continues for more than [***] Days after the date on which it is due, the Members that have contributed their Capital Contribution or made their loan, as applicable (each, a “
Contributing/Loan Member
”) may (without limitation as to other remedies that may be available, and in particular such other remedies shall include the right to specifically enforce the obligation of the Non-Contributing/Loan Member to make the required Capital Contribution or loan) thereafter elect to:
(ix)
treat the Non-Contributing/Loan Member’s failure to contribute as a Default by giving notice thereof to the Non-Contributing/Loan Member, in which event the provisions of this Agreement regarding the commission of a Default by a Member shall apply (but if the Capital Call is for the payment of a Matured Financing Obligation, the Default shall be immediate on the giving of such notice and the [***]-Day cure period contemplated in the definition of Default shall not apply); or
(x)
pay the portion of the Capital Contribution owed and unpaid by, or make the loan required from, the Non-Contributing/Loan Member (the “
Additional Contribution/Loan
”) in which event the Contributing/Loan Members that elect to fund the Non-Contributing/Loan Members’ share (the “
Additional Contribution/Loan Members
”) may treat the contribution or loan, as applicable as one of: (1) a Capital Contribution or loan, as applicable, resulting in the Additional Contribution/Loan Members receiving [***] under Section 4.06(b), or (2) a permanent Capital Contribution that results in an adjustment of Membership Interests under Section 4.06(c), as determined by the Additional Contribution/Loan Members as set forth below;
provided
,
however
, that this Section 4.06 shall be applied separately with respect to each Series, as more fully described in this Section 4.06.
No Contributing/Loan Member shall be obligated to make either election under clause (i) or clause (ii) above. The decision of the Contributing/Loan Members to elect (i) or (ii) above shall be made by the determination of the Contributing/Loan Members holding the Supermajority Interest of all Contributing/Loan Members, but clause (ii) above may not be elected unless at such time of determination there is one or more Additional Contribution/Loan Members. The decision of the Additional Contribution/Loan Members to elect clause (ii)(1) or clause (ii)(2) above shall be made by the determination of the Additional Contribution/Loan Members holding the Supermajority Interest of all Additional Contribution/Loan Members. Unless and until such election is made, payment of the Additional Contribution/Loan shall be treated as a Priority Interest under Section 4.06(a)(ii) (1). [***]
(b)
[***]
(i)
[***]
(ii)
[***] shall not alter the Sharing Ratios of the Members, nor shall [***] alter any distributions to the Contributing/Loan Members (in their capacity as Contributing/Loan Members, as opposed to their capacity as Additional Contribution/Loan Members) in accordance with their respective Sharing Ratios. Notwithstanding any provision in this Agreement to the contrary, a Member may not Dispose of all or a portion of [***] except to a Person to whom it Disposes all or the applicable
pro rata
portion of its Membership Interest after compliance with the requirements of this Agreement in connection therewith.
(iii)
For so long as any Additional Contribution/Loan Member holds [***], neither any Non-Contributing/Loan Member nor its Representative (except for a Non-Contributing/Loan Member that has paid to the Additional Contribution/Loan Member(s) all of the amount of the Additional Contribution/Loan attributable to such Non-Contributing/Loan Member in accordance with Section 4.06(b)(i)) shall have the right to vote its Membership Interest (or Sharing Ratio) with respect to the Series under this Agreement with respect to any decision regarding distributions from the Company with respect to the Series, and any distribution to which such Non-Contributing/Loan Member is entitled with respect to the Series shall be paid [***].
(iv)
No Member that is a Non-Contributing/Loan Member may Dispose of its Membership Interest unless, at the closing of such Disposition, either the Non-Contributing/Loan Member or the proposed Assignee pays [***]. No Assignee shall be admitted to the Company as a Member until compliance with this Section 4.06(b)(iv) has occurred.
(c)
Permanent Contribution
. If the Additional Contribution/Loan Members elect under Section 4.06(a)(ii) to have the Additional Contribution/Loan with respect to a Series treated as a permanent Capital Contribution, then the Sharing Ratios of each Member with respect to the Series will be automatically adjusted to equal each Member’s total Capital Contributions with respect to the Series when expressed as a percentage of all Members’ Capital Contributions with respect to the Series (after giving effect to the Capital Contribution made by the Additional Contribution/Loan Members).
(d)
Further Assurance
. In connection with this Section 4.06, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Section 4.06.
(e)
Deemed Non-Contributing/Loan Member
. Notwithstanding anything to the contrary, for purposes of this Agreement the term “Non-Contributing/Loan Member” shall include any Member who (i) fails to vote (through such Member’s Representatives) in favor of a proposed Capital Call under Section 4.01 or a proposed loan pursuant to Section 4.02 and (ii) fails to fund such Capital Call or loan, in each case, to the extent necessary to cover the amount of any Matured Financing Obligation that is to become due within [***] Days or that has become due (by acceleration or otherwise).
(a)
Unless otherwise agreed to by [***], if the Series is required to provide a guaranty, letter of credit or other credit support (each a “
Credit Assurance
”) to a counterparty under any contract or agreement (including an Approved Precedent Agreement) approved by the Management Committee of the Series prior to the In-Service Date of the Facilities of such Series (each a “
Subject Contract
”), then each Member agrees [***].
(b)
If a breach, default or other event occurs under a Subject Contract and the counterparty thereunder makes a demand or draw on one or more Credit Assurances for such breach, default or other event (an “
Demand Event
”), then a determination will be made as to the total dollar amount demanded or drawn by such counterparty for such Demand Event (“
Total Event Demand Amount
”). [***]
(c)
If any Member [***] then such Member [***].
ARTICLE 5
DISTRIBUTIONS AND ALLOCATIONS
|
|
5.01
|
Distributions
. With respect to each Series, within [***] Days following the end of each Quarter following the In-Service Date, the Management Committee shall determine the amount of Available Cash with respect to such Quarter, and an amount equal to 100% of Available Cash with respect to such Quarter shall, subject to Section 18-607 of the Act, be distributed in accordance with this Article 5 to the Members (other than a Breaching Member) in proportion to their respective Sharing Ratios (at the time the amounts of such distributions are made);
provided
,
however
, that, if the Management Committee fails timely to determine the amount of Available Cash with respect to any Quarter following the In-Service Date, an amount equal to [***]% of the Available Cash with respect to the Series determined with respect to the immediately preceding Quarter shall, subject to Section 18-607 of the Act, be distributed in accordance with this Article 5 to the Members (other than a Breaching Member) in proportion to their respective Sharing Ratios with respect to the Series (at the time the amounts of such distributions are made).
|
|
|
5.02
|
[Intentionally omitted.]
|
|
|
5.03
|
[Intentionally omitted.]
|
|
|
5.04
|
Allocations for Maintaining Capital Accounts
.
(i)
For purposes of maintaining the Capital Accounts pursuant to Section 4.05, except as provided in Sections 5.04(b) and (c), each item of income, gain, loss, deduction and credit with respect to each Series shall be allocated to the Members in accordance with their respective Sharing Ratios with respect to the Series, and to the extent such items are not allocable to any particular Series, such items shall be allocated among the various Series by the Management Committee. For the avoidance of doubt, the items described in this Section 5.04 will be allocated to each Series as if such Series was a separate partnership for federal income tax purposes and shall be allocated to the Members associated with each Series on that basis.
|
(j)
With respect to each period during which [***] with respect to an Additional Contribution/Loan treated as a Capital Contribution is outstanding with respect to a Series, each Additional Contribution/Loan Member shall be allocated items of income and gain with respect to the Series in an amount equal to the return that has accrued (whether or not paid) with respect to such Capital Contribution pursuant to Section 4.06(b)(i), and items of income and gain with respect to the Series that would otherwise be allocable to the Non-Contributing/Loan Member(s) shall be correspondingly reduced.
(k)
Notwithstanding the foregoing provisions of Section 5.04, the following special allocations will be made:
(i)
[Intentionally omitted.]
(ii)
Nonrecourse Deductions with respect to any Series shall be allocated to the Members in proportion to their Sharing Ratios with respect to the Series.
(iii)
Member Nonrecourse Deductions with respect to any Series attributable to Member Nonrecourse Debt with respect to the Series shall be allocated to the Members bearing the Economic Risk of Loss for such Member Nonrecourse Debt as determined under Treasury Regulation Section 1.704-2(b)(4). If more than one Member bears the Economic Risk of Loss for such Member Nonrecourse Debt, the Member Nonrecourse Deductions attributable to such Member Nonrecourse Debt shall be allocated among the Members according to the ratio in which they bear the Economic Risk of Loss. This Section 5.04(c)(iii) is intended to comply with the provisions of Treasury Regulation Section 1.704-2(i) and shall be interpreted consistently therewith.
(iv)
Notwithstanding any other provision hereof to the contrary, if there is a net decrease in Minimum Gain with respect to any Series for an allocation period (or if there was a net decrease in Minimum Gain with respect to the Series for a prior allocation period and the Company did not have sufficient amounts of income and gain with respect to the Series during prior periods to allocate among the Members under this Section 5.04(c)(iv), items of income and gain with respect to the Series shall be allocated to each Member in an amount equal to such Member’s share of the net decrease in such Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(g)(2)). This Section 5.04(c)(iv) is intended to constitute a minimum gain chargeback under Treasury Regulation Section 1.704-2(f) and shall be interpreted consistently therewith.
(v)
Notwithstanding any provision hereof to the contrary except Section 5.04(c)(iv) (dealing with Minimum Gain), if there is a net decrease in Member Nonrecourse Debt Minimum Gain with respect to any Series for an allocation period (or if there was a net decrease in Member Nonrecourse Debt Minimum Gain for a prior allocation period and the Company did not have sufficient amounts of income and gain with respect to the Series during prior periods to allocate among the Members under this Section 5.04(c)(v)), items of income and gain with respect to the Series shall be allocated to each Member in an amount equal to such Member’s share of the net decrease in Member Nonrecourse Debt Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(i)(4)). This Section 5.04(c)(v) is intended to constitute a partner nonrecourse debt minimum gain chargeback under Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith.
(vi)
Notwithstanding any provision hereof to the contrary except Section 5.04(c)(ii) and Section 5.04(c)(iii), no losses or other items of expense with respect to any Series shall be allocated to any Member to the extent that such allocation would cause such Member to have a deficit Adjusted Capital Account balance (or increase any existing deficit Adjusted Capital Account balance) with respect to the Series at the end of the allocation period. All losses and other items of expense in excess of the limitation set forth in this Section 5.04(c)(vi) shall be allocated to the Members with interests in the Series who do not have a deficit Adjusted Capital Account balance with respect to the Series in proportion to their relative positive Adjusted Capital Accounts with respect to the Series but only to the extent that such losses and other items of expense do not cause any such Member to have a deficit Adjusted Capital Account balance with respect to the Series.
(vii)
If any Member unexpectedly receives any adjustments, allocations or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6) resulting in or increasing an Adjusted Capital Account deficit for such Member with respect to any Series, items of income and gain with respect to the Series will be specially allocated to such Member in any amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, such Adjusted Capital Account deficit of the Member as quickly as possible;
provided
,
however
, that an allocation pursuant to this Section 5.04(c)(vii) shall be made only if and to the extent that such Member would have a deficit Adjusted Capital Account balance with respect to the Series after all other allocations provided for in this Article 5 have been tentatively made as if this Section 5.04(c)(vii) were not in this Agreement. The items of income or gain to be allocated will be determined in accordance with Treasury Regulations Section 1.704-1(b)(2)(ii)(d). This subsection (vii) is intended to qualify and be construed as a “qualifying income offset” within the meaning of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and will be applied and interpreted in accordance with such Treasury Regulations.
|
|
5.05
|
Allocations for Tax Purposes
.
(f)
Except as provided in Section 5.05(b) and Section 5.05(c) or as otherwise required by the Code or Treasury Regulations, solely for federal income tax purposes, items of taxable income, gain, loss and deduction of the Company with respect to each Series for each fiscal year or other relevant period shall be allocated among the Members in the same manner as each correlative item of “book” income, gain, loss and deduction with respect to the Series is allocated to the Capital Accounts of the Members with respect to the Series pursuant to Section 5.04 and each tax credit shall be allocated to the Members in the same manner as the receipt or expenditure giving rise to such credit is allocated pursuant to Section 5.04.
|
(g)
Income, gain, loss, and deduction with respect to property contributed to the Company with respect to any Series by a Member or revalued pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(f) shall be allocated among the Members in a manner that takes into account the variation between the adjusted tax basis of such property and its book value, as required by Section 704(c) of the Code and Treasury Regulation Section 1.704-1(b)(4)(i), using the remedial allocation method permitted by Treasury Regulation Section 1.704-3(d).
(h)
Pursuant to Treasury Regulations Section 1.1245-1(e), to the extent the Company with respect to any Series recognizes gain as a result of a sale, exchange or other disposition of Company assets with respect to the Series which is taxable as recapture income under Sections 1245 or 1250 of the Code or unrecaptured Section 1250 gain under Section 1(h) of the Code, such recapture income shall be allocated among the Members with respect to the Series in the same proportion as the depreciation and amortization giving rise to such recapture income was allocable among the Members. In no event, however, shall any Member be allocated recapture income hereunder in excess of the amount of gain allocated to the Member under this Agreement. Any recapture income that is not allocated to a Member due to the gain limitation described in the previous sentence shall be allocated among those Members whose shares of total gain on the sale, exchange or other disposition of the property exceed their share of depreciation and amortization attributable to Company or Series assets, in proportion to their relative shares of the total allocable gain.
(i)
Allocations pursuant to this Section 5.05 are solely for federal (and, where applicable, state and local) tax purposes and shall not affect, or in any way be taken into account in computing, any Capital Account or share of income, gain, loss and other deduction described in Section 5.04 or distributions pursuant to any provision of this Agreement.
(j)
The Members are aware of the income and other tax consequences of the allocations made by this Agreement and hereby agree to be bound by the provisions of this Agreement in reporting their shares of items of income, gain, loss, credit and deduction.
|
|
5.06
|
Varying Interests
. All items of income, gain, loss, deduction or credit with respect to each Series shall be allocated, and all distributions shall be made, to the Persons shown on the records of the Company to have been Members with respect to the Series as of the last Day of the period for which the allocation or distribution is to be made. Notwithstanding the foregoing, if during any taxable year there is a change in any Member’s Sharing Ratio with respect to a Series, the Members agree that their allocable shares of such items for the taxable year shall be determined based on any method determined by the Management Committee for such Series to be permissible under Code Section 706 and the related Treasury Regulations to take account of the Members’ varying Sharing Ratios with respect to the Series.
|
|
|
5.07
|
Amounts Withheld
. The Company is authorized to withhold from payments and distributions to the Members and to pay over to any federal, state or local Governmental Authority any amounts required to be so withheld pursuant to the Code or any provisions of any applicable Law and shall allocate such amounts to the Members with respect to which such amounts were withheld. All amounts withheld pursuant to the Code or any provisions of any applicable Law with respect to any payment, distribution or allocation shall be treated for all purposes under this Agreement as amounts paid or distributed pursuant to this Article 5 to the Members with respect to which such amount was withheld. All taxes paid on behalf of such Member pursuant to this Section 5.07 in excess of any distributions otherwise payable to such Member shall, at the option of the Company, (i) be promptly paid to the Company with respect to the applicable Series by such Member or (ii) be repaid by reducing the amount of the current or next succeeding distribution or distributions which would otherwise have been made to such Member or, if such distributions are not sufficient for that purpose, by so reducing the proceeds of liquidation otherwise payable to such Member. Whenever the Company selects option (ii) of the preceding sentence, such Member shall for all purposes of this Agreement be treated as having received a distribution under 5.01 of the amount of the tax payment. To the fullest extent permitted by law, each Member hereby agrees to indemnify and hold harmless the Company and the other Members from and against any liability for taxes (and related interest, penalties or additions to tax) with respect to income attributable to or distributions or other payments to such Member.
|
ARTICLE 6
MANAGEMENT
|
|
6.01
|
Generally
. Except as provided in Section 6.05(a), the management of each Series is fully vested in the Founding Members of such Series. To facilitate the orderly and efficient management of the Series, the Founding Members shall act (a) collectively as a “committee of the whole” pursuant to Section 6.02, and (b) through the delegation of certain duties and authority to the Operator. Subject to the express provisions of this Agreement, each Member agrees that it will not exercise its authority under the Act to bind or commit the Company or any Series to agreements, transactions or other arrangements, or to hold itself out as an agent of the Company or any Series.
|
|
|
6.02
|
Management Committee
. The Founding Members shall act collectively through meetings as a “committee of the whole,” which is hereby named the “
Management Committee
.” Decisions or actions taken by the Management Committee in accordance with the provisions of this Agreement shall constitute decisions or actions by the Company and shall be binding on each Member, Representative, and employee of the Company. The Management Committee shall conduct its affairs in accordance with the following provisions and the other provisions of this Agreement:
|
(xi)
Designation
. To facilitate the orderly and efficient conduct of Management Committee meetings, each Founding Member (together with its Affiliates who are also Founding Members, if any) shall notify the other Founding Member(s), from time to time, of the identity of (A) one of its senior officers, who will represent it at such meetings (a “
Representative
”), and (B) at least one, but not more than two, additional senior officers, who will represent it at any meeting that the Founding Member’s Representative is unable to attend (each an “
Alternate Representative
”). (The term “
Representative
” shall also refer to any Alternate Representative that is actually performing the duties of the applicable Representative.) [***]. The initial Representative and Alternate Representatives of each Founding Member are set forth in
Exhibit A
. A Founding Member may designate a different Representative or Alternate Representatives for any meeting of the Management Committee by notifying the other Founding Member(s) at least [***] Business Days prior to the scheduled date for such meeting;
provided
that, if giving such advance notice is not feasible, then such new Representative or Alternate Representatives shall present written evidence of his or her authority at the commencement of such meeting.
(xii)
Authority
.
Each Representative shall have the full authority to act on behalf of the Founding Member that designated such Representative; the action of a Representative at a meeting (or through a written consent) of the Management Committee shall bind the Founding Member that designated such Representative; and the other Members of the applicable Series shall be entitled to rely upon such action without further inquiry or investigation as to the actual authority (or lack thereof) of such Representative. In addition, the act of an Alternate Representative shall be deemed the act of the Representative for which such Alternate Representative is acting, without the need to produce evidence of the absence or unavailability of such Representative.
(xiii)
DISCLAIMER OF DUTIES; INDEMNIFICATION
.
EACH REPRESENTATIVE SHALL REPRESENT, AND OWE DUTIES TO, ONLY THE MEMBER THAT DESIGNATED SUCH REPRESENTATIVE (THE NATURE AND EXTENT OF SUCH DUTIES BEING AN INTERNAL AFFAIR OF SUCH MEMBER), AND SHALL NOT OWE ANY DUTIES (INCLUDING FIDUCIARY DUTIES) TO THE COMPANY, ANY OTHER MEMBER OR REPRESENTATIVE, OR ANY AFFILIATE, OFFICER, OR EMPLOYEE OF THE COMPANY, ANY OTHER MEMBER, OR ANY OTHER PERSON. THE PROVISIONS OF SECTIONS 6.02(f)(ii) AND 6.04 SHALL ALSO INURE TO THE BENEFIT OF EACH MEMBER’S REPRESENTATIVE. THE COMPANY SHALL INDEMNIFY, PROTECT, DEFEND, RELEASE AND HOLD HARMLESS EACH REPRESENTATIVE FROM AND AGAINST ANY CLAIMS ASSERTED BY OR ON BEHALF OF ANY PERSON (INCLUDING ANOTHER MEMBER), OTHER THAN THE MEMBER THAT DESIGNATED SUCH REPRESENTATIVE, THAT ARISE OUT OF, RELATE TO, OR ARE OTHERWISE ATTRIBUTABLE TO, DIRECTLY OR INDIRECTLY, THE COMPANY OR SUCH REPRESENTATIVE’S SERVICE ON THE MANAGEMENT COMMITTEE.
(xiv)
Attendance
.
Each Founding Member shall use all reasonable efforts to cause its Representative or Alternate Representative to attend each meeting of the Management Committee, unless its Representative is unable to do so because of a “force majeure” event or other event beyond his reasonable control, in which event such Founding Member shall use all reasonable efforts to cause its Representative or Alternate Representative to participate in the meeting by telephone pursuant to Section 6.02(h).
(d)
Secretary
. The Management Committee may designate a Secretary of the Management Committee, who need not be a Representative or an employee of a Member or any Affiliate thereof.
(e)
Procedures
. The Secretary, or if no Secretary has been appointed, a person designated in writing by the Representatives, of the Management Committee shall maintain written minutes of each meeting held by the Management Committee. The Management Committee may adopt whatever rules and procedures relating to its activities as it may deem appropriate,
provided
that such rules and procedures shall not be inconsistent with or violate the provisions of this Agreement.
(f)
Time and Place of Meetings
. The Management Committee shall meet quarterly, subject to more or less frequent meetings upon approval of the Management Committee. Notice of, and an agenda for, all Management Committee meetings shall be provided by the Representatives to all Members at least five Days prior to the date of each meeting, together with proposed minutes of the previous Management Committee meeting (if such minutes have not been previously ratified). Among other items, the agenda will provide for a discussion of (i) the results of operations, including explanations of significant variances in revenues, expenses and cash flow activities and (ii) amounts due for contractual obligations that will impact Available Cash. Special meetings of the Management Committee may be called at such times, and in such manner, as any Founding Member reasonably deems necessary;
provided
,
however
, that a Founding Member may only call a special meeting of the Management Committee with respect to a Series for which that Founding Member owns a Membership Interest. Any Founding Member calling for any such special meeting shall notify the Representatives, who in turn shall notify all Founding Members of the date and agenda for such meeting at least five Days prior to the date of such meeting. Such five-Day period may be shortened by the Management Committee, acting through Supermajority Interest. All meetings of the Management Committee shall be held at a location agreed upon by the Representatives. Attendance of a Representative of a Founding Member at a meeting of the Management Committee shall constitute a waiver of notice of such meeting, except where such Representative attends the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.
(g)
Quorum
. The presence of Representative(s) of Founding Members representing Supermajority Interest shall constitute a quorum for the transaction of business at any meeting of the Management Committee.
(vi)
Voting by Sharing Ratios
. Subject to Section 6.05(a), voting on all matters shall be effected on a Series basis, with a separate vote taken with respect to each Series affected by the matter to be decided;
provided
that, in any matter pertaining to multiple Series, a Series shall only be bound in such matter if the Management Committee voting in respect of such Series has approved such matter. Subject to Sections 6.02(j), 6.05(a), and 6.05(e), each Representative shall be entitled to vote on all matters submitted to a vote of the Management Committee in respect of a particular Series in accordance with the respective Sharing Ratio with respect to such Series of the Founding Member that designated such Representative.
(vii)
DISCLAIMER OF DUTIES
.
WITH RESPECT TO ANY VOTE, CONSENT OR APPROVAL AT ANY MEETING OF THE MANAGEMENT COMMITTEE OR OTHERWISE UNDER THIS AGREEMENT, EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED IN SECTION 6.02(j) AND SECTION 6.05(e) OF THIS AGREEMENT, EACH REPRESENTATIVE MAY GRANT OR WITHHOLD SUCH VOTE, CONSENT OR APPROVAL (A) IN ITS SOLE AND ABSOLUTE DISCRETION, (B) WITH OR WITHOUT CAUSE, (C) SUBJECT TO SUCH CONDITIONS AS IT SHALL DEEM APPROPRIATE, AND (D) WITHOUT TAKING INTO ACCOUNT THE INTERESTS OF, AND WITHOUT INCURRING LIABILITY TO, THE COMPANY, A SERIES, ANY OTHER MEMBER OR REPRESENTATIVE, OR ANY AFFILIATE, OFFICER, OR EMPLOYEE OF THE COMPANY, ANY SERIES OR ANY OTHER MEMBER (COLLECTIVELY, “
SOLE DISCRETION
”). THE PROVISIONS OF THIS SECTION 6.02(f)(ii) SHALL APPLY NOTWITHSTANDING THE NEGLIGENCE, GROSS NEGLIGENCE, WILLFUL MISCONDUCT, STRICT LIABILITY OR OTHER FAULT OR RESPONSIBILITY OF A MEMBER OR ITS REPRESENTATIVE.
(viii)
Exclusion of Certain Members and Their Sharing Ratios
.
With respect to any vote, consent or approval, any Breaching Member or Withdrawn Member (and any Representative of such Breaching Member or Withdrawn Member) shall be excluded from such decision (as contemplated by Section 10.03(b)), and the Sharing Ratio of such Breaching Member or Withdrawn Member shall be disregarded in calculating the voting thresholds in Section 6.02(f)(i). In addition, if any other provision of this Agreement provides that a Supermajority Interest is to be calculated without reference to the Sharing Ratio of a particular Founding Member, then the applicable voting threshold shall be deemed adjusted accordingly.
(i)
Action by Written Consent
. Any action required or permitted to be taken at a meeting of the Management Committee may be taken without a meeting, without prior notice, and without a vote if a consent or consents in writing, setting forth the action so taken, is signed by the Representatives that could have taken the action at a meeting of the Management Committee.
(j)
Meetings by Telephone
. Representatives may participate in and hold such meeting by means of conference telephone, videoconference or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in such a meeting shall constitute presence in person at such meeting, except where a Representative participates in the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.
(k)
Matters Requiring Approval of the Management Committee
. Notwithstanding any other provision of this Agreement, but subject to Section 6.05(e), none of the following actions may be taken by, or on behalf of, a Series without first obtaining the approval of a Supermajority Interest of the Management Committee:
(A)
with respect to each Series, conducting any activity or business that, in the reasonable judgment of the Operator acting in good faith, may generate income for federal income tax purposes that may not be “qualifying income” (as such term is defined pursuant to Section 7704 of the Code) in excess of [***]% of the gross income of the Series;
(B)
any material tax elections or any material decisions relating to material tax returns, in each case, as determined in the reasonable judgment of the Operator acting in good faith;
(C)
considering at a meeting of the Management Committee a material matter not on the agenda for that meeting;
(D)
entering into, amending in any material respect, or terminating any Material Contract, or taking any action that results in a material default under any Material Contract;
(E)
approving any material loans made by the Series or the provision of any material financial guarantees by the Series, except to the extent such material loans or material financial guarantees have been specifically included in and approved as part of the Construction Budget, the Initial Operating Budget, or any subsequent annual Capital Budget or Operating Budget that has been approved by the Management Committee;
(F)
placing or permitting any liens or other encumbrances (other than Permitted Encumbrances) to exist on the assets of the Series;
(G)
[***]
(H)
[***]
(I)
[***]
(J)
[***]
(K)
[***]
(L)
except as otherwise provided in Section 4.01(a)(ii) making a Capital Call or otherwise requiring any Member to make any Capital Contribution, except to the extent such Capital Call or Capital Contribution has been specifically included in and approved as part of the Construction Budget, the Initial Operating Budget, or any subsequent annual Capital Budget or Operating Budget that has been approved by the Management Committee;
(M)
[***]
(N)
selecting a different name for the Company, or making any change to the principal nature of the business of the Company;
(O)
[***]
(P)
[***]
(Q)
approving accounting procedures for the Series in accordance with GAAP, or voluntarily changing or terminating the appointment of the Series’ accountants;
(R)
[***]
(S)
[***]
(T)
[***]
(U)
[***]
(V)
on the occurrence of a Dissolution Event, the designation of a Member or other Person to serve as liquidator pursuant to Section 12.02;
(W)
the commencement, conduct or settlement of any suit, action or proceeding or arbitration, each involving in excess of $[***];
(X)
the formation of any subcommittee of the Management Committee pursuant to Section 6.02(k);
(Y)
termination of a Series pursuant to Section 12.01(a)(i);
(Z)
causing or permitting the Series to become Bankrupt (but this provision shall not be construed to require any Member to ensure the profitability or solvency of the Series);
(AA)
the Disposition or abandonment of all or substantially all of the Series’ assets, or of the Series’ material assets other than any Disposition(s) in the ordinary course of business;
(BB)
causing or permitting the Company to merge, consolidate or convert into any other entity;
(CC)
[***]
(DD)
approving the FERC Application pursuant to Section 7.01(a);
(EE)
making any decision required pursuant to Sections 7.01(b), (c) or (d);
(FF)
[***]
(GG)
[***]
(HH)
[***]
(II)
[***]
(JJ)
[***]
(l)
Reasonableness
. In any matter proposed to the Management Committee pursuant to [***].
(m)
Subcommittees
. The Management Committee may create such subcommittees, and delegate to such subcommittees such authority and responsibility, and rescind any such delegations, as it may deem appropriate.
(n)
Officers
. The Management Committee may designate one or more Persons to be officers of a Series. Any officers so designated shall have such titles and, subject to the other provisions of this Agreement, have such authority and perform such duties as the Management Committee may delegate to them and shall serve at the pleasure of the Management Committee and report to the Management Committee.
|
|
6.03
|
Construction, Operation and Management Agreement
. The Company shall enter into a Construction, Operation and Management Agreement with Operator (the “
COM Agreement
”) in such form as shall be approved by the Founding Members.
|
|
|
6.04
|
No Duties; Disclaimer of Duties
. Each Member acknowledges its express intent, and agrees with each other Member for the mutual benefit of all the Members, that
|
(k)
to the fullest extent permitted by applicable Law, no Member, in its capacity as Member, nor any of such Member’s or any of its Affiliates’ respective employees, agents, directors, managers or officers shall have any fiduciary duty to the Company, any Series, any other Member or Representative or any other Person in connection with the business and affairs of the Company or a Series or any consent or approval given or withheld pursuant to this Agreement;
provided
,
however
, that nothing herein shall eliminate the implied contractual covenant of good faith and fair dealing;
(l)
to the fullest extent permitted by applicable Law, no Representative, in such Person’s capacity as a Representative, shall have any fiduciary duty to the Company, any Series, any Member (other than the Member that designated such Representative), any other Representative, or any other Person in connection with the business and affairs of the Company or any Series or any consent or approval given or withheld pursuant to this Agreement;
provided
,
however
, that nothing herein shall eliminate the implied contractual covenant of good faith and fair dealing; and
(m)
the provisions of this Section 6.04 will apply for the benefit of each Member, and no standard of care, duty, or other legal restriction or theory of liability shall limit or modify the right of each Member to act and direct its Representative to vote in the manner determined by the Member that designated such Representative in its Sole Discretion.
To the maximum extent permitted by applicable Law, each Member hereby releases and forever discharges each other Member and such other Member’s Representative from all liabilities that such other Member or its Representative might owe, under the Act or otherwise, to the Company, the releasing Member, or such releasing Member’s Representative on the ground that any decision of that other Member or such other Member’s Representative to grant or withhold any vote, consent or approval constituted the breach or violation of any standard of care, any fiduciary duty or other legal restriction or theory of liability applicable to such other Member or its Representative;
provided
,
however
, that nothing herein shall eliminate any Member’s liability for any act or omission that constitutes a bad faith violation of the implied contractual covenant of good faith and fair dealing. Notwithstanding anything in this Agreement to the contrary, nothing in this Section 6.04 shall limit or waive any claims against, actions, rights to sue, other remedies or other recourse of the Company, any Member or any other Person may have against any Member, Representative or employee of the Company for a breach of contract claim relating to any binding agreement.
|
|
6.05
|
Business Opportunities
.
|
(d)
During the Term, except as otherwise provided in Section 6.05(f) [***], any project involving the planning, design, construction, acquisition, ownership, maintenance, or operation of the Facilities may be conducted only by the Company through a Series and not by any Member or any Affiliate of a Member;
provided
that the Management Committee may, pursuant to Section 6.02(KK), determine that one or more Additional Facilities shall be owned and conducted by EQT and USG (or their Affiliates) through an Additional Joint Venture LLC [***], and the operating agreement of any such Additional Joint Venture LLC shall be substantially in the form attached hereto as
Exhibit B
. [***]. If such Representative shall elect to cause the Company to pursue such natural gas pipeline (each, including the construction, installation, operation, and maintenance of which, an “
Additional Facility
”), then the Management Committee shall create a separate Series pursuant to Section 3.01(b) to hold the Company’s right, title and interest in and to such Additional Facility and shall determine the terms of, and issue, additional Membership Interests in such Series in accordance with the terms of Sections 3.01(b) and 6.02((i)(G), [***].
(e)
A Member and each Affiliate of a Member may engage in and possess interests in other business ventures of any and every type and description, independently or with others, including ones in competition with the Company, with no obligation to offer to the Company, any other Member or any Affiliate of another Member the right to participate therein. Subject to Section 6.02(i)(HH), the Company may transact business with any Member or Affiliate thereof. Without limiting the generality of the foregoing, the Members recognize and agree that their respective Affiliates currently engage in certain activities involving natural gas and electricity marketing and trading (including futures, options, swaps, exchanges of future positions for physical deliveries and commodity trading), gathering, processing, storage, transportation and distribution, electric generation, development and ownership, as well as other commercial activities related to natural gas and that these and other activities by Members’ Affiliates may be based on natural gas that is shipped through the Facilities or otherwise made possible or facilitated by reason of the Company’s activities (herein referred to as “
Affiliate
’
s Outside Activities
”). No Affiliate of a Member shall be restricted in its right to conduct, individually or jointly with others, for its own account any Affiliate’s Outside Activities, and no Member or its Affiliates shall have any duty or obligation, express or implied, fiduciary or otherwise, to account to, or to share the results or profits of such Affiliate’s Outside Activities with, the Company, any other Member or any Affiliate of any other Member, by reason of such Affiliate’s Outside Activities. The provisions of this Section 6.05(b) and Sections 6.02(a)(iii), 6.02(f)(ii), 6.04, 6.05(d), 6.05(e), and 6.07(a) constitute an agreement to modify or eliminate, as applicable, fiduciary duties pursuant to the provisions of Section 18-1101 of the Act.
|
|
(f)
|
Subject to Section 6.05(a), each Member:
|
(i)
renounces in advance each and every interest or expectancy it or any of its Affiliates might be considered to have under the Act, at common law or in equity by reason of its membership in the Company in any business opportunity, or in any opportunity to participate in any business opportunity, in any business or industry in which any other Member or its Affiliates now or in the future engages, which is presented to the Company, to any other Member or any of its Affiliates or to any present or future partner, member, director, officer, manager, supervisor, employee, agent or representative of the Company or of any other Member or any of its Affiliates; and
(ii)
waives and consents to [***].
|
|
(g)
|
Subject to Section 6.05(a), the Company:
|
(i)
renounces in advance each and every interest or expectancy it might be considered to have under the Act, at common law or in any business opportunity, or in any opportunity to participate in any business opportunity, in any business or industry in which any Member or any of its Affiliates now or in the future engages, which is presented to such Member or any of its Affiliates or to any present or future partner, member, director, officer, manager, supervisor, employee, agent or representative of such Member or any of its Affiliates; and
(ii)
waives and consents to [***].
(h)
Notwithstanding any other provision in this Agreement, with respect to a Related Party Matter, the Representative of the Founding Member who is, or whose Affiliate is, involved in such Related Party Matter [***].
(i)
[***]
|
|
6.06
|
Insurance Coverage
.
|
(a)
Operator Insurance
. Pursuant to the COM Agreement, the Operator is required to carry and maintain or cause to be carried and maintained certain liability insurance coverages.
(b)
Owner Insurance
. The Management Committee shall determine the type limits, deductibles and other terms applicable to the insurance coverages to be maintained by each Series, and such Series shall engage an insurance broker to provide recommendations and to procure such insurance coverages on behalf of the Series.
(c)
Claim for Property Loss or Damage
. In the event of actual loss or damage to a Series’ property or any incident reasonably anticipated to give rise to a claim for loss or damage to the Series’ property, the Series shall promptly provide written notice to the Members of such loss, damage or incident. The Series shall take all actions necessary to provide proper and timely notification to its insurers of such loss, damage or incident. The Series shall be responsible for the preparation, submittal and negotiation of all insurance claims related to any loss, damage or incident involving the Series’ property. The Members of such Series each agree to use all reasonable efforts to cooperate with each other and the Series in the preparation, submittal and negotiation of all such claims by the Series, including, but not limited to, the assignment of adjusters and the provision and exchange of information related to any loss, damage or incident involving the Series’ property.
(d)
Directors’ and Officers’ Liability
. Each Member shall carry and maintain Directors’ and Officers’ Liability insurance covering its own respective persons who are serving as officers, directors, Representatives or Management Committee members of a Series. Each Member shall also be responsible for insuring its respective Membership Interest in a Series for securities claims against such Series.
(a)
Subject to Section 6.07(b), to the fullest extent permitted by the Act, each Series shall indemnify and hold harmless each Representative and each Member and the managers, officers, directors, stockholders, partners, members, managers, employees, affiliates, representatives and agents of such Member, as well as each officer, employee, representative, and agent of the Series (individually, a “
Covered Person
”) from and against any and all Claims in which the Covered Person may be involved, or threatened to be involved, as a party or otherwise, by reason of the fact that he or it is a Covered Person or which relates to or arises out of the Series or its property, business or affairs. A Covered Person shall not be entitled to indemnification under this Section 6.07(a) with respect to [***].
(b)
Notwithstanding the obligations of the Series pursuant to Section 6.07(a) and subject to Section 6.08, each Member shall indemnify, protect, defend, release and hold harmless the Company, each Series and each other Member, its Representative, its Affiliates, and its and their respective directors, officers, trustees, employees and agents from and against [***].
|
|
6.08
|
Limitation on Liability
. EXCEPT IN CONNECTION WITH INDEMNIFICATION OBLIGATIONS ARISING FROM AN ACTION OR PROCEEDING BROUGHT BY A THIRD PARTY FOR AMOUNTS PAID OR OWING TO SUCH THIRD PARTY, EACH MEMBER AGREES THAT NO MEMBER SHALL BE LIABLE UNDER THIS AGREEMENT FOR EXEMPLARY, INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES WHICH IN ANY WAY ARISE OUT OF, RELATE TO, OR ARE A CONSEQUENCE OF, ITS PERFORMANCE OR NONPERFORMANCE HEREUNDER, OR THE PROVISION OF OR FAILURE TO PROVIDE ANY SERVICE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, LOSS OF FUTURE PROFITS, BUSINESS INTERRUPTIONS, AND LOSS OF CUSTOMERS, WHETHER SUCH DAMAGES ARE ASSERTED IN AN ACTION BROUGHT IN CONTRACT, IN TORT OR PURSUANT TO SOME OTHER THEORY, AND WHETHER THE POSSIBILITY OF SUCH DAMAGES WAS MADE KNOWN OR WAS FORESEEABLE.
|
|
|
6.09
|
Delivery of Operating Budget
.
On or prior to [***] of each year, the Operator shall deliver a draft annual Operating Budget for the following year to each of the Representatives, which Representatives will have [***] Days to provide comments (the “
Comment Deadline
”) on such draft annual Operating Budget (such comments, the “
Representative Budget Comments
”). The Operator shall make a good faith effort to respond to, and incorporate into such draft annual Operating Budget, the Representative Budget Comments and shall deliver to each of the Representatives the final annual Operating Budget for the following year on or before [***] (the “
December Deadline
”) of each year;
provided
,
however
, that, if the board of directors of the Operator has not convened to approve the annual Operating Budget by [***] of a given year, then the December Deadline shall be extended to [***] of such year;
provided
,
further
, that, if the meeting of the board of directors of the Operator to approve the annual Operating Budget is scheduled prior to the Comment Deadline, the Operator shall promptly notify the Representatives in writing of the date and time of such meeting (but no less than [***] Business Days in advance of such meeting), and the Representatives shall use reasonable efforts to provide the Representative Budget Comments in advance of such meeting. The Operator and the Representatives shall work together in good faith to cause the Operating Budget to be approved by [***] of such year.
|
ARTICLE 7
DEVELOPMENT OF FACILITIES
|
|
7.01
|
Development of Facilities
.
|
(o)
FERC Application
. Pursuant to the terms of the COM Agreement, USG, EQT, and the Operator shall jointly prepare and submit to the Management Committee the proposed FERC Application related to the Facilities assigned to a Series; and, following the approval of the FERC Application by the Management Committee, USG, EQT, and the Operator shall, on behalf of the Company, file the FERC Application with the FERC.
(p)
Approval of FERC Certificate
. No later than [***] Days prior to the FERC Response Date, the Management Committee shall vote on whether the FERC Certificate for the Facilities assigned to a Series is issued on terms and conditions which are not materially different from those requested in a FERC Application for such Facilities and whether the Company shall (i) accept the FERC Certificate for the applicable Facilities without seeking rehearing; (ii) accept such FERC Certificate and seek rehearing of the order issuing the FERC Certificate; (iii) file for rehearing before committing to accept or reject the FERC Certificate; or (iv) reject such FERC Certificate. The Management Committee shall be deemed to have approved the FERC Certificate for the applicable Facilities if the Management Committee determines that such certificate is issued on terms and conditions which are not materially different from those requested in the FERC Application for the applicable Facilities. In such event the Management Committee shall accept the FERC Certificate prior to the FERC Response Date with or without seeking rehearing of the order issuing the FERC Certificate for the applicable Facilities. In such event, subject to the terms of this Agreement, each Member shall be firmly committed to the construction of the applicable Facilities and the construction of the applicable Facilities shall not be subject to any conditions precedent, including but not limited to Management Committee approval of any financial commitment for obtaining funds to finance the applicable Facilities or the Management Committee approval to construct the applicable Facilities.
(q)
If the Management Committee finds that the FERC Certificate for the applicable Facilities is issued on terms and conditions which are materially different from those requested in the FERC Application and EQT and USG vote to accept the order issuing the FERC Certificate with or without seeking rehearing, then the Management Committee and the applicable Series shall accept the FERC Certificate prior to the FERC Response Dates, and in such event, and subject to the terms of this Agreement, each Member shall be firmly committed to the construction of the applicable Facilities and the construction of the applicable Facilities shall not be subject to any conditions precedent as provided in Section 7.01(b).
(r)
If the Management Committee finds that the FERC Certificate for the applicable Facilities is issued on terms and conditions which are materially different from those requested in the FERC Application for the applicable Facilities and [***]. In the event no Member votes to accept the order issuing the FERC Certificate for the Facilities, then such vote shall be a Dissolution Event with respect to the Series and the Series shall dissolve and its offices shall be wound up pursuant to Article 12.
|
|
7.02
|
Employee Matters
. To facilitate placing the Facilities assigned to a Series in service, a Founding Member that is not, or does not have an Affiliate that is, the Operator shall have the right to have one (1) employee located in the Operator’s primary place of business with respect to the Facilities and any construction or engineering site until the In-Service Date for such Facilities, and such employee shall have access to all construction and engineering offices related to the Facilities and shall be permitted to review, examine, and copy the books, records, plans, reports, forecasts, studies, budgets, and other information related to such Facilities.
|
|
|
7.03
|
General Regulatory Matters
.
|
(n)
The Members acknowledge that either the Company will be a “natural gas company” as defined in Section 2(6) of the NGA or the assets of the Company will be operated by a “natural gas company” as defined in Section 2(6) of the NGA in accordance with the certificate of authority granted by the FERC.
(o)
Each Member shall (i) cooperate fully with the Company, the Management Committee, USG, EQT, and the Operator in securing the Necessary Regulatory Approvals, including supporting all FERC Applications, and in connection with any reports prescribed by the FERC and any other Governmental Authority having jurisdiction over the Company; (ii) join in any eminent domain takings by the Company, to the extent, if any, required by Law; and (iii) without limiting or modifying Section 6.04 or 6.05, devote such efforts as shall be reasonable and necessary to develop and promote the Facilities for the benefit of the Company, taking into account such Member’s Sharing Ratio, resources, and expertise.
ARTICLE 8
TAXES
|
|
8.01
|
Tax Returns
. Except as otherwise required by any final Treasury Regulations, each Member, each Series, and the Company shall treat each Series as an entity formed under local law for federal (and, where applicable, state and local) tax purposes and shall file tax returns for or with respect to each Series accordingly. Operator shall prepare and timely file (on behalf of the Company and any such Series) all federal, state and local tax returns required to be filed by the Company or with respect to each such Series;
provided
that so long as USG is a Founding Member with respect to the Series to which a material tax return relates, USG shall have the right to review and comment on such material return at least 25 Days prior to the relevant due date for such return (which return may be provided to USG in draft form) and that the Operator shall include any such timely received comments as are reasonable, subject to applicable Law and to any ethical obligations of a return preparer. Each Member shall furnish to Operator all pertinent information in its possession relating to the Company’s operations and the operations of each Series that is necessary to enable such tax returns to be timely prepared and filed. The Company shall bear the costs of the preparation and filing of its returns.
|
|
|
8.02
|
Tax Elections
. The Company or each Series shall make the following elections on the appropriate tax returns:
|
|
|
(p)
|
to adopt the calendar year as the Company’s and each Series’ fiscal and taxable year;
|
|
|
(q)
|
to adopt the accrual method of accounting;
|
|
|
(r)
|
to make the election described in Code Section 754 with respect to the first taxable year of the Company and each Series;
|
|
|
(s)
|
to elect to deduct or amortize the organizational expenses of the Company and each Series in accordance with Section 709(b) of the Code and to depreciate property pursuant to the most rapid depreciation or cost recovery method available; and
|
|
|
(t)
|
any other election the Management Committee for each Series may deem appropriate or that the Operator is permitted to make without Management Committee approval in accordance with Section 6.02(i)(B).
|
Notwithstanding the foregoing, however, none of the Company, any Series or any Member shall make an election for the Company or any Series to be excluded from the application of the provisions of subchapter K of chapter 1 of subtitle A of the Code or elect for the Company or any Series to be treated as an association taxable as a corporation or any similar provisions of applicable state law and no provision of this Agreement shall be construed to sanction or approve such an election.
|
|
8.03
|
Tax Matters Member
.
(j)
EQT shall serve as the “tax matters partner” of the Company and each Series pursuant to Section 6231(a)(7) of the Code (the “
Tax Matters Member
”). The Tax Matters Member shall take such action as may be necessary to cause to the extent possible each other Member to become a “notice partner” within the meaning of Section 6223 of the Code. The Tax Matters Member shall inform each other Member of all significant matters that may come to its attention in its capacity as Tax Matters Member by giving notice thereof on or before the fifth Business Day after becoming aware thereof and, within that time, shall forward to each other Member copies of all significant written communications it may receive from a taxing authority in that capacity. In the event that EQT ceases to be the Tax Matters Member (or any successor Tax Matters Member ceases to be a Member), the Management Committee shall appoint a successor Tax Matters Member.
|
(k)
The Tax Matters Member shall provide any Member, upon reasonable request, access to accounting and tax information and schedules obtained by the Tax Matters Member solely in its capacity as Tax Matters Member as shall be necessary for the preparation by such Member of its income tax returns and such Member’s tax information reporting requirements.
(l)
The Tax Matters Member shall take no action in its capacity as Tax Matters Member without the authorization of the Management Committee, other than such action as may be required by Law. Any cost or expense incurred by the Tax Matters Member in connection with its duties, including the preparation for or pursuance of administrative or judicial proceedings and in complying with Section 8.03(b), shall be paid by the Company.
(m)
The Tax Matters Member shall not enter into any extension of the period of limitations for making assessments on behalf of the Members without first obtaining the consent of the Management Committee. The Tax Matters Member shall not bind any Member to a settlement agreement without obtaining the consent of such Member. Any Member that enters into a settlement agreement with respect to any partnership item (as described in Code Section 6231(a)(3)) with respect to the Company or any Series shall notify the other Members of such settlement agreement and its terms within [***] Days from the date of the settlement.
(n)
No Member shall file a request pursuant to Code Section 6227 for an administrative adjustment of Company items or items of any Series for any taxable year without first notifying the other Members no later than [***] Days prior to filing such request. If the Management Committee consents to the requested adjustment, the Tax Matters Member shall file the request for the administrative adjustment on behalf of the Members. If such consent is not obtained within [***] Days from such notice, any Member, including the Tax Matters Member, may file a request for administrative adjustment on its own behalf. Any Member intending to file a petition under Code Sections 6226, 6228 or other Code Section with respect to any item involving the Company shall notify the other Members of such intention and the nature of the contemplated proceeding. In the case where the Tax Matters Member is the Member intending to file such petition on behalf of the Company or any Series, such notice shall be given within a reasonable period of time to allow the other Members to participate in the choosing of the forum in which such petition will be filed.
(o)
If any Member intends to file a notice of inconsistent treatment under Code Section 6222(b), such Member shall give reasonable notice under the circumstances to the other Members of such intent and the manner in which the Member’s intended treatment of an item is (or may be) inconsistent with the treatment of that item by the other Members.
ARTICLE 9
BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
|
|
9.01
|
Maintenance of Books
.
(u)
The Operator shall keep or cause to be kept at the principal office of the Company or at such other location approved by the Management Committee complete and accurate books and records of the Company and each Series, including all books and records necessary to provide to the Members any information required to be provided pursuant to Section 9.02, supporting documentation of the transactions with respect to the conduct of the Company’s and Series’ business and minutes of the proceedings of its Members and the Management Committee, and any other books and records that are required to be maintained by applicable Law.
|
(v)
The books of account of the Company and Series shall be (i) maintained on the basis of a fiscal year that is the calendar year, (ii) maintained on an accrual basis in accordance with Required Accounting Practices, and (iii) unless the Management Committee decides otherwise, audited by the Certified Public Accountants at the end of each calendar year.
|
|
9.02
|
Reports
.
(p)
With respect to each calendar year, the Operator shall prepare and deliver to each Member:
|
(i)
Within 75 Days after the end of such calendar year, a statement of operations and a statement of cash flows for such year, a balance sheet as of the end of such year, and an audited report thereon of the Certified Public Accountants;
provided
that, upon the written request of one or more Members at least [***] Days prior to the applicable calendar year end, which request shall be a standing request effective for subsequent calendar years unless and until revoked by the requesting Member, the Operator shall prepare and deliver to the requesting Member(s) within 25 Days after the end of each such calendar year the foregoing information except for the audited report, which the Operator shall use reasonable efforts to prepare and deliver to the requesting Member(s) no later than 14 Days prior to any regulatory, contractual or filing deadlines of such Member for which the Operator has been notified by such Member.
(ii)
Within 75 Days after the end of such calendar year, such federal, state and local income tax returns and such other accounting and tax information and schedules as shall be necessary for tax reporting purposes by each Member with respect to such year.
(q)
Upon the written request of one or more Founding Members at least [***] Days prior to the applicable calendar year end, the Operator shall use reasonable efforts to prepare and deliver to the requesting Founding Member(s) the following information within [***] Days after the end of such calendar year:
(i)
A discussion and analysis of the results of operations including detailed explanations of significant variances in revenues, expenses and cash flow activities appearing in the audited financial statements, as compared to the same periods in the prior calendar year, and relevant operational statistics, including volumetric data;
(ii)
A schedule of amounts due by year for contractual obligations that will impact Available Cash including notes payable, capital leases, operating leases, and purchase obligations; and
(iii)
A three-year forward-looking forecast that includes a balance sheet, profit and loss statement, and a statement of cash flows. Such forecast shall include information pertaining to the underlying assumptions used in its preparation including volumetric, revenue per-unit and capital expenditure assumptions. Such forecast also shall be updated within 45 Days after execution by the Company of a material Gas Transportation Service Agreement if the timing and amount of revenues or expenses resulting from such agreement are materially different than estimates included in the forward-looking forecast.
The reasonable incremental cost to the Operator of preparing the above reports shall be reimbursed to the Operator by the Founding Member requesting such reports and, in the case of two or more Founding Members requesting such reports, equally by such Founding Members. Such cost shall be determined in accordance with the Accounting Procedure set forth in the COM Agreement.
(r)
Within 25 Days after the end of each calendar month, the Operator shall cause to be prepared and delivered to each Member with an appropriate certification of the Person authorized to prepare the same (
provided
that the Management Committee may change the financial statements required by this Section 9.02(c) to a quarterly basis or may make such other change therein as it may deem appropriate):
(i)
A statement of operations for such month (including sufficient information to permit the Members to calculate their tax accruals) and for the portion of the calendar year then ended as compared with the same periods for the prior calendar year and with the budgeted results for the current periods;
(ii)
A balance sheet
as of the end of such month and the portion of the calendar year then ended; and
(iii)
For quarter month end, a statement of cash flows for the portion of the calendar year then ended as compared to the same period for the prior calendar year.
(s)
In addition to its obligations under subsections (a), (b), and (c) of this Section 9.02, but subject to Section 3.06, the Operator shall timely prepare and deliver to any Member, upon request, all of such additional financial statements, notes thereto and additional financial information as may be required in order for each Member or an Affiliate of such Member to comply with any reporting requirements under (i) the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, (ii) the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, and (iii) any national securities exchange or automated quotation system. The reasonable incremental cost to Operator of preparing and delivering such additional financial statements, notes thereto and additional financial information, including any required incremental audit fees and expenses, shall be reimbursed to the Operator by the Member requesting such reports and, in the case of two or more Members requesting such additional information, equally by such Members. Such cost shall be determined in accordance with the Accounting Procedure set forth in the COM Agreement.
(t)
Operator shall also cause to be prepared and delivered to each Founding Member such other reports, forecasts, studies, budgets and other information as such Founding Member may reasonably request from time to time.
(u)
For purposes of clarification and not limitation, any audit or examination by a Member pursuant to Section 3.6 of the COM Agreement may, at the option of such Member, include audit or examination of the books, records and other support for the costs incurred pursuant to subsections (b) and (e) of this Section 9.02.
|
|
9.03
|
Bank Accounts
. Funds of each Series shall be deposited in such banks or other depositories as shall be designated from time to time by the Management Committee and shall not be commingled with the Operator’s funds. All withdrawals from any such depository shall be made only as authorized by the Management Committee and shall be made only by check, wire transfer, debit memorandum or other written instruction. The Management Committee may authorize the Operator to designate and maintain accounts in any such banks or other depositories in accordance with Exhibit A to the COM Agreement.
|
ARTICLE 10
WITHDRAWAL
|
|
10.01
|
Right of Withdrawal
. With respect to each Series, (a) prior to the In-Service Date of the Facilities assigned to such Series, no Member shall have the right to withdraw from such Series, other than [***] and (b) following the In-Service Date of the Facilities assigned to such Series, each Member shall have the right to withdraw from the Series [***] Days following delivery of written notice to the Management Committee.
|
|
|
10.02
|
Deemed Withdrawal
. A Member is deemed to have Withdrawn from a Series upon the occurrence of any of the following events:
|
|
|
(e)
|
the Member is deemed, pursuant to Section 7.01(d) to have Withdrawn from the Series;
|
|
|
(f)
|
there occurs an event that makes it unlawful for the Member to continue to be a Member;
|
|
|
(g)
|
the Member becomes Bankrupt;
|
|
|
(h)
|
the Member dissolves and commences liquidation or winding-up; or
|
|
|
(i)
|
the Member commits a Default.
|
|
|
10.03
|
Effect of Withdrawal
. A Member that is deemed to have Withdrawn pursuant to Section 10.01 or Section 10.02 (a “
Withdrawn Member
”), must comply with the following requirements in connection with its Withdrawal:
|
(c)
The Withdrawn Member ceases to be a Member of the applicable Series immediately upon the occurrence of the applicable Withdrawal event.
(d)
The Withdrawn Member shall not be entitled to receive any distributions from the Series except as set forth in Section 10.03(e), and neither it nor its Representative shall be entitled to exercise any voting or consent rights, or to appoint any Representative or Alternate Representative to the Management Committee (and the Representative (and the Alternate Representative) appointed by such Member shall be deemed to have resigned) or to receive any further information (or access to information) from the Series. The Sharing Ratio of such Member with respect to any Series shall not be taken into account in calculating the Sharing Ratios of the Members for any purposes. This Section 10.03(b) shall also apply to a Breaching Member; but if a Breaching Member cures its breach during the applicable cure period, then any distributions that were withheld from such Member shall be paid to it, without interest.
(e)
The Withdrawn Member must pay to each Series all amounts owed to it by such Withdrawn Member.
(f)
The Withdrawn Member shall remain obligated for all liabilities it may have under this Agreement or otherwise with respect to the Series that accrue prior to the Withdrawal.
(g)
In the event of a Withdrawal with respect to any Series under Section 10.01 or a deemed Withdrawal under Section 10.02(b) or (c), the Withdrawn Member shall be entitled to receive a portion of each distribution that is made by the Series from and after the In-Service Date for the Facilities assigned to such Series, equal to the product of the Withdrawn Member’s Sharing Ratio with respect to the Series as of the date of its Withdrawal
multiplied by
the aggregate amount of such distribution;
provided
that the Withdrawn Member’s rights under this Section 10.03(e) shall automatically terminate at such time as the Withdrawn Member has received an aggregate amount under this Section 10.03(e) equal to the sum of (i) lesser of (A) the Withdrawn Member’s Outstanding Capital Contribution with respect to the Series, and (B) the Fair Market Value of the Withdrawn Member’s Membership Interest with respect to the Series, each determined as of the date of the Withdrawal,
plus
(ii) any Indebtedness of the Company owed to such Member at the time of Withdrawal. From the date of the Withdrawal to the date of such payment, the amount owing to the Withdrawn Member pursuant to the preceding sentence shall be recorded as a contingent obligation of the Series until such payment is made. The rights of a Withdrawn Member under this Section 10.03(e) shall (A) be subordinate to the rights of any other creditor of the Series, (B) not include any right on the part of the Withdrawn Member to receive any interest or other amounts with respect thereto (except as may otherwise be provided in the evidence of any Indebtedness of the Series owed to such Withdrawn Member); (C) not require the Series to make any distribution (the Withdrawn Member’s rights under this Section 10.03(e) being limiting to receiving a portion of such distributions as the Management Committee may, in its Sole Discretion, decide to cause the Series to make); (D) not require any Member to make a Capital Contribution or a loan to permit the Series to make a distribution or otherwise to pay the Withdrawn Member; and (E) be treated as a liability of the Series for purposes of Section 12.02.
(h)
Except as set forth in Section 10.03(e), a Withdrawn Member shall not be entitled to receive any return of its Capital Contributions or other payment from the Series in respect of its Membership Interest in such Series. Any Performance Assurances or Credit Assurances provided by the Withdrawn Member and outstanding as of the date of Withdrawal shall continue as to the liabilities accrued prior to the date of Withdrawal for which such Performance Assurances were provided under Section 4.01(b) or such Credit Assurances were provided under Section 4.07;
provided
that, in the event a Member is Withdrawn pursuant to Section 10.02(e), such Member shall pay over and forfeit any remaining Performance Assurances as liquidated damages and not as a penalty.
(i)
The Sharing Ratio of the Withdrawn Member with respect to the Series to which the withdrawal relates shall be allocated among the remaining Members with Membership Interests in such Series in the proportion that each Member’s Sharing Ratio with respect to the Series bears to the total Sharing Ratio of all remaining Members with respect to the Series, or in such other proportion as the remaining Members may unanimously agree.
(j)
A deemed Withdrawal under Section 7.01(d) shall carry no connotation or implication that the Withdrawn Member has breached this Agreement or otherwise acted contrary to the intent of this Agreement, it being understood that (i) each Member is completely free to cast its vote as it wishes at the Management Committee meetings described in such Section and (ii) the concept of “deemed Withdrawal” in such Section is merely a convenient technique for permitting the continued development of the Facilities by the Members that desire to continue such development.
ARTICLE 11
DISPUTE RESOLUTION
|
|
11.01
|
Disputes
. This Article 11 shall apply to any dispute arising under or related to this Agreement (whether arising in contract, tort or otherwise, and whether arising at law or in equity), including (a) any dispute regarding the construction, interpretation, performance, validity or enforceability of any provision of this Agreement or whether any Person is in compliance with, or breach of, any provisions of this Agreement; (b) any deadlock among the Representatives on any matter requiring approval of the Management Committee (including any dispute over whether the Representatives of any Founding Member (or its Affiliates) are reasonably withholding their consent in connection with a determination by the Management Committee, but only with respect to those matters specifically identified in Section 6.02(j) and Section 6.05(e)) other than the matters covered by Sections 6.02(i)(G) or 6.02(i)(BB) (a “
Deadlock
”); and (c) the applicability of this Article 11 to a particular dispute. Notwithstanding the foregoing, this Section 11.01 shall not apply to any matters that, pursuant to the provisions of this Agreement, are to be resolved by a vote of the Management Committee;
provided
that, if a vote, approval, consent, determination or other decision must, under the terms of this Agreement, be made (or withheld) in accordance with a standard other than Sole Discretion (such as a reasonableness standard), then the issue of whether such standard has been satisfied may be a dispute to which this Article 11 applies (including Section 11.03); and
provided
,
further
, that any Deadlock shall be resolved solely as provided in Sections 11.02 and 11.05 hereof. Any dispute to which this Article 11 applies is referred to herein as a “
Dispute
.
” With respect to a particular Dispute, each Member that is a party to such Dispute is referred to herein as a “
Disputing Member
.
” The provisions of this Article 11 shall be the exclusive method of resolving Disputes.
|
|
|
11.02
|
Negotiation to Resolve Disputes
. If a Dispute arises, the Disputing Members shall attempt to resolve such Dispute through the following procedure:
|
(k)
first, the designated Representative of each of the Disputing Members shall promptly meet (whether by phone or in person) in a good faith attempt to resolve the Dispute; and
(l)
second, if the Dispute is still unresolved after ten (10) Business Days following the commencement of the negotiations described in Section 11.02(a), then the Parent Decision Makers shall meet in person within five (5) Business Days after the expiration of the aforementioned period of ten (10) Business Days, and such Parent Decision Makers shall attempt in good faith to resolve the Dispute as promptly as practicable.
|
|
11.03
|
Courts
. If a Dispute (other than a Deadlock) is still unresolved following ten (10) Business Days after a written request or demand for negotiations described in Section 11.02(b), then any of such Disputing Members may submit such Dispute only to the Court of Chancery of the State of Delaware or, in the event that such court does not have jurisdiction over the subject matter of such Dispute, to another court of the State of Delaware or a U.S. federal court located in the State of Delaware (collectively, “
Delaware Courts
”), and each of the Members irrevocably submits to the exclusive jurisdiction of the Delaware Courts and hereby consents to service of process in any such Dispute by the delivery of such process to such party at the address and in the manner provided in Section 13.02. Each of the Members hereby irrevocably and unconditionally waives any objection to the laying of venue in any Dispute in the Delaware Courts and hereby further irrevocably and unconditionally waives and agrees not to plead or clam in any such court that any action, suit or proceeding brought in any such court has been brought in an inconvenient forum. EACH MEMBER IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.
|
|
|
11.04
|
Specific Performance
. The Members understand and agree that (a) irreparable damage would occur in the event that any provision of this Agreement were not performed in accordance with its specific terms, (b) although monetary damages may be available for the breach of such covenants and agreements such monetary damages are not intended to and do not adequately compensate for the harm that would result from a breach of this Agreement, would be an inadequate remedy therefor and shall not be construed to diminish or otherwise impair in any respect any Member’s or the Company’s right to specific performance and (c) the right of specific performance is an integral part of the transactions contemplated by this Agreement and without that right none of the Members would have entered into this Agreement. It is accordingly agreed that, in addition to any other remedy that may be available to it, including monetary damages, each of the Members and the Company shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement. Each of the Members further agrees that no Member nor the Company shall be required to obtain, furnish or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this Section 11.04 and each Member waives any objection to the imposition of such relief or any right it may have to require the obtaining, furnishing or posting of any such bond or similar instrument.
|
(a)
If a Deadlock is still unresolved pursuant to the procedures set forth in Section 11.02, then the Deadlock shall be settled by arbitration conducted in the English language in New York, New York, administered by and in accordance with the terms of this Agreement and the Commercial Arbitration Rules (“
Rules
”) of the American Arbitration Association (“
AAA
”) (the “
Arbitration
”).
(b)
Any Disputing Member (the “
Arbitration Invoking Party
”) may, by notice (the “
Arbitration Notice
”) to any other Disputing Member (the “
Arbitration Noticed Party
”), submit the Dispute to Arbitration in accordance with the provisions of this Section 11.05(b). Any Disputing Member may initiate Arbitration by filing with the AAA a notice of intent to arbitrate within the mediation period.
(c)
Any such Arbitration proceeding shall be before a tribunal of three (3) arbitrators, one (1) designated by the Arbitration Invoking Party, one (1) designated by the Arbitration Noticed Party, and one (1) designated by the two (2) arbitrators so designated. The Arbitration Invoking Party and the Arbitration Noticed Party shall each name their arbitrator by notice (the “
Selection Notice
”) given within five (5) Business Days after the date of the Arbitration Notice, and the two (2) arbitrators so appointed shall agree upon the third member of the tribunal within five (5) Business Days after the date of the Selection Notice. Any member of the tribunal not appointed within the period required, whether by one of the Disputing Members or by the two (2) arbitrators chosen by the Disputing Members, shall be appointed by the AAA. The arbitrators shall have no affiliation with, financial or other interest in, or prior employment with either Disputing Member or their Affiliates and shall be experienced and well-regarded oil and gas attorneys knowledgeable in the field of the dispute.
(d)
In any Arbitration in which the Deadlock involves a dispute over whether the Representatives of any Founding Members are reasonably withholding their consent in connection with a determination by the Management Committee with respect to any matter identified in Section 6.02(j) or Section 6.05(e), the arbitrators shall first determine whether the Representatives of such Founding Member are reasonably withholding their consent in the matter(s) in question and, if such Representatives are determined to have acted reasonably, the arbitrators shall then immediately proceed to resolve the Deadlock among the Representatives on the matter(s) requiring approval of the Management Committee.
(e)
Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall have twenty (20) Business Days, commencing on the date the Arbitration Notice is given, to prepare and submit a proposal for the resolution of the dispute to the tribunal, including a description of how such Disputing Member arrived at its proposal and the arguments therefor, as it deems appropriate. Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall deliver a copy of its proposal, including any such supplemental information, to the other Disputing Member at the same time it delivers the proposal to the tribunal.
(f)
Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall have five (5) Business Days after the receipt of the other Disputing Member’s proposal to revise its respective proposal and submit a final proposal to the tribunal, including supporting arguments for its own and against the other Disputing Member’s proposal.
(g)
Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall present oral arguments supporting its final proposal to the tribunal at a proceeding held five (5) Business Days after the deadline for submission of final proposals to the tribunal. Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall have three (3) hours to make its oral presentation to the tribunal.
(h)
The tribunal shall, within ten (10) Business Days after presentation of the oral arguments, render a decision that selects the Arbitration Invoking Party’s final proposal (with no modifications thereto) or the Arbitration Noticed Party’s final proposal (with no modifications thereto), and no other proposal. The award rendered pursuant to the foregoing shall be final and binding on the Disputing Members, shall not be subject to appeal, and judgment thereon may be entered or enforcement thereof sought by either Disputing Member in any court of competent jurisdiction.
(i)
Each Disputing Member shall bear the costs of its appointed arbitrator and its own attorneys’ fees, and the costs of the third arbitrator incurred in accordance with the foregoing shall be shared equally by the Disputing Members. Additional incidental costs of the Arbitration shall be paid for by the non-prevailing Disputing Member in the Arbitration.
(j)
Notwithstanding the foregoing, each Disputing Member may at any time in a Dispute apply to the Court of Chancery for a decree of dissolution of the Company pursuant to Section 18-802 of the Act.
ARTICLE 12
DISSOLUTION, WINDING-UP AND TERMINATION
(m)
The Company shall dissolve and its affairs shall be wound up (i) on the date all Series of the Company are terminated and wound up or (ii) upon entry of a decree of judicial dissolution under Section 18-802 of the Act.
(n)
A Series shall dissolve and its affairs shall be wound up on the first to occur of the following events (each a “
Dissolution Event
”):
(iii)
decision to terminate the Series by Supermajority Interest;
(iv)
entry of a decree of judicial dissolution of the Series under Section 18-215(m) of the Act;
(v)
the Disposition or abandonment of all or substantially all of the Series’ business and assets;
(vi)
an event that makes it unlawful for the business of the Series to be carried on;
(vii)
with respect to Series A, by 10 Business Days’ written notice of termination given by USG or EQT if the initial Construction Budget, the Project Schedule and the Initial Operating Budget have not been approved by USG and EQT by the [***] Day following the delivery thereof to USG;
provided
,
however
, that, if the initial Construction Budget, Project Schedule and the Initial Operating Budget are approved within 10 Business Days following delivery of such notice of termination, then such written notice of termination shall be null and void, and this Agreement shall continue in full force and effect.
(o)
The termination and winding up of a Series shall not, in it of itself, cause a dissolution of the Company or the termination of any other Series;
provided
,
however
, that the Company shall dissolve and its affairs shall be wound up on the date all Series of the Company are terminated and wound up. The termination of a single Series shall not affect the limitation on liabilities of such Series or any other Series provided by this Agreement and the Act.
|
|
12.02
|
Winding-Up and Termination
.
(a)
On the termination of a Series, the Management Committee shall designate a Member or other Person to serve as liquidator. The liquidator shall proceed diligently to wind up the affairs of the Series and make final distributions as provided herein and in the Act. The costs of winding-up shall be borne as a Series expense. Until final distribution, the liquidator shall continue to operate the Series properties with all of the power and authority of the Members. The steps to be accomplished by the liquidator are as follows:
|
(i)
as promptly as possible after termination and again after final winding-up, the liquidator shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Series’ assets, liabilities, and operations through the last Day of the month in which the termination occurs or the final winding-up is completed, as applicable;
(ii)
the liquidator shall discharge from Series funds all of the Indebtedness of the Series and other debts, liabilities and obligations of the Series (including all expenses incurred in winding-up and any loans described in Section 4.02) or otherwise make adequate provision for payment and discharge thereof (including the establishment of a cash escrow fund for contingent liabilities in such amount and for such term as the liquidator may reasonably determine); and
(iii)
all remaining assets of the Series shall be distributed to the Members as follows:
(A)
the liquidator may sell any or all Series property, including to Members, and any resulting gain or loss from each sale shall be computed and allocated to the Capital Accounts of the Members with respect to the Series in accordance with the provisions of Article 5;
(B)
with respect to all Series property that has not been sold, the fair market value of that property shall be determined and the Capital Accounts of the Members with respect to the Series shall be adjusted to reflect the manner in which the unrealized income, gain, loss, and deduction inherent in property that has not been reflected in the Capital Accounts with respect to the Series previously would be allocated among the Members if there were a taxable disposition of that property for the fair market value of that property on the date of distribution; and
(C)
Series property (including cash) shall be distributed among the Members in accordance with Section 5.01; and those distributions shall be made by the end of the taxable year of the Series during which the liquidation of the Series occurs (or, if later, [***] Days after the date of the liquidation).
(b)
The distribution of cash or property to a Member with respect to a Series in accordance with the provisions of this Section 12.02 constitutes a complete return to the Member of its Capital Contributions with respect to the Series and a complete distribution to the Member of its Membership Interest with respect to the Series and all the Series property and constitutes a compromise to which all Members have consented pursuant to Section 18-502(b) of the Act. To the extent that a Member returns funds to the Company or any Series, it has no claim against any other Member for those funds. Except as otherwise provided by applicable laws, upon termination of a Series, each Member associated with such Series shall look solely to the assets of such Series for the return of its Capital Contributions made with respect to such Series, and if the assets of such Series remaining after payment of or due provision for the debts and liabilities of the Company with respect to such Series are insufficient to return such Capital Contributions, such Members shall have no recourse against any other Series, the Company or any other Member, except as otherwise provided by law.
(c)
No dissolution or termination of the Company shall relieve a Member from any obligation to the extent such obligation has accrued as of the date of such dissolution or termination. Upon such termination, any books and records of the Company that there is a reasonable basis for believing will ever be needed again shall be furnished to the Operator, who shall keep such books and records (subject to review by any Person that was a Member at the time of dissolution) for a period at least three (3) years. At such time as the Operator no longer agrees to keep such books and records, it shall offer the Persons who were Members at the time of dissolution the opportunity to take over such custody, shall deliver such books and records to such Persons if they elect to take over such custody, and may destroy such books and records if they do not so elect. Any such custody by such Persons shall be on such terms as they may agree upon among themselves.
|
|
12.03
|
Deficit Capital Accounts
. No Member will be required to pay to the Company, to any other Member or to any third party any deficit balance that may exist from time to time in any Member’s Capital Account with respect to any Series.
|
|
|
12.04
|
Certificate of Cancellation
. On completion of the distribution of the Company’s assets as provided herein, the Members (or such other Person or Persons as the Act may require or permit) shall file a certificate of cancellation with the Secretary of State of Delaware, cancel any other filings made pursuant to the Act, and take such other actions as may be necessary to terminate the existence of the Company. Upon the filing of such certificate of cancellation, the existence of the Company shall terminate (and the Term shall end), except as may be otherwise provided by the Act or other applicable Law.
|
ARTICLE 13
GENERAL PROVISIONS
|
|
13.01
|
Offset; Costs and Expenses
.
(d)
Whenever a Series is to pay any sum to any Member, any amounts that Member owes the Series may be deducted from that sum before payment.
|
(e)
Series A shall reimburse the Founding Members for all out-of-pocket costs and expenses incurred by the Founding Members prior to the Effective Date in connection with the drafting, review and negotiation of this Agreement and the COM Agreement and for any out-of-pocket costs or expenses incurred by a Member in connection with the formation of the Company.
|
|
13.02
|
Notices
. Except as expressly set forth to the contrary in this Agreement, all notices, requests or consents provided for or permitted to be given under this Agreement must be in writing and must be delivered to the recipient in person, by courier or mail, or by facsimile or other electronic transmission, including electronic mail. A notice, request or consent given under this Agreement is effective on receipt by the Member to receive it;
provided
that a facsimile or other electronic transmission that is transmitted after the normal business hours of the recipient shall be deemed effective on the next Business Day. All notices, requests and consents to be sent to a Member must be sent to or made at the addresses given for that Member on
Exhibit A
or in the instrument described in Section 3.03(b)(iv)(A)(2) or Section 3.04, or such other address as that Member may specify by notice to the other Members. Any notice, request or consent to the Company must be given to all of the Members. Whenever any notice is required to be given by Law, the Delaware Certificate or this Agreement, a written waiver thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.
|
|
|
13.03
|
Entire Agreement; Superseding Effect
. This Agreement, the COM Agreement, and [***] constitute the entire agreement of the Members and their Affiliates relating to the Company and the transactions contemplated hereby and supersede all provisions and concepts contained in all prior agreements.
|
|
|
13.04
|
Effect of Waiver or Consent
. Except as otherwise provided in this Agreement, a waiver or consent, express or implied, to or of any breach or default by any Member in the performance by that Member of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that Member of the same or any other obligations of that Member with respect to the Company. Except as otherwise provided in this Agreement, failure on the part of a Member to complain of any act of any Member or to declare any Member in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that Member of its rights with respect to that default until the applicable statute-of-limitations period has run.
|
|
|
13.05
|
Amendment or Restatement
. This Agreement and the Delaware Certificate may be amended or restated only by a written instrument executed (or, in the case of the Delaware Certificate, approved) by Supermajority Interest;
provided
,
however
, that any amendment or restatement that is materially adverse to any Member in a manner that is disproportionate to such Member’s interest (as compared to the interest of other Members) shall (a) if the affected Member is a Founding Member, require the written consent or approval of such Founding Member; or (b) if the affected Member is not a Founding Member, require the written consent or approval of a majority of all Members similarly adversely affected.
|
|
|
13.06
|
Binding Effect
. Subject to the restrictions on Dispositions set forth in this Agreement, this Agreement is binding on and shall inure to the benefit of the Members and their respective successors and permitted assigns.
|
|
|
13.07
|
Governing Law; Severability
. THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT MIGHT REFER THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAW OF ANOTHER JURISDICTION. In the event of a direct conflict between the provisions of this Agreement and any mandatory, non-waivable provision of the Act, such provision of the Act shall control. If any provision of the Act provides that it may be varied or superseded in a limited liability company agreement (or otherwise by agreement of the members or managers of a limited liability company), such provision shall be deemed superseded and waived in its entirety if this Agreement contains a provision addressing the same issue or subject matter. If any provision of this Agreement or the application thereof to any Member or circumstance is held invalid or unenforceable to any extent, (a) the remainder of this Agreement and the application of that provision to other Members or circumstances is not affected thereby, and (b) the Members shall negotiate in good faith to replace that provision with a new provision that is valid and enforceable and that puts the Members in substantially the same economic, business and legal position as they would have been in if the original provision had been valid and enforceable.
|
|
|
13.08
|
Further Assurances
. In connection with this Agreement and the transactions contemplated hereby, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Agreement and those transactions;
provided
,
however
, that this Section 13.08 shall not obligate a Member to furnish guarantees or other credit supports by such Member’s Parent or other Affiliates.
|
|
|
13.09
|
Waiver of Certain Rights
. Each Member irrevocably waives any right it may have to maintain any action for dissolution of the Company or for partition of the property of the Company.
|
|
|
13.10
|
Counterparts
. This Agreement may be executed in any number of counterparts with the same effect as if all signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument.
|
|
|
13.11
|
Fair Market Value Determination
.
|
(a)
[***]
(b)
[***]
(c)
[***]
|
|
13.12
|
Other Agreements
. Notwithstanding any other provision of this Agreement, it is hereby acknowledged and agreed that the Company has the power and authority, without further act, approval, or vote of the Management Committee, to [***].
|
[Remainder of page intentionally left blank. Signature page follows.]
IN WITNESS WHEREOF, the Members have executed this Agreement as of the date first set forth above.
MEMBERS
:
MVP HOLDCO, LLC
By:
/s/ Randall L. Crawford
Name:
Randall L. Crawford
Title:
President
US MARCELLUS GAS INFRASTRUCTURE, LLC
By:
/s/ Lawrence A. Wall, Jr.
Name:
Lawrence A. Wall, Jr.
Title:
President
COMPANY
:
MOUNTAIN VALLEY PIPELINE, LLC
By: MVP Holdco, LLC, its Member
By:
/s/ Randall L. Crawford
Name:
Randall L. Crawford
Title:
President
|
|
By:
|
US Marcellus Gas Infrastructure, LLC,
|
its Member
By:
/s/ Lawrence A. Wall, Jr.
Name:
Lawrence A. Wall, Jr.
Title:
President
EXHIBIT A
MEMBERS
|
|
|
|
|
Name, Address, Fax and E-mail
|
Series A Sharing
Ratio
|
Parent
|
Representative and Alternate Representatives
|
MVP HOLDCO, LLC
EQT Plaza
625 Liberty Avenue
Pittsburgh, Pennsylvania 15222
Fax: (412) 553-7781
Attention: Blue Jenkins
[***]
David Gray
[***]
Sean McGinty
[***]
|
[***]%
|
[***]
|
[***]
[***]
|
US MARCELLUS GAS INFRASTRUCTURE, LLC
601 Travis Street
Suite 1900
Houston, Texas 77002
Fax: 713.751.0375
Attention: Lawrence A. Wall, Jr.
[***]
Karina Amelang
[***]
|
[***]%
|
[***]
|
[***]
[***]
|
EXHIBIT B
FORM OF LIMITED LIABILITY COMPANY AGREEMENT
LIMITED LIABILITY COMPANY AGREEMENT
OF
[●], LLC
A Delaware Limited Liability Company
[●], 2014
TABLE OF CONTENTS
Article 1 DEFINITIONS
1
Article 2 ORGANIZATION
16
|
|
2.03
|
Registered Office; Registered Agent; Principal Office in the
|
United States; Other Offices 16
|
|
2.05
|
No State Law Partnership 17
|
|
|
2.06
|
Foreign Qualification 17
|
|
|
2.08
|
Title to Property 17
|
Article 3 MEMBERSHIP INTERESTS; DISPOSITIONS OF INTERESTS
17
|
|
3.01
|
Capital Structure 17
|
|
|
3.02
|
Representations, Warranties and Covenants. 18
|
|
|
3.03
|
Dispositions and Encumbrances of Membership Interests. 19
|
|
|
3.04
|
Creation of Additional Membership Interests 29
|
|
|
3.05
|
Access to Information 29
|
|
|
3.06
|
Confidential Information 30
|
|
|
3.07
|
Liability to Third Parties 32
|
|
|
3.08
|
Use of Members’ Names and Trademarks 32
|
Article 4 CAPITAL CONTRIBUTIONS/LOANS
32
|
|
4.01
|
Capital Contributions 32
|
|
|
4.03
|
No Other Contribution or Loan Obligations 36
|
|
|
4.04
|
Return of Contributions 37
|
|
|
4.06
|
Failure to Make a Capital Contribution or Loan. 38
|
|
|
4.07
|
Credit Assurance. 41
|
Article 5 DISTRIBUTIONS AND ALLOCATIONS
41
|
|
5.02
|
[Intentionally omitted.] 42
|
|
|
5.03
|
[Intentionally omitted.] 42
|
|
|
5.04
|
Allocations for Maintaining Capital Accounts 42
|
|
|
5.05
|
Allocations for Tax Purposes 43
|
|
|
5.06
|
Varying Interests 44
|
i
746278.04-WILSR01A - MSW
Article 6 MANAGEMENT
45
|
|
6.02
|
Management Committee 45
|
|
|
6.03
|
Construction, Operation and Management Agreement 52
|
|
|
6.04
|
No Duties; Disclaimer of Duties 52
|
|
|
6.05
|
Business Opportunities. 53
|
|
|
6.06
|
Insurance Coverage. 54
|
|
|
6.08
|
Limitation on Liability 56
|
|
|
6.09
|
Delivery of Operating Budget 56
|
Article 7 DEVELOPMENT OF FACILITIES
57
|
|
7.01
|
Development of Facilities. 57
|
|
|
7.03
|
General Regulatory Matters. 58
|
Article 8 TAXES
58
|
|
8.03
|
Tax Matters Member 59
|
Article 9 BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
60
|
|
9.01
|
Maintenance of Books 60
|
Article 10 WITHDRAWAL
63
|
|
10.01
|
Right of Withdrawal 63
|
|
|
10.02
|
Deemed Withdrawal 63
|
|
|
10.03
|
Effect of Withdrawal 63
|
Article 11 DISPUTE RESOLUTION
65
|
|
11.02
|
Negotiation to Resolve Disputes 65
|
|
|
11.04
|
Specific Performance 66
|
Article 12 DISSOLUTION, WINDING-UP AND TERMINATION
68
|
|
12.02
|
Winding-Up and Termination 68
|
|
|
12.03
|
Deficit Capital Accounts 70
|
|
|
12.04
|
Certificate of Cancellation 70
|
ii
746278.04-WILSR01A - MSW
Article 13 GENERAL PROVISIONS
70
|
|
13.01
|
Offset; Costs and Expenses 70
|
|
|
13.03
|
Entire Agreement; Superseding Effect 70
|
|
|
13.04
|
Effect of Waiver or Consent 70
|
|
|
13.05
|
Amendment or Restatement 71
|
|
|
13.07
|
Governing Law; Severability 71
|
|
|
13.08
|
Further Assurances 71
|
|
|
13.09
|
Waiver of Certain Rights 72
|
|
|
13.11
|
Fair Market Value Determination. 72
|
EXHIBIT
:
A - Members
iii
746278.04-WILSR01A - MSW
LIMITED LIABILITY COMPANY AGREEMENT
OF
[●], LLC
This LIMITED LIABILITY COMPANY AGREEMENT OF [●], LLC (this “
Agreement
”), dated as of [●], 2014 (the “
Effective Date
”), is adopted, executed and agreed to by [EQT Entity], LLC, a Delaware limited liability company (“
EQT
”), [USG Entity], LLC, a Delaware limited liability company (“
USG
”), and [●], LLC, a Delaware limited liability company (the “
Company
”) and each Person from time to time admitted to the Company as a Member in accordance with the terms hereof.
RECITALS
WHEREAS, on [●], 20[●], the Company was formed as a limited liability company in accordance with the Act (as hereinafter defined) for the purpose of developing, constructing, owning, and operating the Facilities (as defined herein) [and [●]]; and
WHEREAS, the Members (as hereinafter defined) desire to make certain provisions regarding the affairs of the Company and the conduct of its business and the rights and obligations of the Members on the terms and subject to the conditions set forth herein.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Members agree as follows:
Article 1
DEFINITIONS
|
|
1.03
|
Definitions
. As used in this Agreement, the following terms have the respective meanings set forth below or set forth in the Sections referred to below:
|
708(b) Members
– has the meaning set forth in Section 3.03(b)(viii).
AAA
– has the meaning set forth in Section 11.05(a).
Act
– means the Delaware Limited Liability Company Act.
Additional Contribution/Loan
– has the meaning set forth in Section 4.06(a)(ii).
Additional Contribution/Loan Members
– has the meaning set forth in Section 4.06(a)(ii).
Adjusted Capital Account
– means the Capital Account maintained for each Member as provided in Section 4.05, (a) increased by (i) an amount equal to such Member’s allocable share of Minimum Gain as computed in accordance with the applicable Treasury Regulations, and (ii) the amount that such Member is deemed to be obligated to restore pursuant to Treasury Regulations Section 1.704-1(b)(2)(ii)(c), if any, and (b) reduced by the adjustments provided for in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4)-(6). The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
Affiliate
– means, (i) with respect to any Person, (a) each entity that such Person Controls; (b) each Person that Controls such Person, including, in the case of a Member, such Member’s Parent; and (c) each entity that is under common Control with such Person, including, in the case of a Member, each entity that is Controlled by such Member’s Parent;
provided
that, with respect to any Member, an Affiliate shall include (y) a limited partnership or a Person Controlled by a limited partnership if such Member’s Parent has the power to appoint the general partner of such limited partnership, or such general partner is otherwise is Controlled by such Member’s Parent, or (z) a limited liability company or a Person controlled by a limited liability company if such Member’s Parent has the power to appoint the managing member or manager (or, if more than one manager, a majority of managers) of the limited liability company, or such managing member or manager(s) are Controlled by such Member’s Parent;
provided
,
further
, that, for purposes of this Agreement, the Company shall not be an Affiliate of any Member; and (ii) [***].
Affiliate’s Outside Activities
– has the meaning set forth in Section 6.05(a).
Agreement
– has the meaning set forth in the Preamble.
Alternate Representative
– has the meaning set forth in Section 6.02(a)(i).
Appraiser
– has the meaning set forth in Section 13.11(c).
Approved Precedent Agreement
– means each Precedent Agreement approved by the Management Committee pursuant to Section 6.02(i)(S).
Arbitration
– has the meaning set forth in Section 11.05(a).
Arbitration Invoking Party
– has the meaning set forth in Section 11.05(b).
Arbitration Notice
– has the meaning set forth in Section 11.05(b).
Arbitration Noticed Party
– has the meaning set forth in Section 11.05(b).
Assignee
– means any Person that acquires a Membership Interest or any portion thereof through a Disposition;
provided
that an Assignee shall have no right to be admitted to the Company as a Member except in accordance with Section 3.03(b)(iii). Subject to the Preferential Rights set forth in Section 3.03(b)(ii), the Assignee of a dissolved Member is the shareholder, partner, member or other equity owner or owners of the dissolved Member to whom such Member’s Membership Interest is assigned by the Person conducting the liquidation or winding-up of such Member. The Assignee of a Bankrupt Member is (a) the Person or Persons (if any) to whom such Bankrupt Member’s Membership Interest is assigned by order of the bankruptcy court or other Governmental Authority having jurisdiction over such Bankruptcy, or (b) in the event of a general assignment for the benefit of creditors, the creditor to which such Membership Interest is assigned.
Assumed Tax Rate
– means, for any period, the effective maximum combined marginal U.S. federal, state, and local income tax rate applicable to ordinary income of an individual resident of New York, New York, after giving effect to any U.S. federal income tax deduction for state and local income taxes.
Authorizations
– means licenses, certificates, permits, orders, approvals, determinations and authorizations from Governmental Authorities having valid jurisdiction.
Available Cash
– means, with respect to any Quarter ending prior to the dissolution or liquidation of the Company, and without duplication:
(a) the sum of all cash and cash equivalents of the Company on hand at the end of such Quarter, less
(b) the amount of any cash reserves that is necessary or appropriate in the reasonable discretion of the Management Committee (i) to provide for the proper conduct of the business of the Company (including reserves for future maintenance capital expenditures and for anticipated future credit needs of the Company) subsequent to such Quarter or (ii) to comply with applicable law or any loan agreement, security agreement, mortgage, debt instrument or other agreement or obligation to which the Company is a party or by which it is bound or its assets are subject.
Notwithstanding the foregoing, “Available Cash” with respect to the Quarter in which a liquidation or dissolution of the Company occurs and any subsequent Quarter shall be deemed to equal zero.
Bankruptcy
or
Bankrupt
– means, with respect to any Person, that (a) such Person (i) makes a general assignment for the benefit of creditors; (ii) files a voluntary bankruptcy petition; (iii) becomes the subject of an order for relief or is declared insolvent in any federal or state bankruptcy or insolvency proceedings; (iv) files a petition or answer seeking for such Person a reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any Law; (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against such Person in a proceeding of the type described in subclauses (i) through (iv) of this clause (a); or (vi) seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator of such Person or of all or any substantial part of such Person’s properties; or (b) against such Person, a proceeding seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any Law has been commenced and 120 Days have expired without dismissal thereof or with respect to which, without such Person’s consent or acquiescence, a trustee, receiver, or liquidator of such Person or of all or any substantial part of such Person’s properties has been appointed and 90 Days have expired without the appointment’s having been vacated or stayed, or 90 Days have expired after the date of expiration of a stay, if the appointment has not previously been vacated.
Breaching Member
– means a Member that, as of any date, (a) has committed a failure or breach of the type described in the definition of “Default,” (b) has received a written notice with respect to such failure or breach of the type described in such definition of “Default,” and (c) has not cured such failure or breach as of such date, but as to which the applicable cure period set forth in such definition of “Default” has not then expired.
Business Day
– means any day other than a Saturday, a Sunday, or a holiday on which national banking associations in the State of Delaware are closed.
[***]
Capital Account
– means the account maintained by the Company for each Member in accordance with Section 4.05.
Capital Budget
– means (a) the Construction Budget, (b) the capital budget associated with the Facilities covered by any Approved Precedent Agreement, and (c) the annual capital budget for the Company that is approved (or deemed approved) pursuant to Section 6.02(i)(GG). Each Capital Budget shall cover all items that are classified as capital items under Required Accounting Practices.
Capital Call
– has the meaning set forth in Section 4.01(a)(iv).
Capital Contribution
– means, with respect to a Member, the amount of money and the net agreed fair market value of any property (other than money) contributed to the Company by the Member. Any reference in this Agreement to the Capital Contribution of a Member shall include a Capital Contribution of its predecessors in interest.
Certified Public Accountants
– means a firm of independent public accountants selected from time to time by the Management Committee.
Change of Control
– means:
(a) with respect to any Member, an event (such as a Disposition of voting securities or other equity interests or substantially all the assets of such Member) that causes such Member to cease to be Controlled by such Member’s then Parent;
provided
that the term “Change of Control” shall not include any of the following events:
(A) with respect to a Founding Member, an event that causes such Member’s then Parent to be Controlled by another Person;
(B) a Disposition of the Membership Interests held by, or the equity or assets of, such Member to an Affiliate of such Member or such Member’s then Parent, or any other event, including any corporate reorganization, merger, combination or similar transaction, that results in such Member being Controlled by an Affiliate of such Member’s then Parent, including, in each case, a Disposition to a limited partnership whose general partner is Controlled by an Affiliate of such Member or its then Parent;
(C) in the case of a Member that is a publicly traded partnership or is Controlled by a publicly traded partnership, any Disposition of units or issuance of new units representing limited partner interests by such publicly traded partnership, whether to an Affiliate or an unrelated party and whether or not such units or interests are listed on a national securities exchange or quotation service so long as the general partner of such publicly traded partnership is Controlled by an Affiliate of such Member or its Parent; and
(D) [***];
(b) prior to and following the In-Service Date, with respect to the Operator, an event (such as a Disposition of voting securities or other equity interests of substantially all the assets of the Operator) that causes, directly or indirectly, the Operator to be Controlled by another Person, subject to Section 3.03(b)(vi)(D). With respect to the Operator, “Change of Control” shall not include an event (i) that causes the Operator to be Controlled by an Affiliate of the Operator or an Affiliate of the Operator’s then Parent or (ii) that causes the Parent of the Operator to be Controlled by another Person so long as [***]; and
(c) Notwithstanding the foregoing, and for the avoidance of doubt, any event that (i) constitutes a Change of Control under clause (a) of this definition of Change of Control or (ii) is expressly excluded from this definition of Change of Control pursuant to clauses (a)(A), (a)(B), (a)(C) or (a)(D) above shall not be deemed a Disposition for purposes of Section 3.03 of this Agreement, other than for purposes of Section 3.03(b)(iv);
provided
,
however
, that Dispositions or issuances described in clause (a)(C) shall not be deemed a Disposition for purposes of Section 3.03(b)(iv).
Change Exercise Notice
– has the meaning set forth in Section 3.03(b)(vi)(A).
Change Purchasing Member
– has the meaning set forth in Section 3.03(b)(vi)(A).
Change Unexercised Portion
– has the meaning set forth in Section 3.03(b)(vi)(A).
Changing Member
– has the meaning set forth in Section 3.03(b)(vi)(A).
Claim
– means any and all judgments, claims, causes of action, demands, lawsuits, suits, proceedings, Governmental investigations or audits, losses, assessments, fines, penalties, administrative orders, obligations, costs, expenses, liabilities and damages (whether actual, consequential or punitive), including interest, penalties, reasonable attorney’s fees, disbursements and costs of investigations, deficiencies, levies, duties, imposts, remediation and cleanup costs, and natural resources damages.
Code
– means the Internal Revenue Code of 1986, as amended.
COM Agreement
– has the meaning set forth in Section 6.03.
COM Approval Matters
– means all matters requiring the approval of the Company or providing for the exercise of rights by the Company, including, without limitation, those set forth in Sections 3.1, 3.2, 3.4, 3.5, 3.6, 4.2, 4.4, 5.1, 5.2, 7.1(b), 7.2, 8.2, and 8.3, Article 9, Sections 13.2 and 13.4, Article 15, Article 17, Section 18.6 and 18.9, Exhibit A, and Exhibit B of the COM Agreement.
Comment Deadline
– has the meaning set forth in Section 6.09.
Company
– has the meaning set forth in the Preamble.
Confidential Information
– means all information and data (including all copies thereof) that is furnished or submitted by any of the Members, their Affiliates, or Operator, whether oral, written, or electronic, to the other Members, their Affiliates, or Operator in connection with the Facilities and the resulting information and data obtained from those studies, including market evaluations, market proposals, service designs and pricing, pipeline system design and routing, cost estimating, rate studies, identification of permits, strategic plans, legal documents, environmental studies and requirements, public and governmental relations planning, identification of regulatory issues and development of related strategies, legal analysis and documentation, financial planning, gas reserves and deliverability data, studies of the natural gas supplies for the Facilities, and other studies and activities to determine the potential viability of the Facilities and their design characteristics, and identification of key issues. Notwithstanding the foregoing, the term “Confidential Information” shall not include any information that:
(a) is in the public domain at the time of its disclosure or thereafter, other than as a result of a disclosure directly or indirectly by a Member or its Affiliates in contravention of this Agreement;
(b) as to any Member or its Affiliates, was in the possession of such Member or its Affiliates prior to the execution of this Agreement and not subject to a separate confidentiality restriction;
(c) has been independently acquired or developed by a Member or its Affiliates without violating any of the obligations of such Member or its Affiliates under this Agreement; or
(d) is received from a third-party source on a non-confidential basis, provided that such third-party source is not subject to an obligation of confidentiality and would not reasonably have been expected to know that the information was to be kept confidential from the applicable party.
Construction Budget
– has the meaning set forth in Section 4.01(a)(i).
Contributing/Loan Member
– has the meaning set forth in Section 4.06(a).
Control, Controls or Controlled
– means the possession, directly or indirectly, through one or more intermediaries, of the following:
(a) (i) in the case of a corporation, 50% or more of the outstanding voting securities thereof; (ii) in the case of a limited liability company, general partnership or venture, the right to 50% or more of the distributions therefrom (including liquidating distributions); (iii) in the case of a trust or estate, including a statutory trust, 50% or more of the beneficial interest therein; (iv) in the case of a limited partnership (A) the right to 50% or more of the distributions therefrom (including liquidating distributions), (B) where the general partner of such limited partnership is a corporation, ownership of 50% or more of the outstanding voting securities of such corporate general partner, (C) where the general partner of such limited partnership is a partnership, limited liability company or other entity (other than a corporation or limited partnership), the right to 50% or more of the distributions (including liquidating distributions) from such general partner entity, or (D) where the general partner of such limited partnership is a limited partnership, Control of the general partner of such general partner in the manner described under subclause (B) or (C) of this clause, or (v) in the case of any other entity, 50% or more of the economic or beneficial interest therein; or
(b) in the case of any entity, the power or authority, through ownership of voting securities, by contract or otherwise, to exercise predominant control over the management of the entity.
Control Notice
– has the meaning set forth in Section 3.03(b)(vi)(A).
Covered Person
– has the meaning set forth in Section 6.07(a).
Credit Assurance
– has the meaning set forth in Section 4.07(a).
Day
– means a calendar day,
provided
that if any period of Days referred to in this Agreement shall end on a Day that is not a Business Day, then the expiration of such period shall be automatically extended until the end of the next occurring Business Day.
Deadlock
– has the meaning set forth in Section 11.01.
December Deadline
– has the meaning set forth in Section 6.09.
Deemed Membership Disposition
– means, with respect to any Membership Interest that is owned by a Person, the primary assets of which comprise such Membership Interest and assets that are directly related thereto, a Disposition of all of the voting securities or other equity interests of such Person.
Default
– means, with respect to any Member:
(a) the failure of such Member to contribute, within [***] Days of the date required pursuant to Section 4.06, all or any portion of a Capital Contribution that such Member is required to make as provided in this Agreement; or
(b) the failure of a Member to comply in any material respect with any of its other agreements, covenants or obligations under this Agreement, or the failure of any representation or warranty made by a Member in this Agreement to have been true and correct in all material respects at the time it was made;
in the case of each of clause (a) and (b) above if such breach is not cured by the applicable Member within [***] Days of its receiving written notice of such breach from any other Member (or, if a breach of clause (b) is not capable of being cured within such [***]-Day period, if such Member fails to promptly commence substantial efforts to cure such breach or to prosecute such curative efforts to completion with continuity and diligence). The Management Committee may, but shall have no obligation to, extend the foregoing [***]-Day and [***]-Day periods, as determined in its Sole Discretion.
Default Rate
– means a rate per annum equal to the lesser of (a) a varying rate per annum equal to the sum of (i) the prime rate as published in
The Wall Street Journal
, with adjustments in that varying rate to be made on the same date as any change in that rate is so published,
plus
(ii) [***]% per annum, and (b) the maximum rate permitted by Law.
Delaware Certificate
– means the Certificate of Formation of the Company that was filed with the Office of the Secretary of State of Delaware on [__________], 2014.
Delaware Courts
– has the meaning set forth in Section 11.03.
Demand Event
– has the meaning set forth in Section 4.07(b).
Dispose
,
Disposing
, or
Disposition
– means, with respect to any asset (including a Membership Interest or any portion thereof), a sale, assignment, transfer, conveyance, gift, exchange or other disposition of such asset, whether such disposition be voluntary, involuntary or by operation of Law (and, with respect to a Membership Interest, any derivative or similar arrangement whereby a portion or all of the economic interests in, or risk of loss or opportunity for gain with respect to, such Membership Interest is transferred or shifted to another Person), including the following: (a) in the case of an asset owned by a natural person, a transfer of such asset upon the death of its owner, whether by will, intestate succession or otherwise; (b) in the case of an asset owned by an entity, (i) a merger or consolidation of such entity (other than where such entity is the survivor thereof) or (ii) a distribution of such asset by such entity to its shareholders, partners, members, or other equity owners, including in connection with the dissolution, liquidation, winding-up or termination of such entity (unless, in the case of dissolution, such entity’s business is continued without the commencement of liquidation or winding-up); and (c) a disposition in connection with, or in lieu of, a foreclosure of an Encumbrance; but such terms shall not include the creation of an Encumbrance.
Disposing Member
– has the meaning set forth in Section 3.03(b)(ii)(A).
Disposition Notice
– has the meaning set forth in Section 3.03(b)(ii)(A).
Dispute
– has the meaning set forth in Section 11.01.
Disputing Member
– has the meaning set forth in Section 11.01.
Dissolution Event
– has the meaning set forth in Section 12.01(b).
Economic Risk of Loss
– has the meaning assigned to that term in Treasury Regulation Section 1.752-2(a).
Effective Date
– has the meaning set forth in the Preamble.
Encumber
,
Encumbering
, or
Encumbrance
– means the creation of a security interest, lien, pledge, mortgage or other encumbrance, other than a Permitted Encumbrance, whether such encumbrance be voluntary, involuntary or by operation of Law.
EQM
– means EQT Midstream Partners, LP, a Delaware limited partnership.
EQT
– has the meaning set forth in the Preamble.
Facilities
– means [●].
Fair Market Value
– means (i) the fair market cash value of the Membership Interest of the Changing Member as determined pursuant to the terms of Section 13.11(b) or (c), as applicable, or (ii) the fair market cash value of the consideration to be paid to the Disposing Member pursuant to the proposed Disposition as determined pursuant to the terms of Section 13.11(a) or (c), as applicable.
FERC
– means the Federal Energy Regulatory Commission or any Governmental Authority succeeding to the powers of such commission.
FERC Application
– means the document pursuant to which application for a certificate(s) of public convenience and necessity is made under Section 7 of the NGA to the FERC by the Company for authority to construct, own, acquire, and operate, and provide service on the Facilities.
FERC Certificate
– means the certificate(s) of public convenience and necessity issued by the FERC pursuant to the FERC Application.
FERC Response Date
– means the date that is 30 Days following the date upon which the FERC has issued the FERC Certificate.
Financing Commitment
– means the definitive agreements between one or more financial institutions or other Persons and the Company or the Financing Entity pursuant to which such financial institutions or other Persons agree, subject to the conditions set forth therein, to lend money to, or purchase securities of, the Company or the Financing Entity, the proceeds of which shall be used to finance all or a portion of the Facilities or to repay loans made by the Members pursuant to Section 4.02.
Financing Entity
– means a corporation, limited liability company, trust, or other entity that may be organized for the purpose of issuing securities, the proceeds from which are to be advanced directly or indirectly to the Company to finance all or a portion of the Facilities.
FMV Notice
– has the meaning set forth in Section 13.11(c).
Founding Members
– means EQT, USG and any of their respective Affiliates that are Members (and any limited partnership or master limited partnership to which such Members’ Membership Interests have been assigned pursuant to Section 3.03(e) or Section 3.03(f) of this Agreement); [***].
FPL
– has the meaning set forth in Section 6.05(f).
GAAP
– means United States generally accepted accounting principles.
Gas Transportation Service Agreements
– means the gas transportation service agreements by and between the Company or its designee and the Shippers for the transportation of natural gas through the Facilities.
[***]
Governmental Authority
(or
Governmental
) – means a federal, state, local or foreign governmental authority; a state, province, commonwealth, territory or district thereof; a county or parish; a city, town, township, village or other municipality; a district, ward or other subdivision of any of the foregoing; any executive, legislative or other governing body of any of the foregoing; any agency, authority, board, department, system, service, office, commission, committee, council or other administrative body of any of the foregoing; including the FERC, any court or other judicial body; and any officer, official or other representative of any of the foregoing.
including –
means including, without limitation.
Indebtedness
– means any amount (absolute or contingent) payable by the Company as debtor, borrower, issuer, guarantor or otherwise, pursuant to (a) an agreement or instrument involving or evidencing money borrowed, the advance of credit, a conditional sale or a transfer with recourse or with an obligation to repurchase; (b) indebtedness of a third party guaranteed by or secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any lien on assets owned or acquired by the Company, whether or not the indebtedness secured thereby has been assumed; (c) purchase-money indebtedness and capital lease obligations; (d) an interest rate protection agreement, foreign currency exchange agreement or other hedging arrangement; or (e) a letter of credit issued for the account of the Company.
Independent Accounting Firm
– has the meaning set forth in Section 3.03(b)(viii).
Initial Operating Budget
– has the meaning set forth in Section 4.01(a)(i).
Initial Release
– has the meaning set forth in Section 4.01(b)(i).
Investment Grade
– means, with respect to any Person, having debt rated as investment grade by at least two of the three nationally-recognized ratings agencies, being at least [***] for Moody’s Investor Services and at least [***] for each of Standard & Poor’s and Fitch Ratings.
In-Service Date
– means the date of the placing of the Facilities in service. On, or as promptly as practicable after, such date, the Operator shall notify the Members of its occurrence.
Law
– means any applicable constitutional provision, statute, act, code (including the Code), law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision, declaration, or interpretative or advisory opinion or letter of a Governmental Authority having valid jurisdiction.
Letter of Credit
– means an irrevocable, unconditional, transferable standby letter of credit in form and substance satisfactory to the Management Committee for the benefit of the Company, issued by a United States bank or a foreign bank with a United States branch, with United States based assets of at least $10,000,000,000 and a rating of [***] or better from Standard & Poor’s Ratings Service or a rating of [***] from Moody’s Investor Service.
Management Committee
– has the meaning set forth in Section 6.02.
Material Contracts
– means any of the following contracts, agreements, letter agreements or other instruments to which the Company is or becomes a party after the Effective Date: engineering, procurement and construction contracts, contracts for the construction of the Facilities, contracts for the procurement of pipe, compression and associated equipment and any other contracts that require expenditures by the Company in excess of [***] Dollars ($[***]) in the aggregate or provide for revenue to the Company in excess of [***] Dollars ($[***]), in each case, subject to the approval of the Management Committee pursuant to Section 6.02(i)(D).
Matured Financing Obligation
– means the Company’s debt for borrowed money (including any related interest, costs, fees, hedge unwind costs or other repayment obligations) that has become due (including by acceleration or any full or partial mandatory prepayment thereof) under any Financing Commitment.
Member
– means any Person executing this Agreement as of the date of this Agreement as a member or hereafter admitted to the Company as a member as provided in this Agreement, but such term does not include any Person who has ceased to be a member in the Company.
Member Nonrecourse Debt
– has the meaning assigned to the term “partner nonrecourse debt” in Treasury Regulation Section 1.704-2(b)(4).
Member Nonrecourse Debt Minimum Gain
– has the meaning assigned to the term “partner nonrecourse debt minimum gain” in Treasury Regulation Section 1.704-2(i)(2).
Member Nonrecourse Deductions
– has the meaning assigned to the term “partner nonrecourse deductions” in Treasury Regulation Sections 1.704-2(i)(1) and 1.704-2(i)(2).
Membership Interests
– has the meaning set forth in Section 3.01(a).
Minimum Gain
– means (a) with respect to Nonrecourse Liabilities, the amount of gain that would be realized by the Company if it disposed of (in a taxable transaction) all Company properties that are subject to the Nonrecourse Liabilities in full satisfaction of the Nonrecourse Liabilities, computed in accordance with Treasury Regulations Section 1.704-2(d), or (b) with respect to each Member Nonrecourse Debt, the amount of gain that would be realized by the Company if it disposed of (in a taxable transaction) the Company property that is subject to such Member Nonrecourse Debt in full satisfaction of such Member Nonrecourse Debt, computed in accordance with Treasury Regulations Section 1.704-2(i).
Necessary Regulatory Approvals
– means all Authorizations as may be required (but excluding Authorizations of a nature not customarily obtained prior to commencement of construction of facilities) in connection with (a) the formation of the Company and the construction, acquisition and operation of the Facilities; and (b) the transportation of the natural gas to be transported under the applicable Gas Transportation Service Agreements through the Facilities including the FERC Certificate.
New Member
– means a Person, other than EQT or USG, admitted after the Effective Date pursuant to the terms and conditions of this Agreement.
NGA
– means the Natural Gas Act of 1938, as amended.
Non-Contributing/Loan Member
– has the meaning set forth in Section 4.06(a).
Non-Changing Founding Member
– has the meaning set forth in Section 3.03(b)(vi)(C).
Non-Disposing Founding Member
– has the meaning set forth in Section 3.03(b)(ii)(A).
Nonrecourse Deductions
– has the meaning assigned that term in Treasury Regulation Sections 1.704-2(b) and 1.704-2(c).
Nonrecourse Liabilities
– means nonrecourse liabilities (or portions thereof) of the Company for which no Member bears the economic risk of loss, as determined under Treasury Regulations Section 1.704-2(b)(3) and 1.752-1(a)(2).
Non-Termination Member
– has the meaning set forth in Section 3.03(b)(viii).
Operator
– means [●], and any successor operator appointed following a termination of the COM Agreement.
Operating Budget
– means the Initial Operating Budget and each subsequent annual operating budget for the Company that is approved (or deemed approved) pursuant to Section 6.02(i)(GG). The Operating Budget shall cover all items that are classified as non-capital items under Required Accounting Practices.
[***]
Operator Preferential Right
– has the meaning set forth in Section 3.03(b)(ii)(D).
Outstanding Capital Contributions
– means, with respect to any Member as of the time of any determination, the excess, if any, of (i) the aggregate Capital Contributions previously made by such Member, over (ii) the aggregate distributions previously made by the Company to such Member pursuant to Article 5.
Parent
– means (i) with respect to a Member, the Person that directly or indirectly Controls such Member as set forth in
Exhibit A
, which shall be promptly updated by a Member upon any change to the identity of such Member’s Parent, or (ii) with respect to the Operator, the Person that ultimately Controls the Operator.
Parent Decision Makers
– means the chief executive officer of the Parent of each of USG and EQT or another senior executive officer designated in writing by the chief executive officer of the Parent of each of USG and EQT (a copy of which writing to be delivered promptly to the other Founding Member(s)).
Performance Assurances
– has the meaning set forth in Section 4.01(b)(i).
Permitted Encumbrance
– means (i) liens for taxes or assessments not yet due or not yet delinquent or, if delinquent, that are being contested in good faith in the normal course of business; (ii) easements, rights-of-way, servitudes, permits, surface leases, and other rights in respect of surface operations, pipelines, grazing, logging, canals, ditches, reservoirs or the like, and easements for streets, alleys, highways, pipelines, telephone lines, power lines, railways, and other easements and rights-of-way, on, over or in respect of any properties that do not materially impair the use of the assets of, or the operation of the business of, the Company; and (iii) rights reserved to or vested in any municipality or governmental, statutory, or public authority to control or regulate any properties in any manner, and all applicable Laws of any Governmental Authority.
Person
– has the meaning assigned that term in Section 18-101(11) of the Act and also includes a Governmental Authority and any other entity.
Precedent Agreement
– means any agreement between the Company and a prospective shipper of natural gas through the Facilities that involves the commitment by such shipper to pay demand charges in return for a firm transportation obligation on the part of the Company, in each case subject to the satisfaction of one or more conditions precedent.
Preferential Exercise Notice
– has the meaning set forth in Section 3.03(b)(ii)(A).
Preferential
Purchasing Member
– has the meaning set forth in Section 3.03(b)(ii)(A).
Preferential Right
– has the meaning set forth in Section 3.03(b)(ii)(A).
[***]
[***]
Project Schedule
– has the meaning set forth in Section 4.01(a)(i).
Qualified Guarantor
– means, with respect to a Member, such Member’s Parent or a subsidiary of such Member’s Parent, in each case, so long as such Person is Investment Grade.
Quarter
– unless the context requires otherwise, means a fiscal quarter of the Company.
Related Party Matter –
means (a) any occurrence or circumstance where (i) the Company, on the one hand, and a Member or an Affiliate of such Member, on the other hand, propose to enter into, terminate, or amend a contract or arrangement with each other, including, without limitation, a Gas Transportation Service Agreement, a Precedent Agreement, the COM Agreement, or any other contract or arrangement, or (ii) any Member believes that a dispute has arisen between the Company and an Affiliate of any Member under a Gas Transportation Service Agreement, a Precedent Agreement, the COM Agreement, or any other contract or arrangement, or (iii) a matter with respect to enforcement under any such Gas Transportation Service Agreement, Precedent Agreement, COM Agreement, or other contract or arrangement is involved; (b) making any determination as to the suitability of a Qualified Guarantor of a Member (other than a Founding Member, which is addressed in the definition of “Qualified Guarantor”) or substitution of a successor Qualified Guarantor of such Member; (c) the appointment of any successor Operator or Shipper that is an Affiliate of a Member; (d) any decision by the Company to exercise any of the owner performance rights under Section 4.4 of the COM Agreement while an Affiliate of EQT or USG is the Operator; or (e) making any determination, not to be unreasonably withheld, with respect to the suitability of the Operator pursuant to clause (b) of the definition of Change of Control.
Representative
– has the meaning set forth in Section 6.02(a)(i).
Representative Budget Comments
– has the meaning set forth in Section 6.09.
Required Accounting Practices
– means the accounting rules and regulations, if any, at the time prescribed by the Governmental Authorities under the jurisdiction of which the Company is at the time operating and, to the extent of matters not covered by such rules and regulations, generally accepted accounting principles as practiced in the United States at the time prevailing for companies engaged in a business similar to that of the Company.
Rules
– has the meaning set forth in Section 11.05(a).
Selection Notice
– has the meaning set forth in Section 11.05(c).
Sharing Ratio
– means, subject in each case to adjustments in accordance with this Agreement or in connection with Dispositions of Membership Interests, (a) in the case of a Member executing this Agreement as of the date of this Agreement or a Person acquiring such Member’s Membership Interest, the percentage specified for that Member as its Sharing Ratio on
Exhibit A
with respect to the Company, and (b) in the case of Membership Interests issued pursuant to Section 3.04, the Sharing Ratio established pursuant thereto;
provided
that the total of all Sharing Ratios shall always equal 100%.
Shippers
– means any Person that (a) has entered into a Gas Transportation Service Agreement with the Company or its designee (or, if applicable, a Precedent Agreement relating thereto) to provide transportation of natural gas through the Facilities and (b) meets the criteria for creditworthiness determined by the Management Committee.
Sole Discretion
– has the meaning set forth in Section 6.02(f)(ii).
Subject Contract
– has the meaning set forth in Section 4.07(a).
Supermajority Interest
–
means the approval of the Representatives of the Founding Members representing greater than [***]% of the aggregate Sharing Ratios of the Founding Members.
Tax Matters Member
– has the meaning set forth in Section 8.03(a).
Term
– has the meaning set forth in Section 2.07.
Termination Member
– has the meaning set forth in Section 3.03(b)(viii).
Total Event Demand Amount
– has the meaning set forth in Section 4.07(b).
Treasury Regulations
– means the regulations (including temporary regulations) promulgated by the United States Department of the Treasury pursuant to and in respect of provisions of the Code. All references herein to sections of the Treasury Regulations shall include any corresponding provision or provisions of succeeding, similar or substitute, temporary or final Treasury Regulations.
USG
– has the meaning set forth in the Preamble.
Withdrawal
, or
Withdrawn
– means or refers to the withdrawal, resignation, or retirement of a Member from the Company as a Member. Such terms shall not include any Dispositions of Membership Interests (which are governed by Sections 3.03(a) and (b)), even though the Member making a Disposition may cease to be a Member as a result of such Disposition.
Withdrawn Member
– has the meaning set forth in Section 10.03.
Other terms defined herein have the meanings so given them.
|
|
1.04
|
Interpretation
. Unless the context requires otherwise: (a) the gender (or lack of gender) of all words used in this Agreement includes the masculine, feminine and neuter; (b) references to Articles and Sections refer to Articles and Sections of this Agreement; (c) references to Exhibits refer to the Exhibits attached to this Agreement, each of which is made a part hereof for all purposes; (d) references to Laws refer to such Laws as they may be amended from time to time, and references to particular provisions of a Law include any corresponding provisions of any succeeding Law; (e) references to money refer to legal currency of the United States of America; (f) the definitions given for terms in this Article 1 and elsewhere in this Agreement shall apply to both the singular and plural forms of the terms defined, (g) the conjunction “or” shall be understood in its inclusive sense (and/or); and (h) the words “hereby”, “herein”, “hereunder”, “hereof” and words of similar import refer to this Agreement as a whole (including any Exhibits and Schedules hereto) and not merely to the specific section, paragraph or clause in which such word appears.
|
Article 2
ORGANIZATION
|
|
2.09
|
Formation
. The Company has been organized as a Delaware limited liability company by the filing of the Delaware Certificate and execution of the Initial Agreement as of [●], 20[●].
|
|
|
2.10
|
Name
. The name of the Company is [●], LLC, and all Company business shall be conducted in that name or such other names that comply with Law as the Management Committee may select.
|
|
|
2.11
|
Registered Office; Registered Agent; Principal Office in the United States; Other Offices
. The registered office of the Company required by the Act to be maintained in the State of Delaware shall be the office of the initial registered agent named in the Delaware Certificate or such other office (which need not be a place of business of the Company) as the Management Committee may designate in the manner provided by Law. The registered agent of the Company in the State of Delaware shall be the initial registered agent named in the Delaware Certificate or such other Person or Persons as the Management Committee may designate in the manner provided by Law. The principal office of the Company in the United States shall be at such place as the Management Committee may designate, which need not be in the State of Delaware, and the Company shall maintain records there or such other place as the Management Committee shall designate and shall keep the street address of such principal office at the registered office of the Company in the State of Delaware. The Company may have such other offices as the Management Committee may designate.
|
|
|
2.12
|
Purposes
. The purposes of the Company are to plan, design, construct, acquire, own, finance, maintain, and operate the Facilities [and [●]].
|
|
|
2.13
|
No State Law Partnership
. The Members intend that the Company shall be a limited liability company and, except as provided in Article 8 with respect to U.S. federal income tax treatment (and other tax treatment therewith), the Company shall not be a partnership (including a limited partnership) or joint venture, and no Member shall be a partner or joint venture of any other Member, for any purposes, and this Agreement may not be construed to suggest otherwise.
|
|
|
2.14
|
Foreign Qualification
. Prior to the Company’s conducting business in any jurisdiction other than Delaware, the Management Committee shall cause the Company to comply, to the extent procedures are available and those matters are reasonably within the control of the Management Committee, with all requirements necessary to qualify the Company as a foreign limited liability company in that jurisdiction. At the request of the Management Committee, each Member shall execute, acknowledge, swear to, and deliver all certificates and other instruments conforming with this Agreement that are necessary or appropriate to qualify, continue, and terminate the Company as a foreign limited liability company in all such jurisdictions in which the Company may conduct business.
|
|
|
2.15
|
Term
. The period of existence of the Company (the
“
Term
”
) commenced on [●], 20[●], and shall end at such time as a certificate of cancellation is filed with the Secretary of State of Delaware in accordance with Section 12.04.
|
|
|
2.16
|
Title to Property
. All assets, property and rights of the Company shall be owned or leased by the Company as an entity and, except with respect to assets, property or rights of the Company leased or licensed to the Company by a Member (subject to the terms hereof), no Member shall have any ownership interest in such assets, property or rights in its individual name or right, and each Member’s Membership Interest shall be personal property for all purposes. The Company shall hold all assets, property and rights of the Company in the name of the Company and not in the name of any Member.
|
Article 3
MEMBERSHIP INTERESTS; DISPOSITIONS OF INTERESTS
|
|
3.10
|
Capital Structure
. The capital structure of the Company shall consist of one class of limited liability company interests called “
Membership Interests
,” which shall consist of, with respect to any Member, (a) that Member’s status as a Member; (b) that Member’s share of the income, gain, loss, deduction, and credits of, and the right to receive distributions from, the Company; (c) any [***] to which that Member is entitled pursuant to Section 4.06(b); (d) all other rights, benefits, and privileges enjoyed by that Member (under the Act, this Agreement, or otherwise) in its capacity as a Member, including that Member’s rights to vote, consent, and approve amendments to this Agreement pursuant to Section 13.05; (e) with respect to the Founding Members only, such Founding Members’ rights to participate in the management of the Company through the Management Committee; and (f) all obligations, duties, and liabilities imposed on that Member (under the Act or this Agreement or otherwise) in its capacity as a Member, including any obligations to make Capital Contributions to the extent set forth in Article 4. As of the Effective Date, EQT and USG are the Members of the Company with the Sharing Ratios set forth on
Exhibit A
hereto.
|
|
|
3.11
|
Representations, Warranties and Covenants
.
|
(f)
Each Member hereby represents, warrants, and covenants to the Company and to each other Member that the following statements are true and correct as of the Effective Date:
(viii)
that such Member is duly incorporated, organized, or formed (as applicable), validly existing, and (if applicable) in good standing under the Law of the jurisdiction of its incorporation, organization, or formation; if required by applicable Law, that such Member is duly qualified and in good standing in the jurisdiction of its principal place of business, if different from its jurisdiction of incorporation, organization, or formation; and that such Member has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder, and all necessary actions by the board of directors, officers, shareholders, managers, members, partners, trustees, beneficiaries, or other applicable Persons necessary for the due authorization, execution, delivery, and performance of this Agreement by that Member have been duly taken;
(ix)
that such Member has duly executed and delivered this Agreement and the other documents that this Agreement contemplates that such Member will execute, and they each constitute the valid and binding obligation of such Member enforceable against it in accordance with their respective terms (except as may be limited by bankruptcy, insolvency or similar Laws of general application and by the effect of general principles of equity, regardless of whether considered at law or in equity); and
(x)
that such Member’s authorization, execution, delivery, and performance of this Agreement does not and will not (A) conflict with, or result in a breach, default or violation of, (1) the organizational documents of such Member, (2) any contract or agreement to which that Member is a party or is otherwise subject, or (3) any Law, order, judgment, decree, writ, injunction, or arbitral award to which such Member is subject; or (B) other than the FERC Application and the Necessary Regulatory Approvals that the Members have agreed to obtain pursuant to Article 7, require any consent, approval, or authorization from, filing or registration with, or notice to, any Governmental Authority or other Person, unless such requirement has already been satisfied.
(g)
The Company hereby represents and warrants, and the Company covenants, to each Member that the following statements are true and correct as of the Effective Date:
(i)
(x) the Company is duly formed and is validly existing, and in good standing under the Act; (y) the Company has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder (including the issuance of the Membership Interests to each Member), and all necessary actions by the Company’s managers, members or other applicable Persons necessary for the due authorization, execution, delivery, and performance of this Agreement by the Company have been duly taken;
(ii)
the issuance of the Membership Interests to each Member, as contemplated hereby, has been duly authorized by all requisite limited liability company action on the part of the Company and its members, managers or other applicable Persons, and such Membership Interests are validly issued and, subject only to the terms of Article 4, fully paid and nonassessable and, subject to the restrictions in Article 3, are being issued free and clear of any preemptive rights under the Act or other applicable law, the organizational documents of the Company, and any other contract to which the Company or its members, managers or other Person is bound or by which their property is subject;
(iii)
no other Person has any right to acquire any Membership Interest or other equity interest in the Company or take part in the management of the Company; and
(iv)
the Company has not entered into any contract, agreement, or other arrangement with any Person with respect to the Company, the Facilities, the Membership Interests, or voting rights with respect to the Company.
|
|
3.12
|
Dispositions and Encumbrances of Membership Interests
.
|
(a)
General Restriction
. A Member may not Dispose of or Encumber all or any portion of its Membership Interest except in strict accordance with this Section 3.03. References in this Section 3.03 to Dispositions or Encumbrances of a “Membership Interest” shall also refer to Dispositions or Encumbrances of a portion of a Membership Interest. Any attempted Disposition or Encumbrance of a Membership Interest, other than in strict accordance with this Section 3.03, shall be, and is hereby declared, null and void
ab initio
. The rights and obligations constituting a Membership Interest may not be separated, divided, or split from the other attributes of a Membership Interest except as contemplated by the express provisions of this Agreement. The Members agree that the provisions of this Section 3.03 may be enforced by specific performance pursuant to Section 11.04.
|
|
(b)
|
Dispositions of Membership Interests.
|
(iii)
General Restriction
. Subject to Sections 3.03(e) and (f), no Member may Dispose of its Membership Interest without the prior written consent of each of EQT and USG, which consent may be withheld by each in its Sole Discretion;
provided
,
however
, that no such consent shall be required (A) with respect to a Founding Member, where such Disposition would not cause the Company to be treated as a publicly traded partnership subject to tax as an association for U.S. federal income tax purposes, and (B) with respect to any Member (other than a Founding Member), where such Disposition (x) when added to all Dispositions by such Member during the immediately preceding twelve (12) months, is less than 50% of such Member’s Sharing Ratio as of the beginning of such period of twelve (12) months, (y) would not cause any adverse tax consequences to the Company or any Member, and (z) would not cause the Company to be treated as a publicly traded partnership subject to tax as an association for U.S. federal income tax purposes. Subject to receiving the consent required in the foregoing sentence, if necessary, a Member may Dispose of its Membership Interest only by complying with all of the following requirements: (I) such Member must offer the Founding Members the right to acquire such Membership Interest in accordance with Section 3.03(b)(ii), unless (1) the proposed Assignee is an Affiliate of the Disposing Member or the Founding Members consent to the Disposition to such Assignee, which consent may be granted or withheld in the Sole Discretion of each Founding Member or (2) the Disposition is made by EQT or USG in accordance with Section 3.03(e) or (f); (II) such Member must comply with the requirements of Section 3.03(b)(iv) and, if the Assignee is to be admitted as a Member, Section 3.03(b)(iii); and (III) unless the proposed Assignee is an Affiliate of the Disposing Member, the Disposition must comply with the following minimum size requirements: (1) if such Member’s Sharing Ratio is less than [***]%, the Disposition must include all of the Member’s Membership Interest, and (2) if such Member’s Sharing Ratio is [***]% or more, but such Member does not propose to dispose of all of its Membership Interest, the Disposition must be of a Membership Interest having a Sharing Ratio of at least [***]%.
(iv)
Preferential Purchase Rights
.
(E)
Preferential Purchase Rights
. Subject to Section 3.03(b)(ii)(B), if a Member desires to consummate a bona fide transaction that will result in the Disposition of all or a portion of its Membership Interest (whether or not the proposed Disposition is to another Member), then such Member (the “
Disposing Member
”) shall promptly give notice thereof (the “
Disposition Notice
”) to the Company and each Founding Member;
provided
that this Section 3.03(b)(ii) shall not apply to a Disposition to an Affiliate of the Disposing Member or a Disposition in accordance with Section 3.03(e) or Section 3.03(f). The Disposition Notice shall set forth all relevant information with respect to the proposed Disposition, including the name and address of the prospective acquirer, the precise Membership Interest that is the subject of the Disposition, the price to be paid for such Membership Interest, and any other terms and conditions of the proposed Disposition. If any Member is a Disposing Member but either or both of EQT and/or USG and their respective Affiliates are not the Disposing Member (such of EQT and/or USG and their respective Affiliates as is not a Disposing Member being referred to herein as the “
Non-Disposing Founding Member(s)
”), such Non-Disposing Founding Member(s) shall have the right (the “
Preferential Right
”) to acquire, for the same purchase price, and on the same material terms and conditions, as are set forth in the Disposition Notice, some or all of the Membership Interest specified in the Disposition Notice;
provided
that, if the purchase price to be paid to the Disposing Member pursuant to the proposed Disposition is not entirely in cash, the purchase price for the Non-Disposing Founding Member(s) exercising the Preferential Right shall be [***]. The Non-Disposing Founding Member(s) shall have [***] Days following receipt of the Disposition Notice (or if the price to be paid pursuant to such offer is not in cash, then [***] Days following [***]) in which to notify the other Members (including the Disposing Member) whether such Non-Disposing Founding Member(s) desires to exercise its Preferential Right. A notice in which a Non-Disposing Founding Member exercises such Preferential Right is referred to herein as a “
Preferential Exercise Notice
” and as deliverer of a Preferential Exercise Notice, such Non-Disposing Founding Member is referred to herein as a “
Preferential
Purchasing Member
.” The Preferential Purchasing Member(s) shall indicate in a Preferential Exercise Notice whether the Preferential Purchasing Member(s) elects to purchase all of the Disposing Member’s Membership Interest as set forth in the Disposition Notice or any portion thereof. In the event that more than one of EQT or USG (or their respective Affiliates) is a Preferential Purchasing Member, then each Preferential Purchasing Member shall indicate in a Preferential Exercise Notice whether it elects to purchase only its
pro rata
share of the Membership Interest offered in the Disposition Notice (based on its Sharing Ratio) or whether such Preferential Purchasing Member elects to purchase a greater portion of such Membership Interest (up to the full amount thereof). If the Preferential Purchasing Member(s) elects to exercise the Preferential Right to purchase the entire Membership Interest offered in the Disposition Notice (subject to proration based on the Preferential Purchasing Members’ respective Sharing Ratios in the event that Preferential Purchasing Members elected to purchase a greater number of Membership Interests than the amount offered), the Disposing Member and the Preferential Purchasing Member(s) shall close the acquisition of the Membership Interest in accordance with Section 3.03(b)(ii)(C). In the event that the Preferential Purchasing Member(s) elect to purchase less than the entire Membership Interest specified in the Disposition Notice, then the Disposing Member shall have the right to Dispose of the remaining amount of the unexercised portion of the Membership Interest in accordance with Section 3.03(b)(ii)(C).
(F)
Preferential Purchase Right Resulting from Disposition of Membership Interests Held by the Operator
. Notwithstanding the foregoing, for so long as the Operator is an Affiliate of a Member, if the Disposing Member is the Operator and the Assignee of such Disposing Member’s Membership Interests is not an Affiliate of such Member (including, for the avoidance of doubt, in the event the Operator is an Affiliate of EQT or EQM, where the Assignee is not an Affiliate of either EQT or EQM), then such Disposing Member shall promptly deliver the Disposition Notice to the Non-Disposing Founding Members that are not Affiliates of the Operator, and such Non-Disposing Founding Members and their Affiliates shall have the right (the “
Operator Preferential Right
”) to acquire a portion of the Membership Interests of the Disposing Member for the same purchase price and on the same material terms and conditions as are set forth in the Disposition Notice;
provided
that, if the purchase price to be paid to the Disposing Member pursuant to the proposed Disposition is not entirely in cash, the purchase price shall be [***]. The Non-Disposing Founding Members and their Affiliates shall have [***] Days following receipt of the Disposition Notice (or if the price to be paid pursuant to such offer is not in cash, then [***] Days following [***]) in which to notify the Disposing Member whether they desire to exercise the Operator Preferential Right. To the extent a Non-Disposing Founding Members or any of its Affiliates exercises its Operator Preferential Right, such Non-Disposing Founding Member (or its Affiliate) will be deemed a Preferential Purchasing Member. If the Non-Disposing Founding Member or any of its Affiliates elects to exercise the Operator Preferential Right to purchase the entire Membership Interest offered in the Disposition Notice, then the Disposing Member and the Non-Disposing Founding Member (or its Affiliate) shall close the acquisition of the Membership Interest in accordance with Section 3.03(b)(ii)(C). In the event that the Non-Disposing Founding Member (or its Affiliate) elects to purchase less than the entire Membership Interest specified in the Disposition Notice, then the Disposing Member shall have the right to Dispose of the remaining amount of the unexercised portion of the Membership Interest in accordance with Section 3.03(b)(ii)(C).
(G)
Closing
. If the Preferential Rights are exercised in accordance with Section 3.03(b)(ii)(A) or 3.03(b)(ii)(B), as applicable, the closing of the purchase of the Membership Interest shall occur at the principal place of business of the Company no later than the [***] Day after the expiration of the [***]-Day period referred to in Section 3.03(b)(ii)(A) or Section 3.03(b)(ii)(B), as applicable (or, if later, the fifth Business Day after the receipt of all applicable Authorizations to the purchase), unless the Disposing Member and the Preferential Purchasing Member(s) agree upon a different place or date. At the closing, (1) the Disposing Member shall execute and deliver to the Preferential Purchasing Member(s) (aa) an assignment of the Membership Interest, in form and substance reasonably acceptable to the Preferential Purchasing Member(s) containing a general warranty of title as to such Membership Interest (including that such Membership Interest is free and clear of all Encumbrances, other than those permitted under Section 3.03(c)(ii)) and (bb) any other instruments reasonably requested by the Preferential Purchasing Member(s) to give effect to the purchase; and (2) the Preferential Purchasing Member(s) shall deliver to the Disposing Member in immediately-available funds the purchase price provided for in Section 3.03(b)(ii)(A) or Section 3.03(b)(ii)(B), as applicable. The Sharing Ratios and Capital Accounts of the Members shall be deemed adjusted to reflect the effect of the purchase.
(H)
Waiver of Preferential Right
. If no Non-Disposing Founding Member delivers a First Preferential Exercise Notice or Second First Preferential Exercise Notice, or if the Preferential Rights are not exercised in full pursuant to Section 3.03(b)(ii)(A) or 3.03(b)(ii)(B), the Disposing Member shall have the right, subject to compliance with the provisions of Sections 3.03(a) and (b), to Dispose of the portion of the Membership Interest described in the Disposition Notice that is not purchased pursuant to the Preferential Rights to the proposed Assignee strictly in accordance with the terms of the Disposition Notice for a period of [***] Days after the expiration of the [***]-Day period referred to in such Section 3.03(b)(ii)(A) or 3.03(b)(ii)(B) (or, if later, the fifth Business Day after the receipt of all applicable Authorizations to the purchase). If, however, the Disposing Member fails so to Dispose of the Membership Interest within such [***]-Day period (or, if applicable, such fifth Business Day period), the proposed Disposition shall again become subject to the Preferential Rights.
(I)
Transfer of Operator Rights
. In connection with a Disposition of Membership Interests where the rights provided for in this Section 3.03(b)(ii) are not exercised or where such rights are waived pursuant to Section 3.03(b)(ii)(D), the Member with the right to appoint the Operator (which Member shall initially be EQT) may transfer such right to appoint the Operator to the assignee of such Membership Interests; [***].
(v)
Admission of Assignee as a Member
. An Assignee has the right to be admitted to the Company as a Member, with the Membership Interest and attendant Sharing Ratio) so transferred to such Assignee, only upon consent of the Management Committee and only if such Disposition is effected in strict compliance with Sections 3.03(a) and (b) or is effected in accordance with Section 3.03(e) or Section 3.03(f).
(vi)
Requirements Applicable to All Dispositions and Admissions
. In addition to the requirements set forth in Sections 3.03(b)(i), 3.03(b)(ii) and 3.03(b)(iii), any Disposition of a Membership Interest and any admission of an Assignee as a Member shall also be subject to the following requirements, and such Disposition (and admission, if applicable) shall not be effective unless such requirements are complied with;
provided
the Management Committee, in its sole and absolute discretion, may waive any of the following requirements:
(A)
Disposition Documents
. The following documents must be delivered to the Management Committee and must be satisfactory, in form and substance, to the Management Committee in its sole and absolute discretion:
(1)
Disposition Instrument
. A copy of the instrument pursuant to which the Disposition is effected.
(2)
Ratification of this Agreement
. An instrument, executed by the Disposing Member and its Assignee, containing the following information and agreements, to the extent they are not contained in the instrument described in Section 3.03(b)(iv)(A)(1): (aa) the notice address of the Assignee; (bb) if applicable, the Parent of the Assignee; (cc) the Sharing Ratios after the Disposition of the Disposing Member and its Assignee (which together must total the Sharing Ratio of the Disposing Member before the Disposition); (dd) the Assignee’s ratification of this Agreement and agreement to be bound by it, and its confirmation that the representations and warranties in Section 3.02 are true and correct with respect to it; and (ee) representations and warranties by the Disposing Member and its Assignee (1) that the Disposition and admission is being made in accordance with all applicable Laws, (2) that the matter set forth in Section 3.03(b)(iv)(A)(3) is true and correct, and (3) that the Disposition and admission do not violate any Financing Commitment or any other agreement to which the Company is a party.
(3)
Securities Law Opinion
. Unless the Membership Interest subject to the Disposition is registered under the Securities Act of 1933, as amended, and any applicable state securities Law, a favorable opinion of the Disposing Member’s legal counsel, or, if so elected by the Management Committee, the Company’s legal counsel or other legal counsel acceptable to the Management Committee, to the effect that the Disposition and admission is being made pursuant to a valid exemption from registration under those Laws and in accordance with those Laws;
provided
that no such opinion shall be required in the case of a Disposition by a Member to an Affiliate or a Disposition made in accordance with Section 3.03(e) or Section 3.03(f).
(4)
Tax Opinion
. A favorable opinion of the Disposing Member’s legal counsel, or, if so elected by the Management Committee, the Company’s legal counsel or other legal counsel acceptable to the Management Committee, to the effect that the Disposition would not cause the Company to be treated as a publicly traded partnership subject to tax as an association for U.S. federal income tax purposes (unless the provision of such tax opinion is waived in advance by the Management Committee);
provided
that no such opinion shall be required in the case of a Disposition by a Member to an Affiliate or a Disposition made in accordance with Section 3.03(e) or Section 3.03(f).
(B)
Payment of Expenses
. The Disposing Member and its Assignee shall pay, or reimburse the Company for, all reasonable costs and expenses incurred by the Company in connection with the Disposition and admission, including the legal fees incurred in connection with the legal opinions referred to in Section 3.03(b)(iv)(A)(3) and (4), on or before the 10th Day after the receipt by that Person of the Company’s invoice for the amount due. The Company will provide such invoice as soon as practicable after the amount due is determined but in no event later than [***] Days thereafter. If payment is not made by the date due, the Person owing that amount shall pay interest on the unpaid amount from the date due until paid at a rate per annum equal to the Default Rate.
(C)
No Release
. No Disposition of a Membership Interest shall effect a release of the Disposing Member from any liabilities to the Company or the other Members arising from events occurring prior to the Disposition.
(D)
Indebtedness of Company
. Any Disposition of all or any portion of the Membership Interest of a Member shall also include the Disposition of a proportionate share of the Indebtedness owed by the Company to the Disposing Member. As long as this Agreement shall remain in effect, all evidences of Indebtedness of the Company owed to any of the Members shall bear an appropriate legend to indicate that it is held subject to, and may be Disposed only in accordance with, the terms and conditions of this Agreement, and that such Disposition may be made only in conjunction with the Disposition of a proportionate part of such Member’s Membership Interest.
(vii)
Deemed Membership Disposition
. A Deemed Membership Disposition shall be deemed to be a Disposition of a Membership Interest and must comply with the requirements set forth in Sections 3.03(a) and (b).
(viii)
Change of Control
.
(A)
[***]
(B)
Change of Control of Member That Is the Operator
. Notwithstanding the foregoing, [***].
(C)
Closing
. If the [***].
(D)
Definitions
. As used in this Section 3.03(b)(vi), [***].
(ix)
[
Intentionally omitted
.]
(x)
[***]
(c)
Encumbrances of Membership Interest
. A Member may not Encumber its Membership Interest, except by complying with one of the two following paragraphs:
(iii)
(A) such Member must receive the consent of [***] of the non-Encumbering Founding Members (calculated without reference to the Sharing Ratio of the Encumbering Founding Member), which consent (as contemplated by Section 6.02(f)(ii)) may be granted or withheld in the Sole Discretion of each such other Member; and (B) the instrument creating such Encumbrance must provide that any foreclosure of such Encumbrance (or Disposition in lieu of such foreclosure) must comply with the requirements of Sections 3.03(a) and (b); or
(iv)
such Encumbrance [***].
(d)
[Intentionally omitted.]
(e)
EQT
[***]
and Related Assignment Rights
. Notwithstanding anything in this Agreement to the contrary, EQT shall have the right from time to time to sell or assign (i) to [***], or (ii) to any [***] other Person Controlled by EQT or its then Parent all or any part of the Membership Interest then held by EQT or its Affiliates (
provided
that, in either case, if such sale or assignment occurs prior to the In-Service Date, then, at the time of such sale or assignment, such Assignee provides the Company with replacement Performance Assurances, if applicable, meeting the requirements of Section 4.01(b)), and any such Assignee may further sell or assign such Membership Interest to any such Person, directly or indirectly through multiple sales or assignment among Affiliates, in each case, without any consent from USG or its Affiliates and without triggering any rights or restrictions under or the provisions of Section 3.03(b)(ii) or during the period commencing on the Effective Date through the twelve-month anniversary of the In-Service Date, Section 3.03(b)(viii). EQT shall promptly provide to the Company and USG copies of the assignment instrument and the ratification instrument associated with each such sale or assignment, and the Members shall amend
Exhibit A
to reflect the Sharing Ratios set forth in such ratification instrument.
(f)
USG
[***]
and Related Assignment Rights
. Notwithstanding anything in this Agreement to the contrary, USG shall have the right from time to time to sell or assign to any [***] other Person Controlled by USG or its then Parent all or any part of the Membership Interest then held by USG or its Affiliates (
provided
that, in either case, if such sale or assignment occurs prior to the In-Service Date, then, at the time of such sale or assignment, such Assignee provides the Company with replacement Performance Assurances, if applicable, meeting the requirements of Section 4.01(b)), and any such Assignee may further sell or assign such Membership Interest to any such Person, directly or indirectly through multiple sales or assignments among Affiliates, in each case, without any consent from EQT or its Affiliates and without triggering any rights or restrictions under or the provisions of Section 3.03(b)(ii) or during the period commencing on the Effective Date through the twelve-month anniversary of the In-Service Date, Section 3.03(b)(viii). USG shall promptly provide to the Company and EQT copies of the assignment instrument and the ratification instrument associated with each such sale or assignment, and the Members shall amend
Exhibit A
to reflect the Sharing Ratios set forth in such ratification instrument.
|
|
3.13
|
Creation of Additional Membership Interests
. Additional Membership Interests may be created and issued to existing Members or to other Persons ([***]), and such other Persons may be admitted to the Company as Members, with the consent of [***], on such terms and conditions as [***] may determine at the time of admission. The terms of admission or issuance must specify the Sharing Ratios applicable thereto and may provide for the creation of different classes of Members having different rights, powers and duties. Any such admission is effective only after the New Member has executed and delivered to the Members an instrument containing the notice address of the New Member, the Assignee’s ratification of this Agreement and agreement to be bound by it, and its confirmation that the representations and warranties in Section 3.02 are true and correct with respect to it. The provisions of this Section 3.04 shall not apply to Dispositions of Membership Interests or admissions of Assignees in connection therewith, such matters being governed by Sections 3.03(a) and (b).
|
|
|
3.14
|
Access to Information
.
(a)
Each Founding Member of the Company shall be entitled to receive any information that it may request concerning the Company;
provided
that this Section 3.05 shall not obligate the Company, the Management Committee, or the Operator to create any information that does not already exist at the time of such request (other than to convert existing information from one medium to another, such as providing a printout of information that is stored in a computer database), except as otherwise provided in Section 9.02. Each Founding Member shall also have the right, upon reasonable notice, and at all reasonable times during usual business hours to inspect the properties of the Company and to audit, examine, and make copies of the books of account and other records of the Company and to have access to the employees of the Operator to discuss the Company’s businesses and financial affairs. Such right may be exercised through any agent or employee of such Founding Member designated in writing by it or by an independent public accountant, engineer, attorney or other consultant so designated. The Founding Member making the request shall bear all costs and expenses incurred in any inspection, examination or audit made on such Founding Member’s behalf. The Founding Members and the Operator agree to reasonably cooperate, and to cause their respective independent public accountants, engineers, attorneys or other consultants to reasonably cooperate, in connection with any such request. Confidential Information obtained pursuant to this Section 3.05(a) shall be subject to the provisions of Section 3.06.
|
(b)
Each New Member shall be entitled to receive only the information and reports set forth in Section 9.02. Confidential Information received pursuant to this Section 3.05(b) shall be subject to the provisions of Section 3.06.
|
|
3.15
|
Confidential Information
.
(a)
Except as permitted by Section 3.06(b), (i) each Member shall keep confidential all Confidential Information and shall not disclose any Confidential Information to any Person, including any of its Affiliates, and (ii) each Member shall use the Confidential Information only in connection with the Facilities and the Company.
|
(b)
Notwithstanding Section 3.06(a), but subject to the other provisions of this Section 3.06, a Member may make the following disclosures and uses of Confidential Information:
(xi)
disclosures to another Member or to the Operator in connection with the Company;
(xii)
disclosures and uses that are approved in advance by the Management Committee;
(xiii)
disclosures that may be required from time to time to obtain requisite Authorizations or financing for the Facilities, if such disclosures are approved in advance by the Management Committee;
(xiv)
disclosures to an Affiliate of such Member, including the directors, officers, members, managers, employees, agents and advisors of such Affiliate, if such Affiliate has agreed to abide by the terms of this Section 3.06;
provided
,
however
, that in no event shall [***];
(xv)
disclosures to a Person that is not a Member or an Affiliate of a Member, if such Person has been retained by the Company, a Member, or the Operator to provide services in connection with the Company and has agreed to abide by the terms of this Section 3.06;
(xvi)
disclosures to a bona fide potential direct or indirect purchaser of such Member’s Membership Interest, if such potential purchaser has executed a confidentiality agreement in form and substance acceptable to the Management Committee;
(xvii)
disclosures required, with respect to a Member or an Affiliate of a Member, pursuant to (i) the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, (ii) the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, (iii) any state securities Laws, or (iv) any national securities exchange or automated quotation system; and
(xviii)
disclosures that a Member is legally compelled to make by deposition, interrogatory, request for documents, subpoena, civil investigative demand, order of a court of competent jurisdiction, or similar process, or otherwise by Law or that a Member makes to a Governmental Authority or regulatory authority pursuant to a regulatory request, examination, or audit;
provided
that, prior to any such disclosure, such Member shall, to the extent legally permissible:
(A)
provide the Management Committee with prompt notice of such requirements so that one or more of the Members may seek a protective order or other appropriate remedy or waive compliance with the terms of this Section 3.06(b)(viii);
(B)
consult with the Management Committee on the advisability of taking steps to resist or narrow such disclosure; and
(C)
cooperate with the Management Committee and with the other Members in any attempt one or more of them may make to obtain a protective order or other appropriate remedy or assurance that confidential treatment will be afforded the Confidential Information; and in the event such protective order or other remedy is not obtained, or the other Members waive compliance with the provisions hereof, such Member agrees (1) to furnish only that portion of the Confidential Information that, in the opinion of such Member’s counsel, such Member is legally required to disclose, and (2) to exercise all reasonable efforts to obtain assurance that confidential treatment will be accorded such Confidential Information.
(c)
Each Member shall take such precautionary measures as may be required to ensure (and such Member shall be responsible for) compliance with this Section 3.06 by any of its Affiliates, and its and their directors, officers, employees and agents, and other Persons to which it may disclose Confidential Information in accordance with this Section 3.06.
(d)
Promptly after any Withdrawal or Disposition by any Member of all of its Membership Interests pursuant to Sections 3.03 or 10.02, a Withdrawn Member or Disposing Member, as applicable, shall promptly destroy (and provide a certificate of destruction to the Company with respect to), or return to the Company, all Confidential Information in its possession. Notwithstanding the immediately preceding sentence, but subject to the other provisions of this Section 3.06, a Withdrawn Member or Disposing Member may retain for a stated period, but not disclose to any other Person, Confidential Information for the limited purposes of (i) explaining such Member’s corporate decisions with respect to the Facilities; (ii) preparing such Member’s tax returns and defending audits, investigations and proceedings relating thereto; or (iii) in compliance with such Member’s document retention policy;
provided
that the Withdrawn Member or Disposing Member must notify the Management Committee in advance of such retention and specify in such notice the stated period of such retention.
(e)
The Members agree that no adequate remedy at law exists for a breach or threatened breach of any of the provisions of this Section 3.06, the continuation of which unremedied will cause the Company and the other Members to suffer irreparable harm. Accordingly, the Members agree that the Company and the other Members shall be entitled, in addition to other remedies that may be available to them, to immediate injunctive relief from any breach of any of the provisions of this Section 3.06 and to specific performance of their rights hereunder, as well as to any other remedies available at law or in equity, pursuant to Sections 11.03 and 11.04.
(f)
The obligations of the Members under this Section 3.06 (including the obligations of any Withdrawn Member) shall terminate on the [***] anniversary of the end of the Term.
|
|
3.16
|
Liability to Third Parties
. No Member or its Affiliates shall be liable for the debts, obligations or liabilities of the Company.
|
|
|
3.17
|
Use of Members’ Names and Trademarks
. The Company, the Members and their Affiliates shall not use the name or trademark of any Member or its Affiliates in connection with public announcements regarding the Company, or marketing or financing activities of the Company, without the prior written consent of such Member or Affiliate.
|
Article 4
CAPITAL CONTRIBUTIONS/LOANS
|
|
4.08
|
Capital Contributions
.
(j)
(i)
Promptly following the Effective Date, but in any event no later than 120 Days thereafter, EQT shall provide to USG (A) a capital budget covering the design, engineering, procurement, construction and installation of the Facilities through the In-Service Date (the “
Construction Budget
”); (B) a schedule (the “
Project Schedule
”) containing milestones and including details to support all major development, engineering, procurement, construction, commissioning and testing activities of the Facilities during the period prior to the In-Service Date; and (C) an operating budget covering the [***] period following the In-Service Date (the “
Initial Operating Budget
”). If such Construction Budget, Project Schedule and Initial Operating Budget are not approved by a Supermajority Interest by the [***] Day following the delivery thereof to USG, the Company may be dissolved pursuant to Section 12.01(b)(v).
|
(ii)
As to the Construction Budget, the Initial Operating Budget and any Capital Budget associated with the Facilities covered by any Approved Precedent Agreement approved by the Management Committee in accordance with Section 6.02(i)(S) or 6.02(i)(GG), no further approval of [***] shall be required for the Capital Contributions required to fund such budget or project as set forth therein, subject to Section 6.02(i)(S) or 6.02(i)(GG); rather, subject to and in accordance with the COM Agreement, the Operator shall issue written notices to the Company for such Capital Contribution and, subject to Sections 6.02(i)(I) and (K), loans from Members, at such times and in such amounts necessary to fund the costs associated with such budget or project.
(iii)
In connection with each individual Capital Call required under the Construction Budget, the Initial Operating Budget, each subsequent Operating Budget, and any Capital Budget associated with the Facilities covered by any Approved Precedent Agreement, by the affirmative vote of [***] of the Management Committee, will determine what portion (if any) of such funding will be made pursuant to Capital Contributions and what portion (if any) of such funding will be made by loans by the Members to the Company. Upon receipt of each notice issued by the Operator pursuant to Section 4.01(a)(ii), the Company shall issue written requests to each Member, consistent with the determination made pursuant to the preceding sentence, for the making of the Capital Contributions and/or loans required in connection with such notice.
(iv)
The Management Committee shall issue or cause to be issued a written request to each Member for the making of Capital Contributions at such times and in such amounts as the Management Committee shall approve or as determined pursuant to Section 4.01(a)(iii) (such written request referred to herein as a “
Capital Call
”). Capital Contributions shall be made by the Members in accordance with their respective Sharing Ratio. Such Capital Contributions shall be made in cash, unless a Supermajority Interest elects to request non-cash Capital Contributions. All amounts timely received by the Company pursuant to this Section 4.01 shall be credited to the respective Member’s Capital Account as of such specified date.
(v)
Each Capital Call shall contain the following information:
(A)
The total amount of Capital Contributions requested from all Members;
(B)
The amount of Capital Contribution requested from the Member to whom the request is addressed, such amount to be in accordance with the Sharing Ratio of such Member;
(C)
The purpose for which the funds are to be applied in such reasonable detail as the Management Committee shall direct; and
(D)
The date on which payments of the Capital Contribution shall be made (which date shall not be less than 30 Days following the date the Capital Call is given, unless a sooner date is approved by the Management Committee) and the method of payment,
provided
that such date and method shall be the same for each of the Members.
(vi)
In the event the Management Committee fails to approve an Operating Budget within 30 Days of the submission of such Operating Budget to all of the Representatives on the Management Committee for approval, the Operator is authorized, subject to and in accordance with the COM Agreement, to issue a notice to the Company, pursuant to which the Company shall issue written requests to each Member for the making of Capital Contributions and/or loans required to fund the costs associated with such Operating Budget in an amount consistent with the Operating Budget most recently approved by the Management Committee and including costs that do not exceed, for any line item, [***] percent ([***]%) of the amount set forth for such line item in such most recently approved Operating Budget.
(k)
Each Member agrees that it shall make payments of its respective Capital Contributions in accordance with Capital Calls issued pursuant to this Section 4.01. Each Member shall deliver to the Company:
(i)
within [***] Business Days following the Management Committee’s approval of the Construction Budget, but in no event later than October 31, 2014 (or, with respect to a New Member admitted after such time and prior to the In-Service Date, within 10 Business Days of such admission), and for the period up to the issuance of FERC’s initial release to the Company to commence construction pursuant to the FERC Certificate (the “
Initial Release
”), performance assurances (“
Performance Assurances
”) equal to such Member’s share of $[***] (calculated based on such Member’s Sharing Ratio); and
(ii)
within ten (10) Business Days of the date of the Initial Release (or, with respect to a New Member admitted after the Initial Release, within ten (10) Business Days of such admission) for the period following the Initial Release and up to the In-Service Date, Performance Assurances equal to [***] percent ([***]%) of such Member’s remaining obligations to make Capital Contributions to the Company pursuant to this Article 4 (calculated based on such Member’s Sharing Ratio multiplied by the remaining obligations under the Construction Budget and net of any security posted by such Member, or Member’s Affiliate, under any Approved Precedent Agreement).
The Company shall be entitled to draw from the Performance Assurances in the event a Member fails to make payments of its respective Capital Contributions in accordance with Capital Calls issued pursuant to this Section 4.01. The Performance Assurances posted by a Member pursuant to this Section 4.01(b) shall be reduced (i) at the end of each Quarter, to reflect the [***] percent ([***]%) of such Member’s actual Capital Contributions made to the Company during such Quarter and (ii) in connection with a Disposition of all or a portion of such Member’s Membership Interest, to reflect the replacement Performance Assurances to be posted by the Assignee of such Membership Interest pursuant to this Section 4.01(b). Notwithstanding anything to the contrary in this Section 4.01(b), at no time prior to the In-Service Date will a Member’s Performance Assurance obligation be less than such Member’s share of $[***] (calculated based on a Member’s Sharing Ratio). Such Performance Assurances shall be permitted to be in the form of one or more of (A) a full and unconditional written guarantee from a Qualified Guarantor, (B) a Letter of Credit or (C) cash collateral (with the ability to substitute from time to time among (A), (B) or (C)). For the avoidance of doubt, a Member’s obligation to post Performance Assurances pursuant to this Section 4.01(b) shall expire (and any obligations under any posted Performance Assurances shall terminate) on the In-Service Date.
(l)
In addition to the authority granted the Management Committee in the other provisions of this Section 4.01 to issue Capital Calls, if within [***] Days prior to the date any Matured Financing Obligation is to become due (or within [***] Days after any notice of acceleration of any Matured Financing Obligation received prior to the maturity date thereof), (i) the Management Committee has not made a Capital Call for the payment of such amount that is (or is expected to be) a Matured Financing Obligation, and (ii) the Members have been unable to secure refinancing for such Matured Financing Obligation on reasonably acceptable terms after negotiating in good faith to do so with third-party lender(s), then at any time thereafter, (1) either EQT or USG may, on behalf of the Management Committee, issue a Capital Call for cash in the amount required for the payment of such Matured Financing Obligation, and each Member shall be obligated to pay such Capital Call as provided in this Section 4.01, but such payment shall be made within [***] Days after the date the Capital Call is given (and not the [***] Day period provided for in Section 4.01(a)(v)(D));
provided
that any failure by a Member to make a Capital Contribution with respect to a Capital Call made pursuant to this Section 4.01(c)(1) shall not constitute a Default under or breach of this Agreement; and (2) in the event any Member fails to make a Capital Contribution with respect to a Capital Call made pursuant to Section 4.01(c)(1), on or prior to such [***] Day, then each Founding Member shall have the right, but not the obligation, to pay the portion of the Capital Contribution owed and unpaid to permit the Company to discharge such Matured Financing Obligation. If any Founding Member elects to pay such Matured Financing Obligation pursuant to Section 4.01(c)(2), then such Founding Member will be deemed to be an Additional Contribution/Loan Member with respect to such payment, and its payment of the Matured Financing Obligation shall be treated, at the election of such Additional Contribution/Loan Member, as one of either: (A) a Capital Contribution or loan resulting in the Additional Contribution/Loan Members receiving [***] or (B) a permanent Capital Contribution that results in an adjustment of Membership Interests under Section 4.06(c).
|
|
4.09
|
Loans
.
(p)
If pursuant to Section 4.01(a)(iii) the Management Committee determines as to any individual Capital Call that all or a portion of such Capital Call shall be made by loans from the Members to the Company, then each Member shall make a loan to the Company at the time and in the amount and under such terms and conditions as the Management Committee shall approve by the affirmative vote of a Supermajority Interest.
|
(q)
If the Management Committee determines that the Company needs funds other than as contemplated by Section 4.02(a), then, rather than calling for Capital Contributions, the Management Committee may issue or cause to be issued a written request to each Member for the making of loans to the Company at such times, in such amounts and under such terms and conditions as the Management Committee shall approve by the affirmative vote of a Supermajority Interest;
provided
that the Management Committee shall not call for loans rather than Capital Contributions if doing so would breach any Financing Commitment or other agreement of the Company.
(r)
All amounts received from a Member after the date specified in Section 4.02(d)(iv) by the Company pursuant to this Section 4.02 shall be accompanied by interest on such overdue amounts (and the default shall not be cured unless such interest is also received by the Company), which interest shall be payable to the Company and shall accrue from and after such specified date at the Default Rate. Any such interest paid shall not be considered part of the principal of the loan.
(s)
Each written request issued pursuant to Section 4.02(a) or 4.02(b) shall contain the following information:
(i)
The total amount of loans requested from all Members;
(ii)
The amount of the loan requested from the Member to whom the request is addressed, such amount to be in accordance with the Sharing Ratio of such Member;
(iii)
The purpose for which the funds are to be applied in such reasonable detail as the Management Committee shall direct;
(iv)
The date on which the loans to the Company shall be made (which date shall not be less than [***] Days following the date the request is given, unless a sooner date is approved by the Management Committee) and the method of payment;
provided
that such date and method shall be the same for each of the Members; and
(v)
All terms concerning the repayment of or otherwise relating to such loans;
provided
that such terms shall be the same for each of the Members and in the case of costs covered by the Construction Budget shall be consistent with Section 4.01(a)(iii).
(t)
Each Member agrees that it shall make its respective loans in accordance with requests issued pursuant to this Section 4.02.
|
|
4.10
|
No Other Contribution or Loan Obligations
. No Member shall be required or permitted to make any Capital Contributions or loans to the Company except pursuant to this Article 4.
|
|
|
4.11
|
Return of Contributions
. Except as expressly provided herein, a Member is not entitled to the return of any part of its Capital Contributions or to be paid interest in respect of either its Capital Account or its Capital Contributions. An unreturned Capital Contribution is not a liability of the Company or of any Member. A Member is not required to contribute or to lend any cash or property to the Company to enable the Company to return any Member’s Capital Contributions.
|
|
|
4.12
|
Capital Accounts
.
(k)
A separate Capital Account shall be established and maintained for each Member with respect to such Member’s Membership Interest in the Company. Each Member’s Capital Account shall be increased by (i) the amount of money contributed by that Member to the Company; (ii) the fair market value of property contributed by that Member to the Company (net of liabilities secured by such contributed property that the Company is considered to assume or take subject to under Section 752 of the Code); (iii) allocations to that Member of income and gain (or items thereof), including items specifically allocated to such Member pursuant to Section 5.04(b) and income and gain exempt from tax and income and gain described in Treasury Regulation Section 1.704-1(b)(2)(iv)(g), but excluding income and gain described in Treasury Regulation Section 1.704-1(b)(4)(i); and (iv) the amount of any liabilities assumed by such Member and shall be decreased by (v) the amount of money distributed to that Member by the Company; (vi) the fair market value of property distributed to that Member by the Company (net of liabilities secured by such distributed property that such Member is considered to assume or take subject to under Section 752 of the Code); (vii) allocations to that Member of expenditures of the Company described (or treated as described) in Section 705(a)(2)(B) of the Code; (viii) allocations of loss and deduction (or items thereof), including items specifically allocated to such Member pursuant to Section 5.04(b) and loss and deduction described in Treasury Regulation Section 1.704-1(b)(2)(iv)(g), but excluding items described in (vi) above and loss or deduction described in Treasury Regulation Section 1.704-1(b)(4)(i) or 1.704-1(b)(4)(iii); and (ix) the amount of any liabilities of such Member assumed by the Company. The Members’ Capital Accounts shall also be maintained and adjusted as permitted by the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv)(f) and as required by the other provisions of Treasury Regulation Sections 1.704-1(b)(2)(iv) and 1.704-1(b)(4), including adjustments to reflect the allocations to the Members of depreciation, depletion, amortization, and gain or loss as computed for book purposes rather than the allocation of the corresponding items as computed for tax purposes, as required by Treasury Regulation Section 1.704-1(b)(2)(iv)(g). Thus, in the discretion of the Management Committee, the Members’ Capital Accounts shall be increased or decreased to reflect a revaluation of the property based on the fair market value of the property on the date of adjustment (as determined pursuant to Section 4.05(b)), immediately prior to (A) the contribution of more than a
de minimis
amount of money or other property to the Company by a new or existing Member as consideration for a Membership Interest or an increased Sharing Ratio, (B) the distribution of more than a
de minimis
amount of money or other property by the Company to a Member as consideration for a Membership Interest, or (C) the liquidation of the Company. A Member who has more than one Membership Interest shall have a single Capital Account that reflects all such Membership Interests, regardless of the class of Membership Interests owned by such Member and regardless of the time or manner in which such Membership Interests were acquired. Upon the Disposition of all or a portion of a Membership Interest, the Capital Account of the Disposing Member that is attributable to such Membership Interest shall carry over to the Assignee in accordance with the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv)(l). The Capital Accounts shall not be deemed to be, nor have the same meaning as, the capital account of the Company under the NGA.
|
(l)
Whenever the fair market value of property is required to be determined pursuant to the second and third sentences of Section 4.05(a), the Operator shall propose such a fair market value in a notice to the other Members. If any other Member disagrees with such determination, such Member shall notify the other Members of such disagreement within [***] Business Days of receiving such notice. If such Dispute is not resolved within [***] Business Days after such notice, any Member may submit such Dispute for binding appraisal in accordance with Section 13.11(c) by delivering a FMV Notice to the other Members.
This Section 4.05 is intended to comply with the capital account maintenance provisions of Treasury Regulations Section 1.704-1(b)(2)(iv) and will be applied and interpreted in accordance with such Treasury Regulations.
|
|
4.13
|
Failure to Make a Capital Contribution or Loan
.
|
(c)
General
. If any Member fails to make a Capital Contribution as requested by the Management Committee (or on behalf of the Management Committee pursuant to Section 4.01(c)) in a Capital Call validly and timely issued pursuant to Section 4.01 or a loan when required pursuant to Section 4.02(a) or 4.02(b) (each such Member being a “
Non
-
Contributing/Loan Member
”), and if such failure continues for more than [***] Days after the date on which it is due, the Members that have contributed their Capital Contribution or made their loan, as applicable (each, a “
Contributing/Loan Member
”) may (without limitation as to other remedies that may be available, and in particular such other remedies shall include the right to specifically enforce the obligation of the Non-Contributing/Loan Member to make the required Capital Contribution or loan) thereafter elect to:
(xix)
treat the Non-Contributing/Loan Member’s failure to contribute as a Default by giving notice thereof to the Non-Contributing/Loan Member, in which event the provisions of this Agreement regarding the commission of a Default by a Member shall apply (but if the Capital Call is for the payment of a Matured Financing Obligation, the Default shall be immediate on the giving of such notice and the [***]-Day cure period contemplated in the definition of Default shall not apply); or
(xx)
pay the portion of the Capital Contribution owed and unpaid by, or make the loan required from, the Non-Contributing/Loan Member (the “
Additional Contribution/Loan
”) in which event the Contributing/Loan Members that elect to fund the Non-Contributing/Loan Members’ share (the “
Additional Contribution/Loan Members
”) may treat the contribution or loan, as applicable as one of: (1) a Capital Contribution or loan, as applicable, resulting in the Additional Contribution/Loan Members receiving [***] under Section 4.06(b), or (2) a permanent Capital Contribution that results in an adjustment of Membership Interests under Section 4.06(c), as determined by the Additional Contribution/Loan Members as set forth below.
No Contributing/Loan Member shall be obligated to make either election under clause (i) or clause (ii) above. The decision of the Contributing/Loan Members to elect (i) or (ii) above shall be made by the determination of the Contributing/Loan Members holding the Supermajority Interest of all Contributing/Loan Members, but clause (ii) above may not be elected unless at such time of determination there is one or more Additional Contribution/Loan Members. The decision of the Additional Contribution/Loan Members to elect clause (ii)(1) or clause (ii)(2) above shall be made by the determination of the Additional Contribution/Loan Members holding the Supermajority Interest of all Additional Contribution/Loan Members. Unless and until such election is made, payment of the Additional Contribution/Loan shall be treated as a Priority Interest under Section 4.06(a)(ii) (1). [***].
(d)
[***]
(v)
[***]
(vi)
[***] shall not alter the Sharing Ratios of the Members, nor shall the [***] alter any distributions to the Contributing/Loan Members (in their capacity as Contributing/Loan Members, as opposed to their capacity as Additional Contribution/Loan Members) in accordance with their respective Sharing Ratios. Notwithstanding any provision in this Agreement to the contrary, a Member may not Dispose of all or a portion of [***] except to a Person to whom it Disposes all or the applicable
pro rata
portion of its Membership Interest after compliance with the requirements of this Agreement in connection therewith.
(vii)
For so long as any Additional Contribution/Loan Member holds [***], neither any Non-Contributing/Loan Member nor its Representative (except for a Non-Contributing/Loan Member that has paid to the Additional Contribution/Loan Member(s) all of the amount of the Additional Contribution/Loan attributable to such Non-Contributing/Loan Member in accordance with Section 4.06(b)(i)) shall have the right to vote its Membership Interest (or Sharing Ratio) under this Agreement with respect to any decision regarding distributions from the Company, and any distribution to which such Non-Contributing/Loan Member is entitled shall be paid to [***].
(viii)
No Member that is a Non-Contributing/Loan Member may Dispose of its Membership Interest unless, at the closing of such Disposition, either the Non-Contributing/Loan Member or the proposed Assignee pays [***]. No Assignee shall be admitted to the Company as a Member until compliance with this Section 4.06(b)(iv) has occurred.
(e)
Permanent Contribution
. If the Additional Contribution/Loan Members elect under Section 4.06(a)(ii) to have the Additional Contribution/Loan treated as a permanent Capital Contribution, then the Sharing Ratios of each Member will be automatically adjusted to equal each Member’s total Capital Contributions when expressed as a percentage of all Members’ Capital Contributions (after giving effect to the Capital Contribution made by the Additional Contribution/Loan Members).
(f)
Further Assurance
. In connection with this Section 4.06, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Section 4.06.
(g)
Deemed Non-Contributing/Loan Member
. Notwithstanding anything to the contrary, for purposes of this Agreement the term “Non-Contributing/Loan Member” shall include any Member who (i) fails to vote (through such Member’s Representatives) in favor of a proposed Capital Call under Section 4.01 or a proposed loan pursuant to Section 4.02 and (ii) fails to fund such Capital Call or loan, in each case, to the extent necessary to cover the amount of any Matured Financing Obligation that is to become due within [***] Days or that has become due (by acceleration or otherwise).
(g)
Unless otherwise agreed to by [***], if the Company is required to provide a guaranty, letter of credit or other credit support (each a “
Credit Assurance
”) to a counterparty under any contract or agreement (including an Approved Precedent Agreement) approved by the Management Committee of the Company prior to the In-Service Date (each a “
Subject Contract
”), then each Member agrees [***].
(h)
If a breach, default or other event occurs under a Subject Contract and the counterparty thereunder makes a demand or draw on one or more Credit Assurances for such breach, default or other event (an “
Demand Event
”), then a determination will be made as to the total dollar amount demanded or drawn by such counterparty for such Demand Event (“
Total Event Demand Amount
”). [***].
(i)
If any [***], then such Member [***].
Article 5
DISTRIBUTIONS AND ALLOCATIONS
|
|
5.08
|
Distributions
. Within [***] Days following the end of each Quarter following the In-Service Date, the Management Committee shall determine the amount of Available Cash with respect to such Quarter, and an amount equal to 100% of Available Cash with respect to such Quarter shall, subject to Section 18-607 of the Act, be distributed in accordance with this Article 5 to the Members (other than a Breaching Member) in proportion to their respective Sharing Ratios (at the time the amounts of such distributions are made);
provided
,
however
, that, if the Management Committee fails timely to determine the amount of Available Cash with respect to any Quarter following the In-Service Date, an amount equal to [***]% of the Available Cash determined with respect to the immediately preceding Quarter shall, subject to Section 18-607 of the Act, be distributed in accordance with this Article 5 to the Members (other than a Breaching Member) in proportion to their respective Sharing Ratios (at the time the amounts of such distributions are made).
|
|
|
5.09
|
[Intentionally omitted.]
|
|
|
5.10
|
[Intentionally omitted.]
|
|
|
5.11
|
Allocations for Maintaining Capital Accounts
.
(m)
For purposes of maintaining the Capital Accounts pursuant to Section 4.05, except as provided in Sections 5.04(b) and (c), each item of income, gain, loss, deduction and credit shall be allocated to the Members in accordance with their respective Sharing Ratios.
|
(n)
With respect to each period during which [***] with respect to an Additional Contribution/Loan treated as a Capital Contribution is outstanding, each Additional Contribution/Loan Member shall be allocated items of income and gain in an amount equal to the return that has accrued (whether or not paid) with respect to such Capital Contribution pursuant to Section 4.06(b)(i), and items of income and gain that would otherwise be allocable to the Non-Contributing/Loan Member(s) shall be correspondingly reduced.
(o)
Notwithstanding the foregoing provisions of Section 5.04, the following special allocations will be made:
(i)
[Intentionally omitted.]
(ii)
Nonrecourse Deductions shall be allocated to the Members in proportion to their Sharing Ratios.
(iii)
Member Nonrecourse Deductions attributable to Member Nonrecourse Debt shall be allocated to the Members bearing the Economic Risk of Loss for such Member Nonrecourse Debt as determined under Treasury Regulation Section 1.704-2(b)(4). If more than one Member bears the Economic Risk of Loss for such Member Nonrecourse Debt, the Member Nonrecourse Deductions attributable to such Member Nonrecourse Debt shall be allocated among the Members according to the ratio in which they bear the Economic Risk of Loss. This Section 5.04(c)(iii) is intended to comply with the provisions of Treasury Regulation Section 1.704-2(i) and shall be interpreted consistently therewith.
(iv)
Notwithstanding any other provision hereof to the contrary, if there is a net decrease in Minimum Gain for an allocation period (or if there was a net decrease in Minimum Gain for a prior allocation period and the Company did not have sufficient amounts of income and gain during prior periods to allocate among the Members under this Section 5.04(c)(iv), items of income and gain shall be allocated to each Member in an amount equal to such Member’s share of the net decrease in such Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(g)(2)). This Section 5.04(c)(iv) is intended to constitute a minimum gain chargeback under Treasury Regulation Section 1.704-2(f) and shall be interpreted consistently therewith.
(v)
Notwithstanding any provision hereof to the contrary except Section 5.04(c)(iv) (dealing with Minimum Gain), if there is a net decrease in Member Nonrecourse Debt Minimum Gain for an allocation period (or if there was a net decrease in Member Nonrecourse Debt Minimum Gain for a prior allocation period and the Company did not have sufficient amounts of income and gain during prior periods to allocate among the Members under this Section 5.04(c)(v)), items of income and gain shall be allocated to each Member in an amount equal to such Member’s share of the net decrease in Member Nonrecourse Debt Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(i)(4)). This Section 5.04(c)(v) is intended to constitute a partner nonrecourse debt minimum gain chargeback under Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith.
(vi)
Notwithstanding any provision hereof to the contrary except Section 5.04(c)(ii) and Section 5.04(c)(iii), no losses or other items of expense shall be allocated to any Member to the extent that such allocation would cause such Member to have a deficit Adjusted Capital Account balance (or increase any existing deficit Adjusted Capital Account balance) at the end of the allocation period. All losses and other items of expense in excess of the limitation set forth in this Section 5.04(c)(vi) shall be allocated to the Members who do not have a deficit Adjusted Capital Account balance in proportion to their relative positive Adjusted Capital Accounts but only to the extent that such losses and other items of expense do not cause any such Member to have a deficit Adjusted Capital Account balance.
(vii)
If any Member unexpectedly receives any adjustments, allocations or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6) resulting in or increasing an Adjusted Capital Account deficit for such Member, items of income and gain will be specially allocated to such Member in any amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, such Adjusted Capital Account deficit of the Member as quickly as possible;
provided
,
however
, that an allocation pursuant to this Section 5.04(c)(vii) shall be made only if and to the extent that such Member would have a deficit Adjusted Capital Account balance after all other allocations provided for in this Article 5 have been tentatively made as if this Section 5.04(c)(vii) were not in this Agreement. The items of income or gain to be allocated will be determined in accordance with Treasury Regulations Section 1.704-1(b)(2)(ii)(d). This subsection (vii) is intended to qualify and be construed as a “qualifying income offset” within the meaning of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and will be applied and interpreted in accordance with such Treasury Regulations.
|
|
5.12
|
Allocations for Tax Purposes
.
(h)
Except as provided in Section 5.05(b) and Section 5.05(c) or as otherwise required by the Code or Treasury Regulations, solely for federal income tax purposes, items of taxable income, gain, loss and deduction of the Company for each fiscal year or other relevant period shall be allocated among the Members in the same manner as each correlative item of “book” income, gain, loss and deduction is allocated to the Capital Accounts of the Members pursuant to Section 5.04 and each tax credit shall be allocated to the Members in the same manner as the receipt or expenditure giving rise to such credit is allocated pursuant to Section 5.04.
|
(i)
Income, gain, loss, and deduction with respect to property contributed to the Company by a Member or revalued pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(f) shall be allocated among the Members in a manner that takes into account the variation between the adjusted tax basis of such property and its book value, as required by Section 704(c) of the Code and Treasury Regulation Section 1.704-1(b)(4)(i), using the remedial allocation method permitted by Treasury Regulation Section 1.704-3(d).
(j)
Pursuant to Treasury Regulations Section 1.1245-1(e), to the extent the Company recognizes gain as a result of a sale, exchange or other disposition of Company assets which is taxable as recapture income under Sections 1245 or 1250 of the Code or unrecaptured Section 1250 gain under Section 1(h) of the Code, such recapture income shall be allocated among the Members in the same proportion as the depreciation and amortization giving rise to such recapture income was allocable among the Members. In no event, however, shall any Member be allocated recapture income hereunder in excess of the amount of gain allocated to the Member under this Agreement. Any recapture income that is not allocated to a Member due to the gain limitation described in the previous sentence shall be allocated among those Members whose shares of total gain on the sale, exchange or other disposition of the property exceed their share of depreciation and amortization attributable to Company assets, in proportion to their relative shares of the total allocable gain.
(k)
Allocations pursuant to this Section 5.05 are solely for federal (and, where applicable, state and local) tax purposes and shall not affect, or in any way be taken into account in computing, any Capital Account or share of income, gain, loss and other deduction described in Section 5.04 or distributions pursuant to any provision of this Agreement.
(l)
The Members are aware of the income and other tax consequences of the allocations made by this Agreement and hereby agree to be bound by the provisions of this Agreement in reporting their shares of items of income, gain, loss, credit and deduction.
|
|
5.13
|
Varying Interests
. All items of income, gain, loss, deduction or credit shall be allocated, and all distributions shall be made, to the Persons shown on the records of the Company to have been Members as of the last Day of the period for which the allocation or distribution is to be made. Notwithstanding the foregoing, if during any taxable year there is a change in any Member’s Sharing Ratio, the Members agree that their allocable shares of such items for the taxable year shall be determined based on any method determined by the Management Committee to be permissible under Code Section 706 and the related Treasury Regulations to take account of the Members’ varying Sharing Ratios.
|
|
|
5.14
|
Amounts Withheld
. The Company is authorized to withhold from payments and distributions to the Members and to pay over to any federal, state or local Governmental Authority any amounts required to be so withheld pursuant to the Code or any provisions of any applicable Law and shall allocate such amounts to the Members with respect to which such amounts were withheld. All amounts withheld pursuant to the Code or any provisions of any applicable Law with respect to any payment, distribution or allocation shall be treated for all purposes under this Agreement as amounts paid or distributed pursuant to this Article 5 to the Members with respect to which such amount was withheld. All taxes paid on behalf of such Member pursuant to this Section 5.07 in excess of any distributions otherwise payable to such Member shall, at the option of the Company, (i) be promptly paid to the Company by such Member or (ii) be repaid by reducing the amount of the current or next succeeding distribution or distributions which would otherwise have been made to such Member or, if such distributions are not sufficient for that purpose, by so reducing the proceeds of liquidation otherwise payable to such Member. Whenever the Company selects option (ii) of the preceding sentence, such Member shall for all purposes of this Agreement be treated as having received a distribution under 5.01 of the amount of the tax payment. To the fullest extent permitted by law, each Member hereby agrees to indemnify and hold harmless the Company and the other Members from and against any liability for taxes (and related interest, penalties or additions to tax) with respect to income attributable to or distributions or other payments to such Member.
|
Article 6
MANAGEMENT
|
|
6.10
|
Generally
. Except as provided in Section 6.05(a), the management of the Company is fully vested in the Founding Members. To facilitate the orderly and efficient management of the Company, the Founding Members shall act (a) collectively as a “committee of the whole” pursuant to Section 6.02, and (b) through the delegation of certain duties and authority to the Operator. Subject to the express provisions of this Agreement, each Member agrees that it will not exercise its authority under the Act to bind or commit the Company to agreements, transactions or other arrangements, or to hold itself out as an agent of the Company.
|
|
|
6.11
|
Management Committee
. The Founding Members shall act collectively through meetings as a “committee of the whole,” which is hereby named the “
Management Committee
.” Decisions or actions taken by the Management Committee in accordance with the provisions of this Agreement shall constitute decisions or actions by the Company and shall be binding on each Member, Representative, and employee of the Company. The Management Committee shall conduct its affairs in accordance with the following provisions and the other provisions of this Agreement:
|
(i)
Designation
. To facilitate the orderly and efficient conduct of Management Committee meetings, each Founding Member (together with its Affiliates who are also Founding Members, if any) shall notify the other Founding Member(s), from time to time, of the identity of (A) one of its senior officers, who will represent it at such meetings (a “
Representative
”), and (B) at least one, but not more than two, additional senior officers, who will represent it at any meeting that the Founding Member’s Representative is unable to attend (each an “
Alternate Representative
”). (The term “
Representative
” shall also refer to any Alternate Representative that is actually performing the duties of the applicable Representative.) [***]. The initial Representative and Alternate Representatives of each Founding Member are set forth in
Exhibit A
. A Founding Member may designate a different Representative or Alternate Representatives for any meeting of the Management Committee by notifying the other Founding Member(s) at least [***] Business Days prior to the scheduled date for such meeting;
provided
that, if giving such advance notice is not feasible, then such new Representative or Alternate Representatives shall present written evidence of his or her authority at the commencement of such meeting.
(ii)
Authority
.
Each Representative shall have the full authority to act on behalf of the Founding Member that designated such Representative; the action of a Representative at a meeting (or through a written consent) of the Management Committee shall bind the Founding Member that designated such Representative; and the other Members shall be entitled to rely upon such action without further inquiry or investigation as to the actual authority (or lack thereof) of such Representative. In addition, the act of an Alternate Representative shall be deemed the act of the Representative for which such Alternate Representative is acting, without the need to produce evidence of the absence or unavailability of such Representative.
(iii)
DISCLAIMER OF DUTIES; INDEMNIFICATION
.
EACH REPRESENTATIVE SHALL REPRESENT, AND OWE DUTIES TO, ONLY THE MEMBER THAT DESIGNATED SUCH REPRESENTATIVE (THE NATURE AND EXTENT OF SUCH DUTIES BEING AN INTERNAL AFFAIR OF SUCH MEMBER), AND SHALL NOT OWE ANY DUTIES (INCLUDING FIDUCIARY DUTIES) TO THE COMPANY, ANY OTHER MEMBER OR REPRESENTATIVE, OR ANY AFFILIATE, OFFICER, OR EMPLOYEE OF THE COMPANY, ANY OTHER MEMBER, OR ANY OTHER PERSON. THE PROVISIONS OF SECTIONS 6.02(f)(ii) AND 6.04 SHALL ALSO INURE TO THE BENEFIT OF EACH MEMBER’S REPRESENTATIVE. THE COMPANY SHALL INDEMNIFY, PROTECT, DEFEND, RELEASE AND HOLD HARMLESS EACH REPRESENTATIVE FROM AND AGAINST ANY CLAIMS ASSERTED BY OR ON BEHALF OF ANY PERSON (INCLUDING ANOTHER MEMBER), OTHER THAN THE MEMBER THAT DESIGNATED SUCH REPRESENTATIVE, THAT ARISE OUT OF, RELATE TO, OR ARE OTHERWISE ATTRIBUTABLE TO, DIRECTLY OR INDIRECTLY, THE COMPANY OR SUCH REPRESENTATIVE’S SERVICE ON THE MANAGEMENT COMMITTEE.
(iv)
Attendance
.
Each Founding Member shall use all reasonable efforts to cause its Representative or Alternate Representative to attend each meeting of the Management Committee, unless its Representative is unable to do so because of a “force majeure” event or other event beyond his reasonable control, in which event such Founding Member shall use all reasonable efforts to cause its Representative or Alternate Representative to participate in the meeting by telephone pursuant to Section 6.02(h).
(n)
Secretary
. The Management Committee may designate a Secretary of the Management Committee, who need not be a Representative or an employee of a Member or any Affiliate thereof.
(o)
Procedures
. The Secretary, or if no Secretary has been appointed, a person designated in writing by the Representatives, of the Management Committee shall maintain written minutes of each meeting held by the Management Committee. The Management Committee may adopt whatever rules and procedures relating to its activities as it may deem appropriate,
provided
that such rules and procedures shall not be inconsistent with or violate the provisions of this Agreement.
(p)
Time and Place of Meetings
. The Management Committee shall meet quarterly, subject to more or less frequent meetings upon approval of the Management Committee. Notice of, and an agenda for, all Management Committee meetings shall be provided by the Representatives to all Members at least five Days prior to the date of each meeting, together with proposed minutes of the previous Management Committee meeting (if such minutes have not been previously ratified). Among other items, the agenda will provide for a discussion of (i) the results of operations, including explanations of significant variances in revenues, expenses and cash flow activities and (ii) amounts due for contractual obligations that will impact Available Cash. Special meetings of the Management Committee may be called at such times, and in such manner, as any Founding Member reasonably deems necessary. Any Founding Member calling for any such special meeting shall notify the Representatives, who in turn shall notify all Founding Members of the date and agenda for such meeting at least five Days prior to the date of such meeting. Such five-Day period may be shortened by the Management Committee, acting through Supermajority Interest. All meetings of the Management Committee shall be held at a location agreed upon by the Representatives. Attendance of a Representative of a Founding Member at a meeting of the Management Committee shall constitute a waiver of notice of such meeting, except where such Representative attends the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.
(q)
Quorum
. The presence of Representative(s) of Founding Members representing Supermajority Interest shall constitute a quorum for the transaction of business at any meeting of the Management Committee.
(i)
Voting by Sharing Ratios
. Subject to Sections 6.02(j), 6.05(a), and 6.05(e), each Representative shall be entitled to vote on all matters submitted to a vote of the Management Committee in accordance with the respective Sharing Ratio of the Founding Member that designated such Representative.
(ii)
DISCLAIMER OF DUTIES
.
WITH RESPECT TO ANY VOTE, CONSENT OR APPROVAL AT ANY MEETING OF THE MANAGEMENT COMMITTEE OR OTHERWISE UNDER THIS AGREEMENT, EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED IN SECTION 6.02(j) AND SECTION 6.05(e) OF THIS AGREEMENT, EACH REPRESENTATIVE MAY GRANT OR WITHHOLD SUCH VOTE, CONSENT OR APPROVAL (A) IN ITS SOLE AND ABSOLUTE DISCRETION, (B) WITH OR WITHOUT CAUSE, (C) SUBJECT TO SUCH CONDITIONS AS IT SHALL DEEM APPROPRIATE, AND (D) WITHOUT TAKING INTO ACCOUNT THE INTERESTS OF, AND WITHOUT INCURRING LIABILITY TO, THE COMPANY, ANY OTHER MEMBER OR REPRESENTATIVE, OR ANY AFFILIATE, OFFICER, OR EMPLOYEE OF THE COMPANY OR ANY OTHER MEMBER (COLLECTIVELY, “
SOLE DISCRETION
”). THE PROVISIONS OF THIS SECTION 6.02(f)(ii) SHALL APPLY NOTWITHSTANDING THE NEGLIGENCE, GROSS NEGLIGENCE, WILLFUL MISCONDUCT, STRICT LIABILITY OR OTHER FAULT OR RESPONSIBILITY OF A MEMBER OR ITS REPRESENTATIVE.
(iii)
Exclusion of Certain Members and Their Sharing Ratios
.
With respect to any vote, consent or approval, any Breaching Member or Withdrawn Member (and any Representative of such Breaching Member or Withdrawn Member) shall be excluded from such decision (as contemplated by Section 10.03(b)), and the Sharing Ratio of such Breaching Member or Withdrawn Member shall be disregarded in calculating the voting thresholds in Section 6.02(f)(i). In addition, if any other provision of this Agreement provides that a Supermajority Interest is to be calculated without reference to the Sharing Ratio of a particular Founding Member, then the applicable voting threshold shall be deemed adjusted accordingly.
(s)
Action by Written Consent
. Any action required or permitted to be taken at a meeting of the Management Committee may be taken without a meeting, without prior notice, and without a vote if a consent or consents in writing, setting forth the action so taken, is signed by the Representatives that could have taken the action at a meeting of the Management Committee.
(t)
Meetings by Telephone
. Representatives may participate in and hold such meeting by means of conference telephone, videoconference or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in such a meeting shall constitute presence in person at such meeting, except where a Representative participates in the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.
(u)
Matters Requiring Approval of the Management Committee
. Notwithstanding any other provision of this Agreement, but subject to Section 6.05(e), none of the following actions may be taken by, or on behalf of, the Company without first obtaining the approval of a Supermajority Interest of the Management Committee:
(A)
conducting any activity or business that, in the reasonable judgment of the Operator acting in good faith, may generate income for federal income tax purposes that may not be “qualifying income” (as such term is defined pursuant to Section 7704 of the Code) in excess of [***]% of the gross income of the Company;
(B)
any material tax elections or any material decisions relating to material tax returns, in each case, as determined in the reasonable judgment of the Operator acting in good faith;
(C)
considering at a meeting of the Management Committee a material matter not on the agenda for that meeting;
(D)
entering into, amending in any material respect, or terminating any Material Contract, or taking any action that results in a material default under any Material Contract;
(E)
approving any material loans made by the Company or the provision of any material financial guarantees by the Company, except to the extent such material loans or material financial guarantees have been specifically included in and approved as part of the Construction Budget, the Initial Operating Budget, or any subsequent annual Capital Budget or Operating Budget that has been approved by the Management Committee;
(F)
placing or permitting any liens or other encumbrances (other than Permitted Encumbrances) to exist on the assets of the Company;
(G)
[***]
(H)
[***]
(I)
[***]
(J)
[***]
(K)
[***]
(L)
except as otherwise provided in Section 4.01(a)(ii) making a Capital Call or otherwise requiring any Member to make any Capital Contribution, except to the extent such Capital Call or Capital Contribution has been specifically included in and approved as part of the Construction Budget, the Initial Operating Budget, or any subsequent annual Capital Budget or Operating Budget that has been approved by the Management Committee;
(M)
[***]
(N)
selecting a different name for the Company, or making any change to the principal nature of the business of the Company;
(O)
[***]
(P)
[***]
(Q)
approving accounting procedures for the Company in accordance with GAAP, or voluntarily changing or terminating the appointment of the Company’s accountants;
(R)
[***]
(S)
[***]
(T)
[***]
(U)
[***]
(V)
on the occurrence of a Dissolution Event, the designation of a Member or other Person to serve as liquidator pursuant to Section 12.02;
(W)
the commencement, conduct or settlement of any suit, action or proceeding or arbitration, each involving in excess of $[***];
(X)
the formation of any subcommittee of the Management Committee pursuant to Section 6.02(k);
(Y)
dissolution of the Company pursuant to Section 12.01;
(Z)
causing or permitting the Company to become Bankrupt (but this provision shall not be construed to require any Member to ensure the profitability or solvency of the Company);
(AA)
the Disposition or abandonment of all or substantially all of the Company’s assets, or of the Company’s material assets other than any Disposition(s) in the ordinary course of business;
(BB)
causing or permitting the Company to merge, consolidate or convert into any other entity;
(CC)
[***]
(DD)
approving the FERC Application pursuant to Section 7.01(a);
(EE)
making any decision required pursuant to Sections 7.01(b), (c) or (d);
(FF)
[***]
(GG)
[***]
(HH)
[***]
(v)
Reasonableness
. In any matter proposed to the Management Committee pursuant to [***].
(w)
Subcommittees
. The Management Committee may create such subcommittees, and delegate to such subcommittees such authority and responsibility, and rescind any such delegations, as it may deem appropriate.
(x)
Officers
. The Management Committee may designate one or more Persons to be officers of the Company. Any officers so designated shall have such titles and, subject to the other provisions of this Agreement, have such authority and perform such duties as the Management Committee may delegate to them and shall serve at the pleasure of the Management Committee and report to the Management Committee.
|
|
6.12
|
Construction, Operation and Management Agreement
. The Company shall enter into a Construction, Operation and Management Agreement with Operator (the “
COM Agreement
”) in such form as shall be approved by the Founding Members.
|
|
|
6.13
|
No Duties; Disclaimer of Duties
. Each Member acknowledges its express intent, and agrees with each other Member for the mutual benefit of all the Members, that
|
(a)
to the fullest extent permitted by applicable Law, no Member, in its capacity as Member, nor any of such Member’s or any of its Affiliates’ respective employees, agents, directors, managers or officers shall have any fiduciary duty to the Company, any other Member or Representative or any other Person in connection with the business and affairs of the Company or any consent or approval given or withheld pursuant to this Agreement;
provided
,
however
, that nothing herein shall eliminate the implied contractual covenant of good faith and fair dealing;
(b)
to the fullest extent permitted by applicable Law, no Representative, in such Person’s capacity as a Representative, shall have any fiduciary duty to the Company, any Member (other than the Member that designated such Representative), any other Representative, or any other Person in connection with the business and affairs of the Company or any consent or approval given or withheld pursuant to this Agreement;
provided
,
however
, that nothing herein shall eliminate the implied contractual covenant of good faith and fair dealing; and
(c)
the provisions of this Section 6.04 will apply for the benefit of each Member, and no standard of care, duty, or other legal restriction or theory of liability shall limit or modify the right of each Member to act and direct its Representative to vote in the manner determined by the Member that designated such Representative in its Sole Discretion.
To the maximum extent permitted by applicable Law, each Member hereby releases and forever discharges each other Member and such other Member’s Representative from all liabilities that such other Member or its Representative might owe, under the Act or otherwise, to the Company, the releasing Member, or such releasing Member’s Representative on the ground that any decision of that other Member or such other Member’s Representative to grant or withhold any vote, consent or approval constituted the breach or violation of any standard of care, any fiduciary duty or other legal restriction or theory of liability applicable to such other Member or its Representative;
provided
,
however
, that nothing herein shall eliminate any Member’s liability for any act or omission that constitutes a bad faith violation of the implied contractual covenant of good faith and fair dealing. Notwithstanding anything in this Agreement to the contrary, nothing in this Section 6.04 shall limit or waive any claims against, actions, rights to sue, other remedies or other recourse of the Company, any Member or any other Person may have against any Member, Representative or employee of the Company for a breach of contract claim relating to any binding agreement.
|
|
6.14
|
Business Opportunities
.
|
(a)
During the Term, except as otherwise provided in Section 6.05(f), any project involving the planning, design, construction, acquisition, ownership, maintenance, or operation of the Facilities may be conducted only by the Company and not by any Member or any Affiliate of a Member.
(b)
A Member and each Affiliate of a Member may engage in and possess interests in other business ventures of any and every type and description, independently or with others, including ones in competition with the Company, with no obligation to offer to the Company, any other Member or any Affiliate of another Member the right to participate therein. Subject to Section 6.02(i)(HH), the Company may transact business with any Member or Affiliate thereof. Without limiting the generality of the foregoing, the Members recognize and agree that their respective Affiliates currently engage in certain activities involving natural gas and electricity marketing and trading (including futures, options, swaps, exchanges of future positions for physical deliveries and commodity trading), gathering, processing, storage, transportation and distribution, electric generation, development and ownership, as well as other commercial activities related to natural gas and that these and other activities by Members’ Affiliates may be based on natural gas that is shipped through the Facilities or otherwise made possible or facilitated by reason of the Company’s activities (herein referred to as “
Affiliate
’
s Outside Activities
”). No Affiliate of a Member shall be restricted in its right to conduct, individually or jointly with others, for its own account any Affiliate’s Outside Activities, and no Member or its Affiliates shall have any duty or obligation, express or implied, fiduciary or otherwise, to account to, or to share the results or profits of such Affiliate’s Outside Activities with, the Company, any other Member or any Affiliate of any other Member, by reason of such Affiliate’s Outside Activities. The provisions of this Section 6.05(b) and Sections 6.02(a)(iii), 6.02(f)(ii), 6.04, 6.05(d), 6.05(e), and 6.07(a) constitute an agreement to modify or eliminate, as applicable, fiduciary duties pursuant to the provisions of Section 18-1101 of the Act.
|
|
(c)
|
Subject to Section 6.05(a), each Member:
|
(iii)
renounces in advance each and every interest or expectancy it or any of its Affiliates might be considered to have under the Act, at common law or in equity by reason of its membership in the Company in any business opportunity, or in any opportunity to participate in any business opportunity, in any business or industry in which any other Member or its Affiliates now or in the future engages, which is presented to the Company, to any other Member or any of its Affiliates or to any present or future partner, member, director, officer, manager, supervisor, employee, agent or representative of the Company or of any other Member or any of its Affiliates; and
(iv)
waives and consents to [***].
|
|
(d)
|
Subject to Section 6.05(a), the Company:
|
(i)
renounces in advance each and every interest or expectancy it might be considered to have under the Act, at common law or in any business opportunity, or in any opportunity to participate in any business opportunity, in any business or industry in which any Member or any of its Affiliates now or in the future engages, which is presented to such Member or any of its Affiliates or to any present or future partner, member, director, officer, manager, supervisor, employee, agent or representative of such Member or any of its Affiliates; and
(ii)
waives and consents to [***].
(e)
Notwithstanding any other provision in this Agreement, with respect to a Related Party Matter, the Representative of the Founding Member who is, or whose Affiliate is, involved in such Related Party Matter [***].
(f)
[***]
|
|
6.15
|
Insurance Coverage
.
|
(a)
Operator Insurance
. Pursuant to the COM Agreement, the Operator is required to carry and maintain or cause to be carried and maintained certain liability insurance coverages.
(b)
Owner Insurance
. The Management Committee shall determine the type limits, deductibles and other terms applicable to the insurance coverages to be maintained by the Company, and the Company shall engage an insurance broker to provide recommendations and to procure such insurance coverages on behalf of the Company.
(c)
Claim for Property Loss or Damage
. In the event of actual loss or damage to the Company’s property or any incident reasonably anticipated to give rise to a claim for loss or damage to the Company’s property, the Company shall promptly provide written notice to the Members of such loss, damage or incident. The Company shall take all actions necessary to provide proper and timely notification to its insurers of such loss, damage or incident. The Company shall be responsible for the preparation, submittal and negotiation of all insurance claims related to any loss, damage or incident involving the Company’s property. The Members each agree to use all reasonable efforts to cooperate with each other and the Company in the preparation, submittal and negotiation of all such claims by the Company, including, but not limited to, the assignment of adjusters and the provision and exchange of information related to any loss, damage or incident involving the Company’s property.
(d)
Directors’ and Officers’ Liability
. Each Member shall carry and maintain Directors’ and Officers’ Liability insurance covering its own respective persons who are serving as officers, directors, Representatives or Management Committee members. Each Member shall also be responsible for insuring its respective Membership Interest for securities claims against the Company.
(a)
Subject to Section 6.07(b), to the fullest extent permitted by the Act, the Company shall indemnify and hold harmless each Representative and each Member and the managers, officers, directors, stockholders, partners, members, managers, employees, affiliates, representatives and agents of such Member, as well as each officer, employee, representative, and agent of the Company (individually, a “
Covered Person
”) from and against any and all Claims in which the Covered Person may be involved, or threatened to be involved, as a party or otherwise, by reason of the fact that he or it is a Covered Person or which relates to or arises out of the Company or its property, business or affairs. A Covered Person shall not be entitled to indemnification under this Section 6.07(a) with respect to [***].
(b)
Notwithstanding the obligations of the Company pursuant to Section 6.07(a) and subject to Section 6.08, each Member shall indemnify, protect, defend, release and hold harmless the Company and each other Member, its Representative, its Affiliates, and its and their respective directors, officers, trustees, employees and agents from and against [***].
|
|
6.17
|
Limitation on Liability
. EXCEPT IN CONNECTION WITH INDEMNIFICATION OBLIGATIONS ARISING FROM AN ACTION OR PROCEEDING BROUGHT BY A THIRD PARTY FOR AMOUNTS PAID OR OWING TO SUCH THIRD PARTY, EACH MEMBER AGREES THAT NO MEMBER SHALL BE LIABLE UNDER THIS AGREEMENT FOR EXEMPLARY, INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES WHICH IN ANY WAY ARISE OUT OF, RELATE TO, OR ARE A CONSEQUENCE OF, ITS PERFORMANCE OR NONPERFORMANCE HEREUNDER, OR THE PROVISION OF OR FAILURE TO PROVIDE ANY SERVICE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, LOSS OF FUTURE PROFITS, BUSINESS INTERRUPTIONS, AND LOSS OF CUSTOMERS, WHETHER SUCH DAMAGES ARE ASSERTED IN AN ACTION BROUGHT IN CONTRACT, IN TORT OR PURSUANT TO SOME OTHER THEORY, AND WHETHER THE POSSIBILITY OF SUCH DAMAGES WAS MADE KNOWN OR WAS FORESEEABLE.
|
|
|
6.18
|
Delivery of Operating Budget
.
On or prior to [***] of each year, the Operator shall deliver a draft annual Operating Budget for the following year to each of the Representatives, which Representatives will have [***] Days to provide comments (the “
Comment Deadline
”) on such draft annual Operating Budget (such comments, the “
Representative Budget Comments
”). The Operator shall make a good faith effort to respond to, and incorporate into such draft annual Operating Budget, the Representative Budget Comments and shall deliver to each of the Representatives the final annual Operating Budget for the following year on or before [***] (the “
December Deadline
”) of each year;
provided
,
however
, that, if the board of directors of the Operator has not convened to approve the annual Operating Budget by [***] of a given year, then the December Deadline shall be extended to [***] of such year;
provided
,
further
, that, if the meeting of the board of directors of the Operator to approve the annual Operating Budget is scheduled prior to the Comment Deadline, the Operator shall promptly notify the Representatives in writing of the date and time of such meeting (but no less than [***] Business Days in advance of such meeting), and the Representatives shall use reasonable efforts to provide the Representative Budget Comments in advance of such meeting. The Operator and the Representatives shall work together in good faith to cause the Operating Budget to be approved by [***] of such year.
|
Article 7
DEVELOPMENT OF FACILITIES
|
|
7.04
|
Development of Facilities
.
|
(v)
FERC Application
. Pursuant to the terms of the COM Agreement, USG, EQT, and the Operator shall jointly prepare and submit to the Management Committee the proposed FERC Application related to the Facilities; and, following the approval of the FERC Application by the Management Committee, USG, EQT, and the Operator shall, on behalf of the Company, file the FERC Application with the FERC.
(w)
Approval of FERC Certificate
. No later than [***] Days prior to the FERC Response Date, the Management Committee shall vote on whether the FERC Certificate for the Facilities is issued on terms and conditions which are not materially different from those requested in the FERC Application for the Facilities and whether the Company shall (i) accept the FERC Certificate for the Facilities without seeking rehearing; (ii) accept the FERC Certificate and seek rehearing of the order issuing the FERC Certificate; (iii) file for rehearing before committing to accept or reject the FERC Certificate; or (iv) reject the FERC Certificate. The Management Committee shall be deemed to have approved the FERC Certificate for the Facilities if the Management Committee determines that such certificate is issued on terms and conditions which are not materially different from those requested in the FERC Application for the Facilities. In such event the Management Committee shall accept the FERC Certificate prior to the FERC Response Date with or without seeking rehearing of the order issuing the FERC Certificate for the Facilities. In such event, subject to the terms of this Agreement, each Member shall be firmly committed to the construction of the Facilities and the construction of the Facilities shall not be subject to any conditions precedent, including but not limited to Management Committee approval of any financial commitment for obtaining funds to finance the Facilities or the Management Committee approval to construct the Facilities.
(x)
If the Management Committee finds that the FERC Certificate for the Facilities is issued on terms and conditions which are materially different from those requested in the FERC Application and EQT and USG vote to accept the order issuing the FERC Certificate with or without seeking rehearing, then the Management Committee and the Company shall accept the FERC Certificate prior to the FERC Response Dates, and in such event, and subject to the terms of this Agreement, each Member shall be firmly committed to the construction of the Facilities and the construction of the Facilities shall not be subject to any conditions precedent as provided in Section 7.01(b).
(y)
If the Management Committee finds that the FERC Certificate for the Facilities is issued on terms and conditions which are materially different from those requested in the FERC Application for the Facilities and [***]. In the event no Member votes to accept the order issuing the FERC Certificate for the Facilities, then such vote shall be a Dissolution Event and the Company shall dissolve and its offices shall be wound up pursuant to Article 12.
|
|
7.05
|
Employee Matters
. To facilitate placing the Facilities in service, a Founding Member that is not, or does not have an Affiliate that is, the Operator shall have the right to have one (1) employee located in the Operator’s primary place of business with respect to the Facilities and any construction or engineering site until the In-Service Date for such Facilities, and such employee shall have access to all construction and engineering offices related to the Facilities and shall be permitted to review, examine, and copy the books, records, plans, reports, forecasts, studies, budgets, and other information related to such Facilities.
|
|
|
7.06
|
General Regulatory Matters
.
|
(u)
The Members acknowledge that either the Company will be a “natural gas company” as defined in Section 2(6) of the NGA or the assets of the Company will be operated by a “natural gas company” as defined in Section 2(6) of the NGA in accordance with the certificate of authority granted by the FERC.
(v)
Each Member shall (i) cooperate fully with the Company, the Management Committee, USG, EQT, and the Operator in securing the Necessary Regulatory Approvals, including supporting all FERC Applications, and in connection with any reports prescribed by the FERC and any other Governmental Authority having jurisdiction over the Company; (ii) join in any eminent domain takings by the Company, to the extent, if any, required by Law; and (iii) without limiting or modifying Section 6.04 or 6.05, devote such efforts as shall be reasonable and necessary to develop and promote the Facilities for the benefit of the Company, taking into account such Member’s Sharing Ratio, resources, and expertise.
Article 8
TAXES
|
|
8.04
|
Tax Returns
. Operator shall prepare and timely file (on behalf of the Company) all federal, state and local tax returns required to be filed by the Company;
provided
that so long as USG is a Founding Member to which a material tax return relates, USG shall have the right to review and comment on such material return at least 25 Days prior to the relevant due date for such return (which return may be provided to USG in draft form) and that the Operator shall include any such timely received comments as are reasonable, subject to applicable Law and to any ethical obligations of a return preparer. Each Member shall furnish to Operator all pertinent information in its possession relating to the Company’s operations that is necessary to enable the Company’s tax returns to be timely prepared and filed. The Company shall bear the costs of the preparation and filing of its returns.
|
|
|
8.05
|
Tax Elections
. The Company shall make the following elections on the appropriate tax returns:
|
|
|
(w)
|
to adopt the calendar year as the Company’s fiscal and taxable year;
|
|
|
(x)
|
to adopt the accrual method of accounting;
|
|
|
(y)
|
to make the election described in Code Section 754 with respect to the first taxable year of the Company;
|
|
|
(z)
|
to elect to deduct or amortize the organizational expenses of the Company in accordance with Section 709(b) of the Code and to depreciate property pursuant to the most rapid depreciation or cost recovery method available; and
|
|
|
(aa)
|
any other election the Management Committee may deem appropriate or that the Operator is permitted to make without Management Committee approval in accordance with Section 6.02(i)(B).
|
Notwithstanding the foregoing, however, neither the Company nor any Member shall make an election for the Company to be excluded from the application of the provisions of subchapter K of chapter 1 of subtitle A of the Code or elect for the Company to be treated as an association taxable as a corporation or any similar provisions of applicable state law and no provision of this Agreement shall be construed to sanction or approve such an election.
|
|
8.06
|
Tax Matters Member
.
(h)
EQT shall serve as the “tax matters partner” of the Company pursuant to Section 6231(a)(7) of the Code (the “
Tax Matters Member
”). The Tax Matters Member shall take such action as may be necessary to cause to the extent possible each other Member to become a “notice partner” within the meaning of Section 6223 of the Code. The Tax Matters Member shall inform each other Member of all significant matters that may come to its attention in its capacity as Tax Matters Member by giving notice thereof on or before the fifth Business Day after becoming aware thereof and, within that time, shall forward to each other Member copies of all significant written communications it may receive from a taxing authority in that capacity. In the event that EQT ceases to be the Tax Matters Member (or any successor Tax Matters Member ceases to be a Member), the Management Committee shall appoint a successor Tax Matters Member.
|
(i)
The Tax Matters Member shall provide any Member, upon reasonable request, access to accounting and tax information and schedules obtained by the Tax Matters Member solely in its capacity as Tax Matters Member as shall be necessary for the preparation by such Member of its income tax returns and such Member’s tax information reporting requirements.
(j)
The Tax Matters Member shall take no action in its capacity as Tax Matters Member without the authorization of the Management Committee, other than such action as may be required by Law. Any cost or expense incurred by the Tax Matters Member in connection with its duties, including the preparation for or pursuance of administrative or judicial proceedings and in complying with Section 8.03(b), shall be paid by the Company.
(k)
The Tax Matters Member shall not enter into any extension of the period of limitations for making assessments on behalf of the Members without first obtaining the consent of the Management Committee. The Tax Matters Member shall not bind any Member to a settlement agreement without obtaining the consent of such Member. Any Member that enters into a settlement agreement with respect to any partnership item (as described in Code Section 6231(a)(3)) with respect to the Company shall notify the other Members of such settlement agreement and its terms within [***] Days from the date of the settlement.
(l)
No Member shall file a request pursuant to Code Section 6227 for an administrative adjustment of Company items for any taxable year without first notifying the other Members no later than [***] Days prior to filing such request. If the Management Committee consents to the requested adjustment, the Tax Matters Member shall file the request for the administrative adjustment on behalf of the Members. If such consent is not obtained within [***] Days from such notice, any Member, including the Tax Matters Member, may file a request for administrative adjustment on its own behalf. Any Member intending to file a petition under Code Sections 6226, 6228 or other Code Section with respect to any item involving the Company shall notify the other Members of such intention and the nature of the contemplated proceeding. In the case where the Tax Matters Member is the Member intending to file such petition on behalf of the Company, such notice shall be given within a reasonable period of time to allow the other Members to participate in the choosing of the forum in which such petition will be filed.
(m)
If any Member intends to file a notice of inconsistent treatment under Code Section 6222(b), such Member shall give reasonable notice under the circumstances to the other Members of such intent and the manner in which the Member’s intended treatment of an item is (or may be) inconsistent with the treatment of that item by the other Members.
Article 9
BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
|
|
9.04
|
Maintenance of Books
.
(bb)
The Operator shall keep or cause to be kept at the principal office of the Company or at such other location approved by the Management Committee complete and accurate books and records of the Company, including all books and records necessary to provide to the Members any information required to be provided pursuant to Section 9.02, supporting documentation of the transactions with respect to the conduct of the Company’s business and minutes of the proceedings of its Members and the Management Committee, and any other books and records that are required to be maintained by applicable Law.
|
(cc)
The books of account of the Company shall be (i) maintained on the basis of a fiscal year that is the calendar year, (ii) maintained on an accrual basis in accordance with Required Accounting Practices, and (iii) unless the Management Committee decides otherwise, audited by the Certified Public Accountants at the end of each calendar year.
|
|
9.05
|
Reports
.
(n)
With respect to each calendar year, the Operator shall prepare and deliver to each Member:
|
(iv)
Within 75 Days after the end of such calendar year, a statement of operations and a statement of cash flows for such year, a balance sheet as of the end of such year, and an audited report thereon of the Certified Public Accountants;
provided
that, upon the written request of one or more Members at least [***] Days prior to the applicable calendar year end, which request shall be a standing request effective for subsequent calendar years unless and until revoked by the requesting Member, the Operator shall prepare and deliver to the requesting Member(s) within 25 Days after the end of each such calendar year the foregoing information except for the audited report, which the Operator shall use reasonable efforts to prepare and deliver to the requesting Member(s) no later than 14 Days prior to any regulatory, contractual or filing deadlines of such Member for which the Operator has been notified by such Member.
(v)
Within 75 Days after the end of such calendar year, such federal, state and local income tax returns and such other accounting and tax information and schedules as shall be necessary for tax reporting purposes by each Member with respect to such year.
(o)
Upon the written request of one or more Founding Members at least [***] Days prior to the applicable calendar year end, the Operator shall use reasonable efforts to prepare and deliver to the requesting Founding Member(s) the following information within [***] Days after the end of such calendar year:
(iv)
A discussion and analysis of the results of operations including detailed explanations of significant variances in revenues, expenses and cash flow activities appearing in the audited financial statements, as compared to the same periods in the prior calendar year, and relevant operational statistics, including volumetric data;
(v)
A schedule of amounts due by year for contractual obligations that will impact Available Cash including notes payable, capital leases, operating leases, and purchase obligations; and
(vi)
A three-year forward-looking forecast that includes a balance sheet, profit and loss statement, and a statement of cash flows. Such forecast shall include information pertaining to the underlying assumptions used in its preparation including volumetric, revenue per-unit and capital expenditure assumptions. Such forecast also shall be updated within 45 Days after execution by the Company of a material Gas Transportation Service Agreement if the timing and amount of revenues or expenses resulting from such agreement are materially different than estimates included in the forward-looking forecast.
The reasonable incremental cost to the Operator of preparing the above reports shall be reimbursed to the Operator by the Founding Member requesting such reports and, in the case of two or more Founding Members requesting such reports, equally by such Founding Members. Such cost shall be determined in accordance with the Accounting Procedure set forth in the COM Agreement.
(p)
Within 25 Days after the end of each calendar month, the Operator shall cause to be prepared and delivered to each Member with an appropriate certification of the Person authorized to prepare the same (
provided
that the Management Committee may change the financial statements required by this Section 9.02(c) to a quarterly basis or may make such other change therein as it may deem appropriate):
(v)
A statement of operations for such month (including sufficient information to permit the Members to calculate their tax accruals) and for the portion of the calendar year then ended as compared with the same periods for the prior calendar year and with the budgeted results for the current periods;
(vi)
A balance sheet
as of the end of such month and the portion of the calendar year then ended; and
(vii)
For quarter month end, a statement of cash flows for the portion of the calendar year then ended as compared to the same period for the prior calendar year.
(q)
In addition to its obligations under subsections (a), (b), and (c) of this Section 9.02, but subject to Section 3.06, the Operator shall timely prepare and deliver to any Member, upon request, all of such additional financial statements, notes thereto and additional financial information as may be required in order for each Member or an Affiliate of such Member to comply with any reporting requirements under (i) the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, (ii) the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, and (iii) any national securities exchange or automated quotation system. The reasonable incremental cost to Operator of preparing and delivering such additional financial statements, notes thereto and additional financial information, including any required incremental audit fees and expenses, shall be reimbursed to the Operator by the Member requesting such reports and, in the case of two or more Members requesting such additional information, equally by such Members. Such cost shall be determined in accordance with the Accounting Procedure set forth in the COM Agreement.
(r)
Operator shall also cause to be prepared and delivered to each Founding Member such other reports, forecasts, studies, budgets and other information as such Founding Member may reasonably request from time to time.
(s)
For purposes of clarification and not limitation, any audit or examination by a Member pursuant to Section 3.6 of the COM Agreement may, at the option of such Member, include audit or examination of the books, records and other support for the costs incurred pursuant to subsections (b) and (e) of this Section 9.02.
|
|
9.06
|
Bank Accounts
. Funds of the Company shall be deposited in such banks or other depositories as shall be designated from time to time by the Management Committee and shall not be commingled with the Operator’s funds. All withdrawals from any such depository shall be made only as authorized by the Management Committee and shall be made only by check, wire transfer, debit memorandum or other written instruction. The Management Committee may authorize the Operator to designate and maintain accounts in any such banks or other depositories in accordance with Exhibit A to the COM Agreement.
|
Article 10
WITHDRAWAL
|
|
10.04
|
Right of Withdrawal
. (a) Prior to the In-Service Date, no Member shall have the right to withdraw from the Company and (b) following the In-Service Date, each Member shall have the right to withdraw from the Company [***] Days following delivery of written notice to the Management Committee.
|
|
|
10.05
|
Deemed Withdrawal
. A Member is deemed to have Withdrawn from the Company upon the occurrence of any of the following events:
|
|
|
(g)
|
the Member is deemed, pursuant to Section 7.01(d) to have Withdrawn from the Company;
|
|
|
(h)
|
there occurs an event that makes it unlawful for the Member to continue to be a Member;
|
|
|
(i)
|
the Member becomes Bankrupt;
|
|
|
(j)
|
the Member dissolves and commences liquidation or winding-up; or
|
|
|
(k)
|
the Member commits a Default.
|
|
|
10.06
|
Effect of Withdrawal
. A Member that is deemed to have Withdrawn pursuant to Section 10.01 or Section 10.02 (a “
Withdrawn Member
”), must comply with the following requirements in connection with its Withdrawal:
|
(p)
The Withdrawn Member ceases to be a Member immediately upon the occurrence of the applicable Withdrawal event.
(q)
The Withdrawn Member shall not be entitled to receive any distributions from the Company except as set forth in Section 10.03(e), and neither it nor its Representative shall be entitled to exercise any voting or consent rights, or to appoint any Representative or Alternate Representative to the Management Committee (and the Representative (and the Alternate Representative) appointed by such Member shall be deemed to have resigned) or to receive any further information (or access to information) from the Company. The Sharing Ratio of such Member shall not be taken into account in calculating the Sharing Ratios of the Members for any purposes. This Section 10.03(b) shall also apply to a Breaching Member; but if a Breaching Member cures its breach during the applicable cure period, then any distributions that were withheld from such Member shall be paid to it, without interest.
(r)
The Withdrawn Member must pay to the Company all amounts owed to it by such Withdrawn Member.
(s)
The Withdrawn Member shall remain obligated for all liabilities it may have under this Agreement or otherwise with respect to the Company that accrue prior to the Withdrawal.
(t)
In the event of a Withdrawal under Section 10.01 or a deemed Withdrawal under Section 10.02(b) or (c), the Withdrawn Member shall be entitled to receive a portion of each distribution that is made by the Company from and after the In-Service Date, equal to the product of the Withdrawn Member’s Sharing Ratio as of the date of its Withdrawal
multiplied by
the aggregate amount of such distribution;
provided
that the Withdrawn Member’s rights under this Section 10.03(e) shall automatically terminate at such time as the Withdrawn Member has received an aggregate amount under this Section 10.03(e) equal to the sum of (i) lesser of (A) the Withdrawn Member’s Outstanding Capital Contribution, and (B) the Fair Market Value of the Withdrawn Member’s Membership Interest, each determined as of the date of the Withdrawal,
plus
(ii) any Indebtedness of the Company owed to such Member at the time of Withdrawal. From the date of the Withdrawal to the date of such payment, the amount owing to the Withdrawn Member pursuant to the preceding sentence shall be recorded as a contingent obligation of the Company until such payment is made. The rights of a Withdrawn Member under this Section 10.03(e) shall (A) be subordinate to the rights of any other creditor of the Company, (B) not include any right on the part of the Withdrawn Member to receive any interest or other amounts with respect thereto (except as may otherwise be provided in the evidence of any Indebtedness of the Company owed to such Withdrawn Member); (C) not require the Company to make any distribution (the Withdrawn Member’s rights under this Section 10.03(e) being limiting to receiving a portion of such distributions as the Management Committee may, in its Sole Discretion, decide to cause the Company to make); (D) not require any Member to make a Capital Contribution or a loan to permit the Company to make a distribution or otherwise to pay the Withdrawn Member; and (E) be treated as a liability of the Company for purposes of Section 12.02.
(u)
Except as set forth in Section 10.03(e), a Withdrawn Member shall not be entitled to receive any return of its Capital Contributions or other payment from the Company in respect of its Membership Interest. Any Performance Assurances or Credit Assurances provided by the Withdrawn Member and outstanding as of the date of Withdrawal shall continue as to the liabilities accrued prior to the date of Withdrawal for which such Performance Assurances were provided under Section 4.01(b) or such Credit Assurances were provided under Section 4.07;
provided
that, in the event a Member is Withdrawn pursuant to Section 10.02(e), such Member shall pay over and forfeit any remaining Performance Assurances as liquidated damages and not as a penalty.
(v)
The Sharing Ratio of the Withdrawn Member shall be allocated among the remaining Members in the proportion that each Member’s Sharing Ratio bears to the total Sharing Ratio of all remaining Members, or in such other proportion as the remaining Members may unanimously agree.
(w)
A deemed Withdrawal under Section 7.01(d) shall carry no connotation or implication that the Withdrawn Member has breached this Agreement or otherwise acted contrary to the intent of this Agreement, it being understood that (i) each Member is completely free to cast its vote as it wishes at the Management Committee meetings described in such Section and (ii) the concept of “deemed Withdrawal” in such Section is merely a convenient technique for permitting the continued development of the Facilities by the Members that desire to continue such development.
Article 11
DISPUTE RESOLUTION
|
|
11.06
|
Disputes
. This Article 11 shall apply to any dispute arising under or related to this Agreement (whether arising in contract, tort or otherwise, and whether arising at law or in equity), including (a) any dispute regarding the construction, interpretation, performance, validity or enforceability of any provision of this Agreement or whether any Person is in compliance with, or breach of, any provisions of this Agreement; (b) any deadlock among the Representatives on any matter requiring approval of the Management Committee (including any dispute over whether the Representatives of any Founding Member (or its Affiliates) are reasonably withholding their consent in connection with a determination by the Management Committee, but only with respect to those matters specifically identified in Section 6.02(j) and Section 6.05(e)) other than the matters covered by Sections 6.02(i)(G) or 6.02(i)(BB) (a “
Deadlock
”); and (c) the applicability of this Article 11 to a particular dispute. Notwithstanding the foregoing, this Section 11.01 shall not apply to any matters that, pursuant to the provisions of this Agreement, are to be resolved by a vote of the Management Committee;
provided
that, if a vote, approval, consent, determination or other decision must, under the terms of this Agreement, be made (or withheld) in accordance with a standard other than Sole Discretion (such as a reasonableness standard), then the issue of whether such standard has been satisfied may be a dispute to which this Article 11 applies (including Section 11.03); and
provided
,
further
, that any Deadlock shall be resolved solely as provided in Sections 11.02 and 11.05 hereof. Any dispute to which this Article 11 applies is referred to herein as a “
Dispute
.
” With respect to a particular Dispute, each Member that is a party to such Dispute is referred to herein as a “
Disputing Member
.
” The provisions of this Article 11 shall be the exclusive method of resolving Disputes.
|
|
|
11.07
|
Negotiation to Resolve Disputes
. If a Dispute arises, the Disputing Members shall attempt to resolve such Dispute through the following procedure:
|
(j)
first, the designated Representative of each of the Disputing Members shall promptly meet (whether by phone or in person) in a good faith attempt to resolve the Dispute; and
(k)
second, if the Dispute is still unresolved after ten (10) Business Days following the commencement of the negotiations described in Section 11.02(a), then the Parent Decision Makers shall meet in person within five (5) Business Days after the expiration of the aforementioned period of ten (10) Business Days, and such Parent Decision Makers shall attempt in good faith to resolve the Dispute as promptly as practicable.
|
|
11.08
|
Courts
. If a Dispute (other than a Deadlock) is still unresolved following ten (10) Business Days after a written request or demand for negotiations described in Section 11.02(b), then any of such Disputing Members may submit such Dispute only to the Court of Chancery of the State of Delaware or, in the event that such court does not have jurisdiction over the subject matter of such Dispute, to another court of the State of Delaware or a U.S. federal court located in the State of Delaware (collectively, “
Delaware Courts
”), and each of the Members irrevocably submits to the exclusive jurisdiction of the Delaware Courts and hereby consents to service of process in any such Dispute by the delivery of such process to such party at the address and in the manner provided in Section 13.02. Each of the Members hereby irrevocably and unconditionally waives any objection to the laying of venue in any Dispute in the Delaware Courts and hereby further irrevocably and unconditionally waives and agrees not to plead or clam in any such court that any action, suit or proceeding brought in any such court has been brought in an inconvenient forum. EACH MEMBER IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.
|
|
|
11.09
|
Specific Performance
. The Members understand and agree that (a) irreparable damage would occur in the event that any provision of this Agreement were not performed in accordance with its specific terms, (b) although monetary damages may be available for the breach of such covenants and agreements such monetary damages are not intended to and do not adequately compensate for the harm that would result from a breach of this Agreement, would be an inadequate remedy therefor and shall not be construed to diminish or otherwise impair in any respect any Member’s or the Company’s right to specific performance and (c) the right of specific performance is an integral part of the transactions contemplated by this Agreement and without that right none of the Members would have entered into this Agreement. It is accordingly agreed that, in addition to any other remedy that may be available to it, including monetary damages, each of the Members and the Company shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement. Each of the Members further agrees that no Member nor the Company shall be required to obtain, furnish or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this Section 11.04 and each Member waives any objection to the imposition of such relief or any right it may have to require the obtaining, furnishing or posting of any such bond or similar instrument.
|
(e)
If a Deadlock is still unresolved pursuant to the procedures set forth in Section 11.02, then the Deadlock shall be settled by arbitration conducted in the English language in New York, New York, administered by and in accordance with the terms of this Agreement and the Commercial Arbitration Rules (“
Rules
”) of the American Arbitration Association (“
AAA
”) (the “
Arbitration
”).
(f)
Any Disputing Member (the “
Arbitration Invoking Party
”) may, by notice (the “
Arbitration Notice
”) to any other Disputing Member (the “
Arbitration Noticed Party
”), submit the Dispute to Arbitration in accordance with the provisions of this Section 11.05(b). Any Disputing Member may initiate Arbitration by filing with the AAA a notice of intent to arbitrate within the mediation period.
(g)
Any such Arbitration proceeding shall be before a tribunal of three (3) arbitrators, one (1) designated by the Arbitration Invoking Party, one (1) designated by the Arbitration Noticed Party, and one (1) designated by the two (2) arbitrators so designated. The Arbitration Invoking Party and the Arbitration Noticed Party shall each name their arbitrator by notice (the “
Selection Notice
”) given within five (5) Business Days after the date of the Arbitration Notice, and the two (2) arbitrators so appointed shall agree upon the third member of the tribunal within five (5) Business Days after the date of the Selection Notice. Any member of the tribunal not appointed within the period required, whether by one of the Disputing Members or by the two (2) arbitrators chosen by the Disputing Members, shall be appointed by the AAA. The arbitrators shall have no affiliation with, financial or other interest in, or prior employment with either Disputing Member or their Affiliates and shall be experienced and well-regarded oil and gas attorneys knowledgeable in the field of the dispute.
(h)
In any Arbitration in which the Deadlock involves a dispute over whether the Representatives of any Founding Members are reasonably withholding their consent in connection with a determination by the Management Committee with respect to any matter identified in Section 6.02(j) or Section 6.05(e), the arbitrators shall first determine whether the Representatives of such Founding Member are reasonably withholding their consent in the matter(s) in question and, if such Representatives are determined to have acted reasonably, the arbitrators shall then immediately proceed to resolve the Deadlock among the Representatives on the matter(s) requiring approval of the Management Committee.
(i)
Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall have twenty (20) Business Days, commencing on the date the Arbitration Notice is given, to prepare and submit a proposal for the resolution of the dispute to the tribunal, including a description of how such Disputing Member arrived at its proposal and the arguments therefor, as it deems appropriate. Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall deliver a copy of its proposal, including any such supplemental information, to the other Disputing Member at the same time it delivers the proposal to the tribunal.
(j)
Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall have five (5) Business Days after the receipt of the other Disputing Member’s proposal to revise its respective proposal and submit a final proposal to the tribunal, including supporting arguments for its own and against the other Disputing Member’s proposal.
(k)
Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall present oral arguments supporting its final proposal to the tribunal at a proceeding held five (5) Business Days after the deadline for submission of final proposals to the tribunal. Each of the Arbitration Invoking Party and the Arbitration Noticed Party shall have three (3) hours to make its oral presentation to the tribunal.
(l)
The tribunal shall, within ten (10) Business Days after presentation of the oral arguments, render a decision that selects the Arbitration Invoking Party’s final proposal (with no modifications thereto) or the Arbitration Noticed Party’s final proposal (with no modifications thereto), and no other proposal. The award rendered pursuant to the foregoing shall be final and binding on the Disputing Members, shall not be subject to appeal, and judgment thereon may be entered or enforcement thereof sought by either Disputing Member in any court of competent jurisdiction.
(m)
Each Disputing Member shall bear the costs of its appointed arbitrator and its own attorneys’ fees, and the costs of the third arbitrator incurred in accordance with the foregoing shall be shared equally by the Disputing Members. Additional incidental costs of the Arbitration shall be paid for by the non-prevailing Disputing Member in the Arbitration.
(n)
Notwithstanding the foregoing, each Disputing Member may at any time in a Dispute apply to the Court of Chancery for a decree of dissolution of the Company pursuant to Section 18-802 of the Act.
Article 12
DISSOLUTION, WINDING-UP AND TERMINATION
|
|
12.05
|
Dissolution
. The Company shall dissolve and its affairs shall be wound up on the first to occur of the following events (each a “
Dissolution Event
”):
|
|
|
(y)
|
decision to dissolve the Company by Supermajority Interest;
|
|
|
(z)
|
entry of a decree of judicial dissolution of the Company under Section 18-802 of the Act;
|
|
|
(aa)
|
the Disposition or abandonment of all or substantially all of the Company’s business and assets;
|
|
|
(bb)
|
an event that makes it unlawful for the business of the Company to be carried on;
|
|
|
(cc)
|
by 10 Business Days’ written notice of termination given by USG or EQT if the initial Construction Budget, the Project Schedule and the Initial Operating Budget have not been approved by USG and EQT by the [***] Day following the delivery thereof to USG;
provided
,
however
, that, if the initial Construction Budget, Project Schedule and the Initial Operating Budget are approved within 10 Business Days following delivery of such notice of termination, then such written notice of termination shall be null and void, and this Agreement shall continue in full force and effect.
|
|
|
12.06
|
Winding-Up and Termination
.
(l)
On the occurrence of a Dissolution Event, the Management Committee shall designate a Member or other Person to serve as liquidator. The liquidator shall proceed diligently to wind up the affairs of the Company and make final distributions as provided herein and in the Act. The costs of winding-up shall be borne as a Company expense. Until final distribution, the liquidator shall continue to operate the Company properties with all of the power and authority of the Members. The steps to be accomplished by the liquidator are as follows:
|
(viii)
as promptly as possible after dissolution and again after final winding-up, the liquidator shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company’s assets, liabilities, and operations through the last Day of the month in which the dissolution occurs or the final winding-up is completed, as applicable;
(ix)
the liquidator shall discharge from Company funds all of the Indebtedness of the Company and other debts, liabilities and obligations of the Company (including all expenses incurred in winding-up and any loans described in Section 4.02) or otherwise make adequate provision for payment and discharge thereof (including the establishment of a cash escrow fund for contingent liabilities in such amount and for such term as the liquidator may reasonably determine); and
(x)
all remaining assets of the Company shall be distributed to the Members as follows:
(A)
the liquidator may sell any or all Company property, including to Members, and any resulting gain or loss from each sale shall be computed and allocated to the Capital Accounts of the Members in accordance with the provisions of Article 5;
(B)
with respect to all Company property that has not been sold, the fair market value of that property shall be determined and the Capital Accounts of the Members shall be adjusted to reflect the manner in which the unrealized income, gain, loss, and deduction inherent in property that has not been reflected in the Capital Accounts previously would be allocated among the Members if there were a taxable disposition of that property for the fair market value of that property on the date of distribution; and
(C)
Company property (including cash) shall be distributed among the Members in accordance with Section 5.01; and those distributions shall be made by the end of the taxable year of the Company during which the liquidation of the Company occurs (or, if later, [***] Days after the date of the liquidation).
(m)
The distribution of cash or property to a Member in accordance with the provisions of this Section 12.02 constitutes a complete return to the Member of its Capital Contributions and a complete distribution to the Member of its Membership Interest and all the Company’s property and constitutes a compromise to which all Members have consented pursuant to Section 18-502(b) of the Act. To the extent that a Member returns funds to the Company, it has no claim against any other Member for those funds.
(n)
No dissolution or termination of the Company shall relieve a Member from any obligation to the extent such obligation has accrued as of the date of such dissolution or termination. Upon such termination, any books and records of the Company that there is a reasonable basis for believing will ever be needed again shall be furnished to the Operator, who shall keep such books and records (subject to review by any Person that was a Member
at the time of dissolution) for a period at least three (3) years. At such time as the Operator no longer agrees to keep such books and records, it shall offer the Persons who were Members at the time of dissolution the opportunity to take over such custody, shall deliver such books and records to such Persons if they elect to take over such custody, and may destroy such books and records if they do not so elect. Any such custody by such Persons shall be on such terms as they may agree upon among themselves.
|
|
12.07
|
Deficit Capital Accounts
. No Member will be required to pay to the Company, to any other Member or to any third party any deficit balance that may exist from time to time in any Member’s Capital Account.
|
|
|
12.08
|
Certificate of Cancellation
. On completion of the distribution of the Company’s assets as provided herein, the Members (or such other Person or Persons as the Act may require or permit) shall file a certificate of cancellation with the Secretary of State of Delaware, cancel any other filings made pursuant to the Act, and take such other actions as may be necessary to terminate the existence of the Company. Upon the filing of such certificate of cancellation, the existence of the Company shall terminate (and the Term shall end), except as may be otherwise provided by the Act or other applicable Law.
|
Article 13
GENERAL PROVISIONS
|
|
13.13
|
Offset; Costs and Expenses
.
(a)
Whenever the Company is to pay any sum to any Member, any amounts that Member owes the Company may be deducted from that sum before payment.
|
(b)
The Company shall reimburse the Founding Members for all out-of-pocket costs and expenses incurred by the Founding Members prior to the Effective Date in connection with the drafting, review and negotiation of this Agreement and the COM Agreement and for any out-of-pocket costs or expenses incurred by a Member in connection with the formation of the Company.
|
|
13.14
|
Notices
. Except as expressly set forth to the contrary in this Agreement, all notices, requests or consents provided for or permitted to be given under this Agreement must be in writing and must be delivered to the recipient in person, by courier or mail, or by facsimile or other electronic transmission, including electronic mail. A notice, request or consent given under this Agreement is effective on receipt by the Member to receive it;
provided
that a facsimile or other electronic transmission that is transmitted after the normal business hours of the recipient shall be deemed effective on the next Business Day. All notices, requests and consents to be sent to a Member must be sent to or made at the addresses given for that Member on
Exhibit A
or in the instrument described in Section 3.03(b)(iv)(A)(2) or Section 3.04, or such other address as that Member may specify by notice to the other Members. Any notice, request or consent to the Company must be given to all of the Members. Whenever any notice is required to be given by Law, the Delaware Certificate or this Agreement, a written waiver thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.
|
|
|
13.15
|
Entire Agreement; Superseding Effect
. This Agreement and the COM Agreement constitute the entire agreement of the Members and their Affiliates relating to the Company and the transactions contemplated hereby and supersede all provisions and concepts contained in all prior agreements.
|
|
|
13.16
|
Effect of Waiver or Consent
. Except as otherwise provided in this Agreement, a waiver or consent, express or implied, to or of any breach or default by any Member in the performance by that Member of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that Member of the same or any other obligations of that Member with respect to the Company. Except as otherwise provided in this Agreement, failure on the part of a Member to complain of any act of any Member or to declare any Member in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that Member of its rights with respect to that default until the applicable statute-of-limitations period has run.
|
|
|
13.17
|
Amendment or Restatement
. This Agreement and the Delaware Certificate may be amended or restated only by a written instrument executed (or, in the case of the Delaware Certificate, approved) by Supermajority Interest;
provided
,
however
, that any amendment or restatement that is materially adverse to any Member in a manner that is disproportionate to such Member’s interest (as compared to the interest of other Members) shall (a) if the affected Member is a Founding Member, require the written consent or approval of such Founding Member; or (b) if the affected Member is not a Founding Member, require the written consent or approval of a majority of all Members similarly adversely affected.
|
|
|
13.18
|
Binding Effect
. Subject to the restrictions on Dispositions set forth in this Agreement, this Agreement is binding on and shall inure to the benefit of the Members and their respective successors and permitted assigns.
|
|
|
13.19
|
Governing Law; Severability
. THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT MIGHT REFER THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAW OF ANOTHER JURISDICTION. In the event of a direct conflict between the provisions of this Agreement and any mandatory, non-waivable provision of the Act, such provision of the Act shall control. If any provision of the Act provides that it may be varied or superseded in a limited liability company agreement (or otherwise by agreement of the members or managers of a limited liability company), such provision shall be deemed superseded and waived in its entirety if this Agreement contains a provision addressing the same issue or subject matter. If any provision of this Agreement or the application thereof to any Member or circumstance is held invalid or unenforceable to any extent, (a) the remainder of this Agreement and the application of that provision to other Members or circumstances is not affected thereby, and (b) the Members shall negotiate in good faith to replace that provision with a new provision that is valid and enforceable and that puts the Members in substantially the same economic, business and legal position as they would have been in if the original provision had been valid and enforceable.
|
|
|
13.20
|
Further Assurances
. In connection with this Agreement and the transactions contemplated hereby, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Agreement and those transactions;
provided
,
however
, that this Section 13.08 shall not obligate a Member to furnish guarantees or other credit supports by such Member’s Parent or other Affiliates.
|
|
|
13.21
|
Waiver of Certain Rights
. Each Member irrevocably waives any right it may have to maintain any action for dissolution of the Company or for partition of the property of the Company.
|
|
|
13.22
|
Counterparts
. This Agreement may be executed in any number of counterparts with the same effect as if all signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument.
|
|
|
13.23
|
Fair Market Value Determination
.
|
(a)
[***]
(b)
[***]
(c)
[***]
[Remainder of page intentionally left blank. Signature page follows.]
IN WITNESS WHEREOF, the Members have executed this Agreement as of the date first set forth above.
MEMBERS
:
[EQT], LLC
By:
Name:
Title:
[USG], LLC
By:
Name:
Title:
COMPANY
:
[●], LLC
By:
Name:
Title:
EXHIBIT A
MEMBERS
|
|
|
|
|
Name, Address, Fax and E-mail
|
Sharing
Ratio
|
Parent
|
Representative and Alternate Representatives
|
[EQT]
EQT Plaza
625 Liberty Avenue
Pittsburgh, Pennsylvania 15222
|
[●]%
|
[●]
|
[●] – Representative
[●] – Alternate Representative
|
[USG]
601 Travis Street
Suite 1900
Houston, Texas 77002
Fax: 713.751.0375
|
[●]%
|
[●]
|
[●] – Representative
[●] – Alternate Representative
|